Social Security Act 1989

Recovery from damages etc of sums equivalent to benefit

22 Recovery of sums equivalent to benefit from compensation payments in respect of accidents, injuries and diseases

(1) A person (the “compensator”) making a compensation payment, whether on behalf of himself or another, in consequence of an accident, injury or disease suffered by any other person (the “victim”) shall not do so until the Secretary of State has furnished him with a certificate of total benefit and shall then—

(a) deduct from the payment an amount, determined in accordance with the certificate of total benefit, equal to the gross amount of any relevant benefits paid or likely to be paid to or for the victim during the relevant period in respect of that accident, injury or disease;

(b) pay to the Secretary of State an amount equal to that which is required to be so deducted; and

(c) furnish the person to whom the compensation payment is or, apart from this section, would have been made (the “intended recipient”) with a certificate of deduction.

(2) Any right of the intended recipient to receive the compensation payment in question shall be regarded as satisfied to the extent of the amount certified in the certificate of deduction.

(3) In this section—

• “benefit” means any benefit under—

  (a)

  the Social Security Acts 1975 to 1988, or

  (b)

  the Old Cases Act,

  and the “relevant benefits” are such of those benefits as may be prescribed for the purposes of this section;

• “certificate of total benefit” means a certificate given by the Secretary of State in accordance with Schedule 4 to this Act;

• “certificate of deduction” means a certificate given by the compensator specifying the amount which he has deducted and paid to the Secretary of State in pursuance of subsection (1) above;

• “compensation payment” means any payment falling to be made (whether voluntarily, or in pursuance of a court order or an agreement, or otherwise)—

  (a)

  to or in respect of the victim in consequence of the accident, injury or disease in question, and

  (b)

  by or on behalf of a person who is, or is alleged to be, liable to any extent in respect of that accident, injury or disease,

  and includes, in particular, so much of the payment as represents reimbursement for costs incurred in procuring it, but does not include benefit or an exempt payment;

• “compensator”, “victim” and “intended recipient” shall be construed in accordance with subsection (1) above;

• “costs”, in relation to proceedings in Scotland, means expenses;

• “payment” means payment in money or money’s worth, and cognate expressions shall be construed accordingly;

• “relevant period” means—

  (a)

  in the case of a disease, the period of 5 years beginning with the date on which the victim first claims a relevant benefit in consequence of the disease; or

  (b)

  in any other case, the period of 5 years immediately following the day on which the accident or injury in question occurred;

  but where before the end of that period the compensator makes a compensation payment in final discharge of any claim made by or in respect of the victim and arising out of the accident, injury or disease, the relevant period shall end on the date on which that payment is made whether or not any subsequent payment falls to be made in respect only of taxed costs.

(4) For the purposes of this section the following are the “exempt payments”—

(a) any small payment, as defined in paragraph 4 of Schedule 4 to this Act;

(b) any payment made to or for the victim under section 35 of the [1973 c. 62.] Powers of Criminal Courts Act 1973 or section 58 of the [1980 c. 62.] Criminal Justice (Scotland) Act 1980;

(c) any payment to the extent that it is made—

(i) in consequence of an action under the [1976 c. 30.] Fatal Accidents Act 1976; or

(ii) in circumstances where, had an action been brought, it would have been brought under that Act;

(d) any payment to the extent that it is made in respect of a liability arising by virtue of section 1 of the [1976 c. 13.] Damages (Scotland) Act 1976;

(e) without prejudice to section 6(4) of the [1979 c. 17.] Vaccine Damage Payments Act 1979 (which provides for the deduction of any such payment in the assessment of any award of damages), any payment made under that Act to or in respect of the victim;

(f) any award of compensation made to or in respect of the victim by the Criminal Injuries Compensation Board under section 111 of the [1988 c. 33.] Criminal Justice Act 1988;

(g) any payment made in the exercise of a discretion out of property held subject to a trust in a case where no more than 50 per cent. by value of the capital contributed to the trust was directly or indirectly provided by persons who are, or are alleged to be, liable in respect of—

(i) the accident, injury or disease suffered by the victim in question; or

(ii) the same or any connected accident, injury or disease suffered by another;

(h) any payment made out of property held for the purposes of any prescribed trust (whether the payment also falls within paragraph (g) above or not);

(j) any payment made to the victim by an insurance company within the meaning of the [1982 c. 50.] Insurance Companies Act 1982 under the terms of any contract of insurance entered into between the victim and the company before—

(i) the date on which the victim first claims a relevant benefit in consequence of the disease in question; or

(ii) the occurrence of the accident or injury in question;

(k) any redundancy payment falling to be taken into account in the assessment of damages in respect of an accident, injury or disease.

(5) The Secretary of State may by regulations provide that any prescribed payment shall be an exempt payment for the purposes of this section.

(6) Except as provided by any other enactment, in the assessment of damages in respect of an accident, injury or disease the amount of any relevant benefits paid or likely to be paid shall be disregarded.

(7) Schedule 4 to this Act shall have effect for the purpose of supplementing the provisions of this section; and this section shall have effect subject to the provisions of that Schedule.

(8) This section and that Schedule shall apply in relation to any compensation payment made after the coming into force of this section to the extent that it is made in respect of—

(a) an accident or injury occurring on or after 1st January 1989; or

(b) a disease, if the victim’s first claim for a relevant benefit in consequence of the disease is made on or after that date.