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Legal case

Swift v Carpenter Court of Appeal - An Update

The Court of Appeal has made it clear that this will be the test case that reviews the approach in Roberts v Johnstone.

The facts

The claimant sustained serious injuries leading to a below knee amputation of the left leg in a road traffic accident in 2013. She was awarded damages in excess of £4 million but, significantly, received nothing for the capital costs of accommodation. Mrs Justice Lambert concluded that she was bound by Roberts v Johnstone which resulted in a nil award. The claimant was given permission to appeal to the Court of Appeal.

First instance decision

The claimant submitted that the traditional Roberts v Johnstone approach was unfair as it produced no loss due to a negative discount rate.

Alternative approaches were canvassed by the claimant including a Roberts v Johnstone calculation using a 2% rate of investment return which was the claimant’s preference; the full capital cost of an interest-only mortgage for life; an interest-only mortgage for life funded by a PPO and the increased cost of renting special accommodation.

Mrs Justice Lambert rejected the claimant’s arguments, finding that she was bound by Roberts v Johnstone which prevented an award being made for the additional capital cost of special accommodation. Permission to appeal to the Court of Appeal was granted.

Court of Appeal

At the invitation of the Court of Appeal, the claimant applied to adjourn her appeal in order for the court to receive expert evidence. She had not sought to adduce expert evidence at first instance.

The Court of Appeal has made it clear that this will be the test case that reviews the approach in Roberts v Johnstone.

The appeal hearing will now take place over four days beginning on 24 March 2020. Uniquely, the Court of Appeal will hear evidence from a number of experts instructed by the parties, namely: -

  1. An independent financial adviser (“IFA”) or mortgage expert.
  2. A chartered surveyor/valuer.
  3. An economist.
  4. An actuary.

The experts will give evidence on the following issues:

  1. Indexation of borrowing costs.
  2. The impact of inflation on the issues arising in the appeal.
  3. Investment returns and discount rates.
  4. Mortgage rates, products and the cost of borrowing for the purchase of a property.
  5. The valuation of a potential reversionary interest in any property purchased by the appellant.

The Personal Injuries Bar Association (“PIBA”) have been given permission to intervene in the appeal.

Lord Justice Irwin continues to be responsible for case management of the appeal.

Update

There was a pre-trial review on 6 February 2020 where there were a number of applications before the court:

  • The appellant application for a Protective Costs Order was refused. Given its significance the Master of the Rolls heard the application together with Irwin and Nicola Davies LJJ. The judgment in the case is of some importance and will be subject to a separate legal update.
  • PIBA were given permission to rely upon their own expert in the valuation of reversionary interests. This was on the basis that the respondent was also given permission to rely upon their own expert evidence in this area.
  • The appellant was given permission to rely upon the evidence of both a valuer and an IFA.
  • The expert evidence (reports, questions and joint statements) are to be completed by 6 March 2020.
  • The parties, at the invitation of the Court of Appeal, are considering whether any alternatives to Roberts –v- Johnstone, can be discounted.

The Appeal Hearing

This will take place over four days beginning on 24 March 2020. It is anticipated that the hearing will be live streamed.

The Court of Appeal will hear oral evidence from the various experts. Subject to the agreement of the Master of the Rolls, the Court of Appeal are attracted to the idea of experts giving evidence concurrently (hot tubbing). This is a relatively new concept in civil litigation and it will be interesting to see how it works in practice.

We anticipate there might be some delay between the appeal hearing and the Court of Appeal handing down judgment.

Weightmans continue to act on behalf of the respondent in this important appeal. Counsel are William Audland QC and Richard Viney both of 12 Kings Bench Walk.

If you have any questions or would like to know more about our legal update, please contact Dave Cottam, Partner, on 0116 2428924 or email dave.cottam@weightmans.com.

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