§ 3.6 p.m.
§ Lord Bradshawasked Her Majesty's Government:
What action they are taking to deal with bogus claimants and their lawyers who claim for damages in accidents in which they have not been involved.
§ The Parliamentary Secretary, Lord Chancellor's Department (Baroness Scotland of Asthal)My Lords, the pursuit of those who make bogus claims is a matter in the first instance for the police. If an organisation feels that a bogus claim has been made, it should consider whether to report this to the police. While that applies equally to lawyers, they are additionally subject to strict rules of conduct, maintained by the self-regulating legal professional bodies, which preclude lawyers from acting dishonestly. It is for the legal professional body concerned to take action where it considers a breach of the rules has occurred.
§ Lord BradshawMy Lords, I thank the noble Baroness for that reply. My question refers to a case in Manchester where an empty bus left a depot. Subsequently, 22 people claimed to have been injured although no one had been travelling on the bus. A firm of solicitors solicited the claims by telephone. Will the noble Baroness take action—and I mean strong action— both to discourage fraudulent claims and to ensure that firms of solicitors engaging in such practices are struck off? Does the case not convey a message about contingent-fee litigation?
§ Baroness Scotland of AsthalMy Lords, I hear what the noble Lord says, and I join him in condemning such terrible behaviour. When such fraudulent behaviour is discovered, all those with knowledge of it should report it to the police—who are the proper agency to prosecute all those involved in such deception. I can but say that that works very effectively when and if it is done.
Lord Carlile of BerriewMy Lords, does the noble Baroness agree that insurance companies are in the front line of the fight against bogus claims? Is she aware that many insurance companies now feel inhibited in making secret inquiries and surveillance of claimants whom they believe are making bogus claims as a result of the insurance companies' understanding of cases decided in the European Court of Human Rights and domestic cases with a human rights component? Will the Government do their best to ensure that insurance companies are not inhibited from proper investigation of what may well be bogus insurance claims?
§ Baroness Scotland of AsthalMy Lords, again, I hear what the noble Lord says. I also hesitate before saying that the insurance companies should get some good lawyers. To the best of my knowledge and belief, there is no improper inhibition employed in relation to insurance companies doing that which they need to do 228 to ensure that fraud is not perpetrated. Fraud generally is taken very seriously by this Government. An intergovernmental working group including representatives from the Home Office, SFO, the police, LSLO, CPS, FSA, DTI and HMT are currently working to consider means of improving the response to fraud. They are doing very good work.
§ Lord Phillips of SudburyMy Lords, in answering the question of my noble friend Lord Bradshaw, the noble Baroness did not refer to the last point he made regarding contingency fees. Will she comment upon the propensity of contingency fees, or conditional fees, to lead to a greater degree of unscrupulousness on the part of the tiny minority of the legal profession who are so inclined?
§ Baroness Scotland of AsthalMy Lords, we certainly have no evidence to suggest that conditional fees have increased the preponderance of fraudulent behaviour as the noble Lord suggests. They have indeed increased access to justice because individuals who could not afford to litigate privately despite having good cause now can. Public funds have been focused on other priorities where the market cannot yet provide. It is in a solicitor's interests to ensure that bad cases are not brought before the courts and are weeded out of the system. It is right to remind noble Lords that fraud within the legal profession, particularly in the branch of the profession in which the noble Lord, Lord Phillips, is involved, is perpetrated by a tiny minority. I believe that the figure is less than 0.22 per cent. Therefore, the majority of lawyers uphold the integrity of their profession with great aplomb.
§ Lord Campbell of AllowayMy Lords, is not the Question, frankly, wholly misconceived? What on earth are Her Majesty's Government supposed to do about the fraudulent claim in Manchester? It has nothing to do with Her Majesty's Government. Good heavens, insurance companies make inquiries as a matter of course that indicate where there is a propensity for a bogus claim. I simply do not understand the purpose of the Question other than to have a "dig" at certain lawyers.
§ Baroness Scotland of AsthalMy Lords, I share the perplexity of the noble Lord, Lord Campbell of Alloway. I am pleased to agree with him that the subject matter of the Question has nothing to do with Her Majesty's Government.
§ Lord AcknerMy Lords, conditional fees have a lot to do with Her Majesty's Government. Is not the real problem with the conditional fee that you have a situation in which the lawyer has a direct interest in the outcome of cases? That is why in the past conditional fees were considered contrary to the public interest.
§ Baroness Scotland of AsthalMy Lords, the comments of the noble and learned Lord in regard to conditional fees constitute an argument that has been advanced for some time. We have looked carefully to determine whether there is any evidence base to support that argument and whether the assertion of the noble and learned Lord is correct. However, we have no information to indicate that that is the position at the moment. If and when we do have such evidence, we shall take it extremely seriously and shall address the matter speedily.