Holland v Hardcastle

[1999] HCATrans 350

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Perth  No P52 of 1998

B e t w e e n -

MARTIN HOLLAND

Applicant

and

PHILIP HOBSON HARDCASTLE

Respondent

Application for special leave to appeal

GLEESON CJ
McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT PERTH ON WEDNESDAY, 20 OCTOBER 1999, AT 4.02 PM

Copyright in the High Court of Australia

MR M.J. McCUSKER, QC:   May it please the Court, I appear with my learned friend, MR K.J. BRADFORD, for the applicant. (instructed by Bradford & Co)

MR D.J. HIGGS, SC:   May it please the Court, I appear with my learned friend, MR D. WALLACE, for the respondent. (instructed by Minter Ellison)

GLEESON CJ:   Mr McCusker.

MR McCUSKER:   If it please your Honours.  This is a case where the applicant, who is now 40 years of age, and was at one time in his early 30’s, had a history of back problems, but in December 1991 he underwent an operation, a procedure known as a “Graf procedure”, which the trial judges held there is no issue on this, was one which he did not give informed consent to, which was inappropriate in the circumstances, and there was post‑operative negligence as well.  The result of that was that over a period of some four years he underwent, it would appear unnecessarily, had the original procedure been correct, some seven operations and during that period of time was in considerable pain, indeed agony.  In 1995 he underwent an operation which was corrective and which did not cure his condition but which at least alleviated some of the major pain and suffering that he had endured hitherto.

The court held, and I am referring here to the decision of the Full Court at page 90, that:

In July 1991, prior to the problem of the loosened screw –

which had called for not Graf procedure but a small fix-up job, as it was put:

the appellant was apparently capable of working in the family business of up to 60 or 70 hours a week –

that was evidence given by him which was not in dispute –

performing light duties including paper-work, interviewing representatives and working out lists of supplies to be ordered, whereas the medical evidence is to the effect that the appellant’s condition is now permanent and that he is capable only of light work to the extent of some 20 hours a week.

So, from a condition where up to the point of a loosened screw he was capable of working 60 to 70 hours a week, albeit light duties, he had this operation which caused him, as I say, considerable intervening pain, and ultimately, although that was partly overcome, he was left with residual disabilities and capable of only working for about 20 hours per week.  For a man in his early 30’s, the award made for future economic loss was $5000, which seems to betoken that something has gone wrong in the approach.

In our submission, what went wrong with the approach taken by the learned trial judge and the Full Court, even though the Full Court did correct some errors of the trial judge, was this, that, having made a finding that he was now capable only of light work to the extent of some 20 hours a week, it went on to say at page 90, referring to Mr Slinger’s evidence, an expert whose evidence was accepted, that Mr Slinger had said:

that if, instead of having the Graf procedure.....the appellant had some other procedure it was unlikely that he would ever have been able to return to any sort of heavy manual labour and that, in such a case, Mr Slinger would have advised the appellant, in the strongest possible terms to undertake only light sedentary work in order to avoid problems in the future.  He also said that the chance of the appellant having a complete cure was most unlikely and that it was likely that he would have some continuing symptoms, whatever the result of the operation.

There, at page 91, is set out the evidence of Mr Slinger, which led to that conclusion.  It will be noted midway down page 91, Mr Slinger is being asked:

Do you have any experience of whether people with that sort of history leave the work force earlier than usual?

And his answer:

When you say ‘that sort of history’, are we talking generalisations about people who have had multiple surgery and then have---

To the lower back, yes?---

And then have a further operation on the lower back?

The effect of Mr Slinger’s evidence was that people who have more operations are more likely to suffer after effects, degenerative effects, and therefore leave the work force earlier rather than later.

What we say is the essential error in this case, in the approach by the Full Court, is that first, it concluded from that evidence that it was likely that he would have – I am sorry, I will take you to page 92, where the court, starting at the foot of page 91, said:

In assessing an appropriate award under this heading, regard must be had inter alia to the fact that, had the operation in December 1991 been successful, the physical condition of the appellant might, in any event, have led to his being in time in the same condition in which he now is.

Now “might” is one thing; we say that the approach that should have been taken here was to say, well, he is now capable of only working about 20 hours per week as compared with his pre-June 1991 condition before the screw loosened, where he was capable of working about 60 to 70 hours a week.  The degenerative condition that was foreshadowed as a greater possibility, must have been due, in part, to the intervening operations that he had and to determine first what the loss of earning capacity was, based on the reduced working ability of this man, following the series of operations which should not have been necessary, but were because of the negligence of the respondent, and then applied to that loss of earning capacity, so quantified, a discount to allow for, based on evidence, contingencies such as a reduced period of time in the work force, which might have occurred in any event.  Not to simply say, as the court put it at the top of page 92:

the physical condition of the appellant might, in any event, have led to his being in time in the same condition in which he now is –

had the operation in December 1991 been successful.

GLEESON CJ:   But, as I understand the reference to the judgment of Justice Ipp, immediately following that, this is all in the context of allowances for contingencies?

MR McCUSKER:   Yes, allowances for contingencies, but there has been no assessment of what his loss of earning capacity was and then, in our submission, to apply to that a discount factor, simply nothing there.  The conclusion of the court at page 93, having said at page 92:

the evidence did not support a finding that, following the operation in 1995, the appellant’s condition was restored to what it had been prior to the deterioration in mid-1991.

Having said that, the court at page 93 simply said, in the middle of the page:

After July 1995, the evidence suggests that the appellant was able to perform work for up to 20 hours a week but to be in attendance at his place of work for 35 to 40 hours a week.  His work was not such as to require his constant attention –

and then simply –

In my opinion, the learned trial Judge was not in error in his findings in relation to future economic loss  ‑ ‑ ‑

GLEESON CJ:   Mr McCusker, which of the special leave questions identified on pages 111 and 112 are you addressing us on now?

MR McCUSKER:   Essentially, I think the main point on the special leave application is the question posed at 1.3 and 1.5, and the others I think you will ‑ ‑ ‑

McHUGH J:   That is not a principle that was really in dispute, was it?  I mean, whether or not the trial judge and the Full Court’s judgment are open to criticism, the case was overwhelmingly concerned with factual issues and discretionary value judgments; there is no question of law involved in the case and notwithstanding the way you seek to dress it up.

MR McCUSKER:   Well, the only question of law we can put to your Honour is the question of the approach that was taken being different from the correct approach, an approach which was exemplified by this Court, although different views were expressed in Chappel v Hart.  What is wrong, in principal, and there are a number of other cases ‑ ‑ ‑

McHUGH J:   But it is Malec v Hutton, not Chappel v Hart, that provides the applicable principles.

MR McCUSKER:   Yes, we accept that, your Honour, and the question is whether Malec v Hutton has correctly been applied in this case.

McHUGH J:   Well, that is not a special leave point, as you well know, Mr McCusker.

MR McCUSKER:   Well, it may not of itself be a special leave point, your Honour, but the glaring discrepancy, we say, in the award of damages here for future economic loss is of itself some cause to be rectified, coupled with the fact that there are, as we have said in our outline of argument, quite a number of other cases of the same nature, dealing with this incorrect use of the Graf procedure, which has caused individuals to undergo a period of suffering and then ultimately rectification, and the question in each case is going to be the same kind of question that is raised in this case.  But we say that there are clear errors of approach, or an error of approach, as well as errors in fact, which apply in this case.  There is an error in fact that we have identified at pages 90 through to 91, in categorising, in effect taking Mr Slinger’s evidence as being support for a view that it was likely that the applicant would have, in any event, been in the same condition as he was now.  That is not the effect of Mr Slinger’s evidence and it seems to be on that basis that the court has then simply allowed what is really a trifling sum for future economic loss in a man who was 32 and has gone down from a working capacity of 60 or 70 hours a week to about 20 hours a week.

The further error in principle that we would submit, your Honour, appears here is that there are simply no reasons given for the approach of the Full Court; it is not explained how his working capacity has been diminished in terms of quantum and then, in turn, applied some calculation based on evidence as to the contingencies which would affect the loss of earning capacity.

McHUGH J:   The problem I see about the case is that if we granted special leave in this, we could hardly refuse to grant special leave in numerous cases, where trial judge and Full Court’s judgments are open to some criticism because they did not do this or they did not do that.  There is no point of general principle involved, it seems to me, Mr McCusker.  That is what worries me about the case.

MR McCUSKER:   Your Honour, the concern in terms of principle is that, left uncorrected this may be taken to be a correct approach for the courts to take in the determination of future economic loss in ‑ ‑ ‑

McHUGH J:   I hope not.

MR McCUSKER:    ‑ ‑ ‑ cases such as this.

McHUGH J:   This seems to me to be a case dealing with its own set of facts and, arguably, on your submissions, the court has got it wrong, but it surely is not a precedent for any other case, is it?

MR McCUSKER:    Got it wrong, we would submit earnestly, is got it wrong because of the incorrect approach it took to determination of a future economic loss.  Instead of making an assessment of the economic loss or the loss of earning capacity and then scaling down, it simply referred to some evidence which does not support the observation that the physical condition might, in any event, have led to his being, in time, in the same condition ‑ ‑ ‑

McHUGH J:   Can you say anything more about judgments that they arguably lack precision and in one sense lacks some transparency in terms of the reasoning process; is there anything more to it than that viewpoint?

MR McCUSKER:   Yes, we say that absent the precision and absent the clarity and the reasoning process, one can take it that the court has simply not applied correctly the principles for determination of loss of economic earning capacity and I take the point that your Honour raises, that it might be an opening of the flood gates but, in our submission, it needs to be addressed by this Court so that there will not be a continuation of this approach.

McHUGH J:   But it would be one thing if you would conclude that this case would have some precedent value for the future for all other cases, but it seems to me at the moment there is nothing more involved in it than, arguably, it was wrong on the facts of this case, as opposed to some wrong in principle.

MR McCUSKER:   Well, the principle – I can only just keep repeating myself – is the approach to determination of future economic loss should not be to say, well it might have, in any event, led to us being in the same condition, so we will allow a nominal sum.

McHUGH J:   The trial judge said, “would have”, did he not?

MR McCUSKER:   Yes, “would have”, but the court corrected him on that and it said, “might have”, and we say further, the evidence does not even support that; it is just a speculation, no more.  But even if the evidence supported that inclusion that it might ‑ ‑ ‑

McHUGH J:   This much can be said, that there had to be some discount, had there not, for deterioration in the future, in any event?

MR McCUSKER:   Most certainly, yes; the question is, how does the court go about doing that?  It does not do it, we say, by simply saying, might have been in the same condition, therefore nominal award; it has got to be more than that.  It should be, this is the lost earning capacity based upon the reduction in hours in the future, now let us look at the evidence that supports a discount, what is it?  And the court did not do that.  They are the only submissions I can make, your Honour, apart from the fact, we say, that although cases are rare in which, if there is no new point of law or important point of law involved where special leave is granted, nevertheless, this is a case where the disparity between his likely loss of earning capacity and the award made is such that it calls for intervention by this Court, in the interest of justice.  May it please, your Honours.

GLEESON CJ:   Thank you, Mr McCusker.

The decision in this case turned upon the application to the particular facts and circumstances of settled principle and the case gives rise to no question appropriate to the grant of special leave to appeal.  The application is refused.

Can you refuse an order for costs?

MR McCUSKER:   No, your Honour.

GLEESON CJ:   The applicant must pay the respondent’s costs of the application.

We will adjourn until 9.30 tomorrow morning.

AT 4.19 PM THE MATTER WAS CONCLUDED