Supreme Court to hear Mirror Group Newspapers' appeal over phone-hacking fees

Picture: Trinity Mirror

The Supreme Court is to hear an appeal by Mirror Group Newspapers on whether claimants in the phone-hacking case can claim success fees and after-the-event (ATE) insurance premiums.

A panel of three Justices – Lord Mance, Lord Reid and Lord Toulson – granted permission for the appeal, ordering that it should be heard along with the case of Times Newspapers v Flood.

The application was for permission to mount a “leapfrog” appeal against the decision of Mr Justice Mann in the High Court that the claimants in the phone-hacking case could recover success fees and ATE premiums related to the litigation and associated no-win, no-fee conditional fee agreements.

The judge held that recovery of these costs was not incompatible with MGN’s rights under the right to freedom of expression guaranteed by Article 10 of the European Convention on Human Rights.

The claimants in the case are those who have settled and those chosen as “representative” in the first wave of the MGN phone-hacking litigation.

The claims of the representative claimants were treated as test cases and Mr Justice Mann gave judgment in their favour, awarding record damages totalling £1.2 million in May last year.

That decision was upheld by the Court of Appeal on 17 December 2015. The Supreme Court later rejected MGN’s application for permission to appeal over the damages.

The latest appeal follows the Supreme Court’s decision in September that it would hear an appeal by Daily Mail publisher Associated Newspapers over the issue of the recoverability of success fees and insurance premiums.

Associated Newspapers is challenging success fees and insurance premiums charged by lawyers who represented businessman Andrew Miller in a case in which he won £65,000 in libel damages after suing the Daily Mail over a front-page article headlined “Met boss in new ‘cash for friend’ storm” which was published in October 2008.

Both MGN and Associated Newspapers argue that making losing media defendants pay success fees – which can in effect double the amounts charged by lawyers – and large ATE insurance premiums to protect claimants against the risk of having to pay the publisher’s costs if they lose the claim breaches the media’s rights to freedom of expression under Article 10.

Both Mr Justice Mann, in the MGN case, and Mr Justice Mitting in the case of Associated Newspapers have held that they are bound by the decision of the House of Lords in Campbell v MGN (No.2) ([2005] 1 WLR 3394) that recoverable success fees were not incompatible with Article 10.

It is believed that both the MGN and Associated Newspapers cases will be heard alongside Times Newspapers v Flood.

The three cases, which are expected to be heard next year, will be the first time the Supreme Court has had the opportunity to consider whether the CFA regime which continues to apply in publication cases is compatible with publishers’ Article 10 rights.

Successful appeals could mean the end the use of CFAs in publication cases.

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