Legal Fees and costs recovery

From 1st October 2012, the rules on the recovery of defence costs changed i.e. those persons who are prosecuted but not found guilty of the offence.   These new rules affect all offences committed after the 1st October 2012.
Individuals
For all individuals who are found not guilty by the magistrates’ court, or have their matters withdrawn or dismissed, that person may only be able to recover a proportion of their legal fees, which is likely to be approximately one third, and not the full amount that they incur.
However, in the Crown Court, costs can only be included in a defence costs order made in appeal proceedings against a conviction or sentence of the magistrates’ court.  In relation to Crown Court proceedings on indictment, legal costs cannot be included in a DCO.
Companies
For companies, the situation is bleaker.  No company can recover costs from central funds.  However, from the 1st April 2013, company’s will be entitled to Legal Aid for certain offences.
What should businesses do to?
Companies should consider getting legal insurance.  However, once again policies need to be read carefully as they often will only cover certain types of offences.
Will the effect be that companies will consider not defending matters that they are not guilty of, on the basis of purely on economic grounds? Potentially this could be the case.  However, for those companies with Operator’s Licences, they need to consider the effects a conviction will have on their ability to hold a licence and they could be called to a Public inquiry as a result of that conviction.
Jared Dunbar

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