Allowing lawyers to invest directly in litigation is coming, says QC

Bacon: document your funding advice

Bacon: document your funding advice

Solicitors will be funding litigation directly in the next few years, a leading silk predicted last week.

Nick Bacon QC said he did not understand why cases from the nineteenth and early twentieth centuries were still driving the law on lawyers sharing in the proceeds of litigation in this way given that there was no practical distinction with conditional fee or damages-based agreements (DBAs).

Speaking at the JLT commercial litigation conference in London last week, the 4 New Square barrister said he had seen some DBAs being used, despite continuing concerns about the rules governing them. One solicitor, he recounted, had “taken a punt” on a case with a DBA and made more from that one matter than he had from a decade of litigation.

Mr Bacon added that he thought the courts would do their best to uphold DBAs if they were challenged so as to encourage their use.

In a speech about retainers, he emphasised the importance of attendance notes and client confirmation of the advice given about costs and fee arrangements – “I’ve seen many cases where there was no attendance note,” he said – and of solicitors understanding the products they recommend to clients.

“I see solicitors signing clients up to products that they didn’t need,” he said, recalling one case where the solicitor recommended after after-the-event insurance to cover the part 36 risk, without realising that it only kicked in once the damages had been exhausted.

Insurance brokers were a “useful middle man” because their evidence in court was hard to counter, Mr Bacon added.

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