The Claimant accepted 67.5% of damages assessed on a full liability basis. Damages were decided by His Honour Judge Reid QC on 19 January 2006. A major issue, which gave rise to the Appeal, was the extent to which, if any, the Claimant’s damages should be reduced so as to account for payments the Claimant’s Local Authority would or might make to him towards his care costs.

The Judge assessed the Claimant’s total annual care costs. He also heard evidence from the Claimant’s Local Authority as to the sums they would pay by way of direct payments towards his care. The Judge then deducted the annual Local Authority payments from the Claimant’s annual care costs and applied the agreed whole life multiplier to that multiplicand to arrive at the figure for the Claimant’s future care head of loss.

The Claimant appealed the Judgment of His Honour Judge Reid QC. The Appeal came before Lords Justices May and Dyson and Lady Justice Smith in December 2006.

In a unanimous Judgment the Court of Appeal held that “if the Court is satisfied that a Claimant will seek and obtain payments which will enable him to pay for some or all of the services for which he needs care, there can be no doubt that those payments must be taken into account in the assessment of his loss. Otherwise the Claimant will enjoy a double recovery”.

The Court of Appeal also discussed the case of Freeman v Lockett (2006) EWHC 102 QB where Tomlinson J had considered similar issues but decided there should be no reduction in the Claimant’s damages to reflect the possibility of direct payments from the Local Authority. The Court of Appeal considered there was a sufficient basis for Tomlinson J’s decision on his finding that the Claimant wanted to rely exclusively on private funding for her care and there was no basis on which the Court could estimate what funding the Claimant could reliably expect to receive from the Local Authority for the rest of her life.

The Court of Appeal accepted there may be cases where the possibility of a Claimant receiving direct payments is so uncertain that they should be disregarded altogether in the assessment of damages. It said however “It will depend on the facts of the particular case. But if the Court finds that a Claimant will receive direct payments for at least a certain period of time and possibly for much longer, it seems to us that this finding must be taken into account in the assessment. In such a case, the correct way to reflect the uncertainties to which Tomlinson J referred is to discount the multiplier”.

The Court of Appeal considered the complex legislation and guidance, which provides the statutory framework for local authorities’ duty to provide accommodation and domiciliary care. It referred to Local Authorities having a duty to assess a disabled person’s needs. It discussed the provision for persons who are assessed as needing community care services, to receive direct payments so as to secure the provision of relevant services instead of receiving the services directly from the Authority.

The Court of Appeal rejected the Claimant submission that where a Claimant has received a substantial award of damages, his Local Authority will not provide practical assistance to him in his home and will not make direct payments because it will not be necessary for it to do so in order to meet his needs.

The Court of Appeal held “a Local Authority is obliged to disregard personal injury damages administered by the Court of Protection in deciding the threshold question”.

In confirming that a Claimant’s personal injury damages are “ring fenced” they also confirmed that the position is the same in relation to Section 21 (which deals with the provision of accommodation) and Section 29 (which deals with the provision of care) of the National Assistance Act 1948.

The Court of Appeal went on to say “once the Judge decided that the Council would make such direct payments, it seems to us that he was bound to hold that they should be taken into account in the assessment of damages. This point needs to be made because there is much to be said for the view that the tortfeasor should pay, and that the state should be relieved of the burden of funding the care of the victims of torts and that its hard-pressed resources should be concentrated on the care of those who are not the victims of torts”.

Finally, the Court of Appeal dealt with the Judge’s decision as to the amount of direct payments that would be received by the Claimant. The Court of Appeal held the Judge was entitled to reach the conclusion he did on two issues, namely (1) the number of hours to be covered by direct payments and (2) the hourly rate that would be paid by the Local Authority. The Court of Appeal however have decided to remit the direct payments issue to the Judge for further consideration as they consider there was no evidence that would have enabled the Judge to decide whether and to what extent any payments could be regarded as being secure for the next 40 years. The Court of Appeal said “in our view, the Judge was wrong to apply the agreed whole life multiplier to the direct payments. The uncertainties to which he referred … and to which Tomlinson J referred to in Freeman should have led him to conclude that a substantial discount to the multiplier was ne cessary … we do not feel able to determine the correct multiplier”.

The Claimant was awarded one third of his costs of Appeal.