My Lords, I am grateful to the noble Lord, Lord Howarth, for raising these issues, because it gives me an opportunity to raise some of the questions around legal costs and about the work that has to go into preparing a case under the proposed scheme.
My first question concerns civil cases and the information that has been provided to us in the tariff about the awards. Is it net or gross, and does it include the legal costs? Have they been excluded from the awards or do they come on top? If they are on top, we need to know what kind of money has been paid to lawyers when a claimant has been awarded in order to be able to judge whether the figures in the documentation before us are accurate. I had always assumed that the impact assessment would provide accurate information, so I was rather stunned to realise that the figures of £7,000 for a successful applicant, £9,000 for an unsuccessful applicant downgraded to £2,000, is something of a leap. If you are a sufferer or the relative of a sufferer, engaging a lawyer to do the preliminary work that is necessary to undertake this sort of action presents some sort of risk if the application fails. I want to explore that area as well.
The impact assessment gives an estimate of unsuccessful legal fees as £3 million out of a total of £24 million. A rough division shows that one case in every eight is unsuccessful, so if you are the one person out of the eight, presumably in a civil case action you are going to have to find those fees, unless of course you can find a no-win no-fee lawyer. I raised this issue at Second Reading. It seems that if you were about to embark upon this legal route, unless there is some form of support guaranteed at the end of it it would be the no-win no-fee lawyer to whom you would have to turn. I would be grateful if my noble friend could confirm that or tell us what alternatives there are.
The issue of evidence that requires a lawyer is quite substantial. Having now had the benefit of seeing the draft rules for the scheme, Part 1 paragraph 2 lists the evidence that an applicant may be required to provide. It is quite substantial and includes the history of employment and the companies to which the applicant is referring. In civil cases the courts have made it clear that you have to prove negligence, and three tests are given in the Appeal Court judgment. Three measures have to be satisfied in order to prove negligence. My second question, therefore, is: does the applicant have to prove negligence? That would be far more difficult to do in a case where the company or insurer is not present, unless the word of the applicant is determined to be acceptable.
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My third question relates to the balance that the applicant will have in this scheme. If there is no tracing fee, which is the implication in the Bill, that clearly saves a considerable amount of money for the applicant in unsuccessful cases. However, paragraph 83 in the impact assessment of May says:
“Applicants for payments under the scheme will incur legal costs in making their application … it is assumed that the scheme payment will include an amount to cover this”.
Does that mean that this will be taken from the amount which the scheme payment makes? If that is the case, the actual payment will be even further
reduced. I hope my noble friend can answer that question as well. There are some very grey areas about the information that we have been given and some very substantive questions that need to be answered. I hope my noble friend will be able to do that.