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Supreme Court on Assignments and Top-UP ATE

View profile for Nicholas Lee
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The issue of assignments of CFAs and top-up ATE insurance was considered by the Supreme Court in Plevin v Paragon Personal Finance Ltd [2017] UKSC 23.


Mrs Plevin entered into a CFA with her original solicitors in June 2008. Subsequently there were two technical changes of solicitor which arose out of organisational changes within the firm. Firstly in July 2009 the partners reconstituted themselves as an LLP and then in April 2012 it transferred its business to a limited company. The point taken by Paragon (no association with Paragon Costs Solutions) was that the CFA was not validly assigned. In dismissing this argument the Supreme Court unanimously concluded that the CFA was in principle assignable and had indeed been validly assigned.

Success Fee

Mrs Plevin and her solicitor entered into a deed of variation in August 2013 extending the CFA to cover the conduct of the appeal. There was then a further deed of variation extending the CFA to cover the appeal to the Supreme Court. The point taken by Paragon was that the variations created new agreements post 1 April 2013 and therefore the success fee for the Court of Appeal and Supreme Court proceedings should not be recoverable. In dismissing this argument, the Supreme Court concluded by majority that the deeds of variation were not a sham and an amendment of the existing CFA is a natural way of dealing with further proceedings in the same action.

ATE Premium

An ATE policy was taken out in October 2008. It was "topped-up" for the appeal to the Court of appeal and again for the appeal to the Supreme Court. The critical question was whether the two appeals constituted part of the same “proceedings” as the trial.

Lord Sumption concluded that the word “proceedings” had to be considered in the appropriate context which, in this instance, is section 46(3) of LASPO. In dismissing Paragon’s case by majority the Court commented that the effect, if the top-up premium was not recoverable, would be retrospectively to alter the balance of risks on the basis on which the litigation was begun. The topping up of ATE insurance was, in reality, part of the cost of bringing/defending the claim under the original policy.

Lord Sumption did however comment that for some purposes the trial and successive appeals do constitute distinct proceedings, in particular for the purpose of awarding and assessing costs.

Lord Hodge

The above conclusions were delivered by Lord Sumption with whom Lady Hale, Lord Clarke and Lord Carnwath agreed. However whilst Lord Hodge agreed with Lord Sumption on the question of assignments of the CFAs, he disagreed on the allowance of the success fee for the assigned CFAs and top-up ATE insurance. Lord Hodge interpreted the transitional provisions as protecting only the pre-existing contractual rights of the party to the proceedings and her expectation to recover the success fee, for which she and her lawyers had contracted before the commencement day, from the losing party. It followed that the amendments of the CFA and ATE premium would not, in his view, fall within the transitional provisions.

Click here for the full Judgment.