MPs block moves to cap libel lawyers' success fees

Moves to cap the sums lawyers can charge in ‘no win, no fee’ defamation cases look set to be abandoned in the rush by Parliamentary to conclude its business before it is dissolved next week.

The Ministry of Justice announced last month that lawyers will only be entitled to a maximum of 10% cap of the damages awarded to plaintiff. Currently, lawyers can apply to double their fees if they win a case. Lawyers have warned that the market for after the event insurance in libel cases will collapse if fees are capped because it will be too risky to take on such cases.

But according to media reports, the regulations have been blocked by the scrutiny committee of MPs overseeing the Damages-Based Agreements Regulations 2010, who refused to refer it to the House of Commons last week. Under Parliamentary rules, all business must be concluded before a general election, triggering intense negotiation around the legislation that will be passed or abandoned.

The MPs are concerned that the bill will stack the odds against plaintiffs and in favour of defendants.