Can I Recover My Professional Fees?

The case of  Fenchurch Advisory Partners LLP v AA Limited [2023] EWHC 108 (Comm) answers the question can I recover my professional fees? The standard position adopted by the Courts in considering if a contract has been executed and can be enforced is there must be evidence of an intention to create legal relations between the parties: therefore, context is key. 

In this matter, the High Court considered the circumstances in which a professional can recover their fees even if the client has not signed their engagement contract. AA Limited approached Fenchurch to act on its behalf in the sale of its insurance business. The terms of the engagement contract were extensively negotiated via e-mail and Fenchurch had undertaken significant works however no engagement contract was signed. 

The Court found that, despite the said negotiations and work being undertaken, there was no binding contract that could be enforced between the parties. In the e-mail correspondence, the CFO of AA requested confirmation of the final fee details so that an engagement contract could be signed, and Fenchurch confirmed their agreement. This was crucial in the Court finding that the parties had envisaged a signed agreement would be agreed upon moving forward. 

In the alternative to an express agreement, the Court considered if a contract could be implied by the parties actions. Due to the aforementioned e-mail correspondence, it was held that a contract could also not be implied. The importance of Fenchurch for you and your clients is that work should not be undertaken on behalf of a prospective client without an express signed engagement contract, otherwise you run the risk of not being able to recover the costs. Whilst Fenchurch did recover an extent of the costs by way of an unjust enrichment claim, it is never guaranteed. 

The Fenchurch claim is an essential reminder that any work undertaken in advance of an agreed engagement contract is risky and you may not recover the costs incurred. If the work is required to commence early by way of necessity, a short-form contract should be agreed upon to avoid any future issues arising.

If you have concerns regarding a contract entered into or wider issues surrounding a contract dispute, please do not hesitate to contact Andrew Dickinson via email at andrewDickinson@chadlaw.co.uk or call at 0113 225 8811.