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Parente v Bell [1967] HCA 19; (1967) 116 CLR 528 (6 June 1967)

CATCHWORDS

Damages - Personal injuries - Economic loss - Admissibility of evidence - Possibility of continued inflation as factor in assessment.

HEARING

DECISION

2. The defendant is the father and administrator of the intestate estate of the deceased man. The case is within the original jurisdiction of this Court, as it was proved that the defendant is and was at all material times a resident of New South Wales, as was his deceased son ; and the plaintiff is, and when the action was instituted was, a resident of Queensland. (at p529)

3. At the outset I questioned whether the proceedings were maintainable having regard to s. 15D of The Common Law Practice Act (Q.), as amended by and affected by The Law Reform (Limitations of Actions) Act of 1956 (Q.). The action was not in fact commenced within six months after the grant of letters of administration to the defendant. It was, however, pointed out to me that the Supreme Court of Queensland had held in Minchin v. Public Curator of Queensland (1964) Qd R 545, at p 552 that the effect of the 1956 amendment was to enable an action of this kind to be brought at any time within three years of the cause of action arising. The question of statutory construction resolved in that way by that decision is unusual. I had at first thought that the effect of the amendment of s. 15D was not to alter the requirement that an action against a personal representative be brought within six months of the grant of administration. It is surprising that a personal representative should not know within some limited period of time of what claims there may be against the estate ; and I at first sight thought that the manner of the amendment in 1956 involved a recognition still of the executor's year. However, the reasoning of the judgment of the Full Court of Queensland is highly persuasive and, sitting as I am in Queensland to exercise the original jurisdiction of this Court, I think I need not further consider the question. As I said in the course of the proceedings I propose to follow the decision of the Supreme Court. Moreover it was not alleged in the pleadings that the action was out of time ; and it may be that even if the time limit of six months still prevailed it should be regarded as a procedural limitation which can be waived, not as an ingredient of the cause of action. (at p530)

4. It is admitted on behalf of the defendant that the accident occurred as a result of the negligence of the deceased man Bell. Contributory negligence on the part of the plaintiff was alleged. The parties are agreed that the action should be tried according to the law of Queensland, which enables apportionment of damages, and that the defendant is to be held responsible for 85 per cent of the damages which the plaintiff has suffered, the plaintiff bearing the remaining 15 per cent himself. The only task for the Court therefore is to assess the damages. (at p530)

5. The plaintiff is an Italian by birth, a migrant who came to this country some twelve years ago ; he is a married man, and was at the time of the accident living at Southport. He had left school in Italy at the age of fourteen and he had worked in a brickworks in Italy before coming to Australia. He is now aged thirty-seven. He learnt English after he came to Australia. He has now a good knowledge of English, grasping at once in the witness box the meaning of questions put to him, some of which were not simple. He has a good vocabulary, although a slightly uneven pronunciation. Altogether he is an obviously intelligent man who has learnt quickly to adapt himself to life in Australia. And I think he will learn in the future to adapt himself, as far as may be possible, to the new circumstances in which he is placed as a result of the accident. He has been a hard-working, conscientious man. He impressed me as being an intelligent, frank and reliable witness. In general I accept his evidence. Evidence was given by psychologists of his responses to various aptitude tests. This evidence confirmed me in the impression which I got from merely observing that in the box he is an intelligent man, quick in apprehension. It may be that his intellectual responses have in some respects become slower in some ways than they were before the accident. It may not be as easy for him, at his age and because of the accident, to acquire new skills as once it might have been. The evidence which the psychologist gave about this was informative ; but his conclusion is necessarily somewhat speculative. (at p530)

6. A scar on the forehead in a place which the plaintiff says is still painful to touch indicates that he had a head injury. But so far as I can judge there is no evidence from which I could conclude that he suffered any injury to the brain or that as a result of the accident there has been any significant diminution of his intellectual capacity. (at p531)

7. He has, however, suffered and still suffers from some mental or nervous effects from the accident - headaches, sleeplessness, and an impairment of his sense of smell. Some of these disabilities - perhaps not the impairment of the sense of smell - will, on the evidence and from one's ordinary expectation of what is likely to occur, diminish as time goes on, as increasingly he learns - using the common colloquial expression nowadays - "to live with" his disabilities and when the irritations and frustrations and worries which are the inevitable consequence of a serious accident and pending litigation diminish after these proceedings have terminated. (at p531)

8. His main injuries are physical. He has been seriously crippled. The actual injuries caused by the accident may be briefly described as follows : (at p531)

9. A compound fracture of the right upper arm ; a transverse fracture of the left leg ; a fracture of the heel bone of the left foot ; a fracture of the right thigh ; fractures of the right leg ; and lacerations, contusions and abrasions. (at p531)

10. He had some periods in hospital, during which for a long time he was in plaster and suffered much discomfort and pain. He now has the following disabilities which are all almost certainly permanent : (at p531)

11. A stiff right arm, with two fingers stiff and a right hand weakened so that its use is impaired. He cannot straighten his arm, and any attempt to do so he says gives him pain. The movement of his right leg greatly restricted, the right ankle having been immobilized and fused by an anthrodisis ; and a shortening of the right leg by about three-quarters of an inch. These mean, of course, a considerable loss of function in the limb as a whole. (at p531)

12. He uses a walking stick. Standing for any length of time on his right leg causes pain or, at least, discomfort. He says too that there are some tender spots in his left leg, and that the heel is tender. It seems that it may become necessary at some time in the future to fuse the left ankle joint and perhaps the right elbow to relieve his pain if that continues or gets worse. But these things cannot be regarded as being more than possibilities. (at p531)

13. Before the accident the plaintiff was employed as a tile layer by a stonework contractor in the Southport area. In the course of his work he laid pavement stones and did similar tiling and slate work, mainly in the open air. He was at first paid wages. Later and for some time before the accident he is described as having been a sub-contractor, which really means, I think, that he was paid so much per yard of pavement laid. Immediately before the accident he was earning an amount which probably can be taken as an average of $59 a week. He was working hard to achieve this. It may be that with practice his skill would increase and that working long hours he could have laid more stones, tiles or slates and earned more. However, in any consideration of the wages which can be earned in trades associated with the building industry some regard must be had to the fact that it is an industry in which there are booms and recessions in various localities. At the time at which the plaintiff was working building was going on vigorously in the Southport area. (at p532)

14. Since the accident it is quite impossible for the plaintiff to perform the sort of manual work which he did previously. His activities must now be confined to sedentary or semi-sedentary occupations. He has no experience or training for work other than of a manual character. He reads and writes in the Italian language ; but has no present proficiency for clerical work in English. However, I think he is capable of learning fairly quickly. I consider that although he might not find it easy to obtain work at once he is very far from being an unemployable person or a man who would be content to live in idleness for the rest of his life. He is not that sort of man. Since the accident he has been earning some money by means of a contract which he has to clean public telephone booths for the Postmaster-General's Department. This he accomplishes by driving his wife in a car - he is able to drive a car - from one telephone booth to another where she does the actual cleaning. No evidence was given of what he receives for this contract ; but there is no doubt that he does earn money. The fact that he does only part of the work, his part being driving his wife from place to place, and that she does the actual cleaning does not mean that he is earning nothing. (at p532)

15. A good deal was said to me about the manner in which I should estimate the damages which he has suffered by reason of his loss of earning capacity and limited opportunities of employment. Actuarial evidence was produced by Mr. Palmer, an actuary who came from Sydney. He produced a tabulation of present values of future weekly sums, calculated at 4 1/2 per cent and 5 per cent. He also set out, from the Australian Life Tables, the expected duration of the plaintiff's life and of his working life (assuming a working life until age sixty-five) and so forth. It was sought to get him to go further and give his opinion of the future purchasing power of money ; this is, to speak of currency values in the future. This evidence was objected to. It seemed to me that it would not be admissible ; but I thought it best to hear briefly something of it so that I might know of its nature before ruling on its admissibility. I think I should say that the witness based his conclusions on certain statistical material to be found in the Commonwealth Year Book. The value of this data for the purpose for which he used it was not, I think, established. No doubt it is a commonplace that the purchasing power of the currency has fallen and that as time has gone on that has been manifested in various ways, by increased commodity prices, by increases in the basic wage - when there was a basic wage. The witness said that his conclusion from his consideration of this material was that for the purpose of determining the present value of future weekly payments the calculation should be on a 3 per cent basis - instead of the figures of 4 1/2 per cent, 5 per cent, or 6 per cent which have been commonly used. This, he said, would take into account a continuing trend of decline in purchasing power. In my opinion evidence of the kind thus tendered is not admissible, for reasons which I shall give. I may say, however, that even if it were admissible I would put little, if any, weight upon it. I say that because the material on which Mr. Palmer based his conclusion is not in my view such as to enable anyone to make predictions which would be helpful for the determination of this case. It may be that, from the statistics he had which related to the last sixty years or so, a general trend can be perceived, and the purchasing power of money may be said to have declined. But it is well known that the economic history of Australia since about 1840, perhaps from an earlier date, has been marked by periods of booms and depressions. This makes me sceptical of any suggestion that I ought to assume that throughout the working life of this plaintiff there will be a continuous and uniform inflationary trend ; and that for it an allowance can be made in assessing damages for loss of the earning capacity which, had it not been for his injuries, the plaintiff could have exercised during that period. However, quite apart from misgivings about the value of the evidence if it were admissible, I consider that I must reject it. I say this for two reasons. First, it is put forward as the opinion of the witness. Now Mr. Palmer is an actuary. He is no doubt in some senses skilled in the evaluation of statistical data ; and he has given consideration to the matter on which his opinion was sought. But I am not persuaded that this qualifies him as an expert in economic prophecy. Secondly, and more fundamentally, it seems to me that the evidence was tendered upon a misconception ; and that, however qualified as a prophet a witness might be, it is not receivable. It is true that in the endeavour to estimate the monetary sum to be awarded to a plaintiff as damages to compensate him for the diminution of earning capacity it is common practice to take as an initial measure the difference between the wages the plaintiff was able to earn week by week before the accident and what he is able to earn thereafter. By calculating the present value of an assessed weekly future loss thus arrived at, a capital sum can be determined which, after adjustments and allowances for various contingencies, is commonly described as "economic loss". It is however misleading to regard this method of assessing compensation for the destruction, total or partial, of earning capacity as a means of providing a plaintiff with periodic payments in the future. Damages are estimated for a present loss, a loss of a capacity or faculty. They are measured in terms of the money values prevailing at the time of the award. The plaintiff can use or apply the sum he is awarded as he chooses. He can if he chooses invest it and obtain in present conditions a yield of considerably more than 3 per cent. He is free, if he wishes and his circumstances permit, to buy property which if the currency continues to decline in purchasing power will or may increase, more or less correspondingly, in monetary value. The present case is a good illustration. The present plaintiff does not propose to purchase an annuity with whatever sum he may be awarded. He proposes to put what he gets towards the purchase of a flat or flats at Southport which he and his wife will look after and let to holiday-makers there. (at p534)

16. In Murphy v. Houghton & Byrne (Q.) Pty. Ltd. (1964) QWN 14 , a decision of Gibbs J., and in Gollan v. Duncan (1961) NZLR 60 , a decision by Barrowclough C.J. in New Zealand, evidence such as it was proposed to get from Mr. Palmer was, after careful consideration, rejected. I respectfully agree in their Honours' view of the matter. No doubt the decline in recent times of the purchasing power of money and the fact that there is no present sign of a movement in the opposite direction affect, indirectly in various ways, the assessment of damages for personal injuries. Great caution must be used in any attempt to base a conclusion in a case to-day upon any memory or impression of what seemed to be the pattern of amounts awarded in cases assumed to be comparable which were tried twenty years ago or even much more recently. Dixon J. pointed this out in Lee Transport Co. Ltd. v. Watson [1940] HCA 27; (1940) 64 CLR 1, at p 14 . Lord Normand in Glasgow Corporation v. Kelly (1951) SC (HL) 15, at pp 18-20 , speaking in the House of Lords in reference to awards of solation under Scots law, mentioned the same matter, He added that no doubt also the recent expansion of the social services must be set against the depreciation of the pound sterling. Awards of damages are necessarily made against the background of to-day. Money buys less than in former times ; but some things which formerly had to be bought by the individual are now provided by the community. (at p535)

17. It is of course impossible to forecast with any assurance what the future holds for this plaintiff. It is impossible to estimate, in rigidly separate compartments, compensation for the total effect of his injuries. The conventional headings of economic loss, pain and suffering, what is called lack of amenities and possible future expenses which he may have to meet in consequence of his disability may be considered separately, but they merge one with the other, and each of them has some bearing upon the others. (at p535)

18. Doing the best I can, I consider that this plaintiff has suffered damages which should be assessed at $33,216. Eighty-five per cent of that sum is, according to my calculations, $28,233.60. (at p535)

19. For the information of the parties and without saying that I have rigidly separated these matters into compartments, I would add that - having regard to the evidence, such as I have, of the plaintiff's earning capacity in the past and making the best allowances and adjustments I can for the possibilities of the future and what would have been his prospects had he not been injured - I have estimated the economic loss, that is to say damages for loss of earning capacity, at $26,000 or thereabouts. So far as I have engaged in calculations I have adopted a figure of 5 per cent. The rest of the sum is made up of damages for his sufferings of a more general character. I have allowed, although little was said about this, for the possibility of future medical costs, in so far as they may fall upon the plaintiff rather than upon the State. (at p535)

20. I have allowed the following items of special damage which were claimed and not objected to : destruction of the plaintiff's vehicle, moneys which he had to pay to the Queensland Ambulance Transport Board, loss of clothing as a result of the accident, some amounts for pharmaceutical expenditure in the past as claimed, and for taxi fares he had to pay in order to visit the Southport hospital. (at p535)

21. Such a judgment, of course, carries the costs. In the present case the parties made a commendable effort at agreeing on a variety of matters and obviated the necessity to call some medical witnesses. Medical certificates were admitted. However, I do think that there was no justification for calling Mr. Palmer, the actuary from Sydney. As I have said, evidence he was called to give was not admissible. I had said before he came that I questioned its admissibility ; and the decision of Gibbs J., of which I did not then know but counsel I assume did, supported this view. The defendant was prepared to admit the certificate Mr. Palmer gave. (at p536)

22. My judgment is that the plaintiff recover from the defendant $28,233.60 and the costs of this action other than the costs of the witness Palmer, except such costs as were incurred in obtaining his certificate. I make the usual order as to exhibits. (at p536)

ORDER