CPR costs changes create dangerous situation for claimants

The QOCS rules were always intended to protect claimants. The reason why they were needed is because the government removed the ability of claimants to put in place ATE insurance which adequately protected them from adverse costs orders. This was done by removing the recoverability of ATE insurance premiums from defendants on successful conclusion of their claim. 

The result of this change, coupled with the loss of ability to recover success fees from a defendant, resulted in reducing access to justice for large swathes of the population, as such work became less attractive and less viable to those solicitors prepared to take on ‘no win, no fee’ work. Many people, particularly those who have suffered serious injury,  have little access to funds to pursue such litigation on a private paying basis. Reducing the pool of legal representatives prepared to act in these cases, where frequently harm has been caused by the State, is self-serving.

In return for watering down a claimant’s right to access to justice, the government’s response was to make claimants largely immune to any adverse costs consequences.

In making the recently announced changes to the CPR, this background seems to have been forgotten.

Post Ho v Adelekun, the defendant lobby felt the changes tipped the balance too far in favour of claimants, and rather than addressing this by case law precedent and seeking to bring a new case to further develop the case law on this point, they have instead gone directly to the government and lobbied for these new rules to be rushed through, forgetting the policy reasons underlying the foundations for the changes in the first instance.

The Supreme Court grappled with these policy reasons in Ho v Adelekun before deciding that the defendants should rightly be deprived of recovery of their costs to the extent sought. The real issue behind the well-functioning of these rules was the decision made in Cartwright. Had that been addressed there’d have been no uproar about the decision in Adelekun. The knee jerk response to undo Adelekun was wrongly directed and has now taken the balance too far the other way. Everybody could have lived with Cartwright being corrected. The Supreme Court even noted that Cartwright was the real issue. 

This is a perilously dangerous situation for claimants – they now either face massive liabilities to their solicitors or law firms will face huge additional risks in representing claimants who rightly deserve access to justice. The inherent imbalance of power underlying this situation cannot be ignored, particularly where my firm represents so many people who have been injured by state actors.

Sam Hayman is head of costs at Bolt Burdon Kemp and the lawyer involved in the Ho v Adelekun costs litigation

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