Government Insurance Office of New South Wales v Guidera

[1990] HCATrans 304

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IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S84 of 1990

B e t w e e n -

GOVERNMENT INSURANCE OFFICE OF

NEW SOUTH WALES

Applicant

and

ANDREW JOSEPH GUIDERA

Respondent

Application for special leave

to appeal

BRENNAN J
DAWSON J

GAUDRON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 7 DECEMBER 1990, AT 10.15 AM

Copyright in the High Court of Australia

Guidera 1 7/12/90

MR R.J. ELLICOTT, QC:  In this matter, Your Honour, I appear

for the appellant with MR P.W. NEIL. (instructed

by G.M. Meadows)

MR R.S. McILWAINE: If the Court pleases, I appear for the

respondent. (instructed by Dunhill Madden Butler)

MR ELLICOTT:  Your Honours, there are two issues here which

relate to motor vehicle law and they are two issues

which are of great importance. Your Honours will

be familiar with the facts, that is to say, that

the unfortunate plaintiff was lying asleep in the

back of a van on a journey from Coober Pedy to

Alice Springs. The driver of the vehicle lent over

to pick a pen-knife or something out of a bag and

the vehicle got out of control.	It rolled and went
into a tree.	The two people in front had
seat-belts on and they had minor injuries.	The

unfortunate plaintiff in the back was thrown around

and the result of his injuries were that he became

a quadriplegic.

The evidence is that there was a third

seat-belt in the front seat of the vehicle which

was available. The evidence also is that the

plaintiff was aware of that. Obviously it was not

used and the evidence also is that had the

plaintiff been confined by that seat-belt the

serious injuries that had occurred would not have
occurred so that those facts are well

established.The other issue relates to future

economic loss and perhaps I will deal with that

later when I come to it.

Now, Your Honours, one of the issues that

arose was whether it was a breach of the Northern

Territory regulations not to wear a seat-belt.

Now, that does not become an essential issue before

this Court. The Court of Appeal said that because

the legislation required a person to be occupying a

seat, then the failure to wear the seat-belt was

not a breach of the regulations. Well, that is a

very moot point as to whether he was occupying a

seat or not. He was lying in the back. If he was

sitting up I guess he would be occupying a seat in

the sense he was sitting on the floor. This is a

very, perhaps, nice area of debate.

I do not propose to ask Your Honours to

entertain that, but a very serious finding of the

Court of Appeal was that there was no evidence of

any community standard requiring the use of

seat-belts and it is abundantly clear that the

Northern Territory, like the States in Australia,

make it compulsory to wear seat-belts. There may

be some fine points about the interpretation, but

there is a community standard about it.

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Now, since this accident we, of course, had

the motor accident legislation in New South Wales

after the first batch of Trans-cover and now the

failure to wear a seat-belt is, in effect, prima

facie, a contributory negligence and therefore it

becomes a question in the courts now simply of

making a decision as to the quantum to be taken

into account but that is left to the discretion of

the judge. So far as this particular - - -

BRENNAN J: That is in New South Wales?

MR ELLICOTT: That is in New South Wales, yes, Your Honour.

Now, clearly enough there is a duty on any

plaintiff to take reasonable care for his own

safety. That has been laid down for a long time

and plaintiffs have always been required to observe

that. There is no doubt that the courts have held

on numerous occasions, both in reported and

unreported cases, that failure to wear a seat-belt

can amount to contributory negligence. There is no

doubt that in this case, as I have already put, if

the plaintiff had been wearing it the serious

injuries would not have occurred.

The other matter that is of significance, we

would submit, on considering whether leave to

appeal should be granted in this case, is that the

High Court to date on this, what we would say is a

very important matter, has not considered whether

or not the failure to wear a seat-belt is something

which ought, in certain circumstances, to amount to

contributory negligence. There has been a - - -

GAUDRON J: That question may arise in a variety of

circumstances, may it not?

MR ELLICOTT: Yes.

GAUDRON J:	One, where you are in an ordinary sedan car with four seats, four seat-belts as it were and in that
context that may well be a matter of some
importance but does it have the same importance,
Mr Ellicott, in circumstances where it is open to
the inference that you might.in fact be improving the condition of other passengers by going into the
back of a van, for example, as in this case and,
perhaps, the safety of - - -

MR ELLICOTT: Well, you may be improving the condition but

we would say not looking after your own safety.

GAUDRON J:  Maybe improving the safety of the whole

complement.

MR ELLICOTT:  The Court of Appeal have this notion of these

three large people sitting in the front of a

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vehicle and all crouched up, uncomfortable and hot

and sweaty and all the rest of it. Now,

Your Honours, that does not add up to anything

other than three people choosing to travel in the

outback of Australia, something that I guess a number of people in this Court are used to and

those conditions are not un-Australian conditions;

they are quite common. Once you venture outside

the city and into the remote areas of Australia

whether you are a farm worker, whether you are a

grazier, whatever you are, well, you are just a

tourist.

Those conditions are quite normal. They are

facts of life and it can happen whether you come

from Moree or Bourke or Coober Pedy or wherever you

are; it is a fact of life and, therefore, one

should not judge, we say, by subjective standards.

One should look at it by an objective test; that is

to say, what would a reasonable person do in the
position of the plaintiff having concern for his or

her own safety. That is to say, would a reasonable

person in the plaintiff's situation have said,

"Now, I am travelling from Coober Pedy. They are

going to travel, no doubt, close to the speed

limit. I am going to be lying in the back of the

truck. We might hit a kangaroo. Something else

might happen - a vehicle might swerve, Bill might

go to sleep", anything can happen, as we know, on

those journeys. They are not things that are

remote from the reasonable - - -

GAUDRON J: But is that not really a jury question in this

sense?

MR ELLICOTT: It is a jury question, but here - that is what

we would have hoped it was but the Court of Appeal

has intruded into the jury question. The judge decided that it was contributory negligence and

that is what we are complaining about.

DAWSON J: It is a matter of inference.

MR ELLICOTT: It is a matter of inference but, at the same

time, we say that it is an important matter of

inference and it should not left on the law books

that in a case such as this contributory negligence

should not be found by a trial judge because the

trial judge has found it. The Court of Appeal for

subjective reasons really, which conjure up this

group of three travelling around in uncomfortable

conditions should not, in the circumstances, be

seen as guilty of contributory negligence because

he did not sit in the front seat.

DAWSON J:  Does that mean that in the outback you should never accept a ride in the back of a truck?

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MR ELLICOTT: Well, no, Your Honour, it just means - - -

DAWSON J: Well, it does, does it not?

MR ELLICOTT:  - - - that if you do you are there are your

own risk. That is it, and if you get on the back

of a motor bike you are there at your own risk.

DAWSON J: But you are not negligent in the circumstances.

MR ELLICOTT: Well, you can be guilty of contributory

negligence if you do not have care to your own

safety. Your Honour, if you hop on the pillion

seat of a bike, for instance, and you not used to

doing it - or even if you are - you are at risk.

If, in the circumstances, you can say you have not taken ordinary - - -

DAWSON J: Every time I get on a bus I am potentially guilty

of contributory negligence.

MR ELLICOTT:  Now, Your Honour, with great respect, that is

an argument that the Court of Appeal used: because

there are no seat-belts in buses. Well, we

understand there soon may be seat-belts in buses.

I do not know whether they can afford them in

Victoria, Your Honour, but apparently we are going

to put them in in New South Wales.	In other
words - - -

DAWSON J:  They do not own the buses in Victoria.

MR ELLICOTT: - - - the community standards,

Your Honour - - -

GAUDRON J: Perhaps more importantly, for Justice Dawson's

purposes, he would be at risk in travelling in

vintage cars.

MR ELLICOTT: Yes, he would and it may be that in the light

of the community standards, that people travelling in vehicles should be confined by seat-belts might

cause a jury or a court to say that in given

circumstances a person in a vintage car should make

sure that the seat-belts are in there because they

are available.

GAUDRON J:	No, they are not.
MR ELLICOTT:	No, but because they are available to be

purchased and to be fitted. Now, Your Honours,

what is important here is that people generally

have to pay for it. We tend to look at this from

the plaintiff's point of view, but the public

interest - and this is what we are concerned

about - I mean, the issue is one of debate and I

can debate it with Your Honours but, at the end of

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the day, it is a question of whether this is an

issue which is important and which should come to

this Court.

Now, there are some 45,000 claims outstanding,

according to an affidavit that is before

Your Honours. Do Your Honours have that affidavit?

BRENNAN J:	I am not sure that we do.
MR ELLICOTT:	I should make sure that Your Honours do.

BRENNAN J: It is not in the appeal papers?

MR ELLICOTT:	No, Your Honours, it is one that just sets out the position in the office.
BRENNAN J:	Have you seen this document?
MR McILWAINE:	Yes, I have a copy, Your Honour.
MR ELLICOTT:	I will just pause a moment while Your Honours

read it.

BRENNAN J: Yes.

MR ELLICOTT:  Your Honours, there are some 45,000 claims

outstanding and the evidence in that affidavit is

that 15 to 20 per cent of them involve an issue

with respect to seat-belts so it is a recurring

issue. The fact that it is regarded by statute now

as amounting to contributory negligence, we would

submit it is important that this Court should

consider whether the common law goes far enough as

to require, in these circumstances - and

Your Honours may say, "Well, this isn't the usual

case", but this case would throw it up. It would

cause the Court the consider just how far the

liability of a plaintiff to use a seat-belt goes.

Now, if Your Honours found that lying in the

back of a truck was all right, that is fine, but at

least the line is drawn but there is no line at the
moment.	If you are lying on the back seat and

there are seat-belts, "What is the difference?",

one might ask, or if for some reason you have had

too much to drink and you get in the back seat and

you are lying between the two seats, what is the

position? There are all sorts of things that must

crop up from time to time in all these cases and we

would submit that those are issues which make it

desirable to have this Court have a look at the

matter.

But, beyond that, but also important to it, is

the proposition that community standards are saying

people should wear seat-belts and then the

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community is also complaining about premiums for

insurance and every time these questions arise and decisions are made they affect the public at large

as to what they have to pay. Now, all those are

public issues - Your Honours are well aware of

them - but we would submit that in the circumstance

of this case, this is a proper case in which to

grant leave in respect of that matter.

Now, Your Honours, the other ground relates to

future economic loss. Would Your Honours mind if I

just take Your Honours quickly to some facts in

relation to the matter dealt with by the trial

judge at pages 36 to 40 and then from pages 40 to

41.       Now, one thing is clear that the plaintiff

apparently was a person who had not settled down in

any activity - any fixed employment. He did have

thoughts of getting a job with the Australian

Institute of Sport but his prospects there were not

what you might call promising. Quite apart from

that, however, he had had some relationship with

Elders and the idea of his employment with Elders

became a matter at the hearing. Now, the judge

determined past economic loss on the basis of $350
per week. At page 40, at the top, he says:

I propose to allow $350.00 per week net as being the probable earnings of the plaintiff

had he not been injured for the period during

which I consider -

and then he goes on to apply certain material to

it. At page 39, just going back - - -

BRENNAN J:  You do not raise any problem about that finding

or assessment.

MR ELLICOTT:  No, Your Honour, but the reason I am referring

to it is to go into the future but just to refer to

some findings of the judge. He says, at line 11:

For the past I consider it unlikely that the plaintiff would have exercised his earning

capacity in full because his immediate future

was indeed unsettled.

It is submitted on behalf of the

plaintiff that I should approach the

assessment ..... upon the basis that the

plaintiff would by November 1986 have taken up

employment as a merchandising clerk with

Elders, or some similar position, and using figures advanced through Mr Millard I am asked

to compensate the plaintiff on the basis of a

net weekly loss of $490.00 since

November 1986.

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I reject this submission. I cannot be

persuaded by the evidence that the plaintiff

would have found and pursued steady employment

as quickly as I am asked to accept.

Now, that $490 a week then became of

significance because, although he made that finding

that he could not be persuaded -

that the plaintiff would have found and

pursued steady employment -

quickly, he also found, that is, the trial judge

did not think that the plaintiff would have found

himself in a job that would be a branch manager job

which would have given him net $490 or $500 a week.
And, at page 40, just to get it clear, at line 23,

he says:

Having regard to his undoubted abilities I

find he would have pursued regular work, being

remunerated at levels no less than those

spoken of -

and then in the middle of page 41, he says:

There was evidence before me as to what a

Branch Manager with Elders at Alice Springs

earns. The plaintiff impressed as the sort of

person who could have expected advancement

once he settled in regular employment.

However this advancement would not of course

have been immediate.

I approach the assessment of an

appropriate allowance ..... conservatively -

and he says -

to acknowledge that progression to management

required opportunity which need not

automatically have opened for him.

So, having said that, however, he proceeded: In all the circumstances I consider it appropriate to quantify the plaintiff's lost capacity at $500.00 per week net.

Now, that, of course, is $750 per week and that is,

in effect, the branch manager's salary. But he

says, in the context, that he acknowledges:

progression to management required opportunity

which need not automatically -

we would say that means, in any event -

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have opened for him.

Now, what is our complaint here? What we are saying here, Your Honours - and the Court of Appeal

have upheld the learned trial judge - is that

although, in the case of future economic loss, the

question of what amount should be chosen is clearly

a matter for the discretion of the trial judge.

Nevertheless, the decision has to be based, that is

the exercise of the discretion has to be based on

some rational argument or basis. You cannot pluck

a figure out of the air, it is not a matter of
guesswork. It is a difficult assessment and it may

mean that you can never be quite sure whether you
have got it right.

But, if you are going to say that a particular plaintiff was a $500-a-week man, then you have to

have a rational basis upon which to say it. Now,

there was no reasoned approach to it.	Now, the
Court of Appeal - - -

BRENNAN J: Well, does that depend on what Mr Millard was

putting forward?

MR ELLICOTT: Well, in a sense, the evidence that was before

the trial judge said that, yes, a branch manager
would get, in effect, $500 per week net but, at the

same time, the judge held - in that sentence that I

have referred Your Honours to, at page 41 - in

effect, that he was not at all sure that the

plaintiff would reach that status of branch

manager. He did not find that that was his level

of competence that he was likely to rise to. Now,

it is in that context, we say, that although, yes,

Mr Millard's evidence is there, the judge himself

has not proceeded on a rational basis.

Now, Your Honours can appreciate, from the point of view of the insurer, the leap from $350 to

$500 a week is very significant and although one is

always sympathetic, as one obviously is with a quadriplegic, the fact is, again, one has to face	the harsh reality of life, that these amounts have
to be provided and they are provided for basically
out of premiums which everybody pays. And, the
judiciary, in making the assessment, we say, should
base it on a proper reasoned approach.

For instance, supposing one has a case of a

clerk and she is engaged in a solicitor's office

and she has been doing fairly well in the examines
and it is expected that she will get through in

four or five years - she is just in her first

year - and there is evidence to that effect. Well,

one can then make a rational assessment of her

future prospects and come to a reasoned decision

Guidera 9 7/12/90

about it and say, "Well, yes, we think within a

certain period of time she would have become a

solicitor, she would have earned so much a week and

on that basis we feel that her future economic

capacity should be assessed".	Now, that obviously
is a rational basis.

That is needed, we say, in every case: a

reasoned basis upon which you approach it. Now, we

say, with respect, that the Court of Appeal has

failed to require that and has, indeed - although

it is acknowledged the deficiency of the evidence,
it is said that in some broad way the judge was

entitled to do this. The part of the case where

there is difficulty in their judgment, we say,

appears at pages 72 and 73. First of all, at

line 19 on page 72:

There was, in our opinion, no evidence before

the Court upon which to make a finding that,

either in his preferred area of employment or

any other area in which he might have secured employment, the plaintiff could have expected

that he would be earning $750 per week gross

at the time of trial.

And, at line 10:

Given that the evidence demonstrated that the

plaintiff could only have earned a salary of

that dimension after working at Elders

continuously for ten years there is

considerable force in the submission.

So, that is an acknowledgement that even if he did

become a branch manager, which Mr Justice Studdert

said he was not satisfied that he would, the Court

of Appeal say, "Well, in any event it would not

have happened for ten years." Then, over the page,

they say, going from line 4:

During this time the plaintiff, a man of

proven capacity, would almost certainly have

progressed in his ultimately chosen employment

and received a higher income ..... as he grew

older. The case is to be distinguished in

this respect from a person whose employment

history suggested that his income level would

be, relatively, static during the remainder of

his life. If, therefore, his Honour had

adopted the figure which he believed the

plaintiff would, if uninjured, have been

earning at the date of trail then he would
have failed to take account of the plaintiff's
probable advancement ..... For instance if the

trial judge had accepted the argument of

Senior Counsel for the defendant, which was

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repeated before us, that a net figure of $350

per week should have been adopted he would, in

our opinion, have fallen into the error of

making no allowance for the plaintiff's

probable progression in his ultimately chosen
area of employment. In the light of those

considerations we reject the submission that a

salary of $500 net per week was inappropriate

for use in assessing the compensation for the

impairment of the plaintiff's work capacity.

In our view it was necessary to adopt a higher

figure than the wage which the plaintiff would

probably have been earning at the date ..... In

these circumstances, and as there was a

significant speculative or conjectural element

involved ..... we are not persuaded that his

Honour ..... was in error.

Now, Your Honours, the gravamen of our

submission is that there ought to have been an

analysis of the basis upon which future economic

loss should be ascertained in circumstances like

this. There is no discussion of principle in the

Court of Appeal. There is a reference to Paul v

Rendell, at page 71, where it says:

"future economic loss involves a double
exercise in the art of prophesying not only
what the future holds ..... but also what the
future would have held ..... the choice of

figures for the variables is within the

discretion of the assessing judge. By

adjusting one or other of these factors he can

make the formula work out at whatever figure

he feels intuitively to be correct."

That is all right but it does not say you can guess or leave it up in the air and we say that

matter is of such great importance to all the

cases, and although we have a new system in New

South Wales, for instance, future economic loss is

still relevant to that. The way in which it should

be calculated is a matter of public importance.

Cases like Todorovic v Waller deal with the

5 per cent and the 3 per cent rule but, so far as

our researches go, Your Honours, there is no

ultimate decision of this Court dealing with the
issue of the mode of calculation of future economic
loss and the assessment of the probable earning

capacity of a plaintiff.

So, we say there is no doubt that the question

is one of great public importance; one that is of

daily concern to the administration of justice;

and one which we would say, in the circumstances,

is one, with respect, to which Your Honours should

grant special leave. If the Court pleases.

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BRENNAN J:  We need not trouble you, Mr Mcilwaine.

MR MCILWAINE: If the Court pleases.

BRENNAN J: This is a case where the question whether a

plaintiff who fails to wear a seat-belt and thereby

suffers an injury in a motor vehicle accident

caused by the driver's negligence is, on account of
his failure to wear the seat-belt, guilty of
contributory negligence. The question is, and is
put as being, a question of fact. In determining
that question, all the circumstances of the case
must be taken into account. Here, having regard to

the nature of the vehicle, the journey being

undertaken and the location and road conditions in

question, the Court of Appeal has found that there
was no contributory negligence. It is not

appropriate to grant special leave to consider

whether a different view should have been formed.

The assessment of future economic loss was

attacked but no error of principle appears in the

making or confirmation of the assessment.

Accordingly, special leave will be refused.

MR McILWAINE:  I apply for costs, Your Honour.

BRENNAN J: It will be refused with costs.

AT 10.46 AM THE MATTER WAS ADJOURNED SINE DIE

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