Hall v State of New South Wales

Court of Appeal (NSW)|2014-05-13|Before: Meagher JA, Leeming JA, McDougall J

Judgment 1MEAGHER JA: I agree with Leeming JA. 2LEEMING JA: The only issues arising on this appeal concern the finding by the primary judge that non-economic loss was 25% of a most extreme case, for the purposes of s 16 of the Civil Liability Act 2002 (NSW). The appellant contends for a finding of 40%. Her appeal is as of right, because a finding of 40% would increase the damages to which she was entitled by more than $100,000: Supreme Court Act 1970 (NSW), s 101(2)(r). 3The appellant's amended notice of appeal raises three grounds: (1) whether the finding of 25% of a most extreme case was "outside a sound discretionary range", (2) whether the primary judge adequately explained his reasoning process, and (3) whether the primary judge erred in finding that the appellant would be greatly assisted by the conclusion of this litigation. 4When the appeal was heard, the grounds of appeal were, helpfully, narrowed. The third ground became very much the principal ground, and its gravamen was that there was no evidence to support a finding that the appellant would be greatly assisted by the conclusion of litigation. The second ground was confined to a challenge to the reasoning process underlying the finding challenged by the third ground. The first ground was confirmed to be consequential upon the others. The first respondent tailored its submissions accordingly. 5I propose that the appeal be dismissed. My essential reasons are that there was no error in finding that the appellant would be "greatly" assisted by the conclusion of the litigation, and in any event, on a fair reading of the reasons, the challenged finding of fact played no part in the s 16 finding of 25% of a most extreme case.

(a) Applicable principles 28The starting point must be the principles applicable to a challenge on appeal to the finding of 25% of a most extreme case. Contrary to what was common ground between the parties, the better view is that s 16 calls for no exercise of "discretion" such that its review is governed by the principles of House v The King (1936) 55 CLR 499. As much appears from the language and structure of the provision. Section 16 does not confer a discretionary power. Instead, it imposes an obligation to determine the severity of the appellant's non-economic loss and to do so by reference to a proportion of a most extreme case. 29The purpose is to replace the former process of awarding a money sum by way of general damages by an obligation to evaluate the severity of the non-economic loss by reference to a proportion of a most extreme case. That proportion is, by the operation of statute, translated into a monetary amount. The appellant advanced, or came close to advancing, the submission that the Court should look through s 16 and approach the exercise by reference to the dollar amounts which correspond to the various percentages. That submission is readily rejected. To adopt it would be to subvert the statutory scheme and would be legally erroneous: Clifton v Lewis [2012] NSWCA 229 at [57]. 30The position was described by Basten JA in Berkeley Challenge at [13]: "The importance of the distinction is that the assessment of general damages, now being reduced by statute to a determination of the severity of the injuries as a proportion of a most extreme case, involves no translation of pain and suffering into a cash payment, but is rather to be compared with the assessment of the restrictions imposed by the injuries on the plaintiff's pre-existing earning capacity. On this approach, the assessment of non-economic loss is not to be seen as analogous to a discretionary judgment, but rather to be subject to the general principles for appellate review articulated in Warren v Coombes. That means that if the appellate court's assessment of the facts satisfies it that the conclusion reached by the trial judge is erroneous, it should not shrink from substituting its own opinion for that of the trial judge. If that conclusion permits of a higher level of intervention in respect of such awards, that is because of the significant change which has been made from the common law principles governing general damages. 31It is true that some authorities in this Court refer to s 16 as involving an exercise of discretion: see for example Berkeley at [79] and Coles Supermarkets Australia Pty Ltd v Haleluka [2012] NSWCA 343 at [32]. However, those authorities do not go so far as the parties to the present appeal ventured, which was to accept that House v The King error needed to be established. What those authorities do clearly establish is that the determination is "neither scientific nor normative" and is "not readily susceptible to appellate review": see Crystal Wall Pty Ltd v Pham [2005] NSWCA 449 at [49]; Wynn Tresidder Management Pty Ltd v Barkho [2009] NSWCA 149 at [110]-[111]; Withyman v State of New South Wales [2013] NSWCA 10 at [146]. That is plainly so. The key to the meaning of the description of the task as "discretionary" may be seen perhaps most clearly in the often cited proposition in Dell v Dalton (1991) 23 NSWLR 528 at 533 that the assessment involves matters of "opinion, impression, speculation, and estimation". I respectfully agree with McDougall J's observation that "to say that a determination of non-economic loss involves more art than science might be to overstate the degree of logic and precision with which such an assessment is performed": Jopling v Isaac [2006] NSWCA 299 at [24]. Nevertheless, while fully acknowledging its inevitable imprecision, the task remains conceptually distinct from the exercise of a discretionary power, and its review on appeal is subject to different principles. 32The primary judge was not called to exercise a discretionary power, but instead had to make a finding of fact, namely, the severity of non-economic loss by reference to the proportion of a most extreme case. Ordinary principles of appellate review apply to that finding. That said, the intrinsically imprecise nature of the statutory task will have the effect that in many if not most cases, nothing will turn upon the different formulation of the applicable principles of appellate review. In this respect, the position is as stated by Spigelman CJ in Perpetual Trustee Company Ltd v Khoshaba [2006] NSWCA 41 at [40]: "Where, as here, the first statutory step is clearly a finding of fact, albeit one involving a broadly based value judgment, it may be that the Court should invoke the principles reflected in Warren v Coombes (1979) 142 CLR 531 rather than in House v The King. Nevertheless, in most cases it is unlikely that the different tests will lead to different results." 33This is such a case; nothing turns on the precise test to be applied in order to reject each of the grounds raised by the appellant.

(b) Error in finding that appellant would be "greatly" assisted by the litigation ending? 34The primary judge, at [115], after dealing with non-economic loss and expressly for the purpose of calculating future out-of-pocket expenses, found that compensation should be awarded based on a further 10 years of treatment. No challenge is made to that finding, which was supported by the evidence. One of Dr Short's reports in 2010 included that he would anticipate treatment continuing "for perhaps the next 10 years". In 2012 Dr Short said she would require "very long-term psychotherapy" and imagined that she would continue to see him and a psychologist for a further five years. 35In the course of dealing with this head of damages, his Honour said: "There is no doubt, however, both from the plaintiff's evidence and that of [Dr Short], that the conclusion of legal proceedings will greatly assist the plaintiff in dealing with her predicament. As Dr Short said, it is unusual for there to be such intensive treatment over a long period of time." 36The appellant says that that finding is plainly wrong, and that it may be inferred that it influenced the finding of 25% of a most extreme case, since it is located only two paragraphs beyond it, thereby entitling this Court to redetermine the matter. I respectfully disagree. 37First, the finding is not plainly wrong. To the contrary, it is supported by the evidence. As noted above, the appellant herself acknowledged the increasing anxiety she had felt as the hearing approached. True it is that the appellant denied that it would be possible for her to enhance her quality of life once the case was over, but it was open to the primary judge to discount that (necessarily speculative) evidence, especially in light of the evidence of Dr Short, about her "absolute horror" of the litigation. Further, it is evident from the transcript that when giving evidence in chief, the appellant became tearful. Added to the testimonial evidence is the obvious advantage enjoyed by the primary judge to make a finding such as this, which is implicit or explicit in many of his findings (the way she gave evidence, the "compelling impression I had of the appellant", and, perhaps, the statement that "she is not entirely without a sense of humour"). 38The appellant confirmed that no challenge was made to the finding that the end of the litigation would assist her; the challenge was confined to the finding that she would be greatly assisted. But that was an evaluative conclusion supported, in particular, by Dr Short's evidence extracted above, and to which this Court must give considerable deference to the primary judge who saw her give evidence. 39Secondly, even if the finding were wrong, it did not undermine the finding of 25% of a most extreme case. The structure of the reasons of the primary judge provided no support for any such inference: his Honour having dealt with non-economic loss had passed to a different head of damages. Indeed, the premise of the calculation of future out-of-pocket expenses was the existence of some continuing psychological condition requiring treatment. In short, there is nothing in the paragraph which looks forward to a finding not yet made in order to inform the conclusion of 25% of a most extreme case. For that further reason, this ground is not made out.

(c) Failure to give reasons? 40The appellant in oral address confined this ground to the inadequacy of reasons for the first sentence of [115]. For the reasons set out above, the finding of 25% of a most extreme case is independent of the finding for which reasons are said to be inadequate, and the finding is in any event sound. This ground cannot advance the appellant's position, and it is accordingly unnecessary to say anything more of it.

(d) Finding of 25% of a most extreme case outside a sound discretionary range? 41As noted at the outset, the appellant conceded that this ground was derivative upon the principal grounds advanced; accordingly, it is unnecessary to say anything further in relation to it.

Orders 42For those reasons, I propose that the appeal be dismissed. There is no reason for costs not to follow the event. 43McDOUGALL J: I agree with Leeming JA.

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