ABI GROUP LTD v LOGUCH SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CLARKE and HANDLEY JJA, and GILES AJA 19 and 21 November 1996, 10 February 1997 [1997] NSWCA 5 DAMAGES — assessment of common law damages for hearing loss — causation. WORKERS' COMPENSATION — assessment of common law damages for hearing loss — Workers Compensation Act 1987 (NSW) s151G(4) — Workers Compensation (Benefits) Amendment Act 1989 (NSW). EVIDENCE — failure to call evidence on hearing loss — Jones v Dunkel. EVIDENCE — admission of new evidence on appeal — Supreme Court Act 1970 (NSW) s75A(8) — not appropriate for Court to guess where precise evidence would be available at a retrial. The plaintiff, who was aged 48, was employed by the appellant between 1981 and 8 December 1989. He made a claim for damages for deafness caused by exposure to noise in his employment prior to 4 pm on 30 June 1987 when common law rights were abolished by the Workers Compensation Act 1987 (NSW). Common law rights were retrospectively re-introduced by the Workers Compensation (Benefits) Amendment Act 1989 (NSW), but no claim was made by the plaintiff upon this basis. The evidence before the trial Judge was that the plaintiff had sustained approximately 3% hearing loss prior to commencing work for the appellant, and also suffered further hearing loss after leaving employment with the appellant in 1989. His hearing loss was assessed in July and December 1992 at 15% and 15.1% respectively. The plaintiff was successful in obtaining general damages of $50,000, $10,000 for future economic loss and $6,000 for interest, on the basis that the appellant was liable for the whole of his hearing loss. There was also evidence available to the respondent of the results of hearing tests taken after he left the employment of the appellant, which he did not call. HELD - appeal allowed - per Handley JA (with whom Clarke JA and Giles AJA agreed) - (1) The appellant was not liable for the hearing loss occasioned prior to the commencement of employment with the appellant, or for the hearing loss occasioned after finishing employment with the appellant. However, the plaintiff was entitled to an award based on his vulnerability to additional hearing loss caused by his loss prior to 30 June 1987 whilst an employee of the appellant; (2) Increased vulnerability was not to be compensated as if it were an actual loss. See Neall v Watson (1960) 34 ALJR 364 at 367 and Hobbs v Costain Australia Ltd (unreported, 16 February 1995); (3) Since evidence had not been led by the plaintiff of the results of his hearing tests conducted by Saxonvale Alines, a Jones v Dunkel inference arose that this evidence would not have been favourable to his case; (4) The Court of Appeal has the power under s75A(8) of the Supreme Court Act 1970 (NSW) to admit fresh evidence, when an appeal is allowed, in aid of a reassessment rather than a new trial, but neither party had sought to prove the results of the plaintiff's hearing tests conducted by Saxonvale Mines and the preferable course was to remit the matter for retrial to the District Court. Clarke JA I agree with Handley JA. 2 UNREPORTED JUDGMENTS Handley JA The respondent, who was 48 at the date of trial in 1996, suffers from industrial deafness in both ears, which was assessed in July and December 1992 at 15% and 15.1% respectively. He was employed by the appellant from some date in 1981 until 8 December 1989, operating noisy earthmoving equipment without adequate hearing protection. Prior to 1981, he operated earthmoving equipment for other employers, also without adequate hearing protection, but his work then was not as noisy as it became when he was employed by the appellant. He worked for Saxonvale Mines from 11 December 1989 until the trial, operating noisy earthmoving equipment, but with reasonable hearing protection. The respondent sued the appellant in negligence for failing to take reasonable steps to protect him from hearing loss during his employment until 4 pm on 30 June 1987 when the Workers Compensation Act 1987 commenced and further common law rights were abolished. His claim for damages as pleaded included a claim for further damages suffered after that date "causally connected to the damage already sustained as at 30 June 1987 (paraS). An extension of the limitation period was granted. The trial judge found that the appellant had been negligent in failing to take reasonable care to protect the respondent's hearing and that finding has not been challenged. He also found that the respondent began to notice he was going deaf in 1983. By 1984 he was suffering from intermittent tinnitus. Mr Keck, an audiologist, considered that the respondent might well have suffered a 3% hearing loss in both ears prior to commencing work for the appellant in 1981. The respondent's hearing loss was not tested while he worked for the appellant, but was tested before he started work with Saxonvale on 11 December 1989 and thereafter was tested annually. The respondent did not prove the results of these hearing tests, but the appellant called no evidence. The respondent's affidavit in the proceedings for an extension of the period which was tendered at the trial disclosed that his hearing had been tested on or about 11 December 1989 before he entered the coal mining industry, and that he had then been informed that he had a noise induced hearing loss. The affidavit did not identify the party who arranged the test, the person who carried it out, or the result. There was no suggestion that the appellant knew before the trial that Saxonvale had arranged for the respondent to have this hearing test, or that it was the respondent's current employer. The respondent proved the results of hearing tests arranged by his solicitors on 28 July and 15 December 1992 with the results previously referred to. The judge held that the appellant was liable for the totality of the plaintiff's hearing loss as assessed in 1992 because: "... sensorineural deafness progresses arithmetically not geometrically. Every insult accumulates upon the last until human speech cannot be heard. Had ABI Group acted reasonably the diminution of his hearing capacity might well have been arrested and he might well have remained one of those whose hearing, whilst not perfect, is nonetheless functional. Since he has worked in the mines and taken precautions the only evidence before me is that two years apart two tests have shown almost the same deficiency. That consistency appears to indicate that, with care, ie is not, as he well might have been, getting much worse". The judge assessed general damages at $50,000 and awarded further sums of $10,000 for future economic loss and $6,000 for interest.. In my judgment these conclusions cannot be supported. The appellant could not possibly be liable for URJ ABI GROUP LTD v LOGUCH (Handley JA) 3 the 3% hearing loss in both ears that the plaintiff had suffered during earlier employments. The plaintiff suffered a further unquantified hearing loss during his employment with the appellant between 1 July 1987 and 8 December 1989. The appellant may have been liable for damages for this further loss under the amendments to the 1987 Act inserted by the Workers Compensation (Benefits) Amendment Act 1989, which retrospectively restored modified common law rights for injured workers with effect from 30 June 1987. The plaintiff made no claim to recover such damages, presumably because of the deductible threshold of $36,000 for non economic loss in s151G(4). The respondent's evidence indicated that his hearing continued to deteriorate while he was employed by Saxonvale. This was not likely to be due to aged induced hearing loss (presbycusis) which normally starts to,manifest itself about the age of 55. The appellant has therefore been ordered to pay $66,000 damages assessed for the whole of the respondent's deafness, although it was not liable for the 3% loss caused by previous employments, and was not legally liable for the unquantified loss which occurred during his employment with the appellant from 1 July 1987 to 8 December 1989 or thereafter while employed by Saxonvale. With respect the judge erred in awarding damages for the totality of the respondent's hearing loss when some of that loss had not been caused by the appellant, and it was not legally liable for all of the loss it had caused. There are further difficulties. The judge said that on the evidence before him two tests taken two years apart had shown almost the same hearing loss. In fact, the tests were taken less than 5 months apart on 28 July and 15 December 1992. Moreover the respondent failed to prove the results of his hearing test on 11 December 1989, and his annual tests thereafter arranged by Saxonvale. These failures, which were not explained, gave rise to a strong Jones v Dunkel inference that those tests would not have assisted the respondent's case that the appellant was legally responsible for the whole of his hearing loss. The appropriate inference, in my judgment, is that a significant part of the respondent's hearing loss occurred after 11 December 1989. In these circumstances the judge's assessment must be set aside. Both parties invited the Court to re-assess, but in my judgment that is not appropriate in this case. The Court has available unchallenged evidence that 3% of the respondent's loss occurred prior to his employment with the appellant, but it can only guess at how much of his loss was caused after his employment with the appellant ceased. In my judgment this Court should not construct a re-assessment of the respondent's damages on the basis of guesswork when it knows that precise evidence, which would eliminate the need for that guess, will be available in a new trial. Cf Willis v The Commonwealth (1946) 73 CLR 105 at 116 per Dixon J ("where facts are available they are to be preferred to prophecies'). The Court, having decided to set aside the assessment of the trial judge, may have been entitled under s75A(8) of the Supreme Court Act to receive in evidence a report of the respondent's hearing test on 11 December 1989 in aid of a re-assessment by this Court rather than a new trial - See Tamas v Streimer (CA, 10 July 1981, unreported, except in Ritchie's Supreme Court Procedure Vol 2, paral3,027, p8550). Neither party attempted to place that evidence before this Court. In any re-assessment the trial judge will also have the assistance provided by the decision of Mustill J in Thompson v Smiths Ship Repairers (North Shields) Ltd (1984) QB 405, which was not cited to the original dial judge, or to this Court, which has stood unchallenged in England since it was decided. 4 UNREPORTED JUDGMENTS The evidence established that noise induced hearing loss is permanent and incurable, and that available hearing aids are of little assistance. It also established that as such losses increase their consequences for the victim become progressively greater. Thus the 3% hearing loss, sustained by the respondent prior to his employment with the appellant, appeared to cause him no ill effects, although because of this loss further losses would have a greater impact. Age induced deafness will also cause further hearing losses which will have serious consequences for someone who is already suffering from significant noise induced deafness. Although Parliament abolished common law rights for the future as from 4 pm on 30 June 1987, and the respondent did not attempt to rely on any modified common law rights he may have had under the retrospective provisions of the 1989 Act, this does not mean that the damages in this case are limited to the effects, as at 30 June 1987, of the respondent's then hearing loss. That loss, to the extent that it was caused by the appellant, will have made the respondent more vulnerable to further losses due to industrial noise. The respondent is entitled to damages for that increased vulnerability in accordance with the principles established by Neall v Watson (1960) 34 ALJR 364 at 367, where the High Court in a joint judgment said: "\.. a defendant is liable only for the harm his negligence causes, not for harm later ensuing from the operation of a new and independent cause. If a man who is injured is thereby made more vulnerable to injury in the future that will count in assessing damages. But this does not mean that increased vulnerability is to be compensated as if it were an actual wounding. The loss of one eye increases the risk of total blindness, but it is not to be compensated as if it had caused the blindness that follows the loss of another eye by accident later'. The loss tortiously caused by the appellant will also have made the respondent more vulnerable to the effects of age induced deafness which as a result-will have a greater impact on him. The respondent is also entitled to damages for this added vulnerability. Counsel for the respondent relied on the decision of this Court in Hobbs v Costain Australia Ltd (unreported, 16 February 1995) to support the approach adopted by the trial judge'. Properly understood the decision does not do so. Cole JA, in a judgment concurred in by Kirby P and myself, said at p8: "The deleterious consequences to a worker of events occurring before that date (30 June 1987) may, of course, be reflected by a deteriorating condition in a worker's hearing after that date provided, as a matter of evidence, any deterioration can be causally linked to the events constituting the negligent acts prior to that date". That case decides that damages are recoverable for a plaintiff's increased vulnerability due to losses tortiously caused where the evidence supports an award on that basis. It does not support the view propounded for the respondent at the trial, and accepted by the trial judge in his assessment, that a pre-30 June 1987 tortfeasor is liable for all subsequent losses. The first trial miscarried on the issue of damages and a new trial of that issue must be ordered because the respondent failed to call available and relevant evidence, and because both parties failed to assist the judge with appropriate submissions as to the law. In these circumstances the respondent should have his costs of the issue of liability, but there should be no order as to the costs of either party on the issue of damages. However, because the issues were intermingled URJ ABI GROUP LTD v LOGUCH (Giles AJA) 5 and an order in that form would complicate any assessment, I would order that the respondent receive half his costs of the first trial. The orders I would propose are: (1) Appeal allowed with costs. (2) Judgment for the plaintiff for $66,000 plus costs including indemnity costs since 15 December 1995 set aside. (3) In lieu thereof judgment to be entered for the plaintiff for damages to be assessed and proceedings remitted to the District Court for that purpose. (4) The defendant to pay half the plaintiff's costs of the first trial. (5) The costs of the second trial to abide the order of the judge presiding at that trial. (6) The respondent to have a certificate under the Suitors' Fund Act. Giles AJA I agree with Handley JA. (1) Appeal allowed with costs. (2) Judgment for the plaintiff for $66,000 plus costs including indemnity costs since 15 December 1995 set aside. (3) In lieu thereof judgment to be entered for the plaintiff for damages to be assessed and proceedings remitted to the District Court for that purpose. (4) The defendant to pay half the plaintiff's costs of the first trial. (5) The costs of the second trial to abide the order of the judge presiding at that trial. (6) The respondent to have a certificate under the Suitors' Fund Act. Counsel for the appellant: M J McAuley Solicitors for the appellant: John Sharpe Counsel for the respondent: B S Robison Solicitors for the respondent: Maurice May & Co