INSTRUMENTS OF INTEREST |
DRAFT CIVIL LEGAL AID (COSTS) REGULATIONS 2013 AND
5 ASSOCIATED INSTRUMENTS
18. These Regulations all amend different aspects
of legal costs in civil law cases to implement provisions of the
Legal Aid, Sentencing and Punishment of Offenders Act 2012 and
the recommendations made by Lord
Justice Jackson in his Review
of Civil Litigation Costs.
19. The draft Civil
Legal Aid (Costs) Regulations 2013
make provision about costs orders in civil proceedings in favour
of or against a legally aided party and, in certain circumstances,
against the Lord Chancellor. To improve the assessment of means-testing
the draft Legal Aid (Information about Financial Resources)
Regulations 2013 give the Director of Legal Aid Casework the
power to request information from Department for Work and Pensions,
Her Majesty's Revenue & Customs and Northern Ireland Departments
about an applicant's income and from other Departments about any
benefits that the person may be receiving.
20. Further instruments reform the way in which
conditional fee agreements (CFA) and "after the event"
insurance operate. In
his Review, Lord Justice Jackson recommended that "after
the event" insurance premiums should not continue
to be recoverable under costs orders in any area of civil litigation
- however the Recovery of Costs Insurance Premiums in Clinical
Negligence Proceedings Regulations 2013 (SI 2013/92) make
a limited exception for expert reports establishing liability
and causation in clinical negligence cases only. Lord Justice
Jackson further argued that the current "no win, no fee"
CFA regime had led to excessive costs in civil litigation with
riskfree litigation for claimants and additional costs
being paid by defendants, including a "success fee"
of up to 100% on top of the claimant's lawyer's base costs. He
therefore recommended that recoverability of the success fee from
the losing side should be abolished in all categories of civil
litigation, and that, in personal injury claims, the success fee
should be limited to 25% of damages awarded (excluding damages
awarded for future care and loss). The draft Conditional Fee
Agreements Order 2013 implements this cap. The draft Damages-Based
Agreements Regulations 2013 set a similar cap so that the
lawyers' fee is limited to 25% in personal injury claims (excluding
damages awarded for future care and loss) and 50% of the damages
for other civil litigation. The employment provisions - a cap
of 35% of the damages recovered by the claimant - have been replicated
from previous regulations.
21. Lord Justice Jackson also considered that
the current regime did not provide sufficient incentive for defendants
to settle claims. The Offers to Settle in Civil Proceedings
Order 2013 (SI 2013/93) makes provision for the court to order
a defendant to pay an additional sanction of up to 10% of the
award in cases where the defendant has refused a claimant's offer
to settle the claim and the court subsequently gives judgement
in favour of the claimant which is at least as advantageous as
the claimant's offer.
5 Reforming Civil Litigation Funding and Costs in England and Wales - Implementation of Lord Justice Jackson's Recommendations: The Government Response
March 2011 (Cmd 8041) Back
After the Event (ATE) insurance is taken out after an actionable
event has occurred to protect the claimant from having to pay
certain legal costs. It has often been used in conjunction with
"no win, no fee" agreements.