Casualties of Law

The abolition of legal aid and the incorporation of the Human Rights Act into English law have changed the way the legal profession deals with personal injury and clinical negligence cases, writes Fenella Quinn

The past couple of years have seen major changes in clinical negligence and personal injury. The largest, of course, is the well-charted abolition of legal aid, which is only now beginning to show its effects. And, as the the bar grapples with this change, it must also gear up for the effects of the Human Rights Act.

These changes have come about at the very time that the bar is having to completely reassess its mind-set in order to become commercially fit for the modern world.

While the abolition of legal aid for personal injury cases is a widely unpopular move, taking into account the massive success rate in these types of claim, it is starting to have an interesting effect.

"Conditional fees will mark out those who are prepared to do them sensibly – those who can manage themselves commercially and nottake silly risks," says Bill Braithwaite QC of Exchange Chambers in Liverpool.

While he points out that some firms are embracing conditional fees, providing insurance and expecting to do very well without legal aid, others fear that conditional fees bring a commercial pressure to bear on personal injury cases that can only jeopardise their results.

"Firms that do conditional fee agreements will need to find barristers who are prepared to do it – some are and some aren't," says Braithwaite. "No fees could have a big impact – if you fail on a few, then that's a lot of no fees. If you magnify that across a whole set, it will do very badly and it will have to disband. On the other hand, if you get a chambers that doesn't do them at all, solicitors won't use it, so it's a very fine line to tread."

He says that the answer for barristers lies in entering the commercial world. "Barristers need to understand that solicitors want them to take risks with them. We've got to get more involved with assessment at an early stage."

Stephen Irwin QC of Doughty Street Chambers, however, disagrees with the idea that barristers should be available on risk. "A lot of solicitors don't want barristers on risk," he says, adding that solicitors prefer to have barristers' fees covered by insurance to ensure they give independent advice. "Of course, if a barrister comes in early that's helpful because the earlier we are brought in, the more we can influence the settlement fee," he adds.

Irwin agrees, however, that it is important for solicitors to assess the risks involved when setting a success fee. Set a fee too low in a bid to attract business and you could find yourself out of pocket, he warns. Citing an example where a solicitor wins two out of every three cases, Irwin says a solicitor would need to charge a 50 per cent success fee on the two he wins in order to accommodate the costs he has borne in the losing case.

He says that failure to manage the risk factor effectively to cover losses could also raise ethical problems for cash-strapped solicitors. "If the solicitor agrees too low a fee he will be in financial trouble and he might settle cases too low in order to ensure success. There is an ethical problem there."

If the solicitor is paid in full out of the settlement fee, this leaves the client out of pocket. "That's a direct conflict between the solicitor and the client. We as barristers have to stand firm against this," states Irwin.

Under Bar Council practice guidelines, if the barrister thinks a settlement figure is too low, he or she must inform the client, tell them why the figure is too low, and, crucially, explain if there is a conflict of interest between themselves and their solicitor. If this is not adhered to, says Irwin, there will be a rash of cases where claimants sue because they have been underpaid for their claim.

A major change that everyone in both clinical negligence and personal injury is going to have to come to terms with very rapidly is the advent of the Human Rights Act. While claimants can currently sue in negligence or breach of statutory duty, after 2 October they will be able to sue for breach of the European Convention on Human Rights' articles protecting the right to life and imposing the duty on public authorities to take positive steps to ensure that lives are protected.

As every medical operation under anaesthetic involves risk of death, this will have an enormous impact, says Philip Havers QC of 1 Crown Office Row. "This may give rise to a broader approach to clinical negligence than the existing approach," he says.

Furthermore, using lack of resources as a defence may no longer protect the medical establishment. "It's certainly up for grabs once the convention is incorporated to what extent the hospital or public authority will be able to say they couldn't afford to put in place some expensive treatment or other," he says. "Until now, the courts have stayed out of this, but that safeguard will no longer be there once the act is incorporated."

When the National Health Service Litigation Authority (NHSLA) was set up nearly five years ago to defend local health authority trusts, there was concern that the extra layer of lawyers imposed would clog up the whole process. "The NHSLA are not everybody's cup of tea," says Braithwaite, who complains about the NHSLA's 'backloading' culture, whereby it leaves settlement right up until the eleventh hour. "What matters to people like me is how they run their cases, and it's still not very impressive."

The NHSLA is reorganising, however, expanding its in-house team of lawyers and, according to one barrister, attempting to depart from this unpopular modus operandi.

With so many lawyers in-house, it is no problem for the NHSLA to instruct the bar direct, unlike the defence insurers, the Medical Defence Union (MDU) and the Medical Protection Society (MPS). These bodies are now taking advantage of Bar Direct, the bar's scheme whereby qualifying bodies can obtain licences to instruct the bar direct so long as they can prove they have the necessary case handling skills internally.

According to John Mcleod of the Bar Council, Bar Direct is still at the pilot stage, but with more and more pilots being added. "It's a process of evolution rather than a big bang," he says.

Bar Direct is not currently being used where litigation is involved, according to Dr Sherry Williams of the MPS. "Our licence covers representation before the General Medical Council (GMC) and general advice for individuals and to the organisation as a whole."

Williams says MPS might instruct counsel on policy matters such as changes to GMC rules, disciplinary matters and any other matter that does not involve litigation and where the presence of a solicitor is, in essence, overkill.

Havers is set to publish his book, An Introduction to Human Rights and the Common Law, outlining the changes next month, and is keen to promote knowledge of the act. "The extent to which practitioners and local authorities are boning up on this varies. But it is now only six months away and in fact some judges are already applying it if not explicitly, then implicitly."

One idea being mooted again is to set up a no-fault system, whereby courts are abolished and the equivalent of the Criminal Injuries Compensation Board set up to dish out awards.

"But it's a fallacy. If you say let's stop proving fault and only need to prove that it's a medical act that caused the damage, to what degree is the outcome from medical intervention and what has been caused by an underlying condition?" asks Irwin. "That's often the most complex part of medical litigation – proving causation."

He predicts this system would either impose a crippling financial burden on the NHS, or mean standardised, low awards to all. "You would not be distinguishing between those who shouldn't have suffered, and those for whom it was just one of those things."

The Woolf reforms have introduced changes with varying degrees of success. One example of this which wins Irwin's backing is the fact that expert witnesses can now be ordered to meet to discuss the merits of a case according to an agenda struck up between the parties.

"It's very useful," says Irwin. "Experts talk to each other and it means that people get to the nub of it. Weaknesses in a case get exposed more often, which means fewer trials."

Likewise the introduction of the Civil Procedure Rules Part 36, whereby claimants can make offers without sanction, plus new rules to say the defendant can be forced to pay claimants' costs where the claimant refuses the offer and is awarded a similar or greater sum, means more cases settle.

But despite improvements such as these, observers say little has changed.

"Woolf was a wonderfully Utopian ideal," says Braithwaite. "But it has not really been helpful in ways one had hoped."

However, he is optimistic about the area in general. "The clinical negligence and personal injury bar is thriving," he says. "It's an ever increasing, always rewarding area of work with lots of human interest. People are suing more because they're becoming more conscious of their rights and solicitors are advertising more."