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A Train & Sons Ltd v Fletcher, Court of Appeal, 24 April 2008

27 May 2008
The issues

Damages – fatal accident – interest rate – Cookson v Knowles – whether interest on damages for loss of financial dependency should be at half rather than full rate.

The facts

The Claimant was the widow of Carl Fletcher, who died on the 21st October 2004 from the effects of a malignant mesothelioma resulting to his exposure to asbestos in the course of his employment with the Defendant. The issue for the Court of Appeal was the rate of interest to be applied to damages awarded for loss of financial dependency. The wider issue before the Court of Appeal was whether the time was ripe for an alteration to be made to the Cookson v Knowles guidelines, whereby the multiplier should be calculated from the date of Trial and not from the date of death. The Respondent however had accepted that it was not open for the Court to make that change. The Claimant’s claim for financial dependency was agreed as follows:-

£35,184.10 in respect of the past loss of financial dependency from date of death to date of Trial;

£39,213.62 in respect of the further loss to the date of retirement;

£122,689.58 in respect of the loss after retirement.

The three capital sums totalled £197,087.30.

It was agreed that the appropriate full rate from date of death to Trial was 14.75% and the half rate 7,375%.

The Judge had rejected the Defendant’s argument that the award of interest on damages for loss of financial dependency should be at half rather than the full rate and limited only to the past loss of financial dependency (the £35,184.10). He awarded interest at the full rate on the entire sum.

The decision

In exercising his discretion as the Judge did, he did so contrary to a principle on which the House of Lords had left no room for doubt, namely that the nature of the award of that part of the damages claim which related to post-Trial losses was a claim for future loss upon which an award of interest was therefore inappropriate.

Similarly, an award of more than half the full interest rate on the total pre-Trial loss at more than half the short term interest rate led to over compensation of the Claimant. The Judge’s discretion had been exercised contrary to binding authority as to the principle upon which such discretion should be exercised.

It had been urged upon the Court of Appeal to reconsider the guidelines in Cookson. It was not a course properly open to the Court of Appeal since the Court of Appeal was also bound by the authority of the House of Lords.

Appeal allowed.

Comments

Sir Mark Potter, President of the Family Division who gave the main Judgment, went on, obiter, to note the Law Commission criticisms and also to note the proposals for reform the recommendations and the solution produced by the Ogden Working Party and included in the 5th Edition of the tables which was attractive but predicated upon a departure from the practice clearly laid down in Cookson v Knowles. Whilst, in Sir Mark’s view, the time was ripe for reconsideration, this Appeal had not been the appropriate occasion.

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