- · Bill empowers courts to make award of damages in cases of
- catastrophic injury by way of periodic payments orders.
- · “This is important new legislation which will give much-needed
- financial security to persons who have been catastrophically injured
- and who require lifelong care and assistance.” – Tánaiste
The Tánaiste and Minister for Justice and Equality, Frances Fitzgerald
T.D., has today published the Civil Liability (Amendment) Bill 2017.
The Tánaiste said: “I am pleased to announce the publication of the Civil
Liability (Amendment) Bill 2017 which will empower the courts to make
awards of damages in cases of catastrophic injury by way of periodic
payments orders.
The Bill addresses the concerns that have been raised by the courts where
the absence of a statutory alternative to lump sum payments has meant that
the best option for a catastrophically injured person in the form of a
periodic payments order was not available.
I am confident that the new measures can support catastrophically injured
persons without imposing undue liabilities on insurance companies or other
defendants.”
The Civil Liability (Amendment) Bill 2017:
· gives the courts power to award damages by way of periodic payments
orders (PPOs);
· sets out principles regarding the security of payments of PPOs;
· provides that PPOs shall be subject to annual indexation;
· amends the Insurance Act 1964 to provide that the limits on payments
from the Insurance Compensation Fund where an insurance company
becomes insolvent will not apply to PPOs;
· amends the Bankruptcy Act 1988 to protect a claimant’s periodic
payment award in the event of bankruptcy;
· amends the Taxes Consolidation Act 1997 to provide an exemption from
income tax in respect of payments made to persons under a PPO; and
· amends the Civil Liability and Courts Act 2004 to provide for formal
offers of settlement and costs in personal injuries actions involving
PPOs.
The Tánaiste concluded: “This is important new legislation which will give
much-needed financial security to persons who have been catastrophically
injured and who require lifelong care and assistance. I hope that the Bill
will be enacted as early as possible in 2017.”
The Civil Liability (Amendment) Bill 2017 is available at -
http://www.justice.ie/en/JELR/Pages/Civil_Liability_(Amendment)_Bill_2017
Note for Editors:
The purpose of the Civil Liability (Amendment) Bill 2017 is to empower the
courts, as an alternative to lump sum awards of damages, to make periodic
payments orders (PPOs) in cases of catastrophic injury where long term
permanent care would be required.
The measures in the Bill stem from the recommendations of the report of the
High Court Working Group on Medical Negligence and Periodic Payments
(2011), chaired by Justice John Quirke. The Department of Justice and
Equality undertook an intensive policy analysis and consultation process
with the Department of Finance, the Department of Public Expenditure and
Reform, the Department of Jobs, Enterprise and Innovation, the Department
of Health, the Office of the Attorney General and the State Claims Agency
in the development of the Bill. Representatives of the insurance sector and
of the Personal Injuries Assessment Board were also consulted.
The main provisions of the Bill are as follows:
Insertion of new Part in Civil Liability Act 1961
Section 2 of the Bill will insert a new Part IVB (sections 51H to 51O) into
the Civil Liability Act 1961 to make provision for periodic payments orders
(PPOs) in catastrophic injury cases.
Section 51H defines “catastrophic injury” as meaning “a personal injury
which is of such severity that it results in a permanent disability
requiring the person to receive life-long care and assistance in all
activities of daily living or a substantial part thereof”. The section also
provides a definition of “activities of daily living” as including
activities such as dressing, eating, walking, washing and bathing.
Section 51I is the central provision in the new Part IVB. It provides that
where a court is awarding damages to a catastrophically injured person, it
may order that all or part of the damages for future medical treatment,
future care of the plaintiff and the provision of assistive technology be
paid by way of a periodic payments order. In addition, where all parties
are in agreement, damages in respect of future loss of earnings may be paid
by PPO.
In deciding whether to make a periodic payments order, the court must have
regard to the best interests of the plaintiff. The court must also take
account of the circumstances of the case, including the nature of the
injuries suffered by the plaintiff and the preferences of all the parties
regarding the form of award which would best meet the needs of the
plaintiff.
A court may order that a PPO will increase or decrease from a specified
date by a specified amount (a “stepped payment”) to cater for anticipated
changes in the plaintiff’s needs, such as entry into primary, secondary or
third level education, reaching the age of 18 years or changes to the care
needs of the person including transfer to residential care.
Section 51J provides that a court may only make a PPO where it is satisfied
that the continuity of payments under the PPO are reasonably secure.
Section 51K provides that a paying party must make an application to the
court where it proposes to alter the method of payment of a PPO.
Section 51L deals with the issue of indexation of payments. It provides for
the adjustment on an annual basis of a payment under a PPO in line with the
prevailing rate under the Harmonised Index of Consumer Prices. The section
provides for a review of the application of the index after a 5-year period
and, if necessary, for the specification of a more suitable alternative
index by Ministerial regulations.
Section 51M provides that a PPO may not be assigned, commuted or charged
without the approval of the court.
Amendment of Insurance Act 1964
Section 3 of the Bill amends section 3 of the Insurance Act 1964 to provide
that the limit on the amount that may be paid from the Insurance
Compensation Fund will not apply in cases where the court has made a
periodic payments order. Consequently, where an insurance company became
insolvent, the full amount due to a PPO plaintiff would be paid in full
from the Insurance Compensation Fund.
Amendment of Bankruptcy Act 1988
Section 4 of the Bill amends the Bankruptcy Act 1988 to ensure that a
claimant’s periodic payment order will be protected in the event of
bankruptcy so that he or she will continue to receive the resources needed
to cover necessary long-term care and medical attention and that such
resources will not be available for distribution to creditors.
Amendment of Taxes Consolidation Act 1997
Section 5 of the Bill amends the Taxes Consolidation Act 1997 to provide an
exemption from income tax in respect of payments made to persons under a
periodic payment order. PPOs will have the same tax exempt status as exists
for lump sum payments for damages.
Amendment of Civil Liability and Courts Act 2004
Section 6 of the Bill amends section 17 of the Civil Liability and Courts
Act 2004, which deals with formal offers of settlement and costs in
personal injuries actions, to make provision for cases involving PPOs.