A DEFENDANT WAS BOUND BY THE TERMS OF AN ORDER AGREED BY THEIR COUNSEL: THE DEAL WAS DONE

In Ashford Borough Council & Anor v Wilson [2022] EWHC 988 (QB) Darryl Allen QC, sitting as a High Court judge, found that a defendant was bound by the terms of an order drawn up with the agreement of their directly instructed counsel. The fact that counsel had left private practice and was now an in-house advocate did not equate to a termination of instructions.

THE CASE

Following a trial, in which the claimants were successful, the barristers involved for each party agreed an order, including the payment of costs.  The defendant argued that he was not bound by the terms of that order.  His barrister had been instructed directly and had, in the course of the action, left private practice and become an in-house advocate.

THE JUDGMENT ON THIS ISSUE

The judge found that there had been an agreement which bound the defendant.

(1) Had a costs order been agreed?

16.Plainly the answer to that question is yes. Mr Davies and Mr Deakin had agreed a proposed order for costs on 15th September 2021. The agreed order was emailed to me to be sealed and issued. It is clear from Mr Deakin’s emails that the order had been agreed by him. The real issue is whether the Defendant is bound by that agreement.

(2) Are the parties, in particular the Defendant, bound by the terms of the agreed order?

17.The Defendant has provided written submissions. They do not address this issue. The Defendant has not provided any evidence that Mr Deakin was no longer instructed by him as at 15th September 2021. He has provided no evidence that he terminated Mr Deakin’s Direct Access instructions/retainer prior to 15th September 2021.
18.The high point of the Defendant’s position is set out in his letter to Mr Mortimer dated 20th September 2021, quoted above. In essence, the Defendant considers that Mr Deakin was no longer “his barrister” after he left his Chambers at the end of April 2021.
19.The Defendant equates Mr Deakin leaving his Chambers to take up a position as an employed barrister to terminating the Direct Access instructions. That does not follow. There is no evidence that the Direct Access agreement provided that the instructions would be terminated in the event that Mr Deakin left his Chambers. There is no evidence that the Defendant terminated Mr Deakin’s instructions. There is certainly no evidence that Mr Deakin considered his instructions to have been terminated. Indeed, his participation in agreeing a list of typographical corrections and the draft orders demonstrates that he considered himself still instructed to represent the Defendant.
20.A brief to represent a client at a hearing includes receiving the judgment and drafting/agreeing any orders that flow from it. Mr Deakin’s instructions/retainer extended to considering the judgment and agreeing the orders that flowed from it in this case. I have no doubt that the Defendant would have been the first to complain had Mr Deakin ignored the Court’s requests for an agreed list of corrections and agreed orders.
21.Importantly, there is no suggestion or evidence that the Defendant notified the Claimants that Mr Deakin was no longer instructed, prior to sending his letter of 20th September 2021. As far as the Claimants were concerned, Mr Deakin was still instructed to represent the Defendant: all of his actions dealing with the judgment and the list of corrections, and discussing the draft orders were entirely consistent with that being the case; his email correspondence with me was also entirely consistent with that. There was no reason whatsoever for the Claimants or their counsel to suspect or question whether Mr Deakin was authorised to act on behalf of the Defendant.
22.There is no evidence that the Defendant instructed Mr Deakin not to enter into discussions or any agreement regarding the costs issues or that his authority to reach agreement on the costs issues was limited in any way.
23.The Claimants submit:
i)it is well established that counsel has a broad general authority to bind a client;
ii)that counsel is presumed to have authority without limitation (within the scope of the litigation);
iii)counsel may do anything which he considers is in the best interests of his client, even if he lacks specific instructions, so long as it is directly related to the dispute before the Court;
iv)if counsel enters into an agreement under the auspices of his apparent authority then his client is bound by that agreement.
24.They acknowledge that that analysis is subject to qualification. First, they accept that counsel’s apparent authority does not extend to collateral matters not concerned with the main action. Second, they accept that counsel cannot bind his client where he has been expressly instructed not to enter into an agreement in relation to a particular issue as his actions would be ultra vires.
25.In my judgment, the exceptions to the general rule are a little wider than the Claimants suggest.
26.In Shepherd v. Robinson [1919] 1 K.B. 474, counsel for the defendant, believing he had full authority to do so, consented to what he considered was a favourable settlement for his client. In fact, unbeknown to counsel, the defendant had given instructions to her solicitor that the claim was to be contested. The solicitor was awaiting the defendant’s instructions on the proposed compromise. Before the defendant’s instructions to reject the compromise were received, counsel for the defendant had consented to the judgment. Before judgment was drawn up and entered, the defendant applied to have the action restored. In that case, counsel had not been expressly instructed not to enter into an agreement: he was completely unaware of any restriction on his authority to do so.
27.The Court of Appeal in Shepherd upheld the Judge’s decision to restore the action. Banks LJ referred to two relevant lines of authority [477-478],

“It is clear that counsel has an apparent authority to compromise in all matters connected with the action and not merely collateral to it; and if he acts within his apparent authority and the other party has no notice of any limitation or restriction on that authority, the client will be bound by the agreement made by his counsel and embodied in some order or judgment of the Court. If Mr. Powell could bring this case within that line of decisions I should agree that this compromise must stand.

But there is a second and different line of cases which decide that before a consent order has been drawn up and perfected the consent given by counsel or solicitor may be withdrawn by the client if the counsel or solicitor gave it under a misapprehension. In such cases the Court will not proceed further with the drawing up and perfecting of the order, and will not lend its authority to compel observance of an agreement arrived at through a mistake. This is the line represented by Holt v. Jesse and by Neale v. Gordon-Lennox, where Lord Hals-bury L.C. said: ‘The Court is asked for its assistance when this order is asked to be made and enforced that the trial of the cause should not go on ; and to suggest to me that a Court of justice is so far bound by the unauthorized act of learned counsel that it is deprived of its general authority over justice between the parties is, to my mind, the most extraordinary proposition that I ever heard.’ ”

28.Banks LJ held [478-479],

“The only question here is whether the order never having been drawn up, the facts bring the case within the class of authorities of which Holt v. Jesse is an example. In my opinion they do. Counsel acted under a misapprehension. It is immaterial whether the mistake was as to some particular matter forming part of the basis of the settlement or whether it was as to his authority to make a settlement. No order has been drawn up. The Court has been asked to give effect to a compromise consented to under a misapprehension and not yet effective. The order of Darling J. was right, and this appeal fails.”

29.Warrington LJ held [480],

“In the present case if the Court had known the facts, that the authority of counsel was limited and that counsel thought it was unlimited, the consent order would never have been made; and so the Court, having been asked, before that order has taken its final form, to restore the case to the list, is bound to grant the application. This appeal must therefore be dismissed.”

30.Duke LJ held [481],

“It is clear that counsel would never have consented to the compromise if he had known that his client had given instructions that there should be no settlement without her consent. Fortunately, the consent judgment was not drawn up and entered before that mistake was discovered. Then it follows beyond all doubt or question that the Court stays the drawing up of the order. Otherwise the Court would allow itself to be made an instrument of injustice in giving form and effect to a compromise which the parties concerned have never agreed to.”

31.With reference to Shepherd v. Robinson, the authors of Chitty on Contracts state [§31-013],

“… if the consent was given under a misapprehension then it may be withdrawn before a consent order is drawn up.”

32.In that case there was clear evidence that the defendant, Ms Robinson, had given clear instructions that the case was not to be compromised. The misapprehension of her counsel was his belief that he had authority to compromise the case.
33.In the instant case there is no evidence at all that the Defendant had issued instructions that Mr Deakin was not authorised to agree the draft orders or that there was any restriction at all upon what could be agreed. There is no evidence that his instructions or retainer had been terminated. As already set out above, at no stage did the Defendant notify the Claimants or the Court that Mr Deakin was no longer acting for him.
34.In my judgment the Mr Davies and Mr Deakin agreed the costs order which was entirely consistent with and within the ambit of their apparent authority. The parties are bound by that agreement. This is not a case in which the Court should exercise its discretion to permit the Defendant to withdraw from that agreement.