Thursday, 30 August 2012

Five grand

What does “five grand” mean to you? Is it a significant sum of money?

If you’re entitled to both components of Disability Living Allowance at the highest rates then it’s a little over 8 month’s income.

If you’re a legal secretary it may be around 4 month’s net income.

If you’re a comparatively high earner managing to allocate the 10% of gross income that some recommend you should, you’ll buy a very decent family holiday with it.

If you’ve lost a finger, broken your arm or have significant facial scarring as a result of an assault it may be what you are awarded as compensation for criminal injuries.

It will buy ten laptops, five large televisions, a complete range of white goods for your kitchen - or one Segway.

According to the Office for National Statistics, it represents nearly 3 months average UK household spending in 2010.

I’d bet a significant sum of money (but nowhere near £5,000) that it means a lot to the majority of folk in this country.

But not to the Government or the insurance industry.

They want to raise the ‘small claims’ limit for personal injury claims from the current level of £1000 to £5000 – a 500% increase. What does that mean?

It means that unless an injured victim’s claim is worth at least £5000, they will not be able to recover any lawyers’ costs in pursuing their claim. If they need to use a solicitor or a barrister, they’ll have to pay for it out of the compensation they recover.

Compensation they may sorely need to replace weeks or months of income lost because of the negligence of another car driver, their employer, a highways authority, a doctor – and so on..

The idea is that they don’t need a lawyer to run a claim for such an insignificant sum of money. They can deal with it themselves.

Familiar with court process are you? Happy to learn at a time when the rest of your world is falling apart?  Content to wait, with no money coming in, for months…and months…and months?

Because you will. Insurers employ claims managers and lawyers whose primary function is to delay, discourage and frustrate claims. It’s a key element of their commercial ethos. They are really good at it and the only people who can beat them are the claimant lawyers who know the ropes.

They pay these people as part of their overheads that form part of the calculation of the insurance premium that they charge to all of us. They try to justify the assault on costs recovery by pointing to the cost of insurance to the general public.

This is the same general public who, having paid the premia, will be shafted when they have a claim but can’t afford the services of the only people who know how to deal with these cynical, selfish creatures.

Will the cost of insurance fall? Look at the annual accounts of some major insurers, see the value of the packages paid to executives and read what they aim to make for their shareholders. Read it and you will weep.

Sure, there is always a line to be drawn, a point at which it can only make sense to forget it and move on.

But it’s not £5000 or anywhere near. Even now there are pensioners and young kids who desperately need to be compensated for losses of less than £1000 but whose only true hope of a result lies in the compassion of lawyers that Clarke, Bojangley and chums deride as ambulance chasers.

This is a political issue. If you’re not lying in a hospital bed or struggling with a plaster cast right now, it may not seem important. It is.

Think of those who are and think of those who will be in the future – it may be you. Speak out - now.

By the way, current fees at Eton are £10,689 per “half” – which is a term – and there are three in a year.

You'll have to excuse me a while...

Sunday, 19 August 2012

Panel beater

My attention was drawn this week to a report of the Bristol law firm sued by a paralysed motorcyclist who said they "bungled" his claim.

54-year-old Kenny Jordan, wheelchair-bound after a road accident in May 2004, was referred to what the news article describes as "insurance panel firm Clarke Willmott (CW)", in Bristol. Mr Jordan lives in Manchester.

It seems they recovered a chunky £512,000 for him by negotiation. Mr Jordan talked to other people after the event who suggested that he should have received at least £1 million. CW have now agreed to pay Mr Jordan £500,000 (on top of the original settlement) plus his legal fees in bringing the negligence claim against them.

Unfortunately, these things can happen (though less frequently in this industry than in some others) but some of the facts of this case as stated by Mr Jordan's current solicitor are remarkable.

He says that in the course of dealing with the claim for Manchester-based Mr Jordan, his former lawyers never went to see him, never took a detailed statement, never interviewed any witnesses, never obtained any expert medical evidence. On that foundation they settled a £1 million claim at half value.

We’re talking about one of the big national law firms receiving so much of their work from legal expenses insurers. These are the insurance companies whose policy is usually bolted on your main road traffic insurance policy or household insurance for tens of pounds. It's called before the event, or BTE, insurance.

Many claimant lawyers do not seek membership of panels for various reasons. Those include that they are unwilling to pay "subscriptions", unwilling to pay referral fees to the insurers for individual cases and unwilling to receive discounted remuneration for doing the work.

Some believe that such arrangements lead inevitably to a squeeze on margins so that the cost-effectiveness of the case becomes more important than the injured client’s best interests.

BTE insurers have told me (when denying my clients/their insured freedom to choose their lawyer) that the determining feature of panel solicitors is that they are specialists - subject to high quality standards and rigorous audits…

There are plenty of top class expert personal injury (and other) lawyers in and around Manchester who would have done the job properly, with the client on their doorstep. Why does a case like this end up on the books of a law firm 200 miles away who, probably for that reason, don’t deal with it properly?

The only answer is that it serves the commercial interests of insurers, who control the process. It doesn’t serve the interests of the injured victim, plainly.

How many others out there? This was a big case, easier to identify and almost a no-brainer on the reported facts for a negligence claim but what about smaller claims being pushed through the mill with similar lack of attention. They’ll maybe never come to light.

Accident victims may think they are better off retaining a local lawyer. Someone they know. Someone who only gets paid on results. 

Someone whose masters are not the insurers.

Wednesday, 15 August 2012

Repeat prescription

"The current rate of increase in the number of claims for compensation for clinical negligence and referrals to the regulatory bodies is unmatched in the company's 126 year history', wails the annual report of the Medical Defence Union.

The plan to tackle this sort of statistic, which actually represents ruined lives of people who put their trust in an expert?

Well, apparently it's to lobby ministers to cut the cost of damages awards.

This comes hard on the heels of our Supreme Court beginning to consider how we will implement one of the recommendations of the Jackson report that awards be increased by 10% across the board to balance the forthcoming bar on recovery of success fees.

No doubt encouraged by the success of liability insurers it seems the MDU now wants a piece of the action. Presumably they’ll be heading round to Downing Street for beer and sandwiches - or rather tea and cakes.

Head of Claims at the MDU, Jill Harding, denies that clinicians are to blame, explaining that "the increase in claim numbers is not, we believe, driven by deteriorating standards of care'.

Rather, "it seems likely that the continuing availability of no-win, no-fee arrangements to fund cases is a factor'.

Look, it's very simple. There's no fee unless there's a win, and there's only a win if there’s a cock-up.

Yet again we see an unhealthy preoccupation with - rather than eradicating errors - trying to silence and sabotage the victims and their solicitors.

And if you think that's bad, get this. In the same report the head of claims boasts that “the MDU continues to rebut 70% of medical claims notified to us"

Well, give yourselves a big pat on the back, won't you?

Sunday, 12 August 2012

Rule Britannia

It wasn’t looking great two or three weeks ago.

Summer floods, a result of seemingly endless rain and the economy still in a coma after five years. Then came the humiliation of the Leveson enquiry and further disgrace for London’s institutions with the antics of the repulsive Bob the Banker and friends.

As the world’s media readied itself the MoD fought in the courts with the ‘not on my flat roof’ brigade, G4S appeared about to screw up security and the doubts continued about the worth of our investment in this event.

Painful memories have slipped away during the last fortnight as we’ve witnessed something truly spectacular right from the opening ceremony. It has been a feast worthy of Sebastian Coe’s description of what “brings together the people of the world in harmony and in friendship and peace to celebrate what is best about mankind.”

Sport transcends all boundaries. London 2012 has been another big win. So much has been so good.

Team GB takes bronze in the overall medals table with a haul of 65 including 29 golds, the best performance ever and way beyond hopes and expectations.

All this happened (primarily) within an enviable environment amidst exemplary organization and management. Unless I’ve missed something, it’s been smooth and slick from start to finish.

Lord Coe promised “In the next two weeks we will show all that has made London one of the greatest cities in the world, the only city to have welcomed the games three times. Each time we have done it the world faced turbulence and trouble and each time the games have been a triumph.”

Well, it did and they were and we have. We owe thanks to all those involved for putting the “Great" back into Britain. I feel proud again.