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The remarriage discount

Legislation recently passed by Parliament ends an outdated law that affects a spouse’s claim for damages for wrongful death.

The Wrongs Act 1958 (Vic) enables the dependants of a deceased to sue the person who negligently causes the death of their loved one. The Act allows dependants (often the wife and children) to claim damages based on the financial support they would have gained from the deceased had he or she survived. In quantifying an amount of damages, the court is required to award an amount “proportioned to the injury resulting from such death”. In attempting to arrive at a fair amount for damages, courts consider various factors in each case and allow for general contingencies in life (often referred to as the ‘vicissitudes of life’) that can affect the amount to be awarded. One of the contingencies considered is whether or not the spouse has remarried or there is a likelihood of remarriage. It is claimed that the remarriage factor is relevant in assessing damages because of the possibility of a wife (and her children) being financially looked after in another relationship, thereby reducing her “‘injury” and, therefore, damages in the wrongful death claim. Cases where spouses have remarried provide factual evidence that may affect a claim in damages, but difficulties arise where there has been no remarriage. Should a court consider a spouse’s prospects of remarrying in the future by taking into account her age, physical appearance and demeanour and, if favourable, discount the damages payable?

In a recent High Court case, De Sales v Ingrilli [2002] HCA 52, the court considered whether a separate discount for the prospect of remarriage should apply. In that case, the deceased, who was 31, died as a result of the negligence of another. Liability was not in dispute in the case. The deceased’s wife, aged 27 at the time of his death, claimed damages for herself and her two young children. The wife had not remarried in the nine years since her husband’s death and the time of the trial. In awarding damages, the trial judge did not apply any discount for the general “vicissitudes of life” but did apply a separate discount of five per cent to allow for the possibility of remarriage by the wife in the future. On appeal to the Full Court, the remarriage discount was increased from five per cent to twenty per cent. The wife appealed to the High Court and the case law relating to the remarriage discount was considered. The seven judges of the High Court presented differing views on the validity of a remarriage discount; some regarding it as purely speculative, misleading or inappropriate, while others found it a relevant part of the general ‘vicissitudes of life’ considerations but not, of itself, warranting a separate discount. In the end, the original discount of five per cent was held by the majority of the court to be a reasonable reduction in the case.

The Victorian government has now settled the issue with new legislation. The Wrongs (Remarriage Discount) Act 2004, which came into operation on 28 April 2004, inserts new provisions into the Wrongs Act providing that no reduction be made to damages awarded in claims for wrongful death on the basis of remarriage or prospects of remarriage. Remarriage is expressed to include “de facto relationships” or “domestic partnerships” under the Property Law Act 1958.

Hopefully, the operation of these new legislative provisions will lessen confusion in wrongful death claims and operate more fairly for surviving family members who seek compensation under the law.