Claiming for loss of earnings following accident
Discussion
Hi all
A friend (yes, really) had a nasty non fault accident last year. Had to be cut out of car etc. she is self employed and missed an amount of time dependent work due to recovery (that could not be rescheduled).
The solicitors who her insurers instructed to deal with the claim are saying they can only seek to recover the amount of lost work less expenses (based on percentage of turnover claimed as expenses averaged over last three years) and less tax.
This basically reduces the amount by two thirds.
I am a named advocate for her to deal with this firm and am pushing for the full amount to be sought from the third party, less the actual expenses that would have been incurred with the work (mileage) and less tax. Logic being that the average of the last three years expenses are not actually relevant, as expenses in her line of work can vary massively depending on the work in question.
The firm are not keen on this, citing “court guidance”, “experience” etc
Any thoughts on whether I’m right be pursuing this?
Thanks
A friend (yes, really) had a nasty non fault accident last year. Had to be cut out of car etc. she is self employed and missed an amount of time dependent work due to recovery (that could not be rescheduled).
The solicitors who her insurers instructed to deal with the claim are saying they can only seek to recover the amount of lost work less expenses (based on percentage of turnover claimed as expenses averaged over last three years) and less tax.
This basically reduces the amount by two thirds.
I am a named advocate for her to deal with this firm and am pushing for the full amount to be sought from the third party, less the actual expenses that would have been incurred with the work (mileage) and less tax. Logic being that the average of the last three years expenses are not actually relevant, as expenses in her line of work can vary massively depending on the work in question.
The firm are not keen on this, citing “court guidance”, “experience” etc
Any thoughts on whether I’m right be pursuing this?
Thanks
Jeremy-75qq8 said:
I would say if you can prove your position you will be fine.
It is about an accurate assessment of loss.
The average over 3 years will be considered accurate by the court in the absence of other info
ThanksIt is about an accurate assessment of loss.
The average over 3 years will be considered accurate by the court in the absence of other info
She has letters from her contractor (which happens to be me) stating the work lost (location and fee).
She has told them the mileage that would have been incurred.
The guy on the phone this morning was saying to not use three years of tax returns would be fraudulent! And he told her last week if she did not sign the document agreeing to their figure me that she would be in contempt of court! All utter nonsense obviously. All very stressful for her.
Any recovery has to put her in a position she would have been in but for the accident.
To do a pro rata expenses calculation may leave her worse off and therefore is not the correct approach. If she can estimate her expenses for the lost jobs then that’s very useful.
Ultimately any recovery has to be the same net figure she would have got had the accident not occurred. I appreciate this is never an easy task as a self employed individual, however, you can get pretty close.
Hope this helps (run a PI law firm)
To do a pro rata expenses calculation may leave her worse off and therefore is not the correct approach. If she can estimate her expenses for the lost jobs then that’s very useful.
Ultimately any recovery has to be the same net figure she would have got had the accident not occurred. I appreciate this is never an easy task as a self employed individual, however, you can get pretty close.
Hope this helps (run a PI law firm)
chazd said:
Any recovery has to put her in a position she would have been in but for the accident.
To do a pro rata expenses calculation may leave her worse off and therefore is not the correct approach. If she can estimate her expenses for the lost jobs then that’s very useful.
Ultimately any recovery has to be the same net figure she would have got had the accident not occurred. I appreciate this is never an easy task as a self employed individual, however, you can get pretty close.
Hope this helps (run a PI law firm)
Many thanks. That’s what I was thinking, but good to hear it from someone in the industry To do a pro rata expenses calculation may leave her worse off and therefore is not the correct approach. If she can estimate her expenses for the lost jobs then that’s very useful.
Ultimately any recovery has to be the same net figure she would have got had the accident not occurred. I appreciate this is never an easy task as a self employed individual, however, you can get pretty close.
Hope this helps (run a PI law firm)
CCCS said:
Isn’t she best advised to push for a gross amount less expenses so that she can manage her affairs as tax efficiently as possible. For example in previous years she may not have contributed to a pension whereas this year she might have wanted to.
No pensions. Previous years student loan deductions were made as part of the tax payment, which the solicitor was trying to deduct from the payout as well, which is clearly wrong. SydneyBridge said:
Previous accounts should show how much profit has been made, that is what the claim is for essentially. Is she back to normal now?
Previous returns only show tax in previous years. This relates to a 8 week period ish of missed work.Sadly not. Still having physio. Also medical investigations that may require an op. And not back to herself mentally either
The defendant's insurers should be asked to arrange a psychological ssessment and counselling
Looks like she is long way away from any settlement, need to look at future loss of earnings and loss of opportunity, especially if she is fairly young. That may be the biggest part of the claim.
May be worth getting a Barrister involved for advice (and help drafting the schedule of loss) if the overall claim looks fairly high
Looks like she is long way away from any settlement, need to look at future loss of earnings and loss of opportunity, especially if she is fairly young. That may be the biggest part of the claim.
May be worth getting a Barrister involved for advice (and help drafting the schedule of loss) if the overall claim looks fairly high
SydneyBridge said:
The defendant's insurers should be asked to arrange a psychological ssessment and counselling
Looks like she is long way away from any settlement, need to look at future loss of earnings and loss of opportunity, especially if she is fairly young. That may be the biggest part of the claim.
May be worth getting a Barrister involved for advice (and help drafting the schedule of loss) if the overall claim looks fairly high
That’s very helpful, thanks Looks like she is long way away from any settlement, need to look at future loss of earnings and loss of opportunity, especially if she is fairly young. That may be the biggest part of the claim.
May be worth getting a Barrister involved for advice (and help drafting the schedule of loss) if the overall claim looks fairly high
elise2000 said:
SydneyBridge said:
Previous accounts should show how much profit has been made, that is what the claim is for essentially. Is she back to normal now?
Previous returns only show tax in previous years. This relates to a 8 week period ish of missed work.Sadly not. Still having physio. Also medical investigations that may require an op. And not back to herself mentally either
Additionally if this has impacted her mental state, a psychiatric report would be required (often overlooked) and not only does this impact on valuation, but she again may require therapy which needs to form part of the schedule.
Lastly there may be a disadvantage on the labour market (if for instance she is unable to run self employed and has to return to an employed status) and future loss of earnings if she is not able to return to 100% for a certain period.
elise2000 said:
The guy on the phone this morning was saying to not use three years of tax returns would be fraudulent! And he told her last week if she did not sign the document agreeing to their figure me that she would be in contempt of court! All utter nonsense obviously. All very stressful for her.
If 'guy on the phone' is the solicitor, he's been instructed by the insurers so no doubt trying to keep the claim as low as possible and with minimum work for himself. Both reasons not to do what he wants!Gassing Station | Speed, Plod & the Law | Top of Page | What's New | My Stuff