ESSAY - THE LEGAL AID

THE LEGAL AID

“It is difficult to judge the success of the reforms in the legal aid provision as we lack agreement on the aims and objectives of a legal aid system.”

INTRODUCTION

I would agree with this statement. To judge the success of a public policy measure it is necessary to firstly establish a set of criteria against which the measure will be evaluated. What criteria will be preferred by an individual or a public body will however not depend on logical reasoning but very much on a political opinion held by the individual. With regard to the legal aid system, there will be a variety of such criteria that could be used to evaluate the system. One criterion could be administrative efficiency, which is setting legal aid applications quickly and looking principally at the procedural aspects of the system. Another criterion could be a notion of justice and wide access to the courts irrespective of the claimant’s or defendants financial means. The third criterion could be the effect of legal aid on the taxpayer. There are obvious contradictions in the criteria. Some might argue that the provision of legal aid is an important pillar of the welfare state seen as the second arm to NHS. Others might be in favour of a system that places as small burden as possible on the taxpayer and free the resources for other areas of social needs, housing, accommodation, social services. The argument could then be that in a market economy each individual has to be responsible for himself and that extends to access to legal services. The line of argument will depend on one’s political opinion. Furthermore, the current legal aid does not clearly represent one single criterion but is the result of an attempted compromise between many, contravening criteria.

In a time of limited public budgets the government has to balance the needs for legal aid with the pressuring needs of other social services such as healthcare and education. Ultimately, cuts have to be made somewhere. It is however, a failure of the system that while cost effectiveness is achieved many people have fallen out of the system. It is a pity that Lord Woolf’s proposal to introduced standardised fees has largely not materialised. Such step would have enabled the insurance industry to offer private legal expenses insurances, which is standard in other countries such as Germany at reasonable premiums. This could have mitigated government withdrawal from an important pillar of welfare state.

LEGAL AID AND LEGAL SERVICES

The Legal Aid Scheme was set up after the World War II by the Legal Aid and Advice Act 1949. The administration of legal aid was in the hands of the law society from 1949-1989 unlike the NHS (a state body). The recent history of legal aid in Britain is a story of failure as the system became increasingly expensive to run while catering for fewer and fewer people. In 1950, 80% of the population were covered by the legal aid provision, but by 1998 the figure has fallen to less than 40%. Critical period was the Thatcher and Major Conservative Administration with the policy of cutting public spending and looking towards ‘the market’ to provide solutions. As the legal aid spending increased over the years various Lord Chancellors embarked on reforms which included changing of the payment system, eligibility criteria revised and control moved from the Law Society to the Legal Aid Board (LAB) (Legal Aid Act 1988). When Labour Party came to power in 1997 it continue with the endeavour to control legal aid expenditure.

In 1993 standard fees (fixing tariff for certain kind of work) for criminal legal aid in the magistrate courts were introduced and practice of franchising (block contracting) initiated. In spite of the changes cost continued to rise and fewer people were becoming ineligible. Increase in expenditure was not accompanied by increase in value for money - the taxpayers and paying more and getting less. In 1996 Lord Mackay ‘capped’ the legal aid budget. Regional authorities of the LAB were given a lump sum and once the money is spent no more were fund made available. Complex cases fell outside the scope of the standard fees and were still paid under the traditional system of calculating the bill after the event. It was thought that this offered lawyers inappropriate financial incentives which meant that funds were not being used effectively.

The civil legal aid problems were not just rising costs, but decreasing group of people who were eligible. Many people of modest incomes fell outside these criteria. They were thus effectively prevented from using the courts because they were too expensive. There were also concerns at the inflexibility of the system. It was difficult to target resources on priority areas. There were areas of unmet need. Ideas for reform focused on the framework for determining lawyers’ rates of pay, which was seen to be inflexible. Standard fees were seen as an improvement, as they allow more government control over expenditure on legal services.

CRIMINAL LEGAL AID

In general, criminal legal aid applied to defendants after they had been charged; legal aid would be granted by a court after an application was made either to the magistrate court or the crown court. A duty solicitor’s scheme was set up in Magistrates Courts and Police station was non-means tested and non-contributory. This is free and was set up to cover the requirements of PACE. The scheme is run by local solicitors on rota basis, the scheme is also free and provide legal assistance to those without representation

REFORM OF LEGAL AID: SOLUTIONS TO THE FUNDING PROBLEM

The AJA 1999 (ss.27-31) together with the Conditional Fee Arrangement Regulations (CFAR) 2000 and the Collective Fee Arrangement Regulations 2000 reformed the law relating to conditional fees to enable the court order a losing party to pay in addition to the other party’s normal legal cost, the uplift of the successful party lawyer’s fee and in any other case where he litigation has insured against facing an order for the other side’s cost, any premium paid by the successful party for that insurance. The intention was to:

a) Ensure that compensation awarded to successful party is not eroded by an uplift or premium
b) Make conditional fee more attractive in particular to claimants seeking non-monetary reduction (because they cannot rely on damages to meet the cost of uplift premium
c) Discourage week cases and encourage settlement
d) Provide a mechanism for regulating the uplifts that solicitors charged. In future unsuccessful litigants will be able to challenge high uplifts when the courts come to access costs.

i) Conditional fees in civil litigation – Conditions fees or ‘no-win-no-fee’ arranged is a form of risk sharing. If lawyer loses the case, the client does not pay. If the case is won, the lawyer can be re-compensated through success fees, which is work out as a percentage of his costs. The maximum fee was set at 100% of the lawyer’s normal fee for the work undertaken. A lawyer is unlikely to take on a case that only has a low chance of being successful. Weaker case would not be funded. Conditional fees encourage lawyers to manager their work efficiently. They were first introduced by s.58 of the Court and Legal Services Act 1990. The range of cases covered was extended in 1995. It can now apply to proceedings involving personal injury, insolvency and cases before the European Commission and European Court of Human Rights. In 1995 the Law Society issued a code of guidance which suggested voluntary limit of 25% of any damages that could be taken as success fee.

ii) Legal Expenses Insurance - The law society also arranged a scheme of insurance for their client against meeting their opponents’ costs in personal injury cases. The two types of insurance under the scheme are Before the event Insurance (BEI) – General form of insurance against legal cost that may occur, often part of broader insurance policy or as stand alone. Compared to AEI, BEI is cheap and flexible and After the Event Insurance (AEI) - The insurance scheme covers the insured person against the risks of losing a court case. It works alongside conditional fee arrangement and provide cover if the insured person is unsuccessful in the litigation and has to pay the costs of the opposing party. The premium can be high and compared to BEI it is more complex to administer, there is also problem if the costs exceed the insured limit.

Conditional Fee And The Development Of The Common Law

Since the introduction of conditional fees, the common law has been developed in two decisions by the courts. In Thai Trading Co (A firm) v Taylor 1998 the Court of Appeal held that there was no longer public policy grounds to prevent lawyers agreeing to work for less than their normal fees in the event that they were unsuccessful provided that they do no seek to recover more than their normal fees if they were successful. In Bevan v Ashford (1998) the Court of Appeal held that it was also lawful for a conditional fee agreement to apply in a case which was to be resolved by arbitration (under Arbitration Act 1996) even though these are not court proceedings provided that all the requirements specified by the Regulation as the form and content were complied with.

Following the decision in Thai Trading Company s.8 of the Solicitor’s Practice Rule was amended in January 1999 to allow any arrangement already permitted under state or common law. However, the case was not settled. The CA in Geraghty v Award (2002) the agreement was held unenforceable as being both contrary to legislation and common law by following the decision of the House of Lords in Swam v The Law Society (1983) which held that the Practice Rule had the effect of statute. In Gallery v Gray (2002) the House of Lords expressed concerned that the CFA are opened to lawyers charging excess fees and using cases they won to offset the one’s lost and 20% was thought as permissible for such fee but in Halloran v Delaney (2006) 5% was thought appropriate figure. In English v Clipson (Peterborough County Court) unreported case (S&H p. …) the explanation by a non-solicitor was held as non-compliance with conditional fee rendered unenforceable. In Sharat v London Central Bus Co.) It was possible for a solicitor to delegate the explanation. In Worth v McKenna (Liverpool County Court) 2002 it was claimed that the CFA was a privileged document and the defendant was not entitled to see it.

CFA does not sit well with the indemnity principle of the English law and there is a strong view that the agreement should be disclosed during hearing and payment should be restricted to base fees by unsuccessful party and uplift and insurance premium from damages. Fixed fee is being considered with claim of £10,000 set as – fixed fee £800, 20% of damage for £0-5000; 15% for £5,000 upward; VAT and disbursable.


MIDDLETON REVIEW

Middleton review proposed a central body to become more active in the delivery of legal services. Lawyers and other providers will only be able to work under the scheme when they have a contract with or a grant from the Legal Services Commission (LSC) s.13.3.1. This was to eliminate the bureaucracy associated with case by case consideration. In addition, competition among legal firms for contract will engender better value and greater sensitivity to regional variations in price and demand. Contract could contain incentives to do certain kind of work, and to allow some of risk of litigation to be borne by the solicitor’s firms rather than their clients.

CRITICISMS OF CONDITIONAL FEES AND LEGAL EXPENSES INSURANCE

Legal Aid Group had pointed out problems with the lack of regulation of companies who manage the claims. Research suggests that the services of these intermediaries are relatively costly to clients and yet yield less in terms of settlement levels, even though they take on a relatively low-risk caseload. The main contribution of referral agent is one of which, they are able to advertise widely and encourage large number of claimants to enter Conditional Fee Arrangements (CFAs). LAG also argued that the insurance companies are driven by profit, rather than interest of their clients. The failure of two insurance companies (Claim Direct and The Accident Group) suggests there is need for government intervention.

Legal Expenses Insurance has been part of household insurance policy in Sweden since 1960s and the withdrawal of state funded aid was felt less acutely. Ninety seven percent of all household in Sweden have this form of insurance but disadvantaged groups do not. Opponents of legal insurance have been suggested that it encourages litigation rather than settlement. LSAG suggests that LEI might naturally overtake CFAs as the preferred means of funding for many civil claims in this jurisdiction,

As part of the process for continued reform of the funding of legal services the Access to Justice Act 1999 came into force. Some of the key features of the Acts include Community Legal Service – The Legal Service Commission (LSC) was created under Access to Justice Act 1999 to establish, maintain and develop a Community Legal Service (CLS launched 1 April, 2001) and Criminal Defence Service (CDS). Most publicly-funded CDSs will be by provided by lawyers in private practice under contracts. One advantages of the system is that it would eliminate fragmentation that characterises the old legal aid scheme. If the case does require the services of a specialist advocate in the Crown Court, this would be provided under a separate contract. CDS should be able to employ lawyers directly as salaried defenders. Evidence from other countries suggests that properly funded salaried defenders can be more cost-effective and provide a better service than lawyers in private practice. The government believes in the longer term, the best approach will prove to be a mixed system, combination of both private and staff lawyers. The cost of salaried services will provide a benchmark, which the CDS can use to assess whether the prices charged by private lawyers are reasonable. The funding code is the set of rules used to decide which individual cases are to be funded by the Legal Services Commission as part of the Community Legal Services. It replaces the ‘merit test’ for civil legal aid.

The levels of services available for funding civil litigation and advise include legal help, help at court, approved family help, legal representation, support funding, family mediation, Emergency representation, Licensed Work, Individual case contracts. While the level of services available under the criminal legal aids are advise and assistance, advocacy assistance and representation.

The levels of services available for funding civil litigation and advise include legal help, help at court, approved family help, legal representation, support funding, family mediation, Emergency representation, Licensed Work, Individual case contracts.` Court duty Solicitor Scheme and Police Station Advice and Assistance. Decision on funding is determined by the following key consideration prospects of success in five main categories namely very good, good, moderate, borderline and unclear.

CRIMINAL CONTRACTS
There has been misgivings that the new contract will mean that there are simply not enough criminal defence lawyers, quality control and standards and adequate supervision by a new body. The predominant model remained that of lawyers in private practice are general reluctance to move towards the model of salary providers of legal services. Recruitment and training of new case workers is an expensive business and under-capitalised legal aid firms operating on small margins find it difficult to expand, even when they know the demand is there. Experiments such as law centres remained largely peripheral

In Canadian province of Nova Scotia, legal services are provided by staff lawyers working from legal aid offices

Mackay argues that present structure of legal services effectively limits the real possibilities of reform. The model of provision from private firms is likely to retain its hold and it is hard to see how this could be transformed. Salaried services can be deployed in ways that private practice cannot. It could have effect in social welfare and not-for-profit sectors. Charities and advice agencies can become providers of legal services

PLANNING

Community Legal Services Partnerships (CLSP) begun in April 2000 aimed at allowing grassroots inputs into planning and provision of legal services. CLSP bring together local authorities, charities, local lawyers and advice groups, identify legal needs at local level and communicate this to the Regional Legal Services Committees. The commission activities are expensive. It is estimated that the planning initiatives cost £2.8 million. It is also problematic that there is no independent body to assess the activities of the commission.

STANDARDS

The whole trust of LSC’s approach to quality is based on management system. The franchise, and now contract standard, Legal Aid Franchise Quality Standard (LAFQAS) is based on the industry model of Total Quality Management. LAFQAS approach has brought some welcome improvements in the running of firms and a change in the management culture of legal practices, its shortcoming are becoming increasingly apparent (Mackay 2001).

CRITICISMS

LAFQAS are limited because they cannot be used to assess whether correct advice was given or the correct legal strategy pursued. This can be evidenced from the fact that certain immigration firms were awarded contract, but showed they are incapable of doing the work to the correct standard. Critics are of the view that LSC should not be in the position where it assess quality and award contracts. This is to avoid potential conflicts of interest between the two roles. There is a strong argument for the development of an independent legal aid inspectorate to oversee to encourage the development of quality standards for legal work, oversee the administration of legal aid and monitor access to justice.

LEGAL AID, COSTS AND ACCESS TO JUSTICE A HUMAN RIGHT

The enactment and operation of Human Rights Act 1999 has implications on the operation of the legal aid system. Articles 5 and 6(1) affirm a right of access to courts, but this right can be qualified by the state. Civil rights mean the private right of citizens. Some cases have been considered by the European Courts of Human Rights (ECtHR) which has effect on the provision of legal aid to citizens. Some of these cases are Airey v Ireland (1979) 2 ECtHR 305. The court distinguished between criminal and civil case. In civil case, there was not a full right to legal aid as there was in the criminal area. In Murno v UK No. 10594/83, 52 DR 158 (1987) the court qualified legal aid for civil cases, effective access to the courts, where defamation did not carry an entitlement to legal aid. In Winer v UK No, 11564/85 45DR 158 (1987) it was held legitimate to exclude certain categories of legal proceedings altogether from legal aid by reference to financial criteria and inherent riskiness. In Osman (1998) r, BHRRC 294 it was suggested that there would have been a breach of Article 6 had legal aid not be awarded. Fayed v UK (1994) 1 18EHRR 393 suggested that it would be legitimate to refuse legal aid where there are limited resources. Zamir v UK (1983) 40 DR 42 establishes right to legal assistance when the party has insufficient means. An illegal immigrant facing deportation

The Co-Ordination Of Agencies

To improve the delivery of the legal aid there is need for to think creatively about a complex issue such as coordinated field of assistance and representation by participants in the scheme. Because of the decrease in provision of services some people do not have choice. The number of solicitors’ firm providing specialist services has dropped, but this is offset by a rise of service providers in the not-for-profit sector which now account for 80% of total supplier base. These bodies concentrate on providing services in certain areas to the detriment of other, where there is a shortfall in the provision of representation in court

The Role Of Not-For-Profit Sector And Alternative Methods Of Funding

LAG raised the points that it is not necessary that the case that all legal service have to be funded by LSC. It also drew attention to local advice centres and bodies that have been drawing fund from local authorities and charitable trusts. The policy objectives of setting up a comprehensive network of Community Legal Service Partnership (CLSPs).

How to Achieve Savings In The Legal Aid Budget

One possibility is the creation of separate Criminal Defence Fund. This would involve compulsory contribution from the financial sector and utilised in cases where people from that sector come into contact with the criminal courts. It is the high cost criminal cases which are so demanding of financial resources. In addition, Not-for-profit sector can offer something to the provision of legal services. Law Centres could interface with Advice Centres to cover those areas of social welfare aw that are being excluded from the advise portfolios of solicitors firms.

Moving away from reliance on private practice should be accompanied by a programme for the expansion of law centres and not-for-profit services. Legal aid firms should make use of government proposal to set up community interest companies (CISs) – new companies designed for social enterprises that want to use their profit and assets for public good. LAG was also of the view that control could be provided by peer review rather than intrusive and expensive bureaucracy

In 2005, Lord Falconer asked Lord Carter of Coles to review the legal aid. Lord Carter recommended phased transition to a vibrant, good quality and effective market nationwide by 2009. Three phases of the reform are:

a) Fixing prices for all criminal legal aid work
b) A managed market, awarding contract to efficient and good quality supplier
c) Managed price competition between efficient and good quality suppliers with safeguard to protect standards of quality, coverage in rural areas and diversity.

There were complaints in 2005 over payment for criminal legal aid work, with threats of lawyers withdrawing their services. Lord Wolf was of the view that government had to device reasonable but not ‘excessive rewards’ for both barristers and solicitors. He urged the Lord Chancellor to seek extra fund to remedy the parlous state of the court and that the myth that civil courts could be self-sustaining was totally inconsistent with the equal justice for all.

Making legal education available to more people is another way providing access to justice to a greater number. If more people are knowledgeable on law as its affect them, it would be easier for them to access justice whenever the need arises. This could be achieve by making legal education on the areas that affect lives of most individual available to students in school and at same time providing access to flexible legal education to adults through the traditional classroom method, part-time programme, seminars and online trainings. More people could be reached through a combination of these methods. The objective should be to create a situation where more people will be able to process simple legal issues on their own, where complex issues arise; they will be in a better position to take a decision on how to obtain the best service at the least cost. It is high time we all combine effort to destroy ‘societal fear’ of law that is out there. This suggestion may sound outrageous to some lawyers, but I am of the opinion that creating such an environment will make the jobs of the lawyers easier, be of benefit to vast majority of people and the society will be better it. I am of the view that the solution lies not in one direction but a combination of options.