Maintenance of action - Assignment of right of action - Claimant appealing

Simpson v Norfolk & Norwich University Hospital NHS Trust: CA (Civ Div) (Lord Justices Maurice Kay (vice-president), Moore-Bick, Dame Janet Smith): 12 October 2011

C underwent treatment as a patient at the defendant NHS trust’s hospital. He alleged that in the course of that treatment he developed an infection caused by methicillin resistant staphylococcus aureus (MRSA) as a result of the hospital’s negligent failure to exercise proper infection control.

He commenced proceedings against the hospital claiming damages for personal injury in the sum of £5,000. The claimant’s husband contracted an infection due to MRSA on an earlier occasion while a patient at the same hospital. He died of cancer and, although it had nothing to do with MRSA, the claimant was of the view that the infection rendered his last days more difficult than would otherwise have been the case. After his death the claimant, as his personal representative, brought an action against the hospital claiming damages for personal injury.

She alleged that the infection had been caused by the hospital’s failure to take all reasonable care to prevent the infection. The claim was settled without any admission of liability on the part of the hospital. C and the claimant entered into a deed of assignment under which C purported to assign his claim against the hospital to the claimant in consideration of the payment of £1.

The claimant pursued the proceedings in her own name and for her own benefit and the claim form was amended to increase the amount claimed to £15,000. The hospital applied to strike out the claim under Civil Procedure Rule 3.4 on the grounds that the claimant had no legitimate interest in the claim and that the assignment was therefore void as being contrary to public policy. The district judge allowed the application and struck out the claim. He held that a claim of that kind was incapable of assignment. The claimant appealed to the county court.

The judge identified two points for consideration: whether a claim such as that in the instant case was inherently incapable of assignment, and, if not, whether the claimant had a sufficient interest in C’s claim to enable a valid assignment to her to be made. He held that the assignment was void because the claim was of a personal nature and incapable of assignment, but he also held that even if the claim was capable of assignment, the claimant did not have an interest in it of a kind necessary to support a valid assignment. He therefore dismissed the appeal, but gave C an opportunity to apply within a limited time to proceed with the action in his own name rather than have it struck out altogether. The claimant appealed.

The issues were: (i) whether it was possible to assign a cause of action in tort for damages for personal injury; and, if so, (ii) the circumstances in which such an assignment would be held void for reasons of public policy. The appeal would be dismissed.

(1) There was no reason in principle why a right to receive compensation for personal injury caused by negligence could not properly be regarded as a legal thing in action. It was established law that some choses in action were not capable of assignment, that included choses in action that were considered to be essentially personal in nature. The critical question was whether the identity of the person to whom the obligation was owed was an essential aspect of it.

Although the right to recover damages for personal injury depended on proof of a wrongful act or omission causing harm to the person of the claimant, the obligation to pay compensation, which arose by operation of law, was not one that was personal in the sense that it depended upon the identity of the claimant. It was, therefore, difficult to see that the nature of the obligation itself could be affected by an assignment to a third party (see [7]-[9], [12], [29]-[30] of the judgment).

In the instant case, the judge had been incorrect to have struck out the claim on the grounds that the claim was personal and therefore incapable of being assigned to her (see [12] of the judgment).

(2) It was well established that the law would not recognise, on the grounds of public policy, an assignment of a bare right to litigate, that was, a right to litigate unsupported by an interest of a kind sufficient to justify the assignee’s pursuit of proceedings for his own benefit. Moreover, the assignment of a cause of action for the purposes of enabling the assignee or a third party to make a profit out of the litigation would generally be void as savouring of champerty (see [15], [29]-[30] of the judgment).

The instant case was a case of an assignment of a bare right of action, in the sense that it was an assignment of a claim in which the assignee had no legitimate interest and it was, therefore, void. The claimant did not have an interest in C’s claim of a kind that the law should or did recognise as sufficient to support an assignment of what would otherwise be a bare right of action and was therefore guilty of wanton and officious intermeddling with the disputes of others.

The assignment in the instant case plainly savoured of champerty, given that it involved the outright purchase by the claimant of a claim which, if it were to succeed, would lead to her recovering damages in respect of an injury that she had not suffered. Whether in those circumstances she chose to transfer all or part of the money to C would be entirely a matter for her, but nothing in the agreement obliged her to do so.

She would not be required to hold any damages recovered in respect of pain and suffering and loss of amenity on trust for C since, if the assignment were effective, it would operate to transfer the whole of his interest in the property represented by his cause of action to her (see [23], [28]-[30] of the judgment).

The assignment was invalid. Therefore, the appeal would be dismissed and the claim would remain struck out (see [28]-[30] of the ­judgment).

Simon Redmayne (instructed by Godfrey Morgan Solicitors) for the claimant; Jeremy Morgan QC ­(instructed by Kennedys Law) for the defendant.