Proposals to slash legal costs in personal injury claims welcomed

The long-awaited outcome of Lord Justice Jackson's review of civil litigation costs in England and Wales has been broadly welcomed by the British Safety Council.

A number of recommendations, if implemented by Government and the courts, could have a significant impact on the costs of litigation incurred by employers in defending personal injury claims and hopefully help reduce the cost of employer liability insurance.

Other proposals, for example the banning of the payment of referral fees to claims farmers, could have an important part to play in providing the public assurance that our society has not gone compensation crazy. Implementation of the Jackson review recommendations will mean that the vast majority of personal injury claims arising from work-related accidents or ill-health will be subject to fixed costs.

Neal Stone, head of policy & public affairs at the British Safety Council, whilst welcoming the thoroughness of Lord Justice Jackson's review, made clear that there was still a long way to go before employers and injured workers felt the benefit of a reduction in legal costs.

“It is a cardinal principle of our legal system that workers injured or made ill by their work are properly compensated for the damages they have suffered,” he said. “There is something seriously wrong with our legal system where the costs of bringing and defending a personal injury claim far outweigh the compensation for the damage that the injury or ill-health causes.”

“The British Safety Council welcomes a number of the Jackson recommendations including: the proposal to introduce fair and reasonable fixed fees for claimant lawyers in fast track personal injury claims up to £25,000; success fees charged by solicitors in 'no win, no fee' cases to be capped at 25% and paid by claimants from damages; claimants costs in unsuccessful cases should be met either by the claimants or their solicitors as agreed; the payment of referral fees (to claims farmers for example) for personal injury claims should be banned and if not then capped.”

“This review has been a long time in the making and the length of the resulting report, some 580 pages, reflects the unnecessary and costly complexity of the current law. It is regrettable that the review did not include an examination of the benefits to be gained from moving to 'no fault' compensation for work related injury and ill-health.”

Concerns have mounted over the last ten years about the costs of civil litigation including in connection with work-related accidents and ill-health. Although the vast majority of personal injury claims are valued at below £5,000, in a significant number of cases the legal costs of bringing the claim sometimes far outweigh the amount claimed for the damage suffered. The legal costs incurred by a claimant are, on average, an estimated £588.