ROBERTS v SMITH SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL PRIESTLEY and POWELL JJA and FITZGERALD AJA 9 November 1998, 19 November 1998 [1998] NSWCA 189 PERSONAL injury — industrial accident — quantum appeal — findings of trial judge insufficient and inadequate — new trial ordered Priestley JA I agree with Fitzgerald AJA. Powell JA I agree with Fitzgerald AJA. Fitzgerald AJA This is a quantum appeal from the District Court. The appellant, the plaintiff below, exaggerated his claim and was an unreliable witness. As happens all too often in such circumstances, in the resultant confusion the trial judge made findings which were insufficient and inadequate. In my opinion, a new trial is unavoidable. The Plaintiff was aged 43 years when he was injured on 27 May 1995. He had an excellent work record, and, at the date of the accident, had been a salesman at Wayne Byrne's Discounts, a retailer, since 1988. The appellant claimed to have received injuries to his buttock, lower back and neck in the accident, but the trial judge found that the appellant did not receive a neck injury and was not satisfied that his other physical injuries prevented him from being "fit for the job of an electrical and associated goods salesman"; ie, (it seems) at the date of trial. It is not clear to what extent that conclusion was related to his Honour's doubt, notwithstanding the evidence, concerning "the extent to which the [appellant's] pre-accident work required lifting...". It is not in dispute that the appellant was summarily dismissed on 13 October 1995, less than 5 months after the accident. The letter of dismissal, which was in the form of a reference, was in the following terms: "Mr William Roberts was employed by our company for 10 years from October 1985 to October 1995. Even though Bill was never given a title he virtually managed the Electrical Sales part of our Business for 10 years. Bill's main asset was in his special sales knowledge of electrical appliances, but he also took on the responsibility of stock ordering, banking, and all other duties involved in a retail store. Bill's honesty and reliability could never be questioned and I would recommend him for any future sales position he may seek. Due to a car accident some four months ago Bill has been on light duties and unable to perform the job required of him. Unfortunately due to these circumstances we are unable to continue his employment in this manner as the position he was employed in requires certain physical duties. I wish Bill all the best for the future and would not hesitate in re-employing him under different circumstances." The trial judge erroneously stated that, when the appellant's employer terminated his employment in October 1995, he did so "without giving a reason". The appellant was apparently dismissed for the reason given by Mr Byrne in his letter of 13 October 1995, which was confirmed in his oral evidence at trial. 2 UNREPORTED JUDGMENTS Despite other criticisms made of the appellant, it is appropriate for present purposes to proceed on the basis that his inability "to perform the job required of him" when he was dismissed on 13 October 1995 was attributable to injuries which he had received in the accident on 27 May 1995. Nonetheless, it seems curious that, in the period between 1 July 1995 and the date of his dismissal, the appellant received a bonus commission, in addition to his wage, which had not previously been paid to him. The appellant had an "eggshell personality", in that he had a predisposition to Bipolar Affective Disorder. He gave evidence that his peremptory dismissal, which he described as merely being handed the envelope in which Mr Byrne's letter of 13 October 1995 was contained, caused him great emotional distress and stress associated with anger and loss of self esteem. He unsuccessfully sought employment at Grace Bros on the following day, but thereafter made no attempt to find other work. Other matters contributed to his difficulties. For example, the trial judge found that "possibly or probably" the appellant had an "alcohol or drug related problem pre-accident", and that, in late 1995, he discovered that his son was a heroin addict under a sentence of periodic detention. It will be necessary to return to these findings. In January 1996, the appellant suffered an episode of Major Depression followed by a Hypomanic Episode leading to his hospitalisation in Waratah House at Campbelltown Hospital. He was still undergoing psychiatric treatment and physiotherapy for his physical injuries when the action was tried in early July 1997. Judgment was given on 17 July that year. The trial judge found that the appellant's average net weekly earning at the time of the accident was $517.55. While that was correct, his employer's records indicated that the appellant was earning approximately $597 net per week at the time when he was dismissed. The higher amount was earned from 1 July to 13 October 1995, and included an amount for commission. The total net earnings lost by the appellant between his dismissal and judgment, calculated on the basis that his earnings, including commission, at the time when he was dismissed would otherwise have continued, was $54,485. The trial judge awarded the appellant $15,000 for past economic loss, without any indication of how he arrived at that figure. His Honour also awarded the appellant the whole of his medication expenses for that period ($2,500), but only half (approximately) of his other "out of pocket" expenses, including physiotherapist's fees; the amount awarded was $3,550. The appellant sought increases in the amounts awarded for past economic loss and "out-of-pocket" expenses, and in other components of the damages awarded by the trial judge, including his award of $25,000 as a "buffer" in respect of future economic loss and the amounts awarded for future expenses, including physiotherapy, psychiatry and other medical expenses, and "non-economic loss". In the course of his judgment, the trial judge said: "The plaintiff was presented to me as someone who still has a major psychotic illness. He did seem to become a little confused and had memory lapses but generally throughout his evidence, he was very lucid in his expression, coped with the cross-examination well and seemed to me to be 'very much on the ball'." His Honour also found that a brief video film of the appellant taken whilst shopping in January 1997 established two things. He said: URJ ROBERTS v SMITH (Fitzgerald AJA) 3 "The first is, - when coupled with some cross-examination - it establishes that the Plaintiff is able to walk for fairly considerable distances without a problem (contrary to his assertions in evidence). The second is that... it shows a man who does not indicate any disability at all. Certainly he did not run or over exert himself and he had no difficulty in rescuing from a fall his young son who seemed to trip when walking on the footpath." His Honour was satisfied "that upon completion of this litigation the plaintiff will return to work and that his depressive illness will ease after treatment". No other explanation was provided concerning how the amount of the "buffer" for future economic loss, or the amounts for future expenses or non-economic loss were arrived at. The following passage from the trial judge's reasons for judgment was central to his Honour's decision. He said: "Defendant's Counsel asks me to find that the Plaintiff has failed to establish a causal nexus between the motor accident and the psychological problems. He correctly says that the Plaintiff has the onus in that respect but it seems to me that I must find that the motor accident was a contributing factor. Other contributing factors - on the evidence - seem to me to be the son's drug problem which caused the Plaintiff to take some extreme action and, possibly or probably, some alcohol or drug related problem pre-accident.... .. I am simply not satisfied - on the balance of probabilities - as to the substance of the Plaintiff's disabilities, and I am not satisfied that the accident is the sole contributor." The respondent's argument initially accepted the finding that the accident was a contributing factor to the appellant's "psychological problems", but, part-way through his oral submissions in this Court, the respondent sought leave to file a notice contending that the trial judge erred in that finding. The application was understandably opposed by the appellant. At its broadest, the respondent's argument appeared to be that the chain of causation apparently linking the appellant's physical injuries from his accident to his inability to perform his work satisfactorily, then to his dismissal and then to his Major Depression and Hypomanic Episode was broken because the appellant's emotional distress upon his dismissal was not related to the fact of his dismissal but to the manner in which he was dismissed. That argument, which is founded upon a highly selective reading of the evidence, is without merit. I take the trial judge to have meant, as he was entitled to find on the evidence, that the appellant's injuries from the accident led to his dismissal and the fact of his dismissal materially contributed to his subsequent Major Depression and Hypomanic Episode. According to established principle, in those circumstances the accident was a material cause of the appellant's "psychological problems". At its next level, the respondent's argument appeared to be that, because the accident was not the "sole contributor" to the appellant's "psychological problems", the trial judge correctly reduced the appellant's damages by reference to the other factors which contributed to those problems, irrespective of the nature of those factors. That seems to have been the course followed by his Honour, who unfortunately gave little indication of the factors which he had in mind or the respective proportions in which they contributed to the appellant's psychological problems. Although what was encompassed in this aspect of the respondent's case is unclear, it appeared to have two aspects. One was related to the proportional contribution each factor made to the appellant's "psychological problems". The 4 UNREPORTED JUDGMENTS other was related to the possibility that the appellant would have suffered the same "psychological problems" - either at the same time or some later time - even if he had not been injured and dismissed. According to the hospital records, when the appellant was admitted to Waratah House his son said that the appellant "had been using heroin and marijuana up until late December 1995". Reference was also made to a brother with paranoid schizophrenia and to the appellant "holding his son as a hostage just prior to admission to the hospital...". Other relationship problems were also referred to by the appellant's son and former wife. They told of a history of heavy drinking and heavy use of heroin and marijuana by the appellant, who was described as physically and verbally abusive. At the trial, the appellant and his defacto wife denied these allegations, and the appellant's son gave evidence in which he admitted that he was a heroin addict and explained that he had wanted to "get back at his father". Further, he wanted his father out the way so that he would be free to indulge his heroin addiction. In this Court, the appellant also suggested that his work history was inconsistent with a pattern of substance abuse. A submission was made for the appellant that the hospital records were inadmissible under s69 of the Evidence Act, 1995 or ought not to have been received in the exercise of the Court's discretion under s135. The submission related to s69 was based on the premise that the hospital records were "prepared... for or in contemplation of or in connection with, an Australian... proceeding"!, namely, the "scheduling" of the appellant. However, there was no elaboration, and it was conceded that the point was not taken below. In the circumstances, this Court should proceed on the footing that the evidence was correctly admitted. The trial judge made no findings concerning whether the appellant's own conduct was a cause of his "psychological problems" or, if it was, whether his material conduct was itself a consequence of his accident.2 Nor, of course, was there any finding concerning the extent, if any, to which conduct of the appellant for which the accident was not responsible contributed to his psychological problems. Nor was there a finding on the respondent's contention that the appellant might have had his "psychological problems" even if he had not been injured and dismissed. It is accordingly impossible for this Court to discern whether or not the damages assessed by his Honour were correct and, if incorrect, to reassess the amount to which the appellant is entitled. As earlier stated, there must be a retrial. Again for reasons which are insufficiently explained, the trial judge ordered each party to pay his own costs. The respondent had made an offer which was close to, but less than, the amount awarded to the appellant. Further, there had been an arbitration, at which the appellant had not called all his witnesses and, following which, he had changed his approach somewhat. And the trial judge made findings adverse to the appellant's reliability as a witness. Other matters referred to by each of the parties need not be repeated. It is unnecessary to decide what course would be followed with respect to costs if the damages award were not being set aside. Since there must be a new trial, I consider that all orders below should be set aside, and the costs of the first trial reserved to the judge who conducts the next trial. 1. Evidence Act 1995, subs69(3)(a) 2. cf The Commonwealth v McLean (1996) 41 NSWLR 389, 407-411 URJ ROBERTS v SMITH (Fitzgerald AJA) 5 In summary, the orders which I would make are the following: 1. Appeal allowed, with costs. 2. Damages awarded below set aside. 3. Retrial as to damages ordered. 5 4. Costs of first trial reserved to judge at retrial. 5. Respondent to have a Certificate under the Suitors' Fund Act if otherwise qualified. 1. Appeal allowed, with costs. 10 2. Damages awarded below set aside. 3. Retrial as to damages ordered. 4. Costs of first trial reserved to judge at retrial. 5. Respondent to have a Certificate under the Suitors' Fund Act if otherwise qualified.Counsel for the appellant: S Norton Solicitors for the appellant: Brydens 20 Counsel for the respondent: D Hooke Solicitors for the respondent: Ferguson Holtz3040