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Learning outcomes
What you will learn
- 01
Distinguish what a client owes their solicitor from what may be recovered from an opposing party.
- 02
Explain the modern general rule on CFA success fees and after-the-event insurance premiums.
- 03
Recognise irrelevant or distracting facts in an SQE-style scenario.
- 04
Use altered facts to test when the legal answer might change.
Reverse Engineering
Take the question apart before answering it.
A successful claimant has a written conditional fee agreement with a 50% success fee. The solicitors charge £40,000 base costs plus a £20,000 success fee. The claimant also purchased after-the-event insurance with a £10,000 premium. Which of those categories can ordinarily be recovered from the defendant under the modern post-April 2013 regime?
The question is testing the difference between solicitor-and-client liability and inter-party recoverability — not whether the CFA is valid, whether 50% sounds high, or whether the figures add up neatly.
The base costs are the only one of the three categories that may ordinarily be recovered from the defendant, subject to the court's costs discretion, assessment and any applicable fixed-cost regime.
Tiger traps
- The fact that the CFA is written and states a 50% success fee may distract you into validity questions that the scenario is not asking.
- The figures invite arithmetic, but the legal task is classification rather than calculation.
- Winning the case does not mean every sum charged by the solicitor is recoverable from the opponent.
- Do not assume that an ATE premium is always irrecoverable: limited statutory exceptions exist, including a defined clinical-negligence exception for the relevant part of a premium covering specified expert-report risk.
Distractor anatomy
- Success fee + premium: confuses what the client may owe with what the losing party can be ordered to pay.
- Base costs + success fee + premium: resembles the broad old recoverability regime rather than the ordinary modern position.
- Base costs + success fee: wrongly transfers the success fee to the opponent.
- Base costs + premium: treats ATE premium as an ordinary recoverable disbursement despite the modern statutory bar and limited exceptions.
If the scenario expressly activated a saved pre-commencement funding regime, or a statutory exception concerning an ATE premium, the analysis could change. One modern exception concerns the relevant part of an ATE premium relating to specified expert reports in clinical-negligence proceedings. Do not import an exception unless the facts justify it.
Lightbulb Law Briefing Note
The episode, distilled.
The modern rule
For ordinary modern civil litigation, a costs order cannot generally require the opposing party to pay a CFA success fee. ATE insurance premiums are also generally not recoverable by way of a costs order, subject to limited statutory exceptions. Ordinary base costs remain potentially recoverable, but the amount is controlled by the costs rules and may be fixed or assessed.
Why 'recoverable' does not mean 'recoverable in full'
CPR 44.2 gives the court discretion over whether costs are payable, their amount and timing. Where costs are assessed on the standard basis, CPR 44.3 applies reasonableness and proportionality. Part 45 may instead impose fixed recoverable costs in claims within its scope.
The exam method
Classify each sum first. Then identify the funding date and regime. Check for an expressly triggered exception. Finally, separate the client's contractual liability to the solicitor from the amount that may be shifted to the opponent.
The framework
Key points
Client liability and inter-party recoverability are different questions.
Modern CFA success fees are generally borne by the funded party rather than shifted to the losing opponent.
ATE premiums are generally irrecoverable from the opponent, subject to limited exceptions.
Base costs may be recoverable, but can be fixed, assessed, reduced or disallowed.
Do not activate transitional or exceptional regimes unless the facts justify doing so.
Legislation & rules
Key statutory material
Flip the cards
Retrieve, do not just reread.
Try to answer each prompt before revealing the back of the card.
Quick Check
Test the connection.
Question 1
What is the best answer to the original scenario under the ordinary modern regime?
Question 2
Why is the 50% success fee potentially distracting?
Question 3
The claimant wins and receives a costs order. What should you conclude about the £40,000 base costs?
Your Lightbulb Law Moment
Notice what has just clicked.
The question becomes much easier once you stop treating 'costs' as one pot of money. Classify each sum and ask a separate question about each one: who owes it, and can it lawfully be shifted to the other side?
Pause before moving on.
What additional fact would you need before confidently applying a transitional pre-April 2013 regime or a statutory ATE-premium exception?
Downloadable support
Useful on paper, not designed as a content dump.
Selected printable companions use the restrained Lightbulb Law house style, with Times New Roman, black-and-white layouts and generous space for annotation.
Accuracy note
Current-law companion reviewed against LASPO 2012 ss.44 and 46, Courts and Legal Services Act 1990 ss.58A and 58C, the Recovery of Costs Insurance Premiums in Clinical Negligence Proceedings Regulations 2013, and CPR Parts 44, 45 and 48 on 17 September 2026.