THE SCOTSMAN THURSDAY 12 NOVEMBER 2009 SCOTTISH LEGAL REVIEW 11
COMMERCIAL LITIGATION
THE past year has been very
busy but the explanation is
nowhere near as simple as the
oft-predicted "wall of
litigation" off the back of the
credit crunch. However, it's
clear that the trend for cases
being brought to a hearing in
court has continued.
Alternatives, like mediation,
are essential in good advice
but the tough financial
environment, with fewer new
deals available and more focus
on getting every last pound in
from past deals, is a
challenging environment for
solutions which can turn on
finding a new "win-win"
business relationship.
Another reason more
disputes are being fought out
before the court is that, in
easier economic times, the
enthusiasm to get deals done
could lead to "fudging" of
issues, on the assumption that
continued economic growth
meant any problems would not
be worth fighting over. Change
the economic backdrop and it
is critical to have a decision
about whose interpretation of
a contractual clause is the
right one. That comes at a time
when there is an impetus for
the courts to give contracts a
commercial reading in the
business context, rather than
an abstract legal meaning.
Result: more evidence about
the business background to
contracts.
It is all the more welcome,
then, that commercial courts
are increasingly responsive to
the need to focus on the issues
of substance and resolve these
within a realistic timeframe,
using devices like witness
statements to deal with
uncontroversial background.
Active case management of
this sort is integral to the
overhaul strategy for the civil
courts proposed in the Gill
Review, which is going to
challenge all those who work in
dispute resolution to focus on
what clients really need.
THE FIGHT IS STILL ONGETTING A GRIP
A wide range of
disputes are being
battled out in court
Picture: Nathaniel Benefield
Downturn means
thatlitigationlawyers
are busier than ever,
writes Garth Wood
I
I IS an old truism that recessions en-
courage litigation, and the current
global recession is certainly doing
nothing to contradict that piece of
wisdom. Tim Edward, head of commer-
cialdisputeresolutionatMaclayMurray
& Spens, says his team has been busy
across the board with a wide range of
disputes, with property litigation and
professionalnegligenceactionsleading
thecharge.
Every Scottish litigation lawyer
knowsthatthereallyjuicyactionsstem-
mingfromtheglobalbankingcrashwill
inevitablytakeplaceintheUS,whereju-
ries seem to have great difficulty distin-
guishing between a million and a
billion when awarding damages. But
this does not mean that Scotland will
not see a fair amount of professional
negligence actions in the coming
months. Of course, says Edward, it will
be a couple of years before these cases
come to judgment. "People are still for-
mulatingtheirclaimsandtherewillbea
definitetimelagbeforeanythingcomes
fromthecourts,"hesays.
Onefactorthatcouldbeinfluentialin
determining the number of cases that
cometocourtistheavailabilityofthird-
party finance, he points out. "There are
now a number of parties out there that
will invest in claims on a commercial
basis,anditmightwellbethatthiskind
offundingwillbewelcomednotjustby
people who do not have money them-
selves to bring actions, but also by com-
panies who want to offset some of the
cost risk associated with bringing ac-
tions,"hesays.
While some departments in legal
practices have seen a falling off in de-
mand through the downturn, Jim Cor-
mack, litigation partner at McGrigors,
saysthat,rightacrossScotland'sprofes-
sionalfirms,"litigatorshavebeenatthe
busierendofthings"."Inthegoodtimes
people had more flexibility to sort
things out amicably and the main con-
cern was to move on to the next deal.
Whenthemarketgoesstagnant,thereis
much more time to look at deals in
depth and detail and there is much less
roomforflexibility,"hesays.
Cormack is aware of the bonanza
someUSfirmsarelikelytoexperienceas
a result of litigation over the banking
disasterof2008.Buthesaysthatwhatis
more frustrating from a Scottish
perspective is the bias many potential
litigantshavetowardschoosingLondon
astheirforumratherthanScotland.
"Itisfairlyclearthatinsofarasthereis
going to be litigation arising out of our
UK financial crash, that will tend to be
donedowninLondonsimplybecauseof
the critical mass London offers. Howev-
er, we have the expertise here in Scot-
land to do pretty much anything here
thattheycandoinLondon,"hesays.
Lorna Sibbald, head of the commer-
cial litigation practice at Dundas & Wil-
son, says that while litigation has been
busythroughthedownturn,sofarthere
has not been the huge influx of litiga-
tionsthatonewouldnormallyexpectin
a recession. The reason, she suggests, is
that a number of would-be litigants are
worried about the potential insolvency
of the parties they would want to bring
an action against. There is no point
incurring costs suing someone who
goes bust in the middle of the action,
leavingyoutopickupthebill.
Shesays:"Surprisingly,weareseeinga
lot more instructions on fraud investi-
gations on the corporate recovery and
insolvency side, and we expect this to
growstillfurther."
1 Brodies
1 Dundas & Wilson
1 Maclay Murray & Spens
1 McGrigors
2 Burness
2 MacRoberts
2 Shepherd & Wedderburn
3 Anderson Strathern
3 Morton Fraser
3 Semple Fraser
COMMERCIAL LITIGATION
1 Brodies LLP
1 Dundas & Wilson
1 Maclay Murray & Spens
1 McGrigors
2 Anderson Strathern
2 Biggart Baillie
2 Burness
2 McClure Naismith
2 Shepherd & Wedderburn
2 Simpson & Marwick
3 Anderson Fyfe LLP
3 CMS Cameron McKenna
3 DLA Piper Scotland
3 Harper Macleod
3 Levy & McRae
3 MacRoberts
3 Pinsent Masons
3 Semple Fraser
DISPUTE RESOLUTION

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