Tuohey v Freemasons Hospital
[2012] VSCA 80
•4 May 2012
SUPREME COURT OF VICTORIA
COURT OF APPEAL
| S APCI 2011 0090 | |
| PATRICK TUOHEY | Plaintiff |
| v | |
| FREEMASONS HOSPITAL | Defendant |
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| JUDGES | REDLICH and MANDIE JJA and KYROU AJA |
| WHERE HELD | MELBOURNE |
| DATE OF HEARING | 16 February 2012 |
| DATE OF JUDGMENT | 4 May 2012 |
| MEDIUM NEUTRAL CITATION | [2012] VSCA 80 |
| CASE STATED IN MATTER | Tuohey v Freemasons Hospital (Unreported, County Court of Victoria, Judge Saccardo, 30 May 2011) |
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PERSONAL INJURY – Damages for economic loss – Case stated – Meaning of Wrongs Act 1958 (Vic) s 28F – Where plaintiff’s with injury and without injury weekly earnings exceed statutory cap – Whether statutory cap applies to final award of damages or part of process in assessing award – Legislative intent behind s 28F and Interpretation of Legislation Act1984 (Vic) s 35 – Interference with common law rights – Comparable statutory compensation provisions in other jurisdictions – Motor Accidents Compensation Act 1999 (NSW) s 125, Personal Injuries Proceedings Act 2002 (Qld) s 51.
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| Appearances: | Counsel | Solicitors |
| For the Plaintiff | Mr J Ruskin QC Ms B Y Knoester | Holding Redlich |
| For the Defendant | Mr J J Noonan SC Mr N Murdoch | Minter Ellison |
REDLICH JA:
This appeal is concerned with the correct interpretation of sub-s 28F(2) of the Wrongs Act 1958 (‘the Act’) in calculating damages with respect to past and future economic loss.
In proceedings before Judge Saccardo in the County Court, the plaintiff claimed damages from the defendant in respect of personal injuries suffered by him in 2005 in the course of treatment when he was an inpatient at the defendant’s hospital.
The plaintiff is an engineer in his late forties. He was admitted to the hospital managed and maintained by the defendant as a patient for the purposes of undergoing an umbilical hernia repair procedure. The defendant employed nursing staff to undertake the nursing and care of patients at the hospital. Shortly after the completion of the surgical procedure, a nurse employed by the hospital, acting within the course of her employment, aided the plaintiff to attempt to urinate. Having assisted the plaintiff to stand, the nurse momentarily absented herself from the plaintiff’s side to attend another part of the room. During that time the plaintiff collapsed and fell to the floor, sustaining injury to his right eye.
During a directions hearing, the parties made a joint application that the proceedings be adjourned and that the County Court reserve certain questions concerning the proper interpretation of sub-s 28F(2) of the Act in the form of a special case for the opinion of the Court of Appeal pursuant to sub-s 76(1) of the County Court Act 1958.
The parties agreed before his Honour that in the event that the plaintiff established an entitlement to damages against the defendant, an issue would arise as to the correct interpretation of sub-s 28F(2) in calculating the plaintiff’s entitlement to damages with respect to past and future economic loss. Judge Saccardo was informed that the issue was of such significance that there was no prospect that the parties would be able to resolve the case without a determination of the issue and that, were his Honour to rule upon the issue, the party adversely affected would appeal the point.
Judge Saccardo considered that it was in the interests of justice that he accede to the parties’ request and ordered that the following questions be referred for the opinion of the Court of Appeal:
(1)What is the correct interpretation of the expression ‘the Court is to disregard the amount (if any) by which the claimant’s gross weekly earnings would (but for the death or injury) have exceeded an amount that is 3 times the average weekly earnings’ in sub-section 28F(2) of the Wrongs Act?
(2)Does sub-section 28F(2) of the Wrongs Act require the Court to disregard:
(a)the amount by which the difference between the plaintiff’s ‘without injury’ earnings and the plaintiff’s ‘with injury’ earnings exceeds the sum of $2,836.50?
(b)the amount by which the plaintiff’s ‘without injury’ earnings exceeds the sum of $2,836.50?
Solely for the purpose of a formation of opinion by the Court of Appeal, the parties agreed upon a number of facts which relevantly included the following:
(i)that the proceedings constitute a claim for personal injury damages as defined in sub-section 28B of Part VB of the Act;
(ii)that ‘3 times the amount of average weekly earnings at the date of the award’ under sub-section 28F(2) is $2,836.50;
(iii) that the plaintiff’s ‘with injury earnings’ (the gross weekly amount that the plaintiff is able to earn after injury) were $6,442 and the plaintiff’s ‘without injury earnings’ (the gross weekly amount that the plaintiff would have been able to earn had the injury not occurred) were $10,548.52 for the financial year ended 30 June 2010;
(iv)over the entire period in respect of which the plaintiff claims damages for past and future economic loss, the plaintiff’s with and without injury earnings both exceed $2,836.50 (save for a period of five days immediately subsequent to the date of injury when the plaintiff’s with injury earnings were nil).
The relevant section is in the following terms:
28FDamages for past or future economic loss—maximum for loss of earnings etc.
(1) This section applies to an award of damages—
(a)for past economic loss due to loss of earnings or the deprivation or impairment of earning capacity; or
(b)for future economic loss due to the deprivation or impairment of earning capacity; or
(c) for the loss of expectation of financial support.
(2)In the case of any award to which this section applies, the Court is to disregard the amount (if any) by which the claimant's gross weekly earnings would (but for the death or injury) have exceeded an amount that is 3 times the amount of average weekly earnings at the date of the award.
(3)For the purposes of this section, the amount of average weekly earnings at the date of the award is—
(a)the amount per week comprising the amount estimated by the Australian Statistician as the average weekly total earnings of all employees in Victoria for the most recent quarter occurring before the date of the award for which such an amount has been estimated by the Australian Statistician and that is, at that date, available to the Court making the award; or
(b)if the Australian Statistician fails or ceases to estimate the amount referred to in paragraph (a), the prescribed amount or the amount determined in such manner or by reference to such matters, or both, as may be prescribed.
The section was introduced into the Act by the Wrongs and Other Acts (Public Liability Insurance Reform) Act 2002 (‘Amending Act’). Under sub-paragraph 1(a)(iii) of the Amending Act, one of the stated purposes of the legislation was ‘to limit the amounts that may be recovered as damages for death or personal injury caused by the fault of a person’.
The plaintiff contends that the quantum per week which the plaintiff may claim in respect of past or future economic loss is capped at 3 times average gross weekly earnings. The limit applies to the difference between ‘without injury’ and ‘with injury’ earnings, to the extent (if any), that the difference is in excess of that limit. The defendant contends the quantum of the plaintiff’s ‘without injury’ earnings is capped at 3 times average gross weekly earnings before the plaintiff’s ‘with injury’ earnings are deducted. Where the ‘with injury’ earnings exceed the capped ‘without injury’ earnings, the plaintiff will not have an entitlement to damages.
The plaintiff’s construction of sub-s 28F(2) gives primacy to the term of an ‘award’ of damages and requires ‘the amount’ of loss of the claimant’s earnings to be disregarded to the extent it exceeds the prescribed limit. His preferred construction treats the gross weekly earnings the claimant ‘would have’ received, but for the injury, as a hypothetical evaluation of lost future earning capacity rather than the claimant’s ‘without injury’ earnings.
Meaning of ‘award’ in sub-section 28F(2)
It was submitted that the reference to ‘any award’ regulated by sub-s (1) means an award of damages that has already been assessed by a court pursuant to common law principles and relevant legislation. This is based on the conclusion that sub-s (2) takes an ‘award’ of damages as its grammatical subject. The opening grammatical clause is in the terms of ‘In the case of any award’ described by sub-s (1). One dominant meaning of the word ‘case’ is that it relates to a singular ‘instance or example of the occurrence or existence of a thing.’[1] The award is also phrased in terms of the definite article in the closing words: ‘at the date of the award.’ On this basis, it was submitted that the subject of the sub-section is a definite award of the general type described in sub-s (1). Sub-section 28C(1), entitled ‘Application of Part’, also sets out that the relevant Part of the Act ‘applies to an award of personal injury damages, except an award that is excluded by sub-section (2).’
[1]Oxford English Dictionary (2nd ed., 1989).
Hence the plaintiff invites a construction of the term ‘award’ as meaning the end amount of the assessment of damages (presumably after an adjustment for vicissitudes of life) rather than the process of assessment of damages for economic loss. But other sections of the Act reveal differing uses of the term ‘award’, and its derivatives, which contemplate the process for assessing damages regulated by the respective sections. For instance, s 28I expressly regulates the calculation of damages forming a component part of a fully assessed lump sum ‘award of damages’.[2] The use of the term ‘an award’ does not in my view limit the operation of sub-s 28F(2) to the finalised or fully assessed award. When regard is had to the use of the term throughout the Act, and in the context of s 28F, it may also apply to the task of assessing damages and hence to a component of the assessment of the award. Significantly different language has generally been employed throughout the Act where the amount of damages that may be awarded is limited. Sections 19B (Calculation of damages for gratuitous care), 28IA (Limitation on damages for gratuitous attendant care), 28IB (Calculation of damages) and 28IE (Calculation of damages for gratuitous care), each prescribe limitations on, or methods of, calculation affecting component amounts of damages forming part of any finally and fully assessed ‘award’ of damages for personal injury or death.[3]
[2]See also s 28D (where the term ‘award’ is used as a verb, rather than a noun).
[3] During the course of oral submissions, the defendant relied on the decisions in Fkiarasv Fkiaras (2010) 77 NSWLR 468, 476 [37] and Doughty v Cassidy ([2005] 1 Qd R 462, 473 [43]), later discussed in these reasons, to reject the plaintiff’s contention that sub-s 28F(2) was only concerned with finalised and fully assessed ‘awards’.
Moreover, although the plaintiff accepted that the section involves no departure from the common law methodology of calculating economic loss, he did contend that the cap of 3 times average weekly earnings applies to the ‘lost’ weekly figure. If the lost ‘gross weekly earnings’ is to be derived from the end amount of the assessment of damages for economic loss, there would be an inversion of the usual method for assessing lost earning capacity in which the lump sum, adjusted for vicissitudes, is the end result of the assessment.[4] The language of the subsection does not reveal any intention that there be such an alteration to the common law method of assessment.
[4]The plaintiff did not explicitly state how the lump sum was calculated or how the weekly loss related to that lump sum. Ordinarily the lump sum requires allowance for the vicissitudes of life and involves an actuarial calculation to produce a present lump sum representing the claimant’s lost earning capacity: see for example Doughty v Cassidy [2005] 1 Qd R 462 (‘Doughty’); Fkiarasv Fkiaras (2010) 77 NSWLR 468, 472 [18] (‘Fkiaras’).
The meaning of the ’ amount’ of ‘weekly earnings’ to be disregarded
The plaintiff submitted that the ‘amount’ to be disregarded is the amount ‘of the loss’ arrived at after deducting weekly ‘with injury’ earnings from weekly ‘without injury’ earnings, to the extent (if any) that the amount of the loss exceeds 3 times average weekly earnings. Effectively, the words ‘of the loss’ are to be read into the provision after the word ‘amount’ where it first appears, so that the claimant’s ‘gross weekly earnings’ refers to that loss calculated as hypothetical lost future gross weekly earnings to which the prescribed limit applies. Such a meaning was also said to be supported by the fact that sub-s 28F(1) is focused on awards for past and future economic loss and loss of expectation of financial support which points to the ‘amount’ meaning the amount of such economic loss. That the ‘amount’ to be disregarded bears this meaning is further reinforced, it was submitted, by the heading that describes s 28F in terms of setting a ‘maximum for loss of earnings’ and ‘damages for past or future economic loss’.
The plaintiff’s construction would entitle him to significantly less compensation than he would have received at common law, free from the restriction in sub-s 28F(2). It nonetheless entitles him to limited compensation for economic loss. For the purposes of this appeal, the plaintiff’s weekly earning capacity ‘without injury’ was in the order of $10,550.00. Since incurring the injuries, his earning capacity reduced to about $6,450.00 per week. It follows that the weekly loss to the plaintiff is in the order of $4,100.00. On the plaintiff’s construction, the assessed award would then be subjected to the limitation under sub-s 28F(2), and the Court would be obliged to disregard the amount of about $1,270.00, being the amount by which the plaintiff’s assessed award exceeded the prescribed limit of $2,836.50. On the defendant’s construction, the plaintiff was not entitled to any portion of the loss that he could have recovered at common law as he has (both a ‘without injury’ and) a residual ‘with injury’ earning capacity which exceeds 3 times average weekly earnings.
Where the words of a statute are clear, so too is the task of a court in interpreting the statute.[5] The words in sub-s 28F(2), construed literally and in light of their widespread common law usage, do not convey the meaning advanced by the plaintiff. Parliament must be taken to know the law[6] which includes the common law methodology ordinarily employed for assessing economic loss for death or personal injury caused by tort. In Fkiaras v Fkiaras, Tobias JA, with whom Hodgson and MacFarlane JJA agreed, referred with approval to the approach adopted by the primary judge who had noted that in a straightforward case of calculation of economic loss the Court was ordinarily required to:
(a) assess probable [net] weekly earnings but for the injury;
(b) assess post-accident earnings and/or residual earning capacity;
(c)award damages based on the difference between (a) and (b) adjusted for vicissitudes.[7]
[5]Maunsel v Olins [1975] AC 373, 390–391 (Lord Simon of Glaisdale, with Lord Diplock agreeing).
[6]See for example R v Morton [1986] VR 863, 867 (Young CJ, King and Beach JJ).
[7](2010) 77 NSWLR 468, 472 [18].
The basis for assessing loss of earning capacity requires a comparison of ‘before’ or ‘without injury’ earnings and ‘after’ or ‘with injury’ earnings.[8] It is necessary to identify both what capacity has been lost and what economic consequences will probably flow from that loss. Only then will it be possible to assess what sum will put the plaintiff in the same position he or she would have been in if the injury had not been sustained.[9] It was not disputed on the appeal that this is the method by which loss of earning capacity is ordinarily calculated at common law. As the plurality judgment in Medlin v The State Government Insurance Commission observes:
the plaintiff would be prima facie entitled to recover as damages for loss of earning capacity the difference between what he would have earned during those four and one half years in his University appointment and any amount which notwithstanding his reduced earning capacity, he had earned or could reasonably be held capable of earning during that period.[10]
[8]Kallouf v Middis[2008] NSWCA 61.
[9]Ibid [46]–[48] (McColl JA and Hall J).
[10](1994–5) 182 CLR 1, 6 (‘Medlin’).
The terminology employed in paragraphs 28F(1)(a) and (b) and sub-s (2) is to be considered in this light. ‘Gross weekly earnings … (but for the death or injury)’ in sub-s (2) refers to ‘without’ or ‘before’ injury earnings – being the first component in the process for assessing damages at common law. It follows that it is this component in the process for assessing damages that is subject to the cap of 3 times weekly earnings. The reasonable confines of the language, and the use of the term ‘earnings’, cannot accommodate the plaintiff’s interpretation that ‘gross weekly earnings’ in sub-s 28F(2) means a future or hypothetical lost weekly earning capacity.
The ordinary meaning of ‘earnings’ is more apt to denote earnings that have already materialised, rather than a projected earning capacity in the future.[11] McHugh J said in Medlin ‘the loss of earning capacity principle more accurately compensates a plaintiff for the effect of an accident on the plaintiff’s ability to earn income.’[12] Whilst at common law it is a loss of this capacity to earn which is to be compensated, rather than a loss in earnings,[13] a demonstrable loss in past earning capacity is generally referred to, and manifested in, lost ‘earnings’.[14] The term ‘earnings’ in sub-ss 28F(1) and (2) has a plain meaning that is reflected in this common law usage of the word – where it is generally employed with reference to actual past earnings rather than lost future earning capacity. Paragraph 28F(1)(a), dealing with past economic loss, refers to ‘past economic loss due to loss of earnings or the deprivation or impairment of earning capacity’ (emphasis added). Paragraph 28F(1)(b), dealing with future economic loss, only refers to ‘future economic loss due to deprivation or impairment of earning capacity.’ The reference to ‘earnings’ in paragraph 28F(1)(a) only, relates to the weekly earnings received by a claimant or already lost by the claimant – both of which can be quantified ex posto facto – and not the future lost earning capacity that is projected and often hypothetical. Such a meaning is in conformity with the widespread usage of the term ‘earnings’ at common law and in ordinary language.
[11]‘Earnings: noun; plural: money earned:’ The Australian Concise Oxford Dictionary (2nd ed., 1995). See also Oxford English Dictionary (2nd ed., 1989): ‘Earning: concretely in plural: The amount of money which a person acquires or becomes entitled to by his labour; also, the income produced by invested capital’.
[12](1994-5) 182 CLR 1, 16.
[13]Graham v Baker (1961) 106 CLR 340, 346–7 (Dixon CJ, Kitto and Taylor JJ).
[14]See for example Doughty [2005] 1 Qd 462, 471 [36]; Fkiaras (2010) 77 NSWLR 468, 476 [46].
Furthermore, unless there is some statutory provision to the contrary, common law damages for negligence are usually awarded by way of a lump sum and not periodic payments.[15] There is no statutory indication that this approach is to be displaced in s 28F. The Explanatory Memorandum of the Bill to the Amending Act, free from the ambiguity of the Parliamentary debates (as hereafter discussed), contemplates the application of this common law principle and the use of common law terminology in s 28F. It explains the purpose of the provision in a way more consistent with the defendant’s preferred construction:
New section 28F restricts awards of damages for loss of earnings. Such awards are calculated as a lump sum, based on the weekly earnings that the claimant would have enjoyed but for the injury. The section restricts the maximum amount of weekly earnings from which the lump sum is calculated to not more than 3 times average weekly earnings, as determined by the Australian Statistician.[16]
[15]Doughty [2005] 1 Qd R 462, 470 [33].
[16]Explanatory memorandum, Wrongs and Other Acts (Public Liability Insurance Reform) Bill 2002 (Vic) cl 7 (emphasis added).
There is no reason why the Court should depart from the literal meaning of the words in sub-s 28F(2), being one which also accords with their usage at common law. The ‘amount’ to be disregarded in sub-s 28F(2) is that part (if any) of the first component in the common law process of assessing damages for economic loss – namely the ‘before’, ‘without’ or ‘but for’ injury earnings component which exceeds the capped amount. From that resultant figure, the ‘after’ or ‘with injury’ earnings of the claimant are deducted and a lump sum calculated in order to determine the loss of earning capacity. This interpretation conforms with the purpose of the sub-section as explained in the Explanatory Memorandum.
Legislative intent behind sub-section 28F(2)
The duty of the Court is to give the words the meaning that the Legislature is taken to have intended them to have.[17] The plaintiff submitted that even if there is no literal ambiguity in the sub-section, the Court should consider Parliamentary materials because his preferred construction of the sub-section is more conducive to the legislative intent than the defendant’s.[18] Relevantly, passages from the second reading speech include:
[17]Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355, 384 [78] (McHugh, Gummow, Kirby and Hayne JJ); Slaveski v Smith and Victoria Legal Aid [2012] VSCA 25 [20], [24] (Warren CJ, Nettle and Redlich JJA); Bennion, Statutory Interpretation (3rd ed, 1997), 343–344.
[18]Section 35(a) of the Interpretation of Legislation Act 1984; Mills v Meeking (1990) 169 CLR 214, 235 (Dawson J).
This bill continues the government's wide-ranging response to problems in the insurance sector that have impacted on all sectors of the Victorian economy and community.
An insurance sector is vital to the performance of the Victorian economy and the security of our community. Without insurance, a lot of economic, social and community activity would not take place.
The government's objective is to ensure insurance is available and affordable for business and the wider community, to protect Victoria's reputation as a good place to live and do business.
…
The major components of the Victorian government's response to problems in the insurance sector are as follows:
First, the government is making useful information available to insurers and consumers so they can make informed decisions. Potential new insurers will be provided with information on claims, premiums and profitability, making it easier for them to enter the Victorian market.
…
Finally, the government is introducing a comprehensive range of legislative reforms, including tort reform, to tackle a range of areas that over the longer term have put upward pressure on insurance prices.
…
This bill includes:
…
creating a cap on loss of earnings of 3 times average weekly earnings;
creating a cap on non-economic losses of approximately $370 000; and
…
Caps on certain heads of damages
The introduction of caps in this bill provides increased certainty to the public liability insurance market. They define potential claimants' rights more clearly in terms of their potential claim while also providing insurers with greater certainty with respect to potential claim costs.
…
It is appropriate that a reasonable limit be imposed on the amount of damages for loss of future earnings that can be awarded by a court. This bill imposes a limit of 3 times average weekly earnings. This is a high level of earnings enjoyed by only a few per cent of the Australian population. A cap at this level will therefore apply to only a few per cent of successful plaintiffs.[19]
[19]Victoria, Parliamentary Debates, Legislative Assembly, 4 October 2002, 140–142 (Steven Bracks, Premier).
The opposition member for Box Hill made the following comments, among others, in response:
The next set of provisions to which I will refer are those that limit the damages payable for loss of earnings to 3 times average weekly earnings.
Those provisions are set out in clause 7 of the bill in proposed section 28F(1), which is to be inserted into the Wrongs Act. Those provisions will not apply to awards of damages in proceedings commenced in a court before the commencement day of the legislation, which is the day on which it comes into operation. The provisions, as I say, will limit the maximum amount of damages that can be paid in respect of loss of earnings to 3 times average weekly earnings.
This will not have a major impact in reducing premiums, as it is only going to be relevant where the plaintiff is earning currently or is expected to earn in the future more than 3 times the average weekly earnings, which currently amounts to around $2700 a week. However, the provision reflects the proposition that the defendant should not be held responsible for an unusual level of loss above the cap level, and of course it has the consequence that people will have to take their own steps to protect themselves against loss of earnings greater than 3 times average weekly earnings.
The Liberal Party agrees in principle with this measure.[20]
[20]Ibid 285–286 (Robert Clark, Member for Box Hill).
On either party’s construction of the relevant provision, the legislative objective to aid the insurance industry is promoted. In both instances, burdens on insurance providers are likely to reduce in scenarios involving economic loss for high-income earners. In both instances, insurance providers are given greater certainty with respect to the potential maximum limits of liability relating to awards for damages for economic loss. The financial interests of the insurance industry may be further assisted by the defendant’s construction as a limited number of claimants would be deprived of any right to compensation for economic loss as a consequence of their ‘with injury’ earning capacity exceeding the capped amount. The Parliamentary material that the plaintiff pointed to is ambiguous and consistent with either party’s preferred construction. Unlike the recently amended Commonwealth Acts Interpretation Act 1901,[21] a construction which ‘will best achieve’ the object of the Act is not required under s 35(a) of the Interpretation of Legislation Act1984 (Vic), which calls for ‘a limited choice between ‘a construction that would promote the purpose or object [of the Act]’ and one ‘that would not promote that purpose or object.’’[22] Each party’s preferred construction serves at least some of the purposes identified. Accordingly, it would not be inconsistent with the purposive approach embodied in s 35(a) of the Interpretation of Legislation Act 1984 to prefer either party’s construction of sub-s 28F(2).
[21]Section 15AA of the Acts Interpretation Act 2011 (Cth) was amended in June 2011 to provide that the interpretation which best achieves the purpose is to be preferred.
[22]Chugg v Pacific Dunlop Ltd (1990) 170 CLR 249, 262 (Dawson, Toohey and Gaudron JJ, with Brennan J and Deane J agreeing).
While a construction that would promote the purpose or object underlying an Act shall be preferred to a construction that would not promote that purpose or object, the ordinary meaning of the words and their grammatical construction do not contradict the apparent purpose of the enactment. There is no disconformity between the language of sub-s 28F(2) and its purpose, or that of the Act as a whole, which would support a departure from a literal interpretation. The purposive approach to legislation does not justify giving the words of a contested provision an unnatural or unreasonable meaning,[23] even where that provision may be broadly remedial in form.[24]
[23]Macalister v R (1990) 169 CLR 324, 330 (Mason CJ, Dawson, Toohey, Gaudron and McHugh JJ); Slaveski v Smith and Victoria Legal Aid [2012] VSCA 25 [24] (Warren CJ, Nettle and Redlich JJA).See generally Pearce and Geddes, Statutory Interpretation in Australia (6th ed., 2006) [2.12]–[2.13], [2.29]–[2.30].
[24]IW v City of Perth (1997) 191 CLR 1, 12 (Brennan CJ and McHugh J , with Dawson and Gaudron JJ and Gummow J agreeing in the result; Toohey J and Kirby J dissenting). See also Pearce and Geddes Statutory Interpretation in Australia (6th ed., 2006) [9.2] (and the authorities cited therein).
Presumption against interfering with common law rights
The plaintiff also relies on the fact that his construction is more consistent with the interpretive presumption that legislation should be given a meaning that minimises, if not avoids, alteration, invasion of, or interference with, common law rights.[25] The presumption is said to apply as the defendant’s interpretation sets a ceiling for economic loss for high-income earners which results in a greater invasion of a claimant’s common law rights to a head of damages for tortuous wrong.
[25] James Spigelman, “The principle of legality and the clear statement of principle” (2005) 79 Australian Law Journal 769; Pearce and Geddes, Statutory Interpretation in Australia (6th ed., 2006) [5.23]–[5.30] (and the cases cited therein).
However, the presumption does not require a departure from the ordinary meaning of the words. It is susceptible to displacement in the face of express words or by necessary implication.[26] If sub-s 28F(2) is given its apparent meaning, the plaintiff’s common law rights must be invaded to the extent submitted by the defendant. The displacement of the presumption is evident by the unmistakable language of the provision countenancing an intent to rebut the presumption. If the presumption were not displaced, the ‘amount’ by which the claimant’s ‘without injury’ gross weekly earnings exceeded the limit in the sub-section would become meaningless and inoperative for the reasons advanced above.[27] Other words in the section, such as the parenthetical reference to ‘(but for the injury or death)’, would also become superfluous.[28]
[26]Pyneboard Pty Ltd v Trade Practices Commission (1983) 152 CLR 328, 341 (Mason ACJ, Wilson and Dawson JJ, with Murphy J and Brennan J dissenting); Pearce and Geddes, Statutory Interpretation in Australia (6th ed., 2006) [5.3].
[27]See above [17]–[22].
[28]See Project Blue Sky Inc v Australian Broadcasting Authority (91998) 194 CLR, 382 [71] (McHugh, Kirby, Gummow and Hayne JJ; Brennan CJ dissenting in the result); Legal Services Board v Cillespie-Jones [2012] VSCA 68, [27] (Nettle, Redlich and Hansen JJA); Pearce and Geddes, Statutory Interpretation in Australia (6th ed., 2006) [2.22].
The displacement of the presumption is also warranted because of the nature of the common law rights altered by sub-s 28F(2) which deals with a claimant’s right to a head of damages in tort. If the relevant right at common law is not fundamental, the extent of the protection afforded by the presumption against its alteration may be attenuated.[29] In Gifford v Strang Patrick Stevedoring Pty Ltd, the High Court considered the impact of provisions of the Law Reform (Miscellaneous Provisions) Act 1944 (NSW) and the Workers Compensation Act 1987 (NSW) on abolishing the common law right to damages for nervous shock.[30] The approach to statutory interpretation in that case has some resonance in this case given that the defendant’s construction of sub-s 28F(2) also purports to, in effect, abolish a common law right to a head of damages in tort for a limited number of claimants. Despite the considerable differences in the wording, context and history of the relevant sections in Gifford, the following remarks of McHugh J remain pertinent:
… nowadays legislatures regularly enact laws that infringe the common law rights of individuals. The presumption of non-interference is strong when the right is a fundamental right of our legal system; it is weak when the right is merely one to take or not take a particular course of action. Courts should not cut down the natural and ordinary meaning of legislation evincing an intention to interfere with these lesser rights by relying on a presumption that the legislature did not intend to interfere with them. Given the frequency with which legislatures now abolish or amend ‘ordinary’ common law rights, the ‘presumption’ of non-interference with those rights is inconsistent with modern experience and borders on fiction …
The right to bring an action for psychiatric injury is an ordinary legal right. It is not a fundamental right of our society or legal system similar to the right to have a fair trial or to have a criminal charge proved beyond reasonable doubt.[31]
[29]Bropho v State of Western Australia (1990) 171 CLR 1, 18 (Mason CJ, Deane, Dawson, Toohey, Gaudron and McHugh JJ); Maunsel v Olins [1975] AC 373, 394–395 (Lord Simon of Glaisdale, with Lord Diplock agreeing); James Spigelman, “The principle of legality and the clear statement of principle” (2005) 79 Australian Law Journal 769, 777–778.
[30](2003) 214 CLR 269 (Gleeson CJ, McHugh, Gummow, Kirby, Hayne and Callinan JJ) (‘Gifford’).
[31]Ibid 284. See also Malika Holdings v Stretton (2001) 204 CLR 290, 298–299 [28]–[30] (McHugh J, with Gleeson CJ, Gummow and Callinan JJ and Kirby J agreeing in the result).
The thrust of various sections in the Act, including the section (28G) immediately following s 28F, is to alter, limit and or invade common law rights in tort. Arguably, the extensive legislative inroads into the assessment of damages for tortuous conduct, suggest that the plaintiff’s right to damages for economic loss at common law is a lesser right which no longer attracts the same degree of protection it was once afforded.[32] Whether or not that be so, a comparison of sub-s 28F(2) with other parts of the Act indicate that the presumption against interfering with common law rights is not particularly strong in relation to damages for future economic loss. For instance, ss 47 (Part X Negligence), 71 (Part XI Mental Harm), 82 (Part XII Public Authorities), 14B(2) (Part IIA Occupier’s liability) and 14F (Part IIB Intoxication and Illegal Activity) each expressly state that the common law is not to be regarded as affected by the provisions of the relevant Part save to the extent provided for in the Part.[33] The last of these, s 14F, was introduced by the same Amending Act that introduced sub-s 28F(2) into the Act. No such reservation of the common law is made in Part III (which includes sub-s 28F(2)). That further supports the conclusion that sub-s 28F(2) is not to be construed with the same restraint regarding interference with common law rights.[34] Moreover, it is not in issue that however sub-s 28F(2) is construed, it involves a degree of interference with the right to recover damages for economic loss.
[32]James Spigelman, “The principle of legality and the clear statement of principle” (2005) 79 Australian Law Journal 769, 777–778.
[33]Contra s 14B(1) in relation to Part IIA (Occupier’s Liability) and s 33 in relation to Part VIII (Liability for negligence animals on highway).
[34]See for example the maxims expressum facit cessare tacitum and expressio unius est exclusion alterius discussed in Bennion, Statutory Interpretation (2nd ed., 1992), 872-885; and Pearce and Geddes Statutory Interpretation in Australia (6th ed., 2006) [4.28]–[4.31].
Comparable provisions in other jurisdictions
The defendant’s construction is supported by judicial decisions regarding similarly worded provisions in different interstate Acts that have also subjected the general law principles for calculating economic loss to statutory amendment. An example of a provision similar to sub-s 28F(2) is s 125 of the New South Wales Motor Accidents Compensation Act 1999 (‘Motor Accidents Compensation Act’). The relevant section was enacted as part of the original Act, which was passed against the backdrop of concerns regarding the insurance industry,[35] similar to some of those arising in the Victorian Parliamentary debates fuelling the Amending Act. Section 125 of the Motor Accidents Compensation Act provides:
[35]New South Wales, Parliamentary Debates, Legislative Council, 3 June 1999, 901–906 (John Della Bosca, Special Minister of State and Assistant Treasurer).
(1) This section applies to an award of damages:
(a)for past or future economic loss due to loss of earning or the deprivation or impairment of earning capacity, or
(b) for the loss of expectation of financial support.
(2)In the case of any such award, the Court is to disregard the amount (if any) by which the injured or deceased person’s net weekly earnings would (but for the injury or death) have exceeded $2,500.00.[36]
[36]The amount of $2,500.00 is indexed in relation to average weekly total earnings of full time adults in New South Wales: s 146 of the Motor Accidents Compensation Act.
The section was engaged where a court was assessing damages at common law for the loss or impairment of earning capacity. In Fkiaras the Court of Appeal held that sub-s 125(2) did not provide a cap on the award of past and future economic loss: it merely placed a cap on the first component of the process – namely, the assessment of probable weekly earnings but for the injury.[37] It is likely that the Parliamentary draftsman drew upon the form of sub-s 125(2) of the Motor Accidents Compensation Act in drafting s 28F of the Act.[38] While it is necessary to consider the meaning of s 28F within its own statutory context and having regard to
its own terminology and purpose, such considerations serve only to confirm that sub-s 28F(2) bears the same meaning as its counterpart in the New South Wales Act.
[37](2010) 77 NSWLR 468, 476 [37], 477 [45].
[38]I note that Fkiaras was not decided until after the commencement of sub-s 28F(2) of the Act.
The defendant also relied on the decision of McMurdo J in Doughty v Cassidy.[39] That case involved the construction of s 51 of the Personal Injuries Proceedings Act 2002 (Qld) which provided:
[39][2005] 1 Qd R 462.
(1)In assessing damages for loss of earnings, including in a dependency claim, the Court must disregard earnings above the limit fixed by subsection (2).
(2) The limit is 3 times average weekly earnings per week.
(3) In this section –
‘dependency claim’ means a claim in relation to fatal injury brought on behalf of a deceased’s dependants estate
‘loss of earnings’ means –
(a)past economic loss due to loss of earnings or the deprivation or impairment of earning capacity; and
(b)future economic loss due to loss of prospective earnings or the deprivation or impairment of prospective earning capacity.
McMurdo J citing with approval[40] the decision of Hodgson JA, with McColl JA and Cripps AJA agreeing, in Kaplantzi v Pascoe[41] – a precursor to the decision in Fkiaras – commented that there was no material difference between s 51 of the Personal Injuries Proceedings Act 2002 (Qld) and s 125 of the Motor Accidents Compensation Act.[42] It is unnecessary to decide the similarities or differences between the sections, save as to say that there is a similarity between the Queensland and New South Wales legislation and the wording of sub-s 28F(2) of the Act, and that the similarity is more pronounced in the latter instance.
[40]Ibid 471–472 [38].
[41][2003] NSWCA 386 (‘Kaplantzi’).
[42]Doughty [2005] 1 Qd R 462, 473–474 [44]–[46]. See also Fkiaras (2010) 77 NSWLR 468, 476 [40]–[41] (Tobias JA, with Hodgson and MacFarlan JJA agreeing).
The decisions in Fkiaras, Doughty and Kaplantzi do not determine the precise issues before this Court. While the views expressed in those cases may provide some guidance on the construction of s 28F, they do not bind this Court regarding the interpretation of an entirely different piece of legislation.[43] However, insofar as the literal meaning of sub-s 28F(2) is concerned, the sound judicial interpretation of almost identical wording in s 125 of the Motor Accidents Compensation Act is supportive of the defendant’s submissions.
[43]See generally Pearce and Geddes, Statutory Interpretation in Australia (6th ed., 2006) [1.6]–[1.10].
Answers to case stated
For the reasons stated, sub-s 28F(2) must be construed as the defendant contends. I would determine the case stated by answering the questions as follows:
(1) The Court is to disregard that portion of the plaintiff’s without injury earnings as exceed 3 times the average weekly earnings at the date of the award.
(2) (a) No.
(b) Yes.
MANDIE JA:
I agree with Redlich JA.
KYROU AJA:
I also agree with Redlich JA.
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