TheJudge interviews Clive Zietman, Head of Litigation at Stewarts Law LLP. Click on the video above to see the full interview with Clive, including his views on the litigation funding market and the rise of specialist litigation practices.
In order to watch specific clips of the interview, please click on one of the links below:
- Introduction to Clive and Stewarts – click here
- Clive’s views on the changes in the legal sector, the challenges in handling cases against financial institutions and Stewarts’ move to the US – click here
- Litigation funding issues facing the market today – Clive’s views on the Jackson reforms, the introduction of DBAs and clients’ changing attitudes towards litigation funding – click here
- How Clive would choose a lawyer, how to manage clients, tendering for business against other law firms, litigation versus arbitration and what Clive thinks makes a good litigator – click here
- Clive’s ideal dinner guests, why Clive became a lawyer and what he would be if he weren’t a lawyer – click here
Please note that the views expressed within this interview may not be those of the firm.
A written transcript of the interview is available below:
A transcribed copy of TheJudge interview with Clive Zietman, Head of Litigation at Stewarts Law LLP is available below.
Clive Zietman was interviewed by James Blick, Director at TheJudge, whose words are shown in bold font.
We are delighted to have with us Clive Zietman, partner and Head of Commercial Litigation at Stewarts Law. Clive, perhaps you’d like to start by giving us a two minute elevator pitch about Stewarts Law.
Stewarts Law is a slightly unusual law firm, in that it is litigation only. It’s one of the few litigation only firms in central London and actually now the largest litigation only firm in the country, with 40 partners and about 260 staff. I’m Head of Commercial Litigation and we tend to focus on cases that are slightly anti-institutional, perhaps against banks. We do a lot of fraud work and professional negligence work and we’re very busy at the moment.
How do you see the legal sector changing at the moment and what is Stewarts doing to respond to those changes?
I think what we’re going to see is more of the big firms probably getting bigger and more “one-stop-shop” like. I think we’re going to see more specialists and perhaps a few more breakaways from the big firms. And I think you’re going to see a lot of firms with difficulties actually – particularly those in the middle ground that are trying to mimic the big firms.
Stewarts has obviously been in the press recently, both in relation to the recent success on the Commerzbank appeal and also in relation to the litigation that you’ve recently commenced against RBS. Are we seeing Stewarts becoming a hub for this type of financial group litigation action?
Maybe. Simply because – certainly in terms of actions against banks – there’s actually very few firms that will sue any bank at all, quite remarkably. So, typically, we have the big firms on the other side and they are very good referrers of work to us. Are we going to see more of that kind of work? I think we are, as a result of the economic climate. I think the fallout from the financial crisis has got a long way to run, in terms of its ramifications.
These can be large, complex and potentially very heavily contested cases. What do you find the biggest challenges are in running this type of case?
Often, one meets very vigorous resistance – huge amounts of resource are put in by, for example, a bank if they feel very strongly about the case. So, they can be very difficult to resource and some of the legal issues are often very complex, at the cutting edge. And just commanding the documents and the data, in itself, can be hugely challenging and the RBS case that has just started is going to be a very good example of that.
Do you see this type of litigation only firm really starting to pose a threat to the traditional ‘all service’ model of some of the larger practices?
I think yes, there will be others out there doing the same as us. There will be some more competition in the space that we’re in. And I think it’s sort of unpredictable as to how things are going to pan out over the next few years but I do think change is afoot.
You’ve recently opened offices in the US. Is this the start of a wider strategic move in the US on the part of Stewarts Law?
I think there are opportunities in the US that have not been exploited particularly well, either by English firms or by US firms. There are a lot of US firms that start class actions in securities cases in the US and I think, traditionally, they’ve had a lot of difficultly in actually capturing clients – despite the lack of risk – in capturing clients to participate in those claims. And what we want to do is sort of bring an English face and understanding to those sorts of cases to see if there can be more interest generated.
Many US firms are now increasing their activity in London. Is that a trend that you think is going to continue?
I think some have made a mistake in the way that they’ve done it. Will more litigators come in? Historically they haven’t – they’ve often been more sort of project finance based and general commercially based. They do worry about conflicts quite a lot. Are we going to see more litigators? I’m not sure. I think it’s becoming quite a crowded space actually, in many ways.
What proportion of your client base is domestic UK litigating in the UK versus international clients litigating in the UK?
Our practice is becoming increasingly international. I think the statistic is something like 70% of the claim forms issued are by foreign entities or individuals and we’re seeing an awful lot of that. A huge number of our clients are from abroad and also, gone are the days when everything was confined to these shores. Most cases – say, for example, a fraud case – it’s almost impossible to see how the facts would be confined to this jurisdiction alone. So many disputes now are multi-jurisdictional.
One of the challenges that the UK market faces at the moment is the Jackson reforms. What is Stewarts doing to respond to those challenges, relating specifically to the Jackson reforms?
There are challenges but, on the DBA side of things, we will look very selectively at taking risk. Our firm has taken risk for many many years – our personal injury and clinical negligence departments were built on CFAs. So we are used to assessing risk and we will participate in risk as things go forward. We are also, as a firm, making our own reserves to cover off the risks of DBA cases. I think some firms will come unstuck if they haven’t properly reserved for a case that could take three or four years.
How important is litigation insurance and third party funding to your practice?
Very important and I think that’ll continue, without any doubt whatsoever. As I say, we assess risk but we’re also mindful of sharing that risk with those that we know well. So, when we assess a risk of a case, we’re going to be looking very closely at how do we minimise that risk. There’s obviously got to be a long discussion with the client and then we, as a firm, have got to make some really important strategic decisions in each and every case as to how we handle that risk.
There’s a lot of uncertainty surrounding the true number of transactions that are actually completed, specifically in the UK. But the suggestion is that the actual volume of deals done is relatively low in relation to the attention and interest in the space. What do you think the biggest barriers to an increased uptake in third party funding are currently?
There’s only certain kinds of cases that demand third party funding. You’ve got to have – I suppose the ideal case, an almost impoverished client with a really good claim, and enough money in it to make it all worthwhile, and there aren’t so many of those claims. And I think a lot of the third party funders are chasing the same sorts of juicy cases and there’s only a finite number.
Equally, I suppose it’s not necessarily just the impoverished client – it’s also a client who’s very risk averse who wants to offload some of that risk. So, my overall impression is that there aren’t as many cases out there as some people are suggesting there are.
The biggest barrier then is perhaps the lack of available cases or the limited pool of appropriate cases. What things would you change about the third party funding market to perhaps make it more accessible to a wider pool of cases?
I mean, I’ve got some sympathy with a third party funder who’s taking a great risk. We all know what the hazards of litigation are. You know, things happen in the course of the case and a third party funder has to decide right at the outset of the case are they going to fund it. As we know all too well, witnesses don’t necessarily perform, expert witnesses don’t perform, material emerges in the course of disclosure – there’s so many variables before you even get to the courtroom that I have got a lot of sympathy really with anyone taking that risk. And, since we as a firm are taking the same risk, I think what it calls for is a bit of a partnership actually.
Do you sense that clients generally are becoming more price sensitive, both in relation to fee retainers with their lawyers but also in relation to external funding?
I think you’re right. I think institutions actually – institutions that, in the past might have been a bit trigger happy about litigation – are much more focussed than ever on cost and are trying to drive it down. So that would apply to both the legal advisers and third party funders.
You mentioned that perhaps the future for third party funding is a closer partnership with law firms. What about the other angle that the potential that UK law firms now have to act on a DBA basis may create a potential threat to the third party funding market where lawyers willing to do DBAs are essentially competing for the same sorts of cases – the limited pool of cases – with third party funders?
As it happens, I think that the wise law firms are not going to do that many cases where they bet the ranch on DBAs. So, there’s going to be a real desire I think to share that risk. I can imagine some firms making some huge mistakes over DBAs – they’ll have dollar signs in their eyes and they’ll think that Christmas has arrived with some fantastic case and then, things won’t go according to plan. And I think what the wise law firms are going to want to do is have a basket of cases – not too many, they’ll want the normal paying cases but the basket of cases – and as regards that basket, offloading some of the risk with a third party funder. So I don’t see it as a direct competition actually, I see it much more as a partnership.
One of the debates that surrounded DBAs, particularly during the Jackson review and prior to implementation of the LASPO Act, is this question of conflict of interest. Does the fact that the lawyer is now incentivised by a percentage of damages mean that they have to step round to the other side of the table when negotiating the fee deal with the client and does that put them into a position of conflict with their client?
I think the reality is that actually a good litigator just wants to win anyway. And wants to do the best for their client, come what may. I think historically there often has been a little bit of tension and give and take, particularly in a settlement negotiation, pre DBAs. I’ve been in mediations where we’ve given a little bit, in terms of our fees, to make the settlement happen. There’s all sorts of costs involved – the barristers too. OK, a third party funder might have to take a view, an ATE insurer might have to take a view – if everyone’s in a mediation and a deal’s on the table, it might be better to grab the available deal than to carry on litigating. So, I don’t think the tension is a new one actually.
Do you think if the downside risk of a DBA, or a CFA for that matter, could be managed that the firm would be more inclined to take on cases on that basis?
We are going to have to up our game in terms of the whole process. Then, we will be more inclined to do it. As I say, I can’t see us really putting all our eggs in one basket on one case that demands massive resource if it means that we’re going to be quivering in our seats in four years’ time, hoping for the result that we all dream of. I just don’t think it’s going to be like that.
Litigants are changing generally the way in which they approach litigation. We discussed that they’re more cost conscious but do you think they’re changing their attitudes in other ways versus years gone by?
I do. I think they’re more conscious of cost actually. I think the change that occurred – I suppose it was ten years ago odd now – where interim costs were awarded as the case progressed. There used to be an attitude, I suppose 15 years ago, of just sue and get on with it and now people are much more wary about the downside. They are interested in instruments that can lead to early settlement – Part 36 offers, mediation, any of the tools that are available to litigators to get cards on the table and get a deal done. Our clients are very interested in that and will certainly be very interested in DBAs.
And if you were a client in the position of looking to embark on a substantial piece of litigation, how would you go about selecting a law firm to run that case for you?
We know who the excellent litigation firms are but actually, often it turns on which particular individual they get on well with. There are good and bad in the biggest of firms and the most reputable of firms. I think some have become somewhat complacent, trading on their name. Often it’s down to who is the actual person you’re going to be dealing with – that would be the key issue for me.
How do you manage a client during what can be a very lengthy and potentially very expensive process?
We have a lot of clients who are individuals – often wealthy individuals but they care about the case and they care about their money. So, managing their expectations is a huge issue and keeping them informed, alerting them to the risks – especially on the costs side – and keeping everything under control so that they don’t get any surprises is a huge challenge.
One of the discussion points that’s been going on recently is this question of whether legal services is becoming increasingly commoditised. Do you find that the firm is having to increasingly tender for business against other firms?
You’ll see prospective clients coming along and trying us out and interviewing us, and going to some quite extreme lengths in terms of asking for references and all sorts, and experience statements – that’s happening much more than it ever did before.
How effective do you think the UK Courts are today at controlling costs in litigation?
I think the problem is one of resource. I know that there’s been a lot of good intention out there but the judges, actually, battle to do their most basic job let alone case managing in the very intrusive way. The fear is very much that the Court should be very much interventionist – in reality, I don’t think that’s quite played out in that way. That may change.
What do you think makes somebody a good litigator?
Actually, it’s somebody who’s very very thorough. I think there’s a mystique surrounding some lawyers – you know, “I want a really aggressive lawyer” – naked aggression is actually nonsense. The impression’s often given that some lawyers eat powdered glass and raw meat for breakfast. In reality, cases are about thorough preparation. You’re not playing to a jury in the English Civil Courts, you’re playing to a very sophisticated judge who’s going to decide the case on evidence, not on gut feel.
One trend that’s been suggested recently is that there is a greater inclination to look at arbitration as a mechanism to resolve disputes as opposed to the Courts. Do you prefer the litigation route or the arbitration route?
A lot has been suggested about arbitration as being quicker and cheaper and, actually, my experience has been the complete opposite. Arbitration can be very expensive – you’ve got to pay for the arbitrators – and if they’re not available, there’s all sorts of other issues in play. It often isn’t quicker either. So I suppose I’m a bit old fashioned and I can see the advantages of litigation. The biggest advantage of arbitration I suppose is often confidentiality.
What made you decide to become a lawyer, other than possibly the diet of raw meat and crushed glass?
I suppose I’ve always liked competitions. Why was I a litigator – I was never going to be any other kind of lawyer – I like games, I like sport and I like winning.
Do you think Associates today have it easier than when you were at that level?
I think the demands – the financial demands – the pressures of the job have increased. The pressures on time recording and all the regulatory stuff – I think it’s much much tougher. And the job market of course is so much harder – when I first qualified, it was very easy to get a job. Now, it’s really tough and the CVs that I see of young lawyers are incredibly impressive – it’s hard for them.
What’s your favourite pastime when you’re not working?
Despite my antiquity, I still participate in five-a-side football so, you see, the aggression and the competition is still there. So, that’s what I like doing. I lead a sedentary life and I need to expend energy as well still. So, that’s what keeps me sane.
Who would be your two ideal dinner guests, living or dead?
I’d quite like to have dinner with Mahatma Gandhi and Bill Clinton at the same time – I think that would make for a very interesting conversation.
It’s been an absolute pleasure talking to you. Thank you very much for taking the time.