Examination of Witnesses (Questions 40-51)
DISTRICT JUDGE
MICHAEL WALKER
AND DISTRICT
JUDGE DAVID
OLDHAM
6 DECEMBER 2005
Chairman: Our apologies. Dr Whitehead,
you can resume.
Q40 Dr Whitehead: I think I was halfway
through asking you a question about the claims that are settled
before a case ever reaches court and, perhaps even on anecdotal
evidence that you may have, whether or not that has been a feature
of the development of CFAs and there are ways in which that might
be considered. Perhaps in terms of whether or not, say, local
authorities decide to pursue weak claims rather than accept them
at face value, as has been suggested, one would anticipate the
number of claims might then rise again, for example.
District Judge Walker: As I said,
it is interesting looking at the experience of Knowsley Metropolitan
Borough Council. One member of the secretariat heard the same
presentation I did where they were faced with this very large
increase in claims that traditionally they might have considered
settling on the basis that the costs of settling were going to
be a lot less than the costs of investigating and defending. However,
they took the deliberate policy decision to defend the unmeritorious
cases and, as a result, have seen the number of claims notified
to them fall off considerably, I think from memory, from 1,700
a year at its peak down to 250, an enormous decrease in the number
of cases.
Q41 Dr Whitehead: These are cases
that appeared in front of a local authority prior to ever having
gone to court?
District Judge Walker: They were
claims notified to the local authority that traditionally, on
the whole, they would have settled, but they took the conscious
decision to fight those which they thought were unmeritorious.
Chairman, whilst you were voting, I just looked up some figures
which you might be interested in. The Compensation Recovery Unit
is part of the DWP and what it seeks to do is to recover benefits
which have been paid to claimants where those claimants subsequently
make a successful recovery. Of course, the advantage of those
figures is they accumulate data on all claims rather than just
those which are issued or tried in the courts. What they show
is over the period 2000 to 2005 there was an overall decrease
in the number of cases where there was a payment of 5.4%. But
the more interesting figures, I think, are in relation to the
number of cases notified to them: criminal negligence cases fell
by 34%; employers' liability cases have fallen by 20%; public
liability which is the slipping and tripping type of cases have
fallen by 7.5%; road traffic cases increased slightly by 0.3%,
so those figures show an interesting trend downwards. That is
a more significant trend downwards than the number of cases issued
compared with those which are settled by a claimant.
Q42 Dr Whitehead: When we discussed
the evidence concerning a previous report on the small claims
courts in this Committee, there was a suggestion examined that
the claims for personal injury could be raised. The discussion
at that particular time looked also at the question of how that
would work out in terms of the way claims would be put forward.
Do you think that that might be a disincentive for lawyers in
claims management companies pursuing small value claims that they
would hope that insurers would settle?
District Judge Walker: It would
certainly take away their financial interest in those cases because
if your own report of today was accepted and the personal injury
limit in small claims rose to £2,500, that would remove quite
a considerable number of cases, which at the moment are at the
low end of the fast track where solicitors can claim success fees
and the like. Clearly they would see a fall-off in business. Personally,
I do not think there would be any reduction in access to justice
because it would bring within the small claims track cases which,
on the whole, people would be able to bring themselves. That is
a road we went down two months ago.
Q43 Mr Khabra: In my constituency
I know there are cases of compensation claims by some of my constituents
against hospitals for neglect and there are similar sorts of cases
in the rest of the country. As you know, the Government is introducing
the NHS Redress Bill to establish a scheme to enable settlement
without the need to commence court proceedings of certain claims
which arise in connection with hospital services provided to patients
as part of the NHS, and the proposals in the NHS Redress Bill
and the Compensation Bill are both complementary. The question
is, what impact do you believe the NHS Redress Bill will have
on access to justice?
District Judge Oldham: From the
time the Chief Medical Officer made his report, we supported the
concept of a redress scheme; in fact he was suggesting two redress
schemes, this is the first one which is being pursued. I think
it has a number of potential advantages, not least of which is
that our understanding is that a very considerable number of patients
who do suffer some sort of incident want more than anything an
explanation and apology, not necessarily financial compensation,
and that has always been very hard to get. Of course, the scheme
that is now proposed under the NHS Redress Bill would incorporate
exactly that. It would be a provision for compensation in an appropriate
case. There would also be provision for some sort of ongoing care
or treatment if that was appropriate and there may well be a significant
number of cases which are worth less than £20,000. They are
still significant cases, of course, at that level where people
might well feel able to pursue a claim through a scheme such as
the NHS redress scheme, but in a situation where they might have
difficulty in getting a conditional fee agreement with the solicitor
and they may well equally have difficulty in getting Legal Aid.
Of course, the scheme does not prevent them subsequently, if they
wish, from taking proceedings if they are not able to get redress
through the scheme. At least it would enable them to have a system
which they could use as a first port of call, perhaps, to try
and get an explanation and an apology and, if appropriate, some
degree of compensation or further treatment. I think that is to
be welcomed.
Q44 Mr Khabra: What do you think
about the impact of this legislation on the number of cases coming
to the Department itself as claims? Would it make a difference
between what is the current situation and the future?
District Judge Oldham: I do not
have the specific statistics, but I understand that at the moment
the number of claims that are actually pursued is quite small.
I suspect it may well be that there would be a greater number
of claims pursued through the scheme because people would feel
that they were able to do that without having either to obtain
a conditional fee agreement or Legal Aid. Certainly initially
at least, I think it may be that there are more claims made, whether
that trend would continue or not, I do not know. The Bill provides
for the scheme to be closely monitored over a period and so it
would remain to be seen. Of course, we do not know the precise
detail of the scheme, whether it is intended to be provided by
regulations.
Q45 Mr Khabra: Are there any practical
ways that independent verification of the settlement can be conducted
without introducing undue cost into the process?
District Judge Oldham: Are you
speaking again of clinical negligence claims?
Q46 Mr Khabra: Yes.
District Judge Oldham: The scheme
intends that there will be provision for independent medical assessment
if that is felt to be necessary. Obviously it will depend on the
individual facts of the individual case, but at the moment a very
significant part of the cost of pursuing clinical negligence claims
is the obtaining of independent medical expert reports to decide
whether there is or is not a claim. I would hope that the scheme,
as it is envisaged, would enable a proper assessment to be undertaken
without, obviously, disproportionate costs. That is clearly the
intention of the scheme, to try and ensure there is such a scheme
to deal with these smaller claims without the need for legal proceedings
and without incurring disproportionate cost.
Q47 Mr Khabra: In a number of cases,
the number of claims will rise, will it have any budgetary implications
for the NHS?
District Judge Oldham: I am sure
it will. There will inevitably be some sort of resource implication
for those operating the scheme because they are going to have
to have processes in place to deal with complaints or investigations
that need to be made. There must be some form of resource implications
within the health service.
Q48 Barbara Keeley: This is just
a question I may have asked earlier, but I think it might be helpful
to ask you too. On the opposite side, obviously the number of
cases may rise, but in terms of the most vulnerable groups, I
think there is a fear that people who are less well informed might
in fact settle for a lesser amount outside the courts than they
would if their case had proceeded to the court. Do you think that
is a likely outcome or is that something people ought to be careful
about?
District Judge Walker: As I understand
it, the intention would be under the scheme that the claimant
would have access to independent legal advice throughout, so hopefully
the sort of fears that you have would not actually arise.
Q49 Barbara Keeley: Do you think
there are sufficient safeguards?
District Judge Walker: The devil
is always in the detail and we have not got the regulations yet.
As I understand it, that is certainly the Government's intention
and, if so, it would certainly be supported.
Q50 Chairman: Do you think the care
contract principle is one which could eventually apply much more
widely, and would judges be comfortable with putting in place
care for people who are very seriously injured rather than granting
vast capital sums, while making estimates as to how long people
are going to live?
District Judge Walker: In a more
general sense, if I could answer that question, what we have always
thought of as the idea of rehabilitation, namely that it is much
better someone gets back to good health quickly than have a larger
claim, must be right and I think that is now generally accepted
by everyone involved in claims from both the claimants' and defendants'
sides.
Q51 Chairman: What about claimants
whose injuries are permanent and very restricting indeed and therefore
need continuous care? At the moment, all you have to do is make
an assessment of what capital sum would be necessary to guarantee
their care over however long the court judges they are likely
to live, and we must assume most generously on that score.
District Judge Oldham: It is now
established the court has to look at the issue of periodical payments,
in other words paying for care periodically, fixing a sum which
would be index linked in some way per year for the care, which
is something that certainly the insurers like. In a case where
there is some doubt about the life expectancy, for instance, it
would mean insurers were not necessarily going to pay out a huge
capital sum when in fact the care might not be needed for as long
as it is estimated. Equally, for somebody who lived much longer
than their anticipated life expectancy, it would mean their payments
were secure. So that is already happening. It is now part of the
case management function that the court has to look, and certainly
trial judges have to look, at whether the cost of future care
should be dealt with by way of periodical payments rather than
by way of a lump sum.
Chairman: Thank you very much indeed.
I am sorry you have had such an interrupted afternoon and it therefore
has gone on longer than you might have expected it would, but
we are very grateful for your help. Thank you.
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