In the January football transfer window, Andy Carroll made the record books as the most expensive Englishman to be signed by an English club. Liverpool FC paid a massive £35million for the 22 year old who at present is out with a thigh injury and unable to play for his new club.
Paying such big money for an injured player, ‘what if’ Carroll was unable to take to field and was forced to retire without even kicking a ball for his side? It must take a brave person to say “pay the £35m because his injury will heal”, but what if it doesn’t? From a purely hypothetical perspective the football club could have a case against the doctor who made the diagnosis. If the doctor had said that the injury would heal and his future play would not be affected and it turned out to be incorrect they could be liable for misdiagnosis. The club could possibly pursue the doctor for the money paid for the player and even wages paid to the player whilst his injury prevented him from playing.
A similar case that demonstrates this type of legal claim is that of former West-Ham player Dean Ashton who was injured during an England training session in 2006. Ashton was unable to fully recover from the injury to his ankle cutting his football career short. Ashton has just received an undisclosed settlement from the Football Association to compensate him for his forced early retirement following advice from the doctor that if he continued to play he may be unable to walk in the future.
According to a recent article in Insurance Times it also looks like West Ham want to get their share and are “set to issue a writ against the Football Association for £10.5m in compensation for retired England international Dean Ashton.”
ARAG’s After-the-Event legal expenses product Recourse is designed for just such incidences. An ARAG policy will pay disbursements, regardless of whether a case is won or lost, providing they are not recoverable from an opponent, and the opponent’s costs should the claim for damages be lost*. Working in conjunction with a full or discounted conditional fee agreement, the cover applies to various legal issues, including personal injury claims and contractual disputes. Find out more about Recourse.
* Subject to the Terms & Conditions of the policy.
Friday, 18 February 2011
Wednesday, 2 February 2011
Employment Tribunal System Part II
Following from the last blog post on the Employment Tribunal System a consultation paper was released on 27th January which seeks views on a number of proposals which if successfully implemented are intended to address concerns raised by the British Chamber of Commerce by reducing costs and making workplace disputes easier to resolve.
Citing the government’s aim to review employment law in order to make “the UK to be the best place to start and grow a business” the paper set outs a number of proposals that it hopes will “encourage parties to use early dispute resolution”, and if the dispute does go through an employment tribunal to make “cases move more swiftly to conclusion, so as to contain costs for employers, employees and the taxpayer”. (i)
With proposals ranging from “increased awareness of mediation”, to putting forward “legislative proposals to simplify the employment tribunal process” and amending the qualifying period for employees from one year to two before they can bring a claim for unfair dismissal to an employment tribunal, the consultation paper is bound to attract many responses before its April deadline. You can read all of the proposals and background information in the consultation paper online. (ii)
If implemented the proposals could benefit both the employee and employer with improved efficiencies, early resolution and a reduction in cases escalating to employment tribunals. Although there may also be some negative financial implications for unfair dismissal claimants in the form of introducing a fee and for employers in the form of introducing fines if the employer is found to have treated their employee unfairly. Moreover, some proposals could have unforeseen consequences which add costs to the system.
ARAG policyholders will be well-placed to welcome these proposals with 24/7 legal advice, updated downloadable legal documents and the assurance that policy coverage will reflect any future changes to the law.
(i) & (ii): Department for Business, Skills & Innovation and Tribunals Service (2011); Resolving workplace disputes: A consultation January 2011
Citing the government’s aim to review employment law in order to make “the UK to be the best place to start and grow a business” the paper set outs a number of proposals that it hopes will “encourage parties to use early dispute resolution”, and if the dispute does go through an employment tribunal to make “cases move more swiftly to conclusion, so as to contain costs for employers, employees and the taxpayer”. (i)
With proposals ranging from “increased awareness of mediation”, to putting forward “legislative proposals to simplify the employment tribunal process” and amending the qualifying period for employees from one year to two before they can bring a claim for unfair dismissal to an employment tribunal, the consultation paper is bound to attract many responses before its April deadline. You can read all of the proposals and background information in the consultation paper online. (ii)
If implemented the proposals could benefit both the employee and employer with improved efficiencies, early resolution and a reduction in cases escalating to employment tribunals. Although there may also be some negative financial implications for unfair dismissal claimants in the form of introducing a fee and for employers in the form of introducing fines if the employer is found to have treated their employee unfairly. Moreover, some proposals could have unforeseen consequences which add costs to the system.
ARAG policyholders will be well-placed to welcome these proposals with 24/7 legal advice, updated downloadable legal documents and the assurance that policy coverage will reflect any future changes to the law.
(i) & (ii): Department for Business, Skills & Innovation and Tribunals Service (2011); Resolving workplace disputes: A consultation January 2011
Friday, 28 January 2011
Divorce and the proposed Legal Aid cuts
The UK Government, as part of its ongoing cost-cutting measures, is recommending some significant changes to the legal aid system, including a £350m reduction in funding. In November 2010 Justice Secretary Kenneth Clarke presented a proposal in which legal aid (with some exceptions) will be cut for cases such as divorce, welfare benefits, clinical negligence and personal injury.
Speaking to the BBC about these proposals Clarke described how they planned to “introduce a more targeted civil and family scheme which will discourage people from resorting to lawyers whenever they face a problem, and instead encourage them to consider more suitable methods of dispute resolution." (i)
However, others have concerns that the changes and cuts to legal aid may reduce access to justice and affect those who can least afford it.
In the case of divorce, couples may be required to go through mediation, represent themselves or find the money to fund their own divorce under the new proposals. This will obviously cause additional stress in an already upsetting situation.
One solution, should the proposals go through, would be to introduce insurance that covers the cost of divorce. In an interview on the BBC Radio 4 show Moneybox, Tony Buss, ARAG’s Managing Director describes how in Germany divorce insurance is well-established and taken out by people alongside their other legal protection insurances. A married couple will pay a premium of approximately €100 a year which if they decide to divorce (after at least 3 years of marriage) will pay out around €30,000 towards the legal costs involved. (ii)
Another avenue to consider is that of pre- and post-nuptial agreements. These are not yet enforceable by law but with the recent publication of the Law Commission’s consultation on marital property agreements (iii) this may change in the future. Therefore it would surely make sense to introduce an accompanying insurance that would cover the cost of litigation for both spouses in the event of divorce.
So is there a place for this type of cover in the UK? As Buss points out, so far insurance companies have “shied away from providing it because it is not yet socially acceptable.” But with the potential removal of legal aid, prospect of either funding or fighting your own divorce and the possibility of legally-binding pre-nuptial agreements, this cover would certainly provide a good alternative.
You can ‘listen again’ to discussions on this topic and interviews with Tony Buss on Moneybox, Radio 5 Lives’ Breakfast Show (2 hrs 50 mins) and Ted Robbin’s show on BBC Radio Lancashire (52 mins 33 secs).
(i) 15/11/2010 BBC, Legal aid reforms are unveiled by Kenneth Clarke: http://www.bbc.co.uk/news/uk-11741289
(ii) 15/01/2010 BBC Radio 4, Moneybox: http://www.bbc.co.uk/iplayer/console/b00xgr11/Money_Box_15_01_2011
(iii) Law Commission, Marital Property Agreements: A Consultation Paper (2011) http://www.lawcom.gov.uk/marital_property.htm
Speaking to the BBC about these proposals Clarke described how they planned to “introduce a more targeted civil and family scheme which will discourage people from resorting to lawyers whenever they face a problem, and instead encourage them to consider more suitable methods of dispute resolution." (i)
However, others have concerns that the changes and cuts to legal aid may reduce access to justice and affect those who can least afford it.
In the case of divorce, couples may be required to go through mediation, represent themselves or find the money to fund their own divorce under the new proposals. This will obviously cause additional stress in an already upsetting situation.
One solution, should the proposals go through, would be to introduce insurance that covers the cost of divorce. In an interview on the BBC Radio 4 show Moneybox, Tony Buss, ARAG’s Managing Director describes how in Germany divorce insurance is well-established and taken out by people alongside their other legal protection insurances. A married couple will pay a premium of approximately €100 a year which if they decide to divorce (after at least 3 years of marriage) will pay out around €30,000 towards the legal costs involved. (ii)
Another avenue to consider is that of pre- and post-nuptial agreements. These are not yet enforceable by law but with the recent publication of the Law Commission’s consultation on marital property agreements (iii) this may change in the future. Therefore it would surely make sense to introduce an accompanying insurance that would cover the cost of litigation for both spouses in the event of divorce.
So is there a place for this type of cover in the UK? As Buss points out, so far insurance companies have “shied away from providing it because it is not yet socially acceptable.” But with the potential removal of legal aid, prospect of either funding or fighting your own divorce and the possibility of legally-binding pre-nuptial agreements, this cover would certainly provide a good alternative.
You can ‘listen again’ to discussions on this topic and interviews with Tony Buss on Moneybox, Radio 5 Lives’ Breakfast Show (2 hrs 50 mins) and Ted Robbin’s show on BBC Radio Lancashire (52 mins 33 secs).
(i) 15/11/2010 BBC, Legal aid reforms are unveiled by Kenneth Clarke: http://www.bbc.co.uk/news/uk-11741289
(ii) 15/01/2010 BBC Radio 4, Moneybox: http://www.bbc.co.uk/iplayer/console/b00xgr11/Money_Box_15_01_2011
(iii) Law Commission, Marital Property Agreements: A Consultation Paper (2011) http://www.lawcom.gov.uk/marital_property.htm
Tuesday, 25 January 2011
Employment Tribunal System
Following a research paper on Business and the Employment Tribunal System (i) the British Chamber of Commerce issued a press release calling for reforms to the employment tribunal system. According to the press release “the average cost for an employer to defend themselves at tribunal is £8,500”, as compared to an average payout of £5,400 if the employer settles. The problem that this highlights is that employers will be persuaded to settle “even if faced with a spurious claim” because it keeps costs down and is “more convenient to do so”.(ii)
As Dr Adam Marshall, Director of Policy and External Affairs at the BCC, points out in the press release:
“The employment tribunal system is in dire need of reform. Currently, tribunals are too slow and overwhelmingly weighted in favour of the employee - whereas they should be fair for employers and employees alike.”
ARAG’s range of commercial legal expenses insurances provides vital protection which will help to level the playing field so that the employer feels confident fighting unfounded claims at employment tribunals. For instance, Absolute Business Legal responds to a generous range of legal disputes that can arise from your day-to-day business activities, including:
(i) British Chamber of Commerce (2011) Business and the Employment Tribunal System, Abigail Morris
(ii) British Chamber of Commerce (05/01/2011) Press release: BCC calls for reform to employment tribunal system
As Dr Adam Marshall, Director of Policy and External Affairs at the BCC, points out in the press release:
“The employment tribunal system is in dire need of reform. Currently, tribunals are too slow and overwhelmingly weighted in favour of the employee - whereas they should be fair for employers and employees alike.”
ARAG’s range of commercial legal expenses insurances provides vital protection which will help to level the playing field so that the employer feels confident fighting unfounded claims at employment tribunals. For instance, Absolute Business Legal responds to a generous range of legal disputes that can arise from your day-to-day business activities, including:
- employment disputes and compensation awards
- defence of prosecutions
- representation for compliance and regulatory matters
- pursuing claims for property damage nuisance and trespass
- license appeals
- representation for full and aspect tax enquiries
- VAT appeals
(i) British Chamber of Commerce (2011) Business and the Employment Tribunal System, Abigail Morris
(ii) British Chamber of Commerce (05/01/2011) Press release: BCC calls for reform to employment tribunal system
Tuesday, 18 January 2011
Personal Injury Advertising
Lord Young’s recent report Common Sense, Common Safety explored the perceived ‘compensation culture’ in Britain, which encourages a ‘if there’s a blame, there’s a claim’ mentality in which people are led to believe that they can get financial compensation for even the most minor accident. The report suggests that this places unnecessary burdens on businesses and the voluntary sector, making them take ‘an overzealous approach to applying the health and safety regulations’.
The report identifies the advertising conducted by the claims management companies as one of the major contributing factors to this problem. These advertising campaigns often promote the reward of non-refundable inducements, for example:
“We'll pay you £200 immediately after our solicitors approve your claim”
“As soon as we accept your claim, we promise to give you a £150 cash advance”
Under the current regulations of Client Specific Rule 6(b) of the Conduct of Authorised Persons Rules 2007 these inducements are allowed as they are not offered as an ‘immediate cash payment'. Following recommendations in Lord Young’s report, the Ministry of Justice (MoJ) is proposing to change this rule so that inducements of any kind are banned from all stages of the process. The MoJ has issued the Claims Management Regulation Consultation Paper outlining its plans to all claims management companies with all responses due by 10 February 2011.
So do the problems in the current system as laid out in the Common Sense, Common Safety report exist? As with anything they will to an extent but as the Consultation Paper points out “the majority of claims management businesses are not likely to be particularly affected.” Therefore is it right to limit the competitive edge that advertising and incentive strategies bring to the industry? In addition, as the money for inducements is not added to the claims cost but instead paid by the solicitors is there really that much of a problem to be solved?
You can read more in Lord Young’s Report and the MoJ’s Consultation Paper. To find out about legal insurance, visit ARAG’s website.
The report identifies the advertising conducted by the claims management companies as one of the major contributing factors to this problem. These advertising campaigns often promote the reward of non-refundable inducements, for example:
“We'll pay you £200 immediately after our solicitors approve your claim”
“As soon as we accept your claim, we promise to give you a £150 cash advance”
Under the current regulations of Client Specific Rule 6(b) of the Conduct of Authorised Persons Rules 2007 these inducements are allowed as they are not offered as an ‘immediate cash payment'. Following recommendations in Lord Young’s report, the Ministry of Justice (MoJ) is proposing to change this rule so that inducements of any kind are banned from all stages of the process. The MoJ has issued the Claims Management Regulation Consultation Paper outlining its plans to all claims management companies with all responses due by 10 February 2011.
So do the problems in the current system as laid out in the Common Sense, Common Safety report exist? As with anything they will to an extent but as the Consultation Paper points out “the majority of claims management businesses are not likely to be particularly affected.” Therefore is it right to limit the competitive edge that advertising and incentive strategies bring to the industry? In addition, as the money for inducements is not added to the claims cost but instead paid by the solicitors is there really that much of a problem to be solved?
You can read more in Lord Young’s Report and the MoJ’s Consultation Paper. To find out about legal insurance, visit ARAG’s website.
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