Personal Injury Update

Personal Injury Update August 2013 Review of the Transport Select Committee s Whiplash Report Whiplash capital The House of Commons Transport Select Committee has disclosed its further report on the effect of whiplash on motor insurance premiums and has provided a number of recommendations to the government. In this issue: Review of the Transport Select Committee s Whiplash Report Enterprise & Regulatory Reform Act 2013 Plexus obtain favourable judgment in asymmetric hearing loss and occupational noise exposure case There are around half a million whiplash claims arising from motor accidents each year leading the government to describe the UK as the whiplash capital of the world. Fraud and exaggeration Whiplash injuries are soft-tissue injuries, predominantly affecting the neck, caused by a sudden, forceful jerk. However, there is no generally accepted objective test for a whiplash injury. Like headache or backache there is no physical manifestation of the injury and nor can it be detected by a CT or MRI scan. This, along with the trend for the number of claims to increase, has contributed to concerns about fraudulent and exaggerated claims. The committee concluded that the government s claim that the UK was the whiplash capital cannot be conclusively proved or disproved from the information available. It was however accepted that some of the increase in the number of whiplash claims are due largely to fraud or exaggeration, even if it is not possible to give even a rough estimate of the extent of the problem. Types of fraudulent activity mentioned included cash-for-crash, where crashes were caused deliberately to generate claims; claims relating to non-existent passengers; fabricated or exaggerated symptoms; or exaggeration of the impact of a genuine injury. The report found that there is scope for the insurance industry to provide better data about fraudulent or exaggerated claims so that there is a better evidence base for policy. Industrywide agreement about how to classify claims and the collection of data by the ABI would strengthen the case for the government to act. It is recommended that the government press the ABI and lawyers to collaborate to provide better data on fraudulent or exaggerated personal injury claims, so that there is a stronger evidence base for policy decisions. To this extent, the insurance industry has been called to immediately get its house in order and end practices which encourage fraud and exaggeration. The committee heard worrying evidence about how few claims are contested, because of the difficulties and cost of doing so. The early settlement of claims without medical evidence was raised as a particular concern. Recommendations were also made on data sharing and on whether claims involving an element of exaggeration should be struck out. It is recommended that the Ministry of Justice (MoJ) give its view on the issues involved in limiting the right to compensation where it can be shown that a claim is grossly exaggerated. The case of Summers v Fairclough was provided as an example. Independent medical panels The proposals to improve medical reports accompanying whiplash claims and to transfer most claims to the small

claims court procedure were considered in some detail. The committee was far more supportive of the government s proposal to set up independent medical panels than the suggested reform of the small claims procedure. The MoJ is consulting on whether a system of independent medical panels, made up of accredited medical practitioners, should be established to assess claims for whiplash injury and give objective, impartial advice to the court. A key feature would be the use of a standardised medical report based on best practice guidance. themselves. The committee was also concerned that using the small claims track would prove counterproductive in discouraging fraud and exaggeration as a claim where that was alleged would be transferred to the fast-track. Further, the MPs said the government needs to analyse the impact of the RTA portal on claims and costs before increasing the limit. The government also needs to explain how it will monitor that insurers honour their commitment to reduce premiums as a result of lower claims costs. The MPs broadly support the government s proposals on improving medical reports. However, it is encouraging that they would like to go further and require whiplash claimants to provide more information in support of their claim, such as proof that they saw a medical practitioner shortly after their accident or evidence of the impact of the injury on everyday life. Medical experts should be provided with information about the accident and the claimant s medical records. Reports prepared without this information are likely to be of very limited value. It is also suggested that the government bring forward recommendations to reduce the three year limitation period during which whiplash claims can be made given the fact that symptoms of a whiplash injury usually emerge within seven days, and do not usually last for more than one year. Small claims limit Whilst it is agreed that reducing the cost of car insurance premiums and the incidence of fraudulent and exaggerated claims is beneficial, the MPs were not convinced that the evidence supported an increase in the small claims limit. There are good arguments for and against switching most whiplash claims to the small claims procedure but at the present time the proposal was opposed. The committee concluded that although it may make economic sense for an individual insurance firm to settle a claim without medical evidence, or to pay out even if fraud or exaggeration is suspected, the industry as a whole is damaged and motorists pick up the bill in the form of higher premiums. Insurers need to end practices which encourage fraud and exaggeration. If not, the government should take steps to protect motorists. Although the committee correctly identified the urgent need to tighten up the requirements for whiplash claims, its report has delayed implementation of the tough reforms that are required to help insurers combat the whiplash epidemic and achieve reduced motor insurance premiums. However, it is hoped that the MoJ will adopt a number of the sensible measures recommended by the committee including the provision of more information in support of a whiplash claim and a reduction in the limitation period. For further information contact: Laurence Ives or Karen Scott details on page 5 MPs warned that the government risks restricting access to justice through its plan to raise the small claims limit in personal injury from 1,000 to 5,000. This would particularly affect people who did not feel confident to represent 02

Enterprise & Regulatory Reform Act 2013 Significant reform? Liability and breach of duty in EL/PL claims are primarily governed by a raft of health and safety regulations which have been enacted under the Health & Safety at Work Act 1974. Therefore all the health and safety regulations above (including Six Pack Regulations and others) will not give rise to civil liability unless the Secretary of State orders otherwise. Regulations brought in under HSWA 1974 include: Provision and Use of Work Equipment Regulations 1998 Workplace (Health, Safety and Welfare) Regulations 1992 Personal Protective Equipment at Work Regulations 1992 Manual Handling Operation Regulations 1992 Display Screen Equipment Regulations 1992 Management of Health & Safety at Work Regulations 1999 Work at Height Regulations 2005 Lifting Operations and Lifting Equipment Regulations 1998 The above regulations are pleaded in civil claims as breach of the statutory duty gives rise to civil liability. This is dealt with by section 47 (2) HSWA 1974 which states that for civil liability: Breach of a duty imposed by Health and Safety Regulations shall, so far as it causes damage, be actionable except insofar as the Regulations provide otherwise. At face value therefore this is a very significant reform indeed. The government has gone well beyond what was envisaged by Professor Löfstedt in his November 2011 report Reclaiming health and safety for all but it is a further welcome reform from the viewpoint of defendants and insurers. Implementation There will however no doubt be satellite litigation around this reform which has not yet come into force. The target date for Royal Assent and implementation is 1 October 2013. Section 69 of the Enterprise Act will only apply to a breach of duty occurring after the date of commencement of the section. What will this reform mean in practical terms? All regulations together with HSWA 1974 will still be able to be used by the HSE and other regulatory bodies for criminal prosecutions. Current civil personal injury claims are therefore based upon both breach of statutory duty and common law negligence. Certain regulations such as Reg 5 of PUWER (which relates to defective work equipment) have been interpreted by the courts as conferring strict liability on a defendant such that there is no defence of reasonable practicability afforded to the defendant i.e. if a piece of work equipment breaks then the defendant is liable despite an adequate and suitable system of maintenance and inspection of the equipment. Claimants will now only have to plead common law negligence but are still able to cite health and safety regulations as a guide to what is a reasonable standard of care. Judges are used to dealing with the regulations and will, in many cases, impose a common law duty of care on a defendant that is equivalent to that of the regulations. The impact will not therefore be as radical and wide ranging as some claimant commentators are suggesting which is that the law on health and safety is going back to Victorian times. The Enterprise Act reverses the presumption of civil liability. Under section 69 of the Enterprise Act it states that for civil liability for breach of health and safety duties: Breach of a duty imposed by a statutory instrument and/or existing statutory provision shall not be actionable except to the extent that Regulations under this section so provide. 03 However, certain cases which previously were not capable of being defended due to strict liability applying under statute will now be defendable on the grounds of reasonable practicability. For further information contact: Anthony Baker details on page 5

Plexus obtain favourable judgment in asymmetric hearing loss and occupational noise exposure case The court s careful consideration of the technical literature in this unreported case may be a useful weapon for insurers and defendants contesting asymmetric noise induced hearing loss claims. At the beginning of this year, Her Honour Judge Staite handed down judgment in the case of Cran v Perkins Engines Company Limited which concerned causation in a case where the claimant had an asymmetric hearing loss. The defendant admitted breach of duty for the period from 1963 to 1977 and causation was the only issue considered at trial. Medical evidence Within the claimant s occupational health records were four audiograms which had been carried out in 1984, 1986, 1988 and 1990. The claimant was aged 54 at the date of the first audiogram and all these audiograms showed notching/ bulging in the claimant s left ear but well-preserved hearing in his right ear. It is generally accepted that occupational noise exposure causes a symmetrical hearing loss and there was no evidence presented by the claimant that his exposure was asymmetrical. The parties relied on medical evidence from ENT surgeons. Mr Jack Lancer gave evidence on behalf of the claimant and Mr Andrew Parker gave evidence on behalf of the defendant. Within the judgment HHJ Staite carefully considered the papers: R.R.A. Coles, M.E. Lutman and J.T. Buffin Guidelines on the diagnosis of noise induced hearing loss for medico legal purposes, Clin.Otolaryngol. 2000. 25, 264-273; and S.V. Fernandes and C.M. Fernandes Medicolegal significance of asymmetrical hearing loss in cases of industrial noise exposure, The Journal of Laryngology & Otology. 2010, 124, 1051-1055. The defendant contended that as only the worse (left) ear at high frequencies showed a significant notch or bulge, and there was little or no trace of noise induced hearing loss in the better (right) ear, then there was only a possibility of noise induced hearing loss, not a probability. This is contained in Note 11 of the Coles guidelines. As such the defendant submitted that the claimant did not overcome the evidential hurdle of proving causation on the balance of probabilities. Cross examination During cross examination Mr Lancer agreed that the 1984-1990 audiograms showed significant asymmetry and by reference to Note 11 of the Coles guidelines this created a possibility rather than a probability that the claimant s hearing loss had been caused by noise. However, he relied upon the Fernandes paper which concluded that an asymmetrical hearing loss could be caused by all over noise exposure. This led Mr Lancer to conclude that the claimant had probably suffered noise induced hearing loss from exposure in the workplace. Mr Parker s evidence however was that in view of the asymmetry and Note 11 of the Coles guidelines, noise induced hearing loss was a possibility, not a probability. Mr Parker criticised the Fernandes paper. His first criticism was that the definition of asymmetry was a very low hurdle for describing an audiogram as asymmetric. Fernandes and Fernandes defined asymmetry as a minimum of a 15 decibel difference at any one frequency between 0.25 khz and 6 khz. They also sought to compare their paper with the paper by M.E Lutman & R.A.A. Coles Asymmetric sensorineural hearing thresholds in the non-noise exposed UK population: a retrospective analysis, (2009) Clin.Otolaryngol. 2009, 34, 316-321. Mr Parker considered this approach to be flawed as the definition of asymmetry in the Lutman paper was a much higher hurdle for the diagnosis of asymmetry and the cohorts used in the two papers were incomparable. Judgment In her judgment, HHJ Staite preferred the evidence of Mr Parker which she described as being innately more rigorous 04

and methodical than the evidence produced by Mr Lancer. Applying the Coles guidelines she was satisfied that the audiograms between 1984 and 1990 provided no direct evidence of noise induced hearing loss due to the application of Note 11. In relation to the research papers relied upon by the claimant she did not find that they provided a sufficiently cogent analysis of asymmetric hearing loss. The conclusion of the Fernandes papers was not sufficiently sound to persuade the court that symmetrical noise exposure might on the balance of probability cause asymmetric hearing loss. Contacts If you have any queries or require advice on any of the matters discussed in this issue, please see contact details below: Anthony Baker anthony.baker@plexuslaw.co.uk DDI: 0844 245 4202 Whilst this is only a first instance decision (and presently unreported), it is a useful decision for defendants to refer to in cases where the claimant has an asymmetric hearing loss. It should be remembered however that the Coles guidelines do envisage some instances when the presence of asymmetry may be consistent with noise induced hearing loss. These instances have varying degrees of probability and reference must be made to Note 11 of the Coles guidelines. HHJ Staite helpfully sets out these instances in paragraph 18 of her judgment Click here for a copy of the judgment. For further information contact: Ruth Quinn details opposite Laurence Ives laurence.ives@plexuslaw.co.uk DDI: 0844 245 5343 Ruth Quinn ruth.quinn@plexuslaw.co.uk DDI: 0844 245 5399 Karen Scott karen.scott@parabis.co.uk DDI: 0844 245 5235 05