Personal injury market insights – October 2019
A summary of key developments including an update on recent changes to civil justice reforms, a consultation on financial redress for in-care victims and survivors in Scotland and an update on the Law Commission's consultation on automated vehicles.
Civil justice reforms
A new discount rate in England and Wales is set at minus 0.25%
- On 15 July, the Lord Chancellor determined a new personal injury discount rate of minus 0.25% effective from 5 August 2019.
Related item: The new discount rate: a minus move
Whiplash reform update: consultation responses and target dates issues
- In July, the Justice Minister confirmed that the government is still considering the issues raised in part two of the consultation paper ‘Reforming the Soft Tissue Injury (whiplash) Claims Proces Part two focused on credit hire, early notification of claims, rehabilitation, and recoverability of disbursements. The Minister confirmed that it was their intention to publish a response by the end of the year.
- Also in July, Lord Keen confirmed that children and protected parties would be exempt from the small claims track increase for road traffic personal injury claims for now. Such claims will effectively remain in the fast track and be subject to the current fixed costs entitlement.
- On 5 September, the government published its response to the consultation on a revised medical reporting process for unrepresented claimants, confirming that it will extend the MedCo system to cover initial medical reports for all road traffic accident related personal injury claims under £5,000.
- Mid-November is the target date for public testing of the litigants-in-person portal that supports the whiplash reforms. Testing will continue through to the end of February 2020 with April 2020 remaining the target launch date for changes associated with the whiplash reform programme. We continue to remain sceptical of that date.
FCA – regulator calls on CMCs to improve advertising behaviours
- On 23 August, the Financial Conduct Authority issued a sharply-worded press release entitled ‘Claims Management Companies must raise advertising standards’, which begins with a summary of the rules which the regulator will apply when considering advertising material used by claims management companies.
Related item: The future of fraud part 4: industrialisation of claims
Flexible court hours pilot launched
A flexible operating hours pilot for civil and family courts began on 2 September to test whether using courtrooms outside the traditional hours of 10am to 4pm would offer better access to justice and to improve the efficient use of the buildings.
The pilots will run for six months and consist of late sittings (4.30pm to 7pm) involving both civil and family work at Manchester Civil Justice Centre and early (8am to 10:30am) and late sittings involving civil work only at the county court at Brentford.
The civil courts will hear small claims, housing possession claims, chancery applications, and part 8/stage 3 RTA applications.
Law Commission publish response to automated vehicles consultation
On 19 June, the results of the Law Commission of England and Wales and the Scottish Law Commissions’ joint preliminary consultation into the safe regulate of automated vehicles, was published. The results echo the importance of manufacturers working collaboratively with government and insurers on data management in the new driverless vehicles environment.
A second automated vehicles consultation is expected later this year, considering regulations in the provision of passenger services. The Law Commissions' aim is to provide a third consultation paper in 2020, drawing on responses to both papers “to formulate more detailed proposals on the way forward”, with a final report with recommendations to follow in 2021.
Contact: Rachel Moore
Scotland Civil Justice Reforms
Scotland discount rate will continue at minus 0.75%
On 30 September, the Government Actuary Department published their determination of the personal injury discount rate in Scotland, concluding that the discount rate should remain unchanged at minus 0.75%. Under The Damages (Investment Returns and Periodical Payments) (Scotland) Act 2019 this rate took effect on 1 October and is likely to prevail until reviewed in 5 years.
Related item: No change in Scotland’s discount rate is a minus move
Government responds to success fee agreement consultation
On 10 September, the Scottish Government published an analysis of the submissions it received to the consultation on regulations for success fee agreement. They are now in the process of finalising secondary legislation for these regulations, which they aim to put before the Scottish Parliament in October/November.
Proposed Mediation (Scotland) Bill
On 29 May, Margaret Mitchell MSP launched a consultation for a proposed Mediation (Scotland) Bill, which aims to introduce a process of court-initiated mediation that could require litigants to complete a questionnaire at the outset of a claim to determine whether the dispute was suitable for mediation. The aims of the proposal are to increase the use of mediation and to increase the consistency of mediation services. The consultation closed on 20 August 2019 and we await the outcome.
Consultation on financial redress for in-care victims and survivors in Scotland
On 2 September, the Scottish Government published a consultation on financial redress for in-care victims and survivors, which closes on 25 November.
The consultation proposes legislation for a scheme which would seek to sign up legacy in-care providers and “those who may bear responsibilities” for historic abuse. The consultation asks for views on a proposed waiver where victims and survivors could extinguish their right to future litigation in return for a final financial settlement. The proposed cut-off for historic abuse is December 1 2004 (when the then First Minister gave a public apology for historic in-care abuse).