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Supreme Court overturns ‘illogical’ Cookson principle

Controversial House of Lords rulings dismissed as being out of touch with the present legal climate

24 February 2016

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The Supreme Court has unanimously overturned the much-criticised, long-established, and 'illogical' Cookson principle in a ruling against the Ministry of Justice (MoJ).

The House of Lords (HoL) rulings in Cookson v Knowles [1979] AC 556 and Graham v Dodds [1983] 1 WLR 808 held the multiplier for dependency claims under the Fatal Accident Act 1976 should be assessed by reference to the date of death as opposed to the date of trial.

The Cookson decision in particular has long been the subject of legal debate as it meant many claimants have ended up significantly worse off because a lower multiplier was applied to the calculation of their dependency losses.

Calculating damages from the date of death, rather than the date of trial, means a claimant suffers a discount for early receipt of money that will not be received until after trial.

The Supreme Court heard that between 1997 and 2007, Sally Knauer was employed by the MoJ as an administrative assistant at Her Majesty's Prison, Guy's Marsh.

During her employment Knauer was exposed to asbestos and was subsequently diagnosed with malignant mesothelioma in March 2009. She died on 28 August 2009 at the age of 46, leaving behind her husband and three sons.

The MoJ admitted liability in December 2013. In a hearing before Mr Justice Bean in July 2014, the appellant - Knauer's widower - and the ministry agreed the annual figure for the value of the income and services lost as a result of Knauer's death.

However, a dispute arose between the parties as to whether the multiplier should be calculated from the date of death or from the date of trial.

Giving a joint judgment, Lord Neuberger and Lady Hale said the court would depart from Cookson and Dodds as the rulings were 'illogical' in the present legal climate and led to 'unfair outcomes'.

The justices noted that the previous rulings were decided in a different era, when the calculation of damages for personal injury and death was 'nothing like as sophisticated as it is now' and at a time when the use of actuarial evidence or tables was discouraged.

The court said that thanks to the Civil Procedure Rules 1998, the courts can now insist that parties keep to timetables. Furthermore, the court described concerns that a claimant may recover greater damages if a trial is delay as 'irrelevant' thanks to the implementation of the Ogden Tables .

In his latest SJ lawbrief, Leigh Day partner Vijay Ganapathy had hoped the Supreme Court would overturn the Cookson principle as 'its harsh effects are clearly evident in Mr Knauer's claim'.

Speaking to SJ following the judgment, Ganapathy said it was 'great' to see the Supreme Court acknowledge how drastically the calculation of damages has changed since the Cookson ruling.

'Calculating quantum is now much more complex than it was in the past. so it is a welcome development to see the courts realising a change was necessary.

'Cookson has had some harsh effects,' he continued. 'In many cases, the financial and services dependency elements form the lion's share of the claim which means applying a smaller multiplier results in a considerable discount to the overall damages claimed.

'This affects disabled dependants particularly badly who require substantial financial support.'

Ganapathy added: 'Also, discounting the sum awarded between the date of death and trial for accelerated receipt was wholly illogical, given the claimant does not receive this sum until trial.

'This decision means High Court judges can no longer feel their hands are tied by Cookson and they can adopt a more logical approach to calculating damages.'

Colin Ettinger, a partner at Irwin Mitchell said: 'The decision supports what we have been arguing in our fatal cases for several years, namely that the law should be changed to reflect the very real emotional and financial impact the loss of a loved one can have on families, who often struggle to rebuild their lives.

The Supreme Court’s decision supports a basic principle that has been with us for many, many years to compensate people, so far as money can, so that they are restored to the position they were in before the death of a loved one.'

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