“No-Win-No-Fee”, Lord Justice Jackson and the Claims Management Perspective

Much has been said about Lord Justice Jackson’s preliminary report into the Review of Civil Litigation Costs, particularly in relation to driving down the cost of civil litigation by introducing fixed fees for all fast track personal injury claims

Much has been said about Lord Justice Jackson’s preliminary report into the Review of Civil Litigation Costs, particularly in relation to driving down the cost of civil litigation by introducing fixed fees for all fast track personal injury claims. Little attention has been given to the affect which this proposed change will have on the marketing by law firms and the inevitable impact which this will have on access to justice and the quality of advice provided by law firms. 

Claims Management Companies and law firms have had a rollercoaster relationship since the introduction of the Conditional Fee Agreement. However since the claims management industry became regulated by the Ministry of Justice in 2006, law firms have found, once again, that reputable referrers are able to provide an outsourced marketing tool, enabling law firms to attract greater business, to ensure clients have greater access to justice and that the client’s best interests are maintained because law firms can concentrate on doing what they do best, being lawyers. 

Rebecca Young of Accidents Direct believes the very same “Accidents Direct is an industry leading Claims Management Company. We specialise in generating personal injury enquires through our understanding of the market and through the marketing apparatus which we have put in place here”. Rebecca Young goes on to state that “The law firms which have been selected to join the Accidents Direct panel bring their legal expertise in addition to sharing our attitude to client care”. Through our individual skill sets we and our panel member law firms are able to ensure that each client receives the best possible service from start to finish”. 

The proposed introduction of fixed fees for all fast track personal injury claims will undoubtedly affect the business relationship between law firms and referrers, with one conclusion being the death of the referral fee (the fee paid by solicitor firms to referrers for personal injury work). This gap in the market would ultimately have to be filled by the law firms, who without claims management companies to refer claims, would suffer from a reduction in claimant personal injury work. The question the legal hierarchy must ask itself is, how does the profession see the role of law firms developing? 

An unforeseen implication of the Lord Justice Jackson report could see law firms becoming more like claims management companies, investing heavily in online and television advertising in an ever competitive and aggressive market. Legal advice will then be dominated by law firms with the most Sponsored Links and expensive T.V. advertisement campaign. This would drive down competition, destroying the personal injury practice amongst the smaller firms and ultimately reduce the quality of service provided by a conveyor belt of Pay-Per-Click personal injury lawyers. 

Despite Lord Justice Jackson’s best intentions to drive down the cost of civil litigation, what he might actually find is that he creates are far more bullish legal environment with fewer law firms concentrating more on Pay-Per-Click than drafting Particulars of Claim. Rebecca Young states “At present Claims Management Companies do the [advertisement] work so law firms don’t have to. Accidents Direct carries out general personal injury vetting prior to referring the claim but we defer to the expertise of our panel members to provide the legal advice. Our panel members are the legal specialists and we are the marketing specialist. Together we provide an excellent service for the client”.

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