A celebrity has made it into costs news once again, though for me it would take royalty to beat the legendary status of Brian May. This time we look at a media claim involving Oscar-nominated film director Michael Radford, perhaps most famous for the 1984 movie titled “1984” starring John Hurt and Richard Burton.
Mr Radford, as an individual and also trading as The Michael Radford Partnership (the Claimants/Respondents), was retained by the individual and corporate Defendants/Appellants to direct a Spanish film called La Mula. After some time, the parties fell out and Mr Radford departed the project to be replaced by another director.
In July 2010, Mr Radford started proceedings for various causes of action including defamation, unlawful means conspiracy, and to obtain injunctions against the Defendants to prohibit them from using or publishing film footage which he had produced without his permission. The Claimant obtained injunctions in August 2010 by an application without notice.
Taylor Hampton Solicitors and Augustus Ullstein QC were instructed under CFAs to set aside the injunctions by disputing the jurisdiction of the English court and the validity of service of the proceedings. The Defendants filed an application notice for these purposes in February 2012 and achieved their objectives by consent order made by Tugendhat J on 23 May 2012. By that Order, the Judge declared that the claim form had not been served on the individual Defendants but had been served on the corporate Defendants; that the injunctions were discharged; and that the Defendants all agreed to make no claim on the cross-undertaking as to damages which the Claimants had given.
By this point the proceedings against the individual Defendants were over, success achieved by the order of 23 May 2012, but the proceedings continued against the corporate Defendants due to valid service of the claim form. A Defence and Counterclaim was served and default judgment entered on the Counterclaim.
In March 2013, Taylor Hampton applied for summary judgment. In February 2014, Master Eyre granted the application, having concluded that the claims were hopeless. An application for permission to appeal against that decision was dismissed by Sir David Eady on 28 July 2014. The Defendants became entitled to recover their costs of the claim – the Counterclaim continues at the time of writing. Master Eyre made an order for payment of £120,000 on account of costs, which was upheld by Sir Eady.
Taylor Hampton submitted a Bill of Costs in the sum of £805,500 on the basis that all work carried out by the firm and Mr Ullstein was done pursuant to their CFAs, and they were entitled to recover success fees accordingly.
The matter proceeded to Detailed Assessment where Master Haworth ruled that the CFA was meant to cover only procedural issues such as service and jurisdiction. Master Haworth held that neither the solicitors nor Counsel could recover fees for work after 23 May 2012 because such fees were not within the scope of the CFAs and no other enforceable retainer existed to entitle them to charge such fees. Master Haworth found that the CFA definition of “win” had been achieved by the order of 23 May 2012 therefore the scope of the agreement had come to an end. Counsel’s CFA was with Taylor Hampton and the Defendants had no liability to pay the fees, furthermore Counsel’s CFA did not identify the corporate Defendants as clients. As the Defendants were not liable for the fees, they were not recoverable from the Claimants due to the indemnity principle.
The Defendants appealed this decision to the High Court where the appeal was dismissed by Warby J on 8 July 2016. The Defendants then appealed to the Court of Appeal which resulted in the judgment of Lord Justice McCombe on 7 February 2018. The limited grounds of appeal were that the fees after 23 May 2012 were covered by the written retainer or an implied quantum meruit retainer resulting from ongoing instructions, that Counsel’s fees were recoverable following a Deed of Rectification dated 30 July 2015 which extended Counsel’s CFA to cover the corporate Defendants, and that even if the work done by Counsel was not subject to the CFA it was alternatively payable on a quantum meruit retainer.
At appeal, Lord Justice McCombe confirmed the lower decisions that it was “impossible” for a conventional retainer to continue alongside a CFA and that the Defendants understood that the CFA superseded the original conventional retainer. With regard to the quantum meruit arguments, the Appellants relied upon Adams v Improved Motor Coach Builders Ltd  1 KB 495 (CA) that a client who instructs a solicitor comes under an obligation to pay for it. The Court distinguished Adams as in that case Mr Adams had no express agreement with the solicitors instructed by his Trade Union, however the facts in this case involved two express agreements and there was never any renegotiation of the understanding of the conditional fee basis. It was “unfortunate” that the solicitors had not confirmed in writing the fee agreement for ongoing work. This dismissed the quantum meruit arguments.
In terms of Counsel’s Deed of Rectification, the Respondents relied upon Kellar v Williams  UKPC 30 which found that variation of a fee paying agreement to increase the liability for fees when made subsequent to the costs order can be disregarded by the paying party. Lord Justice McCombe found that the retrospective variation of Counsel’s CFA, after the making of the costs order, could not be effective to increase the liability of the paying parties.
The appeal was therefore dismissed on all grounds.
The moral of the story? You may think that the Jackson Reforms led to an Orwellian regime of fixed costs, but this decision is common-sense rather that totalitarian dystopia. If you want to avoid committing thoughtcrime, please ensure that your retainer properly covers the scope of the work you undertake. Once the costs liability has crystallised, it is too late to correct any errors.