Barrister trio command £126,650 for one-day Tchenguiz appeal

A trio of barristers, including a Brick Court silk and Fountain Court duo, instructed by property tycoon Vincent Tchenguiz charged a £126,650 brief fee for a six-hour disclosure appeal last month (30 January 2014).

Brick Court barrister Charles Hollander QC, Fountain Court’s Rosalind Phelps and James Duffy were paid £85,000, £22,650 and £19,000 respectively to defend an unsuccessful one-day appeal brought by two Grant Thornton employees over the disclosure of sensitive documents that are central to the £300m court battle brought by Tchenguiz and his brother Robert against the Serious Fraud Office (SFO).

The SFO is preparing to defend a £300m claim from the Tchenguiz brothers who are seeking damages for trespass, wrongful arrest, human rights breaches, misfeasance in public office and malicious prosecution. The civil suit was launched after the brothers were subjected to a highly public dawn raid in 2011 in connection with the failure of their Oscatello company.

The Court of Appeal (CoA) last week held that Oscatello liquidators Mark McDonald and Stephen Ackers of Grant Thornton should release papers to Tchenguiz’s legal team despite their protestations that the papers were subject to litigation privilege.

Hollander’s bill for attending the six-hour hearing was £85,000, or £14,166 per hour, prompting concerns that the commercial litigation market has failed to take seriously the implications of the costs reforms advocated by Lord Justice Jackson in April last year (1 April 2013).

Fountain Court’s Phelps and Duffy commanded £41,650 in fees, while Phelps charged £17,500 just for attending the case and Duffy asked for a total of £19,000.

Hollander, who was instructed by Stephenson Harwood partner Sean Jeffrey, contended that the Grant Thornton duo provided the SFO with “misleading and inaccurate” information leading to a flawed criminal investigation that ended up costing the brothers more than £2.5bn

An interim costs order was made against appellants McDonald and Ackers, who will pass the £81,000 bill to the Oscatello group of companies.

The hefty counsel fees underline the significance of the CoA dispute.

A source said: “If the application is absolutely fundamental to the case and could produce smoking gun evidence then £85,000 is probably money well spent so it does depend. I think it’s very easy to have a knee-jerk populist shock horror reaction but clients don’t have to instruct a particular QC.”

Litigators said barrister fees were on the rise and showed no sign of abating. “I’ve seen some pretty eye-watering brief fees but that’s high,” said one source. “I’ve seen QCs charge £100,000 for two-day hearings.”

“I think the trend is always upwards,” added Mayer Brown litigation partner Rani Mina, “but the fact is top QCs at the London bar are very busy and people are willing to pay these kinds of brief fees to get the services.”

Reluctance from the bench to cut counsel fees ahead of court hearings was partially blamed for the spiralling fees.

“I haven’t heard of any judge pushing back on the level of counsels’ fees in terms of whether they are proportionate. But that was a question that people were asking about cost budgeting,” Mina said.

“I think they probably feel inherently uncomfortable saying what’s a reasonable level of fee. They wouldn’t necessarily know what to benchmark it against.”

Another said: “Judges aren’t that well equipped to deal with with costs but they just don’t want to get their hands dirty with this.”

But other sources said the onus was on clients and firms to refuse to use counsel with high fees. “It’s just a market and there are market forces,” said one.

Stephenson Harwood partner Jeffrey and his team, made up of two associates and a paralegal, charged £34,495 for the case.

Ackers and McDonald said: “We are disappointed by [the] judgement and are deeply concerned that the ruling will impede our work to recover assets from the Tchenguiz Discretionary Trust (TDT). However, we will not challenge the ruling. Instead we will continue to focus on our work to recover assets from the TDT. This includes work to recover £183 million of assets held in the TDT following a positive ruling by the Royal Court of Guernsey in December.”

Chadbourne & Parke partner John Verrill instructed South Square’s William Trower QC and David Allison for Ackers and McDonald.

Counsel fees  

Brick Court’s Charles Hollander QC

Fee for attending hearing £85,000  

Fountain Court’s Rosalind Phelps

Fee for advising and drafting £5,150

Fee for attending hearing £17,500  

Fountain Court’s James Duffy

Fee for advising and drafting £9,000

Fee for attending hearing £10,000  

Total fees £126,650