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Malec v JC Hutton Pty Ltd

Malec v JC Hutton Pty Ltd

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HIGH COURT OF AUSTRALIA

Brennan, Deane, Dawson, Gaudron and McHugh JJ.

MALEC v. J.C. HUTTON PTY LTD

(1990) 169 CLR 638

29 May 1990

Damages

Damages—Assessment—Tort—Personal injuries—Pain and suffering—Future or potential events—Likelihood of occurrence—Relevance to measure of damages.

Decisions

BRENNAN AND DAWSON JJ. We are in agreement with the judgment of Deane, Gaudron and McHugh JJ. and with the order that they propose, subject to some brief observations. The judgment of the majority in the Full Court seems to us to overlook the difference between the fact that the plaintiff had not been working for some time before the trial and an evaluation of the plaintiff's earning capacity which was destroyed in consequence of the defendant's negligence. The fact that the plaintiff did not work is a matter of history, and facts of that kind are ascertained for the purposes of civil litigation on the balance of probabilities: if the court attains the required degree of satisfaction as to the occurrence of an historical fact, that fact is accepted as having occurred. By contrast, earning capacity can be assessed only upon the hypothesis that the plaintiff had not been tortiously injured: what would he have been able to earn if he had not been tortiously injured? To answer that question, the court must speculate to some extent. As the hypothesis is false - for the plaintiff has been injured - the ascertainment of earning capacity involves an evaluation of possibilities, not establishing a fact as a matter of history. Hypothetical situations of the past are analogous to future possibilities: in one case the court must form an estimate of the likelihood that the hypothetical situation would have occurred, in the other the court must form an estimate of the likelihood that the possibility will occur. Both are to be distinguished from events which are alleged to have actually occurred in the past. Lord Diplock said in Mallett v. McMonagle (1970) AC 166, at p 176:

"The role of the court in making an assessment of damages which depends upon its view as to what will be and what would have been is to be contrasted with its ordinary function in civil actions of determining what was. In determining what did happen in the past a court decides on the balance of probabilities. Anything that is more probable than not it treats as certain. But in assessing damages which depend upon its view as to what will happen in the future or would have happened in the future if something had not happened in the past, the court must make an estimate as to what are the chances that a particular thing will or would have happened and reflect those chances, whether they are more or less than even, in the amount of damages which it awards."

In assessing the plaintiff's earning capacity in the present case, what had to be evaluated was the prospect that the deteriorating back condition would have precluded him from engaging in gainful employment had…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [1990] HCA 20
Decision Date: 29 May 1990

CaseChat Overview and Summary

In *Malec v JC Hutton Pty Ltd*, the High Court of Australia considered an appeal from a judgment of the Supreme Court of New South Wales. The appellant, Mr Malec, had suffered injuries in the course of his employment with the respondent, JC Hutton Pty Ltd, and sought damages for negligence. The primary dispute concerned the assessment of damages, specifically the extent to which the appellant's chances of future employment in a particular field should be taken into account, given that those chances were diminished by a pre-existing condition unrelated to the employer's negligence.

The central legal issue before the High Court was how to assess damages for loss of earning capacity when that capacity is affected by both the injury caused by the defendant's negligence and a pre-existing condition. The court was required to determine whether the chance of future employment, which was already reduced by the pre-existing condition, should be discounted further to reflect the possibility that the appellant might not have obtained such employment even if the injury had not occurred.

The High Court held that damages for loss of earning capacity should be assessed by reference to the chance of the appellant obtaining employment in the relevant field. The court reasoned that the assessment of damages is concerned with the loss of a chance, and that the value of that chance should be discounted to reflect all contingencies, including the pre-existing condition. Therefore, the chance of future employment was to be assessed on the balance of probabilities, and the value of that chance was to be discounted by the probability that the appellant would not have obtained employment in that field due to his pre-existing condition. The court affirmed the principle that damages are awarded for the loss of a chance, and that the value of that chance is to be determined by reference to the probabilities of the matter.

Orders