Public perceptions of the civil litigation system and third party litigation funding Findings from quantitative and qualitative research conducted by BritainThinks Ben Shimshon, Founding Director, BritainThinks
What we did 6 focus groups among adults aged 18+ Qualitative phase Split by socioeconomic grade: 3 focus groups of ABs and 3 focus groups of C1/C2 Spread across three locations in England Fieldwork dates: 6 th 9 th October 2014 Quantitative phase Survey of 1,261 adults aged 18+ in England and Wales* Online methodology Fieldwork dates: 31 st July 4 th August 2015 Data weighted to be representative by gender, age, region and socioeonomic grade *The survey focuses on the population of England and Wales (rather than Great Britain or the United Kingdom) because of significant differences between the legal system in Scotland and Northern Ireland compared to England and Wales.
1 The public is more likely to feel the legal system in England and Wales is moving in the wrong direction than the right direction 2 3 4 Perceived symbols of this negative shift include increases in claims filed, advertising for mis-selling, no-win-no fee cases and other legal services These views are consistent across the population, but older people are particularly concerned about this growing compensation culture Against this backdrop, public responses to the practice of third party litigation funding (TPLF) tend to be very negative 5 6 The most compelling reasons for TPLF relate to access, but for most, these are outweighed by concerns about profiteering at the expense of justice There is widespread support for greater control of TPLF practices, and in particular a mandatory code of conduct
The public are twice as likely to see the civil litigation system as moving in the wrong direction than the right direction The population overall: Those who express an opinion only: 21% 41% 35% 65% 38% Moving in the right direction Moving in the wrong direction Don't know Those who have been involved in a civil case in the past 10 years are much more likely than average to say that the system is moving in the wrong direction (52%) Q1. Given what you know, do you feel that civil litigation in England and Wales is... Base: All respondents (n=1,261)
The majority of the public describes an increase in claims filed in the past three years More frequently About the same Less frequently Compensation for misselling of products (e.g. PPI) 79% 11% 1% No-win-no fee cases 73% 15% 2% Advertising of legal services 71% 16% 3% People trying their luck to get compensation 71% 15% 2% Personal injury and workplace accident claims 70% 17% 2% Sales calls or texts from lawyers 50% 21% 5% Q5. Thinking about the past three years in the UK, based on what you have experienced, seen or heard, do you feel that the following things happen more frequently than they used to, less frequently than they used to, or about the same as they used to? Base: All respondents (n=1,261)
And most of these practices are seen as having a negative effect on the justice system in England and Wales some overwhelmingly so Negative impact 6% 6% People 'trying their luck' to get compensation Sales calls or texts from lawyers -89% -89% Positive impact 21% Advertising of legal services -67% 31% 35% No-win-no fee cases Personal injury and workplace accident claims -59% -55% 47% Compensation for misselling (e.g. PPI) -45% There are so many really aggressive adverts like you deserve your money and you deserve it now! I ve already received compensation for PPI and still the number of calls I get saying I m entitled to it it s ridiculous. They re just completely bogus companies. Q6. You said that the following things happen more often than they used to. For each, do you think this has been positive or negative for the justice system in England and Wales? Base: All respondents who consider each to happen more than it used to (n=629 1,002)
Consistently, members of the public describe a growing compensation culture in England and Wales 83% of the public agrees that there is a growing compensation culture in England and Wales nobody takes responsibility for their own actions any more It seems that everyone is claiming for the smallest thing. Employers, businesses and even family and friends can be sued over the silliest thing. Health and safety has taken over common sense. People are being encouraged to extract money from companies and other people... some people think it is an easy touch for compensation when really they have no claim to anything. 79% of the public agrees that small businesses are under threat of being sued in England and Wales Q8. To what extent do you agree or disagree with the following statements? Base: All respondents (n=1,261)
These views are consistent across most sociodemographic groups, but concern is particularly high among older people Agreement that there is a growing compensation culture in England and Wales is highest among Older compared to younger people Right compared to liberal/left-leaning voters Those who believe our system is becoming more like the US s 94% of over-55s 72% 80% of under-35s 89% 92% of Conservative / UKIP voters of those who voted for others 71% of those who agree of those who disagree Q8. To what extent do you agree or disagree with the following statements? Base: Varies for each sub-group
For many, this trajectory is summed up as the Americanisation of the litigation system The population overall: 13% 31% Those who express an opinion only: 19% 81% 56% Agreement/disagreement that civil litigation in England & Wales is becoming more like the US Disagree Don t know Agree Q3. To what extent, if at all, would you agree or disagree with the following statement? Civil litigation in England and Wales is becoming more like the United States. Base: All respondents (n=1,261)
Against this backdrop, public responses to the practice of third party litigation funding tend to be very negative Respondents were shown a short passage explaining TPLF: Then asked to rate how positive or negative they 2% felt about TPLF: Third party litigation funding is where financial firms (for example, hedge funds and private investment firms) that have no direct connection to a legal dispute invest in the case. These firms identify cases where there is likely to be a large settlement and pay the associated legal and administrative fees on behalf of the claimants. The third party litigation industry in the UK is growing. If the case is successful, the financial firm funding the case claims a significant share of the financial settlement awarded to the claimants (generally 30%-40% of the settlement). If the case is unsuccessful, the funder and the claimants get nothing. 23% 29% Very positive Quite negative Don't know 12% 34% Quite positive Very negative Q13. How positive or negative do you feel about the increase of third party litigation funding in England and Wales? Base: All respondents (n=1,261)
The most compelling reasons for TPLF among the public tend to relate to access to justice Net agreement with each argument Legal Aid has dried up in recent years - TPLF will change that, funding cases that might not otherwise be brought to court 9% TPLF helps consumers stand up to big businesses and make them do the right thing -11% TPLF helps consumers stand up for their rights, making the consumer voice stronger -18% TPLF creates a level playing field for consumers, who can hold businesses to account -20% TPLF is an innovative form of investment, offering investors new opportunities for wealth creation -25% Net agreement (% agreeing minus % disagreeing) Q14. You will now see some of the arguments that people have made in favour of third party litigation funding. Please state the extent to which you agree or disagree with each argument. Base: All respondents (n=1,261)
while the strongest reasons against relate to a perception that TPLF is purely about delivering profit, rather than justice These firms only fund the cases they think they can win, not the cases they think are just Net agreement with each argument 59% Third party litigation funders exist to make a profit, not to deliver justice Financial firms fund the cases that will make them the most money Third party litigation funders do not care what is in consumers' best interests TPLF diverts money away from the rightful claimaints to greedy businesses If there's one thing we've learnt from the financial crisis, it's that innovation on the part of financial firms can do more harm than good 56% 56% 54% 52% 48% Net agreement (% agreeing minus % disagreeing) Q15. You will now see some of the arguments that people have made against third party litigation funding. Please state the extent to which you agree or disagree with each argument. Base: All respondents (n=1,261)
while the strongest reasons against relate to a perception that TPLF is purely about delivering profit, rather than justice It seems to go against the foundation of what we see as justice in this country. It s corruption, there s no other word for it. The cases that should go forward morally won t be the ones that go ahead. They will pick on businesses with a weak defence.
There is widespread support for greater control of the practice, particularly a mandatory code of conduct and a cap on fees Agree Don t know Disagree % selecting as No.1 A mandatory code of conduct with meaningful penalties 84% 13% 3% 33% A cap on the fees funders can charge and proportion of settlement they can claim 81% 15% 4% 25% Government licensing of all third party litigation funders 77% 18% 5% 18% Ban the practice of TPLF altogether 41% 33% 26% 21% Keeping the voluntary code of conduct for TPLF with no other regulation 22% 21% 57% 4% Q19. To what extent, if at all, do you agree or disagree with each of the following options to manage third party litigation funding? & Q20. And if you had to choose one, what would you do to manage third party litigation funding? Base: All respondents (n=1,261)
For further information, please contact: 020 7845 5880 / bshimshon@britainthinks.com