Brachial plexus birth injury and periodical payment orders (PPOs)

The importance of considering the long term implications in brachial plexus birth injury claims, and of seeking a PPO element in any award

An obstetric brachial plexus birth injury (also known as Erb’s Palsy) is not the most serious of the conditions arising from negligent management of birth and delivery, but the long-term consequences should not be underestimated. As most Erb’s palsy cases are settled when the injured person is young, compensation awards that appear adequate now may well leave difficulties in later life.

Julian Matthews, Barrister of 7BR, and Endurance Arthur, Partner and Solicitor of Tozers LLP, examine how Periodical Payment Orders (PPOs) can provide a measure of security for the longer term, even if the amount of the annual award is relatively modest. A recent settlement in the case of S is used to illustrate this.

Brief summary of Periodical Payment Orders

PPOs are a form of compensation which can be awarded in personal injury claims. Courts in England, Wales and Northern Ireland have been able to award PPOs since April 2005.

PPOs may be awarded on their own but are usually combined with a lump sum. They consist of regular payments (known as periodical payments) which are intended to cover the Claimant’s future financial losses, including care and case management costs for the rest of the Claimant’s life. The payments are uplifted every year by a measure of inflation to protect their real value. This can provide greater flexibility and security than one lump sum.

PPOs are mainly used in high-value claims of £1 million or more, where payments can be reasonably substantial. Payments are usually made annually and are secure because, once PPOs are agreed, the payments are guaranteed.

Background to S’s claim

S sustained severe traction damage to the left brachial plexus, with damage to the C5, C6, C7, C8 and T1 nerve roots as a result of a mismanaged shoulder dystocia during her birth. She was subsequently assessed as having a Grade 3 Obstetric Brachial Plexus Palsy (“OBPP”), also known as Erb’s palsy. S required a series of operations on her arm throughout her childhood and adolescence and may require further surgery in future, which could lead to reduced range of movement. Currently her affected left arm is smaller and 9cm shorter than her right arm, and she has a fixed elbow flexion contracture of approximately 44 degrees. She has less than half the normal range of movement in her left shoulder, with no rotation, and a very significant loss of pronation and supination. She also has less than half of the normal arc of movement at the elbow, no flexion at the wrist, and a very significant loss of grip strength. She suffers from daily aches and pains and disturbed sleep as she is unable to lie on her left side without discomfort. There is also post-operative scarring.

Long term considerations

Work

Children with Erb’s palsy experience a reduced range of roles, often being deemed unfit for occupations with a physical element (including the armed forces, police and fire brigade). People with Erb’s may also be restricted in relation to promotion pathways and mainstream professions, thereby potentially missing out on the benefits provided by larger employers.
There is often optimism expressed by orthopaedic surgeons in relation to what adult life and work will be like for children with Erb’s. This is understandable from a clinical perspective, but S’s case showed that whilst theoretically she ought to be able to manage full-time work, in reality this is not the case.

S was determined to train as a vet nurse and obtained a degree course. In the course of S’s training, she had to undertake work placements. She found that her levels of persistent pain increased whilst she was working. This suggested that S would continue to be in constant pain throughout her working life and could only consider light work with no bimanual dexterity. S will be unable to perform any work requiring the use of her arms at or above chest height or below waist height. Indeed, she will be unable to undertake any work which requires significant function of the left arm at any level, or bimanual repetitive activity or bimanual strength activity.

The medical evidence in S’s case was that, in view of her difficulties and symptoms, S was very likely to have to take early retirement if she continued to work in the same field, due to her lack of bimanual functional reserve. The corollary of these problems is that S would be likely to end her working days, even if only part time, in a state of pain and having expended considerable personal resources.

There were also concerns that S’s physical restrictions, which limited her flexibility in the workplace, could prevent her progress as a vet nurse to higher status roles. This is critical as such higher status roles eventually lead to management (where her injury would become less of an issue).

Domestic life

Theoretically, someone with Erb’s can perform many of the tasks required for self-care and independent living, albeit more slowly and requiring more effort. According to care assessments that we have seen, the self-care and independence issues presented by Erb’s may only require 1 or 2 hours per week in care provision.

However, these assessments disregard the extra effort required for a working person with Erb’s. As noted above, many people with Erb’s are determined to live as normal a life as possible, which should be facilitated to avoid disadvantage.

This means looking at the whole of the probable work/life balance when seeking to apply the compensatory principle: i.e. what is reasonably required to put the person into the position they would have been in had they not sustained their injury. When approached in this way, more extensive domestic support becomes entirely reasonable to try and redress the balance.

Middle and old age

Assessment is often done in the context of a relatively young adult, when reserves of energy are at their greatest and the challenges of life fewer. In middle life there are increasing complexities and demands as a result of family and children, aging parents, health issues with partners or other relatives and friends, and increased community responsibility.

Accordingly, a creative approach to assessment is required which considers all of these issues, together with the fact that the provision will likely be needed to cover the residual years of life. The approach should also consider the purchasing power of an award of damages, 50 to 60 years in advance of when it is needed.

It is here that a PPO, with inflation linked payments, can be of very significant value, even in respect of relatively modest amounts of domestic care and support. It is likely that PPOs will be most desperately needed in future years when the injured person has become less economically active and less able to build up capital and pension. Lump sums do compensate for this, although there is a risk that passage of time and unexpected issues will leave inadequate funds for a Claimant’s old age.

S’s claim

Periodical Payments were a particular concern in S’s case. A lump sum was required to enable S to make substantial purchases, including a property. However, a PPO was also needed to provide the security of ongoing payments in relation to care support, assistive therapies, aids and equipment which S would need. A PPO would also relieve S from managing a large sum of money over her lifetime, as well as protecting her future damages from being depleted by more short-term pressures.

Accordingly a settlement package was negotiated that provided for a substantial lump sum as well as a PPO (averaged out on a lifetime basis), including a reasonable number of hours of care support, index linked to domestic care rates and a further smaller annual sum to cover assistive aids and services linked to inflation via the retail price index (RPI). The combined annual total was just under £10,000.

Whilst some resistance will nearly always be met from Defendants to relatively modest awards under a PPO, if the Claimant plainly has long term regular needs and wishes the Court to make a PPO award, the Court will likely do so. This should persuade a Defendant that an award to reflect these costs, as part of the overall settlement package, ought to be made in order to avoid the matter proceeding to trial. If there is resistance, a well-judged Part 36 Offer can be used to apply pressure to make a mixed lump sum and PPO award.

Conclusion

A PPO award should always be considered as part of the compensation package when formulating the claim in an Erb’s palsy case. It will not be appropriate in every case but, even if the annual payment may be relatively low, the value of such guaranteed index linked provision for life to Claimants should not be underestimated. The security and flexibility a PPO provides can be invaluable to vulnerable Claimants.

Julian Matthews, Barrister, 7BR, who specialises in complex clinical negligence claims including in particular birth injuries such as OBPP/Erb’s.

Endurance Arthur, Partner and Solicitor of Tozers LLP

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