What is a Periodic Payments Order?
A structured settlement or periodic payment order is a financial agreement in a medical negligence or personal injury claim. The claimant, rather than by way of a lump sum receives payment through periodic payments. The concept originated in Canada and were first used in a settlement for children who were survivors of the drug Thalidomide. Structured settlements are prevalent in the US where the government has supported this approach to personal injury and medical negligence litigation for more than 25 years.
Structured settlements are commonly used where the child has been the victim of medical negligence or personal injury leading to birth injuries or cerebral palsy. One of the key issues with a lump sum settlement, particularly in the case of a child, is that it is difficult to know if the lump sum will adequately cover medical and living expenses for the rest of the child’s life.
The main benefit of a structured settlement is that there is a series of payments over the life of the child to cover medical expenses, care requirements and living expenses. For instance, a child with cerebral palsy requiring cerebral palsy treatment will require care, medication, surgery, speech, physical and occupational therapy all depending on the level of their disability. A structured settlement or period payment order would seem a logical solution to ensuring the child is given the optimum quality of life taking their condition into consideration.
What’s the Irish Government doing about Periodic Payments Orders?
In 2010 a Working Group on Medical Negligence and Periodic Payments was set up. A primary issue that was to be addressed was whether certain categories of damages for catastrophic injuries could or should be awarded by way of structured settlements or periodic payment orders. In a report in October 2010, the difficulties associated with the current once off lump sum payment procedure were addressed and proposals for legislative reform were recommended. The wheels of justice grind slowly. It was not until January 2013 the Minister for Justice, Equality and Defence, Mr. Alan Shatter TD announced that the Government had approved proposals to prepare legislation. This legislation will enact procedures that would give the Courts new powers to make periodic payment orders for the benefit of persons catastrophically injured through the negligence of others.
In our next article on periodic payments we will explore the Working Group’s recommendations and how they would work towards a more desirable system of compensation that is better able to meet future need of the victims of medical negligence and personal injuries. If you would like to speak to a solicitor regarding a personal injury or medical negligence matter please phone us at 01-8744422 or click here to email us.
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