The Jackson Reforms 2013 e-update
Employer’s, Public and Products Liability
Mark Banks
July 2013
The Jackson Reform
1st April, 2013 saw the introduction of initial changes to the Civil Procedure Rules following
Lord Jackson’s proposals for Civil Justice Reform. 31st July 2013 saw the completion of the
implementation of those reforms.
These changes will affect the procedure for making a claim, the time-scales within which a
claim is to be managed, the way in which a claimant’s claim is funded and the amount in
costs which will be recoverable by the claimant from the defendant.
This document will provide information to ensure compliance with the new rules and also to
make the most of the changes to control claims spend and so improve a policyholder’s
claims history.
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The Jackson Reform – The Headlines
• As of 31st July 2013, the Claims Portal
goes live.
• Defendants cannot recover their defence
costs from an unsuccessful claimant
(QOCS).
• Hiscox have appointed preferred solicitors
to monitor the Claims Portal and deal
• ATE premiums and success fees are no
with applicable claims received.
longer recoverable as part of a costs
settlement.
• Speed is of the essence. Record accidents
immediately and report them to your
• Claims can be funded by BTE, ATE, CFA,
broker.
DBA arrangements.
• Investigation timescales have reduced;
• Interim payment requests will become very
we now have only 6 weeks for Employers
common within the Claims Portal.
Liability (EL) and 8 weeks for Public
• Claimants will present a Settlement Pack,
Liability (PL) to make a liability decision.
including an offer, once they have all their
• General Damages / PSLA payments will
evidence collated.
increase by 10%.
• There will be no more Letters of Claim on
• A claimants costs will be fixed within the
Fast-Track matters. A CNF or DCNF will
Claims Portal.
be used.
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Things for the Insured to do
• All accidents and alleged accidents must be recorded straight away and reported to the
broker.
• Retain all accident reports and associated documents / items (as set out below) for at least 3
½ years from the date of the accident.
• Upon receipt of a DCNF, an electronic acknowledgement should be sent in reply within 1
business day and the insurer advised immediately. Hiscox name and the policy number
should be given.
• The accident record should include HSE / RIDDOR / COSHH, identity of the injured party, a
narrative of circumstances, photographs, witness names and statements, CCTV, pre and
post accident risk assessments, system of working, training records, wages information
and any further relevant information.
• Advise Hiscox immediately of any concerns over validity or opinions on liability. With speed
being “of the essence” early admissions will be preferable – but only where appropriate.
IT WOULD BE IDEAL FOR AN INSURED TO NOMINATE AN
INSURANCE LIAISON TO ENSURE COMPLIANCE AND SPEED
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The Claims Process
• Most Fast-track Employers and Public Liability losses will be notified to Hiscox, via the
Claims Portal, using a CNF.
• Where the insurer is not known, the notification will be sent directly to the insured by DCNF.
• All notifications must be electronically acknowledged to the claimant within 1 business day.
• Decisions on liability are required within 30 working days for EL and 40 for PL.
• Wages information is required within 20 further working days.
• Once the claimant has submitted their Settlement Pack, there are up to 35 working days
within which settlement is to be agreed.
• Counter offers must be made within 15 working days of receipt of the Settlement Pack.
• If a claim is dealt with within the Claims Portal, lower Fixed Costs will be payable.
FAILURE TO MEET THESE MEASURES WILL RESULT
IN THE CLAIM LEAVING THE CLAIMS PORTAL
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Benefits
• The reform is good news for defendants. Whilst there is to be a 10% uplift in the value of
injuries, this will be offset by the restrictions in the costs recoverable by the claimant.
• Within the Portal:– Claims up to £10k in damages will attract costs of £900.00 + VAT & disbursements
– Claims between £10k & £25k will attract costs of £1600.00 + VAT & disbursements
– Pre-reform, such claims may have attracted costs of £5-10k plus.
• Outside the Portal:– ATE insurance premiums and success fees are not recoverable from the defendant
– Qualified One-way Costs Shifting (QOCS) will apply
– Claims will be funded either by CFA or DBA
– Claimant Costs will be fixed, but at a higher value - This position is illustrated in the
examples.
• To settle the claim within the portal will reduce claims spend considerably.
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Effect of Jackson on Claim Values
Pre Jackson
Reform
Low Value
£1k
- £10k
Fast
Track Personal
Injury Claim
General Damages
£5,000.00
£5,500.00
Special Damages
£1,000.00
£1,000.00
Costs
£6,000.00
£1,080.00
Disbursements
Total
£500.00
£12,500.00
£500.00
£8,080.00
Pre Jackson
Reform
Low Value
£10k - £25k
Fast Track
Personal Injury
Claim
includes 10% uplift
in PSLA award
£15,000.00
£16,500.00
Special Damages
£5,000.00
£5,000.00
Costs
£10,000.00
£1,920.00
Disbursements
Total
£1,000.00
£31,000.00
£1,000.00
£24,420.00
Post Jackson (non-portal)
£5,500.00
includes 10% uplift
in PSLA award
£1,000.00
£900 + VAT
£3,201.00
£1,855 + 12.5%
damages + VAT
£500.00
£10,201.00
Post Jackson (in portal)
General Damages
Pre Jackson
Reform
Multi Track
Personal Injury
Claim
Post Jackson (in portal)
includes 10% uplift
in PSLA award
Post Jackson (non-portal)
£16,500.00
includes 10% uplift
in PSLA award
£5,000.00
£1600 + VAT
Post Jackson (in portal)
£5,900.00
£1,000.00
£28,400.00
Post Jackson (non-portal)
General Damages
£100,000.00
£110,000.00
Special Damages
£20,000.00
£20,000.00
Costs
£50,000.00
Disbursements
Total
£5,000.00
£175,000.00
NOT APPLICABLE
£2,500 + 10%
damages + VAT
£30,000.00
includes 10% uplift
in PSLA award
hourly rate - but no
ATE or success fee
£5,000.00
£165,000.00
The above is illustrative only. Where a claim leaves the portal, costs
are broken down into 3 groups, £1k - £5k, £5k - £10k and £10k - £25k
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Process Diagram EL/PL Fast-track
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Glossary (1)
•
ATE – After The Event Insurance
•
– The insurance bought by a claimant to fund their
claim. The premium is no longer recoverable from
the defendant
•
BTE – Before The Event Insurance
– This is the mechanism by which new claims are
notified via The Claims Portal.
•
– A pre arranged policy taken out to fund possible
future claims – often attached to a home or motor
policy
•
CFA – Conditional Fee Agreement
– “No Win – No Fee”. A claimant does not pay their
solicitor’s fees if the claim is unsuccessful
•
•
•
•
Civil Procedure Rules – The CPR
The Claims Portal
– The IT system by which applicable claims are
notified and managed
DBA – Damages Based Agreements
– A mechanism for funding a claim, whereby a
claimant pays their solicitor a proportion of their
damages award as part of the solicitor’s fee.
Fast Track (personal injury values)
– The 2nd tier of claims under the CPR for damages
valued at between £1,000 and £25,000
– The rules introduced by Lord Woolf in 1999 and
updated in this reform by Lord Jackson, specific to
compensation claims process
•
COSHH – Control of Substances
Hazardous to Health Regulations 2002
– Incidents involving harmful substances must be
reported on a COSHH form
Civil Justice Reform
– Lord Jackson’s reform of the Civil Procedure Rules
CNF / DCNF – (Direct) Claims
Notification Form
– Small Claims Track - for claims less than £1,000
– Multi Track - for all claims over £25,000
•
Fixed Costs
– Within The Claims Portal a claimant solicitor can
recover only fixed costs from the defendant
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Glossary (2)
•
General Damages (also see PSLA)
•
– The compensation for the injury and other heads of
claim which are not able to be documented.
– Special Damages being those losses which are
specifically defined such as cost of past care or lost
earnings.
•
•
– All accidents / incidents where injury either
occurred or could have occurred are reportable to
the HSE under this regulation. A copy of the
reporting form should be retained
HSE – The Health and Safety Executive
– The Government body specifically concerned with
H&S at work and in public places
•
PSLA - Pain Suffering & Loss of Amenity
– The Injury element of the General Damages
•
QOCS – Qualified One-way Costs Shifting
– Where a CFA was entered into after 1st April 2013,
QOCS applies. This means that a defendant
cannot recover their defence costs from the other
side if they succeed in their defence – this is the
balance to the claimant not being able to recover
ATE premiums or success fees.
–
Settlement Pack
– Once an admission of liability is made in The
Claims Portal, the claimant solicitor presents all the
information required to document their client’s
claim.
Letter(s) of Claim
– Under the previous rules, a claim was formally
presented by way of such a letter, setting out the
details and the allegations. This is now replaced by
the CNF / DCNF
•
RIDDOR – Reporting of Injuries
Diseases & Dangerous Occurrences
Regulations 1995
– Medical report(s), specialist legal advice, evidence
of Special Damages, witness statements and most
importantly the value of the offer to settle
•
Wages Information
– On EL cases, the insured needs to provide the
insurer with details of 13 weeks pre accident
earnings for the claimant (net of NI & Tax) and also
details of all wage payments made subsequently,
covering any periods of absence related to the
accident and the injury suffered
There are some exceptions, such as fraud cases
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