(To watch the full press conference with sign language interpretation, click here.)

The Law Reform Commission today recommended that the court should be given, by way of legislation, the power to make periodical payment orders (PPOs) in respect of damages for future pecuniary loss in personal injury cases.

Under the current law in Hong Kong, the court awards pecuniary damages in personal injury cases in a lump sum. The claimant’s past and future losses are assessed once and for all into a compensation determined at the date of the hearing or agreement.

In determining the compensation, the court must consider what a plaintiff might have earned without the injury, the plaintiff’s earning capacity after the injury and any additional expenses incurred following the injury.

The commission said in its report that this conventional approach to quantify future losses has been generally criticised as being imprecise and unscientific. In a Court of First Instance case, the judge also pointed out the option of making periodical payments as an alternative to the conventional way of assessing damages for future pecuniary loss.

In addition to giving PPOs, the commission recommended that the Financial Secretary should be empowered to formulate and promulgate the presumed net rates of return on investment, which is also known as the discount rate. The rate should be subject to periodic review once every six years, and the Financial Secretary should consult an expert panel for each review.

The power of the court to award periodical payments should be limited to catastrophic cases, the commission noted.

Besides, irrespective of the consent of the parties to the proceedings in respect of future pecuniary loss, periodical payments should be referable to care and accommodation cost. However, without contravening the aforesaid, the payment should cover all heads of future pecuniary loss, subject to the consent of the parties to the proceedings.

Additionally, the original PPOs should be open to review by the court under certain circumstances.

These include changes in the need for future care as a result of significant medical deterioration or improvement, which is foreseen at the time of the original order, provided that specific criteria pertinent to the nature of deterioration or improvement, as well as the duration during which a review can be applied for, are stipulated in the PPO.

The review should be restricted to only one application, subject to extension of time for the application as the court may allow in appropriate circumstances, the commission added.

Furthermore, the commission suggested that the court should have a discretion to make a PPO after taking into account the security of the periodical payments to ensure the continuity of payments and satisfying itself that a PPO is able to secure the full scope of the plaintiff’s award.

PPOs ought to be introduced by way of legislation as soon as practicable, the commission urged, adding that further refinement can be made after implementation for stakeholders to build readiness.