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Personal Injury Law Journal: September 2012

Peter Houghton considers the consequences of implementing The Jackson Report’s recommendation

Unlike the assessment of damages for loss of future earnings, which has been bedevilled by the publication of Ogden 6 and 7, the task of valuing general damages for pain, suffering and loss of amenity (PSLA damages) – a staple for all personal injury practitioners – has continued undisturbed since Heil v Rankin [2000]. In Simmons v Castle [2012], the Court of Appeal announced an important change to the exercise, of which all PI lawyers should be aware. From 1 April 2013 onwards the proper level of PSLA damages will be 10% higher than previously.

Bill Braithwaite QC examines the problems that can arise with Roberts v Johnstone calculations and potential solutions

There seems to be quite a lot of discussion at the moment about accommodation claims, and the formula we all call Roberts v Johnstone. In my opinion, the basic problem is that the theory behind the case is correct; a claimant should not be over-compensated by giving him the cost of a house that he or she no longer needs when they die. In order to avoid that result, the cost of using the money to buy the house has been the standard solution since 1988. However, the other side of the coin, which is what is prompting all the current discussion, is that it is also unjust to injure a claimant in such a way that he or she needs different, more expensive, accommodation, and then expect them to dig deep into other reserves to find the purchase price (or, worse still, be unable to afford it at all).

Suzanne Farg and Verity Danziger discuss the hurdles to overcome to establish a claim

The method by which the courts assess whether a future event would have occurred, but for the defendant’s negligence, is at the heart of any determination of causation and is often highly relevant to quantum. However, the authorities show a marked difference in the approach taken by the courts, with certain types of cases requiring that causation be proved on balance of probability, while in others an assessment of lost opportunity has been considered more appropriate. Additionally, this lost opportunity approach (lost chance) is proving increasingly important in the quantification of damages for personal injury and, in particular, in respect of lost earnings. This is well illustrated in the recent clinical negligence case of XYZ v Portsmouth Hospitals NHS Trust [2011], in which the claimant was awarded approximately £5.8m for loss of earnings and business opportunity.

A sign of movement in the discount rate saga takes the form of a Consultation Paper, inviting those with an interest in personal injury claims to respond by 23 October 2012. Andrew Sands and Nick Leech analyse the dual approach that the Consultation appears to be taking.

We strongly support the view shared by many others – that the present rate of 2.5% does not reflect (and never really has since it was set by the Lord Chancellor in 2001) the real return available from Index Linked Government Stock (ILGS). The catalyst for the setting of that rate came from the House of Lords case of Wells v Wells [1998], which recognised that recipients of personal injury awards are not ordinary investors, and should not, therefore, be exposed to investment risk in order to obtain a real return on their awards. Real return, of course, means a return net of tax (say 1%), inflation (say 3%) and the costs of investment advice (1.5% per annum). That all adds up to a gross return of about 8%, which is not at all easy to achieve, and is not consistent with a cautious approach to investment risk.

Pannone LLP

Richard Scorer and Malcom Johnson consider insurers’ liability for sexual assaults in a motor vehicle

Could sexual assaults/abuse taking place in a motor vehicle lead to a damages claim that would have to be met by the motor insurers (or in the absence of insurers, the MIB)? This point was recently considered in AXN v Worboys [2012], with the court holding that the motor insurers are not liable.

Paul Jones looks at the latest case concerning Part 36 offers

Of all the provision of the Civil Procedure Rules, CPR 36 has generated more case law than any other. Introduced as a result of the Woolf Report’s avowed intention of encouraging parties to settle matters rather than proceed to trial, it replaced the older regime of payments into court and was intended to create a system whereby both parties were able to make costs protective offers and, therefore, encourage both parties to focus their attention on settlement at the earliest possible stage, with costs as the big stick to ensure compliance. As such, it is used in nearly every personal injury claim and it is not entirely surprising that it has generated so much argument in the courts. The recent Court of Appeal case of SG v Hewitt [2012] is yet another example in this contentious area.

Test for vicarious liability; cumulative approach

In JGE v The Trustees of the Portsmouth Roman Catholic Diocesan Trust [2012], the Court of appeal, by a majority of two to one (Ward and Davis LJJ in the majority, Tomlinson LJ dissenting), held that a diocese may bear vicarious liability for torts committed by a priest appointed by the bishop of the diocese. The court examined various indicators which may cumulatively indicate that a vicarious liability exists. Its decision goes to the very foundations of the policy and principle behind the doctrine of vicarious liability, and will have an impact on relationships far beyond the church.

Matthew Hoe assesses the teething problems that may arise from rolling out the programme nationally

The county court provisional assessment pilot scheme for costs under PD51E ends on 30 September 2012. It applied to cases in which detailed assessment proceedings were commenced after 1 October 2010; the proceedings were in the Leeds, York or Scarborough County Courts, and where the base costs did not exceed £25,000. Most captured cases are personal injury claims. It sprang from a recommendation in Sir Rupert Jackson’s ‘Review of Civil Litigation Costs: Final Report’.