West Law Report

TRAIN & SONS LTD v FLETCHER

Posted in Measure of damages, Westlaw Reports by mrkooenglish on May 15, 2008

Last Updated: 11:45PM BST 14/05/2008
Court of Appeal (Civil Division) Sir Mark Potter P, Hooper and Moses LJJ April 24, 2008
Court of Appeal (Civil Division)

Sir Mark Potter P, Hooper and Moses LJJ

April 24, 2008

Awards – Dependency claims – Fatal accidents – Interest rates – Calculating interest on damages for loss of financial dependency

FACTS

The appellant (T) appealed against an award of interest to the respondent (F) in respect of her fatal accident claim arising from the death of her husband (H). H had died from the effects of a malignant mesothelioma resulting from his exposure to asbestos in the course of his employment with T. The parties had agreed the amounts in respect of the past loss of financial dependency from date of death to date of trial, further loss to the date of retirement and loss after retirement. In relation to interest on damages for loss of financial dependency, it was agreed that the full rate from the date of death to trial was 14.75 per cent. The judge rejected T’s argument that the award of interest should be at half, rather than the full, rate and limited to the past loss of financial dependency. The judge made an award of interest from the date of death to date of trial upon the whole of the damages claim including future loss. T argued that the judge was bound by the decision of the House of Lords in Cookson v Knowles [1979] AC 556 and so should have awarded interest only on that part of the loss of dependency that related to the period between death and trial, and, in departing from that case, the judge had gone outside the scope of his statutory discretion. F submitted that the observations in Cookson in relation to the award of interest on damages for loss of financial dependency constituted a guideline, which was neither a rule of law nor a binding principle but a rule of practice that was open to the court to revise. F argued that the application of the guidelines in Cookson could lead to under-compensation where a multiplier calculated as at the date of death was used to include both pre-trial and post-trial losses.

ISSUE

Whether the judge was bound by the decision of the House of Lords in Cookson v Knowles [1979] AC 556.

HELD (appeal allowed)

(1) The judge was bound to follow the guidelines in Cookson, which left no room for doubt that the nature of the award of that part of the damages claim that related to post-trial losses was a claim for future loss upon which an award of interest was inappropriate. Furthermore, an award of more than half the short-term interest rate on the total pre-trial loss led to over-compensation. To depart from the method of calculation prescribed in respect of the award of interest in Cookson would be to depart from the clearly stated principle underlying and integral to it. With regard to the multiplier, it was clear that in a fatal accident case the multiplier had to be selected at the date of death, Cookson and Graham v Dodds [1983] 1 WLR 808 applied, Wells v Wells [1999] 1 AC 345 considered.

(2) The alteration of the guidelines in Cookson was not a course properly open to their lordships’ court. The appropriate forum for such reconsideration was the House of Lords.

Patrick Limb QC (instructed by DWF, Manchester) for the appellant. Peter Cowan (instructed by Thompsons) for the respondent.

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