RAYNER v McQUEEN SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MASON P, BEAZLEY and STEIN JJA 15 July 1997, 15 August 1997 [1997] NSWCA 260 Damages — personal injury — MVA — Contributory negligence — within broad discretion. Non-economic loss — proportion of worst case. Past loss of earnings — earnings on which calculation based should be typical. Future loss of earnings — assessment disproportionate to the circumstances. The appellant was struck by a motor vehicle while walking on the roadway at night. He was found to have been guilty of contributory negligence. He challenged this finding and the percentum degree assessed by the trial judge. The appellant suffered significant injuries, but challenged the amounts awarded for non economic loss, and past and future loss of wages as excessively low. Held: Degree of contributory negligence assessed by the trial judge was within his broad discretion. The degree of non-economic loss assessed as a proportion of a worst case was disproportionate to the circumstances. Past loss of wages - previous wages on which calculation is based should be typical, or adjustment made. Future loss of earnings - trial judge's assessment was wholly disproportionate to the circumstances. Pennington v Norris (1956) 96 CLR 10 applied Gamser v Nominal Defendant (1977) 136 CLR 145 applied Nicholson v Nicholson (1994) 35 NSWLR 308 referred to. Stein JA This is an appeal from a decision of Pain DCJ delivered in the District Court on 4 April 1995. His Honour awarded the plaintiff (appellant) $101,992.42 for personal injuries sustained in a motor vehicle accident which occurred on 2 February 1991. There is no issue that the defendant (respondent) was negligent in failing to keep a proper lookout. However, his Honour found the appellant guilty of contributory negligence, which he assessed at 20%. Both of these findings are challenged. The court awarded $43,000 for non-economic loss, being 25% of a most extreme case and it is submitted that this is excessively low. Past loss of wages were assessed at $22,746.68 and the appellant contends that this is also, excessively low. Finally, Judge Pain awarded $47,500 for loss of future earning capacity. This is also challenged. There is agreement as to one matter. Apparently in reliance upon the solicitors for the respondent, the judge was given an erroneous figure as agreed out-of-pocket expenses. The figure his Honour included was $6,743.85. It should have been $8,462.65. The accident and findings At about 10.45 pm on Saturday 2 February 1991 the appellant (who was with two other persons who were hitch-hiking) was walking west along Cessnock Road, Weston. The appellant was struck by a westbound motor vehicle being driven by the respondent. The road, which ran east-west, was quite wide - 24m 2 UNREPORTED JUDGMENTS from kerb to kerb. A broken centre line divided the bitumen surface providing a carriageway for west-bound traffic of 11m. The street lighting was reasonable. The plaintiff and his companions were wearing (for the most part) light coloured clothing. The road was straight, flat and dry. The respondent had her headlights on, but did not see any of the pedestrians prior to the impact. The appellant has no recollection of the accident. His Honour found that the appellant was struck at a point approximately 5 m out from the southern footpath of the road. This finding was based upon the evidence of Sergeant Edwards who attended the accident scene shortly afterwards and saw the pedestrians lying on the roadway. He ascertained the point of impact from the position of the respondent's vehicle and the position of the bodies on the roadway. The officer was not cross-examined by the appellant's counsel on the position of the point of impact. His Honour made it plain that he preferred the evidence of the police officer on the point of impact and on other matters where there was a difference in the evidence. Having found the respondent to have been negligent in her driving, the judge said: ..it is apparent from the evidence, both oral and photographic, that there was a footpath available on the southern side of Cessnock Road which could have been used by the pedestrians. It being night time, I find that the plaintiff was, to a significant degree, by walking in the same direction as the west bound traffic with his back to it, and well on to the roadway in the lane for west bound traffic, the author of his own injuries. (AB 353) The proportion of responsibility for the accident was attributed by his Honour at 20%. It is convenient to first consider the challenge on contributory negligence before turning to the issues on damage. Contributory negligence The respondent gave evidence. She said that she was travelling towards the middle of the road, closer to the centre line than the kerb. She was not cross-examined on the point of impact. The respondent's husband, David McQueen, gave evidence. He was a front seat passenger in the car being driven by his wife. He was cross-examined on the point of impact. It was suggested to him by the appellant's counsel that the impact took place 5m out from the kerb. He said 'we were fairly close, I mean a metre or two off the centre line.' This was followed by: Q. You wouldn't be able to dispute that the point of impact was about five metres out from the kerb, would you? A. I couldn't accurately dispute that, no. The appellant's evidence was that he was walking 'probably about 4-5 feet out, from the gutter.' He did not recall the accident and woke up in hospital the following morning. Senior Counsel for the appellant submitted that it was never put to the appellant that he could and should have been walking on the footpath, nor that if he had been walking toward the on-coming traffic, the accident could have been avoided. While the respondent bears the onus of proving contributory negligence, it is difficult to see how his Honour's finding on the point of impact can be challenged. The police sergeant was not cross-examined on his evidence determining the point of impact. Moreover, the respondent was not URJ RAYNER v McQUEEN (Stein JA) 3 cross-examined on the issue, but her husband was cross-examined to suggest that the point of impact was where the police officer said it was - a version he appeared to accept. The only contrary evidence was that of the appellant. There was of course limited opportunity to cross-examine the appellant as to the circumstances of the accident given his amnesia. Pain DCJ accepted the police officer's evidence as to the point of impact and preferred his evidence over any inconsistent evidence - which would include that of the appellant. While there was no direct evidence, the manner in which the case was presented and run meant that the judge was entitled to infer that the footpath was present at the time of the accident as it appears in the photographs which were tendered, although the photographs were taken 4 years later. In this respect, the mature trees growing on the footpath may be noted in the photographs which became exhibits R to V. His Honour was entitled to find that the accident occurred well out onto the roadway in the lane for west bound traffic; the appellant agreed he was walking facing away from the west-bound traffic (and the respondent) and that there was a footpath available. The finding of contributory negligence was well open to the judge. It is next submitted that the apportionment of 20% for contributory negligence was excessive. The appellant's argument is that on a comparison of the respective negligence of the parties, the respondent had unlimited opportunities to avoid the collision. To apportion 20% to the appellant was said to be so high in the circumstances of the evidence that this court should intervene and substitute a figure of between 5 and 10%. In Pennington v Norris (1956) 96 CLR 10, the High Court made it clear that the task of making an apportionment involves 'a very wide discretion' and 'much latitude must be allowed to the original tribunal in arriving at a judgment as to what is just and equitable. It is to be expected, therefore, that cases will be rare in which the apportionment made can be successfully challenged.' (at 15-16) His Honour made an assessment and comparison of the respective culpability of the respondent and the appellant. Given the wide discretion of the trial judge and the way in which he approached the issue, I can see no reason to intervene in the finding. Damages © Non-economic loss As Pain DCJ found, the appellant's injuries were serious and numerous. There is no question that his ability to lead a normal life has been significantly impaired. His Honour said: His injuries included a laceration to the left temporal portion of his skull; a linear fracture on the right side of his occiput; a fracture through the neck of the his left humerus with angulation and displacement of the humeral head; a midshaft fracture of his left clavicle with displacement and shortening; a comminuted displaced fracture through the neck of the left scapular; fractures of five of his left ribs; a comminuted displaced fracture of his right tibia involving articular condyles, a fracture of the upper third of the shaft of the right fibula with minimal displacement; a tear through the entire cruciate ligament of his right knee; and multiple abrasions, particularly to his face, back, right knee and shoulders, with extensive bruising; suffered a small pneumothorax in the left apex of his lung; and suffered shock and headaches for a significant period. 4 UNREPORTED JUDGMENTS The appellant was left with serious disabilities which will continue to interfere with his enjoyment of life and reduce his employment opportunities. He was 29 years old at the time of the accident, healthy and active. His Honour summarised the appellant's disabilities thus: While the plaintiff has made a good recovery from his serious injuries, he has been left with significant disabilities which interfere both with his recreational activities and potentially in the future to his earning capacity. He still has restrictions of movement in his left shoulder which droops, he still has difficulty at times with his right knee, which won't 'lock out' as he describes it: There is still one screw in place in that knee and it has a tendency on occasions to collapse. He has some residual tingling in two fingers of his left hand, has difficulty squatting, and is unable to run. He suffered scarring from some of his injuries, which is indicated in part by the photographs, now exhibit AA. His sporting activities have been restricted by his injuries and subsequent disabilities, although he is now able to participate in bowls and darts, and an occasional game of golf, but he had been unable to resume playing cricket, touch football, or scuba diving, nor indeed any sports involving running. The fractures to his right knee and left shoulder appear to make him more susceptible to the onset of arthritis at an earlier age than would have been anticipated had this accident not occurred. Added to this is the finding that there was a high probability that the appellant would require operations to his left shoulder and right knee in his 50's. The court also accepted the thrust of the opinion of Dr Burgess that by age 40 the appellant would be looking for relief from pain and modification of activity, as well as spending more time sitting than standing. His Honour assessed the non-economic loss as 25% of a most extreme case. On behalf of the appellant Mr Hislop QC submits that this is so excessively low as to warrant intervention. Forty to fifty per cent is said to be appropriate. The respondent argues that the assessment was within the trial judge's discretion, Gamser v Nominal Defendant (1977) 136 CLR 145. In view of the severe injuries of the appellant, his significant on-going disabilities, the loss of enjoyment of life (especially sport), the prognosis for deterioration, increasing incapacity and ultimately surgery at a relatively early age, I am of the opinion that the assessment of 25% of a most extreme case is so low as to be wholly inadequate. In my opinion, given his Honour's findings of the appellant's injuries, disabilities and prognosis set out above, 25% of a most extreme case is a wholly erroneous estimate of the damage suffered. It is one which can properly be seen as 'wholly disproportionate to the circumstances', Gamser (at 160). An appellant court should of course be hesitant in interfering given the range of findings open to the trial judge. Nonetheless, 25% was simply outside the range. In my opinion a proportion of 40% of a most extreme case should be substituted. That is an appropriate proportion given the significance of the appellant's injuries (including his comparative youth at the time of the accident) and his continuing disabilities. The reassessment should be calculated on the present highest sum for non-economic loss available under s79 of the Motor Accidents Act 1989 (see Nicholson v Nicholson (1994) 35 NSWLR 308). There will be no award of interest on the increase in non-economic loss. URJ RAYNER v McQUEEN (Stein JA) 5 ¢ Past loss of wages The court awarded the appellant $22,746.68 for past loss of earnings. This is challenged on the basis that his Honour erred in his calculation of what the appellant would have earned if uninjured. At the trial the appellant had urged the adoption of his earnings at Vizy Pack Pty Ltd ($367.53 nett per week in 1989) where he was employed between 1988 and 1990, less some allowance for subsequent periods of unemployment. The respondent contended that it was more appropriate to average the last four financial years' earnings of the appellant and this produced a result of $218.20 nett per week less actual earnings. It is the submission on behalf of the appellant that his Honour erred in adopting the figure of $218.20 per week because this was distorted from a true average over the 4 years in three ways. First, it took no account of the fact that the appellant was involved in a failed self-employed farming venture between September 1986 and June 1987 (9 months) and earned no income during that period. Second, in February 1990 the appellant ceased employment to go on a lengthy holiday in Queensland. The financial year ended 30 June 1980 included 4-5 months of the extended holiday and thus distorted that year's normal earnings. Third, the court made no allowance for inflation of wages between 1989 and the hearing in 1995. It is submitted by the appellant's counsel that his earnings of $367.52 from his employment with Vizy Pack in 1989 is a realistic starting point. Together with the general increase in average weekly earnings between 1989 and 1995, it is contended that a figure of around $550.00 per week is appropriate. It follows, in the appellant's submission, that average earnings over the period from the date of the injury to the trial (if uninjured) would be approximately $450 per week nett. This figure would produce a nett loss of past wages of $71,622 after deducting actual post-injury earnings of $26,028. However, during the hearing of the appeal Mr Hislop appeared to concede that it would be proper to reduce the $450 per week by 10% to allow for periods of unemployment between 1990 and the trial had the appellant not been injured. This would bring the claim back to $405 per week. Senior counsel for the respondent, Dr A Morrison SC submits that the court's assessment of past loss of earnings was within its discretion. I think that there is merit in the submission that his Honour erred in utilising the figure of $218.20 per week. It was in reality a distorted figure and made no allowance for the general increase in earnings between 1990 and 1995. The starting point should be his Honour's findings that the plaintiff had obtained experience as a machinist and was usually in full-time employment, apart from the period of 12 months immediately preceding the accident which was partly a lengthy holiday in Queensland and partly unemployment following the vacation. It seems to me that if one is to average 4 years of earnings (which may be a legitimate way to establish past earnings) then each year has to be reasonably typical or appropriate adjustments made. The 1986-87 year was by no means a full year of normal income. Indeed, it appears to have represented only around 3 months of earnings because the appellant spent between September 1986 and June 1987 working in his unsuccessful farming venture and derived no income during that time. Indeed, if one assumes his nett earnings in that financial year of $6,664.70 were in respect of the first 3 months, this would produce an average earning in that period of around $500 nett per week. 6 UNREPORTED JUDGMENTS As to the last financial year utilised by his Honour (1989-90), it is apparent that the appellant left Vizy Pack in February 1990 to embark on an extended holiday in Queensland. It is also apparent that he was still on holiday as at 30 June 1990. Therefore, this financial year can give no true indication of average weekly nett earnings when the year's wages is divided by 52 weeks. It would be more realistic to divide it by say 30 weeks, which produces an average nett weekly wage of around $425. In my opinion, his Honour erred in adopting the average of 208 weeks of nett earnings for the four financial years between 1 July 1986 and 30 June 1990 without making adjustments. The figures were distorted in the manner I have indicated. A much better starting point was his earnings with Vizy Pack. The appellant was employed by it for a full two year period between February 1988 and February 1990, when he resigned to go on holiday in Queensland. His average weekly nett earnings in 1989 with Vizy Pack was $367.52. To this some adjustment needs to be made for the general increasing wages since 1989 and I accept Mr Hislop's submission that over the period between the accident and the trial this would lead to an average nett weekly loss of $450. An adjustment needs of course to be made for possible periods of unemployment and the vicissitudes, but not the subsequent changes in career which was essentially related to the appellant's disability. Arriving at a proper percentage reduction is not easy because the evidence relating to unemployment is unclear. There is a blur between the Queensland holiday and the period of unemployment before the accident which is impossible to resolve. It does appear, however, that there was likely to be not insignificant periods of unemployment for the appellant, even if the accident had not occurred. In the end I have come to the conclusion that a realistic deduction would be 20%. This produces a weekly net average wage loss between the accident and the trial of $360 per week. From this is to be deducted the actual earnings of the appellant in the period. There also appears to be a 2 week agreed wage loss of $1121.20 between 4 and 18 February 1989. I would leave it to the parties to calculate past wage loss and bring in short minutes of order giving effect to the judgment. ¢ Future loss of earnings The trial judge allowed $55,000 for future economic loss. This was made up of $47,500 for future loss of earnings and $7,500 for the economic loss associated with the 'high probability' that the appellant would require operations to his shoulder and knee in his 50's. His Honour described the sum of $47,500 as a 'cushion for both the optimistic and pessimistic aspects of the plaintiff's future having regard to the disabilities which he suffers.' It is the submission of the appellant that his Honour's award grossly undervalues the loss. On behalf of the respondent it is submitted that the sum was not wholly disproportionate to the circumstances. Mr Hislop suggests that a proper and reasonable figure for future economic loss is $125,000. He readily concedes that there is nothing scientific in his figure. It is merely a calculation based on total unemployment from the trial to age 65 (around $500,000 loss) divided by four to arrive at a reasonable balancing of all factors. For reasons which I will explain I have concluded that $47,500 (awarded by his Honour) is a sum wholly disproportionate to the appellant's circumstances. URJ RAYNER v McQUEEN (Stein JA) 7 Prior to the accident, the appellant for the very most part, worked in physically demanding activities. His capacity to do work of this nature has been permanently lost by reason of his disabilities resulting from the accident, see Dr Burgess. The appellant's condition will deteriorate and by the time he is in his 40's he will be in serious difficulties, particularly in relation to the shoulder disability. He will likely require two periods off work in his 50's for operations to his knee and shoulder. So here was a man whose pre-injury employment in manual tasks is denied to him, a person usually in full time employment but with a prognosis of deterioration into the future. Fortunately the appellant was motivated to commence a catering course in 1991 and obtained employment as a casual kitchen hand. Subsequently he obtained employment with the Galloping Grape restaurant at Lithgow. In November 1992 he commenced a 4 year apprenticeship as a chef. His employer, Mr Roger Penrose, gave evidence. He said that the restaurant was aware of the appellant's accident when he was employed. There were duties which the appellant needed assistance to perform, eg stacking stock in the cool room. Mr Penrose had observed the appellant's problem with his shoulder and the need for him to rest in such circumstances. Also he needed to sit down to rest his right knee on occasions. The employer indicated that he was unsure if he could continue the appellant's employment after his apprenticeship was finished. Mr Penrose was not cross-examined on this evidence. Dr Burgess, whose opinions were essentially accepted by his Honour, stated that the appellant would not be able to continue in his present type of employment beyond the age of 50. If the appellant loses his employment as a chef once his apprenticeship is complete, or at any other time thereafter, it is apparent that his prospects of obtaining further employment in the catering field are likely to be limited, given his continuing disabilities and gloomy prognosis. It is also probable that work as a chef - which involves standing for long periods, as well as lifting from time to time - will be difficult for the appellant, and increasingly so as he moves into his 40's. On top of this is the evidence accepted by bis Honour that there is a high probability that the appellant will require two operations in his 50's - a knee replacement and a shoulder procedure. Indeed it is probable, according to Dr Burgess, that the shoulder procedure will be required when the appellant is in his 40's. His Honour found that notwithstanding the appellant's retraining 'he is nevertheless likely to experience difficulty, both in continuing his occupation, and possibly also in continuing gainful employment to 65 years.' To allow a 'cushion' of $47,500 for future economic loss seems to me, in all of the circumstances, to be wholly disproportionate to, and to significantly underestimate, the appellant's loss. Just what is an appropriate figure to compensate the appellant for his future economic loss? One must bear in mind the appellant's relative youth at the time of the injuries; his incapacity for manual work (which was his previous employment); the questionable prospects of his continuing further employment in the catering industry given his continuing disabilities and likely future deterioration; the need for two periods off work in his 50's to undergo not insignificant operations; as well as the risk that his ability to derive income from employment could be lost at any time. 8 UNREPORTED JUDGMENTS When these factors are balanced with all of the other relevant circumstances, the vicissitudes and imponderables, I arrive at the conclusion that $100,000 is an appropriate allowance for future economic loss. This includes an allowance of $7,500 made by his Honour for the future operations. Summary of conclusions To enable the parties to bring in short minutes it is convenient to summarise my conclusions. 1. The finding of contributory negligence should stand. 2. The 20% assessment for contributory negligence should stand. 3. Damages for non-economic loss should be recalculated to set aside his Honour's finding of 25% of a most extreme case and substitute 40% of a most extreme case. 4. Damages for past economic loss of $22,746.18 found by his Honour should be set aside and the loss recalculated on the basis of $360 per week for the period between the accident and trial, less the agreed actual earnings. 5. By consent, the out-of-pocket expenses to be adjusted upwards to $8,462.65. 6. Damages for future economic loss of $55,000 found by his Honour should be set aside and the sum of $100,000 be substituted. 7. The appeal should be allowed with costs. 8. The respondent to have a certificate under the Suitors' Fund Act 1951 if so entitled. The parties are requested to bring in short minutes so that a verdict and judgment can be entered for the appellant in substitution for the one entered at the, trial. Beazley JA I agree with Stein JA. Mason P I agree with Stein JA. (1) Appeal allowed. (2) Parties directed to bring in Short Minutes of Order to give effect to the judgment of the Court. (3) The respondent to pay the appellant's costs of the appeal. (4) The respondent to have a certificate under the Suitor's Fund Act if qualified. Counsel for Appellant: J D Hislop QC Solicitors for Appellant: Higgins & Higgins Counsel for Respondent: Dr A Morrison SC and R Royle Solicitors for Respondent: Stewart, Cuddy & Mockler