LML News & Events

Updates and events about our group action cases, plus general news about group litigation in the UK and related subjects.

17

Feb

Jackson Reaction

Last week, on 28th January 2016, Sir Rupert Jackson made a key note speech to the Insolvency Practitioners Association where he called again for fixed recoverable costs to be introduced across all civil litigation. The intent is to move the UK system closer to that in Germany, for example, where legal costs are predictable and recovered on a tariff basis. It is well rumoured that he has strong support from the Ministry of Justice for this, so it is being seen as an inevitable direction of travel.

This is a massive change, which could well impact on the profitability of claimant litigation practices. It is a predictably emotive subject and the debate will rage under the heading of “access to justice” with some arguing that fixed costs will enhance access to justice because they are predictable, insurable and affordable while opponents say that access to justice won’t be enhanced because fixed fees will be set below the true cost of some cases. This, they say, will force good lawyers to turn good cases away because they know they will be unprofitable and bad lawyers to accept them only by running them on a shoestring with the risk that they lose.

Both of these arguments could be right. We just don’t know yet. The answer will depend on the actual level of fixed costs imposed. Jackson LJ has proposed a grid of costs to start the debate, but there is time for it to be changed.

And the only way that claimant lawyers can contribute to the outcome is to get involved. Previous experience of “big tent” and Civil Justice Council meetings in the wake of the Access to Justice Act 1999 and ahead of LASPO 2012 suggests that that the debate will be full of emotive anecdote and rhetoric, but insufficient data. Rumours from the Ministry of Justice suggest that one of the reasons the Government has not bent to the weight of the claimant lobby is that its inability to produce statistics that show actual costs fuels the suspicion that it is protecting its historic ability to cream off “fat cat” profits from the current regime. Defendant insurers, on the other hand, have been able to provide thorough statistics and are taken more seriously as a result.

At LML, we know that there are enlightened firms that can use their practice management systems to evaluate the cost benefit of instructing expert managers like us. This keeps the cost of litigation effective and may become an essential tool enabling firms to litigate cases profitably within the fixed costs.

But you’ll never know unless you do the sums, and we would encourage claimant firms to start doing that now and use their data to ensure the the fixed rates are fair.

 
 
 
 
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