Brown v Falzari
[2001] TASSC 46
•24 April 2001
[2001] TASSC 46
CITATION: Brown & Anor v Falzari [2001] TASSC 46
PARTIES: BROWN, Doug
STATE OF TASMANIA
v
FALZARI, Carol Grace
TITLE OF COURT: SUPREME COURT OF TASMANIA (FULL COURT)
JURISDICTION: APPELLATE
FILE NO/S: FCA 44/1999
DELIVERED ON: 24 April 2001
DELIVERED AT: Hobart
HEARING DATES: 6 - 8 November 2000
JUDGMENT OF: Underwood, Crawford and Evans JJ
CATCHWORDS:
Damages - Particular awards of general damages - Tasmania - Whiplash injury suffered by 38 year old nurse - Whether total or partial loss of earning capacity both before and after trial - Measurement of lost earning capacity - Award varied.
Aust Dig Damages [61]
REPRESENTATION:
Counsel:
Appellants: K E Read
Respondent: D J Gunson and K J Monaghan
Solicitors:
Appellants: Phillips Taglieri
Respondent: Gunson Pickard & Hann
Judgment Number: [2001] TASSC 46
Number of Paragraphs: 97
Serial No 46/2001
File No FCA 44/1999
DOUG BROWN and STATE OF TASMANIA v CAROL GRACE FALZARI
REASONS FOR JUDGMENT FULL COURT
UNDERWOOD J
CRAWFORD J
EVANS J
24 April 2001
Orders of the Court
Appeal allowed.
Judgment for the plaintiff against the defendants varied by substituting the sum of $588,700 for the sum of $929,969
Serial No 46/2001
File No FCA 44/1999
DOUG BROWN and STATE OF TASMANIA v CAROL GRACE FALZARI
REASONS FOR JUDGMENT FULL COURT
UNDERWOOD J
24 April 2001
The claim
At about 6.30am on 3 January 1985, the respondent was in an accident on the junction of Davey and Barrack Streets, Hobart. She was on her way to work at the Repatriation Hospital. She had driven up Barrack Street and was crossing Davey Street when the first appellant drove up Davey Street on her left, failed to stop at the red light and smashed into the passenger side of the respondent's car. The respondent immediately felt pain in her cervical spine, right shoulder, right arm and right knee. She went home instead of going to work.
About two days later, the respondent returned to work, but was troubled by pain in her neck and soreness in her shoulders. Despite a cervical fusion at C5/6 on 20 November 1985 and many other subsequent procedures, the respondent continued to suffer from pain in her neck and shoulder with tingling and weakness in the right arm. She also claimed that the accident caused the onset of chronic depression and that, together, the physical and psychological deficits destroyed her earning capacity.
At the time of the accident the respondent was aged 38 years, married and without children. She was a registered nurse with several post graduate qualifications. She was then halfway through an external studies course to attain a degree in nursing administration. The learned trial judge found:
"The plaintiff was competent in her work, had obtained specialist and tertiary qualifications and was likely to continue in her career until retirement. It is probable that she would have obtained a more senior administrative position."
The respondent commenced proceedings against the appellants to recover damages. She claimed that the first appellant's tortious conduct had destroyed her earning capacity, substantially diminished the quality of her life and caused her to suffer other losses, injuries and damage. The appellants admitted liability and the claim proceeded to an assessment before Slicer J. On 19 May 1999, his Honour published reasons for assessing the respondent's damages in the sum of $847,900 ([1999] TASSC 57). Slicer J concluded his reasons for judgment:
"Counsel will be afforded the opportunity of making further submissions in relation to the effect (if any) of a Fox v Wood component. The Comcare payments relate to the period ending 1 June 1999. Given that there may be a need to make some minor adjustments in relation to past and future income calculations, counsel are invited to make further submissions and provide additional calculations with respect to this matter."
The trial resumed on 26 May 1999. Counsel for the respondent made submissions and tendered written calculations with respect to the Fox v Wood claim. The then counsel for the appellants made no submissions. In result, the learned trial judge ordered that judgment be entered for the respondent against the appellants in the sum of $929,469.
The appeal
The notice of appeal against that judgment (as amended) contains 17 grounds, although one was abandoned upon the hearing of the appeal. At this stage however, it is convenient to look at a document handed up by Mr Read, who appeared as counsel for the appellants, for it encapsulates the appellants' claims on this appeal.
"The heads of damage under appeal
1 Past lost earning capacity
The base rates of pay set out in the particulars are accepted.
That those rates of pay represent the Plaintiff's pre‑accident earning capacity is accepted.
The challenge relates to
(a)the rates of pay used by His Honour.
(b)calculating damages on the basis of total incapacity for the entire period.
(c)the failure to deduct monies she earned and sick pay received during this period.
(d)the failure to reduce the award for contingencies in more recent years.
2 Fox v Wood
The challenge relates to the fact that all tax paid by the Plaintiff up to the time of trial was allowed when some of it related to wages earned or sick pay received.
3 Future lost earning capacity
The rate of $613 pw net is agreed as is the multiplicand of 337.
The challenge is as to
(a)The fact that the ultimate allowance was for work past 60.
(b)The failure to allow for contingencies particularly the impact dermatitis might have had on the Plaintiff's earning capacity.
(c)The failure to allow for the Plaintiff's retained earning capacity.
4 Future expenses
That the reasonable cost of each of the services claimed is that particularised is accepted.
The challenge is as to
(a)The sufficiency of evidence to support a finding that massage was a reasonable future expense.
(b)The entirety of the allowance for future treatment by a General Practitioner.
(c)The quantum of the amount allowed for psychiatric treatment.
(d)The quantum of the amount allowed for denervation procedures.
5 The overall award
It is to be argued that the judgment sum of $929,469 is so inordinately high as to be a wholly erroneous assessment of the damage suffered."
Some background material
The respondent attained her basic nursing qualifications in 1966. Two years later, she acquired her midwifery certificate. Between 1969 and 1971, she worked as a theatre nurse at St Helen's Hospital but found that the constant use of surgical gloves caused dermatitis on her hands. In early 1971, she transferred to St John's Hospital where she worked principally in the recovery room. However, she still had to do some theatre work. The problem with dermatitis persisted.
In July 1971 she commenced work at the Repatriation Hospital, Hobart in the coronary care unit. In the same year, she undertook an intensive care course at the Royal Hobart Hospital. In 1981 she assumed part time duties as deputy director of nursing at the Repatriation Hospital. The following year the respondent commenced a four year course in nursing administration. In 1982 she gained a diploma in nursing studies and decided to take a break from the course. Her intention was to complete it after the break and pursue a career in nursing administration, but the accident intervened in January 1985.
As mentioned, the respondent returned to work two days after the accident, but neck and shoulder pain with tingling and weakness in the right arm persisted. The pain in the right knee cleared up about six weeks after the accident and she suffered no subsequent disability in that limb. In March 1985 the respondent's general practitioner referred her to a neurosurgeon, the late Dr Graeme Duffy. Initially, Dr Duffy advised a collar, analgesics and periods of time off work, which the respondent took with good result. However, she reported that each time she returned to work in the coronary care unit, the symptoms of neck and shoulder pain with tingling and weakness in the right arm returned.
Overall, the symptoms appeared to worsen and on 20 November 1985 Dr Duffy performed a discectomy and fusion at C5/6. According to a report written by Dr Duffy and tendered in evidence, initially the fusion improved the level of pain in the respondent's neck and arm, but she began to experience pain in the region of the left trapezius.
The respondent returned to work in March 1986. She went to work in the Outpatients Department at the Repatriation Hospital as it was thought that her duties there would be lighter than her duties as a general nurse in the coronary care unit.
Dr Duffy injected the left trapezius with Depo-Medrol on several occasions, but the pain persisted. In March 1986 the respondent began to experience headaches, as well as pain in her neck, shoulders and down the right arm. The level of pain depended on the level of her activity.
Towards the end of 1986 Dr Duffy was of the opinion that the respondent was incapable of working as a nurse and certified her unfit to return to that occupation. However, he was also of the opinion that the respondent was capable of clerical work that allowed her to adjust her activities should they cause symptoms in her neck.
In view of her repeated absences from work, the respondent was reviewed by Dr Young, a Commonwealth Medical Officer for the Department of Veterans' Affairs. In August 1986, his opinion, as expressed on a form in a file maintained by that Department, was that the respondent was then "unfit for continued employment and should be retired on the grounds of invalidity" but may recover and should be reviewed in 12 months. The respondent commenced using her sick leave credits.
The file discloses that during 1987, the Department of Veterans' Affairs considered appointing the respondent to the "unattached list". There was some debate as to whether this proposal was no more than window dressing, having regard to the recommendation that she be retired on the grounds of invalidity.
In mid-1987, Dr Young wrote that his opinion of the respondent's capacity for work was the same as that expressed by Dr Duffy towards the end of the previous year.
It was about this time that the respondent became depressed. On 23 December 1987, the respondent saw Dr Young again. A letter written by him on 5 February 1988 refers to her as being "depressed and tearful". During this period, the respondent's marriage began to break down. In his evidence, the respondent's former husband gave an account of his wife being short tempered, depressed, lacking in motivation and exhibiting signs of neck and shoulder pain; a state of affairs quite contrary to her pre-accident condition.
At this time, the respondent was consulting her general practitioner, Dr Kingston, on a regular basis. On 29 December 1987, he first prescribed an antidepressant drug. On his referral, the respondent consulted the psychiatrist, Dr McCafferty, in March 1988. He treated her for about three to four months, prescribed the antidepressant drug Doxepin and returned her to the care of Dr Kingston. During 1988 the respondent and her husband separated. The respondent described the separation as amicable. Indeed, in 1990, the respondent's husband took her on a trip to Italy to see if the marriage relationship could be restored. However, this did not eventuate, and in 1994, the respondent and her husband were divorced.
Although the letters and notes on the respondent's file maintained by the Department of Veterans' Affairs disclose a belief by officers of the Department that the respondent could be employed in a suitable clerical position, no such position was offered to her by any person in the Department. Correspondence discloses a proposal that the respondent may benefit from a graded, rehabilitative return to work program, but nothing came of this. The respondent retired from the Commonwealth Public Service on the grounds of invalidity on 18 November 1988. In his reasons for judgment, the learned trial judge found that the retirement occurred "during 1987", but the finding is contrary to the records on the Department's file. Nothing turns upon this apparent discrepancy.
Apart from a few hours a week voluntary work, the respondent has not worked since 26 May 1986.
Past lost earning capacity
Mr Read took no issue with any of the foregoing account and accepted that up until the end of 1988, the respondent's physical and emotional condition was such that her earning capacity had been destroyed by the tortious conduct of the first named appellant. In his reasons for judgment, the learned trial judge found with respect to the respondent's condition up until the date of her retirement:
"The symptoms claimed by the plaintiff during this period included migraine headaches, pain to the shoulders and arms, loss of sensation, restriction of movement and depression. The evidence suggests that the whole was greater than the sum of the components, but does not warrant the conclusion that the plaintiff fabricated her complaints. Rather, she lacked the capacity to confront her injury and instead dwelt on her misfortune. That process, once commenced, compounded the problem."
The appellants make no complaint with respect to those findings. In his reasons for judgment, par27, the learned trial judge was critical of the failure of the Department of Veterans' Affairs to try and get the respondent back into the workforce and concluded that passage of his reasons for judgment with this sentence:
"However, the combination of physical injury with her psychological condition and the failure of the employer to properly implement a program of rehabilitation and re-integration requires the Court to make an award fully compensating the plaintiff for past loss."
The appellants attack that finding and submit that, with respect to the period between the end of 1989 and the end of 1995, a period of six years, the respondent failed to discharge the onus she carried of establishing that her earning capacity had been completely destroyed. On behalf of the appellants, it was submitted that the preponderance of the evidence was that during that period, the respondent had the capacity to earn income as a clerk, such as a clerk in the Commonwealth Public Service in a position known as ASO3. At the relevant time, the incumbent of that position earned about 80 per cent of the amount then earned by a nurse holding the same qualifications and experience as the respondent.
At the trial a great deal of medical opinion evidence was adduced. Eight specialists and one general medical practitioner gave evidence, the reports of two others were tendered as separate exhibits, and the reports of yet other medical practitioners are to be found in the files maintained by the Department of Veterans' Affairs and Comcare which went into evidence. The medical opinion was united in the view that after about 1987, the respondent's physical disabilities were such that she had become permanently incapable of working as a general nurse, but was capable of work such as that performed by an ASO3, provided she could move about at will to ease any aches and pains. However, the respondent's claim was that her psychological condition was such that it, combined with her physical disabilities, together effectively destroyed her earning capacity during this six year period.
The evidence was that after the last of her consultations with Dr McCafferty in mid-1988, the respondent did not seek treatment from a psychiatrist until 1996. The learned trial judge found this fact at par10 of his reasons for judgment. Earlier in his reasons for judgment he found that the respondent received psychiatric treatment in 1992, but it was common ground on the hearing of the appeal that that consultation and one or two others in the six year period were for the purposes of this litigation and not for treatment.
In 1994, the respondent moved from Hobart to Melbourne. Accordingly, Dr Kingston ceased to be her treating general practitioner. In March 1996, she consulted Dr Stekelenberg, a general practitioner, who practised in Geelong. She then complained of neck pain and depression. He referred her to a Geelong psychiatrist, Dr van der Linden. The respondent first consulted Dr van der Linden on 17 April 1996. She consulted him thereafter on a regular basis and was doing so at the date of trial.
The appellants' submission was that there was no evidence of psychological impairment between the end of 1989 and the beginning of 1996 and, having regard to the medical opinion evidence that her physical disabilities alone had not completely destroyed the respondent's earning capacity, the learned trial judge erred in making an award, "fully compensating [her] for past loss".
In her evidence, the respondent made it clear that she had made no attempt to find any paid employment during that period.
In 1990, the respondent was reviewed by a psychiatrist, Dr Sale, for the purpose of this litigation. His opinion, given in writing, was:
"There is no psychiatric disorder discernible in this woman.
During 1987/88 the situation was obviously very different. At that time, continuing problems with pain, a deteriorating marriage, and the gradual realisation that she would have to relinquish a greatly valued career led to a significant degree of depression which warranted her general practitioner at the time initiating treatment with antidepressants and arranging a referral to a psychiatrist. Following this intervention, but not necessarily due to it, her attitude towards her problems became more positive and her mood disorder settled. She appears to have remained reasonably stable since then. Notwithstanding the comments that she shows no psychiatric disorder, her manner of coping with her problems shows elements of 'denial' and her lifestyle appears rather unnecessarily restricted. She has been encouraged to participate in voluntary activities but now the situation for her seems to be progressing little further and rehabilitation has come to a standstill.
At present her disabilities seem to flow entirely from her orthopaedic problems and her prognosis therefore is that of her physical disability. I would not regard her as totally disabled and this is to some extent substantiated by her ability to take part in voluntary activities. The pain however is somewhat unpredictable and this would cause practical difficulties in her pursuing any gainful employment."
Dr Sale reviewed the respondent again in October 1995. He was then of the opinion that "there is no psychiatric disorder evident in [the respondent]". In the body of his written report following that review, Dr Sale said:
"She has no psychological complaints. She told me that she felt 'pretty good', and that she tried to adopt a positive approach to her difficulties as life was too short. She believed she had generally stayed on top of things since 1988."
In March 1996, Dr Stekelenburg prescribed the antidepressant Tryptanol. She was taking this drug when she consulted Dr van der Linden. In the history given to Dr van der Linden, the respondent recounted that the antidepressant Doxepin assisted her, and that she "felt better" following her consultation with Dr McCafferty in 1988. The history continued, "up to 1991 she would intermittently use Doxepin for a period of a month or so when she did deteriorate and this appeared to lift her out of her depressions". In his written report dated 11 June 1997, Dr van der Linden's account of the respondent's history continued:
"In 1994 she moved to the Geelong area and coped reasonably well until December 1995 when she received a letter from Comcare saying they were going to cease payment. She appealed and her payments recommenced. In December, 1995 following receival of a Comcare letter she became severely depressed, socially withdrawn, uncommunicative, amotivated, complained of poor concentration and memory, had insomnia and felt life was not worth living, she also said she was continuously tearful."
The foregoing account of the respondent's mental state between early 1989 until December 1995 is consistent with Dr Kingston's evidence. He said, in a generalised way, that between 1987 (two years before the commencement of the impugned six year period) and 1994 when the respondent left for Melbourne, he saw her frequently for pain and depression. He said that antidepressants were prescribed on and off during this period and made a vague guess that antidepressants were prescribed for less than half the time during that period.
In December 1995, an event occurred which the respondent said in her evidence caused her to become "very depressed, tearful, wondering what I was going to do and thought [sic] I just couldn't cope with what was happening". Comcare ceased making weekly payments. Although the respondent said (in answer to a leading question) that this occurred in 1994, the records of Comcare disclose that this happened in December 1995. There was a successful review of this order and payments were reinstated for a short time. They stopped again in March 1996. The respondent was then without weekly payments until November the following year when they resumed. During this time, her income consisted of a disability support pension. The Comcare file discloses that the decision to reinstate payments was made on 1 April 1997 but not implemented until 27 November 1997.
Dr van der Linden expressed the opinion (with the reservation that he "wasn't there") that the respondent's depression was chronic in that it had been present to a degree continuously since 1988. Dr Sale disagreed with this opinion and expressed the view that the respondent's depression was episodic and not chronic. It was his opinion that the onset of depression was reactive to external stressors.
With respect to this difference of opinion, the learned trial judge found:
"Where there is difference between the opinions of Dr Sale and Dr van der Linden, the Court prefers the former."
It follows from that unchallenged finding that the respondent's depression was episodic and reactive to external stressors. The only medical evidence of its existence between the end of 1989 and the beginning of 1996 was the vague evidence of Dr Kingston, to which I have referred. There was no other evidence of depression during the six year period. In addition, the respondent gave some evidence that was inconsistent with chronic depression.
As mentioned earlier, in 1990 the respondent and her former husband went on holiday to Italy for six weeks. The respondent admitted in cross-examination that in 1993, she went to Hong Kong for ten days with a girlfriend. She also agreed in cross-examination that in 1994 she went to Queensland and on a skiing trip to Falls Creek. The latter trip followed a denervation procedure that the Melbourne orthopaedic surgeon, Mr Speck, carried out and which she said gave her on and off total pain relief between June and November 1994. The procedure was subsequently repeated on a number of occasions. With respect to the respondent's travels, the learned trial judge found:
"Her ability to travel might have been accompanied by discomfort, but belies the level of incapacity claimed by the plaintiff in her evidence."
When dealing with the diminution of the respondent's earning capacity in the future, the learned trial judge set out the respondent's physical disabilities and found:
"Those restrictions do not preclude the plaintiff from undertaking restricted work. Her inhibitions stem from psychological fracture and some physical limitation."
He concluded:
"The medical evidence, both physical and psychological, suggests that she has a capacity for gainful employment and that such capacity can be enhanced by continued psychological improvement. The resolution of these proceedings should itself impact on that improvement."
In the light of the matters that I have just set out the learned trial judge's conclusion that, for the whole of the period between the date of the accident and the date of trial, the respondent was entitled to be fully compensated is inconsistent with the finding that the respondent has post-trial capacity for gainful employment. It is inconsistent because the effect of the evidence was that between the end of 1989 and the beginning of 1995 the respondent's psychological state was better than it was at trial and better than it was likely to be immediately post-trial.
Accordingly, the learned trial judge's conclusion that the respondent was entitled to be compensated in full for the destruction of her earning capacity prior to trial is an error, in my respectful view. Ground 3 of the notice of appeal is made out. I shall deal with the consequences of this conclusion in due course.
With respect to the period between the end of 1995 and judgment (entered on 26 May 1999), a period of about 3½ years, there was evidence from Dr van der Linden that he initially changed the respondent's antidepressants back to Doxepin and that this resulted in "significant improvement". Following the initial consultation on 17 April 1996, the respondent saw Dr van der Linden on 13 more occasions over two years. The last consultation as at the date Dr van der Linden gave evidence, was on 29 April 1998. In his evidence, given on 4 September 1998, Dr van der Linden expressed the opinion that the respondent would need to consult him on an average every four to six weeks.
In his evidence, Dr Sale deferred to the opinion of Dr van der Linden with respect to the existence of depression during the time the respondent was the latter's patient. However, given the learned trial judge's acceptance of Dr Sale's opinion over that of Dr van der Linden with respect to the issue of whether depression was episodic or chronic, it follows that the removal of external stressors would, more likely than not, alleviate the symptoms of depression. The Comcare payments did not resume until the end of November 1997. The trial, itself no doubt a stressor, started on 1 September 1998. Although Mr Read correctly submitted that there was no evidence of any stressor in the respondent's life after the Comcare payments resumed, the only conclusion reasonably open to the learned trial judge was that from the end of 1995 until the end of 1997, the respondent's psychological state, coupled with her physical disabilities, effectively destroyed her earning capacity. Further, it would be unreasonable to proceed upon the basis that immediately upon the resumption of payments, the earning capacity returned, particularly with the stress of trial on the horizon. In the context of stress, it is relevant to note that at the same time as Comcare resumed making weekly payments, it claimed back from the respondent, $92,134.52 said to be overpayments made to March 1996, less $20,809.62 being the amount not paid between the date the decision to resume payments was made in April 1997 and the implementation of that decision in November that year.
Even if there was a return of some capacity to earn income between November 1997 at the date of trial, in those circumstances it would have been unreasonable to find that the respondent ought to have utilitised it during that period.
Future lost earning capacity
With respect to the future lost earning capacity, the appellants claim that error occurred:
· in finding that the respondent would have stayed on her career path (ground 4);
· in failing to reduce the award, having regard to the finding that the respondent retained a residual earning capacity (ground 5);
· in finding that the respondent would not necessarily have worked after reaching 60 years, but calculating loss on the basis of retiring at 60 and 65 with varying discounts for contingencies (ground 6);
· in failing to properly take into account contingencies affecting her pre-accident capacity to earn, including her vulnerable personality and tendency to contract dermatitis when wearing rubber gloves (ground 7).
The learned trial judge found that the respondent was "likely to continue in her career until retirement", and that it was "probable that she would have attained a more senior administrative position".
With respect to the assessment of damages for lost earning capacity prior to trial, his Honour repeated those findings and observed that advancement might have resulted in higher remuneration, but added, "[i]t may be that the nature of the personality (insecurity) would have inhibited her advancement and that her further study would not have come to fruition". The latter is a reference to the opinion of the psychiatrist, Dr Pargiter, who considered that before the accident, the respondent had "an insecure but normally well-compensated personality". No error can be detected in the above findings of fact. The learned trial judge considered that one factor inflated her loss and the other diminished it, and accordingly applied no contingency to reduce the assessment of damages for lost earning capacity prior to trial. The respondent had been working at the Repatriation Hospital for nearly 14 years prior to the accident, and although the use of rubber gloves caused her to contract dermatitis, the preponderance of the evidence was that this had not been a problem during the time that the respondent had worked at the Repatriation Hospital. She had a history of continual work and study to advance her career and the findings were made in accordance with that evidence. In my view, ground 4 is not made out.
Grounds 5 and 6 can be considered together. They both relate to the assessment of damages for lost earning capacity after trial. Ground 5 complains that the finding of residual economic capacity is not reflected in the assessment and ground 6 complains of the period of time for which those damages were assessed.
As I have mentioned, the assessment was based upon the assumption that but for the accident, the respondent would have continued "at her present level". I assume by that expression, the learned trial judge meant as a general nurse at a senior level with some responsible administrative duties.
The learned trial judge expressly rejected the respondent's claim that but for the accident, she would have continued to work as a general nurse until aged 65. In this respect, he referred to the evidence of two senior nurses to the effect that nursing duties were so arduous that an older person found them difficult to carry out. His Honour then adverted to the possibility of administrative work but, with respect to this, said, "it does not follow that she would necessarily have worked beyond the age of 60". The learned trial judge then said:
"Against those possibilities are her residual capacity for employment and improvement in her physical and psychological condition. It is impossible to reconcile these opposing possibilities and two methods of assessment suggest themselves. The first is to accept the figures as calculated by the plaintiff and to discount for the contingencies of early retirement and possible future employment. The second is to reduce the claimed period of future employment and to make little further discount for contingencies. On either method, the salary figure of $613, advanced on behalf of the plaintiff, is accepted. The first calculation, based on the current age of the plaintiff of 52 years and nine months is:
520 x 613 = $318,760
Applying a discount for contingencies of 25 per cent, the calculation becomes $239,070. The second method is to assume retirement at 60 and provide a smaller discount for contingencies. The resultant calculation is:
337 x 613 = $206,581.
Applying a 5 per cent discount, the figure is $196,250. Making allowances for error in favour of the plaintiff, a median figure of $217,000 will be awarded."
As I understand his Honour's reasons for judgment, he did not find that the respondent would not have been likely to work past the age of 60 years. I understand his Honour's findings to be that:
· the respondent would not have worked as a general nurse past 60 years, as the work would then have been too arduous for her;
· the respondent may have moved into administrative work in her latter years and thus may have, but not necessarily would have, worked until 65 years of age;
· consequently, a balance must be struck somewhere between the two.
Those conclusions are in accordance with the respondent's evidence, for she said she would have worked "probably 'til, you know, sixty, maybe sixty-five; it would depend on finances and things like that". In my view, ground 6, which complains that the learned trial judge found that the respondent would not necessarily have worked beyond the age of 60, but then made calculations on the basis of a retiring age of 65 and 60, is not made out.
However, in my respectful view, ground 5 is established. Although the learned trial judge referred to the respondent's residual capacity to earn income in the context of assessing her damages for future lost earning capacity, the existence of a residual earning capacity is not adequately reflected in the contingencies that were applied. It would appear from his Honour's reasons for judgment that instead of assuming that the respondent would have ceased work at age 62 years, 9 months, viz, precisely 10 years after the date of judgment, and applying a multiplier for 10 years, the learned trial judge assumed an "ordinary" contingency factor of 15 per cent. He then increased that factor by 10 per cent upon his first calculation and decreased it by 10 per cent on the second calculation. Thus, he arrived at the rounded up figure of $217,000. Had he applied a 10 year multiplier (without discount for mortality) and reduced it by 15 per cent for contingencies, the calculation would have been 452 x 613, less 15 per cent, equals $235,515, a figure not far removed from the assessed figure, and one that makes no allowance for retained earning capacity. (The provisions of the Common Law (Miscellaneous Actions) Act 1986, did not apply to this assessment.) Although there was a possibility of the respondent increasing her earnings, there was also the possibility that her earning capacity might have been adversely affected by her pre-accident vulnerable personality and her tendency to contract dermatitis from wearing rubber gloves. With respect to deduction for contingencies, see Arthur Robinson (Grafton) Pty Ltd v Carter (1968) 122 CLR 649 at 657 - 660; Todorovic v Waller (1981) 150 CLR 402; Dessent v Commonwealth (1977) 51 ALJR 482 [13 ALR 437], Mason and Aickin JJ at 487.
In addition to the evidence to which I have referred with respect to the respondent's capacity to work as an ASO3, earning 80 per cent of a nurse's salary, there was evidence from the President of the Australian Nursing Federation (Tasmanian branch), Ms Wright, that there were a variety of positions in which nurses could work which were of a clerical or administrative nature.
The assessment of $217,000 damages for future lost earning capacity, given a finding that there was no certainty that the respondent would have worked to 65 years of age had the accident not intervened, clearly made no, or no adequate, allowance for the finding that she had residual earning capacity.
I would set aside the award of $419,500 for "Loss of Past Income", meaning, of course, damages for loss of past earning capacity, and the award of $217,000 for "Future Loss of Income".
Ground 1 is a general ground that the assessment of damages is excessive and is very substantially, if not wholly, subsumed in the other grounds. Ground 2 was abandoned.
The remaining grounds of the notice of appeal as filed, grounds 7, 8 and 9, each allege error in "failing to make relevant findings of [certain] facts". As drawn, this would appear to be an alleged error of law in failing to give sufficient reasons for judgment. See Pettitt v Dunkley [1971] 1 NSWLR 376. However, these grounds were argued upon the basis that having preferred the opinion of Dr Sale over that of Dr van der Linden with respect to the issue of whether the respondent's depression was chronic or reactive, the learned trial judge failed to reflect that conclusion in his assessment of the diminution of the respondent's earning capacity, both pre- and post-trial. I have already dealt with these matters and accordingly, there is no need to give separate consideration to grounds 7, 8 and 9.
Some specific complaints
The appellants were given leave to amend the notice of appeal and add a further eight grounds. Each ground deals with a discrete issue in the assessment. It is appropriate to observe before considering each of these grounds that there was a vast difference between the way in which the appellants' case was argued on appeal and the way it was put at trial. Further, the learned trial judge's task on the assessment was not assisted by the submission of varying, and sometimes erroneous, figures and calculations put to him by counsel for the respondent at the trial. By the time the hearing of the appeal concluded, senior counsel for the respondent, Mr Gunson, conceded a number of the new grounds and agreement was reached with respect to correct figures.
Ground 10 is a complaint that the learned trial judge erred in law in basing his assessment of past lost earning capacity on particulars of claim which were not relied on by the respondent.
Upon the assessment of damages for lost earning capacity prior to trial, the learned trial judge said:
The figures put forward by the plaintiff encompass the period 3 January 1985 until 31 August 1998 and amount to a net total of $442,501 (without, it is said, a taxation component). That figure includes the certification and overtime components. The award is based on acceptance of those figures, less the amount deducted for the reduction of the claimed overtime. An additional sum will be added to take into account lost income between 31 August 1998 and 1 May 1999, a sum which is calculated, in round terms, as being $22,000. The award is calculated on a proportion of the claimed figure, less the discount for overtime, plus the amount payable until 1 May 1999. The Court is conscious of the period for which Comcare payments have been calculated and those calculations will be accommodated in the provision of future loss. On the basis of the calculations provided, the award made is:
Loss of income 3/1/85 to 31/8/98 $397,513 Add loss of income 31/08/98 to 01/05/99 $22,000 Total
$419,513"
Mr Gunson conceded that the learned trial judge had been led into error and had used incorrect figures to calculate this aspect of the respondent's claim. Counsel then presented the Court with a correct set of figures upon which this head of damages should have been calculated. The figures assume, in accordance with the finding of the learned trial judge, that for the whole of this period the respondent was entitled to full compensation. The figures have been conveniently broken up into periods which correspond with the submissions put to the Court by Mr Read concerning the respondent's retained past earning capacity. Counsel were agreed that the figures were net after tax and represented "the maximum claim for the plaintiff for past lost earning capacity":
"1 3.1.85 - 1.3.89
base salary
+ 50% OTLess
- time worked
- sick leave$76,076
$7,192
$83,238$15,000
$17,441
$50,7972 2.3.89 - 20.12.89
base salary
+ 50% OT$19,219
$3,639
$22,8583 21.12.89 - 31.12.95
base salary
+ 50% OT$174,959
$11,331
$186,2904 1.1.96 - 31.12.97
base salary
$59,872
5 1.1.98 - 31.8.98
base salary
$20,767
6 31.8.98 - judgment
base salary
+ certification allowanceTotal
$22,000
$3,000$365,584.00"
Ground 10 therefore is established. For the reasons already given, and by reason of the concession made with respect to ground 10, the award of damages for past lost earning capacity is vitiated.
By ground 11, the appellants complain that in the assessment of damages for past lost earning capacity, error occurred in failing to take into account income actually earned by the respondent and sick leave paid by her employer. Mr Gunson conceded this ground as well. The error identified by this ground is corrected in the agreed figures that I have just set out.
By ground 12, the appellants complain that error occurred in the assessment of damages in accordance with the principle set down in Fox v Wood (1981) 148 CLR 438.
This ground is also conceded by the respondent. The hearing with respect to the claim for damages in accordance with Fox v Wood, took place on 26 May 1999, pursuant to leave granted by the learned trial judge on 19 May 1999 when he handed down his assessment of damages on all other heads. His Honour was handed a piece of paper which counsel for the respondent told him represented the Fox v Wood component of the claim. The particulars set out on the piece of paper encompassed the period commencing on 1 July 1984 and concluding on 26 May 1999. The tax claimed under this head included not only tax paid on Comcare payments, but also tax paid on the respondent's salary and sick pay during part of this period. Unfortunately, the error was not detected by counsel who appeared for the appellants on 26 May 1999, for she made no submissions about the matter and thus the learned trial judge was led into error.
On the hearing of the appeal, counsel handed up an agreed calculation of the Fox v Wood claim which totalled precisely $60,000. Initially, Mr Read submitted that if this Court found that during any part of the period prior to trial the respondent had and was able to utilise a capacity to earn income, she should not have received weekly payments for that period. Mr Read submitted that accordingly, the appellants should not have to pay the income tax on those payments. However, he quite properly retreated from that submission when he recognised that the principle to be derived from Fox v Wood is that it was reasonably foreseeable that the respondent would be paid weekly payments as a result of the tortious act, reasonably foreseeable that tax would be paid on those instalments and reasonably foreseeable that upon recovery of a judgment for common law damages, the respondent would have to repay the gross weekly amount, not just the weekly amount she actually received.
I would quash the award of $81,569.45 allowed for Fox v Wood damages and in lieu thereof allow $60,000.
Ground 13 alleges that there was error in allowing $7,000 for the future cost of massage. In her particulars of claim, the respondent sought to recover $30, the cost of a massage, each fortnight, into the indefinite future. With respect to this claim the learned trial judge found:
"The claim for massage is based on a fortnightly session. The Court does not accept that the present number of sessions will be required in future as the calculation does not take into account the contingencies of the natural ageing process or any future improvement. However, the claim does represent a reduction from the claimed present frequency of four sessions per month. It is accepted that there will be a continued need for massage, although not at the rate or duration as claimed. An allowance of $7 per week will be made. The relevant calculation is:
$7 x 1058 = $7,400.
The sum of $7,000 will be awarded in relation to this claim."
On behalf of the appellants, it was submitted that there was no evidence upon which the learned trial judge could find that the future massage was a reasonable need created by the tortious conduct. In her evidence-in-chief, the respondent was asked the following leading question and gave the following answer:
"Have you used massage at all as a means of pain relief? … Yes, I've been having massage since March of 1996."
The respondent went on to say that she had a massage "probably once a week" and that it eased her symptoms for about three or four days thereafter. The only medical evidence indicating the reasonable need for massage was a letter from the respondent's general practitioner, Dr Stekelenburg, written in March 1996, that she needed massage. It is common knowledge that massage can alleviate symptoms of pain. The respondent's evidence was that it did in her case. The learned trial judge obviously accepted that evidence and it entitled him to find that the first appellant's tort created a reasonable need for massage. No further or alternative submission was made with respect to the amount assessed to satisfy this need. In my view, ground 13 fails.
Ground 14 alleges error in allowing the sum of $3,660 for the future cost of consultations with a general practitioner. The learned trial judge's finding with respect to this claimed need was:
"It is clear that the plaintiff will require ongoing treatment from her general practitioner, and the claimed frequency of six visits per year is not unreasonable. The claimed figure of $3,660 will be allowed."
In support of this ground, Mr Read submitted that the only evidence upon which the finding could be based was a written opinion by the orthopaedic surgeon, Mr Browne, who wrote in October 1995 that he thought it reasonable that the respondent should attend a general practitioner "once every three months to receive treatment [and] for the requirement of Digesic tablets".
Contrary to the submission, there was other evidence to support the claim. The respondent gave evidence that she regularly consulted her general practitioner, although not so frequently since she had been consulting Dr van der Linden. She obtained prescriptions from her general practitioner for Digesic tablets. The appellants did not dispute that the respondent suffered from head and neck pain to varying degrees, nor did they dispute that it was reasonable for her to take Digesic. It follows that the evidence clearly established that the first appellant's conduct created a need to consult a medical practitioner at regular intervals into the indefinite future in order to obtain prescriptions for these drugs.
Mr Read alternatively submitted that the allowance should be four visits per year and not six. This is to descend to minutiae and to alter the allowance on this basis would amount to unwarranted appellate tinkering with the award. I would dismiss ground 14.
By ground 15 the appellants complain that error occurred in an allowance of $7,400 for the future costs of consultations with psychiatrists. By her particulars, the respondent claimed $32,512.44 under this head. However, in closing submissions, junior counsel for the respondent corrected some mathematical errors in this claim and ultimately confined it to a consultation every three months. Application of the appropriate multiplier to the appropriate weekly cost of such consultations reduced the claim to $7,400. With respect to it, the learned trial judge said:
"During the course of submissions the amount claimed for future psychiatric treatment was reduced to $7,400. That reduction was an appropriate concession. Given that the effects of future psychiatric treatment should assist in the rehabilitation of the plaintiff and render her more capable of coping with physical restrictions and applying an appropriate 'pain management' regime, the cost is reasonable."
At the outset, it might be observed that if there is a need to consult a psychiatrist, the respondent's need to consult a general practitioner would thereby be greatly diminished. However, the fundamental problem with this head of assessment is that it ignores the learned trial judge's conclusion that he preferred the opinion of Dr Sale to that of Dr van der Linden with respect to the issue of whether the respondent's depression was episodic and reactive.
In the past, a period in excess of seven years passed, during which the respondent had no need to consult a psychiatrist. Although the opinion of Dr van der Linden on the issue of whether there was depression between 1996 and the date the trial commenced, is to be preferred over that of Dr Sale, the cause of that period of depression was identifiable as a reaction to the actions of Comcare and the imminency of the trial itself.
The finding that there exists an indefinite need for psychiatric consultation and treatment once every three months is inconsistent with the conclusion that the respondent's depression is reactive and episodic. There may well be an episodic future need for psychiatric consultation and treatment, but the evidence did not establish the existence of an indefinite need for regularl three monthly consultations. Accordingly, in my opinion, error attended this part of the assessment and the allowance of $7,400 should be set aside.
It is difficult to approach the assessment of this head of the claim other than with a broad brush. Once the reaction to the presently identifiable stressors recedes, a period of years may well pass before some other stressor creates an episodic need for treatment for depression. Doing the best in the circumstances, I would reduce the claim from $7,400 to $2,000.
Ground 16 of the notice of appeal claims that error occurred in allowing $20,500 for the future costs of denervation procedures and a further $1,000 for the future costs of specialist treatment. The evidence was that following the fusion in 1985, the respondent had a number of injections of Depo-Medral in the trapezius, but they gave her little relief from her pain.
On 3 March 1994, she consulted Mr Speck and following some facet join injections, he carried out a facet joint denervation procedure on 27 June 1994 at C4/5 and C6/7 levels on the right. The procedure gave the respondent considerable relief from pain. As mentioned earlier, she went on a skiing trip to Falls Creek following this procedure. The respondent underwent four more denervation procedures between 27 June 1994 and the date of trial, an average of just under one every 12 months.
Mr Speck explained that the procedure destroys the microscopic fibres of the nerve inside the sheath by the application of heat. This prevents the transmission of neurological information from the site of pain to the brain. Over time, the microscopic fibres rejoin and if the cause of pain still exists, the patient will experience pain again. In such a case the procedure can be repeated. Mr Speck's written and oral opinion was that the respondent would be likely to require this procedure to be repeated at intervals of up to six months to two years for about five years post-trial. His opinion was that by that time, the joints that were causing pain would have naturally stiffened and ceased to be productive of pain.
It seems that there was some minor controversy among the medical opinions over the efficacy of this procedure, but the learned trial judge found it to be an appropriate procedure and there is no challenge to that finding.
In the particulars, the future cost of denervation procedures was claimed for life. Upon this basis, the respondent sought to recover $40,706.06. In addition to the cost of the procedure itself, the evidence showed that there was an associated need for post-operative specialist consultation twice per procedure at a cost of $50 per visit. Application of the 3 per cent discount tables for life to this cost produced a claim of $2,032.13.
With respect to this head of damage, the learned trial judge rejected the claim that the respondent would need the procedure for the rest of her life. He said:
"… the calculations advanced on behalf of the plaintiff do not take into account the ageing process or any possibility of improvement. In particular, the Court does not accept that the plaintiff will either require or undergo 30 further such procedures during her lifetime. Applying those conclusions and contingencies, the claim will be reduced by approximately one half. The sum of $20,500 is allowed.
The claim for the payment of a specialist's fee will be dealt with in a similar manner. The need for specialist treatment is said to arise following each denervation procedure. Such is reasonable and a similar discount will be made reducing the claim to $1,000."
At best, the evidence showed that the respondent would be likely to need the denervation procedure five more times post-trial. The cost of each procedure, together with associated specialist visits, is $2,100. This lump sum will have to be paid at yearly intervals over five years. Application of the 3 percent table to find the present value of a single payment of $10,000 in five years time produces the sum of $8,626. Application of the same discount to weekly loss of $40.38 per annum for five years produces the sum of $9,812. An appropriate figure for this loss is $9,200. I would set aside the allowance of $21,500 and substitute the sum of $9,200.
Ground 17 relates to an aspect of the Fox v Wood claim and has been dealt with under ground 12.
Reassessment
In the light of the conclusions I have reached, it is necessary for me to reassess the claim for diminution of earning capacity firstly, for the period of six years between the end of 1989 and the beginning of 1996 during which time the respondent retained earning capacity, and secondly, for the future. This reassessment is based upon the corrected salary figures that the respondent would have earned but for the accident, and which I have set out earlier under ground 10. As I have said, these figures are divided into six periods, which reflect the submissions made by Mr Read. Mr Read accepts that the respondent had no residual earning capacity and that the appellants are liable to pay damages for the whole of the first period. The sum is $50,797. With respect to the second period ($22,858) the respondent regained some residual earning capacity towards the end of it. However, following the completion of her treatment by Dr McCafferty, it would have taken her some time to get back into the workforce and find a clerical position that would enable her to move about when that became necessary. In my opinion, it would not be unreasonable to allow the whole of the sum claimed for this period, upon the basis the respondent would need time before she was able to find appropriate employment. Mr Read did not argue strenuously to the contrary.
The next period coincides with what I have been referring to as the six year period. Had the respondent's earning capacity been totally destroyed during this period, she would, on the corrected figures, have been entitled to recover $186,290.
On the hearing of the appeal, counsel assisted the Court greatly by reaching agreement that the earnings of a clerical assistant, ASO3, were 80 percent of the corrected figures throughout the whole period from the date of the accident until the date of the trial. Thus, if the respondent's residual earning capacity during the six year period included the capacity to work as an ASO3, and she was able to so utilise that capacity, a measure of her damages could have been 20 percent of $186,290.
For the reasons already given, I am satisfied that the respondent did have such capacity. However, allowance must be made for the fact that she may not have been able to gain a position as an ASO3 and would have had to take some other clerical position which may have resulted in a lesser income. However, the evidence and the agreement with respect to an ASO3 is a useful guide in the assessment of this part of the respondent's damages.
Also for the reasons I have given, for the remaining three periods prior to trial, it would be reasonable to conclude that the respondent had no residual earning capacity, largely due to the psychological impact of the decision by Comcare to cease making weekly payments.
In assessing damages for diminution and/or lost earning capacity during the period prior to trial, a modest deduction must also be made for contingencies. At the end of the day, it is an exercise of judgment. Taking into account the matters to which I have referred, I would allow the sum of $240,000 damages for lost and diminished earning capacity prior to trial in lieu of the sum of $419,500.
With respect to the future, I would apply the same reasoning. Bearing in mind of course, that the reassessment is made as at the date of the judgment from which the appeal is brought, I would assess damages for future lost earning capacity for a period of ten years. It was common ground that had the respondent remained in the employment that she was in at the time of the accident, her net weekly income at the date of the trial would have been $613. Assessment of damages for total loss of earning capacity would pay regard to the calculation 613 x 452 = $277,076. This calculation makes no allowance for mortality or other contingencies.
In my opinion, the respondent's residual earning capacity, after making allowances for the difficulties of finding an appropriate position, was, at the date of judgment, or would have been shortly thereafter, in the order of $380 per week net. This is a little more than 60 per cent of what it would have been had the accident not occurred. This is a reduction of $233 per week. 233 x 452 = $105,316. Deducting from that figure 15 per cent for contingencies produces a figure of $89,519. Emphasising again, that the exercise is one of judgment and not mathematics, but an exercise which pays regard to the evidence, I would assess the respondent's damages for future diminution of earning capacity in the sum of $95,000.
Conclusion
No attack was directed towards the other heads of damage other than a complaint that in all the circumstances, the total sum assessed was excessive. The assessment of $45,000 damages for loss of amenities of life and pain and suffering seems reasonable to me. No ground addressed the award made for past and future loss of superannuation although it might be thought that if the award for past and future lost earning capacity was reduced upon the basis that the respondent retained some capacity to earn income, there should be a corresponding reduction in the award for loss of past and future superannuation. It is difficult to make out from the particulars of this claim and the reasons for judgment how the amounts allowed under this head were calculated. No actuarial evidence was given. It's absence was referred to in the closing addresses of counsel, but in an inconclusive way. As no ground specifically addresses the issue of superannuation, and as no submission was made to this Court with respect to it, it would be inappropriate to deal with it under the general ground that the award was excessive. Accordingly, I would vary the award as follows:
| Head of Damage | Judgment | Variation |
| Pain, suffering and loss of amenities | $45,000.00 | Nil |
| Loss of earning capacity prior to trial | $419,500.00 | $240,000.00 |
| Loss of past superannuation | $7,000.00 | Nil |
| Past medical and associated expenses | $75,300.00 | Nil |
| Past household and gardening expenses | $6,200.00 | Nil |
| Future household and gardening expenses | $7,000.00 | Nil |
| Future medical expenses | $39,500.00 | $21,800.00 |
| Future pharmaceutical expenses | $7,400.00 | Nil |
| Future lost earning capacity | $217,000.00 | $95,000.00 |
| Future loss of superannuation | $24,000.00 | Nil |
| Fox v Wood | $81,569.45 | $60,000.00 |
I would allow the appeal and vary the judgment sum from $929,969 to $588,700.
File No FCA 44/1999
DOUG BROWN and STATE OF TASMANIA v CAROL GRACE FALZARI
REASONS FOR JUDGMENT FULL COURT
CRAWFORD J
24 April 2001
I have had the advantage of reading the reasons for judgment prepared by Underwood J. I agree with the reasons and the orders that he proposes should be made in this appeal.
File No FCA 44/1999
DOUG BROWN and STATE OF TASMANIA v CAROL GRACE FALZARI
REASONS FOR JUDGMENT FULL COURT
EVANS J
24 April 2001
I have had the advantage of reading the reasons for judgment prepared by Underwood J; I agree with them.
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