New guidelines for personal injury awards

25 Sep 2015

The latest edition of the guideline figures for general damages was published on 17 September 2015. By and large, the guideline figures have been increased by prices inflation, as measured by the RPI, between 2015 and 2013, as anticipated in this recent piece on BLM’s Policy Blog.

Key information

The relevant RPI figure is 3.4% (from April 2013 to April 2015). Very few of the new guideline figures lie beyond a narrow range of plus or minus 0.5% of that. The most significant of the outliers are probably:

  • the upper level for provisional awards for moderate lung disease / bronchitis, which has been increased by over 75% from £7,800  to £13,750 and
  • a modest change in the description of minor whiplash claims producing, apparently, a 20% increase in the upper guideline for these cases (which is explained below).

Commentary on the new edition

In their analysis of the UK motor insurance market in 2014, consultants EY predicted overall inflation (frequency and severity) in motor bodily injury claims running in excess of 7% for both 2015 and 2016. The outturn, if correct, would be 16% inflation over these two years. Like-for-like comparison with the 3.4% RPI (actual) over two years used to produce the new general damages guidelines is not possible but the contrast is nevertheless striking.

The new 13th edition includes, as did the 12th, separate columns recording (i) the appropriate guidelines for pre-Jackson cases and (ii) guideline amounts for subsequent cases, which attract an additional 10% general damages to compensate claimants for the loss of recoverable success fees brought about by part 2 of the LASPO Act 2012.

Part 2 of the Act applies to personal injury and disease claims generally, but it has not been commenced for mesothelioma claims. It follows that the inclusion of guideline figures increased by 10% for this disease is a serious oversight which, having first been made in the 12th edition in 2013, really ought to have been rectified or properly explained by now. [Worth recalling, perhaps, that the Court of Appeal needed two attempts at implementing the 10% increase in general damages, in judgments in Simmons v Castle in July and October 2012.]

The 13th edition separates out some categories of injury for the first time, providing guideline figures for: failure to diagnose ectopic pregnancies (£25,000 to £75,000), for injuries leading to double incontinence (up to £140,000), for mental anguish due to impending death (£3,550, with reference in the introduction to the 2014 case Kadir v Mistry) and for paralysis cases in which death occurs for unrelated reasons a short time after the accident (£37,500).

Chapter 7 dealing with neck injuries (at section A) again cross refers to later guidance on minor injuries generally, at chapter 13. The figures in both places are consistent, in that minor neck injuries which recover within 3 months attract from a few hundred pounds to £1,860 at chapter 7 and chapter 13 also uses the £1,860 cap for three month recoveries. This consistency, however, masks a notable increase at chapter 7, although the language used to describe category 7(A)(c)(iii) has subtly changed. The new upper bound of £1,860 for these injuries, typically whiplash, “Where a full recovery is made within three months” (13th edition) represents an increase of 20% on the previous figure of £1,550, which applied “Where a full recovery is made within a period of a few days, a few weeks or a few months” (12th edition).

The guidelines quoted in the previous two paragraphs are those without the Simmons increase.

Wider issues

Langstaff J’s introduction raises several interesting points for the future. First, whether the RPI is the appropriate index to use for general damages and if not, what would replace it? Consumer Prices Inflation or CPI is more widely used in the economy generally and by ONS. It is currently running at a lower level than RPI and its use in this edition would have yielded a general increase of below 2%.

Second, he repeats the idea of seeking to achieve gender-neutrality in awards for facial scarring, a matter first aired by Smith LJ in the 11th edition in 2012. More broadly with regard to cosmetic appearance, he raises the question of dealing with the consequences of failed cosmetic surgery in the guidelines, including whether 'injury to feelings' elements should be accommodated, by analogy with discrimination claims. These would be value judgments well beyond the mathematical uprating of existing guidelines to take account of inflation. According to one senior judge:

 

“The monetary evaluation of non-pecuniary losses is a philosophical and policy exercise more than a legal or logical one. The award must be fair and reasonable, fairness being gauged by earlier decisions; but the award must also of necessity be arbitrary or conventional. No money can provide true restitution … The sheer fact is that there is no objective yardstick for translating non-pecuniary losses, such as pain and suffering and loss of amenities, into monetary terms.”

 

[per Dickson J of the Canadian Supreme Court in Andrews v Grand and Toy Alberta Limited in 1978]

With the overall increase of 3.4% for RPI in the new edition, an ever smaller proportion of injury claims will fall within the small claims track. Whether the Government takes any action to change the current small track limit of £1,000 remains to be seen. This topic may be covered in the report of the Insurance Fraud Task Force, which is due before the end of the year. The £1,000 figure was set in 1991. Applying the relevant RPI increase since then would approximately double the limit.

Bereavement damages are set by statute and therefore not dealt with in the guidelines. The level was last reviewed in 2013, coinciding with the LASPO Act. An increase of 10% was applied then, with the award set at £12,980. The current and previous figures have been heavily criticised by claimant representatives. An open e-petition calling for change has so far attracted very limited interest, far short of the 10,000 signatures needed to generate a Government response, never mind the 100,000 signatures required to precipitate a Parliamentary debate.

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Disclaimer: This document does not present a complete or comprehensive statement of the law, nor does it constitute legal advice. It is intended only to highlight issues that may be of interest to customers of BLM. Specialist legal advice should always be sought in any particular case.

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