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28 August 2018

Fixed costs plans for Clinical Negligence – Is there an unfair advantage to be gained?

Posted by: Nick Mercer

At present, the landscape is ever changing when it comes to the costs of litigation. One of the steady sights however is that fixed costs seems to be on the horizon, and getting ever closer.What strikes me as perplexing with the planned introduction of fixed costs in Clinical Negligence cases, is how the Department of Health, i.e the Defendant in the majority of these cases, is able to set the level of costs that are able to be recovered by the Claimant/Receiving Party. Surely this cannot be right or proper?Regularly dealing for Claimant firms with matters where the NHSLA act on behalf of the Health Authorities, I am often surprised to see how the litigation can be unnecessarily drawn out by a stubborn Defendant. What is somewhat worrying is the potentially unfair advantage that could be gained by the Defendant Health Authorities from the planned implementation of fixed costs – especially when consideration is given to the notion that each party should be on level footing. In essence, a situation could arise whereby the Defendant Health Authorities are able to set themselves a maximum background liability, in which the longer the case goes on, the more risk the Claimant would be exposed to when it comes down to the true cost of the litigation.In any event, I am sure Mr Hunt’s comments will not be welcomed by a large number of law firms who act genuinely against a somewhat steel door Defendant. However some solace can be taken in that the fixed costs are planned to only effect Clinical Negligence cases up to £25,000.00, a marked downward reduction from the originally speculated implementation of fixed costs on cases with a value of not more than £250,000.00.

Health Secretary Jeremy Hunt today finally announced the details of the fixed costs regime for clinical negligence cases. After consulting in summer 2015 on the principle of fixed costs, the Department of Health said the scheme will be mandatory for all claims worth up to £25,000, to save the NHS in England £45m a year by 2020/21. Hunt said: "Unfortunately, what we often see in lower cost claims is a deeply unfair system where unscrupulous law firms cream off excessive legal costs that dwarf the actual damages recovered. We believe this creates an adversarial culture of litigation, which is inflating insurance premiums and drawing away resource from the NHS at a crucial time.’
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Nick Mercer

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