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Straw forced to scrap libel conditional fee cut

13 April 2010

Justice secretary Jack Straw’s plan to cut the maximum success fees charged by libel lawyers in conditional fee cases from 100 to ten per cent of damages has been dropped by the government.

Given the pressure of legislation in last week’s ‘wash-up’ before Parliament was dissolved, the government ran out of time to force through the statutory instrument implementing the change.

A spokeswoman for the Ministry of Justice said simply that Harriet Harman, the leader of the House of Commons, had “announced that the motion on the order paper is not being brought forward”.

MPs of all parties on the Commons delegated legislation committee voted against the measure last week (see Solicitors Journal 154/13, 6 April 2010).

Labour MP Tom Watson led the revolt on the Labour-dominated committee, arguing that, without conditional fees, the courts would become the preserve of the rich and powerful. He was joined by shadow justice minister Henry Bellingham, who was concerned by the size of the cut, and Liberal Democrat justice minister David Howarth, who questioned whether the measure should apply to both privacy and libel actions.

The House of Lords had earlier backed the measure, despite strong opposition from Lords Woolf and Scott.

Lawyers for Media Standards, a new association of mainly claimant libel lawyers, threatened the MoJ with a judicial review over the issue, on the basis that the four-week consultation exercise was inadequate and unfair.

Jeremy Clarke-Williams, partner at Russell Jones & Walker and founder member of LMS, welcomed the decision not to press ahead with the success fee cut.

“They were trying to force this through with undue haste and without proper thought or time,” he said.

“The fact they were doing their best to steamroller it through made people sceptical about their motives.”

Clarke-Williams said that, since the measure had “dropped from the wash-up rack”, the judicial review was now “off the agenda”.

However, he said Lawyers for Media Standards was not a single issue association and would continue.

In a separate development, Lord Neuberger, the Master of the Rolls, has set up a committee to examine the use by the courts of media injunctions.

The committee will consider the question of ‘super injunctions’, which prevent not only the reporting of a story but the existence of the injunction.

The Guardian claimed in October last year that it was prevented from publishing the text of a parliamentary question because of an injunction obtained by Carter-Ruck on behalf of oil-trading firm Trafigura (see Solicitors Journal 153/39, 20 October 2009).

A report by the Commons culture, media and sport committee on privacy and libel, published in February, expressed concerns about the use of injunctions by the courts.

Lord Justice Moore-Bick and Mr Justice Tugendhat will sit on the committee, alongside libel silk and former chairman of the Bar Council Desmond Browne QC.

They will be joined by Alasdair Pepper, partner at Carter-Ruck, and Rod Christie-Miller, partner at Schillings. Guardian News and Media will be represented by director of editorial legal services Gill Phillips and Trinity Mirror by group legal director Marcus Partington. The committee will meet for the first time on 4 May.

Rod Dadak, media partner at Lewis Silkin, said he did not think the committee was necessary. “These things must be decided on the facts,” Dadak said. “The courts are aware that they must be as sensitive as they can after Trafigura.”

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Procedures Costs The Bar