'Historic' structured settlement approved

The President of the High Court has warmly approved an “historic” Structured Settlement Agreement under which Irish Rail has agreed to make periodic payments to meet the costs of life-long care of a 40-year-old security guard who is severely brain-damaged after a 2.5 tonne steel gate collapsed on him.

The settlement, under which Irish Rail will also make monthly income payments to the injured man, is an interim one agreed in the expectation the government will introduce legislation to provide for such settlements, having set up a working group on the matter.

If such laws are not introduced, the court will determine the value of the case and make an award in that sum. The case has been adjourned to October 2011 for the purpose of the legislative issue being addressed. The man cannot be named as he is a ward of court.

Mr Justice Nicholas Kearns said the “imaginative, forward-looking and eminently sensible” settlement heralds a new development in how seriously injured plaintiffs in personal injury cases will be looked after in circumstances where issues such as life expectancy and future care costs were unclear.

He praised the “immense” work of Mr Justice John Quirke of the High Court, who chairs a Working Group set up by the government on structured settlements, and who had invited the parties to consider the desirability of a structured settlement. The efforts of the Working Group were aimed at making this form of litigation resolution more acceptable and such settlements were considered “extremely beneficial” in other jurisdictions, the judge noted.

Unlike other jurisdictions, there is no legislation here providing for structured settlements and one of the problems facing parties wishing to put such settlements in place is tax. As of now, income tax is payable on payments to injured plaintiffs under such settlements but it is hoped legislation to address that and other matters will be considered in a future Finance Bill.

Despite the difficulties, Irish Rail had said it was willing to enter into an interim arrangement pending the enactment of legislation and that led to today’s agreement, John Trainor SC, for the plaintiff outlined.

He was recommending the settlement which he regarded as beneficial both for his client and the company. There had been a dispute over his client’s life expectancy and there was a danger a lump sum award would not meet his lifetime care costs whereas a structured settlement would, counsel added.

Under the interim SSA, the company has said it will pay the €160,000 a year costs of the care of the man for his lifetime, pay him monthly income payments of some €1,200 for future loss of earnings to age 65, and cover his tax obligations at no cost to him. The payments will also be index-linked. He will also receive €250,000 general damages and special damages.