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3 October, 2006  
Lawyers safely in charge of civil justice "reform"

The corporates had a victory on tort law reform. Now it’s payback time. Lawyers in Victoria look set to be the winners on the fees front after the law reform commission does another job on civil justice

imageIf you want to create bad law, my advice is to do it by way of “law reform”.

Through most of the 1990s Queensland’s solicitors had been suffering under a regime of salaried taxing officers, whose job included reviewing the bills of clients who complained.

For the period 1993-97 bills were being reduced, by taxing officers, by an average of 31.28 percent – see The Deregulation of Solicitor and Own Client Costs in Queensland (1998 3 NLR). Solicitors were quaking at the knees every time clients went trotting off to a taxing officer.

The correct response was not to introduce into Parliament a “Bill to abolish taxing officers” or a “Bill to give private lawyers the power to adjudicate complaints about excessive fees”, and that was not done.

Instead, those proposals were put into a Civil Justice Reform Bill. Consumers were left to argue that they didn’t want legal fees “reform”. What a hopeless position. It works every time.

imageVictorian Attorney General Rob Hulls (snap) has asked the Victorian Law Reform Commission to review Victoria’s civil justice system. A consultation paper has been issued. The deadline for public submissions is November 30, 2006. I very much doubt that the VLRC will ultimately come up with a draft “Bill to empty the deep pockets of corporate Australia”. Instead there will be “law reform” concerning fees.

Law reform bodies are run by lawyers. Their achievements are rarely appreciated. In 2005 South Australian Premier Mike Rann ruled out having a law reform commission for South Australia. He told parliament:

“A commission is code for taking the reform agenda away from the people and putting it in the hands of lawyers.”

The recent “tort reform” initiative was a rare exception to lawyer control of law reform. No law reform commission played an active part. Two members of the four member Ipp Review panel, that provided the basis for “tort reform”, weren’t lawyers. Corporate Australia, in the form of insurance companies, was actually in control. Plaintiff lawyer submissions were ignored by the NSW government, with Premier Bob Carr stating in parliament on May 28, 2002 that:

“The plaintiff lawyers will craft these cunning little amendments designed to reduce the bill’s effectiveness, to undercut it, to undermine it and to protect their own interests. We will not fall for that.”

The VLRC has assembled a dream team to tackle the review. They are all lawyers, who may well write something that the non-lawyer members of the Victorian legislature will fall for.

imageThe team comprises Dr Peter Cashman (pic) former president of the Australian Plaintiff Lawyers Association who will preside over the review, Justice David Harper from the Supreme Court, Judge Felicity Hampel from the County Court, Dr Iain Ross a partner at Corrs Chambers Westgarth (formerly VP of the Australian Industrial Relations Commission), and law prof Sam Ricketson.

The agenda for the review includes whether plaintiff lawyers themselves (and not just litigation funders) should be allowed to take a percentage of the winnings of their clients who have sued, for example, “deep pocket” corporates, and what to do about the tax deductibility of legal costs enjoyed by corporate litigants.

Some might suggest that the corporate cows are being lined up for milking, but I would refrain from such a crude characterisation of the situation.

Lawyers believe that it is impossible to improve the litigation process without increasing legal costs. In England the biggest civil justice reforms of the 19th century were the procedural reforms of 1873-75. Even today the Australian system of “pleading” in civil cases is modelled on them.

Nicholas Mullany QC has noted of those reforms that:

“The first result was to increase by 20 percent the ordinary expenses of a common law action.”

In the 20th century, the Woolf civil justice reforms, introduced in England in 1999, were described at that time by The Economist magazine as, “the most radical shake-up of the civil-justice system this century”.

Indeed, like the revolting Smallweed in Bleak House, the litigation system seems to ask with regularity, “shake me up”.

Back in 1996, when the Woolf reform process had commenced, The Economist noted that since Dickens published Bleak House in 1852 there had been: “60 official commissions or reports on reforming Britain’s civil justice system. They have had little impact.”

That includes little impact on reducing fees, although I would assume that all 60 terms of reference mentioned a need to reduce the cost of litigation. The VLRC reference does too. Very early on.

imageEdward Mann, a partner in the large UK law firm Reynolds Porter Chamberlain said in July this year that Lord Woolf’s (pic) reforms…

“have failed to reduce complexity and costs significantly because these goals were too ambitious in the first place. Reduction seems unlikely without a much more fundamental reform, such as moving away from the adversarial system in civil litigation.”

The only thing we ever need fear on the “law reform” front is attacks on adversarialism. The Australian Law Reform Commission was directed in 1995 to ascertain whether Australia would be better off with an inquisitorial rather than an adversarial civil justice system. Australia might well be better off but it would be a disaster for lawyers.

The ALRC rose to the needs of the occasion. The first step was to change the title of the review, from a “Review of the adversarial system of litigation” (the first directive having been to report on: ”(a) the advantages and disadvantages of the present adversarial system”) into a “Review of the federal civil justice system”.

By the time of its discussion paper in 1999 the ALRC was writing that it did…

“not advocate change to implement a non adversarial federal civil litigation system… The adversarial-non adversarial debate simply obscures effective reform.”

The ALRC’s actual report came out in January 2000, by which time the title had metamorphosed into “Managing Justice” and the original principal directive had more or less disappeared.

The new title was a stroke of genius. “Managing Justice” is legal mumbo jumbo for judges managing litigation. “Managing justice” is what inquisitorial judges do. In an adversarial system the lawyers manage the litigation, with judges supervising a bit. The implication was that adversarial judges “manage justice”, which is exactly what they do NOT do.

If Rann was right about law reform commissions then the message from the lawyers to the corporate world may well be: you got a win on tort reform, but no one beats us for long. We’re clever, and it’s payback time.


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