On behalf of the Claimant, it was submitted that the Court was being asked to adopt a different methodology and not being asked to change the discount rate. Without delving into the same too much, the formula was based upon the difference in price between the old property and the new property, the relevant life multiplier and the discount rate. The Defendant’s primary case was that the Court is bound by R v J as no exceptions apply. Winston Hunter QC. Swift v Carpenter (2018) relates to a road traffic accident in October 2013 in which Swift sustained serious leg injuries leading to a below-knee amputation. Whilst discount rates remained positive at 2-2.5%, the R v J formula avoided windfall, but a claimant was often forced to use funds from other heads of claim (e.g. Let us assume that her pre-injury property was worth £200,000 but the new property she now requires costs £300,000. This resulted in inadequate levels of damages to those who suffered serious injuries, going against the laid down maxim that damages awarded should be fair and reasonable. Latest News. (a)the description of future pecuniary loss involved; (b)the length of the period during which future pecuniary loss is expected to occur; (c)the time when future pecuniary loss is expected to occur. This meant claimants who suffered the most serious, life-changing injuries requiring the purchase of alternative suitable accommodation were, for years, inadequately compensated. (2)Subsection (1) does not however prevent the court taking a different rate of return into account if any party to the proceedings shows that it is more appropriate in the case in question.  The Court queried whether there could be a mechanism to allow the same; whilst it seems theoretically possible on the basis that a subsidiary company could be set up to buy the reversionary interest, it would be difficult and the Defendant said the practical way to handle this matter is to deduct a sum rather than forcing reluctant parties to invest. The remote streaming videos remain on YouTube and, if you are a member of PIBA, the skeletons are available for your perusal. The claim was set down as the capital difference between the new and existing property x discount rate x life expectancy. In the first case, JR -v- Sheffield Teaching Hospitals NHS Foundation Trust (2017) the judge considered himself bound by Roberts. The Defendant noted that, whilst the Court has the power to adopt a different discount rate as per A1(2), that is for the claim as a whole i.e. The Claimant suffered serious lower limb injuries in a road traffic accident in 2013 which resulted in her left leg being amputated below the knee. Follow us Twitter LinkedIn Instagram Facebook Youtube. The opposition to this is simple; the Claimant will be overcompensated. On behalf of the Claimant, it was submitted that R v J should no longer apply as the parameters within which it was meant to operate no longer exist, that being there is a negative discount rate. The Court is not prohibited from doing that by the Damages Act; common law is doing what it has always done: reacting to events and circumstances as they change. Mrs Justice Lambert concluded that she was bound by Roberts v Johnstonewhich resulted in a nil award. The long-lived status quo – Roberts v Johnstone. Thu, 23 Jul 2020, Toby Chaplin (by his mother and litigation friend, Diane Chaplin) v Ben Pistol, Allianz Insurance Plc, Date: Accommodation Claims: Swift v Carpenter; Accommodation Claims: Swift v Carpenter. The claimant sustained serious injuries leading to a below knee amputation of the left leg in a road traffic accident in 2013. As a personal injury lawyer, acting on behalf of those seriously injured in road traffic collisions, especially motorcyclists, I welcome the Swift decision. Compensation should be fair and reasonable but prior to Swift v Carpenter, it was anything but. Their decision changes the law for people requiring special accommodation following an injury. Find all the latest news about Deans Court Chambers here. They said the setting of a different discount rate for special accommodation is a power which was conferred on the Lord Chancellor (primarily under added new subsection (4)) and is not a matter for the Court. Linkedin; Twitter; Google+; Facebook; Archive. SWIFT v CARPENTER. Part 36: enhancements payable under CPR 36.17(4) in respect of interest on damages and costs where the claimant had beaten her own Part 36 offer. Swift v Carpenter: Court of Appeal not bound by Roberts v Johnstone. For those of you on Twitter, our timelines have been filling with practitioners tweeting about the long awaited hearing of Swift v Carpenter, which ran from 23 – 25 June 2020 in the Court of Appeal, and the implications it will have on the accommodation head of loss in serious injury claims. Roz Boynton details the key compensation points in a case in which the claimant was severely injured in a road traffic accident in 2013. The calculation allows the injured person to claim full extra costs of accommodation less a discount to reflect ‘reversionary interest’. Ampersand Bitesized – Complications of accommodation costs – understanding Swift v Carpenter Archie MacSporran – recorded on 23rd October 2020. Their decision changes the law for people requiring special accommodation following an injury. She was awarded damages in excess of £4 million but, significantly, received nothing for the capital costs of accommodation. Building C (MAN 35), Northampton Road, Central Park, Manchester M40 5BP Mon, 22 Jun 2020. Chambers News. She cannot simply recover the additional capital cost of the new house because that would amount to double recovery: she would receive an additional capital sum of £100,000 and would also have an asset worth £100,000 more than her previous house. That would create a lower initial value for the reversionary interest than the methodology put forward by the Defendant (because if you are relying on a higher yield then you start with a lower initial value). The same example for our 30-year-old male allows him a claim of £233,300 for accommodation costs. A simple example of reversionary interest is this: I am the life tenant of a property and I am entitled to reside there for as long as I live. They said that as the Claimant has now purchased her new property without borrowing, and will only need to borrow much later in life, she will be a saver for a long period (and thus achieve a gain) and only borrow for a shorter period. 12.03.2019 ... Twitter Tweets by ByromStreet Our Members. for all heads of losses, not just one. From around 2017, with the advent of negative discount rates at -0.75%, the R v J formula proved completely unworkable. UK & Europe. In an unsurprising decision, the Court of Appeal has refused the Defendant in Swift v Carpenter permission to appeal the landmark decision handed down last month. (4)An order under subsection (1) may in particular distinguish between classes of case by reference to—. Date: 21 October 2020 @ 15:00 Duration: 1 hour Presenter: Darryl Allen QC The Court of Appeal recently ruled in Swift v Carpenter. The Court of Appeal have held that they are not bound by Roberts v Johnstone. They say that is not merely a judicial guideline. By John Hyde 2020-06-23T13:25:00+01:00. The recent High Court decision in Swift -v-Carpenter (2018) is the latest (and only the second) case to reach the judiciary on this point since the discount rate change. The Claimant is left with a negative figure for accommodation. The matter proceeded to appeal, and after various delays, was heard remotely from 23-25 June 2020 in the Court of Appeal, with several witnesses, consisting inter alia, of economists and actuaries. It is then for the Claimant to either sell or retain the reversionary interest. It is likely Swift will be followed in the Scottish Courts heralding a more equitable solution to a problem that has vexed personal injury lawyers for years. That principle, they said, is that the multiplicand is determined by the discount rate, which is set by the Lord Chancellor. 2020. The bad news is that the hearing was adjourned (for the parties to file further evidence). The decision of the Court of Appeal in Swift v Carpenter has rewritten the rules for the calculation of future accommodation costs. Another option was for the Defendant to pay the Claimant the full additional capital cost. Read More. Background A property needs to be single storey with additional rooms for carers, storage and a therapy room. One viable solution the Claimant put forward is that the Claimant should be awarded the capital cost with a deduction for the market value reversionary interest; as provided for by the report of Mr Watson, an actuary who has expertise in valuing and auctioning reversionary interests. The below is a streamlined and much less eloquent version of some of the arguments put forward. The Defendant relied upon the “fair and reasonable” methodology put forward by their expert Mr Robinson, an actuary, which they said has as its aim balancing the interests of the life tenant and the remainderman. By the time the appeal was heard, the Claimant had bought a property suitable for her needs, without having to borrow. The claimant, Charlotte Swift, sustained life-changing injuries at the age of 39 when she required a below the knee amputation following a road traffic accident. 14.06.2019 James Rowley QC - A Quantum Update - June 2019 . Swift was awarded more than £4m in damages In our example of a two-bedroom unsuitable flat valued at £150,000 and a four-bed bungalow valued at £400,000, pre-2017 and using the R v J formula, the claim for future accommodation costs for a 30-year-old male claimant would be £185,000. Date: Barlow v Wigan MBC – an important Highways case. The article below attempts to explain the background, simplify some of the new proposals and look at how accommodation claims may look in the near future. It was also submitted that, if it is not assessed at market value, there will be more cases where the gap between the money the Claimant has and the money the Claimant needs to buy a property  is going to be unbridgeable.  If the reversionary interest is valued at a greater sum, the Claimant will be left with less capital. Insurance & Reinsurance. In the Swift case this is £801,913 (£900,000 less £98,087). Stand by your schedules and counter-schedules, dig out those old Part 36 offers and get ready to apply to increase your costs budgets; the 8th edition of the Ogden Tables (“Ogden 8”) may impact on all three. In Swift v Carpenter the appropriate discount rate was held to be 5% which can be represented as 1.05. 23/10/2020 . It seems that, if an alternative methodology is to be adopted by the Courts rather than R v J or an award of the full capital cost, a reversionary interest calculation is the clear front runner. Where a claimant sustains serious injury, their accommodation may no longer be suitable for their needs. Take as an example, a female Claimant who is 35 years old at the date of trial, who has sustained a serious injury which means she requires single storey accommodation. The first hurdle for the Court to decide was whether R v J should still be adopted. 09/10/2020. share Twitter LinkedIn Email. The court’s decision on Swift v Carpenter today is one of the most significant on the calculation of accommodation claims since 1989 when Roberts v Johnstone applied the discount rate. London office . Prior to the appeal being heard, there were many options mooted as alternatives to R v J. As a lawyer specialising in complex and serious injury cases, I was delighted to read the landmark judgment of the English Court of Appeal in Swift v Carpenter (2020). They also said the principle set out in Thomas[2] is binding on the Court. It was worth the wait. Accordingly, the deduction from the initial capital cost will be lower. Bill Braithwaite QC outlines the current issues in following Roberts v Johnstone for accommodation claims ‘The problem of Roberts v Johnstone has become important because of the gradual disparity between damages for pain and suffering and house prices – a sad reflection on the law’s approach to damages for injuries (or a broken property market? ... From Twitter @CrownOfficeCh. For those of you on Twitter, our timelines have been filling with practitioners tweeting about the long awaited hearing of Swift v Carpenter, which ran from 23 – 25 June 2020 in the Court of Appeal, and the implications it will have on the accommodation head of loss in serious injury claims. Intervention during the hearing was interesting in this regard; dealing with whether the previous cases were binding given that the argument put forward was to disregard the R v J methodology entirely and querying whether R v J was proposing the best approach, as opposed to the only approach. The opening of the Swift v Carpenter [2018] EWHC 2060 (QB) appeal was live streamed from the CA this morning.Specialist personal injury barrister Hannah Godfrey explains the good news, and the bad.. Available to view on demand (registration required) Associate solicitor Jonathan Bamforth shares his view on the Swift v Carpenter appeal and the need for fair compensation for clients. swift v carpenter (protective costs orders) : full case details / the decision This judgment concerned an application by the appellant for a protective costs order (“PCO”) in an appeal against part of a decision by Mrs Justice Lambert DBE of 2 August 2018 on the trial of a … That methodology arrived at a yield of 1.1% based on the current discount rate. For example, a severe spinal cord injury confining an individual to a wheelchair, renders a two-bed upper flat unsuitable. The Defendant says the problem with that approach is there is no real market and accordingly no market value can be calculated. The Defendant said that would not work in practice as it would be akin to a shared ownership scheme, which it has been agreed is unworkable, primarily for regulatory reasons on part of the Defendant and a reluctance on the part of the Claimant to have an ongoing relationship with the insurer. Darryl Allen QC of Farrar’s Building […] Roz Boynton is a solicitor at Road Traffic Accident Law (Scotland) LLP, Currency exchange rates updated 45 minutes ago, Road Traffic Accident Law LLP appoints associate solicitor in Aberdeen, Growth of road traffic legal firm vindicates move to set up specialist services, Staff at Road Traffic Accident Law Scotland smash active challenge, Solicitor (0-2 years PQE) – Personal Injury, CPD Packages from Law Society of Scotland, Ampersand Bitesized – A Swift Response – the bits not dealt with in the Court of Appeal decision. If the conventional R v J calculation was adopted, the Claimant would recover a nil award for accommodation. Samuel Jones – A Case law update: Swift v Carpenter Posted on Friday, October 23rd, 2020 at 12:00 pm The Court of Appeal recently handed down its long-awaited judgment in Swift v Carpenter [2020] EWCA Civ 1295 . The position of the Claimant was quite clear in this regard; if the Court accepts that the Claimant has suffered a loss in having to purchase suitable accommodation as a result of the injury, then R v J leads to the Claimant not being compensated for a loss, which cannot be right under the purpose of tortious damages. By way of a very simple working example, the R v J calculation would work as below (Assuming the Claimant’s life expectancy is unaffected by her injury and the discount rate is 2.5%): Difference in capital cost of accommodation: Price of new property (300,000) less price of original property (£200,000) = £100,000, £100,000 x discount rate (2.5%) x relevant life multiplier (29.31) =  £73,275. Download as pdf. This is then subtracted from the additional capital figure leaving the claimant with amount of the accommodation award. In Swift v Carpenter, Ms Swift had a capital shortfall of £900,000. The problem was compounded by negative discount rates. However, for those who have only joined the PI practitioner world in the last few years, there is an awful lot to catch up on. She explains the judgment and provides a worked example. 020 7650 1200. As a lawyer specialising in complex and serious injury cases, I was delighted to read the landmark judgment of the English Court of Appeal in Swift v Carpenter (2020). This is the simplest proposal. The discount rate (1.05) is then multiplied with itself - … Whilst submissions were heard on equity release, a substantial part of the hearing focused on the potential option of a reversionary interest, which the parties agreed could be a viable solution. Swift v Carpenter judgment Download (842 KB) Talk to us in confidence. To avoid such a windfall, Roberts v Johnstone (1989) set out a formula for providing compensation for future accommodation costs based on the loss of the use of capital used to purchase a more expensive suitable property. Swift v Carpenter appeal could ensure Claimants properly compensated. The relevant passage from the Damages Act is below: (1)In determining the return to be expected from the investment of a sum awarded as damages for future pecuniary loss in an action for personal injury the court must, subject to and in accordance with rules of court made for the purposes of this section, take into account such rate of return (if any) as may from time to time be prescribed by an order made by the Lord Chancellor. It followed that no award was made in respect of the additional capital cost of purchasing the new property. This is where it gets tricky. There were several methods proposed to the Court for valuing that reversionary interest and just two of the options are covered below. The Claimant said there is no evidence of this methodology being applied to produce a value in the case before the Court, and all calculations are illustrative only. The Claimant also put forward a hybrid solution: if the Defendant is to have the benefit of the deduction based upon the valuation of the reversionary interest, then it should be on the basis that Defendant is prepared to purchase the reversionary interest. After nearly 50 years of uncertain damages in cases of this nature, Claimants will now receive fair and reasonable compensation to purchase special accommodation. In other words, nil recovery for future accommodation costs. (3)An order under subsection (1) may prescribe different rates of return for different classes of case. Date: The proposal is effectively that the Defendant will give the Claimant the additional capital required to purchase the new accommodation minus the value of the reversionary interest. Swift v Carpenter concerning accommodation claims. 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