The Proposed Capping Of Legal Fees
The Lord Chancellor, Jack Straw, has spoken on the subject of no win no fee lawyers, and admits that he is considering putting a limit on the charges that compensation claimants are often forced to pay.
During the Labour party conference, Jack Straw told the Labour Party that no win no fee lawyers often acted in a way that was scandalous, and that the 'Ramping up' of fees, was not uncommon.
The chancellor said that he was considering capping the success fees that lawyers could charge, and that he was going to pay particular attention to the additional 'uplift,' which can be as much as 100% of their original percentage. The reason behind this, is that the lawyers need to make up for the cases that they lose out on.
Conditional fees were first introduced by the conservative government in 1993, with the success fee being set at a maximum of 20%. This put lawyers in a less than advantageous position though, where they had to win five out of every six cases that were taken, in order to merely break even. Subsequently it was decided that they could charge up to twice as much as this, in the event of a victory.
The case is very much one where the lawyers are acting on instruction from parliament, and so therefore, a negative reaction to such a slur is to be expected. Lawyers are likely to resent any suggestion that they are profiteering. The whole reason that no win no fee was introduced in the first place, is because the right to legal aid for people who had suffered from personal injury, was completely removed.
Another complaint, is that no win no fee terms, have been used in cases where claimants could have afforded to fund a case themselves. This is done in the knowledge that the amount recovered from a defendant,. Is going to be doubled, due to a rule that states that the loser pays the winners costs. It is viewed that such procedure puts defendants under pressure to settle.
The reduction of success fees, along with pandering to the feelings of anti-lawyer criticism, is going t have a positive effect on the NHS, because they spend a great deal of money every year, refunding the legal costs of claimants.
There is a problem whereby people that have right to make a legal claim will find it more and more difficult to find representation, due to lawyers only wanting to represent, in cases where they are guaranteed to succeed.
Mr Straw stated that he felt it important that a balance was achieved, in showing fairness between the rights of the accused party, and the right of the victim.