In an effort to tackle the high cost of insurance in Ireland the Government set up a Personal Injuries Assessment Board (PIAB). The PIAB aims to do this by offering a speedy means of finalising personal injury claims (other than medical negligence claims) and by reducing the cost of delivering compensation. Under the scheme all personal injury claims must be referred to PIAB before proceedings can be issued.
PIAB became operational on 1 June 2004 in respect of claims made by employees against their employers. Earlier than anticipated, and with minimal notice, the scheme has now been extended to include motor accident and public liability claims as from 22 July 2004.
The Law Society has advised that those wishing to bring a claim for personal injuries should in the first instance consult a solicitor.
PIAB has no role in determining liability and will not make any findings of fact relating to fault or negligence. Its role is limited to valuing claims and making awards which can be accepted or rejected by the parties. If rejected by either party the claimant is then free to issue proceedings in the normal way. The notification of the claim to PIAB will stop the running of the Statute of Limitations.
The PIAB procedure is straightforward. In the first instance it will liaise with the employer and/or insurance company seeking an admission of liability. Only where there is an admission of liability by an employer or perspective defendant can the PIAB make an assessment. This is done on a "without prejudice" basis and in any subsequent court proceedings liability can be contested. Where there is no admission of liability for the purposes of a PIAB assessment, it will issue a Release Certificate, which will allow the claimant to proceed to court in the normal way.
Assessment of Claims
The assessment of claims is based on written medical and other reports, which are made available to the parties. No oral evidence is given. If a respondent disputes medical evidence, there is provision for an independent expert to be appointed by the PIAB. The assessments by PIAB are based upon a databank of valuations which has been compiled based on court awards. These are understood to be on the generous side so as to encourage acceptance by claimants.
In cases where the PIAB makes an assessment either or both parties may reject the assessment. In the event of an assessment being rejected, a Release Certificate will be issued allowing the claimant a period of 6 months within which to issue court proceedings.
The Statutory Body
PIAB is a statutory body, which came into force under the Personal Injuries Assessment Board Act, 2003, ("PIAB Act"). The PIAB Act has commenced in its entirety since the 22nd July 2004. PIAB, together with the Civil Liability and Courts Act, 2004, ("the 2004 Act") which was brought into effect on the 20th September 2004, have changed practice and procedure in civil actions in Ireland.
PIAB’s function is to assess compensation to be paid to individuals for pain and suffering in respect of personal injury where legal issues are not in dispute. Claimants are also entitled to claim for financial loss arising as a result of personal injury.
The establishment of PIAB was motivated by lobbying on behalf of the business and insurance industries. The insurance industry blamed the high cost of insurance on the legal costs associated with litigation. The government’s ambition was to put in place an organisation to assess the amount of damages a person should receive in respect of injuries, without the necessity of bringing legal proceedings.
Since the establishment of PIAB, Claimants are not entitled to issue court proceedings in civil actions but must apply firstly to PIAB to have their claim assessed. Exceptions to this rule are:-
Discretion not to arrange an Assessment
Under Section 17 of the PIAB Act, PIAB can exercise its discretion not to arrange an assessment and this may occur where:-
The PIAB Application
An application can be made to PIAB in accordance with Section 46 of the PIAB Act. The application is made by way of a Form A, which is available to download from the PIAB website. The form must be returned to PIAB with a fee of €50.00 imposed on the Claimant by PIAB. The Application Form must be accompanied by a Letter of Claim (as specified under Section 8 of the 2004 Act); copies of correspondence relating to the claim; a medical report; and any documentation which PIAB considers relevant.
The official date of the making of an application under Section 11 of the PIAB Act (which is the date on which the clock stops for the Statute of Limitations) is the date on which the fully completed Form A and the information required by PIAB under Section 11 of the Act, is acknowledged in writing as having been received by PIAB.
The Letter of Claim to be Submitted with the PIAB Application
There is interplay between the PIAB Act and the 2004 Act. Under Section 8 of the 2004 Act, a Plaintiff is required in a personal injuries action to serve a notice in writing to the alleged wrongdoer, before the expiration of two months from the date of the cause of action, setting out the nature of the wrong alleged to have been committed by him. If a Plaintiff fails to do this, the court can award cost penalties against the Plaintiff at the trial of the case.
The letter of claim is an important element in the PIAB application process. The Letter of Claim must be submitted when applying to PIAB.
In circumstances where there is more than one Defendant/ Respondent, the Letter of Claim is even more important. In these circumstances the Letter of Claim becomes an "O’Byrne Letter", which addresses the issue of liability as between the Respondents. The O’Byrne letter is similar to the Letter of Claim but must also deal with the following issues:-
The question arises as to whether a court will punish a Claimant/Plaintiff in terms of costs, which it is entitled to do under the 2004 Act, for the Claimant’s failure to serve a Letter of Claim or an appropriate O’Byrne Letter. It is fair to say, most Claimants would not even know that such a letter exists without the advice of a solicitor.
The PIAB Process
Once PIAB acknowledges receipt of Form A and the accompanying documentation, PIAB will notify the Respondent. The Respondent has ninety days from the issue of a formal Section 13 Notice of Application to respond to PIAB in writing, stating that it does not consent to an assessment being made. It will cost a Respondent €850.00 to participate in the PIAB process. If the Respondent does not respond in writing to the notice within ninety days, PIAB will proceed with the assessment as if the Respondent had consented. It is important to note that under Section 16 of the PIAB Act, a Respondent consenting to assessment, or failing to reply to the notification of assessment from PIAB, does not constitute an admission of liability and cannot be used in evidence in a court case.
If the Respondent agrees to an assessment by PIAB, PIAB will assess compensation to be paid to the Claimant for pain and suffering in accordance with the Book of Quantum. There is no oral hearing. The Book of Quantum contains a guideline of injuries and their related values.
PIAB must make the assessment within a period of nine months, which can be extended to fifteen months, and the Claimant and the Respondent are informed of the amount of the assessment after the expiration of that time.
Acceptance and Rejection of the PIAB Assessment
Both the Claimant and Respondent are notified of the assessment by PIAB. If either Claimant or Respondent rejects the assessment then PIAB must issue an authorisation for court proceedings.
The Claimant has twenty eight days to write to PIAB to accept or reject the award, in default of which he/she is deemed to have rejected it and an authorisation for court proceedings must issue.
The Respondent has twenty one days to reject the assessment, in default of which, it is deemed to have accepted the assessment and PIAB will issue an Order to pay against the Respondent, which has the same status as a Court Judgment.
Claimants and Respondents must take into account the existence of other Respondents at the out set of a claim in particular from a costs point of view. For instance situations can arise where PIAB makes an assessment of damages against a participating Respondent and issues an authorisation for proceedings against a non-participating Respondent.
In the above circumstances the Claimant can still issue court proceedings against the nonparticipating Respondents. The issue of costs in court proceedings against the non-participating Respondents would then arise. In this regard the wording of the O’Byrne letter is very important as the Claimant will want to be assured that the participating Respondents will bear responsibility for not releasing the non-participating Respondent at an earlier stage.
A situation could also arise where the participating Respondent only pays a portion of the amount assessed or if the participating Respondent becomes insolvent and does not pay the full amount specified in the Order to pay. In those circumstances the Claimant / Plaintiff can issue court proceedings against the non-participating Respondents in respect of the balance of the award outstanding.
If a participating Respondent accepts an assessment of damages it must take into account that an Order to pay, which operates as if it were a Judgment of court, will be issued against it for the whole amount assessed. If the claimant is paid in full by the participating Respondent this has the legal effect of a satisfaction by one wrongdoer which discharges all other concurrent wrong doers in accordance with the provisions of Section 16 of the Civil Liability Act, 1951.
As a Respondent, if there is any issue between multiple Respondents in relation to liability, it would be unwise to consent to an assessment as it could find itself having to pay the entire amount of the assessment on foot of the Order to pay and the PIAB fee of €850.00, as well as the costs of the Claimant’s court action against the non participating Respondents and potentially the court costs of the other Respondents if they do not succeed in securing an Indemnity from them.
The Statute of Limitations and PIAB
Section 7 of the 2004 Act, reduces the time period under the Statute of Limitations for a person to issue court proceedings in a personal injury case from three to two years from, ‘ the relevant date’. The relevant date is the date of accrual of the cause of action, or the date of knowledge of the person concerned as to the cause of action, whichever occurred later.
Both the submitting of a claim to PIAB and the issuing of an authorisation from PIAB have a significant effect upon the Statute of Limitations.
The date on which a Claimant makes an application to PIAB, is the date the clock stops running under the Statute of Limitations. It is important to note for any claimant whose time for issuing proceedings is close to expiring under the Statute of Limitations that the ‘official date’, of making of an application under Section 11 of the PIAB Act, is the date on which the fully completed Form A is acknowledged in writing, ‘ as having been received by PIAB’. Therefore it must be taken into account that the date on which time stops running under the Statute of Limitations is taken out of the control of the Claimant.
Under Section 50 of the PIAB Act, time starts running under the Statute of Limitations after the expiration of six months from the date of issue of an authorisation from PIAB. PIAB can seek an extension of time in which to deal with claims beyond the period of nine months, for a further six months and therefore, the effect of Section 50 of the Act is to prolong the limitation period by a further six months in those circumstances.
PIAB does not bar claims on the basis that the limitation period has expired but the Respondent only has to refuse to consent to an assessment in such a case and defend the action in court on the basis that it is statute barred.
Part of the motivation behind PIAB is to remove the cost of legal advice from the personal injuries process. Much of the criticism directed at PIAB has been on the basis that it is unjust to Claimants / Plaintiffs to deny them the cost of seeking advice from lawyers.
Section 7 sub section 1 of the PIAB Act specifically states that nothing in the PIAB Act can be read as effecting the right of any person to seek legal advice in respect of his or her claim. Initially PIAB refused to deal with solicitors acting on behalf of Claimants. However this was deemed to be unconstitutional in the case of Declan O’Brien .v. PIAB Ireland and the Attorney General.
With regard to the Claimant being entitled to his or her costs, it seems that it will be a natural progression that the issue of legal costs will be the subject of the next action taken against PIAB as it would seem to follow that if an applicant is entitled to seek legal representation, they are equally entitled to their legal costs if successful in the PIAB process.
Section 12 Applications
There is one area within the PIAB process where solicitors may be entitled to their costs and that is under Section 12 of the PIAB Act. Under Section 12 of the PIAB Act an application may be made to court to have material evidence preserved until such time as PIAB has assessed the claim.
The issue of costs of that application is at the court’s discretion, however it is usual that the costs would follow the successful application. It would be unwise for a Claimant to bring an application, from a costs point of view, without first giving the Respondent an opportunity to either admit liability or undertake to preserve the evidence as this could lead to a situation where the Claimant could be left with the costs of the application where a Respondent subsequently admits liability or disposes of the evidence. In this regard the Letter of Claim or the O’Byrne letter should also deal with the issue of preserving evidence if necessary.
Settlement and Assessment
There is nothing in the PIAB Act which precludes a Claimant or his or her solicitor from settling the claim with any of the Respondents or their insurers at any stage in the PIAB process. Again however, Claimants must take into account that any legal costs associated with the settlement of their claim may be taken from settlement amount in accordance with any agreement entered between the Claimant and his or her solicitor.
The role of PIAB, is to make assessments of compensation without the necessity of legal advice or court proceedings. Whilst it is the Plaintiff’s choice not to seek legal advice, it would appear that any Claimant who does so is putting himself / herself at a disadvantage, especially in circumstances where there is more than one Respondent and where liability is in issue. It is important to bear in mind that liability can be put in issue subsequent to the Respondents participating in an assessment and therefore liability potentially remains in issue in every case until it is settled or determined by the courts.
If Claimants continue to seek legal advice, PIAB has failed in its prerogative to provide a legal cost free system. Claimants are now left having to pay for independent legal advice when ultimately they are successful in their claim. It must also be taken into account that many of the Respondents against whom they are claiming against will have insurers who are specifically advised on all issues concerning PIAB by their legal advisers.
From a Respondent’s point of view, there are also set backs for those who do not have the benefit of independent legal advice, especially where multiple Respondents occur. Also Sections 14 and 30 of the PIAB Act have the effect of creating a legally enforceable liability on the part of the Respondent who does not communicate with PIAB. This has been seen as unfair and potentially unconstitutional, as there would appear to be no appeal mechanism where an award is made against a Respondent
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