Yesterday (Tuesday) the Justice Minister Lord Keen responded to the Justice select committee over the Government’s proposals to increase the small claims limit. If this goes ahead – which seems most likely – then the limit will increase to £2000 for Personal injury claims generally, and £5000 for “whiplash” claims.
The effect that will have on the person making a claim is that they will be unable to recover their legal costs if they win the case. So if they want to bring a claim they will be faced with the choice of footing the bill for legal fees themselves, or proceeding without advice.
To say I am extremely frustrated is a massive understatement. From the accounts I have read of today’s proceedings, it was apparent that the justice minister in question has no idea how the claims system works, what the advice sector does and how it is funded, what a claimant would need to know in order to pursue a claim, and what Claims Management companies do. These are things I would have though essential to his role. Despite being a lawyer himself (A QC with a background in commercial law, which probably goes some way to explaining his lack of understanding but certainly doesn’t excuse it) he appears to have a complete disregard for the value of evidence, which one would have thought was fundamental to a barrister’s role. Indeed one exchange apparently went as follows (with thanks and credit to John Hyde from the Law Society Gazette who faithfully reported this on Twitter)
“Keen: Many whiplash claims are fraudulent.
David Hanson MP: How many?
Keen: We don’t know.”
“Hanson: I want to leave this meeting knowing how many fraudulent claims there are.
Keen: You can’t make that calculation because of the way the claims industry is developing.
Hanson: That fact is your main driver of reform.
Keen: One can take an overall view.”
More can be read here: https://www.lawgazette.co.uk/news/justice-minister-backs-litigants-in-person-to-handle-pi-claims/5064369.article#commentsJump
At no point in any of the discussions about this issue, or the whiplash reforms generally, has anyone produced any evidence that claims are rising, that we have a “Compensation Culture” (which is entirely a media creation), nor produced any valid or logical reason why the law, which has been the law of the land since time immemorial, should just be ripped up and people’s rights should be trampled over by politicians, just because it would mean less claims. Note, there ARE fraudulent claims – the only evidence anyone has even produced in this whole process is that this amounts to 0.4% of all claims made. Stopping everyone claiming because of that is like shutting all shops because some people are shoplifters. Sledgehammers and their relationship with nuts, comes to mind.
Other than insurance companies and their shareholders, no-one wins here. Claimants will be faced with pursuing claims themselves without any knowledgeable or professional advice, at a time when they are often struggling, possibly in pain, maybe without any income, or unable to get about. They will no doubt accept offers of compensation which do not adequately recompense them, because they do not know otherwise and can’t get access to the advice that would help them.
Claimant lawyers will suffer, yes, in terms of income, and a lot of firms will end up making redundancies, which will affect the economy and the unemployment figures as well as the personal impact on those concerned. The court system, already on its knees, will struggle further due to the amount of unrepresented people trying to pursue claims, some of them unwarranted but without access to the professional advisors who would normally tell them “no” they won’t know differently.
Advice agencies, where Lord Keen seems to think everyone will be able to get help, will be overwhelmed with a volume of work they can not cope with, and have no funds to provide, and the people who have priority need for their services for debt and welfare advice will then suffer too, because they will be further down the queue.
Lord Keen has also mentioned an increase in Claims Management companies which he says would be a “good thing”. That’s the CMCs, folks, who ring you at all hours pestering you about accidents you haven’t had, who gave the lawyers the bad reputation in the first place, who buy and sell your details, and who have no professional or other qualifications whatsoever. Oh and they often buy your details from the insurance companies in the first place. There is no evidence that they would be able to do the job, and do it well, and in any event they’d certainly want paying, so all it would be doing is replacing one level of advice with another. What, I might ask, is the point of that?
The point of damages (compensation) is to put the claimant back in the position they would have been had the accident not taken place. It is not possible to mend broken bones or mental scars that quickly, so they are paid money instead to get them through it. We pay compulsory motor insurance so that people in those circumstances can get that help. That is what insurance is for. That seems to be commonly overlooked in this debate.
That is what frustrates me. The fact that no-one listens, the government seem hell-bent on change for change sake, when they should have far more important priorities; and the fact that all these points that politicians are making are based on NO EVIDENCE! None of this makes any sense to a logical or rational person who has the slightest idea how the system works and the rights that will be lost. Why can’t the people who know what happens and understand the system meet around a table, thrash this out and come up with a better system, if that’s what’s needed? Suggestions have already been made in this regard. The law should not be subject to politicians and their paymasters, but this seems to be what we are now reduced to.
And the saddest thing of all is that most of the general public won’t understand the effect on them and what they have lost, until they have an accident and look for help, which won’t be there. They’ll find out the hard way, when it’s too late.