DAC, Berwin Leighton and Constants face £3m fee headache

Constant & Constant, Davies Arnold Cooper and Berwin Leighton Paisner could all face losing at least £1m each in fees on a piece of litigation because of an anomaly in the Conditional Fee Arrangement (CFA) system.
The claimant, Yeheskel Arkin – whose claim relates to alleged anticompetitive practices – is funding his case through a CFA, and has taken advantage of his right not to pay the defendants' lawyer's costs. The three firms, which have worked on the case for six years, have no means of getting paid through Arkin's private funds, as he is a pensioner on state benefits.
Constant partner Tim Reynolds said: “We believe this breaches Article 6 [right to a fair trial] of the Human Rights Act, for he has put us on trial at our expense.”
But the claimant's lawyer Susan Singleton, name partner at niche competition and intellectual property firm Singletons, said: “There's no legal obligation for the claimant to take out insurance in a CFA. Our client was completely destroyed by the cartel. If they [the defendants] end up paying costs, that's their fault.”
This is the second case of its kind. In the first, Private Eye was not paid hundreds of thousands of pounds owed in costs because the claimant, accountant John Stuart Condliffe, had not insured the defendant's costs. Condliffe agreed to pay £100,000 towards Private Eye's costs out of his own pocket.
Arkin's case is due to start later this month before Mr Justice Colman. It promises to be a landmark case, as it is the first time that a UK court will hear a case claiming damages for breaches of European Commission competition law. (See The Lawyer, 28 January, for more details of the case.)