Fixed recoverable costs in clinical negligence claims - another dead end?

Dominic Fairclough, Partner in the Russell-Cooke Solicitors, personal injury and medical negligence team.
Dominic Fairclough
4 min Read

We have been here before

Ben Gummer, then Parliamentary Under-Secretary to the Department of Health announced in January 2016 that fixed recoverable costs (FRC) in respect of clinical negligence claims up to a value of £25,000 would be coming into force on 1 October 2016 following a consultation.

This proposal was not implemented.

Another Government consultation took place between 30 January 2017 and 2 May 2017.

The policy was not developed following a change of government.

The most recent consultation has just concluded after running from 31 January 2022 to 24 April 2022, again seeking to introduce FRC for clinical negligence claims up to £25,000.

There have been the usual articles written in various newspapers lauding the idea of FRC on the basis that there will be an enormous saving for the NHS in terms of reducing the amount of claimants’ legal costs.

The Government pursued the line that claimants’ legal costs were spiralling out of control but then had to row back and accept that in actual fact such costs had been reducing in the last two years as had the number of claims issued in court.

There has been very little heard about how the process will work, with many questions still unanswered:

  • what will the FRC be
  • and will after-the-event (ATE) insurance premiums remain recoverable from the defendant?

It is very likely that a significant number of specialist clinical negligence firms will opt out of running cases subject to FRC on the basis that it may well be completely uneconomic.

Lawyers complaining about their costs reducing is quite rightly not something that the general public concerns itself with and there is no doubt that there are some instances where claimants’ legal costs have been too high.

Losing the screening system could lead to increase in spurious claims

It is however, broadly accepted that clinical negligence cases are often complex and require a relatively considerable amount of ‘frontloading’ before a lawyer can advise a client that the case has reasonable prospects of success. Put simply, in the vast majority of cases you need expert input to consider whether there has been clinical negligence. You would rarely need such input at the outset of a personal injury case.

An area that I believe has largely been overlooked relates to the screening process that all experienced clinical negligence firms carry out before deciding to take a case on under a conditional fee agreement (CFA).

A sensible estimate would be that of all the new enquiries seen by a firm specialising in this area over a year, you would expect approximately 10% of the cases to be taken on.

This is a vital sifting process which is carried out by specialist lawyers and generally at no cost. If firms decided to opt out then this largely pro bono service will disappear. The result is likely to mean far more spurious cases are taken on by non-specialist firms as well as there being a considerable rise in litigants in person trying to take their cases to court without the expertise to do so.

We do not know if some types of cases will be taken out of the process. At the moment, the arbitrary figure of £25,000 will capture within it many tragic fatal cases and I would find this unconscionable.

The recent scandals relating to Shrewsbury and Telford hospital NHS trust involving both maternity and adult services have made very grim reading within the press. The fact is that many of the potential claimants would fall within the £25,000 limit - particularly those relating to stillbirths.

My view is that the vast majority of us would not begrudge claimants taking matters further legally and seeking redress and some form of accountability. If FRC comes into play and specialist firms have opted out those claimants would potentially be left to become litigants in person or end up with an inexperienced lawyer.

The result will be that claimants will suffer, the courts will suffer, and ultimately there may well be little in the way of cost saving without the screening process.

A real lose-lose-lose situation

You get an inkling that something may not be a good idea when you have a senior Conservative MP, Sir Bob Neil, Chair of the Justice Select Committee, opining that, whilst accepting the idea of fixed costs in principle (as do I if FRC were at an acceptable level with an inbuilt annual review), the current proposals may not work.

Sir Bob recently stated that "you can’t always do these claims on the cheap. Of course we want to keep down needless costs, but that doesn’t mean people who have suffered from negligent practice lose their right to claim. If we make it harder for them then I don’t think we are serving the interests of justice"

Of course claimants’ lawyers need to do their best to keep costs down by making early offers and by focusing on what can be done to reach settlement as quickly as possible. I would suggest that there needs to be some focus on how NHS Resolution operates when defending claims, and in particular how quickly it comes to the negotiating table when they know a claim is likely to succeed.

The Government and NHS Resolution need to learn from the whole history of clinical negligence claims that they have at their disposal and try their best to feed back to the relevant NHS trusts and stop the recurrence of incidents of poor care that ultimately result in settlements.

The potential removal of access to legal expertise in cases worth up to £25,000 would, in my view lead to less NHS accountability, and will certainly not help us move towards preventing further scandals within the NHS. These are happening far too often. 

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