LEIG expresses concerns at the consultation process used for the Ministry of Justice Consultation pa, 18 February 2010
Legal Expenses Insurance Group
News Release : 18 February 2010
Legal Expenses Insurance Group
News Release: 18 February 2010
LEIG expresses concerns at the consultation process used for the Ministry of Justice Consultation paper CP1/2010 Controlling costs in defamation proceedings. The MoJ issued this consultation paper in January and gave just 4 weeks for responses.
Tony Baker, LEIG Director, commented:
The LEIG is very concerned by the arbitrary reduction in the response time to four weeks as opposed to the usual 12 weeks. This is especially true when no explanation is given and there is no apparent need. A shortened timetable suggests there is little interest in opposition or alternative views.
LEIG has also concerns at some of the data that was presented and a lack of evidence to support the contention that CFAs and ATE insurance encourage more speculative claims to be pursued. Indeed entirely the opposite is true. Solicitors and ATE insurers are only prepared to support cases that they consider have real merit.
Tony Baker added:
Access to justice will be prejudiced. The consultation seems flawed in that the Impact Assessment does not adequately address the concerns of the main group that will be affected by these proposals, i.e. genuine claimants seeking redress.
-ENDS -
Notes for Editors
1. The Legal Expenses Insurance Group (LEIG) was formed in April 2006 by a number of leading legal expenses insurers and intermediaries. The aim of the Group is to work together to protect and advance the rights of claimants to justice and fair levels of compensation. The following companies have to date joined the LEIG:
Albany
Angel assistance
ARAG
DAS
Elite Insurance Company
Financial and Legal
IGI Insurance
LAMP
MSL
Temple Legal Protection
Templeton Insurance
ULR Norwich
It is estimated that members represent in excess of eight million motor legal expense policyholders and over 16 million policyholders in general.
2. Tony Bakers contact details are:
Tony Baker
Tel: 01920 465000
Mobile: 07725 462528
Email: thetonybaker@gmail.com
A jpeg picture is available on request.
3. Website: www.leig.org
4. A copy of the LEIG submission is attached.
Ministry of Justice Consultation paper CP1/2010 Controlling costs in defamation proceedings LEIG response
The Legal Expenses Insurance Group (LEIG) was formed in April 2006 by a number of leading legal expenses insurers and intermediaries. The aim of the Group is to work together to protect and advance the rights of claimants to justice and fair levels of compensation. The following companies are members: Albany, Angel Assistance, ARAG, DAS, Elite Insurance Company, Financial and Legal, IGI Insurance, LAMP, MSL, Temple Legal Protection, Templeton Insurance and ULR Norwich.
The LEIG has decided not to respond to the specific questions raised in the paper as they primarily concern one LEIG member (Temple Legal Protection) and it is understood that they will be submitting a full response.
However, there are some general points that the LEIG would like to make concerning the consultation process.
The LEIG is very concerned by the arbitrary reduction in the response time to four weeks as opposed to the usual 12 weeks. This is especially true when no explanation is given and there is no apparent need.
A shortened timetable suggests there is little interest in opposition or alternative views. A shortened timescale tends to assist those parties who wish to agree the proposals but prejudices those who wish to research and develop reasoned arguments to oppose the proposals or to suggest alternatives.
LEIG has also concerns at some of the data that is presented. The proposal seems to be based on one years data. The sample is too small and unlikely to be representative of the true position of this market.
In the last decade, LEIG is aware that several million pounds of fees, where work was conducted under a CFA, has been written off because the cases have been effectively lost as distinct form being lost at trial. In addition, ATE insurers are very aware that cases are lost since they pay out very significant sums when this happens.
LEIG is not aware of evidence to show that 100% success fees and ATE premiums are, in any way, acting to suffocate the freedom of expression of the press. Indeed there has been a notable reduction in the number of publication cases in the last year.
It does also seem a little perverse that in the 2008 sample, 17.5% of defamation cases were funded by way of a CFA so action is to be taken. A low percentage suggests that defamation cases are a particularly unattractive area of law in which to offer CFAs, due to the inherently complex issues involved. It does undermine the argument that having CFAs unfairly tips the balance in the claimants favour and suppresses journalistic freedom.
There is no evidence to suggest that CFAs and ATE insurance encourage more speculative claims to be pursued. Indeed entirely the opposite is true. Solicitors and ATE insurers are only prepared to support cases that they consider have real merit.
Finally, LEIG notes that the Impact Assessment does not adequately address the concerns regarding the main group that will be affected by these proposals, i.e. the claimants. Access to justice will be prejudiced.
Claimants in publication proceedings are largely private individuals without the funds to seek redress against defamation/privacy through the courts. By restricting success fees to 10%, it is the claimants that will undoubtedly suffer as it will become financially unattractive for both solicitors and barristers to offer CFAs where there is little reward in doing so. This will ultimately restrict access to justice as it is only wealthy individuals that will be able to pay these fees privately.
LEIG considers that the current legislation allowing CFAs, with success fees up to 100% and ATE premiums to be recovered from the opponents, is a good basis for the conduct of litigation. There is a case for this to be subject to more control from the Courts by exercising their powers to reduce success fees where they consider them to be unreasonable. Such a control from the Courts, who have the expertise to judge each case on its merits, is preferable to excessively restrictive legislation.
Tony Baker
Director, LEIG
18 February 2010
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