0370 270 6000

already registered?

Please sign in with your existing account details.

need to register?

Register to access exclusive content, sign up to receive our updates and personalise your experience on brownejacobson.com.

Privacy statement - Terms and conditions

Forgotten your password?

Fosberry & Fosberry & BJ Rice & Associates v Revenue & Customs, High Court, 25 May 2007

14 March 2008
The issues

Conditional Fee Agreements Regulations 2000 Regulation 3; Regulation 4 – whether Conditional Fee Agreement enforceable.

The facts

The Appellants were Chartered Tax Advisors and Accountants who acted for the Fosberry’s and their Appeal to the VAT and Duties Tribunal against a refusal to register them for VAT purposes. They acted under a CFA with the Fosberry’s. The Revenue and Customs Commissioners withdrew from the Appeal and agreed to pay the Fosberry’s reasonable costs. The CFA provided for a standard charging rate and a capped sum if the Appeal was unsuccessful. If the Appeal was successful the agreement provided for a 55% uplift with no cap on the amount recoverable. At the Costs Hearing the Master found the CFA unenforceable. He found the agreement did not comply with Regulations 3(2)(c) or Regulation 4 of the Regulations.

The receiving party appealed.

The decision

The CFA was dated 14th June 2002. It was a two page document with a Schedule occupying two-thirds of a third page. It did not appear to have been drafted by a lawyer. On the basis of Hollins v Russell the Court had to consider whether any breaches were immaterial or whether they had some material effect on either consumer protection or the proper administration of justice. Minor and trivial breaches would not be significant. Garrett v Halton established that there could be a material breach of the statute or of the Regulations so as to render the agreement unenforceable, even in the absence of detriment to the client.

The agreement was deficient in two ways. The uplift referred to in the agreement failed to comply with Regulation 3(1)(b). The uplift purported to reflect time and delay risks that attached to the Appeal but failed to specify what element of the 55% applied to the delay.

Secondly, the wording of the agreement failed to make clear what would happen if the agreement terminated prematurely. This was contrary to Regulation 2(1)(c)(iii).

Looking at the failings of the CFA globally they had the effect of preventing substantial compliance. They had significant effects in terms of consumer protection and the delay compensation point also had significant administration of justice implications. They could not be characterised as slight matters. Taken in aggregate they represented an overall significant and important shortfall. If it mattered, the Court considered that the delay point was sufficient by itself to have brought the agreement down.

Appeal dismissed.

Focus on...

Legal updates

Gosden and another v Halliwell Landau and another [2021] EWHC 159 (Comm)

This claim addressed the question, of when the date for assessment of damages in cases of negligence should be determined and shows that when appropriate the Courts will depart from the default position.


Legal updates

Assessing the scope of employers liability – Chell v Tarmac

These were the opening remarks of Mr Justice Martin Spencer when handing down his Judgment in the recent case of Andrew Chell v Tarmac Cement and Lime Limited [2020] EWHC 2613, the latest in a series of appeals dealing with the scope of vicarious liability.


Legal updates

Non-payment of insurance premiums during the Coronavirus pandemic

The forced closure of many businesses as a result of the Coronavirus pandemic has had a huge impact on the nation’s Gross Domestic Product (GDP). Recent reports from the Office for National Statistics state that the economy was 25% smaller in April than it was in February this year.


Legal updates

Reinstatement for property damage losses – when does it apply?

The Court of Appeal has recently considered the correct test for measuring the indemnity for property damage losses and has provided useful guidance on whether an insured needs to intend to reinstate the property to its pre-loss condition.


The content on this page is provided for the purposes of general interest and information. It contains only brief summaries of aspects of the subject matter and does not provide comprehensive statements of the law. It does not constitute legal advice and does not provide a substitute for it.

Mailing list sign up

Select which mailings you would like to receive from us.

Sign up