This article is published as part of Capsticks’ Insurance Review 2023.  

From 1 October 2023, fixed recoverable costs (FRCs) are now introduced for money claims valued at over £25,000 up to £100,000. The new regime applies to personal injury claims where the cause of action accrues after 1 October 2023 and disease cases only if a letter of claim has not been sent prior to that date. A new ‘intermediate track’ is created.

Clinical negligence claims are not excluded if breach and causation have been admitted, provided one of the exceptions in the new CPR 26.9 (7c) does not apply (e.g. no more than two experts per party, trial no longer than three days).

A further consultation launched on 21 July proposes that in clinical negligence cases the admission of liability must be made in the Letter of Response. The closing date was 8 September 2023.

Where a party or witness is considered ‘vulnerable’ the courts have power to determine at the end of the case whether the vulnerability caused sufficient extra costs to take the matter outside the regime.

The government has announced that fixed recoverable costs will be introduced for clinical negligence claims valued at up to £25,000. The new regime is expected to come into force in April 2024. Its focus is early exchange of evidence followed by a mandatory ‘stock take’ by the parties. If the matter is not resolved following the ‘stocktake’ phase it will proceed to neutral evaluation (by an experienced legal professional). Defendants will be responsible for paying the costs of neutral evaluation. Claims that cannot be resolved without litigation will be governed by a new Low Value Clinical Disputes protocol. They will be allocated to a ‘standard track’ unless suitable for the ‘light track’ (where the circumstances of the incident are such that it is anticipated that liability will not be disputed or that it can be resolved quickly, e.g. a ‘never event’).

A further consultation has been launched (closing 27 October 2023) to address whether disbursements such as court fees should be included within the fixed costs.

Comment

The new provisions for claims valued at over £25,000 up to £100,000 will make early investigation, assessment of evidence and decisions on the viability of defending ever more crucial.

The case of Somoye (reported below) emphasises the care that needs to be taken before an admission is made, as this may be irreversible.

Following the October rule changes we may see more arguments at CMCs around the exceptions to intermediate track allocation. For all personal injury cases, the changes will address the often disproportionate costs to damages ratio in claims of modest value.

The regime for clinical negligence claims up to £25,000 is designed to achieve better proportionality of legal costs to the value of the damages claimed. Once in force it will be interesting to see the stage at which cases settle and the extent to which the government’s dual aim of “speedier justice” is achieved. According to the consultation response, the government thinks there will be few claims that will need neutral evaluation as the majority will have been resolved by then.

Insurance Review 2023

This article is part of Capsticks' Insurance Review 2023.

Read the other articles featured in this publication below:

• Spotlight on three appeal court decisions
• Appeal decisions pending
• Fundamental Dishonesty – ‘good days and bad days’ defence rejected
• Two important changes to the fixed recoverable costs regime
• Defendants’ ability to recover their costs from claimants extended
• Pre inquest admissions fatal to defendant’s case
• Personal Injury Discount Rate (PIDR) review update

Get in touch

Aiming to be the firm of choice for medical malpractice and general liability insurers, we advise and support on all aspect of claims and inquests.

To discuss how any of these issues may affect your organisation, please get in touch with Majid Hassan, Ed Mellor or Sarah Bryant or Cheryl Blundell.