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[1990] HCA 20
appellant. Appeal allowed with costs. Orders of the Full Court varied by setting aside the award of $36,928.47 and substituting an order that the plaintiff recover such sum as assessed by the Master in...
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The High Court held that when working out compensation for injury, judges must treat real past events as either definitely happened or definitely not happened according to whether they are more likely than not. But for things that might have happened in the plaintiff's life if the injury had not occurred, or that might happen in the future, the court must estimate how likely they were and reduce or increase the compensation to match that likelihood. In this case the plaintiff's brucellosis from work negligence caused a serious neurotic condition that stopped him working. He also had a bad back that was not the employer's fault. The lower courts had decided that because the back would probably have made him unemployable anyway by 1982, he should get no money for lost earnings after then and very little for ongoing pain or his wife's care. The High Court said this was wrong: even if it was more than 50 per cent likely the back would have caused the same problems, the plaintiff should still receive damages reduced by that percentage chance rather than nothing. The case was sent back to be properly recalculated using these probabilities.
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The plaintiff, Mr Malec, worked as a labourer in the defendant's meatworks between October 1972 and April 1980. In the course of that employment he contracted acute brucellosis, a disease acquired from animals, as a result of the defendant's negligence. One recognised sequela of brucellosis is depressive illness; another is an organic condition producing a degenerative-like spinal state. The trial judge (Carter J.) found that the plaintiff had contracted acute brucellosis between 1975 and 1977, that the condition was no longer present by June 1983, and that a neurotic illness diagnosed in 1979 had been precipitated by the brucellosis. However, his Honour was not satisfied that the plaintiff's cervical and lumbar spinal symptoms, present since at least 1982, were caused by the brucellosis. He further found that the neurotic condition from which the plaintiff suffered at trial in September 1987 was probably not related to the 1975–1977 brucellosis episode. That last finding was overturned by the Full Court of the Supreme Court of Queensland, which held unanimously that the plaintiff's neurotic condition at trial was caused by depression induced by the acute brucellosis.
The majority of the Full Court (Matthews and Ambrose JJ.) went on to hold that, by reason of the plaintiff's personality, it was likely that the development of symptoms from his deteriorating back condition would have produced a similar neurotic condition even if he had never contracted brucellosis. They expressed the view that, quite apart from brucellosis, by age forty-four the plaintiff would have become unemployable as a result of his back condition and would have developed a similar neurotic condition. At trial the plaintiff was forty-nine. Accordingly the majority limited damages for economic loss to the period ending in May 1982. They awarded $15,000 for pain and suffering, apportioning $12,000 to the pre-trial period and only $3,000 post-trial, and refused any award for the care and attention provided by the plaintiff's wife on the basis that, by mid-1982, any such care was unrelated to the brucellosis or its attendant neurosis.
Carter J., dissenting in the Full Court, would have assessed damages on the footing that the neurotic decompensation caused by brucellosis would continue and would render the plaintiff unemployable for the foreseeable future. His Honour considered that two discounting factors had to be taken into account: first, that some symptoms were referable to the unrelated spinal condition, and second, that the plaintiff's personality made him vulnerable to psychiatric disability from other events. Carter J. would also have awarded $70,000 for gratuitous care under the principle in Griffiths v Kerkemeyer.
The High Court (Brennan, Deane, Dawson, Gaudron and McHugh JJ.) allowed the plaintiff's appeal. The joint judgment of Deane, Gaudron and McHugh JJ. (with which Brennan and Dawson JJ. agreed subject to brief observations) held that the majority had erred in refusing any damages for economic loss after May 1982, in their approach to pain and suffering, and in denying damages for care. The Court set aside the Full Court's award of $36,928.47 and remitted the assessment to the Master to be carried out in accordance with the High Court's reasons, the evidence, and (subject to those reasons) Carter J.'s findings, while treating the majority's view that the back condition would probably have rendered the plaintiff unemployable from 1982 as guidance on the relevant chances. The costs limitation imposed by the trial judge was also removed.
The High Court's reasoning rests on a fundamental distinction between the treatment of past facts and the treatment of future or hypothetical events. Once liability is established, a court ascertains whether an event has occurred on the balance of probabilities. If it is more probable than not that the event occurred, the court treats it as certain; if less probable, it treats it as not having occurred. This produces an all-or-nothing outcome for historical facts. By contrast, when the court must consider what would have occurred but for the tort, or what might yet occur, it cannot apply the same binary approach. Questions of future or hypothetical effect of injury are not susceptible of scientific proof. The law therefore takes account of such events only in terms of the degree of probability that they would have occurred or might occur.
Deane, Gaudron and McHugh JJ. explained that the probability may range from 99.9 per cent to 0.1 per cent. Unless the chance is so low as to be merely speculative (say less than 1 per cent) or so high as to be practically certain (say over 99 per cent), the court must reflect that chance in the damages awarded. This principle is drawn directly from Lord Diplock's speech in Mallett v McMonagle and is reinforced by Davies v Taylor and McIntosh v Williams. The same method applies whether the hypothetical event is said to lie in the past or the future.
Applied to the facts, the plaintiff had established that his neurotic condition at trial, which rendered him unemployable, was the result of the brucellosis. There was little or no chance of recovery. Subject only to ordinary vicissitudes, he was prima facie entitled to compensation for the near-certainty of lifelong unemployability caused by the defendant's negligence. The majority in the Full Court had found it "likely" (i.e., more probable than not) that, independently of the brucellosis, the plaintiff's back condition would have rendered him unemployable by May 1982 and would have produced a similar neurotic condition. That finding was treated by the High Court as open on the evidence and was to be accepted by the Master as guidance. However, it was impossible to say the chance was 100 per cent. Therefore the damages otherwise recoverable had to be reduced to reflect the chance that the back condition would have produced the same consequences. The majority's error was to treat that likelihood as justifying a complete cut-off of economic loss after May 1982 and a virtual denial of damages for ongoing pain and care. That was an impermissible all-or-nothing application of the balance of probabilities to a hypothetical.
Brennan and Dawson JJ. emphasised the same distinction. The fact that the plaintiff had not worked for some time before trial was a matter of history to be decided on the balance of probabilities. Earning capacity, however, could only be assessed on the false hypothesis that the tort had not occurred. That assessment necessarily involves speculation and an evaluation of possibilities. Their Honours cautioned against expressing such evaluations as percentages where it could be avoided, and against using the word "probability" for minimal possibilities, but agreed that the majority had misconceived the process by treating the hypothetical back-condition scenario as though it were a past fact already proven on the balance of probabilities.
The High Court further held that the chance that the back condition and consequent unemployability would have precipitated a similar neurotic condition was not overwhelming. The plaintiff had in fact developed neurosis only after suffering prolonged and severe symptoms from brucellosis. It could not be assumed that another event would necessarily have done the same. Moreover, where two probabilities are involved (the probability of unemployability from the back alone, and the probability that such unemployability would then cause neurosis), the combined chance decreases exponentially. The majority had therefore also erred in refusing Griffiths v Kerkemeyer damages for the wife's care and in their limited award for pain and suffering. Both heads had to be assessed on the basis that the neurotic condition was caused by the negligence, but discounted for the chance that unrelated factors would have produced similar consequences and similar care needs.
The disposition followed: the appeal was allowed, the inadequate award set aside, and the matter remitted to the Master with clear directions on the correct methodology.
Before Malec v JC Hutton Pty Ltd the law on damages for personal injury already contained the seeds of the probabilistic approach. Mallett v McMonagle had made clear that the court must estimate chances rather than decide what "would have" happened on the balance of probabilities. Australian courts had applied that reasoning in cases such as Davies v Taylor (loss of dependency) and McIntosh v Williams (lost opportunity). Nevertheless, lower courts continued to slip into all-or-nothing reasoning when confronted with pre-existing degenerative conditions or vulnerabilities that might have produced the same outcome. The Full Court majority's judgment in the present case was a textbook example: once it was "likely" that the back condition would have caused identical incapacity and neurosis, damages were cut off at May 1982.
Malec crystallised and reinforced the distinction between past facts and hypotheticals. It made explicit that the evaluation applies equally to hypothetical past events ("what would have happened if the tort had not occurred") and to future possibilities. It emphasised that a chance between 1 per cent and 99 per cent must be reflected in the award; there is no room for a 51 per cent threshold that produces a binary cut-off. The decision also illustrated the multiplicative nature of probabilities when more than one hypothetical step is required. After Malec, Australian courts have been required to approach "crumbling skull" or "eggshell personality" cases by assessing the chance that the plaintiff would have suffered the same harm from independent causes and discounting the damages accordingly, rather than denying recovery altogether once the chance exceeds 50 per cent.
The principle has become a cornerstone of personal injury litigation. It is routinely cited for the proposition that damages are assessed on the basis of "loss of a chance" where the tort has destroyed or diminished a valuable opportunity, and for the symmetrical treatment of past hypotheticals and future contingencies. The addendum delivered by the Court on 26 June 1990, removing the trial judge's costs limitation once the basis for restricting damages was overturned, further underscored that costs orders must follow the corrected assessment of the plaintiff's entitlement.
The joint judgment contains several passages that have become canonical. The opening of the section "Assessing Damages for Future or Potential Events" states:
"When liability has been established and a common law court has to assess damages, its approach to events that allegedly would have occurred, but cannot now occur, or that allegedly might occur, is different from its approach to events which allegedly have occurred. A common law court determines on the balance of probabilities whether an event has occurred. If the probability of the event having occurred is greater than it not having occurred, the occurrence of the event is treated as certain ... But in the case of an event which it is alleged would or would not have occurred, or might or might not yet occur, the approach of the court is different. ... If the law is to take account of future or hypothetical events in assessing damages, it can only do so in terms of the degree of probability of those events occurring. ... Unless the chance is so low as to be regarded as speculative — say less than 1 per cent — or so high as to be practically certain — say over 99 per cent — the court will take that chance into account in assessing the damages."
Plain-English translation: Past events are decided yes-or-no on a 51/49 basis. Future or "what-if" events are decided by percentage likelihood, and the compensation is scaled up or down to match that percentage. A 49 per cent chance is not ignored; a 75 per cent chance does not give full recovery.
Later, when dealing with the Full Court's error, the judgment observes:
"On the evidence, it is impossible to conclude that it is 100 per cent certain that the plaintiff's back condition would have rendered him unemployable if he had not contracted brucellosis. So, on the majority's finding, the reduction in his damages for loss of earning capacity would be somewhere between 51 per cent and 99 per cent. But whatever the precise chance of the plaintiff's back condition totally or partially reducing his earning capacity, the majority in the Full Court erred in refusing to award him any damages for economic loss suffered after May 1982."
Plain-English translation: Even if the judge thinks there is a 70 per cent chance the bad back would have caused the same problems anyway, the plaintiff still gets 30 per cent of the full value of his lost earnings after 1982, not zero.
The Court also explained the mathematics of combined probabilities:
"When those probabilities are combined, the chance that the plaintiff would develop a neurotic condition decreases exponentially. If, for example, and only by way of illustration, there was a 75 per cent probability of his becoming unemployable by reason of his back condition even if he had not contracted brucellosis and a 75 per cent chance that that unemployability would have caused a similar neurotic condition, there was only a 56.25 per cent chance (75 per cent x 75 per cent) that, if he had not contracted brucellosis, he would have developed a similar neurotic condition."
Plain-English translation: You do not simply take the higher of two chances; you multiply them. A 75 per cent chance of unemployability times a 75 per cent chance that unemployability would cause neurosis equals only a 56.25 per cent chance overall. That is the discount to apply.
Brennan and Dawson JJ. added a practical note:
"In assessing the plaintiff's earning capacity in the present case, what had to be evaluated was the prospect that the deteriorating back condition would have precluded him from engaging in gainful employment had he not contracted brucellosis. An evaluation of that prospect had to be made. To make a finding on the balance of probabilities as though the prospect were something that had occurred in the past was to misconceive the process of evaluation."
Plain-English translation: The fact that the man had not worked recently is one thing; what he would have earned if the brucellosis had never happened is a different, speculative question that cannot be answered with a straight "more likely than not" finding.
Malec is engaged whenever a defendant argues that the plaintiff's current condition or incapacity would have arisen in any event from a pre-existing degenerative condition, a vulnerable personality, or some other independent cause. Typical triggers include:
The precedent does not apply to the determination of whether the defendant’s negligence in fact caused the injury in the first place; that remains a balance-of-probabilities question. It applies only once causation is established and the court moves to quantify the extent of the loss that is attributable to the tort as opposed to independent factors.
Malec has been followed and applied consistently by Australian courts at every level. In Sellars v Adelaide Petroleum NL the High Court itself cited Malec for the proposition that damages for loss of a commercial opportunity are assessed by reference to the degree of probability of the opportunity being realised. In Commonwealth v Amann Aviation Pty Ltd the principle was extended to contractual damages for lost profits. State courts routinely cite Malec in personal injury appeals when adjusting awards for "crumbling skull" plaintiffs. For example, in Watts v Rake (post-Malec applications) and subsequent decisions such as Purcell v Watson and Government Insurance Office v Rosniak, courts have discounted damages by explicit percentages to reflect the chance that unrelated conditions would have produced the same incapacity.
The decision has been distinguished where the evidence shows the independent cause would have produced the identical harm with virtual certainty (the 99 per cent case), or where the chance is truly speculative. It has not been overruled. Later courts have noted Brennan and Dawson JJ.'s caution against mechanical percentage discounts, preferring where possible to arrive at a single discounted figure rather than stating "we award $500,000 less 35 per cent". Nevertheless, explicit percentage reasoning remains common in trial judgments and is rarely disturbed on appeal if the evidentiary basis is sound. The multiplicative approach to successive probabilities has been applied in cases involving both economic loss and non-economic loss, and in claims for gratuitous services.
Although Malec is now settled doctrine, several practical questions remain. First, how low a probability must be before it is regarded as "speculative" and ignored? The joint judgment gives 1 per cent as an illustrative threshold, but later cases have struggled with whether 5 per cent or 10 per cent should be disregarded. Second, the precise interaction between Malec discounting and the statutory caps and thresholds introduced by civil liability legislation in most Australian jurisdictions has not been fully worked through. Some courts have applied Malec discounts before applying statutory maximums for non-economic loss; others have done so afterwards. The High Court has not yet authoritatively resolved the sequence.
Third, the extent to which a Malec discount can be applied to general damages for pain and suffering remains somewhat opaque. The joint judgment clearly contemplates such a discount, yet some trial judges have been reluctant to reduce an award for past pain actually suffered on the footing that the plaintiff might have suffered equivalent pain from another cause in the future. Fourth, the evidentiary standard required to establish the "chance" of a hypothetical event is not spelled out. Must there be medical evidence capable of quantification, or is a judicial impression based on lay evidence sufficient?
Finally, Brennan and Dawson JJ.'s observation that damages "defy precise calculation" and their preference for avoiding percentage language sits in tension with the modern tendency toward transparent, arithmetical reasoning in judgments. Whether appellate courts will increasingly insist on global rather than percentage-based assessments in complex hypothetical cases is still an open question. Until the High Court revisits the issue, practitioners must navigate the tension between the need for intellectual honesty in explaining discounts and the undoubted truth that hypothetical evaluations are not capable of mathematical precision. These unresolved edges ensure that Malec continues to generate sophisticated argument in high-value personal injury litigation more than three decades after it was decided.
High Court of Australia Brennan, Deane, Dawson, Gaudron and McHugh JJ. Malec v JC Hutton Pty Ltd [1990] HCA 20
ORDER Appeal allowed with costs. Vary so much of the orders of the Full Court of the Supreme Court of Queensland by -
(1) setting aside the order "that the Plaintiff recover against the Defendant the sum of thirty six thousand nine hundred and twenty eight dollars and forty seven cents ($36,928.47) together with interest thereon at the rate of ten per cent (10%) per annum for a period of 4½ years" and substituting in lieu thereof an order that the plaintiff recover against the defendant such sum as is assessed by the Master of the Supreme Court of Queensland in accordance with the evidence, the judgment of this Court and, subject to what is said in that judgment, the findings of Carter J. in the Full Court; and
(2) further ordering that the costs of the assessment of damages before the Master be paid by the defendant.
(3) and omitting the words and figure: "which costs for the hearing shall be limited to seven (7) days".
The Court delivered the following addendum to the judgments: -
We are in agreement with the judgment of Deane, Gaudron and McHugh JJ. and with the order that they propose, subject to some brief observations. The judgment of the majority in the Full Court seems to us to overlook the difference between the fact that the plaintiff had not been working for some time before the trial and an evaluation of the plaintiff's earning capacity which was destroyed in consequence of the defendant's negligence. The fact that the plaintiff did not work is a matter of history, and facts of that kind are ascertained for the purposes of civil litigation on the balance of probabilities: if the court attains the required degree of satisfaction as to the occurrence of an historical fact, that fact is accepted as having occurred. By contrast, earning capacity can be assessed only upon the hypothesis that the plaintiff had not been tortiously injured: what would he have been able to earn if he had not been tortiously injured? To answer that question, the court must speculate to some extent. As the hypothesis is false - for the plaintiff has been injured - the ascertainment of earning capacity involves an evaluation of possibilities, not establishing a fact as a matter of history. Hypothetical situations of the past are analogous to future possibilities: in one case the court must form an estimate of the likelihood that the hypothetical situation would have occurred, in the other the court must form an estimate of the likelihood that the possibility will occur. Both are to be distinguished from events which are alleged to have actually occurred in the past. Lord Diplock said in Mallett v. McMonagle [1] :
The role of the court in making an assessment of damages which depends upon its view as to what will be and what would have been is to be contrasted with its ordinary function in civil actions of determining what was. In determining what did happen in the past a court decides on the balance of probabilities. Anything that is more probable than not it treats as certain. But in assessing damages which depend upon its view as to what will happen in the future or would have happened in the future if something had not happened in the past, the court must make an estimate as to what are the chances that a particular thing will or would have happened and reflect those chances, whether they are more or less than even, in the amount of damages which it awards. In assessing the plaintiff's earning capacity in the present case, what had to be evaluated was the prospect that the deteriorating back condition would have precluded him from engaging in gainful employment had he not contracted brucellosis. An evaluation of that prospect had to be made. To make a finding on the balance of probabilities as though the prospect were something that had occurred in the past was to misconceive the process of evaluation. 1. [1970] A.C. 166, at p. 176.
Although we agree with the general thrust of the reasoning on this point in the judgment of Deane, Gaudron and McHugh JJ., we think it undesirable for damages to be assessed on the footing of an evaluation expressed as a percentage. Damages need not be assessed by first determining an award on the footing that the hypothetical situation would have occurred and then discounting the award by a selected percentage. Damages founded on hypothetical evaluations defy precise calculation. We should add that we would not favour the use of the term "probability" to describe the possibility of occurrence of a situation when the possibility is minimal.
Subject to these observations, we agree in the order as formulated in their Honours' reasons for judgment.
The issue in this appeal concerns the valuation of a plaintiff's damage, caused by the tortious conduct of the defendant, after it is found that it is more likely than not that the damage would have occurred in any event as the result of conditions or events for which the defendant is not legally responsible.
The appeal is brought by the plaintiff in an action for damages against his employer. The plaintiff contends that the sum of $36,928.47, substituted by the majority of the Full Court of the Supreme Court of Queensland (Matthews and Ambrose JJ.) for the sum of $19,468.54 awarded by the trial judge, is inadequate. Carter J., the dissentient, would have assessed part of the plaintiff's damage at $148,277.63 and ordered an inquiry to assess the rest of his damage.
Between October 1972 and April 1980, the defendant employed the plaintiff as a labourer in a meatworks. In July 1977 the plaintiff was diagnosed as suffering from brucellosis, a disease acquired from animals. One possible sequela of brucellosis is the development of depressive illness. Another possible sequela of brucellosis is the development of an organic condition which results in a degenerative-like condition in the spine.
The trial judge found that sometime between 1975 and 1977, as the result of the defendant's negligence, the plaintiff had contracted acute brucellosis, but that by June 1983 that condition was no longer present. His Honour also found that, since at least 1982, the plaintiff had suffered from symptoms in his cervical and lumbar spine, but he was not satisfied that the plaintiff's spinal condition was a consequence of contracting brucellosis. He was satisfied, however, that a neurotic illness which was diagnosed in 1979 "was precipitated by brucellosis". Nevertheless, he found that it was at least as probable as not that the neurotic condition from which the plaintiff suffered at the time of the trial (September 1987) was not related to the brucellosis which he had contracted in the period 1975-1977. However, this finding was reversed by all members of the Full Court. They held that the plaintiff's damages should be assessed on the basis that his neurotic condition at the time of the trial was caused by depression induced by acute brucellosis. But Matthews and Ambrose JJ. went on to conclude that, by reason of the plaintiff's personality, it was "likely that the development of symptoms from his deteriorating back condition would have produced a similar neurotic condition even if he had never contracted the brucellosis". Their Honours said:
[I]t is likely that, quite apart from his suffering from brucellosis, by age forty-four he would have become unemployable as a result of his back condition and indeed would have developed as a result a neurotic condition of the sort from which he presently suffers. At the date of the trial, the plaintiff was forty-nine years old. Consequently, Matthews and Ambrose JJ. awarded the plaintiff damages for economic loss only until May 1982. Their Honours awarded $15,000 damages for pain and suffering but, somewhat surprisingly in view of their approach to economic loss, they apportioned "that sum as to $12,000.00 pre-trial and $3,000.00 post-trial". They refused to award damages for the care and attention given to the plaintiff by his wife. Their Honours said: He regarded himself as unemployable as the result of this back condition by mid-1982. By that time whatever care and attention was necessary or given to him by his wife was quite unrelated in our opinion to the onset of brucellosis or its attendant neurosis which gave him a cause of action against the respondent and we are of the view that to expound damages on the basis of Griffiths v. Kerkemeyer [2] is quite unjustified. 1. (1977) 139 C.L.R. 161.
In his dissenting judgment, Carter J. held that the plaintiff's damages should be assessed on the basis that, as a result of contracting brucellosis, he suffered a neurotic decompensation which would continue and which had rendered, and would continue to render, him unemployable. His Honour said that in making such an assessment it would be necessary to take account of two discounting factors: first, that some of the plaintiff's present symptoms were referable to the condition of the lumbar and cervical regions of his spine which was unrelated to brucellosis and, secondly, that by reason of his personality the plaintiff was vulnerable and predisposed to the onset of psychiatric disability as a result of the occurrence of some other event, whether at work or elsewhere. On the authority of Griffiths v. Kerkemeyer, his Honour would also have awarded the plaintiff $70,000 for the care and attention given to him by his wife.
In our opinion the majority of the Full Court erred in holding that the plaintiff was not entitled to damages for economic loss after May 1982. Furthermore, we think that their Honours fell into error in their assessment of the damages for pain and suffering and in refusing to award the plaintiff damages for the care and attention given to him by his wife.
When liability has been established and a common law court has to assess damages, its approach to events that allegedly would have occurred, but cannot now occur, or that allegedly might occur, is different from its approach to events which allegedly have occurred. A common law court determines on the balance of probabilities whether an event has occurred. If the probability of the event having occurred is greater than it not having occurred, the occurrence of the event is treated as certain; if the probability of it having occurred is less than it not having occurred, it is treated as not having occurred. Hence, in respect of events which have or have not occurred, damages are assessed on an all or nothing approach. But in the case of an event which it is alleged would or would not have occurred, or might or might not yet occur, the approach of the court is different. The future may be predicted and the hypothetical may be conjectured. But questions as to the future or hypothetical effect of physical injury or degeneration are not commonly susceptible of scientific demonstration or proof. If the law is to take account of future or hypothetical events in assessing damages, it can only do so in terms of the degree of probability of those events occurring. The probability may be very high - 99.9 per cent - or very low - 0.1 per cent. But unless the chance is so low as to be regarded as speculative - say less than 1 per cent - or so high as to be practically certain - say over 99 per cent - the court will take that chance into account in assessing the damages. Where proof is necessarily unattainable, it would be unfair to treat as certain a prediction which has a 51 per cent probability of occurring, but to ignore altogether a prediction which has a 49 per cent probability of occurring. Thus, the court assesses the degree of probability that an event would have occurred, or might occur, and adjusts its award of damages to reflect the degree of probability. The adjustment may increase or decrease the amount of damages otherwise to be awarded. See Mallett v. McMonagle [3] ; Davies v. Taylor [4] ; McIntosh v. Williams [5] . The approach is the same whether it is alleged that the event would have occurred before or might occur after the assessment of damages takes place.
In the present case, the majority of the Full Court fell into error in concluding that the plaintiff was not entitled to damages for economic loss sustained after May 1982. The plaintiff proved that, at the date of the trial, as the result of the defendant's negligence, he suffered from a psychiatric condition which rendered him unemployable. On the evidence there was little, if any, chance that he would either recover or ever be employable. Subject to an allowance for the ordinary vicissitudes of life, the plaintiff was prima facie entitled to be compensated for the near certainty that, as the result of the defendant's negligence, he will suffer from his psychiatric condition and be unemployable for the rest of his life. However, the majority in the Full Court found that it was "likely" that, independently of the defendant's negligence, by May 1982 the plaintiff would have been unemployable and suffering from a similar neurotic condition. By the term "likely", their Honours no doubt meant that there was more than a 50 per cent chance that this would have occurred. On that hypothesis, the damages otherwise recoverable by the plaintiff would have to be reduced to provide for that chance. On the evidence, it is impossible to conclude that it is 100 per cent certain that the plaintiff's back condition would have rendered him unemployable if he had not contracted brucellosis. So, on the majority's finding, the reduction in his damages for loss of earning capacity would be somewhere between 51 per cent and 99 per cent. But whatever the precise chance of the plaintiff's back condition totally or partially reducing his earning capacity, the majority in the Full Court erred in refusing to award him any damages for economic loss suffered after May 1982.
Matthews and Ambrose JJ. also found that it was more likely than not that, as the result of the plaintiff's back condition and consequent unemployability, he would have developed a similar neurotic condition. As a result, they refused to award any damages for the care and attention which his wife gave to him and, although the basis of their award for pain and suffering is not clear, they obviously took the view that all effects of the defendant's negligence would be spent shortly after the date of trial. It is impossible to conclude, however, that it was 100 per cent certain that the plaintiff's back condition and consequent unemployability would have precipitated a similar neurotic condition. On the evidence and the findings of the majority of the Full Court, the chance that a similar neurotic condition would actually have resulted from these two events occurring may well be thought to have been far from overwhelming. True it is that the plaintiff developed a neurotic condition as the result of contracting brucellosis. But that disease resulted in suffering which was prolonged and severe. It by no means follows from what occurred as the result of his contracting brucellosis that there is an overwhelming likelihood that another event or other events would have precipitated a similar neurotic condition. First, there was a substantial chance that, even if the plaintiff's back had made him unemployable, he would have gone through life without suffering from a neurotic condition similar to his present condition. Secondly, in determining the chance that unemployability as the result of his back condition would have precipitated a similar neurotic condition, it is necessary to bear in mind that more than one probability is involved. There is the degree of probability that the plaintiff would have become unemployable in any event as the result of his back condition and there is the degree of probability that the happening of that occurrence would have precipitated a neurotic condition. When those probabilities are combined, the chance that the plaintiff would develop a neurotic condition decreases exponentially. If, for example, and only by way of illustration, there was a 75 per cent probability of his becoming unemployable by reason of his back condition even if he had not contracted brucellosis and a 75 per cent chance that that unemployability would have caused a similar neurotic condition, there was only a 56.25 per cent chance (75 per cent x 75 per cent) that, if he had not contracted brucellosis, he would have developed a similar neurotic condition.
Whatever the precise chance that the plaintiff would have developed a similar neurotic condition, the majority in the Full Court erred in refusing to award him any damages for the care and attention given to him by his wife and for the neurotic condition from which he presently suffers. The plaintiff is entitled to damages for pain and suffering on the basis that his neurotic condition is the direct result of the defendant's negligence. Those damages must be reduced, however, to take account of the chance that factors, unconnected with the defendant's negligence, might have brought about the onset of a similar neurotic condition. Likewise, the plaintiff is entitled to compensation for the care and attention provided by his wife. Again that award must be reduced to take account of the chance that factors, unconnected with the defendant's negligence, would have necessitated similar care and attention.
The appeal must be allowed. The plaintiff submitted that the matter should be referred to the Master to assess the damages in accordance with the findings of Carter J. Subject to one qualification, we consider that that is the appropriate course in the circumstances. Indeed, we did not understand counsel for the respondent (defendant) to contest that course of action in the event that the approach of the majority of the Full Court was held to be erroneous. The qualification arises from the fact that Carter J. did not expressly find, as did the majority of the Full Court, that it was probable, in the sense of more likely than not, that the plaintiff would in any event have developed a back condition which would have rendered him unemployable from 1982. Nor did Carter J. expressly find that it was also probable that the combination of such unemployability and such a back condition would have given rise to a similar neurotic condition. The views of the majority of the Full Court on those matters were open to their Honours on the evidence and should be accepted by the Master as providing guidance about the chances of what would or would not have occurred if the plaintiff had not contracted brucellosis.
The appeal is allowed. The judgment entered for the appellant (plaintiff) in the sum of $36,928.47 is set aside. In lieu thereof, judgment is entered for the appellant in such sum as is assessed by the Master of the Supreme Court of Queensland in accordance with the evidence, the findings of Carter J. in the Full Court and the judgment of this Court. The appellant's costs of the trial (limited to seven days), his costs of the appeal and cross-appeal to the Full Court, his costs of the appeal to this Court and his costs of the assessment of damages before the Master are to be paid by the respondent.
June 26 Brennan, Deane, Dawson, Gaudron and McHugh JJ.
The trial judge ordered that the plaintiff recover his costs of the action limited to seven days. His Honour was of the view that, having regard to the findings which he made and the limitation which those findings placed on the plaintiff's damages, he should in the exercise of his discretion restrict the costs which the plaintiff should recover. On appeal to this Court it was held that the plaintiff's recoverable losses were not limited in the manner in which his Honour had found. The basis for the restriction on the order for costs was thus removed. Consequently, the order for costs should be reformed to reflect the reasons for judgment of this Court.
The limitation contained in the order of the trial judge should be deleted. The order of this Court should be amended accordingly.
Malec
JC Hutton Pty Ltd
Appeal allowed with costs. Orders of the Full Court varied by setting aside the award of $36,928.47 and substituting an order that the plaintiff recover such sum as assessed by the Master in accordance with the evidence, the judgment of the High Court and (subject to that judgment) the findings of Carter J.; costs of the assessment before the Master to be paid by the defendant; limitation on trial costs deleted.