Clin neg: cost of fixed fees

Fixed fees for clinical negligence claims will not be introduced on 1 October as originally planned. As I write, there has yet to be proper consultation. The lord chancellor may also have other things on his mind.

The delay may be welcomed by most practitioners in the area, but the issue is not likely to be placed permanently on the back-burner. Ensuring lawyers continue to be paid significant fees from the NHS budget is an unlikely vote-winner – although if the side of the Brexit campaign bus was to be believed, a mere four weeks of additional ex-EU funds would have covered the whole year’s budget for legal fees.

Practitioners must be properly consulted, although it is questionable whether the Department of Health should control the consultation when it is effectively the defendant to most clinical negligence claims. Practitioners also need to prepare for any changes, but it will be impossible to carry out business modelling until any proposed fixed fees have been set.

There may be a certain inevitability that fixed fees will be introduced, but not before the results of meaningful consultation and a proper review of the Legal Aid, Sentencing and Punishment of Offenders Act changes. Unfortunately, because of the under-resourced court service, the impact of costs budgeting on clinical negligence claims will not have the full extent of data that would otherwise have been expected. Costs budgeting has given courts the opportunity to bring a greater degree of control of costs. It is important we know what effect that has had.

There is an argument that fixed fees are not needed to control costs if the courts apply rigorously the disciplines of costs budgeting and the new proportionality test on assessment. The decision of the senior costs judge in BNM v MGN Ltd [2016] EWHC B13 makes clear that costs can be reduced to a fraction of the reasonable or necessary costs by applying the new proportionality test. Practitioners may feel fixed costs would be preferable to what some have described as an arbitrary swinging of the proportionality axe. In that case, the reasonably assessed costs were reduced by half, applying proportionality.

Lord Justice Jackson is a keen advocate of fixed fees for claims generally. He has expressed concern at the introduction of fixed fees for clinical negligence claims, preferring to see fixed fees across the board, rather than what he referred to as the ‘Balkanisation’ of fees for different types of claim. Surely this in itself demonstrates why fixed fees are unsuitable for clinical negligence claims or for claims generally?

If fixed fees are introduced for all claims of whatever nature up to, say, £250,000, there may be no proper comparison between the amount of work required to properly investigate a clinical negligence claim and, say, a claim for £250,000 payable under a commercial guarantee. Fixed fees across the board pay no regard to the amount of work actually involved and are an incentive to carry out work as efficiently as possible – some might say as cheaply as possible with unqualified or under-qualified staff – a prospect particularly worrying in the specialist area of clinical negligence claims.  

Some have argued that complex cases should be excluded from a fixed- fees regime. But how to define a complex case? The level of likely damages does not necessarily indicate the complexity of the matter. Factual and legal complexities need not be proportional to the damages claimed.

Whether firms will wish to continue to offer a specialist service in relation to clinical negligence claims under a fixed fees regime will obviously depend on the level at which such fees are set. If this makes the bringing of claims uneconomic from the lawyer’s perspective, then this will result in the public being denied access to justice. A claim involving the death of an elderly relative or a child may result in relatively modest damages, but the importance to the grieving relative may be immeasurable.

Many clinical negligence practitioners are concerned that, despite certain public declarations, the NHS Litigation Authority is itself a cause of unnecessary legal costs. There often remain considerable delays in admitting liability and, understandably, unlike more commercial matters, admissions and settlement of claims on a commercial basis may be anathema to the medical professional involved. Clinical negligence claims may involve considerable emotion on both sides, certainly far more than a claim for a similar sum in relation to the supply of defective widgets. If fixed fees are introduced there is concern that there will be no real incentive for the NHSLA to reach earlier settlements.

The NHLSA would know its maximum liability – a sum likely to be substantially less than it has potentially faced to date. Fixed fees and their proportionality require both sides to adopt more cooperative approaches to resolving disputes.

We are also likely to see yet more litigants in person before the courts, taking up a disproportionate amount of court time and of a judge’s patience. The claim will be one in which they will be emotionally involved and one a specialist lawyer could well have explained was unlikely to succeed and could therefore have been weeded out.

It is stating the obvious, but clinical negligence claims are brought because a medical practitioner has fallen below the reasonable standard expected of them. Reduce the number of mistakes in hospitals and claims numbers will reduce, as will the amount the NHS spends on investigating them. Legal fees are a drain on NHS resources but the public should be entitled to seek redress for negligent treatment and its consequences. Claims can serve to improve healthcare standards in our hospitals and surgeries. The negligent and poor practitioner may have to answer for their inadequacies.

As so often, the intentions behind these proposed changes may appear laudable to the public – but the unintended consequences can be grave.

PJ Kirby QC, Hardwicke Chambers