Had an accident? You must have been injured!

I was at a local sports centre with my son recently when the owner of the centre came over to me and said;

"Hi Carl, I believe you know something about this 'No Win, No Fee' stuff?"

I said that I had had some dealings with it.

So my friend went on;

"Well I had a minor bump in my car the other day - old chap reversed into me whilst I was stationary. He was very apologetic and we exchanged details and went on our separate ways. Anyway later in the day I got a call from some claims company asking if I wanted to make a claim."

"Go on then", I ventured, pretty much certain what was coming next.

"Well" my friend replied, "they asked if I was injured, and I told them that I wasn't, that the accident was very minor. Anyway they told me that injuries are not always obvious immediately after the accident and that it was possible that over the next few days I might start getting neck and back problems. I told them that it was a really minor bump and that I was fine. However they persisted and said that everyone has some injury after an accident and they said that I would probably get at least £1500. They said that it wouldn't cost the other bloke anything, that it was just his insurance company that would have to pay out and that he would have lost his 'no claims' bonus anyway. What should I do?"

"Were you injured - have you got any symptoms of injury?", I rather wearily asked.

"No", came the anticipated reply.

"Then you have answered your own question about what you should do", came my final response and with that he nodded and went back to his exercises.

I'm not blaming my friend for asking the question. After being told in a round-about way by this company that it was fine to make a claim for injury even when he hadn't suffered any, he was entitled to see whether this was commonplace or even accepted practice. I could have told him that it was unfortunately quite commonplace, that this was what the industry that I first practiced in as long ago as 1987 had come to in many instances, that there were too many lawyers and claims companies trying to compete over a limited number of claims involving genuine injuries and that his experience was an example unfortunately, of what can happen as a result. Fortunately my friends conscience had told him what the right thing to do was. I didn't need to say anything more.

Is The PI Referral Fee Ban Working?

                                                                                  

                                                                                

Just over 3 months have elapsed, at the time of writing, since the PI referral fee ban was introduced courtesy of ss56-60 of LASPO 2012.

 It is a matter of great doubt whether anyone reading this article really thought that referral fees would die away entirely when April 1^st came around. PI lawyers and CMC owners are nothing if not inventive and it was never in doubt that some forms of referral fees would continue – albeit that they would be re-branded as ‘recommendation fees’, ‘agency fees’ or some other such title that does not include the word ‘referral’ in it.

Prospective ABS’s were not, we were told, likely to be granted licenses if it appeared that they were solely designed to get round the ban. So presumably the SRA are perfectly happy that those to whom they have granted such licenses are not acting in a manner which would suggest that they were set up with the sole purpose of circumnavigating the ban.

For everyone else, what is the current situation? In the lead up to April 1^st and since then, there have been many pronouncements from CMC’s, in particular, via social media, publicising the fact that they ‘have found a solution to the referral fee ban’. Without going into great detail about the ‘solutions’ that are on offer, what can be said is that some involve quite complex paper trails between the various parties to the ‘solution’  – a mixture  of solicitors, CMC’s, a client and a form of marketing company or some other party. Other ‘solutions’ involve the referrer passing the prospective personal injury client on to the solicitor by way of a ‘hot key’ transfer – with no information being passed on by the referrer to the solicitor directly, presumably in an attempt to avoid falling foul of s56 (5) (b) of LASPO 2012 (referral of prescribed legal business). These are but two of the types of ‘solution’, ‘scheme’ or ‘arrangement’ that have come to the writers attention. There are doubtless a good number of others.

Whether any of these ‘solutions’ will pass muster with the SRA or the MoJ, remains to be seen.

What is apparent is that whilst there was a definite mood of bullishness (‘it will be business as usual’) among some claimant solicitors and CMC’s alike in the run up to the ban, that bullishness has been replaced with a much greater degree of cautiousness . There is a sense that many are waiting to see what the others do before making their own moves (if any) and with good reason.

The SRA published a 31 point set of guidance notes on the 25^th March on its website at: http://www.sra.org.uk/solicitors/code-of-conduct/guidance/guidance/Prohibition-of-referral-fees-in-LASPO-56-60.page

The guidance notes set out some examples of the types of ‘solution’ that may or may not lead to a breach. In the examples contained within the guidance notes, the ‘may’s outnumber the ‘may not’s’ considerably and throughout the notes the SRA’s stance is made consistently clear – any payment made in relation to a personal injury claim will be considered to be a referral fee unless the solicitor can prove otherwise. In other words, if it looks like a referral fee, sounds like a referral fee and smells like a referral fee, the SRA will consider that it is a referral fee and if it comes to the attention of the SRA it will be for the solicitor to prove to the SRA or perhaps more likely, the SDT that it is not a referral fee. It will be a brave solicitor who wants to be one of the test cases to have to argue before the SRA/SDT why he or she believes that his or her particular ‘solution’ does not breach the ban!

To an outsider looking in, it must seem insane that any solicitor worth his or her salt would even consider making a payment for a PI claim under any circumstances, however the referral and payment were packaged or re-branded  given that the burden of proving that the payment is not a breach of s56 weighs so heavily on the solicitor’s shoulders via OFR (Outcomes - Focused Regulation).

The problem for many firms of solicitors is that they have become so wholly reliant on paying referral fees for all, or most, of their PI work that they are not used to obtaining work via any other media and have never before undertaken any other real form of marketing of their own. Perhaps some really did think that, despite the writing having being on the wall from as long ago as since the beginning of 2012 at least, that ‘J day’ as April 1^st became known amongst PI lawyers, was never going to happen. For those solicitors, cutting the umbilical cord of 'paid for' PI  referrals from CMC’s and the like was always going to be extremely difficult and potentially terminal to their businesses. Hence the reason that a number of solicitors seem prepared to take the risk of attempting to see if there is a way round the referral fee ban, even if it is a risk that is fraught with danger.

Those firms that some time ago decided to do away with the referral fee model, re-organised their businesses (including where necessary, downsizing their firms) and started to market for work themselves as opposed to relying on ‘paid for’ referrals, and indeed those who chose never to go down that route at all, must be giving themselves a pat on the back. It will only be a relatively small ‘pat’ – there are still plenty of other challenges ahead given the onerous nature of the other reforms already in place, those due to come in soon and those still to be decided upon, with, amongst the latter group, the raising of the small claims personal injury limit to £5000 or more, the one perhaps giving the most cause for concern for claimant PI lawyers.

Your Prison Cell Awaits....

                                                                             


Occasionally, at the end of a criminal trial, when a prison sentence has been handed down, the Judge will defer the start of the sentence for a couple of weeks to allow the Defendant to get his personal  affairs in order. I remember that happening to a solicitors clerk in a practice not far from where I was brought up in the North West of England who along with others in the practice had been sentenced to a couple of years for 'Green Form' fraud. I recall thinking how awful that must be - being allowed to walk out of the court room to go home, knowing that you had a 2 year sentence waiting to start in 2 weeks time.

It's been a similar situation for RTA lawyers over the past however many months. They have known that a prison sentence awaits them on April 1 2013, but as it all still seemed a life time away, things carried on as normal. Even when it became certain that referral fees were going to be banned - bluster and bravado ( "oh it will be business as usual, ha ha.") More recently the laugh has become a nervous one and then on Monday 19th November, the laughter stopped altogether -the fixed fee under the Portal slashed from £1200.00 to £500.00 (unless the Law Society who are 'raising concerns' can weave some magic - ok, you can all start sniggering again).

Why there isn't even enough left in the pot to pay a dodgy referral fee!

As if that wasn't bad enough, those who suddenly thought that overnight they could become super EL/PL lawyers, woke up to find that that was being dragged into the whole sorry scheme too, albeit at slightly better rates (but not significant enough to get the cheque book out for a down payment on that new Porsche).

It's been interesting, hearing all the news on the grapevine about solicitors and CMC's who have supposedly found unique ways around the referral fee ban with opinions from Rumpole QC confirming that they have a cast iron scheme. Pray, do tell, so we can all have a good laugh. Goodness knows we need one. In any event could Counsel please advise which 'pot of gold' the cast iron 'referral fee by any other name' is going to come from?

I may be mad, but I still believe that this is a time of opportunity for some and by that I don't just mean for the big boys and girls. Firms will have to re-structure, no doubt about that. There will be casualties. CMC's who have nothing to offer other than buying in and selling on claims will disappear, go into PPI or become debt management companies. CMC's that are in reality old fashioned Credit Hire companies by any other name, will still be able to make a living from providing hire facilities (yes I know that there is the OFT thing hovering around, but let's deal with that as/if/when it comes around - we've got enough to deal with at the moment). Solicitors, cosy up to them and network with others. There is nothing wrong with you working in an informal relationship as long as you don't share fees and don't pay referral fees and maintain a professional approach, is there? The old fashioned 'good service' quality might come to the fore in terms of selling yourselves (not literally).

...and start marketing like you never have before - network - think outside the box. On the technical side of things there are legitimate ways to get matters out of the Portal on many claims. Be sharper than the opposition and competitors in the handling of your claims. Do you have a lot of claims that include credit hire charges as part of the Special Damages claim? Are you still allowing most of those claims to stay in the Portal? If so why?

So, PI solicitors, the future is difficult but for those prepared to roll their sleeves up, there is a future. RTA/PI lawyers have proved in the past they are a resilient lot. Now is the time to show that quality again.

If you need some help not just with marketing your firm but with advice on re-structuring and how to move forward in 2013 and beyond please feel free to email me at carl@carlwaring.com Unlike many legal marketing experts, I have the experience not only of 28 years specialising in RTA/PI work, but of having built up my own practice from scratch and turning it into a successful and thriving business. I know how difficult it is sometimes to see the wood from the trees when you are running a practice and I now have the benefit of having had the blinkers taken from me, having sold my practice some years ago.

That prison cell does not have to have your name on it.....

Yawn Yawn. Jackson and all that...

I've been a little quiet recently in terms of tweeting and blogging on LASPO, Jackson and all that. To be honest I am a bit weary of it all...all the speculation and jaw jawing, of listening to possible ways of getting round the ban (not supposed to be looking at ways of doing that are we; thought we were just meant to comply?). Of course we all still await the definitive definition from the SRA as to what consitutes a 'referral fee'.

A formal consultation process conducted by the SRA started on the 23rd October and will end on the 18th December. There is to be an 'SRA Referrals Symposium' (to be held at the Royal Albert Hall?). Code changes are to be approved by the SRA Board on the 23rd January 2013, changes to the Regulatory Framework will be approved by the LSB mid February 2012, final version published 'early March 2013' and Implementation of the ban - April 2013.

Reading about the Consultation on the SRA website is making my contact lensed eyes water, so you can check it out for yourselves at www.sra.org.uk/sra/consultations/referral-fees-2012.page if you like. It might make your eyes water too.

I hear it being said by many, and indeed to avoid being accused of hypocrisy, I have also sounded off to this effect previously, 'how can we possibly plan for the future when nothing is written in stone?'. I still believe that to be true for instance in the case, for example of what the fixed fee under the RTA portal will come down to  (I believe that at the recent MASS conference many delegates were saying that they believed that the fee will not come down to the oft quoted figure of £400, but is more likely to be fixed at double that).

However, the one thing that is certain is that referral fees will be banned, that is that LASPO 2012 as implemented in April 2013 will prohibit the 'payment and receipt of referral fees in personal injury cases'. I do not see that the SRA is going to provide much more in the way of a deeper definition. Indeed it has already said that it does not intend to provide a blue print for firms. It will rely on self-regulation to a great extent and to my mind it will boil down to this - at the moment Mr/Mrs/Ms RTA/PI Solicitor you receive quite a bit/some/an awful lot of your work by paying a referral fee to a CMC/Insurance broker or to some other organisation to receive a personal injury claim - ie you pay £X for a PI or you pay £XXX to receive 20 claims a month or whatever. After the first of April that will not be allowed and you can dress it up in fancy ways, but it will still be banned, and you know that it will be banned, so don't do it. If you do do it, well first of all, remember that you are under a duty to self report breaches of the SRA Code of Conduct. If you don't report yourselves, you might get away with it, or we might catch you - that is a risk that you may or may not wish to take. However you know the Rules and so if you do decide to be naughty, well you will be looking over your shoulder for the rest of your days (or until the ban is relaxed/collapses in farcical fashion or is otherwise done away with - all of which are possible, but not certain). You can wave leading Counsels opinion on some brilliant new scheme that you have come up with as a way of getting round the ban, at us, but ultimately if it involves making a payment for a PI claim, it is banned. End of.

So there you have it. What you can do is go out and market properly and attract clients that way, but you'd better get going seriously if you haven't started already - and don't expect those 100 guaranteed new cases per month that you are getting at the moment by paying XYZ CMC Ltd £75,000 a month - no, no, no, that is not going to happen, certainly not in the near term (or to be honest in the long term). Alternatively you can form an ABS - but that is a separate issue altogether and provides enough material for 20 more blogs.

Anyway, I have just heard the theme tune to 'I'm a Celebrity, Get Me Out of Here' chiming up, so time to go and watch Nadine Dorries getting bitten by some more rats or submerged in a bath of maggots. Maybe ITV could try an alternative theme "I'm a PI Claimant Solicitor - Get Me Out of Here." At £40,000's worth of appearance money - now, there's a thought. That would buy an awful lot of claims (until 1st April 2013)!

As ever all of these off the wall views are my own in their entirety.

The Referral Fee Ban & The SRA - The Reluctant Police Force

An article in the Law Society Gazette today by John Hyde "SRA Ponders Policing of Referral Fee Ban" http://www.lawgazette.co.uk/news/sra-ponders-policing-referral-fee-ban confirms to me that the SRA have been landed with the role of an unwilling police force to deal with the ban which is to come into effect in just over 7 months.

According to Hyde, the Authority "will set out within weeks how it intends to police the forthcoming ban on referral fees." 'Within weeks' - really? Sorry, for some reason 'My SRA' keeps coming to mind. What a wonderfully thought out and executed concept that was. Perhaps first the SRA will have to have a consultation period of 3 months to consider what is meant by a 'few weeks'. Then after that it might come to the conclusion that 'a few weeks' actually means about 12 months - and even then give or take another 12 months either way - well not either way - just one way. So make that 2 years. Perhaps then we should add in some fancy online software to help with the policing. Add 12 months for that to be implemented and then - oops - it's crashed.

After that, according to the article, the Authority will 'draw up a formal policy position in advance of a 12 week consultation starting this autumn.' '12 weeks'? Don't even let me start going there. Perhaps the idea is to just send us all mad. I can see it now - the ambulances collecting us all to be dragged off screaming and shouting  to the 'Home for Bewildered Claimant Solicitors and CMC Proprietors' (with segregated wards to ensure that no referral fees can be passed on in the exercise yard).

I jest merely - well partly.

The SRA has been given the legal equivalent of a 'hospital pass' in rugby or football. The only alternative was for the 'Ministry of Silly Claims' to become involved and of course the government just wants to lay down the law, in a fashion. It doesn't want to have the job of enforcing it's hotchpot of legislation - and who can blame it?

Anyway once this has all been smoothly implemented - whatever is being implemented, we then only have to wait on the announcement on the Small Claims Track Limit for Personal Injury, the slashing of portal fees, etc, etc. Not to worry - we've got all of 7 and a bit months for this to get sorted.

Anyway at the end of the tunnel there is light - that pot of gold called the "ABS." Why some 15 have been authorised, don't you know - or is it 20? I really don't know. To be honest I've lost the will. Apparently there is now something called the "ABS rush." Now that does sound interesting. Is it a form of legal high? Better be on the safe side. "Pass the port Miss Moneypenny - and make mine a double."

The Sword of Damocles

In recent posts I have been rather critical of RTA/PI solicitors in general for what I have seen as a "burying the heads in the sand" approach to the forthcoming changes in their industry, changes which if fully implemented as proposed by the government/insurance lobby will potentially prove fatal to the arm of law that I grew up with in the legal profession from as long ago as 1984.

I have recently met up with some friends and former colleagues who are running their own PI practices in different parts of their country and have spent many hours over the past few weeks discussing life at the coal face. I was struck by their stoicism, phlegmatism and realism. The overall message that I received was that they were carrying on as normal because, as one solicitor said to me, "What else can we do? Until we are told in definitive terms what the new landscape will look like and when that landscape will be repainted, how can we make firm decisions to do anything other than what we are doing?"

What they are doing is continuing to work very hard indeed to run their firms, to provide a good service to their clients, to try and maintain a steady influx of work,  to provide employment and a decent working environment for their employees, whilst at the same time ensuring that they are filtering out any potential fraudulent claims and coping with ever increasing and burdensome regulation and red tape. They are too busy getting on with running their businesses to spend time worrying about proposed future changes to their industry that have been either so long in the "proposal" stages or in other cases have just been suddenly plucked out of thin air, with still no definitive shape or form to them and still with no dates in sight as to when these proposals will emerge from their embryonic state, other than to hear that the government expects to implement them by April 2013. It is like watching an egg slowly starting to hatch and not knowing what being will eventually emerge from it.


As one Senior Partner put it to me; "We must be the only industry with other people dictating to us how to run our businesses (including what price to sell our services for) and having the sword of Damocles hovering constantly overhead!"

In The Court of The King

It is the year of 2014 in a far off land. A junior prince has been elevated to the post of 'King of the Realm' by the all powerful 'Council of Insurance Lords' in recognition of his great work in defeating once and for all, the Claimant Peasant’s Revolt that had been plaguing the land for 25 years or more.

Setting: The King’s Palace   

                                                                          

The King is reclining on a settee watching the Jeremy Kyle programme on TV, whilst being fed grapes by two of his servants.

A courtier enters the room.

Courtier: “Sire, the Chief Insurer is here to see you.”

King: “About time too, he was supposed to be here an hour ago. Send him in.”

The courtier leaves the room and after a few moments, re-enters, followed by a plump man with a heavy sun tan.

Courtier: “Sire, the Chief Insurer.”

The Chief Insurer walks over to the King, and thinks about bowing, but decides against it.

Chief Insurer: “I apologise for my tardiness Sire, but I was waylaid by claimant beggars outside the Palace, who pulled at my fine clothes and tried to sell me personal injury claims.”

King: “But I thought I banned referral fees last year?”

Chief Insurer: (muttering) “WE banned referral fees!”

King: “What was that you said?”

Chief Insurer: “Oh nothing Sire, I was merely clearing my throat. Yes, Sire. We, I’m sorry, you did ban referral fees and for that, I and my fellow Insurance Lords are most grateful, but there are a minority of peasants who flout the law and roam the land trying to sell claims.”

King: “You told me that the claimant rebellion had been crushed and in any case, as we reduced solicitors fixed fees under the portal to £50 and raised the small claims track limit for PI’s to £100,000, there seems no point in the peasants trying to sell claims anyway.”

Chief Insurer: “Sire the rebellion has been crushed, but there remain a few renegades to be rounded up, and  some of these older claimant peasants they have been around for so long that they know of no other means of making a living.”

King: “No matter, now pray tell me, what is the news of the reduction in the cost of motorists premiums since I got rid of the claimant peasants and their fraudulent claims?”

Chief Insurer: “Sire?”

King: “The reduction in motorists insurance premiums! That is what you promised me would happen once I had won the war against the claimant peasants. You sold me the idea that if claimant peasants no longer blighted this land with their fraudulent claims and referral fees, that that would mean that the cost of insuring a motor vehicle for the average peasant, I mean motorist, would fall significantly due to the costs savings that would be made.”

Chief Insurer: (fidgets with the collar of his rather tight shirt) “Yes Sire, we do hope to achieve that..eventually. “

King: (Loudly)” Eventually! What do you mean eventually? What HAS been the saving?”

Chief Insurer:  (Fidgets with collar even more) “Well Sire, to date there has not actually been any saving.... (Gulps) in fact premiums have risen by 50% over the past 12 months.”

King:  (Roars) WHAT?

Chief Insurer: (Beads of perspiration now trickling down face) "Well Sire, you see we have had to pay heavy bonuses to the Insurance Lords, as a reward for their efforts in.... assisting you in defeating the claimants and ...and...we have of course had to reward the insurance peasants for all their hard work."

King: (Enraged) "Bonuses! I defeated the claimants single handed without any assistance from the Insurance Lords and as for the insurer peasant workers, you always told me that the majority of them were a useless, inefficient bunch!"

Chief Insurer: " Indeed Sire, the insurer peasant workers I did refer to in such terms, but they threatened that unless they were rewarded with some of the bounty - I mean savings in costs - that they would work to rule and instead of taking six weeks to deal with the post, they would take twelve.. .. and in addition Sire, there is another problem.."

King: (By now purple of face) “What other problem?”

Chief Insurer: “Well Sire, the remaining claimant peasants have found a new fraud to perpetrate. They have started driving their uninsured vehicles into the houses of friends who are then making claims on their buildings and contents insurance to have their houses refurbished and fitted with Surround Sound, 3D TV’s, new I-Pads, leather suites and so on and so you see those insurance premiums are now increasing and thus there are no savings, as yet, to pass onto the general peasants - I’m sorry- I mean policy holders..”

King: "I’ve heard enough. Guards have him removed. Chief Insurer I sentence you to be hanged from the RTA Portal. Take him away.”

Guards take away the Chief Insurer who is heard shouting, “but what about my severance pay” as he is dragged off down the corridor.

King:  “Courtier, fetch me the leader of the renegade claimant peasants. I think he and I need to talk...”

Heads, Sand, Ostriches and all that....

                                                                         

A short article by John Hyde in the Law Society Gazette last week Prepare for 50% fee cuts, Says 'end of lawyers' professor produced the expected wide range of opinion on the predictions of Professor Robert Susskind. In the article Hyde outlines how Susskind, in an address to the Law Society Management Conference, warned that the economic climate will force clients to seek out firms that embrace the technological advances available in the legal profession  to enable them to reduce their legal costs. Susskind argued that bosses of both small and large companies will seek to reduce their legal spend by 50% over the next five years, as they look for ways of gaining 'more for less' through new pricing structures. Susskind went on to argue that there would be casualties amongst smaller firms and sole practitioners unless they are prepared to embrace new technologies, but for those prepared to embrace the new models, opportunities abound.

So no surprise that the first three comments added by readers in the comments section at the end of the article, covered all bases of opinion about Susskind's predictions. One said he was wrong, one said he was right and one said that some predictions would come true whilst others would not!

There were though other contributors whose comments really struck a chord.  One contributor suggested that whilst lawyers are very quick to pick up on new principles, they tended to want to use them straight away and where non technical skills were concerned, they were unlikely to be put into practice unless there was a real mindset that the firm was committed to change. Another suggested that those that really needed to adopt Susskind's suggestions probably would not until it was too late hoping perhaps that if they were of a certain age, they could get through to retirement without having to change their working practices.

In the area that I practised in throughout my career (claimant PI derived mainly from RTA) huge swathes of changes are about to land upon the profession. Yet I see a great deal of ostrich like behaviour - whole banks of paralegals covering several or more office floors, secretarial staff scurrying around all over the place, a limited use of technology ('we've got a website and PC's - what more do we need?') and partners uttering; 'Don't panic Captain Mainwaring' to anyone who dares question; 'What will happen come April 2013?'

I am sure that I do many firms a disservice, but similarly across a wider spectrum of firms other than the RTA/PI brigade, there seems to be the mentality that 'everything will be all right', that the solicitor is still, along with the mayor, the accountant, the doctor, and the bank manager (where are THEY now?), the respected pillar of every towns community and therefore for that reason the work will still flow and the public and business community will still pay THOSE fees.

I find myself with the good professor on this one. Fixed fee structures will become increasingly attractive and even the norm. Firms like the hugely innovative Riverview Law, based on the Wirral, are leading the way. Technology is available to help all firms achieve the aim of lowering fees - for small to medium firms as well as the big boys and girls. Putting together a carefully structured plan to introduce the right technology and the accompanying cost of the initial outlay, should not put off implementing what are likely to prove life saving changes.

I am similarly dismayed by how relatively few firms have a credible online presence or use social media as a major part of their marketing strategy. For smaller firms in particular this is a low cost means of getting themselves out to the public. Perhaps it is because many of them see Social Media as nothing but a talking shop for teenagers or a place for celebrities to stroke their egos - certainly not a place for any respectable member of the legal profession to be seen. Wake up people. I was recently back in my home town in the north for the funeral of my aunt and got into discussion with my cousin, whom I had not seen for many years. He has been a self employed electrician for many years and when I asked him how business was, he told me that it was steady, but that whilst he got a good deal of repeat business from the older generation, new business from the younger generation was pretty much non existent. When I went on to ask him if he had an online presence; website, Social Media etc, he confirmed what I had thought - that he hadn't. Nothing at all.

My work involves many hours of trawling through cyberspace looking at solicitors websites or in many cases seeking them out without success. Some that do have them, well, might as well have not bothered. There are some truly awful ones out there - in many cases, they probably would be better off not bothering at all.  As for Social Media or blogging - erm, what's that?

There are those too, who know in their heart of hearts that Social Media is the way forward. So they set up Facebook and Twitter pages and even a blog too. They make a couple of posts and then... nothing. The surge of enthusiasm that led them to set everything up, wanes as the realisation dawns that this is something that needs to be worked on on a regular basis. Other, 'more important' matters take over and hence there are endless pages on Twitter or Facebook that have not been used since 2010. What was that that Susskind said about countering the mindset that 'we think we can take on a new discipline over a weekend'?

I know only too well that running a small or medium sized practice is more than a full time occupation. Getting a meaningful days work done amongst all the other distractions can be difficult enough without thinking about marketing the practice or looking at ways that technology can help on an administrative level. I also know from experience, that for partners and  senior members of staff, delegating to others within the firm can  be a huge psychological barrier to overcome, let alone delegating to an outside agency. There is though help at hand. I am not the only former practitioner who now plies his trade in assisting firms in marketing or advising on the new technology available on an administrative level. There are those of us, who have been in those shoes, but who have now got the advantage of having that huge weight of running a legal practice removed from their shoulders and from whom the dark glasses have been removed..and as the advert says 'The future is bright, the future is....' but only to those who make up their minds that it will be and do something about it!

View From The Claimant Camp - Is There Anyone At Home?

                                                                            

I have to confess that I have developed the habit in recent times, upon waking and after making the life-saving cup of tea, of switching the laptop on and diving straight into Social Media. The other day I went straight to one of my favourite sites, the excellent ‘Legal Futures’ and there it was – an article with the headline ‘Government confirms U-turn on raising small claims limit for PI claims.’ My immediate thought was, ‘where is Maggie when U-turns are being talked about by a Tory government?’

My disposition quickly turned to anger. Just a few months ago the government said that the personal injury small-claims limit would remain at £1000. That was following the ‘Solving dispute in county courts’ consultation – consultation, that’s right. So what has changed in a few short months for the government to perform a U-turn?

Furthermore the article went on to state, that in the summer, the government ’will consult on this (increasing the limit) and on the feasibility of introducing independent medical panels to replace the current assessment of whiplash injuries either by GP’s or by doctors employed by medical reporting organisations’. The Moj’s  statement justifying  this, included the now well worn chestnut of ‘transparent and consistent approach to assessment and easier identification of exaggerated or fraudulent injuries.” Ah yes, “fraudulent claims/injuries”, “exaggerated” – add to that your own list - here are a few more to help you : “compensation culture”, “blame culture” “whiplash claims” (meaning any injury that has a compensatory value of less than £5000), “genuine victims”, “No Win – No Fee” (this has to be said in a certain manner to get the full effect ie the words have to be spat out). You get my drift – sound bites.

The government spokesman went on to provide further justification for these proposed measures;

“This is part of a package of reforms, including reforms ‘no win, no fee (spit)’ and referral fees. This will reduce costs for insurers (ah, right) – savings which we strongly encourage (note the use of very gentle word – ‘encourage’) them to pass onto consumers through cheaper premiums (breath not being held.)’

To his credit Law Society President Wotton did weigh in with the following;

“Fraud is entirely indefensible and the Law Society has made it clear time and again that it is happy to work with ministers and the insurance industry on tackling fraud head on – but we must ensure that proper recourse to justice remains available for those who have been injured by the negligence of  others. We doubt that simply giving insurers what they are asking for will reduce premiums.”

So there we have it. Referral fees and ATE are to go. The reducing of the fixed fee that solicitors can claim when they deal with claims under the portal is already underway and leaked emails tell us that the insurers likely starting point will be £150.00 – consultation with the claimant lobby will take place. So £150.00 is what it will be then gov?

Look, I have been involved in this “industry “(hate the term) since the early 1980’s. I worked for and then with, the pioneering Manchester solicitor, the sadly now deceased Keith Beardsell. I worked in his small office when regular visitors would be Chris Norman and David Garner, at that time computer  salesman (of ‘tardis’ sized computers)   and Accountant respectively. The former founded what became 3 Arrows Car Hire, the latter Forward Hire, MSL and now Financial & Legal. I saw the birth of credit hire and RTA claims, as entities in their own right. No the insurers didn’t like them. To claimants’, credit hire, credit repair and efficient solicitors were great services – to the insurers an unwelcome expense. 

                              

                                                                             

In the early to mid 1990’s I was involved at the “coal face” when the insurers and their advisers turned to the medieval concept of ‘Champerty & Maintenance’ to try and persuade the judiciary that credit hire agreements were invalid in law. I was at the House of Lords, when it ruled in the test cases before them, that such agreements were valid. Bloody nose for the insurers no 1.

I had my own practice by the time that the next real test went to the higher courts and the Consumer Credit Act cases of Dimond v Lovell et al were heard. Bloody nose for the insurers no. 2.

Throughout this period and indeed up until the present day, there have been steady streams of precedent cases on “rate of hire” and “length of hire.” That is entirely healthy – some have gone for claimants, some for the insurers.

However, overall throughout the last 25 plus years the claimant “industry” has survived the legal challenges to it. Perhaps that is because it has by and large been conducted along decent, legal lines and also because it provides a very good service to genuine claimants.

To my mind, this is the crux of where we are today. The insurers have failed to defeat what they see as an insidious “industry” per se, by using the courts of the land. So their tack now?  – political lobbying. Hit the governments of the day – of whatever political persuasion – right in the solar plexus – mention ‘vote winning’.

First of all though there had to be a period of building up the right atmosphere. So there was much talk using the sound bites mentioned before “compensation culture” “fraudulent claims” “whiplash injuries”, “NoWin, No Fee (I will have to clean the study floor of all this spittle) and of course “reducing insurance premiums”. We all want lower insurance premiums, particularly those of us with children of a certain age who are desperate to get their independence from “Mum and Dad’s taxi” (I wouldn’t mind some independence for Dad either) .

Then attack – and boy haven’t they done well these insurance boys (and girls). So, it seems we are now at the stage where it’s almost mission complete and the insurers have got their way. I’m not suggesting that they have done anything wrong either morally or legally and of course the claimant camp has a voice but either it has been ignored, or as I suspect, it has not made itself heard loudly or effectively enough. I wonder where all those fighters from the 90’s have disappeared to? Probably grown into middle age and beyond as I have (I will own up to the former, not yet the latter). Possibly in their place have come those who have become complacent and if they have woken up to what is happening, they have done so too late. So like the Wolverhampton Wanderers defence have done this season, they have stood dozing on the half way line whilst the opposition has scored goals at will.

Nor am I saying that there is no need for reform. I have never liked referral fees. As a solicitor with my own practice, starting up in 1994, I built my business up  by marketing very actively – getting my hands dirty by going out to see insurance, brokers, garages, legal expense insurers and gradually growing by providing a good, honest and efficient service and gaining a decent reputation. I resisted referral fees for as long as I possibly could, but when they became permitted in the late 90’s I had to give in eventually. I recall spending what for a small practice was a not inconsiderable sum on doing some cable TV advertising (hands up who remembers cable TV?). Our advert used to go out between the topless darts and the weather girl – or was it the topless weather girl and the darts? No wonder we got some strange enquiries! I recall at the time speaking to a good friend who acted as a mentor to me , and who was the Senior Partner of a large, successful RTA practice in the north. He asked me how much I had paid for the advertising and when I told him, he said to me that for that amount, he could buy around three hundred guaranteed fee bearing case leads. I had to take that on board and accept defeat. Ultimately the bulk of referral fees end up in the pockets of the insurance brokers, garages and recovery agents (not to mention LEI’s). They do not, in my experience though, add any cost whatsoever to the claim in so far as the paying insurer is concerned. They are swallowed up as a necessary evil by the claimants solicitor.

Like everyone else, I abhor fraudulent claims. I am aware that unfortunately the practice of sham accidents and false claimants has risen over the past 10 years. I had a few scenarios when in practice where I or my fee earners suspected dodgy dealings were afoot and we got shot of them and reported them very quickly. Even as recently as the past couple of months ago,  I came across an outfit advertising for PI’s to be referred to them for a payment of many hundreds of pounds on a social media site. I played along by making some enquiries of them, but when I broached the question of seeing their MoJ authorised business number, they quickly went silent on me. I reported them via the Claims Regulation website and asked to be kept informed – however that was about 4 weeks ago, and I have not heard a word from the authority. I’m not aware if the outfit in question were involved in fraudulent claims, but as far as I could see they were not authorised to carry out claims management services as they ought to be. I simply did what the vast majority of those in the claimant camp would do, and reported them.

It just frustrates and indeed angers me that by using soundbites, vote winning words and slogans, as the government and insurers do, all claimant solicitors, all claimants, all of the smaller injuries suffered by those claimants, all AMC’s, all credit hire companies and so on, are tarred with the same very unfair brush.

Neither do we hear a great deal about the inefficiencies and at times ( I am being kind using the words ‘at times’) incompetence of insurers, in the way they approach the handling of claims. A whole book could be written on my experiences of dealing with insurers, and the quality of staff that they have historically employed, but suffice it to say that were as much attention and time poured into them sharpening up their own act, as has been put into their cosying up to the governments of recent times, considerable savings could already have been made on insurance premiums.

Anyway, in 18 months time, please folks tell the world how much your insurance premiums have come down, once those nasty claimants and their even nastier advisors have been trampled underfoot. Or will it be the case that the insurers will have to find new scapegoats as to the reasons why surprise, surprise, they haven’t really come down at all?