One of the aims of this blog is to highlight the various approaches that the courts take to claims for loss of earnings. In Tait -v- Gloucestershire Hospitals NHS Foundation Trust  EWHC 848(QB) HH Judge McKenna considered a claim for loss of earnings for a 34 year old self employed photographer.
The claimant was injured due to medical negligence. Liability was admitted. As a result of the negligence she suffered, inter alia problems with her bowels; bladder; difficulty with walking; numbness and pain.
- The judge based the assessment primarily on the assessment of the claimant’s evidence in relation to career prospects.
- In addition to a claim for loss of earnings there was a substantial award for the loss of chance to earn higher sums, adopting the approach in Langford – v – Hebran  EWCA Civ 361.
THE JUDGMENT ON CAREER PROGRESSION
The claimant worked as a photographer and the judge heard a considerable amount of evidence in relation to her abilities and likely earning potential.
How would the Claimant’s career have progressed and what would she have earned but for the injury caused by the negligently delayed surgery?
- The Court has heard a great deal of evidence from the Claimant herself and from a number of lay witnesses as to the Claimant’s work history, her character, drive and talent as a photographer and of her ambitions and motivation to make a success of a career as a photographer as well as from two employment experts. In addition the Court has had the opportunity of considering the Claimant’s portfolio of work and a number of editions of a magazine called “Family Time” of which the Claimant was a contributor.
- The Claimant’s aspirations as a photographer were to build up to earnings of at least £50,000 – £60,000 net. If she had to go back to working in the conferencing field she estimated that her earnings would be in the region of £40,000-£50,000. It was her evidence that if she were to have been unsuccessful in her photographic business that is what she would have done, or alternatively she would have gone into logistics or event management.
- It is common ground that the Claimant is a talented photographer and the lay evidence is littered with testimonials from various clients, all of whom speak of her talent and their willingness to recommend the Claimant to others. She plainly has energy, enthusiasm, drive, ambition and talent as well as being good with people and possesses acute customer service skills and has developed a good reputation. Moreover she had plainly done exceptionally well in her first full year of trading, particularly having regard to the family commitments and her health issues. Her personal tutor on the Masters Course at Birmingham City University, Mr Tromans, commented that the Claimant was different to other students because she already had a commercial practice and was already a competent photographer. She already had a client base and was attempting to broaden her horizons. She was efficient and competent and with a track record of delivering results which in was what clients wanted.
- Glen Taylor, who had over 30 years of experience of photography and videography, was very impressed with the Claimant’s work which he considered was exceptional, whilst Helen Roscoe, a freelance photographer, was particularly complimentary about the Claimant’s family photography which she described as being fantastic such that she had recommended her to a number of people for weddings and family portraits.
- Nicola Clement a Marketing Manager for a partnership called Elysia which is the UK Distributor of Dr Hauschka skin care products gave evidence to the effect that her organisation had used the Claimant for staff portraits and to take pictures of models at a Dr Hauschka casting session. She felt that the Claimant’s photographs were of commercial quality and impressive, that she had a great eye for a picture and also a way with people. She was good at catching people in photographs and making them look their best. She also had a commercial edge, lacking in other photographers. She felt that, had the Claimant continued working, her business would have continued to thrive, not only as a result of a steady stream of income from portrait work, but also as a result of her having developed relationships with magazines and having developed her reputation as a creative, yet commercially minded, photographer. She had no doubt but that the Claimant would have been successful. To my mind, and on the balance of probabilities, but for the negligently performed surgery the Claimant would have made a success of HTP.
- The lay witnesses also gave some evidence as to likely earnings so that, for example, Mr Taylor suggested figures of £350 – £450 per day and that an adequate photographer could probably earn between £45,000-£50,000 per annum gross although he has known other photographers that have earned substantial six figure sums . Miss Clement suggested a going rate of £400- £500 per day with a maximum for a local photographer of £600 per day whilst Miss Roscoe suggested that she was charging £1700 for two photographers for weddings and that if she was on her own she would charge £1200 per day with the going rate for weddings being between £1300 and £1800 with high end photography being over £2000 per day although she conceded that some photographers would charge less than £1000 although she wouldn’t put the Claimant in that bracket.
- It is plain from a consideration of the evidence of the respective employment experts that there is little solid evidence from external sources to assist the Court as to the Claimant’s likely income and her career prospects. Indeed the experts agree as such at paragraph 9 of their Joint Statement at 3/851 and 852. Ms Groves, for her part, identified an industry survey undertaken by the British Photographic Council whilst Mr Carter relied on the National Union of Journalists recommended minimum rates for photographers and a study conducted by the Association of Photographers. Both have commented on the lay evidence.
- Mr Carter came up with the following conclusions in his Report dated 27th September 2013 at 3/755:
|Summary of possible earnings||Summary of possible earnings||Summary of possible earnings|
|Year||Gross Profit||Net Profit*|
|2009/10||£27,926 – £29,281||£23,039 – £24,157|
|2010/11||£38,668-£41,378||£31,901 – £34,137|
|2011/12||£49,410 – £53,475||£40,763 – £44,117|
|2012/13||£60,152 – £65,572||£49,625 – £54,097|
|2013/14||£70,893 – £77,670||£58,487 – £64,078|
*Assuming 17.5% deduction for expenses.”
- In arriving at his conclusions, Mr Carter relies heavily on the evidence of the lay witnesses and the figures are, in my judgment, highly speculative.
- Ms Groves, in her Report dated 23rd December 2013 which begins at 3/762 at 3/775 under the heading “Summary and Conclusions” opines as follows:-
“34 Mrs Tait had begun a business as a photographer when in March sustained cauda equina syndrome as a result of a delay in treatment at an NHS hospital in July 2009.
35 Mrs Tait had very creative ideas and good contacts within the industry. She comes across as a person who was dedicated to her work and had high standards. She had potential to develop her business.
36 Her accounts show that in the year preceding the injury she had received a profit of £10,287 after costs. This equates to the median for surveyed female freelance photographers. She had undertaken some unpaid shoots to promote herself which is common in the industry due to the large number of would-be photographers.
37 In his report Mr Keith Carter has predicted rapid growth for the photographic business and earnings at the very highest end for photographers. He has not provided any comment on the statistical likelihood of achieving very high earnings or the number of hours work necessary to achieve this.
38 The physical strain of taking and editing photographs for long hours would need to be taken into account. This is a medical issue in regard to Mrs Tait’s pre-existing spinal problems.
39 Mrs Tait had two children at the time of the injury and she has had a third child this year. It would be necessary to take into account the need for reliable childcare arrangements for a person working long and unpredictable hours as a high earning photographer.
40 The following table shows the result of the British Photographic Council’s Industry Survey for Photographers 2010, relating to 1,698 photographers:
|Average mean freelance profit||£18,821|
|19% of freelancers||£30,000+|
|29% of freelancers||£1 – £10,000|
|Median turnover/profit female photographers||£25,000/£10,000|
|Median turnover/profit male photographers||£39,471/£15,000|
41 The majority of photographers earn modest incomes and many supplement this with alternative work. The extent to which Mrs Tait would have been able to succeed at the very top of the profession as indicated by Mr Carter will be a matter for the Court.”
- In my judgment, the extent to which the employment experts can assist the Court in this case is limited. Photography is plainly an uncertain profession and earnings are erratic and often modest as is apparent from the British Photographic Council’s Industry Survey for Photographers 2010. True it is that the Claimant has real talent but there are many talented photographers and the industry is very competitive. On the other hand, the Claimant had clearly made a very good start to her photographic career as is apparent from the figures to which I have already referred and I remind myself of the Claimant’s contribution to the early success of CCP in terms of increased turnover and income as further evidence of the Claimant’s competence and her successful track record. It is also fair to record, as counsel for the Claimant submits, that the agreed residual earning capacity is at a level higher than the average annual female income recorded in Ms Grove’s survey. I have also taken into account the evidence from the various lay witnesses as to possible future earnings and their consistent evidence as to the Claimant’s talent, ability and commitment.
- However, taking all matters into account and doing the best I can, I conclude that the figure contended for by the Claimant is extremely optimistic whilst that contended for by the Defendant is in all probability unduly pessimistic.
- I am urged by counsel for the Claimant to adopt a broad brush approach to the question of the calculation of future loss of income and to fix a net overall figure. I accept the thrust of that submission as to the appropriate approach in the circumstances of this case.
- It is common ground that the Claimant would have income from three sources, CCP salary, CCP dividend and HTP. For the purposes of the calculation of past and future loss of earnings, the parties have agreed a common approach to CCP salary and CCP dividend but in broad terms where they are at odds is as to the appropriate figure for earnings from HTP.
- To my mind, having regard to the totality of the evidence and bearing in mind the many and varied imponderables, I conclude that an appropriate net overall annual figure is £45,000 i.e. inclusive of CCP salary and dividend but net of child care.
- I turn now to a consideration of the various heads of loss by reference to the very helpful attachments to counsel for the Claimant’s written closing submissions and trust that counsel will be able to incorporate the following figures into the various attachments to arrive at the total figure for special damages
Past Loss of Earnings – (Attachment One)
- As it seems to me, in order to calculate past loss of earnings, the Court should adopt a straight line progression of the income of HTP from the figure of £10,287 in the year 2008/9 to £29,535 (net of child minding fees) by the date of trial. (£45,000 minus CPP salary and dividend).
Future Loss of Earnings
- I have already dealt with the question of future earnings generally.
- There is an issue between the parties as to the Claimant’s likely retirement date with the competing submissions being 68 on behalf of the Claimant and 65 for the Defendant. The former being the official government retirement date and there appearing to me to be no good reason to depart from that date, I conclude that the appropriate date for calculation of loss is 68.
- There remains however the claim for loss of a chance of higher earnings claimed in the sum of £164,876.20, adopting a calculation used in Langford – v – Hebran  EWCA Civ 361. In that case, the trial judge awarded damages for future loss of earnings based on basic income plus the lost chance of higher earnings calculated by reference to the percentage chance of attaining the higher level of success. The Claimant claims for a 50% chance adopting the mid point of the gross figure set out in Mr Carter’s report with appropriate deductions for childminding and tax. In principle this approach seems to me to be appropriate save that it does not seem appropriate to include in this calculation any sum in respect of CCP salary or dividend since, in order to have any prospect of earning the higher photographic earnings figure, the Claimant would have had to devote the whole of her time and effort to that aspect of the business. I would therefore award such sum as is calculated using the methodology set out in the Schedule of Loss save for the exclusion of CCP salary and dividend. Adopting that methodology, the relevant figure for highest achievable net annual income excluding CCP salary as set out in the Schedule of Loss is just under £85,000 which the Claimant has adjusted downwards in submissions to £72,080. Adopting a multiplier to age 68 of 19.3, the relevant figure, before deduction of the base level of future net income, is £1,391,260 and net of that base level is therefore £522,760. Given that what is being considered is, as I have found, a 50% loss of a chance of earning that level of income the relevant figure under this head of loss is £261,380