New South Wales Court of Appeal CITATION : RNJ SICAME (AUST) PTY LTD v MOSS [2001] NSWCA 213 FILE NUMBER(S) : CA 40838/00 HEARING DATE(S) : 14 June 2001 JUDGMENT DATE : 14 June 2001 PARTIES : RNJ SICAME (AUST) PTY LTD v Andrew David John MOSS JUDGMENT OF : Mason P at 1; Stein JA at 29 LOWER COURT JURISDICTION : District Court LOWER COURT 84/99 FILE NUMBER(S) : LOWER COURT Williams J JUDICIAL OFFICER : COUNSEL : Appellant: J D Hislop QC/ H Kelly Defendant: T K Tobin QC/ A Black SOLICITORS : Appellant: Price Waterhouse Coopers Legal Respondent: Mark Mulock & Co CATCHWORDS : Damages - appeal - workplace injury - whether trial judge erred in assessment - past economic loss - future economic loss - no error in award. (ND) DECISION : Appeal dismissed with costs. THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40838/00 MASON P STEIN JA Thursday 14 June 2001 RNJ SICAME (AUST) PTY LTD v Andrew David John MOSS JUDGMENT 1 MASON P: In January 1995 the respondent was injured at work when he slipped on an oily floor. He injured his lower back. He was twenty two at the time. 2 At a trial in the District Court on 5 October 2000 the respondent established negligence and recovered a verdict of $568,732.15. Included in the components of the verdict were an award of $96,609 for past economic loss and an award of $304,000 for future economic loss. 3 The appellant contends that the trial judge's assessment of damages for impairment of past and future earning capacity is erroneous and requires correction, with consequential adjustment to the allowances for superannuation and interest. 4 The trial judge, Williams DCJ, reviewed the medical evidence. He accepted that the respondent suffered permanent disability of his back in the order of twenty two to twenty five per cent and permanent disabilities of a lesser percentage in both legs. Among the medical opinions accepted by his Honour was that of Dr Scougall who reported in March 1997: His back lesion has now stabilised. I believe that his present level of impairment of function is likely to remain unchanged in the future. Even if he does have further treatment, it is very doubtful I believe that this treatment is likely to lessen his present level of impairment of function. Since he is able to do semi-sedentary work, I believe he can stand and walk for a reasonable length of time but has a definite restriction on activities requiring bending and lifting, I believe he has a 20% permanent impairment of his back. On the information available to me, he had a 0% impairment of his back prior to the episode that occurred at work on 10 January 1995. Since also he has bilateral leg pain of about equal intensity in each leg and since that leg pain contributes to his level of impairment of function, I believe that he has a 10% loss of the efficient use of each leg, at or above the knee, deemed to include below the knee. 5 The respondent gave evidence that he experienced pain daily of varying intensity but normally getting worse during the day. The award for non-economic loss was assessed at forty six per cent of a most serious case. 6 The only oral evidence at trial was that of the respondent, who gave evidence of his pre- and post-injury work experience. That experience was fairly extensive and obviously impressed the trial judge. The respondent left school at age fifteen. His literacy is very limited and he lived in a semi-rural area. Between ages fifteen and twenty two he had a wide range of jobs, including labouring, brickie's labourer, making house frames, working in a furniture factory, gyprocking, welding, engineering and mechanical work. He had also spent time working on escalators, on a dairy farm and as a roof insulator. At the time of his injury, the respondent's job with the appellant, a manufacturer of electrical conductors, was that of a leading hand. In the respondent's words: I was to make sure everyone else was doing their job properly and to make sure of the quality of the products that were coming out and to keep the machines running. 7 The respondent was earning $400 per week net, this sum including overtime every day. 8 Since his injury, the respondent made several attempts to return to gainful employment. He worked with the appellant for a time on light or restricted duties. He tried his hand as a painter. He sought a vocational assessment report from CRS Australia in May 1999. The findings of that report included the following: Mr Moss disclosed that he is in constant pain and uses a tennes machine on a regular basis. After the injury Mr Moss reported that he attended physiotherapy, however this increased the pain and he no longer attends. Mr Moss reported that his left leg feels "dead" and he experiences a constant pain. He reported that the right leg is not as severe as the left and he experiences more sensation in the right leg. Mr Moss reported that he experiences sharp pains in his back if he bends or lifts over 5 kilogram. Mr Moss reported that before the injury he was physically active participating in rock climbing and bush walking. Now he reported that he is able to walk short distances on flat terrain, needs to shift his position when sitting and needs to stretch after 30 minutes sitting. Mr Moss reported that he is able to stand stationary for about 10 minutes, longer if he is able to alter his position and relieve the pressure on his back. Mr Moss stated that he has a driver's licence, however he cannot afford to run a vehicle and borrows his parents when he needs to attend appointments as the jolting on public transport causes severe pain in his back and he cannot keep his balance if required to stand. Mr Moss reported that his car had been a manual without power steering, which he found difficult to steer. Mr Moss reported that he does not like driving in traffic and does not have the patience to drive to the city or in high traffic areas. Mr Moss reported that he is not on medication as the Naprosyn caused stomach problems. If the pain is severe and the tennes machine has not impacted on the pain Mr Moss reported that he takes panadol. Mr Moss disclosed that he became depressed, was bored and was feeling suicidal after leaving his job and not being able to maintain any of the jobs he obtained for more than a week due to the pain and lack of physical capacity. Mr Moss claimed that he had worked hard and lost everything and felt that there was no point in living. Mr Moss stated that he had been living with his girlfriend, who left after he was out of work and he moved back in with his parents as he could not afford accommodation. Mr Moss said that he did not seek any assistance for his depression but pulled himself together and reported that he is now focussed on gaining employment and getting on with his life. Mr Moss said that he feels like a burden on his parents as he is no longer self-sufficient. While he reported that he is aware of his limitations Mr Moss presented as very motivated to obtain employment. 9 The rehabilitation counsellor concluded by saying that after discussions with Mr Moss and in view of Mr Moss's work experience, educational background, interests, physical abilities and stated work preferences, she thought the following occupations were considered best: (a) motor vehicle and related products sales person and (b) courier. 10 The respondent gave evidence about his own assessment of his capacity to deal with each type of employment thus suggested. He indicated areas in which he thought he would be able to handle the job and areas where problems would arise in consequence of the back pain (see Black 25- 27). 11 The trial judge did not overlook this evidence. The findings he made in relation to the respondent's willingness to work and capacity for work included the following: There is a general concession that the plaintiff is unfit for work involving lengthy standing, bending, carrying or lifting. The plaintiff concedes that there is work that he can do, however, given his problems with literacy and the fact that he lives in a country area of course the problems of finding appropriate employment are going to be extremely difficult. The plaintiff I am satisfied has a good worth ethic. I am satisfied that his inability to work is caused by the pain that he experiences as a result of this accident. There may well be a mild psychological component but I agree with Dr Bodel that that component is not out of keeping with the type of injury that he has…. … I am satisfied that the plaintiff has done all in his ability to return to work in the intervening period since this accident. Indeed he has probably endeavoured to undertake jobs that he probably should not have undertaken, in particular the recent plumbing work that he did. What that does indicate of course is that he had a capacity, uninjured, to do that sort of work. … In the rural arena with the injuries that he has and the disabilities that he has which I am satisfied are permanent, the prospects of finding employment of a suitable nature are far more significantly restricted than they might be in the city. It might be fair enough for Dr Govind to say he could find a job as a ticket seller. I do not know if there is too many ticket selling jobs around in country towns. And whilst his literacy may cause some problems in a job such as being a parts interpreter, say at a car spare parts establishment, he has indicated in evidence that he has managed to achieve sufficient literacy in that special area to overcome general problems of reading, in that he is able to recognise various motor vehicle words that appear in newspapers like the Trading Post for example. But of course I think it is fairly common knowledge for anyone who has got a car, that persons who are working in spare parts establishments are required not only to serve across the counter, but to go and get the parts and bring them to the counter and when they are not doing that, to remove items from shelves, put other material back on shelves and they are all activities that he is going to have difficulty with from now on. 12 The reference to "recent plumbing work" relates to a period of employment at Clearwater Plumbing in early 2000. The respondent worked for ten weeks earning an average of $820 net per week. He came to stop work in the following circumstances: Well, the amount of pain that I was in, I wasn't, I wasn't sleeping properly. Come Thursday or Friday I was nearly falling asleep at the wheel. I was in tears nearly every other day and it was just - the mental frustration was getting too much, I just had to - I couldn't cope with it, I had to leave. 13 The trial judge was clearly entitled to view this employment as indicative of the range of skills, including the adaptive skills, of the respondent. In his Honour's words, the plumbing employment showed that the respondent had the capacity uninjured to do that sort of work. It follows that it was also evidence of the respondent's earning capacity uninjured. 14 Before us, the appellant submitted that this evidence was out of kilter with the evidence of the respondent's pre-injury earnings. So it was, but it does not follow that it lacked probative force. After all, the injury occurred in 1995. It is inconceivable that pay levels for the respondent's particular job at the time of injury would not have moved upwards. But the greatest significance of the Clearwater Plumbing employment is that when taken with the other evidence it clearly entitled the trial judge to conclude that the respondent's demonstrated earning capacity was not pegged down by his actual earning experience pre-1995. 15 The respondent took this Court to cases which established that evidence showing that an accident caused obvious disabilities putting a plaintiff out of his or her existing employment may cast on the defendant an evidentiary burden of showing the availability of suitable and remunerative alternative employment (see Linsell v Robson [1976] 1 NSWLR 249 at 254-5, Thomas v O'Shea (1989) AustTortsR ¶80-251 at pp 68,701-2.) 16 I agree that these principles were brought into play in the present case but I do not think it is ultimately necessary to resort to them because the respondent's case stands on its own feet. In particular (1) the respondent established to the trial judge's satisfaction his inability to return to his pre-injury employment or any alternative employment involving lengthy standing, bending, carrying or lifting; (2) the respondent's very limited formal education and his near illiteracy, coupled with the added difficulty of non-city dwellers in obtaining employment, exacerbated the problem of exploiting for reward the respondent's residual capacity; (3) the trial judge was satisfied that the respondent had a good work ethic, a finding well supported by his pre- and post-injury work experience, the CRS assessment and the evidence generally of the respondent. 17 The trial judge assessed past economic loss on the basis that the respondent had sought and obtained work as best he was able in the five years preceding the trial. His actual earnings were deducted from a sum calculated by reference to the rate of $380 per week; $380 per week was slightly less than his average rate of pay at the time of the accident. His Honour said this as regards future economic loss: On the question of future economic loss, there is no doubt the plaintiff does have a capacity for work. It is his incapacity for work that has to be compensated. The plaintiff's net income in 1995 was some $380. He was able to earn $820 net per week this year with the plumbing company until his back condition forced him to give that work up. The plaintiff through counsel claims the sum of $400 net per week by way of future economic loss. Mr Kelly argues that that is excessive in the circumstances and that a future economic loss of between $100 and $150 net per week should be applied. There is no basis upon which that figure is put to me, because Mr Kelly indicated that or submitted that the plaintiff has a retained capacity of work of at least $400 per week now. That may in fact be correct, in which case if he was able to earn $820 net per week earlier this year, his economic loss would be some $400 net per week. Bearing in mind the fact that the net loss per week if he was working in his old employment as a full time worker would have been in the vicinity of $400 per week and given the fact that it has been demonstrated that he was able to attain a position earning him some $800 net per week earlier this year, I cannot see any problem about allowing the plaintiff the sum of $400 net per week in respect of future economic loss. There does not appear to be any suggestion that the type of work or the nature of the work that he was engaged in as an assistant in a plumbing company was unusual or contained some unusual factor in the way that the salary was made up. In my view, that figure is not unreasonable. The proposed figure for future economic loss takes into account a fifteen per cent deduction for vicissitudes…. 18 The appellant directed its principal attack to the award for the future. In particular, the appellant challenged the use of $820 per week as a benchmark. The appellant submitted that the ten weeks period of employment in 2000 was not indicative or representative of the respondent's earning capacity uninjured. The appellant also submitted that the assessment erred in ignoring the respondent's retained earning capacity. 19 I would reject the latter point. The trial judge did not assess damages on the basis that the respondent had no current or likely future earning capacity. Earlier in the judgment he had recorded that the plaintiff conceded that there was work he could do. (I have already set out that passage as par 11 above.) 20 What his Honour did, and what he was entitled to do in my view, was to take account of the nature and extent of the respondent's disabilities and the practical likelihood of the respondent getting steady remunerative employment, especially in the country. His Honour did not overlook the respondent's natural abilities or his capacity for future education (see especially Red 26). 21 The appellant cited passages in Norris v Blake (No 2) (1997) 41 NSWLR 49 esp at 63F, 65 and 73. 22 In my view, no error in the trial judge has been demonstrated. The passage from Norris at 65 in the judgment of Clark JA reads: Historically, courts throughout Australia, when assessing compensation for the impairment of earning capacity of a plaintiff who was in regular employment prior to the accident and whose disability precludes him or her from performing any gainful work in the future, have approached the assessment by first determining what earnings the plaintiff was likely to have earned in the future and then to make such adjustment, either up or down, as is appropriate in the circumstances of the case to take account of the vicissitudes. In making that adjustment the courts have had regard to evidence suggesting possible changes to the plaintiff's career, such as promotion or redundancy, as well as the risks of life which are common to all. 23 This passage does not preclude a court from having regard to events occurring after the accident if they cast light on the issue of lost earning capacity. In recording this, I am not suggesting that senior counsel for the appellant suggested otherwise. In the present case, two events are significant: (1) the lapse of five years from the date of the injury and (2) the respondent's actual work experience in 2000. The former has relevance because it is simply fallacious to assume that the wages of a comparable employee working in the respondent's very job would not have moved upwards between 1995 and 2000. No evidence was led at trial to indicate by how much, but it must have been to some degree. I am inclined to think that the respondent is correct in suggesting that the evidentiary onus lay on the appellant in this regard, in light of the remarks of Glass JA in Linsell but it is unnecessary to determine that issue. 24 As to the second matter, the respondent's actual work experience in 2000 was most significant. The fact that nothing but physical disability stemming from the tort drove the respondent from this job makes it a most apt indicator of the monetary extent of the respondent's uninjured working capacity at date of trial. 25 In my view, the essential fallacy of the appellant's attack on the judgment is the assumption that his Honour was bound to start from an earning capacity of $400 per week, being the respondent's actual earnings back in 1995. The trial judge's reasoning on the issue of future economic loss appears slightly infelicitous in expression, no doubt reflective of the fact that judgment was given ex tempore on the day of trial, but the broad thrust is clear and in my view the reasoning and order disclosed no appealable error. 26 The challenges in relation to past economic loss and the conventional allowance of fifteen per cent for vicissitudes must also be rejected. His Honour's selection of $380 per week as the base rate for past loss is $20 per week lower than the respondent's actual earning rate at the time of trial. Whether or not it was the case that the respondent worked for only four and a half to five years in the seven years prior to the accident as recorded by Dr Scougall is of little weight, given his age, family situation, apparent motivation and actual earnings at the time of the accident. His Honour was entitled to accept the medical evidence as to the non-impact of the respondent's pre-existent back condition upon the trauma experienced to date of trial. Whether or not any congenital problem might have surfaced later in his life is speculative on the evidence. The respondent seems to have been blessed with greater than normal drive, adaptability and work ethic, so his prospects for favourable contingencies might well have been seen as cancelling out any concerns stemming from the pre-existing or congenital back problems. I am not persuaded that there was any error in this regard. 27 Taken overall, the award may have been generous but that does not establish any appealable error. 28 I would dismiss the appeal with costs. 29 STEIN JA: I agree with the President. 30 MASON P: That is the order of the Court ********** DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.