Stay but don’t delay (service) – A potential to strike out stayed portal claims

One of our recent cases has revealed a potential pitfall for claimants who seek to stay lower value claims for injury started in the Ministry of Justice (MoJ) portal for employer and public liability injury claims.  Typically, claimants seek a stay as the expiry of the 3 year limitation period approaches. To do this claimants issue claims using the CPR 8 procedure, effectively starting proceedings to prevent a limitation defence and immediately ask the court to stay the same. 

Often, if a stay is granted, service of court proceedings can take place several years later at which point numerous medical reports are often revealed supporting a significantly increased claim value.  The MoJ portal only accommodates claims of a value up to £25,000 meaning that the claim will have to be transferred to the mainstream county court process which can also have increased costs consequences for insurers. 

In the present case, we identified a procedural deficiency leading to the strike out of the claimant’s case highlighting a danger to claimants who overlook the basics. The circumstances are as follows: 

The claim was submitted to the portal in March 2020 and liability was admitted shortly thereafter. Limitation expired on 28 July 2022. The claimant issued a CPR 8 claim and sought a stay – the date of issue was 29 June 2022. On 25 July 2022 the court granted the stay and ordered that the claimant send a copy of the sealed claim form to the defendant. The order made it clear that sending the claim form to the defendant would not amount to formal service of proceedings – the claim form was sent under those circumstances.

The stay of proceedings was extended multiple times, to 23 July 2024. At this point the parties were at an impasse. The claimant sought a further stay whereas our position was that the matter ought to be progressed by submitting the claim to stage two of the MoJ portal process.

The claimant requested a further stay. No formal application was made. We applied to the court for an order requiring the claimant to submit the claim to stage two. A hearing was listed for December 2024 and just prior to that the claimant made an application to transfer the claim from the low value MoJ process to the County Court proper due to an increase in the value – this application was successful.

The claim was now valued in the region of £300,000 based on newly served medical evidence and a schedule of loss. The court ordered that the claimant was required to serve an amended proceedings by 10 January 2025.

Service

On receipt of proceedings, we noted a sealed CPR 8 claim form (the correct form in MoJ portal proceedings) had been included along with an unsealed amended claim form in respect of the county court action.

When we asked when the sealed CPR 8 claim form had been served it emerged that it had not been. CPR 7.5(1) stipulates that the claimant must complete the service of a sealed claim form before midnight on the calendar day four months after the date of issue. 

The case was stayed to 23 July 2024 delaying the date for service. The latest date for service was 23 November 2024.  

We argued that as the sealed claim form was not served within the CPR 7.5(1) four-month period, the court did not have jurisdiction to hear the claim. We applied to the court for a declaration confirming it did not have jurisdiction to hear the claim and to strike it out.

Our application was successful, and the court struck out the claimant’s case. 

Comment

There is a persistent trend of claimants obtaining stays and then using the time to gather extensive medical evidence in support of a claim with a much higher potential value than the £25,000 portal limit. A lack of transparency in these scenarios makes it difficult, if not impossible, for insurers to manage the case and in particular, their reserves.

Therefore, this result was particularly welcome. It highlights the significant downside to incubating a claim, years past limitation – namely that mistakes can be made in terms of the basics such as service. It appears that, in their focus to gather more medical evidence, the claimant overlooked the fact that the sealed claim form had not been served and did not have an awareness of when service was ultimately due. 

Overlooking service led to the strike out of a liability admitted claim worth approximately £300,000. There is no scope for appeal as the claimant was plainly in breach of the rules. There is also no option to re-issue the claim as it is now significantly outside of limitation.