Harris v Empress Motors Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE O'CONNOR,LORD JUSTICE ROBERT GOFF,LORD JUSTICE STEPHENSON |
| Judgment Date | 14 July 1983 |
| Judgment citation (vLex) | [1983] EWCA Civ J0714-3 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | 83/0317 |
| Date | 14 July 1983 |
[1983] EWCA Civ J0714-3
Lord Justice Stephenson
Lord Justice O'Connor
and
Lord Justice Robert Goff
83/0317
1979 H No. 6414
1981 C No. 37
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(MR. JUSTICE McCOWAN)
Royal Courts of Justice
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
LOWESTOFT DISTRICT REGISTRY
(MR. JUSTICE FORBES)
MR. C. WHITBY QC and MR. JULIAN HOOPER (instructed by Messrs. Edward Lewis & Co, Solicitors, London WC1R 4BW) appeared on behalf of the Defendants (Appellants) in appeal 1979 H No. 6414
MR. P. BENNETT QC and MR. J.V. ACTON-BOND (instructed by Messrs. Romain Coleman & Co, Solicitors, London E17 2AP) appeared on behalf of the Plaintiff (Respondent) in appeal 1979 H No. 6414
MR. MICHAEL OGDEN QC and MR. JOHN STEVENSON (instructed by Messrs. Hill & Perks, Solicitors, Norwich NR1 4DX) appeared on behalf of the Defendants (Appellants) in appeal 1981 C No. 37
MR. C. SUMNER (instructed by Messrs. Daynes Chittock & Back, Solicitors, Norwich NR3 1BD) appeared on behalf of the Plaintiffs (Respondents) in appeal 1981 C No. 37
These two cases raise questions on the assessment of damages where the court has to value the earning capacity of the injured person whose expectation of life has been shortened. In both cases the injured man had died as a result of injuries received in an accident caused by the negligence of the defendants. In the Harris case the action was brought under the Fatal Accidents Act 1976 for the benefit of the dependent widow and children and under the Law Reform (Miscellaneous Provisions) Act 1934 for the benefit of the estate. In the Cole case, as the parents had never married and the children were nearly grown up, the claim was in effect under the Law Reform Act alone. I will set out the relevant facts in each case.
The deceased died on 10th February 1978 from injuries received on 3rd February 1978. The deceased and his widow were both aged 29; they had married in 1969. There were two children, Nicholas born on 11th August 1974 and Timothy born on 22nd April 1978. The trial was at the end of January 1982. The learned judge approached the calculation of the damages under the Fatal Accidents Act in the conventional way and no criticism is made of the result, save as to the multiplier of 16 used by him. The judge found that the deceased would have earned £23,500 net during the four years to the date of trial. For the future he assessed a multiplicand of £7,000 per annum net, and gave 12 years' purchase, making a total of £84,000. The dependency of the widow and two children was agreed at 75 per cent. To the resulting figure of £80,625 there was added the funeral expenses and interest on the pre-trial assessment at an agreed rate, producing a total assessment under this head of £85,276.88. The judge apportioned that sum: Nicholas £7,500; Timothy £12,500; Widow £65,276.88.
The judge then assessed the Law Reform damages. The loss of expectation of life plus two small matters of special damage produced a total of £1,700; this is not challenged. That left the "lost years" calculation. The loss of net earnings were necessarily the same as under the previous calculation; he used the same multiplier to produce a total £107,500. From that sum there was to be deducted a sum to represent what I will for the moment call the deceased's living expenses. The correct assessment of this deduction is the real issue in these appeals. The judge came to the conclusion that the deduction should be the same as that made to produce the dependency under the Fatal Accidents Act, namely 25 per cent. In the result the total assessment under this head was £82,325.
The deceased died intestate; there was no estate except the Law Reform damages. The division of the estate under the intestacy produces the following result: the widow benefits in the sum of £57,000 (1st £25,000 plus 4 years' statutory interest; £7,000 plus value of life interest in half of the residue, £25,000). Nicholas and Timothy each benefit in the sum of £12,581.50 (one quarter of the residue each). It remains to set these sums against the Fatal Accidents Act assessments; those of Nicholas and Timothy are extinguished; that of the widow is reduced to £8,276.88. The result is that judgment was entered against the defendants for £82,325 under the Law Reform Act and £8,276.88 under the Fatal Accidents Act making a total of £90,601.88. There has been a duplication of damage in the sum of £5,325, the difference between the judgment and the Fatal Accidents Act assessment. The amount of this duplication can be varied up or down in a number of ways without any alteration in the assessment for loss of earnings at £23,500 and £7,000 per annum. A deduction of 50 per cent for living expenses produces a total judgment for only £225 more than the Fatal Accidents Act assessment. An increase in the apportionment of the Fatal Accidents Act award to the children will reduce the duplication. A reduction in the Fatal Accidents Act multiplier will have the same effect.
The deceased died on 24th July, 1979 from injuries received on 23rd July; he was 38 years old. There were two daughters, born in 1964 and 1965; they were the only Fatal Accidents Act dependents as the parents had never married, and it was accepted that the Fatal Accidents Act claim was bound to be extinguished by the Law Reform award. The parties agreed that if the parents had been married the dependency under the Fatal Accidents Act would have been 75 per cent and the multiplier 13 1/2. They agreed a figure for loss of earnings in the lost years at £84,000 in round figures, and the only matter for the learned judge was the amount of the deduction to be made for the deceased's living expenses. The learned judge decided 25 per cent and that is the only issue in the appeal.
Before I consider the main issue common to the appeals I will deal with two subsidiary submissions made by Mr. Whitby in the Harris case. The first submission was that the learned judge did not apportion a sufficient sum to the two children. The basis of this submission is a little evidence given by the widow in cross-examination that she might even consider private education for the boys as the husband had been anxious to do his best for the children. In my judgment the learned judge directed himself correctly at p.14 of the judgment that he should make an estimate of the genuine dependency of the children. He accepted a submission from Mr. Bennett that he should ignore the damages for the four years to the date of trial because the widow had kept the children at her own expense. I think that he was wrong to accept that submission because the children would have been dependent on the earnings of their father had he lived. The learned judge then assessed a multiplicand of £1,250 for each child and applied a multiplier of six for the 7 1/2 year old and ten for the 4 year old. When it is remembered that the total available multiplicand was £5,250, this was a generous apportionment. In my judgment £20,000 between the two boys was an adequate apportionment even if the four years to trial are taken into account. I would not have made so great a distinction between the two boys but it is a minor matter in the judge's discretion and we are not asked to vary it by the plaintiff.
The second submission was that the multiplier of 16 was excessive. Mr. Whitby relied upon the speech of Lord Diplock in Mallett v. McMonagle, (1970) Appeal Cases 166, where he said at p.177:
"In cases such as the present where the deceased was aged 25 and his widow about the same age, courts have not infrequently awarded 16 years' purchase of the dependency. It is seldom that this number of years' purchase is exceeded".
In Young v. Percival, (1975) 1 Weekly Law Reports 17, the court of appeal altered a multiplier of 12 to one of 14 where the deceased and the widow were 29 years old. Lord Justice Megaw said at p.22
"the multiplier of 16 contended for by the plaintiff is too high…. we think the right multiplier is 14. We reach this conclusion taking into account all the factors here including the ages of the deceased and of the plaintiff both of whom were approaching 30, the fact that the deceased had not been long established in his employment after a series of other employments and that it was employment in a trade, if that be the right word, where on the evidence the general prospects of continuing profitability were uncertain".
In the present case the deceased was a skilled electrician not a coach-tour salesman, and his earning capacity was not in doubt. I think that a multiplier of 16 was at the top for this case, but I cannot say that it was too high.
I come now to the main problem in these cases; how should the deduction which has to be made from the net loss of earnings for the lost years be calculated?
In the course of time the courts have worked out a simple solution to the similar problem of calculating the net dependency under the Fatal Accidents Acts in cases where the dependents are wife and children. In times past the calculation called for a tedious inquiry into how much housekeeping money was paid to the wife, who paid how much for the children's shoes etc. This has all been...
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