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NHS Resolution Court of Appeal success in ‘bulk conversion’ cases

Earlier today, NHS Resolution issued a press release concerning a judgement that has been handed down in three test cases looking at ‘bulk conversion’ from legal aid to no-win no-fee funding. Please see below for the press release in full.

NHS Resolution has saved the NHS £270,000 in legal costs claimed across three test cases heard in the Court of Appeal with potentially millions of pounds more savings expected on cases waiting in the wings.

In line with its strategy to tackle excessive legal costs, NHS Resolution identified a pattern of claimants being moved by lawyers from legal aid to no-win no-fee funding, just prior to changes in the rules resulting from the ‘LASPO’ reforms in April 2013. NHS Resolution argued that this was not in the interests of harmed patients due to the deduction which would be made from their damages and the significantly higher costs which their lawyers could claim from the NHS.

In three separate cases of S v Barnet and Chase Farm Hospital NHS Trust, AH v Lewisham Hospital NHS Trust and Y v Doncaster & Bassetlaw Hospitals NHS Foundation Trust, the costs judges agreed, ruling that solicitors had failed to provide material advice to their clients, or that the advice given was flawed in a material way.

When these three rulings were overturned, NHS Resolution sought clarity from the Court of Appeal, whose unanimous ruling can be found here. At paragraph 60 LJ Lewison says:

“The bottom line is that in each of the three cases the advice given to the client had exaggerated (and in two cases misrepresented) the disadvantages of remaining with legal aid funding; and had omitted entirely any mention of the certain disadvantage of entering into a CFA. Moreover, one of the advantages of entering into the CFA was Irwin Mitchell’s own prospective entitlement to a substantial success fee. In those circumstances I consider that DJ Besford was correct in saying at [81]:

“Where one of two or more options available to a client is more financially beneficial to the solicitor, the need for transparency becomes ever greater.”

NHS Chief Executive, Helen Vernon said: “We welcome the Court of Appeal’s decision in this case which shows how important it is for claimants to be properly informed when it comes to their legal costs. Having detected this issue and taken the decision to challenge it through the higher courts, we were able to save significant sums for the NHS whilst ensuring that claimants receive the compensation they are entitled to.”

Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.

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