Jackson hints on ending recoverability of success fees
Lord Justice Jackson has given his clearest hint yet that he is minded to end the recoverability of success fees when he makes his final recommendations to reform civil litigation costs.
Speaking at the Sweet & Maxwell conditional fee agreement conference last week, Jackson asked for help in calculating the level to which general damages would have to increase to compensate for ending recoverability and returning to the old 25% cap on the amount of damages a lawyer could take.
Barrister Alexander Hutton of Hailsham Chambers estimated that damages would have to double at least, given the high level of costs in personal injury (PI) cases as they approach trial.
Delegates said that they would be unhappy about taking a portion of damages from injured clients, an argument Jackson acknowledged.
Former defendant insurance solicitor Jason Rowley, now chief executive of 12 King’s Bench Walk, London, questioned why PI should be different from other cases, where solicitors have no problem taking a cut of damages. Leading claimant lawyer David Marshall, managing partner of south London firm Anthony Gold, said recoverability was part of the deal for removing legal aid in personal injury.
There was no opposition to the idea of ending recoverability in defamation cases, although in a straw poll delegates voted overwhelmingly to retain juries despite the costs that abolition would save.
Comments
Recoverability of success fees
Ending recoverability of success fees would certainly take much of the heat out of the "Costs Wars". Whether the doubling of damages is a price worth paying is another issue.
It was known as "clawback"
It was known as "clawback" for a reason. Clients will hate this, and will try to settle their claims directly with the Defendant Insurers, rather than instructing a solicitor.
Recoverability of success fees
Today's success fees are out of control and ending their recoverability would reduce the amounts claimed because they would have to be justified to the client. The original CFA format (that replaced legal aid) capped the fee at 25% of the damages. Why was that cap removed when recoverability was introduced? To say damages would have to increase by at least 50% if the recoverability of success fees was ended because of the 'high level of costs in PI" is some what to miss the point of the purpose of the review!