The Court of Appeal has today given the long awaited decision in this case reviewing - and departing from - the Roberts v Johnstone basis for calculation of damages for purchase of disability friendly property.
In summary, the Court of Appeal:
- found it was not bound by Roberts v Johnstone since in that case the Court of Appeal's decision was not one of legal principle but the application of authoritative guidance to the then existing circumstances, which have now changed, so that Rv J no longer achieves fair and reasonable compensation for injured claimants;
- going forward, these damages are to be calculated by awarding the additional capital cost of the new property (P-B) less the present market value of the reversionary interest in that property (R);
- R is to be calculated by using an annual rate of return of 5% over the claimant’s life expectancy applied to that difference (P-B), applying the formula R = (P – B) x 1.05(-L)
[Apologies that the font options will not allow raising so here (-L) indicates "to the power -L"]
Damages to be awarded, D = (P-B)-R
On the facts of Swift, this produces the following computation of the value of the claim:
Value of property to be purchased, P = £2.35m
Value of property owned anyway, B = £1.45m
Life expectancy (Table 2), L = 45.43 years
R = (£2.35m-1.435m)*1.05(-45.43) = £98,087
Damages, D = (£2.35m-1.435m)-£98,087= £801,913.
#damages #robertsvjohnstone #accommodationclaims #personalinjury #clinicalnegligence #seriousinjury
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