More than a year on from the big go-live date and there are still plenty of developments to report in relation to the civil justice reforms. Hill Dickinson head of costs, Paul Edwards, reports on an upcoming rule change, some of the first case law considering the meaning of the fundamental dishonesty exception to qualified one way costs shifting (QOCS) and on his recent attendance at an open meeting for stakeholders on whiplash reform held by the Ministry of Justice.…

Buffer direction – amendment to CPR 3.8

Many practitioners (and their clients) will be pleased to hear that an update of the Civil Procedure Rules on 5 June 2014 will include a provision allowing parties to agree extensions of time of up to 28 days without needing to seek permission from the court. It is hoped that this will reduce the burden that dealing with such applications has placed on the court since the revised CPR came into effect last April. It will hopefully also restore practitioners’ ability to deal with such extensions in a common-sense manner, without incurring the time, cost and uncertainty of applying to the court in such scenarios.

The change will come into effect through an amendment of CPR 3.8. It specifies that where a rule, practice direction or order requires a party to do something by a specified time and specifies the consequences of failure to comply, the parties may - by prior written agreement - extend the time for compliance by up to 28 days.

However the ability to extend is qualified, the parties may only agree the extension provided that no hearing date is put at risk. Careful attention needs also to be paid to the need for agreement in writing – agreeing the extension orally will not do and there will need to be evidence that all parties have in fact agreed with each other.

Fundamental dishonesty – the ruling in Gosling -v- Screwfix

There has been a lack of clarity, ever since the revised CPR went live in April 2013, as to what exactly the QOCS exception where a party has behaved in a way which is ‘fundamentally dishonest’ will mean in practice. Would a claimant need to be found to have acted fraudulently? Or would something less than that - such as exaggeration - prove to be enough to attract the exception?

In what is understood to be the first indication of what this means, a circuit judge has ruled in a case in the Cambridge County Court that substantial exaggeration can amount to fundamental dishonesty exposing the claimant to costs. InGosling -v- Screwfix while the judge was satisfied that the claimant had suffered an injury as a result of an accident for which the defendant was liable, he considered that the claimant had significantly exaggerated the extent of his on-going symptoms such that the value of the claim was halved. Exaggeration was revealed through surveillance evidence.

Commenting on the significance of this decision, Hill Dickinson Counter Fraud Group partner, Stratos Gatzouris explains: ‘This is an interesting development and vindicates the view that I and others have held that the phrase ‘fundamentally dishonest’ was deliberately designed to include not just fraud (in the conventional sense) but also genuine claims where most of the claims had been made dishonestly such as in gross exaggeration cases.’

Upcoming reform – medical reports for whiplash

Further to what we explained in our article last week:

The Ministry of Justice has launched a short consultation seeking the views of ‘stakeholders’ on its proposals for whiplash reform: fixed costs for medical examinations/reports and related issues. Following that announcement, I attended a stakeholders meeting at the Ministry of Justice to participate in discussions considering the proposals in more detail. A range of attendees were present, from fellow defendant representatives and insurers to claimant representatives including those with interests in medical agencies.

 The following points were apparent from that meeting:

  • Reforms relevant to whiplash and motor claims are proceeding in two phases. The matters being dealt with in this consultation are phase one, and those to introduce accredited experts (seen as a vital component of the reforms overall) will follow as phase two.
  • Regardless of negative views from some about the concept of fixed medical report fees for whiplash claims, the scheme involving these will go ahead – the question is simply what the level of fees should be.
  • Some who were resistant to the fees proposed suggested that the MRO fees which have been successfully in place for a number of years could be used instead.
  • Others felt that the fees proposed, particularly for orthopaedic reports, are too high. The regime is intended to cover straightforward claims and any comparison with MRO fees is no longer appropriate because those were agreed at a time when referral fees were still permitted.
  • Whiplash claims will effectively have their own ‘stream’ within the portal, involving the fixed cost medical reports and restrictions on pre-med offers.
  • Most in attendance agreed that defendants providing their side of events to the medical expert was appropriate, however it is thought that this will be necessary in only a very small percentage of cases, for example those where the impact is alleged to have been extremely minor or where the speed of the collision is disputed.
  • The most contentious issue was the question of the independence of medical experts providing their report via a medical agency or intermediary, often linked to the claimant’s solicitor. Some claimant experts felt that the fact that both solicitors and medical experts are independent is enough to ensure independence. However, others, including some claimant representatives and I, expressed the view that it is perception that is important and this is why there needs to be a clearer separation / route to ensure that experts are seen to be completely independent from the parties.