Ta'ari v Shell Company (Pacific Islands) Ltd [2000] SBHC 22; HC-CC 322 of 1999 (23 May 2000)

HIGH COURT OF SOLOMON ISLANDS

Case No 32299

TA’ARI and OTHERS

–v-

SHELL COMPANY (PACIFIC ISLANDS) Ltd and OTHERS

Solomon Islands High Court
(Registrar Chetwynd)

Hearing 2^nd May 2000
Ruling 23^rd May 2000

Mr. Nori for all the Plaintiffs
No appearance or attendance for the Defendants

Registrar Chetwynd: This is an application in respect of the damages paid to several infants by the Shell Company and Others. The damages were paid into Court as the result of an agreement between the parties. All sides were represented by lawyers and so I am not being asked to comment on the adequacy of the damages. In simple terms what appears to have happened is that sometime in 1997 each of the infant Plaintiffs were burnt, some quite horribly, when kerosene being used for domestic lighting or cooking exploded. The settlement was without admission of liability by the Defendants.

As the result of the settlement a total of $129,000.00 falls to be divided amongst the plaintiffs in differing amounts ranging from $13,000 to $55,000. I have to decide how that money should be practically distributed. I have to remember that the money belongs to the Children it is to compensate them for the injuries they have suffered. I am also conscious of the fact that during their infancy those same Children will be cared for by parents.

How best then to ensure that the money is used for the Children and to better their life. I bear in mind that we are not talking of huge sums of money. In comparison to other awards I have seen in other jurisdictions for similar injuries they are very small sums (but as I have said I am not being asked to decide on the adequacy of the payments). Inflation will erode the awards quite quickly and it is difficult to invest such small sums and ensure that the principal is protected from inflation. Added to that is difficulty caused by the fact that the Children and their parents live in isolated areas. They do not have easy access to banking facilities.

In my opinion then a mechanism has to be found that will release some money to the Children during the currency of their infancy to, in crude terms, pay for their upkeep and at the same time that same mechanism must protect the bulk of the award.

The Children are of varying ages. I see they are aged from 5 to 14. The older Children may need more money spent on them for such things as schooling and the principal sum will need protecting for a shorter period. What I would propose to do then is make an order that the different amounts are paid for each child into a named bank account. The most sensible thing to do would be to allow the Magistrate in Auki to “control” the accounts, in other words the account would be in the names of the Principal Magistrate Auki and the respective next friend as Trustee for each Child but with the proviso that the Magistrate would have the final say on the question of any payment out of the funds. The account would, of course, be an interest bearing account.

I would also propose that the Child or it’s parent be entitled to take the interest earned on that sum and a portion of the principal sum. For Children over the age of 13 I would suggest that a maximum of 10% of the award be paid out during any one year. This would be about 5% of the principal and the interest of 5%. For a child of the age of 12 or less I would limit the payment to 5% per year. My reasoning is that if 10% is deducted in the last 5 years of the “Trust fund” the amount paid to the child on reaching majority will be at least 50% of the total. Interest paid should actually protect more of the fund but even if no interest were paid then as I say, the child would get 50% of the award. With younger children the 5% limit would protect the fund generally in that interest payments at that rate are probably achievable.

Finally, I would propose that a certain amount of discretion be vested in the Magistrate to pay out larger sums should they be necessary. My proposal is a that the Magistrate could, in extraordinary circumstances, and in respect of a Child over 13 or apparently over 13, authorise a payment out to a maximum of 20% in any one year until such time as the fund is reduced to 50% of the total sum originally invested after which any further payments will only be made if they are sanctioned by this Court. For a Child or Children aged 12 years or less the maximum would be 10% until the fund reached 75% of it’s total. If more money was needed over and above those figures then an application could be made in any event to this Court.

Given the circumstances of this case I will not immediately make an order incorporating the proposals above. I will allow Mr. Nori to approach his clients and seek their views. It is probably best if I therefore adjourn this application to Wednesday 28^th June at 1:30PM. If, however, in the meantime Mr. Nori obtains instructions which indicate that the Next Friends are in broad agreement with my proposals then I will not insist that anyone attends on 28^th June and will be happy to draft an order before that date.

Dated this day of 2000

R.D.Chetwynd
Registrar High Court