In this blog, David White considers Scales v Motor Insurers’ Bureau [2020] EWHC 1747 (QB).
This is an important judgment in that it is (as far as the writer is aware, at least) the first reported decision of one of the senior courts of England and Wales (High Court or above) regarding the application of the Baremo. The Baremo is the tariff for assessment of damages in Spanish RTA cases.
Background
The case arose from a road traffic accident in Spain in 2015. The Claimant cyclist, then aged 69, was hit by a motorist who was driving on the wrong side of the road. The culpable motorist was uninsured hence the compensator was the Spanish equivalent of the MIB, and the English MIB was the appropriate defendant in the English proceedings, meeting the judgment that otherwise would have been met by the Spanish Guarantee Fund. The Claimant was seriously injured, spent several weeks in a coma, and suffered traumatic brain injury, facial fractures, sight and hearing problems, loss of dentition and a serious tibial fracture.
The assessment of the Claimant’s damages is fact-specific but there are wider points of general importance to practitioners that provide useful guidance for other cases where the assessment of damages is governed by Spanish Law.
The case was tried by videolink by Mr Justice Cavanagh sitting in the Birmingham District Registry of the High Court. The Spanish law experts in the case were David Sanchez Almagro for the Claimant and Mr Carreras for the Defendant.
It was agreed that Spanish law applied to the assessment of damages. The accident occurred prior to January 2016 hence the “old” Baremo tariff of 2007 applied, rather than the current version (which applies to accidents on or after 1st January 2016). When compared to assessment of damages in England and Wales, neither Baremo tariff is generous, but the 2007 Baremo is significantly less generous than the current (2016) Baremo.
General Approach
In terms of overall approach to the assessment, Mr Justice Cavanagh held that the starting point for the Court’s assessment of damages was that the English Court should assess Mr Scales’s damages “in the same way that a Spanish Court would do so”, such that the award should approximate to the sum that a Spanish Court would have awarded Mr Scales had he litigated his case in Spain. That being said, were the assessment to have proceeded in Spain, a Spanish Court would be assisted by a Forensic Medical Examiner who would provide guidance to the Court on the key concept of “date of consolidation”, whether the Claimant was a gran invalido and how many points should be awarded for the Claimant’s various injuries. Absent the assistance of such an Examiner, the Court proceeded to resolve disputed issues regarding application of the Baremo having regard to the expert opinion of the Spanish law experts and its own interpretation of the extensive medical evidence.
Restitutio in Integrum
The Claimant argued that there was a tension between the Baremo and the Spanish Civil Code, in that whereas Articles 1902 and 1106 of the Spanish Civil Code prioritise the principle of restitutio in integrum (full indemnity for damage suffered), the 2007 Baremo does not provide this, since the 2007 Baremo does not provide for recovery of post-consolidation “hospital, pharmaceutical and medical expenses” and other expenses pre-and post-consolidation that do not come within that definition. The Claimant invited the Court to remedy this perceived unfairness by allowing new heads of loss that were not provided for by the Baremo. The Court declined such an approach and held that it could not depart from the provisions of the Baremo in this respect.
Consolidation
There was disagreement between the parties as to the “date of consolidation” and the fixing of this date is fundamental for assessment of non-pecuniary and pecuniary losses in Spanish cases. To quote the judgment, this is “the date when the injuries reach a point of plateau/stabilization, after which the victim’s injuries cannot improve significantly with medical treatment and medical discharge is given”. Put simply, in most cases, the later the date of consolidation, the more valuable the claim. The Court noted the artificiality of fixing a given day on which the injuries plateaued, but fixed it on a date that was supported by the Claimant’s expert neuropsychologist as the date by which the Claimant had made the majority of his recovery from the organically-mediated aspects of his traumatic brain injury.
Impeded Days
Claimants are awarded a daily sum for each day in Hospital, and a lower daily sum for post-Hospital “impeded days”. There was dispute as to where the cut-off was between impeded and non-impeded days having regard to the definitions in the Baremo, and the Court assessed all post-Hospital pre- Consolidation days as meeting the definition of being “impeded”.
“Gran Invalido”
Another key battleground was whether the Claimant satisfied the definition of being a “gran invalido” or not. This was of great significance as, unless he satisfied the test, the Claimant would not be able to recover certain heads of loss. The Court adopted a restrictive interpretation and held that his injuries were not of sufficient severity to satisfy the test, hence he could not recover damages for gratuitous care provided by his wife, the costs of past or future adaptations to his home, or adaptation of his own vehicle.
Flexibility
Whilst the Court felt constrained by the strictness of the Baremo in certain respects, the Court found that it had greater scope for interpretation/flexibility in other areas, most significantly in assessing the head of compensation for “Permanent injuries resulting in victim’s inability to carry out his or her usual occupation or activity”. The Claimant was retired, and, as discussed, was found not to be a “gran invalid” but nevertheless the Court awarded the maximum sum permissible for this head of loss (191,151.88 Euros), on the basis that in fixing the appropriate figure the assessing Judge was entitled to take account of the fact that the Claimant had suffered and would suffer financial losses that were not otherwise catered for by the Baremo. In the Court’s own words “the judge has a very broad discretion to “bump up” the compensation under this head in an appropriate case”.
Interest
The final point of importance was calculation of interest. In Spanish Law, the Insurance Contract Act of 8 October 1980 provides for punitive rates of interest where an insurer has not settled a claim within 2 years of notification unless there was a “justified delay” for the non-payment. The evidence was that the Spanish Courts interpret this exception in a very restrictive manner, legitimate exceptions being, for example, where there was some reason to doubt that the claim was covered by the relevant insurance policy, or an issue as to whether the insured had paid the premiums. It was held that it would be very rare for a dispute regarding liability or quantum to engage the escape clause. The fact that the English CPR has its own system for encouraging resolution of disputes (CPR Part 36), that the Defendant was the English MIB and that there was no Court-appointed Forensic Medical Examiner were held not to be good reasons in the Court’s view to deprive the Claimant of entitlement to punitive interest. This determination had a significant impact on the assessment of damages, adding approximately 180,000 Euros to the judgment sum, giving a total award of £539,096.
Comment
By way of summary, this is a very important and interesting case in terms of seeing how an English Court applies the Baremo to assessment of damages in a Spanish RTA case. The case concerned the 2007 Baremo but similar issues arise in respect of the (more generous) 2016 Baremo. However, practitioners still await a decision on the relevance of the Baremo to assessment of loss in Spanish non-RTA cases.
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