Solicitors deny exploiting miners

Mr Beresford earned almost £17m in 2006

Two solicitors accused of dishonestly taking cuts from miners' compensation have defended their right to earn millions of pounds from the pay-outs.

Jim Beresford, 58, and Douglas Smith, of Doncaster-based Beresfords Solicitors, have denied 11 counts of serious professional misconduct.

The Solicitors' Disciplinary Tribunal heard the men made huge profits through a government compensation scheme.

QC Alan Gourgey said there was nothing wrong with the firm earning fees.

Timothy Dutton, acting for the Solicitors' Regulatory Authority (SRA), has said the solicitors had failed to act in the interests of clients.

As matters have turned out it is undoubtedly the case that the level of claims and the success rates were far higher than expected Alan Gourgey, QC

He earlier told the hearing they had not given adequate advice and had entered into conditional and contingency fee agreements against their clients' best interests.

Mr Gourgey, appearing for the men, said: "We say that there is absolutely nothing wrong in a firm earning substantial fees from the conduct of its business.

"At the time when these negotiations were taking place there was a considerable uncertainty as to how many claims there would be.

"As matters have turned out it is undoubtedly the case that the level of claims and the success rates were far higher than expected.

"That has meant that solicitors who have invested in being able to manage large numbers of these claims have received substantial fees from the Department of Trade and Industry (DTI)."

'Invested heavily'

The firm acted in more than 83,000 cases of chronic obstructive pulmonary disease and more than 145,000 cases of vibration white finger (VWF).

Mr Gourgey said "matters could have turned out very differently" if the levels of success had been lower and the company, which invested heavily in IT and premises, could have faced bankruptcy.

The firm received a letter from the Law Society in 2005 which was the first intimation of alleged breach of rules, the tribunal was told.

Mr Gourgey said: "Conditional fee agreements on the scheme claims were all entered into many years ago and it must be remembered, and is often forgotten, that they amounted to less than 1% of the scheme claims conducted by Beresfords."

'Not improper'

He said long before receiving the letter from the Law Society, the firm had stopped such agreements and had subsequently refunded success fees.

Mr Gourgey said guidance from the Law Society was issued after the relevant time, even though the Society had been aware such arrangements had been going on for many years.

He said: "It's very easy in a case such as this to judge them with the benefit of hindsight, with the benefit of material which was not available to the respondents at the time."

Referring to allegations that money was improperly diverted, Mr Gourgey said there was "no cogent evidence" and said the allegations were "a mixture of speculation or unsound inference".

He also argued the contingency fee agreements were not improper to enter into under law.

The hearing continues.