Thompstone v Tameside & Glossop Acute Services NHS Trust

When assessing periodical payments for future care, the court must seek to preserve the real value of the payments throughout the claimant’s life and to achieve full compensation. Section 2(9) of the Damages Act 1996 permits substitution of an appropriate alternative to the retail prices index, including an earnings-related measure. The claimant bears an evidential, rather than a legal, burden to show that the RPI is unsuitable and that an alternative is more appropriate. The court may compare competing measures and need not require the claimant to elect one alternative in advance. Affordability and wider distributive justice are matters for Parliament, not the court, when determining compensation for future pecuniary loss. On the evidence, the 75th percentile of ASHE occupational group 6115 was an appropriate index for future care costs.

The claimant, a child with severe cerebral palsy caused by negligent management of his birth, brought a claim in which liability and causation were admitted. Most heads of loss had been agreed. The outstanding issues concerned the valuation of past care and whether future care should be paid by lump sum or periodical payments.

The central dispute was whether periodical payments for future care should be indexed by the RPI under section 2(8) of the Damages Act 1996, or whether the effect of that provision should be modified under section 2(9) by using an earnings-related measure. The court also considered whether wider NHS financial consequences could affect that decision.

1. Statutory approach. The court was bound by Flora v Wakom (Heathrow) Ltd [2006] EWCA Civ 1103. Section 2(9) was not confined to exceptional cases and could permit replacement of RPI indexation by another measure. The question was what was fair, reasonable and appropriate in the circumstances, having regard to the purpose of retaining the real value of the payments.
2. The claimant did not bear a legal burden to prove one particular index on the balance of probabilities. He bore an evidential burden to show that RPI was inappropriate and that at least one alternative could provide a more reliable indicator. The court could examine and compare several alternatives.
3. The evidence established that carers’ earnings had historically increased materially faster than the RPI. RPI indexation would therefore probably cause under-compensation and fail to meet the claimant’s needs. The AEI and ASHE median were rejected as insufficiently sensitive to carers’ earnings and capable of producing significant over-compensation.
4. ASHE occupational group 6115 was sufficiently sensitive to developments in the care market and was a reasonable and accurate indicator of the earnings of the relevant carers. The weighted average hourly rate was a fair basis for selecting the relevant percentile. The 75th percentile was preferred because it was close to that rate and produced a simpler and more workable mechanism, particularly upon reclassification.
5. Arguments based on NHS affordability, distributive justice, possible investment gains, or alleged over-compensation under other heads could not justify departing from full compensation. Such resource-allocation questions were matters for Parliament. The small non-earnings-related element of the agreed care multiplicands did not make the proposed indexation unfair.
6. The court ordered periodical payments for future care indexed by reference to the 75th percentile of ASHE occupational group 6115, or any equivalent or comparable replacement occupational group. It was unnecessary to determine the alternative lifetime multiplier for a lump-sum award.

First-instance judgment. No prior appellate history is stated in the judgment.