HSE denied appeal over damages for catastrophic injury

The Supreme Court has refused to allow the HSE to bring a further appeal against a significant ruling seen as paving the way for higher damages awards for people who suffer catastrophic injuries.

The three-judge Supreme Court indicated it might consider such a point in the future in an appropriate case which met the requirements for a Supreme Court appeal.

The High Court ruling at issue, effectively upheld by the Court of Appeal in November 2015, has significant implications for the HSE, the State and the insurance industry.

The HSE disputed the approach taken by the High Court when assessing some €12.25 million damages for Gill Russell (9), who suffered brain damage at birth and has dyskinetic cerebral palsy and needs lifelong care. The total damages in the case were €15.9 million.

Through his mother, Karen Russell, Aghada, Co Cork, Gill sued the HSE alleging negligence in the circumstances of his birth at Erinville Hospital, Cork, on July 12th, 2006.

‘Chaotic’ delivery

It was claimed Gill was born after his mother had a symphysiotomy and there was a “totally chaotic” delivery. Liability was admitted and the High Court was asked only to assess damages.

The High Court decision altered the existing position whereby money for future care and expenses is awarded on the assumption, when invested, it will gain interest at an annual rate of 3 per cent.

A discount to allow for that 3 per cent “real rate of return (RRR)” (the nominal rate less the rate of inflation) was built into awards over the past decade.

The Court of Appeal adjusted the RRR order to show the rate on future care was 1 per cent, with a rate of 1.5 per cent applying to all other claims for future pecuniary loss. The decision meant the value of awards would be higher.

The Court of Appeal effectively upheld almost the entire High Court decision and said the HSE’s argument about the widespread economic effects of increased awards could not be allowed to affect the court’s approach. Unless the rate were reduced, a catastrophically injured person would have to take “unjust and unacceptable” investment risks with funds necessary to meet their lifetime care costs.

The “sad fact” was neither this child, nor the HSE, would be in court had governments not failed over decades to enact laws allowing compensation to be paid via periodic payment orders, it added.

Public importance

The HSE asked the Supreme Court for permission to appeal the Court of Appeal ruling in relation to the interest rate issue only. It argued the decision was of general public importance with implications for other awards.

In a published determination on Friday, the Supreme Court refused permission for an appeal. It said the HSE’s argument the financial consequences of the High Court decision were “very significant indeed” had not been made in the High Court and was dismissed by the Court of Appeal.

No evidence was provided to either of those courts to ground that claim and, because this argument was not made in the High Court, the Russell side had no opportunity to seek details of what exactly the HSE meant by that claim and to call evidence to rebut it, it said.

Without any “acceptable explanation” for why the HSE had not raised the issue in the High Court, the Supreme Court said it was “seriously doubtful” the HSE’s claims of the implications for the insurance industry and the State could be relied upon in addressing the necessary criteria for permission to appeal.

It was also “instinctively unsatisfactory” for the Supreme Court to hear an appeal when, in substance and reality, the underlying case had settled.

The complaint here was very much “fact specific”, it stressed. On the facts of this case, the HSE had not raised an issue which, in the interests of justice, it was necessary to have further reviewed.