Additional success for claimants in Inheritance Act cases

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There have been two fascinating cases recently where claimants in Inheritance (Provisions for Family & Dependants) Act 1975 cases have succeeded in persuading the Court that the defendants should pay their success fee liability.

Some Inheritance Act claims are brought under what are colloquially known as ‘no win no fee’ agreements (conditional fee agreements – CFAs).  When originally introduced, on “winning” the case, it was possible to reclaim the success fee (the lawyer’s reward for taking the risk of not getting paid) from the opponent. However, a few years ago, the rules were changed so that claimants had to pay the success fee out of their damages. That has remained the unchallenged position until two Inheritance Act cases, both decided in the last month, resulted in the defendants being ordered to pay the success fee.

In the first claim, Bullock -v- Denton, 28 April 2020, HHJ Gosnell ordered that the defendant should pay, amongst other things, a lump sum of £70,000 to the claimant. Within that calculation, £25,000 was included towards the success fee on her CFA that the claimant would otherwise have had to pay out of her damages to her solicitor and barrister. The Judge accepted that he should take Mrs Bullock’s liability to pay the success fee into account when considering her future liabilities under the Act.

Just nine days later, in re H (Deceased), Cohen J was asked to make an Order which included permitting a claim for the claimant adult child to recover a success fee totalling £48,174. He was referred to a 2019 decision where Deputy Master Linwood in re Clarke had declined to increase the award to include the success fee and to Bullock -v- Denton.

The Judge decided it was appropriate to consider that the success fee was part of the claimant’s needs. He took the view that it would not be fair to ignore the success fee given that it was one of her primary needs. Eventually, somewhat fudging the issue, he decided to allow some of the success fee sought in the sum of £16,750. It appears that the Judge may have regarded the percentage uplift that the solicitors sought as being slightly excessive.

That does put 1975 Act claims in a very interesting category. If one compares them to personal injury claims (where CFAs are frequently used to enable to Claimants to bring claims they couldn’t otherwise afford) the success fee is never recoverable. That means that from the amount that the Court has determined is required to cover a claimant needs, a sum must be deducted for the success fee. And yet here, the opposite result has now been achieved.

The decision is also contrary to the legislative policy which says that success fees are not recoverable.  Whatever one’s view of the policy, the decisions are hard to justify on the legislation and the case law as previously understood.

This leaves us in the position where claimants running Inheritance Act claims under a CFA will now push to have their success fee included in their damages, whereas defendants will seek to argue that Deputy Master Linwood’s arguments in re Clarke should hold sway.

Until the Court of Appeal rules on this issue, it certainly seems that there is scope for additional recovery in these cases and that, from now, a failure to seek recovery of the success fee could be regarded as negligent.

If you feel that you may have a claim under the Inheritance (Provisions for Family & Dependants) Act 1975, please contact our experienced team for advice on whether to proceed.