The Fourth Section has now held in Coventry v United Kingdom 6016/16 that the dissenting minority of Deputy President Baroness Hale of Richmond and Lord Clarke of Stone-Cum-Ebony was right in Coventry v Lawrence 2015 UKSC 50 to consider that such recovery was a breach of Article 6 (access to justice) and the First Protocol (protection of property). The aim of the domestic scheme was legitimate, but the means involved a disproportionate interference with the principle of equality of arms. 

The system singled out from the class of unsuccessful litigants those who happened to be opposed by a party with CFA and ATE and required them to provide funds which could in theory be used for unrelated, unsuccessful litigation which had been conducted by the successful party’s lawyers. Although the costs regime has changed since the Coventry v Lawrence litigation there remain pipeline cases - and cases that litigants may now seek to reopen.  An open question is whether in pipeline cases domestic courts will feel bound by the Supreme Court decision or view it as now effectively superseded by the technically non binding Strasbourg decision. The Strasbourg Court has also left open the question of the effect of any legal costs insurance and whether litigants and lawyers in pipeline cases may recover their success uplifts and insurance premiums from the UK Government if not their opponents on the basis of a legitimate expectation. 

Robert McCracken KC of Francis Taylor Building, leading Sebastian Kokelaar of 3 Stone Buildings Lincoln’s Inn, acted for Mr Coventry, the successful applicant before the Strasbourg Court