Thursday, 25 October 2012

Serious Injuries - The Search for a Governing Principle

A quick look into the courts' approach to the fundamental question of the the right approach to determining damages awards in serious injury cases with some comments on two High Court decisions in the last 18 months: Whiten and AC.


In such cases it is common for the court to be faced with two sets of proposals from the parties' respective experts. The claimant's Occupational Therapist might suggest a particular kind of wheelchair costing £9,000, the defendant's expert a different kind costing £6,000. The claimant's care expert might say that a carer is required to be present ten hours per day, the defendant's care expert advises that the claimant's needs could be met by a carer attending eight hours per day.

The basic restitutionary principle governing damages in tort is well known - the aim being to put the claimant into the position, so far as money can, which he or she would have been in but for the injury caused by the tort. But what are the limits to that? Is there a limit to the amount of money which should be awarded to make even small improvements to the injured claimant's quality of life? And where there are differing proposals to provide restitution to the claimant, both of which meet the reasonable needs of the claimant, how do the courts determine which set of proposals should be adopted?

In Heil-v-Rankin [2001] 2 QB 272 at paragraphs 22, 23 and 27 Lord Woolf in the Court of Appeal held that:

".. the aim of an award of damages for personal injuries is to provide compensation. The principle is that 'full compensation' should be provided. … This principle of 'full compensation' applies to pecuniary and non-pecuniary damages alike. … The compensation must remain fair, reasonable and just. Fair compensation for the injured person. The level must also not result in injustice to the defendant, and it must not be out of accord with what society as a whole would perceive as being reasonable".


Yet in other cases the principle of "full compensation" has been interpreted in a way which has suggested that provided that the court is satisfied that the Claimant's proposals are reasonable then it matters not what the Defendant's proposal is. So in A-v-Powys [2007] EWHC 2996 (QB) Lloyd Jones J held:

"The basis of assessment is the test of reasonableness as stated in Rialis v Mitchell, (Court of Appeal, 6th July 1984) and Sowden v Lodge [2005] 1 WLR 2129. The claimant is entitled to damages to meet her reasonable requirements and reasonable needs arising from her injuries. In deciding what is reasonable it is necessary to consider first whether the provision chosen and claimed is reasonable and not whether, objectively, it is reasonable or whether other provision would be reasonable. Accordingly, if the treatment claimed by the claimant is reasonable it is no answer for the defendant to point to cheaper treatment which is also reasonable. Rialis and Sowden were concerned with the appropriate care regime. However, the principles stated in those cases apply equally to the assessment of damages in respect of aids and equipment. In determining what is required to meet the claimant's reasonable needs it is necessary to make findings as to the nature and extent of the claimant's needs and then to consider whether what is proposed by the claimant is reasonable having regard to those needs. (Massey v Tameside and Glossop Acute Services NHS Trust [2007] EWHC 317 (QB), Teare J. at para. 59; Taylor v Chesworth and MIB [2007] EWHC 1001 (QB) Ramsay J. at para 84.)

So, once the claimant's proposal has been found to be reasonable, the defendant's proposal becomes irrelevant, or so that passage (and later parts of the judgment) would suggest. The question of doing justice to the defendant which was said by Lord Woolf to be relevant, seems marginalised or perhaps even ignored.

Interestingly in Rialis Stephenson LJ said "A judge must resist the temptation to make the wrongdoer pay for the best possible treatment regardless of whether the injured party will in fact receive such treatment or whether it is reasonable for him to receive less expensive treatment."  Thus the subsequent reliance on Rialis to support the approach set out in A-v-Powys is open to challenge.

In two more recent cases, High Court Judges have given different statements of the principle to be applied to such claims.

In Whiten-v-St George's Healthcare NHS Trust [2011] EWHC 2066 (QB) Mrs Justice Swift stated that "The claimant is entitled to damages to meet his reasonable needs arising from his injuries. In considering what is "reasonable", I have had regard to all the relevant circumstances, including the requirement for proportionality as between the cost to the defendant of any individual item and the extent of the benefit which would be derived by the claimant from that item."

The claimant's reasonable needs are to be identified but the damages awarded must take into account the requirement of proportionality (which includes the question of justice to the defendant). Did this judgment, first instance though it was, herald a return to the Heil-v-Rankin approach and away from the the A-v-Powys approach?

Well, in AC-v-Farooq and MIB [2012] EWHC 1484 (QB) King J appeared to revert to the A-v-Powys approach.

"I accept that the Claimant is entitled to damages to meet her reasonable support needs arising from her injury for the rest of her life, and as far as possible to give her the quality of life which she would have had but for the accident. I also accept the proposition that where there are a range of 'reasonable options' to meet the Claimant's needs, the question is not in the first instance whether some other provision is reasonable, but whether the provision chosen or claimed for on behalf of the Claimant is reasonable (see Rialas v Mitchell, The Times 17 July 1984, per Stephenson J at pp 24-6; Sowden v Lodge [2004] EWCA Civ 1370. [2005]1 WLR 2129). "

It might be pointed out that King J used the phrase "in the first instance" as a qualification which might have allowed a second stage consideration of whether some other provision is reasonable. However, his statement of principle does not sit easily with that of Mrs Justice Swift.

Claimant representatives will seek to persuade the court of the Rialis/Massey/Sowden/Powys statement of principle: the claimant and those acting for the claimant are entitled to choose the care, equipment etc which suits him or her. The question for the court is not whether the proposals are in the claimant's best interests. The damages are designed to achieve restitution. If the claimant's reasonable needs are identified and the choices for meeting those needs are reasonable (not excessive) and achieve restitution, then it is no answer for the defendant to point to a cheaper choice, even if that choice is also reasonable. 

Defendant representatives will emphasise the Heil and Whiten approach - there is a balance to be struck and if there are two reasonable proposals then the court should consider whether the additional cost of the claimant's proposal is proportionate to any additional benefit to the claimant from that proposal. Once a reasonable need is identified, there remains a question of the reasonable cost of meeting that need. If there are two beds which each meet the claimant's reasonable needs and one is significantly cheaper than the other, why should the defendant be ordered to pay for the more expensive one?

Whichever approach you prefer, it seems surprising to say the least, that there is no consistent formulation of such a fundamental principle.

Monday, 22 October 2012

Lost Weekend

Do not get ill at the weekend.

New research adds to concerns about consultant cover in the NHS at weekends.

The research was published in the Royal Society of Medicine Journal and showed that weekend hospitalisation was associated with signficantly higher death rates, Dr Andrew Goddard, Royal College of Physicians director of medical workforce, said:

‘This study is further evidence that patients admitted at weekends are more likely to die following admission than patients admitted to hospital during the week. There are many reasons for this, but the two most important are that the patients are more ill and there are fewer doctors available.

‘The Royal College of Physicians has already called for any hospital admitting acutely ill patients to have a consultant physician on-site for at least 12 hours per day, seven days a week.’
It seems that mortality rates are at least 10% higher in NHS hospitals for patients admitted at weekends.

Purely anecdotally (from my own practice) it is clear that there are higher mortality rates at weekends. Moreover, the problem may be understated, because poor service at weekends may affect mortality even for some patients admitted on weekdays. A patient admitted on a Friday night with an acute abdomen may have the most urgent need for adequate care in the early hours of the following Sunday.

Further, from my experience of negligence cases, I would not be surprised if the morbidity rate was also significantly higher both at weekends and as a result of poor weekend cover.

Medical experts in conference often tell me that the standard of service at weekends is not as good as on weekdays. It seems that investigations are not always available and - this is purely my impression - junior staff are reluctant to call out more senior colleagues to see patients.

I am not an NHS manager, but surely one way of reducing the compensation bill for the NHS, and more importantly to protect patients, would be to manage the service on the basis that patients are likely to need the same level of service whenever they come into a hospital.

It would be very interesting to see figures from the NHSLA of what proportion of claims arise from allegations of negligence at weekends. I would expect it to be higher than 2/7ths!

It is no defence to a claim for damages that the acts and omissions claimed to have been negligent were on a Saturday or Sunday. There might in some cases in which a Defendant Trust might argue that as a result of resource restrictions it was not possible to offer the same level of service at a weekend as on a weekday, but if that is so, then the public has a right to know that that is the position.

Afterword:
Following initial publication of this blog it was pointed out to me by twitter that the nature of patient admissions at weekends might increase mortality. It may of course be true that there are far more admissions following heavy drinking or fights at weekends. That may skew the mortality figures upwards. I wonder if also some patients wait until the weekend to go to hospital because they do not want to take time off work, or have to be around for the children during weekdays. But these factors, if they are explanations of higher mortality following weekend admission, would surely mandate even more resources and consultant cover for weekends rather than less.

Wednesday, 10 October 2012

The Penny and the Bun - Simmons -v-Castle Round 2

The Court of Appeal has today (10 October) given a second judgment in Simmons-v-Castle.  It has qualified the introduction of an across the board 10% increase in general damages with effect from 1 April 2013. The uplift will not apply to claimants who had entered CFA's before that date. However, it has rejected the suggestion that the uplift should only ever apply to claimants who are liable to pay their lawyers' success fees.

The Court had previously, without hearing submissions, hijacked a settled quantum appeal to announce a 10% increase in general damages for (i) pain, suffering and loss of amenity arising from personal injury, (ii) nuisance, (iii) defamation and (iv) other torts causing suffering, inconvenience or distress to individuals. The 10% increase was to come into force from 1 April 2013.

The judgment was given because of an understanding or covenant between the judiciary and the government regarding the reforms to civil litigation costs (following the Jackson reforms). The uplift in damages was an important part of the reforms, designed to compensate claimants for having to pay their lawyers' success fees, rather than recovering those fees from the losing party.

The 10% uplift is expressly not about compensating claimants for their injuries. The justification is not to give claimants more appropriate levels of damages for their pain, suffering and loss of amenity, but to give them money to pay their lawyers.

On the application of the Association of British Insurers, the Court agreed to re-open the appeal and to hear submissions. Concerns had been expressed about the fact that the uplift would benefit all claimants, even those who would still be able to claim all their costs, including success fees, from losing parties after 1 April 2013 (because they had entered into CFAs before that date). 

In my view the use of compensation for injury as a means of balancing a reform to costs was wrong in principle and was bound to give rise to injustice. If you adjust the general damages for all claimants then there will be gainers and losers. Some claimants will not have to pay success fees, some (very few) will pay fees which coincidentally match the 10% increase, others will pay fees which exceed the increase. The unattractive alternative is to award different levels of general damages to different claimants according to their liability to pay success fees.

It would have been better to leave general damages out of the costs changes altogether.

Now the Court of Appeal has addressed the submissions of various interest groups within the civil litigation system. It accepted ABI's primary submission that the 10% uplift ought not to apply to claimants who had already entered into a CFA before 1.4.13. It has determined that the conclusion of its original judgment ought to have been:

"Accordingly, we take this opportunity to declare that, with effect from 1 April 2013, the proper level of general damages in all civil claims for (i) pain and suffering, (ii) loss of amenity, (iii) physical inconvenience and discomfort, (iv) social discredit, (v) mental distress, or (vi) loss of society of relatives, will be 10% higher than previously, unless the claimant falls within section 44(6) of LASPO. It therefore follows that, if the action now under appeal had been the subject of a judgment after 1 April 2013, then (unless the claimant had entered into a CFA before that date) the proper award of general damages would be 10% higher than that agreed in this case, namely £22,000 rather than £20,000".

The Court said that to hold othewise would be to give claimants "the penny and the bun".

However, after 1.4.13 many claimants will have the penny (the uplift) and they will have the bun (not having to pay success fees). The Court recognised that this would happen to claimants not funding claims by CFA or who were self represented and accepted it as a price worth paying for the simplicity and overll justice of the reform. However, in my opinion the 10% uplift will be a windfall in most cases because the market will drive out success fees. And if the market does not support claimants paying lawyers out of damages, then the great majority of claimants will have the penny and the bun.
 

Tuesday, 2 October 2012

PPOs for Dying Claimants

Final settlement of a personal injury claim precludes claims under the Fatal Accidents Act should the claimant later die of the injuries caused by the defendant - Thompson-v-Arnold. There are several means of protecting future claims by the dependants of living claimants who have a reduced life expectancy. Where liability is not disputed and death is likely within a short period, interim payments could be agreed or ordered, with final resolution to be determined following the claimant's death. Alternatively, some heads of claim could be determined, with others, including future care or earnings, stayed. When the claimant dies, those stayed claims become the dependency claims of the bereaved relatives. Provisional damages might be claimed - an award of provisional damages does not preclude future claims arising out of the death of the claimant.

In some delay in diagnosing cancer cases which I have handled we have settled the PI claim to include recovery of damages which would be claimed under any future Fatal Accidents Act claim. However, the courts do not have the power to order compensation under the FAA if the Claimant is still alive! Or do they?

Under CPR 41.8(1)(c) a Periodical Payment Order must specify that the claimant's future pecuniary losses are to be paid for the duration of the claimant's life, or such other period as the court orders. It is clear from 41.8(3) that this "other period" could be a period longer than the Claimant's life: "Where the court orders that any part of the award shall continue after the claimant's death for the benefit of the claimant's dependants, the order must also specify the relevant amount and duration of the payments and how each payment is to be made during the year and at what intervals." 41BPD.2(1) confirms that such an order may be made when the dependant would have had a claim if the claimant had died "at the time of the accident" (presumably "accident" includes "injury caused by negligence" in say a clinical negligence claim).

Since PPOs can be stepped (different periodical payments at different stages in the future), it would theoretically be possible to make an order for payment of say £50,000 per annum during the claimant's life and £40,000 per annum to their dependants after the claimant's death until the youngest dependent is, say, 21 years old, or until the surviving spouse dies.

I confess that I have never seen an order to that effect. I would be interested to know if anybody else has (please leave comment below). I wonder whether there has ever been an order or settlement on those terms. But if not, why not?

Many potential problems would need to be addressed in any such order:

 -   Under CPR 41.8(3) a step change in the periodical payment has to be made on a specified date. Since the date of the claimant's death cannot be predicted then presumably it is acceptable to provide for a step change upon the claimant's death whenever that might occur. Thereafter there would have to be changes in payments as the dependency changes (e.g. as each child reaches 21).

-   What if the claimant later dies for some reason other than the negligence of the defendant (e.g run over by a bus the day after the order is made)? Provision would have to be made to ensure that all PPs will cease on the claimant's death where that is due to a reason other than the defendant's negligence.

-   If the date of death is not known, how can the level of dependency be predicted in advance of death? How do you draft the order such that the payments after death are at a level which will fairly reflect the dependency at that time, when you do not know when death will occur or what the financial circumstances of the family will be at that time? Any order would be riddled with conditions: "if the claimant's death should occur between 2018 and 2020, and provided that dependant A is in full time education between those dates, the periodical payments after 2018 shall be ...."

-   To whom are the dependency payments to be made after the claimant's death? FAA awards are usually apportioned. I presume that periodical  payments would have to be apportioned and the order would have to specify the amount to be paid periodically to each dependant, whether the payments are to be made into court, or to a trustee or to the dependant directly.

-   In some cases there may be future dependants who are not yet born at the time of the settlement of the PI case.

-   The tax position needs careful consideration : whilst PPOs during the claimant's lifetime are exempt, the exemption does not continue after their death.


Notwithstanding the potential difficulties with drafting an order of this kind, the great advantages of using a PPO in such cases include:

-   not only protection of the dependants' claims, but resolution of them, together with the claimant's own claims, during the claimant's lifetime, thus giving peace of mind to the dying claimant and his or her family and saving costs.

-   provision for non-financial dependency could be secured - the law as it stands may not support a claim for loss of services in the lost years - Phipps-v-Brooks Dry Cleaning. 

-   a carefully tailored PPO could address and meet all the future uncertainties in a way in which a single lump sum settlement can only do with a broad brush.

I see no reason to avoid PPOs in such cases merely because there are compromises on liability which prevent 100% recovery.  

PPOs could be used in cases where the claimant is likely to die prematurely as a result of the defendant's negligence. They will not suit all cases, but there may be advantages of using them for the purpose of a once and for all resolution of present and future claims, even where damages are not of the highest level.