Is The Compensation Culture The Disease In Society Law General Essay

Published Date: 02 Nov 2017

Is the ‘Compensation Culture’ the disease in society or a cure?

HYPOTHESIS

Legislature and judicial law should be deliberated to evaluate and bring together possible reforms for the claim and compensation culture in Britain, as it is expressed to have become a ‘blame and sue’ society which can influence the area of law extremely.

RESEARCH STRATEGY

This essay aims to reflect the impact of the compensation culture on society. The compensation culture labels a society in which it is adequate for anyone who has suffered a personal injury to pursue damages through litigation. I intend to use a socio cultural approach for my research. The socio-cultural approach involves society and culture shape perception. Social customs, beliefs, values, and language play an important role in a person's identity and reality. This will be the most suitable approach as different discussions, critical analysis, advantages and disadvantages of claiming is going to be discussed. I will state the law revolving around this area. I will briefly survey the types of new claims being made contrasting the claims that would not have been countenanced in the past. Some legal and moral problems arising from this act will be brought into light. I will look at how law has addressed this issue and lastly I will express my own views how to tackle the problem of claim culture.

The questions that I am going to investigate in this piece are as follow.

What is the existing law handling the claims and compensation in Britain? Discussing statutes and case law can help to conquer this question.

What really establishes a compensation culture?

Is this a fresh occurrence or has it always existed?

What are supplementary laws to deliberate in regulating the claims and compensation? Laws of different countries can illustrate this very well.

Are there any statistics to see the incline in the claims from the past?

Does the gathered evidence point towards a problem that can be deliberated? Has the problem evolved due to the leniency in law?

Is claiming helping society or is it just easy money? Looking at statistics and comparing the number of claims appearing can analyse this predicament.

What should be done to resolve this problem? This question will form the foundation of the conclusion, illustrating on the theoretical matters in relation to law reform by the judiciary and legislature.

Are there any alternative methods of regulating services and behaviour than the fear of litigation? To access this issue we need to explore other avenues available other than litigation.

Overall this should enable me to conclude whether or not reform of this area is desirable. I can assess any problems governing the law in area. Has claiming gone up compared to cases dealt with in the past?

Literature review

Claims that Britain is in the grip of a ‘compensation culture’ and, consequently, a litigation crises are asserted with increased frequency. Concerns of this kind can be found in the columns of newspapers, in official reports, political discourse, legislative debate, and judicial decisions. To analyse the issue accurately and assess it, it is vital to know the existing law which forms the back bone of claiming.

The existence of claiming for damages comes from Tort law. The idea of tort law is to redress a wrong done to a person, usually by giving them financial damages as compensation. [1] 

The usual action in tort is negligence. The tort of negligence offers a source of action leading to damages, or to relief, in each circumstance intended to guard legal rights, including those of private safety, property. [2] Negligence is a tort which hinges on the existence of a breaking of the duty of care owed by one person to another. The elements in determining the liability for negligence are: [3] 

Duty of care must be owed by plaintiff

There should be a certain breach of that duty

The plaintiff Directly caused the injury [but for the defendant's actions, the plaintiff would not have been hurt with an injury].

The plaintiff suffered Harm as a consequence of that breach

The damage was not too remote, hence there was proximate cause

The case that formed the base of the whole claims and compensation idea was Donahue and Stevenson [4] . This case enlightened the idea of neighbour principle which was beautifully explained by lord Atkin as ‘You must take reasonable care to avoid acts or omissions which you can reasonably foresee would be likely to injure your neighbour, [5] 

There are other vital sources that highlight idea of tort, claiming damages and establishment of entitlement to access the resources.

One of the most important act that can be discussed here is the Compensation Act 2006. It deliberates the possible liability, claiming the costs if experienced any damage and management and regulation of claims. [6] There are further acts such as The Compensation (Regulated Claims Management Services) Order 2006, The Compensation (Claims Management Services) Regulations 2006 and The Compensation (Claims Management Services) (Amendment) Regulations 2008 which can be studied to see any amendments or changes in law. [7] 

There is sufficient legislature to help to outline a framework to abide by while taking decisions in this field of law. However, a lot of case law is there to look up to while handling such situations. The ruling in Donoghue and Stevenson is also mentioned or used in a lot of later cases which has confirmed the success of the ruling in this case. [8] The success of this area can be an aspect of the increasing number of claims in the country. As there is a lot of evidence to look at while assessing the current form of tort law, it can be helpful to assess the weight of advantages and disadvantages of tort law. This can help to evaluate the existing form of the law and any reforms which can be looked at can be revealed.

If we look the benefits of tort law it can be seen that Academics have long acknowledged the status of Tort law and its two primary aids. The first is that it delivers efficient risk management motivations, applying a good standard of behaviour and the discouragement of negligence. In order to evade having to pay compensation, individuals and businesses are stimulated to implement stable risk management. This means that if the price of lessening the risk is less than possible compensation payments, then there is the economic encouragement to shrink that risk. The Civil Justice Resource Council

(2007) debates that Tort Law is crucial as it certifies that individuals or customers have authority and businesses are discouraged from putting earnings ahead of safety. Whilst damages are conventional, cases carried under Tort Law can also produce other penalties, such as the exclusion of dangerous activities. The second significant benefit of Tort Law is that it offers amends for those injured and allows for remedial fairness. Under Tort Law the chief issues of individual accountability and personal responsibility are supported. The basic foundation of individual responsibility is that we tolerate our own damages unless another person is accountable for them [9] . Alongside this line of dispute, personal responsibility can be clear as the responsibility we have to reimburse the damaged party if through our negligence loss is experienced.

At the same time as the existence of Tort Law is undoubtedly essential, there are a amount of matters that stop it working capably and effectively. Fenn et al (2004) shows a number of difficult subjects as, consciousness of the system, prices in claiming, doubt concerning whether a claim will prosper, ambiguity about causation, inconsistency in the sum of compensation, incentives for the hurt parties to reduce their damages, doubt regarding how costs are tolerated and the financial incomes accessible to pay compensation. In relation to the first idea, possible honest claims may not be followed because of deficiency of awareness of the system. Fenn et al (2004) pressure the influence of uncertainty because as a consequence individuals may be reluctant to jeopardise the big costs, in the arrangement of legal fees, and great secondary costs. Even if duty of care is established, negligence and causation must be found which may be hard to prove. Maybe the noticeable issue acknowledged is that even if an individual has a reasonable claim, there are no promises that the defendant will be able to see the compensation sum required. The issues emphasised above can all stop the efficient process of Tort Law. However, insurance can offer a way out, easing many of these problems and significantly guaranteeing that effective claimants obtain the right compensation.

Journal articles bring out interesting factors to consider. There is a lot evidence regarding journal articles about the use of tort law to get compensation for damages.

We can see that In Britain, as in numerous other countries, the law of torts is mainly judge-made. [10] For example, most of tort law's dominant principles, such as those about the duty of care, the standard of the reasonable person, and the ideas of injury and remoteness, are found in the law reports rather than in the statute books. [11] All features associate to the Compensation act in one way or another. When the Bill that became the Compensation Act 2006 (UK) was discussed, it was recommended that provisions demonstrated on the Australian statutes should also be presented into it. [12] However, this unenthusiastic proposal did not come to completion. [13] 

Proposals from Lord Young's report on health and safety laws and the related "compensation culture" highlights suggestions for a basic claims procedure with secure costs for low value personal injury claims. [14] 

There are a lot of strategies and guidelines to take action in bringing forward a claim but we cannot ignore some major aspects. A vital issue here is of cost.

The NHS is usually thought to be fronting this combination of difficulties to a noticeable extent. In a quite short space of time there have been very intense rises in both the amount of claims for medical negligence and their cost. [15] ndjdhehfew

Decreasing lawsuit expenses invades the government’s current liability reform suggestions which is to be estimated at a time when spending on the NHS and its effectiveness are great on the program of all the main political parties. [16] 

Insurers advise that there are other areas of concerns in the liability system, for example, the predicted cost of upcoming asbestos -related claims. [17] 

Additional fact to be noted is case settlements. Settling cases outside court have become quite popular. According to National Health Service Litigation Authority, only three percent of claims reach court. [18] 

Statistics can also help see money going out as result of claims.

Number of Claims Notified since 2000 (Source: CRU)

Year Number

2000/2001 735,931

2001/2002 688,315

2002/2003 706,697

2003/2004 770,243

2004/2005 755,875

able 19: Payments made by the NHSLA for clinical negligence claims 1999

-

2008

Year

Money paid out

2003/2004

£ 422,514,000

2004/2005

£ 502,894,000

2005/2006

£ 560,309,000

2006/2007

£ 579,391,000

2007/2008

£633,325,299

These statistics can be found in NHSLA (2003-2008)

Looking at the statistics it can easily be concluded that number of claims have gone up over the past years. Some steps should be taken to restore the misuse of the law for selfish reasons and greed. he purpose of this paper has been to review the evidence concerning the existence ofa 'compensation culture'. It has not been to evaluate the likely efficacy thenumerous and diverse suggested responses, except to say that we should be carefulto avoid introducing solutions to non-existent or different problems. In this regard, both the Task Force and the Actuaries reports take a wrong turn to the extent that theyfocus on the supposed motivations of some injured claimants, attributing to them greater greed or other moral failings as the source of the problem. t has been persuasively argued that in the United States, the usual exemplar of a compensate on culture out of control, individuals are no more inherently prone to sue than the citizens in other developed societies, and that what has mattered is the extent to which njury settlements have gone up. But there is virtually no reliable evidence about the number of bogus or exaggerated claims or whether they constitute a grave (or increasing) problem. What has been plausibly suggested is that 'some insurance industry commentators rely heavily on anecdotal evidence of a worsening environment in order to justify price increases, quoting individual cases of highly doubtful or speculative claims that cannot be truly representative of claims in general'. [19] 

When Lord Levene, the Chairman of Lloyd's of London, complains that a 'deluge' of claims is 'plundering the economy', [20] we sense that this may not be a totally disinterested assessment.

There are a number of benefits and set backs regarding the law of tort. In some quarters, the number of injury claims has been made to appear as a yardstick to measure the moral (and economic) condition of the country. Are we less tolerant and more litigious? Unfortunately, the available data do not provide a conveniently consistent answer, though on balance it looks as if the British continue to be a nation of 'lumpers' rather than litigators. There is good evidence that some sorts of accident claims have risen (from a relatively low base) and that the overall costs of personal injury settlements have gone up. But there is virtually no reliable evidence about the number of bogus or exaggerated claims or whether they constitute a grave (or increasing) problem. What has been plausibly suggested is that 'some insurance industry commentators rely heavily on anecdotal evidence of a worsening environment in order to justify price increases, quoting individual cases of highly doubtful or speculative claims that cannot be truly representative of claims in general'.

When Lord Levene, the Chairman of Lloyd's of London, complains that a 'deluge' of claims is 'plundering the economy',we sense that this may not be a totally disinterested assessment.

The Task Force analysis seems to be that if we are suffering from a crisis, it is largely one of confidence arising from the misplaced fears of potential defendants and their insurers, rather than from a culture that 'blames and claims' too much. In contrast, in spring 2005 while on the election stump the Prime Minister declared that many public servants (particularly teachers and healthcare workers) were worried that they may 'be subject to unfair legal action' and that ways must be found to 'protect' them from what Mr. Blair called a 'real problem',which serves to remind us that the liability issue, being about the distribution of resources, is broadly political.

Recently, Harlow expressed particular concern about the incidence of claims made against state actors accused of various sorts of regulatory failure, as well as surprise atthe 'culpable' lack of attention paid by policy-makers to the associated compensation issues given the likely impact on public resources and budgets. 'Tort law', she suggests, 'urgently needs a political steer and legislative input'.

This happened in Australia in 2002, and is shortly to be provided in this country by a government bill. [21] 

When evaluating the bill's provisions, the scope and reliability of the evidence will (or at least ought to be critical. Loose talk of a 'compensation culture' no doubt helps to sell the very sorts of newspapers that purport to despise it most: however, we should be cautious before we allow it to dictate the legislative (or judicial) policy-making agenda.