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Supreme Court finds conditional fee agreements in line with human rights treaty

In a decision providing certainty to recovering litigation costs, the Supreme Court has ruled that the costs regime put in place by the Access to Justice Act 1999 (AJA) complies with European Convention on Human Rights.

The court, in the ongoing Coventry & Ors v Lawrence & Anor and by a majority of five to two, held that the recovery of costs under AJA, in this instance from a conditional fee agreement (CFA) success fee and after-the-event insurance (ATE), was compatible with the convention.

The respondents, operators of a motorsports stadium, were challenging their liability for CFA success fees and ATE premium in the case that revolved around claim of nuisance from the appellants, owners of a bungalow. The operators stated that paying such costs infringed their rights under article 6 of the convention, which protects the right to a fair trial, and article 1 of the convention’s first protocol, which protects the right to peaceful enjoyment of ones possessions.

Lord Neuberger and Lord Dyson handed down the judgment arguing: ‘the financial position of the paying party had never been a relevant factor in determining the assessment of reasonable and proportionate costs. The scheme as a whole was a rational and coherent scheme for providing access to justice’.

The case roped in a slew of law firms with the bungalow owners represented by Richard Buxton Environmental and Public Law instructing Stephen Hockman QC, Timothy Dutton QC, William Upton and Benjamin Williams while the respondents saw Pooley Bendall Watson instruct Robert McCracken QC and Sebastian Kokelaar.

There were also a substantial number of interveners with the government legal department instructing Tom Weisselberg QC and Jason Pobjoy for the Secretary of State for Justice and Leigh Day partner Harminder Bains instructing Robert Weir QC, Harry Steinberg and Achas Burin for the Asbestos Victims Support Group Forum UK. The General Bar Council turned to Colemans CTTS instructing Nicholas Bacon QC, Dr Mark Friston and Greg Cox, while the Law Society instructed Kieron Beal QC on its intervention.

RPC won work from the Media Lawyers Association, instructing Gavin Millar QC and Chloe Strong on the case while Moon Beever instructed Simon Davenport QC, Tom Poole, Daniel Lewis and Clara Johnson for the Association of Business Recovery Professionals and Roger Mallalieu was instructed by the Association of Costs Lawyers.

Leigh Day partner Bains said: ‘I am grateful to the Supreme Court for ordering the Respondents to pay the success fee and the ATE premium. In many cases it would have been simply uneconomic for Claimants to continue to trial, even if they were faced with an inadequate part-36 offer, because of the likelihood of any additional damages they may have hoped to recover would have been wiped out.’