After a life changing injury, people often require a new home because their existing property can’t be adapted to meet their needs.
In personal injury and clinical negligence claims the injured person (the claimant) may be compensated for the purchase of a more expensive property, often single level accommodation that has room for the necessary modifications. For example, wheelchair access together with modified bathroom, kitchen facilities and a special room for carers. However, in such cases the claimant cannot be awarded the full capital cost of the property.
This is because the court will focus on the additional costs incurred to a claimant as a result of the negligence caused to the injured person.
The purpose of compensation is to put an injured person back in the position that they would have been in, if it was not for the injury, or as close as possible.
Claimants often received little or no compensation for new home costs
Until recently, to avoid overcompensation the claimant had to purchase the property and be compensated for the lost return on the capital that they invested in the new modified property (Roberts v Johnstone ). This has resulted in claimants often receiving significantly less than what they needed to make the new home purchase. Interim compensation payments, which we can achieve for clients, are often used to purchase a new home.
How is accommodation compensation calculated?
The way compensation is calculated for additional accommodation costs has recently changed. In October of last year (2020) the Court of Appeal in the case of Swift v Carpenter  altered the way compensation for accommodation costs will be calculated in the future.
In summary, the Court decided that accommodation claims should generally be valued at the additional capital cost minus the value of the reversionary interest based on a discount rate or investment rate of plus 5%.
Susan Liver, Partner and Clinical Negligence specialist solicitor with Birchall Blackburn Law, welcomed the decision in which the Court of Appeal backed the claimant to receive more than £800,000 in accommodation costs, after it was identified the claimant’s need for £900,000 to purchase a more expensive house.
The claimant lost her leg in a car accident seven years ago and was originally told she could not receive compensation to fund the capital costs of larger accommodation that she required. The outcome of the Court of Appeal judgement is that the claimant now recovered a significant sum rather than zero, which would have been the result under Roberts v Johnstone .
A home has a major impact on an injured person’s quality of life
Susan Liver says: “This is the correct decision allowing claimants to secure suitable accommodation to make their lives easier. Defendants often fight the accommodation costs vigorously because of the large sums involved. Over the years the method of calculation employed has resulted in a shortfall in the amount needed to buy a suitable property, so claimants have had to utilise monies from their other heads of damages to cover the cost of buying suitable accommodation.
“In brain injury claims accommodation is often needed to accommodate live-in carers or sleepers to supervise a claimant at night. Often a room is specially adapted for physiotherapy treatment to be given at home.
“It is not a perfect solution to the question of accommodation costs, especially in circumstances where the injured claimant has a shorter life expectancy. A seriously injury claimant in their 70s – rather than in their 40s – at the date of assessment would receive less overall compensation due to the fact they won’t have any future loss of earnings and the number of years of future care needed will be less.”
Injury compensation can be the difference between a house feeling like a home or a prison
Susan adds: “I’m acting for several claimants who are making a compensation head of damages claim for accommodation within their overall damages claim and this Court of Appeal judgement will clearly assist them. It’s good news and the right decision. Whoever you are, your home and facilities within has a major impact on your quality of life, even more so, if you are coping with a life-changing injury. It can be the difference between a house feeling like a home or a prison.”
If you wish to discuss a compensation claim for accommodation costs, a potential clinical negligence claim or any legal aspect to personal injury do not hesitate to contact Susan Liver on 01772 552278 or by email: firstname.lastname@example.org. Initial advise is free, confidential and with no obligations.