Evidence submitted by the Association
of Personal Injury Lawyers (APIL)
The Association of Personal Injury Lawyers (APIL)
was set up 15 years ago to protect the rights of people injured
through negligence. Members comprise solicitors, barristers and
academics. Our campaigning activity leads to regular discussions
with the insurance industry, consumer groups, employers' representatives,
unions, the Government and other parliamentarians. APIL's work
aims to ensure that injured people gain full and fair redress
for their injuries.
The following response relates to the select
committee press release issued on 22 July 2005 entitled "Small
Claims Under Scrutiny".
INTRODUCTION
1. APIL believes that personal injury cases
have no place in the small claims court.
2. This is because in the small claims court
it is virtually impossible for claimants to recover the vast majority
of their costs—whether they win or lose the case. This is
unlike higher courts where costs (including the cost of a legal
representative) can be recovered if the case is won.
3. This means people bringing cases in the
small claims court are not usually in a position to secure legal
help.
4. This is problematic because personal
injury cases require a much greater legal knowledge than a faulty
appliance where the value of the claim can be easily established.
It is much more difficult to value, say, a broken arm than a broken
fridge, which is a problem for unrepresented claimants because
they do not know how much compensation they should argue for.
5. There is support for APIL's contention
that personal injury claimants are vulnerable in small claims
litigation. In research carried out for the DCA in 2002, Professor
John Baldwin stated:
"that he has for a number of years held
the view that the main problem or dilemma in expanding the scope
of the small claims procedure is that litigants, however passionately
they may feel about the legal rectitude of their position, need
legal advice before the hearing about the validity of their case
in law".[6]
He continued by saying that:
"[i]t is unrealistic in [my] view to expect
lay people to know how they should go about establishing the legal
basis of their case effectively at a court hearing unless they
are given some preliminary advice about how they should do so".[7]
6. APIL is extremely concerned that suggestions
that the small claims limit should be increased to £5,000
for personal injury cases could mean almost three quarters of
personal injury cases would fall within its remit, leaving more
people to bring cases without the benefit of legal representation.
Does the small claims court facilitate access
to justice?
7. APIL believes that the small claims court
impedes access to justice for personal injury cases.
8. A MORI survey,[8]
commissioned by APIL shows that:
— 64% of adults would be unlikely to
pursue a personal injury claim through the small claims court
without an independent solicitor helping them
— 73% of respondents would be unable
to work out the value of their claim without an independent solicitor
helping them
9. It follows that the lack of legal advice
in the small claims court acts as a disincentive for those with
low value cases seeking compensation which is rightfully theirs,
because a large proportion would not bring a legal case without
a solicitor.
10. The average claimant will know very
little, if anything at all, about putting together a personal
injury claim and we believe it is highly unjust that the onus
is on the injured person:
— to gather medical reports
— to present them properly in court
— and therefore to determine if the
defendant is liable
11. Most personal injury claims—including
those in the small claims court—are made against big business,
or an insured defendant, who (unlike the claimant) is almost always
legally represented. This tilts the playing field against the
claimant.
12. APIL considers it manifestly unjust
that injured people may be dissuaded in proceeding with their
claims because they do not have the legal expertise to represent
themselves, while defendants may take advantage of this lack of
knowledge to escape their obligations.
Does the small claims court work effectively and
efficiently for personal injury cases?
13. APIL believes that due to the lack of
funding for legal advice available for claimants in the small
claims court, it is neither effective nor efficient for those
bringing personal injury cases.
14. Proving negligence is more problematic
for an unrepresented claimant because there are frequently medical
problems which prevent an early assessment. For example, an accident
may have exacerbated a pre-existing condition causing the earlier
onset of symptoms which would have naturally occurred over time;
or the claimant may not recover as well as his doctor hopes; or
he may have symptoms which need to be further investigated.
15. The net effect of a non-legally trained
claimant attempting to carry out a legal task is that he may inadvertently
accept an offer from an insurer which is too low, and be under-compensated
as a result.
Should the small claims limit for personal injury
cases be raised?
16. The Better Regulation Task Force reported
to Government in 2004 about the compensation culture myth. One
of its recommendations was that research should be conducted with
a view to raising the limit in small claims cases with a personal
injury element from £1,000 to £5,000.
17. APIL is concerned that any attempt to
increase the limit in the small claims court to this level will
disenfranchise many injured people and deny them the compensation
which is rightly theirs.
18. As part of APIL's response to the Better
Regulation Taskforce report APIL carried out a survey of its members
to try to quantify the possible effect of raising the small claims
limit.[9]
19. The research showed that contrary to
popular belief the vast majority of personal injury cases are
not of a very high value. According to our survey 70% of personal
injury cases are valued at less than £5,000. This means that
the vast majority of claimants could end up representing themselves.
20. Our survey also showed that for cases
valued at up to £5,000, the difference between the first
offer made and the final settlement for the cases analysed was,
on average, almost £1,000. This represents an average increase
of around 50% from the first offer to the final settlement. This
suggests that if claimants were to accept the insurer's first
offer, without the aid of legal help, they could be dramatically
under compensated.
21. This supports up one of the other key
findings in the MORI survey, which was that 80% of respondents
were not confident that they would be offered the correct amount
of compensation by an insurer in the pre-court negotiations if
they did not have an independent solicitor helping them.
22. APIL believes that this research highlights
the need for legal advice in all personal injury cases as a way
to ensure that injured people receive the full compensation which
they are due. A copy of the full report can be provided upon request.
CONCLUSION
23. APIL believes that personal injury cases
have no place in the small claims court.
24. We also believe that allowing such cases
to be heard in the small claims court acts as a barrier to justice
for injured people.
25. The complexity involved in personal
injury cases, and the lack of funding for legal assistance in
the small claims court make it inefficient and ineffective for
personal injury cases.
26. If the limit were to be raised to £5,000
as suggested by the Better Regulation Taskforce, up to 70% of
personal injury claims would go through the small claims court.
The Association of Personal Injury Lawyers (APIL)
September 2005
6 Lay and Judicial Perspectives on the Expansion
of the Small Claims Regime Professor John Baldwin, Department
for Constitutional Affairs. Research Series No 08/02. September
2002. Page 45. Back
7
Ibid. Back
8
APIL commissioned MORI to carry out research between 3-7 February
2005. 2,283 adults were interviewed at 201 sample points across
the UK. Back
9
APIL's membership survey was carried out in early 2005. 782 completed,
or partially completed, surveys were completed. These surveys
contained quantitative data in respect of 2,274 settled cases
of personal injury, 2,242 of them with a final general damages
award below £5,000. Back
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