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What ‘s happening to our access to justice?
Many readers will have, understandably, completely missed the sea-change in the court landscape over the past few months.
No win No Fee arrangements or Conditional Fee Agreements were first introduced in England and Wales for a range of court cases in 1995, ultimately replacing jaded ‘Legal Aid.’
At the time Geoff Hoon said:
“No-win no-fee conditional agreements will result in better access to justice. Access will be given to the many people who fall between those who are very rich or those who are so poor that they qualify for legal aid. In future, the question of whether one gets one’s case to court will no longer depend on whether one can afford it, but whether one’s case is a strong one.”
In recent times, the media has, however, concentrated on the so called “compensation culture”, focusing on fraudulent claims, the damages awarded for what may seem the most trivial of injuries, and not reporting on the very many people who have received damages for injuries that they otherwise would not have been compensated for.
However, in January 2010 Lord Justice Jackson published the ‘Review of Civil Litigation Costs: final Report’ recommending an update on the recovery and payment of costs. This wide ranging report has formed the basis for an item of legislation which has been titled the Legal Aid, Sentencing and Punishment of Offenders Act (LASPO) 2012. This massive altering of the legal landscape is timed to come into force on April fool’s day.
But how will this legal reform affect you?
Basically it will change how solicitors can charge clients and recover costs from defendants for many types of claim, which includes all personal injury claims from slips, trips, accidents at work and on the road.
Solicitors will no longer be paid by the defendant the full costs of representing their clients. The government has decided that injured parties should share the costs of bringing their claims, and has increased the damages which will be awarded to the injured party by 10% to offset the amount they will have to pay their lawyers to represent them. In the same step, they have removed the ban on solicitors taking a cut of their client’s damages.
“You WONT keep 100% of your compensation”
This spells the end of solicitors being able to represent you and not take costs from your damages. The only way you will get to keep all your damages is if you take the offer made by the other side, and what is the more likely outcome there ? Do you think that the insurance company will want to look after your interests, or those of their shareholders ?
“100% of what they think it’s worth, or 80% of what its actually worth?”
The days of free personal injury claims are sadly coming to an end. A year from now, you will bring a claim for damages, and it will be expected that you will only see a part of it, with the lawyer keeping a percentage to cover his costs. Whilst this sounds like it would be better to simply take the offer from the guilty party’s insurer, how do you know it’s the right amount ? If you employ a lawyer, then you will end up paying a part of your damages to them, but at least you will have the comfort of knowing that you have had someone on your side, ready to argue for the right compensation. You may decide that as you have received a larger amount, then it will be ok to share some of it for that service.
Access to Justice ?
There’s also likely to be a significant impact on the ability of individuals or companies without legal representation to pursue claims against large insurance companies or corporations on an ‘equal footing’.
Once LASPO starts, online sites will flourish, inviting people to pursue certain types of cases up to a value of £25,000. Clients, especially the poor and elderly, are unlikely to benefit from their opponents’ resources, such as databases and internet access, in order to comply with legal protocols and gain knowledge of issues that would normally be handled by their solicitor.
As a result, many people will be unable to fund their cases, while the potential for gross under-settlement (as exists under 3rd-party capture, where insurance companies make pre-solicitor involvement offers) will probably increase.
We could also see a rise in professional negligence claims against solicitors if people feel they’ve been the victim of under-settlement of their claims to reduce the solicitors’ legal costs. This will be something to watch for.
The Law Society’s Chief Executive, Des Hudson, said, “It is ordinary families with terrible life challenges that will be impacted the most. They will be the losers. As a society we need to protect them.”
Solicitors will no longer be able to recover the cost of litigation insurance, commonly referred to as ATE from the debtor. This means that people who have suffered an injury
Any good news?
The new regulations do not come into force until 1 April 2013.
If a claim is brought before then, then it can be brought on a conditional fee agreement which means no deduction from damages. If readers move NOW then they can still get the compensation that they deserve, without having to pay. If they wait, then it will cost them !
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