30 October 2012Print This Post

Portal director spells out difficulties of EL/PL extension by April 2013

Bott: horizontal expansion is very different kettle of fish from vertical

There are significant difficulties with extending the RTA portal to cover employers’ and public liability (EL/PL) cases and the government should consider a staggered approach to roll-out that starts with the vertical move to higher-value traffic claims, a director of the company that runs the portal has said.

David Bott, one of four claimant representatives on PortalCo, also criticised the lack of a transparent process for deciding what fixed costs will be recoverable under the portal, and the impact that raising the small claims limit for personal injury could have on those fees.

Addressing an Association of Costs Lawyers conference in Manchester last week, Mr Bott – managing partner of Cheshire firm Bott & Co and immediate past president of the Association of Personal Injury Lawyers (APIL) – was critical of the Ministry of Justice’s commitment to April 2013 for extending the portal without considering the practical issues that arise, and also for apparently ignoring the “extremely prudent comments” of Professor Paul Fenn in his government-commissioned report into the first year of the portal, which cautioned that it was too early to extend.

Mr Bott said among the lessons learned from the first two and a half years of the portal was that it is important to have the rules of the new portals settled before they are built – only next spring will the portal finally comply with the pre-action protocol.

Though draft protocols for the extensions were recently sent to stakeholders, these will not be finalised for some time. He said: “I can see a world in which the protocol for the vertical extension is easy to integrate into the IT systems for April 2013. But I think a brand new protocol for the extension into EL and PL matters is a very different kettle of fish.

“It is a seriously big piece of work that would encapsulate some very disparate areas of law. So I wait with anticipation to see what comes out of the Civil Procedure Rule Committee and whether the April date is achievable.”

Mr Bott said other stumbling blocks are the absence of an equivalent to the MID search facility that enables claimant lawyers to make the claim against the correct insurer, the need for sufficient testing time, and the possibility that a new portal will need to be built from scratch.

“I am in the ‘do it right’, rather than the ‘do it quick’, camp. If that means starting from scratch and building something new, then all the delay in implementation will be made up later by not having to retrofit things at a later date…

“So I strongly urge the coalition government to take stock and at least consider staggering the extension of the portal to allow vertical extension prior to horizontal – and to take heed of APIL, of Professor Fenn and most importantly of the innocent claimant.”

On fees, Mr Bott observed that the current levels were the product of negotiation between the claimant and defendant lobbies, but this time “there are no stakeholder-led talks in the pipeline and the mechanism for deciding the new fees is entirely unknown”. He urged the ministry to engage with stakeholders and assess the fee by reference to how long the work takes, rather than on insurers’ costs.

He said the fee was worked out on the basis of how much work an average lawyer would have to do in order to do a provide a good service – “nowhere in any of the negotiations was there an amount added to take account of a referral fee”.

Suggestions from insurers that the basic fee should fall from £1,200 to anywhere between £150 and £400 would make the work “entirely unsustainable”, he claimed, adding that if the small claims limit does go up to £5,000, this would “effectively empty the portal of all its existing claims”, as 97% of claims which settle in the portal do so for less than £3,500.

“It is hard to renegotiate a fixed fee when it is unclear what the fee is for. Is it the current claims profile or is it for a future claims profile of cases with a value about £5,000? Will the government set a price for the cheaper claims, only for us to find that one year later this figure will only apply to more complex claims?” More generally he argued that “the small claims court is no place for the injured person”.

On other issues, he said the whiplash debate should focus on eliminating fraud, the start of which should be the government telling insurers to share the information they have with claimant lawyers. On the Jackson reforms, Mr Bott expressed “grave concerns” that the 10% increase in damages will ever be implemented or how it can be enforced.

“Ten per cent is not a sufficiently high figure for it to be obvious that the new settlement is any different from the offers that are currently being made. But even if you do believe that the 10% increase is achievable, it still leaves the more seriously injured, those in genuine need of help, severely prejudiced by these reforms.”

 

By Neil Rose

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