Tomislav Lipovac Bhnf Maria Lipovac v Hamilton Holdings Pty Ltd, Peter Black, Tom Gavranic and the Australian Capital Territory [1997] ACTSC 23 (23 April 1997)

SUPREME COURT OF THE ACT

TOMISLAV LIPOVAC bhnf MARIA LIPOVAC v. HAMILTON HOLDINGS PTY LTD,
PETER BLACK, TOM GAVRANIC and THE AUSTRALIAN CAPITAL TERRITORY
No. SC501 of 1993
Number of pages - 6
Practice and Procedure

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY HIGGINS J

CATCHWORDS

Practice and Procedure - slip rule - calculation of damages - contingencies - heads of damage.

Supreme Court Rules (ACT), O32 r14

HEARING

CANBERRA, 18 March 1997 23:4:1997

Counsel for the Plaintiff: Mr B Donovan QC Instructing solicitors: Cashman & Partners

Counsel for the First Defendant: Mr T Worthington QC with Mr A R Harris Instructing solicitors: Fisher Jeffries

Counsel for the Third Defendant: Mr P Garling SC Instructing solicitors: Blake Dawson Waldron

Counsel for the Fourth and Mr P Donohoe QC Fifth Defendants: with Ms P Burton Instructing solicitors: ACT Government Solicitor

ORDER

THE COURT ORDERS THAT:
The judgment entered for the plaintiff be amended to $7,364,345.55.

DECISION

HIGGINS J
1. Submissions have been received from the third defendant suggesting corrections which ought to be made to the sums awarded herein. The plaintiff's solicitors responded thereto on 17 March 1997.

2. The "slip rule" is expressed for this Court by O32 r14 of the Supreme Court Rules, The Court may at any time, on application by a party of its own motion, correct a mistake in a judgment or order or an error in a judgment or order arising from an accidental slip or omission.

3. I accept that errors of calculation or of transposition of figures, whether arising from oversight or other error, may be corrected under this rule.

Loss of Earning Capacity/Superannuation 4. The third defendant submits that instead of 5% reduction for contingencies for this head of damage, 15% should be applied.

5. The plaintiff submits that the application of 5% was a necessary consequence of my findings concerning contingencies, see p2-4 reasons 17 January 1997.

6. The assumption of life expectancy of 60 represents a discount of what otherwise would have been assumed. It equates end of working life with end of life. Thus the same chance of unfavourable contingencies applies to each head of damage dependent on end of working life or of life as the case may be insofar as the contingency of premature death is concerned. For the "lost years", the usual contingencies apply. It is predicated on normal life expectancy. If life expectancy had been age 67, then for end of working life at age 65 there would be an allowance for premature death less than for the assumed age of end of life.

7. Contingencies adverse to end of life age 60, would be only premature death. That is a much lesser contingency than for usual whole of life or, indeed, age 65 or 67 as the case may be. However, contingencies impacting on working life ending at age 60 would also include disablement for work and periods of unemployment. As against that there is the contingency that the plaintiff might have done better than average. It follows that I should have applied the finding I made at p3, 17 January 1997 by allowing some greater contingency, but less than the usual allowance of 15%, against the assumption of earnings to age 60 than for the contingency of premature death before age 60.

8. Premature death has already been allowed for both in the end of life assumption and the 5% already applied. Further, there is also a discount factor in basing the calculation for lost earning capacity only on average earnings. Nevertheless, the net discount for loss of earning capacity to age 60 requires differentiation from other "end of life" allowances. I should have applied 7.5% rather than 5%. The allowance for future earnings should, therefore, be reduced to $596,105.00. The superannuation component should similarly be reduced to $23,764.00.

Lost years 9. The third defendant submits that a further allowance should be made for "deferred receipt" for 41 years of the lost earnings for five years.

10. The plaintiff agrees.

11. I therefore reduce the sum awarded from $56,000.00 to the figure the parties are agreed results from the correction suggested, namely $16,632.00.

Future Care 12. The assumed figure had been taken from the plaintiff's submissions of 9 October 1996. That, the third defendant submits, contained an error of calculation when compared with the reports admitted into evidence.

13. However, the third defendant then applies the same methodology to the figure provisionally awarded in the decision of 13 September 1996, to arrive at a result of $3,832,078.20.

14. The plaintiff contends that this figure omits an allowance for a gardener/handy man which would give, when included, a non-discounted allowance to age 60 of $4,285,968.00 prior to any applicable discount.

15. In view of this conflict, it is necessary to revert to a consideration of the documents admitted into evidence rather than the parties' construction of them. Accordingly, I have referred back to documents cited in the original submissions on damages and accepting at p25 (b) Future Care, scenario 6, exhibit 33, p11-12, the total for future care should be $4,012,345.00. There was, therefore, some degree of error in the calculations continued in the plaintiff's submissions on the effect of those documents.

16. The third defendant suggested an additional allowance should be made against this scenario to take account of the option of dispensing with part-time carers during hospitalisations. The allowance would be $39,391.62.

17. I think that such an allowance ought to be made.

18. However, the plaintiff had pointed out in its submissions that an allowance for a handy man/gardener had been omitted from the calculation contained in exhibit 33. The third defendant had submitted that the carers could perform that function so that no allowance was needed. I did not accept that. Four hours per week was regarded by me as reasonable. I intended an allowance for that service to be an element of "future care" (see plaintiff's submissions, p26 (c)).

19. Thus the sum of $128,949.00 should be added to the allowance for future care, being the offset remaining after the two allowances above are made.

20. That leads to an undiscounted estimate for future care taking account of the above corrections, of $4,101,902.40. The net discounted figure (5%) is $3,896,807.00.

21. That figure should be substituted for the sum of $4,071,670.00 originally awarded.

Credit Sums 22. I also note, in reviewing this figure, that I allowed $1,237.00 for interest on tube feeding costs. The evidence was that all those costs were met as incurred either by ACT Government or FaBRiC. Thus, interest should not have been allowed. That sum will also be credited to the defendant.

23. Interest was allowed on the sum awarded for past care. For interest purposes, respite care costs, otherwise previously paid for, were deducted. It was intended also that the sums paid to the plaintiff's parents or the plaintiff as child disability allowance and disability pension be removed from any calculation awarding interest. Because these allowances varied from time to time, the calculation of interest to be forgone was more complex than simply deducting the totals from the past care allowance less respite care ($24,240.00) from the allowance for past care. To have done so would have reduced the interest component, allowed at $583,950.00 to $524,360.00, a reduction of $59,590.00. However, to take account of the interest actually attributable to receipt of those payments when they were paid, though ignoring small increments, the calculation is as follows, Child disability paid instalments 1/1/78-28/5/92, total $15,597.60 Interest to 28/5/92 50% of $33,375.00 $16,687.50 Interest on $15,597.60 to judgment 13/9/96 $7,506.00 Invalid pension 4/6/92-13/9/96, total paid $39,461.60 Interest 50% of $18,990.00 $9,495.00 The total credit should, therefore, have been $33,688.50 I would allow a credit of $33,689.00 instead of the $46,535.00 originally allowed under this heading.

24. The Schedule of Damages should be amended therefore as follows, General damages $300,000.00 . Interest thereon for past component 38,000.00 Past treatment (excluding overseas doctors' fees) - . Woden Valley Hospital $41,193.20 . Drug expenses to December 1995 9,062.25 Interest from 5 August 1977 on paid past expenses 11,828.00 . Vitamins and food supplements 4,800.00 Interest thereon 6,265.00 . Hospitalisation, Woden Valley Hospital (not paid) 41,452.00 . Specialists fees (paid) 3,200.00 Interest thereon 4,177.00 . Ambulance costs, as claimed (paid) 2,530.00 Interest thereon 3,302.00 . Tube feeding - Past @ over and above normal feeding costs from February 1994 to December 1995 27,716.00 Less normal feeding 8,840.00 18,876.00 . Future tube feeding @ $407.00 for 41 years (Less contingencies at 5%) 479,446.00 . Less allowance for normal feeding costs ($100.00 per week for 41 years discounted by 5%) 120,200.00 359,246.00 Transport - . For necessary medical treatment (not including overseas) around Canberra 2,473.10 Interest thereon 3,228.00 . For general purposes (no interest claimed) 3,640.00 . For Sydney (no interest claimed) 7,650.00 . Overseas - 1982 - $11,950 + interest of $10,780 22,730.00 - 1988 - $7,865 + interest of $3,500 11,365.00 Future Treatment - . Future vitamins etc @ $5.00 per week 5,590.00 . Future medical care @ $12.00 per week 14,135.00 . Future hospital 28,025.00 Future transport - . Medical @ $2.00 per week 2,355.00 . General @ $35.00 per week 41,225.00 Future drugs @ $70.00 per week 82,455.00 Future Medical - @ $27.79 per week 32,735.00 Griffiths v Kerkemeyer - . Past care for full-time carer at commercial rates 452,989.00 Interest on $428,749 allowing for respite care costs paid of $24,240 583,950.00 . Future care adjusted to life expectancy of 60 years less contingencies @ 5% 3,896,807.00 Loss of earning capacity (no past element) . Future to age 60 at average weekly earning less contingencies @ 7.5% 596,105.00 . Additional employer funded superannuation component less contingencies @ 7.5% 23,764.00 Loss of expectation of life - . 12 years assumed 7,000.00 . Net loss of earnings during "lost years" 16,632.00 Future household renovations 469,250.00 Fund Management fees 250,000.00 $7,398,034.55 Allowances paid to or for plaintiff . Child Disability paid instalments 1/1/78-28/5/92, total $15,597.60 Interest to 28/5/92 50% of $33,375.00 16,687.50 Interest on $15,597.60 to judgment 13/9/96 7,506.00 . Invalid Pension 4/6/92-13/9/96, total paid $39,461.60 Interest 50% of $18,990.00 9,495.00 33,688.50 Credit for interest on sums received for disability and pension payments 33,689.00 NET TOTAL $7,364,345.55

25. The judgment entered for the plaintiff as at 13 September 1996 for $7,583,768.55 should therefore be amended to $7,364,345.55 and judgment for that sum is entered accordingly.