From: Wright, Richard <Rwright@kentlaw.edu>
To: haroldjen@netspace.net.au
TETTENBORN A.M. <A.M.Tettenborn@swansea.ac.uk>
Obligations list <obligations@uwo.ca>
Date: 06/08/2010 23:54:12 UTC
Subject: [Spam?] RE: Re: Private hospitals -- direct claim from a wrongdoer?
Hi Harold and Andrew and all-
 
An interesting situation.  (As an aside, I assume that Andrew meant to say "the risk of [legal] costs is borne by the [tort victim] or his estate".)
 
I agree with Harold that Drake is right to say that it is hard to see a distinction between the benevolent charity and the benevolent relative, which Diamond purports to make.  In either case, the benefit of the services was conferred "independently of any right of redress [the victim] might have against others" and with no expectation of compensation from the victim.  If anything, the charity in Diamond seems to have had more of an expectation of compensation by/through the plaintiff, through subrogation to the plaintiff's rights against the tortfeasor, based on the invoices it sent to the tortfeasor "to be paid if she successfully received damages" from the tortfeasor, and also more of a reason to have/hope for such subrogation given its costs and related undraising needs.
 
I also don't understand the Diamond court's assertion that, merely because the Spastic Centre did not intend any payment to be made to it (directly!) by the tort victim, "it is not possible to say (as [the trial court] found) that the Spastic Centre did not intend the market cost of its services to reduce the [tort victim's] ordinary entitlement to damages."  There is no logical connection between the two issues, even if the common law collateral source rule has been abolished (has it been abolished in NSW?).  If it has been abolished, even with respect to gratuitous benefits provided to tort victims (which is an extreme form of abolishment not usually adopted even in the"'tort reformed" United States), then the tort victim's receipt of the benefits from the Spastic Centre did (unjustly) reduce the victim's claim against the tortfeasor, whether or not the Spastic Centre intended that result.  If it has not been abolished, then the victim's claim against the tortfeasor is not reduced, again regardless of the Spastic Centre's intent on that issue.
 
That leaves the real issue: whether the gratuitous benefactor (but recall that the Spastic Centre was only being gratuitous with respect to the tort victim, not the torfeasor) should be precluded from recovering, with (or maybe even without) the cooperation of the tort victim, the costs it incurred that otherwise would have had to be paid by the tortfeasor.  Like Harold, I vote for the Spastic Centre. 
 
- Richard

From: Harold Luntz [mailto:haroldjen@netspace.net.au]
Sent: Fri 8/6/2010 9:07 AM
To: TETTENBORN A.M.; Obligations list
Subject: ODG: Re: Private hospitals -- direct claim from a wrongdoer?

Andrew,

Although a claim by a living plaintiff, not an estate, there is a decision, Diamond v Simpson (No 1) [2003] NSWCA 67 (7 April 2003); (2003) Aust Torts Reps 81-695, which goes against this claim. The relevant part of the headnote reads:

In relation to the provision of medical and allied professional services to the first respondent from the Spastic Centre for New South Wales (for which the Spastic Centre subsequently sent invoices to the first respondent to be paid if she successfully received damages), Whealy J allowed a sum of $614,752. His Honour held that the appellant was required to pay damages, on a Griffiths v Kerkemeyer [1977] HCA 45; (1977) 139 CLR 161 basis, to the first respondent based on the Spastic Centre's charges (albeit that the first respondent had no legal obligation to pay the Spastic Centre). In doing so, his Honour extended the Griffiths v Kerkemeyer doctrine to therapeutic services provided free of charge by a charitable organisation.

The Court of Appeal held that the trial judge erred in so extending the Griffiths v Kerkemeyer doctrine. Griffiths v Kerkeymeyer claims are anomalous and exceptional and courts should be reluctant to extend the doctrine to new categories of claims. Claims for gratuitous services rendered by a friend or relative fall into a separate, identifiable category of claims, that can properly be described as Griffiths v Kerkemeyer claims. Claims for gratuitous services rendered by a publicly or privately funded charitable institution are not payable by the wrongdoer merely on the ground that the injured person has established a need for the services in question. The injured person's entitlement to such claims will depend upon an application of the principles expressed in National Insurance Company of New Zealand Limited v Espagne [1961] HCA 15; (1961) 105 CLR 569.

In the opinion of the Court of Appeal, the benefit of the services received from the Spastic Centre was conferred on the first respondent independently of any right of redress she might have against others. Accordingly, on the Espagne approach, the services provided by the Spastic Centre constitute subventions given out of benevolence with the intention that no payment was to be made for them by the first respondent. Thus, it is not possible to say (as Whealy J found) that the Spastic Centre did not intend the market costs of its services to reduce the first respondent's ordinary entitlement to damages. Thus, the Court of Appeal set aside the awards made in respect of the Spastic Centre.

I've never liked this decision and I think Drake preferable. (The judge says there is no authority on the point, but he obviously didn't look to Australia.)

Regards,
Harold.

On 6/08/2010 11:07 PM, TETTENBORN A.M. wrote:

In English law, can a charitable hospital that provides free care to an injured person claim from the tortfeasor who injured him? Of course not ... except that apparently it now can, at least if the injured person or his estate is prepared to play ball.

In Drake v Starkey [2010] EWHC 2004 (QB), a nice case decided yesterday, an asbestosis victim lived out his last month at a hospice. The care was free, though victims and their estates often felt obliged to make a gift after the event. After the death the estate came in, wearing the decedent's hat under the 1934 Act, said it felt like making a donation representing a reasonable charge for the therapy received (a not inconsiderable £10,000 for a month), and asked the tortfeasor to cough up. Held: the estate wins. There's no difference between care given by a kind relative and a kind charity: if the former can claim, so can the latter. There is, of course, the usual Hunt v Severs trust: but even that is now a pretty empty shell, since under the new court rules the payment goes direct to the carer, with a court-directed receipt to the nominal plaintiff.

In short, it seems to me, a direct tort claim in all but name. Indeed, arguably even better, since the risk of costs is borne by the tortfeasor or his estate, and not by the party that stands to get the loot. Nice work if you can get it?

Best wishes to all

Andrew