Most firms do not need us to tell them that the world of whiplash claims will change for all time at the end of May 2020. The new rules flow from the changes set out in the Civil Liability Act 2018. As far as costs are concerned the major changes concern the Small claims Track. The upper limit for damages in RTA cases rises to £5k, and to £2k in other personal injury cases. The new limit sits alongside draconian reductions in the levels of recoverable damages that are set out in a tariff. The maximum recoverable for general damages for a whiplash injury under the tariff is £4345. You don’t need a degree in maths to see that the combined affect is that almost all whiplash cases will be allocated to the Small Claims Track, making it virtually impossible to recover costs.
It is worth noting that the new rules only apply to accidents after 31st May 2021 and not claims after that date. So, for up to three years, there will still be a significant number of cases being brought under the existing regime.
This is leading many firms to consider moving into different areas of work. One area that is becoming popular is housing disrepair or more accurately housing conditions since the enactment of the Homes (Fitness for Human Habitation) Act 2018. This work does have costs rules that make the work attractive.
CPR 26.6 provides that a case will not be allocated to the Small Claims Track where a tenant is claiming against a landlord in relation to housing conditions. If the tenant is seeking an order requiring the landlord to carry out works then the case the case will be allocated ton the fast track if –
1. The cost of outstanding works exceeds £1k or
2. The value of other claims exceeds £1k
Note that in both cases, there must be an ongoing claim for Specific Performance.
If the claim is limited to damages only, then the usual small claims limit of £10k applies.
What about cases that settle before proceedings? S11 of the Pre Action Protocol for Housing Conditions Cases entitles the tenant to costs.
“If the tenant’s claim is settled without litigation on terms which justify bringing it, the landlord will pay the tenant’s reasonable costs.”
One problem that can arise is there repairs are dome after a letter of claim that reduce the value of the case below the small claims limit. This scenario was dealt with by the Court of Appeal in Birmingham City Council v Lee  EWCA (Civ). The council carried out the works and refused to pay the tenants costs. She was awarded costs to the date the repairs were completed –
“The tenant who has a justifiable claim for disrepair needs legal assistance in advancing it. He must initiate it in accordance with the protocol. If the effect of the claim is to get the work done, then providing that the landlord was liable for the disrepair the tenant ought to recover the reasonable costs of achieving that result.”
“What is necessary in a case of this kind is that the claimant should, providing she is right about liability, recover the reasonable fast-track costs of advancing the claim by way of letter under the protocol, and thus getting the work done. In this case the work was completed by 26 September 2006. We would accordingly replace the order made by the judge with the following:
“Pursuant to CPR 44.9(2), the claimant shall have her costs in the cause on the fast-track basis up to 26 September 2006.”
We anticipate a huge growth in this work over the next year or so.
As we head towards an unknown future we will continue to monitor changes and are available to assist any firms that require our help.