BIG CHANGES IN LEGAL AID AND NO WIN NO FEE COMING UP IN APRIL 2013

The law on paying legal fees has changed recently, and although it is not coming into effect until April 2013, in certain cases the changes may have an effect now.

At present, most people who have a claim for injury against a hospital trust or other healthcare provider will either receive Legal Aid to cover their legal costs, or their solicitor will act for them on a Conditional Fee Agreement (this is usually called No Win No Fee).

As a rule, clients with the benefit of Legal Aid or No Win No Fee arrangements with their solicitors pay no fees if a case is unsuccessful, if they win their case the costs are met by the losing defendant.

Although Legal Aid and No Win No Fee agreements are not being abolished, the situation is going to change dramatically on 1^st April 2013 because of certain provisions in an act of Parliament called the Legal Aid, Sentencing and Punishment of Offenders Act.

Legal Aid

At the moment any person with a clinical negligence claim may be eligible for Legal Aid provided 1) Their chances of success are reasonable; and 2) Their income and capital are below a certain level. 

From April 2013 only those who have been injured during pregnancy, labour, or the first eight weeks of life will be eligible for Legal Aid.  This is regardless of whether in other respects they have a strong case and/or a very low income.

In addition, there will be a Legal Aid Levy taken from the damages of people with successful claims by the government’s Legal Aid Agency (the organisation set up to administer Legal Aid after April 2013).  The deduction will be 25% of the general damages awarded, that is, the part of your damages that compensates for the pain and suffering endured as a result of the negligence and any past losses (expenses) claimed.

In many cases this could be a very significant sum indeed.

Conditional Fee Agreements (No Win No Fee)

Because of the reduction in availability of Legal Aid many more people will be relying on their solicitors offering a No Win No Fee agreement.  Solicitors will continue to offer this facility to their clients, where if the case is not successful they will pay no fees. 

However, in successful cases there will be changes.

Presently, the costs that claimants recover from defendants include a solicitor’s success fee.  The success fee is calculated as a percentage of the solicitor’s basic fee.  It is used to offset the risk of the solicitor not being paid anything should the claimant lose the case.  It is only payable if the claimant wins the case and will usually be paid by the losing opponent.

However, from April 2013 successful claimants may be deprived of up to 25% of their general damages in order to pay solicitors' success fees, as these will no longer be recoverable from Defendants.

What can you do now?

It is very important that if, before April 2013, you think you may have a claim against a hospital trust or other healthcare provider, you seek legal advice as soon as possible. 

Any No Win No Fee agreement entered into or Legal Aid granted before April 2013 will not be subject to the new rules. 

By instructing a solicitor and establishing the method of funding before April 2013, you may be saving yourself a significant deduction from damages if your case is successful.

To obtain specialist legal advice from one of AvMA’s accredited solicitors you may either telephone our helpline on 0845 123 2352 or click here and select a solicitor from our Find a Solicitor section.

Don't be fooled by the promise of exceptional funding

In response to the countless meetings and volumes of correspondence Avma and our members have had with our MPs, ministers, and civil servants at the MOJ over the removal of clinical negligence from the scope of legal aid we have all had a similar response...

'Solicitors will offer clients CFAs and if not £6m will be available via exceptional funding.'

But by definition, experience, and by linking together information contained hidden deep within three very long documents we say this cannot be the answer

Firstly. How can anything that is exceptional provide for the funding of a whole category


Secondly exceptional funding has been around for a long time in theory, for exceptional personal injury claims, and inquests. The experience of our members is almost invariable, they apply but their clients do not get it.

Thirdly and perhaps most importantly is if you join up the dots and add up the figures the outcome for claimants is not good. They could (and in the case of brain damaged children would) end up worse of than with any other sort of funding because the government would take 25% of their damages to pay back to a supplementary legal aid scheme.

As we say you have to look hard and make connections. But in the green paper it is stated £6m is put aside for exceptional funding. In the consultation published in Nov 2010 a table shows £6m could be available from claimants damages if a SLAS were operated and in its response to the consultation pub June 21 2011 at para 33 page 250 the government sets out the proposal that any exceptional funding scheme for clin neg would be funded by a SLAS based on a 25% levy on all damages except future care and loss

Simples - keep legal aid in scope as it presently is or the most seriously injured will pay

PLAN TO CUT LEGAL AID FOR CLINICAL NEGLIGENCE WOULD COST THE TAXPAYER MILLIONS, INDEPENDENT RESEARCH FINDS

Knock on costs estimated at THREE times predicted government saving

Cutting legal aid for those who have suffered clinical negligence would cost the Government (i.e. the taxpayer), millions of pounds more that it would save Ken Clarke’s Ministry of Justice (MoJ), confirms independent research by Kings College published today by the Law Society.

Unintended Consequences: the cost of the Government’s Legal Aid Reforms (“the Report”) vindicates what campaigners Action against Medical Accidents (AvMA – the charity for patient safety and justice) have been saying since the proposal, one of a host of controversial cuts contained in the Legal Aid Sentencing and Punishment of Offenders Bill (LASPO), was announced.

The Report shows that the cuts proposed in LASPO will give rise to unbudgeted costs of at least £139M, undermining Ken Clarke’s contribution to the Government’s deficit reduction target.

The specific chapter on Clinical Negligence can be found at pages 65-71.  It shows that knock-on costs for Clinical Negligence alone amount to THREE times the predicted government saving.  A proposed budget saving of £10.5m set against knock-on costs of around £28.5m with a net loss of around £18m. This, will, in most part, be shouldered by the NHS.

Unsurprisingly the NHS Litigation Authority itself has already registered opposition to these cuts stating that legal aid is by far the fairest and most economical way to fund these claims; and that Lord Justice Jackson, architect of the Government’s controversial reforms to Conditional Fee Agreements (CFAs or “no win, no fee” agreements), predicated his proposals on there being a system of legal aid still in place. He has said that clinical negligence in particular should remain in scope for legal aid.

Now, the Government faces a rebellion and possible defeat in the Lords unless it drops its plan. Influential Liberal Democrat peers Lord Carlile and Lord Thomas are championing an amendment to keep clinical negligence in scope for legal aid. The Bill is due to be debated on January 10^th.

Peter Walsh, Chief Executive of AvMA said:

“Cutting legal aid for clinical negligence is just bonkers whichever way you look at it. Either the Government is being deeply cynical and people injured by clinical negligence simply won’t be able to access justice, or the taxpayer and the NHS will be hit hard at a time it can least afford it. As the Report states, ‘there is certainly no economic justification for these changes’ (para 9.4.5)”.

Walsh continues, “The Report’s findings also validate our decision to launch Judicial Review proceedings in which we contend that the MOJs consultation, culminating in the Response of 21 June 2011, was manifestly flawed.”

One of the Report’s key conclusions highlights ‘the lack of robust data on numerous elements of the Civil justice system’(9.4.5), echoing AvMA’s grave concerns about the evidence the government used or had access to when supplying reasons for its Response. As a result of its findings, the Report importantly insists that ‘the government addresses the Justice Select Committee’s request for a full and proper appraisal of the knock-on costs before these changes are enacted’. (9.4.7)

Walsh concludes, “It is evident and shown in this Report, that the government has failed to prove two of its key assumptions supporting its proposals, these being, that the new regime will result in significant savings or that the potential savings alone justify the proposed changes.”

AvMA point out that there are even further unintended consequences and costs of cutting legal aid for clinical negligence. The patient safety experts are concerned that if people are unable to pursue claims then errors will not come to light and opportunities for improving patient safety missed. This would result in immeasurable human cost as well as huge costs for the NHS. Further, the clinical negligence legal market would be thrown open to non specialist solicitors and claims farmers, with none of the quality control afforded by publicly funded legal aid.

CAN THE LORDS RESUSCITATE LEGAL AID IN CLINICAL NEGLIGENCE?

As the Legal Aid Sentencing and Punishment of Offenders Bill (“the Bill”) makes its way through parliament, it seems that support to keep Legal Aid in Scope for Clinical Negligence is gaining momentum.

Lord Justice Jackson, author of the somewhat controversial changes to Conditional Fee Agreements, which alongside the proposed cuts to Legal Aid, create a double whammy effect to funding, has himself spoken out.  He comments that Legal Aid should be retained, especially in matters of Clinical Negligence.

AvMA has also launched its own attack on the decision to cut this funding lifeline, by commencing Judicial Review proceedings challenging the decision at grass roots, citing the MOJ’s decision as based on unfair and irrational criteria (see press release).

Now, the Lords have joined the debate.   The Law Society Gazette (29 September 2011, page 3) reports that Lord Carlile of Berriew QC (Liberal Democrat) believes that there will be enough support from all sides to change the Bill.  Lord Carlile adds “Clinical Negligence cases are an example …in which disbursements would work up front; cases in which you don’t know you’re going to have a successful claim, all you can say is there might be one until some expert evidence has been obtained.” (Law Society Gazette, 29 September 2011, page 3).

This is echoed by Tom Brake MP (also Liberal Democrat) who shares a sympathetic approach in keeping Clinical Negligence in Scope, hinting at what appears to be the inevitable scrutiny of the Bill by the Lords.

Our Blog previously reported (03 March 2011) the Judiciary’s condemnation of the removal of Legal Aid funding in Clinical Negligence citing “potential injustice for a small group of vulnerable Claimants if the present proposal is implemented” (para 47, Report).

Let’s make sure this momentum keeps building and bring the issue of access to justice to the forefront of debate.

AvMA has been working hard to get the message out that access to justice will undoubtedly be compromised should the changes stand.  Please see our media coverage links below:

Independent

Law Society Gazette

BBC News

BBC 

STOP PRESS!! BBC Radio Four “You and Yours” will be discussing Clinical Negligence and Legal Aid on Monday 03 October 2011. Peter Walsh from AvMA will be being interviewed at approximately 12:30.

Also visit the campaign section of our website to find out how the changes will effect you and what you can do to help

The News International Smokescreen

The revelation that journalists and private investigators working for News International have been hacking into mobile phone messages and using underhand means to obtain confidential medical records and financial information is truly shocking.

However, what is equally shocking is that leaders of our 3 major political parties are using these revelations to court public opinion.  Further the media furore is a smoke screen behind which 3 Bills going through Parliament which will have a more significant and far reaching effect upon all of us.

The Legal Aid, Punishment of Offenders Bill which has already reached the Committee stage in the Houses of Parliament seeks to deny justice to the most injured and vulnerable of our society.  If all the clauses in this Bill become law people with serious and persisting injuries, caused through the negligence of healthcare workers will be denied access to justice.

At present all children and any adult who qualifies financially is entitled to legal aid to investigate and pursue a claim for compensation if they have been injured in the course of healthcare.  The Legal Aid, Sentencing & Punishment of Offenders Bill seeks to take away that right at a stroke.  The Government explains to us that this is alright because solicitors will act for those people on a no win no fee agreement.  The situation is no so simple, first an individual may have to pay two to three thousand pounds for initial legal costs before a solicitor will consider entering into a no win no fee agreement.  And then if the case is successful up to a quarter of their damages may be needed to pay for the solicitor’s success fee.

The Public Bodies Bill will postpone the appointment of a Chief Coroner for the foreseeable future.  Following a protest led by the charity INQUEST and supported by AvMA and The Royal British Legion, the act to abolish the role of Chief Coroner was amended but the amendment to defer appointment into the future is far from satisfactory.  At present it is very difficult to challenge a Coroner’s decision, whether to hold an inquest or not, whether to admit certain evidence at the inquest or a verdict.  At present the only way to review a coroners decision is by judicial review.  One of the key roles of a Chief Coroner was to consider appeals (by family and friends of the deceased) on these decisions made by coroners.

Finally, the Health and Social Care Bill.  Many will be aware that following challenges to the proposal that consortiums led by GPs were to take over as the purchasers of care for their patients the Government undertook a review.  However, the decision on who leads the consortium of purchasers has only been modified slightly.  It may, at first seem to many that this commissioning has little to do with an individual's healthcare.  However, if a patient neeeds day surgery and finds instead of being referred locally they must travel to a hospital 30 or 40 miles away simply because that hospital will do the procedure cheaper the patient may feel that they are very significantly affected by this change in the law.

This charity will continue to tweet, blog and comment in opposition to such changes that affect the life, liberty and access to justice for the citizens of this country, in particular for patients.  How can it be that a National Health Service, provided by the Government for its people can injure one of its patients yet the Government itself denies access to justice through removal of legal aid?

In addition to our activities on the social media sites we are also working behind the scenes to lobby MPs, brief journalists and press to provide evidence to Government Select Committees.

Our Legal Director, Catherine Hopkins will be giving evidence to the Scrutiny Committee on the Legal Aid, Sentencing & Punishment of Offenders Bill on Thursday 14^th July.

LORD JUSTICE JACKSON’S CFA PROPOSALS TO PROCEED

The Government has announced its intention to follow Lord Justice Jackson’s proposed reforms to Conditional Fee Agreements (CFA), otherwise known as “no win, no fee”, for Clinical Negligence Claims.

Read the Government’s full response here.

The reforms to the CFA and After the Event insurance (ATE) regimes will no doubt affect how Claimants proceed with their Clinical Negligence claims, as lawyers will need to re-evaluate best practice for funding and running such cases.

Over 600 formal responses were received by the Ministry of Justice in reply to the consultation.  AvMA’s response can be found here.

As a result, the Government intends to implement all of Lord Justice Jackson’s major proposals and anticipates this to be in or around autumn 2012 after receiving assent.

The main changes to the present ‘no win, no fee’ arrangements are:

1. When successful in their claim, Claimants will pay their solicitors a success fee, which is a percentage mark-up on the solicitor’s basic charges.  The solicitor’s success fee will be taken out of the Claimant’s damages.  At present the success fee is paid by the losing party.

2. Premiums for ATE insurance policies, which are taken out to protect the Claimant against paying the Defendant’s costs should they lose their case, will no longer be paid by the loser (the Defendant) at the end of the case.

3. General damages (that is money for pain and suffering endured, which does not include any pecuniary loss flowing from the injury) will be increased by 10% to help Claimants cover the cost of their success fees and insurance premiums mentioned above.

4. No more than 25% of a Claimant’s general damages and past losses can be used to pay the Claimant’s solicitor’s success fee and the Claimant’s insurance policy premium.  This does not include future losses, which are protected from such a deduction.

5. Qualified One Way Costs Shifting (QOCS) is to be introduced.  This means that if a Claimant loses a case brought against a doctor or hospital, under certain (qualified) circumstances, the usual rule that the loser pays the winner’s costs will not apply.  The Claimant will not have to pay the Defendant’s costs.  It is not entirely clear when a Claimant will not have the benefit of this protection, although the government has said it would be when a Claimant was conspicuously wealthy or when there is some misconduct on the Claimant’s part.

6. There will be a new test of proportionality in costs assessment.  Only reasonable and proportionate cost may be recovered from the losing party.

7. There will be a change to the prescribed rates of which successful litigants in person can recover.

8. There will be a change to the rules governing offers to settle (called Part 36 offers).  The aim is to have equally effective incentives for Claimants and Defendants to make and accept reasonable offers to settle.  The changes aim to make it very clear whether the damages finally awarded to a Claimant at Court are better or worse than the previous offer to settle made.  There will be financial penalties imposed on the party by the Court if it sees one party as having unreasonably prolonged the litigation by not accepting an earlier offer.

The Government’s response was announced alongside a new consultation to streamline the current Civil Justice system in England and Wales.  Read the consultation document here.  Seemingly focusing on lower value claims, the key aims identified by this new consultation are raised to address and encourage:

1.      Proportionality – disputes be resolved in the most appropriate forum to drive down costs in non-complex issues

2.      Personal responsibility – the general public to take responsibility for resolving their own disputes in non-complex issues

3.      Streamlined procedure – timely justice provided in a “user” friendly manner

4.      Transparency – clear information provided on dispute resolution options available

This consultation is open until 30 June 2011.

JUDICIARY SLAMS PROPOSED CUTS TO LEGAL AID

Report predicts ‘inevitable’ decline in quality of justice and an overloaded Court system for Clinical Negligence cases

Read the full report here

The report of the Judges’ Subcommittee states candidly that removal of Clinical Negligence from Scope “does not appear… justified” (para 37). 

It importantly notes the plight of the Claimant should these proposals come to fruition by reminding that the proposals will cause “potential injustice for a small group of highly vulnerable Claimants if the present proposal is implemented” (para 47).

The report’s conclusions, echoing those of AvMA’s consultation response, assert that the current proposals will compromise access to justice for those that need it most.  It emphasises that “victims of clinical negligence are almost always the vulnerable, from the unborn child to those who are physically or mentally ill or infirm and whose vulnerability is usually the reason for the medical intervention.” (para 38)

The most notable concern is the expected rise in the Litigant in Person triggered by the axing of Legal Aid.  With this means of funding no longer available, it is anticipated that solicitors will be unable to take on many of these clinical negligence cases, as firms will find themselves unable to fund the high disbursements associated with this complex area of law.

Paragraph 43 of the report remarks, “Given the hefty front loading of financial outlay to assemble the necessary expert evidence to support clinical negligence claims, as well as the high cost of legal expertise … to pursue litigation,it must be highly questionable whether there is any other ‘viable’ alternative to legal aid.”

With no such viable funding alternative, particularly bearing in mind the potential double-whammy consequences of the proposed Jackson CFA reforms, Claimants will be forced to represent themselves leading to a host of foreseeable problems, according to the Subcommittee. 

Paragraph 38 of the report explains the problem with this, “as a result of the many special features of clinical negligence litigation, a separate body of legal principles and practice has developed over the last fifty years or so, leading to what is now sophisticated and complex litigation, quite beyond the ability of anyone to pursue as a Litigant in Person.”

The report comments that the increase in the number of Litigants in Person will lead to, not only an ‘inevitable’ decline in quality of justice, but also, an overloading of the Court system. 

In fact, it is ostensible that the court system will slow down to such an extent that in the long-run, it could cost the government more money than the current system of Legal Aid, seemingly subverting the point of the proposals!

The report further justifies its concern about the potential cost that will be created if Legal Aid is abandoned, by highlighting the fact that, “Fewer than 1% of all solicitors are able to represent Claimants in clinical negligence litigation under the system of legal aid franchising.  Those that do are, consequently, responsible and highly specialist practitioners who are unlikely to waste public funds on hopeless claims.”(Para 40)

The report reiterates that currently there is no other viable or proposed alternative for funding claims which would currently fall in Scope.  The Subcommittee reminds that the NHS Redress Act 2006 is not yet in force and warns that in any event this Act will only serve to cater for low value claims.  It will not serve to fill the access to justice gap left by the removal of Legal Aid funding.

Read AvMA’s response to the Consultation. 

 

Please sign here if you wish to show your support for petition to the government urging them to reconsider proposed changes to both the current Legal Aid system and CFA.