The publication of the Courts Bill 2013 has revealed that limits to lower court injury compensation settlements will rise for the first time in twenty-two years.
Limits have been applied to how much compensation the lower courts in Ireland are allowed to award in personal injury settlements since the Courts Act of 1991 and, as the law stands at present, the District Court can only make compensation awards up to €6,384, while Circuit Civil Court settlements of personal injury compensation are limited to €38,092. Under the proposed legislation, the limit for lower court injury compensation settlements will increase to €15,000 and €60,000 respectively.
The changes are intended to reduce the burden of legal expenses for individuals and companies involved in court cases by having their cases heard in a lower division of the Irish court system, but whereas many might feel that lower litigation costs will have a positive impact on the cost of insurance premiums, there are those who believe the opposite might be true.
The Department of Justice and Equality investigated the likelihood that lower court injury compensation settlements could increase as the ceilings were raised, and noted that, when the idea was last proposed in 2002, increased limits were not introduced due to concern about “the potential impact on the levels of awards, which could, among other things, lead to consequential increases in insurance costs”.
Dorothea Dowling – Chairperson of the Motor Insurance Advisory Board – has also raised concerns that raising the limits of lower court injury compensation settlements creates an incentive for people to ‘try their luck’ in the lower courts rather than go through the Injuries Board – which has its own established ‘Book of Quantum’ for the assessment of personal injury claims in Ireland. She suggests the changes proposed in the Courts Bill 2013 could see as many as 24,000 extra litigation cases being initiated.
Ms Dowling warned that, when the lower court injury compensation settlement limits were last raised in 1991, insurance companies increased their premiums ahead of the new limits. She fears that there will be a repeat of the events from twenty-two years ago when the Courts Act 2013 is passed into law later this year.