Interim payments for accommodation claims

The case of AC (a minor suing by his father and litigation friend MC) v St Georges Healthcare NHS Trust before Mrs Justice Whipple on 15 December 2015 should give claimant lawyers renewed determination to advise their clients where appropriate to apply for interim funding to purchase suitable accommodation.

Since the court set out the approach to adopt when considering applications for interim payments in Eeles v Cobham Hire Services Limited  there have been many reported failed attempts by claimants seeking interim payments to enable  them to buy accommodation and probably many more where claimants have been advised that an application would probably not succeed. The result has undoubtedly left many claimants having to “make do” in wholly unsuitably accommodation through no fault of their own.

The justification for the conservative approach adopted in Eeles is twofold.  The first is avoid the risk of fettering the discretion of the trial judge in deciding whether to award periodical payments and for which heads of loss in cases where it was possible that such an award would be made.   Further, defendants argue that releasing significant sums of money to enable the claimant to purchase and adapt accommodation or set up a care regime creates what is described as an “uneven playing field” and this should be avoided.

Eeles provides for a two staged approach to interim payments, with the underlying premise that under CPR 25.7 that the court can only award interim payments which will be no more than a reasonable proportion of the likely amount of the final judgment.  Whilst that proportion can be high, the court must undertake a conservative assessment.

The first stage (Eeles 1) is for the court to assess the heads of loss which are certain to be awarded as a capital sum.  In general terms the heads will be general damages, past losses to trial, accommodation costs (including future running costs) and interest.  When considering an interim payment based on these losses, the court does not need to trouble itself with the likely use of the funds, save for bearing in mind as a factor any argument in relation to creating an uneven playing field.

If the assessment in this first stage provides less than the interim payment sought, the court will move to the second stage (known as Eeles 2) and consider if there are any future heads of claim which they are confident the Trial Judge will capitalise, but only if the claimant can show there is a real need for the interim payment before trial.  For the most part cases that have failed are those that have progressed to the second stage.

AC was concerned with an application on behalf of 7 year old claimant for an interim payment of £1,203,300 to enable him to purchase appropriate accommodation and to buy in care and therapies.  The claimant had suffered significant brain damage at birth due to the defendants’ negligence and whilst he was left with some mobility issues he was not so impaired that there was a requirement for significant adaptations to the property.

The defendant accepted that the property in which the claimant lived with his family was not suitable and that he would need to live with his family for the foreseeable future, but they considered it more appropriate for the family to rent a property and allow the Trial Judge to decide what the best accommodation model would be.   The Court rejected the defendant’s argument noting that there was no authority to say a claimant was required to rent.  Mrs Justice Whipple assessed accommodation costs on a standard Roberts v Johnstone basis and also took into account adaptation and running costs.  On a conservative basis she assessed the likely award for losses certain to be awarded as a capital sum at £1,337,000 and took 90% as a reasonable proportion, giving  the claimant the full interim payment requested.  It was not necessary to consider Eeles 2 but Mrs Justice Whipple noted that even if she had found it necessary to move onto this stage she would still have awarded the interim payment.   She indicated that she would have found that the claimant needed the interim payment now and further that she was confident the trial judge would have capitalised other future losses, such as loss of earnings, to enable a home to be purchased.

The claimant was probably assisted in the case by the fact that this was the first interim payment request and further that the defendant had not produced evidence, but the decision is good authority that all is not lost and that in appropriate cases, claimant’s solicitors can and should press for interim payments to avoid claimants having to make do for longer than is strictly necessary.

* Disclaimer: The information on the Anthony Gold website is for general information only and reflects the position at the date of publication. It does not constitute legal advice and should not be treated as such. It is provided without any representations or warranties, express or implied.*