Attard v Aberwood Pty Limited & Anor

[2004] NSWCA 412

NEW SOUTH WALES COURT OF APPEAL

CITATION:      Attard v. Aberwood Pty. Limited & Anor. [2004]  NSWCA 412

FILE NUMBER(S):
41031/03

HEARING DATE(S):               9 November 2004

JUDGMENT DATE: 09/11/2004

PARTIES:
Anthony Attard - appellant
Aberwood Pty. Limited - 1st respondent
Michael John Cassells - 2nd respondent

JUDGMENT OF:       Beazley JA Hodgson JA Ipp JA   

LOWER COURT JURISDICTION: Supreme Court - Common Law Division

LOWER COURT FILE NUMBER(S):          SC 20598/01

LOWER COURT JUDICIAL OFFICER:     Master Harrison

COUNSEL:
Mr. A.J. McQuillen for appellant
Mr. G. Bellew for respondents

SOLICITORS:
G.H. Healey & Co., Sydney for appellant
Sparke Helmore, Sydney for respondents

CATCHWORDS:
DAMAGES - Economic loss - Adoption of global figure for future economic loss - Findings provided alternative basis of assessment - Whether appealable error.

LEGISLATION CITED:

DECISION:
(1) Appeal allowed. (2) Respondents to pay the appellant's costs of the appeal and to have a certificate under the Suitors Fund Act if otherwise entitled. (3) The orders below set aside and in lieu thereof verdict and judgment for the appellant in the sum of $249,446 to take effect as at 9 December 2003. (4) Each party to pay its own costs of the hearing below, including the arbitration.

JUDGMENT:

IN THE SUPREME COURT

OF NEW SOUTH WALES
COURT OF APPEAL

CA 41031/03
SC 20598/01

BEAZLEY JA
HODGSON JA
IPP JA

Tuesday 9 November 2004

ATTARD V. ABERWOOD PTY. LIMITED & ANOR.

Judgment

1. HODGSON JA: On 3 November 2003 Master Harrison gave judgment in proceedings under the Motor Accidents Act 1988 in which the appellant sued the respondents for damages in respect of a motor accident. Liability was admitted and the Master assessed damages at $151,776.

2. On 6 November 2003 the Master gave a further judgment in which she referred to an award made by an arbitrator on 7 March 2003 in which the arbitrator had awarded $235,579 and had, pursuant to Pt.52A r.33(2f), indicated that each party should pay its own costs.  The Master decided that that decision as to costs should stand and, in accordance with Pt.52A r.34(b), ordered the appellant to pay the respondent’s costs of the re-hearing.

3. On 9 December 2003 the Master varied her previous decision by deleting $5,330 previously allowed for interest on past economic loss, and entered judgment for the appellant in the sum of $146,446. 

4. The appellant appealed from those orders.

5. The accident giving rise to the proceedings occurred on 30 June 1998 when a truck driven by the second respondent struck a four-wheel drive vehicle driven by the appellant, and the appellant sustained injuries to his neck, shoulder, left arm, back and left leg. 

6. The appellant was born in 1952 in Malta and migrated to Australia in 1971.  Within two weeks he had obtained a job and he has worked full-time ever since, sometimes in employment and sometimes conducting businesses.  He was married in 1975 and has four children who are now adults. 

7. In 1994 he commenced doing work with Fleetwood Engineering Pty Limited, being engaged on a subcontracting basis through his own company, Attard Nominees Pty Limited.  This work involved constructing and maintaining wooden footbridges and walking platforms, and was physically very demanding.  This work continued up to the time of the accident.  In addition, Attard Nominees also undertook two other areas of work, namely reconditioning tanks for Castrol and kitchen cabinet-making.

8. After the accident the appellant was off work for two weeks.  He then continued to work for Fleetwood until April 2001, though he found it difficult because of neck and shoulder pain, and he sometimes had to take time off work.  In December 2002, he ceased carrying out work for Castrol because this was getting too much for his shoulder. 

9. In the meantime the cabinet-making business, which was described as something of a hobby prior to the accident, expanded and it progressively became his main source of income. 

10. In about 2001, he purchased a property at Berkshire Park and built a large shed on it to accommodate the expanding cabinet-making business, and he also moved to live at this property.

11. The Master made the following findings concerning this cabinet-making business which are not challenged:

    39 Prior to the accident, the plaintiff’s wife gave a little assistance to the plaintiff with the assembly and construction of kitchen cabinets because the plaintiff could do it on his own and never did that much of it anyway (t 23). The plaintiff may attend the client’s premises to carry out the measurements for the new kitchen. The process of making kitchen cabinets starts with the delivery of large sheets of particleboard. The boards can be 1200mm wide by 2400 high. The plaintiff, with the assistance of his wife, cut the boards up into the prerequisite sizes. The cupboards are assembled on the bench and then put down onto the floor. When everything is ready, the doors are affixed to the cupboards. The cabinets are carried out to the trailer and transported to the customer’s place. The cabinets are then assembled in the kitchen.

    40 Since the accident, the plaintiff has become aware that when he lifts the large sheets of plywood his left shoulder starts aching. He can lift one to three of these sheets, but if he is required to lift ten he has this problem. There is no problem with 600mm cupboards, but problems develop with the 900mm cupboards (t 23). He requires his wife’s assistance when the large sheets are cut into smaller sizes. This cutting process can take up to 1½ days for each kitchen. He needs his wife to assist him with the lifting of larger cupboards such as those the size of a pantry. He also requires her help when he has to deliver a kitchen to a customer’s house. At the customer’s house, the plaintiff needs his wife to help him affix the overhead cupboards and the large pantry type cupboards.

    41 In about 2001 when the cabinet making process was relocated to the shed at Berkshire Park, the plaintiff’s wife commenced accompanying him for five days per week. The plaintiff works 7 days per week. They attend the shed from 7.30am until 7.30pm. They work Saturdays and Sunday. The plaintiff’s wife looks after her grandchild on Monday and Tuesdays. The plaintiff’s wife assists him on and off throughout the day, but on average she provides physical assistance for three to four hours per day (t 25).

12. The Master made the following findings on non-economic loss:

    27 I have referred to the plaintiff’s injuries to his neck and left shoulder, back, left arm and leg and right shoulder and adjustment disorder previously in this judgment and the medical opinions expressed above. I have taken these into account.

    28 Prior to the accident, the plaintiff went rock fishing with his son on Sundays. On Saturday evenings the plaintiff and his wife attended Church and sometimes went out to dinner afterwards. He was a happy man. After the accident, the plaintiff found this past time physically difficult such that he no longer enjoyed it. He prefers to work. Prior to the accident, the plaintiff’s wife described him as being happy with a good sense of humour. She gave evidence that after the accident the plaintiff changed. He angers more easily.

    29 After the accident the plaintiff’s sleeping habits have changed markedly. He used to sleep very well. Now on at least three nights per week, he has disturbed sleep. He cannot sleep well on his left hand side and his arm goes numb. He has a repeated nightmare involving a motor vehicle accident, which causes him to wake up feeling hot and very sweaty. His wife says that she sometimes hears the plaintiff shouting. The plaintiff at this time gets out of bed and watches television until he falls asleep. Hence when he wakes up in the morning he sometimes feels tired. At the shed, if the plaintiff has not had enough sleep the previous night he sleeps for about half to one hour during the day in the back of the trailer.

    30 The plaintiff’s wife has observed him rubbing his neck and left shoulder. She massages the plaintiff’s shoulder three to four times per week for five to ten minutes. The plaintiff’s wife has observed that in the last two years, the plaintiff’s productivity at work has decreased. It now takes longer to do the same job and he is always tired. The plaintiff gets tired more easily and has some difficulty with concentration and angers more easily.

    31 The plaintiff suffers from headaches about twice per week, but some weeks he does not get any (t 21). He never experienced headaches prior to the accident. His current complaints are that he has constant pain at the back of his neck on the left hand side. He experiences lower back pain and when he keeps pushing himself at work he experiences pain from time to time which radiates down his left leg and to the two biggest toes on his left foot. If he pushes himself at work the pain may also spread across to his right shoulder. The plaintiff is capable of performing domestic duties, lawn mowing and gardening.

    32 The plaintiff was absent from full-time work for two weeks. He is still able to work long hours doing physical work, albeit with pain, sometimes it is worse than at other times. Sometimes he has had to rest at work for half to one hour during the day. Taking all of this into account, I assess non economic loss as being 25% of a most extreme case, which equates to $21,500.00.

    She assessed out-of-pockets at $4,946.

13. As regard to economic loss, the Master referred to the income of the business of Attard Nominees for the years ended in June 1996 to 2001, and to accountants’ reports provided by the parties.  She considered the question of retiring age and held that, but for the accident, when the appellant reached sixty-five, more likely than not he would not have continued heavy activities on a full-time basis but would, up to the age of about seventy, have undertaken smaller projects from home. 

14. She concluded as follows on the matter of economic loss:

    48 I accept that the plaintiff is slower in production at work than he would have been had the accident not occurred. I also accept that the plaintiff now needs some assistance from his wife, as detailed earlier in this judgment. The plaintiff’s accountant has based his calculations on the 1997 income. The year 1998 would have been more appropriate. Further, the plaintiff’s cabinet making business is subject to fluctuations in demand. Whether or not the accident occurred, the fluctuations in demand for kitchen cabinets would have occurred. From time to time the plaintiff would have required additional labour to cope with the increased demands and deadlines. The plaintiff does not have any difficulty carrying out most of the work starting with giving quotations. Thus, I do not think that the plaintiff’s accountant’s approach should be adopted. Doing the best I can, in these circumstances, the best approach is to award a global sum to apportion the need the plaintiff has to employ additional labour for the next 14 years due to the injuries he suffered in the car accident. The appropriate sum is $80,000.00 for both past and future economic loss. I attribute $20,000.00 to the past and $60,000.00 for the future. I also allow a sum of $15,000.00 for his reduced earning capacity for the years when the plaintiff is aged between 65 and 70. The total of future economic loss is $95,000.00.

15. The Master assessed loss of superannuation at $5,000.  No allowance was made for domestic assistance.  She assessed damages in respect of future medical treatment at $20,000.

16. The appellant relies on the following grounds of appeal:

    1.The Master erred in failing to award a greater amount for non economic loss having regard to the impact of the motor vehicle accident on the Appellant.

    2.The Master erred in making the findings she did with respect to the claims for past Griffiths v Kerkemeyer.

    3.The Master erred in making the findings she did with respect to future treatment costs.

    4.The Master erred in making the findings she did with respect to the Appellant’s economic loss and consequential losses including superannuation.

    5.The Master erred in making the findings she did with respect to interest and costs.

17. As regards economic loss, Mr McQuillen, for the appellant, submitted that the Master made errors in rejecting the appellant’s accountant, apparently on the basis that he based his calculations on figures for the year ended June 1997 rather than the year ended June 1998, without giving reasons for that view, and on the basis that the appellant’s accountant based his calculation on the employment of one additional person in the business.  But for those errors, it was submitted, in substance the evidence of the plaintiff’s accountant should have been accepted.

18. As an alternative submission it was put that the Master should have taken the extra work now performed by the appellant’s wife as some measure of the appellant’s diminution of earning capacity, and this would have shown that the global figure reached by the Master was substantially inadequate.  It was submitted that, where there were these other proper bases for calculating economic loss, and in particular future economic loss, it was not appropriate to do as the Master had done to adopt a global figure.

19. Mr Bellew, for the respondents, submitted that although the Master might possibly have gone about assessing economic loss, and in particular future economic loss, on the basis of her findings as to assistance given by the appellant’s wife, the alternative approach that she adopted was appropriate and the result is not shown to be unreasonable.  He submitted that, in circumstances where changing fortunes of the business may mean that the present amount of assistance given by the wife is not needed for the future, this provides a substantial reason for adopting the approach taken by the Master rather than an approach based on the assistance given by the appellant’s wife. 

20. In my opinion, no error of the Master is shown in relation to her rejection of a calculation of loss based on the results for the year ended June 1997.  Although a reason was advanced why the results of the business in 1998 were lower than in 1997, in my opinion the Master was justified in reaching the view that this did not make it appropriate to select 1997 as the basis for comparison.  In my opinion also no error of the Master is shown in taking the view that the evidence did not establish that the employment of one extra person was an appropriate measure of the appellant’s loss of earning capacity.

21. In my opinion, the appellant’s evidence did not establish any actual loss of income of the business and of himself and his wife, especially as no analysis was offered as to the results for the years ended June 2002 and June 2003.  In my opinion, it is a fair conclusion from the evidence, and substantially one that the Master reached, that the loss of earning capacity could not be measured by any consideration of loss of the overall income of the business. 

22. Plainly, however, the appellant did establish a substantial loss of earning capacity through his inability to do heavy work and being slower in the work that he did, to an extent estimated by him at 10 to 15 per cent.  If there had been no basis for quantifying the value of this loss of earning capacity other than taking a global approach, then while the result reached by the Master might seem low I do not think it could be considered appealably wrong. 

23. However, the Master did find that the appellant needed the assistance given to him by his wife, and did quantify that assistance as three to four hours a day for five days per week, and there was evidence before the Master that, if such assistance had been given by an unskilled labourer, it would cost about $20 to $25 per hour.  The evidence of the plaintiff and his wife, and indeed the findings of the Master, tended to support the view that that was a reasonable measure of the effect of the appellant’s loss of earning capacity at around the time of the trial, and could be considered a reasonable basis for extrapolating that into the future. 

24. In my opinion, when there was that method of quantifying the loss of earning capacity available, the Master should have considered how that measure could translate into figures, if only to check the result against her global assessment.  In my opinion, if that had been done it would have indicated that her global assessment was too low.

25. I will give the figures in a moment, but my opinion is that when one has regard to those figures and the difference in the result that they give from the figure reached by the Master, it does indicate an error sufficient to justify appellate intervention.

26. In my opinion, it is appropriate for this Court to do its best to assess an appropriate figure, and in my opinion an appropriate starting point for this assessment is the value of the wife’s assistance found by the Master to be needed by the appellant.

27. The figures that I have indicated give a range of the value of this assistance between $300 and $500 a week.  If one takes a mid-point of $400 and makes an allowance for taxation considerations and takes a figure of $300, then it seems to me that is the most satisfactory starting point that can be justified by the evidence.  It is impossible to be precise about the taxation effects, because the income of the company and of the plaintiff and his wife would all attract different rates of tax, so the taxation effect of payment of $400 a week, on the nett income of the company and the plaintiff and the plaintiff’s wife, cannot be precisely determined.  It seems to me that it would be reasonable to select the figure of $300 per week.

28. Although there is no guarantee that this is the measure of loss of capacity that would continue until age sixty-five, it seems to me that it is a reasonable measure to adopt for that period.  Things could get better or could get worse, and in my opinion it is appropriate to treat that figure as continuing through to age sixty-five, and then apply the conventional 15 per cent discount for vicissitudes.  If one works that out on the tables, the calculation is $300 times 529.3 times .85.  That gives $134,791, which may be rounded out to $135,000. 

29. It is the comparison between that figure and the figure of $60,000 adopted by the Master that in my opinion is indicative of error by the Master, and in my opinion the figure $135,000 for future loss is an appropriate figure to select for loss up till age sixty-five.  The figure of $15,000 adopted by the Master for loss between age sixty-five and seventy in my opinion should stand.

30. Turning to past loss, the evidence was that the assistance at the level I have referred to commenced in about 2001.  So in my opinion it is appropriate to allow $300 per week for two years, giving $31,200.  For the 171 weeks between the accident and the commencement of that two years, doing the best I can I would adopt a figure of $100 per week for the times when the appellant was unable to work and for the lesser assistance given to him by his wife over that period, giving a figure of $17,100.  So I would round out the figure for past economic loss to $48,000. 

31. That gives a total for economic loss, apart from the $15,000 between sixty-five and seventy, of $183,000, an increase of $103,000 over the Master’s figure.

32. I turn now to the other challenges to the Master’s decision.

33. As regards non-economic loss, in my opinion no error has been demonstrated in the Master’s reasons.  The only possible matter is that the Master did not explicitly refer to the circumstance that the appellant used to enjoy doing heavy work and now is deprived of that enjoyment and satisfaction.  I do not think the failure to advert specifically to that is sufficient to vitiate the reasons.  In my opinion the assessment of 25 per cent of a most extreme case is not shown to be unreasonable to an extent that could attract appellate intervention. 

1. Having regard to the decision on economic loss, the challenge on the basis of domestic assistance is not pursued.

2. As regards future medical expenses, the Master did not conclude that it was reasonable for the appellant to have monthly consultations with his general practitioner.  In my opinion no error is shown in that regard, and no error shown in the ultimate conclusion.

3. There was a challenge made to the Master’s assessment of superannuation.  However, in circumstances where the appellant’s income at the moment and for the foreseeable future is through his own company, it seems to me that there is no basis on which it can be said that the Master’s assessment was inadequate. 

4. The result of these findings would be to increase the verdict from $146,446 to $249,446.  In my understanding, that would remove the basis for the order that the appellant pay the respondents’ costs of the hearing.  However, it would not remove the basis for ordering that otherwise each party bear their own costs.  In my opinion that should be the result. 

5. So for those reasons my opinion is that the following orders should be made: 

   (1)Appeal allowed.

   (2)Respondents to pay the appellant’s costs of the appeal and to have a certificate under the Suitors Fund Act if otherwise entitled.

   (3)The orders below set aside and in lieu thereof verdict and judgment for the appellant in the sum of $249,446 to take effect as at 9 December 2003.

   (4)Each party to pay its own costs of the hearing below, including the arbitration.

6. BEAZLEY JA:  I agree.

7. IPP JA:  I agree.

8. BEAZLEY JA:  The orders of the Court are as proposed by Hodgson JA.

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LAST UPDATED:               12/11/2004