Is a damages-based agreement enforceable where it has been made between a costs management company and a child’s litigation friend which would have been enforceable if the litigation friend had made it with a lawyer? If so, is it a proper exercise of the court’s discretion on an approval hearing to order that the amount due to the company be paid out of the child’s damages?
There may be a liability to pay a percentage of damages for claims management services (within the meaning of s 4(2)(b) of the Compensation Act 2006) on the part of the person who has instructed the claims management company. However, that would not be a liability of the child and the court might well refuse to approve any part of the child’s damages being used to satisfy the litigation friend’s liability of this kind. In any event, the damages-based agreement could be unenforceable: it is not unknown for an agreement to provide for a 25% share of personal injury damages without credit being given for the costs to be collected from the paying party and this in unlawful. Where
