Law Society successfully intervenes in landmark case for access to justice

26 January 2011

A landmark case has prompted the Court of Appeal to revisit the definition of, and confirm the court’s modern approach to, champertous agreements and access to justice issues.

In the case of Sibthorpe and Morris v London Borough of Southwark, the Master of the Rolls today found that a CFA between the parties was binding.

The case concerned an appeal by the London Borough of Southwark against the original court’s finding in a housing disrepair case that a conditional fee agreement was lawful and therefore enforceable where the solicitor had indemnified a client against any adverse costs order in the event that the case was unsuccessful.

Last year the Law Society intervened on the basis that this issue was one of significant importance to solicitors and access to justice.

Law Society President Linda Lee said; "The Government’s proposals to abolish the recovery of ATE premiums from defendants in successful cases combined with changes to the scope of legal aid, will lead to many individuals finding it difficult to bring claims where their only access to a remedy is through the courts and although in some instances solicitors would be able to offer an indemnity for costs, this would be very rare.

"Funding of this type will not replace the products currently offered by the insurance market. If the government proposals are introduced they will undoubtedly adversely effect the after the event insurance market, and the public should be aware that their ability to defend their rights which they have enjoyed over the last few years will disappear.

"The solicitors in this case did not breach any professiona conduct rule and made every effort to assist a client with funding what was clearly a valid claim.

"The Court of Appeal has reached an eminently sensible decision which, in addition to providing a clear message about the importance of access to justice it also paves the way for clients to be fully indemnified against adverse costs orders by solicitors in cases where either legal aid or legal expenses insurance are unavailable.

"The Law Society was surprised that the appeal was commenced in the first place especially bearing in mind the Government’s policy on public spending cuts and the fact that the solicitors’ indemnity would have reimbursed the local authority’s legal costs had it successfully defended the original claim."

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