100% success fees hailed

CFAs: judges recognise the reality of commercial pressures on solicitors' firms

Claimant solicitors in two high-profile cases this week hailed decisions to grant them 100% success fees, seen as recognition of the commercial pressures they are under.

In the first case, Sarwar v Alam, Master Rogers made the preliminary ruling after Manchester firm Amelans submitted a bill for 255,745 in a case that settled for 2,250.

Sarwar concerned a minor road accident but ended up in the Court of Appeal as a test case on whether legal expenses insurance should be used to fund claims even if the client was not aware of the cover.

Master Rogers ruled that 'the solicitors were assuming a substantial risk in entering into a conditional fee agreement (CFA) and that, therefore, the claimed success fee of 100% was justified'.

He also disagreed with the defendant's insurer, Co-operative Insurance Services (CIS), that Amelans' 62,500 payment on behalf of the client for the insurance premium was improper, adding that it was not unreasonable to pay a premium of half the total liability in risky cases.

Master Rogers cut the hourly rate of 350 claimed by Amelans down to 215, but acknowledged the specialist nature of the firm.

He said: 'I take judicial notice of the fact Amelans are rapidly acquiring a reputation for dealing with this sort of case.'

However, in an earlier hearing, he ruled that the costs appeared to be disproportionate and should be subject to the 'necessary test'.

Amelans partner Martin Cockx said: 'One of the main things the judge seems to have accepted is the commercial reality of personal injury litigation at the moment,' he said.

'The judge recognised that this is the way things must be done in order to allow the client to litigate risk free.'

But CIS solicitor Charles Attwell insisted that the issue was not cut and dry.

'There have been other preliminary findings in the costs assessment process to include a reduction by more than a third in the hourly charging rate initially sought and a ruling in favour of the defendant on the issue of proportionality,' he said.

The second case - Designers Guild v Russell Williams - was a copyright case that led to the House of Lords introducing a means of dealing with CFAs and uplifts in costs.

Following assessment, Blackburn firm Taylors successfully claimed a 100% success fee.

Senior partner Tony Catterall welcomed the clarity.

'It has been a ground-breaking case from start to finish and we are delighted with the outcome,' he said.

Paula Rohan