Grayling goes ahead with massive RTA portal fee cut

Justice secretary Chris Grayling has confirmed the worst fears of claimant personal injury lawyers by announcing that RTA portal fees will be cut from £1,200 to £500 “from the end of April”.

Grayling said the fee for handling claims worth £10,000 to £25,000, which will enter the portal “from the end of July”, would be £800.

For employers’ and public liability cases, which will be entering the portal at the same time, the fees will be set at £900 for cases worth up to £10,000 and £1,600 for cases worth up to £25,000.

Insurers welcomed the move. “This is very good news for customers who will benefit through lower car insurance premiums as unnecessary legal costs are removed from the system,”  said James Dalton, head of motor and liability at the Association of British Insurers.  "The Government is to be congratulated for grasping the nettle on this issue and resisting the scare-mongering claims of ambulance-chasing lawyers.”

The news comes as the High Court prepares to consider on Friday (1 March) a judicial review brought by APIL and MASS challenging the fee cuts.

Grayling said that in “exceptional circumstances”, where cases were in the £10,001 to £25,000 bracket, the cost of a barrister or specialist solicitor’s advice on quantum should be recovered as a disbursement, in the same way as experts’ reports.

The justice secretary also said that for “claims arising out of employers’ liability disease cases” which fell outside the protocol, the existing costs regime should continue.

Justice minister Helen Grant had previously suggested just before Christmas that mesothelioma claims should be handled by a portal.

As Grant proposed in November last year, fees for cases falling outside the protocol will be calculated according to a “matrix of fixed recoverable costs”, based on the table recommended by Lord Justice Jackson in 2009, increased to take account of inflation but reduced to by an amount “intended to reflect the forthcoming ban on referral fees”.

Under the matrix, fees for non-portal RTA claims worth £1,000 to £5,000, which settled before issue, would be the greater of £550 or £100 plus 20 per cent of damages.

For similar claims worth £5,000 to £10,000, it would be £1,100 plus 15 per cent of damages.

Fees for employer’s and public liability cases worth £1,000 to £5,000 which left the portal and settled before issue would be £950 plus 17.5 per cent of damages in both cases.

This would rise to £1,855 plus 12.5 per cent of damages for employer’s liability cases or 10 per cent of damages for public liability.

Grayling said the new fixed costs regime will be implemented at the same time as extension to the portal at the end of July.