Cookson v Knowles

JurisdictionUK Non-devolved
JudgeLord Diplock,Viscount Dilhorne,Lord Salmon,Lord Fraser of Tullybelton,Lord Scarman
Judgment Date24 May 1978
Judgment citation (vLex)[1978] UKHL J0524-1
Date24 May 1978
CourtHouse of Lords
Cookson (Widow)
(Original Appellant and Cross Respondent)
and
Knowles
(Original Respondent and Cross Appellant) et è Contra

[1978] UKHL J0524-1

Lord Diplock

Viscount Dilhorn

Lord Salmon

Lord Fraser of Tullybelton

Lord Scarman

House of Lords

Upon Report from the Appellate Committee to whom was referred the Cause Cookson against Knowles et è contra. That the Committee had heard Counsel as well on Monday the 13th as on Tuesday the 14th and Wednesday the 15th days of March last upon the Petition and Appeal of Audrey Cookson (administratrix of the estate of Frank Cookson, deceased) of 3 The Grove, Chipping in the county of Lancaster praying that the matter of the Order set forth in the Schedule thereto, namely an Order of Her Majesty's Court of Appeal of the 3rd day of June 1977 and corrected under Order 20 Rule 11 of the Rules of the Supreme Court on the 29th day of July 1977 might be reviewed before Her Majesty the Queen in Her Court of Parliament and that the said Order might be reversed, varied or altered or that the Petitioner might have such other relief in the premises as to Her Majesty the Queen in Her Court of Parliament might seem meet; as also upon the Petition and Cross Appeal of Edward John Knowles of 17 Chaucer Street, Preston, in the county of Lancaster praying that the matter of the Order set forth in the Schedule thereto, namely an Order of Her Majesty's Court of Appeal of the 3rd day of June 1977 and corrected under Order 20 Rule 11 of the Rules of the Supreme Court on the 29th day of July 1977 so far as therein stated to be appealed against might be reviewed before Her Majesty the Queen in Her Court of Parliament and that the said Order so far as aforesaid might be reversed, varied or altered or that the Petitioner might have such other relief in the premises as to Her Majesty the Queen in Her Court of Parliament might seem meet; as also upon the Case of Audrey Cookson and also upon the Case of Edward John Knowles lodged in the said Original and Cross Appeals; and due consideration had this day of what was offered on either side in this Cause:

It is Ordered and Adjudged, by the Lords Spiritual and Temporal in the Court of Parliament of Her Majesty the Queen assembled, That the said Order of Her Majesty's Court of Appeal of the 3rd day of June 1977 and corrected under Order 20 Rule 11 of the Rules of the Supreme Court on the 29th day of July 1977 complained of in the said Original and Cross Appeals, be, and the same is hereby Affirmed, and that the said Original and Cross Appeals be, and the same are hereby, dismissed this House: And it is further Ordered, That there be no Order as to Costs in the said Original and Cross Appeals to this House save that the Costs incurred by Mrs. Cookson be taxed in accordance with the provisions of Schedule 2 to the Legal Aid Act 1974.

Lord Diplock

My Lords,

1

In the instant case the Court of Appeal, speaking through Lord Denning M.R., has laid down guide lines for the assistance of judges upon whom there falls the task of assessing damages in cases brought under the Fatal Accidents Act 1976. These complement some earlier guide lines for the assessment of damages in personal injury cases which had been laid down by the Court of Appeal in Jefford v. Gee [1970] 2 Q.B. 130. The trial in Jefford v. Gee had taken place at a time when the relevant statutory provision empowering courts to award interest on damages was section 3 of the Law Reform (Miscellaneous Provisions) Act 1934. By the time the appeal was heard that section had been amended by section 22 of the Administration of Justice Act 1969.

2

As was correctly stated by Lord Denning M.R. in Jefford v. Gee, the effect of the amendment was not to alter the principles which the court should apply when awarding interest on damages in cases where it decided to do so. What the amendment did was to oblige the court to award interest in all actions for personal injuries or fatal accidents unless it was satisfied that there were special reasons why no interest should be given.

3

The section as amended gives to the judge several options as to the way in which he may assess the interest element to be included in the sum awarded by the judgment. He may include interest on the whole of the damages or on a part of them only as he thinks appropriate. He may award it for the whole or any part of the period between the date when the cause of action arose and the date of judgment and he may award it at different rates for different parts of the period chosen.

4

The section gives no guidance as to the way in which the judge should exercise his choice between the various options open to him. This is all left to his discretion; but like all discretions vested in judges by statute or at common law, it must be exercised judicially or, in the Scots phrase used by Lord Emslie in Smith v. Middleton 1972 S.C. 30, in a selective and discriminating manner, not arbitrarily or idiosyncratically—for otherwise the rights of parties to litigation would become dependent upon judicial whim.

5

It is therefore appropriate for an appellate court to lay down guide lines as to what matters it is proper for the judge to take into account in deciding how to exercise the discretion confided to him by the statute. In exercising this appellate function, the court is not expounding a rule of law from which a judge is precluded from departing where special circumstances exist in a particular case; nor indeed, even in cases where there are no special circumstances, is an appellate court justified in giving effect to the preference of its members for exercising the discretion in a different way from that adopted by the judge if the choice between the alternative ways of exercising it is one upon which judicial opinion might reasonably differ.

6

If a discretion to differentiate in an award of interest on damages between one component of the full amount of the award and another is to be exercised judicially, this calls for an analysis of the nature and manner of assessment of the different kinds of loss and injury sustained in personal injury and fatal accident cases. Such an analysis was undertaken by the Court of Appeal in Jefford v. Gee. Although it was an action for personal injuries by a living plaintiff, the judgment of the court dealt also with fatal accident cases, though this could only be obiter.

7

The instant case is a typical fatal accident case. There are no special features about it that distinguish it from the general run of fatal accident cases so far as concerns awarding interest on damages. The deceased, the husband of the plaintiff, was killed in a motor accident in December 1973. He was then aged 49 and was in steady work as a wood-work machinist. Had he lived it would have been sixteen years before he reached the age of 65 when he would have qualified for a retirement pension and, in the ordinary course, might have been expected to cease working. The plaintiff was aged 45 and it was held by the Court of Appeal and is now common ground that her dependency at the date of death can be taken as £1,614 a year and that by the date of the trial in June 1976 the dependency as it would have been by then can be taken as £1,980 a year, owing to increases in wages during the two and a half years that had elapsed since December 1973.

8

The judge assessed damages by applying to the dependency at the date of trial which he had reckoned at £2,250 per annum a multiplier of eleven years purchase. This comes to £24,750. He awarded interest on the whole of that amount from the date of death until the date of judgment at 9%, the short term investment rate. This came to an additional sum of £5,412. In so doing, he was following the guide lines for fatal accident cases laid down obiter in Jefford v. Gee.

9

On appeal, the Court of Appeal varied those guide lines. They held that for the purpose of awarding interest on damages the damages should be divided into two parts, one assessed by reference to the assumed dependency during the period between the date of death and the date of trial, and the other by reference to the assumed future dependency from the date of trial onwards. On the former part, interest should be awarded at half the short term investment rate, but on the latter part in respect of future dependency no interest should be allowed. The court also took occasion, though this could only be obiter, to vary the guide lines for personal injury cases laid down in Jefford v. Gee by holding that damages for non-economic loss, i.e. pain and suffering and loss of amenities should be assessed on the scale at which such damages were currently being assessed at the date of trial, but that no interest should be allowed on this part of the damages. Both these changes were said to be required by reason of the increase in the annual rate of inflation since the decision in Jefford v. Gee.

10

My Lords, in general I agree with the judgment of the Court of Appeal in the instant case and, except in one respect, with the reasoning of that judgment and of the earlier judgment in Jefford v. Gee. Two separate though related questions are involved in the appeal to your Lordships' House. The first is whether and, if so, how should the prospect of continued inflation after the date of trial be dealt with in assessing the capital sum to be awarded by way of damages in fatal accident and personal injury cases. The second is whether in such actions, where there are no unusual circumstances, interest should be awarded on the whole or part of that capital sum and, if the latter, on what part.

11

When the first Fatal Accidents Act was passed in 1846, its purpose was to put the dependants of the deceased, who had been the bread-winner of the family, in the same position financially as if he had lived his natural span of life. In times of steady money values, wage levels and interest rates this could be...

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