In a recent High Court hearing in the matter of Mrs LP (a protected party by her litigation friend and husband MP) v Wye Valley NHS Trust [2018] EWHC 3039 (QB) the Court reviewed the principles upon which an interim payment on account of damages in a personal injury claim can be made. Interim payments can be advanced in cases where a trial is someway off and liability has been admitted by the defendants so that the claimant has funds in advance without having to wait for the final hearing.

The Court rules (CPR Part 25) provide that “the Court must not order an interim payment of more than a reasonable proportion of the likely amount of the final judgment“. The principles to be applied in determining the level of interim payment are set out in the Court of Appeal judgment in the case of Eeles v Cobham (2009) EWCA Civ 206. The Court must assess the likely amount of the final judgment leaving out of account those heads of future loss the trial Judge might wish to deal with by way of an order for periodical payments (PPO). The heads of loss commonly considered include general damages for pain, suffering and loss of amenity and special damages in respect of past losses and interest. The assessment should be carried out on a conservative basest but once that has been done a reasonable proportion may well be a high proportion.

Where an interim payment required exceeds a reasonable proportion of the likely amount assessed on the conservative basis then the Court can have regard to the second stage which can include an assessment of the capitalised amount of future losses but only where it can be confidently said that the trial Judge would wish to award a larger capital sum and only where the Court can be satisfied that there is a real need for the payment requested.

In Mrs LP’s case she was seeking an interim payment £400,000 the purpose of which was to fund future care and enable the purchase and adaptation of a suitable single story property. The defendant had previously made a voluntary interim payment of £100,000 and was prepared to make a further voluntary payment of £100,000 but resisted the application for £400,000.

For the purposes of the interim payment the Judge reviewed the evidence in respect of the injuries and losses. General damages for pain suffering and loss of amenity were likely to be in the region of £150,000, interest is an additional £4,500, special damages and past losses were £189,500 and the claimed adaptation and accommodation costs were a further £180,000. This gives a total of £524,000. The parties had agreed a 5% reduction compromise on liability which when applied to the Judges calculations reduces the estimate of the likely award to just under £500,000. In the circumstances the Judge ordered a further interim payment of £350,000 which together with the sum of £100,000 already paid would amount to just under 90% of the Judges conservative estimate of the likely damages that will be awarded at trial and amounted to no more than a reasonable proportion of the likely amount of the final Judgment.