Jefford v Gee
|England & Wales
|THE MASTER OF THE ROLLS
|04 March 1970
|Judgment citation (vLex)
| EWCA Civ J0304-2
|04 March 1970
|Court of Appeal (Civil Division)
 EWCA Civ J0304-2
The Master of the Rolls (Lord Denning)
Lord Justice Davies and
Lord Justice Salmon
In The Supreme Court of Judicature
Court of Appeal
Appeal of Defendant from Judgment of Mr. Justice Waller on 16th June, 1969.
MR JOHN STOCKER, Q.C. and MR MICHAEL TURNER (instructed by Messrs. L. Bingham & Co) appeared on behalf of the Appellant (Defendant).
MR RAYMOND KIDWELL, Q.C. and MR JOHN HAYMAN (instructed by Messrs. W.H. Thompson) appeared on behalf of the Respondents (Plaintiffs).
MR JOHN MAY, Q.C and MR JOHN NEWEY (instructed by The Official Solicitor) appeared as Amici Curiae.
Lord Justice Salmon cannot be here this morning but he has prepared with us the judgment which I am about to read, which is the judgment of the Court.
On 30th November,1966, Mr. Jefford was riding his motor-scooter along Archway Road in North London. Mrs. Gee drove her motor-car so negligently that she ran into him and knocked him off the scooter. His head was badly cut. Three teeth were knocked out. He had a broken wrist. But, worst of all, he had a badly broken right leg. He has had many operations for it but has never recovered the full use of it. He has been off work a long time.
On 25th July, 1967, the plaintiff issued a writ claiming damages. Liability was admitted. The defendant paid into Court £4,250 in satisfaction of the claim. The plaintiff did not take it out. The trial was held on 16th June, 1969. The Judge awarded a sum of £5,631.lls.6d. It was made up as follows:-
|£3,500. Cs. 0d.
Mr. Kidwell, Counsel for the plaintiff, asked for interest on the whole or part of the sum awarded. The Judge allowed no interest on the Special Damages, But he allowed interest at per annum on the General Damages of £3,500 for 2½ years, that is, from the date of the accident, 30th November, 1966, to the date of trial, 16th June, 1969. The total interest came to £568.15s. Od.
The defendant appeals from this award of interest. The notice of appeal says that no interest at-all should have been awarded on the general damages: or, alternatively, it should not have been allowed on so much of it as represented loss of prospective future earnings: and, in any case, the period of 2½ years was too long: and the rate of 6½% was too high. The notice of appeal also complains that the award of interest took no account of the defendant's payment into Court.
The plaintiff cross-appeals asking that interest shall be awarded on the whole of the damages, including the special damages as well as the general damages. The plaintiff also asks that therate should be higher than 6½%.
The appeal and cross-appeal raise the question: On what basis should interest be awarded in personal injury cases? This question is of especial importance: because, since 1st January, 1970, Parliament has made it compulsory for the Judges to award interest in personal injury cases. But, in making it compulsory, Parliament has, quite understandably, left it to the Courts to decide the principles on which they should act. So we have given urgent consideration to it. The question stands out: How is the Statute to be applied? Up and down the country people want to know the answer. Trade unions, insurers, accountants, solicitors, barristers, all want to know. Scores of cases have already come before the Judges. Each has given a different answer. As the Latin saying has it, Quot homines, tot sententiae, which means, put into English: "Count the number of men; then the number of different opinions; and you will find there are as many different opinions as there are men". Such is the confusion that we feel it our duty to set out the guide lines, even though in some respects our observations may be obiter dicta. In this task we sought the assistance of the Official Solicitor, who instructed Mr. John May, Q.C. and Mr. Newey, as friends of the Court. Their assistance has been invaluable to us.
2. THE STATUTES
The power of the Court to award interest in these cases was contained originally in Section 3 of the Law Reform (Miscellaneous Provisions) Act, 1934. It said:
"(1) In any proceedings tried in any Court of record for the recovery of any debt; or damages, the Court may, if it thinks fit, order that there shall be included in the sum for which judgment is given, interest at such rate as it thinks fit, on the whole or any part of the debt or damages for the whole or any part of the period between the date when the cause of action arose and the date of the judgment provided that nothing in this section shall authorise the giving of interest upon interest".
It should be noticed that the power of the Court was then discretionary. But, since 1st January, 1970, it has become compulsory in personal injury cases. This is by reason of Section 22 of the Administration of Justice Act, 1969, which adds thesesub-sections to the above sub-section (1):-
"(1A) Where in any such proceedings as are mentioned in sub-section (1) of this Section, judgment is given for a sum which (apart from interest on damages) exceeds £200 and represents or includes damages in respect of personal injuries to the plaintiff or any other person, then (with- out prejudice to the exercise of the power conferred by that sub-section in relation to any part of that sum which does not represent such damages) the Court shall exercise that power so as to include in that sure interest on those damages or on such part of them as the Court considers appropriate, unless the Court is satisfied that, there are special reasons why no interest should be given in respect of those damages.
(1B) Any order under this section may provide for interest to be calculated at different rates in respect of different parts of the period for which interest is given, whether that period is the whole or part of the period mentioned in sub-section (1) of this Section".
The present case of was tried on 16th June, 1969. So it is governed solely by the 1934 Act. But our decision today in will, we think, be applicable also to cases which are tried after 1st January 1970. These will be governed, of course, not only by the 1934 Act but also by the 1969 Act. But the 1969 Act does not alter the' principles which the Court should apply in awarding interest. All it does is to oblige the Court to apply those principles. It was suggested that the words "such part of them as the Court considers appropriate" indicate some different principles. But we do not think so. They only express the same principles as in the 1934 Act, but in different words. It should be noticed, too, that the 1969 Act is retrospective, in this sense, that, it applies to all personal injuries, no matter how many years ago, so long as the case comes for judgment after 1st January 1970. We were told that the insurance companies find this embarrassing because their premiums were calculated in the past without regard to interest. The addition of compulsory interest on past injuries puts everything out.
3. THE PREVIOUS LAW
Every Statute has to be considered with reference to the previous law and the state of the earlier authorities. Theseshow that the 1934 Act was intended to give effect to a principle enunciated by Lord Herschell, the Lord Chancellor in 1893. So we will traceit out.
(i) At Common Law
The rule of the Common Law of England was that, in the absence of express agreement, interest could not be recovered on a debt or damages: and Equity in this respect followed the law. This situation was regretted by many great Judges. In regretting it, they stated the principle which the Courts ought to apply. Thus in 1826, Chief Justice Best said:-
"………However a debt is contracted, if it has been wrongfully withheld by a defendant after the plaintiff has endeavoured to obtain payment of it, the jury should be able to give interest in the shape of damages for the unjust detention of the money" see ; Redfern
In 1893 in , Lord Herschell, Lord Chancellor, stated the principle, which he thought should be applied, in these words (at page 437):-
"I think that when money is owing from one party to another and that other is driven to have recourse to legal proceedings in order to recover the money due to him, the party who is wrongfully withholding that money from the other ought not in "justice" to benefit by having the money in his possession and enjoying the use of it, when the money ought to be in the possession of the other party who is entitled to its use. Therefore, if I could see my way to do so, I should certainly be disposed to give the appellants, or any body in a similar position, interest upon the amount withheld from the time of action brought at all events".
(ii) The Acceptance of the Principle
The principle thus stated by Lord Herschell was set out in its entirety by the Law Revision Committee in its Report which led to the 1934 Act (Command Paper 4546 in 1934). That very distinguished committee accepted the principle, and said:- (in paragraph 8)
"………In practically every case a judgment against the defendant, means that he should have admitted the claim when it was made and have paid the appropriate sum as damages. There are, of course, some cases when it is reasonable that he should have had a certain time for investigation, and"in those cases the Courts might well award interest only from the date when such reasonable time had expired".
The Committee go on to say (in paragraph 9) that this principle should apply not only to special damages for tort but also to...
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