NRMA Insurance Limited v Ashfield

[2018] NSWSC 1593

Supreme Court

New South Wales

Medium Neutral Citation:	NRMA Insurance Limited v Ashfield [2018] NSWSC 1593
Hearing dates:	18 October 2018
Decision date:	22 October 2018
Jurisdiction:	Common Law
Before:	Adamson J
Decision:	(1) Dismiss the amended summons. (2) Order the plaintiff to pay the first defendant’s costs of the proceedings.
Catchwords:	ADMINISTRATIVE LAW – judicial review – Motor Accidents Compensation Act 1999 (NSW) – alleged error of law on the face of the record – whether chain of reasoning sufficiently exposed – whether s 126 complied with – amended summons dismissed
Legislation Cited:	Civil Liability Act 2002 (NSW), s 13 Motor Accidents Compensation Act 1999 (NSW), Part 4.4, Chapter 5, ss 69, 94, 95, 106, 126 Supreme Court Act 1970 (NSW), s 69
Cases Cited:	Allianz Australia Insurance Ltd v Kerr (2012) 83 NSWLR 302; [2012] NSWCA 13 Allianz Australia Insurance Ltd v Sprod (2012) 81 NSWLR 626; [2012] NSWCA 281 Nominal Defendant v Aychahawchar [2015] NSWCA 58; (2015) 70 MVR 89 Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18 Nominal Defendant v Livaja [2011] NSWCA 121 Penrith City Council v Parks [2004] NSWCA 201 Pham v NRMA Insurance Ltd [2014] NSWCA 22; 66 MVR 152 R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309 Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 Zahed v IAG Ltd [2016] NSWCA 55; (2016) 75 MVR 1
Texts Cited:	Motor Accidents Authority, “Claims Assessment Guidelines”, 1 May 2014, cl 18.4
Category:	Principal judgment
Parties:	NRMA Insurance Limited (Plaintiff) Malcolm Ashfield (First Defendant) State Insurance Regulatory Authority of NSW (“SIRA”) (Second Defendant) Elyse White in her capacity as a Claims Assessor of SIRA (Third Defendant)
Representation:	Counsel: M A Robinson SC/J Gumbert (Plaintiff) P Webb QC/N Canosa (First Defendant)   Solicitors: Sparke Helmore Lawyers (Plaintiff) Slater & Gordon Lawyers (First Defendant) Crown Solicitors (Second & Third Defendants, submitting appearances)
File Number(s):	2018/199933

Judgment

Introduction

1. By amended summons filed in Court on 18 October 2018, NRMA Insurance Limited, the plaintiff (the insurer), seeks to have an assessment of damages made in respect of Malcolm Ashfield, the first defendant (the claimant), set aside pursuant to s 69 of the Supreme Court Act 1970 (NSW).

2. The State Insurance Regulatory Authority (SIRA) is the second defendant. Elyse White, in her capacity as a Claims Assessor of SIRA, is the third defendant (the assessor). Both the second and third defendants have filed submitting appearances.

3. All references to legislation in these reasons are references to the Motor Accidents Compensation Act 1999 (NSW) (the Act), except where otherwise stated.

4. The issues are to be determined in the context of the following facts.

Facts

5. The claimant was involved in a motor vehicle accident on 15 January 2015. He made a claim for damages suffered as a result of injuries sustained in the accident. The insurer has admitted liability for the accident. On 2 November 2017 the claimant applied to SIRA for his damages to be assessed. The insurer lodged a reply to the application on 28 November 2017. Following an oral hearing at a general assessment conference on 18 April 2018 (at which both parties were represented by a solicitor and a barrister), the assessor assessed the claim and issued a certificate pursuant to s 94(4) of the Act on 8 May 2018, to which was attached reasons for the decision.

6. The total amount of the assessment was $454,117.05. The assessment included an amount for past economic loss of $134,750 with superannuation of $14,822.50 and an amount for future economic loss of $154,670 with superannuation of $17,013.70. The insurer challenges the components of past and future economic loss.

7. The assessor’s reasons form part of the record: Pham v NRMA Insurance Ltd [2014] NSWCA 22; 66 MVR 152 at [27] (Leeming JA, Tobias AJA agreeing). Any error of law in the reasons will be an error on the face of the record for the purposes of s 69 of the Supreme Court Act. In these circumstances it is not necessary to consider whether any such error is also a jurisdictional error.

Relevant legislative framework

8. A claims assessor is required to assess claims under Pt 4.4 of the Act and also in accordance with Ch 5 of the Act. Section 122(3) provides that Ch 5 applies to the assessment of damages by a claims assessor under Pt 4.4 in the same way as it applies to an award of damages by a court. Claims assessments are subject to guidelines issued pursuant to s 69(1) of the Act: 106(1). It was common ground that the applicable guidelines were the “Claims Assessment Guidelines” effective from 1 May 2014 (the Guidelines).

9. Where liability has been admitted by an insurer, claims assessors have the power and statutory obligation to make binding determinations of damages: s 94. Claims assessors operate within the Claims Assessment and Resolution Service (CARS) unit of SIRA. Section 94 requires a claims assessor to issue a certificate of the assessment to the insurer and the claimant. The claims assessor must attach a brief statement to the certificate setting out the reasons for the assessment.

10. Clause 18.4 of the Guidelines makes further provision for the requirements for reasons as follows:

“18.4 A certificate under section 94 . . . is to have attached to it a statement of the reasons for the assessment. The statement of reasons is to set out as briefly as the circumstances of the assessment permit:

18.4.1 the findings on material questions of fact;

18.4.2 the Assessor's understanding of the applicable law if relevant;

18.4.3 the reasoning processes that lead the Assessor to the conclusions made; and

18.4.4 in the case of an assessment certificate pursuant to section 94, the Assessor must specify an amount of damages and the manner of determining that amount.”

11. Once a claimant formally accepts an amount of damages awarded by a claims assessor, the insurer becomes liable to pay the assessed amount: s 95(2)(b).

12. Chapter 5 of the Act contains s 126, which imposes additional requirements on both courts and claims assessors to articulate their reasons for awards of future economic loss. It provides:

“126   Future economic loss—claimant’s prospects and adjustments

(1)     A court cannot make an award of damages for future economic loss unless the claimant first satisfies the court that the assumptions about future earning capacity or other events on which the award is to be based accord with the claimant’s most likely future circumstances but for the injury.

(2)     When a court determines the amount of any such award of damages it is required to adjust the amount of damages for future economic loss that would have been sustained on those assumptions by reference to the percentage possibility that the events concerned might have occurred but for the injury.

(3)     If the court makes an award for future economic loss, it is required to state the assumptions on which the award was based and the relevant percentage by which damages were adjusted.”

The grounds of challenge

13. The insurer contended that the assessor made the following five errors of law in the assessment:

1. The assessor failed to discount the figures for past and future economic loss to take account of the claimant’s unrelated back injury, although she found that it was necessary that the claimant’s damages be discounted on this basis.

2. The assessor failed to comply with s 126 in that she failed to state the relevant assumptions that led to her adopting the figure of $550 per week for future economic loss for the first two years from the date of assessment.

3. The assessor failed to comply with s 126 in that she failed to state the relevant assumptions that led to the buffer for future economic loss of $100,000.

4. The assessor failed to comply with the statutory obligation to give reasons pursuant to s 94(5) and cl 18.4 of the Guidelines in that she failed to set out her actual path of reasoning as to:

1. the award of $550 net per week (both for the past and for the future) having regard to the unrelated back injury;

2. the buffer of $100,000, having regard to an unrelated back injury; and

3. what effect the unrelated back injury would have had on the claimant’s future employment.

5. The assessor’s reasons contained a significant internal inconsistency in that she failed to take account of the effect of the unrelated back injury when she determined:

1. that the claimant’s damages for economic loss had to be discounted to take into account his unrelated back injury but awarded past economic loss of $134,000 which did not include such a discount (at [33]); and

2. awarded an initial loss for the future of $54,670 calculated by reference to a start date of 1 July 2016 for a two-year closed period using a weekly sum of $550 per week.

The assessor’s reasons

14. Because each of the grounds relates to economic loss I propose to set out the relevant part of the reasons in which this head of damages is addressed

“1.   The Claimant, Mr Malcolm Ashfield (‘Mr Ashfield’) was injured in a motor vehicle accident on 15 January 2015 (‘the accident’). He was standing on a foot path outside his home when a 4WD vehicle pulled in to park on the side of the roadway. As it did, the front left wheel of the vehicle scraped along and mounted the gutter, crushing the Claimant's right foot.

2.   The Insurer, NRMA Insurance Ltd admitted liability for the accident.

. . .

What is the nature and extent of the Claimant's accident related injuries?

4.   There is no dispute the Claimant suffered a significant crush injury to his right foot in this accident.

. . .

7.   In addition, Mr Ashfield reported depressed mood, disturbed sleep, mood swings and low concentration.

. . .

9.   I accept Mr Ashfield has ongoing issues with his right foot because he continues to complain of discomfort which has been accepted by his treating rehabilitation specialist, Dr Davidson.

. . .

10.   I acknowledge the diagnosis and prognosis made by Dr Gray in which he found soft tissue injury to the dorsolateral aspect of the right foot with subsequent haematoma formation and wound breakdown. . . . In a more recent report, Dr Gray agreed that Mr Ashfield has stiffness in the right ankle. Clearly from Mr Ashfield's evidence, unfortunately there has not been a complete recovery and he continues to experience discomfort in his right foot, the extent of which does not allow him to stand or walk for long periods. He finds comfort by sitting and resting and also where possible he told me avoids wearing dress shoes, preferring to wear jogger type runners.

11.   His psychological symptoms appear to be secondary to his physical injuries caused by the disappointment of not being able to work or give his children the same level of care he did before this accident.

. . .

12.    Based on Mr Ashfield's reports to doctors and the opinion of the psychologist the depression and anxiety suffered by Mr Ashfield should decrease if he is able to find suitable employment and with reasonable and necessary future treatment.

Has the Claimant an impairment to his work capacity which is productive of economic loss?

13.    Prior to this accident the Claimant had a reasonable work history. He admits that he did not do well at school and left in Year 9. He can barely read and write and can only manage simple arithmetic. Nevertheless he worked at McDonalds and as a labourer and did have a period of unemployment before successfully securing work as a service station attendant at a Caltex Service Station in North Wollongong (‘Caltex’).

14   After the accident Mr Ashfield was unable to return to this employment and as suggested by Mr Ghaber, his employer was unforgiving terminating his services on 22 October 2015. This termination is most unfortunate as Mr Ashfield ‘loved this work and intended to remain in this position’.

15   Although he has applied for numerous positions, the Claimant has been unable to secure any work since the accident.

16   He told me at the Assessment Conference that he was booked into a forklift licence course in a few weeks and he is optimistic he will secure a ticket which will enable him to look for suitable work as he explained to me, in the Wollongong area there are numerous opportunities in distribution or stores for forklift work.

17   Mr Ashfield's claim for past economic loss is based on a loss of $1,000 00 per week totalling $144,000 00. This is calculated on his average earnings with Caltex from 17 December 2014 to 11 January 2015.

. . .

20   The Insurer further submits that this loss can only be for a closed period because Mr Ashfield was certified fit for his pre injury duties by June 2016.

. . .

24   Dr Adler was engaged by the Claimant's solicitor to assess Mr Ashfield and provide a report. He concludes by March 2016 the Claimant ‘would be fit for part time work up to 4 hours per day with a lifting limit of 10kg, on an occasional basis only’.

. . .

26.    I note the Insurer has conceded Mr Ashfield has a past loss of earning capacity allowing over $57,000.00 including superannuation which is made up of $1,100.00 per week from the date of the accident to 31 August 2015 and then $400.00 per week to June 2016.

27   I agree Mr Ashfield suffered a total loss of earning capacity from the date of the accident to June 2016. I acknowledge there is medical evidence from his treating practitioner that he may have been fit to return to pre-accident duties prior to this but the fact is, he has applied for work without success.

28.   As the Insurer in their submissions allow $1,100.00 net per week loss for the initial period I will adopt this loss for the following period:-

28.1   Date of Accident 15 January 2015 to 30 June 2016 (1 year 24 weeks) at $1,100.00 = $83,600.00

29.   From July 2016 although Mr Ashfield has not successfully obtained employment he is clearly fit for part time work at 50% capacity as opined by Dr Adler. As such I accept his loss has been $550.00 net per week from 1 July 2016 to 18 April 2018 which I have based on the Insurer's concession of $1,100.00 per week.

The calculation is as follows:-

29.1   1 July 2016 to 18 April 2018 (93 weeks)

29.2   $550.00 net per week x 93 weeks = $51,150.00

29.3 Total past wage loss is $134,750.00

30. Applying s 126 of the Motor Accident Compensation Act (the Act) the most likely future circumstance but for this accident is Mr Ashfield would have remained working with Caltex as a service centre attendant.

31.   As a result of this accident he says he can no longer fulfil these tasks because of the requirement to stand all day, load shelves, unpack boxes as well other physical activities.

32.   The Insurer suggests part of Mr Ashfield's physical restrictions relate to his back which was injured whilst working at McDonalds. I agree with this submission as did Mr Ashfield.

33.    I observed during the Assessment Conference Mr Ashfield bending and stretching his back. He agreed at times his back causes significant pain. As a result, I find his future economic loss has to be discounted to take this unrelated injury into account. Mr Canosa [the claimant’s barrister] suggested the loss be discounted by 50% but disagreed with the Insurer's submission that a buffer of $30,000.00 is the appropriate assessment, however at the Assessment Conference Mr Ghaber [the insurer’s barrister] did acknowledge perhaps the amount should be higher than the Insurer's written submissions due to the Claimant's young age.

34.    I agree with Mr Canosa that the initial loss cannot be assessed by way of a buffer. However, as Mr Ashfield is well motivated to eventually find suitable full time work the future economic loss can only be assessed for a closed period. I have assessed this loss from July 2016 at $550.00 net per week which I accept will continue until Mr Ashfield completes his forklift ticket and give him time to locate part time work in this field hopefully leading to full time work in the future. A reasonable lead time is 2 years.

36.    As expected by Dr Adler, Dr Gibson and Mr Ashfield himself, he will ease himself back into the workforce. Therefore these will be a future period of partial loss for 2 years. The initial loss is calculated as follows:-

36.1   2 years

36.2   5% multiplier for 2 years is 99.4

36.3   99.4 x $550.00 = $54,670.00

37.    Thereafter because of Mr Ashfield's ongoing foot pain and spasms I accept he may experience periods off work or sick days to rest his foot. I am also mindful of the unrelated back injury. To compensate Mr Ashfield for this further loss a buffer is the appropriate assessment. I also agree with the Insurer that Mr Ashfield's young age is a further consideration as he has over 40 years of work life. The appropriate buffer for this second period of future economic loss is $100,000.00. Total future economic loss is $154,670.00.”

Consideration

General principles

15. Before turning to the grounds of appeal (which involve significant overlap), I propose to address, in general terms, the obligations imposed on assessors to give reasons and the additional obligations imposed by s 126 with respect to awards for future economic loss.

16. In Wingfoot Australia Partners Pty Ltd v Kocak (2013) 252 CLR 480; [2013] HCA 43 the High Court said, at [55], of a similar statutory regime that the obligation of an assessor was, in substance, to “explain the actual path of reasoning in sufficient detail to enable a court to see whether the opinion does or does not involve any error of law”. Although the obligation to state the assumptions relied upon for the purposes of s 126 is imposed on courts as well as assessors, it has been accepted that the obligation on assessors to give reasons is a lesser one than that imposed on courts. Basten JA said in Allianz Australia Insurance Ltd v Kerr (2012) 83 NSWLR 302; [2012] NSWCA 13 at [53] (Basten JA, McColl and Macfarlan JJA agreeing):

“The limitations of the obligation to give reasons must be kept firmly in mind by a judicial officer accustomed to a higher obligation.”

17. The real question when assessing the adequacy of the assessor’s reasons is whether, on a fair reading of the reasons, the process of reasoning can be discerned, either expressly or as a matter of necessary inference: Zahed v IAG Ltd [2016] NSWCA 55; (2016) 75 MVR 1 at [6] (Leeming JA, Meagher JA agreeing).

18. Since Penrith City Council v Parks [2004] NSWCA 201 it has been accepted that s 126 is not inconsistent with the award of a buffer for future economic loss. The requirements imposed by s 126 in the context of an award in the form of a buffer were considered in Allianz Australia Insurance Ltd v Kerr. In that case, Basten JA summarised the assessor’s reasons on the topic of future economic loss as follows:

“[32]  . . . At the outset of his reasons, the assessor identified, relevantly with respect to future economic loss, two issues which arose:

‘7. . .

a.   But for the accident would the claimant be able to continue in her career as a nursing assistant notwithstanding her pre-existing psychi­atric vulnerability and if so for how long and what is her loss?

b.   Does the claimant have a residual capacity? Given that she is currently working the answer must be ‘yes’ but what is the likelihood of her continuing in that job, or jobs for the balance of her working life, and even if she did is there still a loss?’

[33]     In the course of setting out the claimant’s ‘background’ the assessor noted psychiatric disabilities which she had suffered since a young age, her training, her work experience and the injuries suffered in the accident. After reviewing the various reports on her psychiatric disability, he expressed the opinion that ‘despite her pre-existing vulnerability the claimant’s psychiatric impairment has been noticeably exacerbated by the subject accident’. He noted that she was continuing in employment, although in a job she no longer found satisfying and which there was ‘a real possibility’ of losing. Under the heading ‘Future Economic Loss’ the assessor stated:

‘In my view she has satisfied me that but for the accident she would have had continual work, albeit that from time to time she would have needed to change jobs and have had time off work. Thus she has satisfied s 126 of the Act. She is entitled to some amount for future economic loss but I accept the Insurer’s submission that it should be by way of a buffer rather than a concise [precise?] calculation, given the claimant’s concession of pre-existing psychological issues,her pre-existing work history and her current capacity to work.’

[34]     The assessor then referred to the calculations of each party and accepted the figure of $200,000 as the appropriate sum, being $180,000 more than the insurer suggested was appropriate and $400,000 less than the claimant sought.”

19. Basten JA concluded at [35]:

“[35]     The only factor which was not stated, in conformity with s 126(3), was ‘the percentage possibility that the events concerned might have occurred but for the injury: s 126(2). However, as explained by Giles JA in Penrith CityCouncil [v Parks] at [5], adopting ‘the broad approach of a buffer’ means that there is no question of a percentage adjustment, so that for the purposes of s 126(2), the adjustment is nil: he further held that the failure to state that fact did not constitute a material error (at [6]). There was, accordingly, no material error in the approach adopted by the assessor in the present case.”

20. Basten JA, when considering the adequacy of reasons (which to some extent overlapped with the s 126 ground in Allianz Australia Insurance Ltd v Kerr), drew an analogy between the reasons required for awarding a buffer (whether by a judge or, as here, by an assessor) and the reasons required for imposing a particular sentence, the latter being a task which can only be undertaken by a judge. His Honour referred to the “inherent imprecision” involved in both tasks. Basten JA decided that the assessor, having concluded that an amount should be awarded by way of buffer, was not required to provide some further explanation as to how he reached the precise sum adopted in the award.

The present case

The assessor’s chain of reasoning

21. Before addressing the grounds of appeal I propose to set out the assessor’s chain of reasoning which I consider to be evident from the reasons, either expressly or by necessary implication, as follows:

1. Before the accident, the claimant sustained an unrelated injury to his back for which the insurer was not liable.

2. Until the accident, the claimant was able to work full-time at Caltex notwithstanding his previous back injury and would have continued to do so for the rest of his working life had it not been for the accident.

3. The accident rendered the claimant totally until for work until June 2016. He was therefore entitled to be compensated at the rate of $1,100 net per week for this period.

4. After June 2016 the claimant had recovered sufficiently from the injury sustained in the accident to regain 50% of his pre-accident working capacity and was therefore entitled to be compensated at a rate of $550 per week.

5. By 18 April 2018 (the date of the conference) the claimant’s back condition was such as to have a material effect on his working capacity from that time but it had not had such an effect before. Accordingly it had to be taken into account in respect of any award for future economic loss to reduce such damages but did not need to be taken into account in respect of any award for past economic loss.

6. It was reasonably necessary, as a consequence of the accident, for the claimant to retrain as a forklift driver. He was therefore entitled to be compensated for the time involved in retraining for his new occupation in which he was likely to obtain full-time employment close to his home. This process of retraining and ultimately obtaining full-time employment in his new occupation was likely to take about two years, during which period he would suffer economic loss. The figure of $550 net per week took into account the lost earnings through the period of retraining, the potential effect of the previous back injury and the claimant’s likely earnings as a forklift driver during that initial two-year period.

7. Although the claimant would be likely to work for another 40 years, as he would have done but for the accident, some allowance should be made for ongoing difficulties with his foot which was injured in the accident (which is compensable) as well as for the potential effects on his earning capacity of his back injury, for which the insurer is not liable. A buffer of $100,000 is appropriate in these circumstances.

The grounds of appeal

The insurer’s submissions

22. The insurer contended that there was an unexplained inconsistency between the amount for the past ($550 net per week) and the amount for the closed period of two years for the future ($550 net per week). Mr Robinson SC, who appeared with Ms Gumbert on behalf of the insurer, argued that there was no reason for these figures to be the same since the circumstances in the past were to be distinguished from those in the future. He also submitted that it was not clear whether, and to what extent, the claimant’s unrelated back injury had been taken into account in the assessment of damages based on these figures. Mr Robinson submitted that the identity of the figures must be erroneous because there was another integer to be taken into account for the figure for the future, namely the effect of the pre-existing back condition, which ought to have had the effect that the weekly figure for future loss was lower than the weekly figure for past loss.

23. The insurer also contended that, in respect of the future closed period and the future buffer, although the assessor had said that she was required to take into account the unrelated back injury and discount damages accordingly, there is no indication that she actually did so and no quantification of the amount of any such discount.

Consideration

24. As there is considerable overlap in the grounds of appeal, I propose to address them broadly before turning to each specifically.

25. The first point to be made about the unrelated back injury is that it pre-dated the claimant’s employment at Caltex Service Station. Thus the claimant’s pre-accident weekly earning capacity of $1,100 took into account his pre-existing back injury. In substance the assessor found that the claimant had, by reason of the injury sustained in the accident, totally lost his earning capacity (measured at $1,100 per week) until June 2016 and that, during the period from June 2016 until 8 May 2018 (the date of the certificate), the claimant had lost half his earning capacity due to the injury sustained in the accident (measured at $550 per week being 50% of $1,100 per week).

26. The assessor noted in her reasons that, at the assessment conference on 18 April 2018, the claimant had visible symptoms arising from the pre-existing back condition and said that they would need to be taken into account by discounting the claimant’s damages for future economic loss. The assessor then turned to the assessment of future economic loss, which attracted the operation of s 126. Although the assessor did not expressly say that the back injury had not materially affected the claimant’s past economic loss, I consider this conclusion to have been necessarily implied by the assessor’s express finding that it would have to be taken into account in assessing damages for future economic loss.

27. Under s 126, the assessor was obliged to satisfy herself of the claimant’s most likely circumstances but for the injury; set out these circumstances in the form of assumptions; and use these assumptions as a basis for the award of damages for future economic loss. While every case must turn on its facts, the types of matters relevant to the exercise required by s 126 were listed by Basten JA in Nominal Defendant v Livaja [2011] NSWCA 121 at [41]-[42]:

“[41]     The assumptions or events upon which a baseline may commonly be calculated include:

(a)   identification of the skills, training and experience of the plaintiff, as at the date of the accident;

(b)   the work he or she was undertaking immediately prior to the accident;

(c)   the likelihood that he or she would have continued in such employment, but for the accident;

(d)   the possibility that he or she might have obtained promotion or other benefits, but for the accident;

(e)   the age to which he or she was likely to have worked in that employment, and

(f)   the possibility that the employment would not have been continuous.

[42]     Each of these factors is liable to variation, depending upon the circumstances of the case. . .”

28. Mr Robinson accepted that, in the present case, (a), (b), (c) and (e) were evident from the assessor’s reasons and that (d) and (f) were not relevant in the circumstances of the present case.

29. The assessor found that, but for the accident, the claimant would have remained working with Caltex as a service centre attendant (at [30]). The assessor found that, partly as a result of the accident and partly as a result of the claimant’s unrelated back condition, the claimant could no longer perform those duties. The assessor found that the claimant would be likely to work for another forty years (this being the same period as had he not been injured). By necessary implication, the assessor found that the pre-existing back condition would not, of itself, have prevented the claimant from continuing to work at Caltex for this period.

30. The assessor expressly acknowledged that the damages for future economic loss would have to be discounted to take account of the pre-existing back condition, the symptoms of which she observed at the conference. In this acknowledgement there was no distinction drawn between the two years following the certificate and the period beyond that period. A fair reading of the reasons leads to the conclusion that the assessor took the pre-existing back condition into account for both future periods.

31. In light of the assessor’s reasons, it is apparent that the assessor took into account the following matters when determining the figure of $550 net per week for the future closed period of two years from the date of the certificate: first, the need for the claimant to retrain as a forklift driver as a result of the injury sustained in the accident; secondly, the time it would take to obtain part-time and then full-time work in that new occupation; and thirdly, the pre-existing back condition. It is, in these circumstances, not to the point that the figure of $550 per week for the initial two-year period happens to be the same as the figure for the past economic loss since the process of reasoning which produced the same figures was different, as is evident from the reasons.

32. The present is not the usual case where the figure for the past and the figure for the future would ordinarily be the same, the dividing line between them being determined by the date of the assessment or judgment, which is necessarily arbitrary. This was the situation in Nominal Defendant v Aychahawchar [2015] NSWCA 58; (2015) 70 MVR 89 where I said at [18] (Basten and Gleeson JJA agreeing):

“[N]either the legal principles nor the findings of fact allow assessments of past and future economic loss to be made entirely independently of each other. First, both calculations involve the assessment of hypothetical circumstances to be assessed by reference to possibilities and not on the balance of probabilities. Secondly, the actual circumstances of the respondent, as revealed on the evidence at trial, will both condition the assessment of past economic loss and provide the basis for the calculation of future economic loss. Thirdly, the principle of coherence requires that where the assessment of the plaintiff’s ‘most likely future circumstances but for the injury’ is to be carried out pursuant to the statutory regime as to the future, the same approach should be adopted with respect to the past. The principal difference between the assessment of past and future economic loss results from evidence of the actual condition of the plaintiff between the date of injury and the date of trial, resulting in part of the exercise as to the past being hypothetical, whereas in relation to the future, both elements of the exercise are hypothetical.” 

[Footnotes omitted.]

33. In the present case, there were two significant distinctions between the past and the future: first, the claimant at the conference exhibited signs of discomfort arising from the pre-existing back condition; and, secondly, he told the assessor of his immediate plans to retrain as a forklift driver and obtain full-time work in that occupation in the future. It was these matters which called for an assessment to be made for the forthcoming years on a different basis from that made for the previous two years.

34. The assessor set out the basis of the future awards, both for the closed period of two years following the assessment and the period beyond that. It cannot be assumed from the circumstance that the assessor did not specify any percentage reduction for the allowance made for the unrelated back injury that she did not take it into account. Indeed, her reasons refer to that matter specifically in the context of the awards for future economic loss. On a fair reading of her reasons, the reference to future economic loss incorporates the closed period of two years and the buffer. In the analogous context of sentencing referred to by Basten JA in Allianz Australia Insurance Ltd v Kerr, it has been accepted that, although a sentencing judge is required to take a guilty plea into account in sentencing, a failure to quantify the discount in the reasons is not an error. As long as the sentencing judge refers to the guilty plea in the reasons, this is generally sufficient to indicate that it has been taken into account: R v Thomson; R v Houlton (2000) 49 NSWLR 383; [2000] NSWCCA 309 at [46] (Spigelman CJ). The present case is to be distinguished from Zahed v IAG Ltd where the assessor’s finding involved a rejection of the opinions of all the practitioners who gave evidence on the question of the amount of weekly assistance required, and no explanation was given for the hourly figure used to base the award.

35. I am not persuaded that there was any unreasonableness in the sense considered by the High Court in Minister for Immigration and Citizenship v Li (2013) 249 CLR 332; [2013] HCA 18 (Li). For the reasons given above, I consider there to be an “evident and intelligible justification” (Li at [76]) for the assessor’s awards for past and future economic loss.

The grounds of appeal

36. I propose now to summarise the consequences of the reasons I have given above by reference to the grounds of appeal in turn.

The first ground

37. The first ground alleges that the assessor failed to discount the figures for past and future economic loss to take account of the claimant’s back injury, having found that it was necessary that the figure be discounted on that basis. As referred to above, I do not understand the assessor’s reasons as finding that the damages for the past are to be discounted on the basis of the pre-existing back injury. The assessor said that the damages for the future would have to be discounted on that basis. For the reasons given above, I am satisfied that such a discount was taken into account for the closed period for the two years after the date of assessment as well as for the period beyond which was covered by the buffer. This ground has not been made out.

The second ground

38. The second ground alleges that the assessor failed to set out the assumptions that led to her adopting the figure of $550 for future economic loss for the two-year closed period. For the reasons given above, I consider that the assessor sufficiently set out the relevant assumptions as to the likely future circumstances but for the accident (the claimant would have continued to work at the Caltex Service Station full-time for the rest of his working life), as well as the likely future circumstances as a result of the accident (the claimant would retrain as a forklift driver and endeavour to return to part-time and then full-time work in that occupation, with allowance to be made for the pre-existing back injury). These assumptions were sufficient to set out the chain of reasoning for the purposes of s 94 and cl 18.4 of the Guidelines and to fulfil the requirements of s 126. This ground has not been made out.

The third ground

39. The third ground alleges that the assessor failed to state the relevant assumptions that led to the buffer for future economic loss of $100,000. It is significant that, as referred to above, the Court of Appeal in Penrith City Council v Parks said of a similar provision to s 136 (s 13 of the Civil Liability Act 2002 (NSW)) that the legislation did not preclude an award for future economic loss in the nature of a buffer. Although the Court considered that the statutory provision required the determination of the claimant’s likely future circumstances, there was no question of a percentage adjustment (as referred to in s 126(2) and (3)) when a buffer was awarded because of the broad approach involved in such an award (Giles JA at [5]; Cripps AJA at [10] and McClelland AJA at [58]; see also Allianz Australia Insurance Ltd v Sprod (2012) 81 NSWLR 626; [2012] NSWCA 281 at [37] (Barrett JA, Campbell JA and Sackville AJA agreeing). The pre-existing back condition was in the category of vicissitudes to be taken into account in the amount of the buffer. It was sufficient for the assessor to record that she had taken the previous back injury into account and unnecessary to express a percentage adjustment.

40. For the reasons given above, I am satisfied that the assessor adequately set out the claimant’s likely future circumstances but for the accident and provided sufficient reasons to explain why a buffer was being awarded, rather than a capitalised weekly sum. These reasons included the claimant’s youth; the length of his remaining working life; and the need to discount the damages to take account of the pre-existing back injury. This ground has not been made out.

The fourth and fifth grounds

41. The fourth and fifth grounds are covered by the reasons given above. Neither has been made out.

Conclusion

42. I am not satisfied that any of the grounds of appeal have been made out. The parties accepted that there was no reason why costs ought not follow the event.

Orders

43. For the reasons given above, I make the following orders:

1. Dismiss the amended summons.

2. Order the plaintiff to pay the first defendant’s costs of the proceedings.

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Decision last updated: 23 October 2018