The Civil Liability Bill completed its passage through the House of Commons yesterday, with MPs voting by 294 to 238 to approve its third reading.
The government gave no ground on amendments put by Labour, voting down an attempt to limit rises in the small claims limit for personal injury cases and also to exempt children and other protected parties from a higher limit.
The latter was the main unresolved question that had arisen during the bill’s committee stage, but justice minister Rory Stewart said the government has decided not to add to the exemption that it is applying to vulnerable road users, because there were enough safeguards in place.
He said: “In most cases, an individual who is in that situation, such as an infant, would be represented by their parents. In a situation in which they were suing their parents, because the parents were, for example, driving the car, a litigation friend would be appointed by the court.
“In the case that they would be unable to find a competent adult who met all the criteria… including there not being a conflict of interest from that individual, it would be possible to appoint the Official Solicitor.
“In a case in which that, too, failed, judicial discretion remains to move the case of the infant out of the small claims track into the fast track, where the legal costs would be recoverable. Of course, judges would still have a very serious role to play in approving any settlement made to an infant or any protected party.”
Shadow Lord Chancellor Richard Burgon said “people outside this place will not believe that the government did not concede on our common-sense amendment”.
The minister also rejected the bid to limit small claims limit increases to inflation and only then in £500 increments, saying it would “go against the entire policy intent of the bill”.
Mr Stewart continued: “The government’s position is clear: we have enormous respect for the work of personal injury lawyers, who play an honourable and important part in society in representing the interests of victims as a whole, and in no way should this bill be read as suggesting anything other than our respect for those individuals and the work that they do.
“However, we argue that the purpose of the small claims court is best dealt with through focusing on the nature of the claim [ie, its complexity], not on inflation.”
He also said the amendment raised a constitutional issue, in that the small claims limit was “properly an issue for the Civil Procedure Rules Committee, on which the Master of the Rolls, district judges, senior judges, personal injury lawyers – barristers and solicitors, including the chair of the Association of Personal Injury Lawyers – and representatives for consumer bodies such as Which? sit”.
The Labour amendment on the small claims limit mirrored the recommendations of the justice select committee, but notably all five Conservative members of the committee – chairman Bob Neill, Kemi Badenoch, Alex Chalk, John Howell and Victoria Prentis – nonetheless voted with the government.
The committee report said that, if the government pressed ahead regardless, it should delay implementation by a year to April 2020 to get the technology right, and this was agreed to back in July.
The debate otherwise replicated previous stages of the bill in both the Commons and the House of Lords, although Chris Philp, who has been one of the bill’s main backbench supporters, said he would prefer to see the small claims limit go up to £10,000, in line with other money claims, rather than £5,000 as proposed.
The only Conservative MP to express concern about the compensation tariff was Mary Robinson, who said it was “hard to explain to those who are injured that the same injuries sustained in different circumstances – for example, a comparable injury at work – should be compensated differently”.
But fellow Tory Huw Merriman said: “I freely admit that having a tariff system in place could well result in some people receiving less compensation, but that is exactly why I support the bill.
“At its heart lies an acknowledgement by those on this side of the House that insurance premiums have got too expensive and that we have to look at measures to try to reduce them.”
Another Tory, Mike Wood, described the debate as “increasingly showing a division between those on the side of personal injury practitioners, and those on the side of the overwhelming majority of our constituents who face the costs arising from an ever-escalating number of claims, of escalating value, for relatively minor injuries”.
Mr Stewart argued that it was “very difficult to prove through any medical means” whether or not the injuries of less than six months duration occurred, and were “therefore very difficult to defend against”.
He pointed out that the focus in the tariff was on reducing the compensation at the lower end, but “as we approach a duration of two years, the compensation offered begins to merge much more closely with the existing guidelines at a level of £3,600”.
The minister added that another amendment accepted earlier in the process meant the Lord Chancellor has to consult the Lord Chief Justice when setting the tariff, and reviewing it every three years.
“That concession in the bill, combined with the strong emphasis on judicial discretion allowing the tariffs to be uplifted, will be central to our attempt to reconcile a tariff-based system with the tradition of English common law.”
By taking cost out of claims, he added, the number of potentially exaggerated or fraudulent claims would “hopefully” be reduced.
Labour’s Ruth George expressed her scepticism about the online portal through which it is planned that litigants in person will bring their claims.
“I am a member of the select committee on work and pensions and we were told that there would be an online portal for universal credit, yet 47% of claimants are unable to access the portal,” she said.
“An online portal is, of itself, not an easy thing to access, particularly for people for whom IT is not their natural sphere.”
She said the new small claims limit should not be introduced “until the portal has been demonstrated to be easily usable by at least 95% of those who seek to use it”. However, Mr Stewart did not make any such commitment.
But he said the combination of the portal, requirement for a medical examination and tariff “should mean that in the overwhelming majority of cases there would be absolutely no requirement to proceed to court”.
Looking more broadly at the bill, Mr Stewart pointed to “a number of very serious concessions” made by the government since the bill was first mooted by then Chancellor George Osborne in November 2015 – at the time he suggested removing compensation for minor whiplash injuries altogether.
“With a series of realistic, focused and pragmatic compromises, we have struck the right balance between the protection of genuine claimants who have suffered genuine injuries, and the protection of different forms of public interest—in particular, the public interest of people, especially in rural areas, who need to be able to afford their motor insurance in order to move around.
“This bill will remove unnecessary complexity, unnecessary costs and, in particular, the moral damage and hazard that currently exist in the form of claims management companies and a few unscrupulous individuals.”
The various amendments made by the Lords and Commons need to be reconciled before the bill heads to Royal Assent.
The focus of lobbying will now move to the secondary legislation that will have to be made under the Act to implement much of it.