New rules on the application of the Jackson civil litigation reforms to claims on behalf of infants are likely to be published at the turn of the year.
Since April 2013 when the reforms came in to force, claimant lawyers have flagged up the trend of judges refusing to allow payments out of infant settlement damages for additional liabilities.
The Jackson reforms were intended to remove the recoverability of success fee and ATE premiums and instead have these costs met by the client. The payment out of the damages to the claimant’s solicitors can be up to 25%.
District judges say it is increasingly common for requests to be made for payment from the settlement fund to provide indemnity for the infant claimant’s litigation friend.
The Civil Procedure Rule Committee announced in May that it would consider amendments to the rule, and a spokesperson has now confirmed they are likely to be included in the scheduled update for December or January 2015.
A Ministry of Justice spokesman said: ‘We have carried out major reforms to bring balance to the system and reduce the excessive costs which were being generated in civil litigation. Ensuring that claimants’ damages are protected was a key consideration when the system was changed and we continue to monitor the impact.’
Martin McGann, solicitor-advocate at London firm LPC Law, told Litigation Funding magazine in June that the new regime was having a detrimental effect on the child personal injury sector.
When judges refuse to allow payments from damages costs are effectively being met by the claimant’s solicitors, he said. ‘Where payment of additional liabilities is refused, the only other – unpalatable – option for solicitors will be to take an action against the litigation friend personally for the sums due. Such potential liability of litigation friends is highly undesirable, and unnecessary.’
John Spencer, president of the Association of Personal Injury Lawyers, said the amendments would be a 'welcome solution' for members who have faced problems with the new regime.
'Several district judges failed to implement the rule changes introduced last April which allowed the deduction of success fees and ATE premiums from infant claims.
'This led to APIL members not being paid properly for their work in the cases and raised the dangerous possibility of firms considering the financial viability of future infant cases in the affected courts.'