Halloran verdict `bigger than Callery' and predicted to make injury law unworkable

Personal injury lawyers have hit out at the Halloran v Delaney decision, which has been lauded as a great money-saver for insurers.

The ruling reduced the level of success fees in simple personal injury cases from 20%, as suggested during Callery v Gray, to 5%.

It will make personal injury law "unworkable", the Association of Personal Injury Lawyers (APIL) has claimed.

APIL will seek meetings with the government and the Master of the Rolls to discuss the issue.

The claim was for personal injuries received in a car accident in May 2000.

A conditional fee arrangement was entered into and £1,500 settlement reached in December 2000.

In February this year the District Court allowed a 20% uplift on the costs of the costs-only proceedings.

On appeal, the court said 5% should be the norm in simple cases that are settled without commencing proceedings.

David Pickford of Forbes Solicitors said the Appeal Court's decision was much wider than Callery, which gave an example of 5% applying where the claim was settled in the protocol period.

"In the case to hand, 5% is said to apply in simple cases, [which] appears to include any straightforward case settled without litigation, whether before or after the expiry of the protocol period," he said.

APIL president Patrick Allen said the judgment ignored the "detailed technical deliberations" of Callery, in defiance of logic and common sense.

"The aim of the success fee system is to enable personal injury solicitors to build up enough funds to enable them to bear the cost of losing cases," he said. "Without such funds in place, only the simplest cases will be brought, leaving difficult but equally valid cases out in the cold."

Allen said firms that predicted income based on an average success fee of 20% would fall short, as the Halloran verdict was backdated to all claims undertaken since August 2001. "No business on earth can balance books this way and stay in business," he said.