John Cuss examines the key insights from our recent webinar, where recent changes as part of the whiplash reforms were discussed with industry leaders and experts.
The whiplash reforms are a package of measures poised to bring fundamental change to the way low-value personal injury claims from road traffic accidents (RTA) are formulated. Many of these reforms were first introduced by the Civil Liability Act 2018, along with a definition of whiplash and a fixed compensation tariff for whiplash injuries.
The second limb of the reforms will increase the small claims track limit for RTA claims – from £1,000 to £5,000 – for the injury element of the compensation. Claims captured by this new framework will be made through the Official Injury Claim online portal. After several delays, the ‘go live’ date for these reforms has been set for 31 May 2021.
Making a claim
Jayne Bowman, head of civil justice and law policy at the Ministry of Justice (MOJ) opened the webinar by reflecting on the progress of the reforms to date. It was revealed that the new Official Injury Claim portal is 98% complete, and that 35th ‘sprint’ had just been conducted. Bowman also highlighted the array of supporting material that the Motor Insurers Bureau would be making available, including e-shots on key topics, as well as making the new service available for training from 6 April 2021. Jayne made clear that there were still several key documents to be published, including the ‘Guide to Making a Claim’, the guides to Practice Direction 27B and Part 26, the standard directions, court forms, and details of the relevant court fees. During a Q&A session, Jayne advised that she expected the guides to be released in April.
Court forms for the new service unfortunately, Jayne explained, would need to be printed and posted to court initially, however, it was hoped that in the medium term, the service would be synchronised with the online court process.
The defendant representative perspective
The second session was led by Nigel Teasdale, former president and current executive committee member of the Forum of Insurance Lawyers (FOIL). Nigel provided some key insights and discussion points from the defendant representative perspective. He explained that he expects a significant degree of litigation as both claimants and defendants test the new rules.
Nigel felt key areas of litigation would be around reasonable belief as to value of the claim, minor psychological injuries – in respect of whether it is truly a minor impact psychologically, or something more – non-tariff injuries, credit hire, fraud and causation, the portal exiting process, litigation pathways and, finally, whether there were exceptional circumstances to justify up to an additional 20% to the tariff compensation amounts.
An insightful example was provided of a six-month whiplash injury, alongside a knee injury. Nigel explained that under the current regime, an offer may be made of around £2,500 combined for both injuries. However, under the new regime, the whiplash injury by the fixed tariff would attract an award of £495, whilst the knee injury, by reference to the Judicial College Guidelines, may attract an award of up to £2,300. Nigel surmised this may suggest an argument that the claimant may end up in relatively the same position under the new regime. It was concluded that such non-tariff injuries or the approach to valuing a combination of tariff and non-tariff injuries was likely to be the action area for disputes.
This is, of course, a much anticipated problematic element to the reforms – a warning on this was given in the introduction section to the 15th edition of the Judicial College Guidelines in November 2019.
Finally, Nigel applauded the recent collaboration seen from both sides of the industry, where initiatives have, for example, seen claimant and defendant representatives find common ground to agree protocols in response to the coronavirus (COVID-19) pandemic.
The claimant representative perspective
Next, Sam Elsby, president of the Association of Personal Injury Lawyers (APIL), provided an informative presentation from the claimant representative perspective. It was asserted, as I alluded to in my opening remarks, that whilst the reforms have been years in the making, they still seem rushed.
Sam provided some key practical tips for law firms in this arena, emphasising the importance of conducting historical analysis of your personal injury work to see how many claims would have been captured by the new regime and what financial impact that would have. Whilst many firms at the lower end of the market will still be grappling with whether it is viable to continue providing personal injury services, Sam did pose an important question – how do you truly know the claim value at the outset and can you really risk turning away these claims?
It was stressed that firms need to have clear signposting both for the benefit of their staff and prospective clients as to what claims they will take on and which they will not. Sam commented that, in his opinion, the vast majority of the public would be astonished by a “do-it yourself or lose a large portion of your damages” approach. He suggested that claimant firms should consider compliant onward referral arrangements if they were unable to service the claims.
Sam also questioned whether an unbundled legal services approach, such as providing limited assistance with key complex aspects of claims – for example, self-employed loss of earnings calculations – could be a way forward. It was, however, cautioned that unbundled services are often seen as a double-edged sword, with reduced fees and higher risk.
Finally, Sam concluded with some important advice on transparency of your funding arrangement with your clients, particularly following the judgment in Belsner v Cam Legal Services Ltd  EWHC 2755 (QB). He also questioned whether the Solicitors Regulation Authority (SRA) price transparency rules may be extended to this area of work.
The final part of the webinar was dedicated to a Q&A and discussion panel, with further industry leaders joining the panel, including:
Brett Dixon, chair of the Law Society Civil Justice Committee and Civil Procedure Rule Committee (CPRC) member
Matthew Maxwell-Scott, executive director of the Association of Consumer Support Organisations (ACSO)
Paul Nicholls, chairman of the Motor Accident Solicitors Society (MASS)
Lizzie Iron, head of service at Support Through Court, and
Richard Miller, head of justice at the Law Society.
There were some excellent discussion points in response to questions posed; Brett Dixon highlighted the separate significant changes to the overriding objective and new practice direction to support vulnerable parties. He also emphasised that we did not yet know how the new regime will interact with new vulnerability provisions.
Jayne Bowman was challenged around the governance framework for the new regime and, importantly, of transparency as to the data collected. She pointed out that there was a statutory requirement for a review of the reforms in three years and in the interim there will be a new governance committee, which would comprise representatives from both sides of the industry, as well as a CPRC member, to ensure alignment with the rules. Jayne also explained that, whilst no firm decisions have been made as to what data would be published, they understood clearly the need for transparency.
In respect of the earlier comments around funding arrangements, it was also stressed that the follow-up report anticipated on reform of damages-based agreements was now essential. It was suggested that this funding approach will be, perhaps, the framework best able to assist litigants in person, particularly in an unbundled way.
Only time will tell as to the full impact of the reforms – the Law Society remains committed to supporting practitioners in the personal injury arena.