By Matthew Kain, Chief Executive Officer of the Kain Knight Group

Litigation funders are set to face closer pre-investment scrutiny of retainers and ongoing cost monitoring. This arises from a recent High Court decision in a case brought by Brazilian billionaire Alberto Safra against the US law firm, WilmerHale.  

On 24 March, Safra won a review against WilmerHale in the High Court, Senior Courts Costs Office (SCCO): Safra v Wilmer Cutler Pickering Hale and Dorr LLP [2026] EWHC 703 (SCCO). Although WilmerHale is a US-headquartered firm, the SCCO had jurisdiction because the firm provided legal services through its London office as an SRA-regulated LLP in England and Wales.

The SCCO decision provides significant guidance on transparency, contractual certainty, and billing practices under the Solicitors Act 1974.

Safra had been represented by WilmerHale for nearly two years in a dispute over the $23 billion estate of his late father, Brazilian banker Joseph Safra, and requested that the High Court assess a number of the firm’s invoices.

Of the total WilmerHale bill, which amounted to $35.3 million (£26.2 million), Safra paid $16.4 million but challenged the remaining balance of $18.9 million.

The costs judge, Colum Charles Leonard, refused the firm’s application to compel Safra to pay the $18.9 million and ordered a full assessment of the law firm’s bill for arbitration fees for representing him in five London Court of International Arbitration (LCIA) proceedings. In evidence, the court heard that Wilmer charged Safra more than $162,000 in a single day, with partners billing $2,095 an hour, $265 above the initially agreed 2022 rate.

“I have not previously encountered a case in which such levels of costs accrued with such limited information being provided to the client,” said Costs Judge Leonard in his ruling. He added: “Throughout all of the invoices, there are charges which are so high as to raise concern.”

He referenced WilmerHale partner John Trenor’s charges for 19.3 hours in one day and another 24-hour period in which nine of the firm’s fee earners billed for 130.2 hours. The judge also pointed out that WilmerHale had initiated two separate hourly fee rate increases, totalling 14%, without once notifying Safra. “The need to raise them (rates) further (so quickly, and by so much) calls for an explanation,” said Costs Judge Leonard before ordering a full assessment of WilmerHale’s bill.

Judge Leonard raised another point of notable interest to funders. WilmerHale argued that the monthly statements which it sent to Safra were “interim statutory bills,” so the time limit to challenge the earlier invoices had already expired.

The court found that these monthly invoices lacked the finality required to be interim statutory bills. Collectively, they formed a single continuous demand for payment known as a “Chamberlain bill”, which was delivered on 17 September 2024 after the retainer had been terminated. Because Safra applied for assessment within three months of delivery, he had an automatic right to a review under Section 70(2) of the Solicitors Act 1974.

So, what are the wider lessons of this decision for those involved in high-value funded disputes?

Although Safra’s case concerned a solicitor-client assessment, the decision has potential ramifications, both for litigation funders and for the parties involved in such high-value disputes. Where legal costs are invariably substantial, the terms, management and communication of those costs are likely to come under much closer scrutiny in future as a result of this decision.

In the Safra case, the court rejected WilmerHale’s reliance on the contentious business agreement (CBA) framework and ordered assessment on a standard retainer basis. In reaching his decision, the costs judge raised concerns regarding the level of information that was provided to the client about costs, including significant hourly rates and further increases to those rates during the course of the instruction.

The precedent set by the court’s decision means that costs exposure in large funded litigation needs to be monitored carefully and regularly throughout the life of a case, rather than being reviewed only once costs are challenged or assessed.

At a practical level, solicitor-client assessments of this nature can often become lengthy and hard fought, particularly where the parties’ positions are entrenched and the sums at stake are substantial. There is an evidential burden on the receiving party to justify the costs claimed, which makes the maintenance of contemporaneous records to support hourly rates and time spent of key importance.

Similarly, litigation funders need to pay close attention to retainer terms, costs updates, hourly rate increases and the level of detailed information provided to clients about likely costs.

Solicitor-client assessment proceedings can have a significant impact on assumptions relating to legal spend, recoverability and the overall costs risk attached to a funded claim.

To prevent creeping fees from diminishing their overall returns, greater transparency will require funders who back complex disputes to demand that law firms provide detailed and itemised cost estimates at the outset. They will also need to review the billing practices and SRA compliance of the law firms whose fees they are funding, particularly in relation to how often and when clients are informed of increased costs and billable hours.

Clear, consistent and regular communication is imperative: any material changes which are made to fee rates, or other factors relevant to those ultimately paying the bill, during the course of proceedings should be clearly communicated to all the relevant parties in advance.   

There are several practical implications of the Safra decision for litigation funders, law firms and parties involved in high-value funded disputes. On costs oversight, record keeping and client communication, the lessons are clear.

Failure to provide clarity and comply with billing requirements increases legal and financial compliance risks for funders. To minimise the likelihood of solicitor-client assessments becoming protracted or contested and to mitigate the risk of an adverse outcome, transparency and communication are equally imperative for law firms and funders.