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Economy, Energy and Fair Work Committee 22 January 2019

22 Jan 2019 · S5 · Economy, Energy and Fair Work Committee

Item of business

Damages (Investment Returns and Periodical Payments) (Scotland) Bill: Stage 2

Regan, Ash SNP Edinburgh Eastern Watch on SPTV

Once again, I thank Dean Lockhart for providing a bit more detail on his amendments. On amendment 15, it might be helpful if I first summarise how awards of damages for personal injury may be made. The methods of award—that is, either a lump sum or periodical payment—are not mutually exclusive, and a pursuer who receives their award by way of an order or agreement for periodical payments will rarely receive their entire award in that way. At the point at which a settlement figure is agreed or ordered, the pursuer might already have experienced losses—for example, their past salary or past care or treatment—and their settlement might therefore include a capital sum to allow them to purchase a piece of equipment to assist them. Such payments would be made in a lump sum, and only future pecuniary losses could be made in the form of periodical payments. Indeed, the award or settlement might provide for those future losses to be addressed through a mix of lump sum and periodical payments. That flexibility for the courts is maintained in the bill’s provisions relating to the variation of periodical payments, and if we were to restrict or hamper that flexibility, it would mean that, if a court were presented with evidence that a pursuer’s losses had increased due to a change in their condition, it would no longer be open to the court to award a lump sum in addition to the periodical payments as originally awarded. It would be restricted to a choice between varying the level of the periodical payments or replacing the whole of the periodical payments with a lump sum when increasing the level of compensation. Additionally, the court can vary an order or agreement only where there is actual change in the pursuer’s condition and the change itself results in significant over or undercompensation. Proposed section 2F of the 1996 act, which is inserted by section 4 and relates to orders, and proposed section 2H, which relates to agreements, do not permit the court to reopen the original award altogether. Therefore, what is set out in amendment 15 would not be the right approach. On amendment 16, the bill already includes a causation link to the original injury on two fronts: the original court order must include provision enabling an application to be varied in the future, and any change in condition has to result in significant over or undercompensation. The bill does not change the underlying principles in Scots law that require a causal connection between the injury and the loss for which the pursuer is to be compensated. Therefore, if the original order awarding periodical payments includes no provision for variation to be made in the future, the court might not even entertain an application from either party to vary. Where the court enables future variation in this way, it must specify the sort of change in the pursuer’s condition that must occur before an application can be made. In so doing, the original court order will be acting in the light of and subject to the essential rule in law of a causal connection between the injury and the loss. As a result, there is already a clear and necessary link between the original injury and the circumstances that might result in variation. The reference in proposed section 2F(3)(b)(ii) to “the injured person” being “significantly over- or under-” compensated also links the variation to the original injury and makes it clear that what we are talking about is a significant, not trivial, change to the pursuer’s condition. In addition, amendment 16 refers to a change being “attributable” to the injury, but it is not clear how that would work where the change is actually an improvement, as that would not be “attributable” to the injury. Put simply, the bill needs say nothing more to achieve what amendment 16 seems to be designed to achieve and in my view, therefore, it is not needed. For the reasons that I have given, I urge the member not to press amendment 15 and not to move amendment 16. If he does so, I ask the committee to reject the amendments.

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Economy, Energy and Fair Work Committee 22 January 2019

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