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It is now just over three years since the wide-sweeping “Jackson" reforms were implemented in relation to the conduct of personal injury and civil litigation cases.
The key objectives of the reforms, according to Lord Justice Jackson himself, were to increase access to justice, reduce costs and enhance the more efficient conduct of litigation. At the time of the implementation of the reforms those supporting the landmark changes made it clear that the success of the reforms would be judged not upon the theoretical intentions of the reforms but upon the actual outcomes which they ultimately achieved.
Of the many changes which the reforms implemented two were of particular importance:-
- Firstly, the introduction of a new budgeting process – requiring the courts to specifically consider and review cost budgets relating to all personal injury and medical negligence cases; and
- Secondly, the transfer of responsibilities for “success fees” and associated insurance costs in conditional fee (“no-win no fee”) cases away from the defendant in the case to the claimant pursuing the claim for damages.
The intention, it was said, was that these key changes would provide greater efficiency in the litigation process and would ultimately also significantly reduce the overall cost of litigation. In doing so it was claimed that a further advantage would be that the costs of insurance premiums for both road traffic and other insurances would be driven down.
The Jackson reforms represented a highly significant shift away from the fundamental principle that a person responsible for causing damage or personal injury to another should bear sole responsibility for all reasonable and proportionate costs which were incurred as part of the litigation process which followed as a result. The reforms, in effect, displaced the fundamental presumption which had existed for many centuries that a person or organisation responsible for causing serious injury or loss should also bear responsibility for all reasonable costs associated with any claim for damages which was subsequently pursued.
Three years on from the implementation of the reforms have these key objectives be achieved?
In relation to the budgeting process the almost universal recognition of anyone other than those responsible for implementing the reforms is that the reforms have fallen far short of the expectations which were set. Throughout the English and Welsh courts the approach to cost budgeting has been both inconsistent and unpredictable. Cost budgeting varies widely from region to region and from court to court. Even within the same courts, there is often enormous variation between the approaches adopted to the budgeting process by individual judges. Some judges apply a forensic approach to the analysis of a budget. Others are much more "broad-brush". A limited number of judges prefer to avoid the budgeting process altogether if it is at all possible to do so.
The result is inevitably confusion and, ironically, often far higher overall costs. The process of preparing and contesting cost budgets has become an increasingly complex and expensive additional phase in the overall progression of a personal injury case. The stated hope that the budgeting reforms would encourage parties in the majority of cases to agree budgets has proven illusory. The vast majority of personal injury litigation lawyers dealing with complex cases have few, if any, experiences of budgets being agreed. Instead, the budgeting process has in many cases become an area of increasing dispute. The inevitable result is that the progression of a case is almost always significantly delayed whilst the parties try to resolve what has become an increasingly negative and polarising aspect of the litigation process. Across England and Wales an unavoidable and worrying consequence of these difficulties has been the ever lengthening delays in dealing with the budgeting hearings, often running into months rather than weeks. Even after the budgeting process has been concluded the parties nevertheless ultimately run through very similar disputes at the stage a case is concluded – when the costs in the case are subject to further negotiation and, if unresolved, to the longstanding process of the detailed assessment of costs by the court.
In complex personal injury and medical negligence cases the process of calculating an accurate budget is often an impossibility. Trying to predict with accuracy what might happen during the course of future litigation which for seriously injured clients and their families might well might span several years, is frequently no more than a "crystal ball gazing” exercise . The inevitable result is that a party pursuing a claim for damages is forced into a situation of having to try to predict all possible eventualities and scenarios with the consequence that the cost budget itself becomes an increasingly complex and impenetrable maze of possibilities and alternative scenarios. The main beneficiaries, it would seem, are the ever increasing numbers of costs draftsman – certainly not claimant’s or their families.
The vast majority of practitioners acting on behalf of the claimants have, therefore, inevitably reached the conclusion that it is far safer to complete the majority of the work in a case long before commencing court proceedings and reaching the point of the formal budgeting process. Frontloading of costs and work in most cases is the direct consequence of a process which encourages a party claiming damages to avoid the unpredictability of the formal budgeting phase in a case for as long as possible – and altogether if possible.
Despite the many problems which exist at present time there appears to be little, if any, appetite at a senior judicial or governmental level to try to resolve the serious shortcomings which have arisen in relation to the budgeting process introduced by the Jackson reforms .In effect no one has as yet had the courage to point out that “The Emperor has no clothes”. The best which can be hoped for is that the courts and individual judges will, by a process of trial and error, eventually evolve a more rational and streamlined approach to budgeting which will in time hopefully go some way towards meeting the objectives originally intended. In the meantime continuing uncertainty, delay and additional costs are likely to be inevitable in most cases. Legal practitioners acting for injured clients must therefore continue, in the interests of their clients, to try to achieve the very best outcomes which they can whilst operating within the current less than satisfactory system.
Access to Justice
Beyond the shortcoming of the budgeting process there is currently little, if any, evidence to suggest that the second main objective of the Jackson reforms (to improve access to justice) has been successfully achieved.
From the perspective of a party responsible for causing damage and loss it may be said that one consequence of the Jackson reforms has been that the overall cost of litigation has been marginally reduced. However, what is often missed in relation to this assertion is that any reduction in overall costs payable by defendants has been achieved largely as a result of shifting part of the cost liabilities from the party responsible for causing an injury or loss to the claimant who sustained the injury or loss. In effect, a claimant who has suffered injury or loss (often through no fault of their own) must ultimately meet a large proportion of the costs for the “privilege” of having been injured. To most practitioners and members of the public, that reality falls far short of the recognised concept of "Justice".
It is an almost universal truth that those who sustain injury would rather have not sustained an injury at all and would happily forego any damages which they have received if they could be put back into the same position as they were in before their injury took place. It remains to be seen, therefore, whether the fundamental change in a centuries old presumption that a person responsible for causing loss or injury should meet the costs of any litigation which follows is acceptable to the wider public. For those who have sustained injury and loss the clear answer is that this is not “Justice”. The idea that an injured person should receive damages to compensate for the injury and loss which they have sustained but nevertheless then have to set aside some of the damages which they have recovered to meet part of the overall costs of pursuing a claim is, to most practitioners and members of the public, fundamentally unfair. Put simply, it is not “Justice”.
And what of the falling insurance premiums which were predicted to follow the reforms? The short answer is "no sign yet". Indeed the clear trend is in the opposite direction. Those who predicted falling premiums, including many close to Lord Justice Jackson himself, have been proven wrong. Instead, premiums for both road traffic insurance and other forms of insurance continue to rise unrelentingly. Arguably, the main beneficiaries are not the individuals who meet the premiums but ultimately the large organisations and international companies who receive them.
What then is the future of the Jackson reforms? It will be unrealistic to believe that the reforms will be either directly or indirectly dismantled. The best which practitioners and claimants can hope for is that, through growing experience of the reforms and the budgeting process, courts will eventually adopt a more uniform and predictable regime which will result in more consistent and fairer outcomes – for both parties. In the meantime, practitioners acting on behalf of claimants must learn to work as best they can within an imperfect process which often produces less than “Just” results. By focusing upon this task the long term hope must be that the litigation process will progressively improve. Certainly, there seems to be a clear desire on the part of many judges to try to produce a more streamlined and predictable approach to the uncertainties which the reforms have produced. Irrespective of what happens, however, claimants must expect that there will be no immediate resolution to the injustice of effectively having to pay part of the costs for the undesirable “privilege” of being injured.
Against this background it is both disappointing and surprising that the current government and Lord Justice Jackson continue to show a determination to press forward with other wide sweeping reforms – such as the hasty and ill considered implementation of fixed fees relating to often highly complex personal injury and clinical negligence cases. Once again, the likely casualty of this process will be fair “access to justice” for all. Potential claimants who have sustained injuries will inevitably find it increasingly difficult to locate an experienced legal practitioner who will both accept and pursue what would otherwise have been an entirely justifiable claim for damages. Practitioners must respond to this challenge by working out new ways of conducting litigation rather than trying to deny that these further changes will be implemented or delayed. The reality is that fixed fees will not be side-lined or delayed. If those who have sustained injury are to receive proper “Justice” practitioners, including myself and my colleagues at Novum Law, must adapt both procedures and practices to meet the challenges which fixed fees will inevitably present to the pursuit of justice in complex cases for injured claimants.
Three years on from their implementation, therefore, have the Jackson reforms successfully achieved their key objectives? The logical answer to this question must be "No". Access to Justice has not been improved. It has, in general terms, been universally made more difficult for those who have suffered injury. Certainly, it is more expensive for those who have sustained injury to pursue a case. In addition, once a case reaches a court, the litigation process has clearly not become more efficient. Delays, both in relation to cases generally and the listing of court hearings specifically, have increased as an inevitable consequence of the unwieldy and poorly defined budgeting reforms and procedures which have been implemented. Compounded by the stratospheric increases in Court Issue fees implemented by the Court Service in 2015, it is arguable that the primary victim of the reforms has, sadly, been “Justice” itself.