Legal Cost Specialists

Posts made in September, 2009

Successful Conditional Fee Agreement challenge

By on Sep 30, 2009 | 0 comments

Most Conditional Fee Agreement (CFA) challenges follow a well-trodden path. However, occasionally a new variation arises where there is no authority directly on all fours. This happened in the recent case of Smith v Carpetright plc, heard by Regional Cost Judge Sparrow in Norwich County Court. The Claimant had entered into a CFA with Godfrey Morgan solicitors. It was a condition of the, now revoked, CFA Regulations 2000 that for a CFA to be valid the solicitor must advise the client, before the CFA is entered into, whether they recommend a particular method of funding the claim and if they recommend a particular ATE insurance policy their reasons for doing so. The CFA in question recommended an ATE policy with Amicus. Witness evidence was served during the detailed assessment proceedings that stated that this was the policy that was also orally recommended to the client. However, the CFA itself then went on discuss an Accident Line Protect insurance policy and stated that such policies are “only made available to you by Solicitors who have joined the Accident Line Protect Scheme”. Gibbs Wyatt Stone acted for the Defendant and argued that there had been a breach of the Regulations in that it was inherently confusing as to which policy was being recommended (whether an Amicus policy or an Accident Line Protect policy) and that there had been a total failure to explain why the Amicus policy was being recommended, if it was, given the only details given had related to the Accident Line Protect policy. The Judge held that there was real confusion in the written CFA as to what was being recommended and the likelihood was that anybody reading the CFA would consider that Amicus and Accident Line Protect were one and the same. Regardless of whether or not clear oral advice had been given, the Regulations required the advice concerning the ATE recommendation to be in writing and this had not been clearly done. This amounted to a breach which undermined consumer protection and was therefore a material breach. The CFA was held to be invalid and costs of over £90,000 were disallowed. The Claimant is appealing this...

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New Claims Process fixed fee agreement

By on Sep 28, 2009 | 0 comments

The Ministry of Justice has just announced that claimant and defendant representatives have “reached broad agreement on the detail” of the new Claims Process for RTA personal injury claims with a value of between £1,000 and £10,000. The Civil Justice Council has mediated an agreement on the fixed recoverable costs which will depend on which stage of the new process each case reaches. The agreed fixed costs are: £400 for Stage 1 (the claimant solicitor completes the claim notification form and sends it to the insurer who may admit/deny liability); £800 for Stage 2 (where liability is admitted, the claimant obtains a medical report and the process continues with offers and negotiation of a settlement to a strict timetable); and £250 paper hearing / £500 oral hearing for Stage 3 (where the parties cannot agree a settlement and the case goes to court). The draft rules, practice directions and pre-action protocols have yet to be drafted (and the devil will be in the detail) but the implementation date being aimed for is April 2010. Another chunk of work is likely to be lost to costs professionals as a result of these...

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Free legal advice too expensive

By on Sep 21, 2009 | 0 comments

It seems that it’s not just defendant insurance companies that are unhappy about the legal costs that some lawyers charge, as this video shows: (If you receive the Legal Costs Blog via email you made need to adjust your security settings to view the...

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Jackson Costs Review facing first hurdle

By on Sep 15, 2009 | 0 comments

The Gazette (click link) reports that the Association of Personal Injury Lawyers (APIL) has walked out of talks on extending fixed costs in personal injury cases. This mediation was put together at the request of Lord Justice Jackson as part of his Costs Review. It seems inevitable that his final report will include a recommendation that fixed fees are introduced for all stages of the fast-track in personal injury claims and this mediation was intended to lead to an agreement as to the appropriate figures. It is somewhat hard to interpret this new development. It may simply be initial posturing on the part of APIL. It is no secret that APIL opposes the extension of fixed fees; they said as much in their response to the Jackson Preliminary Report. If they simply wished to scupper the mediation, it would have made more sense to continue to play along and undermine the process from within. Without APIL’s involvement what will happen? It seems very unlikely that Jackson LJ will abandon this central part of his reform program simply because one interest group does not want to cooperate. On the other hand, will any figures now produced lack credibility? APIL runs the risk that the process will move forward regardless but they will lose the opportunity to influence the final figures. Watch this...

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Impressive CFA success rate?

By on Sep 12, 2009 | 0 comments

The Claims for you (a trading name of Wixted & Co solicitors) website claims that they succeed in 98% of their accident claims. If true, this is an impressive success rate. However it does raise a number of issues: 1.  Is this success rate not a reflection of the quality of the lawyers who work for this firm but rather a reflection of how risk adverse they are? Do they only take on cases they consider to be dead certs and wouldn’t touch with a ten-foot barge pole anything that looks as if it has the slightest chance of failure? 2.  If this level of success is even remotely typical of personal injury firms, where on earth did the fixed success fee figures come from? The ready-reckoner produces a success fee of 2% where the prospects of success are 98%, but the fixed success fee for even straightforward RTAs that settle pre-trial is 12.5%. 3.  For non-fixed success fee claims, what level of success fee does this firm claim? What do they argue on detailed assessment to support their success fees? Do they claim an average success fee of 2% to reflect their success rate? If any readers of the Legal Costs Blog have any recent experience, let us...

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