Costs News

11 March 2020
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Major report calls to extend QOCS to housing disrepair litigation

The Ministry of Justice (MoJ) should consult on introducing qualified one-way costs shifting (QOCS) to housing disrepair claims, campaign group JUSTICE has recommended.

Its report on solving housing disputes said tenant lawyers “expressed frustration at the frequency with which costs arrangements for disrepair claims have been changed”.

There is limited legal aid, with most disrepair cases handled under conditional fee agreements, although the MoJ’s consultation on extending fixed costs last year included disrepair claims.

The report said: “All of this is creating great uncertainty and challenges the viability of practices carrying out disrepair claims for tenants. Our working party thinks one way to provide certainty is to introduce QOCS to disrepair claims…

“District judges on our working party expressed the view that, in the overwhelming majority of disrepair cases which come before them, a claimant is successful. (Their concern was about the cases which they suspect are not reaching them, on account of difficulties accessing advice and the courts faced by people with meritorious disrepair claims).

“QOCS has the potential to be a powerful tool for access to justice in disrepair claims, though its introduction might require a robust early triage stage by judges or suitably qualified court staff, to assess unmeritorious claims.”

JUSTICE found that “costs implications can also act as a fetter on access to justice and the viability of the legal aid sector”.

It highlighted how the Jackson report considered the issue that arises when landlords settle with no order as to costs and how, in certain circumstances, landlords could exploit a conflict of interest between tenant and solicitor where the settlement is in the interests of the client, but the legally aided solicitor is not remunerated for the work they have done.

“Sir Rupert accepted that this created difficulties for solicitors, who were already operating in a harsh financial environment. The Housing Law Practitioners Association suggested that, in those circumstances, the county court could deal with the issue of costs on the papers (in the same way that the Administrative Court does), which Sir Rupert agreed was a sensible proposal meriting consultation.

“Notwithstanding, as far as our working party is aware, this consultation never took place. We recommend that the Ministry of Justice should consult on whether a publicly funded party should have the right to make a freestanding application for costs where the dispute has settled in their favour, in accordance with the Jackson report recommendation.”

The working party recommended as well that the MoJ “urgently address the need for sustainable funding for the legal aid and advice sector”.

It said tenant lawyers argued that the current funding model for legal aid practices and the advice sector has damaged the sector. “Legal funding for help delivered prior to court is not funded at a sustainable rate and many law centres rely on costs orders in successful housing cases to survive…

“Fundamentally, access to justice problems in housing disputes are in large part attributable to the collapse of the advice sector brought by LASPO. People simply cannot access legal advice and assistance for housing disputes or the underlying problems, such as benefits, that catalyse into housing issues…

“Piloting holistic interventions [as the MoJ suggested in its legal support action plan, published last year] is encouraging, but it is a small concession. What is needed is wide-scale investment in early interventions for people’s legal problems.

“In particular, there is an urgent need for the MoJ to reintroduce publicly funded legal services into advice deserts and to ensure that funding allows providers to address ‘clustered’ legal problems.”

In addition to these ‘fixes’, the JUSTICE report put forward a long-term model for a new comprehensive housing disputes service (HDS) to break with the past and streamline access to dispute resolution outside of the traditional courts and tribunals system.

“It would fuse elements of problem-solving, investigative, holistic and mediative models utilised elsewhere in the justice system,” it said. “The proposal offers a new approach premised not just on dealing with individual disputes, but rather on remedying underlying issues that give rise to housing claims and sustaining tenant-landlord relationships beyond the life of the dispute. We propose that should the HDS take off beyond a pilot phase, it would be a national service funded by subscription from housing providers.

The idea was opposed by tenant lawyers, JUSTICE acknowledged. “It is controversial and, for many, the solution to current problems is to remedy austerity-era policies. Nevertheless, the majority of the working party consider that the HDS could offer a better outcome for all parties to housing disputes than the current system and it is worth exploring – carefully, in limited scope, against relevant criteria and with advisory input from all relevant professional groups.”

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