THE Governor of the Bank of England last night delivered a ferocious attack on Britain’s civil legal system, condemning it as a monopoly run mainly for lawyers’ benefit and urging the Government to reform it.

Mervyn King told City leaders at the Mansion House in London that the Bank’s painful experience of the 13-year case brought against it over the collapse of Bank of Credit and Commerce International (BCCI) showed that the system of civil commercial law was gravely flawed.

Denouncing the case and its £100 million in legal costs as “the most expensive fishing expedition in history,” Mr King said: “It matters that there are simple, clear and timely ways of resolving disputes. What the BCCI case revealed was a legal system incapable of guaranteeing that.”

The Governor cited a 2003 lecture by Mr Justice Lightman, who argued that the huge costs imposed by adversarial civil courts meant that “to the great majority of the public, the perception, if not the reality, is that the legal system is a profitable monopoly of lawyers”. Mr King said: “BCCI showed that perception was indeed reality.”

He noted that the action against the Bank of England over its role in BCCI’s 1991 collapse had set new trial records. “How can a case described by the trial judge himself as built ‘not even on sand but on air’ take 13 years and over £100 million in costs to come to a conclusion?” he asked.

“It is for others to comment on the behaviour of those who brought a case even they described as a blood sport . . . A system that is powerless to prevent a case so hopelessly misconceived continuing for 13 years requires examination.

“I very much hope the Government will . . . take steps to ensure that such an outcome can never occur again.”

A Law Society spokesman said: “The BCCI case was extremely unusual but there are clearly lessons to be learnt from it.”

The Governor’s attack on the legal system and the “blood sport” of litigation comes at a moment when judges feel under siege over sentencing levels in the criminal courts, after John Reid, the Home Secretary, criticised them over so-called “soft” sentencing.

Mr Reid’s remarks prompted the Lord Chief Justice, Lord Phillips of Worth Matravers, to express “grave concern” that such attacks can undermine public confidence in the judiciary.

While Mr King’s broadside on the legal system’s costs and delays cannot be seen as a threat to judicial independence in the same way as attacks on individual judges over sentences, it does expose another aspect of the justice system that some see as not fit for purpose.

The huge expense and delays involved in litigation were exposed in 1991 in a landmark report by Lord Woolf, later the Lord Chief Justice, and the reforms he recommended were aimed at tackling the problems.

But although most litigation is now speedier, it remains immensely costly — a barrier to justice for all but the wealthy, and judges periodically criticise it themselves.

The Lord Chancellor, Lord Falconer of Thoroton, has embarked on reforms aimed at keeping lawyers out of disputes wherever possible, and at ensuring that people’s problems are resolved out of court by alternatives such as mediation or arbitration.

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