The Supreme Court has today (26 March 2024) handed down its much anticipated judgment in the mixed injury test cases: Hassam v Rabot and Laditan v Briggs [2024] UKSC 11.
Lord Burrows, in a judgment agreed by the rest of the panel, has dismissed the appeals and cross-appeals and has upheld the Court of Appeal's majority decision.
The Court of Appeal's decision and details of the underlying cases can be found in our previous alert here.
The purpose of the test cases was to obtain clarity from the Court as to how parties should assess damages for pain suffering and loss of amenity (PSLA) where the claimant suffers a whiplash injury within the scope of Part 1 of the Civil Liability Act (the 2018 Act) which attracts a tariff award, and also suffers additional injury which falls outside of the scope of the 2018 Act and does not attract a tariff award.
The Issue before the Supreme Court
The issue before the Supreme Court was one of statutory interpretation. In deciding the outcome, the Court considered the statutory position as against 3 possible interpretations:
- The Master of the Rolls' dissenting approach in the Court of Appeal, supported in the defendants' appeals to the Supreme Court, that the tariff covers the whiplash injury and all PSLA caused by it including that which was concurrently caused by a non-whiplash injury. Only an amount for damages for the non-concurrent PSLA caused by the non-whiplash injury should be added to the tariff sum. Double recovery would, therefore, not arise.
- The claimants' primary approach in the Court of Appeal and Supreme Court, supported by the interveners (APIL and MASS), of adding together the tariff amount and the common law amount for PSLA for the non-whiplash injuries with no deduction for the resulting double recovery.
- The approach adopted by the majority of the Court of Appeal, supported by the claimants as their secondary position, of adding together the tariff amount and the common law amount for the non-whiplash injury and then standing back to consider whether to make a deduction to reflect any overlap between the 2 amounts – the modified Sadler approach.
The Court held that the claimants’ primary argument that double recovery was permitted by the 2018 Act was untenable.
The question was then how the 2018 Act provided that double recovery should be dealt with. The Court held that as a matter of interpretation the Act did not amend the common law approach to valuation of damages for non-whiplash injuries.
Interpretation of the legislation
The Supreme Court's decision focusses on the interpretation of section 3 of the 2018 Act. They found that s3(2) makes it clear that the tariff amount is confined to damages for PSLA 'in respect of the whiplash injury or injuries' and does not extend the tariff amount to PSLA for non-whiplash injuries.
Section 3(8) is:
Nothing in this section prevents a court, in a case where a person suffers an injury or injuries in addition to an injury or injuries to which regulations under this section apply, awarding an amount of damages for pain, suffering and loss of amenity that reflects the combined effect of the person’s injuries (subject to the limits imposed by regulations under this section).
The Court found that the opening words, and the reference to an amount 'that reflects the combined effect', indicate that the statute is, in general, not departing from the standard common law approach to assessing damages for multiple injuries. It was noted that it may be considered significant that the words 'reflects the combined effect' match the precise words used by Pitchford LJ in Sadler . The bracketed words at the end of the section were found to show that the common law approach must not be applied in such a way as to be inconsistent with imposing the tariff amount laid down in the 2021 Regulations.
Findings
The Court held that the perceived mischief at which the 2018 Act was aimed was whiplash claims and there is nothing in the 2018 Act that indicates that it affects damages for non- whiplash injuries.
The Court also found that the third, Sadler, approach, which is far more impressionistic and broad brush, is likely to be easier to apply in practice than the more scientific and unfamiliar first approach, which it thought would require medical reports to be modified so as to be more precise about the PSLA . (It did not address defendants’ submission that even applying Sadler properly would require medical reports to be more precise about concurrent PSLA.)
Lord Burrows set out that the first approach was rejected for four reasons: 1. there is nothing in the wording of the 2018 Act to indicate that the scope of the reform extended to damages for non-whiplash injuries; 2. the Master of the Rolls' 'principled' and 'scientific' approach would be too complex to apply when what constitutes concurrent PSLA should be looked at in a 'rough and ready' way; 3. the consequence of the approach would be that claimants with both whiplash and non-whiplash injuries would end up with a lower award than those with non-whiplash alone; and 4. it would represent a greater departure from the common law than the third approach accepted by the Court.
The conclusion flowing from these findings and the Court's rejection of the claimants' primary case was that the common law Sadler approach to multiple injuries is basically to be applied subject to the qualification that the Sadler adjustment must respect the legislature’s decision to award the lower sums specified for PSLA in respect of the whiplash injuries. No further guidance, however, has been provided as to how to apply the adjustment given the Court acknowledged that the tariff values damages as what the Lord Chancellor deems ‘proportionate’ which is far lower than the common law damages which are ‘fair, just and reasonable’.
The outcome
Lord Burrows re-stated the test set out by the majority of the Court of Appeal as follows:
- assess the tariff amount;
- assess the common law damages for PSLA for the non-tariff injury;
- add them together;
- step back and consider whether to make a Sadler adjustment. It was noted that the adjustment must reflect, in a rough and ready way, the need to avoid double recovery, and respect the fact there is a tariff sum – so the Sadler adjustment is a slightly different exercise than if you are dealing entirely with common law damages; and
- consider the 'caveat', i.e. the final award cannot be lower than would have been awarded as common law damages for PSLA for the non-whiplash injuries had the claim been for those injuries alone.
Is it the final word?
The Court has interpreted the 2018 Act as relating only to a whiplash injury or injuries – the mischief at which the legislation was aimed. Parliament can be presumed not to have altered the common law further than was necessary to remedy that mischief.
Argument that approach 3 serves to undermine the purpose of the legislation was not accepted as it was noted that 'Clearly claimants who have suffered only whiplash injuries will receive a significantly lower sum in damages for PSLA than at common law (see para 2 above); and, as shown by these cases, that remains true even where damages are also claimed for non-whiplash injuries'.
The Court stated that even if there is evidence that claimants might be able to thwart the purpose of the legislation by claiming for multiple injuries, the issue would be a policy problem for Parliament to address.
It is worth revisiting what then minister Rory Stewart said to the Commons when debating the 2018 Act:
…we must send a very strong message of respect towards people who are genuine victims of whiplash injuries, or indeed of any other form of personal injury. They are entitled to a fair level of compensation and to an adequate level of representation. We believe very strongly that the measures in the Bill strike a proportionate and reasonable balance between fair compensation, reasonable representation and the costs imposed on the rest of society.
It remains to be seen whether Parliament will accept the Supreme Court's interpretation of the 2018 Act as striking the proportionate and reasonable balance, or whether it will want to prevent the benefits of the whiplash reforms from being eroded through claims for multiple injuries.
Parliament may want the final word on mixed injuries.
DAC Beachcroft represented the defendants in both appeals, instructed by the ABI and the defendants’ insurers.
For more information or advice, please contact one of our experts in our Strategic Advisory Team.
