FATAL ACCIDENT CLAIMS: A DEPENDANT’S LOSS OF EARNINGS CANNOT BE CLAIMED

In Rupasinghe -v- West Hertfordshire Hospitals NHS Trust [2016] EWHC 2848 (QB) Mr Justice Jay rejected a novel attempt to develop fatal accident damages so as to include future loss of earnings by a dependant.

KEY POINTS

  • A widow could not advance her claim for loss of her own earnings following her husband’s death.
  • The claimant attempted to frame the claim as part of the loss of services claim. However it was not. In reality it was an independent claim for loss of earnings.

THE CASE

Mr Rupasinghe was killed as a result of the defendant’s (admitted) negligence.  Consequently his wife, Dr Rupasinghe, returned to Sri Lanka with her young family.  The judge found that the move to Sri Lanka was a reasonable one (it enabled Dr Rupasinghe to be with her family).  The majority of the damages were agreed.  The issues in dispute related to claim by Dr Rupasinghe for her own loss of income and pension as a result of her husband’s death.

THE ISSUES IN DISPUTE

    1. Proceedings were issued in due course, and the usual claims advanced under the 1934 Act and the 1976 Act. All bar three of these claims have been agreed, but the Claimant’s Schedule warrants some analysis. Specifically:
(i) Item 2.6 is a claim for “Past Earnings Dependency (the Claimant’s loss of earnings)”. It is pleaded that “as a result of his death, the Claimant has had to make substantial changes to her career [misspelt in the Schedule] and has suffered a loss of earnings and pension as a result”. Instead of being able to pursue a relatively remunerative career as a doctor in the UK, leading to a consultant position in the fullness of time, the Claimant has had to accept much less valuable employment in Sri Lanka. Under item 2.6 of the Schedule, the claim is for the difference. The Schedule pleads a loss of £118,503.19.
(ii) Item 2.7 is a claim for “Future Earnings Dependency (the Claimant’s loss of earnings)”. Analytically, this case proceeds on the same basis as item 2.6, and takes the position from the date of trial to the date of the Claimant’s notional retirement as a doctor in the UK. The Schedule pleads a loss of £1,257,678.73.
(iii) Item 2.8 is a claim for “Future Pension Dependency (the Claimant’s loss of pension)”. The claim under this rubric is in respect of pension loss from the date of notional retirement over the balance of the Claimant’s life expectancy. The Schedule pleads a loss of £437,260.59.

THE CLAIMANT’S ARGUMENTS

The claimant’s arguments were somewhat ingenious.  It was argued that the claimant’s loss of income (which would not be recoverable under normal fatal accident principles) had “necessarily arisen” in order to access gratuitous care. That was the claimant’s income had reduced because she needed to move to Sri Lanka to get support from her family.

THE JUDGE’S DECISION

The judge rejected the claimant’s claim for her own loss of earnings and pension.
    1. It is axiomatic, and in any event well established by cases such as Malyon v Plummer (see paragraph 25 above), that a free-standing claim for loss of earnings falls outside the scope of section 3 of the Fatal Accidents Act 1976. This is because such a claim does not relate to the loss of a benefit which would have accrued to the Claimant had the Deceased survived. The Act is only concerned with losses which flow from what the Deceased did when alive: either by the making of a financial contribution to the household, or by providing childcare and similar services (capable, under the common law, of being accorded a financial value).
    2. The Claimant does not seek to question or subvert these principles. The key issue, in my judgment, is whether on the particular facts of this case the disputed items do form part of the services dependency claim.
    3. Ordinarily, the court approaches the quantification of a services dependency claim by considering the cost of replacing the services formerly provided by the Deceased. In some situations, it is appropriate to approach this exercise by looking to the cost of furnishing commercial care in the form of nannies, au pairs, child-minders or the like. In other situations, the claim is in essence one for gratuitous care, and the authorities make clear that commercial rates fall to be discounted to reflect that. In the instant case, the Claimant is claiming for commercial care and for gratuitous care, albeit the latter is not being provided by herself. It is being provided by other family members, in particular by her parents. This is nothing inimical to principle in the Claimant advancing claims both for commercial and gratuitous care, but the observation falls to be made that all angles have been covered.
    4. As we have seen from the line of authorities previously discussed, the courts have followed an alternative approach. In appropriate situations, the court values the services formerly provided by the deceased with reference to the earnings foregone by the claimant in order now to furnish these services herself or himself. This is not a claim for loss of earnings in the strict sense; it is a claim for loss of services but using the surviving partner’s earnings as a proxy or surrogate measure for the value of the services foregone.
    5. The precise constraints on this alternative principle have not been set forth in the authorities, although there is general recognition that the claim must be reasonable. Whether this means that the sole issue for the court to consider is the reasonableness of the claimant giving up work, or whether a further issue arises as to the reasonableness of the quantum of the claim, having regard to the financial cost of commercial and/or gratuitous care, is I can see open to debate. I have resolved the first of these issues in the Claimant’s favour, but I have not yet addressed the second.
    6. In all the cases drawn to my attention by Mr Bebb, save for Cresswell v Eaton (paragraph 32 above) where the services in question were now being provided by an aunt who had to give up work, the surviving spouse or partner gave up work in order to provide the services formerly given by the deceased. Mr Bebb submits that the absence of this factual feature here is to his forensic advantage, but I disagree. The services dependency claim has already been valued, and compromised, on the basis of commercial and gratuitous care. In my judgment, there is nothing left to value. The disputed items do not constitute an attempt by the Claimant, applying some form of proxy measure, to value the loss of the Deceased’s services, but rather a broader endeavour predicated on reasoning that the Claimant has lost her career because of her husband’s untimely death. That is, of course, correct as a matter of fact, but it does not avail her as a matter of law. Seen in these terms, the claim is indeed one for loss of earnings, not one attributable to any need to replace a service that the Deceased had formerly been providing. The submission that Mr Bebb has to advance to avoid the charge of double-recovery, namely that the Claimant is not seeking to value her own services by applying a proxy measure, is a submission that fatally undermines his case. Loss of earnings can only be deployed as a proxy measure in respect of the services the surviving partner is now providing herself or himself in substitution for the services previously supplied.
    7. The situation is not improved from the Claimant’s perspective by contending that the disputed items form part of the services dependency claim and are inextricably intertwined with it, or amount to a loss of income that has necessarily arisen in order to access gratuitous care, or that this in reality is a claim for loss of earnings and gratuitous services, being an example of pecuniary loss suffered by a dependant. All these formulations tend to circularity, and fail to explicate the real question.
    8. In my view, it is unnecessary to address the reasoning in some of the early cases culminating, in point of time, with Watkins v Lovegrove. The only case drawn to my attention where the court allowed claims for loss of earnings as well as for the cost of care is Steel v Basu (on my reading of his judgment, Robert Goff J did not do so). These were all cases decided before the Court of Appeal tightened and formalised the quantification exercise in cases such as Harris v Empress Motors, Housecroft v Burnett and Coward v Comex, and they hark back to an era where experienced judges in claims for personal injuries and under the Fatal Accidents Act adopted a more fluid and discretionary approach. I rest on the fact that in all these cases the person giving up work did so in order to provide the relevant care herself or himself, and that the loss of earnings was envisaged as a proxy measure for the loss of services dependency. Put another way, if these factors are missing, it may not be said that the necessary link between the claim and the loss of dependency is made out.
    9. In my judgment, therefore, the disputed items are irrecoverable because: (i) the Claimant has already advanced a comprehensive services dependency claim which leaves no room for supplementation; (ii) the services dependency claim has, therefore, been compromised (I should make clear that I would not have found (ii) without (i)); (iii) the disputed items do not constitute a proxy measure for any loss of services now provided by the Claimant; and (iv) the disputed items do, therefore, constitute an independent claim for loss of earnings. It may be seen that all of these matters are inter-related, and that (i) and (iii) are key.
    10. I reject the possibility of apportioning the claim for “earnings dependency” (see the disputed items, as per the Claimant’s Schedule) as between earnings and services. If I have correctly understood Manning, Stadlen J countenanced the possibility of such an exercise. In my judgment, it is wrong in principle; and in any event I lack the means and evidence to undertake it.
    11. For the avoidance of doubt, I am not deciding this case on any free-standing basis that the disputed items have been compromised by agreement. I have made clear that item (ii) (see paragraph 54 above) flows from item (i) and would not have been reached in isolation. I note that there was agreement at the Bar that it was made clear at a round-table meeting that the disputed items were being advanced as part of the services claim.
    12. I am not ruling out the possibility of bringing simultaneous direct and proxy claims on certain hypothetical facts, but I am on these particular facts. My reasoning would apply to any case where is it clear that the direct claim – for commercial and gratuitous care – covers the whole of the conceivable ground.
    13. Although I have found as a fact that the Claimant acted reasonably in returning to Sri Lanka, I am making no finding as to whether her claim, which I have rejected in principle, is reasonable in amount and/or is subject to some sort of Housecroft v Burnett “ceiling”. It is unnecessary to address Miss Bradley’s alternative submission, particularly in circumstances where the quantum of the disputed items has not been fully investigated.
Conclusion
  1. For the reasons I have given, I find for the Defendant in relation to the disputed items. Subject to Court approval, there will be Judgment for the Claimant in the sum of £335,000.”
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