New research has shown that Lord Woolf's proposed £2,500 maximum on costs for the fast track is likely to be far too low for personal injury cases, backing up personal injury lawyers' claims that his proposals won't work for them.
In an analysis of 119 personal injury case files likely to have fallen within Lord Woolf's fast-track scheme, researchers from the Centre of Advanced Litigation at Nottingham Law School found that the mean costs were £4,116, which is 70 per cent more than Lord Woolf's suggested £2,500 ceiling.
Average costs, recosted in the research to reflect a £75 hourly rate, were 63 per cent of the amount that was being claimed. Woolf is proposing that clients should not have to pay more than 25 per cent of the amount being claimed.
The research, commissioned by the Association of Personal Injury Lawyers (Apil) but conducted independently, also found an enormous variation in the costs and in where and when in each case most costs occurred, indicating that Lord Woolf's and the Law Society's proposed table of sliding costs might be unrealistic.
For example, in two similar cases, one solicitor spent 24 minutes talking to his client, the other spent 14 hours.
Even worse for Woolf's reforms, it found that 81 per cent of costs in personal injury cases were for attending the client, corresponding with the other side and dealing with documentation – affidavits, pleadings and witness reports. These are all areas unlikely to be affected by Lord Woolf's plans to speed up judicial procedures.
John Peysner, principal lecturer at Nottingham Law School, who managed the research, said: “This indicates that if a fixed fee of £2,500 is stuck to, either personal injury solicitors will not be able to recover all their costs, or they will have to charge their clients more or, in the worst scenario, they will have to skimp work.”
He added: “I think fixed and proportionate costs are necessary, but the level at which they should be set needs further discussion. There are so far only two pieces of research on this issue and more is required.”
Lord Woolf commissioned Professor Hazel Genn of University College London to study taxed costs in the High Court, but her study did not look specifically at low value personal injury cases.
Apil vice-president Ian Walker said: “This confirms what most personal injury lawyers already know. It's a great pity Lord Woolf didn't commission this sort of report himself. Fixed costs in personal injury cases are just not fair on the plaintiff.”
In another boost to personal injury lawyers, Lord Irvine of Lairg, Labour's shadow Lord Chancellor, hinted at last month's Bar Council conference that he might be prepared to exempt personal injury lawyers from Lord Woolf's fixed-cost fast track.
“This is a subject on which, if it were to become my responsibility, I would be willing to receive representations and to consult,” he said.