Legal Aid, Sentencing and Punishment of Offenders Bill

My Lords, Amendments 136, 137 and 140, which are in my name and supported by others, are designed to protect access to justice for vulnerable victims of human rights abuses committed in developing countries by UK multinational companies. I thank the Minister for meeting me to discuss these amendments, and I know that he shares my commitment to ensuring that this Bill will do nothing to undermine or impede access to justice for some of the world's poorest and most vulnerable people. Unfortunately, without these amendments—or amendments along these lines—there will be a serious risk of doing exactly that. I am grateful also to CORE, the corporate responsibility coalition which includes CAFOD, Amnesty, Oxfam and other leading international NGOs, for their support for these amendments. I should also declare an interest as an independent consultant on corporate responsibility. The sort of cases I am referring to are few and far between. There have been only nine or 10 in the past 15 years, which reflects the high cost and high risk of bringing such cases in the first place, so we are not looking at a situation where any floodgates are likely to be opened by retaining the current system. We are talking about cases such as the one against Trafigura in 2006 on behalf of 30,000 residents of Côte d'Ivoire who were affected by the dumping of toxic waste, or the one against Monterrico Metals in Peru, where 28 people who objected to the mining company's development plans were detained and tortured. That case was finally settled in 2011, five years after the incidents. I will not recite details of all the other cases but I assure your Lordships that whether we are talking about asbestos miners in South Africa, campesinos in Colombia or Peru, or communities living in Abidjan, these are people who face indescribably difficult hurdles in seeking justice against the multinational companies which have harmed them. In a context where there is a clear imbalance in influence, economic clout and access to legal expertise, the odds are stacked against them already and it is vital that we do not close off the route to justice in the UK courts that occasionally can be pursued. In theory—and I acknowledge that this is the Government’s present position— these human rights abuse cases could still be brought. The Bill does not actually say that they are forbidden in any way but I would argue that in practice, the changes proposed to the structure of the costs regime for civil litigation mean that such cases would effectively be too costly and too risky for any law firm to undertake. As a consequence, vulnerable people will be abandoned and denied justice. The Bill, as we have heard in debates on other amendments, proposes that success fees should be taken from the damages awarded to the claimants instead of from the company in cases such as the ones I have described, and that they should be capped at 25 per cent of costs. In addition, the Bill would abolish the recoverability from the company of ““after the event”” insurance premiums if the company loses. Together, these two reforms would effectively annihilate the chances of any legal firm being in a position to start the lengthy process of such a case, inevitably involving a great deal of expensive overseas travel, the commissioning of scientific and medical expertise and so on. Indeed, there are already massively high legal hurdles which have to be cleared before a case can reach the courts in the UK—for example, proving to the court that no relevant in-country resolution is possible and that corporate liability at a global level is indeed arguable, rather than the human rights abuse being the result of some error or misdeed by a local subsidiary. I stress that I have no quarrel with the Bill’s intention in principle to rationalise the costs system and to save money, but my amendments do not interfere with that overarching objective. They do not seek to spend a single penny of taxpayers’ money from the public purse; they simply seek to retain the present system, under which damages may be paid by the company itself. When it comes to the recoverability of ““after the event”” insurance premiums, the Bill already includes an exemption for cases of clinical negligence and I hope that the Government agree that it would be right—and equally, in the public interest—to extend that exemption to human rights abuses in the sort of cases I have mentioned. As I said earlier, I believe this can be done without opening any floodgates. However, if the Minister feels that this perhaps could be achieved with more precise wording than I have managed to craft in my amendments, I hope he will agree to take this away and give it further thought, and perhaps come back on Report with something that can do an even better job. I am also aware, thanks to the helpful meeting with the Minister, of the Government's view that damage-based agreements, or DBAs, would in future provide an arguably better route to justice for human rights abuse victims, because they are particularly suited to group actions where lawyers’ fees may be recovered as a percentage of the damages awarded to successful claimants. However, I urge real caution before the Government satisfy themselves that this would be the right way to go. In a jurisdiction such as the US, where claimants receive much higher levels of damages, DBAs may well be appropriate but in the UK, where compensation payable by defendants is relatively modest, victims would be denied a proper remedy if the costs burden associated with litigation is shifted from defendants on to claimants, as the Government intend in this Bill. This would apply particularly to claimants from developing and emerging countries, where damages are calculated at local rates whereas the lawyers’ fees reflect the UK’s high level of legal costs. By contrast, our present system has been praised by no less a figure than Professor John Ruggie, the United Nations special representative on business and human rights. His Protect, Respect, And Remedy framework was adopted only last year by the UN Human Rights Council and was warmly welcomed by the UK Government, who took an admirable and leading position in discussions at the UN to commit to translating the framework’s principles into practice in the UK, and to encourage others to do likewise in their countries. Professor Ruggie himself highlighted to the UN Human Rights Council the UK’s current system of deferred ATE premium payments as an example of how innovative, market-based mechanisms can help keep the costs of bringing a legitimate claim to a reasonable level. Why on earth would the Government want to ditch such an important and well recognised system now? Even more recently, the Joint Committee on Human Rights published its report on the Bill, also drawing attention to the views of Professor Ruggie and the dangers of the proposed changes to litigation funding, which in his view could, "““constitute a significant barrier to legitimate business-related human rights claims being brought before the UK courts in situations where alternative sources of remedy are unavailable””." The Joint Committee urged the Government to introduce appropriate amendments to the Bill, and I hope the Minister will agree that the amendments that I have put forward are a good place to start. They are not anti-business but pro-responsible business and will help to drive up standards. There may well be a risk that, without them, some businesses will find it easier to regard themselves as off the hook when it comes to observing their human rights obligations in developing countries. I really do not want the UK to be responsible for that, and I am sure that the Minister does not either. I should add for clarity that the definition of a developing country in subsection (9) of Amendment 136 is taken directly from the World Bank’s definition, and I understand that there is general consensus that that definition is fair and workable. These are sensible amendments, in line with government policy and the basic objective of the Bill with zero cost implications for the public purse, that would continue to provide access to justice for some of the world’s most vulnerable people. There are enough obstacles in their way already; please let us not add another. I beg to move.