Page last updated at 17:22 GMT, Tuesday, 24 February 2009

Plans to cut defamation costs

Ministry of Justice
Government plans would change the rules regarding libel costs

The cost of legal fees in defamation cases should be controlled, the government has announced.

The proposals for England and Wales follow claims that high fees are having an effect on freedom of expression.

Newspaper lawyers have said that some stories are simply ignored - to avoid the possible expense of a libel case.

Justice Minister Bridget Prentice expressed concern that people felt forced to settle out of court to avoid excessive costs.

Freedom of expression

"The aim of these proposals is to bring more effective cost control to litigation in defamation proceedings and to ensure that costs in this area are more proportionate and reasonable," she said.

"We need to ensure that people's right to freedom of expression is not infringed, and media organisations continue to report on matters of public concern."

The launch of the consultation paper on the plans came ahead of evidence being given by national newspapers' lawyers to the Commons Culture, Media and Sport Select Committee on the effects of libel fee costs.

Conditional fee agreements have provided access to justice for individuals attacked by the media
Bar Council

Media lawyers have previously complained of the "chilling" effect that these expenses are having in libel cases with regard to freedom of expression.

The government was particularly critical of no-win, no-fee conditional fee agreements (CFAs) which mean that claimants can sue media organisations without having to risk any of their own money.

Other issues being considered by the government are:

• limiting recoverable hourly rates by setting a maximum or fixed rate

• compulsory cost-capping or compulsory consideration of cost-capping in each case

• requiring the proportionality of total costs to be considered on cost assessments conducted by the court.

A spokesperson for the Bar Council, responding to the proposals, said that while they welcomed the suggestion that libel costs should never become too big so as to inhibit freedom of speech, they warned the limits should not go too far.

"Conditional fee agreements have provided access to justice for individuals attacked by the media. Such people could never sue before because there was no legal aid for defamation.

"Cost-capping is not a solution unless there is equality of arms on both sides. One possible solution is success fees staged according to the moment when the action settles.

"This would encourage the media to settle meritorious claims at an early stage"

CFAs are making defamation cases in England and Wales 140 times more expensive than in the rest of Europe, according to an Oxford University report commissioned by the publishers of the Daily Mail, Associated Newspapers.

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