Conditional Fee Agreements - Kilby v Gawith (2008)

JANE KILBY v DONALD GAWITH (2008)

[2008] EWCA Civ 812

CA (Civ Div) (Sir Anthony Clarke MR, Arden LJ, Dyson LJ) 19/5/2008

CIVIL PROCEDURE - COSTS

COSTS : DISCRETION : PERCENTAGE INCREASES : SUCCESS FEES : ENTITLEMENT TO SUCCESS FEE UNDER R.45.11 CPR : r.45.11(2) CIVIL PROCEDURE RULES 1998 : r.45.11 CIVIL PROCEDURE RULES 1998 : r.45.11(1) CIVIL PROCEDURE RULES 1998

Where liability for a road traffic accident was admitted, the respondent, who had entered into a conditional fee agreement, was entitled to claim a success fee under the CPR r.45.11 and the court had no discretion whether or not to allow a success fee or to apply a different level from that provided in the Rules.

The appellant (G) appealed against a costs decision made in favour of the respondent (K). G and K had been involved in a road traffic accident. G admitted liability and K, who had the benefit of before-the-event insurance, entered into a conditional fee agreement with her solicitor. Quantum was agreed and G agreed to pay costs but disputed the success fee fixed at 12.5 per cent of the fixed recoverable costs by virtue of the CPR r.45.11(2). K issued costs proceedings and G contended that the court had a discretion whether or not to allow a success fee and at what level. The costs judge ruled that r.45.11(2) was not discretionary. A district judge dismissed G's appeal.

HELD: The costs judge and district judge had reached the correct conclusion for the reasons they gave. The CPR r.45.11 had to be construed by reference to its ordinary natural meaning in the context of the rules as a whole. Whilst the CPR r.45.11(1) provided that a claimant "may recover a success fee", the natural meaning was that a claimant was entitled to claim a success fee. Rule 45.11(2) provided that the amount of the success fee "shall be" 12.5 per cent, which meant that where a success fee was recovered it had to be 12.5 per cent. If the draftsman had meant for there to be a discretion to grant a success fee he would not have fettered that discretion by specifying the amount. The purpose of the rules was to provide fixed levels of remuneration, Nizami v Butt (2006) EWHC 159 (QB), (2006) 1 WLR 3307 and Lamont v Burton (2007) EWCA Civ 429, (2007) 1 WLR 2814 applied. The approach to before-the-event insurance in Sarwar v Alam (2001) EWCA Civ 1401, (2002) 1 WLR 125 did not lead to the conclusion that r.45.11(2) should be construed any differently, Sarwar applied.

Appeal dismissed

Counsel:
For the appellant: Jeremy Morgan QC
For the respondent: Nicholas Bacon

Solicitors:
For the appellant: McCullagh & Co
For the respondent: Camps

Source : Lawtel