Terms of engagement

These terms set out the general terms on which we provide services to you. When you instruct us to advise on a new matter we will normally send you a retainer letter confirming your instructions. The terms of that letter (if any) and these Terms of Engagement will together form the contract between us for that matter.

Our appointment

When you appoint us to act for you in relation to a particular piece of legal work:

  • you will be authorising us to take all measures we believe appropriate to protect your interests unless you instruct us specifically to the contrary; and
  • you will be authorising us to incur reasonable expenses on your behalf.

Your requests to us for work to be done are called “instructions”.

Our advice is provided to you and may not, without our prior written consent, be disclosed to any other party. You will not refer to us or our advice in any public document or communication without our prior written consent.

Communication

We operate a primary contact system so that you will always have one lawyer here with an overview of all the work that we may be doing for you. That lawyer may not be directly involved in all of your work as we aim to provide the services of the most appropriate specialist lawyer or lawyers to deal with each piece of work.

We will ensure that further issues raised in your matter are explained to you and that you are kept informed of progress. From time to time and as necessary we will review, and advise you, as to whether the likely outcome of your matter will continue to justify the likely charges, expenses and risk involved.

For the sake of convenience, we are happy to communicate with you using normal, non-encrypted email. This form of email is not secure and there is a risk to you if we communicate confidential information to you in this way. We cannot accept liability for any communication which is intercepted or otherwise falls into the hands of those other than the intended recipient.

We will assume that we have your consent to communicate with you by this method, unless you advise us otherwise.

Fees

We are flexible and are willing to consider many different ways of charging fees. These include fixed fees, fees subject to a fee limit, percentage fees based on the value of the transaction, retainer fees or fees calculated by reference to hourly rates. However, unless we have specified another fee structure, we will charge fees primarily by reference to the amount of time spent by individuals at Harbottle & Lewis LLP on your work.

In setting our fees and our hourly rates we take into account:

  • the nature and complexity of the work;
  • the amount of time spent, knowledge required and responsibility involved;
  • the type and nature of the documents involved; and
  • the value of the transaction, property or subject matter.

Time spent on your matter will include, but is not limited to, meetings with you and others in relation to the matter, time spent travelling and waiting, considering and preparing papers, making and receiving telephone calls, correspondence, sending and receiving e-mails, attendance at Court or Tribunal, time spent in filing documents at Court and undertaking other clerking tasks, and documenting the arrangements under which we will provide legal services to you.

The amount of time spent on a matter will also be influenced by the manner in which you respond to our requests for information. Timely provision of up to date information will help us to spend less time on your matter.

Estimates we give are a guide to assist you in budgeting, but should not be seen as a definitive quotation unless this is specifically agreed in writing.

In some types of work we may be willing to agree a fee structure which depends on the outcome. We are not generally able to do this for litigation.

If a transaction or other matter does not proceed to completion, our fees (together with disbursements and VAT) will still be payable.

Any special fee (such as a fixed or capped fee) agreed for a matter will not cover additional work not identified when the arrangement was agreed.

Limits to fees

You may agree with us an upper limit for the fees and expenses that may be incurred by us without further authority in a particular case. This means that you must pay those incurred up to the agreed limit without our needing to refer to you further. Depending on the nature of the work, it may be necessary to review that upper limit with you as the case or transaction progresses.

Changes to fees

Our hourly charge-out rates are reviewed with effect from 1 June each year. We will notify you of the rates if they change and you will then be bound by them. If you do not accept the new rates after review, we reserve the right not to continue acting for you from 31 May.

Expenses

Our fee estimates do not include any expenses or payments to third parties which we may have to incur on your behalf. These are known as “disbursements”. Examples of disbursements are travel expenses, phone call charges, fax and photocopying charges, experts’ (including costs draftsmen) fees, Counsels’ fees, stamp duty and search fees. These will generally be billed at the same time as we invoice you for our fees, but may sometimes be billed at another time.

If we have to incur additional expenses for staff, other than lawyers, working overtime on evenings or weekends in order to provide an effective service to you, we may include these expenses as a separate item on our invoice to you.

Value Added Tax

All quotations or estimates of fees that we give are subject to the addition of Value Added Tax. Most expenses that we pay on your behalf will also be subject to the addition of Value Added Tax.

If our services are subject to Value Added Tax, you hereby indemnify us in full on demand for any interest, penalties or legal costs incurred as a result of any information you provide to us in relation to your Value Added Tax status not being correct.

Billing

Unless agreed to the contrary, and to help you budget for your legal expenses, we bill monthly for the work performed to date together with any disbursements we have incurred on your behalf. You must pay the bill within 14 days from its date.

You have the right to object to any of our bills and to apply for the bill to be assessed under Part III of the Solicitors Act 1974. If you are unhappy with any bill which we send you please contact your lawyer in the first instance who will try to resolve your query.

Payment

Our invoices are payable no later than 14 days from the invoice date unless we have agreed with you otherwise in writing. We may change these payment terms at any time by giving at least 30 days notice in writing. If an account is not paid in full within that period we may charge you interest on any amount outstanding from the date of the invoice until the date the bill is paid at 8% p/a, or such percentage equivalent to the statutory rate of interest prescribed for judgments from time to time in place. In the alternative and where appropriate, we reserve the right to claim interest pursuant to the Late Payment of Commercial Debts (Interest) Act 1998.

If an account remains unpaid and we decide to commence legal proceedings against you in order to recover the sums you owe us then we will be entitled to recover from you the legal costs that we incur in connection with those proceedings at our standard hourly rates, together with all disbursements (including fees of Counsel and any overseas lawyers engaged by us in our attempts to recover payment from you).

Where an account is overdue we are entitled to exercise a lien over files and documents belonging to you until our account is settled. We also reserve the right to cease continuing work for you.

If instructions for a piece of work are given by more than one person or company, we may recover our fees, disbursements and Value Added Tax from any one or more of them. This includes situations where one person or company instructs on behalf of another.

If arrangements are made for a third party to pay any of our fees or disbursements, or a court orders a third party to pay any part of our fees or disbursements, you remain liable to pay them to the extent that the third party does not pay them when due.

Payments on account

There may be circumstances in which we will expect you to make payment to us on account of our fees and any expenses that are to be incurred in connection with our work. We will tell you in advance if this is the case.
Any money that you pay to us on account will be held in our client account at National Westminster Bank Plc and unless agreed to the contrary you will be entitled to interest on it. We will offset that money on account, and any interest which accrues on it, against your bills, although our total fees and expenses may be greater than any advance payments.

Monies held subject to an undertaking

Any monies that we hold subject to an undertaking on your behalf will be held in our client account at National Westminster Bank Plc and you will be entitled to interest on them unless agreed to the contrary.

Monies held in our client account

We will not be liable to repay any money that we hold for you in our client account at National Westminster Bank Plc which is lost as a result of a failure of the bank.

Litigation

We attach at Appendix 1 a summary of the Civil Procedure Rules which apply to all Court proceedings brought by or against a party in England & Wales. This document is only a summary and the Civil Procedure Rules are subject to frequent amendment.

At Appendix 2 we attach a document setting out the basics of any litigation claim. Again this is intended as a summary only as each case will vary depending on the individual circumstances. At the end of Appendix 2 we set out an estimate of the approximate levels of costs you might expect to incur if you issue or defend a claim. This is a very broad estimate and actual costs could be considerably higher or lower depending on the circumstances of your particular case.

Litigation: your costs and those of the other party

If we act for you on a contentious matter you will be responsible to us for all the legal fees and expenses that you incur although you may be able to recover some of them from your opponent. In some cases, particularly where your opponent is legally aided and in cases before the Employment Tribunal, your opponent is unlikely to be ordered to pay any or all of your fees and expenses, even if you are wholly successful in your action. Even where a Court orders your opponent to pay your costs and expenses you may encounter an insolvent opponent who cannot pay. In these circumstances you are still liable to pay us for all the legal fees and expenses that you incur. You will also be responsible for paying the charges and expenses of seeking to recover any charges and expenses that the Court orders your opponent to pay. If the Court does order your opponent to pay some or all of your charges and expenses, in that case, interest can be claimed from your opponent from the date of the Court Order.

You agree to be liable for our charges and expenses, on the basis agreed between us in the retainer letter and these terms (and subject to any changes notified to you), notwithstanding that this amount may exceed the amount of costs which you would be permitted to recover from any other party. If you are unsuccessful the Court may order you to pay all or a significant proportion of your opponent’s fees and expenses (together with interest). You may also have to make payments in respect of your opponent’s fees and expenses at various stages in the course of the action. If you withdraw from a case you will usually be ordered to pay your opponent’s fees and expenses.

Litigation: 3rd party cover

Your liability for our charges and expenses and for your opponent’s charges and expenses (and, in some cases, liability for damages) may be covered by insurance which you may already hold. Please check your insurance policies to ascertain whether or not you have any cover, including any relevant Directors and Officers indemnity policy, household, motor, or credit card policies.

Alternatively, you may wish to obtain “After The Event” (ATE) insurance cover for some of the costs of the dispute. Appendix 3 sets out some details of this type of insurance, although please note it is by no means an exhaustive list, nor can we recommend any particular product, supplier or broker to you. Please review the details carefully and contact the lawyer you are instructing if you wish to discuss the matter further or take out such a policy.

You should also consider whether your liability for both your own costs and the costs of your opponent are covered by your employer/trade union.

In substantial litigation claims (generally where anticipated damages are in excess of £1million) you may also be able to get a funder to fund your own costs and expenses in exchange for them keeping a percentage of your damages in a successful claim – this is know as Third Party Funding. You should contact the lawyer who you are instructing if you wish to discuss this option in any more detail.

Litigation: access to documents

Documents filed at Court such as the Particulars of Claim, Defence and Reply, together with orders made in open court are available to the public. This does not apply to any documents attached to statements of case or to such orders.

Legal aid

We are not able to carry out legally aided work.

Document storage

It is our policy to store files and papers relating to your matter for a minimum of seven years from the date the matter was completed. This does not apply to any papers that you ask to be returned to you.

After seven years, we may dispose of them in accordance with the procedures recommended by the Law Society.
This policy does not apply to the storage of title documents, title deeds and other valuable documents which you specifically ask us to keep in safe custody.

If we retrieve papers or documents from storage in relation to continuing or new instructions to act in connection with your affairs, we will normally charge you for the cost to us of that retrieval. We may also make a charge based on time spent retrieving and copying stored papers or documents to you or another at your request.

Confidentiality and disclosure

We have a duty to keep the affairs of our clients and former clients confidential except where disclosure is required or permitted by law or by the clients or former clients concerned. In certain circumstances, such as in order to comply with Money Laundering Regulations and the law relating to terrorist financing from time to time in force, we may be required to provide information relating to a client or former client to regulators, including the National Crime Agency. We may also be prevented from informing such clients or former clients that a disclosure has been made or of the reasons for it because the law prevents “tipping off”.

Should we receive requests, either directly from you, or from your accountants and/or auditors, for confirmation as to whether we are instructed on your behalf, our response shall always be addressed directly to you for onward transmission. Such requests may require us to confirm whether any matters are of a litigious nature, whether any deeds or documents are retained by us on your behalf and also whether there are any outstanding bills owed by you to us or any work in progress at any given point in time.

You also agree that we may, when required by our insurers or other advisers, provide details to them of a matter or matters on which we have acted for you.

We reserve the right to charge on a time basis for work undertaken in responding to such requests.

Conflicts and confidentiality

Conflicts between your interests and those of another client may arise. If there is a conflict of interest, we might have to cease acting for you.

All fees and disbursements and VAT up to the date of termination will be charged and become due.

You agree that we will not be under any obligation to disclose to you, or use on your behalf, any documents or other information in respect of which we owe a duty of confidentiality to another client, former client or third party.

Data Protection Act 1998

As a controller of personal data we are under an obligation to comply with data protection law set out in the Data Protection Act 1998 and any other regulations made under that Act. By giving us your personal information you consent to us processing and storing your information so that we may provide you with legal services and generally administer and take care of our relationship with you. We may disclose your information to our third party service providers or agents for these purposes.

In addition we may contact you from time to time to let you know about our services which may include sending you newsletters and news on training events or changes in the law which may affect you. Please remember that you can elect not to receive such marketing material at any time by writing to our Marketing Manager or to the lawyer responsible for your work.

We can send you our full data protection policy on request.

Termination

You may, except as set out in “Restrictions to Termination” below, terminate our engagement at any time on reasonable notice. To do so you should notify the lawyer with responsibility for your matter and confirm the position in writing.

We reserve the right to terminate our engagement by you which we will confirm in writing. However, we will only decide to stop acting for you with good reason, for example, if you do not pay a bill or comply with our request for a payment on account or you fail to give us the co-operation which we are reasonably entitled to expect. We must give you reasonable notice that we will stop acting for you.

All fees and disbursements and VAT up to the date of termination will be charged and become due.

Restrictions to termination

Where the Consumer Protection (Distance Selling) Regulations 2000 apply to the work we undertake for you (for example if you have instructed us over the telephone or by email), you acknowledge that on our commencing that work you will be incurring fees attributable to that work. Because we will have commenced work at your request, you may not cancel your contract with us in relation to the work that has been done (or expenses and charges incurred) and our fees for that work will be payable by you.

With respect to contentious matters, if we are on record at Court as acting for you in any proceedings the consent of the Court may be required before we can be removed. To that extent your right to terminate our engagement may be restricted and you will be liable for our fees and charges until such date as we are no longer on the record as acting for you.

Limitation of liability

As we are a Limited Liability Partnership (“LLP”), the work carried out for you will be carried out by Harbottle & Lewis LLP and your contract is with Harbottle & Lewis LLP only, and not with any member, employee or consultant of Harbottle & Lewis LLP. Should you need to make a claim (whether in contract or otherwise) against us in relation to any piece of work we carry out on your behalf or otherwise, that claim may only be brought against Harbottle & Lewis LLP, and none of the members, employees, consultants or agents of Harbottle & Lewis LLP would have any liability in respect of any such claim. You agree that you will not make any claim against the members, employees, consultants or agents of Harbottle & Lewis LLP, and you will only make any claim against Harbottle & Lewis LLP.

Although we are an LLP which has “members” and not “partners”, we have decided to maintain the title of “partner”. We use the title “partner” for members and certain senior solicitors who are not members, but who are consultants or employees of Harbottle & Lewis LLP with equivalent standing and qualifications to the members.

We limit our liability to you for claims:

  1. for breach of contract;
  2. for breach of duty;
  3. for negligence (except insofar as the Solicitors Act 1974 s 60 (5) provides that liability for negligence cannot be limited in contentious business); and
  4. for claims otherwise arising out of or in connection with our engagement or the services we provide,

in the two ways described below.

First, our liability shall be limited to that proportion of the loss or damage (including interest and costs) suffered by you, which is ascribed to us by a Court of competent jurisdiction allocating proportionate responsibility to us having regard to the contribution to the loss and damage in question of any other person responsible and/or liable to you for such loss and damage. Secondly, our liability to you is limited to the higher of:

  1. £3 million; or
  2. 10 times the amount of our fees billed on the matter in question.

For the purpose of these Terms of Engagement the word ‘damage’ has the same meaning as in the Civil Liability (Contribution) Act 1978, which provides a mechanism for liability sharing where there is a claim against more than one person for the same damage.

Where you have a number of advisers, including us, advising you on a matter there is a risk that we will be prejudiced by any limitation of liability which you agree with those advisers. This is because such a limitation of liability might also operate to limit the amount which we could recover from the other adviser by way of contribution if we were required to pay to you more than our proper share of a liability for which the other adviser was jointly liable with us. You therefore agree that our position will not be adversely affected by the limitation of that other adviser’s potential liability i.e. we will not be liable to you for any amount in excess of our proper share of a joint and several liability which we are not entitled to recover from any other advisers by reason of your agreement to limit their liability.

If you start proceedings against us for loss or damage and there is another person (for example, another adviser) who is liable or potentially liable to you in respect of the same loss or damage, then you will if we so request join them into the proceedings. This is subject to any legal prohibition against your joining them in that way.

The exclusions and limitations in this section shall have no application to any liability for death or personal injury, any other liability which cannot lawfully be excluded or limited or to liability arising as a result of fraud on our part.

Harbottle & Lewis LLP maintains professional liability insurance at a level that we have determined is prudent with respect to the provision of our services. On reasonable notice to our office, we will make available to you relevant information relating to this insurance, such as the contact details of our insurers and its territorial coverage.

Financial Services and Markets Act 2000

We are authorised by the Financial Conduct Authority to undertake non-mainstream regulated activities. We provide investment services only as part of the professional services we have been engaged to provide. If during a transaction you need advice on investments, we may refer you to someone who is authorised by the Financial Conduct Authority to advise on investments.

Independent services

When we are asked to recommend the services of a third party (such as an advisor authorised by the Financial Conduct Authority, a surveyor, trade mark agent, accountant or foreign lawyer) we shall always do so in good faith. However, no warranty is given in respect of the standing, ability or the quality of the services of a third party. We do not accept liability for that third party’s services and you will have a contract with that third party, but not with us in respect of that third party’s goods or services. You will be responsible for the fees and expenses of that third party.

Excluded advice

Unless specifically agreed with you in writing in our retainer letter our advice to you will not extend to advice on the tax or pensions’ implications of the work on which we are advising you.

Unless specifically agreed with you in writing in our retainer letter, we will not keep under review, or re-visit in the future, any advice which we give to you in relation to any instruction.

English law

All of our advice is given on the basis of the laws of England and Wales. To the extent we advise on documents governed by the laws of other jurisdictions, we will not be advising on any specific implications of the laws of those jurisdictions.

Force majeure

We shall not be liable to you if we are unable to perform our services as a result of any cause beyond our reasonable control. In the event of any such occurrence affecting us we shall notify you as soon as reasonably practicable.

Application of these terms and amendments

These Terms of Engagement supersede any earlier terms of business we may have agreed with you and, in the absence of express agreement to the contrary, will apply to the services referred to in any retainer letter accompanying these Terms of Engagement and all subsequent services we provide to you.

Rights of third parties

Our agreement with you is personal as between you and us and is not intended to confer any rights of enforcement on any third parties pursuant to the Contracts (Rights of Third Parties) Act 1999.

Governing law and jurisdiction

This agreement and any dispute or claim arising out of or in connection with it or its subject matter or formation (including non-contractual disputes or claims) shall be governed by and construed in accordance with the law of England and Wales.
The parties irrevocably agree that the Courts of England and Wales shall have exclusive jurisdiction to settle any dispute or claim that arises out of or in connection with this agreement or its subject matter or formation (including non-contractual disputes or claims).

Regulation

We are authorised and regulated by the Solicitors Regulation Authority.

Harbottle & Lewis LLP
April 2016

 

Appendix 1

Civil Procedure Rules – A guidance note for clients

Under the Civil Procedure Rules, initiating Court proceedings is viewed as an absolute last resort. The historical possibilities of aggressively commencing proceedings or defending them through no more than stonewall tactics are no longer tolerated by the Courts, nor is the tactic of deliberately playing procedural games in an attempt to bludgeon your opponent into settling with you.

Full factual investigations are required at the very beginning in order that we may make a fully informed legal analysis of your case and advise you accordingly.

Pre-Action Protocols exists which require all parties to any potential litigation to engage in pre action correspondence. In addition, a number of case specific Pre-Action Protocols exist (for example in construction, defamation, professional negligence and judicial review claims), all of which require an early exchange of information and evidence by all parties to a dispute on an open and co-operative basis. In appropriate cases, the identity of any expert witness must be agreed, and instructions are given jointly so far as may be possible.

All parties to a dispute are required by the Courts to consider the possibility of resolving it in some way other than by litigation, and all appropriate types of alternative dispute resolution (ADR) must be canvassed and considered by all sides at an early stage. In order to ensure this happens, the Court will examine the parties’ conduct and any apparent failure to comply with these obligations can lead to adverse costs awards being made against any party whose conduct is found wanting, regardless of which party is ultimately successful in any action.

Once proceedings have been commenced, the Court takes over control of the process itself, and engages in active case management. Accordingly, the Court will often initiate stringent directions for the conduct of the proceedings up to trial, with tough sanctions readily applied. If orders are not complied with, or if any party’s behaviour is deemed to be unreasonable, or indeed if any interim application fails, then the Court will usually make an adverse costs order. Costs awards made against a party to proceedings before trial are now invariably payable within fourteen days, and not (as used to be the case) wrapped up after trial with all of the other costs orders. This has very real cashflow implications for the running of any action. The effect of this increased risk of adverse costs orders means that any step, however desirable, must be considered very carefully in order that any risk is taken on an informed basis. If in doubt, caution and reasonableness must prevail over any other impetus.

In addition, the rules require significant management involvement from clients at an early stage. The overall effect is to front load some of the costs of litigation. Because of the timetabling imposed by the courts and the cashflow implications of the Civil Procedure Rules, very careful consideration must be given before deciding whether to assert a right or defend a position which may well be entirely justified as a matter of strict law.

You must also bear in mind that the overall rate of recovery of costs is far less than 100%. Typically, even if a party is wholly successful, it would only be awarded an amount of costs at a maximum of around 60% to 75% of its actual outlay. The Civil Procedure Rules (in particular the summary assessment of costs on interim applications mentioned above) has led to a further reduction of the percentage rate of recovery. The question of whether or not the unsuccessful opponent is actually able to pay that award must also be taken into account.

During the course of your action, each party is under an obligation to ensure that all relevant documents, even if they are prejudicial to your case, are preserved and in due course disclosed to the opponent. In essence, all parties to a dispute owe an obligation to the Court to preserve all documents (which includes not only papers, but also information stored in any electronic or other format), from the outset of the dispute and to disclose to the other parties all such documents as may be relevant. We have detailed guidelines to help our clients understand the nature of this very important obligation in full, which we will happily provide to you.

 

Appendix 2

Litigation: The basics

In case you have not been through the litigation process before, we have set out below some of the basic steps that are involved in most of the proceedings in this jurisdiction. This is intended to be a broad brush guide to give you a flavour of how litigation tends to proceed. Of course we will give you specific advice relevant to your case as it progresses.

Letter of claim

The parties are required to exchange information relevant to the claim prior to any proceedings being commenced. The starting point is for the prospective Claimant to send the prospective Defendant a formal Letter of Claim setting out the claim in full. The prospective Defendant then has an opportunity to respond. From the outset, all documents which might be relevant to the case must be preserved.

Beginning the proceedings

In order to then begin the court proceedings, a Claim Form and Particulars of Claim are issued at Court and served on the Defendant(s). These are often drafted by a barrister who is instructed and who remains involved in the case (each side will usually instruct a barrister). A Court fee is incurred at this stage as well as fees for the barrister. The Particulars of Claim set out in detail the nature of what has happened and what the Claimant seeks from the Defendant.

Responding to the proceedings

This is the opportunity for the Defendant to set out their case in response to the Particulars of Claim by serving a Defence. Again, this is usually drafted by the barrister. To the extent the Defendant has a Counterclaim, this is incorporated separately into the Defence.

Reply and defence to any counterclaim

The Reply is an opportunity for the Claimant to answer anything the Defendant puts in their Defence and put in a Defence to any Counterclaim that has been brought by the Defendant. The process up to this point in the case can take several months to complete.

Case management conference

The parties’ solicitors often attend at this stage a short procedural hearing at Court to agree the timetable for the remainder of the case. Sometimes, these steps can be agreed and attendance at Court can be avoided.

Interim applications

It is necessary in most cases to make or defend applications made to the Court during the case which deal with various procedural matters. Such applications, which are heard by the Court, tend to be short hearings to determine, for example, contested changes to timetabling, security for costs and other interim points in the case.

Disclosure and inspection

This is the next stage of the claim where the parties exchange documents that are relevant to the issues. All documents, whether they help your case or affect it adversely, must be disclosed. A Disclosure Statement must be signed by each party confirming that Disclosure obligations have been complied with. The obligation to disclose relevant documents continues throughout the litigation. Even if documents are discovered after the formal disclosure step has taken place you will be required to disclose them to the other party.

Witness statements

This is the opportunity for each side to set out in writing their position, often explaining all the detailed facts in the case. Witness Statements are provided by individuals who have evidence that is key to the issues in the case. The parties exchange witness statements simultaneously.

Expert evidence

Depending on the type of case, sometimes it is necessary for experts to be instructed and to provide evidence to assist the Court in deciding the issues in the case. The experts often meet to see if they can find any common ground between them.

Mediation

Mediation is one of the forms of alternate dispute resolution (“ADR”) available to the parties in litigation. It can take place at any stage in a case, and often takes place shortly after the Case Management Conference. On other occasions, however, it is more appropriate for mediation to take place once expert evidence has been exchanged. The appointed mediator acts as a neutral referee to help the parties work towards settlement. If successful the mediation will result in agreement which ends the litigation, otherwise the case continues.

There are other means of trying to settle proceedings. These include “without prejudice” offers to settle, as well as what are referred to as Part 36 offers. These two types of offer have different costs implications, and it is a tactical decision as to how, if and when such offers are deployed.

Pre-trial review

In certain cases, the parties’ solicitors need to attend before the Court to discuss how the trial itself will be timetabled and to iron out any procedural issues that have arisen in the case so far.

The trial

A large proportion of cases settle before the first day of Trial. For the cases that proceed to Trial, however, this is the forum for the Court to decide the legal issues in the case and to hear the evidence from those individuals who have provided Witness Statements and any expert evidence. In many cases, the Judge will not decide the issues immediately but will reserve Judgment to a later date.

Appeals

Once the Judge has handed down Judgment and costs awards have been dealt with, the losing party can consider applying for permission to appeal all or part of the Judgment. In County Court cases, the decision of the Circuit Judge is first appealed to a High Court Judge, whose decision can be appealed to the Court of Appeal. In High Court cases, it is the Court of Appeal that first considers the appeal.

Further appeals can, in certain circumstances, be heard by the Supreme Court (formerly the House of Lords) and thereafter by the European Court of Justice or the Privy Council.

Set out below is an estimate of Harbottle and Lewis’s fees for a typical piece of small to medium commercial litigation. These estimates are not intended to be fixed. The figures below do not include estimated disbursements such as Counsel’s fees, Court fees and expert’s fees, which will be payable in addition.

ToE table

Appendix 3

After the event insurance

Please note that this type of insurance is only available to cover legal costs, and not any damages that may be awarded against you.

Insurance is available on the market to cover most of your charges and expenses incurred with us, and your possible liability for your opponent’s charges and expenses. This type of insurance is known as after the event insurance (“ATE Insurance”). Most ATE Insurance policies for commercial cases will only usually cover your liability to meet your opponent’s charges and expenses, but there are providers who will also provide cover for your own disbursements and sometimes even your own costs. We can discuss your options with you as and when it becomes appropriate.

Premium

The cost of taking out ATE Insurance (i.e the premium you pay) can be considerable, often running into many thousands of pounds depending on the level of cover you require. Premiums are payable in one of three ways;

  1. Upfront – you will be required to pay the whole premium when you take out the ATE policy
  2. Staged – you will be required to pay the premium in stages as the litigation progresses
  3. Deferred – you are not required to pay the premium until the conclusion of the proceedings

Recoverability

The cost of taking out ATE Insurance (i.e. the premium you pay) may be recoverable from your opponent should you be successful in your action and have a costs order made in your favour. To be able to recover any premium, however, the existence of the policy must be disclosed to the other side as soon as the policy is taken out. Once the policy has been disclosed, should you be successful in your action and have a costs order made in your favour, the Court can consider the cost of the premium as part of your costs of the action. However, you should note that although you may obtain an order that your costs be paid by another party, enforcing that order and having those costs actually paid to you is a separate question and can be difficult. Some ATE providers will agree that if you are unable to recover the premium from your opponent then it will be waived but this is not true for all policies and proper enquires must be made with each provider.

Independent brokers

In order to obtain ATE Insurance you may well consider it best to go through an independent insurance broker. This should help to ensure that you receive competitive quotes for insurance, which will be particularly important if you are trying to claim back your premium under a costs order. We have obtained the details of several insurance brokers who we understand will consider the details of your case (which will include a risk assessment and usually a formal written Opinion from Counsel), and then put those details to the insurance firms they deal with to see if they can obtain a policy for you. Please note that some of the brokers in the ATE Insurance market will charge you a non-refundable fee for obtaining a quote.

Other products

You may wish to consider some other products in addition to ATE Insurance, including premium loan funding and premium insurance, both of which you may wish to take out to cover the initial costs of the premium for your ATE Insurance. Premium payment arrangements may also be available in some circumstances whereby the premium for your ATE Insurance can be paid in instalments over several months. You should note, however, that in relation to premium loans if you were to take out such a loan and be successful at Court, the other party would not be liable in an adverse costs order to pay the interest on the premium loan. The interest payments will need to be met by you.

The loan provider may also require that further insurance (called Litigation Funder’s Indemnity Insurance) be taken out by you with a third party insurer to provide security for the premium loan. However, if you were to take out a loan but were not successful at Court, the main insurance policy can cover the costs of the premium and the interest payable on the premium loan as well.

Details of brokers

The details of three brokers which operate in the ATE Insurance market are given below.

You will appreciate that we are unable to provide you with any recommendation as to which policy or broker you should use (there are likely to be many more in what is a relatively young but growing insurance market), and if so, which product(s) would be suitable for you. However, if you do decide to proceed we will gladly provide you with assistance on matters such as the case and/or risk assessments should you require it.

  1. IPC Insurance Brokers Limited
    Contact – Ian Potter 01283 791914.
    IPC Insurance Brokers do not charge a fee for considering an ATE insurance application.
  2. THE JUDGE
    www.thejudge.co.uk 
    Application Fee: £149 plus VAT (correct as at February 2010) – payable even if no policy is sourced.
  3. Legal Ex Plus
    www.legalexplus.com
    Legal Ex Plus brokers do not charge a fee for considering an ATE insurance application.