Court of Appeal Supreme Court New South Wales

• Medium Neutral Citation: Nemeth v Westfield Shopping Centre Co Management Pty Ltd [2013] NSWCA 298
• Hearing dates: 21 June 2013
• Decision date: 09 September 2013
• Before: Meagher JA; Barrett JA

Decision

(1) Leave to appeal granted.

(2) Appeal dismissed.

(3) Appellant pay the respondents' costs of the proceedings in this Court.

[Note: The Uniform Civil Procedure Rules 2005 provide (Rule 36.11) that unless the Court otherwise orders, a judgment or order is taken to be entered when it is recorded in the Court's computerised court record system. Setting aside and variation of judgments or orders is dealt with by Rules 36.15, 36.16, 36.17 and 36.18. Parties should in particular note the time limit of fourteen days in Rule 36.16.]

• Catchwords: DAMAGES - assessment of damages - personal injury - non-economic loss - whether trial judge assessed on wrong factual basis - no question of principle; DAMAGES - assessment of damages - personal injury - economic loss - whether trial judge correctly concluded appellant's diminished earning capacity would not be productive of economic loss - no question of principle
• Legislation Cited: Civil Liability Act 2002, ss 13, 16; Supreme Court Act 1970, s 46A
• Cases Cited: Dell v Dalton (1991) 23 NSWLR 528; Graham v Baker [1961] HCA 48; (1961) 106 CLR 340; Husher v Husher [1999] HCA 47; (1999) 197 CLR 138; Medlin v State Government Insurance Commission [1995] HCA 5; (1995) 182 CLR 1; Moran v McMahon (1985) 3 NSWLR 700; Southgate v Waterford (1990) 21 NSWLR 427; Wilson v Peisley (1975) 50 ALJR 207
• Category: Principal judgment
• Parties: Rebecca Nemeth (Appellant); Westfield Shopping Centre Management Co Pty Ltd (First Respondent); PT Limited (Second Respondent)
• Representation: Counsel: S Norton SC, E Welsh (Appellant); G J Parker SC (Respondents); Solicitors: Brydens Law Office (Appellant); Piper Alderman (Respondents)
• File Number(s): CA 2012/179887

Decision under appeal

• Date of Decision: 2012-05-11 00:00:00
• Before: P Mahony SC DCJ
• File Number(s): DC 2010/426743

Judgment

1 THE COURT: The appellant sued in the District Court for damages for negligence in consequence of a fall she sustained in July 2009 in a carpark at a shopping centre at Liverpool managed by one of the respondents and owned by the other of them.

2 The appellant suffered a broken ankle. The respondents admitted liability. The matters in contest at trial were the question of contributory negligence on the part of the appellant and the quantum of damages.

3 After a trial lasting three days, Mahony DCJ made orders and published reasons on 11 May 2012. He found that there had been no contributory negligence by the appellant and that she was entitled to damages of $78,290.00 made up as follows:

Non-economic loss: $34,000

Past treatment expenses: $1,295

Future treatment expenses: $3,000

Past domestic assistance: $20,495

Future domestic assistance: $19,500

4 The appellant contends that the trial miscarried, so far as assessment of damages is concerned, and that the proceedings should be remitted to the District Court for a new trial on damages.

5 The appellant seeks leave to appeal. Her application for leave and the appeal itself were heard together, the latter pursuant to a direction of the Chief Justice under s 46A of the Supreme Court Act 1970 that it should be heard and determined by two Judges of Appeal.

Issues on appeal

6 The appellant challenges several aspects of the judge's decision on damages.

7 There is a challenge to the judge's assessment of non-economic loss and his conclusion that the appellant's injury represented 25 per cent of a most extreme case. The appellant says that that decision is flawed and that the finding should have been that the injury represented a greater percentage of a most extreme case. This is because the judge wrongly determined the likely duration of the appellant's condition and failed to give adequate weight to her depressive illness when assessing non-economic loss.

8 In relation to future economic loss, it is said by the appellant that the judge erred in finding that the appellant's need for future domestic assistance would cease after five years.

The evidence at trial

9 Three persons gave evidence at the trial: the appellant, her husband and Ms Hammond, an occupational therapist, whose written report was admitted. Beyond that, the court received into evidence several contemporary documents prepared by medical practitioners who saw and treated the appellant after she suffered injury and a number of reports containing opinion evidence of medical practitioners who examined the appellant for the express purpose of giving such opinion evidence.

10 None of the medical practitioners was called as a witness in the sense that none gave evidence on affidavit or in the witness box. It follows that the judge had no opportunity to hear the result of questioning calculated to amplify the content of documents or to test or probe what was said in documents.

Non-economic loss - principles

11 In order to displace the judge's assessment that, in terms of s 16 of the Civil Liability Act 2002, the severity of the appellant's non-economic loss was 25 per cent of a most extreme case, the appellant must establish an error of principle, a misapprehension of the facts or a "wholly erroneous estimate of the damage suffered": Moran v McMahon (1985) 3 NSWLR 700 at 717-719, 726; Southgate v Waterford (1990) 21 NSWLR 427 at 440-441; Dell v Dalton (1991) 23 NSWLR 528 at 533-534. In Wilson v Peisley (1975) 50 ALJR 207, Mason J, after noting that the assessment of damages is "more like an exercise of discretion than an ordinary act of decision", said (at 214):

"The settled rule, then, is that an appellate court will not disturb a primary judge's award of damages for personal injury unless it is convinced that he has acted on a wrong principle of law or that he has misapprehended the facts or that the amount of damages awarded is so inordinately low or so inordinately high as to be a wholly erroneous estimate of the damage suffered."

12 It is argued that the judge made errors in finding two facts on which it is said his assessment was based. Each finding is described in the appellant's written submissions as an "implied finding" because in relation to neither did the judge make an express finding in the terms suggested.

13 The first "implied finding" said to have involved error is that "the appellant would recover within five years from her physical injuries". The second is that "the appellant had recovered from the aggravation of her psychological injuries at the time of the judgment".

Non-economic loss - likely duration of injury

14 The finding as to recovery within five years is said to be implicit in the following conclusions of the judge:

"[71] ... Moreover, I accept the opinion of Dr Liaw that the plaintiff has chronic right ankle pain associated with subtle instability of her ankle joint. I also accept his opinion that she is likely to have on-going ankle pain. I also accept Dr Schutz's opinion that full recovery could take several years".

and:

"[79] ... Further, with the application of treatment by way of physiotherapy, the plaintiff's condition will improve to an extent where such assistance is not required and I therefore award damages for the future for a period of five years only at $25 per hour".

15 It is said that in the light of the way the judge dealt with the claim for future domestic assistance, he must be taken to have accepted Dr Schutz's opinion that the appellant was likely to achieve a full recovery. It is submitted that the evidence of Dr Schutz in this respect was necessarily inconsistent with that evidence of Dr Liaw which was that the appellant was "likely to have ongoing ankle pain".

16 It is argued that because the evidence of the doctors was inconsistent, his Honour must have erred in his consideration of it. It is said that absent some error he could not have accepted both opinions as supporting his conclusion. This Court should reconsider the question and should prefer the evidence of Dr Liaw as the appellant's treating orthopaedic surgeon.

17 This argument should be rejected. The evidence of the two practitioners is not necessarily inconsistent. In his report dated 9 August 2011 Dr Liaw said:

"Hopefully with physiotherapy her ankle pain will settle. However, if she continues to have ongoing ankle pain in two months' time she is to have a repeat MRI of her right ankle and to return for review. In my opinion, her prognosis is guarded. She is likely to have ongoing ankle pain."

18 The second sentence makes clear that the first acknowledges the possibility that the ankle pain will "settle" in the sense that the appellant might cease to have ongoing ankle pain. That said, the last sentence expresses a view that there is a likelihood of continuous ankle pain. It expresses no view as to the period over which that will be the position. The reference to the appellant's prognosis being "guarded" acknowledges that her condition may improve.

19 Dr Schutz, in his report dated 12 May 2011, said that the appellant's symptoms were "anticipated to fully recover but this sometimes takes a considerable period". He also expressed the view that those "symptoms may persist several years recovering gradually over that time".

20 The judge was not required to accept all of the opinions of Dr Liaw in preference to those of Dr Schutz. What he has done is to accept the opinion of Dr Liaw as to the presence of chronic ankle pain and the likelihood that the appellant will have "ongoing ankle pain". Dr Liaw acknowledges the possibility of recovery but does not express any opinion as to when that might occur. Dr Schutz expresses a view that full recovery is likely but that it may take "a considerable period".

21 The judge's conclusion is consistent with his having accepted this opinion of Dr Schutz without making any finding as to precisely how long the period to recovery might be. The judge has not by his conclusion at [79] treated that period as being five years. That conclusion refers to an improvement but only "to an extent" where future domestic assistance is no longer required. That is not a finding that at that point the appellant will be free of any ongoing ankle pain.

22 The appellant's first argument should be rejected. There was no finding made in the terms contended and the opinions of Dr Liaw and Dr Schutz which the judge accepts at [71] are not necessarily inconsistent so as to indicate, by the acceptance of both opinions, some undisclosed error in the reasoning process of the judge.

Non-economic loss - psychological recovery

23 The second "implied finding" is that the appellant had recovered from the aggravation of her psychological injuries at the time of judgment. The appellant argues that this finding is implicit in the following finding of the judge at [71]:

"[71] ... Further, I prefer the evidence of the plaintiff's treating psychiatrist, Dr Tucker, to that of either Dr Clark or Dr Revai, and do not accept Dr Revai's opinion that her psychologically based symptoms were not aggravated by the fall. I therefore find the plaintiff suffered a serious aggravation of her psychological condition which required her medication to be doubled".

24 The appellant maintains that the use of the past tense "suffered" and "required" is consistent with this finding being as to the position which existed following the accident and with the judge having concluded that the appellant's psychological condition was not current so as to be taken into account when assessing her non-economic loss.

25 An alternative reading of [71] is that the judge was making a finding as to the psychological injury sustained at the time of the accident and not making any finding that that condition no longer existed. In our view, the other findings of the judge and the evidence indicate that this finding in [71] should be understood in this way.

26 In her report dated 16 November 2010, which was 16 months after the accident, Dr Tucker explained that the injury had limited the appellant's ability to engage in regular physical exercise which was one of the "mainstays of treatment" for her existing anxiety and depression. For that reason the injury had exacerbated her anxiety condition by creating both fears of exercising and of not exercising. Dr Tucker's opinion made clear that that condition continued to exist in November 2010 and that the medication then prescribed was double the medication that the appellant required before the accident. The judge's expressed preference for the evidence of Dr Tucker is to be taken as an acceptance not only that the appellant suffered the aggravation of her psychological condition but also that she continued to suffer from that condition 16 months after the accident. The judge's earlier findings (at [70]) that the appellant continued to suffer pain and swelling in her right ankle, and that she was restricted in her mobility to walking no more than 500 metres and was unable to return to her pre-accident recreational activities, are only consistent with the continuation of the state of affairs which had exacerbated and aggravated her existing anxiety and depression.

Non-economic loss - conclusion

27 The judge did not make either of the "implied findings" which the appellant contends were made and involved error in the assessment of non-economic loss.

28 The challenge to the decision on non-economic loss therefore fails.

Economic loss - factual background

29 At the time of her injury the appellant lived in Sydney and was employed as a bookkeeper and office manager by Noppen Air Pty Ltd. After the accident in July 2009 she was off work for four weeks. She was earning $700 net per week in that position. On that basis, the judge assessed the appellant's past economic loss at $2,800: [74].

30 His Honour found that the appellant had suffered no financial loss since that time and was not likely to suffer any financial loss in the future as a result of any loss of earning capacity. In May 2010 the appellant left her employment with Noppen Air and moved to Port Macquarie where she was involved as an owner, with her husband, of a business known as Cold Rock Icecreamery. She worked in that business until March 2011. The evidence indicated that the appellant ceased to work in that business because it was not generating sufficient income to herself and her husband. For that reason each sought external work to supplement the income from that business which eventually closed in February 2012. The appellant worked in an administrative position with Faircloth & Reynolds between March and May 2011 and in a call centre with Essential Energy between May and September 2011.

31 The appellant gave evidence that since September 2011 she had been looking for "office administration work" but had been unsuccessful. Her evidence also was that she had only been looking for that type of work because she would not be able to work in "retail" due to the injury to her ankle. The evidence of an occupational therapist tendered by the respondents recorded the appellant reporting that she had made 15 job applications for administrative roles. That report also observed that "it was very difficult to obtain administrative work in Port Macquarie due to the limited job market".

Economic loss - principles and findings

32 Damages are awarded for loss of earning capacity to the extent that the diminution of earning capacity is or may be productive of financial loss: Graham v Baker [1961] HCA 48; (1961) 106 CLR 340 at 347; Medlin v State Government Insurance Commission [1995] HCA 5; (1995) 182 CLR 1 at 16, 18; Husher v Husher [1999] HCA 47; (1999) 197 CLR 138 at [7]. Accordingly, it is necessary to identify both what capacity has been lost and what economic consequences will probably flow from that lost capacity. The judge's findings as to the appellant's ongoing disabilities, which are not challenged on appeal, were as follows:

"[70] ... the plaintiff ... has suffered continuing pain and swelling in her right ankle. She is restricted in terms of her mobility to walking no more than 500 metres, and has trouble on stairs and uneven ground. She has not returned to any of her pre-accident recreational activities and has been restricted in what she can do in terms of heavy cleaning and domestic chores."

Economic loss - assessment

33 The appellant's evidence was that she was unable to stand on her feet for long periods of time (transcript 30 April 2012, at 18). On the basis of that difficulty the appellant maintained that she could not "go back into retail" because of the condition of her left ankle.

34 The judge accepted that the appellant's injury which resulted in her "inability to be on her feet for long periods of time" diminished her earning capacity. However he was not satisfied that this diminished capacity was or may be productive of financial loss. His Honour concluded:

"[74] ... I am not persuaded that her loss should be measured in any way by reference to an inability to be on her feet for long periods of time. There are three reasons for this. First, from 2000 she did not work in sales at all, rather, her qualifications and experience was all in office administration and bookkeeping. Secondly, when she established her own business, knowing that there was customer service involved, she was able to remain on her feet for a significant period of her employment hours. Thirdly, when her business failed, she returned to work in office administration. I am therefore not persuaded that her injury has been or may be productive of any financial loss ...".

35 The first of these reasons addresses the position before the accident and observes that during that period the appellant did no work in "retail" at all. The second addresses a period after the accident when the appellant worked in a sales position in the ice cream business for a period of 10 months and left that position for financial reasons. During that period the appellant's work required that she remain on her feet for a significant period of time. This indicated that there were positions which involved some standing which the appellant could pursue notwithstanding the disability. The third reason also addresses the position after the accident.

36 In respect of past economic loss, it was necessary for the appellant to establish that but for the injury and the effect it had upon her earning capacity, she could have obtained employment between September 2011 and the date of the hearing. There was no evidence which described or identified the sales or retail positions which it was claimed the appellant was prevented from pursuing because of an inability to be on her feet for long periods of time. Nor did the evidence address whether, had she been able to pursue those positions, the likelihood was that she would have sought and obtained such employment. In the absence of that evidence the judge was justified in concluding that the appellant had not established that her injury had been productive of past financial loss.

37 In relation to the claim for future economic loss, the judge addressed the appellant's "most likely future circumstances but for the injury", as required by s 13(1) of the Civil Liability Act. He concluded:

"[75] ... I find that the most likely future circumstances but for the injury will be that the plaintiff will return to work of that kind, namely, office administration and bookkeeping and that the injury to her ankle will not be productive of any financial loss. The chance that the plaintiff may at some time in the future return to sales type employment is speculative and does not support any award under s 13".

38 There seems to be some confusion in this passage. The judge was required to address the appellant's likely future circumstances but for the injury and to compare them with her likely future circumstances with the injury. This passage appears to be addressing the second aspect of this inquiry. However, the judge's finding indicates that he considered it likely that in the future the appellant would most likely seek and obtain office administration and bookkeeping work so that any diminished earning capacity would not be productive of financial loss. It is implicit in this conclusion that if in the future the appellant was unable to obtain work of that kind, it was not likely that she would have been able to obtain alternative work in a position which, due to her incapacity, was no longer suitable.

39 There was no evidence which identified more specifically the type of work or positions for which the appellant was no longer suited other than by reference to the labels "sales" or "retail". Nor was there evidence as to the likelihood that in circumstances where the appellant was unable to find work of the kind for which she remained fit, she might suffer financial loss because her ongoing injury would prevent her from obtaining other employment.

40 In the absence of such evidence the judge is not shown to have erred in not being satisfied that the appellant had suffered future economic loss.

41 We should note that it was not part of the appellant's case that the income she might have earned from any future employment which her injury prevented her from doing exceeded what she would receive from working in office administration and bookkeeping or some other occupation for which she remained suited.

Future domestic assistance

42 The judge made the following findings concerning the claim for damages for gratuitous attendant care services:

"[78] I am satisfied that the plaintiff required, for a period in excess of six months, more than six hours per week of domestic assistance which was provided by her husband and daughter. A need for that assistance was greater in the first 12 months following her injury, but on average, she required such care at an average of seven hours per week for two years following her injury. Thereafter, her need for such assistance has diminished. ... However, I assess her need for such assistance from July 2011 to the present time to be at an average of three hours per week".

43 The judge for those reasons awarded damages for past gratuitous domestic assistance during a period of two years for seven hours a week at $24 per hour and during the remaining period to the date of the hearing for three hours a week at $24 per hour.

44 The judge continued:

"[79] For future domestic assistance I am not persuaded that such assistance should be provided on a commercial basis merely because the plaintiff is not satisfied with the assistance being provided by her husband and daughter. The fact of the matter is that it is being provided in that way and there is no evidence that it would not otherwise be provided".

45 The appellant does not challenge these findings. In her written submissions she argues that "with respect to future domestic assistance it should either have been allowed at seven hours per week on a gratuitous basis or three hours per week on a commercial basis as commercial care is likely to be more efficient".

46 The judge is not shown to have erred in rejecting the claim for future domestic assistance on a commercial basis. His Honour found that the appellant's husband and daughter were providing gratuitous service at an average of three hours per week. There was no evidence which suggested that the gratuitous service would not continue to be provided or that if it was not provided the appellant would obtain domestic assistance on a commercial basis. In those circumstances he is not shown to have erred in awarding damages for the future on the basis of a need for gratuitous assistance for a period of five years only for three hours a week at $25 per hour.

Conclusion

47 The appellant has not made good any of the contentions advanced in this Court.

48 The orders are as follows:

1. Grant leave to appeal.

2. Dismiss the appeal.

3. Order that the appellant pay the respondents' costs of the proceedings in this Court.

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Decision last updated: 09 September 2013