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Dispute Resolution

The growth of litigation funding
Thursday 9th March 2017

According to recent research the use of litigation funding has grown more than 25% in the last year from £575m in 2015, to £723m in 2016. These figures are based on the balance sheets of the twenty largest independent litigation funders, whose businesses revolve around paying towards the legal costs for parties in litigation in exchange for a share of any damages recovered.

In terms of how litigation funders operate within a claim, they tend to defer to the claimant and their lawyers for the overall litigation strategy. It is this level of freedom, combined with the pressure on in-house legal budgets and fee income for law firms, that has led both to increasingly engage with litigation funders to better understand how they can fund litigation in their business, in the same way they have historically funded other aspects of their business.

Lord Justice Jackson’s reforms have also acted as a catalyst to the litigation funding sector. For example, in insolvency litigation the reforms have ended the insolvency profession’s exemption, meaning that conditional fee arrangements based on success fees and after the event insurance premiums will no longer be recoverable in proceedings brought by liquidators, administrators or trustees in bankruptcy. This has had the effect of insolvency lawyers engaging with litigation funders on a more frequent basis.

Litigation funding will still be used as a way to allow parties with limited financial resources to pursue claims against wealthier organisations, where the legal costs may have otherwise been too high. Yet, the litigation sector’s elevated awareness of the benefits of litigation funding, as well as regulatory changes to the litigation industry as a whole, mean that litigation funding is no longer used out of pure economic necessity alone, but as a commercially viable option for businesses and law firms alike. 


Can trustees seek costs protection in proceedings if they are beneficiaries too?
Friday 24th February 2017

Trustees have an expectation that legal costs they incur will be indemnified from the trust.  That expectation must be balanced with their duties to act in accordance with the interests of the trust’s beneficiaries.

If legal proceedings are commenced trustees should consult with beneficiaries about the legal costs being indemnified from the trust and the consent of beneficiaries to this should be sought. If all the beneficiaries do not agree to this the trustees can only get the protection they seek by making application to the Court for that protection and asking the Court to sanction their intended response to the claim. Applications of this type are known as Beddoe applications named after a leading case on the subject.

The High Court has recently clarified whether a trustee is entitled to the protection of a Beddoe order if they are also a beneficiary of the trust

In the case of Pettigrew and Others v Edwards [2017] EWHC 8 (Ch) two trustees faced a claim by a life tenant for income from the trust. The trustees sought protection from the Court for the approach they intended to take and the legal costs they would incur in response.

On the facts of the case the Court concluded that, after the life tenants’ death, the two trustees would effectively be the only beneficiaries of the trust. Once that finding was made the Court determined that the trustee beneficiaries were capable of deciding whether to pursue a claim or not.

On the specific facts of this case, it would be unjust to give the trustee beneficiaries the protection they had applied for against the possible adverse costs consequences of the claim. The approach that the trustee beneficiaries were intending to take towards the proceedings was determined primarily by their status as beneficiaries and not their status as trustees.  For that reason the making of a Beddoe order was deemed inappropriate.

For more information on the court’s Beddoe jurisdiction please visit:


Can estate beneficiaries benefit from the deceased’s Inheritance Act claims?
Tuesday 21st February 2017

Are other claims that were not pursued relevant to the value of reasonable financial provision claims?

Laurel Roberts and Francesca Milbour, the step-daughter and niece of Pauline Milbour have brought proceedings against her estate of approximately £25 million claiming reasonable financial provision.

Pauline Milbour was married Leonard Milbour and they both had children from previous relationships.  Pauline Milbour died before her husband aged 73 in 2014.  Her will which had been made in 1993 many years after her marriage left the majority of her wealth to her natural daughter, Luanne. 

Under his wife’s will Mr Milbour, received £150,000 absolutely and an interest in income from £75,000.

Although he would have had standing to bring a claim for reasonable financial provision against his wife’s estate Mr Milbour did not do so before he died shortly after her death.

Pauline Milbour’s step-daughter and niece have now brought claims against her estate pursuant to the Inheritance (provision for family and dependants) Act 1991.  The claims are for reasonable financial provision on the bases that they were treated as a ‘child of the family’ and financial dependency.  Those claims are defended.

At a preliminary hearing the Court had considered the novel argument that Mr Milbour could have made a successful claim for reasonable provision from Mrs Milbour’s estate if he had not died so soon after her death and that, had he done this, his estate would have been significantly more valuable and there would be more funds available in his estate to be distributed to beneficiaries or to be subject to claims for reasonable financial provision.

The court has rejected the argument that the ability of Mr Milbour to bring a claim against his wife’s estate should be a factor in deciding the merits or value of the claims by Laurel Roberts and Francesca Milbour against his wife’s estate. 

That issue having been determined the claims will proceed to trial where it will be for the claimants to show that on the facts they were treated as a child of Mrs Milbour’s family and that there was financial dependence on her during her lifetime.

For more information about financial provision claims please visit:


Worldwide freezing injunction upheld
Wednesday 8th February 2017

In a recent decision the High Court of Justice has determined that a post-judgment worldwide freezing order should continue indefinitely until payment of the judgment or a further order is made (Touton Far East Pte Ltd v Shri Lal Mahal Ltd (formerly Shivnath Rai Harnarain (India) Ltd), [2016] EWHC 1765 (Comm)).

The worldwide freezing injunction was granted in favour of the claimant, Touton Far East Private Limited against Shivnath Rai Harnarain Limited (‘SRH’), an Indian company in relation to a Grain and Feed Trade Association (GAFTA) arbitration award which was worth over $4 million.

SRH was originally given until March 2016 by the Court to apply to vary or discharge the order. SRH asked for an extension of time to appeal, and also argued that the freezing order should not be indefinite and suggested that an appropriate period of time would have been one month.

The Court refused SRH’s request for an extension and determined that the freezing order would remain in place until payment of the judgment debt or further order of the Court.

In concluding that the order should remain in place, the Court determined that the defendant was in a position to pay the judgment at any time (as it was clear that the defendant was a substantial company) and was therefore choosing not to pay the debt as opposed to being unable to pay. The Court also held that, if it was determined at a later date that the freezing order was being maintained by the claimant for an illegitimate purpose, the Court’s position could be reconsidered at that time.

Clearly, the Court in this instance was keen to ensure that the English judgment is given the opportunity to be enforced successfully and this case demonstrates the effectiveness of freezing injunctions even after an initial judgment has been obtained.


Interest Rate Swap Claims Update – Court hands down Judgment in Property Alliance Group Ltd v RBS
Thursday 12th January 2017

The High Court has now handed down the long-awaited judgment in Property Alliance Group Limited v The Royal Bank of Scotland PLC. The decision will be of particular interest to litigants pursuing or contemplating interest rate swap claims and also London Interbank Offered Rate (LIBOR) claims.

The Claimant is a property investment and development business and the Defendant provided them with commercial banking services. That included 4 interest rate swap products, entered into between 2004 and 2008.

In summary, the Claimant claimed that the swaps were mis-sold; that the bank moving them to their Global Restructuring Group (together with their management within the group) was a breach of contract; and that the swaps should be rescinded and/or that they should be awarded damages because of the bank’s alleged participation and knowledge of the manipulation of LIBOR rates.

Following a 38 day trial before Aspin J, Judgment has now been handed down and the Court has dismissed all three parts of the claim.

The Judgment includes important findings regarding the extent of the duty of care owed by the bank. In selling interest rate products the banks owed a duty to take reasonable care not to mis-state the facts. In this case the Claimant argued that the duty of the bank here was wider than that, and included a duty to fully, properly and accurately explain the transactions. The Judge held that any duty to advise had been expressly excluded in the terms of the contract between the parties.

The Judge also said that whether the duty of care is wider than a duty not to misstate the facts, is dependent on the facts of each case and that, where the bank was acting outside of an advisory relationship, she was not bound by previous authorities to find that there was a wider duty to “explain fully the products”. The Court also found that in this case there was no implied contract term of good faith or duty on the bank not to withhold important information.

The Judgment is also bad news for Claimants bringing claims related to alleged LIBOR mis-selling as the Judge found that here the offering of swaps that were referable to LIBOR rates was not in itself sufficient to give rise to implied representations regarding the setting of those LIBOR rates.

The Claimant has said that it is assessing the basis for an appeal.



Cuba Offers Rum in Payment of US$276 Million Debt
Friday 16th December 2016

Parties to disputes often discuss creative terms of settlement but one of the more unusual is the offer by Cuba to pay off its debt to the Czech Republic, with rum.

The debt arises from the Cold-War era when both countries were in the communist bloc, and amounts to US$276 Million, the equivalent of £222 Million.  The Czech Republic imports rum from Cuba and according to the Czech finance minister the Cuban authorities have offered to make payment of the outstanding debt by supplying rum to the country.

It has been reported that the Czechs would still prefer payment, at least partly, in cash.

The opportunity to propose different forms of payment is one of the attractions to parties of using alternative means of dispute resolution than the Courts.  Where a Judge can order a payment of damages in cash, alternative dispute resolution (ADR), such as mediation or a joint settlement meeting, enables the parties to discuss more creative forms of payment.

For example in disputes between businesses a settlement may be agreed whereby one party provides services to the other to the value of the settlement sum.  Sometimes that will not be appropriate where the business relationship has broken down, but assuming that the parties are prepared to deal with each other in future this sort of settlement can have cash-flow advantages for the ‘paying’ party.

A transfer of goods can also be offered as a form of payment, and if the Cuban offer is accepted the rum-drinkers of the Czech Republic will be very pleased with those settlement terms.


STAR LAWS - Probate implications of Star Wars Episode VII: The Force Awakens
Thursday 15th December 2016

To celebrate the coincidence of the release of the new Star Wars Film, Rogue One, and the launch of our new contentious probate website,, we have considered the probate implications of Star Wars Episode VII:  The Force Awakens.

As we are going to be discussing events after death obviously you should not read on if you have not seen (but plan to see) The Force Awakens.

For the purposes of this exercise we have assumed that the law of England and Wales will apply in a galaxy far, far away.



To our great disappointment The Force Awakens concluded with Han Solo being murdered by his estranged son and unceremoniously fell off a bridge.

Han was not married and, as far as we are aware, not co-habiting with anyone for any length of time.  The life of an intergalactic smuggler is probably inconsistent with that.  This rules out claims from a spouse or cohabitee to a reasonable financial provision from his estate under the Inheritance Act (Provision for Family and Dependants) Act 1975.  We should not discount the possibility that there may be unknown dependants.

As far as we are aware Han held no joint bank accounts or any jointly owned property which would pass automatically to any joint owner by way of survivorship. 

We suspect that Han’s only real asset will be the Millennium Falcon. 

Han may have made a will and, if so, the assets in the estate would pass according to the specific gifts and legacies in that will.  As Han was murdered by his son his son will not be permitted to benefit from the estate whether there is a will or not. We do hope that Han did make a will and left the Millennium Falcon to Chewbacca.

If Han did not make a will there are potentially alarming consequences.  As there is no other known family member then the conclusion must be that the Millennium Falcon and any other assets will be treated as what is known as ‘Bona Vacantia’ and will pass to the Crown estate.

For a more practical information on the real world application of these principles and for further information please visit


A step closer to defining the term ‘client’ for Legal Advice Privilege?
Wednesday 14th December 2016

In the recent case of RBS Rights Issue Litigation [2016] EWHC 3161 (Ch), at an interlocutory hearing, Mr Justice Hildyard was asked to consider RBS’s claim to privilege in relation to transcripts, attendance notes and other records of interviews conducted with employees and ex-employees.

The Judge in his ruling applied a narrow interpretation of who is a client for legal advice privilege purposes, as a client will consist only of those employees authorised to seek and receive legal advice from their lawyer. Furthermore, legal advice privilege does not extend to information provided by employees and ex-employees to or for the purposes of being placed before a lawyer. This reasoning was following the Court of Appeal’s decision in Three Rivers District Council and others v Governor and Company of the Bank of England (No 5) [2003] QB 1556, a judgment that has been the subject of much criticism for not sufficiently clarifying who is a lawyer’s ‘client’ for the purposes of legal advice privilege. Hildyard J himself alluded to such criticism by stating ‘there is, to my mind, force in these criticisms and attempts to confine the application of the decision in Three Rivers (No 5).

In CITIC Pacific Limited v Secretary for Justice and Commissioner of Police (unrep, 29/06/2015, CACV 7/2012), the Hong Kong Court of Appeal rejected the approach to legal advice privilege as established by Three Rivers (No5). Instead the Court adopted a broader test, which was based on deducing what is the dominant purpose of the document or communication. This test is more akin to the test that applies to litigation privilege, which appears more sensible, as it focuses on the substance rather than the form. Such an approach would also avoid the need for corporate clients to abide by unnecessary formalities in an attempt to obtain the protection of privilege for documents produced as part of the process of obtaining legal advice.

In the light of all these criticisms RBS has indicated that it will seek permission to appeal the decision. There is now hope that the Supreme Court will have the much awaited opportunity to revisit the law on privilege and answer the fundamental question as to whether the distinction between legal advice and litigation privilege is really appropriate. 


Challenging Mental Capacity – a High Hurdle
Thursday 8th December 2016

In the recent case of Poole v Everall [2016[ EWHC 2021 (Ch) the Court has demonstrated just how difficult it can be to evidence that a will was not validly executed because the testator did not understand the nature and quality of their actions.

In this case, the testator, Mr Poole, had a history of mental health issues. During his life he was cared for by Mr Everall.

In December 2012 Mr Poole executed a will which left 95% of his estate to Mr Everall.

Previously in February 2012 Mr Poole gave instructions to prepare a will that left nothing to Mr Everall and his solicitor recorded instructions from Mr Poole that he felt bullied by Mr Everall. That will was never signed but was amended in draft to reflect Mr Poole’s later instruction to his solicitors to reflect a legacy of 5% of Mr Pool’s estate to Mr Everall. 

Following his death in April 2013 Mr Poole’s 2 brothers challenged the December 2012 will for a variety of reasons including that Mr Poole lacked capacity to execute that will.

The Court concluded that Mr Poole was suggestible and vulnerable.  However, Mr Poole had been formally assessed by his solicitor and his doctor in February 2012 and both believed he had capacity to give instructions to prepare a will and to understand the effect of executing it.

In circumstances where there has been a contemporaneous professional assessment of the testator concluding that they do have capacity the threshold to be satisfied to successfully challenge a will for that reason is very high.


Coming to a city near you? The hidden cost for employers who provide workplace parking
Thursday 24th November 2016


The Workplace Parking Levy is a charge on employers who provide workplace parking. Nottingham is the only city to have implemented the Levy which collected £9.3 million for 2015/16, £9.1 million in 2015, £8.4 million in 2014 and £7.8 million in 2013. Other local authorities have rejected proposals to introduce their own levies, fearing criticism from local businesses or discouraging future investment. Cambridgeshire and Oxfordshire County Councils are currently considering implementing a levy similar to that in Nottingham. The money generated by the scheme in Nottingham is being used to fund the public transport network.

The law and to whom it applies

In Nottingham, the Levy is given effect by:

  • Sections.178-200 Transport Act 2000
  • The City of Nottingham Workplace Parking Levy Order 2008
  • The Workplace Parking Levy (England) Regulations 2009 (SI 2009/2085)

It is employers, as opposed to employees, who are responsible for paying the Levy, however, with the requisite knowledge and planning, employers can reclaim part of the charge from their employees. All employers or associated employers (subsidiary and parent companies) who provide workplace parking places to; employees, regular business visitors, students or pupils are legally obliged to consider the need to obtain licences for workplace parking places and may be liable to pay.

There are several exemptions to the Levy pursuant to the legislation. However, in terms of employee parking, in the most part, the employer will be obliged to pay the charge. Employers who provide parking to 10 or fewer employees are required to obtain licences, but receive a 100% discount.

The cost

This is potentially substantial.

In Nottingham, for the licensing period of 1 April 2016 to 31 March 2017, the charge is £379 per place, per year. VAT is not payable on the Levy however, if the employer introduces parking charges for its employees to pass on this cost, this would be subject to VAT. Another alternative is to introduce a salary sacrifice scheme. This allows an employee to sacrifice part of their salary for a tax exempt benefit in the form of workplace parking. This would save the employee tax and NIC.

Penalties and enforcement

There are 3 possible civil contraventions:

  1. Failure to have a licence.
  2. Failure to have a licence for all workplace parking places being provided.
  3. Breach of licence conditions. 

If an employer commits one of the contraventions above, they will be notified by the local authority and given a chance to remedy this. Continued non-compliance can result in Penalty Charge Notices. For contraventions 1 and 2, the Penalty Charge will be 50% of the annual charge per unlicensed parking space for each day contravention occurs. If unpaid, the local authority could commence County Court proceedings.

Whilst not yet imposed outside of Nottingham, the number of cities utilising the Levy is likely to increase.