... has mixed views Ken Clarke's proposed legal costs changes

As I said in my previous post, I'll now deal with Part 2 of the government's new "Legal Aid, Sentencing and Punishment of Offenders Bill"

Damages-Based Agreements

One thing the government plans to expand upon are what's known as "Damages-Based Agreements" (DBAs) (s. 42) which already occur in employment law cases.

The basic idea is that a solicitor will take a percentage of any damages received as his success fee (the bonus for winning a case on a "No-Win, No-Fee" basis), instead of the current system whereby a success fee is claimed from the losing party.

I'm not sure that this is a good thing as it could cause cases to drag on in the hope that a bit more damages will be obtained, while racking-up unnecessary legal costs.

I'm also a bit concerned about whether there will be any technical legal arguments over these things. The "No-Win, No-Fee" cases used to have to comply with the CFA Regulations 2000. These were scrapped a few years ago due them simply causing a lot of wasteful litigation over whether the solicitors argeements with thier clients complied with them. Talk to any solicitor about the CFA Regulations and you'll hear nothing but horror stories. I went a to a talk about DBAs a few weeks ago and the speaker mentioned that there had been suggestions that the only way DBAs could would would be by bringing back in equivalent to the CFA Regulations. I shudder at the thought.

ATE Premiums

The government also plans to stop ATE Insurance premiums - insurance taken out to cover legal costs which a party may face - from being claimed from the other side. (s. 43). I've no real views on this, one way or the other. It would make my work slightly easier as there are numerous disputes over whether they premium should be paid, and to what extent. Of course, I'm not sure whether simplifying my job is a reason to support this proposal.

Divorce proceedings


There are plans to alter the way divorce cases are dealt with (s. 45-50). To be honest, I've never had to deal with these sort of cases, so can't comment on whether the plans are a good or bad idea.

Claimant's settlement offers

Section 51 is interesting - they plan to bring in extra damages if a Claimant beats their own offer to settle the claim at trial, e.g. if the Claimant offers £5,000, which is rejected, and the Judge allows £6,000 then it will come into play.

However, it doesn't say how much extra would be awarded nor how it would be calculated, e.g. would it be based on the total awarded?; the percentage that is on top of the offer?; etc.

It also doesn't say that there will be any extra award for the Defendant who beats their own offer at trial, e.g. if the Defendant offers £6,000, which is rejected, and the Judge allows £5,000.

I agree with allowing extra damages as it would encourage the Defendants to make more realistic offers, as not only could they be liable for penalty costs ("Indemnity Basis" costs) as now, but they would have to pay out more.

Nothing else is of particular interest from a legal costs perspective. Tweet