Sahin v Victorian WorkCover Authority
[2017] VSCA 13
•10 February 2017
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2016 0108
| EDLIBAN SAHIN | Applicant |
| v | |
| VICTORIAN WORKCOVER AUTHORITY | Respondent |
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| JUDGES: | WARREN CJ, BEACH JA and CAMERON AJA |
| WHERE HELD: | MELBOURNE |
| DATE OF HEARING: | 3 February 2017 |
| DATE OF JUDGMENT: | 10 February 2017 |
| MEDIUM NEUTRAL CITATION: | [2017] VSCA 13 |
| JUDGMENT APPEALED FROM: | [2016] VCC 829 (Judge O’Neill) |
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ACCIDENT COMPENSATION – Appeal – Application for leave to appeal – Industrial accident – Damages – Assessment of pecuniary loss damages – Loss of earning capacity – Assessment of loss of earning capacity – Bases of assessment of damages for loss of earning capacity – Whether judge erred in assessment of pecuniary loss damages – No error in judge’s assessment – Accident Compensation Act 1985, s 134AB.
INTEREST – Interest on past pecuniary loss damages – Interest from date of commencement of proceeding until date of judgment – Supreme Court Act 1986, s 60 – Accident Compensation Act 1985, s 134AB(34).
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| APPEARANCES: | Counsel | Solicitors |
| For the Applicant | Mr C Sahin in person | |
| For the Respondent | Mr M F Wheelahan SC with Mr M J Hooper | Hall & Wilcox |
WARREN CJ
BEACH JA
CAMERON AJA:
On 27 October 2004, Mrs Edliban Sahin, the applicant, was packing oranges into cardboard boxes in the course of her employment with Auchronie Fruit Co Pty Ltd (‘Auchronie’). Having completed packing one of the boxes, the applicant attempted to push the box from a packing bench onto a conveyor belt. In the course of performing this action, the applicant suffered an injury to her right wrist. The next day, the applicant returned to work for a short period but, aside from a brief attempt to return to work, the applicant has not worked since suffering her injury.
On 19 September 2014, a County Court judge (Judge Lawson) gave leave to the plaintiff pursuant to s 134AB of the Accident Compensation Act 1985 (‘the Act’) to commence a proceeding against Auchronie.[1] Leave was given to the applicant to commence a proceeding claiming both ‘pain and suffering damages’ and ‘pecuniary loss damages’.[2]
[1]Sahin v Auchronie Fruit Co Pty Ltd [2014] VCC 1550 (‘Serious Injury Reasons’).
[2]As those expressions are defined in s 134AB(37) of the Act.
Pursuant to the leave granted, the applicant commenced a proceeding in the County Court claiming pain and suffering damages and pecuniary loss damages in relation to her injury. The defendant in the County Court proceeding was, and the respondent in this Court is, the Victorian WorkCover Authority. After leave was given to commence a proceeding, Auchronie became deregistered, and the respondent was sued as the insurer of Auchronie pursuant to s 601AG of the Corporations Act 2001 (Cth).
On 22 June 2016, following an 11-day trial, Judge O’Neill of the County Court published reasons for judgment in which he found for the applicant and assessed the applicant’s damages as follows:
Pain and suffering damages: $225,000
Past loss of wages: $220,000Future economic loss: $132,000
Fox v Wood[3] component: $ 4,557_______
TOTAL $581,557[4]
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[3]Fox v Wood (1981) 148 CLR 438 (‘Fox v Wood’).
[4]Sahin v Victorian WorkCover Authority [2016] VCC 829 (‘Reasons’).
On 24 June 2016, the judge, after deducting amounts required to be deducted pursuant to s 134AB(25) of the Act, entered judgment for the applicant in the sum of $555,592. This amount included damages in the nature of interest in the sum of $11,000.
The applicant seeks leave to appeal in relation to the judge’s assessment of her damages for past loss of wages, future economic loss and interest. The applicant’s grounds of appeal are as follows:
1.His Honour erred in law by not applying the applicant’s loss of earning capacity when assessing the applicant’s past and future loss of earnings.
2.His Honour erred in law when limiting the applicant’s retirement age to 55 when assessing the applicant’s future loss of earnings.
3.His Honour erred in law when assessing the interest on the past loss of earnings of $220,000 over 11.8 years at 10 per cent to be $11,000.
In her application for leave to appeal, the applicant contends that her past loss of earnings (after a deduction of $36,965 required by s 134AB(25) of the Act) should have been assessed at $436,924, her loss of earning capacity should have been assessed at $531,002 and interest should have been assessed at $257,785. The applicant does not cavil with the other amounts assessed by the judge. Accordingly, the applicant seeks the setting aside of his Honour’s judgment and an order in lieu that there be judgment in her favour in the sum of $1,455,268.
The respondent submits that no error was made by the judge in his assessment of the applicant’s loss of earning capacity (past or future), but concedes that the judge erred in his assessment of the applicant’s entitlement to interest. The respondent contends that, consistently with s 60(1) of the Supreme Court Act 1986 and s 134AB(34) of the Act, the judge should have assessed the applicant’s entitlement to interest in the amount of $24,492. The respondent contends that the applicant should be granted leave to appeal on ground 3 only and that the award of interest made below should be set aside and substituted with an award of interest in the amount of $24,492. It also submits that the applicant should be refused leave to appeal in respect of grounds 1 and 2, ‘as those grounds have no reasonable prospect of success’.
The trial
At trial, the judge permitted the applicant to be represented by her husband. The applicant gave evidence through an interpreter. During the course of the trial, and in the respondent’s final address, the applicant’s credit was the subject of a substantial attack by the respondent.
As part of her case, the applicant called her husband, Mr Cetin Sahin, and her son, Mr Alper Sahin, to give evidence. She also called Ms Muberra Acikgoz, a friend of the applicant who had worked for Auchronie between 2001 and 2006.
The respondent called a former director of Auchronie, Mr Denis Ryan, and two former employees of Auchronie, Mrs Margaret Allford and Mr Steven Allford. Mr and Mrs Allford both worked for Auchronie over a number of years, including in 2004.
A substantial body of medical evidence was called by the parties at trial (both viva voce evidence and by way of the tendering of medical reports and records). It is not necessary to describe this evidence because, in this Court, there is no relevant dispute about the judge’s findings in relation to the injury sustained by the applicant and the medical consequences of that injury.
The judge’s reasons
While the issue of negligence and contributory negligence were live issues before the judge, as we have already noted, the judge decided these issues in favour of the applicant. The only issues before us concern the judge’s assessment of the applicant’s pecuniary loss damages and interest. That said, the judge said in his reasons that he did have reservations about the credibility of the applicant.[5]
[5]Reasons [206]. See also, the discussion at [207]–[220].
After carefully analysing the evidence, the judge concluded that the applicant suffered a soft tissue injury to her right wrist, and (relying upon the evidence of a medical specialist, Mr Behan) accepted that a ganglion that had developed some time after the injury was also work-related. The wrist injury was a soft tissue injury, for which the applicant had had conservative treatment. The judge said that ‘in the scheme of things, the soft tissue wrist injury and the ganglion [were] not of great significance’.[6]
[6]Reasons [258].
The judge then went on to deal with the disputed issue of whether the applicant had developed a complex regional pain syndrome (‘CRPS’) and whether any CRPS from which the applicant suffered was related to her injury. After analysing the evidence, the judge said that he was satisfied that the applicant had developed a CRPS and that the development of this disorder was related to the initial incident.[7] The judge went on to say:
I accept that Mrs Sahin does suffer pain in the wrist, up the elbow, to the shoulder and side of the head, which pain is far in excess of what one would expect from a relatively minor soft-tissue injury. I accept that, to an extent, Mrs Sahin genuinely feels this pain but, for reasons which I will shortly analyse, I am of the view that she is exaggerating the pain in these areas and the effect upon her.[8]
[7]Ibid [269]–[270].
[8]Ibid [271].
Next, the judge analysed the medical evidence that dealt with whether the applicant had sustained any resultant psychiatric or psychological injury. Having analysed this evidence, the judge said he accepted that the applicant had a significant depressive disorder. The judge said that the applicant was ‘obviously debilitated as a result of the combination of the CRPS and a significant depressive disorder’.[9]
[9]Ibid [279].
The judge then dealt with the applicant’s claim that she suffered from ulcerative colitis, which was said to have arisen as a result of the applicant’s original injury. The judge accepted the evidence of a Dr Jakobovitz that the applicant had developed ulcerative colitis in 2007 and that ‘the workplace incident was, at least, an aggravating factor’.[10]
[10]Ibid [281].
At trial, the respondent submitted that the applicant had a vulnerability or predisposition to the development of the ganglion and to the onset of a psychological disorder. These issues were the subject of cross-examination of the applicant, and were also the subject of medical evidence at trial. There was medical evidence that the applicant may have developed the ganglion in her wrist in any event and that ‘the wrist was vulnerable’.[11] There was also evidence of some vulnerability in the applicant to developing the type of soft tissue injury that she developed.[12] Ultimately, the judge said:
In my view, notwithstanding the evidence of Mr Behan, the future course of any underlying physical or psychological condition, even vulnerability, is speculative. Even accepting Mrs Sahin was vulnerable in some way, there is no precision as to the future course, whether that be in relation to the development of a ganglion, the onset of CRPS or some overwhelming psychological condition. In my view, it is more appropriate to deal with this issue when a consideration is made as to the vicissitudes of life and when one goes to weigh those factors, both of a positive and negative nature, which may have affected Mrs Sahin’s life.[13]
[11]Ibid [283].
[12]Ibid [284].
[13]Ibid [288].
Having regard to the complaints made by the applicant about the judge’s assessment of her past and future pecuniary loss, it is appropriate to set out in full the judge’s conclusions on those topics. In respect of past loss of wages, the judge said:
I am satisfied Mrs Sahin has had little, if any, capacity for employment from the time of the incident to the present. While, initially, the injury was a relatively minor wrist strain, it has subsequently developed into CRPS with a significant psychological disorder. It may be argued Mrs Sahin had some work capacity within a year or two of the happening of the incident, but her return to work was not assisted when she was placed back on the production line (not the packing line) performing sorting in an attempted return to work. I accept that she suffered some sort of motion disorder which made it difficult for her to remain there. While a better managed and more sensitive return-to-work program may have led to her being able to return to the workforce, even on a reduced basis, that did not occur. Further, she is a person of limited English from a migrant background, and whose only employment in Australia has been of a manual nature, working in fruit-packing sheds. Anyone with a wrist injury, let alone someone who has developed a significant emotional or psychological reaction, would find a return to work difficult.
To that end, I am satisfied Mrs Sahin is entitled to loss of wages from the date of incident through to the present time. The significant issue is as to the appropriate sum upon which loss of wages should be based.
Mr Sahin submitted that, according to his wife’s evidence, she was, at the time, working on a seasonal basis, but was looking for full-time work, which she was unable to find. There was no further evidence as to her future intentions. Mr Sahin said it was reasonable to infer that, as her children grew older, she would return to work on a full-time basis. He said account should be taken of the fact that she had worked in Australia over a long period, both for employers and on the family fruit block and was a woman with a good work ethic in a family which had limited financial resources. In these circumstances, said Mr Sahin, it was reasonable to infer that she would have returned to full-time work. He said it was well known that, at least at the present time, the fruit packers were able to move from one fruit to another and, thus, work a full twelve months of the year.
However, the evidence of Mrs Sahin’s future intention as to work was very limited. It is clear from her taxation returns that her earnings were modest and that she was working only seasonal work over the years 2000 to 2005. In my view, there is not sufficient evidence to draw the inference which Mr Sahin asserts. His wife may have returned to full-time work across a number of areas of packing when the children were older but, also, she might not have. Mr Sahin had completed work on the family house and there was the prospect that he would return to full-time employment. As with any agricultural industry, there are periods where there is a lot of work available for manual workers, and times when there is not.
The appropriate basis to assess loss of earnings and loss of earning capacity, in my view, is to take account of the earnings of Mrs Sahin in the years leading up to the incident.
In his submissions, [counsel for the respondent] analysed Mrs Sahin’s taxation returns and concluded that the sum of $15,000 was a fair, even favourable, figure at which to assess Mrs Sahin’s earnings as at the date of injury. That was largely based upon the returns for the years 2004 and 2005. For the reasons set forth by [counsel for the respondent], I accept that submission. That translates, with the cost of living increases, to a gross figure of $21,386 at the present time. Taking a midpoint, $18,193 provides a figure of approximately $210,000. Allowing a modest amount for taxation, and paying some regard to the prospects of improvement with the proper treatment over the years to date, it is appropriate to assess past loss of earnings at $200,000. Adding superannuation of 10% brings the total past loss to $220,000.
I would not reduce this sum for any other vicissitudes.[14]
[14]Ibid [298]–[304] (footnotes omitted).
In respect of future economic loss, the judge said:
I accept that had Mrs Sahin remained in employment she would be earning something in the order of $21,386.00 gross per week at the present time.
I accept the evidence of various of the practitioners, including Ms Durmaz, the treating psychologist, and Mr Behan, the hand surgeon, that realistically, Mrs Sahin has no work capacity. Even accepting there was an element of exaggeration in her physical presentation, nonetheless she is a woman of limited English working in manual employment and with a significant psychological condition. In these circumstances, I am satisfied she has no work capacity and that that is likely to continue. There is the prospect of some improvement as Mr Behan referred to, but it has now been almost twelve years since the incident and the situation is, if anything, getting worse.
Mrs Sahin gave no particular evidence as to the age to which she would have worked. There was evidence that some in the fruit packing industry worked to sixty years and beyond, but it is relatively arduous employment. Mrs Alford said an average retirement age is fifty-five. I am satisfied it is appropriate to assess loss of earnings to age fifty-five. The multiplier (6 per cent tables) is 300 by $411.00 per week allows damages for loss of earning capacity at $123,300 gross or $120,000 net. Allowing 10 per cent for superannuation, brings this figure to $132,000.
In addition to all the usual vicissitudes, I bear in mind Mr Sahin’s argument that his wife would have increased her hours and further, [counsel for the respondent’s] argument that Mrs Sahin had a vulnerability to both physical and psychiatric injury. Weighing these matters, in my view, it is appropriate to make no allowance for vicissitudes.
The parties have agreed the Fox v Wood component at $4,557.00.[15]
[15]Ibid [305]–[309] (footnotes omitted).
The applicant’s evidence
The applicant gave evidence that she was born and educated in Turkey. She completed high school, and then worked for two years at a hospital. She said she performed ‘different jobs, like secretary and like, tax work’. The applicant was married in December 1988. In 1989 she emigrated to Australia. The applicant had two sons, Caner, born in March 1990 and Alper, born in December 1992.
While the applicant gave evidence in relation to all issues that were in dispute at trial, relevantly so far as her claim for loss of earnings and loss of earning capacity was concerned, the applicant gave evidence that she attended the Mildura TAFE in 2000, where she completed a number of studies. In 2000, the applicant said she worked as an asparagus packer. In 2001, the applicant said that she performed work packing oranges. In 2002, the applicant said that she did some grape picking. The applicant’s evidence was that in the latter half of 2002, she started employment with Auchronie doing work packing oranges.
The applicant was asked in evidence-in-chief how many hours a week she was working immediately prior to her injury. She said:
I can’t remember the hours, but I used to work long hours because my children had grown up. They could go to school by walking. And then I was comfortable enough, I was — I was able to work.
The applicant was asked whether she was working full time when she suffered injury. She said:
I was looking but I couldn’t find full time work. When it was the grape season I would work in grapes. When it was the oranges season I would work in oranges.
The applicant said that she worked ‘the full 12 months of the year in 2004’. She said she worked eight hours per day, but that some days she worked more hours. Just prior to the injury, the applicant said that there were weeks when she worked 45 hours and 47.5 hours, and that she had worked a week of 60 hours.
In cross-examination, the applicant was challenged about the extent of her work history prior to her injury. During the course of cross-examination, the applicant’s tax returns for the financial years ended 30 June 2000, 2001, 2002, 2003, 2004 and 2005 were put to her. The applicant’s tax returns disclosed that the applicant did not earn income in the financial years ended 30 June 2000 to 2002. In the financial year ended 30 June 2003, the applicant’s total gross wages were $12,125. For the financial year ended 30 June 2004, the applicant’s total gross wages were $9885. For the period from 1 July 2004 to 27 October 2004, the gross wages paid by Auchronie to the applicant were $7224. Unsurprisingly, the applicant was not able to remember the precise figures. That said, the applicant was not able to dispute the income figures shown in her tax returns.
Notwithstanding the fact that the applicant had an ongoing claim for loss of earning capacity, at no time in her evidence did the applicant give any evidence about her intentions in respect of future work. Specifically, the applicant did not give any evidence about how long or in what capacity or capacities the applicant intended to work but for suffering her injury.
The applicant’s husband’s evidence
So far as the applicant’s employment was concerned, her husband gave evidence that, at the time the applicant suffered injury, the applicant ‘was looking for full time employment, working long hours … 60 hours, 50 hours, and she enjoyed that’. Mr Sahin said that, but for her injury, the applicant ‘was basically free to work long hours’. Mr Sahin went on to say that:
Maybe if the incident didn’t happen she’d still be working in her field of work or maybe even in her field of work or maybe even as a supervisor or ----.
Mr Sahin went on to say:
She was always doing something — and at that point in time where she injured her hand she was working long hours, making good money and the future looked good.
Other evidence about fruit packing work
Ms Acikgoz gave evidence about the nature of fruit packing work, with particular reference to her employment with Auchronie. Ms Acikgoz said that working as a packer in the fruit industry in Mildura was unpredictable as to how much work you would get from year to year. It was never full time. Ms Acikgoz said the work could get very difficult and that it could be ‘really difficult to push the boxes because they’re really heavy’. She said that sometimes one needed a lot of strength to push a box and that you could be under pressure to work fast. She said:
Like sorting is really quick, you have to be really quick. And not everybody can sort. You can — you can get dizzy, or nausea from the — watching the oranges rolling all the time. Makes you really dizzy.
Mrs Allford, who as we have said was employed by Auchronie in 2004, was asked what the average retirement age was in the packing shed. Mrs Allford gave evidence that it was 55. She went on to say that she was 55 and could still pack oranges eight hours a day, but that she also had a supervisory role as well. However, against this evidence, it is to be noted that, in the course of his evidence, Mr Ryan identified an individual who had still been working at the age of 60 or 65 years and packing up to 100 boxes a day.
Grounds 1 and 2: the applicant’s complaints about the judge’s assessment of her pecuniary loss damages
In grounds 1 and 2, the applicant makes a number of complaints about the judge’s assessment of her past and future loss of earning capacity. First, it is said that the judge did not apply the law as stated by the High Court in Husher v Husher.[16]Specifically, the applicant submits that the judge wrongly looked at the earnings she received prior to suffering injury rather than taking into account her earning capacity.
[16](1999) 197 CLR 138 (‘Husher’).
Secondly, the applicant submitted that the judge was wrong to rely upon the figures in her tax returns. It was said that these figures should not be relied upon because, in part, they consisted of weekly payments of compensation made after the applicant suffered injury and were not reflective of the applicant’s true earning capacity.
Thirdly, relying upon individual payroll statements that were tendered at trial and a concession made in the applicant’s serious injury proceeding, the applicant submitted that her loss of earning capacity (past and future) should have been assessed either at $855 per week, $727 per week or $676.88 per week. The source of the $855 figure was a payroll statement tendered at trial. The source of the $727 per week figure was a concession made by the respondent during the earlier serious injury application that the applicant’s gross average weekly earnings for the relevant period specified in s 134AB(38)(f) of the Act was $727. The $676.88 figure was claimed to be an average figure for working a 47.5 hour week.
Fourthly, the applicant submitted that the judge erred when he assessed the applicant’s future loss of earning capacity only to age 55 years. It was submitted that the law required the judge to assess the applicant’s total loss until normal retirement age, which was said to be 65 years.
In summary, the applicant contended that her loss of earning capacity should have been assessed from the date of injury to age 65 on the basis that she would have worked full time earning at least $676.88 per week from 27 October 2004 with appropriate increases from that time in line with ordinary rises in wage rates.
The resolution of grounds 1 and 2
The assessment of an injured plaintiff’s claim for loss of earning capacity suffered as a result of bodily injury involves questions of fact and degree, and requires estimates and judgments to be made, about matters upon which reasonable minds might differ. More often than not, in assessing an injured plaintiff’s loss of earning capacity, there is no one correct answer. One judge may take a more favourable approach to a party in respect of one issue upon which the assessment falls to be made, but a less favourable approach to the same party on another issue. As was said by the plurality[17] in Husher:
The assessment of damages for loss of future economic capacity involves questions of judgment and estimation. Being an attempt to predict what would have happened, the process can never be exact. The fact that calculations are made by multiplying present values of net income by the expected duration of remaining working life should not obscure that the process is necessarily inexact. Even so, the assessment of lost earning capacity requires some care in identifying (as best one can) what net income the plaintiff would have had at his or her disposal.[18]
[17]Gleeson CJ, Gummow, Kirby and Hayne JJ.
[18]Husher (1999) 197 CLR 138, 149 [25].
It is also correct to say that an injured plaintiff’s income tax returns may not always necessarily reflect a true measure of that person’s income earning capacity or that person’s capacity to earn income that has been lost as a result of an injury. Again, as the plurality said in Husher:
Since at least Graham v Baker it has been recognised that it is convenient to assess an injured plaintiff's economic loss ‘by reference to the actual loss of wages which occurs up to the time of trial and which can be more or less precisely ascertained and then, having regard to the plaintiff's proved condition at the time of trial, to attempt some assessment of his future loss’. But damages for both past loss and future loss are allowed to an injured plaintiff ‘because the diminution of his earning capacity is or may be productive of financial loss’. Both elements are important. It is necessary to identify both what capacity has been lost and what economic consequences will probably flow from that loss. Only then will it be possible to assess what sum will put the plaintiff in the same position as he or she would have been in if injury had not been sustained.
No doubt the past may provide important evidence about the plaintiff's earning capacity and what economic consequences will probably flow from what has happened. What a worker earned in the past may provide very useful guidance about what would have been earned if that worker had not been injured. But the inquiry is an inquiry about the likely course of future events and evidence of past events does not always provide certain guidance about the future. There may be many reasons why an injured plaintiff's past work history provides no assistance in deciding what that plaintiff has lost through diminution of future earning capacity. The student who is yet to enter the workforce is an obvious case of that kind. That student may have no history of paid work. Important as evidence of past events may be, that evidence is not determinative of an issue about loss of future earning capacity.[19]
[19]Ibid 143 [7]–[8] (citations omitted).
The applicant’s reliance upon Husher is misconceived. Husher was a case where the injured plaintiff’s tax returns were not a true measure of the earning capacity that had been lost because the plaintiff had been splitting the income he earned with his wife. As the Court observed in Husher, the net income the plaintiff in that case would have had at his disposal, and which was lost as a result of injury, was the total amount earned as a result of the work performed by him. Husher reaffirmed the proposition that it is the financial loss suffered as a result of the diminution of earning capacity for which damages may be recovered.
In his reasons, the judge carefully analysed the arguments of both parties. The judge’s reasons disclose that he well understood the principles upon which the assessment of the applicant’s earning capacity was to proceed, and that he was required to make an assessment of the economic consequences and financial loss that the applicant had suffered, and would suffer, as a result of her injury and loss of earning capacity. It was well open to the judge to rely upon the applicant’s tax returns as disclosing the financial consequences of the loss of earning capacity suffered by the applicant as a result of her injury. The complaint that the judge’s assessment of the applicant’s damages was contrary to the principles enunciated in Husher (or contrary to principle generally) is without foundation.
In assessing the applicant’s loss of earning capacity, the judge accepted that the applicant was earning $15,000 per annum at the time of injury. On the applicant’s tax returns (which the judge was entitled to rely upon), this was a favourable place to start so far as the applicant was concerned. The judge then, without there being any direct evidence, was prepared to assume in the applicant’s favour that her income would have gone up by three per cent per annum from 2004 until the time of trial. This was also an assumption that could only be described as favourable to the applicant.
So far as the applicant’s complaint about the judge not using figures derived from individual payroll records for particular weeks of the applicant’s employment that were engaged in prior to the applicant suffering injury is concerned, a number of points may be made. First, it should be noted that the figures relied upon by the applicant, contained in the payroll records, are gross figures and would in any event have to be reduced to take account of income tax.
Secondly, a snapshot of an individual week, without more, provides a very limited basis upon which one might then make an assessment of loss of earning capacity over all of the years of the balance of a particular individual’s working life. The fact that the applicant could in discrete individual weeks earn amounts that, if multiplied by 52, would have produced a net annual income greater than that disclosed in tax returns that showed the applicant’s income before she was injured cannot be determinative of the applicant’s claim.
Thirdly, while the applicant would invite us to rely on particular individual weeks that are favourable to her (for example, the week of 23 September 2004 where the applicant earned the $855 asserted to be a basis for calculating the applicant’s loss), equally one could look at weeks where considerably less was earned (for example, the previous week of 16 September where only $245.81, before tax, was earned).
So far as the concession, in the serious injury application, as to the figure for gross weekly earning capacity ‘had the injury not occurred’[20] that was conceded by the respondent on the serious injury application is concerned, it is to be remembered that the calculation of that figure was for the purpose set out in s 134AB(38)(e) of the Act, and that the figure conceded was not a calculation of the financial loss that the applicant would suffer as a result of her loss of earning capacity.[21] As this Court has said before, there is no necessary equivalence between amounts required to be calculated in accordance with s 134AB(38)(e) and (f) of the Act and an assessment of pecuniary loss damages at common law.[22] Moreover, it is difficult to assign any real significance to the concession made in the serious injury application because, as an examination of Judge Lawson’s reasons discloses, any amounts that may have been calculated or agreed in that application were of no moment once it was established that the applicant had a pre-existing working capacity that was totally eradicated by her injury.[23]
[20]Cf s 134AB(38)(f)(ii) of the Act.
[21]Cf Husher (1999) 197 CLR 138, 143 [7]–[8].
[22]See The Herald & Weekly Times Limited v Jessop [2014] VSCA 292 [30]–[36], [53]–[61].
[23]Serious Injury Reasons [203].
As to the period after trial, the judge calculated the applicant’s annual loss ($21,386) by taking the $15,000 per annum figure that he had concluded was the applicant’s loss of earning capacity as at October 2004 and increasing this by three per cent per annum over the 12 years between the date of injury and the date of judgment.[24] On the evidence, this was also a favourable approach so far as the applicant was concerned. Moreover, in making his assessment of pre-trial and post-trial loss of earning capacity, the judge made no significant discount for any vicissitudes, and little allowance for income tax. The assessment was performed on the basis that the applicant would earn greater amounts than her tax returns disclosed for the whole of the rest of her working life after she suffered injury. One could well imagine a different trial judge making significant discounts for vicissitudes having regard to the applicant’s pre-injury work history and the medical evidence. Nevertheless, no complaint is made by the respondent (and correctly so in our view) about these matters.
[24]Although in fact there were only 11 years and eight months between the date of injury and the date of judgment.
On the evidence, there was a live issue as to the age at which the applicant might have been expected to cease to exercise any earning capacity that she would have had but for suffering injury. The judge chose 55 years. He did so on the basis of the evidence given by Mrs Allford. We see no error in that approach. Moreover, it seems to us that the judge’s approach was further justified by the evidence given at trial as to the difficult nature of the work that the applicant was required to perform in her employment as a packer. Again, a different judge may have made a different judgment call, but we are unable to say that, on the evidence, the judge’s approach was erroneous.
The applicant submitted that it was a principle of law that, ‘in the absence of specific evidence’, loss of future earning capacity should be calculated to an age upon which a person is entitled by law to retire and receive an Australian pension. The applicant asserted that authority for this proposition was to be found in a judgment of Kirby P in the New South Wales Court of Appeal’s decision of Baldwin v Lisicic.[25] Baldwin, and Kirby P’s judgment in Baldwin, is, however, not authority for any such proposition.[26] In any case where a judge assessing future loss of earning capacity is required to determine at what age a particular plaintiff may have ceased to exercise his or her earning capacity, the question will be a question of fact to be determined upon the whole of the evidence.
[25][1993] NSWCA 18 (‘Baldwin’).
[26]But cf, with respect, the per incuriam statement of Patten AJ (albeit in a different context) in Goodman v Impact Hire Australia Pty Limited [2009] NSWSC 941 [9].
In the present case, and notwithstanding the force of the applicant’s argument, while it might have been open to the judge to have concluded that the applicant would have worked beyond the age of 55 years, the judge was not bound to do so. Moreover, had the judge decided in this case that the applicant’s working life would have gone beyond 55 years, one would conclude that a more significant allowance for negative vicissitudes would need to have been made, so as to provide an award of damages that was reasonable to both parties.
The judge’s reasons for judgment disclose a careful and considered approach to the assessment of the applicant’s loss of earning capacity. On the evidence given at trial, the assessments and judgments made by the judge were all reasonable, appropriate and within range. None of the applicant’s complaints in relation to the judge’s assessment of pecuniary loss damages have any real prospect of success. Leave to appeal in relation to grounds 1 and 2 must be refused.[27]
[27]Cf s 14C of the Supreme Court Act 1986.
Ground 3: interest
In her application for leave to appeal, the applicant asserts that interest should have been awarded in the sum of $257,785. This is the figure arrived at if one assumes in the applicant’s favour that past loss of earnings (after deduction of weekly payments)[28] should have assessed at $436,924, and then one applies an annual rate of interest of 10 per cent for 11.8 years and divides by two.
[28]See s 134AB(25) of the Act.
The applicant’s claimed figure for interest must be rejected. First, the time between injury and judgment in the County Court was only 11 years and 8 months. Secondly, the applicant’s past loss of earnings did not all accrue at the time of injury; they accrued gradually between the date of injury and the time of judgment. Thirdly, there is no basis for any award of interest in respect of the period between the date of injury and the commencement of the proceeding in the County Court. The applicant is only entitled to interest on her past pecuniary losses from the date of commencement of the County Court proceeding.[29]
[29]See Williams v Oataway (2005) 11 VR 529; Hardie v The Herald & Weekly Times Pty Ltd [No 2] [2016] VSCA 130; Starr v Greenfreight (Services) Pty Ltd [2016] VSCA 213.
In argument, Mr Sahin submitted on behalf of the applicant that junior counsel who appeared at trial for the respondent[30] conceded that interest was payable from the date the applicant suffered injury. We have examined the transcript of the argument before the judge concerning the issue of interest. The submission put by the applicant’s junior trial counsel is confusing. To the extent that it can be understood, the submission put by the respondent’s junior counsel at trial[31] was wrong in law. However, while we have some sympathy for the confusion that this submission has caused Mr Sahin, nothing that was said to the judge on behalf of the respondent now entitles the applicant to interest otherwise than in accordance with the relevant statutory provisions.[32]
[30]Not counsel who appeared in this Court.
[31]Again, not counsel who appeared in this Court.
[32]Section 60 of the Supreme Court Act 1986 and s 134AB(34) of the Act.
The respondent concedes that the judge’s calculation of interest was wrong. It submits that interest should have been calculated on the amount of past loss that had accrued as at the date of the commencement of the proceeding, from the commencement of the proceeding to the time of judgment, together with that part of the past loss that accrued on a weekly basis during the time when the County Court proceeding was on foot. Calculating interest at the prevailing penalty interest rates[33] on the amount that had accrued at the time the proceeding was commenced and on half the amount that accrued during the currency of the proceeding,[34] produces a figure for interest up until the date of judgment of $24,492.
[33]10.5 per cent per annum between 21 January 2015 and 31 May 2015, and 9.5 per cent per annum between 1 June 2015 and 24 June 2016.
[34]As to the appropriateness of which, see Dexter v Courtaulds Ltd [1984] 1 All ER 70.
There should be a grant of leave to appeal in respect of ground 3. The appeal should be allowed in respect of that ground, and it should be ordered that the applicant’s damages in the nature of interest up to and including 24 June 2016 are assessed at $24,492.
Conclusion
There will be a limited grant of leave to appeal for the purpose of correcting the judge’s calculation with respect to interest. The appeal will be allowed to substitute for the amount awarded for interest the sum of $24,492. The appeal will otherwise be dismissed.
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