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Cite as: [2005] ScotCS CSOH_100, [2005] CSOH 100

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Stewart v. Daniel Montgomery & Son Ltd [2005] ScotCS CSOH_100 (28 July 2005)

OUTER HOUSE, COURT OF SESSION

[2005] CSOH 100

PD734/04

OPINION OF LORD MACPHAIL

in the cause

ADRIAN STEWART

Pursuer;

against

DANIEL MONTGOMERY & SON LTD

Defenders:

________________

Pursuer: A Smith Q.C., Love; Digby Brown S.S.C.

Defenders: A.R.W. Young; Simpson & Marwick

28 July 2005

1. Introduction
[1] This is an action of damages for personal injuries in which the only issue is the sum to be awarded to the pursuer in name of future loss of earnings. The defenders admit liability to make reasonable reparation to him with no finding of contributory negligence. With the exception of his claim for future loss of earnings, damages are agreed, inclusive of interest to date, in the sum of £50,000.

2. The pursuer's injuries
[2] The pursuer sustained serious injuries to his left arm and hand when he was working in the course of his employment with the defenders on 22 January 2003. He was investigating a fault in a moulding machine. After he placed his left arm inside the machine, the door of the machine closed and trapped his arm, causing crushing injuries to his arm and hand. The nature, extent and medical consequences of the accident are detailed in many medical records and reports which the parties by joint minute have agreed to be true and accurate. The following is a summary of the pursuer's condition in so far as it has a bearing on his ability to work in the future.

[3] The accident was painful and frightening. The pursuer was treated in hospital and underwent several surgical operations. He has been left with limited movement of the left wrist, with a significant reduction in his ability to rotate it so that the palm surface is uppermost. He also has limited finger flexion in the left hand, so that he cannot make a fist. He has lost the tip of his left little finger. He has extensive scarring of the left forearm, wrist and hand, and his injuries are painful in cold weather. He is no longer fit for his pre-accident work, or for any activity that requires full use of both hands. In addition he suffered and continues to suffer from post-traumatic stress disorder. The accident provoked depression and anxiety, for which he received treatment. He is no longer depressed, but he continues to experience clinically significant levels of anxiety. He now feels uncomfortable with the noise, smell and heat of the shop floor, and feels troubled by machinery in general. He should continue to improve, particularly after this litigation is concluded, since it represents a major stress for him. He is nevertheless likely to be left with significant problems in coping with his injuries for the foreseeable future.

3. The pursuer's pre-accident history
[4] The pursuer was born on 11 May 1973 and thus is 32 years of age. He left school at 16 having obtained two O-grades, in technical drawing and in craft and design. He did not do well in his other subjects. He served an apprenticeship with the defenders in the course of which he went to college and obtained an Ordinary National Certificate in polymer technology. He did not go on to obtain a Higher National Certificate. When he was about 18 years old he took a three-month course at an engineering college for which the college did not award the students a certificate. He remained in the defenders' employment and became a plastic injection moulding engineer. That work entailed bolting moulds into a moulding machine and making plastic parts. He became a supervisor at the age of 20. He continued in the same job until the accident, with two breaks. In 1995 he was made redundant because of a downturn in work and was unemployed for one year, having tried and failed to obtain another job. Some eleven months after he returned to work with the defenders, he was made redundant once again. He obtained similar work with another employer for about two years. He went back to the defenders when they offered him a higher wage than he was earning with the new employer and than he had previously earned with the defenders. His earnings with the defenders included an element of overtime which was regularly available to him. He was not working as a supervisor at the time of the accident. He enjoyed his work with the defenders. He considered himself to be well thought of and he intended to remain in their employment.

[5] Thus far, there is no dispute between the parties. It is now necessary to ascertain what the pursuer's earnings would probably have been if the accident had not occurred and his probable actual earning capacity in the future, and to apply an appropriate multiplier to his annual future loss. These matters were contentious. I heard the evidence of the pursuer and his father; Mr Timothy Storrie, the defenders' plant manager; and two expert witnesses: Mr Keith Carter, an employment consultant, who gave evidence for the pursuer, and Mr Gordon Cameron, a vocational consultant who was called by the defenders. Mr Carter's report is no. 6/1 of process, and Mr Cameron's is no. 7/6. The only witness whose credibility and reliability was criticised at the hearing on evidence was Mr Storrie, whose evidence about the availability of overtime at the defenders' factory the pursuer's counsel described as somewhat unsatisfactory. My own assessment of the witness's testimony on that issue was that it was not clear and consistent, and I was not convinced that opportunities for overtime would not continue to be available as they have been in the past.

4. The pursuer's future earnings if no accident
[6] First, I have to form a view as to the pursuer's probable future working career if he had not been injured. Both parties assumed, and I agree, that it is probable that he would have continued to work for the defenders. The pursuer said that he expected to be promoted in due course to a management post as a process manager, moulding shop manager or technical manager. I accept, however, the evidence of Mr Storrie that such promotion cannot be predicted, and I am unable to find that such a promotion was a probability. I consider that the pursuer would probably have continued to work for the defenders at the level of his pre-accident job.

[7] In that situation, according to the unchallenged figures and calculations put forward for the pursuer, his net earnings would now be £21,938 per annum. The rate of his pre-accident earnings appears from no 6/24 of process. It further appears from the earnings of a comparable employee (no 6/20 of process) that the pursuer could have expected a percentage increase year upon year of 2.2% in February 2003 and 2.25% in April 2004. A fair estimate of the percentage increase in April 2005, for which no figure is available, is again 2.25%. The result is a figure of £21,938. That figure includes overtime which, as I have indicated, should be assumed to continue to be available.

5. The pursuer's actual future earnings
[8] Since his return to work after the accident the defenders have employed the pursuer as a quality control technician. The factory makes bottle tops. The pursuer works in an office. Someone brings bottle tops to him and he arranges them on a machine which measures them. The pursuer prints out the results and files them in folders. The pursuer does not enjoy this work: he does it all day, every day, and finds it boring and unsatisfying. He no longer feels comfortable working for the defenders, although he acknowledges that they have given him much time off work in order to attend his various medical appointments. He feels that he needs a fresh start, and he hopes to leave the defenders' employment in a matter of months. The defenders' counsel very fairly did not criticise him for taking that view, and discounted any possibility that he might remain with the defenders in a better-paid job. I shall therefore assess the pursuer's actual future earnings on the basis that he will leave the defenders' employment. I shall ignore the comparatively short period of his remaining time with them and I shall assume that he will leave with immediate effect.

[9] When he leaves the defenders, the pursuer will have three options. One is to obtain a job that would not require him to obtain any new skills or qualifications, or in which any training would be minimal or would be provided "on the job". I shall refer to such a job as "an unskilled job". A second option is to undertake extensive education or training over a period of some four years. A third is to undertake a shorter period of training. In each case there would be a period of "job search", that is, a period of unemployment while he was looking for a suitable job.

[10] I do not consider it probable that the pursuer would be content with the first option, that is, with looking for an unskilled job. He is bored by his present job and in my view he would not be likely to exchange one such job for another. He made it clear that he wanted to find a satisfying occupation. He said at one stage that he did not know how he would cope with retraining. I consider, however, that his diffidence in that regard should not be given serious weight. He is still suffering from clinically significant levels of anxiety, not least because of this litigation. He said he had had anxiety about it, and it would be a weight off his mind when it was over. I think it is probable that thereafter the pursuer will feel more confident about the future. It appeared to me that the true picture emerged at the end of his cross-examination when he said that he intended to use his damages to support himself while he retrained and that his thought was that he could retrain for a year or two. The pursuer's expert, Mr Carter, questioned whether he would apply himself to retraining and pointed to his age, the low qualifications with which he left school, and his lack of confidence in himself. In Mr Carter's view the most probable outcome was that the pursuer would not retrain. I consider, however, that Mr Carter was unduly pessimistic. The pursuer impressed me favourably as an intelligent, industrious man with a pleasant personality who was keen to obtain more challenging work than he is doing at present. He will also be motivated to do so by the fact that if he were to move from the defenders' employment to an unskilled job, he would earn less than he does now. The defenders pay him well - "over the odds for what he's doing", in the words of Mr Cameron - and in an unskilled job with another employer he would be likely to earn less - on Mr Cameron's figures, in the region of £10,184 net per annum instead of £10,700. I have therefore concluded that once this litigation is over the pursuer will feel confident enough to move forward and look for some appropriate retraining and a job that he would find interesting and adequately paid.

[11] The question then comes to be, what kind of retraining will he probably choose? I do not find it probable that he would go to a university or college for three or more years. He would be starting off from a low academic base of two O-grades and an ONC certificate. He would therefore have to obtain an entrance qualification before he could embark on a course of tertiary education. In addition, and more significantly, the pursuer is not academically inclined. He said he had not really enjoyed going to the college to obtain his ONC certificate. He also said that he did not like the thought of college: it was not him, he was hands-on, better suited to working with tools than to classroom work. His father, Mr John Stewart, said he did not think the pursuer would be suited to study: he had never been interested in going to university or college. I am therefore satisfied that such a course is not an option the pursuer would choose. I consider that he was sensible when he said at the end of his cross-examination that he was thinking of retraining for a year or two.

[12] The pursuer expressed interest in learning about computers. He knows little about information technology at present, but he has been attracted by some of the IT courses he has seen information about on the Internet. The pursuer lives in Kirkintilloch. He could undertake a training course of about 12 or 18 months' duration which would qualify him to work as a computer helpdesk operator. There are also one-year HNC courses available in Glasgow in computer-aided draughting and design. The pursuer could also use computing skills to work as an accounts clerk, although at present he is disinclined to consider office work. His earnings in such jobs cannot be predicted with accuracy. Mr Carter suggested net annual earnings of £14,010 and Mr Cameron £12,194. A figure of £13,000 would therefore appear to be a reasonable estimate. The training period, together with a period of job search, may reasonably be estimated at two years. Thus for each of those two years the pursuer would sustain a loss of £21,938, that is, £43,876. Thereafter he would sustain an annual loss of £21,938 less £13,000, that is, £8,938.

6. The multiplier
[13] The pursuer's counsel invited me to select a multiplier on the basis that the pursuer's retirement age would be 70. Counsel said that while that had not been done in any other case, no evidence on the subject had been led in these cases. Here, however, Mr Carter had given evidence that in his opinion 70 would become the compulsory retirement age. I do not consider, however, that Mr Carter was specially qualified by knowledge or experience to state such a view. The pursuer's counsel also submitted that it was perhaps within judicial knowledge that the question of the compulsory retirement age was being actively considered by the Government. Be that as it may, any future change in the retirement age is not a matter of such certainty and notoriety as to fall within the scope of judicial knowledge. I shall therefore assume that in accordance with the present law the pursuer's retirement age will be 65.

[14] In Table 9 of the fifth edition of the Ogden Tables the multiplier for loss of earnings to pension age 65 for a male of 32, at the rate of return of 2.5%, is 21.94. That multiplier then falls to be reduced by multiplying it by a figure calculated to take account of contingencies other than mortality. That figure is arrived at, first, by taking the appropriate figure from Table A in paragraph 32. The figure in the medium set for a male of 30 is 0.97, and for a male of 35 is 0.96. For the pursuer, who is now over 32, it is appropriate to take a figure of 0.965. The explanatory notes advise, however, that that figure should be adjusted to take account of variations by occupation and by geographical region. The pursuer's occupation is likely to be among the less risky, and the figure should therefore be increased by a maximum of the order of 0.01 up to age 40 (page 13, paragraph 36). On the other hand, to take account of variations by geographical region, it should be reduced by a maximum of the order of 0.01 at age 25, or 0.02 at age 40, for persons resident in Scotland (page 13, paragraph 39). If the figure is increased by 0.01 and reduced by 0.015, it becomes 0.96. The multiplier accordingly becomes 21.06 (21.94 x 0.96 = 21.06).

[15] The pursuer's counsel urged me not to adjust the figure of 21.94 as recommended in the explanatory notes. He referred me to "Changes in the fifth edition of the Ogden Tables", an article by the Chairman of the Ogden Working Party, Mr Robin de Wilde QC, in the issue of Quantum dated 24 January 2005. Mr de Wilde there writes that the inaccuracies in the figures used in Tables A, B and C in the section headed "Contingencies other than mortality" have been accepted, and further work is to be done for later editions. He also says, "Anecdotal reports have suggested that practitioners often ignore this area". He does not say, however, that courts do so. In his introduction to the fifth edition of the Tables Mr de Wilde writes:

"25. Certain inaccuracies have been noted in the figures used in Tables A, B and C for contingencies other than mortality. These inaccuracies were first revealed in the paper by Professors Lewis and McNabb. They have since been confirmed by and acknowledged by the authors of the original paper, Haberman & Bloomfield, as due to incomplete data. We have not been inclined to remove those Tables completely, for they do give an indication of the factors that should be considered. We are attempting to commission new work on this aspect for later editions of these Tables. Better figures may take some time to produce and a 'health warning' exists on those presently produced".

I have decided that I should adhere to the practice of using the Tables as recommended, in the absence of special factors or any precise information as to the extent to which they may be inaccurate when applied to the pursuer.

6. Other matters
[16] Counsel for the pursuer argued that a sum should be awarded to cover the cost of retraining. Counsel for the defenders timeously objected when a question was put to Mr Cameron on this subject in cross-examination. I allowed the questions to be put under reservation, but in the event, even if such evidence were to be admissible, no sufficiently precise evidence as to the cost of retraining emerged.

[17] The pursuer's counsel also submitted that a significant award should be made for prejudice on the labour market, to cater for further extended job search in the future, the uncertainty of job security, the difficulty which it was said the pursuer would have as a disabled person obtaining work, and the risk of further absence due to operative surgery taking place. There was no evidence, however, that once he had obtained a qualification the pursuer would suffer prejudice on the labour market. The defenders' expert, Mr Cameron, said at paragraph 4.2.1 of his report that if the pursuer retrained for a new career that was within his now reduced functional capacity, he should not be at a marked disadvantage for the jobs to which he was functionally suited. That view appears to me to be reasonable, and I accept it. The risk of absence due to future surgery appears to me to be speculative, and there is nothing in the evidence or the agreed documents to suggest that any such absence would be long-term.

7. Result
[18] I therefore calculate the pursuer's future loss of earnings as follows. I allow two years for retraining at £21,938 per year: £43,876. The multiplier of 21.06 is reduced by those two years to 19.06. The multiplicand is £8,938. The result of the multiplication is £170,358.28. The total is £214,234.28, which I shall round up to £214,235. Since the agreed damages, excluding the element of future loss of earnings but inclusive of interest to date, are £50,000, I shall grant decree for £264,235, with interest at the ordinary rate from the date of decree until payment.