Both parties to a personal injury claim, whether making or responding to the claim, are subject to legislative disclosure obligations.
In the lead up to any negotiations, there is a legislative requirement for the parties to undertake investigations and obtain the evidence they ultimately believe will prove their case.
For instance, information that may be relevant to your personal injury claim may include, but are not limited to:
• details surrounding the circumstances of the incident;
• nature of the injuries you sustained;
• ongoing restrictions concerning your activities of daily life;
• care and assistance you have received;
• any pre-existing illnesses or injuries that may impact on the extent of your personal injuries;
• costs incurred by you in relation to your rehabilitation;
• any economic loss sustained.
Supporting documentation in the form of your medical records, employment and earnings history, income derived from any statutory body (such as Medicare and Centrelink), receipts evidencing your out of pocket rehabilitation expenses, and documents relating to any prior personal injury claim, are also required to be disclosed.
Other evidence may be in the form of private investigation reports, CCTV footage. slip test reports, medico-legal reports, taxation records, forensic accounting reports and the like.
The parties must exchange all of the evidence obtained, regardless of whether or not it bolsters your claim, or puts certain arguments into question.
Disclosure is an ongoing process.
In addition, prior to attending a compulsory conference and/or during court proceedings, the parties will also deliver a court ‘List of Documents’ form to each other, so that each party can then request copies of any documentation that may have inadvertently not been disclosed.
Disclosure is a mandatory requirement and the parties cannot attend a compulsory settlement conference without certifying that they have complied with the procedural requirements of the Uniform Civil Procedure Rules 1999 (Qld). This includes fully complying with their obligations to give the other party all material relevant to the claim whether in their possession, or in their power of possession.
It is important to note that any information or documentation that may have an impact on your personal injury claim is disclosable. Accordingly, insurers will request your medical and earnings history for the period at least three years preceding the incident that caused your personal injury, until the date your claim is settled or presided over in Court. While the three year period immediately preceding the incident is the general rule, if any pre-existing injury, illness or personal injury claim exists beforehand, and is relevant to the current personal injury claim, then the parties are at liberty to obtain information and documentation in that regard also.
Essentially, all information and documentation relevant to your personal injury claim is disclosed between the parties, so that there is a set evidentiary baseline for negotiations, or for court determination.
If you have any queries regarding material that may or may not be disclosable in relation to your personal injury claim, please do not hesitate to contact our litigation team.
(xii) Quantum / Compensation Amount
Prior to undertaking any calculation of the quantum of your claim, or how much compensation your personal injury claim is worth, there must first be an assessment with respect to liability for the accident, and whether any percentage for contributory negligence applies. It is also important that all evidence supporting your claim is obtained, so that accurate calculations may be made.
Once the issues of liability and contributory negligence are settled, as well as the provision of all evidence required, then an advice on quantum can be prepared. If you settle your claim or a Court makes an award in your favour, the money you receive is referred to as “damages”.
A quantum advice will set out the likely low and high ranges of damages you can expect to receive in compensation as a whole.
The quantum of your claim is calculated with regard to numerous heads of damage which are outlined below.
Calculations are complex, and rest on the facts and circumstances surrounding your particular personal injury claim. The quantum is assessed on a case by case basis, as every personal injury claim is different.
For your information however, we will explain some of the key characteristics that are considered when calculating the amount your personal injury claim is worth, having regard to each head of damage.
A. General Damages
The term general damages refers to your pain, suffering and loss of amenities as a result of the injuries you sustained in the incident.
In Queensland, an award for general damages is governed by the Civil Liability Act 2003 (Qld). The Civil Liability Regulation 2014 (Qld) further sets out the range of awards for specific injuries.
However the legislation does not apply to injuries for which workers’ compensation is payable. In workers’ compensation personal injury claims, a claimant may be entitled to general damages based on common law principles. Common law general damages are usually much higher than the general damages amount prescribed by the Civil Liability Act 2003 (Qld).
For the purposes of this practical guide, we will concentrate on the legislative allowances for general damages.
As a preliminary step, the legislation requires us to first ascertain the claimant’s dominant injury; whether it be neurological, orthopaedic, disfigurement or psychiatric. This assessment will take into account the evidence contained in medico-legal reports obtained from experts whom provide an opinion as to a percentage of whole person impairment.
The dominant injury may have the highest percentage of whole person impairment, or otherwise be the most debilitating to the claimant.
The regulations then provide a range of item numbers attributable to each dominant injury, and assesses each injury as minor, moderate, or severe in accordance with an array of example circumstances.
The regulations then state that injuries falling under a particular item, carry an Injury Scale Value (ISV) of between 0 and 100, which then translates to a correlating monetary figure for an award of general damages.
However, in calculating general damages, regard must also be had to the claimant’s associated injuries, in conjunction with their dominant injury. An example may be associated disfigurement from surgical scarring pertaining to a dominant orthopaedic injury, and/or associated psychological injuries.
With these associated injuries in mind, a further review of the Civil Liability Regulations 2014 (Qld) is conducted in order to ascertain whether they fall within a minor, moderate or severe range. The claimant can then be entitled to an ‘uplift’ of up to 25% on top of their general damages award.
Pursuant to the legislation, interest is not payable on general damages awards.
Calculating an award of general damages to compensate a person’s pain and suffering is a complex exercise. It revolves around the medico-legal evidence obtained in respect of a claimant’s injuries, and then legislative provisions are referred to in order to assess the appropriate range of damages that may be payable.
A calculation of pain and suffering will not provide an exact amount as it depends on multiple factors, such as:
• a person’s dominant injury;
• any associated injuries;
• a percentage of whole person impairment awarded; and
• the impacts of the injury on their activities of daily living,
Following the abovementioned formula however, will provide a low and high range calculation of what a claimant might expect to receive as an award for general damages.
Given the complexities, and calculations requiring an examination of the evidence surrounding each case, please contact us to discuss the merits of your particular personal injury claim.
B. Economic Loss
Awards for economic loss take into account your past loss of earnings, anticipated future loss of earnings, together with your past and future losses of superannuation entitlements.
Past Economic Loss
When calculating your past economic loss, a Court will take into account the time you required off work as a result of your injuries. This may include time lost immediately following the incident allowing you to convalesce, and time off work for surgical intervention, rehabilitation consultations such as physiotherapy and counselling, gradual return to work programs and other intermittent time required due to your symptoms.
Both parties will obtain your taxation records for the three years preceding the incident giving rise to your personal injury, and the period following your injury up to the date of settlement or trial. Your employment records may also be obtained as part of the evidentiary process.
An analysis of your earnings and employment history will be undertaken in order to assess the difference between your pre-accident earnings and post-accident earnings. This difference will make up your past economic loss claim.
As tax is not payable on any lump sum settlement award, your economic loss will be calculated based on your net (after tax), rather than gross (before tax), earnings.
Pursuant to section 54 of the Civil Liability Act 2003 (Qld), any award of damages for loss of earnings is limited to three times the present value of average weekly earnings for individuals. That is, even if you are an extremely successful and highly paid employee or businessperson, your past economic loss claim is limited to a maximum of three multiples of the average weekly earnings for any person in Queensland.
Interest is payable on your past economic loss.
Future Economic Loss
When calculating your future economic loss, a Court will consider many factors, including but not limited to:
• the extent and severity of your injuries;
• your qualifications;
• your work history and experience;
• the physical demands of your chosen occupation;
• your potential education or training conducted for future career progression;
• whether you are able to continue working in your pre-accident occupation, either in a full or partial capacity;
• whether modified and restricted duties and/or limited hours assists in keeping you employed in your chosen employment;
• if you cannot undertake your pre-accident occupation, whether you are suited to alternate employment for which you are appropriately qualified or experienced;
• if so, any differences in income between these employment roles;
• any further time required off work for ongoing medical treatment and rehabilitation;
• whether your injuries have caused other future anticipated losses such as loss of business, overtime, promotion opportunities, and/or expected increases in wage under enterprise bargaining agreements or performance reviews;
• if you were not receiving a salary, drawing guidance from your pre-accident and post-accident commissions or drawings from business income;
• whether you have been demoted in your chosen occupation as a result of your injuries and limitations;
• your current age;
• your anticipated life expectancy; and/or
• any potential disadvantage you may experience when applying for employment in the open labour market as a result of your injuries.
Previously, Courts have been reluctant to award potential damages above the age of 60 years, although future losses of earnings have recently trended towards a retirement age of 65 years with some judges now making an allowance up to age 67.
Drawing parallels from the past economic losses, any future economic loss claim will require both parties to investigate your taxation and employment records to deduce any evidentiary trend that may assist in determining your likely future employment and earnings projections.
Losses will also be calculated using projected net (after tax) earnings and are considered on a case by case basis. Likewise, section 54 of the Civil Liability Act 2003 (Qld) also applies – limiting any award of damages to three times the present value of average weekly earnings for individuals.
Interest is not payable on any claim for future economic loss.
It is difficult to quantify future economic loss with exactness and depending on the evidence available, sometimes a global compensation award will be sought and awarded. Likewise, future economic loss claims may also be discounted for contingencies and vicissititudes of life, taking into account any potential for changes in circumstances or fortunes.
Courts appreciate that quantification of damages for loss of economic capacity defy precise calculation and involve, the ‘double exercise in the art of prophesying’ (as Lord Diplock said in Paul v Rendell i(1981) 55 ALJR 371, and adopted by McMeekin K in Nucifora & Anor v AAI Ltd  QSC 338. Accordingly, global claims are often appropriate.
C. Loss of Superannuation
In certain circumstances, section 57 of the Civil Liability Act 2003 (Qld) provides an entitlement to claim any associated losses of superannuation in accordance with the minimum statutory percentages applicable to your earnings.
As superannuation rates are legislated to increase over time, your claim for future loss of superannuation will take into account the higher statutory rate anticipated.
Percentage calculations will be based on your respective past and future economic loss claims.
Interest is payable on past losses, but not payable on any award for future loss of superannuation entitlements.
D. Special Damages
Special damages, in part, refers to any injury-related benefits received from statutory departments such as WorkCover Queensland, Medicare Australia, Centrelink, Veteran’s Affairs, Education, Employment and Training, and Services Australia. These benefits will comprise ‘statutory refunds’ that will be owed upon settlement of your personal injury claim, as s reimbursement to the relevant department that funded some of your injury-related expenses.
Special damages also includes your injury-related out of pocket expenses incurred for medical treatment, rehabilitation, counselling, pharmaceuticals, aids and equipment, and associated travel expenses to attend appointments.
The case of Wilson v McLeay (1961) 106 CLR 523, also provides authority for the recovery of out of pocket expenses incurred for necessary travel related expenses such as fares, accommodations and costs, for a parent or relative to care for the injured person.
All special damages, be they statutory benefits or out of pocket expenses, are built into your personal injury claim, so that the relevant parties are appropriately refunded for the injury-related expenses incurred.
It is important you keep a log and receipts of any expenses you pay for out of your own pocket, as well as a diary detailing your injury-related appointments and distance of return travel. This will evidence your claim for past special damages.
Interest is payable on monetary awards for past special damages.
Your evidence retained for past special damages may also indicate an appropriate award for anticipated future special damages. Both parties will also assess any medical evidence obtained, including medico-legal reports from appropriately qualified specialists, which will indicate whether you will require future medical treatment, surgerys costs, rehabilitation expenses, counselling, pharmaceuticals, aids and equipment, vocational training and courses, and the like.
Depending on the evidence available, you may also be entitled to monetary compensation for special damages envisaged for the future.
If so, any futures calculation will also take into account your current age, your anticipated life expectancy (including other considerations for pre-existing injuries and illnesses that may decrease any average expectancy), and the years of life you likely have remaining.
A global claim for future special damages os made after reviewing all evidence and material factors.
E. Statutory Refunds
As noted above in the Special Damages section, if your personal injury claim is successful and you receive compensation, any payments made to you by WorkCover Queensland, Centrelink, Medicare Australia, the Department of Education, National Disability Insurance Scheme, Employment and Workplace Relations or a private health insurer, must be repaid to these agencies from the damages award. These amounts are factored into any settlement offer or court judgement.
Prior to the conclusion of your claim, we will obtain statements of the amounts paid from these agencies so that we may build the statutory refunds amounts into your claim for damages.
The only exception is Centrelink as it no longer gives claimants a statement of compensation charges and preclusion periods. Instead, they now ask claimants to estimate these refund and preclusion period amounts themselves using an online Compensation Estimate Calculator. We are able to perform a number of estimates using the Centrelink Estimate Calculator and give you a “best case – worst case” range of the possible amount you may need to refund to Centrelink, and the period of time you may be precluded from receiving Centrelink benefits.
While we will do our best to provide a realistic estimate based on the information you have given us, in the absence of definitive statements from these statutory agencies, estimates concerning the refunds amounts owed may represent a “best guess” and the final demand from relevant departments may be more or less.
F. Gratuitous Care & Assistance
This head of damage refers to the care and assistance you received gratuitously from your friends, neighbours and/or relatives in respect of your injury-related limitations and restrictions.
The policy consideration is that your friends and family should be compensated for the level of domestic care and assistance they provided you, to the value that an independent service provider would receive, per commercial market rates, depending on the type of task performed.
Such compensable care and assistance encompass many tasks such us household chores and maintenance, gardening and lawn care tasks, vehicle maintenance and transport requirements, and any assistance provided in activities of daily living such as showering, toileting dressing, grocery shopping, meal preparation, assisting you with bed and chair transfers and the like.
You will have had to have perform such tasks prior to the incident that caused your injuries and be unable to subsequently perform those tasks post-accident.
Griffiths v Kerkemeyer (1977) 139 CLR 161 provides the common law principle that damages are recoverable if the relevant loss is caused by the claimant’s incapacity for self care and that loss is to be quantified by reference to the value or cost of providing the needed services.
This case was later restricted by section 59 of the Civil Liability Act 2003 (Qld) insofar as the services must be necessary and arise solely from the injuries sustained in the incident. Moreover, the legislation now imposes a minimum threshold so that in order to advance a claim for gratuitous care and assistance, care and assistance must be provided for a minimum of 6 hours per week over 6 months, before it can be considered compensable.
Any past claim will turn on the evidence that can be obtained from the person/s who provided you with the relevant care and assistance, and if it meets the threshold requirement, interest will also apply.
Your future claim for gratuitous care and assistance, if applicable, will also consider evidence as to your current needs and specialist medico-legal evidence commenting on your likely future needs. A claim for future care and assistance must have previously met the past gratuitous threshold.
As with all other heads of damages, calculations are made on a case by case basis, and if the threshold requirement is met, global claims will likely apply as it is difficult to quantify the exactness of any future award. Likewise, future care and assistance will consider your age, life expectancy, years of life remaining, and may be discounted for the vicisstitudes of life.
G. Loss of Servitude / Consortium
In some circumstances, an award for damages for loss of servitude and loss of consortium may apply. Section 58 of the Civil Liability Act 2003 (Qld) provides an award only applies if the injured person has died as a result of the injuries suffered, or their injuries are so severe that their general damages meet an amount prescribed under regulation.
If applicable, this action is brought by a spouse to recover loss suffered as a result of being deprived of the comfort, society, and services of their injured or deceased spouse.
H. Exemplary, Punitive or Aggravated Damages
Generally, exemplary, punitive or aggravated are not awarded in personal injury claims. That said, section 52 of the Civil Liability Act 2003 (Qld) allows such damages to be awarded in limited circumstance. Specifically, if the act that caused the personal injury was an unlawful intentional act done with intent to cause personal injury, or an unlawful sexual assault or other unlawful sexual misconduct.
I. Impact of National Injury Insurance Scheme
Following a motor vehicle accident, if the injured person then becomes a participant in the National Injury Insurance Scheme, damages for personal injury may be restricted.
Specifically, section 52B of the Civil Liability Act 2003 (qld) legislates that courts cannot award damages in relation to the injured person’s treatment, care and support needs result from the personal injury, and arise or arose when the person is/was a participant in the insurance scheme.
If however, the person is a lifetime participant of the National Injury Insurance Scheme as a result of personal injuries sustained in a motor vehicle accident, and the Compulsory Third Party insurance agency is liable, then section 62C of the Act allows a court to award the CTP insurer’s contribution towards treatment, care and support damages.
J. Legal Costs
Depending on the quantum of your claim, you may be entitled to an award for legal costs. A legal costs award however, does not necessarily mean all of your legal costs will be paid. Rather, the awards are split into three categories:
• Regulation Costs
• Standard Costs
• Indemnity Costs
For further information, please refer to the Costs Awards section.
(xiii) Costs Awards
Depending on the quantum of your claim, you may be entitled to an award for legal costs. A legal costs award however, does not necessarily mean all of your legal costs will be paid. Rather, the awards are split into three categories:
• Regulation Costs (also known as Declared Costs)
• Standard Costs
• Indemnity Costs
Each category is discussed in further detail below.
A. Regulation Costs
These costs are prescribed by regulation and declare a specific costs award having regard to the amount of damages that are payable upon settlement or court award of your personal injury claim.
The declared costs award depends on the applicable Act and Regulation, the date the personal injury arose, and is restricted by an award of damages falling between lower offer limit and upper offer limit.
For example, section 27 of the Motor Accident Insurance Regulation 2014 (Qld) provides that for injuries sustained:
• Between 1 July 2019 to 30 June 2020, regulation costs are declared at $3,910, providing the personal injury claim settled for an award of damages between the lower offer limit of $46,800 and upper offer limit of $78,040;
• On 1 July 2020 or after, the regulation costs are declared at $4,000, providing the personal injury claim settled for an award of damages between the lower offer limit of $47,850 and upper offer limit of $79,790.
As you will see, the declared regulation costs award increases over time, having regard to inflation.
It is important to note that these costs are prescribed by regulation, so if your personal injury claim settles for, or a Court awards damages for, a sum that falls between the lower and upper limits, the legal costs component cannot be any less or any more than the declared amount.
If the personal injury claim settles, or a Court awards damages, for a sum less than the lower offer limit, there will be no provision for legal costs. If however, the claim settles, or a Court awards damages, above the upper offer limit, standard costs may apply.
B. Standard Costs
Standard costs are typically higher than the declared regulation costs award. If your personal injury claim settles, or a Court awards damages, for a sum above the upper offer limit prescribed by regulation, standard costs may apply.
Costs are ordinarily assessed on a standard basis or can otherwise be agreed between the parties.
Standard costs include all costs necessary or proper for the attainment of the settlement, compensation sum, or damages award applicable to your personal injury claim.
Importantly, you will not recover your entire legal fees arising from the claims process (as is the case with indemnity costs) but rather, the costs will be calculated pursuant to a Court scale.
The court scale provides a set amount for professional legal fees depending upon each task undertaken (for example, emailing correspondence, attending court, briefing counsel) however, the costs are calculated on a standard basis and have a capped limit (for example, for each 100 words of drafting a document an award of $20.70 is provided, an email transmission costs $0.60, a court attendance attracts an award of $81.50 per quarter-hour). The court scales are different in the Magistrates, District and Supreme Courts and are updated regularly.
The other party may simply agree to a sensible estimated amount for the standard legal cost component. However, they may also require the file to be cost assessed to ensure accuracy pursuant to the court scale. It depends upon the position taken by the other party. A cost assessment is an additional expense to be borne by the parties and so, the party that is to pay may be open to negotiating the legal costs component in conjunction with the remainder heads of damage in your personal injury claim during the negotiation phase.
Suffice to say, costs on a standard basis, ordinarily amount to far less than privately charged legal fees.
Notably, a Court can award standard costs against you, in favour of the insurer, as a consequence to the Mandatory Final Offer process required by compulsorily legislated settlement conferences. That is, you may be required to pay the insurer their legal costs on a standard basis, if you are not careful in the formal negotiation process. These cost consequences are discussed further below, under Mandatory Final Offers.
C. Indemnity Costs
Indemnity costs are governed by Rule 703 of the Uniform Civil Procedure Rules 1999 (Qld) and generally encompass the entirety of your actual legal costs, charged by your legal representatives in accordance with their hourly charge out rates and the relevant time spent in completing each task , plus third party disbursement expenses.
When a court assesses costs on an indemnity basis, it allows for all costs reasonably incurred by the party, having regard to:
• the prescribed court scale of fees;
• any costs agreement between the party and their solicitor; and
• charges ordinarily payable by clients to solicitors for work involved in the personal injury claims process.
Items will only be excluded from an indemnity costs award if a court finds that particular cost was unreasonably incurred or for an unreasonable amount. Indemnity costs are far broader than standard costs and are generally awarded when a party is found to have conducted their case improperly by acting in an unreasonable manner that protracted the personal injury claim process.
Indemnity costs can be awarded to either party, as a consequence to the Mandatory Final Offer process required by compulsorily legislated settlement conferences. That is, you may be required to pay the insurer their legal costs on an indemnity basis, if you are not careful in the formal negotiation process. Although mostly, an indemnity costs award attaches to the respondent to the personal injury claim rather than the claimant – depending on the parties’ behaviour. These cost consequences are discussed further below, under Mandatory Final Offers
(xiv) Informal Negotiatons
During the course of your personal injury claim, it may be tactically beneficial for the parties to undertake informal ‘without prejudice’ negotiations with a view to expediting the settlement of the claim and avoiding substantial legal costs that are incurred in the compulsory conference stage.
An informal offer is prepared by way of correspondence, setting our your claims under each head of damage and the evidence supporting your claim. The respondent to the personal injury claim generally responds with a written counteroffer, and the negotiating process evolves from that point onwards. Generally, multiple communications between the solicitors ensue with a view to seeing if the claim can be settled early.
If a settlement cannot be reached, the parties may elect to obtain further evidence to support the weaknesses identified in the personal injury claim, and advance towards a compulsory conference.
(xv) Compulsory Conference
Pursuant to relevant governing personal injury legislation, parties are required to attend a compulsory conference in an attempt to resolve the claims, prior to bringing an action in Court. This legislative requirement has an overarching policy consideration, as it ultimately frees the Courts from hearing personal injury matters that might otherwise be able to settle without judicial involvement.
Importantly, parties can only attend a compulsory conference if they have gathered all the information and evidence they intend to rely upon, as if they were headed to trial, presided by a judge in court.
A. Certificate of Readiness
In the lead up to the compulsory conference, each party to the personal injury claim must legislatively provide the other side with a Certificate of Readiness that states:
• they are in all respects ready for the compulsory conference, and subsequent trial (if required);
• all investigative material required has been obtained;
• medical or other expert reports have been obtained from all persons the party proposes to call as expert witnesses;
• they have fully complied with their disclosure obligations to give the other party material relevant to the claim; and
• the solicitor has provided their client with a Costs Statement setting out all information legislatively required.
The Certificates of Readiness must be exchanged one week prior to the compulsory conference convening.
B. Costs Statement
The correlating Costs Statement, as referred to in the Certificate of Readiness above, is required by legislation to set out:
• details of the legal costs (clearly identifying costs that are legal fees and disbursements) payable by that party, to their solicitor, incurred up to and including the compulsory conference stage;
• an estimate of the likely additional legal costs (clearly identifying costs that are legal fees and disbursements) if the personal injury claim proceeds to trial to be determined by the Court; and
• a statement of the cost consequences that attach to particular scenarios should a Court award damages for a sum that is less or more than a party’s Mandatory Final Offer exchanged at the compulsory conference.
The Cost Statement must be provided to the relevant party at least one week before the compulsory conference, and prior to the delivery of the Certificate of Readiness to the other party.
C. Conference Process
The compulsory conference is usually convened either at insurer or solicitor offices or at counsel’s chambers where multiple conference rooms are available.
At the commencement of the compulsory conference, the parties will all convene in the one room. Counsel will open with arguments in support of your personal injury claim which will provide insight into the impact of the injuries sustained on your daily life, and will delve into the evidence relied upon when calculating the quantum, or worth of your claim.
Likewise, the respondent’s solicitors (perhaps with counsel also) will provide a counter argument as to the evidence they prefer with respect to liability and/or, in support of their calculations on the worth of your personal injury claim. It is in this session that the insurer may also ask questions and seek further clarification from your lawyer as to certain aspects of your injuries, the impact upon you and your employment and earnings, the out of pocket costs you incur, the future surgeries, treatment, aids, equipment, care and assistance you may require etcetera.
In addition, the insurer may also raise life expectancy and/or pre-existing injuries and illnesses to argue that your future damages awards should be reduced or discounted.
Depending upon the questions asked we may agree to answer any queries in that initial joint session or simply advise the insurer that we will seek your instructions independent of their presence, and counsel will revert to them later with your responses.
It is at this point in time that the parties will split into separate ‘break-out’ rooms, and where negotiations will commence.
When the parties split into separate rooms, your legal team may traverse back and forth with the respective parties’ exchanging counteroffers and their associated arguments advanced for each counteroffer. Obviously, the aim is that the parties ultimately reach an agreed settlement, and the personal injury claim settles at the compulsory conference.
During the exchanging of offers, we will keep you regularly informed of each parties’ position, the tactical process we feel best to adopt, and seek your instructions on each counteroffer made. You will be able to ask us any questions that arise throughout this process. We will also update you upon each offer exchanged, as to the amount you can expect to receive ‘in the hand’ following deduction of your legal fees, disbursements and any statutory refunds payable, from the overall settlement sum.
Should a settlement sum be reached, it is possible, that the insurer will seek your file held by your lawyers be assessed by a qualified costs assessor following the compulsory conference, in calculating the legislative award for the legal costs component they are statutorily obligated to pay. As mentioned above, a costs assessor will evaluate our file and calculate the legal costs award pursuant to the applicable court scale.
(xvi) Mandatory Final Offers
In the event the personal injury claim does not settle, Mandatory Finals Offers (also known as MFOs) are subsequently exchanged at the conclusion of the compulsory conference, but while the parties are still present.
As the name suggests, the offers represent the parties’ final position in negotiations, and are mandatory in accordance with governing legislation. These Mandatory Final Offers remain open for a period of 14 days from the date of the compulsory conference, for either party to accept. If the 14 day period lapses and neither offer is accepted, then the expiry is taken as a rejection of the MFO.
There are however, potential legal cost consequences when it comes to the exchanging of Mandatory Final Offers in terms of any subsequent Court judgment, and so the parties must be strategic in the offer advanced in writing.
Should your personal injury claim advance to trial, each party’s Mandatory Final Offer is sealed in an envelope and opened by the Court following the judge’s determination on the damages award. In the event the judicially decided compensation figure is above the figure in your Mandatory Final Offer, the insurer may be ordered to pay your indemnity costs (that is, the entirety of legal costs charged) from the date of the compulsory conference up to and including the trial.
However, if the judge awards a damages figure for an amount less than your Mandatory Final Offer but above the figure set out in the respondent’s Mandatory Final Offer, the respondent will most likely only be ordered to pay your standard costs from the date of the compulsory conference up to and including the trial. That is, you will not recover your entire legal fees as is the case with indemnity costs but rather, the costs will be calculated pursuant to the applicable court scale. Costs on a standard basis amount to far less than privately charged legal fees.
Should the judgement award fall under the Mandatory Final Offer provided by you to the respondent, then you will have to pay for the respondent’s legal costs, from the date of the offer to the end of the matter, usually calculated on a standard basis although there is discretion for an indemnity costs award depending on the circumstances of the claims process.
Given the cost consequences associated with the Mandatory Final Offers, it is very important that the parties’ are strategic in the figure exchanged. Should the compulsory conference advance towards this stage, we will provide you with carefully considered advice regarding the amount to be put in the Mandatory Final Offer, and our devised strategy in light of the negotiations on foot.
(xvii) Instituting Court Proceedings
In circumstances where Mandatory Final Offers are exchanged, should neither party accept the other party’s offer within the 14 day period, then you must institute proceedings in a Court, in order to advance the matter towards trial. You will have 60 days from the conclusion of the compulsory conference to institute Court proceedings via the lodgement of a Claim & Statement of Claim, which will be prepared based on the quantum previously calculated as the worth of your personal injury claim.
Failure to lodge a Claim & Statement of Claim in the Court during this period will result in the claimant being statute barred from pursuing their personal injury claim. Accordingly, the 60 day period acts as another limitation period to the personal injury claim. Once served however, the time limitations that apply to the personal injury claim are effectively stayed pending the court process.
In circumstances where a limitation period attaching to a personal injury claim is almost due to expire, but the compulsory conference is yet to be convened, Court proceedings may be instituted by Application, so as yo stay the limitation period. The parties will then have to revert back to the pre-court procedures required by legislation, in an attempt to settle the claim expeditiously. Should this occur, the relevant limitations will be reactivated upon the convening of the compulsory conference. If the personal injury claim does not settle following the compulsory conference, then the Court procedures are subsequently followed.
During this 60 day period, but following the expiration of the 14 day Mandatory Final Offer period, either party may wish to again attempt to negotiate a settlement on an informal basis. We would likely only recommend this option if the parties are relatively close in their final offers and the legal costs involved in instituting court proceedings outweigh any advantage that may be obtained.
Obviously, we would need to provide our advice on strategy bespoke to the circumstances at that point in time. Further, our recommendations at that time would also hinge on the quantum ranges previously estimated by us or counsel in their advice, in comparison with the respondent’s negotiating position. It may be that the insurer would be willing to increase their offer following the expiration of their Mandatory Final Offer in an attempt to avoid the costs associated with court procedures and protracted litigation.
Should you institute proceedings, the respondent then has a further 28 days from the date of service of your Claim & Statement of Claim, to file and serve a Notice of Intention to Defend & Defence. You are then required to file a Reply in response to the Defence served by the insurer within 14 days.
Rather than delve into the entire and sometimes overwhelming court procedures, we simply touch upon the initiating process at this stage. In the event a settlement cannot be reached at compulsory conference or shortly thereafter, we will set out the complete court procedures to be followed in advancing the personal injury claim towards trial.
Unfortunately, court proceedings can be a rather lengthy and involved process, over and above the timely pre-court procedural course the personal injury claim has already taken. Accordingly, a comprehensive outlook on court procedures is provided only when necessary, as it is our aim to have the personal injury claim reach a settlement favorable to our clients at compulsory conference if not beforehand via informal