“….. 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”
“I do not read those passages in the speeches of their Lordships in Pickett's case and Gammell v. Wilson [1981] 2 W.L.R. 248 in which they stress the difficulty of assessing an award of damages for the lost years in the case of a child as having general application to the claims of all children whose earning capacity has been diminished. In attempting to assess the value of a claim for the lost years, the court is faced with a peculiar difficulty. Not only does it have to assess what sum the plaintiff might have been earning, but it also has to make an assessment of the sum that would not have been spent upon the plaintiff's own living expenses and would have, therefore, been available to spend upon his dependants. In the case of a living plaintiff of mature years whose life expectation has been shortened and who has dependants, there are compelling social reasons for awarding a sum of money that he knows will be available for the support of his dependants after his death. It was this consideration that led to the result in Pickett's case. As a consequence of the decision in Pickett's case, the House of Lords in Gammell's case felt compelled to apply the same principle to a claim brought on behalf of the estate of the deceased person. If it could be shown that part of the deceased's income was available to be spent on his dependants, then a claim for that part of the income was available to cover the lost years of working life. In the case of a child, however, there are no dependants, and if a child is dead there can never be any dependants and, if the injuries are catastrophic, equally there will never be any dependants. It is that child that will be dependent. In such circumstances, it seems to me entirely right that the court should refuse to speculate as to whether in the future there might have been dependants for the purpose of providing a fund of money for persons who will in fact never exist. It was this consideration that led me in Kandalla v. British European Airways Corporation [1981] Q.B. 158 to refuse to assess a sum for the lost years in respect of two unmarried doctors by speculating as to whether or not in the future they would have married and set aside some part of their income for husbands or children. I refused to enter into the realm of speculation about an impossible and hypothetical situation. However, when one is considering the case of a gravely injured child who is going to live for many years into adult life, very different considerations apply. There are compelling social reasons why a sum of money should be awarded for his future loss of earnings. The money will be required to care for him. Take the present case; the cost of future nursing care has been assessed upon the basis of nurses coming in to care for him for part of the day and night. It is not a case where damages have been awarded which will provide a sufficient sum for him to go into a residential home and be cared for at all times. Damages awarded for his future loss of earnings will in the future be available to provide a home for him and to feed him and provide for such extra comforts as he can appreciate. It cannot be assumed that his parents will remain able to house, feed and care for him throughout the rest of his life. If, of course, damages have been awarded upon the basis of the full cost of residential care so that they include the cost of roof and board, any award for future loss of earnings will be small because there will be a very large overlap between the two heads of damage. The plaintiff must not be awarded his future living expenses twice over; this would be unfair to the defendants. I would, therefore, award this child a sum to compensate him for his loss of earnings during the period that he will live but I would not award any additional sum to compensate him for the lost years.”
“The correct approach in law to the assessment of damages in these cases presents, my Lords, no difficulty though the assessment itself often will …. The loss is pecuniary. As such, it must be shown, on the facts found, to be at least capable of being estimated. If sufficient facts are established to enable the court to avoid the fancies of speculation even though not enabling it to reach mathematical certainty, the court must make the best estimate it can. In civil litigation it is the balance of probabilities which matters. In the case of a young child, the lost years of earning capacity will ordinarily be so distant that assessment is mere speculation. No estimate being possible, no award — not even a “conventional” award — should ordinarily be made. Even so, there will be exceptions: a child television star, cut short in her prime at the age of five, might have a claim: it would depend on the evidence. A teenage boy or girl, however, as in Gammell's case may well be able to show either actual employment or real prospects, in either of which situations there will be an assessable claim. In the case of a young man already in employment (as was young Mr. Furness), one would expect to find evidence upon which a fair estimate of loss can be made. A man well established in life, like Mr Pickett, will have no difficulty. But in all cases it is a matter of evidence and a reasonable estimate based upon it …. My Lords, the principle has been settled by the speeches in this House in Pickett's case. The loss to the estate is what the deceased would have been likely to have available to save, spend, or distribute after meeting the cost of his living at a standard which his job and career prospects at time of death would suggest he was reasonably likely to achieve. Subtle mathematical calculations based as they must be on events or contingencies of a life which he will not live, are out of place: the judge must make the best estimate based on the known facts and his prospects at the time of death.”
“I am quite satisfied that in this case the court ought not to depart from the normal rule. Croke v Wiseman was decided after the court had been referred to both Pickett and Gammell . It is obvious from the judgments that the members of the court had heard full argument on those decisions. Although I have concluded that the decision is inconsistent with both Pickett and Gammell , I am not prepared to hold that the circumstances in this case are so rare and exceptional that this court is entitled not to follow it. Nor, even if permitted to do so, would I hold that the decision in Croke v Wiseman was manifestly wrong. I accept that this claimant may be reluctant to invest in the cost of an appeal to the House of Lords but in my judgment that is not a sufficiently strong reason to depart from the normal rule. In my view, the error, if error it be, must be corrected by the House of Lords”
“I think he is unlikely to have a permanent relationship or to get married. I would envisage him having close relationships with friends although I would like to think that with the right support he could have an active social life and the opportunity to mix with other people outside the immediate family particularly once he leaves school. It is important that his carers offer him appropriate support and companionship and clearly he is very sociable in school and college environment.”
“For the plaintiff it has been contended, in the first place, that she should receive as additional damages either the whole or some part of the capital cost of acquiring the bungalow, since it was acquired to meet the particular needs arising from the accident. But this argument, in my judgment, has no foundation. The plaintiff still has the capital in question in the form of the bungalow. An alternative argument advanced was, however, that as a result of the particular needs arising from her injuries, the plaintiff has been involved in greater annual expenses of accommodation than she would have incurred if the accident had not happened. In my judgment, this argument is well founded, and I do not think it makes any difference for this purpose whether the matter is considered in terms of a loss of income from the capital expended on the bungalow or in terms of annual mortgage interest which would have been payable if capital to buy the bungalow had not been available. The plaintiff is, in my judgment, entitled to be compensated to the extent that this loss of income or notional outlay by way of mortgage interest exceeds what the cost of her accommodation would have been but for the accident. She would also, in my judgment, have been entitled to claim the expenses of a move to a new home imposed by her condition and the expense of any new items of furniture required because of that condition, but there was no evidence before the judge under either of those headings. As to the increased cost of accommodation, if any, it was, as I have said, agreed that we should make the best estimate we could on the available material, and the matter can only be approached on a broad basis.”
“It seems to us, however, that where the capital asset in respect of which the cost is incurred consists of house property, inflation and risk element are secured by the rising value of such property particularly in desirable residential areas, and thus the rate of 2 per cent. would appear to be more appropriate than that of 7 per cent. or 9.1 per cent., which represents the actual cost of a mortgage loan for such a property. We are reinforced in this view by the fact that in reality in this case the purchase was financed by a capital sum paid on account on behalf of the defendants by way of interim payments, and thus it may be appropriate to consider the annual cost in terms of lost income and investment, since the sum expended on the house would not be available to produce income. A tax-free yield of 2 per cent. in risk-free investment would not be a wholly unacceptable one. Mr. McGregor, for the plaintiff, objects that if a rate of 2 per cent. is adopted then the multiplier of 16 would be far too low and a substantially higher multiplier should be adopted, resulting in much the same anomaly. For our part we would reject this argument, since the object of the calculation is to avoid leaving in the hands of the plaintiff's estate a capital asset not eroded by the passage of time; damages in such cases are notionally intended to be such as will exhaust the fund contemporaneously with the termination of the plaintiff's life expectancy.”
“Damages in cases of this sort are notionally intended to provide a fund which will both meet the claimant's life-time needs and be exhausted contemporaneously with the termination of the claimant's life expectancy. Roberts v Johnstone prescribes that the claimant should, in respect of the cost of accommodation, be compensated for the notional loss of investment income on the capital cost incurred in buying a suitable property. The resulting sum awarded will be wholly insufficient to purchase a property, but the theory is that the shortfall and thus the balance of the actual funds required in order to purchase a suitable property can be found in, or borrowed from, the awards made under other heads of damage such as pain, suffering and loss of amenity, loss of earnings, capitalised awards for therapy and other costs. See generally per Swift J in Whiten v St George's Healthcare NHS Trust[2011] EWHC 2066 QB at paragraph 411. In order to reflect the notional loss of investment income a tax free yield on risk-free investment was assessed at 2% in Roberts v Johnstone, although the rate now conventionally applied in the calculation is 2.5%. The theory here is that where the capital asset in respect of which the cost is incurred consists of residential property, the inflation and risk element are secured by the rising value of such property, particularly in desirable residential areas. When the calculation is concerned with the principal home it is conventional and consistent with the underlying theory to apply the lifetime multiplier appropriate to the claimant's life expectancy. The exercise in which the court is thus engaged is in modern conditions increasingly artificial. The assumption underlying the approach is that the claimant will be able to fund the capital acquisition out of the sums awarded under rubrics other than accommodation. But in modern times residential property prices have increased rapidly while general awards for pain, suffering and loss of amenity have remained at their traditional levels. Whilst Peter is no doubt robbed to pay Paul, it must often be the case that the accommodation assessed by the court as suitable is simply not purchased. A further problem confronts the claimant with immediate and pressing needs but a relatively short life expectancy. The adoption of the appropriate multiplier in his case, when allied to the 2.5% notional return upon investment, will lead to a relatively modest award and a large shortfall between it and the cost of acquiring the property which is acknowledged to be required to meet the claimant's needs during his admittedly short life expectancy. A similar problem confronts the claimant who establishes less than 100% liability in the defendant, as here, where the award is only for 50% of the sums regarded as necessary to meet the Claimant's reasonable needs…….. Whilst the Roberts v Johnstone approach is designed to avoid conferring a windfall upon a claimant's estate, it gives rise to other anomalies. Thus in many instances of adapted accommodation in cases of this sort there is potentially a windfall for the claimant in the event of the death of his parent carers, since he is likely to be left with a home which is larger than necessary for his own requirements……one could mitigate those effects by adopting a different multiplier for that part of the cost which represents the provision of family accommodation over and above that required for the disabled claimant, but there has been little enthusiasm for such a solution.”
“I would normally anticipate costs in the region of£10,000 plus VAT and disbursements in such a year. I am mindful however that this is the first year of deputyship and that it is therefore likely that the deputy and his staff will be required to spend more time than in subsequent years….I would therefore consider£12,000 plus VAT and disbursements to be reasonable in this case.”