Court of Appeal holds that QOCS does not apply where there is a CFA in place pre-1st April 2013, even if it is terminated

On 1st April 2013, ATE insurance premiums and CFA success fees ceased to be recoverable from the losing defendant and personal injury claimants were instead protected by the QOCS regime, whereby they do not have to pay the costs of the successful defendant. Of issue in this case was whether the personal injury claimant who discontinued her claim in 2015 was entitled to the benefit of the QOCS regime. She had entered into a CFA with her solicitors in 2012, but this was replaced by a new CFA which she entered into with the same solicitors in July 2013.

The relevant transitional provision (CPR r44.17) provides that QOCS does not apply where the claimant has entered into a "pre-commencement funding arrangement". There was no dispute here that the first CFA entered into by the claimant here was such an arrangement. The claimant sought to argue that as that arrangement had been terminated and been replaced by the second CFA, the claimant had become entitled to the benefit of QOCS. That argument was rejected at first instance and the Court of Appeal has now rejected the appeal from that decision.

It was held that there was no requirement that the relevant funding arrangement should be "unterminated" in order to remain a "pre-commencement funding arrangement": "The right construction of the rule, therefore, is to give the words "funding arrangement" their natural meaning and apply them to any pre-1st April 2013 agreement (whether terminated or not)".