This article was contributed by David at CK Claims – a personal injury solicitor based in Manchester, UK
Justice Secretary Kenneth Clarke’s plans to reform the ‘no win, no fee’ legal scheme, due to fears of Britain’s growing compensation culture, will have a huge impact on the justice system.
Ostensibly, the changes are designed to reduce costs to the taxpayer and encourage lawyers to avoid frivolous cases. But for ordinary people seeking justice – particularly against large organisations like healthcare providers or newspapers – this is a worrying proposition.
The ‘no win, no fee’ system currently works by permitting claimants to embark on a quest for damages which, if successful, sees all legal costs covered by the other party. Since claimants do not pay anything in the event that their case is unsuccessful, the lawyer takes the risk that they may not get paid unless they can win the case.
Under Clarke’s reforms, lawyers would take a contribution of around 25% of the victim’s compensation. Even in the event that a claimant was successful, he or she would still have to pay legal costs from what often turns out to be very modest compensation. For many, this would make pursuing a claim financially impractical from the outset, punishing genuine victims of injustice.
The most upsetting part of Clarke’s proposed reforms is that it is the victims of more difficult cases that will suffer the most. Without capped legal costs, victims of clinical negligence, workplace accidents or illness are vulnerable to spiralling legal fees.
Considering that such high profile cases as that of the Dowler and McCann families were run on ‘no win, no fee’ agreements, it is easy to see how vital this process is for those of average means. Without the opportunity to enlist the help of a ‘no win, no fee’ solicitor, many will simply not be able to take their case to court.
Furthermore, despite Clarke’s protests that these measures will help to protect the taxpayer, it is largely thought that implementing these changes will actually cost the public more in the long term, as the cost of insurance premiums will increase.
Some critics have described Clarke’s proposed reforms as misguided, whilst others have questioned his ethical integrity. What seems clear is that, rather than simply penalising those who seek to exploit ‘compensation culture’, the proposals will reduce access to justice for ordinary people of modest means.
In the U.S., fees and costs are negotiable. Of course, everything hinges on the strength of the case.
I haVe mixed feelings about this issue.
1. People of limited means have an opportunity to pursue a claim which would be impossible without the scheme.
2. It may persuade some organisations to be ‘honest’, knowing that ordinary folk are not so helpless as they may wish.
BUT
3. We get frequent phone calls along the lines of “We understand you have had an accident and could be entitled to compensation.” This is despite the fact that we have had no accident and are registered on the Telephone Preference scheme.
We ask who is calling and the phone goes dead!
4. Hearsay is that the firms offering this service only take on pretty sure cases.
Overall, I think the scheme does offer a useful service to some folk and to provide a safety net for people of limited means.
Pat, you’re right, there are far too many cowboys operating in the personal injury field – the answer to that is better regulation though, not scrapping conditional fee agreements. Justice shouldn’t just be available to those who can afford to pay for it.
What happens to the poor then? If you have money then there is no alarming matter but if you already are in a financial bind it might sway you to not even take action. I think it needs revision.