Legal Cost Specialists

Posts made in June, 2011

Qualified one-way costs shifting

By on Jun 13, 2011 | 4 comments

The inconsistent arguments being put forward by the anti-Jackson lobby continue unabated. Access to Justice Group co-ordinator Andrew Dismore was recently reported as saying: “The government must think again and not give in to the special pleading of the fat cat multinational insurance companies, who are the sole beneficiaries of their plans. They will save millions of pounds at the expense of ordinary people who have been hurt on the roads or at work. The government’s plans are Draconian and will end access to justice for the less well off.” Colum Smith, the solicitor who acted for the claimant in the recent high-profile £6m damages claim for plastic surgery injuries, was quoted in the New Law Journal as saying his firm would not have been able to act if success fees were no longer recoverable and limited to 25% of damages: “If we lost the case, we would have lost too much money. I make a living doing high risk cases. I don’t cherry pick.” The line of reasoning being taken here is that without recoverable success fees solicitors will be unwilling to take on more risky claims. A crucial part of the Jackson package is the proposal to introduce qualified one-way costs shifting (QOCS). Generally, successful defendants would no longer be able to recover their costs from the unsuccessful claimant. So what does David Hartley, Director of ATE services at Abbey Legal Protection, predict QOCS will mean? He was quoted in Costs Lawyer magazine as saying QOCS would lead to “a massive market in speculative and fraudulent claims”. If these twin predictions are correct, post-Jackson we can expect claimant solicitors to be less willing to run genuine cases, because of the risk of losing, but more willing to take on speculative and fraudulent claims, regardless of the risk of losing. Or perhaps not. Which is it to be? More or less...

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Hourly rate or success fee?

By on Jun 10, 2011 | 7 comments

When considering the issue of what hourly rates to allow, in the preliminary issues judgment in Motto & Ors v Trafigura Ltd & Anor [2011] EWHC 90201 (Costs) (15 February 2011), amongst the relevant factors identified by Master Hurst was: “I have no doubt in this case that Mr Day has taken responsibility for this litigation at great personal financial risk to himself, and financial risk to his firm generally.” I don’t understand this. The ‘financial risk’ was the risk that the claims would fail and, as they were being run on a ‘no win, no fee’ basis, no costs would be recovered. However, that is what the success fee is designed to cover and was considered elsewhere in the judgment. To factor this in when considering what hourly rates to allow appears to be a case of...

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Surplus to requirements?

By on Jun 6, 2011 | 4 comments

Lord Justice Jackson’s most recent observations include: “Even if no success fees were payable (and I am not advocating this), solicitors would still do much PI work. There would simply be less surplus to share out amongst claims management companies, ATE insurers, trade unions etc.” I hope he wasn’t including law costs draftsmen and costs lawyers in the “etc”....

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No win, no fee, no risk

By on Jun 2, 2011 | 3 comments

Three cheers for the Access to Justice Action Group (AJAG) and the Association of Personal Injury Lawyers (APIL). Words you probably didn’t expect to hear on the Legal Costs Blog. They have been loudly trumpeting their “independent research” into the impact of the Government’s proposals for ‘no win, no fee’ agreements. Press releases, tweets, etc. They have been strangely quiet about one element of the research findings. Of those members of the public interviewed who had brought a claim under a ‘no win, no fee’ agreement, only 2% lost their case after court proceedings had been issued. A further 3% had been dropped on the solicitors’ advice. Of those cases where proceedings were issued, over 90% of claims were successful. And we are seriously expected to believe that with these kind of success rates solicitors will not be willing to run these claims regardless of any changes to the ‘no win, no fee’ system. I’ll be waving this research around at the next detailed assessment I attend with a success fee claimed. More research like this...

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