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20 August 2020

Business courts bolstered by pandemic pragmatism as remote hearings rise

Judicial statistics show England & Wales's business courts weathered the pandemic well

By Ben Rigby

Outside The Rolls Building in London

The Rolls Building, Royal Courts of Justice, London Shutterstock

Business courts in England & Wales, including the Commercial Court, have risen to the challenge of the pandemic, according to the Law Society of England & Wales.

Statistics collected by the Society from the senior judiciary suggest that, following March’s lockdown, more than 85% of court business—whether interlocutory or final hearings—were dealt with remotely using a variety of online video platforms.

Data published by HFW and Solomonic in June bear out those findings, which showed a surge of cases in May following a short hiatus in March as the immediate impact of the pandemic was absorbed. Since then, however, business has been brisk—and focused.

Those conducted in London’s flagship court building, the Rolls Building, showed that 50% of all hearings in the Chancery Division—which hears property and commercial cases, including civil fraud—lasted less than an hour, and 70% lasted less than two hours. 

Figures from 2019 show 16,262 cases were issued in the Business and Property Courts, more than 3,000 fewer than 2018, largely due to a fall in company and insolvency cases last year, a trend which will surely be reversed in 2020 and beyond. 

The news is positive, given uncertainties over Brexit negotiations, under which current legal co-operation agreements are set to expire.

Post-Brexit accession to the Lugano Convention, on jurisdiction and the recognition and enforcement of judgments, remains stalled in trade negotiations. Examples of how London’s business courts are performing strongly demonstrate their value to negotiators in the EU and UK alike—as well as to busy corporates. 

The statistics were endorsed by Sir Geoffrey Vos, the Chancellor of the High Court. Vos, due to take over as Master of the Rolls in 2021, said: “Our business justice system, alongside London arbitration, can build on the achievements prompted by the dreadful coronavirus pandemic.”

Vos added: “The prospect of an increase in claims gives all of us involved in the UK’s dispute resolution process a big responsibility. We must make sure that our systems remain fit for purpose,”  echoing earlier remarks by Lord Burnett, the Lord Chief Justice, in his annual address to judges in lieu of the judiciary’s Mansion House dinner.

With the Commercial Court having gained newer members, such as Sir Richard Jacobs, Sir David Foxton, and Dame Sarah Cockerill, all of whom are familiar with technology and larger cases, the High Court judiciary has arguably responded positively as well.

“Hearing cases remotely when needs must is one thing, making sure that we have processes and rules fit for the 21st century is another,” Vos added, indirectly referencing ongoing reforms to disclosure and witness statements.

Associations back Law Society 

Vos’s views were reinforced by Law Society president Simon Davis, himself a senior commercial litigator at Clifford Chance, whose own financial performance has been lifted by a strong disputes department. 

Davis said the shift from physical to virtual hearings showed the system had adapted creatively to meet the needs of businesses at home and overseas.

Noting that the courts had already taken steps to adopt new technologies, “the pandemic has allowed widespread adoption in a short period of time,” he argued, saying “these figures prove the profession can confidently represent their clients in complex business disputes remotely.”

That message was endorsed by the London Solicitors Litigation Association, which represents solicitors specialising in business claims, and the Forum of Insurance Lawyers, which represents primarily defendant insurance firms, such as Clyde & Co, Kennedys, and the like.

John McElroy, a partner at commercial claimant firm Hausfeld and an LSLA committee member, said members had seen an upturn in Covid-related business disputes—and more were on the way.

"With some temporary insolvency measures due to come to an end this autumn, insolvency focused claims will also increase,” he expected, adding that 2020 and 2021 would show an increase in disputes on 2019.

To the LSLA, “the accelerated and extended use of virtual hearings demonstrated that efficiencies could be made, without impeding access to justice,” citing, as an example, electronic bundling as being both “much easier to use than expected, and so much faster.”

Anthony Baker, the president of FOIL and a partner at Plexus Law, agreed, saying the courts had reacted “extremely positively” to the ‘new normal’ and that justice for the commercial sector had continued almost seamlessly.  

The view from the City

Anna Pertoldi, a partner at Herbert Smith Freehills, spoke for many in commenting: “It was made very clear at an early stage in lockdown that the courts were going to do their level best to ensure hearings went ahead, remotely if necessary, and that’s exactly what has happened.”

Damian Honey, a partner at HFW, said the Society’s message “struck a chord with us,” his firm having experienced lots of virtual hearings. There was, he said, a definite ‘can-do’ attitude among members of the Commercial Court Users Liaison Committee to ensure cases could continue.

Honey suggested that virtual proceedings, hybrid or blended approaches which mixed video-conferencing facilities with physical in-person trials would become more popular, something endorsed by McElroy, who said LSLA hoped the courts would “continue to embrace remote hearings, where appropriate, as part of their offering.” 

There was endorsement from the client side, too, with Richard Blann, head of group litigation at Lloyds Banking Group, impressed by the courts’ intelligent adaptation of existing technology.

Similar sentiments have been expressed by the Bar. Members of Fountain Court reflected on the changes in a series of LinkedIn posts entitled ‘Lockdown Q&A’, which anticipated many of the findings reached by Vos. 

Commercial claimants speak out

Both boutiques and Silver Circle law firms also said their clients had been supported, not least with significant test case litigation on business interruption being heard remotely, in which both Mishcon de Reya and HSF are instructed.

Derval Walsh, a partner at Mishcon, noted: “As recently as July 23rd we had a case management conference on a significant banking dispute, and it was very efficiently handled, despite the fact that it was a virtual hearing with people participating from a variety of locations.”

Judges, said Walsh, were “well prepared and well versed in the finance and banking sector relevant to the disputes—also, they have been keen to be pragmatic and cut through matters.”

Luke Harrison, partner at new litigation boutique, Keidan Harrison, added: “We’ve found remote hearings and mediations to have been generally effective. We acted for a client in a multi-party four-day interim hearing recently and the court and parties’ approach to the litigation was on the whole at least as effective as a traditional ‘in-person’ hearing.”

Overall, Honey said, the guiding approach was one of pragmatism, guided by practicalities and efficiency. Both Vos and Davis will hope that the business courts will maintain that outlook, given concerns in other parts of the justice system—particularly criminal justice—about looming delays and backlogs. For commercial lawyers, at least, the future is a virtual one.

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