It has come as no great surprise that the Ministry of Justice has delayed the extension of fixed recoverable costs (FRC) to April 2023. In September 2021 the government announced their intention to inclement the extension of FRC across all fast track civil cases and to introduce intermediate cases for claims up to £100k. October 2022 has been the intended launch date. This was always felt to be optimistic with many commentators predicting 2023 as a more realistic start date. We think that this might even go back further to October 2023 bearing in mind the experience of the profession in relation to other ‘reforms’ such as those affecting whiplash cases.
The uncertainly around these changes is very damaging to law firms who are unable to plan for the future until they know the extent of the changes and when they will happen
These proposed changes do not cover clinical negligence cases which are the subject of a separate consultation that concluded in April 2022. The Ministry if Justice have said that the invention of the changes will be to – “enable claimants and defendants to achieve faster resolution of ‘lower value’ clinical negligence claims (claims valued up to and including £25,000) at a lower, more proportionate cost than under the current system” and impose “limits to the amount of legal costs that can be recovered by claimant lawyers for lower value clinical negligence claims”. The latter statement is telling bearing in mind the government’s often stated view that those who represent victims are overpaid. Anyone who has ever done this work will be aware of the huge amounts of work that are required in cases that are often contested until very ate in the day. In May 2022 Legal Futures reported that an open letter had been sent to the government urging a rethink and for certain cases to be exclude, particularly those involving vulnerable victims –
Charities and patient groups urge rethink on negligence costs plans
Signatories include AvMA, Mencap and MIND. The effect of any change will to reduce the amount of costs that can be recovered from the negligent party. In many cases victims will end up paying costs from their damages.
The consultation can be seen here –
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/1051227/Fixed-recoverable-costs-in-lower-value-clinical-negligence-claims-a-consultation.pdf
All of this has to be seen alongside reports of massive delays in the civil justice system. In some cases it is taking up to 15 months to get from Claim Form to CCMC. The average is 350 days. In an age where firms are not paid until a matter is concluded, this can have a huge impact of the viability of certain and work, or even the availability of remaining open. You don’t have to be an expert in practice management to know that the longer the wait for payment, the most expensive the work.