Calculating damages in personal injury claims

by Guest injury law blogger on September 26, 2012

Personal Injury claim lawyers sometimes have a bad name. They are viewed as blood-sucking ambulance, chasers, living off the misery of others. This view is compounded by the seemingly exorbitant amounts awarded by the courts in personal injury cases. Every time we see someone awarded £20,000 for a back injury or £5,000 for a whiplash injury, we instinctively recoil. Is such an injury really worth that much? However, the media rarely report the full story. Often the bottom line award is comprised of payments for several different things and may even contain interest.

The amounts of compensation the court awards are not, contrary to what the media may imply, simply plucked out of thin air by the judge. Instead, a book called the ‘Judicial Studies Board Guidelines for the Assessment of General Damages in Personal Injury Cases’ is consulted, normally by both parties’ lawyers. This book is produced by the Judicial Studies Board, the body responsible for training the judiciary in England and Wales. The book aims to standardise the amount of compensation awarded across similar cases and was introduced because, in the words of Lord Donaldson of Lymington: “One of the commonest tasks of a judge is also the most difficult… [the] assessment of general damages for pain, suffering and the loss of the amenities of life.”

Lord Donaldson’s words hint at why the task is so difficult, and why the task is so hard: how do you place a monetary value on the loss of a beloved hobby or on the mental anguish which arise from worry, stress and grief? To give some examples: A young girl, aged 16 is injured in a car crash. She suffers a serious head injury and her father his killed. The head injury causes lasting problems. Her dreams of qualifying as a dentist are dashed. She has lost everything good that her potential career may have brought her, and lost her father. How does the court compensate her for this? An elderly gentleman suffers a wrenching back injury at work and can no longer play golf or work tend to his garden. His retirement plans are scotched. How does the court compensate him?

These are situations the courts regularly have to, and indeed have, dealt with. In such cases, it is not only the physical injury that is compensated, but the loss of the intangible ingredients of a happy life– a fulfilling career, the love of a parent, the indulgence of a pastime and the grief brought on by the realisation of these losses.

Not only are mental anguish and the loss of a chance compensated, but interest is awarded, and computations made based on the future. Detailed actuarial tables, known as Ogden Tables are used to calculate the depreciation in value of compensation over several years.

So, the next time you read about an exorbitant award being made and scoff, remember that it isn’t only the broken leg or the fractured skull that is being compensated. It’s the loss of a chance of a happy life, the loss of enjoyment of a hobby and perhaps even the loss of earnings as is the case in some cases.

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