Periodic Payments for catastrophic injuries *

Cosgrove Gaynard Solicitors

Pressure is continually increasing for the introduction of legislation to provide for periodic payments in claims involving catastrophic injuries. A working group was set up in 2010 to review this area of law and it reported unanimously in 2010 that legislation was required to allow cases to be settled by way of periodic payments for such catastrophic injuries.

Pressure is continually increasing for the introduction of legislation to provide for periodic payments in claims involving  catastrophic injuries*. A working group was set up in 2010 to review this area of law and it reported unanimously in 2010 that legislation was required to allow cases to be settled by way of periodic payments for such catastrophic injuries.

Pending this reform, it is clear from the latest catastrophic injuries claims that have come before the High Court recently that the courts are anticipating the introduction of legislation for periodic payments.  The court has awarded lump sum interim payments with cases being adjourned for 18 months / 2 years to allow for this legislation to be introduced.

Currently, compensation is made by way of a lump sum which includes all future and past losses.  This lump sum is increasingly hard to determine and in some cases can result in an injustice as one is taking a risk regarding the cost of future care, life expectancy of the plaintiff, returns on investments etc. The issue is that this lump sum payment may not be sufficient to cover the overall care requirements of the plaintiff especially if life expectancy is underestimated. Likewise if life expectancy is overestimated, this could result in the plaintiffs family inheriting a large lump sum. By comparison, if periodic payments were introduced these risks would be minimised.

A critical issue in introducing periodic payments is the provision of an appropriate index to guard against inflation costs for future care.  In the UK for example, the Courts have measured inflation costs for future care against inflation in carers wages as opposed to a consumer price index.

Minister Shatter has confirmed that the drafting of the Civil Liability (Amendment) Bill will commence shortly to deal with this area. Cosgrove Gaynard Solicitors will keep you informed or any updates regarding this proposed legislation.

* In contentious business, a solicitor may not calculate fees or other charges as a percentage or proportion of any award or settlement. This statement is made in compliance with Reg.8 of SI 518 of 2002.

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