Case No: C/2001/1760
 
Neutral Citation Number: [2001] EWCA Civ 2010
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM QUEEN’S BENCH 
ADMINISTRATIVE COURT 
(Mr. Justice Ouseley)
Royal Courts of Justice
Strand, London, WC2A 2LL

Date: 20th December, 2001 

B e f o r e :

LORD JUSTICE SIMON BROWN
LORD JUSTICE WALLER
and 
LORD JUSTICE SEDLEY
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	LEGAL SERVICES COMMISSION	Appellant	
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	THE QUEEN
On the application of AUGUSTINE MACHI	Respondent	

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(Transcript of the Handed Down Judgment of
Smith Bernal Reporting Limited, 190 Fleet Street
London EC4A 2AG
Tel No: 020 7421 4040,  Fax No:  020 7831 8838
Official Shorthand Writers to the Court)
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Mr. J. Harvie QC and Mr. A. George (instructed by Legal Services Commission, Policy & Legal Department for the Appellant)
Mr. P. Havers QC (instructed by Leigh Day & Co.  for the Respondent

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Judgment
As Approved by the Court

Crown Copyright ©

Lord Justice  Sedley: 

1.	Mr. Machi was injured at work.  His solicitors, Bindman and Partners, obtained a full legal aid certificate to sue his former employers in the County Court.  Liability was known not to be a serious issue.  The case was listed for trial on 8th June 2000, and the certificate was duly amended to allow all steps up to and including trial.  Counsel advised that any offer of £9,000 or above should be taken seriously.  When on 1 June £10,000 was offered, both counsel and solicitor firmly advised Mr. Machi to accept it.  He refused.  
2.	The Civil Legal Aid (General) Regulations 1989, which governed and continue to govern Mr. Machi’s certificate, although they have been superseded in relation to more recent certificates by regulations made under the Access to Justice Act 1999, provide as follows:
“Duty to report abuse of legal aid
67.	(1)	Where an assisted person’s solicitor or counsel has reason to believe that the assisted person has –
(a)	required his case to be conducted unreasonably so as to incur an unjustifiable expense to the fund or has required unreasonably that the case be continued;
or
(b)	intentionally failed to comply with any provision of regulations made under the Act concerning the information to be furnished by him or in furnishing such information has knowingly made a false statement or false representation, 
the solicitor or counsel shall forthwith report the fact to the Area Director.
(2)	Where the solicitor or counsel is uncertain whether it would be reasonable for him to continue acting for the assisted person, he shall report the circumstances to the Area Director.
…………………….
Duty to report progress of proceedings
70(1) An assisted person’s solicitor and his counsel (if any) shall give the Area Committee such information regarding the progress and disposal of the proceedings to which the certificate relates as the Area Director may from time to time require for the purpose of performing his functions under these regulations and, without being required to do so, the assisted person’s solicitor shall –
(a)	make a report where the assisted person declines to accept a reasonable offer of settlement or a sum which is paid into court……
3.	Accordingly Bindman and Partners reported to the successor of the Legal Aid Board, the Legal Services Commission (LSC), that in their view and counsel’s the claimant had unreasonably refused an offer of settlement.
4.	The LSC consequently telephoned Bindman and Partners on 5 June to place an embargo on any further work and then, though only after its computer had twice generated the wrong letter, sent Mr. Machi a letter dated 7 June 2000  which read as follows:
“Dear Mr. Machi
I am considering whether you should continue to receive public funding for your case or whether I should discharge the certificate.
Your case has been reviewed in the light of the settlement proposals which have been made and it is considered that a fee paying client of moderate means would be advised to settle.  If I discharge the certificate, it is cancelled and your case will no longer be publicly funded.
Until I make our decision, no more work can be done under the certificate unless it has first been approved by me.
If you want the certificate to continue, you must write to this office using the attached form, and I must receive your reply by 21 June 2000.
If you have any questions about this letter, you should telephone me on the number shown at the top of this letter.  If you telephone me please be ready to tell me your case reference number.
Your solicitor has received a copy of this letter and the attached form. You may want to speak to your solicitor before you reply to me.”
5.	I have italicised the crucial paragraph. The opportunity which the letter offers to resist the proposed discharge of the certificate is made mandatory by Regulation 81. Although his solicitors had told him of the embargo on 5 June, the letter did not reach Mr Machi until after 8 June.
6.	Meanwhile Bindman and Partners, understanding themselves to be unable by reason of the embargo to take any further steps, were obliged to let Mr Machi go to court on his own.  At the door of the court he was offered £15,000 plus his costs, which he accepted in full settlement.   
7.	With the benefit of fresh funding from the LSC, Mr Machi then brought the present proceedings in the Administrative Court.  He seeks a finding that the effective discontinuance of his legal aid on the eve of the trial of his action was unlawful.  He goes on to seek damages based chiefly on his assertion that the sum for which he settled was less than he would have achieved had he gone to trial with proper representation.  
8.	The case came before Ouseley J on the question whether the LSC had acted unlawfully, unfairly or irrationally. The LSC not only contested these allegations but asserted that the proceedings in their limited form were futile. The judge, in a closely reasoned judgment, concluded that the issues, although limited, were not academic or pointless; that there was no power in law to place an embargo on a full legal aid certificate pending its possible discharge;  that if there was such a power, it had been exercised unfairly by not letting Mr Machi first contest the imposition of an embargo;  but that, these things apart, the decision to put the embargo in place had not been unlawfully delegated and was not irrational.  
9.	The LSC with the judge’s leave appeals to this court against the three findings adverse to it.  Mr Machi not only supports these findings but seeks to add back irrationality.
10.	The case, as sometimes happens, has changed shape more than once in the course of argument.  By the end, it was common ground that the single critical question is whether the LSC has under the Legal Aid Act 1988 and the Civil Legal Aid (General) Regulations 1989 (SI 1989 No. 339) a power, however described or classified, to give the direction contained in the third paragraph of its letter to Mr Machi of 7 June 2000.
11.	Section 4(1) of the Legal Aid Act 1988 provided as follows:
“Powers of the Board
4.	(1)	Subject to the provisions of this Act, the Board may do anything –
(a)    which it considers necessary or desirable to provide or secure the provision of advice, assistance, mediation and representation under this Act;  or
(b)	which is calculated to facilitate or is incidental or conducive to the discharge of its functions;
and advice, assistance, mediation and representation may be provided in different ways in different areas in England and Wales and in different ways in different fields of law.”
12.	Section 15(4) provided:
“Representation … may be granted by the Board with or without limitations and may be amended, withdrawn or revoked.”
13.	Section 34(1) provided:
“The Lord Chancellor may make such regulations as appear to him necessary or desirable for giving effect to this Act or for preventing abuses of it.”
14.	As has already been seen, the letter to Mr Machi cited no specific source of power.  In his affidavit to the court, Mr Browne, a solicitor in the Policy and Legal Department of the LSC, said:
“In most circumstances an assisted person must be given notice and the opportunity to “show cause” why his legal aid certificate should not be discharged (Regulation 81 of the 1989 Regulations).  Under Section 4 of the 1988 Act the Commission has power to do anything “which is calculated to facilitate or is incidental to the discharge of its functions”.  The Commission exercises this power in certain circumstances in order to protect public funds by asking an assisted person’s solicitors not to undertake any further work under a legal aid certificate pending determination of the “show cause” procedure.  This is commonly referred to as the Commission placing an “embargo” on further work under the legal aid certificate. If, however, limited urgent work is necessary the Commission will often agree to that work being undertaken.  A relatively common example of such further work is an application for an adjournment of the hearing.”
15.	Mr Jonathan Harvie QC for the LSC accepts, indeed asserts, that the Regulations contain no express power to impose an embargo while revocation or discharge of a full certificate is considered.  This is in sharp contrast to the emergency certificate procedures.  These include, by Regulation 75(5), a requirement that no emergency certificate is to be revoked without notice to the assisted person and an opportunity to show cause why revocation should not happen.  There then follows this provision:
“(6)  Where notice is served under paragraph (5), no further work may be done or steps taken under the certificate unless authorised by the Area Director.”
16.	Mr Philip Havers QC for Mr Machi submits that the judge was right to conclude that the presence of this power in relation to emergency certificates and its absence in relation to full certificates, in Regulations which are in this regard comprehensive, excluded the exercise of any residual power under Section 4(1).  Ouseley J said:
“50.	In my judgment, there is no power to impose an embargo.  I accept Mr George’s argument that the prevention of abuse is a necessary part of the Legal Services Commission’s function in section 3(2) and section 4, and that the imposition of an embargo on further work being done pending consideration of the discharge of a legal aid certificate can properly be regarded as ancillary to that function.  The question is whether as a matter of construction of sections 3, 4 and 34 and of the Regulations, the ancillary power which would otherwise exist has been removed.
51.	Section 4 provides that the existence of the powers in section 4(1)(b) is “subject to the provisions of this Act”; those provisions include section 34 which empowers regulations to be made for the purposes which I have set out already.  I do not consider that the mere existence of a regulation-making power in those terms or the mere fact that it has been exercised of itself cuts down or removes the general ancillary power.  However, section 34, together with the Regulations which have been made under it, are provisions subject to which section 4 must be read.
52.	The actual regulations made under section 34 do expressly provide the means whereby the abuse of public funds through the unreasonable continuation of litigation is to be prevented.  They provide expressly for an embargo where an emergency legal aid certificate has been granted and its revocation is contemplated.  The Regulations provide a procedural structure in Regulation 81 for the discharge of a full certificate in circumstances where it is unreasonable for legal aid to continue by reference to Regulation 77 and in other circumstances related to the merits.  Discharge on financial grounds and discharge for abuse of legal aid is also provided for.  The procedural requirements apply or apply with variations depending on the grounds of discharge.  Depending upon which ground for revocation or discharge of the full legal aid certificate is relied on, notice must be given and an opportunity to show cause against the revocation or discharge must also be given.
53.	Where such express procedural provisions exist, I do not consider that the Regulations should be regarded as containing or retaining an implied embargo power simply because it has not been expressly removed.  Indeed, the contrast with the expressly permitted embargo pending the revocation of an emergency certificate strongly supports Mr Singh’s submission that any power of embargo pending consideration of the discharge of a full certificate has been impliedly excluded, because it has not been provided for.
54.	The general power in section 4(1)(b) cannot be regarded as continuing to contain such a power in the light of the Regulations.  Were that so, the Regulations would provide a rather uncertain and incomplete structure and guide as to the powers of the Commission to deal with discharge on its merits or for abuse.  Anything not forbidden expressly would be permitted, with whatever effect on the assisted person’s proceedings or trial that might have.  I do not consider that Parliament can have intended a legally assisted person to be in such a position.  Are there, for example, other grounds upon which a certificate can be discharged on its merits?  These Regulations contain in their express provisions and in any which are necessar[il]y implied the complete statutory code for the discharge of certificates and related procedures; and embargo is not permitted in these circumstances.
55.	I also consider that my conclusion is supported by the fact that the embargo as operated is curiously one sided in its effect.  The legally assisted person cannot use another solicitor nor obtain private funding from any source to pay his existing solicitor.  He may be unable to obtain his papers from the solicitor.  The statutory charge remains to protect the Commission yet all the damages and costs awarded after the embargo takes effect, including any extra sums entirely attributable to the assisted person’s unaided efforts, are available to meet the statutory charge.  If an embargo power were to have existed, I would have expected specific provision to deal with those problems which could, in combination, seriously prejudice a litigant’s right to carry on his claim at his own expense or in person and could prejudice the fairness of the trial of his action.”
17.	Mr Harvie contends that the specification by Regulation of certain powers does not diminish the generality of the statutory powers and discretions vested in the LSC.  Before the judge, his junior, Mr. George, allocated the material power to section 4(1).  Before us, Mr. Harvie has sought to allocate it to section 15(4).  An embargo was, he first submitted, a withdrawal of representation within that provision.
18.	The presence in s.15(4) of the word “withdrawn” is something of a mystery.  It is not a term of art in the statute, and as a matter of ordinary English its meaning does not perceptibly differ from the alternative, “revoked”, which follows it.  The Regulations, moreover, do not use the word.  It was suggested to Mr. Harvie in argument that the letter of 7 June 2000 might more fittingly have constituted the amendment of a limitation on the certificate within the meaning of the same sub-section.  Mr Harvie, probably wisely, submitted that it did not matter: there was nothing in the Regulations to say that an embargo could not be put upon representation while revocation or discharge was duly considered, and a variety of powers in the Act which legitimated such a course. The Legal Aid Board and its successor had been acting lawfully, if Mr Harvie was right, without knowing how or why.
19.	We were invited to consider the decision of this court in R. on the Application of the Legal Services Commission v. Burrows (12 February 2001).  There the issue revolved around a costs limitation in a legal aid certificate.  Such limitation is provided for in section 15(4) of the 1988 Act, but is nowhere dealt with in the Regulations.  In consequence Dyson LJ, giving the single reasoned judgment, said:
“At one stage I thought that it might have been arguable that section 34 and the provisions to which I have referred indicated that it was intended by Parliament that all aspects of the regulation of the remuneration of legal representatives were to be the subject of regulations made by the Lord Chancellor.  Mr Spon-Smith did not, however, advance such an argument.  It is true that the provisions of section 34 are wide enough to empower the Lord Chancellor to make regulations authorising the Board to restrict the costs of representation, and Regulation 48 seems to be the only example of such a regulation.  But in my view the fact that section 34 gave the Lord Chancellor such a power, amongst others, does not permit the inference that the Board was not empowered to impose costs limitations under section 15(4).  The language of section 34 simply does not justify such an inference.”
20.	In the present case, by contrast, the Regulations are full and explicit in relation to the process of revocation and discharge of legal aid certificates.  Regulation 74(2) draws the distinction between the two things: revocation means that the applicant is deemed never to have been an assisted person except in relation to the recovery of costs by an unassisted opponent; discharge operates only from the date of the decision to withdraw legal aid.  The revocation and discharge of emergency certificates is dealt with by Regulation 75, and as noted above the final two paragraphs of this regulation make explicit provision for an embargo pending due consideration of the appropriateness of revocation (but not, interestingly, of discharge) for reasons of non-cooperation. Where the revocation or discharge of a full certificate is contemplated, Regulation 81 forbids either step until the assisted person has been given notice of the proposal and an opportunity to show cause why a certificate should not be revoked or discharged.  This was one of the purposes of the letter of 7 June 2000 in the present case.  No interim power of embargo analogous to that in Regulation 75(6) is spelt out in relation to full certificates.  
21.	In this situation there are powerful reasons for concluding that the Lord Chancellor has set out to provide in the Regulations a comprehensive code which tells the LSC, the assisted person and the assisted person’s lawyers equally exactly where they stand when the withdrawal of a certificate becomes a possibility. While the Regulations are not in the present circumstances an aid to the construction of the Act (cf Hanlon v. Law Society [1981] AC 124, per Lord Lowry), the statute is nevertheless given shape and definition by regulations which spell out in interlocking form the specific ways in which the wide statutory powers may be exercised. Thus far Ouseley J’s reasoning is unshaken.
22.	But the question placed by Mr Harvie at the centre of his argument is this: what control then remains to prevent a solicitor from incurring fruitless expense in the interval between the giving of notice of possible withdrawal and the eventual decision to revoke or discharge?  His case, supported by the evidence of Mr Browne quoted above, is that the LSC is able and always willing to modify any embargo so that appropriate steps can be taken – for example applying for an adjournment – to protect the assisted person’s position.  By contrast, Mr Harvie submits, there is nothing to protect the fund if there is no implicit power of embargo.  The assisted person will continue to have the right to expend public funds while he or she argues about the propriety of withdrawing his or her certificate.
23.	These troubling submissions become more powerful when one considers, as counsel were invited in the course of argument to consider, that the meaning and effect of the Regulations must be the same both in a case like the present, where the very lateness of the proposal to discharge the certificate, coupled with the requirement of due process in making the decision, places the assisted person and his lawyers in an impossible situation, and in a case where, say six months before trial, a good offer is made shortly before a costly conference with experts is due to be held, and against the lawyers’ advice is refused by the assisted person.  
24.	If there were no form of control in the Regulations, one might well infer that the Regulations were not intended to be comprehensive, and that the general powers of management in the statute retained a residual effect.  But it is not quite so.  
25.	The duty set out in Regulations 67 and 70 (quoted above) to report unreasonable conduct rests squarely upon the assisted person’s lawyers.  If, as on the face of the Regulations appears to be the case, neither the lawyer’s report to the LSC nor the LSC’s giving of notice to the assisted person operates by itself to suspend representation, it is the solicitor (advised where appropriate by counsel) who will have to decide what expenditure can properly be incurred in the interim.  This may not be an ideal scenario but it is not an illogical one.  The solicitor will have a much closer appreciation of what is essential and what is dispensable at the stage which the litigation has reached.  There is nothing inherently less appropriate in the solicitor’s deciding whether, say, to seek an adjournment while revocation is considered than in the LSC’s deciding whether to permit it.  In the non-urgent scenario, there is equally nothing inherently less appropriate in the solicitor’s deciding whether it is sensible and practical to defer the conference with experts than in the LSC’s deciding whether to allow it to go ahead. 
26.	If in such a situation the solicitor is pressed by an intransigent client to go on regardless, with the risk that the solicitor will be acting unprofessionally by incurring unwarranted public expense, Regulation 69(3) provides the exit route:
“Without prejudice to any other right of a solicitor or counsel to give up a case, any solicitor or counsel may give up an assisted person’s case in the circumstances specified in Regulation 67.”
It is true that the succeeding two paragraphs of Regulation 69 set out oddly schematic consequences: the exercise of the right to give up a case under paragraph (3) calls for a report to the LSC, and where following such a report the LSC declines to discharge or revoke the certificate, there will be an obligatory change of assigned solicitor.  
27.	Mr Harvie points out with justice that it is at their own risk that solicitors would have to decide whether or not to take steps pending a decision on withdrawal of legal aid.  If they put everything on hold they may be held liable by their client for consequent loss of litigation opportunities.  If they go ahead, they may be castigated by the LSC for unjustifiably spending public funds and, in a bad case, be accused of unprofessional conduct in so doing.
28.	These are powerful, but in my judgment not in the end conclusive, considerations.  There are many situations in which lawyers have to make judgments that are capable of landing them in trouble if they get them seriously wrong. While without doubt the Lord Chancellor could intelligibly have made express provision in the Regulations for the scheme of things for which Mr Harvie contends, it seems to me that he has instead chosen to make the provision in relation to revocation, discharge, due process and interim expenditure which is described above and can be properly described as comprehensive.  If so, it leaves no room for a residual fund of powers within the generality of sections 4(1) or 15(4).  Each of these by virtue of section 34(1) is to be read with the Regulations, so long as these are intra vires.  It would do much to frustrate the purpose of the rule-making power if those affected by the Act – whether the LSC, assisted person or the assisted person’s lawyers – were able to fall back upon the broadly cast statutory functions on the ground that because these are capable of being performed otherwise than the Regulations prescribe, the Regulations represent simply one elective way of carrying them out. 
29.	It does not follow that the entire burden of judgment and risk is displaced on to the solicitor. There is no reason why the LSC should not include in its pro forma letter a reminder to the solicitor that although the certificate remains in being, any interim expenditure must be strictly needed, and pointing out that the Commission’s agreement can be sought by telephone if there is doubt. The difference between this and the existing practice described in Mr Browne’s evidence is very small. The legal difference, however, is that it takes place within a comprehensive and not an open-ended withdrawal regime. 
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30.	Although in these circumstances it is unnecessary to deal with the remaining issues, both counsel have been prepared to leave them to us on the basis of the written arguments.  For completeness, therefore, I would make the following brief observations.  
31.	If the Regulations, properly construed, empowered the LSC to do what it did, did it go about the task fairly?  Ouseley J held that it did not, and I agree.  The question is one of procedural fairness.  It gains nothing by being cast in terms of legitimate expectation.  Ouseley J. did not think that the right of access to a court under Article 6 of the European Convention on Human Rights was engaged.  He may not have been right about this, at least to the limited extent that there must not be an arbitrary withdrawal of means of access to the court which the State has accepted are necessary for the particular claimant; but nothing suggests that the standard of fairness which this carries with it outranks that set by the common law.  If, as the judge considered, the necessary steps could be rapidly taken (for example by telephone) to see whether it really was appropriate to impose an embargo on representation at the eleventh hour, there is nothing in a case such as the present to contra-indicate a requirement of common fairness that such steps should be taken.  This is particularly so when the effect of an embargo is going to be indistinguishable from the effect of discharge - in fact rather worse, in that it would prevent the claimant from responding to the crisis either by going to other solicitors who might be prepared to act without being put in funds or from borrowing or raising his own funds in substitution for legal aid, while continuing to give the fund first call on everything the claimant might go on to recover at trial. 
32.	 The LSC’s written submission that “The requirement merely prevented further work being done until such work was authorised by the Area Director” is, with respect, sophistry in the situation facing Mr Machi on the eve of trial. The reality is that an embargo imposed on the eve of trial leaves an assisted claimant high and dry. It means among other things that the defendant who makes an offer too late to come within CPR Part 36 gets an unearned bonus at the claimant’s expense. It cannot have been fair in these circumstances to react to the solicitor’s entirely proper report with an instant embargo on representation. The need for the claimant to be able at the very least to apply next day for an adjournment was obvious; and it was by no means obvious that it would have to be at his own cost, given the lateness of the offer that had brought it about. None of this, however, is to prejudge the question of damage or loss in the present proceedings.
33.	The claimant seeks also to revive his unsuccessful submission, made below, that the imposition of the embargo was irrational. It may not have been enough to hold, as the judge did in rejecting this submission, that the issues for trial were simple, the forum modest and the situation one in which an offer had been turned down in defiance of the advice of experienced lawyers. If the Regulations had left in being a discretionary power to impose an embargo in circumstances such as had occurred here, it seems to me that Mr Rabinder Singh was right in his submission to Ouseley J that to exercise it at the eleventh hour with the effects described above was not only unfair but unreasonable in the strong public law sense: in other words, an abuse of the power. But if, as I would hold, there was no such power, the question is moot.
34.	There remains a now abstract set of arguments about futility.  Before Ouseley J the LSC contended that the claimant’s application was futile.  The judge agreed that the primary and delegated legislation in issue were now both superseded, but considered that the claimant still needed his decision as the foundation of the admittedly inchoate private law claim.  In this court the LSC has sought to re-run the argument: but once a reasoned decision of the Administrative Court had been delivered on the questions of illegality and fairness, the argument itself became futile.  Why else would the LSC have decided to expend public funds on the present appeal in order to secure a decision on the meaning and effect of the Act and Regulations?  
35.	I would dismiss the appeal.
Lord Justice Waller:
36.	I agree that this appeal should be dismissed essentially for the reasons given by Sedley LJ.  
37.	I accept that it is possible to spell out of sections 4 and 15 of the primary legislation the power to “withdraw” and the power to “revoke”.  I accept further that the placing of an embargo can legitimately be seen as subsumed in the express power to withdraw.  But without the regulations it would have been necessary to spell out by implication the circumstances in which it was fair to exercise any of the above powers, and the steps required to be taken so as to produce fairness in the exercise.  As regards withdrawal or revocation it would have been so necessary.  In relation to an embargo similarly it would be necessary by implication to define the circumstances in which the imposition of an embargo would be legitimate.  For example, would it be legitimate to impose an embargo while the question of withdrawal or revocation was considered without having formed any view as to whether without the embargo unreasonable expenditure was about to be incurred?  Would it be reasonable to impose an embargo in such circumstances without giving the assisted person an opportunity to show cause?  
38.	It seems to me quite clear that the regulations have spelt out the circumstances in which it is fair to withdraw or to revoke.  They have further spelt out the steps to be taken to achieve fairness where withdrawal or revocation is contemplated.  Furthermore, they have set out one very narrow circumstance when an embargo will be placed on the further expenditure of money while an assisted person shows cause why a certificate should not be revoked, and that only in the case of an emergency certificate.  
39.	Regulation 75(3) states: 
“The Area Director may revoke or discharge an emergency certificate if he is satisfied that the assisted person has failed to attend for an interview or to provide information or documents when required to do so under these Regulations, or has failed to accept an offer of a substantive certificate.” 
40.	Regulation 75(5) states: 
“No emergency certificate shall be revoked under paragraph (3) until  - 
(a) notice has been served on the assisted person and his solicitor that the Area Director may do so and that the assisted person may show cause why the certificate should not be revoked, and 
(b) the assisted person has been given an opportunity to show cause why his certificate should not be revoked.”  
41.		Regulation 75(6) states: 
“Where notice is served under paragraph (5), no further work may be done or steps taken under the certificate unless authorised by the Area Director.” 
42.	Thus it is that those who framed the regulations clearly had in mind the possibility that in certain circumstances an embargo might be required while an assisted person showed cause.  
43.	Certain of the regulations deal with circumstances in which there can be withdrawal without any opportunity to show cause (see Regulation 76, Regulation 80(a)(b)(c) (i)(iii) and (iv) and Regulation 81).  I do not understand it to be suggested that the LSC should have a power of embargo where the circumstances fall within those regulations.  
44.	Certain of the regulations deal with circumstances where the assisted person does have a right to show cause (e.g. Regulations 77, 78, 79 and 81).  It is, as I understand it, pending consideration of whether there should be a withdrawal or revocation when the assisted person has the right to show cause, that it is suggested that the LSC should have the right to embargo further expenditure.  But I postulate  -  on what basis?  The answer would seem to me to be on the basis that otherwise unreasonable expenditure may be incurred.  But, if the circumstances in which an embargo is required are circumstances in which the assisted person may be requiring funds to be unreasonably expended, those circumstances seem to fall expressly within Regulation 77.  Why, one asks, if it was contemplated that fairness to the LSC should require an entitlement to impose an embargo without providing the assisted person with an opportunity to show cause, was that not spelt out in the regulations?  Putting it another way why should one continue to spell out of the provisions of the primary legislation a power to impose an embargo either without allowing a person to show cause or possibly with an opportunity to show cause when Regulation 77 and Regulation 81 appear to deal with the circumstances in which such an embargo would be necessary?  
45.	As it seems to me the regulations in this case are a complete code which are intended to deal with the withdrawing of legal aid spelling out expressly what would otherwise have to be implied into the express powers granted by the Act.  Once by regulation the powers are expressly circumscribed it seems to me that there is no room for continuing to imply powers and any implied circumscription.  
46.	Furthermore it seems to me that Sedley LJ is right when he points to Regulation 67 as demonstrating why the embargo that the LSC seek to impose is in reality unnecessary.  As already indicated, a right to place an embargo is not necessary other than in circumstances where there is a danger that a client is going to require funds to be spent unjustifiably or is requiring a case to be continued unreasonably.  Thus if the situation were that an offer of settlement were made some 6 months before a trial which the solicitor thought ought to be accepted, the solicitor would report that offer of settlement to the LSC under Regulation 70.  If before that had been considered by the LSC the client requested funds to be expended on the case which the solicitor thought was unjustifiable, the solicitor would refuse to expend that money and would again report that fact to the Area Director.  No doubt in discussion with the Area Director a decision would be reached as to whether it was justifiable to incur further expenditure while the LSC considered the offer.  Equally however if an offer were made so shortly before the hearing of a matter in court, as in the instant case, the question would still arise as to whether the litigant was requiring unjustifiable expense to be incurred.  If he was, the solicitor would not incur it.  Once again in discussion with the Area Director the question whether it was reasonable or not could be discussed.  
47.	I doubt whether a holding of no power to impose an embargo will produce results very different from those which should flow from the proper operation of Regulation 67.  Perhaps of more importance however, if the procedure under Regulation 67 is followed, then the LSC and the solicitor will be addressing the correct question not simply whether an embargo should be placed while the settlement offer is being considered and while the assisted person is given an opportunity to show cause.  They would be addressing the question whether in the particular circumstances unjustifiable expense was being required to be incurred and/or whether the solicitor was being unreasonably required to continue with the case.  
48.	The LSC, as I see it, are seeking to have the power to impose an embargo without regard to the circumstances of the case at the time when the embargo is to be imposed.  The power they seek is to impose an embargo while they consider the matter and without regard to the effect that that might have on the position of the assisted person.  The correct approach should always be to see whether the assisted person is requiring the unreasonable expenditure of funds and that question can be properly addressed under the present regulations without the necessity for the primary legislation being construed in the way contended for by the LSC.  
49.	Thus, in agreement with Sedley LJ, in my view the LSC acted unlawfully by simply imposing an embargo as they did.  
50.	There is nothing that I wish to add to the judgment of Sedley LJ on the remaining issues.  
Lord Justice Simon Brown:
51.	I share my Lords’ view that this appeal must be dismissed.  For my part, however, I would dismiss it by reference only to the second ground of decision below, Ouseley J’s conclusion that the power of embargo, assuming that it existed, was exercised unfairly in the particular circumstances of this case.  As to whether such a power exists with regard to certificates issued under the 1989 Regulations, I find myself in respectful disagreement with my Lords.
52.	The facts, law and arguments I gratefully take from Sedley LJ’s very full judgment.  My own, therefore, can be correspondingly short.  Let me proceed at once to the narrow but ultimately crucial point of disagreement between us.
53.	Had regulations never been made under section 34 of the 1988 Act, no one doubts that the LSC would have had a power of embargo under section 4(1)(b) and/or section 15(4) of the Act.  It is similarly accepted that a power of embargo could have been expressly provided for by the regulations -–just as the regulations expressly provide for an automatic embargo where an emergency certificate has been granted and notice of its proposed verification has been served under Regulation 75.
54.	The suggestion is, however, that because for the most part the regulations are full and explicit with regard to the process of revoking and discharging legal aid certificates, and particularly perhaps because no express provision is made for embargoes save only that under Regulation 75(6), the regulations are to be regarded in these respects as comprehensive and as leaving no room for any residual fund of powers in the primary legislation.  (The argument has to acknowledge that the regulations only have this effect in certain respects – see this court’s decision in Burrows, explained in paragraph 19 of Sedley LJ’s judgment).
55.	I cannot accept this suggestion.  It seems to me that unless the regulations as made are to be regarded as truly inconsistent with the exercise of the postulated residual power they cannot operate to oust that power.  That, of course, is the position where the regulations plainly cover the point in question – as, for example, with regard to the need to give the assisted person an opportunity to show cause why his certificate should not be revoked or discharged.  But I do not think that Regulation 75(6) can properly be regarded as exhaustive of all the circumstances in which an embargo may be imposed.  Regulation 75(6), it is important to note, provides not for a power of embargo, but rather, in one particular situation, for an automatic embargo.  Such a regulation does not seem to me inconsistent with the retention of a discretion to impose an embargo in other circumstances, a discretion, of course, only to be exercised when it is fair and rational to do so.  No doubt it would have been better had the regulations specifically provided for this power in addition to the automatic embargo provided for under Regulation 75.  But that is not to say that by omitting it from the regulations it was lost.
56.	There seem to me, moreover, strong policy reasons for the LSC having this power.  Take the situation envisaged in paragraph 23 of Sedley LJ’s judgment.  When the discharge or revocation of a certificate is under consideration, the decision as to what further work may be done ought, to my mind, to rest rather with the LSC than with the Solicitor himself.  As between him and his client it is difficult enough (although clearly appropriate) that he is required by Regulations 67 and/or 70 to report matters to the Area Director with a view to the certificate being discharged.  To require in addition that he takes the initiative, and the risk, of ceasing work meantime, would seem to me to ask too much of him.
57.	I would accordingly hold that the power of embargo continues to exist under the 1988 Act notwithstanding the making of the 1989 Regulations.  I would, however, hold that the power was unfairly exercised in the particular circumstances of this case and in the result, in common with my Lords, would dismiss the appeal.

Order: Appeal dismissed.  The order below to stand, save that for paragraphs 5, 		6 and 7 is substituted the direction that the claim for damages should be 	assigned to a master of the Queen's Bench division for directions, and with 	regard to paragraphs 8 and 9 the respondent to have his costs of the appeal, to be 	assessed in accordance with the 2000 regulation.  Application for permission to 	appeal to the House of Lords refused.
(Order not part of approved judgment)