Martin Partington: Spotlight on the Justice System

Keeping the English Legal System under review

Posts Tagged ‘small claims

Whiplash reform programme: implementation

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Way back in March 2019 I noted the enactment of the Civil Liability Act 2018. One of its principal objectives was to introduce a new way of dealing with claims for ‘whiplash injuries’ suffered when a car is hit from behind, causing those in the front car to suffer whiplash. It had been planned that the new scheme would come into operation in April 2020. The Government has now announced that it will commence on 31 May 2021.

The Whiplash Reform Programme provides, among other things that:

  • A fixed tariff of compensation will determine the personal injury damages claimants will receive for whiplash injuries. Until now, most whiplash claims are determined by negotiation rather than by a ruling from a judge. The tariff – set by the Lord Chancellor – will in future decide the issue. The levels of compensation will be reviewed by officials every three years.
  • There will be a ban on settling whiplash claims without medical evidence. It was argued that, in the past, insurance companies paid out on small claims which had been made without any supporting medical evidence because it was not financially worth their while to resist them. The effect of paying out on unmeritorious claims was to increase the costs of motor insurance, to the detriment of motorists who did not make unwarranted claims.
  • A new online official Injury Claim Service will be established which will enable claimants to source medical reports to ensure claims are supported by medical evidence before settlement.
  • The Small Claims Track (SCT) limit for Road Traffic Accident related Personal Injury claims will be raised from £1,000 to £5,000. This means that the majority of such claims (which are for sums under £5,000) will no longer be subject to fast track rules, where the recovery of legal costs operates on the ‘loser pays’ principle but will be allocated to the SCT, where parties are responsible for paying their own legal costs.

It is hoped that the introduction of the Official Injury Claim Service which has been designed to provide claimants with a user-friendly digital system, supported by guidance, will enable all claimants, particularly those without legal representation, to make and settle their own claim pre-court. It is also hoped that the new system will stop unmeritorious claims from being made.

Since these changes are expected to result in insurance companies being able to reduce their overhead expenditure on motor insurance, insurers are required to provide to demonstrate that they have passed any savings on to customers.

Further information on the new scheme is at https://www.gov.uk/government/publications/whiplash-reform-programme-information-and-faq

Written by lwtmp

April 27, 2021 at 3:48 pm

Transformation of the justice system: money claims online

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In November 2018, HM Courts and Tribunals Service launched its money claim online service. On July 3 2020, it announced that a significant milestone had been reached in the use of this service, namely that, after 18 months, over 100,000 cases had gone through the new system.

The Government states:

The service aims to make it simpler and quicker for people to submit a claim, by allowing them to do so from their own home and removing complex legal language from the online application. Most people take less than 15 minutes to complete the initial claim form. Almost 9 in 10 people using the service have been satisfied or very satisfied with it, with claims now being issued in minutes, not days.

In many cases, this that means claims can be issued, responded to and settled without the need for third-party involvement.

See https://www.gov.uk/government/news/more-than-10000-civil-money-claims-issued-online

(The figure IS 100,000, not the 10,000 mentioned in the Press Release Heading!)

Written by lwtmp

July 4, 2020 at 11:03 am

Money claims on line

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For many years it has been possible to start a small money claim by completing forms on-line and submitting them to the court.

In April 2018, following a pilot launched in July 2017, a new on-line process for making a money claim with a value of up to £10,000 (the current small claims limit)  has been launched, designed to be easier to use by potential claimants. Rather than having to fill in and post a paper form, or use the original on-line system which dated from 2002, the new pilot allows people to issue their County Court claim more easily, settle the dispute online and also recommends mediation services  (which can save time, stress, and money).

According to the Press Release announcing this decision “Early evidence [from the original pilot] suggests that the online system has improved access to justice as engagement from defendants has improved.”

At present, it seems that the only way that one can see how the new process works in practice is to go on-line and submit the details of a potential claim – this includes setting up a special account. What I think is urgently required is one of those ‘how to’ videos that are available on You Tube. (There are videos with this or similar titles but they don’t specifically refer to the new MoJ scheme.)

The press release announcing the development is at https://www.gov.uk/government/news/quicker-way-to-resolve-claim-disputes-launched-online.

If you would like to explore the money claim website more fully, it can be found at https://www.gov.uk/make-money-claim

 

Changing the small claims track

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In November 2015, the Government announced that it planned to increase the small claims limit for personal injuries to £5000. Following a consultation on making reforms to soft tissue injury claims (often referred to as whiplash injury) the Government has now (March 2017) decided that while Road Traffic Accident claims for less than £5000 should stay in the small claims track, the small claims limit for other personal injury claims should become £2000. It plans that these new limits should be in effect by October 2018.

The Government is also intending to ban the settlement of whiplash claims unless  medical evidence  is provided of the alleged injury.

For details see https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/593431/part-1-response-to-reforming-soft-tissue-injury-claims.pdf

Written by lwtmp

March 29, 2017 at 3:14 pm

Compensation culture: cutting down ‘whiplash’ claims

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Those who argue that a compensation culture has developed in our society – with too many people willing to seek compensation for things that have happened to them – often point to the numbers of claims made for soft tissue injuries occurring in road traffic accidents (RTAs), commonly referred to as ‘whiplash claims’

In 2015, the Government announced that it wanted to reduce the incentives on people bringing whiplash claims. It has now published a consultation paper setting out its ideas in more detail.

The package includes measures to tackle the high numbers of minor RTA related soft tissue injury claims by either:

 (a) i.removing compensation for pain, suffering and loss of amenity (PSLA) following an accident or
ii. reducing compensation for PSLA by setting a fixed amount payable (£400 or
£425 if there is a psychological element) for these types of claim.
(b) reducing compensation for PSLA for other RTA related soft tissue injury claims
where recovery takes longer than for those covered by measure (a) above through
the introduction of a set tariff of compensation;
(c) raise the small claims limit for all personal injury claims to £5,000 (by reference to
the value of the PSLA element of the claim). This would have the effect that the
legal costs of such claims would no longer be recoverable from defendants in the
majority of soft tissue injury claims, although certain costs arising from litigation
(for example the costs of issuing the claim) and a number of disbursements (for
example the cost of the medical report) could still be claimed by a successful
claimant; and
(d) ban pre-medical offers to settle RTA related soft tissue injury claims, so in future
claims could not be settled without medical evidence provided by MedCo accredited practitioners.

 

Measures (a), (b) and (d) will require primary legislation and the government intends to legislate as soon as parliamentary time allows.Measure (c) requires changes to the Civil Procedure Rules (CPR). There will also need to be amendments to relevant Pre-Action Protocols including the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents.

It is argued that these changes could reduce the cost of insurance claims by around £1bn annually.

The Consultation will provoke strong views, and are likely to be fiercely resisted, particularly by those who represent claimants. If implemented, the reforms could also have significant impact on Claims Management Companies.

The outcome of the consultation is not yet clear, nor, importantly is it clear when time for the required legislation could be found. But it is an issue that is unlikely to go away, even if implementation is still some time off.

The Consultation can be found at https://consult.justice.gov.uk/digital-communications/reforming-soft-tissue-injury-claims/

 

Written by lwtmp

November 23, 2016 at 11:02 am

Public expenditure review: impact on the Justice system (2): the future of personal injuries litigation

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A totally unexpected announcement in the 2015 Autumn Statement relates to how personal injuries cases are to be dealt with in future. The statement says (at p 125):

3.103 Motor insurance – The government will bring forward measures to reduce the excessive costs arising from unnecessary whiplash claims, and expects average savings of £40 to £50 per motor insurance policy to be passed onto customers, including by:

••removing the right to general damages for minor soft tissue injuries (Claimants will still be entitled to claim for ‘special damages’, including treatment for any injury if required and any loss of earnings);

••removing legal costs by transferring personal injury claims of up to £5,000 to the small claims court.

This announcement has caused consternation amongst PI claimant lawyers since, by moving many more cases into the small claims track, they will not be able to claim their costs from the insurers when they win. This will result in many claimant lawyers giving up this type of work.

Two consequences seem likely to follow:

First, insurers will be able to put more pressure on claimants to settle on terms dictated by the insurers.

Second, claims management companies may well try to find ways to move in to this work.

Despite the fact that many claimants may end up with a lower level of damages than they might have done had they been represented by a lawyer, many will think that the estimated reduction in insurance premia is a price worth paying to ensure that the costs of small claims are more proportionate than they currently are.

There might, however, be another way of looking at the issue.

In Ireland, the Injuries Board – established by Act of Parliament in 2003 – can deal with all personal injury claims on line. The injured party submits details of the accident and the injury; the insurer makes an offer; and this is assessed by an independent assessor with practical experience of PI and familiar with current trends on the awards of damages by the courts.

There is no compulsion to use the system, but it is free to claimants who win their case, and the services costs much less for the insurers (though still makes an annual surplus).

An analogous scheme already operates in the UK for dealing with tenancy deposit disputes.

The full statement  is downloadable at https://www.gov.uk/government/publications/spending-review-and-autumn-statement-2015-documents.

For the Irish Injuries Board, go to http://www.injuriesboard.ie/eng/

Written by lwtmp

November 30, 2015 at 12:51 pm