Death clause in Law Society’s Standard CFA is enforceable

The High Court has today handed down judgment in the landmark case of Higgins and Co v Evans –

https://www.4newsquare.com/wp-content/uploads/2019/10/Higgins-Co-v-Evans-Approved-Judgment.pdf

We acted for the Solicitors, Higgins and Co in the Appeal before Saini J. The case was all about what is known as the ‘death’ clause in the Law Society’s Standard CFA. Many practitioners will be familiar with the clause that says –

‘(c) Death – This agreement automatically ends if you die before your claim for damages is concluded. We will be entitled to recover our basic charges up to the date of your death from your estate. If your personal representatives wish to continue your claim for damages, we may offer them a new conditional fee agreement as long as they agree to pay the success fee on our basic charges from the beginning of the agreement with you.’

In this case, the deceased had instructed the Solicitors in relation to an asbestos related claim. He sadly passed away before the case was concluded. There was no new CFA. The Solicitors delivered a bill to the estate under this clause.

The case itself continued with new solicitors and is not yet concluded.

The estate contested the bill. At first instance Master McCloud ruled the clause unenforceable. She found that it was unusual and onerous. She also found that it had not been brought specifically to the attention of the deceased under what is known as the Interfoto Principle (Interfoto Picture Library Limited v Stiletto Visual Programmes Limited [1989] QB (CA).

A separate argument was presented on appeal on behalf of the estate. This was that any liability for costs was contingent on success. As the case was not concluded, there were no ‘base costs’ and therefore the costs should be assessed as nil.

The High Court overturned the master’s decision. Saini J found –

1. That the clause was not unusual and onerous. It is a standard clause that is found in thousands of agreements,
2. By signing the CFA, the client had confirmed that he had read and understood the agreement. This disposed of the Interfoto argument.
3. There nothing in the Consumer Rights Act that rendered the agreement unenforceable.
4. The solicitors were entitled to their costs.

This is a decision of great importance to all solicitors who act on a CFA basis. There has been uncertainty about the effect of the ‘death’ clause in the Law Society’s Standard Agreement. In many cases the PR’s will sign a new agreement. But this provides certainy to solicitors who are entitled to be paid for work done in other cases.