Hit the road

The pre-action protocol for low-value personal injury claims in road traffic accidents is just over a year old. At present it only applies to personal injury claims between £1,000 and £10,000 arising out of accidents occurring on or after 30 April 2010, where liability is admitted.

It provides for a three-stage process which envisages most claims being resolved by the end of stage 2. Stage 1 involves sending the insurer a claim notification form (CNF) in form RTA 1 (with a copy in form RTA 2 direct to the insured). If the insurer does not respond within the required 15 days, denies liability, alleges contributory negligence (other than failure to wear a seat belt) or asserts that the information on the RTA 1 is inadequate, the claim falls out of the process.

If liability is admitted, the claim moves on to stage 2. A settlement pack is submitted, comprising the medical report, receipts or other evidence of special damages, receipts for disbursements and the claimant's valuation of the claim. There follows a 15-day 'response period' and a 20-day extendable 'negotiation period'.

Most claims should settle at stage 2 but, if not, proceedings are issued under CPR part 8 in accordance with the new PD8B. Before issuing, the claimant sends the defendant a copy of the court proceedings packs giving five days to check for accuracy. No new information or evidence can be included. The pack includes both parties' comments on the disputed heads of damage and both sides' final, and compulsory, part 36 offers.

There is an obligation on the defendant to then pay over the amount of the final offer. Once proceedings are issued, the court notifies the parties when the district judge will assess damages.

It is envisaged that the assessment of damages will be a paper exercise only.

However, either party can request an oral hearing. Such a hearing is confined to submissions only. No further evidence is allowed, it being the essence of the scheme that the court will have exactly the same information (and no more) as was put to the defendant's insurers. So, the judge will value the claim using only the same papers that the parties had. The procedure applies to children but not protected parties.

The perceived benefit of the scheme is that not only should claimants get compensation more quickly but solicitors' cash flow should be improved by the operation of a fixed-costs regime. This provides for a fixed sum to be paid at the end of each stage (£400 for stage 1, £800 for stage 2 and £250 for stage 3, plus a further £250 advocate's fee, if relevant). Disbursements can be added and, where appropriate, success fees (12.5 per cent for stages 1 and 2 and 100 per cent for stage 3) to cases funded under conditional fee agreements.

On the ground

A year ago the RTA insurance industry estimated that 500,000 cases a year would proceed through the new process. So, what's the experience on the ground? A quick straw poll on the Western Circuit revealed that some district judges had seen none of these, while others only very few. Perhaps this is because cases are, indeed, settling at stage 2, as hoped. There is a mixture of oral and paper hearings; and views vary about time estimates with listing times being given of between 30 and 60 minutes.

On 28 March, the government issued a paper, entitled Solving disputes in the county court. One of its proposals is to extend the scheme beyond its current limit of £10,000.

It seeks views as to a new financial threshold and whether a variation of the scheme should be introduced for employers' and public liability claims. The consultation closes on 30 June.

Pending a formal response from my association, the unanimous view on the ground appears to be that it is simply too soon to extend the scheme. Apocryphal reports indicate that the paperwork being seen on such disposals are worse than has been the previous experience on personal injury claims.

There are concerns as to the fairness of assessing damages on the basis of medical evidence alone, especially given the variable quality of such reports. It is difficult to assess on which side of the line a case falls with only medical evidence to guide the judge; a cautious approach might be adopted which may result in lower damages than the claimant deserves.

Such concerns are likely to be magnified the larger the claim is. And, the bigger the claim, the more appropriate it is to increase the allowable costs to enable proper investigations to be carried out. Neither should it be overlooked that, although damages are often relatively modest, employers' and public liability cases cover a wide variety of circumstances, are often complex and may, accordingly, be less susceptible to a blanket approach.

Perhaps if both sides of the 'industry' are enthusiastic about extending the scheme, including EL and PL cases, there may be some merit in doing so. If only one side is keen, it is certainly too early to contemplate any extension. So, excusing the pun, any extension must wait until the protocol has been properly road-tested.