Lily Rose Crosset And Others V. Upper Clyde Shipbuilders Ltd (in Liq) And Another
| Jurisdiction | Scotland |
| Judge | Lady Dorrian |
| Neutral Citation | [2008] CSOH 97 |
| Court | Court of Session |
| Published date | 04 July 2008 |
| Date | 04 July 2008 |
| Year | 2008 |
| OUTER HOUSE, COURT OF SESSION [2008] CSOH | |
| OPINION OF LADY DORRIAN in the cause LILY ROSE CROSSETT AND Pursuers; against UPPER CLYDE SHIPBUILDERS LIMITED (IN LIQUIDATION) AND ANOTHER Defenders: ________________ |
Pursuers: Marshall, Solicitor Advocate; Thompsons
Defenders: N Mackenzie; Biggart Baillie
4 July 2008
[1] The pursuers are the executors and family of the late Edward Crossett who died from mesothelioma on 11 November 2005. The defenders are the successors of the rights and liabilities of Alexander Stephen & Son Limited, former employers of the deceased.
[2] When the case called before me for proof I was advised that the action, as far as relating to the second to sixth pursuers, had settled. So far as the first pursuers (the estate) were concerned, parties were agreed about all matters, save one. A joint minute of admissions was tendered in which the defenders admit liability to make reparation to the first pursuers and the parties agree (subject to the outstanding issue) damages in the sum of £70,000.
[3] The outstanding issue relates to a payment of £9,912 made to the deceased's estate under the Pneumoconiosis Etc. (Workers Compensation) Act 1979 and whether that should be deducted from the agreed damages.
[4] The joint minute narrates that the defenders are in liquidation and insolvent, that they were insured by Chester Street Insurance Holdings Limited (in Scheme of Arrangement) and that any sums which the first pursuers may eventually receive will be paid by the Financial Services Compensation Scheme ("FSCS" or "the scheme") in accordance with the Financial Services Authority Handbook, compensation section, which provides for payment under the scheme of a sum equivalent to 90% of a person's damages. In exchange for payment the first pursuers will be required to assigned to the scheme their whole rights against the defenders and their insurers.
Submissions for pursuer
[5] Counsel for the pursuers referred to various authorities (Mounkman on Damages 11th ed., Parry v Cleaver 1970 A.C. 1, Cantwell v CICB 2002 S.C. 1, Jobling v Associated Dairies 1982 A.C. 794 and Ballantyne v Newealls Insulation 2001 I.C.R. 25) but the principles taken from these cases were essentially ones of general application: namely that pursuers should be put as closely as possible in they position in which they would have been but for the defender's negligence. They should not be overcompensated but nor should they be undercompensated. I and that in relation to losses and benefits like should be compared to like.
[6]. Essentially the proposition for the pursuers was startlingly simple. The pursuers were not entitled to be over-compensated, hence in a simple issue with a wrongdoer the payment under the 1979 Act would require to be deducted. On the other hand a pursuers should not be under-compensated and should be put as closely as possible in the position they would have been in but for the defenders' negligence. In this case the effect of the scheme would in itself result in under-compensation since the pursuers require to accept a reduction of 10% in exchange for the assignation of their rights against the defenders. This under-compensation would be compounded if the 1979 Act payment were to be deducted. In that situation the court would grant decree for £60,088 of which the FSCS would pay only £54,079.20 (90%) in exchange for the assignations. The solicitor advocate for the pursuers submitted that such a result would be contrary to the principle that a pursuer should not be under-compensated and that in such a case as this the court required to look at all the circumstances before determining the amount for which decree should be granted. In particular, where the court was taking into account by way of deduction a payment under the 1979 Act, it should correspondingly recognise that the actual amount which a pursuer will receive under the scheme would be subject to a 10% deduction in terms of the scheme. In so far as deduction of the 1979 Act payment would produce for a pursuer a sum less than the damages agreed or determined by a court as appropriate, the court should not deduct the 1979 Act payment.
[7] Counsel drew my attention to the case of Ballantyne v Newealls Insulation Co Limited [2001] I.C.R. 25, an action in which the Court of Appeal held that as a matter of general principle, in order to avoid over-compensation, collateral benefits directly attributable to the injury which was the subject-matter of the cause were to be deducted from an award of damages. A payment under the 1979 Act was compensation for having the illness itself and the deceased having contracted it in circumstances to which the Act applied the payment was thus a collateral benefit directly attributable to the injury. It was therefore to be deducted from the damages which were to be awarded.
[8] The solicitor advocate for the pursuer did not take issue with the decision in that case, nor the reasoning on which it was founded. He accepted that it applied in any issue between a pursuer and a wrongdoer. His argument was that in a case covered, by virtue of the insolvency of insurers, by the Financial Services Compensation Scheme, the case of Ballantyne fell to be distinguished. In such a case there was no risk, as there had been in Ballantyne, of over-compensation, rather there was a risk of under-compensation. In assessing damages in such a case the court would require to look not...
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