GIUSTI v TAYLOR SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL MASON P, SHELLER JA and FITZGERALD AJA 8 September 1998, 2 October 1998 [1998] NSWCA 99 NEGLIGENCE — damages — economic loss — costs — offer of compromise made The appellant had brought proceedings to recover damages for injuries she claimed to have received when being treated by the respondent dentist for a grinding and clicking jaw and headaches. In March 1993 the respondent had fitted a device known as a Clark Twin or Bayer block to relieve pressure on the appellant's temporomandibular joints. The appellant said that this form of treatment caused her to suffer an increase in pain. The respondent gave evidence that he had noted improvement in her condition and persisted with the treatment whilst he felt there was improvement. On or about 12 October 1993 the use of the device was discontinued and was replaced by a device called a Bionator. The respondent had written to a to a specialist in March 1994 and had continued to treat the appellant until the end of August 1994. The trial Judge held that the defendant had been negligent in not seeking advice from a specialist and persisting with treatment when it appeared to have doubtful efficacy. His Honour awarded general damages of $10,000 and $380 out of pocket expenses for the last 6 months of the appellant's treatment but did not make an award of interest. The trial Judge also ordered the appellant to pay the respondent's costs from 27 October 1996, at which time the respondent had made an offer of compromise in the sum of $12,000, to the time of judgment. The respondent conceded that the trial Judge should have made an award of interest of $654. Therefore, the appellant appealed against the trial Judge's decision on the following bases: (i) the trial judge erred in not making an award in favour of the appellant for economic loss; (ii) that the award of damages was manifestly inadequate on the basis that the trial Judge's finding of the period of negligence was too short; and (iii) the trial Judge erred in not exercising his discretion under Pt39A r25 of the District Court Rules to order that the appellant be awarded costs from 28 October onwards despite the offer of compromise due to the special nature of the proceedings. Held: 1. On the evidence it was open to the trial Judge to find that the appellant had not suffered any economic loss. 2. The appellant failed to show that the trial Judge's finding of the period of negligence being the last six months of treatment was too short. The award of $10,000 damages for the closed period of negligence from March to August 1994 was within the range of properly exercised jurisdiction. 3. Given the offer of compromise, there were no exceptional circumstances which should have caused the trial Judge to exercise his discretion under Pt39A 125 of the District Court Rules to make an order that the appellant be awarded costs from 28 October 1996. Houatchanthara v P Bednarczyk (unreported) Court of Appeal, 14 October 1996 and Morgan v Johnson (unreported) Court of Appeal, 8 September 1998. Authorities: Houatchanthara v P Bednarczyk (unreported) Court of Appeal, 14 October 1996 Morgan v Johnson (unreported) Court of Appeal, 8 September 1998 Mason P I agree with Sheller JA. 2 UNREPORTED JUDGMENTS Sheller JA The plaintiff, Deborah Giusti, has appealed from a decision of Judge Shadbolt given on 9 May 1997 in proceedings brought by her to recover damages for injuries she claimed to have received when being treated by the defendant and respondent, Andrew Taylor, who is a dentist. The appellant was referred to the respondent in 1992 by her general practitioner, Dr Fracchia. She was suffering from grinding and clicking in her jaw and headaches. After taking a history, the respondent explained the treatment which he thought appropriate and in March 1993 fitted an appliance known as a Clark Twin or Bayer Block. This was intended to relieve pressure on the appellant's temporomandibular joints. According to the appellant, soon after the appliance was fitted the pain increased and despite her reports to the respondent to this effect, he persisted in the treatment. She said that the increase in pain radiated into the right side of her head and neck, affecting her domestic and work life. The respondent gave her a course of massages, perhaps three or four, but the pain nevertheless increased to a point where she was in despair. The uncontested evidence, though Judge Shadbolt did not refer to this, was that on or about 12 October 1993 the appliance was discontinued and the respondent fitted another functional appliance described as a Bionator. The respondent continued to treat the appellant until the end of August 1994 after which time he did not see her. The respondent gave a different account. He said that when the appellant attended his surgery he noted from time to time improvements in her condition as she reported them and because he felt there was improvement he persisted with the treatment. A number of experts were called to give evidence and various opinions were given about whether the treatment given by Dr Taylor was appropriate and whether the respondent should have referred the appellant to other dental specialists with more expertise than his own. One of the experts was an orthodontist, Professor Hawkins, who made three reports and gave oral evidence. In his reasons for judgment, Judge Shadbolt referred to what he described as an internecine war raging between some, at least, of the expert witnesses. His Honour said: "None of this helped very much nor did the plaintiff's exaggeration, her assertion of words spoken by the defendant's specialist and her denial of anything damaging to her interest in her history as they reported it, assist her cause nor did the patent exaggeration of her father and his bizarre behaviour in court assist very much either. Despite these difficulties, the Court must decide the case on the evidence presented. It is perhaps easier to start at the end rather [than] at the beginning. I cannot be satisfied on balance that there is any irreversible damage to the plaintiff. Two experts assert that on radiological evidence there is none and the plaintiff's expert merely says that (there) might have been." Judge Shadbolt was satisfied on balance that the treatment the respondent afforded the appellant was appropriate. He regarded the respondent as qualified both academically and by experience to commence the treatment and observed that if he accepted, as he did, the respondent's clinical notes, he had good reason to continue what he was doing. However, his Honour did not think the respondent's notes conveyed the total picture. He said: URJ GIUSTI v TAYLOR (Sheller JA) 3 "T accept the plaintiff did phone him, how often I do not know, to complain of increasing pain and I am also satisfied that at some stage, Dr Taylor realised that the plaintiff represented a difficult case. He said as much in his letter of referral to Dr Hook." The latter to Dr Hook was dated 7 March 1994 and became significant in his Honour's decision. The reasons for judgment proceeded: "Professor Hawkins expressed a view in his report that Dr Taylor should have sought advice from a specialist. A more prudent general dentist would then have sought advice from others with more learning and experience in the precise field. To persist with treatment when it appeared to have a doubtful efficacy was in my view falling short of the proper professional advice and care which a patient should expect. It is in this area and this area only that the negligence could be sustained and its origin does not lie in carelessness. Quite the opposite; more an excess of zeal, of optimism in the face of contradictory indications." Judge Shadbolt then came to the assessment of damages and reiterated that he had trouble in accepting the plaintiff's evidence in its entirety. However, he accepted that she had suffered: "some increase in pain during the course of the treatment which has abated since then. Had Dr Taylor sought advice earlier, she might well have been spared that. If the difficulty had been observed at the time, that is 10" [sic] March [1994] when he wrote to Dr Hook who really gave little support for continued treatment as he was not of the view that she was troubled by that for which she was then being treated, then he should have ceased his treatment then and there, leaving her at liberty to seek treatment from an appropriately qualified orthodontist or prosthodontist. The following six months of pain appeared to be that for which she must be compensated when an unsuccessful procedure was continued." His Honour gave the plaintiff $10,000 general damages for pain and suffering and $380 for out of pockets, that is to say one-third of the cost of Dr Taylor's treatment. He did not give any out of pocket expenses for subsequent treatment which, his Honour said, would have been undertaken in any event. The total verdict was $10,380. His Honour added no interest. On 29 October 1996 the solicitor for the respondent had given notice of an offer of compromise in the sum of $12,000 in accordance with Pt19A of the District Court Rules open for acceptance before the expiration of twenty-eight days after the offer was made. This offer not having been accepted and the appellant having obtained a less favourable verdict, his Honour ordered the appellant to pay the respondent's costs from 27 [sic] October to the time of judgment. With the respondent's consent the appellant filed a further amended notice of appeal in which there were four numbered grounds. Ground 2 (a) was not pressed. Ground 2 (b) related to the trial Judge's failure to award interest on the general damages and out of pocket expenses awarded. The respondent accepted that such interest should have been awarded. If the appeal otherwise fails, it is agreed that it should be allowed to the extent of altering the amount of the verdict by a sum of the $654 interest on general damages and out of pocket expenses. The first ground of appeal was that his Honour erred in not making an award in favour of the appellant for any economic loss. In his reasons for judgment, Judge Shadbolt made no mention of economic loss. In her amended statement of particulars under Pt12 r4A, the appellant claimed that at the time of her injuries she was employed as an assistant accountant with Butterworths Publishing. As a result of her disability since February 1993 she had lost approximately 11.6 days 4 UNREPORTED JUDGMENTS of work for which she had taken sick leave, which otherwise would have been reimbursed to her as wages. She sought reimbursement of her sick pay entitlement in the sum of $1,109 calculated at $95 net per day. These particulars were supported by her evidence. Asked how much time she had off work because of the pain she suffered after seeing Dr Taylor, the appellant had said that to the best of her knowledge she would have used all eight sick days allocated for each year over the time of the treatment. "In total it would have been probably about twelve days over the two years or the eighteen months". This was the only evidence about economic loss and it was not challenged in cross-examination. Standing alone it did not demonstrate that she lost any money or was out of pocket as the result of her days off work. On this evidence it was open to trial Judge to find that she had suffered no financial loss. Indeed, there was no evidence upon which he could have found anything else. It is, therefore, beside the point to consider whether or not his Honour overlooked the claim for economic loss. This ground of appeal must be rejected. Ground 3 was that the trial Judge had erred in not taking into account the entirety of the medical evidence when awarding the appellant damages and that the award of general damages was manifestly inadequate. Most of the appellant's argument was directed to this ground of appeal. Judge Shadbolt's finding was that to persist with treatment when it appeared to have doubtful efficacy was to fall short of the proper professional advice and care which a patient should expect. It was in this area and this area only that the negligence could be sustained and its origin did not lie in carelessness, more an excess of zeal, of optimism in the face of contrary indications. The respondent did not cross-appeal against this finding of negligence. The trial Judge enlarged upon it when he came to the assessment of damages and said that if the difficulty, that is to say the increase in pain, had been observed on 10 [sic] March when the respondent wrote to Dr Hook "then" the respondent should have ceased his treatment "then and there". The following six months was the period for which the appellant must be compensated during the time that the unsuccessful procedure was continued. Reading these parts of the judgment together I am satisfied that his Honour intended to convey that the respondent was in breach of his duty of care to the appellant in persisting with the treatment for the period from 10 March 1994 to the end of August 1994. Dr Hook's letter was written on 7 March 1994. It is a little difficult to see why it was only at that time that persistence with the treatment became negligent. The answer appears to be that at that stage Dr Taylor realised that the appellant represented a difficult case. Up until then, the Judge was satisfied that the treatment Dr Taylor afforded the appellant was appropriate. The appellant, in claiming that the damages awarded for non-economic loss were inadequate, challenged this conclusion and in reliance upon the reports of Professor Hawkins submitted that the trial Judge should have found that the respondent's treatment of the appellant was negligent from its inception or at least from a date no later than two months thereafter in May 1993. Judge Shadbolt said in his judgment that Professor Hawkins expressed the view in his report that Dr Taylor should have sought advice from a specialist. According to Professor Hawkins' report of 1 April 1996 "At the very least, he should have suggested a referral to a dental specialist with more expertise than him in the first place." Earlier in his report Professor Hawkins had said that he felt that Dr Taylor's treatment plan was defective. Professor Hawkins could not see what purpose the attempted tooth movement was to achieve. However, URJ GIUSTI v TAYLOR (Sheller JA) 5 Professor Hawkins' report of 1 April 1996 was qualified, to some extent, by his oral evidence. In his report he said that the treatment undertaken by use of the Clark Bayer Block was unusual. The appliances were used to correct an antero-posterior discrepancy in a growing individual. The appellant was twenty-three at the time. However, having recently read Dr Clark's book, Professor Hawkins took the view in his oral evidence that the appliance could be used for oral facial pain treatment and further, if it was succeeding, there was no reason to cease. However, the use of this appliance had been discontinued in October 1993. No part of the findings was directed to the type or quality of treatment Dr Taylor provided after that date. Reading the reasons for judgment, Tam not wholly satisfied that his Honour appreciated that the Clark Bayer Blocks were not being used after October 1993. Clearly, his Honour did not accept Professor Hawkins' statement that Dr Taylor should have sought advice from a specialist "in the first place". He seemed to have considered that the treatment was appropriate and the respondent qualified to commence it. What then was the significance of March 1994? In his report Professor Hawkins, after saying that Dr Taylor should have suggested to a referral to a dental specialist with more expertise than him in the first place continued: "Having said that, I feel that he acted responsibly within a reasonable length of time by referring the patient to Dr Peter Hook." Professor Hawkins, whom the respondent called, was not cross-examined by the appellant on this statement and did not elsewhere qualify it. While it is not entirely clear, this evidence was, I think, sufficient for the Judge not to have been satisfied that the respondent's treatment of the appellant up to March 1994 was negligent. A survey of the clinical notes of the respondent for the period up to that time shows that some improvement was reported to the respondent. Having carefully considered these matters I am not persuaded that it is open to this Court to interfere with the trial Judge's finding that the period of negligent treatment by the respondent was limited to the six months from March to August 1994. The appellant's claim that the general damages were manifestly inadequate depended upon showing that the period of negligence chosen by his Honour was too short. In my opinion, this challenge to the trial Judge's conclusion fails. The appellant claimed that the proper range of damages was from $20,000 to $30,000. Iam quite satisfied that for the closed period of negligence from March to August 1994 the award of $10,000 was within the range of a properly exercised discretion. In my opinion, this ground of appeal fails. The fourth ground of appeal was that the trial Judge erred in not exercising his discretion pursuant to Pt39A 125 of the District Court Rules to order that the plaintiff be awarded costs from 28 October 1996 onwards in view of the special nature of the proceedings. Pt39A r25(6), in the form it took when the offer was made, provided that where an offer was made by a defendant and not accepted by the plaintiff and the plaintiff obtained a judgment on the claim which was not more favourable to the plaintiff than the terms of the offer, then unless the Court otherwise ordered, the plaintiff should be entitled to an order against the defendant for the plaintiff's costs in respect of the claim up to and including the day the offer was made on a party and party basis and the defendant should be entitled to an order against the plaintiff for the defendant's costs in respect of the claim thereafter on a party and party basis. This Court has said on more than one occasion that it will only be in exceptional cases that the Court, exercising its discretion properly, will "otherwise" order. See V Houatchanthara v P 6 UNREPORTED JUDGMENTS Bednarczyk (unreported) Court of Appeal, 14 October 1996 and most recently Morgan v Johnson (unreported) Court of Appeal, 8 September 1998 at 5 and following. The appellant urged that the Court should have otherwise have ordered because the case involved complicated expert evidence the effect of which could not easily be prejudged and the amount of the verdict, particularly when interest was added, was only marginally below the amount the respondent offered. In my opinion, the appellant had the initial hurdle of showing that the trial Judge erred in the exercise of his discretion. This she failed to do. Simply to say that particular matters might have led another Judge or this Court to a different conclusion is not sufficient. Furthermore, for reasons given in the decisions to which I have referred, the matters relied upon do not, in my opinion, amount to exceptional circumstances. This ground of appeal also fails. It will be necessary to allow the appeal so as to adjust the judgment to take account of interest. However, the appellant otherwise failed it its appeal. The appellant could and should have taken up the failure to award interest with the trial Judge when he gave judgment. Accordingly, I think that the appellant should pay the respondent's costs of the appeal. I would propose the following orders: 1. Appeal allowed; 2. Set aside the judgment and verdict for the plaintiff in the sum of $10,380 and substitute therefor a judgment and verdict for $11,034; 3. Otherwise confirm the orders made by Judge Shadbolt; 4. The appellant to pay the respondent's costs of the appeal. Fitzgerald AJA The circumstances giving rise to this appeal are set out in the reasons for judgment of Sheller JA. As his Honour has pointed out, the ground of appeal to which most argument was directed concerned the adequacy of the general damages awarded to the appellant. That issue in turn depended upon the period in respect of which the appellant was entitled to damages. The trial judge found that the material period was from March to August 1994. The first period extended from 1992 when the appellant was referred to the respondent by her general practitioner, Dr Fracchia, to March 1993, when the respondent fitted the Clark Twin or Bayer Block. There is no suggestion that the respondent was negligent in that period or in the subsequent period ending on about 12 October 1993, when the Block was removed. The respondent then fitted another functional appliance described as a Bionator to the appellant. Thereafter, he continued to treat the appellant until the end of August 1994. During that period, in March 1994, the respondent sought advice from a more qualified practitioner, Dr Hook, who provided no useful assistance. A little later that month, Dr Fracchia referred the appellant to another specialist, Dr Norman. Following advice from Dr Norman, the respondent adopted a different treatment which, according to the appellant, failed to give effect to Dr Norman's advice. When the appellant was again seen by Dr Norman in May 1994, he referred her to another specialist, Dr Teasdale. In June 1994, the appellant was referred by the respondent to another specialist, Dr Ravich. In August 1994, the appellant consulted another specialist, Dr Short and, later that month, the respondent ceased treating the appellant. URJ GIUSTI v TAYLOR (Fitzgerald AJA) 7 The appellant subsequently received other treatment from other specialists. The only finding of negligence made by the trial judge against the respondent was that he persisted with treatment when it appeared to have doubtful efficacy. His Honour declined to criticise this behaviour as careless. He found it: "Quite the opposite; more an excess of zeal, of optimism in the face of contrary indications." No hint was given at that point concerning when the respondent should have ceased to "... persist with treatment [which] does appear to have had doubtful efficacy...". The only other material passage of the judgment followed a statement by the trial judge that the assessment of damages was difficult. His Honour said: "T do accept... that [the appellant] had suffered some increase in pain during the course of the treatment which has been abated since then. Had [the respondent] sought advice earlier, she might well have been spared that. If the difficulty had been observed at the time, that is 10 March [1994] when he wrote to Dr Hook who really gave very little support for continued treatment as he was not of the view that she was troubled by that for which she was then being treated, and he should have ceased his treatment then and there, leaving her at liberty to seek treatment from an appropriate qualified orthodontist or prosthodontist. The following 6 months of pain appeared to be that for which she must be compensated when and unsuccessful procedure was continued." Thave difficulty following the trial judge's process of reasoning, and am unsure whether his Honour correctly understood the evidence. However, it was not a ground of appeal that the reasons for judgment failed to discharge the trial judge's judicial function of providing adequate reasons. The appellant accepted the burden of demonstrating that higher damages should have been awarded. To do so, she would have had to show that the respondent's negligence related to a longer period. She failed to do so. Indeed, on one view of the trial judge's reasons, they provide little, if any, support for a conclusion that the respondent was negligent in treating the appellant as he did between March and August 1994. However, the respondent did not challenge that finding. Subject to those observations, I agree with the reasons for judgment of Sheller JA. I also agree with the orders proposed by his Honour. 1. Appeal allowed; 2. Set aside the judgment and verdict for the plaintiff in the sum of $10,380 and substitute therefor a judgment and verdict for $11,034; 3. Otherwise confirm the orders made by Judge Shadbolt; 4. The appellant to pay the respondent's costs of the appeal. Counsel for the appellant: T J Morahan Solicitors for the appellant: Sommerville & Co Counsel for the respondent: P R Capelin QC/P Russell Solicitors for the respondent: Abbott Tout