Ho v Powell

[2001] NSWCA 168

Reported Decision: 51 NSWLR 572

New South Wales

Court of Appeal

CITATION:	HO V. POWELL [2001] NSWCA 168
FILE NUMBER(S):	CA 40398/00
HEARING DATE(S):	14 May 2001
JUDGMENT DATE:	13 June 2001
PARTIES :	Jim Ho - Appellant Adam Baden Powell - Respondent
JUDGMENT OF:	Beazley JA at 1; Hodgson JA at 2-61 & 85; Davies AJA at 62

LOWER COURT JURISDICTION :	District Court
LOWER COURT FILE NUMBER(S) :	5120/98
LOWER COURT JUDICIAL OFFICER :	Gibb, DCJ

COUNSEL:	Mr. J.D. Hislop QC with Mr. D.J. Russell for appellant Mr. D.G. Nock SC with Mr. P. Jones for respondent
SOLICITORS:	W.R. Harvey & Associates, Parramatta for appellant Sanders Simpson & Freed, Caringbah for respondent
CATCHWORDS:	EVIDENCE - Onus of proof - Issue on which party bearing onus was the only witness able to give direct evidence - Deliberate decision not to call party - Applicability of Jones v. Dunkel principle - EVIDENCE - Hearsay - Double hearsay admitted for different purpose - Whether Evidence Act s.60 excludes application of hearsay rule - DAMAGES - Loss of travel benefits - Whether damages equal to face value of travel benefits lost. D.
LEGISLATION CITED:	Evidence Act ss.38, 60, 136
CASES CITED:	Davies v. Taylor [1974] AC 207 at 219 Briginshaw v. Briginshaw (1938) 169 CLR 638 at 642-3 Blatch v. Archer (1774) 1 Cowp. 63 at 65 (98 ER 969 at 970) Azzopardi v. The Queen [2000] HCA 25 par.10 Jones v. Dunkel (1959) 101 CLR 298 Commercial Union Insurance Co. of Australia Ltd. v. Fercom Pty. Ltd. (1991) 22 NSWLR 389. Vocisano v. Vocisano (1974) 130 CLR 267 Lee v. The Queen (1998) 195 CLR 594 Norris v. Blake (No.2) (1997) 41 NSWLR 49 at 75 Betts v. Whittingslowe (1945) 71 CLR 637 at 648-9 Sutherland Shire Council v. Heyman ((1985) 157 CLR 424 at 467 Chappel v. Hart (1998) 195 CLR 232 at 239 Commonwealth of Australia v. McLean (1996) 41 NSWLR 389
DECISION:	See par.85 of judgment

CA 40398/00

DC 5120/98

BEAZLEY JA

HODGSON JA

DAVIES AJA

Jim HO V. Adam Baden POWELL

The respondent, who was the plaintiff at first instance, was cycling, when he was involved in a collision with a car driven by the appellant. The appellant admitted a breach of duty of care to the respondent, but alleged contributory negligence inter alia on the basis that the respondent had no front light on his bicycle.

The appellant was present at the hearing but was not called to give evidence, and no explanation was given for not calling him. The trial judge inferred that there was nothing the appellant could say that would have assisted his case in respect of the allegation of contributory negligence.

The trial judge found that the respondent was at fault in not taking reasonable care for his own safety, but was not satisfied that this negligence caused or contributed to the causation of the accident.

The respondent’s employment with Qantas was terminated because of the accident, and as a result, the respondent lost, inter alia, the entitlement to the benefit of discounted air travel.

Held, allowing the appeal in part:

1. (per Beazley and Hodgson JJA, Davies AJA dissenting) In deciding facts according to the civil standard of proof, a court must determine the probabilities having regard not only to the material before the court, but also to the ability of parties, particularly the party bearing the onus of proof, to lead evidence on a particular matter, and the extent to which it has done so; and accordingly, in determining whether it was more probable than not that the respondent’s negligence contributed to the causation of the accident, it was appropriate for the trial judge to take into account that the appellant was not called to give evidence, and not to be satisfied that the respondent’s negligence contributed to the accident.

2. (per Beazley JA, Hodgson JA and Davies AJA) In determining the amount to be awarded for lost entitlements, it was necessary to determine the value of the travel entitlements to the respondent, which was not necessarily the same as the savings which would have been achieved by the respondent’s use of the entitlements as compared with the cost of similar travel to other persons.

*********

CA 40398/00

DC 5120/98

BEAZLEY JA

HODGSON JA

DAVIES AJA

Jim HO V. Adam Baden POWELL

JUDGMENT

1   BEAZLEY JA: I agree with the reasons of Hodgson JA set out below.

2   HODGSON JA: At about 11.30pm on 1st October 1994, the respondent, who was the plaintiff in the proceedings, was cycling along Rocky Point Road, Kogarah, when he was involved in a collision in a car driven by the appellant. The respondent claimed damages for injury suffered in that collision. The appellant admitted a breach of duty of care to the respondent, but alleged contributory negligence.

3   The resulting proceedings were heard in the District Court by Gibb, DCJ. Her Honour rejected the defence of contributory negligence, and awarded the respondent damages of $1,203,681.98 plus interest $7,923.00.

4   The appellant has appealed on the question of contributory negligence, and also on two questions concerning quantum of damages, the first relating to economic loss, and the second relating to the value of lost employment benefits. I will deal in turn with each question.

CONTRIBUTORY NEGLIGENCE
Background

5   Just prior to the accident, the respondent, then 21 years old, was cycling southwards along Rocky Point Road at about 30 kilometres per hour, approaching an intersection with Toomevara Street. There were two lanes in each direction in Rocky Point Road, and the respondent was in the kerbside lane. The respondent saw the appellant’s car stationary in the oncoming centre lane, apparently waiting to turn right into Toomevara Street; and then the respondent saw the appellant’s car starting to turn in front of him. The respondent did not have time to stop, and he swerved left to reduce the severity of the collision; but there was nevertheless a severe impact in which the respondent was seriously injured.

6   There was no front light on the respondent’s bicycle. He had a rear light on the bicycle, and reflective metallic strips on his shoes. However, the street visibility was good, from high pressure sodium street lights. The appellant’s claim of contributory negligence was based on allegations of inadequate lighting on the respondent’s bicycle, excessive speed, and failure to keep a proper lookout.

7   At the hearing, the appellant’s counsel, just before lunch on the second day, indicated that he wished to call the appellant to give evidence that afternoon; but after lunch, the appellant’s counsel said that, although the appellant was still there, he no longer intended to call the appellant either that afternoon or at any time in the case.

Decsion of Trial Judge

8   The trial judge found that the respondent was at fault in not taking reasonable care for his own safety by failing to have an illuminated front light on his bicycle; but she rejected the contention that he was at fault in either travelling at excessive speed or failing to keep a proper lookout.

9   However, she found in favour of the respondent on the question of contributory negligence, because she was not satisfied that the respondent’s negligence caused or contributed to the causation of the accident. Her Honour noted that the appellant did not testify, and inferred ‘that there was nothing that he could say that would have assisted his case (in respect of the allegation of contributory negligence)’. Subsequently, her Honour said:

But it does not follow necessarily that the accident was caused by Mr Powell's lack of visibility to the defendant, or, indeed, anything to do with visibility. Putting to one side the extreme position of a reckless or careless driver, it is equally possible that the defendant saw Mr Powell perfectly clearly and misjudged the situation; did not see him at all; perceived him indistinctly; or misjudged his position because of a lack of visual acuity.

The defendant could have misjudged Mr Powell's position on the road for many reasons. Some obvious hypotheses do not have regard to anything to do with Mr Powell's visibility to the defendant. Dr Olsen's schematic diagram indicates that the southbound road widens from one to 2 lanes about 15 metres north of the collision point. The defendant's Ford Falcon sedan was about 20 or 22 years old (a 1972 to 1974 model according to Mr Flemming and a 1972 model according to the police traffic collision report). There may have been a mechanical failure. The defendant may have misjudged his acceleration, speed or the width of the road. There are other possible explanations for the accident that have nothing to do with the visibility of the plaintiff to a driver in the defendant's position.

I am of the view that the defendant fails in his allegation of contributory negligence because in my view the evidence is neutral in that there is no evidence which is not equally consistent with the existence and with the non-existence of a fact that is essential to his allegation: namely that the accident was caused by a problem of visibility. It is equally possible that the exclusive cause of the accident was a careless and unexpected act by the defendant that was completely unrelated to anything to do with Mr Powell (sic) visibility to the diver (sic). I find no contributory negligence on the evidence before me.

Submissions on Appeal

10   Mr. Hislop QC for the appellant submitted that the respondent’s conduct in riding a bicycle for some distance at night without a front light was extremely dangerous and grossly negligent. He submitted that the trial judge was in error in stating that there was “no evidence” not equally consistent with the existence and non-existence of the causation of the accident through a problem visibility. He submitted that this was both inconsistent with other findings by the trial judge, and also mistaken, in that there was evidence that the appellant did not see the respondent.

11   On the first matter, Mr. Hislop referred to the following passages from the judgment:

The defendant could - indeed should - have seen the cyclist. There is nothing to suggest that he did. He could - indeed should - have averted the accident. There is nothing to suggest that he failed to do so other than by oversight. In any event, he has conceded his breach of duty.
...
Mr. Powell was the only vehicle on the road, and thought that Mr. Ho had seen him (Mr. Powell). He was wrong. What Mr. Powell failed to see was that the defendant either had not recognised that the cyclist was approaching or had not put himself in a position to avoid a collision.

12   Mr. Hislop also referred to a report of an engineer which had been tendered by the plaintiff/respondent, without objection, which contained the following passage:

The defendant who was the driver of the car was making a right-hand turn into Toomevara Street. He in a statement to the insurance investigator advised that he had come to a halt in Rocky Point Road prior to commencing his turn. He was moving slowly into the turn. He did not see the cyclist at all prior to the collision according to his statement.


Mr. Hislop submitted that, such material having been tendered by the respondent, it was evidence that the accident was caused by a problem of visibility.

Decision

13   The onus lay squarely on the appellant to prove not only that the respondent failed to take reasonable care for his own safety, but also that this contributed to the causation of the accident.

14 There is a long-standing controversy whether the civil standard of proof requires a numerical probability in excess of 50 per cent (see Davies v. Taylor [1974] AC 207 at 219), or belief amounting to reasonable satisfaction (see Briginshaw v. Briginshaw (1938) 169 CLR 638 at 642-3). My own opinion is that the resolution of the controversy involves recognition that, in deciding facts according to the civil standard of proof, the court is dealing with two questions: not just what are the probabilities on the limited material which the court has, but also whether that limited material is an appropriate basis on which to reach a reasonable decision. I discussed this in some detail in an article published at (1995) 69 ALJ 731.

15 In considering the second question, it is important to have regard to the ability of parties, particularly parties bearing the onus of proof, to lead evidence on a particular matter, and the extent to which they have in fact done so: cf. 69 ALJ at 732-3, 736, 740. As stated by Lord Mansfield in Blatch v. Archer (1774) 1 Cowp. 63 at 65 (98 ER 969 at 970):

All evidence is to be weighed according to the proof which it was in the power of one side to have produced, and in the power of the other to have contradicted.

See also Azzopardi v. The Queen [2000] HCA 25 par.10.

16 The case of Jones v. Dunkel (1959) 101 CLR 298 is a particular application of this principle. That case itself related to a situation where there was evidence supporting an inference against a party, and that party did not give or call evidence, which that party was plainly in a position to have given or called, in order to explain or contradict the material presented. In my opinion, a similar principle applies where a person bearing the onus of proof does not give or call evidence which that person is plainly in a position to give or call; and unless some explanation is given of this failure, the tribunal of fact is entitled to infer that this evidence would not have assisted that person’s case: cf. Commercial Union Insurance Co. of Australia Limited v. Fercom Pty. Limited (1991) 22 NSWLR 389.

17   In the present case, the bare circumstances of the accident could support an inference that the lack of a front light on the respondent’s bicycle contributed to the accident, in that a front light would have made it more probable that the appellant would have seen the bicycle and correctly judged its speed, and thereby that the accident would have been avoided. There are of course other reasonable possibilities. The appellant might have been distracted, perhaps because he was looking for something in the car or answering a mobile phone, in such a way that he would not have seen the bicycle even if it had displayed a front light. He might have seen the bicycle as well as he would have seen it if it had displayed the light, but assumed it would stop for him or avoid him, or otherwise misjudged the situation or paid no regard to the bicycle. But if nothing more could be known about the circumstances (for example, if the appellant had been killed in the accident), these possibilities would I believe be considered less likely than the possibility that the absence of the front light did contribute to the accident. If there had been a satisfactory explanation for not calling the appellant to give evidence, then in my opinion that inference could and should have been drawn.

18 However, plainly a deliberate decision was made not to call the appellant, who was in court available to give evidence. It seems clear that the only relevant evidence that the appellant could have given in the case concerned the role of the respondent’s negligence in the causation of the accident: the appellant’s own liability was admitted. The case was no doubt being conducted in the name of the appellant by the appellant’s insurer, so the choice not to call the appellant was probably not that of the appellant himself. However, if there was some difficulty with calling the appellant, other than that his evidence would not have supported his case on causation, then this difficulty could itself have been the subject of evidence. Furthermore, under s.38 of the Evidence Act, if his evidence was unfavourable to his case, his counsel could have sought leave to cross-examine him, even though the case was being conducted in his name: s.38(7) overcomes the contrary view taken in Vocisano v. Vocisano (1974) 130 CLR 267 in relation to earlier statutory provisions.

19   No explanation whatsoever was given for not calling the appellant. In all the circumstances, the inference drawn by the trial judge that the appellant’s evidence would not have assisted the appellant’s case on the role of the respondent’s negligence in causing the accident was proper, indeed almost inevitable. The appellant was the one and only person who could have given direct evidence about the significance of the absence of the light in the causation of the accident. Having drawn the inference that his evidence would not have assisted the case that the absence of the light did contribute to the causation of the accident, the trial judge would then have been justified in concluding that the whole of the material before her did not make it more probable than not that the absence of the light contributed to the causation of the accident.

20   In my opinion, on a fair reading of the trial judge’s reasons, this is essentially the basis of her conclusion. The word “oversight” relied on by Mr. Hislop is a very general word, and does not suggest looking but not seeing, rather than failing to see because distracted or seeing but misjudging. The reference to the respondent being wrong in a belief that he had been seen is qualified by the next sentence, which makes it clear that the trial judge is not there intending to find that the appellant did not see the respondent. The trial judge’s reference to “no evidence” is in my opinion fairly understood as meaning that the whole of the material before her did not make one conclusion more probable than the other.

21   As regards the passage in the expert’s report concerning a statement by the defendant, it was frankly conceded by the appellant that, although the Jones v. Dunkel point was argued before the trial judge, there was no reliance placed on this piece of evidence on this question before the trial judge. Had such reliance been placed, in my opinion this material, being double hearsay, would not have been admissible on this point under s.60 of the Evidence Act. Section 60 is in the following terms:

60. The hearsay rule does not apply to evidence of a previous representation that is admitted because it is relevant for a purpose other than proof of the fact intended to be asserted by the representation.

22 In this case, evidence was admitted of a previous representation, namely a representation by the expert that the appellant had made a statement that he did not see the respondent. Section 60 meant that the hearsay rule did not apply to the expert’s representation; but that only had the effect of making that representation evidence of the fact represented, namely that the appellant had made the statement. In my opinion, that does not mean that evidence that the appellant had made a statement was admitted because it was relevant for some other purpose, so as to engage s.60 in relation to the appellant’s statement. Furthermore, the expert was apparently not himself asserting the truth of the appellant’s statement: see Lee v. The Queen (1998) 195 CLR 594.

23   Even if I were wrong on this, there would have been a substantial possibility that, if the matter had been raised, the trial judge would have made an order under s.136 of the Evidence Act preventing that material being used for that purpose. Section 136 is as follows:

136. The court may limit the use to be made of evidence if there is a danger that a particular use of the evidence might:
(a) be unfairly prejudicial to a party, or
(b) be misleading or confusing.

24   In any event, in my opinion that piece of evidence could not be given any significant weight, in circumstances where the deliberate choice was made by the appellant not to give evidence. I do not think the existence of that material, not relied on below, substantially affects the situation as I have discussed it.

25   Accordingly, in my opinion, no error on this question has been shown. Indeed, I believe the trial judge’s decision on this question was correct.

economic loss
Background

26   At the time of the accident, the respondent was an apprentice mechanical engineer employed by Qantas, and he was in the final year of his apprenticeship. He completed his apprenticeship in April 1995, but did not return to engineering tasks, because he was not physically capable, by reason of the injury he had sustained.

27   He returned to work after the accident in February 1994. He was initially employed in what was referred to the tool group, and he was subsequently employed in the maintenance scheduling department.

28   In July 1997, the respondent’s orthopaedic surgeon advised Qantas that the respondent would not be fit to return to his pre-injuries duties. On 25th July 1997, Qantas notified the respondent that it was unable to offer him a permanent position; and on 24th October 1997, Qantas terminated his employment on the ground of medical unfitness.

29   The respondent would have been able, without further work, to complete his qualification as a maintenance scheduler. However, he did not do so. He was upset by the termination of his employment, and decided to do something different. He undertook a Bachelor of Arts degree at the University of Western Sydney, majoring in the Spanish language. He wishes to become an interpreter.

Decision of Trial Judge

30   The trial judge awarded the respondent $97,409.00 for past economic loss, on the basis that his absence from the work force in the past was by reason of his pursuit of retraining, and that this was appropriate.

31   The trial judge awarded $417,404.00 for future economic loss, on the basis of the difference between a calculation of the present worth of future earnings as a mechanical engineer with Qantas, and a calculation of the present worth of income likely to be earned as an interpreter, less 25 per cent for vicissitudes.

Submissions on Appeal

32   Mr. Hislop submitted that the respondent should have obtained his qualification as a maintenance scheduler, and pursued work in that field. The qualification would have enabled him to work not only in the airline industry, but also in other industries. Had he done so, the retraining, involving the six years between 1997 and 2003, would have been unnecessary, and he would have had earnings close to the earnings he would have had as a mechanical engineer. The onus was squarely on the respondent to prove mitigation, and the trial judge had described his decision not to pursue qualification as a maintenance scheduler as being “unfortunate”. Mr. Hislop submitted that the trial judge had not properly addressed the question of whether the respondent had discharged the onus of proving mitigation of damages. The trial judge’s description of his undertaking of retraining as “appropriate” and “a proper consequence of the accident” was an insufficient indication that her Honour had addressed this question.

33   Mr. Hislop submitted that, in addition to the 25 per cent for vicissitudes, there should be a substantial additional allowance for the fact that the respondent could have continued in the field of maintenance scheduling. Furthermore, the addition of 10 per cent to the usual 15 per cent deduction for vicissitudes was apparently on the basis that the calculation of the worth of earnings as an interpreter was made without allowance for increases in salary; and this meant that the 25 per cent deduction was insufficient.

Decision

34   In my opinion, the appellant has not demonstrated error in the approach of the trial judge. In my opinion, the finding that the respondent’s conduct in undertaking retraining was appropriate, and a proper consequence of the accident, did amount to a finding that what the respondent was doing amounted to reasonable mitigation; and no basis is shown for overturning her Honour’s decision on this question. Furthermore, I am not satisfied that the calculation of earnings as an interpreter was vitiated by the assumption that there would be no increases in salary, and I am not satisfied that the deduction of 25 per cent for vicissitudes was inadequate. Accordingly, the appeal on this basis fails.

LOSS OF BENEFITS
Background

35   The respondent lost the entitlement to benefits which he would have had by virtue of employment with Qantas, especially the benefit of discounted air travel.

36   The respondent relied on a calculation of the valuation of those benefits, made on certain assumptions. The report assumed that the respondent would marry at 30, have one child at age 35, and a further child at age 36.

37   It assumed that in each of the two years commencing February 2001, the respondent would have taken four overseas trips, one to London or a similar destination, one to Hong Kong or a similar destination, and one each to New Zealand and Bali or similar destinations. It was assumed that for these trips the respondent would have had the benefit of business class seats for 10 per cent of the ordinary cost. It was assumed that in each of the five years commencing February 2003, the respondent and his wife would have made four similar trips, on a similar basis. It was assumed in the year commencing February 2008, the respondent and his wife and one child would have made three overseas trips, omitting one trip to a destination such as New Zealand or Bali, but otherwise on a similar basis. It was assumed that in each of the seventeen years commencing February 2009, the respondent, his wife and two children would have made three similar overseas trips on the same basis. It was assumed that in the year commencing February 2026, the respondent and his wife and one child would have made three similar overseas trips. It was assumed that in each of the eleven years commencing February 2027, the respondent and his wife would have made four overseas trips, similar to the trips assumed in the years before the arrival of children. It was assumed that in each of the ten years commencing February 2038, the respondent and his wife would have made three overseas trips, again omitting one of the trips to a destination like New Zealand or Bali.

38   Accordingly, it was assumed that in each of the two years commencing 2001, the respondent would have saved about $13,000.00 on overseas business class air fares; that in each of the following five years, the respondent and his wife would have saved about $26,000.00 on business class overseas airfares; that in each of the following nineteen years, the respondent and his wife and children would have saved between about $40,000.00 and $50,000.00 in business class overseas air fares; and that in each of the following nineteen years, the respondent and his wife would have saved about $26,000.00 in business class overseas air fares.

39   The respondent’s evidence was that he agreed with the assumptions on which the accountant’s report was based, including the assumption as to how often he intended to fly. He also gave evidence that, the year before the accident, he had four overseas trips, one to London, one to Hong Kong, one to New Zealand and one to Bali. That was his third year with Qantas; and he had started to make a lot more money in that year, so he took advantage of the travel benefits. He said that he had just over seven weeks annual holidays. His father had worked for Qantas, and he had quite a few cheap trips with him.

40   A maintenance co-ordinator employed by Qantas also gave evidence, and he said he had fully used his travel entitlements, and had been many on trips in his thirty-three years of service.

41   As regards the other matter of lost benefits, the respondent’s evidence quantified the loss of benefits by reason of the loss of entitlement to future employee share issues at $17,346.00, on the basis of a share issue valued in the order of $1,000.00 per annum. The appellant’s contention that the likely value of any such share issue was closer to $600.00 per annum, and the defendant agreed with quantification in the sum of $10,407.00.

Decision of Trial Judge

42   On the question of the loss of travel benefits, the trial judge gave the following reasons:

Mr Powell has also lost entitlement to various benefits, which he had possessed by virtue of his employment with Qantas. Those that were quantified were an entitlement to discounted air travel, both domestic and international, and an entitlement to various share issues. The circumstances in which any of these benefits may be crystallised and their monetary worth are variable. Furzer Crestani Services calculated the net value of the airfare discounts by reference to assumptions that Mr Powell would marry at 30, have one child at 35 and a second at 36, travel regularly overseas with his spouse and children, and abandon his international travel at 75 years of age.

On that basis, Furzer Crestani Services projected that Mr Powell had lost future benefits in the sum of about $608,115 (before deduction for vicissitudes). The assumptions are not unreasonable. But speculation it is. There are, of course, some swing and roundabouts in the assumptions. One might just as well speculate about an earlier marriage, or none, more children or less, and children who remain dependent longer than Furzer Crestani Services assumed.

The defendant submitted that Furzer Crestani Services' calculation should be viewed as the plaintiff's best case, and that the sum appropriate for award for damages for the loss of this benefit is less than $200,000, although there could be no precise quantification. In my view the Furzer Crestani Services' projection is not unreasonable. It is not a maxim claim.

There is at least a significant probability that Mr Powell's domestic life would have panned out in the manner Furzer Crestani Services assumed, and that he would have chosen to exploit the available benefit at least as frequently as Furzer Crestani Services assumed for the purposes of its calculation. There can be no mathematical precision about the calculation of a degree of probability of occurrence of events so inherently unpredictable. The plaintiff’s counsel conceded that a higher rate of discount for vicissitudes should be applied to this calculation that for the purposes of the income calculation, perhaps in the order of 20 to 25%. A higher rate is appropriate. In my view the appropriate discount rate is in the order of 35%, yielding. a figure of $395,275.

Again, I note that I would have reached a similar result by applying the principles in Malec v JC Hutton Pty Ltd . On that basis, given in the increased number of variables in the projection, 1 would have applied a lower degree of probabilities, and would have assigned the prospects of the benefits being realised as Furzer Crestani Services projected as being in the order of 65%. That yields approximately the same result as is produced by applying the higher rate of discount for vicissitudes.

I award Mr Powell damages in the sum of $395,275 for future economic loss by reason of loss of benefits in the form of discounted travel.

43   On the question of loss of entitlement to share issues, the trial judge adopted the defendant’s figure of $10,407.00, applied 10 per cent for vicissitudes, and arrived at a figure of $9,336.00.

Submissions on Appeal

44   Mr. Hislop submitted that the allowance for loss of travel benefits was excessive, as it failed to make any or any adequate allowance for relevant factors, including that Qantas may have discontinued or reduced the benefits; that the respondent may have ceased to be employed by Qantas; that the respondent may in the future obtain employment with similar benefits; that the projections as to the respondent’s marriage and family may not be accurate; that use of the available benefits might be prevented by time constraints, ill health, other commitments, preference for non-flying holidays, etc.; fringe benefits or other taxes actual or which may attach in the future; and that the benefits were calculated on the basis of full business class fares. In general, Mr. Hislop submitted that it was unrealistic to believe that a married man with children would take three or four international trips per year, out of only seven weeks holiday. He submitted that this head of damage, because of its highly speculative nature, did not permit precise mathematical calculation; and that the respondent would be adequately compensated by a lump sum in the order of $100,000.00.

45   In relation to the loss of share benefits, Mr. Hislop submitted that the allowance for vicissitudes of 10 per cent was too low, having regard to the many speculative factors involved.

46   For the respondent, Mr. Nock SC submitted that the matters raised by the appellant as leading to a possibly excessive calculation were considered by the trial judge, who accordingly utilised a 35 per cent discount factor. The travel benefits head of damage was not one of a highly speculative nature: there was evidence from the respondent that he had utilised heavily these benefits, and that he had intended to continue to do so in the future. The evidence of the other employee was to the same effect. The travel benefits were one of the significant attractions of being an employee of Qantas. There was little challenge in cross-examination to the respondent’s evidence on this matter, and none at all to the evidence of the other employee. In the light of the careful analysis by the respondent’s accountants, it was not correct to say that the claim did not permit a precise mathematical calculation, and it would be inappropriate to adopt an in globo approach.

47   As regards the share benefits, having regard to the agreement of the appellant with a quantification of $10,407.00, the low discount for vicissitudes was appropriate, and there was no justification for interfering with the resulting figure.

Decision

48   There is force in Mr. Nock’s submission that the respondent’s evidence to the effect that he agreed with the assumptions in the accountant’s report, including assumptions as to how often he intended to fly, was not significantly challenged in cross-examination.

49   On the other hand, there was some cross-examination on this aspect, and the cross-examination did show that the respondent had taken four overseas flights only in the third year of his employment, when he started earning sufficient money to afford it; and also that his holidays amounted to just over seven weeks a year. I would take that cross-examination as a challenge to the assumption that the respondent would have taken three or four distinct overseas trips, for the most part with his wife and family, in every year for forty-five years, especially having regard to his salary, other commitments, and limited vacation time.

50   Also, the extent of the cross-examination has to be considered in the light of the evidence in chief, which was no more than an answer “yes” to a leading question as to whether he agreed with assumptions in the expert’s report.

51 In dealing with this question generally, I think the appropriate approach would be one akin to that suggested by Clarke JA in Norris v. Blake (No.2) (1997) 41 NSWLR 49 at 75, namely to come to a view as to what course of usage was most probable, and then to make adjustments in order to take account of contingencies of greater or lesser usage and other vicissitudes. That is, I consider the appropriate approach would be to look first for the most probable scenario, and only then begin adjusting for vicissitudes.

52   Taking that approach, I think it is inconceivable that a person with about seven weeks’ holiday per year and with the earnings disclosed in the evidence, would have taken three or four overseas trips in each and every year for forty-five years, including nineteen years in each of which three such trips would have been taken with a wife and a child or children, one to a destination like London, one to a destination like Hong Kong, and one to a destination like Bali or New Zealand. Even if three such trips could be undertaken by such a family for around $5,000.00 for business class air fares, the total cost of such trips would be considerable, and would compete with other demands such as education expenses, rent or mortgage payments, other living expenses, and so on.

53   For that reason, I think it was an error to take the assumptions made in the accountant’s report as a starting point, and only then to consider vicissitudes. It is true that the trial judge did make a substantial 35 per cent allowance for vicissitudes, but in my opinion something like that discount would be required by other vicissitudes referred to by the appellant, such as variation of benefits by Qantas, cessation of employment with Qantas, illness, or the absence of marriage or children. If one did start with the assumptions of the accountant’s report, in my opinion the discount of 35 per cent was far too low, and appealably so.

54   It is therefore necessary to re-assess this element of damages. I would assess the likely usage of the benefits at 30 to 50 per cent less than that assumed by the accountant. I would also have regard to another consideration apparently not raised below, and only indirectly raised in the written submissions, but explored in some detail in oral discussions at the hearing before this Court.

55   In compensating the respondent for loss of these benefits, it is necessary to determine the value of the benefits to the respondent, which is not necessarily the same as the savings that would have been achieved on business class air fares on overseas holidays which he would have taken.

56   Let us suppose that the respondent would in fact have taken three overseas holidays with his wife and children in each of the nineteen years commencing February 2008, and would thereby have used business class travel in each of those years which otherwise would have cost about $40,000.00 to $50,000.00 more than he paid for that travel. The accountant’s report proceeds on the assumption that the loss of this benefit is of no less value than the loss of $40,000.00 to $50,000.00 cash after tax in each of those years.

57   In effect, the accountant’s report assumes that, if the respondent had had the benefit of $40,000.00 to $50,000.00 cash after tax in each of those years, in addition to his salary, it would have been as beneficial to him to have spent it on overseas business class air travel for himself and his family, as to spend it in any other way. In my opinion, that would be an absurd assumption. Although it may well have been beneficial for him to use some of such additional cash for overseas air fares, I think it is plain beyond argument that it would have been most beneficial to have kept at least some of it available for other purposes, whether by choosing to fly overseas less often or not at all, or choosing to fly economy class, or both. In other words, even on the assumption that the respondent would have used his entitlement to the extent postulated in the accountant’s report, the true value of that entitlement is something less than the savings of business class air fares.

58   Taking all these considerations into account, I would substitute $200,000.00 for the figure of $395,275.00 adopted by the trial judge. I have adopted a figure which, in my opinion, is at around the top of what could possibly be justified, because the issue of the quantum of usage was not explored in detail below, and the issue of the difference between the amount of savings of business class air fares and the true value to the respondent was apparently not explored below at all.

59   As regards the share benefits, I am not satisfied there was error in adopting a discount figure of 10 per cent in relation to a figure agreed to by the appellant.

conclusion

60   Accordingly, I would allow the appeal only in relation to the loss of travel benefits, and that would justify a reduction in the total amount awarded of $195,275.00, that is a reduction to $1,008,406.98 plus interest of $7,293.00.

61   As regards the costs of the appeal, the issues on which the appellant failed did increase the costs of the appeal, and I think an appropriate order would be that the respondent pay one-half of the appellant’s costs of the appeal. The respondent should have a certificate under the Suitors Fund if otherwise entitled.

62   DAVIES AJA: The principal facts are set out in the reasons for judgment of Hodgson JA. There are two issues which I should discuss.

63   The first concerns the finding of the learned trial Judge that it was not proved that the contributory negligence of Mr Powell was a cause of the accident.

64   Mr Powell had been riding his bicycle at 11.30pm on the night of Saturday, 1 October 1994. He did not have a front light or any other warning device at the front of his bicycle. His rear light and reflectors pointed only to the rear. As he approached the intersection of Rocky Point Road and Toomevara Street, which street was on his left, Mr Powell saw that Mr Ho’s car was stationary in the centre of the road facing him, waiting to turn right into Toomevara Street. Mr Powell assumed that Mr Ho had seen him and so continued riding towards the intersection. However, Mr Ho turned across the lane in which Mr Powell was travelling. Mr Powell was unable to stop. He collided with the nearside front guard of Mr Ho’s car and was thrown over the car for about 8 metres.

65   The police report put the point of the accident just on Rocky Point Road, adjacent to the entrance of Toomevara Street. It seems that both the bicycle and the car were moving at the time of the collision. Mr Powell gave evidence that, “The last thing I recall was trying to turn with the car in the corner”. In cross-examination, Mr Powell said that he had been unable to stop and that he had tried to swerve to his left to go in the same direction as the car. Before the collision, Mr Powell had been travelling at about 30-35 km/h. The police report recorded Mr Ho’s car at 15km/h. The area was well lit with high pressure sodium street lights spaced less than 20 metres apart on either side of the road. Mr Powell described the area as “really well lit”. Since the accident, Mr Powell has acquired a flashing white strobe light for his bicycle which he uses when riding at night.

66   Mr Ho’s liability was conceded but the issue was raised as to Mr Powell’s contributory negligence, particularly in not having a front light on his bicycle. The onus was on Mr Ho to establish that Mr Powell was negligent in riding without a light and that his failure to do so was a material contributing factor in the accident. The trial Judge found, and it was not in dispute, that Mr Powell failed to take adequate care for his own safety by failing to equip his bicycle with a front light. However, the issue was raised as to whether, had Mr Powell’s bicycle been fitted with a front light, the accident would have been averted, or to put it another way, whether Mr Powell’s negligence contributed to the accident. Mr Ho was not called to give evidence on this or any other issue.

67   The trial Judge made this relevant finding:-

Mr Powell concedes that a headlight would have increased his visibility to drivers. Today he uses a flashing (“strobe”) white light on the front of his cycle when he cycles at night. It is stating the obvious to say that that greater visibility would have reduced significantly the probability that the accident would have happened - if the accident was caused by a relevant visibility problem.
But it does not follow necessarily that the accident was caused by Mr Powell’s lack of visibility to the defendant, or, indeed, anything to do with visibility. Putting to one side the extreme position of a reckless or careless driver, it is equally possible that the defendant saw Mr Powell perfectly clearly and misjudged the situation; did not see him at all; perceived him indistinctly; or misjudged his position because of a lack of visual acuity. ” (Emphasis Added)

68   This is a finding which an appellate court may review as it concerns the inferences to be drawn from the primary facts found by the trial Judge or otherwise established. Regard must be had, nevertheless, to the finding of the trial Judge and to any advantage which the trial Judge may have had by reason of seeing and hearing all of the witnesses.

69   In the present case, it was not suggested by any of the evidence that Mr Ho deliberately drove in front of Mr Powell so as to cause an accident or that there was any mechanical problem with the car. The remaining possibilities were, I consider, those four possibilities which the trial Judge mentioned.

70 Where a failure to take care for the safety of another person or for one’s own safety by failing to adopt an available safeguard has been proved and where the event occurs, which the taking of the safeguard is designed to prevent, then an inference can readily be drawn, in the absence of a factor or factors suggesting the contrary, that the breach of care contributed to the harm which eventuated. See Betts v Whittingslowe (1945) 71 CLR 637 at 648-9; Sutherland Shire Council v Heyman (1985) 157 CLR 424 at 467; and Chappel v Hart (1998) 195 CLR 232 at 239.

71   The trial Judge cited the view of Mr Brown, an expert whose evidence was adduced on behalf of Mr Ho, who referred to the point that bicycles, like motorcycles, are of a relatively small size and are more difficult to see than other vehicles. Mr Brown referred to the fact that, for this reason, newer motorcycles have daylight running headlights. The trial Judge said of Mr Brown’s report that, “The evidence by the defendant’s expert goes no further than concluding that a headlight would have increased Mr Powell’s visibility”.

72   However, it being the case that a front light would have increased Mr Powell’s visibility, it seems to me that the inference can readily be drawn, and in the present case should be drawn, that, if Mr Ho failed to see Mr Powell or perceived him only indistinctly, then the lack of a headlight contributed materially to that situation. So also, if Mr Ho suffered a lack of visual acuity, the lack of a front light on the bicycle increased the chances of the accident.

73   That leaves the trial Judge’s reference to the point that Mr Ho may have seen Mr Powell clearly but misjudged the situation. Here again, it seems to me that, if Mr Ho misjudged the situation, then the lack of a front light on Mr Powell’s bicycle was likely to have contributed to that situation. Mr Ho was driving at night when other vehicles had their headlights shining towards him. Headlights serve, not only to illuminate the road for the driver’s benefit, but also as a warning to other vehicles. If Mr Powell had been riding a bicycle with a flashing strobe light, the light would have served as a warning to Mr Ho and would have brought more strikingly to his attention the fact that there was a bicycle coming at a reasonable speed towards him.

74   In my opinion, on the facts which were established before the trial Judge, the inference should have been drawn that the failure by Mr Powell to take reasonable care for his own safety contributed to the occurrence of the accident. It seems to me that this inference, being an inference that the normal and natural result of failing to have a front light in fact occurred, arises on the facts of the present case. There were no factors suggesting the contrary. The movement of Mr Ho’s car across the road at a modest speed suggests that Mr Ho did not see Mr Powell or did not see him clearly.

75   The trial Judge used the term “perfectly clearly” when postulating the possibility that Mr Ho saw Mr Powell but misjudged the situation. In my opinion, if there is one fact in this case which ought not to be inferred from the facts which occurred, it is that Mr Ho saw Mr Powell perfectly clearly. He may have seen him, but, if he misjudged the situation, it seems to me to be improbable that the view which he had was perfectly clear. If Mr Ho misjudged the situation, it is probable that this was because Mr Ho’s view of Mr Powell was not sufficiently clear and distinct to enable Mr Ho to register fully what the situation was.

76 In the course of the trial Judge’s reasons, reference was made to the well known principle enunciated in Jones v Dunkel (1959) 101 CLR 298. The point made in Jones v Dunkel is that a court may more readily accept evidence given by one party and may more readily draw any inference arising from the evidence because the opposing party has chosen not to give evidence. The principle does not permit an inference to be drawn that the evidence which was not called would, in fact, have been damaging to the party who withheld it. In Jones v Dunkel, at p 312, Menzies J put the matter in this way:-

In my opinion a proper direction in the circumstances should have made three things clear: (i) that the absence of the defendant Hegedus as a witness cannot be used to make up any deficiency of evidence; (ii) that evidence which might have been contradicted by the defendant can be accepted the more readily if the defendant fails to give evidence; (iii) that where an inference is open from facts proved by direct evidence and the question is whether it should be drawn, the circumstance that the defendant disputing it might have proved the contrary had he chosen to give evidence is properly to be taken into account as a circumstance in favour of drawing the inference.

The rule permits evidence to be given greater weight and an inference or inferences to be more readily drawn when the other party who might have called evidence to the contrary has chosen not to do so. In Commonwealth of Australia v McLean (1996) 41 NSWLR 389, Handley and Beazley JJA said:
The rule typically applies to strengthen or weaken an inference otherwise available on the evidence for the benefit of the party not in default.

77   In the present case, I cannot accept that it is likely that Mr Ho saw Mr Powell clearly or that the presence of a flashing front light on Mr Powell’s bicycle would have made no difference. The probabilities of the case seem to me to be the contrary. In this event, the principle in Jones v Dunkel does not assist Mr Powell to defend the claim that his contributory negligence was a cause of the accident.

78   For these reasons, I would uphold the appeal as to contributory negligence and would reduce the damages by 25 per cent for Mr Powell’s share of the blame.

79   On the issue of damages, I agree with Hodgson JA. However, I would add a few words on the issue of the discount airfare benefits which Mr Powell had received from his employer, Qantas. This claim was calculated by taking the gross fares of business class travel on international and interstate flights which, it was said, Mr Powell would have been likely to have taken had he remained with Qantas, and by deducting from the gross figure the 10 per cent cost which Mr Powell would have been charged. In my opinion, this calculation, which was undertaken by an accountant, was fundamentally flawed.

80   Mr Powell was not entitled to any travel benefit which represented money or money’s worth. Employees could travel at, effectively, Qantas’s expense, but employees were not entitled to receive money and they could not convert their entitlements into money. Indeed, Mr Powell’s claim, as it was calculated, was an economic claim only in the sense that that which was being spoken of was an employee’s benefit. What Mr Powell lost, by ceasing to be an employee of Qantas, was not a sum of money but a generous entitlement to travel regularly at a very modest cost. What he lost was a feature of lifestyle, the taking of regular trips overseas and interstate.

81   Necessarily, the value to be placed upon such a benefit will differ from case to case. To some people, the loss of overseas flight benefits will have much more value than it will to others. Unfortunately, Mr Powell gave very little evidence on this aspect of the matter, contenting himself with affirming the assumptions contained in the accountant’s report. Those assumptions included assumptions that Mr Powell would, within a few years, have a wife and two children, though none such was on the horizon at the time of the trial.

82   In the circumstances, it is very difficult for the Court to place a value on the lost entitlements. Hodgson JA has assessed a value of $200,000. I am content to accept that figure, but I would emphasise the point which Hodgson JA has made, that the assessment is arrived at in the absence of any real guidance as to the value that ought to be given to Mr Powell’s lost entitlements.

83   I agree with Hodgson JA on the other aspects of damages which his Honour has discussed.

84   I would order that the appeal be allowed so as to reduce the damages awarded by taking into account 25 per cent contributory negligence and by reducing the allowance for loss of travel rights to $200,000. The respondent should pay the costs of the appeal.

85   HODGSON JA: Accordingly, the orders I propose are these:

1. Appeal allowed in part.
2. Judgment below varied to $1,008,406.98 plus interest of $7,923.00.
3. Respondent to pay one-half of the appellant’s costs of the appeal, and to have a certificate under the Suitors Fund Act if otherwise entitled.
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