Montemaggiori v Wilson

[2011] WASCA 177

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MONTEMAGGIORI -v- WILSON [2011] WASCA 177

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2011] WASCA 177
Court:	THE COURT OF APPEAL (WA)
Case No:	CACV:46/2010	Heard:	4 FEBRUARY 2011
Coram:	BUSS JA NEWNES JA MURPHY JA	Delivered:	12/08/11
No of pages:	58	Judgment Part:	1 of 2
Result:	Appeal allowed in part
Category:	B	Other Parts:	Pages 51 to 58
PDF Version

Parties:	ELISA MONTEMAGGIORI PATRICK MICHAEL WILSON
Catchwords:	Negligence Motor vehicle accident Assessment of damages Relevant principles Whether appropriate to assess respondent's past loss of earning capacity as percentage of earning capacity in pre­accident occupation Evidence of respondent's retained earning capacity overlooked Whether appropriate to assess respondent's future loss of earning capacity as percentage of earning capacity in pre­accident occupation where evidence given of actual future earning capacity Respondent alleged loss suffered by forced early sale of investment property Whether respondent would otherwise have been entitled to discounted rate of capital gains tax on proceeds Proceeds taxable as ordinary income not capital gain Damages reassessed
Legislation:	Income Tax Assessment Act 1997 (Cth), s 6.5, pt 3.1 of ch 3
Case References:	AGC (Investments) Ltd v Federal Commissioner of Taxation (1991) 21 ATR 1379 Baird v Roberts (1977) 2 NSWLR 389 Bowen v Tutte (1990) Aust Torts Rep 81-043 Brown v Dato Pty Ltd [2006] WASCA 170 Devries v Australian National Railways Commission [1993] HCA 78; (1993) 177 CLR 472 Federal Commissioner of Taxation v Cooling (1990) 22 FCR 42 Federal Commissioner of Taxation v St Helens Farm (ACT) Pty Ltd [1981] HCA 4; (1981) 146 CLR 336 Federal Commissioner of Taxation v The Myer Emporium Ltd [1987] HCA 18; (1987) 163 CLR 199 Federal Commissioner of Taxation v Whitfords Beach Pty Ltd [1982] HCA 8; (1982) 150 CLR 355 Graham v Baker [1961] HCA 48; (1961) 106 CLR 340 Griffiths v Kerkemeyer [1977] HCA 45; (1977) 139 CLR 161 Husher v Husher [1999] HCA 47; (1999) 197 CLR 138 Kealley v Jones (1979) 1 NSWLR 723 Kember v Thackrah [2000] WASCA 198 Linsell v Robson (1976) 1 NSWLR 249 Malec v J C Hutton Pty Ltd [1990] HCA 20; (1990) 169 CLR 638 McCracken v Melbourne Storm Rugby League Football Club Ltd [2007] NSWCA 353; [2007] Aust Torts Rep 81-925 Medlin v State Government Insurance Commission [1995] HCA 5; (1995) 182 CLR 1 Miller v Jennings [1954] HCA 65; (1954) 92 CLR 190 Minchin v Public Curator of Queensland [1965] ALR 91 Paul v Rendell (1981) 34 ALR 569 Pene v Murphy [2003] WADC 96 Pene v Murphy [2004] WASCA 103 Potter v State Government Insurance Commission (1990) Aust Torts Rep 81-015 Setton v Eves [2006] WASCA 3 State of New South Wales v Moss [2000] NSWCA 133; (2000) 54 NSWLR 536 Taylor v Walawski (Unreported, WASCA, Library No 8992, 9 August 1991) Thomas v O'Shea (1989) Aust Torts Rep 80-251 Todorovic v Waller [1981] HCA 72; (1981) 150 CLR 402 Van Gervan v Fenton [1992] HCA 54; (1992) 175 CLR 327 Van Velzen v Wagener (1975) 10 SASR 549 Villesevil v Pickering [2001] WASCA 143; (2001) 24 WAR 167

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA TITLE OF COURT : THE COURT OF APPEAL (WA) CITATION : MONTEMAGGIORI -v- WILSON [2011] WASCA 177 CORAM : BUSS JA

NEWNES JA
MURPHY JA

HEARD : 4 FEBRUARY 2011 DELIVERED : 12 AUGUST 2011 FILE NO/S : CACV 46 of 2010 BETWEEN : ELISA MONTEMAGGIORI

Appellant

AND

PATRICK MICHAEL WILSON
Respondent

ON APPEAL FROM:

Jurisdiction : DISTRICT COURT OF WESTERN AUSTRALIA

Coram : STONE DCJ

Citation : WILSON -v- MONTEMAGGIORI [2010] WADC 55

File No : CIV 1394 of 2007

(Page 2)

Catchwords:

Negligence - Motor vehicle accident - Assessment of damages - Relevant principles - Whether appropriate to assess respondent's past loss of earning capacity as percentage of earning capacity in pre­accident occupation - Evidence of respondent's retained earning capacity overlooked - Whether appropriate to assess respondent's future loss of earning capacity as percentage of earning capacity in pre­accident occupation where evidence given of actual future earning capacity - Respondent alleged loss suffered by forced early sale of investment property - Whether respondent would otherwise have been entitled to discounted rate of capital gains tax on proceeds - Proceeds taxable as ordinary income not capital gain - Damages reassessed

Legislation:

Income Tax Assessment Act 1997 (Cth), s 6.5, pt 3.1 of ch 3

Result:

Appeal allowed in part

Category: B

Representation:

Counsel:

Appellant : Ms B A Mangan
Respondent : Mr K S Pratt

Solicitors:

Appellant : Talbot & Olivier
Respondent : Trewin Norman & Co

Case(s) referred to in judgment(s):

AGC (Investments) Ltd v Federal Commissioner of Taxation (1991) 21 ATR 1379
Baird v Roberts (1977) 2 NSWLR 389
Bowen v Tutte (1990) Aust Torts Rep 81-043

(Page 3)

Brown v Dato Pty Ltd [2006] WASCA 170
Devries v Australian National Railways Commission [1993] HCA 78; (1993) 177 CLR 472
Federal Commissioner of Taxation v Cooling (1990) 22 FCR 42
Federal Commissioner of Taxation v St Helens Farm (ACT) Pty Ltd [1981] HCA 4; (1981) 146 CLR 336
Federal Commissioner of Taxation v The Myer Emporium Ltd [1987] HCA 18; (1987) 163 CLR 199
Federal Commissioner of Taxation v Whitfords Beach Pty Ltd [1982] HCA 8; (1982) 150 CLR 355
Graham v Baker [1961] HCA 48; (1961) 106 CLR 340
Griffiths v Kerkemeyer [1977] HCA 45; (1977) 139 CLR 161
Husher v Husher [1999] HCA 47; (1999) 197 CLR 138
Kealley v Jones (1979) 1 NSWLR 723
Kember v Thackrah [2000] WASCA 198
Linsell v Robson (1976) 1 NSWLR 249
Malec v J C Hutton Pty Ltd [1990] HCA 20; (1990) 169 CLR 638
McCracken v Melbourne Storm Rugby League Football Club Ltd [2007] NSWCA 353; (2007) Aust Torts Rep 81-925
Medlin v State Government Insurance Commission [1995] HCA 5; (1995) 182 CLR 1
Miller v Jennings [1954] HCA 65; (1954) 92 CLR 190
Minchin v Public Curator of Queensland [1965] ALR 91
Paul v Rendell (1981) 34 ALR 569
Pene v Murphy [2003] WADC 96
Pene v Murphy [2004] WASCA 103
Potter v State Government Insurance Commission (1990) Aust Torts Rep 81-015
Setton v Eves [2006] WASCA 3
State of New South Wales v Moss [2000] NSWCA 133; (2000) 54 NSWLR 536
Taylor v Walawski (Unreported, WASCA, Library No 8992, 9 August 1991)
Thomas v O'Shea (1989) Aust Torts Rep 80-251
Todorovic v Waller [1981] HCA 72; (1981) 150 CLR 402
Van Gervan v Fenton [1992] HCA 54; (1992) 175 CLR 327
Van Velzen v Wagener (1975) 10 SASR 549
Villesevil v Pickering [2001] WASCA 143; (2001) 24 WAR 167


(Page 4)

1 BUSS & NEWNES JJA: This is an appeal against a decision of Stone DCJ in the District Court in which he found the appellant liable to pay to the respondent damages in the sum of $311,930.45 for personal injury caused by a collision on 4 May 2006 between the bicycle the respondent was riding and a motor vehicle driven by appellant.

2 The appellant contends that his Honour erred in assessing the damages and should have found that the respondent had failed to make out his claims for, among other things, past loss of earning capacity and future loss of earning capacity.

The findings of the primary judge

3 Liability was not in issue. The parties had agreed prior to trial that whilst the appellant was primarily liable for the accident there was contributory negligence on the respondent's part, so that liability should be apportioned 75:25 in favour of the respondent [6]. The only issue was as to the damages to which the respondent was entitled.

The respondent's background

4 His Honour noted that the respondent was 38 years of age at the time of the accident. He was married and his wife (Mrs Wilson) was pregnant with their first child. The respondent had left school in year 11 and worked for a cabinet-making business for 12 months before undertaking a four-year apprenticeship as a panel beater. Having completed his apprenticeship, the respondent worked as a panel beater for five to six years before commencing a lawn mowing and landscaping business with one of his brothers. The respondent and his brother were taught tree lopping by a friend and the respondent then worked with his brother carrying out tree lopping and general garden clean-up work for eight or nine years.

5 The respondent took a break from tree lopping in 2004 but intended to resume that work by 1 August 2006 when his wife was to cease work prior to the birth of the baby in September 2006. The respondent and his wife intended that she would stay home to care for the child and he would be the sole income earner. Between 2004 and the time of the accident, the respondent undertook house renovation, purchasing and renovating several residential properties which he sold once more than 12 months had passed from the date of purchase in order to minimise capital gains tax. At the time of the accident the respondent and his wife had purchased a property in Embleton for that purpose. They had acquired the property in January 2006. They sold the property immediately after the accident.

(Page 5)

6 At the time of the accident Mrs Wilson was working in a management role with Sensis on an annual salary of approximately $130,000, together with substantial fringe benefits. Following the accident, she did not resign from her position as originally intended but took 12 months maternity leave and then returned to work in August 2007. In 2008, Mrs Wilson gave birth to their second child and again returned to work after 12 months maternity leave. By the time of the trial, Mrs Wilson had changed her employment but was earning much the same as she had at Sensis.

The respondent's disabilities

7 The primary judge found that following the accident on 4 May 2006 the respondent was admitted to hospital where he was treated for a comminuted fracture of the left clavicle. Some time later he was seen by an orthopaedic surgeon, Mr Hogan, who found that the fracture had not united and, on 8 August 2006, performed an open reduction and internal fixation of a metal plate and screws to the respondent's left clavicle. On 20 June 2007, Mr Hogan removed the plate and screws at the respondent's request because of pain in the lateral aspect of his shoulder.

8 In late 2007, Mr Hogan suggested that the respondent undergo an arthroscopic acromio-clavicular joint resection which, in Mr Hogan's opinion, usually resulted in good long term function and strength after a recovery period of between six weeks and three months. The respondent, however, declined to undergo further surgery because its success was not assured. (The finding of the primary judge that the respondent had not acted unreasonably in refusing the surgery was not in issue on the appeal.) Mr Hogan reported that when he last saw him, in 2009, the respondent had a full range of movement but was mildly tender over the joint. Mr Hogan considered that the respondent was capable of working as a driver, salesman, security guard, and in most other manual and non-manual activities.

9 The respondent also consulted a neuro-surgeon, Mr Watson. When Mr Watson last saw the respondent, in 2009, he had on-going pain in the cervical spine, clavicle and shoulder. Mr Watson concluded that the respondent's main disability was a marked reduction in his ability to extend the shoulder joint. Mr Watson considered that because of the restrictions in his left shoulder joint and his left clavicle injuries, it was unlikely he would be able to return to his pre-accident work as a tree lopper or house renovator but would need to retrain for supervisory or sedentary activities.

(Page 6)

10 The respondent saw a consultant physician in rehabilitation medicine, Dr Ker, on a number of occasions in 2007, 2008 and 2009. Dr Ker considered that over that time there had been modest improvement in the respondent's range of left shoulder movements but he had substantive physical limitations with the use of his left arm in resistive or lifting activities of substance. Dr Ker did not consider that that was likely to improve. Dr Ker considered that the respondent would not be able to return to tree lopping or other physically demanding work which required the continuous use of his upper limbs in resistive tasks, or heavy lifting or labouring requiring both hands.

11 An occupational physician, Dr Home, saw the respondent in 2008 and 2009 and considered it was probable that the respondent did not have any residual incapacity as a result of the clavicle fracture but had partial incapacity as a result of a minor soft-tissue injury to his shoulder. Dr Home considered that the respondent would be unable to be engaged in work requiring heavy lifting but retained a capacity for full-time employment in occupations such as a vocational driver, process worker, storeman, yardman, security guard and transport clerk.

12 Another orthopaedic surgeon, Mr Robinson, saw the respondent in 2009. Mr Robinson found that as a result of the accident the respondent had wasting of the muscle in the shoulder blade and mild bursitis of the sub-acromial space. Mr Robinson considered that the respondent would be unable to return to his pre-accident job as a tree lopper.

13 The respondent's general practitioner, Dr Atlas, considered that as a result of the accident the respondent was unable to work as a tree lopper or in renovating houses but he could do clerical work or non-manual work such as driving, sales or reception work.

14 The primary judge found that as a result of the accident the respondent had suffered soft tissue strain injuries to his cervical spine and a relatively severe fracture of his left clavicle. His Honour further found, relevantly, that the respondent had some restriction of movement in his left shoulder and tenderness across the collarbone, and a limited ability to bear weight before he experienced pain [22].

15 The primary judge concluded that the respondent was permanently incapacitated from returning to work as a tree lopper [33]. His Honour found, however, that the respondent had, from 1 August 2006, a retained capacity for full-time employment in less physical activities, such as those mentioned by Dr Atlas, Mr Hogan and Dr Home, which did not involve

(Page 7)

very heavy manual work or the continuous use of his left arm at or above shoulder level [34]. His Honour found that despite having that retained capacity since 1 August 2006, the respondent had not made any reasonable attempt to obtain employment [36].

Past loss of earning capacity

16 In determining the respondent's past loss of earning capacity, the primary judge relied on the evidence of the respondent as to his earnings as a tree lopper, and general evidence as to the earnings of tree loppers given by Mr Sublet and Mr O'Dea (who are both proprietors of tree lopping companies) and Professor Mulvey, a labour market economist. In addition to Professor Mulvey's oral evidence, his Honour relied on a report Professor Mulvey had prepared, dated 26 February 2009, which went into evidence as exhibit P3. (We should say that the primary judge appears to have used the terms 'tree lopper' and 'tree climber' interchangeably, although the respondent's evidence was that he intended to return to work in 2006 as a tree climber; that is, someone who scaled the trees to lop them rather than being involved in other work associated with tree lopping. There was no evidence of any difference in earnings (ts 23).)

17 The respondent gave evidence as to his taxable income in the last four full financial years in which he worked as a tree lopper. That evidence revealed that his gross income from tree lopping varied between an average of $524.48 per week for the financial year ended 30 June 2001, an average of $718.69 per week in the year ended 30 June 2002, an average of $602.63 per week in the year ended 30 June 2003 and an average of $509.84 per week in the year ended 30 June 2004, with an overall average over the four years of $588.91 per week.

18 The primary judge referred to the evidence of Mr Sublet that in July 2008 he employed a tree climber who worked at least 40 hours per week at a rate of $30 - $31 per hour, and the evidence of Mr O'Dea that at the time of trial he employed two tree climbers who worked at least 40 hours per week at a rate of $30 per hour. His Honour noted Mr Sublet's evidence that the injury rate for tree climbers was high and as a result their working life was usually not more than 15 years.

19 His Honour also referred to evidence given by Professor Mulvey that the likely minimum rate of pay for tree loppers and climbers was approximately $620 (gross) per week and an advertisement for a tree lopper in May 2009 had offered $25 per hour. He said it was

(Page 8)

Professor Mulvey's opinion that a tree lopper working 40 hours per week would earn $1,000 (gross) per week.

20 The primary judge found that the respondent would have earned at least $800 (net) per week (approximately $1,000 gross per week), from 1 August 2006, if he had returned to work as a tree climber [65]. (The respondent made no claim for the period from 4 May to 31 July 2006 on the basis that he would not have worked in that time in any event.)

21 The primary judge concluded:

In the absence of evidence of the earnings [the respondent] could have derived from the light duty occupations I will assess his retained earning capacity as a percentage of his earning capacity as a contract tree climber as at 1 August 2008 [sic, 2006] save for the accident: Bowen v Tutte (1990) Aust Torts Reports 81-043; Pene v Murphy [2004] WASCA 103. However, there are a number of factors that would have made [the respondent's] entry into the job market difficult: his age, his level of education, his communication skills, his lack of experience in the occupations mentioned, his late entry into the employment market, the fact that he would be competing for employment with much younger persons and his disability.

Having regard to my finding as to the extent of [the respondent's] ability to work in lighter occupations, the factors that disadvantage his entry into the job market and his failure to make any reasonable attempt to regain employment and using the WA Government Department of Consumer and Employment Protection's Minimum Conditions of Employment Act Summary as a guide, I find that with effect from 1 August 2006 the amount of [the respondent's] earning capacity should be reduced by 50% [67] - [68].

Based on his finding that the respondent had a retained earning capacity of 50% from 1 August 2006, the primary judge concluded that the respondent had a loss of earnings of $400 (net) per week from that date. His Honour reduced that amount by 3% to allow for the generally higher risk of injury among tree climbers. That led to a total amount by way of past loss of earning capacity as at the date of judgment (29 April 2010) of $75,605.68 [69]. Interest on this figure was calculated at $2,268.17.

Future loss of earning capacity

22 The primary judge concluded that, based on the evidence of the respondent, Mr Sublet, Mr O'Dea and Professor Mulvey, if the respondent had not been injured in the accident he would have earned at least $1,000 (net) per week as a tree climber until retirement at the age of 65 [77]. His Honour considered that in calculating the respondent's future loss of

(Page 9)

earning capacity there was no reason to alter his earlier finding that the respondent had a residual earning capacity of 50%.

23 His Honour made a deduction of 15% for contingencies in light of the respondent's intention to work to 60 years of age, rather than 65, and the evidence as to the strenuous nature of tree lopping and the high rate of injury [79]. His Honour determined that the respondent's future loss of earning capacity was therefore $500 per week. Applying a 6% multiplier and a deduction of 15% for contingencies, his Honour concluded that the total award of damages for future loss of earning capacity was $274,975.

Embleton property sale

24 The primary judge was satisfied that the accident was a contributing cause of the sale of the Embleton property. He found that it was sold immediately after the accident because of the concern of the respondent and Mrs Wilson that it was subject to a heavy mortgage, it appeared the respondent would be unable to complete the renovation of the house or do any other work, and Mrs Wilson would soon not be earning an income. His Honour found that the sale of the property less than 12 months after it was purchased resulted in the respondent paying an additional $14,930.50 in tax because he was not entitled to the discounted capital gains rate that would have been applicable had the property been owned by the respondent for at least 12 months [72]. His Honour held that the respondent was entitled to damages in that amount and interest on it in the sum of $447.92.

Medical expenses and general damages

25 The primary judge found that the respondent was entitled to the sum of $2,500 for past and future medical and travel expenses and general damages of $45,180. Those amounts were not in issue on the appeal.

The damages award

26 The assessment made by his Honour was as follows:

Past loss of earning capacity as a tree lopper	$75,605.68
Interest on past loss of earning capacity as a tree lopper	$2,268.17
Past economic loss from extra taxation paid on sale of Embleton property	$14,930.50

(Page 10)

Interest on past economic loss from extra taxation on sale of Embleton property	$447.92
Future loss of earning capacity	$274,975.00
Past medical treatment expenses and travel expenses	$500.00
Future medical treatment expenses	$2,000.00
Non-pecuniary loss	$45,180.00
Total	$415,907.27

From that sum his Honour deducted 25% for contributory negligence, resulting in an award of damages in the total sum of $311,930.45.

Grounds of appeal

27 There are four grounds of appeal, the substance of which are as follows:

(a) The primary judge erred in fact and law in assessing damages for past loss of earning capacity to be $75,605.68, in that such a finding was against the weight of the evidence and was inconsistent with his Honour's findings that:

(i) the respondent's average earnings from tree lopping had been $588.91 per week;

(ii) the respondent had not worked as a tree lopper since 2004;

(iii) from 1 August 2006 the respondent had a retained capacity for other full-time work but had unreasonably failed to seek such work;


and the evidence that his earnings from such other work would have been equal to or greater than his earnings as a tree lopper. The primary judge should have found that the respondent had failed to prove any loss.
(b) The primary judge erred in fact and law in assessing damages for future loss of earning capacity to be $274,975.00, in that such a finding was against the weight of the evidence and was inconsistent with the matters set out in (a) and the evidence of

(Page 11)

Mr Sublet that tree loppers have a limited working life. His Honour should have found that the respondent had failed to prove any loss and was not entitled to any amount or, alternatively, was entitled only to a modest global allowance for future loss of earning capacity.

(c) The trial judge erred in fact and law in finding that the Embleton property had to be sold as a consequence of the accident when the finding was against the weight of the evidence.

(d) The trial judge erred in law in finding that because the Embleton property was sold within 12 months of its purchase, the respondent had suffered a loss by not being entitled to a lower rate of capital gains tax as, whenever it was sold, the proceeds of the sale were not subject to capital gains tax but constituted part of the respondent's ordinary income for tax purposes.

Disposition of the appeal

28 Before turning to deal with the specific grounds of appeal, it is relevant to note that, as Deane and Dawson JJ pointed out in Van Gervan v Fenton [1992] HCA 54; (1992) 175 CLR 327, 343, the assessment of damages for personal injuries in an action for negligence is not an exact science. The process of assessment must be governed by considerations of practical common sense in the context of the facts of the particular case. In a similar vein, in Paul v Rendell (1981) 34 ALR 569 the Privy Council observed:

The assessment of damages in actions for personal injuries is not a science. A judgment as to what constitutes proper compensation in money terms for pain, suffering or deprivation of amenities of life, can only be intuitive, and the assessment of future economic loss involves a double exercise in the art of prophesying not only what the future holds for the injured plaintiff but also what the future would have held for him if he had not been injured (571).

29 Such an assessment has many of the characteristics of a discretionary judgment: Federal Commissioner of Taxation v St Helens Farm (ACT) Pty Ltd [1981] HCA 4; (1981) 146 CLR 336, 381. In order to justify the review by an appellate court of an assessment of damages on the grounds they are excessive, the compensation so assessed must be so excessive as to be beyond the limits of what a sound discretionary judgment could reasonably adopt: see Miller v Jennings [1954] HCA 65; (1954) 92 CLR 190, 197; Minchin v Public Curator of Queensland [1965] ALR 91, 96.

(Page 12)

30 The plaintiff who seeks damages has the legal onus of proving loss of earning capacity and the extent to which that loss produces, or might produce, financial loss: Todorovic v Waller [1981] HCA 72; (1981) 150 CLR 402, 412; Medlin v State Government Insurance Commission [1995] HCA 5; (1995) 182 CLR 1, 3. If it is determined that there has been a loss of earning capacity it is then necessary, having regard to the established facts of the past and the probabilities of the future, to determine the damage that will flow from the loss of that capacity: Medlin v State Government Insurance Commission (19). As the plurality pointed out in Malec v J C Hutton Pty Ltd [1990] HCA 20; (1990) 169 CLR 638, 643, when the law takes account of future or hypothetical events in assessing damages, it can only do so in terms of the degree of probability of those events occurring. Unless the chance is so low as to be speculative or so high as to be practically certain, the court will take that chance into account in assessing damages. The inquiry - the process of estimation of probabilities - is thus an imprecise and indeterminate one to be carried out within very broad parameters: State of New South Wales v Moss [2000] NSWCA 133; (2000) 54 NSWLR 536, 553. Accordingly, damages for financial loss likely to result from personal injury can only be an estimate, often a very rough estimate, of the present value of the prospective loss: Todorovic (413).

31 Whilst it is desirable for a plaintiff to call precise evidence of what he or she would have been likely to earn but for the injury, where earning capacity has unquestionably been reduced the failure to call such evidence, particularly in relation to future loss, does not mean that the plaintiff is not entitled to damages or is entitled only to nominal damages: State of New South Wales v Moss (552, 554). But where evidence ought to have been available, it is hard for a plaintiff who fails to call evidence, or calls incomplete evidence, to complain of a low award: State of New South Wales v Moss (552); Minchin v Public Curator of Queensland (93).

32 Where an injured plaintiff has suffered a loss of earning capacity, such as a total loss of capacity to earn in an occupation in which he has previously been employed, the court should do its best to place a value on that loss, even in the absence of evidence, or where there is uncertainty in the evidence, as to the availability of employment within the plaintiff's residual capacity or the amount which could be earned in such employment. Thus, for example, in Bowen v Tutte (1990) Aust Torts Rep 81-043, it was held that in the absence of any evidence of the availability of suitable employment for an injured plaintiff, or of earnings which could be derived from such employment, a trial judge may, in an appropriate

(Page 13)

case, assess the plaintiff's residual earning capacity at a percentage of his or her pre-accident earning capacity. And in Pene v Murphy [2004] WASCA 103, it was held that the appellant's loss of earnings should be assessed as a percentage of his pre-accident earning capacity as there were considerable uncertainties associated with his prospects of obtaining work within his residual capacity. But as the court made clear in that case, such an approach is not appropriate in every case; in the end the question is one of fairness.

33 Once the plaintiff has proved that they have lost their pre-accident earning capacity and have been unable to find alternative employment, or that their condition has prevented them finding alternative employment, an evidentiary burden is cast on the defendant to show what alternative employment opportunities were open, including the state of the labour market and the likely earnings: Thomas v O'Shea (1989) Aust Torts Rep 80-251, 68,701 - 68,702; Setton v Eves [2006] WASCA 3 [27].

34 Against that background, we turn to the specific grounds of appeal.

Ground 1 - past loss of earning capacity

35 The appellant contends, in substance, that in determining the respondent's entitlement to damages for past loss of earning capacity the primary judge made three substantial errors. First, his Honour erred in assessing the income the respondent could have earned as a tree climber at $800 (net) per week and should have assessed it based on the respondent's average pre-accident earnings of $588.91 (gross) per week; secondly, his Honour overlooked the evidence of Professor Mulvey as to the income the respondent could have earned in other occupations of which he was capable and assessed the respondent's loss on the basis that there was no evidence as to such earnings [67]; and thirdly, his Honour found that there were a number of factors which would disadvantage the respondent's entry into the workforce in any of the occupations suggested by the medical experts [67], when there was no evidence to that effect.

36 Before turning to those specific issues, it is appropriate to mention that certain matters in relation to the respondent's post-accident earning capacity were not in issue. The inability of the respondent to engage in the occupation of a tree climber after the accident was not challenged at trial or on appeal. Nor was it in issue on the appeal that the respondent had had a retained earning capacity since 1 August 2006 [64]. There was also no challenge to the finding of the primary judge [34] that the respondent had a retained capacity for full-time work of the nature identified by the medical witnesses, namely, driver, salesman, security

(Page 14)

guard, process worker, storeman, yardman, and transport clerk. In addition, the respondent did not take issue with the finding of the primary judge that he had not made any reasonable attempt to obtain employment of a kind of which he was capable [66].

37 In our opinion, the contention that his Honour erred in assessing the income the respondent would have earned as a tree climber at $800 (net) per week from 1 August 2006, must be rejected. The evidence before the primary judge was that the respondent had earned an average of $588.91 (gross) per week in the four-year period up to 30 June 2004, some two years before the accident; that in 2008 and 2009, tree climbers employed by two contractors who gave evidence, Mr Sublet and Mr O'Dea, were earning $30 per hour and working at least a 40-hour week, a figure of $1,200 per week gross (approximately $950 per week after tax); and the evidence of Professor Mulvey in his report of 26 February 2009 of a possible award minimum of $620 (gross) per week and an apparent industry rate of $25 per hour or $1,000 gross per week (approximately $800 per week after tax).

38 The search for precision in such matters is illusory. As we have said, such assessments involve matters of estimation based on practical common sense applied to the facts of the case, and are invariably imprecise. While there was no direct evidence of the earnings of a tree lopper in 2006, having regard to the evidence before him we are not persuaded that the finding of the primary judge that a sum of $800 (net) per week was an appropriate amount was outside a sound discretionary judgment.

39 However, in our respectful view the primary judge did err in finding that there was no evidence as to the income the respondent could have earned after the accident in suitable occupations.

40 In a report dated 16 September 2008 (exhibit D4), Professor Mulvey considered the earnings and availability of employment in 12 specific occupations suggested by the appellant's solicitors. Those occupations included driver, transport clerk, metal and wood fabrication workers, storeman, process worker, security guard, surveyor's assistant, and sales assistant. It will be apparent that a number of those occupations were specifically mentioned in the medical evidence as work the respondent was capable of doing.

41 It appears from the report that some of the occupations considered by Professor Mulvey did not have good employment prospects or required

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particular skills or experience that it is not evident the respondent had. They included occupations such as metal and wood fabrication workers, transport clerk and surveyor's assistant.

42 For present purposes, it is sufficient to refer to three of the occupation groups referred to by Professor Mulvey and to mention a fourth. One was drivers, which Professor Mulvey noted covered a great many different types of work and for which there was, in general, reasonably high demand in Perth. He decided to report on delivery drivers for which employment prospects had fallen slightly or remained steady over the preceding five years. Professor Mulvey said that, based on census figures, the average weekly earnings of full-time employees in this occupation in August 2006 were $780 (gross). On the assumption that those earnings had increased in conformity with overall average weekly earnings in Western Australia, as at May 2008 the average weekly earnings of full-time delivery drivers were $883 (gross). He considered that a person who was prepared to work throughout the metropolitan area could find employment as a delivery driver within a reasonable period of time. (In oral evidence, Professor Mulvey said that by 'a reasonable period of time' he meant up to three months.) Professor Mulvey noted, however, that employment prospects for couriers, which were a particular type of delivery driver, were poor unless the person had their own vehicle.

43 Professor Mulvey said that the demand for process workers had remained steady or fallen slightly over the preceding five years but a person seeking employment as a process worker in light assembly work at a bench ought to be able to find employment in that occupation within a reasonable period of time. On the same basis as for delivery drivers, Professor Mulvey found that the average weekly earnings of such a worker in August 2006 were $628 (gross) and as at May 2008 were $711 (gross).

44 He also considered that the demand for storepersons had risen very strongly in the preceding five years and that a person seeking employment as a storeperson ought to be able to find employment within a reasonable period of time. The average weekly earnings of such a worker in August 2006 were $745 (gross) and as at May 2008 were $843 (gross).

45 In relation to some of the other occupations he reviewed, Professor Mulvey specifically referred to the difficulty in obtaining employment without experience or in the absence of specific skills or qualifications. In relation to sales assistants, he noted that juniors had very good employment prospects but that adults, while they also had good

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prospects, might take longer to find suitable employment. Professor Mulvey concluded that the average weekly earnings of a full-time adult sales assistant in August 2006 were $753 (gross) and in May 2008 were $852 (gross).

46 It appears that in finding there was no evidence of the earnings that the respondent could have derived from suitable lighter occupations, the primary judge simply overlooked the evidence of Professor Mulvey.

47 There was also, in our respectful opinion, no proper basis for his Honour's finding that by reason of his age, level of education, communication skills and lack of experience, the respondent would find difficulty in obtaining alternative work.

48 The evidence of Professor Mulvey does not support that finding. The conclusions reached by Professor Mulvey in the report were not challenged at trial. Nor was Professor Mulvey asked whether a person in the respondent's position might experience any difficulties in obtaining employment of the sort mentioned. However, on the appeal the respondent sought to rely in support of that contention on certain general evidence that Professor Mulvey gave. In that evidence Professor Mulvey accepted that ordinarily a person with no experience in a particular type of work would encounter more difficulty in obtaining a job in the area than someone with experience and that in light of 'the recent economic downturn' new entrants might experience greater difficulty in obtaining employment. He also confirmed that he was unaware of any statistics regarding the success rate of people who move into lighter work from heavy manual work or who have some kind of physical infirmity.

49 In the circumstances of this case, we do not consider that evidence of that general nature indicates that the respondent was likely to experience any material difficulty in obtaining employment, beyond those already referred to in Professor Mulvey's report.

50 Nor could such difficulties in obtaining work reasonably be inferred from the respondent's circumstances. At the time of the accident the respondent was, at 38 years of age, still a relatively young man and he had already demonstrated an ability to turn his hand successfully to a variety of quite different occupations. The respondent was not, in the jargon of some of the cases, an 'odd lot' on the labour market; that is, a person whose capacities are very limited so as to make him or her unfit for most lines of work other than their pre-accident work. There was no reason to believe that the respondent could not turn his hand to any of the

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occupations referred to just as readily as he had turned his hand to different occupations in the past. Indeed, in cross-examination the respondent accepted that he had the ability to retrain for other, lighter occupations (ts 130 - 131). For his own reasons the respondent chose not to exploit that retained capacity.

51 We should mention that Professor Mulvey acknowledged that, following an 'extraordinarily strong' labour market in 2006 and 2007, there had been a deterioration in the labour market generally in late 2008 and early 2009. That deterioration, however, came some time after the respondent was likely to have obtained work, had he looked for it reasonably promptly, and there is nothing to suggest that the downturn would have been likely to have resulted in the subsequent loss of that employment.

52 On the evidence, the respondent was not likely to have encountered any material difficulty in obtaining, and retaining, alternative employment had he sought to obtain it.

53 We do not, however, accept the appellant's contention that the respondent suffered no past loss of earning capacity. The respondent was precluded from employment as a tree climber, from which, on the finding of the primary judge, he would have earned $800 (net) per week. Putting aside process workers, where earnings were significantly lower, the suitable post-accident occupations referred to in Professor Mulvey's report had average earning capacities ranging from $745 - $780 (gross) per week in August 2006. In our view, on the evidence an appropriate assessment of the respondent's retained earning capacity was $750 (gross), or $640 (net), per week. That is $160 (net) per week less than he would have earned as a tree climber.

54 We should say that although some time was spent in argument on the appeal as to where the burden of proof lay in proving the availability of work within the respondent's retained capacity and the earnings that would be derived from it, it is unnecessary to consider that issue. It is immaterial in circumstances where evidence was adduced at trial which established that the respondent is able to do work of the kind referred to and there was no challenge to Professor Mulvey's evidence as to the general availability of work of that kind or the rates of remuneration it would produce.

55 In our view, with respect, the primary judge erred in assessing the respondent's retained earning capacity as 50% of his earning capacity as a

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tree lopper. Such an assessment was not appropriate in this case where there was substantial evidence as to the availability of employment within the respondent's residual capacity and the average amounts which could be earned in such employment.

56 For the reasons we have given, on the evidence the proper assessment of the respondent's past loss of earning capacity was $160 (net) per week. The relevant period, as determined by the primary judge, was a period of 194.86 weeks. That is a total sum of $31,177.60.

57 The primary judge made a deduction of 3% for contingencies. Whether or not a deduction for contingencies in relation to past loss of earning capacity is appropriate will depend upon the facts of the case: Brown v Dato Pty Ltd [2006] WASCA 170 [17]. Although it is an accepted practice not to make a deduction, there may be circumstances where a deduction is appropriate, such as where some years have elapsed between the injury and the trial: Griffiths v Kerkemeyer [1977] HCA 45; (1977) 139 CLR 161, 186. In that case, Mason J said that the period of four years which had elapsed might have justified some deduction. In this case the period was some four years. The deduction of 3% made by the primary judge was not challenged on the appeal and it was an appropriate deduction in the circumstances. We would not interfere with it.

58 A deduction of 3% amounts to $935.32. That gives a figure of $30,242.28. The interest rate of 3% allowed by the primary judge was an appropriate one. Interest at that rate amounts to $907.27. The total amount in respect of past loss of earning capacity is therefore $31,149.55.

59 In our opinion, the award of damages for past loss of earning capacity made by the primary judge was outside a sound discretionary range. We would uphold this ground of appeal. In place of the sum of $75,605.68 and interest of $2,268.17 allowed by the primary judge, should be substituted the sums of $30,242.28 and $907.27 respectively.

Ground 2 - future loss of earning capacity

60 On the hearing of the appeal, counsel for the respondent was unable to explain the basis upon which his Honour had found that had the respondent not been injured, his future earnings as a tree lopper would have been 'at least $1,000 (net)' per week. Although his Honour said that figure was based on the evidence of the respondent, Mr Sublet, Mr O'Dea and Professor Mulvey, the only relevant evidence was the evidence referred to above at [37], on which his Honour had arrived at a figure of $1,000 (gross) or $800 (net) per week for past loss of earning capacity.

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We understood counsel for the respondent effectively to concede (rightly in our view) that the figure of at least $1,000 (net) per week had no proper basis in the evidence and appeared to be an error by the primary judge (appeal ts 23 - 24).

61 In light of the evidence of Professor Mulvey as to the availability of suitable post-accident occupations and the earnings that could be derived from them, in our respectful opinion the primary judge again erred in calculating the respondent's retained future earning capacity as a percentage of the earning capacity he would have had as a tree lopper. A future loss of earning capacity of $500 net per week was not made out. On the basis of the evidence of Mr Sublet and Mr O'Dea, but for the injury as at the time of trial the respondent would have been able to earn some $1,200 (gross) or approximately $950 (net) per week as a tree lopper. Professor Mulvey gave evidence of one advertisement he had seen in May 2009 for a tree lopper at a rate $25 per hour (or $1,000 (gross) or approximately $800 per week (net) for a 40-hour week).

62 Professor Mulvey also gave evidence of the earnings in other occupations as at May 2008 based upon an assumption that those earnings had increased in accordance with overall average weekly earnings in Western Australia. That assumption was not challenged. Putting aside once again the figure for process workers, on Professor Mulvey's evidence the average earnings of the other occupations open to the respondent after his injury were, as at May 2008, some $850 (gross) or $720 (net). Allowing for some increase in the average earnings for those occupations between May 2008 and trial, in our view a figure of $200 (net) per week is an appropriate assessment of the respondent's future loss of earning capacity, rather than $500 (net) per week.

63 As to the period for which that loss should be calculated, in the light of the evidence we consider that the primary judge erred in projecting the loss to the age of 65 years, rather than to the age of 60. The primary judge expressly found it was the respondent's intention to work until the age of 60 [79]. In addition, there was the unchallenged evidence of Mr Sublet that the injury rate for tree climbers was high and their working life was usually not more than 15 years. The hazards involved in tree climbing were perhaps exemplified by the respondent's own accident in 1999 when he fell out of a tree and broke his collarbone. In our view, the future loss of earning capacity should have been projected for 17 years, when the respondent would reach 60 years of age.

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64 The primary judge made a deduction of 15% for contingencies. A figure of 15% is a very heavy discount: Kember v Thackrah [2000] WASCA 198 [27]; and see Taylor v Walawski (Unreported, WASCA, Library No 8992, 9 August 1991). The discount for ordinary contingencies is usually between 5% and 10%: see Villesevil v Pickering [2001] WASCA 143; (2001) 24 WAR 167 [38]. The figure of 15% reflects, no doubt, the primary judge's view as to the hazardous nature of the occupation of tree climbing, especially with increasing age.

65 In our opinion, the respondent's future loss of earning capacity should be calculated by reference to the difference between the respondent's potential earnings as a tree climber and his potential earnings in the alternative employment open to him. The latter employment is of a much more sedentary nature. For the reasons we have given, we do not consider that the respondent is likely to encounter any material difficulty in finding, and retaining, alternative employment of the nature we have indicated. Any very minimal disadvantage can be adequately compensated for by applying a lower percentage for contingencies than would otherwise be appropriate. The primary judge found that the respondent was capable of carrying out the alternative work, and he had shown in the past his adaptability in the different types of employment he had undertaken and in running an apparently successful business with his brother.

66 While (as we have mentioned) Professor Mulvey acknowledged that, following a strong labour market, there had been a deterioration in the labour market generally in late 2008 and early 2009, there was nothing to suggest that this was anything more than one of the economic fluctuations which inevitably occur from time to time. As the calculation of the loss is to be determined over a period of 17 years, it is not a factor which of itself would justify a substantial discount: see Kember v Thackrah [30].

67 In the circumstances, we consider that an appropriate discount for contingencies is 8% and that is the deduction we would apply.

68 We calculate that on the basis of a future loss of earning capacity of $200 (net) per week and applying a 6% multiplier for a period of 17 years to 60 years of age, the result is an amount of $110,260. That amount is to be discounted by 8% for contingencies, resulting, by our calculation, in an amount of $101,439.20.

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Ground 3 - the sale of the Embleton property

69 In our opinion, there is no substance in this ground of appeal. The appellant submitted, in effect, that the primary judge erred in finding that the accident was a cause of the sale of the property. As we understood the argument, it was contended that the reason for the sale of the property was not a panicked response to the accident as there was no reasonable basis for the respondent to think that his injury was such that he had to sell the property immediately. We should say, however, that the appellant did not dispute that, if that were the reason for the sale, the loss constituted a proper head of damage.

70 The primary judge accepted the evidence of the respondent and Mrs Wilson that the reason the property was sold was because they panicked after the accident as the respondent had a severe problem with his shoulder and was unable to work, the property was heavily mortgaged, and Mrs Wilson was to commence maternity leave in the coming months and would then give up her job. It is to be inferred that his Honour accepted, too, their evidence that, but for the accident, the property would not have been sold within the 12-month period.

71 The finding that the property was sold sooner than it otherwise would have been turned on his Honour's assessment of the credibility of the evidence of the respondent and Mrs Wilson. In Devries v Australian National Railways Commission [1993] HCA 78; (1993) 177 CLR 472, Brennan, Gaudron and McHugh JJ said:

More than once in recent years, this Court has pointed out that a finding of fact by a trial judge, based on the credibility of a witness, is not to be set aside because an appellate court thinks that the probabilities of the case are against - even strongly against - that finding of fact. If the trial judge's finding depends to any substantial degree on the credibility of the witness, the finding must stand unless it can be shown that the trial judge 'has failed to use or has palpably misused his advantage' or has acted on evidence which was 'inconsistent with facts incontrovertibly established by the evidence' or which was 'glaringly improbable' (479). (footnotes omitted)

It cannot be said that the finding of the primary judge was inconsistent with incontrovertible facts or glaringly improbable. It was a finding which was open to his Honour and no basis has been shown for interfering with it.

Ground 4 - the capital gains tax discount

72 It was submitted by the appellant that on the evidence it was not open to the primary judge to conclude that the sale of the Embleton

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property in July 2006, rather than after January 2007 when more than 12 months would have elapsed since its purchase, caused the respondent to be deprived of a lower rate of capital gains tax on the proceeds of sale than would otherwise have been the case. The Embleton property was, on the respondent's evidence, purchased with the intention of renovating it and selling it for profit, as he had with several other properties since 2002. The appellant argued that as the Embleton property had been acquired in the ordinary course of the respondent's business of buying and selling residential property for profit, it fell outside the capital gains provisions in pt 3.1 of ch 3 of the Income Tax Assessment Act 1997 (Cth) (ITAA). For the purposes of the ITAA, the proceeds of sale were income according to ordinary concepts: s 6.5 of the ITAA.

73 The respondent's evidence was that between 2004 and 2005 he was 'doing a bit of property development' (ts 33). That is consistent with his particulars of damage in which he described his pre-accident work as 'a tree lopper and renovator of residential properties' (particular 1.1). He said the first property he bought was in Light Street, Dianella, where he did some 'tidying up work' and then sold it at a profit. He held the Dianella property for about 18 months. He also bought a property in Rivervale which was renovated and sold at a profit. That property was held for about 15 months. The respondent then bought a property in Bedford. He subdivided the block and sold the rear block separately. He did 'quite an extensive renovation' of the house on the front block before selling that at a profit, after some 21 months. The next property acquired was the Embleton property which the respondent purchased in January 2006. His evidence as to his intentions in relation to the Embleton property was as follows:

Now, that is the one property that was sold before 12 months after purchasing it---Correct.

Why's that?---I had an accident prior to - I had a little bit more to go and probably hadn't quite finished the renovation work, we nearly got there. Our idea obviously was to do the same as we did with the previous properties, hold them for over 12 months, and then on sell them for a profit---

You'd nearly finished the renovation by the time of the accident, what was your intention, what were you going to do with the property for the balance of the 12 months?---We would have - we would have rented it out probably for about six to seven months more, till that twelve month period had elapsed, and then sold - on sold the property (ts 37 - 38).

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74 In cross-examination, the respondent confirmed that in respect of each of the Dianella, Rivervale, Bedford and Embleton properties his intention had been to purchase the property to repair or renovate it and, after holding it for around 12 - 18 months, to sell it at a profit (ts 75 - 76). It appears from the respondent's evidence that from the time he gave up tree climbing in 2004 up to the time of the accident that was his only income-producing activity, apart from any rental that may have been earned from letting the properties. None of the properties was ever occupied by the respondent or Mrs Wilson.

75 The question is whether the proceeds of the sale of the Embleton property constituted a capital gain under pt 3.1 of ch 3 of the ITAA, so that they would have been subject to the reduced rate of capital gains tax under subdivision 115A of ch 3 of the ITAA had the property been sold more than 12 months after acquisition, or whether they were taxable as ordinary income of the respondent under s 6.5 of the ITAA.

76 For present purposes, the relevant principles can be shortly stated. It is clear that the mere realisation to best advantage of a capital asset such as land, even if undertaken in an enterprising way, does not give rise to income according to ordinary concepts. But the profits on sale will constitute income according to ordinary concepts if the property concerned was acquired in a business operation or commercial transaction for the purpose of profit-making on its resale: Federal Commissioner of Taxation v The Myer Emporium Ltd [1987] HCA 18; (1987) 163 CLR 199, 209 - 210, 213.

77 As the High Court pointed out in Myer Emporium:

It is one thing if the decision to sell an asset is taken after its acquisition, there having been no intention or purpose at the time of acquisition of acquiring for the purpose of profit-making by sale. … But it is quite another thing if the decision to sell is taken by way of implementation of an intention or purpose, existing at the time of acquisition, of profit-making by sale, at least in the context of carrying on a business or carrying out a business operation or commercial transaction (213).

78 The fact that a profit or gain is made as the result of an isolated venture or a 'one-off' transaction does not preclude it from being properly characterised as income: Myer Emporium (210). Nor is it necessary that the intention or purpose of profit-making is the sole or dominant intention or purpose for entering into the transaction; it is sufficient if profit-making is a significant purpose: see Federal Commissioner of Taxation v Whitfords Beach Pty Ltd [1982] HCA 8; (1982) 150 CLR 355; Federal
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Commissioner of Taxation v Cooling (1990) 22 FCR 42; AGC (Investments) Ltd v Federal Commissioner of Taxation (1991) 21 ATR 1379.

79 The Embleton property was the fourth in a series of residential properties the respondent had purchased, over a relatively short period of time, solely for the purpose of profit-making on resale. There was no other reason for the acquisition and sale of any of the properties. Neither the respondent nor his wife occupied any of the properties and while the respondent envisaged that, like its predecessors, the Embleton property would be let for some months, it is clear that that was simply to allow a period of at least 12 months to elapse from the date of purchase so as to qualify for the discount rate of capital gains tax under subdivision 115A of ch 3 of the ITAA. The earning of rental income was no part of the respondent's purpose in acquiring the property. The respondent's sole purpose in acquiring it, as with each of its predecessors, was to derive profits on its resale. Indeed, as we have said, from 2004 until the accident in May 2006 those profits were the respondent's only form of income, apart from any rental that might have been earned incidentally from letting the properties before their sale.

80 In our view, on the evidence it was not open to the primary judge to find that the early sale deprived the respondent of the discount rate of capital gains tax. His Honour should have found that the proceeds of sale of the Embleton property would have been ordinary income of the respondent for the purposes of the ITAA and, accordingly, the respondent would not have been entitled to the discount rate of capital gains tax on the proceeds of sale even if the property had been sold more than 12 months after its purchase. As the proceeds were taxable as ordinary income under the ITAA, no such discount would have been applicable. It follows that the respondent has suffered no loss because the property was sold less than 12 months after its purchase. We would uphold this ground of appeal.

Summary

81 The respondent is entitled to damages as follows:

Past loss of earning capacity as a tree climber	$30,242.28
Interest on past loss of earning capacity as a tree climber	$907.27

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Future loss of earning capacity	$101,439.20
Past medical treatment expenses and travel expenses	$500.00
Future medical treatment expenses	$2,000.00
Non-pecuniary loss	$45,180.00
Total	$180,268.75

From that sum must be deducted 25% for contributory negligence, resulting in an award of damages in the sum of $135,201.56.

Conclusion

82 We would:

1. allow grounds 1, 2 and 4 of the grounds of appeal;

2. dismiss ground 3;

3. set aside the award of damages made by the primary judge and award damages in the sum of $135,201.56.

MURPHY JA:

Introduction

83 I have had the advantage of reading the reasons for judgment of Buss and Newnes JJA. Their Honours set out much of the relevant background, and the grounds of appeal, and it is unnecessary for me to repeat all that material here. In substance, the respondent (Mr Wilson) was riding a bicycle when he was negligently struck by the appellant's motor car. He suffered injuries to his left shoulder and collar bone. He has ongoing disabilities which preclude him from resuming his pre-accident employment as a tree lopper/climber. I agree with Buss and Newnes JJA in relation to grounds 3 and 4.

84 In relation to grounds 1 and 2 concerning past and future loss of earning capacity, I also agree that error has been demonstrated, but my reasons are different from those of Buss and Newnes JJA, and in consequence I have reached a different view as to the appropriate award of damages. My reasons are as follows.

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Grounds 1 and 2 of the appeal and the error in the court below

85 Grounds 1 and 2 of the appeal are not pellucid in content or scope. Buss and Newnes JJA have set out, correctly in my respectful view, what appears to be the substance of grounds 1 and 2 and the arguments put in support of them. I should, however, make the following additional preliminary observation in relation to ground 1. With respect to past economic loss, the judge found, in effect, that Mr Wilson had taken a break from tree lopping in 2004, and he intended to, and would have, resumed that occupation on 1 August 2006 but for the accident (reasons [50], [63] - [64]). It is not clear to me whether ground 1 purports to challenge this finding of fact. If and to the extent that it does, it should be rejected as the finding was clearly open on the evidence (ts 33, 65, 164 - 165).

86 It is convenient to outline here what I regard to be the fundamental error of the judge in relation to his assessment of lost earning capacity. It concerns his assessment of damages in relation to retained earning capacity.

87 The judge found (reasons [67]):

In the absence of evidence of the earnings Mr Wilson could have derived from the light duty occupations I will assess his retained earning capacity at a percentage of his earning capacity as a contract tree climber as at 1 August 2008 save for the accident: Bowen v Tutte (1990) Aust Torts Reports 81-043; Pene v Murphy [2004] WASCA 103. However, there are a number of factors that would have made Mr Wilson's entry into the job market difficult: his age, his level of education, his communication skills, his lack of experience in the occupations mentioned, his late entry into the employment market, the fact that he would be competing for employment with much younger persons and his disability.

88 Insofar as his Honour prefaced the finding with the words 'In the absence of evidence of the earnings Mr Wilson could have derived from the light duty occupations ...', his Honour appears to have overlooked a considerable body of evidence given by a labour economist, Professor Mulvey, in his report of 16 September 2008 and in his oral evidence in relation to that report. In that regard, his Honour's finding that there was no evidence of that kind is an error. The error has infected his assessment of both past and future loss of earning capacity.

89 This has resulted in an award of damages for those two items which is outside of a sound range. The balance of these reasons will explain why that is so.

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90 In order properly to address grounds 1 and 2, and the debate in the appeal about them, it is necessary to commence with a consideration of the principles concerning loss of earning capacity.

Loss of earning capacity

91 In Australia, a plaintiff is compensated for loss of earning capacity, not loss of earnings: Medlin v State Government Insurance Commission [1995] HCA 5; (1995) 182 CLR 1, 16. The correct question is whether, as a result of the accident, the plaintiff has been rendered less capable of earning income: Medlin v State Government Insurance Commission (17). In determining that question, the court looks at the plaintiff's capacity for work beyond the particular employment in which he or she was engaged at the time of the accident: Medlin v State Government Insurance Commission (17).

92 Earning capacity is, however, an intangible asset which only has a value to the extent to which it may be exploited financially. Consequently, no compensation is payable for loss of earning capacity unless the loss is or may be productive of financial loss: Medlin v State Government Insurance Commission (16, 18); Husher v Husher [1999] HCA 47; (1999) 197 CLR 138, 143. In State of New South Wales v Moss [2000] NSWCA 133; (2000) 54 NSWLR 536 [63] Heydon JA (as his Honour then was) said:

... In truth the assessment of damages for loss of earning capacity in relation to the future in every respect relates to the loss of an opportunity, or, as is now often said, the loss of a chance. The two parts of [the plaintiff's claim] wrongly suggest that one process of analysis is called for where the lost capacity is valued by reference to loss of wages, while another is called for where it is valued by reference to loss of profits. In each the process of analysis is the same: what is the monetary value of the lost chance to exploit the lost - or damaged or removed or amputated - capacity to earn income, by wages or otherwise, in future? ...

93 His Honour observed that there were 'two uncontroversial themes running through the cases relating to the assessment of damages for injury to earning capacity'. One was the desirability of calling evidence of what the plaintiff would have been likely to earn, but for the injury, and what the plaintiff is likely to earn after it. The other is that the failure to call such evidence does not necessarily result in the selection of only a nil or nominal figure as damages for impaired earning capacity [66].

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94 In relation to the first of those themes, his Honour said [67] - [68]:

[I]n relation to the first of these themes, in Paff v Speed(1961) 105 CLR 549 at 559, Fullagar J said that the 'usual method of proving damages under [this] head is by calling evidence to show what the plaintiff could probably have earned during the rest of his life if he had not been injured and what, if anything, he is now capable of earning'. The same is true where the defendant is seeking to demonstrate that the diminution of earning capacity is only partial ...

...

The first theme was stated with the qualification 'in general', because there is authority that in some circumstances over-elaborate evidence is unhelpful. In J K Kealley v Jones [1979] 1 NSWLR 723 at 734-735, Moffitt P said:


'Sometimes, particularly in a jury trial, evidence of some claimed prospective earnings but for injury may distract rather than aid quantification of loss. A jury may well make a better assessment of the loss of a young law student debarred by injury from becoming a barrister by evidence such as in Gilles' case [(1975) 49 ALJR 349] uncluttered by evidence of earnings made by selected leading senior counsel, with or without the aid of statistics as to success and failure rates of students and barristers, where such evidence is led in supposed aid of quantifying the lost opportunity of becoming leading counsel in the foggy future.'

This approach may rest on a general recognition that 'the task of assessing damages in personal injuries cases should be kept as simple as possible': Jongen v CSR Ltd(1992) Aust Torts Reports 81-192 (61,706) at 61,713, per Anderson J.

95 In Medlin v State Government Insurance Commission, McHugh J said (19) that in most cases, it will be appropriate to approach the determination of loss of earning capacity on the basis that the plaintiff is to be compensated to the extent that the loss of earning capacity has resulted in a loss of probable earnings, and a loss of a chance to exploit any residual capacity that would probably not have been exploited if the accident had not occurred, although that approach may mislead when the plaintiff remains in employment following the accident.

96 Also, in Baird v Roberts (1977) 2 NSWLR 389, 397, Mahoney JA (Reynolds & Glass JJA agreeing) said that although the compensation is given for the loss of economic capacity, that loss will often be best quantified by considering what is the relevant result from it; ie, in considering the difference between the remuneration which could have been obtained by the plaintiff in exploiting his or her pre-injury capacity,

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and that which could be obtained by exploiting his or her reduced capacity after the injury, and that such an approach would afford, prima facie, the most direct assistance in quantifying the compensation where the compensation sought is for a reduction, and not for a complete destruction, of the economic capacity of the plaintiff.

97 In relation to the second theme to which Heydon JA referred in State of New South Wales v Moss, his Honour continued [69] - [71]:

The second theme in the authorities was summed up by Reynolds JA in Yammine v Kalway [1979] 2 NSWLR 151 at 155, as follows:

'in seeking to quantify his damages, a plaintiff could be well advised to offer [evidence of wage levels] in many cases; and likewise a defendant, in seeking to cut down the damage, might similarly be well advised to tender such evidence; neither, in the absence of such evidence, could complain, to the same effect, at any quantification arrived at. This, however, is far from asserting that in the absence of such evidence only nominal damages is appropriate … [W]here a plaintiff has suffered a significantly disabling injury which obviously affects the range and nature of the work he can, therefore, perform, a tribunal of fact can, without specific evidence as to what other persons with that kind of disability can earn, make a judgment and assessment, on a percentage basis or otherwise, of the value of the lost capacity.'

Where the plaintiff calls incomplete evidence and there is only a low award for diminution of earning capacity, it is difficult for the plaintiff to complain: Minchin v Public Curator of Queensland[1965] ALR 91 at 93; Giorginis v Kastrati (1988) 49 SASR 371 at 375. But it does not follow that a substantial award in a case where the evidence is incomplete cannot survive appellate attack by the defendant: H Luntz, Assessment of Damages for Personal Injury and Death, 3rd ed (1990) Sydney, Butterworths, at [1.9.28]. This is so for several reasons.

...

Secondly, strictly the issue does not turn on a comparison between what money the plaintiff would have earned apart from the injury and what money the plaintiff will earn after the injury. The compensable loss is not a loss of income but the loss of capacity to earn income in a manner productive of financial loss: Graham v Baker(1961) 106 CLR 340 at 347. The income earned before the injury is relevant, but only as an evidentiary aid in assessing damages for the loss of capacity to earn income: Paff v Speed at 566, per Windeyer J. Evaluation of the worth of a loss of capacity to earn - of a lost chance to earn - is of its nature a more imprecise inquiry than calculation of a lost income. It rests on the hypothesis - that the plaintiff will have undiminished capacity - which has been rendered false by events. It does not depend on calculating the income from a particular

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career which is no longer possible, but in calculating the damage to a capacity to carry on various careers. It is an exercise in estimation of possibilities, not proof of probabilities. H Luntz, Assessment of Damages for Personal Injury and Death, 3rd ed, at 91 [1.9.18], said: 'it is not necessary for the plaintiff to establish the future loss with the same degree of precision as the present and past loss … The court is really being asked to estimate as best it can the future effect of the injuries from which the plaintiff has been proved to be suffering as a result of the defendant's wrongful act'.

In Malec v J C Hutton Pty Ltd(1990) 169 CLR 638 at 639, Brennan J and Dawson J said: 'the ascertainment of earning capacity involves an evaluation of possibilities, not establishing a fact as a matter of history'. They approved Lord Diplock's statement in Mallett v McMonagle[1970] AC 166 at 176: '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 …'. The majority (Deane J, Gaudron J and McHugh J) in Malec v J C Hutton Pty Ltd said (at 643) that when the law takes account of future or hypothetical events in assessing damages, it can only do so in terms of the degree of probability of those events occurring in a range from just above the speculative to just below the certain. The inquiry - the process of estimation of possibilities - is thus an imprecise and indeterminate one to be carried out within very broad parameters. ... Lord Diplock described the factors underlying the assessment of damages for diminished earning capacity as 'matters of prophecy or judicial guesses' in Paul v Rendell (1981) 55 ALJR 371 at 376; 34 ALR 569 at 578. The English position was summarised thus by Lloyd LJ in Foster v Tyne and Wear County Council[1986] 1 All ER 567 at 570:


'when it comes to estimating loss of earning capacity, there is no such thing as a conventional approach; there is no rule of thumb which can be applied. It would be so much easier if there were. But there is not. In each case the trial judge has to do his best to assess the plaintiff's handicap, as an existing disability, by reference to what may happen in the future. As has been said so often, that is necessarily a matter of speculation; it is necessarily a matter of weighing up risks and chances in all the circumstances of a particular case. The very fact that the approach must necessarily be so speculative means, of course, that the occasions on which this court will feel justified in interfering with a judge's assessment will be few and far between, for there is no established range or standard against which to measure the judge's award.'

98 The plaintiff bears the overall burden of proving its loss: Todorovic v Waller [1981] HCA 72; (1981) 150 CLR 402, 412 (Gibbs CJ & Wilson J). Further, as damages for loss of earning capacity can only be
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awarded to the extent that the loss produces, or might produce, financial loss, if, notwithstanding a diminution or loss of earning capacity, the contract of employment and right to wages continue unaffected, by way of sick pay entitlements or otherwise, it cannot be said that the diminution or loss of earning capacity is or may be productive of financial loss: Graham v Baker [1961] HCA 48; (1961) 106 CLR 340, 347 (Dixon CJ, Kitto & Taylor JJ); Medlin v State Government Insurance Commission (18) (McHugh J).

99 Although the ultimate legal onus is on the plaintiff to prove his or her loss, an evidentiary burden may shift to the defendant in the course of the trial. In Baird v Roberts Mahoney JA said (398):

The overall onus of proof of loss lies upon the plaintiff. But, in cases where compensation is to be assessed for the reduction of economic capacity, this must not be confused either with the question of where the practical burden of producing evidence lies at any particular point in a trial, or with the question of what evidence is apt to be sufficient to produce in a trial judge, or insofar as it may be relevant, in this Court, the appropriate satisfaction as to the existence of such loss, or element of loss, as the party seeks to establish.

100 In relation to onus, Ipp JA, Beazley and Basten JJA agreeing, in McCracken v Melbourne Storm Rugby League Football Club Ltd [2007] NSWCA 353; (2007) Aust Torts Rep 81-925 [71] - [72], said:

Sugerman JA explained this in detail in Adams v Ascot Iron Foundry Pty Ltd (1968) 72 SR (NSW) 120 (at 132 to 133):

'In many, if not most, cases of damages for personal injuries, damages are awarded in respect of a lost or diminished earning capacity of the plaintiff. In such cases loss of earnings in the past and prospective loss of earnings in the future furnish a guide to the measure of such damages. A plaintiff is frequently said by medical evidence to be unfit as a result of his injury for his former employment, but to be capable of doing other forms of work, eg light work with or without particular qualifications. If in such cases a question arises of the plaintiff’s ability to find such other forms of work the problem is not one of mitigation of damages. It is really the plaintiff who is seeking to increase damages by establishing that he has been unable to obtain and in the future may not be able to obtain, or may only be able to obtain intermittently, work of the only kind of which he is capable. In this respect the onus of proof in the sense of the onus of satisfying the jury rests upon the plaintiff as part of the general burden which lies upon him of proving the extent of the damage he has suffered by reason of the injury.

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In some cases it is the defendant who seeks to introduce evidence by way of establishing that a particular employment, usually with the defendant himself as the previous employer, within the capacity of the plaintiff is available to him. The present is an example of such a case. In such cases the defendant is really denying, according to the circumstances, that the plaintiff’s incapacity is as extensive as he claims or that his loss of earning capacity is aggravated by the impossibility of him obtaining employment within the limited capacity remaining to him.'

In Medlin v State Government Insurance Commission, McHugh J (at 21) said:

'In Adams v Ascot Iron Foundry Pty Limited, Sugerman JA correctly pointed out that, where a question arises as to whether a plaintiff could have obtained employment that was within his post-accident capacity, the question is not really one of mitigation of damages. The plaintiff must prove that such employment is beyond his or her capacity ‘as part of the general burden which lies upon him of proving the extent of the damage he has suffered by reason of the injury.'

101 Where the plaintiff has a residual earning capacity in some occupation other than the one he or she followed prior to the accident, the court has to consider not only what the plaintiff could earn in such an occupation, but the availability of such other work to the plaintiff, having regard to the plaintiff's injuries, circumstances, antecedents and the state of the labour market: Van Velzen v Wagener (1975) 10 SASR 549, 550 (Bray CJ).

102 In relation to the shifting of an evidentiary onus, the appellant referred to Thomas v O'Shea (1989) Aust Torts Rep 80-251 where Malcolm CJ and Wallace J said (68,701):

The question remaining is what was the appellant's residual earning capacity, if any. This was clearly a case where, as the learned trial Judge found, the appellant had lost the earning capacity he had before the accident. The legal onus of proof of loss of earning capacity rests, of course, on the plaintiff, but once the plaintiff has proved that he has lost his pre-accident earning capacity and has been unable to find alternative employment, or that his condition has prevented him from finding alternative employment, an evidentiary burden is cast on the defendant to show what alternative employment opportunities were open, including the state of the labour market and the likely earnings: Arthur Robinson (Grafton) Pty. Ltd. & Anor v Carter (1968) 122 CLR 649 at p. 657 per Barwick CJ; Van Velzen v Wagener (1975) 10 SASR 549 at p. 550 per Bray CJ; and Linsell v Robson (1976) 1 NSWLR 249 at pp. 253-254 per Hutley JA; and at pp. 254-255 per Glass JA.

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103 The appellant placed particular reliance in the above passage on the words 'the plaintiff has proved that he has lost his pre-accident earning capacity and has been unable to find alternative employment' (emphasis added) and submitted, in effect, that there could not be a shift in the evidentiary onus until the plaintiff had proved that he had taken steps, unsuccessfully, to obtain alternative employment, and that without such proof, the plaintiff would be confined to nominal damages. I do not accept that submission. In my view, their Honours were referring to situations which provided examples where the evidentiary onus could shift - see Setton v Eves [2006] WASCA 3 [27] (McLure JA). See also Linsell v Robson (1976) 1 NSWLR 249, 254 - 255 (Glass JA); Baird v Roberts (398); Potter v State Government Insurance Commission (1990) Aust Torts Rep 81-015, 67,701; Luntz H, Assessment of Damages for Personal Injury and Death (2002, 4th ed) [1.9.20]. I would not see the above passage in Thomas v O'Shea as being prescriptive of the way in which the plaintiff must discharge his or her legal burden. In that regard, I would respectfully agree with what was said by Moffitt P in Kealley v Jones (1979) 1 NSWLR 723, 733 concerning Hutley JA's analogous comments in Linsell v Robson (cited by Malcolm CJ and Wallace J in the passage above):

The principles contained within each of the decisions in Bowen v Tutte and Wright v Shire of Albany are important statements by the FullCourt

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of the appropriate basis upon which to assess damages for loss ofearning capacity in certain cases, but neither case suggests that these arefixed and inflexible principles upon which damages are always to beassessed in claims for loss of future incapacity. (emphasis added)

The judge's findings concerning Mr Wilson

121 It is appropriate next to note the judge's findings as to Mr Wilson's background, skills, injuries and disabilities.

122 In relation to Mr Wilson's education and skills, the judge found (reasons [23], [36], [67]), in effect, that:

(a) Mr Wilson was nearly 39 years of age at the time of the accident and was 42 years of age at the time of trial;

(b) he had left school after the first term of year 11;

(c) he had worked in a cabinet making business for 12 months and then undertook a panel beating apprenticeship for four years and then worked in that industry for a further five to six years;

(d) he thereafter commenced a lawn mowing and landscaping business with one of his brothers, which turned into a tree lopping and garden cleanup business in which he worked for eight to nine years;

(e) he had no clerical or computer skills;

(f) he did not have good communication skills.

123 In relation to his continuing injuries and disabilities, the judge found (reasons [2] [22], [81], [83]), in effect, that:

(a) Mr Wilson still had some restriction of movement in his left shoulder and continued to feel tender across the collarbone;

(b) there was only a certain amount of weight that Mr Wilson could bear before he experienced pain;

(c) he suffered related headaches and disturbed sleep;

(d) he would continue to require ongoing conservative treatment for the cervical spine such as exercises, strengthening and swimming, and there would be some continuing need for analgesics and occasional attendance on his medical practitioner.

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124 His Honour also found Mr Wilson to be 'an honest and reliable witness who was doing his best to explain his situation' and that he had intended, but for the accident, to recommence tree lopping work on 1 August 2006 (reasons [63], [64]).

125 In relation to residual earning capacity, the judge found, in effect, that Mr Wilson retained a capacity for full-time employment for work other than a tree climber, in certain types of employment involving light duties (reasons [34], [66]).

126 The judge also found (reasons [49]) that Mr Wilson had failed to mitigate his past economic loss by returning to some form of remunerative employment in a lighter duty occupation from 1 August 2006.

The evidence concerning employment and employment opportunities

Evidence concerning employment for light duties

127 As noted earlier, the judge appears to have paid no attention to the evidence concerning the potential availability for light duties employment and the remuneration levels associated with such employment.

128 Evidence was led from Professor Charles Mulvey, a labour economist, in relation to aspects of the labour market concerning light duties. Professor Mulvey's report was dated 16 September 2008, and addressed to the appellant's solicitors, although his evidence was led by Mr Wilson's counsel. In that report, Professor Mulvey set out, in effect, the results of certain searches he had made and statistics he had ascertained in connection with the availability of certain jobs in Western Australia and the income associated with such jobs.

129 His report covered the following occupations:

• driver

• bench process worker

• metal fabrication worker

• wood fabrication worker

• furniture polisher

• sales representative

• sales assistant

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• storeman

• transport clerk

• surveyor's assistant

• hardware store sales person

• security guard

130 As to drivers, he said that a Federal department website rated job prospects as 'average'. He also said:

In recent years, bicycles have been increasingly used to deliver documents and small parcels in and around the city area as they are faster, cheaper and more convenient than the traditional van.

Job opportunities depend on the number of peak business periods of the year, changes in technology affecting delivery methods e.g. electronic information transfer, changes in transport policy and systems, and the cost of couriers relative to other delivery methods.

...

My view is that a suitable person will find employment as a Delivery Driver within a reasonable period of time so long as they are willing to work throughout the metropolitan area.

Persons seeking employment as a Courier Driver with a company which supplies the vehicle face poor employment prospects and must expect to have to engage in job search over a much longer period of time before finding suitable employment. If, in addition, the work sought is of a light nature, opportunities are quite limited. Such jobs do exist - such as couriers with pathology companies - but vacancies for them are very seldom advertised. Accordingly, a person seeking a light Courier role, and particularly if they require the employer to supply the vehicle, must expect to search for a considerable period of time before finding suitable employment. (emphasis added)

131 As to bench process workers, he also referred to the Federal department's website as disclosing that job prospects were 'average'. He also said:

Process Workers working at a bench are likely to be engaged in light assembly work. In particular, electronic assembly work is carried out at bench.

...

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Many product assembly jobs involve heavy lifting and are physically demanding so that we concentrate our research on employment availability to light assembly positions. The assembly work involving the least lifting requirement is light assembly work such as electronic assembly.

...

We assessed the vacancies overall to determine whether they might constitute Light Assembly work. In our view, based on the information provided, roughly around 20%-25% of the advertised vacancies appeared to constitute Light Product Assembly work.

Previous searches of all these media have located a reasonable number of vacancies on a regular basis for Product Assemblers in general but we only encounter a small number of positions which clearly indicate that they are suitable for light Product Assemblers. However, up to around one quarter of all vacancies scrutinised may turn out to be suitable for a worker capable of only light duties. Moreover, there appears to be a constant demand for Electronic Assemblers in Perth and that is recognised to be particularly light work.

Given the number of currently advertised positions available for Product Assemblers/Process Workers generally in the Perth metropolitan area, a suitable person seeking such employment ought to be able to secure employment within a reasonable period of time in the Perth metropolitan area. Employment options are likely to be rather more limited if the candidate is seeking employment in Light Assembly Work only throughout the Perth metropolitan area, but, nevertheless, such a candidate ought to be able to find employment within a reasonable period of time. (emphasis added)

132 As to metal fabricators, he said that their employment prospects for 2011-12 were expected to be slight, but added:

Skilled tradesmen are in particularly short supply in WA presently. Metal Fabricators is an occupation officially designated as being subject to a national labour shortage. There is currently a very high level of vacancies for Fabricators in Perth. In my opinion a suitably qualified worker will find employment as a Fabricator in WA without difficulty in Perth.

133 As to wood fabricators, he said:

There are opportunities for self-employment, but set-up costs can be considerable, depending on the machinery used.

The Job Outlook website of the Commonwealth Department of Education, Employment and Workplace relations rates job prospects for Wood Machinists and Turners as AVERAGE.

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We searched the JobSearch network on 16 September 2008 and found no vacancies for Wood Machinists in WA.

A search of the West Australian employment classifieds on 13 September 2008 located two advertised vacancies for Wood Machinists in Perth. In previous issues we have located as many as five advertised vacancies for Wood Machinists in Perth.

Welocated only twoadvertised vacancies for Wood Machinists in Perth in the last week. This is a small number of vacancies but this is a small occupation. In my opinion a suitable and suitably qualified worker ought to be able to find employment as a Wood Machinist in Perth within a reasonable period of time.

134 As to furniture finishers, he said:

Employment for Furniture Finishers to 2012-13 is expected to DECLINE. Employment in this very small occupation (112 in WA in August 2006) rose moderately in the past five years, and fell in the long-term (ten years), but with very small occupations employment estimates can fluctuate.

Furniture Finishers have a relatively low proportion of full-time jobs (28 per cent)

...

This is a very small occupation in Perth. In my opinion, there will be a regular trickle of advertised vacancies in Perth. A suitable candidate who searches proactively ought to be able to secure employment within a reasonable period of time.

135 As to sales representatives, he said:

Employment growth for Sales Representatives to 2011-12 is expected to be SLIGHT. Employment in this very large occupation (8,286 in WA in February 2007) rose slightly in the past five years, and remained relatively steady in the long-term (ten years).

...

There is a large and varied flow of advertised vacancies for Sales Representative positions in this occupation group in Perth these are geographically distributed throughout the Perth metro area. Since selling skills are frequently the most sought after quality mentioned in the advertisements, a person with such skills and willing to turn their hand to selling the products and services currently in demand ought to be able to find employment within a reasonable period of time.

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136 As to sales assistants, he said:

The Job Outlook website of the Federal Department of Employment and Workplace Relations rates job prospects as GOOD.

Employment growth for Sales Assistants to 2010-11 is expected to be STRONG. Employment in this very large occupation rose moderately in the past five years, and in the long-term (ten years).

Sales Assistants have a relatively low proportion of full-time jobs (34 per cent). For Sales Assistants working full-time, average weekly hours are 38.8 (compared to 42.1 for all occupations) and earnings are low - in the second decile.

...

Juniors and those seeking only casual/part-time work as Sales Assistants face very good employment prospects and may expect to find work within a short period of time. Adults seeking full-time/permanent work as Sales Assistants also face good prospects but may have to undertake job search over a longer period of time before securing suitable employment. (emphasis added)

137 As to store persons, he said:

Employment growth for Storepersons to 2011-12 is expected to be MODERATE. Employment in this very large occupation (20,064 in WA in February 2007) rose very strongly in the past five years, and rose strongly in the long-term (ten years).

Storepersons have a relatively low proportion of full-time jobs (59 per cent). For Storepersons working full-time, average weekly hours are 38.1 (compared to 41.8 for all occupations) and earnings are below average - in the third decile.

Storepersons are employed across several industries including: Supermarket and Grocery Stores; Storage and Department Stores.

The Job Outlook website of the Federal Department of Employment and Workplace Relations rates job prospects for Storepersons as AVERAGE.

...

There are very high levels of currently advertised vacancies in Perth. These levels of advertised vacancies indicate a very good current demand for Storepersons throughout the Perth metro area. Accordingly, a suitable person seeking employment as a Storeperson ought to be able to secure employment within a reasonable period of time. (emphasis added)

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138 As to transport clerks, he said:

A small number of vacancies for Transport and Despatch Clerks arise on a reasonably regular basis in Perth. Experience is often mentioned as essential in advertisements. My view is that it is likely that an experienced worker will find employment within a reasonable period of time but that a new entrant may have to wait for some time before finding employment. Experience in the transport industry will generally be an advantage.

However, a person willing to contemplate working as a clerk in related occupations such as import/export, freight forwarding or stock control faces brighter labour market prospects. Freight Forwarding Clerks are in particularly high demand presently and a number of trainee positions are also available.

139 As to survey assistants, he said:

This is a very small occupation with only occasional vacancies arising in WA. In my opinion a person must expect to have to wait for some time before securing employment as a Survey Assistant in the Perth metropolitan area but prospects are better in the mining industry in the State's north-west.

140 As to hardware sales assistants, he said:

The Job Outlook website of the Federal Department of Employment and Workplace Relations rates job prospects as GOOD.

Employment growth for Sales Assistants to 2010-11 is expected to be STRONG. Employment in this very large occupation rose moderately in the past five years, and in the long-term (ten years).

Sales Assistants have a relatively low proportion of full-time jobs (34 per cent). For Sales Assistants working full-time, average weekly hours are 38.8 (compared to 42.1 for all occupations) and earnings are low - in the second decile.

...

Two-thirds of all Sales Assistants are part-time, one-third are under 19 years of age, a high proportion are casuals and 70 per cent of Sales Assistants are female. Juniors and those seeking only casual/part-time work as Sales Assistants are best placed to secure whatever work comes available.

Our view is that there will be a steady flow of vacancies for Sales Assistants in hardware and related areas in Perth. Accordingly, suitable candidates seeking employment as Hardware Sales Assistants may expect to find work within a reasonable period of time so long as they are willing

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to consider positions in all hardware, home improvements and related areas. (emphasis added)

141 As to static security officers, he said:

The Job Outlook website of the Commonwealth Department of Employment and Workplace Relations rates job prospects for Security Officers and Guards as GOOD.

Employment growth for Security Officers and Guards to 2010-11 is expected to be STRONG. Employment in this very large occupation rose strongly in the past five years, and in the long-term (ten years).

...

Static security officers are in reasonably high demand and a suitable and suitably qualified person seeking work in that area may expect to find employment within a reasonable period of time. However, static security positions generally require the incumbent to be able to apprehend offenders. A person seeking a position in Perth which involves no ultimate requirement to apprehend offenders faces limited job prospects and must expect to have to search for a considerable period of time. Control Room positions are less common but do not require the operator to engage in any physically demanding activity. Control Room Operator vacancies do arise in Perth from time to time so that a suitable person seeking such work ought to be able to find a position but may have to search for an extended period of time before being employed.

142 In giving oral evidence, Professor Mulvey said:

Yes. Okay. I've just got a couple of questions for you about that report. You'd agree, wouldn't you, that all things being equal, new entrants to a particular type of work encounter more difficulty than those who were experienced in doing that type of work?---Yes.

...

And are there any statistics available about the success that people have moving into light - lighter work, generally lighter work, after working until their early forties say in heavy manual labour?---Not that I'm aware of.

Okay. Are there any statistics which were published or are available concerning the success rate of people who declare some sort of physical infirmity when they - when they apply for any kind of work?---Not that I'm aware of.

Yes. And the average weekly earnings in the particular occupations that you've outlined in what I might call the second report, the long report, that's presumably averages over - over all ages and all experience within the category of employment; is that correct?---That's correct.

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And you'd agree that anybody, any particular person, would have to be - sorry, I take that back. Any population that comprises those statistics, there'll be clearly some who earn less and others who earn more than the average?---Yes.

And in general terms and I say general terms, the more experienced long term workers in any particular area or type of work are paid more than new entrants?---Yes, although in the older age groups say beyond 45, 50 - - -

Yes?--- - - - earnings tail off again because people tend to work shorter hours and so on in those age groups.

Each type of work has varying numbers of people who compete for the number of jobs available; is that correct?---It is.

Right, clearly. And in recent times there's been quite an economic downturn; is that correct?---There has.

Right. In general terms, once again, would that mean that new entrants to a particular type of work would be less able to obtain work?---Yes, that is correct.

In a general type position?---Yes.

...

... If you were to take a willing albeit inexperienced workman or woman for that matter, who was reasonably intelligent, willing to work and try hard, he would catch up, wouldn't he or she?---Depends on the occupation. The occupations where experience would count least are those low skilled manual occupations basically.

The types of occupations set out in the first page of your report?---Yes.

Of 16 September to Talbot Olivier; is that right?---Well, not all of them. Some of those are actually quite skilled. Like a fabricator, for example, requires an apprenticeship of four years to - - -

Well, take a fabricator who learnt the ropes quickly, he'd make up the leeway, wouldn't he?---No.

No?---A metal fabrication worker requires a four-year apprenticeship as a boilermaker/welder.

I see. All right. For those jobs that don't require too much in the way of apprenticeships and pre-training, as it were, in the event that it's more manual or less skilled type labour, would it be the case that you would expect a person, the new entrant into the general area, if willing and able and so on, pick up the job pretty quickly?---Yes, I think that's right. I actually could produce data on that because I have the age distribution of earnings with me.

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...

Now, you've told us there's been a downturn. Has that affected the rates of - or the availability of jobs of the type mentioned in the report which is exhibit - we know is exhibit P4?---Yes, it has. It's dramatically affected it.

When would you say that that downturn first started to bite?---The - it most dramatically came to my attention after the Christmas/New Year break. I started to notice, because I'm - I'm surveying advertised vacancies across a wide range of jobs on a daily basis, and I noticed that there were very significantly lower rates of advertisements in the post-Christmas/New Year period.

I see. Well, now, take the period between, say, January 2006 and December 2008, that is, before you noticed this bite, downturn. Wouldn't you say that the contents of this report, exhibit P4, would apply to the whole of that period, in general terms?---In general, yes. This - this report was written in the middle of September, I think, 2008.

Yes?---So there was only another couple of months before my breakpoint in the - - -

But how about before it?---Before it, the - up until then, the labour market was extraordinarily strong in 2006, 2007. There was a slow deterioration during 2008 and then a dramatic deterioration in the early part of 2009.

143 It is apparent that Professor Mulvey's evidence was of a fairly general nature. Professor Mulvey did not purport to take into account in preparing his report, other than insofar as it was directed in general to light duty occupations, Mr Wilson's individual circumstances with respect to his age, his work history, his educational and other background, his communication skills and his ongoing disability, including problems with headaches and disturbed sleep.

144 It is also apparent from Professor Mulvey's evidence that the employment market for light duty work is, in general terms, fairly broad and reasonably accessible, although there are real risks to new entrants in locating and sustaining full-time employment. The most likely prospective occupations for someone of Mr Wilson's qualities and experience would be a driver, bench process worker, storeman or sales assistant. Even with respect to those occupations, finding and sustaining full time employment, particularly over a long period of time, could not, on Professor Mulvey's evidence, be assured.

145 As to the remuneration with respect to those occupations, Professor Mulvey gave evidence of gross income which, when adjusted for tax, may be summarised as follows:

Other Parts: Pages 51 to 58

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