DAMAGES (SCOTLAND) BILL [H.L.] (Hansard, 18 December 1975)

§ The MINISTER of STATE, SCOTTISH OFFICE (Lord Kirkhill)
My Lords, I beg to move that this Bill be now read a second time. I am glad to be able to bring before your Lordships' House a measure which proposes a most useful package of reforms in that area of the law of Scotland which relates to damages for injuries causing death. The provisions in the Bill derive directly from recommendations made by the Scottish 1580 Law Commission in their Report which was published in July 1973. That Report incorporated a draft Bill which forms the basis of the measure which is now before your Lordships. The form of the Bill as introduced differs in a number of ways from the Scottish Law Commission's original Bill but the changes are mainly of a presentational and drafting nature and have all been agreed by the Commission. I can, therefore, give a complete assurance to your Lordships that this Bill has the full backing of the Scottish Law Commission.
My Lords, I think it will be helpful if I trace briefly the history of the Bill. The Scottish Law Commission's consideration of the question of damages for injuries causing death started in 1965 when they were invited to consider the questions whether relatives should have a right to sue for solatium (that is, compensation for pain and suffering) and loss of support even when the deceased him self had initiated proceedings during his lifetime and whether the class of relatives entitled to sue for solatium and loss of support should be widened. When considering these questions, however, the Commission found that there were a number of related and wider questions which could not be omitted from con sideration if the law were to be dealt with in an orderly way. It was subsequently agreed by the Secretary of State for Scotland and the Lord Advocate that the Commission should undertake a comprehensive review of the whole question of the problems raised by actions of damages for injuries causing death. It is the fruits of this comprehensive review that come before your Lordships today in the shape of the Damages (Scotland) Bill. Before the publication of their final Report, the Scottish Law Commission sought reactions to their proposals in two memoranda they circulated for comment and criticism. The proposals in the second of these memoranda received widespread approval and the Bill is based, with minor modifications, on the scheme outlined in that memorandum. Reaction following the publication of the Scottish Law Commission's final Report has been entirely favourable.
I indicated earlier that the Bill deals with damages for injuries causing death and, in the main, that is what it does. In one respect, however, it goes rather 1581 further than that. The Scottish Law Commission found that to achieve one of their desired objectives—the avoidance of any duplication of damages in the sense that compensation for substantially the same loss should not be recoverable both by the deceased's executors and his dependants—they were obliged to consider an injured person's own claim for financial loss in respect of any reduction of his life expectancy resulting from an accident. As a result of this, the Bill contains a provision clarifying the law relating to the assessment of damages for this "lost period".
In their approach to their review, the Scottish Law Commission had a number of main objectives before them. I have already mentioned one of these, the avoidance of any duplication of damages. Among the others were the aims that compensation should be recoverable by a deceased's executors for financial loss suffered by the deceased in respect of the period up to his date of death that compensation should be recoverable by the deceased's dependants for financial loss suffered subsequent to his date of death; that compensation for loss of society and guidance should be recoverable only by the immediate relatives of a deceased: that the defender should not be exposed to the risk of a multiplicity of action; and that consistent with these principles, the system of compensation should be clear and simple and conducive to extra judicial settlement. These main objectives are all fully supported by Her Majesty's Government and have all been incorporated in the provisions of the Bill.
I come to the actual provisions in the Bill. Its broad purpose, as I have indicated, is to amend and improve existing Scots law in the field of damages for injuries causing death. All the proposals are important and together they form a comprehensive and coherent improvement in this area of the law. Perhaps, however, I should draw particular attention to certain aspects of the Bill. It sets out clearly the rights of both the dependants and the executors of a person who dies as a result of an injury and extends the class of dependants who are entitled to sue for loss of financial support to brothers, sisters, uncles and aunts and their children, to a divorced spouse and to step-children. It also provides that immediate relatives—that is, spouses, parents 1582 and children—are entitled to sue for a loss of society award which replaces, so far as it applies to those relatives, the existing award for pain and suffering, known as solatium. The loss of society award, the amount of which is to be left to the discretion of the court, is in respect of compensation for the loss of non-financial benefit which the relative might have expected to derive from the deceased's society and guidance had he not died. The rights of a deceased person to sue will transmit to his executors, but only in respect of the period up to his death and only in respect of financial loss, not solatium. The fact that a person who dies had raised an action in his lifetime which is pursued by his executors will not prevent his relatives from raising an action for financial loss. Relatives have, in fact, been prevented from doing this since 1892 following a decision of your Lordships' House in its appellate capacity, a decision which was reversed as recently as last month. Although the obstacle created by the 1892 decision has now been removed, it is proposed to retain the statutory provision recommended by the Scottish Law Commission.
As I indicated earlier, the Bill also clarifies the law on the assessment of damages where an injured person's expectation of life is diminished. Your Lord ships will be fascinated—but not, I hope relieved—to learn that the Bill also provides for the abolition of the ancient Scots common law right of assythment. This is the right by which the relatives of a person slain by a criminal act are able to obtain redress from the person responsible. The proposals in the Bill to extend the category of dependants entitled to sue effectively remove the need for any one to have recourse to the ancient remedy. Even as things stand at present, it is now virtually obsolete. There are other provisions in the Bill, but those I have referred to are, I think, are major ones and I hope that I have provided your Lordships with an adequate indication of the Bill's scope.

§ The Earl of MANSFIELD
My Lords, I apologise for not being in my place when the noble Lord, Lord Kirkhill, rose to speak. It is a matter of interest, if not 1583 astonishment, how quickly your Lord ships' business is conducted when the House commences at 11 a.m. I wish, first, to thank the noble Lord for the comprehensive, yet succinct, way in which he outlined the terms of the Bill. It is not, as I understand it, a contentious matter, although it is important for those who live in Scotland and it is very interesting to anybody who is interested in the development of the law, and particularly in the rights transmitted in cases of personal injury where death intervenes. Nevertheless, on a personal note I feel that I must tread warily because I am in no way qualified to pontificate on matters of Scottish law. I, too, was slightly sad to read of the abolition of the right of assythment because I understand that it had come to have a tortious connection, as well as the old right which was granted where there had been a criminal act something that was covered in the last century so far as we in England are concerned by Lord Campbell's Act, and he was a good Scot of course.
It seems that the Bill follows closely the draft which was contained in the Report of the Scottish Law Commission relating to damages for injuries causing death. It has, I understand, the support of most legal authorities in Scotland, including the Law Society of Scotland, so that any comment on the Bill must relate to the relief which is given to persons related to somebody who dies in these circumstances and, where damages may be claimed, to the classes of persons who are given such relief. Taking, first, the type of relief to be granted, Clause 2(4) has a new award called the loss of society award. The courts are to be given, by this Bill, quite deliberately, very little guidance as to how they are to set about their duties when assessing compensation under this head, and indeed the noble Lord, Lord Kirkhill, said as much, and certainly it was the intention of the Commission that little, in fact no, guidance should be given, for in paragraph 111 of the Report it is stated: We consider that it should be left to the courts to work out the appropriate compensation. It will not be easy in the absence of such guidance, at least until a good number of cases have been decided, for the courts to work out the measure of 1584 damages under what is, after all, an entirely new heading. Nor will it be easy for practitioners to advise their clients what they may expect to receive because they have been deprived, as it were, of the benefits of the deceased's society and guidance, whatever that may mean; nor—and here I suppose I must declare an interest—will it be easy for insurance companies to estimate their contingent liabilities. Equally—and now I am speaking more generally—the Bill is silent on the principles behind the Law Reform (Miscellaneous Provisions) Act 1971; that is, the prospects of remarriage to be taken into account, or, rather, not to be taken into account, in the case of the possible remarriage of the widow. One wonders how far the Government consider the extension of the principle of Section 4 of that Act should apply to children of the deceased or, indeed, to widowers. There has been a great deal of comment and speculation about Section 4 and my view, for what it is worth, is that it should not be so extended.
The only other matter on which I wish to comment—it may be said that these are Committee points; I do not think they are, but I doubt whether this Bill will have a Committee stage or at any rate a very extensive one—relates to Schedule 1, to the definition of "relative." This definition has two connections, in general and those who may obtain a loss of society award. It is right, and I congratulate the Government—if that is the right word to use—on the fact that children of the family are included in Schedule 1(1)(c). That is something which has not been in the English law for very long, and it is right that it should apply in Scotland also.
There has been some comment as to whether those persons described, rather coyly, in the Report as being "unmarried spouses"—in England I suppose they are common law wives and what I would describe as mistresses—should, as it were, be entitled to damages in these circum stances. Bearing in mind the difficulties—although I think it right to say that, in England, the law is beginning to take a much more benign view of such per sons than in the past—it is probably right that they should be excluded from the provisions of Schedule 1. Equally, I suppose that it could be said that there are other extremely worthy classes of relative 1585 who might well have been included in Schedule 1. I refer, for example, to "in-laws" who may have been kept or maintained by the deceased person. One must balance right and justice and what can be done against the very considerable difficulties that would arise if the class in paragraph 1 were made too wide.
All in all, one must congratulate the Government for being quick in putting into effect the Report of the Scottish Law Commission. I have no doubt that the Bill will go expeditiously through your Lordships' House.

§ Lord DRUMALBYN
My Lords, I should like to make two comments. First, I should like to congratulate those responsible on an admirably clear Report. I believe it is unusual for a complicated legal matter to be set out as clearly as has been done in this Report. I should like also to congratulate the noble Lord, Lord Kirkhill, on the clarity of his own speech in which he summarised so clearly and briefly the content of the Report.
My other point is, in a way, a side issue, but this is the stage of a Bill when one is free to introduce such an issue. Where beneficiaries, if that is the right word, receive compensation for loss of support—that is, where the deceased has been contributing or is likely to contribute to the support of those concerned—that money, presumably in the form of a capital sum, is invested. It seems anomalous that where compensation is given in this form, whereas the earnings in respect of which the compensation is calculated are subject to taxation as earnings, the money, once invested, will fall to be taxed as investment income and will therefore be taxed at a higher rate. I wonder whether the noble Lord could look at that point, though clearly I do not ask for an immediate reply and it is obviously outside the scope of the Report itself. However, I suggest to the noble Lord that this is a point which is worth looking at.

§ Lord KIRKHILL
My Lords, may I first of all thank the noble Earl, Lord Mansfield, for the general and generous welcome which he has given to this Government Bill. To deal with one or two of the points which he has raised, as regards assythment I feel that the only point which I should mention or 1586 re-emphasise is that the abolition was a direct recommendation—No. 27—in the Commission's Report. Of course the Government fully accept the tenor of the Report in each of its submissions.
As regards the loss of society award, the noble Earl mentioned as a possible insurance difficulty the fact that the courts have discretion to set the level of award. I should point out that the British Insurance Association has been consulted, and should also say that it is part of the Scottish court tradition that awards of this kind are left to the discretion of the court. On the other hand, there is a notional life expectancy. The lost period if, for example, the deceased were 49 would, I believe, be of about 20 years, because the notional life expectancy is about 69 years of age.
I am unable to comment about the provisions in Section 4 of the Miscellaneous Provisions Act 1971, but I shall certainly look into the point raised. All I can say about the definition of "relatives" in the Schedule is that the circle has to be squared at some point and that, while there are those who just fall outside the circle and those who are just included, it seems on balance to be just about right in its circumference. At least, that is the advice which I have received from the various bodies that have been consulted.
I am grateful to the noble Lord, Lord Drumalbyn, for his very kind personal remarks. He has my assurance that I shall look into the, as usual, interesting point which he has raised and that I shall communicate with him.