By Andrew Christie, personal injury specialist at Harding Evans Solicitiors

In 2004, the Better Regulation Task Force reported to the Government about the compensation culture myth. One of its recommendations was that research should be conducted with a view to raising the limit in small claims cases with a personal injury element from its present level of £1,000 to £5,000. This will have far reaching consequences both for the legal profession but more importantly for the individual in terms of being able to seek access to justice.
 

Subject to some exceptions, one of which is personal injury, the level of claims that proceed in the Small Claims Court is up to £5,000. One of the most important factors which relates to small claims cases are the restrictions regarding the recoverability of costs. In the Small Claims Court it is virtually impossible for claimants to recover the vast majority of their costs whether they win or lose the case. This is unlike higher Courts where costs (including the costs of a legal representative) can be recovered if the case is won.

2. Does the Small Claims Court help access to justice?

The Small Claims Court impedes access to justice for personal injury cases. A recent MORI Survey showed that 64% of adults would be unlikely to pursue a personal injury claim through the Small Claims Court without an independent solicitor helping them. In addition, 73% of claimants would be unable to work out the value of their claim without the assistance of an independent solicitor.

It follows that the lack of legal advice in a Small Claims Court acts as a disincentive for those with low value cases seeking compensation which is rightfully theirs because a large proportion would not bring a legal case without a solicitor.

The average claimant will know very little, if anything at all, about putting together a personal injury claim and it is very unfair that the onus is on the injured person to gather medical reports, to present them properly at Court and ultimately to determine if the defendant is liable.

Most personal injury claims, including those in the Small Claims Court, are made against big business or an insured defendant who (unlike the claimant) is always legally represented. This clearly tilts the playing field against the claimant.

It is therefore unjust that injured people should be dissuaded in proceeding with their claims because they do not have the legal expertise to represent themselves, whilst defendants may take advantage of this lack of knowledge to escape their obligations.

3. Does the Small Claims Court work effectively and efficiently for personal injury cases?

The answer to this question must be a resounding no. Due to the lack of funding for legal advice available for claimants in the Small Claims Court, it is neither effective nor efficient for those bringing personal injury cases.

Proving negligence is more problematic for an unrepresented claimant because there can be medical problems which prevent an early assessment. For example the claimant may not recover as well as his doctor hopes or he may have symptoms which need to be further investigated. The net effect of a non-legal trained claimant attempting to carry out a legal task is that he or she may inadvertently accept an offer from an insurance company which is too low and be under compensated as a result.

4. Should the small claims limit for personal injury cases be raised?

Again, the answer to this question is an overwhelming no. Research has shown that contrary to popular belief the vast majority of personal injury cases are not of a very high value. According to a survey undertaken by the Association of Personal Injury Lawyers, 70% of personal injury cases are valued at less than £5,000. This means that the vast majority of claimants could end up representing themselves.

The survey also shows that for cases valued up to £5,000, the difference between the first offer made and the first settlement for the cases analysed was on average almost £1,000. This represents an average increase of around 50% from the first offer to the final settlement. This suggests that if claimants were to accept the insurers first offer without the aid of legal help that they could dramatically be under compensated.

Legal advice is absolutely essential in all personal injury cases as a way to ensure that the injured person receives the full compensation to which they are due.

5. What conclusions can be drawn?

Personal injury cases have no place in the Small Claims Court. In allowing such cases to be heard in the Small Claims Court this would act as a barrier to justice for injured people. The complexity involved in personal injury cases and the lack of funding for legal assistance in the Small Claims Court makes it inefficient and ineffective for personal injury cases.

If the limit were to be raised to £5,000 as suggested by the Better Regulation Task Force, up to 70% of personal injury claims would go through the Small Claims Court.

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