News focus: Prison and Courts Bill

The lord chancellor’s evasive and hesitant performance before the Commons justice committee last September is a receding memory.

Liz Truss took a while to get going, but the multifaceted Prisons and Courts Bill unveiled last week should finally dispel any lingering allegations of inertia – for better or worse.

In addition to well-trailed proposals on reforming the penal system, the bill confirmed it will increase the small claims limit to £5,000. This will apply only to ‘RTA-related personal injury’ claims, with a new threshold of £2,000 for all other personal injury claims.

The latter figure is a retreat on the original proposal to increase the limit across the board, but the Ministry of Justice will push through plans for fixed tariffs to cap whiplash compensation payments.

There will be a ban on any offers to settle whiplash claims without providing medical evidence.

This ban, together with compensation tariffs, will require primary legislation and will form part of the bill.

The change in the small claims limit needs secondary legislation only and could have been introduced as early as October. But the MoJ said it will bring in revisions only when the bill becomes law, so the reforms can be implemented together.

The MoJ reiterated that it expects motor premiums to be cut by around £40 a year as a result of the reforms.Justice minister Sir Oliver Heald said: ‘We are determined to get a grip on the widespread compensation culture that unfairly impacts millions of motorists through higher premiums.

‘So we are cracking down on minor, exaggerated and fraudulent whiplash claims. And we expect insurers to fulfil their promise and put the money saved back in the pockets of the country’s drivers.’

The tariff figures cover both whiplash claims and ‘minor’ psychological claims – for example travel anxiety or shock.

Damages are limited to £225 for injuries lasting up to three months, £450 for injuries lasting up to six months and £765 where the injury lasts up to nine months. Compensation is £1,190 for injuries lasting up to a year, £1,820 for injuries lasting up to 15 months, £2,660 where the injury lasts up to 18 months and £3,725 where the injury lasts up to two years.

The bill will provide the judiciary with the facility both to cut the amount awarded under the tariff in cases where there may be contributory negligence, or to increase the award by up to 20% in exceptional circumstances.

Responding, the Law Society said the £5,000 limit for RTA claims would not only deny justice to accident victims but also clog up the courts by forcing many victims to act for themselves.  A spokesperson said: ‘Those defending claims, meanwhile, are likely to be able to pay for legal advice. The increase in the number of litigants in person that will result from these changes will have serious consequences for the courts.’

The Society did, however, welcome a proposal to ditch the practice of insurers offering compensation for whiplash ahead of any medical assessment. This should be extended to all claims, the Society argues.

Chancery Lane was among those deeply sceptical about whether the reforms will cut motor premiums – though not quite as outspoken as Stephen Cavalier, chief executive of leading PI firm Thompsons, who accused the government of a ‘craven capitulation to the insurance industry’. He said this also applied to the doubling of the small claims limit in other injury cases, adding:  ‘Even the insurers’ own spokesman [has] conceded that the increased limit should not apply to workplace cases. Yet the government suggests it is prepared to go further still for its insurance friends by holding out the prospect of applying the £5k limit to all personal injury claims.

‘There has never been any suggestion of fraud in workplace claims and they have nothing to do with any supposed “whiplash epidemic”.’

Andrew Twambley, for the Access to Justice campaign group, said insurers will be ‘rubbing their hands in glee’, adding that a £5k RTA limit ‘will open the door for claims

management companies and cold callers to wreak further havoc on the market’.

Claimant lawyers submitted 56% of the 625 responses to the government’s consultation, with most opposing the increase in the small claims limit and a tariff system for whiplash damages.

Their input dwarfed that of the insurance lobby, which submitted 5%.

The Association of British Insurers, predictably, declared that the reforms ‘cannot come soon enough’.

Elsewhere, the bill will end the cross-examination of domestic violence victims by their abusive ex-partners in the family courts. Virtual hearings will be extended, allowing victims to take part in proceedings without having to meet their attacker face-to-face.

Last month justice minister Sir Oliver Heald told MPs that the lord chancellor had requested urgent advice on how to put an end to the practice, which is banned in the criminal courts.

Heald said the government was looking in particular at the provisions in the criminal law that prevent alleged perpetrators from cross-examining alleged victims in criminal proceedings, and how it might apply similar provisions in the family courts.

Sir James Munby, president of the Family Division, first highlighted concerns about vulnerable witnesses giving evidence in family proceedings in 2014, setting up a working group.

The bill will also effect plans for digital justice set out in the Transforming Our Justice System strategy. Interested members of the public will be able to view ‘virtual’ court hearings from purpose-built booths in court buildings. The proposal is an attempt to counter threats to open justice by a courts system increasingly operating digitally. Court listings and case results will also be published online.

Other digital measures include:

• Automatic online convictions with statutory standard penalties for some criminal offences. Offenders charged with certain non-custodial offences such as evading transport fares will be able to plead guilty online, accept a conviction, be issued a penalty and pay that penalty there and then;
• Online court. The bill provides for digital services to enable businesses to issue and pursue claims quickly; and
• Virtual hearings. These will be extended to allow victims of crime to take part without having to meet the accused face to face. They will also enable many hearings, such as bail applications, to be resolved via video or telephone conferencing.