Law Weblog

Even more on lawyers fees…

It has been disclosed that Gordon Pollock QC will receive a £3m brief in an action against the Bank of England.  He represents the bank BCCI.  This is thought to be the largest ever fee paid to a lawyer, mind you he is good.
Story from The Times, here

Another example of a conditional fee arrangement and the problems of recovering costs

Arkin v Borchard Lines [2003] Commercial Court
[Conditional fees – access to justice – public policy in conditional fee cases] 
The case was a maritime dispute, where the former shipping company director Arkin brought an £80 million case under a conditional fee agreement. He arranged a complex contingency fee agreement with professional claims funders who paid for experts in return for 25% of any damages.
Mr Arkin claimed loss of profits on the basis that the defendants were in breach of Article 82 of the EC Treaty.

Held: Although Mr Arkin lost the defendants had to pay their own legal costs of £6million.
Defendants who succeed in commercial disputes should not be able to claim back their costs from professional claims funders as it would hinder access to justice.

“The fact that it is the policy of the law to give effect to access to justice permitting an impecunious claimant to sue and so to expose an ultimately successful defendant to shoulder the burden of his own costs…”

First, there was no infringement of Article 81 and Article 82, the ‘irrational’ behaviour of the claimant would have prevented damages being awarded.
Secondly, strong evidence would need to prove predatory price-setting.
Thirdly, lowering the prices only in areas where there was competition was held to be an acceptable response to a new entrant. It was only intended to win back customers.

Claims dismissed
Whole case here

Comment: The court had to decide whether to deter weak claims or accept the widening access to justice. The court decided that access to justice was such an important consideration that it should prevail, which was hard on the defendant who had done nothing wrong.

Example of a conditional fee arrangement

Naomi Campbell the model will take her case for breach of confidence to the House of Lords on 18th and 19th February. She is suing The Daily Mirror, whose costs are expected to be over £1m. The case first started in 2001 and revolved around photographs of Campbell leaving a Narcotics Anonymous meeting after she had already publicly declared that she did not take drugs.
Her appeal which she lost in October 2002 was estimated to have cost her £500,000
Campbell is represented by the firm of solicitors Schillings with whom she is reported to have a conditional fee arrangement for the House of Lords hearing. Schillings will apply for a 100 per cent success fee on its costs if she wins.