Lopez v Lopez

[1997] QCA 226

IN THE COURT OF APPEAL	[1997] QCA 226
SUPREME COURT OF QUEENSLAND
Brisbane	Appeal No. 6913 of 1996
[Lopez v. Lopez]
BETWEEN:

DELPHINE MARY LOPEZ

(Plaintiff) Appellant

AND:

NORMAN JUDE LOPEZ

(Defendant) Respondent

Fitzgerald P. Mackenzie J.

Helman J.

Judgment delivered 01/08/1997
Separate reasons for judgment of each member of the Court; Mackenzie J. and Helman J.
concurring as to the orders made, Fitzgerald P. dissenting in part.

APPEAL ALLOWED WITH COSTS. JUDGMENT FOR PLAINTIFF GIVEN BELOW OF $150,925.68 SET ASIDE AND IN LIEU THEREOF JUDGMENT FOR PLAINTIFF IS ENTERED FOR $184,785.68.

CATCHWORDS:	DAMAGES - Personal Injuries - motor vehicle accident - loss of function of right arm and cervical spine - quantum for past and future economic loss - extent to which applicant's earning capacity would have been utilised - whether residual earning capacity - whether failure to award future Griffith v. Kerkemeyer damages.
Zuvela v. Cosmarnari Concrete Pty Ltd (1996) 71 ALJR 29 Kars v. Kars (1996) 71 ALJR 107 Elford v. FAI General Insurance Co Ltd [1994] 1 Qd R 258
Counsel:	Mr D.B. Fraser QC with him Mr R.W. Trotter for the appellant. Mr W.D.P. Campbell for the respondent.
Solicitors:	Bruce S. Dulley as town agents for Richardson McGhie for the appellant. Heiser Bayly & Mortensen for the respondent.
Hearing date:	12 June 1997

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 6913 of 1996

Brisbane

Before Fitzgerald P. Mackenzie J. Helman J.

[Lopez v. Lopez]

BETWEEN:

DELPHINE MARY LOPEZ

(Plaintiff) Appellant

AND:

NORMAN JUDE LOPEZ

(Defendant) Respondent

REASONS FOR JUDGMENT - FITZGERALD P.

Judgment delivered 1 August 1997

I am in agreement with the judgment of Mackenzie J. except in one respect.

In fixing past economic loss, the Trial Judge found that the appellant theoretically had a residual

earning capacity but that suitable work had effectively been unavailable to her in the period up to

trial. However, in fixing future economic loss, his Honour proceeded on the basis that she would be

able to find work which would enable her to exercise her residual earning capacity.

Although I am conscious of the restrictions upon an appellate court’s interference with findings by a Trial Judge, which was recently reaffirmed in Zuvela v. Cosmarnan Concrete Pty Ltd,[1] the

[1] (1996) 71 A.L.J.R. 29.

arguments of both appellant and respondent focussed upon the inconsistency in the approaches

adopted by the Trial Judge with respect to past and future economic loss. The appellant sought to

have future economic loss decided on the same basis as past economic loss, i.e., by reference to the

appellant’s inability to find suitable employment to enable her to exercise her residual earning

capacity, while the respondent sought to have a reduction in the amount awarded for past economic

loss by reference to the Trial Judge’s implicit assumption that suitable future employment will be

available and hence suitable employment should have been found to be available in the period up to

trial.

In my opinion, the appellant’s approach is to be preferred when regard is had to the express findings

that the appellant “has not found anything that has suited her physical capacities” and “unfortunately

it is difficult for a woman of her age with the undoubted skills which she possesses to obtain regular

and permanent employment for only a couple of hours per day. She has endeavoured to obtain

suitable employment locally but has not been able to do so.”

In the circumstances, including the present high rate of unemployment in this country which seems

certain to continue for the future period of seven years during which his Honour found the appellant

would have exercised her earning capacity had she been able to do so, no other conclusion was

reasonably open than that she would not be able to obtain suitable employment in that period.
Accordingly, in my opinion the appellant’s future economic loss should have been increased by an
amount of $100.00 per week for seven years, or a total of $30,900.00.

In summary, therefore, I would allow the appeal with costs and increase the judgment below to $215,685.68. The respondent should also pay the costs of the trial, including reserved costs, if any.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 6913 of 1996

Brisbane

Before Fitzgerald P Mackenzie J Helman J

[Lopez v. Lopez]

BETWEEN:

DELPHINE MARY LOPEZ

(Plaintiff) Appellant

AND:

NORMAN JUDE LOPEZ

(Defendant) Respondent

REASONS FOR JUDGMENT - MACKENZIE J

Judgment delivered 1 August, 1997

The appellant was injured when a vehicle driven by her husband left the road and collided

with a tree. She received a fracture of the right arm in the vicinity of the shoulder and her left

shoulder was dislocated. She came into contact with the hot exhaust pipe of the motor vehicle

which caused serious burns to her right thigh. She also received numerous cuts to the arms, one of

her breasts and her face. The major enduring physical injury at the time of trial was loss of function

of the right arm and the cervical spine which causes restriction of flexion, extension and rotation and

loss of strength in her right arm. The appellant is naturally left-handed but she has difficulty lifting

heavy objects, such as things in the oven and bags of shopping. She also has difficulty with tasks

which require her arms to be raised above shoulder level, such as hanging out washing, cleaning

windows and shelves and the like. Judgment was entered in her favour in the sum of $150,925.68.

The first two grounds of appeal are concerned with the question of interest on past economic loss and past gratuitous services. By the time of the appeal the parties had reached agreement on those components. Interest agreed to be paid was $13,860. Initially no order was

sought in respect of this sum but later it was pointed out that that sum would become relevant on the

question of costs if it and any adjustment which might be made in other respects increased the

judgment sum to over $200,000, the amount of an offer to settle.

Other grounds of appeal were concerned with past and future economic loss and with the

failure to award future Griffith v. Kerkemeyer damages. The grounds of complaint against the

assessment of economic loss were that the learned Trial Judge had erred in discounting past and

future losses by sixty percent, that he had allowed only seven years for future economic loss and that

he had erred in finding a residual earning capacity of $100 per week in connection with future

economic loss.

The applicant was forty years of age at the time of the accident and forty-eight at the time of

trial. Prior to the accident she had been employed on a part-time casual basis in a clerical/secretarial

position in a surveyor's firm and was well thought of by her supervisor. She would have been

prepared to give the appellant full-time employment if a position became available although at the

time of the accident the plaintiff was deliberately limiting her working hours so that she could be

home when her son (who was then in grade 7) came home from school. She gave evidence that she

would have considered working full time once he was in secondary education.

The learned Trial Judge's findings as to past economic loss were that, but for the accident,

the appellant would have had the capacity to work full time earning $450 per week gross, or

$373.50 per week net. He awarded $38,844.00 for past economic loss, being forty percent

of the total loss of earnings for the five years in respect of which loss was proved. Loss was not

proved for the remainder of the pre-trial period. He described his approach as a "broad brush

approach". In particular, he did not make any specific deduction for residual earning capacity,

which he fixed in connection with future economic loss at $100 per week. On the other side of the

ledger the learned Trial Judge referred to the evidence that the appellant had endeavoured to find a couple of hours work per day which she was capable of doing but had not been able to do so for

that part of the period between the accident and the trial for which loss was claimed.

The following passage in the learned Trial Judge's judgment demonstrates his approach to

the issue of the extent to which the applicant would have exercised her earning capacity both

between the accident and the trial and following the trial:

" I am of the view that had it not been for her injury the plaintiff would almost certainly have had the capacity to work full time as a valued employee earning perhaps $400 to $500 per week gross for 15 years. The extent to which she would have utilised that capacity is uncertain in light of her domestic and parental obligations and interests. Thereafter as the financial demands on the family diminished and as she grew older and wished to enjoy more the rural residential lifestyle which she and her husband have developed for their retirement, I think the likelihood is that she probably would not in any event have engaged in full time work for more than perhaps a couple of days per week.

I am satisfied that the plaintiff is an energetic woman interested in meeting people and dealing with community affairs. She is involved in church activities and organisations."

The natural reading of that passage is that in the early part of the relevant period domestic

and parental obligations and interests made the extent to which she would have exercised her

earning capacity uncertain. After that, those factors and the financial and other demands of raising a

family and providing for the needs of a student child would diminish. In the latter period, as the

appellant grew older and she desired to enjoy the rural lifestyle, including involvement in church and

community affairs, more, the extent to which she would have actually exercised her earning capacity

was also uncertain. Taking these uncertainties into account the learned Trial Judge fixed on an

equivalent of two days full time work per week as an appropriate estimate of how long she would

have worked during both of those periods. Later in his reasons he found that she would have done

so until age fifty-five (seven years from trial) and that after fifty-five her motivation to work for

income would be so reduced by her circumstances in life that she would not have earned any greater

income than is within her present capacity.

Mr Fraser submitted on the appellant's behalf that the learned Trial Judge's approach was
flawed because it paid insufficient regard to her evidence of her intention to return to full-time work

when she did not need to be at home when her son came home from school and to evidence of her

financial position. The learned Trial Judge had referred to a defence submission that a factor in her

lack of motivation to work was "the not insubstantial financial position that she and her husband

occupy" and said that there was "some merit" in the contention. In connection with the latter, there

was evidence that the plaintiff's husband had, on his return from lucrative employment in Hong

Kong, commenced business as a marine surveyor in which he grossed between $50,000 and

$60,000 per annum. She and her husband had three rental properties, negatively geared at a loss of

$2000 per month. By the time of trial one of these was occupied, effectively rent free, by the

appellant's student son.

In support of his attack on the learned Trial Judge's findings, Mr Fraser relied on evidence

of the loss on the rental properties and on the appellant's evidence that she and her husband were

struggling financially. To meet the proposition that the learned Trial Judge may have properly

inferred that she and her husband were in a substantial financial position, having regard to the

ordinary principles of negative gearing and the absence of any evidence to suggest that they were not

applicable in the present case, Mr Fraser submitted that if the defence had wished to prove the

appellant was in a substantial financial position the onus was on the defendant to show that that was

the case and that for that reason the appellant would not have exercised her earning capacity, rather

than on the appellant to rebut any such inference. There was other evidence of tax minimisation

measures in the form of not insignificant payments to the applicant for slight services to her husband's

business. With respect to the criticism of the allowance of $100 per week as future residual earning

capacity, there was evidence that the appellant devoted a substantial amount of time to church

activities on a voluntary basis. Just before trial, she had been asked and had begun to perform

remunerative work in a parish office. She said in her evidence that it was a casual job and that she

was not sure how long it would last or whether someone else would be employed. She expected to be paid around $12 per hour and, while the evidence is not as clear as it might be, to work 6 or

perhaps 9 hours per week. While the evidence justified a finding that she had been unable to find

employment up to trial, there was evidence that, for the future, she had the prospect of obtaining

work of the kind she had just obtained prior to trial.

In my opinion the findings of the learned Trial Judge upon which his assessment of the extent

of past and future economic loss were based were open on the evidence. It was also argued that

the learned Trial Judge had failed to give adequate weight to the possibility that the appellant may

have exercised her earning capacity to a greater degree than the learned Trial Judge found. There is

nothing to indicate in the judgment that the learned Trial Judge did not take this and the possibility

that she may have exercised her earning capacity to a lesser degree into account in forming his

conclusion that there should be a discount of sixty percent. Ordinarily, such factors would be

considered during the process of deciding what to award. There is no reason to suppose they were

not taken into account.

In relation to past economic loss Mr Campbell for the respondent submitted that the

component for past economic loss was too high because the learned Trial Judge should have made

allowance for the residual earning capacity of $100 per week and failure to do so resulted in an

error in favour of the applicant of $26,000 in this component. The learned Trial Judge's finding in

the following passage, which was not challenged by the respondent, is the answer to that submission:

" Since her return from Hong Kong, she has applied for a few jobs but has not found anything that has suited her physical capacities . . .

She is able to work for a couple of hours per day, but unfortunately it is difficult for a woman of her age with the undoubted skills which she possesses to obtain regular and permanent employment for only a couple of hours per day. She has endeavoured to obtain suitable employment locally but has not been able to do so."

The evidence established that a deduction was not appropriate, because with her diminished

physical capacity she could not obtain a job during that period.

The remaining issue is future Griffith v. Kerkemeyer damages. The learned Trial Judge did

not award anything for this component. He awarded $4430 for past Griffith v. Kerkemeyer

damages but concluded:

"I am unpersuaded that she will need similar assistance in the future, at least of a

kind or to such an extent as to justify an award for services in the future."

The difficulty with this finding is that there is evidence that the plaintiff has difficulty in

performing some tasks for which she is required to seek the assistance of her husband. There was

also a finding that it is a "very real possibility" that she will need an operation in about ten years time

to relieve pain in her shoulder, after which she will be incapacitated for six to eight weeks. The need

for the operation will be prompted by a worsening in her condition leading to the pain becoming so

unbearable that a joint replacement is the appropriate remedy. The learned Trial Judge awarded

half the present cost of the operation for the "not improbable future loss".

With respect to assistance given by her husband in respect of ordinary household tasks Mr

Campbell relied on his cross-examination at the trial to demonstrate that the amount of time involved

in individual tasks was minimal. He submitted to the learned Trial Judge that one half to one hour

per week would be sufficient allowance. Mr Fraser relied on evidence from Mrs Coles that services

of four to six hours per week were necessary. The appellant's counsel had submitted at trial that

$50 per week for thirty years was appropriate. The fact that gratuitous services are provided by a

tortfeasor is irrelevant in determining whether to award a Griffith v. Kerkemeyer component. It is

the need for services created by the negligent act of the tortfeasor for which the plaintiff is

compensated (Kars v. Kars (1996) 71 ALJR 107). In my opinion it was erroneous not to attempt

to quantify Griffith v. Kerkemeyer damages on the state of the evidence. The appellant has a need

for some services, although only to a limited extent, at present. The most likely course of events

according to the evidence is that the need for services will increase as time passes with a substantial

possibility that the applicant will need the operation in about ten years time. If that occurs she will need an increased level of services for a relatively short time after it while she recuperates. If the

result of the operation is as predicted the pain will settle after a few weeks and the need for services,

so far as it is attributable to the accident, will return to about its present level. The fact that the need

will vary in a manner which is not easily calculable makes it appropriate to award a global sum

which, as far as possible, takes into account the various factors. In my view an award of $20,000

for future Griffith v. Kerkemeyer is an appropriate sum.

The question of interference with the costs order below does not arise because the variation

in this regard and the interest component agreed upon do not increase the judgment sum beyond the

amount of the offer to settle of $200,000. Adding interest of $13,860 and a Griffith v. Kerkemeyer

component of $20,000 to the original judgment results in a judgment sum of $184,785.68. The

order for costs below remains unaffected. A variation of the judgment sum by that amount is a

sufficiently substantial variation to require the judgment below to be set aside (Elford v. FAI General

Insurance Co Ltd [1994] 1 Qd R 258). The orders on the appeal are the following:

The appeal is allowed with costs. Judgment for the plaintiff below for $150,925.68

is set aside and in lieu thereof judgment is entered for the plaintiff for $184,785.68.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 6913 of 1996

Brisbane

Before Fitzgerald P. Mackenzie J. Helman J.

[Lopez v. Lopez]

BETWEEN:

DELPHINE MARY LOPEZ

(Plaintiff) Appellant

AND:

NORMAN JUDE LOPEZ

(Defendant) Respondent

REASONS FOR JUDGMENT - HELMAN J.

Judgment delivered 1 August 1997

I agree with the orders proposed by Mackenzie J. and with his reasons.