GLEESON CJ, GAUDRON, McHUGH, GUMMOW, KIRBY, HAYNE AND CALLINAN JJ
ANDREW GRINCELIS by his next friend TADAS GRINCELIS APPELLANT
AND
STEPHEN HOUSE RESPONDENT
Grincelis v House [2000] HCA 42 3 August 2000 C20/1999
ORDER
Appeal allowed with costs.
Vary paragraph 1 of the order of the Full Court of the Federal Court of Australia made on 1 July 1998 by deleting the sum of $4,524,910 and substituting the sum of $4,680,370.
Application for special leave to cross-appeal dismissed with costs.
On appeal from the Federal Court of Australia
Representation:
L M Morris QC with C E Adamson for the appellant (instructed by Abbott Tout Harper & Blain)
M J Neil QC with R C Tonner for the respondent (instructed by J M Crestani)
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
CATCHWORDS
Grincelis v House
Damages – Interest – Personal Injuries – Damages awarded for past services provided to the appellant gratuitously – Whether interest should be allowed – Rate of interest – Commercial rate or Gogic rate.
GLEESON CJ, GAUDRON, McHUGH, GUMMOW AND HAYNE JJ. On 15 February 1989, the appellant, then aged 39 years, sustained severe brain damage, and other serious injuries, when a motor vehicle driven by the respondent collided with the appellant as he was riding his bicycle along Parkes Way in the Australian Capital Territory. The appellant was treated in hospital until 23 December 1989 when he was discharged to his parents' care. Because of the injuries he suffered, he has required care since his discharge from hospital. For all practical purposes, his parents provided all of that care up to the time of the proceedings to which reference will later be made.
The question in this appeal is what, if any, interest should be allowed pursuant to s 69 of the Supreme Court Act1933 (ACT) on the amount of damages awarded to the appellant in respect of services rendered to him by his parents, without reward, between the date of his discharge from hospital and the date on which the damages were assessed[1].
On 19 September 1989, the appellant commenced an action in the Supreme Court of the Australian Capital Territory against the respondent claiming damages for the injuries he had sustained. The action came on for trial before Master Hogan. Liability was not disputed. On 8 December 1995, the Master gave judgment for the appellant for $4,240,646.60. An amount of $250,000 was allowed for the value of past services provided by the appellant's parents. The Master refused to award interest on that sum.
The present respondent, the defendant in the action, appealed to the Full Court of the Supreme Court of the Australian Capital Territory and the appellant cross‑appealed. By that cross‑appeal the appellant alleged that the Master had erred in failing to…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
Grincelis v House [2000] HCA 42
Case
[2000] HCA 42
Decision Date
CaseChat Overview and Summary
The case of *Grincelis v House* involved an appeal to the High Court of Australia concerning the assessment of damages, specifically the inclusion of interest on an award for gratuitous services provided to the appellant. The dispute centred on whether interest should be awarded on damages calculated on the basis of the market cost of such services, even though they were provided gratuitously.
The primary legal issue before the High Court was whether the appellant was entitled to an award of interest on the damages assessed for past gratuitous care. This question required the Court to consider the application of section 69 of the *Supreme Court Act 1933* (ACT), which mandates the award of interest unless good cause to the contrary is shown, and how this provision applied to damages for services provided without charge.
The majority of the Court, comprising Gleeson CJ, Gaudron, McHugh, Gummow, and Hayne JJ, focused on the statutory requirement for awarding interest. They addressed the respondent's argument that awarding damages based on market cost, which includes components like superannuation and workers' compensation insurance, constituted a windfall for the appellant. The majority noted the complexities and imponderables inherent in assessing damages for gratuitous care, particularly when calculated at market rates. They acknowledged that market cost calculations might include elements not directly incurred by the recipient of gratuitous care and that such calculations could differ from the practical reality of gratuitous assistance.
The High Court allowed the appeal, setting aside the order of the Full Court of the Federal Court of Australia. The Court varied the original order by increasing the sum awarded, reflecting a revised calculation of damages. The application for special leave to cross-appeal was dismissed.
Orders
Orders of the court
1.
Appeal allowed with costs.
2.
Vary paragraph 1 of the order of the Full Court of the Federal Court of Australia made on 1 July 1998 by deleting the sum of $4,524,910 and substituting the sum of $4,680,370.
3.
Application for special leave to cross-appeal dismissed with costs.
As the majority (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ) have pointed out attention must first be focused upon s 69 of the Supreme Court Act 1933 (ACT)[89], which provides that unless good cause to the contrary be shown an award of interest at such rate as the Court thinks fit should be allowed[90]. [89]"69 Interest up to judgment (1)In any proceedings for the recovery of any money (including any debt or damages or the value of any goods) the court shall, upon application, unless good cause is shown to the contrary –(a)order that there be included in the sum for which judgment is given interest at such rate as the court thinks fit on the whole or any part of the money for the whole or any part of the period between the date when the cause of action arose and the date as of which the judgment is entered; or(b)without proceeding to calculate interest in accordance with paragraph (a), order that there be included in the sum for which judgment is given a lump sum in lieu of any such interest. (2)Subsection (1) does not – (a)authorise the giving of interest upon interest or of a sum in lieu of such interest; (b)apply in relation to any debt upon which interest is payable as of right whether by virtue of an agreement or otherwise; or(c)affect the damages recoverable for the dishonour of a bill of exchange. (3)Where the sum for which judgment is given (in this subsection referred to as the 'relevant sum') includes, or where the court determines that the relevant sum includes, any amount for – (a)compensation in respect of liabilities incurred which do not carry interest as against the person claiming interest or claiming a sum in lieu of interest;(b)compensation for loss or damage to be incurred or suffered after the date on which judgment is given; or(c)exemplary or punitive damages; interest, or a sum in lieu of interest, shall not be given under subsection (1) in respect of any such amount or in respect of so much of the relevant sum as in the opinion of the court represents any cash amount."[90]Reasons of Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ at [7]‑[8]. In this case the substance of the respondent's argument was that because the assessment here was made upon the basis of the market cost of the provision of the services (in conformity with what was held in Van Gervan v Fenton[91]), the appellant had in effect received a windfall, because the market cost included components for superannuation and workers' compensation insurance, being components of loss which would never be incurred in respect of, and were totally inappropriate for inclusion as damages for, gratuitous care. To those items others might well be added. The market cost of such services may include a loading to cover a commission or service charge payable to an agency by the person performing the services for reward. No attempt was made in this case to explore income tax advantages or ramifications (if any) that might be involved if the injured plaintiff were actually required to outlay money for the services. There is a further matter which is sometimes overlooked, and that is that the market cost will almost always be based upon the period of the attendance of the provider of the services at the residence of the injured plaintiff, even though during the period of attendance the provider will rarely be occupied throughout in providing services. By contrast, a gratuitous carer will often be in attendance by choice or obligation, moral or otherwise, at the injured person’s premises, whether services are being provided or not. The whole area is fraught with imponderables. And in some jurisdictions in Australia there is not the opportunity to award damages on a provisional basis or to structure settlements in such a way as to do greater justice with respect to care and services and their actual or notional cost[92]. [91](1992) 175 CLR 327. [92]See Halsburys Laws of England, 4th ed, vol 12(1), paras 930-931 for a discussion of the position in the United Kingdom. See also, for example Motor Vehicle (Third Party Insurance) Act 1943 (WA), s 16(4); Supreme Court Act 1935 (SA), s 30b (discretion to depart from lump sum awards); Supreme Court Act 1970 (NSW), Pt 5 Div 2 (provisions for interim payments); Motor Accidents Act 1988 (NSW), s 81; and Transport Accident Act 1986 (Vic), s 72.