Schuller v S J Webb Nominees Pty Ltd
[2015] SASCFC 162
•12 November 2015
Supreme Court of South Australia
(Full Court: Civil)
SCHULLER v S J WEBB NOMINEES PTY LTD
[2015] SASCFC 162
Judgment of The Full Court
(The Honourable Acting Chief Justice Gray, The Honourable Justice Stanley and The Honourable Justice Lovell)
12 November 2015
TORTS - NEGLIGENCE - ESSENTIALS OF ACTION FOR NEGLIGENCE - DUTY OF CARE - SPECIAL RELATIONSHIPS AND DUTIES - OCCUPIERS
TORTS - THE LAW OF TORTS GENERALLY - GENERAL PRINCIPLES - VOLENTI NON FIT INJURIA
DAMAGES - MEASURE AND REMOTENESS OF DAMAGES IN ACTIONS FOR TORT - MEASURE OF DAMAGES - PERSONAL INJURIES - GENERAL PRINCIPLES
The appellant, while inebriated, fell from a chair on which she was dancing at the Port Broughton Sunnyside Hotel-Motel, suffering serious injury to her right leg. The appellant sued the respondent, as proprietors of the hotel, in negligence and for breach of statutory duty, claiming damages for her injuries. The appellant alleged the respondent was at fault for selling her too much alcohol and for failing to prevent her from dancing on the chair. A Judge of the District Court dismissed her claim, holding that the respondent did not owe the appellant a duty of care and that there was no relevant causative breach of duty. Further, in any event, the judge held that the respondent had made out the defence of voluntary assumption of risk. The judge apportioned liability, in the event that he was wrong as to liability, against the appellant 90/10 and assessed the appellant’s total damages in the amount of $129,380 plus any applicable interest.
Whether the respondent owed the appellant a duty of care and breached that duty of care. Whether the defence of voluntary assumption of risk had been made out. Whether it was appropriate to make a reduction in damages of 90% on account of the appellant’s contributory negligence. Whether the Judge erred in his assessment of non-economic loss, future economic loss, past voluntary services and future care. Whether award of damages was manifestly inadequate.
Held per Stanley J dismissing the appeal (Gray and Lovell JJ agreeing):
1. The High Court in C.A.L No 14 Pty Ltd v Motor Accidents Insurance Board (2009) 239 CLR 390 has held that, outside of exceptional cases, persons in the position of the proprietor and the licensee, while bound by important statutory duties in relation to the service of alcohol and the conduct of the premises in which it is served, owe no general duty of care at common law to customers which requires them to monitor and minimise the service of alcohol or to protect customers from the consequences of the alcohol they choose to consume.
2. This was not an exceptional case. The common law did not impose upon the respondent a duty of care to protect the appellant from causing harm to herself by undertaking activities in a state of inebriation which exposed her to the risk of injury. The judge did not err in finding that no duty of care existed.
3. In any event, even if there was such a duty owed by the respondent to the appellant, the judge was correct in finding the respondent was not in breach of the duty. The respondent, through its officers, exercised the reasonable care it owed the appellant.
4. Pursuant to sections 36 and 37 of the Civil Liability Act 1936 (SA), in order to establish the defence of voluntary assumption of risk, the respondent was required to prove that the appellant consciously adverted to the possibility that the risk of falling from the chair might eventuate and decided to dance on the chair while affected by alcohol regardless. That finding was open to the judge on the evidence.
5. The judge fell into error by purporting to apportion liability without identifying in what way the respondent was negligent.
6. There was no error in the approach taken by the judge in assessing the award for non-economic loss. However, the damages assessed in respect of future economic loss, past voluntary services and future care were inadequate. If the respondent were liable, the amount of the damages assessed by the judge should be substituted with an award of $191,810.
Civil Liability Act 1936 (SA) s 3(1), s 36, s 37, s 58(3); Civil Liability Act 2002 (NSW) s 5F, s 5G, referred to.
C.A.L No 14 Pty Ltd v Motor Accidents Insurance Board (2009) 239 CLR 390, applied.
Freudenstein v Marhop Pty Ltd & Ors [2010] NSWSC 724; Rootes v Shelton (1967) 116 CLR 383, distinguished.
Fox v Percy (2003) 214 CLR 118; Cole v South Tweed Heads Rugby League Football Club Ltd (2004) 217 CLR 469; O’Connor v SP Bray Ltd (1937) 56 CLR 464; Byrne v Australian Airlines (1995) 185 CLR 410; Papps v Police (2000) 77 SASR 210; Keith v Gal [2013] NSWCA 339; Whisprun Pty Ltd v Dixon (2003) 77 ALR 1598; Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247; Roggenkamp v Bennett (1950) 80 CLR 292; Carey v Lake Macquarie City Council [2007] NSWCA 4; CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384; K-Generation Pty Ltd & Anor v Liquor Licensing Court & Anor (2009) 237 CLR 501; In Re an Appeal from Credit Tribunal by John Martin & Co Ltd (1974) 8 SASR 237; Thompson v Australian Capital Television Thompson (1994) 54 FCR 513; King v Philcox (2015) 89 ALJR 582; Carr v Western Australia (2007) 232 CLR 138; Packer v Cameron (1989) 54 SASR 246; National Insurance Co of New Zealand Ltd v Espagne (1961) 105 CLR 569; Burford v Steer (1984) 118 LSJS 139; Wade v Allsopp (1976) 10 ALR 353; Watts v Rake (1960) 108 CLR 158; Terry v Leventeris (2011) 109 SASR 358, considered.
SCHULLER v S J WEBB NOMINEES PTY LTD
[2015] SASCFC 162Full Court: Gray ACJ, Stanley and Lovell JJ
GRAY ACJ. I would dismiss the appeal. I agree with the reasons of Stanley J.
STANLEY J:
Introduction
In the early hours of 18 April 2009, the appellant, while inebriated, fell from a chair on which she was dancing at the Port Broughton Sunnyside Hotel-Motel. As a result she suffered serious injury to her right leg.
The appellant sued the proprietors of the hotel in negligence and for breach of statutory duty, claiming damages for her injuries. She alleged the hotel was at fault for selling her too much alcohol and for failing to prevent her from dancing on the chair.
A Judge of the District Court dismissed her claim, holding that the respondent did not owe the appellant a duty of care, that there was no relevant causative breach of duty and that her fall was solely her own fault. Further, in any event, the judge held the hotel had a good defence to her claim on the basis of her voluntary assumption of risk in dancing on the chair while affected by alcohol.
The judge proceeded to find that if the Court was wrong in finding the respondent not liable for the appellant’s injuries, her negligence contributed to her fall and apportioned liability against her 90/10.
Further, the judge proceeded to assess the appellant’s damages in the event that the Court was wrong on the issue of liability in an amount of $129,380 plus any applicable interest.
The appellant appeals both on liability and quantum.
The appellant’s evidence
The trial judge held serious reservations about the credibility and reliability of the appellant’s evidence. He concluded that, wherever the evidence of the appellant conflicted with the evidence of other witnesses in the case or medical records, the evidence of those other witnesses or records was to be preferred. This assessment is particularly significant to the damages appeal.
Judge’s findings of fact
The judge made the following findings of fact:[1]
On the evening in question the plaintiff went to the Port Broughton Sunnyside Hotel Motel at around 9pm.
The saloon bar area featured live music, and after the meal service concluded in the hotel at around that time, a musical duo was set up in the corner of the moderately sized saloon bar. The room was a standard, carpeted room that one might find in innumerable hotels. It had four or five square moderately sized tables with accompanying chairs. These had been or were moved to the sides of the room to clear an open space in front of the band to allow patrons to dance if they wanted to.
After the plaintiff arrived at the hotel, over the course of the next hour or two she purchased three schooners of beer. She spent a lot of her time outside in the beer garden with friends where she could also smoke. It is not clear whether she was bought any alcohol by others during the course of the evening. The plaintiff was on OxyContin for her back pain. That is a strong painkiller, which has the potential to have affect together with alcohol. For some reason, possibly others buying her drinks, possibly due to her medication in combination with alcohol, or possibly for some other reason, the plaintiff became more intoxicated than the number of beers she herself purchased would alone have been responsible for.
Over the course of the evening the plaintiff would periodically come in from the beer garden to listen to the band playing in the saloon bar, and would also dance to the music. At some point she got up on a chair to dance, and was immediately told by Mr Simpson the bar manager to get down, which she did.
Half to three quarters of an hour later she did it again. Mr Simpson saw her and immediately yelled at her to get down, intending to convey that he was starting to be annoyed at her behaviour, and went to approach where she was, however the plaintiff immediately got down from the chair before he arrived.
Mr Simpson took her aside to give her a ‘first and final warning’ about her conduct, intending to convey thereby that if she did it again she would be excluded from the hotel. While doing that he noticed that she was more intoxicated than he thought was appropriate so he determined to cease service of alcohol to her. To ensure this occurred he informed Mr Sheldon, the only other barman there at that stage. That in fact occurred, as the plaintiff later tried to purchase a further drink but was refused service by Mr Sheldon. Mr Sheldon offered the plaintiff water, which she refused, and she walked back out to the beer garden.
Later in the evening, between 12.00 and 12.30, the plaintiff was again in the saloon bar area listening to the band, and decided to get up on a chair again. The moment she did the barman Mr Sheldon approached her and told her to get down, and told her she was kicked out of the pub, but she ignored him, continued to dance, and moments later fell, injuring herself.
[1] Schuller v S J Webb Nominees P/L [2014] SADC 178 at [64] – [70].
Approach on appeal
The principles applicable to the approach to be taken by an appellate court on an appeal by way of rehearing in reviewing findings of fact are well settled. The position is definitively stated by the High Court in Fox v Percy.[2] Gleeson CJ, Gummow and Kirby JJ said:[3]
[2] [2003] HCA 22, (2003) 214 CLR 118.
[3] [2003] HCA 22 at [23], [25] - [29], [41], (2003) 214 CLR 118 at 125 – 128, 131 – 132.
On the one hand, the appellate court is obliged to “give the judgment which in its opinion ought to have been given in the first instance”. On the other, it must, of necessity, observe the “natural limitations” that exist in the case of any appellate court proceeding wholly or substantially on the record. These limitations include the disadvantage that the appellate court has when compared with the trial judge in respect of the evaluation of witnesses’ credibility and of the “feeling” of a case which an appellate court, reading the transcript, cannot always fully share. Furthermore, the appellate court does not typically get taken to, or read, all of the evidence taken at the trial. Commonly, the trial judge therefore has advantages that derive from the obligation at trial to receive and consider the entirety of the evidence and the opportunity, normally over a longer interval, to reflect upon that evidence and to draw conclusions from it, viewed as a whole.
…
Within the constraints marked out by the nature of the appellate process, the appellate court is obliged to conduct a real review of the trial and, in cases where the trial was conducted before a judge sitting alone, of that judge’s reasons. Appellate courts are not excused from the task of “weighing conflicting evidence and drawing [their] own inferences and conclusions, though [they] should always bear in mind that [they have] neither seen nor heard the witnesses, and should make due allowance in this respect”. In Warren v Coombes, the majority of this Court reiterated the rule that:
“[I]n general an appellate court is in as good a position as the trial judge to decide on the proper inference to be drawn from facts which are undisputed or which, having been disputed, are established by the findings of the trial judge. In deciding what is the proper inference to be drawn, the appellate court will give respect and weight to the conclusion of the trial judge but, once having reached its own conclusion, will not shrink from giving effect to it.”
As this Court there said, that approach was “not only sound in law, but beneficial in . . . operation”.
After Warren v Coombes, a series of cases was decided in which this Court reiterated its earlier statements concerning the need for appellate respect for the advantages of trial judges, and especially where their decisions might be affected by their impression about the credibility of witnesses whom the trial judge sees but the appellate court does not. Three important decisions in this regard were Jones v Hyde, Abalos v Australian Postal Commission and Devries v Australian National Railways Commission. This trilogy of cases did not constitute a departure from established doctrine. The decisions were simply a reminder of the limits under which appellate judges typically operate when compared with trial judges.
The continuing application of the corrective expressed in the trilogy of cases was not questioned in this appeal. The cases mentioned remain the instruction of this Court to appellate decision-making throughout Australia. However, that instruction did not, and could not, derogate from the obligation of courts of appeal, in accordance with legislation such as the Supreme Court Act applicable in this case, to perform the appellate function as established by Parliament. Such courts must conduct the appeal by way of rehearing. If, making proper allowance for the advantages of the trial judge, they conclude that an error has been shown, they are authorised, and obliged, to discharge their appellate duties in accordance with the statute.
Over more than a century, this Court, and courts like it, have given instruction on how to resolve the dichotomy between the foregoing appellate obligations and appellate restraint. From time to time, by reference to considerations particular to each case, different emphasis appears in such reasons. However, the mere fact that a trial judge necessarily reached a conclusion favouring the witnesses of one party over those of another does not, and cannot, prevent the performance by a court of appeal of the functions imposed on it by statute. In particular cases incontrovertible facts or uncontested testimony will demonstrate that the trial judge’s conclusions are erroneous, even when they appear to be, or are stated to be, based on credibility findings.
That this is so is demonstrated in several recent decisions of this Court. In some, quite rare, cases, although the facts fall short of being “incontrovertible”, an appellate conclusion may be reached that the decision at trial is “glaringly improbable” or “contrary to compelling inferences” in the case. In such circumstances, the appellate court is not relieved of its statutory functions by the fact that the trial judge has, expressly or implicitly, reached a conclusion influenced by an opinion concerning the credibility of witnesses. In such a case, making all due allowances for the advantages available to the trial judge, the appellate court must “not shrink from giving effect to” its own conclusion.
…
... The appellant had to rely before this Court on the advantages that the primary judge enjoyed in seeing the parties, and Mr Murdoch, give their evidence and in preferring the evidence of the appellant and Mr Murdoch to that of the respondent. The Court of Appeal was bound to make due allowance (as it did) for such advantages. The trial judge sat through four days of trial before giving his decision. He did so at a time when the impression made by the witnesses was still clearly in his mind. The Court of Appeal was bound to afford respect to the endeavour of the judge to give the correct and lawful conclusion to the puzzle presented to him. Clearly, the Court of Appeal was right to reject the respondent’s belated suggestion of bias, which should not, in our view, have been made. No doubt, the Court of Appeal also took into account the unexpressed considerations that went into the judge’s conclusion. No judicial reasons can ever state all of the pertinent factors; nor can they express every feature of the evidence that causes a decision-maker to prefer one factual conclusion over another.
(Citations omitted).
The issues raised by the parties on appeal involve questions of law and inferences to be drawn from the facts as found by the judge. This Court is in as good a position as the judge to determine those issues. I have undertaken my own review of the evidence and formed my own view in relation to those issues in the context where I recognise the advantage available to the trial judge in his assessment of the credibility and reliability of the witnesses. Accordingly, I have approached the exercise of the appellate function conscious of that advantage and giving due respect to the judge’s assessment of the evidence of each of the witnesses, including, in particular, the appellant. I have reviewed the evidence to determine whether any finding the subject of challenge is inconsistent with uncontested testimony or incontrovertible facts, glaringly improbable or contrary to compelling inferences, and whether there is a basis or reason to disturb the judge’s findings in this respect. But as the appellant makes clear, what is mostly challenged on the appeal are the conclusions reached by the judge on the evidence that he accepted.
The appellant’s case on liability
The appellant contends:
1.The respondent owed her a duty to take reasonable care for her safety while on the hotel premises. That duty extended beyond the static nature of the premises to the activities within the premises;
2.In the circumstances where the respondent had knowledge that the appellant had previously danced on a chair in the hotel on two occasions that night, and that she was inebriated, the respondent breached the duty by not requiring her to get down from the chair and in failing to assist her to do so, given her state of inebriation;
3.Having regard to her inebriation, the respondent did not prove that she freely and voluntarily agreed to accept the risk of dancing on a chair while inebriated on the last occasion she climbed onto the chair to dance, such that the defence of voluntary assumption of risk was not made out; and
4.The damages should be reduced, on account of contributory negligence, but that the trial judge’s reduction by 90 per cent was manifestly excessive.
Did the respondent owe the appellant a duty of care?
The judge’s conclusion that the respondent did not owe the appellant a duty of care to prevent her from injuring herself by falling from the chair while she was drunk relied upon the judgment of the High Court in C.A.L No 14 Pty Ltd v Motor Accidents Insurance Board[4] (CAL). On the appeal the appellant contends that the judge misapplied CAL. The appellant submits that CAL supports a finding that the respondent owed her a duty that extended beyond the static nature of the premises to activities within the hotel premises. She submits that, in the circumstances where the hotel management knew her to be inebriated and knew she was dancing on a chair, the respondent was in breach of its duty of care by not requiring her to descend from the chair and in failing to assist her to do so prior to the fall. Accordingly, it is necessary to consider the decision of the High Court in CAL.
[4] [2009] HCA 49, (2009) 239 CLR 390.
In CAL, a man who had been drinking in a hotel was killed when riding a motorcycle from the hotel to his home. The accident resulted from the effects of alcohol. The deceased had been drinking at the hotel for about three hours. Shortly before the deceased left the hotel, the licensee suggested to him that he had had enough and that it was time for him to go. The licensee asked the deceased for his wife’s telephone number so that she could be contacted to come and get him. The deceased, in abusive language, refused to give the number. He demanded that he be given the motorcycle. He had previously agreed that the motorcycle should be locked in a store room at the hotel when it was rumoured that the police were operating a breathalyser or speed camera in the vicinity of his home. The licensee asked him whether he was right to ride and he said that he was.
The High Court allowed an appeal from a majority judgment of the Full Court of the Supreme Court of Tasmania which found the proprietor and licensee of the hotel liable for the man’s death because they had breached a duty to take reasonable care to prevent the deceased from riding the motorcycle while so affected by alcohol as to have a reduced capacity to ride it safely.
Gummow, Heydon and Crennan JJ[5] recognised that the proprietor and licensee owed the deceased various duties to take reasonable care, including to ensure that the premises were physically safe and that equipment in operation, like gambling machines and kegs, did not injure him.[6] They said that outside of exceptional cases, which this was not, persons in the position of the proprietor and the licensee, while bound by important statutory duties in relation to the service of alcohol and the conduct of the premises in which it is served, owe no general duty of care at common law to customers which requires them to monitor and minimise the service of alcohol or to protect customers from the consequences of the alcohol they choose to consume. They said that conclusion was correct because the opposite view would create enormous difficulties relating to legal coherence and the autonomy of the individual hotel patron.[7] They considered what circumstances might constitute an exceptional case. They identified examples where the circumstances might justify the existence of a duty of care on the part of publicans to their customers in relation to the consequences of serving alcohol, such as where a person is so intoxicated as to be completely incapable of any rational judgment or of looking after himself or herself, and the intoxication results from alcohol knowingly supplied by the publican to that person for consumption on the premises.[8]
[5] French CJ and Hayne J agreeing.
[6] [2009] HCA 49 at [31], (2009) 239 CLR 390 at 404.
[7] [2009] HCA 49 at [52], (2009) 239 CLR 390 at 413.
[8] [2009] HCA 49 at [44], (2009) 239 CLR 390 at 410.
The High Court in CAL referred to the Canadian position which has found the existence of a duty of care on the part of publicans to patrons who have become intoxicated by the consumption of alcoholic beverages supplied by the publican. Such a duty was limited to circumstances where the publican had knowledge of the patron, for example his propensity for irresponsible behaviour when under the influence, and the patron’s condition. The High Court distinguished the principal Canadian authority and disapproved of Australian authorities which have adopted or appeared to have adopted the Canadian approach. The High Court expressly held that those authorities should not be followed.
The appellant’s case is that CAL is no impediment to the existence of a duty of care owed by the respondent to the appellant to take action to prevent her from injuring herself by falling from the chair she was dancing on while inebriated. In the alternative she submits that, if the general principle for which CAL stands does preclude the existence of a duty of care, the appellant’s circumstances fall within the exception to that principle identified by the High Court in CAL.
If exceptional circumstances are found to exist, those circumstances broaden the scope of the duty owed by publicans to their patrons in relation to the consequences of serving alcohol.[9] In those circumstances, publicans will owe a duty of care to patrons which requires them to monitor and minimise the service of alcohol or to protect patrons from the consequences of the alcohol they choose to consume.
[9] Cole v South Tweed Heads Rugby League Football Club Ltd [2004] HCA 29 at [14] and [131], (2004) 217 CLR 469 at 477 and 507.
The submission that CAL is not authority for the proposition that the duty of care owed by the licensee of a hotel to its patrons is limited to the static nature of the premises relies upon an observation made in Freudenstein v Marhop Pty Ltd & Ors.[10]In Freudenstein, Kirby J held that the duty owed to hotel patrons to take reasonable care to ensure that premises are physically safe, and that equipment in operation does not injure them, is not limited to the static nature of the premises.[11] That observation by Kirby J must be regarded as obiter. The duty to take reasonable care for the safety of Mr Freudenstein, found to exist by Kirby J, was a duty to protect him from the risk of injury posed by the static nature of the premises where renovations were undertaken. In any event, Kirby J acknowledged that the hotel did not owe Mr Freudenstein a duty to monitor and minimise the service of alcohol to him as a customer in order to protect him from the consequences of the alcohol he chose to consume, unless his circumstances were exceptional in the sense discussed in CAL.[12] The judgment in Freudenstein does not qualify the principle for which CAL stands or extend the duty owed by publicans to inebriated patrons beyond the static conditions of hotel premises unless it is established that it is an exceptional case.
[10] [2010] NSWSC 724.
[11] [2010] NSWSC 724 at [92].
[12] [2010] NSWSC 724 at [95].
The appellant submits that this is an exceptional case such that a duty of care exists because:
1.the respondent knew about the appellant’s intoxication, and resulting vulnerability and lack of autonomy;
2.the respondent knew about the appellant’s propensity to dance on chairs at the hotel;
3.dancing on chairs at the hotel was dangerous and unsafe, particularly when the person concerned was intoxicated;
4.the respondent had the power to control the conduct of the appellant, and the performance of the activity, while on the premises; and
5.the power to prevent the activity did not involve a lack of coherence with other torts, laws or legislative regimes in relation to alcohol.
I do not accept that submission.
These factors do not make the appellant’s case exceptional in the sense discussed by the plurality in CAL. Underlying the exceptional case is the notion of a patron so intoxicated by reason of alcohol supplied by a publican, for consumption on the hotel premises, that the patron is completely incapable of any rational judgment or of looking after himself or herself. In my view, that connotes a level or degree of intoxication greater than the case of the appellant. The evidence demonstrated that she was capable of getting up on the chair and of dancing. She could not be characterised as being completely incapable of looking after herself. I do not accept that the evidence establishes she lacked autonomy. While the evidence establishes, and the judge found, that the appellant was intoxicated, intoxication is a question of degree. The evidence does not establish, and the judge did not find, that she was so drunk as to be incapable of rational judgment or of looking after herself. The fact that she was observed to repeatedly dance on a chair that night does not take the matter any further. It is not evidence of a complete incapacity for rational judgment or for looking after herself. It is merely evidence of an error of judgment. That is not the same thing. Neither does the fact that the respondent was empowered to take action to control the conduct of patrons a sufficient basis to bring the appellant’s case into the exceptional category in CAL. The plurality in CAL clearly understood that publicans are conferred with specific power to refuse service and to eject patrons who appear intoxicated. Their Honours did not identify this as a basis upon which to broaden the scope of the duty of care publicans otherwise owe patrons. Finally, this case is not brought into the exceptional category through the submission that the power the respondent had to prevent the appellant dancing on the chair while intoxicated does not involve a lack of coherence with other laws. That the publican enjoyed the right to direct the appellant to get down from the chair, and the power to eject her from the premises if she failed to comply with such direction, does not lead to the conclusion that the existence of such right and power gives rise to a duty of care to the appellant to exercise such right and power to protect her from the risk of injury because of the alcohol she had chosen to consume. It has long been the case that the existence of a particular statutory duty which applies to a defendant does not necessarily give rise to a private right of action on the part of a plaintiff. A cause of action for damages for breach of statutory duty arises where a statute which imposes an obligation for the protection or benefit of a particular class of persons is, upon its proper construction, intended to provide a ground of civil liability when the breach of the obligation causes injury or damage of a kind against which the statute was intended to afford protection.[13] The conferral of power on publicans to eject intoxicated or unruly patrons from hotels is not a power conferred to protect that person from risk of injury or damage. It is to protect others from that patron. On the contrary, the general principle for which CAL stands as authority speaks against making the existence of such right or power a basis for creating an exception to the general principle. While the categories of exceptions to the general principle are not closed by the reasons of the plurality, they point to the exception being based in factors particular to the plaintiff, not the defendant.
[13] O’Connor v SP Bray Ltd [1937] HCA 18, (1937) 56 CLR 464 at 477 – 478; Byrne v Australian Airlines [1995] HCA 24 at [16], (1995) 185 CLR 410 at 424.
The common law did not impose upon the respondent a duty of care to protect the appellant from causing harm to herself through undertaking activities in a state of inebriation which exposed her to the risk of injury by falling from a chair on which she was dancing. The judge did not err in finding that no duty of care existed.
Adequacy of reasons
The appellant further complains that the reasons of the judge do not adequately explain why he did not find the respondent owed her a duty of care to protect her from the risk of injuring herself from dancing on the chair while inebriated. I reject this submission.
The failure to give adequate reasons is an error of law.[14] The extent and content of the reasons required depends on the particular case under consideration and the matters in issue.[15] A judge’s reasons are not required to mention every fact or argument relied upon by the losing party relevant to an issue.[16] It will ordinarily be sufficient if the reasons apprise the parties of the broad outline and constituent facts of the reasoning on which the judge has acted.[17]
[14] Papps v Police [2000] SASC 183 at [33], (2000) 77 SASR 210 at 218.
[15] Keith v Gal [2013] NSWCA 339 per Gleeson JA at [110].
[16] Whisprun Pty Ltd v Dixon [2003] HCA 48 at [62], (2003) 77 ALR 1598 at 1610.
[17] Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247 at 273.
The judge explained his reasons for finding that no duty of care existed in the following terms:[18]
Further, it must be understood that after some uncertainty in recent years, a recent High Court case established that unless there are exceptional circumstances, there is no general duty of care at common law to customers to monitor and minimise the service of alcohol or to protect customers from the consequences of the alcohol they choose to consume. In simple terms, hotels are not legally liable to compensate people who get drunk and hurt themselves on hotel premises.
Hotels still have important legal obligations concerning the responsible service of alcohol and to conduct and maintain their premises in a safe way, however they are not liable to pay damages to a person who drinks too much and who, as a consequence of their own actions while drunk, injures them self.
Therefore, unless there are exceptional circumstances, or the hotel fails to conduct and maintain its premises in a safe manner and condition and for that reason the plaintiff is injured, a plaintiff who injures themselves by behaving stupidly while drunk cannot recover damages.
In this case, the plaintiff injured herself by dancing on a chair while drunk, and has not established any exceptional circumstances or that the hotel failed to maintain and conduct its premises in a safe manner and condition. Hence her claim cannot succeed, and is dismissed.
(Citations omitted).
[18] [2014] SADC 178 at [8] – [11]
The judge gave more detailed reasons for these conclusions in these terms:[19]
As discussed earlier, in layman’s terms the plaintiff can only succeed against the defendant if she can prove that she was injured because the hotel failed to maintain and conduct its premises in a safe manner and condition, or that there were exceptional circumstances relating to her inebriation such that the clear legal principle that a plaintiff who injures themselves by behaving stupidly while drunk cannot recover damages, should not apply.
I find that there was nothing unsafe about the hotel premises on the night in question. The saloon bar was a saloon bar like innumerable others. It was a perfectly safe room with the ordinary tables and chairs you might expect in such a room. The chairs and tables were in good condition. There was nothing unsafe about having a band in the corner and clearing away an area in front of the band to allow patrons to dance. The floor was flat, carpeted, and in apparently good condition. When the band was set up, the tables were moved to the sides of the room, were plainly visible, and posed no material danger to anyone. It was a scene you might see in any country pub on any given weekend, anywhere in Australia. It was perfectly safe.
The actions of the bar staff that evening were also reasonable, adequate, safe and not in breach of any applicable duties. The plaintiff was only served three or four drinks. When she got up on a chair she was immediately told to get down, and complied. When that inappropriate conduct of getting up on a chair was first repeated she was warned and also cut off from alcohol service. She ignored that warning and did it again, at which time she was told to get down and told she was excluded from the pub, but she ignored the warning and fell.
There was nothing unsafe about the way the hotel was conducted that evening by its staff.
The plaintiff was entirely responsible for her accident and her injuries. She did what she did despite repeated warnings from the hotel not to do so.
The plaintiff’s conduct was a direct result of her making a stupid decision to behave the way she did while inebriated, in what were objectively safe premises being run competently by the defendant. There were plainly no exceptional circumstances in this case, within the legal meaning of that phrase.
(Citation omitted).
[19] [2014] SADC 178 at [71] – [76].
In my view, the judge adequately explained the facts relied upon and the reasons for rejecting the existence of a duty of care either on the basis of the general principle in CAL or the recognised exception to that principle.
These conclusions in relation to the absence of a relevant duty of care and the adequacy of the judge’s reasons for so finding are sufficient to dispose of the appeal. Nonetheless, in case this matter goes further, I shall address the remaining issues on liability and the appeal against damages.
Breach of duty?
In any event, even if there was such a duty owed by the respondent to the appellant, the judge was correct in finding the respondent was not in breach of the duty. Such duty is to exercise reasonable care to protect patrons from the consequences of the alcohol they have consumed. The respondent did so. The respondent, through its officers Mr Simpson and Mr Sheldon, repeatedly directed the appellant to get off the chair when she was observed dancing on the chair. On the first and second occasions she did so. After the second occasion, it ceased to serve her alcohol and warned her that any repetition of her behaviour would result in her ejection from the hotel. On the final occasion, when she failed to respond to Mr Sheldon’s direction that she come down from the chair, he immediately sought out Mr Simpson, who was the employee of the hotel authorised to eject her from the premises and to use such reasonable physical force as was necessary to do so. Before this could occur the appellant fell off the chair and suffered injury. By the conduct of Mr Simpson and Mr Sheldon, the respondent exercised the reasonable care it owed the appellant. I reject the submission that the respondent, in order to discharge its duty of care, was obliged to stop the music or remove the chairs from the saloon bar. That was not reasonable. I also reject the submission that the respondent breached its duty by failing to monitor or supervise the appellant more closely. As a matter of fact, it did. Mr Sheldon maintained a sufficient observation of the appellant. He noticed that contrary to the instruction twice given by management, she was dancing on a chair again. The appellant’s fall occurred very shortly after she failed to respond to the last direction from Mr Sheldon to get down from the chair.
Voluntary assumption of risk
The judge found that, in any event, the respondent had made out the defence of voluntary assumption of risk. He said:[20]
There was an obvious risk in the plaintiff doing what she did after drinking, which I find was obvious to her at the time and was made even more obvious to her on the night in question by the repeated warnings she received from Mr Simpson when she got up the first two times and also from Mr Sheldon when she got up onto the chair a third time.
Any reasonable person in the plaintiff’s position would have taken the obvious step to avoid the risk of not dancing on the chair while inebriated. I find that she simply decided to knowingly take the obvious risk because she was enjoying the latter part of the evening and the music so much.
(Citation omitted).
[20] [2014] SADC 178 at [79] – [80].
The judge further explained this finding in a footnote in the following terms:[21]
See sections 36 and 37 of the Civil Liability Act. The court does not accept the plaintiff’s evidence that she gave no thought to the risk at the time. She was being repeatedly warned and on balance the court finds that she heard the warnings but consciously decided to take the risk.
[21] [2014] SADC 178 at footnote 16.
The respondent submits that the judge erred in finding that the respondent had established the defence of voluntary assumption of risk. She submits that the defence fell to be considered by reference to sections 36 and 37 of the Civil Liability Act 1936 (SA). They provide:
36—Meaning of obvious risk
(1) For the purposes of this Division, an obvious risk to a person who suffers harm is a risk that, in the circumstances, would have been obvious to a reasonable person in the position of that person.
(2) Obvious risks include risks that are patent or matters of common knowledge.
(3) A risk may be obvious even though it is of low probability.
37—Injured persons presumed to be aware of obvious risks
(1) If, in an action for damages for negligence, a defence of voluntary assumption of risk (volenti non fit injuria) is raised by the defendant and the risk is an obvious risk, the plaintiff is taken to have been aware of the risk unless the plaintiff proves, on the balance of probabilities, that he or she was not actually aware of the risk.
(2) For the purposes of this section, a person is aware of a risk if the person is aware of the type or kind of risk, even if the person is not aware of the precise nature, extent or manner of occurrence of the risk.
(3) However, in order to establish a defence of voluntary assumption of risk, it is necessary to establish that the risk was such that a reasonable person in the plaintiff’s position would have taken steps (which the plaintiff did not in fact take) to avoid it.
These provisions modify the common law position which required that, in order to establish the defence, the defendant prove:[22]
1.that the plaintiff perceived the existence of a danger;
2.that he or she fully appreciated it; and
3.that he or she freely and voluntarily agreed to accept the risk.
[22] Roggenkamp v Bennett [1950] HCA 23 at [11], (1950) 80 CLR 292 at 300; Carey v Lake Macquarie City Council [2007] NSWCA 4 at [85].
I should make clear at this point that I do not accept the submission put by the respondent that the common law did not always require proof that the plaintiff freely and voluntarily agreed to accept the risk in order to establish the defence of volenti non fit injuria. That submission relied upon the High Court’s judgment in Rootes v Shelton.[23] This submission misunderstands the decision in Rootes v Shelton. Rootes v Shelton concerned an appeal from the dismissal of a claim for damages for personal injury suffered by a plaintiff who was water skiing and collided with a stationary boat whilst skiing on a river. The New South Wales Court of Appeal had reversed the verdict of a jury in favour of the plaintiff on the ground that the defendant, as the driver of the speedboat, owed no relevant duty of care to the plaintiff as he had accepted the risk of injury involved in participating in that sport. The High Court allowed the appeal and reinstated the jury’s verdict. There were four substantial judgments delivered by the High Court. The reasoning of the High Court really focussed on the existence and content of the duty of care where a plaintiff engages in a sport or pastime involving inherent risk of injury. The reasons of each individual judge accept that it was for the jury to make its own assessment of what were the inherent risks in water skiing but that a finding such risks existed did not eliminate the existence of a duty of care on the part of the pilot of the speedboat, in the particular circumstances of this case, to avoid driving too close to an obvious obstacle in the water. A close reading of each set of reasons does not support the respondent’s submission that establishment of the defence did not require proof that the plaintiff adverted his mind to the risk of suffering injury and voluntarily accepted the risk.
[23] [1967] HCA 39, (1967) 116 CLR 383.
The appellant submits that the provisions of the Civil Liability Act nonetheless leave extant the common law obligation on a defendant who seeks to invoke the defence of volenti to prove that he or she voluntarily accepted the risk. The appellant submits that the concepts of awareness of risk and acceptance of it are separate and distinguishable. The statutory presumption of awareness of an obvious risk, created by s 37, does not relieve a defendant from the obligation to prove that the plaintiff, who is presumed to be aware of the risk, nonetheless voluntarily agreed to accept the risk.
The appellant submits that the question is not simply whether she freely and voluntarily decided to embark on a course of conduct that involved the risk of which she was aware. She submits the respondent was required to prove, in order to make good the defence, that she had consciously adverted to the possibility that the known risk of falling from the chair might eventuate and decided to dance on the chair while inebriated regardless of that risk. The appellant submits the respondent failed to prove this element of the defence.
The respondent submits that the operation of s 37(3) abrogates the need to prove that element of the defence. It submits that the existence of s 37(3) is inconsistent with the necessity to prove a conscious decision to assume the risk in order to establish the defence. It submits that once s 37(1) is satisfied, all that is required to be proven is that a reasonable person in the appellant’s position would have taken steps, not taken by the appellant, to avoid the risk. The respondent submits that the risk of falling from the chair was an obvious risk within the meaning of s 36. A reasonable person in the position of the appellant would have been aware of the risk of falling from a chair if dancing on it while drunk. As the appellant has not proved that she was not actually aware of the risk, she is taken to have been aware of the risk pursuant to s 37(1). As there can be no doubt that a reasonable person in the appellant’s position would have avoided the risk by not getting up on the chair to dance, the respondent submits that the defence of voluntary assumption of risk is made out pursuant to s 37(3). In any event, the judge found inferentially that the appellant consciously decided to take the risk of falling from the chair when she climbed on it.
In this case, whether the judge’s conclusion that the defence of voluntary assumption of risk is established is correct depends on whether sections 36 and 37 abrogate the need to prove that the appellant voluntarily assumed the risk. There was no real issue that the risk of injury from falling while dancing on a chair when drunk is an obvious risk. The statutory presumption that the appellant was aware of the risk was not displaced.
Whether the respondent made out the defence turns, at least in part, on the proper construction of sections 36 and 37. If the appellant’s construction is correct, the respondent had to prove that the appellant had consciously adverted her mind to the risk and voluntarily assumed it. If the respondent’s construction is correct, proof of that matter is unnecessary.
Legislation is to be construed by reference to the ordinary and grammatical sense of the text of the statute having regard to its context and legislative purpose. The context includes “the existing state of the law and the mischief which, by legitimate means … one may discern the statute was intended to remedy”.[24]
[24] CIC Insurance Ltd v Bankstown Football Club Ltd [1997] HCA 2, (1997) 187 CLR 384 at 408.
Sections 36 and 37 are not easy to construe. Section 37(1), when read in conjunction with s 36, creates a rebuttable presumption of awareness of a risk on the part of a person who suffers harm where the risk would have been obvious to a reasonable person in the position of the plaintiff. A plaintiff cannot rebut the presumption by claiming that, even though he or she was aware of the general risk of harm, he or she was not aware of all its possible manifestations, including the one that eventuated. This is the construction given to the equivalent provisions in New South Wales, namely, sections 5F and 5G of the Civil Liability Act 2002 (NSW).[25] However, the New South Wales legislation has no equivalent provision to s 37(3) of the Civil Liability Act.
[25] Carey v Lake Macquarie City Council [2007] NSWCA 4 at [90].
Sections 36 and 37 were introduced into the Civil Liability Act as part of a package of amendments intended to implement the recommendations of the Ipp Committee Report. The Ipp Committee was established to report on comprehensive reforms to the law of negligence designed to reduce the cost of injury claims and thereby the cost of insurance. The Ipp Committee Report addressed what was identified at the time as a crisis in the cost and availability of insurance. The Ipp Committee’s recommendations were adopted to a greater or lesser degree by legislatures throughout the Commonwealth. It is clear from an analysis of comparable provisions, however, that the amendments enacted by various State and Territory legislatures were not uniform.
The provisions which became sections 36 and 37 of the Civil Liability Act were the subject of recommendation 32 of the Ipp Committee Report. The Committee explained the rationale for this recommendation in the following terms:[26]
8.28As noted in 8.23, the defence of assumption of risk has become more or less defunct since the introduction of apportionment for contributory negligence. Three techniques have been used to this end: first, courts are very unwilling to hold that the plaintiff actually knew of the risk. In order to establish the defence of assumption of risk, it is not enough that the plaintiff ought to have known of the risk. The plaintiff must actually have been aware of the risk. Secondly, courts are unwilling to hold that the plaintiff freely and voluntarily accepted the risk. This is the main reason why the defence has long been effectively unavailable in relation to work risks. Because most decisions to take risks are made subject to some external pressure or influence, it is usually possible to attribute to such pressure the effect of rendering the decision non-voluntary. Thirdly, in this context, courts tend to define risks narrowly and at a relatively high level of detail. The more narrowly a risk is defined, the less likely it is that a person will have been aware of it. For instance, a person may be aware of the risk of suffering bodily injury as a result of engaging in a particular activity. But the person may not be aware of the risk of suffering bodily injury in a particular way.
8.29Making it easier to establish the defence of assumption of risk would obviously promote objectives underlying the Terms of Reference, and it would do so more directly than the proposal contained in Recommendation 31. The Panel’s opinion is that there are two ways in which the law could be changed that might encourage greater use by courts of the defence of assumption of risk.
8.30The first would be to reverse the burden of proof on the issue of awareness of risk in relation to obvious risks as defined in Recommendation 12. This could be done by a provision to the effect that for the purposes of the defence of assumption of risk, it would be presumed that the person against whom the defence is pleaded was actually aware of an obvious risk unless that person could prove, on the balance of probabilities, that he or she was actually not aware of the risk.
8.31The second possible change would be to provide that for the purposes of the defence of assumption of risk, the test of whether a person was aware of a risk is whether he or she was aware of a risk of the type or kind of risk and not of its precise nature, extent or manner of occurrence.
8.32The Panel recommends provisions embodying these principles. We would not recommend any provision dealing with the issue of voluntariness. Whether or not a risk was taken voluntarily is ultimately an evaluative question about which it would be difficult to make general provision.
[26] Commonwealth, Review of the Law of Negligence, Final Report (Ipp Committee Report) (2002) [8.28] – [8.32].
The court can have regard to extrinsic materials such as Second Reading Speeches and reports of executive committees for the purpose of determining the mischief to which an Act is directed or to identify the purpose of a statutory provision.[27]
[27] K-Generation Pty Ltd & Anor v Liquor Licensing Court & Anor [2009] HCA 4 at [51], (2009) 237 CLR 501 at 521; In Re an Appeal from Credit Tribunal by John Martin & Co Ltd (1974) 8 SASR 237 at 241.
Section 37(3) of the Civil Liability Act was not the subject of a recommendation by the Ipp Committee. It is a provision inserted into the statute by the Parliament of South Australia.
The Second Reading Speech does not provide any explanation as to the purpose for the enactment of s 37(3).
In my view, s 37(3) must be construed in the context of the work to be performed by the rest of the section and the mischief to which s 37, and its analogue s 36, is directed to rectify. The plain intention of these provisions is to make it easier for a defendant to establish the defence of voluntary assumption of risk to a claim in negligence. It does this in two ways. First, where a risk is obvious, the plaintiff will be presumed to have known of it. That is, the defendant does not need to prove that the plaintiff actually knew, only that the risk was obvious. It is, however, open to the plaintiff to show that, even though the risk was obvious, he or she did not in fact know of it. Second, s 37(2) provides that it is not necessary to show that the plaintiff knew of the exact nature or manner of occurrence of the risk. It is enough to show that he or she knew of the type or kind of risk or, alternatively, that a risk of this type or kind was obvious.
The provisions are intended to overcome some of the obstacles the common law erected to the success of the defence. One obstacle was that courts were unwilling to find that a plaintiff actually knew about the risk so as to assume it. Another was that courts tended to define risks narrowly and at a high level of detail, and so required the defendant to prove that the plaintiff knew not only of the risk of bodily injury from the activity, but also of the risk of suffering injury in a particular way.
The Ipp Committee expressly did not recommend any provision dealing with the issue of voluntariness. The respondent submits that the Parliament of South Australia nonetheless chose to do so by enacting s 37(3). I do not accept that submission. If it was the intention of the Parliament to relieve the defendant of the burden of having to prove that a plaintiff consciously adverted to the possibility that the known risk might eventuate and nonetheless decided to embark upon a course of conduct that involved that risk, of which he or she was aware, I would have expected the Parliament to have said so expressly and directly, not obliquely and by the side wind of s 37(3). As was said in Thompson v Australian Capital Television Thompson by Burchett and Ryan JJ:[28]
Statutory reforms removing a particular plank from the edifice of the common law do not necessarily bring down whole sections of the structure just because a rule expressly changed or abolished had an historical or a logical connection with other rules of the common law. To forbid such a consequence the rule has been established (and should be adhered to: Corporate Affairs Commission (NSW) v Yuill) that Acts altering the common law should be construed as doing so only so far as is necessary to give effect to their provisions.
(Citation omitted).
[28] [1994] FCA 1042, (1994) 54 FCR 513 at 526.
In my view, s 37(3) is properly to be understood as a protection to the plaintiff from the consequences of the statutory fiction that is created in the preceding subsections. It imposes an obligation on the defendant to prove that the risk was such that a reasonable person in the plaintiff’s position would have taken steps (which the plaintiff did not in fact take) to avoid the risk in order to establish the defence.
This construction is not an example of impermissibly giving the section an artificially narrow operation,[29] but rather is an example of the point made in Carr v Western Australia,[30] where Gleeson CJ observed that to construe legislation in a manner that promotes its purpose or object may be of little assistance where a statutory provision strikes a balance between competing interests and the problem is one of doubt about the extent to which legislation pursues a particular purpose.[31] Legislation rarely pursues a single purpose at all costs.
[29] King v Philcox [2015] HCA 19 at [42], (2015) 89 ALJR 582 at 594.
[30] [2007] HCA 47, (2007) 232 CLR 138.
[31] [2007] HCA 47, (2007) 232 CLR 138 at 143.
Accordingly, I consider that the appellant’s submission is correct. In order to establish the defence, the respondent was required to prove that the appellant consciously adverted to the possibility that the risk of falling from the chair might eventuate and decided to dance on the chair while affected by alcohol regardless. However, as McClellan CJ at CL noted in Carey v Lake Macquarie City Council,[32] while it is not enough to establish the defence that the plaintiff knows of the physical facts or circumstances that constitute the risk and exposes herself to them, proof of this will, in many cases, be sufficient to support an inference that the plaintiff voluntarily assumed the risk. To similar effect is the observation of McTiernan and Williams JJ in Roggenkamp v Bennett:[33]
The question whether the plaintiff’s acceptance of the risk was voluntary is generally a question of fact, and the answer to it may be inferred from his conduct in the circumstances. The inference may more readily be drawn in cases where it is proved that the plaintiff knew of the danger and comprehended it, as, for example, where the danger was apparent, or proper warning was given of it, and there was nothing to show that he was obliged to incur it, than in cases where he had knowledge that there was danger but not full comprehension of its extent, or where, while taking an ordinary and reasonable course, he had not an adequate opportunity of electing whether he would accept the risk or not.” (at p300)
[32] [2007] NSWCA 4 at [107].
[33] [1950] HCA 23 at [11], (1950) 80 CLR 292 at 300.
That is what the judge found in this case. That finding was open on the evidence. No basis has been established to interfere with that finding.
It follows that there was no error in the judge’s finding that the defence had been established.
Contributory negligence
The judge turned to consider the question of contributory negligence on the assumption that he was wrong on the issue of liability. He said:[34]
Whilst it is also strictly unnecessary to do so, if the court is wrong about all the above, and there was some kind of breach of duty to the plaintiff, or the circumstances were relevantly exceptional, and if the plaintiff contrary to the court’s findings did not consciously and voluntarily assume the obvious risk her conduct posed to herself, in light of the facts concerned the court would adjudge her 90% contributory negligent. In short, she got herself inebriated, and over repeated warnings undertook the actions she did, resulting in her fall and injury.
[34] [2014] SADC 178 at [81].
In my view, his Honour fell into error in adopting this course. His Honour had not only found that no duty of care existed but also that the plaintiff had voluntarily and consciously assumed an obvious risk. Having concluded liability against the plaintiff on those grounds, the judge should not have gone on to consider the question of contributory negligence.
In any event, the judge purported to apportion liability without identifying in what way the respondent was negligent. Accordingly, it was impossible for the judge to undertake the evaluative exercise of weighing the respective culpability of the appellant and the respondent for the purposes of apportionment.
Given that the appeal has failed on the question of liability, it is not only unnecessary but would be an error to undertake this exercise in this case. However, in some circumstances it would be appropriate for the court to make findings relevant to the question of the apportionment of liability. For example, in a case where the court only concluded that no duty of care existed. In those circumstances there is nothing illogical or contradictory in the court, having found against the plaintiff on the issue of liability, to proceed to make findings which might avoid the need for a retrial in the event an appeal court found that a duty of care did exist.
Damages
The trial judge assessed damages under the following heads:
Non-economic loss (15 points on the scale) $ 27,840
Past economic loss $ 13,000
Past loss of superannuation benefits $ 1,430
Future economic loss $ 25,000
Future loss of superannuation benefits $ 2,750
Past voluntary services $ 13,860
Future care $ 6,300
Future medical expenses $ 36,200
Past special damages $ 3,000
Total $129,380In addition, he found there is an entitlement to interest, not yet calculated, on past economic loss and past voluntary services.
The appellant submits that the award of damages in respect of non-economic loss, future economic loss, past voluntary services and future care was made in error and, in any event, is manifestly inadequate.
On 18 April 2009, the appellant was 33 years old. In the fall from the chair she suffered a right tibial plateau fracture with associated peroneal nerve damage (causing right foot drop) and a leg compartment syndrome. This required an emergency fasciotomy and an open reduction internal fixation of the fracture. In May 2011, she underwent further surgery for the removal of the metal work from her right knee. She has been left with extensive residual scarring to the right leg.
The plaintiff’s leg injury is likely to lead to the need for a knee replacement within 10 years. A prosthetic knee joint presently has a limited lifespan of about 15 years.
Importantly, the judge found the appellant had a debilitating degenerative back condition at the time of her fall from the chair. That back condition had troubled the appellant since at least 2001. The judge found that by 2009 this condition caused the appellant significant, continual, ongoing pain, requiring strong pain killing medication. This back condition was found by the judge to have been exacerbated by a road accident the plaintiff had on 8 March 2009.
The judge found that the appellant suffered from some pre-accident incapacity due to her degenerative back condition. He found she pursued a pre‑accident career in low paid part time work in the hospitality and food industry. Subsequent to the subject injury, in August 2010, she recommenced employment in well paid administrative and grain testing work in the agricultural industry.
The judge found that the appellant was earning more after the accident than she did before. The judge found her post injury gross earnings to be as follows:
2011 tax year $20,482
2012 tax year $44,475
2013 tax year $43,728
2014 tax year $50,339This is to be contrasted with her pre-accident earnings which were as follows:
2007 tax year $ 5,757
2008 tax year $11,951
2009 tax year $ 8,954Her earnings in the 2009 tax year represent earnings up to the date of accident only.
The judge found that due to the combination of the leg injury and her non-compensable degenerative back condition she is now not able to undertake moderate or heavy physical labour. Both conditions were found to contribute equally to her incapacity for that work. The judge found that she has a 20 per cent disability of her right leg as a result of the subject accident. The judge did not find that the subject accident resulted in any permanent aggravation of her pre‑existing back condition.
The judge found that the appellant continues to suffer ongoing pain from a combination of her back and leg injuries. He found both are likely to degenerate over time, however, the likely osteoarthritic leg injury degeneration could potentially be successfully addressed by arthroscopy and/or a knee replacement.
In relation to the loss of future earning capacity, the judge found:[35]
Her current job, although designated casual due to the employment practices of her current employer, is in effect a secure and ongoing job. The plaintiff is a valued and well regarded employee who her employer is keen to keep. There are other companies conducting similar businesses who I find the plaintiff would be qualified to gain employment with should she lose her current employment. She also now has skills in office administration which would enable her to secure that type of work in other industries and businesses.
The plaintiff has however lost capacity to do lower paid moderate to heavy manual labour, should she lose her current job and also be unable to secure the kind of work she currently does, or any other administrative job for which she is currently now also qualified. Only half of this loss is due to the leg injury. In the court’s view, in the totality of the plaintiff’s circumstances, this represents a very modest loss of earning capacity.
In the court’s view, it is likely that the plaintiff will remain gainfully employed in the type of role she currently enjoys, or a similar administrative role, for as long as she wishes to remain in the workforce.
She may need a knee replacement in perhaps 10 years’ time, which if she does will take her out of work for approximately three months, which at her current rate of gross pay equates to $12,500.
[35] [2014] SADC 178 at [199]-[202].
In relation to past and future voluntary services, the judge found:[36]
[36] [2014] SADC 178 at [205]-[214].
The court finds that the plaintiff was provided with very significant voluntary services by her daughter and mother for the first two months she returned from hospital, then gradually reducing services over the next 12 months until she moved out and took up employment with Cargill Grainflow in August 2010.
The agreed rate for performance of those services is $22 an hour.
From that time, however, whilst the court accepts that the plaintiff’s daughter Chloe has continued to provide substantial assistance around the house, and that has assisted the plaintiff, in fact the plaintiff has been capable with some effort on her part, of performing these services herself.
From that date, accordingly, the services provided by Chloe and anyone else were not reasonably required in a legal sense to have been performed for the plaintiff, nor would it have been otherwise necessary to engage someone to perform them.
I find that for the first month at home the plaintiff would likely have needed perhaps five hours provision of services per day, totalling approximately 150 hours for a 30 day month.
For the second month perhaps three hours per day, totalling 90 hours for a 30 day month.
Then, as an average for the next 12-13 months, perhaps one hour a day assistance, totalling perhaps 390 hours
Six hundred and thirty hours at the agreed rate of $22 an hour would total $13,860, so were an award to be made for past gratuitous services, it would be that sum, plus interest at the agreed rate of 6.5%.
The court finds that there is no ongoing need for voluntary services.
There would be a need for some voluntary service or paid support should the plaintiff undergo a knee replacement which on balance is likely in perhaps 10 years. On the basis of Dr D’Onise’s opinion that she would need considerable support for six weeks then lesser support for a further six weeks, the plaintiff would also be entitled to the present value of the cost of providing such support in 10 years’ time at the agreed future rate of $25 an hour for, in the court’s opinion, four hours a day for 42 days totalling 168 hours, then two hours a day for a further 42 days totalling 84 hours, for a grand total of 252 hours.
Against these findings, and the substantial reservations the judge had as to the credit and reliability of the appellant, I turn to consider the appellant’s submissions on damages.
Non-economic loss
The appellant submits that the award of 15 points on the scale was manifestly inadequate having regard to: the seriousness of the injury and complications; the periods of hospitalisation, immobility and lack of independence, especially considering the need for her to care for a young child; the substantial scarring and the inevitability of deterioration in function and increase in pain through degeneration of the right knee; the extended duration of that deterioration given the likelihood that the appellant will defer for as long as possible undergoing a knee replacement; and the likelihood that she will have to do so more than once with the attendant hospitalisations, rehabilitation, loss of mobility and risk of complication.
In my view, there was no error in the approach taken by the judge in assessing the award for non-economic loss. The judge did not overlook the factual considerations relevant to assessing damages under this head.
Non-economic loss is defined in s 3(1) of the Civil Liability Act as:
(a) pain and suffering; or
(b) loss of amenities of life; or
(c) loss of expectation of life; or
(d) disfigurement;
The approach to undertaking this assessment was considered by this Court in Packer v Cameron.[37] Whether the award is manifestly inadequate depends upon whether it falls outside a reasonable numerical range on the scale from 0 to 60, having regard to the nature of the non-economic loss suffered by the appellant and comparing that with the worst non-economic loss that might possibly befall anyone. This involves an evaluative judgment. Given the judge’s reservations in relying on the appellant’s evidence in making findings of fact, I undertake this judgment by reference to the objective evidence of the appellant’s non-economic loss rather than her subjective claims. While I consider that the award made is at the lower end of that scale, I cannot say that it falls outside the range so as to result in a finding that the award is so low as to be manifestly inadequate. No error has been demonstrated in the judge’s approach or in the award made.
[37] (1989) 54 SASR 246.
Future economic loss
The judge made an award of damages under this head of $25,000 plus future loss of superannuation benefits.
The appellant submits that the judge erred in assessing this sum, given the time that she would inevitably have away from work in the future for treatment to her knee including arthroscopy and, in all likelihood, more than one knee replacement. The appellant further submits that the judge erred in assessing damages on the basis that she was unlikely to be unable to find work in the future of the kind she is now undertaking.
The respondent submits that these arguments fail to recognise the substantial interference with her working capacity caused by her pre-existing back condition, and that any future loss is likely to be some considerable time in the future and must be discounted accordingly.
In my view, the award made by the judge for future economic loss is inadequate. The judge considered that her serious leg injuries resulted in a very modest loss of earning capacity. I do not agree.
In National Insurance Co of New Zealand Ltd v Espagne[38] Windeyer J recognised that the fact a plaintiff may earn more post-injury does not mean that the plaintiff has not suffered a loss of earning capacity which must sound in an award of damages.[39]
[38] [1961] HCA 15, (1961) 105 CLR 569.
[39] [1961] HCA 15 at [17], (1961) 105 CLR 569 at 598. See, for example, Burford v Steer (1984) 118 LSJS 139.
Moreover, the appellant suffers from a significant disability. The judge found this was a 20 per cent loss of function of the right leg. As Stephen J said in Wade v Allsopp:[40]
… whereas diminished capacity to perform useful services may be expressed by a percentage figure the process of selecting one from a number of applicants for employment is, on each occasion, an all or nothing affair in which the applicant with diminished capacity may each time be wholly unsuccessful.
[40] (1976) 10 ALR 353 at 361.
While at trial the appellant was apparently in secure employment, she was only 38 years of age. Her current employment is in the agricultural industry. That industry is notoriously subject to seasonal conditions. If she was to lose her current employment, notwithstanding that her skills may make her, as the judge found, attractive to other employers, she is still vulnerable to periods of unemployment, perhaps lengthy, because of her physical disability. In addition, there is the chance that she may have lengthy periods off work in the future for treatment to her knee. Knee replacement surgery would see her incapacitated for a period of three months.
While, in accordance with the principle in Watts v Rake,[41] some discount must be made in assessing damages for the contingency that, at some indeterminate time in the future, she may be rendered totally incapacitated for work by her non-compensable back condition, nonetheless, I consider the award of $25,000 to be manifestly inadequate. Necessarily an award under this head must involve a broad axe assessment. Having regard to the nature of her disability, her potential earnings, the prospect of time away from work for knee surgery and her vulnerability to periods of unemployment if she was to lose her current employment, I would consider an appropriate award under this head is $75,000.
[41] [1960] HCA 58, (1960) 108 CLR 158 at 160 and 165.
While this award is made now for losses in the future, resulting in the appellant having the use of those moneys immediately, I do not consider it is appropriate to discount the award given the inevitable increase in the nominal value of wages over time.
The increase in the award for future economic loss leads to an increase in the award for future loss of superannuation benefits to $8,250.
Past voluntary services
The appellant submits that the judge erred in assessing the award for past gratuitous services on the basis that there was no need for such services beyond August 2010. She submits that the court should have found a continuing need for the provision of services on the same basis as was being provided at that time, namely, one hour per day.
Subject to one matter, this submission fails to recognise the judge’s finding, based on the appellant’s credit and reliability, that there is, and was, no ongoing need for voluntary services.[42] However, the judge’s reasons appear to overlook the increased need for voluntary services following the further surgery in 2011 for removal of the metal work.
[42] [2014] SADC 178 at [213].
Doing the best I can in the absence of precise evidence as to the extent of the need for additional assistance during the recovery from surgery in May 2011, which I am satisfied has been proved, I would estimate an additional two hours per day for four weeks. For the purposes of s 58(3) of the Civil Liability Act I infer that if those services had not been provided gratuitously by the appellant’s mother and child, another person would have been paid to provide those services.[43] This produces a figure of $1,230. Accordingly, I would substitute an award under this head of $15,090.
[43] Terry v Leventeris [2011] SASCFC 26 at [37], (2011) 109 SASR 358 at 369 – 370.
Future care
The basis of the judge’s award under this head is confined to the need for future care by way of attendant services for a period of three months following one total knee replacement in 10 years’ time. The appellant submits that the basis of the award disregards her need for the provision of additional services in the future, including an increasing need as she gets older and degenerative changes in her knee result in a decrease in functionality and the possibility of the need for a further knee replacement.
In my view, this submission must be accepted. The judge awarded an amount of $6,300. It is not certain that the appellant will require a second knee replacement. I would assess that prospect at 50 per cent. That would require an increase in the award by $3,150. There can be no precision in calculating the extent of her need for further assistance in the coming decades as a result of ongoing degenerative change in her right knee. That matter is further complicated by the possibility that the degeneration could be prevented by arthroscopy and/or knee replacement. Doing the best I can, I would increase the award under this head to $12,000.
Conclusion on damages
If I had found the respondent liable to the appellant for her injuries, I would have set aside the amount of the damages assessed by the judge and substituted an award of $191,810.
Conclusion
I would dismiss the appeal. I would hear the parties as to costs.
LOVELL J. I would dismiss the appeal. I agree with the reasons of Stanley J.
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