Sorenson v Woolnough

[1989] TASSC 36

Serial No 32/1989
List "A"

CITATION:              Sorenson v Woolnough [1989] TASSC 36; A32/1989

PARTIES:  SORENSON
  v
  WOOLNOUGH

TITLE OF COURT:  SUPREME COURT OF TASMANIA
JURISDICTION:  ORIGINAL
FILE NO/S:  416/1987
DELIVERED ON:  23 August 1989
JUDGMENT OF:  Underwood J

Judgment Number:  A32/1989
Number of paragraphs:  54

Serial No 32/1989
List "A"
File No 416/1987

SORENSON v WOOLNOUGH

REASONS FOR JUDGMENT  UNDERWOOD J

23 August 1989

1. The plaintiff's claim is for damages for negligent driving.

1. On the evening of 21 July 1984 the plaintiff and the defendant were spectators at the Moonah indoor cricket centre. About midnight the defendant decided to go home. She had met the plaintiff on a previous occasion and, as they both lived in Johnston Street Moonah, a short distance away, offered him a lift home in her Ford Cortina sedan. The defendant said that as she turned left from Main Road into Johnston Street she took the corner wide and then realised that she had been driving without her lights on. She turned the lights on and came back to the correct side of the road. As she did so she saw a flat tray truck parked on its correct side of the road immediately in front of her but was unable to avoid a collision with the rear of this vehicle. The plaintiff has no memory of the events between shortly prior to leaving the cricket centre and the 24 July 1984 when he found himself in hospital and was informed that he had been in an accident.

1. The defendant's account was substantially corroborated by Miss Julie Parish who was sitting in her parked car outside her home in Johnston Street, almost directly opposite the stationary truck. I accept Miss Parish's evidence as an accurate account of the events leading up to the accident and find that the flat tray wood truck was parked close to and parallel to the gutter some five or six houses from the junction of Main Road Moonah and Johnston Street, facing the direction in which the defendant was travelling. The defendant's car went onto the wrong side of the road as it turned the corner from Main Road. It had no lights on. It then came back onto its correct side of the road and the headlights were switched on. By this time, it was close to the rear of the parked truck. The defendant's car then turned back towards the centre of the road but failed to avoid the tray of the truck. The left hand side of the defendant's car was driven under the rear of the tray of the truck and the plaintiff sustained substantial head injuries. Miss Parish estimated that the defendant's speed along Johnston Street was in the order of twenty miles per hour. She said that it did not appear to brake or slow down before the impact.

1. Senior Constable Leigh attended the scene of the accident at about 12.25am. I accept his evidence that the force of the impact between the defendant's car and the tray of the truck was sufficiently severe to push the tray forward into the rear of the truck's cabin. The damage to the defendant's vehicle on the left hand side was extensive. The front passenger side windscreen pillar was bent back in the shape of a "V". The roof was pushed back and up in the front centre and back and down on the passenger side. The damage as described by Senior Constable Leigh leads to the clear inference that, on impact, the rear edge of the tray of the truck protruded into the defendant's vehicle to some point past the front of the dashboard.

1. I find that the defendant was negligent in failing to keep any proper lookout and driving without her lights on. Senior counsel for the defendant did not submit that such a finding was not properly open on the evidence. However, he did submit that the injuries sustained by the plaintiff were caused by or contributed to by the plaintiff's failure to warn the defendant that she was driving without lights on and by failing to wear a seat belt.

1. There is no substance in the first allegation. The defendant said that she turned her lights on immediately after turning from the well lit Main Road into the less well lit Johnston Street. She said that there was nothing the plaintiff could have said or done which would have caused her to turn her lights on any earlier than she did after turning the corner.

1. There was a conflict in the evidence concerning the plaintiff's use of a seat belt. I find that the Cortina sedan was fitted with two bucket type seats in the front which were designed to tip forward to permit access to the back seat through either of the two doors. Both front seats were fitted with lapsash seat belts. The belts were not the modern inertia reel type and relied for adjustment on a slide fitted to the "sash belt". The defendant claimed that she knew that the plaintiff was not wearing a seat belt because:

1She was, by habit, alert to the safety advantages of wearing a seat belt and always told her passengers to put their seat belts on but she recalls omitting to so direct the plaintiff when he first got into the car.

2Immediately after the accident she looked across at the plaintiff and saw him sitting bolt upright in the passenger seat with his hands by his side, "all shrouded in white" and the seat belt hanging from the hook on the pillar to the rear of the passenger side door.

3Some time after the accident she saw marks on the edge of the soft vinyl dashboard in front of the passenger seat which appeared to her to look like indentations made by teeth.

1. I am unable to accept the defendant's evidence with respect to this matter. It was clear from her cross–examination that, immediately after the accident, although herself only slightly injured, the defendant was in a state of great shock and had no clear memory of the position of the plaintiff's seat belt or the extent of the damage to the car. The vinyl dashboard was old and cracked in several places. The passenger side of the vehicle was so badly damaged that the ambulance rescue unit was needed to prise the roof away and cut off the passenger side door to get the plaintiff out. The marks described by the defendant by a drawing she made in the witness box differ quite markedly in shape and location from marks on the dashboard described by her husband to which I shall refer shortly. Whatever the marks were and where ever they were located they could have been made during the process of extricating the plaintiff from the vehicle. It was clear that the defendant felt badly about the accident and the injuries that the plaintiff had sustained. There exists a real possibility that her claimed memory of failing to direct the plaintiff to put his seat belt on when he first got in the car and seeing it hanging from the pillar is a piece of ex post facto rationalisation.

1. The defendant's husband was at the scene of the accident moments after it happened. He also claimed to have seen the passenger side seat belt hanging from its hook on the pillar. As in the case of the defendant's evidence, Mr Woolnough's cross–examination left me in considerable doubt about the accuracy of his claimed recall on this matter. He described, also by diagram, what he called teeth marks in the vinyl dashboard but claimed that they were on the top of the dashboard and not on the edge. He agreed that the marks drawn by his wife were nothing like the marks that he first saw when he inspected the car at the police garage later that morning. Having regard to the slope of the windscreen it would have been inherently difficult for the plaintiff's teeth to mark the top of the dashboard in the place described by Mr Woolnough. Taking into account the damage that was done to the vehicle in order to extricate the plaintiff there is no warrant for drawing the inference that the marks described by Mr Woolnough were caused by the plaintiff's teeth as opposed to instruments or tools used by persons engaged in the task of removing the plaintiff. Further, the plaintiff's evidence which was not challenged, was that he had an upper set of dentures which were not broken or damaged in any way in the accident.

1. Senior Constable Leigh had no recollection of observing whether the plaintiff was wearing a seat belt or not when he arrived on the scene. However, he tendered in evidence an accident report form which he had completed within a few hours of the accident. In that form he made an entry to the effect that both the driver and the passenger were wearing seat belts. Mr Leigh said that those entries would have been made from either his own observations or from information given to him, presumably by the defendant.

1. Having regard to the fact that the passenger side of the car was driven under the tray of the truck, that on impact the rear edge of that tray protruded some distance into the car and that the passenger's seat belt may not have been adjusted to fit the plaintiff's body, the proposition that the head injury sustained by the plaintiff was caused by contact with the tray of the truck whilst he was wearing the seat belt fitted in the car cannot be excluded.

1. In the circumstances, the defendant has failed to discharge the onus she carries of establishing on the balance of probabilities, that the plaintiff was not wearing his seat belt and that such failure contributed to his injuries. I turn to the question of damages.

1. The plaintiff was born on 6 August 1960. He is unmarried and lived alone in a flat in Johnston Street. At the time of the accident he was employed as a boot maker at Blundstone Pty Ltd, Footwear Manufacturers.

1. I accept the evidence of Dr Duffy, neurosurgeon and Mr Bent, clinical psychologist, that in the accident the plaintiff sustained the following injuries:

1Frontal lobe damage to the brain. There was a period of some days' impaired conscious state and post and pre–traumatic amnesia.

2A fracture to the base of the skull which permitted leakage of cerebral fluid and involved damage to the nerve to the right ear.

3A non displaced fracture of the fifth cervical vertebra.

4A depressed fracture of the left zygoma and a non displaced fracture of the left side of the body of the mandible.

5Deviation of the septum.

1. On 28 July 1984 the fractured zygoma was elevated by surgical intervention. The plaintiff was discharged from hospital after a relatively short stay. The fracture at the base of the skull healed without apparent residual disability. In August 1985 the plaintiff returned to hospital where the deviation of the septum was corrected to enable the plaintiff to breath freely through both nostrils. His only lasting complaint from this injury is a tendency to suffer from a "runny nose" on one side, a complication which the ear, nose and throat specialist, Mr Merry, said is not uncommon. It is a permanent but not significant disability.

1. The plaintiff has made a full recovery from the fractured zygoma and mandible apart from some local minor skin irritation in the summer, and an occasional "creak" in the jaw.

1. After his initial discharge from hospital in 1984 it was noted that the plaintiff was experiencing a reduction of hearing and a malfunction of the eustachian tube on the right side. The function of the eustachian tube is to ventilate the middle ear. The plaintiff suffers from a build up of pressure in the inner ear similar to that experienced by aircraft passengers during the ascent of the aircraft. The plaintiff clears this pressure by periodically pinching his nostrils and blowing air from his lungs into his closed mouth.

1. In October 1985 the plaintiff was re–admitted to hospital where Mr Merry carried out a right ossicular chain reconstruction being a reconstruction of the small bones in the ear used to transmit sound. The procedure improved, but did not eliminate, the conductive hearing loss on the right side.

1. The plaintiff subsequently developed repeated ear infections and a small perforation in the upper part of the ear drum. Conservative treatment did not alleviate these conditions so in November 1987 he was again admitted to the Royal Hobart Hospital for further ear surgery. The problem was corrected by the excision of unstable skin and grafting to the ear drum.

1. Notwithstanding the surgical procedures the plaintiff is left with some residual disability in his right ear. There is a conductive loss of hearing which, in Mr Merry's clinical assessment, is in the order of 30 to 40%. In practical terms this loss means that the plaintiff experiences difficulty in locating the source of sounds by reason of impaired perception of stereo reception and difficulty in clearly distinguishing consonants at the beginning and end of words especially when there is background noise. These disabilities are permanent. In Mr Merry's opinion whether or not the use of a hearing aid would assist the plaintiff is speculative until the plaintiff has tried to use one. This the plaintiff has not done and I gathered the clear impression from his evidence that, so far as he is concerned, the conductive loss of hearing causes him no great social disability.

1. However, the plaintiff has two other complaints associated with the injury to the right ear. The first is what he described as an "echo effect". Immediately after exposure to a loud noise, the plaintiff hears a quieter repetition of that noise like an echo. Mr Merry's opinion was that this effect is caused by damage to the eustachian tube or by the operative procedures undertaken on the ear. The condition is permanent. The second complaint the plaintiff described as "the siren effect". This is the perception of a continuous, usually high pitched, tone in the right ear. The volume and pitch vary from time to time but generally its level is such that during ordinary conversation it is not detectable. Mr Merry described the condition as tinnitus. There are many causes for this condition. It is a common complaint following injury to the ear. The plaintiff said that he first noticed it on the eve of the last operation to the ear in November 1987. Mr Merry said that if this was the case it was difficult to ascribe a cause but if it appeared immediately after that operation a likely cause would be the surgical intervention. The plaintiff did not suffer from this condition prior to the accident. The temporal connection between its onset and the injuries sustained to the ear together with the subsequent surgical procedures and the opinion of Mr Merry that the injuries and procedures are possible causes, satisfies me on the balance of probabilities that the condition was caused by the defendant's tortious conduct. Given the persistence of the complaints since 1987 I accept Mr Merry's opinion that the condition is permanent.

1. The fracture of the fifth cervical vertebra is productive of pain and discomfort in the neck when the plaintiff lifts heavy weights or holds his head in one position for a prolonged period of time. I accept Mr Duffy's opinion that this condition is permanent and exposes the plaintiff to the risk of symptoms from post traumatic arthritis at some undefinable later time in his life. The plaintiff also suffers from headaches from time to time which probably arise from stress to the fractured vertebra and the defects in the right ear.

1. Although the injuries which I have dealt with in some detail are substantial, the plaintiff's greatest disability arises out of the damage to his frontal lobes. In this connection I accept the evidence given by Mr Bent who subjected the plaintiff to an extensive array of psychological tests. The frontal lobes govern a person's initiative and motivation. They are responsible for the ability to plan, organise, control and pursue a course of action. According to Mr Bent, damage to the frontal lobes does not change established personality traits but is likely to exacerbate or depress any one or more of these traits. Mr Bent said that he was able to make an assessment of the plaintiff's pre–morbid condition and I accept his assessment. It coincided with my own impression of the plaintiff after listening to and observing him and his mother whilst they were giving evidence.

1. I find that prior to the accident the plaintiff's intellectual quotient was in the order of 104 but that by reason of the injuries he suffered it has been reduced by some 15 to 19%. The plaintiff was and is a person of low average emotional stability, insecure and lacking in self confidence. As Mr Bent observed, he never was "the life of the party". Prior to the accident, apart from his work, the plaintiff's real interest lay in sport, principally football and cricket. He regularly played in competition games with the Southern Amateur Football League and each year succeeded in winning an award for outstanding play. In the summer, he played club cricket with similar success. His social life revolved around his sporting companions and consisted of associating with them at club functions and in various hotels. His relationship with the opposite sex was limited to one or two girlfriends each lasting for a period of about two or three months. He said, and his mother confirmed, that before the accident he was of even tempered disposition. It is perhaps significant that he had never been reported by a football umpire for misbehaviour during a match. Most weekends and some Thursday nights he spent with his friends but otherwise stayed at home and went to work.

1. Mr Bent's tests disclosed that the plaintiff is and was above average in his conformity to social norms and moral principles. He had and has a basic resourcefulness and possesses reserves of self discipline. As a result of the damage to the frontal lobes he has suffered, in addition to the diminution in his I.Q., a serious impairment to his short and long term memory. Accepting the average memory quotient for persons of similar age and background to the plaintiff as 100, Mr Bent assessed the plaintiff's memory quotient at 80.

1. The injury also caused impaired capacity for spatial analysis and organisation and poor hand/eye co–ordination skills. These impairments are compounded by a diminution in visual memory. These disabilities have had a marked effect on the plaintiff's capacity to continue with his employment in the boot factory. Damage to the frontal lobes has also caused a diminution in concentration, a reduced ability to solve problems, an exacerbation of a tendency to obsessional behaviour, anxiety, frustration and a resultant loss of temper. The plaintiff's life–style is maintained by drawing on his basic reserves of self discipline and mature judgment. I find that his disabilities are permanent. They have had a profound effect on the plaintiff's life.

1. The plaintiff left school when he was 16. He reached grade 10 but achieved only average success in level II subjects. Shortly after leaving school he gained the only job he has ever held; a boot maker at Blundstone Pty Ltd Footwear Manufacturers. The plaintiff described in some detail the various machines he worked on at Blundstones and it was apparent that his claimed enthusiasm for work was genuine. He took pride in ensuring that he did a good job. The factory manager, Mr Stacey, whose evidence I accept, described him as being an average reliable employee before the accident who had every prospect of long term employment with Blundstones but was not seen as supervisor material for he lacked motivational and communication skills. During his employment at Blundstones the plaintiff was required to work at different machines each of which performed one part of the boot making process which was carried out on an assembly line basis. High productivity was and is an essential requirement of all employees. The work necessitates considerable concentration and a high degree of hand/eye co–ordination. The plaintiff was obviously proud of the fact that shortly before the accident his employer selected him to operate a new machine installed in the factory. He said, and I accept, that he took pride in his work, got on well with his work mates and saw himself staying at Blundstones for the rest of his life.

1. After the accident the plaintiff returned to Blundstones but it was clear that his capacity for work had considerably diminished. His employer was tolerant and caring and made allowances for his disabilities in the hope that he would eventually return to his former capacity.

1. Mr Stacey said that the plaintiff returned to work in August 1984. Initially, he noticed that the plaintiff was still physically affected by the injuries he had suffered but it was expected that he would make a full recovery. However, this did not occur. Mr Stacey noted a reduction in the plaintiff's hand/eye co–ordination skills and diminished productivity. He considered that there were some machines, at which the plaintiff had previously worked, which he could no longer handle as his skills had diminished to such an extent that their operation exposed him to the risk of injury. Mr Stacey said that the plaintiff complained of headaches and on occasions he had seen him sitting by his machine holding his head. Mr Stacey noted evidence of frustration and displays of bad temper not present before the accident and apparently caused by noise in the work place or the plaintiff's inability to carry out his work properly. He assessed that the plaintiff was working at something in the order of 60% of his former capacity and although there were periods when his performance improved, that overall diminution in his work capacity remained constant.

1. Over the years, following the plaintiff's return to work his employer persevered with him and moved him from machine to machine in the hope that eventually a process would be found which the plaintiff could carry out at a productivity level consistent with other employees. This did not eventuate. There were several discussions concerning the plaintiff's future between Mr Stacey and the plaintiff, his mother and his solicitor. In the end, Mr Stacey was compelled to give the plaintiff notice and he left Blundstones on 21 March 1988. He has not been in gainful employment since that date.

1. Mr Stacey's account was confirmed by the plaintiff who acknowledged that he had been unable to resume working at his pre–accident capacity. He said that such knowledge troubled and frustrated him. He found that he became irritable because of the noise in the factory and his failure to do his job properly. He said that he suffered from headaches and pain in the back of his neck, sometimes radiating to the shoulder, after standing in one position over a machine for a prolonged period of time. The plaintiff became depressed and worried about this state of affairs and slept badly.

1. In general terms however, the plaintiff is reasonably fit and jogs seven or eight kilometres on about four nights each week. Any greater distance brings on discomfort in his neck. The plaintiff has noted a drop in his level of concentration and finds that he cannot read to the extent he used to before the accident. Curiously, he has never held a driver's licence or driven a motor vehicle. Although in 1985 the plaintiff returned to his football club for a training session he did not resume playing the sport. He said that "it just didn't seem right", "I felt like a stranger" and "things looked different". He made a similar attempt to return to football at the beginning of the 1986 season with the same result. In cross–examination he said that he "just couldn't get motivated to play football". His former cricket club ceased to exist and he has made no attempt to take up the sport with any other club. As a result, he gradually lost contact with those people who formed his social companions and now goes out socially on only rare occasions. Asked why this was so he said that he didn't know; "I just can't answer that".

1. From the evidence of Mr Bent I infer that the diminution in the plaintiff's skills essential to success in sport, the decrease in his levels of motivation, initiative and ability to plan and follow through a course of action, together with impaired concentration and memory, all due to the damage to the frontal lobes, caused the plaintiff to withdraw from his former sporting and social pursuits. This has greatly diminished the quality of his life.

1. The plaintiff said that he wants to work. I accept that statement. Since leaving Blundstones the plaintiff has been registered with the Commonwealth Employment Service and has made his own efforts to find work. He completed a "Job Start Course" which taught him rudimentary skills for the making of job applications. For a short period he worked on an unpaid basis for about two hours a day with the YMCA gardening and clearing up. He said he would like to work as a gardener, cleaner or a storeman. He said that he was interested in cooking and would be prepared to try out work in a hotel. He is bored with his present life–style in which "the highlight of the day" is the preparation of the evening meal. It was not suggested by the cross–examination of the plaintiff that since March 1988 he has not been diligent in looking for work.

1. I accept the evidence given by the Assistant Director of Parks and Gardens, Hobart City Council, that unskilled gardening jobs with the Council are available from time to time but the competition to obtain them is keen. Further, such work involves some lifting and digging which, if prolonged, would be likely to cause the plaintiff pain in his neck and shoulder. No doubt the same can be said with respect to gardening jobs with other employers.

1. Counsel for the plaintiff submitted that, as a result of the damage to the frontal lobes the plaintiff is unlikely to be able to learn new skills and I accept that. He also submitted that the plaintiff's earning capacity had been totally destroyed but that contention is not made out by the evidence. It has been substantially diminished but I find that the plaintiff is not totally incapacitated from earning income. His steady nature, basic inner resourcefulness and desire to work will eventually result in him finding some employment. His employment will need to be one that does not require a high degree of concentration or hand/eye skills. He will not be able to cope with work involving pressure or physical stress on his injured vertebra and surrounding tissue. However, accepting these restrictions and his lack of skills, I consider the probabilities are that the plaintiff will from time to time earn income from his residual earning capacity perhaps working as a cleaner or a kitchen hand in a hotel. It is likely that the plaintiff will experience substantial periods of unemployment and, as he gets older, his prospects of gaining work will diminish.

1. With respect to past economic loss it was agreed that the plaintiff's net loss of income from the date of the accident to 1 August 1989 (the first day of the trial) was $22,739. It was also agreed that, had the accident not occurred and the plaintiff remained at Blundstones, his net weekly wage at 1 August 1989 would have been $285.12. I find that, but for the accident, the plaintiff would still be employed at Blundstones and the probabilities are that he would have remained in that employment or similar employment until aged at least 65 years. Blundstones do not require their employees to retire at any particular age. To take into account the period between the commencement of the trial and delivery of judgment, but without claim to mathematical precision, I would round off the figure for damages for past loss of earning capacity at $23,300.

1. On the plaintiff's submission that total destruction of earning capacity had been established the damages from 1 August 1989 until the plaintiff reaches 65 years were claimed as follows:

Present age 29 to 65 years –

36 years x $285 per week

discounted by 3%  $312,075

1. The calculation is correct but this is not a case in which the damages for diminution of earning capacity can be calculated by the application of mathematical formulae. The use of formulae is legitimate to indicate the outer parameters of the award but, having regard to the plaintiff's residual earning capacity, assessment is ultimately a matter for judgment taking into account the factors I have referred to.

1. In assessing damages for diminution of earning capacity the courts have frequently taken into account what has been called "the vicissitudes of life" (Arthur Robinson (Grafton) Pty Ltd v Carter (1969) 122 CLR 649 at p659). There are no special circumstances surrounding this plaintiff to indicate that, prior to the accident, he was exposed to anything other than the ordinary risks of temporary or permanent impairment of earning capacity to which any other physically fit unskilled young man was similarly exposed. In saying this I do not overlook the evidence of Mr Stacey that, to remain viable in the world market in which its products are sold, Blundstones need to continually maintain its operations at a highly competitive level.

1. Senior counsel for the plaintiff submitted that in the assessment of damages for future lost earning capacity I should take into account the fact that, after a qualifying period calculated in accordance with the provisions of the Social Security Act, the plaintiff has a potential entitlement to the receipt of unemployment benefits and that this is a factor to be taken into account in the assessment of damages for future lost earning capacity.

1. The principles governing the circumstances in which the court takes into account the receipt of financial benefits which a plaintiff would not have received but for his tortiously caused injuries are well settled. In National Insurance Co of New Zealand Ltd v Espagne (1961) 105 CLR 569 Dixon CJ said at p573:

"There are certain special services, aids, benefits, subventions and the like which in most communities are available to injured people. Simple examples are hospital and pharmaceutical benefits which lighten the monetary burden of illness. If the injured plaintiff has availed himself of these, he cannot establish or calculate his damages on the footing that he did not do so. On the other hand there may be advantages which accrue to the injured plaintiff, whether as a result of legislation or of contract or of benevolence, which have an additional characteristic. It may be true that they are conferred because he is intended to enjoy them in the events which have happened. Yet they have this distinguishing characteristic, namely they are conferred on him not only independently of the existence in him of a right of redress against others, but so that they may be enjoyed by him although he may enforce that right: they are the product of a disposition in his favour intended for his enjoyment and not provided in relief of any liability in others fully to compensate him".

Windeyer J said at pp599–600:

"In assessing damages for personal injuries, benefits that a plaintiff has received or is to receive from any source other than the defendant are not to be regarded as mitigating his loss, if: (a) they were received or are to be received by him as a result of a contract he had made before the loss occurred and by the express or implied terms of that contract they were to be provided notwithstanding any rights of action he might have; or (b) they were given or promised to him by way of bounty, to the intent that he should enjoy them in addition to and not in diminution of any claim for damages. The first description covers accident insurances and also many forms of pensions and similar benefits provided by employers: in those cases it is immaterial that, by subrogation or otherwise, the contract may require a refund of moneys paid, or an adjustment of future benefits, to be made after recovery of damages. The second description covers a variety of public charitable aid and some forms of relief given by the State as well as the produce of private benevolence. In both cases the decisive consideration is, not whether the benefit was received in consequence of, or as the result of the injury, but what was its character: and that is determined, in the one case by what under his contract the plaintiff had paid for, and in the other by the intent of the person conferring the benefit. The test is by purpose rather than by cause."

1. The correctness of the above principles was affirmed by all the Justices in Redding v Lee:Evans v Muller (1982) 151 CLR 117 although their Honours were not all in agreement with respect to the effect of an application of those principles to the legislation under consideration in those cases. Evans v Muller concerned the question of whether unemployment benefits received prior to trial should be deducted from the award of damages for past lost earning capacity. The majority, Mason, Dawson, Wilson, Deane JJ held that such benefits should be taken into account and the award reduced accordingly. In their joint judgment, dealing specifically with Evans's case, Mason and Dawson JJ said at p144:

"As we indicated earlier, the central question in this appeal is whether the unemployment benefits can be said to be a substitute or partial substitute for wages, justifying the same treatment as wages in terms of assessment of damages."

Wilson and Deane JJ concurred in those reasons.

1. All of the Justices in Muller and Redding's case were of the opinion that where there is a legislative requirement for the repayment of benefits received the clear intention is that the benefit is not to be taken into account upon an assessment of damages. See Gibbs CJ p175; Brennan J p163. Deane J concluded his judgment at p168 with the statement that, if the application of the settled principles produced a difference in treatment between invalid pensions and unemployment benefits then it was for the legislature to remedy the situation by providing for the recoupment of such benefits from an award of damages. At that time, there was no legislative requirement for the repayment of unemployment benefits.

1. By an amendment to the Social Security Act (Act No106 of 1986, s48) provision was made for the recoupment from an award of damages of (inter alia) unemployment benefits. There appears little doubt that had this legislative provision been in force at the time Muller v Evans was decided the dissenting opinions would have been shared by the majority.

1. With respect to the claim for damages for lost earning capacity prior to trial the agreed figure was reached on the basis that no deduction was to be made for the receipt of unemployment benefits after 1 May 1987 as they will have to be repaid in accordance with the amended legislation. Although Evans v Muller was concerned only with the effect of the receipt of unemployment benefits on damages for diminution of past earning capacity, Gibbs CJ said at p132:

"Yet there is no reason in principle to distinguish between present and future receipts of unemployment benefit in making an assessment."

1. Applying that principle, the Queensland Full Court in Jesberg v Rackemann [1986] 1 Qd R 181 held that in assessing damages for loss of future earning capacity it is necessary to take into account the plaintiff's right to receive unemployment benefits in the future. Kelly SPJ dissented but acknowledged that there was no reason in principle to distinguish between past and future unemployment benefits. Jesberg was decided before the legislative change was made to the Social Security Act in 1986. In Muscat v Statewide Industries Pty Ltd [1988] 1 Qd R 637 Ambrose J (obiter dicta) observed, in my respectful view, correctly, that the legislative basis underpinning the decisions of Muller v Evans and Jesberg v Rackemann had been altered. However, I think it is an over simplification to conclude that the legislative change means that in an assessment of damages for lost earning capacity the future receipt of unemployment benefits should be ignored. The Social Security Act now provides, in addition to a right to recoup benefits paid, that applicants are ineligible to receive unemployment benefits during "the lump sum period", (s153(1)). The method of calculating the lump sump period is prescribed by s152(2)(e). It provides the court with an insoluble problem if the prospect of the receipt of unemployment benefits is to be taken into account in assessing damages for future lost earning capacity, thereby reducing an award which otherwise would have been made. Central to the calculation of the lump sum period is the award of damages for future lost earning capacity. If the period of ineligibility for receipt of payments has to be ascertained before the quantum can be assessed, calculation of the lump sum period would, it seems to me, be an impossibility. I was informed by consent that at the present time, the average total weekly earnings of all male employees in Australia is $511.60. If an appropriate sum for damages for future lost earning capacity, after taking into account as a contingency the prospect of receipt of future unemployment benefits, is $140,000, the lump sum period is $140,000 $511.60 or 5.2 years from the date of judgment. During this period the provisions of s.153(1) disentitle the plaintiff from receiving benefits. Thus it would appear, as a matter of logic, that the assessed sum of $140,000 is flawed as it would be wrong to discount the damages by reason of the prospect of the receipt of benefits during the next 5¼ years.

1. In Jesberg's case Kelly SPJ said at pp181–182 with respect to Tuncel v Renown Plate Co Pty Ltd [1976] VR 501 and Bertram v Kopodistrias [1984] VR 619:

"The Full Court of the Supreme Court of Victoria considered the question of future receipts of unemployment benefits in Tuncel v Renown Plate Co Pty Ltd but the report of that case in [1976] VR 501, although dealing with the question of unemployment benefits generally, sets out only the conclusion of the court that such benefits received up to trial are to be taken into account. However, in the course of his judgment in Bertram v Kopodistrias Gobbo J at pp625–626 sets out a subsequent passage in the judgment in Tuncel's case which had been omitted from the report in the Victorian Reports in which, after the passage in the judgment stating the conclusion to which I have referred, it was simply stated at p512:

'The court then considered the argument of the defendant that the award of general damages for future diminished earning capacity was erroneous.'

In the course of the passage referred to by Gobbo J, in referring to the figure which the court had independently assessed for general damages it was said:

'In arriving at that figure, we make due allowance for the various notorious factors of discounting, including the advantages for which the plaintiff might have in his power to apply to the Commonwealth for future unemployment benefits.'"

1. In Triffett v Thomas B34/1986, Nettlefold J said at p16 of his reasons for judgment that he found the reasoning of the majority judges in Jesberg v Rackemann persuasive and that the possibility of receipt of unemployment benefits in the future is to be taken into account in the assessment of damages for impaired earning capacity.

1. I accept that in principle, the prospect of the receipt of unemployment benefits in the future after the expiry of the "lump sum period" is a matter to be taken into account as a contingency in the assessment of damages for future lost learning capacity but, in most cases, the application of this principle is to be treated in a broad practical common sense way. There are many factors which impinge upon a consideration of this question. Some of them were referred to by Gobbo J in Bertram's case and summarised by Kelly SPJ in Jesberg at p183 as follows:

"1The benefit is not one which it can be asserted as a matter of certainty will always exist in substantially this form;

2There are provisions in the legislation (the Social Security Act 1947 (Commonwealth)) which give a review discretion in respect of conferring the benefit;

3There may be reduction in the benefit due to income of a spouse;

4The size of the benefit may vary also according to the number of children;

5The benefit is subject to a waiting period, although this was not regarded as a significant factor;

6There is the significant problem of adjusting the level of benefit by the level of income that may be received; the legislation requires income to be taken into account in reduction of the benefit so that the income derived in the future from the verdict sum could not properly be ignored."

1. It seems to me that there is particular significance in the last mentioned point because if the court correctly assesses the damages, ie, restores the plaintiff to the financial position in which he would have been had the accident not occurred, the likelihood of future eligibility to receive unemployment benefits after the expiration of the lump sum period, will be considerably diminished by reason of income earned on the lump sum or from investments made with that sum. See Hall v Grimwood [1979] Tas R 220 at p222.

1. Taking all these matters into account on the question of contingencies, I would ascribe a figure in the order of 10%. For the reasons expressed I assess the plaintiff's damages for future lost earning capacity in the sum of $140,000.

1. In addition to the claims for damages for past and future diminution in earning capacity the plaintiff is entitled to a sum by way of general damages to compensate for past and future pain and suffering and the loss of the amenities of life. Taking into account the need for moderation and taking care to ensure that the plaintiff is not over compensated by reason of the various heads of damages overlapping I assess this head of damages in the sum of $22,000. Finally, the plaintiff has a claim for past and future pharmaceutical expenses. With respect to the past, this was agreed at $387.05. The plaintiff has established that he will continue to require analgesics and an ointment which gives some relief to his aching neck. There was no evidence to establish that the other drugs the plaintiff is taking were to alleviate symptoms arising from the injuries sustained in the accident. I allow the sum of $1,000 under this head of damage. In summary the plaintiff is awarded:

Damages for past loss
of earning capacity  $ 23,300.00

Damages for future loss
of earning capacity  $140,000.00

General damages  $ 22,000.00

Damages for past and
future medication  $ 1,389.05

(rounded off)                  $186,700.00

1. There will be judgment for the plaintiff against the defendant for $186.700.00.