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Looking ahead

February 2015

An update on forthcoming cases, consultations and key developments, including:

- New appeals and judgments to watch out for
- Update on discount rate consultations
- Three bills we’ve been following receive Royal Assent
- New Civil Justice Council report on Online Dispute Resolution
- Update on CDM 2015
- Mesothelioma Payment Scheme tariff increase

Forthcoming cases

Supreme Court

Mesothelioma: insurance At the end of January, an increased panel of seven Justices of the Supreme Court reheard the case of International Energy Group v Zurich Insurance on whether, under an employers’ liability insurance policy, an insured is entitled to an indemnity from an insurer for the entirety of its outlay in respect of a claim brought against it for mesothelioma by an employee, or only a proportion of its outlay based on the period for which the insurer provided cover. Judgment is awaited.

Costs: additional liabilities The costs challenge in Coventry v Lawrence returned before a seven-Justice Supreme Court panel last week following Lord Neuberger’s comments in July that the respondents’ liability for costs under the recovery regime may be inconsistent with their right to a fair trial under Art. 6 ECHR. The Supreme Court had adjourned the issue to allow the government to intervene. Judgment is awaited.

Employers’ liability: vicarious liability The Supreme Court will hear the case of Mohamud v WM Morrison Supermarkets Plc in 2015. The claimant was assaulted by a Morrison’s employee and was unsuccessful in his claim both at first instance and in the Court of Appeal. Judgment is awaited See DWF update on CA decision

Professional negligence This month the Privy Council heard the case of Maharaj and Ors v Johnson and Ors (Trinidad and Tobago) in which the issue is when time starts to run for limitation purposes when a professional gives negligence advice.

Other Supreme Court cases: hearing details are awaited in the following cases where permission to appeal has been granted in recent months

  • The Mayor's Office for Policing and Crime v Mitsui Sumitomo Insurance Co (Europe) Ltd & Ors arising from the 2011 riots.

  • Thevarajah v Riordan & Ors on relief from sanctions

  • Cox v Ministry of Justice on vicarious liability

Court of Appeal

New Procedure: second actions and abuse of process In the last week Hardwicke Chambershas confirmed that the Court of Appeal has granted permission to appeal in Padley v CDI Anderselite Ltd. In granting permission Sharpe LJ said “…in my view the appeal raises an important point that merits consideration by the Court of Appeal, as to the correct approach post Mitchell and Denton to permitting a second action to proceed after an identical action has been struck out for failing to comply with an unless order, where no application for relief from sanctions in respect of that first action is made or pursued.” Read more in Hardwicke Chambers’ update

New Motor: credit hire Judgment is due to be handed down on 26 February following the Court of Appeal hearing last month in Stevens v Equity Syndicate Management Ltd in the second appeal concerning the judicial approach to calculating the basic hire rate (BHR) in a credit hire case.

Personal injury quantum: Ogden The Court of Appeal will hear Billett v Ministry of Defence on 30 June. This case concerns the assessment of a claim for future loss of earnings using the Ogden Tables. See DWF update on HC decision  

Motor insurance: EU obligations The DfT is appealing the High Court’s decision from June in Delaney v The Secretary of State for Transport in which the claimant was awarded Francovich damages on the basis that the exclusion of the MIB's liability to passengers known as the "crime exception" was in breach of EU obligations. The hearing took place last week and judgment has been reserved.

Part 36: withdrawal of offer In March the Court of Appeal will hear Evans v Royal Wolverhampton NHS Foundation Trust in which the defendant attempted to withdraw a Part 36 offer within the 21 day period for acceptance and a without-notice order permitting the defendant to do so was set aside.

Portal claims: direct offers The case of Gavin Edmondson v Haven Insurance will be heard by the Court of Appeal in a window between 23 March and 21 July. In August 2014 the High Court held that the insurer had not acted unlawfully when contacting claimants direct to make offers of settlement.

Consultations

New Court fees increase: government response on enhanced fees In December 2013 the MoJ consulted on proposals to increase court fees with the aim of the Court Service becoming self-funding. Proposals to increase fees to reflect the actual cost of providing the service went ahead last year. It was only in January that the government responded to the “enhanced fees” part of the consultation, announcing plans to increase fees for all claims valued at over £10,000 so that the court fee is 5% of the amount of the claim subject to a maximum fee of £10,000. Recently released minutes of the CPRC confirm that the changes are due to come into force in April 2015 but in the meantime, the Law Society has invited comments on the effects of the proposals and has been encouraging solicitors to lobby their local MPs. Read more in Simon Denyer’s in-depth analysis

The government’s further consultation in relation to proposals to increase application fees closes on 27 February 2015. This includes proposals to raise the fees for a general application in civil proceedings: to £100 for a consent application (from £50) and £255 for an application on notice (from £155). Read more 

New Scotland: draft personal injury bills Last month we reported that MSPs had launched consultations on two draft bills. The proposed Damages Claims (EU Directive on Safety and Health at Work) (Scotland) Bill looks to repeal s.69 of the Enterprise and Regulatory Reform Act. The consultation closes on 31 March. The proposed Recovery of Medical Costs for Asbestos Diseases (Scotland) Bill would enable NHS Scotland to recover the costs of care and treatment of victims of asbestos-related disease from compensators. The consultation closes on 30 March. Read more on the proposals in our update,

The following consultations are awaiting official responses:

Rehabilitation code: Following its call for views on the current Rehabilitation Code, the IUA-ABI Working Party announced late last year that it hopes to make available for consideration a draft of the revised Code in March 2015 with a view to publishing the final version by the end of June. Read more in our update Draft Rehabilitation Code to be published in spring 2015

Reform of the Riot Damages Act In response to the August 2011 riots and subsequent report by Neil Kinghan in September 2013, the Home Office held a consultation on proposed changes to the Riot (Damages) Act. A new bill would reform the existing 1886 Act, improving and modernising the way compensation is paid to individuals and businesses that experience losses or damage to property during riots. The main elements of the bill include the placing of a cap on payments to very large businesses and their insurers and the establishment of a Riot Claims Bureau to handle claims. The consultation closed on 1 August 2014 and the ABI published its response voicing concern over the proposals and arguing that state support for riot victims needs to be maintained not curtailed. See ABI press release. The government’s response is awaited.

Pre-action protocols As part of its ongoing work on updating the pre-action protocols last year the CPRC consulted on proposed changes to the pre-action protocols for personal injury, judicial review and debt claims. The Committee’s intention is for the revised protocols to come out as a group at the same time as a revised Pre-action Conduct Practice Direction.

New Discount rate consultations The first consultation on the methodology in setting the discount rate closed in October 2012 and the second, on the legal framework closed in May 2013. In August 2014 it was revealed that a panel of experts was to be appointed to prepare a report giving expert investment advice to assist with the review. The panel was initially expected to be appointed by 22 September but the MoJ has recently confirmed to us that the appointment process has taken longer than envisaged. The MoJ is clearly having difficulties in making suitable appointments and this may, at least in part, be due to their limited budget. It remains to be seen when an appointment will be made but it seems there is now no chance of any report before the election, even if the panel start work before then. The original timescale was clearly too optimistic, and even when the report is eventually ready, the Secretary of State of the new government will need time to consider it, so there may now be no decision until 2016.

Also on the horizon...

In a flurry of activity on 12 February three Bills we have been following closely received Royal Assent:

Social Action, Responsibility and Heroism Act 2015 This Bill was brought forward 'to provide that where a person acts heroically, responsibly or for the benefit of others, this will be taken into account by the courts'. It has been notable for the criticism and ridicule it received throughout the legislative process. At the moment there is no information on when the Act will be brought into force. Read more on the significance of the Act in Simon Denyer’s recent update.

Criminal Justice and Courts Act 2015 We had been following the progress of the clause which introduces a range of provisions where a claim for personal injury is found to be fundamentally dishonest, including dismissal of the whole claim. The Act also contains new rules against inducements to make personal injury claims and in the Lords these were amended to cover inducements offered through third parties. Again there is no information on when the Act will be brought into force although the section on fundamental dishonesty will not apply to proceedings issued before the section comes into force.

Insurance Act 2015: The Insurance Bill introduced to Parliament last July incorporated some, but not all of the proposals in the Law Commissions’ draft Insurance Contracts Bill and also made amendments to the Third Parties (Rights against Insurers) Act 2010, to enable it to be brought into force. Most of the Insurance Act is expected to be in force by autumn 2016 but the TP(RAI)A 2010 is expected to be in force by autumn 2015. Read more in our update The Insurance Act 2015 is here…or almost here 

New Online Dispute Resolution Last April the Civil Justice Council set up an advisory group to explore the role that Online Dispute Resolution (ODR) can play in resolving civil disputes valued at less than £25,000. On Monday (16 February) the group published its report in which the principal recommendation is for a new three tier internet-based court service. Tier One should provide Online Evaluation to help users evaluate their problems and understand the options available to them. Tier Two should provide Online Facilitation in which trained facilitators working online can review papers and help users through a mix of ADR and advisory techniques. Tier Three should provide Online Judges who will decide suitable cases on an online basis. The report recommends a formal pilot of ODR as soon as is practicable involving an agreed selection of types of dispute, with a view to full rollout in 2017.  Read more on the CJC’s dedicated online hub

New Whiplash reforms MedCo is now inviting registrations from claimant solicitors and insurers. A link to register is available on the MedCo website. Claimant representatives must declare any financial links to direct experts or MROs as defined in the user agreement, also available on the website.

The MoJ proposes that users will have two tiers of MRO to choose from: larger MROs capable of servicing high volumes of clients, and smaller, regionally based MROs capable of servicing a local market. The MoJ has set out its draft qualifying criteria for all MROs in a background note and has invited views by way of a short survey which closes on 20 February.

The minutes from the first MedCo board meeting on 21 January are also available on the website and include the identities of the MedCo directors. Find out more on the MedCo website

New Insurance fraud taskforce At the ABI Motor Conference in December, Secretary of State for Justice Chris Grayling announced the creation of a taskforce, led by former Law Commissioner David Hertzell, to consider the issue of insurance claims fraud. The taskforce was set up in January, an interim scoping report is due to be produced by March 2015 and a final report will be published by the end of 2015. Read more, including details of the members of the taskforce and recent minutes, on the government’s dedicated web page

Mesothelioma claims: government response to Justice Committee inquiry In December the Justice Select Committee published the government’s response to its July report. The government will not be ending the exemption in the application of LASPO provisions on recoverability to mesothelioma claims at this time. A further review of the likely effects of the funding reforms on mesothelioma claims will be carried out in due course. Read more in our update

New Mesothelioma Payment Scheme: increased tariff last week Minister for Work and Pensions, Mark Harper announced the government’s decision to increase the Diffuse Mesothelioma Payment Scheme tariff from 80% of average civil claims to 100%, for those diagnosed on or after 10 February. The government say this could mean an increase of up to £54,000 per person. See DWP press release and read Derek Adamson’s comments in the POST (subscription required) 

Deregulation Bill: self-employed – motor insurance - HMRC records A few provisions in this bill potentially have an impact on insurers. Clause 1 amends s.3 HSWA1974 to exempt the self-employed whose work activities pose no potential risk of harm to others from health and safety law (from Löfstedt). Clause 9 amends s.147 RTA 1988 so that delivery of the motor insurance certificate or security is no longer required for the policy or security to be legally effective and also removes the requirement for policyholders to return their certificate of insurance or security if a policy is cancelled mid-term. And clause 71 gives HMRC the power to disclose information in fatal claims without the need for a court order. This measure is designed in particular to improve the process of dealing with mesothelioma claims. Whilst waiting for this measure to go through Masters McLeod and Eastman have issued a practice note for the procedure to be used HMRC practice note (pdf). The bill completed its report stage in the House of Lords this month. It will have its Third Reading on 4 March when there will be a final chance to amend the bill. We continue to monitor its progress, which you can also follow here

New Construction (Design and Management) Regulations 2015 CDM 2015 will come into force on 6 April 2015 with transitional provisions in place between 6 April and 6 October 2015 in certain circumstances for projects starting before 6 April 2015. Read more in DWF’s update The implications of the new CDM Regulations 2015 for Commercial Clients, Designers and Contractors

Review of Part 36 offers Following the CPRC’s comprehensive review of Part 36, the 78th update to the CPR contains the amendments which will come into force on 6 April 2015.  The changes aim to simplify the rules as far as possible and address the issues which have arisen in the caselaw over the years. As expected the amendments address Part 36 offers in split trials, sunset clauses, counterclaims and offers which make no real concession. Read new Part 36 in Schedule 1 to The Civil Procedure (Amendment No. 8) Rules 2014

Civil Justice Council (CJC) to look at Damages Based Agreements revisions The government has asked the CJC to take a detailed look at some technical revisions to the regulations for DBAs. Notably though, and to the Lord Dyson’s disappointment, the government decided not to permit ‘hybrid’ DBAs. The latest development was in December when the CJC published the membership of its working group on DBAs (pdf)

Guideline hourly rates In July the Master of the Rolls announced his decision following the review of the guideline hourly rates and the main headline was that no changes to the actual rates themselves should be made at this time, because of fundamental shortcomings in the available evidence. The issue has been returned to the MoJ for further thought but it is difficult to know how they will take it forward given the imminent General Election. In a speech to the Professional Negligence Lawyers Association late last year Mr Justice Foskett indicated that a meeting was held in mid-October between the Master of the Rolls and representatives of the MoJ and the Law Society. The outcome of further consideration of the position is awaited.  Read the speech here

Contact

For further information please contact Alex Fusco, Professional Support Lawyer on 0161 603 5211.

By Alex Fusco

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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