Having entered into a funding arrangement, the duty falls on the legal adviser to notify it to the court and those likely to be affected by it.

The thrust of the provisions is to allow all other parties to appreciate that they are litigating against a party with a funding arrangement and to know the nature, but not the details.Principally this is achieved, prior to the commencement of litigation by the party who has made an arrangement giving notice to all other parties, at the time of issue by the claimant giving notice, or by the defendant giving notice upon the filing of his first document at court, be it the acknowledgement of service or defence (costs practice direction (PD) para 19.2).

The information required is set out at PD para 19.4.

This duty is ongoing and there is a requirement that when information has been given and is no longer accurate the party must file a notice of change on the other parties within seven days (CPR rule 44.15 and PD para19.4).

Failure to provide the information or to update it in accordance with the rules, practice direction or order of the court may lead to a failure to recover the additional liability unless the court grants relief (rule 44.3B and PD para 10.1).Solicitors who were familiar with the civil legal aid scheme knew the importance of serving notices of amendment of a legal aid certificate, so that their opponents knew of the funding position.

In the same way, those that litigate against an opponent with a funding arrangement must know as much as the new regime permits of their potential liability.Experience suggests that some solicitors were not always assiduous in serving notices of amending certificates.

Now they must keep the funding situation under review and discharge an onerous duty of information.Solicitors are well aware of the requirements to give costs estimates at stages, such as on filing the allocation (except for small claims) or listing questionnaires.

As part of the general duty to keep parties informed of their potential liability, these costs estimates will now have to comply with PD para 6, which stipulates the information that has to be included in the form.

Note that there is no requirement to state the amount of the additional liability as a separate item nor to give information as to how it is calculated until the additional liability falls to be assessed (PD para 19.1).Interim costsIt is important to the scheme of costs that the precise nature of the arrangement between the client and his legal adviser remains confidential until the outcome (and the success or otherwise) of the litigation is known.

This creates a potential problem for the summary assessment of costs on interim hearings.

Open disclosure of the funding arrangement and the reason fo r any uplift in the success fee are a critical part of a detailed assessment.

However, they cannot be disclosed at an interim stage without having the potential for fatally damaging the client's case.

It follows that the summary assessment of costs at interim hearings will be taken to be an assessment of the base costs with the assessment of the additional liability adjourned for a detailed assessment (CPR rule 44.3A and PD para 14.2).Even the summary assessment of costs at the conclusion of the hearing may be delayed until after the outcome of any appeal is known.

The PD sets out in detail the information to be given to the court, the bundles to be prepared for the costs officer and the form of the order that the court will make.Assessment of costsAt the successful conclusion of the litigation the solicitor will be looking forward to receiving the basic fee and the success fee.

The solicitor's labour and astute assessment of the case are about to bear fruit.

But all may not be plain sailing.

In relation to a detailed assessment, there is then an obligation on the receiving party to provide full information of the funding arrangement and, in relation to a conditional fee agreement (CFA), the rationale for any percentage uplift.

The court can order that the CFA be produced to it.

The importance of getting this information right has already been stressed.It will be recalled that regulation 3(2)(b) of the Conditional Fee Agreement Regulations 2000 provides that, where a court decides that a percentage uplift is not allowed between parties, then it is unenforceable as against the client unless the court orders otherwise.

Provision is made in the rules for the court to adjourn to entertain an application for the additional liability to be recoverable from the client in these circumstances where the costs have been summarily assessed (see PD44 paras14.20 et seq and 20.1 onwards).Where the costs are the subject of detailed assessment, provision is made in the PD for counsel and the client to be informed of any challenge, the basis of the challenge and the quantum sought by the paying party.

Practitioners on both sides of the profession must be live to the tight time limits (three days for a solicitor to advise counsel of the points of dispute, seven days for counsel to respond and five days for the solicitor to advise the client and give detailed information of any application under regulation 3(2)(b) of the Conditional Fee Agreement Regulations 2000.One might expect that the requirements of proportionality would be amended to allow for the recovery of the additional liability.

This has not proved to be the case and the rules make it clear that the requirements of proportionality are a live issue.

PD para 11.5 states: 'In deciding whether costs are reasonable and (on a standard basis) proportionate, the court will consider the amount of any additional liability separately from the base costs.' Section 11 goes on to set out the precise matters that the court will consider in deciding the reasonableness of any additional liability.

Further, the factors will be considered as they reasonably appeared to the legal representatives at the time of the agreement rather than with the benefit of hindsight and the successful outcome.

It follows that the receiving party is likely to have to produce material that will allow the judge to see the action through their eyes at the time of the agreement.Transitional arrangementsAnd finally on to the transitional arrangements.

For those who have been brave (or foolhardy enough) to enter into CFA s on or after1 April 2000 and have issued proceedings, the amended transitional arrangements provided that practitioners had 28 days from 3 July 2000 to bring their CFAs into compliance with the new arrangements.

If you have not complied by now, then it is too late.

Back to the drawing board.As with all matters legal, the devil is in the detail and those who propose to enter the new world of funded litigation cannot safely avoid reading the fine print of the relevant rules, regulations and the PD.