JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA LOCATION : PERTH CITATION : BEAMISH -v- KANAKIS [2017] WADC 33 CORAM : DERRICK DCJ HEARD : 8 FEBRUARY 2017 DELIVERED : 15 MARCH 2017 FILE NO/S : APP 69 of 2016 BETWEEN : CATHERINE BEAMISH Appellant
AND
JAMES KANAKIS
Respondent
ON APPEAL FROM: Jurisdiction : MAGISTRATES COURT OF WESTERN AUSTRALIA Coram : MAGISTRATE COCKRAM
File No : PE GCLM 307 of 2015
Catchwords:
Appeals - Appeal against decision of Magistrate awarding damages for loss of use of non-income earning motor vehicle - Damages assessed by magistrate by reference to cost of hiring comparable vehicle - Principles to be applied in assessing damages payable for the loss of use of a non-income earning motor vehicle
Legislation:
Accident Towing Services Act 2007 (VIC)
Magistrates Court (Civil Proceedings) Act 2004 (WA)District Court Rules 2005 (WA) Result:
Appeal allowed
Damages awarded varied Representation:
Counsel:
Appellant : Mr C G Colvin & Mr G J Pynt
Respondent : Mr M D Howard & Ms J L W Henderson
Solicitors:
Appellant : SRB Legal
Respondent : Jonathan D'Arcy & Co
Case(s) referred to in judgment(s):Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172Anthanasopoulos v Moseley [2001] NSWCA 266; (2001) 52 NSWLR 262Bent v Highways and Utilities Construction Ltd [2010] EWCA Civ 292Brocklehurst v Wolinski [2015] WADC 36Butler v Bennett [2007] WADC 107Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194Dimond v Lovell [2002] 1 AC 385Droga v Cannon [2015] NSWSC 1910Giles v Thompson [1994] 1 AC 142Griffiths v Kerkemeyer [1977] HCA 45; (1977) 139 CLR 161Hoskins v Armstrong [2008] WADC 168Livingstone v Rawyards Coal Co (1880) 5 App Cas 25Lowe v Pearce [2016] NSWLC 5Pattni v First Leicester Buses Limited [2011] ECWA Civ 1384Poole v Smith's Car Sales (Balham) Ltd [1962] 2 All ER 482Regan v Gibson [2010] WADC 144Saric v Tehan [2011] VSCA 421The Owners of No 7 Steam Sand Pump Dredger v The Owners of SS 'Greta Holme' [1897] AC 596The Owners of Steamship 'Mediana' v The Owners, Master and Crew of Lightship 'Comet' [1900] AC 113Wong v Maroubra Automotive Refinishers Pty Ltd; Ayres v Maroubra Automotive Refinishers Pty Ltd [2015] NSWSC 222Yates v Mobile Marine Repairs Pty Ltd [2007] NSWSC 1463Introduction 1 Ms Beamish appeals against the judgment of Magistrate Cockram in Kanakis v Beamish, MC/CIV/PER/GCLM 307 of 2015, awarding Mr Kanakis damages in the sum of $16,813.03, plus interest at the rate of 6% per annum from 6 August 2014 - 24 August 2016 plus costs. His Honour delivered written reasons for his decision on 24 August 2016.
2 Ms Beamish seeks orders that the appeal be allowed and that the respondent's claim be dismissed with costs, alternatively, that the appeal be allowed and that the damages awarded to the respondent be substantially reduced.
3 The appeal raises for consideration the issue of the approach to be taken in assessing damages for the temporary loss of use of a non-income producing motor vehicle where the loss of use is the result of damage caused to the vehicle by a negligent third party.
Non-contentious factual background
4 On 27 November 2010 Mr Kanakis purchased a 2006 Porsche Boxster convertible (the 2006 Porsche) from Chellingworth Motors for $63,636.36. As at the date of purchase the odometer reading for the 2006 Porsche was approximately 7,000 km.
5 On 6 August 2014 Ms Beamish negligently drove her vehicle into the rear of the 2006 Porsche causing it to be damaged.
6 On 14 August 2014 Mr Kanakis took the 2006 Porsche to a repair shop so that the damage to it could be repaired. Ms Beamish's insurer, RAC Insurance Pty Ltd (RAC), paid for the costs of the repairs to the 2006 Porsche. As at 14 August 2014 the odometer reading for the 2006 Porsche was 39,541 km.
7 On 18 August 2014 Mr Kanakis entered into a rental agreement with Compass Corporation Pty Ltd (Compass) pursuant to which Compass hired to Mr Kanakis for his use a 2014 Porsche Boxster (the 2014 Porsche) while the 2006 Porsche was being repaired. The odometer reading for the 2014 Porsche as at 18 August 2014 was 2,470 km.
8 Under the rental agreement Compass hired the 2014 Porsche to Mr Kanakis at a daily rate of $540.91. This sum included $49 per day for insurance. In addition to the daily rate Compass charged a delivery fee of $60.
9 On 18 August 2014 Mr Kanakis also entered into a 'Mandate and Authority to Act' agreement with Compass (the Mandate). The arrangement under the Mandate was, in essence, that Mr Kanakis would not have to make any upfront payment to Compass for the costs associated with hiring the 2014 Porsche, and that Compass would seek to recover the costs of providing the 2014 Porsche to Mr Kanakis from Ms Beamish or her liability insurer.
10 Mr Kanakis made use of the 2014 Porsche for a period of 32 days, this being the period of time it took for the 2006 Porsche to be repaired (the repair period). The total charge raised by Compass for the use of the 2014 Porsche during the repair period inclusive of GST and the delivery fee was $19,106.03.
11 During the repair period Mr Kanakis did require the use of a replacement vehicle for the 2006 Porsche. He needed a vehicle for work, to visit his girlfriend, to attend the gym, to attend dancing lessons, to run errands for his parents and to visit his father in hospital.
12 On 24 September 2014 Compass issued an invoice to RAC, Ms Beamish's liability insurer, for the sum of $19,106.03. RAC did not pay the invoice. RAC assessed the value of Mr Kanakis' compensable loss for the repair period to be $2,288. RAC paid this amount to Compass. Compass did not accept the payment of $2,288 in full satisfaction of its invoice. Rather, it accepted the payment as part payment only of its invoice leaving an outstanding balance of $16,818.03.
13 Mr Kanakis was also insured with RAC. Under Mr Kanakis' insurance policy Mr Kanakis had the option to hire a car free of charge for the repair period. This cost would have been charged by a car rental company (Budget) to RAC at the rate of $71.50 per day which would have totalled $2,288. It was on this basis that RAC assessed the value of Mr Kanakis' compensable loss for the repair period to be $2,288.
14 On 12 January 2015 Mr Kanakis initiated his claim in the Magistrates Court seeking to recover $16,818.03 from Ms Beamish.
15 Although it is Mr Kanakis and Ms Beamish who are the parties to the litigation, the reality of the situation is that the dispute that has given rise to the litigation is between Compass and RAC.
16 It is not clear why the magistrate awarded damages in the amount of $16,813.03 as opposed to damages in the amount of $16,818.03. In any event, the unexplained $5 differential is, not surprisingly, of no concern to the parties. It is of no relevance to the issues raised on the appeal.
Statutory provisions and principles governing the appeal
17 The appellant's right to appeal against the decision of the magistrate is created by s 40 of the Magistrates Court (Civil Proceedings) Act 2004 (WA) (the Act). The appeal must also be conducted in accordance with r 50 of the District Court Rules 2005 (WA) (the DCR).
18 It is clear from s 40(4) of the Act and r 50(1) and r 50(2) of the DCR that an appeal from a decision of a magistrate to the District Court is by way of rehearing: Butler v Bennett [2007] WADC 107 [10]; Hoskins v Armstrong [2008] WADC 168 [3]; Regan v Gibson [2010] WADC 144 [7]; Brocklehurst v Wolinski [2015] WADC 36.
19 Given that an appeal from a decision of a magistrate is by way of rehearing it is necessary for the appellant to demonstrate error in the court below: Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194 [14]. Thus the appellate powers of the District Court are only exercisable if the appellant demonstrates that the decision made by the magistrate was the result of some legal, factual or discretionary error: Allesch v Maunz [2000] HCA 40; (2000) 203 CLR 172 [23].
20 The orders that the District Court may make on the appeal are set out in s 43 of the Act.
Appeal notice
21 Ms Beamish's appeal notice contains 10 lengthily expressed grounds of appeal. However, Ms Beamish now presses only grounds 2, 4, 6, 7, 9 and 10.
22 During the hearing of the appeal Ms Beamish's counsel asserted that the various grounds of appeal that are pressed encompass and give rise to four questions for determination (ts 3, 14). The questions identified by counsel are, in substance, as follows:
1. What are the correct legal principles to apply in assessing quantum for loss of use of a non-income producing chattel, particularly a private motor vehicle? 2. Did the magistrate apply the correct legal principles in assessing quantum for Mr Kanakis' loss of use of the 2006 Porsche?
3. What was the evidence before the magistrate as to the value of the 2006 Porsche?
4. On all the evidence did Mr Kanakis prove that he suffered compensable loss greater in amount than the amount already paid by RAC to Compass?
23 In identifying these questions counsel for Ms Beamish accepted that if, contrary to the contention put on Ms Beamish's behalf, the magistrate did apply the correct legal principles in assessing the quantum of Mr Kanakis' damages, there could be no challenge to the magistrate's assessment of the damages payable with the result that the third and fourth of the above identified questions would not need to be addressed. 24 Counsel for Mr Kanakis did not attempt to suggest that Ms Beamish's counsel's identification of the above four questions did not adequately reflect or encompass the substance of the grounds of appeal. Indeed, he approached the making of his oral submissions by substantially addressing the questions posed by Ms Beamish's counsel albeit without making express reference to each of the questions in turn.
25 Given the approach of counsel for both parties, I propose to approach the matter by dealing with the first and second of the above posed questions, and then if necessary the third and fourth questions, before turning to deal briefly and directly with each of the pursued grounds of appeal.
What are the correct legal principles to apply in assessing quantum for loss of a non-income producing private motor vehicle?
The magistrate's identification of the correct legal principle
26 In his reasons for decision the magistrate, after conducting a review of a number of cases decided in this country and in England, expressed his conclusions as to the principles to be applied in assessing the damages to be paid to Mr Kanakis for the loss of use of the 2006 Porsche during the repair period in the following terms [40] - [42]:
40. I am satisfied that I should follow the decisions in Moseley, Yates and Lowe. I therefore accept the submission of Counsel for Mr Kanakis that he does not have to prove need; that he is entitled to an award of damages to compensate him for his loss of use of his 2006 Boxter [sic]. That position is consistent with the general principle that Mr Kanakis is entitled to be put in the same position he would have been in had the collision not occurred on 6 August 2014. What Mr Kanakis has lost is the use of his 2006 Boxter. The ability to hire a Porsche Boxter in Perth is limited. It is not suggested on behalf of Ms Beamish that, in 2014, it would have been possible for Mr Kanakis to hire a 2006 Boxter in Perth, thereby mitigating his loss. It is not suggested by Ms Beamish that, in 2014, it would have been possible for Mr Kanakis to hire a Porsche Boxter older than a 2014 model, thereby mitigating his loss. I am satisfied that in August 2014, the 2014 Boxter was the only Boxter reasonably capable of being hired. 41. I do not accept that the measure of Mr Kanakis' damages should be by reference to a vehicle which would merely meet the needs of Mr Kanakis; that would get him from point A to point B. What he needs a car for is not the issue. The issue is, what is he entitled to hire to compensate him for his loss of use of his 2006 Boxter. On the evidence, the closest vehicle that would compensate him for that loss was the 2014 Boxter. On the evidence, the 2014 Boxter was a reasonable replacement.
42. I accept that the value of Mr Kanakis' 2006 Boxter in 2014 is not a useful or appropriate way to decide what vehicle he was entitled to in 2014 …
27 Thus the magistrate concluded, in essence, that Mr Kanakis did not, in order to recover damages for the temporary loss of the 2006 Porsche, have to prove that he needed a replacement vehicle, and that the damages payable to Mr Kanakis should be measured not by reference to the cost of hiring a vehicle that met his needs during the repair period, but rather by reference to the cost of hiring the closest vehicle that would compensate him for his loss of use of the 2006 Porsche, namely the 2014 Porsche. Consistently with this expressed conclusion his Honour proceeded to assess the damages payable to Mr Kanakis by reference to the rate paid for the hire of the 2014 Porsche and consequently awarded the sum of $16,813.03. 28 The magistrate's reference in [40] to the decisions in Moseley, Yates and Lowe was a reference to the decisions in Anthanasopoulos v Moseley [2001] NSWCA 266; (2001) 52 NSWLR 262; Yates v Mobile Marine Repairs Pty Ltd [2007] NSWSC 1463 and Lowe v Pearce [2016] NSWLC 5 respectively
The parties' contentions - summary
29 On behalf of Ms Beamish it is submitted that the approach of the magistrate as reflected by his Honour's above cited statements, which she asserts involved him putting to one side the issues of use, need and value in assessing the damages payable to Mr Kanakis, was contrary to established principles for determining compensation for the loss of non-income producing chattels. It is submitted that the approach that the magistrate should have adopted, having regard to the relevant authorities and consistently with the fundamental principle governing the award of damages in negligence cases, namely that the damages should place the injured party, so far as money can do it, in the position that he or she would have been in if the injury had not occurred (Livingstone v Rawyards Coal Co (1880) 5 App Cas 25, 39), was to assess the damages payable to Mr Kanakis by reference to all the relevant circumstances. It is submitted that the relevant circumstances consisted of the use to which Mr Kanakis put the 2006 Porsche and the consequential precise nature of Mr Kanakis' need for a replacement vehicle (referred to by Ms Beamish's counsel as 'the demonstrated need'), the nature and value of the 2006 Porsche, the nature and value of the 2014 Porsche, and the nature and value of vehicles readily available for hire by Mr Kanakis from a mainstream hire car company capable of meeting the precise nature of his need for a replacement vehicle.
30 On behalf of Mr Kanakis it is submitted that the magistrate's reasoning and conclusions as disclosed in the above cited pars of his reasons for decision are in accordance with the relevant authorities and are consistent with the above referred to fundamental principle governing the award of damages in negligence cases. It is submitted that need, and consequently the other circumstances identified by Ms Beamish as also being relevant to the quantification of the damages payable to Mr Kanakis for the temporary loss of the 2006 Porsche, are simply not relevant to the quantification process. It is submitted that on the authorities all that Mr Kanakis was required to demonstrate in order to recover damages was loss of use, or perhaps more precisely, loss of the ability to use the 2006 Porsche during the repair period. Alternatively, it is submitted that even if need for a replacement vehicle is relevant to the quantification process, all that Mr Kanakis was required to demonstrate was that he needed a replacement vehicle in the sense that he would have used the 2006 Porsche during the repair period if it had not been damaged, and that the precise nature of Mr Kanakis' need, that is, the demonstrated need, is irrelevant to the quantification process. It is submitted that the appropriate way to 'fix quantum is by reference to the cost of hiring a similar comparable vehicle' or the closest that one can get to a comparable vehicle (ts 26, 36). In other words, it is submitted that the damages should be fixed by reference to the cost of hiring a vehicle which is the closest available vehicle in make and model to the damaged vehicle, which in the present case was the 2014 Porsche.
31 As will be apparent from what I have said it is necessary, in order to address and deal with the parties' competing contentions as to the proper legal principles to be applied in assessing the damages in this case, to undertake a review of the authorities which bear upon the issue and upon which the parties rely.
The relevant Australian authorities
Anthanasopoulos v Moseley
32 The starting point in any consideration of the relevant Australian authorities is the decision in Anthanasopoulos v Moseley. Both parties place significant reliance on this decision in support of their respective positions.
33 In Anthanasopoulos the respondents were plaintiffs in four separate actions commenced in the New South Wales Local Court to recover the costs of hiring a replacement vehicle while the respondent's own vehicle was being repaired after a collision with the relevant appellant's vehicle. There was no issue that each appellant was the party at fault in the collision.
34 The respondents were each insured with NRMA. There were a number of exclusions from the cover provided by the NRMA insurance policy, including the cost of hiring a vehicle whilst the insured's damaged vehicle was being repaired. Notwithstanding this exclusion, NRMA had in place a 'Courtesy Car Program'. Under the program an insured was entitled to a courtesy car either at no cost to the insured for up to 14 days if the insured was not at fault, or at a preferential rate if the insured was at fault. Where the insured was not at fault NRMA bore the cost of the hire for the 14 day 'courtesy' period. In either case the program required the insured to have the damaged vehicle repaired by an 'NRMA approved' repairer.