Solicitor acting for impecunious client

Burstein v Times Newspapers Ltd (No 2) (CA TLR 6 December)

The claimant was awarded his costs of his successful libel action against the defendants. The defendants contended that when the claimant’s solicitors became aware that their client was no longer able to pay his costs, the agreement in their retainer that he would pay his costs became a sham and unenforceable. Accordingly, the defendants contended that the claimant had no liability towards his own solicitors for costs under the original agreement or under a subsequent conditional fee agreement. The defendants sought a full hearing and enquiry as to the validity of both agreements, at which they proposed that both the claimant and his solicitors should be examined. The judge and the Court of Appeal rejected those arguments, holding that the material produced by the defendants did not undermine the evidence of the claimant’s solicitors that the agreements were proper. The defendants’ proposition that a retainer was, or became, champertous, and therefore unlawful and unenforceable if a solicitor became aware at any time that their client could not have afforded to pay his costs, was a proposition which could not on the authorities be supported. On the facts there was nothing to suggest that the agreement between the claimant and his solicitors was a sham. The submission pre-supposed that maintenance and champerty were matters of general public importance, whereas the Access to Justice Act 1999 had largely swept away those principles.