We continue to encounter issues in this area. Client files are not assets of a firm, only the WIP is, and the files are therefore not the firm’s to sell. It is up to the client where the file goes. The Court of Appeal’s 2017 decision in Budana made it clear that it is safer to transfer files by novation (requiring the client’s agreement) than by assignment. Where there is a CFA to be transferred, unwitting termination may make costs irrecoverable, and a payment on the transfer of Personal Injury files must be framed so as to avoid a referral fee that offends LASPO.
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