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The sorts of litigation banks get into tend to involve claims of art least hundreds of millions of pounds, and typically banks are on the wrong end of them — it is an unusual investment bank that makes a habit of suing its own, solvent clients — meaning that, unless it is prepared to just admit everything and pay up— this happens a lot more than you would think, thanks to an inverted instance of the agency problem — the bank has little control of the process. Unlike a commercial transaction, there is no critical path, since you don't know how the other side will play, so it is hard to fix or even estimate fees, so “[[time and attendance]]” tend to be the order of the day. | The sorts of litigation banks get into tend to involve claims of art least hundreds of millions of pounds, and typically banks are on the wrong end of them — it is an unusual investment bank that makes a habit of suing its own, solvent clients — meaning that, unless it is prepared to just admit everything and pay up— this happens a lot more than you would think, thanks to an inverted instance of the agency problem — the bank has little control of the process. Unlike a commercial transaction, there is no critical path, since you don't know how the other side will play, so it is hard to fix or even estimate fees, so “[[time and attendance]]” tend to be the order of the day. | ||
Anyone who has contemplated litigation — | Anyone who has contemplated litigation — if you’ve ever done a loft conversion, that probably includes you — will know how dismal the experience of seeking legal redress through civil procedure can be. Many phases of civil litigation — pleadings, discovery, interlocutories, counterclaims, requests for further and better particulars, witness statements — are time-sinks that exist only for lawyers to spin each others’ wheels, at their respective clients’ expense — and the result is to render litigation utterly futile for a claim below about £10,000,000 — since the cost of pursuing or defending the claim will outstrip any conceivable dividend of success. | ||
Above that threshold, this no longer holds: there is a hazy interregnum where lawyers know they can be paid handsomely, indefinitely, for carrying on an argument that most likely will never get to court, let alone final adjudication. | |||
{{Sa}} | {{Sa}} |