Bell & Anor v Brabners LLP

The central basis on which the Applicants seek permission to appeal, in what the skeleton argument rightly recognises are overlapping grounds of appeal, involves two key contentions.

On the basis of those two key contentions the Applicants, through Mr Meehan, submit that it is at least properly arguable with a realistic prospect of success that the Judge was wrong in law in respect of each of the three bases on which the Judge found the Respondent was entitled to terminate the Agreement. The answer, in the case of all three of those bases, is essentially the same. The Applicants say that, in the light of the clear and express terms of the Agreement – properly construed – there is no room: for section 65(2); or for repudiatory breach entitling termination for non-payment on account; or for the common law entitlement to terminate. The Applicants submit that it would be to rewrite the bargain between the parties for any of those three bases to be recognised. They submit that on the clear express terms of the agreement there is no basis for any “implication” of a term into the contract, citing Marks & Spencer v BNP Paribas Securities Services Trust Company (Jersey) Ltd [2015] UKSC 72 at paragraph 28. They rely on the principle articulated in the Richard Buxton case at paragraph 40: “Where the parties have agreed in what circumstances the solicitor may terminate the retainer, then the matter is governed by their contract”. The Applicants’ case is that it contradicts the express terms of the contract for any of the three bases to be identified and the Judge was wrong in law. There are some other points advanced by the Applicants to which I will return later.

The question for me is whether the appeal would have a real prospect of success or whether there is some other compelling reason for it to be heard (CPR 52.6). In my judgment, there is no realistic prospect of this appeal succeeding: it is not properly arguable that the Judge was wrong in law in resolving the preliminary issue in favour of the Respondent. I agree with Johnson J who also reached that conclusion.

In my judgment it is clear that the contract did not spell out that the sole consequence of non-payment on account was the Lien Consequence. The Agreement provides that lien may be exercised. It does not state that that is the sole or exclusive consequence.

Revealingly, and sensibly, Mr Meehan in his oral submissions today advanced the proposition – at least as an alternative position – that there would have been “other protections” for the Respondent, beyond the Lien Consequence, in circumstances of non-payment on account. Mr Meehan identified two such protections. The first was his submission that it would be open to the Respondent to have claimed the payment of monies due as a debt including by pursuing them in the courts, making a debt claim. As I put to him, that would – at least to some extent – involve the Respondent invoking the common law. The second protection for which Mr Meehan contended was the applicability of section 70 of the 1974 Act under which Parliament made provision entitling a solicitor to apply for an assessment in the context of a bill. That of course is an express statutory protection found within the 1974 Act. These examples, in my judgment, strongly reinforce the basic conclusion that the Lien Consequence is not, in the Agreement, the express and exclusive, sole consequence arising from non-payment on account. Just as the common law debt action ‘overlay’ fits with the contractual provisions, in my judgment clearly the common law entitlement described at paragraph 40 of the Richard Buxton case also applies:

Furthermore, and importantly, it is clear – in my judgment – that the contract does not spell out that terminating the Agreement (“ending this agreement”) is something which can take place, solely and exclusively, if the Applicants have failed to discharge one of the Express Responsibilities. In my judgment – beyond argument –

But even if it were right to characterise the Express Responsibilities as the sole and exclusive grounds on which the agreement could be brought to an end by the Respondent, in my judgment the Applicants then sail into the teeth of the point recognised by Johnson J when refusing permission to appeal. The Express Responsibilities include the duty to “cooperate with us”. Mr Meehan’s submission is that that general provision must “yield to the specific” provisions found elsewhere in the agreement. He submits that the duty to cooperate does not include the duty to make payments on account. In my judgment, and beyond argument, it is clear that the duty of cooperation falls to be interpreted and applied, viewed against the Agreement as a whole. It is, in my judgment, not properly arguable with a realistic prospect of success that the duty to cooperate is narrowed down to exclude matters which have been dealt with expressly. The “core” duty, as the Judge recognised it to be, to make the payments on account, in my judgment, clearly falls squarely within that duty of cooperation. As Johnson J put it: “the refusal to pay, as required by the contract, amounted to a failure to cooperate with the Respondent so as to entitle the Respondent, for this separate reason, to terminate the contract”.

In my judgment, the submissions made based on the Lien Consequence and the Express Responsibilities as express terms of the contract do not, even arguably, undermine the Judge’s conclusion on any of the three bases on which he founded the judgment, nor do they undermine the additional basis (the duty of cooperation) identified by Johnson J. There is no realistic prospect that this court at a substantive appeal would overturn the Judge’s order in relation to the relevant preliminary issue on the basis of these arguments.

I said earlier that there were other points advanced by the Applicants in this case and I will turn to deal with the principal ones now. Before the Judge and in the grounds of appeal the argument was advanced that section 65(2) could not, in any event, be relied on since it applies only to “contentious business” and the Agreement expressly records that it is “not a contentious business agreement within the terms of the 1974 Act”. That point was not advanced in the Applicant’s skeleton argument or orally by Mr Meehan. In my judgment, the Judge was clearly right to reject this objection. Parliament has clearly distinguished between “contentious business agreements” on the one hand and “contentious business” on the other. That is clear from the structure and provisions of Part 3 of the 1974 Act, perhaps most clearly from section 64(1) which refers to “contentious business done by [a solicitor which] is not the subject of a contentious business agreement”. There was nothing in that point and Mr Meehan was right in my judgment not to pursue it.

The next point is that Mr Meehan relied on the judgment of Lavender J in Belsner v Cam Legal Services Ltd [2020] EWHC 2755 (QB). Mr Meehan’s pithy encapsulation of what that case decides was along the lines that ‘solicitors cannot rely on a provision in circumstances of uninformed consent by the client’. As Mr Meehan rightly recognised the application of that approach was specific to the issue arising in that case, which involved the implications of non-disclosure by a solicitor in the context of the fiduciary duty between solicitor and client. Mr Meehan submitted that the principle applies by analogy. As he put it: ‘rights outside the express provisions of an agreement are not rights of which solicitors can take advantage against the client who is uninformed’. In my judgment, the principles discussed already – those applicable to the common law, to repudiatory breach, to construction of the contract, and to section 65(2), as well as to the cooperation duty within the Express Responsibilities – all operate in the context of an agreement between solicitor and client. In the absence of a sustainable arguable point by reference to those matters, Mr Meehan’s ‘Belsner principle’ cannot through the back-door supply for the Applicants what they have failed to achieve through the front-door. If, on the other hand, there is a sustainable arguable point by reference to those matters, Mr Meehan’s ‘Belsner principle’ is not needed and adds nothing. There is also a second fatal objection, in my judgment, namely this. As Mr Meehan fairly and rightly accepts, this argument was not one raised below, nor was it an argument raised in the grounds of appeal. Belsner may be a recent case, but principles relating to fiduciary duty and uninformed consent are in no way new.

Finally, there was a series of points criticising the Judge for not undertaking an analysis in the judgment as to whether, for the purposes of section 65(2), the costs invoiced and the purported termination of the Agreement involved “a reasonable sum” and the giving of “reasonable notice”. The Applicants submit that the Judge’s conclusion on the first preliminary issue is arguably vitiated: by reason of a failure to conduct that analysis; or alternatively an unreasonable conclusion by the Judge (favourable to the Respondent) in relation to these points. In my judgment, there are three distinct bases on which it would not be appropriate to grant permission to appeal on these points. The first is that I have seen nothing to indicate that these points were argued before the Judge, still less as part of the first preliminary issue which is the subject matter of the appellant’s notice. There is no material before me which shows that these points were argued below. Mr Meehan accepts, again very fairly, that he cannot really take that aspect any further forward than what the court has been told in an email from those who instruct him, namely: that there were no ‘agreed facts’ as to reasonableness of the sum and reasonableness of notice; and that there were no ‘concessions’ made. But that falls far short of these points having been argued below. For that first reason alone I would refuse permission to appeal in relation to these issues. Secondly and linked to the first point, I have been shown nothing from the underlying materials in this case which could arguably support the conclusion that the Judge acted unreasonably in the way in which issues were considered or dealt with or reasoned. On an application for permission to appeal it is incumbent on the applicant to demonstrate to the Court that what is said to be a flaw in the approach of the court below is one that arises by reference to the materials. Thirdly, these points – as Mr Meehan, in my judgment rightly, accepted – are points relating to section 65(2). Even if there were anything in them, which I do not accept there is, they would not be a basis for granting permission to appeal in circumstances where the Judge had identified two other distinct bases for the conclusion he arrived at, to which Johnson J has added a fourth (the cooperation duty).

In the circumstances and for all these reasons I am not able to accept that this appeal has a real prospect of success. Nor is there some compelling reason for the appeal to be heard. The application is therefore refused.