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Lord Skelmersdale: I do not know who advised the Minister to produce that answer, but clearly whoever it was has not read behind the amendment but has taken my leaving out subsection (2) as gospel and my ultimate intention, which, as I explained in my opening remarks, it was not. However, I do not think that we shall get any further tonight. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 148 agreed to.

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Clause 149 [Information contained in certificates]:

Lord Skelmersdale moved Amendment No. 422:

    Page 68, line 17, at end insert—

"( ) A certificate must specify the rights of the person to whom it is issued to have the certificate reviewed under section 152 or to appeal under sections 153 to 155."

The noble Lord said: Amendment No. 422, which states,

    "Page 68, line 17, at end insert—"

might be better encompassed, I must confess, in subsection (5). Be that as it may, I trust that I can have a commitment that a standard part of the certificate will tell the recipient of his rights, especially of appeal, and obligations in respect of NHS charges. That is important at the beginning of the scheme anyway for insurance companies that have never offered motor insurance and, permanently, where individuals—as I think we have just established—in rare cases are sent the certificates. I beg to move.

Lord Warner: It is already the case that this information is included on every certificate issued in respect of the existing road traffic scheme. I can also offer the noble Lord the same assurances that it is fully intended that the new certificate for the extended scheme will also include information on review and appeal procedures. Indeed, the early design work on the certificate already does so.

Lord Skelmersdale: For the first time in my discussions on this part of the Bill, I accept the words that the Minister uttered with glee, happiness and appropriate respect, for which I thank him. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 423 had been withdrawn from the Marshalled List.]

Lord Hunt of Wirral moved Amendment No. 423A:

    Page 68, line 31, leave out from "which" to end of line 32 and insert "the parties to an action either commenced or contemplated before a court in England and Wales or Northern Ireland have reached an agreement in writing"

The noble Lord said: Amendment No. 423A is intended, along with a similar amendment to Clause 152, to enable the procedures set up to be followed without the necessity of a court order. The point I seek to make most strongly in reference to the amendment is that the vast majority of claims settle without the need for court proceedings, and the current proposal to limit adjustment to those cases where the court has made an order risks either the growth of litigation for a satellite purpose or fails to achieve the desired objective of adjustment.

As the Minister pointed out to me in his letter, to which I shall refer shortly, the present wording in the Bill does not require a formal decision of the court, but it does require a consent order. When I made the Minister aware of my concerns by sending him a copy of my speaking notes—no doubt we shall discuss this

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in more detail, but I felt that I had to put on the record the arguments on either side; it may be that there is insufficient time to go over this matter again on Report—he responded by stating that:

    "I understand the argument that by requiring formal endorsement of the agreement through a court process we may encourage compensators to take a case to court that they might otherwise settle informally. But in actual fact, a compensator would not need to go through a full court hearing to get an agreed order which would meet the requirements of clause 149(3)(d), and could be used for the purposes of calculating NHS costs".

The main point I wish to make to the Minister is that we have moved on in civil litigation as a result of the reforms introduced by successive Lord Chancellors. There has been a wish to see matters of this nature settled without the need for court proceedings. Indeed, we now have wide-ranging pre-action protocols which are designed to ensure that matters can be resolved without the expense of court proceedings at any stage.

There is also an element of encouragement on the part of the Government towards what is known as ADR, alternative dispute resolution. I hope, therefore, that the Minister would accept that by requiring there to be court proceedings, the department in which he is a Minister is moving in precisely the opposite direction from that of the Department for Constitutional Affairs and the reforms of successive Lord Chancellors. Surely there must be a way to reach an agreement—and I am not talking about something on the back of an envelope—of the kind that is reached in the overwhelming majority of cases so that the expense of involving the court is not required at any stage.

My final question to the Minister is that, in the alternative dispute resolution procedure, a mediator is often involved. That mediator sets out the agreement which has been reached between the parties and the whole purpose of the alternative dispute procedure is to avoid court proceedings. Is the Minister really suggesting that all that should be swept aside and, in order for this provision to operate, there has to be a consent order? You cannot have a consent order without proceedings having been commenced, and therefore after the alternative dispute resolution procedure had been followed, we would then have to go through the very procedure that ADR is designed to avoid; namely, court proceedings. I beg to move.

2 a.m.

Lord Warner: This is a complex issue and the Government thought long and hard about the best way to deal with it. The Department of Health certainly does not intend unnecessarily to push cases through the civil courts. We decided eventually that only where the decision on the extent of contributory negligence had been formally considered through one of the processes identified in the Bill should it be possible to reduce the amount of NHS costs payable.

The important point is to ensure that all the relevant issues have been properly considered in an appropriate forum, or where contributory negligence

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is specified in an agreed judgment or order, so that the rights and responsibilities of both sides are protected. Often the kind of agreement suggested by the noble Lord can be, with great respect, little more than a back-of-the-envelope agreement which we could not be sure had fully taken into account all the issues.

I understand the argument that by requiring formal endorsement of the agreement through a court process we may encourage compensators to take a case to court that they might otherwise settle more informally and more quickly. However, it is not an argument which the Government fully accept.

For a start, the compensator does not need to go through a full court hearing to get an agreed order which would meet the requirements of Clause 149(3)(d) and could be used for the purposes of calculating NHS costs. That is certainly the legal advice I have received. Furthermore, in many cases it will not be worthwhile for a compensator to push a case to court solely in order to get a contributory negligence ruling for the purposes of NHS costs recovery. Even if the costs due have reached the cap, the costs attached to running the case may well exceed what might be saved in NHS costs recovery. So there are some constraints there.

I include this issue in the areas that I am very happy to discuss in detail with the noble Lord. In view of earlier comments, however, I thought that I should put the Government's current position on the record. I shall be happy to discuss the matter in more detail with the noble Lord when we meet.

Lord Skelmersdale: Before my noble friend decides what to do with the amendment, I recall that the issue of contributory negligence was the cause of a long battle on the 1989 Bill. The then government were planning on, and succeeded in, dropping it from the 1948 compromise in the previous Parliament, and no mention that I can find was made in the Bill which became the 1999 Act. Why have we suddenly got it now?

Lord Warner: I was otherwise engaged when that earlier legislation was going through and so I will have to look back at the arguments. I have set out the Government's position. If I can do anything more to clarify matters for the noble Lord, I shall write to him.

Lord Hunt of Wirral: In reply to my noble friend, I have always felt that it was an anomaly in the recoupment of NHS charges and benefits to require insurers to pay the full sum irrespective of any deduction for contributory negligence. That is where the Minister and I are in agreement. I greatly regret that I have to disagree with my noble friend.

The Minister used the phrase "back of the envelope" even though I had cautioned him against doing so. But the overwhelming majority of claims are now settled by agreement without the need for court proceedings. The whole purpose of the civil justice reforms and the pre-action protocols was to

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introduce a system whereby the expense of the nation was spared; where you did not have to commence proceedings but could reach agreement.

The present Lord Chief Justice, previously the Master of the Rolls, the noble and learned Lord, Lord Woolf, did the nation a great service when he removed from the courts the burden of having to commence court proceedings by setting down the procedures in pre-action protocols. This is not a back-of-the-envelope solution; it ensures that the nation does not have to bear the costs of court proceedings in a whole range of cases.

ADR—alternative dispute resolution—is certainly no back-of-the-envelope system. The mediator reaches a solution which often involves give and take—otherwise you would not need a mediator. In cases where people blame each other or there is a whole sequence of events which point the finger at the injured person as having been at least partially to blame for what occurred, the mediator comes in and reaches some kind of agreement.

The whole purpose of ADR is to be alternative—it is alternative dispute resolution. Alternative to what? To the court. But the Minister is trying to tell us that that is all "back of the envelope" stuff. Even though it is a tried and tested procedure, encouraged by the Department for Constitutional Affairs, it is to be regarded as inferior, although the whole panoply of civil justice reforms has been to demonstrate to those who are claiming compensation that it is not necessary to go through the court proceedings. You can reach an agreement which is cost-effective and good value for money for everyone concerned without having to commence court proceedings.

Again, the Minister has enticed me and tempted me into having further discussions. How could I refuse such an offer? I hope I have been able to persuade him, however, that there is surely a solution whereby non-back of the envelope settlements could be included in some way. That is not to try to introduce some inferior procedure but to recognise that the whole drift of civil justice reforms has been in the direction of enabling parties to reach settlement without taking up the time of the court. But in view of what the Minister has said, I welcome the opportunity of some further discussions and, in the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

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