PUBLIC. CIVIL JUSTICE COMMITTEE Minutes of the meeting on 12 November 2014 at in the Holborn/Lincoln Room, 113 Chancery Lane, London

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1 Posted on Corporate Business on 10 December 2014 as approved by the Chair Present: Apologies CIVIL JUSTICE COMMITTEE Minutes of the meeting on 12 November 2014 at in the Holborn/Lincoln Room, 113 Chancery Lane, London Part 1 David Marshall (Chair), Patrick Allen, Peter Causton, Peter Ellis, Keith Etherington, Nichola Evans, David Greene, Tony Guise, Juliet Herzog, Charlie Jones, Sophie Khan, Stephen Lawson, Stephen Mason, Richard Schaverien, Phillip Tracey and Jonathan Wheeler. Michelle Penn, Tim Smith, Craig Underwood. By Invitation Andrew Ritchie, QC (minute 28) In attendance Glossary of Abbreviations Michael Birtwistle, Civil Justice Policy Advisor (minutes and 34) Flick Heron, Council and Board Administrator Martin Heskins, Civil Litigation Policy Advisor Robert Khan, Head of Law Reform (minutes and 34) CMC Civil Mediation Council CPD Continuing Professional Development CPRs Civil Procedure Rules EU European Union IPC Intellectual Property Committee IPO Intellectual Property Office LASPOA Legal Aid Sentencing and Punishment of Offenders Act MoJ Ministry of Justice SRA Solicitors Regulation Authority 25 ANNOUNCEMENTS AND DECLARATIONS OF INTERESTS There were no announcements. Tony Guise declared an interest in the item on Arbitration in Personal Injury Claims due to his involvement with a software supplier which would supply software for the proposed arbitration scheme. 26 MINUTES OF 11 SEPTEMBER 2014 MEETING The Committee approved the Part 1 minutes of the 11 September 2014 meeting. 27 MATTERS ARISING There were no matters arising from the Part 1 minutes. 28 ARBITRATION IN PERSONAL INJURY CLAIMS The Chair welcomed Andrew Ritchie QC to the meeting to present his proposal for arbitration of all multi-track personal injury claims; and commented that while interest in arbitration had increased during the uncertainty created following the decision regarding sanctions in the case of Mitchell v News Group Newspapers Ltd, 16

2 this may have waned in the light of the subsequent decisions in the Court of Appeal. He added that the Society was neither in favour of nor opposed to arbitration schemes but was interested to hear about Andrew Ritchie's proposal. A revised version of the scheme structure, rules and agreement was circulated. Andrew Ritchie said that the civil litigation system was vital to society, needed to operate fairly, efficiently and at reasonable cost and required solicitors on either side to co-operate. Changes to the CPRs in April 2013 had led to a focus on procedural compliance, rather than justice between the parties, as well as making funding of claims more difficult. There were also problems with the efficiency of the court system with papers getting lost, late issue of orders, long waiting times for hearings and frequent late hearing adjournments. In addition, costs budgeting was an extra burden for solicitors, the system was inflexible and court fees had risen. There was also no guarantee that judges dealing with personal injury cases would be expert in that field. Andrew Ritchie proposed that the parties involved should take back control of the claims process and re-establish co-operation, using a simple, fast and efficient system of arbitration. Arbitration was already successfully used in other areas of law such as shipping, defence and commercial cases. The PIcARBS scheme was proposed, based on the CPRs before April 2013, using arbitrators who were Queen's Counsel expert in personal injury and clinical negligence. Orders and directions would be agreed between the parties or otherwise by the arbitrator via electronic means, telephone or at a physical hearing. Once evidence was served the arbitrator could assess liability and quantum on paper, or the parties could opt for a joint settlement meeting or a full hearing. Rules for striking out cases would revert to those that existed before April 2013, so cases would not be struck out for procedural failure. Costs budgeting would not apply, but each side would need to inform the arbitrator of their costs. The old rules on conditional fee agreements would apply. Hourly rates would be agreed at the outset and costs orders would be made at the end of the case with claimants' liability to pay defendants' costs capped at 20% of damages. Unlike the court system, appeals would be allowable on points of law or procedure but not on the facts of the case. The system would use electronic communication and service and filing of documents, although communication between the parties could be by any preferred means. The system fee would be 1,000 per case, initially payable by the defendant, with a 300 per hour fee for the arbitrator and hourly rates for the lawyers and experts to be agreed between the parties or set at the scheme's default rates. It was anticipated that the case fee could be reduced if the scheme proved popular. PIcARBS was non-profit making and the system would be cheaper and more co-operative than the court system. Andrew Ritchie responded to comments made by Committee members as follows: 17

3 He would check whether the system would provide for disclosure applications; The parties could add clauses to the arbitration agreement; these could cover issues such as the appointment of experts, representation at hearings by a solicitor rather than a barrister, and whether different arbitrators should be used if a full hearing followed an early neutral assessment; The fees had been set at a rate which it was hoped all parties would be happy with, and did not aim to provide a cheap service; if a long hearing was expected the parties might negotiate a lower rate; Claims with multiple defendants would require the agreement of all parties; alternatively, it might be possible for the claimant to seek arbitration with one defendant and for that defendant to pursue a recovery against the others through the courts; Insurers were being consulted and their support would be necessary for the scheme to be successful; it was hoped that it could become a requirement within before-the-event and motor insurance policies; the requirement might be that an arbitration agreement would be issued but not proceeded with until further steps had been taken, such as collection of evidence; the system was very similar to mediation, although more formal; the independence and experience of Queen's Counsel was preferred at the outset but once the scheme was established it could use junior counsel or senior solicitors as arbitrators, although a wider panel would require more administration; all the scheme arbitrators would be required to have an appropriate arbitration qualification; although arbitration was confidential, anonymised decisions would be publishable. In conclusion, Andrew Ritchie recommended the PIcARBS scheme, and said that the proposal had been published to promote discussion. The market might establish alternative schemes and while either side might want to be able to control the adopted system, neither would accept a scheme controlled by the other. The consultation would run until spring The Chair said that the Committee would discuss the proposal at its next meeting. Martin Heskins 29 CIVIL JUSTICE EVENTS UPDATE Martin Heskins said that in October the Civil Justice Section Conference and the Commercial Litigation Conference had taken 18

4 place, attracting 84 and 94 delegates respectively, and both had received positive feedback. In addition, an event the previous week in Manchester on sanctions and cost management had attracted 20 delegates and another, taking place in London in December, had 16 delegates to date, although two events in other regions had been cancelled due to low registration, and it was possible that interest had waned since the Court of Appeal decision on sanctions. At the Manchester event, there had been a group exercise on cost budgeting, which showed some improvement in the delegates' approach since earlier events. A small focus group for invited guests was due to be held in December as part of the Society's Access to Justice campaign. If successful, a programme of similar events was likely. Martin Heskins would be planning a bigger event for 2015 on LASPOA and the civil justice reforms; and the Civil Justice Section would run an event in the spring, which might also cover these issues. 30 CIVIL MEDIATION COUNCIL UPDATE Peter Causton said that the CMC had now incorporated as a charitable company and the new company remained dormant while the application for charitable status was proceeding. A new CMC website was being set up which would enable online application for accreditation. 31 INTELLECTUAL PROPERTY COMMITTEE UPDATE Peter Ellis said that the Intellectual Property Committee (IPC) was working on improving liaison with the Intellectual Property Office (IPO) and was responding to IPO consultations as usual, as well as monitoring the implementation of the Intellectual Property Act and EU proposals on harmonisation of trade secrets law. At its first meeting, the IPC had discussed how solicitors could protect their position in the intellectual property market. Threats to this position could come from a variety of areas. Foreign attorneys could take work in the Unified Patent Court, although there was also the opportunity for English and Welsh solicitors to obtain international work in the Court and firms needed to be confident in and publicise their abilities, within their limitations. There was also a threat from trademark and patent attorneys, many of whom held rights of audience in court; accountants were starting to provide advice in non-contentious cases; and there was a growing number of unqualified professional business advisors giving advice and drafting patent specifications. The IPC would work on material promoting the use of solicitors for intellectual property work. Civil Justice Committee members were invited to send any suggestions to Peter Ellis. 32 CLAIMS PORTAL MANAGEMENT INFORMATION The Committee noted the Claims Portal management information as at 30 September

5 A more detailed analysis of the Portal management information would be brought to the Committee in the spring. Martin Heskins 33 COMMITTEE WORK PLAN The Committee noted its work plan for The plan for 2014/15 would be drafted soon and Committee members were invited to any suggestions to Martin Heskins or the Chair, although the Committee's work plan would need to link to the Law Society and Corporate Affairs business plans, under which the main civil justice focus for the coming year would be access to justice. 34 ANY OTHER BUSINESS Consumer Rights Bill A Committee member said that the Committee should keep the progress of the Consumer Rights Bill under review; proposals for an opt-out regime for collective actions had been dropped but might be replaced by an opt-in system. Damages Based Agreements Consultation The Civil Justice Council was carrying out a review of damages based agreements on behalf of the MoJ and an update would be brought to the next meeting. Martin Heskins/David Greene SRA Competence Statement Consultation Committee members were invited to send any comments on the SRA's Competence Statement Consultation to Nicole Poole, Policy Advisor. DATE OF NEXT MEETING 15 January Old Bookshop The meeting finished at Members could claim 2.5 hours CPD for the meeting. 20

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