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The Problem of the Class Differentiation of Disability Benefits: A Case for Going Beyond the No-Fault Principle

Published online by Cambridge University Press:  12 February 2016

Arye L. Miller
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Extract

In Israeli law eighteen statutes now regulate the legal status of various kinds of disabled persons. These statutes apply to about twice the number of different categories of disabled persons, classified in groups or classes, according to the cause and circumstances of disablement. Ignoring voluntary arrangements, the number of legal statuses or classifications (i.e. the complex of legal rights, pecuniary and in specie, together with the conditions of entitlement) may be put at eleven, which includes groups of people disabled de facto who are not recognised as disabled under law since they do not come within the statutory definition of disablement or otherwise meet the conditions of entitlement. The number of statuses is smaller than the number of statutes because some of the latter merely extend the application of other statutes in pari materia.

If we address ourselves to the substance of the legal status of these disabled persons, the general impression obtained reflects a kind of order of preference among the different groups, sometimes with considerable gaps. At the lowest level are the most deprived, the de facto disabled, who lack all rights as such, and the ordinary disabled (those who do not fall into any specific category but are recognised as disabled—the “new” and “long-standing” invalids of Chapter 6B of the National Insurance Law (Consolidated Version), 1968, in respect of whom a paucity of rights exists, in the nature only of ultimum subsidium. At the upper level stand the most preferred groups under existing law, traffic-accident victims and disabled soldiers.

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Israel Law Review , Volume 12 , Issue 4 , October 1977 , pp. 434 - 465
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Copyright © Cambridge University Press and The Faculty of Law, The Hebrew University of Jerusalem 1977

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References

1 For the relevant statutes in this field and their application, the different groups of disabled, their classification and rights, the conditions of entitlement, as well as the absende of consistency and uniformity in the law, see Proccacia, U. and Miller, A.L., The Rights of the Disabled in Israel: Basic Issues (Jerusalem, 1974, in Hebrew).Google Scholar [In determining the number of statuses, long-standing and new disabled under Chapter 6B of the National Insurance Law, 1968, are treated as separate categories.]

2 Social Security Programs Throughout the World (U.S. Department of Health, Education and Welfare, 1975); most of the comparative data presented below without any indicated indices are taken from this source.

3 Zelenka, A., Les pensions dans les pays industrialisés (Genève, 1974) 56, 64.Google Scholar

4 “USSR: Development of Social Security in 1973” (1974) 109 Int. Lab. R. 380.

5 See Roter, R., Impressions of a Study Tour in Switzerland, Norway and Sweden (National Insurance Institute, Jerusalem, 1974, in Hebrew) IV.Google Scholar

6 See Olea, M. Alonso, “Prevention and Compensation of Employment Injury in Spanish Legislation” (1975) 111 Int. Lab. R. 411 at 419–420.Google Scholar

7 Higuchi, T., “The Special Treatment of Employment Injury in Social Security” (1970) 102 Int. Lab. R. 109, 123Google Scholar: “If social security, inspired by principles of equity and universality, is to realise the aspiration of all people for effective protection against the contingencies inherent in the societies they live in, discrimination between occupational and non-occupational accidents will have to disappear, for otherwise the term ‘Social Security’ itself may come to sound ironical and meaningless”. Cf. Zelenka, op. cit. supra n. 3, at 59.

8 “Social Security in the Netherlands” (1970) 23 Int. Soc. Sec. R. 11; Veldkamp, G., “The Coherence of Social Security Policy” (1973) 108 Int. Lab. R. 357.Google Scholar

9 On this Act and its preparation see especially: Mathieson, D.L., “Compensation for Personal Injury in New Zealand” (1968) 31 Mod.L.R. 544CrossRefGoogle Scholar; Szakats, A., “Compensation for Personal Injury: Individual Liability or Collective Responsibility” (1969) 3 Tasmanian U.L.R. 204Google Scholar; Matheson, J.M., “Compensation for Personal Injury in New Zealand: The Woodhouse Report” (1969) 18 I.C.L.Q. 191CrossRefGoogle Scholar; Szakats, , “Reform of Personal Injury Compensation: The White Paper on the Woodhouse Report” (1970) 4 N.Z. Univ. L.R. 139Google Scholar; McKenzie, , “Report of the Committees” (1971) 34 Mod. L.R. 542CrossRefGoogle Scholar; Palmer, G.R., “Abolishing the Personal Injury Tort System: The New Zealand Experience” (1971) 9 Alberta L.R. 169Google Scholar; Palmer, G.R. and Lemons, E., “Towards the Disappearance of Tort Law: New Zealand's New Compensation Plan” (1972) U.IU.L.F. 639Google Scholar; Palmer, , “Compensation for Personal Injury: A Requiem for the Common Law in New Zealand” (1973) 21 A.J.C.L. 1CrossRefGoogle Scholar; Marks, K. H., “A First in National No-Fault: The Accident Compensation Act 1972 of New Zealand” (1973) 47 Austr. L.J. 516Google Scholar; “The Gair Report: Advance or Retreat” (1973) N.Z.L.J. 438; “Accident Compensation Bill”, ibid.; “New Zealand: New Accident Compensation Act” (1974) 27 Int. Soc. Sec. R. 387; Cochrane, D. J., “Personal Injury by Accident” (1974) V.U.W.L.R. 277Google Scholar; Harris, D. R., “Accident Compensation in New Zealand: A Comprehensive Insurance System” (1974) 37 Mod.L.R. 361CrossRefGoogle Scholar; Kidner, R., “New Zealand: A New Approach to Personal Injury Compensation” (1974) 124 N.Z.L.J. 442Google Scholar; Franklin, M., “Personal Injury Accidents in New Zealand and in the United States: Some Striking Similarities” (1975) 27 Stan. L.R. 653CrossRefGoogle ScholarPubMed; Vennel, Margaret A., “The Scope of National No-Fault Accident Compensation in Australia and New Zealand” (1975) 49 Austr. L.J. 22.Google Scholar

10 See Wryell, M., “Income Security—the Future” (1974) 27 Int. Soc. Sec. R. 507Google Scholar; Current Topics (1974) 48 Austr. L.J. 413; Vennel, (see preceding note); Tune, A., “L'indemnisation des dommages corporels et des incapacités physiques et mentales: un project australien” (1975) 2 Droit Social 133Google Scholar; Keeler, J.F., “Report of the National Committee of Inquiry into Compensation and Rehabilitation in Australia” (1975) Adelaide L.R. 121.Google Scholar

11 See supra, n. 9.

12 See for example O'Connell, J., “Expanding No-Fault Beyond Auto Insurance: Some Proposals” (1973) 59 Virg. L.R. 749, 809–812.CrossRefGoogle Scholar

13 See Ducyroux, J. J., Droit de la sécurité sociale (6th ed., Paris, 1975) 439, noteGoogle Scholar; Higuchi, supra n. 7, at 124.

14 See supra n. 4.

15 According to the Pension Law of 1966.

16 See the text supra at nn. 9 and 10.

17 See Dupeyroux, supra n. 13, at 435, note; Spiclmeycr, G., Ascertaining Entitlement to Compensation for an Industrial Injury (General Report) (Brussels, 1965) 41Google Scholar; Higuchi, supra n. 7, at 110–113.

18 See Higuchi, supra n. 7, at 113.

19 Schottland, Ch. J., The Social Security Program in the United States (2nd ed., New York, 1970) 128.Google Scholar

20 Beveridge, W., Social Insurance and Allied Services (London, 1942) 39, para. 81.Google Scholar

21 Ibid.

22 This ground is pointed out by Spielmeyer, see supra n. 17, at 42; Higuchi, see supra n. 7, at 112–113, and P. Durand as cited by the latter. For further details, see The Financial Aspects of Insurance Against Employment Accidents, International Social Security Association, Report XV, (Geneva, 1974) 20.

23 Calabresi, G., The Costs of Accidents (1970).Google Scholar

24 See Posner, R. A., Economic Analysis of Law (1972) 78.Google Scholar

25 See Higuchi, supra n. 7, at 124–125; cf. Windeyer, V., (1961) 35 Austr. L.J. at 149Google Scholar: “We live in an insurance age, we live in a motorized and mechanical age. People are suffering from accidents which are part of the hazards of the times we live in; they arise not out of and in the course of our employment but Out of and in the course of our daily lives.”.

26 In order to be able to judge the dimensions of this factor, we would like to mention that, for instance, in the United States, the Consumer Products Safety Commission tells us that 20 million Americans are injured each year by products other than automobiles. See Freedman, W., “No-Fault and Products Liability: An Answei to a Maiden's Prayer” (1975) Insurance Law Journal 199 at 200.Google Scholar

27 Cf. Atiyah, P.S., Accidents, Compensation and the Law (London, 1970) 481–482Google Scholar: “Insofar as society could avoid or minimize diseases by taking steps within its capacity, but which it finds it expedient not to take, e.g., because it prefers to spend the money on submarines or travelling to the moon, it would be perfectly sensible to say that society is the cause of those diseases, just as much as it is the cause of the accidents which may occur in the process of building the submarines or going to the moon.”

28 The principle that “a bird in the hand is worth two in the bush”, can be epitomised, see Freedman, supra n. 26, at 202.

29 For an extended consideration of this repeal, see Ison, T.G., The Forensic Lottery: A Critique on Tort Liability as a System of Personal Injury Compensation (London, 1967).Google Scholar See also infra nn. 36, 49, and 88, and the text after n. 46. A further reason against subrogation, of a pragmatic nature, is that even in cases of intention or gross negligence, as experience in Sweden (where the right has been abolished) shows, the bother of investigating the victim's right to tort damages has not been worth the comparatively small sums collected. See O'Connell, supra n. 12, at 809. Cf. Procaccia, Uriel, “Denying Subrogation in Personal Injury Claims: A Needed Change of Direction” (1973) 15 William and Mary L.R. 93.Google Scholar In contrast, Prof. I. Englard, who has suggested solving the question of compensation to traffic accident victims within the framework of national insurance, but is opposed to maintaining the subrogation rights of the National Insurance Institute, advocates that a claim in tort for the balance of damages be retained: Englard, I., Automobile Accident Compensation System (Jerusalem, 1972, in Hebrew).Google Scholar

30 See Atiyah, supra n. 27, at 479: “For instance, much bronchitis is caused by industrial smog, cancer by smoking, and countless diseases are spread by the fact that people are brought into contact with one another in public transport and work places as a result of the way in which society organizes itself”.

31 Ibid., at 489.

32 Such as sport accidents, where causation is composite and includes negligence by external factors which should have been concerned with proper safety conditions for the activity involved. Two recent cases reported in the newspaper Ha-Aretz (date unknown) may be mentioned: that of a young German tourist bitten by a shark whilst sea bathing not far off-shore at Eilat and severely injured as a result, and that of a student who fell down the stairs at school and was injured. In both cases, it is interesting, the injured persons actually received considerable compensation, one from Eilat Municipality and the other from the Ministry of Education, within the framework of tort law.

33 The same applies to the new Israel enactment, the Road Accidents Victims' Compensation Law, 1975, S.H. no. 5735, p. 234, where the said rule rests on an express provision in sec.2(c) as an exception only regarding injury caused intentionally or as result of a criminal act (sec. 7).

34 See Beveridge, supra n. 20, at 39, para. 80.

35 See Higuchi, supra n. 7; Veldkamp, supra n. 8; Henderson, R. C., “Should Workmen's Compensation be Extended to Non-Occupational Injuries” (1969) 48 Texas L.R. 117Google Scholar; cf. Malone, , “Damage Suits and the Contagious Principle of Workmen's Compensation” (1952) 9 NACCA L.J. 20.Google Scholar

36 We have the Israel sources in mind. See Lotan, G., “Full Cover for Accidents and Disablement within the Framework of National Insurance” (1973) 4 and 5 Social Security (in Hebrew) 117 at 123–124Google Scholar; Englard, supra n. 29. The same position was taken by the Ben Ze'ev Committee in its Report of 1966 in also recommending a complete break with notions of personal liability in this field, see Inter-Ministerial Committee Report on Questions of Traffic and Work Accidents (1966) 1 Is.L.R. 636 at 649.

37 O'Connell, & Simon, , “Payments for Pain and Suffering: Who Wants What, When and Why?” (1972) U.Ill.L.F. 1.Google Scholar

38 See Jaffe, Louis L., “Damages for Personal Injury: The Impact of Insurance” (1953) 18 Law and Contemporary Problems 219CrossRefGoogle Scholar; O'Connell, supra n. 12; idem, “Elective No-Fault Liability Insurance for All Kinds of Accidents: A Proposal” (1973) Insurance L.J. 495; idem, “It's Time for No-Fault for All Kinds of Injuries” (1974) 60 A.B.A.J. 1070.

39 Freedman, supra n. 26, at 206–207.

40 Elliot, D.W. & Street, H., Road Accidents (1968) 242 ff.Google Scholar

41 Blum, & Kalven, , “Public Law Perspectives on a Private Law Problem—Auto Compensation Plan” (1964) 31 U. Chi. L.R. 641CrossRefGoogle Scholar: “The merits of solving the auto accidents problem through Social Security cannot be appraised within the provincial borders of the traditional tort view point”.

42 See Tunc, supra n. 10, at 133–134; Higuchi, supra n. 7, at 124.

43 Fleming, J., “The Columbia Study of Compensation for Automobile Accidents: An Unanswered Challenge” (1969) 50 Colum. L.R. 408 at 415.Google Scholar

44 See Ison, supra n. 29, at 55, 58 ff.

45 See Atiyah, supra n. 27, at 611–615; cf. Kidner, supra n. 9.

46 Franklin, M.A., “Replacing the Negligence Lottery: Compensation and Selective Reimbursement” (1967) 53 Virginia L.R. 774.CrossRefGoogle Scholar

47 See, for instance, section 113 of the New Zealand Accident Compensation Act. A rare exception is found in English law and in some other countries where those injured in work accidents are also entitled to flat rate benefits.

48 See, for instance, Winfield, , On Torts (London, 1967) 676 ff.Google Scholar; Salmond, , The Law of Torts (1969) 765 ff.Google Scholar; and especially Mazeaud, H. L. and Tune, A., Traité théorique et pratique de la responsabilité civile délictuelle et contractuelle (Paris, 1957) vol. 1, pp. 32–33Google Scholar, and (1960) vol. 3, p. 5 ff.

49 A writer who sees abolition of claims for damages for personal injuries as highly desirable expresses, however, reservation to cases of injury caused by intentional torts or by breach of contract, see Vennel, supra n. 9; see also supra n. 29.

50 See Palmer, “Compensation for Personal Injury: A Requiem for the Common Law in New Zealand” supra n. 9, at 2 and 44.

51 As regards pain and suffering, the parallel development in the communist world and in the capitalist world in recent years is interesting. In the Soviet Union and other East European countries, in contrast to the previous absolute non-recognition on ideological grounds of compensation for pain and suffering, there are signs of a growing tendency to adopt the idea of limited compensation for personal injury which has no economic consequences, at least in the most dramatic cases (see for example Miller, L., “Din Problematica elaborarli unui nou cod al mundi” (1969) 14 Studii si cercetari juridice 101 at 115–116Google Scholar). In the West, where in the past pain and suffering were treated as one of the holy cows of tort law, we are witnessing today a move towards the position that at best compensation for pain and suffering must be largely curtailed (see, for instance, Henderson, O'Connell, Simon, Jaffe, Freedman, Atiyah, Ison, Franklin, supra nn. 26, 27, 29, 35, 37, 38 and 46). Hence in this area a situation may in time arise where the two ideological opponents will follow a closely similar middle course.

52 As regards the reason for and against a means test, see Procaccia, and Miller, , “The Means Test as a Quantitative Criterion of Benefits to the Handicapped” (1975) 8 Social Security (in Hebrew) 50.Google Scholar This article does not refer to the new institution of community responsibility. We may note that the resolution on “Compensation for physical injury or death”, adopted in 1975 by the Committee of Ministers of the Council of Europe enforces the principle: “Compensation is to be calculated without regard to the victim's financial situation” (section 12).

53 The possibility of paying compensation in the form of pensions is also dealt with by the Resolution of the Council of Europe (sections 7–8), see preceding note.

54 See Atiyah, supra n. 45, at 485–486.

55 The reference here is to benefits due to disabled soldiers and other groups to whom the Invalids (Pension and Rehabilitation) Law (Consolidated Version), 1959, (13 L.S.I. 315) hereinafter cited as the Invalids (Pensions and Rehabilitation) Law, applies, as well as to the generally disabled under Chapter 6B of the National Insurance Law (Consolidated Version) 1968 (22 L.S.I. 114) hereinafter cited as the National Insurance Law. All of these receive flat rate benefits and so the question posed in the text arises—what is the justification for equality in these areas alone?.

56 See Ison, supra n. 29, at 18.

57 Cf. Ison, supra n. 29, at 6, 57, 107–108.

58 For instance, Goldberg, M., National Insurance (1974, in Hebrew) 207–236Google Scholar; Levy, R., Lewis, T. & Martin, P., Social Welfare and the Individual, Cases and Materials, (New York, 1971) 462–506.Google Scholar Of the case law regarding the entitlement of disabled soldiers we need mention only one judgment in which the Supreme Court held that an injury caused in doing something which was forbidden or in the cause of wrongful behaviour may serve as cause under the Invalids (Pension and Rehabilitation) Law, and that an injury caused in a fight between two soldiers, even where the injured soldier initiated the fight or contributed towards it, will entitle the victim to the same benefit as that which a soldier injured on military service receives, provided he can prove any causal nexus between his service and the fight: Elian v. Pensions Officer (1974) (I) 30 P.D. 87. Thus under a Law which retains the condition of causation this is the test to separate out those cases where everything is given from those where almost nothing is given. The judgment was reversed on Further Hearing ((1975) 31 P.D. 398) and it was held that the very fact that the petitioner was injured in a place and at a time in service he may claim under the Law even if the fight had no connection with military service.

59 See, e.g., Kretzmer, , “No-Fault Comes to Israel” (1976) 11 Is.L.R. 288 at 296–298Google Scholar, who mentions the famous case of Bourhill v. Young (1943) A.C. 92, and other nervous shock cases and discusses difficult causation questions in this field.

60 On this whole problem see Kretzmer, D., “The Malpractice Suit: Is it Needed?” (1973) 11 Osgoode Hall L.J. 55.Google Scholar

61 As was done by Larson, , The Law of Workmen's Compensation (New York, 1972) 1.Google Scholar

62 For the same reason the same rule will apply in Israel (specific cause of disablement) to those injured in the conditions prescribed by the above-mentioned Invalids (Pensions and Rehabilitation) Law, as concerns disabled servicemen, Invalids (War against the Nazis) Law, 1954 (8 L.S.I. 62), Invalids (Nazi Persecution) Law, 1957 (11 L.S.I. 111), Police (Invalids and Fallen) Law, 1955 (9 L.S.I. 80), Prison Service (Invalids and Fallen) Law, 1960 (14 L.S.I. 32), Knesset Building and Precincts Law, 1968 (22 L.S.I. 226), Defence Service Law (Consolidated Version), 1959 (13 L.S.I. 328), Civil Defence Law, 1951 (5 L.S.I. 72), Victims of Hostile Action (Pensions) Law, 1970 (24 L.S.I. 131), Life-Saving Operations (Soldier Casualties) (Benefits) Law 1965 (19 L.S.I. 314), Fire-Fighting Services Law, 1959 (13 L.S.I. 215), Border Victims (Benefits) Law, 1956 (11 L.S.I. 19) and the Life-Saving Operations (Casualties) (Benefits) Law, 1965 (19 L.S.I. 314).

63 See Henderson, supra n. 35, at 117.

64 Until 1975 no-fault automobile accident compensation systems were adopted in 25 states of the U.S.A. See Tune, A., “L'indemnisation des dommages corporels accidentels” (1975) Rev. Int. Droit Comparé 157.Google Scholar

65 A. Conard, Book Review (1971) U.Ill.L.F. 351.

66 See Kidner, supra n. 9, at 442; cf. Atiyah, supra n. 27, at 470 ff.; Ison, supra n. 29.

67 See Franklin, supra n. 46; cf. Windeyer, supra n. 25.

68 “Current Topics” (1974) 48 Austr. L.R. 415; cf. Jaffe supra n. 38.

69 See Conard, supra n. 65; Ehrenzweig, A., “A Psychoanalysis of Negligence” (1953) 47 Nw. U. L.R. 855 at 869Google Scholar; Kidner, supra n. 9, at 442.

70 Among the opponents of no-fault, see Eckhardt, , “No-Fault Legislation Lacks Human and Equitable Answers” (1971) Trial 43Google Scholar; cf. Berg, & Kilby, , “Motor Vehicle Accident Compensation in Ontario” (1974) 13 Ontario L.R. 125Google Scholar; Marks, supra n. 9.

71 See Blum & Kalven, supra n. 41, at 708.

72 See O'Connell, supra n. 12, at 808.

73 See Harper, and James, , Torts (1965) § 13–5, pp. 775–776.Google Scholar

74 “The abolition of liability for damages for personal injuries is unlikely to produce any worsening of the problem of accident prevention, and indeed … the situation might well be improved”, Ison, supra n. 29, at 94.

75 See Calabresi, supra n. 23, at 239 ff.

76 See Calabresi, , “Optimal Deterrence and Accidents” (1975) 84 Yale L.J. 656.CrossRefGoogle Scholar See also Calabresi, supra n. 23 on “Case by Case versus Category Determination”.

77 In the same spirit, Ison argues that “The cause of the disablement is relevant only for the purpose of deciding how the cost of compensation should be borne. For this purpose it is infinitely more efficient to allocate the cost by the use of national statistics and by social insurance methods than by an enquiry into cause in each case” (supra n. 29, at 108).

78 See Section 73 of the Accident Compensation Act.

79 See Franklin, supra n. 46, at 781.

80 See Calabresi, supra n. 23.

81 Cf. Kretzmer, D., Aims and Functions of the Tort System of Loss Allocation (1974) 415Google Scholar, who speaks of the possibility of adopting a two-tier system, the first for determining the compensation and the second the cause of the injury.

82 See Atiyah, supra n. 27, at 578 on Blum & Kalven and at 584 on Conard and his colleagues.

83 Ibid., at 545–600, especially at 599–600.

84 See Blum & Kalven, supra n. 41, at 709–710.

85 See O'Connell, supra n. 12, at 811–812.

86 See sec. 38 of the National Insurance Law.

87 Bilski, R., Enber, D. and Shafar, G., “The Rights of Released Soldiers after the War of October 1973: Buying Political Quiet or Achieving Social Justice?” (1975) 7 State, Government and International Relations (in Hebrew) 120.Google Scholar

88 Likewise in connection with all the reasons given by Beveridge, see Henderson, supra n. 35, at 141.

89 A similar solution is adopted by the Road Accidents Victims' Compensation Law, 1975, sec. 8 (supra n. 33) unless the injured party was injured in an accident caused intentionally by another. This exception merits separate examination. See also supra nn. 29 and 36.

90 A condition like this is also to be found in the Dutch law mentioned above and in the law of West Germany (Zumutbarkeit) in respect of pension insurance for loss of occupational capacity.

91 Under the Traffic Accident Victims Compensation Law the latter two items of compensation are for some reason combined under a common name—compensation for non-pecuniary loss. On the other hand under the Regulations made under the Law for calculating compensation for non-pecuniary loss, in 1976, this double compensation is fixed exclusively by standard criteria (period of hospitalisation and degree of disablement), which does not seem to be justified if the special character of pain and suffering is considered.

92 See Beveridge, supra n. 20, at 39–40, para. 84.

93 For more details, see Englard, supra n. 29; idem, “The Bill of the Traffic Accidents Victims Compensation Law” (1974) Mishpatim 436. For the facts about the possible reduction of cost, see Ben-Vered, E., “A Proposal to Compensate Traffic Accident Victims at Half-price” Haaretz of 23 November 1976.Google Scholar