Contrast and compare

Berrymans Lace Mawer LLP head of policy development Alistair Kinley looks at two recent personal injury compensation disputes which used judicial proceedings to challenge the substance of law in the following article published in this week's edition of Post Magazine.

Damages & asbestos: Contrast and compare

Earlier this month there were developments on two seemingly unconnected matters relating to personal injury compensation in different parts of the UK.

The new edition of the Ogden Tables - used in serious personal injury and fatal accident claims - was published and, days later, the Supreme Court ruled that Scottish legislation concerning compensation for asbestos-related conditions should be upheld.

However, these two very different developments both have the use of judicial review proceedings with regard to the substance of the law at their core.

In the foreword to the new edition of the Ogden Tables, the Lord Chancellor has agreed to review the discount rate applying to these claims. What it does not mention is that the prospect of the review of the rate was raised in proceedings for judicial review brought against the Lord Chancellor by the Association of Personal Injury Lawyers.

Challenged by insurers

In contrast, the Scottish legislation - The Damages (Asbestos-related Conditions) (Scotland) Act 2009 - was expressly challenged by insurers in proceedings for judicial review which ended up before the Supreme Court.

What can be seen in both instances is the use of the largely procedural judicial review challenge by key stakeholder groups in order to further their arguments as to what the substance of the law should be.

With the Ogden Tables, it could be said that Apil argued that the procedural defect was a failure to openly to review the discount rate since 2001. The substantive argument that follows behind this would appear to be that, in Apil's view, a review should be undertaken and the rate could change.

Meanwhile, with the Scottish review, insurers sought to challenge the basis of the 2009 legislation restoring compensation in Scotland for pleural plaques and other asymptomatic asbestos-related conditions. The substantive argument behind it would appear to be that, in the insurers' view, if the legislation was defective then compensation for these conditions would not or could not apply.

In neither example was the challenge by way of judicial review actually successful. Does this matter or are there other consequences to consider?

The action in respect of the discount rate was dismissed by Mr Justice Holman in August 2011 who said that he "can see absolutely no prospect of the present JR succeeding".

More recently in the Supreme Court with regards to the 2009 Act, Lord Reed held that: "the Scottish Parliament considered it appropriate, as a matter of social policy, to legislate to reverse the Rothwell decision, so as to ensure that compensation continued to be paid to persons in that position. It cannot be said by a court that the parliament's judgment that that was in the public interest was manifestly unreasonable."

However, the fact that both actions were unsuccessful does not necessarily mean that these judicial review proceedings are without interest, both in theory and in practice. In the first case, the challenge to the failure to review the discount rate has yielded some valuable and interesting information within Judge Holman's order, despite him dismissing the claim.

He observed that: "Now the Lord Chancellor says… that he will publish a public consultation document in late September or October 2011… If, in breach of what he has clearly said, the Lord Chancellor now fails to carry out the public consultation which he has clearly said he had decided to carry out; or fails to do so more or less to the timetable set out [above] then there might be grounds for a fresh claim for judicial review."

Consultation process

The practical impact of the judicial review, therefore, is that a wide consultation on the discount rate is expected fairly shortly. Such a consultation process is likely to provide all stakeholders with the opportunity to make representations to the Lord Chancellor about what they think the rate should be and how it should be set.

Consequently, despite losing the judicial review in quite narrow terms, it could reasonably be argued that Apil may have succeeded on a broader point; securing the opportunity to press its views on the discount rate to the Lord Chancellor.

But what are the immediate conclusions that might be drawn from the Supreme Court's recent dismissal of the insurers' challenge to the Scottish asbestos legislation?

What emerges is that the underlying constitutional point is of fundamental importance. What is also clear is a strong commitment by insurers to test the point in the very highest forum.

Lord Reed said: "But the question as to whether Acts of the Scottish Parliament and measures passed under devolved powers by the legislatures in Wales and Northern Ireland are amenable to judicial review, and if so on what grounds, is a matter of very great constitutional importance. It goes to the root of the relationship between the democratically elected legislatures and the judiciary."

This was the first time, in the personal injury field at least, that the question appears to have been asked. Even if the Supreme Court dismissed this particular challenge further similar activity might be expected, particularly if the devolved administrations within the UK enact further statutory and regulatory measures relating to compensation for personal injury.

Other areas of reform have also seen challenges by way of judicial review. For example, it is understood that certain charities and interest groups have sought to challenge by way of judicial review the Ministry of Justice's approach to enacting Lord Justice Jackson's recommendations about controlling the costs of civil litigation.

In another example, the Law Society succeeded in judicial review proceedings ?challenging proposed changes to the basis of legal aid contracts.

Raising broader issues

The question arising for the future is whether the use of judicial review proceedings will become more commonplace in the formulation of policy relating to negligence, personal injury compensation and costs?

There are a number of reasons why this may prove to be the case. First, the cases detailed above show it can serve to raise broader issues even if the challenge on the narrow points is unsuccessful.

It also appears likely that devolved administrations will continue to make provisions relating to compensation issues, which could raise questions of constitutional competence and other challenges.

In addition, the changes in England and Wales envisaged by the Jackson review and the removal of legal aid are of huge significance in civil litigation, which may of itself draw out challenges of this nature from the stakeholders who perceive themselves to be most acutely affected.

The essence of a challenge by way of judicial review is an attack on the process by which a decision has been reached. Its aim is to identify a defect in the decision-making process sufficient to cause the decision to be annulled and the process that led up to it to be undertaken again - meaning the debate can be prolonged.

Given the sheer range of measures and proposals already in train in relation to compensation and costs issues, and given the fairly recent judicial review claims on high profile reforms, the realistic conclusion must be that the additional option offered by such proceedings will remain a very real tool that major stakeholders will continue to deploy when engaging with policymakers on key areas of reform.

Alistair Kinley is head of policy development at national law firm Berrymans Lace Mawer LLP

This article is not a substitute for specific legal advice and should not be relied upon as such.