Paul Evans of AXA tweeted recently in support of the government’s proposals for reduced portal and fixed fees: ‘Stripping out lawyers... obscene profits for whiplash claims will lead to lower premiums - good news for honest drivers.’
Leaving aside the reference to ‘obscene profits’ - and the implication in that statement that drivers who do claim are necessarily dishonest - how are the victims of other types of accidents going to benefit from the risible fee levels proposed, for the government plans to slash fees not only for road traffic accident portal work, but across the board for all claims (with some exceptions) with a value of less than £25,000.
Members of the public unlucky enough to suffer injury due to another’s negligence post-April 2013 are at risk of being unable to secure representation. Lawyers will no longer be making the decision whether or not to accept instructions purely on the basis of whether a claim has merit, but will be forced to consider whether a case is worth taking on economic grounds.
The government suggests that solicitors can offset the reduced income by not paying referral fees. Firstly, some of us never did and secondly, all of us have to budget for marketing, however we choose to do it. There is no provision for this in the fee levels proposed. What other businesses can we think of where marketing is not expected to form part of the business plan?
If solicitors cannot take on lower-value claims because it will be uneconomic for them to do so, for example, when it will cost them more in time than they stand to recover in fees, then of course someone else can. There is after all no monopoly on brains.
Even the cleverest people, however, still need training. A case valued at less than £25,000 is certainly capable of throwing up legal issues on liability, quantum and causation which are not easily grasped.
The risks are twofold; a) some people never find a solicitor or claims-handler willing to take on the case where liability is not clear cut, andb) many of those who do then have their claims under-settled by unskilled claims processors.
There is a very real risk of job losses within the legal sector, but the net result to the public, we say, will also be overwhelmingly negative. This helps no one. No one likes a cheat. If claimant and defendant practitioners agreed to work together we could all stamp out fraud.
As it is all of us - claimant solicitors, defendant solicitors and members of the public - stand to suffer from the repercussions.
Julie Carlisle is an associate at Henmans LLP, specialising in personal injury work