Market Power, Unfair Advantage and Data Sharing – Claims Farming Raises Bigger Questions

Claim farming allegations give rise to bigger questions

By: Jerome Doraisamy – LawyersWeekly


There are always significant concerns across the profession about practices such as claim farming and data sharing, according to Solicitors principal and Queensland Law Society immediate past president Christine Smyth.

But perspective needs to shift, she said, to a focus on the bigger picture, and not just the supposed actions of a single law firm.

“There are a number of ways to claim farm, and the reported example [about Slaters] is just one of those. It doesn’t have to be cold-calls… it can be a lawful gathering of material, which people have a reasonable expectation to be private, but might instead be buried deep in the fine print,” she said.

“The real question centres around whether that is informed consent in such matters. Approaching people who are vulnerable may not just be confronting and unwelcome, it may also breach ethical rules.”

Australian Accident Helpline founder Liam Millner said that individuals should never be approached and instructed to make a claim.

“Individuals don’t like being told they should make a claim… it’s invasive and, often, individuals can feel like they’re being bombarded by law firms and legal jargon,” he explained.

Australia is behind the eight ball when it comes to educating the public on their rights, with many law firms being able to bombard the “unsuspecting public” with cold-calls.

Further, the personal injury sector in Australia is a monopoly, he submitted, with four or five prominent firms dominating the space with heavy advertising and marketing ploys.

“Not every lawyer out there is dedicated to fighting for what’s right, some are just in it for the payout,” he said.

“Individuals should be able to make up their own mind but they can’t do that if they don’t have access to resources or aren’t aware of their rights when it comes to claiming compensation.”

Ultimately, discussion about claim farming, or any other proactive strategy to sign a client with a potential right to seek damages, has to be viewed through the lens of access to justice, Ms Smyth argued.

“This is not an access to justice issue…it’s abuse of justice,” she posited.

“If any organisation is harvesting data, no matter how they do it and feed it into their business model, that is very different to having clients approach you for your skillset alone.”

“It’s touting on steroids,” she surmised.

The major personal injury law firms and collaborating businesses have a significant advantage over the individual — many of whom are vulnerable — in terms of purchasing power, she added.

“Any abuse that occurs, or skirting of ethical boundaries, disadvantages us all,” she concluded.

“Ethics is doing the right thing even when someone isn’t watching.”

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