Cape Town Opera in Oxford!
I am organizing on behalf of the Lord’s Taverners in association with Underwoods Solicitors a performance by Cape Town Opera at the Sheldonian Theatre in Oxford at 8.00pm on Monday 11th June 2012.
Nelson Mandela has given us permission to include spirituals, opera choruses and excerpts from the new South African opera Mandela Trilogy. The programme will also include popular arias.
All proceeds will be split equally between the Lord’s Taverners charity for disabled children and Cape Town Opera. The Opera company is performing free of charge and Underwoods Solicitors are paying for the hire of the Sheldonian, and Shurtape Limited are sponsoring the programme.
Thanks also to Perrins Solicitors, John Allen,Chris Potter, Joe Egan Solicitors and Villa Plus for sponsoring seats for students and children, and thanks to Nicholas Cleobury for help with all matters musical.
Tickets are £10 for the wooden benches, (£7.50 for students), £20, £30 and a few remaining at £50 and are available in advance of going on general sale to followers of this blog and my followers on Twitter. Contact me on 01442 430900 or email me at kerry.underwood@lawabroad.co.uk.
In a summer featuring the London Olympics and Paralympics, the Queen’s Diamond Jubilee and Euro 2012 this will be one of the great highlights, combining a truly outstanding and original Opera company with one of the loveliest theatres on the planet.
Being a fanatical Queens Park Rangers supporter I am well aware that 11th June sees England play France in Euro 2012, so we have a list of pubs within walking distance of the Sheldonian that will be showing the football. Kick-off is at 5.00pm and the game will be over by 7.00pm.
Cape Town Opera
I am very familiar with Cape Town Opera as I sit on the Board of the UK Friends of Cape Town Opera and Underwoods Solicitors deals with Cape Town Opera’s legal work free of charge in the United Kingdom and South Africa.
Archbishop Desmond Tutu says:
“The South African voice is unique, rich with colour and strength and its represents this country’s best qualities – Cape Town Opera gives to audiences…..the opportunity to experience that wonderful South African sound, what a gift”.
Click www.capetownopera.co.za for more information.
Lord’s Taverners
The Lord’s Taverners is the UK’s leading youth cricket and disability sports charity. Its mission is to give a sporting chance to those in need. Its focus is on youth cricket in disadvantaged areas and sports and recreational equipment for young people with disabilities and special needs, including sports wheelchairs, specially-adapted minibuses and sensory play areas.
Both partners of Underwoods Solicitors, Robert Males and Kerry Underwood, are active members.
Click www.lordstaverners.org
Sheldonian Theatre
Built by Christopher Wren between 1664 and 1668 the Sheldonian Theatre was opened with great ceremony in 1669, and is described in the King’s England as -“perhaps the most distinctive of all the noble buildings in the Broad”.
The interior of the theatre, with its tiers of struts and a gallery borne on wooden pillars is an impressive sight. The flat ceiling shows the Triumph of Virtues, Arts and Sciences over Envy, Hatred, and Malice with cherubs tumbling over clouds in joyful accompaniment”.
Click www.ox.ac.uk/sheldonian for more information.
Sponsorship opportunities
£75.00 buys ten seats for students/children and a mention in the souvenir programme.
£750.00 buys a full-page advert in the souvenir programme.
£1,000.00 buys co-sponsorship of the souvenir programme, including a full-page advert.
This will be a night to remember. I want the Sheldonian rocking and I want your help!
Nkosi Sikele ‘I Afrika
God Bless Africa
Kerry Underwood
CONTINGENCY FEES AND DAMAGES-BASED AGREEMENTS
CONTINGENCY FEES AND DAMAGES-BASED AGREEMENTS
The current regime
- Contingency fee agreements have always been allowed in non-contentious work. Pre-issue work is classed as non-contentious and therefore can be carried out under a contingency fee agreement.
- However once the case is issued then that pre-issue work retrospectively becomes contentious and thus the contingency fee agreed is of no effect. The solution is to enter in to a conditional fee agreement and a contingency fee agreement from Day One and to serve Form N251 on the other side.
- The agreement with the client will be that the contingency fee agreement operates until proceedings are issued at which point it drops away and the conditional fee agreement is deemed to have been in place from the beginning. This is achieved by a bridging agreement.
- Absent contractual agreement with the other side there is no right to costs pre-issue and therefore it does not matter that the conditional fee agreement is not in place. Costs are only payable by agreement; if they are agreed then there is no problem and if they are not agreed then proceedings will need to be issued at which point the conditional fee agreement comes in to force with effect from the beginning of the case.
- The potential problem is that fees on an hourly basis, even with a success fee, may be significantly less than the contingency fee would have been. That will depend upon a combination of the settlement figure and the contingency fee percentage on the one hand and the time spent and the hourly rate on the other hand.
- Thus where there is a contingency fee agreement you should have a high hourly rate in the conditional fee agreement.
- Solicitor and own client rates can and should be very much higher than the rates that you are likely to recover on a between the parties basis.
- This is for two reasons:
(i) to maximize the alternative “take” to the contingency fee; and
(ii) to maximize the indemnity costs received if, as a claimant, you match or beat your own Part 36
offer.
The Jackson Proposals
- It is now proposed to allow contingency fee agreements in all types of civil litigation, including in relation to all post-issue work including advocacy.
- Paragraph 13 of the Government’s Consultation Paper Reforming Civil Litigation Funding and Costs in England and Wales – Implementation of Lord Justice Jackson’s Recommendations reads:
Damages-based agreements (DBAs/contingency fees) will be allowed to be used in civil litigation. DBAs are another type of ‘no win no fee’ agreement, but the lawyer’s fee is related to the damages awarded, rather than the work done by the lawyer. The Government will lift the restriction on their use in civil litigation.
DBAs will provide a useful additional form of funding for claimants, for example in commercial claims. Successful claimants will recover their base costs (the lawyer’s hourly rate fee and disbursements) from defendants as for claims, whether funded under a CFA or otherwise, but in the case of a DBA, the costs recovered from the losing side would be set off against the DBA fee, reducing the amount payable by the claimant to any shortfall between the costs recovered and the DBA fee.
DBAs will be subject to similar requirements for parties to the agreement as for CFAs. For example, the amount of the payment that lawyers can take from the damages in personal injury cases will be capped (at 25% of damages excluding for further care and loss). However, the Government is not persuaded that there should be a requirement for a claimant to obtain independent legal advice in respect of a DBA.
- This has become Clause 42 of the Legal Aid, Sentencing and Punishment of Offenders Bill which I set out below and this amends Section 58AA of the Courts and Legal Services Act 1990, which was itself an amendment to formalize and regulate contingency fee agreements in employment tribunals.
- Again the devil will be in the detail.
- Note:
- contingency fee agreements are to be allowed in ALL civil litigation;
- all costs received from the other party must be deducted from the amount charged to the client
by way of a contingency fee;
- nothing is achieved that could not be achieved by an appropriate solicitor and own client rate;
except if the case is settled very early;
- in personal injury cases the contingency fee will be limited to a sum equal to 25% of damages,
with the same definition of damages as in conditional fee success fees charged to the client.
- Consequently it is hard to see any benefit for the solicitor of a contingency fee agreement over a conditional fee agreement in any case, where costs are recoverable from the other side in the event of a win.
- For the client a contingency fee agreement is likely to be more attractive than a conditional fee agreement.
- In personal injury cases contingency fees are almost entirely pointless from a solicitor’s point of view as they are subject to all of the restrictions that apply in relation to conditional fee agreements AND the solicitor has to allow a pound for pound reduction in relation to any costs received from the losing party, something that does NOT apply in relation to the conditional fee success fee.
- Furthermore the technical requirements in relation to this statutory form of contingency fee agreement rate are greater than for conditional fee agreements, which defeats the purpose of pure contingency fee agreements whose beauty is their simplicity and certainty.
- The significance of this measure is that it is a statutory recognition of contingency fees and that ends all arguments about their lawfulness, due to the doctrine of the Sovereignty of Parliament.
- With the small claims track limit rising to £10,000.00 or £15,000.00, or possibly even £25,000.00, contingency fees will have an increasing role to play as obviously they are of greater value and importance where costs are not recoverable from the other side, which obviously applies in small claims track cases.
- Contingency fees have been widely used in fields where costs are not recoverable from the other side, especially in CICA claims and in employment tribunals.
- The whole Motor Insurers’ Bureau Untraced Drivers Scheme is based on contingency fees.
- This half-hearted measure is pointless in relation to costs-bearing cases and I can envisage few cases where a Damages-Based Agreement would be appropriate, for the solicitor.
- In cases where costs do not follow the event it is a different matter.
- Pre-action contingency fee agreements have always been allowed as pre-action work is non-contentious but retrospectively becomes contentious upon issue. That will change in that contingency fees will now be allowed in respect of contentious work.
- It is not yet clear, and may not become clear, whether old-fashioned pure contingency fee agreements will continue to be allowed.
- If they are, then the answer is to have a pre-action contingency fee agreement, a bridging agreement and a conditional fee agreement that only comes in to play if proceedings are issued.
- Thus if the success fee and the contingency percentage are the same, and in personal injury work the maximum is 25% of damages excluding future loss, then:
- it is ALWAYS in the solicitor’s interest to have a conditional fee agreement as that is
costs recovered PLUS 25% of damages as a success fee;
- it is ALWAYS in the client’s interest to have a contingency fee agreement as that is 25%
LESS costs recovered from the other side.
- The 25% cap in relation to the success fee and the contingency fee “take” applies only in personal injury cases.
- All success fees remain subject to the rule that they must not exceed 100% of base costs.
- Base costs are solicitor and own client costs NOT the sum recovered from the other side on a between the parties’ basis.
- In non-personal injury cases it will be possible to construct a contingency fee agreement along the lines of “whatever fees which once the as yet unknown recovered costs are taken in to account and set off against that fee, will leave the solicitor with 25%, or 30% or whatever of damages” or to put it another way a promise that the client will get 75% or 70% or whatever of damages with the solicitor keeping the rest.
- In Employment Tribunal claims the maximum contingency fee is 35%, including VAT, which, with VAT at 20%, is a contingency fee of 29.17% plus VAT; in other words the profit costs are 29.17% of the sum recovered.
- It is presumed that the 25% maximum in personal injury cases will include VAT and that gives a profit costs figure of 20.83%.
- Any deal can be done with counsel, such as
- splitting the contingency fee 50-50;
- splitting the contingency fee in some other way;
- paying counsel win or lose and keeping all of the contingency fee in the event of a win
but paying counsel personally in the event of defeat;
- instructing counsel on a conditional fee basis.
- However generally if a contingency fee is being used it is better for the solicitors’ firm to do the advocacy itself.
Interplay with Third Party Funding
- Lord Justice Jackson appears not to understand the way funding, as opposed to costs, works.
- At present a client’s success fee is paid by the other side but the third party funder’s fee is paid by the client.
- If the client is to be the payer in any event then an informed decision needs to be made in each case between these two methods of funding.
- For example in what looks like a safe case the client may feel better off with a Third Party Funder taking 20% of any damages and agreeing to pay the solicitor in the event of defeat. The potential loser here is the solicitor who will receive no success fee but face no risk.
- These will be difficult calls and the tension between non-recoverable success fees and third party funding has not been fully considered.
- In the pre-2000, pre-recovery, days there was no third party funding and so the issue has not arisen.
- Suppose a third party funder was to advertise that it would back any viable road traffic accident case in return for 10% of damages.
- What would the solicitor’s duty then be? To limit their own success fee to 10%? To take no success fee at all?
- Lord Justice Jackson says in favour of Third Party Funding that it provides an additional means of funding litigation, “and for some parties the only means” and, unlike conditional fee agreements does so without “any additional financial burden upon opposing parties,” and that it tends “to filter out unmeritorious cases”.
- Reflecting his view that recoverability of success fees should be banned Lord Justice Jackson states that it is better for a claimant “to recover a substantial part of damages than nothing at all,” and notes, correctly, that Third Party Funding would “become even more important as a means of financing litigation if success fees under conditional fee agreements become irrecoverable.”
- Jackson also appears to accept that in the absence of the recoverability of after-the-event insurance Third Party Funding may fill the gap.
- In referring to Stone and Rolls (in Liquidation) v Moore Stephens (a Firm) [2009] UKHL 39 where the third party funded claimant lost and had not taken out after-the-event insurance to cover its adverse costs risk Lord Justice Jackson said:
- “These facts illustrate that third party funders can operate satisfactorily in the absence of ATE insurance and they can accept liability for any adverse costs orders”, adding that the risk undertaken by the funder was reflected in the percentage of damages which the funder was entitled to receive in the event of success.
- What was not addressed is the percentage of damages to be left to the successful third party funded claimant.
- Thus a clinical negligence action is third party-funded in a post-Jackson world where there is no recoverability of the success fee or after-the-event insurance premium. The third-party funder agrees to cover any adverse costs order, in other words to be the after-the-event insurer as well as the funder. In those circumstances a percentage take towards the top of the range for the third party funder would not be unreasonable – say 40% of damages. It agrees to pay a discounted fee to the solicitor in any event, that is the solicitor works under a discounted conditional fee agreement.
- The solicitor’s conditional fee agreement success fee is capped at 25% of damages.
- The claimant wins and thus gets 35% of damages awarded.
- It could in fact be rather less – there may be interest on the third party funding and some irrecoverable solicitor and own client costs.
- That is why Third Party Funding in an age of non-recoverability of success fees and after-the-event insurance premia risks a re-run of Claims Direct and the Accident Group.
Clause 42 of The Legal Aid, Sentencing and Punishment of Offenders Bill
- “42. Damages-based agreements
(1) Section 58AA of the Courts and Legal Services Act 1990 (damages-based agreements) is amended as follows.
(2) In subsection (1) omit “relates to an employment matter and”.
(3) In subsection (2)—
(a) after “But” insert “(subject to subsection (9))”, and
(b) omit “relates to an employment matter and”.
(c) Omit subsection (3)(b).
(4) After subsection (4)(a) insert—
(i) “(aa) must not relate to proceedings which by virtue of section 58A(1) and (2) cannot be the subject of an enforceable conditional fee agreement or to proceedings of a description prescribed by the Lord Chancellor;”.
(5) In subsection (4)(b), at the beginning insert “if regulations so provide,”.
(6) In subsection (4)(d) for “has provided prescribed information” substitute “has complied with such requirements (if any) as may be prescribed as to the provision of information”.
(7) After subsection (6) insert—
(i) “(6A) Rules of court may make provision with respect to the assessment of costs in proceedings where a party in whose favour a costs order is made has entered into a damages-based agreement in connection with the proceedings.”
(8) After subsection (7) insert—
(i) “(7A) In this section (and in the definitions of “advocacy services” and “litigation services” as they apply for the purposes of this section) “proceedings” includes any sort of proceedings for resolving disputes (and not just proceedings in a court), whether commenced or contemplated.”
(9) After subsection (8) insert—
(i) “(9) Where section 57 of the Solicitors Act 1974 (non-contentious business agreements between solicitor and client) applies to a damages-based agreement other than one relating to an employment matter, subsections (1) and (2) of this section do not make it unenforceable.
(10) For the purposes of subsection (9) a damages-based agreement relates to an employment matter if the matter in relation to which the services are provided is a matter that is, or could become, the subject of proceedings before an employment tribunal.”
(11) In the heading of that section omit “relating to employment matters”.
(12) The amendments made by this section do not apply in relation to an agreement entered into before this section comes into force.”
Provisional Assessment Pilot
Provisional Assessment Pilot
On 13 January 2012 Lord Justice Jackson published his report on the Provisional Assessment Pilot.
Provisional assessment is a procedure whereby the court provisionally assesses costs on paper, that is without an oral hearing, and if either party is dissatisfied it can seek an oral hearing, but will pay the costs of that exercise if it does not achieve a 20% improvement upon the provisional assessment.
The idea stems from Chapter 45 of Lord Justice Jackson’s Final Report, which recommended that such a scheme should be piloted in respect of bills up to £25,000 and since 1 October 2010 a pilot has been running in Leeds, Scarborough and York County Courts.
The report concludes that the pilot has been a success and should be rolled out nationally. The current rules are set out in Practice Direction 51E of the Civil Procedure Rules and the report suggests that these be improved in that:
(i) there should be a cap of £1,500 in relation to the costs of a provisional assessment;
(ii) when lodging documents for provisional assessment the parties should file
(a) any open offer and
(b) in a sealed envelope, any offer under CPR Part 36.
(Currently it is debatable whether the Part 36 procedure applies to detailed assessment proceedings, but it certainly will do once other Jackson-related reforms recently approved by the Rules Committee are implemented).
(iii) the Practice Direction should require any party requesting an oral hearing to specify
(a) what aspects of the provisional assessment it disputes; and
(b) a time estimate for the hearing.
(iv) the Practice Direction should require the parties to agree and then file the final costs calculation after the district judge has annotated his decision on Precedent G, with liberty to apply.
Any oral hearing will be conducted by the District Judge who made the provisional assessment on paper; an oral hearing is not an appeal but rather “a second stage of the process before the assigned district judge”.
An appeal will be to a Circuit Judge.
This reform is likely to be introduced at the same time as the other reforms stemming from the Jackson Report and the consultation on County Court reforms and the proposals contained in the Legal Aid, Sentencing and Punishment of Offenders Bill, currently limping its way through Parliament.
The target date for introduction of the reforms is now 1 April 2013 (announced in House of Lords on 30 January 2012).
Comment
This is one of the Jackson Reforms that I support. The “costs of costs” has become an Alice in Wonderland feature of English court procedure.
Indeed I would go further and extend this procedure to all bills, whatever their value. There is the safeguard of an oral hearing and an appeal to the next tier of the judiciary.
The danger is that, rightly or wrongly, High Street solicitors will see this as yet another aspect of the Jackson Report designed to put them out of business while letting his mates in the City charge what they want without the same restrictions.
That may be unfair, but trust me, that is likely to be the reaction of most solicitors given the right-wing and reactionary bias of the report and the Government’s proposals generally.
Thank you!
A big thank you to all of you who have subscribed to my blog. I have been a bit quiet on the blog front lately but will make up for it in 2012.
Rather than just saying thank you I have some treats on offer.
At Underwoods Solicitors we have Club Wembley tickets so contact me if you would like to watch a match at Wembley Stadium. Apparently not everyone likes football! So we have some other treats on offer.
By kind permission of TRH the Prince of Wales and the Duchess of Cornwall we have access to the fascinating gardens at their home, Highgrove, near Tetbury in Gloucestershire. The cost is £18.00 and the tour lasts 2 hours.
We do Cape Town Opera’s legal work. Cape Town Opera has a major tour of the UK in summer 2012. I have organized a performance at the Sheldonian Theatre, Oxford on the evening of Monday 11th June 2012 with all profits being split between The Lord’s Taverners Charity for disadvantaged children and Cape Town Opera. My company is paying for the hire of the theatre.
Just by returning the form online, you will be entered in to a draw and the 40 winners will receive their choice of two Highgrove tickets, two Cape Town Opera tickets or a cheque for £25.00.
Employment law affects most families and all businesses and so we are running a series of free seminars.
Please complete the response form by visiting http://lawabroad.co.uk/draw.htm and submit it to express interest in any of these events and to be entered into our free prize draw.
A very Merry Christmas and Happy New Year to you all!
Kerry
Kerry’s Modern English Usage
| Atlantic Bridge: | Proper noun. Local lodge for the Cabinet.
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| Bank: | Noun. Not now in polite use. Formerly an institution that lent money (archaic).
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| Cameron: | Collective noun for multi-millionaires – mainly in the Cabinet.
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| Casino: | Noun. See Bank.
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| Cat: | Noun. Technical legal term concerning Human Rights Act – see May.
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| Djanogly: | Collective noun for Claims Management Companies. Also a condition where you are Minister in charge of your family’s businesses, as in “to have the Djanoglies”.
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| Fox: | Noun. Social animal that takes its best friend to work.
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| Fox: | Verb. To treat the Cabinet like a Freemasons Lodge – just there to help your mates.
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| May: | Noun. Urban myth creator, as in anything that she says May or May not be true. Derived from Old English “to Mayke things up”.
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| Resignation: | Noun. Cure for the Djanoglies – see above.
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| Silence: | Noun. Condition affecting Labour Front Bench re referral fees, possibly connected with huge income Labour Party and Trades’ Unions receive from referral fees.
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| Straw: | Verb. To forget, especially that you were the Cabinet Minister responsible for all of the things you now attack.
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| Theft: | Noun. See Bank above.
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| Treason: | Noun. See Bank above. |
Jack Straw and referral fees
Jack Straw introduced a 10 minute rule Bill in the House of Commons on 13 September 2011 seeking to ban referral fees. The Government has adopted that Bill. Referral fees will be banned in personal injury cases and it is likely to be a criminal offence, punishable by two years imprisonment, to pay or receive or offer or solicit a referral fee in a personal injury case.
I have no problem with that. I do have a problem with Mr Straw, a Cabinet Minister for the whole of the 1997-2010 Government, and Justice Secretary and Lord Chancellor from June 2007 to 6 May 2010 suddenly discovering referral fees.
The Compensation Act 2006, which licenses Claims Management Companies (CMCs) and specifically regulates and authorizes the payment of referral fees, came in to force on 23 April 2007, just weeks before Mr Straw became Justice Secretary and Lord Chancellor. His own department, the Ministry of Justice, is responsible for licensing Claims Management Companies, and the list of such companies appears on the MoJ’s website.
Thus for most of the lifetime of regulated referral fees Mr Straw was the Minister directly responsible for them.
Yesterday, 6 October 2011, the Legal Services Act 2007, surely the most disastrous piece of legislation of the last Government, and one of the worst in the country’s history, came in to effect.
It allows all comers, subject to minimal requirements, to sell legal services. The Claims Management Companies that Mr Straw dislikes so much will become Alternative Business Structures (ABSs) (the Act’s name not mine!) and will practise law.
Thus the ban on referral fees will be utterly meaningless and irrelevant as the sellers of the work, the Claims Management Companies – will simply do the whole case themselves, or carry on selling the work to other ABSs and law firms as there has never been any restriction on payment of referral fees between lawyers.
The whole purpose of the Legal Services Act is to allow non-lawyers to compete with lawyers on a level playing field. Preventing Claims Management Companies which are ABSs from trading work in the way that solicitors can would defeat that objective.
In any event CMCs which are ABSs can instruct the solicitors that they currently sell clients to on an agency basis. Thus at present a CMC sells a client whose claim attracts costs of £1,200.00, for a £700.00 referral fee.
Now the CMC can simply instruct the solicitor on an agency basis and pay the solicitor £500.00, keeping the balance of £700.00.
Thus the CMC receives £700.00 and the solicitor £500.00, exactly as now and for doing exactly the same work.
Like Theresa May and the Human Rights Act cat, Mr Straw must know this.
The Legal Services Act 2007 received Royal Assent on 30 October 2007 at which time Mr Straw was the Lord Chancellor and the Justice Minister. He is also a barrister. Hate it or love it, everyone regards it as one of the most significant Acts ever in relation to law. It is inconceivable that Mr Straw was unaware of its consequences – its whole purpose is to allow CMCs and others to compete with lawyers.
Here is the link to Mr Straw’s speech in the House of Commons seeking leave to introduce the Bill:
http://services.parliament.uk/hansard/Commons/bydate/20110913/mainchamberdebates/part004.html
Reading this no-one would ever have any idea that it was Mr Straw’s Government that has caused all of these problems, and specifically Mr Straw himself who was the Cabinet Minister responsible when the Legal Services Act became law.
Thus Mr Straw himself has ensured that his proposed ban on referral fees is totally meaningless and irrelevant, but of course it attracts favourable comments in the Daily Mail, and uncritical publicity on the BBC’s website.
I would prefer not to be governed by people like Mr Straw and Ms May.
NHS Litigation Authority: Has it misled Parliament?
“30% rise in negligence claims against NHS” screams the Daily Telegraph headline of 5 August 2011, typical of others.
No such increase ever occurred as I will demonstrate below, so where did this figure come from?
In its report to Parliament 2010-2011 the Chief Executive, Steve Walker, a Civil Servant, leaps straight in to the political arena:
“We are delighted that the Ministry of Justice is taking forward the recommendations made by Lord Justice Jackson regarding the costs of civil litigation. We believe very strongly that a regime which allows success fees and the recoverability of After-the-Event (ATE) insurance premiums makes litigation so profitable that solicitors and so-called “claims farmers” are drawn into the market thereby fuelling the rise in claims volumes we have experienced.
After large increases in previous years we saw new claims volumes for newly reported clinical claims rise by around 30% in 2010-2011 and by around 6% for non-clinical”.
The truth is very different.
Conditional fee agreements were first allowed on 5 July 1995. According to the NHSLA’s own figures the number of claims notified in 1997/1998, when conditional fee agreements were first becoming popular in clinical negligence claims, was 6,711. By 2009/2010 the number had fallen to 6,652.
Recoverability of success fees and ATE insurance premia came in on 1 April 2000, apparently causing the explosion in claims. Yet the 2007 NHSLA report said “the number of matters we receive has remained remarkably steady over recent years. This year there was a small decrease in the number of clinical matters in 2006/2007 over 2005/2006″.
The 2008 report said: “The number of claims we receive has continued to remain remarkably steady over recent years. This year, there was an increase of less than 1% in the number of clinical claims reported”.
Between 2008 and 2009 there was an increase in clinical claims of 11.30% from 5,470 to 6,088 and between 2009 and 2010 a further increase of 9.26% from 6,088 to 6,652.
The pattern of non-clinical claims very closely follows that of clinical claims, and the percentage rises in such claims between 2007-2008 and 2008-2009 was 10.74%, up from 3,380 to 3,743 and between 2008-2009 to 2009-2010 was 8.84% up from 3,743 to 4,074. Previous years show a similar close correspondence.
2010-2011
Between 2009-2010 and 2010-2011 non-clinical claims rose from 4,074 to 4,346, an increase of 6.68%.
Another measure of activity is the figure of claims open at the year end. A big surge in new claims will result in an even bigger rise in figures because it will be the older, lower, number of claims falling out whereas the new ones are all still in. On this measure non-clinical claims showed a 7.52% rise between 2009-2010 and 2010-2011 and clinical claims showed a rise of 7.51%.
So for 2010-2011 on three measures we have rises of 6.67%, 7.52% and 7.51%.
Yet clinical claims jumped from 6,652 to 8,655, an astonishing increase of 30.1%.
Very obviously this rise has nothing to do with conditional fees or recoverability of success fees and ATE as conditional fees had been in for 15 years and recoverability for 10 years, and as we have seen claims sometimes fell during the years of recoverability.
So what DOES explain it?
Nothing, because there was no such increase.
On page 12 of the report, under “Claims Received” it says:
“Formal clinical claims received under CNST [Clinical Negligence Scheme for Trusts] saw an increase of 31.6% on 2009/2010 and non-clinical claims under LTPS [Liabilities to Third Parties Scheme] rose by 7.8%. Part of the significant increase in claims under CNST may be explained to some extent by the requirement for claimants to now send us a copy of the Letter of Claim at the same time as it is sent to the defendant NHS body, at which point we now record the claim, but we are analysing patterns and trends to obtain a better understanding of the reasons behind the increase” (My emphasis).
Thus the headline-grabbing 30% increase is pure fiction and is obviously and readily explained by a change in reporting methods.
Why did Mr Walker not mention this? Why make the politically charged, and wholly inaccurate, link between “large increases” and recoverability of success fees and After-the-Event insurance premia?
Of course next year, based on this year’s higher figure and using the same, new, recording procedure the percentage increase will revert to a true figure, so it is just this one year when the percentage increase is distorted upwards.
Am I being too cynical in thinking that it suited the NHSLA to present the report to Parliament in this way this year just as Parliament is considering the abolition of recoverability?
As Disraeli said “There are lies, damned lies and statistics”.
Hertfordshire Boy
Bovingdon played local rivals Sarratt at cricket last Sunday.
Until 15 years ago the villages had not played each other since the 1940’s. Rationing was in place and a Sarratt player, a farmer, had been working all hours to bring in the harvest. With hay still in his hair he turned up at tea to be told by Bovingdon that he could not bat as he had not fielded.
Protestations that people would starve had he fielded were met with the response beloved of cricket teams and lawyers alike: Rules is Rules.
Sarratt walked off for 50 years. After being out for a duck on Sunday I nearly marched off; I had courgettes to pick and broad beans to freeze.
The Sarratt – Bovingdon cold war divided families. Between the wars the Bovingdon to Sarratt love-bus ran twice a year between the two villages to bring youngsters together and, apparently, to widen the gene pool. The jury is out on whether this was successful but most villagers over 70 have one of two birthdates.
Chipperfield play Bovingdon for the Chiltern Trophy, which Bovingdon always retains, not just because of our cricketing skills but because:
- I wrote the rules; and
- Chipperfield are unaware of the existence of the trophy.
Bovingdon has the loveliest of grounds so we rarely venture away on Sundays and we always get lost when we do, culminating in the Iver Heath incident when the four cars carrying the Bovingdon stars were each first in line at the four points of a country crossroads.
One time our convoy passed the other side’s convoy coming the other way. We turned up at their ground and they turned up at ours. As the team was Nazeing Common, 30 miles away, this was a problem. Mobile phones have prevented a recurrence.
Our Sunday team, like most others, is a mix of class, race, talent and age with representatives of every decade from our Justin Bieber lookalike teenager to our seventy-something Methuselah lookalike wicketkeeper.
25 miles from London and just outside Hemel Hempstead, the world’s best town, Bovingdon is a million miles from the chatterati of Hampstead.
Ours is a better England.
RACING UNCERTAINTIES
The Great Legal Profession De-Regulation Stakes
Westminster: 6 October 2011
| Sponsors: | Office of Fair Trading sired out of Jealousy and Nihilism |
| Prize: | Destruction of the one part of the constitution still functioning. |
| Runners: | |
| ASDA: | Fixed Price Guarantee! |
| Handicap: £9.39 million fine for price fixing. | |
| SAINSBURYS: | Handicap: Fined £11 million yesterday for price fixing. |
| Try Something New today? | |
| TESCO: | Handicap: £10 million price fixing fine. Every Little Helps. |
| NEWS | |
| INTERNATIONAL: | Won’t be able to hack it. |
| NORTHERN ROCK: | Poor on the home run, or anything to do with homes. |
| CO-OPERATIVE | |
| FUNERAL SERVICES: | Dead Certs. |
| LLOYDS HBOS: | Seeking to diversify. Might try running a bank. |
| Not one for the Journey. | |
| ROYAL BANKRUPT | |
| OF SCOTLAND: | Took £22 billion in one day! Unfortunately it was from us. |
| Would have funded 10 YEARS of legal aid. | |
| Rank. Outsider. | |
All prizes donated by the Office of Fair Trading out of fines levied on supermarkets for price-fixing; that is the same Office of Fair Trading whose report led to the de-regulation of the legal profession allowing all of the law-breaking price fixing supermarkets to become law firms.
Well done OFT!!
Going: Awful to even worse
Distance: 900 years
Rust that clings to the form that strength has left
Hard and curled and ready to snap.
T S Eliot: Rhapsody on a Windy Night
Legal Aid dies – aged 63
The death of civil Legal Aid, born in 1948, has been announced in the Legal Aid, Sentencing and Punishment of Offenders Bill.
A spokesperson for the Legal Aid family said:
“Legal Aid used to be a voucher scheme, with clients having an unrestricted choice of solicitors, all of whom did legal aid and who received the same fee.
“Clients paid means-tested contributions and solicitors paid 10% of their fees, including those received from a losing party, to the Law Society to administer legal aid, which thus made a profit in many cases for the Legal Aid Fund.
“It cost the taxpayer almost nothing, and most taxpayers had access to legal aid. It was very healthy and very popular.
“Then the big business profit centre mediocre middle management statists radicalized our Legal Aid. Individual clients meant nothing; solicitors meant nothing. Mass contracts and “matter starts” replaced justice, quality and professionalism.
“Most of Legal Aid’s friends deserted him; he had become unpleasant due to his terrible ‘big business syndrome’.
“This strange cult decided that Not for Profit organisations were the answer. These were Alternative Non-Business Structures funded by the State, but public spending cuts mean that they are all dying too; the Immigration Advisory Service and Law for All have just been buried and 18 out of 56 Law Centres are terminally ill.
“People do not realize how terrible this cult is and how it is infecting every area of British life.
“All Solicitors were friends of Legal Aid and then he lost most of them. His death is a release from this terrible curse.”
The Legal Aid family hopes that one day a cure will be found and request that all donations be sent to “Small is Beautiful”.
“Glance is the enemy of vision”
Ezra Pound
