Switch from Public Funding to CFA
Yesil v Doncaster & Bassetlaw Hospitals NHS Foundation Trust
These 3 cases were all clinical negligence matters where the claims were initially legally aided. However, just before the new rules came into force on 01/04/13 preventing a Claimant being able to recover a success fee and an ATE insurance premium, the legal aid certificates were discharged in all 3 cases and the Claimants entered into CFAs with their Solicitors, with ATE premiums.
In AH v Lewisham Hospital NHS Trust, the Defendant had made a partial admission of liability and breach of duty in the letter of response in January 2012 and an offer had been made just before the CFA had been entered into. It was therefore argued that it was unreasonable for the Claimant to enter into a CFA at that stage.
The Court heard that although the Claimant was advised about the benefits of entering into a CFA, a full advice was not given in that the Simmons v Castle point was not explained (i.e. the additional 10% damages).
Deputy Master Campbell found that as there had been a failure to explain the consequences of Simmons v Castle, materially flawed advice in one aspect had been given, therefore the success fee and ATE premium were disallowed.
In Yesil v Doncaster & Bassetlaw Hospitals NHS Foundation Trust, again the Claimant was not specifically advised about the 10% uplift in damages and District Judge Besford found that the additional liabilities were unreasonably incurred and therefore were irrecoverable from the Defendant.
In Ramos v Oxford University NHS Trust, the Claimant’s Solicitor argued that there was a need to instruct experts in the fields of Neurosurgery, Neurology and Rheumatology, whose charges were between £250 and £400 an hour and that the LSC would not pay experts more than £180 per hour. In addition the Claimant’s Solicitor believed that LSC funding was not available when a solicitor was willing to act on a CFA. He also argued that by entering into a CFA with an ATE premium, the Claimant was not at risk of having to pay any legal costs out of her damages and this was therefore more beneficial to the Claimant.
Master Leonard found that that inadequate advice had been given, especially with regards to the Simmonds v Castle 10% uplift , that the change in funding had been made in haste and that the Claimant’s decision had ‘not been made on a fully informed basis’. Therefore the ATE premium and success fee were not recoverable.
In this case, the Claimant changed from LSC funding to a CFA in 2009, well before the new rules were even suggested. Here the change of funding was made before the Letter of Response (admissions of breach of duty and causation were made in the Letter of Response).
Master Leonard found that the decision to switch from LSC funding to a CFA with ATE Insurance was not a reasonable one and it wasn’t to the Claimant’s advantage. There was no persuasive evidence that an interim payment had been required by the Defendant to the extent that warranted the change in the funding arrangement. In addition the Claimant was exposed to a risk that he had no knowledge of; no advice was given to the Claimant at any point about having to bear any shortfall on the costs of the ATE premium should it be successfully challenged in part or whole. Mater Leonard found this was not a reasonable decision and was not to the Claimant’s advantage. He therefore disallowed the success and the ATE premium in full (a total amount of £237,000).