Murdoch v Davis

[2009] NSWCA 416

New South Wales

Court of Appeal

CITATION:	Murdoch v Davis [2009] NSWCA 416
HEARING DATE(S):	9 November 2009
JUDGMENT DATE:	18 December 2009
JUDGMENT OF:	McClellan CJ at CL at 1; Handley AJA at 51
DECISION:	Appeal dismissed with costs.
CATCHWORDS:	APPEAL - award of damages - motor vehicle accident - physical and psychological problems - whether the general damages were manifestly insufficient due to the wide ranging nature and severity of the appellant's injuries - whether the amounts awarded for economic loss, domestic assistance, future cost of medication and superannuation were inadequate - appeal dismissed
LEGISLATION CITED:	Motor Accident Compensation Act 1999 (NSW)
CATEGORY:	Principal judgment
PARTIES:	Gerald Murdoch (Appellant) Bradley Robert Davis (Respondent)
FILE NUMBER(S):	CA CA40085/09
COUNSEL:	S Norton SC/M Daley (Appellant) K Rewell SC/G Smith (Respondent)
SOLICITORS:	Brydens Law Office (Appellant) TL Lawyers (Respondent)
LOWER COURT JURISDICTION:	District Court
LOWER COURT FILE NUMBER(S):	3698/03
LOWER COURT JUDICIAL OFFICER:	Garling DCJ
LOWER COURT DATE OF DECISION:	19 December 2008

CA 40085/09
DC 3698/03

McCLELLAN CJ at CL
HANDLEY AJA

FRIDAY, 18 DECEMBER 2009

MURDOCH v DAVIS

Judgment

1 McCLELLAN CJ at CL: This is an appeal against an award of damages made to the appellant in the District Court for injuries he suffered on 14 June 2000 when he was driving his motor vehicle in Canterbury Road in Sydney. His vehicle was stationary when it was struck from behind by the defendant’s truck in a violent collision. Liability was not in issue.

2 The appellant suffered physical injuries and has since developed psychological problems. He is now unable to work and complains of constant pain. Damages were assessed in the District Court in a total sum of $1,184,661 comprised of the following sums:

Non-economic loss	$225,000
Past out-of-pocket expenses	$98,941
Future out-of-pocket expenses	$172,880
Past economic loss	$175,500
Past loss of superannuation	$19,305
Future economic loss	$274,635
Future loss of superannuation	$30,210
Past domestic assistance	$8,190
Future domestic assistance	$180,000
$1,184,661

3 The notice of appeal raised sixteen grounds of appeal some of which are repetitive of each other. Before considering the grounds it is convenient to outline the sequence of events and some other matters.

4 The appellant was born on 28 August 1962. He was aged 35 years at the time of the accident and is now aged 47. At the time of the accident the appellant was married, but he and his wife are now divorced. The appellant and his wife, together with his parents-in-law, had for a number of years prior to the accident conducted a clothing manufacturing business. By the time of the accident the business was in serious decline and failed within a relatively short period of time thereafter.

5 The appellant saw his general practitioner, Dr Kim, on the day of the accident. He complained of a head injury and a neck injury. He reported pain in his right knee, right foot and ankle, right shoulder, right arm and low back. The appellant has continued to complain of problems with his neck, mid and low back and right shoulder, although some of the minor complaints which he initially made to Dr Kim have resolved.

6 When he saw Dr Kim following the accident the appellant made no complaint of problems with his left shoulder. He complained to Dr Hardcastle, on 13 February 2001 of “generalised pain from the top of his head down over both shoulders down his spine to the buttocks, then down his legs (front and back) and into his feet.” The next recorded complaint of pain in his left shoulder is in the report of Ms Nieuwenhaven, physiotherapist, dated 1 March 2002. The trial judge found that the reported pain in the left shoulder was not a result of any injury caused in the accident.

7 Dr Kim last saw the appellant in August 2000 at which time he continued to complain of neck and back problems. Shortly afterwards the appellant moved with his wife to live in Darwin where he was seen by Dr Tracey. He reported the same problems as he had complained of to Dr Kim but also complained about problems with his sight and his hearing. His physical well being and psychological health declined and before long he was seeing various doctors and complaining of a variety of problems.

8 The appellant was referred to Associate Professor Dan who is a neurosurgeon at Concord Hospital and a clinical Associate Professor at the University of Sydney. He accepts that the appellant’s reported ailments are a result of the accident.

9 In response to requests from the appellant and with the hope of reducing the pain which the appellant says he has suffered from Dr Dan carried out a decompression and fusion of C5/6 in the appellant’s spine. Dr Dan believes that the operation was successful in reducing the appellant’s pain and disability. However, in September 2007 Dr Dan reported that the appellant continued to complain of pain and was taking a high dose of narcotics to relieve it. As a consequence he developed hypopituitaryism which required hormonal supplement medication. Dr Dan has recorded that the appellant suffers from significant psychological distress due to his dysfunction and indicates “that could be part of the chronic pain syndrome.”

10 At the trial the respondent called evidence from Dr Matheson, a consultant neurosurgeon, who reached a different conclusion to Dr Dan. Dr Matheson believes that many of the appellant’s physical problems are not a result of from the motor vehicle accident.

11 The trial judge preferred the evidence of Dr Dan. However, his Honour concluded that most of the appellant’s physical problems have resolved and that his remaining problems have a psychological origin.

12 The appellant’s medical history is complicated by the fact that after the accident he developed a tumour in his brain, referred to as a meningioma. Dr Dan operated and removed the tumour following which the appellant claimed that he had lost complete sight in his right eye. He also claimed that he has diminished sight in his left eye. Dr Dan is of the opinion that whatever is the problem with the left eye it was not caused by the brain surgery. Dr Dan is of the opinion that there has been complete loss of sight in the right eye, but notes that the appellant does have light reflexes and accordingly Dr Dan believes there is some activity in the eye. Dr Dan said that the tumour was not a result of the motor vehicle accident.

13 The trial judge received evidence from Dr Peter Anderson, an ophthalmic surgeon, who reported in March 2008 that the appellant had no vision in his right eye and considerable reduced vision in his left eye. Dr Anderson believes that the appellant is unable to drive, is restricted to clerical work and requires a strong magnifying aid to read and see many smaller objects.

14 The trial judge did not form a favourable opinion of the appellant’s credibility. In forming his view the trial judge gave significant weight to a video film on which the appellant’s movements were recorded over a lengthy period of time. One film was taken between 22 August 2002 and 29 August 2002. His Honour’s observation was that it “showed a man who did not appear to have any serious physical disability. He was working in a food store in a market, it was exposed over a long period of time, he stood for lengthy periods, he bent, lifted, at times he sat and then he was up standing again, moving around, serving people and I must say, whilst he may have had some disability, he appeared to be going about in a way you would expect a man of his age to go about it.” His Honour concluded that although the appellant received assistance at times he “appeared to be a man who was physically able to do what you would expect of a man of his age.” Further film was exposed in September 2006 from which his Honour concluded that it showed “a man who moves quite freely.”

15 A further film was exposed in October 2006 which showed the appellant at times needing a crutch and walking with a limp but, after he had been to a medical appointment, he abandoned his crutch and appeared to walk normally.

16 The trial judge found that the appellant’s evidence was generally unacceptable and could not be relied upon. After viewing the film his Honour concluded that the appellant was not as disabled as he wanted the court to believe. His Honour said that the film “confirmed his bizarre sickness behaviour and his eagerness to impress that he had serious problems.”

17 The appellant has been seen by Dr Jungfer, a consulting psychiatrist, who gave evidence at the trial. She expressed the opinion that the appellant is suffering psychiatric difficulties which are “direct response to the persistent and chronic pain and multiple stresses that have arisen as a consequence of the motor vehicle accident.” Dr Jungfer concluded that the appellant “had a chronic depressive disorder within the context of chronic pain.” She concluded that because the appellant was prepared to seek physical treatment, including subjecting himself to surgical procedures, even if there was no identifiable physical reason for some of the pain, he “is experiencing that pain because his behaviour reflects it.” She concluded that he now identifies himself as a patient and is very much “entrenched in the sick role”. Dr Jungfer believes that the appellant’s present condition is likely to be a continuing pattern. She believes that the appellant is concerned that people may abandon him.

18 Dr Jungfer gave evidence of her observations of the appellant and his ability to see. When she arrived to give evidence to the court the appellant recognised her from the distance of about a metre and a half. The appellant’s counsel at the trial acknowledged that the sight in the appellant’s left eye must not be as severely reduced as the appellant claimed. The trial judge also observed the appellant standing in court watching a number of films from some distance and concluded that he appeared to be able to see what was being displayed on the monitor. However, there were times when he was observed to walk up to the monitor and look closely at it. He also used a magnifying device when asked to read in court.

19 The trial judge accepted the evidence of Dr Jungfer. His Honour concluded that until the accident the appellant was leading a normal life but then suffered “physical injuries to his neck, mid and low back and his right shoulder and then developed this psychological and psychiatric problem with chronic depressive disorder within the context of chronic pain. It appears that it continues and will continue and it results from the motor vehicle accident some 8 years ago.”

20 The trial judge concluded that any loss of sight in the right eye is not related to the motor vehicle accident and that any loss in the sight of the left eye is related to the psychological problems that have arisen as a result of the accident.

21 As I have previously indicated at the time of the accident the appellant was a partner in a family business conducted by a company – Urbi Gold Pty Ltd. The company was formed in 1988. The appellant, his wife and his parents-in-law each had a share in the business which produced clothing garments. The business was originally conducted from their home and later from rented premises. Because of the cost and inconvenience of relocating the factory when a lease expired it was decided to buy factory premises. A building was purchased in either 1998 or 1999 but was found to have significant problems. The local council prohibited occupation until fire and safety matters were rectified. This was not done and it was necessary to carry on the manufacturing garments in various employees’ houses. This proved to be inefficient.

22 In September 2000 the appellant and his wife moved to the Northern Territory. They had been intending to move for a significant period of time before the accident. The motivation for the move was a belief that the appellant’s wife, who had health problems, would benefit from a warmer climate. The appellant gave evidence that he had intended to fly back and forth from Darwin to assist in the running of the business in Sydney. This would have been necessary because it was the appellant who organised the enterprise and was responsible for obtaining orders. The appellant gave evidence that because of his injuries he was unable to continue with the proposed travel schedule. He said that his brother-in-law proved unable to run the business and it was closed. The appellant and his wife assigned their interests in the business to the appellant’s parents-in-law without any payment.

23 The appellant said that in 2001 he assisted his wife in her business in the Northern Territory selling food at the market. It seems that he was not paid for this work. He had also been paid for work on a fishing trawler where he spent 2 periods of ten days, but found the work difficult and did not continue. He has not otherwise worked since the accident.

24 The Sydney business reached its peak turn over of $850,000 in 1995/96. However, after that it declined and in the financial year 1999/2000 the turn over had reduced to $380,000. In 1998/99 the appellant was paid $470 per week from the business. By 1999/2000 this was reduced to $258 per week.

25 Although the evidence of the financial status of the business was limited it would seem that it was successful for a number of years. The tax return for the financial year 1999/2000 includes an information statement which identified shareholder’s funds of $324,948. In the financial year 1998/99 the company made a taxable profit of $68,540.

26 Apart from his earnings from the family business and the fishing ventures there was no evidence of the appellant’s earning capacity. There was no suggestion that he had any tertiary qualifications and although he had previously worked in the fishing industry, as an abalone and sea cucumber diver, there was no evidence that by the time of the accident he would have been able to carry out this employment or any prospective earnings if he could. Although he earned in excess of $4,000 for his 10 days working on a fishing vessel there was no evidence that, but for the accident, he would have done this work nor the usual earnings of a person employed in that industry.

27 The appellant claimed that the clothing business failed because of the injuries he suffered in the accident which resulted in his inability to contribute to the enterprise as he had previously been able. However, the trial judge was sceptical of this claim. To my mind his Honour’s conclusion was correct. He did not believe that the appellant could have effectively conducted the business and lived in Darwin. The prospect of the appellant continuing to successfully obtain orders for the business and organise the distribution of the finished garments whilst living in Darwin is implausible.

28 Although the plaintiff had earned approximately $500 per week from the business during the 1990s this had dropped to almost half this amount by the time of the accident. Notwithstanding the decline his Honour concluded that the appellant’s earning capacity should be assessed at $500 per week, a finding which the respondent submitted was generous. His Honour also concluded that for an initial period after the accident the appellant would have been completely unfit for work but, thereafter and until the major psychological problems emerged, he would have been fit for various jobs on the open market. Accordingly his Honour assessed a loss of earning capacity between 14 June 2000 and 15 September 2001, about 65 weeks, at $500 per week which is a total of $32,500. From 15 September 2001 to 15 April 2004 he assessed him as having a loss of $250 per week, that is 134 weeks, and a total of $33,500.

29 His Honour excluded the period when the appellant would not have been able to work because of the tumour and problems with his right eye assessing that he would have been off work for a period of two months from 26 July 2007 until 26 September 2007. His Honour determined the loss to be at a rate of $500 per week from 15 April 2004 until 26 July 2007. His Honour made an award at the same rate for the period from 26 September 2007 until 15 December 2008.

30 His Honour determined that the appellant should receive an award for his loss of future earning capacity for a period of 19 years at a rate of $500 per week. His Honour determined that his earning capacity would have been diminished because of his tumour and the loss of the sight of his right eye, which were unrelated to the accident. Allowing for vicissitudes his Honour concluded that the appellant was entitled to $274,635 for his future economic loss.

31 The appellant claimed for domestic assistance. He said that following the accident and before they separated, his wife used to provide him with about 25 hours per week of help. They separated in December 2006 when the appellant went to live in a hostel. After his neck operation he shared accommodation with Mr Brown for 4 or 5 months. Since then he has mostly lived in shared accommodation with Mr Shish. The appellant claimed that he needed very significant ongoing care. Mr Shish said that he was the appellant’s fulltime carer and provided 23 hours per week in assistance. However, his Honour believed this claim was exaggerated and ultimately determined that the appellant was entitled to 10 hours at a rate of $22 per hour. Applying the appropriate multiplier his Honour provided a sum of $180,000 for the cost of ongoing care.

Grounds 1, 2, and 10:
Ground 1: That the trial judge erred in his assessment of general damages.

Ground 2: That the general damages awarded were manifestly insufficient.

Ground 10: That the trial judge erred in failing to include the plaintiff’s left shoulder as part of his damages under all headings of damages.

32 It is convenient to deal with these grounds together.

33 The trial judge made an award of general damages in the sum of $225,000. The appellant contended at the trial and before this Court for the maximum award permitted by the Motor Accident Compensation Act 1999 (NSW) of $390,000. It was submitted that because of the wide ranging nature and severity of the appellant’s injuries the trial judge had erred and a more generous sum should have been provided.

34 Senior counsel for the appellant submitted that he had suffered greatly because of the accident. He had required a spinal fusion in an endeavour to relieve his pain. Notwithstanding this surgical intervention he continued to suffer chronic pain which required strong narcotic medication which had caused hypopituitaryism necessitating hormonal replacement therapy. It was submitted that his Honour had not had sufficient regard to these matters. It was further submitted that his Honour had failed to recognise a problem occasioned to one of appellant’s teeth which required dental intervention and a problem with his jaw. It was further submitted that his Honour had inappropriately concluded that the pain of which the appellant complained in his left shoulder, was not a result of the accident.

35 The respondent submitted that the award which his Honour made for general damages was appropriate, if not generous. Senior counsel emphasised that after viewing the lengthy film taken of the appellant’s movements his Honour had concluded that many of the symptoms he reported had been exaggerated. It was submitted that this conclusion was both open and correct and justified a finding that a moderate award for general damages was appropriate. It was submitted that an examination of the whole of the trial judge’s reasons, including the discussion of the appropriate award for medical expenses, revealed that his Honour was conscious of all of the problems reported by the appellant and had not overlooked any particular complaint when assessing the appropriate aware for general damages.

36 In my opinion the respondent’s submission should be accepted. In the course of oral argument the appellant’s counsel accepted that his Honour was entitled to have regard to the video footage when assessing the appropriate sum for general damages. After reviewing the footage his Honour concluded that it “showed a man who did not appear to have any serious physical disability” and was exaggerating his symptoms. The findings which his Honour made were clearly open to him. I am satisfied that his Honour was mindful of the appellant’s problems with his teeth and also the difficulties occasioned to him by the need to take pain killing drugs in significant quantities. With respect to his left shoulder his Honour’s finding that the reported symptoms were not a result of the accident was clearly open to him.

37 I reject these grounds of appeal.

Grounds 3 to 6 and 8 – economic loss
Ground 3: that the allowance for past economic loss did not take into account that the appellant’s actual wages were only a part of his earnings.

Ground 4: That the trial judge erred in failing to take into account as earnings the earnings of the company structure through which the appellant derived his income.

Ground 5: that the allowance for past economic loss did not take into account increases in average weekly earnings or earnings generally from the time of accident to the time of trial.

Ground 6: That the assumption of weekly earnings of $500 nett per week throughout the period from accident to trial served to under compensate the appellant in respect of past economic loss.

Ground 8: that future wage loss should have been calculated at average weekly earnings figures or alternatively at a rate commensurate with the amount the appellant should have received, but for the accident, and including his company’s involvement.

38 It was submitted by the appellant that his economic loss should have been assessed at a rate of $750 per week which reflected average weekly earnings.

39 As I have related when determining to award an amount of $500 per week his Honour had regard to the earnings of the appellant when he was involved in the family business. By the year 2000 his earnings were relatively modest compared with average weekly earnings for a male person and are, of course, even more so today. However, his Honour was required to make his decision “doing the best he could” with the evidence before him. If there had been evidence that, but for the accident, the appellant could have earned at a greater rate a higher award would have been appropriate. However, there was no evidence before his Honour which could have justified such a finding. It is apparent that the appellant had an ability to organise the family business and obtain orders which for a time generated a significant turnover. However, although from the limited evidence tendered at the trial the business appears in its early stages to have been profitable, the appellant earned only in the order of $500 per week from it. Apart from the evidence of the short periods when he worked on a fishing vessel, which evidence did not allow extrapolation for loss of future earning capacity, the appellant did not provide the trial judge with any other evidence of his loss either past or future.

40 I am ultimately left with a sense of disquiet about this issue. It is possible that the appellant had a capacity to earn at a greater rate than is reflected in a sum of $500 per week. However, without evidence on which to base a finding the appellant‘s argument on this issue must fail. Because by the time of the accident the appellant’s earnings had dropped to approximately $250 per week a finding of a loss of future earning capacity assessed at $500 per week was the most which the trial judge could determine.

41 I reject these grounds of appeal.

Grounds 7 and 9:
Ground 7: That the amount allowed for past loss of superannuation was manifestly insufficient.

Ground 9: That the amount for future loss of superannuation was manifestly insufficient.

42 The sum to be provided for loss of superannuation was a mathematical consequence of the sum awarded for the loss of future earning capacity. I have concluded that the sum which his Honour awarded in this respect was appropriate and accordingly no adjustment is required to the amount awarded for future loss of superannuation.

Ground 11: That the trial judge erred in failing to award the appellant sufficient damages for domestic assistance both past and future.

43 The appellant submitted that his Honour was in error by confining the award for the cost of future care to a figure based upon services for only 10 hours per week. It was submitted that his Honour was wrong to reject Mr Shish’s evidence that he provided 23 hours per week of assistance to the appellant with his domestic tasks. It was submitted that the allowance of 10 hours per week was arbitrary and had no basis in the evidence.

44 His Honour approached the assessment of the appropriate award for future care mindful of the observations of the appellant’s capacity provided by the video footage. His Honour concluded that the appellant was capable of carrying out more tasks for himself than were required of a person receiving care for in the order of 23 hours per week.

45 I am satisfied that his Honour was entitled to form this conclusion. Having effectively rejected the hours which Mr Shish said were necessary for him to provide assistance for the appellant he was required to assess the appellant’s need doing the best he could with the available evidence. I am not persuaded that by concluding that ten hours was appropriate his Honour erred.

46 I reject this ground of appeal.

Grounds 12, 13 and 14
Ground 12: That the trial judge erred in failing to allow the appellant sufficient damages for future cost of medication.

Ground 13: That the trial judge erred in reducing the amount of future out-of-pocket expenses by way of medication by the whole or any of the appellant’s PBS entitlements.

Ground 14: That the trial judge should have awarded the appellant the full cost of continuing medication for the balance of his assumed lifetime.

47 The appellant accepted at the hearing that he was not entitled to an award of damages which included the cost of medications which would be met by the Pharmaceutical Benefits Scheme. The Scheme operates so that the appellant is only required to meet $2,000 per annum of his medications, any amount over and above this sum being funded by the Scheme. The appellant’s senior counsel submitted that it was possible that in the future the Scheme may be modified or discontinued and the appellant may be required to bear a greater cost and accordingly was entitled to an award which took account of vicissitudes.

48 This issue was not debated at the trial and there was nothing in the evidence to suggest that the existing Scheme would not continue. Accordingly there is nothing before this Court which would allow for an award to be made on the basis for which the appellant now contends.

49 I reject this ground of appeal.

50 In my judgment the appeal should be dismissed with costs.

I agree with McClellan CJ at CL.

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