New Law To End Lump Sum Payouts

Author:Ms Rebecca Ryan
Profession:Matheson
 
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The Government recently approved the creation of new law which will provide an alternative to large, once off awards in cases involving catastrophic injuries. The move is expected to improve the provision of lifelong care and medical treatment for catastrophically injured people.

Under the current system, successful plaintiffs who are awarded damages by the court are awarded lump sums based on estimates of their life expectancy, which can leave a shortfall. The proposed legislation however, awards damages in phased payments over an individual's lifetime.

Significant development

The new law will be contained within the Civil Liability (Amendment) Bill. News of this change was welcomed by the president of the High Court, Mr Justice Nicholas Kearns, who said it was a "very significant development".

Background

Court awards are made up of two parts, general damages and special damages. General damages are made up of awards for pain and suffering, both past and into the future. Special damages are awarded for the financial loss suffered and expense incurred by a person as a result of another's wrongdoing. These include care costs and loss of earnings, both past and into the future. Currently, we have a cap on general damages in this jurisdiction, however, by their very nature, there can be no cap on special damages.

The decision to implement new law on Periodic Payment Orders (PPOs) follows a number of significant multi-million euro awards and settlements, despite there being a ceiling on general damages of €450,000.

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