More Civil Justice ? The impact of the Woolf reforms on pre-action behaviour – a brief summary

This report, published jointly by the Law Society and the Civil Justice Council, is the first substantive research to be completed on the effect of the Woolf Reforms implemented on 26 April 1999. It is a useful study on how pre-action behaviour has changed, if at all, following the implementation of the Civil Procedure Rules. However, it does concentrate entirely on three areas of work; personal injury, clinical negligence and housing claims and the comments below should therefore be read in that context. The only area of practice which could be said to be at all akin to our own is clinical negligence given that the claims are often complex and of high value. The actual report is 420 pages long and what follows is a summary of the findings identified as being of interest to us.

Introduction

The study was based on two different sources; firstly, interviews with 50 lawyers, insurers and claims managers, of whom 30 specialised in personal injury work, 12 specialised in clinical negligence and 12 specialised in housing disrepair. In relation to the personal injury work, the authors also studied a 150 claimant solicitor files concluded before April 1999 and 150 opened by the same firms after April 1999 and concluded at the time of the study. Clearly, given that the research was undertaken within the first two years of implementation, the study invariably has focused on small, quickly resolved personal injury claims.

Themes

In very general terms, the following trends have been identified;

• Greater specialisation.
• Greater particularisation of claims from the earlier stage.
• Litigators prefer clear structures. The protocols, therefore, have been well received and, specifically, clinical negligence specialists like the standard form for pre-action disclosure.
• Cost - it has proved very difficult to make litigation cheaper.

Overall views of the Woolf Reforms

• The interviewees gave an overwhelmingly positive response to the CPR.
• Part 36 Offers were being identified as being particularly successful.
• Cases are better prepared thanks to the requirement for the early exchange of information. This had a knock-on effect on settlements which were easier and happening earlier.
• The litigation culture was perceived to have changed in that there was a greater willingness to co-operate (given that failure to do so would be punished by the courts) and generally respondents had a better relationship with their opponents.
• On the downside, a certain “dumbing down was perceived in the insurance industry given that many insurance companies were pursuing lower value claims in-house. Often, due to attempts at costs cutting, very junior staff were employed to undertake this work.
• The lack of sanctions for failure to comply with limits and protocols and court orders was identified as a problem.

Costs

• There is a general perception that costs have increased since the implementation of the CPR. This is caused by the increased amount of “front-loading which has had to be undertaken to comply with the various protocols. The converse of this is that settlements have been seen to be brought about more quickly and therefore costs could be seen to more “justified. In relation to smaller claims, the increase in costs is more lamentable given that a large amount of investigative work is often required to be carried out despite the fact that the matter would probably have settled fairly quickly in any event.
• It was felt that given the unyielding timetables in fast track and the escalation of costs following issue, there was often insufficient time to reach a settlement.
• Interim costs schedules were picked out as being time-consuming and expensive to complete and often not relied on by the court.
• The concept of proportionality was often referred to by judges. However, criticism was levelled at them for applying that concept blindly and not taking into account that the defendant’s conduct can often increase costs. This should be reflected in costs orders.
• Comments were made that the costs were causing more arguments than before, perhaps because of the variations in costs orders made.
• There is certainly an increase in the number of attendances at court given that matters that were formerly agreed by consent (especially those that were the subject of case management conferences) were now being decided at hearings. Parties were therefore incurring the costs of the day in court together with the costs of preparing costs estimates.

More Protocols?

It was generally agreed that more protocols should only be introduced if a specific need arose. Practitioners found that they were able to adapt those in use to suit each case.

Counsel

It was perceived that there was less reliance on counsel since the introduction of CPR. Solicitors are generally more selective about their use of counsel, and given that firms are becoming more specialised, much of the drafting is now done by solicitors.

Experts

• Those known to be partisan are on whole no longer instructed.
• Solicitors are much more cautious about what enclosures they include in their letter of instruction given the possibility that they may be revealed to the other side. However, in relation to clinical negligence claims, it appeared that the pool of available experts had been noticeably reduced.
• Joint experts on liability are still relatively rare but joint experts on quantum less so.
• In order to get value out of experts’ meeting a good agenda was required.
• In large multi track cases, it is still common practice for each side to commission their own key experts.
• It was often difficult to obtain follow-up information from a jointly instructed expert.
• It was generally felt that experts were less partisan and were instructed in a more neutral way.

Settlement

• More realistic sums were being put forward in Part 36 offers which then resulted in settlements.
• Settlements were seen to be being reached through discussion rather than attrition.
• Settlements were more informed given that they were arrived at as a result of information exchanged rather than tactical negotiation and horse-trading.
• Settlement was seen to be reached more quickly and far more were happening at the pre-action stage.
• There was perception that the speed of the fast track has resulted in many more settlements pre-issue given the huge escalation in costs as soon as the claim form is served.

For further information, please contact Tim Hardy at [email protected] or on +44 (0)20 7367 2533.