MOORE-McQUILLAN vy GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES SUPREME COURT OF NEW SOUTH WALES KIRBY P, CLARKE and Cripps JJA 22 April 1992, 29 May 1992 [1992] NSWCA 162 DAMAGES — injury to back, neck, left arm and left knee of journeyman boilermaker — assessment of damages no question of principle — damages for loss of earning capacity past and future and for general damages increased. DAMAGES — injury to back, neck, left arm and left knee — journeyman boilermaker loses economic capacity — trial judge (Mitchelmore DCJ) enters judgment for $94,323 — appeal on ground of inadequacy — held: (Cripps JA; Kirby P and Clarke JA concurring): (1) The component of the judgment for future loss of earning capacity ($40,000) was manifestly inadequate even allowing for the trial judge's opinion of the plaintiff's lack of candour. This authorised allowing the appeal, a reassessment of damages by the Court of Appeal and substitution a component of $80,000; (2) Upon the reassessment, the components for general damages should also be increased from $25,000 to $45,000 and past loss of earnings from $15,000 to $25,000 — no question of principle. ORDERS 1. Appeal allowed; 2. Judgment of his Honour Judge Mitchelmore set aside except as to costs and in lieu thereof judgment entered in favour of the plaintiff in the sum of $170,143.00; and 3. The respondent to pay the appellant's costs of the appeal. Kirby P I agree with Cripps JA. Clarke JA I agree with Cripps JA. Cripps JA This is an appeal from a decision of Mitchelmore DCJ on 12 February 1990 awarding damages to the plaintiff in the sum of $94,323. The plaintiff was injured on 21 May 1985 at Broken Hill. The defendant admitted liability and the only issue before the District Court was the quantum of damages. There were seven grounds of appeal: "1. The amount awarded for general damages is inadequate. 2. The amount awarded for past economic loss is inadequate. 3. The amount awarded for future economic loss and the loss of earning capacity is inadequate. 4. His Honour was in error in accepting the defendant's medical evidence and such acceptance was against the evidence and the weight of the evidence. 5. His Honour erred in not accepting that Manuel was a comparable earner. 6. His Honour erred in finding that the plaintiff had failed to mitigate his damages. 7. His Honour erred in finding that the plaintiff's capacity to earn was somewhat higher than $250.00 per week". For reasons which follow, I am of the opinion that grounds 4, 5, 6 and 7 have not been made out. I am of the opinion that ground 3 has been made out. Because the Court must assess damages afresh, it is not necessary for me to form an 2 UNREPORTED JUDGMENTS opinion as to whether, standing alone, I would have concluded that grounds | and 2 have been established. I am of the opinion, however, that upon reassessment the amounts awarded under these heads should be increased. As a result of the accident the plaintiff suffered injuries to his back, neck, left arm and left knee. He was unable to work for nearly five months after the accident. The plaintiff claimed that by reason of the accident he suffered a severe diminution of his earning capacity and that as a result of soft tissue injuries to his cervical and lumbar regions he was to the date of trial, and would continue to be for an indefinite period in the future, unfit for any work requiring significant amounts of bending, lifting or twisting of his back. The defendant, on the other hand, while not denying the immediate consequences of the injury, maintained that the plaintiff's earning capacity, although reduced, was better than the plaintiff claimed and that the plaintiff had failed to take reasonable steps to find suitable employment to mitigate his damages. The award of damages was made of as follows: Hospital/medical 1962.00 Past economic loss 25861.00 Interest 1500.00 Future economic loss 40000.00 General damages 25000.00 $94323.00 The defendant conceded liability for the medical expenses. It also conceded liability in an amount of $10,861 for loss of earnings for the period of almost five months following the accident when the plaintiff was unable to work. At the time of the accident the plaintiff was employed as a boilmaker with Radford Earthmovers Pty Ltd. He was then aged 26 and a journeyman boilmaker. Prior to the accident he had obtained various certificates of proficiency in respect of boilermaking, oxy welding and mechanical engineering. He had a good work history as a boilmaker before the accident. In March 1986 his employment with Radfords was terminated for reasons unassociated with the accident. I note, however, that the learned Judge accepted the plaintiff that he did not think he could have continued that work because of pain in his neck, back, foot, hip and knee. After his loss of employment with Radfords the plaintiff moved from Broken Hill to Adelaide. In February 1988 he was employed by Tubemakers Pty Ltd as a mechanical press operator at about $300 per week for a period of twenty weeks. As I read the judgment, the learned Judge accepted that the plaintiff was unable to continue working with Tubemakers by reason of the pain in his neck, back, hip, knee and foot. After leaving Tubemakers he went to Cairns. From July 1988 to November 1988 he worked as a diving instructor and was paid approximately $250 per week net. The learned Judge accepted that he lost his job because of two visits he was required to make to Broken Hill for the hearing of his case which did not proceed because the defendant was not ready. A number of medical reports were tendered but no doctor was examined or cross examined. The learned Judge accepted the medical prognosis advanced by Dr Anderson who examined the plaintiff on behalf of the defendant. Dr Anderson examined the plaintiff on 28 April 1989. He expressed the following opinion: WRIORE-McQUILLAN v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES (Cripps JA) "As a result of his accident, this man suffered from a number of soft tissue injuries. I think for all practical purposes his neck has fully recovered, as have the injuries to his lower limbs." The fourth around of appeal alleged that the learned judge was in error in accepting Dr Anderson's medical evidence because, it was said, that such acceptance was "against the evidence and the weight of the evidence". However, I do not understand that ground to be relied on any longer. Quite apart from anything else, it proceeded from an apparent misunderstanding by the plaintiff with respect to the finding of the learned judge. He did not accept Dr Anderson's opinion with respect to the plaintiffs low back injury "that any true disability that might be attributable to the accident is small in degree". Indeed, the learned Judge found, in terms: "The plaintiff's back injury will, for some considerable time in the future, stop him from doing heavy boilermaking type work". The plaintiff called evidence from Mr Denis Manuel, a boilermaker living at Broken Hill and employed by North Broken Hill Pty Ltd. He gave evidence that for the year 1988-1989 he earned $610 per week net. The learned Judge accepted that the plaintiff would have been earning more than $300 per week as a boilermaker in 1988 - at the time when the plaintiff was working for Tubemaking Pty Ltd. However, he was not satisfied that Mr Manuel was relevantly a comparable earner. It is alleged that the learned Judge erred in not accepting Manuel was a comparable earner. At the hearing of the appeal, the plaintiff handed to the Court an affidavit of Mr Christopher Kingston, the plaintiff's solicitor, referring to what the plaintiff's solicitor alleged was an agreement whereby both parties would accept Mr Manuel's earnings as comparable. It also referred to the note on the file by Urquhart QC DCJ on 17 May 1989, "Mr Denis Manuel is agreed to be a comparable wage earner". The problem, however, with the plaintiff's submission is that the defendant did not agree that he had accepted Mr Manuel as a comparable earner and at the trial in March 1990, the learned Judge heard evidence concerning the nature of Mr Manuel's employment and, on the evidence before him, concluded (as he was entitled to), that Mr Manuel was not relevantly a comparable earner. In my opinion, that ground of appeal must, therefore, fail. With respect to his claim for future economic loss, the plaintiff gave evidence that he was anxious to retrain either as a marine biologist or a mechanical engineer. The learned trial judge allowed $40000.00 for future economic loss being the sum necessary, if invested at 5 per cent, to provide the plaintiff with an income of $100 per week for the next ten years. The learned Judge accepted, as I read the judgment, that the plaintiff at all relevant times had, and would continue to have, a significant disability. He said, however, that the plaintiff was lacking in candour because he had failed to disclose in his evidence in chief, first, that he had had a previous accident to his back and, second, that he had undertaken certain work in 1989 with O'Halloran's Dive Shop in Adelaide where he had given lectures and been rewarded by payment in kind. The learned trial Judge found that the plaintiff, although suffering a disability, had a higher earning capacity than $250 per week as claimed by him. That is not a view I would have come to on a mere reading of the transcript. However, that is not the test. In my opinion, the conclusion of the learned judge was open and, on the evidence in this case, it is not a finding that this Court should interfere with. He also concluded that the amount earned by Mr Manuel as a boilermaker was $610 per week net was higher than that which the plaintiff would have 4 UNREPORTED JUDGMENTS earned had he been uninjured and remained a boilermaker. In my opinion, that finding was open and should not be disturbed on appeal. Nonetheless, accepting all these findings by the learned trial Judge, I am of the opinion that the amount in the sum of $40,000 for loss of earning capacity in the future was manifestly inadequate. It is true, as Mr Elkaim has submitted on behalf of the defendant, that the learned Judge did not accept the plaintiff's claim that he was entitled to an amount per week being the difference between Mr Manuel's earnings of $610 and the earnings of a diver. However, as I have said, the plaintiff had a significant disability and the case was conducted by both sides, in part at least, upon an assumption that the period the plaintiff might be required to spend at a tertiary institution studying full time was relevant on the question of future economic loss. The plaintiff claimed the sum of approximately $160,000 being made up as to $20,000 loss of earnings for a period of one year until the university course started and thereafter $610 per week during the period of study. The learned judge selected the figure of $40,000 because he said it would assist the plaintiff "to obtain higher qualifications". He appeared to accept that the plaintiff would be physically incapacitated for ten years. He said that the sum of $40,000 represented an amount necessary to yield the plaintiff the sum of $100 per week for the next ten years at the appropriate interest rate. It would seem to me, with respect, that the plaintiff's loss of earning capacity was well in excess of $100 per week. If the plaintiff is to retrain and thereby mitigate his damages so that at the end of the retraining period, although suffering from disabilities, he will have the same earning capacity as before, it cannot be assumed that the plaintiff would be able to exploit his earning capacity as if he were not doing a university course. On the other hand, if the plaintiff does not undertake training for higher qualifications, the findings of the learned judge make it plain that he will continue to suffer diminution of earning capacity for which he must be compensated. As I have said, it would seem that the Judge accepted a period of approximately ten years. The learned Judge held that the plaintiffs earning capacity was more than $250. However, he also held it was less than that which a boilermaker could earn and, although the learned Judge was entitled to consider that Mr Manuel's wages were not comparable, the plaintiff's loss of earning capacity must have been in the order of $200 - $250 per week. That being so and to use his Honour's approach, I would allow the sum of $80,000 for future economic loss being the present value of $200 per week for ten years at 5%. It is also submitted that the amount awarded by the learned Judge of $25,861 for past economic loss was inadequate. The learned Judge accepted that the plaintiff was entitled to an amount of $10,861 being the amount of wage loss up to the date of his retrenchment from Radfords. He found that while the plaintiff worked for Tubemakers he was earning approximately $300 per week net and he accepted that boilermakers's wages at that time would have been higher than $300 per week. He did not accept that Mr Manuel's wages reflected that which the plaintiff would have been earning had he not been injured. The learned Judge awarded only $15,000 for the period April 1986 until March 1990. During that time the plaintiff had earned approximately $300 per week at Tubemakers and $250 per week as a diver on Hook Island. He lost his job as a diver by reason of having to come back to Broken Hill twice for the Court case. I am prepared to accept that the plaintiff's "lack of candour' may have influenced the learned Judge with respect to his claim that he did all he could to mitigate his damages. Nonetheless, when all is said and done, the plaintiff had a WRIORE-McQUILLAN v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES (Cripps JA) significant disability. The trial Judge found that when working with Tubemakers Pty Ltd he was not earning as much as he would have earned had he worked as a boilermaker and that boilermaking work was beyond him. I accept the submission made by Mr Elkaim, on behalf of the plaintiff, that because the learned Judge was not satisfied that the plaintiff had mitigated his loss and that his earning capacity was in excess of $250 per week and that he would not have been earning $610 per week, it was necessary for him to make an assessment in the nature of a general sum. But, in my respectful opinion, on the findings made by the learned Judge, the sum of $15,000 for the loss of earnings between April 1986 and March 1990 was too low. Taking account of his Honour's findings, I would award $25,000 for this head. The learned judge awarded the sum of $25,000 for general damages. He found that prior to the accident the plaintiff was an active and fit person and that by reason of the accident up until the date of the trial he had suffered a considerable amount of pain from his back, neck, hip, knees and foot. It was not suggested to the plaintiff in cross examination that he exaggerated any of his complaints and all complaints were consistent with the medical evidence. The findings of the learned Judge were that the plaintiffs suffering will continue in the future. His back will continue to cause him problems. If he walks excessively or tries to undertake certain types of exercise he suffers low back pain. That will continue. I am of the opinion that the sum of $45,000 should be awarded for general damages. Accordingly, I would award the plaintiff the following: Hospital and medical $1962.00 Past economic loss $35861.00 Future economic loss $80000.00 General damages $45000.00 The plaintiff received $9713 "by way of social service benefits". I do not think it appropriate to allow interest on that amount of money because, I infer, if that amount is repayable, the plaintiff will not be required to pay interest. However, he is entitled to interest on the sum of $26148 which for four years at 7 per cent amounts to $7320. Accordingly, I would award the plaintiff damages in an amount of $170,143. The following orders should be made: 1. Appeal allowed. 2. Judgment of Mitchelmore DCJ set aside, except for costs and in lieu thereof enter judgment in favour of the plaintiff in the sum of $170,143. 3. Respondent to pay appellant's costs of the appeal. Counsel for the appellant: CK Hickey Solicitors for the appellant: Fitzpatrick Swift Counsel for the respondent: MA Elkaim Solicitors for the respondent: Solicitor for the Government Insurance Office of New South Wales