Legal Cost Specialists

Posts made in November, 2009

Legal costs news update

By on Nov 30, 2009 | 1 comment

Post Magazine has reported that a delay to the approval of the draft rules for the new RTA claims process means that the previous April 2010 implementation date will be postponed by at least a month.  Hopefully the rules will be published long before that because I am meant to be speaking at a Central Law Training conference on this process on 12th March 2010.  It will be an interesting day if the rules aren’t out by then. More bad news on the fixed costs front comes from the Gazette that reports the failure of agreement in relation to talks aimed at fixing costs for all fast track claims.  These talks were instigated by Lord Justice Jackson as fixed fees for fast track cases are likely to form a central part of his final report.  The failure of the talks is no great surprise given the Association of Personal Injury Lawyers is so strongly opposed to an extension of fixed fees and even walked out of the talks at one stage.  As I suggested in a previous post, before they rejoined the talks: "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".  APIL will now no doubt claim that the failure of the mediation is evidence that, despite their best efforts, an extension of fixed costs is a bad...

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Jedhead v Horsehair wigs

By on Nov 26, 2009 | 2 comments

A recent article in the Evening Standard (click link) newspaper reported on the spread of the “Jedhead”.  This is the sticky-uppy hairstyle sported by Jedward, the twins from the X Factor.  The article claimed the “style crosses boundaries of age, gender, sexuality and taste”.  I have no problem accepting the first three in the list but can’t accept the last.  All those sporting the Jedhead share the same taste: bad. I have yet to see evidence that this hairstyle has infected the legal profession but a bottle of champagne to the first solicitor, barrister or costs draftsman who can produce a picture of themselves about to enter court displaying such a haircut. Horsehair wigs don’t count (unless heavily gelled and sticking...

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Market forces in setting hourly rates

By on Nov 23, 2009 | 1 comment

Lord Justice Jackson’s Preliminary Report on civil costs raises a number of concerns about whether any proper market forces operate in relation to lawyers’ hourly rates in personal injury claims:   "For the claimant personal injury market in particular, where the majority of work is conducted under conditional fee agreements, the chargeable hourly rate recoverable in costs assessments will usually provide the benchmark for the chargeable hourly rate to the client (in respect of base costs). Claimant solicitors in this sector tend to offer ‘no win no fee’ arrangements under which they seek to ensure that clients recover 100% of their damages with no deductions for costs. This necessarily has the effect of removing market forces that would otherwise apply from the sector. Solicitors’ charges are dictated by the level of costs recovered from the losing defendant rather than the lay client."   Further:   "Insurers consider that the hourly rates being paid to claimant solicitors are too high. There is a substantial discrepancy between the hourly rates of claimant solicitors and the hourly rates of defendant solicitors."   He also reported the views of the Association of Law Costs Draftsmen in relation to CFA funded claims: "There is no control over hourly rates in a situation where the clients are indifferent to the rates charged".   This is to be contrasted with a recent report in The Times:   “The ‘magic circle’ has lost some of its power: average hourly rates for London’s top commercial lawyers fell by a third last year as law firms offered substantial discounts after competition intensified in the downturn.”   This shows the impact that market forces, when available, can exert even in the field of legal costs.   It will be interesting to see what recommendations the Advisory Committee on Civil Costs makes in relation to increasing (or decreasing) the Guideline Hourly Rates in 2010.  When announcing the figures for 2009 they made clear that a more thorough review of the way rates were calculated was necessary and they hoped to have looked at these issues by 2010.  Combined with the publication of Jackson LJ’s final report, 2010 looks to be an interesting year for the legal costs...

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The legal costs song

By on Nov 18, 2009 | 0 comments

Surprisingly, legal costs is not a subject that many of the world’s great songwriters have chosen to deal with.  You can therefore imagine how exited I was to come across the following: (If you receive the Legal Costs Blog via email you made need to adjust your security settings to view the...

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Cheaper personal injury claims?

By on Nov 16, 2009 | 0 comments

Recent articles in the Law Gazette have expressed concern about the practice of “third-party capture” where insurers approach accident victims directly in an attempt to agree damages without the involvement of claimant solicitors. Claimant lawyers argue that insurers try to settle these claims below their true value and that without their involvement justice will not be done. On a related issue, I recently came across an article by David Marshall that produced a number of statistics in support of the view that an increase in the small claims track limit would be a bad thing as less people would be willing to bring claims without legal assistance. One of those statistics was from a MORI poll that produced the finding that “73% of respondents said that they would be unlikely to be able to value a personal injury claim without a solicitor”. What jumped out at me from that poll was not the fact that 73% of the public thought they would not be able to value an injury but that presumably 27% of the public thought they would. One in four members of the public think they are a walking Kemp & Kemp! Even I would have to concede there may be a certain amount of naivety here, but I may be underestimating the intellect of the great British public. Claimant solicitors naturally try to paint this as all an or nothing issue. Either a solicitor is involved in the claims process from start to finish, in which case the client can expect to receive proper compensation, or the poor client is left entirely to the merciless clutches of the evil insurer who will under-settle the claim. Third-party capture cases are, by their nature, cases where liability is not in dispute and the insurer wants to settle as cheaply as possible (at least so far as the legal costs side is concerned). Let’s assume in this situation that a medical report is obtained from an independent medical expert (at the insurer’s expense). The Claimant completes a standardised form containing information of any financial losses and produces evidence in support. Assuming the medical expert does not recommend further investigation, at that stage the insurer makes an offer in settlement....

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