The Government's current proposal is that fixed legal costs be recovered by the Claimant's solicitor – i.e. the person bringing the claim, irrespective of settlement value, dependent instead on the point at which the claim settled, with further reductions for early admissions of liability.
Total costs of £3,000 for cases that settle before proceedings are issued, rising to £3,900 for settlement prior to allocation of a court date, £5,650 pre-listing and £7,150 post listing but pre-trial are simply not going to be economically viable in most cases. Lawyers will simply not be able to afford to take on the case.
My issue with the idea of fixed costs is that it mistakenly assumes that a) low value claims are less important to the injured party and b) that low value claims are easier and therefore cheaper to investigate. Anyone that has worked in the area of clinical negligence, be it for the Claimant or Defendant, knows that both these assumptions are completely false.
Low value does not mean unimportant or simple. How can we attempt to justify that it is appropriate to spend thousands of pounds investigating a claim where a baby is born with catastrophic brain injury but survives, often in spite of the treatment received, yet in another case with exactly the same substandard treatment a baby dies at birth. It would be inappropriate to investigate these two cases in the same way, because the child living with a disability has needs for life.
When the NHS Litigation Authority has recently changed its name (likely at considerable cost) to NHS Resolution, with a new motto "Advise, Resolve, Learn", it's ironic that vast numbers of Claimants will be unable to bring clinical negligence cases under the proposed fixed costs regime.
As AvMA commented: "Some of the most vulnerable people harmed by clinical negligence would not be able to achieve justice, because they would not be able to find solicitors to represent them." In addition "Even if they did, they would lose a significant amount of their damages in legal costs that would be left to them to pay."
Colin Campbell, formerly Master Campbell of the Supreme Courts Costs Office, commented on the Department of Health's plans. Mr Campbell, a former practicing solicitor and Costs Judge, provides a helpful example of another typical type of case where fixed costs would clearly have unfair consequences.
The fallacy of the “One Hat Fits All” approach can be illustrated by a simple example : suppose claimant A and claimant B suffer injuries arising from similar but separate instances of clinical negligence, in respect of which the general damages will not exceed £20,000. Breach of duty and causation are denied, and both claims succeed. Claimant A is elderly and lives on a state pension : claimant B has a substantial income as a career sports player and is compelled to retire prematurely as a result of the injury. It is a statement of the obvious that the lawyers’ task to establish breach of duty and causation will be the same in each case. However, because claimant A, has no earning capacity, special damages will be under £5,000 , whereas for claimant B, compensation will be very significant. If FRC [fixed recoverable costs] were to apply, the solicitor for claimant A would receive far less in costs than the solicitor for claimant B solely because Claimant B was a high earner and claimant A was not, even though the amount of work needed to prove breach of duty and causation in each claim would be identical. A costs regime which can permit such an outcome (as FRC would), will deny justice to deserving claimants for whom solicitors will no longer be willing to act because the FRC will mean that the work can only be undertaken at a financial loss to the firm."
I accept the desire, indeed need, to reduce the amount the NHS is paying as a result of medical errors, but there are other ways of doing this without affecting patient justice. As Desiderius Erasmus once said "Prevention is better than cure." Taking it one step further, Benjamin Franklin commented "An ounce of prevention is worth a pound of cure."
The NHS claims that the supposed rise in the number of claims against them is evidence of a "compensation culture", but is it simply evidence of a failing system? Either way, the best solution must surely be to reduce the instances of medical errors in the first place. Rather than punishing those who have suffered at the hands of the medical profession and who are unfortunate enough to have a low value claim through no fault of their own, why not do all we can to ensure they do not need legal representation in the first place.
As a backup in cases where the Claimant's legal team has incurred disproportionate costs, the new test of proportionality is more than sufficient to ensure only appropriate fees are recovered.
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