Court of Appeal finds CFA effective, notwithstanding a failure to name the correct defendant

Malone v Birmingham Community NHS Trust [2018] EWCA Civ 1376 (judgment 19 June 2018)

Court of Appeal finds CFA effective, notwithstanding a failure to name the correct defendant.


Background –
The Appellant was a prisoner at HMP Birmingham who issued proceedings against the Birmingham Community NHS Trust for their negligent failure, between August 2010 and January 2011, to diagnose that he had testicular cancer.
At all relevant times the prison was operated by the Ministry of Justice with health care services provided by two NHS trusts - Birmingham Community NHS Trust (‘the Respondent’) and Birmingham and Solihull Mental Health Foundation Trust (‘BSFT’).


The Appellant initially instructed Ross Aldridge Solicitors and entered into a Conditional Fee Agreement (‘CFA’) on 5th July 2011. Contact was established with both the prison governor and with the NHSLA, however, Ross Aldridge Solicitors had difficulty identifying the correct Defendant and in March 2012 New Law Solicitors were appointed.
New Law Solicitors also experienced difficulty identifying the appropriate Defendant and were unable to make contact with the Appellant for several months. However, on 16th January 2013 the Appellant met with New Law Solicitors, signed a CFA and was supplied with New Law's standard terms of business.


Uncertainty remained over the identity of the correct Defendant and when proceedings were issued on 16th August 2013 the Ministry of Justice, the Respondent and BSFT were all named as Defendants. On 4th October 2013 the Respondent acknowledged that it was responsible for the Appellant’s treatment and by an order dated 28th January 2014 the further Defendants were removed.


The Respondent subsequently settled the claim for £10,000.00 by Tomlin Order dated 20th March 2014 with costs to be assessed on the standard basis.


Detailed Assessment –
The matter proceeded to a detailed assessment before DJ Philips, regional costs judge for Wales. DJ Philips held that as a matter of construction the CFA, which named the Home Office only as a potential Defendant, excluded a claim against the Respondent and that costs were irrecoverable as the Appellant had no contractual liability to pay.


Appeal –
In the grounds of appeal the Appellant submitted that the judge was wrong in law to conclude that the CFA did not cover proceedings against the Respondent as (a) the function of the critical wording of the CFA which stated - ‘All work conducted on your behalf following your instructions provided on [sic] regarding your claim against Home Office for damages for personal injury suffered in 2010’ was to identify the claim to which the CFA related and not to limit the scope of the CFA to a claim against the Home Office, and (b) reference to ‘Home Office’ was a reference to the public authority responsible for the Appellant’s welfare including the Respondent.


Decision –
The Court considered a number of authorities including ICS Ltd v West Bromwich Building Society [1998] 1 WLR 896; Mannai Investment Co Ltd v Eagle Star Life Assurance Co Ltd [1997] AC 749; Chartbrook Ltd v Persimmon Homes Ltd [2009] UKHL 38, [2009] AC 1101 and, in particular, Wood v Capita Insurance Services [2017] UKSC 24; [2017] AC 1173.


Lord Justice Hamblen stated that the decision in Wood was – ‘likely to call for more emphasis on the factual matrix and contextual considerations and less principal emphasis on close textual analysis.’ He also noted the poor quality drafting of the CFA and identified a number of further errors and omissions.

It was accepted by the Respondent that reference to the ‘Home Office’ was a misnomer and Lord Justice Hamblen further stated - ‘As a matter of language, in my judgment the most natural reading of the critical wording is that the CFA covers ‘’all work conducted’’ on the claimant’s behalf which follows from the ‘‘instructions provided’’ in respect of his claim ‘’against Home Office.’’

Mr Justice Hamblen also stated that ‘reference to “Home Office" is descriptive of the instructions received rather than of the work to be done. It relates to past instructions rather than future work.’ This was supported by the prevailing context whereby the CFA was entered into at an early stage, there was uncertainty as to the appropriate Defendant and there was no further reason to limit the scope of the CFA.

The appeal was allowed; the CFA was not ‘limited to a claim against the Home Office/Ministry of Justice’.


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Noel Heslin

Senior Legal Costs Draftsman

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