Crisis talks over unpaid fees rescue litigation titans’ relationship
The Lawyer can reveal that relations between leading London set One Essex Court and litigation giant Herbert Smith reached crisis point last year following a bust-up over unpaid bills - underlining increasing tension between solicitors and barristers over fees.
Herbert Smith set relationship partner Kevin Lloyd was forced to call a summit with One Essex Court senior clerk Darren Burrows after the firm failed to hand over barrister fees worth more than £500,000.
The fees related to a case that made headlines in 2008 when it emerged that Herbert Smith had projected fees totalling £50m. Partner Simon Bushell had instructed One Essex Court’s Neil Kitchener QC to work alongside in-house advocate Murray Rosen QC in representing Tajik Aluminium Plant (now known as Talco) in its $485m (£316m) dispute against Abdukadir Ermatov.
The claim, which settled four weeks into an 18-week trial in November 2008, centred on allegations of corruption and bribery made by Talco against former business partner Azar Nazarov, a Tajik businessman now based in the UK.
According to sources, the claimant failed to settle its legal bills with Herbert Smith and the firm therefore wanted to avoid paying its barrister team.
“Herbies got burnt quite badly on the case, they were left exposed,” one source said. “It’s a bit unfair. The barrister relies on the lawyer to be honourable and pay.”
The source said that in an effort to stop the relationship from going into full meltdown, Lloyd called a meeting with Burrows and Fountain Court director of clerking Alex Taylor, whose barrister Deepak Nambisan had been led by Kitchener.
“They [Herbert Smith] said they’re the top litigation firm and One Essex Court would have to play ball,” the source said. “But Darren wasn’t happy about that and refused.”
Following the crisis talks it is understood that Herbert Smith has just begun handing the set instructions again - 15 months after the case.
In a statement the set said: “One Essex Court does not ordinarily comment on its relationship with individual clients. That said, our fees have been settled on this matter and there are no outstanding issues. We’ve always enjoyed an excellent relationship with Herbert Smith and that continues to be the case.”
Herbert Smith added: “We don’t comment on confidential matters, but we can confirm we continue to enjoy healthy and ongoing relationships with One Essex Court.”