Colman Coyle were instructed by a small private building company seeking to recover several hundred thousand pounds which it claimed to be owed having carried out substantial works to a luxury flat in London.
The builder and the client had fallen out during the course of the works. The client terminated the contract and there had been two adjudications involving the parties prior to Colman Coyle being instructed.
Although the builder had a potentially good claim, the client argued that there had been substantial defective works and that the cost of remedying these more than outweighed the value of the claim.
The parties were not able to resolve matters and this meant that they now faced expensive litigation which would require solicitors, counsel and expert witnesses on each side.
The builder was not in a position to fund this kind of expense and was also aware that that it was likely to be ordered to provide security for the Defendant’s costs as a condition of pursuing any litigation, which it would have struggled to do.
Colman Coyle were able, through their relationship with specialist third party funders, to obtain funding for the builder to enable it to pursue the claim. The third party funders provided sufficient funds to cover all expenses (eg Counsel, Expert and Court fees) and also provided funds for the builder to obtain insurance to cover the other side’s costs in the event the claim did not succeed. Colman Coyle agreed to work under a Conditional Fee Agreement (often referred to as “No Win No Fee”). This meant that the costs risk and burden to the builder was very much reduced so that it could afford to bring a claim.
Proceedings were commenced in the Technology and Construction Court. Shortly after the Case Management Conference the parties agreed to attempt to resolve the matter through mediation.
They were able to reach an agreement to settle the dispute with the client agreeing to make a substantial payment to the builder.
Without the aid of the third party funding and the Conditional Fee Arrangement with Colman Coyle, it is likely that the builder would simply not have been able to pursue its legitimate claim.
As litigation costs continue to be substantial, not aided by the recent increase in Court fees, this is an increasing problem for many clients. Many new and innovative options for funding are becoming available in the market. It is important for clients that they ensure that the solicitors who they instruct are aware of the options that might be available to them to ensure that they can pursue claims even if the cost of funding would otherwise make this prohibitive.
