Last week the Legal Services Commission announced the launch of a consultation on the replacement scheme for Very High Cost (Crime) Cases (VHCCs).

Chief Executive Carolyn Regan said: “The LSC is setting out a number of options for the most complex and expensive criminal cases that are designed to ensure clients continue to receive high quality legal advice. At the same time, it will also ensure litigators and advocates are fairly paid and are encouraged to work efficiently so that taxpayers receive value-for-money”. The new scheme is designed to replace the VHCC Panel scheme, established in January 2008, and the LSC makes no bones about the need to deliver savings.

For advocates, three options are proposed for consideration: to maintain the current panel system; an adaptation of the current hourly rate scheme but managed under individual case contracts; and extending the current Advocates’ Graduated Fee scheme, which is used in cases that last up to 40 days, to include cases that are expected to last up to 60 days. All cases that last 60 days or more would be paid at 2008 Panel rates. For litigators there are two options for consideration: to maintain the current panel scheme; and extending the current Litigators’ Graduated Fee scheme, on the same basis as the Advocates’ Graduated Fee scheme detailed above.

The Law Society has hit back at the plans to extend the Litigators Graduated Fee Scheme to VHCCs. Robert Heslett, Law Society President, said it was a barely-tested scheme and not a viable option. “The LGFS has not been in place long enough to have been properly evaluated. There have been numerous problems with it. It underpays for certain types of serious and sexual assault case, and for cases which are prepared for trial but then result in a guilty plea”. He pointed to the operational difficulties in validating the pages of prosecution evidence on which the payment calculation depends, adding that the scheme needs to be made to work for the cases for which it was designed before it can be extended to additional cases. “The scheme does not have any mechanism to take account of the work on unused material or the management required on very high cost cases. It depends on a ‘swings and roundabouts’ principle, but as most firms will only handle one or two VHCC cases per year, the sample is not large enough for the swings and roundabouts effect to function and firms will be subject to a greater risk of incurring substantial losses on these cases.”

The Law Society also said that an extended advocates graduated fee scheme raises many challenges. It may not be attractive to advocates without addressing some of the structural issues currently under discussion. This could mean that advocates are less likely to take on cases under the proposed system which could have serious implications for clients being able to obtain representation in long running trials.

The consultation closes on 26 January 2010 and all interested parties are encouraged to respond. The full text of the consultation document is at:

https://consult.legalservices.gov.uk/inovem/gf2.ti/f/184610/3234053.1/pdf/-/VHCC%202010%20%20A%20Consultation%20Paper%20%20Dec%202009.pdf

Very high cost cases (VHCCs) are those estimated to last more than 40 days at trial, or 25 days if involving complicated combinations of factors. Last year there were about 400 defendants funded by legal aid in 100 VHCC criminal cases at a total cost of £100 million. Defence teams are typically paid around £400,000 for such cases but costs in some, such as the Jubilee Line Fraud case, have run into several millions.

In an attempt to ensure best quality and value for the most expensive criminal legal aid cases, the Legal Services Commission established a very high cost cases (crime) panel due to run till July 2009. “We believe this panel offers real benefits to those signed up to it. They have the first opportunity to take on work worth in excess of £100m a year.” But, according to the ‘Guardian’, of the 2300 barristers invited to join only about 100 barristers and three QCs have so far signed up.

The sticking point would seem to be the capped fees offered. Under the new scheme, for preparation work a QC’s fees will range from £91 to £145 an hour, and for time spent in court a QC will get £476 a day. For a leading junior, the range is £79 to £127 an hour, with £390 a day for time spent in court. A junior acting alone will receive between £70 and £100 an hour, with £285 a day for time spent in court.

Peter Lodder, QC, senior criminal barrister and Chairman of the Criminal Bar Association, is reported in ‘The Times’ as condemning “these derisory levels of income…hourly rates do not encourage efficiency…a system geared to an efficient dispatch of justice should have an effective payment system.” At the heart of the dispute, he said, was the “driving down of fees to a level at which properly qualified people who have invested many years of training are simply not being properly remunerated”. As reported in the ‘Guardian’, he said that the full impact of the Bar’s boycott had not yet been felt but that the first serious trials requiring QCs were due to reach court in the new year.

The first setback for the LSC has already occurred,. The 17-year-old accused of shooting dead schoolboy Rhys Jones was left without a QC a month before the trial was due to start and his solicitor was working for free. The problem occurred because the Legal Services Commission initially insisted that the defendant’s lawyers worked for a fixed fee, but they have now made an exception and reverted to the old pay structure. The LSC’s director of high cost case contracting has acknowledged difficulties with forthcoming large trials, and there may have to be other exceptions in future.