There have been a series of costs decisions in the British
Virgin Islands ("BVI") that had created
a degree of uncertainty about the recovery of foreign lawyers'
fees. They preceded and followed the enactment of The Legal
Professional Act, 2015 ("LPA"), which
changed the way practitioners are regulated and parties may recover
Previous Position at Common Law
With some shifting of positions, the common law position on
recovery of foreign lawyers' fees in the BVI, was reflected in
the following cases:
Michael Wilson & Partners Limited v Temujin
Grand Pacific Holdings Ltd v Pacific China Holdings
Olive Group Capital Limited v Gavin Mark
MayhewBVIHC (Com) 2015/115
Fees of foreign lawyers are generally
recoverable as a disbursement of local legal practitioners.
The fees must be justifiable and
The bill of costs must give full
details of the charges incurred by those foreign lawyers.
The fees should be calculated at the
appropriate rates in the foreign country, but must be proportionate
and necessary, as judged by local standards.
LPA came into force on 11 November 2015. It included
restrictions on the practice of BVI law to a strict practicing
certificate regime. However, s. 2(2) providing that "Save
as the context otherwise requires, any reference in this Act to
practising law, shall be construed to include a reference to
practising Virgin Islands law outside the Virgin Islands"
was not brought into force and was repealed on 29 January 2016.
In Dmitry Garkusha v Ashot Yegiazaryan &
OthersBVIHCMAP 2015/0015 (handed
down in 2016), the Court of Appeal construed the LPA and found
costs of foreign lawyers irrecoverable and the foreign law firm in
that case was found to have breached the criminal law. However, the
Court made its decision unaware that s. 2(2) had been repealed.
Subsequently, in John Shrimpton & Anor v Dominic
Scriven & Ors (unreported): Eder J [Ag] found
that the Commercial Court was bound by
In John Shrimpton & Anor v Dominic Scriven &
Ors BVIHCMAP 2016/0031, handed down in February 2017,
the Court of Appeal held that, although s. 2(2) was not in force,
the Court of Appeal would not have reached a different decision in
Garkusha and was bound to follow it. S.
18(3) of the LPA means that the costs of a foreign lawyer whose
name is not on the Roll can no longer be recovered as a
disbursement and may not be acting as a legal practitioner. The
common law position therefore should now be disregarded.
What it is 'to do the work of a BVI legal practitioner'
is key to the position going forward. It was given a broad
interpretation by the Court of Appeal in
Shrimpton, finding that it is
"undeniably wide and general and may incorporate any number of
activities". However, no definitive answer was given and it
will no doubt be within that broad interpretation that further
costs decisions of the BVI Courts develop the law in this area.
The decision clarifies the uncertainty that arose following the
decision in Garkusha as to the position
on foreign lawyers' fees and places the jurisdiction on the
same footing for practice requirements as various other
jurisdictions, such as Hong Kong, Cayman, and Bermuda.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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