GHR review “must take account” of hourly rates solicitors claim

Chamberlayne: Working party needs to consider full spread of data

The Forum of Complex Injury Solicitors has urged the working party reviewing the guideline hourly rates (GHR) to take account of rates claimed as well as those allowed.

It has written to working group chair Mr Justice Stewart to ask him to publish data about rates claimed by solicitors; the interim report published in January disclosed only those allowed or agreed.

FOCIS chair Julian Chamberlayne, a partner at Stewarts, said the GHR were intended to be broad approximations of actual rates in the market.

While the Civil Justice Council working party report said evidence on market rates was elusive, he noted that it gathered both claimed and assessed data for 754 cases.

To look only at the rates allowed without first considering the distribution of the rates claimed, “would effectively be a decision to curtate a distribution without first looking at the full spread”.

He explained: “That would be an approach which, as I understand it, most statisticians would consider to create an inherent bias and breach a fundamental principle of distribution theory.

“Only once you have considered the full spread can an informed decision be made on whether it is appropriate to curtate on one basis or another.”

Mr Chamberlayne offered a simplified example of 10 cases for assessment, with grade A charge rates for each case rising in £10 increments from £300 to £390, all assessed by a judge who never allowed more than £340.

“The mean for the claimed rate would be £345, but the mean for the allowed rate would be £330. The former would be the average market rate, but the latter would not. So, the average of assessed rates will inevitably drag down the outcome and will not then give you a fair figure to reflect prevailing market rates.”

The solicitor warned that there was a risk of “circularity”, with assessed rates influenced by the historic GHR which it was widely acknowledged have fallen well behind market rates.

“The fact grade D rates (aside from London 1) have only had modest rises based on assessed rates, well below the level of any of the potential measures of inflation, perhaps illustrates the suspicion that assessed rates are some way out of line with the real market rates that litigants pay.”

It was also unclear whether the current data took account of reductions in rates allowed due to London solicitors working on cases in regional courts.

“Were those cases included within the London data analysis? If so, that would drag down the mean for rates allowed or agreed for London rates. The same problem would not arise in a comparison of rates claimed for the same cases.”

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