When can a non-legally aided party recover costs from the Lord Chancellor?

01/08/25

The statutory scheme for civil legal aid has for many years conferred a power on the Court to award a successful non-legally aided party costs out of public funds. This power, which is now found in reg.10 of the Civil Legal Aid (Costs) Regulations 2013 (“the Costs Regulations”), is subject to several restrictions, and does not apply where the legally aided party does not have statutory cost protection (as is the position in family proceedings). Given the limitations on the Court’s power under reg.10 of the Costs Regulations, the extent to which a successful non-legally aided party may have recourse to the Court’s general jurisdiction under s.51 of the Senior Courts Act 1981 (“SCA 1981”) to obtain a non-party costs order against the Lord Chancellor is a matter of significant interest to litigants.

In Kelly v South Manchester HA [1998] 1 WLR 244, Thomas J (as he then was) held that the predecessor provision to reg.10 of the Costs Regulations in s.18 of the Legal Aid Act 1988 did not affect the Court’s general jurisdiction to make a non-party costs order under s.51 of SCA 1981 against the Legal Aid Board, the body responsible at that time for paying legal aid. The decision in Kelly was cited with approval, in the context of the current legislation, by Keehan J in H v Northamptonshire CC [2018] 1 WLR 5912, where a non-party costs order was made against the Lord Chancellor under s.51 of SCA 1981.

In a judgment handed down today, the President of the Family Division, Sir Andrew McFarlane, has held that the effect of reg.7(1) of the Community Legal Service (Cost Protection) Regulations 2000, as re-enacted in 2013 in reg.9(2) of the Costs Regulations, was to close down the general use of the power in s.51(1) of SCA 1981 to make costs orders against the Lord Chancellor, as had occurred in Kelly. The Court therefore has no jurisdiction under s.51(1) of SCA 1981 to make a non-party costs order against the Lord Chancellor because legal aid has been granted to a litigant. That precludes an application for non-party costs founded upon complaints that the Director of Legal Aid Casework has failed to apply legal aid regulations and guidance in deciding to award, or to continue the grant of legal aid.

In dismissing an application for a non-party costs order against the Lord Chancellor for want of jurisdiction, the President also departed from aspects of the reasoning of Keehan J in H v Northamptonshire CC. The President considered that Keehan J had been wrong to the extent he relied on the decision in Kelly, given the intervening legislative changes and subsequent Court of Appeal authority which it appeared Keehan J had not been referred to. In addition, the President declined to follow Keehan J’s reasoning that the prohibition in reg.9(2) of the Costs Regulations applies only where a legally aided party has statutory cost protection, holding that interpretation would not make sense.

The judgment of the Family Court ([2025] EWFC 241) can be read here.