Market round-up: March 2020

 
Market Round-up

Market round-up: March 2020

5 minutes

Neil Rose, Editor of Legal Futures, March 09, 2020

Well, they got there in the end. On 27 February, the Ministry of Justice (MoJ) finally confirmed what everyone in the PI world knew had to happen and delayed implementation of the whiplash reforms, from 6 April to 1 August.

The scepticism had been growing for some months, but it was when the Civil Procedure Rule Committee did not even discuss the new rules at its February meeting that we knew the gig was up. But still the MoJ held the line that it was working towards April.

In his statement confirming the delay, Lord Chancellor Robert Buckland said there had been “major progress” towards implementation – although this is mainly thanks to the work of the Motor Insurers Bureau (MIB) rather than the MoJ – but continued: “The government has decided that more time is necessary to make sure the whiplash reform programme is fully ready for implementation. We have always been clear that we need to do this right rather than hastily.

“In particular, we need to provide sufficient time to work with the Civil Procedure Rule Committee to put in place the supporting rules and pre-action protocol and to give industry sufficient time to prepare their businesses for the changes to how small road traffic personal injury claims are managed. We will also lay the statutory instrument in Parliament to introduce the tariff of damages for whiplash injuries.”

There were two other elements to the announcement, one good, one not so good. The good news was that he confirmed that the increase in the small claims track limit would not apply to those who have been termed vulnerable road-users, such as motor-cyclists, cyclists and pedestrians, as well as children or protected parties – so they will continue with the current fast-track process.

However, the minister made it sound like this may not be a permanent position: “This will enable the government to test the processes and ensure that we have them correct before considering further extension.”

The bad news was that the MoJ has reneged on its promise to make provision for ADR where liability is disputed. “No practicable solution which gave sufficient coverage of ADR for claims could be found,” he said. “As a result, ADR will no longer be part of the online service. Instead, we will ensure access to justice by developing bespoke processes to enable litigants to go to court to establish liability.”

The reaction has been pretty uniform. Nobody – even the ABI – is decrying the delay, but some claimant voices are questioning whether five months will be enough. Paul Nicholls, chair of the Motor Accident Solicitors Society, said it was not very long “to make some key decisions on an informed basis and provide the necessary clarity on issues at the core of the claims process – multiple injuries, partial liability, sanctions, exclusions, payments, medical reports and others”.

But it is hard to see the MoJ being prepared to suffer the embarrassment of a second delay unless something goes catastrophically wrong.

The clarity on vulnerable and protected parties has also been welcomed, but ditching ADR has been widely condemned. Gordon Dalyell, president of the Association of Personal Injury Lawyers, said it treated injured people with contempt: “Failure to include an effective and fair way of resolving conflict in the new portal pits the inexperienced individual against the seasoned insurer without a safety net, hoping everything will go without a hitch.

“It assumes that the injured person will simply accept without question what the insurer says has happened, who is at fault, and how much compensation is fair. Or, if the injured person refuses to accept what he’s told, it is assumed he will be able to take his case to the small claims court. This means paying a fee upfront and facing down the lawyers of the person who has injured him, probably without being able to afford a lawyer of his own to help navigate a court system which is simply not designed to deal with these complex issues.”

Matthew Maxwell Scott, executive director of the Association of Consumer Support Organisations, said ministers “still have plenty of explaining to do”, with the portal not looking like “the sort of slick, modern claims process we were promised”, and there was a “high risk” of consumer detriment with the absence of ADR.

Can the small claims court cope with thousands of new cases? It is unlikely – the latest MoJ statistics show that it takes an average of 38.1 weeks for small claims to reach trial, a figure that is on the rise.

And, of course, the new portal will not link to the existing fast-track portal where claims turned out to be worth more than the small claims limit. Quite. Why would the MoJ want to do such a sensible thing? Litigants will at least receive a PDF of all the information that has been logged on the system, which could be annexed to any subsequent claim.

Another question unanswered thus far by the MoJ is how it is going to publicise the new regime. As Mr Maxwell Scott said, launching it during the summer holidays “feels a bit like burying bad news”.

And there is still so much more to do, even after the portal does go live. It will not cater for other heads of claim, such as the cost of credit hire and rehabilitation, meaning claimants will have to recover these losses separately. Of course, reforms to these were in part 2 of the MoJ’s whiplash reform consultation, which closed in January 2017.

Speaking in January at an event held by the Association of British Insurers. David Parkin, deputy director of civil justice and law policy at the MoJ, said he regretted having predicted a year ago that the government response to part 2 would be published by the end of 2019, and refused to give a new date.

He said the focus has been on the portal, and “once we have the space and the resource, we will move on to considering with ministers what we do with the second part of the whiplash reform programme”. Let’s not hold our breath.

X

It seems you are using an outdated browser.

This will impair your browsing experience around the web. Please visit one of the links below to update to a modern browser then re-open the site with the new browser.

Thank you


Our brand new industry white paper is coming soon

Be one of the first to receive a copy of the report, register your interest here.

By submitting an enquiry to First4Lawyers you agree to the terms and conditions of service outlined in our privacy policy

 
logo

Can't find what you are looking for?

We are open as normal during the Coronavirus lockdown and are able to help with all your legal needs.

Call us free of charge

0800 567 7866

Request a Callback

Continue browsing