Reynolds v Comcare
[2006] SADC 136
•15 December 2006
DISTRICT COURT OF SOUTH AUSTRALIA
(Civil)
REYNOLDS v COMCARE
[2006] SADC 136
Judgment of His Honour Judge Soulio
15 December 2006
DAMAGES - MEASURE AND REMOTENESS OF DAMAGES IN ACTIONS FOR TORT - MEASURE OF DAMAGES - PERSONAL INJURIES
Action for damages resulting from the plaintiff's terminal medical condition - the plaintiff was employed by the South Australian Railways Commissioner between 1956 and 1961 and was exposed to asbestos particles in the course of that work - the plaintiff was diagnosed with mesothelioma in 2005 - the defendant had assumed the liabilities of the SARC and admitted liability - however the defendant denied that it had assumed any liability for Sullivan v Gordon damages pursuant to s9(3) of the Dust Diseases Act 2005 - measure of general damages for pain and suffering, loss of amenity and loss of expectation of life - approach to and measure of deduction for maintenance when assessing damages for loss of future earning capacity during the "lost years" - measure of damages for voluntary services and Sullivan v Gordon damages.
Ewins v BHP Biliton Ltd [2005] SASC 95; Kite v Malycha (1998) 71 SASR 321 at 340; Van Gervan v Fenton [1992] 175 CLR 327 at 333; Sharman v Evans (1977) 138 CLR 563 at 582; James Hardie & Co Pty Ltd v Roberts (1999) 47 NSWLR 425 at 445; Commonwealth v TransAdelaide (2001) NSWCA 52 , considered.
REYNOLDS v COMCARE
[2006] SADC 136
The plaintiff, Mr Reynolds, contracted mesothelioma as a result of exposure to asbestos products during the course of his employment with the South Australian Railways Commissioner (“SARC”) at the Islington Railway Workshops between 1956 and 1961.
The Dispute
Proceedings were instituted on 15 June 2006 and the plaintiff’s evidence was taken on commission prior to the filing of a Defence. Initially, liability was denied.
Shortly prior to trial, an Amended Defence was filed admitting that SARC had breached its duty of care to the plaintiff; and admitting that the defendant had assumed the liability of SARC, but alleging that the assumption of liability did not extend to the plaintiff’s claimed entitlement to damages pursuant to section 9(3) of the Dust Diseases Act 2005.
Accordingly, the matter proceeds essentially as an assessment of damages, the principal areas of dispute, in addition to the issue of liability for section 9(3) damages, being the approach to quantification of the award for pain and suffering, the extent of the care provided and to be provided to the plaintiff, and the quantification of the award for loss of earning capacity during the “lost years”.
The Evidence
The transcript of evidence of the plaintiff taken on commission, by his Honour Judge Chivell, on 4 September 2006, at the plaintiff’s residence, was tendered. The plaintiff’s wife and son gave evidence.
In addition, evidence was given on behalf of the plaintiff by Ms Anne Morgan, occupational therapist, Dr Kevin Patterson, oncologist, and Dr Holmes, respiratory physician. A number of medical reports were tendered, including reports of Dr Antic tendered by the defendant.
I generally accept the evidence of the plaintiff whilst acknowledging that that evidence was given, and tested, in difficult circumstances for the plaintiff, having regard to the progression of his condition.
Perhaps not surprisingly, given the nature of that condition, the medical evidence is not particularly controversial.
Findings
The plaintiff was born on 20 February 1940.
After leaving the employment of SARC in 1961, the plaintiff worked for some 15 years as a plant operator for two different employers. He then worked as a lawn mower repairer and salesman for some seven years before commencing his own business Reynolds Mowerland in 1983, and then Trevor Reynolds Pty Ltd in 1985 until that business failed in 2002.
It is to the considerable credit of the plaintiff and his wife that upon the failure of the business in Mt Gambier, they used their superannuation savings to pay their creditors. As Mrs Reynolds said:
We didn’t owe anybody anything when we left the business in Mt Gambier and walked away with our heads high.
The dissipation of the superannuation savings in that way, no doubt forms part of the reason for the plaintiff’s stated intention to continue working well past the usual retirement age.
At the time of the manifestation of the plaintiff’s disease, he was working as a tow truck operator, as the principal of his own company, subcontracted to Dial‑a‑Tow. That arrangement commenced in 2003. He had intended working until age 70 years, and had entered into an arrangement with Centrelink whereby he would be paid a lump sum as a bonus for working rather than taking the age pension until reaching the age of 70 years.
Prior to September 2005, he had enjoyed reasonably good health. In September 2005, when he was 65 years of age, he suffered what was thought initially to be a chest infection involving shortness of breath and chest pain. He was treated with antibiotics. He appeared to recover.
In November 2005, following a fall during the course of his work as a tow truck operator, he again sustained shortness of breath. He was initially diagnosed with suspected pneumonia. An x‑ray revealed pleural effusion in the right lung. His condition worsened, and by 28 November 2005, he had developed severe chest pain and shortness of breath. He underwent x‑rays, an ultra sound, and a CT scan. He was referred to a physician, who admitted him to the Lyell McEwin Hospital, where a significant quantity of fluid was drained from the plaintiff’s right lung on 30 November 2005.
On 19 December 2005, a further x‑ray at the Lyell McEwin Hospital demonstrated a further accumulation of fluid in the lung, and the plaintiff’s physician referred him to Dr Jurisevic, a cardiothoracic surgeon, who examined the plaintiff on 5 January 2006. The following day, the plaintiff was in such pain that he was unable to sleep and was admitted to the Lyell McEwin Hospital for three days. He was transferred to the Royal Adelaide Hospital thereafter, where he underwent a video assisted thoracotomy and a talc pleurodesis during which time, again, a significant quantity of fluid was drained.
Following an analysis of the fluid, the plaintiff was diagnosed with mesothelioma and was informed of that diagnosis on 11 January 2006. He remained in the Royal Adelaide Hospital until 16 January 2006.
The plaintiff underwent radiotherapy in February and March 2006, but by May 2006 was suffering increasing pain. He had travelled to Mt Gambier together with his wife, to visit his children and grandchildren. On the return journey he experienced such difficulty, that he was required to stop overnight in Keith.
In his affidavit sworn 1 September 2006, the plaintiff described himself as being relatively pain free during the period from late March 2006 until mid‑June 2006. Thereafter, however, his condition deteriorated substantially. He was re‑admitted to the Lyell McEwin Hospital on 12 June 2006, and then transferred to the Royal Adelaide Hospital with renal failure. He remained there for a period of one week.
Thereafter, in late July 2006, upon the recommendation of Dr Patterson, he underwent chemotherapy and subsequently was admitted to the Lyell McEwin Hospital in mid‑August for blood transfusions necessitated by the effects of chemotherapy. He also underwent a course of chemotherapy in late August 2006, and was again admitted for blood transfusions for extended periods in September, for a shorter period in October 2006 and again in November 2006.
Since June 2006, he has had reduced mobility, initially requiring the use of walking frame, and subsequently requiring the use of a wheelchair, and assistance in moving from bed to chair, as well as some assistance with showering, dressing and toileting.
The plaintiff has required since late August occasional use of oxygen equipment to assist him breathing.
It was common ground at trial that the plaintiff had a life expectancy of some 10 weeks.
It was also common ground that the plaintiff was in the process of entering the terminal stage of his disease. The nature of the condition is that it causes very significant pain. There has been some success in managing that pain by the use of frequent and substantial doses of morphine. The plaintiff experiences a constant background of pain, has entirely lost his appetite and is sustained essentially by liquid foods prepared by his wife. He has difficulty in breathing, and is confined to either a bed or recliner chair.
It is the plaintiff’s stated intention, and that of his wife and son, that the plaintiff will be cared for at home, until his death. He clearly has a caring and supportive family, who are prepared to care for him in that way, and on the basis of the medical evidence that no radical medical intervention will be of benefit, I find that that is the likely arrangement for his care for the balance of his life.
DAMAGES
Pain and Suffering and Loss of Amenity
Counsel for the plaintiff made the initial submission that in awarding damages under this head, I should have particular regard to decisions of the Dust Diseases Tribunal of New South Wales, such as Mulley v James Hardie & Co Pty Ltd[1] where the plaintiff was awarded $150,000 and Smith v Sydney Water Corporation Ltd[2] where the plaintiff was awarded $200,000 under this head.
[1] Unreported Judgment of Johns J delivered 26 June 2000
[2] Unreported Judgment of Curtis J delivered 20 September 2000
He conceded, however, that I was generally bound to follow the approach of the Chief Justice in Ewins v BHP Billiton Ltd & Wallaby Grip Ltd[3].
[3] [2005] SASC 95 (17 March 2005)
In Ewins, Doyle CJ accepted the argument that the award of damages under this head must be made having regard to the general level of damages awarded in this State.
He cited the reasoning of Cox J in Packer v Cameron[4]:
There is no obvious or natural relation, of course, between the experience of pain and a particular sum of money. There is no logical reason why a man’s non-economic damages, for any given loss, should be assessed at $10,000, say, rather than half of that amount, or double. In the end the foundation for any particular assessment is that it is reasonably proportionate to the damages that have been awarded in other cases that are more or less comparable with the plaintiff’s, although the overall standard may be subject to periodic revisions to accord with the courts’ appreciation of the general level of damages awards that the community, as represented by the insured motorists, can fairly be expected to accept. We were referred to the oft-quoted judicial statements that eschew tariffs and emphasise the need to fasten on the situation of the particular claimant and not the situation of other claimants in other actions. See, for example, Planet Fisheries Pty Ltd v La Rosa (1968) 119 CLR 118. However, no-one has suggested that damages can sensibly be assessed by some kind of innate impulse. The court in Planet Fisheries (supra) acknowledged that ‘a judge who is making an assessment will be aware of and give weight to current general ideas of fairness and moderation’ (at 125), which must be an allusion to a general knowledge of other cases. … Certainly the High Court discountenanced any attempt to establish on appeal the correctness or otherwise of an award by comparing it with specific cases, but that is another matter: cf Hirsch v Bennett [1969] SASR 493 at 497-499; and Moran v McMahon (1985) 3 NSWLR 700. The changes made by s 35a have to be read, therefore, against the background of a legal system in which awards in comparable cases within the same judicial system – and that does not mean only similar cases – create the broad standard by which any particular plaintiff’s loss is to be measured in money terms, and in which a general consistency between awards for comparable losses remains a desirable goal.
[4] (1989) 54 SASR 246 at 250-251
In Ewins[5] in declining the invitation by counsel for the plaintiff there to “move to a new level of damages under this head”, Doyle CJ said:
… First, as Cox J said in Packer v Cameron, I must make an award of damages that is not only proportionate to the injuries suffered, but also that bears an appropriate relationship to the overall level of awards made in this State. To do otherwise would be to ignore my responsibility as a trial judge. Second, were I to apply a higher level or standard of damages, it would follow as a matter of consistency that that approach should flow through to other cases. It is not possible to apply one general standard to cases of mesothelioma, and a different and lower standard to other personal injury cases. It is the function of the Full Court, and not of a single Judge, to decide whether the general level of damages should be increased.
[5] At para 70
In Ewins, the plaintiff was 71 years of age when his condition was diagnosed in November 2004. He had commenced experiencing symptoms in early 2003 and had experienced increasing difficulty in breathing, had undergone investigative procedures, and by late 2004, was in fairly constant pain. He was, nevertheless, able to walk for short distances, perform minor tasks around the house and drive his car. He faced the prospect of ongoing treatment. His life expectancy at trial in March 2005 was about six months. The total period from the onset of symptoms to the termination of his life expectancy was about 2 ½ years.
I have set out, in broad terms, the procedures undergone by the plaintiff here, and described briefly the nature of his symptoms. His symptoms will worsen. As I have said, at the time of the initial diagnosis he was 65 years of age, was enjoying work, travelled to Mt Gambier on at least two occasions each year to spend time with his extended family which included eight grandchildren, and enjoyed the company of his wife in attending the home matches of the Port Adelaide Football Team as season ticket holders, and enjoyed his hobbies and activities. He and his wife were planning to spend some time travelling around Australia upon his retirement at 70 years of age. The manifestation of his disease has had a devastating and catastrophic effect upon him.
I see no reason to differentiate substantially between the plaintiff’s award of damages under this head and the damages awarded in Ewins. Whilst some regard should be had to the period for which the symptoms are suffered, and here the course of the plaintiff’s condition in total will be some 17 months, there are aspects of the impact of the disease upon the plaintiff here which may well have warranted a greater award. I award the sum of $100,000 damages for pain and suffering and loss of amenities.
Of that award, $70,000 is to be allocated to the past and $30,000 to the future. I allow interest at the rate of 4% for half the period since the onset of symptoms in September 2005 in the sum of $1,750.
Loss of Expectation of Life
It was agreed between the parties that had it not been for the plaintiff’s compensable condition, his life expectancy was 17 years.
In Kite v Malycha[6] Perry J said:
Having regard to the decision of the High Court in Skelton v Collins, and the line of authority in which it has been followed or applied since then, the award under this head must be moderate.
[6] (1998) 71 SASR 321 at 340
In Ewins the Chief Justice described the award of damages under this head as being determined by reference to a figure or a standard established by a series of decisions as about the right amount under this head.
Having regard to the purpose of the compensation, namely for the loss of, in this case, 17 years of life, the general level of awards are low.
I am constrained by that approach, and I award the sum of $15,000.
Past Special Damages
Past special damages are agreed in the sum of $6,970.93.
Future Medical and Equipment Expenses
Future medical and equipment expenses, including the cost of hire of an electronically operated hospital style bed and recliner are agreed in the sum of $6,375.
Past Economic Loss
The plaintiff tendered without challenge, on this topic at least, the report of Mr Rossetto, an expert accountant. On the basis of the earnings history of the plaintiff’s business, Mr Rossetto calculated the plaintiff’s loss to the date of trial, net of taxation, in the sum of $24,551 from 1 January 2006 to the date of trial.
I find that the evidence properly underpins Mr Rossetto’s opinion, and the appropriate award, rounded up to allow for the few days since the trial, is $25,000.
Interest is allowed at the rate of 6%, for half the period, in the sum of $750.
Future Loss of Earning Capacity
The evidence of Tanja Hitchcock, a proprietor of Dial‑a‑Tow was presented in a tendered statement, unchallenged. She described the plaintiff as one of her most efficient and hard working contractors, who was fit and had no problems performing the work required. She said that the availability of work had been consistent.
As I have said, it was the position of the plaintiff and his wife, that the plaintiff intended working to the age of 70 years, before accepting the pension bonus payment to which I will refer below, and thereafter embarking upon a holiday.
The defendant accepted, and I find, that that would have been the case.
That is the starting point. Counsel for the plaintiff submitted that the calculation of losses performed by Mr Rossetto included a 15% deduction for vicissitudes on the basis that that was the standard practice in New South Wales, and made the submission that in the absence of a standard reduction of that nature, the negative contingencies were balanced by positive contingencies and that the full amount should be awarded.
Counsel for the defendant argued that there should be a reduction for vicissitudes in any event.
The plaintiff’s work was described by his wife as heavy work. The plaintiff had previously had an angioplasty although he gave evidence that there were no ongoing health problems.
Counsel for the plaintiff sought to identify, as positive contingencies, factors such as the plaintiff’s supportive family, the previous dissipation of superannuation savings necessitating ongoing work, and the enjoyment of his work, as counter balancing the negative contingencies of possible illness and non-compensable injury which might require earlier retirement.
In my view the factors identified by counsel for the plaintiff go more to establishing the starting point, namely that the plaintiff would have worked to age 70 as intended, but for illness or non-compensable injuries.
Having regard to the nature of the work, and the plaintiff’s age I am of the view that a small reduction for contingencies should be made and propose to reduce the award of damages under this head by 10%.
The plaintiff would have reached the age of 70 years on 20th February 2010. Accordingly that is the date until which he intended working.
I accept the calculations of Mr Rossetto, that the plaintiff’s net weekly loss is $545.15. Accordingly, his loss for the next 10 weeks or so is, in round terms $5,500. I award that amount for that period.
Thereafter, the plaintiff’s living expenses or “maintenance” must be deducted from the net weekly earnings, in order to arrive at an appropriate award for future loss of earning capacity for the “lost years” beyond the date of his anticipated death. [7]
[7] Fitch v Hyde-Cates (1982) 150 CLR 482)
The plaintiff’s evidence is that his basic living costs amounted to $120 per week.
At trial I admitted into evidence information relating to the rental cost of accommodation approximately equivalent to that occupied by the plaintiff and his wife. Counsel for the plaintiff submitted that the evidence of rental costs demonstrated that one half of the weekly cost of renting equivalent accommodation was $60 to $75 per week, that being the plaintiff’s share, and that, together with half of the expenditure on food and utilities, resulted in an appropriate calculation of maintenance in the order of $125 to $145 per week, which could then be deducted from the net weekly income for the purposes of calculating future losses.
Counsel for the defendant sought to rely on the evidence of the plaintiff, in cross-examination, to the effect that the income he had earned in the tow truck business had been spent on maintaining himself. The following passage appears:
QMaintaining yourself means the basics.
AYes.
QIt means paying the electricity and the basic foods and those sorts of materials.
AI manage to pay my bills.
QJust not really to save anything more than above that.
ANot a great deal.
Having regard to the fact that the plaintiff was, at the time of the onset of his symptoms, the principal earner, and had been married to his wife for some 40 years, I view his responses in cross-examination as referring to the financial circumstances of the family unit.
The defendant’s submission was that there should be no award for future loss of earning capacity during the “lost years” on the basis that the plaintiff had conceded that there were no savings, and that all of his income was spent on the maintenance of what he described in general terms as the relatively simple living standards of the plaintiff and his wife.
I reject that submission.
Where, as here, evidence was that $230 per week was expended on payment of a mortgage (albeit that the house and the loan were in the name of the plaintiff’s son), and that the plaintiff and his wife expended part of the plaintiff’s income on football club membership, on attending football games, on the maintenance of pets, on dining out once per week, on travelling to Mount Gambier a couple of times a year, and on purchasing gifts for their grandchildren, an overly literal reliance on the apparent concession by the plaintiff that his income was spent on the basic necessities is not warranted.
In Sharman v Evans[8] Gibbs J and Stephen J said:
In these circumstances, it would, we think, be wrong to treat Skelton v Collins as any authority for the proposition that only surplus income, in effect savings, are to be taken into account in assessing economic loss in the “lost years”.
[8] (1977) 138 CLR 563 at 582.
And also said[9]:
We share the difficulty felt by Sheppard J and have concluded that properly regarded Skelton v Collins does not require that anything, other than the cost of the plaintiff’s own maintenance should go in reduction of damages for lost earning capacity in “lost years”.
[9] At 581.
In Fitch v Hyde-Cates Mason J said[10]:
However, there are solid grounds for thinking that the true measure of the deceased’s loss is not the amount which he would have in his hands to spend, distribute or save, after defraying his probable living expenses and those of his dependents, but the amount of his future earnings less his probable living expenses to enable him to earn future wages. As this Court has said on many occasions in the past, the deceased is entitled to compensation for his loss of earning capacity, not loss of wages. This loss of earning capacity is reflected in a loss of earning capacity or perhaps a reduced earning capacity in the years of life that remain and a loss of earning capacity in the years of which the victim has been deprived. Once the relevant loss is identified as a loss of earning capacity there is a difficulty in saying that there should be deducted future expenditure on the living expenses of the deceased’s dependents as well as future expenditure on his own living expenses which should be regarded as an essential condition of the exercise of his earning capacity.
[10] (1982) 150 CLR 482 at 498.
In commenting on that passage, Sheller JA in James Hardie & Co Pty Ltd v Roberts[11] said:
In my opinion, Mason J clearly equated the living expenses which were deductible with those which would have enabled the deceased to earn future wages or which should be regarded as an essential condition of the exercise of the deceased’s earning capacity. No doubt the living expenses to enable a company executive to earn a future salary would be different from those to enable a rural worker to earn future wages. In that sense the standard of life which the job and career prospects would suggest the deceased was reasonably likely to achieve must be taken into account.
[11] (1999) 47 NSWLR 425 at 445.
There are likely to be some other items of essential expenditure. In my opinion the appropriate assessment of maintenance, in the sense of living expenses which should be regarded as an essential condition of the exercise for the plaintiff’s earning capacity, is $150 per week.
Accordingly the plaintiff’s weekly loss during the “lost years” is $545.15 per week less $150 per week, namely $395.15 per week. The multiplier is approximately 145 taking into account a slightly earlier starting date than that allowed by Mr Rossetto. After making a 10% reduction for vicissitudes I award $51,500 for the “lost years”.
In addition, as part of the plaintiff’s future economic loss, it was conceded by the defendant that the plaintiff was entitled to be compensated for the loss of the payment he would have received under the Commonwealth Government’s Pension Bonus Scheme, had he been able to work as intended to the age of 70 years. The Pension Bonus amount would have been $26,132.50. Mr Rossetto has calculated the present day value of that bonus as $23,781. I reduce that amount by 10% for the reasons discussed above, producing an award of $21,402.90.
The award for future loss of earning capacity is made by adding the three separate sums referred to above, a total of $78,402.90.
Care and Services
A report of Ms Morgan was tendered setting out proposed care models for the plaintiff depending upon an assessment of the stage of the progression of his condition, and his level of dependency. She frankly conceded in cross-examination that she had not treated patients suffering from mesothelioma, but had on many occasions prepared assessments of the care needs of such patients.
Her report and her evidence need to be considered against the background of the evidence as to the plaintiff’s level of dependency, and the services that have been provided to him both by members of his family, and by Domiciliary Care Services.
In Van Gervan v Fenton[12] the Court said:
Because the market cost of services is ordinarily the reasonable and objective value of the need for those services, the market cost, as a general rule, is the amount which the defendant must pay as damages.
[12] [1992] 175 CLR 327 at 333 (joint judgment of Mason CJ, Toohey and McHugh JJ citing Mason J in Griffiths v Kerkemeyer)
It was put on behalf of the defendant, that in using commercial rates to assess the award of damages for voluntary services, the GST component charged by a care provider agency should be deducted, as to do otherwise would be to grant to the plaintiff a windfall.
In Van Gervan v Fenton[13] it was an agreed fact, and an approach not criticised by the Court, that the market rate was to be calculated taking into account the daily wages, penalty rates, a 20% loading in lieu of annual leave, sick leave and public holidays, together with an annual workers’ compensation premium, and the cost of board and lodging for the carer.
[13] At 339 in the same joint judgment
By implication at least, the market cost of providing the services incorporates a number of elements which would not be incurred by the voluntary provider of services, and therefore constitute, in the defendant’s terms, “a windfall”. Similarly, a reduction would have to be made for the income taxation component of any payment, if the defendant were correct. I do not regard myself as having any warrant to depart from the approach that the starting point for the assessment is that of the market cost of providing the services including any GST component.
The plaintiff’s affidavit evidence was to the effect that as at 1 September 2006, he had difficulty walking between his living room and bedroom. He required oxygen breathing assistance from time to time. He was unable to shower, dress himself, or go to the toilet without assistance. He required the use of a wheelchair to traverse anything other than nominal distances, and was unable to drive.
In the period from the time of diagnosis up until May 2006, with the obvious exception of those occasions during which the plaintiff was hospitalised, including for a surgical pleurodesis, his wife gave evidence that he had not been severely incapacitated. As I have said he drove to Mt Gambier with his wife in May 2006 to visit his family. He developed constant pain and had difficulty breathing. The holiday was cut short, and the plaintiff drove back as far as Keith, but could not go on. Because of the levels of his pain, he and his wife stayed overnight in Keith and she drove for the rest of the journey to Adelaide. From the time of the hospitalisation in June 2006, the plaintiff’s wife has assisted the plaintiff in relation to his personal hygiene, to dressing him, and attending to assist in many of the activities of daily living.
By the time of trial, the plaintiff essentially spent his time confined to bed, and to a recliner chair. He had ceased eating solid foods, and survived on liquid food prepared by his wife. Either she or a family member stayed with the plaintiff to provide assistance on a virtually continual basis. At night, the plaintiff, from time to time, requires assistance in adjusting his position, and assistance with the provision of medication, toileting, and the obtaining of drinks.
Mrs Reynolds estimated that on average she would spend half an hour per night attending to such needs. However, I note that in cross‑examination. Mrs Reynolds agreed that once the plaintiff had been provided with medication, he slept through the night on most nights.
Whilst the plaintiff is visited twice per week by a palliative care nurse, that nurse checks oxygen levels, blood pressure, and discusses the course of his condition. She does not replace the active care, or stand‑by assistance provided by the plaintiff’s family.
It is appropriate to assess the value of the care provided, taking into account that differing levels of care have been needed, for example: care provided during periods of hospitalisation; care provided from the end of November 2005 until the plaintiff’s deterioration in late May 2005 and subsequent hospitalisation in mid‑June 2006; the period from the hospitalisation in mid‑June 2006 until the swearing of his affidavit on 1 September 2006 and the taking of evidence on commission on 4 September 2006; the period from that time until the time of trial; and the allowance for future care based on the evidence of his current life expectation.
I have taken into account the evidence of the plaintiff described above, the evidence of Mrs Reynolds regarding the services provided, the evidence of the plaintiff’s son, together with the medical evidence regarding the plaintiff’s state of health, and need for assistance. There is always some difficulty in making an award of damages under this head, based on any precise calculation, when such calculation is in turn based upon assumptions made by an occupational therapist, or estimates given in the witness box by the provider of voluntary services, as to the number of hours per day or per week spent in various activities.
As Perry J said in Kite v Malycha[14]:
While the damages to be awarded on the principle identified in Griffiths v Kerkemeyer are, speaking generally, to be quantified by reference to the ordinary commercial cost of the provision of such services, the award must be maintained within reasonable limits. It must be recognised that some services rendered, for example, services rendered intermittently at very early or late hours during the day would be difficult to meet by the provision of commercially available services.
I will not attempt to itemise the hours involved, or catalogue the minutiae of assistance which Mrs Kite has been given to which regard might be had under the two headings referable to this aspect of the matter.
[14] (1998) 71 SASR 321 at 351.
Further, as was observed in the joint judgment of Gleeson CJ, Gummow and Heydon JJ in CSR v Eddy[15]:
First the principle of Griffiths v Kerkemeyer is controversial as evidenced by the number of legislative reversals or qualifications of it.
There is also judicial dissatisfaction with it. It can produce very large awards – some think disproportionately large compared to the sums payable under traditional heads of loss.
[15] [2005] HCA 64 at para 26
I award damages for past care and services in the sum of $50,000.
I award interest on that amount at the rate of 6% in the sum of $1,800.
As to the future, on the basis of the evidence as to expectation of life, and the plaintiff’s deteriorating condition and need for ongoing care, partly active and partly passive, I award the sum of $35,000.
Sullivan v Gordon Damages
Section 9(3) of the Dust Diseases Act (SA) 2005 provides:
Despite any other Act or law, the Court must, when determining damages in a dust disease action, compensate, as a separate head of damage, any loss or impairment of the injured person’s capacity to perform domestic services for another person.
Note-
This subsection is intended to restore the effect of Sullivan v Gordon (1999) 47 NSWLR 319[16].
[16] Section 9(3) in fact appears to broaden the category of persons for whom domestic services were performed by an injured plaintiff, by compensating the plaintiff for the loss or impairment of the plaintiff’s capacity to perform domestic services “for another person”, whereas in Sullivan v Gordon, Mason J observed that different considerations probably apply in the case of persons for whom no legal obligation of care exists and who are not members of the plaintiff’s household being cared for at the time of the accident (for example, aging parents).
The transitional provision of the Dust Diseases Act is in the following terms:
(1)This Act (and the amendments made by this Act) apply to causes of action arising and actions commenced before or after the commencement of this Act.
(2)However, subclause (1) does not apply to an action commenced before the commencement of this Act if the trial has commenced before the commencement of this Act.
The Dust Diseases Act came into operation in February 2006. It applies to the present action.
On the face of it, the plaintiff is entitled to Sullivan v Gordon damages.
The defendant ultimately admitted liability for the claim but by its defence sought to make the following qualification:
The defendant admits that it has assumed the liability of the SARC for his breach of duty to the plaintiff but says that this does not extend to the plaintiff’s claimed entitlement to damages pursuant to s9(3) of the Dust Diseases Act 2005 (SA).
The defendant contends that it is necessary to consider the mechanism by which the Commonwealth of Australia came to assume the liabilities of the SARC.
An agreement was made on 21 May 1975 in broad terms, for the transfer from the State Transport Authority and the South Australian Railways Commissioner, of South Australia’s non‑metropolitan railways to the Australian National Railways Commission.
The agreement was enshrined in two pieces of related legislation.
In relation to the assumption of liability by the Commonwealth, the Railways Agreement (South Australia) Act1975(Cth) provided by s8:
The Commission shall, on and after the declared date, be subject to all liabilities and obligations incurred by South Australia or a state authority before that date in connexion with the administration, maintenance and operation of the non‑metropolitan railways and of any services (including passenger and freight road services) that are principally or mainly incidental or supplementary to, or principally or mainly operated in associated with, those railways, to the extent to which those liabilities and obligations are not discharged before that date.
The “declared date” was 1 March 1978.
The Railways (Transfer Agreement) Act 1975 (SA) provided by s7:
On and from the declared date the State and each state authority is, by force of this section, freed and discharged from all liabilities and obligations incurred by it, and not discharged before that date, in connexion with the administration, maintenance and operation of the non‑metropolitan railways and of any services that are principally or mainly incidental or supplementary to, or are principally or mainly operated in association with, those railways, to the extent to which the Commission becomes subject to those liabilities and obligations on and from that date.
Put simply, the defendant’s contention is that the liability of the ANRC was a liability in accordance with the law applicable to the SARC as at, at the latest, the declared date of 1 March 1978. The defendant in reliance on CSR v Eddy[17] then says that as Sullivan v Gordon damages were not part of the common law as at 1 March 1978[18], the defendant has no liability to the plaintiff for such damages.
[17] [2005] HCA 64.
[18] CSR v Eddy [2005] HCA 64
If that contention is correct, on my reading of s7 of the Railways (Transfer Agreement) Act (SA), the TransAdelaide which has succeeded to the liabilities of the SARC, will be liable.
The defendant made no challenge to the validity of the Dust Disease Act 2005. TransAdelaide, the ultimate successor to SARC, is not a party to this action. The plaintiff was, of course, not a party to the agreement upon which the defendant relies.
In Colombin v TransAdelaide[19], the plaintiff had sued both TransAdelaide and the Commonwealth of Australia seeking damages for injuries sustained following exposure to asbestos dust and fibre whilst working for the SARC between 1956 and 1964. The plaintiff alleged that the Department of Railways (SA) was negligent, and further, or in the alternative, that the liability for such negligence was transferred and accepted by the Commonwealth.
[19] [2001] NSW DDT 13
Both TransAdelaide and the Commonwealth brought applications for summary dismissal of the claim.
In Colombin, as here, there was no cause of action until the diagnosis of mesothelioma was made, or at least damage was suffered so as to complete the tort, and accordingly as at the declared date, the liability was an inchoate or contingent liability.
In Colombin, the trial judge granted TransAdelaide’s application for summary dismissal, and dismissed that of the Commonwealth.
He relied on Crimmins v Stevedoring Industry Finance Committee[20] which dealt with a claim in somewhat similar circumstances, and where the defendant was alleged to have taken on the liability of the Australian Stevedoring Industry Authority pursuant to section 14 of the Stevedoring Industry Acts (Termination) Act 1997 (Cth) which provided:
The Committee is, by force of this section, liable to perform all the duties and to discharge all the liabilities and obligations of the authority that existed immediate before the expiration of [the transitional] period.
[20] (1999) 200 CLR 1
In Crimmins, Gleeson CJ said[21]:
Depending upon the context, the meaning of ‘liability’ can include a contingent or potential liability (Walters v Babergh District Council (1983) 82 LGR(Eng) 235 (QBD)). Where the legislator in providing for the replacement of the authority by the respondent, stipulated that the respondent was to perform all the duties, and discharge all the liabilities, of the authority, which was abolished and which had no further capacity itself to meet any claims upon it, there was no good reason to distinguish between complete and inchoate causes of action in cases where the authority had committed a breach of a legal duty. Such a distinction is not required by the use of the word ‘liability’, and to give it a narrow construction would defeat the evident purpose of the legislation, which was to preserve the just entitlement of those who had dealings with the authority before its abolition.
[21] At 13-14
And Gaudron J, said[22]:
The word ‘existed’ is not synonymous with ‘were enforceable’. Nor, in my view, should it be so construed ...... those words are capable of meaning not only that the liability or obligation should have been enforceable at the expiration of the transitional period, but that its foundation should then have been in existence. In my view, they should be construed to include that latter meaning.
[22] At 15
The trial judge found that the Commonwealth of Australia had succeeded to the liability of the South Australian Commissioner for Railways in respect of such Acts and omissions and the damage alleged by the plaintiff to have been caused by them.
On appeal, the New South Wales Court of Appeal in Commonwealth v TransAdelaide[23] per Mason P, with whom the rest of the Court agreed, said:
Section 8 of the Railways Agreement (South Australia) Act1975 (Cth) must be read in context. It is one of a bundle of sections designed to give effect to the agreement. So read, it should be seen as part of a legislative scheme designed to ensure a complete, effective and final transfer of assets, liabilities and employees from the South Australian body to the Commonwealth body, as regards Non-metropolitan Railways. With employees it would have been inevitable that some might have been carrying the seeds of illnesses that would later manifest themselves in circumstances giving rise to claims of legal liabilities.
It is not suggested that s8 is confined to financial liabilities. The words ‘all liabilities and obligations’ are, in my view, too broad to exclude tort. On this basis, accrued tortious claims would be transferred. Having regard to the purpose of the agreement and the legislation giving effect to it, it seems consonant with that purpose that inchoate tortious liabilities stemming from acts occurring prior to the transfer should go also. Some of the reasoning in Crimmins supports such a textual and contextual construction of the provision (see in particular per Kirby J at [191] and per Callinan J [365]).
[23] (2001) NSWCA 52 - BC200101609
In considering the Commonwealth’s submissions, Mason P said[24]:
The way the argument in this Court was developed was to look at the South Australian legislation and the fact that the South Australian Statutory Corporation in existence at the declared date, namely the State Transport Authority, remained in existence after that date; and at a later date was continued in existence but with the new title TransAdelaide. This of course is to look at the South Australian side of the equation. It is also to ignore the inferences that perhaps one would draw from the fact that the Railways (Transfer Agreement) Act1975 (SA) provided in s7, which I have already set out above, for in effect a statutory abrogation by the State and each state authority of undischarged liabilities and obligations. Section 7 is obviously to be read as part of the South Australian side of the transfer and as the legislation passed in contemplation of s8 of the Railways Agreement (South Australia) Act1975 (Cth).
I think another difficulty with part of the Commonwealth’s argument is that, as far as the federal legislation is concerned, there was no enactment that would ensure that some South Australian body would remain in existence as regards non-metropolitan Railways. Indeed, the whole thrust of the scheme embodied in the agreement and the two lots of complimentary legislation was that South Australia would exit the scene as regards non-metropolitan Railways.
[24] At 16
I make the observation that if the defendant is correct, given the effluxion of time generally since exposure to asbestos occurred, a significant number of plaintiffs will bring claims against, not the entity directly liable, but the successor of such entity and, depending on the terms of the agreement or legislative scheme involved, will be faced with either joining two or more defendants, or in many cases being left without remedy.
Mason P concluded by saying[25]:
If anything, I see the commercial aspect of the present legislative scheme as one where the financial line was ruled off, money was paid, the staff went over; and it seemed to me more consonant with that approach that the type of tortious liabilities with which this case is concerned should pass to the purchaser rather than remain with the vendor.
[25] At para 19
Mr Letcher QC, for the plaintiff, submitted that if there had been no transfer of responsibility by the State and Commonwealth Acts in 1975, the State would now be liable to pay the damages referred to in s9(3). That is undoubtedly true, the SARC being in no different position than any other employer using asbestos products. Counsel for the plaintiff submitted that there is no stated or implied intention to deal with particular types of damages flowing from such liability because the heads of damage could not be known until the tort was complete by the occurrence of action or damage, which of course did not occur until late 2005.
It was put on behalf of the plaintiff that, whilst the liability to compensate for tort may have been transferred in 1978, the damages are ascertainable only as at the time of trial.
Counsel for the plaintiff relied, in support, on the decisions in Huddleston v Commissioner for Railways[26] and Doro v Victorian Railways Commissioners[27]. However, those cases turned on a statutory increase in the monetary cap on damages which came into effect after the cause of action arose, but was held to apply upon an assessment of the damages, rather than, as the defendant contends is the case here, a “new” head of damages.
[26] (1951) 57 SRNSW 226
[27] (1960) VR 84
Counsel for the defendant contended that such a loss could not have been contemplated by the parties to the agreement. In my view that is by no means clear.
In Bresatz v Prizibilla[28] the husband of a woman injured in a motor vehicle accident appealed against the quantum of the claim for loss of consortium. Owen J:
The award to the husband of $500 for loss of consortium is, I think, also inadequate. He has been permanently deprived of his wife’s services and must henceforth tend to her needs when he is not away from the home at work. The future cost of providing domestic assistance in the house was a factor taken into account by Mayo J in assessing the wife’s damages and, since it was not suggested by any of the parties to this appeal that this item was not properly allocated to her, I have treated it in the same way and put it aside in considering the husband’s loss of consortium. But this does not mean that he is not entitled to substantial compensation for the fact that his wife can no longer manage the household affairs and will never be able to give him the comfort, companionship and assistance in managing the household which he would otherwise have had from her.
Professor Luntz[29] makes reference to the concept of claim by a husband for the loss of services of his wife, and notes:
The husband may recover for the ‘the interest which (he) may be supposed to possess in the conduct by the wife of the household affairs in the performance of domestic duties to his material advantage’. (Toohey v Hollier (1955) 92 CLR 618 at 624).
Some courts have seen this element of servitium as being in the forefront of the husband’s claim today (Cordecco Porcheddu v Hogan (No 2) [1965] QWN 13). A contrary view, that modern social attitudes place more emphasis on society and companionship than services, has been expressed elsewhere (Fisher v Smithson (1977) 17 SASR 223 at 227). There can be no doubt that the husband may recover costs that he has incurred in employing domestic help to replace the lost services of the wife (Best v Samuel Fox & Co Ltd [1952] AC 716 at 733).
[28] (1962) 108 CLR 541 at 550.
[29] Assessment of damages for Personal Injury and Death, 4th ed Butterworths 2002 at para 10.1.5.
As at the declared date s33 of the Wrongs Act (SA) 1936 (now s65 of the Civil Liability Act 1936) provided:
(1)Where a person causes injury to another by wrongful act, neglect or default, he shall (whether or not the injury results in death) be liable in damages to the wife of the injured person for loss or injury suffered by her as a result of the loss or impairment of the consortium of husband and wife.
(2)The damages shall be assessed in the same manner as upon a claim by a husband for damages in tort in respect of loss or impairment of consortium.
Whilst allowing such damages in the injured person’s claim may, to use the expression of the counsel for the defendant, be a concept “not known to the law”, liability for damages which are somewhat analogous in nature, namely the prospect of being required to compensate the spouse of an injured person, for the loss by the injured person of the ability to provide services to the spouse, must have been in the contemplation of the parties to the agreement, within the meaning contended for by the defendant.
In Commonwealth v TransAdelaide it was held that inchoate liabilities were transferred to the Commonwealth. The Commonwealth is liable to pay damages for all that which flows from the injury caused to the plaintiff.
I have come to the view that on the basis that the legislation was validly enacted, the plaintiff is entitled to Sullivan v Gordon type damages. By virtue of the statutory scheme enacted in 1975 giving force to the transfer of liabilities, the defendant stands in the shoes of the SARC. Whether the defendant has some right of action against the State, pursuant to the terms of the agreement, is not a matter which should be the concern of the plaintiff here. The plaintiff is entitled as part of his assessment of damages, to the damages described in s 9(3) of the Dust Diseases Act.
I turn to the quantification of those damages.
In doing so, it is necessary to take care to avoid double compensation. In relation to the period until February 2007 the award of damages for voluntary services includes an allowance in respect of some services which were provided by the plaintiff’s wife prior to the onset of the plaintiff’s condition in any event, but in respect of which a need has now been created. Part of the rationale for compensating the plaintiff in those circumstances, is upon the basis that the plaintiff, by virtue of his condition, is unable to contribute equivalent services to the care provider.
As Dean and Dawson JJ said in Van Gervan v Fenton[30]:
Nor, subject to an important qualification, can domestic services which are undertaken, as part of the mutual give and take of marriage, by persons in a marital relationship for the benefit of one another and of their matrimonial establishment, legitimately be seen as converted into additional services necessary to attend to the accident-caused needs of an injured plaintiff in circumstances where they would have been performed in the same way and to the same extent in any event. The qualification is that such services will be taken out of the area of the ordinary give‑and‑take of marriage to the extent that the injuries to the wife or husband preclude her or him from providing any countervailing services. To that extent, the continuing gratuitous services provided by the spouse assume a different character and should be treated as additional services which have been or will be provided by that spouse to look after the accident‑caused needs of the injured plaintiff.
[30] At 344
In that sense, a proportion of the countervailing services which had been provided by the plaintiff to his wife by way of assistance with the heavier aspects of cleaning, maintaining of the garden and so on, have been the subject of an award under the Griffiths v Kerkemeyer head.
The plaintiff submitted that the appropriate basis for the calculation of the section 9(3) damages, was to calculate such damages for a period of 10 years from the date of trial, namely until a time when the plaintiff would have reached 76 years of age. The claim as proposed included, for example, a claim for shopping for 1.5 hours per week at a total cost of $38.54 per week which, when the ten year multiplier of 451.8 was used, produced a result of some $17,500 to compensate for that lost service. Leaving aside the issue of whether the commercial costs of replacing that service may well be, for example, by arranging for delivery by the supermarket, the evidence of the affidavit evidence of the plaintiff was that his wife had always done the shopping, and that he attended with her and assisted principally apparently by pushing the trolley.
The amount of time spent in gardening, home maintenance, periodic cleaning, setting and clearing the table and so on, suffered from the same difficulty, namely, estimates of the time spent given by Mrs Reynolds in the witness box. I am of course in no way critical of her, but rather simply saying that there is of necessity a lack of provision in such estimates. In addition, such activities were obviously for the benefit of both the plaintiff and his wife.
It is also by no means clear that the plaintiff would have continued providing such services until he reached the age of 76 years.
I am of the view that an appropriate allowance under this head is $15,000.
In summary:
Pain and Suffering and Loss of Amenity $100,000.00
Loss of Expectation of Life $ 15,000.00
Past Special Damages $ 6,970.93
Future Medical and Equipment Expenses $ 6,375.00
Past Economic Loss $ 25,000.00
Future Loss of Earning Capacity $ 78,402.90
Care and Services $ 85,000.00
Sullivan v Gordon Damages $ 15,000.00
Plus interest $ 4,300.00Total $336,048.83
There will be judgment in this action for Mr Reynolds in the sum of $336,048.83 inclusive of interest.
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