Libel reform stalls

Changes to no-win no-fee rules for libel lawyers have first been delayed by back-bench MPs and now dropped as parliament winds up business before the election.

Claimants can sue for libel without having to pay a lawyer, provided the lawyer thinks they have a good chance of winning. If they do win, the other side pays the lawyers costs and the claimant collects the damages with no financial risk. The lawyers take the risk, but they benefit from an uplift fee if they win.

Currently, libel lawyers can double their fees if they win a no-win no-fee case. This can mean defendents paying costs disproportionate to the defamation they have caused. Some libel lawyers charge £500 an hour. With the uplift fee, a defendant might be paying £1000 an hour.

Damages in a libel action are typically a few tens of thousands of pounds. Costs are often ten times that level.Costs in English libel courts are 140 times the European average a study by Oxford University found last year.

The Ministry of Justice was changing the libel law to reduce the uplift fee from 100% to 10% extra. That legislation has been set aside now and only time will tell whether the next government will restart libel cost reform.