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Gifts (not) in Disguise: Inducing Prospective PI Claims

New legislation that seeks to end the compensation culture has been unveiled in response to unabated levels of frivolous and fraudulent claims.

Since the term was coined in the early Nineties in response to the litigious nature of the American justice system, the ‘compensation culture’ has crippled the legal services profession in the same way that other American exports – naming no ‘McNames’ – have crippled everybody else.

Lords Usher in Reform
Welcome gifts, such as offering iPads preloaded with software that guide clients through the claims process, have been outlawed in a bid to cut away swathes of ‘non-cases’ from the civil justice system. Endorsing a long overdue clean up, the House of Lords has motioned to sanction these inducements by incorporating them into the Criminal Justice and Courts Bill that is currently at the Committee Stage in the Lords.

Peers from both sides of the political spectrum have come out in support of this inclusion. Minister of Justice Lord Faulks QC, and Lord Beecham from the Labour benches are unified the belief that this measure will compliment existing reform and is a step – not a trip! – in the right direction.

A Double Standard?
Restricting claims on merit should restore the reputation of the legal services industry, which as a whole has been blighted by the prominence of a small contingent of firms who have begun to dominate advertising in print, online and – most notably – on the television. Indeed, the decision to expand the definition of inducements to include both monetary and non-monetary gifts signifies the hard line the legislature is taking. Such a response is understandable but there is significant doubt as to whether these reforms will yield the desired result.

Personal injury lawyers have found these reforms insulting, especially from one of the few ministers from the Ministry of Justice who is supposedly their “Learned Friend”. At a time when livelihoods are already in jeopardy citing a double standard between lawyers and insurers, who are also inducing customers – albeit with plush meerkats – is an obvious conclusion to come to.

Conceptually, advancing damages up front shouldn’t be too abstract but when these inducements make a real difference to whether claims are pursued, rather then whether a particular firm is chosen over the other, action must be taken.

The necessity behind these reforms is clearly not going to satisfy the legal services industry but perhaps these concerns can be addressed with a complimentary iPad? I sincerely doubt it in spite of the number in circulation.