Without fail, I have made the inflation argument when making submissions for PSLA. Those who will recall my previous posts will know that I initially had less than 50% success with the argument. Then, it increased with the judiciary being more open to the debate. After 7.5 months, I find that the submission will succeed in some way, shape or form.
I have had to argue against the inflation argument when I appeared as the Defendant. There was an instance when my opponent and I went against each other twice, with me representing the Claimant first, and then representing myself as the Defendant. Unfortunately, the second judge we appeared before did not agree with the inflation argument that the previous judge had accepted when I represented the Claimant.
After having the opportunity to make this argument countless times, I have refined my argument and can anticipate potential counterarguments from the Defendant. Being a part of Quest Legal Advocates’ qualified advocates team is fantastic. We can exchange ideas and discuss each other’s arguments. is really great because we have a WhatsApp group for that.
Here are some points about the argument. These are suitable for any assessment of damages, but I will specify a particular assessment where necessary.
Relying on JC Guidelines reference, rather than Blair v Jaber
I learned early on to prioritize the introduction of the 16th edition of JC Guidelines over Blair v Jaber, which was a non-binding county court decision and therefore easily arguable. The quote I rely on is:-
“For the avoidance of doubt, of course, the guideline figures should be increased by the appropriate index for inflation between editions”
Introduction to the JC Guidelines –
Sixteenth Edition page xiv
Suppose a claim enters Stage 2 negotiations when the 15th edition is active, but by the time it reaches Stage 3 hearings, the 16th edition has replaced it. In that case, the Court will value damages based on the 16th edition. It would never apply the 15th edition retrospectively. This can be argued to be because the value of money (amongst other things) has changed the value of PSLA.
For the same reason, if the JC Guidelines recommend that the Court should increase the figures by the appropriate index for inflation between editions, then the Court ought to.
Recorder Jack’s decision of Blair serves as a helpful example of implementing the JC guidelines, rather than a demonstration of a Court following them. Focusing less on Blair takes the wind out of the Defendant’s sails so to speak:-
Defendant Counsel: “Blair isn’t a binding decision, it is just one county court Judge’s decision and probably the only one the Claimant can find”
Judge: “….but the Claimant is relying on the JC Guidelines that says I ought to increase the damages in line with inflation, rather than the decision of Recorder Jack?”
Not verbatim, but you get the gist.
RPI rather than CPI
I have been meaning to improve my argument on this matter. When questioned by the court why I prefer RPI (which is more beneficial than CPI), my usual response is limited to “…because the JC Guidelines specifically rely on RPI.”
RPI incorporates the cost of living (such as house prices, rental rates, etc.) which tends to make the increase seem larger. It is no longer the official statistic for measuring inflation, which is why Defendants can argue that CPI is probably the more ‘appropriate’ measruement of inflation.
It is difficult to argue that RPI (in isolation from the JC Guideline’s comments) should be used over CPI, but one could argue that RPI will take everything into consideration when considering inflation. One could also argue that general damages should not be linked to the cost of goods and services as the PSLA is to compensate and place a Claimant for their injuries, rather than financial loss.
It was neither a pleaded argument nor evidenced in the Stage 2 Settlement Pack
I will come across this argument quite often at Stage 3 and it is problematic because:-
- The usual rule is that an issue, not raised in the S2SP, should not be allowed in the Stage 3 hearing, and;
- In a Stage 3 hearing, usually, the Claimant will make submissions first with no response opportunity, making it difficult to anticipate the Defendant’s submissions.
To ensure clarity in making the point, it’s important to highlight it without making it too lengthy (as there will be many other points to make). It’s crucial to remind the Court that PSLA is an unspecified sum that needs to be determined by the court itself. The submission should only serve as a reminder to the Court of the JC Guidelines, which suggest the method of assessing damages.
Statutory interest and increasing for inflation are distinctively different
Some have argued against accounting for inflation, claiming statutory interest is sufficient.
I argue that parties can agree on PSLA prior to serving proceedings; statutory interest is only awarded post-service. If statutory interest was interchangeable with accounting for inflation, then it would be permitted pre-issue.
I maintain that, as per the aforementioned point, the Court is supposed to account for inflation (but hasn’t needed to due to a consistent increase in inflation). The statutory interest is to compensate for the delay in payment, not to account for inflation.
Prejudicial for Defendants who are at risk of Part 36 consequences
Part 36 offers made during Stage 3 hearings haven those made during Part 7. However, they are more frequently enforced. This is because there is no discretion involved in these offers, unlike in usual Part 36 offers made during Part 7 claims, which can be refused if it is deemed unjust to accept them.
A Defendant may wish to argue it is unjust to allow part 36 consequences in a part 7 claim because inflation makes it unfair. I have had a Defendant successfully argue, in a Stage 3 claim, that to increase with inflation where there is no discretion, would be unfair.
The Claimant’s argument could be that a new edition of the JC Guidelines may be released and become effective after a Part 36 offer but before the assessment of damages. This is perfectly reasonable and legitimate. The Defendant needs to accept that as time goes by, the possibility of an increase in the value of PSLA could happen.
It’s possible for a Claimant to beat a Part 36 offer in various ways. I remember a time when the discount rate changed significantly, and Part 36 offers concerning claims with future losses became easier to beat. This led to Defendants accepting Part 36 offers without hesitation. A senior solicitor once showed me how a Defendant accepted a Claimant’s Part 36 offer, which exceeded £1m, due to the future loss skyrocketing in value.
Conclusion
These are just the main arguments but you can see how they intertwine. You will note from the progression of my post that the success rate has improved. Interestingly, most Judges will decide not to increase the full 22-23% (which is the current inflation increase). Sometimes this is expressly justified (such as stating that increase is not purely down to inflation) and other times, it is simply increased to account for inflation.
If you do not make the submission when you argue about PSLA, then you are missing out on the opportunity to increase damages.
Information
AJH Advocacy Limited, a Limited Company which is regulated by the Bar Standards Boards (entity number 190758), ceases trading on the 12th January 2026.
From the 12th January 2026 and onwards, Alec Hancock will practice as a Barrister at Magdalen Chambers in Exeter. For instructions on matters on or after 12th January 2026, please contact Magdalen Chambers via clerks@magdalenchambers.co.uk or by telephone on 01392 285 200.