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Update on when the Portal and fixed recoverable costs changes will happen

A quick update on Tuesday's message in light of further news coming out of this process. Its clearly a demanding task to fit together into a cogent plan how the incoming Portal changes should be brought in where part of the Portal is up and running already, and where there are various complicated aspects to these changes. We don't envy those who have the responsibility for this area in their task while they try to achieve fairness and clarity.

A little more information emerging from the process means that we can now tweak the thoughts we gave you on Tuesday in relation to the forthcoming RTA Portal changes. Even now, what we are saying here may not be the final word as the formal rules are still awaited, but it represents our best educated guess as to where this will end up.

Set out underneath therefore is the revised and updated section of Tuesday's message dealing with RTA claims. The changed parts are in italics. The other parts of Tuesday's message remain unchanged.

RTA claims

Cases submitted to the current £1-10k Portal pre 30 April or 1 May will continue under the current Portal protocol and current FRC regime (ie excluding the reductions to FRC recently announced) whether they remain in the Portal or subsequently drop out of the Portal before at least 31 July or 1 August. It may however be that the rules when drafted will provide that if these claims drop out of the Portal after 31 July or 1 August then this will be into the new FRC regime whether settled pre proceedings or after proceedings.

Cases submitted to the current £1-10k Portal after 30 April or 1 May but before 31 July or 1 August will be subject to the current Portal protocol (including therefore the current rules as to timing of the stage 1 costs payment), but also to the new FRC regime with its reduced costs while those claims remain in the Portal (so the amount of both the stage 1 and 2 costs will fall). However, if these cases drop out of the Portal before 31 July or 1 August then this will be into the current costs regime, including ordinary standard basis costs which are calculated using hourly rates for litigated cases on the fast track. The differential as to costs in these cases as between reduced FRC in the Portal, and ordinary standard basis costs for litigated costs on the fast track, will have increased, so there will be extra incentive for claimant lawyers to try where they can take advantage of the wording of the current Portal protocol to take these cases out of the Portal before 31 July or 1 August, in which case the lawyers will presumably move them towards litigation. If they drop out of the Portal after 31 July or 1 August then we expect that this will be into the new FRC regime with its reduced fees whether settled pre proceedings or after proceedings. Claimant lawyers therefore will be looking to submit new claims to the Portal as soon as they can to maximise the opportunities to be able to take claims out of the Portal, and will then be looking for reasons to actually take those claims out of the Portal before 31 July or 1 August  and probably into litigation. Insurers should anticipate those behaviours and be in a position to respond to them.

Cases submitted to the expanded £1-25k Portal after 31 July or 1 August will be subject to the new Portal protocol and the new FRC regime both inside the Portal and where they fall out of it. 

EL/PL claims

In the EL context its worth bearing in mind that while disease claims entering the Portal after 31 July or 1 August and settling in the portal will be subject to the new FRC, those disease claims entering the Portal after 31 July or 1 August but which then drop out of it will not be subject to the new FRC and therefore for the time being will drop into the current system of ordinary standard basis costs which are calculated using hourly rates, while the MoJ consider this area further.

Contact

For further information please contact Simon Denyer, Partner at simon.denyer@dwf.co.uk or call +44 161 604 1551 

This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information.

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