Ken Clarke’s culture of impunity for corporate human rights abusers

By Andy Slaughter MP / @hammersmithandy

In June, we welcomed the government’s endorsement of the UN’s Protect, Respect and Remedy Framework on Business and Human Rights, which works to provide greater access to justice for victims of corporate harm. Today, that endorsement looks like nothing more than an exercise in public relations.

The Legal Aid, Sentencing and Punishment of Offenders Bill currently going through committee stage in Parliament is set to end the ability of lawyers to take on business and human rights cases like Trafigura or the recent Shell Nigeria case.

Because legal aid isn’t available in such cases the costs are funded through a “no win, no fee” arrangement. The lawyers of the alleged victims fund all of the legal costs, on the basis that they can be reclaimed from the corporation if the case is successful. So Leigh Day & Co., the law firm who brought the case against Trafigura, were able to spend tens of millions of pounds and years of effort sending a team of lawyers to collect evidence from 30,000 Ivorian claimants. As these cases are high risk, they were also allowed to charge a “success fee”, which was paid to them after Trafigura settled out of court, which allows them to fund future cases that they might end up losing. Martyn Day, a senior partner at the firm, said: “the no win, no fee scheme was the only way we could bring the case. We simply could never have run the case if we did not have the prospect of obtaining the success fee from the defendants.”

Under the new proposals, success fees would be abolished, rendering many firms unable to take on similar cases in the future. Amnesty International, who are campaigning against the provisions in the bill, have said the it “will have the combined effect of severely reducing the ability of law firms to take on human rights litigation against multinational companies.” Harvard University lawyer John Ruggie, the UN Secretary General’s Special Representative for Business and Human Rights, wrote to justice minister Jonathan Djanogly in June expressing concern about what he referred to as “disincentives” for law firms to take up such cases.

Plans to cut £350m a year from legal aid and the planned reform of conditional fee agreements will deter lawyers from taking on cases they feel they might not win. Under current measures, the success fee allows a lawyer the space to build up a ‘risk pool’ and take on cases such as the one brought against Trafigura. If success fees are unavailable from the start, the risk of taking on such cases becomes untenable, which sends out the worst kind of signal: that corporate wrongdoing will go unpunished, potentially leading to the loss of lives and livelihoods around the world.

On Tuesday my colleague Kate Green, Labour MP for Stretford & Urmston is proposing an amendment to the Bill which would ensure the current system is maintained for these important cases. With just a few clicks of your mouse, you can support us and the victims of overseas corporate malpractice by sending a letter to your MP.