The Civil Liability Bill – as clear as mud…
It’s now been a week since The Civil Liability Bill was published. The hope from many was that the Bill would provide a bit of certainty in terms of the tariffs and the whiplash definition. Seems like the Government really do like to keep us all on our toes - we can probably all agree that the wording of the Bill is somewhat lacklustre from that perspective.
So what do we know, and when can we expect to have that all important certainty? To try and give some clarity in the murky legislative process, we have set out some Q&As below. In addition and in case you missed it last week, you might like to see our estimated timelines for the passage of the Bill which can be found here
1. Why does the legislation refer so heavily to regulations?
The logical explanation is that the Government wants to keep its cards close to its chest; essentially, this allows flexibility from their perspective. Decisions can be delayed until the last possible minute, and parliamentary scrutiny – although still relevant for many of the Bill’s regulations – will not be to quite the same standard as it would have been for primary legislation.
It’s worth noting that the regulations will become law through secondary legislation – this allows the Government the freedom to make changes without having to introduce an entirely new Bill to Parliament (for example to increase or decrease the numbers in the fixed damages tariff)
2. What is the mechanism for the drafting of the regulations? Who writes them and who influences their content?
The regulations will be drafted by the Ministry of Justice’s in-house lawyers following instructions from relevant policy officials. They will be vetted by the Office of the Parliamentary Counsel (a group of government lawyers) who will have drafted the Civil Liability Bill. This last step is essential – it’s basically a safety net to ensure that the regulations do not stray beyond what is allowed in the original legislation.
3. What is the mechanism for changing them and how frequently we can expect this to happen?
Usually, three to five years after a Bill has been passed, the department responsible for an Act – in this case the Ministry of Justice – will review how it has worked in practice and submit an assessment of this to the relevant Commons Select Committee. The Committee will then decide whether it wants to carry out a fuller post-legislative enquiry into the Act.
4. What is the best guess for when we might see some detail?
There is no set time for when the regulations have to be published; this is a decision by the Secretary of State, David Gauke MP. Our hunch is that they will not be published until after the Bill has received Royal Assent – this is generally what has happened in the past in Bills with similar regulations.
5. I’ve seen the Bill refer to the “affirmative resolution procedure” and “negative resolution procedure” for the aforementioned regulations. What are these?
The Bill confirms that the regulations within it will be statutory instruments (SIs). SIs are the most frequently used type of secondary legislation. Each SI must be published with an explanatory note that explains in easily understandable terms what the effect of the Instrument will be.
There are two ways through which a SI becomes law. As is referred to in the Bill, this can be either through the affirmative or the negative resolution procedure. Taking each of these in turn:
- SIs subject to the affirmative procedure must be actively approved by both Houses of Parliament within a specified timeframe, typically 28 or 40 days. They are debated by the House of Commons and House of Lords in committee or in the Chamber, before a decision is made on whether or not to approve it. This is a more onerous process than the negative process outlined below.
- Negative resolution SIs do not require approval by Parliament. They are formally issued to each House and automatically come into force on a fixed date unless an objection is raised within 40 days. A negative resolution SI is debated in the Commons only if there is sufficient opposition to it. Debates on negative SIs in the Lords occur more frequently.
Although the processes vary, with the affirmative procedure putting SIs under more parliamentary scrutiny than the negative resolution procedure, it is worth noting that it is very rare for an SI to be “annulled” - prevented from passing into law - by either House. The House of Commons last annulled a statutory instrument in October 1979, while the House of Lords last annulled one in February 2000.
6. So which process will the regulations under the Civil Liability Bill fall under?
Both. Regulations on the Discount Rate will be subject to the negative procedure – the established procedure for prescribing the Rate “since it was enacted in 1996”.
The whiplash regulations will be subject to the affirmative resolution procedure – the Bill’s explanatory notes state that this is because “they relate to the substantive rights to compensation of victims of tort”.
It is positive to finally see the appearance of the Civil Liability Bill. However, after scrutinising it in detail, it is fair to say that we are not much further forward in terms of what we can expect the new regime to look like, particularly on whiplash. There is a large amount of detail and definition that will be dealt with in the Bill’s supporting regulations.
For the whiplash reforms, it’s also important to remember that there is another complicating factor - the SIs need to dovetail with the necessary changes to the Civil Procedure Rules (CPR). We know that there are discussions ongoing in this respect but these changes will not be confirmed until just prior to or at the implementation stage. There are only two opportunities for CPR changes to take effect – April or October.
It is, after all, the date of implementation which is the key stage. The Government have publicly expressed how keen they are for implementation to take place in April 2019. However, notwithstanding the obvious potential for delays as the Bill passes through Parliament, there seems to be a huge and potentially insurmountable amount of work still to be done on many fronts if this is to be achieved.
Our view is that implementation of the whiplash reforms is likely to be pushed back if the reforms are implemented properly. April 2019 remains possible, but October 2019 is more realistic.
In terms of the discount rate, it’s worth noting that the Lord Chancellor has promised that the review will take place “promptly” after enactment. And although speed hasn’t been the Government’s strong point of late, we should be mindful that there is still the distinct possibility that the review could be complete by the end of June 2019.