So when is a consultation not a consultation? When it is a pre-consultation - an unusual beast rarely seen in the world of legal reform. It gives a flavour of what is to come but with no detail. The Department of Health proposals seek to strip costs from the budget of the cash strapped NHS, but will also benefit other wrongdoers who negligently injure people during medical treatment – private hospitals and cosmetic surgery clinics to name but a few. Is this right? During our quarterly webinar, attracting over 700 claimant lawyers, we took soundings from our members as to the winding road the department of health is navigating.The split was 50 / 50 as to whether the reforms should solely apply to the NHS, or to all defendants.
So the million dollar question - do claimant lawyers think there is a place for fixed costs in clinical negligence cases? The response is relatively black and white. In the multi-track, a resounding 74% gave a firm ‘No’, and only 1% said ‘yes’.
In the fast track, 39% of you had some appetite, while others reserved their judgment, no doubt because the devil could be in the detail.
But maybe it’s not about legal process, tracks and arbitrary cost limits. Maybe there is more to it than that. We asked whether costs should be fixed by virtue of value, complexity, or the type of injury. Only 17% of you opted for value as the sole definer. 41% of lawyers surveyed indicated that any scheme needs to properly take account of complexity, perhaps through exemptions for certain types of cases, or only setting costs in cases of low complexity. Injury type is also very important – with 31% of lawyers surveyed thinking that the rules should reflect this, only applying to injuries from which the client will make a recovery, rather than life changing injuries.
The proposed capping of expert fees seems biased - 99% of APIL members that responded thought that if they are to be capped, then expert fees should be capped for both claimants and defendants to create a level playing field, rather than just the claimant’s purse strings being firmly tied. And how will capping work? Would the rules set the fee the expert can charge, or the amount that the claimant lawyer can recover? If it is the latter, experts will still charge the same rates and the balance of the fee will then be charged to the client. When surveyed, 81% of APIL members said they would have to consider charging the balance to the client, reducing net damages further. Watch out for that in the impact assessment.
Preparing a law firm for the forthcoming changes required by legal reform is a challenge, particularly if changes involve staff restructuring, or changes to established income streams which will impact on budget. Current proposals are to give law firms 6 months’ notice of impending changes. 85% of you said resolutely that was not enough time.But obviously, the impact of a start date depends on the trigger point. Traditionally, to avoid retrospective application of legislation, the date of incident is used. 50% of claimant lawyers surveyed supported this approach. This has the advantage of a trickle effect of change, as new cases come along, which can be easier for firms to manage. However, the Department of Health is seeking to speed up the rate of change and accelerate potential cost savings, by looking at the letter of claim as the trigger. 77% of members surveyed saw problems with that proposal. This is a complex area requiring more thought. Importantly, it is about making sure that clients can be properly advised as to cost liabilities at the start of their case.
So, its early days but there is scope for the government to do something measured and sensible with these reforms - to sit around the table with interested parties and build something that will work for the injured person, the claimant lawyer and the defendant. To do this, they will need to reflect on the responses and consider reducing the proposed limit of £250k to £25k as a starting point. Failing that, there is scope for fixed costs to be imposed that are too far reaching, too cheap, that will cut expertise out of the process, impacting negatively on the injured person’s ability to seek justice.