Criminal lawBy Anthony Edwards, TV Edwards, LondonCosts from central fundsR v Liverpool City Justices, ex parte McCormack and Larkin (2001) The Times, 12 January The grant of a representation order in the criminal courts is no longer a means tested benefit and depends only on the merits of the case.

This will substantially reduce the number of occasions on which solicitors are privately instructed and thus the number of orders for the payment of defence costs from central funds.

However, in road traffic and regulatory offences the recovery of such costs will remain significant.In R v Liverpool City Justices, ex parte McCormack and Larkin the Divisional Court confirmed that a court may only call for a receipt in support of a bill, payable from central funds, when monies have actually been paid to the solicitors.If no monies have been paid, there is no requirement to send a receipt.

However, in guidance issued by the Lord Chancellors Department, it has been emphasised that this does not undermine the fundamental principle on which central funds bills are payable, namely that they are a reimbursement to the client for the clients liability only.The principal rule is that a payment from central funds is a payment to the client for the monies the client is liable to pay to a solicitor.The solicitor cannot normally recover the money direct, although many courts will allow the client to authorise them to make the cheque payable to the solicitors.

It is good practice to have such an authority on file.As a result of the principal rule solicitors should have a clear statement of the clients liability to them in their client care letter.

This may either be done by confirming the agreed amount for which the client is liable, or by way of a best estimate (which must always be kept up to date), or by way of an hourly rate.

If a figure is agreed with a client no greater sum may be recovered from central funds.Where such a letter has been sent it would be the normal presumption that the client is liable to meet the solicitors costs.

See in comparable circumstances: Hazlett v Sefton MBC [2000] 4 All ER 887.The reality of indemnities where clients of limited means have instructed solicitors was examined in Leeds City Council v Carr and Coles v Barnley MBC [2000]1 Costs LR 144.

In the first there was a signed liability for costs by a person on income support which would be settled at 2 to 3 per week.

Regular costs information was provided by the solicitors.

This was found not to be a sham but to be an agreement which could be enforced.In the latter there was similarly found to be no sham but the existence of a liability which could be reimbursed, even though the solicitors had never sought to recover any money under the agreement.In determining a bill payable from central funds a determining officer is not bound by any specific agreement between the defendants and their solicitors but the fact that the defendant did not seek legal aid is not a relevant consideration.

(Morris v Lord Chancellor [2000] 1 Costs Law Reports 88).