The default position under Qualified One-way Costs Shifting (QOCS) for personal injury compensation claimants in Scotland is this.
If your claim succeeds, you will be able to recover legal costs from your opponent, in addition to the compensation agreed as payable or as awarded to you by a court.
Whether you lose any of your compensation to pay a success fee will depend upon the arrangement you have with your solicitor.
If your claim is unsuccessful, QOCS should mean that you DO NOT have pay legal costs to your opponent – even though the normal rule is “loser pays”.
That is what “one-way costs shifting” means. There’s a shift in the usual costs rule in favour of the loser if they are claimant; but not if they are the claimant’s opponents (usually an insurance company).
QOCS arrived in England and Wales (2013) before it came to Scotland (2021).
To some extent, Scotland has been learning from the experience south of the Border.
In 2023, there have been some developments in England and Wales which have watered down the costs protections afforded by QOCS to claimants in that jurisdiction. Some reports in the legal press have described these changes as applying UK-wide, but they do not apply to Scotland.
The “qualified” part of QOCS highlights that there are, nevertheless, exceptions to the costs protections which personal injury claimants enjoy.
The wordings of the QOCS exceptions are different whether you are north or south of the Border.
QOCS only came into force in Scotland from 30 June 2021.
Insurers and their solicitors are desperate to get some case reports from the Scottish courts to illustrate situations where QOCS has been disapplied – I.e. cases where personal injury claimants have failed in their claims and the court has then found the claimant to be responsible to pay some or all of the opponent’s costs – due the behaviour of the claimant or their conduct of the claim.
This was attempted in the case of a female shopper who had tripped over a stack of metal shopping baskets and been injured. When her court action for compensation failed, the opponent argued she should pay their costs because two of three possible exceptions to QOCS applied.
Unreasonable behaviour and an abuse of process?
The opponents argued that (1) the claimant (or her solicitors) had behaved in a “manifestly unreasonable” manner in the litigation which amounted to (2) an “abuse of process”.
The court disagreed, saying these were “high” (I.e. difficult) tests for the opponents to satisfy.
“Manifestly unreasonable” meant “obviously unreasonable”. But this was a case where the court simply preferred one side’s evidence to the others. The claimant’s case had been conducted reasonably. This was not a case where the claimant had no chance – or very little chance – of success.
The allegation of “abuse of process” was a serious one to make against the claimant’s legal representatives.
It was an attack on the claimant’s solicitor’s “professional conduct and actions”.
It could have negative implications for the solicitor concerned, if established – e.g. a finding of professional misconduct leading to the solicitor having their right to practise restricted or them even being struck off.
Insurers will keep trying to get some reported examples of situations where QOCS protection has been extinguished and claimants have had to bear legal costs after all.
Short of that, insurers’ willingness to raise QOCS exceptions points is designed to scare claimants (and their solicitors). It’s to make you give up your claim or make you settle for less compensation.
We are seeing an increasing willingness on the part of insurers and their solicitors to “polarise” cases.
An instance of this is where the insurer does not simply argue that you have failed to prove your occupier’s liability tripping case because the height difference that caused the trip was not sufficiently great (say, well below 2cm) for it to be a foreseeably “dangerous” defect.
Instead, they argue that you have exaggerated the extent of the defect or exaggerated the extent of your injuries – or even invented the accident.
In the first part of that example – i.e. “defect not foreseeably dangerous” – they’re saying your claim fails because the law is not on your side.
In other words, you may have tripped on the defect and fallen and broken your wrist but, if the height difference that constituted the hazard was only 0.5cm (5mm), that’s not a “defect” the law recognises as a dangerous defect.
But notice that there’s no attack on your credibility in that situation. They can accept the accident happened as you state but you lose because the law does not recognise that any legal duty owed to you has been breached.
On the other hand, contrast that with the insurers arguing that you’re deliberately misstating the extent of the defect.
For example, you say it was 3cm of a height difference that caused you to trip and fall – but they say it was only 0.5cm.
Or the insuers allege that you were not in fact injured as a result of the trip and are exaggerating the extent of your injuries.
Or, worse, they accuse you of not tripping at the locus of the accident at all but instead elsewhere (or not tripping anywhere at all).
Any one of these allegations is questioning your credibility and honesty.
In varying degrees, they are attacking your character.
They are raising the stakes.
They are building the foundations of a QOCS exceptions argument.
No one likes to be accused of lying, especially when the accusation is false.
There’s a hassle factor to all personal claims.
For some claimants, their “good name” apparently being on the line may put them off completely – which is exactly the point, from the insurers’ perspective.
To the insurers, you are just a number. If they can scare you off your claim, your number is ‘nil’ and that suits the insurers just fine.
If you end up in this position, we would encourage you to keep your nerve and refuse to be cowed by such allegations.
Your solicitor will be doing their best to amass quality evidence which establishes your version of events with overwhelming power – so that the insurers on the other side of your case decide it is better to reach a reasonable settlement of your case with you rather than fighting it all the way.
Even in the case where you lose your claim after a court hearing, the odds are against the opponent getting your QOCS protection withdrawn.
The tests are difficult for the insurers to satisfy.
The question is not simply: is the claimant likely to lose?
When QOCS came into Scots law for personal injury compensation claims from mid-2021 onwards, it was a major development in rebalancing the negotiating power of claimants and insurers.
There is not as much stress for you in making a personal injury claim if you know you are immune from having costs awarded against you if the claim fails.
But there are exceptions to this immunity and the insurers are going to keep trying to find where the loopholes lie.
There are similiarities between Scotland and the rest of Great Britain in the way QOCS works but the details are going to be different. This is partly because the terminology used for the QOCS exceptions is not alike. It’s also because the rules have recently between changed again in England and Wales.
Your solicitor will be doing their best to make sure that your claimis advanced properly and fully, so that any risk of falling into a QOCS exception is minimised.
Get in touch with us for help
If you have any questions about funding a possible personal injury claim or any aspect of personal injury claimsat all, please feel free to contact us.
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