The Government’s proposed statutory instrument to reduce the maximum success fee in libel Conditional Fee Agreements (“CFAs”) has been voted down by the House of Commons First Delegated Legislation Committee, by 11 votes to 5.   The record of the proceedings in the Committee can be found here, here, here and here.  After an interesting debate the Committee rejected the motion that the “Committee has considered That the Committee has considered the draft Conditional Fee Agreements (Amendment) Order 2010” by 11 votes to 5.  The debate is available on Parliament TV.

The proposal to reduce the success fee from 100% to 10% was controversial.   There was a very short consultation period.  The measure was opposed by the Bar Council, the Law Society, the Master of the Rolls and the Chief Costs Judge amongst others – although enthusiastically supported by the media.   The House of Lords Merits of Statutory Instruments Committee drew ‘the special attention of the House’ to the measure, noting,

we regret that insufficient time has been allowed to produce a solution based on more robust evidence or on which there is broad agreement, and that might seem more likely to achieve the policy objective without the potential side effects“.

Some of the background is explained by Dr Andrew Scott in a post on the MediaPal@LSE blog.

It appears that the rejection of this measure by the Committee will mean that it will not be passed by the present Parliament.

Update: This story has now been reported in the Press Gazette “MP’s revolt may have scuppered libel reform”.   According to “Media Lawyer” Jack Straw was said to be “hopeful” today of salvaging the legislation and campaigners for reform said they were “aghast” that the issue may now be kicked into the long grass, as the dissolution of Parliament for the general election approaches.