The courts are “very aware” of the dangers of feeding media perceptions of a compensation culture, the Master of the Rolls has said.
Lord Dyson argued that the Jackson reforms – together with a “continued robust approach to the appropriate use of ADR” – will go a “significant way” towards removing improper incentives on people to bring meritless claims and defendants to settle for fear of costs.
However, there needs to be a major public education push to “counter-act the media-created perception that we are in the grips of a compensation culture”, he suggested.
Delivering the annual lecture to the Holdsworth Club – Birmingham University’s student law society, of which he is president – Lord Dyson blamed inaccurate media reporting for creating “a false perception” of a compensation culture (which he defined as the idea that for every injury or loss, there is always someone else to blame and “to borrow the phrase, where there’s blame, there’s a claim”).
He contrasted the infamous McDonald’s hot coffee case in the US – while also explaining that the facts were quite different from the myth – with a similar case brought over here in 2002 which failed. “If, as was suggested in the media a year after this case was decided, we were in the grips of a compensation culture, the claim would surely have succeeded.”
Lord Dyson said: “Our courts are very aware of the dangers of contributing to a climate of encouraging the idea that anyone who suffers an injury must have a remedy in damages. The judges apply the law rigorously.”
The MR added: “In the US there is a rampant litigation culture (although as we have seen even there the media reports are not always accurate). Here there is no such culture. It is not difficult to imagine an entirely positive account being given of the robust nature of our legal system and our substantive law; a positive account, which rather than presenting the view that unmeritorious claims are likely to succeed here, would properly reinforce the view that litigation is not a route to automatic compensation in every case.
“But such a measured and accurate good news story would be unlikely to appeal to the media. Given the ease with which the [UK McDonald’s case] could have been used to exemplify why we are not heading towards a US-style compensation culture, the question arises why it was not.”
He listed familiar stories about bans on conker fights and school sports day sack races which are, he said, wrongly blamed on health and safety legislation: “In both types of case, rather than adopt a position of unthinking criticism, a more balanced, fair and accurate account would have stated that the true position is that we are not in the grip of a compensation culture. Perceptions could have been shaped differently to match the reality.
“Of course, stories written in this way would not have been as newsworthy as those which were written. Nor would they have fitted nicely with the notion that our society is being undermined by over-zealous regulation in the field of health and safety, the growth of the nanny state, EU regulation, a rights-culture and the depredations of fat cat ambulance-chasing lawyers. Indeed, I suggest that such good news stories would simply not be written.”
Lord Dyson predicted that a key impact of the Jackson reforms would be to reduce, if not eliminate, the pressure to settle because of the fear of costs.
“Defendants will be able to secure their right to fair trial, through ensuring that they can properly defend those claims that are properly defensible. As a consequence, I hope that we shall discourage any misguided sense that, simply by raising a claim no matter how hopeless, a claimant will received compensation and costs.”
He also championed the role of mediation, but said the Court of Appeal in Halsey (in which he sat) was right not to require mandatory mediation because otherwise the pressure of having to incur the cost of mediation could again persuade defendants to settle unmeritorious cases.
However, the judge said that with no let-up in media stories about the compensation culture likely, there may need to be “a substantive educative effort on the part of government, the courts and the legal profession to counter-act the media-created perception that we are in the grips of a compensation culture. It may also require greater public legal education.
“Given the possible benefits to society of reducing the perceived need for businesses, local and central government and so on to engage in unnecessarily defensive practices, it is to be hoped that this educative effort will pay for itself.”
In an interview with Litigation Futures, published today, former justice minister Jonathan Djanogly claimed that it is now “a rare lawyer who argues there’s not been a compensation culture”.