Plans for further Whiplash Reforms Shelved by MOJ

The very idea of a local or central Government consultation, is usually met with a cynical tut, a roll of the eyes and the question:  whether it is a genuine consultation or a fait accompli?  However, in what will doubtless be seen as a shock move to the personal injury and credit hire sectors, the Ministry of Justice have recently responded to a 5 year old consultation process with the ditching of plans for further whiplash reforms. See Part 2 of the Government Response to: Reforming the Soft Tissue Injury (‘whiplash’) Claims.

Despite a chorus of objections, overwhelmingly from the claimant sector, May 2021 saw the implementation Part 1 (raised financial value limit for the Small Claims Track and introduction of fixed tariffs for compensation for RTA whiplash claims) of what was anticipated to have been only the first of inevitably further whiplash reforms to come. Part 2 was wider in scope, including proposed reform in the areas of credit hire and rehabilitation arrangements, referrals and qualified one-way costs shifting (QOCS). However, in its response to the Consultation, the MOJ have revealed that, whilst it will continue to monitor the situation; it will allow the market to deal with issues around fraud and claims costs and not push ahead with proposals for reform of:

• Credit hire;
• Rehabilitation costs;
• Change of QOCS provision, rejecting proposals for a requirement of Court permission to discontinue a claim within 28 days of trial;
• The naming of referral source within the Claims Notification Form, and
• Further restrictions on the recoverability of disbursements.

In the run up to and following Part 1, it will have been observed that there has been a repositioning of particularly the legal sector, with sales, mergers and some departing the market. The MOJ jettisoning of the Part 2 proposed reforms will likely be perceived as a welcome turn of the books particularly to the claims industry, which in consequence will lead to PI, credit hire and rehabilitation claims to defend against.

1CL has a team of experienced civil fraud practitioners and are one of only three London sets appointed to the Aviva panel.