Fixed costs proposed for clinical negligence claims

In late January, the Department of Health published a proposal to limit fees charged by lawyers who represent patients for medical negligence. The suggested cap of £25,000 will apply to fixed recoverable costs.

Speaking on behalf of the government, Health Minister Maria Caulfield highlighted the disproportionate rise in fees over recent years. According to an independent review that advises the Civil Justice Council, legal bills for clinical negligence claims have risen, but compensation payments have decreased.

Ministers want costs to be more proportionate than currently. They describe the proposed payment system as fair remuneration for administering claims and representing patients.

clinical negligence needle

Interested parties can voice their opinion(s) until 24th April 2022. Sir Rupert Jackson, a retired justice, is head of the review. Years ago, as Lord Justice of Appeal, he examined costs and recommended changes to legal aid for general civil litigation.

Wide payments gap

During the financial year to April 2021, patients’ legal costs in negligence cases were twice as much as compensation paid. Claimants received an average of £11,198. However, the average bill presented by their lawyers was almost double that, some £22,124.

In other areas of personal injury law, fixed recoverable costs are already commonplace. Speaking in Parliament, Mrs Caulfield – once a nursing sister – suggested the scheme would speed up processing and simplify access to legal support in genuine cases. She also admitted that the NHS could save £454 million over ten years.

The plans facilitate the early exchange of evidence: solicitors on both sides will be eligible for efficiency incentives but liable to sanctions if their performance falls short. In particular, the new scheme regime encourages quick agreements on the causes, liability and amount due, or quantum.

Two-track system

Legalities would follow either a standard or a light track depending on the complexity of each case. Two meetings would take place between the parties involved, under the guidance of a neutral barrister. The aim would be to settle outside court wherever possible without costly full hearings.

Claims have been taking progressively longer to settle. Under the new scheme, it should take no longer than forty-four weeks to progress from the service of an initial claim letter to the mandatory neutral evaluation stage.

The plans outline using template letters and model expert reports in the initial presentation of evidence. Next, the defendant, i.e. healthcare provider, must acknowledge receipt of the claim within three weeks. Then, within six months, they would have to admit liability and suggest a settlement – or notify their intention to contest the claim. Finally, patients or their legal representatives would have two weeks to confirm receipt and six weeks to respond fully to the defendant’s reply.

Patients’ legal costs are usually awarded against the defendant if found negligent. Under the standard track, the cap will be £6,000 plus 20 per cent of the amount awarded in damages. The light track limits fees to £1,500 plus 10 per cent of the award.

In both cases, the damage payment receivable by successful litigants remains intact. Most legal action is under a no-win-no-fee arrangement.

Cases involving three or more expert witnesses or multiple defendants will not be subject to the above limits. Exceptions also apply to stillbirths, neonatal deaths and when the defendant highlights the restriction as a potential issue, given the nature of the alleged mistreatment.

Mixed reaction

Predictably, lawyers’ groups recorded their dismay at the announcement. Concerns were that the plans could stop victims of medical negligence from receiving fair compensation.

Lawyers questioned why the government had not dealt more robustly with unnecessary and problematic delays in responding to claims. Handling claims more efficiently would decrease costs. Furthermore, while the streamlined process limits the number of experts using model reports, there is no limit to the fees expert witnesses could charge.

The Association of Personal Injury Lawyers depicted a significant hurdle for patients to negotiate. Its spokesperson, Suzanne Trask, accused the government of failing to address patient safety issues and doing nothing to address the financial cost and human misery suffered by victims of medical mistreatment. She emphasised that negligence settlements were only a tiny proportion of the NHS budget.

In contrast, one defence group considered that the proposals did not go far enough. It urged a rapid rollout and extra measures to minimise the adversarial face of litigation.

Ministers countered that the proposals would not affect access to justice for injured patients.

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