Legal Aid, Sentencing and Punishment of Offenders Bill

Memorandum submitted by ARAG plc (LA 109)

This is a submission by ARAG plc to the Public Bill Committee which is scrutinising the Legal Aid Sentencing and Punishment of Offenders Bill.

1. Introduction

1.1 ARAG group, based in Dusseldorf, Germany, has been operating for over 75 years and is the second largest legal protection insurer in the world, employing over 3500 staff in 14 countries, ARAG plc set up in the UK in 2006 and has rapidly grown to become a major player in the UK legal expenses market. It now insures over 1,000,000 motorists, 500,000 households and 100,000 businesses in addition to issuing over 25,000 ATE (after the event) policies per annum.

1.2 ARAG products protect individuals and businesses against paying legal costs and expenses arising from various types of legal disputes, such as – employment disputes, contractual disputes, pursuit of personal injury claims and nuisance & trespass claims. Cover is also available to fund defence of criminal prosecutions arising from the insured’s employment, motoring offences and, under particular arrangements - to defend members of affinity groups in relation to their activities in connection with that group. Where insured wishes to plead not guilty there must be a reasonable prospect that the court will accept that plea.

2 The Legal Aid Sentencing and Punishment of Offenders Bill

2.1 The Legal Aid Sentencing and Punishment of Offenders Bill SCHEDULE 6 COSTS IN CRIMINAL CASES amends PART 1 of the Prosecution of Offences Act 1985, section 16 so as to delete section 16(2); which makes provision that in respect of cases tried by the Crown Court where the accused is tried on indictment and acquitted on any count in the indictment they may apply for a defendant’s costs order.

2.2 If correctly understood this amendment means that individuals, who are presumed innocent until proven guilty and who subsequently are proven innocent beyond reasonable doubt by trial, at Crown Court will, unless they are eligible for public funding, have to fund the cost of their own defence at trial.

3 Case studies

3.1 Below are three case studies of trials of an extremely serious nature. If the above amendment is passed into law the defendants in these cases would not in the future be able to recover the costs of their defence. There is a significant risk of miscarriages of justice in relation to cases of this nature if innocent individuals. Some individuals are exposed to false accusations being made because of the nature of a position they hold. These individuals would be unable to fund substantial defence costs that arise from complex and sensitive cases.

3.2 The cases below were funded by legal expenses insurance. The withdrawal of cost recovery would make such insurance unobtainable in the future.

3.2.1 Case 1

C is a former foster carer . In June 2010 C was arrested and charged on 13 accounts, for mainly rape and indecent assault on a female under the age of 16, who was formally in his care from 2001. The complainant alleged the sexual abuse started before her 14th birthday.  A solicitor was appointed to represent C's defence. It was established that there were reasonable prospects of successfully defending C.  

This was a very complex case with extremely serious allegations and ultimately led to a ten day trial which Counsel was required to attend. Due to the grave nature of the charges and the complexities involved with a case such as this costs were estimated at £70,000 plus VAT.

C was acquitted on all accounts and to date we have recovered in the region of £30,000 from Central Funds, we are expecting to receive the remainder of the outstanding costs in the very near future.

3.2.2 Case 2

B received a summons from the Police regarding an accident where it was asserted that she had left the scene without giving her details to the third party. B did not recall the accident nor did she have any damage to her vehicle which one would expect if involved in an accident. She pleaded not guilty and was successful. All of the solicitor’s costs were recovered from Central Funds.

3.2.3 Case 3

T was charged with assault in June 2011. However in October the Criminal Prosecution Service decided they did not have enough evidence to support the charges, therefore the case has been discontinued. A costs order will now be sought from Central Funds to recover all of the costs incurred to date which is around £7,000.

4. Conclusion

4.1 In view of the obvious risk of; at worse miscarriage of justice and at best significant personal financial loss resulting, if individuals such as those in the case studies above were either unable to afford legal representation or did so bearing significant costs themselves; we would implore the Scrutiny Committee to retain PART 1 of the Prosecution of Offences Act 1985, section 16(2) as it stands.

October 2011