Record € 30m settlement for birth injury could trigger higher claims
The HSE’s agreement to a record â¬ 30 million settlement for a birth injury for a teenager with cerebral palsy is likely to trigger a demand for higher settlements and compensation for catastrophic plaintiffs.
Pending the planned introduction next year of regulations regarding the discount rates that should apply when assessing damages for future financial losses in such cases, the National Claims Agency may have difficulties in opposing such claims.
The case value of 14-year-old Oran Molloy at the current discount rate was estimated at 18-20 million euros, which his lawyers said would not meet his lifelong care needs.
His lawyer Gillian O’Connor, of law firm Michael Boylan, has asked for a â¬ 30 million settlement that would recognize interest rates are at abnormally low levels, which means lower returns on investments. She said that even though it was a lot of money, “the Molloys would return it in the blink of an eye” if what happened to Oran at birth “could be changed and the mistakes erased”.
De Birr, Co Offaly, Oran sued the HSE for alleged negligence in the circumstances of her birth at Portiuncula Hospital in Ballinasloe on December 31, 2006. Her mother was admitted the day before at 32 weeks gestation with an antepartum hemorrhage.
Oran was born by emergency cesarean section and required intensive resuscitation. He suffered from a lack of oxygen and was diagnosed with cerebral palsy. He cannot walk or stand without assistance, uses crutches and a wheelchair for long distances. He has normal cognitive function, attends school and his ambition is to become an electrical engineer.
Court documents on behalf of the HSE have pointed out that the Justice Department has decided, based on public consultation, that it is in the public interest to determine the discount rate in accordance with Section 24.1 of the 2004 Law on Civil Liability and the Courts. means the rate applied by the High Court to determine the present value of any future financial loss.
Section 24 provides for the Minister of Justice to make regulations prescribing the discount rate and for the court to apply a different rate if it considers that the rate prescribed by the Minister would cause an injustice.
The minister is expected to soon approve the convening of a panel of experts to determine the appropriate rate against these regulations, which would be reviewed regularly. The group is expected to be in place within six months and the minister could issue regulations in the first half of next year.
In the meantime, lawyers representing catastrophic plaintiffs are likely to seek settlements similar to those agreed in the Oran case.
The HSE admitted responsibility last month and then asked for the case to be adjourned for three to five years, essentially to see if interest rates improve.
After the President of the High Court, Madam Justice Mary Irvine, refused an adjournment as not being in the best interests of Oran, the settlement was reached after mediation.
Oran’s side said the â¬ 30m amount reflects a discount rate, or real rate of return of minus 1.5%, not the discount rate of up to plus 1 , 5% determined by the High Court in 2014, but this question was not accepted by the HSE.
His lawyers had previously told the HSE that they would be happy with a periodic payment order (PPO), allowing annual payments to meet his care needs over his lifetime, if that were tied to wage inflation. rather than price inflation. Because such a PPO was not available, they opted for a lump sum.