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In response to the recent news that the Government was considering a radical reform of the “no win, no fee” legal system in Britain, Steve Ireland from the Paul Rooney Partnership offers support for the current compensation system, and why a system based on the US would not work in Britain: “The ‘no win, no fee’ method of funding works well as there is a strict merits test, and legal aid is fully repaid if the case is successful. Frivolous compensation claims are not pursued by reputable solicitors, as the ‘no win, no fee’ system means that, if you don’t win the case, you don’t get paid. “In my experience, insurers do not pay out if the claim is frivolous. If some insurers are paying damages in frivolous claims then it is their procedures which are at fault, not the system. They should let the case go to court and become subject to judicial assessment. Judges are robust and will not award damages where the case has no merit “In John Major’s Conservative Government, Ken Clarke supported the abolition of legal aid in personal injury cases, and the introduction of ‘no win, no fee’ funding. Now, Mr Clarke believes the system he supported isn’t working, based on a misconception that we have a ‘compensation culture’, when in reality, the number of cases that have been pursued in the last few years has remained fairly static. “Insurers don’t always admit liability when they should, which extends the proceedings and leads to extra cost being incurred. It is disingenuous of insurers to argue that the blame rests solely with the lawyers. Reducing the amount of costs that have to be paid by insurers will not lead to a decrease in premiums; it is naïve to believe otherwise. It will only lead to an increase in profits for insurers. “The American model of contingency fees, where the lawyer takes their costs out of the awarded damages, works in the US because their damages are usually much higher. The proposed 10% increase in the level of damages awarded in the UK will not even get close to putting our damages levels on a par with the US. As a result, it is the claimant who will ultimately lose out as they will be undercompensated for their injuries. “Some of the blame must be shouldered by the private sector, and public Health and Safety officials. It is in their interests to fuel the misconception that there is a ‘compensation culture’ as this fear inevitably leads to more work, i.e. replacing faulty paving stones on public highways. In reality, the law provides ample protection for those organisations who adopt a common sense approach to health and safety. “If a claim is pursued, it should be defended robustly because, if it is frivolous, it will not succeed and the cost of defending the case can then be recovered from the claimant’s After the Event insurer.” The Paul Rooney Partnership are one of the UK’s leading accident claims specialists, for more information visit www.paulrooney.co.uk Ref: PRS-HS-151110
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