Kennedys’ experience demonstrates that defendants and insurers should approach requests for provisional damages with care.
Whilst we were acting recently for a major client in an asbestosis case, a trade union firm revealed that it was their policy to seek a period of 100 years on any return conditions in the provisional damages consent order.
This prompted us to consider the law relating to provisional damages, the circumstances in which they can be claimed and the importance of ensuring that only appropriate return conditions are included in the order.
The courts’ discretionary power to award provisional damages is set out in s.51 County Courts Act 1984 and s.32A and s.34A Supreme Court Act 1981. Provisional damages are awarded where there is a chance that, at some time in the future, the injured person will, as a result of the act or omission giving rise to the cause of action, develop some serious disease or suffer some deterioration in his physical or mental condition. This allows the courts to award claimants (a) damages assessed on the assumption that they will not develop a disease or suffer a deterioration of their condition; and (b) further damages, if at a future date they develop the disease or suffer deterioration.
CPR 41 sets out the procedural framework for provisional damages claims. The practice direction to Part 41 sets out what the provisional damages order should contain. The order must specify the disease or type of deterioration which will entitle the claimant to apply for further damages, give an award of immediate damages, specify the period in which an application for further damages may be made and direct what documents are to be filed and preserved as the case file in support of any application for further damages.
Guidance was given to practitioners in Wilson v Ministry of Defence . The Judge held that it was necessary to consider (a) whether a claimant had proved there was a chance of some serious deterioration in their condition and, if so, (b) whether the court should exercise its discretion in favour of the claimant in the circumstances of the case. It was clarified that this risk must be measurable, and not merely fanciful, and something beyond ordinary deterioration.
Claimants usually seek standard return conditions, which have become accepted as arising from asbestos exposure. However, defendants should always remember that the law requires a serious deterioration to qualify. Arguably, claimants with pleural thickening, with a minimal future risk of progression, should not be permitted to return to court for further damages in cases of deterioration of those conditions.
We must also question the rationale of granting a claimant a greater limitation period for a return condition than permitted under the Limitation Act 1980. In respect of a policy of seeking a carte blanche 100 years, should a claimant be in a better position to pursue an action than someone who developed the condition as a first cause of action, who is restricted to a period of three years from their date of knowledge? We think not. It follows that, in the case mentioned above, the claimant’s solicitors’ proposals in their consent order were rejected, and appropriate amendments made.
It is also becoming commonplace for solicitors to seek to reserve rights for the claimant’s estate in the event of death. However, the courts have no power to grant a declaration in this regard. The Law Reform (Miscellaneous Provisions) Act 1934 and the Fatal Accidents Act 1976 enshrine the rights of the deceased’s estate to bring such a claim, and therefore there is no need to include this within the provisional damages consent order.
The case serves as a reminder of the need to avoid allowing a claimant and his estate two bites of the cherry in the pursuit of return conditions. A provisional damages order which has been well thought through has the benefit of long term costs benefits to an insurer in avoiding multiple claims.