Civil Liability Bill [HL]

Lord Hope of Craighead Excerpts

Committee: 2nd sitting (Hansard): House of Lords
Tuesday 15th May 2018 Lords Chamber

[Lord Hope of Craighead (CB)]

My Lords, I want to draw attention to one or two other passages in the Government’s response, to which the noble Lord, Lord Hodgson, referred in his excellent introduction. Two features caught my eye. One is in paragraph 45. The Justice Select Committee had drawn attention to quite strong representation for the Civil Procedure Rules to make it a requirement that PPOs be offered; its advice was against that, because it was reasonably clear that not every case made a PPO appropriate—one has to be selective; some cases are better suited than others. The point of mentioning that is that one could adopt the approach of amending Section 100 of the 2003 Act, which is the basis for the award of PPOs, to toughen up the requirement that they be offered in every case, but that is not what is being suggested and, I think, rightly so.

The other question is whether rules of court are best equipped to deal with the problem. That is why I draw attention to what is said in paragraphs 50 and 51 of the Government’s response. In passages that are written out in heavy print and underlined, they undertake to,

“investigate the quality and effectiveness of the advice currently available”,

with a view to endorsing,

“guidance on standard practice to ensure that claimants are properly informed”.

Will the Minister expand a little on what the Government had in mind in that passage? Was it guidance rather than amendments to the Civil Procedure Rules, guidance to lie alongside the Civil Procedure Rules or guidance which will inform the committees responsible for the revision of those rules?

What comes through from that and the following paragraph is that further investigation is in the mind of the Government. A little more information may be needed before the rules are revised in the way that the noble Lord, Lord Hodgson, has in mind. If the Minister could expand a bit on that, it would be very helpful.

[Lord Judge (CB)]

My Lords, I apologise to the Committee that I was not here for the first 90 seconds of what the noble Lord, Lord Hodgson, had to say, but I came puffing in as quickly as I could.

In our discussions so far, which I entirely understand and support, one feature has not yet been mentioned: the advantage of the PPO in the process from the point of view of the unfortunate man or woman who has suffered serious or catastrophic injuries. Both at the Bar and as a judge, one thing that you have to look at is how long the unfortunate individual concerned will actually live. I am sorry to say so, but when you talk to your client and say, “We have to discuss how long you will live”, or to the parents of a child who has suffered catastrophic injuries, “We are discussing how long your little boy or your little girl will live”, you are treading on what is obviously deeply sensitive ground. The answer is that it has to be discussed if you are proceeding by way of lump sum, because the calculation of damages depends significantly on whatever the medical experts say the life expectation of the man, the woman, the little boy or the little girl is likely to be.

The medical experts I dealt with were men and women of the utmost integrity. They would do their best. They would say, “Well, the best I can do is X”, or Y or Z. What you discovered after a little while doing these sorts of cases was that, actually, what they were doing—and who can blame them?—was taking an average: “We have had so many patients aged between 21 and 25 who have suffered these sorts of injuries, and they have lived for so long and then they have died”. So in addition to the sensitivities that go into a discussion of how long will the victim—the plaintiff, as they used to be in those days—suffer, be alive, and how long will the damages have to cater for his or her interests, there is also the uncertainty of the medical evidence, because no doctor can tell you.

I still remember a very distinguished surgeon from Stoke Mandeville, who, when I asked him this question in a conference just before I became a judge, said, “Well, we are asked the most ridiculous questions. We do our best. We offer you the best. The truth is that we do not know when this man or this woman’s will to live will go. When the will to live goes, that is when they will die. Some will wish to live and will have the will to live for longer than others, so what we are offering you is the best we can do”. He did not say, and it would not be fair to say, that it is speculative: it is the best they can do but, inevitably, it is almost certainly not going to be right. The end result is that the damages will be too much or too little. The great advantage of the PPO system is that it caters for however long this unfortunate injured person actually lives. I support the idea behind this amendment.

--- Later in debate ---

[Lord Mackay of Clashfern]

My Lords, the Act which this Bill amends gave the Lord Chancellor this power. I suppose that, at that time, the Lord Chancellor had intimate relations with the judiciary—but he also had the responsibility of accounting to Parliament if there was a question about the matter. The connection between the Lord Chancellor and the judiciary has somewhat diminished since that time, but the Lord Chancellor still has a primary duty in relation to the judiciary that other members of the Government do not.

It is also important to have accountability in this matter. As my noble friend has just said, if the Lord Chancellor ignored the advice of the panel, he might have good reason for doing so, but it would be very difficult for him to explain it, because one would assume in this case that he or she would accept the judgment of the panel and he or she would be answerable to Parliament.

I share my noble friend Lord Faulks’s difficulty in relation to medical help. It is for the judge to decide on the length of time or the nature of the requirements for care, treatment and so on that a person may have. This particular exercise is primarily for those expert in the matter of investment.

I have perhaps interpreted the new schedule to which the amendment applies rather too generously. I assumed that there would be different rates of return fixed for different classes of case and that it might therefore be possible to change them on review—for example, to have no rate of return for a particular class or to enlarge the class that another rate of return applied to. It would be extraordinary if one could abolish this duty by the exercise of paragraph 8(2)(a). I do not think that that was intended—but my noble and learned friend may say that it was.

[Lord Hope of Craighead]

My Lords, perhaps I may add a footnote to the point made by the noble Lord, Lord Faulks, in favour of the Lord Chancellor having the decision. Paragraph 6(2) of the new schedule, on the way in which the panel is supposed to work, states:

“In the event of a tied vote on any decision, the person chairing the panel is to have a second casting vote”.


We then look at who is to chair the panel and see that it is the Government Actuary. I would much rather the Lord Chancellor assumed ultimate responsibility than the matter be determined in the event of a tied position by the Government Actuary. So the structure as set out supports the line taken by the noble Lord.

--- Later in debate ---

[Lord Hope of Craighead]

I have one point to add to the remarks of the noble Lord, Lord McKenzie, on the effect of the different approach to the level of risk. One factor which was mentioned by Lord Lloyd of Berwick in Wells v Wells was the need to have a relatively stable, constant fund from which funds could be drawn as the need arose over a long period of time. The risk he was contemplating in that part of his judgment was not that of the funds running out, just that the value of the fund would diminish as the stock market went down. In its turn, this would prejudice the viability of the fund to maintain itself at the appropriate level as time went on. The risk we were contemplating then, in looking at the appropriate rate of return, was differentials in performance which would affect the ability of the fund to meet ongoing costs which would not fluctuate. They were the constant costs of equipment maintenance or nursing services which the injured person had to meet from time to time: a level rate of costs, against a fluctuating value in the fund available to pay for them.

There is much to be said for reducing the level of risk to the minimum possible compatible with the aims of the Government, to avoid the problems of fluctuation which affect the viability of the fund. I mention this because it is another factor which lies behind the point made by the noble Lord, Lord McKenzie. As the noble Lord, Lord Faulks, has pointed out, the advantage of the Wells approach is that investment advice was not needed. I am not quite sure how these things are structured, but if the fund were to be put in the hands of an adviser, there is usually a performance factor taken out of the management of the fund. It is not so much investment advice as the cost of managing the fund. The larger the fund, the more likely it is that the best way of handling it is to put the whole fund into the hands of an investment adviser who would simply manage it accordingly.

It is rather difficult to extract from that a recoverable figure of the kind that the amendment in the name of the noble Lord, Lord Faulks, is directed at. There is a lot to be said for just taking that factor out of the award altogether and leaving it up to the individual to decide how best to have the money managed. If it is a management figure, then that is all right: it is just part of the choice that the injured person makes. It should not be added in as an additional element of damages.

[The Earl of Kinnoull]

My Lords, I will speak briefly to Amendments 80 and 81 in my name. I congratulate the noble Lord, Lord McKenzie, on his heart-rending speech, but it seemed only to go back to saying, “My goodness, PPO is a good idea”. So many of the risks which the noble Lord identified would be sorted out by that, but that is in the past.

New Schedule A1 to the Damages Act is inserted by Clause 8(2). At Second Reading, I said that I was worried that paragraph 3(3) did not give sufficient clarity to what was being asked for in the investment. I was concerned that, without that clarity, there could be a plethora of new Wells v Wells cases, with people trying to grapple with what was actually meant. Amendment 80 probes the word “investments” in the phrase,

“the assumption that the recipient of the relevant damages invests the relevant damages in a diversified portfolio of investments”.

We should at least be clear that those investments were debt securities, not equities.

Secondly, I thought it would be helpful to try to define a “very low level of risk”. That does not actually mean anything to me, with my background, and I suspect it does not mean anything in law. I have tried to define it as the level of risk you have when you buy UK Government debt security. These are probing amendments and I regard this as a discussion, but clarity in this area of the Bill would be greatly to the advantage of everyone concerned.