Legal Aid, Sentencing and Punishment of Offenders Bill

Chris Bryant Excerpts

Wednesday 2nd November 2011 Commons Chamber

[Mr Slaughter]

I began my speech by informing the house how contingency fee agreements came about. Because the Secretary of State has merely repeated that, I will penalise the Minister by taking a minute off his time.

The Secretary of State believes that there are faults in the current system whereby lawyers are unjustly enriched—he may be right, and my right hon. Friend the Member for Blackburn (Mr Straw) and I, and many other hon. Members, would probably agree with him—but let us cure those faults. Let us not throw the baby out with the bathwater.

[Chris Bryant (Rhondda) (Lab)]

Some categories of proceedings are particularly expensive to advance, yet lead to relatively minor awards. For instance, the largest award in a privacy case is £60,000, and below that, £13,000. The vast majority of libel cases end up with awards of less than £100,000. The problem is that in those cases, families such as the Dowlers, and people such as Christopher Jefferies, who was on the radio this morning, would have no chance of access to justice.

[Mr Slaughter]

That is why I will be very pleased to support amendment 163, which is in my hon. Friend’s name. As I have indicated, there are some cases—libel is a good example—when damages are small, but the defamation is important. Under the Secretary of State’s scheme, more than the sum of the damages could therefore be taken in fees.

Let me go through other areas of law, and I will come to privacy at the end if I have time. On clinical negligence, it is unavoidable that there will be good and bad doctors, just as there are good and bad in any profession. It is just and proper that compensation is paid to anyone harmed as a result of inaction, negligence or incompetence when a medical professional fails to live up to their obligations. I say that despite the fact that when the Secretary of State gave the figures, he conflated the cost of damages, claimant costs and defendant costs and pretended that they were a cost figure in themselves, for which he had to make another apology to my right hon. Friend the Member for Tooting (Sadiq Khan).

On professional negligence, taking on a professional is always risky. No one knows the system better. People are never 100% likely to win such cases. Without success fees to compensate for the risk, many such cases will not be brought in future. So who will lose out? It will be the first-time home buyer whose surveyor negligently fails to spot subsidence, the pensioner whose financial adviser negligently makes a high-risk investment, the hard-working small businessman whose accountant negligently fails to prepare accounts and lands him with a huge tax bill that he cannot pay, and the bereaved family whose probate solicitor takes three years to deal with the case and then charges huge fees. Those are the kinds of case that our constituents experience.

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[Chris Bryant]

You are the Parliamentary Private Secretary.

[Mr Wallace]

PPSs are allowed to make points of order. Throughout the proceedings on the Bill Opposition Front Benchers, particularly the hon. Member for Hammersmith (Mr Slaughter), have made points about the perceived failure of Government Front Benchers to declare their interests. However, the hon. Gentleman has failed to point out that on 119 separate occasions the Labour party has received donations from lawyers who make their money from success fees.

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[Mr Djanogly]

Amendments 21, 22, 72, 163, 164 and 165 all seek to undermine a fundamental element of the package of reform of civil litigation funding and costs based on the report prepared on behalf of the judiciary by Sir Rupert Jackson and now included in this Bill—the abolition of recoverability of success fees and after-the-event insurance premiums. I must say that I am rather perplexed by the amendments as in Committee the hon. Member for Hammersmith (Mr Slaughter) agreed that the intention of part 2 is

“perfectly sound, and it is one with which we have a great deal of sympathy.”––[Official Report, Legal Aid, Sentencing and Punishment of Offenders Public Bill Committee, 13 September 2011; c. 501.]

I will also deal with new clause 39, which is on the related but slightly separate matter of recoverable costs for low-value road traffic accident claims.

It is worth emphasising, as the Justice Secretary has just said, that we are not proposing to end conditional fee agreements or no win, no fee deals. What we are addressing is the substantial legal costs that go to lawyers under the current no win, no fee regime. Our reforms are designed to make these legal costs more proportionate, while enabling meritorious claims to be brought. This applies equally to defamation and privacy claims and multinational claims as to other categories of case, but it is worth reminding ourselves of some of the disproportionate costs that have arisen and that emphasise the need for our reforms across the board.

[Chris Bryant]

The Minister referred specifically to defamation and privacy cases. The problem is that in the vast majority of cases—and in every single instance in privacy cases—the awards are so small that if there is no success fee, it will be completely uneconomic for a lawyer to come forward with a CFA. That may not be the Minister’s intention—I take him at his word—but the effect will be to stop CFAs in libel, defamation and privacy cases.

[Mr Djanogly]

In some cases, where the balance is against, that perhaps should be the case. In Naomi Campbell’s defamation case against the Daily Mirror, she received damages of £3,500 but the total costs exceeded £1 million.

In relation to clinical negligence claims, which can of course include substantial damages in catastrophic injury cases, lawyers’ costs are about half of the total damages that are paid out. In 2009-10, for example, the NHS paid out £297 million in damages and £121 million in legal costs, over half of which were no win, no fee costs. One of the leading no win, no fee cases against a multinational company is that against Trafigura. In that case, the claimants’ legal costs were more than £100 million, but the damages recovered were only £30 million. As a result, 30,000 claimants in the Ivory Coast received damages of an average of only £1,000.

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[Chris Bryant]

One of the most important things that the House can ever afford to the citizens of this country is equal and fair access to justice. Notwithstanding the remarks of the Lord Chancellor, I believe that the Bill will make it more difficult for my constituents to have access to justice.

[Tom Brake]

Will the hon. Gentleman give way?

[Chris Bryant]

I will not, if the right hon. Gentleman does not mind.

I shall not go into the issue of legal aid, but I want to speak briefly about conditional fee agreements. The Lord Chancellor was absolutely right to say that it was a Conservative Government who introduced them, and they were right to do so. In privacy and defamation cases, the awards are for the most part very small. In privacy cases, they are universally small. No privacy case has ever involved an award of more than £60,000, yet such cases cost many hundreds of thousands of pounds to take to court. Similarly, the vast majority of awards in defamation cases come in at less than £50,000. A few get up to £100,000, and of course prominence is given in the press to the much bigger ones.

I am sure that it is not the Lord Chancellor’s intention, but the danger in the Government’s proposals is that lawyers will simply not be able to take on such cases. Yes, they might take on cases such as the Dowlers or Christopher Jefferies, because they are open and shut cases, but in the vast majority of the cases relating to phone hacking, people are already terrified of taking an action because they do not want to have to go through the whole business of having their privacy re-explored by the national newspapers and in court. Those people will have no opportunity in the future. I should tell the House that I myself have used a conditional fee agreement, and that if it were not for lawyers being prepared to act on that basis, there is no way that the whole phone hacking scandal would have been exposed.

Question put, That the Bill be now read a Third time.