Civil litigation reforms implemented last year pose a risk of injustice to clients and a serious reputational risk for solicitors, the Law Society has said.
In a scathing response to the Civil Justice Council’s consultation on the first year of the Jackson reforms, the Society said changes have proved inconsistent, time-consuming and costly.
Members have experienced difficulty in getting clients to authorise agreements of budgets and in some cases a ‘lack of interest’ from the judiciary in budgeting at costs management conferences, it says.
Its response has come as one law firm, PI specialist Thompsons, said the reforms have created a ‘climate of fear’ and made cross-party agreements more difficult.
The Society said a number of firms may be at risk of claims for negligence in the light of sanctions imposed for failure to comply and there is a ‘significant danger’ indemnity insurance premiums will increase for all firms this year.
Other causes for concern are that courts now place administration over access to justice, an increased risk of satellite litigation and damage to the UK’s reputation for international dispute resolution.
The Society said: ‘The climate of litigation has changed. Co-operation between solicitors on opposing sides is breaking down as no one can trust anyone not to take the slightest point.
‘It is not putting it too high to warn that the reputation of British justice for fairness is now at very serious risk indeed as a result.’
Budgeting has led to ‘significant front-loading’ of costs – both the costs of the budget process itself and because solicitors may delay issuing proceedings to avoid control by costs budgets in respect to pre-issue costs.
The Society said more case management conferences are being listed, putting considerable strain on court resources and creating delays in getting hearings. Many solicitors have also suggested that the judiciary should receive additional training in budgeting and the guidance for ‘good practice’ should be published.
Law firms are also experiencing difficulty in explaining litigation funding to clients.
The Society response adds: ‘The sheer volume of information which needs to be provided, together with the very complicated nature of that information, is completely baffling to most clients.
‘Many of those clients therefore fail to grasp the risks they may be taking and the costs which they may be liable for despite the explanations, which have to be repeated several times in many cases, by their solicitors.’
Other Jackson reforms, such as the removal of recoverability of ATE insurance premiums and success fees from defendants, and the introduction of qualified one-way costs shifting (QOCS), mean parties on all sides have reservations about the new regime.
Claimants say they are struggling to find solicitors who will undertake lower-value non-RTA claims and, in most cases where they are represented, they face paying out substantial sums in legal costs.
Defendants say they are at a disadvantage with the costs budgeting requirements in personal injury claims where QOCS applies because of the relatively small chance that they will actually recover any costs.
They also state claimant solicitors are now more likely to delay the issue of proceedings until they have everything prepared so as to comply with any subsequent timetable.
Defendants are then faced with a strict court timetable in order to prepare documents and statements and this is causing considerable concern for them and their solicitors.