Not in the victims’ interest

A Bill on the computation and quantification of damages is currently being discussed in Parliament. According to the government, the aim of this piece of legislation is to have clear rules on how damages should be quantified and what type of damages can be claimed by victims in view of the different interpretations and rules applied by our courts in such cases. Although this Bill is positive in some aspects, such as in establishing clear rules as regards non-pecuniary compensation (another word for “moral damages”), there are several other aspects that are negative that make the introduction of this Bill amending the Civil Code surely not in the victims’ interest.

The Bill stipulates that the victim is entitled to lucrum cessans damages (damages for loss of earning) not exceeding €600,000 unless otherwise established by the minister who has the power to issue subsidiary legislation in this regard. One can say that there are few instances in our case law where damages exceed this amount. This capping, however, should not work against victims who are still young or have high salaries or have a high percentage of permanent disability and who therefore may be entitled to a higher amount. The present situation is that the Court of Appeal has the final word in liquidating the amount of damages that a victim is entitled to. This method always worked well on the whole and thus there is no reason for it to change. Ministerial discretion or legislative intervention should not intrude in the area.

The Bill proposes that the formula used to quantify the damages takes into consideration the net income of the victim. This is contrary to the current situation which is based on the gross income of the victim according to the trend established by our case law. Unfortunately, this means that the damages awarded will be less, to the prejudice of the victim.

The fact that after the accident the victim carries on a working activity will be taken into consideration when calculating damages. Certainly, this does not make sense because according to what out court continuously upheld, the amount to be allocated as lucrum cessans is awarded to the victim on the basis of the work he cannot continue to carry out due to his permanent disability and not the contrary. Thus, what is proposed runs counter to what our courts have consistently held for years!

In the mentioned formula there is the concept that “lump sum reduction” should remain at 20 per cent of the global amount awarded as lucrum cessans. This is usually reduced because it takes into consideration the fact that the victim receives the sum awarded as a one-time payment. This definitely prejudices the victim because our courts always took into consideration the lengthy court proceedings when it is the case and this to ensure that justice is done in the victim’s regard in those cases which take long to be decided.

The formula of the “weighted average” as proposed in the Bill in the case of a victim suffering from multiple permanent disabilities should be applied by our courts only as guidelines and not automatically as is proposed. This is because our courts always used discretion in establishing the global percentage permanent disability when there is multiple disability after careful assessment of the victim by the medical experts or after they considered the circumstances of the particular case before them. The use of a pre-established formula unnecessarily binds our courts and limits their discretion. When these cases arose, our courts came to a just conclusion of every party involved in most cases.

A victim who at the time of the accident was not earning an income and does not show this future intention, is, according to the Bill, not entitled to damages but is given compensation only if there are dependent persons based on some type of maintenance. This is opposed to the position adopted by our courts which favours the victim and awards them damages.

Many rules proposed by this Bill are found in the “subsidiary legislation” proposed simultaneously with the Bill. The rules contained in the subsidiary legislation, if they become law, will not form part of the Civil Code. This means that the minister is free to unilaterally change these regulations from time to time without being subjected to Parliament’s scrutiny. This excessive ministerial discretion is surely dangerous and is in my opinion uncalled for.

Although there is indeed scope for some legislative intervention in this field, this Bill is not advantageous to the victim. The discretion which our courts have today will end and instead wide discretionary powers are given to the minister who can unilaterally and without parliamentary scrutiny issue regulations. On the other hand the government has to ascertain that every person, including the employees, have a proper insurance policy so that the victim is paid the damages he is awarded.

Furthermore, in my opinion, legislative intervention in this particular field has to be wider in scope than that proposed in the Bill. The government has an obligation to ensure that the victims’ interests are safeguarded in the amounts they receive as damages. This does not necessarily mean that such safeguards should translate in higher insurance “premia”. The government must also ensure that such insurance “premia” are affordable and insurance covers are made more accessible so that more persons who have an insurable interest, especially employers, insure such risk.

Dr Zammit-Lewis is a litigation lawyer, mainly in the civil law sphere, including law on torts.