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	England and Wales Court of Appeal (Civil Division) Decisions
You are here: BAILII >> Databases >> England and Wales Court of Appeal (Civil Division) Decisions >> Pine v Law Society [2002] EWCA Civ 371 (20 February 2002) URL: http://www.bailii.org/ew/cases/EWCA/Civ/2002/371.html Cite as: [2002] EWCA Civ 371

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IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM ORDER OF HIS HONOUR JUDGE MADDOCKS
(Sitting as a High Court Judge)

		Royal Courts of Justice Strand London WC2 Wednesday, 20th February 2002

1. THE VICE CHANCELLOR: As I indicated earlier, we have dismissed the appeal thereby leaving Mr Pine to pursue his claim to assess the bills submitted to him for payment by the Law Society in respect of solicitors who have taken part in the intervention. It is accepted that in those circumstances the costs of Mr Pine's appeal should be the subject matter of detailed assessment and, in principle, the Law Society accepts liability to pay them.
2. The outstanding issue is whether or not to make a declaration of set off so as to enable the Law Society to set off its liability to Mr Pine for the costs of the appeal against a substantial liability of Mr Pine to the Law Society for costs in other proceedings. Mr Pine is liable to the Law Society for a total sum of approximately £70,000, much of which has been outstanding since 1997. It represents costs of the appeals brought by Mr Pine in disciplinary proceedings which have been wholly unsuccessful. Ordinarily speaking, therefore the discretion of the court would be exercised in favour of making the declaration sought. There are two features which are unusual and which, it is suggested, should lead us to different conclusions. The first is the fact that Mr Pine was unable to obtain legal aid for pursuing this appeal because the claim fell outside the present scope of the legal aid scheme. In the result, shortly before the hearing commenced, solicitors and counsel entered into a conditional fee agreement with Mr Pine - the terms of which we have not seen, but including, no doubt, a risk assessment. It was suggested by Mr Morgan that in those circumstances the solicitors would have a lien before the costs had been assessed and paid, exercisable as against the Law Society in respect of any sums due to them and Mr Morgan under the conditional fee agreement.
3. I am by no means satisfied that that is the case. It seems to me inherently inconsistent with the nature of a lien that it should be exercisable by solicitors for Mr Pine as against the Law Society before anything has been assessed or paid. I can well understand that it may be exercisable by solicitors against Mr Pine when the costs have been paid to Mr Pine's solicitors. I do not see that that feature should lead us to a different conclusion in this case.
4. The other feature is the bankruptcy petition. Relying on the substantial sum due by Mr Pine to the Law Society, a bankruptcy petition was served on Mr Pine in May 2001. In June further proceedings on the petition were stayed pending the outcome of this appeal. That stay will no doubt be removed and a bankruptcy order may be made. If a bankruptcy order is made there will be the usual set off, provided by Section 323 of the Insolvency Act 1996, between the mutual credits and dealings as they exist between Mr Pine and the Law Society at that time. That suggests that there will be a set off, in any event.
5. Accordingly, I do not see that the question of bankruptcy should lead us to a different conclusion.
6. I base my decision on the simple ground that I cannot see any reason, in justice, why Mr Pine, who has failed to pay the £70,000 owed by him to the Law Society, should not only be allowed to defer payment but require the Law Society to pay him, for the benefit of his lawyers, the sums due on this appeal. The lawyers on a CFA have to make their own risk assessment in the light of cases such as this. But, in the light of all other cases they undertake on this basis, the risk must fall on them. It is not a matter which should deflect the court from making what otherwise would be the appropriate order.
7. In conclusion, I recognise the considerable help Mr Morgan gave us. We are very grateful to him for his argument. It assisted us in reaching what I hope was a right decision. I would not wish anything I have said on costs to detract from that.
8. LORD JUSTICE ROBERT WALKER: I agree.
9. LORD JUSTICE RIX: I also agree.
Order: A minute to be lodged with court.