Legal Aid Bill [Lords]

Part of the debate – in the House of Commons at 6:15 pm on 4 May 1988.

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Photo of Mr Michael Irvine Mr Michael Irvine , Ipswich 6:15, 4 May 1988

A great deal of the anxiety felt in the legal profession about this Bill stems from the disappearance of the words that were to be found in the previous legislation. They were: fair remuneration according to work actually and reasonably done. The omission of those words causes worry. Solicitors, and my fellow barristers, see matters listed in clause 34(7) which the Lord Chancellor has to take into account. They see nothing particularly exceptionable in them but they ask themselves whether the omission of those words means that the principle of fair remuneration has been abandoned. They then look at subsection (8) and see that the Lord Chancellor must consult the general council of the Bar and the Law Society and feel somewhat relieved. However, any such relief is dissipated when they look over the page and see that subsection (11) provides: No regulations shall be made under this section which include provision for the purposes mentioned in sub-section (2)(c) or (e) above except with the consent of the Treasury. The anxiety stems from that.

I concede that inadequate remuneration can all too easily lead to inadequate performance and a fall in standards, but I ask my fellow members of the Bar and solicitors to have regard to the substantial increase in Government money and resources which have been devoted to the legal aid scheme in recent years. In 1978–79, it was running at about £100 million a year. This year, the figure will he close on £450 million. By any standard, that is a substantial increase. It is true that costs have also risen markedly during that period, but both branches of the profession have benefited substantially and it is right that I, as a practising barrister, should mention that I have shared in that benefit.

The trouble is that the demand for legal services, rather like the demand for the National Health Service, is virtually infinite. If demand is unleashed without proper regard to the costs of providing services, it will grow uncontrolled and will increasingly become a burden on the Exchequer. It will lead to the courts becoming clogged and to an increasingly severe strain being put on their operation.

I hope that the new legal aid board will ensure that members of the legal profession doing legal aid work are properly remunerated, and that lack of means does not cut anyone off from legal advice and representation when it is needed. However, it should maintain a far more careful scrutiny than has previously been the case as regards waste and abuse. The vast majority of practitioners are competent and scrupulous in ensuring that abuse does not occur. All of us who have practised in the courts know that some abuse and quite a lot of waste occurs nevertheless. I was glad that my hon. Friend the Member for Croydon, North-West (Mr. Malins) mentioned the question of matters that should be dealt with in the magistrates court finding their way at considerably increased expense to the Crown court. That is an example of how costs could and should be saved.

All of us who practise know that in some cases people obtain legal aid who should not have obtained legal aid. We know that in far too many cases, through delay and inefficiency, proceedings meander on, causing frustration to litigants and unnecessary expense to the legal aid fund. The Legal Aid (General) Regulations 1980 already provide for sanctions in that regard. Regulation 104(1) provides: …on any taxation of an assisted person's costs in connection with proceedings (except authorised summary proceedings and proceedings in the Crown Court) any costs wasted by failure to conduct the proceedings with reasonable competence and expedition shall be disallowed or reduced…. I believe and hope that the new legal aid board will make sure that such powers are used more rigorously. It is no good the professions calling for fair and reasonable remuneration unless we are prepared to allow the legal aid board to ensure that the waste and abuse, which to some extent exist, are kept under very tight control and eliminated as far as possible.

In general, I support the Bill's provisions wholeheartedly, but one important criticism that I have of it is that it leaves untouched the restrictions on the power of the courts to order payment of successful unassisted litigants' costs out of the legal aid fund. That matter was rightly raised by my hon. Friend the Member for Portsmouth, South (Mr. Martin). The grant of legal aid puts the recipient in a very powerful position indeed. I listened with some astonishment to the right hon. and learned Member for Aberavon (Mr. Morris), who spoke of legally aided litigants being subjected to procedural delays and being left at the mercy of well-funded opponents who are privately financed. Far too often the boot is on the other foot, and the legally aided litigant is faced with a not particularly well-off litigant without legal aid. When that happens, the person without legal aid is virtually completely at the mercy of the legally aided litigant.

It is intolerably unfair that a litigant financing proceedings out of his own resources should not only face the disadvantage of conducting a case against a legally aided opponent but in all too many cases should find himself having to bear his own costs, even if he is successful. I am disappointed to discover that in clause 18 the old mistakes are repeated. Subsection (4) provides: An order under this section in respect of any costs may only he made if—(a) an order for costs would be made in the proceedings apart from this Act. That is obviously fair enough. The sting comes in subsection (4)(b): as respects the costs incurred in a court of first instance. those proceedings were instituted by the assisted party and the court is satisfied that the unassisted party will suffer severe financial hardship unless the order is made". So a successful non-legally aided litigant in a court of first instance has no hope of obtaining an order for costs against a legally aided opponent unless the other party instituted the proceedings and, in addition, he can show that he, the non-legally aided litigant, would suffer severe financial hardship unless such an order was made.

If ever a case demonstrated the unfairness of that provision it was the case of Kelly v. London Transport Executive (1982), 1 WLR, 1055. In that case the plaintiff suffered a very minor accident indeed and concocted a vastly inflated amount of injury and damage flowing from it. The defendants paid £750 into court. The plaintiff did not take it. The defendants made an offer of £4,000 in desperation, to avoid the mounting costs, and he still did not take it. Eventually, he pressed the matter to a conclusion. The judge who heard the case found him to be an unscrupulous liar. His story was shown to be absolutely untrue. He was awarded just £75 in damages. Because the defendants were unable to bring themselves within the ambit of the provisions now contained in clause 18(4)(b), they received no costs at all, in spite of the fact that long before the hearing they had paid £750 into court and had later made an offer of £4,000. That is a grievous injustice.

It may be argued that such a reform would result in a very substantial amount of extra costs being incurred. I acknowledge that that is a risk and that that argument is important. However, it is a reform which should be considered. If the legal aid fund were at risk for costs, it would concentrate powerfully the minds of the legal aid board and of those acting for the legally aided party. That of itself could well lead to a saving in costs that would counterbalance to some extent any extra expenditure that would have to be met if the reform that I suggest were made.

I strongly believe that the principle of fair and reasonable remuneration should be retained. However, we lawyers do ourselves no service if we think that by a wave of the hand we can rid ourselves of Treasury control. It is not right that we should do so. It is right that the Treasury should be there and that the legal aid board should bring its forces powerfully to bear on the problem of saving costs and making our legal system more efficient.