Cerebral palsy claim - lump sum or periodical payment?
When clients are successful in establishing that profound injury results from mistakes made by others, compensation can either be taken as a lump sum or as periodic payments for life or a mixture of both depending on the preference of the claimant.
Periodical payments are advantageous for claimants who have an uncertain life expectation, as they know that the compensation will continue to be paid throughout their life, especially where survival exceeds previous expectation.
However, a major problem with periodical payments is that they are upgraded every year according to rises in the retail prices index, but most disability needs are not related to this, rather to the earnings index.
A case heard in the High Court in November 2006 established for the first time that the court had the power to award future periodical payments linked to rises in earnings rather than purely prices. This is a major advance as it now means that claimants, especially those with longer life expectations including many people with medical negligence caused cerebral palsy, can have the safety and assurance of accepting compensation in this form.
The case is likely to be appealed by the NHS Litigation Authority so the current position might not be the final word on this issue.
Consistent with our policy when giving comment and advice on a
non-specific basis, we cannot assume legal responsibility for the
accuracy of any particular statement. In the case of specific problems
we recommend that professional advice be sought.
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