Monday, 25 February 2013

The New CFA Regime and Conflicts of Interest

The new CFA regime is nearly upon us. It will present many challenges to lawyers practising in the field of clinical negligence and personal injury. I want to illustrate some particular difficulties which may cause tensions between lawyers and their clients. In the examples that follow, assume that lawyers have a CFA with the claimant under which the uplift payable by the claimant to his lawyers is for 25% of general damages for PSLA and past losses and expenses.

Problem 1: Global Settlements

The claim is for general damages for PSLA at £75,000, past losses and expenses of £125,000, future loss of earnings at £400,000 and future care and assistance at £400,000. Liability is in dispute. The defendant also alleges that the claim for future earnings is wholly speculative and disputes that claim in full. The defendant offers £200,000 which the claimant accepts. What is the CFA uplift? How does the claimant know what he is liable to pay his lawyers?

- Surely the lawyers could not seek 25% of the £200,000 claimed for PSLA and past losses (£50,000)? The global settlement means that those claims have not been met in full.

- On the other hand  it would be naive to say that since the settlement is for 20% of the total damages claimed, the uplift should attach to 20% of the sums claimed for general damages and past losses (uplift = £10,000). The weakest claim was for future earnings. Who knows how the defendant calculated the settlement value of the claim? It may have been on the basis of a 50% chance of the Claimant recovering £200,000 for PSLA and past losses and £200,000 for future losses.

It seems to me that the claimant and his lawyers will have to agree the uplift prior to settlement of the claim, otherwise the claimant will not know what he is settling for. But their interests conflict. Does the claimant need separate representation in relation to the issue of the uplift. Does he need two sets of lawyers? How does he pay for the second set of lawyers?

Global settlements of this kind are in my experience the most common type of settlement in clinical negligence claims where liability has not been admitted.

Problem 2: Interim Payments

The claimant is a 70 year old who has paraplegia due to the admitted negligence of the defendant. He requires new accommodation, equipment and 24 hour care. An interim payment is obtained to allow him to purchase, adapt and equip a house (his current accommodation being wholly unsuitable for a wheelchair user requiring full time care) and to pay for professional care prior to trial. At trial he is awarded:
£175,000 for PSLA
£200,000 for past care and case management (£50,000 for gratuitous care and £150,000 for professional care and case management)
£50,000 for equipment already purchased
£150,000 for adaptations carried out to the house
£50,000 for future equipment
£125,000 for Roberts-v-Johnstone calculation and future increased costs of housing
Future care and case management are to be paid for through a PPO.

So the total lump sum is £750,000

Of that £575,000 is for PSLA and past losses and expenses. The CFA uplift is £143,750, leaving the claimant with £606,250 out of his £750,000.

The interim payment was for £600,000 which was used to purchase a house costing £250,000, adapt it (£150,000), buy equipment (£50,000) and pay for care and case management for prior to trial (£150,000).

Thus the net lump sum payment is £150,000 of which the claimant has to give all but £6,250 to his lawyers. He will have PPOs for his future care and case management but virtually nothing else left to live on, pay for future equipment, pay for the increased costs of his adapted home etc. He also "owes" his family £50,000 for past gratuitous care.

The CFA uplift leaves the claimant unable to afford to live in the house which his interim payment was used to purchase.

Very careful consideration will have to be given to using interim payments in large claims in the future where there are substantial uplift liabilities for the claimant. Again, there will be significant potential conflicts of interest between lawyer and client.

Problem 3: Delay in resolving the claim

The longer it takes to resolve a claim the greater the amount of past losses and the smaller the amount of future losses. Hence, delay increases the uplift and rewards the lawyers at the expense of their client. In the previous example, had the claim resolved in full at the time of the interim payment then £150,000 on adaptations, £50,000 for equipment and £150,000 for professional care and case management would all have been future claims and thus not subject to the 25% lawyers' uplift. The lawyers gained £87,500 by so managing the case that resolution occurred after these costs had been incurred. It would usually be regarded as good practice to secure a large interim payment in such a case but will claimants begin to suspect that their lawyers are dragging out cases for their own benefit?

One solution would be not to seek any uplift from damages. But can lawyers afford to take on a basket of cases which will include winners and losers, without any uplift from the winning cases?

Where an uplift is agreed, it might be preferable to agree a fixed amount of money as the uplift (subject to the amount not exceeding the legal cap on uplifts). This could prevent some but not all of the conflicts of interests and difficulties highlighted above.

Perhaps a graded uplift could be agreed - the uplift increasing as total damages increase, but subject to the legal cap?

Wednesday, 20 February 2013

QOWCS and Clinical Negligence

Does QOWCS apply to all clinical negligence claims?

Leafing through the civil procedure rules amendments my eyes rested on the Qualified One Way Costs Shifting section. By s46 LAPSO Claimants on post 1.4.13 funding agreements can no longer recover premiums for costs insurance from a losing defendant (save for insurance in respect of some investigations in clinical negligence cases). The balancing provision for that change is QOWCS - a successful defendant in certain cases can only recover costs from the claimant up to the level of any damages recovered by that claimant. So the claimant who loses the entirety of his or her claim will not be liable in costs to the defendant.

The new rules make it clear to which cases QOWCS applies:

Qualified one-way costs shifting: scope and interpretation
44.13.—(1) This Section applies to proceedings which include a claim for damages—
(a)   for personal injuries;
(b)   under the Fatal Accidents Act 1976; or
(c)   which arises out of death or personal injury and survives for the benefit of an estate by virtue of section 1(1) of the Law Reform (Miscellaneous Provisions) Act 1934
but does not apply to applications pursuant to section 33 of the Senior Courts Act 1981 or section 52 of the County Courts Act 1984 (applications for pre-action disclosure), or where rule 44.17 applies.
(2) In this Section, “claimant” means a person bringing a claim to which this Section applies or an estate on behalf of which such a claim is brought, and includes a person making a counterclaim or an additional claim.

What is a claim for personal injury?

CPR 2.1 provides that  in the CPR a "claim for personal injuries" means "proceedings in which there is a claim for damages in respect of personal injuries to the claimant or any other person or in respect of a person's death and "personal injuries" includes any disease and any impairment of a person's physical or mental condition."

Clearly QOWCS applies to all clinical negligence claims which concern injury or death attributable to the defendant's negligence acts or omissions.

Also, a Human Rights Act claim for damages for non-pecuniary loss by bereaved relatives arising from a contravention of article 2 of the European Convention on Human Rights, should be regarded as bringing a claim for personal injury, because it is a claim for damages in respect of a person's death.

But a claim for damages which is purely for breach of article 8 or article 5 would, without more, not be a claim for which QOWCS applies. Claimants beware.

Claims for declarations, for example in relation to end of life treatment or do not resuscitate orders are not included.

What about a so-called "wrongful birth" claims? Are they claims for damages for personal injuries? The mother's claim might obviously "include" a claim for damages for injury by reason of the fact that she had to carry and deliver the baby. What about the father's claim?

Under s. 11(1) Limitation Act 1980 a three year limitation period is applied, "to any action for damages for negligence .... where the damages claimed by the plaintiff for the negligence ... consist of or include damages in respect of personal injuries to the plaintiff or any other person."

 S11(1) Limitation Act has been the subject of appellate judgment. In Walkin-v-South Manchester HA [1995] 1WLR 1543 the Court of Appeal held that in a wrongful birth claim "claims ... for pre-natal pain and suffering and post-natal economic costs arise out of the same cause of action." The Court held that the negligence causing the unwanted pregnancy gave rise to a claim for damages including the costs of rearing the child. The claim was "caused by the personal injury, namely the unwanted pregnancy". Thus the claim had to be brought within three years, being a claim for damages in respect of personal injuries.

Walkin preceded the wrongful birth decision in McFarlane-v-Tayside Health Board [2000] 2AC 59  in which the House of Lords considered the nature of wrongful birth claims and held that the claims for child rearing costs constituted claims for economic loss. It appears that in Parkinson-v-St James and Seacroft University Hospital NHS Trust  [2001] EWCA Civ 530 [2002] QB 266, the parties accepted that the action was not for damages in respect of personal injury but in respect of pure economic loss. Thus, the court was not called upon to determine the point.

However, in Godfrey-v-Gloucestershire Royal Infirmary NHS Trust [2003] EWHC (QB) 549 Mr Justice Leveson, as he then was, was asked to determine whether, following McFarlane and Parkinson, Walkin was still binding upon him. He held that it was. In his judgment the entirety of the wrongful birth claim, including the economic loss claims, was in respect of personal injury and thus covered by section 11 of the Limitation Act 1980.

In any event if the father's claim is brought with the mother's claim then his claim is a claim for personal injuries within the meaning of CPR 2.1 because it is a claim for damages for personal injuries to "any other person". Sometimes, however, the father's claim might be brought alone.

It would appear therefore that a wrongful birth claims include claims for personal injuries and that the QWOCS provisions apply. However, the point might be argued by the NHSLA. In FP-v-Taunton & Somerset NHS Trust [2011] EWHC 3380 (QB) the court had to consider an interim payment application in a wrongful birth claim. Whilst the court proceeded on the basis that the trial judge might make a PPO for a wrongful birth claim (available only in respect of claims for damages in respect of personal injuries) the Defendant made it clear that it would be arguing strongly at trial that a PPO could not be made for a wrongful birth claim, i.e. that wrongful birth claims were not claims in respect of personal injuries.

It will be important to know at the outset of any claim whether QOWCS applies or not. It would be reassuring for claimants to know that the NHSLA or other clinical negligence defence organisations will not take the point that it does not apply to wrongful birth claims.

Friday, 15 February 2013

What Are Barristers For?

No system of justice worth its name - be it criminal or civil - should prevent the rigorous scrutiny of evidence. Barristers who are wholly independent of the state and of any vested interest are an essential part of the administration of justice. It would be harmful to justice if, for fear of public opprobrium, barristers drew back from asking difficult, embarrassing, even hurtful questions.  

It seems necessary to give that defence of my profession because a fellow barrister from Manchester has found herself at the centre of a storm of protest as a result of what the trial judge called a perfectly proper cross-examination of a witness at a criminal trial. Tragically the witness, Frances Andrade, committed suicide some days after giving evidence. She had alleged that as a teenager she had been raped and indecently assaulted by a teacher and his then wife. The defendants were acquitted of rape but found guilty of some of the charges of indecent assault.  Much public criticism and even personal abuse has been heaped on the barrister. It is no exaggeration to say that on Twitter the barrister seems to have received more adverse comment than the convicted defendants.

Every decent person will have huge sympathy for Mrs Andrade's family and friends. The case also raises serious concerns about the support which vulnerable witnesses should be given. Nevertheless the nature and the extent of the criticism levelled at the barrister is a challenge to all barristers, even those of us who work in the less newsworthy world of clinical negligence and personal injury law. All of us, at times, will have had to put to a witness that they were not telling the truth. It would be harmful to the administration of justice if we were cowed into not doing so.

I know Kate Blackwell QC, the barrister concerned, though not well - we were appointed QCs at the same time in 2012. So this blog might be said to be partial. She does not need me to defend her, but I do want to defend the profession.

Barristers exist to represent clients - whether the client is the state, a company or an individual. They advise clients, usually at times of stress for them, and help them reach decisions about their cases. Barristers do have responsibilities to others as well but their core role is to act in the best interests of their clients. They must do so with integrity but fearlessly.

Parties to court proceedings are, usually, too personally involved, too stressed and ill-equipped effectively to represent themselves. Barristers do the speaking for them. We do not make up the evidence but we do test it. The questions we put are not indicative of our own, private beliefs. We cannot pick and choose whom we represent. We do not decide whether they are innocent, guilty, truthful or dishonest. We are not the judge or jury. We play a part as advocates in a highly developed and continually evolving system of justice.

If lawyers were to undertake no causes till they were sure they were just, a man might be precluded altogether from a trial of his claim, though, were it judicially examined, it might be found a very just claim.

SAMUEL JOHNSON, Journal of a Tour of the Hebrides, Aug. 15, 1773

Judges are well aware of the need to protect vulnerable witnesses from oppressive cross-examination. The jury would hardly be impressed by bullying questioning. Barristers have a professional code of conduct with which they must comply. But within these proper restraints, they must act in their client's best interests. It would be a poorer system of justice if they did not do so.

Everyone is one false allegation away from being at a jury's mercy. Imagine you were accused of an offence from decades ago and that you believed your accuser was giving false evidence in court. It is their word against yours. What kind of justice would be served by your barrister refusing or failing to challenge that witness's evidence in the most effective way she can?

By all means criticise the way the system deals with vulnerable witnesses (an issue which I know the judiciary takes very  seriously). By all means harangue those barristers who break the rules and those judges who allow questioning to go too far. I would not claim for a moment that all barristers are saints! But personal criticism of a barrister properly carrying out her role as an advocate is, I believe, wholly misplaced.

Friday, 8 February 2013

Claiming the Costs of a Future Inquest

Rachel Galloway, also from Kings Chambers,  and I have recently settled a fatal clinical negligence case where, unusually,  we claimed and recovered the costs of representation at a future Coroner's Inquest.
Andrea Green, aged 39, was a patient at Barnsley Hospital. She had been admitted for a routine discectomy operation. The surgeon carried out the procedure at the wrong level of her spine and then cut the iliac artery resulting in internal bleeding.  She died within 24 hours of the surgery.

We alleged that due to systemic failings the Trust had failed to comply with article 2 of the European Convention on Human Rights. A claim for damages was brought under the Human Rights Act for non-pecuniary losses, there being no family member entitled to a bereavement award under the Fatal Accidents Act. The deceased did have an elderly father and there was a dependency of small monetary value. By s 7 of the Human Rights Act there is a one year limitation period and the defendant would not agree to extend time for issue and service. So, we found ourselves commencing proceedings before the full Inquest had taken place.
The Defendant made admissions of negligence in its defence, including an admission that it had been negligent to have failed to prevent the particular surgeon from performing spinal surgery before the date of the fatal procedure, and made early offers to settle which were ultimately accepted.
What makes the case of wider interest is that as well as claiming damages for non-pecuniary loss suffered by the bereaved relatives, we also claimed for pecuniary damages, being the costs of legal representation at the future inquest. As part of the settlement the Defendant agreed to pay not only damages and costs to date, but also a substantial sum in respect of representation at the future Inquest, albeit not by way of  damages and without any admission of breach of article 2.
Whilst it is established law that the costs of an inquest already incurred may be recovered as costs incidental to civil proceedings (see the High Court decision of Roach v Home Office [2009]EWHC 312 and the earlier Supreme Costs Office decision in King v Milton Keynes General NHS Trust [2004] Inquest LR 72) there is no established precedent dealing with the situation where the costs of the inquest are to be incurred at a future date.  Indeed, due to the strictures of Part 36 of the Civil Procedure Rules, the recovery of such future costs is a real problem for families who are far too often faced with attending inquest proceedings without representation, resulting in a clear inequality of arms particularly in the medical context.  In this instance, for example, two doctors involved in the deceased’s care and the Trust will each benefit from separate representation at the inquest. 

Under the Human Rights Act the courts are given a wide discretion to award damages where it is necessary to afford just satisfaction. It is established following R(Greenfield)-v-Secretary of State for the Home Department [2005] UKHL 14 that the courts should look to the jurisprudence from Europe when determining whether to award damages under the HRA, and the quantum of those damages.

It is clear from Europe that pecuniary as well as non-pecuniary losses can be made the subject of damages and sometimes damages for pecuniary loss may be substantial - see for example Oneryildiz-v-Turkey (App 48939/99) where various heads of pecuniary loss were compensated.
In Bubbins-v-UK (App no. 50196/99) , the applicants claimed damages for the cost of an Inquest. Their application was refused on the grounds that the Court had found a breach of Article 13 (failure by the state to provide a remedy) rather than a breach of article 2. Therefore the breach had not caused the need to incur Inquest costs. However the ECtHR did not say that damages could not be awarded for Inquest costs where they followed from a breach of article 2.

There is no automatic right to public funding for Inquests and public funding for representation at Inquests involving healthcare provision, even when article 2 might be engaged, is given only in very exceptional cases. An additional barrier to public funding, in some cases, will be that the family has recovered some money from the civil proceedings. The one year limitation period under the HRA may force families to make and then resolve claims prior to Inquests taking place. Those Inquests can be complex and difficult for families fully to participate in without proper representation.

If families such as my clients have no funds to pay for proper representation at a future Inquest, then they might be able to mount a challenge relying on the investigatory limb of article 2 - see Jordan-v-UK (App no.   24746/94) and R(Khan)-v-Sec of State for Health [2003] EWCA 1129. But the better solution, surely, is for the state, through the defendant public authority to volunteer to pay for representation at the future Inquest. To its credit that is what the Trust agreed to do in our case. By so doing the public authorities have ensured that the family can fully participate in the important and lengthy Inquest which is due to be held later in 2013.

My instructing solicitor was Andrew Harrison of Raleys solicitors. The family have given permission for me to write about their case. The inquest will be heard at the Sheffield Coroners’ Court in November 2013 and is listed for 3 weeks.