Damages for Personal Injury in Scotland – change is afoot

The Scottish Law Commission (“SLC”) has published its 226 report, which focusses on reforms to the law of damages for personal injury claims in Scotland. The report itself is 135 pages long and it is well worth considering in full.          

This note is a snapshot of the key recommendations within the report, with more substantive analysis of the various recommendations to follow.       

The purpose the SLC’s report is to (i) modernise and clarify the law; (ii) increase access to justice; (iii) remove unfairness in the current law; and (iv) facilitate and make more transparent the calculation and management of personal injury damages. Here are some of the key recommendations.

1. Damages for services

The Administration of Justice Act 1982 (“the 1982 Act”) is now over forty years old. This Act governs what damages can be recovered for personal and necessary services provided to, or by, a relative of the injured person. It is the definition of “relative” which the SLC suggest requires reform on the basis that it does not reflect the reality of a modern society.

The purpose of the recommendation is to expand the fairly narrow definition of a relative in the 1982 Act which, as it stands, only extends to the spouse or divorced spouse or any person, not being the spouse of the injured person, who was, at the time of the act or omission giving rise to liability in the responsible person, living with the injured person as husband, wife or civil partner.              

Should this recommendation be brought into law it would expand the class of persons potentially eligible receive damages, on the basis of the injured party claiming on their behalf under s.8 & s.9 and then accounting to them. This could lead to an increase in value for services claims in the future.

2. Deductions from damages

The SLC also proposes to clarify whether any payment under an employer’s health insurance scheme should be deducted from the injured person’s damages for wage loss under s.10 of the 1982 Act. This being the section which regulates what can and cannot be deducted from any award of damages. The SLC’s concern lies in the differing approaches taken by Courts in Scotland, England & Wales on this issue, with the Scottish decision in Lewicki v Brown & Root Wimpey Highland Fabricators Ltd, 1996 conflicting with the English decision in Gaca c Pirelli General Plc, 2004.

The SLC also proposes that the law be amended to make clear that an injured person is entitled to opt for medical treatment, care, accommodation, and equipment on a privately paid basis, rather than being obliged to rely on NHS or local authority support.

This proposal seeks to address a potential mitigation of loss point. Section 2(4) of the Law Reform (Personal Injuries) Act 1948 directs that the Court shall disregard the fact that an injured person opted for private, instead of NHS, medical in considering whether they have taken reasonable steps to mitigate their loss.

However, there is no such corresponding provision for private care or accommodation costs. This lacuna potentially leaves an injured person who opts for private sector care and accommodation open to a mitigation of loss point if there was a local authority or NHS funded care / accommodation package available to them.

3. Provisional damages for asbestos related diseases

The Damages (Asbestos-related Conditions) (Scotland) Act 2009 provides that pleural plaques, asymptomatic pleural thickening and asymptomatic asbestosis constitute actionable harms in Scotland, for which damages are recoverable, even though the conditions are symptom-free. This has caused limitation issues for claimants. Unless a claim is brought within three years of diagnosis, the right to bring the claim is lost, even if the claimant becomes symptomatic after this point.

Whilst an earlier action, settled on a provisional basis, may protect the injured person from the time-bar of the later more serious condition, the SLC considers that many injured persons with pleural plaques do not bring a claim for a variety of reasons. Its proposal is that the failure to pursue an asymptomatic condition such as pleural plaques will no longer result in a time-bar preventing recovery of damages for a later developing symptomatic condition, such as mesothelioma.                        

If enacted, this proposal may well change the risk profile for certain asbestos claims.                   

4. Managing awards of damages to children

As it stands, claims involving children are required to be brought in the name of their parent or guardian, until the child reaches the age of legal capacity (16) to bring the claim in their own name.

The SLC was concerned that awards of damages to children may be vulnerable to ill-advised investment or misappropriation. Its recommendation is that, before any award of damages is made, the Court ought to have a duty to enquire how the award will be invested, protected, and administered and, if necessary, refer the case to the Accountant of Court.          

The SLC provides a non-exhaustive list of factors that the Court should take into account, such as the level of the award and the future care needs of the child. The Court should also have due regard to (i) the welfare of the child, (ii) the “no order” principle well-known in family law cases and (iii) the views of the child when considering how awards of damages made to a child should be managed.      

The aim is for increased supervision by the courts where damages are awarded to children which, in the writer’s view, is a welcome step. How this will be reconciled with damages-based agreements, where the claimant’s agents take a percentage of an award of damages, is unclear and will require further legislative scrutiny if the purposive aim is to act in the best interests of the child.

Summary   

The proposals brought forward seek to address gaps in the law. However, its potential impact upon compensators cannot be understated and may directly impact the cost of claims.  In particular. The proposals will change how asbestos related litigation is dealt with by the Courts.                   

The SLC has produced a draft Bill alongside its report, and it is likely that the Scottish Government will now conduct its own consultation exercise seeking stakeholders’ views on the report and the Bill.

Weightmans will be closely following the progress of the SLC’s report and any proposed legislation which may be brought forward. Further updates will be provided.          

In the meantime, please contact the writer if any point arises that you would like to discuss.