Insurers: sign-up to speedy justice

As first published by Insurance Post on 12th December 2019

Shorter and flexible trial schemes – why aren’t insurers using them more?


The Business Court in England and Wales has now embedded in the High Court procedures shorter and more flexible litigation procedures: the Shorter Trials (STS) and Flexible Trials (FTS) Schemes.

These simplify court and trial processes and brings cases to a swifter trial and judgment, within about a year from the commencement of proceedings. It is something insurers should pay attention to in order to keep costs down and mitigate risk.

The FTS provides a slightly lower level of streamlining applicable to all cases, including focusing on shortening trial lengths by reducing oral evidence and submissions, but the aim of both is to ‘achieve shorter and earlier trials for business related litigation, at a reasonable and proportionate cost’.

I am going to look at the STS as it has the greatest potential benefit to insurers. I handled one of the first STS cases to judgment in the Commercial Court and saw first-hand how costs were saved for both parties’ benefit.

Under the STS, a simplified and abridged pre-action procedure replaces any otherwise applicable pre-action protocols. Crucially, the page length of statements of case, witness statements and expert reports are directed to be limited and disclosure is limited to documents relied upon or specifically requested. A designated judge is assigned to the case to keep continuity at pre-trial hearings and at trial, and applications will, where possible, be dealt with on paper. With trial length restricted to four days, cross-examination may be time restricted. Costs budgeting will not apply unless agreed.

Whether a case is suitable for the STS is at the court’s discretion. Cases involving multiple issues, multiple parties, public procurement issues or fraud/dishonesty allegations are identified as not suitable.

With abridged procedural turnaround times, the court driven target of an issued judgment within a year of issuing proceedings really brakes legal costs.

The courts have already signposted their appetite to support these alternative processes.  In the 2018 case, Excel-Eucan Ltd v. Source Vagabond System Ltd, the defendants argued that the procedure was not suitable given case complexity, disclosure needs and trial length. The court disagreed: the statements of case might suggest complexity, but the real nub of the STS rested on whether the case can properly be heard in no more than four days and whether extensive disclosure and/or witness/expert evidence was needed. Assessing those matters, even recognising the need for five witnesses, the case was not assessed as having sufficient complexity to make the case unsuitable for the STS: the judge concluded that four days was enough to conclude the case.

We do, of course, now have also the disclosure pilot (which started in January 2019). The aims of that focus on seeking to streamline and limit disclosure shares the STS aim of simplifying litigation processes and saving costs. Whilst the disclosure pilot achieves this aim by providing a range of disclosure options, under the STS, key disclosure duties are instead directed to serving a bundle of core documents with their pleadings and make specific requests for any additional disclosure.

The STS offers a wholly different, alternative driver to speedier justice, accompanied by simplified and abridged processes which naturally limits and saves legal costs.

For more information please contact Stephen Netherway, Partner in our Litigation and Dispute Resolution team.

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