Lawyers set to agree pre-issue fixed fees

The 'big tent' working party investigating the case for fixed fees is moving towards consensus on a scheme for cases which settle pre-issue - but tensions appear to be still rising between the sides.

'Big tent' delegates working in sub-groups with the Civil Justice Council's predictable costs working party (as fixed fees are now called) have come up with five possible models for fixed fees, as reported in the Gazette's sister publication Litigation Funding's October issue.

The groups' views indicate that delegates still disagree strongly on the nature of the problem in costs cases.

However, there is consensus forming around one of the models which envisages fixed fees in cases which settle pre-issue.

The scheme would apply to road traffic cases that settle for 10,000 or less, although three members of the group preferred a top end of 5,000.

There would be strict time limits for compliance with key steps of the settlement process.

Costs would be assessed according to the stage at which the case was settled, and fixed in bands of 2,500 according to the value of the settled claim.

There would be guideline disbursements, success fees and insurance premiums.

If the claimant accepted the guideline costs, they would be paid without dispute and within 14 days.

It has been cast as an opt-in scheme which would attract solicitors on both sides because of the speed and certainty offered.

The claimant could opt out and request a part 8 assessment; if costs are then assessed at less than the guideline costs, the claimant would have to pay the defendant's costs of assessment.

David Marshall, vice-president of the Association of Personal Injury Lawyers, which has reservations about fixed fees post-issue, said most claimant lawyers would accept such a scheme, and then review the situation in a year or two.

Tim Wallis, president of the Forum of Insurance Lawyers, said this model was 'going in the right direction', but did not go far enough.

FOIL wants fixed fees post-issue, as envisaged by Lord Woolf in Access to Justice, and solicitors' approach to litigation to change.

Mr Wallis said defendant solicitors have accepted fixed fees from their clients, and changed their working methods and used IT to accommodate them.

Claimant firms which have similarly changed have done so just to increase profits, he argued.

While he saw some merit in piloting fixed fees through the pre-issue scheme, Mr Wallis said there would also need to be a timetable for introducing fixed fees for post-issue.

Professor John Peysner, who chairs the working party, said that while he wants a system that would cover pre and post-issue, he would not be disappointed by the development of just a pre-issue scheme given the number of cases settling at that stage.

He said it would still affect what happened post-issue.

He has suggested that any pilot that comes out of the big tent should be time-limited and only continue if all parties agree.

Some claimant lawyers involved in the big tent - such as trade union firm Thompsons - are becoming more prominent in voicing their concerns, which centre around fears that a decision to introduce fixed fees has already been taken.

Prof Peysner said: 'I don't think any such decision has been taken.'

The last CJC meeting also saw presentations from Prof Peysner and others about trips to other jurisdictions with fixed costs, such as Northern Ireland and Germany.

He said: 'Once these systems start to run, people find it reduces the hassle factor so long as the rates are right and are properly reviewed.' The Northern Ireland system, for example, has suffered from the rates not being reviewed.

The big tent was set up in December 2001 with the aim of reporting a year later.

Slippage in this timetable now seems inevitable.

LINKS: www.civiljusticecouncil.gov.uk Includes full details of the five models (Group E's is the pre-issue model)

Neil Rose