The UK200 2011 | By Katy Dowell
13 October 2011
3 January 2011
20 June 2011
16 July 2012
27 February 2012
While the boom in litigation has boosted revenues for the top commercial chambers in the past financial year, the gap between the best and the rest is beginning to grow.
International financial litigation exploded last year, driving growth for the most commercial sets at the bar. Yet chambers are working harder than ever to secure instructions as litigators demand lower rates for their clients and greater involvement from their barristers. Wilberforce Chambers first junior clerk Danny Smillie sums up the challenges.
“The bar’s had to adapt and become more commercially minded and accessible,” he says. “Barristers are expected to be part of a team and get more involved in all aspects of case management and client relationships.”
Caseloads are up but rates are down in all but the most specialised of matters. Clients are demanding greater fee flexibility and the days of the hourly rate appear to be numbered. They want estimates on a weekly basis as opposed to monthly or quarterly; they want seminars and training programmes; and they want secondees - and all while taking longer to pay up.
The biggest challenge facing chambers is financial management. According to Fountain Court director of clerking Alex Taylor, disciplined financial management is becoming the norm in litigation.
“All companies are looking at legal spend,” agrees One Essex Court senior clerk Darren Burrows. “There was a big intake of breath in 2008, when firms were asking for rate cuts and everyone was running health checks to make sure their spend was sustainable.”
Yet, for the second consecutive year, total revenue for The Lawyer’s bar top 30 grew by 6 per cent, from £797.59m to £845.91m.
In terms of turnover, Lincoln’s Inn set 4 New Square had the best year by far, with revenue up by 22.2 per cent, from £22.5m to £27m, pushing it four places up the rankings to number 14.
Doubts were raised about the future of the set when it emerged that barrister Aisha Bijlani was suing three successive heads of chambers - John Powell QC, Justin Fenwick QC and Roger Stewart QC - along with senior clerk Lizzie Wiseman for race discrimination. It successfully fought off the claim, which is now progressing to appeal, but not before it attracted some negative publicity in the national press.
There were concerns about how the set would respond to the claim and whether it could be held together while the case was ongoing. However, one source who regularly instructs 4 New Square barristers says it had the opposite effect.
“It bound them together and made the team culture stronger,” the source says. “Despite all the publicity, the set’s come out of the affair well.”
Of course, it is not just a collaborative culture that has driven turnover upwards at 4 New Square. The set’s expertise in professional liability is in demand as claimants scrutinise deals gone wrong as a result of alleged bad advice.
“The claims that are being fought are of a higher value,” says Wiseman. “Firms understand that professional liability claims need specialist input.”
That said, Wiseman adds that rates are under intense pressure.
Matrix Chambers chief executive Lindsay Scott agrees, saying firms are becoming “much harder” at negotiating.
“They’re driving down rates and want to get value for money,” Scott adds. “We’re seeing many more conditional fee arrangements and they don’t get counted in our annual billing.”
Scott says it was a “steady year” for Matrix, with an 8 per cent rise in turnover, from £17.2m in 2009-10 to £18.6m in 2010-11.
This is a significantly lower rate of growth than in the previous year, when turnover rose by 26.5 per cent, up from £13.6m in 2008-09.
This pressure on rates has prompted some sets to shore up instructions by bagging panel places. 39 Essex Street saw its growth slow in the financial year. It grew by 8 per cent, from £33.6m to £36.3m. Yet the set has taken to teaming up with lawyers to secure panel appointments and ensure a flow of work. It is instructed regularly by insurance giants Axa and Zurich, as well as picking up a raft of local authority work.
Chief executive David Barnes recognises that the surge in litigation is being driven by the wave of international work that is regularly attracted to London’s courts because of the jurisdiction’s reputation for dealing with disputes.
The unwinding of the global banking markets, which began with the collapse of Lehman Brothers in September 2008, is now being scrutinised by the courts.
Cases regarding allegations of international mis-selling and fraudulent activity on a global scale are being argued around the globe by leading domestic barristers.
According to Fountain Court’s Taylor, the bar continues to attract instructions from abroad because its expertise in banking and finance law outranks its peers’.
“Fountain Court, Brick Court Chambers, One Essex Court, Essex Court Chambers and 3 Verulam Buildings are the go-to sets for banking and finance litigation,” he insists. “It’s because of our reputation in this field and our banking and finance heritage. We’re in a very fortunate position.”
These are the sets that have enjoyed sustained revenue hikes since the downturn began.
The financial gap between Brick Court and One Essex Court narrowed during the year, with the former pipping the latter to top spot with a turnover of £47m, up by 10.6 per cent from £42.5m and beating One Essex Court’s £46.5m, which in turn was up by 12 per cent from £41.5m.
According to Burrows, it has been another “record year” thanks to several high-value cases reaching the appellate courts and the rise in international matters.
Neither set managed to eclipse Fountain Court or Wilberforce in terms of revenue per barrister (RPB). Brick Court, which is home to 37 barristers and 36 QCs including one of the country’s most highly paid silks in Jonathan Sumption QC, produced an RPB of £644,000 compared with £637,000 at One Essex Court, which has 47 barristers and 26 silks, including Tony Grabiner QC.
In terms of RPB, however, Fountain Court came in third after Wilberforce, which benefited from its stellar pensions practice, and 7KBW.
Wilberforce led the way, with each of its 50 members producing an RPB of £800,000, resulting in a turnover of £40m, up by 6.38 per cent from £37.6m a year earlier.
At 7KBW, a set well-regarded for its insurance and reinsurance expertise, turnover rose by 10 per cent to reach £34.9m, while revenues for each of its 48 barristers came in at £727,000.
Fountain Court, which was eclipsed in terms of turnover by Blackstone Chambers posted a revenue of £41m, up by 2.42 per cent from £40.1m, while RPB stood at £719,000 for each of its 57 members.
Meanwhile, Blackstone broke into the magic circle after a year of high-profile disputes. Turnover rose by 10 per cent, from £38.5m to £42.4m, but the set’s wide membership of 88 meant that its £504,000 RPB was significantly less than those of its peers.
Chambers may be under pressure in terms of fees, but the volume of high-value cases is on the rise. And the boom shows no signs of flagging, for the larger commercial sets at least.
The picture is not entirely rosy, however. The gap between those at the top of the rankings and those lower down is growing. We are starting to see a flight to quality. International litigation is driving the boom at the commercial sets, while those lower down the hierarchy must fight for their piece of the action.
1 - Brick Court Chambers
Tenants (silks): 73 (36)
Chambers contributions: 10-11 per cent
Revenue per barrister: £644,000
1 British Sky Broadcasting (BSkyB) & Ors v Ofcom & Ors
C: Thomas Plewman SC for BT; James Flynn QC for BSkyB; Helen Davies QC
for Premier League; Mark Hoskins QC for Virgin
2. NML Capital v Argentina
C: Jonathan Sumption QC for NML Capital
D: Mark Howard QC for Argentina
3. Springwell v JPMorgan Chase
D: Mark Hapgood QC for JPMorgan Chase
4. AAR Petroleum v BP International (Rosneft arbitration)
C: Mark Howard QC
D: Mark Hapgood QC
5. Building Schools for the Future judicial review
C: Jemima Stratford QC for Waltham Forest; Robin Levitt and Harry Matovu QC for Kent County Council
2 - One Essex Court
Tenants (silks): 73 (26)
Chambers contributions: 11 per cent
Revenue per barrister: £637,000
1. (1) British Arab Commercial Bank; (2) Arab Banking Corporation; (3) ABC Islamic Bank; (4) Calyon; (5) HSBC v Ahmad Hamad Algosaibi Brothers [AHAB] & Ors
C: Alex Polley for HSBC and HSBC Middle East; David Wolfson QC for CACIB
2. Chelsea Barracks planning application:
CPC Group Ltd v Qatari Diar Real Estate Investment Company
C: Tony Grabiner QC, Neil Kitchener QC and Alex Polley for CPC Group
3. Jivraj v Hashwani
C: Rhodri Davies QC for Nurdin Jivraj
I: Laurence Rabinowitz QC for the London Court of International Arbitration
4. Hogarth Davies Lloyd v Nomura International plc
D: Daniel Toledano QC for Nomura
5. Liverpool Football Club & Royal Bank of Scotland v Hicks & Gillett
C: Tony Grabiner QC and James Goldsmith for Liverpool FC
3 - Essex Court Chambers
Tenants (silks): 71 (35)
11 per cent
Revenue per barrister: £614,000
1. Cherney v Deripaska
C: David Foxton QC for Cherney
D: Paul Stanley and Paul Key for Deripaska
2. Dallah v Awami Trust & Government of Pakistan
D: Toby Landau QC for Government of Pakistan
3. Global Process Systems Inc (Respondent) v Syarikat Takaful Malaysia Berhad (Appellant)
R: Gordon Pollock QC and Claire Blanchard QC for Global Process Systems
4. Bloomsbury International Ltd & Ors v Sea Fish Authority & Department for Environment, Food & Rural Affairs (Defra)
A: Hugh Mercer QC, Tim Eicke QC and Iain Quirk for Sea Fish Authority & Defra
5. Attrill & Ors v (1) Dresdner Kleinwort;
C: Andrew Hochhauser QC and David Craig for Attrill & Ors
4 - Blackstone Chambers
Tenants (silks): 84 (34)
Chambers contributions: 13 per cent
Revenue per barrister: £504,000
1. R (on the application of the British Bankers’ Association [BBA]) v Financial Services Authority [FSA] and Financial Ombudsman Service [FOS]
C: David Pannick QC, Charles Flint QC, Javan Herberg and Simon Pritchard BBA.
D: Monica Carss-Frisk QC for the FSA and FOS
2. British Sky Broadcasting [BskyB] & Ors v Ofcom & Ors
D: Dinah Rose QC for Ofcom
3. (1) Morrisons; (2) Imperial Tobacco;
(3) Cooperative Group; (4) Safeway; (5) Asda; (6) Shell v Office of Fair Trading
C: Pushpinder Saini QC for Wm Morrison Supermarkets, Safeway Stores and Safeway Ltd; Dinah Rose QC and Brian Kennelly for Shell UK, Shell UK Oil Products and Shell Holdings (UK)
4. Imperial Tobacco, British American Tobacco, Philip Morris Ltd and Gallaher Ltd v Secretary of State for Health and the Attorney-General
C: David Pannick QC and Tom De La Mare for British American Tobacco; Dinah Rose QC and Brian Kennelly for Imperial Tobacco
5. (1) British Arab Commercial Bank; (2) Arab Banking Corporation; (3) ABC Islamic Bank; (4) Calyon; (5) HSBC v Ahmad Hamad Algosaibi Brothers [AHAB] & Ors
C: Thomas Beazley QC and Brian Kennelly in respect of Cayman proceedings & worldwide freezing order
D: Simon Pritchard for Sana Algosaibi for AHAB
5 - Fountain Court Chambers
Tenants (silks): 57 (27)
Chambers contributions: 13 per cent
Revenue per barrister: £754,000
1. R (on the application of the British Bankers’ Association) v Financial Services Authority [FSA] & Financial Ombudsman Service
D: Michael Brindle QC for the FSA
2. Jivraj v Hashwani
D: Michael Brindle QC for Sadruddin Hashwani
3. The Administrators of Lehman Brothers International (Europe) v Lehman Brothers Finance SA & Ors
D: Michael Brindle QC for Lehman Brothers Inc
4. Clydesdale Financial Services & Ors v Smailes & Ors
D: Tim Dutton QC and Bridget Lucas for Smailes & Ors
5. Swain v Mills & Reeve
D: Mark Simpson QC for Mills & Reeve
6 - Wilberforce Chambers
Tenants (silks): 50 (23)
Chambers contributions: 13.5 per cent
Revenue per barrister: £800,000
1. Shepperton Design Studios v Andrew Ainsworth
C: Michael Bloch QC and Alan Bryson for Shepperton Design Studios
2. Stena Line Ltd v (1) Merchant Navy Ratings Pension Fund; (2) P&O Ferries
R: Brian Green QC and Jonathan Hilliard for Merchant Navy Ratings Pension Fund
A: Christopher Nugee QC and Edward Sawyer for P&O Ferries
3. EasyGroup v EasyJet
C: Michael Bloch QC for EasyGroup
4. Derrick Barr & Ors v Biffa Waste Services
D: Ian Croxford QC for Biffa Waste Services
5. Prudential Staff Pensions v The Prudential Assurance Company & Ors
D: Michael Tennet QC for the Prudential
7 - No5 Chambers
Tenants (silks): 204 (23)
Chambers contributions: 0.5-15 per cent
Revenue per barrister: £179,000
1. Punchard v United Kingdom
(prisoner voting rights)
C: David Lock QC for Punchard
2. Herron v Parkwood Holdings
D: Richard Hignett for Parkwood Holdings
3. King’s Dock Biomass Plant Inquiry Richard Kimblen for residents’ group
3. Powertrain Group Litigation v (1) Powertrain Limited (in voluntary liquidation) (2) Houghton
C: Paul Bleasdale QC and John Coughlan QC for Powertrain Group Litigation
4. ZH (Tanzania) v Secretary of State for the Home Department
C: Manjit Gill QC for ZH
I: Edward Nicholson for the appellant’s children
8 - 39 Essex Street
Tenants (silks): 84 (30)
Chambers contributions: 22 per cent
Revenue per barrister: £432,000
1. Walker v Secretary of State for Energy and Climate Change
C: Gordon Nardell QC and Richard Wald
D: Stephen Tromans QC and Zack Simons for the Secretary of State for Energy and Climate Change
2. Motto Y & Ors v Trafigura
C: Robert Jay QC for Motto Y
D: Edwin Glasgow QC for Trafigura
3. Mugweni (by her mother and litigation friend Susan Mugweni) v NHS London
D: Neil Block QC and Judith Ayling for NHS London
4. R (Moore) V Skipton Fund Ltd and Secretary of State For Health
C: Vikram Sachdeva for R
D: Eleanor Grey QC for the Secetary of the State for Health
5. Muratova v New Millennium Group
C: Rohan Pershad QC for Muratova
9 - 3 Verulam Buildings
Tenants (silks): 63 (19)
Chambers contributions: 10.5 per cent
Revenue per barrister: £568,000
1. (1) British Arab Commercial Bank [BACB]; (2) Arab Banking Corporation; (3) ABC Islamic Bank; (4) Calyon; (5) HSBC v Ahmad Hamad Algosaibi Brothers [AHAB] & Ors
C: Jonathan Davies-Jones and David Simpson for BACB; Richard Edwards for CACIB; Sonia Tolaney for BNP Paribas
D: Ewan McQuater QC, David Quest and Peter Ratcliffe for AHAB in London and the Cayman Islands; Stephen Phillips QC in the Cayman proceedings and the worldwide freezing order
2. Centrica (British Gas) v Accenture
C: Sonia Tolaney QC and James MacDonald for Centrica
3. Berezovsky v Anisimov
D: Ali Malek QC, Sonia Tolaney QC and Anne Jeavons for Anisimov
4. Sita v Easco
D: Adrian Beltrami QC, David Head and Adam Kramer for Easco
5. Standard Chartered Bank v Ceylon Petroleum Corporation
D: Ali Malek QC, Clive Freedman and James MacDonald for Ceylon Petroleum
10 - 7KBW
Tenants (silks): 48 (21)
Chambers contributions: 10-12 per cent
Revenue per barrister: £727,000
1. Borealis v Kingspan Group
C: David Allen QC, James Brocklebank, Sushma Ananda and Elizabeth Lindesay
2. Munib Masri v Consolidated Contractors, Said Tawfic Khoury & Ors
C: Gavin Kealey QC and Stephen Philips QC for Masri
D: Alistair Schaff QC for Khoury
3. Masefield AG v Amlin Corporate Member
D: Peter MacDonald Eggers QC and Sarah Cowey for Amlin
4. Synergy Health v (1) CGU Insurance plc (trading as Norwich Union); (2) Axa Insurance; (3) Allianz Cornhill Insurance; (4) Royal & SunAlliance; (5) Towergate (formerly THB Clowes)
D: Richard Southern QC, Josephine Higgs and Sarah Martin for Towergate
5. Arash Shipping Enterprise Company v Groupama Transport
D: Peter MacDonald Eggers QC for Groupama