HAE RAN CHA v FORRESTER SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MAHONEY, SHELLER and CRIPPS JJA 10 November 1992, 10 December 1992 [1992] NSWCA 103 DAMAGES — QUANTUM — PERCENTAGE CONTINGENCY ALLOWANCE — TOTAL INCAPACITY FOR WORK The appellant claimed that damages awarded to the respondent in relation to injuries suffered by him, in a motor vehicle accident in 1988 for which the appellant did not dispute liability, were excessive. The appellant argued that the trial judge's findings that the respondent was totally incapacitated, and that this total incapacity arose from the 1988 accident, resulted from a material misapprehension of fact; that there was evidence of suitable work available to the respondent, who had not shown that he had taken all reasonable steps to pursue employment; that the 20 percent contingency allowance was too low; that the award for non-economic damage was excessive; and that the interest on that amount should have been calculated at a lower rate and reduced by $407. Held: 1. His Honour could reasonably find that the worker was totally incapacitated and that this arose from the 1988 accident. 2. As the respondent was incapable of working the existence or otherwise of work opportunities was irrelevant. 3. The percentage allowance for vicissitudes is discretionary, and his Honour was in a position to judge what was appropriate. 4. The award for non-economic loss was not unreasonable, and the issue of interest was de minimis, so the Court should not interfere with the trial judge's verdict. Mahoney JA I agree with the judgment of Sheller JA and the orders he proposes. Sheller JA This is an appeal by the defendant Hae Ran Cha from a judgment givenon 19 April 1991 by his Honour Judge Levine QC, as he then was, in proceedings brought by the respondent, John Owen Forrester, to recover damages for injuries, loss and damage suffered as the result of a collision between the respondent's vehicle and a vehicle driven by the appellant on 30 September 1988. The Motor Accidents Act 1988 applied to the accident. His Honour gave a verdict of $230,622 in favour of the respondent made up as follows: Damages for non economic loss ($32,100 - $16,050 $16,050) Interest 802 Out of pocket expenses 2,236 Past Economic Loss 31,824 Fox v Wood 210 Future Economic Loss 177,500 Future Treatment 2,000 Total $230,622 Liability was not disputed. 2 UNREPORTED JUDGMENTS The proceedings were consolidated with proceedings by the respondent against the Government Insurance Office of New South Wales in respect of another motor vehicle accident in which the respondent had been involved on 26 April 1986. In those proceedings, also, the respondent recovered damages but there has been no appeal by the defendant. However, the respondent was given leave in those proceedings to file and rely upon a notice of cross appeal to recoup him if the damages for non economic loss awarded in the proceedings under appeal were reduced. The appellant did not oppose this course. His Honour found that the first of the two accidents had been the more serious but caused less interference to the respondent's earning capacity. The second accident, although less severe, brought about a critical degree of aggravation of the respondent's condition which resulted in his having to give up work. His Honour found that the respondent was totally incapacitated for work. S39 of the Motor Accidents Act provides, so far as presently material, as follows: "(1) In assessing damages in respect of a claim, consideration shall be given to the steps taken by the injured person and to the reasonable steps which could have been or could be taken by the injured person to mitigate those damages by undertaking rehabilitation (including the formulation and undertaking of an appropriate rehabilitation plan) or undergoing medical treatment or pursuing alternative employment opportunities. (2) In any proceedings to enforce a claim, the onus of proving that all reasonable steps to mitigate damages have been taken by the injured person lies with the claimant." His Honour said that, in light of the opinions expressed by Mr Barry Bracken, an orthopaedic surgeon, who had examined the plaintiff on 6 June 1989, and his Honour's acceptance of the respondent's integrity and evidence, he had no difficulty in coming to the conclusion that there had been no relevant failure by the respondent to mitigate his damages by not taking the steps described in s39. At the date of the trial the respondent was 52 years of age. His Honour awarded damages for future economic loss on the basis that the respondent would continue in employment until the age of 65, that is to say for a period which his Honour rounded off at 13 years. He calculated a lump sum by reference to the net comparable earnings of two people working with the respondent's former employer. His Honour noted that it was conceded by the respondent that, given the respondent's condition over the relevant period and other health factors, the discount for exigencies should be higher than that which might normally be applied in such a case, and reduced the sum calculated by 20 percent. He calculated the damages for non economic loss at one-sixth of the maximum under s79 of the Motor Accidents Act. The appellant submitted that; (a) the respondent had not discharged the onus under s39 of proving that he had taken all reasonable steps to pursue alternative employment opportunities; (b) there was appellable error in his Honour's finding that the respondent was totally incapacitated by reason of the 1988 injury; (c) the contingency allowance of 20 percent was too low; (d) the damages for non economic loss under s79 were excessive; and (e) the interest awarded on this amount should have been calculated at a rate of 2 percent instead of 4 percent thereby reducing the amount by one half to $401. URJ HAE RAN CHA v FORRESTER (Sheller JA) 3 It is convenient first to deal with the finding of total incapacity. To some extent, and perhaps naturally, this argument turned upon a particular job opportunity said to have been available to but not taken up by the respondent. Mr Bracken's evidence, expressed in a number of reports, the last on 14 March 1991, was that the plaintiff was and remained totally unfit for work. In the course of his oral evidence Mr Bracken said: "Q. Where you expressed an opinion as to his inability to work, you were not suggesting there was no type of work that he could do? A. I was saying his skills and training were of a manual and mechanical nature and he had, he expressed the opinion he had no aptitude for clerical work. However clerical work requires people to look downwards for protracted periods and this may well upset him. It is difficult to place him. Q. If work were to be found - if an employer were to be found who would be predisposed towards this plaintiff and who was prepared to offer him work in some form of light duties which would suit his abilities, for example, answering telephones or involved in stock control movements or as a doorman, something of that nature, would you say he would be able to work at such duties? A. Yes." The appellant placed reliance on this in support of a submission that the respondent was fit for work of a clerical nature. However, in his report of 9 March 1990 Mr Bracken said of the respondent: "He said his headaches over the back of the head had been bad in the last six months and the only help he gets is from a hot water bottle applied to the neck while lying down. He said that he cannot work with his head in the downwards facing position for more than five minutes without a marked increase in pain in his neck and over the back of his head." Sundell Motors Marine and Diesel Service Pty Ltd had employed the respondent from 1969 until 1989. The appellant called Mr Barnet, an officer of that company who had engaged the respondent on its behalf. After the accident in September 1988 the respondent continued working sporadically from 9 October 1988 until 18 July 1989 when he experienced what was described as a complete loss of power in his left arm and hand whilst at work. He did not thereafter return to work. On 9 February 1990 he was advised by his employer that, since he did not anticipate returning to work in the foreseeable future, the firm was unable to keep his position open and accordingly gave him notice that his employment would be terminated as and from 27 April 1990. It was suggested that employment was still available from either Sundell or another associated organisation, Wartsila Diesel, a Finnish company operating in Sydney. Mr Barnet said it was his understanding that the respondent would be provided with a light duties job in the Sundell organisation. After he left work in July 1990 the respondent made no attempt to obtain employment. The respondent had a medical history going back to 1978 when he underwent two abdominal operations for which he was off work for two or three months. In 1979 he suffered from a stiff neck and, it seems, in 1980 a problem with his left shoulder. In 1984 he injured his low back at work. He gave evidence that as at the time of the first accident in April 1986 he had no neck or left shoulder problems and had had none since 1979; the lower back occasionally gave him slight problems when he stood up; but he lost no time off work nor had his working conditions or duties changed. He had no difficulties with his middle back. In 1985 he underwent a hernia operation. Later in that year he fell off a stationery bicycle and experienced pain in the right leg which lasted about three days. 4 UNREPORTED JUDGMENTS Following the 1986 accident he experienced pain in the neck and in the centre of his back and had a bad headache and soreness in the left shoulder. There did not seem to be any effect upon the low back condition at that stage. He was worse the day following the accident. After his return to work he noticed numbness in his left forearm and thumb, and later pins and needles. He found lifting and carrying difficult and had to obtain the assistance of Mr Barnet. He suffered stabbing pains in the centre of his back, his neck was very sore, and headaches troubled him as did his sore shoulder. He nonetheless continued to work although with increasing difficulty in lifting and twisting. Sitting for any period of time also induced discomfort and pain. There was an incident at home in which he burnt his hand whilst doing some oxy-acetylene work on the box-trailer which had been involved in the accident. He was unable to keep the torch steady and he noticed the smell of burning flesh, numbness apparently preventing him from otherwise feeling the trauma. In October 1986 he again underwent a hernia operation. Upon his return to work he still suffered pain and discomfort. It was heavy work which he did with assistance. In the September 1988 accident, the respondent's head went forward and hit the window frame and his back "kept going". His neck and middle back were very sore and now his low back was sore. There was increasing pain in his neck, mid back and low back; he went back to work and was more restricted in his activities than before the accident. His Honour said: "The significant event after his return to work following the second accident was an incident in July 1989 when he lost power in his left arm and hand after doing a lot of heavy lifting, a symptom different in its quality than had thitherto been experienced. Whenever, up to that time, the plaintiff had suffered this type of disability he was able, as it were, to move his head and neck around and power would be restored; this was different; he tried to restore power but failed and he went home early and on his return to work the next day there was still a diminution of power in his forearm. After leaving work the plaintiff has in effect been confined to pottering about his home, his behaviour has deteriorated in the sense that he is far more short tempered than he had been before, he is a person who has worked all his life and is desirous of working but feels incapable of doing anything. He has made no effort or taken no step to look for or obtain any employment." At the trial it was suggested that there were reasons for the respondent to leave work in July 1989 even though not totally incapacitated. However, his Honour said: "T accept the plaintiff as essentially a man of frankness and truth, as one who has worked all his life, as one would who really desires to work if physically capable of so doing, and I find that the two matters, either separately or combined, did not constitute the 'motivation' submitted to be the reality by the defendant." The appellant argued that his Honour's finding overlooked evidence of symptoms going back to 1979 and continuing. The respondent had seen Dr Hanley in relation to his sore neck in about mid-September. 1979 and in April 1980 was complaining to him of pain in his left shoulder, left elbow and a stiff sore neck. Dr Hanley said in evidence that in 1979 one of the respondent's complaints was a lack of sensation in his left hand and leg or, if not a lack of sensation, a sensation of pins and needles. The respondent complained of pains in the neck, waking early in the morning and pins and needles in his left arm with URJ HAE RAN CHA v FORRESTER (Sheller JA) 5 paraesthesia to his thumb. As to his lower back the respondent said in evidence that it had become gradually worse since 1984. In a report made on 21 June 1988, in respect of a work related injury suffered in February 1984, the respondent had said that approximately 18 months previously pain in the lower back started to increase. Various medical reports given in 1987 refer to injury to his low back at work in 1984 with the aches getting worse. A CT scan done in July 1988 showed some degenerative changes at the L3/4 and 4/5 levels. On 22 August 1988 Dr Johnston wrote that on 16 August 1988 the respondent gave him "a history of having jarred his back at work on | February 1984 in the wake of which he developed low back pain with which he was coping, but these symptoms have increased over the last 18 months, being associated with aching and tingling spread down the outer aspect of the left thigh and through the front of the shin to the left great toe. These symptoms are now increased by activity, bending, lifting, walking, to be relieved by rest." Since none of these matters was mentioned in his Honour's judgment the appellant argued that his finding that the 1988 accident resulted in total incapacity was flawed. The appellant further argued that in his first report of 6 June 1989 Mr Bracken stated that the respondent's major neck and upper spine problems started in April 1986 and that this inaccurate history undermined his conclusions in material respects. Reference was made also to evidence that suggested that the weakness in the respondent's left arm resulted from a functional condition. In cross examination Mr Bracken gave the following evidence: "Q. If the problems with his neck in 1979 had indicated pain in the neck, neckache, headache and some degree of loss of feeling and pins and needles in the left arm for some period of months, would you consider those symptoms would indicate the problems were more than just normal degenerative changes which you described to my learned friend as an aging neck? A. Not really because if he did have a little bit of nerve root irritation at that time it was probably because of the degenerative changes or some strain thereof and one must presume that the treatment he had relieved that problem." The appellant argued that the presumption that the treatment had relieved the problem was wrong. In his report of 9 March 1990 Mr Bracken said: "As things stand I would think that considering Mr Forresters trade training he is totally unfit for work and likely to remain so for the forseeable future directly as a result of his neck problems in large part and of his dorsal spine problems in lesser part. His complaints in respect of his low back are a function of normal age changes and constitute only postural low back pain." In summary the appellant's arguments were that the finding of total incapacity proceeded on a material misapprehension of facts as did the conclusion that total incapacity resulted from the 1988 accident; that the functional component was not dealt with and that there was evidence of available work opportunities. The respondent submitted that his Honour's conclusion was based not only on the evidence of Mr Bracken but also on the evidence of the respondent himself. It was said that it was by no means plain from the evidence of Mr Barnet that even if the respondent was capable of doing some light duty work, such work was available to him at Sundells. So far as the complaints in 1979 to Dr Hanley were concerned, these related to two incidents, one in 1979 and one in 1980. They were treated, apparently successfully, at the time without any interruption to work. So far as his lower back was concerned the respondent said that he had had 6 UNREPORTED JUDGMENTS problems with it over the years but that it had never stopped him from working. The doctor who operated on the respondent's hernia reported on 7 January 1991: "T gave him a certificate of unfitness from 2 October 1986 to 10 November 1986, when I expected that he would be fit for full work. I have not seen the patient since." It is necessary to bear in mind the particular advantage the trial judge had in assessing the evidence. "..... Where a trial judge has made a finding of fact contrary to the evidence of a witness but has made no reference to that evidence, an appellate court cannot act on that evidence to reverse the finding unless it is satisfied 'that any advantage enjoyed by the trial judge by reason of having seen and heard the witnesses, could not be sufficient to explain or justify the trial judge's conclusion': Watt or Thomas v Thomas [1947] AC 484 at 488". Per McHugh J in Abalos v Australian Postal Commission (1988) 171 CLR 167 at 178. His Honour pointed out the respondent was a man who worked all his life and who really desired to work if he was physically capable of doing so. He continued to work with few breaks until July 1989. I have no difficulty with his Honour's conclusion that he was thereafter totally incapacitated from working. His Honour was entitled to base this finding on the evidence of the respondent himself and Mr Bracken. I think, also, that taking account of the evidence as a whole, his Honour was entitled to conclude that it was the second accident which brought about the critical degree of aggravation of his condition which resulted in the respondent having to give up work. In my opinion there is no basis for interfering with his Honour's findings in these respects and the appeal on these grounds fails. In consequence of this there is no basis shown that the respondent had failed to take reasonable steps to pursue alternative employment opportunities. He was incapable of working. The percentage allowance for vicissitudes is an arbitrary one and a matter for the judge's discretion. It is true that there was medical evidence which suggested that, even if there had been no accident in September 1988, the respondent was unlikely to have continued in full time employment until the age of 65. On the other hand he had managed to remain in full time employment despite various accidents and health problems stretching back over many years. Moreover it was demonstrated that he had a sympathetic employer who had been prepared to keep the respondent on for a substantial period of time after he had given up work, presumably in the hope that he would return. His Honour heard the evidence and was well able to judge what was an appropriate allowance by way of discount. I do not think that it is open to us to interfere with the 20 percent that he chose. Similarly I do not regard the proportion of the maximum for non economic loss as unreasonable and again I do not think it is open to us to interfere. The matter of interest is de minimis. I would not be prepared to change the amount awarded by his Honour. Accordingly, in my opinion, the appeal should be dismissed with costs. Cripps JA I agree with the judgment of Sheller JA and the orders he proposes. Appeal dismissed with costs. Counsel for the Appellant: HG Shore Instructed by: GM Meadows URJ HAE RAN CHA v FORRESTER (Cripps JA) Counsel for the Respondent: CM Simpson Instructed by: Emmerson and Emmerson