Wright v Barts Health NHS Trust

A settlement with one concurrent tortfeasor does not ordinarily release another tortfeasor whose separate negligence contributed to the same damage. The court must construe the settlement agreement in its factual context. Release will occur only where the agreement clearly shows that intention or the payment clearly satisfies the whole claim. A settlement discounted for contributory negligence or litigation risk will not necessarily represent full compensation. The claimant must give appropriate credit for sums recovered, so the rule against double recovery remains effective.

The claimant suffered catastrophic spinal injuries in a workplace accident and brought an action against the defendant hospital alleging that negligent treatment worsened his condition. Before proceedings against the hospital were issued, he settled a claim against the contractor responsible for the workplace accident for £400,000 plus costs. The settlement included a substantial discount for contributory negligence and did not reserve the claimant’s right to sue the hospital.

The defendant applied to strike out the claim under CPR 3.4 or for summary judgment under CPR 24, arguing that the settlement had compensated the claimant in full, extinguished the loss, or made the proceedings an abuse of process. The central issue was whether the settlement released the hospital or otherwise provided a complete defence.

1. The applications were dismissed. The settlement did not fully compensate the claimant for the loss allegedly caused by the hospital, and it did not release the hospital from liability.
2. The contractor and the hospital were concurrent tortfeasors. They committed separate tortious acts contributing to the same damage, but their liabilities were not identical. The contractor was liable for losses caused by the accident, including some losses occurring after the clinical negligence which would have occurred in any event. The hospital was liable only for the additional loss caused by the alleged negligent treatment, although it could be liable for all of that additional loss.
3. Following Heaton v AXA Equity and Law Life Assurance Society plc [2002] 2 AC 329, the primary focus in a compromise case was the construction of the settlement agreement in its factual context. The rule that release of one joint tortfeasor releases all does not apply to concurrent tortfeasors.
4. The settlement included a substantial discount. It therefore could not be construed as payment of the full loss claimed against the hospital. The absence of an express reservation of the right to sue the hospital was of little significance because no reservation was needed for a claim which remained legally available.
5. The reasoning in Jameson v CEGB [2000] 1 AC 455 was understood through Heaton. The settlement rule was directed against double recovery, but that risk was met here by giving credit, as appropriate, for the sum already received.
6. The court agreed with Appleby v Northern Devon Healthcare NHS Trust [2012] EWHC 4356 (QB) that the relevant question was whether the compromise represented the full measure of the claimant’s estimated loss. Any further attempt to advance the argument would require an amendment to the defence and supporting evidence, and would face substantial difficulties of lateness and merit.