Written evidence submitted by The Law Society of England and Wales (WHI0006)

Introduction

1. The Law Society of England and Wales is the independent professional body that works globally to support and represent 220,000 solicitors, promoting the highest professional standards and the rule of law.

2. When the Civil Liability Act was being developed, the Law Society expressed firmly the view that drivers and passengers injured through no fault of their own would struggle to access justice.

3. We have closely monitored the data being released by Official Injury Claim (OIC) since the portal went live in May 2021.  Although we appreciate that there are different ways of interpreting the data, it appears that our initial concerns about access to justice were valid.

4. The Government argued that personal injury solicitors were not required to support injured parties who were submitting claims of this nature. Our interpretation of the data is that injured people still overwhelmingly seek out legal assistance for these claims, despite the increase in the small claims limit, in order to access the justice that they are entitled to. Over 90% of claims were represented, with three quarters of representation coming from law firms.[1]  

5. By their nature, personal injury claims and the complexity in attempting to value them has led to most claimants having to seek representation. The 64-page guidance document that accompanied the roll out of the portal shows the level of knowledge that is needed to support a claim.

6. We believe the data is clear that the role of personal injury solicitors remains crucial to claimants, who have continued to seek out the expertise and support of these specialist solicitors. 

7. There is still a clear need for legal expertise in these types of claims, and solicitors should be being paid fairly and reasonably for the work they do to support their injured clients.

What effect have the measures introduced within the whiplash reform programme had on the number of minor personal injury claims to date?

8. The data shows that the number of claims has decreased since the release of the OIC.  Even taking into account variations due to the Covid-19 pandemic, claim numbers are significantly lower than before the Civil Liability Act was passed and the OIC implemented, which is in line with the Government’s objectives.

9. We believe that there is likely to be a degree of survivor bias here. The OIC is only capturing data for claimants who choose to enter the system in the first place, and we do not know if those who choose not to enter into the system are doing so because they have been deterred from bringing a fraudulent claim or if they are genuinely injured through no fault of their own and have been put off by the new process. 

To what extent have these measures met the Government’s objective of reducing the cost of whiplash claims to the economy; and to what extent are any savings being passed on to motorists through lower insurance premiums?

10. The Government’s objective was to reduce fraudulent claims from being brought, and simplify the process for claimants, which in turn would theoretically reduce insurance premiums for drivers.  However, the overriding objective should have been to maintain access to justice for those injured. 

11. Anecdotally, we understand that insurance premiums are increasing in price.  While the insurance industry isn’t required to report on any effect that the reforms may have had on premiums until April 2024 at the earliest, we would suggest that any changes as a result of the whiplash reforms may end up being skewed by other socio-economic pressures. 

12. We would urge insurers to be as transparent as possible in reporting the effects on premiums, and, if possible, provide targeted evidence that relates specifically to OIC.

What have been the effects of raising the small claims track limit from £1,000 to £5,000; the ban on settling whiplash claims without medical evidence; and the fixed tariff of compensation for whiplash injuries that last up to 2 years?

13. The Law Society supported the ban on pre-medical settlements without medical reports as we saw it as a welcome step in reducing the number of fraudulent claims, and we believe that this is a sensible principle to apply to all personal injury claims. 

14. However, we have always been opposed to the establishment of a tariff for compensation for whiplash injuries and the raising of the small claims track (SCT) limit to £5,000 for these claims. 

15. We argued during the Act’s passage that an increase to the SCT in line with inflation was a far more appropriate measure and would lessen the effect the new fixed tariff would have on claimants. As it stands, the reforms have created a greater inequality of arms between accident victims and insurance companies, by restricting access to recoverable costs for legal representation.

16. We continue to be concerned that the tariffs themselves have been set far too low and do not represent adequate compensation for claimants, which may be an additional reason for a drop in claims being made. The effort involved in bringing a claim may far outweigh the damages available.

Why most claimants continue to use legal representation when using the online portal (90% since its launch)?

And

Whether the OIC portal is accessible and easy-to-use for claimants and/or their legal representatives?

17. This statistic is one of the most alarming consequences of the reforms. As noted in the impact assessment for the Civil Liability Act (para 5.78), the Government had assessed that “amendments to the RTA pre-action protocol should ensure there is a system in place [i.e. – the OIC] that makes it easier for claimants to proceed their claims without legal representation”. This clearly hasn’t materialised. 

18. While a minority of claimants will be able to use the portal unassisted, the very nature of personal injury claims and the complexity in attempting to value them, has inevitably led to most having to seek representation. The fact that a 64-page guidance document[2] accompanied the roll out of the portal shows the level of knowledge that is needed in order to progress a claim. Coupled with the fact that an unrepresented party is suffering a (likely painful) injury while attempting to seek redress, makes it unsurprising that expertise is being sought, even if it means a claimant being out of pocket as a result of that.

19. Furthermore, for causes of action resulting in more than one injured party, else claims that involve children or vulnerable road users, or other factors beyond a simple soft tissue injury, the claim can become exceedingly complex to define in the first instance. 

20. Even if a case is suitable for the OIC, a claimant may not be aware of that until they seek legal representation and thus it may be easier to retain that representation rather than use the portal unassisted.

21. Claimants have also been disadvantaged by not having a method of suitable ‘Alternative Dispute Resolution’ (ADR) to turn to when wanting to settle their case out of court. With the MoJ’s recent push for civil claims to settle as early as possible in the process, it is disappointing that the original intention for ADR to be incorporated into the portal was dropped. The result of this is that proceedings may have been issued that could have been avoided, or claimants have possibly accepted unduly low settlements because they do not know how to resolve issues outside the OIC.

How effective is the OIC portal in settling claims for mixed injury claims, which cannot be settled using the fixed tariff awards?

22. On the subject of mixed injuries, we commend the industry group that sought to advance test cases to the Court of Appeal. Although only a partial level of clarity has been achieved through these judgments, the situation highlights the consequences of the reforms that were specifically legislated for, and those that were not. 

23. An observation of note in the test cases was heard in Rabot v Hassam,[3] where the Master of the Rolls commented that “Parliament has legislated for the reduction of general damages for non-whiplash personal injuries in cases where whiplash injuries have been sustained, even though the statute does not appear specifically to be directed at non-whiplash cases.”

24. The Law Society would urge caution in any argument that may question the parliamentary scrutiny applied to the passage of the Civil Liability Act.

Any other issues in relation to the implementation of the whiplash reform programme and operation of the OIC to date

25. The OIC will inevitably be viewed as a model on which to base future digital justice reforms. The main takeaway from its rollout is that the end user should always be included in the development of a portal or online process from the very earliest stage, including in the development of legislative reform, not just technological reform.

26. Furthermore, consideration should always be given to a holistic approach to civil justice reforms. Portals such as the OIC should not be developed in isolation but should be integrated into court processes and existing technologies so that efficiencies can be maximised as much as possible, and updates made seamlessly. One example of this is the lack of Application Programming Interfaces (known as APIs) that haven’t been built into the OIC from the beginning. 

27. Claims that are unable to be resolved in the OIC and require transfer to either the existing MoJ Claims Portal, or the Courts, have needed rekeying of data entry, which not only has risks relating to duplication, but also is highly inefficient.

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