Glenys June Witcombe as Executrix of the Estate of Keith Malcolm Witcombe v Talbot and Olivier
[2011] WASCA 107
•29 APRIL 2011
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
TITLE OF COURT : THE COURT OF APPEAL (WA)
CITATION: GLENYS JUNE WITCOMBE as Executrix of the Estate of KEITH MALCOLM WITCOMBE -v- TALBOT AND OLIVIER [2011] WASCA 107
CORAM: PULLIN JA
NEWNES JA
MURPHY JA
HEARD: 12 AUGUST 2010 & 21 FEBRUARY 2011
DELIVERED : 29 APRIL 2011
FILE NO/S: CACV 78 of 2009
BETWEEN: GLENYS JUNE WITCOMBE as Executrix of the Estate of KEITH MALCOLM WITCOMBE
Appellant
AND
TALBOT AND OLIVIER
Respondent
ON APPEAL FROM:
Jurisdiction : SUPREME COURT OF WESTERN AUSTRALIA
Coram :BEECH J
Citation :WITCOMBE -v- TALBOT & OLIVIER [No 2] [2009] WASC 173
File No :CIV 2485 of 2004
Catchwords:
Executors and administrators - Proceedings brought by client's executor against solicitors for negligence and breach of retainer - Survival of causes of action - Whether causes of action vested in client during lifetime - Whether loss or damage suffered during lifetime - Proper construction of s 4 Law Reform (Miscellaneous Provisions) Act 1941 (WA) - Whether executor can recover substantial damages for breach of contract where loss only crystallises upon death - Remoteness
Professional negligence - Solicitors retained to pursue personal injuries claim - Delay in progression of claim due to failure to exercise due care and skill - Client died before matter went to trial - Whether matter would have settled or been determined by judgment prior to death but for negligence - Whether client suffered loss or damage during lifetime
Legislation:
Fatal Accidents Act 1959 (WA)
Law Reform (Miscellaneous Provisions) Act 1941 (WA), s 4
Result:
Appeal dismissed
Category: A
Representation:
Counsel:
Appellant: Mr R I Viner QC & Mr P A Monaco (12 August 2010) Mr R I Viner QC (21 February 2011)
Respondent: Ms C H Thompson
Solicitors:
Appellant: GV Lawyers
Respondent: Tottle Partners
Case(s) referred to in judgment(s):
Allied Maples Group Ltd v Simmons & Simmons (a firm) [1995] 1 WLR 1602
Anderson v Liddy (1949) 49 SR (NSW) 320
Baker v Bolton [1808] 1 Camp 493
Baume v Commonwealth [1906] HCA 92; (1906) 4 CLR 97
Bradshaw v The Lancashire & Yorkshire Railway Company (1875) LP 10 CP 189
Burns v MAN Automotive (Aust) Pty Ltd [1986] HCA 81; (1986) 161 CLR 653
Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54; (1991) 174 CLR 64
Commonwealth v Cornwall [2007] HCA 16; (2007) 229 CLR 519
Corbett v Bond Pearce (a firm) [2001] 3 All ER 769; [2001] Lloyd's Rep PN 501; [2001] PNLR 31
Farr v Shultz (1988) 1 WAR 94
Finlay v Chirney (1888) 20 QBD 494
Fitch v Hyde‑Cates (1980) 2 NSWLR 757
Fitch v Hyde‑Cates [1982] HCA 11; (1982) 150 CLR 482
Griffiths v Kirkemeyer [1977] HCA 45; (1977) 139 CLR 161
Hall v Wilson [1939] 4 All ER 85
Harper v Phillips [1985] WAR 100
Hill v Van Erp [1997] HCA 9; (1997) 188 CLR 159
Jackson v Watson & Sons [1909] 2 KB 193
Johnson v Perez [1988] HCA 64; (1988) 166 CLR 351
Kars v Kars [1996] HCA 37; (1996) 187 CLR 354
Knights v Quarles (1820) 2 Br & B 102
National Australia Bank Ltd v Nemur Varity Pty Ltd [2002] VSCA 18; (2002) 4 VR 252
Nikolaou v Papasavas, Phillips & Co [1989] HCA 11; (1989) 166 CLR 394
Otter v Church, Adams, Tatham & Co [1953] 1 Ch 280
Pearson v Sanders Witherspoon [2000] Lloyd's Rep PN 151; [2000] PNLR 110
Pritchard v Racecage Pty Ltd (1997) 72 FCR 203
Quirk v Thomas [1916] 1 KB 516
Reg Glass Pty Ltd v Rivers Locking Systems Pty Ltd [1968] HCA 64; (1968) 120 CLR 516
Rind v Theodore Goddard (a firm) [2008] EWHC 459
Ryan v Davies Bros Ltd [1921] HCA 53; (1921) 29 CLR 527
Sellars v Adelaide Petroleum NL [1994] HCA 4; (1994) 179 CLR 332
Sharman v Evans [1977] HCA 8; (1977) 138 CLR 563
Smith v Gibson (1998) 21 (SR) WA 5
Sykes v Midland Bank Executor and Trustee Co Ltd [1971] 1 QB 113
Tabet v Gett [2010] HCA 12; (2010) 240 CLR 537
Talbot & Olivier (a firm) v Witcombe [2006] WASCA 87; (2006) 32 WAR 179
The Mediana [1900] AC 113
Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd [1998] HCA 38; (1998) 192 CLR 603
Vinton v Fladgate Fielder (a firm) [2010] PNLR 26
Wardley Australia Ltd v State of Western Australia [1992] HCA 55; (1992) 175 CLR 514
Wenham v Ella [1972] HCA 43; (1972) 127 CLR 454
Woolworths Ltd v Crotty [1942] HCA 35; (1942) 66 CLR 603
Workcover Queensland v Amaca Pty Ltd [2010] HCA 34; (2010) 241 CLR 420
PULLIN JA: I agree with Murphy JA's reasons, subject to one qualification. Murphy JA concluded that the trial judge erred in his construction of s 4 of the Law Reform (Miscellaneous Provisions) Act 1941 (WA). I would prefer to express no opinion on that point, because it was not raised at trial and not raised in a ground of appeal. However, assuming that s 4(1) properly construed, does not preclude the recovery of substantial damages for causes of action in contract where the damage occurs not in the lifetime of the deceased, such a construction does not assist the executrix for the reasons given by Murphy JA. I agree that the appeal should be dismissed.
NEWNES JA: I also agree with the reasons of Murphy JA but, like Pullin JA, I would prefer to express no opinion on the question of the proper construction of s 4 of the Law Reform (Miscellaneous Provisions) Act 1941 (WA). For the reasons given by Murphy JA, nothing turns on the point in this case.
MURPHY JA:
Introduction
This is an appeal against a decision of the learned primary judge in dismissing an action brought by Mrs Witcombe, the executrix of the estate of her late husband, Mr Witcombe, against Mr Witcombe's former solicitors (the respondent solicitors).
Mr Witcombe was seriously injured in a motor vehicle accident on 13 November 1994.
In late 1997, Mrs Witcombe, on behalf of Mr Witcombe (but not as his next friend), instructed the respondent solicitors to act for Mr Witcombe in relation to a claim for personal injuries against the driver of the motor vehicle. The motor vehicle insurer had, in effect, accepted liability.
Mr Witcombe died in 2002, aged 57, before a trial or settlement of his personal injury claim against the driver. Following Mr Witcombe's death, the writ was amended and Mrs Witcombe became a party to the proceedings against the driver in her capacity as executrix to recover such damages as remained recoverable for the benefit of Mr Witcombe's estate pursuant to s 4 of the Law Reform (Miscellaneous Provisions) Act 1941 (WA) (the Act). She also sued the driver to recover her own entitlement, as a dependant, under the Fatal Accidents Act1959 (WA). The amended
proceedings against the driver, in both respects, were settled for a total sum of $825,000 and consent judgment was entered against the driver in that amount.
In the action before the primary judge, Mrs Witcombe, as executrix of Mr Witcombe's estate, alleged that the respondent solicitors had, in breach of duty and in breach of their retainer, not pursued Mr Witcombe's claim against the driver of the motor vehicle with competence or diligence. It was alleged that, by reason of the breaches, Mr Witcombe lost the opportunity of recovering the damages that he would have recovered from the driver at common law, had he not died before the trial or settlement of his claim.
The damages sought against the respondent solicitors corresponded with the damages claimed by Mr Witcombe, before he died, against the driver. The damages sought against the respondent solicitors were pleaded by reference to specified schedules of damages previously filed in the motor vehicle proceedings in January 2002, which set out Mr Witcombe's claims against the driver which, the executrix said, had been lost by the respondent solicitors' negligence (statement of claim pars 10(f), 15(b) and 16(b)). The schedules contained damages claims against the driver in the sum of $5.2 m exclusive of general damages. There was also a general damages schedule, claiming the sum of $232,000.
The damages sought against the respondent solicitors thereby included, in effect, substantial claims which Mr Witcombe had made against the driver for his future care, although there ceased to be a need for such care as a result of Mr Witcombe's death, which was found by the judge to have been sudden and unexpected (that finding in [214] is not challenged). The damages claimed against the respondent solicitors also included Mr Witcombe's claim against the driver for economic loss up to the age of 65 years, and thereby included a claim for the 'lost years'. The damages against the respondent solicitors also included, by reference to the claim for general damages against the driver, damages for Mr Witcombe's pain and suffering, for bodily and mental harm, and for curtailment of expectation of life.
It was contended by the executrix that the settlement sum of $825,000 should be set off against the damages recoverable from the respondent solicitors.
The judge found that the respondent solicitors had breached their duty of care to Mr Witcombe and had breached their retainer with him, as a result of which there was a delay in the prosecution of Mr Witcombe's claim against the driver by 15 to 18 months. However, his Honour held that the executrix had not established any loss from the breaches, in that:
(a)even if, as the executrix alleged, Mr Witcombe would have recovered damages before he died, that fact does not lead to the conclusion that Mr Witcombe suffered loss or damage by reason of the breaches; and
(b)in any event, the executrix had not established that Mr Witcombe would have recovered damages before he died.
The executrix challenges each of these findings in this appeal. For the reasons given below, the appeal should be dismissed.
Section 4 of the Act and observations on s 4
Section 4 of the Act provided, relevantly:
4.Effect of death on certain causes of action
(1)Subject to the provisions of this section, on the death of any person after the commencement of this Act all causes of action subsisting against or vested in him shall survive against, or, as the case may be, for the benefit of his estate …
(2)Where a cause of action survives as aforesaid for the benefit of the estate of a deceased person, the damages recoverable for the benefit of the estate of that person -
…
(b)in the case of a breach of promise to marry shall be limited to such damage, if any, to the estate of that person as flows from the breach of promise to marry;
(c)where the death of that person has been caused by the act or omission which gives rise to the cause of action, shall be calculated without reference to any loss or gain to his estate consequent on his death, except that a sum in respect of funeral expenses may be included;
...
(d)shall not … [subject to exceptions which are not presently relevant] include any damages for the pain or suffering of that person or for any bodily or mental harm suffered by him or for the curtailment of his expectation of life;
(e)shall not include any damages for the loss of the capacity of that person to earn, or for the loss of future probable earnings of that person, during such time after his death as he would have survived but for the [a]ct or omission which gives rise to the cause of action.
…
(5)The rights conferred by this Act for the benefit of the estates of deceased persons shall be in addition to and not in derogation of any rights conferred on the dependants of deceased persons by the Imperial Act 9th and 10th Victoria, Chapter 93 (adopted in Western Australia by the Act 12th Victoria No. 21), as amended by the Act No. 37 of 1900, and so much of this Act as relates to causes of action against the estates of deceased persons shall apply in relation to causes of action under the said Act as it applies in relation to other causes of action not expressly excepted from the operation of subsection (1) of this section.
It is necessary to make some observations about the ancestry of s 4 of the Act and the general law context in which it was enacted. In doing so, I am mindful 'of "the dangers of hastily acquiring" (historical) "knowledge for a special occasion" (Sir William Holdsworth, History of English Law, (4th ed, 1935)' referred to by Rich J in Woolworths Ltd v Crotty [1942] HCA 35; (1942) 66 CLR 603, 620.
'Survival' legislation, of which the Act is a successor, was first introduced in England in 1934, by the Law Reform (Miscellaneous Provisions) Act 1934 (UK) 24 & 25 Geo V c41: Workcover Queensland v Amaca Pty Ltd [2010] HCA 34; (2010) 241 CLR 420 [39].
Survival legislation was enacted against the background of the operation of the general law doctrine expressed in the maxim actio personalis moritur cum persona - 'a personal action dies with the person whether that person be regarded as a possible plaintiff or possible defendant': Woolworths v Crotty (612). As far as the maxim operated with respect to the death of the victim of a tort, the victim's cause of action for personal injuries did not survive for the benefit of the victim's estate: see Woolworths Ltd v Crotty, 612 ‑ 613; Ryan v Davies Bros Ltd [1921] HCA 53; (1921) 29 CLR 527, 532 ‑ 533; Workcover Queensland v Amaca Pty Ltd [34] ‑ [36].
Some exceptions to the maxim developed by which an executor had certain rights to recover damages for damage to the property of the victim of the tort, even though the victim had died: Woolworths Ltd v Crotty (613).
The maxim actio personalis moritur cum persona generally speaking, did not prevent an executor from suing on causes of action in contract. Under the general law the personal representative of the deceased could generally sue in respect of all contracts with the deceased broken in his or her lifetime: Woolworths v Crotty (613 ‑ 614). For example, in 1820, it was held that a cause of action in contract against a solicitor survived for the benefit of the deceased's estate, and could be sued upon by the administrator where there was a breach of the retainer by the solicitor in the deceased's lifetime. This was so even though the claim could have been framed as an action in tort. See Knights v Quarles (1820) 2 Br & B 102.
Nevertheless, where the breach of contract itself caused death, there was a limitation on the damages recoverable by the executor of the estate. In that event, damages were not recoverable in respect of purely personal injuries such as personal suffering or death; damages were only recoverable in respect of damage to the property of the deceased: Woolworths v Crotty (614 ‑ 615).
In Woolworths v Crotty Latham CJ summarised the position, relevantly as follows (617 ‑ 618):
The law with respect to a claim by the representatives of a deceased person in relation to his death, whether brought about by a tort, or by a breach of contract, is summarized in the following passage, which I quote from Quirk v Thomas: 'If the persona mortua be the claimant, his executor cannot obtain any benefit for his estate by acquiring damages which would have been given only as compensation to the living man for injury to his body or to his character. And this rule applies equally whether the claim arises in respect of some tortious injury or in respect of a breach of contract, such as that of a railway company to carry carefully or of a surgeon to perform an operation skilfully. But if the tort or the breach of contract occasion damage to the dead man's property the executor can recover damages, limited to compensation for this special loss.'
…
The above analysis shows, in my opinion, that there were cases of breach of a contract made with a deceased person in which no action was maintainable for damages in relation to his personal injuries such as pain and suffering or in relation to his death. This obviously and admittedly has always been the position in the case of tort (617 ‑ 618).
General law limitations on damages of this nature may be seen in s 4 of the Act: s 4(2)(b) (eg, injured feelings for breach of promise to marry), and s 4(2)(d) (pain and suffering, bodily or mental harm and curtailment of expectation of life).
The general law also further limited recovery in contract by reference to the ordinary principles concerning remoteness of damage: Bradshaw v The Lancashire & Yorkshire Railway Company (1875) LP 10 CP 189, 193, 195; Finlay v Chirney (1888) 20 QBD 494, 500, 507; Jackson v Watson & Sons [1909] 2 KB 193, 204, 207; Quirk v Thomas [1916] 1 KB 516, 534 ‑ 535, 537.
A provision in the nature of s 4(1) does not create a fresh cause of action in favour of the deceased's estate. The cause of action of the deceased and that pursued under a provision such as s 4(1) by the estate are one and the same: Workcover v Amaca [38].
Once a cause of action has been sued to judgment, however, 'a newer, higher and different obligation has been created by the judgment': Ryan v Davies Bros Ltd (533).
The exclusion in s 4(2)(e) of damages for future probable earnings, in respect of the 'lost years', was enacted after it was held that under legislation of this kind, as originally enacted, damages for future loss of earning capacity would survive for the benefit of the estate: see Workcover v Amaca [43], referring to Fitch v Hyde‑Cates (1980) 2 NSWLR 757 and on appeal to the High Court, Fitch v Hyde‑Cates [1982] HCA 11; (1982) 150 CLR 482. See also Harper v Phillips [1985] WAR 100, 101, 105.
In Fitch v Hyde‑Cates, in the New South Wales Court of Appeal and in the High Court, it was held that future probable earnings in respect of the period in which the deceased victim would have lived, but for the negligent conduct causing his death, could not be regarded as a 'loss to the estate consequent on his death' and was not thereby excluded by provisions such as s 4(2)(c) of the Act. In the New South Wales Court of Appeal, Glass JA (771) said:
The cause of action of a negligently injured plaintiff vests in him upon the occurrence of injury and includes at that moment the right to recover damages for the destruction of his earning capacity: Graham v Baker. Damages under this head are calculated with reference to the whole of his prospective earning life, including any period comprised in it of which he has been deprived: Skelton v Collins.
In a different context, but in a related vein, Heydon J, in Tabet v Gett [2010] HCA 12; (2010) 240 CLR 537 [135], observed that it was important to bear in mind the distinction between the loss or damage necessary to found an action in negligence, which is the injury itself and its foreseeable consequences, and damages, which are awarded as compensation for each item or aspect of the injury.
In the High Court in Fitch v Hyde‑Cates, Mason J said (491) the loss of future probable earnings in respect of the lost years is a 'loss of the deceased, not of his estate'.
His Honour said (492) that the reference to 'loss' in a provision such as s 4(2)(c) 'is a reference to the liabilities of the estate which arise only because it is the estate of a deceased person under the general law'.
His Honour also held (492 ‑ 495) that such loss was economic loss, and the references to 'bodily harm' and 'curtailment of ... expectation of life' in the original enactment in provisions such as s 4(2)(d) were not by themselves apt to exclude damages for economic loss.
Economic or pecuniary loss arising from the care needs created in the victim as a result of the tort are also not within s 4(2)(d): Harper v Phillips (101, 105).
The judge's reasons - overview
The first basis upon which the judge dismissed the executrix's action was, in substance, along the following lines:
(a)the action against the respondent solicitors was brought by the executrix of Mr Witcombe's estate;
(b)the action was founded on s 4(1) of the Act;
(c)section 4(1) of the Act provides, in effect, that a cause of action vested in a person at the time of their death survives for the benefit of their estate;
(d)the executrix contended that Mr Witcombe's causes of action against the respondent solicitors which vested in him at the time of his death, and which survived for the benefit of his estate, were in contract and tort (negligence);
(e)a cause of action is incomplete in the tort of negligence until damage is suffered and, at the time of his death, Mr Witcombe had not suffered any damage from the lack of competence or diligence of his solicitors in the pursuit of his personal injury motor vehicle claim, as the motor vehicle claim was not statute‑barred and Mr Witcombe still had all his common law rights against the driver of the motor vehicle; and
(f)in relation to the cause of action against the respondent solicitors in contract, again, at the time of Mr Witcombe's death, any delay or lack of diligence had not resulted in substantial damages because he still then had all his common law rights against the driver of the motor vehicle, although any occasions of breach of retainer would yield a claim for nominal damages against his solicitors, which would survive for the benefit of the estate.
In relation to the cause of action in contract, the judge found ([285]) that 'on a proper construction of the [Act], a cause of action for substantial (that is, not nominal) damages for breach of contract survives and is transmitted to the estate of a deceased under s 4 only in respect of loss and damage suffered by the deceased in his lifetime. Mrs Witcombe did not contend to the contrary'.
In relation to the second basis upon which his Honour dismissed the action, the judge, in effect:
(a)found that the negligent conduct of Mr Witcombe's personal injuries claim against the driver of the motor vehicle added an overall delay of 15 to 18 months to the proper prosecution of the action;
(b)the executrix had nevertheless not established that without the 15 to 18 months' delay, Mr Witcombe's personal injuries claim against the driver of the motor vehicle would have been resolved, by settlement or judicial determination, before he died.
In these reasons, I will refer to the first basis upon which the judge disposed of the case as the 'first issue' and the second basis as the 'second issue'.
The grounds of appeal
Grounds - the first issue
With respect to the first issue, the executrix, in this appeal, contends, in effect, that in relation to Mr Witcombe's vested cause of action in the tort of negligence, the judge erred in failing to find that:
(a)Mr Witcombe had suffered damage arising from the respondent solicitors' negligence, such damage being Mr Witcombe's 'loss of the opportunity to recover damages from [the driver] in [Mr Witcombe's] lifetime' and Mr Witcombe's loss of the use of such moneys;
(b)such damages:
(i)were to be assessed as at the date of Mr Witcombe's death or such earlier time as he would have recovered his common law damages against the driver of the motor vehicle; and
(ii)were to be measured 'by the damages [Mr Witcombe] should have recovered from [the driver] ... taking into account the fact of [Mr Witcombe's] death and the consequent effect of the Act upon the recovery of [his] damages ... had he lived, from the [driver]';
(c)the 'estate' lost 'the damages [Mr Witcombe] would have recovered from the [driver]'; and
(d)the 'estate' of Mr Witcombe 'mitigated its loss by recovering by compromise from the [driver] $825,000 damages under the Fatal Accidents Act1959 (WA)'.
Similar grounds were alleged in relation to the judge's disposition of the cause of action in contract against the respondent solicitors, with the added contention that the judge erred in finding that the solicitors were liable for nominal damages only.
Grounds - the second issue
In relation to the second issue, the appellant contends, in her grounds of appeal, that the judge erred in not being satisfied that Mr Witcombe's claim against the driver would, absent the respondent solicitors' negligence, have been settled or reached the point of judgment before he died. Specifically, it is alleged in effect that:
(a)the findings by the judge in relation to whether a settlement or judgment could have been achieved prior to Mr Witcombe's death failed to take into account all relevant objective evidence, and were against the weight of the evidence; and
(b)the judge ought to have made his own assessment, based on certain findings which he did make, that without a delay of 15 to 18 months, Mr Witcombe would have obtained a judgment against the driver of the motor vehicle before he died.
Preliminary observations on the grounds of appeal and the issues in the appeal
Six preliminary observations may be made about the grounds of appeal, the submissions in support, and the issues in the appeal.
First, although the loss or damage allegedly suffered by Mr Witcombe was the 'loss of the opportunity' to recover damages during his lifetime, counsel for the executrix put the case firmly on the basis that the damages said to be recoverable from the respondent solicitors are the damages Mr Witcombe 'would' and should have recovered from the driver in his lifetime. The executrix emphasised that liability had been admitted by the driver's insurer, and that damages 'would' have been recovered prior to Mr Witcombe's death. It was said that, but for the respondent solicitor's negligence, Mr Witcombe would have recovered (including without the limitations in s 4(2) (d) and (e) of the Act) all the damages to which he was entitled under the common law by verdict or settlement prior to his death. It was not contended that Mr Witcombe had a chance, estimated at less than 50%, of obtaining a settlement, or a judicial award, before he died, and that he lost that chance. The judge said at [339]:
In this action it is an essential integer of Mrs Witcombe's primary damages claim that Mr Witcombe would have recovered damages before he died, by way of settlement or after judgment. Consequently, in my opinion, Mrs Witcombe has the onus to prove on the balance of probabilities that that is so.
It was not contended in this appeal that his Honour misdirected himself in that regard. His Honour made similar observations in [10] and [278] of his reasons.
In this context, the executrix in this appeal expressly accepted as correct the trial judge's formulation of the question, at [343] of his Honour's reasons:
The question is, therefore, whether the evidence satisfies me, on the balance of probabilities, that Mr Witcombe's claim would have been tried and judgment given ... or settled before he died on 24 March 2002.
The answer to that question is the subject of what I have called the second issue.
Secondly, the grounds refer to the 'estate' having 'lost', in effect, the damages to which Mr Witcombe was entitled, whereas the cause of action, which subsisted for the benefit of the estate, was Mr Witcombe's cause of action: Workcover v Amaca [38]. An estate is merely the property which, upon the grant of probate, will vest in the executor of the will; it is not a legal person: Pritchard v Racecage Pty Ltd (1997) 72 FCR 203, 218; Talbot & Olivier (a firm) v Witcombe [2006] WASCA 87; (2006) 32 WAR 179 [31]. Similarly, it is not correct, in point of law, to say that the 'estate' mitigated its loss by an action under the Fatal Accidents Act. The 'estate' had no claim under that statute.
Thirdly, it was, nevertheless, apparent from the parties' submissions that in substance, in economic terms, the compensation being sought by the executrix reflected the future care costs (in some millions of dollars) which Mr Witcombe would, allegedly, have recovered from the driver had Mr Witcombe lived to obtain a settlement or verdict before he died, as well as the damages he would have recovered by way of general damages but for the operation of s 4(2)(d) of the Act. The claim for lost future income in respect of the 'lost years' was, on the other hand, according to the parties, effectively cancelled out by the executrix's proposal to offset, against the claim against the solicitors, the judgment sum received by Mrs Witcombe in connexion with her claim under the Fatal Accidents Act1959.
Fourthly, it was not contended by the respondent solicitors in this appeal that, insofar as the executrix's claims correspond to Mr Witcombe's general damages claim against the driver for pain and suffering, bodily or mental harm or curtailment of expectation of life, the executrix is precluded by s 4(2)(d) of the Act, on its proper construction, from recovering those damages from the respondent solicitors.
Fifthly, in relation to the first issue, the executrix placed particular reliance on the principles in Johnson v Perez [1988] HCA 11; (1988) 166 CLR 351; and Nikolaou v Papasavas, Phillips & Co [1989] HCA 89; (1989) 166 CLR 394. Given the executrix's extensive reliance on those cases, it is convenient to outline the facts and the principles expressed in those cases. In Johnson v Perez, the plaintiff suffered certain injuries in 1968 and 1973 respectively. He instructed one firm of solicitors in respect of his 1968 injuries and another firm in respect of his 1973 injuries. Each firm commenced proceedings on his behalf against the employer. Each action was later dismissed for want of prosecution, at a time when the limitation provisions would have prevented further action by the plaintiff, due to the negligence of the solicitors involved. The plaintiff then sued each firm for negligence and breach of retainer. The plaintiff's claims against the solicitors were tried in 1987. The trial judge held that the plaintiff had had good causes of action against his employers and awarded damages against the solicitors in accordance with awards for personal injury then prevailing (in 1987). The solicitors challenged the primary judge's judgment on the basis that the damages awarded should have reflected the amounts that would have been assessed as at the time when the action against the employers would, but for the negligence, have been determined by a court. The Queensland Full Court rejected the argument and the solicitors appealed to the High Court. There was no dispute that the plaintiff would have succeeded in his claims against his employers had the actions not been struck out. The headnote summarises the reasons of the plurality (Wilson, Toohey and Gaudron JJ) in these terms:
Where a plaintiff loses the benefit of an action he might successfully have brought, but for the negligence of his solicitor in allowing its dismissal for want of prosecution, his loss crystallizes at the date of that dismissal. Since he is not entitled to compensation for loss of the benefit of the action beyond that loss, damages are capable of being quantified at that time, and should be so quantified unless some other date is necessary to provide adequate compensation. Damages recoverable from the solicitor are to be assessed by reference to the amount appropriately awarded when his action would ordinarily have been determined, but for the solicitor's negligence and not to the prevailing award at the time when his claim against the solicitor is determined.
In Nikolaou v Papasavas Phillips & Co, the plaintiff, on behalf of himself and his infant daughter, instructed solicitors to sue for injuries received in a motor vehicle accident in 1976. In 1978, the solicitors filed a claim against the Nominal Defendant, but no claim was made for personal injuries suffered by the plaintiff. The claim with the Nominal Defendant was settled and a release was entered into. The plaintiff's cause of action for personal injuries became statute‑barred in 1979. In 1983, the plaintiff sued his solicitors for negligence in relation to the failure to advise him that he had an arguable personal injuries claim against the Nominal Defendant. It was common ground that the plaintiff would have recovered damages, subject to a 25% reduction for contributory negligence. The primary judge found the solicitors liable for negligently causing the loss of the plaintiff's action against the Nominal Defendant. He found that, but for the negligence, the plaintiff's action would have been determined in late 1979 or early 1980. He awarded damages on the basis of the loss of the plaintiff's cause of action. However, he assessed damages as at the date of judgment in the professional negligence action. The solicitors appealed to the Full Court, which held that damages ought to have been assessed not as at the date of the determination of the professional negligence action, but as at the date when the personal injuries action should have been determined. The plaintiff appealed the decision of the Full Court.
The plurality (Wilson, Dawson, Toohey and Gaudron JJ) held (403) that the cause of action in negligence against the solicitors arose when the limitation period expired 'because the damage flowing from the negligence of the solicitors crystallized at that date'. Their Honours held (404) that damages should be assessed 'by reference to the loss at that date of the right to claim damages', taking into account, inter alia, the 'likely date when in the absence of the negligence of the solicitor the action would have come to trial'. Other factors to be taken into account include the evidence that would have been available to the plaintiff at that time, the relevant principles of law then governing an assessment of damages, the question of contributory negligence, and the prospects of any judgment in favour of the plaintiff being satisfied. In relation to the receipt of evidence concerning the nature and state of the plaintiff's injuries after the date when the cause of action arose, their Honours said (403 ‑ 404)
What has to be assessed as at that date is the value of the claim which was lost by the negligence of the solicitors. In so far as that assessment has to pay regard to the injuries received by [the plaintiff] in the accident and their effect upon him, there is no reason why evidence relating to those matters, subject to their having been foreseeable as likely losses at the date when the cause of action against the solicitors arose, should be excluded by the trial judge. To borrow the words of Lord MacNaghten in Bwllfa and Merthyr Dare Steam Collieries (1891) v Pontypridd Waterworks Co:
'Why should he listen to conjecture on a matter which has become an accomplished fact? Why should he guess when he can calculate? With the light before him, why should he shut his eyes and grope in the dark?'
The evidence would have been received for the purpose of assessing what the appellant had lost, not to determine the amount to which he was entitled had his claim against the respondent been for damages for personal injuries.
The sixth and final preliminary observation is this. There is no challenge to the judge's findings that the case was not put in the court below ([327(b)], [332]), and nor was it contended in this appeal, that at some point in time prior to Mr Witcombe's death, during the course of the respondent solicitors' retainer, it had become apparent that he had only a short time to live, and could not hope to finalise his claim during that period. A claim of that kind would likely have raised for consideration issues not dissimilar to those which arose in the English case of Pearson v Sanders Witherspoon [2000] Lloyd's Rep PN 151; [2000] PNLR 110. In that case, solicitors were retained by a client in 1988 to bring proceedings against a defendant company. The defendant company was in some financial difficulty in 1989, although it survived the setback and undertook a successful rights issue in 1990. There was delay in the prosecution of the action. In 1992, the client changed solicitors and instructed a second firm of solicitors. Eventually, the plaintiff's claim went to trial in 1996, by which time the defendant was insolvent and had no assets. The client sued both firms of solicitors for failing to bring the proceedings timeously so as to allow him to obtain judgment before the defendant's liquidation and to recover, thereby, substantial damages. The trial judge dismissed the claim against the second firm of solicitors, but held that the first firm of solicitors were liable on the basis that from the inception of the retainer, there was a foreseeable, in the sense of not just a fanciful, risk that the defendant might go into liquidation, and awarded substantial damages against the first firm of solicitors accordingly, with only a modest discount for the contingency that the defendant company may have lacked the ability to pay a judgment debt. In overturning the trial judge's decision against the first firm of solicitors, the Court of Appeal held that whilst the solicitors were in breach of duty, their liability for the consequences resulting from the defendant company's insolvency could only fairly be assessed from the time it became apparent, in August 1991, that the defendant was in serious financial difficulty. At that point, the solicitors should have pressed for the matter to be brought to trial swiftly. The failure to do so was the relevant causative breach. That course, had it been taken, would likely have resulted in judgment at a date in June 1993, prior to the defendant's liquidation, but only shortly before (six months or less) its receivership. The assessment of the chances of recovering the fruits of judgment were to be viewed in that light, and the chances of recovery then were only 50/50.
The Fatal Accidents Act
It is convenient to mention, at this point, the Fatal Accidents Act1959 (WA) to which the executrix makes reference in her grounds of appeal. References to that statute are references to the statute as it stood in March 2002 (although it is not suggested that more recent amendments are presently material).
Under the general law, the death of a human being could not be complained of as an 'injury': Baker v Bolton [1808] 1 Camp 493. The rule was explained in Woolworths v Crotty by Latham CJ in these terms (615):
The rule in Baker v Bolton applies to prevent an action by A against B for damages for the death of C, caused by the tortious act of B. In other words, the rule dealt (so far as the subject of tort is concerned) with the question of the right of a third party to recover compensation for loss incurred by him as the result of the death of a person killed by the defendant's tortious act.
As Professor Fleming in 'The Law of Torts' (9th ed) (730) observed, the advent of railways and the concomitant increase of fatal accidents gave the impetus to reform. In 1846, a statute generally known as 'Lord Campbell's Act' (of which the Fatal Accidents Act is a successor) was enacted to provide the dependants of a deceased with a measure of protection when a tortfeasor caused the death of the person upon whom they were financially dependent. In Woolworths v Crotty, Latham CJ (618) said:
Lord Campbell's Act deals only with the case of death, not with personal injuries not resulting in death, or with damages for such personal injury, such as pain and suffering, even where death resulted. It created an entirely new cause of action in the representatives of a deceased person. The action was for the benefit of specified dependants who had suffered pecuniary loss by his death, but who could not complain that the defendant had committed a tort as against them, or that he had broken any contract with them. It was a condition of the right of action that the deceased would have had a right of action, if death had not ensued, to recover damages in respect of the wrongful act, neglect, or default which was the cause of the death. But the right of action given to his executors is quite distinct from any right of action that the deceased would have had. It is a purely statutory creation for the purpose of filling what was regarded as a gap in the law.
The proper party to sue is, in the first instance, the executor or administrator: s 6(1B), but see also s 9. That person does not, however, sue as a representative of the deceased, but rather as a fiduciary of the dependants: Anderson v Liddy (1949) 49 SR (NSW) 320. The damages recovered are not part of the estate: Hall v Wilson [1939] 4 All ER 85, 96.
At the time of the enactment of Lord Campbell's Act, the English legislature had not enacted the 'survival' legislation.
Section 4(5) of the Act provides, in effect, that causes of action which survive by virtue of s 4(1) are in addition to and not in derogation of rights conferred on dependants under the Fatal Accidents Act.
Disposition of the appeal
Disposition - the second issue
It is convenient to address the second issue first.
Background facts
The following findings of fact and matters are relevant by way of background and, unless otherwise indicated are taken from the judge's reasons [18] ‑ [27], [43], [47], [70], [107], [141] ‑ [146], [156], [200] ‑ [201], [203] ‑ [217], [346] ‑ [360].
Mr Witcombe first consulted a firm of solicitors (original solicitors) in late 1994. In 1996 the insurer advised the original solicitors that, in effect, liability would not be denied if the claim was settled or the proceedings were commenced before the expiration of the limitation period.
By August 1997, Mrs Witcombe was concerned with the delay in the prosecution of the action by the original solicitors. In late August 1997, on behalf of Mr Witcombe, she terminated the previous retainer and instructed the respondent solicitors. The respondent solicitors did not recover the file from the original solicitors until 13 March 1998. From the start, and throughout, Mrs Witcombe's instructions were that she wanted to care for her husband at home. (I note that Mrs Witcombe's written instructions dated 21 April 1997 to the original solicitors were to this effect (GAB 237).) Also, in this appeal, the executrix in her written submissions said:
It was the fact that Mrs Witcombe wanted to care for her husband at home. Mrs Witcombe was a retired nurse. She had the natural desire to care for her husband. He wanted to be at home.
In March 1998, the respondent solicitors spoke to Mrs Witcombe and discussed, inter alia, Mr Witcombe's accommodation needs with respect to architectural evidence then being sought from an architect, Mr Keen. Mr Keen had mentioned to Mrs Witcombe that 10 years would be deducted from Mr Witcombe's ordinary life expectancy as a result of the accident. Mrs Witcombe told the respondent solicitors that she did not agree with that suggestion.
By December 1998, the insurer had raised with the respondent solicitors the question of Mr Witcombe's competence to conduct litigation on his own behalf.
In early December 1999, Mr Witcombe had moved, at his family's request, into group housing accommodation run by the Brightwater organisation, at Balcatta.
On 22 June 2000, the respondent solicitors wrote to Dr Ker, a specialist physician in rehabilitation medicine, requesting a report in relation to, amongst other things, Mr Witcombe's disabilities and future treatment needs, and his life expectancy in the light of his injuries. Prior to the termination of their retainer, the respondent solicitors did not receive a report from Dr Ker, and the respondent solicitors took no steps to chase up a report.
On 3 July 2000, the respondent solicitors also wrote to Ms Sharp, an occupational therapist, in relation to the annual cost of meeting Mr Witcombe's medical and associated needs, including a carer and domestic support, physiotherapy, occupational therapy and the like.
On 18 July 2000, a writ was issued on behalf of Mr Witcombe in the District Court, but not served.
In April 2001, Mrs Witcombe, on behalf of Mr Witcombe, terminated the respondent solicitors' instructions and engaged a new firm, D'Angelo & Partners (D'Angelo), to take over conduct of the matter.
D'Angelo served the writ in May 2001, and filed a statement of claim in June 2001. D'Angelo entered the action for trial on 7 January 2002. On 30 January 2002, D'Angelo filed schedules claiming damages totalling approximately $5 million.
On 30 January 2002, D'Angelo spoke to the solicitor for the insurer and advised that D'Angelo were awaiting reports from Dr Ker (specialist rehabilitation physician), Dr Beel (general practitioner), Brightwater (accommodation organisation) and Dr Linda Hayward (neuropsychologist).
Also on 30 January 2002, the insurer's solicitor advised the insurer that he needed to see all the evidence and the schedules, before advising on the need for further evidence, and before advising on quantum.
The schedules of damages dated 30 January 2002 were served (I note the letter of service was dated 7 February 2002).
On 4 February 2002, Dr Ker (who was first asked for a report on 22 June 2000) provided a report, stating, inter alia, that Mr Witcombe's affairs would best be managed by a court‑appointed trustee, and that the services of a next friend would be valuable. (Although not specifically mentioned by the judge, Dr Ker did not address, as requested by the respondent solicitors in their letter of 22 June 2000, the question of life expectancy.)
A pre‑trial conference was held on 13 February 2002 at which D'Angelo indicated that they were seeking further reports from Dr Ker, Dr Beel and possibly Brightwater.
On 15 and 18 March 2002, D'Angelo advised the insurer's solicitor that they were awaiting Dr Hayward's report, and further reports from Dr Ker and Brightwater. The two solicitors agreed that a pre‑trial conference scheduled for 27 March 2002 should be rescheduled and that, in the meantime, an informal date for settlement discussions should be arranged for April. It was proposed that the formal pre‑trial conference be adjourned to May. The insurer's solicitor advised D'Angelo that a further medical review of Mr Witcombe might be necessary, but that he (the insurer's solicitor) had not yet advised the insurer on that issue.
(Although not specifically mentioned by his Honour, the reference to further reports from Dr Ker is a reference to letters written by D'Angelo on 18 February 2002 and 15 March 2002 seeking further reports from Dr Ker in relation to Mr Witcombe's future medical care. In the former letter, D'Angelo wrote (GAB 387):
We note that ... the previous solicitors for Mr Witcombe had directed a number of issues to you in relation to [Mr Witcombe's] future treatment and care.
We would appreciate if you could expand on what you believe would be the ongoing needs of Mr Witcombe in relation to future treatment and your assessment of the estimated number of visits that would be required in relation to appointments with his general practitioner and specialist ...
In addition, the likely ongoing physiotherapy and speech therapy that he would need ...
We further would appreciate your comments in assisting with the assessment of the claim that whether in light of the history of Mr Witcombe's injuries and treatment that he would clearly benefit from a mental and physical point of view from living at home if possible with the assistance of carers as opposed to institutional care. As you may be aware Mr Witcombe has indicated a clear wish to return to live at home.
D'Angelo also enclosed a further copy of the respondent solicitors' letter to Dr Ker dated 22 June 2000.)
At this time (around March 2002), the insurer's solicitor considered that the question of whether Mr Witcombe should be looked after at home or in a medical institution would have a significant bearing on the likely award of damages, and that evidence bearing on that issue would be a significant part of assessing the likely quantum of Mr Witcombe's claim. (Although not specifically mentioned by the judge, that finding was made in the context that the insurer had received a report from Dr Fong dated 8 February 1996 which stated, inter alia, that it was likely that Mr Witcombe would require 'long‑term institutional care' (GAB 120).)
Given Dr Ker's comments in his report of 4 February 2002, the insurer's solicitor would not have recommended to the insurer that it settle Mr Witcombe's claim without a next friend being appointed, the opinion of independent counsel being obtained, and any proposed settlement being the subject of an application for compromise by the court.
On 18 March 2002, Dr Beel, a general practitioner, provided a medical report to D'Angelo. Dr Beel said, with reference to Mr Witcombe's lifespan, that:
[It] is liable to be reduced by his disabilities as he is more prone to intercurrent infections, thromboses due to inactivity etc but it is impossible to quantify this.
On 21 March 2002, Mr Witcombe was admitted for dental surgery under general anaesthetic. He died from aspiration pneumonia on 24 March 2002. His death was sudden and unexpected. None of Mrs Witcombe, other members of the family, Mr Witcombe's legal advisers or his doctors had any sense that Mr Witcombe's death was or may have been imminent.
As at 24 March 2002:
(a)D'Angelo were awaiting further medical reports;
(b)the insurer's solicitor had not provided advice to the insurer on quantum;
(c)no final decision had been made on whether a next friend would be appointed for Mr Witcombe;
(d)no decision had been made on whether the insurer would accept that Mr Witcombe could be cared for at home; and
(e)the insurer's solicitor had not made any recommendations to the insurer about whether Mr Witcombe needed to be examined by other medical practitioners.
The insurer's solicitor would have recommended to the insurer, had Mr Witcombe not died, that the insurer obtain evidence on the issue of Mr Witcombe's future care, including whether he should be cared for at home.
The insurer would have obtained evidence of life expectancy if Mrs Witcombe had maintained that there should be no reduction for diminished life expectancy.
In this context, although not specifically mentioned by his Honour, the insurer's solicitor had written to the insurer on 14 June 2001 reporting that the insurer's solicitor had previously indicated to the respondent solicitors that it was likely that the insurer would want Dr Fong to review Mr Witcombe and comment, inter alia, on his future treatment requirements, and his life expectancy.
It may also be noted that on the question of the insurer's position with respect to life expectancy, there was the following exchange in the cross‑examination of the insurer's solicitor, Mr O'Sullivan, by counsel for the executrix:
And we dealt with life expectancy. That required a report from someone such as Dr Fong?‑‑‑Yes.
Indeed, Mr Ker had been asked in June 2000 to advise on life expectancy but never did, so it required ‑ ‑ ‑?‑‑‑Apparently, yes.
It required advice from some other appropriate specialist?‑‑‑Absent Dr Ker, yes.
Accordingly, at the time Mr Witcombe died, a number of further steps still needed to be completed before the action could have been ready for settling, or proceeding to trial.
Having found that following the receipt of the medical reports and, in particular, the reports of Dr Ker dated 4 February 2002 and Dr Beel dated 18 March 2002, a number of the matters referred to above were still required to be done, the judge then directed further attention to the position and attitude of Mrs Witcombe and of the insurer.
With respect to Mrs Witcombe, his Honour held, in effect, that:
(a)Mrs Witcombe had a firm position on matters likely to have been at issue in a compromise;
(b)in this regard, Mrs Witcombe's instructions had consistently been to the effect that she did not accept that Mr Witcombe's claim should be reduced on account of diminished life expectancy;
(c)Mrs Witcombe intended to care for Mr Witcombe at home irrespective of whether an award for damages included home care; and
(d)the combination of the preceding two matters may well have led to a particular reluctance on the part of Mrs Witcombe to compromise on the question of damages.
With respect to the insurer's likely position as to compromise, the judge made the following findings (reasons [349] ‑ [351], [354]):
In cross-examination it was put to Mr O'Sullivan [the insurer's solicitor] that there was a general policy that it was preferable for disabled people to live in the community rather than in institutional care. Mr O'Sullivan did not agree in terms with that proposition. He said that there needs to be a balance between the needs of a plaintiff and the interests of a defendant, that it was a question of reasonableness, and that each case needed to be considered on its merits (ts 445). I take Mr O'Sullivan's answer as reflecting the approach that he would have taken in 2001 and 2002.
In the course of cross-examination it was put to Mr O'Sullivan that a difference between $110,000 per annum for institutional care and $143,000 for home care was 'a readily bridgeable gap if the parties were seeking to compromise' (ts 447). Mr O'Sullivan did not in terms express agreement (or disagreement) with that proposition. He said that the significance of a difference like that would be influenced by Mr Witcombe's life expectancy, as well as the cost of home modification.
Mr O'Sullivan was taken through most of the heads of damage claimed by Mr Witcombe and invited to identify those where he thought issues were likely to have arisen (ts 461). The major area that would have required at least consideration, discussion and further evidence was the question of future care, including whether Mr Witcombe should be cared for at home, the cost of home modification, and future medical needs. Other matters requiring further consideration and discussion included the claim for gratuitous services and the claim for a vehicle (ts 461).
It was put to Mr O'Sullivan that in Mr Witcombe's case it was more likely than not that a compromise would have been reached (ts 462). Mr O'Sullivan's response was 'I don't think I can answer that'. He referred to the fact that statistically most cases settle and in that sense it was more likely than not, but, he said, in this particular matter there was still further evidence to come forward and issues of capacity, life expectancy and future care outstanding (ts 462).
The judge accepted Mr O'Sullivan's evidence [216].
The judge was not satisfied in all the circumstances that, on the balance of probabilities, Mr Witcombe's claim would have settled as alleged.
The judge also found that the considerations which led him to the finding that he was not satisfied that a settlement would probably have been reached, also led him to conclude that he could not find, on the balance of probabilities, even in a broad way, the level of quantum which would have been acceptable to both parties by way of a compromise.
On the question of whether Mr Witcombe's motor vehicle action would have reached trial and been determined by a court prior to his death, the judge found that the executrix had not led evidence of the likely time between entry for trial and trial dates in the District Court from mid‑2000 to 2002. In the absence of such evidence, his Honour was not satisfied that Mr Witcombe's action against the driver would have proceeded to trial and a judgment obtained before his death.
The effect of the respondent solicitors' negligence
The judge also made the following findings (reasons [345], [346], [360]). The respondent solicitors' negligent conduct caused an overall delay of 15 to 18 months in the 'progressing and preparation of the claim by writ, statement of claim, schedule of damages and gathering expert evidence'.
Had Mr Witcombe, through the respondent solicitors, made and quantified a claim on the insurer in 2000, it would have been in the region of $3 million in accordance with a document entitled 'Heads of Damage as at February 2000', which counsel for the executrix handed up to the judge at the trial of the action against the respondent solicitors.
(The 'Heads of Damage' document referred to a total claim of approximately $3.2 million. It was not tendered as evidence, but was handed up by counsel for the executrix as an 'aid' on the basis of it being 'a reworking of the schedules filed in 2002' in the motor vehicle action (ts 63).)
Although not mentioned by the judge, the 'Heads of Damage' document included schedules of items of future costs and expense purportedly based on ordinary life expectancy (described in some schedules as a further 22.08 years and in others as 26 years), with a 20% discount for contingencies. The sums in respect of these items, after deducting the 20% for contingencies, were, approximately:
•Special aids and equipment - $193,000
•Future travel expenses - $14,000
•Vehicle replacement and maintenance costs - $100,000
•Future care needs - $1,500,000
•Future medical expenses - $209,000
The schedules also identified a claim for future economic loss of $258,000 and general damages of $219,000. It also included a sum in respect of home modification and renovations of $264,000, which would not have been required if Mr Witcombe were not to be accommodated at home.
It is not clear whether the 'Heads of Damage' document for approximately $3 million was intended by the executrix, in effect, to amend the pleaded claim against the respondent solicitors that Mr Witcombe had lost claims totalling $5.2 million plus general damages against the driver.
The executrix's arguments in this appeal
The executrix advanced two principal contentions. The first is to the effect that the judge's finding that he was not satisfied that the executrix had proved on the balance of probabilities that the motor vehicle action would have been settled or been determined by judgment prior to Mr Witcombe's death, was against the weight of the evidence and failed to take into account relevant evidence. The second relates to judgment rather than settlement. It is to the effect that the judge made findings of fact from which he should have inferred that the motor vehicle claim would have gone to trial and been determined prior to Mr Witcombe's death.
In advancing both of these contentions, the starting‑point for the executrix was that, having regard to the judge's finding ([346]) of a 15 to 18‑month delay, the judge impliedly found that the respondent solicitors, absent negligence, would have progressed the claim to the point that it was ready for entry for trial, or settlement, by no later than November 1999 (appellant's further submissions 13 September 2010, par 9).
The judge's reasons do not indicate that. There is no express finding that the case would have been ready for entry for trial, or compromise, by November 1999 but for the negligence. The finding is that there was a delay of 15 to 18 months in the 'progressing and preparation of the claim'. It is a finding to the effect that in the period of approximately 4½ years up to the date of Mr Witcombe's death on 24 March 2002, there had been a 15 to 18 months' delay caused by the respondent solicitors' failure to act with reasonable care. As at 24 March 2002, further steps still needed to be completed before the action would have been ready for settling or proceeding to trial. The executrix advanced the date of November 1999 as the date on which the motor vehicle claim would have been ready for entry for trial on the basis that it was approximately 15 months prior to the cessation of the respondent solicitors' retainer in February 2001. The logic behind that approach would appear to be based on the premise that in February 2001 the motor vehicle claim was otherwise ready for entry for trial. The judge's findings and the evidence do not justify that proposition (see [67] ‑ [87] above).
Accordingly, the starting‑point advanced by the executrix is not correct. Even if it were correct, however, none of the other matters relied on by the executrix, separately or in combination with that starting‑point, demonstrate error by the judge.
On the specific question of whether the executrix had proved that settlement would have been achieved as alleged, the executrix, in substance, pointed to seven matters or circumstances which, she said, indicated that the judge had erred in fact or in law.
First, it is said that the judge 'misconstrued ... the circumstances surrounding the evidence of life expectancy'. The executrix refers in this regard to his Honour's finding at [352] (which finding is unchallenged) that D'Angelo had not obtained all the medical evidence they required on life expectancy by the time of Mr Witcombe's death. It is said that his Honour failed to appreciate that D'Angelo only required evidence on life expectancy because of the respondent solicitors' initial delay in seeking Dr Ker's opinion. It is said in effect that had there been no delay in seeking Dr Ker's opinion, there would never have been any further need to contact Dr Ker for advice. That submission cannot be accepted. Dr Ker had failed to provide an opinion on life expectancy, despite it being one of the questions raised by the respondent solicitors in their letter dated 22 June 2000. It could not be inferred that his failure to address that topic was in any way any related to the date the letter was sent. Also, the evidence sought by D'Angelo from Dr Ker included other information by way of clarification and elaboration with reference to the respondent solicitors' letter of 22 June 2000. Moreover, there was no evidence of what Dr Ker's opinion on life expectancy would have been, or of what his response would have been in respect of the other matters raised. Accordingly, there was no evidence of what Mrs Witcombe's likely attitude, and consequent instructions, would have been in relation to Dr Ker's advice on matters of that kind, or what the insurer's likely attitude and position would have been. Accordingly, the fact that the respondent solicitors had delayed in instructing Dr Ker does not of itself assist the executrix in establishing that the judge erred in finding that he was not satisfied that a settlement would have been reached prior to 24 March 2002.
The second circumstance referred to by the executrix is related to the first. It is said that the judge did not take into account that the respondent solicitors should themselves have sought expert evidence from Dr Ker on life expectancy in March 1998. Again, this point in substance refers to the delay of the respondent solicitors in seeking Dr Ker's opinion. For the reasons given above, it does not establish that the judge erred in his finding on the issue of whether a settlement would have been reached.
The third circumstance relied on by the executrix is that there was no unreasonable delay by D'Angelo in carrying out Mrs Witcombe's instructions. That point does not demonstrate error by the judge of the kind contended for by the executrix here.
The fourth matter referred to by the executrix is expressed in the following terms:
In respect of [the insurer's] response to a claim for future care, including homecare, the solicitors for the parties would be guided by the principles and considerations expressed in Smith v Gibson ... and the evidence already exchanged.
That submission does not assist the executrix. In Smith v Gibson (1998) 21 (SR) WA 5, after referring to a number of authorities, including Sharman v Evans [1977] HCA 8; (1977) 138 CLR 563, 573 ‑ 574 and Farr v Shultz (1988) 1 WAR 94, 122 (both cases in which the costs of home care were not allowed), Yeats DCJ said, with reference to the facts of that case (22):
There is no dispute about the desirability that the plaintiff live independently in the community. No‑one contends that the plaintiff requires institutional care. On the contrary, the medical experts concurred in the view that as a matter of policy disabled people should remain in the community and live their lives as independently as they are able to do. There also seemed to be a concurrence of views that the plaintiff has been managing to achieve quite an extraordinary level of success in the independent and varied life he leads and the interests he is able to pursue despite his severe disabilities. His personal determination and his intelligence have undoubtedly served him well.
The existing care regime the plaintiff has enjoyed since release from the rehabilitation centre is accepted by all medical experts as reasonable, not excessive and, as conducive to the plaintiff's maintenance of his independent and varied lifestyle.
The decision in Smith v Gibson directs attention to the question of the reasonable requirements of an injured plaintiff having regard to the particular facts and circumstances of the case. The decision itself provides no guidance on whether Mr Witcombe's claim would have been settled and if so, when or on what terms. Moreover, the decision was put by the executrix in cross‑examination of the insurer's solicitor. His Honour referred, in summary form, to Mr O'Sullivan's evidence in his reasons at [349] ‑ [351] and [354], referred to in [89] above. As noted earlier, the judge accepted Mr O'Sullivan's evidence.
The cross‑examination of the insurer's solicitor with respect to Smith v Gibson was, relevantly, as follows:
... Could you turn to ... the judgment, if you are familiar with these printouts?‑‑‑Yes. ...
And you come to the heading Assessment?---Yes.
Do you see the sentence from Judge Yeats:
There is no dispute about the desirability that the plaintiff live independently in the community. No one contends that the plaintiff .......... their lives as independently as they are able to do.
Now, I am not asking you to go to the facts of this particular case but is it not the general situation in damages claims of this kind for Mr Witcombe that you proceed from the policy position that it is better for disabled people to remain in the community and live their lives as independently as they can which includes living at home with appropriate care?‑‑‑I think there needs to be a balance between what is reasonable for the plaintiff in this case and the defendant. It happens that the defendant has an insurer behind him or her but it is a matter of balance in my experience of these things and each case needs to be considered on its merits.
There is nothing in the 'principles and considerations' expressed in Smith v Gibson or in the nature of the medical evidence exchanged prior to 24 March 2002 which indicates that the judge erred in his finding that he was not satisfied that Mr Witcombe's claim would have been settled as alleged by the executrix.
The fifth matter relied on by the executrix was Mrs Witcombe's evident concern to expedite the resolution of Mr Witcombe's claim and her assiduous responses to any request for instructions or information to assist in the resolution of the matter. That submission does not demonstrate any relevant error by the judge. The desire for an early resolution of a claim is not inconsistent with an intention that it only be settled on terms which Mrs Witcombe regarded as reasonable and fair. The judge referred to Mrs Witcombe's evidence that she 'was always prepared to negotiate settlement of [Mr Witcombe's] claim on the advice from [D'Angelo] for a reasonable sum without having the matter proceed to trial', and was always prepared to do so when the file was with the respondent solicitors (reasons [355]). His Honour considered [356] that Mrs Witcombe's evidence was of little assistance because it was in general terms, it did not identify the respects in which or the extent to which she would have been prepared to compromise her claim and, although no doubt genuine, the evidence was hypothetical and given with the benefit of hindsight. No error is demonstrated in the judge's reasoning in that regard. Nevertheless, the evidence does at least indicate that Mrs Witcombe would have required a reasonable settlement. The wish to secure a speedy resolution would not have been sacrificed at the expense of what Mrs Witcombe regarded as a reasonable resolution of the claim.
The sixth point is related to the fifth. It is alleged that Mrs Witcombe sought and acted on advice from her solicitors in relation to Mr Witcombe's claim and also in relation to the compromise of the claim under the Fatal Accidents Act1959. That being so, it is said, she would have compromised Mr Witcombe's claim on advice and acted reasonably in her assessment of the matters likely to be in issue when seeking a compromise. As the judge noted, however, there was no evidence from her giving any particularity as to the respects in which, and extent to which, she would have compromised. She did not give evidence, for example, that had she seen Dr Beel's report of 18 March 2002 earlier, she would have accepted in principle that Mr Witcombe had a reduced life expectancy and that she would have agreed, for negotiating purposes, a reduction of life expectancy to a particular level or within a particular range.
Also, in relation to the contention that she would have acted on advice, no evidence was given by D'Angelo (or other solicitors) as to what D'Angelo (or other solicitors acting reasonably) would have recommended to Mrs Witcombe as a figure for quantum, or a range for quantum, for the purposes of settlement negotiations with the insurer. Further, there is no direct challenge in this appeal to the judge's finding that he could not quantify, even in a broad way, a settlement figure which would have been acceptable to each of Mr Witcombe and the insurer. Whilst the appeal in a general way contends error by the judge in failing to be satisfied that a settlement would have occurred, the executrix does not point to any evidence showing that a particular settlement sum, or a sum within a particular range, would have been achieved.
The seventh point made by the executrix is that she was at all times aware of comparable personal injury settlements by co‑residents with Mr Witcombe at the Brightwater accommodation in Balcatta, and that she knew of the need for court approval of a compromise and the appointment of a court‑appointed trustee to hold any settlement sum on trust for Mr Witcombe. Mrs Witcombe's knowledge of these matters does not, however, point to any error by the judge as alleged by the executrix.
For these reasons, the executrix has not established that the judge erred in not being satisfied that the motor vehicle action would have settled before 24 March 2002 as alleged.
On the question of whether and when the matter would have gone to trial and achieved curial determination before Mr Witcombe died, the executrix led no evidence. The appellant alleged that the judge should have held, on the basis of his 'experience', that the matter would have been determined in the District Court by 24 March 2002. The submission was not put in terms of the judge having erred in failing to take judicial notice of a fact or facts relevant to that ultimate conclusion. The 'experience' which the judge was asked to draw upon implicitly related to matters such as the state and management of the court list, and typical judgment writing time, approximately 9 to 10 years earlier, in a court of which his Honour had not been a member. These matters were clearly capable of being the subject of evidence, as were other relevant matters such as the likely length of the trial, the scope of the contested issues, and the availability of counsel and expert witnesses
Absent any specification of the particular facts bearing upon the conclusion that the case would have been tried and judgment delivered prior to 24 March 2002, and absent a contention that the judge ought to have taken judicial notice of such facts, the executrix has not established error in the judge's finding that without calling evidence, the executrix had not discharged the onus of proof on her. The executrix's contention that a 'broad brush' must be taken to the determination of matters such as when, in the absence of negligence, the action could have got to trial (Johnson v Perez 366 ‑ 367) is correct, but there must be some evidentiary foundation for the conclusion reached in that regard.
Disposition - the first issue
The conclusion reached above is sufficient to dispose of the appeal. For completeness, however, I should also indicate that the executrix has not established error with respect to the first issue. For the purposes of the following discussion, I will assume that the executrix had proved that a settlement or verdict would have been obtained before 24 March 2002 (the date of Mr Witcombe's death), but for the respondent solicitors' negligence. That proposition, namely, that a settlement or verdict would have been obtained by 24 March 2002, grounds in substance the basis upon which, in relation to the first issue, it is said that the judge erred.
Tort
Mr Witcombe's cause of action in tort against the respondent solicitors said to survive for the benefit of his estate pursuant to s 4(1) of the Act would not be complete without proof of damage, in addition to proof of duty and breach: Commonwealth v Cornwell [2007] HCA 16; (2007) 229 CLR 519 [5]. It is a claim for economic loss. Economic loss may occur in various ways, such as by the payment of money, the transfer of property, the diminution in the value of an asset or the incurring of a liability: Wardley Australia Ltd v State of Western Australia [1992] HCA 55; (1992) 175 CLR 514, 536 (Brennan J). It may include the loss of a commercial opportunity of some, not negligible, value: Sellars v Adelaide Petroleum NL [1994] HCA 4; (1994) 179 CLR 332, 355, and also the loss of an intended beneficiary's right to have a deceased's estate administered in accordance with the testator's intentions with respect to that beneficiary: Hill v Van Erp [1997] HCA 9; (1997) 188 CLR 159, 168, 179, 197, 219.
In Commonwealth v Cornwell, the majority said [16]:
In Hawkins v Clayton, Gaudron J emphasised the importance for actions for negligence causing economic loss in identifying the interest said to be infringed, whether it be the value of property, the physical integrity of property, or the recoupment of moneys advanced. Thereafter, in Wardley Australia Ltd v Western Australia, Mason CJ, Dawson, Gaudron and McHugh JJ observed:
'To compel a plaintiff to institute proceedings before the existence of his or her loss is ascertained or ascertainable would be unjust. Moreover, it would increase the possibility that the courts would be forced to estimate damages on the basis of likelihood or probability instead of assessing damages by reference to established events. In such a situation, there would be an ever-present risk of undercompensation or overcompensation, the risk of the former being the greater.'
Their Honours also said:
'The kind of economic loss which is sustained and the time when it is first sustained depend upon the nature of the interest infringed and, perhaps, the nature of the interference to which it is subjected. With economic loss, as with other forms of damage, there has to be some actual damage. Prospective loss is not enough.'
I have mentioned earlier that the executrix does not claim damages for the loss of a chance.
In this matter, in substance, the nature of the interest said to be infringed concerned the value of Mr Witcombe's cause of action against the driver. The relevant nature of the interference was the negligent conduct of the respondent solicitors in causing a delay in the prosecution of the action against the driver by 15 to 18 months.
Having regard to the way in which the executrix puts her case, the value of Mr Witcombe's cause of action against the driver was not impaired or diminished during his lifetime.
Throughout his lifetime, despite the negligent delay of the respondent solicitors, Mr Witcombe retained his cause of action against the driver. Proof of the fact that the cause of action should and would have been converted into damages at some earlier point prior to 24 March 2002 is not, of itself, proof that the value of the cause of action had been diminished or impaired. The proof of that fact does not of itself establish the existence of any ascertainable damage prior to Mr Witcombe's death, and hence does not establish the existence of loss or damage for the purpose of showing a completed cause of action in tort in Mr Witcombe's lifetime.
It has not been contended by the executrix in this appeal that there was an ascertainable loss in Mr Witcombe's lifetime because the value of his cause of action was diminished or impaired at some specified point prior to his death. For example, it is not said that Mr Witcombe suffered loss because the value of his cause of action against the driver had become impaired at some point in time by a combination of the potential operation of s 4(2) of the Act and the delay caused by the solicitors' conduct where the delay then meant that, in practical terms, there was then no prospect of Mr Witcombe reaching a settlement with, or obtaining a verdict against, the driver before he died. If the claim had been put that way, so that the claimed loss was one suffered in Mr Witcombe's lifetime, and a cause of action in tort against his solicitors survived for the benefit of the estate, the loss would be the extent of the alleged diminishment or impairment in the value of the cause of action. That was not the case put.
The cases of Johnson v Perez and Nikolaou v Papasavas do not assist the executrix. In those cases, by the operation of the statute of limitations, the original cause of action had effectively been lost and had ceased to have any value. At that point in time, the loss suffered as a result of the negligent conduct of the solicitors, whose duty it was to obtain a settlement or verdict for the client, had 'crystallised': Nikolaou v Papasavas (403), Johnson v Perez (366 ‑ 367).
Here, Mr Witcombe, in his lifetime (and indeed after his death) never lost his cause of action against the driver. Also, as noted above, the executrix does not point to a loss by reason of the value of the cause of action being adversely affected in his lifetime. Accordingly, in substance, an essential ingredient in the cause of action in tort did not arise in Mr Witcombe's lifetime and no cause of action of the kind alleged vested in Mr Witcombe prior to his death.
For these reasons, the executrix has not established error by the trial judge in relation to the claim in tort against the solicitors.
Contract
However, unlike the claim in tort, Mr Witcombe had a completed cause of action in contract upon breach of the retainer.
Nominal damages may be awarded in all cases of breach of contract and the judge awarded them here. In Baume v Commonwealth [1906] HCA 92; (1906) 4 CLR 97, 116 ‑ 117, Griffith CJ referred to Lord Halsbury's statement in The Mediana [1900] AC 113, 116, where his Lordship said:
'Nominal damages' is a technical phrase which means that you have negatived anything like real damage, but that you are affirming by your nominal damages that there is an infraction of a legal right which, though it gives you no right to any real damages at all, yet gives you a right to the verdict or judgment because your legal right has been infringed. But the term 'nominal damages' does not mean small damages.
Where a plaintiff seeks more than nominal damages, the onus is on the plaintiff to prove the nature and extent of the damages suffered as a result of the defendant's breach: Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd [1998] HCA 38; (1998) 192 CLR 603, 608, 612, 627, 628, 640; Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54; (1991) 174 CLR 64, 80. This involves two steps; first, that the loss suffered resulted from the breach and, secondly, that the loss was not too remote: Reg Glass Pty Ltd v Rivers Locking Systems Pty Ltd [1968] HCA 64; (1968) 120 CLR 516, 523.
Remoteness in relation to the law of contract requires that on the information available to the defendant when the contract was made, the defendant, or a reasonable person in his or her position, should have realised that the loss was sufficiently likely to result from the breach of contract so as to make it proper to hold that the loss flowed naturally from the breach, or that loss of that kind should have been within his or her contemplation: Wenham v Ella [1972] HCA 43; (1972) 127 CLR 454, 471 ‑ 472; Burns v MAN Automotive[1986] HCA 81; (1986) 161 CLR 653, 657 ‑ 658, 672 ‑ 673; Commonwealth v Amann Aviation (99); Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd (613). In Unity v Rocco, Gummow J [68] (albeit dissenting in the result, but not with respect to this statement of principle) said, with reference to remoteness, 'Here, as in other fields of law, hindsight may mislead'.
It may be noted that in National Australia Bank Ltd v Nemur Varity Pty Ltd [2002] VSCA 18; (2002) 4 VR 252, Batt JA considered remoteness in the context of a standing contract, establishing a continuing bank/customer relationship over a period of time. The contract was entered into in 1986. The breaches occurred in 1989. His Honour (at [49]) in considering remoteness took into account knowledge that the defendant acquired in the course of executing the contract, by treating the continuing or standing contract made in October 1986 as engaged and given content by instructions from time to time from the customer to the bank. Remoteness was not judged simply by reference to the position of the parties at the time the standing contract was entered into. Although the retainer in this case was in the nature of a standing contract, Batt JA's observations were not debated in this appeal.
In general, damages are assessed as at the date of breach, although that general rule may be departed from if necessary in order to give fair compensation for the wrong suffered: Johnson v Perez (355 ‑ 356, 367). In assessing damages against solicitors for breach of contract in failing to exercise reasonable care in the prosecution of a cause of action on behalf of a client, damages are, at least generally, appropriately assessed at the time when the loss to the client crystallises: Johnson v Perez (366 ‑ 367); Nikolaou v Papasavas (403 ‑ 404).
For the reasons given earlier, it was not established that Mr Witcombe suffered loss or damage in his lifetime by reason of a breach by the respondent solicitors of the terms of their retainer to exercise reasonable care.
In the court below, the judge held that, on the proper construction of the Act, a cause of action for substantial damages only survives under s 4 of the Act in respect of loss or damage suffered by the deceased in his lifetime (reasons [285]). His honour noted that the executrix had not contended otherwise. If the judge's construction of s 4, which was not in dispute below, were correct, no error was made by the judge in relation to the claim in contract.
There was no express ground of appeal to the effect that the judge misconstrued s 4 of the Act. Nor was it said by the executrix that the judge erred in recording that at the trial, the executrix did not contend for a different construction. Despite this, the executrix, in her written submissions, nevertheless asserted that the judge erred in his construction of s 4 of the Act and, in that regard, referred to Otter v Church, Adams, Tatham & Co [1953] 1 Ch 280.
The respondent solicitors did not contend in written or oral submissions in this appeal that the executrix was precluded, by virtue of the stance taken by the executrix at trial, from arguing that the judge had misconstrued s 4. They contended in oral argument that the loss was, nevertheless, too remote. Whilst there was no notice of contention to that effect, its absence may be explicable by reference to the impermissible way the executrix introduced the underlying point of statutory construction.
The ways these issues have emerged is unsatisfactory. Nevertheless, as the litigation between the executrix and the respondent solicitors has been going for over six years, and many of the events under consideration stretch back to over a decade ago, it is appropriate to deal with the appeal on the basis that the grounds of appeal raised a question as to the proper construction of s 4, and that the respondent has raised the issue of remoteness, despite the absence of a notice of contention.
In Otter v Church, the plaintiff, as guardian for her son, then aged 18, engaged the defendants as solicitors to advise her on the extent and nature of his interest in certain settled property which had fallen into his possession under a Will. The solicitors advised her that he would become entitled absolutely to the property upon attaining the age of 21. That was wrong. The true nature of the interest was that of an equitable tail male with remainder over in favour of his uncle. In late 1944, the plaintiff again sought advice on behalf of her son, who had then turned 21. She told the solicitors that her son was serving in the Royal Air Force in India and asked what should be done about transferring the property to him. She was told that the transfer of the settled property could wait until his return from war service, and this was the best course to adopt. The plaintiff informed her son of this advice. The son was shortly thereafter killed in a flying accident and died intestate. The property passed to the son's uncle.
The plaintiff, as executrix of the son's estate, sued the solicitors for breach of the term of the retainer to exercise reasonable care. Had the son executed a disentailing assurance, or devised it by Will, the property would not have been lost to him. The plaintiff alleged that in consequence of the solicitors' advice, the son refrained from executing a disentailing assurance or making a Will, as a result of which the property was lost to the son.
Upjohn J held that the solicitors had breached the contract by advising on the basis of a misunderstanding the nature of the son's entitlement to the property. The judge held that by reason of the negligent advice, the son was allowed to assume that the property belonged to him absolutely, when he should have been told that to make it his own, he either had to make a Will or execute a disentailing assurance. His Lordship held that there was a breach of contract. He then noted counsel for the solicitor's submission:
Mr Bell [for the solicitors] submitted forcibly that the plaintiff was, in effect, attempting to recover damages which resulted not from the solicitor's breach of duty, but by virtue of the death of the deceased.
The judge identified the key issue in the case as one concerning damages. His Lordship said (288 ‑ 290):
What, then, is the proper measure of damages in the present case? I was referred by Mr Bell to the well‑known rule in Hadley v Baxendale as expounded in the more recent decision of Victoria Laundry (Windsor) Ld v Newman Industries Ld, Coulson & Co Ld (Third Parties), which established that damages for breach of contract should be such as would naturally be expected to flow from the breach, or such as may reasonably be supposed to have been in the contemplation of the parties, at the time they made the contract, as the probable result of the breach of it. It seems to me impossible in this case to apply that latter test having regard to the nature of the breach of contract. Therefore, I have to consider what are the damages which may naturally be expected to flow from the breach.
It is perfectly true that if Michael [the son] had continued to live damages would have been nominal. Are they, however, to be limited to the damages which he could have recovered in his own lifetime, as Mr Bell submitted? Not in my judgment. It is contrary to common sense to suppose that damages in a case such as this must only be nominal merely because, had the mistake been discovered in the lifetime of the deceased, it could have been rectified. The true method of approaching the problem, in my judgment, is this: if the mistake was discovered in Michael's lifetime it was his duty, of course, to mitigate damages, and, indeed, reduce them to a nominal sum by executing a disentailing deed if he so desired; but it may well be that the mistake is not discovered until after his death. If the mistake is not discovered till after his death, Michael has been deprived of the opportunity of increasing his estate by executing a disentailing assurance relating to the settled property, and, therefore, upon his death, his estate may be diminished by that amount.
...
In my judgment ... I am not bound to hold that damages in this case are only nominal merely because the deceased could only have recovered nominal damages in his lifetime.
...
What, then, is the true measure of damages? The relevant facts upon that question seem to be these: it was certainly more than a remote possibility that Michael would be killed while on active service, and, therefore, damages might naturally be expected to flow from the failure to give proper advice. Mr Bell submitted that, even upon the footing that he was wrong upon his first point, viz, that the personal representative could not claim greater damages than the deceased could have claimed in his own lifetime, even so damages are nominal. I reject that argument. In the circumstances of this case, there was a serious possibility that the failure to give him correct advice would lead to his estate losing the whole of the settled property.
Upjohn J held that the son would probably have executed a disentailing deed had he been so advised, but in awarding damages against the solicitors the judge made a discount for the possibility that the son may not have done so.
Certain aspects of the decision in Otter v Church have been the subject of some criticism. This has been directed to Upjohn J's decision to discount the damages awarded to reflect the possibility that the son may not have executed a disentailing deed, despite having found on the facts that he probably would have done so if properly advised. See Allied Maples Group Ltd v Simmons & Simmons (a firm) [1995] 1 WLR 1602 (Stuart‑Smith LJ (1612) and Millett LJ (1623 ‑ 1624)); Sykes v Midland Bank Executor and Trustee Co Ltd [1971] 1 QB 113 (Salmon LJ, 129 ‑ 130). More recently, in England, Upjohn J's decision has been approved of, in the context of 'survival' claims by an executor, by the English Court of Appeal in Corbett v Bond Pearce (a firm) [2001] 3 All ER 769; [2001] Lloyd's Rep PN 501; [2001] PNLR 31 [16] ‑ [17]; Rind v Theodore Goddard (a firm) [2008] EWHC 459 (Ch) [40]; and also by Norris J in Vinton v Fladgate Fielder (a firm) [2010] PNLR 26 [12] ‑ [13]. Otter v Church has, in other contexts, also been referred to with approval by Deane J in Commonwealth v Amann Aviation (124) and also by Dawson J (Toohey J concurring) in Hill v Van Erp, 180.
The decision in Otter v Church and the English authorities approving it to which I have referred, suggest that s 4(1) properly construed, does not limit the recovery of substantial damages for causes of action in contract where the damage occurs in the lifetime of the deceased.
Under the general law, prior to the introduction of 'survival' legislation, a personal representative of a deceased does not appear to have been confined, other than by the rules of causation and remoteness, in recovering damages for a breach of contract where the breach occurred within the lifetime of the deceased and damage resulted to the property of the deceased. It is unlikely that remedial legislation was intended to bring about a narrowing of the position under the general law. Moreover, whatever the general law position was, there is nothing in the language of s 4(1) suggesting such a limitation.
Accordingly, I accept the executrix's submission that the judge erred in his construction of s 4 of the Act, insofar as his Honour held that an executor is necessarily precluded by s 4(1) from recovering substantial damages for breach of contract in the deceased's lifetime where the substantive loss from the breach only crystallises at the point of death.
That conclusion does not, however, assist the executrix. The property in Otter v Church was real property and its value was fixed, or capable of being fixed, by market or other valuation methods. Its value had an objective existence which was not derived from an assessment of the life expectancy of the deceased.
The major component of value in the cause of action against the driver depended upon Mr Witcombe's life expectancy. The assessment of his life expectancy was necessary in order to enable a measurement of his needs that had been created by the motor vehicle accident. It was Mr Witcombe's loss, represented by his needs, for which he was to be compensated by the driver of the vehicle: Griffiths v Kirkemeyer [1977] HCA 45; (1977) 139 CLR 161; Kars v Kars [1996] HCA 37; (1996) 187 CLR 354. It was compensation for that loss which was, relevantly, the object of the pursuit of the cause of action by the respondent solicitors, on his behalf.
Mr Witcombe's death on 24 March 2002 demonstrated that his needs attributable to the accident were not properly assessable on the basis that he needed care over the next 20 to 22 years as alleged in either the pleaded schedules of damage or the document handed up to the trial judge. The pleaded or alleged value of the cause of action against the driver could not, accordingly, be taken, in a claim against the respondent solicitors, to be the true value of the cause of action against the driver.
The loss claimed by the executrix is a loss which is based on an assessment of Mr Witcombe's life expectancy of 20 to 22 years, which is inconsistent with the facts known at the time of death, which is when the loss crystallised and the assessment ought be made. See Nikolaou v Papasavas 403 ‑ 404.
By propounding the loss as the lost receipt of an earlier verdict or settlement of the motor vehicle action, the executrix is seeking, in substance, to recover by way of damages, from the solicitors, more than the cause of action against the driver was worth. The purpose of the retainer was to preserve and extract the value inherent in the cause of action against the driver. The claimed loss represents an economic disadvantage which is beyond the fundamental object served by the retainer. Insofar as that constitutes a loss to Mr Witcombe, the loss is not of a kind which the respondent solicitors, or a reasonable person in their position, should have realised was sufficiently likely to flow from the breach of contract so as to make it proper to hold that the loss flowed naturally from the breach, or that loss of that kind should have been within their contemplation. That is so whether remoteness is considered either on the basis of the information available to the respondent solicitors when the retainer was entered into, or on the basis of any knowledge that they had, or should have had during the execution of their instructions, had they performed the retainer without negligence (cf National Australia Bank v Nemur).
Moreover, the loss claimed depends upon the proper performance of the retainer so that, in the events which happened, a verdict or settlement would have been achieved prior to Mr Witcombe's death. The judge found that even after the receipt of Dr Beel's report - which was to the effect that Mr Witcombe had a real but unquantifiable risk of premature death - Mr Witcombe's death was sudden and unexpected. Even if it were assumed that the respondent solicitors should have had Dr Beel's report much earlier, and should thereby have known of the real but unquantifiable risk of premature death, the finding that Mr Witcombe's death was sudden and unexpected is significant.
The claimed loss fundamentally directs attention to the importance of Mr Witcombe monetising his cause of action against the driver before his death. The executrix did not contend that there was a term of the retainer by which the respondent solicitors agreed to procure that result. In circumstances where the death was sudden and unexpected, the claimed loss, by its nature, would not flow naturally from the breach. Nor is it of a kind which the respondent solicitors, or a reasonable person in their position, should have realised was sufficiently likely to flow from the breach so as to make it proper to hold them liable for the claimed loss.
For these reasons, the claimed loss in both its substantive aspects, ie, reflecting pecuniary loss for future care, and general damages, is too remote.
Conclusion
I would dismiss the appeal.
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