Maybe – Maybe not: Provisional Damages
February 25, 2022
Will Waldron QC expands on discussion of the important question of provisional damages discussed in September’s Newsletter.
In my opinion, there is a commonly held misconception surrounding provisional damages. It flows from a misunderstanding of the rationale in the case of Willson v MOD ((1991) ICR 595). Of course, Willson involved a man who suffered a nasty foot and ankle injury, which was thought likely to cause osteo-arthritis of sufficient severity to require surgery. Scott Baker J declined to make an award of provisional damages on the basis that arthritis was a gradual deterioration of a condition, seen in many cases, and in the circumstances in which Mr Willson found himself, was of insufficient severity to merit an award under section 32A of the Supreme Court Act 1981. Amongst other things, the Learned Judge said this:
‘In my judgment, many disabilities follow a developing pattern in which the precise results cannot be foreseen. Within a general band this or that may or may not occur. Such are not the cases for provisional damages. The courts have to do their best to make an award in the light of a broad medical prognosis………In my judgment, there should be some clear-cut event which, if it occurs, triggers an entitlement to further compensation.’
As a consequence of that judgement, some people believe that, in effect, arthritic deterioration will never be a trigger for an award of provisional damages. Not so. Each case must be looked at on its own facts. True enough, in broad terms, increasing pain from arthritis will likely not suffice for a provisional award but the potential consequence of the deterioration is also relevant and should not be overlooked.
Let us remind ourselves of what the Supreme Court Act actually says:
32A Orders for provisional damages for personal injuries
(1) This section applies to an action for damages for personal injuries in which there is proved or admitted to be a chance that at some definite or indefinite time in the future the injured person will, as a result of the act or omission which gave rise to the cause of action, develop some serious disease or suffer some serious deterioration in his physical or mental condition.
(2) Subject to subsection (4) below, as regards any action for damages to which this section applies in which a judgment is given in the High Court, provision may be made by rules of court for enabling the court, in such circumstances as may be prescribed, to award the injured person-
(a) damages assessed on the assumption that the injured person will not develop the disease or suffer the deterioration in his conditions; and
(b) further damages at a future date if he develops the disease or suffers the deterioration.
(3) Any rules made by virtue of this section may include such incidental, supplementary and consequential provisions as the rule-making authority may consider necessary or expedient.
(4) Nothing in this section shall be construed-
(a) as affecting the exercise of any power relating to costs, including any power to make rules of court relating to costs; or
(b) as prejudicing any duty of the court under any enactment or rule of law to reduce or limit the total damages which would have been recoverable apart from any such duty.
(The power of county courts to award provisional damages in s.51 of the County Courts Act 1984 is written in exactly the same terms.)
So, then, there must be:
- A Claimant who has suffered personal injuries;
- A chance; of
- A serious disease or deterioration;
- Within a defined period;
- That means the Court will exercise its discretion in favour of making an award of provisional damages.
The first of these is straightforward and needs no clarification.
The second has been the subject of numerous judgements but needs no more of an explanation than Scott-Baker J’s words in Willson that “to qualify as a chance it must be measurable rather than fanciful.”
Serious disease or deterioration has been the focus of more than one judicial examination so that:
In Willson, Scott-Baker said:
“The second question turns on the words “serious deterioration in his physical condition.” It is clear that, as drafted, the word “serious” appears to qualify the words “deterioration in his physical condition.” There is a question of how “serious” should be interpreted in the light of this section. On one view, “serious” could cover a wide range of circumstances from something not far beyond the trivial at the bottom end of the scale to something approaching the catastrophic at the top end of the scale.
In my judgment, what is envisaged here is something beyond ordinary deterioration. Whether deterioration is serious in any particular case seems to me to be a question of fact depending on the circumstances of that case, including the effect of the deterioration upon the plaintiff.”
In Allott v CEGB (1988, Unreported), Michael Davies J expanded on the topic by saying that ‘there should be some clear-cut event which, if it occurs, triggers an entitlement to further compensation.’
Roch LJ had this to say in Curi v Colina (CA The Times, 14.10.1998):
“The next question is whether the disease or degeneration which may occur in the future can be described as serious. This must inevitably be a question to be decided on the evidence in each case. A disease or a deterioration could be serious because of the effect on the activities and capabilities of the injured party, or because of its effect on his or her life expectancy, or because of its effect on his or her financial position.”
In Patterson v MOD ((2012) EWHC 2767 (QB)), Simon Brown J said that ‘……generally speaking, it appears to me desirable to limit the employment of this valuable new statutory power to cases where the adverse prospect is reasonably clear-cut and where there would be little room for later dispute whether or not the contemplated deterioration had actually occurred.’
Then there is the interesting case of Butler v MoJ ((2015) EWHC 3384 (QB)) in which Coe CJ, sitting as a judge of the High Court both declined to award provisional damages for the risk of amputation and made an award of provisional damages for the risk of CRPS, phantom limb pain or the risk that, if there was an amputation, it might lead to a failed stump post-operatively. In my opinion, Butler was a unique case and does not necessarily create any sort of precedent.
Dealing with the risk of amputation, the Judge said:
‘In respect of the 25 per cent (risk) of amputation, it seems to me that the fact of amputation itself in the event of a 70 per cent improvement in overall symptoms and function cannot properly be described in the context of this case as a serious deterioration. Of course, there would be the cosmetic defect and the need for a prosthesis, but the claimant currently has a painful, non-weight bearing cold and/or hot discoloured foot and needs an air-cast boot and usually crutches to mobilise.’
On one analysis, it is difficult to see quite how the loss of a limb, even if a person’s pain is improved, could be regarded as anything other than serious, particularly because there is always a risk in an amputation case that the pain is not improved at all; and, come what may, there will be a need for specialist equipment, prosthetics, single level accommodation and the like. The Judge approached this issue by making an enhanced award for the risk of amputation (which, in effect, was 25% of her ‘guesstimate’ of likely prosthetic costs) and then awarded provisional damages to abide the event that, inter alia, there might be a failed amputation. I would not like to have to unravel the quantification issues of this case should it ever get to that at a provisional damages hearing. That said, it is clear from the facts of Butler that it was an unusual set of circumstances.
The relevant period will be highly fact dependent. There is no cut and dried answer. For example, in a case involving syringomyelia, the risk will be lifelong whereas in an amputation case, it may be that, if an amputation is going to happen, it will happen within short compass, as was the case in Chewings v Williams ((2009) EWHC 2490 (QB)). There the risk was one of increasing pain in an ankle leading to a need for fusion, which was at risk of going wrong and leading to amputation. Three years was said to be appropriate.
That brings us to discretion and the factors the court will take into account when considering where the balance lies. Here, there are some useful comments in the cases of Allott, Curi and Chewings.
In Allott, Michael Davies J said ‘…. this point leads into the third aspect that I regard as particularly relevant to the exercise of this discretion, and that is weighing up the possibilities of doing justice by a once-and-for-all assessment against the possibility of doing better justice by reserving the plaintiffs right to return.’
Roch LJ suggested in Curi that:
“The section should be confined to those cases where to compensate for the condition for which there is a chance on the basis that it will occur would be unfair to the defendant and to leave the claimant without the opportunity to ask for further compensation should the condition, of which there is a chance, materialise would be unfair to the claimant.”
And in Chewings, Slade J said:
‘In my judgment, Mr Chewings’ situation is the very situation for which an award of provisional damages is entirely appropriate. It is in the interests of the parties to reach a settlement, but there is a real chance that further extremely serious physical damage will be suffered by Mr Chewings as a result of the accident.’
In my opinion, it is clear that, as caselaw on the question of provisional damages has developed, the courts have placed increasing amounts of weight on the question of the fairness – or perhaps unfairness would be a better way of putting it – of making a section 32A Order. In other words, how unfair would it be for a Claimant not to have the advantage of an award of provisional damages in any particular case weighed against the question of how unfair it would be to a Defendant if they were awarded.
So; what then, are the relevant questions to ask when it comes to provisional damages? One way of looking at any case is to ask this:
- Is there a more than fanciful chance of disease/deterioration at some time (definite or indefinite) in the future?
- Does that create a ‘clear and severable risk’ as opposed to a continuing deterioration, which amounts to a ‘clear-cut event’?
- Would the disease/deterioration, if it happened, be ‘serious’: what, amongst other things, would be its effect on activities/capabilities, life expectation or financial position?
- Would a once and for all sum, including a sum for the chance of the deterioration occurring, be unfair, taking account of the balance of unfairness between the parties?
- What is the relevant period over which a section 32A Order should last in this case? And
- Is the court likely to exercise its discretion in favour of an Order in light of the answers to the above?
Of course, in the type of catastrophic injury litigation with which I am involved, the usual risk arising in respect of which a provisional damages award is looked for is syringomyelia. In broad terms, the lifelong risk of a deterioration from a clinically significant syrinx is somewhere around 1% and the risk of developing one serious enough to affect breathing only 0.1% or so, depending on circumstances. If a Claimant wants a provisional damages order in that sort of case, they will almost certainly get it at court (see Kotula v EDF Energy ((2011) EWHC 1546 (QB). However, insurers can be highly reluctant to agree to it and many Claimants are willing to take forego the Order to see an end to the litigation, especially when seven figure sums are on the table. As Chris Barnes said in his excellent article on this subject (see September 28th 2021 newsletter), care needs to be taken in such a situation. One needs to be absolutely clear in spelling out what the consequences of settlement without provisional damages are to a Claimant and, importantly, to ensure that a detailed Note of that advice is taken.