Legal Aid, Sentencing and Punishment of Offenders Bill

MEMORANDUM SUBMITTED BY NATIONAL ACCIDENT HELPLINE (LA 60)

This document is a short briefing on National Accident Helpline and our views on how the Legal Aid, Sentencing and Punishment of Offenders Bill will affect consumers and access to justice.

Introduction to National Accident Helpline

1. National Accident Helpline (NAH) is the UK’s leading free advisory service for people who have suffered a non-fault injury as a result of an accident. We help these people seek redress to aid their recovery, through our national solicitor network. National Accident Helpline is authorised by the Ministry of Justice in respect of regulated claims management activities and is a registered company, incorporated in the UK.

2. NAH was formed in 1993, in advance of both the introduction of conditional fee arrangements and the Access to Justice Act. We were formed by a group of solicitors who saw the advantages of pooling resources and advertising through a national brand – NAH – to help people frightened of approaching solicitors directly to obtain advice and, where appropriate, pursue their rights to claim for personal injuries suffered by them.

3. NAH is made up of a network of 108 specialist solicitor firms, our panel members, from across the country and is highly regarded across the industry. We have panel firms in England, Scotland, Wales and Northern Ireland. Our panel members pool resources to advertise as a gateway for thousands of personal injury victims who are seeking an entry point into the legal system.

NAH business model and how we work

4. The NAH model is significantly different to arrangements that operate in other areas of the personal injury market and that involve referral fees. The NAH model is a pooled marketing model, rather than a referral model. Indeed, this distinction was recognised when NAH was established in 1993 at a time when referral fees were not permitted in the legal system. The Law Society recognised that the NAH model did not involve referral fees and that our pooled marketing arrangements do not constitute a referral fee arrangement.

5. During 2010 NAH received around 195,000 enquiries from consumers who are injured in accidents and who want advice and help on what to do. Our call centre staff are legally trained. They take the initial enquiries and filter out spurious and weak claims and then pass the enquiry to one of our panel members who have a geographic or specialism link to the consumer. The centralised NAH call centre filters out around 130,000 of those enquiries (those unlikely to have a legitimate claim to pursue) and refers around 60,000-65,000 people with their consent to one of NAH’s specialist personal injury panel member solicitors. The call centre ensures that the consumer is made fully aware of the way in which NAH works with our panel solicitors.

THE PRINCIPLES OF JUSTICE IN PERSONAL INJURY CASES

6. Our response to the Bill Committee is based around nine principles of justice in personal injury and clinical negligence cases, which we believe are commonly accepted by stakeholders and indeed expected by consumers. These principles, listed below, are fundamental in order to ensure a fair and just system is in place. It is our view that any changes proposed for reform of civil litigation funding and costs should not contravene any of these principles. We hope that the Public Bill Committee will be mindful of these principles in all of its considerations of Bill amendments and throughout the legislative process.

NAH’s view of the Legal Aid , Sentencing and Punishment of Offenders Bill

7. National Accident Helpline is most concerned with the aspects of the Bill which were taken from proposals presented to the Government by Lord Justice Jackson regarding changes to the civil litigation system, which can be found in Part 2 of the Bill, under ‘Litigation and costs’.

A number of key issues in the Bill which will affect National Accident Helpline’s customers are devolved to the Lord Chancellor for interpretation. Therefore, it is difficult to comment on how these issues will affect NAH and our consumers without knowing the exact detail of what will be implemented.

8. The issues which have particular resonance for NAH’s customers are listed below:

· s.41(2) (4B) on Conditional Fee Arrangements: This clause states that the Lord Chancellor decides the cap on the success fee and the damages it can relate to. We believe that Conditional Fee Arrangements (CFAs) exist in order to provide access to justice for those who cannot afford to pursue litigation and who are not eligible for public funding. Therefore any changes to this system must still protect those most vulnerable. Lord Justice Jackson proposed a 10% uplift on damages to mitigate against the unfairness to injured people caused by ending recoverability of success fees from the paying party. This proposal is not contained within the Bill and the absence of this provision is of grave concern. To reduce the devastating impact of these proposals on accident victims a significant uplift on all personal injury damages is required as recommended by Law Commission report 257.

· s.41(4) ends recoverability of success fees: We oppose this clause, which ends recoverability of success fees. The clause puts an end to full compensation to those who most need and deserve it, creating significant access to justice gaps and incentivising obstructive behaviour by defendants. The purpose of the recoverability of success fees is to enable good access to justice and to ensure that the claimant’s ability to gain redress is not reduced in any way by the legal process. This clause will lead to a denial of access to Justice for thousands of deserving claimants injured in accidents.

· s.42 (1) – (5) on Damages-based Agreements: This section legalises US style contingency fee arrangements and allows prescribed bodies to take a "cut "of any damages.

· s.43 (1) on Recovery of Insurance premiums by way of costs: This clause ends recoverability of after the event insurance premiums, except in circumstances prescribed by the Lord Chancellor. This is an entirely unacceptable proposal and contravenes Principles 1, 2, 3 and 9 of the principles set out above. If recoverability is ended the categories of exempt cases described at s.43 (2) requires significant extension to protect those most vulnerable. Lord Justice Jackson’s solution to the huge access to Justice gap created by this section was a flawed mechanism known as qualified one way cost shifting. The Bill makes no reference to this provision and until the relevant secondary legislation is drafted it is impossible to fully quantify the devastating effect of this proposal on access to justice.

9. All of the above points have the potential to greatly affect access to justice for NAH’s consumers. As the Bill itself does not give the specifics of how these changes will be applied, as the Lord Chancellor will make the final decisions, it is extremely difficult to state exactly how consumers will be affected although it is obvious that these proposals will have a significant detrimental impact on accident victims.

10. From our analysis of previous statements and comments from Ministers, it does appear that the Government’s intention will be to draw up the secondary legislation in such a way that it will make it substantially harder for people who have suffered an accident, through another’s fault, to access justice and achieve full restitution.

11. We believe that the Bill should be amended to ensure that this restriction of access to justice does not take place. This would be best served by removing all of Part 2 from the face of the Bill.

SUMMARY

12. National Accident Helpline is concerned that specific details of how this legislation will be applied in practice are devolved to the Lord Chancellor, making it impossible for us to assess the full effect of this legislation on access to justice.

13. However, we are very concerned that the Bill as currently drafted will dramatically impinge upon the ability of innocent people who have been injured, through the fault of another, to obtain justice and restitution for the harm that is done to them.

14. National Accident Helpline believes that the ‘9 principles of justice in personal injury cases’ should be followed by the Public Bill Committee during the shaping process of this legislation. This is fundamental in order to ensure a fair and just system is in place.

August 2011

Prepared 7th September 2011