The lord chancellor acted 'unlawfully' in the way he consulted on controversial plans to shake up criminal legal aid, the High Court ruled today.
Mr Justice Burnett said that the ministry's failure to disclose the findings of two key reports on plans to introduce new dual criminal legal aid contracts was 'so unfair as to result in illegality'. Quashing the lord chancellor's decision to limit the number of duty provider contracts to 525 he advised a 'relatively short' reconsultation of the profession.
However the first tranche of 8.75% fee cuts, introduced in March, will remain in place. Mr Justice Burnett said the question of contract numbers, if consulted on in the way it should have been, would not have led to a different decision on the phased introduction of criminal legal aid fees.
The result is a victory for claimants the Criminal Law Solicitors' Association and the London Criminal Courts Solicitors' Association, and will be a huge embarrassment for the lord chancellor.
However, the government could still seek to introduce the two-tier contracting model proposed, with separate tenders for own-client and police station duty work. The possibility of a further 8.75% fee cut remains hanging over the profession.
LCCSA president Nicola Hill said: 'This is a great day for justice. It shows that no one, not even the justice secretary and lord chancellor, Mr Grayling, is above the rule of law. It proves what we've said all the way along. These so-called "reforms" were sold in the name of austerity. They're being railroaded through by a justice secretary determined to push through an ideology.'
Hill said the cuts are an assault on justice, threatening the principle of innocent until proven guilty and equal access to justice. She said she hoped the judgment would serve as a 'wake-up call' to Grayling. She added: 'We're looking forward now, not back. Changes are needed in our court system and the provision of legal aid. But instead of ignoring those of us who work within the system, we suggest grown-up, respectful discussions to maintain a justice system we can all be proud of.'
CLSA chair Bill Waddington welcomed the judgment as a 'damming indictment' of the lord chancellor. 'The head of our world-renowned justice system must act fairly. Instead, he has attempted to enact a plan that is manifestly unfair. Limiting access to justice and shredding the treasured principle of equality before the law,' he said.
An MoJ spokesman said: 'This JR was not wholly successful. The claimants failed in their challenge to the fee cut. However, the judgment has raised some technical issues about the consultation process, which we are carefully considering.
He said the ministry will continue to implement reform of the criminal legal aid system in order to ensure legal aid is sustainable for those who need it and for taxpayers.
'Even after reform we would still have a very generous system at around £1.5bn a year,' he added.
The claimants successfully argued that the Ministry of Justice had unfairly withheld two economic reports, one from Otterburn Consulting and the second from accountants KPMG until the end of the consultation, depriving consultees of an opportunity to comment.
The groups said the government had ignored the findings of the Otterburn report, which indicated the criminal defence provider market needed time to consolidate before bringing in changes, despite giving assurances that it would adopt the findings.
The KPMG report, commissioned by the MoJ, raised questions over the feasibility of the arrangements, but these were skated over by the ministry.
During the two-day hearing that took place on 7 and 8 September, the court heard allegations that Grayling had had been 'personally involved' in the consultation process and created much of the 'unfairness' himself.
In advance of the action, CLSA and LCCSA raised more than £100,000 from the profession towards its costs and the Law Society contributed £45,000 after efforts to mediate with the MoJ came to nothing.
Law Society president Andrew Caplen called on the lord chancellor to respond to the ruling, saying he is 'acutely aware of the potential devastation' facing criminal solicitors and the public.
'We have no doubt that the government's proposals will have a direct impact on the viability of solicitors providing these all-important services to their local communities,' Caplen said. 'Under my presidency, the Law Society will do all in its power to support criminal legal aid solicitors and to defend the rule of law. I will engage fully with our members to draw further attention to the plight of criminal law practitioners and the threat to the working of the criminal justice system that has been highlighted by today's ruling.'
Jason Coppel QC and Joanne Clement of 11 KBW, instructed by Adam Chapman and Emily Carter at London firm Kingsley Napley, represented the claimants.
James Eadie QC and Fraser Campbell of Blackstone Chambers and Richard O'Brien of 4 New Square, instructed by the Treasury solicitor, represented the lord chancellor.
Read the judgment here.