Companies angered by 'poker playing' DAC

Two European companies that took legal action over a dispute with Davies Arnold Cooper over fees, are said to be shocked and angered by the firm's behaviour after securing a reported £40,000 refund.

Davies Arnold Cooper represented the two companies in a successful arbitration case on a fixed-fee agreement. The bill for the work was subsequently disputed by Rudolf Romer, a management consultant acting for the companies.

Romer claimed the firm had overcharged his clients and had obstructed attempts to have the case taxed by the courts. He claimed the firm eventually repaid his clients more than £40,000 once a hearing date for taxation had been fixed. He said: “I am very annoyed by the behaviour of the firm. They were very arrogant and were playing poker with me.”

Davies Arnold Cooper admitted failing to document the fixed fee arrangement fully but would not comment on the amount repaid or whether it had overcharged the clients.

The firm pointed out that the clients would not have been able to continue with the arbitration but for the special fixed fee arrangement.

Managing partner David Hertzell said the affair was settled before taxation “on a commercial basis involving the refund of part of what was claimed because we had not recorded our fee arrangement with the client clearly, as in retrospect we should have done”.

He added: “We are sorry that this dispute arose, particularly in circumstances where such a good result was achieved for the client. However, the dispute has been resolved and we do not see what more we could reasonably do.”

Davies Arnold Cooper was the first City law firm to publish its fees, in a much publicised client services protocol.

Senior partner David McIntosh told The Lawyer last year: “We first launched the cost control initiative in 1993 because the firm was fed up with being tarred with the brush of law firms being too expensive.”

Davies Arnold Cooper announced last week the introduction in the firm of a new career structure allowing legal executives to follow a parallel career path to solicitors and enjoy partnership level status as “senior associates”.