Whitaker v Trodler No. Scciv-01-1380

WHITAKER v TRODLER
[2002] SASC 122
Full Court: Prior, Nyland and Gray JJ

PRIOR J: I agree that the trial judge erred with respect to his assessment of past economic loss. In particular, the trial judge erred in a proper interpretation of the evidence of Mr McCulloch and Mr Reilly. Properly understood, the effect of their evidence was that the respondent had a very bad back, both before and after the accident, with a real possibility that at some time in the future it would re-rupture. That contingency was not to be confined to the assessment of future economic loss.
The evidence from all of the medical experts was to concede a real possibility that without the accident the respondent may have been precluded from continuing his job because of a recurrence of his back problem, brought upon by everyday activity. The chance of this occurring was significant. Nevertheless, the evidence discloses that from the date of the accident to trial the only recurring back problem was related to the accident and not the condition before then. In my view, the award for past economic loss should be reduced by $40000.
I would not interfere with the amount awarded for future economic loss. Given the “very significant chance of the (respondent) being precluded from continuing his job because of a recurrence of his back problem, brought upon by everyday activity”, I think the amount awarded was excessive apart from the apparent failure to take into account an amount with respect to the loss of superannuation benefits. When that amount is taken into account, with an appropriate allowance for contingencies it seems inappropriate to vary the sum awarded for future economic loss.
On this approach I would allow the appeal for the purpose of reducing the award of damages by $40000.
NYLAND and GRAY JJ: This is an appeal from a decision of a District Court judge. The appellant was the defendant in the proceedings and the respondent the plaintiff. The respondent sought damages for personal injuries suffered in a motor vehicle collision which occurred on 25 January 1993. Liability was not disputed. The respondent’s damages inclusive of interest were assessed in the sum of $664,314.09.
It was common ground at trial that as a result of the collision the respondent suffered a recurrent disc protrusion which required surgery. The learned trial judge identified the main issue of contention between the parties as being whether and to what extent the damages awarded should be affected by a pre-existing back condition.
At the date of trial the respondent was aged 45 years. He began work at General Motors Holden on the production line as a spot welder in March 1979. He was later promoted to leading hand seam welder, a position which he held for about seven years. During that period he undertook a supervisor’s training course. He was promoted to the position of Grade 6 supervisor in November 1987.
From about 1990 the respondent was heavily involved in long distance running. He competed in marathons in 1991 and 1992 and also played indoor soccer. On 9 September 1992, he jumped into his car and sat on his wallet which was in his back pocket. It dug into his buttock causing soreness in his back and right leg. The symptoms persisted for some little time and then got worse. He eventually went to see a neurosurgeon, Mr Khera who operated on his back on 9 October 1992. He returned to work about two or three weeks after the operation. He had a brief period on light duties but then returned to his job as a supervisor.
The judge found that until the time of the back procedure in October 1992, the respondent had enjoyed excellent health. He accepted the respondent’s evidence that following his return to work after the operation he had no difficulty in performing his duties and resumed leading a normal life. He had been informed by Mr Khera that he had made a complete recovery.
On 25 January 1993, on his way home from work, the respondent’s car was struck by a car driven by the appellant. The respondent described the collision as “an average bang”. The appellant referred to it as “a slight collision”. There was some minor dispute between the two parties as to the circumstances of the collision. The judge did not consider that of any relevance to his assessment. He found that on either version the impact was a moderate one.
Immediately after the collision the respondent felt tingling in his legs and soreness in his back. He saw Dr Wilson at Holdens Medical Centre who referred him back to Mr Khera. Mr Khera performed another operation on the respondent’s back on 5 February 1993. The respondent was discharged from hospital on 11 February 1993. After the operation he suffered from sharp pain in the centre of his buttock, soreness in his lower back and numbness in his right foot. After he returned home he did not progress as well as expected in comparison to the progress he had made after the operation in October 1992.
In May 1993, he endeavoured to return to work on light duties in the body shop at Holdens. He could only undertake sedentary work for three to four weeks because he was suffering spasm in his back and he would lose feeling in his right leg which would cause him to fall over. On 19 May 1993 he returned to hospital for bed rest and further scans. In mid-1993, the respondent went on a rehabilitation program at Holdens and also undertook a pain management program at Memorial Hospital. From November 1993 onwards the respondent was trying to work on modified duties and would work for as long as he could manage.
In 1994 he continued to have problems with the pain in his back. He consulted Mr North, a neurosurgeon who advised him that he could not do anything further for him. The respondent was unsuccessful in obtaining a position as a Grade 6 supervisor in a different plant on account of his injury. In about August 1994, however, he obtained a supervisory position in the vehicle assembly plant. Thereafter until March 1996 he worked in various areas as a supervisor. This position involved him walking up and down stairs and as a result only lasted for three or four weeks. Thereafter he was offered a clerical job on the day shift where he worked for about 12 months. He worked varying hours a day but found the position difficult because he was sitting down all of the time.
In late 1996 he consulted a general practitioner, Dr Ghan, and Mr Fry, an orthopaedic surgeon. Mr Fry performed a postero-lateral fusion in November 1997 after a failed attempted anterior-lumbar sacral fusion on 28 October 1997.
The respondent was thereafter off work for a substantial period of time. Eventually on 14 December 1998, Holdens found him a position which would allow for his problems. He then returned to work on a modified basis and over 12 months worked his way up to full-time as the supervisor of a painting crew of workers who were also on rehabilitation. The trial judge said, however, that at the date of trial, the respondent’s job was “virtually clerical” and he was not able to go back to his former position as a Grade 6 supervisor.
The respondent gave evidence that if he had not suffered the injury to his back he would like to have continued at Holdens and become a Grade 7 supervisor. He would have continued working until the age of 65. In addition to problems with his work, the respondent also described difficulties at home such as dressing, playing with his son, lifting and carrying out manual work and trouble staying in a seated position.
As a part of his case at trial, the appellant produced a number of films which showed the respondent performing a variety of activities. In his reasons the judge referred to the films and said:
“Although they are very brief, they do show a freedom of movement which is not entirely consistent with the plaintiff’s evidence as to his present condition. Also a number of the medical practitioners who took histories from the plaintiff agree that those films are not entirely consistent with the histories which he gave them. However that is the only limited use I can make of those films. They certainly do not influence me in relation to the question of his future economic loss because it is clear that his inability to hold down the previous job that he had as a Grade 6 supervisor is due to the fact that over a period of time during the day his back becomes progressively worse due to longevity as distinct from an inability to bend or lift. It is also not relevant to the question, which is the main issue in this case, whether and what discount should be given to the condition of the plaintiff’s back at the time of the accident.”
At the trial, the respondent called six medical practitioners to give evidence on his behalf. Doctors Wilson and Ghan are general practitioners. Mr Khera is the neurosurgeon who performed the operations on the respondent’s back on 9 October 1992 and 5 February 1993 respectively. Mr Fry is the orthopaedic surgeon who performed the attempted lumbo sacral fusion on 28 October 1997 and the postero-lateral fusion in November 1997. Mr Guirguis is an orthopaedic surgeon who examined the respondent in 1996 and 1998 and on 12 February 2001. Mr Wickham is a general surgeon who examined the respondent on 3 December 1993, 1 August 1994 and again in August 1996. The appellant called three medical witnesses, Mr McCulloch and Mr Reilly, both of whom are neurosurgeons, and Dr Hamilton a general practitioner.
The evidence given by the medical witnesses was extensive and involved a number of complex issues. The judge carefully considered all of that evidence and then expressed his conclusions in the following way:
“Having carefully observed all the evidence and the medical opinions presented in evidence I find that at the time of the accident the plaintiff clearly had a weakened, degenerating disc. That is clear from the evidence of Messrs McCulloch, Reilly and Khera. The evidence does not and indeed cannot establish that a precise time can be put as to whether the disc would have reruptured if the accident had not happened. The fact was that it did rerupture because of the accident and for no other reason. I do not accept that it would necessarily rerupture within 3 to 12 months as suggested by Mr McCulloch and six months as suggested by Mr Reilly. I therefore will not assess damages on the basis that there is limited scope to make an award for anything that has happened 12 or more months after the accident. However having said that I accept the evidence of Mr Reilly and Mr McCulloch that the plaintiff had a very bad back and there was a real possibility that sometime in the future it would have reruptured before his retiring age. That is also consistent with the evidence of Mr Khera. I will assess damages on the basis that there has to be a substantial discount for any damages I find to exist to allow for that contingency. I also find on the evidence before me that that contingency applies to any future damages and does not apply to special damages or past economic lost. I now turn to the various heads of damage.”
The learned trial judge then went on to assess the award for past economic loss in the sum of $276,196. He did not allow any discount for the possibility that during that finite period of time the disc might have re-ruptured even if the accident had not occurred.
In assessing damages for future loss of earning capacity, the judge found that consistent with the medical evidence the respondent was unable to perform the supervisory work which he did before the accident. He found that in the near future, because of his back problems, the respondent would not be able to retain his employment at Holdens and that he had lost the opportunity to further his career at the level of Grade 7 supervisor. He accepted the respondent’s evidence that he intended to work until he was about 65. In assessing damage for future loss of earning capacity, the judge took as a starting point the wage of a Grade 7 supervisor, of $58,540. He then added the amount of $23,700 overtime and 9% average loading for working afternoons. These figures resulted in an agreed amount of $1,065 per week nett which the respondent would have earned as a Grade 7 supervisor. The judge also took into account the potential loss of $35,000 with respect to a car lease for a Grade 7 supervisor. He referred to the actuarial multiplier of $542 to age 60 years and to age 65 years of $643 both using a 5% discount rate. He then adjusted all of those figures and set “a raw figure of $600,000” as the starting point for the assessment of future economic loss before turning his mind to any discount for contingencies.
The judge considered that there should be a substantial discount for contingencies. He expressed the view consistent with his findings that there was a very significant chance that, even without the accident, the respondent may have been precluded from continuing his job because of the recurrence of his back problem, brought upon by everyday activity. Despite his finding of the likely loss of the job at Holdens very soon the judge allowed for the possibility of the respondent being able to obtain other employment. The judge also bore in mind that the respondent was still employed at the date of the trial. He finally resolved to discount the figure of $600,000 by 50% to allow for contingencies. This resulted in an award for future loss of earning capacity of $300,000.
On appeal the appellant challenged the amounts awarded for both past economic loss and future loss of earning capacity and complained of the adequacy of the judge’s reasons on a number of topics. The appellant was critical of the way in which the judge dealt with the medical evidence and suggested that the judge’s rejection of part of that evidence was the result of being led into error by his finding that the forces involved in the collision were moderate. The appellant complained that the judge failed to give sufficient weight to the activities being undertaken by the respondent from the time of his first operation. These activities may have increased the likelihood of some incident which could have caused further rupture. The appellant also complained of the finding made by the judge as to the limited use to be made of the videos which showed the respondent engaged in a number of activities.
The appellant did not challenge the finding made by the judge that the respondent had lost the opportunity to become a Grade 7 supervisor, but argued that the state of the appellant’s back prior to the motor vehicle collision was such that it could not be said as a certainty that he would have been promoted to Grade 7.
Taking all of those matters into account, the appellant submitted that there should have been some reduction in the amount to be awarded by way of past economic loss to allow for the possibility of a re-rupture prior to trial. As far as the future was concerned, the appellant submitted that the deduction of 50% for adverse contingencies was manifestly inadequate.
The respondent argued, however, that on the evidence the judge was entitled to find that there should be no discount with respect to past economic loss. Apart from the effect of the accident on a back that had not fully healed, there were no other incapacitating life events or recurrences of rupture during the relevant pre-trial period. This was a period of about eight and a half years. The judge had expressly rejected the evidence of Mr Reilly and Mr McCulloch that the respondent’s back would have necessarily re-ruptured within a period of about three to 12 months. Mr Reilly had conceded that the respondent’s return to work following the first operation showed a fairly impressive degree of recovery. On a consideration of the medical evidence it was therefore open to the trial judge to find that the respondent would not have suffered disabling back problems such as to stop him from working during the period prior to trial.
In any event, the respondent submitted that when the award was looked at in its entirety it could not be said to be manifestly excessive. In this regard the respondent referred to the figures relied on by the judge to calculate the damage for future loss of earning capacity. On a strict mathematical calculation of the agreed figures for loss of earnings including overtime and the car lease package, the present day value of the projected future loss of earnings before any adjustment was $719,795. In addition, there was a further sum to be included for the agreed value of potential loss of future superannuation benefits which as at the date of trial had an agreed value of $53,000. The judge failed to include the loss of superannuation benefits in his calculations. If that amount was added to the capitalised sum of $719,795, the starting point before allowing for contingencies was $772,795.
On that basis, the respondent submitted that the judge had taken an extremely conservative approach by using a raw figure of $600,000 as his starting point. To then reduce that sum by 50% to reach a figure of $300,000 for future loss of earning capacity, allowed an appropriate reduction for contingencies which was consistent with the whole of the evidence and could not be characterised as manifestly excessive.
In order to resolve this appeal, it is unnecessary to deal with the majority of the appellant’s complaints. We should, however, indicate that we are not persuaded that the judge was led into error by his description of the collision as moderate. We consider that all the judge was doing was expressing a view consistent with the evidence that the collision was not, in the scheme of things, particularly serious. Nor do we think that the judge treated the evidence of the films in an inappropriate way. There was no real dispute that the respondent had a bad back. The issue as identified by the judge was the extent to which his pre-existing condition affected the award for damages arising out of the accident.
In our opinion, however, the judge did fall into error in the manner in which he approached the assessment of damages for both past economic loss and future loss of earning capacity. There is no challenge to the judge’s finding that in the collision the respondent sustained a severe back injury which led to an exacerbation of a pre-existing degenerative spinal condition. As the evidence established that there was a real possibility that sometime in the future the disc would re-rupture before the respondent reached retiring age, it was clear that the respondent had suffered a significant and permanent loss of earning capacity. The judge found that in the near future the respondent would lose his job at Holdens. If that occurred, the respondent would have difficulty in finding other employment, but the judge recognised in his assessment of damages that it was appropriate to make allowance for the contingency that the respondent’s working life might in any event have been interrupted or shortened because of his pre-existing condition.
As earlier observed the judge commenced his assessment of the respondent’s loss of earning capacity as a total and permanent loss at a value of approximately $720,000 based on the wage payable to a Grade 7 supervisor. The judge then reduced that figure to “a raw figure” of $600,000 as his starting point for the assessment of future loss of earning capacity. He did not, however, give any explanation as to the reason for that reduction. Presumably the judge had regard to the possibility that the respondent would not have achieved the status of a Grade 7 supervisor, or that he might have in any event continued in his present employment or have found other work.
The judge went on to say that “a substantial amount had to be discounted to allow for the many contingencies in this matter”. He had regard to the “very significant chance that from now onwards, even without the accident, the plaintiff may have been precluded from continuing his job because of a recurrence of his back problem brought upon by every day activity”.

The judge then had regard to what he described as the “normal contingencies such as being able to obtain other employment” and reduced the figure of $600,000 by 50% to reach a sum of $300,000 to allow for those contingencies and assessed future loss of earning capacity in that amount. He did not, however, make any corresponding allowance for contingencies in his assessment of past economic loss. There was, however, a body of evidence which supports the appellant’s contention that there should have been some reduction in that award to allow for the possibility that even if the accident had not occurred, the disc could have re-ruptured in the period prior to trial.
Although the judge rejected the evidence of Mr McCulloch and Mr Reilly as to a timeframe of between three to 12 months for that to have occurred, there was other evidence, called by the respondent, which supported the evidence called by the appellant that there was a very real possibility of a re-rupture due to some other intervening event in the pre-trial period. For example, Mr Khera’s evidence on this topic was as follows:
“Q.Let’s assume the car accident hadn’t occurred and in January of that year Mr Trodler continued to play indoor soccer; in other words, within three months a little bit of body contact in an inside soccer game could well be enough to have triggered his back problems again.
A.Yes, any other similar incident could have triggered a recurring problem.
HIS HONOUR
Q.The car accident has caused the result which you’ve seen after the accident, right; this is what’s been led anyway.
A.Yes.
Q.Any other activity which was unwise during that period of time could have had the same effect.
A.That’s right. Any other activity that may cause sudden – similar sort of accident type of injury to the back, a stumble or sudden lifting or something.
Q.Could have had the same result, bearing in mind the vulnerable state he was in; is that what you’re saying.
A.Yes.
Q.What sort of things are we talking about; jogging, playing soccer.
A.Excessive jogging, playing soccer, that is a stumble or a fall or jumping on steps or other rigorous social activities.
XXN
Q.A quick twisting movement, for example, catching a ball if you had to twist your back quickly.
A.Yes, something – if you have to jump and fall, or something like that.”
Similarly, Mr Fry said:
“Q.There is no doubt, with the contemporaneity of symptoms, the car accident caused whatever happened.
A.So he said.
Q.There doesn’t seem to be an argument about that, but the question is whether that night, if he had gone to indoor soccer, it might have happened anyway.
A.Yes.
Q.Or if he went to pick up the sprinkler.
A.And the finger of God may have come down, but none of that happened.
Q.It may have fitted into the 50% (sic) or 10% of people who have recurrent disc protrusions anyway.
HIS HONOUR
Q.I think what Mr Lovell is putting is this: because of that first operation, because of the weaknesses of fatty scar tissue over it, many seemingly every-day activities could have caused this.
A.Yes.”
Mr Reilly and Mr McCulloch also expressed the opinion consistent with the evidence of Mr Fry in the passage cited above that that there was a 5 - 10% chance of a re-rupture in relation to the type of surgical procedure undergone by the respondent.
In Malec v J C Hutton Pty Ltd[1], the High Court set out the correct approach to assessing damages when questions arise as to the future or hypothetical effect of a physical injury or degeneration. The court said (per Deane, Gaudron and McHugh JJ) (at 642):
“When liability has been established and a common law court has to assess damages, its approach to events that allegedly would have occurred, but cannot now occur, or that allegedly might occur, is different from its approach to events which allegedly have occurred.
And at 643:
“Thus, the court assesses the degree of probability that an event would have occurred, or might occur, and adjusts its award of damages to reflect the degree of probability. The adjustment may increase or decrease the amount of damages otherwise to be awarded. See Mallett v McMonagle [1970] AC 166 at 174; Davies v Taylor [1974] AC 207 at 212 and 219; McIntosh v Williams [1979] 2 NSWLR 543 at 550-551. The approach is the same whether it is alleged that the event would have occurred before or might occur after the assessment of damages takes place.”
[1] (1990) 169 CLR 638
In this case, the judge correctly found that the evidence did not and could not establish a precise time at which the disc would have re-ruptured if the accident had not happened. However, in view of his finding that the respondent had a very bad back and that there was a real possibility that sometime in the future there would be a re-rupture, the judge was required to make an appropriate adjustment to the award of past economic loss to allow for that contingency.
In the light of all the findings made by the trial judge, it was appropriate for there to be a substantial reduction for contingencies with respect to both past economic loss and the future loss of earning capacity. When looking at the judge’s approach to the award of future loss of earning capacity however, it is unclear as to why he made two reductions for contingencies, that is, by first reducing the future earnings figure by approximately $120,000 and then reducing the already discounted figure by a further 50%. In our view, the overall reduction in the order of 60% was too great a reduction. Additionally some reduction was appropriate in regard to past economic loss, however, regard must be had to the medical evidence suggesting that it was likely that the respondent would encounter more problems as he aged.
In considering these issues there is a further matter to be borne in mind. It was accepted by counsel for the appellant that the judge had failed to make an allowance in favour of the respondent for loss of superannuation benefits. It was agreed that the value of those benefits, as at the date of trial, amounted to approximately $53,000 prior to any reduction for contingencies. We consider that some allowance for the loss of superannuation should have been have been included in the calculation of the award for future loss.
In summary, it can be seen that the judge fell into error by failing to allow for contingencies in his assessment of past economic loss and also in the way in which he dealt with contingencies in the award for future loss of earning capacity. Further, he erred in failing to make an allowance for the loss of superannuation benefits. As error has been demonstrated, it is necessary for this court to reconsider these components of the assessment.
We consider that an across the board reduction for contingencies of the order of 40% with respect to both past economic loss and future loss of earning capacity would be appropriate. That approach would produce a total award of a sum slightly greater than that allowed by the trial judge. The respondent by notice of alternative contention did not, however, seek an increase in the award but simply suggested that there were compensating errors that should lead to the appeal being dismissed.
Discounting for contingencies in a case such as this requires the exercise of a broad discretion which is incapable of any precise mathematical calculation. In our opinion, when looked at as a whole, the award cannot be characterised as manifestly excessive. We do not consider that it is appropriate to interfere. In our opinion, the appeal should be dismissed.

[2002] SASC 122

16 April 2002