Fatal claims often include claims for loss of dependency based on the deceased’s income.  

In a non-fatal injury claim, damages are divided into two parts: losses that have already been incurred by the date of trial and future losses that have not arisen by the time the trial takes place.

The future losses are reduced by reference to actuarial tables to reflect, amongst other things, the fact that the claimant is receiving the damages in one lump sum rather than spread over decades into the future.

In fatal claims the courts have always calculated the losses from the date of death rather than the date of trial.  This has the result of under-compensating claimants as their losses incurred from death to trial are reduced to reflect early receipt, when in fact they are received late.  

The Supreme Court has just considered this issue in the case of Knauer –v- MOJ. 

The court highlighted that the current actuarial tables used to calculate future losses, known as the Ogden Tables simply did not exist when the House of Lords had previously considered this issue and set down the previous approach.  This has now changed, the Ogden Tables are widely used to calculate future losses in personal injury claims and there is no reason why the same approach should not apply to fatal claims too.  From now damages in fatal claims will be split into past (pre-trial) and future (post-trial) losses and only the future losses will be subject to the discounting for early receipt.

Damages in fatal claims will now increase as the defendant will not benefit from the reduction of damages for early receipt by the claimant in respect of losses incurred post death but pre-trial.

In most cases the difference will not be great, but this will not always be the case. In Knauer the difference in total damages was over £50,000.

There is now even more reason to look to settle these cases sooner rather than later as limiting pre-trial damages will help to reduce a defendant’s overall liability for damages on fatal claims.

Knauer (widower and administrator of the estate of Sally Ann Knauer, deceased) v Ministry of Justice [2016] UKSC 9