Rupasinghe v West Hertfordshire Hospitals NHS Trust

The right of action under the Fatal Accidents Act 1976 ensures for the benefit of the dependants of the deceased: on the facts of the instant case, these are the Claimant, Hesara and Senugi. The parties are agreed that damages must be awarded to reflect the loss of dependency.

The provision in the Fatal Accidents Act 1976 governing the assessment of damages is section 3(1), which provides:

“In the action, such damages…may be awarded as are proportional to the injury resulting from the death to the dependants respectively.”

This wording was to be found in the original Fatal Accidents Act enacted in 1846, and is somewhat terse. I read the phrase “as are proportional to the injury” as intended to govern distribution as between the dependants rather than as a synonym for “proportionate”. That said, there may well be other reasons why disproportionate damages would not be awarded. As McGregor on Damages, 19^th Edition, paragraph 39-017 observes:

“This is both wide and vague, but the interpretation of the Courts, before the introduction of a separate entitlement of some to a limited recovery for bereavement, restricted recovery to damages for the loss of the pecuniary benefit arising from the relationship which would be derived from the continuance of the life. In short, the measure recoverable by a dependant is what is often called the value of the dependency…”

In my view, as ever the late Dr McGregor has struck at the heart of the issue. Damages are awarded “for the loss of the pecuniary benefit arising from the relationship which would be derived from the continuance of the life”. How this principle should be applied exactly in the present case remains to be explored.

Miss Bradley has reminded me of the principles of general application governing claims of this sort.

First, as Diplock LJ explained in Malyon v Plummer [1964] 1 QB 330:

“It has, however, long been established, despite these wide words [of what is now section 3(1) of the 1976 Act], first: that the pecuniary loss to the persons for whose benefit the action is brought is the only damage recoverable, and, secondly, that the pecuniary loss recoverable is limited to the loss of a benefit in money or money’s worth, which if the deceased had survived, would have accrued to a person within the defined relationship to the deceased, and would have arisen from that relationship and not otherwise.” [at page 349]

To my mind, this second principle is, for present purposes, at least as valuable as the first. The circumscribing principle is that damages are awarded as recompense for the loss of the benefits which would have enured to the dependants if the deceased had survived, flowing from the relationship between the deceased and these dependants. This aspect of the matter is reinforced by consideration of what Diplock LJ said two pages later in the Law Report, namely that the wife’s salary, however paid, could form no part of “the dependency”, as it would continue after her husband’s death – “it would not be a benefit arising out of the relationship of husband and wife which she would lose on his death”. However, I do not agree with Miss Bradley that this short passage provides a conclusive answer to the present claim as formulated on the Claimant’s behalf. What it does serve to demonstrate is that a claim for loss of earnings simpliciter cannot be accommodated within the relevant statutory provision.

Secondly, as Smith LJ explained in Welsh Ambulance Services NHS Trust v Williams [2008] EWCA Civ 81, at paragraph 50:

“…the dependency is fixed at the moment of death; it is what the dependants would probably have received as benefit from the deceased, had the deceased not died. What decisions people make afterwards is irrelevant.”

This dictum was uttered in the context of a claim for financial rather than services dependency. Whether it applies to the latter, and in what precise respect, remains to be considered.

These general principles aside, the courts have, at least since the late 1980s, tended to address claims under the Fatal Accidents Act 1976 under two broad headings. First, it is said on behalf of a claimant that s/he has lost the financial value of the contribution the deceased had been making to the household, ignoring for these purposes the amounts the deceased spent on herself or himself. Secondly, a claimant argues that s/he has lost the value of the services provided by the deceased to the family, almost always in the form of childcare. Shortly, I will be addressing how the courts have approached the computational process under these rubrics.

Mr Bebb referred me to four earlier decisions which might be said to betoken, or exemplify, a more open-textured approach.

In Steer v Basu [an unreported decision of Caulfield J decided in 1968], the female deceased was the full-time carer of a number of children, and the plaintiff was constrained to “recast his working life” in consequence of her death. This did not entail giving up work altogether but it did lead to a reduction in his earning capacity, as he “placed the comfort and welfare of his children first”. The judge allowed claims reflecting his loss of earnings as well as for the cost of a housekeeper. On my understanding of the Lawtel report, it was not argued that this would lead to double-recovery.

In Mehmet v Perry (1977) 2 AER 529, Brian Neill QC (sitting as a Deputy High Court Judge) held that it was reasonable on the facts of the case before him for the male plaintiff, now solely responsible for the upbringing of five children, two of whom had a serious medical condition, to give up work to look after them. In such circumstances, the damages for the loss of the deceased’s housekeeping services should be assessed by reference to the plaintiff’s loss of wages, because:

“It represents the cost and the circumstances of providing the services of the plaintiff as a full-time housekeeper in substitution for the deceased” [at 536F].

On my reading of this authority, the judge took the plaintiff’s earnings as a proxy for the value of the deceased’s lost services.

A similar approach was followed by Robert Goff J in Watkins v Lovegrove [unreported, 5^th May 1982]:

“…a claim of this kind is simply one example of recovery of pecuniary loss suffered by a dependant in the replacement of services previously rendered gratuitously by the deceased … If [the Claimant] can show that he did act reasonably in giving up his naval career in order himself to replace services previously rendered gratuitously by the deceased wife then, in principle, he should be entitled to recover damages in respect of any pecuniary loss suffered by him by reason of his so acting.”

Robert Goff J did not suggest that the claim should be subject to any further limitation as to reasonableness, or to any ceiling or cap. He calculated the claim with reference to the plaintiff’s loss of earnings and terminal benefits.

Mr Bebb also drew my attention to the factually more intricate case of Cresswell v Eaton [1991] 1 WLR 1113. There, Simon Brown J was dealing with a situation where the mother was tortiously killed, the father was no longer on the scene, and an aunt had to give up work to look after the three children. On the judge’s analysis there were two heads of claim. First, the “disbursement dependency”, representing the mother’s financial contribution to the family in the form of a proportion of her wages; and, secondly, the “services dependency”, representing the value of the mother’s services to her children qua parent. It was held that there was no objection in principle to both claims being advanced in the same action, and that the services dependency claim could properly, in line with Mehmet v Perry, be assessed with reference to the aunt’s wages. This was because the aunt’s relinquishing of her employment was reasonable and that - on my reading of the judgment – the quantum of her earnings were an appropriate surrogate for the value of the deceased mother’s services.

In his judgment, Simon Brown J pointed out that the aunt’s wages were in fact less than the cost of purchasing childcare on the open market. It followed that any question of a “ceiling” or cap did not arise on the facts of that case. In Housecroft v Burnett [1986] 1 AER 332 the Court of Appeal had placed a “ceiling” on gratuitous care claims in the analogous field of personal injury actions. Simon Brown J noted that the quantum of the claim in Mehmet v Perry far exceeded what might have been recovered upon payment of a commercial rate to a professional carer (whether or not discounted for gratuitous care), but also observed that what this had done in practice was merely to intensify the evidential burden on the plaintiff.

There are two more recent first instance decisions which demonstrates slightly contradictory approaches as between each other. In Batt v Highgate Private Hospital [2004] EWHC 707 (Ch), HHJ Darlow stated that the usual course must be that the loss of services dependency should be calculated by reference to the cost of commercial care, discounted for the fact that it was provided gratuitously, rather than the surrogate measure of the remaining spouse’s loss of earnings. This was because “more often than not it is not reasonable to do justice between the parties for a remaining spouse to cease employment entirely”. No doubt the judge was heavily influenced by the fact that, in the case before him, the loss of earnings claim amounted to over £170,000 and the cost of commercial care was just over £52,000. To the extent, however, that the judge may appear to be suggesting that some sort of presumption should apply, I would disagree.

In Manning v King’s Hospital NHS Trust [2008] EWHC 3008 (QB), Stadlen J held:

“In principle if and to the extent that [the claimant’s] net loss of profits in his dental business was caused by him reducing the time spent at work and/or working in a less profitable context so as to be able to provide services to the children which [the deceased] would have provided had she survived, they would be recoverable as an alternative way of assessing the value of the claim for past loss of [the deceased’s] services to the children. However, given that the claimant asserts an independent claim for the loss of those past services, which I have allowed by calculating the notional value of the cost of replacing those services, that part of the loss of earnings claim attributable to looking after the children cannot in my judgment be recoverable as an additional head of damages.” [paragraph 238]

I respectfully disagree with both these sentences. As for the first, it is too broad, inasmuch as the principle asserted appears to be subject to no criterion of reasonableness. As for the second, I have difficulty in understanding how the loss of earnings claim, which if sustainable at all should be regarded as a surrogate for the value of the lost services, could be apportioned on the basis suggested. In any event, I note that the claim failed on its facts.

At paragraph 27 above I indicated that I would be returning to the question of how the courts tend to calculate the claim for loss of financial dependency on the deceased. Since the mid-1980s, the courts have favoured a conventional or presumptive approach, defeasible in the face of contrary evidence to meet particular facts. This approach is that explained by the Court of Appeal in Harris v Empress Motors [1984] 1 WLR 212 and Coward v Comex Houlder Diving (unreported, 18^th July 1988). In essence, the approach entails aggregating a conventional proportion of the spouses’ net income and then deducting a proportion of the surviving spouse’s net income. For these purposes the court does not consider evidence of facts arising post-death but focuses on the instant in time immediately preceding it. Properly understood, the claim is not one for loss of earnings at all, although the surviving spouse’s net earnings are factored into the calculation for the specific purpose of valuing his or her dependency on the deceased spouse’s earnings.

I propose to return to the issue of quantification of the services dependency claim under the analytical rubric of this judgment.

Mr Bebb submitted that the disputed items form part of his client’s services dependency claim and are recoverable on ordinary principles. On analysis, the services dependency claim comprised two elements: first, the claim for gratuitous care (which has been compromised); and, secondly, the claim for “loss of income that has necessarily arisen in order to access that gratuitous care”. In this second regard, I have set out verbatim Mr Bebb’s formulation in his oral opening. Mr Bebb agreed that the second element of claim, as much as the first, was always subject to the constraint of reasonableness. He framed the issue thus: was it reasonable for the Claimant to leave the UK and return to Sri Lanka (I would add, given in the circumstances, the greater availability of care facilities etc.)?

In his closing oral argument, Mr Bebb relied heavily on the decision of Robert Goff J in Watkins v Lovegrove (see paragraph 31 above). On the basis of this authority, he submitted that there were two key questions to be posed and answered, viz.:(i) is this a claim for loss of earnings and gratuitous services, being an example of pecuniary loss suffered by a dependant in the replacement of services previously gratuitously provided by the Deceased? and (ii) if so, can the Claimant show that she acted reasonably in giving up her career in the UK?

Anticipating that reliance would be placed by the Defendant on Smith LJ’s dictum in Welsh Ambulance Services NHS Trust v Williams (see paragraph 26 above), Mr Bebb submitted that the principle that dependency should be assessed solely by reference to the state of affairs at the instant of, or just before, death only applies to claims for income dependency, not to claims for services dependency. If the position were otherwise, the whole line of cases starting with Steel v Basu and running through Mehmet v Perry and beyond would have been wrongly decided. Furthermore, the issue of reasonableness falls to be considered at the time the Claimant decided to return to Sri Lanka in November 2010, not when the value of the claim is being assessed by the court.

Mr Bebb also relied on Manning v Kings Hospital NHS Trust (paragraph 35 above), and sought to invert the final sentence of paragraph 240 of the judgment of Stadlen J to his advantage. He submitted that the Claimant’s drop in earnings was not “conceptually different from the cause of looking after the children”.

Finally, Mr Bebb submitted that there was nothing in principle or authority to suggest that claims for loss of earnings and for gratuitous care should be seen as mutually exclusive. They only would be so if the Claimant were seeking to value, by way of proxy, the care provided by her to her children (emphasis supplied by Mr Bebb). As the point is put in paragraph 33 of his Skeleton Argument, “the claim relates to her loss of career because of the choices she was forced to make as a result of her husband’s premature death”.

Miss Bradley submitted that, both in form and in substance, this was a claim for loss of earnings, and not a dependency claim at all. In terms of form, Miss Bradley relied on how the disputed terms were pleaded in the Schedule of Loss. In terms of substance, Miss Bradley submitted that this could only be envisaged as an impermissible claim for loss of earnings because (i) it was not a claim for financial dependency (as the Claimant concedes), and (ii) it was not a claim for a services dependency – the disputed items cannot form part of that claim since the Claimant is simultaneously advancing a comprehensive claim in respect of gratuitous and commercial care. Analytically, therefore, the claim is not for loss of dependency at all; it is a claim for damages for loss of a career admittedly flowing from the death of the Deceased but not tethered to a loss of a dependency on him. It follows, on this submission, that the Court would be countenancing double recovery if the disputed items were allowable in principle.

Miss Bradley also submitted that the services dependency claim has been compromised by agreement, and that there is nothing left to litigate.

Miss Bradley submitted in the alternative that the sums claimed were in any event unreasonable, being so far in excess of the cost of gratuitous and commercial care.

Some further consideration of Items 2.11 and 2.12 of the Claimant’s Schedule of Loss is required. These are the claims for past and future “Dependency on Services”. An examination of Appendices 7 and 8 reveals that the claims are not merely for gratuitous care but for commercial childcare, as and when required, and for the cost of a driver and cleaner. I agree with Miss Bradley that the Claimant’s services dependency claims have been fully and comprehensively pleaded.

It is axiomatic, and in any event well established by cases such as Malyon v Plummer (see paragraph 25 above), that a free-standing claim for loss of earnings falls outside the scope of section 3 of the Fatal Accidents Act 1976. This is because such a claim does not relate to the loss of a benefit which would have accrued to the Claimant had the Deceased survived. The Act is only concerned with losses which flow from what the Deceased did when alive: either by the making of a financial contribution to the household, or by providing childcare and similar services (capable, under the common law, of being accorded a financial value).

The Claimant does not seek to question or subvert these principles. The key issue, in my judgment, is whether on the particular facts of this case the disputed items do form part of the services dependency claim.

Ordinarily, the court approaches the quantification of a services dependency claim by considering the cost of replacing the services formerly provided by the Deceased. In some situations, it is appropriate to approach this exercise by looking to the cost of furnishing commercial care in the form of nannies, au pairs, child-minders or the like. In other situations, the claim is in essence one for gratuitous care, and the authorities make clear that commercial rates fall to be discounted to reflect that. In the instant case, the Claimant is claiming for commercial care and for gratuitous care, albeit the latter is not being provided by herself. It is being provided by other family members, in particular by her parents. This is nothing inimical to principle in the Claimant advancing claims both for commercial and gratuitous care, but the observation falls to be made that all angles have been covered.

As we have seen from the line of authorities previously discussed, the courts have followed an alternative approach. In appropriate situations, the court values the services formerly provided by the deceased with reference to the earnings foregone by the claimant in order now to furnish these services herself or himself. This is not a claim for loss of earnings in the strict sense; it is a claim for loss of services but using the surviving partner’s earnings as a proxy or surrogate measure for the value of the services foregone.

The precise constraints on this alternative principle have not been set forth in the authorities, although there is general recognition that the claim must be reasonable. Whether this means that the sole issue for the court to consider is the reasonableness of the claimant giving up work, or whether a further issue arises as to the reasonableness of the quantum of the claim, having regard to the financial cost of commercial and/or gratuitous care, is I can see open to debate. I have resolved the first of these issues in the Claimant’s favour, but I have not yet addressed the second.

In all the cases drawn to my attention by Mr Bebb, save for Cresswell v Eaton (paragraph 32 above) where the services in question were now being provided by an aunt who had to give up work, the surviving spouse or partner gave up work in order to provide the services formerly given by the deceased. Mr Bebb submits that the absence of this factual feature here is to his forensic advantage, but I disagree. The services dependency claim has already been valued, and compromised, on the basis of commercial and gratuitous care. In my judgment, there is nothing left to value. The disputed items do not constitute an attempt by the Claimant, applying some form of proxy measure, to value the loss of the Deceased’s services, but rather a broader endeavour predicated on reasoning that the Claimant has lost her career because of her husband’s untimely death. That is, of course, correct as a matter of fact, but it does not avail her as a matter of law. Seen in these terms, the claim is indeed one for loss of earnings, not one attributable to any need to replace a service that the Deceased had formerly been providing. The submission that Mr Bebb has to advance to avoid the charge of double-recovery, namely that the Claimant is not seeking to value her own services by applying a proxy measure, is a submission that fatally undermines his case. Loss of earnings can only be deployed as a proxy measure in respect of the services the surviving partner is now providing herself or himself in substitution for the services previously supplied.

The situation is not improved from the Claimant’s perspective by contending that the disputed items form part of the services dependency claim and are inextricably intertwined with it, or amount to a loss of income that has necessarily arisen in order to access gratuitous care, or that this in reality is a claim for loss of earnings and gratuitous services, being an example of pecuniary loss suffered by a dependant. All these formulations tend to circularity, and fail to explicate the real question.

In my view, it is unnecessary to address the reasoning in some of the early cases culminating, in point of time, with Watkins v Lovegrove. The only case drawn to my attention where the court allowed claims for loss of earnings as well as for the cost of care is Steel v Basu (on my reading of his judgment, Robert Goff J did not do so). These were all cases decided before the Court of Appeal tightened and formalised the quantification exercise in cases such as Harris v Empress Motors, Housecroft v Burnett and Coward v Comex, and they hark back to an era where experienced judges in claims for personal injuries and under the Fatal Accidents Act adopted a more fluid and discretionary approach. I rest on the fact that in all these cases the person giving up work did so in order to provide the relevant care herself or himself, and that the loss of earnings was envisaged as a proxy measure for the loss of services dependency. Put another way, if these factors are missing, it may not be said that the necessary link between the claim and the loss of dependency is made out.

In my judgment, therefore, the disputed items are irrecoverable because: (i) the Claimant has already advanced a comprehensive services dependency claim which leaves no room for supplementation; (ii) the services dependency claim has, therefore, been compromised (I should make clear that I would not have found (ii) without (i)); (iii) the disputed items do not constitute a proxy measure for any loss of services now provided by the Claimant; and (iv) the disputed items do, therefore, constitute an independent claim for loss of earnings. It may be seen that all of these matters are inter-related, and that (i) and (iii) are key.

I reject the possibility of apportioning the claim for “earnings dependency” (see the disputed items, as per the Claimant’s Schedule) as between earnings and services. If I have correctly understood Manning, Stadlen J countenanced the possibility of such an exercise. In my judgment, it is wrong in principle; and in any event I lack the means and evidence to undertake it.

For the avoidance of doubt, I am not deciding this case on any free-standing basis that the disputed items have been compromised by agreement. I have made clear that item (ii) (see paragraph 54 above) flows from item (i) and would not have been reached in isolation. I note that there was agreement at the Bar that it was made clear at a round-table meeting that the disputed items were being advanced as part of the services claim.

I am not ruling out the possibility of bringing simultaneous direct and proxy claims on certain hypothetical facts, but I am on these particular facts. My reasoning would apply to any case where is it clear that the direct claim – for commercial and gratuitous care – covers the whole of the conceivable ground.

Although I have found as a fact that the Claimant acted reasonably in returning to Sri Lanka, I am making no finding as to whether her claim, which I have rejected in principle, is reasonable in amount and/or is subject to some sort of Housecroft v Burnett “ceiling”. It is unnecessary to address Miss Bradley’s alternative submission, particularly in circumstances where the quantum of the disputed items has not been fully investigated.

For the reasons I have given, I find for the Defendant in relation to the disputed items. Subject to Court approval, there will be Judgment for the Claimant in the sum of £335,000.