The defendant costs specialists

Fixed costs extension to go ahead

By on Jan 9, 2012 | 10 comments

The missing piece of the Jackson legal costs reforms is about to be slotted into place. Jackson proposed fixed fees across the fast-track and, although other areas of his recommendations seem certain to be implemented, this was the one glaring omission from the concrete proposals.

David Cameron has now announced the firm intention of the government to extend fixed fees. The Law Society Gazettte ran with the somewhat misleading claim that “David Cameron today announced plans to cap lawyers’ fees from personal injury claims at £25,000”.

Legal Futures gives, I suspect, a rather more accurate summary:

“The government is to extend the upper limit of the road traffic accident (RTA) portal to £25,000, while similar fixed-fee schemes are to be introduced into other, as yet unspecified, areas of personal injury … All that is definite right now is the extension of the RTA portal limit from the current £10,000 and that the model will be used for other areas of personal injury work. Legal Futures understands that this is very likely to include both employer’s and public liability, but more work is still needed before deciding whether industrial disease and clinical negligence cases will be caught too. It is unknown at the moment whether the new regimes will be for cases worth up to £10,000 or £25,000.”

The current £10,000 limit for RTA claims apparently catches around 80% of such cases. Previous government predictions are that extending this to £25,000 would capture 90% of such claims. Assuming that average damages for non-RTA claims are not dissimilar to RTA claims, a similar extension into other personal injury work would have a similar impact.

My back of the envelope calculations suggest that, excluding clinical negligence, approximately 75% of claims that currently fall outside a fixed costs regime would be caught by an extension to £25,000, with a corresponding reduction in costs work.

Best estimates are that around 50% of work currently undertaken by law costs draftsman and Costs Lawyers is personal injury work. This obviously masks the fact that some are 100% reliant on this work.

    10 Comments

  1. Still recruiting? I wonder – what will future cost draftsman start learning from with no low/middle value files to work on??

    roots manoova

    9th January 2012

  2. And will there actually be no low/middle value files to work on? A fair amount of RTA Portal stuff falls out and given that there are considerably more disputes in EL/PL cases, won’t a fair amount of those cases fall out of the fixed costs regime?

    Anon

    9th January 2012

  3. Unlikely there’ll be any unlitigated matters to learn on and build understanding. Going the stage further, Jackson ultimately proposed contingency fees and one way cost shifting did he not? One wonders whether ultimately this will be the start of a MUCH larger process but either way this is pretty major, no?

    roots manoova

    9th January 2012

  4. But still surely there will be work that will fall out the Portal?

    Anon

    9th January 2012

  5. I have no doubt we will see less work because of this but I think Anon is right, its not going to take all the Fast Track away, cases are falling out of the Portal so there still will be some fast track work, any further thoughts from anyone here?

    Anonymous

    9th January 2012

  6. It is not just a case of less work it is also a case of many more costs draftsmen. Of more concern to the ordinary CL is the fact that many “qualified” solicitors and barristers cannot find a traineeship or pupilage and are turning to costs to the detriment of the said CLs.

    Simon`s recent advertisement suggests CLs could soon be regarded as Championship material rather than Premier League.

    Cockney Rebel

    10th January 2012

  7. I understand what you are saying however what I think we are trying to clarify is the fact that this is not just going to make all fast track costs work disappear. Obviously it will put some out of work solely reliable on this or certainly reduce their workloads heavily.

    Anonymous

    10th January 2012

  8. Im waiting for the flurry of c.v.’s from previously engaged Defendant cost negotiators, out of work because they have nothing to negotiate on, all claiming years of experience in costs – usually not one bill prepared

    Anonymous

    10th January 2012

  9. Bill drafting as we know it is in the process of being modernised, hence soon it will not matter how many old style bills you have drafted…

    Anomy

    10th January 2012

  10. completely disagree – a large element of the skill in drafting is knowing what not to say in a Bill

    However the Bills are revamped that will not go.

    The person who prepared quality bills old style will be the person who prepares quality bills new style

    annon

    11th January 2012

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  1. Legal aid bill ‘would reduce family clients by 75%’ | - [...] on from the news about the planned extension of fixed fees across the fast-track is the survey for Resolution…

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