Morphett, D. v Commonwealth of Australia

[1989] FCA 219

JUDGMENT NO. .&r?~84

CATCHWORDS

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Damages - Measure and remoteness of damages in actions for tort - Measure of damages - Personal Injuries - Loss of earnings and earning capacity - In general - Effect of contingencies - Degenerative condition preceding commission of the tort.

Maylene Hugo Evans v. Adam Pilarski (Full Court, Federal
Court of Australia, 3 June 1988, unreported)
Burnicle v. Cutelli [l9821 2 N.S.W.L.R. 26

Paul v. Rendell (1981) 34 A.L.R. 569

DALLAS MORPHETT V. COMMONWEALTH OF AUSTRALIA

ACT G52 of 1988

24 Aprll 1989

Jenkinson, Neaves and Miles JJ.
Canberra

IN THE FEDERAL COURT OF AUSTRALIA )

AUSTRALIAN CAPITAL TERRITORY 1

) No. ACT G52 of 1 9 8 8

DISTRICT REGISTRY	1 \
GENERAL DIVISION	1

ON APPEAL FROM THE SUPREME COURT OF

THE AUSTRALIAN CAPITAL TERRITORY

BETWEEN: DALLAS MORPHETT

ADDellant

AND :  COMMONWEALTH OF AUSTRALIA

Res~ondent

MINUTE OF ORDER

THE COURT	: Jenkinson, Neaves and Miles JJ.
DATE OF ORDER	: 24 April 1989
WHERE MADE	: Canberra
THE COURT ORDERS THAT:

1 .	The ap~eal	be dismissed with costs.
Note: Settlement and entry of orders is dealt with in Order IN THE FEDERAL COURT OF AUSTRALIA )	3 6 f	the Federal Court Rules.

1

AUSTRALIAN CAPITAL TERRITORY	j
) No. ACT G52 of 1988
DISTRICT REGISTRY GENERAL DIVISION

ON APPEAL FROM THE SUPREME COURT OF

THE AUSTRALIAN CAPITAL TERRITORY

BETWEEN: DALLAS MORPHETT

Appellant

AND :  COMMONWEALTH OF AUSTRALIA

Respondent

CORAM: Jenkinson, Neaves and Miles JJ.

PLACE: Canberra

DATE :  24 April 1989

THE COURT:

This is an apoeal by a olaintiff aqainst the amount of damaqes awarded to him on 19 October 1988 by the Suoreme Court of the Australian Caoital Territory in an action for damaaes for personal 1n)uries aqainst hls em~loyer the

Commonwealth of Australia.

The total award of damaqes was made up as follows:

General damaaes $ 5 0 , 0 0 0 . 0 0

Past economic loss S 9 0 , 0 0 0 . 0 0

Fox V. Wood component	S 13 ,160 .30
Out-of-~ocket expenses	$ 22 ,511 .06

Future economic	loss	$140 ,000 .00
Total	$315 ,671 .36

The appeal is confined to a challenge to the award for past economlc loss and future economic loss.

The trial judge's findinqs of fact are not disputed and may be shortly stated.

The appellant was born on 16 October 1943 at Junee in New South Wales. He has had little formal education and is practically illiterate. His only work experience has been as a farm labourer and as a plant oDerator. He worked in that latter capacity when he joined the employ of the respondent in 1969.

The Incident which save rise to the ao~ellant's injury occurred on 26 June 1978. He was drlvinq a barkhoe in reverse when its wheels sank into soft qround causlnq a Jarrinq inlury to his sDlne.

He had to be assisted from the seat of the backhoe and was taken by ambulance to the Royal Canberra HosDital where he was examlned and dlscharqed on the same day. Later that day he reported to his qeneral practitioner, Dr Wishart, at the Narrabundah Health Centre. He resumed work next day.

The a~pellant lost no further time from work until November 1978 but during that perlod he complained of pain	in the lower back ~artlcularly when asked to carry out
heavier duties. Durinq this oerlod a number of minor work related incidents exacerbated his back condition. Eventually he went off work on 30 November 1978 untll 30 January 1979. He resumed duties until 26 March 1980 when he went off work aqain and was referred to Dr Roebuck, an orthopaedic surqeon. Dr Roebuck performed a dlsc excision ooeration at the L4/5 level on 5 June 1980. The appellant remalned off work until 3 October 1980 . Thereafter the appellant resumed llqht duties wlth the respondent, workinq as a courler or messenqer and makinq UD stattlnery orders. His back continue3 to qlve hlm trouble however and he went off work for a perlod of about a fortnlqht in February
1 9 8 1 . He then resumed work, this time of a very llqht clerical nature. He was not used to thls sort of work. He did not llke it and it caused hlm a certaln amount of loss of self-esteem. However the aouellant continued in that
work untll 17 March 1 9 8 4 .
In the meantlme the auuellant was seen by Dr Gytls Danta who in a reuort dated 9 December 1980 exuressed the view that, whllst the auuellant had sraniflcant dlsc dlsease, much of his uain was attributable to a "mechanical uroblem". In early 1 9 8 1 the a~uellant was sublected to an eoldural inyection which aave some temDorary rellef. That procedure was repeated in May 1 9 8 1 , but the apuellant's
complaints of pain continued. Dr Danta then referred the
apoellant to Dr Chandran, a neurosurqeon. Dr Chandran
the aooellant was sufferlna from a mlld disability exoressed the vlew in a reuort dated 10 Sentember 1 9 8 1 that
restrlctlnq hlm from carrylnq out heavy work but uermittinq hlm to do the sort of work he was in fact dolnq. The ao~ellant's continued comulalnts caused Dr Chandran to carry out a procedure known as radiofrequency coaqulatlon of the facet nerves of the lumbar spine. This orocedure qave some temporary relief in the soine, but the apoellant was troubled with stiffness.in the riqht leq and weakness in the riqht hip. A lumbar corset was prescribed which aqain qave partial rellef. The appellant's overall condition, however, did not improve. His domestic situation worsened and there

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was a temporary separation between hlm and hls wife. He
received some treatment from Dr GuDta, a psychiatrist.

Dlscoqrams taken by Dr Chandran in late 1982 and February 1984 were somewhat inconclusive but Dr Chandran decided to recommend an ooeration to fuse the soine at the L4/5 level and decornoress the nerve roots. That operation was carried out on 12 Aorll 1984. Dr Chandran thouqht at first that there was sianificant imDrovement but this turned out not to be the case. The apoellant did not resume work after that ooeration. Some tune thereafter the aopellant was referred to Dr Alastalr Robson, neurosurqeon, by Dr Sanaster, who by that tlme had become the ao~ellant's

qeneral practitioner. Dr Robson had seen the aopellant on earlier occasions on behalf of the resoondent, but from November 1986 onwards he took over the manaqement of the treatment of the aopellant's spinal condition. Dr Robson	expressed the vlew, which his Honour accepted, that the	aopellant's contlnuinq symotoms and disability resulted from
the unsuccessful spinal fuslon. Dr Robson recommended further bone qraft and this was carrled out on 25 Auqust
1987. The later ooeration achieved a measure of success.
There is solid fusion in the area of ooeration, but the apoellant continues to have Intermittent pain in his lumbar splne.
Some time before t h e hearinq in the Supreme Court the appellant and his wife moved to Tuross Heads where his wlfe is in employment as a child care attendant. His Honour
remarked that the aooellant leads "a very careful non-stressful exigtence". He continues to take pain-killinq medication. Activlty of a moderately heavy nature causes low back paln whlch can be severe for ~ e r l o d s of uu to a week.
In addition to the appellant's physlcal condition, he has suffered from oerlods of depressive illness from tlme to time and the trlal judqe found the appellant to be "stlll rn an emotional lablle state, which is not altoqether surorlsinq havinq reqard to the hlstory of thls litlqatlon". The trial judqe found that the appellant was "not a particularly impressive wltness" and tended to
rationalise and reconstruct events. His Honour found that
the apoellant's symutoms and dlsablinq back condltlon over the years and at the tlme of the hearlnq were causally connected to the inlury of 26 June 1978, and thls flndinq was not challenqed by the respondent.
It was agreed between the parties that the loss of earnlnas resultinq from the total absence from work from the date of injury untll the hearinq was S99,006.21. On thls issue hls Honour held as follows:

"On the evidence I can see no basls for not acceotlnq that all oast periods of incauacity have been productive of waqe loss and are causally related to the Injury sustained by the plaintiff as a result of the neqliqence of the defendant on 26 June 1978. Accordinqly, I accept the sum of $99,006.21 for past net wage loss. However, I reduce that fiqure to some extent to

take account of oast vicissitudes and reduce it

to the fiqure of S90,OOO."

For the puroose of assesslnq the value of future loss
of earninq caoacity, it is not dlsouted that hls Honour

correctly took a s a basls the current net weekly waqe for a

com~arable emoloyee of $385. His Honour stated further:

.,

.. . . . the olalntiff would have continued in his

emoloyment sublect to the vicissitudes of llfe to
aqe 65."

Hls Honour then ap~lled the three percent dlscount tables to the net weekly waqe of $385 which ylelded a Dresent value for future loss of about $280,000. His Honour then concluded as follows:

"The normal a~proach in assesslnq damaqes for loss of earnlnq caoacity would be to discount the ylelded sum by about 15 per cent and to take account of the vlclssitudes of llfe. I do not think that would be a reasonable a~proach in thls case because the olalntiff will not be totally and oermanently incapacitated for the rest of hls assumed workinq life. In my ludqment he now has a caoaclty for liuht oart-tlme work. That caoaclty is llkely to lncrease over the next five years as he adlusts to the ohysical consequences of the second fusion ooeratlon on 25 Auqust 1987, and the emotional rellef of havinq this unfor- tunate chapter of litiqation resolved in hls favour. It seems reasonable to me to allow for the vlclssltudes of llfe and the aforementioned

a fair measure of his loss of earninq caoacity,	factors by adootlnq about half the yielded sum as
that is $140,000." The word "and" aooearlnq in the first sentence apoears

to be superfluous and unintended.

It was submitted on behalf of the appellant that hls Honour was in error in taklnq one half of the sum of $280,000 to remesent the "fair measure of his loss of earninq capacity". It.was submitted that the conventional reduction of a capital sum arrived at by assessinq the present value of a continuinq loss for a qiven period into the future is flfteen percent (Maylene Huqo Evans v. Adam Pllarski (Full ~:urt, Federal Court of Australia, 3 June 1988). The conventional dlscount should be departed from only for qood reason (Burnicle v. Cutelli [l9821 2 N.S.W.L.R. 26 at 30 per Glass J.A.). It was submitted that there was no justification for the trial ludqe increasinq the reduction for vicissitudes to one half.

However, in our view, a proper readlnq of his Honour's

judqment indicates that the reduction by one half of the

capital sum representinq the present value of the continuing loss was not slm~ly a reduction for what is reqarded as the ordinary vicissitudes and uncertainties of human llfe. His Honour s~ecifically drew attention to what he saw as the appellant's demonstrated caoacity for work by the time of the hearinq. Hls Honour further found that that capacity was likely to increase in the future, particularly when the

the reduction by one half was to allow for "the vlcissltudes	strain of litiqation ceased. Indeed, hls Honour said that
of life - and the aforementioned factors" (our emphasis).
An award for loss of earninq capacity, particularly loss of earninq capacity in the future, is notoriously
difficult to make with any precision, and it is well
acknowledqed that there is no exact mathematical formula that may be applied or should be a ~ ~ l i e d to every case. Moreover, the assessment of the value of future loss involves a double exercise in the art of orophesylnq not only what the future holds for an injured plaintiff but also what the future would have held for him if he had not been
injured: Paul v. Rendell ( 1 9 8 1 ) 34 A.L.R. 569.
The adequacy or otherwise of his Honour's award in this case may be tested by approachinq the question in a different way.
AcceDtlnq that fifteen Dercent is the conventional reduction for the ordlnary vicissitudes of life, the net result in this case was that his Honour discounted the award for future economic loss by a further thlrty-five oercent in the liqht of what his Honour saw was the a~oellant's likely earninq capaclty in the future. It was submitted on behalf of the ao~ellant that, in the llqht of his Honour's findlnq that the ap~ellant had been totally incapacitated for all work for the several years immediately orecedlnq the hearinq, it was not open to hls Honour to 40 on to conclude that the appellant had a capacity for work at the time of the hearlnq, a capacity which was llkely to increase. More particularly, it was submitted that it was not oDen to his Honour to reqard the a~pellant as likely to recover an income-earninq capacity of more than one third of his
caoaclty at the time of injury.
There is some force in that arqument. Even allowinq for the advantage enjoyed by the trial ludqe in seeinq and hearinq the aopellant, it does seem unlikely that the appellant would recover to the extent that he would be able to command thirty-five percent of his re-injury earninq capacity, ~articularly bearing in mind his lack of skills and work experience apart from labourinq and operating heavy plant, activities which are still closed to hlm. The menial clerical duties which he has shown to be wlthin hls physical capacity are no lonqer available to him within the service of the Commonwea'lth. A few weeks before the hearinq the Commonwealth proposed that the aooellant be retlred from the
Australian Public Servlce "on the qrounds of invalldlty".
What emoloyment ~ 0 S ~ l b i l i t l e ~ are available to hlm at Tuross Heads where he llves or at Bateman's Bay where he vlsits from time to time are not clear.
However, there was one factor whlch was referred to but brlefly in hls Honour's reasons but whlch needed to be taken into account when assessinq the apoellant's future loss of earnlnq capactly. That factor was the oosslblllty or continqency that even wlthout the inyury on 26 June 1978 the ?re-existlnq deqeneratlve condition of the apoellant's splne would have Incapacitated hlm in any event. The trauma Involved in the Incldent on the day of the appellant's Inlury was relatively mlnor, but it was of a klnd to whlch the a~oellant was repeatedly exposed by the nature of hls work. The Injury he sustained was one to which he was predisposed because of the pre-exlstlnq lumbar disease. The
possibility that, had he continued in hls work as a plant operator, he would sooner or later have suffered some slmilar sort of injury, cannot be disreqarded.
The medical evidence relatinq to the appellant's predisposition to splnal inyury does not appear to have been emphasised at the hearinq, but it was referred to in his Honour's judqment and it is uncontradlcted. As early as
3 0 November 1978 the appellant's then general practitioner,
Dr Wlshart, reported:

"The probablllty is that he has a dlsc leslon and that it may well be related to the effects of the jarrlnq in June on top of the cumulative effects of years of-olant ooeratlnq in unsorunq seats."

Dr Danta reported, as already mentioned, that the 1978 rnlury was "directly resoonslble for brlnqlnq on the symDtoms on the basls of aqqravatlna lumbar dlsc disease".

The vlew that the apoellant had some capaclty for work and that he was llkely to lmorove after the litlqatlon was most recently and most flrmly expressed by Dr Robson, to whose vlews the trlal judqe obviously qave considerable werqht.

We woulZ also - lllellLIVll - * - - - that the trlal ludqe, In favour

of the appellant, accepted that wlthout the 1978 inlury it was llkely that the aopellant would have worked to the aqe of sixty-flve years. It would have been open to hls Honour to have had regard to a shorter expected worklns llfe endlnq somewhere between slxty and slxty-flve years. This would have ylelded a lower flqure than the $280 ,000 before

deduction of a factor for vlclssltudes.

The effective one half dlscount aoolled by hls Honour may be seen then to comorlse flfteen Dercent for the conventional vicissitudes and thlrty-flve oercent for both the ex~ected recovery of earninq caoaclty and the continqency that even wlthout the in]ury the appellant's pre-existlnq spinal condition mlqht well have become inca~acitatinq, particularly bearina in mlnd the nature of his work as a ~ l a n t ouerator. In those circumstances we are unable to see that the course adouted by his Honour resulted in any error in the calculation of damaqes for future loss of earninq cauacity.

Similar con~iderations auuly to the effective discount

of just over ten oercent of the auuellant's uast loss of earninqs. Whilst his Honour made the flndina that the loss of waqes incurred by time away from work over the years had been causally related to the inlury, he also found that by the time of the hearlnq the appellant had recovered some earninq capacity. It would have been aourooriate for that reason alone to make some deduction from the total fiqure in order to arrive at a sum which reuresented the aooellant's true oast loss of earning caoacity. In any event, it was more than ten years from the time of the in?ury to the time of the hearinq and it was auDropriate to reduce the aqreed loss of earninqs to an extent which took into account the apuellant's moved ~ ~ ~ ~ e ~ t l b l l i t y to s~inal inlury as well as to some of the conventional vicissitudes. For those reasons we see no reason to interfere with his Honour's

award for past loss of earninq capacity.

Finally, we would say that the award of total damaqes

of $ 3 1 5 , 6 7 1 . 3 6 when seen in the liqht of all the

circumstances of the case does not auuear to be inadequate.

The aoueal will be dismissed with costs.

I certlfy that this and the ten precedvlg
pages are a true copy of the Reams for
Judgment hereln of the Court.

ACT G52 of 1988

Counsel for the Appellant Mr. K.J. Crispin QC and
Mr. R.L. Crowe

Counsel for the Respondent : Mr. B.R. Maguire QC and

Mr. R.E. Williams

Solicitors for the Appellant :	Pamela Coward & Associates
Solicitor for the Respondent :	Australian  Government
Solicitor
Date of Hearing	14 March, 1989

FEDERAL COURT OF AUSTRALIA

.	DISTRICT REGISTRY
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