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Rowles-Davies: quadrupled funding facility

Recession-related litigation is growing, new figures have shown, with the number of contract claims in the High Court soaring by nearly half in 2011.

In all 982 contract claims were issued in the Chancery Division 2011, compared to 683 the year before, a rise of 44%, with breach of contract and debt the main causes of action, according to the Ministry of Justice’s recently published annual court statistics.

There were similar trends in other courts – breach of contract claims in the Queen’s Bench Division also rose 44% to 969, while breach of contract/agreement/debt claims in the Commercial Court rocketed 49% to 722.

The sharp rise compared with a more gentle 6% increase in Chancery Division cases overall (to 35,238). This hid significant variations, however, including a 19% jump in intellectual property litigation (to 667 claims) and a 10% rise in Bankruptcy Court applications (to 12,121), as well as a 17% drop in professional negligence cases (to 184), the majority of which were against solicitors.

There was overall a 16% fall in proceedings issued in the Queen’s Bench Division (to 13,928). Of those started in the QBD of the Royal Courts of Justice, a quarter related to debt and around one in five related to breach of contract.

Nick Rowles-Davies of leading third-party litigation funder Vannin Capital said the trends showed how recession-related litigation, such as debt and breach of contract, is playing an increasingly significant role in the courts.

“Our own experience – from the ever-growing number of approaches for funding we receive – matches the trends identified by these statistics. The kinds of disputes the courts are seeing are often caused by the difficult situations people find themselves in during a recession; this is compounded by the fact that, by definition, they struggle to get the money together to take their case to court.

“That, of course, is where we come in and the demand we are seeing is in part why we recently quadrupled our funding facility to £100m for the coming year. This is litigation funding providing access to justice for people who might very well not be able to afford it otherwise.”

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High Court: court should anticipate “evidential developments”

The High Court has issued guidance on how to serve late witness statements in certain circumstances without falling foul of the Mitchell ruling, after refusing relief from sanction when a party tried to do just that on the first day of trial.

Mr Justice Turner said the court should anticipate where there is a realistic possibility of “evidential developments” between the date of serving witness statements and the trial.

Karbhari & Anor v Ahmed [2013] EWHC 4042 (QB) involved a claim for the repayment of monies allegedly advanced to the defendant.

The trial, estimated to last seven days, started on 12 December, but on the first morning the defendant said he would be applying to amend the defence and adduce a supplementary witness statement.

He said his original statement was incomplete because he was trying to protect people who might get into trouble in connection with money laundering, but “now that it is clear to me that the trial is going to go ahead, I have decided that I must tell the whole story”.

Turner J argued that where statements are not served by the date ordered by the court, the party in default must persuade the court to grant relief under rule 3.9 if they want to obtain the court’s permission to adduce them under CPR 32.10.

Applying Mitchell, he refused relief, saying the defendant’s breach was “far from trivial” given the timing and that the supplementary witness statement “sought to introduce wholly new (and inconsistent) material to the case as originally presented”.

He continued: “As to the issue of ‘good reason’, I am entirely satisfied that no good reason has been made out. Money laundering is a serious criminal offence. Omitting until the very last moment large volumes of evidence in order to protect those guilty of this offence on the unwarranted assumption that the case might not come to trial is a thoroughly bad reason.”

The judge also made reference to the wider interests of justice, saying: “Court time is a scarce and valuable commodity which should be fairly distributed between all litigants and extra tranches of which ought not readily to be dispensed to those in serious default whose very failures have wasted such reasonable time as has already been allocated to them.”

For the avoidance of doubt, Turner J said he would have exercised his discretion not to allow service of the statement under CPR 32.10 even if he was wrong about the direct application of CPR 3.9. In the circumstances he struck out the defence and gave judgment for the claimants.

But he went on to sound “a note of caution” about the late service of witness statements generally.

The judge said: “There will be other cases in which there are evidential developments which postdate the time at which earlier witness statements have been served. It is, by way of example only, by no means unusual in personal injury cases for updated witness statements to be served in order to cover a claimant's progress over the period since the original witness statements were served.”

He said this situation fell within the approach of the Court of Appeal in Mitchell, when it ruled that “later developments in the course of the litigation process are likely to be a good reason if they show that the period for compliance originally imposed was unreasonable, although the period seemed to be reasonable at the time and could not realistically have been the subject of an appeal”.

Turner J continued: “In cases in which there is a realistic possibility that there will be evidential developments between the date upon which witness statements are to be served and the trial date this ought to be anticipated in the orders of the court.

“In such cases, the wisest course would be to seek to persuade the court to make two orders relating to the service of witness statements. The first would provide for a date which would give a realistic opportunity for all sides to comply with respect to matters which have arisen beforehand.

“A later backstop date could be ordered for the service of supplementary statements limited in content to matters which occurred, or were reasonably discoverable, only after the first date. This would have the advantage of obviating the need for further applications to the court and of giving the court the opportunity to exercise proportionate case management discipline in advance.

“In this way, in the vast majority of cases the unanticipated last minute service of witness statements should become a thing of the past. I would expect the same to apply to expert reports.”

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EclipseFounded in 2001, Leeds based Michael Lewin Solicitors has grown into a large nationwide personal injury practice employing over 120 staff across five offices.

Back in 2009 Michael Lewin needed to replace its incumbent case management system with a platform and a supplier that were in line with aggressive growth plans. The solution needed to be easy to use, scalable and allow for high volumes of cases to be processed whilst maximising client service.

A Proclaim Practice Management System was chosen and is utilised by all Michael Lewin staff, providing a core centralised solution for a range of injury claim types from minor RTA (Road Traffic Accident) claims – processed seamlessly with Proclaim’s Application to Application integration with the Government’s Claims Portal – through to £multi-million Clinical Negligence matters. The firm also adopted Proclaim as its practice accounting and reporting toolset, providing full integration with fee earner activity. Eclipse also conducted a data migration from the incumbent solution.

Michael Lewin has announced explosive growth at a time of challenging legislation for claimant solicitors. Since implementing Proclaim in 2009, headcount has grown from 15 to over 120, an increase of over 700%. Michael Lewin’s expansion is not complete; Proclaim’s flexibility has been invaluable in allowing the firm to introduce a range of non-personal injury services – all using Proclaim – including debt recovery and employment work.

“Proclaim has delivered over and above expectations, providing an easy to use and incredibly scalable solution. We can process claims with greater speed, greater accuracy, and in greater volumes.” – Abbie Keech, Director, Michael Lewin Solicitors

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A funder’s dream: Plies of proposals

Posted by Chris Deadman, director of operations at Litigation Futures Associate Invicta Capital Funding 

This is my valedictory blog for 2017. I am grateful to my loyal reader for enduring the polluted flushings of my diseased mind over the past six months. It has been fun to write and I hope that I have given the reader an insight into the world of a litigation flaneur.

Before I bid you happy holidays, I would like to share with you my two wishes for Christmas. For the avoidance of doubt, these relate to litigation finance and not my personal desires, which include a solid gold house, rocket shoes and the power to become invisible at will.

My first wish is that lawyers finally understand how litigation finance operates and how it can help to build them a successful and profitable practice.

Complicated and time-consuming application processes have been a barrier to accessing external finance in the past but things are changing.

Some completed third-party funding application forms that I have seen resemble one of those fabulously intricate mediaeval illuminated manuscripts by Sibilla Von Bondorf depicting the life of St Francis. But there are funders out there who adopt a far more pragmatic approach and simply want to deploy their cash quickly and cost-effectively into suitable matters.

These financiers are a welcome departure from the cumbersome and uncertain processes which have characterised the industry in the past.

My second and final wish is for there to be a greater number of cases financed in 2018. I have no doubt that we are seeing but a small percentage of the total pool of eligible cases. I cannot help thinking that there are many decent matters lurking in law firms across the country that would benefit from external finance.

More than that, I bet there are many meritorious cases that never get as far as a solicitor because of the claimant’s perception that litigation is simply too expensive and uncertain.

These are the types of cases that I and my competitors will be working hard to identify in 2018. And on that optimistic note, I wish you and yours a happy Christmas and a healthy and prosperous New Year.

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Hayman: Ruling provides clarity

The debate over whether a costs judge who reduces the hourly rates for incurred costs should then do the same to budgeted costs is set to rumble on after the case that was heading to the High Court settled and another ruling was added to the mix.

Last year, in RNB v London Borough of Newham, Deputy Master Campbell ruled that reducing the hourly rates for the incurred costs meant there was a “good reason” to reduce the budgeted costs too.

However, in Bains v Royal Wolverhampton NHS Trust, District Judge Lumb, sitting as a regional costs judge, expressly disagreed with this position.

RNB was due to be heard this Friday, but Sam Hayman, senior associate in the costs team at London firm Bolt Burdon Kemp, which acted for the claimant, told Litigation Futures that it has just settled.

“The defendant made an offer significantly in excess of the sums in issue in the appeal. While it was important that the principle be clarified by a higher court, the claimant rightly accepted the generous offer.”

However, today Master Nagalingam in the Senior Courts Costs Office has handed down judgment in another Bolt Burdon Kemp case which dealt with the issue, Nash v MOD Approved Judgment.

According to Mr Hayman, he held that an adjustment to the non-budgeted hourly rates was not a good reason to depart from the approved or agreed costs budget.

Master Nagalingam earlier in the detailed assessment had reduced the hourly rates in respect of incurred costs.

But asked by the defendant to do so in relation to the budgeting costs, he said: “Hourly rates hold no special status and are not to be given any elevated status on an assessment of costs with regards to estimated costs subject to a costs management order.”

The master referred to the proportionate total allowed at a case management conference being based upon “a variety of factors, including the incurred costs. A party therefore proceeds with certainty as to what is a proportionate future sum to spend per phase.

“That certainty is entirely eroded if hourly rates are then given a form of special status which requires rates to be assessed in the estimated phases of a bill of costs.”

Mr Hayman said: “This judgment provides a thorough consideration of the relevant law and has given clarity to what is a highly contentious issue of detailed assessment.

“Whilst this is a first-instance decision, the well-reasoned judgment is likely to prove useful for parties on detailed and summary assessment where costs budgeting has previously taken place.”

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Ashton West

West: shared success

Ashton West, chief executive of the Motor Insurers’ Bureau (MIB) since 2003, has been awarded an OBE for services to road safety.

Mr West was a founder member of the Civil Justice Council and is a member of the Association of British Insurers’ motor committee and personal injury panel.

He was a member of the working party which developed the personal injury pre-action protocols and the code of best practice on rehabilitation. He was also involved in the negotiation of agreements on the resolution of large-scale industrial disease claims.

A spokesman for the MIB said that since 2005 the number of uninsured drivers had dropped by 50% to around one million, while the cost of claims involving uninsured or ‘hit and run’ drivers had fallen from £417m in 2008 to £247m in 2014.

The spokesman said a “key factor” in the success was investment in the Motor Insurance Database. He said that since 2011, MIB had worked in partnership with the DVLA to introduce ‘continuous insurance enforcement’, which systematically matches records of vehicle keepers with insurance records on the database.

Steve Maddock, chairman of MIB and managing director of claims and business services at Direct Line Group, said the bureau was using technological advances and work with enforcement agencies to remove “drivers who flout the law” from the roads.

“Under Ashton’s guidance, the MIB has transformed itself and while it may not be visible to everyone, its impact is far-reaching.”

Before joining the MIB, Mr West had management roles in the insurance industry at Iron Trades Insurance and Rubicon Limited, was chairman of ReIntra and a claims consultant at Bavarian Re UK.

A law graduate, he described the award of an OBE as a “shared success”.

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eter Garsden of QualitySolicitors Abney Garsden talks about how EclipseProclaim assists with compliance and creates a paperless working environment.

About QualitySolicitors Abney Garsden:

  • Specialist law firm and the UK’s largest child abuse compensation team in the UK
  • Award winning practice
  • Committed to the highest quality service


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Chris Grayling

Grayling: “frustrated and angry” at loss of so much public money

The solicitor for the Plantagenet Alliance has said that an appeal is “under consideration”, following last week’s High Court ruling on the fate of Richard III’s remains.

Justice secretary Chris Grayling said that he was “pleased” that the court had rejected arguments that an exhumation licence should not have been granted by the government, but “frustrated and angry” that the alliance had “taken up so much time and public money”.

Mr Grayling described the alliance, which brought a judicial review challenging the decision taken by his predecessor Ken Clarke to grant a licence, as having “tenuous claims to being relatives of Richard III”.

The justice secretary went on: “This case, brought by a shell company set up by the Alliance to avoid paying legal costs, is an example of exactly why the government is bringing forward a package of reforms to the judicial review process.

“I have been very clear from the start that the decision to grant an exhumation licence for Richard III was taken correctly and in line with the law.”

Mr Justice Haddon-Cave held at the High Court last summer that it was “plainly arguable” that there was a common law duty on the justice secretary and the University of Leicester to consult on the reburial of Richard III.

At a separate costs hearing in October, the same judge rejected an attempt by the Ministry of Justice to overturn a protective costs order awarded in favour of the alliance, protecting it from paying the defendants’ costs if it lost.

However, the High Court ruled last week that the former justice secretary was not under a duty to consult before granting an exhumation licence, and there were “no public law grounds” for the court to interfere with his decision.

In a joint ruling, Lady Justice Hallett, Mr Justice Ouseley and Mr Justice Haddon-Cave said: “In truth, the ‘public’ consultation regarded by the claimant is entirely open-ended and not capable of sensible limit or specificity, in the context of potentially millions of collateral descendants of Richard III.

“Further, in order to articulate how such a complex consultation would be carried out, a detailed process would have to be prescribed in a manner akin to legislation.”

Matthew Howarth, partner and head of commercial litigation at Gordons, acted for the Plantagenet Alliance. He said an appeal against the High Court ruling was “under consideration”, but declined to respond to the justice secretary’s criticisms of the judicial review.

The day before he was replaced by Chris Grayling in a cabinet reshuffle in the summer of 2012, former justice secretary Ken Clarke granted a licence to Leicester University to remove the remains.

They were found in a council car park near the site of Gray Friars Church in Leicester, where Richard’s body was taken after the Battle of Bosworth.

The licence obtained by the university under section 25 of the Burials Act 1857, referred only to “persons unknown”.

However, the university’s archaeological service announced on 12 September 2012 that preliminary investigations indicated the remains were Richard III. This was confirmed the following February.


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Private conversation: Judge made several errors, says CA

A circuit judge was wrong to have a private conversation with one party’s counsel during the trial, but his actions did not amount of apparent bias, the Court of Appeal has ruled.

Deputy District Judge Wallis asked to speak to Rahul Varma to thank him and his then chambers – Lamb Chambers – for giving his daughter a mini-pupillage the previous summer, but then briefly discussed the case too.

He asked Mr Varma, who acted for the claimant, to pass on comments to opposing counsel, Niraj Modha, insofar as it might help both counsel to compile a list of issues. Mr Varma did so later that evening.

The judge said the defendant’s counterclaim seemed weak and the claimant’s case had several evidential gaps.

DDJ Wallis refused a request by the defendant to recuse himself as a result of the exchange, and in the substantive case rejected the defendant’s appeal against an order to pay the claimant £24,000 in unpaid invoices for building work.

After His Honour Judge Freeland QC dismissed an appeal, the defendant appealed to the Court of Appeal solely on the issue of apparent bias.

It argued that, in circumstances where the trial judge had expressed his views on the case to the claimant’s counsel during an unrecorded private conversation without its counsel being present, a fair-minded and informed observer would conclude that there was a real possibility that the judge was not impartial.

Giving the judgment of the court, Lord Justice Leggatt said DDJ Wallis’s first mistake was to request a private conversation with counsel for one of the parties in the absence of the other while the case was continuing.

“It is difficult to think of circumstances in which this would be an appropriate thing to do. It risks fostering an impression of favouritism towards one party’s advocate. It also encourages suspicion in the other party (even if the suspicion is in fact unfounded)…

“For the trial judge to go out of his way, during the trial, ‘personally to thank Mr Varma for his hospitality towards [his] daughter’ was capable of suggesting that he felt a sense of obligation towards Mr Varma.”

The “second and worse error” was to talk about the case “and, more than that, to express views about the merits of the parties’ respective cases”.

Leggatt LJ said he was “distinctly unimpressed” with the judge’s explanation that “I was concerned that Mr Modha should be made aware, as quickly as possible given his professional commitments, of my concern about the evidential weaknesses”.

Leggatt LJ said: “When the conversation took place, the trial had been adjourned for closing submissions and no timetable for these had yet been set. It had further been agreed that, before preparing their submissions, the two counsel would liaise with each other to compile a list of issues.

“It is very difficult to see how in these circumstances the judge’s concern about the perceived evidential weakness of the counterclaim was a matter of which Mr Modha needed to be made aware ‘as quickly as possible’ (whatever Mr Modha’s forthcoming professional commitments).

“Furthermore, the suggestion that the matter was of such urgency that it needed to be passed on immediately and could not wait until the judge was able to communicate with Mr Modha himself late that night or the following morning is – to put it bluntly – absurd.”

There were further errors – DDJ Wallis sent Mr Modha an email the following day recounting his comments, but leaving out those concerning his opponent’s case.

Another email a few days later seemed to suggest that he would recuse himself if the defendant asked him to, but he declined when it did.

However, despite these errors, the Court of Appeal found that there was no real possibility that a fair-minded and informed observer would consider the judge biased.

Leggatt LJ said the mini-pupillage “could not sensibly have been thought to give rise to any risk of bias”, and the defendant had “quite properly” made no objection to the judge hearing the case when Mr Varma disclosed that fact to his opponent before the hearing.

The judge’s comments would have been perfectly proper if made in open court and the defendant had considered them innocuous.

“It is, however, of critical importance that the judge, in making the comments that he did (i) made it clear that his purpose was to assist both parties in preparing their closing submissions, and (ii) specifically asked Mr Varma to pass on the comments to his opponent (which Mr Varma did).

“This demonstrates that the trial judge was not giving or seeking to give one party a privileged insight into his thinking which was not being afforded to the other.”

NOTE: The original version of this story named HHJ Freeland as the judge whose conduct was under fire, rather than DDJ Wallis. We apologise for the error. 

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Amendments: accurate record

It is not “wrong in law” for judges to amend transcripts of judgments to better explain the reasons behind their decisions, the High Court has held.

HHJ Paul Matthews, sitting as a High Court judge, said judges “may properly be asked to clarify or amplify the reasons originally given in a judgment” even after delivery of that judgment.

“Indeed sometimes it may be the duty of counsel to ask the judge to do so, or the judge may consider the matter on his or her own initiative.”

HHJ Matthews said that if a judge considered that the oral transcript of a judgment did not “accurately represent his or her reasons for the decision”, the judge could alter it so it did accurately record the reasons.

“More, if the judge changes his or her mind as to the reasons for a decision or (in certain cases) changes the actual decision, then the judgment can be altered too.

“As a result, it does not matter if the approved transcript adds to or differs from the actual words used by the judge at the time of giving judgment.

“What matters is only that it has been considered, revised if necessary, and then approved by the judge. And that is what appears to have happened in the present case.”

The court heard in Bath v Escott [2017] EWHC 101 (Ch) that David Escott applied for the release of an audio recording of a judgment given at the Bristol District Registry of the High Court in August 2014.

HHJ Matthews described how Mr Escott claimed in his application that the transcript was not “true to what was said in court”, but did not give any details.

Whatever the position, HHJ Matthews said the mere fact that a transcript of the judgment, approved by the parties, was “in any way different from the reasons actually pronounced by the judge” at the time he gave judgement was not “wrong in law”.

He went on: “It is an entirely lawful and proper practice for a judge, on receiving a transcript of what was said at the time in giving judgment, to alter that transcript, not only to correct garbled or incorrect transcriptions, spelling and grammatical mistakes, and even matters of style, but also so that the reasons recorded accurately reflect why the judge made the decision that he or she made, even if they were not then properly or fully articulated.”

The judge said orders of the court expressed the courts’ decisions, while judgments expressed only the courts’ reasons for those decisions.

“Thus when the judge decides a case, it is the order that is made at the end that is all-important, and the reasons simply explain the basis for the decision.

“Of course, when an appeal court considers an appeal against an order, it will want to see what the reasons were. But even if the reasons were wrong, the decision might still be right, and in that case the appeal would be dismissed.”

HHJ Matthews said it had been “established for several decades” that even after handing down a judgment a judge is entitled to amend it and even change the decision itself before the order was sealed.

He dismissed the application as totally without merit.

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ARAG has welcomed new consumer regulations for add-on sales as a positive step towards ensuring that specialist insurance products are only retailed by experts. The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations that have just come into force provide two specific changes that affect brokers and ensure customers get a fairer deal.

Products that are ancillary to the main purchase, such as travel insurance on package holidays, can no longer be sold on an opt-out basis. Typically this means that a pre-ticked box is not allowed as consumers must take the initiative to opt-in, knowing what they are requesting and what it costs. And if the main contract is cancelled the add-on must automatically be terminated and refunded. A second requirement is that any post-contract helplines should be charged at basic rates and not surcharged in any way.

“Buying the correct insurance should be an informed choice” says ARAG Head of Underwriting & Marketing, David Haynes. “The new regulations provide a great opportunity for intermediaries to create new schemes across a wide range of consumer purchases that might require an insurance add-on such as legal or emergency cover. For too long, add-on purchases have been open to mis-selling whereas the tightly controlled broker market has been retailing appropriate yet sometimes complex products effectively and in large volumes.

“Whilst welcoming these new regulations – which mirror conclusions in the FCA review of add-ons that preceded them – we do hold reservations over the ‘sunlight remedy’ on claims ratios proposed in the review and will continue to explain our rationale at every opportunity”.

To see ARAG opinion on the FCA final report into add-on insurance products please see the link below.

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Carrington: insurers will be more willing to defend passenger claims

Carrington: insurers will be more willing to defend passenger claims

A recent county court decision on ‘fundamental dishonesty’ opens up a “new avenue for insurers”, leading defendant firm DAC Beachcroft has claimed.

According to counter fraud partner Anthony Carrington, the decision “rewrites the rulebook” for defending ‘bogus passenger’ claims.

The claim in Shahid v Puddick was made following a car accident in 2014. The defendant had indicated that only one of the three claimants was genuine, so insurers decided not to settle the genuine claimant’s claim as she had supported two bogus personal injury claims.

Mr Carrington recorded that the trial judge agreed, describing the entire action as dishonest. He concluded that two of the three claimants had not been present at the accident and then went on to dismiss the ‘genuine’ claimant’s claim, which was worth £2,000. The claimants were also ordered to pay the defendant’s costs.

Mr Carrington, said: “The decision is great news for the insurance industry and marks a significant shift in case law relating to ‘genuine’ claimants who support fraudulent claims. Before the introduction of the Criminal Justice and Courts Act 2015, insurers had little alternative but to settle ‘genuine’ claims.

“Insurers should take confidence from this outcome and not look to settle claims where the ‘genuine’ claimant is supporting bogus claims by individuals who were never involved in the accident.”

DAC Beachcroft said that in the last year, it has had more than 140 claims dismissed at trial or final hearing on grounds of fundamental dishonesty, saving insurers more than £1.4 million in damages and costs. Costs have been assessed in two-thirds of the cases, leading to costs orders totalling over £440,000 being awarded to insurers.

Mr Carrington could not say how many times the firm had claimed fundamental dishonesty and failed, but he said that as it only made the allegation at the end of a case when the facts were clear, they “generally succeed”.

An analysis of all the fundamental dishonesty findings obtained by the firm found that 43% involved fraudulent low velocity impact claims, while more complex frauds where accidents were induced or staged accounted for around 38%. Fewer than 10% of the fundamental dishonesty decisions related to bogus passenger claims.

“Now that the case law in defending this type of fraudulent claim has been so substantially altered, we expect insurers will be more willing to defend these cases in their entirety so bogus passenger claims will account for a greater proportion of fundamental dishonesty results in the future,” said Mr Carrington.

He added that checking a claimant’s social media activity was becoming increasingly important in tackling fraud.

“In a number of these fundamental dishonesty cases, our intelligence team’s investigations of the claimants’ own social media activity unearthed some gems of evidence, which contradicted what the claimants had alleged in their claims.

“In one case, the claimant alleged that his injuries came on within 24 hours of the accident and that he had been unable to go running but his social media showed that the claimant had, in fact, completed a 10km run the day after the accident, recording a personal best time. Following the cross examination at trial, the claimant discontinued and agreed to pay costs in excess of £10,000.”

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termination of employment

Employment tribunals should also “have regard to cost”

Employment tribunals should have regard to the “insight given by cases such as Mitchell” into what constitutes justice, Mr Justice Langstaff, president of the Employment Appeal Tribunal, has ruled.

The president said justice was “not simply a question of the court reaching a decision that may be fair as between the parties in the sense of fairly resolving the issues – it also involves delivering justice within a reasonable time.”

Langstaff J said employment tribunals must “also have regard to cost”.

“Even if the employment tribunal is not in the same position as the civil courts because there is no cost-shifting regime, it was designed as a cost-free forum in so far as party-and-party costs were concerned.”

Delivering judgment in Harris v Academies Enterprise Trust and others (UKEAT/0097/14/KN), Mr Justice Langstaff said “overall justice” also meant that “each case should be dealt with in a way that ensures that other cases are not deprived of their own fair share” of court resources.

“If a case drags on for weeks, the consequence is that other cases, which also deserve to be heard quickly and without due cost, are adjourned or simply are not allotted a date for hearing.”

Langstaff J said employment tribunal rules had not “lagged behind” the CPR, but were “freshly and newly drafted and brought into force in 2013 in full knowledge” of the approach the CPR were taking.

The president said it was difficult to “draw too much” from Denton or the other cases following Mitchell, and employment tribunals were not expected to “deal with a claim as if the CPR applied when they do not”.

However, he added: “I do not wish what I have said to let it be thought that judges should be unduly forgiving of procedural default by parties.

“Rules are there to be observed, orders are there to be observed, and breaches are not mere trivial matters; they should result in careful consideration whenever they occur.

“It is a matter of frequent complaint to this tribunal, in particular by litigants in person, that orders have not been observed to the letter by the other party to the litigation.

“Tribunal judges are entitled to take a stricter line than they may have taken previously, but it remains a matter to be assessed from within the existing rules and the principles in existing cases.”

Rejecting the claimant’s arguments that the response should be struck out following a failure to exchange witness statements, Langstaff J dismissed the appeal.

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Coulson: Not a lacuna in the CPR

The rules on qualified one-way costs shifting (QOCS) do not prevent a successful defendant in a multi-defendant claim recovering their costs from the damages awarded against a different defendant, the Court of Appeal has ruled.

However, it held that this right could not be enforced where the damages were payable under a Tomlin order, as it was not a direct order of the court.

This has led to a call for the Civil Procedure Rule Committee (CPRC) to address the issue, which also affects part 36 offers.

In Cartwright v Venduct Engineering Ltd [2018] EWCA Civ 1654, the claimant issued proceedings against six named defendants for noise induced hearing loss (NIHL). The third defendant, Venduct, accepted that it was responsible for any liability that was established on the part of the first and second defendants.

The claimant then settled with the fourth, fifth and sixth defendants, who agreed to pay him £20,000. This was recorded in a Tomlin order. The claimant then served a notice of discontinuance in respect of the claim against Venduct.

Venduct sought its costs of £8,000 from the claimant; under the QOCS rule 44.14(1), a successful defendant can enforce a costs order up to the damages recovered by the claimant.

At first instance, Regional Costs Judge Hale in Nottingham held that the Tomlin order did not meet the requirement of the rule that such costs could only be paid from an “order for damages and interest”.

The schedule to a Tomlin order was not an order of the court, he said.

He also ruled that Venduct would have been entitled under rule 44.14, in principle, to enforce its costs order against the claimant, even though the source of the claimant’s funds was another defendant.

Giving the unanimous decision of the Court of Appeal to uphold this decision, Lord Justice Coulson said the QOCS regime was designed to ensure that a claimant did not incur a net liability as a result of his or her personal injury claim: that, at worst, he or she has broken even at the end of the action.

“Any other result would give a claimant carte blanche to commence proceedings against as many defendants as he or she likes, requiring those defendants to run up large bills by way of costs, whilst remaining safe in the knowledge that, if the claim fails against all but one defendant, he or she will incur no costs liability of any kind to the successful defendants, despite the recovery of sums by way of damages from the unsuccessful defendant.

“That seems to me to be wrong in principle, because it would encourage the bringing of hopeless claims.”

Coulson LJ also upheld the decision on the Tomlin order, even though he was “acutely aware” that it may encourage a claimant to use this approach to avoid having to pay a successful defendant’s costs order.

He said the authorities were clear that a Tomlin order could not be described as “an order for damages and interest “. As a record of a settlement designed to have binding effect, it was no different from part 36, which Coulson LJ said would also be outside rule 44.14(1).

“It does not seem to me to have been an oversight or a lacuna in the CPR: if it had been the intention for rule 44.14(1) to cover settlements of whatever kind, different words and greater guidance would have been required.”

The judge did not express an opinion on whether the rules needed to be changed, saying it was a matter for the CPRC – which as deputy head of civil justice he is the de facto chair.

Jeremy Rea, a solicitor in the Leeds office of BC Legal, who acted for Venduct, said the CPRC needed to look at the Tomlin order issue.

“Not unlike tax avoidance, it might be argued this is QOCS avoidance and an anomalous loophole that surely needs to be closed,” he said.

“Not only do we have the oddity of damages payable under a plain consent order being caught by 44.14 but damages payable under a Tomlin order not so, but also a settlement achieved by a part 36 mechanism is not covered.”

But Mr Rea said the ruling was otherwise good news for insurance companies. “In multiple defendant disease cases, particularly NIHL, there is dismay at the irresponsible attitude of some claimant firms to litigation, adopting a scattergun approach, suing very many employers with what very often appears to be little heed for the merits, in the Micawberish hope that ‘something will turn up’.

“Only too often, that manifests itself in an unmeritorious claim being pursued up until the very last before a notice of discontinuance is served.”

He said the ruling was “a major step in the right direction” towards re-establishing a fair balance between the competing interests of claimants and defendants.

“Cartwright has brought us half-way across the finishing line in terms of addressing the imbalance. We now need the CPRC to ensure that the undercarriage follows along.”

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High Court: absence of “significant prejudice of any kind to anyone”

The High Court has overturned a cost judge’s refusal to grant relief from sanctions that prevented claimant lawyers from recovering their success fees, and instead accused the defendants of “unreasonable and opportunistic” conduct.

Master Rowley had admitted to “qualms” over the sanction he imposed earlier this year for failure to serve copies of conditional fee agreements and success fee details, but felt compelled to do so by the Mitchell ruling.

Mr Justice Barling said that, even without the subsequent ruling in Denton, he would have regarded the breach as “trivial and insignificant”, adding that there was an absence of “significant prejudice of any kind to anyone”.

Barling J went on: “It is clear, as the judge found, that there was no significant prejudice to the defendants, or to the efficient conduct of the assessment proceedings at proportionate cost, or to the court or to other litigants as a result of the breach itself.

“It is evident that in so far as there has been unnecessary cost, delay and use of the court’s finite resources in hearing the application for relief from sanctions and this appeal, this is the result of what in my view was the unreasonable, opportunistic and non-co-operative approach of the defendants to the claimant’s unfortunate oversight.”

Delivering judgment in Long v Value Properties and another [2014] EWHC 2981 (Ch), Mr Justice Barling said Master Rowley had not received “the assistance he should have done” with interpreting the meaning of triviality.

“His instinct was to hold that the breach was trivial but he appears to have fallen into the error by attaching insufficient weight to the circumstances surrounding the breach as well as to the absence of any significant prejudice of any kind to anyone.

“The judge also appears to have fallen into the error identified by the majority in Denton, in that having concluded the breach was not trivial, and that there was no good reason for it, he regarded the application for relief from sanctions as bound to fail.”

Barling J held that although overlooking the requirements of a practice direction was not a “good reason” for a breach, when all the relevant circumstances were considered, including the speed with which the claimant remedied the default and applied for relief, complete relief from the sanction should be granted.

He added: “Had the defendants taken a different course the matter could probably have been completely resolved within the overall period of the extension of time which they applied for and were granted by the claimant, or very soon thereafter.

“This would have saved the parties and the court the time and expense of a lengthy hearing before the judge and an even longer appeal hearing before me.”

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Neuberger: figures are very disturbing

The pre-Jackson regime of recoverable success fees and after-the-event (ATE) insurance may breach the European Convention on Human Rights, with “very serious consequences for the government”, the Supreme Court suggested yesterday.

Lord Neuberger, the court’s president, said that if this argument was right, those who paid out disproportionate additional liabilities “may well have a claim for compensation against the government for infringement of their article 6 rights”. Article 6 is the right to a fair trial.

Implicitly acknowledging the tide of litigation that could follow such a decision, he did not take the argument any further at this stage, saying the government needed the chance to address the court.

Coventry v Lawrence (No2) [2014] UKSC 46 concerned a successful private claim for nuisance brought against the occupiers of a speedway track by two local residents. In a case run under the pre-Jackson costs regime established by the Access to Justice Act 1999, the residents won at first instance, a decision overturned by the Court of Appeal before being restored by the Supreme Court earlier this year. The two respondents were ordered to pay £10,350 each in damages, and 60% of the appellants’ costs.

The appellants’ base costs from the original trial were £398,000, plus a success fee of £319,000 and ATE premium of about £350,000, totalling £1,067,000. This meant the respondents were liable for over £640,000, even before the costs of the two appeals were considered.

“These figures are very disturbing,” said Lord Neuberger, giving the main ruling. “They give rise to grave concern even if one ignores the success fee and ATE premium. The fact that it can cost two citizens £400,000 in legal fees and disbursements to establish and enforce their right to live in peace in their home is on any view highly regrettable…

“The point can equally forcefully be made from the point of view of the respondents. As relatively small business operators, they are not only having to fund their own costs, which presumably would be of the same order, but in addition they are going to have to pay some £240,000 towards the appellants’ costs. It is true that the respondents lost, but they were seeking to defend their businesses and they plainly had a reasonable case, as is evidenced by the fact that they won in the Court of Appeal.”

Lord Neuberger acknowledged how hard it is to ensure that “a case, particularly one that does not involve a very large sum of money but is potentially complex in terms of fact, law and expertise, such as the present case, is both properly and proportionately litigated”.

But he continued: “It would be wrong for this court not to express its grave concern about the base costs in this case, and express the hope that those responsible for civil justice in England and Wales are considering what further steps can be taken to ensure better access to justice. It is only fair to emphasise that this concern relates to the current system and that it is not intended to imply any criticism of the lawyers in this case.”

Lord Neuberger made plain his support for the Jackson report changes introduced by the Legal Aid, Sentencing and Punishment of Offenders Act 2012, noting among other criticisms of the old regime that while proportionality had a part (albeit limited) to play when assessing the recoverability of base costs, it was excluded from consideration in relation to the recovery of success fee or ATE premium, which were simply required to be reasonable.

Lord Neuberger said the development of European Court of Human Rights jurisprudence – including in the Naomi Campbell case – in recent years meant the court could reconsider the question of whether the 1999 Act costs regime infringed the convention, despite the earlier House of Lords rulings in Callery v Gray and Campbell that it was lawful.

“In the light of the facts of this case and the Strasbourg court judgments relied on by [the defendants], it may be that the respondents are right in their contention that their liability for costs… would be inconsistent with their convention rights,” he said.

The judge also considered how the case may proceed, saying it could be that the Court of Appeal, or even the trial judge, should consider the issue first. There is likely to be a hearing to decide this with all those involved, including any relevant interveners.

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The John M Hayes Partnership Ltd

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John M Hayes exists to increase profitability for Solicitor Firms, Corporate Bodies, Law Centres, Local Authorities, Police Authorities, Family Fee Earners and Charities be that by maximising legal costs recovery or reducing unnecessary pay outs for Defendants.

We provide specialist advice across the whole spectrum of legal costs including bill drafting, technical advice, representation at detailed assessments and submissions to the Legal Aid Agency. We are CCMS specialists, recognised national trainers and retain strong working partnerships with London Legal Support Trust (LLST) and the Legal Aid Practitioners Group (LAPG).

Our substantial client base covers both Claimant and Defendant work from regional centres across the UK. Our sector experience ranges from clinical negligence, personal injury and travel litigation to Court of Protection and Solicitor Act Assessments alongside a thriving and ongoing commitment to legal aid and costs awards in publicly  funded cases where we have been at the forefront of costs for over thirty years.

We build working partnerships with our clients delivering a consistent, reliable service based on quality and commitment.

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Ruffle: law will only be open to those who can afford it

Ruffle: law will only be open to those who can afford it

The after-the-event insurer which saw its premium halved by the Senior Costs Judge in his controversial application of the post-Jackson proportionality test said today it should not apply to those areas of litigation where additional liabilities are still recoverable.

Temple Legal Protection said it was supporting the claimant’s bid to appeal in BNM v MGN, arguing that the ruling risked reducing claimants’ access to justice.

The case has been much talked-about by costs specialists and Temple said the ability for individuals and businesses to litigate was under threat from “a judgment that implements a new costs regime with no indication on how to make an assessment of what is proportionate.

“The implications for this judgment are that the rule of law will only be open to those who can afford it.”

Steve Ruffle, Temple’s senior underwriting manager for commercial ATE claims, said: “In my view, the Senior Costs Judge is wrong to apply the new proportionality costs regime to areas of the litigation landscape where additional liabilities are still recoverable.

“Parliament has determined that, in certain categories of case, this method of funding to ensure access to justice must continue and, therefore, the new test of proportionality has no part to play when assessing additional liabilities.”

He noted that even though the judge found the ATE insurance premium was set at a reasonable level, and that it was necessary for the claimant to purchase ATE, “the judge has slashed this figure in half with no apparent justification”.

Mr Ruffle added: “My deepest concern is that this judgment will be used by well-resourced defendants, who can afford not to recover all of their costs, to run up their legal spend knowing full well that a claimant would not be able to match this and, therefore, could only recover a level of costs in line with their damages.

“This flies in the face of the recent judgment in Miller v Associated Newspapers Limited where the Judge found that ‘ATE provides a legitimate social purpose’ and that the ‘burden imposed by the ATE premium scheme is not so large and not so lacking in appropriate controls as to amount to a disproportionate inference in their right to freedom of expression’.”

He argued that ATE should be considered in the context of the risk assumed by Temple, rather than against the level of damages being claimed. “In addition, a premium for a particular case must be considered in the context of a book of similar cases insured.”

Mr Ruffle said Master Gordon-Saker did not apply the principles laid out in the 2007 Court of Appeal case of Rogers v Merthyr Tydfil BC that any necessarily incurred premium would be proportionate but also that any challenge to or reduction of the ATE premium should be based on evidence which was absent in this case.

“Temple’s premiums have been set at an appropriate level using years of underwriting data and experience. Many of the country’s leading media law firms rely on the backing and support of Temple in order to pursue claims for their clients. If premiums are unreasonably reduced, this will limit our ability to support meritorious claims going forward and restrict access to justice.”

Nigel Tait, managing partner and head of media law at renowned media claimant firm Carter-Ruck – who was not involved in the case – said that the ruling would mean that only the “super rich” would be able to bring proceedings for misuse of private information.

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Cut of the pie: Bid to challenge deduction derailed

Yet another bid to obtain the part of a personal injury (PI) file over which the solicitor has proprietary rights has failed in the Senior Courts Costs Office.

Master Leonard built on his ruling last year in Green v SGI Legal, which was also brought by JG Solicitors, the firm that has lit a fire under PI lawyers by challenging deductions from damages.

He said the judgment should be read as if the arguments he considered in Green had been put to him in this case, and rejected for the same reasons.

JG instead put forward two new lines of argument: that it would be appropriate for the court, in the exercise of its inherent jurisdiction over solicitors, to make an order for the delivery of the documents; and that the defendant owed fiduciary duties to the claimant, which should be taken into account when considering whether to exercise that inherent jurisdiction.

Drawing from the Court of Appeal’s 2014 ruling in Assaubayev v Michael Wilson and Partners Ltd, Master Leonard said “the point” of the court’s inherent jurisdiction “is to address cases where the conduct of the solicitor is not what it should be.

“The examples referred to in Assaubayev seem to me to make it quite clear that it is a summary jurisdiction, to be exercised only in clear-cut cases.”

There was a dispute over the level of damages agreed in the case, but the judge found that “the claimant has, since the completion of the retainer in 2014, been in a position to know how much he received by way of damages, and to know how much he paid to the defendant.

“If he cannot now accurately recall the position it would be because he has not kept, or has not checked, any relevant records.”

Dismissing the application, Master Leonard said there was no evidence, “certainly not of the clear-cut kind that would be needed”, of any conduct on the part of a solicitor that might make it appropriate for the court to exercise its inherent jurisdiction.

JG had also failed to identify either a fiduciary duty which obliged a solicitor to supply to a client copies of documents which did not belong to the client, or a breach of any other fiduciary duty.

“Third, it does not seem to me that it would be appropriate to exercise the inherent jurisdiction of the court to order, in effect, pre-action disclosure on the basis that the claimant suspects overcharging by the defendant.”

Master Leonard concluded: “It is important to put this application into context. One must bear in mind the criteria for pre-action disclosure set out by CPR 31.16, which this case does not meet.

“One must also bear in mind the stated purpose of the application, which is to allow the claimant to take advice on the exercise of his statutory right to apply for assessment of the defendant’s bills.

“Those rights are subject to time limits. Given that, on the evidence, the claimant received bills and paid them about three years before he instructed his present solicitors to explore the possibility that he had been overcharged, it seems likely that those time limits expired some years ago.”

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Gloster: we are all going to have to learn new tricks

Mandatory costs budgeting for smaller cases is unlikely to achieve make costs more proportionate in the Commercial Court, according to the judge who initially persuaded Lord Justice Jackson to exclude the court from the process.

Lady Justice Gloster also told judges and lawyers that they need “to learn new tricks” to operate in an electronic court environment.

In a speech organised by Harbour Litigation Funding last month, the transcript of which has just been published, Lady Justice Gloster revealed that as the judge then in charge of the Commercial Court, she was “instrumental” in persuading Sir Rupert Jackson to exclude the court from compulsory costs management.

Noting the “massive support” for this position from the Commercial Court users committee, she explained: “The rationale was that sophisticated parties and litigants in Commercial Court cases were well able to [control], and were already controlling costs by means of budgets for their clients and themselves.

“They were well able to monitor excessive spend by opposing parties both during the case and at the end, and the judge was unlikely to be sufficiently informed about the complexities of the litigation to be able to bring added value to the budgeting exercise.”

That changed as of 22 April this year, when the Commercial Court was brought within the ambit of the costs management regime for cases worth up to £10m.

Gloster LJ asked: “Will it lead in the long run to greater transparency and therefore to more proportionate spends? There has been some criticism of the amount of costs in the Commercial Court and it is clearly critical for the court’s reputation that costs can be justified as proportionate in both large cases and small cases.

“Whether mandatory costs budgeting in the smaller cases will achieve that result, I personally consider doubtful.”

In a speech that looked at how the courts in England and Wales needed to adapt to maintain England and Wales’s “pre-eminent position as a leading global centre of excellence for the resolution of disputes”, Gloster LJ identified the need for judges and lawyers not only to adapt their working practices to new technologies but also “anticipate how commercial disputes are going to be resolved in five to 10 years’ time. And we have to do so quickly to remain competitive”.

She recounted how, as the judge in the Berezovksy v Abramovich case in 2012, she conducted a virtually paperless trial “at least so far as I was concerned”.

“But counsel… at least the more senior ones, appeared unable to relinquish the comfort blanket of hard copy files and the ubiquitous yellow sticker. Vast quantities of ring binders were stacked up like the giants’ gold outside Valhalla in Wagner’s Das Rheingold in serried ranks in the courtroom, and trundled back and forth from chambers every day.”

And in the Court of Appeal, “we would hardly know that the digital revolution had begun”, the judge continued, saying she has never been offered before a case starts access to a digital version of the files – and that when she does ask for the case documents in electronic format, “I am almost always provided with the facility within a day or two, by which time of course the appeal is over and I have marked up my hard copy documents”.

She asked: “So where lies the problem? It lies, I fear, with the judges and the advocates. It is not that judges and advocates are luddites – they are just more comfortable with what they know. But we are all going to have to learn new tricks.

“Parties should in my view be much more aggressive in seeking case management directions that require parties to operate in an electronic court environment, and judges should be much more pro-active in making such orders. Practice directions or new rules may have to be introduced to achieve this end.”

Gloster LJ also complained about the length of pleadings, witness statements, arguments, trials and even (with a “mea culpa”) judgments. “Excessive length – it has to go,” she said, noting that little seems to have changed since the reforms that were instigated in the wake of the BCCI case eight years ago.

One solution was for judges to be “much more proactive” in disposing at an early stage of issues that should not be taken to trial, she said.

The judge also strongly backed the judiciary’s concerns about government plans to charge commercial litigants ‘enhanced’ court fees above cost price. This was an issue “which ultimately is bound to affect the shape of commercial litigation in the years to come”.

While pushing ahead with other changes to court fees after consultation, the Ministry of Justice has yet to announce whether it will take enhanced fees forwards.

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Kaye: deep-seated concerns

The absence of rules, regulations and practice directions with just 10 weeks to go before implementation of the Jackson reforms is “wholly unacceptable” and threatens the tip the civil litigation system into chaos, the president of the London Solicitors Litigation Association (LSLA) has said.

Voicing civil litigators’ “deep-seated concerns about silence from the Ministry of Justice”, Francesca Kaye said she feared that to meet “an artificial deadline we will get piecemeal implementation of rules and regulations, which is the last thing any of us wanted”.

Had the draft rules and regulations been issued for consultation six months ago, “rather than the overwhelming and dark impenetrable silence we have experienced”, practitioners might not feel so concerned about 1 April, she added.

Ms Kaye predicted that the delay in publishing draft rules and regulations, lack of IT and administrative resources in court and lack of time for the judiciary to get up to speed with an increased level of case management was adding up to “a perfect storm where the current crisis would be tipped into chaos”.

She added: “The delay in providing the rules and regulations, and the failure to disclose at an earlier stage the proposed transitional arrangements together with the dangers inherent in such late disclosure, are a matter of immense concern to practitioners.

“In the short term the big bang approach is likely to increase costs to clients, increase risk to both clients and the legal profession, increase satellite litigation, cause delay and uncertainty and, in fact, reduce access to justice. This is not what Lord Justice Jackson intended and is not what the government thought it was doing.”

Ms Kaye continued: “As at today’s date we understand that the rules are in final form and either have or are about to be signed off. The regulations intended to support some aspects of the proposed changes are still not complete. The extension to the RTA portal has already been postponed as a result of the inability to make changes to the portal in time for 1 April 2013. Other areas of the proposed changes have been put back.

“This is a wholly unacceptable way for such significant changes in the civil justice system to be introduced. It adversely impacts on the legal profession as a whole and on the general public whom it was intended to benefit.”

Meanwhile, Litigation Futures understands that while Lord Justice Jackson is now back working full-time following serious illness, the length of his absence and proximity to 1 April mean he will not be resuming his role in implementation of his reforms. Mr Justice Ramsey will continue to take the lead.

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European Court of Justice: amendments to procedure for requests for preliminary rulings

The Civil Procedure Rule Committee has issued the detail of the 66th update to the CPR, which introduces changes in a number of areas. The amendments to the CPR are contained in a statutory instrument and practice direction making document. The changes are outlined below.

The amendments to the CPR come into force on 1 October 2013, but there are amendments to PD3E Costs Management, PD51 (the second Mediation Service pilot scheme), and PD75 Traffic Enforcement which come into force on 1, 29 and 2 September respectively.

There are also the transitional provisions in respect of the establishment of the Intellectual Property Enterprise Court as set out in the statutory instrument.

PD3E Costs management

A revised Precedent H is substituted.

PD19B Group litigation

Minor amendments are made to rules governing group litigation orders, to ensure consistency.

PD21 Children and protected parties

Amendments are made to the monetary level at which damages funds are administered by a deputy appointed by the Court of Protection (COP). Currently if the damages awarded to a protected party are £30,000 or less, the sum may be retained in court and invested in the same way as the fund of a child.

The increase to £50,000 is coupled with a provision that allows district judges and masters to ask the COP to sanction a higher sum to remain in the court's control.

Part 45 and PD45 – Fixed costs

An amendment is made to rule 45.29E Table D, to correct a typographical error. Further amendments are made as a consequence of the reconstitution of the Patents County Court and the amendment of scale costs for proceedings in the Intellectual Property Enterprise Court.

Part 47 Procedure for assessment of costs and default provisions

A modification is made to clarify the amount of costs that may be recovered for matters that do not go beyond provisional assessment of costs, and whether that amount includes court fees and VAT.

PD51 The second Mediation Service pilot scheme

The pilot scheme is extended for a further period up until 31 March 2014.

PD52B Appeals in the county courts and High Court

Amendments are made to correct terminology and to make corrections to the table identifying appeal centres.

PD52C Appeals to the Court of Appeal

Amendments are made to provide for the filing of skeleton arguments, and lodging and filing of other documents related to appeals.

PD52D Statutory appeals and appeals subject to special provision

Amendments are made to allow for appeals against decisions of the Solicitors Disciplinary Tribunal to be made from when the statement of reasons for a decision is given rather than the decision itself.

Part 63 and PD63 Intellectual property

Amendments are made following provisions in the Crime and Courts Act 2013 to reconstitute the Patents County Court as a free-standing specialist list in the Chancery Division, to be called the Intellectual Property Enterprise Court. Amendments to scale costs in the Intellectual Property Enterprise Court are set out in PD45. Consequential amendments are made to PD30 Transfer.

Part 68 and PD68 References to the European Court

Amendments are made to the procedure for requests for preliminary rulings to accommodate changes set out in the Rules of Procedure of the European Court.
Further amendments are made to reflect changes to the EU treaties; the coming into force of the Treaty on European Union and the Treaty on the Functioning of the European Union; changes to the rules and procedures of the European Court; and the European Courts’ updated guidance to national courts.

PD75 Traffic Enforcement

Amendments are made to provide for the civil enforcement of the non-payment of charges arising under road user charging schemes made under part 3 of the Transport Act 2000.

Other amendments

Amendments are made throughout the rules, practice directions and pre-action protocols to update cross references, remove duplication or redundant wording, correct typographical errors and ensure the rules are gender neutral. Amendments are made to: parts 3, 7, 8, 15, 16, 21, 25, 28, 29,31,36, 38, 39, 40, 42, 44,45, 46, 52, 55, 62, 63, 67, RSC O.17, practice directions 2B, 4, 6A, 6B, 7A, 7B, 8A, 8B,10, 15, 16, 18, 19B, 23A, 24, 26, 27, 28, 29, 40B, 42, 46, 47, 51A, 52A, 64A, 67, 69, Pre-action conduct and the Pre-action protocol for low value personal injury (employers’ liability and public liability) claims.


Precedent H is amended.

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Anything Legal, a legal services support business, is implementing the new Compact solution from Eclipse Legal Systems, the sole Law Society Endorsed legal software provider.

Anything Legal provides the legal profession with a comprehensive range of streamlined and cost-effective services, from medico-legal reports and expert witnesses, through to litigation funding and interpreters. Established to increase profitability for those in the legal sector, Anything Legal serves to reduce administration time in securing third party services, and as such has developed an exceptional reputation for delivery.

Prior to implementing Compact, the incumbent software solution at Anything Legal was outdated and unsupported. Due to the continuous growth in new clients, the firm decided to implement Eclipse’s Compact system, an easy-to-use case management suite aimed specifically at boutique businesses.

Rolling out a medico-legal module, Anything Legal will utilise Compact’s built-in workflow to carry out a number of routine steps at the click of a mouse, enabling the firm to benefit from elements of high level automation throughout the entire medical reporting process, and save hours of manual administrative duties.

Further, Compact will transform the firm’s overall efficiency – and as a result increase turnover – by managing all cases with speed, reliability and accuracy, and allowing the team at Anything Legal to concentrate solely on providing the highest quality client service.

Ben Gardner, Director of Anything Legal, comments:

“We’d been researching the market for some time and hadn’t found a system that could effectively manage our caseload volume without requiring bespoke work or excessive costs. Compact suits our needs perfectly, offering a simple-to-use case management system and market-leading toolsets to effectively streamline case progression and enhance client service – and without prohibitive setup costs!”

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inCase200A new version of an award-winning legal app now includes a revolutionary feature designed to further enhance its security, functionality and effectiveness; as well as ensuring greater convenience to adopting firms’ clients.

The latest version of inCase, an app which enables personal injury & conveyancing solicitors to manage communications with clients entirely via their smartphone or tablet, now also provides clients with the means to remotely sign documents, entirely negating the requirement for an on-paper process.

This latest development from inCase, which also automatically stamps the date and time on the document and saves a copy of it to the client’s smartphone once they return it to their solicitor, has never been seen before and is a truly innovative use of technology in the legal sector.

Managing partner of personal injury firm Aequitas Legal and creator of inCase, Sucheet Amin commented:

“One of the challenges with inCase was to find a way to send documents securely to clients’ smartphones, enable them to sign these in their own hand and return them to their solicitor.

“After months of research and development, users of inCase are now able to do just that. We have created a seamless process which is fast, easy and safe for both the firm and client.

“While digital signatures have been around for some time, no function has existed to enable clients to review documents on their mobile devices, and sign their own signature rather than a pre-selected font and send it back to their solicitor.”

Sucheet concluded: “The inCase app now offers a genuine full service communication tool for any law firm. Not only can clients receive and send messages or updates, as well as follow their personal injury claim and house purchase / sale on the unique tracking tool, they can now sign documents on the go. In a fixed fee regime imposed by LASPO, inCase™ really gives firms an edge when it comes to delivering their services both time and cost efficiently.”

Sucheet developed inCase in 2012 in order to improve solicitor and client communications throughout the course of personal injury claims in his firm, Aequitas Legal. Realising the benefits to both his business and clients, Sucheet launched inCase as a fully integrated mobile app for other personal injury firms in October 2013. The Conveyancing version of inCase went live in January 2015 and is already creating interest from a number of national law firms

The app has since achieved far reaching success, with the technology being embraced by several high profile law firms across the UK, and picking up a number of industry accolades. Now entirely compatible with all of the major CMS’ in the UK and recently launched in its third iteration, inCase continues to lead the way in the delivery of legal technology across the post-LASPO personal injury landscape.

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Guest post by Roger Isaacs, forensic accountant and partner at accountancy firm Milsted Langdon

Isaacs: hot-tubbing far more challenging for the expert than facing traditional cross-examination

Isaacs: hot-tubbing far more challenging for the expert than facing traditional cross-examination

Although the courts have had the power to order expert witnesses to give their evidence concurrently since April 2013, there have been very few reported instances of the procedure (colloquially known as ‘hot-tubbing’, or, more formally, witness conferencing) being used other than as part of the initial pilot project that was undertaken in Manchester.

However, I was recently instructed as one of three expert accountancy witnesses in the case of Swain and others v Swain Plc and others [2015] EWHC 660 (Ch).

The case involved four sisters who were shareholders in a company that had been founded by their late father and his business partner. At the date of the trial, the directors of the company were the business partner and one of the four sisters.

The claimants were the remaining three sisters who had no active involvement in the management of the company. They alleged that they had been deprived of the value of their shares by virtue of the actions of their family solicitor and their family accountant. It was these two advisers and their respective professional indemnity insurers who were the defendants, albeit that the family solicitor had died prior to the trial.

The claimants were represented by one expert accountant and each of the defendants’ professional indemnity insurers had instructed their own experts. The issues that the experts were asked to address concerned the valuation of the family company and the shares therein.

One can easily sympathise with any judge who, faced with the prospect of three solid days of expert accountancy evidence, concluded that any alternative short of self-mutilation would be appealing. It is therefore perhaps not entirely surprising that the suggestion of using hot-tubbing in this case had its genesis in a surfeit of accountants.

The fact that the defendants’ experts and their respective counsel were all in favour of adoption of the procedure was perhaps also influential, although it is interesting that the view was not unanimous and the claimant’s expert was vociferously opposed to it.

Nevertheless, directions were given by the judge at the outset of the trial that the experts were to give evidence concurrently.

Experience suggests that determination of this issue early on in proceedings is vitally important, not least because the judge needs time to prepare for a process in which he is required to undertake a proactive role as chair and inquisitor.

For anyone used to the English adversarial approach to justice, it is a wholly alien experience to see a judge engaging in what is a positively Napoleonic and inquisitorial style of interrogation of witnesses.

The procedure for expert conferencing is set out in practice direction 35.11 and in my recent experience, it was faithfully followed to good effect.

Firstly, before the start of the trial, the experts had met and agreed a joint statement that set out the issues on which they agreed and those on which they disagreed. That statement formed the basis of an agenda, focussing on the issues of disagreement, and that was adopted by the judge and formed the basis of the structured discussion that comprised the hot-tubbing itself.

Before the experts could be sworn in, a practical issue arose as to where in court we should physically sit. It was recognised that it would be impractical to squeeze all three accountants into the witness box. Indeed to have done so would have meant there would have been a danger of creating a hot tub that was more than a mere metaphor.

The agreed solution was to have the experts sitting facing the judge at the front of the court in the positions usually occupied by counsel. Counsel moved back a row and sat behind us experts, demonstrating starkly and visibly their subordination to the judge in the hot-tubbing process.

Once everyone had been suitably arranged in their designated places, the questioning could begin. Of course, if the judge is to take on the role of inquisitor, he can no longer rely on counsel to take him to the relevant evidence as happens in traditional cross-examination. Instead the judge must, and in this case certainly had, become familiar with the details of the experts’ respective reports and joint statements.

Taking the issues listed on the agenda one by one, the judge addressed his questions to each expert in turn, often repeating questions put to the first expert to the second and third in a manner vaguely reminiscent of the Blind Date TV show in which contestants famously put “the same question to number two please”.

Having sought the opinion of each expert, each was given an opportunity to comment on or respond to the comments of the others and finally each counsel was asked if he had any further questions before the debate moved on to the next topic.

It soon became apparent that any interrogation by counsel was somewhat redundant on the basis that if the judge had considered a question relevant or significant, he would have already asked it. There was therefore almost a presumption (albeit unstated) that further questioning by counsel should not be necessary. That said, there was no doubt that counsel was afforded every opportunity to ask questions if they wanted to do so.

Giving evidence in the hot tub can be far more challenging for the expert than facing traditional cross-examination. It is often said that one of the advantages of being an expert witness is that one inevitably knows more about one’s field of expertise than the barrister who is posing the questions. In some cases experts can therefore obfuscate in a manner that can sometimes be difficult to challenge efficiently.

By contrast, in the hot tub there are other experts from the same discipline who can immediately challenge anything that is said with which they do not agree. This creates an immediacy that is conspicuously absent in traditional cross-examination in which, if an opposing view is to be expressed by another expert, it may not be heard until several hours or days later.

One of the aspects of traditional cross-examination that is highlighted by hot-tubbing is the fact that counsel has to anticipate which issues are likely to be relevant to the judge and inevitably time will be spent dealing with matters on which the judge has either already been persuaded or which he considers irrelevant.

By contrast, allowing the judge to be the primary inquisitor means that he can cut to the chase. The effect is dramatic in terms of timing and in the recent trial, three planned days of traditional cross-examination were condensed to just three hours of hot-tubbing.

This exceptional speed puts further pressure on experts who have far less thinking time in the hot tub than they would have if they were to face traditional cross-examination. Specifically, in traditional cross-examination an expert will be taken to the relevant sections of his or her report as a precursor of being asked a question. One of the reasons for this is that it is a means by which the judge can be directed towards the relevant evidence.

This becomes unnecessary in the hot tub and questions are asked with no preamble on the assumption that all concerned – inquisitorial judge, expert and counsel – will all be familiar with the issues and the underlying evidence from the outset.

Happily, by the time of the trial there had been a narrowing of the number of accountancy issues that were in contention. Key amongst these was the value of the company in relation to which opinions differed widely. Although it had a turnover of only £7m, the three accountancy experts had arrived at starkly different valuations ranging from £2.2m to £5.1m.

I concluded that a valuation in between these two extremes of £3m was appropriate and was therefore pleased that ultimately the judge concluded that the company was worth £2.96m.

Roger Isaacs is the vice-chair of the forensic group of the Institute of Chartered Accountants in England and Wales, and national technical director of the Network of Independent Forensic Accountants

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Let's be generous about the MoJ decision

Posted by Neil Rose, Editor, Litigation Futures

It’s nice to get things right sometimes. In this column last week, under the headline 'Is the government backtracking on whiplash reform?', I suggested that the tide had turned against a rise in the small claims limit for whiplash claims following the report of the transport select committee. Seven days later the Ministry of Justice (MoJ) has been good enough to confirm that this was indeed the case and that the limit will not go up.

That it remains under review and could yet happen perhaps means that the idea isn’t quite in the long grass, but it’s certainly in the tufty stuff and will be pretty hard to find – this side of the election at least, I would think.

You wouldn’t necessarily know it though. The MoJ sent out an embargoed press release yesterday that studiously failed to mention anything about the small claims limit, preferring to trumpet instead the new independent medical panels that will supposedly stamp out “whiplash cheats”. It was only when asked directly that the MoJ coughed up the information.

Writing this before today’s papers are published, I therefore expect that many of them will have missed the change of heart entirely. The detail of the consultation response was not released until today, and journalists have already moved onto the next story.

It is all too easy for me and other journalists to cast as a U-turn any decision by the government not to pursue proposals it had seemed set on (we saw this recently with legal aid). But let’s be less cynical for a moment and instead say that the process of consultation worked. The government was convinced by the responses it received that this was a reform too far for a market that has already seen huge change this year.

Perhaps it also understood that the evidence behind the call for a change in the limit was anecdotal at best – the Association of British Insurers (ABI) was simply unable to nail the scale of fraud. The figures that did exist in no way justified such a radical response. And that individuals having to go up against represented insurers in the small claims court was not very fair.

Nonetheless, attacking the so-called compensation culture scores easy political points and the MoJ could have gone ahead with raising the limit without much of an outcry outside of the legal profession. There was no political capital in changing its mind; rather it would be attacked for doing a U-turn and not being as tough as their rhetoric suggests. So claimant lawyers find themselves in the unaccustomed position of congratulating justice secretary Chris Grayling for listening. That’s what consultations are for; it’s just nobody expected it.

The ABI, meanwhile, will be wondering why its winning streak has suddenly come to an end.

So we’ll even let Mr Grayling get away with claiming full credit for the fall in insurance premiums this year, when there must surely be other factors at play as well.

Claimant lawyers will just be mightily relieved. Leaving last night’s Law Society Excellence Awards (as ever, a very good event), I bumped into a very well-known PI lawyer and shared the news with him. He couldn’t have been happier. “So we’re just facing a [expletive deleted] storm, not a [same expletive deleted again] tsunami,” he grinned.

Yes, claimant lawyers have won this battle, but perhaps the war was already won by defendants. Still, you take what you can and one less punch to the head is always going to be welcome.

And feel free to tweet me pictures of your firm’s FD doing cartwheels in the office.

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Whiplash: claimants should have choice of experts

The Civil Justice Council (CJC) has called for controls on links between claimant solicitors and medical reporting organisations (MROs) and experts to be extended beyond situations where there is a financial connection.

In a largely positive response to the Ministry of Justice’s latest consultation on whiplash reform, the CJC also said claimants should be given a small choice of medical expert, rather than have one allocated to them through the proposed MedCo portal.

The CJC said it continued to endorse the government’s “overall objective of developing a more streamlined procedure for soft tissue injury claims – and one which is both transparent and proportionate”.

The government plans to sever the financial links between MROs, solicitors and claims management companies, which the CJC agreed is of “fundamental importance” to the reforms. The response said the CJC had a particular interest in how this will be defined and policed.

“Any breaches should be a matter for the professional regulators, such as the Solicitors Regulation Authority,” it emphasised.

It said the efforts to address this should not be limited to financial links. “It would be equally undesirable for a selected MRO to be run by a member of the solicitor’s family, for example, even if no financial benefit ensued.”

The CJC added: “This is a complicated field in which the nature of the different possible business relationships – both direct and indirect – are varied and complex with links often not only with the commissioning party or intermediary but also with the subsequent treatment providers, eg a physiotherapy company or CBT provider.”

The council’s view was that the claimant should have a choice between directly instructing an individual expert and using an MRO, and that this choice should be one of the criteria selected by the claimant or their lawyer when using the new system.

“As the government will be aware, many firms simply would not consider it viable to pursue a claim if it involved the extensive liaison and administration made necessary by the exchange of medical records and most now operate by using medical agencies.”

The CJC recommended that claimants should be given a “small random selection of say three experts with sufficient background information to enable a choice to be made, rather than one individual”.

Also in its response, the council said that if a claimant solicitor fails to conduct the proposed ‘previous claims’ data search on their client, the defendant should be able to decline the claim notification form and require the claimant to resubmit the claim as though never presented, “rather than simply allowing the claim to drop out of the portal with the consequent risk of higher costs”.

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Houghton: Bespoke budget

The High Court has criticised a law firm’s “very heavy reliance on partner time”, and the “astonishing” amount of time junior counsel was planning to spend in preparing for trial, as it slashed by more than half many of their budgeted costs for representing two claimants in the phone hacking litigation against Mirror Group Newspapers.

Chief Master Marsh said many features of the second wave of the litigation were different from the standards costs regime and similar to a group litigation order, but it did not operate in a “wholly parallel universe”.

The cases of former TV presenter John Leslie and former Celebrity Big Brother contestant Chantelle Houghton are the first in the second wave.

Though the phone hacking litigation uses a novel system of template cost budgeting to avoid having to create one from scratch each time, it was agreed that these two cases should have bespoke individual budgets.

Mr Leslie’s proposed budget was for £1.25m, Ms Houghton’s for £723,000, both figures significantly higher than the template budgets provided.

The master said he struggled with applying the principle of proportionality. “It seems to me that the only principled way of applying the test in these cases is to have only very limited regard to the possibility that proportionality may produce a cap that will limit what would otherwise be a reasonable figure.

“This is what the parties have done in their submissions. To take any other approach in this bespoke litigation risks the court merely applying arbitrary limits because there is no financial reference point for proportionality.

“It seems to me that the wider factors I have summarised, in particular the public importance and test case factors, will have the effect that if the costs are reasonable they are proportionate.”

Going on to each budget phase, the master described the hours included for witness statements as “grossly excessive and well above what is within a range of reasonable costs”.

He went on: “The amount of the time that has been budgeted suggests strongly that the statements will have only a passing connection with the direct recollection of the witnesses. They will have become an artificial construct of the lawyers.”

Chief Master Marsh cut the amount allowed for Mr Leslie’s witness statements from £99,000 to £60,000. Ms Houghton’s budget was cut from £85,000 to £50,000.

On disclosure, he said: “Mr Leslie’s budget shows very heavy reliance on partner time.

“This is not justified and the majority of the time reasonably spent on disclosure should be charged at the associate and paralegal rates.”

Mr Leslie’s budget for disclosure was cut from £98,000 to £75,000. Ms Houghton’s had already been agreed at £56,000.

The master described the costs budget figures of £150,000 and £139,000 for trial preparation as “very large sums indeed”.

He went on: “Mr Leslie’s budget is made up of 195 hours of partner time, 160 hours of associate time and 50 hours of time spent by a trainee. In Ms Houghton’s budget, the equivalent figures are 150 hours, 180 hours and 50 hours.

“They total in each case 405 hours and 380 hours. I am satisfied that these amounts of time are a completely artificial budgeting construct and not a genuine estimate of time that will be spent on the limited tasks that fall within this phase.”

The master slashed the figure for Mr Leslie by more than 50% to £70,000, and for Ms Houghton by almost 50% to the same amount.

On the trial itself, he renewed his criticism of excessive reliance on partner time.

“Both budgets provide for a partner and an associate/assistant to be present in court each day and allow 10 hours for each day. In addition, provision is made for 20 hours of paralegal/trainee time.

“The budgets total £110,400 for Mr Leslie’s solicitors and £113,450 for Ms Houghton’s. I accept that two fee-earners need to be involved but I do not accept that is necessary for a partner and an associate to be involved for the whole trial period.

“A more reasonable and proportionate combination is a partner, or an associate, to attend with a junior fee-earner, although it is reasonable for the partner to be present at key moments.

“It is also unnecessary for the representatives for both claimants to be in court for the entire trial.”

The costs budgets for the trial were reduced to £50,000 for each claimant.

Chief Master Marsh was equally scathing about the costs estimates for David Sherborne, the claimants’ “very experienced” junior counsel.

He said the figure of £330,000 for Mr Sherborne for the 15-day trial, and £107,000 for Julian Santos, the ‘junior’ for the trial, were “far in excess of what is within a range of reasonable costs”.

He added: “Mr Sherborne’s brief fee, broken down using an hourly rate of £400 per hour, involves him charging for an astonishing 625 hours of work in preparation for a 15 day trial.

“Allowing for a 10 hour day this amounts to 62 days of work (52 days if he were to charge for 12 hour days). It is difficult to conceive these are genuine periods.”

Cutting the brief fees down to £190,000 and £75,000 respectively, he commented: “It is not in dispute that these are ‘two counsel’ claims. However, Mr Sherborne has not taken silk and there is

NOTE: This article initially named Atkins Thomson as acting for the claimants. In fact, it was acting on behalf of the group in relation to other costs issues. Hamlins is acting for Chantelle Houghton and Taylor Hampton for John Leslie.

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Gallagher: getting under the skin of courts and tribunals

Gallagher: getting under the skin of courts and tribunals

The civil courts need to learn from the ombudsman model, “whereby huge numbers of relatively low value or low stakes cases are resolved simply, quickly and cheaply by avoiding hearings all together”, according to the civil servant in charge of digitising the courts.

Kevin Gallagher, digital director at HM Courts & Tribunals Service, said that, for example, “for a dispute between neighbours about the height of a leylandii tree, iPhone evidence and a video hearing may prove far more effective than the parties appearing in a court miles from the site in question.

It must also be “as straightforward to claim uncontested probate as it is to submit a tax return or renew your annual car tax”.

Speaking at a modernising justice conference in London, Mr Gallagher said that “to develop services for users and for technology to effectively improve how the courts and tribunals service operates, we will not be recreating our current processes online”.

He explained: “The opportunities for digital services cannot be hampered by decades-old processes. Instead, we are getting under the skin of how our courts and tribunals operate and putting user needs at the heart of it all.”

The problem, he said, was that the courts have continued to look and feel the same while change has been happening in so many other areas: “The only place you are likely to see a VHS recorder is in one of our courtrooms.”

Mr Gallagher continued: “As a justice system, we need to reach the point where it is expected that a police officer will give evidence by video, taking 10 minutes rather than half of their working day.

“We need to stop using prison vans to transport prisoners to and from the courts for short plea hearings which could be done online. And we need to, as Sir Brian Leveson recommended in his review, limit what happens in the criminal court room to just trials and complex sentencing.”

A key component of the changes would be to develop a system that took procedures out of court that did not need to be there, he said, such as:

  • Helping divorces to be agreed and progressed online; as well as allowing financial issues and child arrangements to be settled through online mediation rather than in the courtroom;
  • Taking non summary offences such as traffic or fare evasion out of the court room to be dealt with through automated processes; and
  • Supporting the work of tribunals by making it much easier to submit applications and evidence online and share with all parties.

Mr Gallagher said the new online plea functionality for traffic offences has increased the number of pleas made and in turn reduced the number of non-pleas and court sessions held ‘in absence’.

Further, paperless working was becoming a reality in the criminal courts, with more than six million pages of evidence now stored on the Digital Case System, while the eJudiciary system gave all magistrates and judges instant access to key services and information relevant to their role and region.

Digitising the civil, family and tribunal jurisdictions to follow the criminal courts was the next step, he said, while also highlighting four projects where technology was a key enabler.

“The probate service will see the introduction of online applications supporting a structured approach, removing ambiguity, handling payments, providing online case tracking and automated management where possible and appropriate.

“We will also, dramatically improve the efficiency of uncontested divorces, removing unnecessary delays at what can be a difficult time.

“Social security and child support appeals will be supported through the introduction of an online service for tribunal users to start and progress a case, and for judges to use digital case information to decide the case online or in a hearing. And through effective working with the Department of Work and Pensions, we will be able to eradicate the need to post bundles of paper passed between departments.

“And the online court project has considerable potential for moving lower value civil claims out of the courtroom to be progressed more quickly, and at lower cost.”

Mr Gallagher said they had learned from past government IT project problems. “Gone are the days of single, large scale, beginning-to-end government IT projects handed to multinational IT consultancies. HMCTS is creating its own capability to develop, build and continually improve,” he said.

“Of course we will continue to work with third parties to bring skills, expertise and technology, but we will retain control. This will allow us to work in an agile manner, evolving and improving, delivering and supporting services based on user experience and business need, without being inhibited by expensive, inflexible contracts.”

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Press: cost-free arbitral process

The government needs to introduce qualified one-way costs-shifting (QOCS) for media litigation if the proposed new press regulator does not set up an arbitral alternative to the courts, Lord Justice Leveson recommended today.

He said that without this, the end of recoverability will put access to justice – particularly in privacy cases – “in real jeopardy, turning the clock back to the time when, in reality, only the very wealthy could pursue claims such as these”.

This was despite the 10% increase in general damages, because the low level of awards for breach of privacy means it will have little effect. Further, while defamation claims are in large part about neutralising the slander or libel in public, in privacy claims the damage has been done.

“A modest increase in damages (themselves usually modest) will provide little encouragement to a claimant otherwise anxious to seek what might be entirely justifiable redress,” the judge said.

A new press regulatory body is at the heart of Leveson LJ’s recommendations, and he said it should set up an arbitral process through which people could bring civil claims against publishers at no cost to themselves.

Noting that the government has decided not to implement Lord Justice Jackson’s recommendation that QOCS be extended to media cases, he said that if an arbitral process is not created, “I have no doubt that the requirements of access to justice for all should prevail and that the proposals of Jackson LJ should be accepted” for defamation, privacy, breach of confidence and similar media-related litigation.

In the event the arbitral process is created, Leveson LJ said the costs system should be used to discourage either claimant or defendant from going to court instead, suggesting sanctions inspired by the Halsey ruling on failure to mediate. This would mean it would be “strongly arguable” that a claimant who failed to use the system would be deprived of any costs, even if successful.

He went further in the case of defendant publishers to say that not only could they be deprived of costs, but they could also be ordered to meet the costs of the unsuccessful claimant.

Leveson LJ acknowledged that recoverability drove the press to settle cases because “the cost of losing was entirely out of proportion to the issue at stake”, but said that ending it without QOCS will mean “the economics of litigation move against those who would otherwise challenge the press in favour of the press”.

More generally the judge called for the Civil Justice Council review the damages available in media litigation, and said exemplary damages should be available as well.



A golden opportunity for the ATE market to innovate

Enrique Gomez Head of ATE DAS UK Group

With the key judgement in the BNM v MGN case not expected until the end of the year, and decisions in the fixed recoverable costs arena not due until 2019, the after-the-event (ATE) insurance sector – already burdened by ever-changing regulation – is playing something of a waiting game. But this could be a golden opportunity for the ATE sector – the chance to take advantage of what might otherwise be a relative lull in activity period to set in motion a time of self-analysis and transformation, to develop plans for what the future of ATE insurance will look like.

July 16th, 2018