Jameson and Another v. Central Electricity Generating Board and Others

The House of Lords considered whether a settlement entered into by an injured plaintiff with one of several concurrent tortfeasors extinguishes the plaintiff's separate cause of action against other concurrent tortfeasors and, if so, from what date. The court treated the question as one of construction of the settlement: if the agreement objectively manifests an intention that the sum accepted is in full satisfaction of the tortious claim, that agreement fixes the amount of the claim in the same way as a judgment and thereby extinguishes the cause of action against other concurrent tortfeasors.

The court held that where a settlement is expressed to be "in full and final settlement and satisfaction" of the causes of action pleaded, it will normally operate to discharge the claim against other concurrent tortfeasors from the date of the agreement, subject to an implied resolutive condition if the payment due under the settlement is not in fact made. Applying these principles to Fatal Accidents Act 1976 claims (section 1(1) and section 4 as substituted), the House of Lords held that the deceased’s settlement with his employer extinguished his cause of action against the Central Electricity Generating Board as at the date of the agreement and so the executors could not maintain a claim under the Fatal Accidents Act.

This case concerned executors pursuing a Fatal Accidents Act 1976 claim for dependency after the deceased had, before his death, settled his personal injury claim against his employer for a sum expressly described as being "in full and final settlement and satisfaction". The deceased had sued only his employer (Babcock) in his lifetime, agreed to accept £80,000 plus costs in settlement, and died shortly before the balance was paid. The executors then sued the Central Electricity Generating Board for damages for dependency, alleging concurrent tortious exposure to asbestos.

The principal issues before the House of Lords were:

• whether a settlement with one of several concurrent tortfeasors that is expressed to be in full and final satisfaction extinguishes the plaintiff’s separate cause of action against other concurrent tortfeasors; and
• whether, if the settlement agreement was made but payment was completed only after the deceased’s death, the extinguishing effect operates from the date of agreement or is suspended until payment.

The court analysed the distinction between joint and concurrent torts, emphasised that a damages claim is unliquidated until fixed by judgment or agreement and that an agreement which objectively fixes the amount as full satisfaction substitutes a liquidated contractual obligation for the original claim. The court concluded that where the terms and context show the parties intended full satisfaction, the settlement extinguishes the cause of action as against other concurrent tortfeasors. The court further held that the extinguishing effect operates from the date of the agreement, subject to an implied resolutive condition that if the payment is not performed the discharge is void ab initio. Applying these rules, the settlement in this case discharged the deceased's cause of action as at the date of the agreement, so the Fatal Accidents Act claim failed because, at the moment of death, the deceased would not have been able to maintain an action against the defendant. The court therefore allowed the appeal.

Appeal allowed. The House of Lords held that a settlement made by the deceased with one concurrent tortfeasor, expressed to be in full and final settlement and satisfaction of the causes of action pleaded, objectively fixed the amount of the claim and extinguished the deceased's cause of action as against other concurrent tortfeasors from the date of the agreement. The effect was subject to an implied resolutive condition if payment under the settlement was not performed; because the settlement was implemented, the Fatal Accidents Act claim could not be maintained.

At first instance Sir Haydn Tudor Evans (Queen's Bench Division) decided preliminary issues on 31 March 1995 in favour of the executors. The Court of Appeal (Nourse, Auld L.J. and Sir Patrick Russell) dismissed appeals on 13 February 1997 (reported at [1998] Q.B. 323). The defendant appealed to the House of Lords, which allowed the appeal on 16 December 1998 ([1998] UKHL 51).