Herring v Ministry of Defence

Future earnings are normally assessed by selecting a career model that provides a realistic baseline and applying the multiplier and multiplicand method. A percentage assessment for loss of a chance is appropriate where a particular career course would produce significantly higher earnings than the reasonable baseline. It is unnecessary where alternative employment would probably provide similar remuneration.

An Ogden multiplier accounts only for mortality. Any further reduction for contingencies must reflect the claimant’s individual prospects. A substantially increased reduction requires tangible reasons beyond speculation. Adverse possibilities must be weighed alongside prospects of advancement and other favourable vicissitudes.

The claimant suffered serious spinal and other injuries in a parachuting accident. The Ministry of Defence was liable in damages. His Honour Judge Masterman assessed his future earnings by treating a police career culminating in promotion to sergeant as the appropriate career model. He reduced the Ogden multiplier by 25% for uncertainty and contingencies.

The claimant appealed against that reduction. He also challenged the assessment of his residual earning capacity and the absence of an award for loss arising after the assumed police retirement age of 55. The Ministry of Defence initially sought a further reduction in the pension award through a respondent’s notice.

The principal issue was whether the police career should be valued as a percentage loss of a chance or used as the baseline for the conventional multiplier and multiplicand calculation, with an appropriate discount for contingencies.

1. Appeal allowed unanimously. Lord Justice Potter delivered the leading judgment. Lord Justice Tuckey and Mr Justice Wall agreed. The award was increased by £59,300.

2. A court assessing long-term loss of earning capacity must form a view of the claimant’s most likely uninjured working career. The selected career model supplies a baseline for probable earnings. For a young claimant who has not established a career, the court may consider previous performance, intentions, ambitions, available opportunities and steps already taken towards a chosen path.

3. A specific occupation may properly provide the baseline even though entry into or continued employment in that occupation is uncertain. The possibility that the claimant would follow another path is immaterial where alternative employment would probably provide similar remuneration. The percentage loss-of-a-chance method associated with Allied Maple Group v Simmons & Simmons [1995] 1 WLR 1602 is more appropriate where a particular course would generate significantly greater earnings than the otherwise reasonable baseline. Doyle v Wallace (1998) PIQR Q 146 and Langford v Hebran [2001] EWCA Civ 361 illustrated that exceptional situation.

4. The judge therefore properly used the police career as the conventional baseline. He erred, however, by reducing the multiplier by 25%. The Ogden multiplier allowed only for mortality. Guidance accompanying the tables indicated that ordinary contingencies such as illness and unemployment usually warranted a much smaller reduction. A substantially larger discount required tangible reasons concerning the claimant’s personality or probable circumstances, rather than speculative possibilities.

5. The risks of injury, disenchantment and family pressures did not justify the reduction made. The claimant’s ability to secure comparable earnings outside the police also reduced the significance of those risks. A discount of no more than 10% was appropriate. The multiplier was increased from 11.7 to 14, adding £54,300 to the future earnings award.

6. The judge’s assessment of residual earning capacity before age 55 was upheld. However, the real risk that disability would disadvantage the claimant in the labour market after that age justified a further £5,000 award on Smith v Manchester principles. The £50,000 pension award remained unchanged.

1. Court of Appeal (Civil Division): The appeal was allowed unanimously. The damages award was increased by £59,300, comprising £54,300 additional future earnings loss and £5,000 for post-retirement disadvantage.

2. Cardiff District Registry: His Honour Judge Masterman, sitting as a Deputy High Court Judge, assessed the damages payable by the Ministry of Defence. He used a police career as the claimant’s uninjured career model but reduced the applicable multiplier by 25% for uncertainty and contingencies.