Hot topic: Law Society plans judicial review of hike in court fees

It emerged this week that the Law Society had set the wheels in motion for a judicial review of the MoJ's proposals to hike court fees.

It emerged this week that the Law Society - with support from other representative bodies - had set the wheels in motion for a judicial review of the MoJ's proposals to hike court fees based on a percentage of the value of the claim.

We discussed this issue with Martina Hogg, Lead Compliance Consultant at Compli, as part of the '60 seconds with...' feature for this week's newsletter:

Martina, what do you think about the planned JR?

It is good to see the Law Society carrying out its representative function and standing up to the government on this. The proposed changes show little understanding of how the legal sector, and litigation in particular, works. Since there is no direct correlation between the value of a claim and the numbers of days' court time required, an issue fee of £10,000 could mean that access to justice is denied in many cases.

What could this mean for clients?

I suspect a significant number of claimants will not be in a position to fund court fees and neither will their solicitors. This means they will either have to drop their claim, settle without proceedings (possible at an under-value) or look at disbursement funding loans. I am not necessarily opposed to disbursement funding loans, but it was not that long ago that we had the scandal that was The Accident Group. Can we be certain that clients will not be exploited in the same way again?

What could this mean for solicitors?

I think, in short, it means that acting in the best interests of your client has just become even more difficult. We have already worked closely with a number of firms advising on the consequences of LASPO and QOCS, as well as non-recoverability of ATE insurance premiums and success fees. Going forward, the solicitor is going to have to get out his/her crystal ball to assess whether or not the case is likely to be settled without proceedings being issued. The cost/benefit risk assessment will become even more important at the outset with clear advice given to the client on strategy as well as cost, including the possibility of disbursement funding. Fee earners will need to be trained to ensure they can confidently discuss these issues with the client and client engagement letters will need revising to ensure compliance with Outcome 1.13 of the Code.

Ironically, by introducing QOCS and preventing claimants recovering ATE insurance premiums from the defendant, the government appeared to give a clear indication that it wished to curb the use of ATE insurance. Should disbursement funding become prevalent, the government can guarantee a shot in the arm for the ATE insurance industry; it is highly likely that any disbursement funder will require the client to take out an ATE policy."

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