Sretenovic v Reed

Case [2009] NSWCA 280

NEW SOUTH WALES COURT OF APPEAL

CITATION:
Sretenovic v Reed [2009] NSWCA 280

FILE NUMBER(S):
40424 of 2008

HEARING DATE(S):
9 June 2009

JUDGMENT DATE:
7 September 2009

PARTIES:
Rados Sretenovic - First Appellant
Monica Sretenovic - Second Appellant
James Reed by his next friend Sharlene Sullivan - Respondent

JUDGMENT OF:
Beazley JA McColl JA    

LOWER COURT JURISDICTION:
District Court

LOWER COURT FILE NUMBER(S):
DC 5558 of 2007

LOWER COURT JUDICIAL OFFICER:
Levy SC DCJ

LOWER COURT DATE OF DECISION:
10 September 2008

LOWER COURT MEDIUM NEUTRAL CITATION:
[2008] NSWDC 202

COUNSEL:
RR Stitt QC with EE Beilby - Appellants
AS Morrison SC with AD Campbell - Respondent

SOLICITORS:
Sparke Helmore - Appellants
Gerard Malouf & Partners - Respondent

CATCHWORDS:
APPEAL AND NEW TRIAL – appeal – excessive damages – cost of future treatment and non-economic loss – review of conclusion as to plaintiff’s psychological condition – whether findings of fact unsupported by evidence – whether primary judge applied personal opinion as to potential for recovery
JUDGES AND COURTS – judicial obligation to make findings of fact on proved evidence
EVIDENCE – medical evidence – assessment of psychological condition of witness – assessment based on inadequate evidence
DAMAGES – measure of damages in actions for tort – personal injuries – future economic loss – considerations for the assessment of future loss of earning capacity in the case of a minor – whether buffer should be awarded

LEGISLATION CITED:
Civil Liability Act 2002 (NSW)
Civil Procedure Act 2005 (NSW)
Companion Animals Act 1998 (NSW)
Supreme Court Act 1970 (NSW)

CATEGORY:
Principal judgment

CASES CITED:
Abalos v Australian Postal Commission [1990] HCA 47; (1990) 171 CLR 167
Graham v Baker [1961] HCA 48; (1961) 106 CLR 340
Halvorsen Boats Pty Ltd v Robinson (1993) 31 NSWLR 1
Hornsby Shire Council v King [2005] NSWCA 67
K-mart Australia Ltd v McCann [2004] NSWCA 283
Leichhardt Municipal Council v Montgomery [2005] NSWCA 432
Penrith City Council v Parks [2004] NSWCA 201
Reed v Sretenovic & Anor [2008] NSWDC 202
State of New South Wales v Moss [2000] NSWCA 133; (2000) 54 NSWLR 536
Strinic v Singh [2009] NSWCA 15
Todorovic v Waller [1981] HCA 72; (1981) 150 CLR 402
Watts v Rake [1960] HCA 58; (1960) 108 CLR 158
Wynn Tresidder Management v Barkho [2009] NSWCA 149

TEXTS CITED:
American Medical Association Guides to the Evaluation of Permanent Impairment (5th ed)

DECISION:
1. Appeal allowed. 2. Judgment of the Court below set aside. 3. The parties should bring in Short Minutes of Order within 14 days setting out the sum to be awarded to the respondent on the basis of the above reasons. 4. Respondent to pay the appellants’ costs of the appeal.

JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA No: 40424/08
DC No: 5558/07

Beazley JA
McColl JA

Monday 7 September 2009

Rados Sretenovic & Anor v James Reed by his next friend Sharlene Sullivan

Judgment

  1. BEAZLEY JA:     I agree with…

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AGLC
Sretenovic v Reed [2009] NSWCA 280
Case
[2009] NSWCA 280
Decision Date

CaseChat Overview and Summary

The appeal concerned an assessment of damages for personal injuries suffered by the respondent, Mr Sretenovic, who was a minor at the time of the incident. The appellants, Mr and Mrs Reed, sought to appeal the judgment of the primary judge, arguing that the damages awarded were excessive, particularly in relation to the cost of future treatment and non-economic loss. The core of the appeal lay in whether the primary judge's findings of fact regarding the respondent's psychological condition were supported by the expert evidence presented.

The legal issues before the court were whether the primary judge erred in his assessment of the respondent's psychological condition and the consequent damages. Specifically, the appellants contended that the primary judge made findings of fact concerning the respondent's disabilities that were not supported by the opinions of the qualified psychiatrists, Associate Professor Quadrio and Dr Whan. They argued that the primary judge had improperly relied on his own personal opinion rather than the evidence presented, particularly in relation to the potential for the respondent's recovery and the severity of his ongoing psychological impairments.

The Court of Appeal allowed the appeal, setting aside the judgment of the court below. The Court found that the primary judge had either made findings of fact unsupported by the evidence or had applied his personal opinion regarding the respondent's psychological condition. The Court emphasised the fundamental judicial obligation to base findings of fact on proved evidence, citing principles from cases such as *Strinic* and *Saunders v Adderley*. It was held that a judge's personal experience, even in medical matters, does not replace the requirement to base findings on the evidence presented, and doing so constitutes an error of law and a breach of procedural fairness. The Court noted that Professor Quadrio's evidence, which the primary judge accepted, did not support the findings that the respondent's depression would worsen or that treatment prospects were poor. Instead, Professor Quadrio's opinion suggested that symptoms could be ameliorated with appropriate treatment, although the duration of that treatment might vary.

Consequently, the Court ordered that the appeal be allowed and the judgment of the court below be set aside. The parties were directed to bring in Short Minutes of Order within 14 days to determine the sum to be awarded to the respondent on the basis of the Court's reasons. The respondent was ordered to pay the appellants' costs of the appeal.

Orders

Orders of the court

1. Appeal allowed. 2. Judgment of the Court below set aside. 3. The parties should bring in Short Minutes of Order within 14 days setting out the sum to be awarded to the respondent on the basis of the above reasons. 4. Respondent to pay the appellants’ costs of the appeal.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Dr Meares did not believe the respondent’s scarring would prevent him from working to the age of 65. He believed that the respondent would be able to live a normal life and would not be significantly impaired, but may be impaired to the extent of the scarring of his right forearm.Psychiatrists’ evidence The principal area of controversy on appeal lay in the primary judge’s treatment of the psychiatric evidence. Both parties qualified psychiatrists to examine the respondent. The respondent qualified Associate Professor Carolyn Quadrio and the appellants qualified Dr Neville Whan. The primary judge (at [159]) preferred Professor Quadrio’s opinion to Dr Whan’s, whose written opinions he rejected. Dr Whan gave evidence. The primary judge rejected his oral evidence to the extent it contradicted Professor Quadrio’s opinions. The appellants do not cavil with the primary judge’s rejection of Dr Whan’s evidence. They submit their appeal is entitled to succeed on the basis of Professor Quadrio’s opinions. They contend that in assessing the damages he should award for non-economic loss and future economic loss, the primary judge made findings as to the respondent’s disabilities which were not supported by Professor Quadrio’s (or Dr Whan’s) opinions. Having regard to the appellants’ submission, it is important to set out Professor Quadrio’s opinion verbatim. It is set out under headings which presumably corresponded with those set out in the respondent’s solicitor’s letter requesting her opinion. (That letter was clearly in pro forma layout which bore no acknowledgement of the fact that the respondent was a schoolboy).“7. Assessment of condition.Chronic Post Traumatic Stress Disorder (DSM)Depression and Personality ChangeAs a direct result of the injury, James has developed Chronic Posttraumatic Stress Disorder (PTSD). He manifests the following features:He has recurrent dreams, flashbacks and reaction to triggers that remind him of the trauma and he avoids thoughts and situations that will trigger reactions. He has a numbing of responsiveness with a diminished capacity for relatedness and enjoyment and a shortened sense of the future. He now manifests a chronic low grade depressive adjustment. The latter might be termed an Adjustment Disorder with Depressed Mood, Chronic but the features of these disorders overlap considerably and it is not uncommon for PTSD to become complicated over time with chronic depressive symptoms.There is a further complication in that James has now manifested these symptoms over the critical years of personality development so that some of this depressive adjustment has become entrenched and characterological and may now constitute a degree of personality change that may be enduring. Thus, he is no longer as sociable, he is more self conscious, he is generally gloomy in his demeanour and more irritable than he was premorbidly.8. Nature and extent of any present or continuing disabilities. See above: fearfulness, diminished capacity for relatedness and enjoyment; chronic low grade depression; personality change, less sociable, more self conscious, more irritable.9. The nature and extent of any impairment.See above.10. Your opinion as to whether the claimant ought to be able to resume pre-accident occupation.His pre-accident occupation was that of school student and James has largely been able to return to school albeit with some diminution in his capacity for motivation, enjoyment, social interaction and participation in sport. However, his long term outlook in terms of occupational and social adjustment is compromised because of the psychological disturbances described.11. If unable to resume normal duties opinion as to when that may be expected. James is now able to attend school but in the long term he may have some limitations in terms of future career and social adjustment.12. If unable to resume normal duties opinion as to what duties may ultimately resume and when it might be expected.James does not have any clear ideas about a career path yet; it is unlikely that any physical disability will impede him in this respect but ongoing psychological difficulties may cause him to have difficulties in his overall psychosocial and occupational adjustment. His gloominess, lack of self confidence and general wariness will most likely diminish his chances of success in the career world as well as compromising his social well being.13. If your opinion is only able to return to restricted/light duties how many hours per week.James is able to attend school full time.14. As a result of permanent disability and an acceleration to the degenerative process will the claimant be able to work up until the age of 65. If not at what age will he.Not in my field of expertise but it appears unlikely that James will suffer any ongoing physical disability related to this accident. 15. Prognosis and any details of any recommended treatment.James has been quite seriously affected by this injury in that he has suffered more than a temporary post traumatic reaction – his symptoms have persisted and become chronic and, in particular, he now manifests a low grade depressive adjustment which suggests that he has undergone some personality change. That there has developed this chronic outcome suggests some lack of resilience – an innate factor which greatly influences the capacity of children to cope with trauma. Children with reasonable resilience can be expected to make a full recovery within two years – this has not been the case with James. If he does not make a complete recovery after a 12 months programme of treatment as outlined, then it is likely that he may continue with some residual psychological disability indefinitely. 16. Details of any recommended rehabilitation.James has had no psychological treatment thus far. His PTSD symptoms could be ameliorated with an appropriate treatment programme: a combination of medication – an SSRI antidepressant – and a course of cognitive behavioural psychological therapy. The more pervasive depression and possible personality change would require a longer period of psychological treatment.17. In terms of any future treatment or rehabilitation opinion as to duration of treatment, nature and if possible approximate cost.Cognitive behavioural therapy aimed at treating both PTSD phenomena and depressive symptoms should be provided by a clinical psychologist with appropriate expertise. If it were uncomplicated PTSD this would require six to 12 sessions over six to 12 months. However, his chronic depressive adjustment and indications of personality change, suggest that James may need a more extended period of psychotherapy, most likely weekly sessions over a period of 12 to 24 months. This would cost approximately $200 a session and Medicare would provide a rebate of around half that amount for up to 50 sessions a year; beyond that the fees would need to be met privately.Because of his age, antidepressant SSRI medication should only be prescribed by a child and adolescent psychiatrist working in conjunction with the clinical psychologist. Again if it were uncomplicated PTSD James would probably need to be seen at least six times over a 12 month period; but because of the depressive and personality issues, this might need to be a longer period – up to 24 months and twice that number of sessions. The cost would be between $200 and $250 a session and Medicare will rebate about half that amount.18. Opinion as to extent that ability to lead a normal life is significantly impaired by the injury.See above: ongoing psychological difficulties may cause him to have difficulties in his overall psychosocial as well as his occupational adjustment.19. Any other relevant observations.The mother’s history is also suggestive of some personality change.It is difficult to know exactly what determines a relative lack of resilience in one child and solid resilience in another.20. Requirements for past and future care, extent required and whether it is reasonable as a consequence of the injuries and disability.It may be necessary for James to have ongoing counselling aimed at improving his chronic depressive adjustment – this has been estimated at up to 24 months but occasionally can take three to five years.” (emphasis added)The primary judgment

Decision

Reasons for decision

Regrettably, in my view, the primary judge in this case appears either to have made findings of fact unsupported by evidence and/or (it matters not which) has applied his personal opinion concerning the respondent’s present and future psychological condition. Conclusions: the worsening depression and treatment issues The primary judge, as I have said, said (at [149]) that he accepted Professor Quadrio’s diagnoses and prognosis of the respondent’s psychological problem. The substance of Professor Quadrio’s first report (at [7]) was that the respondent had chronic post-traumatic stress disorder overlapping with Adjustment Disorder with Depressed Mood and a chronic low-grade depressive adjustment. These disorders were complicated by the fact they had been manifested over the critical years of the respondent’s personality development so that, as Professor Quadrio said, “some of this depressive adjustment has become entrenched and characterological and may constitute a degree of personality change that may be enduring.” (emphasis added). Under the heading “Present or Continuing Disabilities”, Professor Quadrio identified (inter alia) “personality change”. When Professor Quadrio came to consider the issue of the respondent’s prognosis, while she acknowledged the serious effect the injury had had on him, she also clearly contemplated that it was possible he could make a complete recovery after the 12-month programme of treatment she outlined. If he did not then it was “likely he may continue with some residual psychological disability indefinitely” (emphasis added). In her opinion the respondent’s PTSD symptoms could be “ameliorated” with an appropriate treatment programme while the “more pervasive depression and possible personality change would require a longer period of psychological treatment”. (emphasis added) Dealing with the respondent’s future employment, Professor Quadrio’s emphasis fluctuated. On the one hand she suggested, “his long term outlook in terms of occupational and social adjustment is compromised because of the psychological disturbances described”, however, in response to the next question, (clearly a pro forma one) relating to “his ability to resume normal duties”, pointed out that “in the long term he may have some limitations in terms of future career and social adjustment.” (emphasis added) That qualified response was repeated in answer to question 12 although Professor Quadrio did add that the respondent’s:“gloominess, lack of self confidence and general wariness will most likely diminish his chances of success in the career world as well as compromising his social well-being.” (emphasis added) Nowhere in Professor Quadrio’s reports did she say that the respondent’s depression might worsen (cf primary judgment at [167], [186(g)]). Nor, in my view, did Professor Quadrio’s reports support the primary judge’s findings that the prospects of psychological treatment for the respondent were poor ([166]) and had little prospect of succeeding ([167], [186(f)]). Rather, Professor Quadrio’s opinion was that the respondent’s PTSD symptoms “could be ameliorated with an appropriate treatment programme” (at [16]), although the duration of that programme might differ depending upon the psychological condition being treated (at [16]).

Ratio Decidendi

Legal Principle Established

Significantly, in my view, with the exception of seeking to justify the primary judge’s conclusion that the respondent suffered from major depression, the respondent did not point to evidence which would support the parts of the primary judge’s findings the appellants impugned.Consideration In Strinic, Beazley JA (Ipp and Basten JJA agreeing) considered the principles concerning judicial fact-finding in a case involving expert evidence. In that case, the primary judge (who had extensive judicial experience in personal injury litigation – see [62]) made findings of critical fact which Beazley JA concluded (at [127]) were based on his own medical knowledge. Her Honour explained the relevant principles as follows: “60 The fundamental judicial obligation to make findings of fact on proved evidence (not being matters of common knowledge or judicial knowledge) has been emphasised by the courts in a variety of different circumstances. In Saunders v Adderley [1999] 1 WLR 884, Sir John Balcombe, in delivering the judgment of the majority of the Privy Council, stated, at 889: ‘It is, of course, an error of law for a judge to make a finding of fact which there is no evidence to support, unless the matter is one of which the judge is entitled to take judicial notice.’See also Holland v Jones [1917] HCA 26; (1917) 23 CLR 149; ABC v Lenah Game Meats Pty Ltd [2001] HCA 63; 208 CLR 199; Coombes v RTA [2006] NSWCA 229; Ohlstein bht Ohlstein v E & T Lloyd t/as Otford Farm Trail Rides [2006] NSWCA 226. 61 In Ohlstein, Ipp JA observed, at [155], that the risk to a young child in undertaking a guided horse ride and a child’s ability to undertake the ride: “… should not be determined by a personal judicial opinion, based on common knowledge and experience, that differs from the opinions expressed by the experts … .”…64 Even if a particular judge sitting in a court of general jurisdiction is experienced in adjudicating medical cases, that experience does not replace the requirement to base findings on the evidence. A court cannot assume that its knowledge of any particular matter is correct, even if the individual judge has a great deal of experience dealing with, for example, medical issues, as was the case here. In Saunders v Adderley [1999] 1 WLR 884 it was said that such a process involved an error of law. Underlying that error is a fundamental breach of procedural fairness. A party is not afforded procedural fairness where a trial judge makes findings of fact based upon that judge’s own purported knowledge or understanding of matters that do not form part of the evidence. 65 I have put that proposition in blunt terms, because it is the underlying fundamental principle upon which courts must act. Procedural fairness does, however, take its colour and hue from the particular circumstances at hand. … a trial judge would be entitled to advise the parties that he understood certain medical evidence to have a particular meaning, even if that meaning was not stated in the evidence. If all parties agreed that the judge’s understanding on that matter was correct, then, the matter being transparent and not in dispute, there would be no breach of procedural fairness in the trial judge’s acting on that understanding.”