Fair compensation?

Damages for personal injury is an area of the law which has benefited considerably from legislative intervention. Significant changes have been brought about by statute, without which the law might have remained unclear, unresolved, or in some cases unfair.

There are many examples.

• Unpaid services rendered to an injured person (such as nursing, bathing, dressing, shopping and cooking) used to be unrecognised. Section 8 of the Administration of Justice Act 1982 enabled appropriate monetary recompense to be made.
• Personal services which an injured person can no longer render (such as DIY, childcare, and gardening) were similarly unacknowledged in damages cases. Section 9 of the 1982 Act changed matters and created a competent head of claim.
• Deductions from damages is another area which benefits from legislative clarification. Where an injured person receives state benefits or pension payments or grants from a benevolent fund, the question whether damages should be reduced to any extent to reflect those payments is a matter governed by s 10 of the 1982 Act, ensuring that, for example, payments made from a benevolent disaster fund do not result in a reduction of any award of damages.
• The possibility that a more serious condition caused by the negligent act might emerge in the future was traditionally dealt with on a “once-and-for-all” basis, possibly resulting in under- or over-compensation. An injured leg might ultimately, after unsuccessful conservative treatment, require amputation; an epileptic condition might slowly develop; mesothelioma might not appear until many years after asbestos exposure. Section 12 of the 1982 Act introduced the concept of provisional damages, in terms of which a pursuer can recover a certain amount of damages but return to the court many years later seeking additional damages, once the condition has been diagnosed.
• Where a young child is injured, questions may arise concerning the management of any damages awarded to the child. Section 13 of the Children (Scotland) Act 1995 empowered the court to “make such order as it thinks fit relating to the payment and management of the sum for the benefit of the child”.

Decades have passed since those statutes were enacted. There have been major socio-legal changes and developments. Is further reform needed to reflect those changes? Would these areas of personal injury law benefit from some further statutory intervention?

In a Discussion Paper on Damages for Personal Injury (Scot Law Com No 174) published on 23 February 2022, the Scottish Law Commission provides a survey of current law and practice, and seeks views concerning possible further reform of the law relating to damages for services, deductions from damages, provisional damages, and management of children’s awards.

Services claims

One important question relates to services. Should s 8 claims for necessary services continue to be restricted to “relatives”? As the discussion paper points out, in modern society an injured person may have little or no support from family members. A friend or neighbour may have given significant assistance by providing services on a gratuitous basis, such as shopping, cooking, cleaning, bathing, and so on. Should an award in terms of s 8 be extended to include friends and neighbours? Such an extension might be seen to reflect changes in society, including the fact that a large percentage of the population no longer live in family units. While therefore the Commission in 1978 took the view that “it is only within the family group that there is a demonstrable social need to allow recovery in respect of services rendered”, it may be that circumstances have changed.

What about the loss of personal services formerly rendered by the injured person to relatives (s 9 claims)? Should there be a similar extension to non-relatives? In 1978 the Commission thought not. In the current discussion paper, the Commission seeks views, asking: “Would society today still consider the loss of personal services previously rendered to a non-relative as too remote, and not within the reasonable foreseeability of the responsible person? There would be a broad spectrum of possible claimants, some (but not others) closely reflecting the model of a family group. Examples might include two friends living together, one providing personal care to the other less able party; a neighbour providing personal care such as shopping and grass-cutting for one or more individuals, generally ‘keeping an eye’ on them as they have no one else to help; someone providing a ‘befriending’ service, perhaps visiting a non-relative in their own home once a week.”

The Commission would welcome views on this issue.

Deductions

The discussion paper also examines deductions from damages, including matters relating to social security benefits, treatment from the NHS, and care and accommodation, both private and local authority. There is discussion concerning the issue of an employee’s permanent health insurance and the Scottish authority of Lewicki v Brown & Root Wimpey Highland Fabricators 1996 SC 200, generally considered to be divergent from English authority. Ultimately the Commission suggests that the relevant authorities may be reconcilable on the basis that wherever an employee can demonstrate that they have contributed financially to a permanent health insurance scheme (even if only by paying tax and national insurance contributions on the notional benefit arising from membership of the scheme), any payments emanating from that scheme should not be deductible. Views are sought and questions asked, including whether any reform of s 10 of the Administration of Justice Act 1982 is required.

Provisional damages

In a chapter concerning provisional damages, the Commission requests views about asbestos-related disease, and in particular whether an unforeseen time bar problem concerning pleural plaques and subsequent more serious disease such as mesothelioma, has emerged. This would arise from a combination of the Prescription and Limitation (Scotland) Act 1973 (the three-year limitation), the Administration of Justice Act 1982 (provisional damages), the Damages (Asbestos-related Conditions) (Scotland) Act 2009 (pleural plaques and other asbestos-related conditions to be personal injury for which damages can be recovered, contrary to the approach adopted in the House of Lords in Rothwell v Chemical & Insulating Co in 2007), and the decision in Aitchison v Glasgow City Council 2010 SLT 358 emphasising the principle of “one action, one harm”. The recent decisions of Quinn v Wright’s Insulations 2020 SCLR 731 and Kelman v Moray Council [2021] CSOH 131 are referred to, as illustrations of a possible solution lying in the discretionary power given to the court by s 19A of the 1973 Act. Views are sought on this important issue.

Management of children’s awards

Finally the paper discusses the management of awards of damages to children. The roles of the court and the Accountant of Court are examined, as are ss 11 and 13 of the Children (Scotland) Act 1995, and the option of setting up a trust. Reference is made to an article by D A Kinloch and C McEachran, “Damages for Children – Some Reflections” (2003) 51 Rep B 2. There the view is expressed that “Even if the decree is for a very substantial amount, it is considered demeaning to concerned parents to suggest that they are not capable of managing a capital sum awarded to their child, when they have responsibility for his or her care, education and upbringing and with all the other major decisions in his or her life”.

Nevertheless it might be thought that some parents or guardians, when faced with the task of investing and managing large sums of money for the child, may welcome assistance. It is also suggested that a possible procedure might be for the court, when about to grant decree for damages for a child, to make inquiries about the future administration of funds and property to be held for the child, and if considered necessary, to remit the case to the Accountant of Court for a report in terms of s 13.

Responses welcome

The discussion paper acknowledges the invaluable assistance provided by many personal injury practitioners and by the Accountant of Court and her staff. The Commission looks forward to receiving further experiences and views when consultees respond to the questions posed in the paper. All responses, whether or not covering every question, will be welcome. The closing date for responses is 15 June 2022.