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SHOULD I SPEND MORE TIME THINKING ABOUT THE COMPENSATION ACT 2006? The Compensation Act 2006 came into force on 23rd April 2007 and I am wondering if I should spend more time thinking about it. Perhaps some of our readers who are experts in this field will be able to allay my nagging concerns that at sometime in the future a Statutory Instrument will bring this Act firmly into the domain of many of our readers. Whilst doing some other research, the words 'Compensation Act 2006' caught my attention and I took the trouble to read a little of the opening text. It started off with this: 'An Act to specify certain factors that may be taken into account by a court determining a claim in negligence or breach of statutory duty; to make provision about damages for mesothelioma; and to make provision for the regulation of claims management services.' When I saw the word 'mesothelioma', I concluded that it was an Act about claims in respect of tumours associated with exposure to asbestos dust. I briefly remembered back to the midfifties and sixties when I often wandered around the dusty boiler rooms in new construction projects where the operatives were sometimes seen at work insulating all the pipework with mixed-up asbestos based products. That insulation of pipework, after drying out, was then painted in colours according to the use of the pipes. It looked impressive as I measured the work for valuations and final accounts, but no one apparently realized at the time that asbestos dust and products would have such an impact on the industry; and also upon those who used and owned the buildings over the years that followed. As everyone now knows, we used asbestos to a great extent in the construction industry. Anyway, after those initial thoughts, the Compensation Act 2006 started to fade away from my thinking. Nevertheless, the words 'breach', 'negligence' and 'claims' continued to float back into my thoughts and so I decided to look a little closer. I decided to look a little closer, not least because little things tagged-on at the end of paragraphs in Acts of Parliament, coupled with the use of subsequent Statutory Instruments, can often have far reaching effects. Far reaching in the context of being way beyond the original reasons for bringing a Bill before Parliament. For example, in this particular case, the words '... to make provision for the regulation of claims management services' seemed to be potentially wide ranging and worthy of another look. In looking again at the references, I found a mass of documentation which, as one would expect, was available on-line, for example: debates in Parliament, etc., etc.. These documents were so numerous, that I decided to look for some explanatory notes. I found one such document which was a speech by Mark Boleat, the initial Head of Claims Management Regulation. This speech was given to the Claims Standards Council General Meeting on 15 November 2006. Amongst the extensive detail related to the Act, I noted the observation that '... it is currently intended to make it an offence to operate without authorisation from 6 April 2007. This time frame is very short. However, it has the advantage of focussing attention on the issues, maintaining momentum and avoiding the risk that by the time legislation is implemented it is out of date.' ['Interesting,' I thought.] I also noticed Mark Boleat's observation that 'whenever legislation is enacted those who subsequently object to some of its provisions often begin their comments with the words “it was never intended that…”, generally without any substantiation, and often to conceal the fact that they were slow to pick up the implications of the legislation.' ['More interesting,' I thought.] As far as I can see, with my limited research, the present scope of the Act is contained in the Statutory Instrument 2006 No. 3319. By section 4(2)(e) of the Compensation Act 2006, services are regulated if they are (i) of a kind prescribed by order of the Secretary of State, or (ii) provided in cases or circumstances of a kind prescribed by order of the Secretary of State. The Statutory Instrument 2006 No. 3319, in accordance with these provisions, makes the following prescriptions:- The kinds of service are the following (paragraph 2):-
The kinds of claim are the following (paragraph 3):-
As far as I see it, the specified 'kinds of services' in paragraph 2 of the Statutory Instrument are comprehensive and could describe the work of almost anyone involved in any sort of dispute resolution work. In the context of many readers, the role of advising a claimant or potential claimant in relation to his claim or cause of action is fairly normal. The role of investigating, or commissioning the investigation of, the circumstances, merits or foundation of a claim, with a view to the use of the results in pursuing the claim is also normal. The role of representation of a claimant (whether in writing or orally, and regardless of the tribunal, body or person to or before which or whom the representation is made) is not uncommon. The role of referring details of a claim or claimant, or a cause of action or potential claimant, to another person, including a person having the right to conduct litigation is not unusual in so far as many readers may obtain work by acting as consultants to other firms or refer work on to others including lawyers. The aspect of advertising for work is an inevitable role played by someone in the frame of those who undertake such work as prescribed. However, even though the 'kinds of service' are comprehensive, the whole of the Compensation Act 2006 can only be looked at in the context of the 'kinds of claim' as prescribed by the Statutory Instrument. I have no idea how many readers may be active in the 'kinds of claim' which have been prescribed already, but the trigger word of mesothelioma in the opening words of the Act which nearly diverted my attention away from further research seems to be a minor part of the potential scope of the Act. Further, the interesting words of Mark Boleat, 'This time frame [i.e., operating without authorisation from 6 April 2007] is very short. However, it has the advantage of focussing attention on the issues, maintaining momentum and avoiding the risk that by the time legislation is implemented it is out of date.' may be well off the mark in the context of the legislation ever being out of date. It may be the case that this legislation will be thought of as working quite well in bringing all sorts of people within a regulatory framework and the Secretary of State [for whatever department is relevant at the time for such affairs (it was Constitutional Affairs; now it is Ministry of Justice)] may add many more 'kinds of claim' to the list referred to above. I am sure that readers can think of many claims which relat to consumers which could be added to the above list and still be quite compatible with the present range of claims as prescribed. Indeed, I can see no reason why, based upon the Act itself, why 'areas of claim' which are not even compatible with those already prescribed should not be added to the list. For example, 'areas of claim' which are simply added because they are seen to be 'areas of claim' where those people who are actively engaged in the 'kinds of service' as prescribed are considered, for some reason or other, to be sensible targets for registration. However, readers will be comforted to know that the Secretary of State can only make further prescriptions (see section 15(3)(a) of the Act) after consultations with (i) the Office of Fair Trading, and (ii) such other persons as he thinks appropriate. Nevertheless, whatever the case, in prescribed 'areas of claim', if a person is not regulated, that person cannot operate unless specifically exempted from regulation; which exemption, for practical purposes, would not at this time be relevant to many readers who are not legal practitioners. Legal practitioners, e.g., solicitors and barristers, are specifically exempted from the Act owing to their own regulatory framework [see paragraph 4(1)(a)(i) and (4)(2)(a) of the the Compensation (Exemptions) Order 2007 (Statutory Instrument 2007 No. 209)]. Perhaps upon reflection, if they have not already done so, readers should seek to discover more about this Act and, if they share my nagging concerns, they should urge their own professional bodies to seeks exemptions at this early stage. Perhaps the Chartered Institute of Arbitrators is already doing so, but I have not seen any notes so far. As I noted at the beginning of this article, perhaps some of our readers who are experts in this field will allay my nagging concerns by contributing views to this Newsletter. Perhaps, I have simply exposed the danger of my writing something before undertaking more extensive research, but this Newsletter is a forum about all-sharing rather than about being all-knowing. Francis Miller |
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