Supreme Court New South Wales

• Medium Neutral Citation: Jianwei Liu v State of New South Wales [2014] NSWSC 933
• Hearing dates: 1 & 2 July 2014
• Decision date: 16 July 2014
• Jurisdiction: Common Law
• Before: Nicholas AJ

Decision

See paragraphs 36 and 37.

• Catchwords: TORT - Bailment - property destroyed whilst in police custody - damages - whether general damages payable for sentimental value.
• Cases Cited: Armory v Delamirie (1722) 1 Strange 505; [1722] EWHC KB J94; Biggin & Co Ltd v Permanite Limited (1951) 1 KB 422; Farley v Skinner (2002) 2 AC 732; Graham v Voigt (1989) 95 FLR 146; Ichard v Frangoulis (1977) 1 WLR 556; Jones v Schiffman (1971) 124 CLR 303; McCartny & Ors v Orica Investments Pty Ltd [2011] NSWCA 337; Murphy v Doman [2004] NSWCA 419; Rockdale City Council v Micro Developments Pty Ltd [2008] NSWCA 128; State of New South Wales v Moss (2000) 54 NSWLR 536
• Texts Cited: Palmer on Bailment, 3rd edition, Sweet & Maxwell (2009), paras 37-025; 37-017
• Category: Principal judgment
• Parties: Plaintiff: Jianwei Liu; Defendant: State of New South Wales
• Representation: Counsel: Plaintiff: T. Morahan; Defendant: B. Bradley; Solicitors: Plaintiff: Karrina Chen, Chen Shan Lawyers; Defendant: Stephanie Mulvery, Henry Davis York
• File Number(s): 2012/151321
• Publication restriction: No

Judgment

1 In these proceedings the plaintiff claims damages from the defendant for the loss of items of personal property confiscated by police officers and later destroyed whilst held in the custody of the New South Wales Police Force. The circumstances of destruction were not explained.

2 On 1 April 2011 the plaintiff was arrested and items of property were seized, taken to, and held at, a local police station. The property consisted of a Cartier watch, a white gold necklace, a jade pendant, a Louis Vuitton belt, shoes, and Mercedes Benz car keys. The property was destroyed on or about 21 August 2011.

3 It was common ground that these items were unrelated to an offence, and ought not to have been destroyed. The defendant accepts liability to compensate the plaintiff for the loss of his property.

4 During the hearing there was agreement as to the value of the following items:

Cartier watch: $13,300

Louis Vuitton belt: $565

Shoes: $750

Mercedes Benz car keys: $500

5 The only issue for trial was the assessment of damages for the loss of the necklace and pendant, and whether it should include an amount for compensation for sentimental value of those items.

The Evidence

6 An account of the history of the plaintiff's ownership of the pendant and necklace, and a description of these items, were given by the plaintiff and his father, Mr Bing Wen Liu. The following is a summary of the relevant evidence, which I accept.

7 The plaintiff was born in China on 5 June 1970. He migrated to Australia on 2 July 2001 to join his parents and sister. When the plaintiff was 20 years old the pendant was given to him by his father to whom it had been given by the plaintiff's grandfather prior to 1945.

8 In about 2007 the plaintiff entrusted the pendant to a friend, Ying Han, for inclusion in an exhibition of jade in Beijing. The plaintiff received a certificate which recorded the description of some features of the pendant. The document was headed "Testing Results" and, purportedly, was issued by the "National Gold & Diamond Testing Centre". Before it was returned to the plaintiff there were attached to the pendant a single white gold ring of approximately 0.4-0.5 centimetres in diameter, and two white gold rings of approximately 0.5-0.6 centimetres in diameter to the single white gold ring. Subsequently the plaintiff attached a white gold necklace (the necklace) to the two white gold rings which had been attached to the pendant.

9 Both the plaintiff and his father described the pendant in terms which were substantially similar, based on their observations of the item. Relevantly, the plaintiff said (affidavit 7 May 2013, para 11):

"11. I am thoroughly familiar with the jade pendant and describe the jade pendant as follows:

a. The jade pendant is transparent with hints of different shades of green on it.

b. The areas with different shades of green are still transparent, except for a small area with dark green colour near the corner of the jade pendant.

c. I named the jade pendant "(Chinese characters)" in Mandarin which translates to "floating green on a bed of ice" due to the transparency of the jade pendant and its different shades of green.

d. The jade pendant is oval in shape with a relatively wider and rounder bottom compared to its top part.

e. The entire piece of the jade pendant is approximately 5 centimetres in length and 3 centimetres in width.

f. The jade pendant has carvings of a Pixiu in a lying down position, a Ruyi, coins and flowers on it and the carvings on the jade pendant protrude outwards.

g. A Pixiu is a magical beast in Chinese mythology with a dragon's head, a horse's body, a qilin's feet and the overall shape of a lion. We Chinese believe that it brings good luck and wards off evil.

h. A Ruyi is a short sword with a sword-guard and is usually shown to be held by the Chinese Gods for self-defence or gesturing.

i. The jade pendant has the same shades of green distributed on both the front and back of the pendant and is carved with exactly the same carvings on both the front and back of the pendant.

j. On the side of the jade pendant where the dark green area is on the bottom right of the pendant, the Pixiu is carved on the center left side near to the edge and the Ruyi is carved at the center right side near to the edge, whereby parts of the Ruyi is covered in a dark green shade. Some coins and flowers are also carved throughout the jade pendant.

k. The thickness of the jade pendant, inclusive of the thickness of its carvings, is approximately 0.6 centimetres. The carvings protrude approximately 0.22 centimetres from the even surface of the jade pendant. The smooth circular edges of the jade pendant were slightly thinner than the rest of the jade pendant, being about 0.4 centimetres in thickness.

l. The jade pendant has a small hole of approximately 0.2 centimetres in diameter at the top part of the jade pendant so that a string can be tied through it to form a necklace."

10 The plaintiff said he wore the pendant and necklace continuously until it was confiscated. He cherished the pendant as a family heirloom.

11 As to the issue of valuation of the pendant and the necklace, the difficulty which confronted the parties was that the items no longer existed. The only available information for consideration by an expert consisted of a photograph of the pendant and necklace taken by police on 1 April 2011, the certificate, and the description given by the plaintiff.

12 The plaintiff claimed these items, particularly the pendant, were of substantial value. However, no evidence was adduced by the plaintiff as to the value of either. Ms Karrina Chen, the plaintiff's solicitor, deposed to numerous unsuccessful efforts between February 2012 and early 2014 to locate an appropriate expert to provide a valuation report for these proceedings. In evidence were letters of 14 December 2013 and 24 March 2014 to Ms Chen from Catherine Ricketts, an expert valuer, who declined to provide a valuation of the pendant. Her letter of 14 December 2013 included:

"Regarding your request to value a 'Jade pendant', I am unable to make an accurate valuation based on a photograph and worded description.

The nature of this piece requires physical inspection, without this any valuation would be simple speculation.

Physical inspection would inform towards craftsmanship and quality of the stone. It is of my professional option that macroscopic hardness and Gemmological testing is essential to determine the value of this jade pendant."

13 For the valuation of the pendant the defendant relied upon the reports of Mr Warren Joel, who has about 35 years experience as an auctioneer and specialist valuer and, inter alia, is approved to value a wide range of objects for the Australian Government's Cultural Gifts Program, including Chinese, Japanese, east and south-east Asian jade after 1800. The plaintiff accepted his general expertise.

14 In his report of 18 November 2013, Mr Joel noted the lack of information as to age, type, carving, origin and condition, being factors relevant to the valuation of a particular jade piece. He explained that there are many different types of jade including jadeite, nephrite jade and jade, within each of which there are varieties of colours and combinations of colours. He noted the absence of detail about the pendant itself regarding age, authenticity, rarity, value or general collectibility. His estimation of the valuation range was expressed as follows:

"Without the supporting evidence as to age, type of Jade, origin and condition I can find no precedent for this type of item selling for more than one thousand dollars, at the most. If I look at the photo of the pendant that is the subject of this case and any of the pendants selling for more than $5,000 or even $10,000 there is a fundamental difference in the overall appearance. The missing pendant would appear to be more of what I would consider a 20th century copy."

15 In his report of 3 April 2014, Mr Joel said:

"1(B) Reasons why I maintain my original valuation of the missing pendant.

I. As discussed in my report there are many factors that contribute to the value of the jade, and to achieve a higher value all of the elements must be present in the one item. These include colour and translucency. The missing pendant is lacking both these elements.

II. I still maintain that, in my opinion the missing pendant looks like a piece of cheap 'tourist' jade, and as such could not be worth more than the $5,000-$10,000 at the most."

16 Mr Joel said he proceeded on the basis that the pendant was jade as described in the translation of the certificate provided to him. He observed that the item in the photograph in the certificate appeared to be the same as that shown in the police photograph, and considered that the plaintiff's description was consistent with the item as depicted in the police photograph. He accepted that on the limited information available his opinion necessarily had a speculative element, as in any valuation. Although cross-examined at some length, he adhered to his estimate of value. In my opinion, his estimate was not undermined. I accept it as a reliable guide for the purpose of the assessment I am required to make.

17 During the hearing, and for the first time, an issue arose in respect of the correct translation of an entry in the certificate. The question was whether the Mandarin characters opposite the word "Conclusion" meant "jade" or "jadeite". Experts in Mandarin, Mr Wang, and Ms Lum, gave evidence of meanings. Mr Wang, for the plaintiff, said that the characters meant "jadeite", but accepted the meaning "jade" was open. Ms Lum, for the defendant, understood the characters meant "jade", which she said was a generic term which could refer to different types of jade. In the English version of the certificate seen by Mr Joel the pendant was described as "jade".

18 The conclusion I draw from their evidence is that it was open to the reader to understand the characters to mean either "jade" or "jadeite". In my opinion it is unnecessary to resolve any difference as to meaning for the purpose of assessing the value of the pendant. From the outset, the plaintiff and his father described the pendant as "jade", and the case proceeded on the basis that such description was appropriate. Mr Joel based his valuation on the assumption the pendant was jade having regard to the translation of the certificate provided to him. However, he said that knowledge that the pendant was jadeite would not have caused him to alter his valuation.

The Principles

19 With regard to the assessment of damages where quantification is difficult guidance is afforded by the authorities. It is sufficient to refer to the following.

20 In Armory v Delamirie (1722) 1 Strange 505; [1722] EWHC KB J94 it was held that in the circumstances of that case the jury could presume the strongest case against the defendant and make the value of the best jewels the measure of the damages.

21 In State of New South Wales v Moss (2000) 54 NSWLR 536 Heydon JA said:

"[72] Thirdly, the mere fact that the quantum of damages is difficult to assess does not mean that the plaintiff is only entitled to a nominal sum. This principle applies as much to the assessment of damages for impaired earning capacity in injured plaintiffs as it does to pecuniary loss caused by negligent advice (Bowen v Blair [1933] VLR 398) or to loss in the form of the diminished value of damaged property (Wheeler v Riverside Coal Transport Co Pty Ltd [1964] Qd R 113), or equitable damages (Talbot v General Television Corp Pty Ltd [1980] VR 224 at 250-1), or damages for breach of contract (Fink v Fink (1946) 74 CLR 127 at 143). In the last case, Dixon and McTiernan JJ put the following general proposition: "Where there has been an actual loss of some sort, the common law does not permit difficulties of estimating the loss in money to defeat the only remedy it provided for breach of contract, an award of damages." This was followed in Sellars v Adelaide Petroleum NL (1994) 185 CLR 332 at 349 per Mason CJ, Dawson, Toohey and Gaudron JJ. The same is true in tort. In Naylor v Yorkshire Electricity Board [1968] AC 529 at 548 Lord Devlin said: "in the law of damages ... difficulty in calculation is not ordinarily taken as a ground either for reducing or for increasing the award". The court will be more ready to shoulder the burden of acting without specific evidence where that evidence is difficult to call. In Biggin & Co Ltd v Permanite Ltd [1951] 1 KB 422 at 438, a sale of goods case involving a recovery in respect of damaged goods, Devlin J said: "It is only that where precise evidence is obtainable the Court naturally expects to have it. Where it is not the Court must do the best it can". As McPherson J said in Nilon v Bezzina [1988] 2 Qd R 420 at 424: "The degree of precision with which damages are to be proved is proportionate to the proof reasonably available". The courts on occasion cite in related contexts Bowen LJ's related but stricter observation in Ratcliffe v Evans [1892] 2 QB 524 at 532-523, an injurious falsehood case:

'In all actions ... on the case where the damage actually done is the gist of the action, the character of the acts themselves which produce the damage, and the circumstances under which these acts are done, must regulate the degree of certainty and particularity with which the damage done ought to be stated and proved. As much certainty and particularity must be insisted on ... in ... proof of damage, as is reasonable, having regard to the circumstances and the nature of the acts themselves by which the damage is done.'"

22 In McCartny & Ors v Orica Investments Pty Ltd [2011] NSWCA 337 Giles JA said:

"[158] Such a course is not a substitute for proof of loss, or an invitation to punishment rather than compensation. It need not be taken, but may be; many assessments of future economic loss from impairment of earning capacity, for example, involve uncertainty, but an approach of resolving the uncertainty against the wrongdoer is generally not taken. Where within the proved case there is a range, however, the wrongdoer can hardly complain if the loss is found at the upper end of the range.

[159] L J P Investments Pty Ltd v Howard Chia Investments Pty Ltd (No 2) and Houghton v Immer (No 155) Pty Ltd were distinguished by Rolfe J in Lavender View Pty Ltd v North Sydney Council [1999] NSWSC 255 ; (1999) 104 LGERA 255. His Honour regarded Armory v Delamirie as a different case from the case before him, and did not think that any conduct on the defendant's part had caused the plaintiff difficulty in quantifying its damages; he applied the "the fundamental proposition that the onus is on the plaintiff ... to prove the amount of damages" (at [23]). A robust approach against a defendant whose wrongdoing has required the plaintiff to prove its damages, where proof of the damages involves uncertainty, is not inconsistent with that proposition. Indeed, the proposition does not always hold good, see the particular situation of a claim for reliance loss caused by breach of contract described by Hodgson JA (Allsop P and Macfarlan JA agreeing) in Macquarie International Health Clinic Pty Ltd v Sydney South West Area Health Service [2010] NSWCA 268; (2010) 15 BPR 28,563 at [163]-

In those cases where it is not possible for a plaintiff to prove whether or to what extent performance of a contract would have been profitable, it can seek to recover expenses reasonably incurred and wasted on the contract, albeit that it cannot recover more than would have been recovered by performance of the contract. However, in those cases where a contract has been rescinded for breach, making it impossible for the plaintiff to prove that it would have recovered those expenses from performance of the contract, the onus shifts to the defendant to prove that it would not have done so: Commonwealth v Amann Aviation Pty Ltd [1991] HCA 54; (1991) 174 CLR 64."

and Young JA said:

"[218] Putting all these thoughts together, it would seem that the tag "Armory v Delamirie" has been attached to a number of similar though possibly distinct principles. First, in cases where there is an action in tort relating to chattels, if the defendant who was last seen in possession of the chattel does not produce it, the court can assume it is the most valuable chattel of the type. Secondly, in actions in debt where no wrongdoing is attributable to the defendant, the plaintiff must prove its case and, if it shows that there is some damage, but cannot prove quantum, the smallest amount is allowed. Thirdly, where the plaintiff is entitled to damages and compensation and their computation is made more difficult by the defendant's action, then the court may assume the worst against the defendant consistent with the evidence. Fourthly, in cases such as those dealt with in Commonwealth v Amann Aviation, the defendant has the ultimate onus of proving that, had the contract been performed, the net value of the plaintiff's benefits would not have covered the expenditure incurred before rescission."

23 In Rockdale City Council v Micro Developments Pty Ltd [2008] NSWCA 128 Giles JA said:

"[66] ...The task was to arrive at what could only be an estimate of Micro's loss. In any case where precision is not possible or not realistic the court must arrive at the loss despite the difficulty of doing so, including when the loss is from breach of contract (Fink v Fink (1946) 74 CLR 127) or from negligent advice (Bowen v Blair (1933) VLR 398): see generally State of New South Wales v Moss [2000] NSWCA 133, (2000) NSWCA 133, (2000) 54 NSWLR 536 in the reasons of Heydon JA."

Consideration

24 The plaintiff candidly declined to propose an amount as the reasonable value for either the pendant or the necklace. The Court was urged to adopt a robust approach favourable to the plaintiff to arrive at an amount in excess of Mr Joel's upper estimate, it being reasonable to take a generous view in circumstances where the defendant's wrongdoing had made quantification difficult. In effect, it was put that it was open to find that Mr Joel had downplayed his assessment, having come to the view that the piece was merely "tourist jade", whereas the Court should make an assessment based on the assumption that the pendant was jadeite, and probably of greater value than jade.

25 For the defendant it was fairly conceded that it was open to value the pendant at the high end of Mr Joel's range. It was put that, in the circumstances, there being no evidence to support a finding that the pendant was jadeite, the Court should make an assessment on the basis that, in fact, it was jade.

26 It was common ground that there was no evidence of the value of the white gold chain or necklace. The defendant submitted that the plaintiff had failed to prove the value of this loss and, accordingly, the Court was left without the basis upon which any assessment could be made.

27 In deference to the plaintiff's submissions, I keep in mind that the task of assessment is very different in this case from the assessment, for example, of damages for diminished earning capacity which has been said to sometimes involve "guess work rather than estimation" (Jones v Schiffman (1971) 124 CLR 303 at 308 per Menzies J).

28 In the State of New South Wales v Moss Heydon JA (para 72) referred to authorities which demonstrate that difficulty in quantification of the loss claimed should not prevent the assessment of an appropriate award of damages for a loss, and that "The Court will be more ready to shoulder the burden of acting without specific evidence where that evidence is difficult to call". His Honour also referred to Biggin & Co Ltd v Permanite Limited (1951) 1 KB 422 at 438 in which Devlin J said "It is only that where precise evidence is obtainable the Court naturally expects to have it. Where it is not the Court must do the best it can". Thus, where there is a want of specific evidence, the Court is required to do the best it can with the materials before it to assess damages. As in every case, the Court is confined by the evidence. In a case such as the present, as explained by Giles JA in McCartney & Ors v Orica Investments Pty Ltd (paras 158, 159) the fundamental proposition remains that the onus is on the plaintiff to prove the amount of damages although "...Where within the proved case there is a range...the wrongdoer can hardly complain if the loss is found at the upper end of the range". In the same case, Young JA (para 218) held "...where the plaintiff is entitled to damages and compensation and their computation is made more difficult by the defendant's action, then the court may assume the worst against the defendant consistent with the evidence".

29 In the present case, of course, the only evidence of value of the pendant was adduced by the defendant. It was uncontradicted. Mr Joel's expertise enabled him to value the pendant within a wide range, taking into account the lack of information in relation to various relevant factors and, I infer, also the uncertainty resulting from such lack of information. In my opinion, the fact that the plaintiff was unable to obtain similar evidence does not justify the Court in departing from the evidence before it, or to make an assessment not consistent with it. Nevertheless, as the defendant properly acknowledged, in the circumstances it is open to find the loss at the upper end of the range.

30 In my opinion, the destruction of the pendant whilst it was in the hands of the police justifies the Court in assuming the worst against the defendant consistent with the evidence. Accordingly, I assess the value of the loss of the jade pendant in the amount of $10,000.

31 Absent evidence relevant to the value of the necklace, the Court was left with no rational or principled basis upon which to make an assessment. It follows that the plaintiff's claim for an award of damages for this item must be rejected.

32 Also claimed as a component of general damages in compensation for the loss of the pendant was an amount for its sentimental value to the plaintiff. No particulars of the claim were pleaded, and no submissions in support of it were made until very late in the day, although it had been faintly flagged earlier (Tp28). This unsatisfactory situation was remedied by providing the parties opportunity to provide written submissions on the issue.

33 The claim is to be assessed with regard to the personal or emotional value of the piece to the plaintiff, as distinct from its objective or intrinsic value. It is now settled that the scope of general damages payable in cases of the present kind is not confined to economic loss or market value, but may include an amount for non-pecuniary loss (Graham v Voigt (1989) 95 FLR 146; Ichard v Frangoulis (1977) 1 WLR 556; Murphy v Doman [2004] NSWCA 419; Palmer on Bailment, 3rd edition, paras 37-025, 37-017).

34 The plaintiff's evidence, which I accept, was that the pendant was of significant meaning to him. He regarded it as a family heirloom which had been handed down through his grandfather and father. It was given to him when he was about 20 years old, and he had worn it everyday since about 2005. I am satisfied that the pendant had real sentimental value for the plaintiff, and I infer that its loss and destruction would have been deeply felt. Furthermore, in my opinion, it was reasonably foreseeable that the pendant was a possession of sentimental value to the plaintiff.

35 Mindful that damages are compensatory, an assessment is necessarily a matter of impression as to which there are no clear standards which can be applied (Murphy para 4). Quantification should be modest (Farley v Skinner (2002) 2 AC 732 p 748). In my opinion the appropriate amount for sentimental value is $2,500.

Conclusion

36 The plaintiff is entitled to an award of general damages referrable to the value of the items, other than the necklace, in the total amount of $ 25,115, to be increased by the amount of $2,500 referrable to sentimental value. I propose to award damages to the plaintiff in the total amount of $27,615, with judgment accordingly.

37 The parties are directed to bring in short minutes to give effect to this conclusion. As the questions of interest and costs remain outstanding, absent agreement, the parties should have the opportunity to make submissions on these issues. I should indicate that in relation to costs my prima facie view is that the defendant should be ordered to pay the plaintiff's costs on the ordinary basis. The parties are directed to arrange with my Associate by 4pm 21st July 2014 for the matter to be re-listed for the purpose of hearing any argument.

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Decision last updated: 16 July 2014