Portolesi & Masterpass P/L T/A Prestige Appliance Repair Centre v Cordeaux No. DCCIV-01-1650
[2003] SADC 142
•12 September 2003
PORTOLESI AND MASTERPASS PTY LTD TRADING AS PRESTIGE
APPLIANCE REPAIR CENTRE v CORDEAUX
[2003] SADC 142Judge Rice
CivilIntroduction
This is a claim for damages arising in the following circumstances. The first plaintiff, Rocco Portolesi (“Mr Portolesi”) was employed by the second plaintiff, Masterpass Pty Ltd trading as Prestige Appliance Repair Centre (“Masterpass”), as a service and repair technician of domestic gas and electric appliances. The defendant, Jeremy Cordeaux (“Mr Cordeaux”) was the occupier of house premises at 54 Sunnyside Road, Glen Osmond.
On the 29th October, 1998, in the course of his employment, Mr Portolesi attended at Mr Cordeaux’s home at Glen Osmond to carry out repairs and/or maintenance upon a stove at the house. Mr Portolesi, upon entering the house, was attacked and set upon by small Jack Russell terrier dogs. Mr Portolesi was allowed entrance by someone other than Mr Cordeaux. Mr Cordeaux was not home at the time. One of the dogs bit Mr Portolesi on the right calf. At this time Mr Portolesi was carrying a heavy tool-box and, in an endeavour to avoid or repel the attack, he twisted to his right-hand side and thereby injured his back in the lower back region. Mr Portolesi claims damages for non-economic loss and past and future economic loss. Masterpass claims damages for past and future economic loss arising from the incapacity of Mr Portolesi which resulted in his inability to return to his pre-injury employment.
Liability is not disputed in that there is no contest that Mr Cordeaux owed a duty of care to the plaintiffs, that there was a breach of that duty and an injury sustained. However, what is very much in dispute is whether Mr Portolesi suffered any incapacity and loss (other than perhaps in the short-term) or whether Masterpass sustained any loss in view of its increased profitability after the incident. The circumstances of that occurring are detailed below. There are competing accounting views, it being said on the one hand that the plaintiffs have suffered little or no loss and, on the other, that Mr Portolesi has suffered a very substantial loss. There seems to be a consensus that Masterpass has not suffered any loss (Gibbs TP146, Cooper TP266, 280-1, 284-5).
The injury
Mr Portolesi is 37 years old, married with three children (TP12). He and his wife are the sole shareholders and directors of the second plaintiff, Masterpass. As mentioned, Mr Portolesi attended at the premises of the defendant at 54 Sunnyside Road, Glen Osmond on 29th October, 1998 in his capacity as an employee of Masterpass. He was accompanied by his brother, who was working for Masterpass as a tradesman’s assistant at the time. A female occupant of the premises greeted them at the door. Mr Portolesi could see that there were two or three Jack Russell terriers at the door. He enquired whether the dogs were safe and the lady replied that they were fine. When the female occupant opened the door the dogs attacked Mr Portolesi, one latching onto his calf. At the time Mr Portolesi was carrying a tool-box in his left hand. The tool-box was approximately 10-15kg in weight. Mr Portolesi twisted in an attempt to get the dog off his leg and at that point he felt a sharp pain in his back (TP16). Mr Portolesi was unable to complete the work at the premises and supervised his brother, Patrick Portolesi, who completed the repairs (TP17). As soon as the job was completed, Mr Portolesi called the office and asked them to make an appointment for him to see Dr Chia, the family doctor.
Mr Portolesi saw Dr Chia early that afternoon. Dr Chia gave him a tetanus shot and cleaned the wound from the dog bite (TP199). Mr Portolesi complained to Dr Chia about the pain in his lower back (TP198). Dr Chia examined his lower back but was not able to do any more until the swelling had subsided. Mr Portolesi remembered being prescribed some medication on that occasion by Dr Chia, but could not recall what that medication was (TP18). Dr Chia’s records show that he prescribed antibiotics to Mr Portolesi (TP198).
Mr Portolesi stated in evidence that he recalled taking some time off work for “a week or two” but could not recall precisely when. He said that he attempted to go back to work in his normal capacity after the attack but “found it hard” (TP18). In cross-examination Mr Portolesi stated that he was sure he was at work for a few days immediately after the attack and then had a couple of days off without obtaining a medical certificate for WorkCover purposes (TP74-75). Mrs Portolesi recalls Mr Portolesi having a few days off after the attack and then a few more days off after the family returned from their holiday in Queensland in November, 1998 (TP220). WorkCover certificates indicate that Mr Portolesi had three days off from 29th November, 1998 to 2nd December, 1998 (exhibit D16).
Symptoms and effect on Mr Portolesi’s lifestyle
Mr Portolesi said his symptoms now include pain in his lower back and across his shoulders (TP25). (I note and rely upon the opinion of Mr Osti that unless there was a contemporaneous complaint of shoulder or neck pain, it is unlikely that this was caused by the dog attack, although it is possible for pain to radiate to other areas of the body). He says that he is unable to do much work in the capacity of a service technician and is restricted to light duties. He has a lump at the back of his left knee, however, it is unclear from the evidence whether Mr Portolesi thinks this lump was a result of the dog attack. He stated that it was not there on the first occasion he saw Dr Chia after the attack (TP25). Mr Osti, an orthopaedic surgeon, gave evidence that it is unlikely that this is a result of back injury (TP125). I accept that evidence. The bite itself healed quickly and there is no ongoing injury relating to the actual dog bite (TP25).
Mr Portolesi gave evidence that the accident has affected his personal and social life. He is unable to do some activities with his family and children which he did previously, including playing sport and walking (TP24). Before the accident he and his family would take a long walk after dinner. He stated that he is not able to walk as far or for the length of time he did in the past and, more recently, he has not been able to go on evening walks at all (TP24). He occasionally is able to play sport with his children and not suffer any pain afterwards (TP25).
Mr Portolesi and his family went on a holiday to Queensland which had been arranged before the dog attack (TP34). Mr Portolesi found the flight difficult and was not able to go on rides with his children (TP35).
Mr Portolesi also suffers pain when he drives and has difficulty getting in and out of his work van (TP33). There are also a number of jobs around the house that he has not been able to finish because the work would aggravate the pain in his back (TP33).
In March of this year Mr Portolesi visited his general practitioner for depression. He said that he was at his wit’s end and just wanted to get his life back (TP97). Dr Chia prescribed anti-depressant medication.
Fear of Dogs
Mr Portolesi testified that he now suffers from a fear of dogs as a result of the attack. He states that since the injury he does not go into premises that have a “Beware of Dog” sign (TP23). At one point he gave evidence of calling before going to a job to see if they had any dogs (TP23).
If Mr Portolesi were required to work as a service technician, he states that he would be restricted in the type of calls and repair work that he would be able to do. He stated in evidence that, if he was required to lift heavy equipment such as stoves or fridges, he would try to do it but would not be able to do it for long (TP30). He said that climbing ladders, which is a requirement of his work from time to time, causes him pain in his shoulders (TP30). Working in confined spaces, which is again a requirement of the work of a service technician, causes him pain and he is unable to do this work (TP31).
Mr Portolesi gave evidence that he and his wife planned to build up the business of Masterpass and then sell the company after 5-10 years, at which point he would return to working on his own as a service technician. He does not feel that he will be in a position to do that now (TP34).
Treatment for injury
Following Mr Portolesi’s initial treatment immediately after the dog attack, he next attended at Dr Chia’s practice on 3rd December, 1998. Mr Portolesi’s recollection of events is that he attended Dr Chia’s surgery at another time before 3rd December, however, there is no note in Dr Chia’s records to reflect this (TP73, 199). Mr Portolesi next attended at Dr Chia’s surgery on 28th January, 1999. On this occasion Dr Chia arranged for Mr Portolesi to have an X-ray of his spine on the following day (TP91, 199). Mr Portolesi again saw Dr Chia on 11th February, 1999. On this occasion Dr Chia arranged for a CT scan, however, he did not receive the results of the scan. Dr Chia was unsure whether Mr Portolesi ever attended to have the CT scan (TP199). WorkCover records indicate that Mr Portolesi claimed for the three visits on 3rd December, 1998, 28th January, 1999 and 11th February, 1999 (TP87). There was no other attendance at Dr Chia’s surgery until March, 2003, at which time Dr Chia prescribed anti-depressant medication (TP97). Mr Portolesi described how he was at his wit’s end and could not cope. He stated that he just wanted his life back the way it was before the dog attack.
After the dog attack Dr Chia referred Mr Portolesi to a physiotherapist for treatment. Mr Portolesi said in examination-in-chief that he went to the physiotherapist for treatment for eight to ten weeks. WorkCover records (exhibit D16) listing payments made by WorkCover show that Mr Portolesi attended a physiotherapist on five occasions over the period from the 7th to the 18th December, 1998 (TP86). Mr Portolesi maintained that he only saw the physiotherapist once a week for a period of eight to ten weeks (TP87). In any event he said the treatment “....didn’t seem to do anything” (TP19).
Mr Portolesi said he has tried various exercises at home in an attempt to build up strength in his back muscles but this aggravated the pain (TP22). Mr Portolesi stated that he tried water Pilates as suggested by Dr Meegan, who saw him for the purposes of a medico-legal report, however, these exercises did not assist him. It should be noted that Mr Portolesi did not carry out these exercises in a manner as recommended by Dr Meegan (TP93).
Mr Portolesi gave evidence that he was prescribed painkillers by Dr Chia on at least one occasion (TP22). Mr Portolesi stated in evidence that he was open to all suggestions for treatments and that he just wanted to “get my back back and get my life back on track” (TP92). There is no evidence that he sought treatment other than the four visits to Dr Chia between October, 1998 and February, 1999, and the more recent consultation in March, 2003.
Mr Portolesi stated that he would not take the risk of having injections or surgery. He described that he was worried about the consequences of surgery and did not want to consider that as an option (TP21). Mr Osti does not recall discussing surgery with Mr Portolesi and, in his opinion, Mr Portolesi does not require surgery (TP124, 133). Mr Portolesi expressed similar concerns about Dr Meegan’s suggestion that injections may assist to alleviate the pain (TP21). When it was put to Mr Portolesi that the pain was not so bad that he would need to consider these treatments, he replied that the pain was bad but that he would prefer to live with it rather than end up being in a wheelchair or dead (TP94).
Voluntary services performed by Mrs Portolesi
Mrs Portolesi gave evidence that she massages Mr Portolesi’s back a few times a week, depending on how bad the pain is. She generally uses a heat cream when massaging his back. There are no receipts for any creams. (TP225).
Medication/ Prescriptions
Mr Portolesi gave evidence that he has taken a range of pain-killers and anti-inflammatory medication and creams over the last five years. He gave evidence that he took Panadeine Forte which requires a prescription. There is no evidence of visits to a doctor to get prescriptions for Panadeine Forte. Mrs Portolesi gave evidence that she was prescribed Panadeine Forte by her general practitioner for headaches and that, from time to time, Mr Portolesi would take some of her tablets (TP223). There is no documentation in the form of prescriptions or receipts for any medication taken by Mr Portolesi for back pain (TP76). I found Mr Portolesi’s evidence on the topic of being prescribed and using Panadeine Forte quite inconsistent and confusing. He said he obtained prescriptions for Panadeine Forte from Dr Chia, but there is no record of them or receipts for their purchase (see TP76-83).
Previous injuries/ illness
Mr Portolesi denied in cross-examination that he went to the doctor for stress difficulties or that he was having trouble with time management and work before the attack (TP49). However, he accepted that Dr Chia may have advised him to take some time off because he was overdoing it at work (TP48). He stated that he thrives on work and working hard (TP49). Dr Chia’s records reveal that Mr Portolesi saw him or his locum on a number of occasions in the 1980’s, early 1990’s for stress related matters, including tension headaches, anxiety and exhaustion (TP202-206). He was advised on occasions that he should take some time off work and look at his time management (see exhibit P2).
Mr Portolesi had a previous injury to his knees as a result of having to kneel for long periods of time when working at Foodland as a school student (TP42). He gave evidence that he had been advised that he could have his knees treated, however, he decided that he would live with the occasional periods of pain rather than have continual treatment (TP43). Medical records indicate that Mr Portolesi attended at the practice on two occasions, in November, 1986 and June, 1987, complaining of pain in his knees (TP202). He stated that he can still kneel and squat and does not allow the discomfort to alter his work practices, however, sometimes the pain in his knees is aggravated (TP43, 45).
Evidence was given concerning an incident where someone fell down stairs and hurt their back. This incident was recorded in Dr Chia’s notes for Mr Portolesi, the plaintiff. Mr Portolesi suggested that this may have been his son whose name is Rocky Portolesi. It may also have been a cousin (TP15). Dr Chia conceded that it may have been a mistaken entry and that he had not had the time to check his notes against the accounts. The defendant does not make anything further of it and I have disregarded it.
Mrs Thulborn
Mrs Michelle Thulborn was called by the defendant. She gave evidence that she engaged Masterpass to carry out repairs on a front-load washing machine in around June/July, 2001. She gave evidence that Mr Portolesi came to her house to inspect the washing machine. He was unable to fix it on site so he returned on a later date to take the machine to the business premises. Mr Portolesi did not have anyone else with him on the occasion he returned to collect the washing machine. Mr Portolesi used a sack truck to manoeuvre the machine and load it into his van. Mrs Thulborn did not actually see Mr Portolesi load the washing machine onto the trolley, or into his van.
During the six week period Masterpass had the washing machine for repairs, Mrs Thulborn dealt only with Mr Portolesi (TP259). Mr Portolesi was the technician who returned the washing machine, again with the aid of a sack truck/trolley (TP260). Mr Portolesi did not have anyone with him when he returned the washing machine (TP260).
Mrs Thulborn has two dogs, a miniature fox terrier and a red heeler. She said that no-one from the office enquired whether she had dogs (TP257). She said that there may have been some general conversation with Mr Portolesi about the dogs but he did not express to her any fear of the dogs (TP263).
Mr Portolesi does not recall doing this job (TP113). However, he admitted that, with the right equipment (a sack truck), it is the type of thing he would try to do for work purposes. He said that if he was having a bad day there was no way he could have performed the manoeuvre (TP115-6). What can be said about this evidence is that it is illustrative of the heavy nature of the work undertaken by Mr Portolesi and that a back injury or aggravation of a naturally occurring degenerative condition would not be unexpected.
Mr Portolesi and Masterpass – business/work
After leaving school, Mr Portolesi obtained an electrical apprenticeship with a company called Vulcan and continued to work for that company after it changed its name to Southcorp Whitegoods. Mr Portolesi was a salaried employee up until around 1989 at which time Southcorp changed its hiring system from hiring employees to using sub-contractors. As a result, Mr Portolesi and his wife established the company Masterpass Pty Ltd, trading as High Voltage Electrical, which worked as a sub-contractor for Southcorp. Mr and Mrs Portolesi are the sole directors and shareholders of Masterpass. At this time the business was run from the family home (TP217). Southcorp would organise the service calls and inform their sub-contractors where they were required to attend (TP38). Southcorp did not prevent their sub-contractors from working for other companies (TP40). Over this period of time Masterpass advertised for other work under the trading name of High Voltage Electrical and Security and conducted a business of service and repair of electrical goods and installation of security systems (TP40). Mrs Portolesi carried out an administrative role and Mr Portolesi was the sole service technician. Generally, the business is conducted directly with customers or, in the case of warranty work, manufacturers calling and arranging for a service technician to attend at premises and either repair electrical goods on site or, in some cases, it is necessary to remove the goods to repair them.
In approximately 1996/97, Masterpass broke away from Southcorp and began working on repairs and warranty work for St George (TP218). At this point the business was still conducted from their family home. At some point the company rented shop-front premises and also commenced a business of selling spare parts over the counter (TP218). Masterpass accepted work from a number of companies doing both warranty repairs and “chargeable” work. Mrs Portolesi gave evidence that the company was paid less for warranty repairs as it was paid for by the manufacture (TP228). At this point Mr Portolesi was employed as the sole service technician. Mrs Portolesi carried out the administrative work and Cathy Portolesi worked part‑time in the office answering the telephone (TP14, 219).
From time to time Masterpass hired other technicians to assist with service calls. Financial records for 1998 reveal that Masterpass spent $4,715.40 in sub-contractors’ salaries. Mr Portolesi gave evidence that a colleague, Paul Rogers, with whom he had worked at Southcorp, needed some work and Masterpass tendered for, and won, a large wiring job that could not have been done by one person. This was done in order to help Mr Rogers get some work (TP51). It was a one-off job for which Masterpass would not have tendered but for the fact that Mr Portolesi and Mr Rogers were going to work together. Masterpass received payment for the work and paid Mr Rogers a wage as a sub-contractor. Mr Rogers also worked for Masterpass on matters other than the large wiring job. Mr Portolesi said that Mr Rogers did two or three wiring jobs and some service calls. Mr Portolesi stated that Masterpass would not have accepted those jobs had Mr Rogers not been working for them at that time (TP54). Mr Rogers may have worked for Masterpass for a period of about three to four months (TP54).
Masterpass also employed Mr Portolesi’s brother, Patrick Portolesi, for a period of time leading up to and immediately after the dog attack. Patrick Portolesi was working for Masterpass as a tradesman’s assistant in order to gain qualifications as a service technician (TP55). His role was to assist Mr Portolesi on service calls. He would occasionally deliver parts for the company, but did not work in the capacity of a service technician unless supervised by Mr Portolesi (TP56-57).
Another man, who was referred to as Angelo, was employed as a tradesman’s assistant in 1998 in order that he could obtain qualifications as an electrician (TP60, 219). Mr Portolesi was unclear in his evidence as to what times Angelo worked for the company, however, he stated that Patrick and Angelo worked for the company at different times. It was put to Mr Portolesi that Masterpass employed Angelo in around May, 1998, a few months prior to the dog attack, but he was uncertain about it (TP60).
Masterpass hired a number of people from time to time to work in the office to take telephone calls from customers, arrange service calls and general administrative functions. Service calls were booked through the office (TP59). The office staff dealt with the sales aspect of the company, selling spare parts to customers (tradesmen) (TP59). The evidence is not entirely clear on who was hired and when. Cathy Portolesi worked on administrative tasks. Another woman, Elaine, seems to have worked on alternate days to Cathy Portolesi. There were also two or three women employed as receptionists, however, probably only one was at the office at any one time (TP101, 105). Kristie and Michelle also worked as receptionists (TP101). Treena replaced Michelle (TP105).
Work after the dog attack
Mr Portolesi and his wife, Rachael Portolesi, came to the conclusion that, given Mr Portolesi’s inability to perform the work of a service technician, they would need to employ another person to replace Mr Portolesi. Mr and Mrs Portolesi had discussed the prospect of hiring another technician in any event in approximately 12 months but the accident forced this to happen earlier. Masterpass employed Darren Davis in November, 1998 (TP27). There have been different figures offered as to the amount Masterpass paid Darren Davis. Mr Portolesi said in evidence it was $38,000 (TP28). Mrs Portolesi stated it was $37,000. These figures may include superannuation. In Mr Gibbs’ report referred to later, he calculates the salary of a service technician at $645 per week. There were a number of set-up costs for the new employee, including a vehicle, shelving, tools and sign-writing for the vehicle. There is some discrepancy between Mr and Mrs Portolesi’s evidence relating to the cost of these items. It is Mrs Portolesi’s recollection that the vehicle was purchased second‑hand for approximately $6,000, whereas Mr Portolesi’s evidence was that the vehicle cost around $15,000. Shelving, tools and sign-writing probably came to a few thousand dollars (see TP28 (Mr Portolesi) and TP225-226 (Mrs Portolesi) for various individual amounts).
In mid-2000, Masterpass hired another service technician, Paul Sutcliffe (TP28, 70). The hiring of the second technician was not as a result of the accident, or in the nature of a replacement for the work the plaintiff was unable to perform, but rather as a result of the increasing amount of work Masterpass was getting. Darren Davis was replaced by Eric Procock in September, 2002. He worked for the company for a short period of time and then they hired Dale Ross who still works for the company as a service technician (TP106).
Mr Portolesi gave evidence that, after Davis was employed, he (Mr Portolesi) continued with some lighter duties. He said that before the accident he was doing around 15 call-outs per day. Immediately after the accident he thought he may have done around eight to ten call‑outs per day but more recently he has only been able to do two to three and that there would be some days where he was not able to do any call-outs (TP20). He gave evidence that Davis was only able to do around ten calls per day (TP71). Rachael Portolesi was able to corroborate this evidence (TP222). The amount of work done by Mr Portolesi since the incident was very much in issue at trial. However, the job cards which are filled out by the service technician and which would reveal precisely how many call-outs Mr Portolesi was able to do before and after the accident and how many call-outs Davis was able to do, were not produced (TP246). Mrs Portolesi’s evidence was that these cards are kept at the business premises (TP246). Neither was Darren Davis called to give evidence about the number of calls he was able to do in one day. Mr Portolesi stated in evidence that he continues to try and do as much work as possible (TP28, 66). In cross-examination the plaintiff denied that he was doing as much work as Darren Davis (TP66). Mr Portolesi does, however, do some call-outs, and does not sit in the office all day doing administrative work (TP111). He stated in evidence that he tries to do as much as he can and that it really depends on how he is feeling on a particular day as to how much he can do (TP111). The office staff are instructed to try to assign Mr Portolesi jobs that will not require heavy lifting (TP112). As a result of the injury to his back Mr Portolesi has spent a greater proportion of his time in the office. This has caused friction between his wife and himself and the staff members who work in the office. Mr Portolesi conceded that the office performs better when he is not around (TP31).
Medical evidence
Mr Osti – orthopaedic surgeon
On examining the CT scan taken in December, 1999, Mr Osti diagnosed Mr Portolesi with a Postero Central Protrusion at L3-4. This was protruding onto the thecal sac which is the central part of the nerve structure (TP121). A disc protrusion is a natural manifestation of the ageing process. Certain activities, such as heavy lifting or repetitive bending, can aggravate the condition and accelerate the natural ageing process. It was Mr Osti’s opinion that, given the type of work Mr Portolesi does, it is “quite plausible” that his work may aggravate his condition (TP122). That evidence was in the context of Mr Portolesi’s work in general as opposed to the specific incident that he asserts caused the onset of pain. Mr Osti said in evidence that, given the nature of the work that Mr Portolesi engaged in, it was possible that he was at greater risk of back injury (TP132).
Mr Osti first assessed Mr Portolesi as suffering from a 10 per cent loss of function of his lumbar spine. It was his opinion that, with a 10 per cent loss of function, Mr Portolesi could continue to work full-time as a service technician, but that certain activities, such as heavy lifting, would tend to exacerbate the pain (TP122, 130). At a later time, Mr Osti had the opportunity to examine an MRI Scan taken in May, 2001. Mr Osti is now of the opinion that Mr Portolesi’s condition has deteriorated and that he now has a disability of 20 per cent loss of function of his lumbar spine (TP135). Mr Osti stated that he did not believe that he discussed surgery with Mr Portolesi, but he may have mentioned it in one of his reports (TP124). However, his opinion is that the plaintiff does not require surgery (TP133).
In cross-examination Mr Osti said that he had no evidence that Mr Portolesi suffered from any neck pain as a result of the dog attack. He stated that it is possible that the incident aggravated a previous injury or made Mr Portolesi aware of a problem with his neck that he had not noticed previously (TP135). He said that, unless the shoulder or neck pain was complained of immediately after the dog attack, it is unlikely to have been caused by the attack (TP135). Mr Osti said that, even with a 20 per cent loss of function, as long as the plaintiff remains physically active and mentally well, he can live a normal life and that the prognosis is reasonably good (TP134, 136).
Mr Osti was asked questions on the basis of a factual history that is different from the one upon which he proceeded. Mr Osti stated that had the plaintiff returned to work after the attack without restrictions and had not taken two weeks off, had not returned to his doctor until December and had not complained of pain, it would cause him to question the relevance of the dog attack to the onset of pain (TP128-129). It is possible that there is a delay of a few hours between the incident and the onset of pain, however, had the delay been longer than that, up to a few weeks, Mr Osti would again question the relevance of the dog attack to the pain complained of by the plaintiff (TP127-128).
Dr Meegan – occupational physician
Dr Meegan diagnosed a disc bulge of L3-4 impinging on the thecal sac (TP127). It is possible to have this condition and be asymptomatic. In Dr Meegan’s opinion the twisting as a result of the dog attack triggered off an asymptomatic degeneration of Mr Portolesi’s spine (TP174). Dr Meegan initially assessed Mr Portolesi as having a 10 per cent loss of function of the lumbar spine. Upon examining the more recent MRI scan, Dr Meegan said that there has been a deterioration in Mr Portolesi’s condition and that he now has a 20 per cent loss of function of the lumbar spine (TP173-174). This deterioration could be explained by the type of work Mr Portolesi does, or by the natural ageing process (TP174). This deterioration is accompanied by an increase in pain suffered by Mr Portolesi (TP173). Dr Meegan stated that it is possible for someone with this condition to aggravate it by some action and then recover and it be aggravated on a later occasion (TP175). However, he stated that it would be his advice to patients suffering from the condition who were asymptomatic to go about their normal lives and not act in a restricted way (TP179).
The defendant questioned Dr Meegan on aspects of the history given to him by Mr Portolesi. Dr Meegan’s report indicates that the plaintiff told him that he had taken four to five weeks off work after the dog attack. Dr Meegan said that had Mr Portolesi not taken this time off it would indicate an “index of lesser severity at that time” (TP177). Dr Meegan gave evidence that, given the type of pain complained of, he would have expected the plaintiff to have had regular medical treatment (TP181). Dr Meegan said that the plaintiff did not complain to him of neck or shoulder pain. In his opinion, had this pain been caused by the dog attack he would have expected a complaint contemporaneous with the attack (TP184).
Dr Durkin
Dr Durkin examined Mr Portolesi at the request of QBE Workers Compensation Insurance (TP187). Dr Durkin assessed him as having a 20 per cent loss of function of the lumbar spine. Mr Portolesi told Dr Durkin that he was having to take two to three Panadeine Forte a day (TP188-189). Dr Durkin did not consider it was probable that Mr Portolesi could have recovered from the aggravation caused by the dog attack and that another incident, unrelated to the dog attack, was the cause of the pain from which he is now suffering. His opinion is based on the nature of the pain described by Mr Portolesi. He was prepared to acknowledge it was a possibility, but not a probability (TP195). It was Dr Durkin’s impression that the plaintiff was a stoic individual, and the fact that Mr Portolesi did not seek treatment does not cause him to alter his opinion of his disability.
Dr Schembri – psychiatrist
Dr Schembri diagnosed Mr Portolesi as suffering from anxiety as a result of the pain, concern for the future and a fear of dogs. Dr Schembri describes this as an acute stress reaction, similar to but milder than a post-traumatic stress disorder. It is possible that psychological or psychiatric treatment may assist Mr Portolesi deal with his fear of dogs. Mr Portolesi does not recall Dr Schembri’s advice that psychological counselling may assist him in this matter (TP110).
It was Dr Schembri’s belief that Mr Portolesi had not had any previous difficulties with stress before the dog attack. Dr Schembri stated that had the plaintiff previously experienced difficulties with stress or tension, it would have been relevant to his final opinion as it indicates there were problems with anxiety and stress before the attack (TP212). Further, he stated that, had the second service technician been hired because the business was growing and not because of a disability suffered by the plaintiff, it would indicate that the overall impact of the dog attack on Mr Portolesi was less than Dr Schembri had understood (TP213).
Dr Glenn McCulloch - neurosurgeon
Dr McCulloch did not give evidence and his report dated 11th December, 2002 became exhibit D11. Dr McCulloch saw Mr Portolesi on the one occasion, on 9th December, 2002.
Dr McCulloch’s view is that the physical findings are more in keeping with an L5‑S1 disc bulge than an L3-4 disc bulge. He said that Mr Portolesi’s symptoms may have arisen from a musculo-ligamentous strain. Assuming an aggravation of the disc bulge, the onset of symptoms would be immediate but the symptoms could also worsen over a period of some days. He said: “One would not expect a situation where there was no pain for some days and then the development of pain some days or weeks later (this is not the history provided to me).”
Dr McCulloch went on to say that there was pre-existing degeneration “....but his history as provided suggests some sort of causal relationship with the incident with the dog.” He diagnosed a 10 per cent loss of function of the lumbar spine as a consequence of this injury. No surgical treatment was required.
Accounting evidence
Mr Andrew Gibbs
Mr Gibbs was called by the plaintiffs. His reports became exhibits P12 and P13. Mr Nick Cooper (“Mr Cooper”) was called by the defendant. Mr Cooper also prepared two reports, one dated 13th December, 2002 and the other 26th March, 2003, both of which became D15.
In terms of sequence, the first report was P12, the second was the first part of D15 (dated 13th December, 2002), the third was P13 and the fourth was the second part of D15 (dated 26th March, 2003). I propose to consider these reports and the supporting oral evidence below, but the main points are these.
In exhibit P12, Mr Gibbs has calculated that, after the date of the injury, Masterpass found it necessary to engage a qualified service technician to take the place of Mr Portolesi resulting in past losses to Mr Portolesi of $186,859 gross (over four separate financial years to 2002), being a net loss after tax of $127,998. Added to that amount would be a further amount for the 2002/2003 financial year, but I have not been told what that should be. Interest would then be payable to judgment.
Secondly, Mr Gibbs performed a similar calculation concerning future losses to Mr Portolesi. He made the calculation on the basis that Mr Portolesi is restricted to light duties and that has necessitated the employment of an additional full-time service technician. He calculated there was a net loss of $441.82 per week. On that basis the present value of that loss to a male aged 35 years and ceasing work at age 65 years, with a compound interest rate of 3 per cent per annum, taking into account mortality, is $458,609.16. In all, past and future losses amount to $586,607.16 plus a further amount for the year to 30th June, 2003 plus interest on the past loss.
Finally, Mr Gibbs agreed that Masterpass had not suffered any loss (TP146). (See also Mr Cooper to the same effect TP266, 280-1, 284-5.)
Mr Nick Cooper
Mr Cooper puts forward competing opinions in two ways. First, Mr Cooper says that the method of calculating the past and future economic loss to the plaintiffs displays a flawed methodology and that the losses claimed by them “....have not been calculated upon a reasonable basis and are fanciful (D15, report of 13th December, 2002 at p.2). Further, Mr Cooper performed his own calculations and expressed the opinion that the only possible loss to either plaintiff (past or future) was a loss of $3,355 (net of tax) to Mr Portolesi. In his view the company did not sustain any loss (see above).
Mr Gibbs considered Mr Cooper’s first report and wrote (in exhibit P13) that nothing in that report caused him to alter any of the conclusions in his first report.
Mr Cooper responded to Mr Gibb’s second report and reiterated his earlier views (see D15, report of 26th March, 2003).
I return to these reports and opinions later.
Discussion - nature and effect of the injury
As mentioned, it is not disputed that, on 29th October, 1998, Mr Cordeaux’s dogs bit Mr Portolesi and that a minor wound was caused to his right calf. He was given a tetanus injection and antibiotics. The bite resolved fairly quickly and uneventfully (Dr Chia TP198).
There seems no reason to doubt that Mr Portolesi sustained a lower back injury as the result of an attempt to evade the jaws of the dogs. He was carrying a heavy tool‑box at the time. Mr Portolesi went to see Dr Chia that afternoon and complained about the lower back pain.
Mr Portolesi next saw Dr Chia on 3rd December. The pain was still present and the doctor organised physiotherapy. It appears that Mr Portolesi attended the physiotherapist from 7th to 18th December, 1998 (see D10). On 3rd December Dr Chia certified that Mr Portolesi “....will be incapacitated for work from 29/11/98 to 2/12/98.” Further, Dr Chia also certified that Mr Portolesi “....is fit to return to modified duties from 2/12/98 to 15/12/98” (see D16).
In between the date of the incident on 29th October, and 3rd December, Mr Portolesi and his family went on a pre-booked holiday to Queensland, particularly the Gold Coast. The pain was still present during that period but Mr Portolesi did not consult a doctor. They were away seven days.
Mr Portolesi next saw a doctor when he returned to Dr Chia on 28th January, 1999 complaining that his back was worse (TP199). Dr Chia’s report says that “Examination was unremarkable neurologically” (see P1). Mr Portolesi was due to return to Dr Chia on 4th February, 1999 but failed to attend and turned up instead on 11th February when X-rays were taken. He was also sent for a CT scan but Dr Chia did not know if Mr Portolesi attended or the result.
Mr Portolesi did not see Dr Chia again until 19th March, 2003. He complained of lower back pain and the stress it was causing to his wife and children. The doctor’s notes (P2) are difficult to read and he gave no oral evidence on this point. Mr Portolesi claims that, prior to seeing Dr Chia again, he had been seeing a doctor next door to his office, Dr Simmons (TP25, 81-82). Dr Simmons was not called and there was no explanation as to why he was not called. As the evidence stands, there is no evidence of Mr Portolesi attending any doctor for the purpose of treatment on his back between about 11th February, 1999 and 19th March, 2003. That is a four-year period without explanation.
I specifically find that Mr Portolesi did not take any time off work until early December, 1998 and even then for only a few days. This finding is contrary to the basis upon which some of the medical specialists formed their opinions. The cross-examination on this point is referred to above.
I have not lost sight of the fact that Mr Portolesi attended upon many specialists in that period, but they were for the purpose of medico-legal reports and not for the purpose of treatment.
During the period February, 1999 to March, 2003, Mr Portolesi gave evidence that he experienced ongoing pain from the incident in October, 1998, he took medication to help with the pain, he undertook light duties only/administrative work and there was no other incident that caused the ongoing pain. In other words, the incident in October, 1998 was the only injury, and that caused the pain which in its turn led to the incapacity and loss.
The defendant acknowledged the possibility that the injury caused a minor, short‑term incapacity (and possibly loss), but that there was insufficient evidence to prove, on the balance of probabilities, that this incident caused any incapacity and loss. This challenge has a number of facets, including an examination of the improved financial position of the company suggestive that Mr Portolesi was doing a lot more work than he claimed, thereby impacting on the claimed incapacity and loss, as well as credibility.
The first point has already been touched upon. There is no evidence before me that Mr Portolesi attended any doctor during a four-year period for treatment on his back. Further, he took no time off until early December, 1998.
The second point is allied to the first, namely, that there is no evidence of Mr Portolesi being prescribed Panadeine Forte during this four-year period despite his assertions that he was taking significant quantities of them over an extended period for the ongoing and unremitting pain from the back injury. Panadeine Forte is only available on prescription. I do not accept Panadeine Forte in these quantities came from Mrs Portolesi. The use of other painkillers seems to have been spasmodic on his evidence. I also note in Dr Durkin’s report (P5) that Mr Portolesi said he was taking two to three Panadeine Forte per day.
The third point is allied to the first and second. In response to the defendant’s submission that there is no evidence of visits to the doctor for treatment in that four‑year period, on behalf of the plaintiffs it is said that Mr Portolesi was a stoic person who could do light duties and bear the pain. I do accept that Mr Portolesi was hard‑working, but I do not accept that he was stoic. The history of his attendance upon the family doctor suggests a readiness to seek treatment for minor ailments, some involving no more than discomfort and little or no pain. If he had had significant pain over this period, even if intermittent, I have no doubt he would have consulted Dr Chia or the doctor next door to the business, Dr Simmons. The specialists to whom he was sent diagnosed a certain percentage loss of function of the lumbar spine but that was not sufficiently significant for him to go to the doctor.
The next point relates to the financial performance of the company after the incident in conjunction with the employment of another service technician, supposedly to do the work Mr Portolesi was unable to do and the actual amount of work Mr Portolesi says he was doing. Some discussion of the facts is necessary to put the submission in context.
Mr Portolesi said that, prior to the incident in October, 1998 he was doing between 13 to 17 call-outs per day. For my purposes I have averaged that at 15 call‑outs per day in the absence of documentary records. After the incident it dropped dramatically to eight to ten, but it is now two to three and light duties. Some days he could not go out at all. In my view it is a fair assessment of the evidence that Mr Portolesi said he was doing about five to eight call-outs per day from about early 1999, but then down to about three per day in recent times.
As mentioned earlier, Masterpass employed another service technician, Darren Davis, in November, 1998. Both Mr and Mrs Portolesi said Davis was only able to do about ten call-outs per day (TP71, 222). Mrs Portolesi said that Mr Portolesi was doing less and less calls per day and that he and Davis were not keeping up with the calls. Another service electrician, Paul Sutcliffe, was employed in mid-2000 (TP222). Sutcliffe also was able to do about ten call-outs per day. Therefore, with Davis working and Mr Portolesi still doing his call-outs, between them they were doing call‑outs about equal to or a bit more than that which Mr Portolesi was able to perform before the incident. Once Sutcliffe came on board, he and Davis were doing about 20 call‑outs per day between them. Even if Mr Portolesi was doing about five to eight call‑outs per day from mid-2000, then the three of them were doing less than twice what Mr Portolesi could do before the incident. However, as appears from the financial position of the company outlined below, it was going from strength to strength, and Mr Portolesi was being paid much the same salary as he was before the incident (except for some of 1999).
I have included and annexed to this judgment “Appendix 2” to the report of Mr Gibbs of 13th August, 2002 (P12). It is a Summary of Trading Income and Expenditure for Masterpass for the years ended 30th June, 1997 to 2002 (inclusive). Mr Gibbs prepared that summary from the tax returns of the company and the parties have accepted and used the summary as accurately representing the financial activity and position of the company. I proceed on the same basis. To assist in understanding the evidence and my conclusions, I have added the following words - “Gross Profit” for the amounts shown for each year, commencing with $84,314 in 1997; “Net Profit” for the amounts shown across the bottom line for each year, commencing with $644 in 1997. I note again that this incident occurred on 29th October, 1998.
The gross profit increased from $114,427 in 1998 to $196,564 in 1999 when Mr Portolesi was then doing eight to ten call-outs per day and Mr Davis doing only ten. At best between them they were doing about five more call-outs per day than Mr Portolesi could do by himself, yet there was a 70 per cent increase in gross profit.
The more likely situation is that Mr Portolesi and Mr Davis were, by the early part of 1999, doing no more than about that which Mr Portolesi could do himself, which makes the 70 per cent increase in gross profit all the more remarkable. In the same period, the cost of sales only increased marginally, yet the gross turnover increased from $185,540 to $273,409, an increase of about 45 per cent.
In terms of net profit for the same period, the company turned around a loss of $7,850 to a profit of $12,855, that is, a turnaround of about $20,000.
On the evidence, Sutcliffe was not employed until mid-2000, therefore the 1999‑2000 financial year was simply Mr Portolesi and Davis, with Mr Portolesi gradually doing less. Without undertaking the same analysis, again the financial position of the company improved with the gross turnover, gross profit and net profit increasing significantly.
During the 2000-2001 financial year there was a small increase in the gross turnover and gross profit, but a significant increase in the cost of labour (consistent with Sutcliffe’s employment) and a big drop in net profit.
During the 2001-2002 financial year the gross turnover increased dramatically, but much of that is accounted for in the cost of sales, consistent with the expansion and increased quantity of sale of spare parts.
The substance of the point made on behalf of the defendant is that the increased amount of work being undertaken by Masterpass must mean that Mr Portolesi was doing much more than he said he was doing. On the other hand, the plaintiffs contend that there was a shift in the way Masterpass operated and charged that explains the improved gross turnover, gross profit and net profit.
There are three aspects to the changing nature of the business of Masterpass. First was the gradual shift from warranty work to normal customer work referred to as “chargeable” work. Secondly, the amount able to be charged for either warranty work or “chargeable” work increased. Thirdly, the sale of spare parts was also an increasing area of operation. Whilst I am prepared to accept that those three factors had an effect on gross turnover, gross profit and net profit, they do not satisfactorily explain the improved position (although net profit dipped in the 2001 year).
For present purposes, the improved gross turnover and gross profit show an increased amount of work being undertaken by the company. That increase is not explained by the three factors referred to above or by the amount of work being done by Davis and, later, Davis and Sutcliffe. On this point the conclusion to which I have come is that the plaintiff, Mr Portolesi, was doing substantially more work than he was prepared to disclose in the evidence. I note that the plaintiffs had the opportunity to produce the job cards or computer print-out for Mr Portolesi, Davis and Sutcliffe but failed to do so (Mrs Portolesi TP245-6). Neither Davis nor Sutcliffe gave evidence.
In this and other regards the defendant relies upon the judgment of the Full Court in Giorginis v Kastrati & Another (1988) 49 SASR 371 at 374-5 (per Von Doussa J) and 379 (King CJ and Legoe J). Von Doussa J made these observations (at 374-5):-
“The burden of proof rests on the plaintiff. Where damages are claimed for a loss of earning capacity, the plaintiff must prove the extent of his pre-accident earning capacity, the extent to which that capacity would have been productive of income had the accident not happened, and the extent to which the compensable injuries have diminished his ability to exercise the pre-accident earning capacity. It is necessary to emphasise that these matters cannot be satisfactorily proved by medical experts alone. There must also be evidence to prove the basic facts on which the medical opinion depends, and the circumstances of the plaintiff which are necessary to translate the medical opinion into findings of fact pertinent to the assessment of damages for a loss of earning capacity. Medical opinion alone as to the plaintiff’s pre-accident and post-accident capacity for work cannot prove the extent to which the plaintiff’s earning capacity has been exercised in the past, or the extent to which his residual earning capacity is likely to be exercised in the future. In a case like the present one, it is incumbent on the plaintiff to show how he has used his capacity for work both before and after the accident. The plaintiff will be well advised to produce the best evidence available. That will include whatever records exist as to his pre-accident and post-accident earnings and other income. If a plaintiff attempts to give oral evidence on these topics from memory, unaided by records which are in his possession or power, he invites the opposing party, and the court, to question his evidence. If the records are lost or destroyed it behoves the plaintiff to obtain the information from the sources which lie in his power, or to establish that the information cannot any longer be obtained. Such information can usually be obtained from the Australian Taxation Office, employers, parties with whom the plaintiff has contracted, banking records, and so on.
If a plaintiff does not adduce evidence of this kind which is in his power or possession many uncertainties are likely to remain. It does not necessarily follow, as a matter of law or fact, that proof of the plaintiff’s claim for lost earning capacity will fail. The evidence may nevertheless establish, on the balance of probabilities, the likelihood of some substantial element of loss, and the court will take that into account in assessing general damages: Russell v J Hargreaves and Sons Pty Ltd (1956) 30 ALJ 533. However, the assessment is likely to be a modest one having regard to the uncertainties unnecessarily left open by the evidence. The plaintiff will usually not be heard to complain on appeal that the loss may have been greater. In some cases the failure to adduce the supporting evidence may well cause the court to feel unable to accept the oral evidence of the plaintiff, at least at face value. The plaintiff and his advisers carry a heavy responsibility to ensure that this type of material is properly marshalled together in advance of the trial, and where it is not admitted, to have it introduced into evidence.”
The medical evidence tends to establish that Mr Portolesi suffered a lower back strain as the result of this incident. However, the reports and assessments made for medico-legal purposes are, in my view, insufficient to prove a connection between the incident in October, 1998 and those assessments. No doubt their later observations and opinions are consistent with the October, 1998 incident, however, they have not had the benefit of seeing Mr Portolesi give evidence at length and were not provided with all the material made available at trial.
In the end I am not satisfied that the injury suffered in the incident caused any more than intermittent pain over about a three to four month period. That injury resolved by about the end of February, 1999. At most the incident and injury caused a temporary partial incapacity, probably by aggravating a pre-existing condition. Thereafter, there is no proved loss of earning capacity. He recovered from the injury in that three to four month period. For reasons that are discussed below however, I am not satisfied that any temporary loss of earning capacity has been productive of any more than a small financial loss to Mr Portolesi: Malec v J C Hutton Pty Ltd (1990) 169 CLR 638; Medlin v The State Government Insurance Commission (1994-1995) 182 CLR 1. In my view Mr Portolesi deliberately exaggerated the injury, pain and incapacity from this incident. I did not find him to be a satisfactory witness. Further, the absence of attendance upon a doctor for treatment in a four-year period or evidence of obtaining a prescription for Panadeine Forte for pain (when he previously went to the doctor quite readily) weighed heavily with me. I reject Mr Portolesi’s evidence that he did not go to the doctor because there was nothing they could do and he just became used to the pain (TP83-84).
In view of these findings it is not necessary to say much about the accounting evidence. However, in case I am thought to be wrong about those findings, I propose to say something about that evidence. I will endeavour not to repeat matters already covered.
A consideration of the accounting evidence is necessary to the extent that I have found that the incident caused a temporary partial incapacity for about a three-month period. The question is whether that has been productive of financial loss to either plaintiff. (The question of general damages is considered below.)
Past economic loss - Mr Portolesi
It is common ground that the plaintiff, Mr Portolesi, continued to be paid a wage by Masterpass after the incident. His wages (taken from his tax returns) for the 1996, 1997 and 1998 tax years were as follows: $26,700, $29,000 and $30,900. For the 1999 year (which included this incident), it fell to $26,000 and then up to $30,000 for the 2000 year. On that basis Mr Portolesi’s wages dropped by $4,900 gross in the year of this incident. In the absence of any other explanation, I find that this loss is attributable to the incident and partial incapacity. The net amount after tax is $3,355 and I award that for past economic loss for Mr Portolesi. I award lump sum interest of $1,000.
As touched upon, Mr Gibbs, in his report P12, suggests that Mr Portolesi has sustained a past net loss of $127,998 (up to and inclusive of 2002). Mr Cooper, in his report D15, comments on Mr Gibbs’ methodology and calculation. I agree with the criticisms made by Mr Cooper of Mr Gibbs’ methodology. Those criticisms do not require repetition.
Past economic loss - Masterpass Pty Ltd
Mr Gibbs’ first report (P12) is not entirely clear, but it appears to assert that any losses have been sustained by Mr Portolesi and not Masterpass. His evidence was to the same effect, although he said “....Masterpass has not incurred any significant loss” (TP146). At no stage did he endeavour to quantify any loss to Masterpass, so, strictly speaking, there is no evidence of loss.
Concerning Mr Cooper, he has always been of the view that Masterpass has not sustained any past losses (see D15 para.7.3).
I find that Masterpass did not sustain any past economic loss.
Future economic loss - Mr Portolesi
As before, I find myself in agreement with Mr Cooper’s calculation (showing no loss) and in disagreement with Mr Gibbs.
Further, I do not accept the premise upon which Mr Gibbs proceeds. Not only do I not accept that Mr Portolesi is restricted to light duties, even if he had a partial incapacity attributable to this incident, there is no evidence that it has been productive of any financial loss into the future.
I find that there is no future economic loss to Mr Portolesi.
Future economic loss - Masterpass Pty Ltd
Neither Mr Gibbs nor Mr Cooper suggest that Masterpass will have any future loss of income caused by this incident.
General damages - Mr Portolesi
I have already dealt with the injury and its immediate aftermath. There was certainly pain and discomfort over a period of about three to four months. There was the initial wound that healed uneventfully. Mr Portolesi attended the physiotherapist on a number of occasions. Hydrotherapy was not carried through.
I have already found that there was a temporary partial incapacity. I accept that there was a temporary acute stress reaction. However, I do not accept that Mr Portolesi has any fear of dogs, although I do accept he is wary of them.
I award $2,000 by way of general damages, together with lump sum interest of $500.
In view of my findings, I make no award for gratuitous services. In any event there is no measure for the cost of those services.
Also in view of my findings, I decline to make any allowance for past medical expenses for pain-killers and creams.
Conclusion
As to the claim by Mr Portolesi, I award $2,500 by way of general damages and interest. I award $4,355 by way of past loss, including interest. There will be judgment for Mr Portolesi for $6,855.
As to the claim by Masterpass Pty Ltd, its claim is dismissed in all respects. There will be judgment for the defendant against the company.
I will hear the parties on the question of costs.
Appendix “2”
MASTERPASS PTY. LTD.
TRADING AS ‘PRESTIGE APPLIANCE REPAIR CENTRE’
SUMMARY OF TRADING INCOME & EXPENDITURE
FOR THE YEARS ENDED 30TH JUNE
1997 1998 1999 2000 2001 2002 Gross Turnover $126216 $185540 $273409 $400322 $432226 $548499 Less Cost of Sales 42054 71407 76845 120047 132473 211887 $ 84162 $114133 $196564 $280275 $299753 $336612 Add Profit on Sale of Asset - - - - - 15429 Insurance Recovery - - - - - 4381 Interest 152 294 - 7 366 66 Gross Profit $ 84314 $114427 $196564 $280282 $300119 $356488 Less Cost of Labour Directors Wages 58000 61800 52000 60000 45300 62000 Others Wages - 12325 57602 75965 121023 136747 Superannuation 2553 4428 6579 10579 12895 15969 $ 60553 $ 78553 $116181 $146544 $179218 $214716 % to Gross Turnover 47.9% 42.3% 42.4% 36.6% 41.4% 39.1% Overhead Expenses 23116 39009 63732 96796 99262 107707 Contractors - 4715 3796 1547 1930 632 $ 83669 $122277 $183709 $244887 $280410 $108339 Net Profit $ 644 $ (7850) $ 12855 $ 35395 $ 19709 $ 33433
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