The case of Ghising v Secretary of State for the Home Department 2015 (Click here for the Judgment) is an interesting case to read in relation to retrospective success fees.
The case is useful to consider as it sets out the current law on retrospective success fees, which can be summarised as follows:
- Retrospective success fees are not contrary to public policy
- Whether a retrospective success fee is recoverable is a matter for the Court on a case by case basis
In the ‘Ghising’ case the Honourable Mrs Justice Patterson DBE (sitting with costs assessor Master O’Hare) determined that the retrospective success fee was recoverable.
It is clear from reading the Judgment that the key reasons for the allowance of the retrospective success fee were:
- Even if the Paying Party had been aware of the existence of the CFA for the retrospective period it would not have made any difference i.e. the Paying Party would not have acted any differently.
- Prospects of success in the case did not change from the date the CFA was retrospective to and the date of the CFA
It is well worth reading the Judgment as it demonstrates the intricacies and case specific detail that must be considered when dealing with the issue of a retrospective success fee.
The decision is a positive one for Receiving Party’s as it essentially supports the allowance of a retrospective success fee where the prospects of a case do not change (for the retrospective period to the date of entry of the CFA) and the opponent would not have acted any differently had they been aware of the retrospective period.
My experience of the assessment of retrospective success fees is very inconsistent. It is definitely one of the areas of costs law which is difficult to predict in advance of a detailed or provisional assessment hearing. Costs Judges are often uncomfortable with allowing a Receiving Party a success fee for a period before the Paying Party was aware of the existence of a CFA, particularly where the retrospective period is of a substantial length. Costs Judges tend to be more relaxed about a retrospective success fee where the retrospective period is short. This is probably because it is likely that the case prospects would not have changed in a short retrospective period and the amount of the retrospective success fee will be nominal.
If anyone has any recent experiences of retrospective success fees (allowance or disallowance by the Court) then please feel free to share them through this blog.
Andrew McAulay is a Costs Lawyer and Partner at Clarion. He is the Head of the Costs and Litigation Funding team. He can be contacted on 0113 336 3334 or at email@example.com.