THE SICK SOCIETY

In three days’ time, we have a general election. So far, we have heard a great deal from the parties about who will be allying with who after the election, or not, but little about the detail of their promised policies. Not that promises mean much anymore, after the Liberal Democrats’ now famous u turn on their promise to oppose increases in tuition fees.

But their policies are the reason we turn out every four or five years to cast our vote, and after the socio-economic firestorm of the last five years, many people feel that reparation is required, and the parties’ policies should reflect that.

No right-minded voter would vote on the basis of one single issue. However there are issues whose effects percolate throughout the entire fabric of society. Justice is one of them.

In the film, Devil’s Advocate, after Al Pacino has just told Keanu Reeves that he is his father (oh, and Satan – who’d have thought…), Keanu Reeves asks him why he chose to manifest himself on Earth as a lawyer:

Keanu Reeves (Kevin Lomax); “Why the law?”
Al Pacino (John Milton/Satan); “Because the law, my boy, puts us into everything”.

The story is thankfully fiction, but the point above is not only a fact, but a blindingly obvious one at that. Which makes it all the more extraordinary that a seemingly intelligent group of politicians can have inflicted so much damage on the legal system of England and Wales.

Over the last five years, the Conservatives have taken it upon themselves to mount a sustained and vigorous attack on the rights of the common man. Among their more well-known policies, they have:

  • Introduced the “Bedroom Tax”, and Benefits sanctions for the most minor of defaults; both have resulted not only in widespread hardship, but even in tragedy;
  • Withdrawn legal aid for both family and criminal work, and have left convicted defendants who have pleaded not guilty facing payment of high fees, leading many to believe that many accused parties may prefer to plead guilty rather than roll the dice at trial;
  • Stated their intention of reducing the costs of civil litigation, and did so, and then raised court fees by an average of 600%. How raising court fees is supposed to be compatible with the Government’s identified issue that “The costs of civil litigation are too high, and are fuelled by no win no fee conditional fee agreements (CFAs)”, is anyone’s guess, and is just another illustration of the undisguised hypocrisy and contempt which has characterised much of the policy of the last five years.
  • Increased tribunal fees resulting in a reduction in tribunal applications of approximately 70%. The only logical result from this is that employees who have been unfairly dismissed are not taking action because they cannot afford the fees.
  • Taken action to restrict access to Judicial Review, one of the most powerful tools available to the people when seeking to hold the Government to account.

As a result of the above changes, one survey states that people are now more concerned about access to justice than access to free healthcare. This point is reinforced by the fact that GPs are reporting that they are seeing increasing numbers of patients with unresolved legal needs during their consultations.

It is not only the public, but Judges who are becoming more and more concerned at this withdrawal of justice from the masses. Sir Alan Moses recently said, “No one seems to care about the plight of those who have neither the ability to protect themselves in a legal sense and cannot afford a lawyer”. And for those brave people who do try to present their own case, the courts cannot cope.

An open letter was recently written by more than a hundred Peers, lawyers and doctors, requiring that the new Government, whatever creed it may be, takes steps to restore justice to the people.

This plea has become lost among the headlines, and was no doubt viewed by some in Whitehall as just another whining and self-serving attempt at self-promotion by those who submitted it.

I believe it is a genuine appeal to the next incumbents to fight a cancer in our society, which was born out of, and is growing due to, this Government’s policy. I further believe that there are serious long term consequences looming if some of the changes that have been introduced in the law are not reversed.

Cameron came out just over a year ago and finally admitted that he was not imposing austerity just in order to repair the economy, but because it was the way he believed society should stay.  He said that the Country needs “to do more with less”. If these policies continue, many people, almost all of them less wealthy and more vulnerable members of our society, will get less for less, not more for less.

The Tories talk about rising employment figures, but the reality is, with checks and balances on employers reduced, (see this article for a summary) zero hours contracts and under employment more prevalent, a sick work force with a growing reliance on food banks, and this can only get worse.

From my long years of experience as a personal injury lawyer who has worked on employers’ and public liability claims, I know that, whilst the large majority of employers may well treat their employees fairly, many don’t, especially the lower paid employees. The above changes are already making that worse.

Add to that restrictions on the quality of representation already being seen due to the introduction of fixed legal fees for injury claims, the withdrawal of legal aid for most family work and its reduction in criminal work, and the doubling of the Small Claims Limit in April 2013, and it is apparent that justice is no longer a foregone conclusion in most adversarial cases, particularly in low value disputes. Even the Master of the Rolls believes this to be the case.

Women and children are staying in violent relationships because they cannot afford to take legal action.

And finally, we could shortly have innocent people pleading guilty, simply because they cannot afford the consequences of losing, whether they are innocent or not.

Cameron heralded his 2010 campaign with his flagship policy – the “Big Society”. What he has achieved in the last five years is no Big Society, but a “Sick Society”, where success replaces justice as a commodity to be bought by those with the means to afford it. Meanwhile for those who cannot, in the longer term, the consequences are likely to be;

  • with fewer controls on employers, combined with an ever more competitive marketplace, there is likely to be a steady increase in the number of unemployed and underemployed people (zero hours contracts and those on unpaid apprenticeships and internships notwithstanding);
  • an increase in the number of innocent defendants choosing to plead guilty in order to avoid punitive court fees if their case is lost;
  • an uphill struggle for small businesses and injured people, who will find it increasingly harder to achieve redress against defendants with greater means;
  • a long term deterioration in familial relations, due to all of the above, and also due to there being no effective method available for spouses and parents who cannot afford legal advice and assistance to resolve their issues;
  • a concomitant impact on the social and emotional development of children, the nature of which can only be guessed at, but which is obviously not going to improve;
  • with all of the above we are also likely to see an increase in mental health issues with a resultant increasing burden on the NHS. In fact, this has already been found to be the case, even in children.

None of this is likely to have a beneficial effect upon the country’s GDP.

All of us, regardless of our position in society, could find ourselves down on our luck. A divorce, a redundancy, a repossession, a County Court Judgement could be all that separates us from those looking to the State for support.

If we were to do so today, however substantial our contribution to the exchequer over the years, we are unlikely to meet with any sympathy. In fact, Mr Cameron recently summarised the Government’s position succinctly, when he suggested that those requesting financial help to bury a dead war hero should seek a “charitable solution.

At some stage, if not in the next Parliament, someone with the power and authority to make a difference, will realise that, in the words of Al Pacino, “the law, my boy, puts us into everything”. Hopefully they will then be able to begin undoing some of the damage that the Conservatives have done over the last 5 years.

I just hope it doesn’t take too long for the penny to drop.

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Happy 800th Anniversary Magna Carta – where has justice gone?

On 15th June 2015, we celebrate the 800th anniversary of Magna Carta. The website, which has been set up as part of the celebration of this great event, emphasises the importance of this innovative document, which established for the first time the accountability of the state and the rights of the common man. The above web page heralds as its title “To no one deny or delay right or justice”. A noble proclamation, and ye (well, we) can all find countless pages devoted to the Magna Carta celebrations on the web.

So, why ye (sorry, you) may ask, is there a Vote for Justice Rally on the 23rd April, less than 2 months before the 800th anniversary of arguably the most important event in English justice, ever?

The short answer is that the last two years have seen the most significant and sustained assault on justice in England and Wales for decades.

The Vote for Justice Rally is in response to the dramatic reduction of legal aid, primarily in criminal work,  but also in family work. In fact, almost 60% of parents involved in family disputes have been forced to represent themselves in Court since the removal of legal aid. Some even believe that, because of the dearth of legal aid now available for domestic violence, women will die as a result of these changes.

These cuts were just a small part of the draconian legal changes imposed since 2013. The legislation that imposed the bulk of these changes was the Legal Aid, Sentencing and Punishment of Offenders Act (2012). The same act also imposed significant changes on personal injury cases.

Other than legal aid, the main changes are, a ban on solicitors buying personal injury cases, and extensive changes to the legal costs recoverable by claimants on winning their injury cases, the result of which is that injured claimants who win their cases can now no longer keep all of their compensation.

As far as the ban on payments for cases is concerned, speak to any personal injury lawyer and they will tell you that:

a) This didn’t work, and;
b) It was never going to work.

The referral agreements changed to marketing agreements, which were drafted in full compliance with the new rules, and business continued as usual. In fact, the insurers who were paying the claims started sidestepping the ban before the law even changed.

So that was a great use of resources by the MOJ.

Turning to the deductions from a claimant’s compensation, you’ve all seen those TV adverts, right, the ones where sombre lawyer types with sharp suits and Hollywood teeth assure you that they will fight the big bad insurance companies to the death on your behalf? Did you notice when the script switched from you’ll keep “100% of your compensation”, to “all of the compensation you deserve”? In case you’ve ever wondered why, that’s why.

All of these rights have been snatched away from ordinary people like you. In return you have been given the dubious benefit of Qualified One Way Costs Shifting, or QOCS.

In essence this means that if you claim and lose, you don’t have to pay your opponent’s legal costs. The person sued (usually represented by an insurer who will be paying the claim) cannot recover their legal costs if they defeat the claim, with the one exception of you (the claimant) having been “fundamentally dishonest”.

Just as with referral fees, this is not working out quite as anticipated. In view of the fact that insurers cannot now recover their costs if the claim fails, many firms are running more or less every case that comes through the door, regardless of prospects, in the hope that insurers will make early settlement offers rather than fight them.

This of course has not helped the Government in their quest to stamp out unmeritorious claims. Quite the opposite, in fact. And it is having an equally negative effect on claimant/insurer relations. What the Government wanted was for the national claims pool to be reduced and purified. What they have got is a system where a higher proportion of new enquiries than was the case before LASPO, are now presented as claims.

Well, remove the risk, and what did they think would happen?

The result is that the insurance industry has moved from DEFCON 3 to DEFCON 2, and they now see fraud everywhere. Demonstrably genuine claims which, 5 years ago would have been settled on the best terms, are now being fought tooth and nail.

Another great use of our taxes by the MOJ.

To make up for losing 25% of their damages as costs, claimants have also been given a 10% increase in damages (100, minus 25, plus 10 is….nope, maybe it’s just me), but this apparent benefit is, in practice, rarely more than a mirage. Unless a claimant takes a case all the way to trial, cases tend to settle for a negotiated global sum and it seems clear that you, the claimant, are still worse off since LASPO. So as a result of LASPO, injured claimants have suffered a significant reduction in their ability to access legal redress. Even insurers agree that the benefit of this assault on justice has been largely theirs.

But the assault on justice does not stop there.

Staying with injury claims, recoverable legal fees for road traffic accidents have been reduced by 60%. Imagine hiring an accountant and learning that a change in Government policy had reduced their fees by 60%. Granted, not everyone would be that bothered, but would you really expect them to offer the same service as they had before? And would you be that surprised when they told you that they would have to add a 25% surcharge? Inevitably the dramatically reduced fees will reduce the quality of the work done. How can they not?

In fact, they already have, and as a result of the sharp drop in remuneration, evidence of under settling of claims has emerged.

So that worked well.

For public and employers’ liability claims, fixed costs have been applied across the board up to a claim value of £25,000. The costs scales are in fact quite reasonable, but are only workable if insurers behave reasonably, and at the consultation for fixed costs, the MOJ was presented with a significant body of evidence of routine unreasonable behaviour by insurers, and ignored it.

With personal injury, it doesn’t even stop there. Claims resulting from accidents at work were made harder for claimants to prove by the Enterprise and Regulatory Reform Act (2013).

Many people do not realise, until they have an accident at work, that the employer holds all of the cards – documents, witnesses, even the equipment and location are theirs. Decades of health and safety legislation designed to neutralise the imbalance between an employee and their employer was rendered impotent by this act, meaning that employment injury claims will now be much harder to prove. Those regulations were designed to protect employees, and to force employers to take better care for their workers.

However, in this enlightened age of zero-hours contracts and fierce competition in the aftermath of the recession, it does not take a brain surgeon (although it clearly takes more than several politicians) to work out the effect that this is likely to have on employers, and on their employees.

Then there is the dramatic increase in both tribunal fees and Court fees. The increase in tribunal fees has led to a 73% drop in tribunal claims, such a significant drop in fact that the Government are now considering lowering the fees.

The inescapable conclusion from this is that unfairly dismissed employees are not taking action because they cannot afford the fees (well, when you’ve just been unfairly sacked, tribunal fears are hardly your first priority).

Then there is the very recent 600% rise in Court fees (about which I have already filled several column inches). Perhaps they think we have forgotten, but this increase followed the rise in Court fees a year earlier levied by the same Government!

Are we to expect another fee rise? How far does this go? Should claimants expect to have to set up monthly standing orders to the MOJ? Will we have to sign over our houses to the Government if we wish to make a claim in future? I look forward to the next announcement with great anticipation.

Throw in the Government’s determination to stifle access to judicial review, and the unmistakeable conclusion is that they are pursuing a sustained and ferocious attack on the ability of the common man to access justice. This is not just my view either. Most lawyers now believe that wealth is central to having unfettered access to legal assistance and redress.

For the remainder of us who cannot afford to pay for legal help, the only options in such cases are to find someone who can provide justice on a shoestring, or of course to DIY. Many people, unable to pay for a lawyer to help them, are doing it themselves, and are getting it wrong. Good cases are being thrown away because ordinary citizens are unrepresented, and some are even pitting themselves against trained lawyers in court.

This outcome is not especially surprising when you hear that the Ministry of Justice has admitted that “they did not have the time to research the potential impact of cuts to civil legal aid”. Their candour is welcome, although not unexpected when you look at the impact assessments from the consultations, for example the consultation into reform of the whiplash claim process and costs.

The phrases “It has not been possible to quantify the costs associated with this proposal”, and “It has not been possible to quantify the benefits associated with this proposal”, are repeated 6 times. In fact there is no evidence in the impact assessment that they have found it possible to quantify anything.

And yet despite this, they pressed on with changes which have led to solicitors’ firms closing down, claimants losing a significant proportion of their compensation, and the creation of an advice vacuum for those on low, or no, income.

That’s an impact, isn’t it?

In a nutshell, the Government’s approach seems to be that “we don’t know what the outcome will be, but we’re going to do it anyway”. Life on the edge – how exciting!

As I write this, the internet is littered with reports of the Andrew Marr interview with George Osborne, in which George Osborne, who, having presided fiscally over a very difficult five years for the NHS, has, a month before the election, just promised to find £8 billion for the NHS if the Conservatives are re-elected.

In the aftermath of a five year brutal attrition of public services, the question “where does the money come from” inevitably springs to mind. George Osborne avoided answering that question 18 times. Of course, wherever the money may or may not come from, I’m sure that, as some people have alleged, the promise has nothing to do with the letter from 100 doctors to Mr Cameron 5 days earlier.

Is this just another example of “suck it and see” politics, which seems to have characterised this Government? The embarrassing reconsideration of Employment Tribunal fees referred to above certainly seems to fit that theory, as does the miraculously impact-free impact assessment (not much of a ring to that…) for the Whiplash Consultation, and the MOJ’s comments concerning the lack of consultation, during the Civil Legal Aid consultation (or that…).

So why this extraordinary attack on justice? Is it really just because cuts needed to be made from the public purse?

No.

There is no benefit to the public purse from reducing legal costs in personal injury work. The Government stated at the time that, as far as injury claim costs were concerned, they were seeking to reduce the burden on consumers by helping insurers to reduce car premiums. So how does that fit with making injured consumers and small businesses pay a 600% increase in court fees?

It doesn’t.

So what is the justification behind this onslaught? As far as injury claims are concerned, evidence has emerged of deals between the insurance industry and the Government.

Whether there were deals or not, and what the Government may or may not have got out of them, will remain a mystery. However, the haphazard and rapid manner in which these changes have been implemented suggests a lack of understanding of the subject matter. In fact, following the withdrawal of legal aid for family matters, the courts are now so inundated with unrepresented parties (“litigants in person”) that the Government is now having to spend more time and resources on dealing with that problem.

Another plan that didn’t quite come out as intended.

Chris Grayling, the first non-lawyer Lord Chancellor ever in this country, has been repeatedly criticised for having no understanding of his role, and there has been considerable discussion over whether the position of Lord Chancellor should be held by a lawyer. Mr Grayling’s own view is that he considers being a non-lawyer an advantage, as “it enables you to take a dispassionate view”, in which you do not “favour the bar or…the solicitors’ firms”. Well you would never have guessed the last bit.

So in conclusion, one has to acknowledge the considerable irony that, in the year the Magna Carta celebrates its 800th anniversary, a year in which the legal system of this country should be hailed as having evolved into an unparalleled paragon of justice, it has in fact atrophied into a shell-shocked combat zone, in which the expenditure of far too much energy is necessary just for legal firms to survive, and many haven’t.

Injured clients no longer recover all of their compensation; impecunious parents and spouses struggling to negotiate a difficult separation, are forced to plead their own case in court; victims of domestic violence are left with no alternative other than to stay and hope things change; and criminal lawyers are forced to stage protests in a brave but probably futile final effort to save their industry from being decimated.

So much for the accountability of the state and the rights of the common man.

On the 15th of June, are the Conservatives really going to be celebrating the 800th anniversary of the signing of the Magna Carta?

Or will they be privately rejoicing having confined it to the shredder?

Who knows?

However, there is one final point of relevance to the Magna Carta which I have not yet addressed. This becomes immediately apparent if you refer to clause 45 which states:

“(45) We will appoint as justices, constables, sheriffs, or other officials, only men that know the law of the realm and are minded to keep it well.”

My money is on the shredder.

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Court Fee Rise – Early April Fool!

As my blog so far has not been what you might called “light hearted”, I couldn’t resist an opportunity to inject a little levity into it.

And this letter from Chris Grayling, Lord Chancellor has provided that opportunity.

For any not familiar with the recent 600% Court Fee rises, I have already written about the hypocrisy demonstrated by the Government in implementing these rises, and I have also written about Justice Minister Lord Faulks’ comments that “litigation is an optional activity“, which of course is great news for those who face losing their business, or life in a wheelchair.

It seems however that the Lord Chancellor, having instigated the highest Court Fee rise in British History (maybe even in world history), by a long way, has now decided, for some reason which is not clear (until you remember that there is an election in a month’s time), to offer the olive branch of a possible review of his monumental Court Fee rises.

So, raise fees by up to 600% seven weeks after they first announce the idea. Then offer a month later to keep them under review.

Okay…

The obvious question that arises from this is, does he now believe the decision to implement the fee rises was wrong?

Everyone knows that the Court Fee rises of 600% don’t pose any risk to access to justice – Justice Minister Shailesh Vara said so. As the minister also said, this is a “sensible measure”. Of course it is!

So why the need to keep them under review?

Maybe the MOJ is not quite as sure of their facts as they initially seemed to be. Let’s look at the letter. 

It says that the scheme has only been in place for a short period of time so far, and it’s not possible to judge whether there will be any impact. Technically true. However, if the Government suddenly decided to increase the cost of iPads by 600%, and announced “we’ve decided to increase the price of an iPad from £400 to £2400;  there’s no evidence of any impact yet, but we will keep matters under review in case guidance needs to be tightened in “exceptional circumstances”, the public would be pleased, right? It’s a “sensible measure”. And obviously no rational person would jump to the completely irrational conclusion, without solid evidence, that iPads were now wildly overpriced, and wouldn’t touch Apple with a barge pole. People would continue buying them at the 600% inflated price, until the Government had gathered sufficient evidence of an impact. Right? Of course they would.

And for those societal “exceptions” who could not afford to find £2,400 for their iPad (or £10,000 for the Court Fee that may save their business or their livelihood), they have the comfort of knowing that the fee rise may be reviewed in “exceptional circumstances”. Are those the same exceptional circumstances as are now applied to Legal Aid applications (1500 applications; 69 successful)? If so, I won’t be holding my breath for the review.

He also says in the letter, that there are arrangements in place to help people bring “these sorts of claims”, which he states are CFAs (no-win, no-fee contracts) and ATE insurance.

Firstly, what “sorts of claims”? Do the increased Court Fees apply to only one type of claim? Please clarify Mr Grayling, as I must have missed that part of the press release.

Secondly, he is saying that solicitors or After the Event insurers (ATE) should stump up the hugely increased Court fees. Well, true, that is what normally happens. But two years after the Government dramatically cut solicitors’ fees, and also introduced Costs Budgeting for larger claims (a process which is proving to achieve nothing more than to generate massive amounts of extra work for claimants, and to provide defendants with a pre-trial opportunity to reduce the claimant’s costs – effectively, a “practice shot”), they now propose asking solicitors to carry up to 600% more in Court Fee disbursements for two to three years!

Really? How much more can the Claimant solicitor business model take?

He also says that “many of your concerns are addressed by the current fee remission scheme”. So if I’m following that correctly, a scheme which allows some claimants who claim benefits remission from Court Fees, will help people cope with a 600% rise in Court Fees. So how will that scheme help seriously injured claimants who are not on benefits? And how will such a scheme help small businesses who have already suffered a significant financial loss?

It is tempting, as has so often been the case over the last couple of years, to think that he is so appallingly misguided in his policies because he is not a lawyer, and has no idea of the effect of such changes at the coal face.

Or maybe his boss has simply told him that there’s an election coming, and to knock out a few lines to keep the punters happy?

Or maybe the letter is just an early April Fool. One way or another, the answer will present itself tomorrow.

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McKenzie Friend, or Foe

The Government is being asked by MPs to consider regulating McKenzie Friends . It is important to ensure that all those participating in legal action, whether clients or Litigants in Person (LIPs) are protected, but is the best way to do that to enforce regulation? The call for regulation suggests that McKenzie Friends are being treated in the same way as lawyers, but the role is not a legal one.

The McKenzie Friends Guidance July 2010 states:

The Right to Reasonable Assistance
2) Litigants have the right to have reasonable assistance from a layperson, sometimes called a McKenzie Friend (MF). Litigants assisted by MFs remain litigants-in-person. MFs have no independent right to provide assistance. They have no right to act as advocates or to carry out the conduct of litigation”.

So if McKenzie Friends are not lawyers, what are they?

“McKenzie Friend” is a title given to people, usually not legally qualified, who provide assistance to those in Court, or in Court proceedings. In essence, a “lay” representative.

The term is not a qualification. It is a role, which has been thrown into sharp focus since the Government’s recent legal changes (mainly the Legal Aid, Sentencing and Punishment of Offenders Act (2012) but also the doubling of the Small Claims Limit to £10,000 in April 2013) destroyed access to justice for millions of people, chiefly in family law cases, but also in civil litigation.

Since the above changes, most of those who used to use solicitors to run their cases, can no longer afford to do so. In family cases, without legal aid, many families cannot afford to pay lawyers. In Small Claims debt cases of up to £10,000, because legal costs are not recoverable, many people and small and medium sized enterprises (SMEs) can no longer afford to pay solicitors to run their cases as they won’t recover their legal costs even if they win. This one change has had the effect of stifling the Government’s intended jump start for small businesses. I have lost track of the number of times I have read online posts by small business owners who say that they risk going under because of one debt of several thousand pounds.

Little preparation was made for the aftermath of the cuts which led to these changes in the law. In fact the civil service have admitted in evidence that the cuts were rushed through without proper assessment of the impact.

So there is currently an advice vacuum in the legal world. Thousands of people require representation, but cannot afford to pay a solicitor to help them. The fact is that McKenzie Friends can fill this gap, because they are mostly self-employed, with none of the regulatory baggage which solicitors have, which enables them to keep their fees low. They are, for the most part, not lawyers, but if they can provide safe and effective assistance to someone who is out of their depth in Court at an average of £50 an hour, when solicitors normally charge over £150 per hour, their value is proven.

But what does all this have to do with regulation, and why should they be formally regulated? Is formal regulation just a knee-jerk reaction to the emergence of this new role to fill the legal advice void, or is it a necessary precaution to protect vulnerable litigants in person?

The Society for Professional McKenzie Friends was formed in response to calls from the Legal Services Consumer Panel for tighter control over those who act as professional McKenzie Friends.

Its requirements for membership are that all members must:

i) Have professional indemnity insurance (PII);
ii) Have a qualification at A-level or above in law, or at least three years’ experience as a McKenzie Friend;
iii) Register with the information commissioner.

So the Society has already taken steps to ensure minimum standards for its members.

I am not a member and have never practiced as a McKenzie Friend, but as a sole-practicing qualified lawyer, I see the damage done to society by the withdrawal of access to justice from people and small businesses, and I welcome any safe and inexpensive solution to help people resolve their legal issues. They are not lawyers and cannot replace lawyers, and the legal industry should not be afraid of their emergence.

Protection of clients is however critical, and there is a fine line between balancing quality control, and allowing this low cost lay assistance to thrive. The Government has decided that formal regulation of McKenzie Friends is unnecessary, although they plan to continue monitoring the situation.

So are there any steps which could be taken to help protect consumers, without clogging up the arteries with regulatory baggage. Until evidence emerges of problems being caused by this burgeoning industry, surely the logical approach would be to build on what is already there. In other words, use the developing structure to regulate itself.

For example, for professional (fee charging) McKenzie Friends, make membership of the SPMF compulsory. This would bring the advantages of compulsory professional indemnity insurance, a minimum standard of legal education/experience, and compulsory compliance with the Judiciary’s McKenzie Friend Code of Conduct.

The Government has wrecked access to justice, and yet the legal services industry has found a way to provide the help that people desperately need at low cost. Similar solutions are springing up in other jurisdictions in which access to justice has been similarly affected, namely New York and Ontario, Canada. If the NHS was suddenly privatised (watch this space…) and millions of people found themselves unable to afford a doctor, would it really be either prudent or fair to deny people access to cheap and readily accessible first aid? If first aiders were viewed as medical staff, a classification which I doubt you would find anywhere, and were regulated like doctors and nurses, that could easily be the inevitable result.

So instead of assuming that McKenzie Friends are, and practice as, quasi-lawyers, let this newly flourishing tier of lay assistance grow unfettered by the layers of regulation that have contributed to the increase in the cost of legal services over the last 10-20 years.

Let it breathe.

An Undesirable View

A quick footnote to my last ODR post. I found this discussion thread on LinkedIn

I have written two blog articles on this, and thought I would accept the invitation to comment, and add my views. I duly did so.

My post comprised words along the following lines: “This could be a viable solution, but ODR requires two parties to engage, and the latest Government figures show that defences are down 18% and default judgements are up 25%. The number of defences have also dropped for the 5th year running. This needs to be borne in mind before pressing ahead with a mediation based alternative to litigation”

I received an automated message stating that my post was awaiting approval. So far, so good.

The next day, no post published! Instead, the post below was there, where I expected mine to be:

Untitled

So, my post was not approved, and this appeared instead. In the aftermath of my freshly scorned viewpoint, I was left feeling like a schoolboy being sent to stand in the corner.

Not being accustomed to taking the words “detention, Talbot” for an answer, I resubmitted the post politely pointing out that my original didn’t seem to have made it through the shredder. That was two days ago.

I think that my comments were reasonably benign, polite, and inoffensive, so I am still wondering why, in this enlightened democratic age, my opinion was not acceptable for publishing on a thread which invited readers to give their opinions.

Taking into account all the circumstances, logic would dictate that, for reasons unknown to me, my adversarial viewpoint is not an appropriate response to the question “Is online dispute resolution the way forward for low-value claims?” It is tempting to think that, had I submitted words to the effect of “Great idea…” and added a few congratulatory compliments to the advisory group, I would have had the pleasure of seeing my words in print.

Being a public spirited kind of chap however, I prefer to think that my post just got lost or mislaid.

Twice.

Well, I know it’s a stretch, but it can’t really be the case that discussion groups publish only approving views.

Can it?

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ONLINE DISPUTE RESOLUTION – ONE TO TANGO?

Last month, the Civil Justice Council’s Online Dispute Resolution Advisory Group produced a report recommending a trial of Online Dispute Resolution, which they believe could help extend access to justice to those who have been disenfranchised by the Government’s numerous changes to the English legal system.

Online Dispute Resolution (ODR) is an internet-based court service, which the CJC Advisory Group say is designed to bring parties together and assist them in resolving their disputes with a minimum of fuss and expenditure.

Their vision sees the dispute resolution process divided into three categories:

Tier One – Online Evaluation. To help users with a grievance to classify and categorize their problem, to be aware of their rights and obligations, and to understand the options and remedies available to them.

Tier Two – Online Facilitation. Online “facilitators” will help parties through mediation and negotiation, with the help of some automated negotiation.

Tier Three – Online Judges who will decide suitable cases online.

As you may have guessed, I have various issues with this, many of which I have already aired.

Whilst this report was written by an Advisory Group to the CJC, it was commissioned by the Government in an effort to resolve the problem caused by the rising number of unrepresented people at court, the problem being that unrepresented people take longer to get through cases and generally have lower prospects of a negotiated settlement because many do not understand the law.

The irony of all this, is that the huge increase in the numbers of unrepresented people, (“Litigants in Person”, or LIPs) has been caused by the Government.

The changes introduced in the Legal Aid Sentencing and Punishment of Offenders Act (2012) have resulted in a dramatic increase in the number of unrepresented people, primarily because their legal lifeline was cut off by the near complete withdrawal of Legal Aid for family work, forcing almost 60% of parents to represent themselves in Court.

The number of LIPs in Court has been increased further by the doubling of the Small Claims Limit from £5,000 to £10,000 from April 2013. In a nutshell, this means that, whereas before that date, for debts of between £5,000 and £10,000 you could afford to hire a lawyer because you could recover their fees if you won, you no longer can. This is all further compounded by the fact that, because of the lack of legal representation, many cases are resulting in the wrong decision. Even the Master of the Rolls believes that without lawyers to help people, this is inevitable.

So, to summarise where we are so far, the Government, having created an advice desert, is now trying to fix it.

But will ODR fix it? The answer to that question is here.

Earlier this month, the Government produced a report on the 2014 Civil Justice Statistics. To quote from that document, “In October to December 2014, courts dealt with 379,000 claims and 196,000 judgements were made (1% and 15% higher respectively than same quarter last year). In contrast, the number of defences stood at 46,000, down 18% on the same quarter the previous year and the fifth consecutive year on year decrease (when compared to the same quarter the previous year). There were 829,000 judgements in 2014, up 25% on 2013. The increase is due to the combination of an increase in claims and a decrease in claims being defended, leading to more default judgements occurring”.

If we just pause for a moment there….

  • Judgements up 25% in 2014 on the previous year.
  • Defences down 18%.
  • The fifth year on year decrease in the number of defences filed.

So, how does ODR, a system designed to “help users with a grievance to classify and categorize their problem” and to “help parties through mediation and negotiation, with the help of some automated negotiation”, solve a problem where only one party comes to the table?

It takes two to tango. It takes two to mediate. It takes two to negotiate. It takes two to reach a settlement.

It takes only one, however, to litigate.

And the problem (which will have been obvious to everyone who has ever done debt recovery work by the time they finished reading the title of this article), is that it is common in debt recovery to be ignored by a defendant. And in this significant proportion of cases, how does mediation help? How does automated negotiation help? For that matter, how do Online Facilitators help?

When you take away all the window dressing of this shiny new toy, and place it firmly in the context of the English dispute resolution system as it is today, all you are in fact left with, is a very expensive computer game and no one to play it with.

Tier one is already there. By an amazing coincidence, we already have people who “help users with a grievance to classify and categorize their problem, to be aware of their rights and obligations, and to understand the options and remedies available to them”. They are called lawyers. Or they were before the Government wanted to take them away and replace them with computer decision trees.

Tier two is already there. By an even greater coincidence, we already have “facilitators who will help parties through mediation and negotiation”. They are called lawyers. And since the Government’s changes began two years ago over a thousand legal practices have closed down.

And now the Government wants to solve a problem of their own making of a shortage of legal representation, by taking more work away from lawyers and automating it.

And (here’s the rub…), they want to introduce a system which requires both parties to be at the table to work properly, into a legal framework where for much of the time there is only one party at the table.

Many have criticised the Government of being out of touch (including myself), and many would say that this is yet another example of that (including myself).

In July 2013 the Government massively increased employment tribunal fees directly resulting in a drop in tribunal applications of around 80%. This is yet another flagrant example of people losing their access to legal redress.

And, as if that is not bad enough, last year the Government announced that because of the huge drop in tribunal applications, they were considering lowering the fees.

20 years ago, I was Father Ted’s number one fan. This Government’s ham-fisted efforts at reforming the law of this land cannot help reminding me of Father Ted beating that dent out of his car – with each blow creating more carnage. Perhaps this should not be surprising when you consider that our Lord Chancellor is the first non-lawyer in that role.

I can only hope that their efforts on ODR are more carefully considered than the implementation of the changes over the last two years.

BGJvD4x

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An “Optional Activity”.

Today’s 600% Court fee rise – I thought I was more or less blogged out on this particular subject, but an angle unexpectedly presented itself today which has served to highlight the raw inhumanity of this wonderful new wheeze of the Eton Posh Boys. So I had to share this one. Please bear with me – the reason will become all too clear soon enough.

As you will see from my previous blog, (and if you are in any way involved in the law, you will have received the news like a length of stout English oak in the face over the last week) that the Government have today increased court issue fees on claims of value of above £10,000, to 5% of the amount claimed. So that’s an increase of around 600%.

The numbers can’t help sounding a bit lame – like hearing about a tragedy in a remote part of the world; the remoteness terminally dilutes the impact. Until you imagine walking into a supermarket and asking for a loaf of bread, only to find that it costs not £1.50, but £9.00.

Or you walk into a phone shop to buy the new iPad Air 2. You gleefully peel out £400, only to find that the price as of today, is £2,400. Why, because the Government said so. I won’t go into more detail – I’ve done that already, and there are plenty of articles which give the facts, like this one.

Suffice to say, most of the changes that have rocked the legal litigation world so far, have hit….sorry….have been aimed at, low value claims. This change however only affects claims worth over £10,000, or moderate to serious injury and financial loss.

So anyway, to the angle.

I went to see some clients of mine today. They are a pleasant family from middle England, Mum, a young girl and a young boy. I have known them for seven years, almost to the day. We met seven years ago, after a driver who was at the time delirious from heroin and alcohol, drove into the front of their car at a combined speed of at least 80mph, and destroyed seven lives, including his own, and his own daughter, who was one of his passengers.

Luckily, my two clients, the brother and sister, both survived. Unhappily the other three occupants of their car – their grandfather, their grandmother, and their aunt – did not.

When I say “luckily”, I qualify that by explaining that they are both still alive and in relative good health.

The little girl was almost cut in half by the lap belt. By “almost cut in half”, I mean that she was partially eviscerated. A section of bowel which had emerged, later died and had to be resected.

The young lad was not so lucky. His face was shattered. By a miracle of modern medical science, in a series of lengthy operations, he was reconstructed, although his forehead had to be left open and loose for a time, to allow his brain to swell, and for the swelling to recede.

A few weeks after the accident, they found his nose. The doctors thought that it had been ripped off when he was first admitted, but eventually it was found mashed into his face. They managed to pull it out to its correct position, and he now looks like any other teenage lad, with a few scars. He has also been left with cognitive difficulties, from which he will never recover.

That brings us neatly to the point.

On the 4th of March, Justice Minister Lord Faulks defended the 600% court fee rises.

He said: “It is also worth bearing in mind that litigation is very much an optional activity.”

An optional activity.

I have two kids. They are both adults now, but when they were both growing up, I recall them doing all the things kids normally do – playing with toys, riding bikes, drawing, listening to music and annoying their parents (yes you did).

Those are optional activities.

I am now pushing the ripe young age of 50, and whilst my memory is not what it once was (well, actually it was never all that, but you get the drift) I don’t recall either of them doing much litigating.

That said, I don’t recall anyone I know doing much – well, any – litigating. And the reason?

The reason is that litigation is NOT an optional activity for people with high value claims.

It is a highly unpleasant, humiliating and degrading necessity forced onto people whose lives have been torn apart by the fault of a person or organisation. Whether the trigger be an injury or a serious financial loss, people don’t litigate because they are short of something to do on a Saturday afternoon.

They do not wake up one dismal morning and toss a coin between seeing the latest Bond movie at the cinema, or issuing court proceedings for £150,000.

They do it because it is often the only hope they have to restore their lives.

The words “out of touch” have, of necessity, been so over employed in recent times to describe the Government, that they have now completely lost their sting. However, pronouncements such as the above remark made by Lord Faulks, drip with the naked contempt of a man who is both bored and irked at being expected, yet again, to justify his Government’s latest cash cow.

I am sure both myself and my clients would be interested to know who Lord Faulks will be suing this weekend.

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WHAT IS THE DEFINITION OF HYPOCRISY?

The Merriam-Webster dictionary defines it as follows: “noun hy•poc•ri•sy \hi-ˈpä-krə-sē also hī-\: the behavior of people who do things that they tell other people not to do : behavior that does not agree with what someone claims to believe or feel”.

According to the Cambridge online dictionary, the meaning of hypocrisy is: “noun [U] uk /hɪˈpɒk.rɪ.si/ us /-ˈpɑː.krə-/ disapproving – a situation in which someone pretends to believe something that they do not really believe, or that is the opposite of what they do or say at another time: There’s one rule for her and another rule for everyone else and it’s sheer hypocrisy”.

Not the traditional opening to a legal blog, but not an unexpected start to an article about the Government, some would say.

The idea for this article came to me last week when I picked up a court order for a provisional assessment hearing.

For those who don’t know, provisional assessment is a relatively new method of assessment of legal costs. In essence, a Judge sits down with the legal bill, a sharp pencil and a cup of strong coffee, and doesn’t stop scribbling until all the fat has been squeezed out of the bill. The intention is to replace detailed assessment hearings – no parties present, no pontificating barristers (sorry barristers) and shorter assessments. In fact 2 hours should more than do for most assessments of bills from £15,000 to £50,000.

Anyway, parking that tangent for a moment, the order stated, as they all do, that the receiving party must pay a fee of £675 for the privilege of having their bill assessed. Not that that is the problem. Indeed far from it – all fine so far.

Where the problem lies, is when you look at recoverable legal fee reductions driven remorselessly by the government in 2013, for no apparent reason other than to please insurers.

For all road traffic injury claims of a value of up to £10,000, from July 2013, the legal fees recoverable by the claimant are £500.

Just to put that in perspective, an injury claim worth £10,000 involves an extended period of pain and suffering and often a period of loss of earnings or care provided by relatives. Often cases worth this amount require more than one medical report to prove the value, because recovery is not as quick as hoped. That in itself usually means that the case takes upwards of a year to settle.

Let’s assume that the injury is (say) a frozen shoulder worth around £5800 to £9400. The Judicial College Guidelines, which sets that value against the injury, also says this:
“Frozen shoulder with limitation of movement and discomfort with symptoms persisting for about two years. Also soft tissue injuries with more than minimal symptoms persisting after two years but not permanent.”

So the injury takes 2 years to settle to the point where the claim can be resolved; remember that if you settle your client’s claim before they have substantially recovered, you could be guilty of professional negligence.

So, in summary (and coming back to our tangent sitting nice and cosy on the back burner) 2 hours of a judge’s time is worth £675. However for a personal injury practitioner trying to do the best for his client against an insurer who is often denying liability, their 2 years of work on that case is worth (wait for it….) £500.

£675 – 2 hours of court time

£500 – 2 years of solicitor time.

Hmm. We’ll come back to that later.

And now the point of the article, which is, and isn’t, the definition of hypocrisy.

Recently the MOJ announced a huge court fee rise which takes effect from Monday 9th March 2015.

And no, I’m not overworking my superlatives, unless you consider that “600%” is not huge. Forgetting for the moment that court fees were increased in April 2014, less than a year ago, Justice Minister Shailesh Vara, says that court fee increases of 600% are “no serious risk to legal services”

Well quite!

How could increasing a court fee from £1,515 to £10,000 on a £200,000 claim (an increase of £8,485, or 560%) possibly affect access to justice? You may think “well he’s just picked the top figure for maximum impact”. Guilty as charged, I’m afraid.

The increase for a claim of £50,000 is a paltry £1,890, or 310% (£610 – £2500).

Judges are incandescent at the proposal, and have pointed out that the proposed fees are 25 to 100 times greater than those payable in New York.

How can a Government that fights ferociously to reduce recoverable legal costs to £500 for cases that take up to and over a year to complete, argue at the same time that 600% increases of court fees are also justifiable?

Their reason cannot be because the fixed costs regime is the right thing to do. And how do we know that? Because the Government decided last week not to extend this to insolvency, because the Government agrees “more time is needed”.

So their reason is that “more time is needed”.

Insolvency practitioners have known about this since 2010, when these changes were first mooted. How much time do insolvency practitioners need? 10 years? A generation? More to the point, should insolvency practitioners be offended, that the Government say that they need more time to get their heads around changes forced on the PI sector in a few months, than it originally took them to qualify as lawyers?

What possible reason can there be for the Government not wanting to extend the low fixed fee regime to insolvency?

All becomes clear when you recognise that the Inland Revenue is one of the largest creditors in the country in insolvency proceedings . The Government doesn’t want to reduce its own income from insolvency work by imposing on its own departments similar fee cuts to those it forced onto personal injury practitioners.

So, when it says that £500 is a reasonable sum of money for a claimant solicitor dealing with a case over a period of up to or over a year, what it really means of course, is that that figure isn’t nearly enough (certainly not sufficient for its insolvency lawyers), but suits the Government’s pro-insurer agenda.

Their arguments that fee increases of 600% will not seriously affect the legal sector, are about as credible as the ATF agents driving tanks at the walls of the Koresh compound in Waco, in 1993, shouting over loudhailers “this is not a raid”.

Really?

To appreciate how ridiculous the Government’s stated position is, you only need look at their recent increase of employment tribunal fees to a maximum of £950, which has led to a 79% reduction in tribunal cases – hardly a panacea for industrial harmony.

Still, if Mr Vara says it with confidence, maybe he’s right. Or maybe they’re just driving the same skinflint agenda, at the expense of the fabric of society.

How can all this possibly be explained? Some believe that they are trying to stamp out claims altogether. Maybe this is the ultimate manifestation of the Big Society – if you’ve been screwed by a debtor or injured by a negligent employer, turn the other cheek – pull your socks up Britain and just get on with it.

Either way, to argue that solicitors are more than adequately remunerated for running road traffic injury cases with fees of £500 (just let’s not apply them to Government work), and then that court fees need to go up by 600%, would admirably suffice as a new definition of hypocrisy.

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ONLINE DISPUTE RESOLUTION – INSPIRED INNOVATION OR BUDGET (IN)JUSTICE?

This week, Shadow Justice Minister, Sadiq Khan MP, accused ministers of avoiding answering his parliamentary questions on the growth of unrepresented parties in court. He had been seeking, as long ago as October, information on how many cases involved unrepresented litigants in the last 4 years.

So far the Government has not answered.

No surprise there.

The number of unrepresented parties in court has soared, largely due to Government withdrawal of legal aid, and the increase in the small claims limit to £10,000. It’s no surprise they don’t want to answer difficult questions.

Meanwhile the Civil Justice Council recently recommended addressing the problem by replacing the Small Claims system (and in fact the system for all claims up to £25,000) with Online Dispute Resolution (ODR).

The title of the report is “Online Dispute Resolution for Low Value Civil Claims”.

According to the report, low value claims are those below a value of £25,000.

The Government’s own figure for the average annual wage is approximately £23,000*.

Leaving aside the fact that £25,000 is for many a life changing sum, and, according to the Government’s own figures, more than a year’s earnings, the CJC’s classification of low value claims suggests that either they have borrowed the classification from the Government**, or they are as out of touch as the Government, or both.

This could be a good thing (ODR, not the CJC being out of touch), provided it’s done properly. But then this proposal seeks to place the bulk of the legal process for money claims of up to £25,000 in the hands of software developers. There are now, and will always be situations that do not fit the box; if not, we wouldn’t have a precedent based legal system, and it’s difficult to see how software decision trees can be successfully applied to legal problems. Is the next step to be online self diagnosis? What if you tick the wrong box and end up with  diabetes instead of cancer?

It is all very well de-skilling the court process, and even judicial staff, but you can’t “de-skill” the law – no dumbing down of the legal process will change the law, nor its applicability.

Furthermore, the Government aren’t exactly known for their track record with successfully implementing new computer systems (amongst them, the NHS, Department of Transport, DVLA, DEFRA, NOMIS, MOD DII, Identity Cards and others).

The Government have been responsible for a dramatic reduction in access to justice – criminal legal aid, family legal aid, civil litigation, small claims, employment tribunals, to name but the headline acts.

All of these have served to narrow the scope of peoples’ rights and their access to legal redress. It is no surprise that this chiefly hits those of lesser means. So a cheap, efficient dispute resolution system is a good thing, provided people do not hemorrhage more of their legal rights in the process. Any system which cuts corners, sacrificing detail for cost cutting, risks producing the wrong decision. Even the Master of the Rolls thinks so.

Those with good cases could lose or not have their cases properly dealt with simply because the evidence was not presented properly. This has already been seen to happen with the Government’s solution to reducing the cost of running road traffic accident claims .

If done properly, this could work, but peoples’ rights are at stake, and another botch job for no reason other than to alleviate pressure on a beleaguered court system will not serve peoples’ interests well.

People will still need the opportunity to take their own professional advice and have their case prepared properly.

We await developments with cautious curiosity.

Thanks for reading, and if you enjoyed this post, please consider sharing it on G+

Dean V Talbot F.C.I.L.Ex.

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*”Households Below Average Income An analysis of the income distribution 1994/95 – 2012/13″
**Pre-Action Protocol for Low Value Personal Injury (Employers’ Liability and Public Liability) Claims S 2.1, and Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents from 31 July 2013 S 1.2(1)a

Legal representation is no longer a right (or is it…?)

Don’t take it from me – that’s what 87% of lawyers who were questioned, think: Furthermore, more than 79% of those lawyers surveyed believe that de-skilling is inevitable. Not great when the customer needs things done properly.

For those who don’t know, the English and Welsh legal system has been systematically pulled apart over the last 2 years and reconstructed. Well, partly reconstructed.

In short, criminal legal aid funding has been dramatically reduced, family legal aid has been more or less annihilated (except for some few exceptional cases), and civil litigation has been changed beyond recognition, making it harder for ordinary people to enforce their rights.

The most talked about area of civil litigation is injury. Whilst people who have suffered injuries at others’ hands now have a much harder job proving their case, and will no longer be able to keep all of their compensation, this article does not concern injuries, but in fact deals with one area which is often overlooked – small business and consumer claims.

Some examples:

• That repeat customer who refuses to pay his bills;

• That computer that packed up 1 month after you bought it;

• The new conservatory that sprang a leak;

• The car salesman who conveniently forgot to tell you that your car had a very expensive fault before you bought it.

Many people are not aware that the Small Claims Limit was raised last year from £5,000 to £10,000. That means that since April 2013, if you have a contract claim of up to £10,000 (including, but not exclusively, as above) you either pay to go to court yourself, or write it off.

I’ll say that again. You write it off.

Writing off a debt of up to £10,000 is a choice many people make, because if they hire a solicitor to help them, even if they win, they can’t recover their legal costs from the loser. So they could recover their (say) £9,000 debt, but may have paid (say) £3,000 – £4,000 to a solicitor to achieve that. What’s the point, especially when it can take 1-2 years to get there.

The logical outcome of such changes is easy to envisage – people who can’t afford solicitors either don’t take action or run their cases themselves. Many people need to consult a lawyer, but can’t afford to do so, and so don’t.

Many people on the other hand are brave enough to run cases themselves, and many get it wrong, because (surprise, surprise) the law is complex. Even the Master of the Rolls, who ushered in most of the plethora of changes in the law over the last two years, believes that winnable cases WILL be lost because people are running them without legal assistance.

The Court of Appeal not only agrees, but their frustration at having to explain the law to those who cannot afford a solicitor, is all too evident.

The good news is that there are now alternatives which will provide you with the expert legal help you need, at a fraction of the cost of a conventional solicitor’s practice.

Going back to the article at the top, the 87% are right. And wrong.

Government policy IS forcing the public further away from access to justice, BUT the market is adapting to respond to those changes. If you want to know more, you can contact me here.

Thanks for reading, and if you enjoyed this post, please consider sharing it on G+

Dean V Talbot F.C.I.L.Ex.

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