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No-win-no-fee arrangements should be scrapped

  • Conditional fee arrangements have corrupted the legal profession and permitted a vast increase in lawyer-driven litigation
  • Increasing ‘access to justice’ has been used as a smokescreen to allow the exploitation of private disputes for financial gain

No-win-no-fee agreements have had a corrupting effect on the legal profession and should be scrapped, Civitas Director David Green argues in a new publication.

Conditional fee agreements (CFAs) and contingency fees – where lawyers take a share of the civil damages – should be cancelled to reduce the number of cases which are pursued purely for financial gain, he says.

The proposal is contained in a book, to be published next week, analysing the evolution of the judicial system in recent decades. In Democratic Civilisation or Judicial Supremacy?, Dr Green shows how no-win-no-fee payments and human rights legislation have transformed the legal profession.

‘Together, they have had a corrupting effect on the legal profession and have promoted the politicisation of the judiciary,’ he writes.

‘For most of our history conditional fees were illegal under common law and the strongest opponents were the lawyers themselves. Now that we have had CFAs for some years we can see that the fears of earlier generations were understandable.’

Conditional fee arrangements have historically been opposed as illegal under the common law crimes of maintenance and champerty: mainten­ance was the name for funding or supporting litigation by another person and champerty was taking a share in the spoils of victory.

These laws still have some legal force but have been progressively weakened since 1967. Conditional fee agreements were made legal by the Courts and Legal Services Act 1990 and implemented from 1995.

Lawyers who won a case were allowed to increase their fees by a percentage of their normal fees, but initially such ‘success fees’ could not be recovered from the losing side. However, from April 2000 the practice was permitted.

Dr Green writes: ‘The longstanding fears of judges who had enforced the laws of champerty and maintenance were disregarded. The smokescreen of increasing ‘access to justice’ for the least well-off members of society has proved to be a very effective device for opening up vast new opportunities for money making by exploiting private disputes.

‘For many years to be free was to be able to go about your life, without ever having to speak to a lawyer or go near a court from one year to the next. If you obeyed the law, costly encounters with lawyers and courts could easily be avoided.

‘It is now widely accepted that these relaxations of the law have permitted a vast increase in lawyer-driven litigation.’

Dr Green urges lawyers with a sense of vocation to reassert themselves and reclaim the profession from those who have been lured by the prospects for financial gain offered by no-win-no-fee arrangements and the Human Rights Act.

‘Until very recently the Law Society and the Bar Council were stalwart opponents of contingency fees, but recently they have been captured by less scrupulous members of the profession.

‘The legal profession has become less a vocation guided by a code of ethics and more a business which looks upon particular statutes as opportunities for financial gain. The time has come for lawyers with a sense of vocation to reassert themselves.

‘Lawyers have traditionally had an obligation to the court as well as to their client. They are not supposed to be the mere hired guns of one side in a dispute, prepared to pull every stroke in the book to win.

‘They have a duty to seek the truth, which they should put above the narrow interests of their clients or their own interests in making money. But the opportunities offered by the Human Rights Act have proved too much for some.’

Notes

Democratic Civilisation or Judicial Supremacy? A discussion of parliamentary sovereignty and the reform of human rights laws  by David G. Green will be published next Friday, March 11th by Civitas: Institute for the Study of Civil Society.

Read an extract of the report, Democratic Civilisation or Judicial Supremacy? A discussion of parliamentary sovereignty and the reform of human rights laws  here.

David G. Green is the Director of Civitas. His books include The New Right: The Counter Revolution in Political, Economic and Social Thought, Wheatsheaf, 1987; Reinventing Civil Society, IEA, 1993; Community Without Politics: A Market Approach to Welfare Reform, IEA, 1996; Benefit Dependency: How Welfare Under­mines Independence, IEA, 1999; We’re (Nearly) All Victims Now, Civitas, 2006; Individualists Who Co-operate, Civitas, 2009; Prosperity with Principles: some policies for economic growth, Civitas, 2011; What Have We Done? The surrender of our democracy to the EU, Civitas, 2013; and The Demise of the Free State, Civitas, 2014.

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