David Armstrong and Stephanie Barratt look at the prognosis for medical negligence funding in Scotland
Medical negligence cases face an uncertain prognosis when it comes to securing funding for claims.
In Scotland, medical negligence is thankfully rare but when care falls below the reasonable standard, the outcomes can be devastating for patients and their families. Claims inevitably arise as redress and compensation for loss or injury are sought.
However, the constraints on sources of funding, such as legal aid and insurance backed claims, could seriously jeopardise access to justice for potential claimants in Scotland. 2015 figures have revealed that a more cautious approach is being taken by organisations funding medical negligence claims in Scotland.
Complexity, cost and high risk mean that all but wealthy self-funding clients, or the small number entitled to legal aid, can consider pursuing a case.
With a conservative estimate of fewer than one in five cases in Scotland of alleged medical negligence being pursued, a significant business opportunity could present itself for some, if a solution to the funding crisis can be found.
Litigating cases: cost and risk
Medical negligence cases are notoriously expensive to run, largely due to their reliance on expert evidence.
Rarely does a report give change from £1,000, and in most cases multiple reports are required to prove negligence. Financing those reports and other outlays is a challenge to law firms. Experts are understandably reluctant to have their fees deferred in what are usually long running cases that can last several years.
As with most cases traditionally raised in Scotland’s highest civil court, the Court of Session, instruction of counsel is commonplace and generally merited. Like experts, the pool of advocates willing to work now and be paid later is diminishing, which is hardly surprising if settlement could be two, three or possibly four years away.
Recent reforms to the Scottish civil court system regarding moving business from the Court of Session to a specialist personal injury court seem unlikely to change counsel instruction significantly – the complexity of most medical negligence cases warrants counsel’s involvement, regardless of value.
From a law firm’s perspective, tying up work-in-progress in cases running for years is a financial gamble requiring a steady eye on cash flow and a confidence that the case will succeed. Nothing new for personal injury lawyers, you might say, but less attractive if the work required to settle or win the case is disproportionate to the return.
Reading through lengthy medical records, consulting with several experts, and dealing with an NHS legal system adverse to early settlement, make medical negligence a challenging area to work in. In short, costs are high and the risk is corresponding.
When a case is won, the results can be very rewarding – a pursuer will generally receive a five or six figure pay-out on damages, and the representing firm will benefit from the Court of Session fee scale. Yet, when a case is lost the pursuer may find their time and energy wasted, while their representing firm are left to foot the Defender’s fees.
In order to eliminate this risk to Scottish firms, there are two main funding models available in Scotland: legal aid or After the Event Insurance (ATE).
Legal Aid, the traditional funding model
The Scottish Legal Aid Board (SLAB) used to fund most of the medical negligence litigation brought in Scotland. However, with a diminishing legal aid budget and policy changes at government level, obtaining legal aid is not as straightforward as it used to be.
In 2013-2014, over half of civil legal aid applications to SLAB were rejected at the initial stage, with even fewer being given due consideration after the initial sift.
To qualify for legal aid, SLAB requires an applicant to prove financial hardship, a reasonable chance of success, a minimum value of £10,000, and that all other avenues of funding have been exhausted. A Scot with an average income will be unable to prove financial hardship, and without the preliminary views of a medical expert, reasonable pr