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Civil Litigation Section

Reform has failed. Here's how to fix the civil litigation system

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The Woolf and Jackson reforms have failed and the cost of litigation has rocketed, says David Abraham. Here, he outlines his vision for a streamlined litigation system in light of Lord Justice Jackson’s call for fixed fees to apply to all claims up to £250k.

The substance of my proposals is likely to be very contentious. Perhaps it would be more prudent to begin with three non-contentious statements.

First, access to justice is vital for the rule of law.

Second, for there to be access to justice, all people should be able to afford to conduct litigation.

Third, the current civil litigation system is too expensive, at least for cases worth up to £250,000 (the maximum level of damages for which it is proposed that fixed costs apply), despite the Woolf / Jackson reforms. Indeed, I contend that the excessive cost of civil litigation is due, in large part, to those reforms.

The problems

The reforms were based upon a false premise, that the excessive cost of the civil litigation system was due to solicitors and that if the conduct of litigation could be managed by the judiciary, litigation would be cheaper. Also, the judiciary viewed their time as more valuable than the time of litigants and their lawyers, so substantial interim process was introduced to reduce the time at trial.

However, both before and after Woolf and Jackson, trials have taken place in a minority of cases. Although there may have been a modest saving in judicial time at trials, it has increased substantially in interim process.

The senior judiciary refuse to acknowledge that the reforms have been the cause of much of the excessive cost in civil litigation, because to do so would be an admission of failure. Rather, they seek to restrict costs by either the short and summary process of budgeting and introducing the wholly arbitrary new proportionality rule, or, ultimately, by fixing costs. All three are fundamentally flawed and morally objectionable.

The senior judiciary refuse to acknowledge that the reforms have been the cause of much of the excessive cost in civil litigation – to do so would be an admission of failure

All practitioners know that budgeting has done nothing but increase costs. From the need to prepare budgets and CCMCs, to the increase in the length of bills and points of dispute in detailed assessment, and complications over the interaction between the budgeting and detailed assessment processes, there has been a substantial and obvious increase in work and costs.

In contrast, there has been no attempt to establish the extent to which costs have been reduced by budgeting.

The new test on proportionality is an admission of failure, because the court is allowed to reduce costs if it considers costs disproportionate, even if the work was necessary. I ask, rhetorically, how can it be correct that a party who succeeds in litigation should have to bear its own costs, even if the rules made the steps undertaken necessary? If access to justice is considered important, then the new proportionality test removes justice from the equation.

Fixing costs is another recognition of failure of the reforms. Again, I ask, rhetorically, why should a lawyer acting for a victim or the victim not be able to recover all costs incurred if they were incurred necessarily? Again, to deprive the victim or their lawyers of such costs is simply unjust.

The solution

Many will see my solution as unacceptable because, in many aspects, it is to turn the clock back beyond Woolf, when interim process (then known as interlocutory process) and the involvement of the judiciary in the management of cases, were minimal.

Benefits

My proposals have three benefits. First, they will reduce the cost of civil litigation. Second, they will remove the judiciary from the management of litigation and restore the judiciary to its proper and correct role in civil litigation, of adjudicating disputes. Litigation is to provide justice to litigants and belongs, therefore, to the parties. It should be for the parties to decide how they wish to conduct their litigation and not for judges to tell them. Why does a claimant, who has suffered broken limbs in an accident, need the permission of a judge to call an orthopaedic expert to support their claim?

The third benefit, flowing from the second, is that there will be a very large reduction in judicial involvement in interim procedures, which will mean a very large saving in judicial time and cost. That should be attractive to the Department of Justice, which is wrestling with the need to reduce costs.

Changing litigation

In looking at how the litigation process should be altered to achieve my aims, the first step would be to abolish pre-action protocols, which are nothing more than pre-litigation pleadings: there is no reason, in cases up to £250,000, for that process. Claimants should be required to send a letter before action, explaining the basic facts and informing the proposed defendant of an intention to commence proceedings.

CMCs and CCMCs should be abolished and replaced with standard directions, with recourse to the courts only if the parties cannot agree timetables, or they seek to change the directions and cannot agree those changes. In both situations, the court would be adjudicating on a dispute and not managing the litigation.

There has been no attempt to establish the extent to which costs have been reduced by budgeting

The industry that has developed around witness statements is outrageous. Witness statements are not the evidence of the witnesses but the clever drafting of lawyers. The exchange of witness statements should be abolished. Instead, the parties should serve a list of their witnesses, with a strictly one-page summary of the evidence to be given by each witness. The witnesses can then be called at trial and the judge can hear evidence-in-chief as well as cross-examination. It was remarked to me by a circuit judge that it is very difficult to form a view on a witness’s evidence when all one hears are the answers to cross-examination.

It will be said that such a proposal has three flaws. First, it will increase the length of trials, but as I have stated, most cases do not reach trial.

Second, we revert to trial by ambush, but if there is no property in a witness and the identity and contact details of the witness are disclosed, there need not be an ambush.

Third, if witness statements are not exchanged, it will reduce the prospect of settlement. Certainly in personal injury litigation, which makes up the vast majority of claims under £250,000, very few claims settle as a result of seeing witness statements from the opponent. Although proofs of evidence for witnesses will be produced, they are much cheaper to produce than witness statements.

In my view, parties should be allowed to call whatever experts they want to support their case. It is their litigation and it does not belong to the judiciary. Service of reports should be sequential, so that defendants know the expert evidence which has to be answered.

Parties should be allowed to call whatever experts they want to support their case. It is their litigation and it does not belong to the judiciary

After service of expert evidence, there should be no joint meetings and joint statements, which has become another very expensive industry, with lengthy and expensive agendas, joint meetings and statements. Further, joint statements are inevitably at risk of being flawed. As one expert remarked to me, the joint statement often reflects the doctor who is the more aggressive. In some instances, reports make no medical sense and, in others, the statement is so complex that no one, including the judge, understands what the experts are trying to say. Let the experts produce their reports and then let them give their evidence at trial.

Finally, we need to look at the production of chronologies, case summaries and skeleton arguments, which are expensive but often duplicated by oral submissions. If we are to have chronologies, summaries and skeletons, they should constitute the submissions of the party with no oral submissions. In the alternative, do away with them altogether; the court should make decisions based on oral submissions only.

At the end of litigation, if costs cannot be agreed, there should be rigorous detailed assessment (not summary or provisional), and only those costs incurred reasonably and necessarily and costs reasonable and necessary in amount should be allowed.

Conclusion

If implemented, my proposals would: produce a system which is far simpler and cheaper for litigants; restore justice to the equation; and facilitate access to justice for the majority who now cannot afford litigation. Also, as the costs of litigation reduce, the cost of claims to insurers and public bodies will fall too.

This is not an attack on the judiciary, who have always had the best of motives, but an acknowledgement that civil litigation has become too expensive for cases under £250,000. I say the answer does not lie in artificial and morally wrong proportionality rules or fixed costs, but in streamlining the system itself to make it less costly.

David Abraham is a cost law consultant. He sat on the committee of the ALCD to advise the MoJ on the re-formatting of bills of costs and is a regular lecturer for external conference organisers.

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