New South Wales Supreme Court CITATION : Sullivan v GIO [2005] NSWSC 239 HEARING DATE(S) : 16 March 2005 JUDGMENT DATE : 16 March 2005 JURISDICTION : Common Law JUDGMENT OF : Greg James J at 1 DECISION : Allowance for holidays made. CATCHWORDS : Allowance for future holidays - interim payment of verdict ordered - future case management ordered to commence immediately - other questions to be the subject of written submissions. LEGISLATION CITED : Damages (Infants and Persons of Unsound Mind) Act 1929 CASES CITED : Rosniak v Government Insurance Office (1997) 41 NSWLR 608 TOBY DANIEL SULLIVAN BY HIS NEXT FRIEND TIMOTHY SULLIVAN v, GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES PARTIES : FILE NUMBER(S) : SC No 20777/86 Plaintiff: K. Nomchong COUNSEL : Defendant: K. Elkaim S.C. Plaintiff: Carroll & O'Dea SOLICITORS : Defendant: Bartier Perry LOWER COURT JURISDICTION : - 4 - IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION GREG JAMES, J. WEDNESDAY 16 MARCH 2005 No 20777 of 1986 TOBY DANIEL SULLIVAN BY HIS NEXT FRIEND TIMOTHY SULLIVAN v GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES JUDGMENT 1 HIS HONOUR: On 7 March 2005 I published a judgment in this matter in which I reserved certain questions for further consideration. Counsel have today raised, on their feet, a number of questions including whether future case management, for which I had allowed a sum of $530,400, should commence immediately. Having regard to paragraph 122, and in particular the third sentence of that paragraph and the last sentence of that paragraph, I have concluded that further case management should commence immediately. It may be, as was properly pointed out to me by Mr Elkaim of Senior Counsel for the defendant, that I had provided for the defendant to remain at home until 1 January 2007 and that I had allowed for further parental care, but as and from the time of the judgment, in my view the commencement of the future case management should occur. 2 Indeed, it would have been appropriate for someone professionally skilled and qualified in that behalf to have been furnishing case management for him since the very earliest days after the accident. That is a function his mother and father have performed on his behalf. There is no reason why their involvement with his problems which I found in the judgment should be winding down, should continue as intensely as it has with them performing all functions for him and acting as his frontal lobes, rather than that a person professionally skilled should not immediately commence to take up the traces. 3 I hold that further case management should commence as at the judgment. 4 There was also raised a matter concerning future attendant care that had been allowed in the judgment (paragraph 119), at the rate of $31 per hour, that being what I had thought had been submitted by the plaintiff. My attention has been drawn to the plaintiff's written submission. It was also submitted, I had overlooked provision for a handyman and for carers keep. As it happens, the reference to "handyman" is on the following page to the principal portion of the plaintiff's submission on this component. 5 Another matter also arises. I had provided for the rate for future care to include superannuation at 9 per cent, public holiday loading, workers' compensation insurance and anti-deployment fee. My attention was drawn by the plaintiff's counsel to the schedule that had been provided by the plaintiff on which the submission was based, which, I am now informed, included those items but not as part of the fees that were averaged into the $31 per hour referred to in the plaintiff's submissions but in addition to them. 6 I have made no finding expressly in the judgment about "handyman" or about "carers' keep". I have advised the parties to let me have specific written submissions on, firstly, whether it is open to make any further finding on these questions having regard to the nature of the judgment I have delivered and, secondly, if it is so open, what course I should properly adopt in regard to them. 7 Still another matter arises. I have allowed in the judgment in paragraph 177 administration services for the funds generated by reason of payment of the judgment sum. That paragraph continues: "The parties have agreed that this figure is to be assessed in accordance with Exhibit F. That table refers to future fund management costs as charged by the protective commissioner using a five per cent discount rate related to the total value of damages to be administered". 8 At paragraph 179 I invited the parties to consider: "Whether there is error in my figures, to do the relevant calculations and derivation of the final figure for each component of damages to be ascertained, to check the arithmetic, ascertain the appropriate administration expenses and to submit in draft the form of the final orders to be consistent with these findings." 9 I was informed by the parties that although at the time at which the parties made their submissions and up to a time well after the judgment was reserved, the Public Trustee or Protective Commission, calculated administration expenses in accordance with a mode of calculation approved by the Court of Appeal in Rosniak v GIO (1997) 41 NSWLR 608, but that by a change in regulation allowed to pass, unnoticed both by me and by counsel, the mode of calculation was changed to provide for a present mode much more expensive. 10 I have been informed that other modes of the calculation of administration expenses by other more commercial entities engaged in the field produce a figure of administrative expenses considerably higher than the increased Public Trustee figure. 11 An issue arises as to whether, therefore, I had determined in the judgment that future administration expenses should be paid according to the Rosniak method or as they might be calculated by the public trustee. My tentative view is that is not so specific as to either. I feel I had left the matter open. I had specifically referred to the calculation of the administration expenses as a matter being left open but since that proposition is one that is hotly contested by Mr Elkaim for the defendant, I have again reserved to the parties the opportunity to put in written submissions on that matter. 12 The parties have also raised a problem as to the calculation of such an allowance as is to be made in the judgment for future holidays. In accordance with the way in which the parties presented the matter, I dealt with individual components for the purposes of ascertaining figures under the heading of those components, which would comprise in sum the total of the damages award. One component was for future holidays, for which I made an allowance, the value of which must however be calculated in monetary terms. In this regard, it has been submitted to me by the plaintiff that the proper way in which to deal with an allowance for further holidays is to bring forward that sum which, when calculated and to which the five per cent tables might be applied, would represent the costs that it would now be expected such holidays would incur. 13 Mr Elkaim, on the other hand, has submitted that that is not an appropriate way to deal with a further liability seen to arise only intermittently, that is to say, there is not a continuing further incurring of costs. The costs of the holidays will only occur discretely and at intervals. He submits the appropriate course is simply to allow a lump sum now based on present costs but recognising that each holiday cost is a deferred liability. 14 The difference between the sums the parties contend are appropriate under this heading is the difference between the $170,243, the defendant's contention, and the plaintiff's assertion of $255,274.64. A great deal of this kind of reasoning is artificial and this perhaps more than any other component reflects this. 15 I am, according to the ordinary principles of damages, to have regard to what the plaintiff has lost by reason of the negligence of the defendant and, as far as is reasonable, to put him back in the position in which he would have been. That is practically speaking however, a position in which he could not be put by the simple award of money. 16 Having that principle in mind, there comes a point at which dealing with the matter by way of component and calculation in such detail is so far away from reality that it ceases to be a useful exercise at a particular level of detail. Calculating the further holiday costs involves a mass of such detail, not least the consideration of e.g. occurrence of natural disasters in holiday areas, the cost of travel insurance, the prospect of not getting a refund when the natural disaster occurs. 17 One would have thought that some sort of allowance for some vicissitudes might well be applied here but my understanding of the current thinking is that it is not. What is more currently done is to round out a figure which, if awarded now, will involve the potential for the future. 18 The application of the five per cent tables in that context accordingly seems to be simply too nice and too fine. In my own view, having regard for the future and having regard to the prospect of the costs increasing, it is better to take the view of allowing a global $230,000 under this head and I do. 19 Application has been made by the plaintiff in consequence of the issues of which I have already spoken still remaining outstanding, for an interim payment of damages comprising part of the award in respect of which no objection is taken. Mr Elkhim, who appears for the defendant, is concerned as to the quantum and, in particular, concerned because his instructions go so far as to indicate that he might be seeking to appeal to challenge so much of the award as exceeds in total the sum of six million dollars or to challenge the whole award, but he would seek a stay, only in respect of any liability to pay beyond that sum, while consideration is given to the question of whether there should be an appeal. 20 He is not in a position to give any consent to or opposition to whether or not an interim payment of that portion of the total verdict comprising six million dollars not in contest should be made pending the resolution of the outstanding questions. I note that those questions all involve sums, which would render the verdict well in excess of six million dollars. Miss Nomchong on behalf of the plaintiff has sought only that the six million dollars be paid in immediately for payment out in accordance with appropriate orders of the Court. 21 I will, therefore, order that the defendant pay by way of interim payment of damages into Court by reason of s 4 of the Damages (Infants and Persons of Unsound Mind) Act 1929 the sum of six million dollars. 22 I make orders in accordance with s 4(c) for payment out of the sums set out in respect of the items referred to under the heading Less Payments Out, page 5 of the draft calculation for final verdict comprising past gratuitous care $546,259/17, past out of pocket expenses $93,023.00, interest on past out of pocket expenses $102,291.64, past recreational expenses $5,000, a total payment of $79,692.74 to the Royal Blind Society, $3,865 to the Guide Dog Association, $45 to the Spastic Centre of New South Wales, $545 to Mr David Begg in respect of $11,570. That is a total to those other parties of $99,927.52. 23 I further order that the balance of the six million dollar interim payment be paid to the National Australia Trustees Ltd as manager of the estate of the defendant appointed by order of this Court of 7 June 2004. 24 I allow 28 days for payment in. ********** - 6 - 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.