Verryt v Schoupp

[2015] NSWCA 128

Court of Appeal

Supreme Court

New South Wales

• Summary available

Medium Neutral Citation:

Verryt v Schoupp [2015] NSWCA 128

Hearing dates:

31 March 2015

Decision date:

15 May 2015

Before:

Meagher JA at [1];
Gleeson JA at [92];
Sackville AJA at [93]

Decision:

1.  Appeal allowed in part.
2.  Set aside the verdict and judgment of the District Court ordered on 15 April 2014.
3.  Verdict and judgment for the respondent (plaintiff) against the appellant (defendant) in the sum of $1,679,417.
4.  Order that the judgment in order 3 takes effect on 15 April 2014.
5.  Order the respondent pay 90% of the appellant’s costs of the appeal.

Catchwords:

TORTS – negligence – Motor Accidents Compensation Act 1999 (NSW) – injuries arising from child “skitching” (riding a skateboard whilst being towed by a vehicle) – findings as to contributory negligence of 12 year old boy under s 5R of the Civil Liability Act 2002 (NSW) – whether primary judge erred in apportioning responsibility wholly to the driver

TORTS – negligence – Motor Accidents Compensation Act 1999 (NSW) – damages for future economic loss – where damages assessed on basis that most likely future circumstance (s 126) would have been employment as a tradesman – where damages adjusted to include lump sum representing value of lost opportunity to earn higher income in self-employment – whether s 126 permitted such an award – whether adjustment for lost opportunity to earn higher income manifestly excessive

EVIDENCE – admissibility – relationship between ss 79 and 80 of the Evidence Act 1999 (NSW) – “expert” evidence as to matters within ordinary or common experience – whether opinions as to ordinary behaviour of children “based” on specialised knowledge

Legislation Cited:

Civil Liability Act 2002 (NSW), ss 5D(1), 5R
Evidence Act 1995 (NSW), ss 79, 80
Law Reform (Miscellaneous Provisions) Act 1965 (NSW), s 9(1)
Motor Accidents Act 1988 (NSW), s 74
Motor Accidents Compensation Act 1999 (NSW), s 138

Cases Cited:

Boral Bricks Pty Ltd v Cosmidis (No 2) [2014] NSWCA 139
British Fame (Owners) v Macgregor (Owners) [1943] AC 197
Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd [2007] FCAFC 70
Campbell v R [2014] NSWCCA 175
Dasreef Pty Ltd v Hawchar [2011] HCA 21; 243 CLR 588
Davis v Swift [2014] NSWCA 458
Director of Public Prosecutions v United Telecasters Sydney Ltd [1990] HCA 5; 168 CLR 594
Gordon v Truong; Truong v Gordon [2014] NSWCA 97
Grills v Leighton Contractors Pty Limited [2015] NSWCA 72
Kollas v Scurrah [2008] NSWCA 17
Malec v JC Hutton Pty Ltd [1990] HCA 20; 169 CLR 638
March v E & M H Stramare Pty Ltd [1991] HCA 12; 171 CLR 506
McHale v Watson [1966] HCA 13; 115 CLR 199
Mikaera v Newman Transport Pty Ltd [2013] NSWCA 464
Nicholson v Nicholson (1994) 35 NSWLR 308
Nominal Defendant v Rooskov [2012] NSWCA 43
Pennington v Norris [1956] HCA 26; 96 CLR 10
Podrebersek v Australian Iron & Steel Pty Ltd [1985] HCA 34; 59 ALJR 492
Penrith City Council v East Realisations Pty Limited (in liq) [2013] NSWCA 64
R v Turner [1975] 1 QB 834
Sharpe v Gordon; QBE Workers Compensation (NSW) Ltd v Gordon [2006] NSWCA 347
State of NSW v Moss [2000] NSWCA 133; 54 NSWLR 536
T and X Company Pty Ltd v Chivas [2014] NSWCA 235
Transport Publishing Co Pty Ltd v Literature Board of Review [1956] HCA 73; 99 CLR 111
Velevski v The Queen [2002] HCA 4; 76 ALJR 402

Texts Cited:

Australian Law Reform Commission, The Opinion Rule and its Exceptions (Report 102, February 2006)
Australian Road Rules

Category:

Principal judgment

Parties:

Alphonse Verryt (Appellant)
Liam Luke Schoupp (Respondent)

Representation:

Counsel:
P Deakin QC with D Rozani (Appellant)
D Campbell SC with S Longhurst (Respondent)

Solicitors:
Curwoods Lawyers (Appellant)
RMB Compensation Lawyers (Respondent)

File Number(s):

2014/142921

 Decision under appeal 

Court or tribunal:

District Court of New South Wales

Jurisdiction:

Civil

Citation:

[2014] NSWDC 28 and [2014] NSWDC 29

Date of Decision:

14 April 2014

Before:

Levy DCJ

File Number(s):

2009/339964 Wollongong

Judgment

1. MEAGHER JA: On 30 January 2007 the respondent sustained serious head injuries in circumstances which answered the description of a “motor accident” within the meaning of the Motor Accidents Compensation Act 1999 (NSW) (the MAC Act). For that reason the provisions of that Act, including in relation to contributory negligence, applied to his claim for damages against the appellant driver.

The circumstances of the accident

2. In the evening on that day the respondent and two other boys were sitting on the side of Hillcrest Avenue, Woonona with their skateboards. Those other boys were aged 16 and 15 and the respondent, the youngest, was two months off turning 13. That avenue proceeded up a slight hill, in an east-west direction, with the hill at its western end. The bitumen road surface was smooth. The appellant was driving along Hillcrest Avenue in a westerly direction. His son, who was a good friend of the other three boys, was sitting in the front seat of the car, a Subaru Liberty station wagon. The appellant stopped and was persuaded by the boys, other than the respondent, to allow the three with skateboards, including the respondent, to “skitch” a ride up the hill by holding on to the boot latch at the back of the vehicle whilst on their skateboards. They did that by positioning their hands, fingers facing upwards, under that latch, which was “a little bit wider than a number plate”. After the respondent and the other two boys had hold of the vehicle, the appellant drove off at a speed of no more than 10 to 15 kilometres an hour. He described that speed as “a little bit faster than walking pace”. The respondent was not wearing a protective helmet.

3. As the appellant drove along Hillcrest Avenue his son in the front seat was giving him a commentary as to what was going on behind. The appellant also kept his eye on the rear vision mirror. After the vehicle had travelled “a couple of hundred metres up the road” the respondent was seen to be "wobbling" on his skateboard. He then “let go” of the vehicle and fell backwards striking his head on the bitumen surface of the roadway. He suffered a hairline fracture to the lower posterior part (ie, the occipital region) of his skull and consequential damaging contrecoup contusions to the frontal lobes of his brain.

Australian Road Rules

4. Neither party referred to or relied upon any Australian Road Rule as relevant to the determination of any question of negligence and contributory negligence. That is perhaps explicable on the basis that the determination of what reasonable care requires in any given case is not resolved by asking whether the relevant conduct was or was not prohibited by one of those rules. Nevertheless the fact that particular conduct is prohibited may in some cases be a factor pointing to the conclusion that reasonable care was not taken: per Bell JA (as her Honour then was) with whom Mason P agreed in Kollas v Scurrah [2008] NSWCA 17 at [76]. See also Sharpe v Gordon; QBE Workers Compensation NSW (Ltd) v Gordon [2006] NSWCA 347 at [5] – [6]; and Penrith City Council v East Realisations Pty Limited (in liq) [2013] NSWCA 64 at [53] – [54].

5. It should nevertheless be noted that in January 2007 there was a Rule which expressly applied to the activity that resulted in the respondent’s injuries. The Rules define a “wheeled recreational device” to include “roller blades, roller skates, a skate board, scooter, unicycle or similar wheeled device”. Rule 244 provided:

244   Wheeled recreational devices or wheeled toys being towed etc

(1)   A person must not travel in or on a wheeled recreational device or wheeled toy that is being towed by a vehicle.

(2)   A person travelling in or on a wheeled recreational device or wheeled toy must not hold onto a vehicle while the vehicle is moving.

6. I emphasise that since neither party relied on Rule 244 I have not taken the Rule into account when addressing a question which arises in this appeal concerning the reduction of the respondent’s damages for contributory negligence.

The outcome of the proceedings at trial

7. The respondent brought proceedings in the District Court claiming damages for negligence. One defence was that the respondent’s injuries were contributed to by his own negligence. The particulars of contributory negligence included:

(a)   Riding a skateboard holding onto the defendant’s vehicle while it was moving.

(b)   Voluntarily engaging in an activity that was inherently dangerous.

(c)   Failure to take adequate precautions for his own safety.

(d)   Failure to wear a protective helmet.

8. That claim was heard by the primary judge (Levy DCJ) over a number of days in March 2014. In the course of his cross-examination, in response to questions directed to the possible causes of the accident, the appellant frankly conceded that “the road wasn’t to blame, I was to blame” and that the problem was not the light or road surface but a “lack of brain problem by the driver”.

9. The primary judge delivered his principal judgment on 14 April 2014: Schoupp v Verryt [2014] NSWDC 28. After the parties were given the opportunity to consider aspects of his Honour’s findings relevant to the claim for funds management charges, further reasons were delivered on 15 April 2014: Schoupp v Verryt(No 2) [2014] NSWDC 29. At that time judgment was entered for the respondent in the amount of $2,204,150.47.

10. That amount (ignoring cents) was made up as follows:

Head of Damage	Amount
Non-economic loss	$300,000
Future economic loss	$610,000
Future loss of superannuation	$88,267
Past gratuitous domestic assistance	$45,000
Future external domestic assistance	$712,250
Future gratuitous domestic assistance	$42,331
Case management expenses	$121,722
Future treatment expenses	$15,000
Past out-of-pocket expenses	$19,580
Funds management charges	$250,000
Total	$2,204,150

Findings concerning contributory negligence

11. The primary judge rejected the appellant’s contributory negligence defence. His Honour found the respondent was negligent in the respects alleged in particulars (a) to (d), in the sense that he failed to exercise reasonable care for his own safety: [2014] NSWDC 28 at [115] – [118], [121], [122]. In relation to particular (d) (failure to wear a protective helmet) his Honour held that the appellant had not established ‘legal’ causation within s 5D(1)(b) of the Civil Liability Act 2002 (NSW) (the CL Act): [2014] NSWDC 28 at [143] – [152]. He considered the appellant had not established that, had the respondent been wearing a helmet, his frontal lobe injuries would have been any different. It was not contested that the other respects in which the respondent failed to exercise reasonable care had contributed causally to his accident and injuries.

12. Addressing the question of apportionment, the primary judge found that the respondent’s lack of care “was totally eclipsed and overshadowed by the overwhelming negligence” of the appellant: [2014] NSWDC 28 at [162]. Having made that assessment, he concluded that it was just and equitable that the appellant driver bear 100% of the responsibility for the occurrence of the accident. Accordingly, the primary judge held that there should be no reduction in the damages recoverable by the respondent: [2014] NSWDC 28 at [173].

Damages for future economic loss

13. The primary judge awarded damages for future economic loss of $610,000. That award had two components. The first was an amount of $413,453 which represented the respondent’s loss of earning capacity over his working life as a tradesman, carpenter and joiner based on a projected loss of $550 per week net: at [375]. The second was an amount of $200,000 awarded as a lump sum or “buffer” to compensate for the loss of opportunity to pursue possible future self-employment in a small business in the building trade based on the respondent’s qualifications as a carpenter and joiner: at [386]. The primary judge then rounded the overall award down to $610,000.

The issues in the appeal

14. Although the notice of appeal contains 26 grounds addressing five aspects of the trial judge’s findings and assessments of damage, in the course of the oral argument the matters remaining in dispute were reduced to two. They are:

(1)   Whether the primary judge erred in concluding that there should be no reduction in the respondent’s damages for contributory negligence. Grounds of appeal 1 to 14 are directed to this question.

(2)   Whether the primary judge erred in including the amount of $200,000 in the assessment of damages for future economic loss as a “buffer” for the respondent’s loss of the chance to earn income from self-employment as a qualified carpenter and joiner. The relevant grounds of appeal are grounds 15 and 16.

15. Before addressing these questions I will record how the remaining issues have been resolved.

The remaining issues raised by the notice of appeal

16. The respondent concedes that the primary judge erred in awarding, as part of the future loss of superannuation, an amount calculated as 14.47% of the “buffer” of $200,000 awarded for future economic loss. That issue was raised by grounds 15 and 17. The concession recognises a self-employed person must make provision for his or her own superannuation and that the “buffer” was awarded for the respondent’s lost opportunity to earn a higher income as a self-employed person. Irrespective of whether the appeal in relation to the buffer amount succeeds, the assessment of future loss of superannuation should be reduced from $88,267 to $57,327.

17. Secondly, it is agreed that the amount awarded for future external domestic assistance should be reduced by $96,866 to $615,384 by reason of a mathematical error by the primary judge. That issue was raised by ground 18. In relation to the remaining challenge by ground 19 to the award for future external domestic assistance as “excessive”, the appellant does not contend for any specific error on the part of the primary judge in arriving at that assessment. He also concedes that it is not sufficient to establish error to suggest that the amount assessed is “excessive”. In those circumstances, the appeal on that ground is rejected.

18. Thirdly, grounds 20 to 26 challenge the awards of damages for case management expenses and funds management charges. Those grounds contend that in each case the amount awarded is excessive. In oral argument it was accepted that the only basis on which it was argued that one or other of those awards was excessive was that they overlapped. The respondent was awarded damages for case management services because he required the assistance of an occupational therapist for four hours per calendar month at an average cost of about $138 per hour. Ms Heathcote gave evidence of the respondent’s need for those services. They would be provided by a case manager and included “financial guidance”. In oral argument it was conceded on behalf of the appellant that that guidance did not cover the same subject matter as any of the services to which the separate fund management award was directed. It was not submitted that there were any other respects in which these two heads of damage involved duplication. It follows that the challenge to each of these assessments is rejected.

19. Finally, the respondent accepts that the award of damages for funds management, which is calculated as 13% of the balance of the damages awarded, will have to be recalculated to take account of these and any other reductions in the heads of damage awarded by the primary judge.

Contributory negligence

Relevant statutory provisions

20. The relevant statutory provisions are referred to in my judgment in Davis v Swift [2014] NSWCA 458 at [23] – [26], [28] – [29]:

[23] Section 138(1) of the MAC Act provides that the "common law and enacted law as to contributory negligence" apply to an award of damages in respect of a motor accident, except as provided by that section. The enacted law relevantly is the Law Reform (Miscellaneous Provisions) Act1965 (NSW) (LR Act), s 9 and the Civil Liability Act2002 (NSW) (CL Act), ss 5R and 5S. Sections 138(2) and (3) vary the enacted law; the former by requiring findings of contributory negligence to be made in particular cases; and the latter by describing in more general terms the matters to which regard may be had when apportioning responsibility.

[24] The starting point is s 9(1) which provides that if the claimant "suffers damage as the result partly of the claimant's failure to take reasonable care (contributory negligence) and partly of the wrong of any other person" the damages recoverable in respect of the wrong "are to be reduced to such extent as the court thinks just and equitable having regard to the claimant's share in the responsibility for the damage". That description of contributory negligence reflects the common law position that the claimant's lack of care must contribute to the occurrence of the injury or the nature or extent of it: Nance v British Columbia Electric Railway Co Ltd [1951] AC 601 at 611 in a passage cited with approval by the majority in Astley v Austrust Ltd [1999] HCA 6; 197 CLR 1 at [21].

[25] The approach to the reduction of damages in accordance with the language of s 9(1) was described in Podrebersek v Australian Iron & Steel Pty Ltd [1985] HCA 34; 59 ALJR 492 at 494 as follows:

The making of an apportionment as between a plaintiff and a defendant of their respective shares in the responsibility for the damage involves a comparison both of culpability, i.e. of the degree of departure from the standard of care of the reasonable man ... and of the relative importance of the acts of the parties in causing the damage .... It is the whole conduct of each negligent party in relation to the circumstances of the accident which must be subjected to comparative examination. The significance of the various elements involved in such an examination will vary from case to case; for example, the circumstances of some cases may be such that a comparison of the relative importance of the acts of the parties in causing the damage will be of little, if any, importance.

[26] Section 138(3) is in different terms to s 9(1) and the other State provisions based on s 1(1) of the Law Reform (Contributory Negligence) Act 1945 (UK). Whereas those provisions require the Court when assessing what is "just and equitable" to have regard "to the claimant's share in the responsibility for the damage", s 138(3) provides:

(3)   The damages recoverable in respect of the motor accident are to be reduced by such percentage as the court thinks just and equitable in the circumstances of the case.

…

[28] In a case that does not involve a finding of contributory negligence made under s 138(2) or deemed fault on the part of the owner or driver, an assessment of what is "just and equitable in the circumstances of the case" will involve, as part of that evaluative process, a comparison of the kind described in Podrebersek. See the discussion per Giles JA in Mackenzie v The Nominal Defendant [2005] NSWCA 180; 43 MVR 315 at [54] - [63]. In Joslyn v Berryman [2003] HCA 34; 214 CLR 552 at [157] Hayne J considered s 74(3) [of the Motor Accidents Act 1988 (NSW), which is in the same terms as s 138(3)] to require the undertaking of such a comparison: cf Kirby J at [133].

[29] Section 5R of the CL Act, which by s 3B(2)(a) applies to motor accidents, provides that the principles applicable in determining whether a person has been negligent, which include those in s 5B, also apply in determining whether the person who has suffered harm has been contributorily negligent in failing to take precautions against the risk of harm which materialised and resulted in injury. As Basten JA observed in Gordon v Truong [2014] NSWCA 97; 66 MVR 241 at [15], a case involving a collision between a pedestrian and a motor vehicle, the existence and extent of a claimant's contributory negligence is to be assessed by reference to the risk of harm which is the subject of his or her claim for damages, and the precautions that a reasonable person in the claimant's position would have taken against that risk. Section 5S provides that in apportioning responsibility a court may determine a reduction of 100 per cent in the claimant's damages by reason of contributory negligence.

The primary judge’s reasoning

21. The primary judge found that the respondent was negligent in the four respects referred to above. Those findings are not challenged by way of notice of contention. It is convenient to set the relevant particulars out again:

(a)   Riding a skateboard holding onto the defendant’s vehicle while it was moving.

(b)   Voluntarily engaging in an activity that was inherently dangerous.

(c)   Failure to take adequate precautions for his own safety.

(d)   Failure to wear a protective helmet.

22. His Honour dealt with particulars (a), (b) and (c) together and found that a reasonable 12 year old in the position of the respondent would have appreciated that he was engaging in a dangerous activity in view of the risk of losing balance at speed and falling off the skateboard and onto the bitumen roadway: [2014] NSWDC 28 at [115], [116]. With respect to particular (c) his Honour did not find that there were any specific precautions that the respondent should have taken for his own safety. In relation to the first three particulars the primary judge is to be taken to have held that a reasonable 12 year old in the respondent’s circumstances would have appreciated that risk and not engaged in the activity at all: [2014] NSWDC 28 at [115] – [122]. In relation to particular (d) the primary judge found that a reasonable person of the respondent’s age would have appreciated that he should have been wearing the bicycle helmet: [2014] NSWDC 28 at [90] – [92]. The respondent had a bicycle helmet available to him on the day in question: [2014] NSWDC 28 at [82], [91].

23. As the primary judge made no finding of contributory negligence under s 138(2) of the MAC Act, the determination of what was “just and equitable in the circumstances of the case” in accordance with s 138(3) required, as part of that evaluative process, an assessment of the kind described in Podrebersek v Australian Iron & Steel Pty Ltd [1985] HCA 34; 59 ALJR 492. That assessment involved a comparison of the degree of departure from the standard of care by each of the parties and of the relative importance of their acts or omissions in causing the accident and injuries. Of the findings of negligence made, the failures in (a), (b) and (c) causally contributed to the occurrence of the accident and injuries, whereas the failure in (d) was capable only of causally contributing to the nature and extent of the respondent’s injuries.

The causal significance of the failure to wear a helmet

24. The primary judge considered whether the respondent’s failure to wear a protective helmet (particular (d)) was causally significant. He was right to do so. The condition in s 9(1) of the Law Reform (Miscellaneous Provisions) Act 1965 (NSW) (LR Act) that enlivens the power to apportion responsibility by reducing the damages recoverable (albeit in accordance with the terms of s 138(3) of the MAC Act) is “if a person (the claimant) suffers damage as the result partly of the claimant’s failure to take reasonable care (contributory negligence) and partly of the wrong of any other person”.

25. However his Honour did not then proceed to address the factual question whether the respondent’s injuries were caused or materially contributed to by his failure to wear a helmet in accordance with the principles in March v E & M H Stramare Pty Ltd [1991] HCA 12; 171 CLR 506. Instead the primary judge proceeded upon the basis that for the appellant to prove causation for the purpose of its contributory negligence defence it had to satisfy each of the elements in s 5D(1) of the CL Act: [2014] NSWDC 28 at [133]. He appears to have regarded that as necessary in order to comply with the direction in s 5R(1) of the CL Act that the “principles that are applicable in determining whether a person has been negligent also apply in determining whether the person who suffered harm has been contributorily negligent”. It would seem that his Honour considered those “principles” to refer not only to the principles in s 5B but also to those in s 5D(1) which are expressed to apply to a “determination that negligence has caused particular harm”.

26. The onus of establishing the elements of contributory negligence, including causation, was on the appellant. Section 138 of the MAC Act, as with s 74 of the Motor Accidents Act 1988 (NSW), is silent as to who bears that onus. However, in Nicholson v Nicholson (1994) 35 NSWLR 308 at 315, 332, 334 the Court held that the common law rule that the defendant bears the onus of proving contributory negligence was not altered by s 74.

27. The appellant (by grounds of appeal 2 and 3) contends that the primary judge erred in proceeding on the basis that s 5D applied. In particular he submits that his Honour erred in addressing the “scope of liability” question arising under s 5D(1)(b). The respondent, correctly in my view, concedes this error. The “principles” referred to in s 5R(1) as applicable in determining whether a person has been negligent are those in s 5B: see Gordon v Truong; Truong v Gordon [2014] NSWCA 97 at [14] – [16]; Boral Bricks Pty Ltd v Cosmidis(No 2) [2014] NSWCA 139 at [59], [94]; T and X Company Pty Ltd v Chivas [2014] NSWCA 235 at [12], [51]; Grills v Leighton Contractors Pty Limited [2015] NSWCA 72 at [173]. They do not include those in s 5D(1) which are directed to a different question, namely, whether for the purpose of attributing liability, negligence caused particular harm. In light of the respondent’s concession, it is not necessary to consider the correctness of what is said in Nominal Defendant v Rooskov [2012] NSWCA 43 at [142] – [144] and in Mikaera v Newman Transport PtyLtd [2013] NSWCA 464 at [44].

28. The parties accept that it remained necessary for the primary judge to address, in accordance with the principles in March v Stramare, whether the fact that the respondent was not wearing a helmet causally contributed to the nature and extent of his injuries, and that the appellant bore the onus on that issue. His Honour did not address that question when considering the element of “factual causation” in s 5D(1)(a). Instead, although purporting to address that question in relation to the wearing of a helmet, the primary judge concluded at [134]:

It is clear that but for the negligence of the plaintiff in maintaining his handhold on the defendant's vehicle when it moved off, and the plaintiff continuing to maintain that handhold until just before he fell, the plaintiff's head would not have been injured when it struck the roadway: s 5D(1)(a) of the CL Act.

29. The primary judge did however address the causation question concerning the wearing of a helmet in his consideration of the element of “scope of liability” under s 5D(1)(b). Although this was an unnecessary inquiry, in undertaking the inquiry his Honour made findings that are important on the question of causation.

30. He made the following findings: [2014] NSWDC 28 at [142], [146] - [152].

31. First, the cut to the back of the respondent’s head and the undisplaced fracture to the occipital region of his skull did not cause him any significant or lasting problems. Secondly, the injuries to his frontal lobes that have given rise to the claims for extensive damages founded upon his cognitive and behavioural problems were the contrecoup injuries. The mechanism of those injuries was as follows:

… the contrecoup injury is commonly understood to be due to the operation of transmitted forces within the skull, where the inertia of the brain located in a balanced position in cerebrospinal fluid, is disrupted and pushed away from the area [where] the striking force was applied to the head, in this case, to the occipital region, and towards the opposite side of the cranial cavity, in this case the frontal region, hence the occurrence of contusions to the frontal lobes in the positions described in the medical evidence …

32. Finally, there was no evidence directed to whether the damage to the frontal lobes due to those contrecoup forces would not have occurred, or would not have been so serious, if the respondent had been wearing a protective helmet. That being the position, the primary judge concluded at [151]:

The defendant cannot point to any matters from within the evidence other than matters of impermissible conjecture and surmise, to warrant a conclusion, on the balance of probabilities, that the plaintiff's brain damage from the contrecoup mechanism was relevantly caused by his failure to wear a protective helmet: s 5D(1)(b) of the CL Act.

33. The appellant submitted that the primary judge’s finding at [134] (see [28] above) included that each of the proved particulars of negligence was causally significant. However, that finding does not address causation in relation to particular (d). As the respondent submits, that question, albeit in the context of an unnecessary consideration of the “scope of liability” under s 5D, was answered unfavourably to the appellant. The appellant is thus forced to submit that the finding set out above involved error. That submission should be rejected.

34. The primary judge correctly observed that there was no medical or other evidence considering what the nature and extent of the respondent’s frontal lobe injuries was likely to have been had he been wearing his helmet. That inquiry could not have been undertaken without first making assumptions as to the “safety” specifications of the relevant helmet. Those assumptions would then have had to be proved. In the absence of any evidence addressing these matters the primary judge is not shown to have erred in concluding that it was a matter of speculation whether the respondent’s frontal lobe injuries would have been different and less serious if he had been wearing his helmet.

The primary judge’s apportionment of responsibility

35. The primary judge embarked on the exercise of apportioning responsibility between the parties on the basis that the negligence or failure to take care of each was a necessary condition of the accident and of the injuries sustained by the respondent. That involved no error because if either had decided not to participate the accident would not have occurred. In weighing the degree of departure of each from the relevant standard of care – in the case of the appellant that of an adult and the driver of the vehicle and in the case of the respondent that of a 12 year old boy - the primary judge concluded that the appellant “must overwhelmingly bear responsibility” and that it was just and equitable that there be no reduction of the damages recoverable notwithstanding the findings as to the respondent’s contributory negligence: [2014] NSWDC 28 at [154], [170], [173].

36. The principal matters that the primary judge took into account in making that assessment were: that the appellant was a mature adult who should have appreciated the dangerous nature of the activity and could have prevented it by refusing to drive: [155]; that the appellant should have appreciated that the boys were likely to look to him as the adult driver to decide whether the “skitching” should be permitted to proceed: [156]; that the respondent was the youngest of the three boys and a “follower” who the appellant should have appreciated would have been easily influenced to join in the activity at the instigation of the others: [157]; that the appellant did not insist that the boys wear protective helmets although it was obvious that they were not doing so: [158]; that the boys, including the respondent, were likely to assume that as the appellant had previously and uneventfully allowed his vehicle to be used for “skitching”, that would also be the outcome on this occasion: [160]; and that the explanation for the respondent’s conduct was “likely to have been in accordance with the characterisation described in the guiding opinions of Associate Professor Quadrio”, a consultant child and adolescent psychiatrist whose report was tendered in evidence without objection and without any requirement that she attend for cross-examination: [161].

37. The primary judge treated that evidence as expert opinion evidence “of the objective standard of the likely behaviour of someone in the position of the plaintiff” and of “the likely behaviour of a normal reasonable child in the given circumstances”: [102], [106], [114]. His Honour noted at [102] that it was not inadmissible only because it was directed to a fact in issue: Evidence Act 1995 (NSW), s 80(a). The primary judge did not address whether the evidence also was not inadmissible because it was about a matter of common knowledge, namely, how an ordinary 12 year old boy might behave: Evidence Act, s 80(b).

38. Dr Quadrio expressed the view that such a boy was likely to be trusting of the judgment of the adult present and to go along with what the other boys were doing: [99], [107], [108]. More significantly, she considered that a child in the respondent’s position was likely to have lacked any real understanding of the danger of the activity in which he was engaging: [111].

39. Her reasons for that conclusion were expressed as follows:

… From the background history it appears that [the respondent] was a well behaved lad and there is no history of disruptive or reckless behaviour either at school or at home. In that case it may be assumed that he was not a particularly reckless child so that at the material time it seems likely that he did not understand that he was undertaking something highly dangerous or reckless; it is likely that he felt some confidence in [what] he was doing since apparently the driver of the vehicle was agreeable to it and the older boys were prepared to do it.

40. Earlier in his reasons the primary judge had described admissions made by the respondent to the effect that he knew “skitching” was a dangerous thing to do as “hindsight concessions, in view of the medical evidence of the plaintiff’s amnesia for the events surrounding the accident”: [2014] NSWDC 28 at [79]. Relying on Dr Quadrio’s evidence that it was likely the respondent lacked any real understanding of the danger of that activity, the primary judge inferred, because there had been no cross-examination of the respondent directed to his understanding, that the respondent was “obviously comfortable” with what the appellant had agreed to in allowing the boys to “skitch” up the hill: [2014] NSWDC 28 at [112], [113].

41. The primary judge considered the following matters to be particularly significant and to support his conclusion that the respondent’s lack of care was completely overwhelmed by the negligence of the defendant:

[167]   … I consider that the activity in which the plaintiff chose to join was an act of youth and immaturity, as explained by the evidence of Associate Professor Quadrio, and where the activity in question was under the control of a seemingly and ostensibly responsible adult who was known to the plaintiff, but was also known to be a parent of a teenage boy.

[168]   Also relevant to the conclusion that the defendant's negligence was overwhelming in the circumstances was the fact that he had been the driver for the "skitching" activity on a previous occasion, and he had not seen fit to desist on this subsequent occasion, but instead agreed to participate on this occasion, under pressure that reasonable care should have required him to resist. That of itself was an overwhelming and negligent misjudgement, where he abandoned his own judgment in favour of meeting a requirement based on the immature urgings of teenage boys.

[169]   In those circumstances, the failure of the responsible adult to observe the requirements of reasonable care in that way, should be seen to be completely overwhelming of a fleeting lapse of concentration and focus by a boy of 12 years and 10 months, acting in the enthusiasm of the moment contrary to the best interests of his personal safety, and where the events in question were under the control and supervision of the familiar adult in charge of the enterprise.

The challenges to the primary judge’s apportionment

42. The appellant makes three challenges to the determination that there should be no reduction for contributory negligence. First, it is said that the conclusion that the appellant was “overwhelmingly culpable” was not justified by the evidence and involved a manifestly wrong evaluation of the comparative blameworthiness of the parties. That argument is raised by grounds of appeal 1, 5, 6, 11 and 13.

43. Secondly, it is said that the primary judge erred in not finding, in accordance with the respondent’s evidence, that at the time of the accident he appreciated that “skitching” was dangerous. It is also submitted that his Honour erred in proceeding on the basis that the respondent had not been cross-examined as to that understanding and in drawing the inference, in the absence of such cross-examination, that the respondent was “obviously comfortable” with any risk involved in the activity. These arguments are made by grounds of appeal 7, 9 and 10. Ground of appeal 8 may be put aside because it is concerned with the risks associated with not wearing a helmet. The question of the respondent’s culpability with respect to that particular of contributory negligence need not be considered because it was not established to be causally significant.

44. Thirdly, the appellant says that the primary judge erred in relying on the “speculative and arguably inadmissible and irrelevant opinions” of Associate Professor Quadrio. This argument is raised by ground of appeal 14.

45. It is convenient to deal first with the second of these arguments. If the primary judge is found to have mistaken the facts in a material respect that is sufficient to establish error requiring this Court to address afresh the question of apportionment: British Fame (Owners) v Macgregor (Owners) [1943] AC 197 at 201 (“unless there is some error in law or in fact [the judge’s apportionment] ought not be disturbed”); Pennington v Norris [1956] HCA 26; 96 CLR 10 at 16.

Whether the respondent knew there was a danger involved in “skitching”

46. The primary judge’s finding at [79] that the respondent’s answers involved “hindsight concessions” is made in relation to the respondent’s evidence that letting go of the car was a “fairly dangerous thing to do” (tcpt 12/03/14, p 81). It is not clear from the exchange leading to this answer whether it was directed to his assessment of the position as he sat in the witness box or to his recalled understanding as a 12 year old. His Honour is not shown to have erred in describing that answer as being a “hindsight” concession.

47. But that is not the end of the matter. The respondent also gave evidence about the earlier occasion on which he had been towed on his skateboard by the appellant (tcpt 12/03/14, pp 82 – 83):

Q.   How old were you then?

A.   12.

Q.   On the prior occasion, is this right, you did it because there were other

boys doing it?

A.   Yep.

Q   But you knew there was a danger involved in that because you were holding onto the rear of a car driving up a street?

A.   Yep.

Q.   What you knew on the prior occasion, about the danger of holding onto a car in that way, when you're on a skateboard, is what you knew on the day of this accident, isn't that right?

A.   Yep.

48. This evidence is of an understanding, gained or held before the incident in question, that the activity involved danger. However, the cross-examination did not go on to explore the respondent’s perception of the extent or seriousness of that danger at that earlier time. It might reasonably be inferred that his perception at least included that there was a risk of falling off the skateboard with consequential grazes and bruises. It does not follow that when he was 12 years old the respondent had the degree of foresight to appreciate that he might suffer much more serious and permanent injuries.

49. Nevertheless, this passage of evidence shows that the respondent actually appreciated that there was some danger. It also shows that the primary judge’s observation that there had been no cross-examination directed to the respondent’s understanding of the danger was wrong. In the face of this error and the respondent’s evidence that he appreciated that “skitching” involved some danger, the inference drawn by the primary judge at [113] that the respondent was “obviously comfortable” with any risks associated with what he was doing cannot be sustained. The existence of this error in relation to the respondent’s understanding and that it informed the primary judge’s assessment of the respondent’s culpability, are sufficient to require that this Court re-assess the question of apportionment.

The admissibility of Dr Quadrio’s evidence

50. Before considering apportionment, something must be said about the admissibility of the evidence of Dr Quadrio. Her “psychiatric report” was given in December 2012. She did not interview or clinically assess the respondent. The information on which her report was based included his school reports and statements from his parents as to his behaviour before and after the accident. She is a qualified psychiatrist in practice as a “consultant child and family and forensic psychiatrist”. Her opinions are described as informed “by considerable experience in the clinical assessment of children and adolescents and in assessing the psychiatric sequelae of trauma and a familiarity with a relevant body of knowledge and research”.

51. The questions which Dr Quadrio was asked to consider did not require or involve any psychiatric assessment of the respondent, either current or at any earlier point in time. Those questions did no more than invite her to express views as to how she thought an ordinary boy of 12 was likely to have acted and thought in the circumstances in which the respondent found himself in January 2007. That subject was not one that her evidence showed to be a field of “specialised knowledge” in which she was expert by reason of her training, study or experience: cf Evidence Act, s 79(1); Dasreef Pty Ltd v Hawchar [2011] HCA 21; 243 CLR 588 at [37].

52. It is necessary also to consider s 79(2)(a) and s 80(b) of the Evidence Act. The former provides that a reference in s 79(1) “to specialised knowledge includes a reference to specialised knowledge of child development and child behaviour (including specialised knowledge of the impact of sexual abuse on children and their development during and following the abuse)”. That provision was introduced by amendments which followed ALRC Report 102, The Opinion Rule and its Exceptions. In the Explanatory note to the Evidence Amendment Bill 2007, p 10 it is said that section 79(2):

… makes it clear that the exception covers expert opinion evidence of persons with specialised knowledge of child development and behaviour … It includes evidence in relation to the development and behaviour of children generally and the development and behaviour of children who have been the victims of sexual offences, or offences similar to sexual offences.

53. Section 80(b) provides that evidence of an opinion “is not inadmissible only because it is about … a matter of common knowledge”. This provision permits someone to express an opinion which is wholly or substantially based on specialised knowledge notwithstanding that the opinion may be “about” a matter of common knowledge. Such an opinion is not “inadmissible” merely because it addresses a subject which also is within the experience of ordinary people: see Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd [2007] FCAFC 70 at [55] – [57].

54. Nevertheless, the position remains that to be admissible the opinion must either be a lay opinion within s 78 or an expert opinion that satisfies s 79. As to the latter, in Velevski v The Queen [2002] HCA 4; 76 ALJR 402, where an issue was whether there was a field of expertise that would enable a person to express an opinion that particular wounds were self-inflicted, Gummow and Callinan JJ observed at [158]:

Nothing in s 79 of the Evidence Act 1995 (NSW) ("the Act"), stands in the way of the reception of expert evidence of this kind. "Training, study or experience", the words used in the section, necessarily include, as they must in all areas of expertise, observations and knowledge of everyday affairs and events, and departures from them. It will frequently be impossible to divorce entirely these observations and that knowledge from the body of purely specialised knowledge upon which an expert's opinion depends. It is the added ingredient of specialised knowledge to the expert's body of general knowledge that equips the expert to give his or her opinion. Section 80(b) of the Act is to no different an effect.

55. In Campbell v R [2014] NSWCCA 175 at [225], Bathurst CJ doubted whether evidence that in truth is evidence which, to adopt the expression used in Cadbury Schweppes v Darrell Lea at [55], “is patent and known to all", is made admissible by s 80(b) because such evidence “as a matter of logic would not be based on specialised skill and knowledge”. Whether that is so, s 80(b) does not make admissible, as opinion evidence, evidence which does not satisfy s 78 or s 79. It provides that such opinion evidence is not inadmissible only because it is about a matter within ordinary experience and knowledge. The decisions referred to below recognise that in the common law there is a rule that would prevent proof of such matters, by expert opinion or otherwise. The operation of that rule is countermanded by s 80(b).

56. In McHale v Watson [1966] HCA 13; 115 CLR 199 the issue was whether a boy aged 12, in throwing a sharpened piece of metal at a wooden post, was liable for failing to exercise reasonable care in relation to a younger girl who was standing near the post and hit in the eye by the metal object after it had glanced off the post. An issue on the appeal from the decision of the trial judge, Windeyer J (McHale v Watson [1964] HCA 64; 111 CLR 384) was whether the boy did anything that a reasonable boy of his age would not have done in the circumstances. Kitto J described (at 215) such a boy as one “who possessed and exercised such degree of foresight and prudence as is ordinarily to be expected of a boy of twelve, holding in his hand a sharpened spike and seeing the post of a tree-guard before him”. He continued (at 215 – 216):

… It is, I think, a matter for judicial notice that the ordinary boy of twelve suffers from a feeling that a piece of wood and a sharp instrument have a special affinity. To expect a boy of that age to consider before throwing the spike whether the timber was hard or soft, to weight the chances of being able to make the spike stick in the post, and to foresee that it might glance off and hit the girl, would be, I think, to expect a degree of sense and circumspection which nature ordinarily withholds till life has become less rosy.

57. The view as to such matters not being the subject of proof was expressed earlier by Dixon CJ, Kitto and Taylor JJ in Transport Publishing Co Pty Ltd v Literature Board of Review [1956] HCA 73; 99 CLR 111. In that case it was contended that a publication had the tendency to deprave or corrupt. That issue turned in part on the characteristics of the persons to whom the publication was likely to be distributed. Their Honours observed (at 119) with respect to the characteristics of those persons, that “ordinary human nature, that of people at large, is not a subject of proof by evidence, whether supposedly expert or not”. A distinction was drawn between such ordinary characteristics and those that might be attributed to a special category of persons. It was accepted that opinion evidence might be given as to the characteristics or behaviour of that category of persons. See also Director of Public Prosecutions v United Telecasters Sydney Ltd [1990] HCA 5; 168 CLR 594 at 598.

58. In a case such as the present, but for the operation of s 80(b), the position would be as described by Lawton LJ in R v Turner [1975] 1 QB 834 at 841:

An expert’s opinion is admissible to furnish the court with scientific information which is likely to be outside the experience and knowledge of a judge or jury. If on the proven facts a judge or jury can form their own conclusions without help, then the opinion of an expert is unnecessary. In such a case if it is given dressed up in scientific jargon it may make judgment more difficult. The fact that an expert witness has impressive scientific qualifications does not by that fact alone make his opinion on matters of human nature and behaviour within the limits of normality any more helpful than that of the jurors themselves;

…

… Jurors did not need psychiatrists to tell them how ordinary folk who are not suffering from any mental illness are likely to react to the stresses and strains of life.

59. Dr Quadrio’s views were with respect to matters of ordinary human experience. Unlike the position under the common law, and because of s 80(b), they were not inadmissible for that reason alone. However, they were not shown to be based on any specialised knowledge of a 12 year old child’s ordinary behaviour in circumstances such as those confronting the respondent. For that reason the evidence was not admissible under s 79 and, if objected to, should have been rejected.

60. The fact that it was admitted and given some weight did not, however, result in any material error. To the extent that Dr Quadrio’s views were relevant they were as to what a 12 year old boy was likely to think or do and reflected what experience and recollection confirm on the basis of ordinary experience.

Apportionment of responsibility for respondent’s contributory negligence

61. When apportioning responsibility some account must be taken of the respondent having engaged in an activity that he understood carried some risk of injury and which, in accordance with the primary judge’s findings as to contributory negligence, a reasonable 12 year old in his position would have appreciated was dangerous; in each case because of the risk of losing balance at speed and landing awkwardly on the roadway.

62. At the same time it may readily be accepted, as was emphasised in McHale v Watson, that a 12 year old boy is unlikely to perceive as a realistic prospect the risk of a serious injury such as was sustained by the respondent. A 12 year old is optimistic and likely to be oblivious to the real and ever-present prospect of such an injury. In the somewhat wistful language of Kitto J, that degree of sense and circumspection is one “which nature ordinarily withholds till life has become less rosy”. It is also the case, as the primary judge rightfully emphasised, that a 12 year old boy would likely gain comfort from the fact that the activity was one that the adult father of his neighbourhood friend had agreed to participate in. That participation would have confirmed in the boy’s mind that the activity did not involve unacceptable risks of injury.

63. Most importantly, the appellant was responsible for the safe operation of the vehicle. He must be taken to have appreciated that “skitching” involved significant risks of injury, including of the kind that occurred. As the driver of the vehicle, the appellant was in the position to prevent the activity and should not have allowed it to occur. Not only did he fail in that respect; he also allowed it to proceed aware that none of the boys was wearing a helmet.

64. For these reasons, the appellant must bear by far the greater responsibility for the injuries sustained by the respondent. His acceptance that he “was to blame” and description of his actions as involving a “lack of brain problem” acknowledge the correctness of this assessment. Nonetheless, it is just and equitable that the respondent bear a small proportion of the responsibility for the damage resulting from the accident. A sufficient allowance for the respondent’s lack of care for his own safety is reflected in a reduction of his damages by 10%.

Damages for future economic loss

The primary judge’s reasoning

65. The respondent claimed damages for the loss of capacity to earn income as an employed carpenter or in self-employment using his trade qualifications as a carpenter and joiner. He sought damages in an amount of about $765,000. Whilst accepting that there might be a single amount awarded as compensation for all aspects of the respondent’s loss of earning capacity, the appellant contended for a much lower amount. In doing so the appellant argued that such an amount ought not include any significant component for loss of the capacity to earn income from self-employment: [2014] NSWDC 28 at [330] – [334].

66. In addressing that claim the primary judge made several findings that are not challenged by any of the grounds of appeal. Those findings include that it was very likely that the respondent would have become a well-qualified tradesman carpenter and joiner; that it was very likely that he would have achieved a significant position of responsibility in his future employment in that trade: [344(7), (8), (9)]; that it was possible that when he became suitably qualified and experienced the respondent would at some stage have been motivated to pursue a similar endeavour in his own small business venture within the skill set of his trade: [344(10)]; and that his potential capacity to pursue such self-employment opportunities effectively was closed to him by the injuries he had sustained: [384].

67. It is convenient at this point to address the suggestion in the appellant’s written argument that the primary judge should have preferred the evidence of Dr Spira that the respondent’s cognitive changes due to the accident would not have any impact on his capacity to run a business in the future. The primary judge’s finding that such opportunities were effectively closed to the respondent was based on the evidence of Dr Jungfer and the respondent’s employer, Mr Pugh. The latter’s evidence, based on his assessment of the respondent’s work capacity over a period of two and a half years, was that he was not “capable of running a business”. It was not in issue that the matters to which he referred as adversely affecting the respondent’s work capacity (see [2014] NSWDC 28 at [352]) were consequences of his injury. And it was not suggested to Mr Pugh that his assessment that the respondent could not “go out and form” his own business was not justified. Nor was Dr Jungfer cross-examined on her statement that she did not consider the respondent “able to take on a supervisory or leadership role”. That being the position the primary judge is not shown to have erred in his conclusion that the respondent’s loss of earning capacity included loss of a capacity to earn income in his own business.

68. Having assessed the respondent’s loss of earning capacity as an employee at $550 per week net, the primary judge turned to consider the value of the other element of the respondent’s claim. He noted that the potential profitable earnings of self-employed persons in the carpentry, joinery and building industry were necessarily imprecise. The evidence of Mr Pugh was that the starting level for people working for themselves could be between $80,000 and $100,000 per annum before tax and that a self-employed builder “in the high end” might generate a net profit before tax of “a couple of hundred thousand a year” (tcpt 19/03/14, p 355).

69. His Honour considered that a “significant additional component … representing a loss of earning capacity from potential self-employment should be added … [in an amount] that reflects the imponderables inherent in those potential circumstances”: at [379]. Those imponderables were said to include “the size of the undertaking, the size of the market, the number of employees generating profitable income, the business acumen of the principal, the timing of commencement of the business and the duration of the trading period”: [2014] NSWDC 28 at [382].

70. His Honour concluded at [385]:

In doing the best I can to achieve a fair balance between the competing interests of the respective parties, and allowing an adjustment to avoid overlap or over-compensation with the first limb of the exercise, I consider that the proper amount for a buffer to compensate for this head of loss is the sum of $200,000.

71. An amount of $200,000, assuming the immediate commencement of the business, its continuation for a working life of 46 years and allowing a 15% discount for vicissitudes, is equivalent to additional earnings of approximately $200 net per week. As the respondent’s potential earning capacity as an employee was assessed at $1100 per week net, earnings of $200 net per week represent approximately 50% of the difference between that earning capacity and $80,000 per annum after tax (ie about $1600 per week). The primary judge calculated the latter to be the after tax equivalent of the “average of the range between $80,000 per annum [gross] and $200,000 per annum [gross]” suggested by Mr Pugh. At [381] and [382] he referred to these calculations as illustrating, because of the imponderables involved, the inherent uncertainty of the assessment exercise he had undertaken. The existence of those imponderables was said at [383] to be the reason “a global discretionary buffer is required”.

The challenges to the assessment of the loss of capacity to earn income in self-employment

72. The appellant challenges this aspect of the award for loss of earning capacity as being manifestly excessive and not supported by the evidence. He says that although the primary judge was satisfied as to the possibility of self-employment but for the injury, he did not explain how on the evidence he arrived at his global assessment of the value of that lost opportunity at $200,000. The appellant also contends that the primary judge did not correctly apply s 126 of the MAC Act. These arguments are raised by grounds of appeal 15 and 16.

73. The argument concerning the application of s 126 of the MAC Act may be disposed of shortly. Section 126(1) provides:

A court cannot make an award of damages for future economic loss unless the claimant first satisfies the court that the assumptions about future earning capacity or other events on which the award is to be based accord with the claimant’s most likely future circumstances but for the injury.

74. The primary judge complied with this requirement. At [344] he set out his assessment of the respondent’s likely circumstances but for his injury. They included that it was very likely that the respondent would have been successfully employed as a carpenter and joiner for the whole of his working life: [344(3), (8), (9)]. In contrast to the terms of those findings, the primary judge also found that there was more than a real possibility that at some stage the respondent would have pursued the opportunity to earn income as a self-employed tradesman: [344(10)], [388]. Notwithstanding the terms of these findings, the appellant did not submit that the quantum of the amount allowed as damages for the loss of this opportunity meant that it became the most likely scenario on which the overall award was “based” and, for that reason, that s 126 had not been complied with. Rather, the appellant relied on the findings to which I have referred, taken with the absence of other evidence, as not justifying that award. That argument is addressed below.

75. Section 126(1) did not require, on the basis of the findings in [344], that his Honour go further and be satisfied as to the “most likely future circumstances” concerning that possibility. Nor did it prevent an award of damages for future economic loss which took account of that possibility although it did not represent the respondent’s most likely future income earning scenario. The sub-section requires that the Court be satisfied that the assumptions on which the award is “based” accord with an assessment of the most likely future circumstances. An award which is assessed by reference to those circumstances and involves adjustments to them so as to accommodate other possible outcomes, favourable or unfavourable to the claimant, does not for that reason cease to be one that is “based” on them.

76. The task which faced the primary judge was not an easy one. He was required to assess the value of the chance that the respondent might have gone on to establish his own business as a tradesman. His unchallenged finding was that there was “more than a real possibility” that “when the plaintiff became suitably qualified and experienced in his trade” he would have pursued a similar endeavour in his own small business: at [344(10)], [388]. The unpredictables and uncertainties to be taken into account in making that assessment included whether the respondent would have done so and, if so, when, in what way, on what scale and with what success. One possibility was that the venture would fail with the consequence that he would earn no income at all for some period.

74. His Honour’s task was not made any easier by the absence of evidentiary material which might have permitted a very rough assessment of the prospects of such a venture succeeding and of the earnings that might have been generated in that event. The only evidence directed to those matters was that of Mr Pugh which referred to a range of possible earnings. That evidence did not relate those earnings to a particular type or scale of business or indicate what the average earnings of such businesses might be. Nor did it explore the incidence of business failures.

75. Notwithstanding these difficulties the primary judge was required to make an assessment that identified and took account of these different possible outcomes for the respondent in pursuing the opportunity to operate his own business, and to adjust the award of damages to reflect that assessment: Malec v JC Hutton Pty Ltd [1990] HCA 20; 169 CLR 638 at 640, 643. As the analysis undertaken by Heydon JA in State of NSW v Moss [2000] NSWCA 133; 54 NSWLR 536 at [66] - [87] shows, where earning capacity has unquestionably been reduced but its extent is difficult to assess, although no precise evidence of likely income is tendered, it is not open to the court to abandon the task and the want of evidence does not necessarily result in non-recovery of damages. Of course that is not this case. Here the question is whether an adjustment should be made to take account of a particular possibility.

76. However the position remains, as Heydon JA noted at [87]:

The task of the trier of fact is to form a discretionary judgment by reference to not wholly determinate criteria within fairly wide parameters. Though the trier of fact in arriving at the discretionary judgment must achieve satisfaction that a fair award is being made, since what is involved is not the finding of historical facts on a balance of probabilities, but the assessment of the value of a chance, it is appropriate to take into account a range of possible outcomes even though the likelihood of any particular outcome being achieved may be no more than a real possibility. [italics added]

80. There are several aspects of the primary judge’s assessment which lead me to conclude that it is manifestly excessive when regard is had to his Honour’s findings and to the evidence. An assessment of the value of the lost opportunity at approximately $200,000 is roughly equivalent to the value of a 50% chance that the respondent would succeed in his endeavour as a self-employed carpenter and that he would work as such from the time of the trial for the remaining 46 years of his working life, earning about $80,000 per annum after tax.

81. The primary judge’s finding at [344(10)] was that it was possible that the opportunity might be pursued when the respondent “became suitably qualified and experienced in his trade”. That was not the position at the time of the trial and could not have been the position at any time before October 2015 when the respondent’s apprenticeship was expected to be completed. When regard is had to these matters the assessment of $200,000 is equal to the value of a greater than 50% chance of earning that amount from sometime after 2015 and for the balance of the respondent’s working life. That outcome is inconsistent with the primary judge’s earlier findings as to the respondent’s most likely circumstances being that he would have worked towards a significant position as an employed tradesman. It results in the respondent being compensated on the basis that his lost earning capacity included a greater than 50% chance of generating a net return after tax that was approximately 35% higher than his earnings in a senior position as an employed carpenter and joiner.

82. That assessment also did not take account of the possibility that any business venture might have been unsuccessful or identify by reference to the average earnings of similarly sized businesses the range of earnings that might realistically have been achieved in such a venture. The evidence did not permit an assessment of the first possibility and such an assessment may have required an adjustment downwards of the amount awarded for the loss of capacity to earn income as an employed carpenter because, if the respondent pursued self-employment, there may have been periods where he earned no income, or less than he might otherwise have earned as an employee.

83. Nor did the evidence permit any realistic assessment of the amounts which the respondent might have earned in his own business, assuming it was successful. Mr Pugh’s evidence was not of the average earnings of such businesses, as is explained at [76] above. The primary judge’s calculation undertaken by way of “illustration” took the median figure in that range.

84. In the face of the findings as to the most likely scenario, and in the absence of these assessments and of evidence which might have enabled them to be undertaken, the assessment at $200,000 of the value of the opportunity of earning more, or perhaps less, than it was conceded the respondent would earn as a senior employed carpenter was plainly excessive.

85. That makes it necessary for this Court to re-assess this aspect of the respondent’s claim. On the basis of the evidence and his Honour’s unchallenged findings the respondent lost a more than real possibility of earning more than he would have earned as an employed carpenter for some part of his working life. It is likely that the opportunity had some value but the evidence does not permit an assessment which would attribute any significant value to it. For that reason only a small and fairly nominal amount can be awarded to compensate the respondent for the loss of that chance. I consider a sufficient allowance to be $25,000.

86. Noting that his Honour’s assessment of the other aspect of the respondent’s claim was rounded down to $410,000, the overall award for future economic loss should be $435,000.

Adjusted amount of the respondent’s damages

87. The amount of the respondent’s damages, adjusted to take account of the reductions which must be made is:

Head of Damage	Amount
Non-economic loss	$300,000
Future economic loss	$435,000
Future loss of superannuation	$57,327
Past gratuitous domestic assistance	$45,000
Future external domestic assistance	$615,384
Future gratuitous domestic assistance	$42,331
Case management expenses	$121,722
Future treatment expenses	$15,000
Past out-of-pocket expenses	$19,580
Funds management charges	$214,675
Total	$1,866,019

88. The award for funds management charges has been recalculated to take into account the reductions made to the other heads of damage. The overall award of $1,866,019 must then be reduced by 10% for the respondent’s contributory negligence. In the result, the amount for which judgment should be entered in favour of the respondent is $1,679,417. That judgment should take effect on 15 April 2014, the date judgment was entered by the District Court.

Costs

89. The appellant has been successful in relation to the two significant issues remaining in dispute. With the exception of the challenge to the award of damages for case management expenses and funds management charges, the appellant has also succeeded on the remaining issues raised by the notice of appeal. Some allowance should be made for the respondent’s success on the issue in respect of those expenses and charges which was addressed in the written submissions and, very shortly, in oral argument. I consider that a sufficient allowance is made if the respondent is ordered to pay 90% of the appellant’s costs of the appeal.

Proposed orders

90. The orders that I propose are:

1.   Appeal allowed in part.

2.   Set aside the verdict and judgment of the District Court ordered on 15 April 2014.

3.   Verdict and judgment for the respondent (plaintiff) against the appellant (defendant) in the sum of $1,679,417.

4.   Order that the judgment in order 3 takes effect on 15 April 2014.

5.   Order the respondent pay 90% of the appellant’s costs of the appeal.

91. Finally, I note that order 5 made by the District Court on 15 April 2014 provided for money to be paid into Court as a condition of the grant of a stay of execution of the judgment below. No order has been sought from this Court as to the payment out of that sum.

92. GLEESON JA: I agree with Meagher JA.

93. SACKVILLE AJA: I agree with the orders proposed by Meagher JA and with his Honour’s reasons.

94. I particularly wish to associate myself with Meagher JA’s analysis of the admissibility of Dr Quadrio’s evidence. One reason that litigation sometimes involves excessive delays and disproportionate expense is the preparation of unnecessary or inappropriate “expert” reports. I appreciate that legal representatives may feel pressure to err on the side of caution when preparing for trial or for the negotiations that may precede the trial. No practitioner wishes to risk failing to fill evidentiary gaps.

95. But there is a very good reason why s 79(1) of the Evidence Act 1995 (NSW) allows opinion evidence from a person who is said to be an expert only if the person has specialised knowledge based on his or her training, study or experience and the opinion is wholly or substantially based on that knowledge. Unless the opinion expressed in an “expert” report satisfies the requirements stated in s 79(1), the opinion is unlikely materially to assist the trier of fact in determining the factual issues arising in the litigation. On the contrary, reliance on a report that does not satisfy the statutory criteria is likely to incur unnecessary costs and can lead to delays in bringing a case to trial. These problems may be compounded if the inadmissible report nonetheless finds its way into evidence and generates equally inadmissible reports in reply or extensive cross-examination of the witness expressing the opinion.

96. It is for these reasons that legal representatives need to consider carefully whether an opinion elicited from an expert can be presented in a form that satisfies s 79(1) of the Evidence Act and, in any event, whether the opinion advances the client’s case. Equally, the representatives of a party served with an inadmissible or irrelevant expert report should be astute to object in a timely fashion to the report being admitted into evidence. Cases can and should be resolved justly and speedily without reliance on expert evidence of dubious utility.

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Decision last updated: 15 May 2015