Marshall v Beaver

[1995] QCA 310

IN THE COURT OF APPEAL

[1995] QCA 310

SUPREME COURT OF QUEENSLAND

Appeal No. 29 of 1995

Before the Court of Appeal

McPherson J.A.
Demack J.

Shepherdson J.

[Marshall v. Beaver]

BETWEEN

SCOTT DONALD MARSHALL an infant by his
next friend DONALD ROSS MARSHALL

(Plaintiff) Respondent

AND

ALAN RICHARD BEAVER

(First Defendant) Appellant

AND

PETER FREDERICK WARREN

(Second Defendant) Appellant

REASONS FOR JUDGMENT - THE COURT

Judgment delivered the 21st day of July 1995

When Scott Marshall was aged eleven years he sustained serious head injuries. When his action for personal injuries came on for hearing, liability and most of the components of the damages were admitted. The parties asked the trial judge to assess the cost of future personal services and the diminution in future earning capacity. The latter component was assessed at $325,000 and from this assessment an appeal has been brought on the basis that it is manifestly excessive.

The following findings in the judgment appealed from describe Scott's pre-accident condition and the impact of his injuries:

" Before the accident, the plaintiff was in excellent general health. He was then in grade 6 at his local State school. He was good at sport, and he was adept at practical things around his family's farm. He was of average intelligence; but he was a poor reader and was receiving remedial teaching to alleviate this relative weakness. However, the plaintiff coped with his school work before the accident.

The brain damage has significantly impaired the plaintiff's physical functioning. Although he can still participate in social tennis and cricket, he is awkward and inclined to stumble or fall because of problems with co-ordination and balance. At work, he tires when others would not. He has also suffered major impairment of mental faculties. He now has a poor short-term memory, reading skills of a low order, reduced powers of concentration, difficulty with problem-solving, and limited insight into his condition. Because of his intellectual and physical deficits and an associated impetuous streak to this post-accident nature, he is accident-prone."

His Honour then considered Scott's likely career path and

found:

"His pre-accident level of intellectual functioning, including his reading disorder, suggest that he probably would have progressed to managing or owning a smaller sized property."

This had been the approach taken by the plaintiff's legal advisers who had prepared a schedule which became ex. 6. This schedule was then produced to a Mr Henderson who commented on it. Mr Henderson is a pastoral consultant and has some management responsibilities for five cattle properties, among other activities. He discussed the schedule at some length, and it is in respect of this evidence that it is contended that the trial judge fell into error.

The nature of the error is variously described in the notice of appeal, the appellant's outline of argument and the amended outline of argument for the appellant. However, the basic assertion is that ex. 6 does not describe the likely career path for the plaintiff. This assertion is based on some of Mr Henderson's answers. Specifically, it is contended these show that the best Scott could have hoped for is a gross income of $30,000 per year as a working manager. Exhibit 6 shows him progressing to a net weekly income of $919.50 as a station manager. The schedule advanced by the appellants shows a gross earning capacity of $372,246, whereas the modified version of ex. 6 shows a gross figure of $580,315.

It was accepted that there was an error in ex. 6. The appellants' contention is that the sum of $325,000 is excessive by about $100,000.

The first thing that can be said is that ex. 6 is based on award rates (T.142 l.18). Mr Henderson said that not all employers paid award rates, and his evidence about one junior manager over whom he has control is that at 28 years of age he is paid $30,000 gross. That is the figure on which the appellants' schedule is constructed. Clearly enough the award rates have to be taken into account, even if they are not the only relevant matters.

Mr Henderson's opinion was that Scott would have the intellectual capacity to be a working manager under some supervision (T.147, l.22 and T.151, l.40). Mr Henderson's responsibilities for the properties under his control (T.140, ll.1-8) are that he supervises and manages them for the owners. The managers employed on those properties would then fit the description he gave of Scott's potential, i.e. working manager under supervision. Some of these men are paid $35,000 gross plus fringe benefits of about $300 per week (T.150, ll.42-58). Such men are in their mid-thirties. On ex. 6, that level of income is not anticipated until 2010, when Scott is aged 34 years. In this way, Mr Henderson's evidence gives some broad support for ex. 6.

His Honour recognised the limitations in ex. 6, saying,
"No mathematical exercise really assists in determining the

compensation for diminution of earning capacity" (T.189, l.1).

He then went on:

"In a case such as this, lots of calculations may create the false appearance of precision in the assessment and are more likely to beguile than to inform. However, a couple of calculations are not entirely without interest. First, on the 5% tables, the present value of a loss of $300 net per week after tax, every week until age 60, is a little less than $275,000. (A full-rate stockman commonly earns about $300 per week after tax.) Secondly, if $600,000 is discounted by 15%, and from that $510,000 there is deducted the present value of an assumed residual capacity of an average of, say, $150 net per week, the loss yielded is about $370,000.

All things considered, the present value of what he can now expect to earn seems unlikely to exceed about a third of the present value of what he might well have expected to receive otherwise. As it happens, an appropriate reflex of the loss seems to lie between $275,000 and $370,000. I fix on $325,000."

In the light of the finding that Scott is accident prone,
it seems clear that he would not be employable as a stockman.
His present employer, Mr Cleary, gave evidence about his
inability to appreciate danger. This then is a useful
indicator of one aspect of his loss of earning capacity. The
15% discount is apparently for contingencies. What becomes
clear from this passage is that His Honour was not using ex.

6 in a mathematical way. It was only used as a very broad

guide.

Earlier in his reasons for judgment he had said (T.187,

ll.6-20):

"Of course, the plaintiff might not have earned as much as the exercise suggests. He might have undertaken less remunerative work: for example, in a trade. He might have peaked at the level of a head stockman. Or he might not have been continuously employed. Vicissitudes such as accidents or ill-health may have impacted on future earnings. He may have experienced delays in progressing along the projected career path. And the rewards of a working manager are, as Mr Henderson's evidence show, negotiable and dependent upon the property-owner's capacity to pay. But, for most people at any rate, life is not all misfortune. It should not be assumed that the contingencies

bearing on an estimate of the lost earnings would all have been adverse. Nevertheless, a discounting of the $600,000 figure is called for to reflect the chances that, for any number of reasons, the plaintiff might well have earned less than the projection tends to indicate."

It is against these considerations that his assessment must be weighed. The approach that the appellant urges seeks to ignore them, and to focus only on parts of Mr Henderson's evidence to the exclusion of Mr Cleary's evidence, and, indeed, to the exclusion of the medical and psychological evidence.

In the light of all of His Honour's findings which have been quoted, it cannot be said that the assessment of $325,000 for diminution in future earning capacity is manifestly excessive. His Honour considered all the relevant factors and the award was within the range the evidence disclosed.

The appeal should be dismissed with costs.

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 29 of 1995

Brisbane
[Marshall v. Beaver]

BETWEEN

SCOTT DONALD MARSHALL an infant by his
next friend DONALD ROSS MARSHALL

(Plaintiff) Respondent

AND

ALAN RICHARD BEAVER

(First Defendant) Appellant

AND

PETER FREDERICK WARREN

(Second Defendant) Appellant

McPherson J.A.
Demack J.

Shepherdson J.

Judgment delivered 21/07/95

Reasons for judgment by the Court

APPEAL DISMISSED WITH COSTS.

CATCHWORDS	PERSONAL INJURIES - DAMAGES - Whether assessed cost of future personal services and damages for diminution in future earning capacity was manifestly excessive.
Counsel:	W. Campbell for the respondent P. Ambrose for the appellants
Solicitors:	Ebsworth & Ebsworth for the respondent Hemming & Hart for the appellants

Hearing Date: 9 June 1995