Referral fees to get the boot

[Amethyst]

Lord Justice Jackson has called for an end to referral fees in his review of civil litigation costs.


In his report, Lord Justice Jackson said: "It is a regrettably common feature of civil litigation, in particular personal injuries litigation, that solicitors pay referral fees to claims management companies, before-the-event (BTE) insurers and other organisations to “buy” cases. Referral fees add to the costs of litigation, without adding any real value to it. I recommend that lawyers should not be permitted to pay referral fees in respect of personal injury cases."


If the recommendation is accepted, Jackson said it could be implemented in one of two ways. “There could be primary legislation, which would prohibit anyone from buying or selling personal injury claims. Alternatively, the Solicitors’ Code of Conduct could be amended, so that solicitors are prohibited from paying referral fees. In the latter event, the codes of conduct binding upon other legal representatives would have to be similarly amended.”






Justice Secretary Jack Straw has thanked Sir Rupert Jackson for his comprehensive report on costs in civil litigation.
Jack Straw said:
‘I would like to thank Sir Rupert for undertaking this review of costs in the civil courts and for producing such a substantial, comprehensive and detailed report. It is a remarkable piece of work which is based on extensive consultation and puts forward a broad range of significant recommendations for reform. I look forward to considering these proposals in detail.’
The Ministry of Justice will look at Sir Rupert’s package of recommendations in depth and will set out the way forward in due course.








02/10

JACKSON REVIEW CALLS FOR A PACKAGE OF REFORMS TO REIN IN THE COSTS OF CIVIL JUSTICE

Lord Justice (Rupert) Jackson today published the final report to the Master of the Rolls, Lord Neuberger, on his year-long, comprehensive review of civil litigation costs. His proposals include a wide-ranging package of reforms designed to bring costs under control and make them fairer.
The Jackson review was set up in late 2008 by the then Master of the Rolls, Lord Clarke of Stone-cum-Ebony, because the senior judiciary were - and are - concerned about the escalating costs of civil justice. Those costs are often disproportionate to the issues, in particular the sums at stake.
The report - the first ever fundamental review, specifically focused upon civil costs - sets out a coherent package of interlocking reforms, which are designed to reduce litigation costs and to promote access to justice.
In the course of his review Sir Rupert consulted extensively. His final report takes into account the wide range of views expressed during his two consultation periods (January-February and May-July 2009).
In addition to making for a more effective legal and court system (controlling excesses of litigation and fees), the report’s recommendations have the potential – if implemented in full – to yield substantial savings in legal costs for the taxpayer.

• For example, the heavy costs burden on the NHS (currently over £140 million per year) will be reduced (Chpt 23).
• The cost of libel litigation would also be substantially reduced (Chpt 32).
• Sir Rupert’s recommendations would also reduce the incomes of claims management companies and other intermediaries who profit from the current arrangements.

However, his recommendations are designed to ensure that overall members of the general public seeking justice do not lose out financially. The majority of personal injury claimants will end up with more compensation under Sir Rupert’s proposals.
The final report covers 45 subject areas and runs to 557 pages, with recommendations across the whole spectrum of civil litigation.
Sir Rupert’s key findings and recommendations include:

• Proportionality – the costs system should be based on legal expenses that reflect the nature/complexity of the case (Chpt 3);
• Success fees and after the event insurance premiums to be irrecoverable in no win, no fee cases (CFAs – Conditional Fee Agreements), as these are the greatest contributors to disproportionate costs (Chpts 9 &10);
• To offset the effects of this for claimants, general damages awards for personal injuries and other civil wrongs should be increased by 10% (Chpt 10);
• Referral fees should be scrapped - these are fees paid by lawyers to organisations that ‘sell’ damages claims but offer no real value to the process (Chpt 20);
• Qualified ‘one way costs shifting’ – claimants will only make a small contribution defendant costs if a claim is unsuccessful (as long as they have behaved reasonably), removing the need for after the event insurance (Chpts 9 & 19);
• Fixed costs to be set for ‘fast track’ cases (those with a claim up to £25,000) to provide certainty of legal costs (Chpt 16);
• Establishing a Costs Council to review fixed costs and lawyers’ hourly rates annually, to ensure that they are fair to both lawyers and clients (Chpt 6);
• Allowing lawyers to enter into Contingency Fee Agreements, where lawyers are only paid if a claim is successful, normally receiving a percentage of actual damages won (Chpt 12); and
• Promotion of ‘before the event’ legal insurance, encouraging people to take out legal expenses insurance e.g. as part of household insurance (Chpt 8).

The reforms provide a framework whereby parties could enter into litigation with greater certainty about the costs involved.
They would also assist in allowing for some claims to be resolved earlier with greater use of mediation.
The Lord Chief Justice, Lord Judge, welcomed the report: “The judiciary has been concerned for some time that the costs of civil litigation are disproportionate and excessive.
"Lord Justice Jackson’s fundamental review addresses these questions head on. I am extremely grateful to him for the enormous work and effort that he has brought to bear on this important, complex issue and for proposals which for the first time address the issue of costs as a comprehensive, coherent whole.
"I look forward to the senior judiciary working with the Ministry of Justice to implement Sir Rupert’s coherent package of interlocking reforms, designed to reduce litigation costs and enhance access to justice in the courts.”
The Master of the Rolls, Lord Neuberger, also welcomed Sir Rupert’s report: “Lord Justice Jackson’s report on civil costs is a magnificent achievement. Everyone, not just judges and lawyers, have every reason to be grateful to him and his team. I would like to thank Rupert and his team publicly today for a report on an important topic which urgently needs reform.
"The report is clear and comprehensive in its coverage, thorough and fair in its discussions, and imaginative and realistic in its proposals.
"The measures the report proposes will ensure that legal costs are reduced, and that civil justice will be more efficient and fairer. All interested parties have been fully consulted and their views have been reported and considered.
"The time for discussion and debate is over: it is now time for action. I hope that the Ministry of Justice will give these proposals the same enthusiastic and practical support which the Judges will give them.
"I am happy to say that Lord Justice Jackson has agreed to play a leading part in bringing his excellent proposals into effect, and I will ensure that he receives all the support that I can muster.”
Lord Justice Jackson paid tribute to the assessors and staff who have assisted him in his year-long review, and the large body of judges, lawyers and other professionals and court users who have contributed their evidence, experience and views to the review process.
He emphasised that the report’s conclusions and recommendations were his own.
Notes for Editors

• Sir Rupert started his review in January 2009.
• His full report can be accessed on the judicial website http://www.judiciary.gov.uk/about_ju...ew/reports.htm.
• Sir Rupert’s preliminary report, which contains details of his review of evidence and explanatory background material for the final report, can be accessed on the judicial websitehttp://www.judiciary.gov.uk/about_judiciary/cost-review/reports.htm.
• Copies of both reports may be purchased from The Stationery Office (TSO) by following the information on this link - http://www.judiciary.gov.uk/about_ju...ew/reports.htm.
• Please note that this news release only contains details on a few of the major proposals – the full final report should be studied to see the full effect of the recommendations and proposed reforms.

Dont get too excited about reading it unless you have £140 to chuck at it !

[charitynjw]

New Civil Litigation costs

Lord Justice Jackson’s Final Report is Published

Lord Justice Jackson today released his Final Report, recommending changes to the civil litigation system in England and Wales to promote access to justice at proportionate cost. The report follows his Preliminary Report of May 2009, and an extensive consultation on how civil litigation can be made more cost effective.
Some of the important recommendations made in the Final Report include:

• Ending the current regime of “no win / no fee” agreements, by making success fees and ATE insurance premiums irrecoverable from unsuccessful defendants.
• Allowing lawyers to act on a contingency fee basis, which usually means that if a claim succeeds the lawyer is paid a percentage of the judgment sum, or if the claim fails the lawyer is paid little or nothing at all. Contingency fees are used widely in North America, and Lord Justice Jackson sees no objection in principle to them being used in England and Wales.
• Keeping the ten pre-action protocols that apply to specific types of litigation, but repealing the general protocol. On the whole, the pre-action protocols are regarded as a useful way of assisting parties to resolve their disputes without having to go to trial, and thereby avoiding unnecessary costs.
• Encouraging judges, in appropriate cases, to take a more “hands on” approach to case management and keeping costs under control. The use of cost budgets is seen as one possible way of tackling this issue.