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«The Law Commission Law Com No 257 DAMAGES FOR PERSONAL INJURY: NON-PECUNIARY LOSS Item 2 of the Sixth Programme of Law Reform: Damages The Law ...»

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The Law Commission

Law Com No 257

DAMAGES FOR PERSONAL

INJURY:

NON-PECUNIARY LOSS

Item 2 of the Sixth Programme of Law Reform:

Damages

The Law Commission was set up by the Law Commissions Act 1965 for the

purpose of promoting the reform of the law.

The Law Commissioners are:

The Honourable Mr Justice Carnwath CVO, Chairman + Professor Andrew Burrows Miss Diana Faber Mr Charles Harpum Mr Stephen Silber, QC The Secretary of the Law Commission is Mr Michael Sayers and its offices are at Conquest House, 37-38 John Street, Theobalds Road, London WC1N 2BQ.

This terms of this report were agreed on 15 December 1998.

The text of this report is available on the Internet at:

http://www.open.gov.uk/lawcomm/ + At the date of signing, the Chairman was the Honourable Mrs Justice Arden DBE, who was succeeded on 2 February 1999 by the Honourable Mr Justice Carnwath CVO.

ii

THE LAW COMMISSION

DAMAGES FOR PERSONAL INJURY:

NON-PECUNIARY LOSS

CONTENTS Paragraphs Page PART I: INTRODUCTION 1.1-1.11 1 PART II: WHERE CHANGE IS NOT REQUIRED 2.1-2.68 5

1. SHOULD DAMAGES FOR NON-PECUNIARY LOSS BE 2.1-2.3 5 AVAILABLE AT ALL?

2. SHOULD ENGLISH LAW ADOPT THE CANADIAN 2.4-2.7 5

“FUNCTIONAL” APPROACH TO THE ASSESSMENT OF

DAMAGES FOR NON-PECUNIARY LOSS?

3. SHOULD A CLAIMANT WHO IS UNAWARE OF HIS OR 2.8-2.24 6

HER INJURY BE ENTITLED TO DAMAGES FOR

NON-PECUNIARY LOSS?

4. SHOULD THERE BE A THRESHOLD FOR THE RECOVERY 2.25-2.28 10

OF DAMAGES FOR NON-PECUNIARY LOSS?

5. SHOULD INTEREST BE AWARDED ON DAMAGES FOR 2.29-2.58 11

NON-PECUNIARY LOSS AND, IF SO, HOW MUCH

INTEREST?

6. SHOULD DAMAGES FOR NON-PECUNIARY LOSS 2.59-2.64 19

SURVIVE THE DEATH OF THE VICTIM?

7. DOES THE QUESTION OF OVERLAP (BETWEEN 2.65-2.68 20

DAMAGES FOR LOSS OF EARNINGS AND DAMAGES FOR

LOSS OF AMENITY) RAISED IN FLETCHER V AUTOCAR

AND TRANSPORTERS LTD GIVE RISE TO DIFFICULTY?

PART III: WHERE CHANGE IS REQUIRED 3.1-3.205 22

I: INCREASING THE LEVELS OF DAMAGES

1. DAMAGES FOR NON-PECUNIARY LOSS FOR SERIOUS 3.1-3.110 22

PERSONAL INJURY SHOULD BE INCREASED

(1) Our questions for consultees 3.1-3.3 22 (2) Consultees’ responses 3.4-3.20 23 iii Paragraphs Page 3.5-3

–  –  –

PART V: SUMMARY OF RECOMMENDATIONS 5.1-5.17 107

APPENDIX A: DRAFT BILL WITH EXPLANATORY NOTES

APPENDIX B: RESEARCH CARRIED OUT BY THE OFFICE

FOR NATIONAL STATISTICS INTO PUBLIC PERCEPTIONS OF

WHAT DAMAGES FOR NON-PECUNIARY LOSS IN PERSONAL

INJURY CASES SHOULD BE

APPENDIX C: LIST OF PERSONS AND ORGANISATIONS

WHO COMMENTED ON CONSULTATION PAPER NO 140

–  –  –

DAMAGES FOR PERSONAL INJURY:

NON-PECUNIARY LOSS

To the Right Honourable the Lord Irvine of Lairg, Lord High Chancellor of Great Britain PART I

INTRODUCTION

1.1 In June 1995 the then Lord Chancellor announced the Law Commission’s Sixth Programme of Law Reform which included, as the Fifth Programme had done, an

item concerning damages. The Programme states:

that an examination be made of the principles governing and the effectiveness of the present remedy of damages for monetary and nonmonetary loss, with particular regard to personal injury litigation.

Certain matters to which specific consideration is to be given include:

–  –  –

In 1996 we published a consultation paper2 on damages for non-pecuniary loss.

1.2 The central issues considered in the paper were, first, whether current awards of damages for non-pecuniary loss in personal injury cases are at satisfactory levels, and secondly, whether changes should be made to the assessment of those damages. The latter question required consideration of the role of juries. The paper went on to address the role of juries in assessing quantum in non personal injury cases.

1.3 We received 164 responses to the consultation paper from individuals and organisations representing a broad spectrum of the community. A list of those who responded to the consultation paper is set out at Appendix C. We are very grateful for the time and effort spent by consultees. The arguments and insights put to us have been of invaluable assistance in the formulation of our final recommendations, as the detailed reference which we make to individual responses will demonstrate.





1.4 The extent of the current debate on the adequacy of damages for non-pecuniary loss in personal injury cases was commented on by Henry LJ, in his Foreword to Item 2 of the Sixth Programme of Law Reform (1995) Law Com No 234.

Damages for Personal Injury: Non-Pecuniary Loss (1995) Consultation Paper No 140. The paper is 1995 copyright, although it was published early in January 1996.

the latest edition of the Judicial Studies Board Guidelines for the Assessment of

General Damages in Personal Injury Cases. He said:

–  –  –

1.5 We have sought to do justice to the range of points of view expressed in this debate. In particular, we accept the contention repeatedly made by consultees that the fairness of awards is partly reliant on their being perceived to be fair.

Accordingly we have commissioned research from the Office for National Statistics into public perceptions of what the levels of damages for non-pecuniary loss in personal injury cases ought to be.4

1.6 Our conclusion is that awards of damages for non-pecuniary loss in cases of serious personal injury are too low and should generally be increased by a factor of at least 1.5, but by not more than a factor of 2 (or, in other words, that they should be increased by not less than 50 per cent, but by not more than 100 per cent). We make provision, however, for a tapered increase of between 1 and 50 per cent for injuries which fall just within our proposed definition of serious injury. We define a serious personal injury as one for which damages for pain and suffering and loss of amenity for that injury alone would be more than £2,000 (under the present law).5

1.7 We have reached the view that this increase would best be effected by the Court of Appeal and/or the House of Lords, using their existing powers to lay down guidelines as to quantum in the course of personal injury litigation. If change is not (4th ed 1998). Henceforward we shall refer to these as the “JSB Guidelines”. The first edition was published in 1992, the second in 1994 and the third in 1996. At the time of the publication of Damages for Personal Injury: Non-Pecuniary Loss (1995) Consultation Paper No 140 the second edition was current. The status of the JSB Guidelines has recently been considered by the Court of Appeal in Reed v Sunderland Health Authority, The Times 16 October 1998. Beldam LJ, with whom Potter LJ agreed, referred to the JSB Guidelines as well as to three cases cited to him, when concluding that the award below for damages for pain and suffering and loss of amenity should be reduced. Staughton LJ agreed with Beldam LJ’s proposed order, but went on to comment on the status of the JSB Guidelines.

He confirmed his view, expressed in Arafa v Potter [1994] PIQR Q73, Q79, that the JSB Guidelines are not in themselves law, since the Judicial Studies Board has no legislative power. The Guidelines should therefore be regarded with the respect accorded to the writings of any specialist legal author. He noted that Lord Woolf MR would go further, since he wrote in his Foreword to the third edition of the JSB Guidelines that they are “the most reliable tool, which up to now has been made available to courts up and down the land as to what is the correct range of damages for common classes of injuries”. Staughton LJ considered that he had undervalued the Guidelines when he described them in Arafa as “a slim and handy volume which anyone can slip into their briefcase on the way to the county court or travelling on circuit.” Nevertheless the law is to be found elsewhere in rather greater detail and so the Court of Appeal should not refer only to the JSB Guidelines.

Hence his comment in the Arafa case that “In this Court we ought to look to the sources rather than the summary produced by the Judicial Studies Board...”, should be amended to say “In this Court we ought to look to the sources as well as the summary produced by the Judicial Studies Board.” See Appendix B below for the full text of the research and paras 3.42-3.64 below for discussion of it.

See paras 3.40 & 3.110 below.

effected in this way within a reasonable period, we recommend that damages should be increased by the enactment of a short legislative provision.

1.8 It will be plain from the above that we do not recommend the extension of jury trial in personal injury cases. Rather, we have concluded that the assessment of damages for personal injury should always be for a judge and should never be left to a jury.7 We also recommend that compensatory damages, other than in defamation cases, should be assessed by judges.8 Finally, we take this opportunity to “sweep up” and marginally extend our recommendations on juries in our report on Aggravated, Exemplary and Restitutionary Damages.9 We therefore here recommend that judges should in all cases decide whether to award, and, if so, the amount of, punitive or restitutionary damages.

1.9 The only immediate legislative change which we recommend is therefore in respect of juries. A draft Bill to give effect to our recommendations is to be found at Appendix A. We should make clear that we have considered whether that draft Bill complies with the European Convention of Human Rights, and we confirm that in our view it plainly does.

1.10 The rest of this paper sets out in detail the reasoning behind our recommendations. Part II addresses the issues raised in the consultation paper in respect of which we do not recommend change. Parts III and IV set out our proposals for change. Part V contains a summary of our recommendations. As we have said above, a draft Bill to give effect to our recommendations about juries is to be found at Appendix A. Appendix B contains the results of the empirical research carried out on our behalf. Appendix C contains a list of those who responded to the consultation paper. We have not included a separate section on the present law, since this is generally well-known and is set out in some detail in our consultation paper.10 We have, however, set out any important recent developments in the law at the relevant point in the discussion.

1.11 We gratefully acknowledge the great assistance provided to us in the preparation of this report by: Lord Woolf MR, Lord Bingham CJ, and the Judges’ Council, who particularly helped us with our analysis of the pros and cons of different possible methods for increasing the tariff of awards for non-pecuniary loss in personal injury cases; Lord Justice Brooke and Lord Justice May, who advised us on the practicalities of the Court of Appeal issuing guidelines on damages for nonpecuniary loss in personal injury cases; the Office for National Statistics and, in particular, Ms Olwen Rowlands, the Omnibus Project Manager and Ms Lynne Henderson;11 Dr Mavis McLean of Wolfson College, Oxford and of the Lord

–  –  –

Chancellor’s Department, who advised us on the design and interpretation of the empirical research; the Association of British Insurers (“ABI”) and the Association of Personal Injury Lawyers (“APIL”), who provided financial assistance, without which it would not have been possible for us to commission the empirical research; both also commented on the design of the research and the ABI assisted us to assess the impact on insurance premiums of our proposals for damages for non-pecuniary loss in personal injury cases; Mrs Ann Smart of St Hugh’s College, Oxford, who carried out the analysis of responses to consultation. We are also grateful to the following for their help: Mr Richard Clayton, Mr Martin Eaton of the Foreign and Commonwealth Office; Lord Gill of the Scottish Law Commission, Mr Justice Girvan, Jeremy Gompertz QC, Ms Tamara Goriely, Mr Justice Morland, the Police Federation, Mr Justice Popplewell, Dr David Thomas of the Institute of Criminology, University of Cambridge, Hugh Tomlinson and Professor Martin Wasik of the University of Manchester.

PART II WHERE CHANGE IS NOT REQUIRED

1. SHOULD DAMAGES FOR NON-PECUNIARY LOSS BE AVAILABLE AT ALL?

2.1 In the consultation paper we reached the strong provisional conclusion that damages for non-pecuniary loss owing to personal injury should be retained.1 Such damages recognise the personal as well as the financial consequences of injury.

Abolition of them may be thought to discriminate unfairly against those, such as the unemployed, who do not suffer any, or any substantial, pecuniary loss as a result of personal injury. Furthermore, almost all of the accident victims who took part in our empirical survey thought that damages should be available for nonpecuniary loss.2



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