Row overshadows new litigation era

By Jeremy Fleming

A new era in civil litigation arrived this week amidst a row over whether the costs practice direction setting out how the courts will assess conditional fee agreements (CFAs) favours claimants.

Laura Wilkin, a personal injury partner at Liverpool-based defendant firm Weightmans, said the new costs direction - implementing a key provision of the Access to Justice Act 1999 by allowing recovery of legal costs including success fees - was a 'diluted version of the government's original recommendations', and 'weighed heavily in favour of claimants'.Ms Wilkin explained that the new direction places no obligation on claimants' solicitors to disclose more than the bare minimum of details about their agreed success fees to defendants' solicitors at the start of an action.

The effect, she said, was that defendant solicitors would not be able to assess their potential costs exposure until the end of a case.

Ms Wilkin called for a pre-action protocol to discourage premature entry into CFAs by claimants' solicitors, and requiring claimants to carry out certain due diligence before entering into CFAs.Ms Wilkin said the Woolf reforms' priorities of transparency and proportionality were threatened by the direction.Frances McCarthy, president of the Association of Personal Injury Lawyers (APIL), said the practice direction was not balanced in favour of the claimant, but she acknowledged that it did not oblige comprehensive disclosure of CFAs at an early stage.

'We at APIL think there should be notification,' she said.Ms McCarthy said the absence of disclosure requirements worked against claimants' interests no less than defendants.

Claimants ran a greater risk of having their success fees disallowed if they did not disclose the details of them to the defendant, she maintained.Ms McCarthy said she is attending an APIL protocol working party this week at which she will recommend the adoption of an initial protocol letter which would disclose details of CFAs.Martin Staples, president of the Forum of Insurance Lawyers (FOIL), said: 'I acknowledge that it is unlikely that provisions for further claimants' disclosure will be made by the government.'Mr Staples said he fully endorsed APIL's move to find a solution to the problem of CFAs entered into prior to proceedings.

He hoped both FOIL and APIL could work together: 'We both understand each others difficulties.'Generally, Ms McCarthy welcomed the publication of the costs direction: 'Now that CFAs are under way, we need to be positive and try to make the new regime work for our clients.'She continued: 'I do have residual concerns that some borderline cases will find it difficult to obtain representation under the new regime.'