Hunt (now Severs) (A.P.) (Respondent)
v.
Severs (Appellant)
JUDGMENT
Die Jovis 28° Aprilis 1994
Upon Report from the Appellate Committee to whom was
referred the Cause Hunt (now Severs) against Severs, That the
Committee had heard Counsel as well on Monday the 28th day of
February last as on Tuesday the 1st day of March last upon the
Petition and Appeal of David Severs of Willow End, Chapel Lane,
Long Marston, near Tring, Hertfordshire, praying that the matter
of the Order set forth in the Schedule thereto, namely an Order
of Her Majesty’s Court of Appeal of the 12th day of May 1993,
might be reviewed before Her Majesty the Queen in Her Court of
Parliament and that the said Order might be reversed, varied or
altered or that the Petitioner might have such other relief in
the premises as to Her Majesty the Queen in Her Court of
Parliament might seem meet; as upon the case of Katherine
Elizabeth Hunt (now Severs) lodged in answer to the said Appeal;
and due consideration had this day of what was offered on either
side in this Cause:
It is Ordered and Adjudged, by the Lords Spiritual and
Temporal in the Court of Parliament of Her Majesty the Queen
assembled, That the said Order of Her Majesty’s Court of Appeal
of the 12th day of May 1993 complained of in the said Appeal be,
and the same is hereby, Set Aside and that the Order of Mr.
Latham Q.C. (sitting as a Deputy High Court Judge) of the 15th
day of April 1992 be, and the same is hereby, so Varied that the
amount of damages be reduced by £89,936: And it is further
Ordered. That the Respondent do pay or cause to be paid to the
said Appellant the Costs incurred by him in the Court of Appeal
and in respect of the said Appeal to this House, the total amount
thereof not to exceed £20,000 and the amount of such Costs in
this House to be certified by the Clerk of the Parliaments if not
agreed between the parties: And it is also further Ordered. That
the costs of the Respondent be taxed in accordance with the Legal
Aid Act 1988: And it is also further Ordered. That the Cause be,
and the same is hereby, remitted back to the Queen’s Bench
Division of the High Court of Justice to do therein as shall be
just and consistent with this Judgment.
Cler: Parliamentor:
Judgment: 28 April 1994
HOUSE OF LORDS
HUNT (NOW SEVERS) (A.P.)
(RESPONDENT)
v.
SEVERS
(APPELLANT)
Lord Keith
Lord Bridge of Harwich
Lord Jauncey of Tullichettle
Lord Browne-Wilkinson
Lord Nolan
LORD KEITH OF KINKEL
My Lords,
For the reasons given in the speech prepared by my noble and learned
friend, Lord Bridge of Harwich, which I have read in draft and with which
I agree, I would allow this appeal and make the order he proposes.
LORD BRIDGE OF HARWICH
My Lords,
A plaintiff who establishes a claim for damages for personal injury is
entitled in English law to recover as part of those damages the reasonable
value of services rendered to him gratuitously by a relative or friend in the
provision of nursing care or domestic assistance of the kind rendered
necessary by the injuries the plaintiff has suffered. The major issue which
arises for determination in this appeal is whether the law will sustain such a
claim in respect of gratuitous services in the case where the voluntary carer
is the tortfeasor himself.
The plaintiff was gravely injured on 14 September 1985 in a road
accident in France when she was riding on the pillion of a motorcycle driven
by the defendant. She was then 22 years of age. The defendant’s liability in
negligence has never been in dispute. The plaintiffs injuries caused
paraplegia and unhappily she suffered many complications. The two doctors
called by the plaintiff and the defendant at the trial agreed that, in terms of
complications, she was the worst paraplegic case they had come across. She
spent long periods in various hospitals, but whenever she was not in hospital
– 1 –
she and the defendant were living together and in November 1990 they were
married.
The action was tried in April 1992 by Mr. David Latham Q.C., sitting
as a deputy judge of the Queen’s Bench Division. He delivered judgment on
15 April 1992 awarding the plaintiff a total sum of £617,004 made up as
follows:
-
General damages for pain and suffering and loss of amenity
90,000
Special damages
90,094
Future loss 412,104
Interest on general damages
6,588
Interest on special damages
18,218
—————
£617,004
Included in the award of special damages was a sum of £4,429 representing
the defendant’s travelling expenses incurred in visiting the plaintiff while she
was in hospital and a sum of £17,000 representing the value of the past
services rendered by the defendant in caring for the plaintiff when she was at
home. Included in the award for future loss was a sum of £60,000
representing the estimated value of the services which would be rendered by
the defendant in caring for the plaintiff in future. The basis on which the
judge approached the assessment of the several elements which went to make
up the plaintiff’s estimated future loss, subject to a number of detailed
adjustments which it is unnecessary for present purposes to examine, was to
apply a multiplier of 14 to the estimated future annual losses.
The defendant appealed against the inclusion in the award of the sums
in respect of the defendant’s travelling expenses and care for the plaintiff.
The plaintiff cross-appealed on various grounds. The Court of Appeal (Sir
Thomas Bingham M.R., Staughton and Waite L.JJ.), in a reserved judgment
delivered on 12 May 1993 [1993] Q.B. 815, dismissed the defendant’s appeal
and allowed the plaintiffs cross appeal to the extent of substituting 15 for 14
as the appropriate multiplier to be used in calculating future loss which, taking
account of the detailed adjustments referred to, had the effect of increasing the
total award of damages by £20,013.
The defendant now appeals by leave of the Court of Appeal to your
Lordships’ House. Three issues arise for decision. The first relates to the
award in respect of the defendant’s travelling expenses, the second to that in
respect of his past and future care of the plaintiff, the third to the Court of
Appeal’s increase in the judge’s award. The first two issues are theoretically
– 2 –
distinct, but I propose to address them together. There is no dispute that the
defendant’s visits to the plaintiff in hospital made a valuable and important
contribution to her general well-being and were calculated to assist her
recovery from the devastating consequences of the accident. But for the fact
that the defendant was himself the tortfeasor, the propriety of the award under
this head would be no more open to question than the award for his services
as a voluntary carer. Accordingly, it seems to me that both these issues must
depend upon the same considerations of principle. The third issue is, of
course, quite distinct and I will consider it later.
The trial judge said of the claims now in dispute:
“It is said that these sums are irrecoverable, that they represent in
effect a benefit to the defendant himself, that in so far as they reflect
a loss on the plaintiff’s part it has been made good by the defendant so
that there is in truth no loss, and that if the incidence of insurance is
put on one side it can be seen that the claim is misconceived.
However, in my judgment this ignores the basis upon which the claim
is made. It is merely a notional monetary figure placed on the true
nature of the loss for which she is entitled to compensation. This loss
is the need she now has by reason of the accident for care and support
which she did not have before. This follows from the analysis of the
legal basis of such claims by Megaw L.J. in Donnelly v. Joyce [1974]
1 Q.B. 454 at p. 462. The valuation of this need remains a difficult
exercise. In Housecraft v. Burnett [1986] 1 All ER 332, O’Connor
L.J. made it clear that when provided by unpaid carers there remains
a value to be placed on it. In my view that remains so whether
provided by the tortfeasor or not. He may give his care and response
to the need, but that does not make good the loss, otherwise there will
be no sustainable claim in any case where the need has apparently been
‘met’ by unpaid carers.”
In the Court of Appeal the judgment of Megaw L.J. in Donnelly v.
Joyce [1974] QB 454 again provided the main foundation for the court’s
reasoning. Having examined this and other authorities, Sir Thomas Bingham
M.R., delivering the judgment of the court, expressed their conclusion, at
[1993] Q.B. 831, as follows:
“Where services are voluntarily rendered by a tortfeasor in caring for
the plaintiff from motives of affection or duty they should in our
opinion be regarded as in the same category as services rendered
voluntarily by a third party, or charitable gifts, or insurance payments.
They are adventitious benefits, which for policy reasons are not to be
regarded as diminishing the plaintiff’s loss. On the facts of the present
case the judge’s decision was not in our view contrary to principle or
authority and it was fortified by what we regard as compelling
considerations of public policy. We consider that he reached the right
conclusion and would accordingly dismiss the defendant’s appeal.”
– 3 –
The starting point for any inquiry into the measure of damages which
an injured plaintiff is entitled to recover is the recognition that damages in the
tort of negligence are purely compensatory. He should recover from the
tortfeasor no more and no less than he has lost. Difficult questions may arise
when the plaintiff’s injuries attract benefits from third parties. According to
their nature these may or may not be taken into account as reducing the
tortfeasor’s liability. The two well-established categories of receipt which are
to be ignored in assessing damages are the fruits of insurance which the
plaintiff himself has provided against the contingency causing his injuries
(which may or may not lead to a claim by the insurer as subrogated to the
rights of the plaintiff) and the fruits of the benevolence of third panics
motivated by sympathy for the plaintiff’s misfortune. The policy
considerations which underlie these two apparent exceptions to the rule against
double recovery are, I think, well understood: see, for example, Parry v.
Cleaver [1970] AC 1, 14 and Hussain v. New Taplow Paper Mills Ltd.
[1988] A.C. 514, 528. But I find it difficult to see what considerations of
public policy can justify a requirement that the tortfeasor himself should
compensate the plaintiff twice over for the self same loss. If the loss in
question is a direct pecuniary loss (e.g. loss of wages), Hussain’s case is clear
authority that the defendant employer, as the tortfeasor who makes good the
loss either voluntarily or contractually, thereby mitigates his liability in
damages pro tanto. The Court of Appeal, in the judgment appealed from,
readily accepted a number of examples advanced in argument for the appellant
defendant as showing that a tortfeasor may mitigate his liability by making
good in kind the physical damage which his tort has caused to the plaintiffs
property. In a wide-ranging argument before your Lordships, where many
hypothetical examples were examined of gratuitous services rendered by a
tortfeasor to an injured plaintiff in satisfaction of a need occasioned by his
ton, Mr. McGregor, for the respondent plaintiff, was constrained to accept
as a general rule that the tortfeasor, having provided those services, cannot
also be held liable to the plaintiff in damages for their value. But he
submitted that where the tortfeasor is a relative or close friend of the plaintiff
and gratuitously provides services of an intimate personal or domestic
character, he is required by law, as a narrow exception to the general rule,
also to pay the plaintiff the value of those services.
The law with respect to the services of a third party who provides
voluntary care for a tortiously injured plaintiff has developed somewhat
erratically in England. The voluntary carer has no cause of action of his own
against the tortfeasor. The justice of allowing the injured plaintiff to recover
the value of the services so that he may recompense the voluntary carer has
been generally recognised, but there has been difficulty in articulating a
consistent juridical principle to justify this result.
In Roach v. Yates [1938] 1 K.B. 256 the injured plaintiff needed to be
cared for day and night and his wife and sister-in-law both gave up their
employment to provide that care for him and together lost wages of £3 a
week. A claim for the value of their services at £3 a week was included in
– 4 –
the special damages claimed and a similar claim made as an element in
general damages related to future loss. The services were given voluntarily
but the plaintiff was held entitled to recover in respect of them. Referring to
the nursing services required by the plaintiff, Greer L.J. said, at p. 263:
“He can get those services, and perhaps get them better than in any
other way, from the attendance which is being given to him by his
wife and his sister-in-law; but he would naturally feel that he ought
to compensate them for what they have lost by giving up the work at
which they were earning the sum of £3 a week. I think that Mr.
Beyfus was right in saying that we must take into account, at any rate
for the period during which the plaintiff may now be expected to live,
the sum of £3 a week as the minimum expense which the plaintiff
would have to incur in retaining the nursing services of his wife and
his sister-in-law.”
In Schneider v. Eisovitch [1960] 2 Q.B. 430, the plaintiff and her
husband were involved in a road accident in France in which the plaintiff was
injured and the husband killed. The plaintiffs brother-in-law and his wife
voluntarily flew out to France to assist the plaintiff back to England and to
arrange the return of the husband’s body for burial. The plaintiff claimed
their expenses as part of her damages. Paull J. said with respect to this claim,
at p. 440:
“Before such a sum can be recovered the plaintiff must show first that
the services rendered were reasonably necessary as a consequence of
the tortfeasor’s tort; secondly, that the out-of-pocket expenses of the
friend or friends who rendered these services are reasonable, bearing
in mind all the circumstances including whether expenses would have
been incurred had the friend or friends not assisted; and, thirdly, that
the plaintiff undertakes to pay the sum awarded to the friend or
friends.”
In the event Paull J. held that these conditions were satisfied and that the
plaintiff was entitled to recover.
In Wattson v. Port of London Authority [1969] 1 Lloyd’s Rep. 95, the
plaintiffs wife had for a period given up her work and consequently lost
earnings in order to look after her injured husband. Megaw J. held that the
wife’s loss was properly included in the husband’s damages. Referring to the
fact that there had been no contract between husband and wife with respect to
her services in caring for him, Megaw J. said, at p. 102:
“That is not how human beings work and it would, in my judgment –
and I say this because I think it ought to be said – be a blot on the law
if the law were to be such that a wife who in these circumstances had
held her husband to make a contract to repay her he should recover
damages for that amount; but if she behaves like an ordinary decent
– 5 –
human being and does not put construction upon the act of that
service, there is financial disadvantage to the plaintiff as a result. In
my judgment, this position is covered in substance in the judgment of
Mr. Justice Paull in the case of Schneider v. Eisovitch [1960] 2 Q.B.
430. The essence of the judgment appears at p. 440, and in this case
I do not think it matters that there is no firm undertaking on the part
of the plaintiff that if he is awarded this sum … he will repay that
money to his wife.”
In the cases of Cunningham v. Harrison [1973] Q.B. 942 and Donnelly
v. Joyce [1974] QB 454 judgments were delivered by different divisions of
the Court of Appeal on successive days. In Cunningham the wife of a
severely disabled plaintiff, who had initially looked after him, had died before
the trial. Lord Denning M.R. said, at pp. 951-952:
“Before dealing with [the claim for future nursing expenses] I would
like to consider what the position would have been if the wife had not
died and had continued to look after her husband, as she had been
doing. The plaintiff’s advisers seem to have thought that a husband
could not claim for the nursing services rendered by a wife unless the
husband was legally bound to pay her for them. So, on their advice
on July 11, 1972, an agreement was signed whereby the husband
agreed to pay his wife £2,000 per annum in respect of her nursing
services. We were told that such advice is often given by counsel in
such cases as these when advising on evidence. I know the reason
why such advice is given. It is because it has been said in some cases
that a plaintiff can only recover for services rendered to him when he
was legally liable to pay for them: see for instance Kirkham v.
Boughey [1958] 2 Q.B. 338, 342 and Janney v. Gentry (1966) 110 S.J.
408. But, I think that view is much too narrow. It seems to me that
when a husband is grievously injured – and is entitled to damages –
then it is only right and just that, if his wife renders services to him.
instead of a nurse, he should recover compensation for the value of the
services that his wife has rendered. It should not be necessary to draw
up a legal agreement for them. On recovering such an amount, the
husband should hold it on trust for her and pay it over to her. She
cannot herself sue the wrongdoer … but she has rendered services
necessitated by the wrong-doing, and should be compensated for it.
If she had given up paid work to look after him, he would clearly have
been entitled to recover on her behalf; because the family income
would have dropped by so much: see Wattson v. Port of London
Authority [1969] 1 Lloyd’s Rep. 95, 102, per Megaw J. Even though
she had not been doing paid work but only domestic duties in the
house, nevertheless all extra attendance on him certainly calls for
compensation.”
– 6 –
In Donnelly v. Joyce, the injured plaintiff was a boy of six. His
mother gave up her work for a period to provide necessary care for him and
the disputed item in his claim related to the mother’s loss of wages. The
judgment of the court delivered by Megaw L.J. contains a lengthy review of
the authorities, but the key passage relied on by the trial judge and the Court
of Appeal in the instant case is at [1974] Q.B. 461-462 and reads as follows:
“We do not agree with the proposition, inherent in Mr. Hamilton’s
submission, that the plaintiff’s claim, in circumstances such as the
present, is properly to be regarded as being, to use his phrase, “in
relation to someone else’s loss,” merely because someone else has
provided to, or for the benefit of, the plaintiff – the injured person –
the money, or the services to be valued as money, to provide for needs
of the plaintiff directly caused by the defendant’s wrongdoing. The
loss is the plaintiffs loss. The question from what source the
plaintiffs needs have been met, the question who has paid the money
or given the services, the question whether or not the plaintiff is or is
not under a legal or moral liability to repay, are, so far as the
defendant and his liability are concerned, all irrelevant. The plaintiffs
loss, to take this present case, is not the expenditure of money to buy
the special boots or to pay for the nursing attention. His loss is the
existence of the need for those special boots or for those nursing
services, the value of which for purposes of damages – for the purpose
of the ascertainment of the amount of his loss – is the proper and
reasonable cost of supplying those needs. That, in our judgment, is
the key to the problem. So far as the defendant is concerned, the loss
is not someone else’s loss. It is the plaintiffs loss.
“Hence it does not matter, so far as the defendant’s liability to the
plaintiff is concerned, whether the needs have been supplied by the
plaintiff out of his own pocket or by a charitable contribution to him
from some other person whom we shall call the ‘provider’; it does not
matter, for that purpose, whether the plaintiff has a legal liability,
absolute or conditional, to repay to the provider what he has received,
because of the general law or because of some private agreement
between himself and the provider; it does not matter whether he has
a moral obligation, however ascertained or defined, so to do. The
question of legal liability to reimburse the provider may be very
relevant to the question of the legal right of the provider to recover
from the plaintiff. That may depend on the nature of the liability
imposed by the general law or the particular agreement. But it is not
a matter which affects the right of the plaintiff against the wrongdoer.”
With respect, I do not find this reasoning convincing. I accept that the
basis of a plaintiffs claim for damages may consist in his need for services
but I cannot accept that the question from what source that need has been met
is irrelevant. If an injured plaintiff is treated in hospital as a private patient
he is entitled to recover the cost of that treatment. But if he receives free
– 7 –
treatment under the National Health Service, his need has been met without
cost to him and he cannot claim the cost of the treatment from the tortfeasor.
So it cannot, I think, be right to say that in all cases the plaintiffs loss is “for
the purpose of damages … the proper and reasonable cost of supplying [his]
needs”.
In Scotland the law on this subject has developed differently. In
Edgar v. Postmaster General 1965 S.L.T. 158 it was held by a majority of the
Inner House of the Court of Session that the injured pursuer’s averment that
his accident had caused his wife to give up work to look after him and thereby
lose wages was irrelevant. Having pointed out that the wife, not being a party
to the action, could not recover the loss, the Lord President (Lord Clyde)
continued at p. 160:
“If, on the other hand, the averment is intended to form the basis for
a claim for domestic assistance for which the pursuer would have had
to pay if he had not been able to secure it gratuitously the claim is, in
my opinion, an irrelevant one. It would have been another matter
altogether if the pursuer had actually paid some third party, or had
entered into a contract to pay some third party for this domestic
assistance. It could then have formed a relevant item in his claim for
damages. But if the assistance which he got was given gratuitously
and there is no undertaking or understanding by him to pay for it (and
that is the situation in the present case) then I am quite unable to see
how he can claim to be reimbursed for a payment he has not and
cannot be compelled to make. In Scotland, damages necessarily
involves a loss either actual or prospective, and the plain fact of the
matter is that the pursuer has sustained no such loss at all in regard to
this item.”
The difference in this regard between Scottish and English law was
examined by the Scottish Law Commission in their report in 1978 (Scot. Law
Com. No. 51). In paragraph 20 they adopted the view that “the value of the
services of persons who have assisted the injured person should be recoverable
by the latter in his action against the wrongdoer” but considered that “the
principle should only apply as between members of the injured person’s family
group or circle”. In paragraph 22 they criticised the reasoning used in the
judgment of Megaw L.J. in Donnelly v. Joyce in the following terms:
“In cases where services have been rendered gratuitously to an injured
person, it is artificial to regard that person as having suffered a net
loss in the events which happened. The loss is in fact sustained by the
person rendering the services, a point vividly illustrated in cases where
he has lost earnings in the course of rendering those services. We
suggest, therefore, that it is wrong in principle, in cases where
services have been rendered gratuitously by another to an injured
person, to regard the latter as having in fact suffered a net loss.”
– 8 –
They concluded at paragraph 23:
“… that it would be right to devise an approach which will enable
the injured person to recover in his own action the value of services
which have been rendered to him by relatives but which would, at the
same time, enable the relative to recover, if he so wished, the value
of these services from the injured person.”
The Commission’s recommendations in this respect were implemented
by Part II of the Administration of Justice Act 1982, which applies to damages
for personal injuries in Scotland and which by section 8 provides:
“8-(l) Where necessary services have been rendered to the injured
person by a relative in consequence of the injuries in question, then,
unless the relative has expressly agreed in the knowledge that an action
for damages has been raised or is in contemplation that no payment
should be made in respect of those services, the responsible person
shall be liable to pay to the injured person by way of damages such
sum as represents reasonable remuneration for those services and
repayment of reasonable expenses incurred in connection therewith.
“(2) The relative shall have no direct right of action in delict against
the responsible person in respect of the services or expenses referred
to in this section, but the injured person shall be under an obligation
to account to the relative for any damages recovered from the
responsible person under this section.”
An elaborate definition of “relative” in section 13(1), which I need not here
set out, implements the Commission’s recommendation that this provision
should apply only if the person rendering the services and the injured person
belong to the same “family group or circle”.
Thus, in both England and Scotland the law now ensures that an
injured plaintiff may recover the reasonable value of gratuitous services
rendered to him by way of voluntary care by a member of his family.
Differences between the English common law route and the Scottish statutory
route to this conclusion are, I think, rarely likely to be of practical
importance, since in most cases the sum recovered will simply go to swell the
family income. But it is nevertheless important to recognise that the
underlying rationale of the English law, as all the cases before Donnelly
demonstrate, is to enable the voluntary carer to receive proper recompense for
his or her services and I would think it appropriate for the House to take the
opportunity so far as possible to bring the law of the two countries into accord
by adopting the view of Lord Denning M.R. in Cunningham v. Harrison that
in England the injured plaintiff who recovers damages under this head should
hold them on trust for the voluntary carer.
– 9 –
By concentrating on the plaintiff’s need and the plaintiffs loss as the
basis of an award in respect of voluntary care received by the plaintiff, the
reasoning in Donnelly diverts attention from the award’s central objective of
compensating the voluntary carer. Once this is recognised it becomes evident
that there can be no ground in public policy or otherwise for requiring the
tortfeasor to pay to the plaintiff, in respect of the services which he himself
has rendered, a sum of money which the plaintiff must then repay to him. If
the present case had been brought in Scotland and the claim in respect of the
tortfeasor’s services made in reliance on section 8 of the Administration of
Justice Act 1982, it would have been immediately obvious that such a claim
was not sustainable.
The case for the respondent plaintiff was argued in the Court of Appeal
without reference to the circumstance that the defendant’s liability was covered
by insurance. But before your Lordships Mr. McGregor, recognising the
difficulty of formulating any principle of public policy which could justify
recovery against the tortfeasor who has to pay out of his own pocket,
advanced the bold proposition that such a policy could be founded on the
liability of insurers to meet the claim. Exploration of the implications of this
proposition in argument revealed the many difficulties which it encounters.
But I do not think it necessary to examine these in detail. The short answer,
in my judgment, to Mr. McGregor’s contention is that its acceptance would
represent a novel and radical departure in the law of a kind which only the
legislature may properly effect. At common law the circumstance that a
defendant is contractually indemnified by a third party against a particular
legal liability can have no relevance whatever to the measure of that liability.
I add a short postscript with reference to a number of Australian
authorities which were helpfully drawn to your Lordships’ attention. The
decision of the High Court of Australia in Griffiths v. Kerkemeyer (1977) 139
C.L.R. 161, adopts in substance what I may call the principle of Donnelly v.
Joyce. Since then there has been a significant number of Australian decisions,
both reported and unreported, rejecting claims by injured plaintiffs to recover
the value of gratuitous services rendered to them by defendants. The reported
decisions to this effect by single judges are: Gowling v. Mercantile Mutual
Insurance Co. Ltd. and Gowling [1980] 24 S.A.S.R. 321; Jones v. Jones
[1982] Tas.R. 282; Gutkin v. Gutkin [1983] 2 Qd.R. 764; and Maan v.
Westbrook [1988] 2 Qd.R. 267. To the like effect are the decisions of the
Full Court of the Supreme Court of Western Australia in Snape v. Reid (1984)
Aust. Torts Reports, 80-620; and of the Full Court of the Supreme Court of
Tasmania in Motor Accidents Insurance Board v. Pulford (1993) Aust. Torts
Reports, 81-235. The only contrary decision is that of the Court of Appeal
of New South Wales in Lynch v. Lynch [1991] 25 N.S.W.L.R. 411. In this
case the Court’s reasoning was expressly related to the circumstance that the
claim arose out of an accident which was the subject of a particular statutory
compulsory insurance scheme. I do not think it would be helpful to encumber
this opinion with a detailed examination of the case. I am content to say that
– 10 –
I agree with the criticism of the decision by the Full Court of the Supreme
Court of Tasmania in Motor Accidents Insurance Board v. Pulford, who
declined to follow it.
I turn to the separate issue relating to the appropriate multiplier to be
applied in relation to the several elements of the plaintiff’s future loss. Both
doctors who gave evidence at the trial estimated the plaintiff’s expectation of
life at 25 years. It is clear from the relevant passages of their evidence that
these estimates were related solely to the plaintiff’s medical condition and that
there was no suggestion that the doctors had approached the problem
actuarially or assessed the effect of other contingencies on the plaintiffs life
expectancy. The trial judge said:
“For the future, the first question is the appropriate multiplier. With
an expectation of life of 25 years from today the right multiplier is, in
my judgement, 14. This is slightly lower than the 14.82 which is
produced from the 4.5 per cent. discount table, but is in line with what
has to be described as a spread of multipliers to be gleaned from the
decisions recorded in Kemp & Kemp. This will therefore be the
appropriate multiplier for all those items in respect of which life
expectancy is relevant.”
The table that the judge is referring to is that showing the present value of a
payment of £1 per annum for 25 years discounted at 4 1/2 per cent. as
£14.82821.
In the Court of Appeal the argument for the plaintiff that the multiplier
should be increased from 14 to 15 was based largely on the table which
appears in Kemp & Kemp vol. 1, p. 8028, headed “Multipliers for loss of
earnings to pension age 60 (Females)” with the subheading “Multiplier
calculated with allowance for population mortality and rate of interest of”
followed by a number of columns headed with different interest rates. The
column applicable to a rate of interest of 4 1/2 per cent. shows the appropriate
multiplier for a woman aged 35 at date of trial as 14.8. Referring to the
Kemp & Kemp tables, of which this is one, the Court of Appeal said at [1993]
Q.B. 841:
“They contain, as the heading shows, ‘allowance for population
mortality.’ In other words, as it seems to us, there may be some
allowance for the contingency that the beneficiary of future payments
may not live long enough to receive them. Such an allowance is not
appropriate in the present case, where the agreed life expectancy of the
plaintiff is 25 years. That is a fact, or rather an agreed assumption,
upon which the damages payable for future care must be based. The
Kemp & Kemp table could be too favourable to the defendant, if used
for that purpose.
– 11 –
“What we need is a simple arithmetical calculation of the present value
of future payments. Counsel have provided us with a table. It shows
that the present value of £1 per annum payable for the next 25 years,
discounted at 4.5 per cent., is £14.82821. That is very little different
from the figure in the Kemp & Kemp table, which shows that the
allowance for mortality must be very small. It would suggest a
multiplier of 15. Accordingly we think it right to substitute the
multiplier of 15 which Mr. McGregor contends for in the calculation
of future costs of care.”
Subject to the same adjustments as had been made by the trial judge, the
Court of Appeal applied the same reasoning to increase the multiplier in
relation to future loss of earnings.
The assessment of damages is not and never can be an exact science.
There are too many imponderables. For this reason, the courts have been
traditionally mistrustful of reliance on actuarial tables as the primary basis of
calculation, approving their use only as a check on assessments arrived at by
the familiar conventional methods; see, for example, Taylor v. O’Connor
[1971] A.C. 115, per Lord Pearson at p. 140E-H. We are told by counsel
that the practice has changed in recent years and that actuarial tables tend to
figure more prominently in the evidence on which courts rely. This may well
be so. But before a judge’s assessment of the appropriate multiplier for future
loss, which he has arrived at by the conventional method of assessment and
which is not attacked as being wrong in principle, can properly be adjusted by
an appellate court by reference to actuarial calculations, it is essential, in my
judgment, that the particular calculation relied on should be precisely in point
and should be seen as demonstrably giving a more accurate assessment than
the figure used by the judge.
The passage I have cited from the judgment of the Court of Appeal
appears to show the court as treating the circumstance that both doctors in
evidence estimated the plaintiff’s expectation of life at 25 years as establishing
the “fact” or “assumption” that she would live for 25 years and thus
converting the process of assessing future loss into “a simple arithmetical
calculation.” I cannot think that this was a correct approach to the evidence.
A man or woman in normal health, at a given age, no doubt has an
ascertainable statistical life expectancy. But in using such a figure as the basis
for assessment of damages with respect to future losses, some discount in
respect of life’s manifold contingencies is invariably made. Moreover, when
the Court of Appeal referred to the Kemp & Kemp table as showing “that the
allowance for mortality must be very small,” they were not making an
appropriate comparison of like with like. The figure of 14.8 taken from the
Kemp & Kemp table refers, as already indicated, to a woman of 35 with an
average expectation of life. From the Life Table, also set out in Kemp &
Kemp, we see that this expectation is 44.6 years. Thus the fact that only a
small allowance for mortality is approprate in relation to the average woman’s
expectation of survival from the age of 35 to the age of 60 cannot be a
– 12 –
reliable guide to the allowance for mortality appropriate to a severely injured
woman aged 29 with a total expectation of life estimated by doctors as no
more than 25 years.
I can find no fault in the trial judge’s decision to take a multiplier of
14 and apply it, subject to the various adjustments he made, in arriving at his
award for both the future cost of care and the future loss of earnings. The use
of a discount rate of 41/2 per cent. was not and is not disputed. The judge had
due regard to the full present value of £1 per annum for 25 years discounted
at that rate, but decided, as I think rightly, to take a slightly lower figure
which he found to be in line with a spread of multipliers in comparable cases.
I do not, with respect, think that the reasoning of the Court of Appeal entitled
them to substitute a multiplier of 15 by rounding up the figure taken from the
discount table.
I would accordingly allow the appeal, set aside the Court of Appeal’s
order and vary the trial judge’s order by reducing the principal award by
£81,429 and reducing the award of interest on special damages by so much as
represents interest on the sum of £21,429 included in the principal award. In
all the circumstances I would think it appropriate that there should be no order
for costs in the Court of Appeal or before your Lordships’ House.
LORD JAUNCEY OF TULLICHETTLE
My Lords,
For the reasons given by my noble and learned friend Lord Bridge of
Harwich I too would allow the appeal and make the order that he proposes.
LORD BROWNE-WILKINSON
My Lords,
For the reasons given by my noble and learned friend Lord Bridge of
Harwich I too would allow the appeal and make the order that he proposes.
LORD NOLAN
My Lords,
For the reasons given by my noble and learned friend Lord Bridge of
Harwich I too would allow the appeal and make the order that he proposes.
– 13 –
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