Government to consult on how to implement Jackson Review

The consultation, which will begin in the autumn, will specifically focus on the reform of Conditional Fee Agreements and seek views on alternative funding arrangements such as Damages-Based Agreements or 'contingency fees'.

Lord Justice Jackson's report recommended, amongst others, banning referral fees, ending the recoverability of success fees and after-the-event insurance from unsuccessful defendants, capping legal success fees at 25% of damages and fixed costs for fast track claims.

Nichola Evans, partner at Browne Jacobson, commented: "There was a real fear that the coalition would simply put Jackson's recommendations on the back burner so the speed and timing of this announcement will surprise many.

"However the consultation will only look at some of the recommendations contained in the report, albeit some of the most important recommendations, such as ATE and success fees. Other matters such as referral fees will be dealt with elsewhere.

"In addition it will be important to see how Lord Young reports on the alleged ‘compensation culture'. Our belief is that it is important for all issues to be dealt with together so that there is a joined up approach.

"It is reassuring that the Government is looking at proposals for fixed costs on the fast track and has recognised the unique problems associated with clinical negligence claims.

However it has left us in the dark when it comes to non personal injury claims and legal expenses insurance.

"The effect of an increase in general damages as a means of offsetting costs must also be looked at in detail, both from the claimant and defendant point of view.

"Since the Jackson report was published many insurers have publically stated that further research needs to be conducted as to whether or not there would be real cost savings should these measures be brought in, with some suggesting that the Jackson measures might actually increase costs.

"Now is the time for proper empirical date to be supplied to the Government on the issue and we would urge all interested parties to participate in this consultation."