The criminal justice system requires a sensible resolution of the VHCC fee cut impasse.

Chris Grayling has every reason to be pleased with the courts at the moment. Just over a week ago, three judges headed by Lady Justice Hallett agreed that the justice secretary had no need to consult the public before allowing the remains of King Richard III to be reburied at Leicester Cathedral.

A couple of days earlier, Sir Brian Leveson and two other appeal judges overturned a ruling that had threatened a key part of Grayling’s legal aid reforms.

As far as Richard III is concerned, I share the judges’ hopes that their fascinating historical account – largely written, I suspect, by Mr Justice Haddon-Cave – will allow the king ‘to be given a dignified reburial and finally laid to rest’. But the same cannot be said for the appeal court’s ruling in the case of Crawley , better known as Operation Cotton.

That is a case in which five defendants are facing fraud charges. It’s alleged that sites were divided into sub-plots which were then ‘aggressively marketed to members of the public – often vulnerable members of the public – who were persuaded to buy based on false representations’. The prosecution, initiated by the Financial Conduct Authority, was stayed by Judge Leonard QC, sitting at Southwark Crown Court. If the Court of Appeal had not overturned his ruling, using powers it was given only 10 years ago, the defendants would never have faced trial.

Operation Cotton, which involves 46,000 pages of evidence and two trials lasting up to five months, was classified by the Legal Aid Agency as a ‘very high cost case’ (VHCC). Last year, the justice secretary announced that fees paid to defence counsel in such cases would be reduced by 30%. Despite the best efforts of the defendants’ solicitors, no suitably qualified advocate was prepared to sign a contract under the VHCC scheme. Everyone agreed that it would be unfair to try defendants who, through no fault of their own, could not find suitable advocates.

So the only question for Leonard was whether their trials should be deferred until next year in the hope that suitable advocates could then be found – or permanently stayed on the basis that none would be available even then. The latter argument was advanced by Alex Cameron QC (pictured), the prime minister’s brother, who appeared for the defendants without fee (or, in the judge’s felicitous typo, ‘bro bono’).

Most people would have expected the court to adjourn in the hope that something would turn up. But the judges at Southwark are a pretty independent lot. To the delight of the bar, Leonard held that granting the prosecution an adjournment ‘to put right its failure to provide the necessary resources to permit a fair trial to take place now amounts to violation of the process of this court’.

Despite predictions that the ruling would prove watertight, Leveson had little difficulty in finding that it included ‘errors of law or principle’. The Court of Appeal ordered the trial to be resumed.

But that won’t happen unless there’s a deal between the government and the bar. As Leveson said, ‘this will require effort’ – by which he must mean concessions – ‘on both sides’. Nicholas Lavender QC, chairman of the bar, and Nigel Lithman QC, chairman of the Criminal Bar Association, both offered talks to break the impasse. The justice secretary should welcome the bar’s willingness to negotiate.

Grayling’s alternative is to try to recruit more QCs to the little-known and little-respected Public Defender Service (PDS). Defendants would simply have to put up with them. But the justice secretary is well aware that self-employed advocates cost less than employed lawyers, with their salaries, allowances and pensions.

At the end of March, Grayling outlined the arrangements under which he will have to pay pensions to part-time judges – backdated, where appropriate, to April 2000.

That will no doubt cost him a fortune and make it even less likely he can restore the 30% VHCC cut.

Lavender and Lithman do not want to expand the PDS at the expense of the independent bar. On the other hand, they must fear – and Grayling may hope – that the bar’s impressive solidarity will eventually give way to economic realities: it cannot be easy for a barrister to turn down a year’s work, especially if he or she has a supportive contract manager at the Legal Aid Agency who can find creative ways of mitigating the fee cut.

This dispute is no longer about saving money; it’s about saving face. Grayling needs to come up with concessions that he can claim are no more expensive, such as paying some fees in advance. The bar’s leaders need grounds for persuading their troops back to work. As Leveson rightly says, the criminal justice system depends on a sensible resolution of these issues.


The spotlight on key players was all the brighter for the presence of TV cameras in the court, as this Sky News film of proceedings shows.

Click here to view our video feature Op Cotton: court on camera