Costs in defamation and privacy proceedings

MoJ consultation open until 8 November 2013

The Ministry of Justice has produced its consultation paper on costs in defamation and privacy claims. It is looking for practitioners’ views on proposed changes to the costs regime following the impending changes to CFAs and ATE insurance provision being implemented by the Legal Aid, Sentencing and Punishment of Offenders Act 2012 (LASPO). The key changes are the removal of the ability to recover ATE insurance premiums and success fees from the losing party.

The proposals for defamation and privacy claims draw on the Qualified One Way Costs Shifting system, which is currently used in personal injury claims as a means of protecting claimants from adverse costs orders.

The proposed changes to defamation and privacy claims are intended to ensure potential worthy claimants and defendants are not unduly dissuaded from bringing or defending proceedings due to the risk of having to pay the other side’s costs (especially if those are likely to be substantial).

They contemplate the imposition of ‘costs protection’ on request for both claimants and defendants. The level of costs protection available to a party would be determined by their financial circumstances, and would be lost by a party if they were found to have been fundamentally dishonest or where the case was struck out.

It would be open to the parties to agree on costs protection at the outset of a claim, otherwise the issue will be decided by a judge, based on a statement of assets of the applicant.

Views are sought on a new set of draft Civil Procedure rules to implement the regime.

The MoJ’s consultation document was produced following the publication of the Civil Justice Council’s Working Group report on costs in defamation actions. The group consisted of a range of specialist legal practitioners and judges in the field, including 5RB’s Desmond Browne QC and Chloe Strong. Click here to see the report.