press release
Court case confirms 'double jeopardy' rule applies to damages payments
21 December 2007
A recent court case concerning a Midlands care worker and her
employer, Wolverhampton City Council, has clarified a complex area
of law regarding the payment of contractual benefits, such as sick
pay, in cases of multiple claims.
The ruling from the Court of Appeal is good
news for businesses as it confirms that employees cannot bring
about further claims against their employers once a subsequent
event takes place.
Suzanne Hawkins, the solicitor from Midlands
law firm Browne Jacobson who acted for the defendant, said:
“This ruling is good news for the insurance industry as it
brings clarity to an area of law that has been in confusion for
some time. Clear rulings on complex issues such as contractual
benefits should be welcomed by insurers and employers as they
provide guidance on future cases and also deter employees from
bringing spurious or speculative claims to court.”
Mrs Brazier, a care assistant, suffered an
acceleration injury to her back while at work in 2003. She
had continued to work, undertaking lighter duties until this work
ceased to be available and was paid sick pay thereafter and given
notice of ill health retirement.
Unfortunately, during this notice period Mrs
Brazier was involved in a road traffic accident which rendered her
unfit for work of any kind. While it was initially judged
that Mrs Brazier should be paid the sick pay and light duty
earnings which she would have received at the end of the
acceleration period, the recent Court of Appeal ruling has
overruled the original judgment.
It was conceded by Mrs Brazier that the judge
had been wrong and that, on his findings of fact, if one ignored
the road traffic accident, the correct hypothesis was that she
would, at the end of the acceleration period, have been working in
suitable light employment, earning sums at least equivalent to
those she had received as a care assistant. In effect, the
initial injury had simply accelerated Mrs Brazier’s receipt of sick
pay and light work earnings.
The claimant advanced an alternative argument,
however, to the effect that she would, but for the accident at
work, have had her full contractual sick pay entitlement available
to her at the date of the road traffic accident. Therefore,
but for the first accident, she would have received a full year of
sick pay following the road traffic accident. As a
consequence of the first accident, she was predestined to be
medically retired within three months when the road traffic
accident occurred and had therefore been deprived by the first
accident of the “contractual benefit” of her full sick pay. The
road traffic accident, it was argued, was merely an event occurring
between tort and trial that made a contingent loss a compensable
head of damage.
The Court of Appeal rejected that submission,
refusing to recognise a claim for “loss of contractual benefit” in
these circumstances. A claim for damages was about money and the
critical question was “what money has the claimant lost?” During
the period following the road traffic accident the claimant was not
losing any money by reason of the first accident, as she would, but
for that accident, have earned no less than she had in her job as a
care assistant. Rather, any loss during that period had to be
attributed to the road traffic accident and the claimant had to
look to the defendant in that claim for recompense in that
regard.
Martin Porter QC, acting on behalf of
Wolverhampton City Council commented: “It is now clear that a
contractual arrangement that would confer a benefit on the
occurrence of a further tort is not relevant when assessing the
damages payable by either the original or subsequent
tortfeasor. The position may be more interesting if the facts
are such that the benefit is payable as a consequence of subsequent
non-tortious injury or disease.”
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