Barristers’ powers and duties – Instructions – Overriding objective – Retainers

Richard Buxton (solicitors) (appellant) v Huw Llewelyn Paul Mills-Owens (respondent) and Law Society (intervener): CA (Civ Div) (Sir Mark Potter (President Fam Div), Lords Justice Dyson, Maurice Kay): 23 February 2010

The appellant firm of solicitors (B) appealed against a decision ([2008] EWHC 1831 (QB)) dismissing their appeal against a decision of a costs judge to disallow their claim for profit costs for acting for the respondent (M).

Barristers’ powers and duties – Instructions – Overriding objective – Retainers

Richard Buxton (solicitors) (appellant) v Huw Llewelyn Paul Mills-Owens (respondent) and Law Society (intervener): CA (Civ Div) (Sir Mark Potter (President Fam Div), Lords Justice Dyson, Maurice Kay): 23 February 2010

The appellant firm of solicitors (B) appealed against a decision ([2008] EWHC 1831 (QB)) dismissing their appeal against a decision of a costs judge to disallow their claim for profit costs for acting for the respondent (M).

B had been retained by M to conduct a statutory appeal against the grant of planning permission. Counsel had advised that such an appeal could only be based on a procedural or legal error by the planning inspector and that M only had one such argument that might succeed. Nevertheless, M insisted that the case be argued on a wider basis by reference to the planning merits of the case and the safeguarding of the environment. B terminated the retainer and sought payment of their fees up to that point. The fees were assessed by a costs judge, who held that B should not have terminated their retainer even though they were of the view that M’s instructions were ‘doomed to disaster’, and that as they had been retained for ‘the entire business’ of the statutory appeal they were not entitled to recover any costs other than disbursements. On appeal B argued that M had instructed them to advance an improper case so that they were not only entitled to cease acting, but had a professional obligation to do so under regulation 12.12 of the Solicitors Practice Rules 1990. The judge agreed with the costs judge that M’s instructions were not improper and that B had not been entitled to terminate the retainer. The main issue on appeal was whether a solicitor had ‘good reason’, pursuant to rule 12.12 of the Solicitors Practice Rules 1990 and rule 2.01(2) of the Solicitors Code of Conduct 2007, for terminating a retainer if a client insisted on his putting forward a case and instructing counsel to argue a case that was ‘doomed to disaster’ or which the solicitor believed was ‘bound to fail’.

Held: (1) There was no comprehensive definition of what amounted to a ‘good reason’ to terminate in the rules or code, because it was a fact-sensitive question. It was wrong to restrict the circumstances in which a solicitor could lawfully terminate his retainer to those in which he was instructed to do something improper, Underwood Son & Piper v Lewis [1894] 2 QB 306 CA considered. Solicitors should not lightly be able lawfully to terminate their retainers, but the desirability of protecting a client from an arbitrary and unreasonable termination was not a sufficient justification for such a narrow interpretation of the phrase ‘good reason’ as the judge had given in the instant case. It might be difficult to draw the line between an argument that could properly be articulated and put forward but which had little or no prospect of success, and an argument that could properly be articulated and which was believed to be bound to fail. However, it was clear from the Bar Code of Conduct that counsel could not draft any document, or make any submission, containing a contention that he did not consider properly arguable. A corresponding provision appeared in rule 11.01(3) of the Solicitors Code of Conduct 2007. Although there was no similar express provision in the rules, it would have been understood by all solicitors, as officers of the court, that they were under a professional duty: (i) not to include in the court documents that they drafted any contention that they did not consider to be properly arguable; and (ii) not to instruct counsel to advance contentions that they did not consider to be properly arguable. Further, rule 1.3 of the CPR required the parties to help to further the overriding objective of enabling the court to deal with cases justly, which would not be furthered by the parties advancing hopeless arguments.

(2) It would be improper in a statutory planning appeal to advance an argument based on the merits of the decision by the planning inspector, which was hopeless and not genuinely arguable. As M had insisted that such arguments be advanced, B had good reason for terminating the retainer. The retainer was an entire contract that had not been completed, but as it had been terminated for good reason B were entitled to their proper costs and disbursements for work done prior to the termination, Vansandau v Browne 131 ER 667 CCP and Underwood considered.

(3) (Per curiam) If an advocate considered that a point was properly arguable he should argue it without reservation. If he did not consider it to be properly arguable, he should refuse to argue it. He should not advance a submission but signal to the judge that he thought it was weak or hopeless by using the coded language ‘I am instructed that’. Such coded language was well understood as conveying that the advocate expected it to be rejected. Such language should be avoided.

Appeal allowed.

Richard Buxton for the appellant; in person for the respondent; Richard Drabble QC, David Holland (instructed by Mills & Reeve) for the intervener.