Fowler & Anor v Garcia [1999] NSWCA 119

New South Wales Court of Appeal CITATION : Fowler & Anor v Garcia [1999] NSWCA 119 FILE NUMBER(S) : CA 40453/98 HEARING DATE(S) : 19 February 1999 JUDGMENT DATE : 6 May 1999

PARTIES : Gregory John Fowler and Larry Warren Bates v Robert James Garcia JUDGMENT OF : Meagher JA at 1; Stein JA at 24; Austin J at 25

LOWER COURT JURISDICTION : Supreme Court LOWER COURT FILE NUMBER(S) : 10513/90 LOWER COURT JUDICIAL OFFICER : Dowd J

COUNSEL : Appellant/Cross respondents: P.E. Blackett Respondent/Cross appellant: P. Semmler QC SOLICITORS : Appellant/Cross respondents: Bartier Perry Respondent/Cross appellant: Turner Freeman CATCHWORDS : Negligence - motor vehicle accident - quantum - non-economic loss assessment of most extreme case - calculation of interest pursuant s.73 Motor Accidents Act. ACTS CITED : Motor Accidents Act, 1988 DECISION : Appeal allowed; cross appeal allowed.; Appellant to pay costs of cross appeal, no order as to costs of appeal.

- 9 - IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA: 40453/98 CORAM: MEAGHER JA STEIN JA AUSTIN AJA

Thursday 6 May 1999. Gregory John FOWLER v Robert James GARCIA

JUDGMENT

1 MEAGHER JA: The plaintiff, Mr Garcia, sustained severe injury in a motor vehicle accident on 3 December 1988. At the time he was a United States longshoreman visiting Sydney on vacation. His injuries were very severe; in fact, they occupy about five typed pages; they included the loss of an eye. 2 Dowd J found that the accident was caused by the negligence of the driver, Mr Bates, the second defendant. His Honour also found that the plaintiff was guilty of contributory negligence to the extent of 10%. Neither finding was challenged. 3 His Honour brought in a verdict of $1,777,948 in the plaintiff's favour. It was made up of the following items: "1.Non-economic loss $125,000 2.Griffiths v Kirkmeyer $10,608 3.Past out of Pocket expenses $98,219 4.Future out of pocket expenses $69,195 5.Past economic loss $350,480 6.Future economic loss $1,321,996 Total $1,975,498 Less 10% contributory negligence $1,777,048 Less credit for payments made by defendants $ 7,004- $1,770,044" 4 In this appeal the defendant Mr Bates seeks to challenge items 5 and 6 in that list. In the plaintiff's cross-appeal, item 1 is challenged. His Honour's decision not to award interest is also challenged in the cross-appeal. 5 By way of background, it should be noted that the plaintiff was a longshoreman. He always wanted to be one, and still does. His father was one, and so was his grandfather. The evidence was the there were two main types of longshoremen: ordinary longshoremen and crane-drivers, the latter being more generously remunerated than the former. In each type there were two subgroups, casual employees and "steady" employees. The former being employed from time to time, and the latter having permanent jobs; the latter subgroup were more handsomely remunerated that the former. 6 His Honour was very impressed by the plaintiff's testimony, and believed him on nearly every point. In particular, he found that if the plaintiff had not been injured he would have become a crane driver at the earliest possible time, and a "steady" crane driver at that. He also found that the plaintiff was highly intelligent as well as highly motivated. There obviously cannot be any contest about these findings. 7 Without wishing to cast aspersions on anyone, the course which the hearing of the case took was out of the ordinary, and took an unfortunate form. His Honour heard the case from 17 October 1994, 2 November 1994, and then adjourned it. Judgment emerged two and one half years later, on 11 July 1997. Even then, it was a judgment of an interim kind, mainly on liability, although to some extent discussed the relevant principles applicable to quantum. It was followed by a second judgment a year later, on 10 June 1998, when the plaintiff's verdict was announced. The issue of costs is still being litigated. 8 In his Honour's first judgment, leave was granted to the parties to re-open the case so as to adduce evidence on two, and only two, points: a) what were the plaintiff's actual earnings during 1995 and 1996 (the two years which had elapsed since the first judgment), and b) then converting US dollars into Australian dollars. 9 The defendant prior to 11 July 1997 led no evidence on the question of quantum. 10 The defendant tried to re-open the whole case on the resumed hearing, but his Honour did not countenance this, and kept the defendant to the two issues I have referred to. He tried again before this Court, but in my view should suffer the same fate. The litigation is already unnecessarily tedious and protracted. 11 As I have said, the defendant/appellant challenged the figure of past economic loss reached by his Honour, viz. $350,480. However, in the course of the hearing of the appeal, that challenge was abandoned (except in one respect, to which I shall return later). 12 The appellant's challenge to his Honour's figure for future economic loss ($1,321,996) was not abandoned. But, in order to evaluate the challenge, one must first ascertain how his Honour reached that figure. First, the loss to be measured was the difference between the plaintiff's present actual earnings (i.e the standard rate for a longshoreman) and the amount which he would have been earning uninjured as a crane driver, a position to which he would have progressed by 1 January 1995. Secondly, his actual earnings as a longshoreman were presently $1,298 per week. Thirdly, his earnings as a crane driver would have been 80% more than $1,298, i.e. $2,337 per week, thus yielding a current weekly loss of $1,039. Fourthly, his Honour found that he probably would have worked till he was 70 i.e. 37.33 further years. Fifthly, his Honour calculated that $1,039 over 37.33 years, discounted on the 5% tables, yielded $931,152. Sixthly, deducting 15% for vicissitudes, that figure becomes $791,479. All the above figures were calculated in US dollars, so finally, converting US$791,479 into A$, one reached the figure of $1,321,996. 13 The crucial step in this process is the step which I have labelled "thirdly". It was attacked by a variety of sophisticated arguments by learned counsel for the appellants, Mr Blackett. But the plain fact, as learned senior counsel for the respondent, Mr Semmler SC, pointed out, is that the plaintiff's expert witness, a Mr Arian, who clearly impressed his Honour, gave evidence that a crane driver's earnings were 1.8 times that of the standard rate for a longshoreman. Moreover, ironically, this also accords with the evidence filed on behalf of the defendant: see the written statement of Mr Krieger. 14 Subject to one thing, therefore, I would not disturb the figures at which his Honour arrived. 15 The matter to which I have referred is the date of the commencement of the crane-driving. His Honour said: 16 "I find on the evidence not only of the plaintiff but otherwise available to the Court, that the plaintiff would have progressed, in terms of his employment, to the level of a crane driver by 1 January 1995." 17 That date must be wrong. Both parties agreed with that proposition. The correct date should be 1 January 1996 or 1 January 1997. I think the former date is to be preferred, because the evidence was that a really focused worker would be able to accelerate his transition to crane-driving. One year's income must therefore be deducted from $1,321,996. To do this, one takes the weekly figure of $1039, multiplies it by 45, discounts the result by 15% and then converts that figure from US$ to A$. I make this amount $66,380. 18 It follows that in my view, subject to the matter referred to in the previous paragraph, the appeal should be dismissed. 19 On the cross-appeal, the first ground is that his Honour in awarding non-economic loss should have awarded a sum equal to 80% of a most extreme case, i.e ($200,000) instead of 50% (i.e $125,000). I agree with this. No mistake of law was made, but when one considers that the plaintiff suffered life threatening injuries and permanent disabilities, including in particular his loss of vision in the right eye, loss of the sense of smell and taste, significant orthopaedic injury, cosmetic disfigurement, depression, anxiety and consequent alcoholism, 50% seems to me almost ridiculously slight. 20 I would also be disposed to allow interest on past economic earnings, under s.73 of the Motor Accidents Act The highest offer made by the defendant was $290,000 plus costs on 12 July 1994. That offer seems to me to have been risible. At that date sufficient facts were known to the defendant to make it realize that a huge verdict would be available to the plaintiff. Section 73(4)(a)(iv) of the Act says: "the defendant has made an offer of settlement, the amount of all damages of any kind awarded by the court (without the addition of interest) is more than 20% higher than the highest amount offered by the defendant and the highest amount is unreasonable having regard to the information available to the defendant when the offer was made." 21 Section 73(4)(b) provides: "The highest amount offered by the defendant is not unreasonable if, when the offer was made, the defendant was not able to make a reasonable assessment of the plaintiff's full entitlement to all damages of any kind." 22 His Honour found that the offer was "unreasonable" within s.73, but not within s.74. I simply cannot follow this. In my view, it was unreasonable within each section of the Act and that gives the plaintiff an extra $105,862. What is "unreasonable" within s.73(4)(a) is also "unreasonable" within s.73(4)(b), and vice versa. 23 It follows that in my view the following orders should be made: 1)The appeal and the cross-appeal should be allowed. 2)The verdict below should be set aside, 3)In lieu thereof verdict for the respondent of $1,880,982 be substituted; 4)The appellant should pay the costs of the cross-appeal, and there should be no order as to costs of the appeal. 24 STEIN JA: I agree with Meagher JA. 25 AUSTIN AJA: I have read the reasons for judgment prepared by Meagher JA. I agree with his reasons and the orders which he proposes.