Leading commercial sets are stepping up their use of conditional fee arrangements (CFAs) as law firms and clients increase pressure to cut counsel costs.

Some of the profession's top silks and chambers are taking on cases at reduced rates in return for an uplift if the case is successful – a practice that was until recently unheard of at the commercial Bar.

Addleshaw Goddard, a strong proponent of third-party litigation funding and after-the-event insurance, is also separately in talks with top sets including Brick Court, Fountain Court and Essex Court Chambers to encourage them to use CFAs. Sign-up from barristers is likely to make Addleshaws' cost-free litigation scheme more attractive to clients.

Brick Court has already separately taken on seven cases on a CFA basis this year – including one involving a silk.

Barristers at several other sets are also thought to be seriously considering CFAs.

Addleshaws litigation head Simon Twigden (pictured) commented: "A big chunk of fees in significant litigation are taken up with counsel costs. There has been a general lack of understanding and fear among barristers that CFA equates to "no win, no fee". This stigma among the commercial sets is clearing, as litigation funding methods are increasingly in demand."

He added: "More and more big names at the Bar are saying yes to a serious consideration of this. We increasingly factor this in when we make recommendations to our clients on which barristers to use."

The move sees chambers follow the lead of law firms, which have increasingly been using CFAs and other alternative fee arrangements during the economic downturn.

The interest has led litigation funder Allianz to plan a commercial litigation funding conference with No5 Chambers to be held in June.

In addition to CFAs, there is also growing momentum for chambers to move away from hourly rates through fixed fees and cost capping.

Chairman of the Chancery Bar Association, Michael Todd QC, said: "In the past we have worked to an hourly rate as that was what was previously demanded by solicitor firms and their clients. Now there is an increasing demand coming from the other direction, with clients wanting more than ever to have certainty as to what a piece of work will cost and, in certain instances, wanting fixed fees and caps where possible."

Specialist funding broker Calunius Capital founding member Mick Smith said: "It is certainly the case that the Bar is becoming more open-minded on payment arrangements. Given the increasing pressures on clients to reduce and manage their costs, there is more willingness among the Bar to work alongside solicitor firms and act on a CFA basis or consider payment methods such as fixed fees and costs capping. This is only set to increase in the economic conditions."

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