Richard Whitehall successful in appeal relating to a case concerning a high value personal injury claim brought in the RTA Claims Portal
In a sequel to the well-known decision in Lyle v Allianz (HHJ Pearce, 21 December 2017), HHJ Wood QC has dismissed an appeal against a decision of District Judge Campbell in the Birkenhead County Court striking out a claim pleaded at £2.2 million. A copy of his judgment can be found here.
The Claimant was injured in an accident in September 2014. His solicitors presented his personal injury claim through the RTA claims portal and the Defendant’s insurers promptly admitted liability. In July 2017, they issued a Part 8 claim form under CPR PD 8B para. 16 and sought a stay of the action, pending completion of the process under the RTA Protocol. The court made an order on paper staying the action for a year and requiring the Claimant to serve the Part 8 proceedings on the Defendant within 21 days. They did not in fact do this until February 2018, some 6 months later. Shortly before the expiry of the stay in August 2018, the Claimant applied for the stay to be lifted and for the case to be transferred to the Part 7 procedure, on the grounds that it was no longer suitable for the RTA Protocol process. The court made that order on paper and required the Claimant to serve amended proceedings within 14 days. Amended proceedings were in fact served 22 days late. Meanwhile, in September 2018, the Claimant’s solicitors served 2 medical reports from a Consultant Neurologist which concluded that the Claimant had developed a serious and debilitating neurological disorder as a consequence of the accident and a Schedule of Loss pleaded at over £2.2 million.
The Defendant applied to set aside the order transferring the case to Part 7 and sought a strike-out of the action on the same grounds as HHJ Pearce had considered in Lyle. The Claimant’s solicitors cross-applied for relief from sanctions in respect of the late service of the amended proceedings. DJ Campbell allowed the Defendant’s application and struck out the claim. She also decided that had she been willing to refuse the Defendant’s application, she would not have granted relief from sanctions in any event.
DJ Campbell’s reasons for striking out the claim can be summarised as follows:
- the case ought to have been recognised as a claim with a value in excess of the RTA Protocol limit long before the Part 8 action was issued, when the Claimant’s solicitors received the medical evidence of their neurologist. The District Judge said “I have never had an application before me where it is so obvious on the evidence that this was never a portal case”.
- the Defendant did not know that proceedings had been issued until February 2018 and had no reason to believe that the claim was worth more than the RTA Protocol limit until September 2018, when they received the medical evidence and the schedule.
- the Defendant was prejudiced in that:
- the use of the PD 8B Para. 16 procedure to bring a claim which ought to have been recognised as a high-value claim was an abuse of process.
- they were kept in the dark as to the true value of the claim;
- they were unable to set a reserve;
- they were deprived of the benefits of the PI Protocol (including in the selection of experts, the disclosure of medical evidence, the service of a schedule etc.);
- they were unable to offer rehabilitation;
- the Claimant had effectively added a year to the limitation period (by obtaining a stay); and
- there was a delay in the case management of the action.
The District Judge decided to set aside the previous order. She then decided to refuse to exercise her discretion in favour of lifting the stay, and on the basis that the action could not remain permanently stayed, struck it out. The judge was concerned that the sanction of a strike-out would result in very serious consequences for the Claimant, but having “wracked her brains” for a reasonable alternative, decided that the only option was to strike out the claim. She went on to decide that the application for relief from sanctions should also fail, largely for the same reasons.
HHJ Wood QC heard the appeal on the 5th July 2019 and handed down judgment on the 9th August. He upheld the District Judge’s decision for the following reasons:
- he confirmed that the court has a power to strike out an action which remained subject to a stay, so that if the judge’s decision to refuse to lift the stay was not wrong, the option of striking out the claim was open to her;
- the judge was entitled to consider whether use of the PD 8B para. 16 procedure was an abuse of process as one factor amongst several when considering the exercise of her discretion in respect of the Claimant’s application to lift stay and transfer the claim to Part 7;
- it was reasonable for the District Judge to conclude that the Claimant’s solicitors’ conduct had secured an advantage for the Claimant and had disadvantaged the Defendant;
- a finding as to the reason for the Claimant’s solicitors’ conduct – i.e. whether it was deliberate or not – was not a pre-requisite to finding that there had been an abuse of process;
- the judge was correct to be highly critical of the Claimant’s solicitors, especially in light of the duties imposed by the Personal Injury Protocol;
- the District Judge was right to weigh up the cumulative effect of the various ways in which the Defendant had been prejudiced by the Claimant’s conduct;
- the judge gave due weight to the prejudice to the Claimant arising from a strike-out of his claim;
- the judge’s decision was an exercise of her discretion which could not be said to have been wrong;
- HHJ Wood QC added: “In fact, it is difficult to contemplate any other outcome in the circumstances with which she was faced. I agree entirely with the conclusion that the Claimant’s solicitors’ conduct was more significant and serious than that which was considered by HHJ Pearce in the Lyle case”.
The dismissal of the appeal in respect of the strike-out disposed of the appeal, but HHJ Wood QC went on to consider the secondary appeal relating to the District Judge’s refusal to grant relief from sanctions. In this regard the judge considered that the judge was wrong, on the basis that if the prior finding was that the Claimant’s solicitors’ conduct was not so bad as to justify a strike-out, it must follow that in all the circumstances of the case, relief from the sanction arising from the Claimant’s failure to serve the amended proceedings ought to have been granted.
This judgment, taken together with Lyle v Allianz, makes clear that Claimant’s solicitors should take care not to use the RTA or EL/PL Protocols to pursue claims with a value in excess of the Protocol limit, and if it becomes clear that the claim does have a value in excess of the limit, the Claimant’s solicitor should take prompt steps to bring the claim into the standard PI Protocol/Part 7 procedure.
Further, there must now be a strong case for an amendment to the rules and PD 8B to make clear the obligations on Claimants in these circumstances.
Richard Whitehall was instructed by Charlotte Smith at Keoghs LLP.