New proposals to limit costs in defamation proceedings were published today by the Ministry of Justice. Mandatory cost-capping and limiting recoverable hourly rates are both being considered. The development comes amid mounting concern about the high cost of legal fees in defamation cases.

Justice minister Bridget Prentice said: ‘Excessive costs and their threat may force defendants to settle unwarranted claims. The aim of these proposals is to bring more effective cost control to litigation in defamation proceedings and to ensure that costs in this area are more proportionate and reasonable.

‘We need to ensure that people's right to freedom of expression is not infringed, and media organisations continue to report on matters of public concern.’

Measures under consideration are:Prentice said the consultation is aimed at: lawyers who conduct litigation in the area of defamation; media organisations; and insurers.

  • Limiting recoverable hourly rates by setting either maximum or fixed recoverable rates;
  • Mandatory cost-capping or mandatory consideration of cost-capping in every case; and
  • Requiring the proportionality of total costs to be considered on cost assessments conducted by the court.

Some 220 defamation cases are issued in the High Court each year. However, the MoJ was unable to ascertain either the total number of proceedings issued or the number of defamation claims settled before court proceedings are issued. It estimates that there about 300 such claims a year.

Any reforms would be implemented through amendments to the Civil Procedure Rules Practice Directions and protocols. ‘Legal representatives and clients, in particular those using CFAs in such cases, should find the process more transparent and be able to make better informed decisions about the likely costs of the case early in the proceedings,’ the MoJ added.

Law Society director of legal policy Mark Stobbs commented: ‘The Law Society will look closely at the consultation paper. However, it is concerned that the government is listening too closely to a single vested interest. Strong mechanisms already exist to address whether costs are appropriate and the media and their insurers are well able to assess the merits of any case against them at an early stage. The issue of costs should not be used as a cloak to hide the media's concern about the law on defamation generally. Clearly costs should be proportionate, but they must enable claimants to bring appropriate claims. Any changes should not make it more difficult for legitimate claims to be brought.’

www.justice.gov.uk/publications/controlling-costs-in-defamation-proceedings.htm