McLEOD v PACIFIC WASTE MANAGEMENT (NSW) PTY LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL SAMUELS, CLARKE and HANDLEY JJA 12 and 13 August 1991, 13 August 1991 [1991] NSWCA 299 DAMAGES — Jury verdict — Appeal on ground that damages inadequate — Jury acting reasonably bound to accept plaintiff's uncontradicted and unchallenged case on damages — Test whether the damages are out of all proportion to the circumstances of the case. Held: The appellant had demonstrated that the verdict of the jury could not be allowed to stand and the Court of Appeal was entitled to reassess damages rather than order a new trial. Australian Iron and Steel v Greenwood (1962) 107 CLR 308 Precision Plastics v Demir (1975) 132 CLR 362 Handley JA This is an appeal by a plaintiff from the verdict of a jury. The plaintiff sued his employer for damages for negligence arising from injuries he sustained in the course of his employment on 10 October 1983. The action was tried before Whitlam AJ and a jury of four who returned a verdict for the plaintiff for $143,261.95. Judgment was entered for this amount after deduction of an agreed figure representing the Workers' Compensation payments. The notice of appeal contained three grounds, two of which related to an alleged misdirection and non direction by the trial judge. The third was that the damages awarded by the jury were inadequate. At the hearing however the only ground of appeal that was pressed by Mr. Toomey, of Queens Counsel for the appellant, was that relating to the inadequacy of the damages. The principles which guide an appellate court in reviewing the verdict of a jury on the ground that the damages were either excessive or inadequate are well settled. They were summarised by Gibbs J in Precision Plastics v Demir (1975) 132 CLR 362 at 369 in a passage that has frequently been referred to. The test, for present purposes, is whether the damages are so small as to be unreasonable, so inadequate that no jury could reasonably have awarded them or, as is sometimes said, out of all proportion to the circumstances of the case. The Court approaches the verdict in such a case on the presumption that the jury has taken the most adverse view of the facts and evidence that was reasonably open to them. (See Australian Iron and Steel vy Greenwood (1962) 107 CLR 308 at 326). The parties agree that the jury must be taken to have included in their verdict the sum of $15,310.91 for agreed out of pocket expenses and $40,671.04 for wage loss from the date of injury to 7 August 1987. These total $55,891.95, leaving $87,380 for general damages and for economic loss from 7 August 1987 to trial and thereafter. Because of the need to award interest on general damages to the extent that they related to the past, the jury were asked to and did indicate that the sum awarded on this basis was $15,000, covering a period of nearly six years from the injury. 2 UNREPORTED JUDGMENTS In my judgment the Court, knowing the precise amount awarded by the jury for past general damages is entitled, and indeed bound to apply the principles applicable to jury verdicts generally to this identified component, and to ask itself therefore whether this particular part of the award was so inadequate that no jury could reasonably have awarded it. The plaintiff gave evidence and was cross-examined at the trial. However, there was no attack, in the course of cross-examination, either on his honesty or on his reliability so far as the issue of damages was concerned. His complaints of pain and discomfort and disability associated with his injured back were not expressly challenged either as untrue, exaggerated or imaginary. Because of supposed issue estoppels arising out of a decision of the Compensation Court, the defendant accepted that if the jury found a verdict for the plaintiff they should include in their verdict the plaintiff's full loss of wages for a period of nearly four years from the date of injury to 7 August 1987 in the sum of $40,671.04. The question of the plaintiff's economic loss for the remaining period of nearly two years until the trial remained in issue, as did the question of future economic loss. These issues required the jury to assess the extent of the plaintiff's residual capacity and his motivation for work. On this issue the trial judge said in his summing up: "The case, of course, that Mr. Webster puts before you is that this plaintiff is totally incapacitated for the future and he will never work again. Mr. Arden, on the other hand submits, on behalf of the defendant, that there is some residual capacity, that he has got the will to work and he would like to give it a go and he has the capacity to do something." It is clear therefore that at the trial counsel for the defendant accepted the plaintiff's evidence on the issue of damages, and indeed relied upon it. Moreover, the defendant did not challenge the other lay witnesses called in the plaintiff's case on the damages issue. They were his wife, who gave extensive evidence, corroborating the plaintiff's complaints of pain, discomfort and weakness and his inability to sit in one place for any length of time. She also said that he had not had a day's illness prior to the injury. She was not cross-examined. One of the plaintiff's daughters also gave evidence on these issues and was not relevantly cross-examined. Two old male friends also gave evidence of the plaintiffs difficulties in his leisure activities because of his pain and discomfort, and the fact that he was a different person since his injury. Neither of these witnesses were cross-examined. The plaintiff also called three medical experts, two orthopaedic surgeons and one psychiatrist. They were cross-examined but no questions were asked about the possible subjective nature of the plaintiff's symptoms or his complaints of pain and weakness. The defendant did not call any medical evidence in its own case or, indeed, any evidence on the issue of damages at all. In these circumstances the jury, acting reasonably were, in my opinion, bound to accept the substance of the plaintiff's case on damages, uncontradicted and unchallenged as it was. Although we were not referred to it the decision in Precision Plastics v Demir (above) at 370-371 per Gibbs J, in my opinion, is directly in point on this question. I conclude therefore that the award of $15,000 for general damages for a period of nearly six years between the injury and the trial, which included a period of nearly four years for which the jury were directed, by agreement, to allow the plaintiff his full wage loss, was so inadequate that no jury could reasonably have awarded such a low amount. URJ McLEOD v PACIFIC WASTE MANAGEMENT (NSW) PTY LTD (Handley JA) 3 Mr. King, who appeared for the respondent but who had not appeared at the trial, in attempting to support the verdict, relied strongly on evidence given by Dr O'Brien and Dr Hudson, the treating orthopaedic specialists. The plaintiff had a pre-existing degenerative condition of spondylitis in his spine which made him vulnerable to injury, and such injuries could be caused by simple every day incidents such as lifting objects out of the boot of a car or tying up one's shoe laces, which might have nothing to do with the plaintiff's work. However, it seems to me that counsel then appearing for the defendant relied on this evidence only on the issue of liability. The plaintiff continued to work for some few days after the accident and before he experienced significant pain and became unfit for work. The defendant's case before the jury was that the onset of these symptoms some days later was due to back strain caused, at that time, by some other activity in which the plaintiff was engaged and was not a delayed result of his earlier fall. Since the plaintiff could have developed his symptoms from bending to tie up his shoe laces, the defendant's case to the jury was that he developed his symptoms from some equally trivial act some days later in the course of his ordinary work in circumstances which did not attract any liability for negligence. If the jury had taken this view of the evidence the plaintiff would have failed on the issue of causation and the jury should have returned a verdict for the defendant. The trial judge gave the usual direction that a defendant takes the plaintiff as he finds him and that it is the defendant's bad luck if, as he said, "the plaintiff has some condition which makes him more likely to suffer injury or adverse consequences than other persons". No objection was taken to this direction by counsel for the defendant and no redirection was sought. The judge's directions to the jury that they should discount their award for future economic loss for contingencies and vicissitudes was expressed in general terms, and, did not refer to the contingency or risk the plaintiff may have suffered similar disabilities because of his weakened back, even if he had not been injured through the defendant's negligence. If counsel then appearing for the defendant had relied, in his address to the jury, upon evidence of the pre-existing degenerative condition of the plaintiff's back to reduce the plaintiffs claim for economic loss, his Honour surely would have dealt with this argument in his summing up and reminded the jury of the relevant evidence. He did not do so and the defendant's counsel did not seek any further direction on this issue. I conclude therefore that at the trial the defendant elected not to rely on the existence of this degenerative condition as a basis for reducing the plaintiff's damages for economic loss. In general a party is bound by the way in which his case is conducted at the trial, especially a trial before a jury. For this purpose it does not matter why a party's case was conducted the way it was. However, in the present case it is certainly possible that the defendant's counsel deliberately elected to rely upon this medical evidence on the issue of liability alone, bearing in mind that if he relied on it on the damages issue as well this could prejudice the defendant's prospects of securing a verdict from the jury. The balance of the verdict, after deducting the agreed components, was $87,380, comprising, as I have said, $15,000 for past general damages and $72,380 for future general damages and economic loss from 7 August 1987 onwards. 4 UNREPORTED JUDGMENTS The plaintiff was 48 at the date of the accident and 54 at the date of trial. He then had a life expectancy of some twenty years. Allowing for a further $10,000 for past general damages and a conservative $45,000 for future general damages this would leave only $22,380 for economic loss from 7 August 1987 until trial and thereafter into the future until the usual retiring age of 65. Any such award for economic loss for this period would obviously be grossly and unreasonably inadequate. If one considers the balance of $72,380 after deduction of the agreed components in the light of the evidence on the issue of economic loss, putting to one side the question of general damages for the moment, one arrives at a similar conclusion. The wage rate applicable to the plaintiff's old job at the date of trial was $528 per week net. The only specific issue left to the jury on the question of economic loss for the period after 7 August 1987 concerned the extent of the plaintiff's residual capacity for work and the wages he might be able to earn through the exercise of that capacity. The plaintiff had been unable to obtain a job after his injury, despite efforts to do so. He gave evidence that employers ceased to be interested in employing him as soon as they found out that he had been on Workers' Compensation for a substantial period with a bad back. The trial judge left the issue of the plaintiff's economic loss after 7 August 1987 to the jury in general terms. He could do little else because there were many imponderables. Neither counsel objected to this part of the summing up. Given the absence of any challenge to the evidence of the plaintiff the lay witnesses and the doctors on this issue it is difficult to see how a jury, acting reasonably, could allow more than the figure of $200 per week for the value of the plaintiff's residual working capacity at the date of the trial. This was the figure which Mr. Toomey accepted, in his written and oral submissions, on behalf of the appellant. Indeed, a finding that the plaintiff retained an earning capacity of that value may indeed be somewhat generous to the defendant, in the light of the evidence of the plaintiff's unsuccessful efforts to obtain work and the attitude that employers adopted once it was known that he had been on Workers' Compensation for an injured back. Nevertheless, it was the figure suggested by the appellant's senior counsel, and I am content to adopt it. On this basis the plaintiff's future economic loss to age 65 at the date of trial, with an allowance of 10% for contingencies, would give $144,684 for future economic loss. While age 65, and an allowance of only 10% are both debatable, it is clear that the jury, acting reasonably, must have awarded substantially more than the sum of $72,380 for future economic loss without any allowance for future general damages or for past economic loss from 7 August 1987 to the date of trial. In respect of this latter period the parties agreed that if the plaintiff had continued to work in his old job he would have received $49,601. If one allowed a comparable sum to the value of any residual capacity for work that the plaintiff retained, similar to that suggested as at the date of trial, one again arrives at a substantial figure for the plaintiff's minimum wage loss during this period of nearly two years. In my judgment the appellant has demonstrated that the verdict of this jury cannot be allowed to stand and must be set aside. The remaining question for this court is whether it can and should reassess the damages itself or whether the case must be returned to the Common Law Division for a retrial, limited to the issue of damages. Mr. Toomey, of Queens URJ = McLEOD v PACIFIC WASTE MANAGEMENT (NSW) PTY LTD (Clarke JA) 5 Counsel for the appellant submits that this court should reassess, while Mr. King for the defendant submits that a new trial should be ordered. In my judgment the court is entitled to reassess damages in this case and is not constrained to order a new trial. The case is covered, in this respect also, by the decision of the High Court in Precision Plastics v Demir. The court is not required to assess conflicting evidence on the issue of damages because the defendant called none. Nor is the Court required to make critical findings on questions of credibility because the evidence of the plaintiff and his witnesses on the issue of damages was not challenged at the trial on this basis. Accordingly, in my opinion, this Court can and should reassess the damages pursuant to s107 of the Supreme Court Act. I consider that it is appropriate in this case for the Court to make a higher than usual allowance for contingencies in assessing the plaintiff's economic loss, both for the period from 5 August 1987 to trial and thereafter for the future, to reflect the real risk referred to by Doctors O'Brien and Hudson, that the plaintiff might have become incapacitated for work from other causes long before reaching his normal retiring age of 65. I would, myself, reassess the plaintiff's damages as follows: $ (a) Agreed out of pocket expenses and past wage loss 55,981 95 (b) Past general damages 25,000 00 (c) Future general damages 45,000 00 (d) Economic loss 5 August 1987 - 30 June 1989 62% 27,624 35 of agreed figure discounted by 10% for contingencies (e) Future economic loss $328 per week for 11 years 112,504 00 discounted by 30% for contingencies (f) Interest on past general damages at 2% for 5 years 3,875.00 9 months in accordance with MBP (SA) Pty Ltd v Gogic (1991) 65 ALJR 207 For a Total of $268,985.30 I would add that the figure of 62 pc, which I have applied to the agreed amount of $49,506 for wages that the plaintiff would have earned had he remained in his old job during the period from 7 August 1987 to the date of trial, is based upon the proportion of $328 being the plaintiff's wage loss at the date of trial, as submitted by Mr. Toomey, to $528 being the wages payable for the plaintiff's old job as at the date of trial. I would therefore propose that the appeal be allowed. That the jury's verdict be set aside. That there be substituted a verdict for the plaintiff for $268,985.30 and that after deduction of the agreed sum for Workers' Compensation there be judgment for the appellant for $191,650.30, such judgment to date from the date of the jury's verdict, 30 June 1989. The appellant, of course, must have the costs of the appeal to be paid by the respondent and the respondent, if qualified, is to have a certificate under the Suitors Fund Act. Samuels JA I agree. Clarke JA I agree. 6 UNREPORTED JUDGMENTS _ Appeal allowed 2. Jury's verdict set aside and in lieu thereof there be substituted a verdict for the plaintiff for $268,985.30 and that after deduction of the agreed sum for Workers' Compensation judgment for the appellant in the sum 5 of $191,650.30 to date from 30 June 1989. 3. Respondent to pay the costs of the appeal and if qualified to have a certificate under the Suitors Fund Act. Counsel for the Appellant: B TOOMEY QC and D KENNEDY 10 Counsel for the Respondent: L KING Solicitors for the Appellant: TEAKLE ORMSBY and ASSOCIATES Solicitors for the Respondent: CURWOOD and PARTNERS