In a judgment dated 20th July 2020 (Ref. App. Ċiv. 282/19) the Court of Appeal confirmed an earlier judgment of the First Hall of the Civil Court, awarding damages to the family of an 84-year-old lady who died when her home collapsed on her.
1. The facts
A house collapsed, killing the occupant, after the house, next door was demolished and other excavations occurred. Action was instituted against the owners, their architect, the contractor in his personal capacity as well as director of a particular company, and the sub-contractor who actually carried out the rock excavation and earth clearance.
2. The pleas
Raised by the defence the owners pleaded that they engaged people with the requisite skills; their architect blamed the contractor for disregarding his instructons, the contractor denied any personal resposnibility and as director of the company which signed the contract of works he claimed that the work was done according with the requisite skills, the sub-contractor submitted that he only followed the perit’s instructions.
3. The court expert’s findings
The court expert found that as a direct result of excavations, a dividing wall was exposed and had to serve as a retaining wall, when it was not built for such a purpose leading to the collapse of the building. The same expert found that the excavations went deeper than what was required and beyond what was instructed by the architect. It also resulted in that on the day prior to the collapse of the house the architect had warned those involved in the excavation of the danger and instructed remedial work to shore up the property, which instructions were disregarded.
4. The court’s findings
The Perit failed to go on site to ensure that his instructions for remedial work were actuallly carried out; on the other hand the contractor as sole director was not allowed to hide behind his company when he was the main activist in the business and was also the person who decided to excavate closer than 76cm from the dividing wall and to continue excavating as much as he thought necessary without seeking the advice of the Perit. The sub-contractor although obeying the contractor’s instructions carried out the actual work. For this reason, all were found liable for material (non-punitive) damages which damages were calculated according to the Butler v Heard formula.
This is the second part of an article concerning a judgment delivered by the Maltese courts (Ref. App. Ċiv. 282/19), involving a property which collapsed as a direct result of works undertaken next door. The octogenerian living in it, was killed. Having described the case, I will concentrate on a particular point of interest.
This point being discussed concerns the fact that defendants were ordered to pay damages to the heirs of the octogenerain who died as a result of the collapse. The amount of damage to be paid was calculated according to the Bulter v Heard method, initially laid down in Michael Butler v. Peter Christopher Heard (Court of Appeal, 22nd December 1967). Butler v. Heard was lodged by an individual who suffered a serious disability when only twenty-two years old, as a result of a traffic collision. The victim, Mr Butler, was awarded damages in two forms, the first being actual damages suffered as a direct consequence of the accident (damnum emergens), the second being compensation for loss of future earnings as a result of the disability suffered (lucrum cessans). The novelty lay in the award of loss of future earnings (lucrum cessans). The Court established Mr Butler’s average periodical earnings and estimated by how much these had been reduced as a result of the disability incurred. The Court also considered the expected remaining working life of the victim considering his age, state of health and any other circmstances deemed relevant including the ‘chances and changes in life’ (‘the multiplier’). The fact that the victim was being paid a lump sum was also given consideration. Also, the Court considered that Mr Butler had suffered a 45% disability, keeping in mind the progress of the victim’s recovery: by the time judgment was delivered, Mr Butler could walk with the aid of a stick and could stay on his feet for as long as two hours without needeing to rest. The Court also considered the victim’s testimony that if he had enough money he would set up his own business and take on employees: the Court deemed that such employees would serve to help Mr Butler overcome his physical shortcomings. A multiplier of fifteen was adopted and the sum calculated was reduced to take into account the fact that it was being paid as a lump sum, which meant that the victim could easily put the money in the bank and earn interest.
The reader might be disappointed, perhaps even shocked, that a multiplier of only fifteen was used, given that the victim was twenty-two years old at the time of the accident. Did the court seriously believe that the average person would not work beyond the age of thirty-seven? Furthermore, reducing the award simply because it was paid as a lump sum and therefore could be invested comes across as unfair: the Court gave no consideration to the fact that any amount of money awarded in 1967 would devalue in time way beyond any interest earned putting the money in the
On the other hand, despite the shortcomings, the Butler v. Heard formula is indeed an example of positive judicial innovation, and made a great difference from the pre-Butler v. Heard situation where only actual, material damages used to be awarded. One has to also consider the context of this judgment: the judiciary were breaking new ground, so it was perhaps natural for them to be a bit cautious in the actual award. In later years and subsequent judgments the courts did indeed become more generous in their calculations, to the benefit of the victims of such accidents. However, it stands to reason that the older the victim, the more cheaply the perpetrator of the accident is let off. In fact, the court in the case under discussion concerning the eighty-four year old lady who died when her home colapsed, only awarded €10,800, because of the victim’s age (a multiplier of four was adopted), and was living on an old persons’ pension (estimated at €600 per month). The Court itself was aware that this amount was low considering that a person was killed, but justified it on the basis that damages were neither punitive in nature, nor intended to reflect in monetary terms the value of human life.
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Dr Ivan Mifsud is an Advocate by profession and the Dean of the Faculty of Laws, University of Malta.