Civil Liability Bill [Lords]

Victoria Prentis Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 23rd October 2018 Commons Chamber

[Andy Slaughter]

I congratulate the hon. Lady on getting a helter skelter of nonsense into one intervention, with every prejudice and false statement that has been made in the tabloid press about these matters for about the last 10 years—well done on that. I could make a long speech dealing with the specific issues of—[Hon. Members: “Go on!] We have got time, haven’t we? No, I will not. I could go into detail about some of the myths about whiplash and soft tissue injuries and what is actually happening in relation to accidents, the insurance industry and premiums, because I have been an observer of that for a long time. However, let me limit myself to a fairly narrow point.

I have listened to the arguments from Government Members, and they are just non-sequiturs, frankly. We have heard that insurance premiums are the issue. Let us imagine that we give the benefit of the doubt there, which I certainly do not, and say that premiums are likely to fall significantly and that that is a factor relating to claims rather than to insurance companies’ profits, the other activities that they indulge in and the way that their businesses are run. I do not accept that, but let us assume that we do for a moment.

The hon. Member for Cheltenham (Alex Chalk) is no longer in his place, but he made a surprisingly illogical—for him—intervention. He said, “Look, people will still get special damages.” Of course they will get special damages, but special damages are what the name suggests—they are to compensate for specific items of loss. Why should the fact that someone still gets compensation for their loss of earnings or their medical bills, or something of that nature, mean that it is right to diminish their compensation for pain and suffering and loss of amenity? These are all non-sequiturs. The worst calumny of all is to say, “We are reducing the level of damages from slightly mean levels to absolutely parsimonious levels because of fraud”, which is exactly what we heard in relation to the small claims limit. So many members of the senior judiciary and indeed, of Select Committees, including not just the Justice Committee, but the Transport Committee, have said that it is plain wrong to say that because there may be instances of fraud, of which very few are identified, all litigants should suffer by having their damages reduced.

[Victoria Prentis (Banbury) (Con)]

I understand what the hon. Gentleman is saying about quantum, but I would be interested to know, theoretically, whether he objects to the idea of tariffs being appropriate for this sort of compensation. I remind him that Lord Brown said

“I am in broad agreement with the whole idea of tariffs for injuries, certainly for lesser injuries, and indeed even of reducing awards in respect of a number of these lesser injuries.”—[Official Report, House of Lords, 10 May 2018; Vol. 791, c. 306.]

Does the hon. Gentleman agree that tariffs can be appropriate with, for example, criminal injuries compensation?

[Andy Slaughter]

There is an element of semantics going on here. We have guidelines at the moment. Judges do not pluck figures out of thin air. They look at the guidelines and hear submissions, or they would have heard submissions when representation was available—it seems it no longer will be—and they make a decision, but they have discretion around the individual circumstances of the case. That is a basic and fundamental principle of law, but one that we are deviating from. I cannot say strongly enough that that is wrong.

To add insult to injury—if I may put it that way—rather than taking the average in the guidelines and having a rough rule of thumb that someone will get a bit more or a bit less than their individual case deserves, or going for an average and calling that a tariff, we are saying that a tariff should be a tiny percentage of the current award. This is nothing but an attempt to say, “We do not wish to pay out money in this way. We wish to diminish both the ability to make a claim and the compensation paid.” Whatever one’s view on fraud, the massive majority of cases will be meritorious and honest cases in which people have genuinely suffered injury.

I will conclude with the words of the former Lord Chief Justice of England and Wales, Lord Judge, on Report in the other place:

“What I cannot accept is a solution which means that a dishonest claim is handled in exactly the same way as an honest one. We cannot have dishonesty informing the way in which those who have suffered genuine injuries are dealt with. That is simply not justice. There should not be any idea that an honest claim for a whiplash injury made by the victim of a car accident should be less well compensated than an identical injury suffered by someone at work.”—[Official Report, House of Lords, 12 June 2018; Vol. 791, c. 1600.]

That is what the Government are doing in the Bill and what is so inherently unfair, and they are doing it at the behest of special interests. They may genuinely believe that there is a problem to be resolved with whiplash. I could dispute that—we could go on for a lot longer than we are today—but even if they are right, there are other, better and fairer ways to tackle that issue.

--- Later in debate ---

[Huw Merriman]

My hon. Friend is spot on. In the seven years before I came to this place, I managed the legal team that was unwinding the Lehman Brothers estate. In many instances, we looked to sue, but of course, we considered the cost of the claim and then worked out whether settlement was a better option. Settlement should always be a better option. For someone running a business, it will always be the better option if it is cheaper to settle than to pursue. All businesses operate in that manner.

It is all well and good for the hon. Member for Enfield, Southgate (Bambos Charalambous), who is no longer in his place, to say that there should be a duty on insurers to take those cases forward, but they will not because it is not cost-effective. In addition, it is difficult to disprove those particular injuries.

[Victoria Prentis]

Does my hon. Friend accept that there is an emotional gain from settlement? Even those of us who are lawyers and enjoy the cut and thrust of the legal process know that bringing cases forward is a stressful experience for all claimants. It is important that we put energy and effort into making claims settlable at an early stage.

[Huw Merriman]

My hon. Friend is right. When I was running the legal team, it always distressed me when we settled because, as a lawyer, I found the whole court process incredibly interesting, but those on the financial side insisted that we settle because that was the better business decision to make. However, my hon. Friend is right about the distress of individuals going through the process. Of course, insurers have to focus not just on the money, but on the valuable human resource implication—the manpower it takes to fight the claims.

That comes back to my point that it is not an issue for insurers if ultimately their costs are covered because the price of premium for everybody else goes up. It is no skin off the bone for them to settle, and that is what occurs. For change, Government action is required. Although I readily accept that a tariff situation is genuinely not to be found in common law, the position that we have got ourselves into means that we need to look at the system akin to the way that we consider the Criminal Injuries Compensation Authority, which fixes the tariff in the same way. That is not unusual if we look at our European friends such as Italy, France and Spain, where similar systems are in place.

I represent a largely rural constituency of 200 square miles. I have many younger constituents who find the price of insurance too great. Studies show that, for those aged between 18 and 21, 10% of their wage will be taken just to cover their insurance. In a rural constituency, there is no choice. If people do not have a car, they find it very difficult to travel. The bus services are not as they were and, without a car, people cannot get from A to B or go to work. That has a knock-on effect because 28% of my constituents are over 65—the national average is 17%—so I have a lot of older constituents who need looking after. We have high social care bills. If we lose our younger people to the cities because they cannot afford to travel around a rural constituency, the balance goes completely.