Mohinder Singh & Ors v David Ingram (in his capacity as the Liquidator of MSD Cash and Carry PLC)

This appeal was not about who won the underlying insolvency case. That had already been decided, and the defendants had already been ordered to pay the liquidator's costs on the indemnity basis. The remaining fight was about the scope of the liquidator's funding arrangement with his solicitors and what costs consequences followed from it.

The liquidator had instructed Boyes Turner on the claim from March 2012, but the written Conditional Fee Agreement was signed later, on 24 March 2015. The defendants argued that the CFA should be treated as prospective only, meaning it applied only from the signing date onwards. If that argument worked, it could reduce the costs consequences for them. The liquidator said the CFA covered the whole claim, including work already done.

The court focused on the wording of the CFA itself. Key provisions referred to the solicitors' work on the claim and defined the claim as the liquidator's application against the defendants, in respect of which the firm had been engaged since 30 March 2012. The agreement also defined basic charges by reference to work done by the firm in relation to that claim.

The defendants said this was not enough. They argued that retrospectivity had to be express, clear and unambiguous, and that the definition of the claim could be read as merely describing the proceedings rather than fixing the period of chargeable work. They also criticised the idea of reading clauses together with the defined terms to produce a retrospective effect.

The legal issue was whether, on ordinary principles of contract interpretation, this CFA had retrospective effect. The court considered whether the wording showed that the agreement covered work already done before 24 March 2015, as well as work done afterwards. It also had to deal with arguments that there was a presumption against retrospectivity, that any retrospective effect had to be stated expressly, and that the factual background displaced the apparent meaning of the words.

A linked issue was whether an alleged failure by the solicitors to explain the retrospective effect to their client could change the meaning of the contract. The court treated that as a separate question from interpretation.

The Court of Appeal dismissed the appeal. It held that the CFA was plainly retrospective on its proper construction. The agreement was concerned with the solicitors' work on the claim, and the claim was defined as one in respect of which the firm had been engaged since 30 March 2012. The court said no division was made between past and future work, and no temporal distinction was drawn. Read fairly, the CFA covered all work done and to be done on that claim.

The court also rejected the argument that a CFA must use special wording or the word retrospective. It said there is no special drafting formula. The ordinary principles of interpretation apply. It was legitimate to read the operative clauses together with the defined terms, and doing so made the position clear.

The defendants tried to rely on the surrounding facts. They pointed to an earlier written retainer and an oral understanding that, if assets were not realised, the solicitors would waive or reduce charges. They argued there was no commercial need for a retrospective CFA because the parties thought they already had an arrangement in place.

The court was not persuaded. It accepted that the earlier arrangements formed part of the background, but said they did not alter the meaning of the written CFA. The lower courts had found that the liquidator understood the CFA to be retrospective and that this matched the parties' previous way of working in insolvency cases where recovery of assets funded both the proceedings and legal fees. The Court of Appeal also stressed that factual matrix evidence has limits.

It cannot be used to override the express meaning of the contract.

One of the defendants' arguments was that the solicitors had not explained to the client that the CFA was retrospective and that this was a breach of professional duties. The court treated that as a different issue from what the contract meant. Even if there had been a regulatory problem, that would not change the proper interpretation of the CFA in this appeal.

The court relied on the distinction between a solicitor-client contract and separate professional conduct obligations. It said that an alleged regulatory breach might have consequences in another context, but it did not let the paying party rewrite the contract's meaning after the event. The court also noted procedural problems with this argument because the point had not been properly pleaded or found as a fact below.

This case is most useful for businesses involved in litigation funding, insolvency claims and costs disputes. If your business signs a new fee arrangement after a dispute has already started, the document may reach back and cover earlier work if that is what the wording does. That matters whether you are the client, the officeholder, a director defending a claim, or the party who may later have to pay the other side's costs.

It also shows why definitions matter. Commercial contracts often hide the key point in a defined term rather than in a dramatic headline clause. A business owner reading only the payment clause might miss that the definition of the claim or services already fixes the start date and scope of the work covered.

If your business is entering, revising or inheriting a litigation funding arrangement, use a practical review process. The aim is to avoid later arguments about whether the agreement applies only going forward or also captures earlier work. This is especially important in insolvency and fraud-related disputes, where funding structures may evolve as recoveries become clearer.

For directors and SMEs, the same checklist helps when reviewing the other side's claimed costs. You are not just checking the hourly rates or total figure. You are also checking whether the underlying agreement actually supports the period of work being claimed.