Hodgson and Others v Trapp and Another
| Jurisdiction | UK Non-devolved |
| Judge | Lord Mackay of Clashfern,Lord Bridge of Harwich,Lord Brandon of Oakbrook,Lord Oliver of Aylmerton,Lord Goff of Chieveley |
| Judgment Date | 10 November 1988 |
| Judgment citation (vLex) | [1988] UKHL J1110-3 |
| Date | 10 November 1988 |
| Court | House of Lords |
and
[1988] UKHL J1110-3
Lord Chancellor
Lord Bridge of Harwich
Lord Brandon of Oakbrook
Lord Oliver of Aylmerton
Lord Goff of Chieveley
House of Lords
My Lords,
I have had the advantage of reading in draft the speeches to be delivered by my noble and learned friends, Lord Bridge of Harwich and Lord Oliver of Aylmerton. I agree with both speeches and for the reasons given in them I too would allow the appeal on both grounds.
My Lords,
On 4 March 1982 the respondent plaintiff sustained catastrophic injuries in a road accident for which the appellant defendants admit liability. At the time of the accident the plaintiff was aged 33, a wife and mother and a woman of many talents and wide-ranging interests. It is unnecessary for the purpose of any issue arising in this appeal to describe in detail her pathetic condition as a result of the accident. It was graphically summarised by Taylor J.:
"[She] has been reduced to a vegetative existence. Her physical activity is minimal. Mentally she functions at the level of a young child. She is wholly dependant on others and will permanently remain so."
The judge awarded damages, inclusive of interest, in the sum of £431,840. The defendants now appeal from that award directly to your Lordships' House pursuant to the judge's certificate under section 12 of the Administration of Justice Act 1969 and by leave of the House. The appeal raises issues with respect to the judge's assessment of the elements included in the aggregate award as follows:
| Cost of care to date of trial | £ 53,871 |
| Future cost of care | £154,000 |
| Future loss of earnings | £ 75,123 |
Two distinct points of law arise for determination. First, in assessing damages to meet the expenses, past and future, of providing for the appropriate care of the plaintiff, the judge made no deduction in respect of the attendance and mobility allowances payable to the plaintiff pursuant to sections 35 and 37A of the Social Security Act 1975. He rightly held himself bound to disregard those allowances pursuant to the decisions of the Court of Appeal in Bowker v. Rose, The Times, 3 February 1978, Court of Appeal (Civil Division) Transcript No. 164 of 1978, C.A., and Gohery v. Durham County Council, (Unreported) on 26 April 1978, Court of Appeal (Civil Division) Transcript No. 236 of 1978, C.A. On the first point the present appeal is an invitation to the House to reverse those decisions. Secondly, having assessed the multiplicands for future cost of care and future loss of earnings and indicated that he considered multipliers of 13 and 11 respectively to be appropriate, the judge increased the multipliers to 14 and 12 to take account of the incidence of higher rates of taxation likely to be attracted by interest on the capital sum of his award. This was the course approved by the Court of Appeal in Thomas v. Wignall [1987] Q.B. 1098 and the correctness of that decision is also now called in question.
The basis of the statutory entitlement to attendance allowance under section 35 of the Act of 1975 is that the claimant is so severely disabled physically or mentally that he requires, by day, frequent, by night, prolonged or repeated, attention in connection with his bodily functions, or continual supervision to avoid substantial danger to himself or others. Thus the allowance is clearly intended to meet, in whole or in part, the necessary cost of care of a person as severely disabled as the plaintiff in the instant case, irrespective of the cause of the disability. The basis of entitlement to mobility allowance under section 37A is that the claimant is unable or virtually unable to walk but is in such a condition as to permit him to benefit from enhanced facilities for locomotion. Here again, the allowance is intended, subject to a point of detail which I must consider later, to contribute to the cost of care of a person who, like the plaintiff, cannot walk, in so far as that cost is incurred in providing means to alleviate the hardship of immobility.
It is necessary first to consider Daish v. Wauton [1972] 2 Q.B. 262. That was a case where the plaintiff, a boy of five, suffered severe injuries in an accident for which the defendants admitted partial liability. The boy was likely to spend the rest of his life in a National Health Service institution. In awarding a single global sum for general damages the trial judge substantially discounted the element representing future loss of earnings on the ground that the plaintiff's earnings would have been mainly spent in maintaining himself, whereas in the event he would be maintained by the State. The Court of Appeal increased the award to take full account of future loss of earnings on the ground that the benefit of free maintenance in a State institution was to be disregarded.
In Bowker v. Rose the trial judge, in awarding damages in respect of the cost of care of a severely incapacitated plaintiff, had declined to make any deduction in respect of attendance and mobility allowances payable under the Act of 1975. The leading judgment in the Court of Appeal affirming the judge's award was delivered by Roskill L.J. Having referred to passages from the speech of Lord Reid in Parry v. Cleaver [1970] A.C. 1 and from the judgment of Windeyer J. in National Insurance Co. of New Zealand Ltd. v. Espagne (1961) 105 C.L.R. 569, to both of which I shall have to refer later, he concluded that the key to the question whether the allowances were to be deducted lay in discerning the purpose of the legislation under which the allowances were payable:
"In my view," he said, "we should look at the relevant section and ask what is the purpose of this legislation. Is it a benefit conferred by the State upon the individual, so that the individual shall receive it when the event occurs which entitles him to it, irrespective of the cause of that event and irrespective of what other compensation he may receive to compensate him for his loss?"
On further consideration of the authorities, and in particular Daish v. Wauton [1972] 2 Q.B. 262, Roskill L.J. answered his own question in the affirmative. Having recited the argument in favour of deduction of the allowances in mitigation of damage, he concluded:
"I would reject the argument both in principle and on authority. I reject it in principle because I think that to give effect to it would be to ignore the purpose of this part of the relevant social security legislation. I would reject it on authority because I think that to accept it would fail to follow - as it is our duty in this court to follow - the decision in Daish v. Wauton."
Gohery v. Durham County Council (Unreported), another case involving attendance allowance, had been decided at first instance before the decision of the Court of Appeal in Bowker v. Rose, but came before the Court of Appeal some two months later. The court inevitably held themselves bound by Bowker v. Rose, though Ormrod L.J. expressed a doubt, with which I am inclined to agree, as to whether that decision followed necessarily from the earlier decision in Daish v. Wauton [1972] 2 Q.B. 262.
An ironic twist is added to the story by the enactment of section 5 of the Administration of Justice Act 1982, which reverses the effect of Daish v. Wauton, but does not touch the point at issue in the present appeal.
My Lords, it cannot be emphasised too often when considering the assessment of damages for negligence that they are intended to be purely compensatory. Where the damages claimed are essentially financial in character, being the measure on the one hand of the injured plaintiff's consequential loss of earnings, profits or other gains which he would have made if not injured, or on the other hand, of consequential expenses to which he has been and will be put which, if not injured, he would not have needed to incur, the basic rule is that it is the net consequential loss and expense which the court must measure. If, in consequence of the injuries sustained, the plaintiff has enjoyed receipts to which he would not otherwise have been entitled, prima facie, those receipts are to be set against the aggregate of the plaintiff's losses and expenses in arriving at the measure of his damages. All this is elementary and has been said over and over again. To this basic rule there are, of course, certain well established, though not always precisely defined and delineated exceptions. But the courts are, I think, sometimes in danger, in seeking to explore the rationale of the exceptions, of forgetting that they are exceptions. It is the rule which is fundamental and axiomatic and the exceptions to it which are only to be admitted on grounds which clearly justify their treatment as such.
The classic heads of exception to the basic rule are: (1) moneys accruing to the injured plaintiff under policies of insurance for which he has paid the premiums: Bradburn v. Great Western Railway Co. (1864) L.R. 10 Ex. 1; and (2) moneys received by the plaintiff from the bounty or benevolence of third parties motivated by sympathy for his misfortune: Redpath v. Belfast and County Down Railway [1947] N.I. 147. The reasoning relied on by courts in support of other exceptions has, I think, invariably been based on the application to a greater or lesser degree by analogy of the same reasons as are thought to justify the primary exceptions. These reasons were fully examined by Lord Reid in Parry v. Cleaver [1970] A.C. 1, 14. I ventured myself to suggest in Hussain v. New Taplow...
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