Judge warns against 'piecemeal' reform of libel costs

A senior judge leading a government-backed review into legal costs has warned against “piecemeal” reform of the no-win no-fee system in libel trials.

Lord Justice Jackson told parliament this morning that although he recognised the problems associated with conditional fee agreements, a broader reform of litigation costs should be carried out instead of bowing to “vocal” media critics.

Jackson was commissioned last December to head a year-long review of legal costs in civil cases. His final recommendations on how to improve access to justice are expected in the autumn.

Giving evidence to the culture, media and sport select committee today, he told MPs: “There are serious issues about the costs of defamation proceedings and the whole of civil litigation.”

But he added: “We must deal with this problem in principle and across the board and not embark on piecemeal reform for one tiny part of the civil litigation terrain which may perhaps have a slightly more vocal representation than others.”

Journalists from across the industry have expressed concerns about the conditional fee agreement system used in some libel trials. Although CFAs were intended to help ordinary people gain access to justice there is concern at their frequent use by wealthy celebrities.

Claimants pay nothing up front but lawyers taking cases on a no-win, no-fee basis can double their money if they win, leading to huge bills for the losing party.

One proposal is for lawyers’ fees to be capped, but Jackson told the select committee today that he had doubts this would work.

An alternative option he is looking at would involve both sides in a libel trial submitting details of their budget to the court before proceedings begin.

“I’ve had some intensive meetings developing the proposals,” he told MPs.

“Whether this will be a feasible way forward I do not know at this moment but it may be another approach to achieve what is sought by cost-capping.”

He also appeared to reject the idea of means testing for libel claimants, that would restrict the CFA system exclusively to people who cannot afford to pay their own costs upfront.

“I myself see considerable difficulty in devising a set of rules the effect of which would be only persons who satisfy a particular means test are entitled to instruct their lawyers under a conditional fee agreement,” Jackson told the committee.

“While I’m conscious of the problems conditional fee agreements generate, at the moment I’m very doubtful that means testing would be the way to crack the problem.”

Lord Jackson also suggested that “no-win no-fee” acted as a filter preventing some of the more frivolous libel claims being taken up.

“I agree that there is an economic incentive [for lawyers] to pick cases they think are going to win,” he said.

“That incentive is very important for defendants because frivolous cases are less likely to be pursued.

“A filter is created which generally weeds out weak and frivolous cases.”

Asked by the committee if he was concerned by claims made by newspapers that claimant lawyers deliberately prolonged proceedings to inflate costs, he replied: “I have not seen any evidence.”

Master of the rolls Sir Anthony Clarke, who also appeared on today’s panel, said while it was the case 10 years ago that libel proceedings would be dragged out by “endless technical points”, he believed the profession had cleaned up its act.

“It is certainly something that judges should look out for,” Clarke told MPs. “It is obviously very unsatisfactory for any party to deliberately string it out in order to make money.”

The media select committee began its investigation into the legal issues facing the press earlier this year. It has so far heard from Max Mosley, Gerry McCann, Sir Christopher Meyer, media lawyers and editors including Colin Myler, Alan Rusbridger and Paul Dacre.

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