Case: Finnis v Caulfield (t/a James Car Hire)

24th October 2002
IN THE HIGH COURT OF JUSTICE ACTION NUMBER: HQ 00 04522
QUEEN’S BENCH DIVISION TRIAL NUMBER: TLQ 01/0733

KEVIN FREDRICK FINNIS
(By his Wife and Litigation Friend Lisa Finnis)
Claimant
v.

JAMES CAULFIELD
Trading As JAMES CAR HIRE
Defendant

Future Earnings Potential - The Big Break - Specific Importance of Lay and Expert Witness Evidence in such claims - Recoverability of Undeclared Income - Loss of Congenial Employment

In July 1997 the Claimant was riding his motorcycle along a main road when the Defendant pulled out directly in front of him. He had no opportunity to take avoiding action and collided with the side of the Defendant’s vehicle. The force of the accident was such that his crash helmet was forced from his head despite being properly fastened. He was left with catastrophic frontal lobe brain damage which manifested itself in a variety of ways. The Claimant had very poor concentration and memory. He was easily tired and succumbed to depression. He could no longer tolerate even moderate amounts of drink and could become abusive when drunk. He had suffered various orthopaedic injuries all of which resolved with time but injuries affecting his sight and hearing contributed to his general inability to work. Liability was admitted and the hearing was set down for assessment only.

The Claimant was 29 years old at the time of the accident. He worked as a floor layer but had been unusually successful. He started work at the age of 16 with a nationwide floorlaying company, Miletrian. He had bought his first house when only 18 years old. He had spent almost all of his time working for a national floor laying company. Evidence was lead at trial that he was an excellent floorlayer and was adept in fitting a wide range of surfaces. He had worked as a foreman and possessed both the authority and the intellect to ensure that work was carried out efficiently by his team of floorlayers. He was said to have good communication skills and was able to pass on his knowledge to others.

Miletrian was family run and he had always been very close to the brothers who owned it. Shortly before the accident he set up his own flooring company. The majority of his work was supplied on a sub-contract basis by Miletrian. However, the week before his injury he was given a substantial contract by another company, Skyline. That alone would have generated more than £200,000 of turnover for him in the first year. This was to be his “big break”.

In addition to the sub-contract work and his “big break”, evidence was called which supported the proposition that he would have earned small additional cash sums by way of occasional jobs on the side.

At an early stage in proceedings the Defendant had raised as an item of contributory negligence the fact that the Claimant’s helmet had not been properly fastened. The only evidence adduced in support of that notion was the fact that the helmet had come off. The Claimant’s solicitors made an early Part 36 offer in relation to that issue alone. Some time afterwards the Defendant conceded the issue and was ordered to pay the costs incurred in dealing with it on an indemnity basis.

The Claimant required a significant degree of care. There was no doubt that his wife was a caring and loving partner but the stress and strain of living with her brain damaged husband had taken its toll and there was a chance that she would leave if his behaviour at home deteriorated. The cost of buying in care for him would have been very high. His life expectancy had not been affected by his injuries.

There was considerable conjecture as to the likelihood of the Claimant maintaining and building upon the Skyline business. Although clearly an excellent floorlayer his abilities as a businessman had not been tested. It was suggested on his behalf that his wife would have run the administrative side of his business and she was able to rely upon a history of employment in the retail industry at a management level in support of that argument. In order to support his claim for future loss of earnings the Claimant produced statements from 29 lay witness statements and reports from 13 experts. There were 460 pages of statements used at trial. In the end 8 witnesses and 2 experts gave evidence at trial. The rest being agreed just before trial started.

At trial a number of issues remained:

(a) what was the Claimant’s future earning potential?
(b) should he be allowed recovery in respect of those sums which he would have earned by way of cash and upon which tax would not have been paid?
(c) what was the Claimant’s residual earning capacity?
(d) how was the Court to take account of the possibility that the Claimant’s wife would leave him?

In relation to those issues the Judge found as follows:
(a) Future Earning Potential
The Claimant advanced three possible scenarios for his future earnings. The figures had been carefully prepared by an expert forensic accountant and were based upon the lay evidence as to his potential earnings. The first scenario proposed that the Claimant would continue earning only at the level of his pre-accident earnings; the second allowed for the “big break”; the third allowed for the “big break” and hypothesised a further similar break in the future. The Learned Judge accepted that the first big break was made out on the evidence but not the second.

(b) Undeclared Income
The Court was referred to the two authorities of Hunter v Butler CA [1996] RTR 396 and Newman v Folkes CA [2002] EWCA Civ 59. Hunter was cited by the Defendant in support of the contention that undeclared income was not recoverable at all. The Claimant relied upon Newman where Ward LJ upheld the first instance decision that the income was recoverable subject to deductions for deductions which would have been made had the income been properly declared. Butler was distinguished by the Claimant on the basis that it involved a situation where the income itself had actually been obtained fraudulently. The Learned Judge accepted those arguments.

(c) Residual Earning Capacity
There was much argument on this issue. The Claimant had endeavoured to return to work and his solicitor had been instrumental in arranging assessments and finding work placements for him. Nevertheless it was clear that he could not work without significant supervision in the future. The Defendant suggested that a place could be found for him on one of the supported employment schemes in operation. At trial the Defendant’s evidence on this issue was the subject of detailed cross-examination. The Claimant’s employment expert had followed up the routes suggested by the Defendant’s expert and it transpired that the availability of supported work to brain injured victims was not as prevalent as had been advanced. The Judge accepted the Claimant’s evidence on this point.

(d) Likelihood of Separation
The Learned Judge declined to make an award for the cost of future care based on the Claimant’s wife leaving him but instead awarded a straightforward lump sum of £50,000.

Quantum
The Judge awarded £95,000 in respect of general damages and £5,000 to compensate for the Claimant’s loss of his congenial employment. The Claimant was awarded £238,756.75 for past loss of earnings and care £819,630.00, for future loss of earnings and £230,007.64 for future care. The remainder was miscellaneous and Public Guardianship Office. The total damages award was £1.487,562.33.

Michael Mylonas & John Grace QC, both of 3 Serjeants’ Inn, for the Claimant. Instructed by McMillan Williams (New Addington branch, conducting solicitor Colum J Smith).

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