WARRICK v Bryan

[2005] WASCA 70

WARRICK & ANOR -v- BRYAN [2005] WASCA 70

Jurisdiction:	SUPREME COURT OF WESTERN AUSTRALIA	Citation No:	[2005] WASCA 70
Court:	THE FULL COURT (WA)
Case No:	FUL:131/2003	Heard:	1 OCTOBER 2004
Coram:	TEMPLEMAN J JENKINS J SIMMONDS J	Delivered:	13/04/05
No of pages:	29	Judgment Part:	1 of 1
Result:	Appeal allowed
Category:	B
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Parties:	JOHN GEOFFREY WARRICK JUDITH WARRICK MURRAY BRYAN
Catchwords:	Damages Tort Personal injury Family company in shop fitting industry Company income produced by respondents, other workers, subcontractors when required, and respondent's wife Loss of earning capacity Whether error in using respondent's pre-accident wage, his wife's pre-accident wage and all the company's profits to calculate respondent's lost earning capacity Practice and procedure Whether adjournment should have been granted due to late production of discoverable documents
Legislation:	Nil
Case References:	Husher v Husher (1999) 197 CLR 138 Mead Corp v Carbonless Papers (Australia) Pty Ltd [2002] WASC 268 Richardson v Whymark Nominees Pty Ltd [2004] WASCA 208 Andriolo v G & G Constructions Pty Ltd (1989) A Tort Rep 80-235 Bennett v Councillor [2001] WASCA 342 Browne v Dunn (1893) 6 R 67 Dal Zotto v Bonnani (1980) 47 FLR 239 Jones v Dunkel (1959) 101 CLR 298 Lago v Lago [1983] 2 Qd R 29 Lee v Sheard [1956] 1 QB 192 Marinovski v Zutti Pty Ltd & Panizutti [1984] 2 NSWLR 571 Metropolitan Police District Receiver v Croydon Corp (1957) 1 All ER 78 Pick v Wynes [1964] SASR 318 Randall v Dul (1994) 13 WAR 205 State of Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA TITLE OF COURT : THE FULL COURT (WA) CITATION : WARRICK & ANOR -v- BRYAN [2005] WASCA 70 CORAM : TEMPLEMAN J

JENKINS J
SIMMONDS J

HEARD : 1 OCTOBER 2004 DELIVERED : 13 APRIL 2005 FILE NO/S : FUL 131 of 2003 BETWEEN : JOHN GEOFFREY WARRICK

JUDITH WARRICK
Appellants (Defendants)

AND

MURRAY BRYAN
Respondent (Plaintiff)

ON APPEAL FROM:

Jurisdiction : DISTRICT COURT OF WESTERN AUSTRALIA

Coram : FRENCH DCJ

Citation : BRYAN v WARRICK & ANOR [2003] WADC 174

File No : CIV 1133 of 2001

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Catchwords:

Damages - Tort - Personal injury - Family company in shop fitting industry - Company income produced by respondents, other workers, subcontractors when required, and respondent's wife - Loss of earning capacity - Whether error in using respondent's pre-accident wage, his wife's pre-accident wage and all the company's profits to calculate respondent's lost earning capacity

Practice and procedure - Whether adjournment should have been granted due to late production of discoverable documents

Legislation:

Nil

Result:

Appeal allowed

Category: B

Representation:

Counsel:

Appellants (Defendants) : Mr J R Brooksby
Respondent (Plaintiff) : Mr K N Allan

Solicitors:

Appellants (Defendants) : Greenland Brooksby
Respondent (Plaintiff) : Ilberys Lawyers

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Case(s) referred to in judgment(s):

Husher v Husher (1999) 197 CLR 138
Mead Corp v Carbonless Papers (Australia) Pty Ltd [2002] WASC 268
Richardson v Whymark Nominees Pty Ltd [2004] WASCA 208

Case(s) also cited:

Andriolo v G & G Constructions Pty Ltd (1989) A Tort Rep 80-235
Bennett v Councillor [2001] WASCA 342
Browne v Dunn (1893) 6 R 67
Dal Zotto v Bonnani (1980) 47 FLR 239
Jones v Dunkel (1959) 101 CLR 298
Lago v Lago [1983] 2 Qd R 29
Lee v Sheard [1956] 1 QB 192
Marinovski v Zutti Pty Ltd & Panizutti [1984] 2 NSWLR 571
Metropolitan Police District Receiver v Croydon Corp (1957) 1 All ER 78
Pick v Wynes [1964] SASR 318
Randall v Dul (1994) 13 WAR 205
State of Queensland v J L Holdings Pty Ltd (1997) 189 CLR 146


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JUDGMENT OF THE COURT:

Introduction

1 This is an appeal and cross-appeal from a judgment given on 8 August 2003 by her Honour Judge French of the District Court on a trial for the assessment of damages of a personal injury following a trial before his Honour Judge Blaxell (as he then was) of that Court. Her Honour awarded damages under three heads. One was for past and future economic loss on account of loss of earning capacity, in the amount of $120,000. Another was for general damages for pain and suffering and loss of amenities, in the amount of $15,000. The third was for special damages, in the amount of $1,800, based on the sum that had been agreed. The appeal was against awards under the first two heads, while the cross-appeal was against the award under the first head.

Background

2 The appellants, the Warricks, who were defendants at the trial before French DCJ and Blaxell DCJ, were the operators of a tavern. The respondent, Murray Bryan, the plaintiff at those trials, was at the time of the accident a carpenter and joiner who for some years previously had been working in the area of shop-fitting, principally for one customer (Australia Post). His work had been through a company, M and A Bryan Pty Ltd, the initials being those of him and his wife. They, together with their son, were the directors and shareholders of the company. The respondent and his son were the principal workers for the company, with assistance from his grandson and subcontractors as required.

3 The respondent was a patron at the tavern operated by the appellants when, on 26 May 2000, he sustained injuries to both of his knees as a result of a fall caused by his tripping over a dog lying on the tavern floor. At the trial before Blaxell DCJ it was found that the respondent's injuries were due not only to the negligence of the appellants, but also to the contributory negligence of the respondent, to the extent of 25 per cent.

4 French DCJ determined that the accident had produced a condition of chronic pre-patellar bursitis. The symptoms were swelling and pain of the knees. These symptoms were particularly produced by the respondent working on his knees, as the company's business required, and the symptoms ultimately prevented him working at his pre-accident rate. French DCJ also determined that the respondent continued to experience pain symptoms which it was likely might be caused by changes in the patello-femoral joint that might well have been precipitated or

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exacerbated by the accident, as well as by the bursitis. She determined that the disability produced by these conditions was permanent.

5 In respect of the economic loss suffered by the respondent, French DCJ determined that the respondent's disability reduced his earning capacity, and this reduction had produced a decline in the profitability of the company. Although work from the main customer of the company had been in decline in the period leading up to and following the accident, the business would have found at least some other work had the respondent not suffered that loss of earning capacity. Replacing the respondent with other labour would have been commercially difficult because of the particular array of skills the respondent possessed. French DCJ determined that the decline in the company's profitability was not caused solely by the reduction in earning capacity, but that reduction was a substantial factor.

6 French DCJ also determined that the respondent's earnings should be calculated by reference to the company's profit and the wages paid to the respondent and his wife even although the respondent would not receive the whole of the profit. Her Honour referred to Husher v Husher (1999) 197 CLR 138 for this purpose. On the basis of a reference to this case, it would appear she determined as she did because of what she found was the respondent's control over that profit and those wages as the fruits of his labour. French DCJ then drew on closing submissions for the respondent to make the assessment she did of his economic loss. She drew on those submissions to determine the respondent's average earnings (the sum of the company's total profit and the wages paid to the respondent and his wife) pre-accident. However, she included one further year not used in the closing submissions so as to offset what she saw to be the inflation of the company's profit by another year that was used in those submissions. She used the figure so arrived at, first to calculate loss of earnings from loss of earning capacity for the period from the accident to a date about one month before she delivered her judgment.

7 Her Honour made further adjustments: to allow for the amount actually received by the respondent over that period, to recognise the other causes for the decline in earnings referred to (allowing 50 per cent only for the respondent's loss of earning capacity), and interest at 3 per cent. This produced a rounded off figure of $90,000. She also used the average pre-accident earnings figure to calculate future loss of earnings, assuming that the respondent, who was 67 at the time of trial before her Honour, would retire at the age of 70. She noted that for future loss there was, of course, no interest component, but also that the period

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for that future loss, three years, was longer than that for past loss, two years 10 months. She further assumed the profits of the business would remain at the same level as they had been for the period since the accident. She then reduced the amount so determined from $90,000 to $70,000, to allow for the contingency that the respondent might not be able to work for reasons other than his accident and for the possibility that the company's fortunes would improve in the following three years. She further reduced the total of past and future losses of $160,000 by 25 per cent for the respondent's contributory negligence, to produce the $120,000 we referred to previously.

8 In respect of the respondent's general damages, French DCJ awarded $20,000 for pain and suffering and loss of amenities, reduced to the $15,000 we referred to previously, so as to allow for the respondent's contributory negligence. Her Honour indicated that she accepted the respondent's submissions that the amount should not be reduced to reflect the respondent's reduced life expectancy because of his age, but she had also allowed for the likelihood that the respondent's symptoms would reduce significantly once he ceased work and was no longer placing stress on his knees.

9 In respect of the respondent's special damages, the trial Judge reduced the sum of $2,398 agreed by the appellants by 25 per cent for the respondent's contributory negligence to produce the rounded off figure of $1,800 we referred to previously.

10 The respondent's grounds of appeal focused principally on two matters. One was the introduction at trial, over the respondent's objection, of the significant qualification of the financial statements of the company and supporting documentation, as well as certain other documentation. The other matter was the determination of the respondent's economic loss by reference to the approach used in Husher (supra), which was said to be inapplicable, as well as aspects of the trial Judge's detailed application of that approach on the facts of the case.

11 The respondent's grounds of cross appeal focused on aspects of the trial Judge's detailed application of the Husher approach on the facts of the case.

Appeal Ground 1: the Refusal to Grant an Adjournment

12 This ground rested on the production by the respondent on 27 March 2003, the first day of trial, of three sets of documents, none of which had previously been discovered or otherwise provided to the appellant. Only

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the first two were the subject of this ground of appeal, but written submissions and oral argument went to all three, without objection from the respondent.

13 The first set of documents was a report dated 20 March 2003 of one of the respondent's accounting experts who testified at the trial; a Mr Somes, (the report was part of a set of reports from Mr Somes' firm that made up Ex 7 set out in AB 363 to AB 374, the relevant report being set out at AB 370 to AB 372 - 374). Among other things, the report referred to the need to correct the financial statements for the company for the year ending one month after the accident, 1999/2000, and those for the following financial year, 2000/2001 (see AB 371). The correction was to take into the earlier year, sales incorrectly allocated to the subsequent year. It was said that those sales had in fact been made in the prior year although payment had been made in the following one. The correction to the earlier year was to the profit and loss account, increasing sales, and to the balance sheet, increasing trade debtors. The correction for the following year was to the profit and loss account, decreasing sales by the same amount as the increase in prior the year's sales.

14 The changes were substantial. For 1999/2000, "Income – Gross Receipts – Total Income" went up by $61,964 (AB 371), from $381,755 (part of Ex 1 which was the respondent's book of financial documents set out in AB 375 through AB 485: the relevant part is at AB 420) to $443,719, while "Trade Debtors" went up from $7,600 (AB 422) to $69,564. For the following year, 2000/2001, "Income – Gross Receipts – Total Income" went down by the same amount, $61,964 (AB 371), from $431,830 to $369,866 (AB 441). This removed any suggestion from the accounts that the income of the company had risen in the year following the accident, notwithstanding it.

15 The second set of documents was made up of invoices apparently accompanying the Somes' report of 20 March 2003 (Ex 2 set out in AB 252 - 262). These were said to account for the changes to the financial statements referred to previously. The invoices bear dates of 6 June 2000, 19 June 2000 or 29 June 2000, and also bear notations of payment on 3 July 2000, 6 July 2000, 10 July 2000 or 13 July 2000, except for one invoice, dated 19 June 2000, for $6830, where the "Paid on" notation carries no date (AB 253). The invoices were said to be for work completed "prior to 30th June 2000", but included in the "2001 sales figure" (AB 371). The total work was said to be "$68,564" (AB 371). In fact, this figure is different from the total of the invoices in the appeal book, which appears to be $67,832, and no explanation for the difference

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is apparent to us. Further, it would appear from the Somes report of 20 March 2003, that in fact $7,600 of these invoices had been included in the earlier year's financial statements, because the increase in the "Income –Gross Receipts – Total Income" for that year was, as we have indicated, $61,964, which was stated to be "$68,564 minus $7,600 Trade normal debtor as per accounts" (AB 371). However, there is no single invoice in AB 252 through AB 262, nor, it seems, any combination of them, which is in the amount of $7,600.

16 The third set of documents, also apparently accompanying the Somes report of 20 March 2003, was quotations for work proposed to be done by the company bearing varying dates within the period 1 July 2002 to 31 December 2002 (Ex 2 set out in AB 324 – 342). These were apparently "unsuccessful quotes totalling $169,975" which were said to be "evidence" that "the drop in income after the accident is not due to an industry downturn but [the respondent's] inability to perform the work due to the accident" (AB 372 - AB 374). In fact the total of the invoices (Ex 2 as set out in the appeal book) is $175,554.50, not $169,975, and no explanation for the discrepancy is apparent to us.

17 French DCJ refused a request from counsel for the appellants, who was also their counsel on the appeal, to adjourn the trial to permit the appellants to properly consider the three sets of documents, such as by taking expert accounting advice on them. French DCJ's ruling was on the basis that the economic loss claimed, with respect to which the additional materials were said by the respondent to be relevant, was "comparatively … not that huge", and the costs of an adjournment relative to that claim would be significant (AB 612). However, her Honour left open the possibility of the matter being re-opened, depending on how the significance of the evidence emerged (AB 612). Subsequently, counsel for the appellants rose during the examination-in-chief of the accountant for the company, a Mr Snelgar, to remind the trial Judge, counsel did not renew his request for an adjournment, a matter he confirmed in the hearing before us.

18 The appropriate test to apply to questions of a kind raised by the original request for adjournment is that of weighing the prejudice to the party seeking it from its refusal, against the prejudice to the party resisting the adjournment from its grant, against the Court's expectation that the parties will use their best efforts and take all reasonable steps to ensure that they will be ready for trial: Mead Corp v Carbonless Papers (Australia) Pty Ltd [2002] WASC 268 at [87]. The balance would tilt in favour of adjournment where material arose at trial that took a party by

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surprise through no fault of theirs: "Civil Procedure in Western Australia", par [34.4.1].

19 Before us, it was said that the three sets of documents significantly altered the respondent's case, although it was conceded that the appellants had not renewed their request for an adjournment notwithstanding what we were told were the difficulties counsel for the appellants was experiencing in dealing with the evidence. The respondent's case, so far as it was apparent to the appellants before the new documents were put up, was, it was said, a claim for economic loss either on the basis of lost wages or the cost of taking on subcontractors to cover for the respondent. The case which the new documents assisted the respondent to make, and which the learned trial Judge accepted, was that the earnings of the respondent over which he had control were less by reason of his accident. In addition, it was said, had the appellants been given more time to consider the change in the item Trade Debtors for 1999/2000, a change that gave that item a value dramatically larger than the largest such figure in the financial statements of the company for the other years for which there were statements (the $7,600 figure that the much larger one replaced), the appellants would have been led to consider whether their assumption, based on the small size of the values otherwise, that the financial statements were consistently prepared on a cash receipts basis at least as to income, needed further investigation. This, in turn, might have revealed a larger problem with the veracity of those financial statements.

20 In respect of the first two sets of documents, which, it can be seen, are connected, counsel for the appellants relied principally on the opportunity he said he was denied to investigate whether the misallocation revealed a larger problem with the veracity of the financial statements. The respondent's position, as expressed in the Somes report of 20 March 2003, was that the misallocation was the result of the "paperwork getting behind after [the respondent's] accident" (AB 371). More importantly, it seems clear that the possibility of sales of this total magnitude for which receipts were shown in the first quarter of 2000/2001 having been made in the previous financial year was drawn attention to by the expert retained by the appellants prior to the trial before French DCJ to examine the financial records of the company. Reference for this purpose was made to the report of a Mr Burns dated 17 March 2003, who testified at the trial before French DCJ, to solicitors for the appellants (part of Ex C which was a series of such reports set out in AB 343 through AB 362: the part that was particularly relevant was at AB 355). This report analysed the business activity statements of the company for the first quarter of 2000/2001, as well as other financial records the company made available

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to Mr Burns. Mr Burns was available to counsel for the appellants throughout the trial. Mr Burns, in his report, was considering whether or not there was substance in the respondent's suggestion that (unadjusted) income had increased in the financial year after the respondent's accident because of the introduction of a GST into Australia's tax system commencing with taxation year 2000/2001. The suggestion was that this introduction had led buyers to defer purchases into 2000/2001 to capitalise on tax savings the GST effected. Mr Burns, in his report, noted that the company's inaugural BAS for the first quarter of 2000/2001 showed sales on which GST had been charged of $88,125, with total receipts in the quarter of $144,192. This "would mean that of the total receipts for July to September 2000 $56,067 are receipts from sales made prior to 30 June 2000 in which there was no obligation to charge GST" (AB 355), from which he concluded (using calculations at AB 356) that any effect on the net income of the company deferring purchases as claimed "would not be significant" (AB 357). Although the point is not made explicit, recognition of this would presumably have entailed a restatement of capital trade debtors for 1999/2000 by a significant amount.

21 While the amount of $56,067 is about $5,000 less than the amount of the adjustment to sales for the previous financial year called for by the new documents, it seems to us to be difficult to say that the appellants were taken by surprise by the need to consider that sales in the previous year had in fact been greater, by a sum of the order of magnitude of the adjustment, than the figure initially claimed by the respondent. If that is so, then it seems to be difficult for the appellants to say that they were prejudiced because they were denied an opportunity to pursue large problems with the financial statements. This is especially the case when the appellants did not renew their request for an adjournment, although this possibility had been allowed for by the trial Judge.

22 Whether the profit and loss account was prepared on a receipts or an accruals basis was a different matter. The Burns report referred to, expressed the author's view that the sales figures were "totals of amounts banked, not of amounts invoiced" (AB 356), that is, the profit and loss accounts had, in his view, been prepared on a receipts, not an accruals basis, at least as to sales income. The importance of the difference was said to go to the basis of the economic loss claimed by the respondent, which emerged at trial as going to the loss to the company as the measure of the loss of earning capacity of the respondent, as we have indicated previously. The appellants put it to us that the adjustment was the first indication that the respondent was in fact proceeding on this footing at the

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trial, when up to that point loss of wages, measured directly or by reference to a cost of subcontractors to cover for him, appeared to be the basis for the respondent's claim for economic loss.

23 However, it seems to us that the impact on the company (if any) of the injury to the respondent had been the subject of close analysis in the reports of Mr Burns to which we have referred. Given that, and the appellants' failure to press for an adjournment to which we have also referred, prejudice does not seem to us to be made out.

24 The quotations introduced at the trial raised different issues. They went to the causes of the downturn in the company's business during 2001/2002 and 2002/2003, a downturn accepted on all sides. The respondent's claim was that the downturn was due to his inability to work at pre-accident efficiency levels. A report by Mr Burns of 4 March 2003 noted this claim, and also that the author could see "no evidence in the documents, which we have examined to be able to comment on the reason for the decline in sales for 2002 and 2003" (AB 349). The quotations subsequently introduced were in fact being relied upon as such evidence (the Somes report of 20 March 2003, AB 372 – AB 374).

25 It should be noted that the appellants did not renew their request for an adjournment at the trial with reference to these documents, in particular when those documents were being dealt with in the examination-in-chief of the respondent and tendered into evidence then (AB 57 to AB 61). In fact, counsel for the appellants had at that time (AB 61) sought successfully to have included with the quotations a letter in relation to a government project from a company seeking that project for which one of the quotations was prepared, indicating that the project had not been proceeded with apparently because "all tenders were substantially higher than the pre-tender estimate" (AB 59: the letter itself was not, however, included in the appeal book).

26 It seems to us that the evidence in relation to the quotations was indeed of some significance to the trial Judge. She referred to the reliance the respondent had placed on the quotations as "reflective of the impact that his injuries would have had on the profitability of the business" (AB 22, judgment at [21]). She later indicated her acceptance of "the [respondent's] evidence that someone of his experience and expertise would have been able to obtain work from alternative sources if the quotes were competitive" (AB 23, judgment at [24]). However, against the backdrop of what occurred at trial, the introduction of these quotations and their later tender, it seems to us to be difficult to find any prejudice to

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the appellants made out here sufficient to uphold this ground of appeal in relation to those quotations.

27 Accordingly, we would not uphold ground 1 of the grounds of appeal.

Appeal Ground 2: the Finding that the Profit and Loss Accounts were prepared on an Accruals Basis

28 This was said to be an error, apparently because of the weight of the evidence, which, it was suggested, supported the view contended for by the appellants' expert at trial, Mr Burns, that the profit and loss accounts were in fact prepared on a receipts basis, at least as to sales income.

29 However, what seems to us to be an insuperable difficulty for the appellants is that the trial Judge herself appeared to consider these matters. In particular, she considered the support for the Burns view and the financial records of the company (AB 21, judgment at [20]), presumably by reference to the lack of any figure or any substantial figure for trade debtors in all other financial years than 1999/2000, a year for which the adjustment and trade debtors was made as we have explained previously. The trial Judge appears to have accepted both the evidence that the invoices that produced the 1999/2000 and 2000/2001 adjustments referred to previously, had been sent out late owing to the respondent's accident, and the testimony of the accountant, Mr Snelgar, who had prepared the accounts, that they had all been prepared on an accruals basis. In these circumstances it seems difficult for an appeal court to come to a different view of the evidence.

30 The trial Judge's finding as to the accruals basis for the accounts was of some importance to her determination of the respondent's economic loss, past and future. This was because of the use of the adjusted 1999/2000 profit figure in determining the average pre-accident earnings figure for the respondent. We shall return to this matter in considering ground 4.

Ground 3: General Damages of $20,000 Manifestly Excessive

31 This ground was based on the claim that the evidence was that the majority of the respondent's permanent disability could not be related to the accident. This ground, we were told in argument before us, also related to the economic loss claim as it would scale down the extent to which the loss of earning capacity relied on by the trial Judge on the balance of probabilities should be attributed to the accident.

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32 There was evidence the trial Judge accepted, evidence that was not challenged before us, that the respondent's capacity for work was reduced because of the pain kneeling caused him. This pain had caused him in late October 2000, five months after the accident, to return to the orthopaedic surgeon, a Mr Sneddon, who testified at the trial, and who had previously examined him on two occasions, the second in late August 2000, two months after the accident. Mr Sneddon had an MRI scan done, and reported in January 2001 that the MRI confirmed the symptoms the respondent was reporting were due to pre-patellar bursitis (AB 141 to AB 142). There was considerable dispute at trial as to the extent to which the respondent's continuing inability to work by kneeling at the rate before the accident was due to the accident bringing on pre-patellar bursitis, or whether it was due to a chronic pre-accident condition in the form of pre-patellar bursitis which was initially exacerbated by the accident but resolved subsequently (because kneeling was reduced).

33 There was, however, a further dispute at trial as to another knee-related condition which was diagnosed subsequently to pre-patellar bursitis, following the respondent seeing Mr Sneddon again in late July 2002, and a further MRI scan being taken. This other condition was one which appears to have affected not so much kneeling as knee flexing of the sort in the respondent's work resulting from ascending and descending trestles or ladders.

34 There was evidence from Mr Sneddon that this other condition apparently had a precursor in degenerative changes in the patello-femoral joint, a condition which had been identified in the MRI scan following the October 2000 consultation, but which had not been referred to in the January 2001 report. This lack of reference was despite the fact Mr Sneddon said that he had the scan done because he thought some symptoms were arising from the patello-femoral joint (AB 140). However, while the scan had shown "low grade cartilage thinning of the patella", the scan had not shown any physical effects of the accident to account for any pain from the joint. Mr Sneddon further testified that he thought even then that some of the symptoms were associated with the joint (AB 142), but apparently he had not reported on this at the time as he "didn't think" the joint condition was "significant in relation to the bursitis" (AB 141). However, in his report on the second MRI scan, Mr Sneddon said that "low grade patellofemoral chondral degenerative change similar to previously seen on the MRI scan is still present but there is now a new area of articular cartilage fissuring in the central region of trochlear groove" (AB 306). That same report went on to say that this "would suggest the previous injury has resulted in degenerative changes

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which are now becoming apparent" and concluded that "his present symptoms are coming from the patellofemoral joint with demonstrated articular cartilage degenerative changes rather than the previous prepatellar bursitis" (AB 306).

35 We were not directed to any evidence that separately quantified the effect over time of the pre-patellar bursitis and the patello-femoral joint conditions on the respondent's symptoms or on his work patterns. As to the symptoms, there was, however, Mr Sneddon's testimony which indicates that the contribution of the patello-femoral joint to his symptoms at the end of 2000 was relatively slight, as we have indicated; while "not all, but the majority of his symptoms", at least at the time of the August report, "were coming from the patello-femoral joint" (AB 143). As to his work patterns, there was Mr Sneddon's report of 25 March 2003 that the respondent no longer worked on his knees and had limited use of trestles and ladders (AB 307).

36 In determining the effects of the accident, the trial Judge relied on the evidence from the respondent that he had no problems with his knees before the accident, and the evidence of Mr Sneddon, who also drew on such a reported history. The trial Judge concluded that the respondent's symptoms were caused by the accident (AB 19, judgment at par 15). She went on to say (AB 19, judgment at par 15):

"I am satisfied that the plaintiff's symptoms are a consequence of the injury he sustained on 20 March 2000. Although Dr Sneddon considers that it is unlikely that his present symptoms may also be caused by changes in the Patellar [sic] femoral joint as well as the bursitis I accept his opinion that those changes may well have been precipitated by or exacerbated by the fall."

37 The trial Judge further accepted the evidence of both Mr Sneddon and the appellants' orthopaedic expert, a Mr Alexeef, that the respondent had a permanent disability of 5 per cent in both his left and right legs associated with the conditions in his knees (AB 19, judgment at [16]). Mr Sneddon's assessment of a continuing or ongoing disability of 5 per cent of the whole of his left and right legs appeared in his report following the October 2000 consultation (AB 142), where, as we have said, there was no mention made of any patello-femoral joint condition, and appeared again in a subsequent report made following a consultation on September 2001 in which the respondent had apparently reported to Mr Sneddon he was avoiding kneeling or squatting (AB 303). It does not

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re-appear in any of the reports following the still later diagnosis of the patello-femoral joint condition, although Mr Sneddon's testimony would suggest it continued to apply (AB 141, AB 142).

38 No issue was taken before us with respect to the trial Judge's conclusions as to the pre-patellar bursitis. However, counsel for the appellants, submitted that the difficulty with the determination of the trial Judge was that Mr Sneddon's evidence on causation of the condition of the patello-femoral joint that was producing the respondent's symptoms had, it was said, been substantially qualified at trial.

39 In his examination-in-chief, Mr Sneddon said (AB 144):

"But at no time when I saw him was he free of - basically free of symptoms.

Yes?---So irrespective of what he suggests, I believe that he had a prepatellar bursitis from the fall and can say, 'Sure, after 3 years of ongoing symptoms you can call it chronic rather than acute situation,' but I think it was acute when I first saw him because it had only been present for some months but as time goes by and the months turn into years then I would accept that it then is a chronic situation and subsequent MRI scans have confirmed that with time there has been demonstrable radiological change in the patellofemoral joint which would probably now be classified as arthritis which may well have been precipitated or come on sooner than otherwise would have happened by the fall.

Okay?---Now, I can't prove that.

Right?---But that's how I have interpreted the sequence of events that have occurred."

40 However, considerable emphasis was laid by counsel for the appellants in the cross-examination of Mr Sneddon on the symptoms of pain from the patello-femoral joint as they first appeared to him and subsequently. This cross-examination was said to have produced a withdrawal of any opinion expressed by Mr Sneddon as to causation of those symptoms by the accident on the balance of probabilities.

41 To consider the point, it is necessary to set out the relevant passage of Mr Sneddon's cross-examination in full (AB 149 to AB 151):

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"You found a mild degree or [sic] degeneration behind the kneecap?---Yes.

That degeneration wouldn't have been caused by the accident, would it?---It's unlikely that it was caused given that there was no MRI evidence of bone marrow oedema or fracturing or fissuring of the cartilage. It may have been the case that a degenerative condition that previously had been asymptomatic became symptomatic by him falling over. I can't answer that.

But if it had, you would have expected symptoms earlier?---Yes. I would have expected MRI changes.

You didn't find them?---Yes.

In fact, according to the MRI, certainly in relation to the left knee - I haven't picked it up in the right - the condyle degenerative change in comment 2 involving the patella and medial compartment appearances have not altered appreciably since the previous examination. So there's been no advancement of any degenerative condition?---Yes.

I see. You have identified a new central trochlear fissure in the right knee and comment 2 when the radiologist referred to it and I think you have mentioned that in your report of 8 August. I was wondering where that came from. So there is now a new area of articulate cartilage fissuring in the central region of the trochlear groove. So in relation to the left knee the degenerative condition hasn't advanced but you postulate that this fissuring in the trochlear groove is evidence of a degenerative change resulting from the accident?---His symptoms changed with time and as they changed with time I felt that the symptoms were becoming more consistent with pain arising from patellofemoral joint which is why I had a further MRI scan done.

Right, yes?---And I can't tell you as to whether those changes on the second MRI scan as compared to the first MRI scan of his right knee have come about as a natural deterioration of a previously asymptomatic degenerative condition or as a result of a previously asymptomatic degenerative condition becoming symptomatic as a result of a fall. I can't answer that question but I can say that the symptoms at this time when the second MRI scan was done were far more in keeping with the problem from the patellofemoral joint."

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42 It is undoubtedly the case that in order to sustain the trial Judge's determination as to the respondent's continuing disability - at least once the patello-femoral joint became the principal source of his symptoms - it was necessary to find that the condition of the joint that had that effect was, on the balance of probabilities, a result of the accident. It is further the case that the language of Mr Sneddon's examination-in-chief, "may well have been precipitated or come on sooner than otherwise would have happened by the fall," which, as has been seen, was, in effect, adopted by the learned trial Judge in the passage above (AB 19, judgment at [15]), is not a straightforward statement of causation to that effect.

43 However, we believe it is necessary to read that passage from Mr Sneddon's examination-in-chief in the context of his report of March 2003 with its language indicating that the change in condition of the joint indicated by the second MRI scan "would suggest that the previous injury has resulted in degenerative changes which are now becoming apparent", as well as the immediately following exchange in Mr Sneddon's examination-in-chief of: "Okay?---Now, I can't prove that. Right?---But that's how I have interpreted the sequence of events that have occurred".

44 When that passage is so read, we consider there is evidence on which the finding of causation could be and, in our view, was made.

45 Nor do we consider that the cross-examination did more than highlight the difficulty Mr Sneddon felt in relying for his causation conclusions on the MRI's. It seems to us that the cross-examination does not disturb any other bases for his view, and one other at least had been referred to. It was "the sequence of events that have occurred", which we consider was properly understood by the trial Judge to be a reference to "his clinical observations and the plaintiff's history" (AB 17, judgment at [11]). The "history" would seem to be a reference to matters, including a history of the absence of problems related to his knees reported by the respondent who had been working for many years and at the date of the accident was aged 64.

46 Thus, we would not uphold ground 3 of the grounds of appeal.

Appeal Ground 4: the Respondent's Economic Loss

47 It is not in dispute that the learned trial Judge applied the principles from Husher (supra) in determining her approach to the respondent's economic loss claim. At [25] of her reasons she said:

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"I accept that it is appropriate to calculate the plaintiff's earnings on the basis of the company profit and the wages paid to the plaintiff and his wife in the relevant years. Although the plaintiff will not receive the whole of the profit it nonetheless reflects a loss of earning capacity in accordance with the general principle (see Husher v Husher (1999) 197 CLR 138)."

48 With respect we do not agree that the facts of this case were so similar to the facts in Husher that the principles enunciated in that case applied here.

49 The injured appellant in Husher's case, who we will call Mr Husher, was a partner with his wife in a partnership determinable at will. He was a blocklayer and the sole worker for the partnership. His wife's only contribution to the partnership was to perform some minor bookkeeping and message taking tasks, which contribution the High Court described as "negligible". Thus it was Mr Husher's skill and labour which generated income for the partnership. The partnership ceased operations 18 months after Mr Husher's accident because he could no longer physically perform his work.

50 In the joint judgment of the majority of the High Court their Honours said [22 – 23]:

"No true comparison can be made between this case and that of a person expected to remain a member of a partnership not terminable at will or a partnership in which persons other than the injured plaintiff contribute significantly to the firm's business activity, either by capital contribution or by contribution of skill and labour. In those cases other considerations intrude in deciding what is the loss occasioned by the impairment of the plaintiff's future earning capacity. In at least some cases of the kinds mentioned it may be that the plaintiff's probable exploitation of earning capacity to generate income over which the plaintiff would have had control would be limited to the amount of the benefits the plaintiff could have expected to receive under the partnership arrangements (for as long as those arrangements were likely to have persisted) but each case will turn on its own facts.

The importance of the facts in each case

Deciding what value is to be ascribed to the loss of future earning capacity of an injured plaintiff requires close attention

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to the facts of each case. The task is not one to be undertaken by seeking to classify cases as concerning 'sole traders' or 'partnerships' or 'wage-earners' or 'trading trusts', and then attempting to deduce some rule of general application to all cases falling within the classification thus devised. Rather the inquiry is about what could the plaintiff have done in the workforce but for the accident and what sum of money would the plaintiff have had at his or her disposal. Only when those inquiries are pursued can a judgment be made about what capital sum to allow as damages for the impairment of the plaintiff's earning capacity. In doing so, regard must be had, of course, to all those contingencies of life that might reasonably be expected to affect the course of events in the future."

51 In our opinion the trial Judge was wrong to equate the facts of this case with those in Husher and thus to calculate the respondent's economic loss on the basis of the combined value of the respondent's wage, his wife's wage and the whole of the company's profit.

52 The facts of the two cases are markedly different. The respondent is a director and shareholder in a family company. He, his son and wife are directors of the company. The only evidence of the shareholding in the company was in the Somes report of 22 January 2003 (part of Ex 7 to which we earlier made reference). That evidence is of a "third share of the business" having been sold to the respondent's son in December 1995 and the reasonable inference to draw from the evidence, which was not challenged, was that all three are shareholders. The respondent, his son and grandson all work for and draw wages from the company which carries on business as shopfitters and cabinetmakers. The company also engages subcontractors as and when required and the respondent's wife does the banking, the books and types the accounts. Up until six months before the accident she had drawn a wage, albeit less than the other family members, as remuneration for this work. The reason she ceased to do so was apparently a combination of her intention to retire and the inability of the company to meet her wages.

53 In Mr Husher's case it was said that it was his earning capacity which generated all the income of the partnership. The same cannot be said of the respondent. The income of the company is the product of the exploitation of the earning capacity of the respondent, two other fulltime workers, subcontractors, as and when required, and the respondent's wife. Consequently, in our opinion, the trial Judge fell into error in determining the measure of the respondent's lost earning capacity by reference to the

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sum of the respondent's pre-accident wage, his wife's pre-accident wage and all the company's profits.

54 It is true that the evidence of the Somes report of 22 January 2003 is that the respondent's son had "no effective control over the business" and had not paid for his third share in the company which was sold to him in December 1995. However, this evidence does not alter our previously expressed opinion. Adopting the words of the majority in Husher's case at [18], what the trial Judge was obliged to determine was the respondent's financial loss occasioned by impairment of his earning capacity as a consequence of his accident. That loss was what the respondent (if there had been no accident) would have expected to have under his control and at his disposal by exercising that capacity. In Husher's case the High Court determined that Mr Husher would have, as the fruits of his labour, the whole of the net profit of the partnership. This was because the whole of the income of the partnership came from the exploitation of his earning capacity. Secondly the partnership was a partnership at will and could therefore be dissolved "whatever view his wife may have held".

55 In this case, however, if the accident had not occurred, the respondent would have expected to have his wages under his control. It seems that he was also entitled at law to a third of the profits of the company. There is no evidence that this position at law was altered by any trust or other arrangement with the other directors or shareholders.

56 As to the respondent's wife's wage, as a matter of commonsense, a business having a turnover of approximately $500,000 per year which employs staff and purchases materials to be used in the construction of shop fit outs would require at least a part-time office worker to do the work the respondent's wife did. This is not a case where the wage paid to the wife can be described as being for "negligible" work and consequently the wage of the wife attributed solely to the respondent as part of the fruits of his labour.

57 We would allow the appeal on the basis of the error identified in ground 4. Unless the learned trial Judge's assessment is fair and reasonable, although not derived from the application of the appropriate principles, this Court should reassess damages for economic loss.

58 Using the approach in Husher's case the respondent's expert stated that the respondent's net income prior to the accident was $86,394 per annum. The trial Judge reduced this figure to $80,000 to take into account an above average year that had been used to calculate the average. She

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then multiplied this figure by two years and 10 months, the period of the past economic loss, and came to $226,000 as representing the respondent's potential past earnings were it not for the accident. The trial Judge then subtracted the respondent's actual earnings of $59,506 to arrive at a total of $166,500. Her Honour then reduced this by 50 per cent to take into account that company profits were falling for reasons other than the respondent's incapacity. The final rounded off figure for past economic loss was $90,000.

59 If the learned trial Judge had approached the assessment in what in our view is the correct manner, she would have averaged the respondent's net annual wages over the three years before the accident ($33,904). This figure represents what the respondent could have earned in wages per year were it not for the accident. The trial Judge calculated past economic loss over a period of two years and 10 months at $33,904 per annum to be $96,061. To determine the respondent's net loss of wages she would have deducted from this figure the respondent's actual earnings over the two years and 10 months between the date of the accident and the date of the assessment. The respondent's actual net wages were $94,074, resulting in net loss of wages of $1988, rounded up to the nearest dollar. It could be argued that this relatively small loss in wages indicates that the respondent did not suffer a diminution in wages earning capacity over this period. However given the trial Judge's finding that he did sustain a loss of earning capacity (AB 19, judgment at [16]) and there being no other explanation for this loss, we are prepared to attribute it to the respondent's accident and the loss of earning capacity he sustained as a consequence.

60 It is necessary to add to this figure any loss in returns from the company due to the accident. The respondent's share of the company's average net annual profits for the three years preceding the accident was $10,702 or $30,323 over two years and 10 months. This is the amount the respondent could have expected to receive in company profits were it not for the accident and any further downturn in company business. We will shortly return to the adjustment which has to be made to take this latter aspect into account. In fact, the respondent's actual share of the company's losses between the date of the accident and the date of the assessment of damages was $11,522. He therefore suffered a total loss of $41,845.

61 However the trial Judge found that only 50 per cent of the company's losses over this period were due to the respondent's accident and that 50 per cent were due to a continuing downturn in the company's business (AB 24, judgment at [26]). It is therefore necessary to halve the figure of

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$41,845 to take these findings into account. Thus the net loss of company returns should have been assessed at $20,923, rounded up to the nearest dollar.

62 The addition of the two components of the respondent's past economic loss results in a loss of $22,911. The respondent is entitled to interest at 3 per cent per annum, resulting in an amount of $24,973. A further reduction of 25 per cent is required to take into account the respondent's contributory negligence. Thus in our opinion the trial Judge's assessment should be replaced by $18,730 rounded up to the nearest dollar.

63 With respect to the calculation of future economic loss, for the reasons given earlier the starting figure of $126,366 (the combination of net wages and company profits over the three years before the accident) over two years and 10 months or $860 per week net, should have been used as the respondent's potential earnings. This must be reduced to reflect the respondent's retained earning capacity. The wages the respondent received after the accident indicate that he has a significant retained earning capacity. However, the losses the company suffered in 2002 and 2003 tend to indicate otherwise, even accepting, as we do, the trial Judge's finding that 50 per cent of those losses were due to a non-accident related downturn in the company's business. The respondent, who the trial Judge accepted was a credible witness, said he was "running at 60 per cent". For the purposes of this assessment we accept the trial Judge's finding of fact to the effect that the respondent's symptoms are a consequence of the injury he sustained in the accident. We also take into account the trial Judge's opinion at [15] where she said:

"While it may be that the plaintiff could have developed prepatellar bursitis and degenerative changes in the patellar femoral joint independently of the accident that is something that can be taken into account by way of an allowance for contingencies. It is however the case that that allowance should be relatively modest as at the time of the accident the plaintiff was aged 64 and despite the fact he had placed considerable stress on his knees as a result of his work he was fit and active and had no difficulty or symptoms from his knees throughout his working life."

64 She further found at [16]:

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"I am satisfied that the plaintiff's disability is permanent and he has sustained a loss of earning capacity. I also accept that although that was assessed by both Dr Snedden and Dr Alexeeff as being five per cent disability of the whole of his left and right leg its effect on his working capacity is significant due to the nature of his work."

65 As a consequence of the manner in which the trial Judge assessed damages, she did not determine the percentage by which the respondent's earning capacity had been reduced due to the accident. However, at [26] she did find that it was appropriate to attribute 50 per cent of the respondent's loss of earnings (which she had assessed by looking at the combined earnings of the company, the respondent and his wife) to the respondent's reduced earning capacity as a result of his injuries. Further, the respondent gave evidence that the company was lucky to get 40 – 50 per cent of the jobs for which it was currently tendering. He put this down to the fact that the company had to quote a higher price because he did not have the ability to do the work; and those with whom the company contracted as his replacements, were paid at a higher price.

66 Taking all these matters into account our view is the respondent has a 40 per cent retained earning capacity. We accept that this earning capacity is not reflected by either the wages the respondent was drawing at the time of trial or the losses the company was incurring at the same time. The company's position results not only from the respondent's accident but also, as the trial Judge found, from a general downturn in its business.

67 Reducing the sum of $860 per week by 40 per cent results in the figure of $516.

68 The trial Judge determined that the respondent would have continued to work to 70 were it not for his accident. Thus she assessed damages for a period of three years. Using the appropriate multiplier of 144, we obtain the figure of $74,304. We do not accept that there should be any deduction for contingencies. This is, first, because of the trial Judge's findings that only a modest allowance should be made for the risk that the respondent would have developed a knee disability if the accident had not occurred. Secondly, three years is a relatively short period of time and thus there is a low risk of negative contingencies occurring in this period: there is no evidence that the respondent suffers from any other illnesses or disabilities. Further, whatever risks there are, are balanced out by the possibility that the business' fortunes will improve in that three years,

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given that in the past it is has managed to trade quite profitably. However, the figure of $74,304 must be reduced by 25 per cent, to take into account the finding of contributory negligence, to $55,728.

Appeal Ground 5

69 Ground 5 is in the following terms:

"The learned trial Judge failed to take properly into account or at all, that the Company had lost between 60% and 70% of its business shortly prior to the accident by reason of its main provider of work, Australia Post, ceasing to provide work to the Company."

70 In our view, this ground is misconceived. Although it is asserted that the company had lost that substantial portion of its business shortly before the accident, that assertion was not proved as a fact. Indeed, it was contrary to the weight of the evidence.

71 It was accepted by the respondent in cross-examination that for the year ended 30 June 2002, Australia Post represented 59.2 per cent of his (ie the company's) total sales. A little later, it was put to the respondent that a Mr De Vries, representing one of Australia Post's contractors, would say that the work Australia Post had been putting out for shop fitting had "fallen away dramatically in the last three years" (AB 72-3). The respondent accepted that the work he obtained from Mr De Vries' company had "dropped off", but said that Mr De Vries was not concerned with the smaller shop-fitting work the respondent carried out for Australia Post.

72 Earlier in his cross-examination, it had been put to the respondent that if Australia Post was to cut down on its shop fitting activities, he would suffer very significantly. The respondent replied that if Australia Post cut down, he would look for other work. A little later, the respondent denied that he was dependent on work from Australia Post. He said he was able to get work elsewhere (AB 70).

73 In fact, Mr De Vries did not give evidence: nor was any evidence given to the same effect as that foreshadowed.

74 Included in the passages from the trial Judge's reasons we have set out above, is the following finding which is relevant to this issue:

"Although the work from Australia Post may have reduced significantly I accept the [respondent's] evidence that someone

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of his experience and expertise would have been able to obtain work from alternative sources if the quotes were competitive." (Reasons [23])

75 For these reasons, we conclude that ground 5 should be dismissed.

Appeal Ground 6

76 Supplying the opening words which appear to have been omitted inadvertently, ground 6 would read:

"[The learned trial Judge] awarded economic loss on the basis of a figure of $80,000.00 per annum (nett) without identifying how that figure was calculated or upon what basis it was awarded and without taking into account:

(a) company tax on undistributed profits;

(b) income tax payable in the respondent (plaintiff)'s hands;

(c) any adjustment for unpaid accounts at the end of the 1999/2000 financial year or in the 2000/2001 financial year;

(d) the potential cost of replacement labour;

(e) the work done by the other Directors."

For the reasons given above, we do not accept that the trial Judge should have adopted the figure of $80,000 referred to above.

77 However, we do not accept that the basis for the award for damages was obscure. In our view, it is clear from the trial Judge's reasons, how her Honour arrived at that figure.

78 In essence, the Judge accepted Mr Somes' evidence that the average for the years 1998 – 2000 of the total of the company profit and the wages paid to the respondent and his wife was $86,394.

79 As appears from Mr Somes' calculations, which were included in the respondent's submissions at trial, this figure was net after deduction of income and company tax.

80 The trial Judge then adjusted the $86,394 to $80,000, to take account of her view that the company profit for 1998 had "somewhat inflated" the average.

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81 Thus, the respondent's pre-injury earnings provided the basis for the assessment of his post-injury earning capacity. However, it was necessary to deduct, as her Honour did, the amounts actually earned by the respondent in the exploitation of his reduced capacity.

82 It is therefore clear that grounds 6(a) and (b) are factually incorrect. As to 6 (c): it would have been inappropriate to make the adjustment there referred to, because the assessment involved averaging income calculated on an accruals basis. As to 6(d) and (e): both the potential cost of replacement labour and the value to work carried out by others were incorporated in the actual post-injury earnings.

83 We would therefore dismiss ground 6.

Appeal Ground 7

84 At the commencement of the appeal, counsel for the respondent was permitted (without objection) to add the following additional ground:

"In the premises there was no evidence or alternatively no acceptable evidence of the Respondent (Plaintiff) having sustained any economic loss as a result of the accident."

Counsel said that this ground "is filed essentially as an abundance of caution" (TS 2).

85 Counsel's point was that if the Court accepted his submissions about the inapplicability of Husher v Husher (supra), there was no other basis on which the respondent's economic loss could be assessed.

86 For the reasons we have given in respect to ground 4, we do not accept the respondent's proposition that "there was no evidence or alternatively no acceptable evidence of [the respondent] having sustained any economic loss as a result of the accident". There was, however, an alternative method to the method adopted in Husher's case which the trial Judge should have used to assess the respondent's economic loss. Her Honour's assessment was excessive as compared to this method and the assessment of damages should be adjusted accordingly.

87 We do not accept that the only appropriate way to assess damages in a case like this is by the cost of replacement labour. As the learned author of Luntz, "Assessment of Damages for Personal Injury and Death", 4th ed, 2002, says at [5.5.1]:

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"The requirement to mitigate the loss would ordinarily mean that the damages under this head cannot exceed the cost of employing someone to do the work that the injured plaintiff is unable to do."

88 Whilst this is the "ordinary" rule, we do not accept that it is an inviolate rule. The respondent gave evidence that, in effect, replacement labour was too expensive and it increased the price of the company's tenders to a point where they were non-competitive. Consequently, employing replacement labour did not mitigate his loss. He was entitled to have assessment of damages on the basis of his lost wages and loss of profits attributable to the diminution in his earning capacity. As we have demonstrated above, there was evidence about these matters before the trial Judge upon which an assessment on this basis could be made.

The Cross-Appeal

89 Cross-appeal ground 1(a) challenges the trial Judge's reliance on $80,000 per year as the respondent's pre-accident earnings as opposed to $86,394 being that determined strictly by reference to the figures produced by Mr Somes. For the reasons we have given with respect to ground 4 we agree that the figure of $80,000 should not have been used. But neither do we accept that the figure of $86,394, should have been used: both figures were excessive. We have substituted our own assessment of damages for economic loss. Consequently cross-appeal ground 1(a) falls away.

90 Cross-appeal ground 1(b) challenges what the respondent calls the arbitrary reduction of 50 per cent of his past economic loss. Again, for the reasons we have given with respect to ground 4 of the appeal, a reduction of 50 per cent in the gross past loss could not be justified. However, for the reasons given by the trial Judge we are of the view that there was evidence that entitled her Honour to conclude that only 50 per cent of the fall in company profits was attributable to the respondent's accident. We have taken this finding into account in our own assessment of damages. Consequently we would not allow this ground of cross-appeal.

91 Cross-appeal ground 1(c) challenges the assessment of past loss of earning capacity from 1 July 2000 to 1 May 2003 only, rather than to the date of judgment, being 8 August 2003. In Richardson v Whymark Nominees Pty Ltd [2004] WASCA 208 at [282- 290], Jenkins J reviewed the relevant authorities relating to the appropriate date for the assessment of damages in a personal injury case. At [289] she concluded that the

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general rule is that damages are assessed as at the date of the verdict. In earlier times that date would have been likely to have been the concluding day of trial but there is now no reason it could not be the date of delivery of judgment. At [290], Jenkins J said that this general rule must give way to the overriding principle that the purpose of an award of damages is to fairly compensate the respondent for the wrong he or she has suffered. If the choice of another date of assessment will do that better, then it is within the discretion of the trial Judge to use it.

92 In the same case, Malcolm CJ at [191] stated that in his view the calculation of future loss of earnings should be made as from the date of commencement of the trial, or, more accurately, the day after the date on which past loss was calculated. Steytler J at [277] concluded that the determination is required to be made at the conclusion of evidence in the trial. However, his view, more so than that of Jenkins J and perhaps Malcolm CJ's, was based on an analysis of the statutory provision which was then being considered.

93 All the views expressed in Richardson were obiter. However, they show the diversity of judicial opinion on this issue. In light of that diversity we would not be prepared to hold that the trial Judge erred in assessing past loss of earning capacity up to 1 May 2003, some five weeks after the trial but three months prior to the delivery of judgment. On the basis of the opinions expressed in Richardson and other cases referred to therein, it was within the discretion of the trial Judge to select this date.

94 Cross-appeal ground 2(a) asserts that the trial Judge was in error in assessing the respondent's entitlement to future loss of earning capacity on the same basis as she had assessed past loss of earning capacity by reasons of the matters referred to in pars 1(a) and (c). For the reasons given in respect to those other grounds this ground falls away.

95 Cross-appeal ground 2(b) states that in assessing the respondent's future economic loss on the same basis that she dealt with past loss of earnings, the trial Judge failed to take into account that she had brought into account in the calculation of past loss the sum of $59,500 that the respondent had earned between the date of accident and the date of assessment of the past economic loss, notwithstanding the evidence that the respondent had earned only $566 in 2002 and had an overall loss of $13,630 to 1 May 2003.

96 Given our view that the trial Judge should have assessed damages for past economic loss in a different manner, this ground falls away.

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97 Cross-appeal ground 2(c) challenges the trial Judge's reduction in the respondent's entitlement to an allowance for loss of earning capacity on the basis of her finding that there was a distinct possibility that the fortunes of the company might improve in the next three years notwithstanding (it is said) there was no evidence to support such a finding. As we have noted above, there was evidence to support such a finding. In our assessment of the respondent's damages we have taken this evidence into account, albeit in a different fashion.

98 Cross-appeal ground 2(d) asserts that the trial Judge erred in unduly discounting the respondent's entitlement to future loss of earning capacity. As can be seen from our earlier reasons we are of the view that the trial Judge erred in her assessment of the respondent's economic loss but not in the manner alleged in this ground of cross-appeal.

Conclusion

99 For these reasons we would allow the appeal and dismiss the cross appeal. We would reassess damages for past economic loss in the sum of $18,730 and damages for future economic loss in the sum of $55,728. Otherwise the learned trial Judge's assessment of damages is not disturbed by this appeal and cross-appeal.