Are Jackson reforms working?

We are now approaching the second anniversary of the Jackson reforms brought in back in April 2013, and one has to question whether they are working. Or have they caused unnecessary suffering for firms of solicitors and misrepresentation from the insurance companies in the first place?

Reports over Christmas suggest they have failed.

The whole premise of the changes was due to excessive legal fees being paid by insurers and by introducing the same, the premiums would be reduced. The government and Lord Justice Jackson agreed. The reforms were introduced, yet latest reports suggest premiums are to rise.

My own experience of the reforms is that access to the courts is significantly worse and that is due to the Law of Unintended Consequences. From my own experience very few multi-track cases proceeded to detailed assessment. There had to be a significant difference of opinion or point of law that required judicial input. As such, only circa 5% of multi-track cases troubled the court. I can understand why Lord Justice Jackson opined that the detailed assessment stage was too late for the court to properly intervene to control costs. However, as a result of the change of stance, every multi track case now troubles the court with Costs Case Management Conferences to deal with costs budgets. As a result, waiting time for hearings has increased considerably.

Another change was the introduction of provisional assessments. Don’t get me wrong as I am a fan of these and currently boast a 100% record on these along with successfully being awarded extras for beating my own Part 36 Offers. However, the attitude from some paying parties comments has left me staggered. I have routinely received terrible offers from paying parties and when asked for an explanation as to the reductions the response was that everyone knows judges get it wrong sometimes so take the money or take your chance. I took the chance with a well presented claim and won. Again as a result of this attitude, recourse to the Courts is taking longer. CPR 47.15 PD 14.4 states the court will use its best endeavour to assess the bill in 6 weeks.  In reality the court has not even got round to setting a date for the provisional assessment in 6 weeks. A recent application to the SCCO for a detailed assessment was made in August 2014 and is not being heard until June 2015.

Best advice? Instruct Costs Draftsmen who know there way around the rules and get the best out of the same.

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The Chinese Curse

“May you live in interesting times” is often described as the Chinese Curse, although according to Wikipedia, the only thing that comes close in Chinese tradition is “rather live as a dog in peaceful times than to live as a human in turbulent times.”

Indeed when Lord Justice Jackson set out to try and simplify the legal world and how much solicitors are paid, I do not think it was foreseen that instead there would be more work for costs draftsman and costs lawyers.

These are indeed interesting times. Regularly attending court to explain how budgets work to mystified judges and opponents alike, a number of brethren costs draftsman have never been busier. There is a wide difference in approach regarding how to prepare budgets and it is therefore critical that an experienced draftsman is utilised and even better  knowing that the draftsman is happy to attend court to explain the same to an often confused Judge who wonders why a budget appears to be claiming £200,000 for something he would only allow £20,000 for if it were to be summarily assessed after a trial.

 

 

Winter of Discontent

So by now you should have read that Mr Mitchell’s solicitors have to pursue the case and will only be able to recover the court fees for anything covered by their costs budget. What about costs not expected? All is not lost as costs of applications can be summarily assessed in addition.

Will the decision of the Court of Appeal help? Hopefully! Rules are rules. At a recent hearing, a. Defendant who had not filed papers in a timely manner were ordered to attend but sit in silence as a result of their inability to meet court deadlines.

Will the outcome of Mitchell be repeated? Not if budgeting is not adopted wholesale by all local DJs. A number of judges either put the issue off until detailed assessment, or don’t deal with it at all! As it is supposed to be a costs managing step, one DJ has already had two hearings as he was not ready to deal with it at the first CMC over the telephone and then ordered a personal attendance. But are the rules not clear that Costs Management Conferences should be dealt with by telephone? Clearly not.

Then, the issue of agreeing the budget arises. How can these be agreed when the defendant senior fraud partner states that ‘this matter is capable of being dealt with by a grade C, pre-action costs are too high, not allowed medical evidence but they are. Costs of £70k are too high’ etc but there’s of £70k are fine! Sort that out in a hearing of one hour before the aforementioned dj who doesn’t want to deal with a 1 hour case and chooses to send it off for detailed assessment which would traditionally take a day. Oh I forgot – it will be a provisional assessment dealt with in 30 minutes.

In case you are thinking I’m in a bad mood, don’t worry – I’ve had a great week and caught a great school’s rugby match. The future’s bright. Lots of work most of which created by all the rule changes, issues resolved and moving on next year to a new position.

Experienced costs practitioners are a rare commodity so choose the best! Try one unbeaten at court in 2013.

Dumbing Down

The ABI have for many years been driving for the whole process for claiming for compensation to be dumbed down.

In fact they go as far to say that there is no need to involve solicitors. They screw down legal fees to the point that the only claimant firms that can do the work are those with low overheads and large volumes.

But now we are seeing the latest trick.

Having made the entire process so simple and dumbed down, they then pick holes in the claim left due to the simplification of the process and imply its sinister. Not just sloppy – sinister

They wheel out senior barristers charging over £5k for a low value fast track trial to not only leave the claimant solicitors with nothing, but the claimants with nothing entirely through the legal profession having to adopt this dumbed down portal forced on the claimants by the ABI who would rather spend £5k on lining the barristers pocket than give it to a claimant.

Is this right?

Claimants and their lawyers need to become masters of pedantry and not lose the art of being solicitors.

Do Judges understand the new rules?

Just like lawyers, there are good judges and those that are less good. But why are they less good? Comments from the judiciary that whilst there’s a queue of family cases, priority will not be given to budgeting does not endear them to fee earners who have had to sweat and pull their hair out trying to get the costs budget right, with the phases correctly described.

The training that they have received is less than a weekly dose of Coronation Street, and the changes to the portal and introduction of budgeting are radical. So is it any wonder judges who were barristers or have long ceased to practice fail to understand the intricacies of the portal?

As such all advocates need an understanding of how these work in order to explain the same to the judge. By being able to explain how these things work at the coal face, the results and outcomes follow.

Instructing an advocate who understands these things is therefore critical to obtain the required results.

Portal Published

And so the statutory instrument enabling the Pre-action Protocol for Low Value Road Traffic Accident, Employers Liability and Public Liability claims has been published meaning it goes live on 31st July 2013.

It covers all claims where damages are between £1,000 and £25,000, and where the CNF is submitted on or after 31st July.

It would have been nice of the rule makers to publish the pre-action protocols to ensure nothing has changed since the draft issued months ago, but that would be too easy.

In the meantime, insurers are getting evidence ready to say that unless an MRI scan can show whiplash claims, then they do not exist. Perhaps the better way would be to line up the insurance executives in their cars and arrange for a controlled car crash to happen-see how long they suffer for.

The only reason for the changes is to allow the insurers to return more dividend to the shareholders and nothing to do with reducing premiums. If it was to do the latter, insurers would employ people with experience to fight unmeritorious claims. As it is, given the dumbing down down of claims, it is arguably easier to progress dodgy claims as no one is there to identify those claims.

Alternative way of looking at it is one big firm of claims handlers fights mesothelioma cases to the doors of court on behalf of the liability insurers and notwithstanding good evidence in support of the defence, caves in. They do it everytime. Why then fight it, causing considerable costs liability to be incurred knowing they will cave in shortly before trial. Why not pay up early or fight to court – not fight then cave in and whine about costs! But its the claimant solicitors who are portrayed to the government as the villains.

Next thing will be Keoghs complaining that there is a lot more cases going to court and they cannot understand why!

Portal Expansion

We are a few weeks away from major upheaval to Employers and Public Liability claims, extension to the portal for RTA claims up to £25,000 and no sign of any rules.

Those who say that we’ve had draft rules are deluded to think this is acceptable. The original proposal was that Stage 3 of the portal was to be commenced when the Court Proceedings Pack was sent to the opponent and yet when the rules were finalised, some ‘drafter’ had for whatever reason decided to state Stage 3 commenced once all the work had been done and when the pack was sent to the Court, thus depriving the Claimant of Stage 3 costs in many cases where the Defendant came to their senses and caved in.

Speaking of badly drafted rules, those who prepared the rules governing budgets should be made to sit in a room and draft 10 budgets and not be allowed out until they have done so, and see then if they think the budgets are a good idea and the format well thought out.  I have the opinion of the local judiciary still ringing in my ear, and it echoes a message posted by Andrew Hogan on his linked in page.

Apologies to those regular readers for not providing many updates – been in the locked room and not allowed out until the budgets were complete.

One month on…

One month on from Jackson implementation day, and what has changed?

Relief from sanctions were supposed to have been beefed up, but reports from court say nothings changed.

Budgeting is now in force, but is this any different to what good practices already did? Good practice stipulates providing the client with an estimate and regular updates being issued before they are exceeded. Costs lawyers and draftsmen have been helping do this for years.

My favourite change is part 36 offers in costs proceedings, capable of resulting in an increase of 10% should the Judge side with the receiving party on an assessment of costs.

As for Qualified One-way Costs Shifting, the Court of Appeal made sure that these survived the first challenge with their decision in Flatman v Germany, whereby they ruled that a solicitor would have to do more than fund disbursements in order that the successful defendant could not argue for a third party funding order and seek costs from the Claimant Solicitor. It was made clear that the Court of Appeal’s decision was made for policy reasons to enable QOCS to have a chance to survive.

The big changes are to come for personal injury lawyers, with the reduction in portal fees coming in and the expansion of portal fees to Employers Liability claims in July along with fixed fees for those cases escaping the portal.

That said, here at Carlisle Legal Costing, we’re one step ahead of the rest with news and views from both working at the coal face and seeing a wide range of practices to help share best practices.

Change Management

Some call it J day, others call it April Fools Day.

Either way 1st April is going to be the dawn of a new era in legal services and its vital for firms to react and adapt. We have had to repeatedly adapt as we grow up and its now different in law firms. Adapting to the new rules, regulations and opportunities is key.

If you need help, a word of wisdom or ideas on survival, do not hesitate to ask. Hesitation will lead to failure.

Good luck

Everyone ready for the Jackson reforms?

I was talking to a solicitor on Friday and was more than a little surprised to find out he had not yet read the proposed changes to CPR, was not aware of the fact that if you actually are entitled to a detailed assessment, you may get to the end and then have a load more knocked off for good measure, and that you were to be obliged to do a budget in multi track cases?

Is all this news to you too?

Get in touch and we can help you and your legal practice get up to speed.