Pre-Court Settlement & Client Awards
High-Quality Litigation Reward Analysis (High-Quality LRA) captures uncertainty and judgement to present a range of outcomes of a case. These outcomes can be converted into a settlement figure expressed as a confidence range, so that both counsel and the client are aware of their expected reward and the minimum and maximum reasonable outcomes around that central expectation.
A further advantage is that any settlement offer can be assessed as to its reasonableness, and the probability of an actual proposed settlement figure being higher or lower than the proposed settlement can be assessed.
Court Strategies
Dashboard analysis can assess different strategies with different probabilities in “real time”. This analysis is a powerful tool for running different scenarios—for example, high risk/high reward strategies versus more conservative ones.
Contingency Fee Arrangements (CFAs)
Numerical analysis of expected rewards—weighted by the overall probability of realisation—can provide a basis for estimating a reasonable contingent fee arrangement.
LRA & the Law
In Motto v Trafigura Limited [2011] EWCA Civ 1150, the Master of the Rolls found that is “necessary to attribute quantitative risk assessment to the potential problems” when determining Contingency Fee Arrangements.
However, the crude use of probability based risk/reward assessment was heavily criticised:
- Over the artificial precision of presenting a single figure probability of success; and
- Over the “highly questionable” assumption that each individual risk is entirely self-contained.
High-Quality LRA is aware of these issues. Every estimate, whether the probability of a particular judgement, or an effect of a judgement on an outcome, should be expressed as a range between the minimum and maximum credible figure.
Furthermore, risks are very rarely self-contained. One judgement in a sequence can affect the following one, and the first judgement should always be taken as revealing something about the Court’s sentiment. Probabilities should be expressed in contingent terms—i.e., the probability of B happening given that A must have already happened leading to the possibility of B.
