S41 Barry (A Minor) -v- National Maternity Hospital [2016] IESC 41 (13 July 2016)

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Cite as: [2016] IESC 41

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Judgment
Title:
Barry (A Minor) -v- National Maternity Hospital
Neutral Citation:
[2016] IESC 41
Supreme Court Record Number:
307/2011
High Court Record Number:
2007 8367 P
Date of Delivery:
13/07/2016
Court:
Supreme Court
Composition of Court:
Denham C.J., O'Donnell Donal J., Clarke J., MacMenamin J.
Judgment by:
MacMenamin J.
Status:
Approved
Result:
Appeal dismissed
Judgments by
Link to Judgment
Concurring
Clarke J.
Denham C.J., O'Donnell Donal J., MacMenamin J.
MacMenamin J.
Denham C.J., O'Donnell Donal J., Clarke J.



THE SUPREME COURT
[Appeal No. 307/2011]

Denham C.J.
O’Donnell J.
Clarke J.
MacMenamin J.
      BETWEEN:
CHARLOTTE BARRY (A MINOR)

SUING BY HER MOTHER AND NEXT FRIEND

AISLING CAMPBELL

PLAINTIFF/RESPONDENT
AND

THE NATIONAL MATERNITY HOSPITAL

AND PETER LENEHAN

DEFENDANTS/APPELLANTS

Judgment of Mr. Justice Clarke delivered the 13th July, 2016.

1. Introduction

1.1 I should start this judgment by indicating that I am in complete agreement with the judgment of MacMenamin J. both as to the result of this appeal and as to his reasoning in concluding that the appeal should be dismissed.

1.2 On the basis of the evidence which was before the High Court, the arguments presented to that Court and the arguments made on this appeal, I am satisfied that no other result would be appropriate. However, it seems to me that there is, potentially, another and more satisfactory basis on which to approach the question of damages arising out of a need for enhanced accommodation. As that approach was not the subject of any evidence in the High Court and was not really the subject of any argument either before that Court or this Court, the views which follow are necessarily tentatively expressed. I would leave it to a case in which there was appropriate evidence and in which the issue was fully debated, to reach a definitive conclusion. For the reasons already noted this case is clearly not suitable in that regard. I should turn first to the problem which has been identified in the case law fully analysed in the judgment of MacMenamin J.

2. The Problem

2.1 It is important to start by recalling that the issue with which the Court is faced relates to the proper way in which a court should, in the context of accommodation needs, implement the undoubted principle that a plaintiff is entitled to full compensation for all losses suffered as a result of an established wrongdoing on the part of a defendant but is not entitled to be over-compensated. The fundamental principle of almost all damages claims is that a court should attempt to put the plaintiff back into the position, insofar as money can do it, in which the plaintiff concerned would have been had the relevant wrongdoing not occurred. In cases such as this, one of the heads of damage stems from the fact that a plaintiff may, as a result of serious or catastrophic injuries suffered, require adapted accommodation so as to enable them to live a reasonable lifestyle. Given that the problems which give rise to the need for such adapted accommodation stem from the established wrongdoing of the defendant then it is not disputed that the reasonable cost of providing suitably adapted accommodation forms a legitimate part of a relevant claim.

2.2 The problem is as to how it is appropriate at the level of principle to go about measuring that cost. In a very simple case a plaintiff might already own accommodation which can simply be adapted by the expenditure of money. In such a case the measure of damages will be the cost of the adaptation together with any continuing costs associated with maintaining the property in a suitably adapted form. While there may always be a debate about the details of the calculation in such a case that assessment is unlikely to throw up any significant issues of principle.

2.3 A more difficult question emerges in cases where it is necessary to provide new accommodation because the existing accommodation available to the plaintiff (either the plaintiff’s own property, whether owned or rented, or the property of parents or other relatives, again whether owned or rented) may not be capable of suitable adaption. The issue which emerges in such cases has been fully analysed in the case law which has been dealt with by MacMenamin J. in his judgment.

2.4 On the one hand the cost of buying and adapting suitable premises might be seen as an appropriate starting point for a consideration of the correct amount of compensation. Of course, the fact that a cost would have to have been incurred in providing ordinary accommodation in any event would need to be taken into account as a deduction. But it is likely, at least in many cases, that providing compensation on the basis of purchase (even with such a deduction) may give rise to the possibility of a windfall gain for the estate of the relevant plaintiff. This is so because the property concerned will still be owned after it is no longer required as accommodation for the plaintiff in question and its value will, therefore, be available to increase the size of the plaintiff’s estate beyond that which it might have been had the plaintiff not been injured. On that basis it is argued by defendants that the straightforward solution of assessing compensation by reference to the additional costs (above that which would have existed anyway if there had been no injury) of providing accommodation by buying and adapting a suitable premises amounts to over-compensation.

2.5 On the other hand it is said that to require an injured plaintiff to expend some of their own money (whether obtained from their own pre-accident resources, in the case of a plaintiff who happens to have such resources, or by allocating damages awarded under another heading, in other cases), in order to meet some of the additional costs of a purchase of a property suitable for adaptation, might be said to under-compensate the plaintiff concerned. The logic behind that argument is that a plaintiff who has their own resources should not be required to put those resources into the purchase of a property which they would not otherwise have had to have purchased. This is said to be so because so doing would be to place the plaintiff concerned in a less advantageous position than they would have been had they not been injured. Such a course of action can easily be seen to potentially infringe the principle that the plaintiff should be put back, insofar as it may be possible, into the position in which they were prior to being injured.

2.6 Likewise, if the additional resources required to purchase a suitable property come, not from the plaintiff’s own resources, but from other damages awarded in the case in question, then it is equally said that this amounts to an under-compensation of the plaintiff. This is so, it is said, for those other damages, it must be assumed, will be properly calculated to compensate the plaintiff concerned under each other legitimate head of damages. If, for example, damages are awarded for future loss of earnings then those damages are designed to provide an income for the plaintiff broadly commensurate with the income which the plaintiff might have had if they had not suffered catastrophic injuries. Some of that income might, of course, have been used to provide for accommodation in any event. There could be no problem with making an appropriate deduction to reflect that fact. But to require such a plaintiff to divert an additional part of such damages into the purchase of suitable property, required so that they may enjoy appropriately adapted accommodation, can be argued to reduce the damages in question below that which places a plaintiff in the position in which such a plaintiff could be said to be fully compensated for their injuries.

2.7 From the perspective of a defendant the problem can, therefore, be seen as an over-compensation of the plaintiff but likewise, from the perspective of a plaintiff, the same problem can be seen as an under-compensation. It seems to me that there is a strong argument to suggest that the reason for that problem, and thus the reason for the difficulty encountered in much of the case law, is a failure to properly recognise the distinction between the current (in the accountancy sense of that term) cost of accommodation, on the one hand, and the element of the cost of the provision of purchased accommodation which can be said to amount to a capital investment, on the other. It is in recognition of that difficulty that I tentatively put forward the suggestion set out in the next section of this judgment which is to the effect that the principal focus for the award of damages in respect of accommodation needs should, at least in the vast majority of cases, be on the rental cost of suitable accommodation rather than the cost of purchase. For the reasons already noted I would wish to reemphasise that, because this matter was not fully debated, the suggestions made must remain, at this stage, purely tentative.

3. The True Cost of Providing Accommodation

3.1 The first point to make is that there may not necessarily be a “one size fits all” solution to the problem. Different cases may turn up unusual facts or circumstances which require the court to approach the application of the general principle of attempting to put the plaintiff back in the position in which they would have been had there been no wrongdoing in a manner which may not be suitable in other cases and other circumstances. However, it seems to me that the appropriate starting point for a consideration of the calculation of damages in cases involving a requirement to provide new accommodation (because existing accommodation, even with appropriate adaption, would not be suitable) lies in considering the cost of renting the accommodation concerned.

3.2 The backdrop to that observation is the fact that, at least so far as persons who have sufficient resources are concerned, a decision on whether to rent or buy a home is not an essential part of the provision of accommodation. A rented home is every bit as much a home as a purchased home. There may, from the perspective of one individual or another, be all sorts of reasons which may inform a decision as to which means of providing for a home is preferred. Ownership may be perceived to give greater security into the future. Ownership may be seen as providing a means of acquiring an asset which it might be hoped might appreciate in value (although the recent experience in this jurisdiction has, perhaps, dispelled the previously held view that investment in a family home is necessarily one of the best ways of accumulating capital). There may be issues concerning the respective tax treatments of rent or interest incurred on mortgages which may affect the equation. Many other factors, personal or financial, may also be relevant.

3.3 It must also be acknowledged that there will undoubtedly be persons who do not have that choice to make at all. The current market for private rented accommodation in Ireland has placed the renting of suitable accommodation outside the reach of quite a number of persons. Many cannot now rent at all unless they are lucky enough to secure rent supported local authority housing or have available a sufficient level of State support to be able to meet rental payments. Some, who have greater income, can afford to rent but may not be in a position to purchase either because their income might not be considered sufficient to sustain the level of mortgage which would be required to purchase a suitable property or because they do not have sufficient assets to meet the requirement to put up some of the equity themselves. Doubtless other reasons of that type might arise in the particular circumstances of individual cases.

3.4 A person who might not reasonably be expected to ever own their own house will not necessarily always be entitled to compensation which would put them in the position of owning a house. A similar analysis applies, however, in the case of a person for whom the choice of renting and ownership does exist. Such persons may choose to rent but equally may choose to pay whatever additional costs may be required to become the owners of residential property. While the relative cost of renting and purchase as and between themselves may vary over time, dependent on short term movements in matters such as the rental market, prevailing interest rates and the supply and demand for purchased houses or the like, over time it is almost inevitable that there will be some additional cost in purchasing. This will be so because of the fact that a purchaser not only gets to occupy the purchased house (as will be the case in the event of renting) but also gets to acquire a capital interest in owning it. That extra cost may be in the form of having to put up some money in advance (such as a minimum deposit to secure a mortgage) in circumstances where that money could otherwise be invested. The additional cost may also involve any difference between mortgage repayments (which obviously include a capital element) and rental costs. To the extent that a person may have significant independent assets which they can apply to the purchase of a house then the cost may involve the income foregone in not being able to apply those assets in some other beneficial way. Whichever may be the cost, it is, at the level of principle, appropriate to regard the cost of the purchase of a house intended for owner occupation as involving partly the cost of providing accommodation but also partly the additional cost involved in acquiring an asset.

3.5 The second element of that equation is, for those who have sufficient resources to be able to exercise the choice, an elective element. A person may choose to rent. They may choose to allocate additional resources above and beyond that which it would cost to rent so that they may own. But the allocation of those additional resources is a decision which each person who has the resources to make it can determine in the light of their own view of their own best advantage.

3.6 Viewed in that way the true cost of providing for accommodation is the cost that would be required to rent what ever type of accommodation might be considered necessary. Any additional cost involved in purchase is not truly the cost of providing accommodation but rather is the cost of acquiring an asset. It is for that reason that I consider there to be strong arguments in favour of the proposition that at least the starting point for a consideration of the appropriate damages to be awarded in respect of accommodation needs should be based on the cost of renting appropriate premises. However, it is necessary to take into account the fact that there may be further practical issues which will need to be addressed in the circumstances of many cases. Obviously the precise way in which those considerations might impact on an individual case would require a consideration of the evidence in such a case. However, at this stage it may be useful to indicate some of the general considerations which I consider might arise at a practical level. Those considerations are by no means intended to be exhaustive.

4. Some Practical Considerations

4.1 I should, therefore, start by pointing out that these observations are made very much in the abstract. To the extent that issues such as those which I mention may arise in the circumstances of any particular case then it will be necessary to give full weight to any relevant expert evidence called and the arguments addressed by the parties. This section of this judgment is not designed, therefore, to suggest solutions but rather to identify at least some of the issues which may arise.

4.2 The first, and perhaps most important, question which may arise stems from the fact that there is not, as such, a market for specially adapted accommodation. While it is relatively easy to see how a requirement to compensate by reference to an accommodation need can be dealt with on the basis of providing for rent where ordinary accommodation which is readily available is all that is needed, an undoubted complication arises given that the basis for the assessment of compensation in cases such as this stems from the need to provide suitably adapted accommodation.

4.3 However, there is no reason in principle why it should not be possible to obtain long-term rented accommodation with an agreement either that the landlord carry out suitable adaptions and reflect that fact in the rent or that the tenant carry out the adaptions at their own expense with the landlord reflecting in the rent the fact that the premises may, to some extent, need to be reconverted at the end of the tenancy. Precisely how it would, in such circumstances, be appropriate for a court to conduct a rent-based assessment of damages would necessarily depend on the evidence in the case in question.

4.4 Next there is the problem that any assessment based on rent will necessarily involve an actuarial calculation based on the life expectancy of the plaintiff in question. That gives rise to the unfortunate but common problem that the single assessment of damages model which has, heretofore, operated in this jurisdiction can give rise to injustice for either plaintiffs or defendants where the actual life of the plaintiff in question turns out to be either significantly shorter or significantly longer than the life expectancy estimated at the time of the trial. It is now quite some time since a judge-led working group put forward proposals for periodic payments to remedy that potential injustice. The implementation of those proposals has long been promised and it has been intimated that relevant legislative measures will be introduced in early course. However, the solution to the life expectancy issue lies in such legislation and should not present a barrier to an otherwise appropriate rent-based approach to the cost of accommodation.

4.5 It must also be recognised that it is possible that there will be cases where, for one reason or another, a rent-based approach, actuarially calculated, may give rise to a figure which is equal to or even greater than the cost of actually acquiring and adapting appropriate accommodation deducting, where appropriate, for the costs which would have been incurred in providing ordinary accommodation in the first place had there been no injury. In such a case there could, however, be no injustice to a defendant in requiring the cost of acquisition and adaptation (with appropriate deduction) to form the basis of any award for in such a case the plaintiff would be no better off than they would have been had they simply rented and adapted suitable accommodation. It follows that in such cases any residual capital value in the estate of the plaintiff after death simply results from the fact that it is as cheap or cheaper to buy rather than rent in all the circumstances of the case. There can be no injustice in such a situation.

4.6 Finally, there is the question of plaintiffs where it is reasonable to require that any suitably adapted accommodation also provide for other family members who might reasonably be expected to live with the plaintiff concerned. This may be because of age, of the need to provide regular care, or, in cases of catastrophic injury at birth or in early age, because it is appropriate that the plaintiff concerned should, to the greatest extent possible, be able to enjoy a family life as close as can be achieved to that which would have occurred had they not been injured by the negligence of a defendant. There may, of course, in such circumstances be an additional cost involved resulting from the requirement to obtain suitable rented accommodation which could be adapted but which could also accommodate the other family members who might reasonably be expected to reside there. But such an additional cost is an inevitable and foreseeable consequence of wrongdoing which leads to the kind of catastrophic injuries with which the Court is concerned in this case. The provision of such accommodation is necessary to put the plaintiff in the closest possible position to that in which the plaintiff would have been had there been no injury. That means living in the ordinary way with the plaintiff’s family. Indeed if that situation continues for longer than might ordinarily be expected to be the case precisely because of the level of disability from which the plaintiff suffers then that too is a direct and foreseeable consequence of the wrongdoing.

4.7 Importantly it should also be pointed out that the fact that the proper approach to the calculation of damages may use as a starting point a consideration of the actuarial valuation of the additional cost of renting suitably adapted accommodation does not necessarily mean that a relevant plaintiff actually has to live in rented accommodation. Where a catastrophically injured plaintiff is in a position to make their own decisions then they can, like any other person, make a decision as to whether they wish to allocate additional resources (if they have them) to owning as opposed to renting. But the allocation of those additional resources is, in that context, entirely voluntary.

4.8 In like manner, a person who is not in a position to make such decisions for themselves ought be able to rely on those in whom decision-making power is vested to reach a similar decision about whether it is in the best interests of the plaintiff concerned to allocate additional resources to purchase above and beyond that which might be needed to rent. But in such a case the allocation of those additional resources cannot be said to diminish the resources available to the plaintiff concerned (whether in the form of the plaintiff’s own resources or damages awarded under some other heading) because the decision to purchase rather than rent is again voluntary (even if taken by a person acting on behalf and in the interests of the plaintiff).

4.9 For the reasons which I have sought to analyse I am, therefore, of the view that it would at least be appropriate in a subsequent case to consider, provided the necessary evidence had been led and the necessary arguments made, whether a rental based approach is preferable. If it should transpire, on the evidence, that a rental based approach does not significantly diminish the amount which requires to be provided to secure appropriate accommodation below that which would be needed in the event of a purchase of similar accommodation, then it may well be that defendants cannot be said to have any legitimate complaint about having to provide such a sum. If, on the evidence generally or in the circumstances of a particular case, there is a significant saving achieved by adopting a rental based approach then that would be no injustice to the plaintiff concerned for any decision to purchase, using resources above and beyond those required to rent, will be an elective decision made either by the plaintiff (should the plaintiff have appropriate capacity) or by those acting on the plaintiff’s behalf.

4.10 Such an approach seems to me to potentially be more appropriate as a matter of principle reflecting the fact that the true cost of providing accommodation is the cost of renting same rather than purchasing. The approach also has the potential to provide a practical solution to the problems which have bedevilled the assessment of damages in cases such as this which difficulties are fully set out and analysed in the case law referred to and discussed by MacMenamin J. in his judgment.

5. Conclusions

5.1 I reiterate that I fully agree with the judgment of MacMenamin J. as to the proper disposition of the appeal in this case.

5.2 I have given this concurring judgment for the purposes of tentatively suggesting that, in a case in which the issue was fully explored both in evidence and in argument, it may well be more appropriate to at least consider whether a rental rather than a purchase based method of assessment of the costs of providing suitable adapted accommodation may be more appropriate. Obviously a final decision on whether such an approach was appropriate either in general or in the circumstances of any particular case, would have to await proceedings in which the issues touched on in this judgment (and, doubtless others) were fully debated in the light of appropriate expert evidence.
Judgment of Mr. Justice John MacMenamin dated the 13th day of July, 2016

Introduction
1. Charlotte Barry, the plaintiff/respondent in these proceedings, was born in the National Maternity Hospital on the 9th September, 2005. That hospital is the first named defendant, and is now the appellant to this Court. The second named defendant has been struck out of the proceedings. Consequently, the only reference to a “defendant” or “appellant” herein concerns the hospital.

2. As the result of negligence during the course of her labour and delivery, the respondent sustained a severe hypoxic-ischemic insult. She became severely asphyxiated during her birth. She required resuscitation by way of intubation and ventilation. She developed acute hypoxic-ischemic encephalopathy. She now suffers a severe syndrome of Cerebral Palsy (Spastic Quadriplegia), with marked neuro-developmental difficulties.

3. Many of the headings of damage were agreed and settled. They were ruled by the High Court. This appeal concerns one aspect of the principle of compensation. At one level, it is obvious that no financial award would be adequate to put a young girl of 10 years of age, such as Charlotte, back in the situation in life where she should have been, but for the negligence which occurred. The duty of the courts, nonetheless, is to ensure that, without injustice to the appellant, the respondent receives full financial compensation for what has occurred, in order to ensure that she receives the proper degree of care and amenity which her ongoing condition requires.

4. The specific issue which arises in this appeal relates to what are called special accommodation expenses. In the High Court, the judge, (O’Neill J.), awarded €735,000 under this heading. The appellant submits that the judge failed to apply the approach on accommodation expenses said to have been established in the case of Roberts v. Johnstone [1989] QB 878. The nature of this approach, and how it evolved, requires some consideration. It is first necessary to deal with the factual background of the appeal. There is no cross appeal.

The Background
5. Having agreed that the sum of €875,000 was a proper cost of acquisition of a new property, the parties to this appeal have also agreed that a further sum of €283,000 would be the cost of necessary adaptation of the house to meet Charlotte’s needs. The total cost of acquisition and adaptation, therefore, was €1,158,000, or, in round figures, €1.16 million. It was also agreed that the expenditure of the sum of €283,000 would enhance the value of the new home by €135,000. The value of the respondent’s old home at 7 O’Connell Gardens, Sandymount, was agreed in the sum of €550,000. Damages for the respondent’s future loss of earnings were also agreed in the sum of €350,000, on the assumption that she would have commenced earning the sum of €50,000 per annum from the age of 18 years upwards.

6. The question is what approach may a trial court adopt in calculating accommodation expenses into the future? In this case, this subdivides into the following questions:

The High Court Judgment
7. In the High Court, O’Neill J. described the issue before him in this way:
      “In deducting the agreed value of the existing home, the defendants say that if this is not done, in effect, an extraordinary role reversal occurs, in the sense that instead of the plaintiff's parents providing accommodation for the plaintiff, as would be their normal parental obligation until she reached adulthood, the plaintiff would become the provider of accommodation for her parents and any other siblings. In arguing for a deduction of the agreed value of the existing home, the defendants acknowledge that the plaintiff's parents will be entitled to have an interest in the property to be acquired, commensurate with their contribution to its acquisition. The defendants further submit that the agreed enhanced value, namely, €135,000, resulting from the adaptation of the new property, must be deducted as being extra to the additional expense of accommodation resulting from the plaintiff's injuries, in effect, a capital bonus.”
8. The trial judge took the view that the respondent was entitled to compensation for the additional cost of accommodation beyond that which she would, in the ordinary course, herself have incurred in the course of her life, had the capacity to provide her own accommodation not been destroyed by the injuries suffered. In the High Court, the respondent’s case was that the extent of compensation under this heading should be the full €1.16 million. On this proposition, O’Neill J. commented:
      “Insofar as the plaintiff's claim to the entire cost of the acquisition of the new property and its adaptation fails to take into account at all the actual cost of accommodation as distinct from the capital value of the property in which it is provided, and the value of any accommodation provided to the plaintiff by her parents, it fundamentally departs from the ordinary principles for the ascertainment of compensatory damages, and, in my opinion, such a fundamental change to ancient and time-honoured legal principles would require legislative intervention.”
9. The High Court judge took the view that the assessment of compensation for future accommodation needs should exclude an award which might leave intact an appreciating asset in the hands of the respondent at the end of the period for which compensation was calculated. He considered his duty was, rather, to carry out an actuarial calculation as to the capital sum which, if spent at the rate envisaged, would be fully exhausted at the expiry of the period in question. The judge concluded that the respondent was entitled to the entirety of the additional cost of accommodation for the adult portion of her lifespan, but, insofar as the period of her minority was concerned, credit had to go to the appellants for the value of the benefit of accommodation provided by her parents during that period.

10. The parents’ equity in that home was €217,000. Thus, before O’Neill J., the appellant’s position was calculated as follows:

Cost of Acquisition of New House€875,000
Less: Value of 7 O’Connell Gardens550,000
€325,000

      which fell to be multiplied by 3% (the real rate of financial return)

      Giving rise to the sum of €9,750.00


The Parties’ Submissions to the High Court
11. It is helpful to now briefly outline the parties’ submissions to the High Court. This makes clear how the judge approached his task. The appellant contended at the trial that the figure of €9,750.00, (see calculation above), should be multiplied by the respondent’s multiplier, having regard to her age expectation, which multiplier was 20.3. This produced a capital value of €197,925. To this figure should then be added the sum of €283,000 (as cost of adaptation or conversion), which came to €480,925. The appellant contended that this figure should be reduced by €135,000 (that is, the enhanced value of the new house), producing a final figure of €345,925, which it was prepared to round up to €350,000, as being the claimed extent of its liability in respect of the cost of future accommodation for the respondent.

12. Counsel for the respondent criticised this approach. He contended that this would fail adequately to compensate his client for costs of accommodation which would be necessary for her. He submitted that the deduction of the agreed value of the parents’ home forced the parents, effectively, to contribute their only asset to compensate their child, thereby relieving the hospital of a portion of their liability. Counsel submitted that if the parents were compelled to do this, it would be grossly unfair to them, because their only asset would then be irretrievably dedicated to the child’s benefit for the duration of her lifetime, thereby depriving them of the opportunity to use the asset to benefit themselves, or for the benefit of Amelia Barry, Charlotte’s sister, born on the 30th April, 2008, or other children who they intended to have, or possibly to use the value themselves later in life. Counsel submitted that such an approach would act in a particularly unfair way upon the parents, in view of the fact that their mortgage on the existing family home was in excess of €330,000, leaving their equity as only €217,000. The respondent’s case, therefore, was that the appellant’s approach entirely failed to give just compensation for the appellants’ wrongdoing, thereby leaving Charlotte and her parents in the invidious position of either not acquiring a suitable accommodation for her at all, or, if that accommodation was to be acquired, making up the shortfall in purchase price by contributions in the form of dipping into the other heads of damage, or, possibly, by the parents themselves having to contribute the gross (and not net) value of their existing home. The result of this, counsel submitted, would be that the parents would find themselves in the position of actually indemnifying the appellant in respect of their wrongdoing.

13. It will be immediately seen, therefore, that the appellant’s position was that, rather than deducting the value of the parents’ equity in 7 O’Connell Gardens (€217,000), it wished to deduct the full market value of €550,000, which, in turn, was to be deducted from the cost of acquisition of the new house.

14. The respondent’s case, in turn, was that to adopt the approach urged by the appellant would be to arrive at an inadequate method of ascertaining just compensation, which had evolved as a result of a misconceived pre-occupation with avoiding a windfall gain to the family or estate of a plaintiff, as evinced by the method of actuarial calculation chosen. Counsel for the respondent submitted that such an approach was wholly inappropriate in achieving the correct balance of justice, bearing in mind the catastrophic consequences which had befallen, both Charlotte and her parents, in every aspect of their lives, all of which had resulted from the hospital’s wrongdoing.

15. One might comment here that the stance adopted by the appellants in the High Court is an apt illustration of the way in which the Roberts v. Johnstone principle can operate. It is open to the criticism that it is not always an appropriate method for arriving at truly just compensation, and lays too great an emphasis on seeking to avoid a windfall gain to the family or estate of a plaintiff, which may result from the method of actuarial calculation chosen. Counsel for the respondent submitted that this method was inappropriate in achieving a correct balance of justice, bearing in mind the catastrophic consequences, not only for the child herself, but for her parents in every aspect of their lives.

The Trial Judge’s Reasoning
16. The trial judge concluded that the appellant was entitled to a credit commensurate with the value of the benefit to the respondent of having accommodation provided for her during her childhood or minority. The extent of that credit was to be limited. He concluded that the hospital was entitled to a credit commensurate with the value of the benefit to the child of having accommodation provided for her during her childhood or minority. The extent of that credit was to be limited, in order to reflect the value of that benefit and no more. The approach he adopted requires close consideration. He calculated that the extent of the benefit was that Charlotte was currently one of a family of four. She lived in a house worth €550,000, provided by her parents. The parents had both legal and moral obligations with regard to the nature of the occupation of a family home by any individual child, and having regard to the number of adult and child occupants of the house during the child’s minority. The judge, therefore, took the view that the child’s benefit in this regard could not be considered to exceed 1/6th of the value of the house. He considered that the existence of a mortgage on the house was immaterial, because that was an essential ingredient in the way Charlotte’s parents discharged their legal and moral obligations to provide accommodation for their family. What mattered, he considered, was that there was a house worth €550,000 which the family as a whole, and individual members of it, enjoyed to a certain extent. He concluded it would be wholly unjust to ascribe to the respondent the entire value of the property, as if this was for her exclusive benefit. He was satisfied that a just apportionment of the value of the property, to reflect the respondent’s occupation of it during her minority, should be a 1/6th share, for which credit was to be given to the appellant.

17. The judge took the view that the parents’ obligations to provide accommodation would, in all probability, end at the expiration of Charlotte’s minority, or soon afterwards. This corresponded to approximately one-half of her total life expectancy of 35 years. Thus, he concluded, it necessarily followed that, insofar as the appellant sought to have the entire value of the current family home taken into account as representing the value of, or part of the value of, the child’s future accommodation for the duration of her life expectancy, there must be apportionment of that value also. This would reflect the fact that, upon reaching adult status, the respondent, but for her injuries, would no longer have had that accommodation available to her as a right, nor indeed, as a matter of probability, would she have continued to avail of it, having assumed normal adult status. He assumed that, from then on, she would have availed of the normal opportunities of life, including obtaining her own accommodation. Thus, the judge found that an order to reflect the fact that the family home would, but for her injuries, only be available to the respondent for approximately half of her current expected lifespan, the benefit to her of her share in the accommodation should be reduced by one-half. He concluded that the benefit in that regard was equivalent to one-twelfth of the value of the house.

Legal Authorities
18. In the absence of any clear authority on this specific issue in our jurisprudence, the High Court judge is hardly to be blamed for seeking out some legal authorities at least addressing certain principles which would assist him in the difficult task. He referred, therefore, to the decision of Walsh J. in this Court in Doherty v. Bowaters Irish Wallboard Mills Ltd. (Doherty) [1968] I.R. 277 (“Doherty”).

19. Doherty was delivered almost half a century ago. Then, there were different assumptions regarding awards of damages to catastrophically injured persons. The plaintiff in Doherty sustained catastrophic injuries, as a result of which it was necessary for him to obtain accommodation. In the course of his judgment, Walsh J. did enunciate certain dicta therein on the assessment of compensation for future accommodation needs of a disabled person. He appeared to out-rule the possibility that an award of compensation might leave intact any enduring or appreciating asset in the hands of a plaintiff at the end of the period for which compensation was calculated.

20. O’Neill J. decided to apply this dictum. He considered that the appropriate manner for compensating for a future loss, in a case such as this, was by an actuarial process, operating so as to ensure that the capital sum, as spent at the rate envisaged, would be fully exhausted at the end of the period in question.

21. I would comment here, however, that the trial judge appeared to consider himself bound by the judgment of Walsh J. in Doherty, with which O’Dalaigh C.J. agreed. But, in fact, this judgment was in the minority on the damages issue. The majority judgment on the question of damages was that of Lavery J., with whom Haugh J. and O’Keeffe J. agreed. Doherty does not directly address the issue in this appeal. Consequently, the High Court judge was not obliged to follow Walsh J.’s dicta, although these might have appeared to be consistent with the decision of the United Kingdom Court of Appeal in Roberts v. Johnstone [1989] AC 878. Prior to a consideration of the approach to be adopted here, certain general observations may be appropriate about this appeal.

Relevant Factors
22. This is a case which stands on its own facts. Charlotte had to be accommodated in new accommodation. This is not a case where special facilities could be installed in her existing house. It would be possible to compensate a plaintiff who owns a house for any depreciation in value for alterations such as modifying doorways to accommodate a wheelchair, installing lifts, or lowering working surfaces. The installation of such facilities would very likely have the effect of reducing the value of the accommodation. A prospective purchaser might well wish to restore the accommodation to its normal condition, and if so, would reduce the purchase offer to allow for such expenditure. If evidence established that such alterations had actually reduced the capital value of the accommodation by a certain sum, then the special damages would be increased by that amount to compensate for this element of loss. That is a simple case, where a plaintiff does not make a windfall gain and, therefore, there is no objection to an award of full reasonable cost of the facilities.

How the Law Evolved: George v. Pinnock
23. A more difficult problem arises where a plaintiff has bought, or intends to buy, the accommodation needed to meet a disability. The problem is, how to value the cost incurred as against the benefit of having a capital asset in the new accommodation? In George v. Pinnock [1973] 1 WLR 118, Orr L.J., in the Court of Appeal of England and Wales, observed that it would be wrong to award the full capital cost of acquiring a house. He held:

      “An alternative argument advanced was, however, that as a result of the particular needs arising from her injuries, the plaintiff has been involved in greater annual expenses of accommodation than she would have incurred if the accident had not happened. In my judgment, this argument is well founded, and I do not think it makes any difference for this purpose whether the matter is considered in terms of a loss of income from the capital expended on the bungalow, or in terms of annual mortgage interest which would have been payable if capital to buy the bungalow had not been available. The plaintiff is, in my judgment, entitled to be compensated to the extent that this loss of income or notional outlay by way of mortgage interest exceeds what the cost of her accommodation would have been, but for the accident.” (at pp. 124/125)
24. But, as the learned authors of Kemp and Kemp, on the Quantum of Damages, (Volume I, Sweet and Maxwell, London 1992), then pointed out, the practical difficulty with this approach was that, if one applied the appropriate multiplier to the annual expense calculated on either of these bases, the result was often the same as the capital cost of the accommodation. The learned authors pointed out that the court, in fact, had to make some arbitrary deduction from the amount which would have been reached by applying the usual multiplier to the annual expense. The authors wrote:
      “The end result was, in reality, a figure plucked from the air. The court struggled with this problem for years.”

Roberts v. Johnstone
25. In Roberts v. Johnstone [1989] Appeal Case 878, the Court of Appeal sought to combine the approach outlined by Orr L.J. in George’s case, with reasoning previously adopted by Lord Diplock in Wright v. British Railways Board [1983] 2 AC 773. The court regarded the purchase of residential property, as the equivalent of the purchase of an investment secured against the risk of inflation, and so considered 2% an appropriate return on the net extra capital expenditure, rather than the higher net percentage rate, which would be payable by a plaintiff on a mortgage of the property.

26. The effect of this ruling was that damages in respect of the purchase of special accommodation were to be assessed by taking the multiplicand as being 2% of the net capital cost of the accommodation, and then applying it to the multiplier, which would be applied to any other annual expense continuing for the rest of the plaintiff’s life.

27. The authors of Kemp and Kemp gave an illustration by way of one hypothetical example, where a plaintiff was aged 30 years and had a normal expectation of life. The conventional multiplier to apply in such a case to expenses continuing for life would be 16. Thus, hypothetically, the calculation would be:

Sale Price of Previous Property£60,000
Purchase Price of New Property£100,000
Cost of Modifications£10,000

These modifications, in fact, would reduce the value of the new property on the open market to £95,000. The hypothetical plaintiff had incurred wasted capital expenditure of £15,000. This was recoverable in full, as special damages. Such a plaintiff, thereby, would have a capital asset worth £95,000. From this should be subtracted the value of the previous capital asset of £60,000, giving rise to a difference of £35,000. 2% of £35,000 is £700.00, to which should be applied a multiplier of 16. Thus, damages would be:

£700.00 x 16
      = £11,200
Wasted Expenditure
      £15,000
Legal Costs of Sale and Purchase
      £ x
Removal Costs
      £ y
Total Damages under this heading
      £26,200 + £x + £y

28. The approach adopted in Roberts clearly constituted a re-appraisal of the approach previously adopted in George v. Pinnock. The effect of George v. Pinnock was to allow a plaintiff to borrow in order to pay either for the required accommodation, or for adaptation of a house. The aim in Roberts, however, was to avoid an outcome whereby, in the case of a young disabled plaintiff, with a multiplier at the top of the range, the resulting amount would significantly exceed the capital cost upon which it was intended to be interest. In Roberts the chosen multiplier was 16, which, when applied to a mortgage rate of 7%, actually took the figure above the cost of the new accommodation, specifically to 112% of the cost.

29. In Roberts, Stocker L.J., in the Court of Appeal, took the view that the court could not award this amount, as this would not accord with the principles lying behind the reasoning of the court in George v. Pinnock. The Court of Appeal, therefore, adopted a 2% interest rate, which had previously applied in the case of non-pecuniary loss in personal injury cases by the House of Lords in Wright v. British Railways Board [1983] 2 AC 773. However, this rate was the interest applicable to non-pecuniary losses in personal injury claims. It is not easy to discern why there should have been such allowance for interest rates in the first place.

30. The practical result of the adoption of a 2% rate, at a time when multipliers were worked out on a 4.5% discount rate, was that a plaintiff would, at best, obtain by way of damages in the region of one-third of the capital cost of their new accommodation; that is, 30% on a multiplier of 15; and 36% on a multiplier of 18.

31. As an unintended outcome, plaintiffs were forced to resort to monies awarded for general damages for non-pecuniary loss, and, to the extent that they could afford, to allocate part of the award for loss of earning capacity for the remaining funding of the special accommodation needs to which they were actually entitled.

32. O’Neill J. referred to a subsequent English High Court decision of Willett v. North Bedfordshire Health Authority [1993] PIQR, Q166. There, the cost of alterations was regarded as part of the capital cost of the property, and included in the 2% calculations. Hobhouse J. held in that case:

      “In Roberts v. Johnstone a similar item was not included in the capital value allowance of the property. The matter does not appear to have been the subject of argument. I consider there is no escape from the logical and proper approach of treating appropriate capital expenditure, which is incurred after the purchase, which enhances the value of the house, in the same way as expenditure which is incurred in the acquisition of the house itself. Any other approach produces not only mathematically and logically inaccurate results but also an unjust result.” (Q173)

The Trial Judge’s Consideration of the Various Approaches
33. In the instant case, O’Neill J. concluded, as did the Law Commission in the United Kingdom, that the approach adopted by the High Court in Willett to the cost of alterations was preferable to that taken in Roberts. He reasoned the approach was more consistent with the core principle applicable to the acquisition of assets with an enduring capital value as, for example, set out in Roberts v. Johnstone.

34. Adopting this approach, therefore, O’Neill J. identified that portion of the cost of alterations which did not produce any enhancement of value, which is treated as a wasted or wasting asset, and then looked at the balance of the cost of alterations, which produced an enduring capital value which was then treated in exactly the same way as the purchase cost of a new house, for the purposes of calculating compensation to be paid by a wrongdoer. To avoid putting the full enduring capital cost in the hands of the respondent, he decided the compensation should be calculated on an actuarial basis on the assumption of a 3% return on capital, multiplied by the appropriate multiplier in this case, which was 20.3%. The agreed alterations were €283,000, and the enhanced value resulting was €135,000. This meant that of the €283,000, €148,000 was to be seen as a wasted, or wasting, asset. The remaining €135,000 was, therefore, to be considered as an enduring capital asset, and be treated accordingly.

35. The judge then took the figure of €135,000 and treated it in the same way as the purchase cost of a new house, for the purpose of calculating compensation. Thus, he took a return on capital of €135,000 as being €4,050, and multiplied that sum by the appropriate multiplier, which was 20.3. Taking these two figures together, then, he added the sum of €82,250, together with €148,000, giving rise to a figure of €230,215 as the cost of alterations.

36. Accordingly, the calculation of the figure of the cost of accommodation was as follows:

          Purchase Price of House
          €875,000
          -
          €45,833 (1/12th of €550,000)
          =
          €829,167
          x 3%
          =
          €24,875.01
          x 20.3
          €504,962.70
          Plus: Cost of Alterations
          €230,215.00
          Giving Rise to a grand total of:
          €735,177.70
37. In engaging in this process, the trial judge adopted what can only be called a modified Roberts v. Johnstone approach. I do not say this in a spirit of criticism, but rather merely to point out the difficulties which a trial judge can face in seeking to do justice in circumstances where one approach, which may achieve justice, fails to achieve a just outcome in another case.

Is There One Exclusive Method?
38. In fact, there is no, one, exclusive method of assessment appropriate to every circumstance in a situation of this kind. However, there is always one proper criterion by which the adequacy of a particular method may be judged. It is, whether or not the result of the assessment fairly makes good the financial loss incurred. By adopting this principle, the law establishes a proper measure of compensation for pecuniary loss. The actual process of assessment can only then be a matter for reasoned estimation and computation. Kemp and Kemp refer to observations by Stephen J., and Australian judge, albeit in a minority judgment, in Todorovic v. Waller,
37 ALR 481:

      “Rules and practices develop in the process of assessment, and no doubt tend, by their judicial adoption in a legal system governed by precedent, to become current orthodoxy. But since the medium of compensation is money, whose purchasing power and income yielding qualities may change over time, a particular process of assessment, attuned to a particular state of the medium, may come to be no longer appropriate. It follows that, since the sole function of the process of assessment is to attain what the law has fixed as the proper measure of compensation, there can be no place in the process for fixed rules of law; instead the process must be capable of adjustment in the face of changes in the quality of the medium of compensation. The current acceptability at any time of a process of assessment will depend, and depend only, upon whether or not its outcome fairly corresponds to what the law has set as a proper measure of compensation”.

How This Appeal Evolved
39. I turn now to the evolution of this appeal. When the matter first came before the Court, one might have inferred that this was to be a test case. A true test case, properly so called, is one where a court is asked to pronounce the law on a question of legal principle. The outcome will have a decisive bearing on the result of a range of cases, sometimes of exceptional public importance. Quintessentially, the issues will be well defined. The potential outcomes may significantly differ, dependent on the decision of an appeal court. The effect or principle of the decision is to have a precedential effect.

40. But, as matters turned out, this is hardly the position here. The task of the Court has been reduced in scope, as a result of the way in which the stances of both the parties have developed. Indeed, as will be seen, on one view, the actual difference between the positions adopted by the appellant and respondent, have now faded into relative insignificance.

The Issue Before This Court
41. What is before the Court is one, single, case. The respondent is content with the High Court award. The question, then, is whether the appellant can persuade this Court that the High Court judge erred in a way that it significantly altered the outcome of the case before him, and created an injustice to either party? As we will see, one might cavil with the manner in which the High Court judge arrived at the result. But, this is not the point. The question is, rather, whether this Court should interfere with the High Court judgment? Arising from the various issues canvassed in this appeal, one is alert to many possible pitfalls. What is less easy is to arrive at any principle of general application on this issue, where, plainly, the Roberts approach has imperfections and can create injustice. Moreover, the task is made more difficult where no, one, alternative, principled approach is put up which can achieve a just balance between plaintiffs and defendants, on a universal basis.

42. What follows, therefore, is a brief survey of case law, which follows the modest aspiration of seeking to illustrate some of the approaches adopted in the neighbouring jurisdiction. This judgment cannot enunciate some general principle of application, therefore. Ultimately, the question must come down to this, was the High Court judgment so wrong in its approach or outcome that this Court should interfere with the award?

43. As indicated, the judge awarded €735,000 under the accommodation expenses heading. It is only fair to point out that the appellant has indemnified the respondent in relation to all or any costs from the appeal, and also indicated that she will not suffer from any deduction resulting from the outcome of this appeal.

How the Parties’ Differences Narrowed
44. The extent to which the issues have further narrowed can be aptly illustrated in this way. In the High Court, the appellant took the view that the sum of €350,000 would amount to adequate compensation under the accommodation heading. The respondent, by contrast, asserted the sum required was €1.16 million. These remained the positions when the matter first came before this Court on appeal. Coincidentally, perhaps, the trial judge’s award of €735,000 fell just short of a mid-point between those two extreme polar figures. But, as matters further developed in written submissions, and as the issues were further refined in argument, the appellant’s position was, ultimately, that an award of €692,000 would not have been unjust, dependent upon the manner in which the decision in Roberts v. Johnstone was applied. What lay between the parties, ultimately, therefore, was the High Court award of €735,000, and the appellant’s final position, asserting that justice might have been done with an award of €692,000.

45. As an appendix to this judgment, there is a spreadsheet, prepared by the appellants. This sets out the manner in which a number of different calculations were (or should have been) arrived at.

46. Viewed from the left column, Option 1, “Plaintiff’s Case”, deals with the plaintiff/respondent’s calculations, but with no actuarial calculation whatsoever. This leads to the figure of €1,158,000. Option 2 is the plaintiff’s case calculated on an actuarial basis, which gives rise to an award of €763,090. The third column from the left is the trial judge’s judgment, which is calculated on an actuarial basis, but where there is a deduction of €45,133.00, being 1/12th of the total value of the house of €550,000. The fourth column sets out the appellant’s case, if predicated on a full deduction of €550,000, i.e. the full value of the family home, without making any deduction for the mortgage, or the respondent’s attributed share therein. This gave rise to a total figure (A + B + C) of €428,140. The fifth column from the left takes into account two apparent miscalculations, that is, a failure to take into account the increase in value as a result of adaptations, either on an actual, or an actuarialised, basis. This gave rise to a figure, which was that advanced in the High Court, of €345,925. To the extreme right, is the appellants’ ultimate position, correctly making an attribution for increasing value of the adaptations, and thereafter subjecting the same to an actuarial process. On that basis, the appellant’s total figure comes to €692,446, which, as can be seen, is not far from O’Neill J.’s ultimate figure.

47. Obviously, there are, what might best be described as “improvised”, elements in O’Neill J.’s approach. The fundamental question is whether justice was done? To an extent, the question now answers itself. In my view, whatever the methodology, the outcome was correct.

The English Authorities Referred to On Appeal
48. It would not be doing justice to the case advanced by the appellant without adverting to the range of authorities which were brought to our attention. These are largely decisions of courts of first instance in England and Wales. But, they are nonetheless of interest for reasons of explanation in the conclusion section of this judgment.

49. Wells v. Wells [1999] 1 AC 345 is the exception. There, the Court of Appeal allowed for a discount rate reduced from 4.5% to 3%. The position of the plaintiff there was also altered by the use, in place of the 2% rate of interest for non-pecuniary loss of the discount rate, a revised 3%, as previously adopted by the House of Lords in Thomas v. Brighton Health Authority [1999] 1 AC. I refer hereafter to the plaintiff or ‘claimant’ interchangeably. In Wells, the House of Lords overturned the Court of Appeal’s 2%, and restored the 3% attributed by the trial judge, who had been prepared to derive the multiplier from a new discount rate.

50. I turn then to the illustrative judgments by Courts of First Instance. In the High Court judgment of Oxborrow v. West Sussex Hospitals NHS Trust [2012] EWHC 1010 QB, the claimant was so catastrophically injured at birth that he was expected only to live to the age of 21 years. Accommodation would be required only for a comparatively short time, starting from the date of trial. This led to a small multiplier of around 13, which, when applied to the 2.5% discount rate, provided the plaintiff with a little over 30% of the value of the property envisaged. In Oxborrow, there was, under the U.K. Rules of Court, an application for an interim payment on account of damages, to provide suitable accommodation for the plaintiff. His counsel argued that Roberts should not apply, and there should be adopted a solution to the effect that the plaintiff be given the full purchase price, but with a charge on the purchased property in favour of the defendant, which would be realisable on the claimant’s death. I make no comment on this suggestion, other than to say this is an approach which appears to have found favour in other judgments (see Clarke J.’s concerning judgment). It can, however, give rise to a concern on the part of indemnifiers regarding a potential liability in the future, in circumstances which cannot be foreseen.

51. Both M (A Child) v. Leeds Health Authority [2002] PIQR Q46, and Iqbal v. Whipps [2007] LS Medical 97 show nuanced approaches to Roberts v. Johnstone. In the former, Sullivan J., then a High Court judge, had to deal with a situation where the plaintiff, her brother and her parents lived in a detached house before the negligence occurred, but thereafter had moved into a bungalow, purchased and adapted to meet the plaintiff’s needs. The defendants sought to deduct, during the period, for which the claimant was expected to share the house with her family (up to the age of 25 years), the value to the claimant’s parents of having a house provided free of charge for the whole family. On this, the judge commented:

      “I come back to the basic proposition, which is that this is a compensation claim made on behalf of M. It is intended to compensate her for the effects of her disability. While she, for the purposes of this calculation, notionally lives at home with her parents until the age of 25, it seems to me that she is in no different position from any child who could not reasonably be expected to go out into the market place and buy accommodation.”
52. A further deduction was sought in respect of the value of the property which, if the plaintiff had not been injured, she would have been likely to have purchased herself when she left home. The judge accepted that such a deduction was appropriate from the time when the claimant could have been expected to leave the family home and acquire her own accommodation.

53. In Iqbal, (cited earlier), the claimant/plaintiff and his parents had been living in rented accommodation. That rent was paid by means of housing benefit, since the claimant’s father was unfit to work. The family moved into a suitably adapted bungalow purchased from the claimant’s damages. The defendant contended that allowance should be made for notional rent payable by the claimant’s parents, and equivalent to the amount previously paid by way of housing benefit. It was contended that the claimant’s parents would still be entitled to housing benefits, if he entered into a tenancy agreement with the claimant’s representative. There was, it was said, no reason why the claimant’s parents should not pay rent to the plaintiff, as they had previously paid it to their previous landlord. The defendant’s counsel relied on Roberts v. Johnstone, and the deduction that had been made in that case to reflect the value of the previous family home. He submitted that there was no reason why this should not also apply to a case where the family’s previous property had been rented. But, Bell J., the High Court judge, held that the defendant’s argument failed for practical reasons, in the particular circumstances of the case. The plaintiff’s parents were not actually paying rent. The arrangement suggested by the defendant’s counsel would be cumbersome, and would merely result in money being transferred from one public body to another. The claim was brought by the claimant himself so that the deduction of notional rent could be justified only by finding that the failure by the plaintiff (through his receiver, or the U.K. Court of Protection), to demand rent from his parents constituted an unreasonable failure to take steps to mitigate his loss. It could not be characterised as such.

54. Bell J. commented:

      “More generally, it is not just to deprive parents of the incidental benefit of living rent free, when there are so many sacrifices on their part, most obviously the detriment to their quality of life, which must go uncompensated under our laws of tort, however high the award in their child's favour.”
55. In Whiten v. St. George’s Healthcare NHS Trust [2011] EWJHC 2066 (QB), counsel for the defendant suggested that the claimant should give credit, as against the capital value of the new property for the value of the property that, had he not been injured, his parents would have owned and the family would have lived in. Swift J. identified the problem which arose in M and Iqbal as being that the claim was brought on behalf of the claimant and not his parents. She considered it wrong, in principle, for the value of a property that would have been owned by the claimant’s parents to be deducted from the value of the new property to be owned by him. To make such a deduction would also be unfair to the claimant. It would inevitably result in him being inadequately compensated for the loss of investment income on the capital value of the new property. The judge pointed out that it was not the claimant who had been relieved of the expense of purchasing a home, it was his parents. Yet the loss would fall on him.

56. The judge commented:

      “I recognise that, in Roberts v. Johnstone, a deduction was made for the value of the claimant's parents' home. However, as I have already said, it appears that the claimant's advisers in that case had invited the court to make the deduction, so that the issue was not argued before the lower court or the Court of Appeal. The fact that neither court queried the concession made by the claimant does not necessarily imply that they "approved" it.”
57. She went on to consider the possibility of the parents paying rent for occupying the accommodation, and for the sum paid by way of rent to be deducted from the claim for his annual loss of investment income on the capital value of the new property. She pointed out, however, that, in some cases, this would not be possible, because parents would lack the financial resources to pay rent. There would, moreover, be a risk that the parents’ ability to pay rent might change over time. In that event, a plaintiff would end up out of pocket, if, at trial, a deduction had been made from the annual claim for investment income on the capital value of his new property, in order to take account of rent which was not, in fact, paid.

58. In Whiten, the court rejected a suggestion that the parents should pay rent. It was to be a matter for discussion between the plaintiff’s parents, plaintiff’s deputy, and possibly the Court of Protection. As had been pointed out in Iqbal, if there was no agreement that rent should be paid, the only way that a court could make a deduction of the notional amount of the rent from the claimant’s damages, was to characterise the failure on the part of the claimant to demand rent, as a failure to mitigate his loss. The ordinary principles of mitigation of loss would require the defendant to prove the failure by establishing that the claimant had unreasonably failed to take certain mitigating steps. The plaintiff’s parents indicated that, because of the severity of their child’s cognitive disabilities, they would intend that he should live with them for the rest of his life. The judge pointed out that this was a considerable commitment on their part. It was true that there would be paid carers. Nevertheless, the child would always function at the level of a young child, and his parents would remain, ultimately, responsible for him. His condition would mean that he would require a considerable amount of emotional and other support from them. His disabilities would, inevitably, restrict the range of choices open to them in the future. If they were to take holidays, their destination and mode of travel would have to be suitable for their child. If they wanted to undertake leisure activities as a family, those activities would have to be tailored to meet his requirements. Once they are in the new property, it would be difficult or impossible for them to move again, because of the substantial costs of adapting another property for the claimant. The judge observed (at para. 468):

      “In these and many other ways, their quality of life in the future will be adversely affected. Having regard to those factors, I do not consider that a failure on the part of the claimant (or those acting on his behalf) to demand that his parents pay rent to him can properly be regarded as "unreasonable"”
59. Swift J. continued, at para. 469:
      “The factors I have described above will be present, to a greater or a lesser extent, in the vast majority (if not all) cases involving children with severe disabilities, where the family has to move to alternative, disability-related accommodation. The context and circumstances of those cases will not, in my view, be appropriate for a finding of a failure to mitigate loss to be made. The view expressed by the judge in Iqbal - to the effect that it is not just to deprive parents of the incidental benefit of living rent free having regard to the uncompensated effects of the defendant's negligence on them - can perhaps be regarded as another way of expressing the same conclusion.”
60. For those reasons, the judge rejected the defendant’s contention that a deduction should be made from the annual sum, calculated pursuant to Roberts v. Johnstone, up to the time when the claimant might have expected, had she not been injured, to have acquired a property of her own. Much the same approach appear to have been adopted in later cases (see Ellison v. University Hospitals of Morecambe Bay NHS Foundation Trust, The High Court, Neutral Citation [2015] EWHC 366 (QB); Warbyj; Robshaw v. United Lincolnshire Hospitals NHS Trust, Neutral Citation No. 2015 EWHC 923 (QB)).

Conclusion
61. I have referred to these, clear and comprehensive judgments from the neighbouring jurisdiction for two reasons. First, because they indicate the degree to which judges at all levels have sought to adopt a practical and flexible approach in order to do justice. Second, for the reason that the judicial observations are generally to the effect that, in the event of there being an injustice, the courts have frequently taken the view that a degree of injustice should fall more against a defendant, rather than against a plaintiff. The judgments show the degree to which the calculation of damages in catastrophic injury cases can become a highly technical issue.

62. Judges in appeal courts necessarily operate in a somewhat different environment from courts of first instance. On appeal, the focus is upon identification as to whether there has been an error in principle. But, appeal courts do not, of course, lose sight of the fact that it is the parents who, on a day by day basis, will have to take care of their child, who, through no fault of theirs, sustained injuries.

63. It seems apposite, in this context, to repeat a further observation by Stephen J. in Todorovic, cited earlier, which accurately summarises the choices a court must make. He said:

      “While there may be no one exclusive method of assessment appropriate to every circumstance, there is but one criterion by which the adequacy of any particular method may be judged; it is whether or not the result of the assessment fairly makes good the financial loss incurred.”
He continued:
      “The law, by insisting upon this principle, has established the proper measure of compensation for pecuniary loss; the actual process of assessment can then only be a matter for reasoned estimation and computation.”
64. In this appeal, we are asked to conclude that the trial judge fell into error. I do not deny that the approach he adopted was perhaps unorthodox. It may not have fully accorded with a Roberts v. Johnstone approach. Yet, it is impossible to conclude that any injustice was done. There has been no cross-appeal. The outcome is little different from one of the calculations which the appellant has put forward.

65. In conclusion, I would reiterate, this judgment does not, and cannot, create any new paradigm for calculation of damages in these cases, still less does it create any further burden on indemnifiers. The Court is simply faced now with arriving at a just adjudication on one single case. To my mind, although the approach was unusual, the outcome achieved proper compensation without injustice to either party. I would not, therefore, interfere with the learned High Court judge’s decision. I would affirm that decision and dismiss this appeal.


APPENDIX
Plaintiff’s CaseO’Neill J.’s JudgmentDefendant’s CaseDefendant’s Case
Option 1Option 2Option 3Option 4Miscalculated
No ActuarialActuarialActuarialActuarialActuarialActuarial
€0€0€45,833€550,000€550,000€116,000
DeductionDeductionDeductionDeductionDeductionDeduction
New Home 875,000875,000875,000875,000875,000875,000
Deduction045,833550,000550,000116,000
875,000875,000829,167325,000325,000759,000
3.00%26,25024,8759,7509,75022,770
20.3875,000532,875504,963197,925A197,925462,231
Adaptations - Increasing Value135,000135,000135,000135,0000135,000
3.00%4,0504,0504,0504,050
20.3135,00082,21582,21582,215B082,215
Adaptations - Wasting148,000148,000148,000148,000C148,000148,000
Total1,158,000763,090735,178428,140A+B+C345,925692,446












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