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A RADICAL overhaul of the running of the Princess Diana memorial fund was pledged last night, just days after its legal team caused uproar by charging [pounds sterling]500,000 for 11 weeks work.

The charity moved to loosen its links with Mishcon de Reya, whose lawyers have been charging up to [pounds sterling]250 an hour and where one young employee asked for [pounds sterling]20,000 for a month's work.

In a tersely-worded statement, trustees of the multimillion pound fund insisted they had 'confidence' in the firm and had passed a unanimous vote of confidence in its senior partner, Anthony Julius, which means he will continue as acting chairman of the fund.

For the time being, the firm will continue work it has already started, including safeguarding intellectual property rights to prevent bootleggers cashing in on Diana's death.

But the charity admitted being deeply embarrassed by the disclosure of the size of the bills, and pledged that all future legal work would be put out to tender.

'It was unfortunate that details of the bills got out in the way they did,' said a spokesman. 'We know this is an important issue. We are the continuation of the Princess's work so it is important that people feel confidence in the way we operate. We must not just act properly, we must be seen to be acting properly.' The board agreed that it would also meet 'when we feel the time is right' to elect a replacement for Mr Julius as chairman.

It was unclear last night whether Mishcon would be bidding for contracts once they are put out to tender. A fund spokesman said: 'We would expect them to, certainly they are entitled to.' Mishcon partner Jonathan Cameron said: 'That decision will be taken once the tendering procedure is initiated.' The nine board members met yesterday at Mishcon's London offices to discuss the widespread condemnation of the firm's fees. …