Recoverability of Success Fees and ATE June 26, 2009
Posted by Richard Moorhead in : Costs, Jackson Review, no win no fee , trackbackLord Justice Jackson, whilst maintaining his open-mindedness, gives a fairly firm steer away from the idea that a claimant’s damages in personal injury cases should be sacrosanct. Whilst he notes APIL’s opposition to it and also accepting that it might be established consumer expectation that they receive 100% of their damages, he points out that:
- some ‘APIL’ solicitors advance no cost shifting in the context of collective actions which would require the abandonment of sacrosanct damages (para. 9.24, page 113);
- the recoverability of success fees and premiums may have allowed litigation to move too far away from considerations of proportionality (para. 5.1iii, page 150);
- without market pressure there is no effective market pressure on success fees (para. 3.1, page 478);
- “There can be no doubt… [that recoverability of success fees and ATE premiums]…massively increased the costs burdens upon defendants.” (para. 4.1, page 481). The change in colour of Sir Rupert’s language may be telling.
Of course these assumptions may be criticised by some. Further, he seems to accept the view that pre-recoverability the system worked without problems (although in fact what little research was done did not suggest this was true from the consumer’s perspective). Nevertheless the implication is clear: success fees and ATE premiums may yet become irrecoverable and so need to be paid out of a claimants damages, possibly with a cap as to how far damages can be reduced by success fees.
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