Whiplash reforms in the Lords

On 10 May Peers scrutinised the whiplash reforms set out in Part 1 of the Civil Liability Bill. As was noted here previously, a range of probing amendments had been tabled for debate and, days before, the MoJ had released draft regulations setting out its preferred definition of whiplash injury and its preferred tariff of general damages for whiplash injury. None of the amendments were put to a vote and the Bill proceeds as is on 15 May for a further Committee Stage debate. That will focus on the discount rate clauses in part 2 of the Bill, as well as completing the scrutiny of part 1.

Given that the draft whiplash regulations were published just a few days before the debate, Justice Minister Lord Keen was content to give Peers more time to study them in detail. We can therefore expect that they will be re-examined at the Report Stage of the Bill. Lord Keen said he would not take a final position on whether the definition of whiplash should remain the regulations or appear in the Bill itself, as was recommended by the Delegated Powers Committee and supported by several Peers who spoke in the debate. Former Lord Chancellor Lord MacKay made what seems a reasonable point: since the Bill requires a medical report before settlement of a ‘whiplash claim’ as defined, then a definition of the injury should appear in the Bill.

The idea of exempting those driving in the course of their employment from these reforms was dismissed by the Government and such claimants will, unless further amendments were to succeed, fall under the whiplash reforms. Attempts to bring some judicial oversight into the setting of the general damages tariff for whiplash were also strongly resisted by the Government. Lord Keen said this was a clear policy issue and the Government had to set the tariff to in order to drive behaviour:

“we have to take a policy view as to how we can disincentivise not just fraudulent claims but what I would call unmeritorious claims – very minor and exaggerated claims. Our view is that it is right to set the tariff through regulations, which will help to control those costs and ensure greater certainty to both claimants and defendants when they come to deal with these claims.”

One potentially awkward technical point for the Government is that the tariff set out in the draft regulation is actually an earlier, lower version than that in the impact assessment accompanying the Bill. As we pointed out previously, this is very probably simply a mistake. However, it is not immediately clear how quickly it might be rectified, as it might arguably require a new set of draft regulations to be produced to do that.

Other notable points emerging from the debate last week were:

  • the heavy lobbying from cycling and motorcycling interest groups to exempt them from the reforms, which the Government continues to resist (the whiplash reforms apply only to people in vehicles other than motorcycles but the small claims increase to £5,000 will apply to all road traffic injury cases),
  • the Government’s confirmation that it is working on a portal for litigants in person “so that claimants will find the system far more accessible … work is already under way on a portal accessible to litigants in person where the small claims limit applies” (although the outputs of that work are fairly invisible at the moment), and
  • a clear statement from Lord Keen that the cost of the medical report required by the Bill in order to settle a whiplash claim “will continue to be recoverable following these reforms, including the proposed reform in the small claims track, which is not part of the Bill … in particular that it is intended that that cost will be a recoverable element in each and every case where liability is accepted.”

We will report later this week on the debate on the discount rate provisions which takes place on 15 May. After that, it seems likely that the remaining Lords stages of the Bill (Report and Third Reading) will be scheduled to take place in June.

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Written by Alistair Kinley, BLM’s Director of Policy & Government Affairs

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