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Calculating damages in personal injury cases

Three cases of severe personal injury, where negligence was admitted, went to the House of Lords on appeal. The purpose of the appeals was to ascertain the correct method of calculating damages for the loss of future earnings and the cost of future care.

It was not in dispute that the aim of the court was to obtain a lump sum figure that represented, as nearly as possible, full compensation for the injury suffered, ie to place the injured party in the same financial position that they would have been in had they not suffered the injury.

The courts have traditionally dealt with this matter by using the 'annuity' approach - they work out how much the injured party needs per year for a ...

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