Cost of Living: the effect of inflation on General Damages for PSLA

The cost-of-living crisis is a hot topic and has never been more impactive than in current times. In Blair v Jaber [2023] EW Misc 3 (CC) Recorder Jack considered the issue of whether the court should take into account inflation when looking at the Judicial College Guidelines and an award for Pain, Suffering and Loss of amenity. The Recorder held that it should.

It was emphasised that the current edition of the Judicial College Guidelines (16th edition) was published on 11th April 2022. As a matter of common sense, the figures contained therein had likely been finalised earlier. Since that time, the country had experienced inflation not seen since the 1970s. The Office of National Statistics figure for January 2023 released on 15th February 2023 showed the Retail Price Index at 13.4% per annum.

The Judge noted that the Judicial College Guidelines, unlike the Northern Irish Green Book, did not take future inflation into account. The question for the Recorded was whether he needed to consider whether the figures in the guidelines should be increased to take the unexpected and increase in inflation into account.

On that issue the Recorder held that “The Judicial College Guidelines are just that – guidelines. If there is a change in circumstances between April 2022 and today, that is a matter to take into account when assessing damages. The very substantial drop in the value of money which has taken place since April 2022 is just such a circumstance. Accordingly, the Judicial College figures needs to be increased by, in my judgment, about 12%.”

In light of the ongoing economic turmoil and inflationary demise the adjustment figure is likely to continue to grow. Whilst this decision is not binding the rationale is sensible and economically defensible. All parties, Claimant and Defendant alike, should be alive to this possible increase to awards and if necessary reconsider any Part 36 offers which may be lying, silently in wait.

A copy of the Judgment can be found here.

Final Call for Boarding: The Montreal Convention and missing out.

In Hallett -v- TUI Airways Limited the Court addressed the novel issue of amending the name of a Defendant after issue in a case covered by the Montreal Convention. The case highlights the important distinction between Convention claims and those under common law.

The Claimant brought a claim for damages for personal injury, it was the Claimants case that she was injured during a flight from Cyprus to London when an object fell from an overhead locker in the plane. Accordingly, proceedings were governed by the Montreal Convention and a two-year limitation period applied.

The Claimant issued within primary limitation, but erroneously issued against TUI UK Limited, the travel agent. The Claimant, prior to issue, but after the expiry of the limitation period, amended the name of the Defendant, without permission under CPR 17(1).  Proceedings were then served upon the correct Defendant.

The Defendant, seizing their opportunity, applied to strike out the amendment and to strike out the action as showing no reasonable cause of action.

The Judge’s opening gambit observed that the Claimant’s cause of action rested wholly on the convention: “Liability in respect of injuries sustained by passengers on board aircraft during flights is not governed by ordinary principles of tortious or contractual liability but by international conventions ratified by countries and incorporated in national law by statute.”

The Judge noted that Article 17(1) of the convention provided: “The carrier is liable for damage sustained in case of death or bodily injury of a passenger upon condition only that the accident which caused the death or injury took place on board the aircraft or in the course of any of the operations of embarking or disembarking”.

Further, Article 35 confirmed that “The right to damages shall be extinguished if an action is not brought within a period of two years, reckoned from the date of arrival at the destination, or from the date on which the aircraft ought to have arrived, or from the date on which the carriage stopped”.

The judge found, notwithstanding that proceedings were issued against the incorrect defendant prior to the expiry of the two-year limitation period, that the scheme and effect of Article 35 was one of strict liability. In effect the Montreal Convention provided that upon the expiry of the two year period the claim is extinguished and the Defendant has a complete substantive (as opposed to procedural) defence. The Judge commented that “It did not, unlike the Limitation Act 1980, act as a mere procedural bar to the remedy whilst leaving the claim in existence. The claim itself ceases to exist in law and cannot be resuscitated by reliance on the CPR or any other domestic law”.

The judge did not accept the Claimant’s submissions that by virtue of permission through the CPR the substantive prescription period was not engaged. The judge held that Montreal Convention was a self-contained code and there was no room for the application of any domestic law rules or principles. To have accepted the Claimant’s position would have allowed domestic rules to override the statutory provisions of the Montreal Convention.

The Judge concluded by ruling that “This is a case where there is no scope in my judgment for the Court to do anything other than strike out the claim as disclosing no reasonable cause of action against the defendant because the provisions of the Montreal Convention make clear that when these proceedings were amended so that the correct defendant was included the limitation period in the Montreal Convention had expired. There was no legal cause of action at that stage that the claimant had against the defendant. It follows, therefore, in my judgment that the claim should be struck out pursuant to Civil Procedure Rule 3.4(2)(a).

 This case should hopefully serve as a reminder of the need to obtain the correct name of the Defendant from the outset.

A copy of the judgment can be found here.