In future, professionals such as analysts, advisers and recovery agents who are frequently involved in cases will be placed on an equal footing with solicitors and barristers by being able to receive instructions on a CFA basis.
This follows a rejection that CFAs between loss adjus-ters acting as recovery agents and insurers were invalid.
Most professionals engaged as recovery agents, analysts and advisers in litigation would have been deeply affected by an opposing ruling, as in most cases they are instructed on a CFA basis.
Loss adjusters are used in the vast majority of cargo damage claims, which last week's case, Papera Traders v Hyundai Merchant Marine and The Keinhin, related to. A high proportion of claims before the Admiralty Court and the Commercial Court relate to cargo claims.
The defendants in Papera effectively attempted to challenge the Court of Appeal's ruling in Factortame, in which judges held that accountancy firm Grant Thornton's CFA was valid.
Grant Thornton, like the adjustor company WK Webst-er in Papera, is described as a quasi-expert and so distinguishable from experts. The judge, Mr Justice Cresswell, said experts being instructed on a CFA is generally “undesirable”, as it means they have a “significant financial interest in the outcome of the case”.
However, the judge found that Websters did not have much scope for control of the litigation, as it was handled by the claimants' solicitors Richards Butler and Charles Priday of 7 King's Bench Walk. Priday described the action as a “vindication” of CFAs.