(The Honourable Justice Blue, The Honourable Justice Stanley and The Honourable Justice Hinton)
30 October 2017
DAMAGES - MEASURE AND REMOTENESS OF DAMAGES IN ACTIONS FOR TORT - MEASURE OF DAMAGES - PERSONAL INJURIES - GENERAL PRINCIPLES
WORKERS' COMPENSATION - WORKERS' COMPENSATION LEGISLATION FOR PARTICULAR INDUSTRIES AND DISEASES - DUST DISEASES - DAMAGES
Appeal against award of damages for personal injury.
The respondent sued the appellant for negligence causing mesothelioma reducing his life expectancy from January 2034 to October 2017. The Judge assessed damages at $1,062,000 including $500,000 for future economic loss, $100,000 for loss of capacity to perform domestic services and $30,000 for exemplary damages.
The award for future economic loss was for loss of a superannuation pension and of the age pension without deduction on account of the value of a reversionary superannuation pension payable to the respondent’s putative spouse but after deduction of an amount assessed as the cost of the respondent’s basic living costs during the lost years.
The appellant appeals against the award of $500,000 on the ground that loss of a pension is not a recoverable head of loss and in the alternative the Judge should have deducted the value of the reversionary pension.
The respondent cross-appeals against the award of $500,000 on the ground that the Judge erred in his assessment of the cost of maintenance; against the award of $100,000 on the grounds that the Judge erred in excluding work performed for the respondent’s daughter and son-in-law at their house, home improvement work and certain time spent with his grandchildren; and against the award of $30,000 on the grounds that the Judge erred in his approach to the assessment and the award is manifestly inadequate.
Held:
1. By Blue J and Hinton J. The Judge did not err in principle in awarding damages for loss of the pensions (at [105] and [253]).
By Stanley J (dissenting). Loss of the pensions is not a recognised recoverable head of loss (at [173]).
2. By Blue J and Hinton J. The Judge erred in not deducting the net present value of the reversionary pension (at [116] and [262]).
By Stanley J (dissenting). If loss of the pensions comprised a recoverable head of loss, the Judge did not err in not deducting the net present value of the reversionary pension (at [179]).
3. By Blue J and Hinton J. The Judge erred in the assessment of the cost of maintenance and should have adopted the figure of $185 per week (at [123]-[124]) and ([239]).
By Stanley J (dissenting). The Judge did not err in his assessment of the cost of maintenance (at [208]).
4. By Stanley J (Blue and Hinton JJ agreeing). No appellable error has been demonstrated by the Judge in his assessment of damages for loss of capacity to perform domestic services (at [203]).
5. By Stanley J (Blue and Hinton JJ agreeing).…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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Details
AGLC
Amaca Pty Ltd v Latz [2017] SASCFC 145
Case
[2017] SASCFC 145
Decision Date
CaseChat Overview and Summary
This case involved a cross-appeal by Mr Latz against an award of damages for personal injuries sustained due to mesothelioma. The appeal was heard by Blue, Stanley, and Hinton JJ of the Supreme Court of South Australia. Mr Latz sought to challenge the trial judge's assessment of future economic loss, loss of capacity to perform domestic services, and the quantum of exemplary damages.
The primary legal issues before the Full Court concerned the recoverability of damages for the loss of a superannuation pension, particularly in the "lost years," and the loss of an age pension. The Court was also required to determine the scope of compensable "domestic services" under the Dust Diseases Act 2005 (SA), the appropriate assessment of personal maintenance costs in the lost years, and the adequacy of exemplary damages awarded.
The Court allowed Amaca Pty Ltd to argue the point regarding the recoverability of damages for the superannuation pension, despite it not being raised at trial. On the issue of domestic services, the Court held that compensation under the Act is limited to services rendered to members of the plaintiff's household, excluding home maintenance and focusing on care for dependants, to be calculated by reference to commercial replacement costs. The Court also found that the trial judge erred in assessing the cost of maintenance in the lost years at $210 per week, determining that $185 per week was the appropriate rate.
Ultimately, the Full Court allowed both the appeal and the cross-appeal, setting aside the original award of damages. The Court re-assessed the damages and ordered Amaca Pty Ltd to pay Mr Latz damages in the sum of $782,000, with parties to be heard on the issue of costs.
Orders
Orders of the court
Full text does not contain this section.
Background
Background to the litigation
Mr Latz cross appeals against:1the award of $500,000 for future economic loss on the ground that the Judge erred in his assessment of basic living costs in the lost years at $210 per week;2the award of $100,000 for loss of capacity to perform domestic services on the grounds that the Judge erred in excluding from the assessment of “domestic services” work performed for his daughter and son in law at their house, home improvement work and certain time spent with his grandchildren; 3the award of $30,000 for exemplary damages on the grounds that the Judge erred in his approach to the assessment and the award is manifestly inadequate. Background Mr Latz was born on 26 April 1947. In 1966 he commenced working for the State Public Buildings Department, qualifying as a survey draftsman. After resigning in 1970 and working in private enterprise, he returned to the Public Buildings Department in 1974. He married and had three daughters. In 1976 Mr Latz bought a block of land and had a house constructed on it. He personally erected a fence on the side boundary constructed of Super Six corrugated asbestos sheets and asbestos capping. In 1977 shortly before his 30th birthday, Mr Latz applied pursuant to section 43 of the Superannuation Act 1974 (SA) (the Previous Act) to the South Australian Superannuation Fund Board (the Board) to become a contributor to the South Australian Superannuation Fund (the Fund). His application was accepted and he became a “new contributor” within the meaning of that Act. He made fortnightly contributions of six per cent of his salary. Mr Latz subsequently transferred to the Department of Lands but this did not affect his superannuation. On 1 July 1988 the Previous Act was replaced by the Superannuation Act 1988 (SA) (the Act). Section 23 provided that generally contributors were to contribute at the standard contribution rate of 6 per cent. Mr Latz continued to contribute to the Fund under the Act. Mr Latz subsequently transferred to the Department of Environment but this did not affect his superannuation. Mr Latz subsequently separated from his wife and they divorced. In 1999 he began a relationship with Joan Taplin and since 2001 they have lived together in a de facto relationship. Ms Taplin was born on 8 August 1951. On 26 April 2007 when he turned 60, Mr Latz retired from the public service and commenced to receive a superannuation pension under the Act (the superannuation pension).On or after 26 April 2012 when he turned 65, Mr Latz commenced to receive a partial age pension from Centrelink (the age pension).[2][2] In May 2012 Mr Latz purchased for a capital sum an income stream by way of an accumulation type superannuation product. This income stream is irrelevant to the claim against Amaca and can be ignored. In October 2016 Mr Latz was diagnosed with terminal malignant mesothelioma. On 26 October 2016 Mr Latz instituted the action against AMACA. At that time his superannuation and age pension entitlements were:· Superannuation pension $51,162 per year[3][3] All dollar figures are rounded to the nearest whole dollar.· Age pension $5,106 per year.The superannuation pension regime
Evidence
Evidence Before The Court
Age pensions are paid out of Commonwealth general revenue. Qualification for an age pension does not depend on a person having paid taxes contributing to general revenue. However the vast majority of age pension recipients will have paid taxes before retirement. At a macro and general level, income taxes paid by employees and the self-employed over their productive lives can be seen as funding payment of the age pension to retirees. The evidence as to pension value Mr Latz retained a chartered accountant, Mark Thompson, to calculate the present value of his future pension entitlements. Mr Thompson’s reports dated 21 November 2016 and 31 March 2017 were received into evidence and he also gave oral evidence. Amaca retained a chartered accountant, Tamara Lindsay, for the same purpose. Ms Lindsay’s reports dated 21 March 2017 and 7 April 2017 were received into evidence. Ultimately Mr Thompson and Ms Lindsay agreed on or at least did not dispute the present value calculation, subject to the three issues of principle addressed at [40] to [45] below. The parties explicitly agree on appeal that the Court should proceed on the basis that:· the calculation was made as at 1 May 2017;· Mr Latz’ reduced life expectancy as a result of developing mesothelioma was six months giving a notional date of death of 31 October 2017;· Mr Latz’ current superannuation pension was $51,162 per year ($981 per week);· Mr Latz’ current age pension was $5,106 per year ($98 per week);· Mr Latz’ current tax on his pension income was $4,669 per year ($90 per week);· Mr Latz’ net (after tax) income from both pensions was $51,599 per year ($989 per week);· the future value of the net pensions was to be discounted to present value at 3% per annum;· the average life expectancy of a 70 year old male (Mr Latz’ age as at 1 May 2017) according to the current Australian Bureau of Statistics (ABS) prospective life expectancy table was 16.71 years translating to a notional expected date of death absent mesothelioma of 15 January 2034;· the appropriate multiplier was 672.03 (16.21 years times 52.14 weeks discounted at 3% pa) times 0.985 for deferral of loss by six months giving a net multiplier of 661.9496. Mr Thompson in his second report calculated the net present value of $989 per week on the above basis at $654,871.[35] Ms Lindsay was not instructed to consider this figure in her third report and she did not give oral evidence. The figure of $654,871 was accepted by the Judge.[35] $989 multiplied by 661.95.Personal expenditure There was a difference between the experts concerning the expenditure that Mr Latz would have incurred during the lost years on his personal maintenance. Ms Lindsay estimated that expenditure at $201 per week based on the ABS Household Expenditure Survey 2009/2010 adjusted by reference to consumer price index movements to December 2016. Mr Thompson was initially instructed not to make any allowance for such personal expenditure. In his second report, he expressed the opinion that such expenditure would have been $185 per week based on data from the same ABS Survey but using instead tables for house owners without a mortgage and tables for South Australia. Ms Lindsay was not instructed to consider this figure in her third report and she did not give oral evidence.
Decision
Reasons for decision
For these reasons I would allow the appeal on ground 3 of the cross-appeal.Conclusion I would allow the appeal and the cross-appeal. As a result I would set aside the award of damages made by the judge. I would re-assess damages. I would order the appellant / cross-respondent to pay the respondent / cross-appellant damages in the sum of $782,000. I would hear the parties as to costs. HINTON J:Introduction I have had the benefit of reading the judgments of Blue J and Stanley J in draft for which I am grateful. I do not repeat the factual background to this matter nor summarise the reasons of the trial Judge. In what follows I adopt the terminology used by Blue J. Seven questions arise for determination. They are:1.Should Amaca Pty Ltd (Amaca) be permitted to argue in this Court that damages were not recoverable by Mr Latz for the loss of his superannuation pension when the point was not taken at trial?2.If so, was Mr Latz entitled to recover damages for the loss of the superannuation pension?3.If yes, was the amount of such damages to be determined net of the reversionary pension?4.Was Mr Latz entitled to recover damages for the loss of the age pension?5.Was the trial Judge right to have awarded damages for loss of capacity to perform domestic services within the meaning of s 9(3) of the Dust Diseases Act 2005 (SA) (Dust Diseases Act) in the amount of $100,000?[180][180] Cross-appeal, ground 1.6.Was the trial Judge right in assessing the cost of maintenance in the lost years to be deducted from any assessment of future economic loss at the rate of $210 per week?[181][181] Cross-appeal, ground 2.7.Was the trial Judge right to award exemplary damages in the amount of $30,000?[182][182] Cross-appeal, ground 3. In answer to question one, I agree with both Blue J and Stanley J for the reasons that they give, that Amaca should be permitted to argue that damages were not recoverable by Mr Latz for the loss of his superannuation pension during the “lost years” despite not taking the point at trial. Skipping to the fifth question, I agree with Stanley J for the reasons he gives that domestic services compensable under s 9(3) of the Dust Diseases Act are those rendered, or which would have been rendered, to a member of the plaintiff’s household and that any award of damages is confined to compensating any loss or impairment of the plaintiff’s capacity to perform such services for the member or members of his or her household. I also agree that such loss does not include home maintenance but is directed to the care of those members of the plaintiff’s household who are dependent upon the plaintiff and that such loss falls to be calculated by reference to the commercial cost of their replacement. As for the sixth question, I agree with Blue J for the reasons he gives that the trial Judge erred in assessing the cost of maintenance in the lost years to be deducted from any assessment of future economic loss at the rate of $210 per week. I also agree, for the reasons given by Blue J, that in determining the matter afresh the appropriate rate is $185 per week with the consequence that $15,089 is to be deducted from the award made by the trial Judge.