Champertous arrangements

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A firm of solicitors offers to indemnify its client against an adverse costs order as part of its CFA.

In Dix v Townend [2008] EWHC 90117 (Costs) Deputy Master Williams held such an agreement to be contrary to public policy and to invalidate any retainer.

MacDuff J in Morris v London Borough of Southwark [2010] EWHC B1 (QB) held that such an agreement might be unlawful but the particular one he was considering was lawful.

The matter is now headed off to the Court of Appeal.  Until the Court gives a definitive ruling, solicitors would be foolish to continue to offer such indemnities.  

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