Following the introduction of One Way Cost Shifting under LASPO in 2013, claimants in personal injury claims have assumed that any costs liability they have will be shifted to the defendant regardless of whether their claim is successful or not.

The rationale for QOCS was to provide access to justice for valid claims at proportionate cost and to achieve balance between claimants and defendants following the removal of recoverability of success fees and ATE premiums. Many have interpreted this as eliminating the need for ATE cover for personal injury claims, but has it?

QOCS can be “dis-applied” in other words the protection afforded by QOCS will be lost if a claim is contested for being fraudulent or where the claimant fails to beat a Part 36 offer, especially offers made early before proceedings are issued as rejection and failure to beat an offer still renders the claimant liable to the defendants costs for a personal injury claim.

Whilst it is possible to take out ATE cover at a later stage of the claims process the cost is likely to be considerably higher in line with the risk to the insurer. The current RTA portal process for personal injury cases does not always allow the claimant Solicitor to fully determine the merits of a case. For instance medical reports and potential causation issues are assessed after a claim has been submitted on the portal and a risk of QOCS being dis-applied may exist.

Even with the introduction of QOCS, disbursements fall outside of protection and the risk of non-recovery by the Solicitor should be protected by ATE cover as disbursements can be significant when taking into account court fees, medical report fees, etc.

QOCS can be dis-applied and the consequence of this can create a significant risk for Solicitors as the court has wide powers to order a party to pay costs under S.51(3) Senior Courts Act 1981, particularly when the claimant is unable or fails to pay those costs.

We consider there remains a real need for early ATE cover despite QOCS for personal injury cases.

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