De Blank v Stemberger
[2000] WASCA 358
•22 NOVEMBER 2000
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT : THE FULL COURT (WA)
CITATION: DE BLANK -v- STEMBERGER [2000] WASCA 358
CORAM: KENNEDY J
WALLWORK J
MURRAY J
HEARD: 9 JUNE 2000
DELIVERED : 22 NOVEMBER 2000
FILE NO/S: FUL 186 of 1999
BETWEEN: CATHARINA DE BLANK
Appellant (Plaintiff)
AND
NATALIE ANA STEMBERGER
Respondent (Defendant)
Catchwords:
Damages - Personal injuries - General damages for non-pecuniary loss - Proportion of "a most extreme case" - Adequacy of award for future economic loss
Legislation:
Motor Vehicle (Third Party Insurance) Act 1943 (WA), s 3C
Result:
Appeal allowed
Damages increased from $34,925 to $45,875
Representation:
Counsel:
Appellant (Plaintiff) : Mr J R Criddle
Respondent (Defendant) : Mr K N Allan
Solicitors:
Appellant (Plaintiff) : J R Criddle
Respondent (Defendant) : K N Allan
Case(s) referred to in judgment(s):
Hendrie v Rusli [2000] WASCA 249
Malec v J C Hutton Pty Ltd (1990) 169 CLR 638
Southgate v Waterford (1990) 21 NSWLR 427
Wylde v 'Arriaza, unreported; FCt SCt of WA; Library No 970359; 23 July 1997
Case(s) also cited:
Miller v Jennings (1954) 92 CLR 190
Mullins Investments Pty Ltd v Richard Ellis (WA) Pty Ltd; unreported; SCt of WA (Master White); Library No 8608; 30 November 1990
State Government Insurance Commission v Hitchcock; unreported; FCt SCt of WA; Library No 970089; 11 March 1997
Warren v Coombes (1979) 142 CLR 531
KENNEDY J: I have had the benefit of reading in draft the reasons to be published by Murray J. I am in agreement with those reasons and with the order which his Honour proposes.
WALLWORK J: I agree with the reasons for judgment of Murray J and to the order proposed by his Honour.
MURRAY J: On 9 August 1995 the appellant was driving her motor vehicle on Hay Street, Subiaco. As she entered an intersection controlled by traffic lights, her vehicle came into collision with a vehicle driven by the respondent, which had entered the intersection against a red light. The appellant was fortunate not to suffer serious injury. Apart from soft tissue injuries of a relatively transient kind, the principal injuries were to her left shoulder and both knees. It appears that the right knee was restored to full health within about six to eight months and the left shoulder was again in a satisfactory state by about a year after the accident. It is the left knee which has caused problems of a substantial kind.
The appellant sued for damages for negligence. The respondent admitted liability and damages were assessed in the District Court, judgment being given on 12 November 1999 in the sum of $34,925. The appellant was awarded her costs up to and including 19 April 1999 and the defendant was awarded the costs of the action thereafter. No doubt that order was made for the usual reason. The trial took place on 27 and 28 October 1999.
The award of $34,925 comprised general non‑pecuniary damages of $5,925, $4,000 for future medical treatment and $25,000 for future economic loss. The appeal is brought firstly against the award for non‑pecuniary loss, which was derived from the view of the trial Judge that the appropriate award was 7‑1/2 per cent of "a most extreme case", the mode of assessment prescribed by the Motor Vehicle (Third Party Insurance) Act 1943 (WA), s 3C. The ground gives particular reasons in support of the assertion that to award that percentage was demonstrative of error on the basis that it was substantially below the assessment which ought to have been made in the exercise of a proper discretionary judgment.
Another aspect of the award which is challenged on appeal is the award of $25,000 for future pecuniary loss. Again, having regard to the considerations particularised in the ground, the assertion is that the award is substantially below that which should have been made, having regard to the appellant's age, the likelihood of increased symptoms in the knee in
future, and the impact which such a deterioration would have on the appellant's earning capacity.
Finally, the sum awarded for future medical treatment is challenged upon the ground that the trial Judge erred in limiting the award to the likely costs of an arthroscopy and chondroplasty, and consequential physiotherapy following such procedures. There should have been an allowance, so it is asserted, for the real possibility that the appellant will require a total knee joint replacement.
In such a case as this, damages for non‑pecuniary loss are to be assessed according to the procedures laid down in the Motor Vehicle (Third Party Insurance) Act, s 3C. Non‑pecuniary loss means pain and suffering, loss of amenities, loss of enjoyment of life, the curtailment of expectation of life and bodily or mental harm. By s 3C(2) the damages to be awarded for non‑pecuniary loss are to be a proportion, determined according to the severity of the loss, of the maximum amount that may be awarded. Relevantly to this case, the maximum amount was $219,000. By s 3C(3), however, the maximum amount might only be awarded "in a most extreme case".
In this State the court has adopted as the appropriate considerations in respect of the concepts introduced by the section what was said by the Court of Appeal of NSW in Southgate v Waterford (1990) 21 NSWLR 427: see Wylde v 'Arriaza, unreported; FCt SCt of WA; Library No 970359; 23 July 1997 per Franklyn J, with whom Malcolm CJ and Kennedy J agreed, and Hendrie v Rusli [2000] WASCA 249; 8 September 2000 per Murray J, with whom Pidgeon and Wallwork JJ agreed.
In the latter case at par [18] I endeavoured to summarise the relevant considerations by saying:
"It was accepted that the task was to find the right proportion between a most extreme case and the present. As to what might constitute a most extreme case, it was appreciated that a number of different types of cases of horrific injury involving extreme pain, loss of enjoyment of life, physical disability and the like might fall into that class. Paraplegia would certainly do so, particularly in a young person who might have an unaffected expectation of life and many years of disability and suffering ahead. As to how the right proportion is to be struck, appellate courts have simply reminded trial Judges that damages will continue to be awarded by reference to common law principles of assessment, and that there is, particularly in respect of non‑economic loss, a wide measure of discretion."
It is not suggested for the appellant that his Honour did not understand and properly apply the law as to the process of assessment. What is asserted is that the outcome of an award of 7‑1/2 per cent of the maximum amount is demonstrative of error to a degree which requires correction by this Court, having regard to the circumstances of this case.
The assessment of damages for non‑pecuniary loss also involved the operation of other portions of s 3C. At the time of assessment, pursuant to s 3C(4), the threshold amount prescribed, below which no damages are to be awarded for non‑pecuniary loss, was $10,500. By s 3C(5), if the amount of non‑pecuniary loss was at that time assessed to be more than $10,500, but not more than $33,000, then from the award made was to be deducted the sum of $10,500. Finally, under s 3C(6), if the amount of non‑pecuniary loss was assessed to be more than $33,000, but less than $43,500 (a sum achieved by adding the threshold amount of $10,500 to the amount of $33,000), then the amount of damages so assessed was to have deducted from it a sum derived from a formula set out in the subsection, which the trial Judge rightly described as providing for a deduction according to "a sliding scale".
As to the question of non‑pecuniary loss, the trial Judge found that the appellant was aged 45 years as at the date of the accident. She sustained left and right knee injuries, a left sided curvical spine injury and a left shoulder injury. Apart from the injury to the left knee, the other injuries resolved with conservative treatment within 12 months after the accident. It is clear that it was accepted that there was pain and discomfort and limitation of movement associated with those injuries while their effects lasted. As to the left knee, pain continued and, as his Honour found, particularly having regard to the contribution which may be made by ongoing degeneration in the joint, there is a real likelihood of an increase in the symptom of pain which might, however, be susceptible of improvement by further treatment. I will consider the question of the nature and cost of future medical treatment when I come to discuss the ground of appeal which challenges this aspect of the award.
However, at this point it is necessary to mention that his Honour took into account, as was open to him in my respectful opinion, the advice of the orthopaedic surgeon, Mr Thrum, that, as his Honour put it, "the increase of symptoms of pain can be minimised by the extent of muscle build‑up and particularly quadriceps build‑up which will reduce the symptomatology in the patello‑femoral joint."
The evidence was that the appellant did perform an exercise programme in an endeavour to reverse a process of quadricep wasting which had been noted by medical advisers as being present for some time. However, she felt unable to enjoy recreational activities such as cycling, walking and gardening to the extent that she previously enjoyed. As his Honour found, she obtained little benefit from physiotherapy. It was not suggested that the appellant failed to pursue with reasonable diligence a programme of exercise which might have the benefit of reducing her pain and so, in my view, the significance of this factor for her symptoms in future was limited.
The trial Judge found that the pain she initially experienced in the left knee was "much reduced" following an arthroscopy and chondroplasty which were performed in 1998, but up to the time of the trial the appellant continued to experience a dull aching pain throughout the day. His Honour found that the condition of the knee would not improve and he described it as presenting a "nagging, ongoing disability, but it is one to which the [appellant] can adapt. The [appellant] is left with a permanent although not very significant disability."
As at the date of trial his Honour appears to have accepted that on an average day the appellant could be mobile for two to three hours before needing to rest the knee, at which time she would be compelled to take a 15 to 20 minute break. On occasions, if the pain became severe, she needed to take medication to reduce it. It is clear that it was accepted that there was a restriction in her physical activity on a daily basis, recreationally, in her former work place and generally, which was derived from the nagging pain which she constantly experienced.
For the future, as I have said, it was accepted that with degeneration over time there was a real possibility that the symptoms would become worse. The trial Judge accepted the opinion of Mr Thrum that in that event it would be preferable to approach the question of future treatment conservatively. Only time would tell if future treatment would be necessary at all. There was no marked degenerative process at work. If treatment was required, his Honour found, and in my opinion the findings were reasonably open to him on the evidence, it would be preferable to apply physiotherapy, anti‑inflammatory medication, perhaps a brace and analgesia. If that did not assist, then another arthroscopy and possibly a further chondroplasty might be indicated. Then one might contemplate an operation described as a patellalectomy. If that was required, there were good prospects that it would cause the pain to disappear, but at the expense of a loss of up to 30 per cent of the strength and therefore the function of the knee.
The chance of any such future outcome was obviously something for which compensation was required, but as his Honour put it, the medical evidence suggested that it was unlikely in the appellant's case that such treatment would be required and it was even more unlikely that if such treatment was performed unsuccessfully the stage would be reached where a patellalectomy or total knee joint replacement would be required. What might occur depended upon a number of factors, including the degree of degeneration, the progress of her symptoms, whether the appellant could improve that situation by concentrated effort to improve the musculature of the knee and the success, in fact, of any future treatment which was required and attempted.
It is clear, I think, that his Honour made his assessment of general damages upon the basis of a relatively optimistic view of the appellant's future. He considered the probability of future outcomes which would substantially worsen her situation to be remote. It was, of course, his Honour's task to evaluate the probability of the occurrence of various future hypothetical events impacting upon his assessment: Malec v J C Hutton Pty Ltd (1990) 169 CLR 638. However, even on a best case scenario it was clear from the evidence and upon his Honour's findings that the appellant had experienced, and would continue in future to experience, quite significant pain and a disability which impacted to some degree upon the amenities of her life and caused her a degree of loss of enjoyment of life.
The question then is whether an award of 7‑1/2 per cent of the maximum amount reveals error in the exercise of discretion which requires correction by this Court. Consideration of that question is, of course, performed against the background of what may conceivably constitute a most extreme case, and I remind myself of the difficulty of such an assessment and the high discretionary element involved in the process. Nonetheless, I think that in this case an award of 7‑1/2 per cent of the maximum amount is demonstrably too low.
I am mindful of the fact that the appellant's pain, while not severe, is constant, nagging and a continual presence in her life which causes not a day to pass when she is not required to focus attention upon the difficulty occasioned by the injury to her left knee. For the future, the injury is unlikely to improve. It may worsen. The evidence was to a degree speculative about the type of treatment which might then be required. If, on the most likely outcome, conservative treatment is applied, then as I understand the position, whilst the knee might be rendered less painful, it seems that its condition may not be improved beyond its present state. If, on the other hand, in the unlikely event that the most dramatic treatment proposed, a total joint replacement, was required, whilst that would significantly reduce the painfulness of the limb, it would most probably be at the expense of significant restrictions in the useful capacity of the leg, again a physical disability for the chance of which compensation is required.
Having regard to the age of the appellant and the prognosis, in my opinion, this was a significant, but relatively minor injury creating an appreciable degree of pain and suffering, loss of the amenities of life and loss of enjoyment of life. In my opinion an award of 12‑1/2 per cent of the maximum amount would be appropriate, having the effect of increasing the assessment from $16,425 to $27,375. That is still in the range of awards in which the threshold amount given by his Honour, the sum of $10,500 would be deducted. The award then for this head of damage would be the sum of $16,875.
I turn then to the related question of the award of $4,000 for future medical treatment. I have discussed the options canvassed in the evidence. The allowance made by his Honour was upon the basis that the most likely procedure would be an arthroscopy with a possible chondroplasty, followed by physiotherapy, medication and occasional medical consultations. The award made was of an amount which his Honour thought to be sufficient to meet those future medical costs. As to fixing the present value of the likely cost on the basis that it would not be incurred for some years, his Honour appreciated that the sum awarded was modest and thought it to be not worthy of any reduction by way of discount for early payment.
In my opinion his Honour was entitled to take the view of the evidence that he did. If in future some further surgical procedure was required, it was most likely to be, at some relatively unpredictable future time, a further arthroscopy and chondroplasty. It was, particularly in the opinion of Dr Thrum, unlikely that a total knee replacement would be required in addition to the other procedures described. There was a relatively small chance that it would be necessary and so some allowance was to be made for the costs. If it was regarded as certain and the only question was when in future the knee joint replacement would be required, then on the evidence the cost of future medical treatment would have about doubled. But the chance of such an escalation in future medical costs was relatively small and when, in the future, it might occur was relatively imponderable. The award made by the trial Judge was not discounted for the acceleration of payment. I find myself unable to say that in the final outcome the award made under this head was so far below the exercise of sound discretionary judgment that this Court is required to interfere.
I turn then finally to the award of $25,000, an award of a global kind, in respect of future economic loss. The appellant at the time of her accident had considerable experience in housekeeping in the hospitality industry. In that occupation she was a valued employee and had long experience. As I have mentioned, the plaintiff was aged 45 years as at the date of the accident. By the time of trial she was in her 49th year. No claim was made for past economic loss and so his Honour's consideration was entirely for the future.
The difficulty for the appellant was that her long experience and her attainment of seniority was in Holland. There she had been employed by the Marriott Hotel in Amsterdam since 1976 and by the 1990's she had been appointed Director of Housekeeping for that very large hotel. In that capacity she was responsible for managing the housekeeping budget and for the direction of 120 staff members. She returned to Australia with her partner, a Dutch national, in June 1995 and, as I have mentioned, only a matter of weeks later, before she had obtained employment here, the accident occurred.
Her first employment was at the Radisson Hotel at Scarborough. It was a housekeeping job, but of course not a senior management position. Both her knees and her left shoulder were then troublesome. She held the position until February 1996 when she was made redundant.
She next obtained employment in September 1996 with Australian Housekeeping Systems. She was appointed as the executive housekeeper at the Orchard Hotel, a 300 room hotel where she was required to supervise 30 staff. By October 1997 she had been named Manager of the Year. She was obviously having some difficulty with the injury to her left knee, but was managing. In 1997 she was given the additional appointment of executive housekeeper of both the Orchard Hotel and the nearby Melbourne Hotel. She found that more difficult, but again she managed.
In December 1997 her employer made a new appointment of her as an executive housekeeper at the Burswood Hotel. Here she was not in the most senior housekeeping position. Australian Housekeeping Systems was responsible for 70 per cent of the rooms at the hotel and she directed their 60 to 70 staff, but there was an overall manager of housekeeping appointed by the Burswood Hotel itself. The difficulties with her knee increased because she was spending more time on her feet, but it was during the period of this employment that Dr Thrum performed the arthroscopy and chondroplasty, to which I have previously referred, and this improved her physical situation considerably.
However, as the trial Judge put it:
"By November 1998 she was fed up with her work situation. Apart from the knee problem she was constantly under scrutiny by the Burswood manager and she felt that she had not returned to Australia to endure the treatment which she was receiving. She left her employment of her own volition."
Following that, there was a period of employment, which also ended unhappily, at a cheesecake shop in Victoria Park. I need not for present purposes refer to that in any detail. As at the time of trial the appellant had been unemployed and seeking work only since mid‑1999.
The trial Judge had regard to the medical evidence in so far as it bore upon the appellant's earning capacity. That evidence certainly supported the conclusion to which his Honour came that the appellant would probably be unable to return to work at the bottom end of the housekeeping occupation. All the evidence agreed that work involving repetitive climbing of stairs, walking long distances, repetitive squatting and weight bearing on the knee in that way for any lengthy periods should be avoided.
But the evidence also supported the conclusion that the appellant retained the capacity she had before the accident, with no more limitation upon it than was the case before the accident, to work as a housekeeper in an executive position. She had the experience, she had the physical capacity which was less demanding at that senior level, and she had a strong work ethic. Her capacity to obtain such positions, his Honour felt, was no more limited after the accident than it had been before it occurred. As to her termination of her employment with the Burswood Hotel, it was open to his Honour to find, as he did, that:
"She was constantly under scrutiny and the [appellant] was not prepared to put up with the manner in which she felt she was being treated. Whilst her knee may to some extent have been a problem I conclude that it was only a minor consideration in her terminating that employment."
The question then was, having regard to the probabilities about degenerative change in the knee, the consequential increase in her symptoms and the impact that may have upon her future earning capacity, how long she might retain her present earning capacity and, when the point arrived when her condition commenced to impact upon that capacity, how serious then would be the adverse affect for which compensation was to be provided?
The expert medical practitioners called to give evidence were required to express opinions upon these issues. They ranged from the prognosis that only relatively minor modifications to her work situation would be required to enable the appellant to substantially retain her present earning capacity through to retirement age, to the point of view that she would have difficulty doing so even five years from the date of trial. Regard had to be had also, in considering the opinions expressed, to the fact that there may be a significant component of natural degenerative change in the knee, which would have an impact upon the appellant's earning capacity in any event.
The conclusion to which the trial Judge came "on balance" was that degenerative change in the left knee would, in future, interfere with her work capacity, but not to a significant extent. His Honour thought that there would be no loss of capacity between the ages of 50 to 55, but in the following ten years to retirement at 65, his Honour thought:
"…there may be a progressive limitation on the [appellant's] capacity to undertake work which involves prolonged standing and bending and kneeling. The perimeters of her employment may be marginally reduced and she may be disadvantaged in the labour market which would thus be compensable."
That appears to me, with respect, to be a conclusion which is well supportable by the evidence and, as his Honour said, in those circumstances the compensation was not calculable by accepted mathematical processes. The award of $25,000 was made as a global amount as his Honour said, "taking into account all contingencies". For my part, I feel unable to say that the award under this head of damage was so inadequate as to require the intervention of this Court, particularly bearing in mind the degree of likely interference with the appellant's earning capacity attributable to the accident caused injury and the fact that the award was to be made now to compensate for a loss which might be encountered between 5 and 15 years hence.
In the final analysis I would allow the appeal to the extent necessary to increase from 7‑1/2 per cent to 12‑1/2 per cent of the maximum amount the award made for non‑pecuniary loss, an increase in that component of the award from $5,925 to $16,875 resulting in an increase of the total award from $34,925 to $45,875.
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