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Solicitor’s retainer not frustrated because client loses capacity, appeal judges rule

RCJ [1]

Richards LJ: “Commonplace” for clients to give instructions via agents

A solicitor’s retainer is not rendered “impossible of performance” simply because a claimant loses mental capacity and cannot give instructions personally, the Court of Appeal ruled today.

Upholding the High Court’s ruling [2] this time last year, Lord Justice Richards said it was “commonplace” for clients to give instructions through agents, such as accountants or spouses.

The court heard that Diann Blankley lost capacity, regained it and then lost it again during a clinical negligence claim.

Richards LJ said that in the case of Ms Blankley, the parties “must have contemplated” that there would be a further period of incapacity where instructions would be given by a litigation friend or deputy.

“The fact that supervening incapacity prevented the claimant from giving instructions personally did not render the contract of retainer impossible of performance,” he said.

“It simply gave rise to a short period of delay pending appointment of a receiver/deputy who could continue the conduct of the proceedings on the claimant’s behalf and give instructions to the solicitors for that purpose.”

Delivering judgment in Blankley v Manchester NHS Trust [2015] EWCA Civ 18 [3], Richards LJ said that if the claimant was under an obligation to give instructions personally, and later lost capacity, the situation would have been covered by the express terms of the conditional fee agreement (CFA).

He explained that this entitled the solicitors in that situation to terminate the contract and demand payment of their basic charges.

Richards LJ said the “unattractiveness of such a result” was “further indication that it cannot have been the intention of the parties that the claimant had to give instructions personally”.

The lord justice said he agreed with the reasons given by the High Court for concluding that the CFA was not frustrated.

He dismissed the NHS trust’s appeal. Lord Justice McCombe and Lady Justice Sharp agreed.

Sue Nash, chairman of the Association of Costs Lawyers, commented: “This is a common sense decision that recognises the practicalities of the situation where a client loses capacity.

“It will lead to swifter access to justice in that there will be no need to enter into a further funding arrangement and it should also avoid further satellite litigation.”