Source: Lawyer Monthly
Jonathan White, Legal & Compliance Director at National Accident Helpline, offers his thoughts.
Incentives matter enormously. To Economist Steven Levitt, incentives were bullets, or keys; often tiny objects, but ones with astonishing power to change a situation.
A new fixed costs regime is set to be implemented from 1 October 2023, which will see the incentives for many lawyers change – and in many cases be completely reversed.
These changes are quite technical, but they represent the biggest change to civil justice for more than a decade. They will also provide a fascinating case study into how incentives govern how lawyers work.
What Are the Fixed Costs Reforms?
In summary, these changes will apply to the vast majority of disputes worth up to £100,000 in England and Wales. This includes personal injury, debt collection and any form of dispute involving money, whether between businesses or individuals.
The usual rule in litigation is that the loser pays the winner’s costs. Outside of personal injury (where legal costs have been fixed for claims under £25,000 for a decade), the winning side’s legal costs are usually calculated on the basis of time spent multiplied by an hourly rate…
Read full article: https://www.lawyer-monthly.com/2023/07/why-the-fixed-costs-reforms-will-spark-a-legal-sector-ai-explosion/
