CTHHCA

Jones v Schiffmann

[1971] HCA 52

High Court of Australia|1971-07-01|Before: Walsh JJ

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Source facts

Court

High Court of Australia

Decision date

1971-07-01

Before

Walsh JJ

Source

Original judgment source is linked above.

Judgment (38 paragraphs)

[1]

High Court of Australia Barwick C.J. McTiernan, Menzies, Owen and Walsh JJ. Jones v Schiffmann [1971] HCA 52

[2]

In the trial of an action at common law in the Supreme Court of New South Wales, a verdict was given in favour of the respondent for the sum of $10,000. Upon an appeal to the Court of Appeal Division, that Court [1] increased the amount of damages to the sum of $20,000. The appellant now seeks in this Court the restoration of the trial judge's verdict.

[3]

The respondent's husband was killed as the result of the appellant's negligence. The task for the learned trial judge was the assessment of the financial loss suffered by the respondent by reason of her husband's death. They had been married some eight years during which time they were paying off amounts due on the house in which they lived. They were both in good health but childless. The deceased was in the employ of the Commissioner for Railways in New South Wales. He earned at the time of his death $68 per week after appropriate deduction of income tax. The respondent had taken employment, sometimes working full time and sometimes part time. When working full time she was paid $30 per week after due deduction of income tax and $25 per week net after tax when working part time. They pooled their earnings, expending therefrom their household and personal expenses and their outgoings on the house. What was left they saved. At the date of the death of the deceased, he was thirty-four years of age and the respondent thirty. His employment was secure. He was entitled to superannuation. But he had no real prospect of advancement in the Commissioner's service.

[5]

The trial judge's award was, in my opinion, low, although the sums he had to deal with were relatively small. It could be regarded as parsimonious; but parsimony is not in itself, error. The husband and wife were young and had a long joint expectancy, subject of course to those hazards embraced in the expression, the vicissitudes of life. Unemployment, ill-health, accidental death, or injury in circumstances which did not produce compensation are realities of life of which substantial and not merely nominal account must be taken. There is no warrant, in my opinion, for requiring the defendant in an action for damages for personal injury to provide the plaintiff with a certainty and security for life or for some period of it in replacement of the uncertain and unsure situation in which that plaintiff may have been. The task of assessment is most difficult. Necessarily it is an exercise of judgment, after consideration of all relevant factors. Where financial loss is the subject of assessment in a case such as this it is no doubt useful, if indeed not necessary to form some opinion as to weekly benefit expressed in money terms of the husband's co-existence with his wife, as some basis for estimating that loss. But when an opinion has been formed as to such a sum, the value of the loss of the prospect of continuance of that support is not in my opinion properly estimated by any multiplication of that sum, or by any multiplication followed by some discounting process. Further, before any total sum is arrived at it must be borne in mind that the payment of that sum provides a capital sum capable of investment. No doubt with proper advice, its investment may increase it as well as provide income by means of it. Whether in particular circumstances, having regard to the amount of the sum, or the position of the recipient such a consequence is likely to ensue is of course a matter for consideration by the judge. But, in my opinion, the duty to both parties in the assessment of damages is not performed unless these matters are duly considered.

[22]

Was this the case? I have, with some hesitation, come to the conclusion that it was. The husband was but thirty-four years of age when he was accidentally killed; the widow was then thirty years of age. They had been happily married for eight years. They were both in good health. The husband was in a secure job earning $68 weekly after tax. He was employed by the New South Wales Railways Commissioner as a driver and, although it was unlikely that he would obtain any higher classification, his job was certain and carried superannuation and other rights. It appears that the couple lived modestly, that they were buying their home and were saving to better their circumstances. On these facts I think the award of $10,000 for general damages was so small that it must have been the result of some error on the part of the learned trial judge. It was, therefore, a case in which I think the Court of Appeal was justified in setting aside the damages awarded and reassessing damages. This they did at $20,000 for general damages. This figure was reached, so far as I can ascertain, on the basis that the learned trial judge would have awarded some such sum if he had not given too much weight to the widow's prospects of an advantageous marriage. As I have already said, there was no basis for so pin-pointing the error which I think must have occurred. Like the learned trial judge, the Court of Appeal did not indicate how the award for general damages, which it made, was reached. It is reasonably clear, however, that their Honours reached their assessment on the footing that the widow's marriage prospects were of little or no significance in assessing damages. In this I think that their Honours were wrong. They did not have the advantage, which the learned trial judge had, of seeing and hearing the widow. Their Honours must, I think, have adopted the general proposition that prospects of re-marriage should be given but little weight and applied this proposition to a case in which the learned trial judge had attributed more than little weight to those prospects.

[32]

If there were full dependence of a widow in the same general situation as the plaintiff and her husband as to their ages, his earnings, his secure work history and secure employment a verdict well in excess of $20,000 would be called for, if no rebate for the chance or remarriage were allowed for. Some support for such a conclusion is to be gained from the guide provided from any one of a number of relevant arithmetic calculations. For example the arithmetic equivalent of half the husband's wages for twenty-five years at six per cent is approximately $25,000. This of course, omits reducing contingencies, except to the extent that it is based on the husband's working life and dependence upon him continuing only to fifty-nine. His Honour, rather than requiring the detail of division of earnings, suggested to the plaintiff that she and her husband benefited equally from the family moneys. To this she assented. If this were so, her loss would be greater than half as some benefits would be jointly shared, such as electricity, rates and essential house and furnishing expenses. On the other hand, as against this, of course, if it be presupposed that probably a child would be adopted and that the plaintiff would not work, expenses in respect of the child would reduce to some degree the plaintiff's share in the husband's earnings for a substantial part of the period of dependence. From these observations it appears clear that the smallness of the verdict, in relation to the matters just referred to, can only be accounted for by a very large deduction in respect of the prospect of remarriage. The prospect of some earnings and a not very great diminution in dependence on this account, in the way dealt with by his Honour would not and, as the terms of his judgment indicate did not, account for the apparent substantial deduction. There are some matters in the foregoing passage which may be questioned. But subject to some qualifications I accept it as setting out a view of the facts which the Court of Appeal might properly have adopted. The statement that the arithmetical equivalent of half of the husband's wages for twenty-five years at an interest rate of six per cent is approximately $25,000 is somewhat generous to the respondent. Her husband's wages were said in evidence to be $68 per week, although the document setting out the wages indicates that they were somewhat lower than that. If the figure of $35 per week is taken as half the wages, the present value equivalent of that sum for twenty-five years at an interest rate of six per cent is a little over $24,000. But no doubt it may be said that on the assumptions made by Moffitt J.A., the starting point for a computation of damages based on calculations of that kind would be "well in excess" of $20,000. 1. (1970) 92 W.N. (N.S.W.), at p. 786.

[34]

The fact that the respondent was not wholly dependent on her husband could be properly taken into account in assessing her damages. But in the circumstances it seems right to conclude that it ought not to have been regarded as an important factor. I think, therefore, that it does appear likely that a substantial reduction in what otherwise would have been awarded was made because of the capacity of the respondent to remarry and of her prospects of doing so. As I have said, I think that it is not possible to decide what was the amount which the trial judge allowed for this aspect of the case. Indeed it would be speculation to assume that he arrived first at a figure without taking that factor into account and then made a specific deduction for it. I think it does appear, however, that his Honour's view as to the prospects of the respondent's remarriage must have caused him to arrive at a verdict much lower than the sum which otherwise would have been awarded. But what is important for present purposes is that, in my opinion, the award, considered in relation to all the circumstances of the case, was so low that it was proper for the appellate court to intervene. I am of opinion also that the amount at which the Court of Appeal assessed the general damages was a reasonable assessment of the financial loss suffered by the respondent. In reaching that conclusion I take into account as a significant factor in the case her freedom to remarry. But effect must be given also to the probability that if her husband had not died she would have become dependent to a greater degree on his earnings than she had been in the past and to the circumstance that she might soon have become wholly dependent on them. Although his prospects of advancement were not good his employment was secure. Having regard to what had occurred during the married life, it would be reasonable to conclude that she would probably have benefited to the extent of not less than half his earnings and that those earnings would probably have continued to be available for twenty-five years. In addition it would be necessary to take into account the possibility that she might have continued to receive further support from him for a considerable period beyond twenty-five years and this would be a factor to be offset against the unfavourable contingencies of unemployment, illness and premature death.

Jones v Schiffmann - [1971] HCA 52 - HCA 1971 case summary — Zoe