Category: The Courts

Average personal injury awards did go up in 2014, not claims

For over a year now the Irish insurance industry has been spinning dramatic price hikes in car insurance as being the result of claims – those awful people injured in car accidents who dared to claim against insurance are the fault, along of course with their lawyers.

It is quite obvious that there are multiple factors at play in the car insurance market. New regulatory rules, bad investments, bad management and years of overly-aggressive competition are clearly the major factors now biting the industry. But it is far easier to blame lawyers, demonise claimants and pretend whiplash is an imaginary injury.

But two things have taken the wind out of the insurance industry spin: the Injuries Board using actual research and statistics to counter the allegations and the dramatic intervention of the Competition and Consumer Protection Commission.

One spin in particular, though, will not die: the suggestion that there was a huge jump in court injury awards from 2013 – 2015. On RTÉ’s Nine News last night (5 October 2016, from 1:43) Kevin Thompson, CEO of Insurance Ireland, made the claim again:

We’ve also seen a 33% increase in the level of awards in the Circuit Court from 2013 – 2015.

This is amazing. Injury awards suddenly up by one third! But this claim, often made by insurance industry spokespeople, raises two obvious questions: (1) why did this happen in the Circuit Court?; and (2) what happened between 2013 and 2015?

The answer is simple. In 2013, the Courts and Civil Law (Miscellaneous Provisions) Act 2013 was introduced. It, among other things, raised the jurisdiction of the Circuit Court, so that court could deal with some higher-value claims. So yes, average awards went up.

The District and Circuit Courts have upper limits on the compensation they can award and until 2014, when the law took effect, the maximum the Circuit Court could award was €38,092.14. That odd figure is £30,000 in old money, hinting that the limit had not been changed in a very long time. In fact, since the late 1990s many argued for an increase in jurisdiction for the District and Circuit Courts to address inflation and the changing nature of litigation. In 2010 I wrote that such a change was long overdue and would help to reduce legal costs. The government had introduced a law in 2002 to allow them to change jurisdiction limits but failed to do so, partly due to insurance industry lobbying.

Increasing the jurisdiction of the lower courts allows them to hear a range of cases that they are more than capable of dealing with, at a lower cost. So, increasing court jurisdiction limits should reduce legal costs.

The increase in Circuit Court jurisdiction in 2014 raised maximum personal injury awards by that court by €21,907.86 – around 57%. This is a significant increase and one which has an immediate impact on statistics, particularly average awards. There is no reason that a Circuit Court judge would award more than a High Court judge in a particular case, so there should be no award inflation. But the average Circuit Court injuries award will naturally increase. Likewise, at High Court level, the average award increases because the lower value awards up to €60,000 are taken out.

So, it is not at all surprising that there was an increase in Circuit Court compensation levels from 2013 to 2015 – the jurisdiction level increased 57% but the average award only 33%. Average award levels limited to one court jurisdiction are of little use in considering the overall levels of compensation awarded or general claims activity.

What the insurance industry does not say, and cannot say, is that this 33% was a result of overall compensation inflation.

Insurer spin on compensation working, despite evidence

"Claim? But what about our international reputation!" — “Claim? But what about our international reputation!”

The insurance industry is taking advantage of the current interregnum to step up its media campaign against paying compensation to injured parties. This is a concerted campaign with almost daily media reports of the damage allegedly high compensation levels and legal costs are doing to the insurance industry, the economy and even Ireland’s foreign direct investment. It appears to be working, despite all evidence suggesting that other factors are causing premiums to increase.

Today is the turn of the Small Firms Association, who claim that compensation “culture” is now “out of control”. According to the SFA:

Since 2011 insurance costs have risen by 30 per cent, the association said, with a large part of the jump occurring within the past 12 months.

What you won’t find anywhere, however, is evidence to suggest that this huge hike in premiums has been caused by compensation, or how “compensation culture” is “out of control”. On the contrary, all indications are that the main reasons for insurance increases have nothing to do with compensation. Industry spin is having the desired effect, however, with even Minister for Jobs, Enterprise and Innovation appearing recently to come around to the industry point of view.

I recently requested documents from the Department of Jobs, Enterprise and Innovation on representations by the insurance industry and in the documents released were records relating to two industry meetings where the Minister was lobbied on insurance costs.

The first meeting was with executives from Axa and was requested through Fine Gael Councillor Anthony Lavin, who is also a customer care manager with Axa. It took place on 8 October 2015. A further meeting took place with Insurance Ireland, the industry body, and was arranged through PR consultants.

The Minister’s briefing materials included a National Competitiveness Council report on insurance costs. Recent newspaper articles have referred to this report and its reference to legal costs supposedly being “sticky”, but generally do not point out other important aspects of the report.

The industry frequently says motor claim awards are too high but “64% of PIAB [Injuires Board] awards for motor injury claims are for <€20,000 … the cost of processing a claim through the PIAB is at historically low levels”.
The review of the book of quantum “could result in higher costs, and ultimately higher premiums.”
Legal costs “proved extremely sticky” apart from “a brief period in 2013”. The evidence for these comments is not referred to.

Minutes of the meeting record that the Minister made a number of counter arguments to Axa on compensation concerns, for example that medical negligence cases skewed comparisons of compensation payments and that the level of awards by PIAB was “fairly consistent” from 2010-2014, with the majority of awards being under €20,000. He said it would be helpful if the industry provided more information on “untracked cases”. These are mostly cases that are settled between claimants and insurers with the result that the State agencies do not learn what the outcome is.

View this document on Scribd

Given that Axa and the industry are seeking a number of reforms that would require them to be given more statistical information by PIAB and the Courts Service, it is peculiar that the industry continues to be remarkably reticent on providing details on untracked cases. The note of this meeting states that Axa agreed to “work with Insurance Ireland with a view to supplying” this type of data.

Axa appeared to focus on what were effectively four case studies of recent court cases where the awards exceeded what the insurers had valued the cases at. Axa were not, in fact, the insurer in any of these cases. A limited number of court awards are not, of course, representative of most claims and indeed the note of the meeting between the Minister and Insurance Ireland on 6 November 2015 stats that about 20% of claims go to PIAB, of which about 40% are rejected and settled and “[a] small number of cases are finalised by the Courts.”

View this document on Scribd

Axa, along with many other parties, has made submissions to DJEI on the operation and implementation of the PIAB legislation, which has been ongoing for some time. A significant suggestion is that the limitation period for personal injury claims be reduced to one year (at the moment the limitation period is two years). This proposal was already considered when the legislation was introduce to establish PIAB and the government decided against a one year limitation period.

It was felt at the time that such a short limitation period would exclude many valid claims or that it would drive people into dealing with lawyers and claims at a time when they might still be receiving treatment or in recovery. A one year limitation period would be extraordinarily restrictive, its only aim and affect being to reduce the liabilities of insurance companies by excluding valid, genuine claims.

View this document on Scribd

A further surprising proposal is to allow PIAB to award “some form of Legal fees to lawyers that will allow for a higher acceptance rate of awards.” The insurance industry’s objective in having PIAB established was to drive a wedge between injured parties and solicitors, who might provide claimants with independent, expert advice. This was to be achieved by the law providing that no legal fees would be awarded by PIAB (except in limited situations, and even then in very small amounts). The industry repeatedly claims that, despite PIAB being intended to be a “lawyer free zone”, over 90% of claimants are represented by solicitors (again no evidence is publicly available to support this claim). Axa’s proposal appears to accept that the right of people to seek professional representation is still exercised in most cases, despite the cost implication at present.

The above documents and some others are available here on Scribd. They suggest that government departments and the National Competitive Council do not necessarily share the views of the industry and are aware of other factors affecting the insurance industry.

However, since the Minister’s meetings with the industry late last year, during which he did not appear to accept what was being said on compensation and PIAB at face value, he has since sought “judicial buy-in” for the as-yet incomplete revisions to the book of quantum and makes the same points on insurance costs put forward by industry representatives.

The bulk of media reporting and commentary on insurance premium hikes remains focused on and obsessed with compensation, with little being said or asked about Solvency II, RSA, FBD and other industry-specific issues.

Insurers still spinning against the facts on personal injury claims

swear-to-spin-the-truth_resize Rarely a week goes by without more insurance industry spin on personal injury claims, particularly whiplash claims. The industry now takes any opportunity to blame personal injury claims for their woes, even in the face of facts which indicate other causes.

Inevitably, the Irish insurance industry is seeking reforms similar to those announced late last year in the UK, including a ban on claims for “minor” whiplash injuries.

AIG, a massive multinational insurer that was in recent years more often in the news for needing an initial $85 billion bailout from the American government, wants a ban to be considered here. Their general manager for Ireland, Declan O’Rourke, told the Irish Times:

Ireland should follow the UK’s lead in considering a ban on whiplash, to flush out fraudulent claims. The UK is considering a position whereby whiplash victims would have their medical expenses and loss of earnings compensated by insurers in a move that it believes could save the sector £1 billion a year and reduce premium costs.

Mr O’Rourke does not go into detail about why a whole category of claim should be banned to weed out the supposed problem of fraudulent claims, but the insurance industry often suggests that all whiplash claims are effectively fraudulent. This is in spite of long-standing medical evidence and opinion. A call for a ban on whiplash claim won’t go far in Ireland, where it would likely be unconstitutional, but other reforms will be demanded. Indeed, it appears AIG has a wishlist of things it would like an Irish government to do, quite a turn-around for a company that had to go cap in hand to the Federal Reserve in 2008 to avoid oblivion. More recently, its Irish operations benefitted from assistance from the Irish taxpayer. One might be inclined to wonder whether any losses or difficulties at AIG could have causes beyond the cost of claims.

Yesterday, Fiona Muldoon of FBD was a guest on Morning Ireland, taking another opportunity to bemoan the cost of claims and the legal system despite FBD’s results telling a different story. FBD has quite reasonably been described as “beleaguered” and has suffered from a range of difficulties which have nothing to do with personal injury claims.

The Times (Ireland edition) covered FBD’s latest results with the headline “Insurance sector too competitive, FBD says” [paywalled]. While the real problem for the industry is in the headline, the article nevertheless begins:

Over-inflated whiplash claims and too much competition between insurers were among the many factors to blame for FBD’s loss-making performance this year, its chief executive said.

The cost of allegedly “over-inflated” whiplash claims is a crutch that the industry repeatedly leans on when in difficulty, while the truth for FBD is that:

Most of last year’s losses stemmed from measures to bolster its capital reserves and €11 million in restructuring costs.

The article also points out that FBD experienced a 9% fall in premium volumes last year – ie. they lost customers. Ms Muldoon continues:

A number of factors had made the Irish insurance sector unprofitable between 2012 and 2014, including too much competition driving down premiums, Ms Muldoon said. “The market in Ireland is very fractured, which meant that companies were competing aggressively against each other and in hindsight they were not charging enough.”

So. Insurance companies have had financial difficulties because they have had to bolster reserves, lost customers and have not charged enough for years. But ask any spokesperson for the insurers about their problems and it’s not long before the cost of claims is front and centre.

This is a remarkable feature of articles on the insurance industry in Ireland over the past year: reports on financial results cover these internal difficulties and challenges faced by the industry which are obviously having a negative impact on premiums. Figures are available to explain the impact on insurers but not, it seems, to explain their complaints about the cost of claims and the legal system.

The reality is that the industry does not have any statistics or figures about personal injury claims that it is willing to make public. Even the Injuries Board, effectively a creature of the industry, has criticised the failure to support allegations about claims, as well as their failure to explain where there premium income is going. The number of personal injury court claims fell in 2014 and the Injuries Board has highlighted that there is a €1 billion difference between the premium income of Irish insurers and published awards.

It’s time for insurers to accept that, this time around, their losses are down to themselves and not due to paying out on claims (which is, of course, what they exist to do).

The MIBI says it will not cover Setanta claims

I wrote in May about the problems which have arisen for third parties claiming against Setanta, which is now in liquidation. A strange series of events unfolded which involved the Minister for Finance, who is not responsible for the Motor Insurers’ Bureau of Ireland, stating in the Dáil that the MIBI had “indicated” that they would cover third party Setanta claims.

The Minister gave no detail and did not say who the MIBI had given this indication to. The Irish Brokers Association circulated a briefing paper to its members which, in 6 pages, said effectively the same thing as the Minister for Finance but which appears to have been based on the assurance given by him in the Dáil.

The Minister for Transport, who is responsible for the MIBI, was more cautious and directed queries to that organisation. I wrote to the Minister for Transport for clarity on the situation and he informed me last month that the MIBI was taking legal advice on its liability in this situation. However, it was clear that they did not believe they had a liability. The Minister said:

I understand that the MIBI considers that it has no liability in instances where an alleged offending vehicle was insured at the time of the accident and that it has never previously been involved when a valid policy of insurance was in place.

The MIBI has now obtained the legal advice which supports this position:

the MIBI Agreement (2009) does not require the MIBI to satisfy awards against drivers covered by a policy of insurance where the insurer is unable to pay all or part of an award due to insolvency.

That clarifies the MIBI’s position but it does not mean that the position is correct. Importantly, it leaves third party claimants pursing claims against a liquidator in the eventual hope of being paid in full, which is unlikely, or claiming against the Insurance Compensation Fund, which is subject to a cap of 65% of the value of the claim or €825,000 (whichever is lower). Of course, the MIBI’s position is based on its own opinion and legal advice and it remains to be seen whether any injured party will challenge that position.

In the meantime, three serious questions remain:

What was the Minister for Finance talking about when he told the Dáil in May that the MIBI had indicated it would cover claims against Setanta?
What does section 4.1.1 of the MIBI Agreement mean when it says that if a judgment is obtained for damages that should be covered by insurance but which isn’t paid within 28 days, the MIBI will pay it “whether or not [it is] in fact covered by an approved policy of insurance” and how does this accord with the MIBI’s legal advice? Does it not, along with clause 4.4, envisage paying out on claims such as those brought against an insolvent insurer or one who refuses to pay?
What is the Government going to do to assist third parties who might now lose out on a significant portion of their compensation through no fault of their own and due to events entirely outside of their control?

The Setanta car crash: what about injured parties?

The collapse of Setanta Insurance is not just a shambles for policyholders. They, at least, could arrange new insurance and at worst lost only the unexpired value of their policy. But what about someone injured in a road traffic accident cause by a Setanta policyholder?

The situation remains murky. Information available from the Central Bank and other sources initially referred to the Irish Insurance Compensation Fund. Calling on the ICF for all claims involving Setanta would put further pressure on the Fund but also be significantly unfair to injured parties, as it only pays out 65% of a claim or €825,000 (whichever is lower). For example: a claimant for €1.5 million would only get €825,000 from the ICF; a claimant for €100,000 would only get €65,000.

In the aftermath of the news solicitors obviously reviewed their personal injury files for claims against Setanta and, in the case of such claims, look for another source of cover. The prospect of involving the Motor Insurers’ Bureau of Ireland immediately arose. The gut response is that MIBI was set up to cover claims against uninsured or untraced drivers, whereas the ICF was set up to cover insolvent insurers. Surely a claim against Setanta “belongs” with the ICF?

The MIBI agreement is poorly worded at the best of times but in this situation perhaps for the better. The agreement says that if an award which should be covered by an approved policy of insurance is not paid in full within 28 days then, whether or not insurance actually was in place, MIBI will pay it. This interpretation is supported by guidance from Insurance Ireland, the industry body, which says that awards not honoured by Setanta should be referred to MIBI who would pay out and seek to recoup funds in Malta, where Setanta is regulated.

On 1 May 2014, the Minister for Finance stated in the Dáil that

The Motor Insurance Bureau of Ireland [sic] (“MIBI”) have indicated that they intend to accept all third party claims in connection to Setanta policies.

The minister responsible for the agreement with MIBI is the Minister for Transport. The Department of Transport has not had much to say about Setanta to date but the Minister for Transport was asked in the Dáil on 8 May 2014 how MIBI would handle Setanta claims. He responded:

The arrangement MIBI puts in place for dealing with the Setanta claims is a matter for the MIBI itself under the terms of the Agreement. I will arrange for the Deputy’s question to be forwarded to the MIBI for them to respond directly to her.

This does not go so far as confirming that MIBI will, in fact, be covering Setanta claims. The question asked of him is important because when a claim arises from an uninsured driver MIBI is sued alongside the defendant (or as the sole defendant if the driver is untraced), whereas the obligation to pay out on foot of an award which has not been honoured by an insurance company is different. There are likely to be a number of cases where a claimant has already sued the other driver but might now be statute barred as against MIBI, if required to join them. However, in that situation one would assume that MIBI should not necessarily be sued as a co-defendant. But the Law Society advises that claims against Setanta be notified to MIBI in the same manner as uninsured/untraced driver cases. This would involve MIBI being sued alongside the driver.

The Irish Brokers Association got a legal opinion on the situation but really it goes no further than to summarise the ICF and MIBI regimes and state that “recent Dáil comments indicate the MIBI scheme may be available in the context of Setanta.”

What has been the response of MIBI to such notifications? I received my first this morning.

Paul Merceica has recently been appointed as liquidator of [Setanta Insurance] and will be responsible for the administration of the Company’s assets and liabilities … You may also wish to refer to the website of the Malta Financial Services Authority for further information …

This is an update about the liquidation of Setanta Insurance, not about how MIBI will deal with Setanta claims made against it. [As an aside: good luck trying to get a substantive response from the Setanta contact centre.] The only relevant response was as follows:

At this point we cannot confirm our position.

Accordingly, how can it be said with certainty that MIBI will voluntarily meet Setanta third party claims? And who is in charge?

In relation to the wider problem with Setanta, David Murphy has a great post on the RTÉ Business blog which highlights a significant fact:

The Central Bank became aware that there were problems in Setanta late last year, it was still permitted to sell insurance policies until it the end of 2013 and went bust last month.

While a customer of Setanta with the foresight to see the writing on the wall had the option of switching cover before the appointment of a liquidator and getting a refund of part of their policy, someone with a claim against Setanta had whether or not they got their money out largely depend on lucky timing.

Challenging court closures

A few years ago there were concerns, which sometimes resurface, that the Courts Service might close the District Court in Newcastle West and transfer its sittings elsewhere. The only logical venue would be Limerick city, which would raise a number of problems for the Courts Service, lawyers and their clients.

It appears unlikely, at least for now, and in the past year some areas have been added to the Newcastle West district. Court sittings have also been reorganised. Other districts have not been so lucky and have lost out on their local court house.

The West Cork Bar Association has recently been granted leave by the High Court to challenge the closure of the court in Skibereen.

The West Cork District Court area extends from Kinsale westwards as far as Castletownbere. In recent years, there has already been seven local courts closed by the Courts Service in the West Cork area, the most recent being Kinsale District Court which sat for the last time on December 19.

The West Cork Bar Association issued a statement yesterday saying solicitors were concerned court closures were seriously eroding access to justice for people living in the region. The organisation said that if more closures were allowed to proceed, the people of West Cork would face travelling long distances to Cork City to deal with district court matters, when under the Constitution, the State has to provide courts of local and limited jurisdiction.

Solicitors pointed out that vulnerable citizens, who require the urgent assistance of the district court, such as in a domestic violence situation, will find it much more difficult to access the help and protection they need.

I mentioned previously a High Court judgment which dismissed a challenge brought by solicitors in New Ross area against the temporary relocation of court sittings to Ardcavan. The challenge was on public interest grounds and on the basis that the move threatened the applicant’s right to earn a living.

In that case, the Courts Service argued that solicitors do not have locus standi (a legal interest) to challenge the closure. Mr Justice Hedigan rejected that argument:

I accept that as solicitors practising in the relevant area they have a strong interest in the decision sought to be quashed both in their own and their clients interest. The question is fairly posed “if they do not have locus standi – who does?” The fact their interest coincides with the public interest does not, it seems to me, alter anything. In my view, the applicants have the requisite locus standi to challenge the decision made.

However, in the New Ross case the transfer was originally intended to be temporary due to an “urgent need” where the courthouse was “unsafe or otherwise unusable” and therefore the challenge was dismissed. Mr Justice Hedigan’s decision obviously leaves the wider questions open:

is a court closure an attack on the constitutional right of local solicitors to earn a living; and
is a court closure an attack on the constitutional right of citizens to have access to justice?

We might get an answer from Skibereen.

Protecting court proceedings from social media

[Updated 6/2/14] The most high-profile white collar crime trial in the history of the State got underway today. This post in not about that case, but rather the impact of social media on court proceedings and reporting. Previously, when the jury for that trial was being selected and sworn in, Judge Martin Nolan made a number of interesting comments which hint at the impact social media and the internet can have on court proceedings.

[Judge Nolan] told the panel that it is unrealistic to expect them not to have heard of Anglo but said that anyone who has expressed strong views in public should not sit on the jury.

He said that this includes views expressed on the Internet, including Facebook. Judge Nolan said it would be embarrassing for the jurors if it emerged during the trial that they had expressed views on Anglo on such “permanent forums.”

Once the jury had been selected, he warned jurors that they “should not conduct their own investigations into the case or even read up on it. He said he will regard such activity as a breach of the jurors’ oaths.”

The risk that a juror would engage in independent research is not new but it is heightened by social media and the availability of information online. For example, a university lecturer in the UK was jailed for three months in 2012 for researching a defendant online and sharing her findings with the jury.

It is obvious from the comments of Judge Nolan that the Irish judiciary is alert to the risks. With smartphones in every pocket an array of research resources are available to everyone to an extent unimaginable fifteen years ago. The temptation for a juror to google the accused over lunch could be considerable. [In fact, the issue has already arisen: last year a criminal trial in Cork collapsed when the jury foreman informed the judge hearing the case that a juror had learned of information concerned the accused on Facebook and had discussed it with fellow jurors. Judge Ó Donnabháin warned the juror that she could be facing contempt of court proceedings and granted her legal aid in order to engage a solicitor.]

Research by jurors is an issue which the Law Reform Commission has already considered, in their 2013 Report on Jury Service.

The advent of the internet and social media sites, and in particular their ready accessibility through smart phones or Wi-Fi enabled tablets, now provide access to a wide range of materials such as archives of media reports that may have reported on the factual background to a trial, general information on scientific matters that might arise in a trial (such as DNA evidence) and a huge array of general commentary such as blogs and other material from social media. This information can contain prejudicial material, and has the potential to impact on the right to a fair trial. In recent years, trial judges have incorporated specific comments to the jury not to access information regarding the trial through internet search engines or social media.

The Commission recommended that specific reform was needed to deal with juror misconduct in carrying out “extraneous investigations” using the internet and social media. Their report includes a draft Juries Bill 2013 which includes, in section 39, an offence of making inquiries about the accused or any other matters relevant to the trial. “Making an inquiry” is defined as including “conducting any research, for example, by searching an electronic database for information (such as by using the internet), viewing or inspecting any place or object, conducting an experiment or causing someone else to make an inquiry.”

The proposed penalty, however, is a Class B fine on summary conviction – currently a maximum of €4,000. Under the existing law, referred to by Judge Nolan, such research could be a breach of the juror’s oath and result in a finding that they are in contempt of court. Such a finding could lead to a prison sentence, as has happened in the UK. I suspect that the proposal by the LRC is intended to highlight the issue for jurors and while the draft Bill is only a suggestion, one would think that a stronger maximum penalty is warranted.

Inappropriate contact between parties to proceedings is another risk, referred to by Gerry Curran in the Courts Service News in 2012.

Examples of flagrant abuse of this exist [internationally], including the appearance of disparaging remarks about other jurors on social media sites and jurors ‘friending’ each other on Facebook, trying to ‘friend’ counsel for either side and even ‘friending’ defendants in cases they were serving on.

This might appear unlikely to some readers but anyone who has maintained social media accounts for a few years is likely to have received more than one unexpected friend request. Juries already get warnings about discussing cases, but Judges may have to spell things out for jurors. According to Curran:

“[Studies suggest] that the magnitude of social change caused by social media requires the judge to adopt additional specificity when giving instructions. Brand names of social media need to be used as people are so used to using them as an extension of thought. It is also important to emphasis the fair trial element of the instruction – as the same familiarity might well cause a feeling in the juror of giving up a personal freedom in not communicating.

As if the courts don’t have enough on their plate worrying about the conduct of juries, court orders can of course be broken by members of the public. In the UK in 2013 two men received suspended sentences for posting photographs allegedly showing the now-adult killers of James Bulger, in breach of an injunction, on Facebook and Twitter (AG v. Harkins & Liddle [2013] EWHC 1455 (Admin)). That decision shows the relative speed and success with which the UK authorities have kept on top of the issue and no doubt will act as a deterrent in future.

Whatever about jurors, journalists have certainly taken to social media and many provide interesting updates in between various court hearings. [In fact, the Irish Times is liveblogging the Anglo trial.] Curran notes the risks:

Live ‘tweeting’ is akin to broadcast – it is sent with no delay, there is no taking it back, and no limits to dissemination. But what if soon after a courtroom tweet a judge rules something inadmissible, or to be ignored by the jury, or is patently shown to be a lie? In the UK guidelines effectively limit the use of Twitter to accredited media, who apply to do so and who, of course, are familiar with the court process and the consequences of endangering same.

Again, these risks are not necessarily new: a journalist might deliver an update on radio news during a lunchtime broadcast which includes material which might later be ruled on by the presiding judge. Journalists, of course, have expertise in dealing with court reporting and generally are sensitive to what should and should not be reported depending on the stage the case has reached.

Nevertheless, recent developments certainly suggest an aversion to live tweeting or “contemporaneous reporting”. In the high profile surrogacy guardianship case (M.R & Anor v. An tArd Chlaraitheoir & Ors [2013] IEHC 91), the appeal of which is currently being heard by the Supreme Court, Mr Justice Abbott directed that the case be heard otherwise than in public but that certain journalists be allowed to attend and report on the hearings subject to a number of conditions, including that “no contemporaneous social media reporting e.g. by Twitter shall be carried out”. [I am not sure how the Irish Times liveblog of the Anglo trial is maintained but such a blog could constitute contemporaneous social media reporting.]

Similarly, family law proceedings have now been opened up to the media who can report cases so long as the parties are not identified. New guidelines on reporting of such cases prohibit live-tweeting (although the Courts and Civil Law (Miscellaneous Provisions) Act 2013 do not contain the prohibition). Those guidelines appear to have been circulated to judges but not, to my knowledge to date, to lawyers and they don’t appear to be available on the websites of the Minister for Justice or the Courts Service.

As with many areas of the law, it is enforcement rather than any new measures themselves that will be interesting. Recent experience in the UK is of effective detection and prosecution of offences followed by serious penalties. The Anglo trial, which will last for months and be of intense media interest, may provide the first real test for the Irish court system in dealing with these dangers.

Financial Services Ombudsman: a preference for “talk” over rights?

Late last year the Financial Services Ombudsman made some remarkable comments about High Court judgments affecting his office. He acknowledges that powerful agencies should be accountable to the courts, but believes that judicial decisions have been inconsistent and/or incoherent. The tone of the comments is alarming, given that the Ombudsman deals with complaints made by consumers.

The Ombudsman provides a form of binding arbitration which does not impose costs (either up front or as a consequence of losing) and so it is obviously attractive to consumers. However, the sting in the tail is that a decision of the Ombudsman can only be appealed to the High Court, which would otherwise only deal with cases worth more than €75,000.

An appeal from a decision of the Ombudsman must be lodged within 21 days. The Ombudsman’s website helpfully informs visitors that parties wishing to appeal should contact the Central Office of the High Court. Appeals are not simple: they will probably involve complicated issues of fact and law. The complainant may not have had legal or professional advice during the course of the complaint but would reasonably seek at this stage.

The Ombudsman is affronted by the outcome of some of these appeals.

He said findings that he should hold an oral hearing if there was a “conflict of material fact” in a case were “not compatible” with the operation of his office. “If we have to hold an oral hearing in every such case, I hope our political establishment has the intellectual honesty to abolish the office because otherwise it is simply a charade,” he said.

This is a surprising argument: it is not “compatible” with the operation of his office to hold oral hearings, so therefore decisions saying that oral hearings might be necessary are incoherent or, at least, somehow incorrect. When dealing with these appeals the High Court is considering issues of fair procedures and the correct application of the law, not the convenience of a State body. Whether or not the holding of oral hearings is compatible with the Ombudsman’s office is a question for the executive, not the courts.

Mr Prasifka said if the logic of one judgment was followed, “potentially every one of the thousands of decisions made since we have set up is constitutionally challengeable”.

One might think that such a decision suggests that the practice or the law needs changed. Instead, the Ombudsman takes the view that these decisions are “incompatible” with his office and therefore wrong. By contrast, he believes that financial institutions should “learn” from their experience of complaints decided on by his office. He does not appear to consider the possibility of financial institutions taking the view that decisions by his office are “incompatible” with their own business (as, in fact, seems to be the attitude of certain financial institutions).

The Ombudsman, however, appears to betray his true feelings by suggesting that perhaps the Ombudsman system just won’t work in Ireland because “rights are much too important”. This is an extraordinarily dismissive attitude to the rights and interests of complainants. One must wonder what is more important than rights? Perhaps bureaucratic efficiency or satisfying some particular group over the interests of individual rights holders. Bear in mind: the statement was made by the “most powerful office of the ombudsman in the world”.

The Ombudsman was subsequently interviewed on RTÉ’s This Week radio show. First, however, Padraic Kissane was interviewed and discussed his extensive experience of Ombudsman complaints. He said that he had dealt with a number of identical complaints to the Ombudsman that resulted in inconsistent decisions.

[The banks] take the view that they really have nothing to lose by getting a case referred to the Ombudsman because … the win percentages of the Ombudsman for complainants is so low in Ireland, compared to the UK for example, and I have seen and have in my files inconsistent decisions from the Ombudsman’s office relating to the identical terms and conditions of an application and they were both within three months of each other. So it’s the inconsistency of the whole issue.

Mr Kissane refers to the “win percentage” for complainants. The win percentage for financial institutions has gone from 63% in 2009 to was 73% in 2012.

A significant issue for the operation of an office like the Ombudsman is that while it purports to be in the interests of consumers by providing a cost-effective means to pursue a complaint, the reality is that it is pitting those consumers against seasoned professionals. Not only that: consumer complaints are being arbitrated by an office that does not want to be constrained by having to respect the rights of the people who generate the complaints.

This is, in many respects, the contemporary blueprint for justice. The Personal Injuries Assessment Board is another low-cost, modern alternative to courts but one which again encourages individuals to enter a forum, alone, in which they are faced with heavyweight professionals. There are calls for the establishment of a similar body to deal with medical negligence claims. It is popular, if not populist, to essentially seek the removal of lawyers from the equation, but does that protect the interests and rights of citizens? In addition: each time a new dispute resolution forum is established the supposed failings of the courts system remain unaddressed.

One of the consumer’s rights is the right, already referred to, to appeal a finding of the Ombudsman to the High Court. Whether to do so is a serious question. Such an appeal would not be expensive and risky. Many would seek legal advice and services and might not have had those services when first dealing with the complaint. So the complainant and their lawyers have only 21 days in which to weigh up the situation and make a decision.

Given the Ombudsman’s statements about High Court decisions it might not be surprising that he does not appear to be in favour of people taking such appeals.

If anyone thinks that we’re inconsistent they should come and talk to us and in certain cases where people have come to talk to us about this we found that on a closer examination there are actually important differences between the cases and that explained by and large the different result. But look, we always seek to improve our decision making and anyone who has a concern about that is really free to come and talk to us.

I don’t know how available the Ombudsman’s staff are to people who want to “come and talk” but it would seem to be an unhelpful approach to suggest that people who have 21 days in which to decide whether to appeal a decision should first consult the other side in this manner.

Procedural changes to the courts system in the Courts Bill 2013

The Minister for Justice has published the Courts Bill 2013 (explanatory memorandum here) which will change two aspects of how the courts system works in Ireland: (1) reporting of certain cases ordinarily held in private and (2) the monetary jurisdiction of the lower courts.

(1) Relaxation of the rules on private hearings

The changes in the Bill on private hearings will commonly be described as relaxing the in camera rule. In fact, what the Bill does is add to the list of cases which must be heard otherwise than in public but to which bona fide members of the press may attend, so long as nothing which might identify the parties is published. (There is a slight technical difference between cases heard “in camera” and those heard “otherwise than in public”, but it’s not relevant here.) The change will essentially allow for court reporters to publish accounts of family law* proceedings, including applications for domestic violence orders although judges will retain the power to exclude the press in certain circumstances. Interestingly, a judge will have the power to exclude the press from hearing evidence which may contain commercially sensitive information. This provision is likely to be relied on in many family law cases, justifiably or otherwise. The aim is to increase public confidence in the judicial system by partially removing the veil which ordinarily hangs over such cases.

It is somewhat disappointing to see that while the Bill proposes to allow court reporters to attend hearings at which an application for a domestic violence order is made, the Bill does not close off the loophole whereby breach prosecutions can be fully reported. I wrote last October:

if a domestic violence order is breached, a criminal prosecution is brought and held in public. Anyone can attend the hearing and the media can report on it. After years of this unacceptable position being tolerated, it appears that situation will change.

The Department informed me that it was intended to close off the loophole in a Criminal Law (Miscellaneous Provisions) Bill but I do not see why it could not be included in the Courts Bill. I assume that breach prosecutions will be made subject to the new rules in the Courts Bill, so that the press can attend hearings and publish reports so long as they do not identify the parties. Nevertheless, it is hoped that the restriction on reports of breach prosecutions will be introduced soon.

* Family includes, in this context, cases involving civil partners and cohabitants.

(2) Increase in civil jurisdiction of the lower courts

The Bill will increase the jurisdiction of the District Court from the current €6,348.69 to €15,000. Over that amount the Circuit Court will hear cases with a value up to €75,000 (up from €38,092.14), beyond which cases will be dealt with in the High Court. This should have the effect of reducing legal costs: as a rule of thumb, the higher the court the higher the cost and by bringing more cases into the lower courts the costs of those cases will be reduced while the burden of the High Court will also be lessened.

Two things are interesting in this part of the Bill:

The Circuit Court will have jurisdiction in personal injury cases only to a maximum of €60,000. The Minister’s justification is as follows: “As a further measure to deal with concerns relating to possible inflation of awards and a consequent effect on insurance costs, I am proposing to restrict the jurisdiction of the Circuit Court to €60,000 in respect of personal injury actions.” I don’t know what this means other than suggesting that the insurance industry lobbied for the lower limit.
In 2002 the Government changed the law to increase the District Court jurisdiction to €20,000 and the Circuit Court to €100,000 (with no lower personal injury limit specified) (I wrote about it here). The relevant sections of the Courts and Court Officers Act 2002 were never commenced (ie. activated) on the basis that the Government wanted to monitor the impact of the Injuries Board. They are now increasing jurisdiction by only 75% of what was decided on 11 years ago, for reasons unknown.

Nevertheless, the changes are good as the existing limits of the jurisdiction of both lower courts is too low. The greatest impact may be on the District Court which, due to the historic low limit, has tended not to have a significant civil law list. That will now change.

We can’t all access the courts. We should at least have access to court documents.

Seth Barrett Tillman had an excellent oped in yesterday’s Irish Independent on the question of open justice and, in particular, access to documents filed in court by litigants. It is taken for granted in many jurisdictions that journalists and members of the public can see written arguments, allegations and facts submitted by parties in advance of court hearings but, in Ireland, an iron curtain of secrecy protects documents filed.

Why should you care? First, the current position of the Irish courts is inconsistent with modern notions of transparency, access to information, and simple fairness.

It is also inconsistent with prevailing western good governance norms. Judges are government functionaries and filings in lawsuits are, when all is said and done, an effort to lobby them — most frequently by private parties.

The public has every right to know who or what entities are lobbying the judiciary, what factual and legal arguments they are making, and what relief they are seeking.

Second, these submissions often form the basis of hearings, oral arguments, and other trial court or appellate proceedings. But such proceedings are incomprehensible (or nearly so) without advance access to these documents.

A judge will frequently refer to these documents during such proceedings; likewise, attorneys frequently frame their answers by referencing the arguments and factual assertions made in their submissions or those of their opponent.

Although the public can attend all such hearings under the Irish Constitution’s “open courts” provision, the right to “hear” such proceedings is not meaningful without access to the parties’ briefs. This is particularly true in so-called complex litigation, involving multiple parties, multiple issues, and multiple jurisdictions.

Third, competition for legal services is stifled by the lack of public access to these documents. Attorneys who wish to practise in a specialty which is new to them lack access to a library of written filings to use as models.

Tillman is absolutely correct in arguing that the lack of public access to court documents effectively limits public access to the courts and therefore the citizen’s right to see justice being done. In addition, it must obviously make life unnecessarily difficult for journalists who must rely on what is said in court along with whatever information the parties are willing to share. In fact, it is often difficult or impossible to even obtain a copy of a written judgment resulting from court proceedings.

Anyone who has spent time in court will agree with Tillman’s statement that proceedings are incomprehensible without seeing at least some of the case documentation in advance. At a very practical level, it can even be hard to make out what is being said.

Tillman suggests that an amendment providing for greater transparency could be inserted into the Legal Services Regulation Bill. On the basis that no-one knows when that legislation will be passed, I would go one further and suggest that the Government could include it in a Civil Law (Miscellaneous Provisions) Bill before the year is out.