Twenty Second Report Contents

Civil Liability Bill [HL]

1.This 12-clause Bill, relating to whiplash claims and the personal injury discount rate, was introduced in the House of Lords on 13 March 2018. The Bill has two main purposes:

The Ministry of Justice has provided a Delegated Powers Memorandum.1

2.The Bill’s main provisions are found in clauses 1–8, all of which contain delegated powers. We are becoming very familiar with skeletal bills.2 By any standards, the Bill is skeletal. Most of it is concerned with reducing the damages that the courts currently award for certain types of whiplash injury. Two central questions are:

(a)What is meant by “whiplash injury”?

(b)By how much are awards of damages to be reduced?

3.The answers are:

(a)“Whiplash injury” means whatever the Lord Chancellor says it will mean, in regulations to be made by him or her at some future date.3 Clause 1(1) has a partial definition but a full definition awaits the making of regulations by the Lord Chancellor, which will only happen once the Bill has been enacted. Given the complex physical and psychological components of whiplash injury, it is not satisfactory that these matters should be left to regulations rather than being subject to a rigorous debate in Parliament.

(b)The reduction in damages will be whatever the Lord Chancellor says it will be, in regulations to be made by him or her at some future date.4

4.We agree with the Motor Accident Solicitors Society which, in a letter to the Committee dated 16 April 2018,5 said that the extensive use of delegated powers in this short Bill “will severely limit parliamentary scrutiny as the full impact of the proposed measures cannot be determined without consideration of the proposed regulations/secondary legislation. The devil is very much in the detail”.

5.We draw attention to two clauses: clause 1 (meaning of whiplash injury) and clause 2 (damages for whiplash injuries).

Clause 1—meaning of “whiplash injury”

6.To the question “what is meant by whiplash injury?” clause 1 provides an opaque answer:

“(1) In this Part “whiplash injury” means an injury, or set of injuries, of soft tissue in the neck, back or shoulder that is of a description specified in regulations made by the Lord Chancellor”.

7.In other words, regulations will supply the answer in due course. The Government’s justification for putting the definition into regulations is found at paragraph 10 of the Delegated Powers Memorandum.

8.We agree with these propositions. But it does not follow from them that the definition of “whiplash injury” should be contained in regulations rather than the Bill. Neither the Lord Chancellor nor the Ministry of Justice is best placed to make this determination, which depends on medical expertise and clinical judgment.

9.We take the view that it would be an inappropriate delegation of power for “whiplash injury”, a concept central to a full understanding of the Bill, to be defined in regulations made by Ministers rather than being defined on the face of the Bill.

Clause 2—damages for whiplash injury

10.Just as clause 1(1) leaves “whiplash injury” to be defined in regulations made by the Lord Chancellor, clause 2(2) limits the power of the courts to award damages. The limitation will take the form of a tariff to be set in regulations made by the Lord Chancellor.

11.The Government justify this power6 because setting compensation requires review from time to time, for several reasons:

(a)To make reasonable allowance for inflation.

(b)Damages for pain, suffering and loss of amenity (“PSLA”) are not capable of precise quantification.

(c)Flexibility is needed to reflect possible changes in society’s perception of the value of PSLA over time.

(d)There is a possible “need to change the parameters of the categories of the tariff to adjust or refine the approach to different severities of injury should this become necessary in future and in the light of experience over time”.

12.We are not convinced by these reasons:

(a)Merely because a figure or a mechanism needs updating from time to time does not mean that it should not initially appear in primary legislation.

(b)Even if damages for PSLA are not capable of precise quantification, their quantification is not rendered easier merely because the choice of legislative vehicle is a statutory instrument rather than an Act of Parliament.

(c)“Society’s perception of the value of PSLA over time” is just that: something that changes over time rather than overnight. Slower changes can be accommodated by a new Act of Parliament.7

(d)The need to refine the tariff in relation to different severities of injury is a matter that can be dealt with by Parliament. There is a distinct advantage to this being dealt with by Parliament. Bills are amendable during their passage; statutory instruments are not.

(e)We are not convinced that the Lord Chancellor will make a better job of this than the judges, who have had decades of experience dealing with damages for personal injury at the bar and on the bench. Our judgment is shared by the Motor Accident Solicitors Society’s letter of 16 April. We also agree with the Society that it is not appropriate for the Lord Chancellor to be granted powers to make provision for damages relating to “minor psychological injuries” occasioned by the whiplash injury. If this is not to be determined by the judges, it would be better determined by independent medical experts rather than by Government.

13.In our view it would be an inappropriate delegation of power for damages for whiplash injury to be set in a tariff made by Ministerial regulations rather than on the face of the Bill. The tariff should be set out on the face of the Bill, albeit amendable by affirmative statutory instrument.

1 Ministry of Justice, Civil Liability Bill [HL] Delegated Powers Memorandum

2 Since January 2018 they have included: (a) The European Union (Withdrawal) Bill, which involves the largest peace-time transfer of power from Parliament to Ministers in our history. (b) The Taxation (Cross-border) Trade Bill gives to Ministers well over 150 separate powers to make tax law binding on individuals and businesses. (c) The Haulage Permits and Trailer Registration Bill contains 24 clauses, of which 16 contain delegated powers, and the first five all begin: “Regulations may”. See further the Committee’s 11th, 12th and 15th Reports of Session 2017–19.

3 Clause 1(1).

4 Clause 2(2).

6 Paragraph 14 of the Delegated Powers Memorandum.

7 In the context of the changes made by clause 8 to the Lord Chancellor’s power under the Damages Act 1996 to set a revised personal injury discount rate, the Government note (at paragraph 12 of the Explanatory Notes to the Bill) that the Lord Chancellor’s power has only been exercised twice: in 2001 and 2017.

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