Rosecrance v Rosecrance

[1999] HCATrans 178

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Darwin  No D6 of 1998

B e t w e e n -

MARION FRANCES ROSECRANCE

Applicant

and

JOHN DANA ROSECRANCE by his litigation guardian       JOHN CHARLES ROSECRANCE

Respondent

Application for special leave to appeal

McHUGH J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON FRIDAY, 18 JUNE 1999, AT 1.03 PM

Copyright in the High Court of Australia

MR S.W. TILMOUTH, QC:   May it please the Court, I appear with my learned friend, MR I.D. NOSWORTHY, for the applicant.  (instructed by Ward Keller)

MR C.G. GEE, QC:   May it please your Honours, I appear with my learned friend, MR A.J. LINDSAY, for the respondent.  (instructed by Cridlands)

McHUGH J:   Yes, Mr Tilmouth.

MR TILMOUTH:   May it please your Honours, may I begin by drawing your attention to a submission we filed and served earlier this week.

McHUGH J:   About the consent?

MR TILMOUTH:   Yes, may it please the Court.  That matter is self‑catering, so to speak. 

McHUGH J:   Yes.

MR TILMOUTH:   Your Honours, while I have drawn your attention to that outline, however, may I deal with the damages issues which is addresses, that is, the interest issue on the question of pre-trial pain and suffering.  Your Honours, the point of the cases cited at page 2 of that outline is to demonstrate that the Northern Territory Supreme Court is out of step with the rest of the case law in Australia.

McHUGH J:   Well, let that be so.  It is a matter for each jurisdiction, is it not, and no objection was taken on your behalf to this practice in the NT.

MR TILMOUTH:   Can I answer that in two ways, if the Court pleases.  First of all, as to each jurisdiction:  it is not a question, in our submission, of the interest rate.  It is a question of the principle that the interest awarded on this head of damages is normally reduced by half to reflect that the pain and suffering aggregates over the period rather than being caused to its full extent over the entire period.

McHUGH J:   Yes, I know, but I get the impression that in the Northern Territory the longstanding practice has been to give 4 per cent on the whole amount.

MR TILMOUTH:   Yes, it is.  But, if the Court pleases, in our submission, that does not reflect the question of principle.  The question of principle is that once the interest rate is fixed, as it is in Gogic and applied in the Northern Territory, the next principle is that should it be aggregated because the pain and suffering is not suffered to its full extent?  That is the question of principle we sought to agitate.

As to the question not being raised, that is not entirely accepted, If the Court pleases, but may I ague the point on the basis that it was not?  It would not have made any different, if the Court pleases, because the trial court was bound by the established practice.  It was not a question which required evidence to be called.  There was no suggestion of us calling actuarial evidence to suggest that 4 per cent was inappropriate and should be reduced or increased.  It was simply a question of agitating the principle that it was inappropriate to automatically apply it to the entire period.       So, it was always a matter with the court, if the Court pleases, that could only have been resolved by the Court of Appeal.

McHUGH J:   That may be.  That is one argument.  The other argument is that a practice having been established, that until the court is persuaded by evidence that it is not appropriate in the Northern Territory, then the court will follow it.  What justification did the court have, of its own motion, departing from its long-established practice, just on the submission of counsel?

MR TILMOUTH:   With respect, it was not a matter which demanded evidence.  The only evidence that was relevant was the medical evidence as to how the pain and suffering accrued and so on.  There was no evidence that could have been called, as I have already pointed out, of an economic or other kind.  This point did not demand evidence at all.  It was simply a question of principle that you do not automatically grant the full interest component for the whole period.

McHUGH J:   Yes.  Correct me if I am wrong, but the practice seems to be that they do it in the Northern Territory, rightly or wrongly.

MR TILMOUTH:   If the Court pleases, the practice follows Gogic:  4 per cent.  When it came before Justice Mildren, the only two judgments which illustrated the practice were a single instant decision of his own and one of Justice Angel.  There was no binding Full Court precedent to that effect at all.  If the Court pleases, when it came to the Full Court, they referred to the practice for the whole period based essentially on single judge decisions.  The further point I make, if the Court pleases, is this:  the only way the matter can be sorted out now is by this Court. 

McHUGH J:   Why can you not go back to the Full Court in another case and submit that it is inappropriate and that they should follow what has been done in other States?

MR TILMOUTH:   Because this is a binding precedent, if the Court pleases.  The doctrine of precedent would require us to convince the Full Court now that this decision was plainly wrong.  So, it is not only clearly binding on the single judges of the - - -

McHUGH J:   Well, you take me to the passage which you say makes it clearly binding.

MR TILMOUTH:   At page 104, if the Court pleases is where the matter was essentially dealt with, at line 26 of the Full Court’s decision:

The settled practice in the Northern Territory is to arrive at an appropriate rate based on evidence.  At that time actuarial evidence was called and Muirhead J set an interest rate of 12% for the damages where the cause of action arose after 1 December 1979.

We consider that before changing what has become the settled practice to award 4% on the non-economic loss items this Court should heard evidence.

Now, with respect, the point was not the percentage of the interest to be awarded.  That was accepted as 4 per cent.  There is no question about that.

McHUGH J:   Well then, on that basis, the court does not deal with what you say is the real point.

MR TILMOUTH:   That is right.  In our submission, the court, with respect, misunderstood the point.

McHUGH J:   That does not make it a special leave point.

MR TILMOUTH:   The only way, with respect, it can be sorted out for the Northern Territory is this Court, if the Court pleases.  In our submission, this is now binding on the Northern Territory Supreme Court.  It does not demand evidence at all.  It never did.  It is a question of principle; the principle which I have already outlined.  In my submission, it is important to note that the only way the Northern Territory can be brought into line with the rest of Australia is for this Court to do something about it.

Your Honours, while I am on damages, can I mention the other issue in relation to the matter and that is the question of the reduction made by the learned trial judge in the cost of purchasing a new and more suitable home to reflect a joint interest of both the plaintiff and the defendant as they were in the lower court.

Your Honours, the convenient reference point is to take your Honours to page 138 of the application book, but while I am taking you there, can I ask your Honours to accept that it was never in dispute that the home which was previously owned and, indeed, the new home that was purchased, were both in joint names.  That is a factual given in this case.

The submission was made a trial that the cost of purchase the new home which was an additional $360,000 had to be reduced by half to reflect the fact that half of the interest was held by the applicant and half by the respondent.  His Honour accepted that.  However, the Full Court overturned him on that issue and that happened at page 138.  The cross-appeal ground which was, of course, the respondent’s appeal in the Full Court, is quoted at 138, line 20.  The court then went on to refer to the amount of money that was involved.  His Honour did not give the $360,000.  He assessed  the present-day value of that amount of money.  So, what was at stake was a share of about $US96,500.

The court went on to refer to Kars v Kars, a decision of this Court, and to observe the principle in that case that it was a question of the plaintiff’s need.  Then, if the Court pleases, the court proceeded as follows, at line 40 on 138:

It was agreed between the parties that it was necessary for the expenditure of the $360,000-00 to be incurred to provide the plaintiff with a suitable home.  However, he was not awarded that capital sum, but an amount calculated to provide him with the additional annual cost over his lifetime of providing the home.

Could I just pause there to observe, your Honours, that the respondent before this Court had actually cross-appealed on that as well but had lost that point in the preceding pages to those that I am just reading.

That amount is notionally intended to be exhausted on the plaintiff’s death.  We have difficulty in reconciling the notion that an award designed to meet the plaintiff’s need, which will be exhausted upon his death, should be halved because the application of the fund may incidentally provide a benefit to another person.

CALLINAN J:   Is that not the point though?  It may incidentally do so.  Whether it in fact does so in any particular case, assuming that one has to go as far as this, would be a matter of evidence.  I can think of expenditures which might not produce any extra value at all, not only to the joint owner but also to the injured person.

McHUGH J:   Indeed, may reduce the value.

MR TILMOUTH:   That is true, and in this case his Honour allowed the full measure of around $74,000 for additional improvements.  So, the plaintiff in the court below got the full measure of those modifications.  If the Court pleases, the plaintiff here was protected by the capital increment of the property.  Where the error occurred, putting that aside, is in the following passage at the top of 139:

Had the plaintiff been aware of the likely outcome, he may well have astutely avoided it by otherwise ordering his property interests so as to defeat such a rule.

McHUGH J:   Yes, but it is really a throwaway line.

MR TILMOUTH:   If the Court pleases, it is more than that, in my submission.  It is the only justification which is given for allowing the cross‑appeal on this point.  It does not meet the primary argument that the actual loss that the plaintiff suffered was his interest in the house.  That was the actual expenditure that was incurred.  What I have just read out, if the Court pleases, was the type of reasoning which was condemned in Kars v Kars as putting form over substance and bringing the law into disrepute.  In our submission, whether it is a throwaway line or, as we submit it more than that, it is the only rational provided by the court and it does not sit and is inconsistent with Kars v Kars.

McHUGH J:   I would have thought that if it was necessary for $360,000 to be spent on the home, then the plaintiff was entitled to be reimbursed for that sum of money.

MR TILMOUTH:   With respect, there was no question of reimbursement of the whole because he only expended half of it because it was a joint home.  He is protected in any event by the capital increase - - -

McHUGH J:   I am not sure whether he is only entitled to half of it.  I do not see any reason why he should not get the lot of it.  Supposing the other partner says, “I’m not going to spend any money.  This is for your benefit.  You spend it.”

MR TILMOUTH:   That was not the case here, if the Court pleases.  The driving principle is you take the plaintiff as you find him or her.  That was the fact in this case.  It is important, if the Court pleases, because in many cases there will be a relationship, either husband and wife, or in some of the reported case your Honours may have noted that it is a question of parents having to buy alternative housing and the like.  So, it is important.  It has wider implications in this case.

CALLINAN J:   Where is the evidence that it did provide a financial benefit to the other person?

MR TILMOUTH:   It was accepted that that was the capital increased value.  The $360,000 was a measure of the increased value.

CALLINAN J:   That is assuming that expenditure equals value, price equals value, is it not?

MR TILMOUTH:   It does, if the Court pleases, but as I understand it, no argument was made to the contrary to that.

CALLINAN J:   I would need a lot of persuasion that that is so.  Hotels usually let out the rooms that are provided for handicapped people, when they are not occupied by handicapped people, at a considerably reduced rate.

MR TILMOUTH:   They may do, if the Court pleases.  That issue was dealt with in terms of whether or not the additional money to modify the house was a capital appreciation or a diminution and his Honour, in effect, held that one factor counterbalanced the other and he gave the full amount.  In my submission, the plaintiff’s need has been catered for in that allowance.  But the plaintiff is wholly protected in this case, if the Court pleases, by the capital appreciation which was accepted.  In my submission, it is to ignore the facts of this case and the reality that he would always be protected.  Once he had an award for the present-day value of that expenditure, his loss has always been protected in those allowances.

The only other point that I can make in relation to this, and it is important.  So far as our researches indicate and so far as the list of authorities of the respondent indicate, this actual issues has not been dealt with in any court of authority whatsoever and, in our submission, it is an important point in relation to this type of matter which will arise not infrequently because of the relationship of people who are injured, close relatives or, indeed, spouses, in motor vehicle accidents. 

Your Honours, can I move then to the issue of liability, and this raises, in our submission, an important point for negligence cases in general.  I go back to page 5 of the application book, if the Court pleases.  Your Honours, his Honour made primary findings in the four pages preceding this page on liability.  His Honour then turned his mind to the question of contributory negligence and made a reference to the decision of the Court of Appeal of New South Wales in Hoare v Rudd, at line 29, to the effect that at the stage of contribution negligence it was worth recalling and bearing in mind, to use his Honour’s words at line 40, the Briginshaw test or onus.

Now, in our submission, that was in this case and, with respect in Hoare v Rudd, was to introduce a wholly extraneous and irrelevant consideration to the case.  There is no reason, if the Court pleases, in principle, why the Briginshaw test, or whatever else one wants to call it, should be introduced in negligence cases at all.

McHUGH J:   But the Briginshaw test only applies to civil standard.  What it does is it requires you to have regard to the seriousness of any facts which give rise to the allegation of contributory negligence in this case.  What is the matter with that?

MR TILMOUTH:   But, with respect, why apply it only to contributory negligence?

McHUGH J:   No, you can apply it to anything.

MR TILMOUTH:   That is the point, if the Court pleases.  It is discriminately applied here to contributory negligence but not primary negligence.

McHUGH J:   No, the judge was simply reminding himself, as the Full Court said, to have regard to some of the allegations that are made against him.

MR TILMOUTH:   With respect, why not do the same thing when it comes to primary negligence? 

CALLINAN J:   Mr Tilmouth, could I say something to you.  I personally think that it may not have been apt to refer to Briginshaw but it seems to me that at page 7, about line 41, there is a finding against you which does not involve any application of the Briginshaw test, albeit that his Honour may have referred - indeed, perhaps, erroneously referred - to it earlier.  That the finding seemed to be sufficient, I would have thought, to satisfy any ordinary civil test at all against you:

I am not able to find that the defendant has proven, the burden being on the defendant, that the belt available to be used by the plaintiff was in good working order.

MR TILMOUTH:   Yes.  Well, can I point your Honour to the two passages that precede that which govern that - - -

CALLINAN J:   Yes, I have read those, Mr Tilmouth.

MR TILMOUTH:   Well, he talks of possibilities in those two passages.

CALLINAN J:   I have read those but I think they are all, in fact, affected or coloured by his Honour’s conclusion on it, although, as I say, I have grave reservations about the reference at all to Briginshaw, for myself.

MR TILMOUTH:   Yes.  My point, of course, is that, with respect, it is the first passages which lead to the conclusion in the last one and it is undeniable – his Honour used the word “possible” at line 35 and at line 40, which, of course, if the language of Briginshaw, and if not, if the Court pleases, the language of the criminal law.

Your Honours, can I also make the submission that the Full Court was infected with the same error although not as directly.  But can I take your Honours to page 101 because, in my submission, a serious error occurred here.  At 101, line 15 or 16, their Honours said:

A review of the evidence shows that the matter remains one of speculation –

which, of course, picks up the passage your Honour Justice Callinan put to me just then –

there being no precise evidence on the question of how wearing a seat belt would have made any difference.

Now, your Honours, in the court below, the applicant called a Mr Gillies and his evidence was that if the seat belt was being worn, there was very little chance that the serious injuries that were suffered in this case would have been suffered.  In our submission, bearing in mind the time, that is a very serious error in the Court of Appeal and it duplicates, in my submission, what, in the end result, was the same error in the court below.

That finding was made on pure speculation and it is not right to say there was no precise evidence on the point.  There was.  When his Honour made his observations as he did in relation to whether or not the injuries would have been the same, at page 14, what he embarked upon, in my submission, is essentially speculation.  There was sound evidence that the injuries would not have been the same.  What his Honour did at page 14, in my submission, was to reason what the likelihood or probabilities were

essentially on an unproven or speculative base.  In my submission, having cited Briginshaw, it crystallised not only as a mere side reference but it crystallised into the factual findings at page 14.

Could I finally say, may it please your Honours, that now we have the situation where two courts of appeal in this country have endorsed the application or reference to the Briginshaw onus isolated to the issue of contributory negligence when there is no principle which requires that and which is a serious error because the same may be said with equal or more force to findings of primary negligence.  In our submission, there should be no different standard whatsoever.  In fact, if anything, the greater seriousness occurs at the stage of finding negligence rather than contributory negligence because the latter will always be lesser than the former.  If the Court pleases.

McHUGH J:   Yes, the Court need not hear you, Mr Gee.

As to the claim that the Court should grant special leave because of the reference to Briginshaw v Briginshaw, in our view, and without in any way endorsing what the trial judge or the Court of Appeal said about Briginshaw, having regard to the findings that were made by the learned trial judge after the reference to Briginshaw’s Case this is not a case calling for the grant of special leave.

The second point raised in support of the special leave application is that the trial judge erred in applying the 4 per cent interest rate to the whole of the amount awarded for non-economic loss instead of half of that amount, as is the practice in the States.  However, the application of interest rates to non economic loss is a matter of practice in each jurisdiction.  If the practice of applying 4 per cent interest to the whole of the amount in the Northern Territory is to be overturned, and that practice appears to be the current practice in that Territory, it should be done by the Supreme Court or the Court of Appeal of the Territory after hearing evidence.

As to the third point, that the Court of Appeal erred in adding another $96,500 to the plaintiff’s claim for the expenditure to be incurred in providing the plaintiff with a suitable home, the case raises no point warranting the grant of special leave to appeal. 

In those circumstances, the application for special leave to appeal is refused.

MR GEE:   If the Court pleases, we ask for costs.

McHUGH J:   Yes.  You cannot oppose that, Mr Tilmouth.

MR TILMOUTH:   No, it is conceded on the papers, your Honours.

McHUGH J:   Special leave is refused.  The applicant must pay the costs of the application.

AT 1.27 PM THE MATTER WAS CONCLUDED