Legal Watch - Personal Injury - Issue 33

Legal Watch:Personal Injury19th September 2014Issue: 033

Events

Plexus and Greenwoods hold a series of events which are open to interested clients. See below for those being held in the next few months:

The Major Bodily Injury Group (MBIG) | Spring Seminar | 28.04.15 | The Wellcome Collection, London

In This Issue:

• Civil procedure/case management post Denton

• Damages

Civil procedure/case management post DentonIn Doctors Associates Inc v Hussain [Lawtel 16/09/2014] the applicant/defendant applied to set aside a default judgment ordered against him in infringement and passing off proceedings brought by the respondent/claimant fast-food outlet owner against the defendant and two others.

The claimant owned the goodwill in the mark, “SUBWAY” and sold sandwiches and similar foods. It claimed that the defendant had used that mark on a sign on a snack food outlet since early April 2013. Default judgment was entered against the defendants and, in respect of the applicant/defendant, on the basis that he had not served an acknowledgement of service or defence. He stated that he had not known about the claimant’s complaint until after the order was made. He had originally stated that he had granted a lease to his co-defendant which commenced in March 2013 and that he could not be liable as the outlet had been under the co-defendant’s control at the relevant times. The co-defendant, however, stated that he had not acquired the lease until May 2014. The defendant then changed his position, admitting responsibility for all acts complained of, stating that he had taken the lease in March 2013 and that the claimant was wasting its time in pursuing him as he had no money. He sought to set aside the order on the basis that he had reasonable grounds for defending the claim. The claimant adduced evidence that the defendant owned the premises and had purchased it two years earlier at a price of £45,000, free of mortgage.

Opposing the application, the claimant submitted that the defendant’s position lacked all credibility as he had concocted a new version of events with the co-defendant so that his defence had no real prospect of success. Alternatively, if the order were to be varied, the court should attach a condition under CPR 13.3(2) that the defendant should pay £20,000 into court.

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‘...it could not be said that the defendant’s defence should be dismissed without him having an opportunity to present it.’The court allowed the application. The defence advanced and the circumstances in which it had emerged lacked a great deal of credibility. However, bearing in mind that the defendant and his co-defendant had asserted the truth of parts of that defence, it could not be said that the defendant’s defence should be dismissed without him having an opportunity to present it. There were various documentary matters that would also need to be considered, such as the lease and any licence agreements.

The defence was very close to the borderline point at which the court would have refused to set aside the earlier order. In those circumstances, the defendant should provide some safeguard as to costs. It appeared that he had an asset. The order would be set aside to the extent that he would have permission to defend the claim, subject to his paying £20,000 into court within 14 days, or providing a bank guarantee or other suitable protection in respect of the claimant’s costs.

CommentIn the bleak months between Mitchell and Denton is it likely that a court would have adopted a similar approach to the defendant’s default? We think not.

In the second case, Thwaytes v Sothebys [Lawtel 18/09/2014] the applicant/defendant auction house applied for permission to rely on an additional expert report in a breach of contract claim brought by the respondent/claimant.

The claimant had owned a painting known as ‘The Cardsharps’. The original was painted by Caravaggio and was generally accepted to be a work acquired by an art museum in Texas, although Caravaggio might have painted more than one version. The claimant instructed the defendant to research and sell his painting. The defendant considered it to be an anonymous 17th century copy and sold it to a British art historian for £42,000. The defendant then alleged that scholarly opinion suggested that his version was also a Caravaggio and could have been worth up to £50 million. He claimed breach of contract on the basis of negligent advice. The defendant maintained that the painting had been rejected as a Caravaggio by a wide range of scholars. At a case management conference the claimant was permitted to rely on the evidence of two experts and the defendant was permitted to rely on one. Reports were exchanged and the defendant discovered that the claimant’s experts had raised a large number of matters which had not been pleaded and which had not been addressed by its expert. The claimant’s particulars of claim were amended by consent on condition that the defendant could adduce supplemental witness statements. The defendant served statements from its existing expert and also from a second expert who dealt with the more technical viewpoints in respect of the similarities and differences between the original and sold paintings which were beyond the scope of its existing expert’s knowledge. At a pre-trial review six weeks before the trial date the defendant applied to be allowed to rely on the second expert’s evidence.

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The claimant argued that the defendant should be restricted to relying on the evidence of its existing expert as the second expert’s evidence did not arise in response to the amended pleadings. The evidence was being adduced at a very late stage and a further expert meeting was necessary, but there was no time for that to happen either before or during the trial.

‘...the court would be greatly assisted by the second expert’s specialist expertise, as an adjunct to its existing expert’s evidence...’Allowing the application, the High Court judge held that the court would be greatly assisted by the second expert’s specialist expertise, as an adjunct to its existing expert’s evidence, in relation to the additional points raised. The original expert had not overreached himself and, although the amended particulars of claim covered the same ground in general terms, they had addressed issues of more technical detail. More specialist evidence would therefore be helpful. The claimant’s concerns in relation to the effect on the trial were exaggerated. He had known that there would be a further expert report and there was no reason to exclude it.

The proposed expert meeting was unlikely to be valuable enough to justify postponing the trial and its absence would not justify excluding the second expert’s evidence. Including the witness statement would neither jeopardise the trial date nor prejudice the claimant and it would be unjust to prevent the defendant from relying on specialist expertise which their existing expert did not have.

CommentThe fact that the judge took the view that allowing in this additional evidence would not threaten the trial date was clearly a material factor. Nevertheless it is interesting to

contrast this decision with the post-Mitchell/pre-Denton case of Neile v University Hospitals NHS Trust featured in Legal Watch: Personal Injury 6.

The claimant alleged that her GP had failed to diagnose that she was suffering from meningitis and that she should have immediately been treated with penicillin and transferred to hospital. Following the exchange of medical experts’ reports the claimant sought an order (among others) that since she had instructed an ophthalmologist rather than a neuro-ophthalmologist, as the defendant trust had, the experts were not matched and she should be able to instruct somebody else.

The trust contended that the claimant was expert shopping.

On this issue, the court found that the claimant’s current expert had dealt with causation and damage to the optic nerve. He appeared to have no difficulty coming to a perfectly proper opinion and named neuro-optics as one of his areas of expertise. There was no good reason for permitting a change in expert when the one instructed was perfectly able to deal with the issues. The fact that one expert had more experience than another was not uncommon.

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DamagesIn the case of Billett v Ministry of Defence [Lawtel 11/09/2014] the court was required to determine damages after the defendant ministry admitted liability to pay 75% of the damages caused by a non-freezing cold injury to the claimant (age 29).

The defendant had employed the claimant as an acting lance corporal in the British army. He had suffered the injury in February 2009 when engaging in physical exercises in cold weather. He was medically downgraded and although he was later upgraded, he left the army in October 2011. He claimed that he had left partly because of his injury as he considered that his career prospects had been damaged and he was unhappy about the way he had been treated. He arranged new employment as an HGV driver at about the same time as he left the army. The claimant described his injury as a minor injury to his feet with less severe symptoms in his hands. His expert medical witness produced a report in March 2012 which, although it accepted that the claimant’s feet had been injured, only said that it was possible that he had sustained a hand injury. The issues were (i) whether the claimant had sustained any injury to his hands; (ii) whether he had left the army because of his injury or for other reasons; (iii) the appropriate amount of general damages for pain, suffering and loss of amenity, and for loss of congenial employment; (iv) whether future loss of earning capacity should be valued by reference to Ogden tables.

The claimant submitted that the appropriate level of general damages for pain, suffering and loss of amenity was £17,500, and that his future loss of earnings should be assessed in the sum of £427,151 on the basis that he would have stayed in the army and been promoted but for his injury. Alternatively, he argued that his future loss of earnings should be assessed on an Ogden tables A and B reduction factor basis, using the uninjured and injured multipliers, to reflect the impact of his disability on his earning capacity in the civilian labour market.

The deputy High Court judge held that the injury did not extend to the claimant’s hands. The diagnosis of the injury to his feet was based on objective findings and medical records. In the absence of such evidence in respect of the hands, the claimant’s expert was right to express his conclusions tentatively. The claimant had not mentioned any problem with his hands at time of injury or years afterwards. Accordingly, the court could not accept that he had sustained any injury to them.

When the claimant applied for early release from service, he had not mentioned his injury despite the fact that he could have done. It was accordingly hard to accept that his injury was a real motivating factor in causing him to leave the army. It was not true that, but for his injury, the claimant would have stayed in the army beyond October 2011. The real reasons for his leaving were his family commitments and plans for civilian life. He would have left the army when he had, even if he had not suffered his injury.

Having considered authorities on much more serious cases of non-freezing cold injury, the appropriate figure for general damages in this case was £12,500.

The claimant’s claim for loss of congenial employment failed because of the finding that he had given up his career for reasons other than the injury. He was also entitled to damages in respect of other identified items of past loss, including additional heating costs and additional clothing.

Since the claimant would have left the army regardless of his injury, future loss of earnings could not be assessed on the basis that he would have stayed but for his injury. The court had three options for calculating future loss of earnings: (a) a traditional Smith v Manchester lump sum award; (b) an award based on Ogden tables A and B without adjustment; (c) an award using Ogden tables A and B with adjustments in light of the particular circumstances.

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‘The court had three options for calculating future loss of earnings’It was not appropriate to make a traditional lump sum award. Such awards were appropriate where there was great uncertainty about what the claimant would have done if uninjured. Since there was no doubt that the claimant would have left the army regardless of his injury, for as much of his future career as he could arrange, he would have been earning exactly the same as if he had been uninjured. The only difference was that if he had to change jobs, he would have had more difficulty finding alternative work than he would otherwise have done. The claimant was “disabled” by reference to the Ogden test. Given that a lump sum award was inappropriate, the Ogden tables A and B were to be used to assess damages. However, given that there were few who could be classified as “disabled” and yet remain as fit and able as the claimant, it would have been wrong to apply the reduction factors without deduction. Accordingly, the multiplier was substantially reduced for contingencies other than mortality to reflect the minor nature of the claimant’s disability. Considering also his likely retirement age, the court determined that he was entitled to £99,062 for future loss of earnings. He was also entitled to other identified future losses.

CommentThe judge’s approach to the calculation of future loss of earnings was unusual. He found that the multiplicand for future loss of earnings was £21,442 but he declined to make a Smith v Manchester award of three times that figure: £64,326. He found that the multiplier for loss of earnings was (24.29 x 0.92): 22.35. The adjustment factor from Table B was 0.54 but the judge took the view that it reflected far too high a level of disability for this claimant. He therefore took a mid point between 0.92 and 0.54: 0.73 to produce a multiplier for residual earnings of 17.73. Normally that multiplier would be applied to a claimant’s current, reduced

net earnings. However, in this case the claimant was found to be earning to his full potential and was disadvantaged only in that he might find it harder to secure fresh employment if he became unemployed. The judge therefore made the following calculation:

(22.35 – 17.73): 4.62 x £21,442 = £99,062. Is this not simply a higher than usual Smith award, produced by a different method? It does not seem to be an application of the second part of the Ogden methodology. It is, however, another example of a judge re-adjusting the multiplier derived by using Table B to reflect more accurately the claimant’s level of disability in the context of employability.

The information and opinions contained in this document are not intended to be a comprehensive study, nor to provide legal advice, and should not be relied on or treated as a substitute for specific advice concerning individual situations. This document speaks as of its date and does not reflect any changes in law or practice after that date. Plexus Law and Greenwoods Solicitors are trading names of Parabis Law LLP, a Limited Liability Partnership incorporated in England & Wales. Reg No: OC315763. Registered office: 8 Bedford Park, Croydon, Surrey CR0 2AP. Parabis Law LLP is authorised and regulated by the SRA.

www.plexuslaw.co.ukwww.greenwoods-solicitors.com

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