Market round up: March 2023

A ruling of District Judge Lumb in Oxford last November shone a light on the underbelly of the personal injury world and apparent collusion between claimant solicitors, medical agencies and medics.

He found that the claim arising from a low-speed car accident was fundamentally dishonest, saying the claimant “took a chance on bringing an opportunistic claim for damages”.

He continued: “It may be that her initial dishonesty was only in relation to whether she was injured or not and the extent of those injuries but she then found herself caught up in a business model that was being operated by others that she could not escape from and had to play her part in seeking to cover up the activities of others.”

Defendants are arguing that claims are being ‘layered’ with the cost of unnecessary or non-existent rehabilitation treatment to get them out of the Official Injury Claim portal (OIC) and into a costs-bearing regime – here, the claimant was advised to have 10 sessions of physiotherapy and 10 sessions of cognitive behavioural therapy. DWF, the defendant Aviva’s solicitors, detailed similar fact evidence of other accidents involving the same organisations with the same outcomes.

What is striking is that pointing out to the court patterns of behaviour like this now appears to be a tactic. As I highlighted in the last newsletter, the High Court last autumn refused a claimant firm’s bid to exclude evidence (again from DWF) showing that, of 372 claims submitted by the firm, 95% contained an allegation of psychological injuries, 67% of claimants were recommended for further psychological examination, and 68% of claimants served a psychological or psychiatric report.

DJ Lumb’s ruling is significant because, as I understand it, judges have hitherto been reluctant to call out practices like this, preferring instead to focus on the individual claim and rule it fundamentally dishonest. By going further like DJ Lumb did, the court opens up the possibility of wasted or non-party costs orders and a greater chance for the defendant to actually recover their costs.

Rulings like this may also pique the interest of the Solicitors Regulation Authority, which defendant solicitors believe is too slow to act.

Of course, the vast majority of claims are conducted professionally and raise no concerns of this nature, but the future of mixed injury claims in the OIC remain up in the air after the insurance industry decided to seek permission from the Supreme Court to appeal the Court of Appeal’s ruling on how to calculate them, having been denied by the court itself.

The fact that the Master of the Rolls dissented gives the Association of British Insurers hope but in the meantime thousands of claims stay in limbo.

Concerns with the OIC have filtered through to MPs, meanwhile. The justice select committee has launched an inquiry into how the Civil Liability Act reforms are working, including the impact on the number of claims and whether they ensure access to justice. It is currently going through the call for evidence stage and will then hold hearings.

I imagine the committee’s final report will contain a fair number of criticisms but the Ministry of Justice will plough on regardless. It has shown no sign of compromising and it is worth recalling that, back in 2018, the committee recommended that the then small claims limit of £1,000 be increased by inflation to £1,500, and not £5,000. That didn’t exactly derail the reform train.

Another call for evidence of note is on the discount rate as the Ministry of Justice prepares for next year’s full-scale review. It raised the prospect of replacing the single personal injury discount rate with a dual or multiple rates that could be calculated by duration, with different short-term and long-term rates, or by heads of loss, with different rates for future care and future earnings.

It is at times like these that the profession needs to engage with its representative bodies to help make strong and compelling cases. An inability to come together with one voice has long been a major weakness of claimant lawyers in particular, but it is never too late to start.