The Compensation Culture in Great Britain - Case Study Example

The compensation culture in Great Britain is focused on restitution. The concept and purpose of common law and sta y provision is place the victim in the position he or she was in prior to the incident in which he was injured. To achieve this goal it is necessary for blame to be assigned. To some extent, the victim himself is partly to blame. Without insurance, compensation may not be a satisfactory option for the victim. Common law and statutory provisions have struggled with blame assignment and contributory negligence issues until it is impossible to identify a consistent set of guidelines. As conditions and economics change the old common law principles and statutory provisions are becoming increasingly inadequate. To this end, the Compensation Act 2006 is necessary for narrowing guidelines that have become too broad and for dispensing with archaic policies if nothing else. In the landmark case, Donoghue v Steveson, Lord Buckmaster made a simple observation, that to this day resonates reality. Referring to the assignment of blame and doctrine of the duty of care Lord Buckmaster said; ‘The law applicable is the common law, and, though its principles are capable of application to meet new conditions not contemplated when the law was laid down, these principles cannot be changed nor can additions be made to them because any particular meritorious case seems outside their ambit.’ (Donoghue v Steveson [1932] p 567) This case was a turning point in the compensation culture in Great Britain, because the doctrine of propriety estoppel arose to bar an action in negligence in the absence of a contract between the complainant and the defendant or in the absence of a statutory duty of care. Donoghue v Stevenson revisited this principle and determined that a contract was not necessary to establish a duty of care in certain circumstances. Similarly, years later The Consumer Protection Act 1987 later amended by the General Product Safety Regulations 1994 would codify the duty of care between the manufacturer and the ultimate consumer. These provisions successfully knit together a broader concept of a duty of care between non-contracting parties. The Consumer Protection Act 1987 as amended places a duty of care on all manufacturers of consumer goods to the extent that it is not dangerous or defective. This broadens the class of potential litigants.(Consumer Protection Act 1987 and General Product Safety Regulations 1994) The Compensation Act 2006 attempts to circumvent the onerous task facing courts in sifting through the number of claims founded on the application of the neighbor principle enunciated by Lord Atkin in Donoghue v Stevenson and the ensuing development. Lord Atkin held that a duty of care exist so that an individual must take all necessary precaution to prevent injury to one’s neighbor. ‘Who then in law is my neighbour? The answer seems to be persons who are so closely and directly affected by my act that I ought to have them in contemplation as being so affected when I am directing my mind to the acts or omissions which are called to question’. ( Donoghue v Stevenson (1932) AC 562) Lord Atkin’s neighbor principle has been developed over the years and is now firmly established, although varied only slightly to reflect firmer application of the rule. The Compensation Act 2006 might be seen as a means of incorporating the neighbor principle, leaving little wriggle room. It also takes into consideration the developments that elaborated on the neighbor principle. In order to understand the impact of the 2006 Act, it is necessary to examine the common law developments following Donoghue v Stevenson. To begin with, in Anns v Merton London Borough Council it was held that the test for the duty of care consisted of three primary functions. Its first function was to determine the remoteness of damage. Put another way, the resulting harm must have been foreseeable. Secondly, the relationship between the parties must be of sufficient proximity to impose a duty of care. The imposition of a duty of care is necessarily connected to the question of custody and control of the place and circumstances that give rise to the harm complained of. Last, but by all means not least, the court must be satisfied that in all the circumstances of the case the imposition of a duty of care is fair and just. (Anns v Merton London Borough Council (1978) AC 728) Moreover, it was decided by the court in Murphy v Brentwood that proximity is a useful tool for determining the existence of a duty of care. Significant indicators of proximity will relate to aspect of responsibilities of the relevant parties as well as reliance issues. (Murphy v Brentwood District Council [1991] 1 AC 398) The preamble to the Compensation Act 1996 appears to indicate that the Act’s purpose is to short circuit the onerous task judges have applying common law principles relating to the duty of care. It also indicates that it intends to regularize the compensation culture in Great Britain. The preamble states as its purpose that the Act is ‘An Act to specify certain factors that may be taken into account by a court determining a claim in negligence or breach of statutory duty; to make provision about damages for mesothelioma; and to make provision for the regulation of claims management services.’ (Compensation Act 2006) With this preamble in mind the conclusion that the 2006 Act serves a useful purpose is inescapable. Yet when one looks at the opening statements it becomes increasingly clear that legislators are attempting to limit the aggressive application of the neighbor principle. It is obvious that the courts have become inundated with compensation claims that require prolonged litigation and exhaustive examination of common law principles. Section 1 of the Act is entitled: ‘Standard of Care: Deterrent effect of Potential Liability.’(Compensation Act 2006 Section 1) Section 1 provides as follows:- ‘A court considering a claim in negligence or breach of statutory duty may, in determining whether the defendant should have taken particular steps to meet a standard of care (whether by taking precautions against a risk or otherwise), have regard to whether a requirement to take those steps might— (a) prevent a desirable activity from being undertaken at all, to a particular extent or in a particular way, or (b) discourage persons from undertaking functions in connection with a desirable activity.’ (Compensation Act 2006) The remainder of the Act is dedicated to two issues. The first part is dedicated diseases connected to asbestos poisoning and liability for those specific diseases. The cases of asbestos related industrial suits have been on the rise in the last decade and perhaps it is necessary for legislators to codify and regulate these claims. They are numerous enough to require special attention. The second half of the 2006 Act directs its attention to the creation and regulation of a negligence claims’ service. This is similar to the employment tribunal regulations and is necessary for relieving the courts of the duty of sorting out voluminous claims and also helps with the expeditious disposal of negligent claims. It also provides a similar service for victims of criminal claims who are compensated under the provisions of the Criminal Injuries Compensation Act 1995. This can and will benefit both parties to a straightforward compensation claim. Negligence claims against medical institutions are reflective of the necessity for expeditious resolution. Many of the victims are already injured when they are submitted for treatment, only to have their condition complicated by negligent medical attention. More often than not, compensation is necessary for the commencement of corrective treatment. A negligence claims’ service can speed up the litigious process and render treatment affordable at a faster rate than prolonged court trials. Lord Wilberforce maintained that ‘…first, it is sound principle that where a person has, by breach of duty of care, created a risk, and injury occurs within the area of that risk, the loss should be born by him unless he [the defendant] shows that it had some other cause. Secondly, ...just because honest medical opinion can not segregate the cause of an illness between compound causes. ...as a matter of policy or justice ... it is the creator of the risk who, ex hypothesis, must be taken to have foreseen the possibility of damage, who should bear its consequences.’(Fairchild v Glenhaven Funeral Services Ltd (2002) 1 WLR 1052) In any event, it must be borne in mind that in medical negligence cases, the defendant already has to cross a difficult threshold in order to substantiate a successful claim. Mr. Justice Gibbs said ‘He must be able to demonstrate that the standard of care fell short of that set by the Bolam test.’ (Carty V London Borough of Croydon [2005]) By virtue of the Bolam test a claim in liability in respect of medical negligence can only be founded if the medical professional is found to have acted in a manner not acceptable by current medical practice of the same field. (Bolam v Friern Hospital Management Committee [1957] 1 WLR 582.) The Bolam test has survived for fifty years with little modification. The difficulty with this test however, is that is makes provision for doctor’s to escape liability by merely calling another medical professional to testify that he or she has used the same medical technique in the past. As a result of the Bolam test, this testimony might very well exonerate the medical doctor whose medical technique resulted in some injury to the plaintiff. A slight modification of the Bolam test was introduced in 1997 by Lord Browne-Wilkinson in Bolitho v City and Hackney Health Authority. The so-called Bolitho test functions to restrain the application of the Bolam test. Lord Browne-Wilkinson said that ‘The court should not accept a defence argument as being reasonable, respectable or responsible without first assessing whether such opinion is susceptible to logical analysis. However, where there is a body of medical opinion which represents itself as reasonable, responsible or respectable it will be rare for the court to be able to hold such opinion to be other than represented.’ (Bolitho v City and Hackney Health Authority [1997]) The result of the Bolitho test is that if the testimony of the medical expert is found to be unreasonable the doctor accused of medical negligence can be found liable. However, this is only going to happen in limited circumstances. The impact of the Bolam test and its follower, the Bolitho test makes it difficult for medical negligence cases to be dispensed with before the designated negligence claims’ services. Such claims require onerous litigation and liability is not as straightforward as cases involving ordinary neighbor principles. In light of the Bolam test, the Compensation Act 2006 appears to be premature. The finding on the court in Caparo Industries Plc v Dickman also makes the Compensation Act 2006 somewhat unnecessary. The only use one can apply to it is the codifying of the three principles found in the Caparo case. Section 1 of the Act empowers the courts to adapt these principles which can be summarized as follows:- 1. foreseeability of the damages complained of; 2. proximity between the parties; and 3. the imposition of a duty of care is not on reasonable but fair in the circumstances. (Caparo Industries Plc v Dickman [1990] 2 AC 601 at ppp 617-61) The authorities all seem to have already adapted a course which readily complies with the provisions of the Compensation Act 2006. Lord Diplock himself had imposed a restriction on potential liability when he ruled in Dorset Yacht Co. Ltd v Home Office that ,the concept of a duty of reasonable care was one with which the courts were familiar in the nineteenth century as constituting a cause of action in negligence.’ He qualified that statement by adding that a duty of care will only be imposed if it was just and fair to impose one. (Dorset Yacht Co. Ltd v Home Office (1970) AC p. 1004) The Compensation Act 2006 for the purpose of limiting liability might merely be a restatement of the standard of care already imposed by the courts over the years. However, as it relates to the duty imposed by statutory provisions such as The ConsumerProtection Act 1997, The National Health Service (Liabilities to Third Parties Scheme) Regulations 1999, the 2006 Act is necessary for the regulation of claims brought under these statutory provisions. Sources Anns v Merton London Borough Council (1978) AC 728 Bolam v Friern Hospital Management Committee [1957] 1 WLR 582. Bolitho v City and Hackney Health Authority [1997] Caparo Industries Plc v Dickman [1990] 2 AC 601 Carty V London Borough of Croydon [2005] Case No: A2/2004/044 Compensation Act 2006 Criminal Injuries Compensation Act 1995 Consumer Protection Act 1987 Donoghue v Stevenson [1932] AC 562 Dorset Yacht Co. Ltd v Home Office (1970) AC p. 1004 General Product Safety Regulations 1994 Murphy v Brentwood District Council [1991] 1 AC 398 Read More