Success fees set to soar

Lawyers can expect a massive hike in success fees as a result of government plans to include them in the costs paid by losing defendants, according to leading personal injury lawyer Martyn Day.

Speaking at the first Institute of Barristers' Clerks conference, held on 18 July, Day predicted the reform, which seems likely to be adopted by the Government, will lead to success fees of 100 per cent becoming standard practice.

Although a supporter of the proposals, the senior partner of top London personal injury firm Leigh Day & Co warned their immediate impact would be dramatic.

He said the Law Society's current voluntary cap on the uplift charged by solicitors, which amounts to no more than 25 per cent of total damages, would “just disappear”. “Lawyers will just take whatever they can get,” he said.

Day said massive costs would have to be reduced on taxation and after a transitional period taxing masters would establish clearer guidelines for what lawyers could feasibly charge.

Anthony Cherry, a partner at Beachcroft Stanleys and a member of the Forum of Insurance Lawyers (Foil), which opposes the proposal, agreed with Day but said the cost and time involved with taking costs to taxation when compared to the sums involved meant many claims might go unchallenged.

He said Foil was discussing a scheme with the Government based on the Woolf proposals, whereby plaintiffs in conditional fee cases would be required to make an offer for settlement into court. If the final damages exceeded this figure the defendants would pay the success fee, otherwise the plaintiffs would have to fund the lawyer's uplift themselves.