Malcolm Ecob and Marilyn Ecob t/as Black Swan Coffee Lounge v Deborah Wentworth-Shields
[2002] ACTCA 2
MALCOLM ECOB AND MARILYN ECOB t/as BLACK SWAN COFFEE LOUNGE v DEBORAH WENTWORTH-SHIELDS [2002] ACTCA 2 (18 April 2002)
CATCHWORDS
DAMAGES – appeal against amount awarded for a loss of earning capacity – award based on reduced capacity to work in existing business, delay in planned expansion and reduced capacity for alternative forms of employment – damages a matter of judgment rather than calculation – global approach upheld.
DAMAGES – assessment of global sum for future medical expenses likely to be incurred throughout balance of life – no error of principle – appeal dismissed.
Husher v Husher (1999) 197 CLR 138
Batt v Wilkinson [1983] 2 QD R 619
Spargo v Haden Engineering Pty Ltd (1993) 60 SASR 39
Berenson v Kelly (unreported, Supreme Court of the ACT, Miles CJ, Crispin and Ryan JJ, 17 February 1998)
Gamser v Nominal Defendant (1977) 136 CLR 145
CSR Readimix (Australia) Pty Ltd v Payne [1998] 2 VR 505
Redden v Forde (unreported, Supreme Court of the ACT, Miles CJ, Crispin and Ryan JJ, 27 May 1998)
ACT v Badcock (2000) 169 ALR 585
Wilson v Peisley (1975) 50 ALJR 207
Lunz, Assessment of Damages for Personal Injury & Death, 4th ed
APPEAL FROM THE MASTER
No. ACTCA 3 of 2001
No. SCA 60 of 2001
Judge: Miles CJ, Crispin P and Gray J
Court of Appeal of the ACT
Date: 18 April 2002
IN THE SUPREME COURT OF THE )
No ACTCA 3 of 2001
) No. SCA 60 of 2001
AUSTRALIAN CAPITAL TERRITORY )
BETWEEN:MALCOM ECOB AND MARILYN ECOB t/as BLACK SWAN COFFEE LOUNGE
Appellants
AND:DEBORAH WENTWORTH-SHIELDS
Respondent
ORDER
Judges: Miles CJ, Crispin P and Gray J
Date: 18 April 2002
Place: Canberra
THE COURT ORDERS THAT:
the appeal be dismissed;
the appellants pay the respondent’s costs of the appeal.
IN THE SUPREME COURT OF THE )
No. ACTCA 3 of 2001
) No. SCA 60 of 2001
AUSTRALIAN CAPITAL TERRITORY )
BETWEEN:MALCOM ECOB AND MARILYN ECOB t/as BLACK SWAN COFFEE LOUNGE
Appellants
AND:DEBORAH WENTWORTH-SHIELDS
Respondent
Judges: Miles CJ, Crispin P and Gray J
Date: 18 April 2002
Place: Canberra
REASONS FOR JUDGMENT
MILES CJ
I have read in draft form a copy of the judgment of Crispin P and Gray J and gratefully adopt their Honours’ summary of the facts and of the Master’s judgment. However I differ in my conclusion about the correctness of the Master’s approach to the assessment of the present value of the respondent’s future loss of earning capacity. In my view, that approach has resulted in an excessive award of damages.
I agree that it was appropriate to regard the assessment as requiring the award of damages for future loss of earning capacity to include some sort of “buffer” against a possible loss which fell short of a probability. As I understand it, the term “buffer” has been used sometimes in recent years to describe a component in the injured plaintiff’s damages which is awarded in order to compensate the plaintiff for economic loss which has not yet occurred and is not likely to occur, but which emerges as a real possibility in foreseeable circumstances established by the evidence. For instance, a person in steady employment who sustains a permanent physical disability, which in no way affects his or her capacity to continue in that employment, may not be able to show, on the probabilities, any past or present loss of earnings, nor any future loss of earnings except in the event of possible but unlikely circumstances which themselves have essentially nothing to do with the physical disability. In that event, the award may contain a component to compensate the person against the unlikely eventuality. The quantum of the component will depend, inter alia, upon the incidence of possibility. In the case of a “self-employed” person, or a person whose earnings derive from carrying on business, it may be very difficult to estimate whether the incidence of possibility is relatively high or low.
Cases of this nature appear in the reports and are discussed in some of the texts, for example, Lunz: Assessment of Damages for Personal Injury and Death, 4th ed at 236. By way of an example, which I am sure is not original, one may consider a plaintiff in good health who loses the sight of an eye through the fault of the defendant and who has suffered no consequent loss of earnings at all and who is not likely to do so. It may be accepted that the plaintiff has suffered loss of earning capacity in the sense that the plaintiff is at risk of substantial loss of actual earnings in the future in the unlikely event of going blind in the other eye due to nothing on the defendant’s part.
Where the evidence is sufficiently clear to establish that a continuing diminution of capacity to earn income is likely to result in actual future loss of income (for instance, by way of non-receipt of wages or salary which, but for the incapacity, the plaintiff would have received) a mathematical approach is appropriate. The particular mathematical formula which is usually preferred is by way of the application of a “discount” rate to a determined regular loss over a determined period, where the evidence permits the determination to be made as matters of probability. The determination is not necessarily easy and the quantification of the regular loss or the period over which it is yet to be sustained, or both of those factors, may have to be made more by way of estimate than by mathematical calculation.
However, the mathematical approach of applying a “discount” rate to a likely future regular loss over a likely future period is, in my view, inappropriate to apply to a case like the present, where the evidence does not establish, as a matter of probability, any future regular loss. In such cases the appropriate approach is to provide a “buffer” against only possible future loss which may yet occur in foreseeable circumstances which are not shown to be probable.
Nevertheless, the method of applying a “discount” rate to hypothetical future circumstances may be a proper means of searching for or checking an approximate figure which may be used as a provisional estimate of the present value of the impairment of the plaintiff’s income earning capacity as it has been brought about by the defendant’s wrong doing. The hypothetical circumstances themselves however must be within the bounds allowed for by the evidence. The figure calculated by this method, using hypothetical circumstances, should not be treated as deriving force or validity because it is the result of the application of a mathematical formula. The figure should be checked by the application of sound discretionary judgment to the whole of the relevant circumstances. The extent to which the hypotheses or any of them are realistic must also be addressed. Overall it must be borne in mind that the plaintiff bears the onus on damages as well as on liability. It necessarily follows, in my view, that if part of the assessment of damages relies on reference to hypotheses and possibilities rather than probabilities established on the evidence, caution is appropriate. Thus an award of damages as a buffer against possible actual loss of wages or salary in the future is bound to be modest.
In the present case the respondent’s physical limitations caused by the injury had not led to any past loss of earnings or loss of income of any sort at the time of the trial. In relation to the sum selected to compensate the respondent for economic loss, $78,000, the Master observed that this figure is “the equivalent of the present value of an ongoing loss of $100 per week for 25 years from the date of the accident.” The observation appears to be correct as a matter of arithmetic according to the table in Lunz at 544, applying a discount rate of 3 per cent and assuming that the Master deducted a further 15 per cent for the conventional contingencies. However, it is not clear why the Master referred to a period commencing at “the date of the accident.” The only explanation, as I see it, is that the figure is intended to compensate the respondent for both past and future loss of earning capacity. Yet the value of that loss in the past was insignificant, because the respondent, on the evidence, had never foregone any wages, salary or other form of income. All that had been established was that if she had not been injured she might have earned, after the date of the injury, more than she in fact earned after that date. That does not appear to me to be a proper basis on which to award damages. If it involved the loss of a chance, the chance is not shown to have any monetary value.
Furthermore, the application of the tables to past as well as future loss is at least unusual, and, as far as I am aware, unprecedented. In the absence of explanation, the use of the tables to support an assessment of past and future loss combined was not appropriate.
Furthermore again, apart from there being no actual loss of earnings in the past, there was no real possibility, let alone likelihood, of any loss in the immediate future. The reference point of a 25 year period of hypothetical actual loss was equivalent, in the case of a 41 year old woman, to a calculation based on a continuous loss for the whole of her remaining working life. That, in my view, is suggestive of over-compensation.
Finally, there was nothing in the evidence to point to the selection of $100 per week as the regular loss likely to be experienced during the 25 year period. Whilst in itself the selection of that figure for hypothetical purposes may not be indicative of error, the combination of these hypotheses should have led the Master to review carefully the resultant figure.
$78,000 is, in my view, on the face of it, a high award for economic loss to a plaintiff who has suffered no economic loss to the date of the trial, who is not likely to suffer any such loss in the future, whose relevant disabilities are limited to fluctuating low back pain which would vary with her activities and whose earnings were never likely to be derived other than from carrying on business in the restaurant trade. The apparent generosity of the award should have put the Master on notice that the selection of that figure could not be justified on the findings on the evidence or on the reasoning that had been applied, and the figure should have been revised downwards to reflect those matters.
The award of a buffer against possible future loss of earnings is not to be confused with a “global” or “intuitive” approach to the award of damages. As CSR Readymix (Australia) Pty Ltd v Payne [1998] 2 VR 505 makes clear, a “global” assessment suffers from the vice that either it does not expose the reasoning process behind it, or the components that go to make it up, or both. In this sense such an assessment is said to be “intuitive”. However, when Stephen J said in Gamser v The Nominal Defendant (1976 - 1977) 136 CLR 145 at 149 that an award of damages “is not common, nor should it ever be arrived at intuitively”, the reference is, as the succeeding sentences suggest, to the whole of the award. I do not take his Honour to have been referring to each of the component figures of an award. In an action for personal injuries, the component for past out-of-pocket expenses, when contested, should normally be broken up into medical expenses, hospital expenses, medication and the like. On the contrary, the component for pain and suffering and loss of enjoyment of life, these days usually referred to as “general” damages, is not divided into so much for a headache, so much for restriction of movement in the spine and the like. In this respect the component for pain and suffering and loss of enjoyment of life is often said to consist of “imponderables”. The selection of an appropriate figure to represent the value of that component may truly be said to be intuitive, so long as one recognises that intuition in this context does not occur in a mind devoid of relevant information deriving from common experience, cultural values and the like (including awards in similar cases). In this context also, intuition resembles other well-recognised concepts in the law such as “reasonableness” and “common sense” which defy explanation or definition. In my view, the Master’s award for future loss of earning capacity is not liable to criticism because it was made on a “global” basis, but because, in my respectful view, the method of selecting or reaching the figure of $78,000, which should be seen intuitively as a generous figure, is shown to be flawed.
In contrast, the award for future out-of-pocket expenses, although described by the Master as a “buffer”, did not go to compensate the respondent for the possibility that her injuries and disabilities might in the future put her at risk of consequent medical, pharmaceutical and similar expenses. There was no dispute that she had in fact incurred such expenses in the past (for which she was awarded $5,362) and she was likely to incur at least some expenses of similar nature in the future, although, of course it was very difficult, if not impossible, to predict how regularly she would incur such expenses and how much she would incur from time to time. The Master’s reasoning was brief. He said at [44]:
“…There is a need for ongoing analgesia, and there may be a need for specialist consultation from time to time. Physiotherapy or home exercise may be appropriate. The disc injury will cause intermittent problems on a lifelong basis, so a buffer must cover a long period. I award the sum of $20,000 as a buffer for future medical costs.”
I would not have described this component as a “buffer”. But because of the lack of any authority on the matter I would not interfere with the award for the simple reason of misdescription. If there is any room for criticism, it is because of a “global” approach and lack of particularity. But, as Crispin P and Gray J observe, the Master found that the respondent at 41 years of age was likely to incur expenses of this nature for the rest of her life. Their Honours consider that the amount of $20,000 for future out-of-pocket expenses did not fall outside the range of discretion reasonably available. I would say, adopting the aforesaid method of checking the figure by hypotheses available on the evidence, that $20,000 is the approximate present value of about $20 per week expended over the respondent’s expected life span, discounted by an investment rate of 3 per cent per annum and further reduced by 15 per cent for contingencies. In contrast to the award for economic loss, that approach, although by no means conclusive, tends to confirm that the award for future out-of-pocket expenses is within proper range and I would not interfere with it.
However, it follows from what I have said previously that the selected figure of $78,000 for loss of earning capacity should have been heavily discounted having regard to the low incidence of possibility, or the period of loss reduced by a similar proportion, or a combination of those methods, with or without a reduction in the assumed amount of the continuing regular financial loss. In the end there needed to be a “common sense” or, if you like, “intuitive” appraisal of the end figure. Had that been done it would, in my view, have resulted in a reduction to about half of what was awarded for financial loss. Bearing in mind, as always, that even reasonable minds using a correct approach may differ in the result, I think that, for the purposes of the appeal, the award for future loss should be reduced to $50,000. Viewed as a lump sum in the light of the level of awards in this and other courts, I regard that as being at the upper limit of the permissible range established on the evidence. The total damages should therefore be reduced by $28,000.
I would allow the appeal, set aside the Master’s judgment and in lieu thereof order that judgment be entered in favour of the respondent in the sum of $130,467. Unless the parties wish to be heard I would order that the costs of the appeal be paid by the respondent.
I certify that the preceding sixteen (16) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Chief Justice Miles.
Associate:
Date: 18 April 2002
IN THE SUPREME COURT OF THE )
No. ACTCA 3 of 2001
) No. SCA 60 of 2001
AUSTRALIAN CAPITAL TERRITORY )
BETWEEN:MALCOM ECOB AND MARILYN ECOB t/as BLACK SWAN COFFEE LOUNGE
Appellants
AND:DEBORAH WENTWORTH-SHIELDS
Respondent
Judge: Miles CJ, Crispin P and Gray J
Date: 18 April 2002
Place: Canberra
REASONS FOR JUDGMENT
CRISPIN P and GRAY J
This is an appeal against a decision of the Master awarding the respondent damages for personal injuries sustained as a result of an accident on 3 December 1999 when she was struck by an umbrella blown from the outdoor portion of the appellants’ premises.
The Master found the appellants negligent in failing to ensure that the umbrella was properly secured and hence liable to the respondent for the injuries so inflicted. These findings were not challenged on appeal but Mr Williams QC, who appeared for the appellants, submitted that the damages awarded had been excessive.
The respondent was struck by the umbrella in the back in the region of the left shoulder blade and was pushed forwards by the force of the impact. She tried to prevent her fall by grabbing one of the umbrellas in the adjoining café in which she was working, but nonetheless fell, suffering bruising to her face and hand. She was taken to hospital but not given an x-ray, apparently because of some problem with the machine. She was discharged with advice to see her general practitioner. She acted in accordance with this advice but it was initially presumed that she had suffered only soft tissue injuries. However, she was subsequently referred for a CT scan which revealed the presence of a disk bulge at the L3/4 level of the spine. It was common ground that the bulge was attributable to the accident and that it had caused nerve impingement.
The CT scan also revealed less significant disk bulging at two other levels and there was evidence that the respondent had previously made complaints of low back pain and had undertaken spinal manipulation in the L3 to L5 area. In the light of this evidence, the defendant argued that the accident may have merely aggravated a previously degenerative disc. However, an x-ray of the lumbar spine in 1991 had revealed no degenerative changes and there had been no history of treatment for the lumbar spine or complaints of low back pain during the years immediately prior to the accident.
The Master found that the respondent had had some degree of pre-existing spinal degeneration but no ongoing symptoms. He was satisfied that the accident had caused a “frank disc injury” consisting of the disc bulge at the L3/4 level which had led to a degree of nerve impingement. He was also satisfied that the disc bulge had caused ongoing pain and discomfort of varying intensity. These findings were not challenged on appeal.
The Master found that the respondent continued to work about forty to fifty-five hours per week in the café and noted that she had acknowledged being in attendance for even longer periods. He found that the injury had restricted her ability to carry out some of her duties and that she no longer carried out the tables, chairs and umbrellas at the start of the day or brought them in at closing time. On the other hand, she was able to drive and otherwise engage in normal daily activities. He was satisfied on the medical evidence that the disc injury would “continue to generate fluctuating low back pain which [would] vary with her activities”. He accepted that the injury was unlikely to require surgery but that it was also “unlikely to resolve and [would] generate ongoing problems”. He found that there would be a continuing need for the plaintiff to be “guarded” in her activities, both in work and in leisure.
He awarded her the sum of $55,000 for general damages, noted that $25,000 of that sum had been attributable to the period prior to trial and awarded interest amounting to $795 on that component. There was no challenge to this assessment of general damages and interest.
The respondent and her husband operated several businesses, including that of the adjoining café, and her claim for damages relating to loss of earning capacity had involved a contention that she had been required to employ additional staff to carry out the duties that she would have undertaken had she not suffered the injuries. Whilst it is clear that the respondent and her husband conducted their business interests including the café through a family trust, that fact alone would not have prevented her from recovering damages on this basis. As the High Court observed in Husher v Husher (1999) 197 CLR 138, an injured plaintiff is entitled to recover damages for diminution in earning capacity based upon the loss of the income that he or she would have expected to have had under his or her control or at his or her disposal by exercising that capacity. Hence, it has been held that an injured plaintiff may recover the cost of replacing his or her labour in a partnership business: Batt v Wilkinson [1983] 2 QD R 619 at 622. Similarly, damages may be assessed by reference to the total income produced by the injured plaintiff’s exertions even if distributed by means of a trust to other family members: Spargo v Haden Engineering Pty Ltd (1993) 60 SASR 39 at 53. The same principle has also been applied when income produced from an injured plaintiffs activities have been diverted to a company and ultimately shared by others: Berenson v Kelly (unreported, Supreme Court of the ACT, Miles CJ, Crispin and Ryan JJ, 17 February 1998). In the present case, however, the Master found that the claims particularised had not been substantiated by the evidence. Indeed, he observed that in the time since the accident direct labour costs incurred in the business had been reduced.
The taxable income that the respondent received from the family trust was obviously not based upon the extent of her personal exertions. In addition to the monetary income that the respondent and her husband received, the trust provided them with rental accommodation in Canberra, paid for the expenses associated with the respondent’s BMW motor vehicle and her husband’s Jaguar motor vehicle, paid various credit card accounts and paid the educational expenses for their son at an exclusive private school. It was conceded that there was nothing either illegal or improper in these arrangements but, as the Master observed, they gave rise to difficulties in the determination of the plaintiff’s economic loss.
Nonetheless, the Master accepted that the respondent’s injury had had an impact on her earning capacity and accepted her counsel’s submission that the matter should be approached by determining an appropriate “buffer”. The Master then proceeded to make the following findings:
I am satisfied that the plaintiff is, due to her back pain, restricted in the nature of her duties and in her hours of work, in that she is no longer able to undertake heavy lifting, and that she no longer works the 80 hours that she was working when she first set up the restaurant. Despite this, all financial indicators show that the business is improving. Her evidence was that it was her hope to open further restaurants before the accident, and that the normal pattern of trading in this type of business is that it takes a few years for a business to recoup set up costs and move fully into profit. The expected pattern would be for a diminishing overall loss for some years before long term profit. If I accept this as evidence of the normal course of business in the restaurant trade, it seems that, despite the accident, the Zest Café is moving in line with the expected trend, with a significantly improved trading profit, and a significantly reduced overall loss.
There is no real evidence to assist me in reaching any precise view on whether, but for the accident, the movement to profit may have been greater, and if so the quantity of this loss.
The plaintiff presented as a confident and capable businesswoman who has persisted with this venture, working long hours despite her back injury, and on all of the financial information before me, with apparent success. I accept, however, that there have been limitations on her activity, and that these do sound in damages.
I accept her evidence that the front disc injury has led her to put on hold her plans for expansion, although these have not been abandoned. I accept that she is limited now to a managerial role (which on the accounts has been successful), and that she would not be able to approach a new restaurant set up with the physical vigour with which she approached the set up of Zest. I accept that she would be limited in the type of work that she could engage in if she was not a self employed restaurateur, and that this also must sound in damages.
Bearing in mind the limitations of a buffer approach to economic loss, I award the sum of $78,000, inclusive of interest for past and future loss, which is the equivalent of the present value of an ongoing loss of $100 a week for 25 years from the date of the accident, which I consider to be appropriate in all of the circumstances of this case.
Mr Williams argued that the Master had fallen into error by adopting this approach. He submitted that no economic loss had been demonstrated because it had not been shown that the plaintiff’s physical limitations had brought about any actual loss of income. In the alternative, he submitted that the Master had failed to give adequate reasons for the assessment or to even identify the evidence upon which it was based. He maintained that the sum awarded did not appear to have been determined by any adequate process of reasoning based upon the evidence in the case and could only have been arrived at intuitively. The formulation of $100 per week for twenty-five years to which the sum was said to be “equivalent” was not a realistic guide to the true measure of damages because there was no evidence to establish either that a loss of that amount per week had been suffered or that it would be sustained for such a period. Furthermore, there was no indication as to what allowance had been made, if any, for the vicissitudes of life that should properly have been taken into account.
Mr Williams relied upon the statement of Stephen J in Gamser v Nominal Defendant (1977) 136 CLR 145 at 149:
. . . [S]o long as awards of damages for personal injuries are to be assessed at first instance by judges rather than juries, with the accompanying advantage of the existence of stated reasons, those reasons should condescend to some degree of particularity concerning the process by which the particular award of damages has been arrived at. . . . An award of damages is not, nor should it ever be, arrived at intuitively. Only if it were would particularity as to its component parts be otiose; and if an award is to be the result of a process of reasoning, often quite complex, that process should be exposed, both to the satisfaction of the parties and for the enlightenment of appellate courts should there be an appeal.
These remarks were quoted with approval by the Victorian Court of Appeal in CSR Readimix (Australia) Pty Ltd v Payne [1998] 2 VR 505 at 508. In that case the trial judge had eschewed a mathematical approach to the assessment of damages in favour of what he described as a “more global approach” and indicated that he preferred “to proceed by selecting a sum that seems to . . . reflect the magnitude of the plaintiff’s loss”. Winneke P, with whom Hayne and Batt JJ agreed, said that such reasoning seemed to be consistent only with the conclusion that the trial judge had adopted an intuitive approach and that having regard to the paucity of findings it had been impossible to discern what view had been taken as to the impact, if any, that the accident had had upon the plaintiff’s productive capacity at the date of the trial. Accordingly, judgment was set aside and a new trial ordered on the question of damages. For present purposes it is unnecessary to analyse the facts of this case because the present case is markedly different.
It is clear from the terms of the Master’s judgment, which we have quoted, that the Master had concluded that the respondent’s economic capacity had been affected in three ways. First, her activities in the conduct of the existing café business had been limited. Second, it had been necessary for her to “put on hold” her plans to expand her business ventures by establishing one or, perhaps ultimately, even two further cafés. Third, her capacity to engage in alternate income activities had also been limited. Each of these findings had been clearly open to him.
It is true that the evidence did not permit the Master to make a precise calculation as to the quantum of loss so sustained. However, a court is not relieved from the duty of assessing damages merely because they are not amenable to precise calculation or because the task is otherwise fraught with difficulty: see, for example, Redden v Forde (unreported, Supreme Court of the ACT, Miles CJ, Crispin and Ryan JJ, 27 May 1998) and Lunz, Assessment of Damages for Personal Injury & Death, (4th edition), p 121. Whilst, as Stephen J pointed out in Gamser, a Court should not forsake a sound reasoning process for a purely intuitive approach, a judge may sometimes encounter situations in which he or she may feel that there is little more than intuition to rely upon. When the evidence does not permit the magnitude of the plaintiff’s loss to be determined with certainty, the judge or master must do the best he or she can to assess damages on the limited evidence available. That seems to have been what the Master was required to do in the present case.
The fact that the respondent was restricted as to the nature of the duties she could perform and unable to sustain the working hours she had maintained prior to the accident could obviously have been expected to have had some impact upon the profitability of her business endeavours and hence, ultimately, upon her income. It is true that an examination of the relevant books of account of the business she was presently conducting did not provide any basis upon which any such loss might have been quantified, but the Master was obviously entitled to infer that substantial loss attributable to her injuries could be substained in respect of possible enterprises that the plaintiff might undertake in the future.
There was obviously no way in which the Master could have been expected to have made a precise calculation of the profits that might have been lost by putting on hold the plans to establish a further café or cafés. Such a business may have failed and, as the Master noted, even the pattern expected of such a business would have been for a diminishing overall loss for some years before long term profit could have been anticipated. However the respondent had plainly been successful in establishing at least one such venture and was entitled to damages for the loss of the chance to establish a further venture or ventures at the times when she would have attempted to do so had it not been for the injuries she sustained.
We think that the Master was correct in his view that the limitations imposed upon the respondent’s capacity to engage in other work if she were not a self employed restaurateur should also have sounded in damages. Mr Williams submitted that the Master should have taken the view that it was highly unlikely that the respondent would have worked as a waitress even if the restaurant business had failed. However it should be noted that the café was not the only business which she and her husband operated, and it was appropriate for the Master to have made at least some allowance for the possibility that her earning capacity would have been restricted by her physical limitations.
It is true that the Master provided only a limited explanation of the difficulties inherent in assessing the level of damages that might have provided the respondent with fair compensation for these losses. However, he was clearly required to do the best he could in circumstances in which ascertainment of the precise loss of damages was impossible, and he made a general assessment only after making findings as to the nature and extent of the plaintiffs’ incapacity and its impact upon her ability to work in the business, and after identifying the losses or potential losses for which damages were to be awarded. We do not accept that it was incumbent upon the Master to embark upon a detailed discussion of the uncertainties associated with each of the situations he was obliged to consider or that there was any sensible basis upon which he could have determined some notional quantum of loss and discounted it by reference to the vicissitudes of life.
We accept that opinions might differ as to the amount that should have been allowed in the circumstances identified by the Master. However, he was obliged to make a judgment as to the appropriate level of damages and we are unable to discern any error in his assessment. It is true that an appeal from a decision of the Master is by way of re-hearing and we are conscious of the need for an appellate court to decide issues of both fact and law for itself when issues of credibility are not involved: see ACT v Badcock (2000) 169 ALR 585. However, that does not mean that the approach taken by the Master is not entitled to due consideration and respect. Indeed, in ACT v Badcock, Einfeld J, at 590, cited earlier decisions recognising that “full weight” should be given to the decision appealed from and affirming that an appellate court should give effect to its own judgment only if it considers that decision to be wrong. Furthermore, in Wilson v Peisley (1975) 50 ALJR 207 at 214 Mason J referred to observations of Lord Wright in Davies v Powell Duffryn Associated Collieries Ltd [1942] AC 601 at 615 and stated that “in the case of an award of damages for personal injury by a trial judge, although the appeal is by way of re-hearing . . . , [because] the assessment of damages is ‘more like an exercise of discretion than an ordinary active decision’, an appellate court is particularly slow to reverse the primary judge”. See also McTiernan J at 211 and Gibbs J at 21. Barwick CJ added, at 209, that “the less ponderable the elements of damages under consideration, the less likely will there be a case for setting aside the award” unless, of course, it was based upon some error. In the present case, the appellants have not shown that the approach taken by the Master involved any error of fact or law, or that it was unreasonable in the light of his findings concerning the respondent’s disabilities.
It is also true that there was no basis for concluding that the respondent had lost the sum of $100 a week for a period of twenty-five years from the date of the accident, but we do not accept that the sum of $78,000 was calculated in that manner. The nature of the losses identified by the Master would clearly have been incompatible with such an approach. For example, he clearly identified the fact that her plans for an expansion for the business had not been abandoned but only put on hold, which obviously meant that the loss sustained in this manner would not have been a constant amount over such an extended period. Furthermore, if he had intended to assess damages on such a basis he would have been obliged to allow interest on that portion of the loss that would have been sustained prior to the date of trial and to discount the component for the future both by reference to the 3 per cent tables and by some further sum to allow for the contingencies of life. In adverting to the equivalent value of the loss in weekly terms we think that the Master was merely intending to provide some further means by which the appropriateness of the global amount awarded might be checked or tested.
More appropriate bases for comparison could have been suggested. However, the decisive question is not whether the Master chose the best means of demonstrating the reasonableness of his assessment but whether the appellants have demonstrated that in awarding that amount he fell into error. In our opinion, they have not done so.
Mr Williams also attacked the amount awarded for future medical expenses. It should be noted, however, that the plaintiff was only forty-one years of age at the date of trial and that the Master was obliged to determine an amount that would fairly compensate her for the expenses which were likely to be incurred throughout the balance of her life. Such an exercise was again necessarily attended by considerable uncertainty and, whilst we have carefully considered Mr Williams’ submissions, we are not satisfied that the amount awarded fell outside the range of discretion reasonably available to the Master.
For these reasons the appeal must be dismissed with costs.
I certify that the preceding paragraphs numbered seventeen (17) to forty (40) are a true copy of the Reasons for Judgment herein of their Honours Crispin P and Gray J.
Associate:
Date: 18 April 2002
Counsel for the appellants: Mr R E Williams QC
Solicitor for the appellants: Hunt & Hunt
Counsel for the respondent: Mr G Lunney
Solicitor for the respondent: Higgins Solicitors
Date of hearing: 3 December 2001
Date of judgment: 18 April 2002
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