On 1 May 2024, Clyde & Co PPO Unit welcomed James Todd KC of 39 Essex Chambers to discuss the issues of double recovery and statutory funding. The webinar, attended by over 100 colleagues and clients, proved to be an interesting discussion between James, Andy Hibbert, Heather Dale and Kate Mikolajewski.

The potential for double recovery in this context was identified in Hodgson v Trapp (1989) and defined as “where the statutory benefit and the special damages claimed for the cost of care are designed to meet the identical expenses”. 

It is clear from subsequent case law that the court regards it as a matter of principle that double recovery should be avoided. Indeed, HHJ Robinson in WNA v NDP (2023) stated that not only did the authorities show the court should be alert to the prospect, but that it “should actively intervene to prevent it.”

The webinar provided a forum to discuss if, when and how, as insurers/representatives of the defendants in such claims, action should be taken where the claimant stands to make a double recovery by applying for statutory funding in addition to the damages they are awarded at the conclusion of their personal injury claim.

In many cases, it may be appropriate for the defendant or its insurer to not pursue this issue. There will however be claims where double recovery will have a significant impact and therefore the parties will need to come to an agreement as to how this will be avoided, or seek judgment from the court on the issue. In broad terms, in this situation, the parties may consider a reduction in the damages award to reflect future receipts of statutory funding, or, in the alternative, some form of reverse indemnity/Peters’ undertaking/Peters’ promise.

The mechanism by which the statutory funding is provided, ie whether it is for healthcare needs funded by the NHS under NHS Act 2006, or social care needs met by the Local Authority under the Care Act 2014, needs to be taken into account as this may impact the potential solution to the issue. 

Parties should be alive to the issue of double recovery from the outset of claims, obtaining relevant disclosure and engaging in dialogue with the claimant’s team at the earliest appropriate time where the decision is taken that double recovery may be a feature of the claim. 

It is an area of developing law, with new solutions being presented in preference to the older reverse indemnities that have been approved by the court in settlements since the case of Peters.

Consideration must be given to the practical realities of solutions proffered: will the parties be able to give effect to the provisions, and, if so, at what cost. 

Clyde & Co’s PPO Unit will continue to monitor and provide updates on the developments around these issues. 

The Clyde & Co PPO Unit

Clyde & Co has a dedicated team of lawyers who work together as part of our PPO Unit. Services offered by the team include the identification, assessment and settlement of claims via PPO; administration of PPOs on behalf of insurers, advice on and administration of reverse indemnity provisions and identification of PPOs where consideration of capitalisation may be appropriate. Please contact PPO@clydeco.com for further information about the services offered.