Malyon v Plummer
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE SELLERS,LORD JUSTICE PEARSON |
| Judgment Date | 25 March 1963 |
| Judgment citation (vLex) | [1963] EWCA Civ J0325-1 |
| Date | 25 March 1963 |
| Court | Court of Appeal |
[1963] EWCA Civ J0325-1
In The Supreme Court of Judicature
Court of Appeal
From Mr. Justice Mocatts Middlesex.
Lord Justice Sellers
Lord Justice Pearson and
Lord Justice Diplock
Mr. MARTIN JUKES, Q.C. and Mr. KENNETS JUPP (instructed by Messrs. Smiles & Co., Agents for Messrs. Mossop & Bowser, Wisbech) appeared on behalf of the Appellant (Defendant).
Mr. DAVID CROOM-JOHKSON, Q.C. and Mr. RAYMOND KIDWELL (instructed by Messrs. Greenwoods, Peterborough) appeared on behalf of the Respondent (Plaintiff).
( Read by Lord Justice Pearson).
Mr. Justice Mocatta in this action was called upon to assess the amount of damages to which the plaintiff and the two children of the marriage were entitled by reason of the death of the husband and father, at the age of 41, caused by the negligent driving of a motor-car by the defendant. The damages were assessed at £17,348, of which £123 was an undisDuted figure for funeral and other expenses allocated to the claim under the Law Reform Act and. the balance of £17,225 represented the financial loss which the learned judge found to have been occasioned to the wife, suing on behalf of herself and the children, under the Fatal Accidents Acts.
The total financial benefit which the wife and children enjoyed prior to the death was £1,328. The learned judge increased that to no more than £1,375 on the prospect of some slight improvement in earnings in the future and on which sum he assessed the damages. This was on the basis that the wife and children were solely dependent on the husband for that sum.
The first ground of apueal is that in so finding the learned judge was wrong; that of the £1,328, the wife contributed £668 (being £800 less tax), and that £668 therefore ought to have been deducted from the £1,375, making the net figure for dependency £707 only.
There is no doubt where the money came from and how the wife received it. In 1955 a private company, P.P. Halyon Limited, was incorporated by the husband. The caoital was 1,000 £1 shares, of which he held 999 and his wife the other one. I read from the judgment at page 2: "The business was that of selling and distributing in East Anglia various commodities, consisting mainly of portable electrical machines. The company held one important sole distribution agency in the area for a concern called Grinding Improvements Ltd. and a number of other non-exclusive agencies. When the company started it held the sole agency I have mentioned and one non-exclusive agency. At the time of the deceased's death the number of non-exclusive agencies had increased to fourand the number of customers on the "books, mainly builders and farm machinery suppliers, was 480. The business can be described not inaccurately as a one-man business. The deceased went out early each morning in his car collecting orders and delivering machinery and other articles and returned home at about 7 p.m. He worked a six-day week. Apart from the work he did, the only other people working for the company were a Mrs. Nightingale, a typist who worked in the mornings dealing with correspondence, and tne plaintiff herself, who was the Secretary of the company and one of its two directors, the other being her husband". The business was successful but had reached about it maximum attainment on the basis on which it was being conducted.
Throughout each financial year the husband transferred money from the business to his private account with a bank, from which he paid money to his wife, including £10 a week for housekeeping expenses, and all outgoings. The wife had no bank account. At the end of each financial year, the 31st May, no dividend was declared (the share of the wife would not have attracted very much if it had been) but the husband, or, applying another answer the wife gave in evidence, the husband and wife, as directors, decided how the earnings so achieved should be allocated. The husband or the company was advised by an accountant and these allocations were no doubt based on other considerations than the wife's contributions of effort and endeavour to the business.
The judgment finds as follows: "The work done by the plaintiff was not only part-time, but essentially casual, without any set routine. Thus sne would sometimes answer the telephone, book orders, and help Mrs. Nightingale…with the correspondence. Occasionally she would pack and despatch articles to customers. The essentially casual nature of such work as she did is exemplified by the fact that after the purchase in April, 1959, of a caravan which was kept near the sea, she spent much of the school holidays with her children away from home and could thus give no assistance whatever in the business". Those findings were challenged by the appellant but in my viewwhen the evidence is regarded it supports and justifies them.,
The judgment at page 11 makes further findings. "The novel feature of the present case, distinguishing it from any previous authority to which I have been referred, is the creation of the so-called one-man company and its interposition between the earnings won by the husband and the receipt of part of them by the wife for use in the home. The work done by the wife in connection with the business was little more than nominal and on the facts here the payment of a sum to her by way of salary as a director instead of a direct payment by the husband out of a larger salary of his own was mere machinery, no doubt carrying independent tax advantages. It is not for me to say anything about the latter point which does not concern me here. Whilst the company is no doubt a separate legal entity, I can see nothing in the principle of Salomon v. Salomon (1897 Appeal Cases page 22), which prevents me from finding and holding, as I do, that the salary which the plaintiff received via her husband's bank account and which was used in purchasing pro tanto the benefits for the plaintiff and her children with which I have dealt, derived solely from the relationship of husband and wife between her and the deceased. That slary and the benefits it purchased were lost on the termination of the relationship by the death of the husband".
In the first year of trading the wife was credited with only £29, and later years were as follows: 1958, Husband £1,600, wife £600. 1959, Husband £1,450, Wife £600. 1960, Husband £1,800, wife £800. The husband died about the middle of the financial year ending 31st May, 1961.
In approaching the question involved I think it should be contemplated in regard to another contingency. If it had been the wife who had been killed, could the husband have successfully claimed dependency on her for £800 less tax, because that sum was shown to be allocated to her in the books of Malyon Limited? I think not.
In Monarch Steamship Co. Ltd. v. Karlshamns Oljefabriker (A) (1949 Appeal Cases, at page 232) Lord du Parcq made thesegeneral observations on damages; "I do not doubt the wisdom of the judges, who in Hadley v. Baxendale, and the many later cases which interpreted or explained that classic decision, have laid down rules or principles for the guidance of those whose duty it is, as judges or jurymen, to assess damages. When those rules or principles are applied, however, it is essential to remember what my noble and learned friend Lord Wright, and Lord Haldane in the passage cited by him, have emphasised, that in the end what has to be decided is a question of fact, and therefore a question proper for a jury. Circumstances are so infinitely various that, however carefully general rules are framed, they, must be construed with some liberality, and not too rigidly applied. It was necessary to lay down principles lest juries should be persuaded to do injustice by imposing an undue or perhaps an inadequate, liability on a defendant. The court must be careful, however, to see that the orinciDles laid down are never so narrowly interpreted as to prevent a jury, or judge of fact, from doing justice between the parties. So to use them would be to misuse them".
Essentially is it so under the Fatal Accident Act, 1846, section 2: "…every such action shall be for the benefit of the wife, husband, parent, and child of the person whose death hall have been so caused, and shall be brought by and in the name of the executor or administrator of the person deceased; and in every such action the jury may give such damages as they may think proportioned by the injury resulting from such death to the parties respectively for whom and for whose benefit such action shall be brought; and the amount so recovered, after deducting the costs not recovered from the defendant, shall be divided amongst the before-mentioned parties in such shares as the jury by their verdict shall find and direct".
In my opinion, the interposition of Malyon Limited, if that is how it should be regarded, does not prevent the court assessing truly the loss which the wife has suffered. The husband's business Malyon Limited has been-destroyed by the loss of the husband and it is clear that its revenue was, in substance,derived from him.
The decision in Salomon v. Salomon need not blind one to the essential facts of dependency and require a finding of fact which is contrary to the true financial position as distinct from an artificial or fictitious one.
Burgess v. Florence Kightingale Hospital (1955 1 Queen's Bench page 34S) was relied on by the appellant before the judge and before us but 1 find that a very different case which has no relevance in the present dispute. The wife might well have earned nothing if she had not been married or would not have earned it in that company or in that wa;y but then no question of dependency would have arisen. The question is what, if anything, did she in fact...
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