In Chouza v Martin & Ors [2021] EWHC 1669 (QB), Martin Spencer J considered a number of interesting issues arising out of a fatal road traffic accident. John-Paul Swoboda of 12 King’s Bench Walk represented the Claimant.
Although there was no foreign applicable law in this case, the judgment depended heavily on expert foreign law evidence to assist with quantification of the claim according to English law principles. It is a reminder that the need for foreign law evidence is not necessarily restricted to “standard” cross-border claims: it may also be vital in proving the quantum of losses recoverable in English law claims by the estate and the dependants.
In this blog post, Richard Ive, a pupil at 12 King’s Bench Walk, considers the interplay between English law quantification and the relevant foreign law. Although this blog post focuses only on the “international” aspects of this judgment, it is worth noting that the case also contains many additional interesting points concerning the nature of dependency and other issues in fatal accident claims, which make it worth reading in full.
Background
The case arose out of a fatal accident which occurred near Burton-on-Trent. The deceased was a Spanish national who lived in Spain but who was visiting England at the time of the accident.
The deceased’s widow brought a claim for damages on behalf of the estate under the Law Reform (Miscellaneous Provisions) Act 1934 and on behalf of the dependants under the Fatal Accidents Act 1976. Liability was conceded and the only issue was quantum.
Practice point: obtaining disclosure documents from overseas bodies
The Defendant heavily criticised the Claimant for making inadequate disclosure of the deceased’s bank statements, tax returns, Spanish Social Security records, and medical records. It was even said that there had been a “campaign of deliberate concealment”.
The Claimant’s response was that they had encountered real problems in obtaining these documents from the relevant Spanish bodies.
He said that he and his mother were told by the bank manager that the deceased’s bank account had been closed and the bank was unable to help. He and his mother also had a face-to-face appointment with the relevant Spanish public body responsible for tax returns and they were told it would not be possible to provide his father’s confidential information. In relation to the Social Security records, they were told that these could not be provided as the deceased had been de-registered due to his death and there was no way to get hold of the records. Finally, they spoke with the family doctor and were only provided with the brief Health Report dated 17 October 2017 from Dr Cesar Garcia.
The judge ultimately accepted the Claimant’s evidence of these difficulties and found that the onus had been on the Defendant to make any applications for further disclosure at an earlier stage if they had considered it necessary.
However, it should not be assumed that all judges will do this. It may be necessary to get assistance from a lawyer based in the foreign jurisdiction or at the very least to ensure that there is some kind of paper-trail evidencing the efforts made to obtain the relevant documents:
It may well be that further, additional efforts could have been made to secure relevant further documentation. For example, the claimant’s solicitors could have engaged a lawyer in Spain to assist in obtaining disclosure from the authorities, rather than leave David and his mother to their own devices. Mr James submitted, reasonably, that if it were true that David and his mother were being told by the various authorities that they could not assist, he would have expected there to have been some kind of documentary confirmation of this.
Income dependency with a Spanish twist
The deceased had set up a construction business in Spain. The company’s main assets were its vehicles and construction equipment. Prior to his death, the business had become insolvent. However, the company had not been wound up.
This was because the company held a transport licence which (under Spanish law) could only be transferred to buyers of the vehicles if it had been held for at least 10 years. Transferring the vehicles with the licence would significantly increase the value which they could realise.
The deceased’s plan had been to wait until the 10 years had expired before winding up the company so that he could use the increased value of the licensed vehicles to pay off the company’s debts.
This was an issue in respect of which the Claimant had to obtain expert foreign law evidence. The expert evidence proved crucial since it provided an explanation for the deceased’s plan with respect to the winding up of the company. There was extensive discussion by the judge about the evidence provided by the Claimant’s expert (Ana Romero) and how it interacted with his assessment of the deceased’s intentions but for the death.
Although there was a dispute about whether or not the deceased would have waited to wind up the company until the vehicles could be sold with the benefit of the transport licence, the judge thought that there was no doubt on the evidence about the deceased that this is what he would have done had he lived. This conclusion meant that the losses associated with the failed company would be significantly reduced.
The deceased had also been working for some years as an operator of construction plant and as a lorry driver for a separate company in Spain. The judge was satisfied on the evidence that he would have kept working for this company until retirement, which he considered would have occurred at the age of 67.
Martin Spencer J had to consider whether the deceased’s pension contributions when working would have entitled him to the maximum Spanish state pension or whether, as contended by the Defendants, the fairest approach was to assume that the deceased would have drawn the average Spanish pension.
To assess pension entitlement under Spanish law, it was necessary to apply a formula set out in Articles 209 and 210 of the Spanish General Law of Social Security. Again, the Claimant had to obtain expert foreign law evidence on this. Without this evidence, it is difficult to see how the judge could have addressed this issue. Because of this evidence, the judge was able to conclude that the deceased would “comfortably” have exceeded the sum necessary to qualify for the maximum Spanish state pension.
An additional claim to avoid increased liabilities and Spanish tax?
Martin Spencer J was asked to decide whether the costs of obtaining a court resolution in Spain to ensure the award was not subject to taxation in Spain were recoverable in law. There was also a related claim for certain increased liabilities by the deceased’s estate on the basis that he died intestate and was unable to wind up the construction business.
The Claimant relied on the case of Davies v Whiteways Cyder Co Ltd [1975] QB 262. In that case, the deceased had made various dispositions in favour of his wife which, had he survived for 7 years, would have been tax-free. However the effect of the premature death of the deceased in that case was that the sum of £6,654 in estate duty had to be paid. This sum was allowed as a future pecuniary benefit of which the claimant was deprived as a result of the death of her husband.
Martin Spencer J, emphasising that this was after all an English law claim subject to the strict provisions of the Fatal Accidents Act 1976, was unconvinced:
Here, the increased liabilities and the costs of obtaining a court resolution in Spain do not represent the loss of any kind of future financial benefit but are purely and simply losses arising as a result of death. If these are recoverable, then so would funeral expenses be without the need for them to be specifically provided for in the Law Reform Act 1934 and in the Fatal Accidents Act 1976. The specific provision for funeral expenses shows that such losses are not otherwise recoverable and in my judgment this aspect of the claim must fail.
Deceased’s life expectancy
For the purpose of calculation of the multipliers, the Claimant used statistics produced by the Spanish Institute of Statistics and introduced into the evidence by the Spanish law expert to produce a specific life expectancy figure for the deceased.
The Claimant submitted on this basis that it was wrong for the Defendant to argue that the standard Ogden Tables for earnings to retirement ages 65 and 68 (Tables 9 and 11) could be used to identify a multiplier: the Spanish statistics took into account mortality and therefore using these Tables would take the mortality risk into account twice.
The judge agreed with the Claimant’s argument: he considered that the Spanish statistics must have incorporated mortality risks for the general Spanish population. On this basis, he applied the Ogden Table 36 term certain multiplier – although he adjusted how this was split across different periods to more accurately incorporate the increased risk of mortality towards the end of the deceased’s life.
This is a useful illustration of the way in which foreign life expectancy statistics can be used to provide a “bespoke” life expectancy in fatal accident claims. Such statistics will arguably produce more accurate estimates in cases where the deceased was based abroad. That evidence was in this case properly introduced by the Spanish law expert. However, where this is done, the decision shows that it is important to avoid the risk of double counting of mortality risks when using the Ogden Tables to calculate losses.