AFFORDABLE LAW

The Legal Services Board recently published a survey that revealed that 87% of small businesses considered that lawyers were not cost effective in resolving legal issues.

Furthermore, the survey found that only 10% of small businesses had used lawyers in the past year, a reduction of 100% on the year before.

Legal advice is often a “stress purchase”, particularly when obtained in the aftermath of an accident or dispute. A solicitor’s charging structure has traditionally been on the basis of hourly rates, and whilst there is considerable evidence of change to more affordable models, this survey suggests that small businesses still do not see legal advice generally as value for money.

This is why Small Claims Assistance offers legal assistance and advice at low fixed fees, which are proportionate to the amount in dispute.

Since I started Small Claims Assistance, I have seen numerous small businesses who have tried to handle complex litigation by themselves, and have, at best, delayed the resolution of their case, and, at worst, lost a winnable case because they did not understand the technicalities of the law. In between are a host of litigants who cost themselves money by making mistakes, some of which later have to apply to the court to rectify, and some of which cannot be rectified.

In the face of a legal “taxi meter” ticking at an hourly rate, it appears that many small businesses prefer to throw the dice, even when opposed by lawyers paid for by their opponent.

Such risks however are unnecessary with legal advice offered at low and proportionate fixed fees, whether that be £50 for drafting a Claim Form and detailed Particulars of Claim, or £25 for a brief advice. I am happy to assist with all types of money claims, whether pursued or defended, and regardless of whether they have just commenced, or are close to trial.

Litigating in person, with all the risks that entails to your business, in order to avoid substantial further unrecoverable legal costs, is understandable. Taking the same risks when your cost exposure is a small fraction of your loss, is not.

At Small Claims Assistance, you are represented by myself, a fully qualified and insured lawyer, with partner level experience at paralegal prices.

If you need affordable legal help resolving a contractual claim, call 07947 226637, or email me on enquiries@smallclaimsassistance.co.uk.

SCA-Logo TM

 

Advertisements

Justice Without Lawyers

Justice without lawyers. How does that work then? Probably about as well as a healthcare system without home grown nurses.

It is widely considered that one of the main drivers of the enormous NHS trust deficits is Government cuts to training places. All very well in theory, but at 1 o’clock in the morning when a busy trauma department is filling up with patients and needs staff, what are they supposed to do? Turn patients away? Of course not. Their only alternative is to turn to agency staff, a much more expensive option, but often the only option. Worse still, it’s not like the government couldn’t have seen this coming.

Returning to the law, the Government have been reducing the general public’s access to legal services for going on three years now, and one of their wheezes for this year, has been virtualisation of the courts and court process. In other words, move the litigation process online, reduce the staffing bill, and close the courts.

So, having created an advice vacuum with their policies of the last 2-3 years the Government is talking about Online Dispute Resolution (ODR) as if it is a panacea to cure the very vacuum they have created, and yet it obviously cannot possibly be any such thing. What it will actually do is replace the system we have now; people using physical court buildings and staff to process and adjudicate their disputes, with a virtual place and process. It will not, and cannot, replace legal advice. To suggest otherwise, is analogous to suggesting that if you close down hospitals and take doctors out of the equation, you can replace them with a self-diagnosis and prescription website. Utter, utter, tripe.

I left partnership in a firm to set up my own practice 6 months ago, which is aimed at assisting small businesses and consumers with contractual disputes at low fixed fees, and which was prompted by another government policy, their doubling of the small claims limit 30 months ago to £10,000. The carnage I have seen, and helped people through, in the last 6 months has to be seen to be believed:

– all caused by the same mindset that has produced this announcement- The justice system therefore needs to adapt to make sure that people can still access it without lawyers by a process designed to work without lawyers (The Right Hon. The Lord Thomas Of Cwmgiedd Lord Chief Justice Of England And Wales, 25th September 2015) – an absence of lawyers. Had the small claims limit not been raised, many of those people could have afforded lawyers, because if successful, they could have recovered the money they were spending on legal fees.

In the last month, I was hired by a client less than a month before her trial, to try to help her. She was involved in an acrimonious contractual dispute with a business lender. It was only at that point that she realised that she was in trouble. She had a very good argument that the case, which was run (badly) by professional lawyers against her, was unfounded. Unfortunately, because she had only a limited understanding of the law, she was blind to a critical development in the case which destroyed entirely her chances of defending the case, only a couple of months after she started. Had she been legally trained, she would have seen it immediately. Even the judge at the final hearing told her that theoretically, she had a good argument, but that she had lost the chance to capitalise upon it. Had she hired a lawyer a year ago, when the dispute first began, she may have avoided a substantial judgement against her which was awarded a week ago.

Her position would have been no different had the court been online.

The Government’s attitude to litigation is that it is very much an optional activity”. I doubt that my client felt that she had much option when she was trying, and failing, to save her business without the help she needed, and could not afford.

And yet the government persists in pursuing policies time and again which withdraw legal help from all but those with the money to afford it. Even GPs have reported an increasing number of consultations with patients who have unresolved legal needs, which are adversely affecting their life, their mood and therefore their health.

Perhaps perversely, this all reminds me of a brilliant scene in Blackadder 4:

Blackadder – Would this brilliant plan involve us climbing over the top of the trenches and walking very slowly towards the enemy?”
Darling – How did you know that, Blackadder? It’s classified information.
Blackadder – It’s the same plan that we used last time, sir. And the seventeen times before that.
Melchett – E-e-exactly! And that’s what is so brilliant about it. It will catch them off-guard. Doing exactly what we have done eighteen times before will be the last thing they’ll expect us to do this time”.

And there is the problem. They keep repeating the same behaviour, expecting different results:

This is particularly so when the Government have already admitted that they pushed many of these changes through without any, or any effective, consultation.

Most of their reforms so far have had the cumulative effect of removing access to legal representation, advice and assistance. Taking lawyers away from people has caused this – saying that they will have to get used to it is not going to fix the problem, and is only going to make it worse.

At the start of this year, 87% of lawyers thought that legal representation was no longer a right. The LCJ appears to have just given that view his blessing!

This is the clearest confirmation yet that the Government does not WANT people to have legal representation. In fact, it mirrors their stance on Judicial Review, where restricting the scope of JR would reduce the likelihood of challenge to Government policy.

For the last six years, the Government has been behaving like a cowardly schoolyard bully, trying to ensure that the fight is unfair, and is rigged in their favour.

ODR cannot replace the need for legal representation, and neither can any “virtual” court system the Government intends to introduce. Representation, advice and legal assistance will still be needed, whatever system the Government puts online, because, just as in medicine, people need the help of experts in their field. They cannot solve complex legal problems by navigating a few decision trees online, and furthermore, regardless of the views of the LCJ, unrepresented litigants taking action against a large business (who will very likely still be legally represented), or vice versa, will still be at a disadvantage to the represented party, as in my client’s case.

As the Guardian says in their article above What the figures do not convey is the sheer human misery of being unable to get legal advice”.

In May, I wrote an article entitled “The Sick Society”, in which I made a number of predictions as to the likely path of society if this Government’s judicial policy does not change. None of those predictions have changed, but there is a growing wealth of evidence that they are already happening. They are:

• 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.

Parliament’s own report into the impact of these changes, the “Impact of changes to civil legal aid under Part 1 of the Legal Aid, Sentencing and Punishment of Offenders Act 2012” states:

“80. Witnesses observed that demand for [legal] services was going up, partly as a result of the legal aid reforms but also because of other reasons such as changes in the benefits system and immigration rules, pressure on housing and rising use of zero hours contracts.[138]”

This isn’t just my opinion. It is happening.

Now.

Justice is, and always has been, at the core of our society. So instead of saying that people will have to get used to life without lawyers, the Government should be finding a way to restore contact between the general public and the legal services they once had, but have, under the last two Governments, lost.

It is truly a sad reflection of our leadership, that all of this is happening in the year in which falls the 800th anniversary of the signing of the Magna Carta, but this fundamental affront to our proud legal heritage also highlights the clear agenda of the incumbents; that justice should no longer be defined as “Just behaviour or treatment: a concern for justice, peace, and genuine respect for people” [Oxford Online Dictionary], but as a commodity to be bought only by those with sufficient means to afford it.

Everyone else will have to DIY.

Meanwhile, I have to get back to work. My hot water boiler has packed up, and I’m sure that with a £5 toolkit and a modicum of common sense, I can replace it and have the taps running hot by tea time…

If you have enjoyed this article, please feel free to share.

Thanks for reading.

Dean

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?

Print

 

 

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

Print

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.

Print

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.

Print

*”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.

Print

Help for LIPs

In October, Simon Hughes announced that the Government would be providing help for LIPs (Litigants In Person; that is, unrepresented claimants or defendants). The Government have pledged to create a network of advice centres within court buildings to help people who are running their own cases.

This has been prompted largely by the explosion of unrepresented family court litigants following the almost complete elimination of legal aid for matrimonial cases. The courts are choking with people trying to enforce their rights without legal help and, because they are unrepresented and therefore have no legal advice, thousands of cases are taking longer, significantly increasing the workload for the courts. This applies not only to family work but also small claims – the Government increased the small claims limit last April from £5,000 to £10,000, meaning that much larger and more complex financial disputes must now be run without representation by lawyers, as the legal fees your lawyer would run up in representing you cannot be claimed back even if you are successful in the small claims court.

The announcement that the Government are introducing advice centres is therefore welcome news, but only insofar as people will have advice at court. People need advice before and during the running of a case however, and many believe that the provision of advice centres in courts is nothing more than a sticking plaster on a broken leg.

In disputes over thousands of £s, it is important for people to receive expert legal advice throughout the course of their case. Court fees also increased significantly last year, and for those risking a payment of over £500.00 to the court, just to get their case to hearing, they need more than just some advice in the hour before the trial; they need proper preparation. It is hoped that this will be just the first step in the return of access to justice to the general public. You can read more about this here….  http://www.lawgazette.co.uk/news/hughes-pledges-14m-to-help-lips/5044568.article

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

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

Print