On 1 May 2018, in an important development for future litigation in Scotland, the Scottish Parliament passed the Civil Litigation (Expenses and Group Proceedings) (Scotland) Bill. Its provisions will be brought into force by the Scottish Government following Royal Assent. The Scottish Government’s present intention is for phased implementation from Summer 2018, such that different provisions may be brought into force at different times.
We summarise, here, the main provisions of the Bill:
Damages Based Agreements (“DBAs”)
Solicitors, advocates and claims management companies in Scotland will be able to enter into agreements with their clients to take a share of any damages awarded. Secondary legislation is anticipated to set a percentage scale of the maximum amount which may be taken in this regard. Future pecuniary losses are not ring-fenced from this, despite the earlier recommendations of the Scottish Parliament’s Justice Committee.
Qualified One-Way Cost Shifting (“QOCS”)
A successful defender in a personal injury claim will not be able to recover costs from an unsuccessful pursuer unless that pursuer or his or her legal representative:
- makes a fraudulent representation or otherwise acts fraudulently in connection with the claim or the proceedings (proof on the balance of probabilities)
- behaves in a manner which is manifestly unreasonable in connection with the claim or the proceedings; or
- otherwise conducts the proceedings in a manner that the court considers amounts to an abuse of process
For the first time in Scotland, group proceedings, or multi-party actions, are to be allowed at the Court of Session, with the permission of that Court and subject to certain inquiries being undertaken.
As soon as practicable after a period of five years, the operation of the Act is to be reviewed and reports laid before the Scottish Parliament.
Secondary legislation and Rules of Court
Secondary legislation and Rules of Court are anticipated to deal with the practical operation of certain aspects of the Act, notably the interaction of QOCS with tenders (defenders’ judicial offers) and, separately, abandonment of a case by a pursuer, which aspects are presently being considered at committee level of the Scottish Civil Justice Council. Indeed, it should be borne in mind that the Scottish Civil Justice Council is charged generally, since its establishment on 28 May 2013, with keeping the Scottish civil justice system under review and preparing and submitting draft rules to the Lord President, as the head of Scotland’s judiciary.
Some similarities with 2013 Jackson reforms but with certain significant differences in detail
Certain of the expenses, or costs, reforms which are being introduced in Scotland bear some superficial similarity to the Jackson reforms in 2013 for England and Wales. There are, though, certain significant differences in detail such that expert legal advice from a practitioner qualified in the relevant jurisdiction is always recommended. A link to the Bill as now passed is here.
Frank Hughes, Partner