Partner Iona Smith discusses accommodation awards in personal injury claims.
If, as a result of an injury your current home is unsuitable for your needs, it would be logical to assume that the full cost of a new home would automatically be recovered as part of your compensation package. The courts are still struggling to find a fair and logical formula to ensure enough money is available in awards of damages to cover the true cost of purchasing an appropriate property, without the injured party being overcompensated, as a consequence of gaining an appreciating asset.
The method by which claims of this nature have been calculated for nearly 50 years has meant that injured claimants have needed to “borrow” money from other elements of their compensation, to ensure they can buy suitable accommodation. Accordingly money awarded for essential items such as care and loss of earnings has had to be put towards the cost of purchasing a suitable property; leaving claimants in a situation where they do not have enough compensation left to meet their future needs.
In 2017 when the Lord Chancellor reduced the personal injury discount rate that was to be applied to future losses, the result was that claimants were effectively in a position where they were receiving absolutely nothing at all for their accommodation needs, bringing an already unsatisfactory situation to a head.
It was clear that the law in this area had to be challenged, and an appeal in the recent case of Swift v Carpenter represented a victory for claimants. The case was brought by a lady who was very seriously injured in a road traffic accident and received £4 million in compensation. She was told by the judge at first instance that she could not recover any of the £900,000 she needed to buy an adapted property. The Court of Appeal overturned the judge’s decision recently, and awarded £800,000 towards the cost of the property.
The insurance industry have already reacted by putting in an appeal to The Supreme Court, who will now have to consider this vexed and complicated issue further. Until this further Appeal has been heard, and judgement pronounced, the law in this area remains uncertain. Here at Gaby Hardwicke we are specialists at identifying and recovering all compensation to which you are entitled in your personal injury compensation award.