HAINES v LIPPL SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CLARKE, MEAGHER JJA and Hope AJA 17 May 1991, 4 June 1991 [1991] NSWCA 136 TRESPASS — ASSAULT — DAMAGES APPEAL — COMPENSATION — NO QUESTION OF PRINCIPLE Clarke JA On the evening of 30 October 1983 the respondent was in his house atl17 York Street, East Gosford, with his son Louis and his son's then fiance, Miss Kim Vaisey. At about 8 pm a number of police officers, including the second appellant, entered the house. All police officers were armed, the second appellant and another officer, Det Sen Const Paul Raymond Navin, being armed with shotguns and the other police officers with service revolvers. The respondent claimed that the second appellant prodded him in the abdomen with a shotgun and that, as a result, he fell to the floor, first striking his head and then his back while falling. He alleged that when he was on the floor the second appellant kicked him in the groin. It was not disputed that the respondent was injured as a result of being struck by the second appellant's shotgun although there was disagreement as to the circumstances in which that occurred. Those injuries included a considerable laceration to his left upper lip, requiring some thirty stitches, and damage to his top gum and to a number of his teeth. Following this incident the respondent was taken to the Gosford Police Station. According to him he had been unlawfully compelled to go there. He claimed that the whole incident, including the physical injuries, led to significant psychological consequences and that in the result he had been unable to work and had suffered both mental and physical anguish. He sued the appellants claiming damages for the trespass constituted by the entry of the police officers into his home, which he said was an unlawful entry, assault in respect of the injuries he received at the hands of the second appellant and false imprisonment in respect of his detention at Gosford Police Station. At the trial his claims were rejected by the trial judge who entered judgment for all defendants. The respondent thereupon appealed to this Court which allowed his appeal in respect of the counts of assault and trespass, set aside the orders of the trial judge and in lieu thereof directed the entry of judgment on those counts in favour of the respondent. The Court also ordered that the respondent's claim for damages in respect of the trespass and assault be referred to a Master of the Common Law Division for assessment in accordance with the reasons of the Court. In due course Bruce AJ was called upon to assess the damages. On 3 August 1990 he gave his judgment in which he awarded the respondent $208,166.00 made up as follows: Damages for trespass $5,000 Interest $2,800 General damages for assault $70,000 Interest $28,600 2 UNREPORTED JUDGMENTS Out of pocket expenses $2,566 Future dental treatment $6,000 Past economic loss $43,000 Interest $24,600 Future economic loss $25,600 TOTAL $208,166 Neither party found this award satisfactory. The appellants have appealed challenging the awards in respect of general damages, past economic loss, future economic loss and interest on general damages. They claim that the awards were in each instance excessive. For his part the respondent has cross appealed challenging each of those components, with the exception of interest, upon the ground that the awards were inadequate. Additionally he contends that the damages for trespass were far too small. It is convenient, initially, to deal with those elements of the damages which have been challenged by both sides. His Honour observed that: "The plaintiff was subjected to the horrendous experience of a large number of armed men bursting into his home and being physically assaulted. He was threatened with a loaded and cocked shotgun and was physically struck with it with such force that he lost a number of teeth and required 30 stitches for the severe lacerations which he received. He fell to the ground and struck his head and back. He then felt what could have been kicks or blows down the lower back around his kidneys in the groin. It was after he had been subjected to this violence that he discovered that the persons invading his home were police who were unlawfully there and who unlawfully assaulted him. The plaintiff was eventually taken to hospital where his lip was stitched and his head was x-rayed..." He was then discharged. His Honour then continued: "After he went home he began passing blood. This decreased until it finally ceased after about three weeks. The plaintiff also had various bruises and marks as a result of the violent attack to which he was subjected but these gradually resolved. The plaintiff says, not unreasonably, that the business had played on his mind and that he was 'a nervous wreck'. He became distraught about the whole incident and very upset about his standing in the community." He no longer mixed with friends the way he did at the time of the assault. Tam not in any way minimising the other injuries; the most substantial injuries which the plaintiff has relates to his back and to his psychological condition." It is necessary to amplify these findings with material from the evidence of Dr McDonald, a psychiatrist, who was accepted by the trial judge, and from other evidentiary material which was not the subject of any challenge. The pain which the respondent has in his back is a continuous dull one and occurs even when the respondent is doing nothing. Additionally the respondent claimed difficulty with his bite, numbness and a tingling sensation in the lip. Of more importance is the claim which the respondent made, and which appears to have been accepted by his Honour, that the incident had played on his mind "totally, utterly, every minute of my life" and that he was "a nervous wreck". Dr McDonald thought that the respondent was suffering from a fairly severe reactive neurosis with depressive features which, apart from the physical aspects of his disability, gave rise to stress reactions causing considerable damage to himself and_ his relationships in the community in particular. Later he said that: URJ HAINES v LIPPL (Clarke JA) 3 ".., he (the respondent) has a severe generalised anxiety disorder with tension, physical as well as mental, restlessness, problems with sleep, irritability and difficulty in concentration". There are complaints of autonomic hyperactivity, viz sweating, excessive fatigue, shortness of breath, dizziness and light headedness. There is occasional depression of reactive type and at times severe enough to lead to suicidal preoccupation to get away from it all although no evidence of active intent." The doctor concluded that at the time of the consultation, on 4 April 1990, the respondent was more than 85 per cent incapacitated irrespective of physical ailments. A neurosurgeon, Dr Hudson, who was asked to evaluate the respondent's physical injuries, concluded that the respondent's main problems were of a psychological nature with significant functional pain in the back and legs. He thought that that element was playing a major role in his disability which he considered to be genuine and which was made worse by a feeling of marked grievance. The doctor did not think that active physical treatment would help him and believed that his condition was static and unlikely to change much in the future. In summary the picture is one of a person who was subjected to a horrifying and frightening experience in which he received physical injury. As a consequence of the experience and, perhaps, to some extent the injury, he became psychologically disturbed suffering generalised anxiety with the accompanying symptoms I have mentioned and a functional condition which caused him, in the relevant sense, pain in the back and the legs. In addition the incident has played on his mind most of the time since it occurred and he has become greatly disturbed about his standing in the community. The last mentioned matter is of no small importance. He was a person who had a relatively large circle of friends, who enjoyed a good reputation and who had never been in any trouble with the police. His perception, which was a real one, was that his community standing had been seriously affected and he had lost most of his friends. Although I have referred in slightly more detail to some of the evidence than his Honour did there is no doubt in my mind that in awarding the respondent $70,000 general damages the learned trial judge paid careful regard to those features of the evidence. I say this because of later references in his judgment to the evidence of the various doctors and his ultimate finding that the respondent had suffered an injury which had severely impaired his enjoyment of life since the incident. In considering whether the award for general damages should be set aside it is necessary to bear in mind two important matters. First, this court ruled when the case was previously before it that in the circumstances of the case it was not open to the respondent to claim aggravated and or exemplary damages. That ruling was accepted by the parties at first instance and on this appeal. Neither party suggested that that ruling was not binding nor did counsel for either party submit that this Court should regard the earlier stated conclusion of the court on the question of aggravated and exemplary damages as obiter dictum and determine that the facts of the case justified aggravated and exemplary damages. Both parties simply accepted that the court at first instance was bound to award proper compensatory damages for the torts and the argument in this Court was relevantly restricted to the questions whether the awards of $70,000 for the assault and $5,000 for the trespass afforded appropriate compensatory damages. 4 UNREPORTED JUDGMENTS The second matter is that neither party contended that any errors of fact or law flawed the two determinations I have just mentioned. Each side merely submitted that the ultimate figure at which this component of the damages was assessed was inappropriate compensation in the light of the established facts. The principles which the court should apply in considering this issue are well established. The relevant passages from some of the cases, in particular, Miller v Jennings, 92 CLR 190, and Wilkes v Bradford Kendall Ltd, 79 WN 850, are set out in the judgment of Priestley JA in Moran v McMahon, (1985) 3 NSWLR 700, at 716 et seq. In Miller Dixon CJ and Kitto J said (at p 197): "... the ultimate question, namely whether the compensation assessed is so inadequate (or excessive) as to be beyond the limits of what a sound discretionary judgment could reasonably adopt." In Wilkes the Full Court of the Supreme Court of New South Wales in reliance of what had been said by Dixon CJ and Kitto J in Miller listed five grounds (at p 853) which would justify the court in interfering with an assessment of damages in a personal injuries case. The only relevant ground for present purposes is ground 5 which read: "Tf, notwithstanding that the precise nature of the error is not discoverable, the result is so unreasonable or plainly unjust that the court will infer that an error has been made." I have not been persuaded that the award of $70,000 general damages for the assault is inappropriate compensation in all the circumstances of this case. I was initially minded to the view that the figure awarded was a high one but having heard Mr Spender QC, senior counsel for the respondent, I am not confident that the figure could be regarded as even being at the top of the permissible range. Whether it is or not is of no moment. What is important is that the award fell within the limits of a sound discretionary judgment. The next matter which arises for consideration is the award of $43,000 in respect of economic loss between the date of the incident and the date of trial. The respondent had been a self employed builder working in the Gosford district having first obtained his builder's licence in 1971. His income tax returns were tendered in evidence. Not surprisingly they showed that the respondent's earnings varied greatly from year to year, reaching a high point of about $13,000 in the year ended 30 June 1981 and a low reflected in a loss of about $3,000 a few years earlier. Although the court was required to compensate the respondent for the impairment of his earning capacity it was necessary to evaluate the impact that that impairment had, or might have had, on the respondent's earnings (Graham v Baker, 106 CLR 340, at 347). The variability of the respondent's pre accident earnings was not the only factor which made it difficult to assess the financial impact of the respondent's disabilities on his income. The difficulties of assessment were compounded by the fact that he had not worked since July 1981 and had been receiving unemployment benefits during the two and a quarter years preceding the incident. In particulars filed in court the following appears: "Tn July 1981 due to marital problems the plaintiff in fact sought unemployment benefits and he continued to obtain unemployment benefits intermittently up to the date of the assault. After the property settlement was reached with his former wife in July 1982 the plaintiff primarily devoted himself to carrying out building work around the former matrimonial home, 17 York Street, East Gosford, to prepare that property for sale. At the date of the assault, 30 October 1983, the plaintiff was in receipt of unemployment benefits and was also carrying out renovations and improvements to the former matrimonial home, that is, was URJ HAINES v LIPPL (Clarke JA) 5 carrying out building work without remuneration. The former matrimonial home was sold in early 1984... The plaintiff claimed that but for the assault he would have resumed full time employment as a self employed builder and carpenter from about April 1984." The respondent's evidence did not, however, support those explanations appearing in the particulars for his unemployment between July 1981 and October 1983. In summary he said that there was a recession in the Gosford area at the critical time and that was the main factor which led to his being out of work. He also said that although he may have done some repairs to the house during this period the bulk of the renovations had been carried out long before. The evidence simply did not support the proposition that he ceased work because of marital problems and that he had not reentered the workforce because he was fully engaged on renovations to his home. Nor did he give evidence to support the statement in the particulars that he proposed to start work again in April 1984. At the trial the respondent's counsel recognised these difficulties and the further difficulty which resulted from evidence given by the respondent that the income tax returns understated his gross earnings by 25 to 40 per cent. He sought to meet them by tendering evidence of the award rates of the National Building Trades Commission Award and Building Tradesmen (State) Commission Award and submitting that the proper method of evaluating the compensation for loss of earning capacity was to allow the respondent the relevant award rates from the date of the incident until the date of trial, deducting therefrom only the earnings which he had received when he worked in 1984 and 1986. The adoption of that approach would have led to an award in the sum of $74,340.00. There were, as it seems to me, many difficulties with this approach. In the first place the award rates could be no more than a broad guide. Further, the respondent had not worked for a period in excess of two years prior to the incident and had shown no inclination during this period to work in employment. Although he had an undoubted earning capacity during this time he simply did not put it to use. Quite apart from those matters, and the question whether he could have earned an amount equal to award wages while working for himself, there was an issue as to his residual capacity. The respondent submitted that he had demonstrated the full extent of his remaining capacity in the earnings of $12,500 received during the short times he worked in 1984 and 1986. Counsel for the appellant did not accept this approach and submitted that the respondent had retained a significant residual capacity and could, if he had wished, have earned far more. His Honour decided that it was appropriate to assess the compensation by reference to the award wages but considered that the respondent's claim did not truly reflect his residual capacity or the probability that he would not have been gainfully employed during portion of the period whether or not his capacity had been impaired. Accordingly his Honour did not accept that it was appropriate to deduct merely the sum of $12,500 but concluded that an approach which allowed the respondent half the award wages for the total period would represent the proper compensation. During the appeal both parties challenged this approach and based their attacks on what they each submitted was the proper construction of the passage in his Honour's reasons dealing with this subject. I do not think it necessary to repeat the detail of those submissions. It is sufficient for me to indicate that in my opinion his Honour adopted the following approach. First, he rejected the claim put forward by the respondent on the ground that it failed to give adequate weight 6 UNREPORTED JUDGMENTS to his residual capacity. Then, when he came to measure the compensation for the impairment to the respondent's earning capacity, he took account also of the possibility that the respondent, even if uninjured, would not have worked during the whole of the period between incident and trial. He then allowed the respondent half the award wages for the full period. In taking his course his Honour was, as it seems to me, recognising that the figures put forward were simply guides and was endeavouring to balance the factors thrown up in the difficult task which confronted him. Although it may be said that his Honour may have phrased this portion of his judgment more felicitously I do not think the court should accept either of the challenges for the simple reason that neither party has shown that the award was vitiated by an express error of fact or law or was of such a nature that error should be inferred. In relation to the future his Honour awarded $25,600.00. The respondent was born on 2 September 1929 and at the date of trial was aged nearly 61. His Honour found that the respondent did have some residual capacity but would not be able readily to return to the workforce. In all the circumstances his Honour concluded that the proper manner of measuring the impairment of earning capacity was to recognise a loss of about $130 per week and capitalise it using the 3 per cent tables. Counsel for the appellants submitted that his Honour had overlooked the fact that the respondent would, if the assault had not occurred, not have utilised his earning capacity more than half the time. Alternatively it was submitted that his Honour did make such a finding but failed to apply it in his calculations. On the other hand Mr Spender submitted that the adoption of a base figure of $130 per week was mistaken in the light of the fact that the award weekly wage at the time of trial was $318 net. Again no error of fact or law was demonstrated and the court was simply asked to infer that the result was so inappropriate as to demonstrate that there must have been an underlying, but unstated, error. In the light of the difficulties which I have earlier mentioned I am quite unable to agree. The award presents as one which was appropriate to take account of all the imponderables facing the court and certainly could not be said to be beyond the permissible range. The next substantial matter was the respondent's contention that the damages awarded for trespass were quite inadequate. They were, it was suggested, trifling and must necessarily have been based on a misconception on the part of the trial judge. There is no doubt that the trespass was a very grave one. But the respondent was awarded very substantial damages in respect of the assault which occurred during the time that Det Sen Const Navin and the other officers were trespassing in the respondent's house. There was a considerable danger of overlap and his Honour must necessarily have exercised caution in order to avoid this. The submissions put before the court focused on the right to security in one's abode which, it was said, was "one of the most ancient, precious and fundamental of common law rights". The sanctity of the home should be accepted, as should the fact that an award of damages is intended to operate, in part, in vindication of the innocent person's right to exclude trespassers from his home. But the facts on which Mr Spender QC relies in this case to support a much higher award were, in the main, relevant in my opinion to a claim for aggravated or exemplary damages. Aggravated damages are given, as Hope AJA pointed out in Lippl v Hines (Court of Appeal, 15 December 1989): "... to compensate a plaintiff when the harm done to him by a wrongful act was aggravated by the manner in which the act was done." URJ HAINES v LIPPL (Hope AJA) 7 Similarly exemplary damages are intended to punish the defendant. The unavailability of either of those categories of damages in the present case substantially weakens, if not destroys, Mr Spender's argument. Given all the circumstances of the case and the awards made in relation to the assault I do not think that any error has been established. Finally I come to a matter on which it will be necessary to adjust the verdicts. That is, the award of interest on general damages. It was submitted by counsel for the appellants, and accepted by Mr Spender, that in the light of the decision in MBP (SA) Pty Ltd v Gogic, (1991) 65 ALJR 203, it was necessary to reduce the interest on general damages from $28,600 to $6,750. In order to give effect to my reasons and this final matter the following orders should be made: 1. Appeal allowed. 2. Judgment of Bruce AJ set aside and in lieu thereof judgment be entered in favour of the respondent in the sum of $186,316.00 to date from 3 August 1990. 3. Appellants to pay the costs of the trial and of the appeal and the respondent to pay the costs of the cross appeal. Meagher JA I agree with Clarke JA. Hope AJA I agree with Clarke JA. 1. Appeal allowed. 2. Judgment of Bruce AJ set aside and in lieu thereof judgment be entered in favour of the respondent in the sum of $186,316.00 to date from 3 August 1990. 3. Appellants to pay the costs of the trial and of the appeal and the respondent to pay the costs of the cross appeal. Counsel for the Appellant: P HENNESSY Counsel for the Respondent: J SPENDER QC and P ROBERTS Solicitors for the Appellant! BINGHAM FINLAY TURNELL and CORAH, Gosford Solicitors for the Respondent: HK ROBERTS (State Crown Solicitor)