The Damages (Personal Injury) (England and Wales) Order 2024
On December 2, 2024, the Damages (Personal Injury) (England and Wales) Order 2024 (the “Order”) came into force, introducing significant changes to the way that damages are assessed in personal injury cases in England and Wales.
Purpose of the Order
The Order aims to modernize and streamline the process of assessing damages in personal injury cases. It seeks to ensure that victims of personal injury receive fair and reasonable compensation, while also reducing the burden and costs associated with litigation.
Key Changes
The Order introduces several key changes to the assessment of damages in personal injury cases, including:
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Judicial College Guidelines: The Order introduces a new set of judicial college guidelines that provide guidance on the assessment of damages in various categories of personal injury, including pain, suffering, and loss of amenity. These guidelines are intended to promote consistency and fairness in the assessment of damages.
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Structured Settlements: The Order expands the use of structured settlements, which are arrangements that provide for periodic payments of damages over a period of time. This can provide greater financial security for victims and mitigate the risk of lump-sum settlements being used up prematurely.
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Discount Rate: The Order lowers the Ogden discount rate from 2.5% to -0.75%. This means that lump-sum payments will typically be higher than under the previous rate.
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Caps on Damages: The Order introduces caps on damages for pain, suffering, and loss of amenity. These caps are set at £18,000 for children (up to the age of 18) and £100,000 for adults.
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Contributory Negligence: The Order clarifies the rules relating to contributory negligence. Victims who are partially responsible for their injuries may still recover damages, but their compensation will be reduced in proportion to their degree of fault.
Transitional Provisions
The Order contains transitional provisions that ensure a smooth transition to the new rules. Cases that were commenced before the Order came into force will generally be assessed under the previous rules.
Impact of the Order
The Order is expected to have a significant impact on personal injury litigation in England and Wales. It is likely to lead to higher lump-sum payments for victims, as well as increased use of structured settlements. The caps on damages are likely to reduce the overall amount of compensation awarded in some cases.
The changes introduced by the Order are designed to create a more efficient and equitable system for assessing damages in personal injury cases. It remains to be seen how this will work in practice and whether the Order achieves its intended goals.
The Damages (Personal Injury) (England and Wales) Order 2024
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