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Trading places with a CFA

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17 April 2019 / David Bailey-Vella
Categories: Features , Costs , Legal services
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David Bailey-Vella analyses Roman v AXA Insurance
  • When clients move from one firm to another can a conditional fee agreement be transferred?
  • The landmark ruling in Budana v Leeds Teaching Hospitals NHS Trust (Law Society intervening).
  • Far reaching practical implications and ramifications.

When clients move from one firm to another the valuation of work in progress (WIP) and the issue of costs recoverability, is never straightforward.

The core issues centre around whether a conditional fee agreement (CFA) can be transferred; and, if so whether the first firm will still be entitled to payment; and whether the additional liabilities under a pre Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO) CFA will be recoverable when a new agreement has been entered into after 1 April 2013.

There has been considerable technical argument as to whether or not it is possible to transfer a CFA; most of the argument has concerned the distinction between novation and assignment. It was thought that a CFA must be assigned for a pre LASPO

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