This month, one of our solicitors responded to the Ministry of Justice’s call for evidence, on behalf of the firm, on package holiday claims.
A short while ago the government announced plans to change the costs rules to clamp down on the growing market in holiday sickness claims and tackle their apparent increase. What wasn’t perhaps also entirely clear was that these proposals also include taking action to address package holiday personal injury claims in general, not just gastric illness claims.
As part of these measures the Ministry of Justice published a call for evidence covering the following issues:
- The problem of an apparent substantial increase in the number of low-value personal injury (PI) claims for gastric illness (GI) arising from package holidays, many of which appear to be unmeritorious.
- Action the government proposes to take to control legal costs by extending fixed recoverable costs (FRC) to low-value personal injury claims arising from package holidays.
- Amendments to Pre-Action Protocol for Low-Value Personal Injury (Employers’ Liability and Public Liability) Claims.
- Issues that we are asking the Civil Justice Council to consider in relation to package holiday low-value personal injury claims and other low-value personal injury claims more generally.
- A call for further evidence including data.
As a firm, we do not generally conduct gastric illness claims, however, we do conduct package holiday claims and as such we are well placed to confirm our experience that these are not easy claims to investigate. Although a claim can be brought under English law in the English Courts, the standard of liability falls to be determined on the basis of the local standards for the Country and area where the accident occurred, at the time of the accident (or on the date of construction of the building where building regulations are concerned).
This is not just a question about what laws apply in the Country where the accident occurred. It is also necessary to identify what the local standards are with reference to any local custom and practice or health and safety guidance.
Such local standards reports are neither easy nor straightforward to obtain. Nor is it easy or straightforward to identify suitable experts to provide these reports. These reports are required from lawyers or engineering experts, depending on the accident circumstances. There is no expert database for them. CPR Part 35 requirements must be explained to each expert to ensure a CPR compliant report, to assist the Court.
Even once a local standards report is obtained, it can be very difficult to investigate liability in terms of obtaining documents from Tour Operators. Those Operators often do not have control of the relevant documentation that would normally be ordered by the Court for standard disclosure on liability. The English Courts can only compel Parties within their jurisdiction to provide documentation which is in their control. For third parties (such as hoteliers) who have control of those documents, an Application can only be made under CPR Part 34 to obtain documents from an entity domiciled in an EU Member State (currently – this could be impacted by Brexit in due course). For jurisdictions outside of the EU other conventions may apply, but in order to identify the same, this would inevitably require further investigation, taking additional time and increasing costs necessarily.
The Government seem to consider that although a system to control costs already exists for most personal injury claims in England and Wales (i.e. the fixed costs regimes), a loophole is being exploited in foreign holiday claims. Their proposal is to amend the pre-action protocol for low-value personal injury claims in order to bring these claims within the existing fixed recoverable costs regime.
Ministers stress that the ‘vast majority’ of holidaymakers who do not make false claims will still be able to claim damages, but the changes will reduce the chance of bogus claims and keep the costs of holidays from soaring.
Justice Secretary David Lidington said: ‘Our message to those who make false holiday sickness claims is clear – your actions are damaging and will not be tolerated. We are addressing this issue and will continue to explore further steps we can take. This government is absolutely determined to tackle the compensation culture which has penalised the honest majority for too long.’
The government says advice from the travel industry shows the upsurge of claims in the UK – reported by the industry to be as high as 500% since 2013 – is not seen in other European countries, raising suspicions over the scale of bogus claims and damaging the UK’s reputation overseas.
These changes seem inevitable and a new fixed costs regime could be brought in for all package holiday claims as early as April 2018. However, by responding to the Government’s call for evidence as a firm, as we hope other firms have, perhaps changes can still be made to the Government’s plans, to help the vast majority of Claimant’s who make honest claims, to be able to continue to do so.