Brown v Ministry of Defence

Damages for future loss must reflect assessed chances, rather than treating a result that is more probable than not as certain. A fair career model may be used to assess future earnings, with ordinary promotion and career risks reflected through the multiplicand or multiplier.

Where an unusual event, such as completing a qualifying service period that produces an immediate pension, materially changes the value of the loss, that chance must be assessed separately. A staged calculation may be used where a year-by-year model would be unnecessarily complex. Future labour-market disadvantage may be awarded where medical evidence establishes a more than insignificant risk of forced career change and consequent disadvantage.

The claimant was injured during basic Army training and later discharged. Liability was admitted, but the parties disputed the value of her financial losses, including pension rights, future labour-market disadvantage and loss of congenial employment.

District Judge James assessed damages on the basis that she would have completed 22 years’ service, reached Staff Sergeant and had a 30% chance of promotion to WO1. The Deputy Circuit Judge upheld the 22-year pension assessment, removed the labour-market award and rejected the WO1 assessment. The Ministry appealed on pension loss. The claimant cross-appealed on promotion and labour-market disadvantage. The central issues were how future career and pension contingencies should be assessed and whether the evidence supported an award for future labour-market disadvantage.

Moore-Bick LJ, giving judgment for the court, allowed the appeal and cross-appeal to the extent indicated.

1. The assessment of damages for events which would have occurred but for the injury is governed by the chances principle. The court must evaluate the likelihood of different outcomes, rather than decide the matter by applying the balance of probabilities as though the more probable outcome were certain. This principle was stated in Mallet v McMonagle [1970] A.C. 166 and Davies v Taylor [1974] A.C. 207.
2. For future earnings, the court should adopt a fair career model reflecting the claimant’s earning capability. Ordinary chances of promotion or career change may be reflected by adjustments to the multiplicand or multiplier. A separate assessment is required only for an unusual event likely to produce a significant change in earning capability. Doyle v Wallace [1998] P.I.Q.R. Q146 and Langford v Hebran [2001] EWCA Civ 361, [2001] P.I.Q.R. Q160, were examples of that approach. Herring v Ministry of Defence [2003] EWCA Civ 528, [2004] 1 All E.R. 44 was not inconsistent with it.
3. Pension loss required separate treatment. Completion of 22 years’ service would have produced an immediate pension rather than a pension payable at age 60. That unusual and financially significant consequence required a separate assessment of the chance of completing the qualifying term.
4. The court adopted a staged calculation. It valued the normal pension at six years’ service at 100%, the additional value at 12 years at 50%, and the further additional value at 22 years, including the accelerated pension, at 30%. Staff Sergeant was assumed after 14 years and six months. The possibility of WO1 promotion was assessed at 15%, reflected by an uplift equal to 15% of the additional pension value.
5. The claimant’s future labour-market award was restored because the medical evidence showed a more than insignificant risk that osteoarthritis would force her from active physiotherapy into more sedentary employment. The appropriate award was £5,000, representing approximately four months’ earnings, rather than the £18,383 awarded below. The £10,000 award for loss of congenial employment was left undisturbed. The parties were permitted to calculate the resulting pension award and make further representations on the form of order.

• Court of Appeal (Civil Division): [2006] EWCA Civ 546. The Ministry’s appeal and the claimant’s cross-appeal were allowed to the extent indicated, with pension loss and labour-market disadvantage reassessed.
• Lancaster County Court: The Deputy Circuit Judge upheld an award based on 22 years’ service and Staff Sergeant rank, set aside the labour-market award and rejected the 30% WO1 assessment.
• Carlisle County Court: District Judge James assessed damages on the basis of 22 years’ service, Staff Sergeant rank and a 30% chance of promotion to WO1. Awards included pension loss, labour-market disadvantage and loss of congenial employment.