Justice Committee launches new inquiry into small claims limit

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The Justice Committee has launched what it called “a short inquiry” into the UK government’s proposals for raising the small claims limit for personal injury via secondary legislation.

A single evidence session will be held early in the New Year.

The Justice Committee said it will take into account published written evidence that was submitted to the previous committee’s unfinished inquiry into whiplash and the small claims limit, as well as oral evidence on this topic taken in February.

Further written submissions may be made, but only if they raise new points, according to the Justice Committee.

Potential topics include the impact of raising the small claims limit to £5,000 for road traffic accident-related whiplash claims, and of raising the small claims limit to £2,000 for personal injury claims more generally, taking account of the planned move towards online court procedures.

Written submissions on the potential impact of this policy on the role of claims management companies and on the operation of the market for ‘before the event’ legal expenses insurance are also welcome.

The deadline for written submissions is 22 December.

The inquiry announcement swiftly follows the Justice Committee’s recommendations to improve the draft clause that the government intends to use to amend the personal injury discount rate for catastrophic claimant awards.

In those recommendations, the Justice Committee urged the government to clarify its aims, gather proper evidence about how claimants invest lump-sum damages and whether investment covers their future losses, and ensure adequate safeguards to prevent under-compensation of the most vulnerable claimants.

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