Lump sum awards for future loss of earnings
Details
In Irani -v- Duchon [2019] EWCA Civ 1846, the Court of Appeal provided guidance on the use of ‘lump sum’ awards in claims where there is weak evidence in support of a future loss of earnings claim.
The claimant was a young, highly educated, research engineer. He returned to work after several months off following an RTA, but was then made redundant. The judge at first instance accepted that the claimant’s injuries had contributed to his redundancy. Although he had found alternative employment, the break in the continuity of employment impacted his visa application for indefinite leave to remain in the UK and as a result he is not eligible to renew his visa on expiry in 2020.
It was argued by the claimant that he would likely suffer a reduction in his earnings on return to his home country, India. However, no expert evidence was served, with reliance placed on a letter, untested by cross-examination, from a friend with similar qualifications to the claimant and a number of job advertisements obtained from the internet.
While it was possible to calculate the earnings of a research engineer in the UK, Hamblen LJ ruled that ‘it is not surprising that the judge should conclude, as he did, that there was no proper evidential basis for making a finding as to the level of residual earnings which would be made in India.’ While the judgment confirmed that the general mode of assessment of future loss of earnings is to use a multiplier/multiplicand approach, ‘there will be no real alternative to a Blamire award if, for example, there is insufficient evidence or there are too many imponderables for the judge to be able to make the findings necessary to support the multiplicand/multiplier approach.’
Comment
There is often a reluctance to agree to evidence from ‘employment experts’ because they are expensive and reports are frequently of poor quality. However, one way or another, claimants must be put to a proper standard of proof as to claims for future loss of earnings. Where evidence does not exist, defendants should press for a lump-sum approach, and reserves should reflect that position.
This article was authored by Nicola Flood.
