Lawyers who represented a client in a failed malicious prosecution claim will not have to foot the winners’ seven-figure bill, the High Court has ruled.
Lady Justice Rose, sitting in the Chancery Division in Willers v Joyce, dismissed the application for a non-party costs order against the London firm De Cruz Solicitors, Hugo Page QC and junior Adam Chichester-Clark, who had all previously represented the claimant.
The judge had dismissed Willers’ claim for malicious prosecution and abuse of process last December – the latest chapter in long-running litigation. Willers had brought proceedings alleging that executors of the estate of the late businessman Albert Gubay had maliciously prosecuted an action against him. That action, the Langstone Action, was discontinued in 2013.
When Willers’ malicious prosecution claim was lost, the executors sought to add his lawyers as defendants for the purposes of costs.
The court heard the executors’ total costs of defending the malicious prosecution claim are around £1.9m, and without an order against his lawyers they were likely to recover almost nothing from Willers himself.
The executors submitted that the 'direct, personal financial interest' that the lawyers had in the claim meant that, the claim having failed, the lawyers should be liable to pay their costs.
Under the CFA agreed between Willers and his lawyers for the Langstone Action, it was agreed he would be liable to pay the difference if the court did not cover all the legal charges and disbursements. In the event, De Cruz claimed a total of £3.46m but costs were assessed at £1.45m.
The executors submitted to the court that Willers’ lawyers were effectively now ‘extending credit’ to him and would be repaid only if he came into money. It was said the lawyers therefore had a ‘personal stake’ in the malicious prosecution claim.
Rose LJ conceded hers was a ‘difficult decision’ to make. She acknowledged a strong public interest in ensuring claimants have access to justice ‘even if that means that successful defendants are left substantially out of pocket’.
She vowed not to ‘fall into the trap’ of assuming that the lawyers were encouraging Willers to bring and pursue the malicious prosecution claim. He was, it was ruled, entitled to instruct the same lawyers as they best understood the case.
The judge said that the applicants had not proved the lawyers would have refused to allow Willers to abandon his claim if a modest payment had been offered. ‘The interest that the [lawyers] had in the success of the malicious prosecution claim was not so different from the direct financial interests that lawyers commonly have in litigation as to make them a real party in substantial and critical respects,’ added the judge.