The Government today announced plans to review ‘no win, no fee’conditional fee arrangements in libel cases in England and Wales.
The Ministry of Justice said a panel of senior academics will investigate whether CFAs are ‘still operating in the best interests of giving people access to justice”.
Justice minister Bridget Prentice said there were ‘growing concerns’that that CFAs may not always offer access to justice.
‘We feel that now is the appropriate time for a comprehensive, objective and evidence based examination of the operation of no win no fee arrangements in relation to personal injury, employment and defamation/cases,’she said.
Professors Richard Moorhead of Cardiff School of Law, Paul Fenn of Nottingham Business School and Neil Rickman from the University of Surrey will look at how CFAs offer access to justice in defamation and privacy cases as well as employment and personal injury. Their report is due this Autumn.
Journalists across the industry have expressed concerns over how CFAs have been used. Lawyers taking cases on a no win, no fee basis can charge a success fee equivalent to 100 per cent on top of their normal fee. Publishers have been ordered to pay huge legal costs even in cases where the claimant’s damages are low.
Although the CFAs were intended to help ordinary people gain access to justice there is concern at their frequent use by wealthy celebrities.
Naomi Campbell, who sued Mirror Group Newspapers in 2005 for pictures of her leaving a Narcotics Anonymous meeting, won damages at the High Court of £3,500. The case saddled MGN with a bill of more than £1m in costs.
A separate MoJ consultation launched last Autumn into CFAs and defamation is expected next month. Partly based on an agreement between Times Newspapers and libel lawyers Carter Ruck, the consultation will recommend a new regime for lawyers’ success fees based on how the case is settled.
Press Gazette has been campaigning for a fairer system for news organisations faced with excessive success fees which can deter them from fighting legitmate stories in the public interest.