Court of Appeal has handed down its long-awaited judgment in the case of Alina
Budana (Appellant) v Leeds Teaching Hospitals NHS Trust (Respondent) & Law
Society (Intervener)  EWCA Civ 1980.
the Court held that a Conditional Fee Agreement (“CFA”) can be validly assigned from one firm of solicitors to another.
That being the case, the Claimant was entitled to recover a pre-LASPO success
fee, provided for by the original CFA, from the Defendant.
2nd December 2011 the Claimant instructed a firm of solicitors (“Sol
1”) to pursue a personal injury claim against the Defendant arising out of a
tripping accident at their premises on 6th November 2011.
Claimant entered into a CFA which provided for a 100% success fee.
1 subsequently decided that it was no longer economically viable for it to
continue handling personal injury claims and entered into a collective
agreement with a second firm (“Sol 2”) to transfer its book of personal injury
cases to them. That collective agreement was subject to a “master deed” of
assignment between the two firms.
22nd March 2013 Sol 1 told the Claimant that it would no longer be
dealing with personal injury claims and that her claim was being passed to Sol
2. On 10th April 2013 the Claimant signed letters of instruction for
Sol 2, along with a deed of assignment assigning, among other things, the
Claimant also signed a new, alternative, CFA with Sol 2, which was due to come
into effect only if the deed of assignment was held not to allow Sol 2 to
Claimant’s claim was settled and the Defendant was ordered to pay her costs.
The Claimant sought recovery of those costs, including the success fee, under
the original CFA. She argued that she had assigned the CFA to Sol 2 and that
the transitional provisions set out as s.44(6) Legal Aid, Sentencing and
Punishment of Offenders Act 2012 (“LASPO”) applied.
Defendant argued that the original CFA was terminated by Sol 1’s letter of 22nd
March. Alternatively, if the CFA had survived then it could only have been
novated, rather than assigned, after 1st April 2013.
first instance the court held that the CFA had
been terminated by the letter of 22nd March. The judge further
held that neither firm was entitled to be paid for any work done under the
original CFA. If the CFA had survived, there would have been a valid
Claimant appealed, with the Defendant cross-appealing the judgment regarding
the valid assignment had the CFA survived.
Court of Appeal held that the original CFA was not terminated by the letter of
22nd March. Nothing contained within the letter itself, or the
transfer of the CFA, could render the contract terminated without the agreement
of the Claimant.
there may have been a novation, that did not preclude the recovery by Sol 2 of
the success fee set out in the original CFA. The master deed and second deed
made clear that the intention was simply to substitute Sol 2 for Sol 1 under
the terms of the existing retainer.
original CFA remained binding and enforceable between the Claimant and Sol 2.
There was no reason in principle why a CFA should not be capable of assignment.
the Defendant’s position would “mean the
worst of both worlds” for the Claimant, who would “forfeit the rights which they had prior to 1st April 2013
whilst potentially also not obtaining the mitigating benefits available to
those entering into their arrangements after 1st April 2013. That
would be perverse.”
Claimant’s appeal was allowed, with the Defendant’s cross-appeal dismissed.
full judgment can be found here: