Although a recession spells misery for some, for many barristers it is time to make hay while the sun shines. Downturns spawn disputes – as does an increasingly legislation-happy government – and while 2009 was largely a time for parties to assess their legal positions (thus boosting barristers’ advisory workload) the widely anticipated litigation boom now finally looks set to begin in earnest.

James Maurici, a planning and environmental specialist at Landmark Chambers, says that although planning suffered during the recession – with housebuilding and inquiry work both hit – the slowdown has not been as bad as expected. ‘Energy and infrastructure projects are going to be a major source of work. Also there seems to be more High Court litigation in the planning sector, even if inquiry work has dipped.’

Maurici predicts a surge in advisory/litigation work in his sector thanks to the Planning Act 2008 (and the concomitant consideration by the Independent Planning Commission of its first applications for consent), and the government’s adoption of national policy statements (NPSs) on ‘nationally significant infrastructure projects’ such as nuclear power generation, renewable energy and electricity networks.

‘The government claims the Planning Act will give communities a "far greater say" on such projects. However, many say communities will feel increasingly disenfranchised by the process leading to the grant of a development consent. This will make more likely court challenges to the development consent ultimately granted, or to other decisions, including the adoption of an NPS. Such challenges may be seen as the only remaining genuine opportunity to air objections to such proposals,’ he says.

A plethora of new and forthcoming legislation – including the Consumer Credit Act (CCA) 2006 and the 2008 Consumer Credit Directive – coupled with the credit crunch, will produce a hike in consumer credit litigation in 2010, says Richard Mawrey QC of Henderson Chambers.

‘The credit crunch has fuelled the "surge" in litigation in this area and the surge will continue until every possible loophole in consumer law has been exploited and dealt with by the courts,’ says Mawrey. ‘It is also likely that the regulators will increase their activities, particularly the Office of Fair Trading, which will obtain a considerable injection of funds from its cut of the new charges for consumer credit licences.’

There has been a huge increase in claims-farming and solicitors taking on bulk cases, attempting to exploit loopholes in the CCA to free people from their consumer credit debts, he says. ‘As the consequences are potentially serious for lenders, these cases tended to be fought tooth and nail and appealed by the unsuccessful. At the same time, the regulators, particularly the Financial Services Authority and the OFT, have been hyperactive in interfering with established practices such as payment protection insurance.’

The insurance and reinsurance sector has also seen a huge rise in instructions, says Simon Rainey QC of Quadrant Chambers, with marine, energy and financial institutions particularly active. ‘It is difficult to say why these areas are thriving, but it is probably related to the volatility in financial and commodities markets, the poor performance of many investments and recent fraud.’

Assureds, he says, are more willing to aggressively pursue insurers for indemnities and seek remedies for what they consider to be late payment of claims. Credit risks, financial institutions and related professional negligence will be the big areas of litigation/advisory work in 2010, he predicts, while the Law Commission’s review of insurance law may have an impact if its recommendations are enacted.

The effects of the downturn are rippling through to produce more work in the aviation sector, says Quadrant Chambers’ Robert Lawson QC, with debt-related work up. ‘This is particularly noticeable in asset finance work, where instructions concerning default of aircraft purchase agreements and leases are rising, particularly in relation to general aviation, as the once-rich run into difficulties funding their executive jet habits.’

Recessions, he says, have a time-lag in litigation terms, so debt-related work is likely to occupy barristers in this sector for the foreseeable future, while the European Court of Justice’s decision regarding EC regulation on compensation for delay and cancellation will also lead to a flood of litigation against air carriers.

Recessions herald job cuts and, since slumps make it harder to find new posts, more disgruntled ex-employees are fighting lay-offs. ACAS’s annual report for 2008-2009 showed a 29% increase in unfair dismissal claims referred for conciliation and a 36% rise in redundancy claim referrals. Rises of 29% and 48% respectively in such claims were lodged with the Employment Tribunal System.

Jill Brown, a barrister at Outer Temple Chambers, says the rise in unfair dismissal and redundancy cases will provide plenty of work for the junior bar in 2010, but it is probably discrimination claims that represent the important growth area. ‘The enormous increase in equal pay claims in the past five years remains the single most significant development for practice in general. The number of equal pay cases reaching the appellate courts has mushroomed in recent years,’ she says.

Clive Sheldon of 11 Kings Bench Walk says age discrimination looks like taking on a higher profile in the coming year as older employees begin to appreciate the benefits of the legislation.

‘Lots of equal pay cases are keeping employment lawyers busy. The Equality Bill, if it becomes an act in 2010, will impact on financial institutions with obligations of openness in pay schemes. There is also an increase in business competition claims, with valuable employees moving between firms in potential breach of restrictive covenants,’ he adds.

He predicts more work for the employment bar in the near future, but also more competition ‘as solicitors do more and more advocacy, and barristers flee less busy/lucrative areas of work to muscle in on employment law’.

Simon Ray, a criminal barrister at 6 Kings Bench Walk, says that since the recession started to bite, those in the criminal fraud/regulatory sector have been predicting an increase in fraud prosecutions.

‘It is also expected that regulatory bodies that were previously content to use civil disciplinary sanctions will increasingly look to use their powers to prosecute. There is also likely to be an increase in corruption cases.’

He predicts a rise in the number of arrests for ‘white collar’ crime and in litigation concerning, for example, the retention of DNA and fingerprints, together with more ancillary litigation in areas like restraint, confiscation and civil recovery.

James Dawes, of 2 Harcourt Buildings, says the inexorable rise in prosecutions for money laundering offences will continue to prove a fertile area of advisory work as professionals who handle client funds are particularly vulnerable to such accusations.

‘Fraud is expensive to investigate, expensive to prosecute and expensive to defend. The penalties for fraudsters are often low relative to other more newsworthy crimes. This makes it ripe for budget cuts in the police and the prosecution authorities. This would prove a false economy in my view, as fraudsters are on the rise but may prove tempting to an austerity-minded regime.’

According to Sasha Wass QC, a criminal barrister at 6 Kings Bench Walk, there is much more fraud work around of all levels. ‘One of my concerns is that financial constraints influence the question of whether to prosecute offences at all. This will not boost public confidence in the criminal justice system.’ She says the introduction of in-house lawyers taking on court cases beyond their capability has led to a drop in the general standard in the way cases are conducted. She also predicts a greater division between publicly funded and privately funded work.

Commercial fraud specialist Michael Patchett-Joyce of OTC says the domestic and EU regulation of financial services will be a significant area of work in the coming year. ‘Certainly such work will involve advice on compliance, but might also involve vires challenges and, thereafter, civil, criminal and regulatory litigation. I would also expect that mis-selling claims, already a feature of pensions work, will become more widespread across the sector.’

Andrew George, commercial law barrister at Blackstone Chambers, says there has been a particular increase in regulatory investigations and enforcement arising out of the government bailout of the banking sector. ‘Increasingly, and no doubt due partly to the election looming next year, debates about the future of regulation are becoming more politicised and of greater relevance to the country’s wider economic issues. There is also the beginning of an increase in claims for the alleged mis-selling of financial products and mismanagement of portfolios. Frauds usually become more apparent in times of market volatility,’ he says.

In the Commercial Court at present, he says, there is also complicated litigation arising out of the break-up of the former Soviet Union (including the case brought by Boris Berezovsky against Roman Abramovich, which Abramovich contests, in which George is instructed). He says: ‘In terms of the changing nature of the work, regulators are more willing to test the limits of their powers by imposing more extreme sanctions than they might have done previously. Consequently, individuals affected increasingly have little to lose by mounting challenges to regulatory decisions.’

Tim Howe QC, a commercial dispute resolution specialist at Fountain Court, says high-value commercial disputes are rife, and involve investors, funds, banks and/or fund managers, and particularly with reference to leveraged investments in complex structured products, plus asset-backed securities, credit default swaps and a range of notes, bonds and other investments that lost value as a result of the credit crisis, causing substantial losses.

He adds: ‘The events of 2008 generated a lot of advisory work as the affected parties worked through their legal, strategic and tactical positions, ascertained their rights and obligations, evaluated their claims and/or exposures, and took advice on the appropriate steps to protect their positions and prepare their cases in anticipation of bringing or facing claims. However, claims are [now] being commenced and pursued to a significantly greater extent, and this has resulted in the nature of the work changing more to active litigation.’

Professor Mark Watson-Gandy of 13 Old Square says insolvency was not as busy in 2009 as expected. ‘This is probably because even the living dead seem bent on only "going down fighting". If anything, 2009 was the "year of the welch". Companies tried to find defences or counterclaims to re-haggle their exposure on borrowing. Directors tried to wriggle out of guarantees. Banks tried to renege on or renegotiate terms of lending.’

This doesn’t mean more insolvencies aren’t coming, he says. ‘After all, litigation is not the most financially sound way to extend your borrowing terms. It just means it is taking longer than expected for companies and debtors to teeter over the brink. The fallout will happen. It just looks as if it will take three to four years before the credit crunch’s full effects find their way into the courts.’

Serle Court commercial barrister John Machell says the fallout from the credit crunch will mean more cases raising specific banking, finance and insolvency issues, plus an increase in the number of disputes between business owners, partners and joint venturers caused by the strain of the economic situation.

Machell says his sector has been affected dramatically by the increase in the number of partners being made redundant. ‘Over recent years, there has been a strong trend in favour of the inclusion of no-fault expulsion clauses in partnership and LLP agreements and, although most departures have been by agreement, agreement has often been driven by the threat of the exercise of the power to remove. The removal of significant numbers of partners in this way has caused a considerable amount of unease among rank-and-file members of many firms, and what the long-term cultural impact of this may be remains to be seen.’

Outer Temple Chambers barrister Charles Foster says disciplinary and regulatory lawyers are happily frantic, with plenty of work in all corners of the speciality: healthcare, police, financial services and so on.

Foster explains: ‘We are increasingly a whingeing, complaining society. The public increasingly knows about its rights and the corresponding professional responsibilities. There also seems to be an insatiable human appetite for conflict, and litigation is one of the ways of sating that. As funding for other types of litigation dries up, people look elsewhere to meet their need for vindication. To make a complaint to a professional body costs the member of the public nothing, and creates a gratifying amount of havoc and media attention.

Energy, construction and international arbitration are all thriving, says Lionel Persey QC of Quadrant Chambers. ‘There has been a significant increase in the number of instructions coming to the bar in offshore construction/shipbuilding cases over the past year. Parties are looking to get out of their contracts or to renegotiate them on more favourable terms. The international arbitration sector will be very busy over the next two years as the credit crunch continues to take its toll and disputes work their way through the system.’

The recession might be maintaining its grip, but in the realms of consumer credit, fraud and insolvencies – and a host of other practice areas – barristers face a busy 2010 as serious thought is given to litigation.

Lucy Trevelyan is a freelance journalist