Success fees cap will 'destroy the after-the-event market'

Lawyers are warning justice secretary Jack Straw that his clampdown on success fees could destroy the market for after-the-event defamation insurance.

The claim is contained in a letter to the justice secretary from a group called Lawyers for Media Standards, in which it outlines its grounds for a judicial review of his department’s plans to clamp down on defamation success fees.

The Ministry of Justice announced last month that it had decided to impose a 10% cap on the maximum success fee that lawyers can claim. Currently, lawyers can apply to double their fees if they win a case.

The letter says: “This proposal would destroy the market for after-the-event insurance in defamation cases, thus pre-empting the decisions to be taken in response to the Jackson Report.”

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