Is this the end for access to justice?

3rd February 2012

On the face of it, it seems to be an easy enough problem to understand and put right. Motor insurance, the insurance industry say, has become too expensive for some people over the past few years. This means, at best, that the majority of the population are paying too much for their motor insurance whilst already hard pressed in these difficult and austere times.

At worst, they argue, many otherwise law abiding citizens are deciding to chance their arm and drive their cars without any insurance. And the reason for this situation? Simple, say the insurance industry, far too much is being paid out in claims and solicitors' costs and if these claims and fees can be reduced there will be huge savings to the industry.

So there it is. A simple problem and a simple solution which the Government has completely bought into – lock, stock and barrel. If only life was ever that simple!

However, the Government's proposals going through Parliament at this very moment are so radical and wide ranging that they will trade one set of problems for another.

It is widely believed that these changes will lead to significant access-to-justice problems for many future accident victims who will be unable to bring a claim for compensation for injury and loss as they will lack the funds to bring a claim. With the abolition of recoverable success fees and insurance premiums, the vast majority of solicitors will no longer take on cases which are considered to be problematic or difficult on grounds of liability.

The Government will get its way. Claims will reduce significantly in number and the insurance industry will receive a huge windfall in saved payments.

But at what cost?

Thousands of accident victims prevented arbitrarily from gaining access to justice and a throwback to the grim days of the early 20th century when virtually no one brought a compensation claim.

And what will the insurers do with these savings? Pass them on to the public in reduced premiums or to their shareholders in increased dividends? What do you think?

A Christmas message from a personal injury solicitor

21st December 2011

As the country hurtles headlong towards Christmas and the streets are full of shoppers getting those last minute Christmas gifts and the pubs and restaurants are crammed with revellers enjoying a glass or two of Christmas cheer, it falls to the personal injury solicitor in me to offer a nudge of pre-emptive caution.

And I apologise if you believe you are without blame at this time and don't wish to have the patently obvious pointed out to you by a lawyer, but it is not just the police and the hospitals who pick up the pieces after a car accident involving a drink-driver.

Yes, the staff at many a personal injury solicitor's office will see the devastation caused by drivers who thought their perception was unhindered after consuming a glass or two of wine at the office Christmas do. And it is we who are charged with steering people, whose lives have been irrevocably altered because of another person's thoughtlessness, through the man-made necessity of fighting for compensation from insurers.

Christmas is a time for jubilation, not tragedy, so my message is simple – stay safe during this festive season, whether you're in a car or on the pavement, whether cooking turkey for an extended family or plugging an old set of Christmas lights into an electric socket.

I'm sorry if you are offended, but personal injury solicitors are not party poopers, we would just like you to stay safe this Yuletide.

And I wish you a merry Christmas and a happy New Year!

No more UK damages for holiday accident claimants

5th December 2011

In recent times if a holiday maker had been injured while travelling abroad, their holiday accident claim would be ruled upon using UK jurisdictional law and any subsequent compensation would reflect levels of damages awarded for similar personal injuries caused on British soil.

However, under Rome II, the European Union Regulation which aims to negate the conflict of applicable law between member states, anyone injured in a holiday accident which occurred after 11 January 2009 will now have their case heard under the law of the land where the incident took place. This would mean that compensation amounts could be significantly lower than under English and Welsh personal injury laws.

The move has been confirmed by senior judges in the European Court of Justice after a case was ruled upon on Thursday 17th November.

The court was hearing the case of a British man who had been injured in a car accident in south west France in summer 2007. He suffered two broken legs and brain damage as a result of the car crash.

Ordinarily, his claim would have been settled under English law, but at the time the case went to court the EU was attempting to initiate the use of Rome II and it was suggested that the claim should be settled under French law. French compensation levels would almost certainly have been lower than the British citizen would have been awarded under UK law. In this case, the holiday accident claimant will be awarded damages at UK levels.

However, the European Court of Justice has now ruled that Rome II will come into effect in cases where the accident occurred after January 2009, with cases being heard under the applicable law of the land in which the incident took place.

Figures from the foreign office revealed that between 2010 and 2011 around 3,750 British nationals were taken to hospital, later needing help from the consulate – Spanish holiday accidents and illness accounted for a large proportion of this figure (around a third), with hundreds more in Greece, France and Thailand.

Holiday accident claim lawyers are unhappy, however. They say that the European regulation is poorly drafted and that, ultimately, where personal injury awards are lower, the amounts will not reasonably cover British costs for rehabilitation and medical care.

It's no accident, claim the Tories, that Labour don't want referral fees banned

28th October 2011

Government Minister Jonathan Djanogly has gone on record accusing the Labour party of shameful racketeering in respect of their collection of third party referral fees to boost party coffers.

It has emerged that the Labour Party website directs supporters who have suffered a personal injury accident, such as a slip, trip, or whiplash accident, to an affiliated site known as Labour Legal Services. In turn, this site advises accident victims to seek personal injury compensation through a Derby firm of solicitors.

According to a note on the site, the law firm will pay a referral fee of £250 plus VAT to the Labour Party each time they are instructed to represent a claimant who comes to them through Labour Legal Services.

As widespread criticism of the payment of referral fees in personal injury claims has emerged, and the practice has been largely blamed for huge increases in the cost of car insurance, the Ministry of Justice recently announced plans to ban referral fees paid to insurers who pass on details of car crash victims to interested third parties.

Mr Djanogly told the Daily Mail, "It is no wonder that Labour won't fully back our proposals to abolish referral fees when they are exploiting the current system to fill their own party coffers at everyone else's expense.

"Hard-working people are paying the price for Labour's shameful insurance racket."

And when reports suggest that referral fees have added a total of £355,629 to party funds over the last decade it is easy to see why some say that it is the vested interested of Labour front benchers which have caused them to remain quiet over the issue of reform.

Finally, in an unexpected twist to this story, Jonathan Djanogly recently found himself embarrassed to have to disclose his family's financial interests in insurance companies and, consequently, a distinct conflict of interests which has forced him to stand down on this referral fee debate.

Referral fees by another name

21st October 2011

In this section I recently looked at Government proposals for reforms in the personal injury world. It seems finally they have lost the plot; assuming that they ever had a coherent plan in the first place.

The Law Society Gazette reports the Justice Minister, Jonathan Djangoly, as saying that he is content to see Claims Management Companies (CMCs) forge closer ties with solicitors once the referral fee ban in personal injury cases has been introduced. So, he plans to ban referral fees but allow them by another name.

One might be forgiven for asking the point of this legislation. Well now we know; it's cosmetic and political. All show and no substance.

In addition, the Justice Minister, in an astonishing demonstration of his naivety, states that he hopes the reforms will allow insurers to defend claims more readily and that from a Government perspective he encourages them to do so.

What world is this man living in? Insurers afraid to defend claims – I don't think so.

In a stroke he has recommended more litigation, which is precisely how we got in this mess in the first place and the reverse of what these reforms are meant to be achieve. No, I'm afraid the truth is out. These reforms are all about making the insurers more profitable and to hell with the rights of injured claimants.