Compo culture for the chop?

Insurers are used to hearing about ever increasing levels of awards in personal injuries cases.  Recently, there have been some small indications that things may be changing.

It was reported in the domestic media last week that the caretaker Minister for Enterprise, Jobs and Employment, Mr Richard Bruton has met with the President of the High Court, Mr Justice Peter Kelly, in an effort to get judicial support for guidelines in respect of claims for personal injury. It was also reported that the potential for a new Book of Quantum was among the issues discussed at that meeting.

The impetus for this development appears to be pressure from the insurance industry to address the problem of increasing insurance premiums which are being attributed to the rise in the number and value of personal injuries claims.

Separately, the Court of Appeal recently halved the level of damages awarded by the High Court in a personal injuries claim. The High Court had awarded Anthony Shannon, €90,000 and his wife Rita Shannon, the sum of €130,000 in respect of injuries sustained in a road traffic accident.  The Court of Appeal felt that the High Court judge had erred in considering that the injuries were “significant” and considered in fact that the injuries for both parties were “modest”.

The Court also stated that awards of damages must be:

1. Fair to the Plaintiff and Defendant;
2. Proportionate to social conditions bearing in mind the common good;
3. Proportionate within the scheme of awards made for other personal injuries.

The Court of Appeal also made an interesting observation that when it comes to assessing the severity of an injury, it should consider the extent of the pain and suffering endured by the Plaintiff and the effects which the injuries have had and will have on the Plaintiff’s enjoyment of life – rather than focusing on the medical diagnoses or labels which are attached to the Plaintiff’s injuries.

The Court of Appeal also set out some of the factors that a trial judge should take into account when assessing past and future damages for personal injuries actions. These include:

1. The severity of the injury;
2. How long it has taken the Plaintiff to recover;
3. Whether the injury has short or long term consequences;
4. The impact on the Plaintiff’s life, including the impact on family, work, sports, hobbies, pastimes;
5. Any other features that are relevant to the Plaintiff’s particular circumstances.

This list is clearly not exhaustive but does give a helpful indication of the type of things that should be taken into account by a trial judge. The Court of Appeal also noted that whilst the High Court trial judge had the benefit of hearing all of the evidence it wasn’t entirely clear from the High Court’s decision what the basis or rationale of the decision was.

While it is important not to read too much into these recent developments, they do, at least, present helpful counter balances to the otherwise challenging insurance environment.

Author: Killian O'Reilly