Over the years we have seen many claimants pursuing compensation without the relevant legal representation. This is a process which on paper seems relatively simple but in practice can be extremely complicated, even with “open and shut” cases. In the words of a famous song, you have got to “know when to hold ‘em, know when to fold ‘em, know when to walk away and know when to run”. It is perhaps stretching it a little to describe personal injury claim settlement negotiations as a game of poker but it is certainly a testing time for all parties.
Appointing A Personal Injury Solicitor
The very fact that personal injury solicitors will not take on a case unless they believe the claim will be successful. they tend to deal in cases weighed in their favour to avoid excess costs and give themselves more than a fighting chance of getting their clients the settlement they deserve.
Once a personal injury solicitor has agreed to take on your case the first thing to do, after reviewing the evidence, is to calculate a theoretical compensation settlement figure. This will be included in the documentation if your case goes to court but, like everything in the legal world, is open to negotiation. There are a number of ways to calculate a potential claim such as:
- Judicial College guidelines
While the judicial College guidelines are not commonly circulated in the public domain they do offer useful guidance on the level of compensation for specific types of injury. They have no legal standing but they are used to calculate compensation. The guidelines are updated every few years to reflect the growing costs of medical care, cost of living and developments in medicine. However, the variation in potential compensation for individual injuries can be significant.
- Expert opinion
There will be occasions where your personal injury solicitor will require additional outside opinion as to the full extent of your injuries and potential compensation. These additional costs are traditionally covered by No Win No Fee arrangements where a percentage of any compensation will be transferred to the personal injury solicitor for their fees. A personal injury solicitor would only seek expert opinion where the cost of such advice was but a fraction of the potential increase in compensation.
- Know your market
The vast majority of established personal injury claim companies will be able to draw upon significant experience of years gone by. This “know-how” can prove priceless when comparing and contrasting settlement offers against the perceived true level. When you consider that both parties will be trying to maximise/minimise their client’s exposure, there will be a fight for every pound. There will be some cases which are relatively straightforward while others may be more complicated and lengthy, commonly medical negligence cases.
Keep A Clear Head When An Offer Is Made
If you have a relatively strong case for compensation it is sometimes useful to put yourself in the shoes of those representing the defendant. They will have access to the same evidence as your representatives and likely come to the same conclusion. So, if it seems fairly obvious that liability has been proven then it is simply a case of the defendant’s representatives attempting to mitigate the level of compensation and legal costs going forward. There are a number of ways this can be achieved such as:-
- Pre-medical examination offers
The idea that the defendant may make an offer for compensation prior to a medical examination may seem bizarre to some people. When you consider that the UK government is currently looking at banning “pre-med” offers it is probably worth digging a little deeper on this matter. By offering a relatively low amount of compensation before a medical examination has been undertaken this may result in a speedy settlement. The claimant may want to draw the matter to a close, believe that the relatively small offer is reasonable and the defendant would look to close down the situation and limit any further liability.
There is one reason why the UK government is looking to ban pre-med offers which is quite simple, without a medical examination the full extent of the claimant’s injuries cannot be confirmed. What may appear as fairly innocuous injuries at the outset could have long-term ramifications and lead to serious medical conditions. There are very few occasions where it is in the best interests of the claimant to accept a pre-med offer. If one is made, you should take the advice of your personal injury solicitor.
- Admitting liability and presenting an offer
There will be situations where the defendant has admitted liability and it is simply a case of negotiating the best offer. In many cases the defendant will make a relatively paltry offer as soon as medical evidence has been received and liability admitted. This can be seen as a means of bringing the issue to a speedy close while sometimes not giving the claimant time to think things through. You may see an array of different strategies such as strict deadlines and an initial refusal to negotiate. Again, this is where your solicitor will be able to use their experience and calculate a fair theoretical compensation award and compare with the offer on the table.
We have also seen issues where loss of income and medical expenses can put pressure on the claimant’s finances. Even if they have a relatively strong case for compensation, and sometimes liability can be admitted early on, the longer the case goes on the more costs they may have to cover. What some may see as underhand, but is actually a legitimate legal strategy, is to offer a discounted compensation package to help the claimant alleviate their financial woes. However, this strategy could cost the claimant a significant amount of money.
In this scenario your representative may look towards what is known as an interim payment. This means that the defendant’s insurance company will make an interim payment, to be offset against the final settlement, to reduce the claimant’s short term financial woes.
Negotiation, Negotiation, And More Negotiation
We know that the vast majority of compensation claims never reach the courtroom. The reasons many cases never make it to court include:-
- Minimising legal fees going forward
- Admission of liability
- Bringing a pressure situation to an acceptable end for all parties
- Realisation that liability cannot be proved
While some of the legal strategies used to try and mitigate compensation awards for defendants and maximise them for claimants may seem underhand, they are perfectly ethical. Ultimately it is down to the defendant and the claimant to rubber-stamp a theoretical agreement but they should take the advice of their solicitor, otherwise why appoint them?
Situations Where Early Settlement Might Be Avoided
We regularly come across situations where the defendant has admitted liability and is keen to come to a settlement as soon as possible. Remember, even if the defendant has admitted liability there is no obligation for you to accept an out-of-court settlement. There will be situations where it makes sense to do this but if there is any doubt about the consequence of your injuries in the longer term, then a court case may be the best course of action.
There is no rush to agree a compensation payment if:-
- You have not made a full recovery from your injuries
- The doctors have estimated recovery will be more than six months after your examination
- You experienced multiple injuries that require the attention of multiple specialists
- Treatment for your injuries/condition is still ongoing
- There is no definitive answer regarding your recovery time
In simple terms, where there is potential for further medical complications (or even mental health issues) in the future it may be wise not to agree any compensation package right away. Again, this is where your personal injury solicitor will come into play as they will have experience in this area.
Interim Payments
As mentioned earlier in this article, we regularly see situations where the defendant has admitted liability and compensation negotiations are ongoing. A side-effect of these ongoing negotiations, which can drag on for years, is financial pressure on the claimant. Where a claimant does not have the protection of a personal injury solicitor and has decided to “go alone” there might be a temptation to settle early for a low figure. However, there is a system whereby once liability has been accepted the claimant can apply for an interim payment which would cover medical costs and loss of income in the short term.
While any interim payment would be deducted from the final settlement, it cannot only reduce financial pressure but also mental stress. Ask yourself this question, why should you as the claimant suffer when the defendant has admitted liability and a compensation payment is coming your way?
Part 36 Offers
Unless you are involved in the legal profession it is unlikely that you have come across what are known as “Part 36 offers”. Under civil liability laws a defendant can make an offer of compensation prior to a court hearing. In many ways this is a tactical move because it places the onus on claimants to reconsider the strength of their case.
Like any offer, Part 36 offers can be negotiated and nothing is legally set in stone until everything has been agreed. However, once the offer has been made this brings into play a strategic tool which can prove costly to claimants. In the event that the claimant refuses the Part 36 offer of compensation and is eventually awarded a lesser figure in the courts, the legal costs of the defendant will be considered. Under this system the claimant may have to cover the defendant’s costs since the date on which the Part 36 offer was made. If the eventual settlement is higher than the original Part 36 offer then there are no cost liabilities for the claimant.
If the offer is pitched at a level which is almost acceptable this may force the hand of the claimant’s representatives to advise acceptance of the offer. The relatively low margin of error which may result in the judge awarding a lesser level of compensation may prove too risky. However, if the offer is pitched at a level which is inappropriate and unacceptable then it can be dismissed out of hand – or renegotiated.
Summary
While many people still believe they can represent themselves when seeking compensation, the above scenarios suggest otherwise. In order to maximise compensation you need to know how the wheels of law move and which levers to pull. Tools such as the Part 36 offer can be extremely useful and place the other party in a difficult position. The key to a successful outcome is to know the strength of your case, have the relevant evidence to hand and not be rushed into accepting an early offer. Above all, take advice from your personal injury solicitor!
