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Fixed costs proposals for clinical negligence cases likely to apply to lower value claims only

Posted: 24/10/2016

Over the last year there has been much speculation, discussion and lobbying around Department of Health proposals to apply fixed fees for legal work carried out in clinical negligence claims. The initial ideas suggested that this would apply to cases valued up to £250,000 in damages – which would cover a high proportion of clinical negligence claims in this country.

Whilst there is clearly some merit in controlling legal costs in litigation, many claimant clinical negligence lawyers are concerned that the introduction of such a scheme would have the effect of further encouraging defendants to drag out and dispute claims so that they become uneconomic to pursue, and that those with genuine but complicated and lower value claims will either be denied access to justice, or lose most of their damages in legal costs. There is also a concern that there will be a potential reduction in patient safety as the checks and balances imposed by litigation when unacceptable errors are made may well be removed if lower value claims are not pursued.

Recent Department of Health minutes suggest that the plans may only apply to cases with a damages value of up to £25,000. The Law Society expressed the view (shared by many clinical negligence solicitors) that whilst the decision to reduce the scope of cases covered would be in the interest of justice, the changes are still premature as the impact of earlier changes has not been assessed. There are indications that the costs reforms introduced in 2013 are working as intended in reducing legal costs, but because of the time that litigation takes to proceed, it is too early to measure their success.

The Law Society has maintained that if the Government decides to introduce a fixed-cost scheme, it should only apply to:

  • non-complex, low-value clinical negligence cases;
  • cases with damages up to the value of £25,000;
  • cases where there is an admission of full liability.

Chief executive of The Law Society, Catherine Dixon said: “Clinical negligence claims are brought by people who have been injured through no fault of their own as a result of negligent medical care. They need specialist legal advice to help them get the compensation they are entitled to in law.”

However, she warned: “Even with this lower limit, patients harmed in hospital could be denied the compensation they are entitled to in law if fixed recoverable costs are introduced for complex clinical negligence claims or if the level of fixed cost is set too low.”

Philippa Luscombe, partner in the clinical negligence team at Penningtons Manches, comments: “It is in everyone’s interest for clinical negligence cases to proceed quickly and cost effectively to an appropriate resolution. The changes to costs rules introduced in 2013 have already had quite an impact on the conduct of litigation in this area in controlling costs. However, the reality is that there is often no relationship between the complexity of the facts and medical issues in a case and the value of that case in damages. Often a high value case can be concluded with relatively low cost if the issues are clear and there is an early admission of liability, but a lower value case – for example the trauma of the loss of a baby – can have very complicated medical and factual issues and high legal costs. To define what legal costs an individual can incur by the money value of their claim risks denying access to justice to those most affected by unacceptable errors – and potentially those errors not being highlighted and addressed to prevent further incidents.

“Fixed costs may encourage defendants in smaller cases to delay or deny cases they should admit in the hope that claimants will discontinue (which happens enough as things stand), and so if this scheme is introduced, careful consideration needs to be given to complicated cases – particularly those involving the death of a family member and penalties for poor conduct on either side.”

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Penningtons Manches Cooper LLP