NMA: CFA Regime Must Be Reformed

The News Media Association has called for reform of the conditional fee agreement regime which “creates a chilling effect upon freedom of expression and journalism” following a judgement in the Supreme Court.

This week, Justices of the Supreme Court dismissed newspaper publishers’ appeals against costs orders requiring the  payment of  the claimants’ success fees and ATE premiums in three separate libel and privacy cases involving Times Newspapers, Associated Newspapers and Mirror Group Newspapers.

The newspapers had argued that the costs orders under the CFA regime infringed their rights under Article 10 of the European Convention on Human Rights but the Justices said allowing the appeals “would be a graver infringement of the claimants’ rights” and dismissed them.  

Santha Rasaiah, News Media Association legal, policy and regulatory affairs director, said: “The CFA regime that requires losing newspapers to pay the claimants’ costs with lawyers’ success fees of up to twice the normal fee and exorbitant ATE premiums creates a chilling effect upon freedom of expression and journalism.

“As the Supreme Court described, this regime has been subject to wide spread criticism, in Strasbourg, by the domestic courts and by reviews since the 1999 Act came into force.

“Yet legislative reforms have not been brought forward for defamation and privacy actions. Worse, Section 40 of the Crime and Courts Act 2013 would require newspapers to pay claimants’ costs, win or lose, unless they signed up to the regime under the state sponsored Royal Charter

“These threats to the fundamental right of freedom of expression must be removed. The CFA regime must be reformed and Section 40 must be repealed.”

In a leader, The Times said: “News organisations should take responsibility for poor reporting. Individuals defamed or libelled by them should have access to justice regardless of their means. A clear lesson of this case, however, is that CFAs are not a fair way to secure this access. Instead of a just outcome, a responsible newspaper has been forced to pay steep legal costs for the privilege of publishing what no one disputes is important public interest journalism.

“Yesterday’s ruling comes at a time when such journalism is under severe threat from unregulated and often flagrantly irresponsible online outlets. Those who would prefer a cowed press to a free one will argue for an even more punitive regime — set out in Section 40 of the Crime and Courts Act 2013 — but this would force newspapers to sign up to a state-backed regulator or be liable for the full costs of any libel case whether they won or lost.”

Ian Murray, Society of Editors deputy executive director, said: “The Society of Editors, alongside other media organisations, has, for years now, highlighted the fact that lawyers on CFA cases charge inordinate success fees which are manifestly unreasonable and bear little relation to either the risk they undertake in accepting a case or the level of damages awarded. It is not uncommon to see success fees significantly higher than the level of damages awarded. 

“CFA success fees are as detrimental to press freedom as the threat currently being posed by Section 40 of the Crime and Courts Act. Any decision to commence measures that would force newspapers to pay both sides costs in defamation and privacy cases, regardless of whether or not they successfully defend a case, makes even more of a mockery of the idea that justice should be fair. 

“Only the government can correct the faultline at the heart of legislation surrounding privacy and defamation and ensure that the claimant lawyer gravy train that we have seen in recent years is stopped once and for all. It is essential that costs orders in relation to such cases are fair and proportionate and do not threaten the future of investigative journalism.”