King v Zadow - [2004] SADC 193

DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
KING & ANOR v ZADOW
Judgment of His Honour Judge Bright
23 December 2004
DAMAGES - MEASURE AND REMOTENESS OF DAMAGES IN ACTIONS FOR TORT - MEASURE OF DAMAGES - PERSONAL INJURIES - LOSS OF EARNINGS AND EARNING CAPACITY
First plaintiff injured in motor vehicle accident - liability admitted. Soft tissue injuries to back and neck - electrician. First plaintiff's damages assessed at $381,999.
Loss of consortium of second plaintiff assessed at $11,000.

KING & ANOR v ZADOW
[2004] SADC 193

This is an assessment of damages.
The plaintiff was born in 1951. On 26 March 1998 he was the driver of his light van, loaded with electrician’s tools and materials. His car was stationary at traffic lights on Main North Road, Smithfield. With no warning, a semitrailer drove violently into the rear of his vehicle, propelling it some 15 metres across the intersection and into collision with a traffic light standard. There is a suggestion that the semitrailer was travelling at 80 kilometres per hour at impact. That does not seem consistent with the plaintiff’s vehicle being propelled only 15 metres, but I do not have expert evidence about this. It is enough to find that it was a violent impact, for which the plaintiff was entirely unprepared.
The plaintiff was unable to extricate himself from his vehicle due to damage to its right side. Ambulance and rescue personnel attended. Eventually the “jaws of life” were used to free his door. Prior to that, a board was strapped to his back and neck to immobilise him. While trapped and immobile the plaintiff believed he smelled petrol leaking and he was, understandably, very frightened that his vehicle might ignite. Fortunately it did not. He was removed and taken to the Lyell McEwin Hospital for examination and observation. His van was written off.
Obviously he was very shaken and shocked. His injuries appeared to be generalised soft tissue injuries in his back, together with a painful right shoulder. He had a bruise behind his left ear and on his right arm near his elbow. Those bruises resolved normally. Later he developed pain in his left foot. He had pain in his right knee. He was discharged home after about six hours. These problems have not resolved. I will later discuss them in more detail.
The plaintiff was born and educated in Adelaide. He qualified and worked as an electrician. At one period his father, who had a parcel delivery/light trucking business, needed help and the plaintiff conducted that business for a few years. In around 1988 he developed low back pain, with sciatic nerve referred pain. It may well have been associated with heavy lifting to load and unload items being transported in the truck. The exact aetiology is not clear.
The pain was serious enough for the plaintiff to consult his general practitioner and then, on referral, an orthopaedic specialist, Mr Morrison. The latter suspected a facet joint problem and arranged for an injection of the relevant joint. The plaintiff told me that the injection relieved his pain and that, thereafter, he had not had further trouble before the subject accident.
Mr Morrison’s notes record that the plaintiff told him that the injection had not relieved his symptoms. At examination three years later, he was still complaining of pain. I believe Mr Morrison’s notes are much more likely to be accurate than the plaintiff’s present recall. I do not conclude that the plaintiff tried to mislead me about this. I accept his evidence that, after a period of about 6-9 months off work, he went back to the work of an electrician and that any back pain he suffered did not cause him to lose time from work. A significant part of his work involved the installation of wall and window mounted air conditioners. Lifting such units into place is undoubtedly hard work – they are heavy and awkward. He did that regularly for years, without being aware of any weakness in his back.
It seems to me that the original episode of back pain must have largely resolved over about a year, but with some continuing pain at times. Mr Morrison is probably correct to believe now that the problem was not in a facet joint, but was discogenic.
It was not inevitable that that would ever lead to worse trouble. Low back pain is common in the population generally and, in particular, amongst those subject to vigorous physical labour. However, the fact of that episode demonstrates that, in certain circumstances, it could occur again. It is a contingency I must allow for when I assess the future economic consequences of the subject accident.
The plaintiff and a Mr Morris had been friends when electrical apprentices. In about 1989 they and their wives formed a partnership with four equal shares to conduct an electrician’s business. With fluctuations in the building trade came fluctuations in the volume of their business. For some years they had steady, repeat work wiring houses being built by a major developer. At other times they had to distribute flyers throughout their local area to get domestic repair and re-wiring work. I have noted that the plaintiff installed a lot of air conditioners.
To be profitable, work had to be performed quickly, efficiently and correctly. The result was that long hours had to be worked. The work included overhead work and work within the confined spaces of shallow roofs. This required agility, strength and stamina. No doubt the plaintiff was often tired and sore – but he did not need to take time off. He coped. Indeed, he actively pursued work.
His general practitioner is, and was throughout, Dr J Wong. He is vastly experienced in the ethos of the area around Smithfield. He told me that men in that area, typically, judge themselves by their physical prowess, their capacity to work and play hard and to support their families. This is how he sees the plaintiff. I accept that general view. It explains why the plaintiff is more angry, frustrated and depressed at his present limitations than is sometimes the case.
Following the accident, the plaintiff was off work for around three months. He was very sore. He was dependent on his wife for almost all aspects of everyday living. I accept that she had to spend hours each day in tending to him. He gradually improved, but has never fully recovered. For example, she still has to tie his shoelaces, sometimes to put on his socks. He can lift his arms above his head, but cannot work at that height. Changing a light or light globe is about his limit. He cannot hang up washing (I do not think he did that much before the accident, but it is an illustration of a limitation).
At one stage he was subject to quite severe dizzy spells. They seem to have resolved, but he is still afraid to risk them by, for example, working from a ladder. Much of the ordinary work of an electrician is from a ladder. He cannot crawl around in restricted spaces. He cannot lift and manipulate the weights required in the day-to-day work of an electrician.
At home, he mows lawns, but gets others to start the motor of his mower. He gets them to start his leaf blower and hedge clipper. He says he cannot put even that strain on his right shoulder. He is right handed. He will get his wife to empty the grass catcher if it is heavy. He does other light gardening, but does it slowly and carefully.
From his evidence, and from that of others, I accept that the plaintiff is genuine in the problems he described. I am sure he wants to do more. He has accepted various limitations and knows that, if he exceeds them, he will precipitate pain and disability in succeeding hours and days.
He used to play a lot of sport and enjoyed social events.. He now plays no sport – he had more or less given up formal sport by the time of the accident, but now does not even play informally with his grandchildren. He no longer plays golf, at which he was a regular. He socialises little. He is nervous in crowds, fearing a bump to his right shoulder to the extent that his wife now habitually walks at his right side to protect him.
It is thought that he may benefit from a re-section of the right acromio- clavicular joint. No arrangement has been made for this to occur. I find it quite likely that it will be done within the next five years. Allowing for accelerated payment and for the possibility it will not occur, I shall allow two-thirds of the present cost of that operation.
There has never been much to see in the X-rays and other images taken of his back, shoulder, knee or foot. The injuries are, essentially, soft tissue injuries which do not show up in those images. In order to assess the severity of the injuries and their effect, one is almost entirely dependent on the plaintiff. I found him to be honest and straightforward. There was no serious challenge to this. I am satisfied he would do more, if he could.
I accept that he is now moody, irritable and hard to get on with a good deal of the time. He does not go out much. This keeps his wife at home. She finds life a lot harder than it was. Their sex life is diminished. There is no reason to predict much improvement in the future.
The plaintiff has had a few visits to a psychiatrist and more to a psychologist. They do not diagnose much more than a depression reactive to his pain and frustration. That has, to an extent, been exacerbated by worry about this litigation and by the serious financial problems he has had to face. When he told me he nearly lost his home at a couple of stages, he was nearly in tears. His wife has had to go to work to help with finances. To the extent that this litigation will end and he will receive some money to alleviate his financial state, I expect he will be better. It is expected that he will need a few more visits to, in particular, his psychologist over the next six months. Thereafter it is expected that his general practitioner will be able to deal with residual emotional problems.
The plaintiff has had to change the way he ran his business. Prior to the accident it appears that problems were developing with his partner, though they were not yet manifest. Immediately on learning that it could be a good while before the plaintiff could return to work, his partner dissolved the partnership – leaving the plaintiff with no income. Later developments unrelated to the accident revealed that the partnership had probably been teetering before it. The accident pushed it over the edge.
On returning to work, the plaintiff could not perform the physical tasks needed. He engaged sub-contractors to do that. He had always done that when there was too much for him and his partner to do. Now he did so for most of the work he used to do.
He struggled to complete a number of unfinished jobs and then set about creating a different sort of business. He would do the administrative work, he would seek out and quote for jobs. He would supervise. He would give minor physical assistance.
He managed to strike a relationship with a company which makes transportable, pre-fabricated buildings on a repetitive basis. He has the contract to wire them. He organises documentation. He purchases the wire, equipment and materials needed. He has designed and made some specialised equipment that enables his men to do this work quickly and efficiently. He makes up the small switch boxes for each building, installing the necessary switchgear and wiring to enable it to be easily connected up to each building by the sub-contractor on site.
While this work lasts, and while he is able to find a suitable sub-contractor the money is good. It is a very successful change. It illustrates the plaintiff’s determined approach. But I agree with him that he is in a vulnerable position. He now contracts with only one client. There is no guarantee that relations will continue on their present good basis. Someone may undercut him. The builder may squeeze him. His main sub-contractor is an electrician from another country, not qualified to work on his own account, but who will qualify in the next year or so and may then leave the plaintiff. The building industry is notoriously cyclical.
The company with which the plaintiff has his present contract cannot expect to manufacture the units it now manufactures forever. There may be changes in design or in where the manufacturing process occurs.
If, for these or other reasons, the plaintiff loses this contract, I am sure he will apply himself diligently to finding other contracts and work. He is now restricted to particular types of contract – ones where he can administer, but do little of the physical work. He cannot fall back on his training and work by himself at most of the usual work of an electrician. This is a serious limitation.
He may be lucky and he may so manage his business that he will be able to prosper, but, if he is not lucky, he may find himself out of work from time to time and for extended periods. It is at times when the industry is short of work that he is most likely to be in trouble. At such a time there will be a good supply of fit electricians and he will find it very hard indeed to get any work at all.
He is not fit to go back to trucking. Most forms of unskilled labour are beyond him. He does not have the education easily to re-train for most sedentary jobs. Moreover, by habit and inclination, he does not like that work. In short, I expect that his loss of earning capacity is likely to be reflected in a significant loss of actual earnings over the years.
I acknowledge that it is not possible to be sure that all of the symptoms from which he now suffers were directly caused by the accident. It is in the nature of things that the precise aetiology of such injuries can be hard to prove. For example, there is doubt about whether pain in his foot resulted from bracing himself against the brake pedal during the accident and then slipping off it. That could cause trouble. Could he have reacted that quickly? It seems that complaint about it was not made for a long time.
Some aspects of his pain might relate back to whatever caused the back trouble when he was driving a truck. Some may relate to lack of mobility, odd posture or disuse.
I am content to find that the significant cause of his present incapacity was the accident. Such problems as may have other causes are not of such severity that, if they did not exist, the plaintiff’s incapacity would be much different. The main trouble is with back and shoulder. Those injuries were caused by the accident.
The plaintiff’s wife has her separate claim for loss of consortium. I accept her evidence that her life is a lot harder now than before the accident. Apart from the personal help I have mentioned, she also had to spend a lot of time driving the plaintiff around after the accident. At first it was for medical appointments, which were numerous. It is hard to imagine a round trip to a doctor taking less than an hour. Later she drove him around to enable him to quote for and supervise jobs. Eventually he found that he had recovered enough to drive himself in a four-wheel drive car with a high seating position.
The nature of the plaintiff’s work now involves much more office work. While the plaintiff has basic (I take it one or two finger) keyboard skills, he is slow. She is much more adept and has to give much more assistance than she used to give.
He says he does little domestic work in the house. I suspect he never did. He does work in the garden, but only light work. She must now do more.
Since the accident she has trained to work in an aged care centre and does about 16 hours a week of work to boost family finances. Life is not carefree and easy. Without idealising the way things were before the accident, they are now more tense, tiring and irritating. Old friendships are not pursued and outings are infrequent. Life is not so much fun.
Some of the matters I have described can be classed as loss of consortium, others go to the claim for the value of gratuitous services. The general picture is clear enough, without descending to greater detail.
To me, the hardest part of the assessment is to work out what the plaintiff is likely to have earned up to now and for the future, but for the accident. His business records and tax records are in good order. One suggested measure is to see how much has been spent on sub-contractors since the accident. That does not give a clear answer. Sub-contractors were hired before the accident and it is reasonable to think that would have continued. When one looks at the cost of those hired after the accident it is not clear how much of their work would have been performed by the plaintiff. At times it is clear that more than one sub-contractor is working at the same time. Even when only one is working, it is hard to know whether the need for that work was entirely precipitated by the plaintiff’s inability to do it, or whether at least some of the need is inevitable, having regard to the amount of administration necessary to manage the business in its present form and with its present work.
Another suggestion is to look at what an electrician with the plaintiff’s experience and qualifications would earn if employed on award rates. It may be supposed that he would be unlikely to bother to run his own business if it were to generate much less than award rates. One can’t be exact. At times there might not be award work available. The satisfaction of being self-employed is enough for many people to be prepared to put up with risks, more paperwork and even a lower income. But there is a limit!
In my opinion the plaintiff has virtually wholly lost his capacity to work as an electrician. He has fallen back on or acquired a capacity to run an electrical business where he can work in the way I have described and with the risks I have mentioned. His condition is more or less static.
There is no evidence on which to base a finding as to how long the plaintiff might have worked and might still work. Retirement ages now vary widely. As a generality, only those who can afford it retire early. Nothing suggests the plaintiff was ever going to be able to save so much as to have that luxury easily available to him. Sixty five is still a very common retirement age. The plaintiff may have to work longer and that may have been so regardless of the accident. I think the contingency that he would have worked longer about balances the contingency that he would have chosen to retire early. I note that the latter contingency is of choice. I must still allow for the contingency that for any of a variety of obvious reasons the plaintiff may, regardless of the accident, have been unable to work to sixty five.
I have been informed that the plaintiff’s trade qualification does not exactly match the grades set out in the current award. However, it is said he could work at “at least” a grade 5 level. At that level the minimum weekly rate (gross) is $479.10. I will round that to $500 per week. On that, tax would be about $150, leaving a nett wage of around $350.
I must consider the contingency that there would always have been periods when, for one reason or another, he would have earned less. In my view, having regard to the fact that this rate is the minimum and is without overtime, the contingency that he would have earned more, far outweighs the contingency that he would have earned less. I think it would be fair to assume an annual (nett) income of $20,000 to date and a future weekly (nett) income of $400.

The accident was in March 1998, which is 6.75 years ago. 6.75 x $20,000 is $135,000. Looking at the business records, actual income before the accident fluctuated, but seems generally consistent with that. Average (gross) earnings - by the plaintiffs for the six years before the accident were $28,413, which, after tax would be around $20,000 per annum.
I must deduct what has actually been earned up to now. I am satisfied that the plaintiff has done everything he could to minimise his loss of income. Gross earnings have totalled $118,154 to the end of June 2004. I round that up to $125,000 to the present date. The annual income has varied from $3,000 to $66,000, so reducing it to a nett of tax figure can only be rough. I will deduct a third and assume a nett income of $80,000.
On that basis, the lost income to date is ($135,000-$80,000) $55,000. This is the result of one of the plaintiff’s own calculations if the award rate for a grade 5 electrician is substituted for that of a grade 10 electrician, which was used in a table forming part of the plaintiff’s submissions.
The defendant’s counsel suggested that, adopting Dr Blight’s estimate that the plaintiff suffers an overall 30% disability one could award 30% (nett) of the award rate. The defendant took a weekly rate of $798 (gross). That, too, is the rate for a grade 10 electrician. On that basis, the defendant calculated a nett loss of $76,000. Obviously it is less if calculated on the rate for grade 5.
The plaintiff also put forward a calculation based on the cost of sub-contractors since the accident – and I have commented on that approach. This calculation gives a figure of some $190,000. I reject it.
However, I stand back and look at my calculation of $55,000. It seems too low to me. I think that the building industry has mostly been pretty busy. I think that the plaintiff could, if on an award, have worked a lot of overtime. He told me he used to work long hours – often 60 hours per week. Those long hours could either have earned a lot of overtime, or they could have been used in the business to generate more profit by spending less on sub-contractors.
While I am not persuaded that is logical simply to apply Dr Blight’s figure of 30% to the award, in fact the amount calculated by the defendant seems to me to be about right. I shall allow $75,000 for past lost earning capacity.
For the future, I think that the various limitations in what the plaintiff can do and the various ways in which his present lucrative contract could come to an end, suggest that, on average, he is likely to lose more per annum than he has lost so far. Balancing that there was always the chance he would suffer loss for reasons unassociated with the accident.
The rate of loss to date is about $11,111 per annum, or $214 per week (nett). To age sixty five that amounts (214 x $435) to $93,090. It is my belief that industry conditions will more often be worse rather than better than they are now over the next 12 years (the plaintiff is 51). The impact of any downturns will be severe for the plaintiff. Even allowing for adverse contingencies, $93,000 is not enough. I assess future loss at $125,000.
I turn to non-economic loss. On the 0-60 scale I assess the plaintiff at 23. The multiplier is $1,530, giving a figure of $35,190.
In relation to special damages, it has been agreed that those known total $33,309.65. In addition there are amounts still to be ascertained from the Health Insurance Commission, in respect of, essentially, general practitioner consultations which have been bulk billed, but which must be reimbursed. The defendant admits liability in principle for this amount. I give liberty to apply in the event that the parties cannot agree the appropriate figure.
The plaintiff will continue to incur medical expenses. Medications will continue to cost around $25 per week. He will need to see his general practitioner every 2-3 months for monitoring and to get prescriptions. That averages out to about $5 per week. He benefits from a weekly massage, which costs $40. Thus he will spend around $70 per week for the rest of his life. The multiplier for the rest of the plaintiff’s life is $741. 70 x $741 = $51,870. I shall allow $50,000. In addition it is probable that, within a few years, he will need surgery to his shoulder, the present cost of which is $4,000. To allow for acceleration and uncertainty, I will allow $3,000. He will also require a few more visits to a psychiatrist or psychologist over the next six months. I allow $500. I assess future special damages at $53,500.
I must allow for gratuitous services provided by the plaintiff’s wife. The plaintiffs’ counsel suggested I should allow $12,000, calculated at $20 per hour for five hours per day in the first two months, three hours per day for the next ten months and one hour per day thereafter. I do not doubt that his wife did put in those hours. My only reservation is that the evidence is very sparse and some of that time is for things that she would probably have done for the plaintiff in any event. Not everything done by one spouse for the other attracts an award.
I shall allow $10,000 for past services.
An award for future services at five hours per week is sought for the rest of the plaintiff’s life. That calculates to $74,100. In my view, as time goes on and the plaintiff and his wife get older, it becomes increasingly likely either that the plaintiff would have needed various forms of help, regardless of the accident or that his wife will not be able to give it. In my opinion a simple actuarial calculation produces too high a figure. To age 65, the figure would be $43,500. I shall allow $40,000.
The plaintiff can no longer carry out all the maintenance and development of his house and car. He used to do that. If I allowed $25 per week for the rest of the plaintiff’s life (25 x $741) I would reach $18,525. I think I would be fairer to allow it to about age 65, after which the plaintiff may not have done so much. 20 x $435 = $8,700. I recognise that 65 is an arbitrary age to select. I will allow $10,000.
No allowance is sought for past assistance, which has been given by his sons-in-law.
I summarise:-
Past loss of earning capacity  $ 75,000
         Future loss of earning capacity   125,000
         Past Special Damages
                  (with liberty to apply)   33,309
         Future Special Damages   53,500
         Non economic loss on scale (23)   35,190
         Past gratuitous services   10,000
         Future gratuitous services   40,000
         Future handyman and like services      10,000
  $381,999
I shall hear the parties on interest.
The plaintiff’s wife has her own claim for loss of consortium. I have largely described it already. I allow it in the conventional sum of $11,000.
I shall hear the parties on costs.