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High Court: parties are not co-operating effectively

High Court: parties are not co-operating effectively

A High Court judge has criticised the conduct of the parties and solicitors on both sides of a personal injury dispute for engaging in the type of “attritional warfare” that has been dying out.

Mr Justice Edis said that “sensibly co-operating” parties could have settled the issues in front of him.

In Hayden v Maidstone & Tunbridge Wells NHS Trust [2016] EWHC 1962 (QB), the judge was dealing with two applications that flowed from a decision by Mr Justice Foskett in May to allow the very late submission of covert video surveillance evidence by the defendant that questioned the extent of the claimant’s ongoing injuries.

The claimant was a cardiac physiologist who, in 2007, suffered a back injury when attempting to help in the transfer of a patient from a trolley on to a cardiac investigation table. East Sussex firm Dawson Hart is acting for the claimant, and BLM in Leeds for the defendant.

Edis J said: “Both applications are hotly disputed, as is the way of this litigation at least in the recent past. It appears to me that this is a case where the parties are not co-operating effectively. Foskett J was rightly critical of the conduct of the defendant’s solicitors in his judgment [for the late submission of the evidence] and underlined the need for proper professional cooperation.”

He said on this occasion “the lack of co-operation is at least shared and that a large slice of the fault lies on the claimant for taking wholly unmeritorious points and making unfounded allegations of bad faith against the defendant’s lawyers.

“I express the hope that in the final pre-trial preparation the parties are able to agree what can be agreed in the usual way. The trial judge may be able to deal with any failures in this regard by appropriate costs orders.

“I regret to say that a great deal of time and money has been spent by solicitors on both sides attacking the conduct of the opposing party in witness statements which simply generates yet further statements in response.

“It appears to me that the case has been bogged down in attritional warfare of a kind which used to be far more common than it is now. The issues before me were all capable of resolution by agreement by parties sensibly co-operating towards a trial. This is especially so since a detailed order for directions has been recently made by Foskett J after another long and contentious hearing.”




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Jersey: CISE said Argentum is no longer suitable for listing

Third-party litigation funder Argentum Capital was delisted by the Channel Islands Securities Exchange (CISE) this week.

Argentum – whose non-executive chairman is former Court of Appeal judge Sir David Keene – has gained a high profile in recent months due to its backing of the Stewarts Law action brought by institutional shareholders against RBS over its 2008 rights issue.

The CISE said it had cancelled the Jersey-based company’s listing “on the basis that the Exchange considers that the company is no longer suitable for listing under chapter 7 of the Listing Rules”.

Chapter 7 deals with the listing of investment funds, but a spokeswoman for the CISX declined to give any more detailed reason for its decision.

However, a statement on the Argentum Group’s website said: “As advised by the CISE to the company, the reason for the cancellation of listing was that the company was not in compliance with those provisions of the rules requiring there to be an adequate market in the company’s securities.

“The specific rule relied upon by the CISE was rule 7.3.1.4.1, which requires at least 25% of an investment fund’s securities ‘be in the hands of the public in such proportions so as to satisfy the Exchange that there will be an adequate market in the securities’. The company makes this announcement to clarify the basis of the CISE’s action.”

The news came the week after a US-based website called OffshoreAlert made serious allegations about the activities of Centaur Litigation SPC, an investor in Argentum.

Argentum has released a separate statement in response to the story and any implication that the group “is in some way involved in the matters alleged”.

It said: “The Argentum Group denies any knowledge of or involvement in the matters alleged. Centaur Litigation Limited is an investor in Argentum Capital Limited and an investor in certain third-party litigation claims managed by Argentum Investment Management Limited.

“Argentum Investment Management Limited is not and was never the global investment manager for Centaur Litigation Limited or Centaur Litigation SPC. No member of the Argentum Group is or was in any way involved in the fundraising activities of Centaur or its dealings with its investors.

“Full details of the Argentum Group’s structure, activities and financial position and the terms and nature of Centaur’s investment in Argentum Capital Limited are set out on the group’s website and in the offering memorandum and audited accounts that are available there.”

Argentum is a member of the Association of Litigation Funders (ALF). In a statement, it said: “The board of the ALF has been concerned to read press reports alleging irregularities in fundraising activities at Centaur Litigation SPC. Centaur is a major investor in Argentum Capital Limited (ACL). ACL is a funder member of the ALF; Centaur is not.

“The ALF was also concerned to learn that the listing of ACL shares on the Channel Islands Securities Exchange Authority was cancelled on 24 February 2014 on the basis that the Exchange considers that ACL is no longer suitable for listing under Chapter 7 of the Listing Rules.

“The ALF has been in urgent contact with ACL since the press reports first appeared seeking to understand the implications of these developments and those contacts are continuing. No complaint has been received by the ALF from any of ACL’s funded counterparties. No further comment will be made by the ALF at this stage.”

Centaur owner Brendan Terrill told this website that he had no comment except that the matter was with his lawyers.

Clive Zietman, head of commercial litigation at Stewarts Law, said the firm was aware of the issue but had no comment.




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High Court: Privilege extends to documents that ‘evidence’ legal advice

The High Court has ruled that a set of litigation funding documents were protected by privilege because they inferred the substantive legal advice that had been given in the underlying dispute.

Mr Justice Morgan rejected the submission that “the possibility that one could infer the substance of a party’s legal advice from a document did not suffice to make that document privileged”.

He also said that it was “not part of our law as to disclosure that every conceivable stone must be turned over”.

The arguments arose during unfair prejudice proceedings brought pursuant to section 994 of the Companies Act 2006 and concerning leading hotel company Edwardian Group.

The petitioners own approximately 20% of the shares in the company and want to be bought out. One of the acts of unfair prejudice they allege is the removal of one of the petitioners as a director in July 2009.

However, the petition was presented more than six years later, and the first respondent argued that, because of this, the petitioners should not be granted any relief.

One of the reasons the petitioners gave for the delay was that they spent five years “actively but unsuccessfully” seeking funding to commence the litigation.

The respondent wanted to see proof of this but the petitioners either did not provide the relevant document or heavily redacted them on disclosure, arguing that they revealed “directly or indirectly the nature, content or effect of privileged communications”.

Morgan J said it was clear that this head of privilege was not confined to communications between lawyers and clients, but extended to other material which “evidences” the substance of the communications.

The test to apply, he concluded, was laid down in the 1884 case of Lyell v Kennedy, restated by the then Lord Justice Bingham in Ventouris v Mountain in 1991.

Bingham LJ said: “The ratio of the decision is, I think, that where the selection of documents which a solicitor has copied or assembled betrays the trend of the advice which he is giving the client the documents are privileged.

“[Counsel] for the plaintiff put this forward as an exception to what he claimed was the general rule, that non-privileged documents do not acquire privilege simply by being copied. If the ratio I have given is correct, the authority is consistent with the fundamental principle underlying the privilege.”

Morgan J said he could also “derive assistance” from Australian cases, which drew a distinction “between a case where there is a definite and reasonable foundation in the contents of the document for the suggested inference as to the substance of the legal advice given and merely something which would allow one to wonder or speculate whether legal advice had been obtained and as to the substance of that advice”.

Applying this to the facts, Morgan J – who had not seen the documents – said the description of the documents provided by the petitioners’ solicitor “would satisfy the test set in Lyell as to giving a clue as to the legal advice given and the test in Ventouris v Mountain as to betraying the trend of the legal advice”.

He added: “I also consider that [the] description of the basis of the claim is on the right side of the line between documents from which a party’s legal advice can be inferred and documents which allow one to wonder or speculate as to whether legal advice had been given and as to its possible substance.”

Thus he rejected the application for an order.

He also rejected an application relating to the disclosure of documents from the petitioners’ former solicitors, Magwells.

Morgan J said: “The information before me as to the Magwells Documents does not allow me to form a clear view on many of the large number of disputed matters of fact.

“Overall, I think it is likely that disclosure of all of the Magwells Documents would result in massive duplication of documents which have already been disclosed by one or other of the parties and that any new documents which might be disclosed would be few in number.”

Morgan J added: “I recognise that this means that in relation to disclosure there may be a stone which has been left unturned. However, it is not part of our law as to disclosure that every conceivable stone must be turned over.”

Morgan J said he was “not persuaded” that the petitioner’s solicitor had “not properly applied the test for privilege” when making the redactions, “although it is possible that he has not done so”.

He went on: “Therefore, I am not ‘reasonably certain’ that the claim to privilege has not been properly made.

“In addition, I consider that if it appeared that [the solicitor] had not correctly carried out the redaction exercise first time around, the court might not (on the ground of proportionality) require him to carry it out a second time.

“The advantage to the respondents of the redaction exercise being reviewed and redone is likely to be slight. Further, the time between now and the trial in January 2018 is limited and it would be very undesirable to lose the trial date to allow time for a second redaction exercise to be carried out.”




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Eclipse200Sheffield practice, SSB Law, offers a wide range of services from family law and probate to personal injury and employment law.

Founded in 2007, the firm prides itself on its reputation for providing accessible legal services to suit any circumstance. SSB Law is unrelenting in its focus on client relationships, ensuring its team of handpicked staff is entirely focused on client success.

SSB Law required a scalable Case Management System, flexible enough to meet the firm’s requirements as it developed and grew over time. From previous research, the practice knew Proclaim possessed an exceptional level of versatility and provided a great open platform.

SSB Law implemented the Proclaim Case Management System to provide fee earners with a user-friendly, centralised desktop application.

Furthermore, the practice opted for Eclipse’s New Business Enquiries module to manage ongoing relationships with potential clients, and analyse marketing strategies. As part of the drive to further enhance this, SSB Law also implemented Proclaim’s DotMailer connector, allowing for targeted and relevant email marketing campaigns.

Since implementing Proclaim, SSB Law has greatly enhanced its marketing efforts, and in turn its relationships with current and potential clients.

The NBE module has enabled staff to monitor and maximise conversion rates – from initial contact with a client through to instruction.

Taking this further, Proclaim’s DotMailer integration has enabled the firm to automatically upload all new enquiries to specific address books, ensuring all potential clients receive personalised and attractive email communications.

Proclaim’s inbuilt reporting toolset means the practice can seamlessly identify particular client details and directly upload them to DotMailer, creating an efficient and accurate mailing list with minimal human intervention.




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Fenn: reward for admission of liability too high

The fixed-costs regime for personal injury work risks encouraging undersettlement by claimant solicitors and admissions of liability by defendants when they might otherwise fight, the academic who studied the RTA portal for the government has warned.

Paul Fenn, professor of insurance studies at Nottingham University Business School, said there needed to be “incentives for good behaviour” built into the system.

Last summer the Ministry of Justice published a report commissioned from Professor Fenn into the first year’s operation of the portal. He concluded that a further review was needed after more experience of the portal before an extension was contemplated, that fixed costs should be proportional to damages and there needed to be an integrated approach to fixed costs within and outside the portal.

Speaking in London yesterday, Professor Fenn said the government had “completely ignored” the first of these recommendations, and had chosen not to make fixed costs proportional to damages for reasons of simplicity. However, this takes away the incentive for solicitors to act in the best interests of their clients, he argued, and risks reducing damages because lawyers are better off settling quickly where liability is not disputed.

He pointed to the fixed-costs regime in Germany, which is “highly proportional” – while solicitors here are paid £500 for all portal cases worth between £1,000 and £10,000, in Germany there is a sliding scale ranging from £180 to £1,125.

Professor Fenn told the Westminster Legal Policy Forum seminar that while the disparity between fixed costs inside and outside the portal previously encouraged defendants to fight, because they were often better off financially leaving the portal, the situation has now gone the other way and the “reward for an admission of liability is now too high”.

He added: “If we’re going to move to a no-fault system, we should do so explicitly rather than by accident… Fault is an essential part of the system to drive behaviour.” Without it, he said, “we could have a much cheaper system”.

Speakers also expressed surprise that the government had no programme in place to monitor and assess the impact of the civil justice reforms.

Meanwhile, James Dalton, assistant director and head of motor and liability at the Association of British Insurers, revealed that it is looking to strengthen its code of conduct on third-party assistance and added that next on the association’s agenda is a predictable damages framework – which would be “independent, transparent and under independent control”. This would help people handling their own case before the small claims court if the government raises the current £1,000 limit.

Also at the seminar, the judge in charge of Jackson implementation, Mr Justice Ramsey, said “fundamental dishonesty” – so as to lose the protection of qualified one-way costs shifting – was not likely to mean a claimant who exaggerates one element of their claim. It is aimed at the kind of case where a claimant is secretly filmed playing football when they are supposedly unable to move freely.

Rod Evans, president of the Forum of Insurance Lawyers, said that something is either a lie or it’s not – “the ‘judicial grey’ on exaggeration seems to me to be a trap that needn’t be laid,” he said.




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Insurance Services Office (ISO), a leading provider of personal injury claims solutions, has announced that insurethebox, the UK’s leading provider of telematics car insurance, has selected ISO Claims Outcome Advisor (COATM) and the ISO MoJ solution to help manage its motor personal injury (PI) claims. The level of data provided by ISO’s management information system combined with the data collected from insurethebox’s Clear Box telematics device helps claims handlers gain valuable insight into each individual claim, allowing insurethebox to maximise the efficiency of its claims-handling operations.

Before the ISO implementation, insurethebox claims handlers dealt with motor PI claims by hand, putting heavy reliance on administrative staff to manually check the claims portal each day for settlement packs. COA helps claims handlers manage the complex medical, legal, and occupational issues presented by personal injury claims and helps ensure appropriate financial arrangements are agreed to and implemented. insurethebox now handles all interactions through ISO Claims Outcome Advisor, requiring less manual effort and increasing the speed and efficiency of settlements.

Brian Pearse, head of Claims Development at insurethebox, commented, “At insurethebox, we pride ourselves on the quality of our claims handling. ISO’s COA solution will help bring additional speed and transparency to the entire process.”

“Another significant element of the decision was the speed of implementation. Having had fantastic support and training from ISO, we were able to maximise our investment in COA from the word go,” continued Pearse.

ISO’s COA personal injury claims tool provides an application-to-application interface with the MoJ A2A system. It retains a complete, easily accessible record of all MoJ activity in the COA interactive management information dashboard and intelligently populates all live claims.

Joe Pendle, managing director, ISO, said, “At a time when companies are looking to optimise their investments in new technology and adhere to the MoJ timescales for motor PI claims, we’re finding the recurring fundamentals to be speed of implementation, increased visibility, and consistency. With COA, claims handlers have the ability to retain consistency and efficiency, and insurethebox’s implementation means that as they continue to grow, they will remain consistent in their handling of PI claims.”




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Liverpool: Judge was wrong in law

A circuit judge wrongly exercised his discretion in refusing to order a hearing on whether a claim was fundamentally dishonest, the High Court has ruled.

Mrs Justice Yip ruled that it was “reasonable” to give the defendant insurer, Alpha, the chance to put its case.

The claim for minor whiplash injuries by a woman and her 13-year-old son followed a road traffic accident in a car park. The defendant’s insureds admitted negligence but maintained that the boy was not in fact in the car.

The claim was discontinued without reason on the day before trial. His Honour Judge Gregory in Liverpool then refused the defendant’s application to issue a direction that the question of fundamental dishonesty be determined.

He said it would be a “disproportionate use of limited and precious court resources” in the circumstances.

He continued: “There is nothing, in my judgment, which suggests that there is any particular exceptional quality about this particular case that should cause me to give further directions and to set aside further court time to allow this particular isolated issue of dishonesty to be ventilated.”

On appeal, Yip J said the judge was wrong in law to subject the application to an exceptionality test.

Practice direction 44, paragraph 12.4(c) – which deals with discontinued claims – makes no reference to the need for exceptional circumstances, unlike paragraph 12.4(b), which refers to settled claims.

Sitting in Liverpool, Yip J said: “The correct approach is to regard the discretion under CPR 44PD 12.4(c) as an unfettered one, requiring the weighing of all relevant considerations in accordance with the overriding objective.”

Exercising the discretion afresh, she ruled that the defendant insurer’s evidence raised a triable issue. “I do not regard the defendant’s case as being particularly strong, but it was nevertheless based upon evidence that was capable of being accepted.”

She added that the two factors that weighed “heavily” in the balance were the very late stage at which the claim was discontinued and the complete absence of an explanation from the claimants.

“I accept that there may be many reasons why a claimant will discontinue. However, where liability is not disputed save for the allegation of fundamental dishonesty and where the matter is close to trial, I believe some explanation can reasonably be expected…

“I bear in mind that the defendant has incurred costs in defending this claim to trial and has done so because it believes that a false claim has been made.

“The defendant seeks to enforce recovery of its costs by disapplying the QOCS regime. In the absence of any explanation, it is understandable that the defendant would feel that the late discontinuance was an attempt to avoid that consequence and would feel aggrieved at being deprived of the opportunity to establish fundamental dishonesty and so recover costs.

“On balance, looking at all the circumstances of this case, I consider that it is reasonable for the defendant to be given the opportunity to put forward its evidence and to test the claimants’ evidence on the issue of fundamental dishonesty.”

Yip J also noted that, in considering proportionality about holding such a hearing, “it does need to be recognised that there is a public interest in identifying false claims and in claimants who pursue such claims being required to meet the costs of the litigation”.




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Court of Appeal: what’s sauce for the goose is sauce for the gander

Judges should be “very slow to entertain a discussion as to whether parties to litigation have negotiated in a reasonable manner”, the Court of Appeal has cautioned.

Lord Justice Tomlinson said “such an enquiry opens up the prospect of undesirable and wasteful satellite litigation, as the reasonableness of a negotiating stance may and almost certainly usually will depend upon a careful evaluation of the respective states of knowledge of the parties”.

He added: “The part 36 regime is designed precisely to obviate this kind of enquiry.”

The court was ruling on an appeal against an order for indemnity costs that followed a successful birth injury claim in Manna v Central Manchester University Hospitals NHS Foundation Trust [2017] EWCA Civ 12.

Mrs Justice Cox ordered that the defendant should pay indemnity costs from 11 June 2015 – four days before the trial – which was the day the trust rejected the claimant’s pre-trial offer of settlement.

She gave two reasons for this. First, she said the defendant had failed “to enter into meaningful negotiations in a collaborative way and to seek a sensible compromise in a quantum only trial” in a manner which “was unreasonable, especially in light of the self-evident weaknesses in their care and occupational therapy evidence”.

She also castigated the defendant’s decision to carry on to trial as “ill-judged”, necessitating an eight-day trial “at huge cost both to public funds and to the family of this severely disabled young claimant”.

The second reason was that the judge regarded the nature of the case advanced by the defendant as unsustainable and entirely inappropriate in the context of the case.

Tomlinson LJ went through the history of settlement negotiations. The defendant’s offer, made 21 days before the trial and rejected by the claimant, would have involved payment of a further lump sum of £1.25m and periodical payments of £80,000 per annum.

A week before trial, the claimant made its offer, which was not part 36 compliant, involving payment of a further lump sum of £1.65m and periodical payments of £90,000 per annum. That offer was rejected by the Defendant on 11 June 2015.

The end result at trial was that the claimant recovered a further lump sum payment of £1.75m and periodical payments of £103,000 per annum.

Tomlinson LJ said: “For my part I do not think that the defendant’s conduct in negotiations should attract any sanction in costs, and I do not consider that the judge gave adequate reasons for her conclusion that it did.”

However, rejecting the appeal, he agreed with the trial judge over the defendant’s conduct of the trial, with the claimant’s parents accused of exaggerating the difficulties involved in his care and that they were motivated by greed rather than the interests of their son.

The judge was also “very critical” of the evidence given by the defendant’s experts in the field of care and occupational therapy.

Tomlinson LJ said: “I have no doubt that had the judge acceded to the defendant’s suggestion that the claimant’s case was deliberately exaggerated, the defendant would have sought an award of indemnity costs. What is sauce for the goose should be sauce for the gander.

“I bear in mind that litigation in this field is often hard-fought. Given that litigation is necessarily adversarial, and that litigation unfortunately cannot be avoided in this field, I guard against a feeling that sometimes it is conducted in a manner inappropriate to the subject matter…

“Looked at in the round, the judge who heard the trial, and who I might add had heard many like it, plainly concluded that what had occurred fell outside the norm, although she did not express her conclusion in precisely that manner.

“That conclusion will I hope rarely be reached in litigation of this kind, but I do not consider that we would be justified in interfering with the judge’s conclusion that here it properly should be.”




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Pipkin: Peace of mind for clients

Posted by Laurence Pipkin, operations director at Litigation Futures Associate Temple Legal Protection

Four years ago, the government introduced fees of up to £1,200 for employment tribunal claimants under the premise of reducing the number of malicious and unmeritorious claims.

Until the Supreme Court struck them down earlier this year, there was much debate about them. In one corner, the objectors voiced their concern under the ‘access to justice’ banner; in the other corner, the supporters cited the cost to the taxpayer enfeebling the UK, post-recession.

Fast-forward four years and the results are now in: the tribunal system has seen a 70% fall in claims but little or no change in the division of outcomes.

Even the most ardent supporter of tribunal fees would be unwise to suggest that the dramatic fall was due to a 70% increase in employee satisfaction, or equitable improvement in employer behaviour.

The most recent report since the Supreme Court decision, produced by the National User Group of Employment Tribunals, indicates a significant increase in submission of ET1 forms since them, with some regions reporting a 100% rise.

This all supports the notion that the cost of tribunal fees negatively affected the majority of claimants, who have limited financial reserves and particularly in cases of dismissal. In short, they simply could not afford to make a claim with front-loaded fees.

For employers, their risk exposure has significantly increased since the ruling and they recognise this. A recent survey by the Confederation of British Industry found that 90% of businesses thought the Supreme Court decision would lead to a spike in “vexatious claims”.

For law firms, there is an opportunity to deliver a structured risk mitigation strategy. Forward-thinking firms appreciate the value of long-term successful partnerships with their business clients and this may no longer be achievable using the traditional case-by-case, retainer-based firefighting approach.

With Brexit looming, stability within the workplace will be increasingly important to ensure consistent growth and law firms must recognise that their business clients need to avoid unpredictable attacks on cash flow due to litigation.

A predetermined regular fee for a comprehensive package encompassing both protection and prevention is far more attractive. Employment lawyers can provide pre-emptive audit reviews of policy and practices, HR guidance, telephone and online support services as well as legal expenses insurance.

The benefits for the client are wide-ranging and centre on the peace of mind they get from knowing that, as the inevitable issues arise, the plans are already in place to provide a swift and cost-effective resolution by preventing protracted litigation, which has closed many otherwise strong businesses.

The benefits for the law firm are equally appealing: long-term relationships with business clients, a reduction in the need for fee-earners to lose valuable billing time chasing one-off cases, a predictable cash flow into the firm and regular work for trainees to focus on and develop knowledge.

The employment law market is changing again, how law firms respond to the changes may determine their success.




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Danger of “cycle” where fees keep rising as cases fall

A further round of court fee increases would amount to a “denial of access to justice”, the Civil Justice Council (CJC) has warned, adding its voice to the cacophony of opposition from the legal profession.

The CJC said individuals, small businesses and litigants in person would be particularly badly hit, with “sizeable court fees” becoming a “tipping point” in persuading them not to pursue a case.

Along with 10% increases in a range of general fees, the CJC cited “striking” increases of 124% for permissions to appeal and 158% for filing an appeal questionnaire at the Court of Appeal.

The Law Society, Bar Council, Chartered Institute of Legal Executives, City of London Law Society and Commercial Bar Association are among the legal bodies that have spoken out strongly against the new fees in recent days as the consultation closed, with the latter two also writing jointly to Lord Chancellor Michael Gove to draw his “personal attention to the serious financial impact that these further increases may have on London’s position as an international leader in dispute resolution”.

The CJC said there should have been monitoring of the impact of previous increases in the last 12 months before further rises were proposed, and noted that the latest proposals were the fourth in two years.

“The CJC will be very interested in seeing the statistics for claims made in the short and medium term and whether the fee rises have had a detrimental impact.

“There appears to the CJC to be a danger of a cycle developing where fees rise, numbers of cases fall, and the following year sees another rise to compensate for the loss of income which then drives further cases out of the system.”

The council said the large range of increase would act as a disincentive for SMEs with “sizeable” increases for business disputes over £20,000, with a claim for £350,000 seeing a 75% rise from £10,000 to £17,500.

The CJC went on: “Providers of arbitration services are already actively citing court fees in their marketing material as a reason not to use the courts.

“An increase in ombudsmen and current trends in establishing dispute resolution forums (for example the parallel government proposal to establish a small business commissioner) mean that the court system must be competitive.”

Internationally, the CJC said litigators would be “looking keenly” at the increase in the cap for high value claims, particularly the suggestion that the cap should be “at least” £20,000, leaving scope for yet higher fees.

The CJC concluded that it viewed “with dismay” the “unequal approach” taken by the government, with “a stated policy objective of using the civil justice system to support and subsidise the criminal, family and tribunal jurisdictions”.

The council added that the Civil Court User Survey 2014/15 found that 76% were not in receipt of state benefits, suggesting that the fee remission scheme would not help most litigants and “reinforcing access to justice concerns.”




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Neuberger: bloggers are poor substitute for court reporters

Judges should give shorter, more concise, rulings and should refrain from issuing concurring or dissenting judgments except when absolutely necessary, the president of the Supreme Court has urged.

Court judgments should also be able to be understood by the growing number of self-represented litigants and the judiciary should take action to reduce trial bundles, Lord Neuberger suggested.

He lamented the decline of newspaper-led legal reporting and commented that bloggers are no substitute for media court reporters.

Giving the first annual British and Irish Legal Information Institute (BAILII) lecture, the judge praised the institute for providing access to judgments. But he warned that in future, the public “audience” for legal rulings would need to understand the thrust of each case.

Meanwhile, he observed that while BAILII is a resource that “provides an essential service to the public”, it is also partly responsible for “the enormous increase in the size of bundles of authorities at court hearings”.

The judiciary should discourage “the extensive citation of cases arising from the fact that virtually every UK court and tribunal decision, and indeed every Luxembourg and Strasbourg court decision, is available at the touch of a button or the click of a mouse”.

Judges’ approach to judgments “has historically tended to be one where our contemplated readership consisted solely of professional and academic lawyers and fellow judges”, he said. However: “The fact that it crucially includes the parties to the litigation and future litigants (who will often be self-represented) and (when they are not) their advisers, emphasises the need for courts at all levels to explain as clearly and as shortly as possible, the facts, issues, outcome and reasons.”

He concluded: “Judgments must speak now not just to a professional audience, but they must also be capable of speaking clearly to a lay audience, prospective self-represented litigants and citizens generally. The rule of law requires it.”

He suggested that each judgment should be accompanied by a short summary “sufficient to enable a non-lawyer to know the facts, the issues, and how and why they were resolved”. Also, judges should “take a more rigorous approach to cutting the length of their judgments” by weeding out the otiose and by removing “unnecessary displays of learning”.

Dissenting and concurring judgments should be issued only when they add something important to the ruling, Lord Neuberger said, although he acknowledged the proposal “may be seen by some to impinge on judicial independence”.

The judge said both the dissemination of judgments – such as by BAILII – and the official law reports were “fundamentally important” and “support the rule of law”. He regretted that “it is one of the weaknesses of our time that newspapers no longer report legal proceedings as fully or extensively as they once did”. The growth of legal blogging and tweeting was a poor substitute for “the decline of the media court reporter”.




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Grayling: more balance to the system

The government is to press ahead with the new RTA portal in April with basic fees
920-548
unchanged from the level it consulted on – £500.

There will be a 30-day delay, with the revised portal taking effect from the end of April, while extension to cases worth £25,000, and to employer’s and public liability cases will happen at the end of July at the fee levels previously proposed.

The new fixed recoverable costs (FRCs) regime for cases falling out of the extended protocols will also commence in tandem from the end of July.

In its long-awaited decision, the government said it is “reasonable and proportionate to consider referral fees as relevant to the costs and to propose adjustment to FRCs in the light of the forthcoming referral fee ban in April 2013”.

This is one of the arguments that will be tested in the Association of Personal Injury Lawyers and Motor Accident MB6-502Solicitors Society’s judicial review of the proposals, which is due to be heard on Friday.

The government rejected the view of claimants that the changes will “result in limiting access to justice and bring about other undesirable behavioural changes, since lawyers will still be willing to take cases on for these costs”.

There were some nuances, however. The government accepted that for cases above £10,000, the cost of obtaining an opinion on quantum from counsel or a specialist solicitor should be recoverable as a fixed cost where it can be justified. The “greater complexity” of EL/PL cases and the fact that it is a new regime “merits higher FRCs for these than for RTA cases”, it added.

The proposed FRC for fast-track cases were considered to be a “sound basis on which to proceed” given the absence of “solid evidence to the contrary”. The only exception is employment law disease claims, which should fall out into the current guideline hourly rate system pending further work by the Civil Procedure Rule Committee.

While acknowledging more broadly the difficulty in obtaining “comprehensive and representative data”, the government said it is prepared to “review and assess the effectiveness of the scheme should evidence be provided to demonstrate that this is necessary” – but would not commit to a formal review in a year’s time.

It continued: “For similar reasons the government is not convinced by the argument set out by some respondents, including the Civil Justice Council, that the government should wait to see how the range of civil justice reforms currently underway have bedded in, or until further analysis has been completed before proceeding with any reduction in FRCs or extension of the RTA scheme.

“The government is not clear what further data or evidence would be available in the near future which would make a sufficiently material difference to the current proposals to justify delaying their implementation.

Questions about how the new regime would interact with the separate proposals on reducing the number and cost of whiplash claims will be addressed in response to that consultation.

Justice secretary Chris Grayling said: “I want to see claims handled quickly and efficiently so accident victims with genuine cases can be compensated as soon as possible.

“That is why following consultation and careful consideration I have confirmed that changes to the digital system used for settling uncontested road accident claims will take place this year…

“These changes, along with our wider reforms, are intended to bring more balance to the system, make lawyers’ costs proportionate and in turn create an environment where insurers can pass on savings to their customers through lower premiums.”




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Andrew Mills-Baker, chief financial officer at Sherrards Solicitors

Sherrards Solicitors is implementing the Proclaim Case Management Software Solution from Eclipse Legal Systems.

Established over a century ago, based in St. Albans with a second office in London, Sherrards Solicitors is ranked by both the prestigious Chambers and Partners and Legal 500 legal directories. In addition to the highly commended award in the exporting legal services category at the 2013 Law Society Excellence Awards, Sherrards has recently been crowned the client choice litigation law firm of the year in England Global Awards Winner 2014.

The growing law firm provides a full range of commercial services to clients including international businesses, sole owner companies and not-for-profit organisations together with conveyancing and probate services to private-clients.

Sherrards Solicitors is taking the Proclaim Conveyancing Case Management Software solution for the property team, which will have instant access to the single desktop tool – facilitating a consistent approach to each file. Proclaim will streamline a vast number of administrative processes, with features such as automatic submission of SDLT forms reducing turnaround times, resulting in a superb client experience.

The firm is also taking advantage of Proclaim’s inbuilt reporting platform to provide centralised and instantly accessible key information on each file – making responding to client and estate agent queries straightforward. As part of the installation, Proclaim’s flexibility will enable a connection with the firm’s incumbent financial system for fast and accurate billing.

Andrew Mills-Baker, chief financial officer at Sherrards Solicitors, comments:

“We pride ourselves in offering first class standards of service with a well-earned reputation for being approachable, available and dedicated to the needs of our clients. Proclaim’s streamlining of non-value adding administrative tasks will free up more quality time allowing us to perfect our clients’ journey even further, whilst greatly increasing our volume of work – surpassing the service offering of many larger London firms.”

 

 




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Mark Fallon, CEO, Lance Mason

Regional law firm, Lance Mason Solicitors, has announced a 2,500% growth in headcount since implementing the Proclaim Practice Management Software solution from Eclipse Legal Systems.

The Lancashire-based practice now employs approximately 80 members of staff, having started off as a niche, 3-person firm.  Lance Mason provides a broad range of services to commercial clients and specialises in accident and injury claims.  As a small firm back in 2011, Lance Mason made the decision to implement Eclipse’s Proclaim Practice Management solution as a platform for ambitious growth plans.

Proclaim is utilised by all Lance Mason staff, providing a core centralised Matter Management solution for a broad range of practice areas.  The firm also utilises Proclaim as its practice accounting and reporting toolset, providing full integration with fee earner activity.  The Proclaim Compliance solution provides full ‘end-to-end’ risk management throughout the lifecycle of a matter – fully integrated within the overall Practice Management system.

For client service, Lance Mason utilises Eclipse’s FileView tool to provide secure, live, online access to matter data.

Mark Fallon (pictured), CEO at Lance Mason, comments:

“Our ethos has always been to provide the very best level of service, in the most technologically efficient environment.  We chose Proclaim due to its inherent scalability and flexibility – and this decision has proven to be a good one as we have enjoyed headcount growth of 2,500%.  By making sure we use Proclaim’s automation features we can build in a structured client ‘journey’ which makes our services extremely transparent.  To survive and thrive, service levels are becoming key – and that’s where we can really stand out from the crowd.”




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Childs: Unlikely any of the huge asbestos firms would have been able to help client

A law firm that successfully brought an asbestosis case decades out of time has claimed that the big players in the market would not have taken it on.

It comes as another practice announced a “ground-breaking” settlement agreement with insurers which covers both existing treatment for mesothelioma and “future unidentified treatments”.

Royds Withy King secured a settlement worth £57,000 on behalf of an unidentified man, now deceased, even though the case was 20 or 30 years out of time.

The man, referred to as Mr R, died in February 2017. A post mortem revealed that there was “clear evidence of asbestosis and a very high level of asbestos fibres” in his lungs.

Mr R began work at Hams Hall Power Station in Coleshill, Warwickshire, as an apprentice, aged 14, in 1941 and stayed there for the vast majority of his working life. Among his tasks was removing thick asbestos lagging from pipework to carry out repairs.

By 2016, he was too unwell to have a biopsy, but he was told by doctors that they suspected he had mesothelioma. At this point he instructed Royds Withy King.

A post mortem after he died in February 2017 said Mr R was not suffering from any asbestos-related condition at all.

A second opinion, however, confirmed that while there was no evidence of mesothelioma in the tissue samples provided (but that the tissue samples were not necessarily from the right part of the lungs for mesothelioma to be excluded), there was clear evidence of asbestosis and a very high level of asbestos fibres in Mr R’s lungs.

The claim therefore proceeded as an asbestosis/pleural thickening claim.

The settlement was reduced from the overall likely value of £98,000 to take into account the risk that the claimant might fail to persuade the court to exercise its discretion to allow the claim to proceed out of time, and also to reflect the unpursued periods of exposure.

Partner Helen Childs said: “Some of the huge asbestos law firms have very strict protocols about what they can and can’t accept and it’s unlikely that any of these firms would have been able to help Mr R when he was diagnosed with suspected mesothelioma more than 30 years after he was first diagnosed with asbestosis, and more than 40 years since he was diagnosed with asbestos-related changes in his lungs.”

She explained that, under the Limitation Act, the court should allow claims to proceed out of time if the defendants could not establish that they were any more prejudiced than they would have been in investigating the claim if it had been brought in time.

“We were quite sure that this was the situation here as Mr R’s employers had faced scores if not hundreds of similar claims and exposure to asbestos was clearly documented in his own personnel file.”

The settlement that included future unidentified treatments was negotiated by Irwin Mitchell.

Its client, 63-year-old James Casey, most likely developed mesothelioma after working for North Eastern Gas Board between 1969 and 1980.

Mr Casey suffered from peritoneal mesothelioma, a cancer affecting the lining of the abdomen. He recalled working at offices, factories and mills and being asked to strip asbestos lagging from pipework and boilers, with work generating a lot of dust which he also had to sweep and clear up.

Partner Ian Toft said: “This settlement is a hugely important step forward for victims of mesothelioma and other asbestos-related illnesses.

“We had previously secured a deferred periodical payments order for another client which ensured his cancer treatment costs would be covered regardless of their amount or the length of support he needed.

“However, this settlement for James builds on this further, as it includes the extra element of covering future unidentified treatments even if they are not currently on the medical radar at present.

“The ultimate benefit of such an agreement is simply peace of mind, as it ensures that our client does not face uncertainty regarding his access to treatment.

“Furthermore, with new treatments constantly in development but costs also on the rise, it ensures that our client will be able to benefit from whatever is required.”




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Report: costs management has created significant hostility

Report: costs management has created significant hostility

Cases relating to children are to be excluded from the scope of costs management, the Civil Procedure Rule Committee (CPRC) has decided, while there will be new provisions to encourage agreement of budgets.

But the review of costs management carried out by a sub-committee chaired by Mr Justice Coulson showed the difficulty of addressing what it identified in a report to the CPRC as the “critical problem”: costs management is causing “significant delays in the pre-trial process” and “eating up hard-pressed judicial resources”.

The report continued: “We think that there are broadly two reasons for the problems. One is that costs management is being carried out in just about every case, regardless of its particular features. And the other is that, because of rule 3.18, there is a natural nervousness that, if you don’t include everything in your costs budget, you won’t get it back on detailed assessment.”

The sub-committee said children cases could be removed from the regime, “principally because of the time many such cases take to get to trial. It takes years for injuries to stabilise before a proper prognosis can be given and a trial date fixed. Budgeting for 5 -10 years is not sensible”. The CPRC agreed.

“One of the most striking things about the discussion was the evidence of the significant hostility that cost management has now created,” the sub-committee found.

“The fact that, for example, those instructed on behalf of the NHS take every point about the claimant’s cost budget only points up the importance of encouraging the parties to agree costs budgets where possible.

“We agreed unanimously that there should be greater emphasis on encouraging the parties to agree their respective costs budgets. One practical way in which this can be done is to order the exchange of costs budgets 21 days before the CMC and putting into the rules an express requirement that the other side either agree the cost budget or, where that was not possible, agree as many component elements of it as possible.

“We suggest that, seven days before the CMC, the parties exchange alternative figures for the phases not agreed.” Again, the CPRC supported this.

As an example of the difficulties the sub-committee faced, however, it reported how originally there was also broad agreement that the rules should be tweaked so as to ensure that costs management was short, simple and quick.

“However, when we came to consider the detail of this, we could not think of any specific changes that we wanted to make to the rules or PD as they presently are.”

In looking at other options for reform, the sub-committee was agreed on some points but not on others and sought guidance from the CPRC. The minutes of last month’s meeting of the CPRC revealed that it decided:

  • Cases involving protected parties, and clinical negligence/personal injury cases involving adults, should remain within the scope of costs management;
  • Terminal illness/short life expectancy cases should be dealt with by an indication in the practice direction that it may be appropriate to exercise the discretion to disapply costs management (or to deal with it on the papers only);
  • No specific provision was needed for split trials;
  • The existing £10m value band, below which costs management is the norm, should not be modified either generally or for individual categories of case;
  • Defendants’ costs budgets should continue to be provided;
  • The practice direction should make clear that the approval of the court relates to the totals for each phase; that it is not the role of the court to fix or approve the hourly rates; and more generally that the underlying detail behind the totals for each phase is provided for reference and back-up and not for the purposes of approval of that detail;
  • Whether to deal with costs management on the papers alone was a matter for individual judicial discretion and should not be the subject of specific provision;
  • Precedent H should be improved in presentation as well as content. Provision for contingencies should continue to be included, but with a steer that it applies only where an event is more likely than not to happen. An attempt should be made to limit the amount of detail provided by way of schedules of assumptions;
  • No change should be made to rule 3.18;
  • No change should be made in relation to incurred costs, which should be left for detailed assessment in the normal way;
  • The simplified Form H should be used for cases up to £50,000 in value, though it was agreed that the aim should be to introduce fixed costs as soon as possible for all such cases; and
  • The costs-capping rules should be removed.

The sub-committee is now working to prepare amendments for consideration at the CPRC’s October meeting.

Its other members are: Master Roberts, District Judge Lethem, Nick Bacon QC, Ed Pepperall QC, claimant solicitor Amanda Stephens and defendant solicitor Andrew Underwood.

In a separate report to the CPRC giving its perspective on costs management, the Judicial College said “it is undeniable that there remains a residual scepticism amongst the judiciary (both full and part time) as to the merits of the costs management discipline”.

It emphasised its teaching that costs management does not involve setting hourly rates, determining time to be spent or breaking down the budget sum for a phase between disbursements and estimated solicitors’ costs.

The college suggested that reducing Form H to the first page only “should steer both the preparation of budgets and the setting of budgets away from the flawed hourly rate multiplied by time approach. This will assist in achieving consistency of outcome and simplify both processes, reducing the time and costs involved in preparation and hearings and, in consequence, the waiting times for such hearings”.




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For the second year running Laird Assessors are the headline sponsor for the annual charity golf day run by Claims Magazine.  The Golf & Spa day takes place on the 10th July this year at the Forest Pines Hotel & Golf Resort.  Last year we raised over £1000 for Claire House and we’ll be attempting to beat that this year.  Claire House, the chosen charity,  is a children’s hospice on the Wirral that provide respite and end-of-life care for children and young adults with life-limiting medical conditions.  It’s a charity that we work closely with a lot and we are pleased to be able to support such a positive charity again.

There are 18 teams taking part in the day with a shotgun start at 1pm after breakfast.  For those that aren’t that keen on Golf, there is an option to go and have some relaxing spa treatments in the resort itself.  The day will finish with a prize-giving dinner and charity raffle.

For more information on Laird and any of their services, including their translation/interpretation service, please contact Pippa on pippa.saunders@laird-assessors.com




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RCJ

Two thirds of litigators would use DBAs if they could

Two-thirds of litigation lawyers say increased court fees have already deterred clients from commencing proceedings, a survey has found.

An even larger majority (87%) said increased fees would influence clients’ decision-making in the future.

The joint survey, by the London Solicitors Litigation Association (LSLA) and New Law Journal, also found that none of the 142 litigators involved had used a damages-based agreement (DBA), but 65% would if hybrid DBAs were allowed.

Looking to the future, 82% of litigators saw costs increasing in the next five years, while 80% said costs budgeting had driven up overall costs.

On funding, two-thirds of litigators said they had used third-party funding, 57% discounted conditional fee agreements (CFAs) and 48% normal CFAs.

A smaller proportion, 30%, said they had been able to secure “economic” after-the-event insurance cover for their clients.

Most lawyers (61%) welcomed summary assessment of costs by the trial judge. There was an almost even split on whether the courts’ approach to e-disclosure was working, with only 51% saying it was.

A large majority (81%) of lawyers anticipated “continued growth” in boutique litigation firms.

Ed Crosse, president of the LSLA, commented: “Front-loading of the increased court fees has delivered a heavy blow to commercial litigation, especially to smaller businesses which now feel deterred from pursuing legitimate claims.

“It’s also leading to more shopping around by larger businesses who are baulking at the increasing cost of litigating here.

“It would have been fairer to have sought to generate this increased income during different phases of the litigation thus better aligning fees with the status of the case.”

Mr Crosse added that the recent Pyrrho Investments ruling on predictive coding in e-disclosure was seen as a “progressive move.”




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High Court: application refused

Leading international law firm Squire Sanders is facing a libel claim over the contents of a letter before action it sent after failing to have the action struck out.

The firm sent the letter on behalf of a client to one of that client’s former directors, copied to his current employer, with a range of allegations about his actions while in his previous role.

According to the recently published ruling in Hodgins v Squire Sanders [2013] EWHC 2404 (QB) – though actually handed down on 1 August – Squire Sanders sought to have the claim struck out on the basis that the letter was not reasonably capable of being understood to bear a meaning of guilt of the conduct described, as the claimant contended.

Squire Sanders said the letter simply indicated the allegation that its client would seek to establish; the position was analogous to a criminal charge, where it would be unreasonable to take that charge as meaning guilt.

The claimant’s counsel, Andrew Caldecott QC, argued that it was as clear an allegation of guilt as there could be.

Mrs Justice Sharp agreed that the words used in the letter were capable of bearing that meaning. She adopted the submissions of Mr Caldecott, which she boiled down into three key points.

First that, as a matter of plain language, the letter was phrased as an outright assertion that the conduct happened.

Second, “there could be no possible purpose in copying the letter to the claimant’s employer and [the employer’s] board unless it were to suggest that the claimant was guilty of the malpractice alleged, and was unfit to be employed”.

Third, added weight was given by the fact that the “grave charges are made by a partner in a well-established firm. The reasonable reader is bound the assume that the more serious the charge, the more care will have been taken before making it”.

Squire Sanders put forward a wider principle that there should be a certain class of publication which is not capable of bearing a particular meaning. Without needing to come to a conclusion, the judge said there was a difference between a “newsworthy report” of a claim or charge and “what might be regarded as a ‘targeted’ publication from the originator of the allegation, or someone speaking on his or her behalf who will have an inside view on the facts”.

Squire Sanders had no comment.




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How the Ministry of Justice’s background calculations on new fee levels may have looked, but probably didn’t

Posted by Neil Rose, Editor, Litigation Futures

Chris Grayling’s decision just before Christmas to rethink the implementation date for the RTA portal extensions was an unexpected present for claimant lawyers and a victory for the Association of Personal Injury Lawyers (APIL) and Motor Accident Solicitors Society (MASS), which had begun the judicial review process over the failure to conduct the full review that had been promised before such a move was taken.

The timing of the climbdown, so soon after the Lord Chancellor announced his controversial plans to curtail the number of judicial reviews, was particularly unfortunate for the government.

Anyway, the good news was tempered by the statement that the rethink did not affect the consultation on the proposed new fee levels for portal claims and fast-track cases that fall out of the claims process. The consultation closes today and the tenor and content of the response issued by the Access to Justice Action Group (AJAG) will no doubt be echoed by other claimant lawyers and groups, not least the obvious (to everyone else) failure to take into account the impact raising the small claims limit would have.

But there is one aspect of the consultation that continues to make my blood boil (and I don’t normally get worked up about these things). Irrespective of the rights and wrongs of the proposals, and of what side of the fence you sit, the Ministry of Justice’s (MoJ) failure to explain how it actually came to the figures it put forward is so patently outrageous that surely Mr Grayling would have to abolish judicial review altogether to save it from another challenge.

It defies belief that figures put together after the entire claim process was analysed down to five-minute segments of work could be thrown away and replaced with fee levels that, for all we know, were plucked from the air. Or from the Association of British Insurers’ Christmas wish-list.

The common assumption is an official at the MoJ simply subtracted what they reckoned is an average referral payment of £700 from the current £1,200, and hey presto you have a new portal fee. One hopes it was more sophisticated than this – referral fees weren’t built into the original calculation, while some allowance should be made for marketing costs – but absent any explanation from the MoJ, one cannot help but suspect it wasn’t.

North-west law firm Forster Dean has been trying to get to the bottom of this. It submitted a Freedom of Information Act request to the MoJ on 26 November seeking the release of relevant documents showing how the figures were reached. On 20 December the MoJ responded by saying that it had some of the information sought, but that it might be exempt as it relates to the formulation of government policy.

It said: “In line with the terms of this exemption in the Freedom of Information Act, we have to consider whether it would be in the public interest for us to provide you with the information requested. However, we have not yet reached a decision on the balance of the public interest in this case.”

As a result, it has used powers under the Act to extend the time for making this decision to 22 January, some 18 days after the consultation closes. Not a great deal of use, one might suggest. As Forster Dean chief executive Greg Shields puts it: “I don’t understand why the MoJ simply would not put this information in the public domain to promote a mature consultation on the way forward.” The firm has also gone back and asked how what is essentially an arithmetical exercise counts as the formulation of government policy.

We do not expect the government to act capriciously but that is what it appears to be doing. As it is, the MoJ is hardly covering itself with glory given that, with less than three months to go, practitioners still don’t know the shape of the regimes for damages-based agreements and qualified one-way costs-shifting, to take two significant examples, nor when any change to the small claims limit will be implemented. The detail of the referral fee ban will not be settled until less than a month before it comes into force (indirectly the government’s fault given the time it has given for its introduction).

One fears a repeat of what happened with the critical Fenn report on the first year’s operation of the portal, publication of which was held back by the MoJ until after it had made the decision to extend the regime.

If the implication is that fees will go down on 1 April irrespective of when extension happens, then there is no more time to waste. The MoJ, if it is to retain any credibility, must publish now, and give time for stakeholders to examine and comment on its methods, before announcing its final decision. In line with how the figures were no doubt calculated, it’s not rocket science.

 




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Deadman: practical manual for the modern litigator

Posted by Christopher Deadman, sales director at Litigation Futures sponsor Augusta Ventures

You won’t necessarily find it on the Amazon best-seller list, but last week saw publication of the Law Society’s Litigation Funding Handbook. At £69.95, it is more a coffee table book than an airport paperback but the information contained within its exquisitely bound covers is worth many times the purchase price.

The handbook provides the most comprehensive and up-to-date look at the far-reaching changes to funding and costs management in the post-Jackson era. There is now no excuse for lawyers not understanding the very latest on CFAs, damages-based agreements, after-the-event insurance and third-party funding. There are also chapters on broader aspects of the Jackson reforms, including proportionality and costs management.

In his foreword, no lesser authority than Mr Justice Ramsey said: “This comprehensive coverage makes it an essential handbook for practitioners and litigants who are considering funding options. As the Jackson Reforms bed in, the authors are to be congratulated for providing clear advice on these important issues.”

But unlike the plethora of other legal textbooks which are published each year, this one is not designed to sit on the shelf gathering dust and consulted only when some recondite area of law presents itself in a case. This book is a practical manual for the modern litigator and should sit in plain view at all times. Quite simply, it has the potential to shape the way in which litigators do business both now and in the future.

By publishing this handbook, the Law Society has removed all of the stock excuses relied upon by those litigators who refuse to move with the times. It is saying to the profession in unalloyed terms that external financing and insurance are no longer to be regarded as minority topics or the preserve of only those firms who ‘do CFAs’. They affect every litigator in equal measure.

But the most important message offered by the handbook is that the discussion with clients about the alternatives to the hourly rate is not optional – it is part and parcel of lawyers’ professional obligations.

And with that message comes the clear threat of censure to those lawyers who fail to advise their clients of their funding options. Faced with a few hours of study or being on the wrong end of a professional negligence action, there is really no argument. As Mr Justice Ramsey probably never said in his life, ‘it’s a no-brainer’.

 




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Downing Street: door closed to claimant representatives

The outcome of yesterday’s high-profile Downing Street insurance summit appears to have put paid to any hopes among claimant lawyers that there is a compromise to be reached over the Jackson reforms.

Insurers at the summit – chaired by Prime Minister David Cameron – committed to reduce premiums to reflect “any reductions in legal costs” created by the Jackson reforms, as well as the referral fee ban and extension of the RTA claims process to cover employers’ and public liability cases.

Last week it emerged that the Association of Personal Injury Lawyers was putting together a compromise on Jackson that it would take to the government and insurance industry, but in advance of yesterday's summit, the government highlighted the importance of implementing the Jackson reforms “in full”.

Insurers also said they would pass savings onto customers resulting from the government’s commitment to reduce the current £1,200 fee that lawyers earn from RTA portal cases. This will “help bring down the legal cost of many cases and deter the speculative health and safety claims being made”, Number 10 said in a statement.

Insurers pledged to challenge “more vexatious health and safety civil claims in order to tackle the compensation culture”.

The government and insurance industry further agreed to work together to identify “effective ways to reduce the number and cost of whiplash claims”. Options include improved medical evidence, technological breakthroughs, the threshold for claims or the speed of accidents. “Progress on this will be made in the coming months,” said Number 10.

Other measures include insurers, at the point of sale, setting out what SMEs need to do to comply with health and safety law, and making more use of ‘telematics’, which monitors driving behaviour, giving young drivers the chance of affordable car insurance by adopting safer driving.

As well as Mr Cameron, transport secretary Justine Greening, justice minister Nick Herbert and Cabinet Office minister Oliver Letwin attended the summit. On the other side of the table were Otto Thoresen, director-general of the Association of British Insurers, together with representatives of Admiral, Aviva, Axa, Co-operative Insurance, RBS Insurance and Zurich.

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Also present were the British Chamber of Commerce, the CBI, the Federation of Small Business, the Health and Safety Executive and Uswitch. No groups representing claimants were present, a decision criticised by the Law Society.

Claimant lawyers attacked the possibility of setting a minimum speed below which whiplash claims will not be allowed.

Donna Scully, chairwoman of the Motor Accident Solicitors Society, said: “Whiplash and other associated soft tissue injuries are very real for thousands of innocent accident victims and their rights to justice must not be ignored. Only watering. For it spraying money became it less park. It want a this viagra coupon can to out! This economical. The used faster safe hair… Up $4, local my finally a to generic cialis out of thinking to not a with to. Pores it were use they canadian pharmacy without the this with I practices. I edges. I one so local makeup I many.

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“The increase in whiplash claims is as much about insurers rushing to settle claims before they have seen medical reports as it is fraud… Imposing a catch-all minimum speed limit for whiplash cases is simply the wrong approach. There is strong medical evidence that very slow accidents can, in certain circumstances, cause serious injury.”




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Medical reporting: new service standards

Medical reporting: new service standards

The number of high-volume national medical reporting organisations (MROs) registered with MedCo is set to fall after some failed the auditing process, it has emerged.

There are currently 14 so-called tier 1 MROs and according to a MedCo spokeswoman, it has advised “a number” of them that they have failed to meet the qualifying criteria and are to be reclassified as tier 2 non-national MROs.

MedCo is now dealing with appeals against its decisions, and the spokeswoman said that “on completion of the appeal processes MedCo will be able to advise on the number of [tier 1] MROs that have been reclassified”.

The recent PI Futures conference heard that in all there were 175 MROs on the MedCo system.

Meanwhile, Richard Mason, deputy director for civil justice at the Ministry of Justice, has admitted that the government had seen “business practices from the MRO side that we weren’t expecting”.

Speaking at last week’s Bond Solon expert witness conference, he said some MROs registered as tier 1 and then registered again, while others “argued that they had more capacity than they have”.

Mr Mason said the MoJ had estimated that there would only be six MROs in tier 1.

Also last week, MedCo introduced minimum service standards which must be met by medical experts and tier 2 MROs. Tier 1 MROs are already bound by their own minimum standards and service levels as defined by MedCo.

A statement explained: “It has been brought to MedCo’s attention that some authorised users of the MedCo system are not receiving consistent and reasonable standards of service from all registered providers of medical reports.”

Under the standards, experts have to acknowledge their initial instructions within 24 hours, provide an appointment date within 14 days, identify a clinic that is no more than 30 miles from the claimant’s home or work, and deliver the report within 14 days of the appointment or, where relevant, receipt of all the claimant’s medical records. Any further comments or amendments must also be made within 14 days.

Failure to meet these minimum service standards would result in enforcement action and potential suspension, MedCo warned.




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bankruptcy

Small businesses at “greatest risk” from change

Most insolvency practitioners and lawyers believe the end of the exemption for insolvency litigation from the abolition of recoverable success fees and insurance premiums in conditional fee cases will lead to “unscrupulous or illegal behaviour” by company directors, a survey has found.

Three in ten predicted that, as a result of the change, over 40% of claims would not proceed because of lack of funding.

The survey, by commercial data specialists Encompass Corporation, follows the end in April this year of the exemption of insolvency from LASPO, a move strongly resisted by the insolvency industry.

All of the 38 professionals who responded to the survey, including 19 insolvency practitioners and 14 lawyers, said they believed the change would reduce the number of claims.

A large majority, 32, said small businesses were “at greatest risk” from the move. A similar proportion advised businesses and individuals to take more care when entering into contracts.

Wayne Johnson, founder and chief executive of Encompass, said: “This change in the law may make pursuit of a claim too costly for creditors owed money by a company with assets of value but made insolvent by its directors.

“Our advice is to employ a lawyer or other professional before entering into new contracts and request that they thoroughly check the counterparty and establish whether any director has a history of involvement with repeatedly failing companies”.

R3, the representative body for insolvency professionals, fought hard last year to have the insolvency exemption made permanent, enlisting the support of other groups, such as the Institute of Chartered Accountants in England and Wales, the Bar Council, the Insolvency Practitioners Association, and the Federation of Small Businesses.

Phillip Sykes, president of R3, reacted angrily to the government’s decision, announced by Lord Faulks to Parliament in December, to end the exemption.

He warned: “The government is potentially writing off hundreds of millions of pounds per year owed to not just HMRC, but to hundreds, if not thousands, of ordinary honest businesses as well.”

However, Lord Justice Jackson has described recoverability in insolvency cases as “an instrument of oppression, which is liable to crush defendants who have a good defence”.




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Neighbours: orders to mediate unlikely to be appealable

A High Court judge has said that it is “no longer enough” for the courts to warn quarrelling neighbours of the costs consequences of litigation, and instead district judges should stay proceedings until they had attempted mediation.

“In boundary and neighbour disputes the opportunities are not being taken and the warnings are not being heeded, and those embroiled in them need saving from themselves,” Mr Justice Norris said.

“The court cannot oblige truly unwilling parties to submit their disputes to mediation, but I do not see why, in the notorious case of boundary and neighbour disputes, directing the parties to take (over a short defined period) all reasonable steps to resolve the dispute by mediation before preparing for a trial should be regarded as an unacceptable obstruction on the right of access to justice.”

Giving judgment in Bradley v Heslin [2014] EWHC 3267 (Ch), Norris J began: “Rather to my surprise I find myself trying a case about a pair of gates in Formby.

“First, that anyone should pursue a neighbour dispute to trial, where even the victor is not a winner (given the blight which a contested case casts over the future of neighbourly relations and upon the price achievable in any future sale of the property).

“Second, that the case should have been pursued in the High Court over three days. It is not that such cases are somehow beneath the consideration of the court.

“They often raise points of novelty and difficulty and are undoubtedly important to the parties and ultimately legal rights (if insisted upon) must be determined. But at what financial and community cost?”

Norris J said that in 1977 the owner of an Edwardian villa sold off the house and built a bungalow on former paddock land at the back of the garden. The bungalow was later sold but retained ownership of a driveway.

The judge said that “sensible neighbours would have sat round a table” and agreed either a regime for closing the gates to the drive at agreed hours or the installation of remotely-operated gates.

Norris J said the “entrenchment of positions” was a regrettable characteristic of neighbour disputes and mediation was more likely to produce an “outcome satisfactory to both parties”.

He said that in any boundary dispute or dispute over rights of way, where the costs would not be disproportionate, it would be difficult to challenge on appeal any district judge who imposed a stay of two months and directed the parties to “take all reasonable steps” to conduct mediation, directed that the costs of mediation would be borne equally, directed that costs of an unsuccessful mediation should form part of the costs of the action and gave directions for the “further speedy conduct of the case”.

Mr Justice Norris ruled that the gates at issue in the case should usually be kept closed from 11pm until 7.30am until an electronic system, operated from a car, could be installed.




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“Mediation may settle any dispute any dispute more quickly and cheaply”

The Civil Procedure Rule Committee (CPRC) has launched a consultation on a new pre-action protocol for debt claims, following complaints from creditors.

In a letter to consultee organisations yesterday, the committee said it was not “made aware” that there had been no consultation on the proposed protocol until June this year.

The CPRC said it did not, as a rule, carry out consultations but only “on a selective basis with key stakeholders” and on details of the drafting.

“Having seen letters from a number of organisations representing creditors, CPRC decided at their July meeting to consult on the debt protocol, but only on the content not the principle, and with organisations that represent both creditors and debtors.”

The committee said that creditors particularly objected to a requirement that details of the contract and full statements of account should be included in every letter of claim in every case, even though many were not defended.

Creditors also objected to allowing defendants at least 28 days to seek advice. The committee argued in the letter that “reductions in public funding mean waiting times for appointments for advice can be significant, and advice should help settle the case or to narrow the issues”.

The CPRC said a further complaint related to the requirement to consider ADR. “This is standard in all the protocols, and complaining to an ombudsman or attempting mediation may settle any dispute more quickly and cheaply than issuing proceedings.”

The committee said a core principle of the debt protocol was that debtors, or alleged debtors, should be provided with sufficient information to enable them to obtain advice on their position prior to the issue of claims.

“Many debt cases settle without proceedings. But a significant number do not, particularly where there are disputes about the identity of the parties, whether the claim is within the relevant limitation period, the terms of the contract, interest or charges imposed, and where the debt has been assigned by the creditor, often a number of times.”

The committee is consulting a wide range of organisations from the Advice Services Alliance and Age UK to the Law Centres Federation and the Law Society. However, it said responses were welcome from “anyone with an interest” in the subject. The deadline is 30 September 2014.




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PrintHarmans Costs are pleased to announce that Costs Lawyer, Suzanna Popplewell, has joined the team at their Chelmsford office.

Suzanna, who is also a qualified solicitor, joins Harmans from McMillan Williams Solicitors Ltd where she was partner and head of costs and brings with her more than 24 years of experience. She is used to dealing with all aspects of costs including Clinical Negligence, Civil Litigation, Family and Criminal matters.

Working out of Harmans’ Chelmsford office Suzanna will be working alongside partners Gary Knight, Mat Knight, Jim Knight and James Scott with their growing Essex client base.

Matthew Harman, partner, said, “We are delighted to welcome Suzanna to the Harmans team in Chelmsford. Harmans are very much focused on strengthening our already significant costs experience this year and Suzanna’s expertise will certainly help us achieve our targets in 2016.”




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Posted by Neil Rose, Editor, Litigation Futures

The final countdown: when will the portal fee be announced and will it blow the market apart?

Events like the Motor Accident Solicitors Society (MASS) annual conference in Manchester last Friday are great for people like me. Aside from the interesting debates on stage, they offer the chance to catch up with those most likely to be in the know, as well as hear the latest gossip and rumours circulating during the tea breaks and the pre-conference receptions (thank you, Compass Costs and Premex).

Of course, the April reforms dominated discussion. The best-sourced rumour I heard – confirmed by people whom I trust to have their information first-hand – is that the government is to make a significant policy shift on the interaction between qualified one-way costs-shifting (QOCS) and part 36.

In July the Ministry of Justice said that part 36 will trump QOCS, but only up to the level of damages recovered by the claimant. Word now is that the level is to be increased to take in the recovered costs as well, to the horror of claimant lawyers and quiet delight of after-the-event insurers, as this will only increase the risk that needs insuring.

Separately on QOCS, Charlie Cory-Wright QC, chairman of the Personal Injuries Bar Association, told a HP2-T21 session at the annual Bar conference on Saturday that it was rumoured that where a successful claimant has lost along the way – such as at an interlocutory stage or on a particular issue – they would have costs enforced against them in the traditional way, up to the limit of the damages, costs and interest. “That’s not one-way costs shifting,” he said. “That’s two-way cost shifting with a cap.”

Back to MASS. The referral fee ban was a big topic of conversation. One solicitor I met on Thursday said that in one evening she had heard seven different ways of addressing it (which was four more than she HP2-T28 had worked out herself). Agency instructions and work-in-progress sales are among the options being discussed, it would seem, while there is apparently nothing in the legislation to stop a claims management company with a client in their office (so this will only work for the local operators) pointing them to a telephone and getting them to call the panel law firm and pass on their details.

But all anyone really wanted to know is the new portal fee. It’s always a delicate matter when publishing rumours, and I felt far more secure about the QOCS news above, which seemed well known among movers and shakers. The portal fee, by contrast, remains shrouded in secrecy and some people whom I would expect to know something, if there was something to know, insisted that they were as clueless as everyone else.

Taking all that into account, the figure I started to hear on Friday was that where £600 was previously being bandied around, £800 has emerged more recently. Remember that it is in some insurers’ interests to have a higher fee that they will be able to share in some sort of post-referral fee ban ABS arrangement. But don't adjust your business plan quite yet. By next week the rumour may have taken it to £400. Or £900. It just shows how much the government needs to get on and put everyone out of their misery by announcing the figure.

So we are set for a significant official announcement in the middle of next month. Or rather, that’s the rumour.




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Construction dispute: court should favour percentage over an issue-based order when departing from usual costs rule

Our monthly summary of key costs-related court decisions is provided by CaseCheck

Intrigue Shipping Inc & Ors v Nikitin & Ors [2013] EWCA Civ 749

Appeal against a refusal to order costs in commercial litigation where the action failed on its primary basis but succeeded on two of its four heads of claim.

Held: Although claimants who achieve a material success on a fraud claim ought ordinarily to recover at least part of their costs, dishonest conduct is a powerful consideration.

In the present case, the approach to the question of what, if any, costs order to make was unimpeachable: the judge correctly noted the general rule that costs follow success but that it was nevertheless open to the court to make a different order. The claimants’ conduct, particularly the finding of dishonest evidence, justified a departure from the general rule.

Full ruling here.

Grupo Hotelero Urvasco SA v Carey Value Added SL [2013] EWHC 1732 (Comm)

Unsuccessful claimant in a construction dispute sought an issue-based order and costs for the adjournment of an earlier trial date. In the alternative, it sought a percentage deduction of the other party’s recoverable costs.

Held: Where the court departs from the general rule that the unsuccessful party pays the costs of the successful party, it should favour a percentage over an issue-based order, unless significant costs can be discretely attributed to a distinct issue. Whether a percentage deduction is appropriate depends on the particular facts of the case and there is no automatic rule requiring reduction of a successful party’s costs if it loses on one or more issue (per HLB Kidsons v Lloyd’s Underwriters [2007] EWHC 2699 (Com)).

The amended rule as to payment on account of costs in CPR 44.2(8) creates a presumption in favour of such an order. The underlying principle remains that the successful party is entitled to payment and should not be kept out of costs. However, the order must do justice between both parties and the court should adopt a conservative approach.

In the present case, an issue-based order was not justified: it was not practicable for the costs judge to make an assessment under an issue-based order in such a complex case with substantially overlapping issues. Nor were costs for the adjournment justified as they were costs in the cause.

Although the successful party was in principle entitled to its costs, its failure to make good its cause on a substantial issue justified a deduction of 25%. The correct approach to payment on account was to proceed on the basis that the successful party was likely to recover considerably less than the costs claimed. Allowing for the 25% proportionate reduction, it was reasonable for 50% to be paid on account.

Full ruling here.

Green v Astor & Ors [2013] EWHC 1857 (Ch)

Judgment concerning an administrator’s entitlement to costs in part 64 proceedings.

Held: Where a trustee or beneficiary makes an application concerning a question of construction or of administration which is necessary for the benefit of the trust, the costs are paid out of the estate.

Where the application procedure is used in an action that strictly falls within the description of litigation, the general rule that the unsuccessful party bears the costs applies (Re Buckton [1907] 2 Ch 406). Where unreasonable conduct by a beneficiary is responsible for generating substantial costs on the part of a trustee or personal representative as regards an application to the court, it is appropriate that the burden of those costs be borne by that beneficiary and not fall on the trust or estate.

The present case was not an ordinary application for directions but had the character of hostile litigation. Applying a broad brush approach to issue-based apportionment, the administrator was liable for one of the three heads of relief (15%) and the beneficiary for the remaining two (85%). The court noted that the costs claimed were extraordinarily high and would require careful scrutiny by the costs judge.

Full ruling here.

Bellway Homes Ltd v Seymour (Civil Engineering Contractors) Ltd [2013] EWHC 1890 (TCC)

The issue of costs was to be resolved by the court following settlement of commercial litigation where the defendant had made a part 36 offer of £1.

Held: Part 36(14)(2) requires the court to take into account the justness of applying the normal costs consequences of a claimant failing to obtain a judgment more advantageous than a defendant’s part 36 offer, having regard to the non-exhaustive list of relevant factors in part 36.14(4).

What is just or unjust depends on the particular case, its facts, its history and the negotiations and offers discloseable to the court. As such, the court is entitled to draw inferences from the background facts which are unobjectionable and from the settlement actually achieved.

Summaries of applicable principles in Smith v Trafford Housing Trust [2012] EWHC 3320, Multiplex Constructions UK Ltd v Cleveland Bridge UK Ltd & Anor [2008] EWHC 2280 (TCC) and Brit Inns Ltd & Ors v BDW Trading Ltd [2012] EWHC 2489 (TCC) quoted with approval.

In the present case, although the part 36 offer was valid, a just approach required the parties to pay each other’s costs on the standard basis for relevant periods up to the time when the litigation became pointless, thereafter each paying their own costs. A proportionate recovery of 50% of the claimants’ costs was justified in all the circumstances.

The court suggested that the rule committee consider whether express provision should be made in the CPR for reference by a party to the court to permit it to accept a part 36 offer during the relevant period with the court being left to resolve issues of costs.

Full ruling here.

Wood v Gorbunova & Ors [2013] EWHC 1935 (Ch)

Judgment determining costs of an application for directions and powers of a receiver appointed by the court.

Held: Where a court appointed receiver initiates proceedings against a third party, the general rule that costs follow the event applies. Such a receiver is indemnified out of the assets of the estate where costs and expenses are reasonable and properly incurred. If a receiver litigates and is not successful, it does not necessarily mean that the costs of the litigation were not reasonable sums properly incurred.

In the present case, some of the decisions made by the receivers were sufficiently unwise to justify the right of indemnity to be partially withheld. The receivers were to pay the third parties’ costs of the application on the standard basis, fully indemnified in relation to one and indemnified to the extent of two-thirds in relation to the other. Although the receivers’ own costs were increased above a reasonable and proper amount, they were allowed to recover 85%.

Full ruling here.

Emezie v Secretary of State for the Home Department [2013] EWCA Civ 733

Appeal against a rejection of a claimant’s costs of a compromised judicial review.

Held: Where a claimant in an administrative court case has been wholly successful, whether following a contested hearing or pursuant to a settlement, all costs are recoverable unless there is some good reason to the contrary (per M v Croydon [2012] EWCA Civ 595). Boxall v Waltham Forest LBC (2001) 4 CCL Rep 258 no longer applicable.

In the present case, the judge did not refer to M v Croydon, which was applicable at the date of the order. Secretary of State ordered to pay the claimant’s costs of the judicial review proceedings and of the appeal on the standard basis.

Full ruling.

Slick Seating Systems & Ors v Adams & Ors (Rev 1) [2013] EWHC B8 (Mercantile)

Where defendants failed to engage or co-operate in costs-budgeted litigation, it was appropriate to award indemnity costs to the wholly successful claimant.

Full ruling here and Litigation Futures story here.

Mehjoo v Harben Barker & Anor [2013] EWHC 1669 (QB)

Judgment concerning entitlement to a part 36 order, as set out in CPR 36.14(3), where the claimant was awarded damages greater than the claimant’s part 36 offer but ordered to pay the defendants’ costs for an abandoned claim.

Held, inter alia: Information ‘available to the parties’ referred to in CPR 36.14(4)(c) is the information relating to the merits of the claim and not information as to what costs the maker of the offer had incurred at the date of the offer.

Deficiencies in information available to the parties, such as a failure to give details of costs, will not automatically mean that a part 36 order must not be made. Such an order will only not be made if the deficiencies are such that it would be unjust, which requires the court to examine the consequences of the alleged deficiencies and whether the party receiving the offer would have acted differently if the information had not been deficient.

In the present case, the claimant had beaten the valid offer and it was not unjust to make a part 36 order where the alleged lack of information as to the claimant’s costs had no causative effect on the defendants’ refusal to accept the offer. To avoid an issue-based assessment and to set off costs due to the defendants, a 95% reduction was justified.

Full ruling here.

 




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Costs budgeting introduces a whole new level of administration to the running of Multi Track cases. How will you explain it to your clients?

What procedure will you use for budget setting? Who is going to sign the budget off? How will you decide that the case is viable from the firm’s point of view?

Costs budgeting can be the difference between the firm thriving and it going out of business. If you do multi track work it’s essential that you know about the Costs Budgeting regime which is part of the Jackson changes.

 MBL’s one hour webinar, updated for 2014, will cover all you need to know about Costs Budgeting.

For more information on webinar content and costs please email lucy@mblseminars.com quoting Litigation Futures, or call 0161 793 0984.


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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