Stayte v Thompson

[2000] QCA 467

SUPREME COURT OF QUEENSLAND

CITATION:

Stayte & Ors v Thompson & Anor [2000] QCA 467

PARTIES:

JOHN MERVYN STAYTE
(first plaintiff/respondent)
SAMUEL SVEN STAYTE
(suing by his next friend JOHN MERVYN STAYTE)
(second plaintiff/not party to the appeal)
BENGT ROBERT STAYTE
(suing by his next friend JOHN MERVYN STAYTE)
(third plaintiff/not party to the appeal)
v
JOCELYN MARGARET THOMPSON
(first defendant/not party to the appeal)
SUNCORP INSURANCE AND FINANCE
(second defendant/appellant)

FILE NO:

Appeal No 4995 of 2000
SC No 12 of 1997

DIVISION:

Court of Appeal

PROCEEDING:

Personal Injury – Quantum Only

ORIGINATING COURT:

Supreme Court at Mackay

DELIVERED ON:

17 November 2000

DELIVERED AT:

Brisbane

HEARING DATE:

1 November 2000

JUDGES:

Davies and Pincus JJA, Byrne J
Separate reasons for judgment of each member of the Court, each concurring as to the orders made

ORDER:

Appeal allowed with costs to be assessed.  Judgment made on 11 May 2000 varied by substituting for $556,968.80 the sum of $308,768.80.

CATCHWORDS:

APPEAL AND NEW TRIAL – APPEAL – GENERAL PRINCIPLES – EXCESSIVE OR INADEQUATE DAMAGES – DAMAGES EXCESSIVE - where plaintiff had decided to cease regular employment prior to injury

Husher v Husher [1999] HCA 49; (1999) 197 CLR 138 applied

COUNSEL:

R F King-Scott for the appellant
The respondent appeared on his own behalf

SOLICITORS:

Barry Beaverson & Stenson (Mackay) for the appellant
The respondent appeared on his own behalf

1. DAVIES JA:  I agree with the reasons for judgment of Byrne J and with the orders he proposes.  I also agree with the additional reasons of Pincus JA.

1. PINCUS JA:   I have read the reasons of Byrne J.  There was, as his Honour points out, a lack of evidence in support of the view that had his wife not been injured in June 1994, the respondent could have been expected thereafter to earn substantial sums of money by his labours.  The onus was on the respondent to prove this and it was not proved.  In particular there was no evidence on which a rational assessment could be made of the likely profits (if any) from the respondent's boat building activities.  It was not, in my respectful opinion, right to fill in this serious gap in his evidence by a mere assumption that those activities would have been quite profitable.

1. I agree, substantially for the reasons given by Byrne J, that the appeal should be allowed and the judgment given by the learned primary judge varied in accordance with the proposal of Byrne J.

1. BYRNE J: This appeal concerns the economic loss components of an award of damages to the respondent, who suffered “nervous shock” in connection with severe injuries his wife sustained on 25 June 1994 that reduced her to a persistent vegetative state. Compensation for the consequential diminution in the respondent’s earning capacity was assessed at $100,000 to trial and $180,000 for the future. For the appellant, it is said that those allowances are manifestly excessive. They were arrived at in this way.

1. Had the respondent worked a 38 hour week in his former trade as a boiler maker from 1 July 1995 until trial, he would have earned about $101,590. But for “the events of 25 June 1994”, it was, said the judge, “more likely than not” that the respondent “would have earned from June 1994 onwards the equivalent of the wage he might have earned using his trade”. Making a small discount for adverse contingencies, the judge proceeded to allow $100,000 as the capital value of pre-trial diminution in earning capacity. As to the future, compensation was assessed on the basis that the respondent, aged 52 at trial, and who was “enjoying good health”,  would otherwise have worked for many years, deriving the equivalent of a boiler maker’s wage. At trial, that was $423 net per week, which, projected over 12 years, discounted at 5% per annum, yields a capital sum of about $200,000. That amount was reduced to $180,000 for “the usual contingencies”. The judge, considering that the respondent was unlikely to work again, did not value the possibility that he might yet earn some income from personal exertion.

1. The evidence, however, does not sustain such an approach.[1]

   [1]which makes it unnecessary to consider whether the judge failed to apply the principles expounded in Malec & J C Hutton Pty Ltd (1990) 169 CLR 638.

1. The respondent left school during grade 10. He completed an apprenticeship as a refrigeration mechanic. He then worked in the family hotel until the early 1970s when he went to England to work as a professional dirt bike rider. In 1973, in New Zealand, he was a plate welder at a power station. On returning to Australia, the respondent worked at his mother’s hotel and as a bus driver.

1. In early 1975, the respondent bought a boat. He sold it in the late 1970s. In 1978, he started to work in boat-building, doing repairs and maintenance at a slipway. At about this time, he began construction of a 36 foot ketch.

1. In the early 1980s, the respondent purchased earthmoving equipment. Thereafter, for some years he worked on an earthmoving sub-contractor. Throughout this period, he also laboured part-time at the slipway.

1. In the mid-1980s, the respondent and his brother inherited a block of 12 units in Mackay. His wife managed them, as well as other units the respondent had previously acquired.

1. In 1991, the respondent was diagnosed with colon cancer. He was treated surgically. Although chemotherapy was not required, the cancer made him “take a different look on life”. He decided to spend more time with his wife and sons; and he set about reorganizing his affairs. He ceased his contracting work, and was committed to not returning to it. With his wife, he acquired his brother’s interest in their units. Rental from that property became an important source of family income.

1. At the end of 1993, the respondent’s sons were 10 and 7. His wife decided to obtain  permanent employment as the boys reached secondary school. By early 1994 she had accepted a position as a part-time cleaner at a Mackay nursing home. She continued managing the home units.

1. As at 25 June 1994, when his wife’s accident supervened, the respondent had not returned to income-earning activity, and he had no plans to do so. By then he was, he said, no longer “ambitious”. Since his surgery in 1991, he had occupied himself constructing the hulls and decks of two ketches. As at June 1994, he anticipated completing the vessels in another year or so; and he hoped to sell one. Asked how he had seen his future shortly before his wife was injured, he then anticipated, he said, that he might have made three or four more ketches “if there was a demand for them” – a prospect he considered “speculative”. Another possibility was that he might in the years ahead have attended to “some small refits on boats or something like that”.

1. A statement of the respondent mentioned an intention in mid-1994 to seek work as a boat-builder after completion of the two ketches. The same statement asserted that, had it not been for the accident, he would have continued working full-time as a boat-builder, until trial and into the future. Those contentions were, however, distinctly at odds with his testimony – an account that presented a picture of a man who, for three years or so before the accident, had derived his income through property, occupied his time with building the two ketches, and had no intention to return to sub-contracting or employment. His testimony also revealed the absence of any financial or other incentive to resume gainful work from at least from the time his wife began her employment with the nursing home in early 1994.

1. In these circumstances, it was not appropriate to assess the damages on the footing that the respondent would, from June 1994, have earned the equivalent of a full-time tradesman. Instead, the chances that he might thereafter have derived income through personal exertion fell to be evaluated.[2] There is no precision in such an exercise; indeed it is largely guesswork. But difficulty in assessment cannot preclude an award of that capital sum which such evidence as there is indicates to be fair and reasonable compensation for the impairment of the respondent’s earning capacity resulting from his “nervous shock”.

   [2]cf Husher v Husher [1999] HCA 49; (1999) 197 CLR 138, 143, 146-147, 149.

1. The assessment must reflect these realities: that from 1991 the respondent had not wished to engage in income-earning work, had not done so, and in June 1994 appeared quite unlikely ever to work gainfully in future.

1. Of course, had his wife not been seriously injured in June 1994, the respondent might in the future have engaged in some remunerative activity. If family finances became stretched as, for example, were his wife to cease her employment, the respondent may have felt compelled to go out to work; or he might have made money from occasional boat repairs and the like. Allowance should be made for such contingencies, which seem not altogether devoid of value. More doubtful is the notion that the respondent might have made money from his ketch-building. No evidence was adduced to show that there was a market for this product, let alone to indicate that any sales might have yielded more than the production costs, excluding an allowance for the respondent’s labour.

1. The respondent has not completed the ketches under construction in mid-1994; and there seems little prospect that he will do.   The judge allowed the costs of materials used; and as the evidence did not demonstrate that either ketch might have been sold at a price greater than the aggregate expenditure to be incurred in its manufacture, no larger loss was proved in respect of this activity.

1. The value of the impairment of earning capacity in the approximately 6 years to trial is not proved to be greater than $20,000.  In respect of the future, a capital sum of $35,000 presents as adequate compensation.

1. In the result, the sum for which judgment was entered should be reduced by $248,200.

1. The appeal should be allowed with costs to be assessed, and the judgment varied by substituting for $556,968.80 the sum of $308,768.80.