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Tuesday, 25 August 2015

The Day the QOCS stopped

The 1st April 2013 is a date which is ingrained in the memories of most litigation lawyers, especially those of us who act for victims of accidents, industrial diseases or medical negligence. It was the day that changed the world.

Almost all of these cases are dealt with on a no win no fee basis, so the claimant’s lawyers do not get paid if they do not win. Following implementation of the Jackson Report it was no longer possible to recover insurance premiums or success fees from defendants in successful cases, apart from a very limited exception in medical negligence cases. Recovery of these additional liabilities had been the foundation stone of the steps taken by the Labour Government in 2001 to remove Legal Aid for Personal injury work.

To mitigate the effect of this, the government introduced Qualified One Way Costs Shifting (QOCS). This meant that, in most cases, if a claimant lost a case they would not have to pay the other side’s legal costs. This in turn meant that there was no longer any need to take out insurance to cover those costs. So a claimant of limited means could pursue a claim with the comfort of knowing that they would not face a huge legal bill at the end if they failed.

The protection can be lost if there is evidence of fundamental dishonesty. It can also be lost in cases in relation to offers to settle under Part 36. I don’t propose to go into those detailed rules today. Kerry Underwood has written an excellent summary here –

The theory behind all this is to enable claimants to seek justice and sleep at night.

Sadly the theory and the reality are different. A claimant can be ordered to pay all of the other side’s costs if a claim is struck out because it shows no reasonable grounds for bringing the claim.

This is demonstrated by the tragic case of Wall v British Canoe Union. Mr. Wall was killed in a canoeing accident in January 2012. He was 49 years old. To make matters worse the accident was witnessed by his 16 year old daughter. The action was brought against the defendants as publishers of English White Water – The BCU Guidebook. The allegations were that the publication failed to give adequate warnings of the dangers at the particular waterway at which Mr Wall had his accident. Earlier this year Judge Lopez in the Birmingham County Court struck out the claim on the grounds that Mrs Wall had no reasonable grounds to pursue the claim. . It was found that the publishers owed no duty of care to readers of their guide. There was an insufficient relationship of proximity. The judgment is an interesting summary of the law of negligence and Gordon Exall has published a summary here –

So the unfortunate Mrs Wall, having lost her husband, also lost her claim. But the tragedy does not end there. She was also ordered to pay all of the Defendants’ legal costs. This is because the judge decided that she had no reasonable grounds to bring the claim. So she could now lose everything.

When I first read the judgment, I just thought that she must have been badly advised to have brought this case in the first place. But on reflection the judgment is disturbing. Here is an honest victim who has lost her husband and whose children have lost a father. The whole idea of QOCS is to enable such victims to bring their claims without the fear of costs and without the need for insurance. It was certainly not a spurious claim. The judgment runs to 38 pages. There were real arguments about the extent of a duty of care to readers of the guide.

Was it really the intention of the rules on QOCS, to deter victims from bringing such claims for fear of losing their homes? Where does this leave the development of the common law? Imagine where we would be if Mrs Donohue had been too scared to sue Mr Stevenson. Our legal system, which has been copied across the world, has been build on the basis of groundbreaking cases that have pushed the boundaries.

This is likely to grind to a halt following decisions like this.

That is not to criticise the judge who acknowledges that he is required to apply the law.

What we need is a revision of these rules on QOCS which were hastily introduced and help nobody.

Tuesday, 11 August 2015

Concerning fixed fees and more attacks on vicitms of medical blunders

The government is now consulting on the introduction of fixed recoverable fees in all Clinical Negligence cases with a value up to £250k. That will catch some very substantial cases involving severe disability.

It is no surprise that the move is justified on the basis of criticism of those law firms who represent victims. In a report mentioned by Litigation Futures the Department of Health says –

“in the experience of the [NHSLA], significant costs are often incurred by claimant lawyers in the pre-litigation and pre-notification period and are not subject to costs budgeting requirements. There is also evidence of claimant solicitors attempting to claim costs well in excess of the current guideline hourly rates, and considerably higher than the NHSLA pays its defence solicitors.”

I have mentioned before that it is inappropriate for the organization which represents the NHS to try and control the level of legal costs which they have to pay. They are clearly conflicted. Remember they are only paying anything in cases where liability is proven or admitted. A case involving awards up to £250k means life changing injuries.

Now I need to say that I am not particularly worried by the likelihood of fixed fees in straightforward cases.  I have long suspected that they were inevitable especially as costs budgeting seems to have been a shambolic and expensive experiment. Fixed fees are now widely used in commercial litigation and transactions. Payment by the hour is perceived as a reward for dragging cases out, particularly those which are not complex. But many cases up to £250k will be very complex.

What is clear, is that this is an attempt to reduce the number of genuine claims and the amounts payable to victims. If the NHS does not have to pay full legal costs in those cases where they are clearly at fault, it is the victims who will have to pick up any shortfall.

The NHSLA need to review their own conduct. I have started court proceedings in two cases, in  the last month, where the NHS failed to respond to a letter of claim within the four months set out in the pre action protocol. In both cases they have subsequently admitted liability. The legal costs are now much higher then they would have been. Why is that the victim’s fault?

It is also reported today that the NHSLA routinely fail to make interim payments to victims –

Many cases are aggressively contested and then settled late in the day for modest damages and huge legal costs. If these cases were resolved at an early stage there would be massive savings.

We have seen a developing pattern over the last few years where victims, and their representatives, are attacked as a prelude to the introduction of measures designed to shrink access to justice. I suspect that some form of fixed fees is inevitable across all civil litigation. But this has to be based on sensible and commercial discussions and not inflammatory rhetoric.