SCONE ABATTOIRS PTY LTD & ANOR v WOODS SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MEAGHER, HANDLEY and COLE JJA 19 March 1997, 19 March 1997 [1997] NSWCA 278 NEGLIGENCE — no principle of principle — appellant liable for costs of fund management breach tortous conduct produced fund requiring management. Cole JA On 18 October 1996 Grove J entered a judgment in favour of the respondent Stephen Allen Wood in the sum of $2,345,494. His Honour found that the first appellant, Scone Abattoirs Pty Ltd, being the owner of a motor vehicle, and Ross Larkin, the second appellant, being the driver bore responsibility for a collision which occurred between the motor cycle ridden by the respondent and the meat van owned by the first appellant when they collided at about 11.00am on 14 July 1988 The appellants have appealed in relation to both liability and quantum. LIABILITY The accident occurred at about 11.00am on 14 July 1988 when the meat van collided with the motor cycle. Grove J noted that the case had been presented upon the basis that if the version of the collision presented on behalf of the plaintiff was correct, there had been a simple rear end collision and negligence had been established. If, however, the defendant's account of events was accepted there would necessarily be judgment for the appellants. The medical and mental condition of the respondent disabled him from giving evidence concerning the collision. On behalf of the plaintiff there was called a Mr Whyte. He was an independent observer seated on the bonnet of his motor vehicle with an unobstructed view at almost right-angles to the scene of the collision. At the time Orange Grove Road was being upgraded to four lanes. Only the western two lanes were in use, they being sealed. There was one southbound and one northbound lane in use, divided by a painted white line,. Mr Whyte noticed the plaintiff motor cyclist riding south down the gradient in Orange Grove Road at a slow speed. He saw that speed decrease and the motor cycle come to a halt for two or three seconds before it was hit. He also noticed the defendant's truck travelling about four car lengths behind the vehicle and appreciated immediately that it may have difficulty in stopping due to its speed. In fact it did not stop and it collided with the motor cycle. On behalf of the appellants there was evidence from Mr Larkin, the driver, and a Mr Toulson who was driving a vehicle north in Orange Grove Road. Mr Larkin had seen the respondent's vehicle which he assessed as being driven erratically and, accordingly, determined to keep it under observation. His account of the accident was that the motor cycle pulled to a halt on the left hand verge of the carriageway but that as he approached it the driver suddenly veered westward immediately across his path causing the collision. Mr Toulson gave a similar account. There was evidence from a police officer that there was debris approximately two yards on the eastern side of the white centre line. 2 UNREPORTED JUDGMENTS Grove J preferred the account of Mr Whyte noting that he was an independent witness in a sound position to view the accident. He accepted that whilst Mr Whyte may not have been in a position to notice any east-west axis movement of either the truck or the motor cycle, he did note that the motor cycle came to a halt for some few seconds before it was struck by the truck as he had anticipated it would be having regard to the speed of the truck. His Honour did not accept that Mr Larkin was travelling at an appropriate speed, nor that he was keeping the close lookout for the motor cycle as he had said. Travelling at 60 kilometres per hour, as Mr Larkin said he was, was negligent in the circumstances. His Honour thus preferred the evidence of Mr Whyte to that of Mr Larkin. Mr Toulson said the events he observed took place in a split second. His Honour noted both the coincidence of the account that each of Mr Larkin and Mr Toulson gave, and the circumstance that they had had discussion with each other, although the content of that discussion was not known. His Honour found it probable that Mr Toulson did not register any observation of the motor cycle until the very moment of impact, and that thereafter he had reconstructed the events by assuming that the vehicle must have come from the eastern side of the carriageway as he had not observed it in front of the truck before the collision. The resolution of the factual context of the accident was clearly a matter for the trial judge who had the advantage of weighing and assessing the witnesses giving the competing accounts. There is no empirical evidence which calls in question the trial judge's preference for the independent account of Mr Whyte. There is thus no basis for this Court disturbing that finding!. The grounds of appeal numbered | to 8 inclusive thus fail. DAMAGES Grove J awarded the following sums: Non economic loss 235,000.00 Past gratuitous services 210,429.00 Future gratuitous services 228,060.00 Future services until Mr Karl Wood's retirement 542.535.00 Future paid services after Mr Karl Wood's 595,428.00 retirement Provision of Transport 85,076.00 Home modification cost 73,270.00 Maintenance of domestic items 34,614.00 Items as identified by occupational therapist 27,403.00 Out of pocket expenses to date 25,343.00 Future treatment expenses 165,000.00 Fund management 122,336.00 TOTAL: 2,345,494.00 Each item, except non-economic loss was challenged by a ground of appeal. The substance of the challenge was that the respondent's pre-accident mental condition was such that there was a strong possibility, beyond 50%, that the 1. See generally Jones v Hyde (1989) 63 ALJR 349 at 251; DeVries v Australian national railways Commission (1993) 177 CLR 472; Zurvela v Cosmarnan Concrete Pty Ltd (1996) 71 ALJR 29 at 31. URJ SCONE ABATTOIRS PTY LTD & ANOR v WOODS (Cole JA) 3 respondent would have required full-time care irrespective of the motor vehicle accident Had this been found the assessment of damages would have been much lower. Grove J carefully considered what discount should be made because of the respondent's pre-accident condition. His Honour discounted the sum allowed for future care by Mr Woods Snr by 25%, and care after Mr Wood's retirement by 20% because of the prior condition. In making his assessment of the respondent's likely future had he been not injured by the accident, Grove J accepted the view of Professor Broe. Shortly stated it was that pre-accident the plaintiff was diagnostically psychotic. However he was "fully independent and functionally intact in terms of all personal care activities and domestic care activities. For significant times prior to the motor cycle accident on 14 July 1988, Stephen had lived alone in a flat and had cared for himself." All that was changed by the accident such that he became totally dependent. Further, his Honour accepted as giving "a balanced view of the before and after accident situation", the evidence of Dr J Sydney-Smith, retained by the appellants. That doctor expressed the view that, pre-accident, the respondent "would have been the chronic schizophrenic that is maintained at home or in a community group house but able to get around the neighbourhood, able to look after his hygiene. He would not have been incontinent as he is now. He may have been able to cope with sheltered work but I would doubt that he would have been able to cope with employment within the open market." Having regard to the found post accident condition of total dependence, no error has been shown in the assessment made by the trial judge. A particular submission was put in relation to two items, namely, past gratuitous services and future gratuitous services in respect of which no discount was made. It was submitted that in light of the respondent's psychiatric condition, there should have been some discount made in respect of those two items. In my view, no error has been shown in not allowing such a discount. The matter is dealt with by the trial judge in the judgment at appeal book pages 588, 589. It is apparent that his Honour took the view that in respect of those two items which are subject to a cap, the amount of damages otherwise payable in respect of each would far have exceeded the cap; it is because of that that he reduced them down to a capped figure. Two further specific submissions were put. One was that the discount made by his Honour of about 50% for the cost of future treatment expenditure in respect of psychiatric treatment was inadequate. There was evidence from Dr Sydney Smith and Dr Morse that the effect of the accident was to cause a change in the psychiatric condition such that additional treatment would be necessary. In those circumstances, the reduction by his Honour of one half of the cost of future psychiatric attendance and medication as being related to the pre-accident medical condition, has not been shown to be in error. The remaining specific submission put was that there should be no allowance at all in respect of fund management because of the respondent's prior psychiatric condition. It was said that that condition would result in him being unable to manage funds in any event. I would reject that submission. Pre-accident, the respondent had no funds to manage. The tort for which the appellants have been held responsible resulted in him acquiring a fund which also requires to be 4 UNREPORTED JUDGMENTS managed. In those circumstances, it seems to me that the necessity for the fund and accordingly the costs flow from the tortious conduct for which the respondents are responsible I would propose that the appeal be dismissed with costs 6 Meagher JA I agree. Handley JA I agree. Appeal dismissed with costs. Counsel for the Appellant: JD Hislop QC with GA Laughton Solicitors for the Appellant: Booth Mather Blackmore 15 Counsel for the Respondent: CT Barry QC with RWC Royle Solicitors for the Respondent: Blessington Judd