PERSONAL INJURY: An Introduction

The most surprising and welcome development for personal injury claimants in the past 12 months was the decision by the then Lord Chancellor Liz Truss MP to cut the discount rate for calculating future loss from plus 2.5% to minus 0.75%. The impact was dramatic. Most media attention was on the potential cost to the NHS in clinical negligence cases. But it affected all personal injury claims with future loss; in my own case of Marsh v Ministry of Justice [2017] EWHC 1040 (QB), where the trial concluded before the change, but judgment was given afterwards, the value of the claim for future pension loss for a 56-year-old public sector worker nearly doubled. Even though insurers have had the benefit of a discount rate that significantly under-compensated claimants for more than a decade they turned up en masse to complain to the Chancellor of the Exchequer the following day and the government immediately issued a consultation paper. In it the government firmly committed itself to keeping the full compensation principle whilst expressing concern at the cost to the public. How they propose to square this circle, and whether and when they will be able to force a change through Parliament, will become clearer over the next 12 months. In the meantime, the uncertainty will unfortunately permeate the handling of all serious injury cases including the making of offers, the timing of settlement meetings and no doubt applications to delay, adjourn, or indeed to accelerate, trials.

The new government has also said that they propose to take forward proposals for whiplash reform in a new Civil Liability bill. Although they have lost their majority, the EVEL principle (English votes for English laws) should, provided it is passed before the next general election, mean a comfortable government majority on this issue both in Committee and in the House of Commons. And as it is one of the few proposals from the Conservative Party manifesto to actually survive into their legislative programme, convention says that the House of Lords will not ultimately vote it down. That said, the bill is unlikely to be plain sailing for the government. The definition of whiplash is not without difficulty, the proposed tariff regime is both novel and a substantial reduction in compensation payable from current levels. The judiciary in various consultation responses are obviously concerned at not only the principle, but also the practical implications for court resources in handling a potentially huge increase in whiplash claims being brought by litigants in person, possibly with the assistance of claims management companies, in the small claims track. Given the new judicial activism evident in R v Lord Chancellor [2017] UKSC 51 (the employment tribunal fees case), the Ministry will still have to be very careful to proceed lawfully in implementing any powers given by Parliament.

Lord Justice Jackson delivered his supplemental report on Fixed Recoverable Costs on 31 July 2017: The Ministry of Justice will consult on it. We already had fixed recoverable costs in the Fast Track for most accident claims. Submissions to the Jackson review did not suggest Fast Track fixed costs for accident cases were having a huge detrimental impact on access to justice. The arbitrary £700 reduction by the Ministry of Justice from the empirically derived fixed costs 'for abolition of referral fees', although annoying and unjustified as marketing costs still have to be incurred, has obviously had proportionately less impact in Fast Track cases than in the Portal. Jackson has recommended an inflation increase, albeit on advice from his economist assessors, by less than CPI inflation. Noise induced hearing loss claims should benefit from the Civil Justice Council sponsored industry agreement on a new process with fixed recoverable costs which was endorsed by Jackson. The biggest change will be the proposed new Intermediate Track for claims of moderate complexity up to £100,000. This is much lower than the £250,000 one-size-fits-all proposal originally floated, and considerably more nuanced with the four complexity bands. The proposed fixed recoverable costs are derived from personal injury data. Claims will have to be allocated to the new Intermediate Track (or obviously suitable for it if it is settled pre-issue) so will not fall into a fixed costs regime simply by reason of damages falling below £100,000. Jackson also recommends that the new track should not normally be suitable for clinical negligence, asbestos, child sexual abuse and police claims, nor for cases which cannot be tried fairly within the new streamlined procedure. Although claimant lawyers will naturally be wary of fixed costs, and the tactical advantages potentially available to insurers, nonetheless certainty, speed of process and speed of payment are potential advantages. In addition, removing a tranche of cases from budgeting should allow court resources to be better directed at the cases remaining within the multi-track. This should mean much earlier dates for CCMCs, bespoke directions and budgets and faster hearing dates. The biggest divide between Jackson’s assessors was over the treatment of costs after Part 36 offers – should costs be assessed, following Broadhurst v Tan [2016] EWCA Civ 94, or subject only to a fixed percentage uplift. Jackson came down in favour of the latter, but said expressly this was an issue on which there must be consultation. There may be room for a different approach in personal injury where QOCS applies and most cases involve an insurance company.

Brexit will overshadow much of the next year in all fields. Personal Injury litigation is no different. Litigating accidents abroad in the UK has become a significant contribution to personal injury business, and clarity as to how this will be dealt with after Brexit is needed. In addition, although much health and safety legislation has its origin in pre-EU statutes, and the common law underpins rights, the contribution of the EU directives has also been important. Ensuring that workers’ rights in particular are not eroded by Brexit will be an important battle.

Finally, unfortunately the image of personal injury lawyers remains poor. As a profession we do not always help ourselves (eg, the way in which holiday sickness claims hit the news), but the media is quick to lambast ‘no win, no fee’ lawyers as ‘ambulance chasers’. In the absence of legal aid for most of our work, ‘no win, no fee’ is the only viable route to access to justice. In reporting of recent disasters, lawyers for victims are expected by the media to assist them entirely for free (which, although essential in the immediate aftermath, for obvious reasons can only be limited help) or under legal aid (which largely doesn’t exist) and not under ‘no-win, no-fee’ even if that is on the basis there will be no deduction from any damages awarded. Local authorities and insurance companies facing blame will inevitably be spending very large amounts of money, often public money, on expensive, expert legal advice. If we want to maintain equality of arms for ordinary people who are the victims, in the absence of public funding being restored, we all need to work hard to try to change this public discourse.