Court Recognises The Importance Of Looking At The Practical Reality In Landmark Case Addressing Loss Of Financial Dependency
Lawyers at Irwin Mitchell have spoken about a ‘groundbreaking’ judgment at The Court of Appeal, which upheld an earlier High Court ruling in Rix v Paramount that determined a loss of financial dependency should be calculated on potential future income.
The appeal from Paramount’s lawyers argued that that the family of Martin Rix had no financial dependency claim because the family business had been profitable since Mr Rix’s death aged 60, in 2016.
The insurers of Paramount sought to deprive Mrs Rix of damages for future income, arguing that despite the death of Mr Rix, she had suffered no financial loss, as she inherited the business.
In dismissing the appeal on all grounds, the judges upheld a 2020 High Court judgment, which accepted Mrs Rix had suffered a loss of financial dependency and determined this should be calculated based on her husband’s potential future income from the business.
The written judgment states that the approach to the law and the facts of the case in the original judgment was “careful, considered and clear”. It was acknowledged that “the dependency is fixed at the moment of death” and that what decisions people make afterwards, or if the business continued to be profitable or not, is irrelevant.
There was also a distinction between the loss from “the contribution of the deceased” to the business and any loss of income from a capital asset; thus recognising the ongoing importance to the business of Mr Rix and that he was primarily responsible for its success.
Expert Opinion“We are delighted to have secured justice for the family and for the first time, this groundbreaking case recognised an individual’s importance to the business but also that financial dependency should be based on the situation at the point of death.
“This case pushes the boundaries of the law and in making the judgment; the Court recognised the need to look at the practical realities in cases like this, which is the approach Irwin Mitchell has always adopted.”
“It is regrettable that the family have had to pursue the case through the courts and ensure not one, but two hearings in order to obtain the right outcome. It is disappointing that the insurers were unwilling to compromise on the issues determined by the Court of Appeal.” Joanne Jefferies - Partner
Mr Rix passed away in April 2016, having been diagnosed with mesothelioma less than three months previously. Mesothelioma is a terminal cancer of the lining of the lungs, almost always associated with historic exposure to asbestos.
At the time of diagnosis, Mr Rix was running a successful business, combining construction, building, joinery and the manufacture of laminate worktops. He started the business in Dunstable, aged 21 in 1976. He worked hard and long hours over the years, which enabled him to retain many loyal employees and customers.
Described by the trial Judge as a “remarkably talented and dedicated businessman,” Mr Rix’s death in 2016 robbed the firm of his unique skills and his family of a much loved husband and father.