New South Wales Court of Appeal CITATION : Southern Health Service & Ors. v. Smith [2001] NSWCA 369 FILE NUMBER(S) : CA 40365/00 HEARING DATE(S) : 6 June 2001 JUDGMENT DATE : 18 October 2000 Southern Health Service - first appellant Dr. Barbara Graham - second appellant PARTIES : Dr. G.J. Cocker - third appellant Dr. M. Hassan - fourth appellant Geoffrey Wayne Smith - respondent JUDGMENT OF : Powell JA at 1-15; Hodgson JA at 16-53; Greg James J at 54-67 LOWER COURT JURISDICTION : District Court LOWER COURT DC 5362/98 FILE NUMBER(S) : LOWER COURT Williams DCJ JUDICIAL OFFICER : COUNSEL : Mr. S. Walmsley SC for appellants Mr. M. Cranitch SC with Mr. G. Wilson for respondent SOLICITORS : Colin Biggers & Paisley, Sydney for appellants Nevill & Edwards, Sydney for respondent CATCHWORDS : TORT - Negligence - Damages - Appeal - Failure to allow for vicissitudes - Whether balanced by other errors - Whether new trial should be ordered. ND. DECISION : See par.53 of judgment IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40365/00 DC 5362/98 POWELL JA HODGSON JA GREG JAMES J Thursday 18th October 2001. SOUTHERN HEALTH SERVICE & ORS. V. SMITH Judgment 1 POWELL JA: As the essential facts which have given rise to this appeal are set out in the Judgment which has been prepared by Hodgson JA, which Judgment I have read in draft, it is not necessary for me to repeat them here. 2 I regret to say that I regard William DCJ's Judgments, insofar as they deal with the matters which have been debated on the hearing of the appeal, as unsatisfactory. Past Economic Loss 3 Australia Save that, in his first Judgment Williams DCJ recorded (RAB 54) that that loss "(had) been assessed in round figures at $6,0000.00", and, later (RAB 58), that that sum "(had) not been mathematically disputed", his Honour did not record his reasons for adopting that sum as the appropriate sum to be allowed. 4 The only evidence directed to past economic loss in Australia which was given on the hearing was as follows: a. the Respondent's evidence that, although continuing to work as a lodge liaison officer, he was not able to continue to work as a ski instructor in Australia; b. the Respondent's evidence that this caused a loss of $400.00 per week before tax; c. the Respondent's income tax assessment for the financial year 1996-1997 (Black AB 190) and a "Tax Calculation" for the financial year 1997-1998 (Black AB 186) which revealed a taxable income in the former year of $15,897.00 and in the latter year of $13,064.00, and tax assessed in the former year of $2,099.40 and tax calculated in the latter year of $1,532.80, a difference in the nett income after tax for those two years of $2,266.40. No figures for the financial year 1998-1999 or for the period from 1 July 1990 to the date of hearing were tendered. 5 This evidence, in my view, provided a very flimsy basis for an assessment of $6,000.00 for past economic loss. 6 United States In his second Judgment, Williams DCJ wrote (RAB 62): Past Economic Loss 97/97 USA Ski Season Averaging out the last 3 years prior to the operations, adding the component for tips, the nett economic loss for that year appears to be in the order of AUD$20,000.00 and I allow that amount." However, as, in the course of his Judgments, his Honour did not carry out any calculation to "average out" the Respondent's United States income – other than gratuities – in the three tax years prior to the operations – the United States tax year is a calendar year – although he did in his second Judgment calculate an average figure for gratuities (RAB 61-62) I find it quite impossible to understand how his Honour calculated the sum of $20,000.00. 7 The Respondent's United States tax returns – both Federal and State – for the tax years 1994, 1995 and 1996 – the accuracy of which returns is, to say the least, suspect – reveal the following – work related deductions not including the Respondent's costs of return air travel to the United States. Year Gross Income Work Related Deductions 1994 11981 1292 10689 1995 12967 1990 10977 1996 15343 ? ? If, as recorded by Williams DCJ in his Judgment, Federal tax in the United States is a flat 20%, this would suggest that, in those years the Respondent's income after tax was in the order of US$8551, US$8716 and something less than US$12274, respectively. Those figures, if converted at the rate – AUD$1.00:US$0.65 – adopted by his Honour would represent AUD$13,155, AUD$13,409 and something less than AUD$18,883, a total of something less than AUD$45,447 and an average of AUD$15,149 yearly. 8 If to the figure of AUD$15,149 thus produced one adds the "annualised income loss of $139.00 per week" calculated by Williams DCJ (RAB 61-62) as representing the value of gratuities, one obtains a figure of $22,377, which figure, of course, exceeds the amount allowed by his Honour for the past economic loss in the United States, a fact which casts more than a shadow of doubt over the validity of the whole exercise. Future Economic Loss 9 Australia There are several unsatisfactory features of this aspect of Williams DCJ's Judgment: a. although, in his first Judgment, Williams DCJ recorded (RAB 54-55) that " there (was) a claim for continuing economic loss of $138.00 for 15 weeks each year ", the amount of which claim he adopted before "annualising" it, he nowhere records the basis for calculating that amount, nor his reasons for adopting it; b. although recording (RAB 53) the Respondent's evidence that he would have remained a ski instructor all his life, and that a ski instructor at Perisher Valley had recently celebrated his 70th birthday, Williams DCJ did not – at least, did not expressly – record his acceptance of that evidence or express his view that, if things had been different, there would have been a reasonable prospect that the Respondent would have continued as a ski instructor until 70 years of age; far from his having done so, the choicer of the multipliers which he adopted for this purpose – but, curiously, not for the purpose of calculating United States future loss – would suggest that Williams DCJ thought it unlikely that the Respondent would have continued as a ski instructor beyond the age of 65 years; c. as Hodgson JA has noted, Williams DCJ did not – at least did not expressly – make any allowance – whether the conventional 15% or a higher percentage – for contingencies; the failure to deal with that aspect of the matter involved error on the part of his Honour, and the suggestion made by Mr. Cranitch, in the course of argument, that the multiplier adopted by Williams DCJ represented a discount of about 15% upon the multiplier which would have represented a loss calculated to age 70 years is not to the point. 10 United States In his first Judgment, Williams DCJ wrote (RAB 578) that "with reference to the taxation evidence, without gratuities, (he) would calculate the (Respondent's) future economic loss from activities in the USA on the basis of a nett income of about AUD$304 per week", while in his second Judgment he wrote (RAB 61) that "at page 28 (he) indicated the (Respondent) was entitled to a nett income of AUD$304.00. This (was) AUD$15,808.00 nett per annum for his losses in the US in the US where his gross income in Australian dollars would have been about $23,500.00 bearing in mind that the income (he had) to assess (was) his gross income after tax not the nett income after taxable deductions". 11 This is unsatisfactory for a number of reasons: a. as I have previously (para. 8 (above)) recorded, the Respondent's average nett yearly income after tax over 3 years in the United States was not AUD$15,808.00 but, at best, AUD$15,149.00; b. although the Respondent's Federal income tax return for the year 1996 records a "gross income" of US$15,343 that sum is made of "Wages salaries tips etc" of US$14,871 and "Taxable refunds, credits, or offsets of state and local income taxes"; c. the same return records "Itemised deductions" of US$10,891 made up of State income taxes of US$665, gifts to charities US$50 and unreimbursed employee expenses of US$10,483, a figure made up of "Travel expenses" of US$6778, "Business expenses" – which appear to be work related expenses – of US$1292 and "Meals and entertainment expenses" of US$1500; d. the same return, after recording "Exemptions" of US$2550 records a "Taxable Income" of US$1902; e. if one adopts the conversion rate adopted by Williams DCJ – AUD$1.00:US$0.65 – the Respondent's gross United States income was AUD$23605, while the nett income after tax of AUD$15808 which he accepted was US$10275. Allowing tax of US$0.20, the Respondent's taxable income would thus have been US$12844, a figure which cannot be reconciled with any of the figures which I have earlier recorded; f. nor is the position made any clearer if one has regard to the Respondent's Federal income tax return for the tax year 1998, a year in respect of which, if any claim for past economic loss was made, no damages were awarded. In that year the Respondent's gross income was US$13540 (US$20831), itemised deductions US$8894 (AUS$13683) and exemptions US$2700 (AUD$4154) leaving a taxable income of US$1946 ($AUD$2994). And to confuse the matter further, "expenses" were itemised as totalling US$9710 (AUD$14938) made up of "flight cost" US$2400, "rent cost" US$3460, "food cost" US$2100, "equipment cost" US$1500, "telephone and internet cost" US$140, "parking" US$100, and "health club dues" US$200. Even if one deducts only "rent cost" and "food cost" (US$5560-AUD$8554) one is left with a "nett income" before tax of US$7980 (AUD$12277) or $223.20 per week "annualised". 12 Quite apart from the fact that the multiplicand adopted by Williams DCJ is, to say the least, suspect, the multiplier adopted by his Honour – 665.2, or that appropriate for 16 years – is open to question. 13 While, in his first Judgment, his Honour (RAB 56) expressed the view that "realistically, in (his view) whilst (the Respondent) may do one or two more seasons at Vail … the pressure on him in regard to that source of income is such that he is unlikely to continue it for any appreciable period", the allowance of 16 years would seem to suggest that it was Williams DCJ's view that, in the ordinary course, it would have been improbable that the Respondent would have continued as a ski instructor beyond the age of 62 years, a view which cannot be reconciled with the view apparently taken by his Honour when calculating future Australian economic loss and one which cannot be reconciled with the Respondent's evidence as to his intention to work as a ski instructor for the rest of his life. I have been unable to discover in Williams DCJ's Judgment any basis for reconciling this apparent inconsistency. Conclusion 14 Although, during the course of the hearing of the appeal, I had hoped (T.3.25) that, although it seemed to me that the trial had miscarried – because one could not work out, on the basis of supportable evidence, how Williams DCJ had calculated the amount of the damages which he awarded – it might be possible for this Court to calculate, for itself, the appropriate amount of damages, in the event I have regrettably concluded that, as his Honour's Judgment is, in my view, fundamentally flawed, it is not possible for this Court to avoid the matter being remitted to the District Court for the new trial limited to damages. Orders 15 I propose the following Orders: 1. ORDER that the appeal be upheld. 2. ORDER that the verdict found by Williams DCJ and the Judgment entered pursuant thereto be set aside. 3. ORDER that the proceedings be remitted to the District Court for a new trial limited to damages. 4. ORDER that the Respondent pay the Appellant's costs of the appeal but that, if qualified, he have a certificate under the Suitors Fund Act. 5. ORDER that the costs of the first trial abide the determination of the Judge on the retrial. 16 HODGSON JA: In October 1996, the respondent underwent radical surgery to deal with cancer associated with a lump in his neck, and this was followed by radiotherapy in December 1996 and January 1997. His life and earning capacity were substantially affected. He brought proceedings against the appellants, claiming that they should have diagnosed the cancer in about October 1995, and that, had they done so, it would have been successfully treated by far less invasive and detrimental procedures. Judge Williams awarded him damages of $595,456.48. 17 Before this Court, the appellants challenged certain aspects of that award. 18 The damages included $130,000.00 for general damages, $5,100.00 interest on past general damages, $75,000.00 for future dental care, $17,500.00 for other future medical expenses, $6,000.00 for past economic loss in Australia, $7,406.48 for past out-of-pocket expenses, and $3,000.00 superannuation loss. These amounts, totalling $244,006.48, are not challenged. 19 The aspects of the damages award that are challenged on appeal are $31,364.00 awarded for future economic loss in Australia, $20,000.00 awarded for past economic loss in the USA, $5,413.00 interest on past economic loss, and $294,682.00 awarded for future economic loss in the USA. BACKGROUND AND PRIMARY JUDGE'S DECISION 20 The respondent was born on 2nd May 1995. In 1974, he set up business with two others as a panel beater and smash repairer. The business was successful, but the respondent left it in 1979 to devote himself to skiing. He continued to do some panel beating work; and from 1984, he ran a panel beating business in Queensland in the summer months, while in the winter months he managed a ski lodge at Perisher Valley. 21 In 1986, he obtained full certification as a ski instructor. In 1990, his panel beating business wound up, and thereafter he worked during the summer months as a ski instructor at Vail in the USA, while in the winter months he was employed by Perisher Blue. 22 In 1993, he ceased to be a lodge manager at Perisher Valley, and thereafter was employed as a lodge liaison officer, in which position he was able to spend approximately four to five hours per day as a ski instructor. He continued to go to Vail each summer as a ski instructor. He also exercised his panel beating skills by purchasing cars, doing them up, and selling them. 23 Dealing with economic loss, the primary judge noted the respondent's evidence that, but for the effects of the treatment, he would have remained a ski instructor all his life; and the primary judge found that the respondent was highly regarded as a ski instructor and had the capacity to continue as such. 24 As regards future economic loss in Australia, the primary judge found that there was a difference between the amount he was previously able to earn in Australia and the amount he is now able to earn in Australia, and he noted that the respondent claimed a continuing economic loss of $138.00 per week for fifteen weeks each year. The primary judge averaged this over the year (multiplying by 15 and dividing by 52), and multiplied the result by the multiplier 787.9, giving $31,364.00. 25 As regards economic loss in the USA, the primary judge noted that taxation records revealed that the respondent was resident in the USA for the following periods: 153 days in 1992, 92 days in 1993, 142 days in 1994, 166 days in 1995, 124 days in 1996, 28 days in 1997 and 143 days in 1998. The primary judge was satisfied that the respondent lost the benefit of the 1996/97 American ski season by reason of the treatment, and was not persuaded that he would have lost a s ea son in any event. He noted the respondent's evidence that he had difficulties in carrying out work in Vail after the treatment, and that he worked only 89 of the 143 days in the USA in 1998, as compared with at least 100 days prior to treatment and usually 120 to 130 days. 26 The primary judge was of the view that the respondent's tiredness would continue and was likely to get worse as he got older. The trial judge considered that the respondent might do one or two more seasons at Vail, but was unlikely to continue this for any appreciable period. The respondent had sold his apartment in Vail because he could not keep up the mortgage payments while he was ill, and the cost of travel and renting accommodation would be substantial economic disincentives to continue. 27 Leaving aside the question of gratuities, to which I will come, the primary judge calculated the respondent's future economic loss from activities in the USA on the basis of a net income of A$304.00 per week for sixteen years, using the multiplier 665.2, giving a result of A$202,220.00. 28 The primary judge gave no award for loss of potentiality to work as a panel beater/spray painter, because he understood this to be brought as an alternative to the claim for loss as a ski instructor. 29 On the question of gratuities, the respondent had sought to claim an amount of US$100.00 per day by way of gratuities. This claim was not included in the respondent's particulars of economic loss, nor was it notified to the appellants until the case was opened. These amounts had not been included in the respondent's USA tax records because, according to the respondent, he was not required to declare that aspect of his income. The respondent applied to amend the particulars of economic loss, and this was objected to. The primary judge reserved the question whether the amendment ought to be allowed, to enable the appellants to make what investigations they could during the course of the trial. They were unable to complete the investigations during the trial, but the respondent continued to rely on this claim in closing addresses. No final ruling on the application to amend was made when the case concluded on 20th January 2000. 30 In his primary judgment in the case, delivered on 28th January 200, the primary judge said this: In a document setting out calculations of economic loss the plaintiff's counsel has relied heavily on the inclusion of between $5,000.00 and $10,000.00 per annum US in tips. This has the potential to add significantly to the claim for economic loss. Whilst I am reluctant to decide the matter without taking that aspect into account, I think in all fairness the defendant should be allowed to investigate the position. Because of the view I have taken in regard to other matters, I propose to allow the plaintiff leave to amend their particulars to make that claim and stand the matter over part-heard to enable the defendant to meet the amendments. However, that should not preclude me dealing with most other aspects of the claim presently before me. 31 In a further judgment given on 13th March 2000, the primary judge said this: For the purpose of finalising the judgement, the parties have agreed on one unresolved aspect and that is that a ski instructor, of the calibre of the plaintiff, could expect to earn between US$40-$100 per day in gratuities. The parties have agreed that a figure of US$70 per day would not be unreasonable. I am informed that such gratuities are subject to 20% tax, which is contrary to what the plaintiff said in evidence that he believed that such earnings were not tax deductible. The defendants say that they have been deprived of the opportunity of cross-examining the plaintiff as to credit on this issue. In my view that would hardly be likely to change the situation. The plaintiff did not complete his US tax returns - he gave them to a friend to do. He said in cross-examination on this point that he thought there was a distinction between waiting staff and other persons and was not aware, until pointed out to him, that part of the US tax form (Q8) required disclosure of gratuities, in which case he said he would have disclosed the tips he had received. He noted that restaurants added tips to the bill but this was not the case with ski instructors. If there is a credit issue here it is not one that, in all the circumstances, was likely to have affected the eventual outcome. As it is, the plaintiff s contention that he was getting up to US$l00.00 per day in tips has now been shown to be correct. … At page 28 I indicated the plaintiff was entitled to a nett income of about AUD$304.00. This is AUD$15,808.00 nett per annum for his losses in the US, where his gross income in Australian dollars would have been about $23,500.00 bearing, in mind that the income I have to assess is his gross nett income after tax not the nett income after taxable deductions. Apparently the 20% rate of tax, as far as it affects Mr. Smith, is a flat rate for all his income. That being so the nett Australian dollar amount of his US tips would be approximately AUD$86.00 per day. His evidence was that in 1998 he worked about 89 out of 143 days. Except for 1997 the number of days he was in the USA from 1992 to 1996 was 153, 92, 142, 166 and 124. Obviously he would not earn tips on days he was not working. Averaging out the above figures and taking roughly 62% as the proportion of days worked per annum, multiplied by $86.00 per day and divided by 52 weeks per year, there is an additional annualised income loss of about $139.00 per week. Using the 665.2 multiplier this comes to $92,462.00. This figure should be added to the figure reached at page 28 of the judgment of $AUD$202,220.00 making a total of $294,682.00. Past Economic Loss 97/97 USA Ski Season Averaging out the last 3 years prior to the operations, adding the component for tips, the nett economic loss for that year appears to be in the order of AUD$20,000.00 and I allow that amount. ISSUES ON APPEAL 32 The Amended Notice of Appeal included the following grounds: 1.His Honour erred in failing to make a reduction in damages against the possibility that had the respondent been diagnosed at an appropriate time more conservative treatment would have been undertaken. 2. His Honour erred in allowing the respondent to claim past and future lost United States gratuities. 3. His Honour erred in giving the appellants an adjournment after close of submissions. 4. His Honour erred in failing to make a deduction for residual earning capacity. 5. His Honour erred in failing to deduct outgoings necessary for the realisation of the respondent's earning capacity in the calculation of past and future economic loss in relation to the respondent's United States income (and consequentially an error occurred in the calculation of interest on the past loss). 6. His Honour erred in failing to make any deduction for vicissitudes in relation to future economic loss. 7. His Honour erred in allowing interest, on the paid portion of the judgment, from 13 March 2000. 33 The respondent raised the following contentions, being grounds on which the respondent intended to support the judgment apart from those relied on by the primary judge: Having found that the respondent was a qualified panel beater who had managed his own panel beating business, and having found that the respondent effectively had lost the capacity to work in his trade as a panel beater, his Honour ought to have made an allowance for this diminished earning capacity. Having found that the respondent had the capacity to work as a ski instructor for at the most two more seasons, his Honour ought to have allowed him more than 16 years with respect to future economic loss when the evidence was that he was 44 years of age at the time of trial and, if had he not been injured, he could have worked as a ski instructor beyond the age of 70 years. 34 At the hearing, the appellant abandoned Grounds 1, 2 and 4 in the Amended Notice of Appeal. In relation to Ground 7, the respondent conceded that the correct date for accrual of interest on the judgment should have been 19th April 2000. Accordingly, the Court heard argument only in relation to Grounds 5 and 6 of the Amended Notice of Appeal, and in relation to the respondent's contentions. Submissions 35 In relation to future economic loss, concerning activities in Australia, Mr. Walmsley SC for the appellant submitted that the trial judge should have deducted the conventional figure of 15 per cent for vicissitudes from the amount of $31,364.00. He referred to Wynn v. NSW Insurance Ministerial Corporation (1995) 184 CLR 485. He submitted that the circumstance that the judgment contained no mention of allowance for vicissitudes was indicative of error. A possible explanation for this could be found in the Black Book p.89, recording an exchange which could have left his Honour under the misapprehension that vicissitudes had already been taken into account in arriving at the relevant multiplier. 36 In relation to economic loss concerning activities in the USA, Mr. Walmsley submitted that the trial judge's calculations were based on a weekly figure of A$304.00, arrived at without deducting expenses necessary to earn that income: see James Hardie & Co. Limited v. Roberts (1999) 47 NSWLR 425 at 440. He submitted that the full deductions claimed in the USA tax returns should have been taken off as expenses; but alternatively, if the claimed deductions in respect of rent and food were not treated as expenses, then at least the deductions in relation to air fares, equipment, costs, and other expenses such as telephone expenses and health club dues, should have been taken off. If one took those expenses as amounting to about US$3,500.00 per annum, this would reduce the weekly figure from A$304.00 to about A$200.00. Taking the trial judge's multiplier of 665.2, this would give a figure of $132,040.00. 37 Furthermore, Mr. Walmsley submitted, the trial judge failed to take into account vicissitudes in relation to future economic loss from activities in the USA. Accordingly, 15 per cent should be deducted from the figure of $132,040.00, and also from the gratuities figure of $92,462.00 adopted by the trial judge. 38 In relation to past USA economic loss, expenses of about $5,000.00 should be deducted from the $20,000.00 awarded in relation to the year lost from USA activities, giving a figure of $15,000.00. 39 For the respondent, Mr. Cranitch SC pointed out, in relation to future economic loss concerning activities in Australia, that the trial judge's multiplier 787.9 was that appropriate in relation to earnings to age sixty-five, whereas the respondent had given evidence that he had calculated at forty, before the incident occurred, that he had a good thirty years ahead of him. That evidence was not challenged, and was apparently accepted by the trial judge. The appropriate multiplier for working to age seventy would be 922.2, and 15 per cent from that would give 783.87, approximating to the figure adopted by the trial judge. No error in the result was shown. 40 Mr. Cranitch submitted, in relation to future economic loss concerning USA activities, that it was not shown that A$304.00 per week was arrived at without deductions for expenses. In any event, he submitted, this Court could not find that this was not a reasonable estimate of the respondent's earning capacity. 41 In relation to vicissitudes, Mr. Cranitch pointed out that the multiplier 665.2 adopted by the trial judge was that appropriate in relation to earnings to age sixty. Even if the trial judge had allowed only to age sixty-five for the USA earnings, the multiplier would be 787.9; and 15 per cent from 787.9 would give 669.7, again approximating to the figure adopted by the trial judge. Furthermore, if it were assumed that the respondent stopped going to the USA at age sixty, there would be an unused earning capacity from age sixty onwards in respect of that part of the year when the respondent otherwise would have gone to the USA. That could have been used for his panel beating skills; and there was uncontested evidence that a manager of a panel beating concern could earn about $1,300.00 per week. Decision 42 During the hearing of the case, I was of the tentative view that error had been shown in failure to adopt expenses from USA earnings. This was based partly on my understanding of the actual figures for USA earnings, and also partly on that part of the second judgment of the trial judge quoted above where his Honour said he had to assess "gross net income after tax not the net income after taxable deductions". I had taken that to mean that his Honour took the gross USA income and deducted the tax payable in the USA, but not the "taxable deductions" claimed in the USA tax returns. 43 However, on a closer consideration of the figures, I now think this tentative view was incorrect. Just before the passage I have quoted, the trial judge said that the respondent's gross income would have been about A$23,500.00. I note that the respondent's gross income in the USAS in 1996, the last year before he was affected by the problems the subject of these proceedings, as shown in the USA tax returns, was US$15,343.00 (Blue Book p.221), which, at the 65¢ rate adopted at the hearing, converts to A$23,605.00, closely approximating to the trial judge's gross figure of A$23,500.00. The USA tax actually payable on the taxable income in that year appears to have been US$390.00 (Federal US$287.00, shown at Blue Book p.221, and State US$103.00, shown at Blue Book p.250), that is A$600.00. To arrive at A$15,808.00 (equivalent to A$304.00 per week), one would need to take from the gross figure less USA tax a further A$7,197.00, or US$4,678.00. 44 The evidence does not appear to contain itemised deductions for the 1996 USA tax return; but deductions shown in 1998 (apart from rent and food) amounted to US$4,350.00, out of a total, including rent and food, of US$9,710.00. In my opinion, it would not be appropriate to treat rent and food costs as expenses incurred in earning the USA income, where it is not shown or suggested that they were in excess of ordinary living expenses. I note that the total deductions as between rent and food and other deductions were the same in 1996 and 1998, that would give deductions other than rent and food for 1996 of US$4,897.00. It appears from these figures that the trial judge did adopt something like US$4,700.00 as expenses necessarily incurred in earning the USA income, and on the calculations I have made this would seem appropriate. 45 During oral submissions in this case, I reached the tentative view that it might be reasonable to take a different figure of around US$3,500.00 as an appropriate figure for expenses necessary to earn the income in the USA, the difference from US$4,700.00 being on the basis that some of the deductions, other than for rent and food, might be considered as living expenses or as giving the respondent valuable assets such as ski equipment and clothing. I note that, if one applied expenses of US$3,500.00 to the earnings in the two years 1995 and 1996, and averaged the results, one would by this route also reach a figure very close to that adopted by the trial judge. The gross earnings in 1995 were shown at US$12,682.00, and if one deducts from this the tax of US$215.00 and expenses of US$3,500.00, one reaches a figure of US$8,967.00. If one takes the gross figure of US$15,343 for 1996, deducts tax of US$390.00 and expenses of US$3,500.00, one reaches a figure of US$11,453.00. The average of those two years in then US$10,210.00, which at a 65¢ exchange rate gives A$15,708.00. 46 Accordingly, it now seems to me that the figure adopted by the trial judge of $A304.00 per week was a reasonable figure, albeit not adequately explained in the judgment. 47 In relation to past economic USA loss, one would add to A$304.00 per week the A$139.00 per week for gratuities, so that $20,000.00 for the loss of the 1996/97 American ski season appears to be justified. 48 As regards future economic loss in the USA and Australia, and as submitted by Mr. Walmsley, the trial judge made no mention of or explicit allowance for vicissitudes; and the passage in the transcript to which Mr. Walmsley referred does support the inference that his Honour did not allow for vicissitudes. The multipliers which the trial judge used do take into account vicissitudes concerning life spans, but not other vicissitudes such as illness and unemployment: the latter vicissitudes are the matters supposed to be covered by the conventional deduction of 15 per cent. In my opinion, the trial judge should have explicitly dealt with this matter, and prima facie error is shown in this regard, in relation to economic loss concerning both Australian and USA activities. 49 However, as submitted by Mr. Cranitch, there are balancing considerations. First, the adopted of age sixty-five for Australian activities in selecting the multiplier involves the rejection of age seventy as the most likely scenario, without any reasons being given. Secondly, the adoption of age sixty for selection of the multiplier in relation to USA activities involves both rejection of age seventy or age sixty-five for USA activities without reasons, and also no allowance for unused income earning capacity between stopping work in the USA and ultimate retirement. 50 In the light of these considerations, this Court is faced with the alternatives of sending the matter back for re-trial, or doing its best to determine the matter on the material it has. Both parties supported the latter course. 51 Doing the best I can, I think any error involved in not deducting 15 per cent for vicissitudes is balanced by the other considerations, so that no error is shown in the ultimate result. 52 It is common ground that interest on the judgment should accrue as from 19th April 2000, rather than 13th March 2000 as directed by the trial judge. This is a matter of so little moment that in my opinion the appellant should pay the costs of the appeal. 53 The orders that I propose are: 1. Order that interest on the judgment of $595,465.48 accrue as from 19th April 2000. 2. Otherwise, appeal dismissed with costs. 54 GREG JAMES, J: I have had the benefit of seeing the judgment which has been prepared by Hodgson, JA. in draft. I am grateful to his Honour for his setting out of the nature of the appeal and the circumstances which give rise to it. I respectfully adopt what his Honour says in that regard. 55 I have also had the benefit of seeing the draft judgment of Powell, JA. I share his views that there are features of the learned trial judge's assessment of the damages which, at first blush, give rise to disquiet. However, there is more to be said. 56 The trial judge refers to the assessment of past economic loss in Australia "in round figures at $6,000". Although Powell, JA. is of the view that the evidence to which he refers provided a very flimsy basis for that assessment, the trial judge's remark that that sum "(had) not been mathematically disputed" is supported in that that figure does not appear to be the subject of any dispute at trial and was not challenged on appeal. Indeed by letter of 18 April 2000, annexure B to the affidavit of Kerry Chambers sworn 28 May 2001, the appellants expressly took no objection to the figure shown for past economic loss (Australian season) as set out in the table of such matters in the letter as $6,000. 57 I note that the weekly figure of $138 to which Powell, JA. refers at paragraph 9(a) of his judgment dealing with future economic loss in Australia and which is the subject of the learned District Court judge's remark "there (was) a claim for continuing economic loss of $138 for 15 weeks each year" which is treated by Powell, JA. as unsupported, was also not challenged on appeal. 58 I do not consider in those circumstances there is any error in these respects. 59 Before us the challenge to the assessment of damages was concerned in particular with the loss of earnings in Australia and in America. As to the latter, issues were raised as to the extent of the liability in the United States for taxation, the expectation for gratuities in the United States and, thus, the past and future economic loss in the United States. As far as the assessment of damages for loss of earnings in Australia, there were raised the questions of the proper application of a deduction for vicissitudes and the appropriate multiplier considering the expected working life. 60 Before us, error was submitted to have been shown in a failure to deduct certain expenses from the USA earnings. I share the view of Hodgson, JA. that it would not be appropriate to treat rent and food costs as expenses incurred in earning the USA income where it is not shown or suggested they were in excess of ordinary living expenses, particularly in the absence of some evidence that they should be treated as expenses by reason of USA legislation. I note that airfares and accommodation were apparently allowed as deductions in the USA. I share Hodgson, JA.'s conclusion that the figure adopted for expenses was not shown to be inappropriate. 61 Although there are at least infelicities of expression, it does not seem to me that the figure allowed as representing the USA earnings A$304 per week was unreasonable if one takes the approach of Hodgson, JA., which to me provides a valid basis of support for that conclusion, although I share the views of Powell and Hodgson, JJA. that the acceptance of that figure does not seem to have been adequately explained by the trial judge. 62 The learned trial judge did not make a finding in express terms that the respondent would have continued as a ski instructor until 65 or 70 years, although there was, apparently, unchallenged evidence that a ski instructor had recently celebrated his 70th birthday. The trial judge's choice of the multiplier which he adopted for the purpose of ascertaining future economic loss, as Hodgson, JA. points out, might have been chosen as appropriate to a termination of ski instructing activity at 65 years or as allowing for some of the contingencies for which the customary 15% allowance for vicissitudes makes provision. 63 I agree with Powell and Hodgson, JJA. that his Honour erred in failing to make an explicit finding in respect of these matters and that that error affects the way in which he went about calculating economic loss in both Australia and the United States. 64 I have come to the conclusion, however, that I share the view of Hodgson, JA. that these errors do not necessitate that the appeal should be allowed. I do not share the view that his Honour's judgment was, as expressed by Powell, JA., to be so "fundamentally flawed" that it was not possible for the court to avoid the matter being remitted for a new trial as to damages. 65 Both parties supported this court determining the matter as best it could on the evidence before it on the analysis of Hodgson, JA. The errors exposed on the appeal are essentially errors of reasoning and procedure in the sense of the lack of expression of reasons which might have supported the conclusion challenged. 66 I accept the view of Hodgson, JA. that the errors are adequately enough balanced by the other considerations to which he refers so that the damages as awarded by the trial judge on our appreciation of the evidence cannot be said to be in error in the ultimate result. 67 I therefore agree with the orders proposed by Hodgson, JA. and as I have set out with his reasons. *********** 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. 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