Please remember to turn off the lights

What does the Young Report mean for the legal profession, the insurance industry and the legal costs world?

Lord Young recommends the implementation of Lord Justice Jackson’s Costs Report:

“It is my firm belief that the government should adopt Lord Justice Jackson’s proposals as soon as possible”

The Government has approved the Young Report with the Prime Minister saying:

“Lord Young has come forward with a wide range of far reaching proposals which this Government fully supports”

Lord Young has also proposed the expansion of the RTA claims process into other personal injury and lower value clinical negligence claims. Separately, the Government has advised it wants to press ahead with Lord Justice Jackson’s proposals to end the recoverability of success fees and ATE insurance premiums as a matter of urgency.

It is not quite clear how extension of the RTA claims process would tie in with Jackson’s proposal to introduce fixed fees for all stages of fast-track matters. Presumably there would be a different fixed fee system for those cases which fall outside the extended claims process.

For claimant lawyers the future is clear. The end to recoverability of success fees will greatly reduce their fee income.

For defendant lawyers the future is less easy to predict. The expansion of the current claims process may reduce litigation generally and reduce work volumes.

Insurers will hope that the proposed increase in general damages will be more than off-set by the end to recoverability of success fees and ATE premiums.

And those working in the legal costs world? Well, for those dealing with party and party costs, most will lose their jobs.

How quickly? Lord Young gives a target date of April 2012 for the extension of the claims process. Allowing about a six-month run-off period for older cases (the change will not be retrospective) gives us a date about two years from today when the impact will start to seriously bite in terms of work volumes. That means a couple of years from now most of the law costs draftsmen, legal costs negotiators and costs lawyers (yes, you too) reading this will no longer be reading the Legal Costs Blog as it will be irrelevant to whatever new line of work they are then in.

I’m planning on retraining as an acrylic nail technician (trust me, that’s where the big money will be). As for the rest of you, best of luck.

Oh, wait.

Michael Cook, speaking at this years’ Association of Law Costs Draftsmen’s National Conference said he saw Jackson as a “costs lawyer’s charter” for reviving “ancient skills” such as budgeting, costs management and solicitor/own client work, with costs management being “the costs lawyer’s dream”. He concluded:

“Let’s not have any more talk about Jackson putting costs draftsmen out of business.”

I guess one of us is going to end up looking pretty silly.

7 thoughts on “Please remember to turn off the lights

  1. And with all the reduced costs for insurers will they pass on those savings in the form of reduced premiums? Will they heck as like.

  2. Costs budgeting and costs management. Someone has made a fortune on the conference circuit discussing theses issues!

    I must come across about 2 cases a year in which I need to address the above.

  3. Do you honestly believe Simon, that if Jackson’s recommendations are implemented, Claimant’s who have genuine serious cases not making claims (as they are put off by the expense of paying their own ATE Premium as well as a % of their damages going to their Solicitors), is better than some Claimant’s making claims they either aren’t entitled to, or insurers settling costs on cases at a higher figure than they are happy with?

    When is the last time a major insurer went bust? Are insurers making a loss due to the extra-ordinary costs involved in legal proceedings?

    Jackson’s introduction states “I am asked to review the rules and principals governing the costs of civil litigation and to make recommendations in order to promote access to justice at a proportionate cost.”

    I don’t wish to appear bias or sarcastic here, but if a Defendant has a good case (one which they think they should win), they defend it to Trial and obtain a costs order in their favour…. Isn’t that the way “the loser pays” principal works?

    So who exactly is being precluded from access to justice at a proportionate cost? The poor faceless insurer, with millions/billions of pounds at their disposal and Top 100 legal firms tripping over themselves to do their work at reduced rates?

    Or the severely disabled Claimant, whose life has been changed forever, and if Jackson’s recommendations are implemented, who will think twice about pursuing a claim for damages?

    Do people want to read about very sad, very traumatic accidents, after which people struggle in their every day lives? Or do people like to read about ambulance chasers, a compensation culture, and funny stories about people being awarded £0000’s for falling of a chair? How can a Claimant Solicitor, when faced with that, win an unwinable war?

    Whilst I read this blog ever day, and revel in its tongue in cheek nature and smile at Simon’s puns, Jackson is a different animal all together. Having never practiced in PI or Clin Neg, nor having any significant dealing with either field after the implementation of the CPR (he was in the TCC from 04 to 07), he has no idea of the day to day practice of a PI or Clin Neg lawyer. And yet he might just be the one to put the majority of them out of business…

    Now is the winter of discontent.

  4. Simon, it won’t be you looking silly, just poor (hope I’m wrong). I shudder to be honest at the stuff Michael Cook comes out with these days. “Ancient skills” my arse. Nail parlours are good but I think the real money is in the orthodontist business. Hourly rates that would make the magic circle jealous.

  5. Pingback: End of the legal costs industry? |

Leave a Reply

Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>