Inflation-proofing catastrophic bodily injury damages

Thompstone v Tameside & Glossop Acute Services NHS Trust and four associated actions CA (Civ Div) 17 January; TLR 30 January SJ 5 February p29

All four claims were appeals from judges who, when inflation-proofing periodical payments for future care costs, applied a rate higher than the retail prices index following the decision in Flora v Wakom (Heathrow) Ltd (formerly Abela Airline Catering Ltd) [2007] 1 WLR 482. The Court held that the Damages Act 1996 s2(9) empowers the court to apply a different measure for the indexation of future periodical payments. It also approved, on the facts, the suitability of the Annual Survey of Hours and Earnings (ASHE) as an alternative indexation measure for the claimants’ future care needs. The judge in one of the cases had been correct to state that his task was to decide what form of order would best meet the claimant’s needs and to determine, as far as s2(8) and s2(9) were concerned, what was appropriate, fair and reasonable. He had also been right to say that such matters did not lend themselves to determination by the burden of proof and that the claimant had only an evidential burden. The question of whether the RPI should be replaced would depend on the alternatives available and was bound to be a comparative exercise. Indexation on the allocation of heads of damage between lump sum provision and periodical payments orders were interrelated and should be considered together. The claimant’s ‘needs’ are not limited to the needs that he demonstrated for the purpose of proving the various heads of damage, but included those things that he needed to enable him to organise his life in a practical way. The judge should apply an objective test. He had to have regard to the wishes and preferences of the parties and to all the circumstances, but ultimately, it was for him to decide what order best met the claimants’ needs. The report of an independent financial advisor was likely to help the judge. The judge should have regard to the defendant’s general preferences without the need for evidence to be called and it would only be in a rare case that it would be appropriate for a defendant to call expert evidence to seek to show that the form of order preferred by the claimant would not best meet his needs.