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Clause 1. — (Power to Award Costs Out of Legal Aid Fund.)

Part of Orders of the Day — Legal Aid Bill – in the House of Commons at 12:00 am on 23rd January 1964.

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Photo of Sir John Hobson Sir John Hobson , Warwick and Leamington 12:00 am, 23rd January 1964

That is quite right, of course. We are discussing only those who find themselves faced with a State-aided litigant. As the hon. Member for Pontypool (Mr. Abse) pointed out, for a great number of years, under the system of litigation which has existed in this country, impecunious plaintiffs have been assisted by someone else, quite properly, and, as the hon. Member for Oldham, West (Mr. Hale) said, with very great generosity, on many occasions. The defendant in those circumstances has had little chance of recovering his costs. It is proposed now, if the Amendment be accepted, that in the majority of such cases, because of the accident of State assistance rather than private assistance for the plaintiff, the happy defendant should be very much better off by having his costs guaranteed.

If the only limitation were that the courts would have to find that it was just and equitable that a successful unassisted litigant should have his costs, the court would, as has already been said, not really be embarking upon a financial examination of the situation at all. It would say only this: "Here is an insurance company, a very large corporation. It has been sued, and the plaintiff has failed. It will have to pay the costs. It will not get them out of the plaintiff. Therefore, it is just and equitable that it should have the money out of the State".

I submit to the Committee that there are other considerations which the court would not take into account but which the House ought to take into account on the general policy of giving assistance to those who are the unassisted opponents of legal-aided plaintiffs. Such considerations might very well not be in the minds of judges, who would be considering individual cases and not the general principles and consequences of taking a series of individual decisions.

As the right hon. and learned Member for Newport (Sir F. Soskice) said on Second Reading, it is very difficult for judges to apply a formula such as "just and equitable" if they have no signpost to indicate the circumstances which they should take into account. I suggest that it is right that Parliament should ensure that general principles and considerations of general policy about the way in which the legal aid fund should operate should be indicated by a signpost to the judges so that they know Parliament's intention.

We are not considering on this Amendment whether the phrase "severe financial hardship" is a happy one or the right one, or whether it can be improved. I will, with permission, say a word about the points raised on this matter by the right hon. and learned Member for Newport. All that we are considering is whether there should be no other qualification than that the judge should think it just and equitable or whether it is right that there should be some other test as to the circumstances in which a successful unassisted litigant should have his costs out of public funds. As I have said, the Amendment would leave the gateway wide open for the vast majority of successful unassisted litigants to be supported out of public funds.

I suggest the following reasons why we should give a signpost to the judges which is more narrow than to ask them to consider whether in the individual case before them it is just and equitable that the successful litigant should have his costs out of public funds. It is not right of my hon. Friend the Member for Tiverton to say that the only thing that the Government are interested in is the financial aspect. That is important, but I put it as the last consideration, and it is a travesty of my speech on Second Reading to suggest that that was the only argument advanced against the proposal in the Amendment.

The first reason why I suggest that we need a narrower formula is that the wide formula would involve the State in supporting both sides in numerous cases. Each side would be litigating in the certain knowledge that if it were successful it would be almost bound to recover its costs, which would be paid in full. It is true that there are many cases in which both parties are supported by the State, but they are cases in which both parties are within the limits which qualify them for legal aid, and, therefore, they are people who, according to the rules and regulations, need the support of public funds. Even in those circumstances it sometimes causes a good deal of comment to be made against the legal aid fund that, even though each needs support, two parties are litigating at public expense. But a situation in which one party was in need and the other party, who was not in need, knew that he had a guarantee of his costs provided that he was successful would be a very unhappy one and, as the hon. and learned Member for Liverpool, Edge Hill (Mr. A. J. Irvine) pointed out, it might bring the operation of the legal aid scheme into some disrepute.

The result certainly would be this. First, it would place all unassisted litigants in a far better position than they would have been had there been no legal aid scheme because, long before legal aid was introduced, impecunious plaintiffs could bring actions and defendants had no hope of recovering costs from them even though they were successful. That situation still obtains. Any plaintiff, even though impecunious, who does not need to proceed with legal aid can, and often does, prefer not to pay the charges which, as the hon. Member for Oldham, West pointed out, are frequently quite burdensome for poor people. He prefers to proceed more cheaply and can often do so through private practice. In those circumstances, the mere accident of whether he has chosen to take up his legal aid certificate or has preferred to pay a small sum to get the matter dealt with through a private solicitor would make a difference in the question of whether the defendant was certain to recover costs.