Habits: Costs row could scupper action against tobacco firms

The tobacco industry is being accused of using its financial muscle to stop legal action by cancer victims in the United Kingdom. If it succeeds, writes Michael Streeter, it will affect not just the current case, but the whole future of the much-vaunted no-win, no-fee procedure.

The fate of a long-running and high-profile case against Britain's two largest tobacco firms depends not on the evidence of the 43 plaintiffs and their debilitating conditions, but on a procedural technicality.

Judges in the Court of Appeal will be asked to rule on issues which could scupper the case before a single shred of medical evidence is heard.

The simple question, being posed by the tobacco firms Imperial and Gallaher is: should they win, who will pay their costs which could reach pounds 20m?

The plaintiffs have been refused legal aid and the solicitors Leigh Day are taking the case on a conditional, no-win, no-fee basis.

Clearly the individual lung cancer victims cannot afford such a bill - and lawyers for the tobacco firms are seeking details of just who will be liable, and whether Leigh Day is in effect funding the case itself. They could then claim that the plaintiffs' lawyers are equally liable for any costs.

All parties to the case are now bound by a gagging order, though before it was made the senior partner, Martin Day, said his firm could not go ahead with the case if it was forced to bear the costs.

In the circumstances it would be very unlikely for any other legal firm to pick up the case. However, the implications go wider than just the tobacco case. If the Court of Appeal rules that Leigh Day is responsible for any costs, it will undermine the Government's attempts to substitute legal aid cases with more conditional fee arrangements.

Ian Walker, vice-president of the Association of Personal Injury Lawyers, said the whole future of conditional fee arrangements (CFAs) were at stake. "If there is any suggestion that the plaintiff's solicitors can be personally liable for the defendants' costs it throws the whole structure of CFAs out of the window," he said.

Peter McDonnell, a Dublin solicitor who is bringing similar action against four cigarette companies in Ireland, is not surprised by the tobacco industry's tactics in London. "They hope that the costs will blow the case out of the water. That is their tactics, they have multi-millions of pounds."

Mr McDonnell, who is bringing action against Gallaher (Dublin) Ltd among others, said the industry was trying to "bankrupt" him, but unlike the British case, he was hoping for government money to fund the action.

Clive Bates, director of ASH, the anti-tobacco organisation, agreed that the issue of costs was a serious attempt by the industry to delay or even stop the legal action.

"They are trying to delay the time when evidence about lung cancer is heard. That's when their investors get nervous."

However, he believes that the case will eventually come to court on the main issues - some time in 1999: "I cannot see that procedural issues will be allowed to stop this."

A spokesman for Gallaher said that the company was bound by the gagging order and could not comment.