The world of personal injury claims and clinical negligence claims is fast changing. Recent legislation and further proposed changes by the new coalition government are going to seriously impact on injury & accident claims.
The essential changes of interest to injury clients are as follows:
- Success fees to cease to be recoverable from losing Defendants. This means up to 25% of clients’ compensation will be deducted upon successful conclusion of the claim, this radically alters the whole concept of “no win no fee”. The idea is to involve clients more closely, by taking away the concept of a completely free service and involving them financially in the outcome of their claims. To offset this, the government proposes increasing compensation for injuries by 10%.
- Insurance premiums also to cease to be recoverable. However, the government proposes “one way costs shifting”. This will mean that a successful claimant will still recover costs as now (subject to the above), but a losing Claimant will not be required to pay costs to a winning Defendant, unless they have behaved unreasonably in some way ( still largely undefined). This costs shifting will make insurance policies unnecessary in most cases.
- Tighter controls over referral companies. This is a good thing, there are too many rogues and charlatans out there whose interest is only in their profits, not in clients’ welfare.
- All low value claims (i.e. under £10,000) to be subject to predictive costs and go through the new government’s portal, which is supposed to speed matters up. It probably will, but with fixed predictive costs very low, it may well impact upon the quality of service solicitors are able to provide in such cases. At the moment, only RTA claims under £10,000 go through the portal.
- Road accident claims up to £25,000 to go through the portal subject to predictive fixed costs.
- Medical negligence cases under £10,000 eventually to come under the same regime.
- The ending of legal aid for medical negligence claims.
- The introduction of USA style contingency fees, whereby a winning client pays his lawyer a percentage (and nothing if he loses). The percentage is likely to be about a third. This may be of interest in the larger cases.
- As for when these seismic changes will come in, this is not yet known with any certainty. The ending of legal aid for medical negligence claims and the ending of recoverable success fees may well be as early as April 2011. The planned changes to low value claims may be April 2012.
Relervant documents to download and view.
The Legal Services Act 2007 – briefing
Legal Services Bill Full Regulatory Impact Assessment
Legal Services Bill Supplement to Regulatory Impact Assessment
Proposals for the Reform of Legal Aid Download
Legal Aid Reform: Scope Changes
Legal Aid Reform: Provision of Telephone Advice
Proposals for Reform of Civil Litigation Funding and Costs in England and Wales Download
If you have any comments on these changes, please do use our blog.
