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What does the Young Report mean for the legal profession, the insurance industry and the legal costs world?
Lord Young recommends the implementation of Lord Justice Jackson’s Costs Report:
“It is my firm belief that the government should adopt Lord Justice Jackson’s proposals as soon as possible”
The Government has approved the Young Report with the Prime Minister saying:
“Lord Young has come forward with a wide range of far reaching proposals which this Government fully supports”
Lord Young has also proposed the expansion of the RTA claims process into other personal injury and lower value clinical negligence claims. Separately, the Government has advised it wants to press ahead with Lord Justice Jackson’s proposals to end the recoverability of success fees and ATE insurance premiums as a matter of urgency.
It is not quite clear how extension of the RTA claims process would tie in with Jackson’s proposal to introduce fixed fees for all stages of fast-track matters. Presumably there would be a different fixed fee system for those cases which fall outside the extended claims process.
For claimant lawyers the future is clear. The end to recoverability of success fees will greatly reduce their fee income.
For defendant lawyers the future is less easy to predict. The expansion of the current claims process may reduce litigation generally and reduce work volumes.
Insurers will hope that the proposed increase in general damages will be more than off-set by the end to recoverability of success fees and ATE premiums.
And those working in the legal costs world? Well, for those dealing with party and party costs, most will lose their jobs.
How quickly? Lord Young gives a target date of April 2012 for the extension of the claims process. Allowing about a six-month run-off period for older cases (the change will not be retrospective) gives us a date about two years from today when the impact will start to seriously bite in terms of work volumes. That means a couple of years from now most of the law costs draftsmen, legal costs negotiators and costs lawyers (yes, you too) reading this will no longer be reading the Legal Costs Blog as it will be irrelevant to whatever new line of work they are then in.
I’m planning on retraining as an acrylic nail technician (trust me, that’s where the big money will be). As for the rest of you, best of luck.
Michael Cook, speaking at this years’ Association of Law Costs Draftsmen’s National Conference said he saw Jackson as a “costs lawyer’s charter” for reviving “ancient skills” such as budgeting, costs management and solicitor/own client work, with costs management being “the costs lawyer’s dream”. He concluded:
“Let’s not have any more talk about Jackson putting costs draftsmen out of business.”
I guess one of us is going to end up looking pretty silly.