Tuesday, 18 January 2011

Chilling effect of CFAs contrary to article 10

You may recall that it was Naomi Campbell suing the Daily Mirror which resulted in a new cause of action of 'breach of privacy' based on Article 8 ECHR being introduced into English Law.  After pursing the matter to the House of Lords Naomi obtained, in 2004,  the grand sum of £3,500 in damages.

Her solicitors (Schillings) then claimed costs of £1,086, 295.47.  In other words damages were 0.3% of costs.   One reason for this astonishing amount was that her lawyers' acted on a CFA in the House of Lords - meaning that they charged around £280,000 in fees and a 100% uplift on top.  

This has all wound up in the European Court of Human Rights where the Mirror Group has claimed that the recovery of the success fee against them is contrary to their Newspaper's article 10 right to freedom of expression.  

Interestingly enough the European Court of Human Rights has today agreed with the Mirror:

In such circumstances, the Court considers that the requirement that the applicant pay success fees to the claimant was disproportionate having regard to the legitimate aims sought to be achieved and exceeded even the broad margin of appreciation accorded to the Government in such matters.
..... Accordingly, the Court finds that there has been a violation of Article 10 of the Convention.

Basically CFAs and success fess cannot be a justified interference with article 10 because they are not confined to cases where impecunious claimants would not otherwise have access to justice.  Indeed Campbell herself was hardly impecunious.

The Court's conclusion is hardly surprising given that the Government is seeking to reform the funding of defamation proceedings for the reasons identified by the Court-  see review here

The only fly in the ointment for the Government is that the Mirror is asking the European Court to order the UK Government to pay it the success fee (circa £300k) in compensation .  The Court is to consider that at a later date - shame that the UK taxpayer may refund the fees of Messrs Schillings, which they, of course, will keep.......