The shape of litigation

Emma Bufton: Hello. My name is Emma Bufton and I am a Senior Associate at Gowling WLG. I also co-chair ThinkHouse Foundations which is a network for in-house lawyers at the start of their careers. We provide tailored training, development and resources exclusively for paralegals, trainees and lawyers of up to five years PQE. At our most recent ThinkHouse Foundations Event, Senior Associate and also co-chair of ThinkHouse Foundations, Tom Cox, from our Commercial Litigation Team, spoke about the shape of litigation. So Tom, to start with, can you walk us through what you mean by the shape of litigation?

Tom Cox: Well I can certainly try Emma. Of course, it goes without saying that no two cases are the same and each will have their own idiosyncrasies and quirks. However, what I was trying to do in this session was give the audience a picture of what a typical case on the multi-track in the Civil Courts might look like and to identify at what point and at what levels costs are likely to be incurred.

Emma: Did you reach any conclusions on this?

Tom: Well on the one hand, this is a largely impossible exercise because of the numerous imponderables relating to quantum, conduct of the other side and so on. There are so many factors that can affect what a piece of litigation will cost and I am not a sufficiently brave man as to make sweeping assertions in front of an audience of bright in-house lawyers. However, there certainly are some traits and trends that can be readily identified. For example, owing to the increase in work and engagement required of solicitors at a case management stage, it is clear that post the Jackson reforms, a significant proportion of costs are now being frontloaded. This is not necessarily a bad thing. Indeed, in my view anything to ensure a better control of costs, and that cases are run more proportionally, must be positive; but it does have the knock on effect that the parties are needing to dip into their pockets earlier.

Emma: OK so that is one example, but are there are there any others?

Tom: Well another example that has been kicked around pretty hard in the context of access to justice arguments is the question of Court fees which have increased spectacularly over the last few years. I am not going to share with you my views on that now, but it does mean that if you are intent on bringing a claim, you are now required to stump up a sizeable sum right at the outset to satisfy the issue fee; in the cases of claims worth more than £200,000, we are talking about a £10,000 Court fee which is obviously not petty change, at least not for me.

Emma: OK so I can see that costs are being frontloaded but what does that mean for the parties?

Tom: Well obviously it has an impact on how parties budget which I think was of particular interest to those in the room this morning who are required to report back to the business for every penny, and it will also likely have an impact on the windows for settlement.

Emma: What do you mean by that?

Tom: Well what I am really talking about here is the times within the litigation process where settlement is more or less likely to happen. Historically, I suspect the statistics will show that other than at the doors of the Court immediately before or during trial, settlement is most likely to occur either pre-action, or alternatively shortly after service of the pleadings or after inspection of disclosure. I do not think that has necessarily changed, although my sense is that as costs of issuing a claim and carrying out disclosure have increased, disputes are now most likely to settle either pre-action or at the case management stage. This is because in both of those cases, the costs that have been incurred by the parties are likely to be comparatively limited as set against the likely total expenditure which makes settling the dispute commercially much more attractive if the consequent costs can be ultimately avoided.

Emma: That is all very interesting. So what else did you cover?

TLC1: Well aside from looking at the question of costs, we also tried to look at the inter-relationship of in-house and private practice lawyers in the context of litigation and specifically how in-house lawyers can really add value, saving everyone time and themselves some costs.  

Emma: OK so what did you come up with?

Tom: Well there was quite a lot to be honest. In my experience what private practice litigators hate whether working with an in-house team or a lay client is surprises, be that last minute realisations that documents have been deleted or the sudden discovery of an email account that no one knew existed, or even something as mundane as a key witness having recently left the business without anyone having thought to plan ahead and at least get a brief statement from them. Those kind of surprises are generally avoidable and in-house lawyers are of course really well placed to make sure that proper procedures are in place and that the business is being communicated with at all times.

Emma: So anything else that you wanted to touch on.

Tom: Well one point that was also alighted on was a pretty basic one but something that appears to go wrong comparatively regularly and that is ensuring that everyone on the team is aware of their responsibilities and what it is that they are supposed to be doing. I know that that seems such a basic point and a management one really rather than a legal one, but with significant teams of private practice and in-house lawyers, you risk having too many chiefs and not enough chieftains such that it takes an age to make a decision and that smaller tasks fall through the gaps. I am sure this is largely the fault of private practice solicitors, but it is a scenario that happens remarkably often.

Emma: That all sounds good stuff Tom and I am glad to hear you are finally taking some of the blame for a change. Do you have any final takeaway points for the listeners listening to this Podcast?

Tom: Well to be honest we did cover an awful lot of ground in the session so I would probably rather glibly just say make sure you come to the next one! But in all seriousness, I think the most interesting points of discussion both in the session and afterwards related to costs. Costs are central to everything we do, alongside analysing risk. The more a party is aware of what a matter is costing and is going to cost, the better informed they are likely to be as regards settlement and therefore the better and more pragmatic a solution that is likely to be reached. The basic figures will tell you that the majority of disputes end in settlement so the sooner that you can get to grips with the numbers, before the costs have ratchetted up the better the deal you are likely to get.

Emma: Thanks for all that Tom. That is all great stuff and I am sure of really helpful use to our listeners. I don't know about you but I am certainly going to go away and have a think about my costs budgets. If you do need any further guidance from anything raised in this Podcast, then you can contact Tom at tom.cox@gowlingwlg.com.