legal research paper series - SSRN papers

14 downloads 0 Views 4MB Size Report
litigation costs in England and Wales. The review was .... the spread of litigation funding by third party private investors driven by commercial considerations.
LEGAL RESEARCH PAPER SERIES Paper No 55/2009

December 2009

Costs and Funding of Civil Litigation: A Comparative Study

CHRISTOPHER HODGES, STEFAN VOGENAUER AND MAGDALENA TULIBACKA

This paper can be downloaded without charge from the Social Science Research Network electronic library at: http://ssrn.com/abstract= 1511714 An index to the working papers in the University of Oxford Legal Research Paper Series is located at:

Electronic copy available at: http://ssrn.com/abstract=1511714

Costs and Funding of Civil Litigation: a Comparative Study December 2009

CHRISTOPHER HODGES, STEFAN VOGENAUER AND MAGDALENA TULIBACKA

1 Electronic copy available at: http://ssrn.com/abstract=1511714

CONTENTS Page I

INTRODUCTION

3

II

SUMMARY OF FINDINGS

5

III

RESULTS

IV

A. Background and Methodology

7

B. Costs i. ii. iii. iv.

Introduction General Results Case Studies Cost shifting

10 11 15 19

C. Funding i. ii. iii. iv.

Introduction General Results Legal Expenses Insurance Issues with Third Party Funders

24 25 30 30

DISCUSSION AND CONCLUSIONS i. ii. iii. iv. v. vi.

Court Costs Lawyers’ Costs Cost Shifting Costs and the Architecture of Civil Procedure Settlement Considerations Delivering Predictable and Proportionate Costs

33 34 39 39 42 43

Appendices I. Questionnaire II. Contributors to the Comparative Study III. Ranges of Lawyers’ Hourly Rates IV. Case Studies: Minimum costs risk for claimant V. Summaries of amounts of Court Fees and Lawyers’ Fees VI. Success and Contingency Fees VII. Abbreviations

49 53 55 58 73 81 83

Case study charts

84

2 Electronic copy available at: http://ssrn.com/abstract=1511714

Costs and Funding of Civil Litigation: a Comparative Study November 2009

CHRISTOPHER HODGES, STEFAN VOGENAUER AND MAGDALENA TULIBACKA 1 I. INTRODUCTION This Report is based on a comparative study that was carried out by the Centre for SocioLegal Studies and the Institute of European and Comparative Law at the University of Oxford. It summarises the approach to costs and funding of civil litigation in the 34 jurisdictions for which we currently have data. 2 We are continuing to collect data from further jurisdictions. We publish this Report although our findings are necessarily tentative at this stage. The reason for making them available online now is the ongoing fundamental review of civil litigation costs in England and Wales. The review was initiated by the Master of the Rolls, Sir Anthony Clarke, 3 who appointed Lord Justice Jackson to conduct an enquiry with a view to making recommendations in order to promote access to justice at proportionate cost. The review commenced in January 2009, and its findings are due to be presented in December 2009. Lord Justice Jackson published a Preliminary Report in May 2009. 4 He will be writing his final report in the second half of this year, and we hope that this Report can help to inform his enquiry. Our final results will be published in book form. Apart from an updated and extended version of this paper, the book will contain national reports on the costs and funding regimes of some twenty jurisdictions. 5 We are extremely grateful to the large number of scholars and legal practitioners who have kindly provided input to this project, primarily as answers to our questionnaire (Appendix 1). They have all responded within very tight time schedules. They are listed 1

Respectively: Head of the CMS Research Programme on Civil Justice Systems, Centre for Socio-Legal Studies, University of Oxford; Professor of Comparative Law and Director of the Institute of European and Comparative Law, University of Oxford; Senior Lecturer, University of Westminster and Associate Research Fellow, Centre for Socio-Legal Studies, University of Oxford. We are very grateful for comments on a draft by Professor Stephen Burbank and Professor Deborah Hensler, and from attendees at a conference in Oxford on 6 and 7 July 2009. 2 The jurisdictions are Australia, Austria, Belgium, Bulgaria, Canada, China, Czech Republic, Denmark, England and Wales, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, Ireland, Italy, Japan, Latvia, Lithuania, the Netherlands, Norway, Poland, Portugal, Romania, Russia, Scotland, Singapore, Spain, Sweden, Switzerland, Taiwan, USA. 3 Now Lord Clarke of Stone-cum-Ebony. 4 Lord Justice Jackson, Review of Civil Litigation Costs: Preliminary Report (London, HMSO, 2009), available at http://www.judiciary.gov.uk/about_judiciary/cost-review/preliminary-report.htm. 5 C Hodges, S Vogenauer and M Tulibacka (eds), Costs and Funding of Civil Litigation (Oxford, Hart Publishing, in preparation).

3

in Appendix 2. We are also most grateful to Francis Denning, a doctoral candidate in the Economics Department of the University of Oxford, for sterling work on analysing the data and creating the bar charts. This Report is in two main parts. The first of these parts (III. below) introduces and summarises the preliminary findings of the study. The second of these parts (IV. below) comprises the overview comments and conclusions of the three editors. We preface the Report with a summary of its findings (II. below). A list of abbreviations can be found in Appendix VII to this paper.

4

II. SUMMARY OF FINDINGS The general conclusions of this study are as follows: 1. The amount payable by litigants in legal costs is frequently high and disproportionate to the value of the claim. 2. The level of litigation costs is related to the amount of work done by the nonparty actors in the litigation process, notably lawyers, judges and experts. Common law and civil law jurisdictions have distinct architectural features of civil procedure, which give rise to different roles for lawyers and judges, and hence typically to significantly different levels of cost between the two broad traditions. 3. In the civil law tradition, typified by Germany, judges have comparably more work to do than judges in common law jurisdictions, and lawyers have a greater share of the workload in the common law tradition than in that of the civil law. Hence the balance between court fees and lawyers’ costs is, as a general proposition, different between the two traditions. Thus, the percentage of total costs attributable to court fees is higher in most civil law jurisdictions, whereas lawyers’ costs are usually clearly the higher element in common law systems. 4. Most civil law systems (notably except France) tend to shift costs to the loser on the basis of a tariff based on the amount in dispute. This provides ex ante regulation of the level of costs and a high level of predictability for all parties to litigation. The predictability also facilitates the provision of legal expenses insurance (LEI), and LEI is often widespread in such of those states that are in Western Europe (it has yet to develop within the emerging new legal systems of Central and Eastern Europe). 5. In common law jurisdictions, the major element of litigation costs is lawyers’ fees. In those jurisdictions (except the United States of America, which has a distinctive system) the usual factor in such costs is the time spent on a case. In larger cases, the fees can be extremely high. In smaller cases the level of fees can be disproportionate to the sums at stake. 6. Few jurisdictions have historically applied a principle of proportionality to litigation costs, or to lawyers’ costs, but such an approach is now spreading. The importance of proportionality of litigation costs has also become particularly relevant where lawyers’ costs have become too high. There is a need for wider debate over what it is that costs should be proportionate to (the amount of work done, the value of the case to the party, or the amount at stake), and how proportionality should be applied. 7. Market forces are seeking alternatives to high litigation costs. Dispute resolution mechanisms are appearing that are outside the courts, do not involve lawyers, or

5

involve lawyers less. Examples include ombudsmen, tribunals and alternative dispute resolution techniques. Within the courts, special techniques are being created, such as procedure-light tracks (e.g. small claims or pre-action protocols), encouraging mediation, or adopting fixed cost regimes. There is evidence of continuing experimentation with a range of techniques, and diversification is far from complete. 8. Most jurisdictions apply a ‘loser pays’ rule, although the amount of costs shifted to the loser deliberately rarely gives a complete indemnity so as to encourage avoidance of litigation and earlier settlement. In contrast, the legal system in the United States of America has a distinct architecture that does not include cost shifting, save where one way cost shifting has been expressly provided by Congress under a range of statutes that encourage private enforcement. 9. In many jurisdictions, lawyers’ fees do not operate on normal market principles where individual claimants are involved. Market behaviour applies in setting the level of legal costs essentially only for large repeat players such as insurance companies and major corporations. There is an inherent conflict in civil procedure between providing a just result and providing a result at proportionate cost. Resolving this conflict involves a level of compromise over the extent of access to appropriate evidence. Shifting costs on a tariff basis provides predictability, albeit not necessarily proportionality. Our observations on the current position include the following. The high level of lawyers’ costs, and the procedural architecture in some systems, produce significant challenges for delivery of access to justice at proportionate cost. Governments are set to impose significant cuts in public expenditure as a consequence of the financial environment, and civil justice is not a high priority for spending. Governments, businesses and citizens will be looking for cheaper and quicker dispute resolution pathways. Those responsible for courts, including judges and lawyers, will need to respond by lowering costs, simplifying unnecessary procedures, increasing predictability of costs, and delivering speedy services at costs that are proportionate to amounts in dispute. New approaches to funding litigation are emerging. Legal aid is likely to remain largely unsustainable as a public expenditure item. Private funding solutions include permitting lawyers to fund cases in some jurisdictions (opposition to contingency fees has crumbled in some jurisdictions but remains strong in many), and permitting the spread of litigation funding by third party private investors driven by commercial considerations. There is a need to examine and debate the options, and to introduce consistent and effective regulation so as to avoid client detriment. An important aspect to be resolved is the extent to which any funder should control or influence strategic decisions in the litigation of others.

6

III. RESULTS OF THE STUDY

A. Background and Methodology 1. Costs and funding have been forgotten areas of civil procedure. The focus has traditionally been on the ‘front end’ of procedure design, often based on certain doctrinal principles, rather than on empirically evaluating how well the system works, by looking at the ‘back end’ of outcomes. But not any more – systems are being evaluated against criteria of speed, cost, efficiency and appropriateness of the pathway for the type of case. 2. As a consequence, whilst costs and funding have traditionally received relatively little attention by academic writers in general, and by comparative lawyers in particular, 6 there has recently been stronger interest in these subjects. 3. The European Commission for the Efficiency of Justice (CEPEJ), an initiative of the Member States of the Council of Europe published reports in 2006 and 2008. 7 Those reports contain data for the evaluation of judicial systems in Europe, with a focus on judicial and quasi-judicial institutions and their funding. They also include some information on court fees and legal aid. 4. The European Commission commissioned a large comparative study of litigation costs as part of its policy of building a European space of freedom, security and justice. The study was carried out by a Brussels based law firm, and its findings were published in 2007. 8 It found great variations in the costs and funding regimes of the Member States of the European Union. 5. Since 2006, the ‘Measuring Access to Justice Project’, a joint initiative of The Hague Institute for the Internationalisation of Law, Tilburg University and Utrecht University, has published a number of studies. Their common goal is to develop, validate and disseminate a standard methodology for measuring the costs and quality that users of justice may expect. 9 As a part of the project, a detailed analysis of litigation costs in the Netherlands, Bulgaria and Bolivia was undertaken. Its 6

For an exception, see A Paterson, ‘Financing Legal Services: a Comparative Perspective’ in DL Carey Miller and PR Beaumont (eds), The Option of Litigating in Europe (London, United Kingdom National Committee of Comparative Law, 1993) 149. There is also a huge body of national writings on legal aid. Brief overviews of national costs regimes can also be found in A Layton and H Mercer (eds), European Civil Practice vol 2, 2nd edn (London, Sweet & Maxwell, 2004). 7 European Commission for the Efficiency of Justice (CEPEJ), European Judicial Systems: Edition 2006 (data 2004) and European Judicial Systems: Edition 2008 (2006 data) – Efficiency and Quality of Justice, (Strasbourg, Council of Europe, 2008), available at www.coe.int/T/dghl/cooperation/cepej/default_en.asp. See also P Albers, ‘Judicial Systems in Europe Compared’ in CH van Rhee and Uzelac (eds), Civil Justice between Efficiency and Quality: from Ius Commune to the CEPEJ (Antwerp, Intersentia, 2008), 9. 8 J Albert, Study on the Transparency of Costs of Civil Judicial Proceedings in the European Union: Final Report (Brussels; Hoche, Demolin, Brulard, Barthélémy; 2007), available at http://ec.europa.eu/justice_home/doc_centre/civil/studies/doc_civil_studies_en.htm. 9 www.measuringaccesstojustice.com/index.php/Publications.

7

methodology includes not just the easily quantifiable costs but also aspects of time, delay, psychological and business cost. From the perspective of users, these ‘costs’ may be significant. 6. In 2008, the Oxford Civil Justice Survey examined to what extent businesses in Europe were influenced by their perceptions of national civil justice systems and contract laws when choosing the applicable law and the forum of litigation for crossborder transactions. It emerged that the perception of costs was one of the important factors that influenced such choices, albeit slightly less important than might have been expected. 10 7. ‘Cost and fee allocation rules’ in civil procedure is also one of the topics on the agenda of the 18th International Congress of Comparative Law that will be held in Washington in July 2010. 8. This study on the costs and funding of civil litigation is part of the EU Civil Justice Project, which is a new pan-European academic initiative to research dispute resolution issues – whether using courts or alternative procedures and techniques – and build up an evidence-basis to support policy decisions on best practice in dispute resolution for the 21st century. 11 9. The study was conducted by two of the Centres of the Faculty of Law of the University of Oxford. Dr Christopher Hodges of the Centre for Socio-Legal Studies and Professor Stefan Vogenauer of the Institute of European and Comparative Law devised a questionnaire. The questionnaire is reproduced in Appendix I to this paper. Respondents were first asked to answer a number of questions on costs and funding of civil litigation in their jurisdiction in general. In addition, the questionnaire contained nine case studies. We asked each practitioner respondent to estimate the costs that the parties in these hypothetical cases would incur had they been litigated in his or her jurisdiction. 10. At this stage, we aimed to include as many jurisdictions in our study as possible. Obviously we needed data from the major legal systems from the common law and the civil law tradition. But we also thought it would be helpful to look at other jurisdictions which might be expected to have experienced distinct historical challenges and might have developed innovative approaches to meet them. We therefore included, inter alia, jurisdictions from East Asia, Central and Eastern Europe and Scandinavia. All in all, we sent the questionnaire to 36 jurisdictions. 11. Given that questions of cost and funding have so far attracted relatively little academic attention in most legal systems, we expected to receive a more enthusiastic 10

S Vogenauer, ‘Perceptions of Civil Justice Systems in Europe and their Implications for Choice of Forum and Choice of Contract Law: an Empirical Analysis’ in S Vogenauer and C Hodges (eds), Civil Justice Systems in Europe: Implications for Choice of Forum and Choice of Contract Law (Oxford, Hart Publishing, forthcoming) ch 1. 11 See summary at http://www.csls.ox.ac.uk/european_civil_justice_systems.php.

8

response and more reliable results from legal practitioners, rather than from academics. Accordingly the questionnaire was first sent to a practicing lawyer in each jurisdiction. Many of these lawyers were identified through previous work with Dr Hodges. The questionnaires were circulated on 15 January 2009. 12. The 32 practitioner reports that we have received so far are available on a project website. 12 They have not been edited, and some of them are supported by further materials, such as legislative sources and statistics. 13. Once we had received the response of a practitioner we asked a legal scholar from the same jurisdiction to review it and to contribute further comments. So far, we have received 15 of these academic reports. They are also available online, again in their original and unedited versions. 13 14. The names and affiliations of the national practitioners and academics who assisted with this study are listed in Appendix II to this paper. We are extremely grateful to them. All of them gave their time free. The facts set out in this Report are drawn from the national reports save where otherwise stated, but we have generally refrained from citing the national reports below, since this would be endlessly repetitive. Considerable detailed work on analyzing the case studies was undertaken by Dr Magdalena Tulibacka and Francis Denning. 15. Some of the academic reporters presented their findings at a conference held in Oxford on 6 and 7 July 2009. Other speakers at the conference included Lord Justice Jackson who presented his Preliminary Report 14 and representatives of the European Commission, the Dutch Government, CEPEJ, a commercial litigation funder and business as well as consumer interest groups. 15 We are most grateful to international law firm CMS EEIG for its generous funding of the conference. 16. This Report attempts a synthesis of the national practitioner reports, the national academic reports and the information we were able to gather at the Oxford conference. Whilst we had to rely on the accuracy on the information that we received from our national reporters, the conclusions and the policy recommendations are our responsibility alone. Our conclusions and recommendations will not necessarily reflect the views of those who provided us with information on their systems. Nor are they to be taken to represent the views of CMS EEIG or indeed of any of the funders supporting the Oxford Centre for Socio-Legal Studies 16 and the Oxford Institute of European and Comparative Law 17 in general. Our conclusions have been reached in complete independence. 12

www.csls.ox.ac.uk/COSTOFLITIGATIONDOCUMENTSANDREPORTS.php. ibid. 14 See n 4 above. 15 The programme of the conference and a summary of the discussion is available at www.csls.ox.ac.uk/COSTSOFLITIGATIONDOCUMENTSANDREPORTS.PHP. 16 CMS EEIG and the European Justice Forum. 17 A variety of national governments and foundations, as well as international law firms, particularly Clifford Chance LLP (for further information, see http://denning.law.ox.ac.uk/iecl/supporters.shtml). 13

9

17. Before presenting our findings we have to stress their preliminary nature once again. Maybe we will have to revise some of them in the light of further evidence or in order to take account of comments of our national reporters which we will solicit once this Report will have gone online. Having said this, we are optimistic that our collection of data is sufficiently large and reliable to support a number of important conclusions on matters of some significance to civil justice systems.

B. Costs (i) Introduction 18. Several jurisdictions have given particular attention during the past decade to reforming civil procedure rules so as to reduce delays and costs. In England and Wales, for example, the influential Woolf reforms that resulted in the Civil Procedure Rules (CPR) 1999 brought about significant changes in culture, but are widely thought not to have solved costs issues. A principal reason for a lack of stability arose not with the procedural rules but with the systems for funding litigation, and the fact that they changed at the same time as the procedural rules. The ongoing Review of Civil Litigation Costs being undertaken by Lord Justice Jackson seeks solutions to these costs problems, possibly through reforms in costs rules and also through approaching different types of case/pathway differently. 19. Various other jurisdictions have been reforming their rules on costs. Notable recent examples are Belgium (2002) and Portugal (2008). In 2002 Belgium changed its French-inspired no cost shifting rule and introduced a loser pays approach for lawyers’ fees. 20. Why do costs matter? From the claimant’s perspective, the size and predictability of the costs of a dispute resolution process need to be evaluated to see whether the risks and benefits of using the process to pursue an action. If the costs or risk are too high, and there is no better alternative pathway, the result will be a denial of access to justice, and wrongs will not be remedied or compensated. Further, the extent of any shortfall in the recoverability of costs raises similar issues. From the defendant’s perspective, similar risk-benefit calculations arise in relation to the decision to defend or admit a claim, influenced by the relative merits of a claim or defence. From the state’s perspective, there needs to be a balance between making justice sufficiently accessible, in order to maintain the rule of law and a stable society and economy, whilst arranging that the public cost of providing the civil justice system is covered, from some combination of general public funds and/or of payments by individual litigants. The costs rules provide a number of incentives or barriers to litigating parties, in relation to bringing, defending, settling or fighting disputes. Such rules also indicate priorities as between different judicial or alternative dispute resolution pathways, or between the dispute resolution systems available in different

10

jurisdictions. In this last respect, costs regimes are topical because they indicate the level of comparative efficiency between different court systems, and whether these systems involve procedures that are too costly or too slow. Lastly, from the perspective of lawyers or other intermediaries, such as experts, bailiffs or witnesses, the costs rules govern the amount of remuneration that can be earned, and this will affect the quality and quantum of supply of such services.

(ii) General Results 21. Every jurisdiction has rules that regulate the economic consequences of litigation, i.e. rules on costs. 22. The basic elements that make up quantifiable costs (in economic terms, the cost centres) are the same in every jurisdiction: a. Charges for use of the courts, including associated officers, bailiffs; b. Evidential costs: witnesses, experts; c. Lawyers’ fees, where lawyers are involved, including the cost of obtaining documentary evidence in common law jurisdictions. 23. Few jurisdictions seem to have formally codified the principles on which their rules on costs are based. An exception is Portugal, which has provided in its 2008 reforms the principles that legal costs finance the legal system, guarantee access to the law, and discourage frivolous or excessive claims and dilatory judicial practices. In addition, Portugal applies the principles of victus victori, causality, procedural advantage or benefit and proportionality. 24. Similarly, very few jurisdictions seem to have adopted a policy principle that costs should be proportionate. The rules arguably deliver that result in some jurisdictions, but England and Wales is the leading example of where an explicit policy has been adopted, 18 followed recently by Canada. The Portuguese Constitution includes principles of proportionality and access to justice. 19 Proportionality is a fundamental constitutional principle in relation to action by the European Union and Member States, 20 although it does not apply under EU law in relation to private contracts, such as agreements with lawyers. However recent it may be as a concept, the principle of proportionality may have strong influence on future developments in EU legal systems. 25. Court charges. Almost every country levies a charge on litigants for use of the state’s courts. Only France and Sweden 21 impose (almost) no charge as a matter of 18

CPR, Part 1.1(2)(c). Article 20(1) of the Portuguese Constitution. 20 Article 5(3) EC Treaty. 21 In Sweden the state spends some SEK 4.3 billion on courts annually, and parties pay some SEK 47 million (1% of the total) on applications. 19

11

principle. All the other governments levy a charge in order to contribute to the expenses that fall on the public purse of maintaining a state court system. 26. Few statements seem to be made about whether the charges levied are intended to cover all or some of the state’s costs. Indeed, there is a suspicion that the fees charged by courts are often selected on an arbitrary basis and that many courts’ administrations are not transparent in relation to their actual costs. It is unclear to what extent governments actually compute what the costs are. The United Kingdom adopts a principle of full costs recovery, although it in fact only recovers around 80 per cent of the budget through fees, with the remaining 20 per cent coming from Treasury funds. 22 27. Two broad approaches might be adopted towards charging for court costs: a single fee at the start or a series of different fees applying to a sequence of procedural steps. The former approach is simple and transparent. Some jurisdictions refund part of the court charges if the case settles before the end of the formal process. 23 This is intended to encourage settlement. The latter approach, involving staged charges, also theoretically encourages settlement, but in practice the incentive would be limited where, as is usually the case, the sums involved are low. 28. Some systems introduce complexity through costs for different actors for service of process (which might be by public or private officials or bailiffs) and for enforcement of judgments (which might again be by private or public bailiffs). Other systems place the burden and cost of service and enforcement on the party personally. The latter solution saves public funds but increases personal costs. The former solution increases complexity but might be cheaper and more effective where carried out by a public official. 29. Court fees frequently include a tapering element: they may be related to the amount in dispute (where that is computable), whether on the basis of a percentage levy or incremental steps, but the percentage reduces for higher value claims, or is capped so as not to give rise to astronomical fees for very large cases. 30. In 2008 Portugal, having discovered that about half its cases related to small debt claims, attempted to drive cases out of the courts by increasing court fees for those who bring over 200 cases, but the approach has been highly controversial. 31. There are indications from various jurisdictions that claimants adopt various strategies to avoid paying higher court costs than necessary (or increased liability for lawyers’ fees). Thus, claimants might limit the issues in dispute, or the amounts 22

See the HM Courts Service website (http://www.hmcourtsservice.gov.uk/infoabout/fees/index.htm) and Jackson (n 4 above), ch 7. 23 Under the 2008 reforms in Portugal, 50% of the court fee is refunded if the case settles before the end of the court process. In Taiwan, as part of a specific policy of encouraging settlement and use of mediation, two-thirds of the court fees paid may be refunded when the claimant voluntarily dismisses the action prior to termination of the first oral session at first instance, when a settlement is reached, or where there was a successful mediation

12

claimed, or bring a test case. jurisdictions and Taiwan.

Examples include many continental European

32. Although outside the scope of this study, there are some indications of a trend that governments and courts are seeking to reduce costs by creating specialist courts and tribunals, which should be more efficient and possibly reduce the extent of factual or expert input. 24 33. Systems in which judges and courts are required to do significant amounts of work can lead to high court fees. The court fee tariff is considered high in Germany, and capped at a standard filing fee of €274,368 for any claim over €30 million. 25 34. Witnesses. Every jurisdiction provides for reimbursement to witnesses of their costs of travel and other reasonable costs in giving evidence. Some systems also permit witnesses’ time to be recompensed in some way. Central European states tend to reimburse employees or employers, but the sums paid for time are low: the award in Belgium is usually a total sum of €5! Witness costs are not a major cost centre within litigation. 35. Experts. There are two differing architectural designs in the family of civil procedures in relation to the way in which expert evidence is obtained. The general civil law approach is that the court will appoint an expert (usually one). Persons appointed have a somewhat judicial function through being independent of the parties and resolving technical issues by way of answering the court’s questions on particular issues. Such experts may, in many but not all jurisdictions, be university professors or other civil servants. In general, the party who requests such an expert must put up funds that will be used to pay the expert. 26 National systems of this type differ on whether such experts’ fees are to be on an official scale, or are fixed through market forces or free negotiation with the court, but the amounts are almost always, in this system, approved by the court and the court transfers the money to the experts. The costs of such court-appointed experts will usually be payable or reimbursable by a losing opponent at the end of the case. In addition to such court-appointed experts, it may be possible in some (not all) civil law jurisdictions for parties to appoint and pay their own private experts, whose evidence might, or might not, be admissible in court, or influential on the court-appointed expert. Such costs for private experts are rarely reimbursable. 27

24

The United Kingdom has a matrix of specialist courts and tribunals. For the reasons given, Taiwan has introduced an Intellectual Property Court and is considering the introduction of a construction court. 25 The recoverable lawyer’s fee is similarly capped at €228,740 plus 19% VAT: see below. 26 Belgium reformed its approach in 2007 after dissatisfaction over delays in obtaining judicial expert opinions, and following concern that the former system under which requesting parties paid experts direct led to perceptions of conflict of interest or bias on the part of the expert. 27 Belgium changed the rule on this in 2007, and made the costs of extra-judicial experts to be theoretically claimable, although this is expected to occur rarely. The 2004 Supreme Court case that sparked this reform illustrated a need for expert advice on quantification of the claim, and that was viewed as an essential consequence of the tort concerned.

13

36. In contrast, in the common law jurisdictions, the traditional approach is that each party has to select and pay his own expert, whose evidence will be produced to the court. The rates are fixed by negotiation and market forces, rarely with any formal tariff (although some professional association tariffs might have influence). The costs would be reimbursed to a winning party if a loser pays rule applies in the jurisdiction, but the court would have power to review such amounts and reduce them if unreasonable. 37. Lawyers’ fees almost always represent the largest element of total litigation costs. Fees payable by clients may sometimes be based on a tariff established by law, but no such tariffs appear to be bindingly exclusive: lawyers in Germany, for example, may decide to charge the tariff sum or charge on some other basis, and the state of the market is such that a lawyer who will be prepared to work on the tariff basis can currently always be found. 38. Appendix III gives the ranges of hourly rates quoted by national correspondents for their countries. All of this data needs further verification, and other sources indicate a number of potential inaccuracies. However, it is clear that there is currently a wide variation in the hourly rates that lawyers charge, across countries and often within countries. Many of the higher rates apply to commercial work undertaken for large corporations, which are repeat players and have some sophistication, understanding of the market and commercial leverage over rates and quantity of work done. 39. Economic and regulatory theory indicates that an essential feature of a properly functioning market is transparent information. Many jurisdictions have a requirement for lawyers to give information to clients on fees, whether by law or under professional codes. We did not expressly seek information on this aspect, but examples include Australia, England and Wales, and Denmark. In Japan an estimate of fees must only be given on request. But in many jurisdictions the required information is often on rates, not on predictions of work done, and therefore, importantly, not on estimates of the cost of their own lawyer and the size of the risk (Ireland requires a reasonable estimate of both sides’ costs at the start). 40. Does a mere requirement for lawyers to provide information on fees or (better) total costs provide sufficient control over fees or costs? The theory is that market forces apply, but economists have pointed out that a proper market rarely applies in relation to most lawyers’ services to consumers. Individual consumers do not have the expertise or commercial leverage or sophistication to differentiate between the quality or costs of different providers, or to negotiate lower or capped fees. Where this occurs, the issue is one of market capture by lawyers. However, in some societies, consumers’ resources may be limited, such that the lawyer may respond by having to restrict the amount of work done: the national correspondent in Japan pointed out that a client might tell the lawyer at the start how much money he had available to spend on a case and the lawyer would work within this budget, for example by deciding not to pursue certain witnesses or expert evidence if the cost would exceed the budget.

14

41. In contrast, where clients are sophisticated and/or repeat players, negotiations may occur on a normal market basis. This should apply where clients are larger companies and insurance companies. Market forces operate more clearly in such circumstances (the report from the Netherlands noted that insurance companies had forced fixed rates on their lawyers, and this is anecdotally repeated widely elsewhere). For example, bargaining can be identified based on commoditisation, where lower rates will be negotiated in return for a volume of cases, especially where the cases are similar in type and involve similar and predictable amounts of work. An example of this arises widely with road traffic accident (RTA) cases handled by legal expenses insurance (LEI) insurers where they are able to select and instruct panels of lawyers, rather than where individual consumers have the right to a lawyer of their own choice. From the consumers’ perspective, therefore, lower insurance prices for simple commoditisable work should occur where insurers are permitted to choose lawyers, and the freedom to chose the consumer’s own lawyer may be a false economy and worth surrendering. 42. Other aspects of lawyers’ costs and how they are funded are dealt with below. 43. A major policy response to increasing costs that is visible in many common law jurisdictions has been the adoption of case management techniques by courts. However, current concern over unpredictable and disproportionate costs represents a failure of the case management policy as it has been applied by the court system. This is a serious challenge to the reputation of courts and judges, and to the ability of a state and society to satisfy citizens’ and businesses’ legitimate expectations of delivery of justice. It is a fundamental threat to the rule of law. But is case management capable, as was thought, of solving the costs problem, since it itself involves cost through requiring work by both lawyers and judges?

(iii) Case Studies 44. In order to be able to make a broad comparison between the costs of litigation in different jurisdictions, examples of cases were selected and sent to practitioner correspondents involved in this study. Since costs can vary significantly between different types of cases, nine exemplar types were selected, to give a range of case types and costs. Typical fact patterns were chosen which, it was assumed, might arise in all jurisdictions concerned, such as a damages claim following a road traffic accident, a divorce, a wrongful dismissal, or larger commercial matters, and including injunctive and damages remedies. The contributing practitioners were asked to give their best estimates of the likely costs in the case studies. 45. There are various aspects in which the data in this study has limitations. First, since civil procedure varies between jurisdictions, the case examples were described in broad terms, so as to avoid assumptions about the extent of work that would be necessary for final resolution of each case. This result inherently required national practitioner respondents to make a number of assumptions about a case, such as the

15

extent of pleading, oral and documentary evidence, expertise, duration, amount and so on that would affect costs. Almost all responses involved some elements that are fixed costs and other elements that are estimates. 46. Further assumptions were required over the amount at stake: the case studies tended to avoid stating many precise figures or details, since the economic value of money or such matters as employment remuneration varies between jurisdictions. In order to reflect such differences, the PPP calculation described below was made. 47. Furthermore, we did not include information on the procedural conduct of the parties, which might again increase or reduce costs. Different legal systems have different responses to such behaviour (eg delaying tactics, calling of experts or offers of settlement). More importantly, the kinds of behaviour that trigger such responses differ from one jurisdiction to another. Had information on procedural behaviour been included, there would have been a risk of distorting the picture. 48. For the above reasons, responses given were often estimates, and ranges. Whenever a ‘bracket’ of costs was given, the lowest amount was incorporated into the comparison tables, so as to reflect the minimum costs exposure for each of the parties. 28 Figures are also given (Appendix V) for median costs as regards lawyers’ fees – in other cases it was not possible to construct a median costs comparison. 49. In some cases the respondents indicated that litigation was not the recommended/popular route of obtaining redress, and in other cases it was expressly stated that litigation is not used as a response to the given legal problems: instead, the respondents suggested administrative or insurance routes. In such cases, no costs of litigation were given. 50. Accordingly, the data should be viewed as preliminary, giving a general impression, and not as precise figures. However, the data should give a general overview and comparison of costs of roughly similar cases in the jurisdictions included in this study, based on the opinions of leading national practitioners. The data enable a comparison not just of overall costs in these case studies, but also specific elements of costs, such as court fees and lawyers’ fees. The methodology, with its faults, does produce data that may be considered to be at least indicative of the costs of civil litigation in a given jurisdiction as compared to other jurisdictions. It also shows, as discussed below, that there are indeed both comparatively cheap and relatively expensive legal systems, and that the results differ from one type of case to another. 51. The general caveat also needs to be noted that in countries where lawyers’ fees are calculated on a per-hour basis it was quite difficult to estimate the costs of a particular case. This was particularly clear in England and Wales; and Ireland is often excluded from the comparative tables whenever such tables include lawyers’ fees. 28

Of course, this costs exposure is mitigated by the application of the loser pays principle, which to some extent is present in most of those states included in this study. The application of the principle has been assessed in the detailed tables of costs for each case study.

16

52. The comparative analysis was initially conducted in local currencies, which were all subsequently converted to Euros (if not already in Euros) (rates as per June/July 2009 (see tables for exact dates)). We also calculated the Purchasing Power Parities (PPP) to reflect the differences in local price levels. This was done for the purpose of mitigating these differences in price levels – essential when comparing values in different currencies – and thus presenting a more realistic comparison of litigation costs. The PPP is calculated according to a formula which takes into account the exchange rates as well as costs of living in the respective countries. The PPP factors for 2009 are based on IMF data. The PPP conversion factors are calculated using these factors (constant values for 2009), and are defined as the number of national currency units per ‘international dollar’ (USD Intl). 53. Remarkably, some practitioners initially replied that it is difficult under their system to predict what the costs, especially lawyers’ costs, would be. Such a response is a powerful indication that costs are not sufficiently predictable in a jurisdiction. Some of the answers that we ultimately received are based on expertise and partial guesswork, rather than transparent predictability. 54. Summaries of the case studies and the answers are set out below in the following separate summaries: ‐ Final minimum costs risk (USD Intl Conversion) – Appendix IV and attached bar charts; ‐ Hourly fees and court fees comparison table – Appendix V. 55. A further set of documents, with the detailed itemisation of costs for each case study and for each respondent country, is available on request from Dr Magdalena Tulibacka ([email protected]). 56. The following findings emerge from this data. 57. Variation in litigation costs. The total costs of litigation vary widely among the jurisdictions included in this study. A frequent pattern is that costs (whether in total, or for court or lawyers’ fees) may have a broadly similar level in the majority of jurisdictions (which some may interpret as being at a ‘low’ level). However, there is usually a minority of around two or four jurisdictions that have costs that are very considerably higher than the average level of the majority. 58. In some cases, respondents indicated that litigation was not the recommended or most popular route for obtaining redress in the given situation, and that alternative administrative or insurance solutions were preferred. In some such cases, no costs of litigation were given. 59. Court fees. In the majority of jurisdictions, court costs are relatively low. The significant outlier is Singapore, which has notably higher court costs than other states for most of the case studies.

17

60. Central and Eastern European states (such as Latvia, Estonia, Poland, Bulgaria, or the Czech Republic) have relatively high court fees proportionate to the value of the case, and proportionate to the level of lawyers’ fees. Hungary is a notable exception to this pattern, having relatively high lawyers’ fees as well as relatively high court fees in many of the case studies. 61. Court costs also for some case studies tend to be high in England, Ireland, the Netherlands and Norway. However, these states often have another ‘preferred dispute resolution route’ for some types of claims. 62. Court fees are generally low in Germany and Austria, as well as Greece. Beyond Europe, they are quite low in Taiwan and China. 63. In a majority of states the court fees are much lower than the lawyers’ fees. In Central and East European countries, however, where lawyers’ fees are already relatively low, court costs constitute a higher percentage of these fees (sometimes they are even higher than the lawyers’ fees). 64. A number of caveats must be noted here: a) Some court fees, as indicated in the responses to case studies, include VAT; while others do not. In some states VAT is not charged on court costs, in others it is. Also, VAT rates differ. Respondents’ reports are not always very precise about which rates do and which do not include VAT, and about the VAT rates. b) In some states (France in particular), court fees are normally nil. In other states (such as England), there has been a tendency to bring the court fees closer to the full cost of litigating the case in court (in most states, however, no such correlation could be drawn directly from legislation of policy instruments). c) Most court fees do not include remuneration for experts, witnesses, and other disbursements – some respondents have indicated these costs if they are separate, others have not. 65. Lawyers’ fees. There are very significant differences in the manner in which lawyers’ fees are regulated, and very often there is a wide scope of discretion as to the exact arrangements between lawyers and clients. In most states lawyers can charge a ‘per hour’ or a ‘per case’ rate, although for cost-shifting purposes the position is more complex. It is extremely rare for all lawyers’ fees to be recoverable by the winning party. 66. Overall there is a clear tendency for lawyers’ fees to be higher than court fees. As mentioned above, however, Central and Eastern European states demonstrate a much more even distribution between lawyers’ fees (which are still relatively low) and court fees.

18

67. The highest lawyers’ fees can be observed in Australia, England and Wales, and Denmark. Germany, Austria and Greece have relatively low lawyers’ fees. 68. Lawyers’ fees are usually subject to VAT. VAT rates vary between countries, and can have significant impact, for existence between no charge and 30 per cent. 69. Appendix V gives a summary of the data on court fees and lawyers’ fees from the case studies. Although every system has court fees and other costs, such as for witnesses and experts, the major portion of litigation costs lies in lawyers’ fees. 70. Costs to case value ratio. The responses to the case studies indicate that in most states included in this study the costs of litigation are high in relation to the value of the case - sometimes they even exceed the value of the case. Here some Western European states (such as Denmark, England and Wales, Ireland) are particularly striking examples, but the problem is also clear in Hungary and some other Central and Eastern European countries. Singapore and Australia clearly have some of the highest costs. China and Taiwan have more proportionate costs. 71. However, in some states, not all cases are expensive or disproportionate. An example of this can be seen from the results for the nine case studies in England & Wales. There, the results for the small claim, divorce, employment, debt and consumer injunction case studies indicate comparatively low costs, whereas those for the road traffic, medical negligence, large commercial dispute and intellectual property injunction case studies are comparatively high. This may reflect the fact that different costs rules, or costs shifting rules, or alternative dispute resolution pathways, are available for some types of claims. Such a finding may indicate that future work on providing particular pathways, procedures and costs regimes for particular types of cases may be fruitful.

(iv) Cost Shifting 72. Every jurisdiction studied has a rule on cost shifting. 73. In almost every jurisdiction, cost shifting (loser pays) is the general rule. The only country in this sample where the general rule is that each side bears its own costs is United States of America. In Japan, cost shifting is the formal rule, but does not happen in practice. In China, the cost shifting rule (or no cost shifting rule) only applies to a limited extent. A small number of countries provide some limited exceptions to a general cost shifting rule for particular types of case, as mentioned in paras 80 and 145 below. 74. Where cost shifting applies, the following costs are shifted: court costs (at cost), witness and expert expenses (usually at cost but subject to court approval), and, in most jurisdictions, lawyers’ fees and expenses (usually subject to reduction). In

19

Spain, costs cannot be awarded against the state, not (as in a number of states) against those supported by legal aid. 75. Almost every jurisdiction has rules on how to deal with the situation where the claimant only succeeds on part of the claim, or the defendant succeeds on part of a defence or counterclaim. The result, overall, is that both sides are partially successful. In general, the outcome that results is that the costs are apportioned between the parties. There are two opposing ways of looking at this apportioned result: either both the claimant and defendant pay some costs, or both are not awarded, or do not recover, all the costs to which they might otherwise have been entitled. In some states, such as Germany, the court states a proportion of the standard tariff costs that each party has to pay, and this results in a straightforward arithmetic calculation. In some jurisdictions, the approach might be less arithmetically based and the court might award a set sum to whichever parties have won on some aspects, based on a general and more impressionistic discretionary basis. Whichever approach is adopted partly depends on whether the court has a discretion to use costs awards as a sanction in respect of behaviour, which is discussed below. 76. In France, dépens (roughly, official charges, although court fees are limited) are shifted but not frais (roughly, lawyers’ costs). Similarly, in Taiwan, ‘litigation expenses’ (court fees, and witness costs) are shifted but not lawyers’ fees (save in the Court of Third Instance and one other exception). 77. Belgium changed from non-recoverability of lawyers’ costs to their shiftability as recently as 2002. The change was brought about by, first, a desire to recognise the reality that numerous commercial sale agreements included a contractual right to recover the expenses of enforcement; secondly, re-examination of a view that lawyers’ fees were not part of the damage to be compensated under contractual or extra-contractual fault law; and thirdly, the impact of implementation of Directive 2000/35/EC on late payments in commercial transactions, under which the creditor is entitled to claim reasonable compensation from the debtor for all relevant recovery costs incurred through the debtor’s late payment. 29 Since the reform, there has been a dramatic fall in the number of cases brought. Pending further empirical research, it is as yet unclear whether there may have been ‘too many’ cases beforehand, or whether there are ‘too few’ now. 78. Recoverable lawyers’ fees are based on an official tariff (usually in a statute) in Austria, Belgium, Czech Republic, Denmark, Estonia (a maximum recoverable), Germany, the Netherlands, Spain and Poland. 30 Use of a tariff by the Bar has been outlawed by the competition authorities in France and Japan. 29

Art 3.1(e) of Directive 2000/35/EC of the European Parliament and of the Council of 29 June 2000 on combating late payment in commercial transactions [2000] OJ L 200/35. 30 Although there is a tariff in Poland, costs are not in practice predictable, since the rules permit lawyers to apply for the tariff sum to be multiplied in complex cases (and it is reported that the courts readily accede and do not tend to apply significant oversight) or be reduced in simple cases.

20

79. The existence of a tariff for shiftable costs produces the consequence that parties to litigation do not spend time on determining what the actual level of costs might otherwise have been. In larger cases in which shiftability is based on hourly fees, the transactional cost of time recording and determination can be significant. 80. England and Wales have introduced fixed recoverable fees for some specific types of cases (see para 145 below). The use of a tariff gives claimants and defendants predictability of their financial exposure. But the general common law rule, also applied in many civil law jurisdictions, is that lawyers’ fees are freely negotiated. In Greece, there is a minimum hourly fee quoted by the Bar Code. In many jurisdictions, there is a rule that lawyers’ fees should be reasonable (such as in Canada, Denmark, Finland and Sweden). 81. The recoverability gap. In many jurisdictions where costs are shifted, there is a gap between the costs that the winner receives and his or her actual expenditure. This is clearly so in Australia (30-45 per cent), Canada, England and Wales (25 per cent), Estonia, France, Germany, Hong Kong (0-40 per cent), Latvia, the Netherlands, Norway, Poland, Scotland, Singapore (33-50 per cent), and Switzerland (the percentages quoted are the unrecovered percentages of total expenditure). 82. The existence of the ‘recoverability gap’ has led to difficulties because its existence and effects are not always understood. Directive 2004/48/EC 31 aims to increase the number of enforcement actions of intellectual property infringements and provides that the loser shall pay the winner’s costs in full. Those who were involved in the enactment of the Directive appear to have been acting on the assumption that all Member States had a 100 per cent cost shifting rule. The result of implementing this rule in the Netherlands has been that the number of intellectual property injunction claims has fallen because claimants are now concerned that they face an unacceptable risk if they lose a case. 32 Hence, the result of the implementation of the Directive has been the opposite of that intended, simply because the detailed operation of a national cost shifting rule was overlooked. 83. Where the cost shifting rule is applied, it is almost always not absolute, since the court almost always has general discretion over the award of costs, or at least a degree of discretion to alter the general loser pays rule. 84. A justification for this is to enable the court to produce a just result. Some rules specify that a winner should be deprived of costs if he has put the loser to the expense of the litigation unnecessarily, when the proceedings could have been avoided and the case settled earlier. Some rules exempt a losing defendant from costs liability if it

31

Directive 2004/48/EC of the European Parliament and of the Council of 29 April 2004 on the enforcement of intellectual property rights, OJ L157/32, L195/16. 32 P M M van der Grinten, ‘Challenges for the Creation of a European Law of Civil Procedure’ 19 April 2009, at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1392006.

21

was reasonable to defend a case, such as if the true facts were unclear at the start, or the law required clarification, such as on a point of general public importance. 85. One justification that is seen in the theoretical statements is to provide some equality of arms as between litigants of possibly widely differing resources. The cost shift cannot provide an increase in resources to an impecunious party, but it can provide some sort of deterrent (but not of itself prevent) a wealthy party from spending large sums on his case. As such, the rule encourages rationality and proportionate behaviour. 86. Costs as behavioural control? A further justification for court discretion is to provide an incentive for the parties to behave reasonably during the procedure, and if they do not to enable a deterrent sanction of costs to be awarded against them, even if they win. References to the behavioural control justification seem to occur rarely in theoretical writing or in official policy statements (which are in any event rare themselves). It is unclear to what extent the behaviour sanction is in fact applied in practice. This behavioural lever is simply not available where there is no cost shifting, or where costs are recovered on a tariff basis. Further empirical work would be useful on how often such a rule is applied in practice, and how effective it is. An important issue is whether it operates as a control on litigants’ general behaviour, or on the amount of work done, or on inclination to settle – and whether there might be other means of achieving those controls, if relevant. 87. A recoverability gap can provide a tool by which a lawyer may influence his client’s behaviour, such as in avoiding unnecessarily expensive inquiries or adopting a more reasonable approach to settlement. This is reported from Canada but may equally apply in other systems. 88. The cost sanction could be a useful judicial tool in controlling excessive costs. A number of countries effectively provide that only reasonable costs will be awarded to winners. But this case management tool appears to be rarely used in practice. The approach ought to act as a potentially important means of providing a level playing field between defendants who have significantly differing levels of resources, so as to avoid ‘litigation bullying’. But it is not clear how often such a phenomenon occurs, and even less clear how often judges adopt a sanctioning approach in their costs orders. If, as under the general civil law civil procedure paradigm, litigants and their lawyers have little ability to affect the amount of work done (and hence the level of opponents’ costs), and/or the recoverable costs are effectively pegged to a tariff, this danger largely evaporates. 89. Further work could be done on proposing a coherent approach towards the circumstances in which costs should be awarded or not, or reduced. The Taiwanese codification offers an interesting and logical approach. There, a sequence of rules gives a general discretion to the court to award costs either in a certain proportion, or by one party alone, or by both without cost shifting. 33 There are some special rules, 33

Code of Civil Procedure, Art 79.

22

including: the claimant shall pay if the defendant immediately admits a claim (thereby encouraging pre-litigation bilateral negotiation and settlement), 34 parties shall pay for unnecessary acts during the litigation (to encourage proportionality and equality of arms), 35 and where a case is settled, the parties shall bear their own expenses unless otherwise agreed. 36 90. No costs shifting. The reason why the United States of America have a rule that ‘each party pays their own costs’ 37 requires explanation. Whatever the explanation for the ‘American Rule’ may be historically, its persistence – in the face of repeated calls for changes to a loser pays system – is best explained by the critical role it plays in enabling the ‘private enforcement’ of law. The ‘private enforcement’ theory gives civil litigation a distinctive role to play in the U.S. legal system, going beyond providing compensation for loss and providing a mechanism for wider public regulatory and observance goals. Hence, the ‘private enforcement’ policy leads to a coherent integrated approach towards encouraging private actors seeking out, pursuing and rectifying wrongdoing, with no risk and distinct incentives for the ‘private attorney general’. 38 Hence, the rules impose no need for claimants to fund lawyers or to bear the risk of an adverse result; incentivise the legal intermediaries; and provide for extensive access to evidence and sanctions for wrongdoers. However, a significant number of individual statutes provide for ‘one way’ cost shifting against defendants, in accordance with facilitating the above policy of private law enforcement. 91. The primacy of the loser pays rule globally, from the cohort of countries in this study, is supported by the finding that one way cost shifting is a rare exception. Examples of one way shifting are: under certain statutes in United States where the object is to further private enforcement and punishment of wrongdoing; and under legal aid in United Kingdom, to insulate public funds from the expenditure burden of liability for losers’ costs where cases have been supported by legal aid (this is now a rare situation since the 1995-1999 reforms). 92. Some jurisdictions that have a loser pays rule provide for some no cost exceptions. Australia has a ‘no costs’ rule for public interest cases, and maximum recoverable costs in certain types of cases. England and Wales effectively has no cost shifting for small claims (under £5,000), 39 employment tribunal claims, 40 and family cases: 41 in the first two instances, the rules technically empower the court to award costs, but general practice is that costs are not awarded save in very exceptional cases. The 34

Ibid, Art 80. Ibid, Art 81. 36 Ibid, Art 84. 37 The single exception is in Alaska, where a partial cost shifting rule is the norm under State law. 38 Amongst a large quantity of literature see J C Coffee Jr, ‘Rescuing the Private Attorney General: Why the Model of the Lawyer as Bounty Hunter is not Working’, (1983) 42 Maryland Law Review 215, 217; R A Kagan, Adversarial Legalism (Boston/Mass, Harvard University Press, 2001). 39 CPR, Rule 27.14; see Jackson (n 3 above), ch 49. 40 Employment Tribunal Rules, Rule 3891); see Jackson (n 3 above), ch 50. 41 Family Proceedings Rules 1991, Rule 2.71, effective from 3 April 2006; see Jackson (n 3 above), ch 51. 35

23

Netherlands gives the court a free discretion on costs awards under the ‘application procedure’, which applies particularly in family cases. Some of these exceptions may have arisen fortuitously but a consistent feature appears to be an attempt to identify particular situations in which it makes no sense for individuals who have limited resources to find them depleted by unnecessary litigation, and to avoid incentivising proliferation of work within the process. 93. The EU’s Small Claims Procedure, 42 however, includes a cost-shifting rule. According to its Recital 29 the costs of the proceedings should be determined in accordance with national law. Having regard to the objectives of simplicity and cost-effectiveness, the court or tribunal should order that an unsuccessful party be obliged to pay only the costs of the proceedings, including for example any costs resulting from the fact that the other party was represented by a lawyer or another legal professional, or any costs arising from the service or translation of documents, which are proportionate to the value of the claim or which were necessarily incurred. It is primarily a written procedure, unless an oral hearing is considered necessary by the court or tribunal or a party so requests, although the court or tribunal may refuse such a request. The unsuccessful party should bear the costs of the proceedings.

C. Funding (i) Introduction 94. The principal possible methods of funding litigation are: a. Personal funds. b. Funds or services provided as a benefit of membership of an association, such as a trade union. c. Legal expenses insurance (LEI). The traditional type is before-the-event insurance (BTE). In some jurisdictions, after-the-event insurance (ATE) has more recently become available to cover the risk of loser pays liability. d. Funding or services provided by the state (legal aid). e. Free services provided by a lawyer (pro bono). Some states refer to pro bono work as ‘legal aid’. f. Funding by a lawyer of services provided by experts or others – e.g. part of the lawyer’s investment in USA. g. Funding by an independent third party.

42

Regulation (EC) No 861/2007 of the European Parliament and of the Council of 11 July 2007 establishing a European Small Claims Procedure [2007] OJ L 199/1.

24

95. There are often clear historical reasons why certain approaches and combinations of funding systems have developed in the specific situations that apply in a jurisdiction, and which also influence why certain other options have not developed or might not fit into the local architecture. 96. Issues of funding are topical. Currently, almost no governments are making more money available for legal aid – quite the reverse. 43 However, the existence of proportionate and predictable and low costs regimes can at least tend to maintain an existing legal aid scheme. But alternative solutions have to be found. Some alternatives may be outside the civil procedure system. The 2009 CSLS Oxford study on alternatives to dispute resolution, for example, identified some 110 non-court procedures in England and Wales. 44 97. Within the civil procedure system, one possible approach is pro bono advice and representation. It is not entirely clear how widespread this and whether it has a future. There has been an interesting expansion of pro bono in Australia, and it is widespread in Canada. It may be the case that pro bono will be limited to provision by large commercial law firms, as part of their corporate social responsibility (and marketing) programmes. Small firms cannot afford to deliver significant pro bono service, and claimants need expert representation in at least some types of case 98. The most interesting development concerns private funding. Some ideas are for raising additional funds from successful litigants, which would establish a fund to support litigation in return for a percentage of the recovery, by way of establishing a Supplementary Legal Aid Scheme (SLAS) or Contingency Legal Aid Fund (CLAF). Hong Kong has operated a successful SLAS but with very small numbers, cost and risk. As with any legal aid scheme, there are two key questions. First, where does the seed funding come from, and secondly, whether the loser pays rule should be kept, and if so, should the assisted party or the fund assume the risk?

(ii) General Results 99. Every civil justice system gives rise to a requirement for funding the pursuit or defence of a legal claim. 100. Legal aid. Some formal amelioration from litigation cost applies in every jurisdiction apart from Russia and the United States of America. In the United States, a major reason for the non-existence of legal aid is that the availability of contingency fees (in addition to hourly or other negotiated fees) makes it unnecessary.

43

The exceptions seem to be New Zealand and the Netherlands, noted below. M Tulibacka and C Hodges, English Justice System – Beyond the Courts: Mapping out the non-judicial civil justice mechanisms (Research Report of the Centre for Socio-Legal Studies, Oxford, 2009), at http://www.csls.ox.ac.uk/european_civil_justice_systems.php. 44

25

101. Countries adopt different approaches to ‘legal aid’, and it can mean quite different things. The principal variants are: a. The lawyer acts free to the party, but works pro bono. In Austria, the state in return pays an annual sum to the Bar Association, which is allocated to pensions for lawyers. b. The lawyer is paid by the state. This is fairly widespread, but far from universal. c. Assisted parties may be required to make a contribution towards the cost, either making a payment to their lawyer or to the state. d. The assistance might only cover provision of the services of a lawyer, and not cover opponents’ costs because the latter are not shifted, as in Taiwan. Hence the legal aid budget is potentially smaller than it might be in other states where costs are shifted and the fund indemnifies the liability. e. Where costs are shiftable, the ‘legal aid’ assistance might cover opponents’ costs if the case is lost, or it might not. Individuals remain liable for winning opponents’ costs in Finland, Italy, the Netherlands, Sweden and Switzerland. This rule presumably applies whenever representation is pro bono, i.e. by a lawyer on an unpaid basis: this is certainly the case in Bulgaria. This rule might act as both a barrier to justice, and a disincentive to bring unmerited claims, and might also encourage settlement (whether justified or not). 45 Empirical research is needed to analyse the position further. f. An application for legal aid might be determined by the court (Austria, Bulgaria, Germany, Greece, Poland, Norway, Romania, Taiwan), by the bar (Czech Republic), or by a public authority (England and Wales, Finland, France, Hong Kong, Ireland, Latvia, the Netherlands, New Zealand, Scotland, Singapore, Taiwan). Where a party has to apply to the court after the start of a case, the problem is that the applicant may not know, or be able to predict, whether he or she will be awarded legal aid, or how much assistance, without commencing a claim. In contrast, where the decision is taken by a separate administrative authority, some advance risk assessment can be undertaken confidentially before taking the decision to start proceedings. g. A Supplementary Legal Aid Scheme (SLAS) applies in Hong Kong to supplement the state’s Ordinary Legal Aid Scheme (OLAS). The SLAS was 45

The rule that the public funds will not indemnify an assisted person for opponents’ costs if the case is lost is a striking and important feature. It is the opposite of the rule in England and Wales that had significant practical effect prior to the deconstruction of civil legal aid and introduction of conditional fee agreements (CFAs) around 1999. The non-indemnification rule should have a powerful effect on ensuring that claimants assess the merits of cases at the outset, but might also lead to under-claiming where the merits are unclear or uninvestigatable at that stage. A number of large English group actions that failed and cost legal aid large sums might not have been commenced if this non-indemnity rule had applied.

26

established with seed funding from a local charity, and is sustained by levying 10 per cent of the recoveries of funded claimants. It is fairly small in scope. 46 102. In advanced economies, public funding of legal services through legal aid was a significant plank in the strong consumer protection movement from the 1960s to 2000, reflected in the European Directive 2002/8/EC 47 that set basic parameters for Member States in providing state funding for legal services. However, during the 2000s, and especially since the financial crisis of 2008, it has been clear that governments will not provide further public funds for legal services.48 Legal aid, therefore, generally remains available only at a very limited level for the very poor that have cases with reasonable merits. 49 Almost all legal aid systems include means and merits tests. 50 103. In view of the limited scope for legal aid, governments face the issue of how to provide access to justice for those in the population who do not qualify. This middleincome group is significant and growing in terms of numbers in a large number of jurisdictions. In Western Europe, for example, legal costs are so high in many jurisdictions (Germany being a notable exception) that many cannot afford to bring or defend a claim: the United Kingdom coined the phrase middle-income-not-eligiblefor-legal-aid (MINELAs) for this group. In Central and Eastern Europe, the income level of most of the population has been low but the number of better paid people is rising, so a similar problem will increasingly arise there. 104.

Responses to this funding gap have been of different lines:

a. Provide alternative dispute resolution pathways that are cheaper (and quicker), whether through mediation annexed to the court process or some external pathway, such as ombudsmen or compensation schemes, especially for certain types of disputes, e.g. small claims, debt, housing, family issues. This is notable in Belgium (emphasis on mediation introduced 2007), Canada (special administrative procedures established as a response to widespread access to justice crisis for employment matters, workplace injuries and motor vehicle accidents, and indemnity arrangements such as under the Canadian Medical practitioners Association, which assesses claims and decides either to pay out or defend), Denmark, the United Kingdom (mediation emphasised in the court 46

In 2007, the OLAS, which funds individuals who have financial resources under HK$165,700, had an expenditure of HK$327 million, recovered for aided persons HK$740 million, had 15,462 applicants, of whom 7,858 were granted support. In the same year, the SLAS, which funds individuals with resources between HK$165,700 and HK$460,300 and required contribution of 10% of recoveries, paid out HK$4.8 million, recovered HK$39 million for claimants, and had 136 applicants, of which 79 were granted support. 47 Directive 2002/8/EC of 27 January 2003 to improve access to justice in cross-border disputes by establishing minimum common rules relating to legal aid for such disputes [2002] OJ L 26/41. 48 Civil legal aid was severely restricted in Sweden in 1997 (see F Regan, ‘The Swedish Legal European Judicial Systems 2002: Services Policy Remix: The Shift from Public Legal Aid to Private Legal Expenses Insurance’ (2003) 30 JLS 49 and in the United Kingdom (1999). 49 Exceptions are the Netherlands, where legal aid covers 40% of the population, and New Zealand, where public expenditure on legal aid is rising significantly 50 France has no merits test.

27

system, and a huge growth in non-court alternatives), Finland, Japan (especially since it has often been said that litigation runs contrary to the national culture), New Zealand (the Weathertight Claims Tribunal and the no fault accident compensation scheme), Norway (all claims under NOK 125,000 are required to start in the Conciliation Board before proceeding to court, and cases valued at over that amount may start at the Board or in court), 51 Portugal (2008 reforms), Sweden and Taiwan (including lower fees for court mediation than for court litigation, and remission of court costs where settlement is reached). b. Encourage privatised funding through permit a loosening of the prohibitions against certain types of private funding, e.g. no win no fee, success fees, third party funders who take a percentage of the damages, recoverability of costs, etc. Notable examples are Germany (contingency fees permitted from 2008, although under restricted criteria and unlikely to be widely used) and England and Wales (conditional fee agreements (CFAs) since 1995, extended 1999). c. Encourage pro bono advice, especially where there is a sufficient spread of affluent lawyers. Leading examples are Australia, Canada, England, Norway, Poland, Russia, Singapore. On the other hand, pro bono is banned in Switzerland! These examples seem to include countries where either there are many rich lawyers, or there is a widespread low standard of living, which includes lawyers. 105. Success fees and contingency fees are banned in some countries but lawyers in other jurisdictions may charge them. Appendix VI summarises the position on such fees. 106. Many jurisdictions permit success fees, payable only if the lawyer wins, as an element (never a single element) in lawyers’ remuneration. Such fees are banned in Austria, Singapore, and technically prohibited but used in practice in Russia. The success fee would typically be paid in addition to a basic fee. Sometimes, an initial fee is paid at the start of the case, and a success fee – or nothing further – is paid on conclusion. This approach clearly gives predictability. The success fee is capped in some states, such as 20 per cent of the damages awarded by the court in Greece, 25 per cent in Australia and the Czech Republic, and 100 per cent of the basic fee (usually, work done multiplied by an hourly rate) in the United Kingdom. 107. Few states provide a general statement of principle such as that to be found in Norway, that a lawyer may not take an assignment where personal economic interests may come into conflict with the assignment and the client’s interests. In those jurisdictions where contingency or conditional fees have emerged, the ancient prohibitions against maintenance and champerty 52 simply have been amended (by 51

In 2004 in Norway, 218,157 cases were started in Conciliation Boards, of which 7,766 settled, 16,318 claims were accepted, and 3,791 cases were referred to the courts; 13,450 cases were filed in courts. 52 Maintenance is the giving of assistance or encouragement to one of the parties to litigation by a person who has neither interest in the litigation nor any other motive recognised by law as justifying the

28

legislation in England, 53 and by the courts in Australia 54 ) as a matter of pragmatism, in order to facilitate the development of private funding. 108. Conditional Fee Agreements (CFAs) in England and Wales. After it became clear that significant public funding for lawyers was unsustainable, legal aid was restricted and the function largely privatised, through the creation of CFAs. There were many teething problems with CFAs, associated insurance (ATE), and with the coincidence of the new front-loading of work through pre-action protocols, manifested in a sequence of ‘costs wars’. 55 109. Contingency fees. The term ‘contingency fee’ is capable of being interpreted with different meanings. Although it usually refers to payment of an integral fee being a proportion of the recovery and solely dependent on success, this might be a single, integral fee, or it might be part of a total compensation arrangement that might also include other sums (e.g. a basic fee or a fee paid on a low hourly rate). 110. There is a strong cultural resistance in many states to fees in which a lawyer can be paid a percentage of the money recovered (pactum de quota litis). This is banned in Australia, 56 Austria, Belgium, Cyprus, Czech Republic, Denmark, France, Greece, Ireland, Luxembourg, Malta, the Netherlands, Norway, Poland (but found in practice), Portugal, Romania, Russia (unenforceable but used), Singapore, Sweden (but permitted in special circumstances, eg class action), and UK. Contingency fees are permitted in Canada, Estonia, Finland (rarely used), Germany (in fairly rare circumstances), Hungary, Italy, Japan, Lithuania, Slovakia, Slovenia, Spain (rarely used), Taiwan and notably in United States of America, where it provides an essential funding mechanism (discussed in para 72 above). 111. In Germany, permissibility of a contingency fee was introduced in 2008 as an exception in an individual case where the client would otherwise be prevented due to his financial circumstances from pursuing his legal rights (i.e. impecunious, or could not take the financial risk). Such agreements must be in writing. They may permit ‘no win no fee’, or a reduced fee, if there is a reasonable supplement payable for success. 112. Contingency fees were introduced recently in Canada as a means of increasing access to justice, especially in personal injury cases, where they are now widely used, but there have been no studies on whether the previous lack in efficiency and effectiveness of legal services has been remedied as a result of introducing them. 57 The theoretical justification was to unlock funding by lawyers, and to align the lawyer’s interests with those of the client in obtaining expeditious resolution of the interference. Champerty is a form of maintenance whereby the maintainer has an interest in the proceeds of the litigation. Giles v Thompson [1993] All ER 321, HL. 53 Courts and Legal Services Act 1990, s 58; Access to Justice Act 2000, s 27. 54 Campbells Cash and Carry Pty Ltd v Fostif Pty Ltd [2006] HCA 41. 55 See Jackson (n 4 above), ch 3. 56 The ban is not applied for commercial cases, but remains solid for individuals’ claims. There is little appetite for removing the ban. 57 Erik S Knutson and Janet Walker, Report for Canada.

29

matter with the maximum recovery. A practice of awarding the recoverability of a ‘risk premium’ for a lawyer who takes on a meritorious risky case was struck down by the Supreme Court of Canada in 2006 58 as preventing predictability of cost exposure by defendants, but the practice has continued on the basis of separate permitted factors for discretionary awards. 113. Contingency fees form an essential funding mechanism for litigation in the United States of America. But they are not the only mechanism and attorneys there are free to accept work on whatever basis they choose, and may decide to accept certain cases or types of cases on an hourly rate or fixed fee basis. Certain types of case are less suitable for contingency fees, such as cases that do not involve quantifiable damages or do not have a statutory one way fee shifting rule. Attorneys tend to have a portfolio of contingency fee cases, comprising an acceptable mixture of individual risks. Contingency fees are unlikely to be worth taking on for cases under around $150,000 in damages. Claimant lawyers’ fees in class actions are approved by the court (so are not subject to contingency agreements with clients).

(iii) Legal Expenses Insurance (LEI) 114. Predictability of litigation costs means that insurance can be more readily available. This is why LEI (BTE) is so widespread in civil law procedure jurisdictions, exemplified by Germany. LEI is reasonably or widely available in Denmark, England and Wales, Estonia, Finland, France, Germany (43 per cent of the population), Hungary, Ireland, Japan, the Netherlands and Spain. 115. ATE arose in England and Wales from 1995 to insure claimants against the adverse costs risk that appeared when CFAs largely replaced legal aid. Premiums were initially paid for by the claimant through a reduction in damages, but the rules were changed to make the full CFA fee and ATE premium recoverable from the defendant. That provoked huge costs wars, with insurers trying to reduce their exposure. The media industry has been particularly vocal in complaining against the combined disproportionate effect of having to reimburse CFA success fees and high ATE premiums. Allegations of settlement blackmail arise.

(iv) Issues with Regard to Third Party Funders (TPFs) 116. An important recent development is the creation of third party funders (TPFs), notably spreading from Australia (typically with a 20-40 per cent fee) and in some European jurisdictions (Austria, Germany, Ireland, the Netherlands (where the fee can be 25-40 per cent of the recovery) and United Kingdom). The fee is not recoverable under the civil law tariff systems, so is deducted from damages.

58

Walker v Ritchie [2006] 2 SCR 428.

30

117. Because TPFs are such a recent phenomenon the evidence from the jurisdictions studied is far from conclusive. It is clear that various issues arise in relation to TPF, which deserve wider debate. It is rather less clear how national systems will resolve them. All we can do in this Preliminary Report is to point to the most pressing questions. 118. Are TPFs any different to public funders or lawyer funders? What parameters do they need to operate under? What controls and regulation do they need? The longenshrined principles of maintenance and champerty 59 have swiftly crumbled under the pragmatic necessity of simply enabling the civil justice system to keep operating. 119. Should TPFs exercise control over litigation? How much, when, and how? The considerations to be balanced are, on the one hand, that the arrangement represents an investment decision by the funder and, on the other hand, the concern that there should not be undue interference in the collection or presentation of evidence or of a case or in relation to settlement, since this would undermine the fairness and objectivity of the legal process and decisions. So, who should have what risk? There is little objection that funders should be entitled to full information over the developing risk, in the same way that shareholders are entitled to disclosure of accurate and timely information on the value of their investments. But should funders be permitted closer access to the running of the enterprise, and be in a position to influence behaviour and decisions? 120. If TPF is acceptable in principle, what is the difference between funding from independent parties and by lawyers engaged in the case? The simple difference is that some intermediaries have conflicts of interest. Are these significant, acceptable or inappropriate? Should they be banned, or permitted, and if so, to what extent and how regulated? 121. TPF tends to apply only to high value cases, hence primarily commercial cases. If TPF is not a solution to individual low value claims, and legal aid is limited or disappearing, what is the solution for funding small claims by the needy, so as to provide access to justice? How many of such claims fall outside the ‘small claims’ track (typically not requiring lawyers and without cost shifting) that is spreading in some states, such that there remains a problem? How many such claims might be catered for through alternative pathways? How many remain? If a decision on merits and investment has to be made, is the simplest solution for this to remain that of an individual lawyer, who might decide whether to act on a CFA or contingency fee? If so, should the success fee be recoverable from the loser, or costs shifted only on a tariff fee basis?

59

See n 52 above.

31

IV. DISCUSSION AND CONCLUSIONS

122. This part presents the views and conclusions of the authors of this study, including suggestions for further policy and research. 123. Issues of costs and funding seem to have received little critical or academic attention in many jurisdictions. Hence, the theories and policies underlying the rules have not always been clearly articulated or scrutinised. The economic considerations seem to be based more on the pragmatic reality of the need to provide for the economic necessities of enabling litigation (and access to justice) and on broad principles of fairness. For example, the general approach is merely that an instigator should have to provide funding for initiating the litigation machinery (use of the courts, a lawyer, witnesses of fact and expertise) and the loser should have the broad responsibility of reimbursing these sums if he loses. 124. However, the absence of more detailed thinking may provide an opportunity for governments to reassess how civil justice systems operate in the 21st century, and to reform their rules in accordance with modern principles, and even to produce a measure of alignment in them. 125. Funding and costs are totally inter-linked issues. If a litigant cannot afford to claim or defend a right or loss, access to justice is denied. Many legal systems are based on the ‘loser pays’ cost shifting rule. This is justified as a matter of fairness and compensation, but has the secondary functions of enabling the court to exercise some discretionary control over conduct during the litigation process and of encouraging reasonable behaviour and early settlement. Many systems differ in the extent to which costs are recoverable, and over whether the secondary objectives are achieved in practice. 126. There is currently widespread unease about whether traditional costs regimes deliver best solutions. In particular, there remains debate over whether access to justice is being delivered for different sections of society, and for different types of cases. Some jurisdictions have embarked on cautious innovation. Real understanding on such issues is hampered by an absence of detailed analysis and reliable empirical data. 127. If procedures are too complex, then the whole process takes too long and is too expensive. There has been little attempt under any system to measure civil procedure systems against the parameters of duration and cost. This needs to be done. 128. In this analysis, we attempt to review civil justice systems against the simple criteria of predictable costs, proportionate costs, low cost, efficiency and duration of procedure. The limitations in the available data need to be recognized, but this study is a start. The principle of proportionality is relatively new, but it is suggested that it is an important criterion that should be widely and objectively

32

applied. Many of the practitioners who contributed to this study accepted that, in their respective jurisdictions, litigation costs overall were either not predictable or proportionate, and they were unable to offer a verifiable objective statement that costs were generally proportionate.

(i) Court Costs 129. Although much of the cost, and hence the focus of the following discussion, lies with the costs of lawyers and experts, an important point remains to define what the basis of charging a state should be for use of the courts. The general consensus (France and Sweden notably apart) is that individuals should pay for the dispute resolution services provided by the court. Such costs could, to a significant extent, then be passed on to the loser. 130. But there are arguments that the state has an interest in maintenance of the rule of law, in clarifying and applying the law, in providing affordable access to justice and in promoting dispute resolution through its approved processes. On that argument, the cost of the courts should, at least in part, be shared by society through general taxation. The result is perhaps influenced more by considerations of pragmatism than principle: it depends on how much the cost is. If the courts’ budget is not particularly large, then access fees for individual litigants need not be large. But if court costs are high, and payable largely by individual parties, access to justice issues will tend to arise. 131. It is clear that jurisdictions generally apply a cost tapering approach, i.e. that court costs are low for low value claims, and/or negligible for needy people. Many states levy court costs that rise accordingly to the amount in dispute. The logic for such an approach is not clear: more expensive cases do not necessarily involve more court time or resource. There would seem to be much force in the principle that fees should be differentiated on the basis of the extent of use of resources. On the other hand, such an approach might be difficult and unduly complex to apply. There is also a point that some tapering of costs might be useful, since charges levied from higher cost cases might subsidize lower fees for smaller cases, thereby assisting access to justice. On the other hand, a more principled approach would be for fees to be set at a level that reflects actual costs, and if sums are to be reduced for low value cases on grounds of encouraging access to justice, the funding should come from general state funds and not be a hidden cross-subsidy from litigants in larger cases. 132. The rules on court costs in some jurisdictions include the imposition of many individual small charges, producing unnecessary complexity and increasing bureaucracy. It can, of course, be argued that if there are many particular circumstances or pathways that need to be considered, then charges should be clearly apportioned. However, there needs to be a balance between cost recovery and simplicity. It is recommended that there is clearly scope for simplifying court

33

charges in many countries. Court fees should be few in number and simple to apply. 133. There clearly needs to be an initial fee for accessing the court system. Should there be further fees and, if so, how many and for what? One principle is that fees should tend to reimburse the quantity of public resources that litigants use. On that basis, subsequent fees should apply to major subsequent steps, notably applications or hearings. However, as noted above, a proliferation of individual fees is inadvisable. Both civil law and common law systems charge fees for the major hearing: in the German system there is simply a fee for the first hearing (and a significant number of cases may only involve one hearing, or subsequent hearings may be short), whereas in England there is a significant fee for setting down a case for (the single) trial. Another approach would be that fees should tend to encourage particular behaviour, notably settlement. Hence, some systems return a proportion of court fees if a case settles before a specified event, such as delivery of judgment. That approach is attractive from the points of view of saving public resources and encouraging parties’ resolution.

(ii) Lawyers’ Costs 134. From a lawyer’s perspective, there should be a fair fee for work done. That is the rule in, for example, Ireland, where the rules do not mention a requirement for proportionality between the level of fee and the value of the case. Most suppliers of goods and services would expect and be entitled to a fair fee for work done. But a fair fee for the amount of work done might not necessarily be one that is proportionate to the sum in dispute. It is argued that the legal services market does not operate on the basis of normal economic forces, and requires regulatory intervention. The need for a dispute resolution mechanism that is provided by the state to operate on the basis of costs that are proportionate is of some importance. Civil society and the state have an interest in ensuring that rights may be upheld, debts collected, government challenged, and so on. So the application of a principle of proportionality can be seen as a justifiable matter of public policy. 135. A principle of proportionality of costs can be difficult to apply in practice. It may vary from case to case, and between different types of case. Not all types of cases involve costs that are ‘high’ and/or ‘disproportionate’. 136. The criteria against which the proportionality of costs should be measured need to be established. A criterion of the amount of work done can clearly lead to problems, and justify an unacceptably high fee (especially if magnified also by a success fee). Some national rules provide that the criteria that should be taken into account in setting a lawyer’s fee include not just the amount in dispute (where that is quantifiable, and some cases are not) but also the value of the case to the party. Proportionality to the sum in dispute might favour clients, since this might lead to a lower fee than if the importance of the case were taken into account; in contrast,

34

proportionality to the importance of the case to the client might favour the lawyer, by justifying a higher fee than would result from considering the sum in dispute. 137. The value of a case might well justify a supplement in some other standard types of supply of services or goods, but the problem in relation to legal services in litigation is, again, the public policy interest in maintaining proportionality. 138. The principle of proportionality of costs is still recent, and not yet widely adopted, but set to spread further. The impression from the national reports is that lawyers’ fees are in many cases too high, especially in common law jurisdictions, and governments may increasingly wish to regulate legal fees so as to reduce them. A debate has yet to occur over whether seemingly established ‘rules of thumb’ that fees, or success fees, payable to intermediaries (whether lawyers or other funders) of around 30 per cent (or any other percentage), whether of standard fees or of the amount recovered, represent fair value. Does a percentage approach include a proportionate result? English cases on CFA success fee uplifts in the past decade seem to set a far lower standard for acceptable uplifts, and there has been notable judicial consensus and intervention that some cases justify only small percentage uplifts. 139. The largest element of cost in much litigation is lawyers’ costs. This is not always the case, since small or straightforward cases can be done at low (or no) lawyers’ fees. In looking at lawyers’ costs, one needs to focus on two separate elements: the amount of work done and the cost that is payable. The former factor has two aspects: it relates first to the architecture of the civil process, which defines the general parameters of the work that needs to be done, and secondly to the amount of work actually done in an individual case by a given lawyer. The question in both aspects is the same, namely whether the amount of work is too much, and can be reduced. The latter factor gives rise to consideration of the available methods of funding and charging, for which every jurisdiction has a different set of options, albeit there are themes and similarities across many states. 140. If market forces are not enough to deliver predictable and proportionate costs, what other approaches might be applied? 141. The findings of this study show that lawyers’ costs are not predictable in most jurisdictions. This lack of predictability applies both in relation to the costs that should be paid by a client to his lawyer and to the costs that a winning party might recover from the losing party. 142. Lawyers’ costs are only truly predictable where a straightforward tariff applies. Such (double) predictability occurs in systems like Germany. In contrast, in common law countries, experienced lawyers might be able to predict both sorts of costs with some level of accuracy; the level of accuracy may significantly depend on the type of case involved: for example, some cases (RTA, debt recovery) are straightforward and involve well known and predictable steps, so costs should be both predictable and

35

relatively modest. Larger commercial cases, however, may involve a great deal of work (especially under the common law approach to civil procedure) and costs may be almost entirely unpredictable. This conclusion leads on to important consequences in relation to the design of the civil process, which are examined further below 143. One way of looking at controls on lawyers’ costs is to analyse them into ex ante or ex post facto controls, in accordance with classic regulatory theory. There should be a strong expectation that ex post facto regulation (review and reduction by the court: common law ‘taxation’) will be less successful in delivering predictability. So ex ante controls such as tariffs and fixed costs should be far preferable in delivering predictability. That is borne out by the case studies: the tariffs of the civil law world are clearly preferable to the common law world (of free market rates and ineffective ex post optional costs assessment) in delivering predictable costs – where there is cost shifting. 144. Where there is no cost shifting, a ‘no win no fee’ system is entirely predictable, since it delivers no cost to the claimant if he or she loses and no cost shift to the defendant if he or she wins. But there is still cost in the system: if the claimant wins, the contingency fee system reduces the claimant’s damages by the amount of the (unrecoverable element of) success fee, and the defendant who settles often has to pay an element towards the winner’s lawyer’s costs. The American system of extensive discovery can clearly give rise to very high cost. 145. England has attempted to make lawyers’ costs predictable in some types of cases, through introducing fixed costs. 60 This approach looks likely to be extended as a result of the Jackson Review to all fast track cases (i.e. all under £25,000) and may be extended further. 61 This development is to be welcomed. As noted above, one approach to the introduction of fixed costs depends on the ability to predict the amount of work that will be necessary in a particular type of case, the existence of a sufficient volume of individual cases of that type, and the fact that the amount of work done in the vast majority of cases of that type falls within an acceptably small range of cost. If this is so, then the question that arises is whether a system of civil procedure can identify individual case types that are susceptible to a standard procedural approach, since they involve a standard amount of evidence, pleading and work, and for which most individual cases do not diverge significantly from the standard model. It is inherent in such an approach that different case types need to be analysed individually, and might need to be processed differently.

60

Fixed costs currently apply (with success) for: a. Uncontested cases. b. Road traffic accidents: i. predictable costs in low value RTA claims settled before issue; ii. predictable success fees in all other RTA claims. c. Success fees in employers liability and employers liability disease cases. d. Fast track (under £15,000) trials 61 See Jackson (n 4 above), Part 5.

36

146. It is not essential that every case should involve exactly the same amount of work, so that the fixed costs exactly cover the actual cost in each case. In order to make fixed recoverable costs work, assuming that no irrecoverable costs are to be paid by clients, the same approach is needed as has been found to apply in contingency fees in the United States, 62 namely that lawyers may take on a portfolio of different cases, some of which involve higher or lower returns, but overall the portfolio balances out to be a sufficiently profitable enterprise. On this basis, there must be an acceptable range of risk and profit within the portfolio as a whole. For example, it might be important that the cases should not deviate too far from a general standard amount of work or cost. However, if it is accepted that there is a recoverability gap that the client has to fund, for example out of damages if they are high enough, such considerations are ameliorated – unless the client loses. 147. An anecdotal comment made by practitioners who practise in European jurisdictions that do not have tariffs or fixed fees is that, unless a small claims procedure or other special process applies, cases for an individual under €10,000 or a company under €100,000 are not worth pursuing from the perspective of the prospective litigant, because costs are too high, i.e. not proportionate. 148. However, the mere existence of a tariff or fixed fee structure does not necessarily result in costs that are proportionate to the amount that is in dispute. Very few jurisdictions seem to have attempted to address the issue of whether lawyers’ costs are proportionate. The leading recent example of where this has been attempted is England and Wales from 1999, and Canada has introduced the concept of proportionality in 2007. But the English attempt is widely thought not to have succeeded. In fact, success there has been partial: the fixed costs regimes have been successful; it is the larger types of cases (notably personal injury and larger commercial cases) where costs remain uncontrolled. The intention of Lord Woolf that case management by judges should control costs has not been sufficiently applied in practice: whether such an approach might succeed remains unproven. 149. Courts almost everywhere have the power to award costs and to depart to some extent from any tariff that applies – at least in theory. Such an approach retains some control over behaviour by the parties and might encourage settlement, but the force of these ideas in practice is unclear. The incentive to settle is clearly increased as higher costs apply, perhaps disproportionately. However, court discretion reduces predictability, at least if the discretion is exercised more than rarely. Further empirical research should examine how important court discretion is over costs, and the extent of need to control party behaviour. The classic fixed tariff recoverable cost systems involve no discretion, so provide no such behavioural control, and seemingly have little need for it. Perhaps it would be better to develop a system with a strict tariff that allows for a number of limited and clearly circumscribed (and thus predictable) exceptions, rather than a conferral of vaguely defined ‘discretion’ on

62

See H M Kritzer, Risks, Reputations, and Rewards: Contingency Fee Legal Practice in the United States (Stanford University Press, 2004)

37

judges. Of course, such rigour will come at the expense of substantive justice in a (small) number of cases. 150. As noted above, there are two aspects to lawyers’ costs: the own-client costs and shiftable costs, if applicable. In many common law jurisdictions (apart from the United States) the shiftable costs are linked to the time-and-hourly-rate basis of work actually done (what Americans would call a ‘lodestar’ rule) for own-client work for the winner. It is this situation that inevitably gives rise to the traditionally imponderable problem of how to control the amount of work done by an opponent, and how to reduce the shiftable costs post facto, which, as noted above, is always going to present a more difficult regulatory challenge. A party might not know whether she is going to win, and might be unable to know how much the other side is going to try to recharge, or how much the claimed bill is going to be able to be cut down by negotiation or, at further cost, by court assessment (taxation). 151. Against this background, it is interesting to consider the outcome of a rule that costs are shiftable on the basis of a tariff – irrespective of the amount of work done. This is the position in the German-style systems, where different tariffs apply to ownclient and shiftable costs, although the percentage shifted is dependent on the court’s award over what percentage of the shiftable tariff costs each party should pay. If such a position were applied more widely in a common law jurisdiction, it would deliver considerably increased certainty, offer the possibility of keeping such costs proportionate and low, and might have some consequential limiting effect on amounts charged for own-client costs. This route towards further use of fixed costs, on which England and Wales have made some progress and seem likely to extend, is an important and justifiable step. The approach depends on commodification of important types of claim that arise frequently and/or present cost problems, especially for those who have difficulty affording the level of costs that might be involved. 152. An argument against a fixed recoverable tariff is that it is arbitrary. Why should cost be based on an arbitrary percentage of the amount in dispute, since this does not take into account the amount of work that might be needed to be done in a case, especially in relation to different types of case? On the other hand, predictability has a number of benefits. Hence, certainty is traded for arbitrariness. If a tariff is to apply, should it be developed (on the approach outlined above) from consideration of the amount of work done in a standard case, or should it be linked (as under the German-style approach) to the amount at stake in a given case? The former approach might tend to be linked too closely to continuation of rent-seeking behaviour by intermediaries, whereas the latter approach is again largely arbitrary. Further consideration should be given to the extent to which either approach matters, or delivers proportionality. If a tariff is related to value at stake, does this lead to enough work being done by a lawyer in a small case, or does the architecture of the legal system mean that such a consideration is not that important? Conversely, if the architecture of the legal system means that the amount of work that lawyers have to do does not vary significantly as the value at stake rises, does this not overpay them in higher value cases? Or, if that is so, are the amounts in the overall tariff set in such

38

a way that lawyers can appropriately cross-subsidise taking on loss-making smaller value cases by profit-making larger value cases? 153. Fixed costs are more difficult to apply to larger and more complex commercial cases, where the scale of evidential and other issues involved vary between cases and are resistant to standardisation. In such cases, effective and strong case management by judges is of paramount importance, so as to define the issues, specify and limit the work done, manage costs as much ex ante as possible, and positively encourage settlement. 154. Where costs are based on a tariff or lump sum, the consequence arises that the lawyer does not need to record individual units of time worked. Thus, if he is not working on an hourly rate, and costs are either not shiftable or are shifted on a basis that does not relate to time worked, there might be a saving in the costs and overhead of the time recording process.

(iii) Cost Shifting 155. Some may question whether a costs sanction is irrelevant as a control on behaviour during the litigation process. The hypothesis should be empirically investigated. Such a control does not apply under a civil law tariff system, but then the activities of parties and lawyers under that system are constrained by its architecture. Bad behaviour in litigation and carrying out excessive work, perhaps for tactical reasons, would seem to be able to arise to a greater extent under a common law system (with ex post control on costs) than under a civil law procedure system. 156. Almost every system regards cost shifting as correct as a matter of principle. There is some evidence that a costs shift encourages settlement, or earlier settlement, but the strength of this effect obviously relates to the size of the expenditure and risk involved, and their predictability. 157. There is clearly a widespread problem over the predictability of the costs that are shiftable in respect of lawyers’ fees. A clear recommendation is that recoverable costs should be as fixed and predictable as possible, as early as possible. It provides transparency and predictability for all parties, and supports an equality of arms. The issue, therefore, is how to design a civil procedure system that enables costs to be predictable. Should the costs vary on a scale linked to the amount in dispute, or to the type of case? Which approach gives an accurate measure of the amount of work that needs to be done, and hence deserves to be paid for, whilst also providing the lowest acceptable cost?

(iv) Costs and the Architecture of Civil Procedure

39

158. What do the findings of this project indicate in relation to the architecture of civil process? Civil procedure is not the same in any states. It is helpful to consider three broad models of civil procedure: at the danger of over-generalisation, these may broadly be described as the civil law model (typified by Germany, but other civil law jurisdictions share important features but display significant differences as well) and the common law model, with the American model being a distinct further type. a. The German civil procedure has admirable features of speed, and predictable and low costs. Much of the work is done by judges (hence a need for more judges than in some other systems) rather than lawyers (hence lower lawyers’ costs than in some other systems). Judges focus on those issues that remain in dispute, and positively facilitate settlement. Evidence, expertise and narrowing of the issues occurs in a series of short hearings. The efficiency of the system and other factors have not encouraged the development of mediation or many other alternative settlement approaches. b. In the common law system, much of the seeking out of evidence (witnesses of fact, documents, and expert assessment) is done by lawyers, which necessarily involves more people than if the work were done by a single judge, and the more work that is necessary the higher the costs. The objective is a final trial but many cases settle during the process through mediation and other ADR techniques. Recent innovations include attempts to restrict the extent of evidence and experts, to have stronger directed case management through protocols and by judges, to identify streamlined approaches to different types of cases, and to encourage ADR. c. An extreme and unique manifestation of the common law approach is the American civil procedure system. As noted at para 72 above, the private enforcement function that is emphasized in the United States leads to the adoption of particular rules on no cost shifting, one way cost shifting under certain statutes, and no funding requirement for those individual claimants who agree contingency fees with their lawyers. Many cases may be resolved at proportionate cost to claimants, and successful claimants’ recoveries fund their lawyers (but not opponents). In some cases, there will be a great deal of input by lawyers, so costs can be very high. 159. One conclusion from examining the above first two (civil law and common law) paradigms is that the models are fundamentally unlike each other in their basic architecture. Further, the American model of private enforcement is itself distinct from almost every other system, because its basic objectives are different. The German and English models, to take two European examples of the paradigms, are also quite different in their procedure, notably the division of workload between lawyers and judges, and many more detailed consequences follow. However, there are signs of some movement towards each other in relation to extending or limiting documentary evidence, use of single experts, and specification of activities through protocols that lead to fixed costs in certain types of cases.

40

160. Another very important conclusion is that there is an inextricable interconnection between the architecture of the procedure and the cost rules. The rules were designed with the costs rules in mind, and vice versa. It may, therefore, be difficult to extract and transplant one feature, say predictable and low costs, into a foreign procedure that has a different architecture. For example, if the English system were to provide a German-style costs tariff for all cases, it would be inoperable without the aspects of German civil procedure that systematically produce low and predictable costs. 161. As noted above, a costs tariff only works where the amount of work is stable and predictable for the vast majority of cases of the particular type that it covers, with few outliers. The German model applies a costs tariff with a scale depending on the amount of money in dispute. That has the considerable benefit of simplicity, but the amount in dispute does not necessarily equate with either the complexity of a case or its importance to the parties, and takes no account of case types. In contrast, England has taken the approach of looking at some (not all) case types in order to define standard approaches and hence standard costs: the technique used has been the definition of pre-action protocols, which specify, to a greater or lesser extent, what each party has to do. Hence, both the traditional German and more recent English approaches in specifying fixing predictable costs produce this similar outcome of predictability, although the mechanism by which they arrive at that result is different (one being based on a tariff dependent on the amount in dispute and the other defining a paradigm standard case and then costing the amount of work to be done). The German approach involves some level of proportionality (to the amount in dispute) whereas the English approach gives predictability but not necessarily proportionality. If the English fixed costs are to be proportionate, the review process needs to involve some reduction on either the amount of work done or the hourly rates on which the calculation is made to produce the final fixed amount. 162. The German model has predictable costs for virtually all cost items (court costs, lawyers’ fees, and to a great extent for witness and expert costs). 63 It works particularly well for simple, lower value claims. It is, however, significant that it is less effective for more complex cases, and it is notable that larger commercial cases tend to use arbitration, within which greater access to documentary evidence can apply or be ordered by the arbitrator. 163. In contrast, the basic common law or English model produces unpredictable lawyers’ fees, but predictable court costs. This is because the amount of work done by the judges/courts is relatively predictable and so costable, whereas the amount of work done by lawyers is traditionally unpredictable. Indeed, the amount of work done by lawyers can vary widely between different type of cases, and in large cases can be huge (and far more than under the German system, where most of the work is done by the judge not by the lawyers). 63

G Wagner, ‘Litigation Costs and Their Recovery: The German Experience’ [2009] Civil Justice Quarterly 368.

41

164. In recent years, however, the ‘English model’ has splintered into a number of separate tracks, each with different rules on evidence, lawyers and costs: small claims, fast track cases, multi-track cases, and specialist courts. This trend towards particularisation is capable of producing both more predictable costs and lower costs. The trend appears to deserve close further attention.

(v) Settlement Considerations 165. The different architecture of differing civil procedure models is also one of the factors explaining a differing approach towards settlement of cases. In some systems, very few cases are settled between the parties, and the court is left to resolve the dispute by issuing a judgment: settlement rates quoted are Latvia 1-3 per cent, Italy 2 per cent but 60 per cent in commercial cases, Lithuania 10 per cent, Estonia 11 per cent. In other systems, settlement rates before judgment are notably high: Canada (as reported), Norway 42 per cent, Switzerland 60-80 per cent in commercial cases, Australia 90 per cent, Ireland 90 per cent, England 90 per cent, and Scotland 93 per cent. Obviously there are other factors explaining these rates, notably citizens’ prevailing expectations of the law (settlement of dispute by mutual compromise or by declaring one of the parties to be victorious). This, again, can be expected to be influenced by the overall level of costs of litigation in the respective country: if obtaining judgment is simply out of reach for most of the average citizen general expectations of the law will gradually change. 166. Under the common law system of proceeding towards a single final trial, the parties gain more information about the merits of the dispute, and face a gradual increase in costs, which usually escalate in relation to a trial. So a successive increase in costs should encourage settlement. Under the civil law procedure, the process does not end in a single trial, but there is one or perhaps a succession of short hearings, and the overall costs are lower than in the common law system. Such a system would not tend to have such strong pressure on settlement. If a claimant has paid the fee at the start, and both parties can predict what their costs and their financial risk is, particularly if it is low, and the process is the most speedy available, the balance of advantage may well lie in simply letting the court conclude the process and deliver a binding result. That attitude would avoid making the investment of effort, time and emotion in mediation or other settlement discussions. 167. The funding position and risk can clearly affect attitude to settlement. The Danish Report observes that almost all individuals have LEI or legal aid, hence they have no incentive to settle, and cases are usually not settled. On the other hand, businesses and individuals who self-fund have an incentive to settle, although in Denmark cases are often not settled once litigation commences. 168. However, the position is not always so simple as that. In some civil law systems, cases do settle during the process, and the court itself can facilitate this. Thus, judges

42

in Germany and the Netherlands, for example, can indicate their view of the merits of a case from the first hearing, and even put pressure on parties to settle. This is done frequently. Judges in Switzerland may positively propose settlements. Such intervention has pragmatic force. But many systems would regard it as a breach of the principle that a case will be decided by an impartial tribunal. That consideration would be important in systems that emphasise final determination by a judge, who does not make her mind up before having heard all the evidence at a final trial. 169. In some states, emphasis is placed on settling cases before they reach court. One example is Norway, where cases must first be made through the Conciliation Board before going to court. Another example is the English pre-action protocol system and costs rules. Similarly, a recent German reform requires mandatory mediation in some cases before court proceedings can be triggered.

(vi) Delivering Predictable and Proportionate Costs 170. Is it possible to identify the architecture or parameters of civil dispute resolution procedure that will produce costs that are predictable, proportionate and low? Based on the considerations discussed above, the conclusions appear to be: a. Ex ante control of costs is clearly preferable to ex post. b. A differential between own-lawyer costs and recoverable (shifted) costs (i.e. a recoverability gap) produces an incentive to encourage settlement. c. Settlement is a good idea if it can be done more cheaply and quickly than obtaining a binding decision. Whether this occurs can depend on the legal architecture. 171.

It would seem fruitful to consider the following issues: a. Can procedures be shortened and simplified? b. Who needs to do the essential work, and when? c. Can we predict the amount of work that needs to be done in certain types of case, and then fix a predictable cost for it (taking into account own-lawyer and shiftable costs)?

172. How can procedures be shortened? Civil procedure consists of certain essential steps: a. b. c. d.

Statement of the claim and damage Collection and evaluation of evidence Delivery of any technical expert opinion necessary Adjudication.

173. Onto those basic steps systems can build considerable complexity. The key issues are how much work needs to be put into definition of the legal issues and facts in

43

dispute, collection of evidence, obtaining of expert opinions, and legal analysis to deliver a judgment. Certain countries offer clearly attractive solutions to the most efficient delivery of these requirements. Thus, the German paradigm requires parties and lawyers to keep stage a short, and then places most of the work for stages b to d on the judge rather than the parties’ lawyers. That is clearly more efficient than a common law system in which stages b and c are undertaken by more than one person (sometimes many), and where the service suppliers can control the amount of work that they do. An interesting hybrid variation is that stage b is undertaken in Scotland by a court-appointed intermediary, rather than by the parties. That approach might be worth considering in common law systems, and research might define whether the amount of work is controlled by the service provider, or whether the culture is to focus on the essentials of the evidence or to adopt a comprehensive collection exercise. 174.

Some civil justice systems involve elements of cost that deserve close attention: a. How much documentary evidence is required? Perennial and loud complaints are heard about the extent and costs of discovery in the United States, especially because the cost cannot be shifted. b. Rights to appeal are widely available and widely used in some jurisdictions. Italy is a notorious example. If appeals were restricted, and less available in some jurisdictions by way of complete re-hearing, costs and duration would be reduced.

175. In looking at duplication of work, it might be asked whether, and in what circumstances, there is a need for more than one lawyer, such as the involvement of barristers and solicitors in a case. An argument can be made based on differences in specialization (such as elements of advocacy, project management, client relationship management, expert advice), but some civil justice systems involve far more lawyers than others. This area of cost deserves empirical and close attention. 176. Some modernisation of the process can be suggested that would lower costs. Service of process can be carried out by email or post, without the cost of any human actor. Simplified means of enforcement should be considered. 177. A powerful control on cost is to control the duration of cases. If lawyers are paid on an hourly rate basis, they will have opportunities to carry out work that is of peripheral value if there is an unnecessarily long delay before trial. Delay can also assist a party who has significant resources to run up costs so as to increase pressure of an opponent, unbalancing the playing field. It is these effects that case management could theoretically control, but has in practice – at least in England and Wales – rarely succeeded in controlling. Success in delivering short duration of litigation depends partly on availability and bureaucratic efficiency of judicial and administrative resources, and partly on the level of throughput volume in the court system that prevails at any given time. Either way, such matters are in the control of

44

governments, administrators and judges, rather than of parties. Delivering short durations should be a public priority. 178. To what extent is settlement desirable and, if so, how can it be promoted? Should there be an incentive for settlement, such as a rebate in the court fee? There are arguments of social cohesion in favouring agreement and reconciliation, which are important in certain types of cases, such as those involving family disputes and ongoing commercial relationships. But as Jackson LJ pointed out, mediation ‘is not a vehicle for establishing parties’ legal rights or a shortcut to arriving at correct legal solutions.’ 64 179. How can a case-type approach be taken further? There is considerable scope here. Socio-legal research in England 65 and Scotland 66 has looked at civil justice from the perspective of the types of legal problems that individuals have, and has identified different pathways to justice for different types of claims. A ‘pathway’ and ‘track’ approach has a number of attractions. The outcome should be that predictable costs should be definable in a number of case-types, and that the amount of work necessary can be limited. This may result in a shift in the procedure for such cases, involving reform of who does the work and when. This thinking underlay the 2008 Portuguese reforms after it had been recognized that half the cases in the courts were small debt cases. 180. For example, for more complex cases, is it right that more documentary evidence is needed in order to enable a just adjudication to be delivered? A move towards wider or more flexible evidence is discernable in the German finding that more complex cases tend to be dealt with not in the courts (which traditionally have limited disclosure) but in arbitration (which have wider and more flexible disclosure). A wider approach towards evidence necessarily involves greater cost for the parties. When would this be justified? 181. Hence, we propose to undertake further research into matching different types of legal problems with appropriate pathways, and considering what evidence a particular type of case might need, and how best this might be produced. Appropriate pathways may, of course, be not only through courts or tribunals but also through ombudsmen, compensation schemes, business codes of conduct and other alternative options. 182.

This approach should lead to a matrix, of which an example might be: i. Small claims – very low cost, informal swift procedure, no cost shifting. ii. Specialist tribunals (i.e. specialist non-court arenas, in which the decisionmakers have specialist knowledge, thereby largely removing the need for external expertise, and with the freedom to propose settlements and initiate mediated solutions) – a similar informal, low cost approach.

64

Jackson (n 4 above), 319. H Genn, Paths to Justice (Oxford, Hart Publishing, 1999). 66 H Genn and A Paterson, Paths to Justice in Scotland (Oxford, Hart Publishing, 2001). 65

45

iii. Fast track court process (for medium-sized claims) – fixed costs, relative speed, pre-action protocols governing standard work to be done and exchanged. The common law venues might investigate evidence collection by judges or commissioners. iv. Medium-sized commercial cases, especially involving SMEs – further work is needed to ensure streamlining, especially on intellectual property cases. Again, the German approach to judicial management may be attractive, or, in the common law world, strong judicial case management and cost budgets (the ‘Tonbridge Wells model’ quoted in the Jackson Review including cost capping intervention by the judge). Cost capping and sanctioning should be used. v. Heavy commercial cases – these typically rely on extensive evidence. Important issues remain unanswered here over the best procedure that marries justice and efficiency. Specialism may be important, for example in intellectual property, construction, financial, or other types. It may be possible to fit some expert input into the decision-making process, thereby reducing the need for the cost and delay of external expertise, by providing for an independent judge to have specialist knowledge in the area, and/or to sit with expert assessors, as in arbitration tribunals. 183. The clear conclusion here is that no ‘one size’ approach fits all types. The simple matrix suggested above is largely based on the size of the case, but it would seem equally relevant, if not more important, to produce a matrix based on the type of subject matter of cases. 184. Further, it is important that decisions should be based on appropriate empirical evidence, rather than untested theoretical assertions. For example, if it is right that a German approach works for smaller claims but not for larger claims, and an English approach works for larger claims, important issues arise that should be tested by empirical research, such as: a. In what types of case is it important for delivery of a just result that a judge should have available a certain amount of documentary evidence, and be able to cross-examine witnesses? Is there a distinction between these two notional types of cases, and does the dividing line depend on the amount of money at stake, the issues, or some other factor? Can the dividing line be identified in advance, or should it be a matter of decision, and if so by whom - the parties or a judge? b. In the area of larger and more complex claims, is it important in relation to the outcome whether evidence is identified and produced by the court or by the parties? 67 If the court (maybe through a commissioner) carries out this role, 67

Certain technological solutions should significantly assist parties and the court over the management of documentation, whoever collects documentary evidence. Hence, documents should be inserted as soon as possible into a single IT file jointly accessible by parties and the court. There should be no need for repeated photocopying and comparison of bundles. But the initial input cost must be low enough.

46

what effect does that have on the ability and timing of the parties to settle? Is production of documentary evidence cheaper if undertaken by the court, a commissioner, or the parties? Similar issues arise in relation to obtaining evidence from witnesses. 185. If certain evidence is needed, a question that arises is how and by whom it should be collected. The English approach is that the process is privatised, and the parties must do search for documents and interview witnesses. That system can involve extensive work for lawyers on both (or more) sides. The German approach is essentially that the parties produce documents on which they intend to rely and the court interviews witnesses and makes its own short summary of their evidence. That system clearly involves less effort, and is cheaper than the English system. The Scottish model is that documentary evidence not disclosed by the parties is recovered by a commissioner (an independent senior advocate). A similar approach (special master) can be used in the United States. That system may hold attractions in terms of efficiency. 186. One issue that merits further research is whether there is any difference in the justice of the outcomes of similar cases that are pursued through an English system with disclosure of documents or a German system of no or limited disclosure. 187. The EU has made various steps in the field of civil procedure. The existing measures are useful but perhaps tentative, notably: a. Jurisdiction and enforcement of judgments: Brussels Regulation b. Applicable law: Rome I and II regulations c. Taking evidence d. Small claims e. Mediation. However, the relatively recent measures on small claims and mediation are highly relevant as indicators of how the general level of consensus on dispute resolution is moving in Europe, and the application of an approach based on efficiency and accessibility, which are standard goals for the EU. 188. What is going to happen next? How should jurisdictions proceed? Is there a single recommendable approach? Or is diversification and experimentation desirable? What steps should governments and the European Commission take? 189. Do the interests of both consumers and business coincide, in seeking just, effective, speedy and cheap solutions to disputes? Do they care whether procedures are through courts or other pathways? Do people seek clarification of the law, resolution of disputes, or reconciliation? 190. Various lines of further research have been identified above, and one should not pre-empt any conclusions pending proper evidence. However, having had the advantage of considering all the information collected so far in this exercise, we are

47

bold enough to suggest how a principled solution for European jurisdictions might look: a. Court expenses should be payable by a claimant and counter-claimant, on a very simple basis of set fees. The fees would be based on recouping a percentage of the national courts’ budget, with the percentage set democratically so that an agreed division is made between costs to be funded from the state (i.e. shared between society) and to be paid by litigants. The fee structure should be as simple and transparent as possible, and avoid a succession of payments for different actions or stages. Some rebate could be made if a case settled before particular stages, so as to provide an incentive for swift settlement, but the economics of such a proposal need to be considered. In any event, the court fees need to be low, so as not to be a barrier to access to justice. b. Costs would be shifted to the losing party, unless there was good reason, based on convincing empirical evidence, for an exception in the particular circumstances of a type of case. All court costs would be shifted on the basis of the official tariff amounts paid initially by the instituting parties. Lawyers’ costs would be shifted on the basis of a set tariff, which might be zero for certain types of case (e.g. judicial review cases against the government, which pass a court certification stage and are therefore likely to have sufficient merit). Establishing the tariff should not be the task of lawyers or judges, but a transparent process involving independent participation by users, with democratic involvement. The reason for such independence is that a decision on proportionality is a socio-political judgment, unrelated to the amount of work that lawyers might suggest needs to be done. For those legal systems in which it may be difficult to establish a tariff for large cases, costs should be controlled as much ex ante as possible, by the judge establishing what work needs to be done (and not done) to lead to resolution, and approving cost budgets in advance, with strong case management. Thus, the judge would establish the level of shiftable costs as early as possible in a case, and also partially control own-party expenditure. Establishing transparency over the quantum of shiftable costs should assist earlier settlement. 191. Finally, we recommend that all governments should review whether the pathways that they provide to justice are appropriate and deliver outcomes that are just, costefficient, cost-proportionate, and speedy. The matrix of pathways should form a consistent whole. The procedure that is necessary within each pathway should be reviewed against the criteria of justice, efficiency, proportionality, and duration.

48

Appendix I. Questionnaire

Questionnaire on FUNDING, COSTS AND PROPORTIONALITY IN CIVIL JUSTICE SYSTEMS Please quote verbatim, or attach, all source documents.

1.

What are the costs incurred in civil litigation?

What do the parties (claimants, defendants etc, or persons acting on their behalf) have to pay to the following persons and institutions, and at what stage of the proceedings do they have to make such payments? 1.1 Court charges. 1.2 Other official charges (VAT, translator, bailiff, service or process, enforcement of a judgment). 1.3 Lawyers’ fees. Please cover all information on fee agreements, hourly rates, fixed fees, success fees, uplifts/contingency fees, pro bono, etc. and say how extensive each method is in practice, and what the size (or range) of fees are in each case. 1.4 A witness of fact. 1.5 An expert. 1.6 Any other costs. 1.7 What other factors constitute a “price” for bringing a claim, such as delays in the legal process, complex procedure, unpredictability of the outcome, opportunity cost, and other strains? How long do (different types of) cases usually take? For each item, please: (a) quote completely any law or guidance on the subject (general rules, reductions and exemptions), (b) say what rules apply in special cases, such as small claims, special courts/tribunals, (c) give (or estimate) any relevant actual amounts of money involved, and (d) say when the amount of money involved becomes clear to the payer.

49

2.

Who bears the costs?

How are the costs ultimately divided between the parties and/or others (the state etc)? Who reimburses/indemnifies/pays which of the items listed in paragraphs 1.1-1.7 above? Please identify: (a) What law or guidance exists? (b) What happens in practice? What percentage of costs ends up being paid by winner/loser/state/other? (c) When must payment be made? (d) When does an opponent receive information about the size of risk/actual amount of fees for which he might/does have to pay? 3.

What are the sources of finance for bringing or defending a legal claim?

What funding is permitted from each of the following sources? 3.1 Personal funds. 3.2 Legal aid. 3.3 Legal Expenses Insurance (LEI, i.e. before-the-event), for individuals or companies. 3.4 After-the-event (ATE) insurance. 3.5 Loans or grants from banks, trade associations, etc. 3.6 Funding from a lawyer or other third party investor. For each item, please (a) quote completely any law or guidance on the subject. (b) give or estimate any relevant actual amounts of money involved. (c) say how extensively each source of funding is available and used in practice. 4.

Further issues 4.1 How predictable are the amounts involved? 4.2 What strategies are used by the parties to lower costs (e.g. tactics in cases, or procedural options like budgets, cost capping orders, costs protection orders)? 4.3 How proportionate are the sums involved? 4.4 How long do the procedures take? 4.5 What proportion of cases is settled and how long do they take? 4.6 What figures (or estimates) are available on the numbers of civil litigation cases started, completed, or settled before judgment, for different available procedures, e.g. general courts, small claims, commercial or other special courts or tribunals, ombudsmen, special schemes, codes of business conduct, etc? Please give figures back to 2000 if available. 4.7 What restrictions apply to appeals? Are appeal courts bound by the findings of fact at first instance? What percentage of cases is appealed? How do the costs of an appeal compare to first instance? 4.8 What reforms can be recommended?

50

Case Studies Please give figures for the costs of claimant and defendant in the following examples, identifying when sums are related to a tariff or are open to be freely agreed. If a case would normally be resolved not by normal court process but by a different procedure (small claim, no fault compensation scheme, ombudsman, special court or tribunal, business scheme) please state or estimate the amount that such alternative procedure would cost. Please assume the most normal fee arrangement would apply for the claimant and defendant in each case (as most appropriate for the type of case), but please give some alternatives if ‘normal’ and success/contingency fees might apply. Assume each case goes all through the court process to a first judgment, and is not settled. In each case, state the total sum paid by claimant and defendant if (a) claimant wins and (b) defendant wins. If appropriate, give a range of costs where the case (a) is straightforward or (b) turns out to be more complex. Please give a summary (not exhaustive if the detail would be complex) that shows the calculations and assumptions. The objective is not to give definitive accuracy, but to give estimated ‘bottom line’ figures from which general comparisons between different costs systems in different countries can be made. 1. Small claim: repayment to a consumer of €200 price paid for product not delivered. 2. Family: divorce between husband on average income (say €50,000 pa), wife with no income, two children, living in an average home. 3. RTA: road traffic accident collision, in which the rear of the claimant’s car and the front of the defendant’s car are moderately damaged (i.e. rear and front respectively require total replacement panels, but engine is undamaged); cost of repair and replacement car €6,000. 4. Employment: wrongful loss of employment by a middle-ranging manager (say salary €50,000 pa). 5. Medical negligence: doctor’s error results in permanent (a) loss of ability to walk (b) paraplegia, for male claimant aged 25 on salary of €25,000 pa, no current dependents, but likelihood of marriage and two children. 6. SME: small company claim for unpaid debt of €8,000. 7. Large commercial case: substantial and complex breach of contract claim between two large companies over supply of defective machinery worth €2 million, with €5 million loss of profit.

51

8. Injunction – consumer: against neighbour to stop noise. 9. Injunction – commercial: prevent illegal breach of intellectual property in commercial information between two substantial companies. Questions for Scholars only a. Please give the background and historical context to the rules on funding and costs. What principles and theory apply? How do the rules on civil procedure or substantive law affect the current situation on funding and costs? b. Please give a critical review of the current position. Please identify general trends, unresolved or contentious issues, likely future reforms. Are the amounts of money involved predictable and proportionate? If not, how could they position be improved? Is settlement between the parties regarded as important, is settlement encouraged by the current system, and how might it be further promoted?

Thank you for completing this questionnaire

52

Appendix II. Contributors to the Comparative Study

Jurisdiction Austria

Australia Belgium Bulgaria Canada

China

Czech Republic

Denmark England & Wales Estonia

Finland

France Germany Greece Hong Kong Hungary

Scholar Prof. Dr. Georg E. Kodek, Wirtschaftsuniversität Wien Institut für Bürgerliches Recht und Handelsrecht, Wien Prof. Camille Cameron, Melbourne University Prof. Vincent Sagaert and Prof. Ilse Samoy, Catholic University of Leuven, Prof. Ognyan Stambouliev, Sofia University Prof. Janet Walker Osgoode Hall Law School of York University, Toronto and Asst. Prof. Erik S Knutsen, Queen's University Prof. Mike Palmer, SOAS London and Dr. Chao Xi, The Chinese University of Hong Kong Prof. doc. JUDr. Karel Klima, CSc, and Tomas Krivka, Western Bohemian University, Pilsen and Charles University, Prague Prof. Anders Ørgaard, Aalborg University Dr. Christopher Hodges, Centre for Socio-Legal Studies, Oxford Dr. Martin Käerdi, Tartu University and Raidla Lejins & Norcous Dr. Eva Storskrubb, Diottmar & Indrenius Prof. Dr. Loïc Cadiet, Paris University Prof. Dr. Burkhard Hess, Heidelberg University Prof. Konstantinos D. Klamaris, Athens University Prof. Chao Xi, Chinese University of Hong Kong Prof. Dr. Zsuzsa Wopera and Adrienn Nagy

53

Practitioner Daniela Karollous-Bruner, CMS Reich-Rohrwig Hainz

Stuart Clark & Colin Loveday, Clayton Utz André Lombart, CMS De Backer Kostadin Sirlestow, CMS Cameron McKenna

Ulrike Glueck, CMS Hasche Sigle Tomas Matejovsky and Kamila Rouckova, CMS Cameron McKenna

Jan-Erik Svensson, Gorrissen Federspiel Kierkegaard Guy Pendell, CMS Cameron McKenna Marit Toom, Raidla Lejins & Norcous Pekka Puhakka, Asianajotoimisto Hammarström Puhakka Partners Oy Anne-Laure Villedieu, CMS Bureau Francis Lefebvre Michael Molitoris, Nörr Stiefenhoffer Lutz Dimitris Emvalomenos, Bahas, Gramatidis & Partners Robert Clark and Karen Dicks, Deacons Milan Kohlrusz, CMS Cameron McKenna

University of Miskolc Ireland Italy

Prof. Dr. Elisabetta Silvestri, Pavia University

Japan

Prof. Ikuo Sugawara, Nagoya University & Prof. Eri Osaka, Surugadai University

Latin America Latvia

Prof. Manuel Gomez, Florida University Prof. Dr. Kalvis Torgans, Latvia University Dr. Rimantas Simaitis Vilnius University Prof. mr. Carla.J.M. Klaassen, Radboud University Sverre Blandhol, Oslo University

Lithuania Netherlands Norway Poland Portugal

Prof. Jeffrey Pinsler, Singapore University Prof. Aránzazu Calzadilla Medina, Universidad de La Laguna

Toomas Vaher, Raidla & Partners, Tallinn Dr. Rimantas Simaitis Raidla Lejins & Norcous Leonard Böhmer, CMS Derks Star Busmann NV Magnus Hellesylt, Wiersholm, Mellbye & Bech Pawel Pietkiewicz, CMS Cameron McKenna Margarida Barrocas, Barrocas Sarmento Neves Gabriel Sidere, CMS Cameron McKenna Leonid Zubarev and Sergei Yuriev, CMS Cameron McKenna Rob Wilson, CMS Cameron McKenna Lawrence Teh and Wendy Goh, Rodyk & Davidson Alejandro Ferreres, Uría Menéndez

Prof. Dr. Walter Stoffel, Fribourg University Professor Kuan-Ling Shen National Taiwan University Prof. Deborah Hensler, Stanford University

Peder Hammarskiöld & Sofia Englund, Advokatfirman Hammarskiöld & Co Philipp Dickenmann, CMS von Erlach Henrici AG Helena Chen, FBLAW Michael Hausfeld, Hausfeld LLP

Dr. Magdalena Tulibacka, Centre for Socio-Legal Studies, Oxford Prof.Henrique Antunes, Catholic University of Lisboa

Romania Russia

Prof. Dimitri Maleshin, Moscow University

Scotland Singapore Spain

Sweden

Switzerland Taiwan USA

Stuart Margetson & Lisa Broderick, Matheson Ormsby Prentice Laura Opilio & Paola Ghezzi, CMS Adonnino Ascoli & Cavasola Scamoni Teruoki Ninomiya, Research and Training Institute of the Japanese Supreme Court

54

Appendix III. Ranges of Lawyers’ Hourly Rates Country

Fee in local currency (if different to Euros)

Fee in Euros 68

No hourly rates in report – tariff system

Austria Australia Belgium Bulgaria

150 - 600

86,02 – 344,07

60

30,69

Canada China Czech Republic

125 - 900 3.000

77 - 554 312,03

Denmark England and Wales

1.000 – 3.750 109 - 402

134,33 – 503,74 128,10 – 472,43

Estonia Finland France

64 - 128 150 – 400 220 - 500

Germany Greece Hong Kong Hungary Ireland Italy Japan Latvia Lithuania

Netherlands Norway

Poland Portugal Romania Russia Scotland

Additional remarks

No fees in report Normally fixed fees are used, not hourly fees Maximum amount No hourly rates in report – tariff system is popular Fee depends on seniority of lawyer and location of law firm Average amounts Average amounts Amounts depend on the area of law, urgency, and location of law firm No hourly rates in report – tariff system No hourly rates in report – tariff system No amounts in report

80 - 500 25 - 665 20.000 – 100.000 20 - 300 51 – 831 LTL

1000 – 4000 + VAT (25%), so 1250 - 5000 100 – 400

147,81 – 738,99 28,60 - 429 15 - 250

No amounts in report UNCLEAR if these are hourly fees or fees per activity. Tokyo rates Lawyers also sometimes agree a ‘per case’ fee. Contingency fees are allowed.

75 - 700 138,49 – 553,95

Singapore Spain Sweden

100 – 1000 1.104

22,28 – 89,13 60 - 300 350 300 69 – 169 (149 Average) 48,86 – 488,60 94,50 – 252 101,81

Switzerland

350 - 600

229,37 – 393,28

Taiwan USA

68

Average amounts Depending on seniority Maximum amount – can be lower Average amount

Official government rate for legal aid purposes Rates for major commercial firms in Zurich No amounts in report No amounts in report

Conversion rates as per 30 June 2009 at: http://www.xe.com/ucc/convert.cgi. Figures not adjusted according to national purchasing power.

55

Hourly rates, ranked by lowest Country Lithuania Poland Italy Latvia Bulgaria Singapore Portugal Estonia Scotland Netherlands Canada Hungary Australia Spain Sweden England and Wales Denmark Norway Japan Finland France Switzerland Russia China Romania

69

Fee in Euros 69 15 - 250 22 - 89 25 - 665 28 - 429 30 48 - 488 60 - 300 64 - 128 69 - 169 75 - 700 77 - 554 80 - 500 86 - 344 94,50 - 252 101 128- 472 134 - 503 138 - 553 147 - 738 150 - 400 220 - 500 229 - 393 300 312 350

Conversion rates as per 30 June 2009 at: http://www.xe.com/ucc/convert.cgi.

56

Hourly rates, ranked by highest Country Bulgaria Poland Sweden Estonia Scotland Lithuania Spain Russia Portugal China Australia Romania Switzerland Finland Latvia England and Wales Singapore Hungary France Denmark Norway Canada Italy Netherlands Japan

70

Fee in Euros 70 30 22 - 89 101 64 - 128 69 - 169 15 - 250 94,50 - 252 300 60 - 300 312 86 - 344 350 229 - 393 150 - 400 28 - 429 128 - 472 48 - 488 80 - 500 220 - 500 134 - 503 138 - 553 77 - 554 25 - 665 75 - 700 147 - 738

Conversion rates as per 30 June 2009 at: http://www.xe.com/ucc/convert.cgi.

57

Appendix IV. Case Studies Minimum costs risk for claimant – USD International (PPP) Comparative Table Country 71

Australia

Austria

Case Study 1

Case Study 2

Case Study 3

Case Study 4

Case Study 5

Case Study 6

Case Study 7

Case Study Case Study 8 9

Lawyers fees: 3.500 AUD (2.380,95 USD Intl.) Court fees: 77 AUD (52,38 USD Intl.)

Lawyers fees: 5.000 AUD (3.401,36 USD Intl.) Court fees: 835 AUD (568,02 USD Intl.)

Lawyers fees: 5000 AUD (3.401,36 USD Intl.) Court fees: 198 AUD (134,69 USD Intl.)

Lawyers fees: Court fees: Not specified 72

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified;

Lawyers fees: Court fees: Not specified;

TOTAL: 11.416,06 Euros

TOTAL: 114.160,58

Lawyers fees: 2500 AUD (1.700,68 USD Intl.) Court fees: 77 AUD (52,38 USD Intl.)

TOTAL: 2.433,33 USD Intl.

TOTAL: 3.969,38 USD Intl.

TOTAL: 3.536,05 USD Intl.

Lawyers fees: 569,40 Euro (+ freely agreed fee) (662,09

Lawyers fees: 1.363,10 Euro (+ freely agreed fee)

Lawyers fees: 1702,80 Euros (+ freely agreed fee)

TOTAL: 57080,29 Euros

TOTAL: 5708,02 Euros

Lawyers fees: Court fees: Not specified; TOTAL: 11416,06 Euros

TOTAL: 1.753,06 USD Intl.

Lawyers fees: Court fees: Not specified

Lawyers fees: 27.052 Euro (+ freely agreed fee) (31.455,81

71

Lawyers fees: 3.093,60 Euro (+ freely agreed fee)

Lawyers fees: 111.463,25 Euro (+ freely agreed fee) (129.608,43 USD Intl.)

Lawyers fees: 683,80 Euro (+ freely agreed fee) (795,11 USD Intl.)

Lawyers fees: 6.786,30 Euro (7.891,04 USD Intl.) Court fees: 607 Euro

Amounts here do not include VAT. Conversion rates as per 20 July 2009, unless otherwise indicated. ‘Not specified’ – indicates that costs have not been quoted in the answer. ‘Not specific enough’ – indicates that costs have been quoted but have not been itemized. 72

58

USD Intl.) Court fees: 37 Euro (43,52 USD Intl.)

(1.585,00 USD Intl.) Court fees: 210 Euro (244,18 USD Intl.)

TOTAL: 705,61 USD TOTAL: Intl. 1.829,18 USD Intl.

Belgium

Bulgaria

Lawyers fees: Court fees: Not specified Lawyers fees: 100 BGL (138,88 USD Intl.) Court fees: 50 BGL (69,44 USD Intl.)

Lawyers fees: Court fees: Not specified Lawyers fees: 300 BGL (416,66 USD Intl.) Court fees: 50 BGL (69,44 USD Intl.)

(1.980,00 USD Intl.) Court fees: 257 Euro (298,83 USD Intl.) TOTAL: 2.278,83 USD Intl.

USD Intl.) Court fees: 8861 Euro (assuming that the case value is 600.000 Euro) (10.303,48 USD Intl.)

Lawyers fees: Court fees: Not specified Lawyers fees: 690 BGL (958,33 USD Intl.) Court fees: 480 BGL (666,66 USD Intl.)

TOTAL: 41.759,29 USD Intl. Lawyers fees: Court fees: Not specified Lawyers fees: 4.450 BGL (6.180,55 USD Intl.) Court fees: 8000 BGL (11.111,11 USD Intl.)

TOTAL: TOTAL: TOTAL: 208,32 USD 486,10 USD 1.624,99

Lawyers fees: Court fees: Not specified Lawyers fees: 2.450 BGL (3.402,77 USD Intl.) Court fees: 4.000 BGL (ONLY IF MANAGEM ENT CONTRACT TOTAL: – OTHER17.291,66

59

(3.597,20 USD Intl.) Court fees: 607 Euro (705,81 USD Intl.) TOTAL: 4.303,01 USD Intl.

Lawyers fees: Court fees: Not specified Lawyers fees: 770 BGL (1.069,44 USD Intl.) Court fees: 640 BGL (888,88 USD Intl.) TOTAL: 1.958,32

Court fees: 85.661 Euro (99.605,81 USD Intl.)

Court fees: 52 Euro (60,46 USD Intl.)

TOTAL: 229.214,24 USD Intl.

TOTAL: 855.57 USD Intl.

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

Lawyers fees: 200.450 BGL (278.402,77 USD Intl.) Court fees: 200.000 BGL (277,777,77 USD Intl.)

Lawyers fees: 150 BGL (208,33 USD Intl.) Court fees: 30 BGL (41,66 USD Intl.)

Lawyers fees: Court fees: NO ANSWER TO THIS CASE STUDY

TOTAL: 556.188,54 USD Intl.

TOTAL: Uncertain

(705,81 USD Intl.) TOTAL: 8.596,85 USD Intl.

Intl.

China 73

Lawyers fees: 180 CNY (46,51 USD Intl.) Court fees: 50 CNY (12,91 USD Intl.)

Intl.

Lawyers fees: DEPEND ON CASE VALUE Court fees: 50 CNY Not specific enough

TOTAL: 59,42 USD Intl.

Czech Republic

Lawyers fees: 4.590,29 CZK (180 Euro) (325,78 USD Intl.) 73

USD Intl.

Lawyers fees: 1.620 CNY (418,60 USD Intl.) Court fees: 1.150 CNY (297,15 USD Intl.)

WISE FREE) USD Intl. (5.555.55 USD Intl.) TOTAL: 8.958,32 USD Intl. Lawyers fees: 1500 Euro (14,957.21 CNY) 3862,92 USD Intl. Court fees: 10 CNY (2,58 USD Intl.)

Lawyers fees: Court fees: No amounts in answer

TOTAL: 715,75 USD TOTAL: Intl. 3865,50 USD Intl. Lawyers fees: 1.530,10 CZK (60 Euro) (108,59 USD Intl.)

Lawyers fees: 7.395,47 CZK (290 Euro) (524,87 USD Intl.)

Lawyers fees: 41.822,68 CZK (1640 Euro) (2.968,25 USD Intl.)

USD Intl.

Lawyers fees: 2.160 CNY (558,13 USD Intl.) Court fees: 1.600 CNY (413,43 USD Intl.)

Lawyers fees: 1.350.000 CNY (348.837,20 USD Intl.) Court fees: 266.800 CNY (68.940,56 USD Intl.)

TOTAL: TOTAL: 971,56 USD 417.777,76 Intl. USD Intl.

Lawyers fees: 63.754,08 CZK (2500 Euro) (4.524,77 USD Intl.)

Italics – if checked with national correspondent and amended!

60

Lawyers fees: 6.120,39 CZK (240 Euro) (434,37 USD Intl.)

Lawyers fees: 119.857,68 CZK (4700 Euro) (8.506,57 USD Intl.) Court fees:

Lawyers fees: 5000 CNY (1.291,98 USD Intl.) Court fees: 50 CNY (12,91 USD Intl.)

Lawyers fees: Not specified (Depend on value of case, otherwise hourly) Court fees: 500 CNY (129,19 USD Intl.)

TOTAL: 1.304,89 USD Intl.

TOTAL: Uncertain

Lawyers fees: 943,56 CZK (37 Euro) (66,96 USD Intl.) Court fees: 3.060,20 CZK

Lawyers fees: 6.375,41 CZK (250 Euro) (452,47 USD Intl.) Court fees: 943,56 CZK

Denmark

Court fees: 12.750,82 CZK (500 Euro) (904,95 USD Intl.)

Court fees: 8.160,52 CZK (320 Euro) (579,17 USD Intl.)

TOTAL: TOTAL: TOTAL: 367,40 USD TOTAL: 959,24 USD 3.873,20 Intl. 150,21 USD Intl. USD Intl. Intl.

TOTAL: 13.936,30 USD Intl.

TOTAL: 1.013,54 USD Intl.

Lawyers fees: 10.500 DKK (1.233,84 USD Intl.) Court fees: 500 DKK (58,75 USD Intl.)

Lawyers fees: 27.500 DKK (3.231,49 USD Intl.) Court fees: 22.400 DKK (2.632,19 USD Intl.)

Lawyers fees: 11.000 DKK (1.292,59 USD Intl.) Court fees: 1.249 DKK (146,76 USD Intl.)

Lawyers fees: 1.000.000 DKK (117.508,81 USD Intl.) Court fees: 150.000 DKK (17.626,32 USD Intl.)

TOTAL: 1.439,35 USD Intl.

TOTAL: 135.135,13 USD Intl.

Lawyers fees: 0 Court fees: 925 GBP

Lawyers fees: 1.000.000 GBP Court fees:

TOTAL: 1.292,59 USD Intl.

England and Wales

Court fees: 6.120,39 CZK (240 Euro) (434,37 USD Intl.)

Court fees: 132.608,49 CZK (5200 Euro) (9.411,53 USD Intl.)

Court fees: 586,54 CZK (23 Euro) (41,62 USD Intl.)

Lawyers fees: 50 GBP (75,75 USD Intl.)

Court fees: 586,54 CZK (23 Euro) (41,62 USD Intl.)

Lawyers fees: 15.000 DKK (1.762,63 USD Intl.) Court fees: 0 TOTAL: 1.762,63 USD Intl.

Lawyers fees: 1000 Court fees: 340

Lawyers fees: 12.000 DKK (1.410 USD Intl.) Court fees: 1.000 DKK (117,50 USD Intl.)

Lawyers fees: 11.000 DKK (1.292,59 USD Intl.) Court fees: 1.600 DKK (188,01 USD Intl.)

TOTAL: 1.527,50 USD Intl.

TOTAL: Uncertain

Lawyers fees: 12.000 GBP (solicitors

Lawyers fees: Court fees: ANSWER is

TOTAL: 5.863,68 USD Intl. Lawyers fees: 100.000 Court fees:

61

943.560,44 CZK (37000 Euro) (66.966,67 USD Intl.) TOTAL: 75.473,24 USD Intl.

(120 Euro) (217,18 USD Intl.)

(37 Euro) (66,96 USD Intl.)

TOTAL: 284,14 USD Intl.

TOTAL: 519,43 USD Intl.

Lawyers fees: Court fees: NOT A CIVIL CASE - NO DETAILS

Lawyers fees: 1.000.000 DKK (117.508,81 USD Intl.) Court fees: 150.000 DKK (17.626,32 USD Intl.) TOTAL: 135.135,13 USD Intl.

Lawyers fees: Not Specified Court fees: 265 GBP

Lawyers fees: 50.000 GBP (75.757,57 USD Intl.)

Court fees: 55 GBP (83,33 USD Intl.)

TOTAL: 1340 GBP, 877,70 USD Intl.

TOTAL: 159,08 USD Intl.

Estonia

Lawyers fees: 2.002,77 EEK (128 Euro) (220,56 USD Intl.) Court fees: 1.001,38 EEK (64 Euro) (110,28

Lawyers fees: 4.897,40 EEK (313 Euro) (539,36 USD Intl.) Court fees: 5.006,92 EEK (320 Euro) (551,42

and barristers’ fees, both acting on a CFA basis – otherwise half the amount) + 2500 disbursemen ts Court fees: 0 TOTAL: 14.500 GBP, 9497,50 USD Intl. Lawyers fees: 62.586,56 EEK (4000 Euro) (6.892,79 USD Intl.) Court fees: 9.998,20 EEK (639 Euro) (1.101,12

not precise enough – costs between 5.000 and 70.000 GBP

2830

Lawyers fees: 9.998,20 EEK (639 Euro) (1.101,12 USD Intl.) Court fees: 0

Lawyers fees: 19.996,41 EEK (1278 Euro) (2.202,24 USD Intl.) Court fees: 0

TOTAL: 1.101,12 USD Intl.

TOTAL: 67.353,65 USD Intl.

TOTAL: 2.202,24

62

(1.401,51 USD Intl.)

2.032,20 GBP

TOTAL: 1.401,51 USD Intl.

TOTAL: 1.002.032,20 GBP, 656.331,09 USD Intl.

Lawyers fees: 19.996,41 EEK (1278 Euro) (2.202,24 USD Intl.) Court fees: 15.005,13 EEK (959 Euro) (1.652,54

Lawyers fees: 199.995,35 EEK (12782 Euro) (22.025,91 USD Intl.) Court fees: 1.499.996,44 EEK (95867 Euro) (165.197,84 USD Intl.)

(401,51 USD Intl.) TOTAL: Uncertain

Court fees: 515 GBP (780,30 USD Intl.) TOTAL: 73537,87 USD Intl.

Lawyers fees: 4.991,28 EEK (319 Euro) (549,70 USD Intl.) Court fees: 4.991,28 EEK (319 Euro) (549,70 USD Intl.)

Lawyers fees: 49.991,01 EEK (3195 Euro) (5.505,61 USD Intl.) Court fees: 4.991,28 EEK (319 Euro) (549,70 USD Intl.)

TOTAL:

TOTAL:

USD Intl.)

Finland

France

USD Intl.)

USD Intl.)

USD Intl.) TOTAL: 187.223,75 USD Intl.

1099,40 USD Intl.

6055,31 USD Intl.

TOTAL: TOTAL: 330,84 USD 1.090,78 Intl. USD Intl.

TOTAL: 7.993,91 USD Intl.

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified – settled by insurance

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

Lawyers fees: Not specific Court fees: 0

Lawyers fees: 0 Court fees: 0

Lawyers fees: 30.000 Euro (32.967,03 USD Intl.) Court fees: 0

Lawyers fees: Court fees: Not specific

Lawyers fees: Court fees: No costs in answer

Lawyers fees: Not specific Court fees: 0

Lawyers fees: Court fees: No costs in answer

Lawyers fees:

Lawyers fees: Lawyers fees: 66.949,40 Euro Court fees:

Lawyers fees: Court fees:

Lawyers fees: 0 Court fees: 0

Lawyers fees: Depending on complexity. Court fees: 79 Euros (86,43 USD Intl.) TOTAL: Uncertain Lawyers fees: Not specific Court fees: 0

TOTAL: 0 Euro

Germany

USD Intl.

Lawyers fees: 89,25

Lawyers fees:

Lawyers fees:

TOTAL: 3.854,78 USD Intl.

TOTAL: 0 Euro

Lawyers fees:

TOTAL: 32.967,03 USD Intl. Lawyers fees: 4.086

63

Euro (106,25 USD Intl.) Court fees: 75 Euro (89,28 USD Intl.)

Greece

Hong Kong

1.588,65 Euro (1.891,25 USD Intl.) Court fees: 119 Euro (141,66 USD Intl.)

1.029,35 Euro (1.225,41 USD Intl.) Court fees: 408 Euro (485,71 USD Intl.)

1.588,65 Euro (1.891,25 USD Intl.) Court fees: 438 Euro (521,42 USD Intl.)

TOTAL: 195,53 USD TOTAL: Intl.) 2.032,91 USD Intl.

TOTAL: 1.711,12 USD Intl.

TOTAL: 2.412,67 USD Intl.

Lawyers fees: 64 Euro (88,88 USD Intl.) Court fees: 5,50 Euro (7,63 USD Intl.)

Lawyers fees: 321 Euro (445,83 USD Intl.) Court fees: 5 Euro (6.94 USD Intl.)

Lawyers fees: 170 Euro (236,11 USD Intl.) Court fees: 46 Euro (63,88 USD Intl.)

Lawyers fees: 508 Euro (705,55 USD Intl.)

TOTAL: 96,51 USD Intl.

TOTAL: TOTAL: 452,77 USD 299,99 USD TOTAL: Intl. Intl. 1.230,55 USD Intl.

TOTAL: 1.677,77 USD Intl.

Lawyers fees: Court fees:

Lawyers fees: Court fees:

Lawyers fees: Court fees:

Lawyers fees: Court fees:

Court fees: 378 Euro (525,00 USD Intl.)

Lawyers fees: Court fees:

Euro (4.864,28 USD Intl.) Court fees: 2.568 Euro (3.057,14 USD Intl.) TOTAL: 7.921,42 USD Intl.

Lawyers fees: 508 Euro (705,55 USD Intl.) Court fees: 700 Euro (972,22 USD Intl.)

64

1.249,50 Euro (1.487,50 USD Intl.) Court fees: 498 Euro (592,85 USD Intl.) TOTAL: 2.080,35 USD Intl. Lawyers fees: 197 Euro (237,61 USD Intl.) Court fees: 60 Euro (83,33 USD Intl.) TOTAL: 320,94 USD Intl. Lawyers fees: 0 Court fees:

(79,701,66 USD Intl.) Court fees: 67.368 Euro (80.200,00 USD Intl.)

No amounts in answer (Depending on specific circumstances )

No amounts in answer (Depending on specific circumstances)

Lawyers fees: 2.466 Euro (3.425,00 USD Intl.) Court fees: 48.655 Euro (67,57 USD Intl.)

Lawyers fees: 343 Euro (476,38 USD Intl.) Court fees: 5 Euro (6.94 USD Intl.)

Lawyers fees: 343 Euro (476,38 USD Intl.) Court fees: 5 Euro (6.94 USD Intl.)

TOTAL: 3.492,57 USD Intl.

TOTAL: 483.32 USD Intl.

TOTAL: 483,32 USD Intl.

Lawyers fees: Court fees: Costs are not

Lawyers fees: Court fees: Costs are not

Lawyers fees: Court fees: Costs are not

TOTAL: 159.901,66 USD Intl.

‘Minimal’

Hungary

Lawyers fees: 589.438,42 HUF (2.200 Euro) (4.232,64 USD Intl.) Court fees: 6.162,31 HUF (23 Euro) (44,25 USD Intl.) TOTAL: 4.276,89 USD Intl.

Ireland

Lawyers fees: 0 Court fees: 0 TOTAL: 0

Costs are not specified Lawyers fees: 1.232.462,1 5 HUF (4.600 Euro) (8.850,08 USD Intl.) Court fees: 10.717,06 HUF (40 Euro) (76,95 USD Intl.) TOTAL: 8.927,03 USD Intl.

Lawyers fees: Court fees: Not specified

Costs are not specified Lawyers fees: 803.779,66 HUF (3.000 Euro) (5771,79 USD Intl.) Court fees: 96.453,56 HUF (360 Euro) (692,61 USD Intl.)

‘Minimal’

Costs are not specified Lawyers Lawyers fees: 4000 fees: Euros 1.232.462,1 Court fees: 0 5 HUF NOTE: state (4.600 Euro) advances claimants (8.850,08 costs (then USD Intl.) Court fees: loser pays) 10.717,06 HUF (40 TOTAL: 4000 Euros, Euro) 148.678,15 (76,95 USD USD Intl. Intl.)

TOTAL: 6.464,40 USD Intl.

Lawyers fees: 1100 Euro (1.157,89 USD Intl.) Court fees: 63,49 Euro

Lawyers fees: Court fees: Not specified

0

specified

specified

specified

TOTAL: 0 Lawyers fees: 2.143.412,4 3 HUF (8.000 Euro) (15.391,44 USD Intl.) Court fees: 128.604,75 HUF (480 Euro) (923,48 USD Intl.)

Lawyers fees: 80.377.965,99 HUF (300.000 Euro) (577.179,13 USD Intl.) Court fees: 803.779,66 HUF (3.000 Euro) + Expert fee of 4000 Euro (5.771,79 USD Intl.)

Lawyers fees: 267.926,55 HUF (1.000 Euro) (1.923,93 USD Intl.) Court fees: 2.116,62 HUF (7,90 Euro) (15,19 USD Intl.)

Lawyers fees: 1.607.559.32 HUF (6.000 Euro) (11.543,58 USD Intl.) Court fees: 18.754,86 HUF (70 Euro) (134,67 USD Intl.)

TOTAL: 322.452,86 HUF, 44.904.785,28 USD Intl.

TOTAL: 1.619.937,30 HUF, 225.592.468,4 0 USD Intl.

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

TOTAL: 8.927,03 USD Intl.

TOTAL: 16.314,92 USD Intl.

TOTAL: 81.954,21 HUF, 82.093,47 USD Intl.

Lawyers fees: Court fees: Not specified

Lawyers fees: 1500 Euro (1.578,94 USD Intl.) Court fees: 500 Euro

Lawyers fees: Court fees: Not specified

65

Japan

Lawyers fees: 5.250 JPY (45,02 USD Intl.) Court fees: 4.910 JPY (42,10 USD Intl.) TOTAL: 87,12 USD Intl.

Latvia

Lawyers fees: Not specified Court fees: 50,19 LVL (71 Euro) (122,41 USD Intl.)

(66,83 USD Intl.)

(526,31 USD Intl.)

TOTAL: 1.224,72 USD Intl.

TOTAL: 2.105,25 USD Intl.

Lawyers fees: 400.000 JPY (3.430,53 USD Intl.) Court fees: 19.400 JPY (166,38 USD Intl.)

Lawyers fees: 270.000 JPY (2.315,60 USD Intl.) Court fees: 15.000 JPY (128,64 USD Intl.)

Lawyers fees: 1.100.000 JPY (9.433,96 USD Intl.) Court fees: 21.400 JPY (183,53 USD Intl.)

TOTAL: 3.596,91 USD Intl.

TOTAL: 2.444,24 USD Intl.

TOTAL: 9.617,49 USD Intl.

Lawyers fees: Not specified Court fees: 101,09 LVL (143 Euro) (246,56 USD Intl.)

Lawyers fees: Not specified Court fees: 243,88 LVL (345 Euro) (594,82 USD Intl.)

Lawyers fees: Court fees: Not specified

Lawyers fees: 9.500.000 JPY (81.475,12 USD Intl.) Court fees: 314.400 JPY (2.696,39 USD Intl.) TOTAL: 84.171,51 USD Intl. Lawyers fees: Court fees: Not specified

Lawyers fees: 300.000 JPY (2.572,89 USD Intl.) Court fees: 17.400 JPY (149,22 USD Intl.) TOTAL: 2.722,11 USD Intl. Lawyers fees: Not specified Court fees: 285,59 LVL (404 Euro) (696,56 USD Intl.)

Lawyers fees: 50.000.000 JPY (428.816,46 USD Intl.) Court fees: 1.976.400 JPY (16.950,25 USD Intl.) TOTAL: 445.766,71 USD Intl.

Lawyers fees: Not specified Court fees: 4.727,06 LVL (6.687 Euro) (11.529,41 USD Intl.) TOTAL:

66

Lawyers fees: 700.000 JPY (6.003,43 USD Intl.) Court fees: 19.400 JPY (166,38 USD Intl.)

Lawyers fees: Court fees: ‘Not possible to calculate costs’

TOTAL: 6.169,81 USD Intl.

Lawyers fees: Court fees: Administrativ e procedure used

Lawyers fees: Court fees: 50,19 LVL (71 Euro) (122,41 USD Intl.) TOTAL: Uncertain

TOTAL: Uncertain

TOTAL: Uncertain

Lawyers fees: 145 Euro Court fees: 20,50 Euro TOTAL: 165,50 Euro (571,44 LTL – 1051,45 USD Intl.)

Lawyers fees: 232 – 869 Euro; Court fees: 14 Euro (postage) + no need to pay if consent; otherwise 3% of estate

Lawyers fees: 435 – 580 Euro Court fees: 180 (Stamp duty) + 290 Euro (expert fee)

Netherlan Lawyers ds fees: 0 Court fees: 100 Euro (229,88 USD Intl.)

Lawyers fees: Court fees: Not specific

Lawyers fees: Court fees: Not specific

TOTAL: Uncertain Lithuania

TOTAL: 3124,78 LTL TOTAL: min (5749,60 246 Euro = USD Intl.) 849,39 LTL (1562,88 USD Intl.)

Lawyers fees: 580 – 870 Euros Court fees: None

Lawyers fees: 435 – 580 Euro Court fees: None

TOTAL: Uncertain

Uncertain

Lawyers fees: 435 – 580 Euros Court fees: 240 Euros

Lawyers fees: 5792 – 11585 Euros Court fees: 8689 Euros (stamp duty)

TOTAL: min 2002,62 LTL (3684,82 USD Intl.)

TOTAL: min 1501,97 LTL (2763,62 USD Intl.)

TOTAL: min 675 Euros = 2330,64 LTL (4288,38 USD Intl.)

Lawyers fees: Court fees: Not specific

Lawyers fees: Court fees: Not specific

Lawyers fees: Court fees: Not specified

TOTAL: 174,80 USD

67

TOTAL: min 14481 Euros; 50.000 LTL (92000 USD Intl.)

Lawyers fees: Court fees: Not specified

Lawyers fees: 290 Euros Court fees: 29 Euros TOTAL: 319 Euros (1104,44 LTL = 2026,65 USD Intl.)

Lawyers fees: Court fees: Not specified

Lawyers fees: 2896 – 5792 Euros Court fees: 29 Euros TOTAL: min 2925 Euros (10.099,44 LTL = 18.582,97 USD Intl.)

Lawyers fees: Court fees: Not specified

Norway

Intl. Lawyers fees: 360 NOK (39,43 USD Intl.) Court fees: 3.010 NOK (329,68 USD Intl.)

Lawyers fees: Court fees: Administra tive route!

Lawyers fees: Court fees: Insurance route!

Lawyers fees: Court fees: Not specific

TOTAL: 369,11 USD Intl.

Poland

Lawyers fees: min 40 Euros Court fees: 10 Euros TOTAL: 50 Euros, 209,42 PLN (Rates per 23 Sep 09), 411,09 USD Intl.

Lawyers fees: 30.000 NOK (3.285,87 USD Intl.) Court fees: 4.300 NOK (470,97 USD Intl.) TOTAL: 3.756,84 USD Intl.

Lawyers fees: min 80 Euros Court fees: 130 Euros TOTAL: 210 Euros, 881,08 PLN 1729,56 USD Intl.

Lawyers fees: min 550 Euros Court fees: 300 + 70 (expert) TOTAL: 920 Euros, 3857,54 PLN; 7572,35 USD Intl.

Lawyers fees: min 550 Euros Court fees: none TOTAL: 550 Euros; 2307,95 PLN; 4534,43 USD Intl.

Lawyers fees: min 1600 Euros Court fees: 22.250 Euros + 1200 Expert fee TOTAL: 25.050 Euros; 105.121,89 PLN; 206.354,37 USD Intl.

68

Lawyers fees: “up to 25.000 NOK (2.738,22 USD Intl.) Court fees: 3.010 NOK (329,68 USD Intl.)

Lawyers fees: Not specified Court fees: 4.300 NOK (470,97 USD Intl.)

Lawyers fees: Not specified Court fees: 4.300 NOK (470,97 USD Intl.)

Lawyers fees: Not specified Court fees: 4.300 NOK (470,97 USD Intl.)

TOTAL: Uncertain

TOTAL: Uncertain

TOTAL: Uncertain

Lawyers fees: min 1600 Euros Court fees: 22.250 Euros

Lawyers fees: min 40 Euros Court fees: 50 Euros

Lawyers fees: min 130 Euros Court fees: 130 Euros + 1200 expert fee

TOTAL: Uncertain Lawyers fees: min 1600 Euros Court fees: 400 Euros TOTAL: Min 2000 Euros; 8393,62 PLN; 16.476,67 USD Intl.

TOTAL: 23.850 Euros; 100.135,25 PLN; 196.565,50 USD Intl.

TOTAL: 90 Euros; 377,95 PLN; 741,92 USD Intl.

TOTAL: min 1460 Euros; 6126,17 PLN; 12.025,67 USD Intl.

Portugal

Romania

Lawyers fees: 0 Court fees: 72 Euro (102,85 USD Intl.)

Lawyers fees: 250 Euro (357,14 USD Intl.) Court fees: 396 Euro TOTAL: (565,71 102,85 USD USD Intl.) Intl. TOTAL: 922,85 USD Intl.

Lawyers fees: 500 – 1000 Euros (min 349,50 USD Intl.) Court fees: 180 Euros (257,14 USD Intl.)

Lawyers fees: 1500 – 5000 Euros (min 1048,50 USD Intl.) Court fees: 504 Euro (720 USD Intl.)

Lawyers fees: 2000 – 5000 Euros (min 1398 USD Intl.) Court fees: 288 Euro (411,42 USD Intl.)

Lawyers fees: 500 – 1000 Euros (min 349,50 USD Intl.) Court fees: 206 Euro (294,28 USD Intl.)

TOTAL: min 529,64 USD Intl.

TOTAL: min 1552,50 USD Intl.

TOTAL: min 643,78 USD Intl.

Lawyers fees: 210,57 RON (50 Euro) (103,72 USD Intl.) Court fees: 71,58 RON (17 Euro) (35,26 USD Intl.)

Lawyers fees: 4.252,26 RON (1.010 Euro) (2094,70 USD Intl.) Court fees: 1.321,99 RON (314 Euro) (651,22 USD Intl.)

Lawyers fees: 12.630,43 RON (3.000 Euro) (6.221,88 USD Intl.) Court fees: 0

TOTAL: min 1809,42 USD Intl. Lawyers fees: 12.630,43 RON (3.000 Euro) (6.221,88 USD Intl.) Court fees: 33.681,14 RON (8.000 Euro) (16.591,69 USD Intl.)

Lawyers fees: 21.051,02 RON (5.000 Euro) (10.369,96 USD Intl.) Court fees: 36,46 RON (8,66 Euro) (17,96 USD Intl.)

TOTAL: 138,98 USD TOTAL: Intl. 10.387,92 USD Intl.

TOTAL: 2.745,92

TOTAL: 6.221,88 USD Intl.

TOTAL: 22.813,57

69

Lawyers fees: 0 Court fees: 2.208 Euro (3.154,28 USD Intl.) TOTAL: 3.154,28 USD Intl.

Lawyers fees: 250 – 1500 Euros (min 357,14 USD Intl.) Court fees: 396 Euro (565,71 USD Intl.) TOTAL: min 922,85 USD Intl.

Lawyers fees: 4.210,14 RON (1.000 Euro) (2.073,96 USD Intl.) Court fees: 42,10 RON (10 Euro) (20,73 USD Intl.)

Lawyers fees: 2.105.070,82 RON (500.000 Euro) (1.036.980,69 USD Intl.) Court fees: 298,920.06 RON (71.000 Euro) (147.251,26 USD Intl.)

TOTAL: 2.094,69 USD Intl.

TOTAL: 1.184.231,95 USD Intl.

Lawyers fees: 1000 – 5000 Euros (min 699 USD Intl.) Court fees: 396 Euro (565,71 USD Intl.) TOTAL: 1264,71 USD Intl.

Lawyers fees: 2.105,07 RON (500 Euro) (1.037,29 USD Intl.) Court fees: 8,42 RON (2 Euro) (4,14 USD Intl.)

Lawyers fees: 42.101,42 RON (10.000 Euro) (20.739,61 USD Intl.) Court fees: 8,42 RON (2 Euro) (4,14 USD Intl.)

TOTAL: 1.041,43 USD Intl.

TOTAL: 20.743,75 USD Intl.

USD Intl. Russia

Lawyers fees: Not specified Court fees: 341,40 RUB (8 Euro) (18,06 USD Intl.)

Lawyers fees: Not specified Court fees: 197,66 RUB (4,50 Euro) (10,45 USD Intl.)

TOTAL: Uncertain

TOTAL: Uncertain

Lawyers fees: Court fees: Not specified

USD Intl. Lawyers fees: 439.249,68 RUB (max) (10.000 Euro) (23.240,72 USD Intl.) Court fees: 0 TOTAL: Uncertain

Scotland

Singapor e

Lawyers fees: Court fees: Min £500 (327,50 USD Intl.);

Lawyers fees: Court fees: Estimated cost: £35000 (22925 USD Intl.)

TOTAL: 327,50 USD Intl.) TOTAL: 22.925 USD Intl. Lawyers Lawyers fees: None fees: 4500

Lawyers fees: 219.624,84 RUB (5000 Euro) (11.620,36 USD Intl.) Court fees: 0 TOTAL: Uncertain

Lawyers fees: Court fees: 10.322,37 RUB (235 Euro) (546,15 USD Intl.) TOTAL: Uncertain

TOTAL: Uncertain Lawyers Lawyers fees: fees: Court fees: Court fees: For both Estimated parties: costs: £6000 460000 GBP ; (3930 USD 301300 USD Intl.) Intl.

Lawyers fees: Court fees: Estimated cost: £9000 (5895 USD Intl.)

Lawyers fees: Court fees: Estimated cost: £26.500 (17.357,50 USD Intl.)

Lawyers fees: Court fees: Estimated cost: £40.000 (26.200 USD Intl.)

TOTAL: 5895 USD Intl.

TOTAL: 17.357,50 USD Intl.

Lawyers fees: 5000

Lawyers fees: 100000

TOTAL: TOTAL: 3930 USD 26.200 USD Intl. Intl. Lawyers Lawyers fees: fees: 10000

70

Lawyers fees: 2.196.248,40 RUB (50.000 Euro) (116.203,61 USD Intl.) Court fees: 96.634,93 RUB (2200 Euro) (5112,95 USD Intl.)

Lawyers fees: Court fees: Police complaint route

TOTAL: Uncertain Lawyers fees: Court fees: No response to case study

Lawyers fees: Court fees: For both parties: 186763,99 Euro (160000 GBP) 104800 USD Intl.

Lawyers fees: 20.000 S$

Lawyers fees: Court fees:

TOTAL: 301.300 USD Intl. Lawyers fees: Court fees:

Lawyers fees: 439.249,68 RUB (10.000 Euro) (23.240,72 USD Intl.) Court fees: 1.976,62 RUB (45 Euro) (104,58 USD Intl.)

Court fees: 10 S$ TOTAL: 10,79 USD Intl.

Spain

Sweden

Lawyers fees: 165 Euros, Court fees: 0

S$ Court fees: 10000 S$ TOTAL: 15.645,50 USD Intl. Lawyers fees: 1.041,81 Euros; Court fees: 0

TOTAL: 128,70 USD TOTAL: Intl. 812,61 USD Intl. Lawyers Lawyers fees: fees: Not Court fees: specified Court fees: Not 7.721,45 specified SEK (725 Euro) (832,05 USD Intl.) TOTAL: Uncertain

S$ Court fees: min 15000 S$

S$ Court fees: min 60000 S$

TOTAL: 21.580 USD Intl. Lawyers fees: 1.041,13 Court fees: 0

TOTAL: 172.640 USD Intl. Lawyers fees:1421,13 Euros Court fees: 0

TOTAL: 812 USD Intl. Lawyers fees: Court fees: Compulsor y insurance

Court fees: TOTAL: min 300000 S$ (323.700 USD Intl.)

No precise answer

TOTAL: 1108,48 USD Intl.

Lawyers fees: min 1500 SEK (13.923 USD Intl.) Court fees: 450 SEK (4176.9 USD Intl.)

S$ Court fees: min 15000 S$ TOTAL: 26.975 USD Intl. Lawyers fees: 1767,53 Court fees: 0 TOTAL: 1378,67 USD Intl.

Lawyers fees: Court fees: Insurance route!

TOTAL: 18.099,90 USD Intl.

Lawyers fees: not specified (per hour– 1500 – 5000 SEK); Court fees: 450 SEK (4176.90 USD Intl.) TOTAL: Uncertain

71

TOTAL: min 500000 S$ (539.500 USD Intl.)

Lawyers fees: 103.567,13 Euros Court fees: 0

Court fees: min 20.000 S$

Not specific enough

TOTAL: 43.160 USD Intl.

TOTAL: min 40000 S$ (43.160 USD Intl.)

Administrativ e route

Lawyers fees: 103.567,13 Euros Court fees: 0

TOTAL: 80782,36 USD Intl.

Lawyers fees: not specified (per hour: 1500 – 5000 SEK) Court fees: 450 SEK TOTAL: Uncertain

TOTAL: 80782,36 USD Intl.

Lawyers fees: Court fees: Administrati ve route

Lawyers fees: not specified (per hour: 1500 – 5000 SEK) Court fees: 450 SEK TOTAL: Uncertain

Switzerla nd

Lawyers fees: Court fees: 65 CHF (38,01 USD Intl.) TOTAL: 38,01 USD Intl.

Taiwan

Lawyers fees: Not specified Court fees: 863,14 TWD (18,50 Euro) (49,35 USD Intl.)

Lawyers fees: Not specified Court fees: 5.000 CHF (2.923,97 USD Intl.) TOTAL: Uncertain

Lawyers fees: Court fees: Not specific enough

Lawyers fees: 1.600 CHF (935,67 USD Intl.) Court fees: 1.165 CHF (1.640,84 USD Intl.) TOTAL: 2.576,51 USD Intl. Lawyers fees: Court fees: Not specific enough

Lawyers fees: Not specified Court fees: 3.165 CHF (1.850,97 USD Intl.)

Lawyers fees: Court fees: Not specified

TOTAL: Uncertain

Lawyers fees: Court fees: Not specific enough

Lawyers fees: Court fees: Not specific enough

TOTAL: Uncertain

72

Lawyers fees: 1.900 CHF (1.111,11 USD Intl.) Court fees: 1.445 CHF (845,02 USD Intl.) TOTAL: 1.956,13 USD Intl. Lawyers fees: Court fees: Not specific enough

Lawyers fees: 148.500 CHF (86.842,10 USD Intl.) Court fees: 83.800 CHF (49.005,84 USD Intl.)

Lawyers fees: 1.400 CHF (818,71 USD Intl.) Court fees: 300 CHF (175,43 USD Intl.)

TOTAL: 135.847,94 USD Intl.

TOTAL: Uncertain

Lawyers fees: Court fees: Not specific enough

Lawyers fees: Court fees: Not specific enough

Lawyers fees: Court fees: Not specified

Lawyers fees: Court fees: Not specified

Appendix V. Summaries of amounts of Court Fees and Lawyers’ Fees Country

Lawyers fees in local currency (if different to Euros)

Fee in Euros 74

Austria

Australia

Belgium

74 75

150 - 600

Additional remarks

Court fees (local currency and Euros) 75

Additional remarks

Tariff system No hourly rates

Between 19 and 5962 Euro (Scale for cases between 150 and 363.360 Euros)

TARIFF: according to value of the case – tariff established by Statute. Different tariff for appeal and third instance proceedings

In Supreme Court of Australia: $1453 (826,27 Euro) (company) $606 (344,68 Euro) (individual) to lodge a case and the same amount for filing a cross-claim 35 Euro (lower court), 186 (appeal court), 325 (Supreme Court)

FLAT FEE, depending on court: for example Federal Court of Australia, or the Local Court of New South Wales; also different for businesses (higher) and individuals (lower) Additional fee for hearing! FLAT FEE depending on court

86,02 – 344,07

Tariff system, depending on value of the

Conversion rates as per 30 June 2009 at: http://www.xe.com/ucc/convert.cgi. Conversion rates as per 16 July 2009 at: http://www.xe.com/ucc/

73

Bulgaria

60

30,69

Canada

125 - 900

79,10 – 569,44

China

3.000

312,03

Czech Republic

case Normally fixed fees are used, not hourly fees

4% of value of claim (min 50 BGN – 25,57 Euro)

Fee depends on location of firm and seniority of lawyers. Some jurisdictions provide guidelines on amounts of hourly fees for costs-shifting purposes (for example – Ontario: between $80 $350 per hour) Maximum amount

-

Minimum amount – 50 RMB (5,19 Euro), tariff varies from 2,5% in low value cases to 0,6% in high value cases

No hourly rates in report – tariff system is popular

74

4% of value of the case: fees range between 600 (23,15 Euros) and 1.000.000 (38.581,54 Euros). If claim

TARIFF, established by Statute, depending on the value of the claim; SOME FLAT FEES (for instance: cases where value cannot be determined, divorce cases, or insolvency cases) No data

TARIFF established by statute, depending on value of case; some FLAT FEES (for instance in IP cases, divorce, defamation, labour cases) TARIFF established by statute, depending on value of case and whether claim was brought online or not

Denmark

England and Wales

1.000 – 3.750

134,33 – 503,74

109 - 402

128,10 – 472,43

brought online (and not worth more than 1.000.000 – fees are 2%, they range from min 300 (11,65 Euros) 500 DKK (67,17 Euros) for non-pecuniary claims and pecuniary claims up to 50.000 DKK; For pecuniary claims exceeding 50.000 DKK in value: 500 + 250 (100,74 Euros) + 1,2% of value of case (maximum 75.000 DKK – 10.074,40 Euros) Between £30 (34,89 Euros) (for a claim of less than £300) to £1,530 (1779,23 Euros) (for a claim of £300,000 or of unlimited value 255 Euros, with the maximum cap of 95.967 Euros

Fee depends on seniority of lawyer and location of law firm Average amounts

Estonia

64 - 128

Finland

150 – 400

Average amounts

France

220 - 500

Amounts depend on the

Cases decided: In writing: 70 Euros Orally: 100 Euros In one-judge hearing: 130 Euros In ‘full court’: 160 Euros Free to individual parties, some exceptions in commercial cases

75

TARIFF established by statute

TARIFF established by statute, depending on value of case, payable for specific forms or activities. Amounts here – for lodging the case TARIFF established by statute, depending on value of case. Amount here – for case worth 1282 Euros FLAT FEE established by statute. Amounts here for District Court (first instance)

area of law, urgency, and location of law firm No hourly rates in report – tariff system

Germany

Greece

No hourly rates in report – tariff system

Hong Kong

No amounts in report

Hungary

80 - 500

Ireland Italy

25 - 665

No amounts in report UNCLEAR if these are hourly fees or fees per activity!

76

3 x 196 Euros = 588 Euros

TARIFF established by statute, depending on value of case (and varied in different instances). Amounts here – for a claim of 10.000 Euros in first instance Judicial stamp duty: 4 – 5 TARIFF established by statute, Euros + 6,95% of the value of depending on value of case. the case Percentage fee only payable if final decision is to include financial settlement of some kind FLAT FEE, depending on type High Court: For issuing writ of summons: of court HK$1045 (95,49 Euros), For setting case down for trial: same amount District Court: HK$630 (57,56 Euros) 6% of value of case: min 7000 TARIFF established by statute; HUF (25,52 Euros), max depending on value of case 900000 HUF (3281,94 Euros) No amounts in report between 30 and 1100 Euros; if non-pecuniary claim: flat fee of 340 Euros for civil cases

TARIFF established by statute, depending on value of case

Japan

20.000 – 100.000

147,81 – 738,99

Latvia

20 - 300

28,60 - 429

Lithuania

51 – 831 LTL

15 – 250 Euro

Netherlands

Norway

Tokyo rates

Revenue stamp: 9000 Yen (68,84 Euros) + Prepaid stamp: 6000 Yen (45,22 Euros)

345 Euros

Lawyers also sometimes agree a fixed ‘per case’ fee. Contingency fees are also allowed.

36 – 1184 Euros for individuals; up to 6174 Euros for companies Board (normally obligatory) – 860 NOK (95,55 Euros); District Court: 5 x 860 NOK = 4300 NOK = 477,69 Euros;

75 - 700

1000 – 4000 138,49 + VAT 553,95 (25%), so 1250 - 5000



77

No amounts in report; case studies mention two payments: revenue stamp and prepaid stamp. Amounts here: RTA case with 6000 Euros cost of repair TARIFF established by statute; depending on value of case; case studies describe that the percentage ranges from 15% for cases less than 1423 Euros, through 2,5 % and 1,6% of larger value cases. Amounts here – RTA case with 6000 Euros repair costs Tariff system established by the Code of Civil Procedure, depending on the value of the case: between 3% and 1%. Lower percentage rates accompany higher value cases, and there is also a lump sum (between 870 and 2.030 Euro) payable in such cases. TARIFF established by statute, depending on value of case FLAT FEE established by statute

Poland

100 – 400

22,28 – 89,13

Portugal

60 - 300

Romania

350

Russia

300

Scotland

69 – 169 (149 Average)

Singapore

100 – 1000

48,86 – 488,60

but small claims: 3010 NOK (334,26 Euros) Average 5% of value of case (30 – 1000 amounts PLN in civil cases (6,95 Euros – 231,58 Euros), 50 – 3000 PLN (11,59 Euros – 695,33 Euros) in commercial cases); Depending on 96 – 2340 Euros (+ additional seniority 480 Euros for each amount of 25000 Euros in high value cases) Maximum Between 1% (high value cases) amount – can be and 10% (low value cases) of lower value of case Average Between 0,5% (high value amount cases) and 5% (low value cases) of value of case, maximum 440 Euros Court of session (ordinary civil cases): 170 GBP (197,53 Euros). Sheriff Court (initial writ): 120 GBP (139,43 Euros) 500 (243,82 Euros) (less than $1.000.000) and 1000 (487,67 Euros) (more than $1.000.000) – initial writ fee.

78

TARIFF established by statute, and FLAT FEE for certain specified cases

TARIFF established by statute, depending on value of case

TARIFF established by statute, and some FLAT FEES TARIFF established by statute

FLAT FEE established by statute for each action, writ, etc.

Court charges comprise: Court fees, electronic filing system fees (not specified in report), and hearing fees (if applicable). FLAT FEES are specified by statute for each action, writ, etc. There is a two-stage tariff

Spain

94,50 – 252 Euro

Sweden

1.104

101,81

Switzerland

350 - 600

229,37 – 393,28

Bar Council establishes rates for costsshifting purposes (not binding, but in practice observed) – these depend on the value or type of case Official government rate for legal aid purposes Rates for major commercial firms in Zurich

(less than $1m and more than $1m). 90 (oral proceedings) – 300 If amount in dispute cannot be (appeal) amount established by set – the amount assumed is statute + 0,50% of amount at 18.000 Euro stake (if up to 1.000.000 Euro), and above that 0,25% (max 6000 Euro)

450SEK (40,83 Euros) (application for summons)

FLAT FEE: regulated by statute, depending on type of case

Canton court: between 150 CHF (98,73 Euros) and 120.750 CHF (79.469,51 Euros)+ 0,5% of the value of case above 10.000.000 CHF; for non-pecuniary claims: between 300 (197,44 Euros) and 13.000 CHF (8554,76 Euros);

TARIFF established by statute; in cantonal courts – amounts here for the canton of Zurich (amounts can be increased or decreased by court if case is especially complex or straightforward);

In Federal Supreme Court: Between 200 CHF (131,63 Euros) and 100.000 CHF (65.814,21 Euros)

79

In Federal Supreme Court: TARIFF established by statute, depending on value of case

Taiwan

No report

USA

No amounts in report

Between 1.000 and 1.000.000.000 NTD (21,52 Euros to 21.521.107,62 Euros); for non-pecuniary claims: 3.000 NTD (64,60 Euros) $350 (248,27 Euros)

80

TARIFF established by statute, depending on value of case; amounts here: first instance costs

FLAT FEE established by statute; amounts here – Federal Court only

Appendix VI. Success and Contingency Fees “Contingency fee” is defined as a fee that is based on a proportion of the sum recovered (pactum de quota litis). A “conditional or success fee” is payable only upon a successful conclusion of the case and may include an uplift over normal rates but does not include a proportion of the damages recovered.

Country

Success fee

Australia Austria Belgium Bulgaria Canada Cyprus Czech Republic Denmark Estonia Finland France Germany Greece Hungary Ireland Italy

Yes, capped in Federal Court at 25% permitted for TPF Yes Yes?

Japan Latvia Lithuania Luxembourg Malta Netherlands

Yes Yes

Norway Poland Portugal Romania Russia Singapore Slovakia Slovenia Spain Sweden Switzerland Taiwan UK: England UK: Scotland USA

Yes Yes Yes Yes Unenforceable but used No

Yes, capped at 25% Yes

Yes Yes, 20% cap Yes: no win no fee common

Yes

Yes (CFA 1995, 100% cap) Yes 100% cap -

Contingency fee No No No Yes No No No Yes Yes (rare) No Yes 2008 on conditions (rare) No Yes No Yes 2006 (agreement must be in writing) Yes Yes, but 50% uplift is illegal. No No No. Bar lifted ban on contingency fees 2004, but Ministry not approved. No No (but occurs) No No Unenforceable but used No Yes, up to 20% Yes up to 15% Yes No, Yes for class action No; Success fee 2005 Yes No No Yes

Primary Sources: National Reports from the Oxford Funding and Costs Project, 2009; National Reports in the Stanford-Oxford Global Class Actions Project 2008 www.law.stanford.edu/classactionconf; and Reports in the IBA Task Force on International Procedures and Protocols for Collective Redress, 2007 (restricted copy).

81

Appendix VII. Abbreviations

ATE

after the event (insurance)

BTE

before the event (insurance)

CEPEJ

European Commission for the Efficiency of Justice

CFA

conditional fee agreement

CLAF

Contingency Legal Aid Fund

CPR 1999

Civil Procedure Rules 1999 (England and Wales)

LEI

legal expenses insurance

RTA

road traffic accident

SLAS

Supplementary Legal Aid Scheme

82

Case Study 1: Small Claim Repayment to a consumer of €200 price paid for product not delivered.

83

Case Study 1: Disaggregated Total USD Intl.

Decompsition of total cost into lawyer and court fees  Lawyers Fees

Court Fees

4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0

USD Intl.

Case Study 1: Aggregate Total Total cost to claimant

4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0

84

USD Intl. 4,500

Case Study 1: Lawyer Fees

4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0

USD Intl.

Case Study 1: Court Fees

350

300

250

200

150

100

50

0

85

Case Study 1: Claimant vs Defendant Costs USD Intl.

Claimant

Defendant

4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 0

86

Case Study 2: Family Divorce between husband on average income (say €50,000 pa), wife with no income, two children, living in an average home.

87

Case Study 2: Disaggregated Total USD Intl. 16,000

Decompsition of total cost into lawyer and court fees  Lawyers Fees

Court Fees

14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

USD Intl.

Case Study 2: Aggregate Total Total cost to claimant

25,000

20,000

15,000

10,000

5,000

0

88

USD Intl. 12,000

Case Study 2: Lawyer Fees

10,000

8,000

6,000

4,000

2,000

0

USD Intl.

Case Study 2: Court Fees

10,000 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0

89

Case Study 2: Claimant vs Defendant Costs USD Intl.

Claimant

Defendant

16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

90

Case Study 3: RTA Road traffic accident. Collision in which the rear of the claimant’s car and the front of the defendant’s car are moderately damaged (i.e. rear and front respectively require total replacement panels, but engine is undamaged); cost of repair and replacement car €6,000.

91

Case Study 3: Disaggregated Total USD Intl. 25,000

Decompsition of total cost into lawyer and court fees  Lawyers Fees

Court Fees

20,000

15,000

10,000

5,000

0

USD Intl.

Case Study 3: Aggregate Total Total cost to claimant

25,000

20,000

15,000

10,000

5,000

0

92

USD Intl. 25,000

Case Study 3: Lawyer Fees

20,000

15,000

10,000

5,000

0

USD Intl.

Case Study 3: Court Fees

16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

93

Case Study 3: Claimant vs Defendant Costs USD Intl.

Claimant

Defendant

25,000

20,000

15,000

10,000

5,000

0

94

Case Study 4: Employment Wrongful loss of employment by a middle-ranging manager (say salary €50,000 pa).

95

Case Study 4: Disaggregated Total  USD Intl. 160,000

Decompsition of total cost into lawyer and court fees  Lawyers Fees

Court Fees

140,000 120,000 100,000 80,000 60,000 40,000 20,000 0

USD Intl.

Case Study 4: Aggregate Total Total cost to claimant

160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0

96

USD Intl. 100,000

Case Study 4: Lawyer Fees

90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0

USD Intl.

Case Study 4: Court Fees

60,000

50,000

40,000

30,000

20,000

10,000

0

97

Case Study 4: Claimant vs Defendant Costs USD Intl.

Claimant

Defendant

160,000

140,000

120,000

100,000

80,000

60,000

40,000

20,000

0

98

Case Study 5: Medical Negligence Doctor’s error results in permanent (a) loss of ability to walk (b) paraplegia, for male claimant aged 25 on salary of €25,000 pa. Patient has no current dependents, but likely to get married and start family with two children.

99

Case Study 5: Disaggregated Total USD Intl. 180,000

Decompsition of total cost into lawyer and court fees  Lawyers Fees

Court Fees

160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0

USD Intl.

Case Study 5: Aggregate Total Total cost to claimant

300,000

250,000

200,000

150,000

100,000

50,000

0

100

USD Intl. 180,000

Case Study 5: Lawyer Fees

160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0

USD Intl.

Case Study 5: Court Fees

60,000

50,000

40,000

30,000

20,000

10,000

0

101

Case Study 5: Claimant vs Defendant Costs Claimant

Defendant

USD Intl. 200,000 180,000 160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0

102

Case Study 6: SME Small company claim for unpaid debt of €8,000.

103

Case Study 6: Disaggregated Total USD Intl. 25,000

Decompsition of total cost into lawyer and court fees  Lawyers Fees

Court Fees

20,000

15,000

10,000

5,000

0

USD Intl.

Case Study 6: Aggregate Total Total cost to claimant

25,000

20,000

15,000

10,000

5,000

0

104

USD Intl. 18,000

Case Study 6: Lawyer Fees

16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

USD Intl.

Case Study 6: Court Fees

16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

105

Case Study 6: Claimant vs Defendant Costs USD Intl.

Claimant

Defendant

18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

106

Case Study 7: Large Commercial Case Substantial and complex breach of contract claim between two large companies over supply of defective machinery worth €2 million, resulting in a €5 million loss of profit.

107

Case Study 7: Disaggregated Total USD Intl.

Decompsition of total cost into lawyer and court fees  Lawyers Fees

Court Fees

1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0

USD Intl.

Case Study 7: Aggregate Total Total cost to claimant

1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0

108

USD Intl. 1,800,000

Case Study 7: Lawyer Fees

1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0

USD Intl.

Case Study 7: Court Fees

350,000 300,000 250,000 200,000 150,000 100,000 50,000 0

109

Case Study 7: Claimant vs Defendant Costs Claimant

Defendant

USD Intl. 1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0

110

Case Study 8: Injunction - Consumer Injunction against neighbour to stop noise.

111

Case Study 8: Disaggregated Total USD Intl.

Decompsition of total cost into lawyer and court fees Lawyers Fees

Court Fees

40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0

USD Intl.

Case Study 8: Aggregate Total Total cost to claimant

45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0

112

USD Intl. 20,000

Case Study 8: Lawyer Fees

18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

USD Intl.

Case Study 8: Court Fees

20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

113

Case Study 8: Claimant vs Defendant Costs Claimant

Defendant

USD Intl. 35,000

30,000

25,000

20,000

15,000

10,000

5,000

0

114

Case Study 9: Injunction - Commercial Prevent illegal breach of intellectual property in commercial information between two substantial companies.

115

Case Study 9: Disaggregated Total USD Intl.

Decompsition of total cost into lawyer and court fees Lawyers Fees

Court Fees

160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0

USD Intl.

Case Study 9: Aggregate Total Total cost to claimant

160,000 140,000 120,000 100,000 80,000 60,000 40,000 20,000 0

116

USD Intl. 140,000

Case Study 9: Lawyer Fees

120,000

100,000

80,000

60,000

40,000

20,000

0

USD Intl.

Case Study 9: Court Fees

20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0

117

Case Study 9: Claimant vs Defendant Costs Claimant

Defendant

USD Intl. 250,000

200,000

150,000

100,000

50,000

0

118