ROADS and Traffic Authority v Jelfs

[1999] NSWCA 179

Reported Decision: (2000) Aust Torts Reports 81-583

New South Wales

Court of Appeal

CITATION:	ROADS & TRAFFIC AUTHORITY v JELFS [1999] NSWCA 179
FILE NUMBER(S):	CA 40642/96
HEARING DATE(S):	13 November 1998
JUDGMENT DATE:	11 June 1999
PARTIES :	ROADS & TRAFFIC AUTHORITY OF NEW SOUTH WALES v DENNIS JELFS
JUDGMENT OF:	Mason P at 1; Handley JA at 60; Giles JA at 88

LOWER COURT JURISDICTION:	Supreme Court - Common Law Division
LOWER COURT FILE NUMBER(S) :	NR 600053/95
LOWER COURT JUDICIAL OFFICER:	Levine J

COUNSEL:	C T Barry QC/ P R Sternberg (Appellant) D A Wheelahan QC/ M Snedden (Respondent)
SOLICITORS:	Ian Victor Knight (Crown Solicitor) (Appellant) John McDonald & Partners - Murwillumbah (Respondent)
CATCHWORDS:	DAMAGES - Compensation to Relatives Act 1897 - Dependants’ action - Award of damages for past and future care - Law Reform (Marital Consortium) Act 1984 - Construction of this Act - Application of Griffiths v Kerkemeyer principle - Apportionment of damages award; DAMAGES - Amount of general damages for nervous shock - Future loss of earning capacity
ACTS CITED:	Compensation to Relatives Act 1897 Law Reform (Marital Consortium) Act 1984
DECISION:	Appeal dismissed with costs

THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40642/96

MASON P
HANDLEY JA
GILES JA

11 June 1999

ROADS & TRAFFIC AUTHORITY OF NEW SOUTH WALES
v Dennis JELFS

DAMAGES - Compensation to Relatives Act 1897 - Dependants’ action - Award of damages for past and future care - Law Reform (Marital Consortium) Act 1984 - Construction of this Act - Application of Griffiths v Kerkemeyer principle - Apportionment of damages award

DAMAGES - Amount of general damages for nervous shock - Future loss of earning capacity

The respondent’s wife died on 12 September 1989 as the result of a pulmonary embolism following a fall at the appellant’s premises. It was common ground that the death was caused by the fall, and that the fall was the consequence of the appellant’s negligence.

Two proceedings were heard together before Levine J. One was a dependants’ claim pursuant to the Compensation to Relatives Act 1897 and in relation to this the respondent was awarded a verdict of $527,475 (part of this sum being apportioned amongst two young adult children of the respondent and the deceased). The other proceeding was a claim for damages for nervous shock and in relation to this the respondent was awarded a verdict of $476,973.

The defendant appealed, pressing five main grounds.

HELD by Mason P (Handley and Giles JJA concurring), dismissing the appeal:

1. In relation to the submission that s3(1) of the Law Reform (Marital Consortium) Act 1984 precludes the Court from including any sum in respect of “services” as a component of a widower’s damages in proceedings under the Compensation to Relatives Act:
· This proposition was not taken at trial, which precludes this point being taken on appeal.

Coulton v Holcombe (1986) 162 CLR 1; Multicon Engineering Pty Ltd v Federal Airports Corporation (Court of Appeal, unreported, 25 October 1997) (applied)

· The submission is without merit and is contradicted on a proper understanding of the Law Reform (Marital Consortium) Act 1984. Discussion of the nature and history of the action for loss of consortium.
Nguyen v Nguyen (1990) 169 CLR 245 (applied)

2. In relation to the allegedly incorrect application of the Griffiths v Kerkemeyer principle:
· There was no misapplication of the principle by the trial judge.
· A husband is one of the relatives protected by the Compensation to Relatives Act and his loss is compensable as part of the single award. Loss of a wife’s domestic services maybe a material cost, even if they are not replaced at pecuniary cost.

Griffiths v Kerkemeyer (1977) 139 CLR 161; Nguyen v Nguyen (1990) 169 CLR 245 (discussed)

3. In relation to the alternative submission that the sum awarded in the dependants’ action with respect to past and future care of the respondent was excessive:
· The decision of the trial judge was entirely reasonable on the evidence in this case.

4. In relation to the challenge to the award of general damages for nervous shock:
· The award of $80,000 for general damages was justified. There was sufficient evidence to support the finding that the respondent suffered a clinically assessed psychiatric illness which constituted something more than “natural grief”.

5. In relation to the challenge to the award of damages for loss of future earning capacity:
· The findings of severe and depressive illness were appropriate in the light of lay and specialist evidence. The trial judge was justified in relying on this evidence to support his conclusion that there was no real likelihood of a return to gainful employment.

Apportionment in the dependants’ action discussed.

By Handley JA (Mason P and Giles JA not deciding):
· The trial judge erred in his apportionment of the award for past care. While the respondent’s daughter replaced her mother as the care provider and gave up a full time job to do so, she was apportioned only $8,724 out of a total award under this head of $185,803. While there was no appeal against the award by the daughter, justice and principle require that the Court refuse to support the apportionment.

Compensation to Relatives Act ss4(1), 6B(1) and (2), Davies v Powell Duffryn Associated Collieries Ltd [1942] AC 601, Nguyen v Nguyen (1990) 169 CLR 245, Griffiths v Kerkemeyer (1977) 139 CLR 161, McIntosh v Williams [1976] 2 NSWLR 237, Pym v The Great Northern Railway Co (1836) 4 B&S 397, 407 (122 ER 508, 512), Mehmet v Perry [1977] 2 All ER 529, Cresswell v Eton [1991] 1 WLR 1113 (discussed)

· There had been a prima facie breach of duty by the respondent towards his daughter Dana from which he will derive a substantial financial benefit which this Court should not ignore.

Erwin v Shannon’s Brick, Tile & Pottery Co Ltd (1938) 38 SR (NSW) 555, McIntosh v Williams [1976] 2 NSWLR 237, Gullifer v Pohto [1978] 2 NSWLR 353 (discussed)

ORDERS:

(1) Appeal dismissed with costs.
(2) Order that the appellant pay into Court within 21 days the sum of $185,803 out of the judgment for $527,475 awarded for the cause of action under the Compensation to Relatives Act being the award for past loss of care together with post judgment interest accrued on that amount to the date of payment in.
(3) Pursuant to its powers under SCR Pt 51 r 22(1) the question of the proper apportionment of the monies ordered to be paid into Court between the respondent, Dennis Jelfs, and the other persons, Peter Jelfs and Dana Jelfs, for whose benefit the action was brought, is adjourned for a directions hearing before the President at 9.30 am on Friday 25 June.
(4) The respondent Dennis Jelfs is within 7 days to serve on Peter Jelfs and Dana Jelfs copies of the Court’s reasons for judgment including the orders therein and a letter from his solicitors informing them that the proceedings will be before the Court on the date referred to so that the Court can consider any application for a variation of the apportionment of the sum of $185,803 plus interest in Court representing the award for past loss of care before the monies are paid out of Court to the persons entitled and that the costs of those persons, reasonably incurred, are likely to be ordered to be paid out of the funds in Court.

THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40642/96
NR 600053/95

MASON P
HANDLEY JA
GILES JA

11 June 1999

ROADS & TRAFFIC AUTHORITY OF NEW SOUTH WALES
v Dennis JELFS

JUDGMENT

1 MASON P: The respondent’s wife (the deceased) died on 12 September 1989 as the result of a pulmonary embolism following a fall at the appellant’s premises ten days earlier in which she suffered a broken ankle. It was common ground that the death was caused by the fall, and that the fall was the consequence of the appellant’s negligence. 2 Two proceedings were heard together before Levine J. One was a claim pursuant to the Compensation to Relatives Act 1897 (“the dependants’ action”). It was brought by the respondent on behalf of himself and the two children of the marriage, Dana born in 1972, and Peter born in 1973. The deceased was born in 1942 and married the respondent in 1969. She was two years older than him. 3 The other proceeding (“the nervous shock action”) was brought by the respondent in his own right, claiming damages for nervous shock. It was established that he suffered a depressive illness in consequence of the circumstances of his wife’s death. That finding is no longer in dispute. 4 In the dependants’ action there was a verdict for the plaintiff in the sum of $527,475 made up as follows:

1. Out of pocket expenses 4,079
2. Past care (Plaintiff) 104,300
3. Past care (Dana) 8,724
4. Past care (Peter) 72,779
5. Future care (Plaintiff) 337,593

5    In the nervous shock action there was a verdict for the plaintiff in the sum of $476,973 made up as follows:

1. General damages 100,000
2. Interest for 7 years at 2% on $50,000 7,000
3. Future medical expenses 5,000
4. Past economic loss (including interest) 179,685
5. Future economic loss 185,288

6    The defendant was ordered to pay the plaintiff’s costs in each action. The judgments took effect on 2 October 1996. The defendant appeals.

Grounds of appeal

7    The grounds of appeal that were pressed are as follows:

Dependants’ action

1. The award of damages for “past and future care” of the respondent was contrary to the Law Reform (Marital Consortium) Act 1984 .
2. Alternatively, the award was assessed erroneously because it was based on the principle relating to compensation for gratuitous care in a personal injuries action ( Griffiths v Kerkemeyer principle).
3. Alternatively, the award was excessive.

Nervous shock action

4. The general damages were excessive.
5. The judge erred in assessing damages for future loss of earning capacity without allowing for the actual or possible residual earning capacity of the respondent.

1. Failure to apply the Law Reform (Marital Consortium) Act 1984

8 Section 3(1) of the Law Reform (Marital Consortium) Act 1984 (“the Consortium Act”) provides:

A person is not liable for damages in tort on the ground that the negligence, or other act or omission, of the person caused loss or impairment of the consortium of a husband and wife.

9 The appellant accepts that a claim under the Compensation to Relatives Act (which is statutory) is not an action for loss of consortium (which was a claim at common law). However, the submission is that s3(1) of the Consortium Act went beyond abolishing this common law right of a husband. It is contended that it also precludes the Court from including any sum in respect of “services” as a component of a widower’s damages in proceedings under the Compensation to Relatives Act. 10 The proposition appears not to have been advanced in any earlier case. Nor was the point taken at trial. This in itself is said by the respondent to preclude the point being taken on appeal. Applying the principles stated in Coulton v Holcombe (1986) 162 CLR 1 and Multicon Engineering Pty Ltd v Federal Airports Corporation (Court of Appeal, unreported, 25 October 1997) I would uphold the respondent’s objection on this procedural ground. It is not suggested that the evidence might possibly have been different had the point been taken below. But had the appellant submitted at trial that the loss suffered by the respondent in consequence of the death of his wife was not compensable in the dependants’ action in consequence of the Consortium Act, then it would have been possible to recast the claim. The psychiatric injuries suffered by the respondent were of a nature that they could have led to an award of Griffiths v Kerkemeyer type damages in the nervous shock case. The two actions were heard together. 11 The submission should also be rejected because it is without merit. It is contradicted by the proper construction of the Consortium Act. And it evaporates in the sunshine of a proper understanding of the respective bases of the common law action for loss of consortium and the statutory cause of action under the Compensation to Relatives Act. 12 A husband’s action for loss of his wife’s services (loss of consortium) derived from the same stream of principle as a master’s action for loss of an employee’s services (loss of servitium). The action was also a relic of the proprietary rights that a husband was once thought to possess in his wife. The nature and history of the action for loss of consortium, its anomalies and deficiencies, are well documented (see Peter Brett, “Consortium and Servitium” (1955) 29 ALJ 321, 389; Australian Law Reform Commission, Community Law Reform for the Australian Capital Territory: Second Report, Report No 32). 13    The possibility that loss of consortium could be reciprocal first arose in Lynch v Knight (1861) 9 HLC 577, 11 ER 854. Lord Campbell died before judgment was given, but his speech was read by Lord Brougham. Lord Campbell was inclined to recognise a similar right in the wife in view of the social changes in the status of married women that were emerging. But he was in the minority, and the House of Lords for various reasons rejected the idea of a wife’s right to sue for this kind of loss. The remarks in Lynch were obiter. Early twentieth century cases show bold judges being prepared to recognise a correlative right of a wife (Gray v Gee (1923) 39 TLR 429, Johnson v Commonwealth (1927) 27 SR(NSW) 133). But the wife’s right to damages for loss of consortium was rejected by the High Court in Wright v Cedzich (1930) 43 CLR 493 over the passionate and learned dissent of Isaacs J. See also Best v Samuel Fox Ltd [1952] AC 716. 14 The long title of the Consortium Act is “An Act to abolish actions for damages for loss of consortium”. Section 3 provides:

Abolition of action for loss or deprivation of consortium
3.(1) A person is not liable for damages in tort on the ground that the negligence, or other act or omission, of the person caused loss or impairment of the consortium of a husband and wife.
(2) Nothing in subsection (1) applies to causes of action accrued before the commencement of this section.

15 The mischief identified in the Minister’s second reading speech (New South Wales Parliamentary Debates, 29 February 1984, Assembly, pp4871-2) was the archaic, discriminatory and patriarchal nature of the husband’s action for loss of consortium. Nothing suggests the slightest intention to effect what would be a partial and discriminatory repeal of the Compensation to Relatives Act 1897. 16 The essential fallacy in the appellant’s reasoning is that it ignores the fact that the Consortium Act addressed a single issue, the husband’s common law action for consortium. That, and that alone, was abolished. Neither the mischief identified by the Minister, nor the language of the statute went further. The use of the technical term “consortium” in s3 confirms the limited scope of the reform. The action for loss of or impairment to consortium was a single cause of action, unavailable in relation to the death of the wife, which compendiously recompensed the husband for loss of a congeries of rights or benefits. See Best at 735; Toohey v Hollier (1955) 92 CLR 618; Harris v Grigg [1988] 1 Qd R 514 at 517. The Act does not purport to interfere with other rights of husbands, even if they involve compensation for lost “services”. Thus, a husband may still enforce a binding contract under which his wife agreed to perform certain services. Similarly, it cannot be read as effecting a partial repeal of the Compensation to Relatives Act. 17 The position is equally clear when looked at from the perspective of the Compensation to Relatives Act. A husband’s statutory right to recover damages flowing from the death of his wife cannot be equated with the action for loss of consortium. The infamous case of Baker v Bolton (1808) 1 Camp 493, 170 ER 1033 established, in Lord Ellenborough CJ’s words, that “in a civil Court, the death of a human being could not be complained of as an injury”. Of present interest is the fact that Baker v Bolton was a husband’s action for damages for loss of consortium. Baker established that such damages do not lie where the tort kills the wife rather than simply maims her. (The House of Lords affirmed this proposition in Admiralty Commissioners v SS Amerika [1917] AC 38.) No reason was given by Lord Ellenborough for his ruling and it has frequently been said to have been wrong. Nevertheless it became accepted law (see Woolworths Ltd v Crotty (1942) 66 CLR 603). When John Campbell, the reporter of Baker v Bolton, became Lord Campbell, he procured its partial overturning by the Fatal Accidents Act 1846 (UK) which commonly bears his name. The cause of action which the Act created was conferred, in the first instance, upon the legal personal representative as fiduciary for all the dependants whose interests had been infringed. It was a cause of action which was “new in its species, new in its quality, new in its principle, in every way new” (The “Vera Cruz” (1884) 10 App Cas 59 at 70-71 per Lord Blackburn). It does not build upon some common law right of any particular relative. 18 The Act has been read down to allow only recovery for loss of economic or material advantages to the survivors. The consequence is that:

Damages in the nature of solatium for grief or bereavement (unless amounting to psychiatric illness), for loss of consortium or allowance for the gravity of the injury preceding death are rigorously excluded. Dependants are protected in their interests of substance, not of personality. (Fleming, The Law of Torts , 9th ed, 1998, pp 734-5.)

19 It can therefore be seen that the Consortium Act addresses an entirely different universe of discourse from the Compensation to Relatives Act. This proposition is demonstrated with customary clarity and force by Deane J in Nguyenv Nguyen (1990) 169 CLR 245 at 251.

2. Incorrect application of the Griffiths v Kerkemeyer principle

20    The damages award in the dependants’ action included amounts with respect to the “past care” of each of the respondent ($104,300), his daughter ($8,724) and his son ($72,779). The factual basis - which will be elaborated below - was that the deceased had worked hand and foot for her family as a care giver, home maker and (in the case of the respondent) business partner. The loss of such domestic “services” in consequence of the death of the deceased is a material loss that may sound in damages under the Compensation to Relatives Act (Nguyen). 21 The proposition involved in this part of the appellant’s challenge to the verdict in the Compensation to Relatives Act claim is based on the following passage in the judgment:

I note the submissions made in relation to the Compensation to Relatives cause of action in the light of what fell from Dixon J in Public Trustee v Zoanetti (1945) 70 CLR 266 at 276 to 277 and the considerations in relation to the loss of gratuitous domestic services in Nguyen v Nguyen (1990) [169 CLR 245] per Brennan J at [247-248] and Deane J at [256-257] and the majority at [263-265] .

I accept the submission on behalf of the plaintiff that the matters of principle and reasons therefor in Nguyen are very much akin to Griffiths v Kerkemeyer (1977) 139 CLR 161 and that in this case there is justification for an entitlement for compensation for the gratuitous services that would have been provided by Mrs Jelfs up until Peter’s eighteenth birthday and that the plaintiff is entitled to the same services provided since that time until the date of his death: (see also Van Gervan v Fenton (1992) 175 CLR 327).

22 It is submitted that this passage indicates that the trial judge misunderstood the basis upon which damages are awarded under the Compensation to Relatives Act. In particular it is submitted that the trial judge erred in suggesting that a husband would suffer material loss in consequence of the death of his wife. To have done so, is said to have involved equating a wife to an indentured domestic servant. 23 I disagree. A husband is one of the relatives protected by the Act. There is no reason in principle why a husband may not, on an assessment in financial terms, be the dependant of his wife. If her death causes loss, when all relevant matters are brought to account, then the husband’s loss is compensable as part of the single award. 24 As can be seen from the passages in Nguyen referred to by his Honour, the point he was making was that Nguyen deals with a principle “akin” to the principle in Griffiths v Kerkemeyer in the sense that the dependant’s loss may be valued by reference to the commercial cost of replacing that which was lost (provided it is compensable under the Act). In respect of the death of a wife and mother, damages can be claimed for loss, not only of outside earnings which she contributed to the family purse, but also of her domestic services in looking after the home. Nguyen also establishes that compensation may be recovered in a claim under Lord Campbell’s Act for lost domestic services which are not replaced at pecuniary cost. It was held that a loss of domestic services may be a material cost, even if not replaced at pecuniary cost: at 247 per Brennan J, 255-6 per Deane J, 260-1 per Dawson, Toohey and McHugh JJ. In emphasising this point, the justices drew an analogy with damages awarded pursuant to Griffiths v Kerkemeyer (at 248-250 per Brennan J, 255-6 per Deane J, 264 per Dawson, Toohey and McHugh JJ) at the same time as they emphasised that Griffiths v Kerkemeyer, being a common law action for damages, is quite distinct from a claim under Lord Campbell’s Act (esp at 262). In Swan v Williams (Demolition) Pty Limited (1987) 9 NSWLR 172 at 186, the cost of replacement services was used to calculate this component of the award. 25 Nothing indicates that these principles were misapplied by the learned trial judge.

3. Excessive award with respect to respondent’s loss in dependants’ action

26    Alternatively, it was submitted that the sum awarded in the dependants’ action with respect to the past and future care of the respondent was excessive. It was submitted that the amount awarded did not reflect the extent to which the deceased’s services were provided for her husband, as distinct from the children in the family. 27    In Swan (at 186) Samuels JA emphasized that:

Where the claim is made by a widower it must be kept clearly in mind that his loss of pecuniary benefit in the ordinary case of a wife who was mainly a housekeeper is constituted by the value of the services of which he has been deprived by her death. It is not a question of estimating the loss of money which during the spouse’s lifetime was contributed to the household but of estimating the value of the services which are no longer provided.

28    Any loss has to be adjusted to take account of the fact that the surviving spouse was relieved of the burden of rendering gratuitous services for the deceased (Nguyen at 256-7). 29 The trial judge accepted the respondent’s evidence as to the domestic assistance given to him during her lifetime by his wife in relation to himself and the children. Not only did she perform the secretarial tasks related to various family businesses but she was also a dedicated provider in the home in terms of all domestic activities. This was a family where, it was held, the children did not provide any assistance at all. Levine J calculated the respondent’s loss of past and future domestic services at the rate of 20 hours per week based on 4 hours per day for 5 days a week or 3 hours per day for 7 days a week, but agreed at 20 hours per week (the reference in the judgment to “per day” is an obvious mistake). The respondent’s evidence was that he spent 3-4 hours a day, on most days, doing those things that his late wife had previously done for him (AB 144. See also AB 99-101, 115-117.) In the light of this evidence from a witness who was accepted as entirely credible by the trial judge it seems impossible to fault the conclusion that 20 hours per week was reasonable estimate. Indeed, it would appear that it was an agreed calculation (AB 400). 30    Applying these findings to an hourly sum for the cost of replacement domestic services and projecting the loss for the period of the respondent’s life expectancy (discounted at 3%) produced the figures of $104,300 for past care and $337,593 for future care in respect of the respondent. 31    The appellant’s real complaint is that his Honour made no allowance for the possibilities that, even uninjured, Mrs Jelfs may have become ill or died, and that there may have been periods when she could not provide the domestic services to which her husband had long become accustomed. It was also suggested that some discount might have reflected the possibility, albeit very small in the present case, that the marriage may not have survived, but this seems entirely speculative and contrary to the evidence. The appellant also submitted that the calculations did not reflect the vicissitude that that respondent himself may have become ill and required treatment elsewhere than at home. (The vicissitude of death was definitely taken into account because the life tables were used in relation to the respondent.) 32    It is certainly possible, as the appellant argues, that Mrs Jelfs may not have been capable of continuing for the rest of her life spending 20 hours per week in caring for her husband. (The evidence revealed that she did all the cooking, cleaning and washing. She did the gardening and mowed the lawns most of the time.) However, it is not self-evident that a wife would spend less time looking after her husband as they both grew older. While her capacities would undoubtedly diminish with time, so too would his. Lifelong experiences of sacrificial service by one partner for another are unlikely to be jettisoned except under very pressing supervening incapacity. It is also possible that the hours spent by a wife looking after her husband could increase rather than diminish over time. I see no error in the decision to treat 20 hours per week as a constant in the circumstances of this particular marriage.

4. General damages in nervous shock action

33    In the nervous shock action the primary judge awarded $100,000 general damages for what he summarised as a claim:

… of the utmost severity in terms of all the factors that have impacted upon [the respondents’] life as a human personality consequent upon the death of his wife….

34 The award is challenged as being beyond the range of a sound discretionary assessment. However, a particular argument was also addressed in the written and oral submissions. It was submitted that the trial judge erred in including a component of damages for grief as distinct from depressive illness. 35 It was not in issue that the respondent suffered a psychiatric injury which would entitle him to damages for so-called nervous shock. The appellant accepts that Mr Jelfs suffered a depressive illness of some magnitude, justifying an award of $80,000 general damages. 36 The existing law relating to damages for nervous shock, including damages recoverable pursuant to the Law Reform (Miscellaneous Provisions) Act 1944, requires the Court not to compensate for so-called ordinary grief and anguish as well as anxiety about the welfare of the deceased (see generally Macpherson v The Commissioner for Government Transport (1959) 76 WN(NSW) 352; Swan v Williams (Demolition) Pty Limited (1987) 9 NSWLR 172; De Francheschi v Storrier (1988) 90 FLR 95; Pham v Lawson (1997) 25 MVR 343). 37 In my view the judgment betrays no error in this regard. The reasoning indicates that his Honour was aware of the distinction drawn in the cases to which I have just referred. The respondent’s reaction to his wife’s unexpected death was extreme and catastrophic. What is more it was clinically assessed as a psychiatric illness. 38 The facts found by the trial judge may be summarised as follows. Prior to his wife’s death the respondent was a friendly and easy going person, without any difficulty in relating to other people. He was neither shy nor retiring. The unexpected loss of his wife on 12 September 1989 produced prolonged crying bouts, nightly dreaming about the circumstances of her death, and sleep problems. Between September 1989 and January 1990 there were daily visits to the grave, sometimes up to three hours in duration. The respondent lost virtually complete interest in any personal or business matters. 39 The respondent first sought medical attention with regard to his emotional state in about 1993. He was recommended to a psychiatrist, but failed to attend because he did not believe that any help would be forthcoming. Ultimately he consulted a psychiatrist in 1995. He was placed on medication, but this only seemed to make him cranky and aggressive. He developed a fear of a semi-trailer coming through the side of his house. 40 The respondent moved from Murwillumbah to Innisfail in January 1990. Since living there he has avoided people, except for the occasional drinking companion at the local hotel where he spends much of his time. There have been suicidal thoughts coupled with a feeling of responsibility for his wife’s death. 41 Although the respondent was challenged about his symptoms, for which he had not sought psychiatric treatment on any ongoing basis, his evidence of depressive illness was accepted by the trial judge. It was corroborated by the respondent’s daughter Dana. More significantly, it was supported by the evidence of three psychiatrists. Dr Danesi diagnosed grief complicated by a major depressive episode of moderate severity not associated with psychotic features or a bi-polar disorder, as well as alcohol abuse. The doctor formed the view that it seemed likely that the respondent would be left with some ongoing sequelae of his depressive illness. These symptoms would include the possible continuation of loss of self esteem and confidence, indecisiveness, lack of motivation and interest, as well continuing lethargy and poor concentration. 42 Dr Mullholland opined that the respondent had suffered a depressive illness in respect of which the death of his wife was a precipitating factor. He observed that it was typical of the condition that the respondent had not sought proper treatment. 43 Dr Knoffling diagnosed an adjustment disorder with depressive mood which, from the history, had developed into dysphemia. That condition was of mild to moderate severity. 44 Based on this material, the learned trial judge rejected the submissions of the defendant that the plaintiff had suffered no more than “natural grief” or “a normal grief reaction”. When recounting something put to the respondent’s daughter in cross examination, his Honour observed:

That which befell the plaintiff was catastrophic in terms of the domestic support and the business support from his wife and the virtual destruction of him as an individual personality conformably with the medical opinion. To describe any component of his case flowing from his wife’s death as a “hiccup” is unwarranted on the evidence.

45    The reference to destruction of the respondent as an individual personality was taken up when the general damages were assessed, and it is evident that his Honour had in mind the factors which underlay the medical opinions of psychiatric illness. In my view his Honour did not compensate for grief as distinct from psychiatric illness, and there was no error in this approach to this aspect of the claim. Nor can it be said that the sum awarded was beyond an appropriate sum having regard to the intensity and duration of the psychiatric illness and its attendant sequelae.

5. Damages for loss of future earning capacity

46    The trial judge awarded $185,288 in the nervous shock action for future loss of earning capacity. He indicated that he was satisfied that the respondent, but for the death of his wife, would have continued to work in his taxi truck and pest control businesses (conducted in partnership with his wife until her death) until aged 65. His Honour accepted submissions based upon a report of Ernst and Young that this involved an annual loss of $20,127 net per year. This was discounted at 3% and an allowance was made at the rate of 15% for vicissitudes to produce $185,288. 47    The appellant does not challenge the raw figures. Rather it is submitted that the medical evidence did not support a finding that the respondent had no residual earning capacity. It was also submitted that an allowance of greater than 15% for vicissitudes was appropriate in the light of the respondent’s sporadic work history prior to his wife’s death. The submission was that a reduction of 35% would appropriately have given effect to these two factors. 48    In challenging the finding of no residual earning capacity, the appellant relies upon material contained in the reports of Drs Danesi and Mullholland. Dr Danesi is a consultant psychiatrist who reported (AB 189) that 20% of people with grief and depressive symptoms similar to the respondent do not make a full recovery after a major depressive episode. In view of the length of the respondent’s present episode of depression, it seemed likely to Dr Danesi that the respondent would be left with some ongoing sequelae of his depressive illness. He continued:

These symptoms would include the possible continuation of loss of self-esteem and confidence, indecisiveness, lack of motivation and interest as well as continuing lethargy and poor concentration. All these factors would make it difficult to re-establish himself in the work force and perform as he had done previously. This may set him up for further episodes of failure and hence further episodes of depression.

He has used alcohol as a way of controlling his distressing feelings. People with grief and depression are at increased risk of alcohol abuse and dependency. If it is not successfully managed in terms of regaining control of his alcohol use through sobriety or minimal intake, it would be another major impediment to return to the work force or establishment of any further close, intimate relationships.

49    Dr Mullholland expressed the view that:

This man has now been seriously depressed for over five years and even if he was to recover in the next few months there is going to be a significant risk of relapse. It is likely that within the next five years he would have at least a 50% chance of relapse even if he recovers from this episode. (AB 196)

50    In the light of these rather gloomy prognoses and the evidence about the respondent’s existing condition, being one that has lasted since his wife’s death with little abatement, I see no error in the trial judge’s conclusion that there was no real likelihood of a return to gainful employment. It is not to be overlooked that the respondent was aged 52 at the date of trial. The prospects of a man of that age who is severely damaged, psychiatrically speaking, re-entering the work force in a country town can hardly be said to be significant in today’s market. Some of the appellant’s attack upon this component of the award effectively sought to challenge the findings of severe and depressive illness. In my view those findings were clearly appropriate in the light of the lay and specialist evidence.

Apportionment in the dependants’ action

51    During argument in the appeal concern was expressed about the way in which the award in the dependants’ action was apportioned as between the respondent and his daughter Dana with respect to past care. The judgment indicates that the award of $8724 in favour of Dana was the sum sought by the respondent, who was the sole plaintiff at trial. 52    The trial judge made separate calculations with respect to the past care components of the award in the dependants’ action. These were then aggregated with other components to make up the requisite single award. By implication the apportionment of the award is in accordance with the identified components. 53    When Mrs Jelfs died on 12 September 1989, Peter (born 19 November 1973 - then aged almost 16) was still at school and Dana (born 27 February 1972 - then aged 17) was employed at the Department of Social Security. Dana took leave without pay from the beginning of 1990 and while on leave resigned her position on 6 March 1990. Because of the respondent’s condition and the age of her brother, Dana virtually took over where her late mother had left off. She did the cooking, cleaning, washing, shopping and driving for the family. She spent 20-30 hours per week in these activities. She moved to Innisfail when the family moved, although (after a period) she moved into separate accommodation there. But she continued to do virtually all the work until about mid 1992. 54    Sometimes it is appropriate to treat the death of one parent as shifting to the survivor the role of maintaining the children. In those circumstances the children suffer no loss in consequence of their parent’s death and this is reflected in the apportionment exercise (see Luntz, Assessment of Damages for Personal Injury or Death 3rd ed, 1990, [9.4.5]). But this is not an invariable rule. There can be cases where the surviving parent might squander the damages awarded and not provide for the children as well as the deceased had done (ibid). 55    Here the Court knows the facts, and so there is no need to speculate about them. Those facts show that Dana’s loss in consequence of the death of her mother was real and substantial. Her father certainly did not take on the deceased’s role. It is conventional and appropriate in the case of a young adult who has gone to work to treat his or her dependence upon the deceased as ceasing at age 18 and this seems to have been the basis for the slight award to Dana for part care ($8724). 56    Since, however, that was the sum claimed by the respondent there is a sense of unease that the rights of Dana may not have been given their proper due. 57    The appeal should be dismissed with costs. 58    I have had the benefit of reading the judgment of Handley JA. Since the issue of the daughter’s entitlement has not been fully argued at this stage of the proceedings I would prefer to reserve my position on the issue. 59    I concur with the additional orders proposed by Handley JA in the dependants’ action. They will allow the appeal to be disposed of, and they will ensure that the apportionment issue can come back to the Court if the family members are unable to reach agreement. 60    HANDLEY JA: In this appeal I have had the benefit of reading the judgment of Mason P. I agree with his Honour’s reasons and conclusions but I am not able to acquiesce in the apportionment of the judgment for $527,475 in the action under the Compensation to Relatives Act (the Act). The plaintiff in that action was the widower, but it was brought not only for his benefit but also for the benefit of the two children of the marriage, Peter, who was almost 16 at the date of death, and Dana who was then 17. 61    Section 4 (1), so far as relevant, enables such an action to be brought:

“… for the benefit of the … husband … and child of the person whose death has been so caused and shall be brought by and in the name of the executor or administrator of the person deceased, and in every such action the jury may give such damages as they may think proportioned to the injury resulting from such death to the parties respectively for whom and for whose benefit such action is brought, and the amount so recovered ... shall be divided amongst the before-mentioned parties in such shares as the jury by their verdict find and direct”.

62 The present action was not brought by the widower pursuant to s 4 but pursuant to s6B(1) which provides where there is no executor or administrator, or where such person does not bring an action under the Act, “the person or any one or more of the persons for whose benefit the action might be brought by such an executor or administrator may bring the action”. Sub s (2) provides:

“Any action so brought shall be for the benefit of the same person or persons and shall be subject to the same provisions and procedure, as nearly as may be, as if it were brought by such an executor or administrator”.

63    The effect of these provisions was considered by Lord Wright in Davies v Powell Duffryn Associated Collieries Ltd [1942] AC 601 who said, 611-2:

“The general nature of the remedy under the Fatal Accidents Act has often been explained … the claim is, in the words of Bowen LJ in The Vera Cruz [No 2] (1884) 9 PD 96, 101: for injuriously affecting the family of the deceased. … The damages are to be based on the reasonable expectation of pecuniary benefit or benefit reducible to money value. … The actual pecuniary loss of each individual entitled to sue can only be ascertained by balancing, on the one hand, the loss to him of the future pecuniary benefit, and, on the other, any pecuniary advantage which from whatever source comes to him by reason of the death”.
See also Nguyen v Nguyen (1990) 169 CLR 245.

64    I am concerned at the apportionment which awarded $8,724 to Dana, said to be the amount claimed, and $72,900 for Peter, inclusive of interest in each case, for loss of past care, and $104,300 to the widower for past care out of the total verdict of $527,475. 65    The facts in relation to the daughter’s loss, as stated by Mason P, were that following the death of the mother on 12 September 1989 Dana, who was then employed at the Department of Social Security:

“… took leave without pay from the beginning of 1990 and while on leave resigned her position on 6 March 1990. Because of the respondent’s condition and the age of her brother Dana virtually took over where her late mother had left off. She did the cooking, cleaning, washing, shopping and driving for the family. She spent 20-30 hours per week in these activities. She moved to Innisfail when the family moved, although [after a period] she moved into separate accommodation there. But she continued to do virtually all the work until about mid 1992”.

66    As the President states:

“These facts show that Dana’s loss in consequence of the death of her mother was real and substantial. Her father certainly did not take on the deceased’s role. However it is conventional and appropriate in a case of a young adult who has gone to work to treat his or her dependence upon the deceased as ceasing at age 18. This seems to have been the basis of the slight award to Dana for past care … Indeed the judgment indicates that it was the sum claimed [presumably by the respondent, who was the plaintiff in the dependants’ action]”.

67    I am unable to acquiesce in an apportionment for Dana of $8,724 for loss of past care out of a total award under this head of $185,803 when:

(1) She replaced her mother as the care provider for this family on a part time basis until the beginning of 1990 and then on a full time basis until mid 1992;
(2) She gave up a full time job with the Department of Social Security to do so, and lost the earnings and the economic and social benefits of full time employment during this period, and the springboard that would have provided for promotion or a transfer to a better job;
(3) The damages for lost services she replaced with her labour and at the cost of her personal earnings have been awarded to her father and brother who received the benefit of the care she provided.

68    A result so unjust, anomalous and discriminatory should only be accepted by the Court if it is mandated by directly binding authority or intractable statutory language but this is not the case. The Court cannot make final orders to give effect to my prima facie view because the daughter and the son were not separately represented and the Court has not heard full argument on the question which does not concern the appellant. 69    An injured plaintiff who recovers an award for past gratuitous services under the principles in Griffiths v Kerkemeyer (1977) 139 CLR 161, provided by members of his or her family, does not hold that award in trust for the persons providing those services. See Kars v Kars (1996) 187 CLR 354. However in my respectful opinion this does not support the apportionment of the award for loss of past care made in this case. The critical distinction is that under the Act each dependant is a party to an action brought for his or her benefit. The position was explained by Hutley JA in McIntosh v Williams [1976] 2 NSWLR 237, 250-1:

“A person on whose behalf an action is brought has an individual and personal claim for loss … The court can order a person who ought to have been joined as a party but is not to be joined … If it were necessary, the court could stand over the determination of the appeal so that [the infant] could appeal, as she has an individual personal right”.

70    Subsequently in McIntosh v Williams [No 2] [1979] 2 NSWLR 543, 560-1 Hutley JA added:

“Though only one action can be brought, and it is for the benefit of all diverse claimants, those claimants have individual rights, and there may be occasion in which these individual rights would have to be vindicated. Instances in which the courts have had to treat rights as individual are to be found in Mead v Clarke Chapman & Co Ltd [1956] 1 WLR 76 and Mulholland v McCrea [1961] NI 135. As stated in McGregor on Damages, 13th ed … p 801 ‘the fact that only one action may be brought is … only designed to promote ease of administration, and the action is given to the dependants as individuals and not as a class, so that each dependant is entitled to compensation for the loss resulting to him personally’.”

71    This has been settled law for a very long time. In Pym v The Great Northern Railway Co (1863) 4 B&S 397, 407 (122 ER 508, 512) Erle CJ, delivering the judgment of the Exchequer Chamber, said:

“The remedy … given by the statute is not given to a class but to individuals … this requires the jury to consider how each of the parties is situated, and how the interest of each is affected”.

72    The principles which govern an award under the Act for loss of the services of a mother were stated in Nguyen v Nguyen (1990) 169 CLR 245 at 254, 254 by Deane J:

“It has long been recognised that the loss of gratuitous domestic services, which are replaced or will be replaced at pecuniary cost, may provide a basis for compensation under Lord Campbell’s Act if the circumstances are such that there was a reasonable prospect of [the services] being rendered freely in the future but for the death … the assessment of the damages proportioned to the injury sustained may be more difficult … where the services have not been and will not be replaced than in a case where the actual cost of replacement services has been incurred … In both cases, however, the injury is the same. It is the loss of the services: ‘the widower, who does without and fends for himself, suffers loss as much as the widower who replaces the lost services with those of a housekeeper’: Budget Rent-A-Car Pty Ltd v Van Der Kemp [1984] 3 NSWLR 302, 309 per McHugh JA … That loss is a loss of a material benefit which is capable of being valued in monetary terms”.

73    Brennan J said 247, 249:

“When a claim is made for the loss of the services which would or might have been provided by a deceased spouse, the entire family situation before the death must be compared with the entire family situation after the death. By that comparison it is possible to ascertain the balance of the loss - on the one hand the savings made by the plaintiffs in consequence of the death and their exemption from providing services to the deceased spouse; on the other the benefits conferred on the plaintiffs by the deceased spouse - and the true nature and extent of the injury resulting from [the] death to the parties”.

74    At 263, 266, in their joint judgment, Dawson, Toohey and McHugh JJ said:

“… the deceased may have made a contribution in services rather than money in which case damages are recoverable for their loss, whether or not they are, or are to be, replaced, provided that a pecuniary value can be placed upon them … if the services are housekeeping services there is no reason why a pecuniary value should not be placed upon them … In some families, the children might reasonably have been expected in the course of time to have taken up, to a greater or lesser extent, the household duties previously performed by a parent. In that event, the loss incurred by reason of the death of that parent is the less. Of course, if the children take up the household duties, not in the ordinary course of events, but only because of the death of the parent, that will not reduce the total loss and it is irrelevant that the services do not need to be replaced by someone outside the household”. (emphasis supplied)

75    Dana only took up the household duties because of the death of her mother, and the Judge held, correctly, that her actions did not reduce the total loss. However he then ignored her contribution when apportioning this part of the award. When a widower “does without and fends for himself” he has been held to suffer loss as much as the widower who employs a housekeeper. The same principle should apply when an unmarried daughter such as Dana provides the replacement services. In doing so she suffers loss as much as the widower considered in Naum v Nominal Defendant [1974] 2 NSWLR 14, 16, and Budget Rent-A-Car Ltd v Van Der Kemp [1984] 3 NSWLR 303, 309. In Nguyen v Nguyen itself the widower, a recent migrant from Vietnam, who had not been able to obtain employment in this country, took over the role of housekeeper formerly undertaken by his late wife, and he was entitled to the damages awarded for the loss of his wife’s gratuitous domestic services. 76    In Mehmet v Perry [1977] 2 All ER 529 a widower who gave up full time employment to look after his young family was held to have acted reasonably. Brian Neill QC held that damages for the loss of his wife’s housekeeping services should be assessed by reference to his loss of wages, rather than the cost of employing a housekeeper (536) “because it represents the cost in the circumstances of providing the services of the plaintiff as a full time housekeeper in substitution for the deceased”. 77 This decision was followed in Cresswell v Eton [1991] 1 WLR 1113 and earlier in Watkins v Lovegrove, referred to at 1121-2, where Robert Goff J said:

“…it is well recognised that the pecuniary loss … recoverable … may include pecuniary loss suffered in the replacement of services rendered gratuitously by the deceased. This type of loss, is of course, of particular importance if the deceased was the wife of the dependant … a husband may be able to recover damages in respect of the cost of employing a housekeeper to perform the services previously performed gratuitously by his deceased wife. However, it may happen that the husband may decide himself to perform - for example in respect of the care of his children - services previously performed by his wife. If he acts reasonably in so doing, I can see no reason why … any pecuniary loss suffered by him in so acting should not be a recoverable head of damage as being a monetary loss incurred in replacement of services rendered gratuitously by his deceased wife. There is ample authority that such loss is so recoverable; for example … in Mehmet v Perry …”.

78    In my opinion therefore authority, as well as justice and principle, point to the conclusion that the Judge erred in his apportionment of the award for past care. If Dana had appealed against the apportionment I would therefore have been disposed, in the absence of a cogent argument from the widower or the brother, who have not been heard, to allow her appeal. Dana, who attained her majority in February 1990, has not appealed and has not been separately represented at any stage. However there is no reason to think that she is aware of her rights, and the respondent, her father, has not challenged the apportionment on her behalf. 79    What is the Court to do? It is not powerless because SCR Pt 51 r 22(1) provides that it may exercise its powers notwithstanding that there is no appeal from some part of the decision, that a party to the proceedings in the Court below has not appealed, or that any ground for allowing the appeal or varying the decision is not stated in any notice of appeal. 80    This makes it necessary to consider the duty, if any, owed by the respondent to his daughter in the conduct of these proceedings. In Erwin v Shannon’s Brick, Tile & Pottery Co Ltd (1938) 38 SR (NSW) 555, (Erwin) 560, 561 Jordan CJ held that every action under the Act:

“is brought by the plaintiff in a fiduciary character and inures for the benefit of all relatives within the class who have in fact suffered injury … it would be the clear duty of the plaintiff … to present properly the cases of all the interested dependants”.

81    In McIntosh v Williams [1976] 2 NSWLR 237, 246, 250-1 this Court, when ordering a new trial, made orders to ensure that the claim of an illegitimate child of the deceased, who was not then a party, was not ignored by the widow who was bringing an action for the benefit of the dependants. Hutley JA said, 251:

“The respondent has fiduciary duties to the class of dependants on whose behalf she is bringing this action, and it would be a breach on her part of her fiduciary duty to this child not to press her claim”.

82    See also per Samuels JA at 258; Avery v L & N E Railway Co [1938] AC 606, 613 per Lord Atkin; Erwin ibid 561 per Jordan CJ. 83    The nature of the discretion to apportion damages under the Act was considered in Gullifer v Pohto [1978] 2 NSWLR 353, 363, where this Court said:

“The apportionment specifically provided for by s 4 is a determination made between the claimants … The statute prescribes no criteria to be applied in making the apportionment. Different considerations may apply to the apportionment from those to be applied in the assessment of the award against the defendant. An example is the case earlier referred to where a loss of services of a wife and mother is shared in whole or in part by the widower and the children. If, to the date of trial, the widower has replaced the loss by the employment of substitute services, it will usually be proper to apportion the whole of the compensation for at least that part of the common loss to the widower. This is not the occasion to examine the exercise of the wide jurisdiction to apportion … ”.

84    The Court earlier said, at 360:

“… the loss of the household services rendered by the deceased … was sustained by the husband, but it was also sustained by the claimant children. So far as a child suffers such a loss it was a loss common to the child and father but compensable as one loss by the defendant. Usually, in assessing the verdict or judgment to be given against the defendant, it is not necessary to be concerned with the loss of their mother’s services by the children. The particular loss of such services sustained by a child claimant does require particular consideration when the court comes to determine the different question involved in apportionment of the judgment between the claimants … Upon the apportionment issue, the loss by the child is one which it can be expected will be replaced at the cost of the father, so that most of the common loss may properly be apportioned to the father. If however the child has suffered a loss to the date of trial without replacement .. the loss of the child, in addition to its relevance to the award against the defendant, needs to be brought to the account of the child in the apportionment ”. (emphasis supplied)

85    That of course is the present case because the loss by Dana of the benefit of her mother’s services was not replaced at the cost of the father or at all, and she has replaced the services lost by her father and her brother with services provided by herself, but these matters have not been brought to account in her favour in the apportionment. 86    In my opinion there has been a prima facie breach of fiduciary duty by the respondent towards Dana from which he will derive a substantial financial benefit which this Court should not ignore. The following orders should therefore be made:
87    (1) Appeal dismissed with costs.

(2) Order that the appellant pay into Court within 21 days the sum of $185,803 out of the judgment for $527,475 awarded for the cause of action under the Compensation to Relatives Act being the award for past loss of care together with post judgment interest accrued on that amount to the date of payment in.
(3) Pursuant to its powers under SCR Pt 51 r 22(1) the question of the proper apportionment of the monies ordered to be paid into Court between the respondent, Dennis Jelfs, and the other persons, Peter Jelfs and Dana Jelfs, for whose benefit the action was brought, is adjourned for a directions hearing before the President at 9.30 am on Friday 25 June.
(4) The respondent Dennis Jelfs is within 7 days to serve on Peter Jelfs and Dana Jelfs copies of the Court’s reasons for judgment including the orders therein and a letter from his solicitors informing them that the proceedings will be before the Court on the date referred to so that the Court can consider any application for a variation of the apportionment of the sum of $185,803 plus interest in Court representing the award for past loss of care before the monies are paid out of Court to the persons entitled and that the costs of those persons, reasonably incurred, are likely to be ordered to be paid out of the funds in Court.

88    GILES JA: I agree that, for the reasons given by Mason P, the appeals should be dismissed with costs. I adopt for myself what his Honour has said in paras 58 and 59 of his reasons.

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