Privatised courts – where to, where from?

sold

The Times, May 28 scooped the story. If not subscribed to The Times Online, the reader should turn to Ben Bryant of the Telegraph to pick up the storyline, and Owen Bowcott of the Guardian who digs deeper into the Ministry of Justice denials.

The story turns on possible saving to the Ministry of Justice of £1 billion per year from the ‘wholesale privatisation’ of the courts, freeing them from Treasury control. Private investment and means-tested payments would relieve the taxpayer of a long standing burden.

Sarah Vine of the Guardian also enters the fray, fingering the velum of the fourteenth century Magna Carta, and concluding, “If Grayling has his way, the only heads left above the corporate water will be the judges”.

Whilst the media focus is understandably on the prospect of corporation such as G4S running the court service – and in time perhaps even employing the judges – this blogger is more interested in the imminence of something more subtle.

The state has never run a monopoly on the provision of justice, only – until fairly recently – on the appointment of judges. Their offices would historically follow revenue, and would be granted to those who supported the monarch.  Sixteenth century barrister Matthew Shardlake, in CJ Sansom’s ‘Heartstone‘, gives a graphic description of the judges of the ‘Court of Wards and Augmentations’. These were the courts that dealt with wardship (our modern day Family Courts).  After the Dissolution of the Monasteries and the seizure and selling of monastic lands, the old ‘Office of Wards’ was abolished and replaced by the Wardship court. These checked the value of lands subject to wardship, and the feodaries negotiated with applicants for the wardship, and land, of minor heirs. Some were granted to the children’s families, but where substantial money was involved, others would be awarded to the highest bidders.  “Wards and Augmentations are still sitting”…the courts that brought revenue to the King… would sit all summer”, observed Shardlake.

Justice has always been the younger brother of money, whether in the hands of the client, the lawyer or the state.

The blogger senses that the issue that most concerns government is not the running of courts, but the sheer scale and cost of public justice.

Hiving off the court buildings and administration to the private sector could undoubtedly result in savings – you only have to look at prisons to see this. It could also result in a better service deal for court users. How often as clients or advocates have we wasted hours, or even days, in waiting ‘our turn’ in the overstretched court list before a judge who is expected to react to information given to him or her on the morning of trial? The private sector could not get it more wrong.

The real point of reform is that the public in fact ends up underwriting the cost of everyone’s disputes, no matter how unreasonable. The court ‘issue fee’ no way reflects the cost of running the court and paying for the judges. For genuine civic disputes, this is a bearable social cost. But for private disputes, arguments concerning spousal assets, and company and commercial disputes, the subsidy by the public is unacceptable.

Recently retired Lord Justice Sir Alan Ward summed the problem up perfectly in a noisy floor dispute, “Not all neighbours are from hell. They may simply occupy the land of bigotry. There may be no escape from hell but the boundaries of bigotry can with tact be changed by the cutting edge of reasonableness skilfully applied by a trained mediator. Give and take is often better than all or nothing”.

As other systems are available, why should the taxpayer fund the big-money divorce,  the bankers’ dispute or the noisy floor? Yes, the litigation costs of these cases are enormous, but solely to pay the lawyers bills rather than the judges’ salaries and the public cost of running a court.

The government’s agenda is to shed as much work from the state court system as possible. These days, courts clearly do not pay.

There is, of course, the minor problem of Article 6 European Convention of Human Rights, providing “in the determination of his civil rights and obligations or of any criminal charge against him, everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law”. Perhaps this too is an underlying reason why some politicians are keen for repeal.

So, the blogger will forecast the next steps.

Commercial, company and most civil disputes will be directed towards arbitration, mediation and expert determination at first instance. These processes will be the ‘gate keepers’ for entry to the courts. The ‘reasonable time’ for determination of a dispute will run from the point where the alternative resolution mechanisms have been exhausted.

Likewise, family disputes involving children and money will be referred to alternative dispute resolution – where most will be expected to be solved. Only then, and on sanction of costs, will the courts intervene. The Family Court experiment with public law cases will flounder in delays exceeding 26 weeks and be replaced by tribunals.

Criminal cases will be handled by increasing use of community resolution processes, such as self-referral, the acceptance of voluntary penalties and restorative justice, offenders knowing that these will deliver the best deals. Only the hardened criminal for whom prison is inevitable will the door to the dock opened.

Of course we will still pay for the judges, but a slimmed down bench, with reduced pensions, and the small accompanying coterie of cut price lawyers will be cheap in comparison.

Perhaps Justice Secretary Chris Grayling has a point…..?

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Cost of barrister regulation soars

By Neil Rose of Legal Futures

 

The Bar Standards Board (BSB) is already projecting a £161,000 overspend on its 2013-14 budget, which itself is £1.2m (or 30%) higher than the previous 12 months, Legal Futures can report.

The BSB’s financial year only began on 1 April but the recent meeting of its main board heard that a lack of budgeted resource for education projects – and in particular the Bar course aptitude test – is responsible for around 60% of the forecast overspend.

The BSB and Bar Council agreed the higher budget for this financial year after regulation ate up £460,000 of the Bar Council’s reserves in 2012-13.

The £1.2m increase is mainly because of “the pressure of implementing the regulatory standards framework”, according to the BSB’s business plan, which was published last month.

The framework is laid down by the Legal Services Board (LSB) and has four key pillars: outcomes-focused regulation, risk assessment, supervision and enforcement. Each regulator has to show sufficient capacity and capability to regulate in those key areas. The LSB’s assessment of how the BSB is currently performing against these is due to be published shortly.

The increase will be offset in part by an expected rise in non-practising certificate fee income of £432,000 to £1.8m. It appears that the Quality Assurance Scheme for Advocates accounts for this. The BSB is expecting income of £452,000 for initial accreditation applications, and a further £35,000 from barristers progressing up the levels.

The two main heads of the BSB’s expenditure are governance/management (£1.6m) and disciplinary/enforcement activities (£1.4m).

When premises costs of £678,000 and shared services of £2.1m are taken into account, the total cost of regulation for barristers is £8.2m. The LSB is to launch a major investigation into the cost of regulation across the legal profession.

Meanwhile, Alistair MacDonald QC has been named the vice-chairman-elect of the Bar Council following a contested election. He will take up the post on 1 January 2014 with a view to becoming chairman a year later.

Mr MacDonald is co-head of New Park Chambers in Leeds, which has just lost a bid to take on an ex-chief constable as a pupil without paying her. His practice is now principally in crime although he used to do a broad spread of work including personal injury and administrative law. He is the leader of the North-Eastern Circuit and has sat as a Recorder in crime and civil since 1995.

Nicholas Lavender QC, who practises commercial law from Serle Court Chambers, will be the 2014 chairman.

Also, the Bar Council has finally appointed a new chief executive, two years after David Hobart left to take up the same role at the City of London Law Society.

Stephen Crowne, who will take up the post next Monday, was most recently as senior director, global education at IT company Cisco. Formerly a senior civil servant, before Cisco he was chief executive of the British Educational Technology & Communications Agency, the government agency charged with promoting technology in learning.

The appointment panel included representatives from the Bar Council and Bar Standards Board.

 

Why I have a problem with the Family Law Bar Association

Man Hanging on a Scale While Another Man Fills Dish

The ‘May fees update’ from the Family Law Bar Association has now hit our email boxes.

The FLBA warns us in no uncertain terms to take heed of the proposed changes for public funding in criminal cases set out in the government paper ‘Transforming Legal Aid: delivering a more credible and efficient system‘ , and to see this as a “far reaching” proposal that may go on to deny ‘the most vulnerable members of our society access to specialist legal advice’.

Clive Baker, in his detailed response to the government paper links back to the effect of the Legal Aid Sentencing and Punishment of Offenders Act 2012 (LASPO). There  he cites a cut of £350m per year affecting 600,000 people. He suggests that  LASPOA was the start of ‘work in progress’ to trim the legal aid budget for family work rather than the end of the matter.

So, has the FLBA got it right. Is Armageddon just round the corner for both the legal profession and the public they serve?

Chris Grayling, Lord Chancellor and Secretary of State for Justice subscribes to a simple view concerning the funding of criminal cases,

“Over the past decade, the system has lost much of its credibility with the public. Taxpayers’ money has been used to pay for frivolous claims, to foot the legal bills of wealthy criminals, and to cover cases which run on and on racking up large fees for a small number of lawyers, far in excess of what senior public servants are paid. Under the previous government, the cost of the system spiralled out of control, and it became one of the most costly in the world”.

The blogger has memories that exceed the ‘past decade’ and is tempted to say that since public funding has been available ‘it has always been thus’. Indeed, the blogger’s favourite legal friend Matthew Shardlake interfaced with the same frivolous claims, wealthy criminals and exploitative lawyers in the 16th century. It could be said that ‘where there are lawyers, there will always be conflict’.

The doomsday practitioners gather sustenance from Lord Justice Ward in Wright v Michael Wright Supplies Ltd [2013] EWCA Civ 23416, who at para 2 addresses one of the consequences of withdrawing public funded legal advice:

“What I find so depressing is that the case highlights the difficulties increasingly encountered by the judiciary at all levels when dealing with litigants in person. …. how to bring order to the chaos which litigants in person invariably – and wholly understandably – manage to create in putting forward their claims and defences. Judges should not have to micro-manage cases, coaxing and cajoling the parties to focus on the issues that need to be resolved”. ” It may be saving the Legal Services Commission which no longer offers legal aid for this kind of litigation but saving expenditure in one public department in this instance simply increases it in the courts. The expense of three judges of the Court of Appeal dealing with this kind of appeal is enormous. …. The appeal would certainly never have occurred if the litigants had been represented. With more and more self-represented litigants, this problem is not going to go away. We may have to accept that we live in austere times, but as I come to the end of eighteen years service in this court, I shall not refrain from expressing my conviction that justice will be ill served indeed by this emasculation of legal aid.”

But an essential question is not whether the court is able to cope with litigants in person, but whether the system should direct them there as the most appropriate venue to resolve their dispute?

Blog readers by now will know of my views on the importance of mediation and private arbitration. You will also have read of my views about the relevance of an adversarial process in family disputes, and questioning the need for parents in conflict to have ‘party status‘.

Has Lord Justice Ward missed the point as he reaches his 18th year aboard the Court of Appeal? Is it necessary, or even advisable to have lawyers directing proceedings from the beginning of a dispute to its end? And should the public carry the bill?

Should he not reflect back on Lord Woolf’s comments in Cowl v Plymouth (2001) EWCA 1935 at para 25:

Without the need for the vast costs which must have been incurred in this case already being incurred, the parties should have been able to come to a sensible conclusion as to how to dispose the issues which divided them. If they could not do this without help, then an independent mediator should have been recruited to assist. That would have been a far cheaper course to adopt. Today sufficient should be known about ADR to make the failure to adopt it, in particular when public money is involved, indefensible”.

There is something singularly unattractive about a profession as well paid as ours, raising principled arguments concerning the withdrawal of our publicly funded income.

Whilst the points are well made, surely the art now is to raise them subtly, record them, and work positively and creatively with a popular, democratic idea. Should it fail, of course we will be there to pick up the pieces.

Stobart Barristers

Eddie Stobart

Eddie Stobart subsiduary, Stobart Barristers has entered the legal ring to provide direct public access in criminal cases.

‘Stobart Barristers’ was formed last year charging fixed fees and using paralegals to instruct their team of barristers.

Stobart’s legal director Trevor Howarth said,

“We can deliver the service at a cost that’s palatable for the taxpayer, our business model was developed with this in mind”

“We …are well known for taking out the waste, and the waste here is the duplication of solicitors going to the courtroom. At the moment there are 1,600 legal aid firms; in future there will be 400. At Stobart, we wouldn’t use 10 trucks to deliver one product.”

Trevor Howarth has developed some insight into the legal process. He is shortly to face trial for contempt of court , although it has to be said that the background to the allegations is decidedly murky. But, no doubt it places him in an informed position to comment on the provision of legal services.

howarth

In my previous blog ‘The Price is Right we looked at the impact of third party investors moving into the legal market place. There, holding company LawVest introduced their Riverview concept, causing both consternation and interest amongst legal professionals. Other recent entrants include Parabis.

The Bar Council, spearheaded by current Chair Maura McGowan, has launched its 38 degrees petition to oppose the move to competitive tendering for publicly funded criminal defence contracts.

Whilst understanding the potential for problems, the blogger does not share the Bar Council’s calamity vision.

We are, after all, dealing with public money, a finite resource. A proper legal service for the defence of criminal charges is essential, but not at unsustainable cost. The proliferation of criminal defence practices during the blogger’s career has not added to the quality of representation, as neither has the higher rights of audience for solicitors improved the legal landscape.

Is the time not right for those who spend public money being more accountable for the costs?

With direct public access to an expert barrister, should the Bar not be focussing its attention on obtaining and managing public funded contracts, rather than supporting the disparate high street solicitors practices of the past?

Closed doors in public courts

pack of cards

In my last posting ‘£25 m mediation budget following the death of legal aid‘, I mentioned the case of W v M (2012)EWHC 1679 (Fam), with the forward thinking judgment from Mostyn J.

It was only after writing, that it occurred to the blogger that Sir Nicholas Mostyn‘s judgment could hold the key for a dramatic development for future legal services in England and Wales.

When an established and credible ‘private process of dispute resolution’ is available through mediation and private arbitration, why should our system of public justice ever work behind closed doors?

Perhaps now is the time for the former Presidents of the Family Division Mr Justice Potter’s 2008/9 vision and Sir Nicholas Wall’s endorsement, to become a reality? Maybe now parliament should be preparing to update the House of Commons Standard Library note?

Nicholas  Mostyn is not a stranger to this line of thinking. In M vM & London Borough of Sutton he lifted the injunction on the Sunday Telegraph columnist from reporting proceedings.

The current President, Lord Justice Munby is on record with even more radical views,

“Both principle and pragmatism demand that we open the family courts, that we drastically relax the present access restrictions.

“But affording access to the family courts is not alone enough. The answer, if I may be permitted to adopt the former Lord Chancellor’s language, is that we need both more people going into the family courts and more information coming out. Each of these is essential; neither alone is sufficient.”

“I am not talking merely about judgments which are thought to be reportable because of their perceived legal interest. Releasing for publication only those judgments which are ‘reportable’ means that the public obtains a seriously skewed impression of the system. What one might call ‘routine’ judgments in ‘ordinary’ care cases and private law cases should surely also be published – all of them, unless, in the particular case, there is good reason not to. The second point leads on from the first. It is not only High Court judgments that should be published in this way. Why should not County Court judgments also be published?”

More recently, on 22 February 2013 at the Family Law Bar Association dinner he said,

” I am determined to take steps to improve access to and reporting of family proceedings. I am determined that the new Family Court should not be saddled, as the family courts are at present, with the charge that we are a system of secret and unaccountable justice. Work, commenced by my predecessor, is well underway. I hope to be in a position to make important announcements in the near future”.

And today, we have new practice guidance in relation to public access to committals for contempt of court.

In W v M Sir Nicholas Mostyn said,

“Where parties are agreed that their case should be afforded total privacy there is a very simple solution: they sign an arbitration agreement. Arbitration has long been available in proceedings such as these. Recently arbitration has also become available in financial remedy proceedings by virtue of the much-to-be-welcomed scheme promoted by the Institute of Family Law Arbitrators. In those proceedings also privacy can now be guaranteed”.

Does Sir Nicholas’ obiter sound the rallying call for imminent change?

‘For private proceedings, choose a private process. If you come to public courts, increasingly expect justice that is open to public scrutiny’.

£25M mediation budget following the death of legal aid

lord mcnally

Lord McNally, Family Justice Minister

April 1 2013 saw the inception of the Legal Aid, Sentencing and Punishment of Offenders Act 2012, one of the most far reaching legal provisions in a generation.

Some commentators see the change in the legal aid rules as a disaster.

Since April, your blogger, wearing his hat as barrister and advocate, attends court to face increasing numbers of litigants in person – and cases out of control. For the judges it is more stressful. They have the immensely difficult job of case management with parties that fail to understand the rules and question the reasons for them.

And of course, there are those who cannot contemplate representing themselves and simply feel shut out of their legal remedies. The courts were not ready for this. There is some help from the Bar Council’s guide, and more from Lucy Reed‘s Family Courts Without a Lawyer publication. But almost certainly, this will not be enough to avoid degrees of chaos.

The Ministry of Justice has however allocated £25 million (an increase of £15m) to support family mediation. Lord McNally, Family Justice Minister expects mediation assessment meetings to provide the answer – providing important information about facilitation and allowing parties access to mediation services. McNally contends that, with mediation, the average time to resolve property and financial remedy disputes drops from 435 days to 110 days, together with the accompanying reduction of cost and stress to the parties.

Leading up to, and since 1 April, new mediation services (such as the pilot at Teesside Combined Court Centre) and the blogger’s service ‘Divorce Without Pain‘ have sprung up to deal with the increase in need for mediation. It is too early to tell whether these schemes will flourish, and indeed whether parties to a dispute will favour specialist lawyer mediators.

Arbitration has likewise come to the fore as a method of dealing with property and financial remedy disputes. For several years these methods have been tested in Ontario, Canada and Australia – and introduced two years ago in Scotland through its Family Law Arbitration Group Scotland. Vancouver arbitrator Georgialee Lang, speaks of the “disharmony, conflict, lengthy delays and outrageous legal fees.” arising from the current court systems for family law – and describes courts as “the worst place for couples to resolve their divorce issues”.

The English Family Law Arbitration Scheme set up by the Institute of Family Law Arbitrators is now celebrating its first anniversary, and reports steady progress, with numbers of trained arbitrators reaching double figures. It is still unclear how the courts will enforce the arbitration awards, although the Arbitration Act 1996 is susceptible for the purpose.

The courts too appear to favour the advent of arbitration in such disputes. Although W v M (2012) EWHC 1679 (Fam) relates to a Trusts of Land and Appointment of Trustees Act 1996 dispute, Mostyn J at para 70 said “Where parties are agreed that their case should be afforded total privacy there is a very simple solution: they sign an arbitration agreement. Arbitration has long been available in proceedings such as these. Recently arbitration has also become available in financial remedy proceedings by virtue of the much-to-be-welcomed scheme promoted by the Institute of Family Law Arbitrators. In those proceedings also privacy can now be guaranteed”.

In T v T (2012) EWHC 3462 (Fam) Nicholas Francis QC concluded that where a married couple had entered into a premarital agreement with an arbitration clause, the English court would not restrain the husband from seeking to enforce arbitration in the USA.

Cases such as W v M and T v T set the trend. Now what is needed is the culture change. It will be when parties to a dispute think ‘mediation’ or ‘arbitration’ as the first call, that we will see the proper rise of private dispute resolution rather than reliance on the courts and the lawyers that fan the flames.