Introduction

The case of Manolete Partners PLC v White ([2024] WLR(D) 547) adjudicated by the England and Wales Court of Appeal (Civil Division) on December 12, 2024, marks a significant development in the application of pro bono costs orders under section 194 of the Legal Services Act 2007. The dispute centers around whether courts should consider the existing substantial judgment debt owed by a successful party who was represented pro bono when ordering costs under section 194.

The parties involved are Manolete Partners PLC, a large commercial entity, and Mr. Ian White, an individual who obtained pro bono legal representation in his appeal against Manolete’s attempt to enforce a judgment debt exceeding £1 million.

Summary of the Judgment

Lord Justice Snowden delivered the primary judgment, which was unanimously supported by Lord Justice Green and Lady Justice Asplin. The court focused on the propriety of making a costs order under section 194 of the Legal Services Act 2007, considering the high judgment debt owed by Mr. White to Manolete.

The Court of Appeal overturned a previous order by HHJ Hodge KC, which had required Mr. White to utilize his occupational pension to satisfy the debt. Instead, the Court held that such an order was prohibited under section 91(2) of the Pensions Act 1995. Further, the Court addressed the application for a pro bono costs order, determining the appropriate amount Manolete should pay to the Access to Justice Foundation (AJF) under section 194(3).

Ultimately, the Court ordered Manolete to pay £85,000 to the AJF, rejecting Manolete’s attempt to condition this payment on the recovery of the judgment debt from Mr. White.

Analysis

Precedents Cited

In rendering its decision, the Court referenced previous case law to contextualize the application of section 194. Notably:

• R (Burkett) v Hammersmith LBC [2004] EWCA Civ 1342: This case was pivotal in discussing the discretionary nature of costs orders under section 51 of the Senior Courts Act 1981, emphasizing fair and just outcomes in cost allocations.
• Section 194 of the Legal Services Act 2007: Although not a case, the Court’s interpretation of legislative provisions underlines the importance of understanding statutory intent, especially concerning pro bono representation.

These precedents influenced the Court’s approach by highlighting the balance between equitable cost distribution and the legislative objectives aimed at supporting pro bono legal services.

Legal Reasoning

Lord Justice Snowden’s legal reasoning focused on interpreting section 194’s provisions within their legislative context. Key points include:

• Discretionary Power of Section 194(3): The Court affirmed that ordering a payment under section 194 is discretionary. While section 194(4) mandates the court to "have regard to" potential set-offs owing to existing judgment debts, it does not compel the court to mirror such set-offs in the pro bono order.
• Legislative Purpose of Section 194: The Court emphasized that section 194 aims to level the playing field in litigation by mitigating the advantage of private funding over pro bono representation and to support charitable organizations like the AJF.
• Rejection of Conditional Orders: The Court found Manolete’s proposal for a conditional payment order unfeasible and contrary to the statutory purpose, as it would undermine the financial support intended for pro bono services.
• Assessment of Reasonable Costs: Without an exhaustive assessment, the Court deemed the proposed £85,000 as a fair approximation of notional costs, balancing accuracy with practicality.

Impact

The judgment in Manolete Partners PLC v White has several implications for future cases and the broader legal landscape:

• Clarification of Section 194: This case provides authoritative guidance on how courts should interpret and apply section 194, particularly regarding the interaction between pro bono costs orders and existing judgment debts.
• Strengthening Pro Bono Framework: By rejecting conditional payment orders, the judgment reinforces the intent to financially support pro bono services, ensuring that charities like the AJF receive unencumbered funding.
• Cost Management in Litigation: The decision underscores the importance of fair cost assessment in cases involving pro bono representation, potentially influencing how costs are negotiated and ordered in similar disputes.
• Precedent for Large Judgments: The approach taken by the Court in dealing with substantial judgment debts may serve as a benchmark for handling similar circumstances in future litigation.

Complex Concepts Simplified

Conclusion

The Manolete Partners PLC v White judgment serves as a landmark decision in the realm of pro bono legal services and costs orders under the Legal Services Act 2007. By affirming the discretionary nature of section 194(3) and rejecting the imposition of conditional payment orders, the Court of Appeal reinforced the legislative intent to support and sustain pro bono legal assistance. This decision not only clarifies the application of existing laws but also ensures that the financial burdens associated with litigation do not disadvantage those relying on pro bono representation. Moving forward, this precedent will guide courts in balancing cost allocations fairly, thereby promoting equitable access to justice.