The Chancery bar has shown its value and resilience during the recession and is in good shape to meet the challenges of the future.
The past year has been difficult for all sectors of the legal world as the commercial and political pressures of the recession have hit business models.
Inevitably, when clients face financial pressure, there is less money around to fund litigation. Indeed, according to the Ministry of Justice, in the first quarter (Q1) of 2010 there were 20 per cent fewer claims issued than in the equivalent period in 2009.
The Chancery and commercial bar has not been immune from this pressure. This article examines some key areas of the Chancery and commercial bar, noting the main trends of the past 12 months. Despite the pressure, the future, while challenging, need not be bleak.
The drop in county court claims in Q1 included a significant drop in claims for the possession of land. This fall is perhaps unsurprising as it coincided with both the recession impacting on the ability of clients to fund litigation and the effect of increased government intervention in residential possession proceedings, including the ’mortgage pre-action protocol’.
Furthermore, the introduction of the Mortgage Repossession (Protection of Tenants etc) Act 2010, due to come into force on 1 October, is likely to increase the obstacles in the way of mortgagees seeking possession and put further downward pressure on the number of claims being issued.
This presents both a challenge and an opportunity to the junior end of the Chancery and commercial bar. Fewer possession claims are likely to be issued. However, clients wishing to litigate will need advice on how to comply with the growing number of technical and procedural obstacles in their way. Furthermore, the pitfalls of possession proceedings seem likely to increase the need for proficient and informed advocates in claims that are issued.
But the picture for property litigators has not been all doom and gloom. The past 12 months may have seen a fall-off in the number of claims issued for the recovery of possession of land, but there has been an increase in claims for the specific performance of contracts for the sale of land and concerning issues arising from conditional contracts for the sale of land.
Also, many Chancery and commercial barristers have observed a significant increase in the number of professional negligence claims being brought against, for example, solicitors, valuers and lenders.
Of course, the ultimate target of such claims is usually a professional indemnity insurer who, in the current climate, is often seen as the only party with the funds to satisfy judgment. This has overlapped with an increase in the number of claims resulting from problems within partnerships, including LLPs.
The Chancery and commercial bar continues to have a significant role in such claims by providing advocacy services together with legal and practical advice on how best to frame, plead, and run claims to ensure judgment is obtained and paid.
The world stage
The trusts and financial work of the commercial bar has flourished in both domestic and international disputes. Following on from the managed litigation arising out of the Lehman Brothers insolvency, London appears to have retained its reputation and attraction as a forum for global disputes.
The banking and financial crisis has led to dense and complex disputes about the interpretation of trusts, securities and contracts. In addition, as with the Lehman litigation, those issues are often further complicated by the insolvency of one of the parties in one or more jurisdictions. The Chancery and commercial bar has had, and will continue to have, a key role in enabling such disputes to be resolved.
Like every area of the legal and commercial world, the Chancery and commercial bar is operating in challenging trading conditions at the moment. Such conditions inevitably affect individual practitioners and chambers.
But Hardwicke barrister Michelle Stevens-Hoare remains positive. “The past year has shown that the Chancery and commercial bar can grow and succeed even in difficult conditions if it offers clients technical expertise and advocacy services in a way that meets their commercial and practical needs,” she contends.
It is inevitable that the future will be challenging, but by focusing its technical expertise on the commercial requirements of its clients the Chancery and commercial bar is well-placed to thrive in recovery as well as recession.
Philip Fellows is a barrister at Hardwicke