A judge has ruled that global law firm Dechert’s £16m legal costs estimate for its work with mining company Eurasian National Resources Corporation (ENRC) was ‘highly unrealistic’.
In an order handed down at the end of last month following a private hearing, Master Jason Rowley at the Senior Courts Costs Office said there was a discrepancy between Dechert’s estimates and the costs actually billed.
ENRC enlisted Dechert to assist with an internal governance review between 2011 and 2013 following allegations of fraud and bribery lodged by the Serious Fraud Office.
Dechert billed ENRC £16.3m for the work, but was accused of ‘systematic and gross overcharging’ over advice it gave. ENRC also claimed Dechert ‘failed to comply with its professional obligations’.
In 2014, the High Court ruled that the dispute should be heard in private despite attempts by Dechert to have it heard in public. Rowley said that would lead to confidential information being put into the public domain ‘in circumstances where third parties were clearly interested in that information’.
Rowley noted that Dechert’s estimates were ‘considerably awry on every occasion’ and were based on ‘highly unrealistic’ assumptions.
An ENRC spokesperson said the judgment ‘vindicates ENRC’s longstanding and deeply held concerns about the level and nature of Dechert’s charges when it acted for ENRC between 2011 and 2013.’
ENRC will now continue its claim for recovery of costs against Dechert in the High Court.
A Dechert spokesperson said: ‘We look forward now to proceeding with the costs assessment process.’
ENRC was represented by Ben Williams QC, of 4 New Square Chambers and Saaman Pourghadiri of Outer Temple Chambers, instructed by Signature Litigation.
Dechert was represented by Simon Browne QC of Temple Garden Chambers and Mersedeh Safa of Clyde & Co.