journal of personal injury law

J O U R N A L O FP E R S O N A L I N J U R Y

L A W

Bulletin BoardArticlesLiability What is Actionable Injury? The Demise of the Pleural Plaques LitigationAllan Gore Q.C.

Liability for Sporting InjuriesBruce Gardiner

What is a Stress-Related Injury? Clive Wood

QuantumUncertainty about Uncertainty: Damages for Loss of a ChanceAndrew Burrows

Periodical Payments after the Court of Appeal decision in ThompstoneHarry Trusted

ProcedureThe Future of Personal Injury: The High Street PractitionerJohn McQuater

Forum Non Conveniens in the US: Are the Courtroom Doors Finally Shut?Michael McParland

Lawyer or Counsellor?Sarah Morgan and Dr David Enoch

Road Traffic Accidents in Europe: A Major Victory for Claimants before the EuropeanCourt of Justice Michael McParland

Case & CommentBulletin Board Digest

Liability

Office of Fair Trading v Lloyds TSB Bank Plc

Conn v Sunderland CC

Isik v Clegg

Ellis v William Cook Leeds Ltd

Hughes v Guise Motors

Parker v Levy

Clegg v Rogerson

Quantum

Johnston v NEI International Combustion Ltd,Rothwell v Chemical & Insulating Co Ltd,Topping v Benchtown Ltd, Grieves v FT Everard& Sons

Grieves v FT Everard & Sons

Cameron v Vinters Defence Systems

Garth v Grant & MIB

Whipps Cross University NHS Trust v Iqbal

Smith v Bolton Copper Ltd

Bereavement damages

Tameside & Glossop Acute Services NHS Trustv Thompstone, South Yorkshire Strategic HealthAuthority v Corbett, United Bristol HealthcareNHS Trust v RH, South West London StrategicHealth Authority v De Haas

Procedure

O’Byrne v Aventis Pasteur SA

Hoddinott v Persimmon Homes

Jones v Associated Newspapers Ltd

Jones v Wrexham BC

Crane v Canons Leisure Centre

Hall v Stone

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JOURNAL OF PERSONAL INJURY LAW[2008 ] J.P.I.L. 1–96; C1–C62

THOMSON, SW

EET & M

AXWELL

Issue 1 2008

JPIL Cover 1-08:v 18/2/08 13:47

General Editor: Muiris LyonsSolicitor and Partner with Irwin Mitchell, LondonFellow of APILMember of the Law Society personal injury and clinical negligence panelsSpecialities: Catastrophic Injury Claims, Clinical Negligence andHealthcare Law

Case and Comment Editor: Nigel TomkinsConsultant Director of APIL TrainingLegal and Training ConsultantConsultant with Freethcartwright Solicitors, NottinghamSpecialities: Civil Litigation, Occupational and Health & Safety Law

Editorial Board: Nigel Cooksley Q.C.Old Square Chambers, Verulam Buildings, Gray's Inn, LondonMember of the Personal Injury Bar Association, the Association of Personal Injury Lawyers,and the Professional Negligence BarSpecialitites: Product Liability and Group Litigation

Colin EttingerSolicitor and Partner with Irwin Mitchell, LondonSpecialities: Catastrophic Injuries and Occupational Health

Allan Gore Q.C. 12 King's Bench Walk, Temple, London. Past President and fellow of APIL Specialities: Personal Injury

Mark Harvey Solicitor and Partner at Hugh James Solicitors, Cardiff Fellow of APIL and Member of the Civil Justice Council Specialties: Product Liability, Travel Law and Group Actions

Denise KitchenerChief Executive, Association of Personal Injury Lawyers

Simon LindsaySolicitor and Partner at Bevan Brittan SolicitorsSpecialities: Clinical Negligence and Mental Health Law

Frances McCarthySolicitor and Partner at Pattinson & BrewerPast President of APIL and Member of the Woolf working party formulating pre-actionprotocols; Member of the Civil Justice Council

John McQuaterSolicitor and Partner at Atherton Godfrey, DoncasterFellow of APILMember of the Law Society personal injury and clinical negligence panelsSpecialities: Road Traffic Accidents, Employers Liability Claims and Clinical Negligence

Professor Mark MildredSolicitor, Professor of Litigation at Nottingham Law SchoolSpecialities: Product Liability and Group Litigation

Jason RowleySolicitor and Managing Partner at Vizards WyethDeputy Costs Judge, Past President of FOILSpecilialities: Personal Injury; Costs and Funding

Subscriptions: The 2008 subscription to this Journal is available for £258.00 post free. APIL members are entitled to a discount of 20 per cent(£206.40). Orders should be addressed to the Customer Services Department, Sweet & Maxwell, Cheriton House, North Way, Andover, Hants,SP10 5BE.

ISSN: 1352 7533

Citation: The Journal of Personal Injury Law should be cited as [2008] J.P.I.L. followed by the page number.

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JOURNAL OF PERSONAL INJURY LAW

Contributor’s Information Sheet

• The Journal provides:• Information on the key cases decided in the last quarter.• Information on the key statutes published in the last quarter.• Information on the key regulations and other developments in the last quarter.• Analysis of developments by experienced practitioners.• Practical guidance on procedure.

• The Journal is published quarterly.• Each issue includes “Articles” written by barristers, solicitors and academics many

of whom are leaders in their fields (and appeared in the relevant cases) as well ascontributions from up and coming personal injury lawyers.

• Each issue contains “Case and Comment” a concise summary of the most impor-tant cases with expert analysis and editorial comment on the meaning and effect ofthe case set against the background of the present law.

• Each issue also has a “Bulletin Board” setting out on one page the names and ref-erences of the key cases, statutes, regulations and other developments over the lastquarter.

• The Journal has an estimated readership of thousands of solicitors, barristers, expertsand academics who practice in, or are connected with, personal injury law.

• Articles from The Journal are summarised in services such as Lawtel, Butterworth’s PIOnline, Legal Information Resources and the APIL Newsletter.

• The Editor welcomes articles on any personal injury topic of current interest (we can-not of course guarantee that they will be published). Please submit articles to:

Muiris Lyons,Editor of the Journal of Personal Injury Law,Irwin Mitchell150 HolbornLondonEC1N [email protected]@sweetandmaxwell.co.uk

Contributor’s Guide: Please:

• Provide the article on paper and on floppy disc or via e-mail.• Submit in Word for Windows or Wordperfect or Rich Text Format or ASCii.• Make it as Iong or short as you like but the average length is around 10–20 pages of A4

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the key issues covered and conclusions so that readers can tell at a glance what the arti-cle is about.

• Provide your full name/s and work address and contact telephone numbers if you wishthese to be printed at the top of the article.

• Only submit original work which has not been published elsewhere.• Do not libel anyone in the article!

Thank you.

J.P.I.L. is run in association with the Association of Personal Injury Lawyers (APIL). If you require further information on the organisation, please contact Marlene Lord on 0115 958 0585 or [email protected].

JPIL Cover 1-08:v 18/2/08 13:47

JOURNAL OFPERSONAL INJURY LAW

March 2008

ContentsBulletin Board B1

Articles

Liability

What is Actionable Injury? The Demise of the Pleural Plaques Litigation 1Allan Gore Q.C.

Liability for Sporting Injuries 16Bruce Gardiner

What is a Stress-Related Injury? 26Clive Wood

Quantum

Uncertainty about Uncertainty: Damages for Loss of a Chance 31Andrew Burrows

Periodical Payments after the Court of Appeal decision in Thompstone 44Harry Trusted

Procedure

The Future of Personal Injury: The High Street Practitioner 53John McQuater

Forum Non Conveniens In the US: Are the Courtroom Doors Finally Shut? 58Michael McParland

Lawyer or Counsellor? 82Sarah Morgan and Dr David Enoch

Road Traffic Accidents in Europe: A Major Victory for Claimants before the EuropeanCourt of Justice 89Michael McParland

Case & Comment C1

Bulletin Board Digest C35

Editorial:

Welcome to the March edition of JPIL.

This edition of the Journal was put together over the Christmas period and finalised in January 2008.We kept the edition back as long as we possibly could so we could include the Court of Appealjudgment on indexation in the Thomstone and Corbett appeals, which will be delivered on January14.In this edition Harry Trusted comments on the judgment and considers its implications.

Looking forward to 2008, we anticipate the Ministry of Justice’s response to its consultation on theclaims process and also its response to the damages consultation. We shall no doubt learn more aboutthe likely impact the Clementi Reforms will have, but it is plain they will be significant. On this note,John McQuater has turned his paper, delivered at the JPIL Conference in November, which considersthe future of personal injury for the high-street practitioner, into article form.

One thing we do know is that, bar legislative intervention by the Government, 2008 will see no morepleural plaques claims. In this edition, Allan Gore Q.C. reviews the pleural plaques litigation andcritiques the House of Lords decision.

In the March liability section, we also have a review of the key cases on establishing liability in sportinginjuries from barrister Bruce Gardiner and an analysis of what constitutes a stress-related injury frompsychologist Dr Clive Wood.

In our quantum section, as well as the aforementioned article from Harry Trusted, I am delighted toinclude an article from former Law Commissioner and noted academic Andrew Burrows on damagesfor loss of a chance. This paper is an edited version of his lecture to the Personal Injury Bar Association(PIBA) Conference. I am grateful to PIBA for their cooperation in publishing this. In the article Andrewconsiders the whole range of case law on this issue, drawing together the different strands includingcases on contract and economic loss. He looks at the way the law has developed in cases such asMcGhee, Hotson, Wilsher, Fairchild and Gregg, culminating in the recent House of Lords decisionin Barker v Corus. In what is without doubt a tour de force of an article, he considers the extent towhich the law distinguishes between multi-agent and single agent causes and seeks to rationalise andreconcile the decisions reached by the courts in the leading cases.

In our procedure section we have a first for JPIL: two articles by the same author. This is purelycoincidental in terms of timing, but we are delighted to have two articles from Michael McParland. Thefirst looks at the issue of Forum Non Conveniens in the US resulting from recent unsuccessful attemptsto pursue claims on behalf of UK claimants in the US (such as the recent Vioxx litigation).He analysesthe approach of the US courts in this issue and concludes that it will now be extremely difficult tosuccessfully bring such claims in the US in the future. The second article is an analysis of the impactof the European Court of Justice decision in the case of FBTO Schadervezekeringen, confirming thatthe insurance provisions of the Fifth Motor Directive permit victims of road traffic accidents in anotherMember State to bring direct actions against European domiciled insurers in the court’s of the victim’sown domicile.

Finally, in our procedure section we have an article from NUT solicitor Sarah Morgan and psychiatristand expert witness Dr David Enoch entitled Lawyer or Counsellor. As personal injury lawyers we haveall acted for clients who have been traumatised and this interesting article offers an insight into therole we play as de facto counsellors. It highlights the benefits to the client of being able to relate totheir lawyer on this level but also examines the risks to both lawyer and client of this approach, giventhat as lawyers we are not properly trained or equipped with the necessary skills to undertake such arole. The article is a thought-provoking one and poses the question how far should, what many willfeel is merely good client care, go?

Finally, the Digest Editor Nigel Tomkins and the JPIL Board keep you up to date with all the importantcases and developments in the field of personal injury law in the Digest, Bulletin Board and Case andComment sections.

Muiris LyonsGeneral EditorJanuary 2, 2008

bulletin board

Bulletin Board

Liability

Office of Fair Trading v Lloyds TSBBank Plc, (Hoffman, Hope, Walker,Brown & Mance L.JJ.), October 31,2007, [2007] UKHL 48, HLConsumer credit agreements --- credit cards --- terri-torial application --- foreign transactions --- extent ofconnected lender liability --- debtor creditor sup-plier agreements ---Consumer Credit Act 1974s.75(1) ---Consumer Credit Act 1974 s.12(b) ---Consumer Credit Act 1974 s.11(1)(b) ---Consumer Credit Act 1974 s.11(3) ---ConsumerCredit Act 1974, s.187(1) --- see Comment

Conn v Sunderland CC, (Ward, Bux-ton, Gage L.JJ.), [2007] EWCA Civ1492, CA (Civ Div)Employers liability --- stress --- harassment --- bully-ing at work --- criminal conduct --- course of con-duct ---Protection from Harassment Act 1997 --- seeComment

Isik v Clegg (Tugendhat J.), November8, 2007, [2007] EWHC 2552 (QB) QBDPersonal injury --- road traffic accidents --- low veloc-ity impact collisions --- burden of proof --- civilevidence --- false statements ---medical evidence ---inaccurate information --- see Digest

Ellis v William Cook Leeds Ltd (Chad-wick, May, Moore-Bick L.JJ.), Novem-ber 1, 2007, [2007] EWCA Civ 1232, CA(Civ Div)Personal injury --- accidents at work --- employers’liability --- foreseeability --- reg. 4(3) of the Pro-vision and Use of Work Equipment Reg-ulations 1998 --- reg. 8(1)(c) of the LiftingOperation and Lifting Equipment Regula-tions 1998 --- safe system of work --- negligence--- contributory negligence --- expert evidence --- seeComment

Hughes v Guise Motors (Tugendhat J.),October 23, 2007, [2007] EWHC 2529(QB), QBDPersonal injury --- road traffic accidents --- break-down on motorway --- subsequent collision --- high-way code provisions --- contributory negligence ---remaining in car following breakdown --- see Digest

Parker v Levy (John Leighton WilliamsQ.C.), June 20, 2007, (2007) 151 S.J.L.B.1166 QBDPersonal injury --- liability --- occupiers liability ---risk of injury --- risk assessments ---marinas ---moorings ---Occupiers’ Liability Act 1957 ---standard of care --- negligence --- see Digest

Clegg v Rogerson (Nimmo Smith,Wheatley, Brodie L.JJ.), December 4,2007, [2007], ScotCS CSIH 87, IHPersonal injury --- road traffic accidents --- collisionwith train --- user worked level crossing ---RoadTraffic Act 1988 ---highway code provisions ---apportionment --- causation --- see Digest

Quantum

Johnston v NEI International Com-bustion Ltd, Rothwell v Chemical &Insulating Co Ltd, Topping v Bench-town Ltd, Grieves v FT Everard &Sons (Hoffman, Hope, Scott, Rodger &Mance L.JJ.), October 17, 2007 [2007]UKHL 39, HLPersonal injury --- employers’ liability --- asbestosexposure --- pleural plaques --- anxiety --- risk offuture disease --- causes of action --- psychiatricharm --- reasonable fortitude --- Supreme Court Act1981 s.32a --- see Digest

Grieves v FT Everard & Sons (Hoffman,Hope, Scott, Rodger & Mance L.JJ.),October 17, 2007, [2007] UKHL 39, HLPersonal injury --- causes of action --- psychiatricinjury --- reasonable fortitude --- employers’ liability

[2008] J.P.I.L. ISSUE 1/08 SWEET & MAXWELL LTD AND CONTRIBUTORS B1

[2008] JOURNAL OF PERSONAL INJURY LAW

--- asbestos exposure --- pleural plaques --- risk offuture disease ---Supreme Court Act 1981s.32a --- see Digest

Cameron v Vinters Defence SystemsLtd (Holland J.), October 12, 2007,[2007] EWHC 2267 (QB), QBDPersonal injury --- quantum--- fatal accidentclaims --- damages for pain and suffering ---deductions ---mesothelioma --- overlap ofdamages ---meaning of ‘‘benefit’’, Fatal Acci-dents Act 1976 s.4 --- credit for awards underpneumoconiosis etc. (Workers’ Compensation) Act1979 --- see Comment

Garth v Grant & MIB (HickinbottomH.H.), unreported elsewhere, May 25,2007, QBDDamages --- personal injury --- road trafficaccidents --- provisional damages ---medical treat-ment --- risk of deterioration after operation ---multipliers --- obesity --- disability ---Ogden Tab-les ---meaning of disability ---Supreme Court Act1981 s.32a --- see Comment

Whipps Cross University NHS Trustv Iqbal (Laws, Gage, Rimer L.JJ.),November 20, 2007, [2007] EWCA Civ1190, CA (Civ Div)Personal injury --- clinical negligence ---birth trauma --- quantum--- loss of earnings --- childclaimant --- loss of expectation of life --- lost yearsearnings --- see Comment

Smith v Bolton Copper Ltd (MasterWhitaker), unreported elsewhere, July10, 2007, QBDDamages --- personal injury --- asbestos exposure---mesothelioma --- JSB guidelines ---measure ofdamages --- short survival period --- dependencyclaims --- brothers --- assessment of dependencyclaim ---Fatal Accidents Act 1976 --- see Digest

Bereavement damagesDamages --- personal injury ---Fatal Accidents Act1976 ---Fatal Accidents (Northern Ireland) Order1977 --- bereavement awards --- level of awards--- see Digest

Tameside & Glossop Acute ServicesNHS Trust v Thompstone, SouthYorkshire Strategic Health Authorityv Corbett, United Bristol HealthcareNHS Trust v RH, South West LondonStrategic Health Authority v De Haas(Waller L.J. V.-P., Buxton L.J., SmithL.J.) January 17, 2008 [2008] EWCA Civ5, CA (Civ Div)Personal injury --- damages --- future loss ---indexation --- periodical payments orders --- correctapproach to exercise of power to make peri-odical payments orders under s.2(1) of theDamages Act 1996 --- care expense --- retail pricesindex --- ashe 611 --- burden of proof --- s.2(9) ofthe Damages Act 1996 --- s.2(8) of the Dam-ages Act 1996 --- s.2(1) of the Damages Act1996 --- guidance on future cases and the use ofexperts

Procedure

O’Byrne v Aventis Pasteur SA (Arden,Moore-Bick L.JJ. and Sir AnthonyClarke M.R.), October 9, 2007, [2007]EWCA Civ 966, CAPersonal injury --- product liability --- procedure--- limitation periods --- substitution of parties ---mistake --- substitution after expiry of limita-tion period --- necessity ---misnomer --- the Limita-tion Act 1980 ss.11a(3), 35(5) and 35(6) ---directive 85/374 on Liability for Defective Prod-ucts 1985 --- see Comment

Hoddinott v Persimmon Homes (Wes-sex) Ltd (Sir Anthony Clarke M.R.,Dyson and Jacob L.JJ.), November 21,2007, [2007] EWCA Civ 1203, CA (CivDiv)Civil procedure --- claim forms --- service ---applications without notice --- extensions of time forservice --- failure to dispute court’s jurisdiction ---setting aside without notice orders extending timefor service of claim form ---CPR r.7.6(1) andr.1 --- see Comment

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JOURNAL OF PERSONAL INJURY LAW

Jones v Associated Newspapers Ltd(Eady J.), June 25, 2007, [2007] EWHC1489 (QB), QBDCivil procedure --- costs ---Pt 36 offers --- judgmentagainst defendant ---Pt 36 offers --- proposals con-tained in claimant’s Pt 36 offer ---meaning of ‘‘atleast as advantageous to claimant’’ --- indemnitycosts --- enhanced interest: CPR Pt 36.14(1)(b) ---see Digest

Jones v Wrexham BC (Waller (V.P.),Longmore, Hughes L.JJ.), December19, 2007, [2007] EWCA Civ 1356, CA(Civ Div)Civil procedure --- personal injury --- legal adviceand funding --- costs --- conditional fee agreements ---claims management --- after the event insurance ---construing a CFA agreement ---meaning of words‘‘or otherwise’’ --- reg.3a(5) of the Conditional FeeAgreements (Miscellaneous Amendments) Reg-ulations 2003 --- reg.4(e)(ii) of the ConditionalFee Agreements Regulations 2000 ---CPR Pt43.2(3) --- see Digest

Crane v Canons Leisure Centre (May,Maurice Kay, Hallett, L.JJ. and ChiefMaster Hurst), December 19, 2007,[2007] EWCA Civ 1352, CACivil procedure --- personal injury --- legal adviceand funding --- costs --- collective conditional feeagreements --- conditional fee agreements --- successfees --- recoverability on costs consultants fees --- seeDigest

Hall v Stone (Waller (V.P.), Smith,Lloyd, L.JJ.), December 18, 2007, [2007]EWCA Civ 1354, CA (Civ Div)Personal injury --- road traffic accidents --- low veloc-ity impact collisions --- costs --- conduct --- costs ---small claims assigned to multi-track --- allegationsof dishonesty and inflated claims ---CPR Pt44.3 --- see Digest

[2008] J.P.I.L. ISSUE 1/08 SWEET & MAXWELL LTD AND CONTRIBUTORS B3

liability

What is Actionable Injury? TheDemise of the Pleural PlaquesLitigation

ALLAN GORE Q.C.1

Asbestos; Breach of contract; Causes of action; Compensation; Employers’liability; Industrial diseases; Pleural membrane; Psychiatric harm

Abstract

Allan Gore Q.C. analyses the recent decision of the House of Lords in Johnston v NEIInternational Combustion Ltd (the ‘‘pleural plaques’’ litigation). ML

Introduction:

Expansion and contraction of the lung in the course of respiration is facilitated by a slipperymembrane which surrounds it, namely the two layers to the pleura. The parietal pleura linesthe inside of the rib cage and protects the lung from rubbing directly against the ribs. Thevisceral pleura lies inside the parietal pleura and covers the lung. Normally there is no gapbetween these layers, and the lubrication by pleural fluid between the layers means that as thelung expands and contracts, the two layers slide largely frictionless against each other. Thepleura is separate from, and not part of, the lung. The properties that led to the multitudeof industrial uses of asbestos (insolubility, heat and acid resistance, fibrousness) mean thatthose fibres not expelled by coughing, sneezing and the like, or cleared by transfer up themucocilliary escalator,2 lodge in the respiratory tract. Some are engulfed by scavenger cells(macrophages) which are usually killed in the process, leaving telltale ‘‘asbestos bodies’’ whichcan be seen microscopically.3 The remainder simply lie in the body. The route by whichfibres reach the pleura has not been fully elucidated, but reach it they do, and there, theyare associated with the causation of pleural consequences, one of which are so-called pleuralplaques.

1Allan Gore Q.C. appeared as Counsel for three of the claimants in the High Court case of Grieves and for one of theclaimants in the Court of Appeal case of Rothwell. He is in Chambers at 12 Kings Bench Walk, London, EC4Y 7EL.He is a past President of APIL and is a member of the JPIL Editorial Board. He can be contacted by telephone on 0207583 0811 and by e-mail at [email protected].

2Part of the respiratory system which carries intercepted particles toward the pharynx, where they are swallowed. Thisdesign can be compared to a conveyor belt for particles.

3It is the presence of these asbestos bodies in numbers in tissue samples that are often regarded as an indication ofsignificant exposure to asbestos.

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[2008] JOURNAL OF PERSONAL INJURY LAW—LIABILITY

Pleural plaques are localised areas of thickening with well-demarcated edges. They usuallydevelop on the parietal pleura but occasionally develop on the visceral pleura. They consistof collagen, a bland fibrous tissue. The pathogenesis is uncertain but it is believed that thepresence of asbestos fibres leads over time to a prolonged low-grade inflammatory responseleading to the laying down of this fibrous tissue. The following propositions were commonground throughout the litigation described below:

‘‘(a) Pleural plaques are by far the most common pathological effect of asbestosinhalation on the respiratory system;

(b) They may occur after occupational exposure at a lower level than is needed tocause asbestosis;

(c) The frequency and extent of occurrence have a relationship with the quantityof fibres inhaled and the duration of exposure;

(d) The presence of pleural plaques does not normally occasion any symptoms.Very occasionally, in fewer than 1% of cases, the patient may be aware of anuncomfortable grating sensation on respiration;

(e) Given an absence of symptoms, the presence of pleural plaques is onlyestablished by way of chest x-ray or C.T. scan or on post-mortem autopsy,often incidental to some other investigation. When reading an x-ray it may notalways be easy to distinguish between pleural plaques and pleural thickening;

(f) Pleural plaques are rarely detected during the first 20 years following exposureto asbestos. Moreover, exposure to asbestos does not necessarily result in thedevelopment of plaques, notwithstanding the passage of 20 years or more;

(g) With time, plaques may become more extensive.’’4

Dr Robin Rudd, the expert called on behalf of the claimants in this litigation has written:

‘‘Pleural plaques are not thought to lead directly to any of the other benign varietiesof asbestos-induced pleural disease, nor to pose any risk of malignant change leadingto mesothelioma. Their presence may indicate, nevertheless, a cumulative level ofasbestos exposure at which there is an increased risk of mesothelioma or otherasbestos-related disorders. On average, in the absence of any other evidence aboutexposure, it is reasonable to assume that subjects with plaques will have had higherexposure to asbestos than subjects without plaques. The frequency of developmentof other complications of asbestos exposure in persons with plaques is not a functionof the presence of the plaques, but of the asbestos exposure that caused plaques.Since plaques may occur after a wide range of different exposures, the risks ofother asbestos-related conditions may differ widely between different populationsand individuals with plaques.’’5

Compensation history

The first reported award of damages in England and Wales for pleural plaques appears to beBlackburn v Goole Shipbuilding & Repairing Co Ltd.6 The 65-year-old claimant was awarded

4Per Lord Phillips L.C.J. in Rothwell v Chemical & Insulating Co Ltd [2006] E.W.C.A. Civ 27 at [10] and see also HollandJ. at first instance in the same case sub nom Grieves v F T Everard & Sons [2005] E.W.H.C. 88 QB at [6].

5Occupational Disorders of the Lung Hendrick, Burge, Beckett and Churg (eds.) (Saunders, April 2002) Ch.21.6(Unreported) December 4, 1980, QBD, Leeds, Mustill J. (as he then was).

2 [2008] J.P.I.L. ISSUE 1/08 SWEET & MAXWELL LTD AND CONTRIBUTORS

WHAT IS ACTIONABLE INJURY?

£6,000 for pain and suffering and loss of amenity in respect of a condition causing himrespiratory disability, estimated at 10 per cent and leaving him with a 24 per cent chance ofdeveloping malignant disease. Later in the 1980’s, the actionability of pleural plaques in theusual symptomless case was considered in three decisions at first instance in each of whichthe Ministry of Defence sought to argue that they did not give rise to a cause of action. In allthree cases, the High Court judges (who went on to achieve considerable eminence), foundin favour of the plaintiffs. Their reasoning was not altogether consistent.

The first case was Church v Ministry of Defence7. A fitter had worked with asbestos in thenaval dockyard at Chatham until 1954. A routine X-ray in 1980 revealed pleural plaques.Peter Pain J. said8 that it was ‘‘an error to treat the pleural plaques on their own.’’ He heldthere was damage caused ‘‘by the asbestos passing through the lungs and causing the plaquesto form.’’ Adding that to the plaques themselves, he decided that it was not damage ‘‘sominor that the law should disregard it’’.

A month later Otton J. (as he then was) gave judgment in Sykes v Ministry of Defence.9

The plaintiff had worked with asbestos in the naval dockyard at Portsmouth. The judgewas referred to the decision in Church but his reasoning was not quite the same. He heldthat there was no need to add anything to the plaques to produce damage sufficient toattract compensation, and that it was sufficient that there had been a ‘‘definite change in thestructure of the pleura’’. That gave the plaintiff a cause of action and therefore, in assessingthe damages, one could take into account the risk of other diseases and the plaintiff’s anxiety.He awarded a global sum of £1,500 damages for ‘‘the three elements of physical damage,anxiety and the risks of further complications’’ but he did not, and did not need to, explainhow he would have assessed damages for the symptom-less plaques alone.

Section 6 of the Administration of Justice Act 1982 inserted s.32A into the Supreme CourtAct 1981 and introduced the jurisdiction to the High Court to award provisional damages.The first contested claim for provisional damages for pleural plaques was Patterson v Ministryof Defence10, another similar case from the naval dockyard at Chatham. Simon Brown J. (as hethen was) did not accept that a ‘‘symptom-free physiological change’’ such as a plaque wasan actionable injury. If Otton J. had decided the contrary, he disagreed. However, he heldthat the plaques together with the risk of future disease and anxiety could add up to a causeof action. The reasoning was therefore based upon a theory of aggregation. The propositionwas that a physiological change, which is not damage that alone attracts compensation, couldbe aggregated with risk and anxiety (neither of which would by themselves give rise to acause of action) to create a cause of action.

Since these decisions, claims have regularly been settled on the basis that pleural plaquesare actionable injury. As Lord Rodger observed:

‘‘79. For about twenty years pleural plaques have been regarded as actionable. Courtshave awarded damages for them. Employers and their insurers have settled manyclaims for damages for them. Even though this has not resulted in an unmanageableflood of claims, in the present cases the defendants and their insurers have taken astand. They wish to close the gates by establishing that asymptomatic plaques arenot actionable.’’

7[1984] 134 N.L.J. 6238At p.6 of the judgment—a transcript of which remains available.9The Times, March 23, 1984.A full transcript of the judgment remains available.

10[1987] CLY 1194. A full transcript of the judgment remains available.



The certainty of this historical state of affairs and the resolution of difficult causation issuesin relation to malignant diseases11, resulted in the research finding that asbestos cases were theleast risky of employer’s liability disease claims. These claims failed hardly more often thanemployer’s liability accident cases12 such that they only justified a success fee of 27.5 per centto achieve the cost neutrality upon which conditional fee agreement funding was predicated,which figure is now enshrined in the Civil Procedure Rules.13

In 2004, parts of the insurance industry decided to challenge this status quo. In Grieves vF.T. Everard & Sons,14 10 test cases were selected for trial before Holland J., before whomthe claims succeeded. On appeal in seven of those cases, in Rothwell v Chemical & InsulatingCo Ltd,15 the Court of Appeal, by majority, allowed the appeals and the claims failed. Beforethe House of Lords, in Johnston v NEI International Combustion Ltd,16 four remaining casesfailed to overturn the decision of the Court of Appeal.

The successful insurers have claimed costs of £1.9m after the event from insurers who hadbacked the successful trials at first instance. The impact of the result on the ATE market,and on the insurability of disease claims in the future remains unclear, but the effect onaccess to justice will be substantial. Before analysing the reasoning and considering the widerimpact, it may be material to note that in these 13 claims, heard by 12 judges, seven ofwhom were or became Law Lords, three of whom were or became Lord Justices, and two ofwhom were puisne judges, five found in favour of the claimants and seven found against.17

Moreover, if ultimately it is a question of fact and degree to decide in any given case whetherthe threshold of actionability has been passed, it may be noteworthy that the first instancejudges of the facts unanimously found in favour of actionability. Political and philosophicalquestions arise as to whether issues such as this, affecting so many thousands of people thatthe insurance industry has estimated that the decision of the House of Lords may have savedit £1.5 billion,18 should be decided by such narrow margins in the courts, or despite beingquestions of fact and degree, should be conclusively determined by appellate judiciary, ratherthan being considered by Parliament and becoming the subject of legislation.

The House of Lords’ decision

Injury or not an injury?

Although the decision of the House of Lords was unanimous to the effect that the appellantclaimants should not succeed, extracting a clear ratio of what was decided is far from easy.

Lord Hoffmann reasoned it thus (the emphasis is that of the writer):

11See Fairchild v Glenhaven Funeral Services Ltd [2003] 1 A.C. 32 and Barker v Corus UK Plc [2006] 2 A.C. 572.12Fenn and Rickman’s unpublished research on calculating reasonable success fees in employer’s liability disease claims,

commissioned by the Department of Constitutional Affairs to inform the mediation process that led to the fixing ofsuccess fees in these cases.

13CPR Pt 45.23(3)(c) and 45.24(2)(a).14[2005] E.W.H.C. 88, QB.15[2006] E.W.C.A., Civ 27.16[2007] U.K.H.L. 39.17The cases and judges referred to are: Church (Peter Pain J.); Sykes (Otton J. subsequently Otton L.J.); Patterson (Simon

Brown J. subsequently Lord Simon Brown) along with the 10 claimants in Grieves heard by Holland J. at first instance,the seven cases which proceeded to the Court of Appeal in Rothwell heard by Phillips M.R. (subsequently Lord PhillipsC.J.), Longmore and Smith L.JJ. and the four cases which went to the Lords in Johnston heard by Lords Hoffmann,Hope, Scott, Rodger and Mance.

18Stewart Douglas writing in Insurance Daily, October 18, 2007 citing an actuarial report commissioned prior to thecommencement of this test case litigation.



‘‘10. Holland J found that the plaques in themselves were not damage which could founda cause of action. He said (at para 80a): ‘‘I start by rejecting any notion that pleuralplaques per se can found a cause of action. I am not satisfied that for forensic purposes theycan be categorised as a ‘disease’ nor as an ‘impairment of physical condition’.’’

‘‘11. This finding of fact is in my opinion unassailable. As the judge noted, the pointwas conceded by the claimants, who preferred to rely upon the aggregation theoryadopted by Simon Brown J in Patterson v Ministry of Defence. The same concessionwas made in the Court of Appeal but withdrawn in the House of Lords. . . . Ido not see how it was open to the judge, on the evidence, to come to any otherconclusion. . . . The important point was that, save in the most exceptional case,the plaques would never cause any symptoms, did not increase the susceptibility ofthe claimants to other diseases or shorten their expectation of life. They had no effectupon their health at all.’’

‘‘12. If the pleural plaques are not in themselves damage, do they become damagewhen aggregated with the risk which they evidence or the anxiety which that risk causes?In principle, neither the risk of future injury nor anxiety at the prospect of future injury isactionable. These propositions are established by the decisions of the House in Gregg vScott19 . . . and Hicks v Chief Constable of the South Yorkshire Police20 . . . respectively.How then can they be relied upon to create a cause of action which would nototherwise exist?’’

‘‘19. . . .. One is not concerned with whether the plaque is in some sense ‘‘injury’’or (as she went on to decide) a ‘‘disease’’. The question is whether the claimant hassuffered damage. That means: is he appreciably worse off on account of having plaques?The rare victim whose plaques are causing symptoms is worse off on that account.Likewise, the man with the disfiguring lesion is worse off because he is disfigured.In the usual case, however (including those of all the claimants in these proceedings)the plaques have no effect. They have not caused damage.’’

Is he saying that pleural plaques are an injury that is not actionable (para.19), or is hesaying that they are not an injury at all (paras 10 and 11), or is he sidestepping the dichotomy(para.19)? The answer is not clear, but the conclusion is that they are not a legal, that is,actionable, injury.

Lord Scott reasoned differently (the emphasis is that of the writer):

‘‘62. None of the appellants has yet contracted any asbestos related disease.’’

‘‘65. . . . a cause of action in tort for recovery of damages for negligence is notcomplete unless and until damage has been suffered by the claimant. Some damage,some harm, some injury must have been caused by the negligence in order to completethe claimant’s cause of action.’’

‘‘68. . . . The judge’s conclusion, concurred in by all the members of the Courtof Appeal, that pleural plaques could not be characterised as a disease or as animpairment of physical condition was in part a finding of fact but also a conclusionof law. . . . The facts, however, lead inevitably in my opinion to the conclusion

19[2005] 2 A.C. 176.20[1992] 2 All E.R. 65.



reached by the judge. Pleural plaques are not visible or disfiguring. None of theappellants suffered from any disability or impairment of physical condition caused by thepleural plaques. The plaques were asymptomatic and were not the first stage of any asbestosrelated disease. The inhalation of the fibres and the formation of the plaques involvedno pain or physical discomfort. Those being the facts the conclusion that thepresence of pleural plaques could not per se suffice to complete a tortious cause ofaction in negligence is, in my opinion, unassailable.’’

‘‘71. . . . A scar or lesion on the skin may constitute a tortiously relevant injurybecause it is disfiguring. A lesion hidden within the body is plainly not of thatcharacter.’’

The clear conclusion reached is that pleural plaques are not an injury, and that isdeterminative of the issue of actionability.

Lord Hoffmann does not pass comment on the speeches of others. Lord Scott purportsto agree inter alia with the opinion of Lord Hoffmann.21 They do not appear to say thesame thing even though they concur as to the result. Lord Mance agrees however with bothspeeches.22 He says (the emphasis is that of the writer):

‘‘103. More specifically, I agree with the reasons given in the opinions of my nobleand learned friends, Lord Hoffmann, Lord Scott of Foscote and Lord Rodger ofEarlsferry, for concluding that the pleural plaques did not by themselves constitute orinvolve injury and damage sufficient to enable an action to lie in tort and that such injuryand damage cannot in law be found by ’aggregating’ the pleural plaques, the riskof future asbestos-related disease and/or the anxiety experienced in relation to suchrisk, in circumstances where none of such factors alone will suffice.’’

Is he agreeing with Lord Scott that there is no injury, or is he interpreting the speech ofLord Hoffmann as to the same effect, thereby enabling him to agree with both of them? Ifhowever, that is not the proper interpretation of the speech of Lord Hoffmann, surely hecannot be agreeing the reasons of Lord Scott.

Lord Hope however appears to accept that pleural plaques are an injury but not one thatis sufficiently serious to pass the threshold of actionability. He reasoned it thus (the emphasisis that of the writer):

‘‘38. . . . The pathological process that gives rise to them is such that pleural plaquesmay be described as a disease or an injury. But they do not normally give rise toany physical symptoms. They may become more extensive. But they do not inthemselves give rise to, or increase the risk of developing, any other asbestos inducedconditions. The appearance of the pleura is altered. But this is detectable only byway of chest X-ray or CT scan or, after death, by autopsy. There is no cosmeticdeficit. Their physical effects cannot, in any normal sense of the word, be describedas harmful. In essence, they are only indicators. They do no more than evidenceexposure to asbestos.’’

21Judgment para.[74].22Judgment paras [102] and [103].



‘‘39. . . . There must be real damage, as distinct from damage which is purely minimal. . .. . Where that element is lacking, as it plainly is in the case of pleural plaques, thephysical change which they represent is not by itself actionable.’’

‘‘49. . . . while the pleural plaques can be said to amount to an injury or a disease, neitherthe injury nor the disease was in itself harmful. . . . Pleural plaques are a form of injury.But they are not harmful. They do not give rise to any symptoms, nor do they leadto anything else which constitutes damage.’’

‘‘59.. . . But they have not yet sustained an injury for which the law can give thema remedy in damages.’’

Lord Rodger sidesteps the issue, concluding that:

‘‘88. . . . Taken by themselves, however, the plaques are benign and asymptomatic.So, even assuming that the plaques could constitute a relevant ‘injury’ to theclaimants’ bodies, they do not cause them any material damage and so do not giverise to a cause of action.’’

It seems to the writer Lord Scott clearly holds there to be no injury, but Lord Hope clearlyholds there to be an injury, but one that is de minimis and does not cross the threshold intoactionability. In purporting to agree with the speech of Lord Hoffmann, it is implicit thatLord Scott believes that Lord Hoffmann is holding there to be no injury, and in agreeing withthe speeches of both of them, implicitly so does Lord Mance. Lord Rodger assumes therecould be an injury without expressing a concluded view on the issue. There is therefore oneclear and two equivocal findings of ‘‘no injury’’ which appears therefore to be the majorityview.

Cause of action in contract

The search for a ratio on the above dichotomy is relevant to wider issues. Lord Scott says:

‘‘74. . . . Each of the appellants was employed under a contract of service. Eachof the employers must surely have owed its employees a contractual duty of care,as well as and commensurate with the tortious duty on which the appellants basedtheir claims. It is accepted that the tortious duty was broken by the exposure ofthe appellants to asbestos dust. I would have thought that it would follow that theemployers were in breach also of their contractual duty. Damage is the gist of anegligence action in tort but damage does not have to be shown in order to establisha cause of action for breach of contract. All that is necessary is to prove the breach.The amount of damages recoverable, once the breach of contract has been proved,is subject to well known rules established by the leading cases and, applying theserules, it might well be arguable that the breach of a contractual duty to provide a safeworking environment for employees, an environment where reasonable precautionshad been taken to avoid their exposure to injurious asbestos dust, would justify anaward of contractual damages to compensate the employees for subjecting themto the risk of contracting in the future a life-threatening asbestos related disease.Damages for breach of contract should, in principle, compensate the victim forbeing deprived of the contractual benefit to which he was entitled. However these



are matters that have not been debated at all, either before your Lordships or inthe courts below. Mr Burton QC made expressly clear in the course of the hearingof this appeal that the appellants’ claims were based on tort and not on breach ofcontract. In the absence of claims based on contract and submissions from counselabout the possibilities and limitations of such claims, my speculation as to whethercontractual damages claims by the appellants might have been viable can be takenno further. I would, however, observe that sections 11 and 14 of the Limitation Act1980, which apply to negligence actions for damages for personal injuries, not onlyapply to actions based on breach of a tortious duty of care but can surely apply alsoto actions based on breach of a contractual duty of care.’’

Lord Hope agreed, saying that:

‘‘59. . . . The question whether employees might have a remedy against theiremployers in contract has not been explored in the present context, as my nobleand learned friend Lord Scott of Foscote points out. There may be room fordevelopment of the common law in this area.’’

Lord Mance also agreed, saying that:

‘‘105. . . . I also note that the scope of an employers’ contractual liability mightrequire examination in another case, but it has not and cannot be examined in thiscase.’’

Other commentators agree.23 There are several reasons why this writer questions thatconclusion.

First, if, which is not clear for the reasons analysed above, the ratio is that there is no injuryin these cases, then the cause of action in contract is not an action ‘‘in respect of personalinjuries’’ within the meaning of s.11 of the Limitation Act 1980. As such it does not benefitfrom the date of knowledge relaxation of the primary limitation periods in contract or tort,and the primary contractual limitation period of six years from date of breach will continueto apply.24 If that is the case, then in respect of the pleural plaques, any contractual right ofaction becomes statute barred six years after the cessation of the defendant’s exposure of theclaimant in breach of duty. Only if either the decision of the House of Lords is to the effectthat pleural plaques are an injury but are not actionable as such, or a later Supreme Court (asby then the House of Lords will have become) in a contract action engages in ‘‘not so muchreinterpreting as rewriting the key decisions’’,25 can this conclusion be avoided.

Secondly, other problems beyond the scope of this article exist in relation to makingalternative claims in contract, including but not limited to whether the policy wording ofusual employer’s liability indemnity insurance policies would cover such claims, whetherprovisional damages would be available, and whether damages for pain and suffering and lossof amenity would be available.

23See for example Colin McCaul Q.C.: Plaques are back: New Law Journal, November 9, 2007, p.1564.24The Limitation Act 1980 s.5 provides that, ‘‘An action founded on simple contract shall not be brought after the

expiration of six years from the date on which the cause of action accrued.’’ The cause of action is the relevant breachand not the time of damage: see Gibbs v Guild [1881] 8 QBD 296 .

25Lord Rodger’s description in Barker v Corus UK Plc [2006] 2 A.C. 572 at [71] of the reasoning of the majority aboutthe earlier decisions of the House of Lords in Fairchild v Glenhaven Funeral Services Ltd [2003] 1 A.C. 32 and McGhee vNational Coal Board [1973] 1 W.L.R. 1.



What is actionable?

Lord Hoffmann opined (the emphasis is that of the writer):

‘‘7. Some causes of action arise without proof of damage. Trespass and breach ofcontract are examples. Proof of the trespass or breach of contract is enough tofound a cause of action. If no actual damage is proved, the claimant is entitled tonominal damages. But a claim in tort based on negligence is incomplete withoutproof of damage. Damage in this sense is an abstract concept of being worse off, physicallyor economically, so that compensation is an appropriate remedy. It does not mean simplya physical change, which is consistent with making one better, as in the case of asuccessful operation, or with being neutral, having no perceptible effect upon one’shealth or capability.’’

‘‘8. How much worse off must one be? An action for compensation should not beset in motion on account of a trivial injury. De minimis non curat lex. But whetheran injury is sufficiently serious to found a claim for compensation or too trivial tojustify a remedy is a question of degree.’’

‘‘19. It seems to me, with respect, that Smith LJ asked herself the wrong question.One is not concerned with whether the plaque is in some sense ‘‘injury’’ or (as shewent on to decide) a ‘‘disease’’. The question is whether the claimant has suffereddamage. That means: is he appreciably worse off on account of having plaques? The rarevictim whose plaques are causing symptoms is worse off on that account. Likewise,the man with the disfiguring lesion is worse off because he is disfigured. In the usualcase, however (including those of all the claimants in these proceedings) the plaqueshave no effect. They have not caused damage.’’

Lord Hope agreed, saying (the emphasis is that of the writer):

‘‘39. . . . There must be real damage, as distinct from damage which is purely minimal. . . . Where that element is lacking, as it plainly is in the case of pleural plaques,the physical change which they represent is not by itself actionable.’’

‘‘47. . . . In strict legal theory a wrong has been done whenever a breach of theduty of care results in a demonstrable physical injury, however slight. But the policyof the law is not to entertain a claim for damages where the physical effects of theinjury are no more than negligible. Otherwise the smallest cut, or the lightest bruise,might give rise to litigation the costs of which were out of all proportion to whatwas in issue. The policy does not provide clear guidance as to where the line is tobe drawn between effects which are and are not negligible. But it can at least besaid that an injury which is without any symptoms at all because it cannot be seen or felt andwhich will not lead to some other event that is harmful has no consequences that will attractan award of damages. Damages are given for injuries that cause harm, not for injuries that areharmless.’’

Lord Scott also agreed, saying:

‘‘65. . . . First, a cause of action in tort for recovery of damages for negligenceis not complete unless and until damage has been suffered by the claimant. Some



damage, some harm, some injury must have been caused by the negligence in orderto complete the claimant’s cause of action.’’

‘‘68. . ... The facts, however, lead inevitably in my opinion to the conclusionreached by the judge. Pleural plaques are not visible or disfiguring. None of theappellants suffered from any disability or impairment of physical condition causedby the pleural plaques. The plaques were asymptomatic and were not the first stageof any asbestos related disease. The inhalation of the fibres and the formation ofthe plaques involved no pain or physical discomfort. Those being the facts theconclusion that the presence of pleural plaques could not per se suffice to completea tortious cause of action in negligence is, in my opinion, unassailable.’’

Lords Rodger and Mance clearly also agreed.Therefore, the unanimous conclusions of the House of Lords were that:

• Actionable damage requires there to be some harm or detriment, which requirement is notsatisfied in respect of invisible physical changes that cause no symptoms, do not progressand do not lead in themselves to other serious consequences.

• Aggregating those changes whether with each or both of:

• risk of other serious diseases developing independently in the future; and• anxiety, even if genuine and foreseeable, as to future health and welfare, but falling

short of frank psychiatric illness,

is impermissible and does not complete the cause of action because each constituentelement on its own does not constitute actionable damage.26

W(h)ither pleural thickening?

Mr Rothwell had been diagnosed as exhibiting pleural thickening as well as pleural plaques,upon re-examination shortly before trial at first instance, but there was no dispute that bothconditions were symptomless.27 By virtue of the ruling of the House of Lords as to what wasactionable damage, he therefore also failed to establish liability.

However the writer submits that the result may require revisiting in future cases wherethe medical evidence has addressed the new test delineating the border of actionability. Tworeasons are suggested for that conclusion.

First, since none of the cases sought to litigate actionability of symptomless pleuralthickening, there was no generic medical evidence as to its causes,28 or as to the waysand frequency with which it progresses to cause symptoms. Accordingly, there was neitherevidence nor submission as to on which side of the retained dividing line represented byCartledge v E. Jopling & Sons Ltd29 cases of symptomless pleural thickening fell. The House

26For that reason, the decisions of Peter Pain J. in Church, Simon Brown J. (as he then was) in Patterson and Holland J. inGrieves, together with the minority views of Smith L.J. in Rothwell all of which were in one way or another based onwhat was referred to by the House of Lords as the ‘‘aggregation theory’’ are now to be regarded as wrong in law.

27For the detail, see the judgment of Lord Phillips L.C.J. in Rothwell at [3].28Is pleural thickening scarring that is or may be the consequence of bouts of asbestos pleurisy, and if and insofar as such

pleurisy does cause symptoms, is that actionable ‘‘harm’’?29[1963] A.C. 758.



of Lords were unanimous in neither criticising the conclusions or reasoning in Cartledge, norseeking to limit its ambit or effect. Lord Hoffmann in Johnston put it as follows (the emphasisis that of the writer):

‘‘8. . . . Because people do not often go to the trouble of bringing actions torecover damages for trivial injuries, the question of how trivial is trivial has seldomarisen directly. It has however arisen in connection with the Limitation Act, underwhich the primary rule is that time runs from the date on which the cause ofaction accrues. In an action for negligence, that means the date upon which theclaimant suffered damage which cannot be characterised as trivial. To identify thatmoment was the vital question in Cartledge v E. Jopling & Sons Ltd . . ., in which theemployees had suffered death or serious injury from damage to their lungs causedby exposure to fragmented silica. At a date earlier than the commencement of thelimitation period their lungs had suffered damage which would have been visible upon anX-ray examination, reduced their lung capacity in a way which would show itself in cases ofunusual exertion, might advance without further inhalation, made them more vulnerable totuberculosis or bronchitis and reduced their expectation of life. But in normal life the damageproduced no symptoms and they were unaware of it.’’

Secondly, emerging research may be associating pleural thickening with the developmentof peritoneal mesothelioma30 in which case on that ground it may constitute harm in thenew sense.

W(h)ither asbestosis?

Concession was made by the insurers in Rothwell31 that:

‘‘Asymptomatic asbestosis and pleural thickening are, for the purpose of theseactions alone, accepted to be compensatable. The reason for this is that the diagnosiscannot be made without characteristic lesions in the lung being seen. Those lesionsrequire a heavy dose of exposure. These two considerations lead to the followingassumptions: a person with heavy exposure has a significant increased risk of bothasbestos-related malignancy and of advancement of the insipient seizures which havejust been diagnosed i.e. the asbestosis or pleural thickening. As was explained byLord Pearce the reason why an asymptomatic condition can be compatible with thesuffering of real injury (and hence actionable injury) is that at first what is destroyedis ‘spare’ lung capacity. However at some stage the (at present) asymptomatic injurywill progress so as to destroy sufficient lung capacity so as to cause symptoms oneven light exertion. There is thus existing loss of faculty. Compare this to PP whichcan (almost) never advance so as to give rise to symptoms. Whereas the otherconditions are apt to advance, PP are an aetiological cul-de-sac. Put another way,asbestosis, diffuse pleural thickening (and since it is relied upon by C) silicosis maybe asymptomatic in their early stage, but that is merely a stage preparatory to thecausation of symptoms.’’

30Reid et al, ‘‘The additional risk of malignant mesothelioma in former workers and residents of Wittenoom with benignpleural disease or asbestosis’’ in Occupational and Environmental Medicine 665 (BMJ Publishing Group Ltd, 2005).

31Michael Kent Q.C. for the insured defendants in the Appellant Defendants’ Skeleton Argument before the Court ofAppeal.



However, in Owen v Esso Exploration & Production UK Ltd,32 Judge Stewart Q.C. found asfollows:

‘‘25. There is no doubt that, without reference to the risk of progression tosymptomatic pleural thickening and/or asbestosis, the Claimant’s condition inthe present case is worse than in the case of Rothwell. The fibroses constitutingpleural thickening and asbestosis tend to reduce lung capacity (cf Rothwellpara.70). They are not merely evidence of a degree of exposure to asbestos.

26. However there is not before me any evidence, as there was in Cartledge, thatthe injured condition of the lungs is advanced, the scarring extensive or thatthe damage is such that it is sufficient to diminish appreciably the elasticity ofthe lungs and deprive them of much (or indeed any) of their reserve capacity.

27. The problem which Mr Owen has is that (save for the risk of progressionto which I shall turn later in this judgment) he has not proven that hisasymptomatic pleural thickening and/or asbestosis has actually affected thereserve capacity of his lungs to any extent whatsoever.. . .

28. In summary the Claimant has not proven anything more than asymptomaticfibrosis which may possibly (but not proven on the balance of probabilities)have affected his reserve capacity. Nor has he proved that there is any significanteffect on the elasticity or functioning of the lung tissue. I must make it clearthat this is by no means to say that asymptomatic asbestosis and/or pleuralthickening can never give rise to a cause of action. Evidence of significanteffect in the reserve capacity and/or the elasticity of the lung tissue in anothercase may well yield an entirely different finding.’’

Better evidence in future cases specifically addressing the nature, effect on lung capacity,and progression of asbestosis is likely, in the writer’s submission, to result in symptomlessasbestosis being held to be actionable harm. It remains to be seen whether the Court ofAppeal will so hold in this case on the above evidence. It is submitted that it should, because,to paraphrase Lord Scott, this appellant has already contracted an asbestos related disease,33

and is at the first stage of an asbestos related disease.34 Otherwise, Owen should be regardedas a decision on its own facts, recognising that the medical evidence before the court did notaddress the questions of effect on elasticity of the lung or on reserve lung capacity.

Nervous shock

One of the appellant claimants (Mr Grieves) suffered frank psychiatric illness (clinicaldepression) as a result of being told that his pleural plaques indicated a significant exposure toasbestos and of the risk of future malignant disease. Not only did the House of Lords hold thatsuch was not reasonably foreseeable to the reasonable employer at the time of the exposurein breach of duty, and therefore not actionable,35 but it also held that any such illness was not

32[2006], unreported, November 16, 2006, Liverpool County Court. Permission to appeal to the Court of Appeal wasgranted by Judge Stewart but the appeal was stayed by consent by Smith L.J. pending the decision of the House of Lordsin Johnston.

33Johnston at [62].34Johnston at [68].35Per Lord Hoffmann at [30] and Lord Hope at [55] and Lord Scott at [77] and Lord Rodger at [100].



caused by the exposure or therefore the breach of duty, but rather by the communication 20years later that the claimant was at risk of future serious illness.36

As was observed by Lord Hoffmann37 :

‘‘33. In the present case, the foreseeable event was that the claimant would contractan asbestos-related disease. If that event occurred, it could no doubt cause psychiatricas well as physical injury. But the event has not occurred. The psychiatric illnesshas been caused by apprehension that the event may occur. The creation of such arisk is, as I have said, not in itself actionable. I think it would be an unwarrantedextension of the principle in Page v Smith38 to apply it to psychiatric illness causedby apprehension of the possibility of an unfavourable event which had not actuallyhappened.’’

Lord Hope put it as follows:

‘‘54. . . . The category of primary victim should be confined to persons who sufferpsychiatric injury caused by fear or distress resulting from involvement in an accidentcaused by the defendant’s negligence or its immediate aftermath. A person like MrGrieves who suffers psychiatric injury because of something that he may experiencein the future as a result of the defendant’s past negligence is in an entirely differentcategory. The immediacy that is characteristic of the situation that applies to primaryvictims as contemplated in Page v Smith . . . is lacking in his case.’’

Limitation

The writer submits that Lord Hope was correct in saying:

‘‘50. . . . I would hold however that there is no cause of action because the pleuralplaques in themselves do not give rise to any harmful physical effects which canbe said to constitute damage, and because of the absence of a direct causative linkbetween them and the risks and the anxiety which, on their own, are not actionable.I would apply the same proposition for the purposes of the limitation rules. Timehas not yet begun to run against any of the claimants who may have the misfortuneof developing an asbestos-related disease in the future which is actionable.’’

Accordingly, a finding of pleural plaques communicated to a patient does not set timerunning against them for the purposes of limitation. There may still be litigation. As Dr Ruddobserved in giving evidence in Grieves:

‘‘Different experienced readers looking at the same scans . . . will disagree witheach other in a proportion of cases. On CT scans that proportion is usually around5 per cent. That was shown in one of our studies, whereas on plain x-rays it maybe as high as 20 to 30 per cent disagreement as to whether one is looking at plaquesor diffuse thickening . . . It is easy to pick a series of cases in which no-one woulddisagree, but the usual run of cases will include some which are more difficult

36Per Lord Hoffmann at [33] and Lord Hope at [53] and Lord Rodger at [95].37Judgment para.[30].38[1996] A.C. 155.



and in any large series there will be inter observer disagreement and even intraobserver disagreement, meaning that the same observer looking at them on differentoccasions may reach different conclusions.’’

Therefore, one can anticipate limitation disputes hinging on whether a given case at agiven time showed pleural plaques (such that time did not start to run and a subsequent claimwas not statute barred) or diffuse pleural thickening that was actionable (such that time startedto run leaving the current claim statute barred).

Another fertile area for future litigation is to ask in what circumstances might those whohave in the past successfully claimed full and final awards of damages for symptomless pleuralplaques which are now declared to have been non-actionable, be able to claim damages formalignant disease that has developed subsequently.

Legislative intervention

Lord Hope said:

‘‘59. I share the regret expressed by Smith LJ that the claimants, who are at riskof developing a harmful disease and have entirely genuine feelings of anxiety as towhat they may face in the future, should be denied a remedy.’’

But the Government response from Bridget Prentice MP, Parliamentary Under Secretaryof State, Ministry of Justice, has been to say39:

‘‘The House of Lords considered the issues very thoroughly on the basis of allthe evidence put before them and reached the unanimous decision that pleuralplaques do not constitute actionable or compensatable damage. Having consideredthe judgment very carefully, the Government have decided that it would not beappropriate to legislate on the issue.’’

Scotland may lead in a different direction, although Alex Salmond, the First Minister isreported to have said: ‘‘As the ruling was in the context of an English Appeal, it is notbinding at the present moment in Scotland’’40

He may not have been aware that two months earlier, Lord Uist in Wright v StoddardInternational Plc41 anticipated that the decision of the House of Lords would in fact bedeterminative of this issue and by supplementary opinion he decided42 that pleural plaquescaused no harm and were not actionable, in conformity with the House of Lords’ decision.The Scottish Justice Secretary Kenny MacAskill announced the following on November 29,2007:43

‘‘The effects of asbestos are a terrible legacy of Scotland’s industrial past and weshould not turn our backs on those who contributed to our nation’s wealth inthe past. Pleural plaques in anyone exposed to asbestos mean they have a greatly

39Hansard, November 13, 2007.40Reported by Jon Robins in ‘‘Deadly decision?’’: The Gazette, November 8, 2007 p.22.41[2007] C.S.O.H. 138 at [156]–[157].42[2007] C.S.O.H. 173 at [159]–[161].43http://www.scottishexecutive.gov.uk/News/Releases/2007/11/29102156 [Accessed January 7, 2008].



increased lifetime risk of developing mesothelioma and a small but significantlyincreased risk of developing bronchial carcinoma. This will mean that peoplediagnosed with this condition will have to live with the worry of possible future illhealth for the rest of their lives. That is why this Scottish Government is to takesteps to reverse the House of Lords Judgment and ensure that people with pleuralplaques can continue to raise an action for damages. We have listened to the manyvoices who have campaigned on behalf of asbestos sufferers. This Government takesthis issue very seriously and I hope this move will bring some relief to people livingwith this condition.’’

It remains to be seen whether the twin spectre of forum shopping, and the fact that claimsmay become possible in Scotland against Scottish defendants which are denied to Englishclaimants or against English defendants, may cause the Government to reconsider its stance.


Liability for Sporting Injuries

BRUCE GARDINER1

Causation; Causes of action; Defences; Duty of care; Personal injury;Sporting events; Sports

Abstract

Bruce Gardiner reviews the case law on liability for sporting injuries. He considers theextent to which other competitors, referees, organisers and governing bodies can beheld liable for such injuries. He looks at likely defences and provides practical advice onhow such claims should be litigated. ML

Introduction

In the motorsport case of Stratton v Hughes, unreported, March 17, 1998, Swinton ThomasL.J. said the following:

‘‘Many sports, such as motor racing, rafting, mountaineering, rock climbing andmany others have innate dangers. That is part of their appeal’’

Those injured by dangerous sports are increasingly appealing to the legal process as a sourceof potential compensation. This article discusses the circumstances in which such litigationhas a reasonable prospect of success, and the tactics to adopt.

Duty

The first question is, ‘‘Who can the action be brought against?’’ There are a number ofpossibilities.

Competitors

Competitors may be liable to other competitors for the manner in which they play the game.Condon v Basi [1985] 1 W.L.R. 866 was the first case to consider whether one participant

1Bruce Gardiner is a barrister in Chambers at 2 Temple Gardens, London, EC4Y 9AY. He can be contacted by telephoneon 020 7822 1200 and by e-mail at [email protected].


LIABILITY FOR SPORTING INJURIES

may owe a duty of care to another. Mr Condon broke his leg when tackled by Mr Basiduring a fiercely fought football game between Whittle Wanderers and Khalsa Football Club inthe Leamington League. In his report of the game, the referee described the tackle as reckless.Sir John Donaldson M.R. considered that in a contact sport such as football, each participantowes the others a duty to take reasonable care in all the circumstances:

‘‘[. . .]which, in a game of football, are quite different from those which affect youwhen you are going for a walk in the countryside’’.

Mr Basi had been found liable at first instance, and that decision was upheld on appeal.Debate in recent cases has focused on the extent of that duty. Perhaps the clearest recent

statement of principle is that approved by the Court of Appeal in Caldwell v Maguire andothers [2001] EWCA, Civ 1054. This was a case in which a professional jockey was seriouslyinjured whilst riding in a two-mile novice hurdle at Hexham. He brought a claim against twoother professional jockeys. The Court of Appeal approved five principles set out by HollandJ. at first instance. The first three emphasised the importance of considering all the prevailingcircumstances and then continued:

‘‘4. Given the nature of such prevailing circumstances, the threshold for liability isin practice inevitably high; the proof of a breach of duty will not flow from proofof no more than an error of judgment or from mere proof of a momentary lapse ofskill (and thus care) respectively when subject to the stresses of a race. Such are nomore than incidents inherent in the nature of the sport.’’

‘‘5. In practice it may therefore be difficult to prove any such breach of dutyabsent proof of conduct that in point of fact amounts to reckless disregard for thefellow contestant’s safety. I emphasise the distinction between the expression oflegal principle and the practicalities of the evidential burden.’’

In that case there had been a stewards’ enquiry at which the two defendants were foundguilty of careless riding. Notwithstanding that finding, the claim failed because the momentarycarelessness was regarded as nothing more than an error of judgment of which any participantmight be guilty in the context of a race of this kind.

However, in appropriate circumstances there will be a finding of liability. In two casesrugby players injured by ‘‘spear tackles’’ have recovered from their fellow players. In theAustralian rugby league case of Jarrod McCracken v Melbourne Storm Rugby League Club [2005]N.S.W.S.C. 107, the judge had to consider an injury caused by such a spear tackle, whenthe claimant was lifted off the ground and allowed to fall headfirst into the ground. Thejudge reminded himself that the tackle occurred in a matter of seconds in the context ofa fast-moving, intense physical contest, involving heavy bodily collisions by defenders onattackers. However, he considered that the pair tackling had been aware of what the otherwas doing and had lifted and upended the claimant intending that he should fall heavilyonto the ground. Accordingly, the judge found that the defendants (and their employervicariously) had breached their duties of care to the claimant. A similar finding of liabilitywas made in the earlier English schoolboy rugby union case of Ramsay Elshafey v Javed Clayunreported, April 6, 2001, QBD as a result of a similar tackle.

One issue which remains unclear is whether an experienced professional player may owea higher standard of care than a less experienced amateur. In Condon v Basi (supra) Sir JohnDonaldson M.R. said that:



‘‘there will of course be a higher degree of care required of a player in a FirstDivision football match than of a player in a local league football match’’

In Vowles v Evans [2003] 1 W.L.R. 1607 (a referees case), Lord Phillips M.R. was morecircumspect–he regarded the point as one where there was ‘‘scope for argument’’. Where theteams are of a similar standard this issue may not make much practical difference, but a claimarising out of injuries suffered in an early round of the FA Cup between a Premiership sideand perhaps lower league or non-league opposition may require this issue to be fully argued.

Even informal horseplay is subject to the same approach as well established sports. In Blakev Galloway [2004] 3 All E.R. 315, members of a string quartet rehearsing for a concertdecided to let off steam during their lunch break by throwing pieces of bark chipping at eachother. One participant was injured when a piece of bark struck him in the eye. His claimagainst the culprit failed because the chipping had been thrown in accordance with the tacitconventions of the game and had not been deliberately aimed at his head.

In that case the injured participant had also brought a claim in battery. That claim alsofailed. By participating in the game, the claimant had to be taken to have impliedly consentedto the risk of a blow on any part of his body.

It is arguably even more difficult for a spectator to sue a competitor for injuries caused asa result of an incident in the normal course of the sporting event. The classic statement ofprinciple is that stated in Wooldridge v Sumner [1963] 2 QB 43, where a spectator was injuredat a show-jumping event. A spectator took the risk of injury unless the ‘‘participant’s conductwas such as to evince a reckless disregard of the spectator’s safety’’.

In Smolden v Whitworth [1997] E.L.R. 249, Lord Bingham L.C.J. commented that asporting competitor, properly intent on winning the contest, was (and was entitled to be) allbut oblivious to spectators. It therefore followed that he would have to be shown to havevery blatantly disregarded the safety of spectators before he could be held to have failed toexercise such care as was reasonable in all the circumstances.

In a high value claim, there may be a practical difficulty in suing another participant. Itmay be that the other participant does not have insurance and cannot afford to satisfy anyjudgment entered against him in the claimant’s favour.

Given these legal and practical difficulties of bringing an action against one of thecompetitors, an injured spectator may be more successful in bringing an action against theorganisers of the event for failing to take sufficient precautions to safeguard him.

The referee

The leading case on the liability of referees for sporting injuries is Vowles v Evans [2003] 1W.L.R. 1607. In that case the claimant was badly injured during a rugby match when thescrum collapsed, and brought an action against the referee. A prop forward had previouslyleft the field with an injury, and in breach of the rules the referee had permitted a flanker totake his place in the front row without enquiring as to his previous experience of playingprop. This decision was criticised as the negligent cause of the scrum collapse. For the referee,it was argued that there was no duty of care owed by the referee to the players, or at least byan amateur referee. The Court of Appeal rejected this argument. Lord Phillips M.R. said asfollows:

‘‘Rugby football is an inherently dangerous sport. Some of the rules are specificallydesigned to minimise the inherent dangers. Players are dependent for their safety



on the due enforcement of the rules. The role of the referee is to enforce the rules.Where a referee undertakes to perform that role it seems to us manifestly fair, justand reasonable that the players should be entitled to rely upon the referee to exercisereasonable care in so doing’’ (at para.25).

However, the standard of care to be expected of the referee depends on all the circumstances,including the nature of the game. The Court of Appeal upheld the approach taken in theearlier rugby case of Smolden that the referee of a fast moving game cannot reasonably beexpected to avoid errors of judgment, oversights or lapses. In practice, ‘‘the threshold ofliability must properly be a high one’’. On the facts, that threshold had been crossed in thatcase. In practice this meant that the Welsh Rugby Football Union was vicariously liable forthe referee’s negligence.

The event organiser

It may be that an injury sustained by a participant or a spectator could have been avoided ifthe organiser of the event had taken some precaution. Given the high hurdle of suing thecompetitor or the referee, this may be a more successful route in a particular case.

Event organisers obviously owe duties of care to participants and spectators, both atcommon law, and to some extent under the Occupiers Liability Act 1957 (The 1957 Act).In the latter case, the event organiser will probably become an occupier under the 1957Act even if not the owner of the land, because the organiser has sufficient control over theactivities carried out on the land.

The occupier

The occupier may not be the same person as the event organiser. A good example is providedby Gwilliam v West Herts Hospitals NHS Trust [2002] 3 W.L.R. 1425 where the NHS Trustorganised a fundraising fair to be held in its grounds. An independent contractor ran oneof the sporting events at the fair. The NHS Trust remained in occupation of the hospitalgrounds where the fair was taking place, and accordingly continued to owe the commonduty of care under s.2(1) of the 1957 Act to visitors at the fair.

In assessing whether there is a breach of duty under the 1957 Act (as in negligence), theremust be an assessment not only of the likelihood that someone may be injured and the severityof the injury which may occur, but also the social value of the activity which gives rise to therisk and the cost of preventative measures (Tomlinson v Congleton BC [2003] 3 W.L.R. 705 at[34]). These factors have to be balanced against each other. The importance of safeguardingthe social value of the activity has now been recognised in s.1 of the Compensation Act2006. This obliges a court considering a claim in negligence or in breach of statutory duty toconsider whether a finding of liability may prevent a desirable activity from being undertakenat all, or to a particular extent or in a particular way. Most well recognised sports are likelyto qualify as desirable activities.

In Tomlinson Lord Hoffmann made it clear that there would be limits to liability:

‘‘I think it will be extremely rare for an occupier of land to be under a duty to preventpeople from taking risks which are inherent in the activities they freely choose toundertake upon the land. If people want to climb mountains, go hang-gliding orswim or dive in ponds or lakes, that is their affair.’’ (at para.45)



However, there remain circumstances in which an occupier may be found liable. Onesuch sporting case is Slack v Glenie, unreported, April 19, 2000, CA, where the owner of amotorcycle circuit being used for sidecar racing was held liable for serious injuries sustainedwhen the motorcycle and sidecar collided with a chain fence on the inside of the track, whichwas found to be an unacceptable hazard.

Poppleton v Portsmouth Youth Activities [2007] E.W.H.C. 1567 is a recent first instanceexample of a finding of liability against an occupier. The claimant had fallen from a climbingwall whilst undertaking a dangerous manoeuvre he was not sufficiently experienced toperform. The activity centre was not obliged to check his experience or provide supervisionwhilst he was climbing, but it was liable for failing to warn him of the latent danger thatthe floor matting would not cushion him from injury in the event of a fall. Had he been sowarned, he would not have attempted the manoeuvre.

Gwilliam provides an interesting illustration of the extent of the duty owed by an occupierwhen engaging independent contractors. The claimant had been injured whilst participatingin a ‘‘splat wall’’ event, when her velcro suit did not adhere to the wall and she fell to theground. The organiser of ‘‘the splat wall’’ did not have public liability insurance, and so theclaimant sued the NHS Trust as well as the event organiser, arguing that the duty under theOccupiers Liability Act 1957 extended to inquiring whether the organiser had public liabilityinsurance. In Lord Woolf’s L.C.J. view, the fact of insurance would go to their competence,and on the facts of this case the duty did require that the NHS Trust inquire into the insuranceposition. Waller L.J. reached the same conclusion, but by finding that there was an equivalentcommon law duty to enquire into the independent contractor’s ability to meet the claim.The Court of Appeal was at pains to emphasise that it was not saying that there was always aduty to check every independent contractors’ viability or insurance position, but for WallerL.J. it was the hazardous nature of the activity, which imposed this requirement in that case.

In circumstances where participants in dangerous sporting activities have been injured dueto some want of proper precautions by the uninsured event organiser, this case may providea useful basis to bring proceedings against the occupiers of the land on which the accidenthas taken place.

In Wattleworth v Goodwood [2004] P.I.Q.R. P24, the claimant had sued Goodwood RoadRacing Company, the occupier of the circuit where her husband’s fatal motor racing accidenttook place. In issue was the safety of the particular barrier with which the car had collided.The judge found that the circuit had discharged its duty as occupier by engaging expertsto advise on the safe design of the barrier and building the barrier in accordance with thatdesign. The defence provided by s.2(4) of the 1957 Act applied.

If on different facts, a circuit owner did not engage competent independent contractors toadvise on barriers, or chose to depart from the advice given, then there could be liability asoccupier.

Regulatory bodies

In order for a regulatory body to be liable for a sporting accident, that body will need tohave some essential element of control over the situation giving rise to the injury, or to haveassumed a responsibility for safe practice in relation to that situation. The leading case remainsWatson v British Boxing Board of Control [2001] 2 W.L.R. 1256. Michael Watson sustained aserious head injury during a World Boxing Organisation title fight against Chris Eubank. Theevidence showed that subsequent injuries had been significantly worsened because immediateresuscitation equipment was not available at ringside. The Board was the regulatory body,



which had sole responsibility for regulating the rules governing boxing in Britain, and as aresult had complete control over the way in which the contest was organised. Accordingly,there was sufficient proximity between the Board and a boxer and it was fair, just andreasonable for the Board to owe a duty to make regulations imposing a duty on others toensure that personal injuries already sustained were properly treated.

Lord Phillips M.R. had regard to the earlier case of Perrett v Collins [1998] 2 Lloyds Rep255, where the Court of Appeal had held that an aircraft inspector certifying that a Kit Foxaircraft was airworthy, owed a duty to those flying in the aircraft to take reasonable care inthe manner in which the inspection was carried out.

In Watson it was of some relevance to consider whether Watson had a cause of actionagainst anyone else. The Court of Appeal was more willing to find that the Board owed aduty, because in the absence of a potential remedy against the Board he had no potentialremedy against anyone at all.

That general principle stated in Watson was applied in Wattleworth v Goodwood [2004]P.I.Q.R. P25 to find that the Motor Sports Association (MSA) owed a duty of care to aparticipant killed whilst participating in a track day. The MSA is the governing body ofmotorsport in the UK. It had advised Goodwood on the suitability of a particular tracksidebarrier at the accident location so that the circuit could be granted an MSA licence tohold MSA events. Although Mr Wattleworth was not participating in an MSA event it wasreasonably foreseeable that an unsuitable barrier would cause injury to those using the circuitat any event, including a track day. It was irrelevant whether Mr Wattleworth had specificallyrelied on the fact that the circuit had an MSA track licence before participating in the event.It would have been different if the track day accident was the result of improper marshalling,because that would be outside the scope of the duty of care assumed by the MSA.

By contrast, the international motorsport governing body, the FIA, who also inspectedand approved the track, did not owe a duty of care on the facts of the particular case. Theirinvolvement was far more peripheral and their knowledge of the particular activities at thetrack was far more limited. The implication is that governing bodies may escape liabilitywhere their involvement is peripheral, and some other entity has effectively taken the lead inspecifying the necessary precautions.

However, it may be difficult to find a sports governing body liable for the inadequacy ofits in-game safety rules. In Agar v Hyde [2001] 201 C.L.R. 552, the High Court of Australiaheld that it was not fair just and reasonable for the International Rugby Football Board toowe a duty of care to all rugby players to frame the rules of rugby union football in a wayso as to minimise the risk of injury. On a practical level, it may be difficult to find expertevidence to persuade a court that the rules themselves are unsafe if those rules are formulatedand approved by the leading experts in the sport.

Employers

Where the sporting event has some connection with the claimant’s employment or with thetortfeasor’s employment, it may be possible to argue that the relevant employer is liable forthe injury.

Where there is some doubt as to whether an activity was in the course of employment, it:

‘‘. . .all depends on the closeness of the connection between the duties which, inbroad terms, the employee was engaged to perform and his wrongdoing’’ (DubaiAluminium v Salaam [2002] 3 W.L.R. 1913 at 1943 per Lord Millett).



It will not be sufficient for vicarious liability if the employment merely provides theopportunity for committing the tort. If it is established that the accident took place in thecourse of the claimant’s employment, then the employer owes a non-delegable duty to takereasonable care for the employee’s safety.

Schools

Many sports are organised by schools, and this raises the possibility that a pupil can suethe school for injuries sustained whilst participating in games organised by the school. InWoodbridge School v Chittock (2002) E.L.R. 735, a case involving a skiing accident during aschool trip, the Court of Appeal summarised the principles relevant to personal injury claimsbrought by pupils against their schools as follows. The teachers owed a duty to the claimantto show the same care in relation to him as would have been exercised by a reasonablycareful parent in all the surrounding circumstances including the teachers’ responsibilities forthe school group as a whole. It was not a duty to ensure his safety against injury from skiingmishaps such as those that might result from his own misjudgement or inadvertence whenskiing unsupervised on-piste. A range of reasonable responses applies to teachers’ decisions inrelation to their pupils’ safety.

Applying those principles, the school were held not liable for an accident sustained by apupil as a result of momentary carelessness whilst heading down a red run, leading him to falldown a slope. The same pupil had been noted skiing off-piste earlier in the holiday, but theteacher’s response to give him a severe reprimand was one of a range of reasonable options.The fact that more serious options would also have been reasonable, such as barring himfrom skiing, did not render the school liable.

Contractors

It should not be forgotten that others might owe relevant duties and so be potentially liablefor injuries caused. For example, a television production company placing a camera close tothe field of play may owe a duty of care to participants to ensure that the camera is not posinga danger.

Carriers

Where the accident occurs aboard a ship or an aircraft, the sea or air carrier is strictly liablefor all injuries or death caused, although there is a cap on the amount of compensation thatcan be recovered. For these purposes a paraglider is not an aircraft (Disley v Levine [2002] 1W.L.R. 785) but, applying the analysis in that case, a microlight probably would be. In R.v Goodwin [2006] 1 W.L.R. 546, the Court of Appeal decided that a jetski was not a ship,because it was used only for fun and not for the purpose of travelling.

It is worth noting that such carrier claims are subject to a two-year non-extendablelimitation period (Merchant Shipping Act 1995 Art.16; Carriage by Air Acts (Applicationof Provisions) Order 2004 Sch.1, Art.35). As a result, accidents aboard yachts or collisionsbetween speedboats may need to be brought promptly.



Breach of duty

The issue of breach of duty is very fact dependent. Careful preparation and good tactics canmaximise the chance of success on this issue. Often expert evidence will be crucial here, andthis requires careful selection of an expert with suitable expertise in the relevant area.

It is vital to obtain expert evidence at a sufficiently early stage to assist in the formulation ofthe pleaded case. Where the safety of a venue is in issue, an early site inspection is importantso that the expert has viewed the venue before any modifications or improvements are made.Photographs should be taken and plans prepared. On receipt of the particulars of claim,defendants will often (entirely properly) serve a detailed request for further information,seeking clarification of the precise criticisms that are being made of layout and the suggestedprecautions. It is not sufficient to say that the claimant’s position will be apparent when expertreports are exchanged. Rather than making a vague and generalised allegation, a claimantneeds to set out the case in sufficient detail so that the defendant’s expert can evaluatethe particular criticism when preparing their report. Typical examples of insufficientlyparticularised allegations in relation to motorsport cases are that a barrier was unsafe or thata run-off area was insufficient. The claimant should be asked to show on a diagram thedimensions and composition of the suggested barrier; or to create a plan of non-negligenttrack configurations.

There is tactical merit on both sides to achieving this level of detail at the outset. Forthe claimant, a cogently argued case may prompt an early settlement. For the defendant,requiring an ill prepared claimant to nail their colours to a particular case, may make it moredifficult or less convincing for the claimant to change to a potentially stronger case in duecourse.

It may be relevant to consider the extent to which similar designs are in use at othervenues to show that a criticised design is or is not standard practice (see Slack v Glenie perIan Kennedy L.J. at p.8). However, in this regard para.[111] of Watson sounds a cautionarynote—the Court of Appeal held that the judge was right to reject an argument that it wasnot negligent to fail to require resuscitation equipment at ringside given that no other boxingauthority in the world imposed such a requirement. It is also relevant to consider the safetyrequirements specified by the applicable regulatory bodies.

In certain sports, it is relevant to consider the extent to which the venue has been used overthe previous few years, the total number of previous similar accidents during that period andthe extent of injuries sustained in those accidents. It can be a potentially powerful submissionfor a defendant to show that the material accident is the first such accident in over 100,000laps of the track in an inherently dangerous activity. However, in Slack v Glenie, 80,000injury-free laps did not help the occupier to escape liability.

Defences

Contributory negligence

Mere errors of judgment will not amount to negligence. In Wattleworth there was a findingof 20 per cent contributory negligence, not for the original mistake which caused the driverto drive off the track (which was a mere error of judgment) but for his subsequent decisionto continue to apply the throttle for over 100 yards, rather than brake, given that he was onlyparticipating in a track day. The longer the distance travelled or time taken whilst making



an error of judgment, the greater the likelihood that there will be a finding of contributorynegligence.

Volenti non fit injuria

Volenti is a complete defence–where established, the claim fails totally. As a result, it hasnow been severely limited given that contributory negligence achieves a fairer outcomeby apportioning responsibility in cases where both claimant and defendant are at fault. InNettleship v Weston [1971] 2 Q.B. 691 at 701, Lord Denning M.R. stated:

‘‘Nothing will suffice short of an agreement to waive any claim for negligence.The plaintiff must agree, expressly or impliedly, to waive any claim for any injurythat may befall him due to the lack of reasonable care by the defendant : or moreaccurately, due to the failure of the defendant to measure up to the standard of carethat the law requires of him’’

So in Slack v Glenie, although the claimant knew of the existence of the infield fence closeto the track, he did not know that the lack of a clear in-field run-off constituted a hazardwhich would normally be regarded as unacceptable, and so did not consent to the resultingrisk. As a result the doctrine did not apply.

Tactically, it is sensible for defendants to plead a volenti defence where possible, if only tohighlight the inherent risks posed by the sporting activity.

Disclaimers

Often those organising dangerous sports will require participants to sign entry forms containingdisclaimers of liability, even in the event of proven negligence. Such disclaimers are of littlepractical effect, because it is not possible for the claimant to agree to exclude liability forpersonal injury or death caused by negligence (s.2(1) of the Unfair Contract Terms Act1977). However, if the accident happened abroad and foreign law applies, it is worth bearingin mind that disclaimers may be effective under that foreign law.

Causation

Causation is an important and sometimes neglected issue in a sporting injury claim. Theclaimant must show not only that they have sustained an injury, but also that it has beencaused by a proven breach of duty.

In Stratton v Hughes, unreported, March 17, 1998, CA, the organisers of a rally hadnegligently failed to extend the distance between the finish line and the stop line to 200 m;but as the accident occurred only 50m after the finish line, this negligence was not causativeof the injury. In Mountford v Newlands School [2007] E.W.C.A. Civ 21 a school was liablefor an injury sustained when the claimant was rugby tackled by a boy aged ‘‘well over 15’’taking part in an under 15’s competition. Although the tackler was physically no bigger thansome boys aged under 15, the Court of Appeal upheld the trial judge’s conclusion that theincreased risk that the ‘‘Under 15’’ rule was meant to guard against—a player’s maturity, sizeand weight—contributed materially to the injury suffered.



In some cases, a lesser injury may have occurred if the suggested precaution had been taken,and the court may need to hear medical expert evidence on the extent of the injury causedby the negligence. In this situation, causation becomes an overlap issue between accidentreconstruction and medical evidence, and it may be sensible to have a conference with bothexperts to ensure that both experts are approaching the accident in the same way.

In sporting injury cases it is often sensible to seek a split trial of liability and quantum. Ifso, it is important that the issue of medical causation is heard at the same time as liability, andthat the medical experts dealing with causation provide evidence at the liability trial in theevent that the medical evidence on causation remains in issue.

Conclusion

In many sporting contexts, the inherent dangers of the sporting activity will make it difficult toestablish liability in negligence for injuries sustained. Despite this general statement, previouscases reveal several instances of liability for sporting injuries, where defendants have been heldliable for injuries caused by avoidable rather than inherent risks. The challenge in bringingsuch claims is to correctly identify the best route to recovery and then marshall the necessaryevidence at a sufficiently early stage to maximise the chance of success.


What is a Stress-Related Injury?

CLIVE WOOD1*

Causes of action; Employers’ liability; Interpretation; Occupational stress;Personal injury claims; Psychiatric harm

Abstract

Stress-related injury at work represents a major source of lost productivity and sicknessabsence. It is also the subject of an increasing number of personal injury claims in the civilcourts. Perhaps surprisingly, there is no single definition of stress-related injury, whichwill simultaneously satisfy the medical profession, the Health and Safety Executive, tradeunions, insurance providers and the courts. Recent attempts to produce such a consensushave concentrated on damage to mental rather than physical health. Serious psychiatricimpairment, manifesting as some form of anxiety or depression seems the most likelycandidate for consensus, and is also in line with recent judgments. Additional criteriato be established will seek to clarify current concerns about the extent to which thepsychiatric injury could have been foreseen and the degree to which the employer wasnegligent. CW

Introduction

The Channel 4 website recently hosted an expert debate on the issue of ‘‘Is stress a myth?’’2

Dr Rob Briner from London University suggested that, ‘‘Many GPs will write ‘stress’ on sicknotes and we all . . . understand what someone means when they say they are stressed.’’ Hewent on to say that the problem is that:

‘‘what we are saying is effectively meaningless because . . . there is no medicalcondition or set of symptoms that can be described as, or define stress.’’ [Stress isactually] ‘‘. . . an extremely wide term referring to a huge range of different feelings,symptoms and situations.’’

1Clive Wood MSc, D.Phil is a physiologist and can be contacted at the Centre for Lifelong Learning, University ofCardiff, CF 24 4AG and by email at [email protected].

∗It is a pleasure to acknowledge most helpful discussion with Jonathan Houdmont of the University of Nottingham andHelen Miller of the University of Cardiff.

2Briner R. Is stress a myth? 4Health from Channel 4. http://www.channel4.com/health/microsites/0-9/4health/stress/aas myth.html [Accessed January 7, 2008].


WHAT IS A STRESS-RELATED INJURY?

Rejecting this contention, Roger Mead, a stress-management consultant, explained thathuman stress is, ‘‘an individual response to perceived pressure’’ and asserted that, ‘‘Individualswho are stressed will have their own understanding of what it means’’.

This widely accessible public debate on a popular website, produced specifically for patientsand their relatives, perfectly encapsulates the major discussion that has dominated medicalliterature on stress for several decades: ‘‘What is stress and can we define it?’’ Is stress a featureof individuals, of the environment in which they function, or is it rather an interaction or atransaction between the two? Perhaps the term itself is now so hopelessly confused that weshould scrap it and start again?3

After years of often sterile controversy, this crucial problem is finally receiving the criticalanalysis that it deserves, at least with regard to stress in the workplace. Ironically, the drivingforce behind this increase in clarity has not been clinical but political. Two economic drivers,legislation and litigation have prompted the most recent analysis.

Top-down and bottom-up pressures

The initial impetus was generated in the 1990s with the realisation within certain governmentcircles that sickness absence from work represented a major economic drain in terms of bothlost productivity and sickness benefit payments. Stress was seen to be a major contributor tothese losses and it should be treated in the same way as any other workplace hazard.4 TheHealth and Safety Executive (HSE) estimated the economic costs of work-related stress toemployers at over £350 million in the mid-1990s.5 Considerable publicity was given to agovernment initiative to reduce the incidence of work-related illness by 20 per cent, and thenumber of workdays lost because of it by 30 per cent, both targets to be achieved by 2010.6

The reduction of stress in the workplace was an important aspect of this comprehensiveprocess.

As part of this work-place initiative, the HSE provided a set of Management Standards7

designed to help employers to comply more precisely with their already existing legalresponsibilities with regard to the minimisation of work-related stress. The Standards describea series of aspirational organisational states to be achieved in the workplace. They relate to sixspecific work-related ‘‘stressors’’: demands, control, support, relationships, role and change.After extensive consultation and a piloting exercise carried out in some 70 organisations overa period of three years, the HSE has indicated that it now expects to see signs of clear progressin the implementation of these Standards:

‘‘From April 2007, HSE’s inspectors will be undertaking targeted follow-up activity. . . seeking evidence that action has been taken . . . using HSE’s ManagementStandards or an equivalent approach’’.8

3Pollock K. On the nature of social stress: production of a modern mythology Soc. Sci. Med., 1988; 26: 381–92.4Cousins R et al. ‘‘’Management Standards’ and work related stress in the UK: Practical development’’, Work and Stress,(2004) Vol.18, pp.113–36.

5Mackay C.J. et al. ‘‘’Management Standards’ and work-related stress in the UK: Policy background and science’’, Workand Stress (2004), Vol.18, pp.91–112.

6HSE, Securing Health Together (Sudbury: HSE Books, 2000).7HSE, Tackling stress: the Management Standards approach. (HSE Books, March 2005). Available at http://www.hse.gov.uk[Accessed January 7, 2008] and see also notes 4 and 5 above.

8HSE, Tackling Work-Related Stress in Education. (HSE Newsletter (undated)). Available at http://www.hse.gov.uk [AccessedJanuary 7, 2008].



This monitoring will occur in the pilot organisations first, and then more generally.Although the HSE have not so far been widely involved in litigation relating to stress in theworkplace, their powers to bring criminal cases against offending institutions are extensive.

In addition to this ‘‘top-down’’ pressure, which can be exerted by government agenciesunder the criminal law to encourage employers to monitor and mitigate sources of stress,a second ‘‘bottom-up’’ pressure has come from a rapidly increasing number of claims forstress-related injury, pursued in the civil courts by aggrieved employees. Not all of themmight hope to achieve a settlement of over £800,000, which was recently awarded to abank employee who suffered a ‘‘major depressive disorder’’ following a prolonged periodof bullying and abuse by her colleagues.9 However, the sheer volume of potential litigationmight cause some alarm to employers. One trade union alone assisted over 800 such claimsin 2006, and many more were settled out of court.10

A unified definition?

Any convincing demonstration that either of these legal approaches might actually reducethe prevalence or adverse consequences of stress in the workplace would seem to requiresome consensus definition of what stress actually is and what those adverse effects may be.However, no such definition currently exists that will satisfy all observers. The need is toencompass, and possibly even to unify, the seemingly disparate definitions of stress used bythe HSE, (‘‘stress is the adverse reaction people have to excessive pressure or other types ofdemand placed upon them’’)11 and the courts, (‘‘stress is not an injury: it is a state of mindthat can cause injury’’).12 This issue of definition is also of major interest to both the TradeUnions and insurance providers who shoulder much of the financial burden of litigation.

So, what is the current situation? Legal discussions of stress-related injury seem to beconfined almost entirely to mental health. Despite decades of research on the effects of stresson such physiological disturbances as hypertension, coronary disease and diabetes, causallinks have not been demonstrated with sufficient consistency to form the basis for legalaction. This problem was most recently demonstrated in a longitudinal study by Ohman andcolleagues13, who found that five years of exposure to ‘‘moderately elevated’’ levels of workstress produced no demonstrable disease, either physical or mental, compared to baselinelevels. Even after 10 years, the workers reporting the highest levels of stress showed noincrease in physical symptoms. They did, however, have a significant increase in self-reportedpsychological symptoms, mostly depression.

The Law Commission in 1998 gave some guidance on the categories of mental illness forwhich a plaintiff might seek damages.14 Grief, fear, anxiety, ‘‘or any other normal emotion’’was excluded. The courts were said to require a ‘‘recognisable psychiatric illness’’ (pp.9–10).Unfortunately, although the Law Commission gives some examples of such mental conditions(e.g. ‘‘morbid depression’’), it gives no general definition. Nor does it quote any source

9Green v D.B. Group Services (UK) Ltd [2006] E.W.H.C. 1898; [2006] I.R.L.R. 764.10Unison, personal communication, 200611HSE, Tackling stress: the Management Standards approach. (HSE Books, March 2005). Available at http://www.hse.gov.uk

[Accessed January 7, 2008].12Buchan A, ‘‘Stress cases: forseeability and breach’’. [2001] J.P.I.L. 5.13Ohman L et al. ‘‘Longitudinal analysis of the relation between moderate long-term stress and health’’ Stress & Health

2007, Vol.23, pp.31–8.14Law Commission, Liability for Psychiatric Illness, (1998), No.249, pp.9–10.


WHAT IS A STRESS-RELATED INJURY?

in which a list of such illnesses might be found. The merits of any claim will depend on‘‘expert medical evidence’’. Presumably, medical experts in the UK will consult such sourcesas the Diagnostic and Statistical Manual of Mental Disorders (DSM-IV) or, more likely,the International Classification of Diseases (ICD-10) in seeking a ‘‘recognisable’’ diagnosis.However, ICD-10 describes few stress-related disorders15 beyond F43.0: acute stress reaction(which includes disorientation, agitation and anxiety) and F43.2: adjustment disorder (whichincludes depressed mood, anxiety, worry and inability to cope).

Until recently, litigation falling under the Disability Discrimination Act 1995 (DDA), whichcovered actions brought before an Employment Tribunal, recognised mental impairment but‘‘only if the [mental] illness is a clinically well-recognised illness’’ (Sch.1). This legislationwould reject sickness certificates from GPs referring to stress, depression or anxiety. Again, noguidance was given about what constitutes a ‘‘well-recognised’’ illness and the requirementitself was dropped from the revised DDA in 2005.

In the absence of firm legal guidelines, it is instructive to examine what is actuallyhappening in the courts. A brief survey of recent cases16 shows that successful claimantsreceived such diagnoses as: nervous breakdown, depression, nervous breakdown plus chronic depression,deep depression plus acute anxiety, and psychiatric breakdown. This suggests that the number ofacceptable diagnostic categories may actually be somewhat limited, and that both the courtsand the medical experts implicitly recognise the fact. It would seem most useful for allconcerned if this recognition were to be made explicit.

Can we produce an algorithm?

A major advance in this area was recently signalled by a report by Cox and co-workersfrom Nottingham University, which was commissioned by the HSE.17 Using a combinationof literature surveys and interviews with ‘‘stakeholder representatives’’ (including thoserepresenting the legal and insurance professions) the report concludes, first, that the centralelement of any case definition of work-related stress should be the ‘‘experience of anxiety ordepression in relation to work’’ (p.52). This proposal recognises the fact18, as demonstratedby Ohman and reported by many others, that:

‘‘adverse work conditions are associated more closely with subsequent increases inpsychological symptoms rather than . . . physical symptoms or changes in healthbehaviour’’

It also reflects very recent prospective finding that self-reported high job demand doublesthe risk of major clinically diagnosed depressive or generalised anxiety disorder in individualswith no previous history of these complaints.19 Indeed, 85 per cent of users of occupationalstress counselling services present with either anxiety or depression.20

15World Health Organisation, International Statistical Classification of Diseases and Health Related Problems, (Geneva: WHO,1992), ICD-10 Vol.1.

16Details available from the author.17Cox J., Griffiths A., Houdmont J., ‘‘Defining a Case of Work-Related Stress’’, HSE Research Report No 449 (Sudbury:

HSE Books, 2006).18Daniels K. et al., ‘‘Cognitive Factors Influence on the Expression and Reporting of Work-Related Stress’’, HSE Research

Report RR 170. (Sudbury: HSE Books, 2004).19Melchior M. et al., ‘‘Work stress precipitates depression and anxiety in young, working men and women’’, Psychol Med.

(published online, April 4, 2007) doi:10.1017/S0033291707000414.20Arthur A., ‘‘When stress is mental illness: a study of anxiety and depression in employees who use occupational stress

counselling services’’, Stress and Health 2005, Vol.21, pp.273–80.



To distinguish a work-related symptom of sufficient severity to be diagnosable as a ‘‘case’’,the threshold should be the point where an individual, ‘‘would in all likelihood receive aclinical diagnosis if examined according to DSM IV or ICD-10’’ (p.63). The Nottinghamreport acknowledges that the need to demonstrate serious psychiatric impairment (whenmost cases of work-related stress are sub-clinical) coupled with the fact that the individual’ssymptoms may not exactly fit into the diagnostic category, could both lead to cases failingin the courts. It also speculates that the degree of severity could be assessed by non-medical investigators using suitable psychological rating scales. Some possible implications forgeneral practice of this or any other change in the sickness certification system are discussedelsewhere.21

In addition to the diagnostic category, Cox et al. further suggest that, to be legallyacceptable, such a case definition should be assessed within a framework of five additionalcriteria. These reflect the importance that the civil courts attach in personal injury casesto whether the psychiatric injury could have been foreseen and whether the employerwas negligent in a way that caused or contributed to the problem. These five criteria, allassessable from the claimant’s self-report are: (i) whether the individual has actually reportedsuffering from work-related stress; (ii) evidence of unreasonable exposure to psychosocialhazards; (iii) presence of significant ill health; (iv) observable consequences for the claimant’sbehaviour, and finally (v) a consideration of any individual circumstances (e.g. psychologicalvulnerabilities) that might be present. The Nottingham group still regard these importantrecommendations as preliminary, and believe that a more precise algorithm for makingjudgments of ‘‘caseness’’ requires further research. (p.vii).

Already too late?

However, some fear that this long-running debate may have been overshadowed by events,following the successful claim of Majrowski against Guy’s and St Thomas’ NHS Trust.22 Heclaimed to have been harassed by his manager and the Trust was found to be ‘‘vicariouslyliable’’ for a breach of its statutory duty under the Harassment Act 1997. Harassment is notformally defined but is understood to be conduct targeted at an individual which is calculatedto alarm that person or cause them distress, and which is oppressive and unreasonable. InJuly 2006, the House of Lords ruled that harassment could be used as a cause of action inemployment cases, although the legislation was not introduced for that purpose.

Legal opinion is currently divided23 on the extent to which actions for harassment (whichrequire only to demonstrate that the claimant suffered alarm and which may be difficult forthe employer to defend against) will replace or accompany existing common law stress claims.These require the demonstration of forseeability and negligence on the employer’s part, inaddition to a more ‘‘recognised’’ psychiatric diagnosis. The need for a consensus definitionof stress-related injury is as pressing as ever.

21Wood–in preparation.22Majrowski v Guy’s & St Thomas’ NHS Trust [2006] U.K.H.L. 34; [2007] A.C. 224.23See for example Platt D., ‘‘Personal injury: stressing the point’’ in Legal Week (October 30, 2006) and ‘‘Bullying and

harassment’’in Personal Injury Law Review (Autumn 2006).


quantum

Uncertainty about Uncertainty:Damages for Loss of a Chance

ANDREW BURROWS*

Breach of contract; Damages; Economic loss; Loss of chance; Negligence;Personal injury claims; Torts

Abstract

Andrew Burrows reviews the law relating to loss of a chance and analyses the keydecisions in this area culminating in the House of Lord’s decision in Barker v Corus. Helooks at the way the law treats such claims, both in contract and in tort and identifiesfour distinct categories. He then poses five questions as he considers the extent to whichthe law distinguishes between multi-agent and single agent causes and seeks to rationaliseand reconcile the decisions reached by the courts in the leading cases. ML

Introduction

In recent years the most difficult and controversial cases in personal injury law, and indeedin tort law generally, have concerned causation. Within that troubled area, it is damages forloss of a chance or, as one might alternatively phrase it, damages assessed according to thechances of loss that is the single most problematic topic. Viewed through the retrospectivereinterpretative reasoning of the House of Lords in Barker v Corus (UK) Plc,1 we can say thatthe following headache-inducing decisions of the House of Lords have all concerned theissue of loss of a chance in tort: McGhee v National Coal Board,2 Hotson East Berkshire HA,3

Wilsher v Essex Area HA,4 Fairchild v Glenhaven Funeral Services Ltd,5 Gregg v Scott6 and Barkeritself.

However, our task is even more difficult than trying to understand those cases. This isbecause, in order to avoid inconsistency as one moves from one pocket of law to another,

∗Q.C., FBA, Norton Rose Professor of Commercial Law, University of Oxford; Fellow of St Hugh’s College. Thisis a lightly amended version of the Personal Injury Bar Association Lecture 2007 delivered in the Inner Temple onNovember 27, 2007. I would like to thank William Norris Q.C. for inviting me to give that lecture. I would also liketo thank James Edelman and Edwin Peel for their helpful comments on an earlier draft. I can be contacted by e-mail at:[email protected]

1[2006] UKHL 20; [2006] 2 A.C. 572.2[1973] 1 W.L.R. 1.3[1987] A.C. 750.4[1988] A.C. 1074.5[2002] UKHL 22; [2003] 1 A.C. 32.6[2005] UKHL 2; [2005] 2 A.C. 176.


[2008] JOURNAL OF PERSONAL INJURY LAW—QUANTUM

and to build up a truly coherent picture of the law, we also need to see and understanddamages for loss of a chance in non-personal injury tort cases and in contract as well astort. So one sometimes hears the argument—and indeed it expressly perplexed the Houseof Lords in Gregg v Scott—that in respect of damages for loss of a chance, pure economicloss claims are being favoured over personal injury claims, which, if correct, would appear toconstitute a grotesque reversal of values. Again I have heard it said that claimants are missinga trick because if there were a contractual relationship, as there often is, between claimantand defendant, the claim would be better founded in contract than tort so as to make loss ofa chance damages straightforwardly recoverable. And obiter dicta of the House of Lords inthe recent pleural plaques case of Rothwell v Chemical and Insulating Co Ltd7 can be regardedas offering some tentative support for that approach for the suggestion made was that thedecision might have been different had the claim been brought in contract rather than tort.One can only fairly assess the force of arguments such as these if one is aware of all the lawon damages for loss of a chance. So what I am attempting to do in this article is to provide anoverview of the whole law on damages for loss of a chance, albeit that my primary focus willbe on personal injury. So I am trying to fit together, and make sense of, cases such as Chaplinv Hicks,8 Allied Maples Group Ltd v Simmons and Simmons,9 and Barker v Corus. You mayconsider that the task I have set myself is hopelessly over-ambitious and, if you are thinkingthat, you would probably be absolutely right.

Before proceeding any further, a word is merited about the terminology of damages forloss of a chance. While it may be possible to distinguish conceptually between damages forloss of a chance and damages for the chance of a loss,10 I am here drawing no such distinction.Rather I am using the terminology of loss of a chance in a wide sense, which covers both thelost chance of acquiring a benefit and the lost chance of avoiding a detriment. Increasing thechance of a loss equates to the lost chance of avoiding a detriment and this explains why acase like Barker—where their Lordships tended to talk in terms of ‘‘materially increasing therisk’’ of a disease—is equally well viewed as a loss of a chance case. Materially increasing therisk of a disease or injury means that the claimant has lost the chance of avoiding the diseaseor injury. As Lord Walker said in the Barker case, ‘‘‘increase in risk’’ [has, as] its mirror image,‘‘loss of a chance’’’.11 The important underlying point is that my reference to damages forloss of a chance is intended to embrace all situations where the courts assess compensatorydamages proportionately according to the chances.12 So through the terminology of loss of achance, the central question I am asking in this article is this: when is it that the courts awardcompensatory damages in proportion to the relevant chances, rather than applying an all ornothing balance of probabilities approach?

7[2007] UKHL 39.8[1911] 2 K.B. 786.9[1995] 1 W.L.R. 1602.

10That distinction is drawn in the excellent article by K. Cooper, Assessing Possibilities in Damages Awards The Loss of aChance or the Chance of a Loss? (1972–3) 37 Sask L.R. 193. However, as in this paper, nothing in the analysis in thatarticle turns on that distinction and the central question the article addresses is the underlying one of whether thelaw should adopt what is termed a ‘‘simple probability’’ approach to contingencies in assessing damages (i.e., damagesassessed proportionately according to the chances).

11[2006] UKHL 20 at [114].12McGregor on Damages (17th edn, 2003), in his excellent ch.8 called Certainty of Damage seeks to distinguish, at paras.

8-036, 8-047 and 8-048, between the run of the mill personal injury case involving assessment of future and hypotheticalemployment prospects and the ‘‘rather special doctrine of loss of a chance’’ or the ‘‘loss of a chance case.. in the truesense’’. It is hard to see wherein his distinction lies and it is not articulated by McGregor, albeit that he initially has inmind as the loss of a chance case where there ‘‘is one particular chance that the claimant loses’’ (see para.8-024). Butsurely there should be no principled difference between the treatment of a chance and the treatment of more than onechance. Cf Herring v Ministry of Defence [2003] EWCA Civ 528; [2004] 1 All E.R. 44 at [25]–[26].


UNCERTAINTY ABOUT UNCERTAINTY: DAMAGES FOR LOSS OF A CHANCE

Future or hypothetical events rather than past facts

In clearing the ground, there is a very important initial point. The area of controversy aboutdamages for loss of a chance concerns uncertainty as to hypothetical events or the future. Itdoes not concern uncertainty as to past fact. All uncertainty as to what happened in the pastis resolved in the civil law by a balance of probabilities all-or-nothing test.

Say, for example, in a road traffic accident, there is uncertainty as to the speed at whichthe defendant was travelling and hence whether the damage to the claimant’s car was causedby any negligence of the defendant. Let us further assume, somewhat simplistically, that hadthe defendant been travelling at 40mph or less, his driving would not have been negligent;whereas had he been driving at over 40mph, his driving would have been negligent. Thecourt has to decide the question of the speed that the defendant was travelling one way orthe other. If the claimant cannot prove on the balance of probabilities that the defendant wastravelling at more than 40mph, the claim will fail. There can be no question of the courtcoming to the view that, as there is a 60 per cent chance that the defendant was travellingat more than 40mph, the claimant should only be entitled to 60 per cent of the damages;nor is there any question of the court awarding 25 per cent of the damages if the claimanthas satisfied it to a 25 per cent degree of probability that the defendant was so negligent.The matter has to be decided on a balance of probabilities provable by the claimant in anall-or-nothing manner.

The classic exposition of the distinction between past fact on the one hand, and hypotheticalor future events on the other, was given by Lord Diplock in the Fatal Accidents Act case ofMallett v McMonagle.13 He said:

‘‘In determining what did happen in the past a court decides on the balance ofprobabilities. Anything that is more probable than not it treats as certain. But inassessing damages which depend upon its view as to what will happen in the futureor would have happened in the future if something had not happened in the past,the court must make an estimate as to what are the chances that a particular thingwill or would have happened and reflect those chances, whether they are more orless than even, in the amount of damages which it awards.’’

Similar observations were made more recently by Lord Nicholls of Birkenhead in hisdissenting speech in Gregg v Scott. He said:

‘‘In the normal way proof of the facts constituting actionable damage calls forproof of the claimant’s present position and proof of what would have been theclaimant’s position in the absence of the defendant’s wrongful act or omission. Asto what constitutes proof, traditionally the common law has drawn a distinctionbetween proof of past facts and proof of future prospects. An event happening inthe past either occurred or it did not. Whether an event happened in the past isa matter to be established in civil cases on the balance of probability. If an eventprobably happened no discount is made for the possibility it did not. Proof of futurepossibilities is approached differently. Whether an event will happen in the futurecalls for an assessment of the likelihood of that event happening, because no oneknows for certain what will happen in the future.’’14

13[1970] A.C. 166 at 176.14[2005] UKHL 2; [2005] 2 A.C. 176 at [9].



Having then explained that an assessment of the chances is also generally applied tohypothetical facts15 he concluded:

‘‘The theory underpinning the all-or-nothing approach to proof of past facts appearsto be that the past fact either happened or it did not and the law should proceedon the same footing. But the underlying certainty, that a past fact happened or itdid not, is absent from hypothetical facts. By definition hypothetical events did nothappen in the past, nor will they happen in the future. They are based on falseassumptions. The defendant’s wrong precluded them from ever materializing.’’16

So the initial question that must always be asked in this area, whether by a practitioneradvising on ‘‘loss of a chance’’ or a judge deciding on ‘‘loss of a chance’’, is whether therelevant uncertainty that is in issue is about a past fact or not. If the uncertainty is about whatdid happen in the past or what the state of affairs was in the past, a balance of probabilitiesapproach applies. A ‘‘loss of a chance’’ approach is only on the agenda if the uncertainty inissue is as to the future (that is, what will the claimant’s position be after trial) or is as to ahypothetical event (that is, what would have happened to the claimant, in the past or in thefuture, had there been no breach of duty).

Cases awarding damages for loss of a chance

What examples are there, therefore, of damages being awarded for loss of a chance? Theprincipal examples can be helpfully divided into four very wide-ranging categories. I proposeto look briefly at each of these four categories. However, I should say at the outset that thefourth rests on the move made by the House of Lords in Barker v Corus, which, potentially,has dramatically and problematically widened the ambit of damages for loss of a chance.

Loss of profits in contract

The first category is damages for loss of profits, or other lost economic benefits, consequenton a breach of contract. The leading case is Chaplin v Hicks.17 The claimant entered abeauty competition organised by the defendant. Fifty of the entrants were to be selected forinterview; and from those, 12 were to be offered theatrical engagements. The claimant wasselected as one of the 50 for interview but, through the defendant’s breach of contract, shewas not informed in time. It was held by the Court of Appeal that, while the claimant wasnot entitled to damages on the basis that she would have won an engagement, nevertheless

15However, it should be noted that Lord Nicholls drew a distinction between hypothetical future events and hypotheticalpast events in that he thought that, while a chances approach applied to the former, the balance of probabilitiesall-or-nothing approach normally applied to the latter. But, with respect, this is misleading. The cases relied on by LordNicholls as showing an all or nothing balance of probabilities approach were ones where a chances approach would onlybe applied to the assessment of damages once the claimant had established, on the balance of probabilities, that there hadbeen an actionable personal injury or death: see footnote 30 below. But once such a personal injury or death had beenestablished, a chances approach would be applied in assessing damages whether one was dealing with uncertainty as tothe future, uncertainty as to a hypothetical event in the future or uncertainty as to a hypothetical event in the past (e.g.what would the claimant have earned pre-trial had he not been injured).

16[2005] UKHL 2; [2005] 2 A.C. 176 at [14].17[1911] 2 K.B. 786.



she was entitled to damages for the lost chance of winning an engagement. That is, she wasentitled to damages scaled down proportionately in accordance with what the chances of gainwere thought to be.

It would be a major mistake to regard Chaplin v Hicks as an isolated example. Onthe contrary, almost all loss of profit awards in contract involve an assessment of damagesaccording to the contingencies. A good recent example is Jackson v Royal Bank of Scotland Plc18

where one question at issue was whether the claimant and the third party customer wouldhave continued to make contracts with each other had there not been the breakdown in therelationship caused by the defendant bank’s breach of contract. In assessing the appropriatedamages for loss of profits, it was held that the parties would otherwise have continued tomake contracts for a further period of four years but that the amount of damages awardedfor the lost benefits of those contracts should be reduced towards the end of the four yearsto reflect the increased uncertainties that the contracts would have been concluded. Anotherwell-known example is Ministry of Defence v Wheeler19 where a number of women had beenwrongfully dismissed from the army because of pregnancy. In assessing their damages forwrongful dismissal, the Court of Appeal took into account the chances that they would haveleft the army in any event.

Pure economic loss in the tort of negligence

A second category of case where the courts award damages for loss of a chance is for pureeconomic loss in the tort of negligence. Of course, the situations in which pure economicloss is recoverable in the tort of negligence are limited. For the purposes of this paper, one cansay that they are limited to where there is a contractual relationship between the parties or asimilar close relationship in which the defendant has assumed responsibility to the claimant.However, assuming that there is such a relationship, loss of a chance damages are clearlyrecoverable.

The most common examples are actions against negligent solicitors where a client’s claimhas become time-barred. The courts assess damages in tort and contract according to thechances that the claim would have otherwise been successful. One illustration suffices. InKitchen v Royal Air Forces Association20 the claimant’s husband had been electrocuted and diedwhile preparing tea in the kitchen of his home. In respect to the wife’s possible action againstthe relevant electricity company under the Fatal Accidents Act, her solicitors appeared to takethe extraordinary decision of deliberately letting the limitation period run out in the vaguehope of obtaining a satisfactory ex gratia payment. You may not be surprised to hear that thematter was being conducted for the defendants by its articled clerk. Lord Evershed M.R. wasscathing of the solicitors’ conduct:

‘‘[The] solicitors proceeded to adopt the line of least possible effort. It is not merelythat they never applied their minds at all to what their duties were and what thepossible rights of the plaintiff might be, but they never applied their minds. . .to thequestion of who their client was.’’21

18[2005] UKHL 3; [2005] 1 W.L.R. 377.19[1998] 1 W.L.R. 637.20[1958] 1 W.L.R. 563.21[1958] 1 W.L.R. 563 at 568.



However, the important point for us is that the Court of Appeal upheld an award of £2,000damages on the basis that the claimant was entitled to damages assessed proportionately,according to the chances that she would have had of winning a Fatal Accidents Act claim.There are many other examples in the law reports of analogous awards for loss of a chance inprofessional negligence actions, primarily against solicitors in litigation or other work,22 butalso against, for example, surveyors23 and accountants.24

In case it is thought that the only examples are ones involving concurrent liability in tortand contract, it is helpful to refer to Spring v Guardian Assurance Co.25 Here the House ofLords held that a former employer owed a duty of care to its former employee in writinga reference that was an essential requirement for employment with a new employer. Mostimportant for us is the following passage in the speech of Lord Lowry. Referring to theauthority of Chaplin v Hicks, he said:

‘‘Once the duty of care is held to exist and the defendant’s negligence is proved, theplaintiff only has to show that by reason of that negligence he has lost a reasonablechance of employment (which would have to be evaluated) and has thereby sufferedloss. . .He does not have to prove that, but for the negligent reference, [the newemployer] would have employed him.’’26

Before moving on, this seems an appropriate point to deal with Allied Maples. This was aprofessional negligence claim brought against a solicitor in contract and tort in relation to thedrawing-up of a contract. There were two areas of uncertainty. Would the claimant clienthave acted on the defendant solicitor’s advice had correct advice been given; and wouldthe other party to the contract, the third party, have then agreed to the proposed differentclauses in the contract? The Court of Appeal drew a now infamous distinction between thehypothetical conduct of the third party to which the normal chances approach in this areashould be applied; and the hypothetical conduct of the claimant to which it was held that anall-or-nothing balance of probabilities approach should apply.

How do we explain the insistence on a balance of probabilities approach in relation to theclaimant’s hypothetical conduct? No explanation for this was offered in the case itself but Ifind helpful what McGregor on Damages27 says about this. He writes:

‘‘At first glance it may seem somewhat strange to have different tests applicable tohypothetical acts of the claimant and hypothetical acts of third parties. But it canbe seen to make sense. For a claimant can hardly claim for loss of a chance that hehimself would have acted in a particular way: he must show that he would havedone.’’

In other words, the courts equate uncertainty about how the claimant would have actedwith uncertainty as to past fact because it can expect the claimant to provide as good evidenceabout its own conduct as it can provide about past fact. The court either believes the

22Sharif v Garrett & Co [2001] EWCA Civ 1269; [2002] 1 W.L.R. 3118; Normans Bay Ltd v Coudert Brothers [2003] EWCACiv 215.

23First Interstate Bank of California v Cohen Arnold [1996] P.N.L.R. 17.24John D. Wood & Co Ltd v Knatchbull [2002] EWHC 2822 QB; [2003] 8 E.G. 131.25[1995] 2 A.C. 296.26[1911] 2 K.B. 786 at 327.2717th edn [2003] para.8-035.



claimant’s evidence as to how it would have acted or it does not.28 A balance of probabilitiestest seems appropriate even though one is in a context where loss of a chance damages isnormally recoverable. In contrast, third parties may not be before the court and, at leastgenerally therefore, one is in the realm of greater uncertainty as regards the hypotheticalactions of third parties so that an all or nothing balance of probabilities approach seems lessappropriate than the normal chances approach.

Loss consequent on an actionable personal injury or death

If one puts to one side Barker v Corus for the moment, it is clear that the availability of damagesfor loss of a chance in the area of personal injury and death has turned on a distinctionbetween whether there is an actionable personal injury or death—that is the liability orcause of action question—and quantification of damages assuming that there is an actionablepersonal injury or death. At the cause of action or liability stage the law has traditionallyapplied a once and for all balance of probabilities approach and loss of a chance of avoidingan injury or disease has not itself been actionable. So in Barnett v Chelsea and KensingtonHospital Management Committee29 where the claimant’s husband died of arsenic poisoning, thequestion asked was whether on the balance of probabilities the deceased would have livedhad the defendant doctor properly examined and treated him. It was held that as he wouldprobably have died in any event, there was no liability.30 Similarly, in Hotson and Gregg v Scottthe claimants’ attempts to found their actions on the loss of the less than 50 per cent chanceof recovery–that is on the negligent material increase of risk of avoiding the permanent hipdisability in Hotson, or the spread of the cancer in Gregg–both failed.

In contrast, once there is an actionable personal injury, uncertainties as to what theclaimant’s future will be and/or what the claimant’s position would have been had theynot been injured have led to the courts quantifying proportionate damages accordingto the chances. Analogously in Fatal Accident Act claims, the courts quantify damagesproportionately in line with their assessment of what a dependant’s future will be and/orwhat the deceased’s and dependant’s position would have been but for the death. Suchchances are reflected proportionately in the damages awarded: in other words, although nottraditionally phrased in this way, the courts are standardly awarding damages for loss of achance when quantifying or assessing damages for personal injury or death. So in calculatingfuture pecuniary loss, the multipliers in the Ogden Tables take account of the statisticalchances of death prior to normal retirement age and the courts make a further adjustment forthe contingencies of life (that is, for the fact that the claimant might in any event have beenunemployed or sick).

In some recent cases on the assessment of damages for loss of earnings consequent on apersonal injury, the courts have expressly referred to the award as being for loss of a chance.For example, in Doyle v Wallace31 the 19-year-old claimant suffered brain damage in a roadaccident. In quantifying her loss of past and future earnings, the main uncertainty was whether

28On the face of it the decision in Ministry of Defence v Wheeler appears to contradict this. However, this was perhapsbecause most of the uncertainty was not about what the claimant would have done but about the occurrence of othercontingencies.

29[1969] 1 Q.B. 428.30See also the application of a balance of probabilities test to the conduct of the claimant and defendant respectively in

McWilliams v Sir William Arrol & Co Ltd [1962] 1 W.L.R. 295 and Bolitho v City and Hackney Health Authority [1998]A.C. 232 in the context of deciding whether there was an actionable personal injury or death.

31[1998] P.I.Q.R. Q146.



she would have otherwise qualified and worked as a drama teacher. The chances of this wereassessed at 50/50. Dismissing the defendant’s argument that, as she had failed to prove on thebalance of probabilities that she would be a teacher, this possibility should be ignored, theCourt of Appeal awarded her damages for the 50 per cent chance of becoming a teacher.This was subsequently followed in, for example, Langford v Hebran32 in assessing the loss ofearnings that the claimant would have made from professional kick-boxing and in Brown vMinistry of Defence33 in which, in quantifying damages for loss of pension, the chances of theclaimant completing 22 years of service, which would have entitled her to an immediatepension, were assessed at 30 per cent.

It is also trite law that in considering a claimant’s future position, one includes the riskof deterioration (or it could be improvement) consequent on the actionable personal injury.Classic examples are damages awarded for the 10 per cent risk that the claimant who hassuffered a head injury will develop epilepsy or that the claimant who has suffered a handinjury has a 20 per cent chance of suffering from osteo-arthritis.34

I should just break off from my main theme in this article to say that there is an unresolvedquestion as to whether, once there is an actionable personal injury, the claimant can use thatas a hook or peg on which to hang a claim for the risk of a further injury that is consequentialon the breach of duty, but is not consequential on the initial injury. This was not resolved inthe Rothwell case because only Lord Rodger clearly took the view that the hook argumentfails.35 Yet on the facts of that case, if Lord Rodger was right, one would have expected alltheir Lordships to have ruled out the claims on that basis because there was no doubt that theincreased risk of mesothelioma was not consequent on the pleural plaques, albeit that it wasconsequent on the breach of duty.

Loss of a chance of avoiding an injury or disease provided the Barker v Corustwin criteria are satisfied.

In dealing with apportionment in Fairchild-type cases, the House of Lords in Barker v Corusreinterpreted the ‘‘material increase of risk’’ idea, that had controversially been used to satisfycausation in McGhee and Fairchild, as logically dictating that the relevant actionable injury wasthe loss of a chance of avoiding the disease, rather than the disease itself. In other words, it washeld that the defendant should be liable in damages proportionately for the increase in risk ofthe claimant contracting the disease and not for the disease itself. Albeit seen by the majorityas a step back from the full pro-claimant consequences of Fairchild, there can be no doubtthat in terms of legal principle this was a radical move. Although for those suffering frommesothelioma, the decision in Barker v Corus has been reversed by s.3 of the CompensationAct 2006, its reasoning remains of pivotal importance for the loss of a chance issue. For thefirst time, the loss of a chance of avoiding a personal injury can itself be actionable. Theline is now being held not by saying that one cannot have a free-standing claim for the lostchance of avoiding an injury, but rather by invoking two criteria, which I am going to referto as the Barker twin criteria. The first is that the disease or injury in question must havebeen suffered. The second is that there must have been a single causative agent rather thanmultiple causative agents. I shall now look at each of these two criteria in turn.

32[2001] EWCA Civ 361; [2001] P.I.Q.R. Q13.33[2006] EWCA Civ 546; [2006] P.I.Q.R. Q9.34Jones v Griffiths [1969] 1 W.L.R. 795 at 801.35[2007] UKHL 39 at [91].



The fact that the disease or injury in question must have been suffered, means that therelevant outcome must have eventuated. It is the loss of a chance of avoiding a disease thathas already been contracted that one is talking about. Barker is not concerned with allowingdamages for the chance of contracting a disease or injury in the future. This restriction mustsurely be correct. This is not because a balance of probabilities approach is preferable to a lossof a chance approach but rather because, on policy grounds, there should be no substantialdamages at all in this situation. Take the example of a radiation leak from a power station.To allow claims by all those who may be able to show that, as a result of that leak, theirrisk of contracting cancer has been materially increased would, arguably, cripple defendantsand their insurers. However, even if there were no floodgates problem, there is still a verystrong policy reason here not to allow damages. This policy, as explained by Baroness Halein Gregg v Scott,36 is that the particular uncertainty can be resolved, and is best resolved, byrequiring claimants to ‘‘wait and see’’. The position as to the claimant’s physical conditionwill in time be certain.37 Admittedly, where there is already an actionable injury before thecourts, a policy of ‘‘wait and see’’ is sacrificed by the stronger policy underpinning the onceand for all rule of resolving as many issues as possible between the parties. However, in anideal world, as is now recognised by the wider availability of periodic payments, even inpersonal injury cases where there is already an actionable injury, a ‘‘wait and see’’ approachshould be applied to the risk of future injury or disease.

The second, and more controversial of the twin criteria, is that Barker only applies wherethere is a single causative agent and not where there are multiple causative agents. This is anextremely slippery concept. What does it mean? The House of Lords was clear that Barker andFairchild were single agent cases in that the single causative agent was asbestos. As an exampleof multiple agents to which the loss of a chance approach was inapplicable, their Lordshipspointed to lung cancer possibly caused by negligent exposure to asbestos and smoking. Theywere also clear that Wilsher v Essex Area Health Authority38 was a multiple agent case becausethe blindness of the baby could have been caused by five possible agents, only one of whichwas the excess oxygen negligently administered by the defendant.39 However, this leaves uswith serious interpretative difficulties as regards cases such as McGhee, Hotson and Gregg.40

While their Lordships indicated that McGhee was a single agent case, whereas Hotson andGregg were not, it seems to me that all of these can plausibly be argued to be single agentcases in which the defendants had materially increased the risk of that single agent causing therelevant disease or injury. That is, the single agents can be respectively said to be: in McGhee,the brick dust that led to the dermatitis; in Hotson, the cutting off of the blood supply thatled to the boy’s hip disability; in Gregg v Scott, the pre-existing cancerous cells that led to thespread of the cancer. As Ed Peel has written:

‘‘In Hotson v East Berks AHA there was only one causal agent operating, namely thefall from the tree and its effect on the blood supply to the claimant’s hip. In Greggv Scott the only causal agent was the cancer from which the claimant was already

36At [212].37This explains why even a claimant who can show on the balance of probabilities that he will suffer the disease, is still

unable to recover any damages.38[1988] A.C. 1074.39The other four were conditions from which the baby had suffered: hypercarbia, intravenicular haemorrhage, apnoea and

patent ductus arteriosus.40It is tempting to reanalyse Gregg as a case where the outcome had not eventuated because, as it happened, Mr Gregg

was still alive. But Lord Hoffmann accepted at [38] in Barker that that reanalysis was not open to him because the caseproceeded on the assumption that Gregg had suffered the relevant outcome: i.e. that he had suffered such a spread ofcancer as to reduce significantly his expectation of life.



suffering when he first went to see his doctor. In both cases, the delay in treatmentdue to the negligence of the defendant increased the risk of injury from one agent.Fairchild and Barker might be distinguished on the basis that the negligence of thedefendant introduced more of the same agent, but this will not work for McGheewhere the analogy with Hotson and Gregg is particularly acute–delay allowed thecausal agent already in play to continue its deleterious effect on the claimant.’’41

Nor do I think it is convincing to hive off Hotson as a case involving uncertainty about pastfact–the state of the blood vessels in the boy’s leg at the time of the negligent care—albeit thatthat was the express reasoning of their Lordships in that case. For if that was a case of past factso surely was Fairchild in the sense that one did not know whether the single asbestos fibrewas already in the claimant’s lung when he was employed by the second negligent employer;and so was McGhee in the sense that one did not know the state of the claimant’s skin at thetime when he should have been provided with a shower. The truth of the matter is that thereal uncertainty in Hotson was over a hypothetical question, would the claimant’s permanenthip disability have been avoided had the defendant complied with its duty. It was not reallyuncertainty about a past fact at all.

It is plain, therefore, that the second of the Barker criteria—the need for a single causativeagent–is difficult and controversial. This perhaps explains why Lord Hoffmann’s initialreaction in Gregg v Scott had been to reject it as unprincipled albeit that by the time ofBarker he had changed his mind.42 Indeed the problems may be even greater than I have sofar indicated because on the face of it, it is hard to see why Barker v Corus should not beapplied to straightforward accident cases. Take the slipping in the swimming pool case ofClough v First Choice Holidays & Flights Ltd.43 Although the Court of Appeal there dismissedthe claimant’s argument that Fairchild should be applied to lower the standard of proof, afterBarker v Corus why could such a claimant not argue that this was a ‘‘single agent’’ case—thesingle agent being the contact with the ground that led to the head injury—and that thereforesome damages for the negligently increased risk of (i.e. the loss of the chance of avoiding) thehead injury would be recoverable?

So there are real difficulties in understanding how the single agent concept is meant toapply. Arguably it is best viewed as a flexible control device to hold back the floodgates oflitigation, not only in the usual sense of stopping a mass of claims from a single incident, butalso in the unusual sense of stopping claims from a mass of separate incidents. So if one askswhy were the courts not willing to award damages in Hotson and Gregg v Scott but were inFairchild and Barker, it may well be that the only sensible explanation is that it was the fear ofthe impact of a mass of separate claims against medical practitioners and on the resources ofthe health service that was driving the courts. However, if that is so, transparency of reasoningdictates that that policy ought to be properly articulated ‘‘up front’’ rather than being hiddenbehind the pretence that there is a clear-cut ‘‘single agent’’ principle that reconciles thecases. Put another way, and with great respect, the majority of the House of Lords in Barkershould not have opened the ‘‘loss of a chance’’ box without fully explaining how one wouldsubsequently control the inevitable fall-out from that box.

41Lost Chances and Proportionate Recovery [2006] L.M.C.L.Q. 289, 294.42[2005] UKHL 2; [2005] 2 A.C. 176, at [72]; [2006] UKHL 20 at [23]. Nor does the concept become easier to understand

by stressing, as Lord Hoffmann did at [24], that the single causes must have ‘‘operated in the same way’’.43[2006] EWCA 15; [2006] P.I.Q.R. P22.



Five questions

Up to this point, I have set out the four principal wide-ranging categories where damages forloss of a chance are recoverable. Loss of profit in contract, pure economic loss in tort, lossconsequent on an actionable personal injury or death, and loss of a chance of avoiding aninjury or disease within the Barker twin criteria. I now want to draw together the threads byattempting to answer five questions.

First, can it now be said that, as regards hypothetical and future events, the normal ruleis that damages are awarded proportionate to the chances rather than on an all or nothingbalance of probabilities approach? This is not easy to answer. On the one hand, the abovefour categories are very wide-ranging and there are other examples outside those four thatspace has prevented me dealing with. On the other hand, subject to Barker v Corus, it remainsa fundamental restriction in personal injury and death cases that the breach of duty must beshown on the balance of probabilities to have caused the injury or death. And as we haveseen, where the uncertainty is as to the claimant’s conduct, Allied Maples establishes that abalance of probabilities all or nothing test applies even if one is in the context where lossof a chance damages are normally recoverable. Note also that the chances approach is nottaken in relation to the defendant’s hypothetical conduct. As regards the defendant, the startingassumption is that the defendant would not have broken the relevant duty. Hence the mantrathat the aim of compensation is to put the claimant into as good a position as if the dutyhad not been broken, i.e. as if the defendant had complied with its duty. Even where thedefendant had a choice of different modes of performance, a chances approach is generallynot applied. Instead the courts have traditionally applied a minimum obligation principle bywhich they assume that the defendant would have performed in the way most favourable toitself.44 So looking across the whole law perhaps the best answer to the question posed is thatit is as yet too early to be sure what the general position is. However, if the radical movein Barker survives, it is at least arguable that the law has moved to (or is moving towards)the general rule being that, in respect of uncertainties about future or hypothetical events,45

damages are awarded proportionate to the chances: this general rule is then subject to severalvery important exceptions which, in so far as justified, rest on various policy considerationssuch as ‘‘wait and see’’ and shielding medical practitioners.

Secondly, is there a different approach to loss of a chance in contract and tort? I think theanswer is ‘‘no’’. As we have seen, there are cases in both contract and tort applying a loss of achance approach, but just as the Kitchen case does not mean that a chances approach is alwaysapplied in tort, nor does Chaplin v Hicks mean that a chances approach is always applied incontract. So while it is of course true that a breach of contract is actionable per se so thatthere is an indisputable claim for nominal damages, this does not mean that the increased risk

44In the leading case of Laverack v Woods of Colchester [1967] 1 Q.B. 278, the majority of the Court of Appeal (LordDenning dissenting) refused to award the claimant, who had been wrongfully dismissed, any part of the discretionarybonuses which the defendant employer had been accustomed to paying. Admittedly, there has been some departurefrom this minimum obligation principle and Laverack was distinguished in the recent case of Horkulak v Cantor FitzgeraldInterntional [2004] EWCA Civ 1287; [2004] I.C.R. 402 in which the claimant employee was held entitled to the bonuswhich the defendant employer would have paid rather than the minimum that it could legally have paid. But while thatdoes open the possibility of a loss of a chance approach being applied exceptionally even to the defendant’s conduct, thegeneral starting point in assessing damages is simply and clearly that the defendant would have complied with its duty.

45This assumes that one is in the sphere of recoverable loss. Clearly damages for loss of a chance are irrecoverable where,even if the outcome were to eventuate, there would be no recoverability. So, for example, one could not recover forthe loss of the chance of making profits on the melts that, but for the power cut, would have been put through thefurnace in Spartan Steel and Alloys Ltd v Martin & Co (Contractors) Ltd [1973] Q.B. 27 because, even had it been certainthat that loss of profit had been suffered, that type of economic loss falls outside the scope of the tort of negligence.



of suffering from a disease in the future is an actionable head of loss in contract any more thanit is in tort. In particular, the Barker v Corus twin criteria would surely have still been appliedin that case itself, even if the claim against the employer had been framed as one for breachof an implied term in the contract of employment. Despite their Lordships’ tantalising obiterdicta in Rothwell I do not think that the decision as regards the increased risk of sufferingfrom mesothelioma in the future (or, I should add, mental distress consequent on that risk)would, or ought to, have been any different had the pleural plaques claim been framed incontract rather than tort. Indeed if that were not so, all those who were negligently exposedto asbestos so that their risk of contracting mesothelioma was significantly increased, wouldhave a claim for substantial damages in contract against their employers whether they hadpleural plaques or not. And surely Gregg v Scott would have been decided in the same wayif Mr Gregg had been treated privately, and therefore had a concurrent claim in contract,rather than being treated under the NHS.

Thirdly, are the courts irrationally favouring pure economic loss over personal injury giventhat, even after the radical move made in the Barker case, they are more willing to award lossof a chance damages for the former than the latter? On the face of it, the clear answer appearsto be ‘‘yes’’. In our scale of values, pure economic loss ranks as less worthy of protection thanpersonal injury. Moreover, the explanation for the difference towards loss of a chance cannotlie in the controlling restrictions (e.g. the need for an assumption of responsibility) on thescope of recovery for pure economic loss because they are designed to avoid a ‘‘floodgates’’problem (in the usual sense of there being a mass of claims from a single event) that doesnot normally arise where the claimant has suffered a personal injury. Nevertheless, althoughthis is very difficult indeed, it seems to me that the present distinction between the treatmentof chances in relation to pure economic loss and personal injury can be viewed as havinga rational basis. As we have seen, even if there is no floodgates problem, a policy of ‘‘waitand see’’ explains why the courts normally do not allow damages for the materially increasedrisk of a future disease or injury. However, a policy of ‘‘wait and see’’ in relation to pureeconomic loss makes little sense. We are well accustomed in everyday life to putting a presentvalue on future possible economic losses and the very distinction between a present and afuture loss, in relation to economic loss, seems an unreal and unrealistic one. For example,defective goods and flawed assets are exchangeable and need to be assigned values that a‘‘wait and see’’ approach simply does not assist. So in the context of a pure economic lossclaim, or indeed an economic loss claim consequent on property damage, it is natural toassign a present value to the risk of the future uncertainty. Similarly, it is straightforward andnatural to assign a present value to uncertainties as to what the claimant’s financial positionmight have been compared to what it actually is, because, as Baroness Hale stressed in Greggv Scott, ‘‘it is all money’’.46 In contrast there is a qualitative difference–one is not comparinglike with like–between a lost leg and a chance that one might not have lost that leg. It is,therefore, my tentative view that, contrary to one’s strong first impression, the courts are notirrationally favouring pure economic loss over personal injury in this context.

Fourthly, does the loss of a chance approach apply only to questions of quantification asopposed to questions of causation or liability? This was a distinction relied on, albeit skilfullymanipulated, by Simon Brown J. at first instance in Hotson and certainly, as we have seen, inthe context of personal injury and death it is an important distinction. But looked at acrossthe whole range of cases it is, I believe, misleading and unhelpful. So while one might say thatbecause a breach of contract is actionable per se, Chaplin v Hicks concerned quantificationnot liability, one cannot say the same about claims for pure economic loss in the tort of

46At [220].



negligence. Clearly they are concerned with whether there is a cause of action, i.e. liability.Conversely there are questions that seem to go to quantification–for example, whether aninjured claimant has incurred medical expenses or has suffered acute pain–where a balanceof probabilities not a chances approach is applied because the issue is one of past fact. Andeven in the realm of personal injury, Barker v Corus has now accepted that actionable damagecan take the form of a loss of a chance. In any event, the whole question that I have beenaddressing in this article might be said to be a controversy about an aspect of causation. Sooverall I do not think it helps to imagine that loss of a chance applies only at the quantificationstage rather than at the liability or causation stage.

Finally, where are the next developments in this area of the law likely to be? First of all,I think some fruitless time will be spent while claimants exhaust the contractual back-alleyto which they have been directed in Rothwell. Secondly, it seems to me clear that mostattention will then focus on clarifying Barker v Corus. I have suggested that the single agentconcept applied in that case does not reconcile the cases and appears to mask the courts’policy concerns to protect medical practitioners from a mass of single incident claims. It is anillusive concept and it seems inevitable that it will be the source of future litigation. This isnot only because it is hard to see what stops Barker v Corus being applied to ordinary accidentcases but also because no-one has yet convinced me that they are totally sure what is meantby a single as opposed to a multiple agent case.


Periodical Payments after theCourt of Appeal decision inThompstone1

HARRY TRUSTED2

Indexation; Life expectancy; Periodical payments; Very severe injuries

Abstract

In this article Harry Trusted, Counsel for two of the Claimants in the conjoined appeals ofThompstone in the Court of Appeal on the issue of indexation, looks at the Court of Appealjudgment. ML

The judgment of the Court of Appeal in Tameside and Glossop NHS Trust v Thompstone[2008] EWCA Civ 5 is the latest development in the field of periodical payment indexation.The case is referred to in this article as Thompstone, although four separate appeals were thesubject of argument. The Court of Appeal has refused the appellants permission to appealand it is unclear whether and on what issues they may now seek to appeal to the House ofLords. Where does this leave practitioners and what are the policy issues around which thequestions have been determined?

Why were Periodical Payments Introduced ?

The background to the case is of interest. Since the Second World War, catastrophicallydamaged patients have increasingly tended to survive to older age, whereas previously theydied soon after injury. Sufferers from cerebral palsy and other forms of severe brain damage aswell as patients with paraplegia and tetraplegia had very limited life expectancies in the daysbefore antibiotics, steroids and other post-war therapies.

During the 1980s, it became apparent that there were increasing numbers of claimants whohad suffered traumatic injury (either at birth or later) who had potentially very large claims,which would involve lifelong care costs.

1Cojoined cases: Tameside and Glossop Acute Services NHS Trust v Thompstone; South West London Strategic HA vDe Haas; Corbett v South Yorkshire Strategic Health Authority; United Bristol Healthcare NHS Trust v RH [2008]EWCA Civ 5.

2Harry Trusted is the Secretary to the Ogden Working Party and a barrister specialising in personal injury and clinicalnegligence cases at Outer Temple Chambers, London. He can be contacted by telephone on 0207 353 6381 and bye-mail at [email protected]


PERIODICAL PAYMENTS AFTER THE COURT OF APPEAL

As multipliers became more sophisticated and the Ogden Working Party’s reports justifieda more actuarial approach to the compensation of future loss, two trends emerged.

The first was a tendency for damages awards to rise. In general, the pre-Ogden ‘‘broadbrush’’ approaches produced awards that were lower (and, in many cases, very much lower)than awards calculated more mathematically. Hence, in (say) 1990, seven figure awards wererare. By 2000, they were common in many catastrophic injury cases.

As awards rose, defendants became more concerned about issues of life expectancy.Argument and prediction was difficult because it was only comparatively recently that thesepatients survived at all, and the statistical evidence was (and still is), open to interpretativearguments

There have been numerous cases in which the courts have been asked to adjudicate as towhether and in what circumstances life expectancy evidence may be allowed. For instance,in Rawlinson v Cooper [2002] EWCA Civ 392, the Court of Appeal approved the DistrictJudge’s decision to allow life expectancy evidence, in view of the size of the claim and thecomplexity of the issue. But in Arden v Malcolm [2007] EWHC QB 404. Tugendhat J. upheldthe first instance judge’s refusal to allow life expectancy evidence in circumstances whereit was possible for the court to be assisted by clinical experts. It was decided that statisticalevidence would be allowed if (but only if) those experts could not agree.

A different approach was taken by H.H. Judge Macduff Q.C. in Lewis v Shrewsbury NHSTrust [2007] L.T.L. June 14. He held that the statistical evidence should be tabulated andconsidered before the court examined whether the clinical evidence justified departure fromthe statistics.

The ‘‘lump sum’’ system therefore forces the court to make what is often not much morethan a guess as to life expectancy. This can produce perverse results. Claimants may beawarded multi-million pound damages on the assumption that they will live for decades. Ifthey die young, their estates receive a windfall. If, conversely, the claimant survives wellbeyond the expected time, the money will run out and the care will not be provided as thecourt envisaged.

The Damages Act 1996 was amended by the Courts Act 2003 so as to give the court thepower to order the imposition of periodical payments in an appropriate case. This means thatthe defendant may be ordered to make a regular annual payment to the claimant and suchannual payments may form all or part of the compensation payable. In 2006 (the first full yearin which the power to order periodical payments was in force) 16 per cent of all settlementsapproved by the Court of Protection involved periodical payments (see ‘‘Facts and Figures2007/8’’, p.x).

In the context of litigation, the obvious attraction of periodical payments is that theydispose of the life expectancy issue by assuring the claimant a regular lifelong payment.In most of the cases that have so far come before the courts, the tendency has been forsettlements and awards to be on the basis that future care is provided by periodical paymentsand most if not all other heads of loss are resolved by lump sums.

Hence, for instance, in Corbett v South Yorkshire Health Authority [2007] L.S. Law Medical430, H.H. Judge Bullimore approved a capital settlement of just over £1.6 million in respectof all items save future costs of care and case management. There was an issue as to the basisupon which care was to be provided and a further issue as to the indexation of periodicalpayments (see below).

It is likely that, from the point of view of the Government, and, in particular, the NationalHealth Service Litigation Authority, a further attraction of periodical payments is the spreadof future costs. Hence, instead of finding very large capital sums with which to compensatebrain injured babies, the NHSLA now makes annual payments which (in the short term)



lessen the apparent costs. As with ‘‘Private Finance Initiatives’’, the longer term economicsmay be debatable. Fortunately, however, these wider economic issues were not the subjectof argument in the Court of Appeal.

The Significance of the Indexation of Periodical Payments

If payments are made on a regular annual basis, they must be increased to take account ofinflation. The key question is therefore how that inflation is to be calculated and, specifically,by what index the annual payments shall be increased.

The relevant parts of the Damages Act are ss.2 (8) and 2 (9), which read as follows:

‘‘2(8) An order for periodical payments shall be treated as providing for theamount of payments to vary by reference to the retail prices index (withinthe meaning of section 833 (2) of the Income and Corporation Taxes Act1988) at such times, and in such a manner as may be determined by or inaccordance with Civil Procedure Rules.

(9) But an order for periodical payments may include provision-

(a) disapplying subsection (8), or(b) modifying the effect of subsection (8).’’

The reason that these sections have given rise to litigation is that the indexation of theperiodical payment is likely to make a great difference to its cost. The Retail Price Indexmainly measures the rising costs of goods. Earnings indices, by definition, measure the risingcosts of labour. Since the Second World War, the cost of labour has risen much more quicklythan the cost of goods. This is easily demonstrated by reference to ordinary household durables(such as cars and televisions) which have become comparatively cheap whereas items whichdepend on labour (such as restaurant meals and school fees) have become comparativelyexpensive.

In her article ‘‘The Indexation of Future Care Costs’’ for the September 2007 issue ofJournal of Personal Injury Law, [2007] J.P.I.L. 247, Dr Wass pointed out on p.248 that:

‘‘. . .An annual payment of £1,000 in 1963 indexed to the RPI would have risen to£14,483 in 2006. If the salary-based costs of care had risen according to the growthin the AEI Average Earnings Index, these would have risen to £32,841 in 2006.’’

Catastrophically injured patients have high care needs which can only be met by the (moreor less) constant presence of appropriate staff. Hence claimants whose periodical paymentsare intended to meet care costs have sought indexation which will track an earnings index asopposed to the Retail Price Index.

It is important to understand that the financial difference between the two indices mayprove to be substantial, especially if the claimant is likely to live for some decades. Assume,for example, that the claimant lives for forty years and the care claim is £100,000 per year.Each 1 per cent by which the payment is uprated will cost more than £1 million in today’smoney. Hence if 1 per cent represents the differential between RPI and earnings indices, theindexation argument is worth £1 million. In practice (see Dr. Wass’s article) the differentialmay prove to be nearer 2 per cent or 3 per cent if historic trends continue.



It is, of course, impossible to know what will happen in future. It is conceivable that(contrary to expectations on the basis of past experience), the RPI will rise faster thanearnings indices. There have been individual years (such as 2007 and 1995) in which this hashappened, but these have been very much the exceptions.

It is not surprising, therefore, that in all of the cases that have come before the courts sofar, defendants have sought to persuade judges to index periodical payments by reference tothe RPI—and not by reference to the earnings indices which have been proposed by theclaimants’ representatives. In all the reported cases, the defendants submissions have failedand the courts have indexed future losses by reference to earnings indices.

The Argument in Flora v Wakom

The first reported case on this topic was Flora v Wakom [2006] EWCA Civ 1103. Theclaimant was severely injured and the defendant admitted liability. The claimant sought tohave periodical payments uprated by reference to an appropriate earnings index and soughtto adduce the evidence of a labour economist (Dr Victoria Wass). The defendant made anapplication to strike out the applications on the grounds that s.2(9) of the Damages Act onlypermitted departure from the RPI in exceptional circumstances, which did not apply to Flora.

Both Sir Michael Turner at first instance and the Court of Appeal rejected the defendant’ssubmissions. In para.[33] of his judgment (with which Sir Mark Potter and Moore-Bick L.J.agreed), Brooke L.J. concluded that there should a number of cases which would come beforethe Court of Appeal so that the issue of indexation could be fully ventilated and argued.

The cases which were conjoined sub nom Tameside and Glossop NHS Trust v Thompstoneform the group envisaged by Brooke L.J. and the Court of Appeal’s determination of thosecases is of importance to practitioners.

The ‘‘Thompstone’’ Appeals

The cases in the group involved four young claimants, all of whom had lifelong care needscaused by their cognitive and physical disabilities. In all of the cases, liability had beenadmitted and the issue on appeal was whether periodical payments to meet the future costsof care and case management should be uprated by reference to the RPI or by reference to asuitable earnings index.

In all four cases, the first instance judges had decided that the appropriate measure forindexation was the Annual Survey of Hours and Earnings (ASHE). This is an annual surveypublished by the Office of National Statistics and it is a sample of the actual earnings ofemployees. The survey disaggregates its data into different classifications, one of which is‘‘6115’’ deals with care assistants and home carers.

ASHE 6115 is not an index. Dr Wass (whose expert evidence was adduced by claimants inall of the cases) proposed that the weighted average of the claimant’s cost of care (which willvary case by case) should be matched to the appropriate percentile of ASHE 6115. Thereafter,the cost of the care will be tracked to that percentile which will, she argued, reflect thechanging costs of care as accurately as possible.

Following the first instance decisions, all four judges gave permission to the defendantsto appeal to the Court of Appeal so that the indexation issues could be fully argued anddetermined.



The defendants in all four cases were funded by the National Health Service LitigationAuthority, but it is of note that two other organisations made submissions to the Court ofAppeal as interested parties.

Submissions from Interested Parties

The Ministry of Defence submitted (inter alia) that if future costs of care were upratedby reference to earnings indices, this would make it more difficult to maintain the present‘‘in-house’’ system of compensation which used the Retail Price Index to uprate future losses.Those (written) submissions were not the subject of overt comment by the Court of Appealbut, by implication, they failed on the basis that the Court did not consider that this problemwas sufficient to displace its conclusion that the ASHE indexation was appropriate.

The Medical Protection Society also made separate (written) submissions to the effect thatit was not an insurer which was ‘‘secure’’ within the meaning of s.2(3) of the Damages Act1996, it was not therefore able to provide periodical payments. Further, it argued that insofaras it might be ordered to make periodical payments (or insofar as it chose to do so), theadditional costs of providing for ASHE indexation would cause the premiums paid by itsmembers to increase disproportionately. Finally, it was argued that for various reasons ASHEindexation was unsatisfactory.

The Court of Appeal did not accept the Medical Protection Society’s arguments, and theycommented (in para.[96] of Waller L.J.’s judgment) that the substance of the evidence inquestion had been dealt with by Mackay J. and H.H. Judge Bullimore.

The Appellants’ Submissions—‘‘Exceptional Circumstances’’

The appellants submitted that the indexation of periodical payments by reference to the RPIshould only be permitted by the Court in ‘‘exceptional circumstances’’. The defendants’contended that RPI was the default index and that the Court should not depart from thatunless an exceptional reason was demonstrated.

Further, the defendants contended that if periodical payments were uprated by anythingother than the RPI, there would be a risk of the development of a system of compensationwhich was divergent from the discount rate applied to multiplier/multiplicand compensation.The defendants argued that the attempt by claimants to invoke earnings indexationundermined the decisions in such cases as Warren v Northern General Hospital [2000] 1W.L.R. 1404 and Warriner v Warriner [2002] 1 W.L.R. 1703, in which the Court of Appealhad rejected the argument that the discount rate should be reduced to reflect the fact thatcare costs rose faster than RPI inflation.

However, in Thompstone, the Court of Appeal rejected these submissions. In the leadingjudgment at para.[33], Waller L.J. cited the judgment of Brooke L.J. in Flora by which heheld himself bound but with which (at para.[35]) he expressly agreed in any event. Paragraphs[27] and [28] of Brooke L.J.’s judgment were repeated by the Court of Appeal in Thompstone.The key passages are as follows:

‘‘. . .When setting the appropriate discount rate in the context of a lump sumaward, the House of Lords or the Lord Chancellor had to guess the future and tohope that prudent investment policy would enable a seriously injured claimant tobenefit fully from the award for the whole of the period for which it was designedto provide him/her with appropriate compensation.



A periodical payments order is quite different. The risk is taken away from theclaimant. The award will provide him or her year by year with appropriatecompensation, and the use of an appropriate index will protect him/her from theeffects of future inflation. If he or she dies early the defendants will benefit becausepayments will then cease. It is unnecessary in the context of this statutory scheme tomake the kind of guesses that were needed in the context of setting a discount rate.The fact that these two quite different mechanisms now sit side by side in the sameAct of Parliament does not in my judgment mean that the problems that infectedthe operation of the one should be allowed to infect the operation of the other.’’

The Appellants’ Submissions—‘‘Modification’’

The appellants in Thompstone then argued that the use of ASHE 6115 amounted not to a‘‘modification’’ of the RPI, but to a wholesale substitution. Again, the Court of Appeal helditself to be bound by dicta in Flora (in which that submission had been rejected). Again,however, the Court expressed the view that they were against the appellants on the pointsince the modification was not to the index but to the application of s.2(8) of the DamagesAct.

The Appellants’ Submissions—‘‘Distributive Justice’’

The fourth issue raised by the appellants concerned the question of distributive justice. Thedefendants said that even if the claimants were right to assert that earnings indexation wouldproduce mathematically more accurate results, it was against public policy to allow periodicalpayments to become too expensive. Further, they asserted that the inevitable effect of theadditional expense of earnings indexation would be a reduction in funds available for treatingpatients who needed the NHS. Hence, it was argued, the courts should consider how tobalance the competing needs of litigants against the wider needs of society; distributive justicemeant choosing the cheaper means of indexation in order to preserve NHS money for thewider community.

Again, the Court of Appeal held itself to be bound by the decision of Brooke L.J. inFlora at para.[48], but Waller L.J. also rejected the appellants’ submissions. In para.[47] of hisjudgment, he observed that:

‘‘. . . ‘distributive justice’ is not a principle of English law recently adopted so asto allow free rein to ignore basic principles long established. It may come intoplay when considering whether it is fair, just and reasonable to hold that a dutyof care is owed (as in Frost and Rees) or in considering a public policy questionsuch as damages for the birth of a healthy child (as in McFarlane). It is perhaps alsounderstandable how it plays some part in considering the essentially judgementalquestion of whether the level of general damages should be increased (as in Heil),but this is all a far cry from seeking to influence the calculation of actual financialloss where the 100% recovery principle is fundamental. Once liability is establishedand once financial loss is being assessed, it is ‘corrective justice’ and not distributivejustice with which the court should be concerned’’.



The Appellants’ Submissions—‘‘The Legal Burden of Proof’’

The appellants asserted that claimants must discharge a legal burden of proof in order topersuade the Court to depart from the RPI. Waller L.J. (para.[52]) stated that ‘‘In ourview. . .the point was always bad’’. He emphasised that the court was given an inquisitorialrole by the Damages Act and that it was entirely appropriate for the judges to have chosenbetween the variety of indices which had been considered. See, for example, the judgmentof Swift J. in Thompstone [2006] EWHC 2904 (QB).

The Appellants’ Submissions—Criticisms of ASHE 6115

The appellants raised various arguments about the suitability and accuracy of ASHE 6115.These points were separate from the submissions that it was not (for various reasons)appropriate for the Court to have departed from the use of the RPI. The attacks upon ASHE6115 involved assertions that it over-stated wages and/or that it was not an ‘‘index’’ whichprovided a suitable means for uprating periodical payments and/or that the figures derivedfrom ASHE 6115 were prone to volatility and/or reclassification and/or distortion.

Again, the Court of Appeal in Thompstone observed that the defendant’s submission thatASHE 6115 was not an appropriate means of indexation had failed in Flora. In para.[73]of his judgment, Waller L.J. noted that the submissions about the shortcomings of ASHE6115 were expressed as matters of law—in which case they failed in limine because of Flora.However, in view of the nature of the appeal, the Court did deal substantively with theappellants’ objections to ASHE 6115.

In so doing, the Court found against the appellants on all their submissions.At para.[98] of his judgment, Waller L.J. expressly approved the conclusions of Mackay J.

in RH v United Bristol Healthcare NHS Trust [2007] EWHC 1441 who made the followingcomments at para.[87] of his own judgment:

‘‘. . .I regard (ASHE) 6115 as the most accurate match to the target expenditure;it is of undoubted authority, coming from the ONS; it is statistically reliable as allagree, with tight CV’s; it is freely accessible, albeit with a time lag problem whichI believe can be overcome; it is consistent over time past, although it does not goback beyond 1997, not a serious flaw in my view; it is reproducible in future’’.

Practical Issues arising from the Power of the Court to Impose

Periodical Payments

The next group of issues concerned practicalities. The Court of Appeal noted that theamendments to the 1996 Damages Act created a new power and gave a new responsibilityto the court—namely whether and in what circumstances to order the imposition of aperiodical payment. This might include circumstances where the parties did not wish to havea periodical payment, but the Judge felt it appropriate so to order. Section 2 (1) (b) of theDamages Act obliges the court to consider whether to do so, and CPR Pt 41.7 reflects thisprovision.



Practice Direction to CPR 41 lists the factors to which the court must have regard, whichinclude the scale of the payments, the preference of the claimant, the advice given to theclaimant and the preference of the defendant.

In RH a practical problem had arisen although the parties had reached agreement onthe quantum of each head of loss and on the applicable multipliers. These agreementswere approved by Owen J. on February 5, 2007. The outstanding issues were thereforethe indexation of periodical payments and a separate question as to the size of the capitalcontingency fund. The claimant sought a larger contingency fund on the basis that he wishedto install a hydrotherapy pool. The defendant proposed a smaller contingency fund (andhigher periodical payments). The point at issue was not the recoverability of the hydrotherapypool (since this point had been compromised in the overall settlement); the question waswhether the discretion to order periodical payments should be invoked to oblige the claimantto accept a smaller capital sum.

At first instance, Mackay J. noted that the defendant’s financial adviser accepted that theclaimant’s adviser’s proposal (for the higher contingency fund) was not unreasonable. In thelight of this, at paras [113] and [114] of his judgment, Mackay concluded that:

‘‘It is not, therefore, open to the defendant to challenge this proposal, or put forwarda counter proposal, merely on the basis that there is another way of arranging theaward that suits its own interests better. Its role in this exercise is a very limited one,and in view of the respective positions of the IFA experts in this particular case, itdoes not come into play . . .

113. I therefore rule that the claimant’s format should be adopted in this case.’’

The Court of Appeal in Thompstone approved Mackay J.’s approach and held that it wouldonly rarely be appropriate for a defendant to call its own Independent Financial Adviser(para.[111] of the judgment of Waller L.J.), since it was likely that the claimant would beadvised by an experienced expert and a responsible legal team.

RH disclosed another problem. Owen J. had approved the settlement of many issues, butMackay J. then heard argument about the outstanding points. There was a question as towhether it was appropriate for Mackay J. to see the advice prepared for Owen J., althoughthe defendant had not seen that advice. As Waller L.J. observed in para.[130] of his judgment,the problem was unusual because in most cases, the judge giving the approval would also dealwith the indexation issues. He concluded that in those unusual cases, it ought to be possiblefor the parties to agree to redact those portions of the Advice which were ‘‘sensitive’’ so thatthe rest of it could be shown to both the judge and the defendant.

Conclusions

Periodical payments provide an accessible means of future compensation for claimants whohave long term care needs. They are particularly useful in cases which involve uncertainlife expectancy. Parents of gravely disabled children will be reassured by the knowledge thathowever long their child lives, there will be regular payments to meet the costs of care.Insurers will know that their liability will not extent beyond the life of the claimant and thereis no risk of windfall in the event of early death.

The Court of Appeal has, for the second time, endorsed the principle that periodicalpayments offer a mechanism of compensation that is fundamentally different from the



multiplier/multiplicand system. In those circumstances, it is reasonable for the parties to finda means of future indexation which matches the likely changes as accurately as possible.ASHE 6115 is the best such mechanism—and it is likely to be the starting point for theindexation of periodical payments which are designed to meet care and case managementcosts which may be arise many years after today’s lawyers have hung up their robes.


procedure

The Future of Personal Injury: TheHigh Street Practitioner

JOHN MCQUATER1

Human rights; Law firms; Legal history; Legal services; Personal injury;Regulation; Rule of law; Solicitors

Abstract

This article considers the potential effect of forthcoming regulatory changes in the legalsector on high street firms, looking in particular at personal injury work undertaken bythese firms and the impact all of this may have on wider issues including access to justiceand the rule of law. JM

‘‘High street’’

It is difficult to define precisely what is meant by ‘‘high street’’ solicitors. If, for presentpurposes, this is taken to be most firms with four partners or less, figures provided by theLaw Society for 2006, show the importance of this sector of the profession.

In Yorkshire and Humberside for example, there were just over 600 firms in 2006. Ofthese 254 were sole practitioners and a further 260 were two to four partner firms.

So, out of around 600 firms in the region, over 500, 85 per cent, could probably beregarded as high street firms.

Whilst a few of these smaller firms might not be high street firms, it is fair to say that themajority of 5–10 partner firms probably would. If those 5–10 partner firms in the region areincluded within the definition of a high street practice, the percentage of such firms increasesto 95 per cent. Indeed, there were only 28 firms in the region, in 2006, with more than 11partners.

Throughout the country as a whole in 2006, sole practitioners represented 46.3 per centof all firms and two to four partners 40.7 per cent, very much the same as in Yorkshire andHumberside. Add in 5–10 partner firms and you again discover 95 per cent of firms are whatmight be termed high street solicitors.

Moreover whilst, because of the sheer size of those firms, many solicitors work in verylarge concerns, the number of smaller firms means that out of the 80,000 or so solicitors inprivate practice in 2006, more worked in two to four partner firms than any other size offirm, including those employed in the very large, 81 plus, partner firms.

1John McQuater is a partner at Atherton Godfrey solicitors in Doncaster. He is also a member of the J.P.I.L. EditorialBoard. He can be contacted at [email protected].


[2008] JOURNAL OF PERSONAL INJURY LAW—PROCEDURE

Despite these numbers, the term high street when applied to firms of solicitors, has becomerather pejorative over recent years. That might be justified if it were describing a standard ofservice which is not specialised and efficient but wholly wrong if it seeks to denigrate lawyersproviding services to individuals rather than commercial organisations.

Indeed, given the number, visibility and access of smaller firms their role is vital, in termsof access to justice, because it is through these firms the legal needs of so many individualsare met.

If there is no proper access to justice, the whole idea of the rule of law, which shouldunderpin our society, begins to break down.

The 2006 figures, as well as revealing a large number of small firms, show the very greatvariation in size of firm. Historical developments, over the last few decades, may account forthis.

History

It is not so long ago that most firms would be regarded as a high street practice, except for asmall number of firms in the City of London and perhaps a handful of major regional centres.

Indeed until 40 years ago the law did not permit partnerships of more than 20 and evenwhen this restriction was removed, growth of firms was, initially, slow.

However, the last 20–25 years has seen the development of a number of very large firmsand, to some extent, the polarisation of the profession.

The introduction of the legal aid scheme following the war, which remained largely inplace until quite recently, allowed much better access to legal advice across a range of subjectsand, like so many post-war reforms, had the effect of greater equality, access to justice nolonger depending upon financial resources.

During this time many firms were willing to undertake legal aid work and, except perhapsfor the largest firms, there was no clear demarcation between firms dealing with differenttypes of client. This was reflected by the more common practice of, in the context of personalinjury claims, firms doing some defence work, for insurers, as well as acting for individualclients pursuing claims.

Much of that has now changed. Many firms, particularly those away from the high street,have dropped out of legal aid altogether. Statistics confirm that many small firms survive butthe largest firms have seen significant growth and have moved away not only from publiclyfunded work but also, in many cases, private client work altogether.

Having looked at the historical perspective to the current statistics, it is worth consideringwhere this leaves us today in terms of how polarisation has impacted on client choice andaccessibility.

Today

Growth in the range of size has often been mirrored by polarisation in the types of workundertaken by large and small firms respectively.

There are, of course, some firms occupying the middle ground who do work for privateclients, perhaps including publicly funded work, along with commercial work. However,the general trend has been for firms to gravitate towards entirely commercial work or largely


THE FUTURE OF PERSONAL INJURY: THE HIGH STREET PRACTITIONER

private client work. There is even a degree of polarisation in private client work, some firmsspecialising in what are termed ‘‘high net worth’’ individuals.

Of course different types of legal consumer have different needs, which are probably bestmet by different firms. But surely most lawyers would agree that for the rule of law to meananything, it is important consumers have access to lawyers who can ensure an outcome basedon justice, not the resources of those individuals or even the resources of the firms thoseindividuals choose to instruct.

Given the numbers of high street firms, and the large amount of work undertaken bysuch firms for individuals, the future delivery of these services, in whatever form that mighttake, would seem to be an important issue. Before looking at future possibilities for dealingwith work for those clients currently instructing high street firms it is, perhaps, necessary toconsider the reasons why the legal landscape may be set to change over the next few years.

Regulation

It is well known that following the Clementi Review, regulatory changes, intended to open upthe legal marketplace, are taking place.

An important change will be the opportunity for outside investment in solicitors firms.Traditionally, as a profession, we have regulated ourselves and practised in partnershiponly with other solicitors, restricting the investment in firms to that given by our fellowprofessionals.

The opportunity for investment, coupled with de-regulation, is a real force for change andseen as a threat to the high street firms because of the risk that work undertaken by thesefirms will be a target for larger firms, and other players, interested in commodification of thatwork and dealing with it in volume.

But what is driving forward these regulatory changes and are there other factors at work?

Drivers for change

At face value the Government agenda appears to be based on the idea of consumerism. Thethinking is that, by opening up the market, there will be greater consumer choice.

However, as the Law Society has pointed out, there are dangers in adopting a purelybusiness approach to a professional service. These dangers are the tension between the ideaof even-handed justice, given in accordance with the rule of law, and the consumerist ideaof purchasing power. That outlay in legal fees will somehow influence the outcome by thedeployment of greater resources.

That is not to say legal firms should not be run in a businesslike way, intended to make aprofit by harnessing technology and efficient working practices. However, the priority mustremain the interest of each and every client and, more generally, upholding the rule of law,as the Solicitors’ Code of Conduct 2007 makes clear.

All of this might raise questions about the extent to which the thinking is joined up: doesa consumer driven approach really sit comfortably with the core values set forth in the 2007Code?

Factors, above and beyond a consumer approach to regulation, are also at play, particularlyaffecting a range of work currently undertaken by many high street firms.



Information technology increasingly has an effect, especially on work that can be systemised.The computer in the 21st Century is likely to have the same effect on latter day cottageindustries as the steam engine did on similar enterprises in the 19th century.

Whilst there is nothing to stop smaller high street firms taking full advantage of newtechnology, the usual result of commoditizing work is lower margins with the consequentneed to increase volume, something that smaller firms will inevitably find challenging.

There is also the issue of referral fees. Firms that can drive down costs, and increase volume,are in a position to pay larger referral fees with consequent further downward pressure onthe cost of work production. At some point this inevitably affects the quality of service.

In these circumstances does it matter if, provided the legal needs of those clients likely tobe affected by these changes are still met, the focus for delivery may shift from the accessible,personal, service of a high street firm to the more remote, impersonal, ‘‘factory’’? On thisquestion choice of legal provider surely remains important.

Choice

Much of the work undertaken by the independent high street firms concerns individuals,often in dispute with larger organisations.

It is worrying that, in an increasingly regulated society, there seems to be little enthusiasmfor anyone who seeks to assert, let alone argue for, individual rights. That, however, makesthe future existence of the lawyer operating with the key precepts of independence, integrityand confidentiality essential. There is, surely, some connection between the opportunity forchoice and independence.

Personal injury claims are an example of the type of work where many clients currentlychoose a local high street firm. Some of this work is suited to commoditization, and thereis nothing wrong with efficiency and best practice, but many clients require, or wish for, apersonal service.

If, for the reasons already considered, this and similar types of work disappear from the highstreet, a whole raft of clients, mainly individuals of relatively modest means, become deprivedof the opportunity for a local, personal service across a range of issues, many involvingindividual rights.

In these circumstances, even if the legal needs of these clients can be met elsewhere, is itreally right that the client, or in the new parlance, a consumer, should be deprived of choiceand perhaps referred simply to the highest bidder? Certainly the more resourced individualand commercial concern, is unlikely to accept any such limitation in choosing the supplier oflegal services.

A firm does not deserve to survive simply on the grounds of historical location and practicesbut if consumer interests are really to be respected that must involve a free choice between arange of different service providers and equality of access to appropriate independent advice.

Whilst all of this concerns the means by which those in the legal profession deliver servicesto the client, will future changes have an effect on the professions themselves?

Legal professions

The most recent Code of Conduct suggests, whatever regime prevails following regulatorychanges, legal services are still likely to be delivered by professionals operating in accordancewith a code reflecting many traditional values.


THE FUTURE OF PERSONAL INJURY: THE HIGH STREET PRACTITIONER

Accordingly, the professions may not change too significantly, certainly for the immediatefuture, but the way in which members of those professions deliver legal services may, it isthought, change sooner rather than later. However, there are very different views about whatthe future may hold, especially for the smaller high street firm.

The future

What are these very different views?One view which was expressed by Richard Susskind writing in The Times on October

23, 2007, argued that many legal firms, and perhaps even the wider profession, are on thebrink of extinction. His reasoning is based largely on the failure to keep up with advancingtechnology.

Kerry Underwood, writing in The Solicitors Journal on October 5, 2007, takes a quitedifferent view. He makes the point that larger firms are geared up for, and suited to, theneeds of the business client, yet it is the smaller high street firms that are perfectly placed,both geographically and psychologically, to provide the personal service the individual clientwants.

It remains to be seen which is the more accurate prediction for the future.

Conclusions

If forthcoming changes do indeed see the demise of the high street firm, and the loss oflocal firms undertaking personal and other private client work, that will surely not serve theinterests of either consumer choice, access to justice or the rule of law well.

To survive, high street firms do not necessarily have to grow large but must be able todeliver quality services that will attract the client offered a range of providers.

The drive towards consumer choice will be rendered rather hollow if, in the event, there isno real choice in the delivery of legal services except for the well-resourced and sophisticatedlegal consumer. Indeed, this scenario would decrease, rather than increase, access to justiceand risk an outcome based on resources rather than merits.

The changes which face the legal world, and which may impact particularly upon smallerhigh street firms, are, perhaps, just a very small part of the changes sweeping around theworld in the early part of the 21st century, encompassing issues such as globalisation,commercialisation, information technology and even terrorism. However, this small part ofthat broad picture is important because it impacts directly on something that should underpinsociety’s response to all these issues, namely the rule of law.


Forum Non Conveniens in the US:Are the Courtroom Doors FinallyShut?

By MICHAEL MCPARLAND1

Forum non conveniens; Pharmaceuticals; Product liability; Public interest;United States

Abstract

In the light of recent US federal and state court decisions in the Vioxx,2 Factor VIII & IXBlood Concentrate Products3 and the Baycol-Lipobay4 cases, all dismissing pharmaceuticalproduct liability actions brought by British claimants applying the US doctrine of forumnon conveniens, are the doors of US court rooms now firmly shut to similar Britishpharmaceutical product liability claims where large numbers of actions are pending inthe US? MM

Introduction

In 1794, the USA entered into a treaty of ‘‘Amity, Commerce and Navigation’’ with KingGeorge III and Great Britain.5 This treaty declared that there should be, ‘‘firm, inviolable anduniversal peace, and a true and sincere friendship’’ between the two countries. A key elementof the treaty was Art.II, which guaranteed the ability of each country’s citizens, ‘‘freely tocarry on trade and commerce with each other’’.6 To help achieve this, the two countriespromised to cause, ‘‘speedy and impartial justice to be done’’7 in their court systems to thecitizens of the other. The treaty was the first of many with other nations which promised

1Michael McParland is a Barrister and Attorney at Law, State Bar of California. He can be contacted at Quadrant Chambers,Quadrant House, 10 Fleet Street, London, EC4Y 1AU and by e-mail at [email protected].

2In re Vioxx Litigation [2006–2007] New Jersey.3Gullone v Bayer, 408 F. Supp. 2d 569; and (on appeal) at 484 F.3d. 951.4Michael Lake and June Lake v Bayer Corporation, Bayer AG and Bayer Plc [2006], Connecticut.5The treaty is known in the US as the Jay Treaty where it is (still) a controversial document. In Britain, it is known (ifat all) as the Treaty of London. Legally, it is most famous for introducing a form of international arbitration to resolvedisputes left over from the War of Independence.

6One of the permanent articles of the Treaty: see Art.XXVIII.7Art.II of the Treaty in its final clause:

‘‘As this article is intend to render in great degree the local advantages of each party common to both, andthereby to promote a disposition favourable to friendship and good neighbourhood, it is agreed that the


FORUM NON CONVENIENS IN THE US

non-discriminatory reciprocal access to the signatories’ courts.8 The goods traded betweenthe two countries in the intervening two centuries may have changed, but the principle ofthe right to ‘‘speedy and impartial justice’’ on both sides of the Atlantic should not have.

However, recent years have been particularly bad for British citizens seeking to exercisethat right in US courts in claims arising out of products manufactured in the US and soldabroad. In the Vioxx litigation, the Factor VIII or IX Concentrate Blood Products litigation,and the Baycol-Lipobay litigation, British litigants have been denied the right to sue US drugmanufacturers in the US by the application of the doctrine of forum non conveniens (FNC).It was argued in the 1990s that the doctrine of FNC had simply become an effective tool(indeed a ‘‘defence’’) used by US corporate defendants to avoid trial for harm caused by theirproducts in foreign countries.9 By 1999, it could be said with force, that:

‘‘[t]he clear trend in the 1990s has been for American courts to dismiss actionsbrought by foreign plaintiffs under products liability theories of recovery.’’10

The contents of the decisions in 2006-2007 call into question whether or not US courtswill ever entertain a product liability action brought by a foreign claimant as part of mass tortlitigation in the US in circumstances where the drug was administered abroad. In particular,they raise the question of whether ‘‘court congestion’’ in the US will effectively be a decisivefactor, and whether the UK will always be regarded as an adequate alternative forum, even ifcircumstances and evidence suggest there is likely to be extreme difficulty in finding fundingto enable the claim to be brought. This article seeks to consider these developments whileproviding UK lawyers with a guide to the issues that arise in the application of the US FNCdoctrine.

The principles of the federal FNC doctrine summarised11

Under the black-letter federal FNC doctrine, a US federal district court may dismiss a caseover which it has jurisdiction:

‘‘when an alternative forum has jurisdiction to hear the case, and when trial inthe chosen forum would ‘establish. . . oppressiveness and vexation to a defendantout of all proportion to plaintiff’s convenience’, or when the ‘chosen forum[is]inappropriate because of considerations affecting the court’s own administrativeand legal problems’.’’12

respective Governments will mutually promote this amicable intercourse, by causing speedy and impartialjustice to be done, and necessary protection to be extended to all who may be concerned therein’’.

8See Wilson, Access-to-Courts Provisions in US Commercial Treaties, 47 Am. J. Int’l L. 20. (1953), listing 17 such treaties.The modern equivalent includes at least 45 bilateral investment treaties between the US and foreign countries. See fore.g. Born and Rutledge, International Civil Litigation in United States Courts, 4th edn, (2007) on these treaties.

9See Davidson-Major, One-Way Ticket Home: The Federal Doctrine of Forum Non Conveniens and the International Plaintiff,(1992) 77 Cornell L.R. 650 ; Dunham & Gladbach, Forum Non Conveniens in the 1990s, (1999) 24 Brook. J. Int’l. L.665 .

10Dunham & Gladbach, Forum Non Conveniens in the 1990s, (1999) 24 Brook. J. Int’l. L. 665, 666-67.11The literature on this subject is voluminous. For the best introductions and further reading I suggest the works by

Born and Rutledge, International Civil Litigation in United States Courts,4th edn (2007); Brand and Jablonski, Forum NonConveniens, History, Global Practice and Future under the Hague Convention on Choice of Court Agreements (2007); Fellas,Transatlantic Commercial Litigation and Arbitration (2004); Scholes & Hay, Conflict of Laws, 2nd edn (1992); Fawcett (ed),Declining Jurisdiction in Private International Law (1995). I am indebted to the insight of these authors.

12Piper Aircraft Co v Reyno [1981] 454 US 235, 241 [1981] (quoting Koster v (American) Lumbermens Mut. Casualty Co[1947] 330 U.S. 518, 524.



Essentially, this federal FNC doctrine involves the determination of two questions:

(a) First, is there an ‘‘adequate alternative forum’’ available?(b) If so, then the second question is whether as a matter of discretion, the trial judge should

decline to exercise jurisdiction. That discretion is to be exercised by the balancing ofso called ‘‘private’’ and ‘‘public’’ interest (or convenience) factors. Those factors areweighed against the convenience of the plaintiff’s choice of forum, with a foreignplaintiff’s choice of forum being entitled to ‘‘less deference’’. If these factors weighstrongly in favour of the litigation being conducted in the alternative forum, then thejudge should dismiss the action on the grounds of forum non conveniens.

The FNC doctrine and state courts

Virtually all US states have adopted some form of federal FNC doctrine.13 A tiny minority donot. For example, the FNC doctrine does not exist in Montana and Rhode Island.14 However,significant distinctions still apply between the US Federal and individual state doctrine. Forexample, Delaware, spiritual home to most US corporations, requires ‘‘overwhelminghardship’’ before it dismisses an action.15 It has been said that Delaware’s FNC doctrine isthe ‘‘most restrictive’’16 in the US. The Michigan Supreme Court has defined its own listof private and public interest factors, similar to, but not identical to the US federal rule.17

The Texas Supreme Court abolished its state doctrine in Dow Chemical Company v CastroAlfaro,18 only to find the Texas legislature enacted legislation permitting the application ofthe doctrine where foreign plaintiffs sue US defendants for personal injuries suffered abroadresulting from violations of Texas or US law.19

Federal courts

All US federal district courts will apply this FNC doctrine, which is where most foreignerswill end up, with a defendant seeking the ‘‘removal’’ of any state court action to federalcourt (as discussed further below). Therefore, it is the federal FNC doctrine, and those keyquestions, that need to be understood in greater detail.

Stage one: an adequate alternative forum has to be found to exist

The starting point of any FNC analysis is establishing that there is another forum in which thecase can be tried. The Supreme Court in Gulf Oil v Gilbert20 noted that the ability of a court

13See for e.g. McMahon, Annotation, Forum Non Conveniens Doctrine in State Court as Affected by Availability of AlternativeForum, (1987 & Supp. 2005) 57 A.L.R. 4th 973.

14Save for child custody cases.15See for e.g. Candlewood Timber Group, LLC v Pan American Energy, LLC, 859 A. 2d 989 (Del. 2004).16See Philip I. Blumberg, Asserting Human Rights Against Multinational Corporations Under United States Law: Conceptual and

Procedural Problems, (2002), 50 Am. J. Comp. L. 493, 525 .17Radelijak v DaimlerChrysler Corp [2006] W.L. 2022233 .18786 S.W. 2d 674 (Tex. 90)19Tex.Civ. Prac & Rem Code ANN. §71.051(i).20Gulf Oil, 330 US 501, 506–507.



to decline jurisdiction could only apply if an adequate alternative forum existed. This is athreshold requirement and not part of any discretionary analysis. Only if there is an adequatealternative forum must the court then weigh the relative conveniences to the parties againstthe presumption of the plaintiff’s forum selection.21 But the Court gave no guidance in GulfOil as to what would constitute an adequate alternative forum other than simply indicatingthat it would be one in which the defendant was ‘‘amenable to process’’:

‘‘In all cases in which the doctrine of forum non conveniens comes into play, itpresupposes at least two forums in which the defendant is amenable to process; thedoctrine furnishes criteria for choice between them.’’22

The idea of the adequate alternative forum being essentially a matter of whether or not thedefendant could be made subject to the jurisdiction of the foreign court, was restated in TheRestatement (Second) Conflict of Laws §84 comment c.(1971), where it was said, ‘‘the actionwill not be dismissed unless a suitable alternative forum is available to the plaintiff’’, and:

‘‘the suit will be entertained, no matter how inappropriate the forum may be, if thedefendant cannot be subjected to jurisdiction in other states.’’

In Piper Aircraft Co v Reyno,23 the Supreme Court said that this was a matter that mustbe determined ‘‘at the outset of any forum non conveniens inquiry’’. However, the oneexample given by the Supreme Court in Piper24 in which they indicated that dismissalwould not be appropriate, was where the alternative forum does not permit litigation of thesubject matter of the dispute. The Court cited the decision of Phoenix Canada Oil Co Ltd vTexaco, Inc25where the trial court refused to dismiss the action on the basis of FNC wherethe alternative forum was Ecuador, and it was unclear on the evidence that an Ecuadoriantribunal would hear the case, and there was generally no codified Ecuadorian legal remedyfor claims in unjust enrichment and torts claims that were asserted.

The consequence of this vagueness is that while the US defendant bears the burden ofproving that there is an adequate alternative forum, this they will seek to do by effectivelytwo methods:

(a) Confirming to the court that they would be happy to submit to the jurisdiction of thealternative court, and this is often achieved as a term of dismissal of FNC. A commonseries of conditions imposed on defendants is to consent to jurisdiction and acceptservice, to waive any statute of limitations defence (for at least a specified period) andto consent to pay any judgment awarded. In addition, defendants are often requiredto provide any documents or witnesses within its control (at its own expense) for thefair adjudication of the claims.26 (The defendant’s willingness to offer to submit to such

21Pain v United Technologies Corp., 637 F.2d 775, 784 (D.C. Cir. 1980), cert. denied, 454 US 1128 (1981).22Gulf Oil, 330 US 501, 506–507.23Piper Aircraft Co v Reyno, 454 US 235 (1981).24In footnote 22 to p.254 of the Piper judgment25Phoenix Canada Oil Co Ltd v Texaco, Inc, 78 F.R.D, 445 (Del. 1978).26See for e.g. Dahl v United Technologies Corp, 472 F. Supp. 696 (D. Del. 1979); Harrison v Wyeth Laboratories, 510 F. Supp.

1 (E.D. Pa. 1980).



conditions is no doubt tempered by the fact that they believe there is usually a very smallprospect of the foreign litigation actually going ahead);27 and

(b) By showing that civil claims of some sort can be brought in the foreign country for theunderlying facts in dispute.

However, once the alternative jurisdiction is available on the grounds of service/submissionby the defendant, the foreign forum is not rendered inadequate in the ordinary case because ofdifferences in substantive laws between the US court and the foreign court. As the SupremeCourt held in Piper Aircraft:

‘‘[t]he possibility of a change in substantive law should ordinarily not be givenconclusive or even substantial weight in the forum non conveniens inquiry’’28. . .‘‘dismissal on grounds of forum non conveniens may be granted even though thelaw applicable in the alternative forum is less favourable to the plaintiff’s chance ofrecovery.’’29

If that were not the case, the Supreme Court reasoned that dismissal on the basis ofFNC would almost always be improper and ‘‘the forum non conveniens doctrine [will]become virtually useless’’.30 Thus the fact that, for instance, the UK does not provide certainfavourable substantive laws found in the US or normally provide for punitive damages, orthat the scale of damages is lower than in the US are all irrelevant to the US FNC doctrine.The same applies for the absence of jury trials, or discovery advantages that are available in theUS. All are irrelevant to the analysis of the adequate alternative forum save for exceptionalcircumstances, which overlap with the ‘‘no remedy at all’’ exception discussed later.31

The ‘‘no remedy at all’’ exception

It is only in very limited circumstances where differences in foreign substantive law wouldbe a factor in the FNC analysis, and that is where the ‘‘remedy’’ on offer would in effect be‘‘no remedy at all’’:

‘‘. . . if the remedy provided by the alternative forum is so clearly inadequate orunsatisfactory that it is no remedy at all, the unfavourable change in law may begiven substantial weight; the district court may conclude that dismissal would notbe in the interests of justice’’.32

27See for example the work of David W. Robertson, Forum Non Conveniens in America and England: ‘‘A Rather FantasticFiction, (1987),103 LQR 398 , which showed how few actions which are dismissed on FNC grounds actually go to trialin a foreign court. This article is discussed further later.

28Piper Aircraft [1981] 454 US 235, 247.29Piper Aircraft [1981] 454 US 235, 250.30Piper Aircraft [1981]454 US 235, 250.31For e.g. in a securities fraud case, the absence of a class action mechanism and a lack of a cause of action based on a

fraud on the market theory created ‘‘virtually insurmountable concerns regarding the adequacy of the foreign forum’’:In re Lernout & Hauspie Securities Litigation, 208 F. Supp. 2d. 74, 92 (D. Mass. 2002). Furthermore, where the foreignforum did not allow injunctive relief but might limit the claimant to an administrative remedy that was considered aninadequate remedy: National Hockey League Players’ Association v Plymouth Whalers Hockey Club, 166 F. Supp. 2d. 1155(E.D. Mich. 2001).

32Piper Aircraft Co. v Reyno [1981] 454 US 235, 254 .



But what does ‘‘no remedy at all’’ mean? If the foreign court did not provide a remedy atall, why should that fact not be dispositive of the issue rather than simply a factor carrying‘‘substantial weight’’?33 Case law after Piper highlighted areas of US law in which there wasthen no comparable claim in the foreign court. For example, in Laker Airways Ltd v PanAmerican World Airways,34 the judge refused to dismiss the late Freddie Laker’s company’saction against a series of European airlines for anti-trust claims under The Sherman Act,because:

‘‘. . . British substantive law. . .fails entirely, for a number of reasons, to recognizeliability for the acts which the defendants are alleged to have committed. That beingso, this case is precisely within that group of cases which the Supreme Court inPiper said should not be dismissed. It is difficult to see how it could be otherwise. Itwould be a cruel hoax on the plaintiff to oust it from a court where its allegations,if proved, would entitle it to recovery, and to relegate it instead, in the name of‘‘convenience’’, to a tribunal which, on the facts alleged, would not be justifiedunder its own laws in entering judgment in the plaintiff’s favour. . .’’

In extreme cases, strong evidence of bias, or judicial corruption, in circumstances whereit could be said that it was highly unlikely that a plaintiff could obtain basic justice mightsuffice.35 But the usual case involves a defendant contending that there is a roughly comparableclaim that can be brought in the foreign jurisdiction.

The Factor VIII/IX Blood Concentrate Litigation: Gullone v BayerCorp [2006]

This typical situation is readily exemplified by the recent decision in the Factor VIII or IXConcentrate Blood Products Litigation case of Gullone v Bayer Corporation [2006].36 In Gullone,eight British litigants had sued, alleging that they had contracted either the HIV virusor the Hepatitis B or C virus by exposure, either directly or indirectly to blood-clottingproducts manufactured by four defendants for use by haemophiliacs.37 These products weremanufactured in the US, but were distributed and caused injury in the UK.

The Gullone case was part of the second generation of lawsuits in America. The firstgeneration of cases had essentially been negligence-based claims. These were resolved in 1997through a settlement.38 The second-generation claims were based on knowing misconductdirected towards victims outside the US. The claim was that the defendants, having becomefully aware of the risk of viral contamination involved in their untreated concentrates,fraudulently concealed that risk and ‘‘dumped’’ their untreated products on unsuspectingforeign markets. Gullone was transferred from the federal court for the Northern District of

33A query raised by District Judge John F. O’Grady in Gullone v Bayer [2006] 408 F. Supp. 2nd, 569 .34Laker Airways Ltd v Pan American World Airways, 568 F. Supp. 811 (D.D.C. 1983).35For e.g. Vaz Borralho v Keydril Co., 696 F.2d 379 (5th Cir. 1983); Eastman Kodak Co. v Kavlin, 978 F. Supp. 1078 (S.D.

Fla. 1997).36Gullone v Bayer, 408 F. Supp. 2d 569; and (on appeal) at 484 F.3d. 951.37The four defendants were Bayer Corporation (an Indiana company), Baxter Healthcare Corporation and Armour

Pharmaceutical Company Inc, (both Delaware companies) and Alpha Therapeutic Corporation, (a California company).38In Re Rhone-Poulenc Rorer, Inc., 51 F.3d; In re Factor VIII or IX Concentrate Blood Prods. Litig., 159 F.3rd (approving the

settlement).



California for pre-trial proceedings to the federal court of the Northern District of Illinois(Eastern Division). There, District Judge John F. Grady heard the defendants FNC motion.39

Judge Grady dismissed the US actions on the basis of the federal FNC doctrine consideringthe UK as an adequate alternative forum, not least because he accepted the opinion of MrNicholas Underhill Q.C. instructed as an expert for the defence, that an English court wouldallow the action to be brought on the basis of negligence rather than in fraud.

The plaintiffs, on essentially two grounds, disputed this conclusion. First, Professor AdrianBriggs gave expert evidence expressing uncertainty as to the applicable substantive lawany English Court would apply.40 The question was where would the cause of action beconsidered to have arisen? Was it in the US where the concentrates were manufactured,or as it is in the UK when they were distributed and caused injury? This is an importantissue, as a determination of the applicable law governing the tort is crucially important for anEnglish judge. Judge Grady summarily dismissed this argument, with a somewhat Nelsonicand circular flourish, saying:

‘‘[. . .]we find his discussion difficult to follow, and it does not undermine our beliefthat Mr Underhill is correct in his opinion that a viable negligence action would liein the U.K.’’41

Secondly, the question of whether or not a claim in negligence could be brought inEngland because of difficulties caused by the traditional ‘‘but for’’ requirement of causation.The plaintiffs’ other expert witness, Mr Mark Mildred had highlighted the limited exceptionto this principle set out in Fairchild v Glenhaven Funeral Services Ltd,42 but expressed uncertaintyas to the scope of the Fairchild principle and expressed a belief that it might not apply to theGullone plaintiffs. As a consequence, the US judge determined himself how likely it is thatthe plaintiffs would come within Fairchild. Judge Grady, (whether or not one agrees with hisconclusion) conducted a detailed analysis of Fairchild and its implications.43 He concludedthat it was ‘‘indistinguishable from Gullone’’,44 and concluded that:

‘‘the ‘but for’ rule of causation generally applicable in the UK- and as well in allUnited States jurisdictions we are aware of - is very unlikely to be applied to theGullone plaintiffs should they file in the UK. Consequently, the rule does not makethe UK an inadequate forum.’’

The Seventh Circuit Court of Appeal agreed with the judge on both these matters.45

Therefore, while it seems reasonably clear that the claimants in Gullone would have toeffectively establish ‘‘new law’’ in any claim in England, the US court was quite happy forthem to attempt it.

39Gullone v. Bayer, 408 F. Supp. 2nd , 569 (2006).40Presumably under ss.11 and 12 of the Private International Law (Miscellaneous Provisions) Act 1995. The work of the

English and Scottish Law Commissions that underpinned that choice of law reform in tort was exceptionally vague andinconclusive on the subject of product liability.

41P.5 of Westlaw transcript of Gullone.42Fairchild [2003] 1 A.C. 32.43The defence said little about the decision for obvious reasons.44P.7 of the Westlaw Transcript of Gullone.45Gullone, 484 F.3d. 951.



Factors which do not make the UK an unsuitable forum: lack of

funding

These recent product liability cases also highlighted factors, which the US courts clearlydo not believe render the UK an inadequate alternative forum, which were no doubtcrucial considerations for the British plaintiffs in seeking to bring the actions in question. Inparticular, the question of available funding. There was existing authority that the absenceof contingency fees in the UK has not been regarded as a factor that should ‘‘significantlyinfluence the forum non conveniens determination’’.46 However, it is increasingly clear fromboth the Vioxx Litigation and the Gullone decision in particular, that US courts are preparedto treat the existence of CFA agreements as essentially comparable to contingency fees, andtake a rather rosy view of the discretion contained in CPR 44 regarding the scope of the‘‘loser pays’’ rules.

The Vioxx litigation

The Vioxx litigation action was brought in the New Jersey state court by 98 plaintiffs residingin England and Wales against Merck & Co, Inc, the developer and manufacturer of theprescription medicine Vioxx (rofecoxib), an arthritis and acute pain medication. The actionwas also brought against its UK subsidiary. On September 30, 2004, Merck had announceda worldwide voluntary recall of the drug, after reports of side effects including blood clots,heart attacks, and strokes. The recall was prompted by clinical findings concluding that Vioxxusers were twice as likely to suffer a stroke or heart attack as the general population. Vioxxwas the first COX-2 non-steroidal anti-inflammatory drug (NSAID) to be recalled as a resultof its significant cardiovascular dangers. As a result of the claimed defects in Vioxx, some15,000 cases had been filed by Vioxx plaintiffs in New Jersey, the vast majority of whichwere from US citizens.

Merck, a New Jersey company, issued an FNC application that was heard by AtlanticCounty Superior Court Judge, Carol E. Higbee, who applied New Jersey’s own slightlymodified version of the federal FNC doctrine.47 Judge Higbee found that the UK was asuitable alternative forum, despite the absence of likely available funding, the ‘‘loser pays’’rules, the absence of punitive damages, and causes of action such as loss of consortium andconsumer fraud.48

46Coakes v Arabian American Oil. Co, 831 F. 2d 572, 576 (5th Cir. 1987); Murray v British Broadcasting Corp, 831 F. 2d, 572(5th Cir. 1987).

47See for e.g. Mandel v Bell Atl. Nynex Mobile, 315 N.J. Super 273 (Law Div. 1997).48Consumer Fraud Laws can have a huge impact on the viability of pursuing such claims, not least because of the effect of

provisions being made for the recovery of attorney fee costs if such claims succeed. For example, it is noteworthy thaton June 15, 2007, Judge Higbee herself found Merck liable for roughly $3.7 million in fees in two US plaintiff’s cases(Cona and McDarby v Merck) that included fraud and punitive damages claims under the New Jersey Consumer FraudAct. The trial had taken place earlier in the year before a New Jersey jury. Mr McDarby won his product liability claim,with the jury awarding him a total of almost $10 million in compensatory damages based on Merck’s failure to properlywarn of Vioxx safety risks, and an additional $9 million in punitive damages (that award carried no right to attorney’sfees). Mr McDarby recovered the purchase price of the drug ($3,969) under the Consumer Fraud Act. Mr Cona losthis product liability claim on causation grounds but the jury found for him in his Consumer Fraud Act claim, awardinghim the princely sum of $45 (trebled to $135). The recoveries on the Consumer Fraud Claims were $45 and $3,968,for a total of $4,044 between the two plaintiffs. However, under the Consumer Fraud Act, the judge held that theplaintiffs were entitled to recover their attorney fees costs. Both firms submitted bills amounting to some $4.6 million.



The Superior Court of New Jersey Appellate Division upheld the trial judge’s decision onJuly 31, 2007. Despite cogent evidence from Mr. Martyn Day of Leigh Day that his firm(and Irwin Mitchell and Goodmans) had abandoned the idea of bringing claims in Englandand Wales because they believed there was no realistic route to having them funded,49 theNew Jersey judges disagreed: after all there were CFAs, and after the event insurance,50 and:

‘‘Additionally, there is now some discretion as to the imposition of the ‘winner’s’costs upon the loser. Part 44 of the English Civil Procedure Rules of 1998 (CPR)has, to an extent modified the English ‘loser pays’ system. CPR r.1.1 sets out criteriato be utilized by the court in assessing costs, and mandates that the financial positionsof the parties are a relevant consideration. Thus, success on the merits no longerguarantees full cost reimbursement. Moreover, we observe that counsel’s concernthat the litigation not bankrupt the plaintiffs, while laudable, suggests an apparentlack of confidence in the ultimate merits of at least some of their claims.’’

That passage demonstrates there is far more to comparative law than reading passagesin a foreign law book, even with the assistance of expert counsel. It also highlights theunfamiliarity of US judges with the cost risks involved in the English system.

A similar approach can be seen in Gullone, where the trial judge also dismissed all theplaintiffs concerns about funding and English cost rules of ‘‘loser pays’’, which they hadcontended would be likely to dissuade actions being brought in England. CFA’s were theanswer, despite evidence that they were unlikely to be available to the plaintiffs in a complexcase such as this. CFAs were, to Judge Grady, a device which allows:

‘‘. . .an attorney, in a case he or she deems worthy of the risk, to undertake the casein the hope of prevailing and collecting fees from the other side. That is essentiallywhat plaintiffs’ counsel in Gullone had done. While a successful outcome [i.e. inthe U.S.] might yield greater fees pursuant to their percentage fee agreements thanwould result from the fee-shifting provided for under a CFA, a fee based on doublethe amount of the lodestar51 should still prove attractive to British barristers. Thiswould be especially so when they view the prospects of recovery in the changedlandscape of the Fairchild decision. Furthermore, while an attorney can never counton settlement, the likelihood of settlement in cases of this kind—as witness thesettlement of our own first generation cases and the settlement of the British HIVblood cases- can never be ignored. Another consideration for a British barristerwould be that much of the discovery pertaining to the liability issues has alreadybeen done in two generations of this MDL and would be available for use in theU.K.’’

Judge Grady concluded, ‘‘plaintiffs would be unlikely to have any difficulty obtainingcompetent counsel to represent them in a U.K. action’’.52

Judge Higbee thought that attorney’s fees were mandatory and awarded the plaintiff’s lawyers some 80% of their claimedattorneys fees and costs. Mr Cona who had lost his liability case and only won some $135 under the Consumer FraudAct was awarded attorney’s fees of approximately $2 million. . As the judge said, determining ‘‘reasonable counsel fees’’was not easy, but ‘‘Merck could have settled the CFA claims at any time to avoid the potential counsel fee issue butchose not to do this’’ (Slip. op. at 13).

49The Legal Service Commission had withdrawn funding.50Whilst accepting that apparently only £1 million of the necessary £5 million cover had been obtained.51i.e. the ordinary costs.52Westlaw transcript, p.8–9.



With respect, this view of the possibility of the Gullone claimants obtaining representationin England and Wales was probably hopelessly optimistic. As was noted by Davies ArnoldCooper in their January 2006 edition of the firm’s Wire—Product Liability and Injury newsletter:

‘‘If the Gullone Claimants do try to commence proceedings in the UK, theirprospects of obtaining funding for the claim are unlikely to be as good as theUS Court suggests. In the recent Vioxx litigation, the Legal Services Commissionrefused to give the Claimant’s public funding and they have also been denied the‘after the event’ insurance they would need to pursue the claim with a conditionalfee agreement. Even if funding is received, the Gullone Claimants will undoubtedlyface a lengthy struggle before their claims are resolved . . .’’

As for the ‘‘loser pays’’ cost rules, Judge Grady also came to a somewhat rosy view of theEnglish cost rules, and concluded:

‘‘. . .Considering the unfortunate circumstances of the plaintiffs in this case, wehave difficulty imagining any court exercising its discretion to order these plaintiffsto pay the attorneys’ fees of the defendants. Therefore, we do not regard the ‘‘loserpays’’ rules as a factor that compromises the adequacy of the UK forum.’’

Once again, the Seventh Circuit Court of Appeals agreed with the trial judge, without anysignificant comment on the judge’s conclusions, merely noting:

‘‘Plaintiffs argue that there are ‘extreme impediments’ to their funding of thelitigation, if it were to proceed in the United Kingdom, largely because the Englishlegal system uses a ‘loser pays’ rule for attorney fees and because compensatorydamages tend to be low. We do not see how the use of a different fee-shiftingrule for attorney’s fees can weigh against dismissal, however, in the light of PiperAircraft. Obviously the English Rule is less favourable to plaintiffs whose chances oflosing are too great (which, for risk-averse plaintiffs, might even be 30% or 40%),but we believe that must be regarded as the kind of unfavourable difference in legalsystem that carries little weight. In fact, the United States stands almost alone inits approach towards attorney’s fees, and so if we were to find that dismissal waswrong for this reason, we would risk gutting the doctrine of forum non conveniensentirely.’’

The last sentence shows that ultimately this is a policy decision. These recent cases highlightthat frankly the US Courts do not care if there is little likelihood that the litigation may everbe pursued abroad. They have known this was the likely to be the position for many years.Professor David Robertson of the University of Texas attempted to discover the history ofeach reported trans-national case dismissed under the FNC doctrine from 1947 until the endof 1984. He collected data on 55 personal injury cases and 30 commercial cases. Of the 55personal injury cases only one was ever tried in a foreign court. Of the 30 commercial cases,only two reached trial.53

Therefore, on the authorities as they stand it is hard to envisage a situation where Englandand Wales, (or as the US Courts tend to prefer, the UK) will not be considered an adequate

53David W. Robertson, Forum Non Conveniens in America and England: A Rather Fantastic Fiction, (1987),103 LQR 398.See this discussion of this article by the Texas Supreme Court in Dow Chemical Company v Castro Alfaro, 786 S.W. 2d674 (Tex. 1990), as part of their short-lived revolt against the FNC doctrine.



alternative forum in such drug cases. (Indeed, the UK is regularly declared to be such aforum in all sorts of cases. For instance, in 1999, it was one of at least 13 foreign courts thatwere found to be adequate alternatives to the US. The others were Canada, Cayman Islands,Columbia, France, Germany, Greece, Hong Kong, Liechtenstein, Netherlands, Pakistan,Peru and Switzerland).54 If a plaintiff were to attempt to argue otherwise on the groundsof funding in particular, wholesale detailed evidence of the absence of funding and theunlikelihood of CFA arrangements being in place in all the cases subsequent to these FNCdismissals would need to be put before (a hopefully) more sympathetic US court. However,the prospects appear bleak.

Stage two: the discretionary balancing of private and public

interests

If an adequate alternative forum is found to exist (as it normally will in relation to the UK inproduct liability actions), then the second stage is for the US Court to decide whether or notto exercise its discretion to dismiss. This is done by balancing so-called private and publicinterest factors against the convenience and indeed reasonableness of the plaintiff’s choice offorum.

These public and private interest factors emerged from two 1947 Supreme Court casesGulf Oil Corp v Gilbert55 and Koster v American Lumbermens Mutual Casualty Co56 decidedon the same day. Indeed, it can properly be argued that those decisions effectively createdthe FNC doctrine both for federal courts and for state courts (where precious few examplesprior to 1947 existed).57 To give the doctrine some heritage, its origins are often attributedto Scotland58 and its application purportedly derived by rough analogy from the power ofadmiralty courts to abstain from hearing actions of a ‘‘case entirely between foreigners’’.59

Both Gulf Oil and Koster were however, purely domestic cases of the kind readily expectedto arise in a federal state such as the US and were in fact, simple cases which were not thegreatest of models for providing guidelines for trans-national cases.

Gulf Oil

In Gulf Oil, a Virginia plaintiff sued a Pennsylvania company in a New York federal court,claiming that a fire that had damaged the plaintiff’s warehouse in Virginia had been caused bythe defendant’s negligence. The defendant did business in New York (as well as in their home

54See McNamara, International Forum Selection and Forum Non Conveniens, (2000), 34 Int’l Law. 557, 560–61.55Gulf Oil [1947] 330 US 501 (see Piper, at p.248).56Koster [1947] 330 US 518.57For e.g. Barrett, The Doctrine of Forum Non Conveniens, 35 Cal. L. Rev. 380; Stein, Forum Non Conveniens and the

Redundancy of Court-Access Doctrine, (1985) 133 U. Pa. L. Rev. 781. Those that did showed the US courts ‘‘struggledto apply’’ the doctrine: see Short, Is the Alien Tort Statute Sacrosanct? Retaining Forum Non Conveniens in Human RightsLitigation, (2001) 33. N.Y.U.J. Int’L L. & Pol, 1001, 1019 and fn. 83.

58For e.g. in Piper Aircraft Co. v Reyno [1981] 454 US 235, 248, fn.13; Braucher, The Inconvenient Federal Forum, (1947) 60Harv. L. Rev. 908.

59Madson v Ship Bureau, 6 US (2 Cranch) 240, 263 (1806); Willendson v Forsoket, 28. F. Cas. 1283, 1284 (D. Pa. 1801);The Maggie Hammond, 76 US 435 (1869); The Begenland, 114 US 355 (1885); Canada Malting Co v Paterson SS Ltd, 285US 413 (1932); Bickel, Forum Non Conveniens in Admiralty, 35 Cornell L. Q. 12 (1949); Bies, Conditioning Forum NonConveniens, 67 U.Chi. L. Rev 489 (2000).



state) and was therefore subject to jurisdiction in New York.60 All the conduct complained ofand the alleged resulting damage occurred in Virginia. The district court dismissed the case onFNC grounds, directing that it would be better tried in Virginia. The Second Circuit Courtof Appeal allowed the plaintiff’s appeal, but the case went to the Supreme Court who upheldthe trial court’s decision, confirming the existence of the principle of FNC doctrine, whichgave courts a discretionary power to decline jurisdiction even in cases where jurisdiction overthe defendant had been properly asserted.

In Gulf Oil, the Supreme Court declared that this discretion to decline jurisdiction aroseonly in ‘‘exceptional circumstances’’:

‘‘This Court, in one form of words or another, has repeatedly observed the existenceof the power to decline jurisdiction in exceptional circumstances. . . The principleof forum non conveniens is simply that a court may resist imposition upon itsjurisdiction even when jurisdiction is authorized by the letter of a general venuestatute.

. . .

Wisely, it has not been attempted to catalogue the circumstances which will justifyor require either grant or denial of remedy. The doctrine leaves much to thediscretion of the court to which plaintiff resorts, and experience has not shown ajudicial tendency to renounce one’s own jurisdiction so strong as to result in manyabuses.’’61

Gulf Oil’s private and public interest factors

The Court gave some guidance for determining when this FNC discretion should be used,setting out the relevant factors to be considered:

‘‘If the combination and weight of factors requisite to given results are difficult toforecast or state, those to be considered are not difficult to name.’’

These were listed in two categories, those of ‘‘private’’ and so called ‘‘public’’ interest. Theprivate interest factors were described as follows:

‘‘An interest to be considered, and the one most likely to be pressed, is the privateinterest of the litigant. Important considerations are the relative ease of access tosources of proof; availability of compulsory process for attendance of unwilling, andthe cost of obtaining attendance of willing, witnesses; possibility of view of premises,if view would be appropriate to the action; and all other practical problems thatmake trial of a case easy, expeditious and inexpensive. There may also be questionsas to the enforceability of a judgment if one is obtained. The court will weighrelative advantages and obstacles to a fair trial. It is often said that the plaintiff maynot, by choice of an inconvenient forum, ‘vex’, ‘harass’, or ‘oppress’ the defendantby inflicting upon him expense or trouble not necessary to his own right to pursue

60Both New York’s state courts and the federal district court based there. In Gulf Oil that was the Southern District ofNew York.

61Gulf Oil, 330 US 501, 506–508 (citation omitted).



his remedy. . . unless the balance is strongly in favor of the defendant, the plaintiff’schoice of forum should be rarely disturbed.’’62

The public interest factors63 were explained in the following terms:

‘‘Factors of public interest also have place in applying the doctrine. Administrativedifficulties follow for courts when litigation is piled up in congested centers insteadof being handled at its origin. Jury duty is a burden that ought not to be imposedupon the people of a community which has no relation to the litigation. In caseswhich touch the affairs of many persons, there is reason for holding the trial in theirview and reach rather than in remote parts of the country where they can learn ofit by report only. There is a local interest in having localized controversies decidedat home. There is an appropriateness, too, in having the trial of a diversity case ina forum that is at home with the state law that must govern the case, rather thanhaving a court in some other forum untangle problems in conflicts of laws, and inlaw foreign to itself.’’64

On the facts, the Gulf Oil case was easy to decide applying the Supreme Court’s criteria.All the conduct, damage and evidence were in Virginia, and Virginia law would govern theaction. The Virginia plaintiff advanced no cogent reasons for seeking to sue in the SouthernDistrict of New York. Only one justice (Justice Black) dissented against the principle ofFNC.

Koster

Koster was a shareholder’s derivative action by an insurance policyholder brought againstthree defendants from Illinois, again in federal court in New York. Again, there was littleconnection with New York, and jurisdiction was declined. The Supreme Court upheld thatfirst instance decision, holding:

‘‘Where there are only two parties to a dispute, there is good reason why it shouldbe tried in the plaintiff’s home forum if that has been his choice. He should notbe deprived of the presumed advantages of his home jurisdiction except upon aclear showing of facts which either (1) establish such oppressiveness and vexationto a defendant as to be out of all proportion to plaintiff’s convenience, whichmay be shown to be slight or nonexistent, or (2) make trial in the chosen foruminappropriate because of considerations affecting the court’s own administrative andlegal problems. In any balancing of conveniences, a real showing of convenience by aplaintiff who has sued in his home forum will normally outweigh the inconveniencethe defendant may have shown.’’65

62Gulf Oil, 330 US 501, 508.63Those public interest factors are the principal difference between the application of the FNC doctrine in the US and

England and Wales. The House of Lords has decided they have no place in the English doctrine: see Lubbe v Cape (No.2)[2000] 1 W.L.R. 1545.

64Gulf Oil, 330 US 501, 508–509.65Koster [1947] 330 US 518, 524.



After these two decisions, the FNC doctrine was gradually adopted by state courts,thereafter applying the Gulf Oil principles.66

Domestic statutory reforms created federal transfer rules

The Gulf Oil and Koster decisions, however, were effectively rendered redundant in federalcourts by a statutory reform in 1948, when Congress enacted 28 U.S.C. § 1404(a).67 Thiscreated a statutory code for transfers internally between federal district courts. However,this section was not a ‘‘mere codification of the forum non conveniens’’,68 and this sectiondoes not provide any statutory basis for transferring cases outside of the federal court system,whether to a state court,69 or in an international context.70 It is however, an importantsection for any foreigner who sues in the US in a state court. For a defendant can apply tohave a state court action ‘‘removed’’ to a federal district court,71 and if that happens, thecase can then be transferred to another district court as was the case in Piper Aircraft v Reyno,discussed below.

Application of Gulf Oil to international cases

However, the principles established in Gulf Oil and Koster were maintained and developedfor international cases, despite being described by some commentators as being inappropriatefor such developments because of the almost complete absence of guidance in those decisionsfor international cases.72 Indeed, it was noted by the Supreme Court in 1950 in Swift & CoPackers v Compania Colombiana del Caribe73 that the:

‘‘[a]pplication of forum non conveniens principles to a suit by a United States citizenagainst a foreign respondent brings into force considerations very different fromthose in suits between foreigners.’’

However, it took until 1981 before the Supreme Court took the opportunity to begin toexplain what some of these considerations might be.

66For e.g. in California the decision of Price v Atchison, T. & S.F.Ry. Co. 1954) 42 Cal.2d 577, 580.67§1404(a) states: ‘‘For the convenience of parties and witnesses, in the interests of justice a district court may transfer any

civil action to any other district or division where it might have been brought.’’68Norwood v Kirkpatrick [1955] 349 US 29.69Simon v Silfen, 247 F. Supp. 762, 763 (S.D.N.Y. 1965).70See for e.g. Born, Rutledge, International Civil Litigation in United States Courts 4th edn, p.353.71Under 29 USC. § 1441, which states in material part: Actions removable generally ‘‘(a) Except as otherwise expressly

provided by Act of Congress, any civil action brought in a State court of which the district courts of the United Stateshave original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United Statesfor the district and division embracing the place where such action is pending. For purposes of removal under thischapter, the citizenship of the defendants sued under fictitious names shall be regarded’’.

72See for e.g. David W. Robertson, Forum Non Conveniens in America and England: A Rather Fantastic Fiction, (1987) 103L.Q.R. 398.

73Swift & Co [1950] 339 US 684 (an admiralty jurisdiction case involving a suit brought by a US citizen).



Piper Aircraft

That opportunity arose in the decision of Piper Aircraft Co v Reyno74 which involved anaction in California arising out of the crash of a chartered aircraft in Scotland on a flightfrom Blackpool to Perth. A wrongful death action was brought on behalf of the relativesof the deceased against the US manufacturers of the engine and propellers of the plane.The claim was brought (as they admitted) because of more favourable US laws on liability,damages and indeed ability to sue. The action was taken out of the California state courtand removed to a California federal district court, who then transferred the action to anotherPennsylvania federal court under the powers granted by 28 USC §1404(a) discussed earlier.The defendants then sought dismissal of the action on the basis of the FNC doctrine in GulfOil. They succeeded, on condition that they submitted to the jurisdiction of the Scottishcourts and waived any statute of limitation defences. On appeal, the Third Circuit Court ofAppeal allowed the plaintiff’s appeal, concluding that as Scottish law was less favourable tothe plaintiff then dismissal was wrong. On appeal to the Supreme Court, the original trialcourt decision was restored.

Piper: a foreign plaintiff’s choice of forum is entitled to ‘‘less

deference’’

The decision of the Supreme Court led to a significant modification of the Gulf Oil/KosterFNC principles. Of particular importance was the ‘‘deference’’ that was to be shown tothe plaintiff’s choice of forum. The exceptional nature of the doctrine of FNC had beenemphasised by the Court in Gulf Oil. The defendant had to establish a strong case for bothprivate and public inconvenience to justify a dismissal under the FNC doctrine, ‘‘unless thebalance is strongly in favour of the defendant, the plaintiff’s choice of forum should rarely bedisturbed’’.75 In Piper, the Supreme Court revisited the amount of deference that was to begiven to a plaintiff’s choice of forum when measuring the private and public interest factors.Both Gulf Oil and Koster had emphasised the strong deference usually accorded by the courtsto the plaintiff’s choice of forum. There is ordinarily a strong presumption in favour of theplaintiff’s choice of forum.76 However, the Supreme Court decided in Piper Aircraft thatwhere a foreign plaintiff is concerned, their choice of forum is entitled to ‘‘less deference’’.77

This distinction was expressed to be based not on a desire to disadvantage foreign plaintiffs,but was some form of rough rule of thumb for assessing the reasonableness and convenienceof the plaintiff’s choice of forum in a US Court:

‘‘[w]hen the home forum has been chosen, it is reasonable to assume that thischoice is convenient. When the plaintiff is foreign, however, this assumption ismuch less reasonable. Because the central purpose of any forum non conveniensinquiry is to ensure that the trial is convenient, a foreign plaintiff’s choice deservesless deference.’’78

74Piper Aircraft Co v Reyno [1981] 454 US 235.75Gulf Oil, [1947] 330 US 501, 508.76Piper Aircraft Co v Reyno, [1981] 454 US 235, 255.77Piper Aircraft, 454 US at 256.78Piper Aircraft, at 255–56.



Not everyone believed them. The Washington Supreme Court in Myers v Boeing Co,79

refused to adopt the Supreme Court’s analysis saying:

‘‘The Court’s logic does not withstand scrutiny. The Court is comparing applesand oranges. Foreigners, by definition can never choose the United States as theirhome forum. The Court purports to be giving lesser deference to the foreignplaintiffs’ choice of forum when, in reality, it is giving lesser deference to foreignplaintiffs, based solely on their status as foreigners. More importantly, it is notnecessarily less reasonable to assume that a plaintiff from British Columbia, whobrings suit in Washington, has chosen a less convenient forum than a plaintiff fromFlorida bringing the same suit? To take it one step further, why is it less reasonableto assume that a plaintiff who is a Japanese citizen residing in Wentachee, whobrings suit in Washington, has chosen a less convenient forum than a plaintiff fromFlorida bringing the same suit? The Court’s reference to the attractiveness of UnitedStates courts to foreigners, combined with a holding that, in application, gives lessdeference to foreign plaintiffs based on their status as foreigners, raises concernsabout xenophobia. This alone should put us on guard.’’

Some other states refused to allow the residence of the plaintiff to influence the deferenceto be given to the plaintiff’s choice, but it was only a factor to be applied in the weighing ofpublic and private interest factors.80

In 2001, in Iragorri v United Technologies,81 the Second Circuit Court of Appeals, sitting enbanc, tried to explain the basis of the difference in treatment between US and foreign plaintiffson the basis of convenience, whilst introducing the spectre of ‘‘forum shopping’’ as a basisfor reduced deference in the plaintiff’s choice of forum. The Second Circuit said:

‘‘Based on the Supreme Court’s guidance, our understanding of how courts shouldaddress the degree of deference to be given to a plaintiff’s choice of a U.S. forum isessentially as follows: The more it appears that a domestic or foreign plaintiff’s choiceof forum has been dictated by reasons that the law recognises as valid, the greater thedeference that will be given to the plaintiff’s forum choice. Stated differently, thegreater the plaintiff’s or the lawsuit’s bona fide connection to the United States andto the forum of choice and the more it appears that considerations of conveniencefavour the conduct of the lawsuit in the United States, the more difficult it will befor the defendant to gain dismissal for forum non conveniens. Thus factors that argueagainst forum non conveniens include the convenience of the plaintiff’s residence inrelation to the chosen forum, the availability of witnesses or evidence to the forumdistrict, the defendant’s amenability to suit in the forum district, the availability ofappropriate legal assistance and other reasons relating to convenience of expense. Onthe other hand, the more it appears that the plaintiff’s choice of a U.S. forum wasmotivated by forum-shopping reasons- such as attempts to win a tactical advantageresulting from local laws that favour the plaintiff’s case, the habitual generosity ofjuries in the United States or in the forum district, the plaintiff’s popularity or thedefendant’s unpopularity in the region, or the inconvenience or expense to thedefendant resulting from litigation in that forum—the less deference to the plaintiff’s

79794 P. 2d 1272, 1281 (Wash. 1990).80For e.g. Warburg, Pincus Ventures, LP v. Schrapper, 774 A.2d, 264 (Del. 2001).81Iragorri, 274 F.3d. 65 (2d. Cir. 2001).



choice commands and, consequently, the easier it becomes for the defendant tosucceed on a forum non conveniens motion by showing that convenience wouldbe better served by litigating in another country’s courts.’’82

Iragorri was subsequently interpreted within the Second Circuit as meaning simply that thenationality of the plaintiff was simply a factor to be weighed in the FNC analysis as part of thelegitimate reasons for suing in the US forum. The fact that a plaintiff was a foreigner did notmean that their choice of forum was entitled to receive no weight. In Bigio v Coca-Cola,83 theSecond Circuit reversed a trial court’s decision to dismiss on the grounds of FNC preciselybecause he had given the plaintiffs choice of forum no weight at all. The Second Circuit said:

‘‘[T]he more that a plaintiff, even a foreign plaintiff, chooses to sue in a UnitedStates court for ‘‘legitimate reasons’’, the more deference must be given to thatchoice. . .Furthermore, even where the degree of deference is reduced, ‘‘[t]heaction should be dismissed only if the chosen forum is shown to be genuinelyinconvenient and the selected forum significantly preferable.’’84

Sinochem International

The Supreme Court revisited the doctrine of FNC in 2007 in Sinochem International Co vMalaysia International Shipping Corp.85 In Sinochem, the Court restated the Piper criteria. If aplaintiff is suing far from home, it is less reasonable to assume that the forum chosen is aconvenient one. Giving the unanimous opinion of the whole court, Justice Ginsburg wrote:

‘‘A defendant invoking forum non conveniens ordinarily bears a heavy burdenin opposing the plaintiff’s chosen forum. When the plaintiff’s choice is not itshome forum, however, the presumption in the plaintiff’s favour ‘applies with lessforce’, for the assumption that the chosen forum is appropriate is in such cases ‘lessreasonable’.’’86

As a result of Sinochem, it has been said, correctly in my opinion, that:

‘‘This language supports the position that the relevant dicta in Piper simply meansthat when there is a local plaintiff there is a greater likelihood of a connection withthe forum than when there is a foreign plaintiff. While the presumption in favourof the plaintiff’s choice of forum has ‘less force’ when the plaintiff is foreign, itnonetheless applies.’’87

The private/public interest factors summarised

Therefore, subject to the Piper modifications, including the ‘‘less deference’’ to a foreignplaintiff’s choice of forum, Gulf Oil continues to be recognised by the Supreme Court as the

82Iragorri, 274 F.3d. 65, 71–72 (2d. Cir. 2001).83Biggio v Coca-Cola, 448 F.3d. 176 (2d Cir. 2006).84Biggio v Coca-Cola, 448 F.3d. 176, 179 (2d Cir. 2006).85Sinochem[2007] 127 S.Ct. 1184, 167 L.Ed. 2d 15 .86Sinochem, quoting Piper.87Brand and Jablonski, Forum Non Conveniens, History, Global Practice and Future under the Hague Convention on Choice of

Court Agreements (2007), p.61–62.



leading case delineating the FNC doctrine.88 Those are the Gulf Oil categorisations set outearlier can be summarised as follows:

(a) The private interests —those involving the litigants included:

(i) The relative ease of access to sources of proof.(ii) Availability of process to summon the unwilling witnesses, and the cost of obtaining

attendance of the willing witness.(iii) The possibility of a view if that is a factor.(iv) Enforceability of a judgment if one is obtained.(v) ‘‘[A]ll other practical problems that make trial of a case easy, expeditious and

inexpensive’’.

(b) The Public interest factors included:

(i) Court congestion.(ii) The burden of jury service imposed on members of a community having no

relation to the litigation.(iii) Holding trial in the view of persons concerned, rather than at a remote location.(iv) The problems of the forum court untangling law of another jurisdiction.89

What a US federal court actually does is weigh both the relative private litigationconvenience of the parties and the relative public interests of the forum state and its court’ssystem against the presumption in favour of the plaintiff’s forum selection which itself dependson a sliding scale of ‘‘deference’’ depending ultimately on nationality and residence.90

Private interest factors

Obviously, how these factors are weighed depend on the precise facts of the case. Readingany of these cases shows the usual claims (real or imagined) to the witnesses that might becalled, and alleged difficulties in obtaining such witnesses and other evidence if one party’schosen forum is not selected. That is the ordinary common or garden dispute of FNC caseswhether in the US or in England and Wales. For example, in the Gullone case, of the privateinterest factors, the one that most support the defendants’ case was a claim that they might beunable to join third-party British defendants to the US action. On the evidence, it appearedthat all of the Gullone plaintiffs used factor concentrates from sources other than, or at least, inaddition to those manufactured by the US defendants. The defence argued that they mighthave to join those third parties and/or the UK distributors and physicians who prescribedthem to the plaintiffs. At least they claimed they might have difficulties obtaining disclosureagainst them. The plaintiffs suggested that this was all a ruse in which the defence had noreal belief. Judge Grady refused to discount the defence considerations entirely without thebenefit of further investigation, and agreed with the defence that:

88See for e.g. Quackenbush v Allstate Ins. Co, 517 US 706, 723; American Dredging Co v Miller, 510 US. 443, 447–49.89Gulf Oil, 330 US at pp.508–509.90Pain v United Technologies Corp., 637 F.2d 775, 784 (D.C. Cir. 1980), cert. denied, 454 US 1128 (1981).



‘‘. . .their ability to join potential third-party defendants is a factor that weighs infavour of the U.K. as the more convenient forum.’’91

However, Judge Grady rejected arguments based on unavailability of compulsory process forthe attendance of unwilling witnesses.

The real hurdle:the public interest court convenience factors, in

particular ‘‘court congestion’’

However, what the recent cases demonstrate is, that whatever the balance that was reachedon the private interest factors, it is increasingly the ‘‘public interest’’ factors which cause aforeign plaintiff impossibly difficult hurdles to overcome, particularly when weighed againstthe differing approach to the sliding scale of deference to a foreign plaintiff’s choice.

This was manifestly demonstrated in the Vioxx litigation. The defendant, Merck (motto:‘‘where patients come first’’) is a global company. Its headquarters is located in WhitehouseStation, New Jersey. Merck designed, tested and manufactured Vioxx in New Jersey. For thepurpose of their FNC motion in the action brought by the Britons, Merck also stipulated thatthe marketing and worldwide distribution of the drug was undertaken from New Jersey.92

Obviously, the drugs had been licensed in the UK and prescribed and ingested by the plaintiffsthere. However, in a product liability action of this nature, an independent observer can beforgiven for concluding that the essential evidential core of this claim lay in New Jersey.

As a result of the claimed defects in Vioxx, some 15,000 cases had been filed by Vioxxplaintiffs in New Jersey, the vast majority of which were from US citizens. The New Jerseycourts had already decided that the state maintains an interest in regulating the conductof corporations domiciled there.93 No doubt Merck and their insurers were committingconsiderable resources to the defence of those claims. The 98 Britons represented a possibleincrease of no more than 0.65 per cent in these cases.

Traditionally, as in the application of the FNC doctrine in England and Wales, defendantswho are sued in their ‘‘home court’’ can hardly expect to complain of inconvenience. AsBorn and Rutledge put it:

‘‘defendants who argue that it would be inconvenient for them to litigate in acourt located only blocks away from their headquarters often encounter scepticalreactions: ‘‘It is, as Alice said, ‘curiouser and curiouser’.’’ (Lony v E.I. Dup Pont deNemours & Co, 935 F.2d 605, 608 (3rd Cir. 1991) (noting that ‘‘Du Pont, whichis headquartered in Wilmington, Delaware, and is the largest employer in that stateseeks to move the action against it to a forum more than 3,000 miles away’’.)94

However, jurisdiction was declined by the trial judge who applied New Jersey’s own versionof the federal FNC doctrine.95 The New Jersey version has one particularly unfortunate addedtwist as regards the criteria that the public and private interests were to be measured. For

91Gullone,Westlaw transcript p.10.92A stipulation that the trial judge did not adopt for reasons best known to herself.93Gantes v Kason Corp [1996] 145 N.J. 478, 489.94Born & Rutledge (cited above) p.386.95See for e.g. Mandel v Bell Atl. Nynex Mobile, 315 N.J. Super 273 (Law Div. 1997).



while Piper Aircraft had declared that ‘‘a foreign plaintiff’s choice deserves less deference’’,96

the New Jersey courts in the Mandell decision had taken that a stage further: ‘‘. . . [A]non resident’s choice of forum is entitled to substantially less deference’’.97 This substantialdeterioration in the position of a non-resident was apparently justified on policy grounds.For the Mandell decision said that:

‘‘The purpose of the public interest factors is to look beyond the interests of specificparties to any dispute and to determine on a broader societal level whether the actionshould be maintained here. In this regard, it is simply not enough that the plaintiffchooses this forum, it is essential that, looking at the public interest considerations,there be a connection with the forum, a reason why it should in fairness to thecitizens of this state be permitted to remain here.’’98

This was applied by Judge Higbee who found that the UK was a suitable alternative forum,despite the absence of likely available funding, the ‘‘loser pays’’ rules, the absence of punitivedamages and causes of action such as loss of consortium and consumer fraud. The trial judgethen applied the discretionary private factors and found them essentially balanced, but camedown in favour of the defendant because of the public interest factors, finding that ‘‘the UKCourt’’ had a significant interest in addressing the injuries of its citizens and adjudicatingmatters regarding products regulated and marketed within its borders:

‘‘Allowing a New Jersey jury to determine the appropriateness of standards set forthby the U.K. regulatory body will only risk imposing an American view upon thejudgment of a foreign country. . .’’

But as is most readily apparent, the key public interest factor for the trial judge was ‘‘theburden on the New Jersey court system’’—the ‘‘court congestion’’ argument:

‘‘While handling an enormous volume of cases is difficult, it is manageable where allparties are residents of the same country. It is much less costly and easier to handlethe litigation where only different states are involved. In fact, there have been nosubstantial difficulties in the coordinated litigation in New Jersey up to now basedon the fact plaintiffs are from different states. That would not be true if the NewJersey Court had to address issues raised because plaintiffs are from the U.K. andfrom numerous other foreign countries, each of which would present a substantialburden on the court and exacerbate the administrative process the court is alreadyoverseeing. This court notes the Federal Judge who is also overseeing litigationthat originated in federal courts in many different states also found it would be toomuch of a burden to allow actions filed by French and Italian residents to proceedin the U.S. rather than their own country. The burden on the State of New JerseyCourts is an unnecessary one since a foreign country’s courts can do a better job ofinterpreting their own laws and protecting their citizens.’’

The Superior Court of New Jersey Appellate Division upheld this dismissal on these publicinterest factor grounds. First, the fact that Vioxx had been subject to regulatory approval inthe UK. Without deciding the issue, the court assumed that ‘‘UK law’’ would apply to issues

96Piper, at 255–5697Mandel v Bell Atl. Nynex Mobile, 315 N.J. Super 273, 281–82.98Mandel v Bell Atl. Nynex Mobile, 315 N.J. Super 273, 447.



relating to product approval and labelling. The court then concluded that while a New Jerseyjury would be capable of applying foreign law, ‘‘we question why it should be called uponto do so in these cases’’. Secondly, and most importantly:

‘‘New Jersey’s interest in having the controversy decided here is lessened by theresidence of the plaintiffs abroad and their ingestion, in the U.K., of a prescriptiondrug subject to foreign regulation.’’

The Court simply deferred to Judge Higbee’s conclusion on that subject as set out above.Subsequently, the New Jersey Supreme Court has declined to hear an appeal.99

As Born & Rutledge have pointed out:

‘‘. . . complaints of docket congestion quickly become self-fulfilling prophe-cies—once one judge states that a court’s docket is overcrowded, subsequentjudges can seize upon that language in future cases to support dismissal.’’100

A number of cases have followed a route of declaring their particular court the ‘‘one of themost congested Federal Court dockets in the nation’’101 or ‘‘one of the busiest districts in thecountry’’.102

In the Gullone case, Judge Grady went further to establish that the US courts are congested,quoting statistics for the respective courts:

‘‘The Northern District of California is a congested court, with a high weightedcivil caseload of 519 cases per judgeship. By comparison, the weighted civil caseloadfor the Northern District of Illinois is 451 cases per judgeship, for the EasternDistrict of Pennsylvania, 449 cases per judgeship, and, for the Southern District ofNew York, 448 cases per judgeship. If the Northern District of California were toconduct whatever number of jury trial may be necessary to resolve the claims of theeight U.K. plaintiffs in Gullone, it would contribute significantly to the congestionproblem the court already has.’’

In contrast, Judge Grady attempted to conduct a likely comparison with the UK oncongestion and concluded that the UK would be preferable, primarily because it would be ajudge-only trial:

‘‘An experienced English judge would be able to try the claims of more Gulloneplaintiffs in a single trial than a lay American jury would be able to comprehend anddecide in a single trial.’’

However, the Seventh Circuit Court of Appeal interestingly did not uphold that view,concluding that the factor was ‘‘neutral’’.103

99Subsequent to these dismissals, Merck announced on November 9, 2007, the creation of a $4.85 billion settlement fundfor qualifying US claims. The settlement is only open to ‘‘U.S. legal residents and those who allege their MI or ischemicstroke occurred in the United States’’.

100Born & Rutledge, p.397.101Rivas ex. rel. Estate of Gutierrez v Ford Motor Co, 2004 W.L. 1247018 (M.D. Flat. 2004).102Gambra v International Lease Finance Corp. 377 F. Supp. 2d 810 (C.D. Cal. 2005).103Gullone, 484 F. 3d. 951 (7th Cir. 2007).



Baycol/Lipobay

It is a rare US judge who will speak out against the existence of congestion. In the Lake(Baycol/Lipobay) the UK plaintiffs thought that they had found one. Judge Monro in theSuperior Court of Connecticut (in a judgment of July 26, 2006) appeared to be one, saying:

‘‘Presently, it cannot be argued that this case will unduly burden the Connecticutcourts. The civil docket in Connecticut is in remarkably good shape and this case isonly a single plaintiff (and spouse) case of a pharmaceutical products liability claimwhich is housed in the Complex Litigation Docket which was established to addressthe needs of litigants such as these without interfering with the orderly flow of othercourt business.’’

Judge Monro dismissed the FNC application. Normally such a dismissal would have littlechance of being overturned on appeal, as only an ‘‘abuse of discretion’’ basis. The learnedjudge then however, granted a motion to ‘‘reargue’’ the case, which he had heard. This wasdone on the basis that the judge’s analysis of the private and public interest factors was:

‘‘[. . ..] insensitive to the right of the U.K. to determine the legal remedies availableto its citizens under its tort and product liability system [. . .]’’

This was based on alleged incorrect factual inferences drawn from conflicting affidavits ofthe English Q.C.104 instructed by the defence. More importantly, one cannot help feel, theydrew Judge Munro’s attention to decisions of Vioxx class action suit and the New Jerseydecision highlighted above in which UK plaintiffs had been dismissed.

Remarkably (and that is the politest thing I can say on reading the judgments) JudgeMunro reversed himself and dismissed the claim on the basis of FNC.

The reality is that the ‘‘court congestion’’ advocates are winning in the US.

The state ‘‘interest’’ issue

Linked to this, is a common theme in all these judgments of the purported respect for theUK ‘‘interest’’ in the proposed litigation, which English lawyers might find rather odd.

In Gullone for example, the dispute was whether or not the UK or the Northern Districtof California had the greater interest in the controversy. Judge Grady thought that:

‘‘. . . the interest of the U.K. in the adjudication of this controversy far outweighsthe interest of California residents. This is a factor that points strongly to the U.K.as the more convenient forum.’’

The Seventh Circuit did not ultimately express agreement with the judge on this,concluding that:

‘‘a rational person might come to either conclusion on this record: some mightthink that the greater interest lies in the place where the companies operated andallegedly committed the wrongs; other might find a greater interest in the place

104The Q.C. appeared to Judge Munro to say one thing in the Vioxx litigation and another in the Baycol/ Lipobay litigation.



where the victims suffer from those wrongs and where the financial impact of theconsequences will fall. Put another way, the record contains enough evidence tosupport the conclusion that the citizens of the United Kingdom have a greaterinterest in this controversy than those of the Northern District of California. In lightof the fact that the plaintiffs have not sued in their home forum, and therefore thatthe presumption of convenience in their favour ‘‘applies with less force,’’ Sinochem,127 S.Ct at 1991, we see no reversible error on the district court’s conclusion thatthe defendants met their burden here.’’

Why it appears odd to English eyes is that we normally do not decide conflicts of lawsissues by reference to competing state interests. ‘‘Interest analysis’’ is a purely US creation,introduced as a method of analysing choice of law problems, developed by the late ProfessorBrainerd Currie which heavily influenced the Restatement (Second) on Conflicts of Law(1971). Currie argued in a choice of law decision making, the governmental interests of eachjurisdiction in having its law applied. This approach has not found favour in the UK andwas expressly rejected as a basis for constructing our existing choice of law in tort when thereforms which led to the Private International Law (Miscellaneous Provisions) Act 1995 werebeing considered by the Law Commissions of England and Scotland. Unfortunately, ‘‘interestanalysis’’ has crept into US FNC decisions as well as part of the public interest factors and hasto be met with evidence by anyone seeking to bring an action in the US.

How are such interests to be defined or balanced? Some US courts have decided that thereis an interest in controlling the activities of corporations producing products within theirborders for sale abroad. For example, in another case against Merck arising out of an earlierproduct, (Carlenstolpe v Merck105) a federal judge observed that:

‘‘An American forum has a significant or equal interest to that of a foreign forumin litigation involving foreign plaintiffs and defendant American pharmaceuticalcorporations. . .where an allegedly defective drug has been developed, tested andmanufactured in the United States, and is being distributed to, and presumably usedby American citizens.’’

However, as is clear from the Vioxx decisions, there is a public policy approach toeffectively say that the New Jersey forum’s interest in the matter was sated by the amountof domestic claims that were being brought, which when mixed with the court congestionarguments made it unreasonable to ask a New Jersey jury to try the action.

Conclusions

I cannot help but quote Justice Doggett of the Texas Supreme Court in Dow ChemicalCompany v Castro Alfaro106 who in 1990 wrote in his concurring opinion in reponse tothe dissenters, who wanted to dismiss an action brought by Costa Rican fruit workerresidents who had suffered severe injuries, including sterility after being exposed to a pesticidemanufactured by Dow Chemical and Shell applying the FNC doctrine. Justice Doggettwrote:

105Carlenstope v Merck, 638 F. Supp. 901, 909 (S.D. N. Y. 1986).106Dow Chemical, 786 S.W. 2d 674 (Tex. 1990).



‘‘In their zeal to implement their own preferred social policy that Texas corporationsnot be held responsible at home for harm caused abroad, these dissenters refuse tobe restrained by either express statutory language or the compelling precedent. . .holding that forum non conveniens does not apply in Texas. To accomplish thedesired social engineering, they must invoke yet another legal fiction with a fancyname to shield alleged wrongdoers, the so-called doctrine of forum non conveniens.

The dissenters are insistent that a jury of Texans be denied the opportunity toevaluate the conduct of a Texas corporation concerning decisions it made in Texasbecause the only ones allegedly hurt are foreigners. Fortunately Texans are not soprovincial and narrow-minded as these dissenters presume. Our citizenry recognisesthat a wrong does not fade away because its immediate consequences are first feltfar away rather than close to home. Never have we been required to forfeit ourmembership of the human race in order to maintain our proud heritage as citizensof Texas.

The dissenters argue that it is inconvenient and unfair for farmworkers allegedlysuffering permanent physical and mental injuries, including irreversible sterility, toseek redress by suing a multinational corporation in a court three blocks awayfrom its world headquarters and another corporation, which operates in Texasthis country’s largest chemical plant. Because the ‘‘doctrine’’ they advocate hasnothing to do with fairness and convenience and everything to do with immunizingmultinational corporations from accountability for their alleged torts causing injuryabroad, I write separately. . .’’

The reality is that the admirable Justice Doggetts of the US are losing the battle, at leastwhen it comes to foreign litigant participating in mass actions that are being brought againstUS drug corporations. Prospects of success in the future must be remote for a UK residentseeking to defeat an FNC action in the US, when the basis of the claim is drugs administeredand indeed regulated in the UK particularly if there is already mass litigation being conductedin the US.107

These recent cases suggest very strongly that in such claims the US court room door isnot only shut, it may as well be bricked up. Yet again, King George III would have beendisappointed by news from the Americas.

107Things might be different in cases where there are relatively small numbers of claim. Then the ‘‘congestion’’/competingstate interest arguments may not be as conclusive as they appear to have been in mass claims.


Lawyer or Counsellor?

SARAH MORGAN1 AND DR DAVID ENOCH2,3

Client relationship management; Counselling; Mental disorder; Solicitors;Personal injury

Abstract

Sarah Morgan and Dr David Enoch consider the role of the personal injury lawyer andexamine the extent to which in practice lawyers also act as counsellors to clients whoare often traumatised and/or vulnerable as a result of their experiences. They considerthe extent to which lawyers are equipped (or otherwise) to perform this role and themerits of specific training for lawyers in this field. They note the benefits to clients ofthe provision of a more holistic approach, but contrast this with the risk to both clientsand the lawyers themselves of this being undertaken by lawyers lacking the necessaryskills and training. ML

Introduction

The dilemma facing solicitors dealt with in this paper, is highlighted by a telephone callfrom a client’s GP to a solicitor, during the course of which the solicitor was told:

‘‘you should think about taking a counselling course to enable you to understandwhat people in your client’s position are going through.’’

Solicitors experience specific problems associated with certain kinds of clients, andconsultant psychiatrists have noted the increasing stresses and strains placed on solicitorsbeyond their remit and responsibilities. The question remains whether these are new,increasing tensions or have they always been present in a relationship between solicitor andclient. Above all, are solicitors adequately equipped to deal with them?

Certain factors have escalated these stresses and strains, such as the emergence of a perceivedcompensation culture, compounded by some solicitors directly advertising.

Indeed, the present attitude of the public emphasises that we are all victims and someonehas to be blamed for any mishap. Such a ‘‘blame culture’’ fails to acknowledge that accidents

1Sarah Morgan is the Wales Solicitor for the National Union of Teachers Cymru and can be contacted by e-mail [email protected].

2Dr M. David Enoch, FRC Psych, DPM is Consultant Psychiatrist/Honorary Senior Lecturer in Cardiff and is a memberof the Expert Witness Institute.

3The views expressed in this article are those of the authors and should not necessarily be taken as those of any organisationthey may represent.


LAWYER OR COUNSELLOR?

can happen and that they are not always the fault of a third party. This is compounded bymodern man’s belief that there is nothing he cannot achieve.

The advent of the internet has increased people’s expectations. They have their ownconcept of perfection, be it in their role of patient or claimant. They can now scan theinternet and bring detailed facts regarding their case or their illness to the solicitor and doctor.Indeed, it is not uncommon for clients to meet with their solicitor, armed with copies of thelatest caselaw, downloaded from the internet, which they believe are directly applicable to,and supportive of their case.

A great number of these cases bring about their own inherent tensions, such as occupationalstress and post-traumatic stress disorder sufferers.

Aims

We aim:

(i) to describe the problems;(ii) to interpret the problems; and(iii) to suggest ways to manage the problems.

Describe the problems

These can vary. In compensation cases, often the claimant will state, ‘‘it’s not for themoney—it’s for the principle’’, yet in the end we know that the law cannot provide a cure,it can only compensate. In our experience no one has ever refused the money or suggested itbe given to charity.

There are times when the claimant/patient will say that they do not want to go to court.On the other hand there are others who are intent on pursuing their claims and will not besatisfied until they have had their ‘‘day in court’’, even if this means that they risk suffering apublic defeat, wrongly believing that they will get their revenge on those that they perceiveto have hurt them.

They will tell their solicitor that they do not want to be referred to a psychiatrist, althoughobviously at times the psychiatric manifestation will be the most prominent part of theirillness.

When seen by the psychiatrist, they will often challenge them regarding divulging their pasthistory, even though they have been warned by the solicitor that they will be asked detailedquestions about their past. Certainly this will apply if they attend court and are subjected tocross-examination by the defendant’s counsel. They are very reluctant to divulge their past.They will challenge the relevance of such history. They may even suggest that their ownmedical records, GP and hospital, which record their history, are inaccurate or misleading.However, it is imperative that they do cooperate and divulge all the past history, includingantisocial (even criminal) behaviour, often surprising from apparently upright citizens; anypast history of terminations, pregnancies, psychological complications and history of drugsand excess alcohol consumption.

In cases where the claimant does not accept the expert opinion of the consultantpsychiatrist, they will sometimes argue that they should be able to rely upon evidence fromtheir counsellor or psychotherapist. Such evidence will clearly not be as persuasive as that of a



consultant psychiatrist who is an independent expert witness to the court, even though theyare instructed by the solicitor, and this should be explained to the claimant in clear terms.The claimant may also request a referral to another consultant psychiatrist, if they are notaccepting of the opinion of the first.

They may not like the reports of the expert witness. Incorrect facts can certainly beamended but opinions cannot, unless new evidence is found. Any expert will reconsider theevidence but will then make up his or her own mind about it.

Again, there may well be a reluctance to receive appropriate treatment from their GP, suchas anti-depressant medication, or to be referred to a psychiatrist. If this is so, claimants mustbe told clearly that in refusing to take the advice of the appropriate expert, it may be statedthat they are not mitigating their own psychiatric injuries.

Where they have been referred to a psychotherapist or counsellor it must be noted thatwhilst psychotherapy is a powerful form of treatment, it can also have side effects, as cancounselling. Some psychotherapists and counsellors have been known to encourage theclaimant to pursue any claim vigorously, against the legal advice being imparted by thesolicitor.

Against this background, there is often a good claim to be made out. The solicitor’s task isto identify whether there is and, if so, what it is, on the objective evidence. The clients whoseself-centred perceptions are, in themselves, the consequences of their unhappy experiences,may make this task very difficult.

Interpretations of the problem

Solicitors are not trained to be counsellors but an ability to interpret and explain a client’sbehaviour can be of great help in conducting a case. This is most aptly illustrated whenconsidering an overtly aggressive client, with no apparent reason for this. This aggression maywell be the result of other difficulties within their life, such as a deteriorating relationshipwith a partner, husband or wife, the threat of losing a job, the perception of being ill-treatedby employers and feelings of being deserted by friends, but they convert such aggressiontowards their solicitor.

There are numerous examples of such emotional reactions. A woman assaulted at work,who felt let down by her colleagues and her employers, had a past psychiatric historyrevealing marked trauma from early childhood, subsequent trauma during the war, with greatdissatisfaction at how life had treated her. In her own mind she envisaged a sum of moneycompensation, which in reality was to compensate her for all of the trauma that she hadever suffered. She was extremely aggressive, pressurising her solicitor who was exceptionallypatient and tolerant.

Another woman who had been assaulted at work was offered reasonable compensation,but considered that this was not adequate. She had been the victim of other traumas such asthe suicide of her brother, which she failed to accept. She projected her anger and aggressiontowards her solicitor. This revealed itself by the constant bombarding of the solicitor every24–48 hours, demanding that she listen to her for long periods on the phone any hour of theday, and demanding face-to-face interviews, during which she would weep profusely. Allthese demands were well beyond the remit of the solicitor.

These severe, but not infrequent examples clearly emphasise the unspoken problems thatcan occur in the relationship of the lay person/claimant with the professional solicitor. Otheroffice colleagues on occasions can be implicated. A receptionist of a solicitor’s took a phone



call from a claimant who stated quite categorically that she was just about to kill herself. Thereceptionist kept her on the phone for three-quarters of an hour while another colleaguephoned the police. Fortunately she was saved.

It is of particular value for the solicitor to realise that personality traits can be of extremeimportance. For example, even though there might not be a frank psychiatric illness present,some people are so obsessive that they might demand more time, energy and concentrationthan is normal and indeed acceptable. There have been a number of examples of solicitorsbeing stretched in this manner.

Correspondence, such as the use of email by clients, can also cause additional pressures forthe solicitor. It is commonplace for clients who are suffering with frank psychiatric problemsor personality traits to bombard their solicitor with very lengthy emails on a regular basis.Emails, that when printed run to 30 or so pages, are frequently received, and in a bid to drawthe solicitor’s attention to certain points that the client believes are of importance, the use ofbold, underlined and coloured text is widespread.

Frequently, claimants of this nature will have difficulty in assessing what is relevant totheir case and what is not. As a result, their solicitor may be inundated with voluminousdocumentation, which they will have to sift through to determine its relevance. Indeed, someclients become obsessed with the smallest details and will criticise their solicitor openly, inthe event of such details not being considered.

On the other hand, there are also claimants who bury their heads in the sand, whichprevents them from dealing with the litigation effectively. They may fail to co-operateand assist the solicitor in the investigation of their claim. Some claimants even request thatcorrespondence from the solicitor be addressed to a close family member, so that the claimantdoes not have to deal with the contents of the letters on their own. At the same timehowever, they refuse to acknowledge their claim’s weaknesses and reject the appropriateadvice that their claim should not proceed when it is judged by the solicitor to have noreasonable prospect of success.

Those referred to the consultant psychiatrist often have been diagnosed as having frankpsychiatric illnesses such as anxiety, depression and post traumatic stress disorder. Theseillnesses will affect the claimant’s perception of events. Often they are preoccupied with theirphysical health. This can make it very difficult for the solicitor to judge what is fact and whatis false perception.

The individual’s illness can also prevent them from accepting any responsibility for thesituation in which they find themselves. There is a reluctance to accept responsibility for theirown failings and shortcomings. This too, can make it very difficult for the solicitor, when itis clear that there is an element of responsibility on the part of the claimant and when it maywell be necessary to negotiate an apportionment of liability.

The amount of work the solicitor undertakes on behalf of someone who has beendiagnosed as psychiatrically ill or as having a personality disorder and the time they requirecan be particularly draining for the solicitor and place extra strain upon the solicitor/clientrelationship.

Management of the problem

It is of paramount importance that the solicitor should retain objectivity appropriate to his orher own profession. The solicitor must of course try to appreciate that the perceptions of aclient who has been through an unpleasant and stressful experience may not fit easily with the



analytical approach of a solicitor to evidence. We have suggestions below for how solicitorsmay be trained in this respect but the solicitor must not go beyond this to attempt diagnosisfor which they are not qualified. However, we acknowledge that every client, whateverdifficulties they present, is entitled to the solicitor’s objective advice judged to be in the bestinterests of the client on the evidence.

The management of a client’s expectations is also of vital importance, and the solicitorshould ensure that their advice is recorded clearly, so that there can be no misunderstandingor misinterpretation as far as the client is concerned. Solicitors must ensure that they do notleave themselves open to allegations of professional negligence at all costs. Neither must theyallow themselves to be brow-beaten to agree aspects of the claim that they know are notjustifiable. No professional is to work under a threat.

How far has their training prepared solicitors to embrace such matters? How much shoulda solicitor know regarding personality traits and psychiatric disorders? How far are theyresponsible in dealing with the hurts and injuries that were caused prior to any of the presenttrauma and accident, which formed the basis of the present claim? In dealing with the totalhuman being there is no escape, but on the other hand it is necessary to delineate how farthe solicitor’s responsibility goes. This is a particularly pertinent question for solicitors intheir early years of practice, especially in a culture where there are escalating expectations,insatiable demands, and no tolerance of failure.

In this respect, the first interview is of paramount importance. One must consider the timelimit for such an interview. We believe that two hours is sufficient and that if the full historyis not taken in that time, it would be advisable to have a second interview.

Often the solicitor may be the very first person to have listened in some depth to thehistory of the trauma and this may also be the first time the claimant will have divulged deepfeelings and hurts associated with the trauma. This could be of emotional help to the claimantbut at the same time will constitute an emotional encounter that could prove hazardous anddifficult for the solicitor.

The solicitor must show understanding and empathy with the claimant. This does notmean collusion and agreement with all that they might say and expect.

There should be a definite understanding between solicitor and claimant regarding themanagement of the claim. The claimant should be aware of boundaries within the professionalrelationship.

Such agreement should include interviews: the frequency, time allotted, place (preferablythe solicitor’s office, not the client’s home environment). On no account should thesebe extended outside working hours with the solicitor alone in the building. Follow-upinterviews should be limited to one or one and a half hours. It must be emphasised that tohave a time limit does not mean rejection, but makes it more effective.

Again, telephone calls should be restricted within specified hours and with a maximumtime limit of 20 minutes. If there are further details to be imparted, the claimant should beencouraged to write. Again, we emphasise that to limit a session does not mean rejection anddoes not mean that the solicitor is not taking the case seriously. A long interview beyond twohours results in fatigue, lack of concentration and a tendency to repetition.

How far can the claimant’s family assist? Partners and other members of the family vary intheir support. Some give consistent encouragement whilst others are a source of stress.

Some of these cases indeed arise because of the partner’s selfish motivation. It leads one toquestion how far a claimant’s partner should be involved and indeed, whether the claimantshould at first be interviewed alone. The claimant will never be able to divulge secrets oftheir own, unless they are on their own. The presence of a partner may stifle the claimant.



At the same time, a reasonable partner or family member may later become an ally to thesolicitor.

The client is entitled to know approximately how long the case may take to reach aconclusion. It needs to be pointed out that litigation isn’t always the answer, as it may serveto exacerbate the client’s illness, therefore delaying their recovery and that there are groundrules in the medico-legal situation which have to be adhered to.

In these cases it is better that professional detachment is always maintained. Where theclaimant trusts the solicitor, the claimant is more likely to accept the solicitor’s advice.

On the other hand, the solicitor must exercise caution. They do not want the client tobecome too dependent on them or to take unfair advantage.

To illustrate matters further, one person took hours going over and over each line of theirstatement and then within 24 hours wanted to add or amend their statement further. Eventhen the claimant would not accept that it was their statement.

In another case, an industrial disease claimant phoned the solicitor three or four times aweek concerning his statement. He had a different focus at different times. Unfortunately thisobsession prevented the claimant himself listening to, or accepting advice, or the suggestedamendments of the solicitor.

In more extreme examples, clients have refused to accept the advice of their solicitorsregarding the prospects of success of their claims. In certain circumstances this can leadto a breakdown in the solicitor/client relationship, where the client then turns against thesolicitor. Indeed, one client threatened to commit suicide if the solicitor refused to pursuethe case further. It is not uncommon for clients to seek alternative advice in these cases; thetendency may be for them to ‘‘shop around’’ until they are told what they want to hear.

In detailing the above behaviour and disorders that can cause great tensions and problems forthe solicitor, one must ask how far was the GP right when suggesting during the telephonecall that the solicitor be equipped to deal with such conditions, by gaining counsellingtechniques and insights.

Conclusions

We are back where we began at the GP’s suggestion that solicitors should undertakecounselling courses in order to deal with certain claimants. It is, in our view, inappropriateto have this conception. The solicitor is not a counsellor. There should be no blurring ofthe boundaries in this respect. However, it is remarkable how much inherent counselling isbeing done by solicitors with claimants of all sorts, including those severely depressed andsuffering from severe stress disorders. However, the solicitors do it not through any sort ofspecial training, but muddle through without specific experience, from their own experienceof life, and experience of dealing with a number of people along the years. Yet how do newlyqualified solicitors deal with these matters?

The newly qualified solicitor

How far should solicitors be trained in the field? There appears to be a gap in their trainingand in subsequent supervision. Mentoring and supervision, especially in the first five years oftheir career, may help them. In particular, they should be made aware that certain personalitytraits can cause stress in a professional relationship. It is inevitable that they will be dealing



with people suffering from psychological symptoms such as anxiety, depression and stress.Without adequate training, the young solicitor is left on their own to try to learn strategiesfor coping with very practical, stressful problems which will inevitably arise.

The need for support and training

Above all, it is noteworthy that although the initial contact with the professional is almostalways positive because the claimant believes they will be helped, later if the claimantperceives that things are not going their way, that some appropriate advice does not suitthem, then a negative transference occurs and the patient will become angry, disappointedand their behaviour will reveal that. At that time, the solicitor and especially the young(inexperienced) solicitor, should have opportunities for a quick referral to a senior solicitoror supervisor to be able to ‘‘share’’ the ongoing dilemma. A case conference with more thanone colleague or with counsel can also be of help. Above all it may well be appropriate thatongoing seminars should occur where difficult clients in the firm are brought to the attentionof experienced solicitors, by individual solicitors, who can give advice and leadership, earlierrather than later. Ongoing support is so much more effective than having to extricate aprofessional from the effect of mistakes later.

Such a seminar could deal with the following: (a) how such relationships affect youpersonally; (b) how to deal with it—to accept that it is even natural for you to feel angry andeven at times inadequate, however experienced you are. It is essential to know the boundariesof involvement; (c) what advice to give and how much criticism you can take. No one isperfect. The claimants must understand that, especially when solicitors (as professionals do)do their best and try to do so much for people.

Closure

Closures are important but are dealt with badly by professionals. With the claimant it isimportant that clear cut closure occurs, that there is an apt ending and a conclusion. Variousthings can occur at that time:

• There may be complete satisfaction and appreciation.• On the other hand, there may be dissatisfaction and even anger.

It must be remembered that the solicitor may well have been seeing the claimant fortwo–five years and therefore a relationship would have been built up. The solicitor meanssomething to the claimant and the claimant may well be reluctant to finally let them go.Parting is sweet sorrow and there can be various kinds of reactions including one of relief;pleasure; reluctance; resistance and trying to continue the relationship although the casehas been completed. Again we say that conclusions are often ignored but they are veryimportant. Just as there has been a beginning there must be an end. If that is one of successand tranquillity all well and good.


Road Traffic Accidents in Europe:A Major Victory for Claimantsbefore the European Court ofJustice

MICHAEL MCPARLAND1

Claimants; Direct actions; Domicile; EC law; Insurance companies;Jurisdiction; Motor insurance; Road traffic accidents

Abstract

Michael McParland considers the decision of the European Court of Justice in thecase of FBTO Schadervezekeringen, confirming that the insurance provisions of the FifthMotor Directive permit victims of road traffic accidents in another Member State tobring direct actions against European domiciled insurers in the courts of the victim’sown domicile. ML

Outline

In a landmark decision of the December 13, 2007 the European Court of Justice has ruledthat the insurance provisions of the Brussels Regulation [2001] E.C. 44 are to be interpretedto permit victims injured in road traffic accidents in another Member State to bring directactions against European domiciled insurers in the courts of the victim’s own domicile. Thedecision confirms the interpretation of the Brussels Regulation required by the Fifth MotorInsurance Directive (Directive 2005/14/ EC of May 11, 2005), which came into force onJune 11, 2007 and removes a considerable degree of uncertainty as to the application of thatdirective. This decision is of major importance for road traffic accident victims and for theirlawyers.

FBTO Schadervezekeringen N.V. v Jack Odenbreit

The decision in question was that of the Second Chamber of the European Court of Justicein the German case of FBTO Schadervezekeringen N.V. v Jack Odenbreit (Case C-436/06)

1Michael McParland is a Barrister and Attorney at Law, State Bar of California. He can be contacted at Quadrant Chambers,Quadrant House, 10 Fleet Street, London, EC4Y 1AU and by e-mail at [email protected].



(hereinafter the FBTO case).2 The reference in the FBTO case was for a preliminaryruling concerning the interpretation of Arts 9(1)(b) and 11(2) of Council Regulation (EC)No.44/2001 of December 22, 2000 on jurisdiction and the recognition and enforcement ofjudgments in civil and commercial matters3 (the Regulation). These are part of the insuranceprovisions of the Regulation discussed below.

The reference was made in the course of proceedings between the claimant, Mr JackOdenbreit, domiciled in Germany, who on December 28, 2003 was the injured party ina road traffic accident which occurred in the Netherlands. The insurance company of theperson responsible for that accident, FBTO Schadeverzekeringen NV (FBTO), was a privatecompany established in the Netherlands.

As the injured party, Mr Odenbreit brought a direct action against the insurer, not in theNetherlands where the accident occurred, but in Germany before the Amtsgericht Aachen(Aachen Local Court), which is the court for the place where he is domiciled. This was doneon the basis of Arts 1(2) and 9(1)(b) of reg.44/2001.

By a judgment of April 27, 2005 the Aachen court dismissed the action as inadmissibleon account of the lack of jurisdiction of the German courts. Mr Odenbreit brought anappeal against that judgment before the Oberlandesgericht Koln (Higher Regional Court,Cologne). By interlocutory judgment of September 12, 2005 that appeal court recognisedthe jurisdiction of German courts over an action to establish liability, on the basis of the sameprovisions of the Regulation.

FBTO brought an appeal on a point of law (Revision) against that interlocutory judgmentbefore the Bundesgerichtshof (Federal Court of Justice), who made the following preliminaryreference to the European Court of Justice:

‘‘Is the reference to Article 9(1) (b) in Article 11(2) of . . . Regulation . . . No44/2001 . . . to be understood as meaning that the injured party may bring anaction directly against the insurer in the courts for the place in a Member Statewhere the injured party is domiciled, provided that such a direct action is permittedand the insurer is domiciled in a Member State?’’

The insurance jurisdiction provisions of the Regulation

The decision turned on the interpretation of the insurance jurisdiction provisions of theRegulation, which need to be considered in detail.

Recital 13 in the preamble to the Regulation states:

‘‘[i]n relation to insurance . . . contracts . . ., the weaker party should be protectedby rules of jurisdiction more favourable to his interests than the general rules providefor.’’

The rules of jurisdiction in matters relating to insurance are thereafter established in Ch.II,s.3 of reg.44/2001, which comprises Arts 8–14 of that Regulation.

Arts 9(1)(a) and (b) of Regulation 44/2001 provide:

2The Court decided to come to its decision without obtaining an opinion from the Advocate-General, thus the timing ofthe arrival of the decision came earlier than might normally have been anticipated and may have taken many practitionersby surprise.

3[2001] OJ L12, p.1.


ROAD TRAFFIC ACCIDENTS IN EUROPE

‘‘1. An insurer domiciled in a Member State may be sued:

(a) in the courts of the Member State where he is domiciled, or(b) in another Member State, in the case of actions brought by the policyholder,

the insured or a beneficiary, in the courts for the place where the plaintiff isdomiciled . . .’’

Art.11 of that Regulation states:

‘‘1. In respect of liability insurance, the insurer may also, if the law of the courtpermits it, be joined in proceedings which the injured party has brought againstthe insured.

2. Articles 8, 9 and 10 shall apply to actions brought by the injured party directlyagainst the insurer, where such direct actions are permitted.

3. If the law governing such direct actions provides that the policyholder or theinsured may be joined as a party to the action, the same court shall havejurisdiction over them.’’

‘‘Direct action’’ under the Motor Insurance Directives against

insurers

By Art.3 of the Fourth Motor Insurance Directive4 (the Fourth Motor Insurance Directive),the EU declared that each Member State must ensure that ‘‘injured parties’’5 enjoy a ‘‘directright of action’’ against the insurers of the responsible defendant.6 However, the Fourth MotorInsurance Directive made only vague statements regarding the question of jurisdiction, sayingin particular that:

‘‘(13) This system of having claims representatives in the injured party’s MemberState of residence affects neither the substantive law to be applied in eachindividual case nor the matter of jurisdiction. [emphasis added].

(14) The existence of a direct right of action against the insurance undertakingfor the party who has suffered loss or injury is a logical supplement to theappointment of such representatives and moreover improves the legal positionof injured parties of motor vehicle accidents occurring outside that party’sMember State of residence.

(15) In order to fill the gaps in question, it should be provided that the MemberState where the insurance undertaking is authorised should require theundertaking to appoint claims representatives resident or established in theother Member States to collect all necessary information in relation to claims

4Directive 2000/26/EC of May 16, 2000 on the approximation of the laws of the Member States relating to insuranceagainst civil liability in respect of the use of motor vehicles, etc.

5Injured parties had been defined in Art.1(2) of Directive 72/166/EC as ‘‘any person entitled to compensation in respectof any loss or injury caused by vehicles’’.

6Art.3 of the Fourth Motor Directive provides:‘‘Direct right of action‘‘Each Member State shall ensure that injured parties referred to in Article 1 in accidents within the meaningof that provision enjoy a direct right of action against the insurance undertaking covering the responsibleperson against civil liability’’.



resulting from such accidents and to take appropriate action to settle theclaims on behalf and for the account of the insurance undertaking, includingthe payment of compensation therefore; claims representatives should havesufficient powers to represent the insurance undertaking in relation to personssuffering damage from such accidents, and also to represent the insuranceundertaking before national authorities, including, where necessary,before the courts, in so far as this is compatible with the rules ofprivate international law on the conferral of jurisdiction.

(16) The activities of the claims representative are not sufficient in orderto confer jurisdiction on the courts in the injured party’s MemberState of residence if the rules of private international law on theconferral of jurisdiction do not so provide.’’ [Emphasis added.]

Furthermore, Art.1 ‘‘Scope’’ of the Fourth Motor Insurance Directive provided that thesematters were, ‘‘without prejudice to the legislation of third countries on civil liability andprivate international law. . .’’.

Therefore, the right to bring a direct action against the liability insurer only seemed toapply to accidents occurring within that Member State and did not confer jurisdiction overaccidents occurring elsewhere. This was confirmed by the implementation of the FourthMotor Insurance Directive in England and Wales.

The Fourth Motor Insurance Directive in England and Wales

The Fourth Motor Insurance Directive was implemented in England and Wales by (inter alia)in part The Motor Vehicles (Compulsory Insurance) (Information Centre and CompensationBody) Regulations 2003, and most importantly by The European Communities (Rightsagainst Insurers) Regulations 2002 SI 2002/3061 (the 2002 Regulations). The 2002Regulations came into force on the January 19, 2003.

Regulation 3 of these 2002 Regulations, provided:

‘‘Right of action

‘‘3.-(1) Paragraph (2) of this Regulation applies where an entitled party has a causeof action against an insured person in tort or (as the case may be) delict, and thatcause of action arises out of an accident.

(2)Where this paragraph applies, the entitled party7 may, without prejudice to hisright to issue proceedings against the insured person, issue proceedings against theinsurer which issued the policy of insurance relating to the insured vehicle, and thatinsurer shall be directly liable to the entitled party to the extent that he is liable tothe insured person.’’

Therefore, a direct right of action against insurers was created in English law, but the 2002Regulation limited to insurers where the accident took place in the UK8 and said nothing

7Defined as ‘‘any person who is- (a) a resident of a Member State’’.8This was certainly the view of the non-binding Explanatory Note to the 2002 Regulations:

‘‘These Regulations, giving effect to Article 3 of the Fourth Motor Insurance Directive, confer on residentsof the 15 Member States a new right to issue proceedings against the insurer of the person responsible for anaccident in the UK.’’



about obtaining jurisdiction over a foreign insurer in respect of an accident that occurredabroad. A helpful guide to the working of the Fourth Motor Insurance Directive is containedin the article by Philip Mead, The fourth European Motor Insurance Directive: use or ornament?([2007] J.P.I.L. 184–192.)

The Fifth Motor Insurance Directive

The Fifth Motor Insurance Directive (Directive 2005/14/EC of May 11, 2005) amendedthe earlier Directives and did purport to deal with issues of jurisdiction in such direct actionsagainst insurers. This directive sought to provide for this, was by directing how the insuranceprovisions of Regulation 44/2001 were to be interpreted. To further confuse matters, thiswas done by amendments to the Fourth Motor Insurance Directive:

(a) Preamble (24) which says:

‘‘Under Article 11(2) read in conjunction with Article 9(1) (b) of Council Regulation(EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition andenforcement of judgments in civil and commercial matters, injured parties maybring legal proceedings against the civil liability insurance provider in the MemberState in which they are domiciled.‘‘

(b) Article 5 provides:

‘‘Directive 2000/26/EC shall be amended as follows:1. The following recital 16a shall be inserted:‘(16a) Under Article 11(2) read in conjunction with Article 9(1)(b) of CouncilRegulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and therecognition and enforcement of judgments in civil and commercial matters, injuredparties may bring legal proceedings against the civil liability insurance provider inthe Member State in which they are domiciled.’’

(c) Article 6 which provided for ‘‘implementation’’, provides:

‘‘1.Member States shall bring into force the laws, regulations and administrativeprovisions necessary to comply with this Directive by 11 June 2007 at the latest.They shall forthwith inform the Commission thereof.’’

The effect of these amendments: The European Commission’s view

According to the European Commission, the effect of Art.5 of the Fifth Motor Directive’samendments was that, when read with Art.11(2) and Art.9(1)(b) of the reg.44/2001, the goalof providing victims the right of being able to sue in their own country is achieved. Notransitional provisions were required. This view was reflected by the UK’s own Departmentfor Transport (DoT) in their Transposition Table, which in relation to Art.5(1) of the FifthMotor Insurance Directive said:

‘‘Article 5(1) . . . introduces a new recital expressing the intention that injuredparties may sue the civil liability insurer in their country of domicile.’’



The comment from the DoT was that: ‘‘No further implementation needed because thisis merely a clarification of existing practice’’.

The decision of the ECJ

The ECJ has ruled in favour of the interpretation supported by the European Commission.The key paragraphs of the judgment are set out below:

‘‘24 Therefore, in order to reply to the question referred by the national court,it is necessary to define the scope of the reference made in Article 11(2) ofRegulation No 44/2001 to Article 9(1) (b) of that regulation. It is necessary,in particular, to establish whether that reference should be interpreted asrecognising only those courts designated in the latter provision, that is, those ofthe place of domicile of the policy holder, of the insured or of a beneficiary, ashaving jurisdiction to hear a direct action brought by the injured party againstthe insurer, or whether that reference allows the rule of jurisdiction of thecourts for the place where the plaintiff is domiciled, set out in Article 9(1)(b) ofRegulation No 44/2001, to be applied to that action.

25 It is necessary to point out, in that regard, that Article 9(1) (b) does not merelyattribute jurisdiction to the courts for the place where the persons listed thereinare domiciled, but, on the contrary, it lays down that the courts for the placewhere the plaintiff is domiciled have jurisdiction, thereby giving such personsthe option of suing the insurer before the courts for the place of their owndomicile.

26 Thus, to interpret the reference in Article 11(2) of Regulation No 44/2001 toArticle 9(1) (b) of that regulation as permitting the injured party to bringproceedings only before the courts having jurisdiction under that latterprovision, that is to say, the courts for the place of domicile of the policyholder, the insured or the beneficiary, would run counter to the actual wordingof Article 11(2). The reference leads to a widening of the scope of that rule tocategories of plaintiff other than the policy holder, the insured or the beneficiaryof the insurance contract who sue the insurer. Thus, the role of that referenceis to add injured parties to the list of plaintiffs contained in Article 9(1) (b).

27 In that regard, the application of that rule of jurisdiction to a direct actionbrought by the injured party cannot depend upon the classification of thatinjured party as a ‘beneficiary’ within the meaning of Article 9(1) (b) ofRegulation No 44/2001, since the reference to that provision in Article 11(2)thereof allows that rule of jurisdiction to be extended to such disputes withoutthe plaintiff having to belong to one of categories in Article 9(1) (b).

28 That line of reasoning is also based on a teleological interpretation of theprovisions at issue in the main proceedings. According to Recital 13 in thepreamble to Regulation No 44/2001, the regulation aims to guarantee morefavorable protection to the weaker party than the general rules of jurisdictionprovide for (see, to that effect, Group Jose, paragraph 64, Society financieredet industrially due Phlox, paragraph 40, and Case C-77/04 GEE Reunioneuropeenne and Others [2005] ECR I-4509, paragraph 17). To deny theinjured party the right to bring an action before the courts for the place of hisown domicile would deprive him of the same protection as that afforded by the



regulation to other parties regarded as weak in disputes in matters relating toinsurance and would thus be contrary to the spirit of the regulation. Moreover,as the Commission correctly observes, Regulation No 44/2001 strengthenedsuch protection as compared with the protection resulting from application ofthe Brussels Convention.

29 Such an interpretation is supported by the wording of Directive 2000/26 onmatters relating to insurance against civil liability in respect of the use of motorvehicles, as amended—after the entry into force of Regulation No 44/2001—byDirective 2005/14. In Directive 2000/26 the Community legislature not onlyprovided, in Article 3, that injured parties should have a direct right of actionagainst the insurance undertaking in the legal systems of the Member States,but also referred expressly, in Recital 16a to Articles 9(1) (b) and 11(2) ofRegulation No 44/2001 in mentioning the right of injured parties to bringproceedings against the insurer in the courts for the place where they aredomiciled.

30 As regards the consequences of allowing an injured party to bring a directaction against the insurer which, as is clear from the order for reference, is acontroversial subject in Germany, it is necessary to point out that the applicationof the rule of jurisdiction provided for by Article 9(1)(b) of Regulation No44/2001 to such an action is not precluded by the latter’s classification, innational law, as an action in tort relating to a right extrinsic to legal relationsof a contractual nature. The nature of that action in national law is of norelevance for the application of the provisions of the regulation, since thoserules of jurisdiction are contained in a section (namely Section 3 of ChapterII of the regulation) which concerns, in general, matters relating to insuranceand is distinct from those relating to special jurisdiction in matters relating toa contract or to tort or delict (namely Section 2 of that chapter). The onlycondition which Article 11(2) of Regulation No 44/2001 lays down for theapplication of that rule of jurisdiction is that such a direct action must bepermitted under the national law.

31 In light of all the foregoing considerations the reply to the question referred fora preliminary ruling must be that the reference in Article 11(2) of RegulationNo 44/2001 to Article 9(1)(b) of that regulation is to be interpreted as meaningthat the injured party may bring an action directly against the insurer before thecourts for the place in a Member State where that injured party is domiciled,provided that a direct action is permitted and the insurer is domiciled in aMember State. . .

On those grounds, the Court (Second Chamber) hereby rules:The reference in Article 11(2) of Council Regulation (EC) No 44/2001 of22 December 2000 on jurisdiction and the recognition and enforcement ofjudgments in civil and commercial matters to Article 9(1)(b) of that regulation isto be interpreted as meaning that the injured party may bring an action directlyagainst the insurer before the courts for the place in a Member State where thatinjured party is domiciled, provided that such a direct action is permitted andthe insurer is domiciled in a Member State.’’



Conclusion

Therefore, it is now established beyond doubt that a UK victim of a road traffic accidentcan bring a direct action against any European liability insurer of the tortfeasor in the courtsof their own domicile under the provisions of EC Council Regulation 44/2001. This is amajor development for claimants. The most obvious benefit9 in the near future concerns thequestion of the assessment of damages, which will in the UK (after the decision of the Houseof Lords in Harding v Wealands [2007] 2 A.C. 1) be determined in accordance with the lawof the forum.10

9At least before January 11, 2009, when the new Regulation on choice of law in tort (EC reg. 864/2007) comes intoforce whose effect will need to be worked through in detail.

10For further details on the decision in Harding in which I was counsel for Mr Harding in the conflicts matters, I referreaders to my article, Foreign Compensation Systems and Personal Injury Claims’’ in the [2007] J.P.I.L. p.273.


case and comment

Case and Comment

Liability

Office of Fair trading v Lloyds TSB Bank Plc (Hoffman, Hope, Walker, Brown andMance L.JJ.), October 31, 2007, [2007] UKHL 48, HL

Consumer credit agreements—credit cards—territorial application—foreigntransactions—extent of connected lender liability—debtor creditor supplieragreements—Consumer Credit Act 1974 s.75(1)—Consumer Credit Act 1974s.12(b)—Consumer Credit Act 1974 s.11(1)(b)—Consumer Credit Act 1974s.11(3)—Consumer Credit Act 1974 s.187(1)

Credit cards; Cross-border shopping

This case proceeded to the House of Lords after the Court of Appeal held that theConsumer Credit Act 1974 s.75(1) extended to the use of credit cards in relation to foreigntransactions. The defendants appealed arguing that if the Court of Appeal was correct theimplications would be startling. Their case was that it would mean that UK card issuers wouldbe the potential guarantors of some 29 million foreign suppliers, with whom they would nothave any direct contractual relations at all. They also argued that the whole premise of s.75(2)and s.75(5) was that a UK court would have jurisdiction over the supply transaction and thesupplier.

Their Lordships held that the 1974 Act had to be construed against the background of themarket as it existed, and was understood and foreseen at the time of the Act’s passing and ofthe Report of the Committee on Consumer Credit chaired by Lord Crowther. Furthermore,the general factors which led the Crowther Committee to recommend the imposition oncard issuers of a liability reflecting suppliers’ liability to debtors, all applied as much to overseasas to domestic supply transactions, if not more so.

As far as overseas liability was concerned, they pointed out that there would be likely to bean even greater discrepancy between the cardholder’s ability to pursue suppliers on the onehand and the ease with which card issuers could obtain redress through the contractual andcommercial ties, which Crowther contemplated would link them and suppliers. In additioncard issuers’ ability to bear irrecoverable losses and so ‘‘spread the burden’’ existed in relationto both overseas and domestic transactions.

It was accepted that, even in 1974, there had been some limited use of credit cards foroverseas transactions and the 1974 Act itself contemplated that credit agreements might haveoverseas aspects which could require special attention. While recognising that the relevantprovisions were directed at the nature of the credit agreement and of the credit providedunder it, rather than directly at the supply transaction in a debtor-creditor-supplier context,the court held that they militated nonetheless against the defendants’ submission that the1974 Act was incapable of affecting any form of credit to support an overseas transaction.

The Court of Appeal had held that it did not follow that if s.75(2) was limited torelationships between a card issuer and supplier subject to a domestic law of the UK, that

[2008] J.P.I.L. ISSUE 1/08 SWEET & MAXWELL LTD AND CONTRIBUTORS C1


confirmed that s.75(1) could not extend to overseas supply transactions. Their Lordshipspointed out that:

1. The relationship of a UK card issuer and an overseas supplier might be subject to Englishlaw.

2. Whatever the law applicable to the relationship between the UK card issuer and therelevant supplier, the issuer might very well have a right of indemnity in respect of sumspaid compulsorily under s.75(1).1

3. The Crowther Report did not suggest that liability under s.75(1) depended on theexistence of an effective indemnity.

4. Section 75(2) was itself subject to any contrary agreement.

An important point recognised by the Crowther Report was that the effect of s.75(1)would be to impose on card issuers irrecoverable losses. They took the view that the cardissuers were better able to bear them than cardholders. In addition an overseas supplier wouldbe less easily brought before a UK court than a domestic supplier, and might simply ignoreany attempt to join him. Whatever rules of court might provide, any UK judgment mightnot be enforceable against such a supplier here or anywhere.

Key to this decision is the fact that it was a principal theme of the Crowther Report thatcreditors would have a strong contractual and commercial influence over their suppliers andthat, where resort could not be had to such suppliers, losses were better borne by creditors,who could spread them over the public at large, than by debtors.

In the circumstances, they held that the only limitation on the territorial scope of s.75(1)was that the credit agreement had to be a UK credit agreement. The appeal was unanimouslyrejected.

Commentary: At first glance the reader may wonder why a commercial contracts casearising from the Consumer Credit Act 1974 should need a comment within a Personal InjuryJournal. The reason is that this case supports an ancillary remedy for the victim of anaccident that takes place abroad or indeed from any venture involving the purchase of anitem by credit card which directly leads to injury. By the House of Lords determining that theprotection extended to a consumer by s.75(1) of the Consumer Credit Act of being able toseek remedy against the credit card company as well as or instead of the other contractingparty, it means that where it is impracticable or indeed impossible to pursue a claim forpersonal injuries against the tortfeasor the remedy may be somewhat closer to home.

Section 75 gives rise to the liability of the creditor for breaches by the supplier for serviceswhich cost between £100–£30,000:

‘‘(1) if the debtor under a debtor-creditor-supplier agreement falling within section12(b) or (c) has, in relation to a transaction financed by the agreement, any claimagainst the supplier in respect of the misrepresentation or breach of contract, heshall have a like claim against the creditor who, with the supplier, shall accordinglybe jointly and severally liable to the debtor.’’

The first reference to this potential remedy that I saw was the unreported case of Grove vAmerican Europe Ltd.2 This case involved an accident in France in 2001 where the claimant

1They held that it could not be assumed that Parliament envisaged that s.75(2) would be the only route to an indemnity.2(2003) April 28, H.H. Behar, Wandsworth County Court.

C2 [2008] J.P.I.L. ISSUE 1/08 SWEET & MAXWELL LTD AND CONTRIBUTORS

CASE AND COMMENT

alleged that he fell while coming down the outside staircase at his hotel. He argued that thehotel was in breach of an implied contractual term to exercise reasonable care and skill toensure that he was kept safe. The hotel denied this and it made no admissions with regard tothe circumstances of the accident. This enterprising claimant sued American Express unders.75(1) of the Consumer Credit Act 1974. American Express denied that this Act applied totransactions which were governed by French law and which were performed overseas. Atthe same time American Express also joined the hotel as a Part 20 Defendant by referenceto s.75(2). There was a preliminary issue trial, which was to determine whether the Act didapply outside this jurisdiction and the Judge held that the supply contract (being the purchaseof the hotel accommodation) was financed by the Consumer Credit Agreement which wasgoverned by English law and consequently held that American Express had to pay.

It was this argument that led to the Office of Fair Trading deciding to seek a declarationon a test case in agreement with various credit card providers. In March 2006 the Court ofAppeal took the same view on the test case appeal as H.H. Judge Behar had in the Grovecase. Then the Lords upheld the Court of Appeal’s view that UK credit card issuers werejointly liable with suppliers under s.75(1) of the Act in cases of misrepresentation or breachof contract, whether the purchases were made in Britain or overseas.

Dismissing the appeal, Lord Mance said:

‘‘there is nothing in the 1974 Act to introduce or require any further limitationin the territorial scope of section 75(1), other than that the credit agreementmust be a United Kingdom credit agreement. I therefore reject the appellant cardissuers’ submission that section 75(1) is limited in application to domestic supplytransactions and so inapplicable to overseas supply transactions, however defined.’’

So the claimant who has suffered an injury directly involving a product or service purchasedby their credit card, now has this additional option of pursuing the claim in the UK courtsby reason of the jurisdiction afforded to it by the residents of the relevant issuing bank.This may be a more attractive proposition than pursuing a claim against the supplier in theirjurisdiction, usually being abroad. It may also assist in cases where the tortfeasor may beuninisured and impecunious.

This decision may take on even more significance following a disappointing determinationby the Court of Appeal, which has had the effect of reducing the number of holidays that maybe considered to be package holidays and thereby affording the remedy to the Claimant ofthe Package Tour Regulations.3

In R. (on the application of ABTA) v CAA and Passand DTI4 ABTA appealed unsuccessfullyagainst the decision that package holidays required a ‘‘pre-arranged combination’’ of thecomponents of a package for it to be considered to come within the definition of a packageholiday. Previously, it was believed that a travel agent assembling a holiday with the provisionof for instance, travel and accommodation together would constitute a package and thereforeenable the claimant to pursue the claim in the jurisdiction of the travel agent. This decisionwhich was in the context of a Judicial Review relating to regulatory affairs of the Civil Aviationand ABTA, has meant that a large number of holidays which would previously have comewithin the Package Tour Regulations now fall without, meaning that the claimant would have

3Package Travel, Package Holidays and Package Tour Regulations 19924[2006] EWCA Civ 1299



to pursue a claim against the owner and/or occupier of the accommodation, for examplein the foreign jurisdiction. It may be that a more attractive proposition would be to sue thecredit card supplier in the UK courts, albeit that they would inevitably join in the tortfeasor inthe UK proceedings.

Pursuing claims for accidents abroad has always been a specialised area of work and thisdecision (and indeed the ABTA case) serve to remind one of how difficult these can be.

Practice point: When acting for a claimant following an accident abroad, or in any casewhere there may be a question mark over the insurance or means of the defendant, considerwhether a Consumer Credit Act claim may be a necessary remedy. If it may be, then considerwhether the quantum may exceed £30,000.

Commentary by Mark Harvey

Conn v Sunderland CC (Ward, Buxton and Gage L.JJ.), November 7, 2007,unreported elsewhere, [2007] CA (Civ Div)

Employers liability—stress—harassment—bullying at work—criminal conduct --- courseof conduct—Protection from Harassment Act 1997

Bullying; Criminal liability; Harassment; Offensive behaviour

William Conn had worked for many years as a paviour for Sunderland CC. He claimed thathe had been harassed and threatened by his foreman on several occasions. He left work andissued proceedings claiming damages for a breach of the Protection from Harassment Act1997. At first instance the judge found that Conn’s psychiatric injury had not been caused byevents at work so his claim in negligence failed. However he found that on two occasionsthe foreman had lost his temper and acted in an aggressive manner threatening violence.

The relevant findings of fact were that:

• on one occasion the foreman had demanded to know (from three of his subordinatesincluding Mr Conn) who had left work early and when Conn and the others refusedto tell him he shouted and threatened to punch out the window and have them all upbefore the personnel department; and

• on the second occasion the foreman approached Conn to ask why he was not talkingto him; he was incensed at being given ‘‘the silent treatment’’ with the result that hehad sworn at Conn threatening him with a hiding.

The trial judge held that there had been a course of conduct that the foreman knew,or ought to have known, amounted to harassment. Conn had proved that on those twooccasions the foreman had acted in an unacceptable fashion and that those two occasionsconstituted a course of conduct prohibited by the 1997 Act. Following the House of Lordsdecision in Majrowski v Guy’s and St Thomas’s NHS Trust [2007] 1 A.C. 224, the judgeheld that the Council were vicariously liable for that harassment and awarded Conn £2,000damages and 75 per cent of his costs. The local authority appealed.

The Court of Appeal held that for an offence of harassment to be made out there hasto be a course of conduct, which, under s.7(3) of the Act has to be at least two incidents.A civil claim for harassment is only available for conduct that amounts to a breach of s.1.


CASE AND COMMENT

Gage L.J. said that it was established that an employer could be held vicariously liable foracts of harassment contrary to the 1997 Act, perpetrated by one employee against anothersince a civil remedy was available pursuant to s.3 of the Act in respect of actual or threatenedbreaches of s.1, which referred to a ‘‘course of conduct’’, and for which two instances ofharassment were required.

He held that in any particular case, the question would arise whether ‘‘harassment’’ wasmade out. The definition was left ‘‘deliberately wide’’,5 although the term included alarming aperson or causing distress.6 Concern had been noted that employers might face unmeritoriousclaims. However, applying dicta of Lord Nicholls of Birkenhead7, he concluded that thecourts were well able to recognise the boundary between conduct that was unattractive,even unreasonable, and conduct which was oppressive and unacceptable. The touchstoneof whether the facts in a particular case crossed the boundary from the regrettable to theunacceptable, was said to be, to ask whether the gravity of the misconduct was of an orderwhich would sustain criminal liability under s.2 of the Act.

The Court of Appeal had little hesitation in allowing the appeal and underlined inforthright terms the requirement that the conduct in question has to be both oppressive andunacceptable. The window incident had not been targeted at Mr Conn but involved otherworkers, neither of whom had found such behaviour intimidating. It fell far short of the typeof conduct criminalised by the 1997 Act.

They concluded that application of that test to the facts of this case showed that therequired course of conduct had not been made out. The appeal was allowed.

Commentary: It is important to note that the claimant was originally seeking a six figuresum by way of damages. Thus, this was basically a stress at work claim which failed withthe claimant being awarded the consolation prize at first instance of £2,000 in respect of abreach of the Protection from Harassment Act 1997 for which his employers were vicariouslyliable, pursuant to the House of Lords decision in Majrowski. It is also worth noting that thelocal authority appealed on two grounds, namely that the relevant breach under the Act hadnot been made out but also that the trial judge’s award to the claimant of 75 per cent of hiscosts was an incorrect exercise of his discretion.

Ever since the decision in Hatton v Sutherland [2002] I.C.I. 613, practitioners have knownthat claimants face an uphill struggle in these stress cases and the position has not beenmade any easier in subsequent Court of Appeal decisions. In order to succeed in such aclaim, a claimant has to prove that there was a foreseeable risk of him suffering psychiatricinjury and that by reason of the employer’s breach of duty for failing to minimise the risk ofthe claimant suffering such an injury, the claimant did in fact suffer a recognised psychiatricinjury. With so many hurdles to surmount, it is not surprising that so many of these claimseither fail or never get off the ground in the first place.

However, under the Protection from Harassment Act 1997, the offence of harassment iscreated and under s.3, a civil remedy is provided for whereby a claimant may be awardeddamages for any anxiety or financial loss caused by the harassment. There is no requirementto prove forseeability of a psychiatric injury. Nor that the claimant has actually suffered arecognised psychiatric injury. Therefore, in order to succeed in a civil claim under the Act, it

5Per Baroness Hale of Richmond in Majrowski at [66].6Section 7(2) references to harassing a person include alarming the person or causing the person distress.7See the Majrowski case at [30].



appears at first sight that a claimant has less hurdles to surmount or at any rate, the hurdlesthat he does have to surmount are significantly lower.

As a result, it has become the practice in common law stress claims involving bullying orharassment at work to plead cases in the alternative so that if the claimant cannot satisfythe burdens in the common law claim, they may find it easier to succeed in a claim underthe Act.

In this case, the claimant scraped home at first instance because the trial judge heldthat the two occasions involving the foreman constituted a course of conduct amountingto harassment. Since the claimant could not establish that these incidents caused hispsychiatric injury, he was only awarded £2,000.

The Court of Appeal clearly did not like this. While accepting that an employer could beliable for a course of conduct involving only two incidents, they found that on the particularfacts of this case, the first incident did not form part of a course of conduct in that it involvedthree employees together and a threat to property rather than to the person.

Importantly however, they made it perfectly clear that the Act was concerned with criminalbehaviour and for behaviour to cross that line such that it became criminal, it had to beboth oppressive and unacceptable. Unpleasant conduct alone was not sufficient to justify acriminal sanction.

In my view, the court was sending out a clear message that courts should be slow to allowthe proliferation of low value claims as a result of boorish and ill-tempered behaviour in theworkplace.

Given their finding on the facts of this case, it was unnecessary for them to consider theappeal on costs. However, it would have been interesting to know what the court would havedone if the claimant had not lost the appeal on liability. In Kew v Bettamix [2006] EWCA Civ1535, the Court of Appeal made it clear that where a claimant succeeded in his claim butlost on issues which involved substantial costs being incurred, they should not be awardedthe full costs. In this case, presumably mindful of that decision, the trial judge had awardedthe claimant 75 per cent of his costs.

However, this claim had originally been a six figure claim justifying the instruction ofsenior counsel on both sides as well as expert evidence on the issue of causation. In theevent, the claimant succeeded on the basis of two short incidents which would not haveinvolved a great deal of evidence and costs being incurred and was awarded a fairly nominalsum which presumably bore no relation to the schedule and counter schedule before thecourt.

I would have thought that even if the appeal on liability had failed, the local authority hadreasonable prospects of establishing that the claimant should not have been awarded 75per cent of his costs when he had lost on the main claim, which had resulted in the vastmajority of the costs being incurred and in fact received only a tiny sum in comparison withwhat was claimed.

Therefore, in conclusion, it may be that there are hurdles to be surmounted in a claimunder the Protection from Harassment Act 1997 a little higher than some practitionersconsidered and practitioners should not assume that proceedings which fail on the maincause of action and only succeed to a limited extent on the secondary cause of action willbe cost-effective.


CASE AND COMMENT

Practice points:

• When assessing a claim under the Protection from Harassment Act 1997, practitionersshould consider whether the individual incidents of behaviour complained of crossedthe line from mere unpleasantness to criminality;

• If after such an assessment, practitioners consider that a claimant does have a viableclaim under the Act, they should be wary of joining it with a weaker common law claimas the common law claim is likely to involve considerably more costs. It that fails, theproceedings may not be cost-effective even if the statutory claim succeeds.

Commentary by Nigel Cooksley Q.C.

Ellis v William Cook Leeds Ltd (Chadwick, May and Moore-Bick L.JJ.), November1, 2007 [2007] EWCA Civ 1232, CA (Civ Div)

Personal injury—accidents at work—employers’ liability—foreseeability—Provi-sion and Use of Work Equipment Regulations 1998 reg.4(3)—Lifting Operationand Lifting Equipment Regulations 1998 reg.8(1)(c)—safe system of work—negli-gence—contributory negligence—lack of expert evidence

Accidents; Contributory negligence; Employers’ liability; Personal injury

The claimant, Philip Ellis, then aged 38, was injured quite badly at work on April 5, 2004. Hewas employed by the defendants, William Cook Leeds Ltd, as a shot blast man and had beensince January 1997. He had considerable experience and had received considerable training.

Mr Ellis remembered nothing of the accident itself. Although there were others workingwith him or in the vicinity, no one who gave evidence at the trial actually saw the accidentitself, or exactly how Mr Ellis was injured. When H.H. Judge Langan gave judgment onFebruary 10, 2007, he had to reconstruct by inference from rather meagre direct evidencewhy and how the accident occurred. In addition, there was no engineering or other expertevidence to help the court. When dealt with by the Court of Appeal, May L.J. inferred fromreferences in the judge’s judgment that he rather regretted that a district judge had beenpersuaded by the defendants not to permit expert evidence. The defendants said the pleadedcase did not require expert evidence, but May L.J. was not convinced that that was reallyright.

It was accepted that Mr Ellis’s job included moving steel castings placed on trays using acrane with a hand held control. When castings fell off the tray it was normal working practicefor them to be moved by the crane, provided they had not become jammed. Philip Ellis wasinjured when he was trying to remove a cone shaped casting that had fallen. He attached ahook from the crane to the narrow end of the casting and operated the hand held control.However the hook flew off and hit him in the face, knocking him unconscious.

On examination after the accident it was discovered that the hook was bent beyond it’snormal tolerance. At the trial Ellis gave evidence that when he removed his finger fromthe button of the hand-held control, the crane would continue to lift for approximatelyone-and-a half inches. The judge held that it was likely that the casting had become jammedand that this was reasonably foreseeable. He also held that it was not likely that Ellis continuedlifting when the casting became jammed but that it was likely that he stopped lifting and



the crane continued to lift. The judge concluded that the working practice was inherentlydangerous and liability was established. He went on to hold that Philip Ellis was guilty ofcontributory negligence as he had stood too near the crane. He deducted 25 per cent. Thedefendants appealed both on primary liability and in the alternative the level of the deduction.

The Court of Appeal transcript tells us that the Particulars of Claim alleged numerousbreaches of regulations without specifying them. However they noted that the trial judgereferred to two of them in particular: reg.4(3)8 of the Provision and Use of Work Regulations1998 and para.8(1)(C)9 of the Lifting Operation and Lifting Equipment Regulations 1998.They say no more. In particular we are not told if either of these breaches (or indeed anyothers) were held to have been established.

For some inexplicable reason the Court of Appeal, in this case, saw no need to explore thedifference between strict liability statutory duties imposed on employers and simple commonlaw negligence. It is well established that there is often a significant difference between thetwo. As Lord Hoffman famously said:10

‘‘A person [as in the case of an employer] may be responsible although he has notbeen careless at all, as in the case of breach of an absolute statutory duty. And he mayhave been careless without being responsible, as in the case of ‘acts of inattention’by workmen.’’

The Court of Appeal held that there was no evidence for the finding that the cranecontinued to exert pulling force after Ellis removed his finger from the button. In their viewif the casting was jammed there could be no movement and the question was not whether thecrane continued to move but whether it continued to exert pulling power. Without expertevidence they held that this was so inherently unlikely that the judge should have rejected it.

They accepted that attempting to move a casting that was at risk of jamming using a hook,which could slip under the load, was extrinsically dangerous. It was extrinsically possible thatthe hook would slip whether it was deformed or not. There was no challenge to the findingthat it was reasonably foreseeable that the casting may become jammed and, therefore, usingthat crane to lift that casting in those circumstances was not a safe system of work.

They concluded that this meant the trial judge’s findings on liability were correct but notfor the reasons he found. They went on to draw their own conclusions from the limitedinformation available. They decided that it was likely that Ellis was in fact trying to dislodgethe casting that had become jammed. They held that it was not sensible for him to performthe operation where he had been standing and that meant the judge’s finding on contributorynegligence was too low. They held that it should have been 50 per cent and to that extentthe appeal was allowed. One can only wonder what the outcome would have been if thestatutory duties had been considered.

Commentary: This case raises some interesting points, of general application inemployer’s liability claims, concerning the scope of workplace regulations, the need forexpert evidence in the context of those regulations and apportionment to reflect contributorynegligence. To some extent all of these issues are linked.

8This requires every employer to ensure that work equipment is used only for operations for which and under conditionsfor which it is suitable (‘‘suitable’’ meaning in any respect which it is reasonably foreseeable will affect the health andsafety of any person).

9This requires that every employer shall ensure that every lifting operation involving lifting equipment is carried out in asafe manner.

10See Reeves v Commissioner of Metropolitan Police [2000] 1 A.C. 360.


CASE AND COMMENT

Regulations: The claimant relied upon reg.4(3) of the Provision and Use of Work EquipmentRegulations (PUWER) 1998 and reg.8(1)(c) of the Lifting Operation and Lifting EquipmentRegulations (LOLER) 1998.

Much of the difficulty in this case seems to have arisen from a degree of uncertainty aboutthe precise mechanics of the accident and the extent to which the claimant needed to provethese, and that they were reasonably foreseeable by the defendant, in order to establishliability.

Before turning to the approach adopted by the court, about exactly what the claimantneeded to prove, it is worth looking at the terms of Reg.8(1)(c) of LOLER and cases whichhave considered the general approach to determining whether similar provisions have beenbreached.

The relevant part of Reg.8 provides:

‘‘(1) Every employer shall ensure that every lifting operation involving liftingequipment is. . .. (c) carried out in a safe manner’’

The obligation, therefore, is that a ‘‘lifting operation involving lifting equipment’’ mustbe ‘‘safe’’. This is an absolute obligation, with no statutory defence, even of reasonablepracticability.

There is ample support for the view that such a duty is concerned with the end result, notsteps towards achieving that result or the precise circumstances leading to what occurred.For example in Galashiels Gas Co Ltd v Millar [1949] A.C. 275, Lord MacDermott observed,when dealing with another regulation imposing an absolute duty, that ‘‘. . ..the definitiondescribes a result to be achieved rather than the means of achieving it’’.

More recently, adopting the same general approach, in McGowan v W. & J.R. Watson[2006] C.S.I.H. 62, the Inner House accepted the first instance decision of the Lord Ordinary,dealing with reg.11 of PUWER, that liability was established because ‘‘. . . the result requiredby the regulations was not achieved’’.

The question, about the correct approach to proving breach of reg.8, is whether, whenlooking at the objective to be achieved, it is necessary for the claimant to prove the injuryoccurred because the operation was unsafe, in the sense that the actual mechanics of theaccident were reasonably foreseeable by the defendant. In other words, does the objectivethat the lifting operation is ‘‘safe’’ import a requirement of reasonable foreseeability on thepart of the defendant?

The meaning of ‘‘safe’’, although in a different regulation, was considered by the Court ofAppeal in Larner v British Steel Plc [1993] 4 All E.R. 102. The answer to the question aboutthe need for reasonable foreseeability was that ‘‘safe’’ should not be interpreted to mean‘‘safe from a reasonably foreseeable danger’’. The reason for declining to import the need forforeseeability into a statutory duty was that such an approach would reduce the protectionafforded by measures specifically designed to protect workers, which would really then addnothing to the common law duty.

Consequently, it would seem that the correct approach is to interpreting regulations whichrequire a ‘‘safe’’ outcome is just to consider what occurred and ask, albeit after the event,whether that outcome has been achieved.

On the facts of this case, when considering if there was a breach of reg.8(1)(c) of LOLER,such an approach would simply involve asking whether, given the accident occurred duringa ‘‘lifting operation involving lifting equipment’’, such operation had been carried out in a



‘‘safe’’ manner. The very fact of the claimant’s injury, inflicted by part of the lifting equipment,would seem to suggest not, without the claimant needing to do more in terms of proving theprecise mechanics of the accident let alone that these were reasonably foreseeable by thedefendant.

This approach is, of course, very different from a claim based on the employer’s commonlaw duty of care under the law of negligence. There breach will depend upon reasonableness,which, in turn, may depend upon foreseeability of the events that amounted to the allegedbreach. However, for the reasons explained by the Court of Appeal in Larner, workplaceregulations are intended to be more rigorous than the common law duty.

The claimant, of course, also relied on reg.4(3) of PUWER. It is, again, important to lookat the precise wording of the regulation relied on. This requires that:

‘‘Every employer shall ensure that work equipment is used only for operations forwhich, and under conditions for which, it is suitable.’’

The question here is whether the word ‘‘suitable’’ introduces the need for foreseeability sofar as this regulation is concerned.

The answer to this question is found in reg.4(4) which defines ‘‘suitable’’ as meaning,‘‘suitable in any respect which it is reasonably foreseeable will affect the health or safety ofany person’’.

However, even with specific reference to the need for reasonable foreseeability the Houseof Lords held in Robb v Salamis (M & I) Ltd [2006] U.K.H.L. 56 that, when dealing with thistype of regulation, the meaning of foreseeability has to be examined in its context. Thatimports an obligation to anticipate situations which may give rise to accidents, rather thanwaiting for them to happen. Thus, so far as this regulation is concerned, it might be necessaryto establish the circumstances, in order to assess whether these were foreseeable, but areasonable employer must be taken to be imaginative in contemplating what might happenand certainly should take account of workers often failing to do what they are specificallyinstructed.

With this background in mind, some extracts from the judgment of May L.J. given in theCourt of Appeal are of interest, hinting that the approach adopted to the claim was more oncommon law than statutory duty lines. For example:

‘‘The Particulars (of Claim) are . . . uninformative as to the way in which and themechanism by which the accident is said to have happened.’’

‘‘The judge considered the operation to have been inherently dangerous, since itwas obvious even to a layman that the change of an object such as the spindleswinging from the hook when it was lifted could not be discounted. The possibility ofthe spindle becoming jammed was foreseeable. The consequences of the continuedexertion of force on the load after the button was released was also foreseeable.’’

‘‘It seems to me that neither the parties nor the judge at trial concentrated perhapssufficiently on the true reason why Mr Ellis was hit in the face.’’

‘‘. . . attempting to move a casting which was at risk of jamming, by means of thishook inserted into this unflanged aperture at its narrow end, which could slip underload, was intrinsically dangerous.’’


CASE AND COMMENT

‘‘. . . it was foreseeable that a casting of this kind might become jammed. Thatbeing so, using this crane with these hooks to move the slipped casting was not,in my view, a safe system of work. On this basis the Judge’s finding on liability issupportable, although not for the precise reasons he gave.’’

This case was not, at least so far as the regulations relied upon were concerned, aboutthe common law duty to provide a safe system of work, but simply whether the specificregulations relied upon had been breached. Ultimately, however, by focussing upon the factthe claimant had suffered an injury, the court found liability had been established.

Perhaps all that really needed to be said was that, given the injury suffered by the claimant,the lifting operation could not have been ‘‘carried out in a safe manner’’, or at least it was forthe defendant to establish the operation was ‘‘safe’’, so that without going further into theprecise circumstances there must have been a breach of LOLER.

Determining the correct approach to the regulation relied on, and hence what the claimanthad to prove to establish breach, was also crucial to an assessment of the evidence required,including expert evidence on liability.

Expert evidence: The claimant, presumably on the basis it would be helpful to haveevidence dealing with the mechanics of the accident, sought permission, at the stage ofcase management, to rely on expert evidence dealing with liability. The defendant objected.The district judge refused the claimant permission to rely on such evidence.

The Court of Appeal was not impressed by the defendant having made that objection atthe stage of case management yet subsequently contending, without such evidence, theclaimant could not establish the accident occurred in the way the trial judge found.

On this point May L.J. observed:

‘‘Furthermore, there was no engineering or other expert evidence to help the court,and I infer from references in the judge’s judgment that he rather regretted that adistrict judge had been persuaded by the Defendant not to permit expert evidence.Mr Evans, on behalf of the Defendants, said this morning that the pleaded case didnot require expert evidence, but I am not convinced that that is really right.’’

Part 35.1 of the Civil Procedure Rules (CPR) provides that ‘‘expert evidence shall berestricted to that which is reasonable required to resolve the proceedings’’. There are fewdecisions that consider when such evidence is ‘‘reasonably required’’ for these purposes sothe approach in this case is of interest.

If a claim based on breach of statutory duty is concerned more with the end result than themeans of achieving that result there is, clearly, some force in the defendant’s submission thatsuch evidence was not required in this case. However, once it became clear the case woulddevelop along the lines it did, looking at the mechanics of the accident, then surely suchevidence was ‘‘reasonably required’’ and should have been allowed. Despite the observationsof the Court of Appeal the defendant’s stance, in relation to expert evidence, may have beentechnically correct, yet it was clearly difficult for the defendant to then take the point, havingapparently allowed the claimant to accept a rather greater burden than might have beennecessary in establishing the factual background.

More generally, when considering what expert evidence is ‘‘reasonably required’’ much willdepend upon precisely what the claimant needs to establish in order to prove liability. Wherethe court is likely to need information, above and beyond that which can be provided by the



witnesses of fact, in order to establish the factual background or fully understand the factualevidence, there is a strong argument expert evidence is reasonably required. The need forsuch evidence will, in these circumstances, remain even in a claim of modest value for thereasons given by Neuberger J. (as he then was) in Layland v Fairview New Homes Plc [2002]E.W.H.C. 1350 (Ch) when he observed:

‘‘A Claimant with a small claim is entitled to the same treatment, in terms ofsubstantive and procedural justice, as a Claimant with a large claim. That is notinconsistent with the concept of proportionality. Proportionality involves the courtensuring that, subject always to the fundamental and overriding requirement thatevery case is disposed of justly, the resources, in terms of costs effort and time,devoted to a case are appropriate to what is at stage in that case. Hence thenumber of expert witnesses or the expert of disclosure directed by the court maybe influenced by, inter alia, the amount at stake. However, at least in my firm view,proportionality cannot be invoked to deprive a party of a direction, without whichthere would be a real risk of there not being a fair trial, or of some other injusticebeing perpetrated. It is right to add that, in some cases, particularly whether justiceor fairness require a balancing exercise, proportionality itself will be a relevantfactor in deciding what justice and fairness require.’’

Contributory Negligence: Perhaps the focus on common law, rather than statutory,principles may also have influenced the apportionment to reflect contributory negli-gence.

In Toole v Bolton MBC [2002] EWCA Civ 588, Buxton L.J. noted the following:

‘‘It is not usual for there to be marked findings of contributory negligence in abreach of statutory duty case . . .’’

That judgment went on to refer to the well know words of Lord Tucker in Staveley Iron &Chemical Co Ltd v Jones [1956] A.C. 672, when he said:

‘‘In Factory Act cases the purpose of imposing the absolute obligation is to protectthe workmen against those very acts of inattention which are sometimes reliedupon as constituting contributory negligence so that too strict a standard woulddefeat the object of the statute.’’

It is also questionable whether an appellate court should readily interfere in apportionment.For example in Robb the House of Lords expressly adopted the approach of cases suggestingthis should only happen in ‘‘exceptional circumstances’’. There is nothing in the judgment tosuggest this was such a case.

Practice points:• Use of Workplace Regulations:

• These should always be pleaded, and relied upon, where available.• The precise terms of any regulation relied upon needs to be considered in order

to assess exactly what the claimant needs to prove, or the defendant needs todispute, to determine liability.


CASE AND COMMENT

• Ideally the parties should agree exactly what is required to be proved toestablish breach of the regulation so as to define what evidence, includingexpert evidence, will be necessary.

• Expert Evidence:

• If the precise mechanics or circumstances of the accident do not need to beestablished, expert evidence may be unnecessary as the court is likely to beable to determine whether the objective of the regulation has been achievedby reference to the factual evidence. However, even in such a case, expertevidence might be needed if a defence of reasonable practicability exists inorder to help determine whether this applies.

• If the circumstances of the accident do need to be established, in order to proveliability, expert evidence may often be ‘‘reasonably required’’, for the purposesof Pt.35, to help the court interpret the factual evidence and make findings offact necessary to determine liability. In such circumstances, the observations ofMay L.J. in this case may be cited in support of any application for permissionto rely on such evidence, along with the views of Neuberger J. in the Laylandcase if there are arguments about proportionality in a smaller claim.

• Contributory negligence:

• It is important to remain aware of the distinction between contributory negligenceand momentary inattention which, in a case involving employer’s liability, shouldnot attract any deduction.

• Reliance should be placed on those cases which deal with breaches of statutoryduty, in the workplace context, and explain how the court should approachapportionment in such claims.

• If there is an appeal the appellate court needs to be aware of the authoritieswhich suggest an apportionment should only be adjusted in exceptional cases.

Quantum

Cameron v Vinters Defence Systems Ltd (Holland J.), October 12, 2007, [2007]EWHC 2267 (QB) QBD

Personal injury—quantum—fatal accident claims—damages for pain and suf-fering—deductions—mesothelioma—overlap of damages—meaning of ‘‘bene-fit’’—Fatal Accidents Act 1976 s.4—credit for awards under pneumoconiosis etc.(Workers’ Compensation) Act 1979

Benefits; Fatal accident claims; Fatal accidents; Measure of damages;Mesothelioma; Personal injury

Between 1958 and 1960, Donald Cameron worked for the defendants’ predecessor in title atthe Palmers Hebburn Shipyard on Tyneside. There he was regularly exposed to asbestos in



large quantities. On the October 9, 2004 he died due to a malignant mesothelioma, whichit was admitted was probability due to exposure to asbestos. His widow Margaret Cameronsued and liability was admitted.

There were two issues on the quantum of damages for pain and suffering and if credit shouldbe given for a payment made under the Pneumoconiosis Etc. (Workers’ Compensation) Act1979 was a ‘‘benefit’’ for the purpose of the Fatal Accidents Act 1976 s.4. If so it could notbe taken into account when assessing damages under the 1976 Act.

In this case the history leading up to death, was that until a period some five or six monthsprior to it, Mr Cameron had been seemingly healthy and vigorous and a smoker. Come thisperiod, he became breathless and he lost his appetite. The family reacted by pestering himto go to hospital. This pressure he resisted until the September 1. A visit to his GP led onto an emergency admission to hospital. There he remained until September 23, undergoinginvestigative procedures and tests. When he came out of hospital he went straight to bed.For the rest of the short time he survived, his wife had to do everything for him.

The defendants’ attempted to rely on an unreported decision of H.H. Judge Waltonsitting at Newcastle upon Tyne County Court made on the January 17, 2007 when heassessed damages for pain and suffering at £20,000. In that case the 79-year-old deceased hadexperienced the symptoms of his terminal mesothelioma for just six weeks.

Holland J. noted that the guidance offered by the current Judicial Studies Board (JSB)Guidelines (£47,850–£74,300) is subject to the comment ‘‘for periods up to 18 monthsawards in the bottom half of the bracket may be appropriate’’. The question was what followsif the period is a merciful but devastating six months or less. His answer came in para.7:

‘‘Turning myself into a jury, my starting point has to be the Guidelines I can departfrom such, but only with justification. I remind myself of the point made by DavidFoskett QC sitting as a High Court Judge:

‘it is an invidious exercise to draw fine distinctions between the sufferingof victims of mesothelioma. It is a most dreadful terminal disease withextremely painful and distressing symptoms. That consideration remainswhether those symptoms have been endured over merely a matter ofmonths or for a year or longer.’

In the event, I do think that some departure from the Guidelines is justified byreason of the relative brevity of the period of suffering, but only some.’’

His jury assessment was £35,000.Turning to the second issue, he recognised that s.4 of the 1976 Act requires the court to

disregard benefits that, because they arose out of the deceased’s death, are the dependant’s inany event. On February 22, 2006 Mrs Cameron was awarded and received £4,496 underthe Pneumoconiosis Etc (Worker’s Compensation) Act 1979. The judge held that the awardunder the 1979 Act resulted from the death of Mr Cameron. To that extent it fulfilled therequirements of s.411 of the 1976 Act.

On a proper construction of s.4 of the 1976 Act, whether the award was a ‘‘benefit’’could not be reflected by the result of timetabling, not least when the terms ‘‘have’’, ‘‘may’’or ‘‘will’’ in s.4 of the 1976 Act seemed aimed at deliberately excluding such a factor. Mrs

11‘‘In assessing damages in respect of a person’s death in an action under this Act, benefits which have accruedor will or may accrue to any person from his estate or otherwise as a result of his death shall be disregarded.’’


CASE AND COMMENT

Cameron therefore had to give credit for the sum received in relation to her claim under the1979 Act.

However, the award was not a ‘‘benefit’’ that accrued to Mrs Cameron in any event soas to come within the scope of s.4 of the 1976 Act. It only arguably came within s.4 of the1976 Act because at the commencement of the proceedings it had in fact accrued.

The 1979 Act was designed to compensate when, unlike here, there is no compensatingdefendant. Payments under the 1979 act arise under s.1(2) if on a claim by the dependantof a person who immediately before he died, was disabled by a disease to which the actapplies and the Secretary of State is satisfied that the conditions of entitlement mentioned ins.(2(2)(b)12 are fulfilled.

The judge noted that the widow’s entitlement to the payment reflected shrewd timetablingadopted by her solicitors, which took advantage of the Department for Transport, LocalGovernment and the Regions’ liberal approach to exercising the powers granted by the 1979Act. He commented that had the proceedings been commenced in a timely fashion, no awardwould have accrued and, given the terms of s.2(2)(d) of the 1979 Act, none would have beenin prospect. Mrs Cameron was awarded and received £4,496 and the defendants receivedfull credit.

Commentary:The first issue to arise in this case has two parts—what is the proper level of award of

general damages for pain and suffering and loss of amenity in cases of mesothelioma, andwho is the final arbiter of that? The claimant cited the bracket from the JSB Guidelines, thedefendants cited a decision of Judge Walton in the county court,13 and someone (it is notclear who) cited the caution of David Foskett Q.C. (as he then was) in Worrall v PowergenPlc.14 What else was cited is unclear from the judgment. Two particular points were missed.Firstly, when writing the foreword to the current edition of the JSB Guidelines, Mr JusticeOwen said:

‘‘This small book since 1992 has been widely adopted as the starting point innegotiating levels of pain for general damages in personal injury cases. The aim ofthe book has remained to report on those awards made by the courts in Englandand Wales. In fact it is only in rare cases that courts make awards outside themargins reproduced in the guidelines. Anecdotal evidence suggests that this is alsothe case in negotiated settlements, although those amounts fall outside theremit of the text. . . .’’ [My emphasis]

12The conditions of entitlement are:a. that no payment under this act has been made to the deceased in respect of this disease;b. that death benefit is payable to or in respect of the dependant by reason of the deceased’s death as a result of the

disease, or that disablement benefit was payable to the deceased in respect of the disease immediately before hedied;

c. that every relevant employer of the deceased has ceased to carry on business; andd. that neither the deceased nor his personal representatives nor any relative of his has brought any action, or

compromised any claim, for damages in respect of the disablement or death.13Gallagher v Vintners Armstrong Ltd, January 17, 2007 [2007] Newcastle County Court where £20,000 was awarded to

the estate of a 79-year-old deceased who had described the onset of mild symptoms in mid June 2003, was still describedas ‘‘not unwell’’ in August 2003 but died on September 12, 2003, the judge approaching the case as one of six weeks ofillness.

14[1999] P.I.Q.R. Q103



Citing this with approval, Master Whitaker (as he then was), in charge of the mesotheliomalist at the Royal Courts of Justice, more recently said this in Smith v Bolton Copper Ltd:15

‘‘10. In my judgment, while this is only a guideline, as a bracket it is a very fairspread which is intended and, in my judgment, does take into account, allcases of mesothelioma, from those of the shortest duration to the longest,and is capable of taking account of varying levels of pain and varying levelsof medical procedure and surgical intervention. In my judgment, the bottomof the bracket is intended for people who contract the disease but who sufferonly the worst symptoms commonly suffered before death and the deathitself, and not a protracted period of gradually worsening symptoms beforehand.

11. The question which has been raised in this case is whether there can beexceptional cases which fall outside the guideline bracket and whether thiscase is one of them. . . . this bracket does not start at £0. It starts at about£49,000 now, as updated using Kemp. Can there be cases which could fallbelow that? I have no doubt . . . that there could be exceptional cases butwhat is meant by that?

13. So if there are exceptional cases, what could they be?. . ...it seems to me,for example, that a person who is run over by a bus within a week or two ofsuffering the early symptoms of mesothelioma would fall outside the bracket.As I say, mesothelioma victims typically suffer the worst symptoms in the lastfew weeks and sometimes the last few months of their illness. This is . . .

reflected, and always has been reflected, in the amount of and intensity ofcare predicted by the medics or the care experts in the last weeks or months,and there is no doubt . . . that the symptoms become much worse at thislater stage.

14. A typical victim with a survival from the onset of symptoms of 18 months will,for example, have suffered all the invasive procedures, the biopsies, et cetera,at perhaps an earlier stage and will not be, if I can put it in the vernacular,‘poked about’ so much during the very worst stages in the last few months,but what makes this type of case, a case of short duration, worse, in myjudgment, rather than one which is better (if one can put it that way) is thatthe two things get telescoped. This is a man who suffered the whole lot of theworst symptoms and medical procedures during a period of between two andthree months. Not only the worst symptoms, the final symptoms, the trauma,the pain, the bewilderment, the anxiety, the shock, as it has been described,of the diagnosis, but also has had to go through the procedures, the drainage,the biopsies, et cetera, during the very same period. It all happened extremelyquickly. That, in my judgment, is no reason for saying that the damages shouldfall outside the bracket. Far from it.

15. So it may well be that there are cases in which those final symptoms and thepainful mesothelioma related death (because I think one has to bear in mindof course that the damages have also got to take into account the fact thatthis is a painful and unpleasant death) do not occur, because the victim dies

15See the report in the Digest section of this edition of J.P.I.L.


CASE AND COMMENT

from something else, and therefore did not suffer them. That, in my judgment,might be said to be an exceptional case, . . .’’

In the case in question he awarded £55,000. Moreover, Smith L.J. in Rothwell v Chemical& Insulating Co Ltd16 acknowledged without demur that the usual award in a mesotheliomacase was £60,000 and her conclusions as to damages were agreed by the majority.17

Both Smith L.J. and Master Whitaker are correct. The table below represents an analysisof reported cases on damages for mesothelioma since Heil v Rankin.18 It suggests a numberof conclusions.

First, the proper bracket of award was considered by the Court of Appeal in Heil in whichthe fact that awards for mesothelioma had risen faster than RPI was noted and observed19

but still the Court of Appeal increased the awards in both of the mesothelioma cases beforeit, therefore implicitly approving the bracket of awards for that disease.

Secondly the bracket of awards as opposed to settlements reflected in the decidedcases is properly described by the JSB. Settlements in fact follow the same course. Thecorrectness of that bracket was reaffirmed implicitly by the Court of Appeal in Rothwell;

As Lord Woolf M.R. (as he then was) observed in Heil:

‘‘4. . . .. . ..levels of general damages for personal injury have traditionally beenregarded as more appropriate for final consideration by the Court of Appeal.We refer here to the well known statement of Lord Diplock in Wright v BritishRailways Board [1983] 2 AC 773 at p.785 A-B:

‘The Court of Appeal, with its considerable caseload of appeals inpersonal injury actions and the relatively recent experience of many ofits members in trying such cases themselves, is, generally speaking,the tribunal best qualified to set guidelines for judges currently tryingsuch actions, particularly as respects non-economic loss; and thisHouse should hesitate before deciding to depart from them, . . ..’

5. It is clear that Lord Diplock also intended the Court of Appeal to have theresponsibility for keeping guidelines up to date.’’

The writer submits that Holland J. and Judge Walton were seriously out of step in theawards they made.20 The correlation between award and duration of symptoms is at bestcrude. The reason is as described by Master Whitaker in Smith. There is not even crudecorrelation between age of claimant and award.

The second issue related to the proper approach to be taken to the fact that there had beenan award under the Pneumoconiosis Etc (Worker’s Compensation) Act 1979. It seems to methat while the end result of the decision was correct, the route to it may have been erroneous.

16[2006] EWCA Civ 27 (the so-called ‘‘pleural plaques cases’’) at [180], reflecting on submissions including those reportedat [174]

17Judgment of Lord Phillips L.C.J. at [104]18[2001] P.I.Q.R. Q319Judgment para.[80]20In fact Holland J. in Cameron implicitly so recognises because refrains from following Gallagher–see paras.[6] and [7]



Suppose, as is often the case, that it was the deceased primary victim who made theapplication and received the award during lifetime. A claim pursued by him to a conclusionduring his lifetime, or on behalf of his estate after his death would have been bound bythe result and reasoning of the Court of Appeal in Ballantine v Newalls Insulation Co Ltd.21

As such, in determining loss, credit would have to have been given for the award againstfinancial loss in the first instance, but in the event of an excess of award above financial loss,then also against the award of general damages for pain and suffering and loss of amenity.

The law treats the award as a payment in substitution for damages, because, although asa matter of policy and practice, the state does not seek to recover payments if claimantsgo on to recover damages, the awards are supposed only to be available in cases where noclaim has been made or appears to be viable against an extant employer or a solvent andidentified insurer.22 Such awards therefore are to replace in part damages that might havebeen awarded if available, thereby providing a safety net of last resort to those who sufferthis disease.

The problem that arises is that posthumous claims can be made and if successful, theyare paid as here, to the dependent of the deceased. However, the 1979 Act is silent asto what the payment is made in respect of. While the learned judge may have been rightto recognise that a posthumous claim was only available to dependents and appeared toresult from death,23 would it not have been simpler to hold that although the payment ismade to the dependents, it is made in respect of the deceased’s loss and suffering because,pursuant to s.2(2)(b) it is paid, ‘‘by reason of the deceased’s death as a result of the disease’’and that as such it is to be credited against the award to the estate under the Law Reform(Miscellaneous Provisions) Act 1934?

Alternatively, by the same reasoning, the court could have held that under s.3 of the FatalAccidents Act 1976, to the extent that a payment was made under the 1979 Act, therewas no loss, and that loss was limited to the extent to which awards under the 1976 Actexceeded the payment under the 1979 Act. No mention is made of s.3 of the 1976 Act inthe judgment. Instead, rather more artificially, Holland J. held that the payment should notfall to be disregarded simply because as a matter of the timetabling relationship betweenthe claim and the proceedings, the claimant got a payment that had the proceedings beenpursued earlier she would not have been entitled to and she would not have recovered.

It remains to be seen whether confusion about the interrelationship between claims fordamages in tort and claims for payments under the 1979 Act will be corrected by amendmentof the Child Maintenance and Other Payments Bill currently before Parliament, which extendsthe 1979 Act safety net to mesotheliomas which cannot be attributed to workplace exposureto asbestos.

Practice point: Always research and come to court equipped with comparable decisionsand not simply the ‘‘handy little volume’’ of JSB Guidelines whenever the court is to assessdamages for pain and suffering and loss of amenity.

Commentary by Allan Gore Q.C.

21[2000] P.I.Q.R. P327; [2001] I.C.R. 25 CA22See s.2(1) of the Act in respect of lifetime claims and 2(2) of the Act in respect of posthumous claims.23Judgment para.[17(a)].


CASE AND COMMENT

Table 1: List of claimants and awards/settlements

Claimant Status Judge Date Age Duration* Award UA Taylor decd Owen J. 26.01.01 53 4.5 years 65,000 79360G N/A JSB 8th edn 01.06.06 N/A 74,300 78193A Small decd Master

Whitaker11.01.05 52 15 months 67,000 74094

G Welch decd MasterNussey

22.02.07 32 12 months 70,000 71999

A Shanks alive HickinbottomH.H.J.

24.05.07 59 2.75 years 70,000 70917

A Butler decd MasterWhitaker

05.03.07 70 3 years 65,000 66431

G Rothwell N/A Court ofAppeal

26.01.06 N/A 60,000 64809

A Wilkins decd WilkinsonQ.C.

30.11.00 41 14 months 52,500 63726

A Rees decd Court ofAppeal

23.03.00 74 19 months 50,000 62025

A Faith decd Wade D.J. 16.09.02 80 ? months 52,500 61753A Hunt decd Bonvin H.H.J 14.04.00 59 13/14 mths 50,000 61405A Hunter decd Gray J. 14.08.00 75 18 months 50,000 61261A Fairchild decd Curtis J. 01.02.01 60 16 months 50,000 60727A Kelly decd Mackay J. 09.11.00 70 16 months 47,500 57657A Overton decd Master

Whitaker16.07.04 52 12 mths+ 51,000 57034

A Smith decd MasterWhitaker

10.07.07 ? 2 /3 mths 55,000 55747

A Dawber alive SwansonH.H.J.

16.02.02 44 over 2 yrs 45,000 54088

G N/A JSB 8th edn 01.06.06 N/A 47,850 50357A White alive Master Eyre 25.09.00 81 9 months 40,000 48666A Cameron decd Holland J. 12.10.07 5/6 mths 35,000 35000A Gallagher decd Walton

H.H.J.17.01.07 79 3 months 20,000 20724

S Thomas alive N/A 24.08.07 78 6 mths + 67,500 68021S Hatton alive N/A 24.08.07 58 18/24 mths 65,000 65502S White decd Nelson J. 11.01.02 58 @ a year? 52,500 63285S H Alive N/A 28.02.06 54 @ 2 years 57,000 61315S Edwards decd R’der Nolan

Q.C.02.10.02 76 14 months 47,500 55777

S Schofield decd Court ofAppeal

23.03.00 57 Unknown 44,000 54582

S Eaton decd Mackinnon J. 11.02.04 58 very short 45,000 51145S Mahmoud decd N/A 19.10.04 69 12 months 45,000 49844

A–Award: G–Guideline: S–agreed settlement.* where claimant alive duration is to anticipated date of deathU—updated to October 1, 2007



Garth v Grant & MIB, (Hickinbottom H.H.J), unreported elsewhere, May 25, 2007QBD

Damages—personal injury—road traffic accidents—provisional damages—medi-cal treatment—risk of deterioration after operation—multipliers—obesity—disabil-ity—Ogden Tables—meaning of disability—Supreme Court Act 1981 s.32a

Multiple injuries; Obesity; Ogden tables; Provisional damages; Road trafficaccidents

Vikki Garth was a passenger in a taxi when, as she was travelling along Bayswater Road,north of Hyde Park, a car driven by Lloyd Grant collided with it. She was injured andclaimed damages. Grant was on the wrong side of the road when the collision occurred andliability was admitted. Lloyd Grant was uninsured and the MIB were joined. A deduction of15 per cent was agreed because Vikki Garth’s injuries were made worse by the fact that shewas not wearing a seatbelt when the impact occurred.

Ms Garth suffered multiple injuries including an open book fracture to her pelvis, with anassociated hip dislocation and fracture. Following surgery she was able to walk, but only witha crutch, with difficulty and only for short distances. She was given the option to have a hipreplacement that, it was expected, would substantially improve her mobility.

There were problems. Ms Garth was born in the USA on April 30, 1959. At the time ofthe accident, Vikki Garth weighed 28–30 stones and was medically super-morbidly obese(i.e. with a body mass index of over 50). She accepted in her evidence that she had had ‘‘along and tortuous fight against obesity’’ since the age of nine years, when she went to WeightWatchers in the US. To enable the operation to take place and to optimise the chances ofsuccess she had to lose a substantial amount of weight.

There was also a 20 per cent chance that, after the operation, she would be in the same,if not worse position due to contracting an infection or palsy, than she was prior to theoperation.

Garth sought an award of provisional damages on the basis that if she suffered either a palsyor an infection, that condition would cause her to be functionally worse off than she wasprior to the operation and she should be able to seek further damages if that occurred.

The MIB argued that, even before her accident, by virtue of her morbid obesity, she was‘‘disabled’’ and when calculating her damages the appropriate multiplier should be reducedon the basis of the approach set out in the Ogden tables version 6.

Dealing with the provisional damages point, the judge held that the essential requirements24

were not met. This was simply because if Vikki Garth suffered either a palsy or infection, itwould not be her condition that would deteriorate; it would be her prognosis. In addition tothe extent that a palsy might make her overall condition worse, the expert evidence did notshow that it would represent a serious deterioration.

The judge accepted that an infection and even a palsy might fall within the definition of‘‘disease’’ for the purposes of s.32A, because Garth had pleaded her claim solely on the basisof a serious deterioration that did not assist her. He also held that the principle of finalityoverrode the fact that there was likely to be and sometimes would inevitably be, some overand under-compensation, dependent upon whether risks materialised or not. This being so itwas therefore held to be appropriate to proceed with quantum under most heads on the basisthat the hip operation was successful.

24Under the Supreme Court Act 1981 s.32A.


CASE AND COMMENT

Judge Hickinbottom felt that it was appropriate to take the most serious injury to the pelvisand hips under the JSB guidelines as the starting point and then consider other factors. Thoseincluded:

• operations already carried out to Garth’s hip joint;• a post-operative infection suffered;• stress incontinence caused, which was likely to be permanent;• mobility problems; and• the 20 per cent chance that her condition might not improve as a result of the operation

and that it might get worse.

In the circumstances, he held that it was appropriate to award £66,000 for pain, sufferingand loss of amenity.

Turning to the multiplier, the judge held on the evidence, that it was impossible to say thatVikki Garth’s weight had a ‘‘substantial adverse effect on her ability to carry out day-to-dayactivities’’ as required by the Ogden tables to satisfy the criteria of being a disabled person.In addition, it appeared to have had no significant adverse impact on the kind or amountof work she wished to do and did. That meant she was not ‘‘disabled’’ in accordance withthe Ogden table definition and the appropriate factor to reflect contingencies other thanmortality was 0.87 not 0.6 as contended for by the MIB.

Commentary: The two key requirements for an award of provisional damages are that itmust be shown that the claimant will at some time either (1) develop some serious diseaseor (2) suffer some serious deterioration in physical or mental condition.

In this case, the claimant’s concern in this respect was that she would inevitably needrevision surgery for her damaged pelvis, as is commonly the case for individuals who suffersuch trauma, even when they are of normal weight. That revision surgery carries with it thewell-known risk of sciatic nerve palsy and infection, more so in an obese individual.

What was put to the court as the proposition that these risks would cause her to befunctionally worse off than she was pre-operatively. In other words, there was a risk thatthe potential complications of surgery would cause a serious deterioration in her condition,which merited a provisional damages award. The trial judge assessed the risk of suchcomplications developing as 20 per cent.

But on the evidence before the court, those risks were that she would be ‘‘somewhatworse off’’, in that they would probably manifest themselves as a dropped foot, chronic painand functional deficit. Were an infection to develop she would need further surgery to removethe implants, but she would achieve current functionality within two years.

There was no suggestion that the claimant would have been compromised anywaybecause of her obesity, nor was a case advanced that she should be entitled to, or denied,compensation because of her pre-existing super-morbid obesity. The judge simply found asa matter of fact that the potential complications were not of sufficient severity to amountto a serious deterioration for the purposes of the second limb of the test set out in s.32A.The case was only brought in that respect, and the judge noted that an infection or nerveinjury might fall within the definition of disease for the purposes of the first limb of the test ins.32A. Whether in this case either complication would have achieved the relevant degree ofseriousness is debatable. Accordingly, the judge made a final award.

On the face of it, this is simply an evidential finding by a judge on the expert testimonybefore him. It may seem harsh, although the range of disability caused by sciatic nerve



damage, foot drop or surgical site infection is wide. While it might be surprising thata super-morbidly obese individual might suffer more serious physiological and functionalcomplications. In this particular case, the judge relied on his findings on the evidence hehad. It is certainly clear from the judgement that Ms Garth was a sturdy individual who hadno personal issue with her weight, seeing it more a problem of perception in others.

For many others who suffer obesity it can be a highly disabling condition, where evenan otherwise minor complication such as sciatic nerve damage can have a functionallydisastrous consequence.

But if Ms Garth perhaps paid a price for coping admirably with what others might see as adisability, the judge recognised this in rejecting the case advanced by the defendant, whichwould otherwise have seen a greater discount applied to her damages.

The normal discount to have applied for contingencies other than mortality, as per theOgden tables (6th edn, May 2007) would have been 0.87. The defendant contended for 0.6to reflect the fact that the claimant’s obesity amounted to a disability. In fact, the only reasonreported by the Judge was that Ms Garth could not wear a seat belt because of her weight,and this amounted to a functional deficit, and consequently a disability.

The Ogden tables define a disabled person as one whom:

(i) Has a progressive illness or an illness which has lasted or is expected to last for over ayear.

(ii) Satisfies the Disability Discrimination Act definition that the impact of the disabilitysubstantially limits the person’s ability to carry out normal day-to-day activities. It shouldhave a substantial adverse effect on the ability to carry out such activities.

(iii) Has a condition which affects either the kind or the amount of paid work they cando.

What the judge made clear is that not every functional deficit requires the deduction inrespect of disablement. As a matter of fact he found that even if Ms Garth did have a relevantillness, it did not adversely affect her ability to work or do the kind of work she wanted to.There was no inconsistency with the substantial award for loss of earnings. The judge wasclearly impressed by the fact that pre-accident she did not consider her weight restrictedher activities or her ability to do her job and found that ‘‘she was not significantly functionallydisabled by her weight’’. He then found that but for the accident, rather than as a result ofany disability, she would have had a better paid job which she had to relinquish.

Again, much of this seems to come down to the strength of personality of the claimantin this case. However, as above, there will be many cases where an obese individual isdisabled. Given the impact that obesity has on life choices, as well as life expectancy, it ishighly likely that this sort of argument will be advanced in future cases.

Practice points:

• Practitioners should consider whether a potential complication can be developed underboth limbs of the test in s.32A but perhaps more importantly, any expert consideringfuture consequences should be specifically directed to the question of seriousness,both of a deterioration and of a disease.

• Although in this case the judge rejected the assertion that a higher discount should beapplied, this was fact-specific and defendants should consider carefully the evidence


CASE AND COMMENT

they may need in the form of medical records or employment history in demonstratingthat an obese individual is disabled for the purposes of a discount.

Commentary by Simon Lindsay

Whipps Cross University NHS Trust v Iqbal (Laws, Gage and Rimer L.J.J.),November 20, 2007, [2007] EWCA Civ 1190, CA (Civ Div)

Personal injury—clinical negligence—birth trauma—quantum—loss of earn-ings—child claimant—loss of expectation of life—lost years earnings

Birth defects; Causation; Clinical negligence; Loss of earnings; Measure ofdamages; Personal injury; Precedent

Khazar Iqbal suffered brain damage at the time of his birth in the defendant’s hospital. Theresult was that he suffered from dystonic tetraplegic cerebral palsy and cognitive disability.Liability was not in dispute.

At first instance Sir Rodger Bell assessed damages and made rulings on some importanttopics fully reported in the Case and Comment section of the September 2007 edition ofJ.P.I.L.

The judge held that the child (then aged 9.5 years) had a lost years claim at a rate of £6,667per annum between the ages of 41 and 65, the latter being a notional retirement date. Thatsum represented one-third of his agreed net earnings.25

Sir Rodger decided that there was an anomaly between the Court of Appeal decision inCroke (A Minor) v Wiseman [1982] 1 W.L.R. 71 and the House of Lords decision in Pickettv British Rail Engineering Ltd [1980] A.C. 136, concerning infant claimants with curtailedlife expectancies who will have no dependants and circumstances concerning adult claimantswith curtailed life expectancies who were also unlikely to have dependants.

His view was that as loss of earnings could be measured using actuarial science, the sameprinciples could be used to look many years distant at anticipated life even where there wereno dependants. Additional uncertainty could be allowed for in the calculation, but should notprevent the calculation from being made. The judge awarded Khazar the sum of £42,402,calculated by a multiplier of 6.36 applied to a multiplicand of £6,667, which representedone-third of the agreed net earnings of £20,000. This aspect of the first instance decision wasappealed.

The Court of Appeal held that Pickett did not restrict a claim for lost years to adults with orwithout dependants. They pointed out that there were references in Pickett to the difficulty ofproving future loss of earnings for a young child in the context of a lost years claim but theyrecognised that Pickett did not rule out such a claim. They confirmed that Pickett establishedthe principle that damages for lost years could include compensation for loss of earnings inthat period whatever the age of the claimant.

Having held that in Pickett, the House of Lords specifically had not restricted claims for thelost years to those who had dependants or who might use their earnings for other purposes.They went on to point out that those conclusions were reinforced by the Lords in Gammell

25Croke (A Minor) v Wiseman [1982] 1 W.L.R. 71 distinguished and Pickett v British Rail Engineering Ltd [1980] A.C. 136applied.



v Wilson [1982] A.C. 27. They concluded that this meant that the decision in Croke was notconsistent with the decisions of the House of Lords in Pickett and Gammell.

Turning to this case they noted that Sir Rodger Bell held that he was not bound by thedecision in Croke on the basis that it was made on practical grounds nearly 25 years agowhich did not apply today as actuarial science had moved on. However they concludedthat such reasoning was not capable of distinguishing Croke from Khazar Iqbal’s case. Theypointed out that Croke was decided after the court had been referred to both Pickett andGammell. Although the decision was inconsistent with both Pickett and Gammell they werenot prepared to hold that the circumstances in this case were so rare and exceptional that thecourt was not entitled to follow it.

In a nutshell, they decided that any error in Croke had to be corrected by the House ofLords. Accordingly, Sir Rodger Bell was in error in not regarding Croke as requiring him toreject the lost years claim. Stare decisis26 applied. The Court of Appeal followed Croke and theappeal was allowed.

Commentary: The doctrine of precedent, or stare decisis, must reflect the hierarchy ofthe courts. With this in mind the legal wit Theo Mathew once observed:

‘‘The duty of the judge at first instance is to be quick, courteous and wrong.However, that is not to say that the duty of the Court of Appeal is to be slow, rudeand right, for that would be to usurp the function of the House of Lords.’’

The judgment in this case suggests that hierarchy, underpinning the system of precedentso essential to a coherent common law jurisdiction, remains important. There is inevitably atension, in any system based on precedent, between the certainty such a system affords andthe need for justice in an individual case. Courts can, of course, distinguish earlier decisions,where appropriate, but where the point of law is clear, precedent will usually hold sway.

Traditionally the Law Lords were bound by their own previous decisions though followingthe Practice Note (Judicial Precedent) [1966] 3 All E.R. 77 they became entitled to overrulea previous decision of the House.

The Court of Appeal, as well as being bound by decisions of the House of Lords, is, at leastin the civil division, bound by its own earlier decisions subject to the exceptions identified inYoung-v Bristol Aeroplane Co Ltd [1944] K.B. 718. These are:

• The earlier decision was expressly or impliedly overruled by a subsequent decision ofthe House of Lords.

• If the earlier decision was inconsistent with a yet earlier decision of the Court ofAppeal.

• If the earlier decision was reached per incuriam (in other words without the Courthaving been referred to a relevant authority).

In Law Reporting and the Doctrine of Precedent, one of the Halsbury’s Laws of EnglandCentenary Essays, Lord Neuberger recently reflected that adherence to the strict principlesin Young might be weakening, noting that in a number of recent decisions the Court ofAppeal refused to follow an earlier decision simply because the reasoning in the earlier casewas ‘‘fallacious’’, for e.g. Wellcome Trust Ltd v Hamad [1998] QB 638.

26‘‘To stand by that which is decided.’’ The principal that precedent decisions are to be followed by the courts.


CASE AND COMMENT

This led Lord Neuberger to speculate that there was almost a fourth category to be addedto Young; that the Court of Appeal was no longer bound by a decision it thought wrong.Indeed, even first instance judges were thought to be ‘‘rather less impressed than they usedto be by the force of the rules of comity’’.

What if the earlier decision of the Court of Appeal is inconsistent with a yet earlier decisionof the House of Lords? The first exception in Young only relates to a subsequent decision ofthe House. The second exception concerns only earlier decisions of the Court of Appeal. Thethird exception is not available if the earlier decision of the House of Lords has been citedbut, in the view of the subsequent division of the Court of Appeal, been misunderstood ormisapplied. Can such a decision fall within the fourth category identified by Lord Neubergerand not be followed because it is ‘‘wrong’’?

Here the court had to deal with that very situation, hence the decision both illustrates andtests some of the theories considered by Lord Neuberger.

At first instance the judge, recognising the decision in Croke did not sit well with previousHouse of Lords decisions, rather boldly declined to follow what, at face value, appearedto be a binding Court of Appeal authority. This, perhaps reflecting the suspicions of LordNeuberger about the approach of judges at first instance, was partly on the basis of thetime that had elapsed since the judgment was given (though it was important that meanwhilethe Ogden tables had been introduced facilitating calculations of the kind thought difficult aquarter of a century ago).

On appeal, returning for a moment to Mathew’s maxim, it might be said the question waswhether the trial judge was fulfilling his duty to be ‘‘wrong’’.

The Court of Appeal, after carefully reviewing the authorities, concluded the decision inCroke was not consistent with the earlier decisions of the House of Lords in Pickett andGammell. That meant the court then had to consider whether it, and the trial judge, werenonetheless faced with a binding precedent. This had to be determined by consideringwhether any of the exceptions to the doctrine of stare decisis, as described in Young andsubsequent cases, applied.

• The court did not accept the argument that the decision in Croke was impliedlyoverruled by the subsequent House of Lords decision in Wells v Wells [1999] A.C.345, as that concerned solely the assessment of damages to which the claimant wasentitled.

• There was no earlier decision of the Court of Appeal with which Croke was inconsistent.This exception was held not to apply to an earlier decision of the House of Lords,unless per incuriam. That was because if the first Court of Appeal had considered theearlier House of Lords decision, and either wrongly distinguished it or misinterpretedits effect, the second Court of Appeal would be simply disagreeing with the reasoningof the first Court of Appeal, which the doctrine of stare decisis forbids.

• It could not be said the decision in Croke was per incuriam as the court in that casehad been referred to both Pickett and Gammell.

• Although there were cases that suggested the court should not follow an earlierdecision which was ‘‘manifestly wrong’’, the decision in Croke, although inconsistentwith earlier House of Lords authority, was held not to fall within this category.

• The proper course was to give the claimant leave to appeal to the House of Lordsfor any earlier error by the Court of Appeal to be corrected, despite the claimant’s



arguments that this approach was hardly consistent with the overriding objective foundin Pt 1 of the CPR.

Accordingly, although essentially accepting the trial judge had correctly identified the errorin Croke, his decision, on the basis of precedent, was indeed held to be wrong.

The irony of all this is that although there is House of Lords authority, in support of theclaimant’s contention, this pre-dates, rather than post-dates, the relevant Court of Appealdecision. Provided, as it was in this case, that earlier House of Lords authority was consideredby the Court of Appeal, it would seem none of the exceptions in Young or subsequent caseswill apply. The doctrine of precedent means such a decision, though it may be wrong, willstand and bind not only first instance judges but also the Court of Appeal.

The outcome, decided as it was on the basis of precedent rather than first principles,whilst preserving certainty may not deliver justice. Despite the grant of permission to appealto the House of Lords, there may be a host of reasons why the issues will not be aired atthat level, a point argued forcefully in the present case.

Perhaps the Court of Appeal should have decided to be ‘‘right’’ at the risk of usurping thefunction of the House of Lords. It would seem, however, there is more than a grain of truthin Mathew’s aphorism concerning the hierarchy of the courts.

Had the court considered the correct principles to be applied, rather than deciding thecase on the basis of precedent, the issues concerning a claim for lost years by a young childcould have been fully explored. Whilst, in this case, the trial judge took the view there wasno principle which prevented award of damages for such a claim. A contrary view was takenby another judge at first instance in Lewis v Royal Shrewsbury Hospital NHS Trust January29, 2007, [2007], (QBD).

The judge in Lewis, H.H. Judge MacDuff Q.C., wrote in the September 2007 edition ofJ.P.I.L. (p.242 about the development of this area of law from Pickett, in which he wasjunior counsel, up to and including his role as trial judge in Lewis.) That article explained therationale for the decision rejecting a lost years claim, which was not the difficulty of makinga calculation for this head of damage but because damages are meant to be compensatory.Hence where there were no, and never would be, any dependents an award for lost futureearnings during the period, the claimant would not survive was held to be a fund that wouldend up simply as a windfall for the claimant’s estate. It was considered wrong for the Courtto compensate for a potential loss, which would not, in fact, ever be suffered.

In the event, by reaching a decision essentially on the basis of precedent, the Court ofAppeal avoided the opportunity of determining which of two forceful and cogent first instancedecisions correctly approached this difficult issue.

Practice points:• If faced with a Court of Appeal decision that appears to be wrong, even if there is an

earlier House of Lords decision in support, be prepared to go to the Law Lords!• For the time being it would not seem possible to pursue a lost years claim for a young

child.• However, as Gammell illustrates, such a claim, if it can be proved on a balance of

probabilities, can be pursued for an adolescent.• The decision in Wells should be a prism through which cases on assessment of

damages are viewed, to ensure the ‘‘100% principle’’ prevails, but the decisioncannot be used to support, of itself, a head of claim against which there is bindingauthority.


CASE AND COMMENT

• The appeal in this case concerned only the lost years claim so all otheraspects of the helpful and detailed first instance judgment dealing with awide range of issues on quantum (see [2007] J.P.I.L. C126) remain goodlaw.

Commentary by John McQuater

Procedure

O’Byrne v Aventis Pasteur SA (Arden and Moore-Bick L.JJ. and Sir AnthonyClarke M.R.), October 9, 2007, [2007], EWCA Civ 939 CA

Personal Injury—product liability—procedure—limitation periods—substitution ofparties—mistake—substitution after expiry of limitation period—necessity—mis-nomer—sections 11a(3), 35(5) and 35(6) of the Limitation Act—Directive 85/374 onLiability for Defective Products 1985

Defective products; Liability insurance; Personal injury; Personal injuryclaims; Product liability

The infant claimant Declan O’Byrne suffered brain damage following a vaccination whenhe was a year old in 1992. His case was that the vaccine was defective and the cause of thebrain damage. On November 1, 2000 proceedings were commenced against Aventis PasteurSA (APMSD), a company believed by his solicitors to be the manufacturer or producer ofthe vaccine. That belief was mistaken and subsequently the claimant obtained an order tosubstitute Aventis Pasteur SA (APSA) for APMSD on the basis that that company was themanufacturer or producer of the vaccine.

Under the Consumer Protection Act 1987 a claimant has 10 years from the date on whichthe vaccine is put into circulation, to bring a claim under the Act. That 10-year periodexpired at the latest on November 3, 2002. The researches of APSA suggested that thevaccine was put into circulation on September 22, 1992. If that was correct then the 10-yearperiod expired on September 22, 2002. The application to substitute was issued on March10, 2003 after the 10-year period had expired.

In November 2003 two questions in the proceedings had been put to the European Courtof Justice (ECJ) for a preliminary ruling under Art.234 EC.27 One question was, in essence,whether the Council Directive of 1985 (85/374) concerning product liability, permitted thecourts of a Member State to allow a party to be substituted for another party in circumstanceswhere a claim for product liability had been commenced against the original party within the10-year period allowed by Art.11 of the Directive but the application to substitute had notbeen made until after the expiry of that 10-year period.

The ECJ gave its ruling on February 9, 2006,28 holding that it is for national procedurallaw to determine whether and under what conditions it is permissible for the substitution ofa party where a mistake of the kind under consideration has been made.

27Council Directive 85/374/EEC of July 25, 1985 on the approximation of the laws, regulations and administrativeprovisions of the Member States concerning liability for defective products.

28Case C-127/04



In October 2006 on an application by the claimant, Teare J. ordered that APSA besubstituted for APMSD as the defendant in the action as the original defendant had been suedby mistake. The order was made under s.35 of the Limitation Act 1980.

The defendant appealed. The appeal had to consider whether s.35 is applicable where thetime limit which has expired is the 10-year final cut-off date for enforcing rights pursuant toEuropean Directive 85/374/EEC.

The court held that the mistake must be of name and not a mistake of identity ascontemplated by s.35(6) of the 1980 Act. The case of Horne-Roberts v SmithKline Beecham Plc[2001] EWCA Civ 2006, holding that the Limitation Act 1980 s.35 was capable of applyingwhere the 10-year period in Directive 85/374 Art.11 had expired was confirmed as correctlydecided.

The court held that where the new party was to be substituted for a party whose name hadbeen given in a claim in the original action by mistake for the new party’s name, substitutionwas to be regarded as necessary for the determination of the original action for the purposesof s.35. The substitution was accordingly necessary for determining the original action withins.35(5) and (6) and the appeal was dismissed.

Commentary: This case adds to the trickle of decisions on strict liability for damagecaused by products under the Product Liability Directive 1985 and the Consumer ProtectionAct 1987 Pt I and the stream of decisions on substitution of parties under CPR 19.5.

The underlying facts are simple enough: the child claimant’s solicitors sued the wrong drugcompany. It responded that it was a supplier but not the producer of the vaccine concerned.The claimant applied to substitute the right company as defendant but, by the time it did so,the 10-year cut-off date had passed.29

The Court of Appeal had decided in Horne-Roberts v SmithKline Becham Plc that the10-year period under the Directive is a time limit for the purpose of the Limitation Act1980 s.35.30 Thus a new claim substituting a new party for an original party may be madeoutside the time limit where the substitution is made to correct an error in the name of theoriginal party and the claim in the original action cannot otherwise be maintained without thesubstitution.

The parties sought a reference to the ECJ. The primary point was definition of the meaningof the phrase ‘‘put into circulation’’ in the context of intra-group transfers. The court decidedthat a product is put into circulation when it leaves the production process operated by theproducer and enters a marketing process in the form in which it is offered to the public.31

The court was also asked to decide whether a Member State had a discretionary powerunder Art.11 of the Directive, to allow substitution after expiry of the 10-year limit. Thecourt’s decision was, rather predictably, that this was a question for the procedural law ofthe Member State, subject to the constraint that liability under the Directive is confined to anarrow class of defendants.32 Thus the defendants argued that substitution should only be

29Art.11 of the Directive: the rights [to sue] shall be extinguished on expiry of a period of 10 years from the date onwhich the producer put into circulation the actual product which caused the damage, unless the injured person has inthe meantime instituted proceedings against the producer. This is implemented into domestic law by s.11A (3) of theLimitation Act 1980 (the 1980 Act).

30[2001] EWCA Civ 2006; [2002] 1 W.L.R. 1662.31Case C-127/04.32Producer, importer, own-brander and, subject to strict conditions, an intermediate supplier. Thus substitution after the

expiry of the 10-year limit must be exercised with caution.


CASE AND COMMENT

allowed where a claim had been made in time against a producer (albeit in the wrong name).The Court of Appeal pointed out that, whilst that submission had also been made to the ECJby the Commission and the Advocate General, there was absolutely nothing in the judgmentof the Court of Justice to lead to the conclusion that the submission had been accepted.

Teare J. had been bound by Horne-Roberts to allow substitution so the defendants soughton appeal to persuade the Court of Appeal that the earlier case had been wrongly decided.The defendants tried unsuccessfully to disregard Horne-Roberts on the basis that it couldnot stand with the decision of the ECJ, by analogy with the principle that a case should notbe followed that, whilst not expressly overruled, cannot stand with a decision of the House ofLords. The Court of Appeal had no difficulty in finding that Horne-Roberts was consistent withthe decision of the ECJ in the instant case and that it was rightly decided. Parliament haddescribed the 10-year limit as a time limit in s.11A(3) of the 1980 Act and it was reasonableto assume that it must have also intended it to be a time limit for the purpose of s.35 of the1980 Act.

The second issue raised on the appeal was whether substitution should be allowed whereat the date of expiry of the 10-year period, the claimant was no longer under any mistake asto the correct name of the defendant. The reasoning of the judge was accepted: the diligentclaimant who had discovered the right name by the cut-off date would be worse off than thenegligent claimant who had not even tried to find out the correct name.

Finally the Court of Appeal agreed with the judge that substitution was necessary for thepurpose of s.35(6) of the 1980 Act when there was a mistake as to the name of the intendedparty in the original claim.

The usual approach of English courts that the mistake must be as to the name, not theidentity of the proposed defendant, is easy to justify on common sense grounds althoughthere may be times when the distinction between the two is hard to maintain. Claimant’sadvisers will be sensible to think and speak of the proposed defendant by function: ‘‘we aregoing to sue the producer of the vaccine’’ rather than ‘‘we are going to claim against X Co’’.

Practice points:

• Interrogate the proposed defendant and its advisers, do due diligence where possibleand describe the intended defendant by function.

• Remember the 10-year period runs through childhood and disability and starts whenthe producer, importer or own brander first put the particular product into circulation(even when you are suing a supplier because you cannot identify one of those three).

• Since that date may well be uncertain, err on the side of caution and issue early.

Commentary by Mark Mildred

Hoddinott v Persimmon Homes (Wessex) Ltd (Sir Anthony Clarke M.R., Dysonand Jacob L.JJ.), November 21, 2007, [2007] EWCA Civ 1203, CA (Civ Div)

Civil procedure—claim forms—service—applications without notice—extensionsof time for service—failure to dispute court’s jurisdiction—setting aside withoutnotice orders extending time for service of claim form—CPR r.7.6(1) and r.11

Claim forms; Extensions of time; Forms; Notices; Service



The subject matter of the litigation in this case is of no general relevance and for proceduralpurposes can be ignored. What matters is that the claimants issued a claim form claimingdamages from Persimmon Homes (Wessex) Ltd. When issued, particulars of claim were notattached to the claim form. Before the expiry of the four-month period for service of theclaim form, the claimants applied without notice and obtained an order from a district judgegranting a two-month extension of time to permit the claim to be fully particularised. It wassuggested that this would promote the chances of the claim being settled.

The claimants then sent a copy of the claim form to the defendants for information only.The defendants applied to set aside the extension of time on the ground that there had beenno good reason for it. The claim form and particulars were then served. The defendants filedan acknowledgment of service indicating that it intended to defend the claim but not tocontest the jurisdiction.

Then a different district judge set aside the order extending time and held that thedefendants did not have to make an application under CPR r.1133 since it had made anapplication disputing service before the proceedings had been served. Persimmon Homessubmitted that CPR r.11 had no relevance in the context; alternatively that the applicationto set aside the order extending time for service rendered an application under CPR r.11unnecessary.

The claimants appealed and submitted that in exercising his discretion the judge shouldhave taken into account the fact that the without notice order extending time had giventhem a false sense of security because they thought they could safely serve the claim formwithin the extended period. They argued that the claim was not statute-barred and that delayhad not caused any prejudice to Persimmon Homes, which had been sent a copy of the claimform for information.

The Court of Appeal held that CPR r.1134 did matter. The word ‘‘jurisdiction’’ was usedin two different senses in the CPR: one meaning was territorial jurisdiction, but in CPRr.11(1) the word did not denote territorial jurisdiction but the court’s power or authority totry a claim. In addition, they held that even if the court had jurisdiction to try a claim wherethe claim form had not been served in time, it was open to a defendant to argue that thecourt should not exercise its jurisdiction to do so and CPR r.11(1)(b) was engaged in such acase. Crucially they held that the application to set aside the order extending time for servicedid not mean that an application under CPR r.11 was unnecessary.

CPR r.11(2) requires that if the defendant wishes to make an application to challengejurisdiction under subs.1, they must first file an acknowledgment of service in accordancewith Pt 10. CPR r.11(5) then states that if the defendant files an acknowledgment of service;and does not make an application within the period for filing a defence, they are to be treated

33This deals with the procedure for disputing the court’s jurisdiction.34

(1) A defendant who wishes to–(a) dispute the court’s jurisdiction to try the claim; or(b) argue that the court should not exercise its jurisdiction, may apply to the court for an order declaring

that it has no such jurisdiction or should not exercise any jurisdiction which it may have.(2) A defendant who wishes to make such an application must file an acknowledgment of service.A defendant who

files an acknowledgment of service does not, by doing so, lose any right that they may have to dispute the court’sjurisdiction.

(3) An application under this rule must–(a) be made within 14 days after serving an acknowledgment of service; and(b) be supported by evidence.

(4) If the defendant–(a) files an acknowledgment of service; and(b) does not make such an application within the period specified in para.(4), they are to be treated as

having accepted that the court has jurisdiction to try the claim.


CASE AND COMMENT

as having accepted that the court has jurisdiction to try the claim. The Court of Appeal heldthat the meaning of CPR r.11(5) is clear and unqualified, meaning that if the defendant filesan acknowledgment of service and does not make an application within the period specifiedthey have to be treated as having accepted that the court has jurisdiction.

As far as they were concerned there was no warrant for holding that, if an application wasmade before the filing of an acknowledgment of service to set aside an order extending thetime for service, that had the effect of disapplying the requirement for an application underCPR r.11(1).

CPR r.11(3) states that a defendant who files an acknowledgment of service does not, bydoing so, lose any right that they may have to dispute the court’s jurisdiction. The Court ofAppeal concluded that this reference to disputing the court’s jurisdiction and accepting thatthe court had jurisdiction in CPR r.11(5) encompassed both limbs of CPR r.11(1). In essencethe reference to the court’s jurisdiction was shorthand for both the court’s jurisdiction to trythe claim and the court’s exercise of its jurisdiction to try the claim.

Accordingly, the effect of CPR r.11(5) was that the defendant had been treated as havingabandoned its application to set aside the order extending the time for service. That conclusionwas reinforced by the fact that it indicated on the acknowledgment of service that it did notintend to contest jurisdiction.

Looking at this particular case, the court came to the conclusion that there was in fact nogood reason for the claimants’ failure to serve the claim form within the four-month period.The sense of security they had gained from the without notice order was false and it was nota relevant factor to be taken into account under CPR r.7.6(1), which permits the claimantto apply for an order extending the period within which the claim form may be served.The court made it clear that if a claimant obtains an extension of time without notice to thedefendant, they do so at their peril. However this claim was not statute-barred and that wasa relevant consideration.

Although they had held that there was no good reason for the failure to serve in time, theyconcluded that the unusual combination of the facts that the claim was not statute-barred andthat a copy of the claim form had been sent to the defendant within the four-month periodled to the conclusion that the order extending time should not have been set aside.

In the end the appeal was allowed for two reasons. First because of CPR r.11(5), thedefendant was treated as having accepted that the court should deal with the claim even if theextension should never have been granted in the first place and secondly because the districtjudge should not have set aside the extension of time for service.

Commentary:The Court of Appeal yet again had to deal with an issue relating to the harsh effect of

the rules relating to service in the CPR, although there is a weary note to the judgment thatsuggests that they find it difficult to believe that can be another issue which remains to bedecided after the plethora of decisions in the last few years.

This case arose out of dispute between a farmer and a builder. The builder entered thefarmer’s land by agreement to construct a sewer but then allegedly failed to reinstate theland.

A claim form was issued on May 22, 2006 but despite all the warnings given bycommentators on the service rules (including in this Journal), that it is risky to take chanceswith service, it was not served. Time for service expired on September 22, 2006.

It is well established that any application to extend time must be made within the timefor service and so on September 13, 2006 the claimant’s solicitor applied ex parte for an



extension of time to serve. The reasons given for the application were inter alia that theclaimant was not in a position to fully quantify the loss and indeed it appears that a detailedletter of claim had not yet been sent to the defendants. It is not entirely clear from thejudgment why the expert had not been instructed in time to provide the necessary informationbut reasons for this were given to the court. The judge accordingly granted the applicationand time was extended to November 22, 2006.

The claimant’s solicitor sent a copy of the claim form to the defendant for ‘‘informationpurposes only’’ on September 14, 2006 and followed this with a copy of the expert’sfinal report on September 20. The defendants made an application to set aside the orderextending time on October 2 on the basis that the claimant did not have a good reason fortheir application.

The claimant’s solicitor served the proceedings on November 21 (just within the extendedtime) and the defendant’s solicitors filed an acknowledgement of service on November 28.Although they ticked the box marked ‘‘I intend to defend all of this claim’’, they did not tickthe box marked ‘‘I intend to contest jurisdiction’’.

The district judge who dealt with the defendant’s application first considered the originalapplication made by the claimant to extend time for service and was unimpressed by thereasons given by the claimant. He was clearly of the view that the claimant had had plentyof time already and in any event had the option of serving the claim form and applying toextend time for service of the particulars of claim (where the rules are more forgiving). Hedid not think that the fact that the claimant argued that the case was not yet time-barred wasa sufficient reason.

He was also unconvinced by the arguments of the claimant that the defendants had notcomplied with CPR 11.35 The claimant therefore argued that as the defendant had completedthe acknowledgment form without ticking the box contesting jurisdiction, he was not thenable to rely upon his application.

The judge found this to be ridiculous when the defendant had made the applicationdisputing the service position even before they had been formally served.

He was not swayed by the claimant having a false sense of security because of theexistence of an order extending service. Any claimant in this position should be aware thathe was running a risk in relying upon an order obtained ex parte.

The claimants appealed to the Court of Appeal. Dyson L.J. gave the judgment of aheavyweight court. The court first had to decide whether r.11 applied at all. The defendantsargued that ‘‘jurisdiction’’ in this rule had the meaning given elsewhere in the rules, i.e.territorial jurisdiction. The Court of Appeal did not accept this and found that the meaning ofjurisdiction in this context was the court’s power to try the claim and that therefore r.11 wasengaged.

The Court of Appeal then had to consider whether r.11 had to be strictly complied with bythe defendants as they had already made an application to set aside the order extending thetime for service.

They found that the rule was clear and unambiguous. The procedure for challengingjurisdiction or for asking the court not to exercise its jurisdiction was that the defendant hadto file an acknowledgment of service and then make an application within 14 days. If he didnot he would be treated as having accepted that the court had jurisdiction. An application

35See the previous footnote.


CASE AND COMMENT

made before the filing of an acknowledgment of service (as in this case) would not suffice.They therefore found for the claimant.

Despite finding for the claimant, the court went on to consider whether the district judgehad exercised his discretion properly under CPR 7.6.

This gave the court the opportunity to revisit the decisions on applying discretion and inparticular the cases of Hashtroodi v Hancock, Leeson v Marsden and Glass v Surrendran.They noted with approval that in all of these, the court had taken a very strict line on theimportance of complying with the rules on service and the reluctance of the court to allow theinefficient claimant solicitor any escape from the harsh consequences of failing to observethe rules.

They also dealt with the point raised about the claimant having a ‘‘false sense of security’’because the court had granted the ex parte application to extend service. The district judgehad held that this was irrelevant but there was some conflict with the case of Jones v Wrekinwhich was a pre-CPR case. In that case, Lord Woolf and Walker L.J. found that a claimant whohad obtained three ex parte extensions of time to serve proceedings had acted reasonably,but both made it clear that this was not to be taken as setting a precedent and in futurethis would not be found to be a valid reason. However, the case had been cited in othercases and this was clearly the Court of Appeal seizing the opportunity to emphasis the harshpenalties which attach to solicitors who fail to serve:

‘‘In our judgment, the time has come to put the ‘false sense of security’ point firmlyto rest.’’

Therefore if there remained any doubt, the Court of Appeal has dispelled it. A claimantwho relies upon an ex parte order from the court extending time, does so at their peril. Theyfound that the judge who made the ex parte order should not have done so based on thereasons given by the claimant.

However, most of the cases on service have not only related to personal injury matters butto cases where the claimant solicitor had issued close to the limitation period, without thenserving and therefore allowed no room for error. This case was somewhat different. Insteadof the three-year limitation of a personal injury claim, the relevant limitation period was 12years and there were many years to go before the case would be statute barred. This meantthat there would be no prejudice to the defendant in extending the time for service as in themore usual case before the court, where an extension would deprive the defendant of thelimitation advantage. Although the fact that the case was not time-barred would not in itselfbe a reason for a judge to exercise is discretion to extend time, the Court of Appeal felt thatit should be a relevant consideration.

The Court of Appeal also felt that the judge should have taken into account the fact thatthe claimant solicitor had sent a copy of the claim form to the defendants before the expiryof the four-month service period. This was an important factor, not because it constitutedservice but because it brought the claim to the defendant’s attention. In addition, by the timethe case came before the district judge the claim form and particulars of claim had beenproperly served. The Court of Appeal felt that in these circumstances, the district judgeshould not have set aside the order for extended service. This did not make the originaldecision to make the ex parte order right, as at that time, the claim form had not been sentto the defendants.



The Court of Appeal made it crystal clear that this combination of facts was unusual andshould not in any way be interpreted as a softening of the rules in service. Their emphasis onthe cases previously before the court, where claimants and their solicitors have met with littlesympathy, shows that this case was to be treated very much as an exception and claimantlawyers should derive no comfort from it whatsoever. The possible loop-hole of the ‘‘falsesense of security’’ point has been firmly stopped and the position remains very clearly thatclaimant lawyers who issue at the last minute and are not ready to serve proceedings aredicing with danger. The only hope for proceedings served late after obtaining an extensionof time is that defendants will tick the wrong box in the acknowledgement of service andthen fail to make an application within 14 days.

Practice point: The only thing that matters here is to avoid this situation in the first place.Issue and then serve in plenty of time and if necessary make an application for an extensionof time to serve the particulars of claim.

Commentary by Frances McCarthy


digest

Bulletin Board Digest

LIABILITY

Isik v Clegg ((Tugendhat J.), November 8, 2007, [2007] EWHC 2552 (QB) QBD

Personal injury—road traffic accidents—low velocity impact collisions—bur-den of proof—civil evidence—false statements—medical evidence—inaccurateinformation

Burden of proof; Contributory negligence; Measure of damages; Personalinjury; Personal injury claims; Road traffic accidents

The defendant Ms Diane Clegg, a lady in her early twenties, was driving her Citroen C2car along a road towards Wigan. Mr Ayhan Isik was stationary at a traffic light in a RenaultMeganne Coupe. Clegg drew up behind him and stopped. Shortly afterwards, Clegg’s carmoved forward and struck Isik’s car. There was no dispute that a collision occurred betweenthe front of her car and the rear of the Renault driven by the claimant Ayhan Isik. DianeClegg admitted negligence.

As a result, three claims for damages for personal injuries were made against Diane Clegg(one each from Ms Lesley Gostelow and Mr Jeffrey Taylor), plus a claim for damage to theclaimant’s car. There was no dispute that Jeffrey Taylor was, at the time of the accident,sitting in the front passenger seat of Isik’s car.

In separate proceedings brought by Lesley Gostelow, the claimant’s partner, claimed thatshe was also present in the claimant’s car, seated in the rear offside passenger seat. Isikconfirmed this but the defendant denied that Ms Gostelow was in the car. That will clearlybe an issue in the action brought by Ms Gostelow. However as the judge who tries thataction will be likely to have other evidence relating to Ms Gostelow before him, he made nofinding on this point.

The case proceeded to trial in relation only to the claim by Mr Isik, for damages forpersonal injuries and damage to his car. The amount of damages, subject to liability, wasagreed between the parties at £2,250 in respect of the personal injuries and £450 in respectof damage to the car.

The defendant’s case was in effect that the claimant was fraudulently making claims forpersonal injury and damage which he had not suffered and that Gostleow’s claim was alsoentirely fraudulent.

Clegg alleged that she had been stationary but that her car had then rolled down the hill andcollided with the Renault. The accident report photographs showed no sign of damage toIsik’s Renault. Isik initially claimed that there was no hill but admitted when giving evidencethat there was. Clegg claimed that Isik had agreed at the time of the accident that the carswere not damaged and that he was not injured. Isik denied this and gave oral evidence thatthe damage that he claimed had been sustained.

Clegg alleged that Isik had asked for her details so that he could obtain a doctor’s note forfurther time off work for existing back problems. Isik denied that he had been absent from



work or that he had discussed his medical history with Clegg. However, a file from Isik’semployers indicated that he had indeed been absent from work due to a back injury. It alsoturned out that Isik had previously been involved in several road traffic accidents in whichhe had sustained injuries. Although medical reports relating to the two most recent accidentsand this accident were produced by the same surgeon, they contained inaccurate statements.

Clegg’s case was that Isik was fraudulently making claims for personal injury and damagewhen he had not suffered either. Her case was that the inaccurate statements in the medicalreports were due to the fact that Isik had not been honest to his doctors.

The judge held that Isik had indeed deliberately made false statements in order to exaggeratethe damages. He found that there was no damage to his car, pointing out that there was nostatement in the text of the accident report identifying any damage and there was no sign ofdamage in the photographs.

Tugendhat J. accepted Diane Clegg’s evidence that there was no damage and held thather evidence was also to be preferred to Isik’s on other matters where they differed. Isikadmitted that Clegg was correct about the slope and his statement that she was inaccurateabout that was in itself inaccurate. The judge said it was difficult to attribute inaccuracies inIsik’s evidence where he differed from Clegg to honest mistakes. Isik knew the road verywell so he could not have been mistaken when he falsely stated that there was no slope.Isik was also held to be inaccurate when he said that he had never had any time off workwith back problems and the judge concluded that Clegg could not have known that Isik wasabsent from work if he had not told her.

The judge then turned to the question of what Isik had told the doctors. When consideringwhether he had deliberately deceived them, the judge held that it was appropriate to considertwo matters. First, he had the burden of proving on a balance of probabilities that he sufferedthe damage he claimed as a result of Clegg’s negligence and remained throughout. Secondly,it was always open to a court to conclude that whether a claimant had suffered the damagethey claimed, even on a balance of probabilities, remained in doubt. If so the consequencewould be that the claimant failed to discharge the burden of proof.

It appeared to Tugendhat J. that the medical expert did believe that Isik had sufferedinjuries to his back. He held that having regard to the report and to the expert’s answers toquestions, Isik’s evidence about his back injury was not dishonest. However, in the light ofthe points on which he was found to be untruthful, there was doubt as to the truth of whathe stated about his injury to his back.

It followed that Isik had not discharged the burden of proof. The case failed and judgmentwas entered for defendant.

Hughes v Guise Motors (Tugendhat J.), October 23, 2007, [2007] EWHC 2529 (QB)QBD

Personal injury—road traffic accidents—breakdown on motorway—subsequentcollision—highway code provisions—contributory negligence—remaining in carfollowing breakdown

Contributory negligence; Motorways; Road traffic accidents; Speed limits

On Sunday September 5, 2005 Peter Hughes was driving a red Fiat Seicento in a westbounddirection on the M62. His mother was with him, sitting in the passenger seat. Just before5pm the engine cut out, and the car slowed down, for reasons which remain unexplained. It


BULLETIN BOARD DIGEST

came to a halt by junction 25 at a point near that junction of the M62 and the slip road fromwhich vehicles could join the M62 to go in a westbound direction. There was subsequentlyan accident.

Mrs Hughes thought that the car had been travelling at about 60 mph and rememberedthat Peter suddenly said ‘‘it’s cutting out’’. She remembered noticing the entry of the sliproad on the left and that Peter trying to start the car engine by turning the ignition key butwithout success. She noticed the car had stopped at the end of the chevrons and looked tosee if they could get out. She saw that there were cars travelling up the slip road, on her lefthand side. She was worried and thought it was not possible for them to leave the car.

She gave evidence that they would have been dead if they had tried and heard Peter say‘‘this is the worst place in the world to break down’’. She saw the hazard warning lightshad been activated by Peter. She took his phone from his pocket and papers from under thedashboard to look for a telephone number for recovery services. Several cars overtook them,some with their hazard lights on. She said that the time before the collision felt like years toher, or like 10 minutes.

The judge agreed that it was the worst place in the world to break down. The stretch ofthe motorway immediately preceding where they were was on a downward gradient. Thestretch of the road in front was on an upward gradient. That was one reason why the carstopped where it did. The car was in the nearside lane. There were therefore two lanes ofmotorway on the off side of the car and the slip road on the nearside. The hard shoulderof the motorway had come to an end some distance before the point at which the car hadstopped. The hard shoulder of the slip road was the other side of the slip road. The trafficflow was relatively heavy that afternoon.

Within minutes of the engine cutting out, the Fiat was struck from behind by anothervehicle owned by the defendant and driven by Mr Turney, their employee. That vehicle wasan Isuzu 2 axle recovery vehicle. Turney pleaded guilty to careless driving. Peter Hughessuffered serious multiple injuries. Liability was admitted. The only issue at the trial wascontributory negligence.

The substance of the defence of contributory negligence rested on two propositions. Firstthat Peter Hughes failed to steer or coast the vehicle onto the hard shoulder, or some otherplace that was safer than the one where the collision occurred. Second he failed to leavethe car and position himself at a place of safety in line with the provisions of the HighwayCode. The relevant provisions of the Code were in paras.249 and 251 which included thefollowing:

‘‘If your vehicle develops a problem, leave the motorway at the next exit or pullinto a service area. If you cannot do so you should:

• Pull onto the hard shoulder and stop as far to the left as possible,• Leave the vehicle by the left hand door and ensure your passengers do the

same. . .• If you cannot get your vehicle onto the hard shoulder. . .• Leave your vehicle only when you can safely get clear of the carriageway.’’

The judge found that Peter Hughes was unlikely to have appreciated that the gradientwas about to change from downhill to uphill where it did. There was no evidence as towhether he was aware of the effect of the gradient in any event, but if he was aware that hewas coasting down hill, the judge felt that he might well have reasonably supposed that the



downhill gradient would be available to carry him forward to a point where he could reachthe hard shoulder to the nearside of the slip road.

Tugendhat J. accepted that Peter Hughes realised that he was facing an emergency. Thejudge was unable to find, that acting as he did, Hughes was not acting reasonably in thedangerous circumstances in which he found himself. Once Hughes reached the point atwhich the gradient turned against him, the judge found that plainly he could not have gonefurther without engine power. So he could not have reached the hard shoulder on thenearside of the slip road which he found he was aiming to go to.

It was submitted on behalf of the claimant that if he and his mother had evacuated the carand attempted to reach the hard shoulder on the nearside of the slip road, then there wouldhave very likely been a fatal accident in which the driver of the car on the slip road whichkilled them would have raised a defence of contributory negligence on the basis that theyshould have stayed in the car.

As the judge said, at least in the car they had the protection of the bodywork which, asevents proved, did save their lives. If they had been struck while outside the vehicle, theycould not have been expected to survive.

If they had attempted to escape along the broken white line leading to the chevrons andthen up into the space to the east of the chevrons, that would not have involved the riskof crossing the slip road but it would have involved the risk of Mrs Hughes opening thepassenger door onto the slip road, upon which cars were travelling at or near the speed limitwith a view to joining the left hand lane of the motorway. The judge commented that ifthey had been going to do that they would have needed to check very carefully whetherthere was a gap in the traffic to enable them to do so.

The judge accepted the evidence that the motorway was busy and he could not infer thatthere would have been a necessary gap in the traffic on the slip road before the collisionoccurred. He concluded that staying in the vehicle as the claimant did was not unreasonableor negligent, whether on the part of Mrs Hughes. The case that was made for the defendantwas that the time the vehicle was stopped was minutes not seconds. The judge found thatwould not make any difference but he did not accept that it was stopped for minutes in anyevent.

That was enough to dispose of the whole of the defence of contributory negligence.Liability was established in full against the defendant.

Parker v Levy (John Leighton Williams Q.C.), July 20, 2007, (2007) 151 S.J.L.B.1166 QBD

Personal injury—liability—occupiers liability—risk of injury—risk assessments—marinas—moorings—Occupiers’ Liability Act 1957—standard of care—negligence

Marinas; Occupiers’ liability; Personal injury; Risk assessment

Mr and Mrs Parker purchased a 27 foot long motor cruiser called the ‘‘Bully Boy’’ in June2004. Mr Parker arranged for it to be berthed at a marina. He had some sailing experienceand had a RHA Day Skipper ticket for motor boats in coastal waters. However this was hisfirst big boat. Mrs Parker had no previous sailing experience other than some sailing on theNorfolk Broads as a child.



The couple sailed the Bully Boy on 12 occasions without mishap. On September 5, 2004they sailed it downstream from the defendant’s marina on the River Crouch with their twodogs. This trip like the 12 before was to allow them to get used to the boat.

At the end of the trip they returned to the marina. Shirley Parker was assisting her husbandto moor their boat. Mrs Parker was on a finger pontoon holding tightly onto a line to pull theboat in to moor it. Finger pontoons have been commonly used in marinas for many years.She said that there was a surge of water, possibly from the wake of a passing boat, whichcaused her to lose her balance and her left foot went into a gap at the end of the pontoon.She suffered a fracture of the tibia and was terrifyingly suspended upside down under thewater. She was aged 34 at the time.

The case for the claimant was that her presence on the pontoon was reasonably foreseeableand the gap should never have been there; it served no useful purpose and would have costvery little to be filled. If it had not been there the accident would not have happened. Sherelied upon breach of the duty of care under s.2 of the Occupiers Liability Act 1957 andnegligence.

The defendant’s answer was that a pontoon with a gap like this was within the range ofacceptable designs. They were to be found elsewhere and were designed like this by variousmanufacturers. He accepted that anybody going onto the pontoon and overbalancing was atrisk of falling into the water but he denied that the presence of the gap gave rise to suchan increased risk of injury that steps should have been taken to avoid it. The gap was small,readily seen and known by the claimant to be there. She had to take into account its presenceas she also had to take into account the presence of cleats over which she could have tripped.

The judge held that Mrs Parker was on the finger pontoon to pull the boat in at a timewhen her husband was having difficulty controlling the boat. He also held that her beingpulled by the line was the initiating cause of the accident. He was not satisfied that a suddentidal surge caused Mrs Parker to lose her balance, nor that any surge was behind her. Heaccepted that having been pulled by the line it was not difficult to see how her foot could gointo the gap. But he doubted that her foot slipped, feeling that it was more likely that shewas pulled the comparatively short distance to the gap and her foot then went into it.

The judge stated that it was obvious that the end of a finger pontoon the size of thoseat the marina was an insecure place for anybody to be and that its movement could causesomeone standing on it to lose balance. However, he held that the presence of the gap didnot give rise to an increased risk of injury, so that required steps to be taken to avoid therisk. The gap was small, readily seen and known by the claimant to be there. He held that itwould be folly to go so close to it that if thrown off balance, one was liable to step into it.

The judge also pointed out that the pontoon served a purpose as a fender. Some of itsresilience would have been lost had the gap been filled in. He was not satisfied that becausepeople were known to disembark on to the ends of the pontoons, the gaps should have beencovered in. Filing in the gaps would have meant covering in some 300 or so gaps because ofa theoretical risk never known to have manifested itself and not recognised by anyone, andin particular the defendant at the time.

The judge held that the defendant was wrong in stating that there was a written safetypolicy in existence at the time. However, the court he was not satisfied that if any relevantrisk assessment had been made at the time it would have criticised the gaps at the end of thefinger pontoons.

Nor was there anything in a relevant code of practice that would have alerted anyoneto problems. On the evidence overall, the judge held that the presence of the gaps did notgive rise to a reasonably foreseeable risk of injury. They were one of the many acceptabledesigns available. They were provided by other suppliers at another marina because they



were deemed suitable and having been employed there the defendant could not be criticisedfor adopting a similar design at this marina concerned.

The duty of care under s.2 of the Occupiers Liability Act is to take such care as isreasonable. The duty is not to ensure the visitor will be absolutely safe. On the evidence thejudge held that the presence of these gaps did not give rise to a foreseeable risk of injury.They were one of the many acceptable designs available. There was no breach.

The case was dismissed.

Clegg v Rogerson (Nimmo Smith, Wheatley and Brodie L.JJ.), December 04,2007, [2007] ScotCS CSIH 87, IH

Personal injury—road traffic accidents—collision with train—user worked levelcrossing—Road Traffic Act 1988—Highway Code provisions—apportionment—causation

Brain damage; Causation; Material contribution; Personal injury; Reasonablecare; Scotland

This case concerns a tragic accident on a level crossing which resulted in the death of a man,Mr Bruce Thomson, and the serious injury of a three-year-old girl, Sarah Clegg. The claimwas pursued by the parents of the injured girl who sought damages for the depression andother mental disorders which they suffered as a result of the accident. Damages were agreedbetween the parties. The issue before the court was whether, and to what extent, either orboth of the defenders were in breach of their duties of reasonable care to the pursuers asparents of the injured girl, in having caused or materially contributed to the accident.

The accident occurred at the level crossing in Perthshire near to the A9 trunk road betweenBallinluig and Pitlochry. The railway runs parallel to the A9 and the crossing is located withinabout 15m of the northbound carriageway of the A9. The crossing is on a private road leadingto the hamlet of Moulinearn. Until 1997 the crossing was operated by a crossing attendant. Itwas then replaced by a user worked crossing (UWC) which comprised a barrier that extendedacross the width of the road. Drivers operated the crossing electronically, pressing a buttonto raise or lower the barrier. The Moulinearn UWC was a unique crossing.

In its Railway Safety Principles and Guidance (RSPG), HM Railway Inspectorate laiddown conditions for the use of UWCs. Those conditions included the requirement thattrains should not exceed a certain speed and that the crossings should only be used on privateroads. Most UWCs were protected by gates on both sides of the railway. The amount ofadditional protective equipment that might be provided was related to, among other things,train speeds and daily vehicle usage of the crossing.

Where, as at Moulinearn (on the higher estimate of user), the daily road vehicle userwas more than 50 and less than 100, the RSPG recommended the use of gates or barrierscombined with a telephone to a supervising point.

Use of ‘‘miniature stop lights’’ (MSLs) was recommended where the minimum warningtimes of trains could not be obtained and the daily road vehicle user exceeded one hundred.These lights were smaller than traffic lights on public roads. The Moulinearn UWC,through the incorporation of MSLs, included protective equipment beyond that suggestedin the RSPG. The instruction signs at Moulinearn complied so far as material with therecommendations of the RSPG.



As initially designed in 1996, the proposed UWC would have been operated from eitherside of the railway only by two buttons to raise and lower the barrier which were situatedon a pole on the left hand side of the barrier. On the pole there was a klaxon or yodalarm,which was intended to alert pedestrians to the approach of a train. In addition, in very closeproximity to the pole with the buttons and klaxon, there was a pole with a sign with a redlight and a green light containing short instructions.

These lights were smaller than traffic lights on public roads and were known as ‘‘miniaturestop lights’’ (MSLs). Beside the red light were the words ‘‘Red STOP’’ and beside the greenlight were the words ‘‘Green Clear’’.

Immediately beneath the lights were the words ‘‘If no light—phone signalman’’.Immediately beneath the sign containing the lights there was a further sign containingfurther instructions. The instructions were:

‘‘1. Check that green light shows2. Fully raise both barriers3. Check that green light still shows4. Cross quickly5. Lower barrier’’

The green light would change to red and the klaxon would sound when an approachingtrain triggered a treadle on the track, not less than 40 seconds before the train reached thecrossing.

The idea was that a vehicle driver on either side of the crossing would approach thecrossing and observe the MSLs and instructions. The driver would stop and would have toget out of their car to operate the buttons. After crossing the railway the driver would againhave to get out of the car to close the barriers. Following local representations, concerningthe problems which disabled and elderly people would face if they had to get out of theircars to operate the barrier controls, Railtrack agreed to install on the right hand side of theroad on each side of the crossing a pole with controls which could be operated by a driverfrom the driver’s seat in the car.

Initially Railtrack proposed that the controls would be operated by a key which wouldbe issued to a few known elderly drivers who used the crossing. But, as a result of furtherlocal representations which asserted that that would be discriminatory against disabled drivers,Railtrack installed buttons on the driver’s side poles which a driver could operate withouthaving a key.

The driver’s side poles were located about one car’s length from the right hand side of thebarriers. The instructions on each of the poles stated:

‘‘Barrier ControlsEnsure Crossing ClearBefore Lowering BarriersPUSH AND HOLD’’

In addition the word ‘‘Raise’’ was located above the green button and the word ‘‘Lower’’below the red button.

The effect of the introduction of the driver’s side controls was that many users of thecrossing who were familiar with it did not get out of their cars to operate the controls besidethe barrier, but stopped their cars on the right hand side of the private road and operated thedriver’s side controls from within their cars.



There was also on the left hand side of the road as one approached the crossing anotherpole with control buttons which a passenger could operate to raise the barrier before crossingor which a driver could use from within their car to close the barriers once they had crossedthe railway. Those controls had no bearing on the accident.

Either side of the crossing was a telephone linked to the Pitlochry signal box which userscould operate if they needed advice in relation to the crossing. There was also an electronicalarm in the Pitlochry signal box which was activated if the barriers remained in a raisedposition for more than three minutes. This enabled the signalman to warn train drivers toproceed with care.

Most UWCs with barriers in Britain are operated hydraulically by the user who has to getout of their car to do so. Almost all UWCs with electronically operated barriers have thecontrols beside the MSLs at the barrier, again requiring the user to leave their car. There isin Britain one other UWC with electronically operated barriers, which can be controlled bya driver from within their car. That UWC is situated in Sussex and significantly is operatedby key and not by push button. This is why the Moulinearn UWC was a unique crossing.

On May 5, 2001 the pursuers and their children spent the day in the company of thefirst defender and her boyfriend, Mr Bruce Thomson. They were travelling in two cars toMoulinearn. In the pursuers’ car, Mr Clegg was driving and Mrs Clegg was in the back seat.Their son, Charlie, was in the front passenger seat.

In the other, the defender was the driver with Mr Bruce Thomson in the front passengerseat. The pursuers’ three-year-old daughter, Sarah, was seated in the back seat. The pursuerswere following the first defender’s car and shortly after 19.30 they arrived at the junction toMoulinearn together and turned onto the private road.

The first defender, on Mr Thomson’s suggestion, drew into the right hand side of theprivate road beside the driver’s side pole. The first pursuer drove the pursuers’ car to the lefthand side of the private road and stopped beside and slightly behind the first defender’s car.When the cars were stationary on the private road in front of the barrier and when the firstdefender drove across the level crossing, the red MSL was on and the klaxon was sounding.Investigations after the accident showed that the warning equipment and the barriers were inworking order at the time of the accident.

The first defender, whom Mr Thomson was instructing on the use of the controls, initiallyopened the passenger window by mistake before closing it and opening her window. She hadsome difficulty operating the driver’s side controls as she did not keep her hand pressed onthe raise button with the result that the barrier started to open then stopped. However, whenMr Thomson asked her to keep her hand on the control button, the barrier was raised. Shethen drove over the crossing, looking to see if a train was coming. When the first defender’scar was almost across the crossing it was struck on the rear nearside by a train travelling in anortherly direction at almost 80mph.

There was nothing that the train driver, who was driving within the speed limit for thetrack, could have done to prevent the accident. The impact of the train catapulted the rear ofthe car into the barrier mechanism on the Moulinearn side of the crossing and its front spuninto contact with the train. As a result of the accident Mr Thomson died of his injuries inPerth Royal Infirmary and the pursuers’ daughter suffered brain damage.

The pursuers pleaded a case of fault against the first defender and submitted that she hadfailed to exercise reasonable care by crossing the level crossing when the red MSL was onand the klaxon was sounding. The first defender pleaded a case of sole fault or in any eventcontribution against the second defenders arising out of what was averred to be an inherentlydangerous design of the crossing.



At first instance Lord Hodge1 recognised that there may be people who could be misledby the fact that the barrier rose. However he did not accept that a reasonably careful driverwould ignore the important difference between an automatic crossing on a public road anda UWC, namely that the barriers in the former are operated without any action by a driverwhile the barriers in the latter are normally in a closed position and open only if the drivertakes steps to open them.

He held that the fact that the driver had to take the initiative ought to cause the carefuldriver to instruct themselves on the operation of the crossing. Exercising reasonable care, adriver would have looked for instructions on a safe means of crossing the railway. A carefuldriver looking for instructions at Moulinearn would not have had difficulty in finding them.

The Highway Code of the time in the section on railway level crossings at para. 269discusses user operated gates and barriers stated:

‘‘Some crossings have ’Stop’ signs and small red and green lights. You MUST NOTcross when the red light is showing, only cross if the green light is on. If crossingwith a vehicle, you should

• Open the gate or barriers on both sides of the crossing• Check that the green light is still on and cross quickly• Close the gates or barriers when you are clear of the crossing.’’

Section 38(7) of the Road Traffic Act 1988 provides that a failure of a person to observe aprovision of the Highway Code may be relied on in civil proceedings as tending to establishliability.

Lord Hodge held that the failure to observe the Highway Code confirmed his opinion thatthe accident was caused by the first defender’s fault.

The judge then turned to the case against the second defenders who were the successorsto Railtrack. They denied any liability and pleaded that the layout of the crossing and itsconstruction had been authorised in compliance with an order made by the Secretary of Statefor Transport under s.1 of the Level Crossings Act 1983 and had been approved by HMRailway Inspectorate.

There was evidence of three ‘‘near misses’’ at the Moulinearn UWC in which drivers hadcrossed the crossing in front of an approaching train on April 11, 1998, October 4, 1999 andNovember 25, 1999 respectively. After the third reported safety incident, Railtrack shouldhave carried out a risk assessment of the UWC if they had complied with their own safetystandards. They did not do so before this accident. Following the accident Railtrack andother interested parties obtained reports assessing what might have been done to prevent it.Subsequently various changes were made to improve safety.

The judge held that the second defenders were under a duty at every level crossing wherethere is reason to expect members of the public to be to take all reasonable precautions toreduce the danger to the public to a minimum. The fact that the second defenders wentthrough the statutory procedure to obtain the approval of HM Railway Inspectorate andobtained that approval for the level crossing did not exclude liability for negligence. However,it was held to be relevant in considering whether or not Railtrack were negligent.

The judge discounted any argument that the low level of usage would necessarily havejustified less protection of users than would otherwise be the case. This was a unique crossing.

1Clegg v Rogerson & Network Rail Infrastructure Limited [2005] Csoh 113.



The uniqueness of the crossing required Railtrack to consider its layout carefully. He heldthat in weighing up the probability and seriousness of a risk Railtrack (and HM Inspectorate)should have been able to foresee the careless driver as well as the careful driver. Therewere numerous criticisms of the second defenders. However, the judge concluded that thecritical question was whether any failure by Railtrack caused or materially contributed to thisaccident.

While he criticised Railtrack in particular for not introducing instructions at the driver’sside controls, he was not persuaded that the absence of those instructions caused the accident.Having regard to the speed with which and manner in which the first defender raised thebarriers and the fact that she was carrying out Mr Thomson’s instructions, he did not acceptthat she would have read such instructions any more than she did the instructions on thedriver’s side pole to push and hold the control button to raise the barrier. He was also notpersuaded that if there had been MSLs and instructions on the right hand side of the barrier,it was more likely than not that the accident would have been avoided.

The key was that the first defender was not looking for external guidance but was carryingout Mr Thomson’s instructions. He concluded Railtrack’s failures were not causativelynegligent. The pursuer succeeded in full against the first defender. The first defenderappealed.

After a detailed review of the case, the appeal court reached the conclusion that there wereinsuperable obstacles to Miss Rogerson’s attempt to secure a contribution from NetworkRail. They pointed out that the Lord Ordinary had held that she did not apply her mind toascertain the safe way to cross the railway and did not read the visible instructions but ratherfollowed the guidance of Mr Thomson. She did not seek to displace this finding.

Likewise, she did not seek to displace the finding that she was content to act on MrThomson’s prompting to raise the barrier and attempt to cross the railway, and in so actingfailed to keep a proper look out and to have regard to the red MSL and instructions and thusfailed in her duty of care.

They pointed out that the Lord Ordinary found her evidence to be unreliable in severalrespects, and did not accept her evidence that, if there had been MSLs and a sign with theinstructions of the right hand side of the barrier and instructions at the driver’s side pole, shewould probably have taken heed of them and desisted from crossing. Instead he found thather acts were consistent with a failure to apply her mind to the issue of safety and an unduereliance on Mr Thomson’s instruction to raise the barrier and cross the railway.

Moreover, they noted that the Lord Ordinary attached significance to an incident inDecember 2000 when Miss Rogerson and Mr Thomson waited at the A9 side of the crossingin the dark for over half an hour because the klaxon was sounding. He held that it was highlyunlikely that she did not see the red MSL when she spent between 30 and 40 minutes in a carin front of the barrier. In addition he held that she would have realised from her experienceof this incident that the barrier might be raised when the warning system was on.

They concluded that given the state of the evidence, the Lord Ordinary’s assessment ofMiss Rogerson’s reliability, and above all his specific findings of fault on her part, there was noroom for displacing the Lord Ordinary’s decision on what they said he rightly characterisedas ‘‘the critical question in this case’’. That was deciding that he was not persuaded that theabsence of instructions at the driver’s side controls had any part to play in the causation ofthe accident.

The appeal was dismissed.



Quantum

Johnston v NEI International Combustion Ltd; Rothwell v Chemical & InsulatingCo Ltd ; Topping v Benchtown Ltd; Grieves v FT Everard & Sons (Hoffman, Hope,Scott, Rodger and Mance L.JJ.), October 17, 2007, [2007] UKHL 39, HL

Personal injury—employers’ liability—asbestos exposure—pleural plaques—anx-iety—risk of future disease—causes of action—psychiatric harmreasonable forti-tude—Supreme Court Act 1981 s.32a

Asbestosis; Causes of action; Employers’ liability; Psychiatric harm

The claimants had been negligently exposed to asbestos dust by the various defendantemployers, and had developed pleural plaques. Pleural plaques do not usually cause anysymptoms, nor do they cause asbestos-related diseases. What they do is signal the presence inthe lungs and pleura of asbestos fibres that might independently cause life-threatening or fataldiseases.

One claimant, Mr Greaves, had developed not merely anxiety but clinical depression, arecognised psychiatric illness, in consequence of being told that his pleural plaques indicateda significant exposure to asbestos and the risk of future disease.

The claimants accepted that they had no freestanding claim for either the risks of developingdiseases in the future (as it was not pleural plaques themselves that gave rise to them) orfor anxiety. However they all claimed that, taken in combination, those various elementsamounted to an injury that was more than negligible. They won at first instance but lost inthe Court of Appeal and appealed to the House of Lords.

The Court of Appeal’s decision was that pleural plaques caused by negligent exposure toasbestos, which were not in themselves damage that could give rise to a cause of action,did not become actionable damage when aggregated with the risk of future disease andconsequent anxiety. They also held that the psychiatric injury suffered by Mr Greaves wasnot a reasonably foreseeable consequence of the negligence.

In the House of Lords the appeals failed on all points. The House of Lords held unanimouslythat pleural plaques caused by negligent exposure to asbestos, which were not in themselvesdamage that could give rise to a cause of action, did not amount to actionable damage whenaggregated with the risk of future disease and consequent anxiety, neither of which in itselfwas actionable.

Their view was that symptomless plaques were not damage that could found a causeof action. Neither the risk of future disease nor anxiety about the possibility of that riskmaterialising, amounted to damage for the purpose of creating a cause of action. Althoughthey accepted that the law allowed the risk of future disease and consequent anxiety to betaken into account in computing the loss suffered by someone who had actually sufferedsome compensatable physical injury, in the absence of such compensatable injury, there wasno cause of action under which damages could be claimed. That meant there could be nocomputation of loss in which the risk and anxiety could be taken into account.

They also held that the Supreme Court Act 1981 s.32A, which allows a claimant to obtainprovisional damages where there is a chance that a serious disease will develop in the future,does not support the aggregation theory. The provision makes it clear that it applies onlywhere the claimant has a cause of action.



Finally they held that Mr Greaves’ psychiatric illness was not a reasonably foreseeableconsequence of his employers’ breach of duty. It was not foreseeable that the creation of arisk of an asbestos-related disease would cause psychiatric illness to a person of reasonablefortitude. To do this they distinguished Page v Smith [1966] A.C. 155 on the facts.

The appeals were dismissed.

Grieves v FT Everard & Sons (Hoffman, Hope, Scott, Rodger and Mance L.JJ.),October 17, 2007, [2007] UKHL 39, HL

Personal injury—causes of action—psychiatric injury—reasonable fortitude—em-ployers’ liability—asbestos exposure—pleural plaques—risk of future disease—Supreme Court Act 1981 s.32a

Asbestosis; Causes of action; Employers’ liability; Pre-existing condition;Psychiatric harm

Mr Grieves was suing two past employers who admitted that they negligently exposed himto asbestos dust. He developed his psychiatric illness as a result of an X-ray examination in2000. The lords held that the question of whether he was owed a duty of care in respect ofthat illness had to be answered by reference to the principles stated by Hale L.J. in her ‘‘lucidand comprehensive judgment2’’ in Hatton v Sutherland [2002] I.C.R. 613, approved by thelords in Barber v Somerset CC [2004] 1 W.L.R. 1089.

That judgment was concerned with psychiatric injury caused by subjecting an employee tooccupational stress, but Lord Hoffman concluded that the general principles were applicableto psychiatric injury caused by any breach of duty on the part of the employer.

Hale L.J. said that:

‘‘3the threshold question is whether this kind of harm to this particular employeewas reasonably foreseeable.’’

She rejected the general applicability of the test of whether psychiatric injury was foreseeablein a person of ‘‘ordinary fortitude’’ because an employer’s duty was owed to each individualemployee and not an undifferentiated member of the public.

Lord Hoffman expressed the view that an employer may know (or it may be that theyshould know) of a particular vulnerability in an employee. In that case, they have a duty totreat an employee with appropriate care. On the other hand, in the absence of some particularproblem or vulnerability, the employer was entitled to assume (in a case of occupationalstress) that the employee is ‘‘up to the normal pressures of the job’’.

Applying that to the broader question of psychiatric illness, he held that in the absence ofcontrary information, the employer is entitled to assume that his employees are persons ofordinary fortitude.

In Mr Grieves’ case, he concluded that the employer would be unlikely to have any specificknowledge of how a particular employee was likely to react to the risk of asbestos-relatedillness more than 30 years after he had left his employment. He held that an assumption ofordinary fortitude was therefore inevitable.

2Lord Hoffman at [24].3At p.624, para.23.



Considering foreseeability Lord Hoffman recognised that the answers to a test offoreseeability will vary according to two things. First, the precise description of what shouldhave been foreseen and, secondly, the degree of probability which makes it foreseeable.

Having considered Hughes v Lord Advocate [1963] A.C. 387 and Jolley v Sutton LBC [2000]1 W.L.R. 1082, Lord Hoffman referred to Lord Reid’s well-known dictum in OverseasTankship (UK) Ltd v Miller Steamship Co (The Wagon Mound (No.2)) [1967] 1 A.C. 617,643–644 which shows that the degree of probability which counts as foreseeability may varyaccording to other factors in the case:

‘‘If a real risk is one which would occur to the mind of a reasonable man inthe position of the defendant’s servant and which he would not brush aside asfar-fetched, and if the criterion is to be what that reasonable man would havedone in the circumstances, then surely he would not neglect such a risk if actionto eliminate it presented no difficulty, involved no disadvantage, and required noexpense.’’

Hoffman’s view was that in the case of psychiatric illness, the standard description of whatshould have been foreseen, namely that the event which actually happened would havecaused psychiatric illness to a person of ‘‘sufficient fortitude’’ or ‘‘customary phlegm’’, hasbeen part of the law since the speech of Lord Porter in Bourhill v Young [1943] A.C. 92, 117.

That was plainly intended to make the test more difficult to satisfy than whether it wasforeseeable that something might happen which would cause someone (or even a person ofreasonable fortitude) to suffer psychiatric injury. Of course the latter test would not be hardto satisfy, as can be seen from the opinion of the majority of the House in Page v Smith [1996]A.C. 155.

In Page v Smith it was held to be sufficient that the defendant should have foreseen thathis negligent driving might cause some physical injury. It did not matter than he could nothave foreseen that the event which actually happened, namely a minor collision, would causepsychiatric injury.

However Lord Hoffman’s opinion was that the test in Page v Smith was applicable only inthe special circumstances of that case.

He held that the general rule still requires the court to decide whether it was reasonablyforeseeable that the event which actually happened (in this case, the creation of a risk of anasbestos-related disease) would cause psychiatric illness to a person of reasonable fortitude. Hethought that the Court of Appeal was right to say that there was no basis for such a finding.

Happily Lord Hoffman did not think that it would be right to depart from Page v Smith.He said that it did not appear to have caused any practical difficulties and was not likely to doso if confined to the kind of situation which the majority in that case had in mind. That wasa foreseeable event (a collision) which, viewed in prospect, was such as might cause physicalinjury or psychiatric injury or both. Where such an event has in fact happened and causedpsychiatric injury, the Lords decided that it is unnecessary to ask whether it was foreseeablethat what actually happened would have that consequence. He concluded that either form ofinjury is recoverable.

In Mr Grieves’ case, the foreseeable event was that he would contract an asbestos-relateddisease. If that happened, it could no doubt cause psychiatric as well as physical injury. Butthe event had not occurred. The psychiatric illness had been caused by fear that the eventmay occur. Lord Hoffman held that the creation of such a risk is not in itself actionable.He thought it would have been an unwarranted extension of the principle in Page v Smith



to apply it to psychiatric illness caused by apprehension of the possibility of an unfavourableevent, which had not actually happened.

Lord Rodger agreed and pointed out that in Page v Smith the plaintiff suffered psychiatricharm as a result of being exposed to, but escaping, instant physical harm. In other words,he developed his illness as an immediate response to a past event. Here, by contrast, MrGrieves developed his illness on learning of a risk that he might possibly develop asbestosis ormesothelioma at some uncertain date in the future.

Lord Rodger felt that allowing his claim would constitute an expansion of the rule inPage v Smith, contrary to the ‘‘thus far and no further’’ guidance of Lord Steyn in Frost vChief Constable of South Yorkshire [1999] 2 A.C. 455. He also noted that In Page v Smith themechanism (the crash) which caused the onset of the plaintiff’s psychiatric harm, was thesame mechanism as had been liable to result in physical harm to him.

Here, by contrast, the mechanisms were different. The risk that Mr Grieves would developasbestosis or mesothelioma was caused by the defendant’s wrongdoing. On the other hand,his depression was due to his doctor intervening to tell him about the plaques and to theevents following on that, including, possibly, some misinformation provided to him by otherpeople.

For Lord Rodger that distinction confirmed that an award of damages for Mr Grieves’illness would go further than the award for the plaintiff’s illness in Page v Smith.

Lord Mance and Lord Hope agreed but left open the correctness of Page v Smith foranother day. Lord Mance could see some force in the criticisms that have been levied againstit, and was not confident that it does not cause uncertainty and argument as it did here.

He reminded us that psychiatric illness resulting over time from the exacerbation of aphysical condition, contributed to by anger about the occurrence of a past accident (in whichthe claimant suffered a physical injury), was held recoverable irrespective of foreseeability inSimmons v British Steel Plc [2004] I.C.R. 585, in reliance on Page v Smith.

On the other hand, this case establishes that psychiatric illness arising from the stress ofbelated discovery of a continuing risk of future physical illness arising from past exposure toasbestos dust is not actionable, in the absence of specific foreseeability.

He felt that some artificiality may be a necessary result of the controls on which the lawinsists in this area. But this distinction, although one that he endorsed, was not, particularlyhappy although he felt it was unnecessary to say more about it in this case.

Smith v Bolton Copper Ltd (Master Whitaker), unreported elsewhere, June 10,2007 QBD

Damages—personal injury—asbestos exposure—mesothelioma—JSB uideli-nes—measure of damages—short survival period—dependency claims—broth-ers—assessment of dependency claim—Fatal Accidents Act 1976

Dependency claims; Mesothelioma; Pre-existing condition

George Smith was exposed to asbestos as a result of his employment with Bolton CopperLtd. He contracted mesothelioma of both the pleura and the peritoneum. The disease took avery rapid course and led to death within two or three months. The claim was brought byGraham Smith, the twin brother of the deceased and the administrator of the estate.

There were three issues:



i. Did this case fall within the bracket for general damages for mesothelioma set out in theJSB guidelines?

ii. What was the appropriate damages for care?iii. Was there a dependency under the Fatal Accidents Act 1976 and if so, how it was to be

assessed?

This illness is described in the JSB guidelines as, ‘‘Mesothelioma causing severe pain andimpairment of both function and quality of life’’ . Master Whitaker confirmed that to be anaccurate description of this disease .

The guidelines continue by saying that the mesothelioma, ‘‘may be of the pleura, the lunglining, or of the peritoneum, the lining of the abdominal cavity’’. They then go on to say ,‘‘The duration of pain and suffering accounts for variations within this bracket.’’

The range in the eighth edition of the guidelines is £47,850–£74,300. The effective dateof the guidelines is June 2006, which updated for a year, using Kemp, meant the bottom ofthe bracket would then have been be roughly £49,000.

In fact this case was one of those less common cases involving mesothelioma of both thepleura and the peritoneum. The guidelines point out that the peritoneal type of mesotheliomais typically the more painful. Master Whitaker recognised that we had here not only a caseof the worst type in terms of pain, the peritoneum, but also one which was reducing thefunction of the lungs by approximately 50 per cent.

Commenting on this type of case Master Whitaker said:

‘‘I have been in charge to the specialist list for Mesothelioma and other asbestosrelated disease claims at the RCJ for over 5 years and the evidence in this case is verytypical of the progress of a fast-moving mesothelioma. When assessing damages, theimportant factors, in my judgment, to bear in mind in relation to a death frommesothelioma are somewhat wider than those set out in the guidelines. One has gotto be careful when approaching this part of the guidelines to remember:

(a) they are only guidelines and(b) the words of the guidelines are not to be construed as a statute(c) Mesothelioma is a disease, the incidence of which is growing fast but the

experience of the courts in assessing damages in respect of the disease is still inits infancy.

Although mesothelioma has become, in the last ten years, a much more common cause ofdeath (and indeed now the number of claims being issued is running very high indeed; at thiscourt probably 600 a year) it is not one that was frequent in the courts before that. It is in avery different category from the general run of illnesses and diseases which are described inthe guidelines, in that it is invariably fatal and usually extremely painful’’.

The master held that it was possible for cases to fall below the bottom level in the JSBguidelines, but this case was not one of those. The bottom level of the bracket was reserved forthose people who suffered the horrible death associated with mesothelioma and its symptoms,but for a relatively short period, such as a matter of days or a week or two. In this casethe suffering was for a couple of months and was the more painful type of the disease, so itwas necessary to move up the bracket. The appropriate level of the award was held to be£55,000.



Graham Smith and his twin brother George had lived together all their lives. The level ofcare provided by Graham was held to have been extremely close and attentive. It was notedthat they had spent most of their lives looking after each other, so things were unlikely to beany different in the last weeks of the deceased’s life. In the circumstances an hourly rate of£7 over the total number of hours for the period in question was considered appropriate.

The court held that the appropriate test for damages under the Fatal Accidents Act 1976was that they should be calculated in reference to a reasonable expectation of pecuniarybenefit as of right or otherwise from the continuance of life.4

It was accepted that the twins lived together and did practically everything together. Therewas a considerable element of depth of care and services that they gave each other duringtheir cohabitation. This related to the fact that they were brothers, rather than just peopleliving together.

Graham Smith could not replace the services of his deceased brother simply by asking afriend who did not want to live on his own to come and live with him. It was held that therewas a proper claim under the Act. A figure of £2,000 per year with a multiplier of 12.5 washeld to be appropriate in the circumstances.

Damages were assessed accordingly.

Bereavement damages

Damages—personal injury—Fatal Accidents Act 1976—Fatal Accidents (NorthernIreland) Order 1977—bereavement awards—level of awards

Bereavement; Fatal accident claims; Personal injury

From January 1, 2008 the level of bereavement damages awarded under s.1A of the FatalAccidents Act 1976 was increased from £10,000 to £11,800. This increase also applies, fromthe same date, to cases covered by Art.3A(5) of the Fatal Accidents (Northern Ireland) Order1977.

The increased level of the award applies to all causes of action that accrued on or afterJanuary 1, 2008. Bereavement awards remain at the old level of £10,000 for cases in whichthe cause of action accrued between April 1, 2002 and December 31, 2007. Up to andincluding March 31, 2002 the level of an award was £7,500.

Tameside & Glossop Acute Services NHS Trust v Thompstone South YorkshireStrategic Health Authority v Corbett United Bristol Healthcare NHS Trust v RHSouth West London Strategic Health Authority v DE Haas CA (Civ Div) (WallerL.J. V.-P., Buxton L.J., Smith L.J.) January 17, 2008 [2008] EWCA Civ 5

Personal injury—damages—future loss—indexation—periodical payments order-s—correct approach to exercise of power to make periodical payments ordersunder s.2(1) of the Damages Act 1996—care expense—retail prices index—ashe611—burden of proof—s.2(9) of the Damages Act 1996—s.2(8) of the Damages Act1996—s.2(1) of the Damages Act 1996—guidance on future cases and the use ofexperts

4Franklyn v South Eastern Railway [1858] 157 E.R. 448 applied.



Burden of proof; Future loss; Indexation; Measure of damages; Periodicalpayment orders; Personal injury

These defendant appeals involved periodical payments orders under s.2(1) of the DamagesAct 1996. In all four cases, liability had been admitted. All were concerned with severelyinjured claimants who were seeking future losses, particularly costs of future care. FollowingFlora v Wakom (Heathrow) Ltd,1 at first instance the judge in each case had accepted that theycould make appropriate orders for periodical payments whenever it appeared appropriate andfair to do so.

In three of the four cases, the first instance judge decided to make an order under s.2(9)modifying the effect of s.2(8) by providing for the amount of the payments to vary byreference to the Annual Survey of Hours and Earnings for the occupational group of careassistants and home carers (ASHE 6115) produced by the Office of National Statistics.

On the appeals among other things, the defendants argued that:

i. Flora had been decided per incuriam and was therefore not binding;ii. the word ’’modifying’’ in s.2(9) related to the ’’index’’ and was therefore limited

to increasing or decreasing the retail prices index (RPI) specified in s.2(8);iii. the principle of distributive justice required that s.2(9) should be used to disapply

the RPI only in exceptional circumstances;iv. the claimant had the burden of showing that there was an appropriate alternative

to the RPI; andv. the use of an index or measure such as ASHE 6115 contravened the principle on

which future losses should be assessed as set out in Cookson v Knowles;2 ASHE6115 was unsuitable as an instrument of indexation.

The Court of Appeal had little hesitation in concluding that the submission that Flora hadbeen decided per incuriam was hopeless. The authority relied on by the defendants3 hadbeen cited and considered at length in Flora. Unsurprisingly it was distinguished and Florafollowed.

They held that Flora required the court to reject the defendants’ second submission that’’modifying’’ was limited to increasing or decreasing the retail prices index. They made itclear that it was ’’corrective justice’’, not distributive justice, with which the court should beconcerned.

They confirmed that Swift J. was right when she stated4 that her task was to decide whatform of order would best meet the claimant’s needs and to determine, as far as s.2(8) ands.2(9) were concerned, what was appropriate, fair and reasonable had been correct. She wasalso confirmed right to say that such matters did not lend themselves to determination by theburden of proof, and that the claimant had only an evidential burden. The question whetherthe RPI should be replaced would depend on the alternatives available and was bound to bea comparative exercise.

1In each case the judge had regard to the authority of Flora v Wakom (Heathrow) Ltd [2006] EWCA Civ 1103, whichdecided that s.2.(9) of the 1996 Act allowed the court to make the orders identified therein not simply in exceptionalcircumstances but whenever it appeared appropriate and fair to do so.

2Cookson v Knowles (1979) A.C. 5563Cooke v United Bristol Healthcare NHS Trust [2003] EWCA Civ 13704Para.[52] of her judgment in Thompstone



As far as the defendants’ fifth submission was concerned they held that it was misconceived.They pointed out that Cookson was concerned with lump sum awards and a periodicalpayments order is a wholly different creature. Consequently Cookson was easily distinguished.

They then considered the defendants’ objections to ASHE 6115 and concluded that noneof them were well founded. This led them on to what should happen with future cases.

Significantly they ruled that it will not be appropriate to reopen argument on the suitabilityof ASHE 6115 in future proceedings unless a defendant can produce evidence and argumentsignificantly different from, and more persuasive than was deployed in these cases. They alsoheld that indexation and the allocation of heads of damage between lump sum provision andperiodical payments orders were interrelated and should be considered together.

They also held that a claimant’s ’’needs’’ were not limited to the needs that he demonstratedfor the purpose of proving the various heads of damage but included those things that heneeded to enable him to organise his life in a practical way. The judge should apply anobjective test. He had to have regard to the wishes and preferences of the parties and to allthe circumstances, but ultimately it was for him to decide what order best met the claimant’sneeds.

Finally on expert evidence, they held that the report of an independent financial adviser waslikely to help the judge. The judge should have regard to the defendant’s general preferenceswithout the need for evidence to be called, and it would only be in a rare case that it wouldbe appropriate for a defendant to call expert evidence to seek to show that the form of orderpreferred by the claimant would not best meet his needs.

The appeals were dismissed.5

Procedure

Jones v Associated Newspapers Ltd ((Eady J.), June 25, 2007, [2007] EWHC 1489(QB), QBD

Civil procedure—costs—Pt.36 offers—judgment against defendant—proposalscontained in claimant’s Pt.36 offer—meaning of ‘‘at least as advantageous toclaimant’’—indemnity costs—enhanced interest—CPR Pt.36.14(1)(b)

Indemnity basis; Libel; Part 36 offers

The claimant sought his costs of a successful libel action on the indemnity basis togetherwith interest under CPR Pt.36.14(1)(b) on the basis that the judgment against the defendantnewspaper was at least as advantageous to him as the proposals contained in a Pt.36 offermade by him 11 months before trial.

The facts were that the claimant was, and is, the Labour Member of Parliament for ClwydSouth. He had sued in respect of articles in the issues of the Mail on Sunday, publishedrespectively on May 14 and 21, 2006.

The first was headed ‘‘Labour MP in foul–mouthed outburst at police guard.’’ It allegedthat during an incident (on May 10, 2006) in Portcullis House (part of the Parliamentary

5For detailed comment on this case see the article in this edition of the journal by Harry Trusted, Counsel for one of theclaimants in the appeals entitled ‘‘Periodical Payments after the Court of Appeal decision in Thompstone’’.



estate) the claimant had refused to show a security guard his House of Commons pass whenrequested to do so and twice told him to ‘‘fuck off’’.

The claimant alleged that the article contained meanings defamatory of him, whichincluded that he had refused to show his pass; that he had told the police security guardto ‘‘fuck off’’ twice; that as a result of his conduct the serjeant at arms had called for aninvestigation into his conduct; that he had been reported to the Labour Party Whips becauseof his conduct; and that he was to be disciplined by the speaker following a complaint by afellow member of Parliament.

The second article appeared in the newspaper’s ‘‘Black Dog column’’ and described theclaimant as ‘‘ludicrous’’. It is alleged that the article bore the meaning that he had concocteda farcical and dishonest excuse to explain why he swore at a police security guard, who hadasked him to produce his pass; namely, to the effect that ‘‘he couldn’t wear one because if AlQa’eda had got in, they would have been able to identify him’’.

The claimant gave evidence himself and called Mr Bob Ainsworth M.P., the Deputy ChiefWhip, and Sir Stuart Bell M.P., who had been referred to and quoted in the first article.

The defendant relied upon the evidence of the security guard, the Serjeant at Arms, ChiefSuperintendent David Commins, who is the divisional commander responsible for day today security at the Palace of Westminster, and Inspector Andrew Richford, who serves asthe operations inspector within the parliamentary estate and is one of the security guard’ssuperior officers.

The newspaper accepted that, in certain respects, its article had been inaccurate but pleadedjustification on the basis that its defamatory sting was substantially true. In particular, thesecurity guard, Mr Christopher Ham aged 21, was called to confirm that the claimant hadonly shown his pass to him on the morning in question at the third request and with ‘‘badgrace’’. He gave evidence also that he had indeed told him to ‘‘fuck off’’ at the first tworequests.

The claimant denied that he had used that expression, but nevertheless accepted that heonly showed the pass with bad grace at the third request, having earlier told the securityoffice that he did not ‘‘give a shit’’ what he was and that he ought to have been in a positionto recognise all members of Parliament.

The paper accepted that in certain respects its article had been inaccurate but pleadedjustification on the basis that its defamatory sting was substantially true. The jury rejected thesubmission that the article was substantially true and awarded damages of £5,000.

Before trial an offer had been made by Jones to settle the case for £4,999 plus an apology.The newspaper submitted that the criteria set out in CPR Pt.36.14(1)(b)5 had not beenfulfilled. Before dealing with the issue Mr Justice Eady commented:

‘‘One can only speculate, in these circumstances, as to the evidence that wasaccepted and rejected by the jury and as to its reasoning processes. It would appearthat the majority rejected the security officer’s evidence at least in some respects,and in particular as to whether or not the Claimant told him to ‘‘fuck off’’, but MrLivesey does not accept that this is necessarily so. Whatever the position, it seemsclear that the jury rejected the submission that the article was substantially true. It isunnecessary to speculate further.’’

536(14)(1)(b) judgment against the defendant is at least as advantageous to the claimant as the proposals contained in aclaimant’s Pt.36 offer.



The judge held that an award of damages for defamation was supposed to take account ofinjury to reputation and hurt feelings down to the moment of the jury’s verdict or judgmentif the trial was by judge alone. For that reason, it had been recognised that it would generallybe inappropriate to award interest on libel damages, even under the Pt.36 regime, from themoment that the cause of action arose.

He considered that that consideration needed also to be taken into account in determiningthe issue of whether the judgment obtained was more advantageous to Jones than theproposals contained in the Pt.36 offer or the broader question of who might be said to havewon. That meant it was necessary to compare the value of a payment of £4,999, coupledwith a suitable apology, with the award of £5,000 following a contested trial 11 months later.

The judge acknowledged that Jones would undoubtedly have suffered concern and distressin that 11-month period leading up to and including the public hearing, during which hisreputation was attacked in the process of attempting to justify the libel. The jury in arrivingat its award would have taken all of that into account.

At the time the Pt.36 offer was made, those elements of injury were yet to be incurred. Inpurely financial terms, therefore, the jury’s award was less advantageous than the offer.

Apart from monetary value, it was also appropriate to compare the worth of the unqualifiedapology Jones had been seeking with the vindication subsequently obtained. This was becausea number of matters had been publicly canvassed which would not have emerged if the offerhad been accepted. The judge concluded that in all the circumstances, the ultimate outcomewas not ‘‘at least as advantageous’’ as the offer made and, therefore, r.36.14 did not apply.

The judge also ruled that if, contrary to his primary conclusion, he had reached the stageof exercising his discretion under CPR 36.14, he would not have decided that there wasanything unjust about the claimant recovering indemnity costs as such. That would obviouslyhave been on the hypothesis that the Pt.36 offer had been ‘‘at least as advantageous’’ as thefinal outcome.

However he did not think it would have been appropriate to award interest at an enhancedrate in these particular circumstances, and where:

(a) the claimant himself was not out of pocket; and(b) the solicitors were to receive, in any event, a 100 per cent uplift on the recoverable

costs.

The judge emphasised that this would not necessarily apply in all CFA cases saying:

‘‘It is clear that the rule requires the individual judge to consider what is ‘‘just’’ onthe particular facts of the case in hand.’’

In the event, however, this stage was not reached because the judge held that the thresholdcriteria set out in CPR 36.14(1)(b) had not been fulfilled. He awarded the claimant thecosts of the action on the standard basis only. He awarded neither interest on damages norenhanced interest on costs.



Jones v Wrexham BC (Waller (V.P.), Longmore and Hughes L.JJ.), December 19,2007, [2007] EWCA Civ 1356, CA (Civ Div)

Civil procedure—personal injury—legal advice and funding—costs—conditionalfee agreements—claims management—after the event insurance—construing aCFA agreement—meaning of words ‘‘or otherwise’’—Conditional Fee Agreements(Miscellaneous Amendments) Regulations 2003 reg.3a(5)—Conditional FeeAgreements Regulations 2000 reg.4(e)(ii)—CPR Pt.43.2(3)

Conditional fee agreements; Funding arrangements; Solicitor and client costs

In this case the claimant, a child, was injured on September 1, 2002. On May 16, 2003her mother entered into a loan agreement and insurance policy with Claims Bureau UK(CBUK). The certificate of insurance covered the pursuit of a personal injury claim arisingout of the accident and, provided that the appointed representative should be a panel solicitorof CBUK, to be advised. There was a limit of indemnity of £25,000.

CBUK referred the matter to Birchall Blackburn, a panel solicitor. The solicitors wrote toMrs Jones on June 2, 2003 confirming acceptance of instructions and setting out a detailedclient care letter, written pursuant to r.15 of the Law Society’s Solicitors’ Practice Rules.The letter requested the signing of a CFA, a document of some five pages, referring to andincorporating a further five pages of Law Society conditions.

The r.15 letter recommended the insurance with CBUK for the reasons set out in theCFA. In the CFA it was stated that CBUK ‘‘litigation insurance cover is only made availableto you by solicitors who have joined the scheme’’.

In the final term of the CFA the solicitors stated: ‘‘We confirm that we do not have aninterest in recommending this particular insurance agreement.’’

The Court of Appeal has previously considered the enforceability of conditional feeagreements. In those cases the Conditional Fee Agreements Regulations 2000 were whatmattered. Those challenges to enforceability were on the whole, not by the clients theregulations were designed to protect, but by defendants, who having accepted liability in themain proceedings then resisted liability under the order for costs in the claimant’s favour.

Waller L.J. noted that the Court of Appeal had, in a number of decisions, sought todiscourage the taking of technical points by defendants on the 2000 Regulations and that bythe Conditional Fee Agreement (Revocation) Regulations 2005 (SI 2005/ 2305) all previousCFA regulations were revoked as from November 1, 2005, leaving parties from that date toenter into CFAs on the basis of the primary legislation. Notwithstanding that he also notedthat there remained many points arising on the 2000 Regulations by reference to CFAsentered into prior to November 1, 2005. This appeal was concerned with such a case.

The defendants challenged the enforceability of the CFA, relying on a breach of the 2000Regulations. The point taken was similar to the point taken in Garrett,6 i.e. that there was afailure to comply with reg.4(2)(e)(ii) relating to the requirement to inform the client of any‘‘interest’’ the solicitors might have in recommending a particular insurer.

The claimant sought to distinguish Garrett but more significantly contended first beforeDistrict Judge Fairclough and on appeal from the district judge’s decision before HisHonour Judge Holman that reg.4 had been disapplied by the Conditional Fee Agreement(Miscellaneous Amendments) Regulations (SI 2003/1240) (the 2003 Regulations) and thatthe CFA concerned was a ‘‘CFA Lite’’ within those regulations.

6Garrett v Halton BC [2006] EWCA Civ 1017.



By the 2003 Regulations the 2000 Regulations were amended so as to insert a reg.3A inthe following terms:

‘‘3A—(1) This regulation applies to a conditional fee agreement under which,except in the circumstances set out in paragraph (5), the client is liable to pay hislegal representative’s fees and expenses only to the extent that the sums are recoveredin respect of the relevant proceedings, whether by way of costs or otherwise.

(2) In determining for the purposes of paragraph (1) the circumstances in which aclient is liable to pay his legal representative’s fees and expenses, no account is to betaken of any obligation to pay costs in respect of the premium of a policy taken outto insure against the risk of incurring a liability in the relevant proceedings.

(3) Regulations 2, 3 and 4 do not apply to a conditional fee agreement to whichthis regulation applies . . . . . . . . . . . ...

(5) A conditional fee agreement to which this regulation applies may specify thatthe client will be liable to pay the legal representative’s fees and expenses whetheror not sums are recovered in respect of the relevant proceedings, if the client—

(a) fails to co-operate with the legal representative;(b) fails to attend any medical or expert examination or court hearing which the

legal representative reasonably requests him to attend;(c) fails to give necessary instructions to the legal representative; or(d) withdraws instructions from the legal representative.’’

The 2003 Regulations came into force on June 2, 2003. However the CFA here was onewhich was in a form produced in 2001 and which purported to be an agreement complyingwith the 2000 Regulations. The CFA was dated June 19, 2003. It was sent to Mrs Jones onJune 2, 2003 under cover of the r.15 letter so it was pure chance that the 2003 Regulationsapplied, if they did. The main issue on the appeal was whether the CFA in this case fellwithin reg.3A.

The court had to decide whether the CFA made her Mrs Jones liable only for fees andexpenses that she would recover by way of costs ‘‘or otherwise’’ in accordance with themeaning of the words as used in reg.3A(i), and whether, in considering whether a CFA fellwithin reg.3A, regard should be had to the client care letter or to the CFA agreement alone.

The defendant argued that by using the word ‘‘recovery’’, it was clear that the words‘‘or otherwise’’ did not include insurance because ‘‘recovery’’ denoted recovery (in the costssense) from the claimant’s opponents. The claimant did not agree. Mrs Jones maintained thatthe terms of the CFA left her with no liability for any costs. The council argued that on theterms of the client care letter, Mrs Jones was liable to pay the client’s disbursements and thatthe language of reg.3A had therefore not been complied with.

The Court of Appeal held that in the CPR7 the words ‘‘recovery’’ and ‘‘recovered’’certainly related to recovery of costs from a party, but concluded that not much reliance

7For a CFA Lite the most important section is Pt 43.2(3) which states that where advocacy or litigation services areprovided to a client under a conditional fee agreement, costs are recoverable under Pts 44–48 notwithstanding that theclient is liable to pay their legal representative’s fees and expenses only to the extent that sums are recovered in respectof the proceedings, whether by way of costs or otherwise.



could be placed on the use of the word in reg.3A. They also held that there were no pointersto a requirement to place some constrained meaning on the words ‘‘or otherwise’’. Thatmeant there was no reason why, as a matter of language, ‘‘or otherwise’’ could not includerecovery under an insurance policy.

They concluded that the correct approach to construing a CFA agreement was to lookat the whole package produced by the solicitor: the CFA agreement, the client care letterexplaining the effect of the agreement and the insurance policy recommended by the solicitor.It then was necessary to ask whether the solicitor had produced an arrangement under whichthe client would not be liable for any own-side costs or expenses (apart from the circumstancesdefined by reg.3A(5) of the 2000 Regulations) other than those that were actually recoveredfrom the other side or from insurers.

They recognised that if a client remained liable for own-side costs and expenses in certaincircumstances, then unless the position was covered by reg.3A(5), the CFA would not bea ‘‘CFA Lite’’ and its enforceability would depend on whether reg.4(e)(ii) of the 2000Regulations had been complied with.

They held that the agreement in this case, correctly construed, was that there would be awaiver (except to the extent that there was recovery), either from a losing defendant or underan insurance policy so that Mrs Jones, unless she withdrew instructions, had no liability forcosts. Therefore the CFA here was a ‘‘CFA Lite’’. The appeal was allowed.

The court then went on to consider what the position would have been if the CFA hadnot been a ‘‘CFA Lite’’. Would it have complied with reg.4(e)(ii) of the 2000 Regulations?Did the solicitors have an interest?

The claimant tried to distinguish this case from Garrett on the basis that there was no termestablished that if the solicitors did not recommend this insurance their membership of thepanel would be terminated. It was suggested that there was evidence to support the fact thatthese solicitors did not, as a matter of course, recommend a CBUK policy.

The court held, that as far the evidence was concerned, it simply revealed that if thesolicitors discovered that a client had their own legal expenses insurance taken out prior tothe event, the solicitors would advise cancellation of the CBUK policy. They noted that italso confirmed that that did not harm the business relationship between solicitors and CBUK.

They commented that since one of the conditions on which CBUK accepted a proposalfrom a client was:

‘‘[. . ..]that I have not got pre-accident legal cover, e.g. legal expense cover on myhome or car insurance or with my trade union membership. . .’’

It was hardly surprising therefore that a cancellation in circumstances where the client hadsuch cover could be achieved without trouble.

Importantly the evidence did not reveal whether the solicitors had ever, in a situationwhere there was not legal expense insurance pre-event, advised a client not to continuewith CBUK ATE insurance but go to another insurer. The reality was that solicitors on theCBUK panel were required by the operations manual to use the CBUK’s precedents, i.e.r.15 letter and CFA, which include the recommendation of CBUK’s own policy.

The court concluded that it was an obvious inference not requiring any evidence that, ifsolicitors ignored the operation manual and recommended a different policy from CBUK,involving cancellation of the policy already entered into with CBUK, considerable damagewould be done to the solicitor’s business relationship with CBUK. An insurer in the positionof CBUK in addition to receiving premiums under the policy received fees for doing the



work that solicitors would otherwise do and ‘‘would not view lightly a solicitor on the paneladvising clients to go to different insurers’’. The case could not be distinguished from Garrett.

The decision in Garrett was not, at least so far as the Court of Appeal was concerned, basedsimply on the fact that there was a term under which membership of the panel could beterminated. The language of the judgment is in general terms saying as follows (para.97):

‘‘There was a close relationship between Websters and Ainsworth. Websters weredependent on Ainsworth for referrals of cases, although it is unclear to what extent.As Mr Morgan point out, cases are the life blood of solicitors. Profit generatedby cases is likely to be of greater significance to solicitors than commissions paidon insurance premiums, paid for ATEs in connection with CFAs. The indirectfinancial interest of maintaining a flow of work through membership of a panelof solicitors is greater than the direct financial interest in commissions paid forinsurance premiums. The advice to use the Ainsworth insurance product came in aCFA that it had apparently supplied to its panel solicitors and which bore its livery.’’

The Court of Appeal held that the solicitors in this case clearly had an interest and thefact that the CFA disclosed them to be on the insurer’s panel of solicitors was consideredinsufficient, having regard to the absolute terms in which they had suggested they had nointerest.

If the CFA had not been a ‘‘CFA Lite’’, they would have ruled that there had beennon-compliance with reg.4(e)(ii) because of the solicitors’ failure to disclose their interest andthe CFA would have been unenforceable.

Crane v Canons Leisure Centre (May, Maurice Kay and Hallett L.JJ. and ChiefMaster Hurst), December 19, 2007, [2007] EWCA Civ 1352, CA

Civil procedure—personal injury—legal advice and funding—costs—collectiveconditional fee agreements—conditional fee agreements—success fees—recov-erability on costs consultants fees

Collective conditional fee agreements; Legal expenses insurance; Personalinjury claims; Success fees

Rowley Ashworth were instructed under a collective conditional fee agreement to act forNicholas Crane in a personal injury claim made for an electric shock he received to his lefthand at work. The success fee under the CCFA was set at an uplift of 45 per cent on basecosts. Base costs were defined under the terms of the CCFA as charges for work done by oron behalf of Rowley Ashworth.

The claim was compromised but costs only proceedings were commenced. There weretwo issues on the appeal. The issue was simple. Were the costs incurred by the firm of costsconsultants employed by Rowley Ashworth to be treated as costs rather than disbursementsand therefore subject to a success fee?

In the definitions of base costs and disbursements in the CCFA, there was a distinctionbetween charges for work done by or on behalf of Rowley Ashworth and expenses that theyhad incurred on the client’s behalf.

The Court of Appeal held (Maurice Kay L.J. dissenting) that this was a distinction betweencharges by the solicitors themselves for work that they themselves did or were directly



responsible for and expenses that they incurred for the client, some of which were for otherpeople’s work that they were not directly responsible for and which they simply passed on tothe client at cost.

They held that work carried out by the costs consultants was undoubtedly solicitors’ work.It was the type of work that the solicitors were retained to do. They may have chosento delegate the work but never relinquished control of it and responsibility for it. Theclassification of the work carried out could not sensibly depend on whether the solicitorsdid the work themselves, whether they delegated it to another solicitor or whether theydelegated it to costs draftsmen who were not solicitors.

The result was that they held that the work done by the costs consultants was properlydescribed as work done ‘‘on behalf of the solicitors’’ and their fees were properly describedas base costs within the terms of the CCFA. From there it was a short step to award a successfee on those costs.

They pointed out that the fact that a single success fee was normally carried through intocosts proceedings, highlighted the underlying fact that success fees were mainly to compensatelawyers for other cases that they had lost, and thus encouraged them to take the risk ofreceiving no fee in cases that they may lose. They also recognised that, at the outset thesolicitors have to face a risk that their client’s claim would fail but that they may have toconduct costs assessment proceedings on a costs order in favour of the other party for whichthey would receive no payment.

Accordingly they held that there was no reason of principle that compelled the court torequire parties who had entered in to CFAs or CCFAs to address at the outset the risk ofcosts proceedings separately and there were no clear reasons of policy for that requirement.The appeal was allowed. The full success fee was recoverable throughout.

There are two sections of the transcript worthy of mention in particular. The scene wasset in this matter when May L.J. opened his judgment in paragraph one with these words:

‘‘This appeal has an unsavoury flavour to it. It does not concern the real disputebetween the parties. That dispute concluded more than two years ago when MrCrane’s personal injury claim for receiving an electric shock to his left hand atwork on 24th January 2002 was compromised on 10th August 2004 for an agreedpayment of £1,500 plus costs on a standard basis to be assessed if not agreed. It wasnot necessary, I believe, for Mr Crane to start proceedings to secure this agreement.

Since then, Mr Crane’s solicitors, Rowley Ashworth, and the defendants’ insurershave been arguing about costs which by now will have exceeded Mr Crane’s agreeddamages by more than ten times.

The further unsavoury feature is that this appeal is not about the costs of Mr Cranerecovering £1,500, but about the satellite costs of assessing those costs in the Part8 costs only proceedings begun for that purpose. This all arises in large measurebecause claims for personal injury in excess of £1,000 cannot be brought in the smallclaims track, as they should, since, in my view, the £1,000 should be substantiallyincreased; and because Mr Crane’s Union entered into a Collective ConditionalFee Agreement with Rowley Ashworth.’’

Maurice Kay L.J. at para.31:

‘‘I add this as a postscript. When the conditional fee system was introduced, itsoon became obvious that its novelty was producing unforeseen and sometimes



unwelcome results, some of which are apparent from the satellite litigation whichhas been generated. Some of the difficulties have been resolved or at least patchedup by amendments or judicial decision. Initially, it was not possible to form a reliableview of what was happening ‘on the ground’.

However, the time may now be approaching when the working of the system isripe for an in-depth review so that there can be ascertained the extent to which thesystem is enhancing or impeding access to justice and at what financial cost. I resistthe temptation to say more on merely anecdotal evidence.’’

It seems clear that if the Court of Appeal has their way there is much more to come.

Hall v Stone (Waller (V-P), Smith, Lloyd L.JJ,), December 18, 2007, [2007] EWCACiv 1354, CA (Civ Div)

Personal injury—road traffic accidents—low velocity impact collisions—costs—conduct—costs—small claims assigned to multitrack—allegations of dis-honesty and inflated claims—CPR Pt 44.3

Costs; Road traffic accidents

The three claimants, Mrs Jill Hall, her 12-year-old daughter Bryony and Miss Caroline Lynas,who was aged 17, were all travelling in Mrs Hall’s car on April 2, 2003 when it was struckfrom behind by a car driven by Mrs Kim Stone, the defendant.

The claimants’ car was stationary at the time and the defendant’s vehicle was moving atonly about four to five miles per hour. The impact was a minor shunt. Within a few days,Mrs Hall and Miss Lynas had consulted separate solicitors who claimed damages on theirbehalf from the defendant’s insurers.

The insurers admitted liability and, on April 10, offered to settle Mrs Hall’s claim for £750and Bryony’s for £350. In addition, the insurers offered to pay reasonable disbursements and£350 plus VAT towards costs. Miss Lynas was offered £700 and a similar contribution tocosts and disbursements.

Neither letter stated for how long the offer was to remain open and neither was headed‘‘without prejudice save as to costs’’ or gave any other warning to the claimants that theletters would be relied on in any future argument as to costs. At the time these offers weremade, each of the claimants was still suffering from symptoms caused by the accident andnone had yet consulted a doctor for medico-legal purposes and accordingly they rejected theoffers. No further offers were made by the insurer. Stone then alleged that the impact was soslight that it was impossible for the claimants to have sustained any physical injuries.

The claimants brought proceedings and their schedule of loss claimed £3,000, £1,250 and£2,750 respectively. Stone alleged that they were dishonest in their claims and had purposelyinflated their claims. The case was assigned to the multitrack. When Honour Judge Marstonhanded down of a judgment he dismissed any allegation of fraud or dishonesty and found forall three claimants awarding them £1,000, £400 and £699 respectively.

There were no offers on which Stone was entitled to rely upon. The judge held that theallegations of dishonesty were made at Stone’s own risk and Stone could have made a Pt 36payment in if she wished to protect herself on costs.



Stone submitted that she would not have mounted an attack on the honesty of the claimantsif the claims had all been within the small claims jurisdiction as the judge’s awards showedthey should have been. The judge went on to exercise his discretion and made a global orderfor costs that Stone should pay 60 per cent of the claimants’ costs to reflect the totality of thecase, the offers that were made and the conduct during the course of the case.

The claimants appealed and maintained that they were the successful party and there wasno reason why they should not get 100 per cent of their costs. The point arose on costsbecause of what can happen where claimants make claims and recover sums of £1000 orless and the defendants can establish that the claims were exaggerated so that they are triedinappropriately on the fast track or the multitrack at great expense. Then the defendant canseek to limit the costs recoverable from them to the fixed sums applicable to the small claimstrack.8

The Court of Appeal pointed out that what sometimes happens, and happened in this case,is that a defendant or more accurately insurers allege not only that the claim is exaggeratedbut that it is in fact dishonest. This case was about a very minor incident in which thedefendant’s car bumped into the back of the car in which the claimants were travelling andthe defendant’s insurers alleged that the impact was so slight that it was impossible for theclaimants to have suffered any physical injuries.

They alleged that the claimants were dishonest in making any claim to have been injured atall. The defendants obtained an engineer’s report in order to establish the extent of the forcesthat would be operating on those in the car with such a minor bump and expert medicalevidence so as to demonstrate that no real injury could have been caused by the accident.The Court of Appeal commented that these particular insurers appeared to be conducting aconsiderable campaign in relation to low velocity accidents, noting that the reports of theirexperts show all the signs of adaptation from already standard reports.

They recognised that the allegation of dishonesty is a serious one and with that allegationbeing made the district judge was bound to direct that the claims should be tried as amulti-track case. It was not clear whether without the allegation the claims as made wouldhave been fast track or multitrack; nor indeed was it clear whether if the claims had beenlimited to the sums ultimately awarded that the claims would simply have been allocated tothe small claims track but there was certainly some chance that they would have been.

CPR 26.8 sets out the matters to which the court should have regard when allocating,and the financial value of a case is the first matter. Where there are two or more claims thecourt does not aggregate the claims in considering the financial value. However the Courtof Appeal concluded that by pleading the claims the way they did, the claimants ensured thatthe claims would not be allocated to the small claims track.

The pleading might have led to the claims being multi track as opposed to fast trackeven without the serious allegation of fraud as opposed to bone fide over optimism, but thedefendant’s insurers’ allegation of dishonesty ensured a multi track trial and the increase incosts that that entailed. The fact that the case was multi track did increase the costs and withthe charge being made of fraud the period of trial was extended over some days. The resultwas that the most important issues at the trial were whether the claimants had brought adishonest claim or whether they had brought an exaggerated claim albeit honestly.

The Court of Appeal were that the costs of the claimants including solicitors’ success feewere in the region of £80,000; the costs of the defendants about half of that. If the case

8An example of this argument is provided by Devine v Franklin [2002] EWHC 1846 (QB) a decision of Gray J. who,on appeal from the decision of a district judge who had not accepted the argument, allowed the appeal. HoweverGray J. did not limit recovery to fixed costs exercising the discretion to award further costs where a party had behavedunreasonably (see CPR 27.14(2)(g)).



had been a fast track case without any issue as to dishonesty, they were told the claimants’costs would have been about £8,000–£10,000 and the defendants’ about £6,000. If the casehad been allocated to the small claims track then the fees would have in part been fixed andotherwise very much less than the fast track.

The Court of Appeal held that the judge erred in his approach to who was the successfulparty. He took conduct into account without specifying what conduct he had in mind orexplaining what effect it had had on proceedings. The judge was wrong to have taken theearly offers into account. That allowed them to exercise the discretion afresh.

They said that it would have been difficult for the claimants to accept the April 2003 offers.They had been made at too early a stage, before the claimants had had the chance to takemedico-legal advice. They held that it could not properly be held against these claimants thatthey refused those offers at that time.

If those offers had been held open until after the claimants had had the chance to recoverfrom their injuries and to seek medico-legal advice, and if the claimants had then rejectedthose offers, they held that the judge would have been entitled to penalise them on costs.

But that did not happen. The offers did not specify for how long they were to remainopen. There was no suggestion that they were available for acceptance in late 2003 when thefirst medical reports were to hand. The offers were never renewed. Of course the claimantsdid not come back to the insurers and ask if the offers could be renewed; nor did they makea counter-offer. This was specifically dealt with by Smith L.J. at para.83:

‘‘I do not think they can be criticised for that. When the appellants disclosed theirmedical reports, the portcullis came down and the drawbridge went up. The stancewas ’not a penny’. Accordingly, I would hold that the judge erred in regarding theappellant’s attitude to the April 2003 offers as something he could take into accountin reduction of their entitlement to costs’’.

Stone was ordered to pay all costs except those in relation to the first set of medical reportswhich were not relied upon. The three claimants were the successful parties. They ruled thata judge could not cut down the costs of the successful party under CPR r.44.3(4) merelybecause he had not done as well as he had hoped.

They also held that there was no conduct on the part of the three claimants which wasof such consequence as to warrant any reduction in their entitlement to costs. The initialexaggeration of their claims had no real effect on the costs of the action. Stone did not enjoyany partial success to entitle her to an abatement of those costs. Nor should the claimantssuffer any abatement on account of their attitude to the early offers which had been made attoo early a stage and which had not been held open until after they had obtained medico-legaladvice.

The appeal was allowed.


CUMULATIVE INDEX

Accidentsemployers’ liability

foreseeability, C7–C13Asbestos

causes of actionpleural plaques litigation, 1–15

Asbestosisemployers’ liability

causes of action, C45–C46, C46–C48

Benefitsfatal accident claims

measure of damages, C13–C19Birth defects

clinical negligencemeasure of damages, C23–C27

Brain damagecausation

reasonable care, C40–C44Breach of contract

asbestospleural plaques litigation, 1–15

damagesloss of chance, 31–45

Bullyingcriminal liability

employers’ liability, C4–C7Burden of proof

periodical payments ordersindexation for future loss, C50–C52

personal injury claimslow velocity road traffic accident, C35–C36

Causationbirth defects

measure of damages, C23–C27brain damage

reasonable care, C40–C44duty of care

sporting injuries, 16–25Causes of action


duty of caresporting injuries, 16–25

employers’ liabilityasbestosis, C45–C46, C46–C48

personal injury claimsoccupational stress, 26–30

Claim formsservice

extensions of time, C29–C33Claimants

road traffic accidentsdirect actions in victim’s domicile, 89–96

Client relationship managementrole of personal injury lawyer,

82–88

Clinical negligencebirth defects

measure of damages, C23–C27Collective conditional fee agreements

personal injury claimsrecoverability of costs consultants fees, C58–C59

Compensationasbestos

pleural plaques litigation, 1–15Conditional fee agreements

solicitor and client costsinterpretation of terms, C54–C58

Contributory negligenceaccidents

employers’ liability, C7–C13personal injury claims

low velocity road traffic accident, C35–C36road traffic accidents

motorways, C36–C38Costs

road traffic accidentsallegations of dishonesty and inflated claims,

C60–C62Counselling

role of personal injury lawyer, 82–88Credit cards

cross-border shopping, C1–C4Criminal liability

bullyingemployers’ liability, C4–C7

Cross-border shoppingcredit cards, C1–C4

Damagesloss of chance, 31–45

Defective productsproduct liability

substitution of parties after limitation period,C27–C29

Defencesduty of care

sporting injuries, 16–25Dependency claims

mesotheliomapre-existing condition, C48–C50

Direct actionsroad traffic accidents

victim’s domicile, 89–96Domicile

road traffic accidentsdirect actions in victim’s domicile, 89–96

Duty of carecauses of action

sporting injuries, 16–25

EC lawroad traffic accidents

direct actions in victim’s domicile, 89–96

[2008] J.P.I.L. ISSUE 1/08 SWEET & MAXWELL LTD AND CONTRIBUTORS

CUMULATIVE INDEX

Economic lossdamages

loss of chance, 31–45Employers’ liability

accidentsforeseeability, C7–C13


causes of actionasbestosis, C45–C46, C46–C48


Extensions of timeservice

claim forms, C29–C33

Fatal accident claimsmeasure of damages

overlap of damages, C13–C19Fatal accidents

fatal accident claimsmeasure of damages, C13–C19

Formsservice

extensions of time, C29–C33Forum non conveniens

United Statespharmaceutical product liability, 58–81

Funding arrangementssolicitor and client costs

conditional fee agreements, C54–C58Future loss

periodical payments ordersindexation, C50–C52

Harassmentbullying

employers’ liability, C4–C7Human rights

personal injuryeffect of forthcoming regulatory changes, 53–57

Indemnity basisPart 36 offers

libel, C52–C54Indexation

periodical payments, 44–52, C50–C52Industrial diseases


Insurance companiesroad traffic accidents

direct actions in victim’s domicile, 89–96Interpretation


Jurisdictionroad traffic accidents

direct actions in victim’s domicile, 89–96

Law firmspersonal injury

effect of forthcoming regulatory changes, 53–57Legal expenses insurance

personal injury claimsrecoverability of costs consultants fees, C58–C59

Legal historypersonal injury

effect of forthcoming regulatory changes, 53–57Legal services


Liability insuranceproduct liability


LibelPart 36 offers

indemnity basis, C52–C54Life expectancy

indexationperiodical payments, 44–52, C50–C52

Loss of chancedamages, 31–45

Loss of earningsbirth defects

measure of damages, C23–C27

Marinasoccupiers’ liability

risk assessment, C38–C40Material contribution

brain damagecausation of accident at level crossing,

C40–C44Measure of damages

clinical negligencebirth defects, C23–C27

fatal accident claimsoverlap of damages, C13–C19

periodical payments ordersindexation for future loss, C50–C52

personal injury claimslow velocity road traffic accident, C35–C36

Mental disorderrole of personal injury lawyer, 82–88

Mesotheliomadependency claims

pre-existing condition, C48–C50fatal accident claims

measure of damages, C13–C19Motor insurance

road traffic accidentsdirect actions under EC law, 89–96

Motorwaysroad traffic accidents

contributory negligence, C36–C38Multiple injuries

Ogden tablesmedical complications caused by obesity,

C20–C23

Negligencedamages

loss of chance, 31–45


CUMULATIVE INDEX

Noticesclaim forms

extensions of time for service, C29–C33

Obesitymultiple injuries

medical complications, C20–C23Occupational stress

personal injury claimscauses of action, 26–30

Occupiers’ liabilitymarinas

risk assessment, C38–C40Offensive behaviour

bullyingemployers’ liability, C4–C7

Ogden tablesmultiple injuries

medical complications caused by obesity, C20–C23

Part 36 offerslibel

indemnity basis, C52–C54Periodical payments orders

personal injuryindexations, 44–52, C50–C52

Personal injurybirth defects

measure of damages, C23–C27brain damage

causation of accident at level crossing, C40–C44burden of proof

low velocity road traffic accident, C35–C36duty of care

sporting injuries, 16–25employers’ liability

foreseeability, C7–C13fatal accident claims

measure of damages, C13–C19legal services

effect of forthcoming regulatory changes, 53–57occupiers’ liability

marinas, C38–C40periodical payments orders

indexation, 45–52, C50–C52product liability


road traffic accidentsdirect actions under EC law, 89–96

role of personal injury lawyer, 82–88Personal injury claims

burden of prooflow velocity road traffic accident, C35–C36

causes of actionoccupational stress, 26–30

collective conditional fee agreementsrecoverability of costs consultants fees, C58–C59

damagesloss of chance, 31–45

product liabilitysubstitution of parties after limitation period,

C27–C29

Pharmaceuticalsproduct liability

forum non conveniens, 58–81Pleural membrane


Precedentbirth defects

measure of damages, C23–C27Pre-existing condition

dependency claimsmesothelioma, C48–C50

employers’ liabilityasbestosis, C45–C46, C46–C48

Product liabilitypharmaceuticalsdefective products


forum non conveniens, 58–81Provisional damages

road traffic accidentsmedical complications caused by obesity, C20–C23

Psychiatric harmasbestos

pleural plaques litigation, 1–15employers’ liability

asbestosis, C45–C46, C46–C48personal injury claims

occupational stress, 26–30Public interest

forum non convenienspharmaceutical product liability, 58–81

Reasonable carebrain damage

causation of accident at level crossing, C40–C44Regulation


Risk assessmentoccupiers’ liability

marinas, C38–C40Road traffic accidents

costsallegations of dishonesty and inflated claims,

C60–C62jurisdiction

direct actions in victim’s domicile, 89–96motorways

contributory negligence, C36–C38personal injury claims

low velocity accident, C35–C36provisional damages

medical complications caused by obesity, C20–C23Rule of law


Scotlandbrain damage

causation of accident at level crossing,C40–C44


CUMULATIVE INDEX

Serviceclaim forms

extensions of time, C29–C33Solicitor and client costs

conditional fee agreementsinterpretation of terms, C54–C58

Solicitorspersonal injury

effect of forthcoming regulatory changes, 53–57role of personal injury lawyer, 82–88

Speed limitsroad traffic accidents

motorways, C36–C38Sporting events

duty of caresporting injuries, 16–25

Sportsduty of care

sporting injuries, 16–25

Success feespersonal injury claims

recoverability of costs consultants fees, C58–C59

Tortsdamages

loss of chance, 31–45

United Statesforum non conveniens

pharmaceutical product liability, 58–81

Very severe injuriesindexation

periodical payments, 44–52, C50–C52


journal of personal injury law

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