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Willemse v Hesp, Court of Appeal, 11 July 2003

22 July 2003
The issues

Special Damages – Loss of Earnings – Future Loss – Smith v Manchester – Absence of clear pre-accident earnings pattern

The facts

The Claimant was a blacksmith and boat builder who had a road traffic accident in 1995 which left him with brain injury causing a modest deficient and a serious psychological reaction. The Claimant had a reduced ability to work and in particular a loss which was accepted by the neurologist concerning the Claimant’s artistic ability. His pre-accident earnings figures had been between 1990 and 1994 £4,297, £100, £1,137, £4,396 and £1,126. From 1992 he had begun work on a cutter. He claimed to have invested some 8,000 hours of work in it. The Trial Judge awarded £53,000 past loss involving a calculation of the actual hours work done per annum and a figure of £10 per hour reduced to a figure of £15,000 per annum to which he added the pre-accident average earnings and netted it down for tax to £14,500 a year.

An award of £110,000 was made for future loss of earnings, the Judge calculating the award on a multiplier-multiplicand basis. The Defendant appealed.

The decision

1. The Judge had been faced with a difficult task because of uncertain evidence before him. His approach was legitimate however. The Claimant had effectually exchanged income for future capital so that his receipts and earnings in the 4 years of construction were not a fair reflection of his earning capacity and could not been used as an appropriate basis to calculate the post accident loss. Although the Defendant had argued that the Claimant’s evidence as to his earnings was so unreliable no award should be made, this was a matter for the Judge, and the Court would not interfere. It was clear that unless the Judge had been satisfied that the Claimant had concealed true earnings over and above the time which he spent on building his boat, compensation at the level of £2,250 per annum would be a gross injustice to him. Whilst the Court would not have interfered had the Judge decided on the general state of evidence and his view of the Claimant that a Blamire v South Cumbria Health Authority award (“a global and somewhat impressionist sum”) would be appropriate neither would the Court interfere with the approach which the Judge had taken on this occasion.

2. The Judge’s approach as to future loss was flawed. This was a classic case for a Smith v Manchester Award rather than a selection of a multiplicand on an educated guess basis. He had undoubtedly suffered reduced earning capacity and was at an disadvantage on the future labour market. The level of his future earnings loss however depended on how far he tried to work full time and develop his career in a way in which he had not demonstrated before the accident (the Judge had noted that the Claimant had adopted a lifestyle which involved working when he had to but not working at other times). The appropriate award would be a lump sum of £50,000 and the appeal would be allowed to that extent.

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