Yisrael v Chamberlain John Deer Pty Limited

[1988] HCATrans 121

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No Sl07 of 1987

B e t w e e n -

STANLEY YISRAEL

Applicant

and

CHAMBERLAIN JOHN DEER PTY

LIMITED

Respondent

Application for special
leave to appeal

MASON CJ DAWSON J

TOOHEY J

Yisrael

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 10 JUNE 1988, AT 10.06 AM

Copyright in the High Court of Australia

S1T2/l/PLC 1 10/6/88

MR B.J. GROSS, QC:  May it please the Court, I appear with

MR P. DEAKIN for the applicant. (instructed by

Wallbank & Tilley)

MR A.S. MORRISON:  May it please the Court I appear for the

respondent. (instructed by P.J. McGahen)

MASON CJ:	Mr Gross.
MR GROSS:	Your Honours, if special leave were granted we would

seek to rely upon amended ground of appeal which we

have formulated. Might I hand up to Your Honours copies

of those amended grounds of appeal together with copies

of those decisions	which we would wish to refer to
here.

MASON CJ: Thank you. Mr Gross, this does seem somewhat

unsatisfactory. As I look at paragraph l(a) of the

proposed amended grounds of appeal, that seems to be

a matter that was not given prominence in the

affidavit in support of the application for special

leave?

MR GROSS:	Your Honour, that matter is correct. There has been a change of representation both as to solicitors
and counsel since the time those proceedings were
initiated. We have only just come into the case.

MASON CJ: Maybe, but as far as the Court is concerned, the

Court takes the advantage of reading the papers

beforehand, gives consideration to the way in which the

case presented for special leave is put forward and it

means that there is a good deal of time wasted if, in

fact, the basis of the presentation of the case is

going to be altered.

MR GROSS:  Yes, Your Honour. I apologize for the inconvenience

caused to the Court.

MASON CJ:  Well, you had better explain to us what the new basis

for special leave is in this case.

MR GROSS:	Yes. Your Honours, the amended grounds cover a number of complaints but the special leave matters
essentially are these: in relation to ground l(a),
His Honour the trial judge applied, we would suggest, the principle of LEISBOSCH V EDISON for the purpose of disentitling the plaintiff to receive damages in respect of the lost opportunity to purchase a house
which but for the accident he would have purchased with
that purchase being at a particularly advantageous
interest rate. Second, Your Honours - and this is
covered in ground 2(a) - in calculating interest on
past economic loss, His Honour allowed as a credit in
the defendant's favour the fact that the plaintiff had • .I. • ~ ~ ~,. ''i ~ "' >,- ..... ~. • • • • ' • • ~ I\ :,.-, • • . . r- •
rece:i.vt:u. suc;l.ci..1. ::.e.i.v.1.;.;el:;i :i..u t.:11,;;;;, :i.::u,i:LiL o:t sickness
benefits and invalid pension, this being somewhat of an
unexpected advance on what was said by this Court in
BATCHELOR V BURKE in respect of credits for workers
compenaation payments.

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Yisrael

Your Honours, the third ground touches the matter of hospital and medical expenses which were

not allowed in any way by His Honour. Although

His Honour found that they were recoverable, His Honour did not include a particular element. The complaint

there is that the Court of Appeal, having found that

$70,000 was perfectly appropriate for general damages

and concluding that some allowance should be made,

concluded that His Honour had allowed it in some way

in the general damages figure.	The fourth matter of
complaint - - -

MASON CJ: Well, that is hardly a special leave point.

MR GROSS:  No, Your Honour. Well, Your Honour, it only goes to

this particular narrow matter as to whether or not an

intermediate appellate court ought make assumptions of that order when there has been no express inclusion of

a particular head of damage and where the material

tends to indicate that it has not been taken into account. There are also some complaints about adverse contingencies

but those, Your Honours, are not special leave points as

such.

Now, Your Honours, might I come to ground l(a).

This ground raises squarely for decision the important

point of law of whether the House of Lords decision
in the LEISBOSCH has any residual operation in tort

actions where the plaintiff's loss is attributable to

his impecuniosity following an accident and, if so, how

such operation is to be defined.

. .

Might._I,ver.y briefly. sketch the facts, Your Honours,

because they are in a very brief compass? Prior to his

accident the plaintiff had always lived in rented

accommodation but wished to purchase his own home.

Prior to the accident he had applied for inclusion

in the State government scheme for first home buyers,

this being a subsidized first home buyers scheme

available through the State Bank and Landcom, the

State housing authority. The accident occurred on

30 July 1982. One month later he received a letter

from the State Bank housing agency, which was exhibit M,

confirming acceptance in general terms into the scheme

and enclosing a form requiring that he nominate five

project homes, any one of which he was prepared to

purchase. He did so thereby entering his name in the

ballot. Three weeks later a ballot for each home,

including other homes, was held. He attended and won the ballot for a particular block with a home already

built on it. Its selling price was $56,500 to be

purchased by a loan of $49,000 at particularly low and

fixed interest rates.

_He forfeited the loan by reason of the inability

to take up 1..tie loan and to purchase the particular

property. Its value at date of trial was $72,000. His

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Yisrael

loss was the inability to go through with that

particular purchase of a cheap house at subsidized

interest rates.

Your Honours, the judgment of His Honour

Mr Justice Brownie at first instance is at page 28, line 17 and following. Here His Honour is dealing

with the more general question as to whether or not

adverse effects on the plaintiff's psychiatric health

by reason of his reduced financial circumstances ought

be compensated. His Honour proceeded to say that:

The defendants submitted that a significant

part of the triggering mechanism for his

presently disabling psychiatric state was

his bankruptcy, and this much I accept.

They went on to submit that the defendants are not liable to compensate the plaintiff for the consequences of his bankruptcy, and

they invoke the decision in the LIESBOSCH

DREDGER (1933) ACT 449, and particularly

the dictum of Lord Wright -

and Your Honours are familiar with that particular

dictum. Page 29:

I do not think Lord Wright was there intending

to lay down any absolute rule that the

consequences of bankruptcy are never the

proper subject of a claim for damages. He

was discussing an entirely different topic.

His Honour then proceeded to say, and I will summarize:

that the psychiatric state was aggravated

by the bankruptcy -

was not -

too remote ..... it is the same kind of damage

as that which is admittedly the proper

subject of recovery of damages, but with

one additional triggering mechanism, viz the

accident causing a loss of income, which loss
of income led to the bankruptcy, and the

aggravation of the psychiatric state.

His Honour then proceeds to analyse the fact that the

bankruptcy itself was a foreseeable consequence of the

accident. This is at the bottom of page 29. With:

Each step in the chain of causation was

foreseeable.

And then Hif; Hf"\TH1nr rhen ,..; tPf: th:i ~ r,...,,.,...t:' r.- rlr('; r:1 :i f')n i.n

FOX V WOOD for the proposition that the LIESBOSCH principle does not apply where the accident causes the

particular impecuniosity.

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Your Honours, then at page 33 point 6, at

line 15, His Honour deals with this particular claim

in this way:

There remains a claim by the plaintiff for

damages in respect of the loss of the

opportunity to purchase cheaply the house

in respect of which he won the Landcom

ballot. It seems to me that this loss is

too remote: it is utterly different in

kind to the loss which was foreseeable, and

I reject this claim.

It is unclear there, Your Honours, whether His Honour

is posing two tests rather than one. But, in any event,

in the judgment of Mr Justice Clarke in the Court of

Appeal the matter is only dealt with at page 60 line 8 and following and His Honour says this:

Insofar as it is necessary to do so

I would simply state my view that no error has been shown in Brownie J's decision

insofar as he found that the bankruptcy

flowed from and was caused by the accident.

It may be that in a particular set of

circumstances the question with which he

was concerned may have to be examined by a

court in greater detail or depth, but as

at present advised, I do not detect any

reason for the conclusion that he erred in

this regard.

DAWSON J:  Was the loss of the opportunity to purchase the

house raised in the Court of Appeal?

MR GROSS:  Your Honours, it was raised in the notice of appeal;

it was raised in written submissions.· In oral argument

it was mainly raised in the context of whether or not

the effect on the plaintiff's health of the bankruptcy

was too remote.

DAWSON J: That is a different question.

MR GROSS: Well, that particular question overlapped with the

particular item in relation to the loss of the Landcom

sale. The written submissions were fairly complete

covering a fairly broad spectrum. The oral argument

appears mainly to focus on that particular issue. We have only just got the notes of argument in the Court

of Appeal and we were not there but I would accept,

Your Honours, that in oral argument there is no explicit

reference to the very point but, rather, we would suggest,

it is dealt with in the context of the overall analysis

of the LEISBOSCH case as to whether consequences

fl 9w:in~. :f.r<"'m. h~:mjrr:unt-('v ot impecuniosity should be

attributed back to the accident.

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MASON CJ:  But it is an unsatisfactory vehicle for the grant of

special leave when we find that the specific question

has not been adverted to or discussed and examined in

the judgments of the Court of Appeal.

MR GROSS:  Your Honours, as a subsidiary proposed ground of

appeal we complain of the fact that the Court of Appeal

erred in failing to deal with the matter but,

Your Honours, I accept the force of what Your Honour

puts.

But, in our submission, the matter was, as it

were, swallowed up in the overall question as to whether
the consequences of impecuniosity and bankruptcy were

such as should be attributed back to the accident and

that took, as part of that analysis, the particular loss

concerning the sale. It was a subject-matter of

evidence; it was certainly covered in the grounds of

appeal and the written submissions.

DAWSON J: You are not now seeking to contest a broader issue?

MR GROSS: What, in fact, occurred was, we won on the broader

issue but the victory there did not encompass the

particular matter of which we now complain.

Now, Your Honours, on the question of remoteness

of damage, may I briefly say this, that the defendant

took the plaintiff as he found him, both personally

and economically, and that the egg-shell plaintiff

is a concept which encompasses also the financial

position apart from the plaintiff's health. It was

not necessary that the precise manner of occurrence

of loss or quantum of loss be foreseen and, in our

submission, this is a type of case which is commonly

recurring. It is of the same character as financial

detriments where the relevant loss is the forced sale

of a plaintiff's home or of his vehicle as a result of

reduced earning capacity or where fresh financial

commitments have to be taken up by the plaintiff.

Your Honours, might I turn now to ground 2? in. BURNS V MAN AUTOMOTIVE AUSTRALIA which was decided	I am reminded that this Court did grant special leave
on other grounds. In our submission, the general
question of public importance is one which ought be raised because the continuing scope of the LEISBOSCH
case is a matter of confusion amongst practitioners, - and we would suggest, in some courts.

Your Honours, could I turn to ground 2? That,

in our submission, raises a matter which is of equal
importance. Your Honours, this concerns the credit

given to the defendant in calculating interest for the

sickness benefits and invalid pension received.

His Honour Mr Justice· b1.-·ow1.1i·e ·at ··p1ge' 3-:z-,· ''i:i..ne 1 j, says this:

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The calculation of an appropriate sum to

allow for interest is complicated by the

circumstance that whilst the income tax
returns in evidence show the amounts

received by way of sickness benefits for

the years ending 30 June 1983 and 1984,

I do not know the figures since then.

The parties agreed that the appropriate

average interest rate over the period was

7.5 per cent. I award $3,750 for interest

in respect of this head of damage.

It was agreed by all parties before the Court of Appeal that, on any view, this was an erroneous method of

calculation.

In the Court of Appeal Justice Clarke dealt with the matter at page 61, line 12 and following, and I

will not read all of that portion, Your Honours, but
His Honour took the sickness benefits paid in 1983 to

1984, projected them forwards to date of trial at the

same rate so as to arrive at an overall figure of

$33,000 paid under that heading. And at page 62, line

3, His Honour says:

Whilst that figure is refundable under the appropriate legislation it could not be said

that during the period in question the

appellant has been, to that extent, out of

pocket. The position is analogous with that

which applies in cases in which plaintiffs

receive workers' compensation payments which

they are obliged to repay upon obtaining a

judgment.

His Honour then proceeded to calculate interest on

past economic loss accordingly.

Your Honours, this Court's decision in

BATCHELOR V BUR.KE dealt with the credit to be given for

workers compensation payments and that case demonstrates,

in our submission, that the credit given for workers

compensation payments in calculating interest under that

heading depends upon the close interrelationship
entrenched by specific statutory provisions preventing

double recovery between workers compensation payments

and awards of common law damages. The matter is
perhaps best summarized in FOX V WOOD which Your Honours
have. Your Honours, at page 445 in the judgment of

His Honour Mr Justice Brennan this is said:

Thus, in BATCHELOR V BUR.KE it was held

that the receipt of workers' compensation

was relevant to the inquiry whether in fact :~ 1.~ i '~ !'.; -f'f

,~_ ~ .<>,... ?Pf'f :::'vr.-r1 ~ '1'.'1'",?_(' ti.cal

detriment by the loss of hi~ wages, and it

was held that the defendant should not have

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to bear a liability for interest upon

the lost wages in place of which the

workers' compensation had been received.

And then there is a quotation from BATCHELOR V BURKE

in the judgment of the Chief Justice:

"The legislation has treated the

payment of compensation and of damages in

respect of any one injury as closely

related, and the fact that the lost

earnings have been replaced by

compensation paid under a statutory scheme

whose very purpose is to provide money to

take the place of the lost wages should be
regarded when the Court comes to consider

whether a plaintiff has suffered any

practical detriment by the loss of the

earnings."

Your Honours, in our submission, workers compensation

payments are clearly distinguishable from invalid pensions

or sickness benefits on the following bases: if the

plaintiff has received his full damages entitlement on

the day of accident he may still have been entitled
to social security payments thereafter. So, the delay

in receiving his damages award does not, as such, make

possible those payments of social security. It may well
be, of course, that the funds he gets might disqualify

him on some other ground but in relation to workers

compensation you cannot have both, you can only have

one and the workers compensation is paid under a

separate entitlement but has to be refunded immediately

upon receipt of the damages. In our submission, it is

not the delay in getting his award which rendered

possible the receipt of the social security payments

although that is the situation under the WORKERS

COMPENSATION ACT in respect of payments under that Act.

Further, Your Honours, we would add this, that

REDDING V LEE and ESPAGNE's case in this Court require

that sums are to be disregarded in calculating damages

where they are in the nature of invalid pension or
sickness benefits and, in our submission, it would not

be appropriate to disregard this injunction by bringing

them into account when calculating interest.

Your Honours, the reported cases seem to lack any

reference to this particular question. There is no

authority,.· we IDuld suggest, to justify such a cau:nre. The

assumption~ and we-would suggest probably the practice, has been

to ignore such payments in the past as a credit in

the defendant's favour. We would suggest that it is

v:i.tu.:d. J y un!~.1,nwn for these m.RttP.rP- t.('. hip h,1,,-"",., ;,.,r"

account on settlement negotiations.

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MASON CJ: But, Mr Gross, assuming there is substance in

the point that you are putting, is this a question
that we ought to take up? By and large, it is a matter

that lies at the level of supreme courts and the

Full Courts of the supreme courts. It is substantially

a matter of practice and procedure in the way in

which verdicts are arrived at beyond the actual

fundamental issues in the case. What is the

question of principle that is involved that should

attract our attention?

MR GROSS:  Whether, in the assess:ing of cases at the settlement

level or in the awarding of damages at trial level,
sickness benefits and unemployment benefits or, rather,

invalid pension benefits, should be identified and

then deducted from the amount of the prima facie

economic loss.

MASON CJ: Well, it does not really sound like a question of

general principle, does it?

MR GROSS: Well, in our submission, it applies for every case

therefore it is general in that sense. It is a matter

of principle because although it is in the context of

a payment which is discretionary it is essential

that discretions be exercised judicially by reference

to existing authority. BATCHELOR V BURKE is the

only authority which bears upon the point but only in
the context of workers compensation payments and, in
our submission, a principled approach rather than a

wholly unpredictable discretionary approach is

preferable. The fact that the Court of Appeal in

this particular case took this line does not

create any necessary guide for other courts and, in

our submissions, the lack of authority on the point

is indicative of the fact that practice varies

widely in relation to this matter.

TOOHEY J: Does the matter go to the assessment of damages

generally or is it just related to that particular component of interest that is to be fixed once the

assessment of damages has been otherwise determined?

MR GROSS:  It relates only to the interest portion. I do not

know whether one calls that part of the damages or

an add-on to the damages as assessed.

TOOHEY J: Well, you expressed it earlier as if it were wrapped

·	up in the principles going to the assessment of damages
and I wondered if that was not putting it too widely.
MR GROSS:	I think His Honour Mr Justice Clarke raised this

question and he seemed to take the view that interest

is something which is added on to an award of damages
by virtue of stRtute but: in any event, in our

submission; tht: :n.11a11ci'cU. 1:.esult: is i.:ne same arid the

requirement that the matter be dealt with by legal

principle also operates, in our submission.

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TOOHEY J: And I take it the statute is fairly open-ended,

is it, as to how the interest is to be calculated?

MR GROSS:  It is in New South Wales. I am not fully familiar

with the other States. But I do not know of any

greater detail that is entered into by other State

legislation, it is just a general entitlement which

is expressed in a relatively standard form subject

to minor variations which do not operate here.

Your Honours, the unpredictability of result

if, in fact, this matter is unclear, is one which may

tend, in our submission, to create disagreements

at negotiation level therefore impeding the work of

the courts in resolving matters or aiding the
resolution of matters by settlement before coming to

trial. In our submission, this is an area where

there ought to be certainty and predictability so that

courts are not troubled by this particul_ar area having

to be litigated and relitigated at the

discretionary - - -

TOOHEY J:  It is not really uncertain or unpredictable,

Mr Gross, is it, if the Court of Appeal is right in the approach that you look at the extent to which

the plaintiff is out of pocket and in deciding

whether he is out of pocket in this situation you

say, "Well, truly, he had lost his earnings for a
particular period but to some extent he received
sickness benefits by way of compensation, so it is
the net figure that one looks to in deciding to what

extent he is out of pocket for the purpose of

assessing how much interest should be paid'.'.

MR GROSS:	Yes, Your Honour. The difficulty then becomes what matters should be taken into account in
determining whether a plaintiff overall is out of
pocket and there are other variants of this, sick leave payments, superannuation payments, loans by
relatives and the like.
TOOHEY J: Well, that may well be but the Court of Appeal has

said, in this case at any rate, that the sickness

benefits are to be taken into account. So, there is nothing uncertain or unpredictable. It may be right or it may be wrong but it is not uncertain.

MR GROSS: 

Yes. Well, Your Honour, in our submission, the

uncertainty would remain for the other States which
are not bound by this decision.

MASON CJ: 

Now, Mr Gross, I took it, perhaps mistakenly from what you said earlier, that there are not decisions

i!1_ ~~?er States dea~~~~ with this ques:~~n?

MR GROSS:  Yes, that is so, Your Honour. We have been unable

to locate any.

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MASON CJ:  Do you know what the practice is in the other

States?

MR GROSS:  Your Honour, no, we do not.

MASON CJ: After all, according to you, this question arises

in a forest of cases and one would have thought that

clearly established practices would have developed in

all States.

MR GROSS: 

Your Honour, we suspect that no practice has developed as such because if there is an adverse result it is

either dealt with as being discretionary therefore not

worth appeal or, alternatively, the amount involved in

an individual case does not warrant an appeal where
otherwise the result was satisfactory. The practice

in New South Wales I can certainly say something
about and, in our submission, one would expect it to be

parallel by the practice in other States. It is

plainly an item which is not great in amount in

proportion to the overall amount of verdict in any given case. It does not receive a great amount of

attention. It is rare, in fact, that in every case

even the BATCHELOR V BURKE deduction is thought of by

those who represent defendants. It would be wholly unexpected for them to raise matters concerned with sickness benefits or any other form of social security

payment.

MASON CJ: 

It is a bit strange that in this world of uncertainty

the matter has not been taken to an appellate court
before it was taken to the Court of Appeal in this
case, if it is a world of uncertainty.

MR GROSS: 

Because the amount involved in any individual case

does not warrant the cost in app.ealing the matter.

MASON CJ:  But one would have thought that it would arise of

necessity, incidentally, in other cases where damages

appeals are taken.

MR GROSS: In that event, Your Honour, I would suggest that

there are generally greater matters of concern and

because of the lesser amount involved the consideration

is dwarfed by the other grounds.

MASON CJ:  So that it is not even worth raising the point for

argument?

MR GROSS:  It is not in an individual case, in our submission,

an important matter but if one multiplies the particular error, if there be an error either way, by the number of

cases,whether litigated or settle~ it becomes a matter

of some dimensions.

MASON CJ: Yes. Well, t;he case based on its importance seems

to be gradually ebbing away if it is not worth being raised in cases before the Court of Appeal involving

damages generally.

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MR GROSS: Well, Your Honour, the fact that it is not explicitly

raised or complained of does not eliminate the fact that

it is a source of error and a source of either

under-compensation or over-compensation. I think that

completes my submissions on that point, Your Honours,

and Your Honours have the grounds of appeal in relation

to the other aspects.

MASON CJ: Yes.

MR GROSS:  There is just one other matter which I might raise.

In relation to the contingencies point, which is ground 4,

our complaint is that the Court of Appeal has lapsed

into an error which is, in our submission, forbidden by

decisions of this Court of treating, as a starting point,

some conventional figure which requires to be deducted off

in the standard case, whereas the correct connnencing

point should be to calculate the loss and then determine

in the individual case where the balance lies between

adverse vicissitudes and positive vicissitudes. It is

also notable, Your Honours, that although Justice Brownie

spoke in terms of a conventional deduction being

appropriate, the relevant deduction was in the order of

27 per cent.

Your Honours, we rely on any appeal on the

detailed grounds that Your Honours already have.

MASON CJ: Yes, thank you, Mr Gross. Yes, Mr Morrison, what do

you have to say, particularly about grounds l(a) and (b)

T2 and ground 2?

MR MORRISON: Yes, thank you, Your Honours. In relation to

grounds l(a) and (b), those were, in the Court of

Appeal below, advanced in the notice of grounds of

appeal and were referred to in the written submissions.

I have, however, no recollection of ground l(a) being

dealt with in oral submissions at all.

The question then arises as to whether this is a

suitable vehicle for the exploration of the LEISBOSCH

DREDGER decision. And the Court of Appeal, in fact,

connnented upon that question at page 60, at line 8.

MASON CJ: That was just one sentence though, was it not?

MR MORRISON:  Yes, but their reasoning can be explored a little

further than that. It has to be borne in mind that

His Honour, at first instance, had found in favour of

the plaintiff on the question of law; the Court of

Appeal upheld that finding so that the question of law was determined and no issue appeared then to arise from

it. Ti:1e only question that appeared then was the

application of that principle of law to the facts and

:tt TflPr- f'.'r>~ ~,, :H~f!P~t-: of thr-- far.ts whjcb :i~ t:he.

only matter which remains now outstanding in relation

to which leave to appeal is sought in this regard.

The question of principle was not a matter which took

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up much time of the Court of Appeal because the Court

of Appeal took the same view as the trial judge, namely,
that LEISBOSCH DREDGER was not initially the approach

to take.

So that when, at page 60 in the judgment of

His Honour Mr Justice Clarke - what he said there was:

no error has been shown in Brownie J's

decision insofar as he found that the

bankruptcy flowed from and was caused by

the accident. It may be that in a

particular set of circumstances the

question with which he was concerned may

have to be examined by a court in greater

detail or depth, but as at present
advised, I do not detect any reason for
the conclusion that he erred in this

regard.

MASON CJ:  Now, from your side, was any submission put to the

Court of Appeal on the LEISBOSCH DREDGER issue in

relation to the claim for damages concerning the

loss of opportunity of purchasing the home?

MR MORRISON:  Yes, Your Honour.

MASON CJ: Well, what was the submission that was put from

your side?

MR MORRISON:  The submission was primarily put to the application

more generally of the LEISBOSCH DREDGER case. It was

primarily directed - - -

MASON CJ:  But it was an answer to all damage that flowed

from the bankruptcy and impecuniosity.

MR MORRISON: That was so, Your Honour. And that submission

was advanced by way of notice of contention.

Their Honours found that the notice of contention had no place because, in essence, they accepted the

judgment in the court below. The only matters in

which they held that the court had erred were in relation

to matters of contributory negligence and interest

which were matters not of substance in the calculation

of damages at large and accordingly the Court of Appeal

held that the notice of contention should be put to

one side. So that matter then was not ultimately of

relevance in the final decision. Having held that

the appeal failed in so far as the general attempt to

increase damages was concerned, with those two

exceptions, the notice of contention just did not come into play.

MASON CJ: Now,. in relc1.tion to the damages claimed so far

as it related to the loss of opportunity to obtain

the home, did you advance any submission other than

the LEISBOSCH DREDGER submission?

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MR MORRISON:  The only other submission that was advanced was

the submission that the loss was so uncertain and so

little related that it was an inappropriate case for

the application of the decision in principle of

His Honour at first instance. Can I refer Your Honours

in that regard to the judgment of the Court of Appeal

at page 52 at line 9.	Mr Justice Clarke there said
this:

Furthermore, in the period immediately preceding his accident he had accumulated

significant debts, which, with the addition
of only one further debt, led to his bankruptcy

in January 1983 at the suit of the Deputy

Commissioner of Taxation.

There was a possibility that even apart

from the accident his estate may have been

sequestrated and this would not have been an

inconsequential matter. I appreciate that

his Honour found that the ultimate bankruptcy

was causally related to the injuries
sustained in the accident but to say this is
not to deny the validity of the statement that

there remained the possibility that quite

apart from the accident he may have become

bankrupt anyway.

So, we have then a situation where - so far as the

bankruptcy was concerned, that was a ~atter of

probability on the findings of His Honour. But the

question then as to whether he would have been in any

position regardless to go ahead with the purchase and
building of a house is taking the matter one step further
along the line and what becomes probable starts to
become a great deal less probable as we advance the

process further, particularly given, as His Honour

Mr Justice Clarke said in the Court of Appeal, that

only one further debt was incurred in relation to the

bankruptcy notice prior to his actual bankruptcy, that

is, that almost all the debts were incurred prior to

this accident.

So that if one looks at this case on the question

as to whether it was an appropriate vehicle for

determining the application generally of the

LEISBOSCH DREDGER decision or the dicta in FOX V WOOD,

we have the difficulty that here the matter complained

of is a matter which is merely a matter of slight

possibility and it creates a very real difficulty if

one is to try and determine in this case any issue of

general principle in relation to the foreseeability

and causal connection with the failure to build a house.

So that my respectful submission is that even if there

were any error demonstrable in this case, what is at

issue here is no more than a mere possibility and is a

case which, as the Court of Appeal indicated, is an

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inappropriate one for the determination of more

general principles. That was the approach taken below

and, in my respectful submission, an appropriate
approach given the actual facts of this case. And the

strength of that submission is, I submit, added to by

the fact that the submissions in the Court of Appeal

were not specifically directed to this particular

issues. That indicates its lack of importance in

the overall scheme of things because, in fact,

the Court of Appeal had taken the view that the

LEISBOSCH DREDGER principle was inapplicable in

general to the circumstances of this case so that no issue of legal principle, in substance, arises for determination by the High Court in these

circumstances.

TOOHEY J:	Mr Morrison, in what way did the primary judge take the bankruptcy into account? Is it compensable by way
of the emotional implications for the plaintiff?
MR MORRISON:	Yes.

TOOHEY J: And to that extent only?

MR MORRISON:	Well, the matter was inextricably mixed with other aspects of economic loss because His Honour at first
instance found that the bankruptcy had a devastating
effect upon the plaintiff from a psychiatric point of
view and the psychiatric evidence from both parties
reflected that and, accordingly, because his
orthopaedic condition was not such as to preclude him working, it was the psychiatric condition in part
flowing from the bankruptcy which, in turn, reflected
in economic loss, both at the date of trial and
continuing, so that it reflected on all heads of damages to that extent.
Your Honours, in regard to interest: interest is a matter of discretion under the SUPREME COURT ACT
in New South Wales. That discretion, of course, has
to be exercised judicially but, in my respectful
discretion is primarily one for the supreme court in submission, the application of that Act and that
the absence of some general error of principle and,
in my respectful submission, no such error of principle
has been advanced here. What, in fact, occurred was
the application of the general principle at common law
that a person should only be compensated to the extent
that he is in fact out of pocket and that is not a matter which, in my submission, falls to the attention of the
High Court.
Unless there are some further matters, those are the submissions I wish to advance.

MASON CJ: Yes, thank you, Mr Morrison. Yes, Mr Gross.

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MR GROSS: Just two matters in reply, Your Honours.

BATCHELOR V BURKE, in our submission, makes clear that

it is not merely a matter of discretion which is

open-ended but a matter of construing the particular

statutes involved. So, it is a matter of law rather

than being something that is open-eneded in the powers
that the court has.

The second matter concerns the subject-matter of scrutiny by the Court of Appeal on the remoteness

issue. In our submission, it is plain that

submissions were put which covered both the personal

effects and the financial effects on the plaintiff of

his impecuniosity and the record of argument in the

Court of Appeal does record my learned friend saying

that:

We submit His Honour erred in regard to the

issue of foreseeability. The LEISBOSCH

DREDGER remains law in the this country at

this stage and in so far as this appellant's

problems are attributable to his impecuniosity

then that is not to be visited upon the

respondents whether by way of general damages -

and we emphasize -

or by way of economic loss.

In our submission, it is true that the matter was addressed under the overall general question of recoverability but it is nevertheless a part of the appellant's case in the Court of Appeal.

MASON CJ: Thank you, Mr Gross.

Of the points sought to be argued by the

applicant in the proposed appeal, only one, that

stated in proposed ground of appeal l(a), could

possibly be said to raise a question of general

principle. Having regard to the view of the facts

taken by the primary judge and the Court of Appeal,
the way in which the question was dealt with in the

Court of Appeal, this case is not a suitable vehicle

for the determination of that question. The

application for special leave is therefore refused.

MR GROSS: May it please the Court.

MASON CJ:	Mr Morrison, I take it you ask for costs?
MR MORRISON:	Yes, Your Honour.

MASON CJ: You do not resist, Mr Gross?

MR GROSS:  No, Your Honour.

MASON CJ: The application is refused with costs.

AT 10.51 AM THE MATTER WAS ADJOURNED SINE DIE

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