Ongoing care

There's more to determining responsibility for paying for ongoing care than avoiding double cost recovery. Jackie Linehan reports

Who should pay for a claimant's ongoing care needs following an injury, the tortfeasor or the state? This would seem to be an easy question to answer: surely the tortfeasor? But perhaps not?

Local authorities and primary care trusts (PCTs) have an obligation to meet the care and/or accommodation needs of those who cannot meet their own needs, often for financial reasons. As a result of the litigation process being protracted, many injured people will call upon their local authority and PCT for social and nursing support to meet ongoing needs. Should a tortfeasor be entitled to argue that the state should continue to meet those needs and as a consequence the damages to be paid are reduced?

One must consider the defendant's motivation. Is it purely to reduce the damages they will pay, or is it to avoid the risk of double recovery by a claimant? That is, to avoid the claimant receiving damages to pay for care privately, but continuing to rely upon the state to meet their needs. This issue is one close to the hearts of tortfeasors in the NHS or local authority who would wish to avoid paying for care twice, once in damages and then again their under statutory obligation.

Avoiding double cost recovery?

The first in a series of cases to consider this issue was Sowden v Lodge [2004] EWCA Civ 1370. In this case, the court found that the needs of a severely disabled claimant were best met by state-funded residential accommodation. As such, the damages to be paid by the tortfeasor were substantially reduced, there being no need to compensate for 24-hour care at home.

Subsequently, developing this approach, it was argued on behalf of the defendant in Freeman v Lockett [2006] EWHC 102 that damages for continuing care needs should be reduced to take account of the availability to the claimant of continued state funding. The judge found against the defendant on the basis that the claimant should be free to move around the country or abroad, without the worry or concern that her care needs would not be state-funded elsewhere.

In direct contrast, although differentiated by virtue of the fact that the claimant was not independently able to manage his own affairs, faced with similar arguments in Crofton v NHSLA [2006] Lloyd's Rep Med 168, the judge found that a claimant who could not manage his own affairs and whose condition would remain unchanged would continue to receive state-funded care and, as such, the amount of compensation for care should be reduced to take this into account.

Achieving settlement

Those dealing with these cases on a daily basis have taken heed of these two judgments and a solution has been achieved by way of a compromise. Settlement is achieved in terms of pay back and indemnity clauses. The claimant receives full damages but undertakes:

a) to continue to seek state-funded care by way of direct payments (instead of the actual care provision); and

b) to repay to the compensator the annual amount received from the state.

With this solution, the claimant avoids the risk of a shortfall in care needs if state funding is reduced or withdrawn and the compensator avoids double recovery.

While Crofton goes to appeal in December 2006 let me leave you with two scenarios to illustrate the difficulty of finding a solution to meet this problem which is fair to all and which covers the multitude of different circumstances which arise:

Scenario 1

A quadriplegic person is in receipt of state-funded care and accommodation, those costs being met in equal shares by his local authority and PCT. The financial value of this support equates to a figure in excess of £1m for life. He suffers an additional injury as a consequence of negligent medical treatment, which leads to increased and more specialist care needs. The value of these additional needs for life is £500,000. However, on receipt of damages at that level, he will lose his entitlement to the pre-existing state-funded care and accommodation. There is a possible solution, which is the use of a personal injury trust, but by placing his damages into a trust he loses the ability to spend the money on what he chooses (the prerogative of all claimants who have capacity to manage their own affairs). This makes this option unattractive.

Should the tortfeasor be responsible for paying the £1m to meet pre-existing care needs as well as £500,000 damages for the increased care need, thereby trebling liability?

Scenario 2

A patient is rendered hemiplegic and unable to manage her own affairs as a result of negligent medical treatment. Pending settlement of her claim, she arranges for her local authority and PCT to meet her care needs. These are met by direct payments of £200 per week, which are used to fund independent carers. On receipt of damages she remains entitled to claim £200 per week as her damages are lodged with the Court of Protection and are ignored for means-tested benefits.

Should the claimant be entitled to claim damages from the compensator, her local NHS Trust, to meet her care needs in full and still claim the £200 per week from the local authority and PCT towards her ongoing care because she remains entitled to do so?

No doubt the answer will become clearer as the current string of case law develops. In the meantime, local authorities and PCTs should not regard their liability as ending when damages are paid and may choose in the future to be joined into the proceedings as an interested party. In many recent cases, they will continue to face applications to make direct payments or other provision for the claimant's lifetime.