qbe technical claims brief march 2012

7/28/2019 QBE Technical Claims Brief March 2012

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Technical claims briefMoty updt M 2012


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Contents

News 1

Jackson reforms postponed 1

Former Autofocus staff face application

for committal for contempt of court 2

Reporting of Injuries, Diseases and

Dangerous Occurrences Regulations

(RIDDOR) relaxation comes into effect 3

Government issues response on civil

justice consultation 4

Costs 5

Early Part 36 offer effective:

SG (A Child...) v HK Hewett High Court

(2011) 5

Interest on costs must run from date

of costs order Simcoe v Jacuzzi UK

Group Ltd Court of Appeal (2012) 5

Road Traffic Accident widely defined

- Griffin v Wisbech Phab Club

Supreme Court Costs Office (2011) 6

Liability 7

Passenger injured in course of crime

unable to claim: Delaney v Pickett and

Tradewise Insurance

- Court of Appeal (2011) 7

Vicarious Liability for Assault at Work:Richard Waddell v Barchester Healthcare

Ltd and Wallbank v Wallbank Fox

Designs Ltd - Court of Appeal (2012) 8

Quantum 9

92 year old Mesothelioma victim receives

significant General Damages Award:

Dennis Ball v Secretary for Energy and

Climate Change High Court (2012) 9

Disclaimer 10


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T m , moty updt M 2012

1

News

Jackson reforms postponed

A Government Minister has announced

in the House of Lords that the

implementation of the Jackson reforms,

scheduled for October 2012, is to be

put back until April 2013. Lord Wallace

a Liberal Democrat peer and Advocate

General for Scotland, explained that the

Government wished to allow enoughtime to get the complex details right and

for legal businesses to prepare for the

changes.

The Government however, was said to

be still firmly committed to the reforms.

It has rejected all amendments to the

Legal Aid Sentencing and Punishing

of Offenders (LASPO) Bill despite strong

pressure from peers, especially on clauses

43 and 45 dealing with Success Fees and

After the Event (ATE) insurance premium

recoverability. Lord Wallace said that the

reforms once in force (in England and

Wales) would save the NHS Litigation

Authority (NHSLA) 50 million a year.

Several peers raised concerns that

Qualified One Way Costs Shifting

(QOCS) was to be introduced by the Civil

Procedure Rules Committee without any

statutory instrument that could be debated

by Parliament. QOCS would protect

claimants from having to pay a successful

defendants costs unless their behaviour

was unreasonable or they failed to beat

a costs protective settlement offer. Lord

Wallace recognised that the rules would be

difficult to frame and that there was a risk

of satellite litigation but assured the House

that the Government would continue to

consult widely with stakeholders once the

details of the LASPO Bill were finalised.

He also confirmed that the 10% uplift

in general damages (another part of the

Jackson reforms intended to compensate

claimants for the loss of ATE and Success

Fee recoverability) would apply to the

Statutory Bereavement Award.

Comment: Delay in implementation

of reforms will mean a delay in costs

savings for compensators. The avoidance

of satellite litigation is however an

understandable goal.

Currently all amendments to the Bill are

withdrawn but these can be reintroduced

and a vote called for later in the process.

Peers remain concerned that vulnerable

claimants such as mesothelioma victims

and the parents of brain-injured children

could lose up to 25% of their damages in

costs once the reforms are in place. The

reforms are likely to face further challenge

and possible delay.


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2

Former Autofocus staff faceapplication for committal forcontempt of court

The long running dispute over the

authenticity of evidence provided by

Autofocus on Basic Hire Rates (BHRs)

to the courts on behalf of the insurance

industry appears to be coming to a

head. The credit hire company Accident

Exchange Ltd (AEL) has been alleging for

almost three years that tainted reports

supplied by Autofocus in Road Traffic

Accident cases in England and Wales

have deprived them of recoveries of

between 20 million and 50 million from

defendants. The reports allegedly gave

unrealistically low rates.

In December of 2011, AEL persuaded the

Court of Appeal that there was sufficient

evidence of malpractice for an appeal tobe allowed out of time on four test cases.

Seven more test cases went before the

Court of Appeal on 16 February.

The most recent development at the time

of writing was the obtaining of permission

by AEL for an application to have seven

former Autofocus staff committed

for contempt of court. The Divisional

Court, which granted permission for the

application, ordered that evidence of

widespread perjury presented to the court

by AEL should be referred to the Attorney

General.

The response from insurers has been

mixed. Two insurers are reported to have

settled some 900 AEL cases out of court

and at least two others are reviewing

old cases. Other insurers maintain

that notwithstanding any defects with

Autofocus evidence their settlements were

on the whole, fair and reasonable.

Comment: It seems almost inevitable that

further credit hire claims will be re-opened.

The number of claims affected is uncertain

but estimates of over 18,000 have been

reported. The battle between motor

insurers and credit hirers continues.


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Reporting of Injuries,Diseases and DangerousOccurrences Regulations(RIDDOR) relaxation comes

into effect

With effect from 6 April 2012, the current

reporting trigger for people injured at work

of more than three days incapacity will be

increased to more than seven. Employers

will still need to keep a record of any

workplace accident where an employee is

incapacitated for more than three days but

need no longer report these accidents.

Employers will now have fifteen days in

which to report the accident to the relevant

enforcing authority (Health and Safety

Executive, local authority, Office of Rail

Regulation) as opposed to the previousten days.

A Health and Safety Executive guide to

the amended regulations can be viewed at

www.hse.gov.uk/pubns/indg453.pdf

Comment: The changes bring the

regulations into line with the obligation

of an employee to obtain a Fit Note from

their GP for absences of over seven days

(see April 2010 Brief) and follows oneof the recommendations for reduced

bureaucracy contained in Lord Youngs

report Common Sense Common Safety

(see November 2010 Brief).


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Government issues responseon civil justice consultation

The Ministry of Justice (MOJ) consultation

on reforming civil justice in England and

Wales Solving Disputes in the County

Courts closed at the end of June

last year. The consultation covered a

number of important areas for potential

reform including aspects of Lord Justice

Jacksons reforms of litigation funding. The

long awaited Government response was

finally issued on 9 February this year.

Key features are:

ExtensionoftheupperlimitoftheMOJ

scheme for dealing with low value

Road Traffic Accident injury claims

from 10,000 to 25,000 subject

to further evaluation of the existing

scheme

ExtensionoftheMOJschemeto

cover low value Employers and Public

Liability injury claims subject to further

consultation

Extensionofthefixedrecoverable

costs regime to cases of higher

value and across a broad range of

claim types again subject to further

consultation

IncreasingtheSmallClaimsTrack

upper limit to 10,000 with a further

increase to 15,000 after evaluation of

the effects of the increase to 10,000.

This will not apply to personal injury

claims

AllSmallTrackclaimstobe

automatically referred to the Small

Claims Mediation service. Parties to

the claim will be required to cooperate

with a mediator but will not be obliged

to go through the full mediationprocess.

No implementation dates or timescales

have been given for any of the proposed

changes in the response itself but a

covering e-mail said that the Government

would look to introduce the changes

through secondary legislation such as the

Civil Procedure rules by April 2013.

Comment: The response has been

criticised by some commentators as

indecisive and as a missed opportunity

to help deliver a more cost effective and

efficient claims process. Despite recent

statements from several Government

representatives (including the Prime

Minister) to the effect that the Government

remains firmly committed to reform of civil

litigation, the reform process appears to

be losing some momentum.


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Costs

Early Part 36 offer effective:SG (A Child...) v HK Hewett High Court (2011)

The court was asked to rule on the

claimants entitlement to costs following

his acceptance of a Part 36 offer over two

years after it was made. The offer hadbeen stated as being open for acceptance

for the usual 21 days but was not

withdrawn thereafter. The Claimant was a

minor with a brain injury and the settlement

was approved by the court.

The Claimants solicitors argued that

they could not have advised their client

to accept the offer at the time because

the available medical evidence did not

give a certain enough prognosis. The

Defendants case was that the offer

was sufficiently generous that despite

the uncertainty of the prognosis it was

reasonable for the claimant to be put at

risk on costs.

The Court held that the normal costs

consequences of Part 36 should apply.

The claimant would be responsible for the

defendants costs from the date of the

expiry of the normal acceptance period

and the defendant would only have to pay

the claimants costs up to that point.

The Court had the power to depart from

the normal rule but only in exceptional

circumstances and the mere fact that

there was uncertainty over the value of the

claim was insufficient. The fact that the

claimant was a minor suing by a litigation

friend was not material.

Comment: Claimant solicitors will often

argue that they cannot consider early Part

36 offers without a firm prognosis. As this

case shows however, an early offer can

still be effective.

Interest on costs must runfrom date of costs order Simcoe v Jacuzzi UK GroupLtd Court of Appeal (2012)

The Court of Appeal has ruled that in the

County Court (in England and Wales),

interest on costs runs from the date the

court makes the order for costs and not

the usually much later date that costs are

assessed (or agreed).

The decision was made on the basis

that the County Court did not have the

power to alter the date of interest from the

general rule that it ran from the date of the

order. The fact of there being a Conditional

Fee Agreement in place and that the

claimant would not therefore be financing

the costs personally was held not to be

grounds for varying the date of interest.

Comment: This is not good news for the

paying party (usually defendants) who for

the last year or so have escaped paying

interest at 8% from the date of the costs

order. The case in question involved

costs of 74,000 with damages of only

12,750, prompting the Court of Appeal

to comment on the need for the more

proportionate costs regime that Lord

Justice Jacksons reforms are intended to

produce.


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Road Traffic Accidentwidely defined - Griffinv Wisbech Phab Club Supreme Court Costs Office(2011)

The claimant was injured when she

toppled over in her wheelchair as it was

being raised into a vehicle by a hydraulic

platform attached to it. The Phab Club

employee who was assisting the claimant

into the vehicle had failed to put on the

wheelchairs brakes or to secure the

claimants seat belt.

The claimant was awarded costs on

the standard basis but the defendants

appealed arguing that the accident was

a road traffic accident arising out of the

use of a motor vehicle. If the accident was

a road traffic accident then the claimant

would only be entitled to predictive costsunder Civil Procedure Rule (CPR) Part 45.

His Honour Judge Darroch upheld the

appeal finding that the accident had

arisen out of the use of a motor vehicle

and that CPR45 applied. The platform

was physically part of the vehicle and at

the time of the accident, the claimant was

being moved into it to be driven. Predictive

costs applied.

In reaching his decision, the judge

considered the Court of Appeal decision

in Dunthorne v Bentley and Cornhill

Insurance. In that case, the claimant had

been injured when the fist defendant ran in

front of his car to get some petrol for her

own vehicle. That claim was held to arise

from the use of a motor vehicle.

Comment: This case serves as a reminder

that the definition of a road traffic accident

is a broad one and the costs implications

of such a finding can be very helpful to

defendants.


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Liability

Passenger injured in courseof crime unable to claim:Delaney v Pickett and

Tradewise Insurance - Courtof Appeal (2011)

The claimant was catastrophically injured

whilst travelling in the first defendants car.

After the accident, both men were found

to be carrying commercial quantities of

cannabis. The first defendants insurers

declared his policy void when he admitted

he was a habitual drug user.

The insurers successfully argued that as

the use of the car had been to supply

drugs and the passenger must haveknown that the vehicle was being used in

the course of crime, they were entitled to

reject his claim under the Motor Insurers

Bureau (MIB) Agreement clause 6 (1) (e) iii.

The judge also found that the claim failed

on the principle of ex turpi causa non oritur

actio (an illegal or immoral act cannot bethe foundation for an action for damages).

The claimant appealed. The Court of

Appeal, found that on the facts the use of

the car was for the transportation of illegal

drugs and not for the driver to show the

claimant his new car as he had claimed.

The doctrine of ex turpi causa did not

however apply as the accident had come

about through poor driving and not directly

from the illegal activity. The claim failed

however because the MIB Agreement

exclusion applied. The vehicle was clearly

being used in furtherance and in the

course of a crime. The term crime in the

Agreement should not be read as being

restricted to serious crime as that would

make the clause largely ineffective.

Comment: L.J. Ward gave a dissenting

Judgment to the effect that only serious

crime precluded damages under the MIB

Agreement. Fortunately, for insurers, the

majority judgment was that the exclusion

did not only refer to serious crime. Had

the Court of Appeal found that it did, use

of the exclusion would have been greatly

limited in future.


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Vicarious Liability for Assaultat Work: Richard Waddell vBarchester Healthcare Ltdand Wallbank v Wallbank FoxDesigns Ltd - Court of Appeal(2012)

The two claimants in these conjoined

appeals sought damages from their

employers after being assaulted by junior

members of staff at work. Both claimants

had been unsuccessful at first instance.

In the Waddell case, the claimant was a

care home manager who had rung up

a member of staff to ask him to cover

for a sick colleague on a night shift.

The member of staff, who had been

drinking, took exception to the claimants

request. He refused to come in and later

telephoned the claimant to say that he

resigned. Some twenty minutes later,

he cycled into work and assaulted the

claimant. The judge at first instance held

that the assailant was acting on a frolic of

his own and that his employers were not

vicariously liable for his actions.

In the Wallbank case, the claimant was

assaulted when he asked a member of

staff to put more furniture frames into an

industrial oven for coating. The judge at

first instance again held that the employers

were not vicariously liable because the

assault took the employee outside the

course of his employment.

The Court of Appeal held that the

employers were not vicariously liable in the

Waddell case. The assailant had been off

duty at the time of the assault and there

had been a twenty-minute gap between

the request to cover the night shift and

the assault on the claimant. There was

insufficient connection between the

employees work and the assault.

In the Wallbank case, the court held that

the employers were liable. The assault had

been a direct reaction to an instruction

given in the workplace and although the

reaction had been irrational, it was still part

of employment.

Comment: Vicarious liability is a complex

and arguably expanding doctrine.

An employer can no longer escape

responsibility for the act of an employee

simply because it was illegal. The test is

one of the closeness of the connection

between an employees duties and his

wrongdoings. In the above cases, the

closeness of the assaults in time and

space to their employment was the keyfactor.

Our thanks go to Plexus Law who acted

for the defendants in the Waddell action

for their helpful note on this case.


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Quantum

92 year old Mesotheliomavictim receives significantGeneral Damages Award:Dennis Ball v Secretary forEnergy and Climate Change High Court (2012)

The claimant was a former National CoalBoard employee who was diagnosed as

suffering from Mesothelioma at the age

of 92. He sought damages for negligent

exposure to asbestos. All heads of

damages were agreed apart from his claim

for Pain, Suffering and Loss of Amenity

(PSLA), which the court was asked to

determine.

The defendants argued that due to the

claimants advanced age he had not

suffered much loss of amenity and that his

activities were little different from what they

would have been had he not developed

the disease. He had been forced to leave

his flat to live in a nursing home but this

might soon have happened anyway due

to his advancing age. An award at the

bottom of the current (tenth) Judicial

Studies Board (JSB) guidelines bracket for

Mesothelioma of 35,000 to 40,000 was

appropriate.

The claimants Counsel argued that

the claimants damages should not besignificantly reduced due to his age.

Although he had a short life expectancy,

his few remaining years were precious

to him and he had been deprived of his

independence. An appropriate award was

one at the lower end of the previous range

as published in the ninth edition of the JSB

60,000 to 65,000.

Taking all the factors into account the

judge made an award of 50,000.

Comment: this case has been reported

as opening the way for higher general

damages awards to the elderly. The

judge in this case did award more than

might have been expected but he took

into account the loss of the claimants

independence, which will not be a factor in

every case. The award still recognises that

the claimant suffered less loss of amenity

than would a younger man.


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Completed 23 February 2012 written

by and copy judgments and/or source

material for the above available from

John Tutton (contact no: 01245 272

756, e-mail: [email protected]).

Disclaimer

This publication has been produced by

QBE Insurance (Europe) Ltd (QIEL).

QIEL is a company member of the QBE

Insurance Group.

Readership of this publication does not

create an insurer-client, or other business

or legal relationship.

This publication provides information

about the law to help you to understand

and manage risk within your organisation.

Legal information is not the same as legal

advice. This publication does not purportto provide a definitive statement of the law

and is not intended to replace, nor may it

be relied upon as a substitute for, specific

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QIEL has acted in good faith to provide

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