The firm launched a scheme last week (16 May) that will see it assess all new and existing litigation cases to see if they can be carried out using a method of external funding.
The scheme, called ‘Contro£’, means the firm will try to act on every case using a conditional fee agreement of approximately 50% as well as offering after-the-event insurance and third-party litigation funding.
Where possible the three will be offered together, potentially allowing clients to avoid directly paying legal costs. A committee made up of contentious group head Simon Twigden, disputes partner John Gatenby and contentious business director Chris Howe will review any decision where lawyers think funding should occur.
Twigden told Legal Week: “Litigation is very expensive in this jurisdiction so we thought we could develop a series of products and tools that we could offer our clients to effectively ‘park’ the cost of litigation on their balance sheets. We can now give clients far more financial certainty than they have ever had in the litigation arena.
“After speaking to clients and FTSE 100 companies, they kept saying they wanted greater certainty and control on the costs involved in an inherently uncertain process, and this is what we have done. This can even result in cost-free litigation on the right cases.”
The move, which comes against a backdrop of growing interest in third-party funding for litigation, has surprised many in the market.
Clifford Chance arbitration partner Audley Sheppard commented: “Clients are clearly interested in having all legal services carried out cost-effectively, including dispute resolution, so novel ideas as to how clients might reduce legal costs and risk I am sure will be worthy of serious consideration. I would expect a number of entities to be attracted by that scheme. However, it will not be for everyone. ”
Barlow Lyde & Gilbert commercial litigation partner Tim Strong added: “This is definitely new and definitely interesting. However, I am sceptical about whether this is the future. I am not sure it will be attractive to all clients. It will be interesting to see where this goes though.”
