In February 2001, the publisher of the Daily Mirror newspaper (\u2018MGN\u2019) was sued by Naomi Campbell for breach of confidence and misuse of private information. At first instance, Ms Campbell was successful. The Court of Appeal overturned the decision in 2004 and subsequently, the House of Lords (as it then was) reinstated the first instance decision and Ms Campbell was awarded \u00a33,500 in damages.<\/p>\n
MGN was ordered to pay Miss Campbell\u2019s costs of the litigation, in the sum of just over \u00a31 million. \u00a3600,000 of this sum related to the House of Lords Appeal in which solicitors and counsel acting for Ms Campbell had acted on a CFA with a success fee.
\nMGN appealed to the House of Lords (the \u2018Costs Appeal\u2019) on the basis that it should not be liable to pay the success fee due to the huge disparity between the amount awarded in damages and the level of Ms Campbell\u2019s costs. MGN argued that the disparity constituted an infringement of its right to freedom of expression under Article 10 of the European Convention on Human Rights (\u201cArticle 10\u201d).<\/p>\n
MGN was unsuccessful in the Costs Appeal, which was conducted by Ms Campbell\u2019s solicitors on a CFA with a 95% success fee. The House of Lords found that the existing CFA regime, with success fees, was compatible with Article 10, even when used by wealthy litigants. MGN was ordered to pay the costs of the Cost Appeal, which were in the region of \u00a3250,000.
\nOn 18 January 2011, the European Court of Human Rights (\u201cECHR\u201d) found that the requirement that MGN bear the cost of the success fee was disproportionate and a violation of Article 10. MGN\u2019s total costs liabilities were subsequently settled for \u00a3500,000.<\/p>\n
Four \u201cflaws\u201d in CFAs were particularly noted by the ECHR:
\n1) The lack of a qualifying requirement for claimants entering into a CFA, so that CFAs can be used by wealthy individuals who are able to pay legal fees;
\n2) That there is no incentive on the claimant to control costs under a CFA;
\n3) Than an opposing party would often be \u201cheld to ransom\u201d for early settlement due to the excessive costs burden being put on them;
\n4) That cases funded by CFAs could be \u201ccherry picked\u201d on the basis of their chances of success, which the ECHR considered indicated that recoverable success fees did not achieve the intended objective of providing access to justice to all.<\/p>\n
Paying parties in non-defamation\/privacy cases will want the principles in this case expanded to all civil cases. However this may prove to be difficult in cases not concerning Article 10, especially if the shield of Article 6 (Right to a fair trial) is used by CFA funded claimants.<\/p>\n
The recoverability of CFA success fees was already under attack before the ECHR\u2019s decision in Campbell \u2013v- MGN<\/em>. However, this decision may hasten the abolition of recoverability which was recommended by Lord Justice Jackson in his review of civil litigation costs. Solicitors will now need to consider alternative ways to fund claims on a basis that Claimants can afford.<\/p>\n","protected":false},"excerpt":{"rendered":" In February 2001, the publisher of the Daily Mirror newspaper (\u2018MGN\u2019) was sued by Naomi Campbell for breach of confidence […]<\/p>\n","protected":false},"author":12,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[3],"tags":[36,37,5,19,35],"class_list":["post-50","post","type-post","status-publish","format-standard","hentry","category-news","tag-conditional-fee-agreement","tag-naomi-campbell","tag-professional-negligence","tag-insurance","tag-cfa"],"acf":[],"yoast_head":"\n