Академический Документы
Профессиональный Документы
Культура Документы
Contents
News 1
General damages to increase by 10% Third UK Corporate Manslaughter conviction obtained Victims unable to claim from taxi driving rapists motor insurers Government announces new compensation scheme for Mesothelioma victims Pyrite panel publishes report for Irish Government 1
Fraud 6
Insurance Fraud Enforcement Department secures first conviction: R v John Machin Leeds Crown Court (2012)
Quantum 7
First Jury Loss of Society Awards since reforms: Kelly v UCS Court of Session (2012)
Disclaimer 8
Comment: The Jackson reforms are intended to reduce the costs of litigation by ending the recoverability of success fees and after the event insurance premiums from defendants. The increase in general damages was intended to partly offset these losses to claimants but because of the retrospective nature of the Court of Appeals judgment, insurers and other compensators will see demands for increased damages now without the benefits of costs reform yet taking effect.
in the sum of 84,000. The prosecution costs were halved by the Judge due to the unacceptably long delay in prosecuting the case, some four years after the tragic death of employee Steven Berry who fell from a roof. The fine was reduced from 600,000 to 480,000 to reflect the guilty plea. The gross fine at 600,000 was the first to comply with the sentencing guidelines which recommend fines above 500,000 in value. Following submissions about the impact of a large fine on a relatively small company, Lion Steel was given three years to pay the fine and costs.
Comment: Following this third prosecution, questions remain about how the court will define senior management in large companies and whether the prosecuting authorities have the appetite to prosecute a large organisation.
Mr Justice Silber expressed his great sympathy for the claimants but said that his duty in deciding the case was to follow the appropriate legal principles. Comment: Interpretation of whether injuries fall within the RTA will always be governed by the particular facts of the case. The essential character of the journey at the time of the incident that led to injury was the key consideration in the judgment here. We are grateful to DAC Beachcroft who acted for the insurers Inceptum in this case, for their very helpful note on the outcome.
Inceptum as insurers of Worboys taxi were not liable under the Act to meet any judgment obtained by the claimant against Worboys. In reaching his decision the Judge found that the term arising out of must be applied to the relationship between the injuries suffered and the use of the vehicle at the time they were suffered (not at the outset of the journey). The link between the use of the vehicle and the injuries was broken by Worboys acts of drugging and raping his victims. This case was distinguished from the Court of Appeal authority of Dunthorne v Bentley. In Dunthorne a motorist caused an accident by running across a road to find petrol for her car. In that case, the injuries to another driver were held to have arisen from the use of a motor vehicle. The motorist in Dunthorne was seeking fuel so that she could continue her duty whereas Worboys had no wish to continue a journey he planned solely to commit rape.
To fund the scheme the Government is to introduce a tax on current Employers Liability (EL) Gross Written Premium (GWP) with effect from 2014 (a contribution based on historic market share was considered to be too difficult to administer). The rate will not be announced until the 2013 budget and will be implemented by the Finance Bill 2013. To cover set up costs and the initial backlog of old cases, insurers will have to have to pay a levy of around 3% (possibly more) of 2013 GWP based on Employers Liability Tracing Office (ELTO) disclosure figures with the DWP contributing a 50 million loan to the MUTS administration body. No commencement date has yet been set but the second quarter of 2014 is likely. The compensation tariff will run at 75% of 2008 awards plus an adjustment for inflation.
Comment: The scheme will provide much needed compensation for Mesothelioma victims and their families, who would otherwise be unable to claim damages. It stops short of a universal scheme (like the Motor Insurers Bureau untraced and uninsured schemes) as was originally proposed but this could be extended in the future.
The immediate problem identified by the panel is to find funds for the many uninsured homeowners, to affect repairs. The panel believe that funds should be made available by the construction/ quarrying industry and their insurers. The former could be subject to a Government imposed levy. Homebond are urged to reconsider their position and re-engage with homeowners as soon as possible. In addition, there should be a review of the standard limits of Contractors All-Risk and Public Liability policies, a review of the Statute of Limitations in respect of latent
defects and the removal of restrictions of cover in relation to pyrite-affected dwellings. Comment: the Pyrite Panel has no powers to amend Irish legislation but has called on the Irish Government to act quickly to assist homeowners. The extent of any impact on the construction industry and their insurers will depend on what if any panel recommendations the Irish Government adopt. Many insurers currently exclude cover for pyrite damage.
Fraud Insurance Fraud Enforcement Department secures first conviction: R v John Machin Leeds Crown Court (2012)
Would be insurance fraudster John Machin has become the first person to be convicted following an Insurance Fraud Enforcement Department (IFED) investigation. Mr Machin inadvertently incriminated himself when he failed to hang up his telephone properly after ringing his insurers to report a fictitious accident and was recorded boasting to an accomplice about how easy it was to make a fraudulent claim. The insurers reported him to IFED, the specialist police unit funded by insurers to tackle insurance fraud. Mr Machin was subsequently prosecuted and sentenced to a suspended prison sentence of one
year. He was also ordered to complete 200 hours of community service. Machin has had to suffer the embarrassment of having his recorded comments played on BBC Radio 4s You and Yours programme, aired on the BBCs web site and later reported by international news agencies as far afield as Atlanta. Comment: It is always pleasing to see a fraudster get his just desserts, especially in such a public way.
Quantum First Jury Loss of Society Awards since reforms: Kelly v UCS Court of Session (2012)
The first jury trial for Loss of Society claims, following the reform of the system by the Inner House of the Court of Session in the combined appeal cases of Hamilton and Anr v Ferguson Transport and Thomson v Dennis Thomson Ltd (see July 2012 Brief) has seen the jury awarding damages within the range given them by the judge. In the case of Kelly v UCS the judge gave the following guideline figures for loss of society suffered by the family of a deceased mesothelioma victim: Widow Adult Child Grandchild Sibling 40,000 to 80,000 15,000 to 35,000 5,000 to 25,000 5,000 to 20,000 Comment: In the first case where a jury was allowed to have guidance, they kept to the recommended brackets and made awards at the lower end. If this is repeated in subsequent cases, the spiralling increases in the level of awards will end (although damages will remain far higher than in England and Wales). Once again, we are grateful to HBM Sayers who acted for the Defenders in the Inner House appeal cases, for their helpful note on this case.
The jury having considered this advice made the following awards: Widow Adult Child Adult Grandchild Brother 40,000 25,000 8,000 8,000
Completed 30 July 2012 written by and copy judgments and/or source material for the above available from John Tutton (contact no: 01245 272 756, e-mail: john.tutton@uk.qbe.com).
Disclaimer
This publication has been produced by QBE Insurance (Europe) Ltd (QIEL). QIEL is a company member of the QBE Insurance Group. Readership of this publication does not create an insurer-client, or other business or legal relationship. This publication provides information about the law to help you to understand and manage risk within your organisation. Legal information is not the same as legal advice. This publication does not purport to provide a definitive statement of the law and is not intended to replace, nor may it be relied upon as a substitute for, specific legal or other professional advice. QIEL has acted in good faith to provide an accurate publication. However, QIEL and the QBE Group do not make any warranties or representations of any kind about the contents of this publication, the accuracy or timeliness of its contents, or the information or explanations given. QIEL and the QBE Group do not have any duty to you, whether in contract, tort, under statute or otherwise with respect to or in connection with this publication or the information contained within it. QIEL and the QBE Group have no obligation to update this report or any information contained within it.
To the fullest extent permitted by law, QIEL and the QBE Group disclaim any responsibility or liability for any loss or damage suffered or cost incurred by you or by any other person arising out of or in connection with you or any other persons reliance on this publication or on the information contained within it and for any omissions or inaccuracies. QBE Insurance (Europe) Limited and QBE Underwriting Limited are authorised and regulated by the Financial Services Authority. QBE Management Services (UK) Limited and QBE Underwriting Services (UK) Limited are both Appointed Representatives of QBE Insurance (Europe) Limited and QBE Underwriting Limited.
3927/technicalclaimsbrief/august2012 QBE European Operations is a trading name of QBE Insurance (Europe) Limited and QBE Underwriting Limited. QBE Insurance (Europe) Limited and QBE Underwriting Limited are authorised and regulated by the Financial Services Authority. QBE Management Services (UK) Limited and QBE Underwriting Services (UK) Limited are both Appointed Representatives of QBE Insurance (Europe) Limited and QBE Underwriting Limited.