The Ministry of Justice has commenced its consultation on extending the fixed recoverable costs (FRC) regime in civil cases, proposing the introduction of a new process and FRC to noise induced hearing loss cases (NIHL) valued up to £25,000.

These processes and FRC are in accordance with the proposals made by the Civil Justice Council, endorsed by Lord Justice Jackson in his supplemental report of 2017.

The full consultation document can be found here.

Background

A report from the Association of British Insurers in 2015 indicating a large increase in NIHL claims with high and disproportionate costs, led the Government to commission the Civil Justice Council (CJC) to make proposals on:

  • Improving the handling of NIHL claims
  • A suitable regime of FRC for these claims

Lord Jackson's Supplemental Report in 2017 endorsed the CJC's working party's proposals and made further recommendations regarding trial advocacy fees.

Improving the handling of NIHL claims

Pre-litigation

The consultation proposes the introduction of a new pre-litigation process for straightforward NIHL claims; principally new letters of claim and response. These new documents would provide for certain mandatory actions by both claimants and defendant, which would be defined within an annexe to the existing Pre-Action Protocol for Disease and Illness Claims.

It would be a mandatory requirement for claimants to attach the following to their letter of claim:

  • An audiogram produced by a suitably experienced and approved provider
  • A schedule of employment from HMRC – to be obtained after the audiogram to avoid unnecessary work
  • Search results from the Employers' Liability Tracing Office (ELTO)

Medical evidence should be initially restricted to that of the audiologist. If liability is denied and litigation anticipated, the claimant would then be expected to obtain a report from an Ear, Nose and Throat (ENT) consultant.

The defendant's a letter of response would set out its position on breach of duty and meaningful information on its general position.

Pre-medical offers would be discouraged, but not prohibited.

The consultation seeks views on the content of the draft letters of claim and response – which can be found at Appendix B and C to the CJC report - and the proposed accompanying documents.

Post-litigation

Two recommendations for the post-litigation phase have been proposed:

  • Standard case management directions
  • Tighter controls on the criteria applied when listing such cases for separate trial of preliminary issues such as limitation.

The listing of preliminary issue trials in fast track cases would be discouraged, hence the tighter controls, but if such a trial is needed, FRC should apply.

The consultation seeks views on the contents of the proposed standard directions and the listing of separate preliminary trials.

Fixed recoverable costs

The following exceptions for the application of FRC in NIHL laims are proposed:

  • Claims valued at more than £25,000
  • Claims with more than three defendants
  • All military claims
  • Where the defendant:
    • Alleges the claimant's occupational hearing loss is de minimis
    • Requests a second audiogram
    • Requests further medical evidence
    • Or, the case is considered by either party to be a 'test case' (maybe those considered more complex, although yet to be defined)

Pre-litigation

Stage

1 defendant

2 defendants

3 defendants

2A - Liability admitted but papers not prepared to issue proceedings

£2,500

£3,000

£3,500

2B - Liability admitted and costs of preparing papers to issue

£3,000

£3,500

£4,000

3A - Liability not admitted and papers not prepared to issue proceedings

£3,500

£4,000

£4,500

3B - Liability not admitted but cost of preparing papers to issue

£4,000

£4,500

£5,000

  • A sum of £500 is included at Stage 2B and 3B for the preparation of papers.
  • Pre-action disclosure applications are excluded from the FRC regime.
  • The pre-litigation FRC cover the involvement of counsel. Post-litigation, use of counsel would be considered a disbursement

Post-litigation

Stage

1 defendant

2 defendants

3 defendants

L1 - Issue to allocation

£1,650

£1,980

£2,310

L2 - Post-allocation to listing

£1,656

£1,987

£2,318

L3 - Listing to trial

£1,881

£2,257

£2,633

Maximum costs payable - (3B+L1+L2+L3)

£9,187

£10,724

£12,261

  • Reasonable disbursements would be recoverable
  • A fee of £1,280 would be recoverable if it is necessary to restore a dissolved defendant company to the Register of Companies
  • A trial advocacy fee of £1,380 is proposed.

Next steps

The consultation will conclude on 6 June 2019, and a response to the consultation is due to be published three months thereafter