The term "permanent loss compensation" is defined to mean compensation under Division 4 of Part 3 of the Act (see s151A(1)), which includes compensation under ss66 and 67. Accordingly, if this provision were applicable, the right of the Appellant to recover damages was lost either upon accepting payment of compensation pursuant to the agreement made on 31 May 1999, or, if this occurred, by the Compensation Court making an award, on that date.
135 Amendments to s151A made by the 1998 Amendment Act did not apply in respect of awards of compensation made by the Compensation Court in connection with proceedings instituted before the commencement of the amendments on 1 August 1998. Accordingly, assuming an award was made on 31 May 1999, the proceedings having been instituted before the relevant date, the old section continued to apply. Because the parties assumed the correct date was 31 May 1999, I will assume that an award was made, presumably by consent, by the Compensation Court at the hearing listed on that day.
136 In Dunn v Firth [2003] NSWCA 280, Beazley JA noted at [11] the finding of the trial judge that had the appellant been advised "that the prospects of success were 50% or better the appellant would have made an election and sued at common law". Her Honour noted that findings with respect to causation were not challenged. However, as Davies AJA noted, concurring, had the appellant been advised "that the prospects of recovering substantial damages were so small and the costs and difficulties of a common law trial so great that common law proceedings ought not to be instituted", he thought she would have heeded the advice: at [72]. Commonsense suggests that this is correct and that, in order to know what a plaintiff would do, if given advice with respect to a common law claim, it is necessary to identify each of the relevant considerations, including the value of workers compensation payments which would be deducted or would cease; the chances of proving negligence and the likely damages if a claim were successful.
137 In the present case, the trial judge appears to have been content to assume that, if a significant benefit were available, on the basis of a common law claim, the Appellant would have opted to proceed with such a claim. On one view, in the absence of evidence from the Appellant as to what he would have done, had he been given information of the kind before the Court in the present proceedings, it may be difficulty to be satisfied on the balance of probabilities of the relevant causal connection. On the other hand, the test of causation is ultimately one to be determined on all the relevant material and not merely upon the assertion of the plaintiff as to what he or she would have done in hypothetical circumstances. Indeed, an appropriate assertion may, of itself, carry little weight: see, eg, Rosenberg v Percival (2001) 205 CLR 434 at [15]-[17] (Gleeson CJ); [44]-[45] (McHugh J); [86]-[87] (Gummow J); [157]-[158] (Kirby J) and [221] (Callinan J), dealing with the course a patient would have taken if warned of the risks of a proposed operation.
138 In the present case, the trial judge assessed damages largely in accordance with the report provided by Mr Buckley, on behalf of the Appellant. According to the plaintiff's schedule of calculations, which were ultimately not adopted by his Honour because of the reversal of his conclusion as to liability, the indications given in the first judgment would have resulted in a judgment in favour of the Appellant of approximately $100,000. On its face, it would seem that a reasonable likelihood of such a recovery would be a sufficient base from which to infer that the Appellant would have chosen to preserve his common law rights, had he been given the option.
139 At [107] above Tobias JA concludes, at (d) and (f) and (h) that the trial judge was in error in failing to make findings as to what the advice would have been, and what the Appellant's response would have been with respect to the advice. In my view, if his Honour's assessment, as made in the first judgment, is substantially accepted, the relevant inference may be drawn and there would be no need for the matter to be remitted for a further trial to address that issue. However, it is necessary to consider whether the complaints made by the Respondent as to the plaintiff's schedule have substance.
140 The most significant departure from the plaintiff's assessment, as submitted by the Respondent, is the need to remove from the calculation of notional damages an amount on account of interest for a period just short of four years from the date of the notional trial for common law damages on 1 September 2000, until the date of judgment on the claim against the Respondent, being an amount of $92,686. Prior to the addition of that amount, the damages calculated by the plaintiff were $337,000, but the allowance for past and future workers compensation deductions was a fraction under $330,000. Thus, unless the interest payment were to be added to the amount of damages prior to deductions, the common law claim would have been virtually valueless. (The first judgment is silent as to whether such an amount should have been included.)
141 The Respondent makes other complaints about the calculations undertaken by the primary judge or by the Appellant, but, with one exception, they are not critical for the purposes of the present argument. Thus, the most significant challenge, after the interest claim, concerns the reduction of future workers compensation payments by an amount of 25% for vicissitudes, being the same figure adopted in relation to future economic loss. As the Respondent noted, there is no reason why those figures should be the same, although it does not follow that they may not be: see Tipper v Williams (No. 2) (Court of Appeal, 6 May 1994, unreported). The effect of adopting a lower figure in relation to future compensation payments (15% being suggested) would be to increase the deduction by $25,000. However, if the Respondent were unsuccessful on its interest argument, there would still be an amount of damages in the order of $75,000 payable to the Appellant. The interest calculation is therefore critical to the outstanding issue of causation.
142 The submission made by the Respondent was that interest should only have been awarded after the calculation of damages had been assessed and workers compensation entitlements deducted. That was said to follow from the judgment of James J in Valmas v Nyman (12 November 1996, unreported) and the decision of the Queensland Court of Appeal in Green v Berry [2001] 1 Qd R 605 at 619 and 633. However, a reading of the table set out in Valmas (at p 43 of Butterworths unreported cases) suggests that his Honour included interest on past loss of earning capacity and past general damages, before making the deductions on account of workers compensation payments. On the other hand, what appears not to have been awarded was an amount of interest on account of future loss of earning capacity.
143 In Green v Berry, a question was raised as to the calculation of damages on a notional basis, but the issue of significance addressed by Pincus JA (at 619) (McMurdo P agreeing) and by Jones J (at 633) was whether an allowance should be made for the risk of failure before or after the deduction of workers compensation and social security payments. Reference was made in that context to the decision of this Court in Scott v Echegaray (1991) Aust Torts Rep ¶81-120, it being noted in Green at [97]-[99] (by Jones J) that the precise point in issue in Green was not there considered. At [38], Pincus JA expressed the view that, if Scott was authority for the proposition that damages should be assessed on a 50% chance of success whilst discounting on the basis of 100% chance of losing a workers compensation payment, that result was to be doubted: at [38]. This is a different issue.
144 In my view neither the plaintiff's assessment of interest, nor the Respondent's total removal of the item for interest is correct. Rather, the notional assessment of damages at the hypothetical trial against the employer should include pre-judgment interest from the date on which the cause of action accrued until the date of judgment, on so much of the award as reflected past loss, this being the calculation undertaken by James J in Valmas. Indeed, it would seem that the calculation should be restricted to interest payable for past loss other than that assessed pursuant to s 151G. In relation to non-economic loss assessed under that provision, no pre-trial interest was permitted, by virtue of the prohibition in s 151M(3), as in force prior to its repeal by the Workers Compensation Legislation Further Amendment Act 2001, Schedule 1.1, item [11]. That repeal commenced on 27 November 2001, well after the date of the notional trial. (In relation to the relevant transitional provision, see Schedule 6, part 18C, clause 9.) Accordingly, the calculation should be limited to the amounts of past economic loss identified by the plaintiff (including an amount pursuant to the principles in Fox v Wood and for superannuation) being a total of $79,764. In the present case, the cause of action was treated as accruing on 31 May 1999, the date of the notional judgment being 1 September 2000. Thus an allowance should be made for interest at 9.6% on those payments which had notionally been outstanding for 15 months less tax. This figure would be an amount of less than $10,000, if the bases of calculation otherwise remained the same.
145 I also accept that the judgment below must be assessed on the basis of the loss of a chance of bringing successful proceedings against the employer. In this context, "success" involves, as Tobias JA has explained, assessment of non-economic loss at a level which exceeds the relevant threshold for that form of damage and also, given the circumstances, exceeds the threshold which would permit the award of economic loss. The trial judge did not undertake such a calculation, but neither did he find that success was inevitable. Indeed, on the evidence, the latter finding would have probably been unsustainable. It follows that whatever award was calculated on a notional basis, it should properly have been discounted by a least 20% and probably by a considerably higher figure.
146 The evidence in the present case demonstrates that the Appellant was by no means inclined to accept what he perceived to be an inadequate sum of money in place of his weekly payment entitlements. Thus, believing the value of a commutation payment should have been of the order of $120,000, he rejected an offer of $70,000. Given that he placed such a value on his future workers compensation payments, it is reasonable to infer that he would not have forgone those payments for an amount of general law damages which, had he been properly advised on the basis of a full medico-legal assessment of the kind presented to the trial judge, would be likely to result in the payment of less than $10,000.
147 For these reasons, although the trial judge made identifiable errors in the approach adopted, the result did not involve a miscarriage and accordingly there should be no retrial.
148 Before leaving this conclusion, it is necessary to note the additional errors identified by Tobias JA at [107] above to determine whether they impact on the conclusion that there has been no miscarriage. Paragraphs (a)-(c) concern the responsibility of the Respondent "to take reasonable steps … to ensure that the appellant did understand the advice he was receiving" and his Honour's dismissal of the conclusion that he did not understand what he was being told.
149 With respect, I think the statement of the test overstates the principle identified by the President in Burt v Ware (Court of Appeal, 28 October 1998, unreported). Burt was a case in which the appellant solicitor had demonstrated to the satisfaction of the trial judge that his client had been given clear advice not to accept a settlement, which both solicitor and counsel considered manifestly inadequate, in circumstances where he had signed a settlement sheet which acknowledged that he had been advised that "under no circumstances should the above offer be accepted". His Honour had upheld a claim in negligence based on the sole ground that the written advice did not include the proposition, which was referred to orally, that acceptance would extinguish his rights to workers compensation. It was in that circumstance that the President stated, in what must be considered the manner most favourable to the client, the duty of care. Nevertheless, his Honour's conclusion, contained in the sentence which immediately follows the passage set out at [86] above read as follows:
"Here such care was taken, or to put it more correctly, it was not established that there was a lack of care in circumstances where the advice was orally conveyed immediately prior to the settlement instructions being taken."
150 In any event, the precise formulation of the test is less important than the comment of the trial judge that any lack of full and complete understanding on the part of the Appellant was "beside the point". In my view, there are two responses to this complaint. First, the intended meaning must be that, because the advice was not negligent and because the Appellant accepted it, it did not matter that he may not have fully understood its purport. No doubt a different conclusion would have been reached if either the advice had been negligent, or the Appellant had not followed it. Secondly, if the advice was properly conveyed, with reasonable care, so that it could be understood, the fact that the recipient may not have understood it would not be sufficient to demonstrate the negligent provision of a service. In any event, whether or not his Honour intended to convey either of these meanings, it does not affect the approach relied on above, which assumes that there was negligence on the part of the solicitor.
151 In relation to paragraphs (d), (e) and (f) at [107] above, I have assumed, in the Appellant's favour, that he would have given appropriate instructions, if there had been shown to be a realistic chance that he would have been significantly better off by doing so. Further, in relation to paragraph (h), I have assumed, again in favour of the Appellant, that the solicitor should have retained a medico-legal consultant and obtained further medical evidence, of the kind which was in fact tendered to the trial judge.
152 At [112] Tobias JA further notes the Respondent's complaint that a calculation of future economic loss was undertaken on the basis that there were neither reasons nor evidence to support the on-going impairment of earning capacity in the amount of $250 per week. I would agree with his Honour that the assumption of that figure demonstrates error and that the correct figure could only have been lower. That conclusion provides significant support for my own view that there has been no miscarriage in the present circumstances.
153 If the judgment in favour of the solicitor is maintained, it follows that the judgment in favour of the barrister must also be correct. Accordingly, in my view the appeal and cross-appeal should be dismissed with costs. Neither the cross-appellant nor the cross-defendant sought to impose any cost liability on the Appellant in respect of the cross-appeal and accordingly, the cross-appellant (the solicitor) should pay the cross-respondent's costs of the cross-appeal.
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