This is an HTML version of an attachment to the Freedom of Information request 'Statistics on common law compensation claims against the MODs'.



 
 
 
 
 
          
 
 
 
 

Ministry of Defence
 
 
www.mod.uk 

 
 
 
 
 
 
 
 

Claims 
Annual Report 
JULY
2011/2012 
AUG  

Contents   
 
 
 
Introduction by the Head of Common Law Claims & Policy 
 
Executive Summary  
 
Section One 
-  Introduction 

 
 
 
 
 
Section Two 
-  Public Liability Claims  

 
 
 
 
 
Section Three 
-  Service Personnel Employer’s Liability Claims 
15
 
 
 
 
 
Section Four 
-  Civilian Staff Employer’s Liability Claims 
25
 
 
 
 
Section Five 
-  Motor Claims 
26
 
 
 
 
 
Section Six 
-  Clinical Negligence Claims 
29
 
 
 
 
 
Section Seven 
-  Area Claims Offices 
31
 
 
 
 
 
Section Eight 
-  Insurance and Indemnities  
35
 
 
 
 
 
Section Nine  
-  Law and Practice   
37
 
 
 
 
 
Annex A 
-  Common Law Claims & Policy Organisation 
49
 
 
 
 
 
Annex B 
-  Top 10 cases settled 2011/12 
  53
 
 
Distribution List  
54
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
  1
 
 
 
 

Introduction by the Head of Common 
Law Claims & Policy 
 
 
An unprecedented year of activity that included the management of a large 
number of high profile and complex cases undertaken by a slimmer CLC&P 
team. Overall payments were £87.8 million and £468,642 was recovered. 
 
The first Claims Annual Report was issued in 1997/1998 to provide a factual 
account of the overall number of claims received the number and overall value of 
those paid and how the Department handles such claims. It has been issued 
every year since then. The primary rationale remains the same today as it was 
then, which is to heighten awareness in all areas of the Department, both civilian 
and members of HM Forces, of the importance of sound risk management. Not 
only does this reduce the number of incidents that give rise to compensation 
claims, it also reduces the less quantifiable indirect or hidden costs of incidents 
such as loss of personnel and equipment. We firmly believe that the Claims 
Annual Report has helped steady the claims expenditure year on year.   
 
The 15 May 2012 marked the 25th anniversary of the repeal of Section 10 of the 
Crown Proceedings Act. You may recall that prior to 15 May 1987 Service 
personnel were prevented by Section 10 from pursuing claims for compensation 
from the Ministry of Defence. This point of law applies to all Service personnel 
and has no bearing on rank, status or place of employment. However, Section 10 
was repealed by The Crown Proceedings (Armed Forces) Act 1987. Since the 
change in the law, which was not made retrospective, Service personnel who 
suffer loss or injury as a result of negligence by the MOD have been entitled to 
make common law claims for compensation. Details of the case can be found in 
Section 3. 
 
I have previously mentioned the impact on the defence budget because of the 
indirect or hidden costs of a compensation claim and it is worth drawing attention 
again to such matters. These costs are paid by the relevant TLB not the centrally 
funded claims budget: 
 
•  Damage to equipment and materials 
•  Interruption to training exercise immediately after the accident 
•  Investigating the accident 
• Lost 
man-days 
•  Loss of experience and skills 
•  Recruitment and training costs for replacement staff 
•  Reduced capability of injured Service personnel 
• Reputational 
risk 
• Stress 
• Morale 
•  Dealing with third parties 
•  Costs associated with a Crown censure 
 
  2
 
 
 
 

 
The hidden cost of an accident (i.e. non-compensation costs) is estimated to be 
at least six times the value of the compensation paid. At the highest level it can 
be thirty times the value e.g. loss of a fighter aircraft, etc. 
 
On 14 March 2012 the Supreme Court ruled on a majority decision that the 
claims brought by Nuclear Test Veterans were time barred and were not 
prepared to apply discretion to allow late claims to proceed to a full liability trial. 
Perhaps of more significance all seven justices that heard the case said that the 
claims in terms of proving a causal link between illness and attendance at the 
tests were doomed to fail and had no prospect of success. Lord Brown noted 
“these appeals now provide the court with the opportunity…. once and for all to 
end, the false hopes on which these claims have for so long rested”. Details of 
the case can be found in Section 3. 
 
As reported in last year’s Claims Annual Report, Lord Justice Jackson’s review of 
civil litigation costs was published in 2010 and it is hoped that the 
recommendations will be implemented in April 2013. We understand that the 
proposals will require primary or secondary legislation whilst other changes will 
require an amendment to the Civil Procedure Rules. 
 
The MOD led some very interesting Government cross cutting work that resulted 
in the first ever contract for a joint claims handling contract, which was won 
following a fierce competition by Gallagher Bassett International. The National 
Offenders Management Service of the Ministry of Justice and the Department for 
Communities and Local Government are parties to the contract, but the contract 
allows other Government Departments to use the service. The contract offers 
better value for money across government by improved economies of scale and 
ensures a consistent approach to claims handling. 
 
Finally, I should like you to keep in mind the following quote when reading this 
report. A Judge complained that he was no wiser at the end of the case than at 
the start. Counsel responded, “Possibly not my Lord, but far better informed” 
 
Additional hard copies of this report are available from CLC&P, Floor 1, Zone I,  
MOD Main Building, Whitehall, London SW1A 2HB. The report can also be found 
on the Defence Intranet. 
 
 
 
 
 
Jef Mitchell 
Head of Common Law Claims & Policy   
 
 
July 2012  
 
 
 
 
 
 
 
  3
 
 
 
 

                
 
Executive Summary  
 
 
1. 
Total CLC&P cash payments in the year 2011/2012 were £87.8 
million. Over the same period recoveries totalling £468,642 were 
achieved.    
 
2. 
The highest value claim settled in year was £1,678,411.    
 
3. 
The total number of new claims brought against MOD was 6,548  
 
 
4. 
2,495 Service Personnel Employer’s liability claims were settled at 
a total cost of £46.3 million.   
 
5. 
551 Civilian Employer’s liability claims were settled at a total cost of 
£15.7 million.  
 
6. 
382 Public Liability claims were settled at a total cost of £10 million.  
 
7. 
1,946 Third Party motor claims in the UK were settled at a total cost 
of £6.7 million.    
 
8. 
18 Clinical Negligence claims were settled at a total cost of £6.7 
million.  
      
      9.   
ACO Afghanistan settled 545 cases at a total cost of £748,421.       
 
10.   
ACO North West Europe settled 401 cases at a total cost of £1.26 
million.   
 
     11.   
ACO Cyprus settled 334 cases at a total cost of £491,602.  
 
12. 
ACO South Atlantic Islands settled 2 cases at a total cost of 
£3,654.         
 
 
 
 
 
 
 
 
 
 
  4
 
 
 
 

Section One 
 
 
Introduction 
 
 
Organisation 
 
1.1 
Common Law Claims and Policy (CLC&P) is a stand alone Division 
headed by a 1* and is part of the 2* Directorate of Business Resilience. 
   
1.2  CLC&P is primarily responsible for processing common-law, non-
contractual compensation claims against and on behalf of the Ministry of 
Defence at home and abroad. It is not responsible for contractual, quasi-
contractual, maladministration, sales or estates matters. Details of the staffing 
and work of CLC&P are at Annex A. 
 
 
Responsibilities 
 
1.3 
In addition to being responsible for processing common law compensation 
claims, CLC&P also has a number of other important responsibilities such as 
providing claims policy advice, handling claims against foreign forces based in 
the UK and providing advice on insurance and indemnities.  It undertakes a 
variety of secretariat tasks and during the period of this report continued to deal 
with a large number of Parliamentary Questions, Ministerial Correspondence, 
Treat Official Correspondence and Freedom of Information requests.   
 
 
1.4 
Area Claims Officers (ACOs) and their staff are located in areas where 
there is a sizeable defence presence – Afghanistan, Cyprus, North West Europe, 
and the South Atlantic Islands. ACOs are accountable to the appropriate Civil 
Secretary, but have a professional responsibility to the Head of CLC&P.  
 
 
Policy and Procedures 
 
1.5 
When compensation claims are received they are considered on the basis 
of whether or not the Ministry of Defence has a legal liability to pay 
compensation. Where there is a proven legal liability, compensation is paid. To 
deal with cases on any basis other than legal liability requires difficult subjective 
judgments to be made that would undoubtedly lead to inconsistency and 
unfairness.  
 
1.6  The amount of compensation paid is determined by common law 
principles which, broadly, take account, as appropriate, of an individual’s pain 
and suffering, degree of injury, property losses, past and future financial losses 
and level of care required. Levels of compensation including these elements can 
 
  5
 
 
 
 

vary greatly depending on an individual’s circumstances. Advice is sought where 
necessary from Treasury Solicitor’s Department, and our commercial claims 
handlers’ panel solicitors for cases brought in England and Wales; the Crown 
Solicitor in Northern Ireland; and Morton Fraser Solicitors, the Department’s legal 
adviser in Scotland. Queen’s Counsel and junior barristers are also consulted on 
high profile or complex cases or where a point of law needs to be explored. The 
overwhelming majority of cases are settled through amicable negotiation without 
claimants having to take the Ministry of Defence to court. 
 
 
 
  6
 
 
 
 

Section Two 
 
Public Liability Claims 
 
 
 
2.1   The majority of claims submitted to the Public Liability Team (PLT) are for 
personal injury or property damage from members of the public who have either 
been injured on Ministry of Defence property or have sustained injuries whilst 
taking part in the various external events run by the three Services e.g. injuries 
sustained on assault courses.  
 
2.2    Property damage claims usually emanate from personnel working and 
living in service accommodation who, for example, have had their belongings 
damaged.     
 
2.3 
The increase in expenditure during 2011/2012 is largely because of 
claims arising as a result of incidents in Iraq.  
 
 
 2009/10 
2010/11 
2011/12 
Number of PL Claims 
548 771  416 
Received 
Number of PL Claims Settled 
263 
227 
251 
Amount Paid (£) 
£5.2M 
£4.4M 
£9.0M 
1000
£12,000,000
800
£9,000,000
600
£6,000,000
400
200
£3,000,000
0
£0
09/10
10/11
11/12
09/10
10/11
11/12
Claims received
Amount paid
Claims settled
 
 
Iraq 
 
2.4   The European Court considers that United Nations Security Council 
Resolution 1546 authorised the United Kingdom to take measures to contribute 
to the maintenance of security and stability in Iraq. However, neither Resolution 
1546 nor any other United Nations Security Council Resolution explicitly or 
implicitly required the United Kingdom to place an individual whom its authorities 
considered to constitute a risk to the security of Iraq into indefinite detention 
without charge.  As a result PLT continues to handle claims from Iraqi citizens 
who were detained some of whom claim to be the victims of alleged abuse whilst 
held.  
 
  7
 
 
 
 

 
 
2.5 
UK based solicitors brought compensation claims against MOD, FCO and 
DFID on behalf of former Iraqi Locally Engaged Civilians (LECs) or their 
dependants who were engaged primarily as interpreters by the British 
Government in Basra during the period 2003 to 2008. It is alleged that they were 
threatened, kidnapped, tortured, shot and/or killed as a result of their 
employment by HMG which in some cases meant fleeing Iraq with consequential 
financial loss. Although brought against three Defendants the majority of the 
claims were against MOD.      
  
2.6 
When first intimated there were 180 claimants. Over time a number of 
claimants withdrew their claims and this saw the total number reduce to 56.    
 
2.7 Ministerial 
approval 
was obtained in all three Departments to hold a 
settlement meeting with the claimants’ legal representatives to discuss a cost 
effective compromise of the claims that would be capable of being recommended 
to respective Ministers as an acceptable settlement. This meeting took place on 
12 October 2011 and a compromise agreement reached without admission of 
liability; this was fully endorsed by Ministers in MOD, FCO and DFID. The terms 
of the settlement remain confidential to the parties.   
 
 
 
Afghanistan 
 
2.8 
ACO Lashkar Gah continues to handle claims locally in Afghanistan.
 
 
Kosovo 
 
2.9 
PLT is also responsible for handling a small number of residual claims 
resulting from the closure of the ACO Kosovo office which are awaiting 
adjudication by the Claims Commission or Arbitration Tribunal in Sarajevo. 
 
 
Maritime Claims 
 
2.10  Maritime claims by and against the Ministry of Defence result mainly from 
collisions, oil spillage, gunnery/missile firing accidents, damage to static property, 
wash damage, fishing gear damage and the salvage and recovery of Ministry of 
Defence property. Maritime law is complex and much of the legislation dealing 
with the law of the sea was enacted more than a century ago. 
 
 
 2009/10 
2010/11 
2011/12 
Number of property claims 
16 13 9 
received 
Number of property claims settled 
11 


Amount paid (£) 
£72,736 
£34,050 
£23,783 
 
  8
 
 
 
 

Number of salvage claims 
1 1 1 
received 
Number of salvage claims settled 
1 5 0 
Amount paid (£) 
£8,879 
£29,042 
£8,600 
 
 
18
£100,000
16
14
12
10
8
£50,000
6
4
2
0
09/10
10/11
11/12
£0
Property Claims  received
09/10
10/11
11/12
Property Claims  settled
Salvage Claims received

Property Claims  paid
Salvage Claims  paid
Salvage Claims settled
 
 
 
 
2.11  The Ministry of Defence provides assistance to ships in distress in UK 
waters and regularly helps in other parts of the world. If as the result of the 
assistance given a vessel is salved, the Department is entitled to claim salvage 
based on the value of the ship and its cargo. Part of the amount in salvage is 
paid to the crew of the assisting ship or aircraft in accordance with the Merchant 
Shipping Act 1864. It is Ministry of Defence policy not to claim salvage when life 
saving has been the main aim of the assistance given. Although uncommon, 
salvage claims by members of the public for the successful recovery of our 
property can likewise be made against the Department. The figures for salvage 
claims reflect the net effect of salvage claims paid by Ministry of Defence and a 
successful recovery. 
 
 
 2009/10 
2010/11 
2011/12 
Number of maritime recovery 
0 3 3 
and salvage claims initiated 
Number of maritime recovery 
0 1 0 
and salvage claims settled 
Amount recovered (£) 
£444,282 
£85,596 
£0 
 
 
  9
 
 
 
 

£500,000
3
£450,000
£400,000
£350,000
2
£300,000
£250,000
£200,000
1
£150,000
£100,000
£50,000
0
£0
09/10
10/11
11/12
09/10
10/11
11/12
Claims received
Claims settled

Amount Recovered
 
 
 
2.12  For clarification, during 2009/2010 the Department made several 
recoveries but the cases were not deemed “settled” in year as there was 
requirement to pay salvage awards to the individuals involved in the incident 
leading to the claim. This can be a lengthy process and only at the conclusion 
will be case be formally closed.    
 
 
2.13  In addition to the work undertaken by CLC&P, Flag Officer Scotland, 
Northern England and Northern Ireland (FOSNNI) and Flag Officer Sea Training 
(FOST) have delegated authority to settle claims of up to £8,000 per fishing gear 
claim, £5,000 per collision claim and £1,000 per oil spillage claim. 
 
 
 2009/10 
2010/11 
2011/12 
 
 
Number of claims settled by 
12 
14 

FOSNNI 
 
Amount paid by FOSNNI  
£29,939 
£23,660 
£12,132 
 
 
Number of claims settled by 
19 
15 

FOST 
 
Amount paid by FOST  
£31,447 
£36,595 
£12,725 
 
 
 
 
Total amount paid 
£61,386 
£60,255 
£24,857 
 
 
 
 
Low Flying Military Aircraft Claims 
 
2.14  The activities of low flying military aircraft can give rise to claims for 
compensation from members of the public. The most common claims are those 
involving injury to, or death of, livestock and/or damage to property although 
 
 10
 
 
 
 

claims are sometimes received for personal injury. Many of the claims are for 
relatively small amounts. Such claims are handled on an ex-gratia basis, but are 
investigated in the same way as if the principles of common law legal liability 
applied. The foundation of this approach is the Royal Prerogative, which gives an 
absolute right for all military flying activity, and, therefore, an injured party has no 
legal rights of redress for compensation. Lord Drumalbyn set out this approach in 
a Lords Written Answer on 22 November 1971 (Official Report Column 888):  
 
"… No remedies exist in law against any military aircraft flying by virtue of 
the Royal Prerogative for the purpose of the defence of the Realm or of 
training or of maintaining the efficiency of the Armed Forces of the Crown. 
The ... Ministry of Defence will, however, pay compensation on an ex 
gratia basis if satisfied that the damage has been caused by a military 
aircraft." 
 
 
2.15  A procedure has been in place since 1994, following consultation with 
various farming unions and landowners’ associations, for dealing with claims 
relating to death or injury to livestock. The procedure was most recently updated 
in December 1999 after a round of consultations with the NFU, Country 
Landowners’ Association and other similar bodies. In accordance with the 
Livestock and Animal Compensation Claims Guidance the claimant should report 
the incident promptly, provide veterinary evidence and a fully quantified claim.  
 
2.16  This is a category of work that requires careful monitoring to identify 
potentially fraudulent claims. Cases are referred to the Ministry of Defence Police 
if the evidence indicates there is a potential problem. 
 
2.17  The reduction in expenditure in 2011/2012 reflects the slightly lower 
number of claims received and the fact that there were fewer higher valued 
claims settled in-year.  
 
 
 2009/10 
2010/11 
2011/12 
Number of claims received 
146 
143 
130 
Number of claims settled 
103 
99 
88 
Amount paid (£) 
£0.65M 
£0.67M 
£0.46M 
 
 11
 
 
 
 

£700,000
£650,000
£600,000
£550,000
£500,000
£450,000
150
£400,000
£350,000
£300,000
100
£250,000
£200,000
50
£150,000
£100,000
£50,000
0
£0
09/10
10/11
11/12
09/10
10/11
11/12
Claims received
Claims settled

Amount paid
 
 
 
 
Visiting Forces Claims 
 
2.18  PLT handles third party claims by and against Visiting Forces based in or 
visiting the United Kingdom under the provisions of Article VIII of the NATO 
Status of Forces Agreement (SOFA) and Section 9 of the Visiting Forces Act 
1952. Such claims could be on behalf of any of the states who are signatories to 
the agreement or who are invited to train in the UK, but primarily involve the 
USA, the Netherlands, Belgium and Germany. Claims are investigated and 
handled in exactly the same way as if British Forces were involved and, if 
satisfied that the Visiting Force is liable, the Ministry of Defence pays 
compensation on its behalf. In the case of NATO countries, the Sending State is 
billed for 75% of the amount paid, the United Kingdom paying the other 25%.  
 
 
 
 
2009/10 2010/11 2011/12 
Number of visiting forces claims 
57 32 26 
received 
Number of visiting forces claims 
48 32 26 
settled 
Compensation paid (£) 
£226,594 
£173,044 
£508,195 
 
 
 
 12
 
 
 
 

60
600,000
500,000
400,000
30
300,000
200,000
100,000
0
0
09/10
10/11
11/12
09/10
10/11
11/12
Claims received
Claims settled
Amount paid
 
 
 
 
Visiting forces breakdown 
 
Low Flying 
Property 
Personal 
2011/12 
RTAs Total 
Damage 
Injury 
Claims Received 



17 
26 
Claims Settled 


11 
11 
26 
Compensation Paid (£) 
£674 
£4,730 £334,291 
£16,309 
£508,195 
 
 
 
 
 
Financial Recoveries 
 
2.19  Where the Ministry of Defence sustains loss or damage to equipment, or 
property, which has been caused by a third party, PLT will seek to recover those 
losses from the third party. The main causes for taking action against third 
parties are occasions where Ministry of Defence static property has been 
damaged by vehicles, fire, water or the negligent actions of a contractor. 
 
2.20  Less often, PLT will seek to recover compensation from third parties 
overseas following road traffic accidents and will also assist visiting forces to 
make recoveries in the UK if requested to do so. 
 
2.21  The number of recoveries processed by PLT in each of the last three 
financial years is shown in the table below.    
 
 
 
 2009/10 
2010/11 
2011/12 
Number of claims notified 

14 
12 
Number of successful 
3 5 3 
recoveries 
Amount recovered (£) 
£44,137 
£37,061 
£35,258 
 
 13
 
 
 
 

15
40,000
20,000
0
0
09/10
10/11
11/12
09/10
10/11
11/12
Claims notified
Successful recoveries
Amount recovered
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 14
 
 
 
 

 
Section Three 
 
Service Personnel Employer’s Liability Claims 
 
 
3.1 
Prior to 1948, it was not possible for any individual to sue the Crown. This 
was because of the long held principle that “the Crown could do no wrong”. 
However, in 1947, legislation was passed enabling the Crown to be sued for acts 
of negligence. Section 10 of that legislation, The Crown Proceedings Act 1947, 
prevented Service personnel who were on duty or on any land, premises, ship, 
etc. being used for the purposes of the Armed Forces, from suing for 
compensation. This position remained until 15 May 1987 when The Crown 
Proceedings (Armed Forces) Act 1987 repealed Section 10 of The Crown 
Proceedings Act 1947. Since then Service personnel have, like any other 
employee, been entitled to sue the Ministry of Defence for compensation where 
they have suffered as a result of the Department’s negligence. The repeal of 
Section 10 was not made retrospective.  
 
3.2 
At the time of the passage of the 1987 Bill, the question of retrospection 
was debated and motions to allow members of the Armed Forces, past and 
present, to pursue claims for injury or death suffered in incidents since 1947, 
were mooted. They were however defeated or withdrawn. The view that 
prevailed at the time was that there would have been no logical point at which to 
draw a line, short of trying to cover all incidents and all types of injury going back 
to 1947 and that to make the Act retrospective would create many new examples 
of unfairness and injustice.  
 
3.3  Mr Matthews, an ex-serviceman suffering from an asbestos-related 
disease, challenged this position on the basis that Section 10 of the Crown 
Proceedings Act 1947 is incompatible with the European Convention on Human 
Rights. Mr Matthews alleged a breach of Article 2 (right to life) and Article 6 (due 
process rights) of the Human Rights Act. The case under Article 2 was that by 
exposing him to asbestos dust the Crown was in breach of its obligation to take 
positive steps to safeguard his health. The case under Article 6 was that Section 
10 of the Crown Proceedings Act is a 'blanket' immunity which deprives him of 
his right of access to the Court. The matter was heard in the High Court in 
December 2001 and judgment handed down by Mr Justice Keith on 22 January 
2002 in favour of the claimant. The Department, however, secured leave to take 
this matter expeditiously to the Court of Appeal and the hearing took place in 
April 2002. The Court of Appeal overturned Mr Justice Keith’s decision on 29 
May 2002, but granted leave for Mr Matthews to take this matter to the House of 
Lords. Their Lordships considered this matter in January 2003 and handed down 
a unanimous judgment on 13 February in favour of the Ministry of Defence. The 
five Law Lords agreed that there had never been the right in national law that Mr 
Matthews sought to assert i.e. that a member of the Armed Forces could sue the 
Crown in tort, and that he has no “civil right” that Article 6 of the European 
Convention on Human Rights can operate to protect.  
 
 15
 
 
 
 

 
3.4 
The Armed Forces Compensation Scheme (AFCS) is a compensation 
package for members of the Armed Forces that became effective on 6 April 
2005. The legislation replaces the previous arrangements under the War 
Pensions Scheme and is administered and paid by the Service Personnel & 
Veterans Agency. The scheme covers all Regular (including Gurkhas) and 
Reserve personnel whose injury, ill health or death is caused by service on or 
after 6 April 2005. Ex-members of the Armed Forces who served prior to this 
date, or who are receiving a current War Disablement Pension or War Widows’ 
Pension, are not affected by the new scheme. They will continue to receive their 
War Pension or War Widows’ pension and any associated benefits in the normal 
way. 
 
3.5 
The AFCS provides modern, fair and simple arrangements with more 
generous benefits for the more severely disabled. It provides compensation for 
significant injuries, illness and death that are caused by service including when 
they result from warlike incidents or terrorism. The AFCS is designed to provide 
compensation, irrespective of fault, across the full range of circumstances in 
which illness, injury or death may arise as a result of service. The AFCS does not 
seek to affect a person’s right to make a civil claim if the illness, injury or death 
was caused by the Department’s negligence. In cases where payments from the 
AFCS are already in place, common law damages will be abated. However, in 
the unlikely event that payments from the AFCS are not in place at the time of 
settling common law damages, the damages figure will be passed to the Service 
Personnel & Veterans Agency (SPVA) who will abate the AFCS as appropriate 
 
3.6 
Under the terms of the Scheme a lump sum is payable to Service or ex-
Service personnel based on a 15-level tariff graduated according to the 
seriousness of the condition. A graduated Guaranteed Income Payment (GIP), 
payable for life, will also be paid to those who could be expected to experience a 
significant loss of earning capacity. A GIP can also be paid to surviving partners 
(including unmarried and same sex partners) where the service person's death 
was caused by service. 
 
3.7 
The handling of routine personal injury claims from Service and ex-
Service personnel has been contracted out since 1 July 1996. Royal & Sun 
Alliance held the contract until 30 April 2007.  Since that time Gallagher Bassett 
International Limited have handled such claims following competitive tender 
exercises.  Claims that are contentious or are of a political or sensitive nature are 
handled in house by CLC&P.  
 
3.8 
The number of claims and amounts paid are shown below: 
 
 
 2009/10 
2010/11 
2011/12 
Number of claims received 
1115 
2583 
3535 
Number of claims settled 
872 
1745 
2495 
Amount paid (£) 
£39.8M 
£67.3M 
£46.3M 
 
 
 16
 
 
 
 

3000
2500
60,000,000
2000
1500
40,000,000
1000
20,000,000
500
0
0
09/10
10/11
11/12
09/10
10/11
11/12
Claims received
Claims settled

Amount paid
 
 
 
3.9 
As forecast the expenditure in 2011/2012 is lower than the previous year 
which had included settlement of the high value claims associated with the 
Hercules and Nimrod crashes of 2005 and 2006 respectively. Large numbers of 
Noise Induced Hearing Loss claims relating to Army service in Northern Ireland 
have continued to be received and settled where appropriate.  
 
 
 
Combat Immunity 
 
3.10  Among the claims being handled in-house are those which relate to 
operational service in Afghanistan and Iraq. It is open to the Ministry of Defence 
to plead a defence of combat immunity in those claims where the injury was 
sustained engaging the enemy in the course of hostilities. The Court of Appeal 
handed down this ruling on 21 February 1996 in Mulcahy - v- MOD when it was 
held: 
  
"One soldier did not owe to another a duty of care in tort when engaging the 
enemy in the course of hostilities. Furthermore there was no duty on the Ministry 
of Defence to maintain a safe system of work in battle conditions. Accordingly, a 
soldier who was injured in battle conditions did not have a cause of action in 
negligence against the Ministry." 
 
 
3.11 The 
Mulcahy  judgment was clear, but this ruling was expanded in Bell & 
Others -v- MOD (the PTSD Group Action) when Owen J ruled:  
 
“Does the immunity apply to anti-terrorist, policing and peace keeping operations 
of the kind in which British forces were engaged in Northern Ireland and in 
Bosnia? In my judgment it will apply to operations in which service personnel 
come under attack or the threat of attack. 
 
 
[Furthermore] the term combat has an extended meaning in that 
 
a. the immunity is not limited to the presence of the enemy or the occasions 
when contact with the enemy has been established. It extends to all active 
operations against the enemy in which service personnel are exposed to attack 
or the threat of attack. It covers attack and resistance, advance and retreat, 
pursuit and avoidance, reconnaissance and engagement. 
 
 
 17
 
 
 
 

 
b. the immunity extends to the planning of and preparation for operations in 
which the armed forces may come under attack or meet armed resistance. 
 
 
c. the immunity will apply to peace-keeping/policing operations in which service 
personnel are exposed to attack or the threat of attack”.  
 
3.12   In Bici -v- MOD, Elias J narrowed the judgment in Bell & Others by stating:  
 
But any such threat must in my view be imminent and serious”.  
 
3.13  
The Department is facing a significant number of personal injury claims 
emanating from deaths and injuries in Iraq and Afghanistan. Some of these 
claims have been brought on dual grounds, with claims based on: 
 
(i)  Article 2 (the right to life) of the European Convention on Human 
Rights, alleging that the MOD failed to take all reasonable steps to minimise 
the risk to life before committing troops to operations; and 
 
(ii)  Common law negligence, alleging that MOD failed in its duty of care to 
Service personnel on operations. 
 
3.14 
The majority of these cases were stayed behind Smith v MOD in which 
the Supreme Court held that servicemen on active service overseas (who are not 
within a UK military base or hospital) are not within jurisdiction for the purposes 
of the ECHR. Pte Smith was a reservist who died of hyperthermia while based at 
a British camp in southern Iraq in 2003. 
 
3.15  
The claims in negligence are typically based on the following:  
 
a.  Allegations that a commander on the ground was negligent in his 
actions or made decisions that were wrong 
 
b.  Allegations that equipment provided by MOD was inadequate; 
 
c. Allegations that pre-deployment training provided by MOD was 
inadequate. 
 
 
3.16  
Following the decision in Smith, MOD argued that the claims in respect 
of breach of Article 2 were doomed to fail and the judge duly struck out the 
Article 2 claims. That position will only change if there is a further ruling from the 
European Court of Human Rights in Strasbourg in relation to the extra-territorial 
application of ECHR to members of the armed forces, which is considered 
unlikely. 
 
3.17  
The judge was prepared to strike out/give summary judgment in 
respect of the operational decisions made by commanders on the additional 
ground that these did not come within Article 2. He held that “there is no sound 
 
 18
 
 
 
 

basis for extending the scope of the implied positive obligations under Article 2 
so as to cover decisions made in the course of military operations”.  
 
3.18  
This left the negligence claims: 
 
 
a. 
Allegations that equipment provided by MOD was inadequate; 
 
 
b. 
Allegations that pre-deployment training provided by MOD was 
inadequate 
 
3.19         The judge ruled that although the equipment claims might give rise to 
complex and difficult questions of an essentially political nature or to decisions in 
relation to which a wide discretion must be exercised when considering whether 
it would fair, just and reasonable to impose a duty of care, it did not demonstrate 
“conclusively” that it would not be fair, just and reasonable to impose duties of 
care. He was not persuaded that there should be a blanket exclusion of liability 
and therefore refused to strike out/give summary judgment on the common law 
equipment claims. 
 
3.20      The judge also refused to strike out the training claims. He drew a 
distinction between pre-deployment training and in-theatre training. In principle 
the latter falls squarely within combat immunity and although he considered that 
on the face of it the allegations fell within combat immunity, he thought this issue 
was better resolved at a full blown High Court trial. 
3.21      MOD decided to appeal the decision that there should not be a blanket 
exclusion of liability on claims against the Department on injuries incurred due to 
equipment provided by the MOD. 
 
3.22      The  Judge  refused  both  MOD’s application and the claimants’ 
application (relating to the Article 2 claims) to appeal his judgment. The parties 
therefore submitted an Application for Permission to Appeal direct to the Court of 
Appeal. Permission was granted and the Appeal will be heard for three days 
commencing 25 June 2012.    
 
 
 
Summary of “Group Actions” 
 
 
Nuclear Test Veterans 
 
3.23  This and previous Governments’ frequently stated position has been that 
there is no evidence of excess illness or mortality amongst the veterans as a 
group which could be linked to their participation in the tests or to exposure to 
radiation as a result of that participation. Formal and well-documented 
procedures were in place to ensure the health and safety of those participating in 
the tests. Personnel Safety Plans were prepared and used for each operation 
and environmental monitoring was undertaken. Personal monitoring and 
protective clothing was used where appropriate for each trial. The effectiveness 
 
 19
 
 
 
 

of these procedures is demonstrated by the fact that the majority of participants 
received little or no additional radiation exposure as a result of participation.  
 
3.24  This is borne out by three studies into cancer incidence and mortality 
amongst nuclear test participants conducted by the independent National 
Radiological Protection Board (NRPB). The latest Report NRPB-W27 entitled 
“Mortality and Cancer Incidence 1952-1998 in UK Participants in the UK 
Atmospheric Nuclear Weapons Tests and Experimental Programmes” published 
in 2003 concluded that overall levels of mortality and cancer incidence in the 
nuclear weapons test participants have continued to be similar to those in a 
matched control group, and for overall mortality to be lower than expected from 
national rates. The Department’s consistent line has been that we have every 
confidence in the independent studies, and there are no grounds for 
compensation to be paid to British nuclear test veterans.  
 
3.25  However, where individual veterans are able to produce reliable evidence 
to raise a reasonable doubt that their illness is related to their service, they are 
entitled to a War Pension. The War Pension Scheme provides a framework for 
assessing and paying no-fault compensation for injury or death due to Service, 
and the burden of proof is light: applicants have only to raise a “reasonable 
doubt” that their loss was caused by Service to qualify. An applicant unhappy 
with the outcome of their claim can pursue the matter by way of the Pensions 
Appeal Tribunal, and beyond that to the Social Security Commissioners if 
necessary. A number of such pensions are in payment to NTVs and to their 
widows.  
 
3.26  In July 2002 the MOD learned that two firms of solicitors, Alexander Harris 
and Clarke Willmott, had been granted Legal Services Commission funding to 
explore the feasibility of bringing claims against MOD on behalf of NTVs. Legal 
action began when Alexander Harris Solicitors sent a Letter of Claim dated 15 
November 2004 which indicated that they and Clarke Willmott Solicitors were 
instructed by nearly 1,000 British, Fijian and New Zealand Claimants. Some 
Claimants were beneficiaries of veteran servicemen rather than the servicemen 
themselves. It was alleged that the servicemen were not appropriately or 
adequately warned, advised or cautioned of the risks to their health likely to 
result from their participation in the various testing programmes.  
 
3.27  Legal proceedings were served upon MOD in April 2005 on behalf of 655 
British, 130 Fijian and 213 New Zealand nuclear test veterans. The Legal 
Services Commission funding to pursue the litigation was however subsequently 
withdrawn and the two original firms of solicitors are no longer involved in the 
case. Since April 2006, the litigation has been handled with a new firm of 
solicitors, Rosenblatt of London.  
 
3.28  Particulars of Claim were served on 29 December 2006, around a week 
before the claim would otherwise have lapsed. The MOD served a Summary 
Defence on 21 January 2008 and a High Court trial was held between 21 
January and 6 February 2009 to rule on limitation only; whether the MOD is 
prejudiced by the delay in bringing the claims given that many of its key 
witnesses are no longer alive, or able due to age, infirmity or loss of memory to 
 
 20
 
 
 
 

give evidence. MOD, working closely with the Atomic Weapons Establishment at 
Aldermaston, disclosed a list of 12,295 documents in June 2008 that are 
considered relevant to the proceedings and the parties identified five lead cases 
each which they considered representative of the entire claimant cohort.  
 
3.29  Mr Justice Foskett handed down his judgment on limitation on 5 June 
2009 and the main findings were as follows:  
 
•   He found 5 of the lead cases to be time-barred and 5 were not time-
barred. Importantly, in the 5 cases found to be time barred he exercised 
the Court’s discretion to permit an out of time case to proceed to trial (the 
section 33 Limitation Act 1980 discretion). This means that if not 
successfully appealed or not otherwise summarily disposed of or 
discontinued, all 10 lead cases and indeed the Group Action of 1,011 
cases may now proceed to a trial on causation and breach of duty.  
 
•   He did not find that MOD (or any other public body) concealed any 
evidence from the veterans or their representatives. Neither did he 
criticise MOD for the way in which it disclosed documents in these 
proceedings nor the way in which it released material to the National 
Archives. There was no criticism of the War Pension Scheme.  
 
•   He expressed concern about whether or not the Claimants can prove their 
case, particularly whether any of them can prove that they have a 
condition caused by exposure to ionising radiation at the tests. He said 
that he did not want the Claimants to be misled by his judgment into 
thinking that they will be successful at trial, which he refers to as a ‘false 
dawn’.  
 
•   He essentially declined to express a conclusion on whether or not the 
Claimants are unable to prove causation based upon the current 
applicable legal test, considering the matter best dealt with at trial and 
believing that the Claimants need to adduce more expert evidence in 
order to have a hope of success. He acknowledged that the case law as it 
stands and if strictly read poses a potential problem for the Claimants, but 
considers that the law is in flux on this point and may be developed to 
assist the Claimants in the future.  
 
•   He appeared to accept the premise that the Rowland report may provide 
the Claimants with at least an arguable starting point for their case on 
causation but acknowledged that the Claimants will need more evidence 
to succeed at trial. He “assumes Rowland will withstand scrutiny”.  
 
•   He was of the view that the case can be fairly tried on the documentary 
evidence available and that the absence of many key live witnesses would 
not be unfair or prejudice the MOD’s case.  
 
•   He concluded that it would be “a very regrettable consequence” if it was 
necessary to decide that some cases could go forward to trial and that 
others could not. In handing down the judgment he says that a layman 
 
 21
 
 
 
 

would say that to be fair to the claimants the case should proceed to a 
causation trial.  
 
•   He acknowledged that it may be an injustice to MOD if it had to pay the 
Claimant’s costs of the case because it was successful at the limitation 
hearing but it is later discontinued because it is without merit in relation to 
causation or breach of duty. He invited submissions as to how the Court 
might obviate that potential injustice.  
 
•   He invited the parties to negotiate a settlement via mediation.  
 
3.30  Following submissions on 18 June 2009, Mr Justice Foskett granted MOD 
leave to appeal his decision on the limitation issue. In accordance with the 
Judge’s wishes, meetings were the claimants’ legal representatives to establish 
the boundaries of a possible economic and efficient settlement without incurring 
substantial further legal costs in taking these cases to a full trial on causation. No 
agreement was reached.  
 
3.31  In order to protect the Ministry’s position, grounds for appeal were lodged 
at the Court of Appeal on 12 October 2009. The Appeal was heard by Lady 
Justice Smith, Lord Justice Leveson and Sir Mark Waller between 7 and 14 May 
2010. The Court of Appeal overturned the High Court ruling in all respects save 
one case in a judgment dated 22 November 2010, which MOD did not appeal in 
relation to the Limitation Act but did mention to the court that the case was very 
weak on causation. The Court fully examined whether the claims were brought 
within the period allowed by the Limitation Act and if it should apply discretion to 
allow late claims to proceed to a full liability trial. In arriving at its judgment the 
Court, to some extent, considered the merit of the claims in terms of causation 
and concluded that the general merits of the claims were extremely weak. The 
Court supported the approach the MOD took to in relation to the extensive 
disclosure of relevant documents. 
 
3.32  The Veterans subsequently filed an Application with the Supreme Court 
and on 28 July 2011 was granted Permission to Appeal. In granting permission 
Lord Philips said: 
 
"Might I just emphasise this is only an application for permission to 
appeal. The court would not wish to raise false optimism in what are 
obviously some very difficult cases." 

 
3.33  The appeal to the Supreme Court was heard for 4 days commencing 14 
November 2011 before seven Justices - Philips, Brown, Hale, Walker, Mance, 
Wilson and Kerr. They handed down their decision on 14 March 2012, ruling in 
favour of MOD that the claims brought by Nuclear Test Veterans were time 
barred and declined to allow the claims to proceed under the statutory discretion. 
 
3.34  Perhaps of greater significance is that all the Justices recognised that the 
veterans would face great difficulty proving a causal link between illnesses 
suffered and attendance at the tests. The Supreme Court described the claims 
as having no reasonable prospect of success and that they were doomed to fail. 
 
 22
 
 
 
 

Lord Brown said “these appeals now provide the court with the opportunity….. 
once and for all to end the false hopes on which these claims have so far 
rested”. 
 
 
Radiation Compensation Scheme 
 
3.35  The Ministry of Defence is a member of the nuclear industry’s 
Compensation Scheme for Radiation Linked Diseases. This is a no-fault scheme 
where there is no requirement for claimants to prove negligence on the part of 
the Department in order to receive compensation. The Scheme, which the 
Ministry of Defence joined in 1994, was set up and is run jointly, by the 
participating employers and Trade Unions and does not affect a claimant’s right 
to seek legal redress. 
 
3.36  The Scheme provides for the assessment of a case, on an agreed 
technical basis, in order to determine the probability that a cancer contracted by 
a worker could have been caused by occupational radiation exposure. The 
amount of compensation payable in a successful case is determined by 
negotiation between the solicitors representing the parties based upon the same 
guidelines that would apply if the case had proceeded to Court. 
 
3.37  The Scheme provides for payments to be made for lower levels of 
causation probability than would be allowed by the Courts. In addition the 
Scheme provides “full” payment of compensation at a level of 50% causation 
probability and lesser payments down to a level of 20% causation probability. In 
this way the assessment of a case recognises that even below the balance of 
probability there is a chance that exposure to occupational ionising radiation 
played a role in the disease. 
 
3.38  During financial year 2011/2012, the Scheme received 13 new claims 
from former Ministry of Defence employees who believe their illness is 
associated with exposure to occupational ionising radiation.  No compensation 
was paid during this period – but some minor payments, totalling £3,043, were 
made in respect of legal fees on ongoing cases.     
 
 
 
 
Asbestos Claims 
 
3.39  Prior to May 1987, Service personnel were prevented by law from 
pursuing claims for compensation from the Ministry of Defence by Section 10 of 
The Crown Proceedings Act 1947 (Crown Immunity prevented claims from being 
made prior to 1947). This point of law applies to all Service personnel and has no 
bearing on rank, status or place of employment. However, Section 10 was 
repealed by The Crown Proceedings (Armed Forces) Act 1987. Since the 
change in the law, which was not made retrospective, Service personnel who 
suffer loss or injury as a result of negligence by the Ministry of Defence have 
 
 23
 
 
 
 

been entitled to make common law claims for compensation. When 
compensation claims are submitted, they are considered on the basis of whether 
or not the Ministry of Defence has a legal liability to pay compensation. Where 
there is a legal liability to pay compensation we do so.   
 
3.40  In the case of members of the Armed Forces being exposed to asbestos 
dust and fibre during service before 15 May 1987, they are prevented by law 
from receiving compensation from the Ministry of Defence. The legal position is 
that even if an ex-Serviceman only now discovers he has an asbestos related 
disease, he cannot sue for compensation if exposure was before the repeal of 
Section 10 of The Crown Proceedings Act 1947. Given that controls over the use 
of asbestos were introduced in 1970, this is, and will be, the case for the vast 
majority of ex-Service claimants (the time between exposure to asbestos dust 
and fibre and the first signs of disease is typically between 15 and 40+ years). 
 
3.41  When Parliament debated the repeal of Section 10, the question of 
retrospection was considered and motions to allow all past and present members 
of HM Forces or their dependants to pursue compensation claims for injury or 
death were moved. They were defeated or withdrawn. The view then, as it is 
now, was that there is no logical point at which to draw a line, short of trying to 
cover all types of injury, and this would create more examples of unfairness and 
injustice. The Government, therefore, has no plans to introduce legislation to 
allow ex-Service personnel suffering illness or injury before 1987 to be paid 
common law compensation.   
 
3.42  Compensation in the form of a War Pension is available, however, to all 
former members of HM Forces suffering from Service attributable illness or 
injury. War Pensions are paid by the Service Personnel Veterans Agency, are 
non-discretionary, not means-tested and are made on a no-fault and 
retrospective basis. They are up-rated annually and are tax-free. The Service 
Personnel Veterans Agency also makes provision for the widows of Service and 
ex-Service personnel whose death is attributable to service in the form of a War 
Widows Pension.     
 
3.43  Former civilian employees, who are not bound by the provisions of 
Section 10 of the Crown Proceedings Act 1947, are, of course, able to pursue 
common law claims for compensation.   
 
 
 
 24
 
 
 
 

 
Section Four 
 
Civilian Staff Employer’s Liability Claims 
 
 
4.1 
Since 1982, the Ministry of Defence has contracted out the handling of its 
civilian employee Employer's Liability claims. Gallagher Bassett International 
Limited is the current contractor and was awarded a new four-year contract to 
handle all newly notified civilian Employer’s Liability claims from 1 May 2012. 
Many of the claims relate to asbestos related illnesses and Noise Induced 
Hearing Loss. 
 
 

 2009/10 
2010/11 
2011/12 
Number of claims received 
560 
599 
666 
Number of claims settled 
732 
1269 
551 
Amount paid (£) 
£20.8M 
£16.6M 
£15.7M 
 
 
1300
20,000,000
15,000,000
800
10,000,000
5,000,000
300
0
09/10
10/11
11/12
-200
09/10
10/11
11/12
Claims received
Amount paid
Claims settled
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 25
 
 
 
 

 
Section Five 
 
Motor Claims 
 
 
Third Party Motor Claims - UK 
 
5.1 
Since 1982 the Ministry of Defence has contracted out the handling of 
claims made against the Department by other road users. Gallagher Bassett 
International Limited is the current contractor and was awarded a new four-year 
contract to handle all newly notified third party motor claims from 1 May 2012.      
 
5.2    CLC&P works closely with the Defence Road Safety Officer to reduce the 
number of road traffic accidents involving Ministry of Defence employees by 
raising awareness of the human and financial costs of accidents. To this end 
CLC&P provides close support to the Defence Motor Transport Policy Group and 
attends the Defence Road Transport Regulation Working Group and the Defence 
Motor Transport Sub-Committee.  
 
5.3     Statistics for motor claims over the last three financial years are shown 
below: 
 
 
 2009/10 
2010/11 
2011/12 
Number of claims received 
1923 
1852 
1674 
Number of claims settled 
2261 
2168 
1946 
Amount paid (£) 
£5.4M 
£5.6M 
£6.7M 
 
 
2500
£6,000,000
1850
1200
£3,000,000
550
-100
£0
09/10
10/11
11/12
09/10
10/11
11/12
Claims received
Claims settled

Amount paid
 
 
 
 
 
 
 

 
 26
 
 
 
 

Third Party Motor Claims - Overseas (not dealt with by ACOs) 
 
 
5.4 
Claims arising from non-UK based vehicles overseas are handled by the 
appropriate ACO or, where the geographical area is not covered by one of the 
ACOs,  by PLT  
 
5.5 
Claims managers are required to establish that an authorised driver was 
driving the Ministry of Defence vehicle on an authorised journey and route. If 
these criteria are met and all the evidence suggests that the Ministry of Defence 
driver was liable for the accident, then compensation will be paid. Statistics for 
overseas motor claims for the last three financial years are shown in the table 
below:   
 
 
 2009/10 
2010/11 
2011/12 
Number of claims received 
25 
16 
17 
Number of claims settled 
20 
15 
11 
Amount paid (£) 
£17,884 
£8,440 
£16,459 
 
 
25
20000
20
15
10000
10
5
0
0
09/10
10/11
11/12
09/10
10/11
11/12
Claims received
Claims settled
Amount paid
 
 
 
 
Uninsured Loss Recovery 
 
5.6    With effect from 1 May 2007 Gallagher Bassett has recovered, on behalf of 
the Ministry of Defence, the cost of damage caused to its vehicles in accidents 
that are the fault of a third party. The number of recoveries made and the 
amounts received are shown below. 
 
 
 
 2009/10 
2010/11 
2011/12 
Number of recoveries 
652 
698 
655 
Amount recovered (£) 
£660,607 
£555,617 
£433,384 
 
 
 27
 
 
 
 

750
500000
250000
600
0
09/10
10/11
11/12
09/10
10/11
11/12
Number of recoveries
Amount Recovered
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
 
 
 
 
 
 28
 
 
 
 

Section Six 
 
Clinical Negligence Claims 
 
 
6.1 
CLC&P handles clinical negligence claims brought by current or former 
members of HM Armed Forces and the small number of claims brought by their 
dependants treated in MOD medical facilities. The number of new claims 
received during 2011/2012 was comparable with the number received in recent 
years.   
 
6.2 
For a claimant to bring a successful clinical negligence case he or she 
must prove a causal link to the injury or illness suffered as well as proving 
negligence. It is not sufficient to prove negligence alone.      
 
6.3 
As observed in previous reports, clinical negligence claims can be very 
time consuming, complex and expensive to settle. Experts in a number of 
different fields may need to be instructed by both parties to provide advice on 
liability, causation and quantum. Finding suitable experts willing to provide 
opinions in such cases within fairly short timescales remains an ongoing 
problem.  
 
6.4 Following 
on 
from 
the significant progress made in the last year or so, a 
further number of long running claims, were successfully resolved during 
2011/12.  
 
6.5 Details 
of 
expenditure 
on clinical negligence cases over the past three 
years are shown below. These figures include cases where allegations have 
been made relating to the failure to recognise, diagnose and treat Post 
Traumatic Stress Disorder (PTSD) from current or former Service personnel.      
 
 
 
 2009/10 
2010/11 
2011/12 
Number of claims received 
61 
59 
62 
Number of claims settled 
38 
21 
18 
Compensation plus cost of 
£14.7M £17.0M £6.7M* 
claims settled (£) 
 
* The overall settlement figure was £8.2M but was reduced to £6.7M to take into 
account £1.5M received from separate NHS Trusts as a  contribution towards 
settlement/legal costs.  
 
 29
 
 
 
 

20000000
15000000
70
60
10000000
50
40
30
5000000
20
10
0
0
09/10
10/11
11/12
09/10
10/11
11/12
Claims received
Claims settled
Amount paid
 
 
 
 
6.6  In addition to the number of formal claims received, the Clinical 
Negligence Team dealt with a number of requests from solicitors for disclosure of 
medical records and other documentation, in anticipation of future clinical 
negligence claims against the Department being submitted.  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 30
 
 
 
 

Section Seven  
 
Area Claims Offices 
 
 
 
Area Claims Office Afghanistan 
 
 
7.1     The Area Claims Office (ACO) is located in Lashkar Gah, the capital of 
Helmand Province, at the Main Operating Base Lashkar Gah alongside HQ Task 
Force Helmand and the FCO Provincial Reconstruction Team. When the security 
situation permits the ACO will visit Forward Operating Bases (FOBs) to assist the 
Military Stabilisation Support Teams (MSST) in their understanding of Claims 
procedures. MSSTs give vital on the ground assistance to the ACO in areas 
where it is difficult for Afghan citizens to travel to Lashkar Gar, due to inherent 
security issues or the distance that they would be required to travel, by taking 
receipt of claims.  They also provide assistance with gathering information and 
forwarding the paperwork to Lashkar Gar for the ACO to assess.  
 
7.2     The level of claims received this year has reduced compared to that of 
previous years. This is an indication of transition as more military operations are 
led by the Afghan National Security Forces with UK troops now acting as 
mentors and advisers. Consequently, the ACO has recently reduced from 3 to 2 
civilian staff (the team now comprises 1 x Band C2 MOD Civil Servant and 1 x 
Locally Engaged Interpreter). 
 
7.3     The types of claims received from Afghan citizens are varied and include 
fatalities and personal injuries (mainly resulting from civilians being caught in the 
cross-fire between ISAF and insurgents), property damage caused by munitions, 
crop damage caused by the movement of military tracked vehicles and a small 
number of road traffic accidents. There has been a recent increase in claims 
relating to the removal of crops/trees or buildings to improve security at UK ISAF 
Check Points and Patrol Bases. 
 
7.4     A total of 650 claims were received of which 545 (including 74 from 10/11) 
were settled at a total of £748,421.  141 claims were repudiated during FY11/12.   
 
 
 
2009/10 2010/11 2011/12 
Number of claims received 
1710 
1743 
650 
Number of claims settled 
969 
1242 
545 
Amount paid 
£1,142,000 £1,440,423  £748,421 
 
 
 
 
 
 31
 
 
 
 

 
Area Claims Office (North West Europe) (ACO (NWE)) 
 

 
7.5 
ACO(NWE) is part of G8, Headquarters British Forces Germany (HQ 
BFG), located at Rheindahlen. The ACO has four civilian staff responsible for 
handling claims by and against the Ministry of Defence in Austria, Belgium, 
Czech Republic, Denmark, France, Germany, Hungary, Luxembourg, Norway, 
Poland, The Netherlands and Switzerland. Claims handled include RTAs, 
Training and Manoeuvre Damage, Public Liability and Loss of Service.  
 
7.6 
The vast majority of ACO(NWE) business, approximately 80% of claims 
received, relates to vehicle movements and is handled in accordance with Article 
8.5 of the NATO Status of Forces Agreement (SOFA). Claims processed under 
Article 8.5 are negotiated by the host Nation, and the costs incurred are 
apportioned between Ministry of Defence and the Host Nation on a 75%:25% 
basis. The host Nation therefore has a vested interest in keeping costs as low as 
possible. 
 
7.7 
ACO(NWE) continues to recover significant sums to the public purse, this 
year it has recovered over £535,000. The sums recovered come mainly from the 
pursuit of claims under German law for MOD incurred expenses where members 
of the forces and/or their dependants have sustained injury as a result of third 
party liability in RTAs. The heads of claim which typically contribute to these 
recoveries are loss of earnings and medical related expenses, such as medical 
treatment costs, ambulance fees and physiotherapy and rehabilitation costs.  
 
7.8 
The Claims Website for both the intranet and internet use, has enabled 
the ACO(NWE) customer base to have a better understanding of its role within 
North West Europe and has ensured that claimants are fully aware of the 
processes in place to action any claims against/for the MOD. This is updated 
regularly with customer information and the new and revised DINS.  
                  
7.9 
ACO(NWE) remains active in promoting the role of the claims office within 
BFG by raising its profile with a view to reducing the number of claims received 
and, more importantly, the associated costs incurred to the GOC HQ BFG 
Budget. ACO action in this area has included briefings and presentations to key 
stakeholders, such as the Schadensregulierungsstelle des Bundes (SRB) and 
the Garrison Transport Office representatives. ACO(NWE are also publicising the 
role of the claims office within the British Forces Germany Newspaper (Sixth 
Sense) and the various Garrison’s Community Bulletins. This is aimed at 
ensuring the customer base has an understanding of the ACO(NWE) 
requirement and continuation of the vital information flow and stakeholder 
support.    
 
 
 
 
 
 
 32
 
 
 
 

 
2009/2010 2010/2011  2011/2012 
Number of claims 
500 402  351 
received 
Number of Claims 
550  
525  
401 
closed 
Total Paid 
£1,164,711 £1,168,176
£1,267,645 
 
Total Recovered 
£679,192  
£662,394 
£535,573 
   
 
 
 
Area Claims Office Cyprus 
 
7.10  Based at Episkopi Garrison in the Western Sovereign Base Area, the Area 
Claims Office Cyprus, staffed by 1 x UKBC C2 and 1 x LEO, is responsible for 
handling all third party claims for compensation made by and against British 
Forces Cyprus, the Sovereign Base Areas and visiting UK forces, which arise out 
of on-duty military activity in the Sovereign Base areas and the Republic of 
Cyprus. The types of claims handled include road traffic accidents, training & 
manoeuvre damage, Public Liability and, for locally employed staff, Employer’s 
Liability.  
 
7.11  The Cypriot climate and terrain continues to provide excellent training 
opportunities for the British forces, in the air and on land and sea, with most land 
based training taking place on privately owned land under access rights afforded 
to the UK by the Cyprus Treaty of Establishment. The majority of the ACO’s work 
continues to involve inspecting and investigating training and manoeuvre 
damage claims arising from land based exercises and associated helicopter 
activity. 96% of all claims received in-year (413 out of 429) were training & 
manoeuvre related and were predominantly for crop damage or loss of livestock.   
 
7.12  There have been a number of units visiting Cyprus to train this year for the 
first time. They have been able to exploit the training facilities on island, 
although, inevitably, a greater use of the facilities has meant that the number of 
claims has increased.  ACO Cyprus is looking at ways to minimise the number of 
claims incurred. It should be noted that the amount paid out for claims during 
2011/12 includes the residual claims resulting from the fire on the training area in 
2009. This accounts for £82,000 of the amount paid. 
    
 
 
2009/10 2010/11 2011/12 
Number of claims received 
172 
154 
429 
Number of claims settled 
116 
156 
334 
Number of claims closed 
140 
179 
358 
Amount 
paid 
£153,422 £456,150 £491,602 
Amount 
recovered 
£13,525 £42,852 £12,481 
 
 
 
 33
 
 
 
 

 
Area Claims Office South Atlantic Islands 
 
7.13  The Command Secretariat in the BFSAI has delegated Functional 
Authority to settle Common Law Claims against the MOD. The ACO in the 
Falkland Islands is responsible for collating all claims for approval or passing 
claims over the value of £5,000 to CLC&P. 
 
7.14  During FY2011/2012 a total of four new claims were received.  
 
7.15  The driving conditions in the Falkland Islands are demanding and in an 
effort to reduce accidents all military Land Rovers have been fitted with engine 
limiters set at a maximum speed of 40 MPH. 
 
 
 
2009/10 2010/11 2011/12 
Number of claims received 



Number of claims settled 



Amount paid 
£1,950 
£646 
£3,654 
Amount Recovered 
Nil 
Nil  
Nil 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 34
 
 
 
 

Section Eight  
 
 

Insurance and Indemnities 
 
 
 

 
Insurance 
 
8.1    Treasury guidelines generally discourage public bodies from insuring risks 
unless it can be shown that the potential costs of claims paid, together with the 
cost of handling such claims, will exceed the cost of purchasing insurance. As 
the costs of premiums, compared to the amounts paid in compensation, would 
normally favour insurance companies, the Ministry of Defence self-insures its 
core business activities. 
 
8.2   CLC&P is the policy lead on all Ministry of Defence non-contractual 
insurance issues and encourages units and establishments to transfer risks 
arising from non-core activities away from the Department. 
 
8.3   Willis Ltd (Aerospace) provides insurance, which is self-financing, to protect 
the Ministry of Defence against claims arising for compensation for five specific 
non-core aviation risks: 
 
•  Military aircraft participation at air displays 
 
•  Civilian aircraft use of military airfields 
 
•  Search and Rescue training with civilian organisations 
 
•  Fare-paying passengers on military aircraft 
 
•  Passengers conveyed for Income Generation purposes  
 
 
Indemnities 
 
8.4   CLC&P is responsible for all non-contractual indemnity matters, ranging 
from issuing indemnities to land owners who are letting the Armed Forces use 
their land for exercises, to commenting on different clauses within Defence 
Infrastructure Organisation’ licenses, indemnity provisions within Memoranda of 
Understanding (MOU) and other international agreements. 
 
 
 35
 
 
 
 

8.5   The Ministry of Defence always seeks an indemnity against claims arising 
from repayment activities or events that do not further the interests of the 
Department. Examples include participation by Service personnel or Ministry of 
Defence civilian staff in non-core fund raising charitable or social activities, or the 
use of Ministry of Defence personnel or equipment by other organisations for 
activities, which have no direct benefit to the Ministry of Defence. The Ministry of 
Defence must seek an indemnity in such instances as there is no financial 
provision in the Defence budget to meet claims, which are not defence related. 
Indemnities must be backed by insurance or a guarantee from those 
companies/organisations that self-insure. The only exception to the requirement 
for indemnity is when the Ministry of Defence is dealing with other Government 
Departments. This is because of the principle of indivisibility of the Crown. 
CLC&P issued about 33 indemnities in Financial Year 2011/12 and commented 
on 33 MOUs. 
 
8.6  Indemnities that arise from the Department’s contractual business are the 
responsibility of the appropriate Commercial Branch, with policy guidance 
provided by the Director General Defence Commercial as appropriate.    
 
 
Income Generation 
 
8.7 
Income generation activity under the Government’s initiative for ‘Selling 
Government Services into Wider Markets’ is also an exception to the rule that the 
Ministry of Defence does not purchase insurance. However, because of the 
unusual and hazardous nature of the activities the Ministry of Defence 
undertakes, commercial insurance may not always be available to cover these 
activities, or may not be cost effective. Therefore, alternatively customers may 
pay a charge under the Departmental Insurance Scheme and any claims for 
compensation, which may arise, will then be settled by CLC&P. 
  
8.8 
Advice about insurance and risk reduction may be obtained from CLC&P 
and from the Ministry of Defence’s insurance brokers, Willis Ltd, in accordance 
with 2010DIN08-018. Willis has developed a specialised package of insurance 
policies offering a full range of business insurances for Top Level Budget 
Holders undertaking income generation activity. 
 
                                                                                                                            
 
 
 
 
 
 
 
 
 
 
                                                                                                                      
 
 36
 
 
 
 

                                   
Section Nine  
 
Law and Practice 
 
 
  
Civil Justice Procedures 
 
9.1 
The greatest upheaval ever in the Civil Litigation process occurred when 
the Civil Procedure Rules were introduced on 26 April 1999. The Rules, which 
replaced the existing High Court and County Court Rules, significantly changed 
the way common law claims are handled, in an attempt to speed up, simplify and 
make the whole process less expensive. The Rules, which include pre-action 
protocols, govern the conduct of litigation and encourage the appointment of a 
single expert to provide an independent opinion. Although these reforms have 
been in place for some time now, we believe it is important to recapitulate the 
main aims and procedures, to serve both as a reminder for regular readers of 
these reports and as a simple digest for those unfamiliar with the subject. 
 
Aims 
 
9.2 
The overriding objective of the rules is to enable the court to deal with 
cases justly in ways, which are proportionate to the amount of money involved, 
the importance and complexity of the case, and to the parties’ financial position.  
 
 
•  Litigation will be avoided wherever possible 
 
•  Litigation will be less adversarial and more co-operative 
 
•  Litigation will be less complex 
 
•  The timescale of litigation will be shorter and more certain 
 
•  Parties will be on a more equal footing 
 
•  There will be clear lines of judicial and administrative responsibility for the 
civil justice system 
 
•  The structure of the courts and the deployment of judges will be designed 
to meet the needs of litigants 
 
•  Judges will be employed effectively so that they can manage litigation in 
accordance with the new rules and protocols 
 
•  The civil courts system will be responsive to the needs of litigants   
 
 37
 
 
 
 

 
9.3 
In keeping with the reforms, the Courts take a proactive approach to case 
management, setting down directions which decide the order in which issues are 
to be resolved and fixing timetables to control the progress of the case. In 
addition, they encourage the parties to co-operate and consider adopting other 
methods of settlement such as alternative dispute resolution.  
 
9.4 Proportionality 
plays 
an important part and the courts will consider 
whether the potential benefit of taking a particular step justifies the cost. 
 
Experts 
 
9.5 
In the majority of cases a single expert will be instructed and evidence, 
assuming the case proceeds to court, will normally be in the form of a written 
report. The defendant and claimant may submit written questions to the expert 
and both sides will see the expert’s response. If the parties to an action cannot 
agree upon an expert witness they may instruct their own choice of expert but, if 
the court decides that either party has acted unreasonably, they will not be able 
to recover the costs of obtaining the expert report. 
 
Pre Action Protocol 
 
9.6 
  Lord Woolf in his final ‘Access to Justice’ report of July 1996 
recommended the development of pre-action protocols ’to build on and increase 
the benefits of early but informed settlement that genuinely satisfy both parties to 
dispute’. The Lord Chancellor strengthened this message in the Foreword of the 
New Civil Procedures Rules when he stated ‘We must not forget, however, that 
we should see litigation as the last resort and not the first resort in the attempt to 
settle the dispute’.  
 
9.7 
  A number of pre-action protocols, including ones for personal injury 
cases and clinical negligence, have been published. Eventually all types of 
litigation will be categorised and, if appropriate, pre-action protocols developed. 
 
9.8     The aims of the pre-action protocol are to promote more pre-action 
contact between the parties, better exchange of information, better pre-action 
investigation and thereby to put the parties in a position to settle cases fairly and 
early, reducing the need for litigation.    
 
9.9    If defendants are unable to comply with the pre-action protocols the courts 
will have the power to impose sanctions due to non-compliance when 
proceedings are commenced. Sanctions will likely include a refusal to grant 
further extensions of time for serving a defence or evidence and costs penalties. 
 
 38
 
 
 
 

Fast-Track and Multi-Track 
 
9.10    Personal injury claims will be assigned to either a fast-track or multi-
track. Fast-track cases were limited to a value up to £15,000, but were increased 
to £25,000 from 6 April 2009 and will proceed to a hearing quickly. 
 
9.11      There will be an automatic timetable for compliance with the various 
stages of the litigation. The hearings are designed to be relatively short and in 
the majority of fast-track cases written evidence only from a single expert will be 
accepted. 
 
9.12  Multi-track cases currently will generally involve claims with a value in 
excess of £25,000 or which feature complex issues. Case management by the 
courts will play an important part in setting the timescales for certain stages of 
the case and defendants may possibly be required to attend a case conference 
before a judge, when decisions will be made as to the future conduct of the 
claim. 
 
9.13     The personal injury pre-action protocol sets out the following stages: 
 
Letter of Claim 
 
9.14   The letter of claim will contain a clear summary of the facts on which the 
claim is based, including allegations of negligence, and will include details of any 
injuries suffered or financial losses incurred.  
 
Defendant’s Reply 
 
9.15   The defendant should acknowledge within 21 calendar days of the date of 
posting of the letter of claim in Personal Injury cases and fourteen calendar days 
in Clinical Negligence cases. 
 
Claim Investigation 
 
9.16   The defendant will have a maximum of three months from the date of 
acknowledgement of the claim to investigate ( four months in the case of Clinical 
Negligence claims due to their complexity ). No later than at the end of that 
period the defendant must inform the claimant, or their legal representative, 
whether liability is admitted in full, is denied, or there is a partial admission. If the 
defendant denies liability they should enclose with the letter of reply documents 
material to the issues between the parties, and which would be likely to be 
ordered to be disclosed by the court. If a defendant is unable to comply with the 
requirements of the pre-action protocol, the claimant will be able to issue 
proceedings at the end of the three-month period. 
 
9.17   If the defendant makes a proper denial of liability giving the detailed 
explanation and documents required under the protocol, many cases will 
proceed no further. In such cases it will be for the claimant to make a decision 
whether to proceed with the case. 
 
 39
 
 
 
 

 
9.18   Defendants will no longer be able to delay making a decision as to 
whether to settle or fight and they will no longer be able to make a simple blanket 
denial of liability without giving reasons. 
 
Proceedings  
 
9.19   There will be a strict timetable for dealing with the Defence. In the majority 
of cases the time limit will be 28 days after proceedings are served. One 
extension of time may be granted, although in circumstances where the 
defendant has failed to comply with the pre-action protocol, it is very unlikely that 
any extension will be given. 
 
9.20    The Defence must also fulfil new requirements under the rules. The new 
requirements are as follows: 
 
•  the Defence must state which facts are admitted; 
 
•  the Defence must state which facts are denied and provide supporting 
documentary evidence; 
 
•  the Defence must state the defendant’s own version of events; and  
 
•  the Defence must identify which facts the defendant is unable to admit or 
deny and which the claimant is required to prove. 
 
Statement of Truth 
 
9.21   Under the rules a Statement of Truth must verify the Defence. The form of 
the statement is as follows: 
 
‘The defendant believes that the facts stated in this defence are true.’ 
 
The statement is not sworn, but must be signed by: 
 
•  a senior officer of the company, corporation or organisation; 
 
•  a partner in control of a business; or 
 
•  a legal representative. 
 
9.22   The person signing the statement of truth must identify his or her office or 
position in the organisation. It follows that the person signing must have authority 
to sign on behalf of the organisation. If a legal representative signs, he or she is 
deemed to have explained the consequences to the defendant and the penalties 
are the same as if the defendant had signed. 
 
 40
 
 
 
 

9.23    A person who signs without honest belief in the truth of the Defence is 
guilty of contempt of court. In an extreme case this could result in a fine or even 
a prison sentence for the person who approved the contents of the Defence and 
authorised its signature. 
 
9.24   It follows that solicitors will always ask the defendant either to sign the 
Defence or to approve the contents of the Defence before signing on the 
defendant’s behalf. If the Defence is not signed the court will strike it out and the 
defendant will lose his or her opportunity to defend the claim. 
 
9.25   Bearing in mind the tight time schedules, the Department needs to be in a 
position to deal with the Defence quickly. In the case of claims against the 
Ministry of Defence, the appropriate persons to sign the Statement of Truth or 
verify the Defence will be the Head of CLC&P or a Senior Claims Officer. 
 
Disclosure  
 
9.26   The Civil Procedure Rules specify the type of documents, which the 
defendant must disclose and set time limits for doing so. Many of these 
documents will have been disclosed under the pre-action protocol: i.e. within the 
initial three-month period for investigation. 
 
9.27   Under the rule, standard documents to be disclosed include: 
 
•  all documents which could adversely affect the case;  
 
•  all documents which could adversely affect the other side’s case; and 
 
•  all documents which could support the other party’s case. 
 
9.28   A defendant is required to make a reasonable search for documents 
depending on: 
 
•  the significance of the document; 
 
•  the number of documents; 
 
•  the complexity of the case; and  
 
•  the ease and expense of retrieval. 
 
Disclosure Statement 
 
9.29   The list of documents which is sent to the other side will include a 
disclosure statement containing the following information: 
 
•  the identity of the person making the statement; 
 
•  the extent of the search that has been made to trace documents; 
 
 41
 
 
 
 

 
•  why the person signing the statement is the appropriate person; 
 
•  confirmation that he or she understands the duty to disclose; and 
 
•  confirmation that that duty has been carried out to the best of his or her 
ability. 
 
9.30   There will clearly be an onus on the defendant to make sure that the 
documents can be obtained quickly and that they are up-to-date. The person 
who signs the disclosure statement or who authorises the solicitor to sign it on 
the defendant’s behalf, must understand his or her duty and have the appropriate 
authority within the organisation. 
 
9.31   The implementation of the reforms involved a massive change in working 
practices. At the outset, and indeed some time before the changes took place, 
Claims officials undertook additional specialist training to ensure they would 
comply with the rules. Updating and refresher courses and workshops have been 
undertaken during the last year. The acquisition of new and specialist skills has 
been recognised in the CLC&P Functional Competence Framework.    
 
9.32   Units and Establishments have also become far more aware of how the 
protocols and rules operate. Claims officials will continue to work closely with, 
and remind, Units and Establishments of their duties to co-operate in supplying 
information and assisting in defence of claims.  
 
9.33   Accidents must be reported promptly and accurately with improvements 
made to document handling and availability. 
 
9.34   Witnesses must be identified and made available for interview early in the 
claims process. Similarly, defendants will need to be able to identify and find 
relevant documents. 
 
9.35   The courts will not be sympathetic to the Department arguing that there 
has been insufficient time to investigate a claim. Neither will the courts deem the 
Department to be a special case because of its size, widespread locations or the 
deployment of key witnesses overseas.  
 
 
Legal Services Commission (Legal Aid) 
 
9.36   It is over 60 years since the Legal Aid and Advice Act was enacted. For 
the first time, it gave access to justice to a range of people who beforehand could 
not afford to bring a case in criminal or civil law. Eligibility for legal aid depended 
on the applicant’s disposable income and capital but anecdotal evidence is 
plentiful about how legal aid was wrongly or rightly distributed and it therefore 
came as no surprise that Legal Aid for Personal Injury claims was abolished in 
April 2000. The majority of such claims are now likely to be the subject of a 
 
 42
 
 
 
 

conditional fee whereby a claimant’s solicitor can uplift his normal charging rate 
by up to 100% if successful.  
 
9.37   Conditional fees can cause problems for Claims officials when trying to 
estimate the legal costs element of settling a claim. One method of overcoming 
this problem is to ask the claimant’s solicitor to clarify the basis of funding the 
costs together with an indication of the success fee agreed. However, as the 
rules stand, solicitors are not obliged to provide this information to the Defendant 
and to do so might give an indication of the strength of their client’s case. In 
many cases, therefore, the level of the success fee will not be known until after 
the case has settled. 
 
9.38   In these cases there will be a far greater opportunity to recover our legal 
costs because as part of the conditional fee arrangements a claimant will likely 
take out insurance to protect against the risk of losing the action and to provide 
an indemnity for the defendant’s legal costs. It will therefore be our practice, and 
the practice of our commercial claims handlers, to pursue claimants with 
conditional fee arrangements for our costs, in the event that we are successful in 
the defence of the claim 
 
9.39     A small number of claimants still however manage to obtain Legal Aid to 
pursue their claims. In some cases the claimant may at some point wish to 
discontinue his/her claim for whatever reason. In these circumstances the 
Department’s legal advisers will always strongly advise against trying to recover 
costs in the High Court. The Legal Aid Act 1988 governs this area. The Legal Aid 
Act prevents a defendant from recovering any money against a legally aided 
person without the leave of the Court. In deciding whether to order payment of 
costs, the Court will decide whether payment is likely to cause undue "financial 
hardship" to the legally aided person. The fact that a claimant is in receipt of 
legal aid, already means they are technically within this category or they would 
not have qualified for Legal Aid in the first place. 
 
 
Dispute Resolution Commitment   
 
9.40   In accordance with a pledge made to the then Lord Chancellor Alternative 
Dispute Resolution (now rebadged as Dispute Resolution Commitment) is 
considered in all appropriate cases, usually where there is some evidence to 
support a claim of negligence.  This may take the form of counsel-to-counsel 
Settlement conference or Mediation (see explanations below). In cases where 
there is currently no evidence it is not deemed appropriate. 
 
9.41  In financial year 2011/12, there were 103 cases where Dispute Resolution 
Commitment led to settlement of the claim either directly or indirectly. This 
resulted in estimated savings to the Department of some £32 Million (£26 Million 
in respect of the actual claims and estimated savings of £6 million in respect of 
legal costs).   
   
 
 
 
 43
 
 
 
 

 
 
Counsel-to-Counsel Settlement Conferences 
 
9.42   In cases where liability is not an issue, counsel-to-counsel settlement 
conferences are an innovative and financially attractive way of settling cases 
without going to trial or settling at the courtroom door. A round table consultation 
is arranged with the Department represented by counsel, the instructing solicitor 
and either Head of CLC&P, Senior Claims Officer or an appropriate Team 
Leader.. This method of negotiated settlement has had a significant effect on the 
way claims are handled due to the claimant and defendant showing an element 
of goodwill combined with a realistic approach. This has demonstrated that it is 
possible to agree a settlement without recourse to the courts. An added benefit is 
that the claimant need not undergo the trauma of a court case to secure 
compensation for an injury or loss caused by the Department’s negligence. 
  
 
Mediation 
 
9.43  Mediation is a route strongly favoured as the way forward for civil justice in 
the UK, for cases where there is some evidence to support a claim. The 
Department is signed up to mediation as a method of Dispute Resolution 
Commitment, but as the then Lord Chancellor’s Department’s Press Notice on 
the subject made clear, the Dispute Resolution Commitment is not appropriate in 
every case. Judges are also now directing parties to an action to mediate the 
case rather than letting it proceed to court.    
 
9.44  The mediation process employs an independent person (the mediator) to 
facilitate negotiations between parties in a dispute in an effort to reach a mutually 
accepted resolution. The process is voluntary, flexible, confidential and non-
binding, and can be entered into and terminated at the discretion of either party. 
A number of claims made against the Ministry of Defence have been 
successfully concluded through the mediation process. 
 
9.45  The Head of CLC&P, Senior Claims Officer (Claims Handling) and Team 
Leader Clinical Negligence claims are accredited mediators. 
 
 
Contributory Negligence  
 
9.46   Where a person suffers an injury, partly as a result of his own fault and 
partly the fault of another person, any subsequent claim for damages he pursues 
may be reduced to reflect his contribution to the cause of the loss. This principle 
is governed by the Law Reform (Contributory Negligence) Act 1945. 
 
9.47    The following are some examples of Contributory Negligence: 
 
•  Driver or pedestrian failing to keep a proper lookout 
 
 
 44
 
 
 
 

•  Claimant failing to turn off a machine before cleaning it 
 
•  Failure of motorcyclist to wear a crash helmet 
 
•  Failure to wear seat belt while travelling in a vehicle 
 
•  Riding in a vehicle as a passenger with a driver who is known to be under 
the influence of alcohol or drugs.  
 
9.48   The claimant’s lack of care must be a contributory factor to his injury. 
However, some concession is made towards children and towards people 
suffering from some infirmity or disability who are unable to be held responsible 
for their own actions.  
 
Rehabilitation  
 
9.49   Rehabilitation, as a method of assisting injured or ill people back to work, 
is a matter that is attracting an increasing level of support amongst various 
bodies in Government, the Judiciary and the legal profession. It is claimed that at 
present the UK’s track record in getting injured or ill people back to work falls well 
behind that of other Western countries.   
 
9.50 CLC&P aims to utilise rehabilitation where appropriate when compensation 
claims are made. Rehabilitation is expected to assume far greater prominence in 
the claims handling process.  
 
Fraud  
 
9.51 Although the Ministry of Defence self-insures its core risks, and 
compensation payments are made directly from the Defence budget, the risks 
posed by fraudulent claimants are as real for the Department as they are for the 
insurance industry. Claims staff are therefore alert to the possibility of fraud, or 
grossly exaggerated claims, and, as part of the process of determining liability for 
the claim, critically assesses the information provided by claimants.   
 
9.52  Surveillance might be undertaken to observe the true extent of a claimant’s 
alleged injuries in cases where there is reasonable suspicion about the veracity 
of a claim. Claims that are found to be exaggerated are either repudiated or 
settled at a greatly reduced level of damages in line with the injury suffered and 
true level of loss incurred by the claimant.   
 
9.53 Cases where investigations suggest that claims are substantially 
exaggerated, fraudulent throughout, or relate to wholly contrived or fabricated 
incidents are, as a matter of course, passed to the Ministry of Defence Fraud 
Squad with a view to proceeding with a criminal prosecution.    
 
 
 
 
 45
 
 
 
 

Periodic Payments  
 
9.54  The traditional method of payment following settlement of a compensation 
claim has been by the payment of a single lump sum. If prudently invested, this 
would provide a stream of income representing loss of future earnings and/or the 
need for continued care for the anticipated remainder of the claimant’s life.   
 
9.55   A periodic payment normally consists of a conventional lump sum to the 
claimant together with a regular payment made on a monthly, quarterly or annual 
basis. The periodic payment can be made by way of an annuity purchased in the 
marketplace or, in the case of Government Departments and the National Health 
Service Litigation Authority, on a self-funded basis. There are currently 42 cases 
where  periodic payment arrangements have been put in place.     
 
9.56   With the implementation of the Courts Act on 1 April 2005, the Courts now 
have the power to impose periodic payment settlements and must consider in 
every case, involving future pecuniary loss, whether periodical payments are a 
suitable means to pay all or part of the damages 
 
9.57   The changes have been introduced to ensure a guaranteed income 
stream for those facing long-term care needs and future loss of earnings. The 
Court will also have the power to make a variable order to alter the terms of the 
periodic payment in cases where the claimant suffers some serious deterioration 
or, indeed, significant improvement. In a landmark case of Thompstone v 
Thameside & Glossop Acute Services NHS Trust
 the health authorities appealed 
against the first instance decisions that periodical payments in respect of future 
care be indexed in accordance with the Annual Survey of Hourly Earnings 
(ASHE 6115) rather than RPI. The Court of Appeal considered the 
circumstances in which it would be appropriate to award some part of the 
damages due to the Claimants on a periodical payments basis and also gave 
consideration to the appropriate index to be applied if different from RPI. The 
Court of Appeal ruled that indexation for future care costs on the basis of the 
ASHE 6115 were appropriate. This ruling will make such payments considerably 
more expensive for Defendants.  
 
 
 
2009/10 2010/11 2011/12 
Total number of periodic payments 
28 
35 
42 
Total payments each year £1,574,188 £1,566,674 £2,416,117 
 
9.58  The rise in payments 2011/12  is largely due to new settlements agreed in 
year, however it should also be noted that those claims settled using the ASHE 
index rates to calculate annual adjustments to payments  have seen a decrease 
in their payments this year, as the ASHE rates have unexpectedly decreased 
from 2010 levels.         
 
 
 
 
 46
 
 
 
 

Third Party Accident Scheme (ToPaS) 
 
 
9.59   If Ministry of Defence Civil Servants or Service Personnel are injured in 
any type of accident caused by a third party (e.g. a member of the public or a 
contractor) whilst they are on duty, it is the individual’s own responsibility to 
pursue a common law claim for compensation against that third party without any 
assistance or involvement by the Department. The reason for this is that the law 
does not recognise the Department’s involvement in such cases and therefore 
the Ministry of Defence does not have authority to incur expenditure in such 
circumstances. The only exception to this is that Civil Servants injured in road 
traffic accidents can have their legal costs underwritten by their TLB but this does 
not apply to Service Personnel or to Civil Servants injured in other 
circumstances. 
 
9.60   In order to alleviate these concerns, a scheme called ToPaS (Third Party 
Accident Scheme) has been in operation since November 2000, which provides 
legal advice and assistance to Ministry of Defence Civil Servants and Service 
Personnel who have been injured whilst on duty and who consider the injury to 
be the fault of a negligent third party. Ralli Solicitors, a firm of solicitors who 
specialise in personal injury claims, operates the scheme on behalf of the 
Ministry of Defence. The scheme works on a conditional fee basis (commonly 
known as “no-win, no-fee”). This means that any legally sustainable claim that 
Ministry of Defence personnel submit to Ralli will be free of charge to the 
individual. If the claim is successful, in addition to the compensation that has 
been paid, all legal costs including any money that has been paid for by Ralli will 
be recovered separately from the party at fault. If the claim is unsuccessful there 
will no charge to the Ministry of Defence or to the individual concerned, as the 
costs will be borne by an insurance policy that is placed and paid for by Ralli.  
 
9.61    Generally, ToPaS will offer free advice and a help line for victims of 
accidents abroad, who should in the first instance call 0161 8326131. There are 
many occasions when, although the accident occurred abroad, a claim can still 
be made within the UK and appropriate compensation can be recovered. On the 
other hand, Ministry of Defence personnel who suffer injury as a result of the 
negligence of a foreign national when abroad may need to obtain the services of 
a local lawyer. ToPaS can assist in locating a suitable legal representative in 
such circumstances. 
 
9.62   Under the Fifth EU Motor Insurance Directive a claimant who is resident 
(“domiciled”) in England and who has been injured in a road traffic accident in 
another EU country, may issue court proceedings against the foreign third party 
in an English County Court or the High Court. Claimants have the choice of 
issuing court proceedings in their home court or, alternatively, in the country in 
which the accident occurred. 
 
9.63    Since May 2004 hundreds of unit visits/meetings have been conducted 
using the opportunity to brief key unit personnel, discuss how to advertise the 
scheme and hand out ToPaS information packs and posters. Without doubt 
presentations have been the most effective way of getting this important 
 
 47
 
 
 
 

message across to all Ministry of Defence personnel, and they have also 
provided an ideal opportunity for questions and feed back. The response from 
those units who have made contact has been excellent. Enquiries have come 
from Canada, the South Atlantic Islands, Germany, Northern Ireland and from 
across mainland UK. Should you require further information regarding ToPaS, or 
you would like to arrange either a short briefing or presentation, or you wish to 
make a claim under the scheme then please contact: 
 
Gillian Nuttall 
Public Relations & Marketing Manager  
Ralli Solicitors 
16/17 Ralli Courts 
West Riverside 
Manchester  
M3 5FT 
                                         
Tel: 0161 6150730 
Mobile: 07930 375360 
E-mail: xxxxxxx.xxxxxxx@xxxxx.xx.xx or   Website: www.topas.org.uk 
 
 
 
 
 
 

                                                                                                                            
                                      
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 48
 
 
 
 

Annex A 
 
Common Law Claims & Policy - Organisation  
 
   
   
Head of CLC&P - SCS 1 
 
 
Senior Claims Officer (Claims Handling) - Band B2 
 
Responsible for Employer’s Liability Team, Public Liability Team and Clinical 
Negligence Team. 
 
 
Employer’s Liability, Low Flying and Maritime Team  
 
Staff: 
 
 
Team Leader 
Band  C2 
2 Case Managers  
Band  D 
1 Assistant Case Manager  
Band  E1 
 
Responsibilities: 
 
Service Personnel Employer's Liability Claims 
Handling of novel, contentious, complex or sensitive Service personnel and ex-
Service personnel Employer's Liability claims. Managing the claims handling 
contract with Gallagher Bassett International Ltd. 
  
Civilian Personnel Employer's Liability Claims 
Managing the claims handling contract with Gallagher Bassett International Ltd. 
 
Combat Immunity Claims 
Claims relating to service in Iraq and Afghanistan in which it is open to MOD to 
plead a defence of combat immunity where injury was sustained engaging the 
enemy in the course of hostilities. 
 
Nuclear Test Veterans Group Action 
Claims from veterans of the Nuclear Tests undertaken in the 1950s and 1960s in 
respect of the alleged health problems suffered by them, their children and 
grandchildren, said to have resulted from their participation in the tests. 
  
Section 10 claims 
Claims from members of the Armed Forces barred by Section 10 of the Crown 
Proceedings Act 1947. 
 
 
 
 49
 
 
 
 

Miscellaneous claims 
 
 
Miscellaneous claims from Service and ex-Service personnel including defective 
enlistment, false prosecution, and unlawful detention. 
 
 
Low flying 
Claims relating to military low flying activity in England, Scotland, Wales and 
Northern Ireland. 
 
 
Maritime claims 
Maritime claims including accidents, salvage, collisions and damage to fishing 
gear. 
 
 
Public Liability Team  
 
Staff: 
 
Team Leader 
Band  C2 
2 Case Managers  
Band  D 
2 Assistant Case Managers   
Band  E1 
                     
 
Responsibilities:  
 
Public Liability Claims 
Public Liability claims, including personal injury, property damage and Iraqi 
detention cases.   
 
Visiting Forces 
Claims against visiting forces in the UK (under Section 9 of the Visiting Forces 
Act 1952 and Article VIII of the NATO Status of Forces Agreement). 
 
Northern Ireland Claims 
Politically sensitive claims from members of the public arising from the activities 
of the HM Forces in Northern Ireland.     
 
Vehicle Claims 
Privately owned vehicle damage claims and road traffic accidents overseas in 
countries not covered by an ACO. 
 
Overseas Operations 
Claims policy relating to overseas operations and advice to ACOs in Afghanistan, 
Cyprus, Iraq, NW Europe, and the South Atlantic Islands. 
 
Compensation Scheme for Radiation Linked Diseases 
 
Claims for compensation due to illness alleged to have been caused by 
exposure to radiation. 
 
 
 50
 
 
 
 

Criminal Injuries Compensation 
Criminal injuries compensation claims from MOD Civil Servants’ dependants 
based overseas. 
 
Non-Maritime Recoveries 
Recovery of MOD’s uninsured financial losses, excluding those arising from 
traffic accidents in the UK. 
 
 
 

 
Clinical Negligence Team     
 
Staff: 
 
 
 
Team Leader 
Band  C2 
2 Case Managers  
Band  D 
1 Administrator  
Band  E2 
                       
 
 
Responsibilities:  
 
Clinical Negligence 
Claims for compensation from Service personnel and their dependants where it 
is alleged that the MOD has acted negligently.  
 
Post Traumatic Stress Disorder  
Claims from Service and ex-Service personnel alleging failure of the MOD to 
recognise, diagnose and treat their PTSD. 
 
Locally Engaged Civilian Claims  
Claims from Locally Engaged Civilians in Iraq that allege MOD acted negligently 
as a result of which they suffered harm.  
 
Human Volunteer No Fault Compensation Scheme  
Ex-gratia payments made under the human volunteer research no-fault 
compensation scheme. 
 
Claims Annual Report  
Responsibility for production of the Claims Annual Report.     
 
 
Senior Claims Officer (Policy) - Band C1 
 
Responsible for Policy Group 
 
Staff: 
 
 
 
 51
 
 
 
 

1 Indemnities & Insurance Adviser  
Band  D 
1 Policy & Contracts Adviser  
Band  D 
1 Finance Officer  
Band E1  
 
 
Responsibilities: 
 
 
Non-contractual Insurance 
Non-contractual insurance (principally non-core aviation risks), including liaison 
with MOD’s insurance brokers, indemnities and the claims aspects of MOUs. 
 
Third Party Motor Claims 
Policy relating to third party motor claims and liaison with AXA Corporate 
Solution Services Ltd and Gallagher Bassett International Ltd. 
 
Contractual Matters 
Liaison with contractors working for CLC&P and the MOD’s commercial branch 
on contractual issues. 
 
Financial Management 
Bill paying for CLC&P and management of periodic payments 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
 52
 
 
 
 

Annex B 
 
Top 10 Cases Settled  
2011/12 
 
Claimant 
Type of Injury 
Compensation*  
/Loss 
Service 
Exposure to Asbestos 
£1,678,411 
 
 
Service 
Clinical Negligence  - 
£1,600,000** 
failure to diagnose  and 
treat tumour 
 
Service 
Clinical Negligence – 
£1,100,000 000 lump 
Negligent treatment of 
sum plus annual 
high blood pressure 
periodical payments**
 
Service 
Clinical Negligence – 
£1,000,000 
Negligent treatment of 
leg injury – leading to 
amputation 
 
Service 
Whole body vibration 
£987,451 
syndrome 
 
Service  
Claimant was a  
£880,797 
passenger  in vehicle 
involved in a Road 
Traffic Accident 
 
Civilian 
Clinical Negligence – 
£850,000 lump sum 
Brain Damaged Child.  
plus annual 
Cerebral Palsy 
periodical payments 
 
Service Personal 
injuries 
£845,000 
sustained after 
explosion on Navy 
vessel 
 
Service 
Fatality after helicopter 
£600,000 
crash 
  
Service 
Noise Induced Hearing 
£525,000 
Loss 
 
*    Inclusive of claimant’s legal costs 
**   Relevant NHS Trusts also made significant financial contributions(£500K+         
      in each case) to settlement of these claims   
 
 
 53
 
 
 
 

 
 
Hard copy Distribution List      
 
 
APS/Secretary of State  
 
APS/Minister (AF) 
 
APS/Minister (DEST) 
APS/Minister (ISS) 
APS/Minister(DPWV) 
APS/USofS 
 
 
Parliamentary Branch 
DCDS (Ops) 
 DCDS 
(Pers) 
MA/CDS  
Surgeon General 
CNS  
CGS CinC 
Fleet 
CAS 
CinC Naval Home Command 
 CinC 
Land 
 
CinC Air Command  
PS/PUS AG 
PS/VCDS CGS-Army 
Inspector 
 
PS/CSA  
DG Operations & Policy  
 
DG Finance  
DG Transformation 
 
DGDC 
 
 
 
DBR-D 
External:       
DJEP-D 
Treasury Solicitor (5 copies) 
DMC (5 copies) 
Crown Solicitor (3 copies) 
CLS-D 
Gallagher Bassett (5 copies)  
Head of AMD Med Legal 
Morton Fraser Solicitors (3 copies) 
CESO(Navy) 
Beachcroft LLP (5 copies)  
CESO(Army) 
Berryman Lace Mawer (5 copies) 
CESO(RAF) 
Kennedys Solicitors (Chelmsford) 
CESO(PJHQ) 
Willis Ltd 
CESO(DE&S) 
CESO(Central TLB)  
 
 
 
 
 
 
 
 
 54
 
 
 
 

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