Complex injury lawyers urge hourly rate review to recognise specialism

Chamberlayne: Clients should not face costs shortfall

The Forum of Complex Injury Solicitors (FOCIS) has urged the working group reviewing the guideline hourly rates to recognise the need for higher rates for the type of work its members undertake.

It argued that judges ought not to reduce rates at all unless they are outside a reasonable range of market rates for the complexity, value and specialisation of representation required.

FOCIS told the Civil Justice Council group headed by Mr Justice Stewart that complex injury claims have far more in common with complex commercial disputes of equivalent value than fast-track personal injury litigation.

The average damages in the data submitted to the working group – with the assistance of costs firm Harmans – was £4.5m.

The data showed that the market rate for complex injury specialists was “markedly higher” than the GHR; however, while the rates actually allowed were, in most cases, well above the GHR, they were less than the market rate.

The average hourly rates allowed were 87-90% of those claimed, “suggesting the rates as claimed by FOCIS member firms were not excessive”, but only two of the 49 cases had rates allowed as claimed at all grades.

The forum put the figures against the background of post-LASPO claims where, because clients were liable for their own costs shortfall, the market rates “are real client rates, not artificial rates set to maximise indemnity principle cost recovery”.

Further, with complex injury cases typically lasting several years, the significant delay in payment was “a factor justifying the market rates for complex injury claims”.

FOCIS also expressed concern about the “significant risk of circularity” in the review, with other data showing rates that would have been dragged down by the outdated, decade-old GHRs.

“In every costs dispute our members have faced, the defendants have sought reductions in hourly rates with reference to GHR. Even when the matter proceeds to assessment and even if the costs judge departs from the GHR, there are few if any judgments that suggest the cost judge wholly excised them from his or her decision making.

“The FOCIS data suggests that once defendants raise GHR arguments, the vast majority of judges are inclined to give them something for it. That is unfair to claimants who are liable for the shortfall.”

The forum argued that the CJC should adopt for complex injury claims the same approach as taken by Mrs Justice O’Farrell last year in Ohpen, a Technology and Construction Court case in which her comments about the GHR sparked the push to review them.

She said: “Solicitors providing such skill and expertise are entitled to charge the market hourly rate for their area of practice. The hourly rates charged cannot be considered in isolation when assessing the reasonableness of the costs incurred; it is but one factor that forms part of the skill, time and effort allocated to the application.

“It may be reasonable for a party to pay higher hourly rates to secure the necessary level of legal expertise, if that ensures appropriate direction in a case, including settlement strategy, with the effect of avoiding wasted costs and providing overall value.”

Chair Julian Chamberlayne, a partner and head of international injury at Stewarts Law, said: A party to a multi-track claim who makes a reasonable choice of solicitor for the type and scale of the claim in question ought to be able to recover at up to market rate for that work. Otherwise the full compensation principle is eroded.

“These are claims of the utmost importance to our clients who have sustained life-changing disabling injuries and are reliant on the claim outcome to provide for their future financial wellbeing and care needs.

“It is consequently very important that they are able to instruct solicitors with genuine expertise in catastrophic injury claims without resigning themselves to a costs shortfall.”

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