THE JUDGMENTS AT FIRST INSTANCE
16The primary judge made the following observations regarding the onus of proof of loss of earning capacity and consequent financial loss:
"190 It is necessary for a plaintiff to prove the loss for which compensation is claimed: Todorovic v Waller (1981) 150 CLR 402 at 412-413, however conversely, it is not incumbent upon the injured plaintiff to prove what employment he or she "is not [in]capacitated from performing ". It is for a defendant who contends that the plaintiff has a residual earning capacity to adduce evidence of what the plaintiff is capable of doing and what jobs are open to such a person: Luntz, Assessment of Damages for Personal Injury and Death (4th ed) at [118 [1.9.20]].
191 This approach was referred to with approval in Magnou v Australian Wool Testing Authority Ltd [2007] NSWCA 357 at [20]. I will consider these questions with the question of onus in mind."
17The primary judge expressed the following conclusions as to the respondent's loss of earning capacity:
"206 In my opinion, the extent of his injuries and disabilities means that Mr Kerney is fit to work part time in light or restricted duties, probably for no more than three hours a day, in a job which he can sit and stand as necessary, and in which he is not required to walk over rough or uneven ground or climb stairs.
207 In other words, his residual capacity for work from 1 September 2007, when he last saw Dr Harris and was discharged from his care, to date is in the order of 40 per cent.
208 The defendants tendered evidence, which was not challenged, that there were a range of occupations which with his skills and education, Mr Kerney could engage in.
209 These theoretically available positions included:
(a) Hire car or taxi radio dispatcher;
(b) Driving instructor;
(c) Bus driver;
(d) Desktop publishing operator;
(e) Sales representative;
(f) Excavator Operator; or
(g) Real estate property manager.
210 Mr Kerney agreed that some, but not all, of these occupations were within his physical capacity. I would add to that agreement these constraints, namely, providing he could work on a part time basis with a sufficiently flexible employer who would tolerate the unpredictability of his attendance.
211 Accordingly, the defendants had discharged by their evidence, the obligation to prove that there were occupations in which Mr Kerney was able to engage."
18Having determined what he described as the respondent's "theoretical work capacity" (Judgment [219]), his Honour proceeded to determine whether the respondent could, as a practical matter, utilise that capacity to obtain work in the geographic area in which it was reasonable for him to seek work. This reflected the proper approach identified in Nominal Defendant v Livaja [2011] NSWCA 121 as follows:
" ... Because an individual has a physical and mental ability to undertake certain tasks, it does not necessarily follow that he has a significant residual earning capacity. Earning capacity must be measured by reference to the individual, when viewed with all his or her characteristics, in the labour market. When a person in middle age has spent all his or her life in a skilled or semi-skilled occupation which, as a result of injury, is no longer available, the identification of occupations which are theoretically available is only part of the task. There must also be a practical assessment of the likelihood of the individual obtaining employment in some such occupation ..." ([65]).
19The primary judge's conclusions on this question were as follows:
"213 In my opinion, the following circumstances are relevant:
(a) At the time of his accident, Mr Kerney was in his mid 30s and is now aged about 45. His employment history was in one field with one employer;
(b) The field in which he was skilled, namely telecommunications, has in the period since his accident, undergone technological change to a marked extent. Without undergoing any retraining, work in the telecommunications industry would not be open to Mr Kerney;
(c) Mr Kerney has lived all of his life in Kandos, a small town northwest of Sydney. That is where his home is, it is where he went to school and where he grew up. His elderly parents who are in failing health live there, and it cannot be reasonably expected that in the foreseeable future, Mr Kerney should exercise his residual work capacity by moving away from Kandos;
(d) As a consequence, the places open to Mr Kerney to exercise his work capacity are those cities and towns within no more than one hour's drive of Kandos. In a practical sense, this means the towns of Kandos, Rylstone and Mudgee, as well as the environs of those towns;
(e) Although I have formed the view that Mr Kerney is capable of working three hours a day, there will be periods of time when Mr Kerney's physical injuries and disabilities mean that he cannot work every day in a working week and he may have to work part-time. In other words, he may be in a position of taking more sick leave than would an ordinary employee, or else having a less reliable attendance record.
214 There was no evidence of the state of the labour market in the Kandos and surrounding areas, by which I include Rylstone, Mudgee and their environs. I do not know whether there are more jobs on offer than there are applicants, nor do I know whether there are any employers in that region, who are sympathetic to employing men of Mr Kerney's age who have disabilities.
215 There is no evidence, even of a generally descriptive nature, about the types and numbers of employers, the industries in which they work or operate, and the levels of their operation in the area in which Mr Kerney is based.
216 In cross-examination, senior counsel for the defendants put to Mr Kerney that he was capable of doing a number of jobs in areas of skill which were identified to him. Mr Kerney readily agreed.
217 However, Senior Counsel did not put to Mr Kerney that there were any realistically available job opportunities in the relevant geographical areas. In fact, Senior Counsel's approach was to the contrary.
[There was then set out an exchange in cross-examination, the principal part of which is set out in [12] above].
218 The thrust of this cross-examination was to accept that the availability of work was very limited in Rylstone and Kandos, may have been better in Mudgee, but that Mr Kerney ought reasonably to have considered moving to Sydney to obtain employment.
219 The evidence does not enable me to be satisfied that, whatever the limited extent of Mr Kerney's theoretical work capacity is, that there is any practically achievable job which he can do on the open labour market in the general area in which he lives.
220 It is not reasonable to expect him to move from Kandos. I think it is practical for him to travel to Mudgee to obtain employment there, notwithstanding his evidence to the contrary. But there is simply no evidence that by going to Mudgee there would be any work which he could practically obtain."
20The primary judge stated that his conclusions were supported by the appellants' failure to tender any evidence from the VCC or Recovre concerning jobs available to the respondent. He referred to Jones v Dunkel [1959] HCA 8; 101 CLR 298 and said that the VCC "seems an organisation which is entirely suitable to have undertaken such an exercise" (that is, to determine what jobs were available for the respondent) (Judgment [221]). Yet no such exercise occurred.
21In light of these findings the primary judge concluded that the respondent's residual earning capacity had no value and he was therefore entitled "to the entirety of his Telstra earnings by way of economic loss from the time of the accident up to judgment" (Judgment [223]).
22In relation to future economic loss, the primary judge reiterated his earlier conclusion that the respondent's theoretical residual earning capacity "does not result in any practically available work" and concluded that it "is unlikely in the future that he will be able to earn any money as a consequence of the conditions in which he presently is" (Judgment [228]). He therefore calculated the respondent's future loss by reference to the entirety of the net wages that he was likely to have earned, but for the accident, from his employment with Telstra, subject to the ordinary deduction of 15 per cent for adverse vicissitudes.
23His Honour calculated the respondent's loss upon the basis that, but for the accident, he was likely to have worked for Telstra, or a similar employer, until ordinary retirement age which his Honour took to be 65 years (Judgment [227]).