Ringelstein v Redford Cattle Co Pty Ltd and Hillterlings Pty Ltd

[1996] QCA 88

IN THE COURT OF APPEAL	[1996] QCA 088
SUPREME COURT OF QUEENSLAND

Appeal No. 224 of 1995

Brisbane

[Ringelstein v. Redford Cattle Co P/L & Anor]

BETWEEN:

DENIS RINGELSTEIN

(Plaintiff) Appellant

AND:

REDFORD CATTLE COMPANY PTY LIMITED

(First Defendant) First Respondent

AND:

HILLTERLINGS PTY LTD

(Second Defendant) Second Respondent

Davies J.A.
Mackenzie J.

Helman J.

Judgment delivered 10/04/1996

Judgment of the Court

APPEAL ALLOWED. ORDER THAT THE JUDGMENT BELOW BE SET ASIDE AND THAT IN LIEU THEREOF JUDGMENT BE ENTERED FOR THE APPELLANT AGAINST THE RESPONDENTS FOR $188,309.55. ORDER THAT THE RESPONDENTS PAY TO THE APPELLANT HIS COSTS OF THE APPEAL AND THE PROCEEDINGS BELOW.

CATCHWORDS:	NEGLIGENCE - damages for personal injury - quantum only - assessment of damages for future impairment of earning capacity.
Counsel:	Mr. D. North for the appellant Mr. D. Newton for the first and second respondents
Solicitors:	Thompson King Connolly for the appellant W. H. Tutt & Quinlan for the first respondent Deacons Graham & James for the second respondent

Hearing Date: 20 February 1996

IN THE COURT OF APPEAL

SUPREME COURT OF QUEENSLAND

Appeal No. 224 of 1995

Brisbane

Before Davies J.A.
Mackenzie J.
Helman J.

[Ringelstein v. Redford Cattle Co P/L & Anor]

BETWEEN:

DENIS RINGELSTEIN

(Plaintiff) Appellant

AND:

REDFORD CATTLE COMPANY PTY LIMITED

(First Defendant) First Respondent

AND:

HILLTERLINGS PTY LTD

(Second Defendant) Second Respondent

REASONS FOR JUDGMENT - THE COURT

Judgment delivered the 10th day of April 1996

On 12 September 1995 in the Brisbane District Court judgment was entered in this action for

the appellant against the respondents for $138,309.55 and costs. The action arose out of a motor

vehicle collision on 25 April 1995 as a result of which the appellant was injured. He claimed

$200,000.00 and interest against the first respondent for breach of a contract of employment and

negligence and against the second respondent for negligence. The learned trial judge reached her

assessment of the appellant's damages as follows: $90,000.00 for general damages for pain and

suffering and loss of amenities of which $40,000.00 was attributable to future impairment of earning

capacity, $2,614.50 for past voluntary assistance and services, $11,900.00 for past impairment of

earning capacity, $2,500.00 for future pharmaceutical expenses, $7,500.00 for future medical and hospital expenses and future voluntary assistance and services, and $18,433.60 for special damages.

The remainder of the $138,309.55 was interest. The appellant is dissatisfied with her Honour's

assessment of the component of his damages which related to future impairment of earning capacity.

The appellant, who was born on 8 July 1956, was employed by the first respondent as the

manager of its pasture improvement project in the Mitchell district on the day he was injured. He was

in good health before the incident. As a result of the collision he suffered a number of injuries including

a ruptured spleen which was later removed, fractured ribs, a contusion of the left kidney which no longer

functions, lacerations to the right knee, and a "gouge" injury to the left knee. He was taken to the Roma

Hospital where he was operated on and then he was transferred to the Royal Brisbane Hospital where

he remained for three weeks. On 8 June 1990 he was admitted to the Mitchell Hospital with a blood

clot in the left leg. He remained there for ten days. In 1992 he underwent a hernia operation and in

March 1994 an arthroscopy of the right knee. He has been left with pain in the lower back and cervical

spine, and with a twelve to fifteen per cent. incapacity of his right knee which may degenerate further

in the future. The loss of efficient function of the appellant's spine is five to seven and a half per cent.

The appellant may require further procedures on the right knee: an arthroscopy, an osteotomy, and

an arthroplasty. Her Honour found that the value at the time of judgment of the cost of those three

procedures was $5,711.00 if the arthroscopy were performed after five years, the osteotomy when the

appellant is about forty-eight years old, and the arthroplasty as he approaches his sixtieth year. She

found that there is some considerable risk of his requiring all three operations. Each would require

further time off work and further voluntary assistance and services. She explained her allowing the

$7,500.00 in this way: "[h]aving regard to the level of risk as explained by the orthopaedic surgeon Dr

Pentis, in the circumstances it is appropriate to allow a global figure for the cost of future operations and

such care in the amount of $7,500.00, which includes loss for time off work so occasioned".

The appellant did not return to work until July 1990 but was paid his usual wage and other

benefits until he did so. When he returned to work he found it tiring and his legs ached. His resumption

of full duties was gradual. He remained in the employment of the first respondent until about February

1991, when he resigned. For the five months before his resignation he performed heavy work for two

days a week and lighter duties on the remaining three days. He nonetheless felt in early 1991 that he

was having difficulty performing the work required of him and that he was not pulling his weight. Her

Honour found that in the twelve months prior to the incident the appellant earned an average wage of

$1,061.00 per month and in the twelve months after the incident an average of $1,320.00 per month,

although she also accepted that his average gross rate of pay immediately before the incident was

$410.33 per week. In addition the plaintiff and his family were provided with rent-free accommodation

in a house on the first respondent's property of Juandah Downs outside Mitchell, and with a motor

vehicle, fuel for private use, groceries, meat, electricity, and a telephone. The first respondent also paid

boarding school fees of $60.00 per week for each of two of the appellant's children.

After leaving the first respondent's employment, the appellant and his wife purchased a service

station, caravan park, and attached house for $280,000.00. The appellant believed that that work

would be easier for him than his work for the first respondent had been. The service station and

caravan park business, a partnership between the appellant and his wife, produced profits which

increased from year to year. In the year which ended on 30 June 1994 the partnership earned a taxable

profit of about $35,700.00, which included groceries and other goods consumed by the appellant and

his family to a value of about $10,200.00.

The appellant left school after grade ten. He worked in machinery workshops with heavy

machinery and motor cars, in shearing sheds, and had been a café proprietor, also in partnership with

his wife.

The appellant's income tax records for the five years ending on 30 June 1990 show that prior

to his beginning employment with the first respondent in the year ending on 30 June 1989, his earning

capacity was only modest. In the income tax return for the year ending on 30 June 1986 his occupation

was shown as sawmill hand and café proprietor and his taxable income was $9,648.00. In the following

year his occupation was shown as truck driver and café proprietor and his taxable income was

$8,570.00 (tax assessed $898.65, rebates allowed $280.00), but of that income $5,870.00 was shown

as "Unemployment/Sickness/Special benefits.." In the year ending on 30 June 1988 his occupation was

again truck driver and café proprietor and his taxable income $5,117.00 (tax assessed $4.08). The

following year his occupation was shown as mechanic and his taxable income was $9,965.00 (tax

assessed $1,167.60, Medicare levy $81.00), of which $3,120.00 was paid by the first respondent.

In the year ending on 30 June 1990 his occupation was shown as machinery manager and his taxable

income was $20,738.00 (tax assessed $3,544.82, Medicare levy $259.22).

The appellant at the time of the incident had no intention of leaving the employment of the first

respondent, but her Honour found that, as the pasture improvement project came to an end as a result

of drought and falling cattle prices soon after the appellant left the job, she was not persuaded that the

appellant would have remained in the first respondent's employ after March 1991.

Her Honour found that since leaving Juandah Downs the appellant had worked for short

periods operating machinery at the Mitchell quarry but required some assistance from other workers.

The appellant has, because of his injuries, had to refuse work of the kind that he could have undertaken

before the incident. Her Honour found that he was "unable to work for more than a couple of hours

at a stretch". He attended the driveway, mowed, and did some servicing of vehicles, but his wife did

most of the work. The appellant proposes selling the service station and acquiring another business in

which the hours will not be as long. He is able to work driving machines but would be unable to

undertake heavy lifting. Her Honour accepted that the appellant's earning capacity had been severely impaired as a result of the injuries he received in the incident. She concluded that it was appropriate

to award compensation for the future impairment of the appellant's earning capacity "on a global basis

as part of the damages for pain and suffering and loss of amenities". Her Honour did not accept an

accountant's assessment of the appellant's future loss at $192,454.00, together with $22,723.00 for loss

of superannuation benefits, calculated on the assumption that the appellant would have continued to be

employed by the first respondent until his retirement at the age of sixty years. Her Honour found that

the factual basis on which the accountant's assessment was made was in a number of important respects

not borne out by the evidence; her Honour did not accept the accountant's assessment of the value of

the fringe benefits received by the appellant while he was working for the first respondent.

The appellant was thirty-nine years old when her Honour made her assessment of $40,000.00.

If one were to allow another twenty-six years of working life to him, to retirement at sixty-five years,

her Honour's assessment is, applying the five per cent. table, the present value of a weekly loss of

$52.00 for the twenty-six years. On its face that seems a low assessment for the case of a man unable

to work more than a couple of hours at a stretch and whose earning capacity had been severely

impaired.

In testing her Honour's assessment we can conveniently begin with the appellant's gross weekly

wage of $410.33 at the time of the incident. To that sum the fringe benefits should be added and the

income tax payable deducted. As we understand her Honour's reasons she accepted that the fringe

benefits should be valued at $4,500.00, so it does not seem unreasonable to conclude that those two

adjustments would approximately cancel each other out. We must allow for the appellant's poor record

before he was employed by the first respondent, his improvement after he began that employment, and

his amply demonstrated residual earning capacity. On the latter subject, however, it must be borne in

mind that Mrs Ringelstein did most of the work. Taking all of those matters into account we consider

the $40,000.00 is plainly an under-estimate. To our minds a figure of $150.00 per week - we think it

preferable to base the assessment on a conclusion as to weekly loss rather than to attempt to arrive at

a global sum - would accurately reflect all of the relevant considerations. Applying the five per cent.

table to that sum we arrive at $115,350.00. Adjusting for contingencies, we should allow $90,000.00

for future impairment of earning capacity.

We see no scope for, and hence no merit in, the argument advanced on behalf of the

respondents that her Honour's assessment for pain and suffering and loss of amenities was so high that

any inadequacy in her assessment for future impairment of earning capacity would be offset by her over-

estimate of the former: see Elford v. FAI General Insurance Company Limited [1994] 1 Qd.

R.258. Her Honour's assessment for pain and suffering and loss of amenities was a large sum, but, it

should be remembered, the appellant has undergone a number of surgical procedures, faces the

prospect of more in the future, and is seriously disabled. We do not think then that any part of her

Honour's assessment for pain and suffering and loss of amenities should be treated as balancing the

inadequacy of her general assessment for future impairment of earning capacity, particularly as she

apparently allowed only a small sum for the appellant's probable impairment of earning capacity after

undergoing future surgery.

We should then allow the appeal and order that the judgment entered below be set aside and

that in lieu thereof judgment be entered for the appellant against the respondents for $188,309.55. We

should order that the respondents pay to the appellant his costs here and below.

COURT OF APPEAL

DAVIES JA
MACKENZIE J

HELMAN J

Appeal No 224 of 1995

DENIS RINGELSTEIN Appellant

(Plaintiff)

and

REDFORD CATTLE COMPANY PTY LIMITED First Respondent

(First Defendant)

and
HILLTERLINGS PTY LTD Second Respondent

(Second Defendant)

BRISBANE

..DATE 10/04/96

JUDGMENT

PINCUS JA: The Court here was comprised of Mr Justice Davies, Mr Justice Mackenzie and Mr

Justice Helman. The orders of the Court are appeal allowed; order that the judgment below be set

aside and that in lieu thereof judgment be entered for the appellant against the respondents for

$188,309.55; order that the respondents pay to the appellant his costs of the appeal and in the

proceedings below. I publish the joint reasons of the members of the Court.

PINCUS JA: Yes, Mr North.

MR NORTH: For the plaintiff, Your Honour, or the appellant. Your Honour, the appellant made a formal offer to settle on 18 August 1994 in the sum of $160,000 plus costs. May I hand up a copy of the offer?

PINCUS JA: To settle what? To settle?

MR NORTH: Settle the action when it was - this is well before trial.

PINCUS JA: Who is on the other side?

MS JAMES: Faline James, Deacons Graham & James, for the second defendant, Your Honour.

PINCUS JA: Do you know about this offer?

MS JAMES: Yes. That was prior to the actual trial of the hearing, Your Honour.

PINCUS JA: What should I do about it then? I am sorry, who is the-----

MR DOWN: We are for the first defendant - first respondent.

PINCUS JA: Do you know about the offer also?
MR DOWN: I have not seen the offer, Your Honour.

PINCUS JA: Who do you win against; both respondents, do you?

MR NORTH: Yes, Your Honour.

PINCUS JA: And they are separately represented.

MR NORTH: Yes. They have the same counsel, Mr Newton appeared for both defendants but instructed by separate-----

PINCUS JA: That was Mr Glen Newton, was it?

MR NORTH: No, Mr Christopher Newton.

PINCUS JA: Yes.

MR NORTH: Both the separate firms instructed him and he appeared at the appeal for both of the respondents.

PINCUS JA: Yes. Well, what should I do about the offer? Can you tell me?

MS JAMES: Well, Your Honour, as much as it irks me I do not think there is anything we can do-----

PINCUS JA: Do you want time to think about it or would you like a few minutes to discuss it? I could come back shortly.

MS JAMES: That - if you could, Your Honour, that would be appreciated.

MR DOWN: That would be acceptable, Your Honour.

PINCUS JA: Very well. Does that suit you, Mr North?

MR NORTH: I have no other pressing engagement, Your Honour.

PINCUS JA: All right. We will adjourn and would you let me know when you are ready please?

MS JAMES: Certainly, Your Honour, thank you.

THE COURT ADJOURNED AT 9.42 A.M.
THE COURT RESUMED AT 9.46 A.M.

MR NORTH: Your Honour, I understand that the respondents do not oppose in a sense that they cannot submit - do not submit to the contrary that the orders in respect of costs of the trial and of the appeal ought to be that the plaintiff's costs be taxed on a solicitor and client basis.

PINCUS JA: From what point?

MR NORTH: Your Honour, under the Rules of Court if a plaintiff delivers an offer then the plaintiff is entitled to - unless exceptional circumstances are shown - costs of the action.

PINCUS JA: The whole costs?

MR NORTH: Mmm.

PINCUS JA: I see.

MR NORTH: Whereas the defendant only gets the costs from the time of making an offer, if-----

PINCUS JA: That seems very fair.

MR NORTH: Well, the plaintiff is always entitled to the plaintiff's money.

PINCUS JA: Yes.

MR NORTH: I was told that was the rationale for the granting of the rule.

PINCUS JA: Anyway, I gather there is no opposition to an order that the costs mentioned in the

Court's order be taxed on a solicitor and client basis, that is all you need, is it?

MR NORTH: Yes, Your Honour.

PINCUS JA: Is that so?

MS JAMES: Yes, Your Honour.

MR DOWN: Yes, Your Honour.

PINCUS JA: I will further order that the costs mentioned in the Court's order be taxed on a solicitor

and client basis.
MR NORTH: Would Your Honour publish your reasons?

PINCUS JA: I publish the reasons.

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