Pickett v British Rail Engineering Ltd

A claimant whose life has been tortiously shortened may recover damages for earnings lost during the years in which the claimant would probably have worked but will not survive. The loss is a measurable diminution of earning capacity and is not confined to the shortened period of survival. The award should reflect ordinary contingencies and deduct the claimant’s probable personal living expenses.

Inflationary adjustment preserves the real value of damages, while interest compensates for being kept out of that value. Inflation therefore supplies no general reason for withholding interest. An appellate court should disturb a trial judge’s assessment of non-pecuniary damages only for an error of principle or fact, or a wholly erroneous estimate.

Pickett v British Rail Engineering Ltd concerned an employee who developed fatal mesothelioma after prolonged occupational exposure to asbestos dust. His employer admitted liability. Stephen Brown J awarded damages including £7,000 for pain, suffering and loss of amenities, interest on that sum, and future earnings limited to the claimant’s one-year life expectancy.

The claimant died while his appeal was pending, and his widow continued the proceedings as administratrix. The Court of Appeal followed Oliver v Ashman [1962] 2 Q.B. 210 and refused damages for earnings during the “lost years”. It increased the general damages to £10,000 but removed the interest award.

Conjoined appeals raised three issues: whether lost-years earnings were recoverable; whether the Court of Appeal was entitled to increase the general damages; and whether inflation justified withholding interest.

1. Disposition. The claimant’s appeal was allowed on lost-years earnings and interest. The employer’s cross-appeal was allowed on general damages. The lost-years issue was decided by a majority of four to one; the other issues were decided unanimously. The assessment of lost-years damages was remitted to the Queen’s Bench Division.
2. Lost-years earnings. Per Lord Wilberforce, Lord Salmon, Lord Edmund-Davies and Lord Scarman, a person’s capacity to earn during a normal working life is a present asset of measurable value. Its destruction or diminution is a pecuniary loss even where the tort also prevents the claimant from surviving throughout the relevant period. The claimant may therefore recover earnings which would probably have been received during the lost years, whether or not the claimant has dependants. Oliver v Ashman [1962] 2 Q.B. 210 and Harris v Brights Asphalt Contractors Ltd [1953] 1 Q.B. 617 were overruled. Benham v Gambling [1941] A.C. 157 was explained as concerning only damages for loss of expectation of life.
3. Assessment. Per the majority, lost-years damages must be assessed justly and with moderation, applying ordinary principles governing future pecuniary loss. The claimant’s probable personal living expenses during the lost years must be deducted because recovery is confined to the surplus which would have remained available to the claimant. The House prescribed no comprehensive calculation rules. Lord Scarman added, obiter, that other measurable financial expectations lost through premature death might also be recoverable if not too remote.
4. Dissent. Lord Russell of Killowen would have dismissed the lost-years appeal. He considered that compensation for benefits accruing only after the claimant’s anticipated death, and the proposed deduction of living expenses, created conceptual and practical difficulties better resolved by legislation.
5. Interest and general damages. Per Lord Wilberforce, Lord Edmund-Davies and Lord Scarman, with the agreement of the House, adjustment for inflation preserves purchasing power, whereas interest compensates for being kept out of money. General inflation was not a special reason for withholding interest under section 22 of the Administration of Justice Act 1969, amending section 3 of the Law Reform (Miscellaneous Provisions) Act 1934. The trial judge’s interest award was restored. His £7,000 assessment for pain, suffering and loss of amenities was also restored because no error of principle or fact, and no wholly erroneous estimate, had been shown.

• House of Lords: In Pickett v British Rail Engineering Ltd [1980] AC 136, also reported as [1978] UKHL 4, the claimant’s appeal was allowed on lost-years earnings and interest, and the employer’s cross-appeal was allowed on general damages. Assessment of lost-years damages was remitted to the Queen’s Bench Division.
• Court of Appeal: The court refused lost-years earnings, increased damages for pain, suffering and loss of amenities from £7,000 to £10,000, increased loss-of-expectation damages from £500 to £750, and removed interest from the general damages.
• Queen’s Bench Division: Stephen Brown J awarded £7,000 for pain, suffering and loss of amenities, interest of £787.50, £1,508.88 for earnings lost during the claimant’s shortened survival, and £500 for loss of expectation of life.