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Straw wants ten per cent cap on success fees for libel

19 January 2010

With a general election looming, justice secretary Jack Straw is planning to cut the uplift libel lawyers can add to their success fees from 100 per cent to 10 per cent of base costs.

In his review of civil litigation costs last week, Lord Justice Jackson proposed that success fees and insurance premiums should no longer be recoverable from defendants.

He recommended a 25 per cent cap on success fees as a proportion of damages, particularly in personal injury cases, but not in the area of defamation, where it was “much less of a problem” for claimants to lose a large percentage of damages so long as their reputation was vindicated (see Solicitors Journal 154/2, 19 January).

“Lawyers need to recover their costs and be rewarded for their efforts and the risks they undertake when providing people with access to justice in ‘no win no fee’ cases,” Straw said.

“But evidence suggests that the regular doubling of fees that currently takes place is simply not justified and the balance of costs between claimant and defendant needs to be reconsidered.”

Straw said he looked forward to considering the Jackson review in detail, but the case for “an urgent interim measure” for dealing with success fees in defamation cases was clear.

The MoJ is allowing four weeks for a consultation on the issue. A spokesman added that the success fee could be reduced without the need for primary legislation.

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