Product liability claims worth less than £25,000 should be on Portal

The PL Protocol for Low Value Personal Injury Claims is designed to process claims worth less than and equal to £25,000 on an electronic portal – and claims processed on the portal are subject to very limited fixed legal costs.

In Pearce v MPL Home Limited & Senza Group Limited (17 March 2021), District Judge Vernon provided much needed clarity on whether low-value product liability personal injury claims should be subject to the PL Protocol.

The claimant argued that product liability claims were a complex area of law for which the PL Protocol was not intended to cater. Matters are considered complex if they require extensive disclosure, witness evidence and expert evidence or where the claimant contemplates applying for a group litigation order.

The judge ruled that complexity was not a reason for a claim to fall outside the PL Protocol to begin with as there were clear mechanisms enabling a claim to exit if it became too complex. Therefore, he rejected the assertion that, by its very nature, a product liability claim was too complex to be covered by the PL Protocol.

The second argument advanced by the claimant was that a breach of contract claim falls outside the definition of public liability as stated in the PL Protocol. The judge acknowledged that, if the claim had been brought solely as a breach of contract claim, it would have fallen outside the protocol. In this case, the claimant was a child and there was no evidence she was a party to any contract.

The judge concluded the claim should have been commenced in accordance with the PL Protocol and submitted on the Claims Portal.

Why does this matter?

In a word, costs.

If the PL Protocol did not apply, the claimant would have been entitled to her reasonable and proportionate costs to be assessed on the standard basis. Due to the way these costs are calculated, the amount payable is often several times more than the damages recovered by the claimant.

Fixed costs apply product liability claims covered by the PL protocol and the amount depends on when the claim is disposed of:

• Where the claim settles within the portal and the damages agreed or awarded are less than or equal to £10,000, the claimant is entitled to fixed costs of £1,400 + VAT and disbursements. If the damages are more than or equal to £25,000, the fixed costs are £2,100 + VAT and disbursements.
• Where court proceedings are issued, different levels of costs apply depending on when the case is resolved but even if it is disposed of at trial, the maximum costs payable on a claim worth less than or equal to £10,000 are £6,540 + VAT + and disbursements.

OC comment

Unless there is clear evidence from the outset that the value of the claim exceeds £25,000, you should insist that the claim is subject to the PL Protocol and fixed costs will apply. This should put claimant's solicitors on notice that if their client fails to comply with the PL Protocol, fixed costs will be pursued when costs are considered at the end of the case.

For further information, please contact Breige Murphy.