WOOLF 10 YEARS ON HAS IT WORKED Pre

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WOOLF 10 YEARS ON: HAS IT WORKED? • Pre Woolf situation • Aims •

WOOLF 10 YEARS ON: HAS IT WORKED? • Pre Woolf situation • Aims • Vision • Success to date? • DCA Proposals • Feedback • Potential Impact

PRE WOOLF: PERCEIVED INJUSTICES • Too expensive • Too slow • Too uncertain •

PRE WOOLF: PERCEIVED INJUSTICES • Too expensive • Too slow • Too uncertain • Too adversarial

AIMS OF WOOLF REFORMS • Fairness • Tighter Timeframes • To be understandable to

AIMS OF WOOLF REFORMS • Fairness • Tighter Timeframes • To be understandable to those who use them • Effective, adequately resourced and organised court service

WOOLF’S VISION • Litigation as a last resort • Reduced time scales • Costs

WOOLF’S VISION • Litigation as a last resort • Reduced time scales • Costs more affordable and predictable

HAS WOOLF’S VISION BEEN ACHIEVED? Avoiding Litigation County Court Claims Issued: 2, 245, 324

HAS WOOLF’S VISION BEEN ACHIEVED? Avoiding Litigation County Court Claims Issued: 2, 245, 324 in 1998 1, 870, 374 in 2005 High Court (QBD) Claims Issued: 142, 505 in 1996 15, 317 in 2005 HOWEVER…the number of bodily injury claims reported to UK motor insurers rose by 3% a year between 1996 and 2006

HAS WOOLF’S VISION BEEN ACHIEVED? Issue Fees Have largely increased in line with RPI

HAS WOOLF’S VISION BEEN ACHIEVED? Issue Fees Have largely increased in line with RPI HOWEVER… With effect from 1 October 2007, allocation fees have increased and hearing fees have been introduced.

HAS WOOLF’S VISION BEEN ACHIEVED? Legal Fees Bodily injury claims paid out by UK

HAS WOOLF’S VISION BEEN ACHIEVED? Legal Fees Bodily injury claims paid out by UK motor insurers: • Costs – up by 840% in 20 years • Total cost of claims - up by 9. 5% per year • Costs for claims over £ 5 million – up by 30% a year

HAS WOOLF’S VISION BEEN ACHIEVED? Solicitors’ Hourly Rates Central London rates for Grade 1

HAS WOOLF’S VISION BEEN ACHIEVED? Solicitors’ Hourly Rates Central London rates for Grade 1 fee earners: £ 260 per hour in 1999 £ 380 per hour in 2007 RPI for 2007 - £ 393. 97 Time from Issue to Trial 79 weeks in 1999 58 weeks in 2005

HAVE THE WOOLF REFORMS FULFILLED THEIR AIMS? Fairness? • Simplified litigation • Costs regime

HAVE THE WOOLF REFORMS FULFILLED THEIR AIMS? Fairness? • Simplified litigation • Costs regime – disadvantaged defendants? Reasonable Speed? • Disparity and quality of court listings and staff • Waiting times for interim hearings

HAVE THE WOOLF REFORMS FULFILLED THEIR AIMS? More understandable? • 45 th Edition of

HAVE THE WOOLF REFORMS FULFILLED THEIR AIMS? More understandable? • 45 th Edition of CPR • 30 statutory instruments Adequately resourced and organised? • No specialist judges or trial centres • Court service budget is limited

HAVE THE WOOLF REFORMS FULFILLED THEIR AIMS? Other Factors • Woolf reforms in isolation?

HAVE THE WOOLF REFORMS FULFILLED THEIR AIMS? Other Factors • Woolf reforms in isolation? • New costs regime • Lower discount rates • Revised Ogden Tables • JSB Guidelines

WINNERS AND LOSERS Claimants as winners: Claimants as losers: • Quicker settlement • Fewer

WINNERS AND LOSERS Claimants as winners: Claimants as losers: • Quicker settlement • Fewer “have a go”claims • Increased damages • Funding • More judicial control • No legal aid • Media/press • Compensation culture • Insurance premiums

WINNERS AND LOSERS Defendants as winners: Defendants as losers: • Judgements based on merit

WINNERS AND LOSERS Defendants as winners: Defendants as losers: • Judgements based on merit • Cost of claims • Disproportionate costs • Faster disposal of claims • Predictive costs

WINNERS AND LOSERS WINNERS LOSERS Claimants and their Court staff solicitors Judges Defendants and

WINNERS AND LOSERS WINNERS LOSERS Claimants and their Court staff solicitors Judges Defendants and their solicitors Insurers: Winners or Losers?

NEW DCA CONSULTATION Proposals: 1. Raising the Small Claims Limit 2. Raising the Fast

NEW DCA CONSULTATION Proposals: 1. Raising the Small Claims Limit 2. Raising the Fast Track Limited to £ 25, 000 3. Streamlining the personal injury claims process

STREAMLINING THE CLAIMS PROCESS The Proposals • Early notification • Standardised claim forms •

STREAMLINING THE CLAIMS PROCESS The Proposals • Early notification • Standardised claim forms • Moratorium on claimant solicitors investigations • Settlement packs • Standard damages / contributory negligence scenarios • Set timeframes throughout the process

STREAMLINING THE CLAIMS PROCESS Where quantum negotiations breakdown • Cases under £ 2, 500

STREAMLINING THE CLAIMS PROCESS Where quantum negotiations breakdown • Cases under £ 2, 500 referred to a District Judge to be resolved by paper hearing • Cases over £ 2, 500 to go through a simplified review process

STREAMLINING THE CLAIMS PROCESS Responses • Law Society – supports proposals for claims under

STREAMLINING THE CLAIMS PROCESS Responses • Law Society – supports proposals for claims under £ 5, 000 • APIL – proposals only suitable for RTA cases where liability is obvious and should only be used in cases less than £ 2, 500 • ABI – welcomes streamlined process and believes paper review for quantum should apply regardless of value

STREAMLINING THE CLAIMS PROCESS Cost Proposals • Fixed costs for each stage • Fixed

STREAMLINING THE CLAIMS PROCESS Cost Proposals • Fixed costs for each stage • Fixed success fees • No recovery of ATE premiums taken out at the commencement of the claim • Claimants only to recover costs where they beat their own offer on claims up to £ 2, 500

STREAMLINING THE CLAIMS PROCESS Law Society Response • Reject the notion of the claimant

STREAMLINING THE CLAIMS PROCESS Law Society Response • Reject the notion of the claimant having to beat their own offer to recover costs • Supports fixed costs • Concerned by the possible impact on ATE insurance

STREAMLINING THE CLAIMS PROCESS ABI’s Response • Supports staged fixed fees and success fees

STREAMLINING THE CLAIMS PROCESS ABI’s Response • Supports staged fixed fees and success fees • Supports removal of ATE where there is no risk APIL’s Response • Rejects lack of funding and low fixed fees • Concerned by impact on ATE market

STREAMLINING THE CLAIMS PROCESS CONCLUSION • Should value alone determine track allocation? Streamline process

STREAMLINING THE CLAIMS PROCESS CONCLUSION • Should value alone determine track allocation? Streamline process • Are timescales realistic? • How will claims departments react? • Settling claims regardless of merit? • Will fixed costs reflex cost of claims acquisition? • Opportunities for TPA’s? • New claim forms – “have a go” litigation?

STREAMLINING THE CLAIMS PROCESS CONCLUSION Costs and funding • At what level will costs

STREAMLINING THE CLAIMS PROCESS CONCLUSION Costs and funding • At what level will costs be set? • Effect on ATE market – final blow?