Nominal Defendant v Meakes

DUE INQUIRY AND SEARCH 25I shall deal first with the Nominal Defendant's submission that the primary Judge erred in finding that the respondent had satisfied s 34(1) of the MAC Act.

The Legislation 26At the date of the accident, s 34(1) of the MAC Act provided as follows: "(1) An action for the recovery of damages in respect of the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle on a road in New South Wales may, if the identity of the vehicle cannot after due inquiry and search be established, be brought against the Nominal Defendant. ... (2) The inquiry or search may be proved orally or by affidavit of the person who made the inquiry or search. (3) In respect of any such action, the Nominal Defendant is liable as if it were the owner or driver of the motor vehicle." 27The Motor Accidents Compensation Amendment (Claims and Dispute Resolution) Act 2007, Sch 1 [2], [3], amended s 34 by omitting the words "after due inquiry and search" from s 34(1) and inserting a separate subsection (s 34(1AA)). Section 34 now relevantly provides as follows: "(1) An action for the recovery of damages in respect of the death of or injury to a person caused by the fault of the owner or driver of a motor vehicle in the use or operation of the vehicle on a road in New South Wales may, if the identity of the vehicle cannot be established, be brought against the Nominal Defendant. (1AA) A claim cannot be made against the Nominal Defendant under this section unless due inquiry and search has been made to establish the identity of the motor vehicle concerned." 28These amendments do not apply in respect of a motor accident that occurred before the commencement of the amending legislation on 1 October 2008: MAC Act, Sch 5, Part 6, cl 25. Similarly, amendments introducing new procedures in cases where the Nominal Defendant is entitled, or claims to be entitled, to reject a claim for failure to make due inquiry and search do not apply in the present case: see now MAC Act, s 34A. 29It was common ground on the appeal that s 34(1) of the MAC Act creates a cause of action against the Nominal Defendant, a condition precedent of which is that there must have been due inquiry and search for the purpose of identifying the motor vehicle and that it must have been impossible thereby to establish the identity of the vehicle: Blandford v Fox (1944) 45 SR (NSW) 241, at 244-245, per curiam; Cavanagh v Nominal Defendant [1958] HCA 57; 100 CLR 375, at 380, per Dixon CJ (with whom Kitto, Taylor, Menzies and Windeyer JJ agreed on this point). It was also common ground that the respondent bore the burden of establishing that the requirements of s 34(1) were satisfied.

Construction of MAC Act s 34 30A provision substantially in the form of s 34 of the MAC Act was introduced in New South Wales by s 30(2) of the Motor Vehicles (Third Party Insurance) Act 1942 ("1942 Act"). At first, the conditions attached to the now statutory cause of action received what Kirby P in Oztan v NSW Ministerial Corporation (1995) 23 MVR 259, at 264, described as a "rather stringent" interpretation. 31Kirby P was referring to the decision of the Full Court of the Supreme Court in Blandford v Fox, decided in 1944. In that case, Jordan CJ in delivering the judgment of the Court (Jordan CJ, Davidson J and Nicholas J in Eq) stated (at 245) the policy considerations underlying the legislation and the proper approach to the question of due inquiry and search, as follows: "It has been pointed out that this part of the statute gives rise to obvious danger of abuse, and that cases arising under it therefore call for cautious approach ... A person who has sustained an injury out of all relation to a motor vehicle may falsely allege that it was caused by a motor vehicle the identity of which he is unable to ascertain; or, where the injury was caused by a motor vehicle, he may collusively pretend ignorance because he fears that contributory negligence may be sheeted home to him, or for some other reason; in either case it is difficult for a nominal defendant ignorant of the facts, to break down the claim. But the provision of s 30(2)(a), making due inquiry and search a condition precedent to the cause of action, affords little protection against such abuse. A person capable of staging a sham would not be likely to fail to make meticulous inquiry and search, since he would have the best of reasons for knowing that they would be fruitless. The provision is designed rather to ensure a genuine effort to obtain information on the part of bona fide claimants. ... The questions then arise, what is meant by due inquiry and search, and is there any evidence on which reasonable men could find that due inquiry and search had been made? I think the due inquiry and search means such inquiry and search as is reasonable in the circumstances. To be reasonable it must be as prompt and thorough as the circumstances will permit. It must be such as a reasonable man who had recourse only against the actual offender would make if he were desirous of identifying the offender in order to commence proceedings against him. The inquiries must if possible be set on foot before the scent is cold, and they must be made by all such means as are reasonably practicable in all quarters in which there is a reasonable prospect of obtaining useful information." 32In Blandford v Fox, the plaintiff was a pedestrian crossing a road on crutches. He was injured when one of his crutches was hit by a passing car. The car stopped, but the plaintiff did not report the matter to the police or take down any details. Even after he realised the next day that his injuries were serious, he made no further inquiries, except for a "perfunctory" inquiry made by his solicitors to the police some four weeks later. The Court found (at 246) the evidence was insufficient to establish due inquiry and search. 33The first High Court decision on s 30(2) of the 1942 Act was Cavanagh v Nominal Defendant. The plaintiff had been thrown from a horse as the result of the actions of the driver of a motor vehicle. Because of the circumstances of the accident, she was unable to record the correct registration number at the time. The case ultimately turned on the holding, contrary to the decision of the trial Judge, that there was admissible evidence sufficiently disclosing the results of the police inquiries as to the identity of the vehicle. 34Dixon CJ made observations about the construction of s 30(2)(a), which he said were supported by the analysis of Jordan CJ in Blandford v Fox. Dixon CJ pointed out (at 380) that the language of the statutory condition was indefinite and impersonal, indicating that it was not necessarily the plaintiff who had to inquire and search. His Honour then elaborated (at 380-381) on the requirement of "due inquiry and search": "But the word 'due' brings with it the circumstances of the case as the test of what inquiry and search will suffice. And it is the circumstances of the case of the person suffering bodily injury or, where death has been caused, of the claimant that must be considered. It is the word 'due' which connects the inquiry and search with the person injured where, as here, the claim is for bodily injury. You must look at the circumstances in which he or she was placed and, bearing in mind that the question is one affecting that person's rights, say whether in those circumstances enough was done by or on behalf of or in the interest of that person to warrant the description 'due' inquiry and search. A man picked up by the roadside with a fractured skull who remains unconscious for weeks cannot be denied the application of the provisions because no one has been active on his behalf in looking for the motor vehicle while he lay in that condition. But a very different view might be taken of the case of a man suffering a minor injury in comparatively full possession of his physical faculties. Perhaps the effect of the material part of the provision might be summed up by saying that the condition it imposes is that the claimant is not able to provide any adequate information as to the identity of the vehicle notwithstanding that the claimant and those acting for the claimant with his or her authority have taken such measures to ascertain it as were reasonable in the circumstances of the case having regard to the situation of the claimant." (Emphasis added.) 35In Slinn v Nominal Defendant [1964] HCA 72; 112 CLR 334, a case involving the Australian Capital Territory equivalent to s 30(2) of the 1942 Act, the High Court held that the "due inquiry and search" did not have to be conducted by the plaintiff or on the plaintiff's behalf. Nor did the plaintiff have to show that there had been some activity, separate and independent of an inquiry, which could be designated as a "search". As Barwick CJ (with whom McTiernan J agreed) observed (at 339), the concept of "due inquiry and search" is a compound one, indicating that there should be an inquiry and that "inquiries when they yield leads should be followed up". His Honour also observed (at 339) that the word "due" was controlling and: "accommodates to the circumstances of the case the nature and extent of the inquiry and search which is required." 36On the facts in Slinn, Barwick CJ found that due inquiry and search had been undertaken to establish the identity of the relevant vehicle. The driver of the vehicle had caused the accident by passing too close to the plaintiff's vehicle causing her to lose control, but it had been impossible for the plaintiff to identify the vehicle at the time. The plaintiff's husband had subsequently asked the police about the prospects of identifying the vehicle but had been told that the prospects were negligible. Barwick CJ found (at 340) that while further inquiries, such as a newspaper advertisement seeking information, might have been made, it was "unusual" to have expected them to have yielded any results. 37In Oztan, Kirby P said (at 264) that the decision of the High Court in Harrison v Nominal Defendant (1975) 7 ALR 680, "injected an element of enhanced realism in what could reasonably be expected of an injured person (or that person's agents)". In Harrison, a passenger in a taxi was injured when a car ran into the stationary taxi. The driver of that car decamped before the passenger could obtain the number of the vehicle. The majority of the Full Bench of the New South Wales Supreme Court found that due inquiry and search had not been made, because the plaintiff was unable to show that inquiries made by third parties had been brought to her attention before she commenced her action: Harrison v Nominal Defendant [1974] 1 NSWLR 146. 38A unanimous High Court rejected this approach. Barwick CJ (with whom McTiernan, Stephen, Mason and Jacobs JJ agreed) said (at 681) that: "the question is whether the identity of the vehicle causing the injury cannot, after due inquiry and search, be established. It is not whether the plaintiff knew of such inquiries and search as might have taken place or of their result." (Emphasis added.) Barwick CJ also said (at 681-682) that he disagreed with an approach that required steps to be taken which would amount to no more than an unproductive ritual. 39His Honour continued as follows (at 682): "The question is not simply whether due inquiries and search had been made. The terms of the subsection ought to be borne in mind. They cover the case of death as well as of bodily injury caused by or arising out of the use of a motor vehicle in the public street in particular circumstances, namely those in which 'the identity of the motor vehicle cannot after due inquiry and search be established'. Where this is the situation, a right of action against the Nominal Defendant is given. The stipulation that the identity of the vehicle is incapable of being established is made for the protection of the Nominal Defendant. It imposes no obligation, as such, upon the plaintiff; though the plaintiff to succeed must establish that the identity is incapable of being established as in the terms of the section. The word 'after' in the subsection does not, in my opinion, require that some inquiry and search must necessarily in fact always precede some other event or the drawing of a conclusion. If, in the circumstances of the case, it is evident that the identity of the vehicle could not be established by due search and inquiry the stipulation, in my opinion, may be held to be established, although no search or inquiry destined to be futile has been made. The section does not, in my opinion, require that in every case, irrespective of its circumstances, some inquiry and search should have been made. Whether or not the identity of the vehicle might have been established after search and inquiry appropriate to the circumstances of the case had been made is a question of fact. That, in my opinion, is the relevant issue in a case brought under s 30(2)(a) of the Act. It is not whether some search and inquiry has been made. The presence of the word 'due' in the subsection emphasizes that the question is whether the identity of the vehicle cannot be established though such search and inquiry as might appropriately be made in the circumstances of the case had taken place. ... It is a mistake, in my opinion, to divorce the words 'after due inquiry and search' from the total expression of the condition on which the action against the Nominal Defendant may be brought. Whether or not the tribunal of fact is satisfied that the identity of the vehicle cannot be established after such search and inquiry of which the circumstances admit will depend on all the circumstances of the case. An affirmative finding that the identity of the vehicle cannot be established in terms of the subsection is, in my opinion, a finding which a Court of Appeal must rarely be able to set aside as erroneous." (Emphasis added.) 40The High Court in Harrison restored the decision of the trial Judge that the plaintiff had satisfied the terms of the legislation. In Barwick CJ's view (at 683) nothing which the plaintiff, the taxi driver or police could have done was likely to have established the identity of the vehicle the driver of which caused the accident. 41Oztan, like Harrison, was a case of a rear end collision with a stationary vehicle. A witness to the accident provided the driver of the stationary vehicle with a registration number for the offending vehicle, which had left the scene more or less immediately. It turned out that the number recorded by the witness was that of a stolen vehicle and in any event may have been mistaken. The trial Judge found that due inquiry and search had not been undertaken because further inquiries could have been made. These included placing of advertisements and additional investigations into the origins of the stolen vehicle, possibly directed to interstate authorities. 42Kirby P held that the trial Judge had paid insufficient attention to the instruction given by the High Court in Harrison. His Honour said (at 265-266): "The requirement of due inquiry and search is for the protection of the nominal defendant. But this is not a case (as many are) where there may be doubt that an incident occurred at all involving an unidentified vehicle. Here, there is no real room for dispute that [the plaintiff's] vehicle was struck [and in view of the evidence] that the vehicle was certainly of New South Wales registration, the imposition of an obligation on the appellants (and their representatives) to proceed to search the motor registries of every state of Australia on the off-chance of finding the identity of the offending vehicle seems unrealistic. It partakes of the ritualistic conduct which the High Court in Harrison was at pains to criticise. ... While it is true ... that further inquiries and searches might have been done, I consider that his Honour erred in applying an excessively stringent requirement of inquiry and search. By the application of the approach mandated in Harrison, I consider that such inquiry and search as was conducted was, in the circumstances, adequate ('due') to permit the appellants to pursue their claims against the corporation. I do not regard this as an entirely clear case, I acknowledge that different minds might reach different conclusions. The case is at the borderline." 43Nominal Defendant v Smith (1998) 28 MVR 165 was a case of a pedestrian injured while attempting to cross a road from the median strip. The police attended the scene and interviewed the driver of the vehicle but, rather remarkably, did not record the registration number of the vehicle. The plaintiff made subsequent inquiries of the police, but they proved fruitless. The trial Judge found that the plaintiff was entitled to assume that the police would take the necessary details and that due search and inquiry had been made to establish the identity of the vehicle. 44On appeal, Sheppard AJA (with whom Priestley and Meagher JJA agreed) noted (at 174) that further inquiries, such as placing local newspaper advertisements, would not necessarily have been futile, since many people had apparently been aware of the accident at the time it occurred. The Court, however, declined to interfere with the trial Judge's findings. Sheppard AJA accepted that the evidence was weak, but took into account that Barwick CJ in Harrison had cautioned against over zealous interference with the findings of trial Judges. His Honour considered that it was open to the trial Judge to conclude that the statutory condition had been complied with. 45The most recent consideration of the "due search and inquiry" provision in this Court appears to have been Nominal Defendant v Swift [2007] NSWCA 56. In that case, it was impossible for the plaintiff at the time of the accident, to identify the vehicle responsible for forcing him off the road. The Court upheld the finding of the trial Judge that there had been due inquiry and search by notifying the police, given that the case was one of "guilty flight". Santow JA (with whom Beazley and McColl JJA agreed) emphasised (at [38]) that a finding of this kind should rarely be displaced and that the statutory obligation should be construed in a realistic manner.

The Primary Judge's Approach 46The primary Judge made findings of fact relevant to the question of whether the respondent had satisfied the conditions stated in s 34 of the MAC Act. The findings included the following:

• After the accident on Friday 1 August 2008 (and after attending the settlement scheduled for 4 pm that day), the respondent returned to his office (at [237]).
• On the following Monday, 4 August 2008, the respondent instructed Mr Ford, a principal in his own firm, to act on his behalf. On Mr Ford's advice, the respondent reported the accident to the police at 6 pm on 4 August 2008. The respondent confirmed to the police that he did not know the identity of the vehicle that had struck him (at [237]).
• It was difficult to discern what benefit would have been gained from the respondent reporting the matter earlier, given that no-one else had made any report of the incident (at [238]).
• The respondent and Mr Ford attended the scene of the accident at 3.30 pm on Tuesday, 5 August 2008 (at [239]). They proceeded to the nearby Starbucks Café in an endeavour to locate potential witnesses. A female employee said that Mr Kevin Lo, another employee, had seen the accident but that he had gone overseas. Subsequent correspondence confirmed that Mr Lo had observed the accident. Mr Lo was called at the trial by the Nominal Defendant but could not provide any information as to the identity of the vehicle (at [240], [247]).
• The respondent undertook other inquiries in the area, including an inquiry as to whether CCTV footage of the incident was available. None of these inquiries yielded worthwhile information (at [241]-[242]).
• On 17 September 2008, the respondent's solicitors notified the Nominal Defendant of the accident (at [243]).
• On 10 December 2008, a representative of the Nominal Defendant recorded an interview with the respondent in the presence of his solicitor. The respondent fully co-operated in providing all information known to him about the incident (at [246]). 47The primary Judge recorded (at [248]) the Nominal Defendant's submission that the respondent, as a solicitor and a person with previous claims experience (he had made a claim for damages in 1994, when he was injured while travelling in a taxi involved in a collision), should have noted the registration number of the vehicle that struck him and the licence details of the driver. His Honour rejected these arguments (at [249]-[253]): "249. ... [the respondent] explained that at the time, he was shocked, and he initially thought he was going to die when first he realised he had been struck. He stated that later, when he had gathered himself, he did not consider himself to be seriously injured. At the time he was due to attend a meeting to transact important business for a client and, having been delayed by the collision, he was obviously preoccupied with the task of getting to the meeting to fulfil his obligations to his client. The [respondent] argued that in these circumstances it was understandable and excusable that he took no immediate steps to record driver and vehicle identification details.

250. In the context in which the events occurred, for the reasons that follow, I considered that at the scene, and afterwards, the [respondent] had acted reasonably, as he explained, and I reject the criticisms to the contrary made of him by the [Nominal Defendant].
251. At the scene, immediately after the collision, although he was shocked, he gathered himself and became preoccupied with the need to attend and fulfil his professional obligations towards his client's affairs and the transaction that had to be completed. At the time he thought his injuries were superficial grazes or bruises. Also, at that time, he would only have perceived at worst, that he had sustained soft tissue injuries, and no broken bones. He was able to walk despite the pain and discomfort he experienced. As a person of stoic disposition who had in the past suffered sporting injuries of a more serious character, I do not consider it was unreasonable that then the [respondent] got himself off the roadway and assessed himself as not having sustained serious injury, that he [waved] off the driver of the vehicle without taking her particulars or the vehicle registration details before himself leaving the scene to attend to his professional obligations.
252. It was only afterwards, later in the afternoon, and after he had fulfilled the requirements of his appointment that he realised he had sustained some injuries that affected his wellbeing. In response, he then did the sensible thing and cancelled his other engagement at Cronulla and drove home after waiting in his office for some time for peak traffic to clear. He did not require hospitalisation so it was understandable that he did not immediately seek medical treatment or escalate his thinking about the matter to a stage of needing to record liability matters as a prelude to making a claim for damages for personal injury. On the advice of his neighbour, a medical practitioner, the [respondent] later sought medical attention on the following Monday.
253. It was only after the weekend and when at work on the following Monday, where the [respondent] had access to advice, that steps were then set in train to investigate the liability issues. It was in the course of these events that he turned his thoughts to a consideration of what was required to protect or pursue his rights to make a claim in respect of his injuries." 48His Honour observed that the requirement for due inquiry and search was designed to protect the interests of the Nominal Defendant, but that in this case the interests of the Nominal Defendant in carrying out a liability investigation were not significantly prejudiced (at [254], [255]). All "parties", including Mr Lo, had considered the incident to be of minor importance and not worthy of taking a record (at [255]). 49The respondent's claims history was irrelevant, because the circumstances were different and the respondent had not had to make independent inquiries to ascertain the relevant details (at [256]). In this case, once the vehicle had left the scene, the trail had gone cold (at [257]). The investigations and inquiries undertaken by the respondent were realistically responsive to the circumstances (at [258]). 50The Nominal Defendant's arguments that it was the respondent's own omission that had prevented the vehicle from being identified, sought "to impose, in retrospect, an unreasonable standard of perfection for the [respondent's] response to the circumstances". His Honour said (at [261]) that those arguments: "do not pay due regard to the fact that the [respondent] was shocked and whilst on the roadway, with vehicles around him, he thought that he was going to die. In such circumstances, the need to record formal vehicle and driver identification details would have been far from his mind ... I consider that when the [respondent] gathered himself and did not discern any significant injury to himself at that time, he was justified in his initial response of brushing the incident off, and leaving the scene and proceeding to attend to his professional obligations." 51In his Honour's view, the respondent's qualifications as a legal practitioner had no significant bearing on the issue of due inquiry and search. The respondent did not practice in personal injury litigation (at [264]). Moreover: "general knowledge amongst legal practitioners would have reasonably led him to believe that as a result of successive historical tranches of tort reform legislation, only cases of significant injury would give rise to claims for damages, and he did not appreciate at the time, that he had suffered a significant injury." 52For these reasons, his Honour concluded that the Nominal Defendant's reliance on the remarks of Jordan CJ in Blandford v Fox was not supported by the facts (at [265]). The respondent had (at [266]): "fulfilled his obligation to establish that the owner or driver of the vehicle that collided with him could not be established after due inquiry and search, so as to permit the case to proceed to an assessment of his entitlement to damages for his injuries."

Reasoning 53In assessing the Nominal Defendant's challenge to the primary Judge's finding on due inquiry and search, it is necessary to bear in mind the admonition of the High Court in Harrison (at 682) that an affirmative finding that the identity of a vehicle cannot be established in terms of s 34 of the MAC Act is one that an appellate court must rarely be able to set aside. It is also necessary to remember that there has been a move away from the "rather stringent" interpretation of the forerunner to s 34 adopted in Blandford v Fox. Moreover, this is not a case in which there is any doubt that an accident occurred and that the respondent suffered injuries in consequence of the accident (cf Oztan, at 265). 54Nonetheless, the legislation must be applied according to its terms. In order to satisfy s 34(1) of the MAC Act, a plaintiff must show that the identity of the vehicle responsible for the accident cannot after due inquiry and search be established. It is true that neither the plaintiff nor the plaintiff's agents need themselves to conduct inquiries. Nor, as Harrison demonstrates, have the courts insisted on inquiries that are likely to prove futile or purely ritualistic. Indeed, it is possible, depending on the circumstances, for a plaintiff to satisfy s 34(1) without any inquiries ever having been undertaken by anybody. 55Even so, a plaintiff must show, to the appropriate standard, that:

• there has been "due inquiry and search", but that the identity of the relevant vehicle has not been established; or
• although there has not been due inquiry and search, such an inquiry and search would not have established the identity of the relevant vehicle. What constitutes "due" inquiry and search, as Dixon CJ explained in Cavanagh (at 380-381) must depend on the circumstances of the case, including (in the case of personal injury) the circumstances of the injured person. 56Before considering the specific circumstances of this case, there are two observations to be made about the primary judgment. The first is that his Honour seems not to have consistently kept in mind the statutory standard. The question was not whether it was "understandable and excusable" for the respondent not to have recorded the vehicle identification details immediately after the accident, having regard to his preoccupation with the imminent business transaction (as the respondent argued and his Honour apparently accepted, at [249]). Nor was it whether it was "unreasonable" for the respondent, in view of what was said to be his "stoic disposition", to have allowed the driver to leave the scene of the accident without taking her details (at [251]). The question was whether the respondent had shown that the identity of the vehicle would not be established after due inquiry and search. 57Secondly, there is no clear basis in the evidence for his Honour's comment that the failure to record details at the scene did not cause significant prejudice to the Nominal Defendant. If what his Honour intended to convey was that the policy underlying the statutory condition (protecting the interests of the Nominal Defendant: Harrison, at 682) had no relevance to the circumstances of this case, I disagree. 58At the most basic level, if the respondent had recorded the registration number of the vehicle, the defendant in any proceedings would not have been the Nominal Defendant but the driver of the vehicle. Independently of that consideration, the driver's evidence would plainly have been relevant on liability. The primary Judge concluded (at [204]), for example, that the evidence did not permit him to determine whether the vehicle which struck the respondent had turned left into Park Street from Elizabeth Street (to the south), or whether the vehicle had simply been travelling west on Park Street and crossed Elizabeth Street before colliding with the respondent. Similarly, his Honour could not determine on the evidence the state of the traffic lights at the intersection when the accident occurred (at [203]). Had the identity of the vehicle been established, the driver presumably could have given evidence on these and other matters, such as the speed of the vehicle at the moment of impact, that were left unclear. The driver's evidence may or may not have been unfavourable to the respondent, but her version of events is likely to have shed light on important factual questions in issue. 59Mr Rewell SC, who appeared with Mr Cleary for the Nominal Defendant, did not place any reliance on the fact that the respondent was a solicitor. Nonetheless, he contended that in the circumstances of this case, due inquiry and search required the respondent to take the simple step of recording the registration of the vehicle. 60There are some striking circumstances in the present case suggesting that "due" inquiry and search required the respondent to have taken steps at the time of the accident to obtain the registration details of the vehicle that struck him. 61First, this was not a case where there was any difficulty in ascertaining the identity of the vehicle or, for that matter, the driver. The respondent accepted in his evidence that after he had been hit, a woman aged between about 35 and 40 got out of the vehicle and had some sort of conversation with him. He also accepted in his cross-examination that he had a pen and paper in his bag when the accident happened. The following exchange then took place: "A. I wasn't thinking about that, I was lying on the roadway, I wanted to get up, I was concerned about my safety there were other vehicles in the area and I knew I had to be at an appointment. Q. It would have been a very simple matter for you to have taken a pen and to have written the registration number of the vehicle down at the occasion of the accident wouldn't it? A. I don't agree with that. I was in a shock, I had a bag that was closed, my glasses were on the road, I was picking everything up and I had to get off the roadway. Q. You could readily have obtained that information either from the driver of the car couldn't you firstly? A. I possibly could have, I could have sat there in the middle of the roadway, got my bag, opened it up and pulled out a pen and a paper, but I didn't, I had to get up and get off the roadway and get to my appointment. Q. Mr Meakes you could readily have got up off the road, picked up your bag, removed yourself to the safety of the footpath and then recorded the information couldn't you? A. That's a possibility. Q. And you could have obtained the information, that is to say the registration number either by asking the woman for that information, firstly do you agree? A. Yes I do. Q. Or secondly from direct observation of the number plate of the vehicle which had not then moved? A. That's a possibility but the last think I was thinking about was looking at the registration number of the vehicle. I wanted to get up off the roadway, I limped away and I needed to get to an appointment." (Emphasis added.) In response to a query from the primary Judge, the respondent agreed that the vehicle was only three metres away from him and that he could see the registration number. As I have noted earlier, the respondent also said that about a minute or a minute and a half elapsed between him getting to his feet and leaving the scene. 62Secondly, as the primary Judge found (at [251]), the respondent appreciated immediately after being struck by the vehicle that he had sustained injuries. His Honour suggested (in the same paragraph) that the respondent thought that his injuries were merely superficial grazes or bruises. However, the respondent did not say in evidence that he thought his injuries were trivial. Nor did he say that the apparently minor nature of his injuries was the reason for his failure to note the registration number of the vehicle. 63The respondent's evidence was that the vehicle struck him in the rib area and that he was catapulted into the air, landing on his right shoulder, right elbow and right knee. He said that apart from having to limp, he noticed that his shoulder was painful and felt that it was quite heavily bruised. He agreed with the cross-examiner that he was unable to carry his briefcase in his right hand. He also said that as he made his way to his appointment a block away: "I felt a sharp pain in my - the rib area, and also I realised I had a sore - all down my right side and I realised that I was bleeding, I had abrasions on my knees and my elbows." 64The primary Judge found (at [300]) that the injuries sustained by the respondent included a "significant impact injury to his right shoulder". That injury involved "at least a partial tearing of the supraspinatus tendon in the right shoulder". While the respondent, like many people injured in accidents, may not have appreciated at once the full extent of his injuries, he was aware that he had been injured and that his injuries were caused by the actions of the driver of the vehicle that had struck him. 65Thirdly, the respondent was not so injured that he was unable to perform the simple task of recording the registration number of the vehicle. He did not suggest that his physical injuries prevented him from noting the registration number or, for that matter, obtaining the details of the driver who had stopped her vehicle and approached him, presumably to ask if he had been hurt. The respondent accepted that he had a clear view of the stationary vehicle, which was only a few metres away. To write down the number would have taken just a few seconds. 66The respondent gave evidence that he had suffered shock and was "quite confused" as a result of the accident. The key passage in his cross-examination is as follows: "Q. Prior to 2008 I suggest that you were aware of the existence of the nominal defendant in the context of claims for injury arising from car accidents where the car couldn't be identified? A. Yes I had reason to be aware of that in my past history but it was not something that was on my mind on 1 August, 2008. Q. I didn't ask you that, I suggest that you knew as at 2008 that it was very important to record the registration number of the vehicle involved in the accident on Park Street, you knew that didn't you? A. I don't agree with that. Q. Can I remind you that in 1994 you recorded the registration details of the vehicle at fault [in the earlier accident involving the respondent] because you regarded that as important at that stage didn't you? A. That's correct. Q. I suggest to you that equally in 2008 you understood that it was very important to record the registration number of that car against the possibility that you may need to lodge a claim in the future? A. That was not on my mind at the time of the accident, I was more concerned about my personal safety, getting up from the road and I was also quite confused and I was suffering from shock. It wasn't something that was on my mind at that time. I certainly wasn't thinking about the nominal defendant when I was lying on the roadway." 67The issue, however, was not whether the respondent was thinking about the Nominal Defendant, but whether his injuries or mental condition were such as to support a finding that "due inquiry or search" did not include, in the circumstances of this case, recording the registration number of the vehicle. The respondent said repeatedly in his evidence that his main concern was to get to his 4 pm appointment as soon as possible. For example, when asked whether the driver had stayed at the scene, the respondent said: "I was gone from the scene within about probably one to one and a half minutes. I didn't engage in conversation. I had the - I was concentrating on getting to this transaction. There were numerous people waiting for me there, it was a very difficult commercial transaction and I needed to be at my 4 pm exchange." 68The evidence was consistent with the respondent's answers in his interview with the Nominal Defendant's representative, where he said that he was in shock and emotionally distressed, but had in mind that he had to get to the appointment: "I left the scene without making any inquiries, any further inquiries because I had, I had to attend this appointment." 69The respondent's evidence perhaps suggests that the shock of being struck by a vehicle contributed to his determination to get to his appointment as soon as possible. And while obtaining the number may not have come to his mind at the time, he did not say that he was incapable of appreciating the significance of obtaining the registration number. No medical evidence was adduced on the respondent's behalf suggesting that the shock was such as to render him unable to direct his mind to the need to obtain the relevant details. Certainly any shock the respondent suffered was insufficient to prevent him from proceeding almost immediately to his meeting and completing the "very difficult commercial transaction". 70Fourthly, setting aside the respondent's legal training and experience, he did not suffer from any disabilities or want of information that might have had an impact on the inquiries as to the identity of the vehicle he might reasonably be expected to have made in the circumstances. Just as the content of "due inquiry and search" in a particular case might be influenced by the physical ability of an accident victim to seek information, so it might be influenced by an accident victim's disabilities. Relevant circumstances could include, for example, the inability of a person to speak English or a recent arrival's unfamiliarity with local laws and practices. It was not suggested that the respondent suffered from any relevant disability. Indeed, the respondent accepted in his evidence (at [66] above) that he had previously made a compensation claim for injuries he had sustained in a motor vehicle accident in which he had obtained the details of the vehicle at fault. 71In assessing the "due inquiry and search" that should have been undertaken in this case it is appropriate to treat the respondent as a reasonably informed member of the community. Such a person could be expected to know that a victim injured in a motor vehicle accident, where another person is at fault, may be able to claim compensation from the person at fault. Where the victim is a pedestrian, a reasonably informed member of the community could be expected to appreciate that it is important to obtain the registration number of the vehicle and, if possible, the details of the driver in order to pursue any claim for compensation.

Conclusion on Due Search and Inquiry 72In my opinion, this is one of the relatively rare cases in which a trial Judge's finding that s 34(1) of the MAC Act had been satisfied should be set aside. The relevant circumstances of this case include the following matters:

• unlike most cases involving "due search and inquiry", the identity of the vehicle which struck the respondent was readily ascertainable by him, had he made a simple inquiry at the scene of the accident;
• the respondent was aware at the time of the accident that he had suffered injuries as the result of being struck by the motor vehicle;
• the respondent was not so injured as to be unable to perform the simple task of recording the registration details; and
• an injured person in the situation of the respondent could reasonably have been expected to obtain the relevant details at the scene. 73Each case must depend on its own circumstances. Nonetheless, it is striking that in none of the leading cases to which I have referred, with the exception of Blandford v Fox (in which the plaintiff failed) and in Nominal Defendant v Smith (where the police attended the scene), was it practicable for the plaintiff to have correctly identified the relevant vehicle at the time of the accident. The issue in each case was the sufficiency of inquiries made, not at the scene of the accident but after the event. 74In the present case, the respondent could have established the identity of the vehicle that struck him by simply recording the registration number at the scene of the accident. While there may be cases where a failure by an injured (but not incapacitated) person to record the relevant details prevents a finding that there has been "due inquiry and search" for the purposes of s 34 of the MAC Act, I do not think that this is such a case. On the evidence, the respondent was not disabled from making the obvious inquiry and his main motivation appears to have been to get to his business appointment as quickly as possible. 75As I have noted, the courts have adopted a less stringent interpretation of s 34 and its predecessors than was applied in Blandford v Fox. But to uphold the finding that the respondent had satisfied s 34 would, in my opinion, come perilously close to undermining the purpose of the section and depriving it of any real utility. Accordingly, the appeal must be allowed and orders made dismissing the respondent's claim.

OTHER ISSUES 76In view of the conclusion that I have reached, it is not necessary to deal with the other grounds of appeal relied on by the Nominal Defendant. Nonetheless, it is appropriate to address the arguments advanced by the parties.

Contributory Negligence 77The primary Judge rejected (at [222]) the Nominal Defendant's contention that the respondent had crossed Park Street against a red light. As I have noted, his Honour considered that the evidence did not permit any reasonable inference as to the status of the traffic lights at the time of the accident. His Honour took this view (at [220]) notwithstanding the respondent's frank concession that he could not recall checking whether the traffic lights displayed a green light or a "Don't Walk" signal. The Nominal Defendant does not challenge this aspect of the primary Judge's reasoning. 78The primary Judge also rejected the Nominal Defendant's submission that the respondent should not have emerged from the gridlocked traffic without looking to his left. His Honour reasoned as follows (at [224]-[230]): "224. ... although the [respondent] conceded he was concentrating or focussed upon completing his crossing, there is no evidence that compels the conclusion that he did not look to his left. In the course of making his crossing, his attention would have been directed in a number of areas, not only to his left, but also ahead of him and to the roadway itself as an ordinary incident of keeping a proper lookout for his own safety as he crossed the road. I do not consider that in the absence of notice of a vehicle approaching from his left, any momentary inattention to his left whilst continuing to proceed to cross the road, and whilst remaining within the confines of a pedestrian crossing, constitutes a relevant failure on the part of the [respondent] to take reasonable care for his own safety. In fact he had obviously turned and was in the process of looking to his left in the split-second before the collision. The fact that he did not do so beforehand is not necessarily indicative of contributory negligence on his part, as he would also have had to look where he was going, both in terms of the general direction he was walking and to where he was placing his feet on the roadway, where the potential for uneven surfaces, or pot-holes were not unknown phenomena. ... 227. The fact that the [respondent] was the only person on the crossing at the time he was struck, does not necessarily bespeak contributory negligence on his part. Having commenced to cross safely, he was entitled to continue to make his crossing in the absence of notice of vehicles approaching from his left. The fact that he crossed the road less quickly than others ahead of him is not compellingly indicative of contributory negligence on his part, especially given the unchallenged evidence that he was walking in a direct route and at a fast striding pace. I do not infer from the evidence that others had completed their crossing before the [respondent], that the [respondent] necessarily therefore failed to take care for his own safety by crossing less quickly than his fellow pedestrians. ... 230. In my view, any momentary inattention to his left, if that is the proper characterisation of the events, does not support an allegation of contributory negligence where the [respondent's] action in crossing the road was a dynamic one, which required him to have regard to a number of considerations, especially including looking where he was going on the roadway. This is particularly so where he was entitled to expect that whilst completing his crossing within the marked portion of the intersection, drivers of vehicles approaching the intersection from his left, would have due regard to his presence and allow him to complete his crossing without a resultant collision." 79The common law and the enacted law of contributory negligence apply to an award of damages in respect of a motor accident, subject to presently irrelevant exceptions: MAC Act, s 138(1). The damages recoverable in respect of the motor accident are to be reduced by such percentage as the court thinks just and equitable in the circumstances of the case: s 138(3); Law Reform (Miscellaneous Provisions) Act 1965, s 9(1)(b). The Court must state its reasons for determining a particular percentage: s 138(4). The enacted law of contributory negligence includes s 5R of the Civil Liability Act 2002 ("CL Act"). 80The test of contributory negligence is objective: the question is whether the plaintiff has taken that degree of care for his or her own safety that an ordinary reasonable person would take: Joslyn v Berryman [2003] HCA 34; 214 CLR 552, at 564-566 [32], [34], [38], per McHugh J; CL Act, s 5R(2). Once contributory negligence is found, the apportionment as between a plaintiff and defendant: "of their respective shares in the responsibility for the damage involves a comparison both of culpability, ie of the degree of departure from the standard of care of the reasonable man ... and of the relative importance of the acts of the parties in causing the damage ... It is the whole conduct of each negligent party in relation to the circumstances of the accident which must be subjected to comparative examination." Podrebersek v Australian Iron & Steel Pty Ltd [1985] HCA 34; 59 ALR 529, at 532-535, per curiam. 81There are several difficulties with the primary Judge's analysis. First, although his Honour correctly noted that the Nominal Defendant bore the burden of proof on contributory negligence, his Honour seems to have considered that the Nominal Defendant was required to adduce compelling evidence in order to establish that the respondent had been contributorily negligent. This is not the correct standard. 82Secondly, the primary Judge, while acknowledging that the respondent was concentrating on completing his crossing, appears to have found that he looked to his left just before the collision (at [224]). In fact the respondent gave no evidence that he had looked to his left at any stage. On the contrary, he accepted that he had not looked to his left as he approached the bus lane, as the following extracts from his evidence indicate: "Q. I suggest to you that as you continued to walk across Park Street and particularly as you walked across, from your point of view, the southern side of it for vehicles heading west that it would have been a prudent thing for you to do to have a look to your left hand side to guard against the possible approach of motor vehicles? A. I don't agree with that. I was more focused on making - I feel I was making a safe crossing and I was looking forward. Q. Because to your left on that side of Park Street that was the only direction from which a motor vehicle was likely to come wasn't it? A. Once I'm on that side of the crossing yes. ... Q. Can I suggest to you that if just before walking into the bus lane you had looked to your left hand side you would inevitably have been able to see this car as it got close to you and being - as it got close to you? A. I had no reason to look left because I was almost on the footpath. Q. Now that's a different question with respect. I suggest to you that if in fact you had looked to your left just before you stepped into the bus lane you could have seen the approach of this vehicle? A. I don't agree with that. Q. I suggest to you that had you looked to your left before you stepped into the bus lane you could have been the approach of this vehicle and you could have stopped in order to avoid being struck by the vehicle? A. I don't agree with that. Q. Do you say the vehicle dropped out of the sky? A. No the vehicle hit me going at a very fast pace, otherwise I wouldn't have ended up where I was. ... Q. How fast do say the car was going? A. I don't know but all I know it was going very fast because I am 13 stone in weight and it lifted me two feet off the ground and three metres that way. Q. You've got no idea what speed the car was going at do you, other than the fact that it was moving west? A. That's correct." (Emphasis added.) 83Thirdly, the primary Judge said that the respondent had obviously turned and was in the process of looking to his left in the split second before the collision. It is true that the respondent said that he saw the vehicle a split second before it struck him, but this does not support a finding that he was in the process of looking to his left, as would a reasonable person in the position of the respondent. 84Once the respondent's evidence is properly understood, the conclusion seems to me inevitable that he failed to take that degree of care for his own safety that a reasonable person would take. This was not a case of a pedestrian traversing a pedestrian crossing with the lights in his or her favour, in circumstances where oncoming drivers (or drivers turning into the intersection) had a clear view of the crossing. 85As I have noted, the primary Judge could not make any finding as to the state of the lights facing the respondent. Whatever direction the driver was coming from, there is no suggestion that she ignored a red light. The respondent was traversing a pedestrian crossing on a busy intersection that was blocked by gridlocked traffic. He emerged from between stationary vehicles onto the relatively clear bus lane, while walking at what the primary Judge described as a "fast striding pace". A pedestrian who acts in this way, without looking in the only direction from which a vehicle on the bus lane could be travelling, fails to take the simplest and most basic precautions for his own safety - namely, look towards the oncoming traffic. It must be accepted that the driver was negligent in failing to keep a proper lookout, but the respondent's failure to take reasonable care for his own safety contributed to the accident. 86In my view, the primary Judge erred in finding that the respondent was not contributorily negligent. 87At the trial, the Nominal Defendant submitted that the respondent should bear 60 to 80 per cent of responsibility for the injuries he sustained. On the appeal, Mr Rewell SC, who appeared with Mr Cleary for the Nominal Defendant, made a more modest submission that an apportionment of at least 25 per cent responsibility to the respondent would be appropriate. Having regard to the respondent's significant departure from the standard of reasonable care, I would conclude that his contributory negligence should be assessed at 25 per cent. Consequently any damages award to the respondent would have to be reduced by 25 per cent.

Economic Loss 88The primary Judge dealt separately with the respondent's claims for past diminution and future diminution in his earning capacity in consequence of his injuries. 89The respondent had argued for a "buffer" for past loss of earning capacity equivalent to $77,350, calculated at the rate of $650 per week over 119 weeks, from 4 August 2008 until the commencement of the trial on 17 November 2010. The Nominal Defendant conceded that the respondent was entitled to $10,000 as compensation for a period of four weeks when the respondent was absent from work as the result of surgery on his shoulder. Otherwise, the Nominal Defendant submitted that the respondent's entitlement to a share of the profits of the firm was independent of his own level of commitment or his physical presence at work. 90The primary Judge accepted (at [334]-[335]) that the accident-related injuries had reduced the respondent's physical involvement in sporting activities, such as golf and attendance at a gymnasium, and had also reduced his associated social activities. This had affected his ability to attract remunerative work to the firm through informal sporting contacts (at [336]). The primary Judge also accepted (at [338]) that the respondent's shoulder problems had required him to reconfigure his computer set-up in his office. 91However, his Honour also made these important findings (at [339], [343]): "339. ... I do not consider that [the] evidence ... permits a specific finding of an inability in the [respondent] to carry out specific income producing tasks. ... 343. Serious as those restrictions are [on the respondent's sporting activities], I do not consider they require a finding that the [respondent] is precluded from performing specific work related tasks that, in the case of a manual worker, would perhaps base a finding of a particular impairment of a specific earning capacity." 92In view of these findings, his Honour considered (at [343]) that the respondent's claim for damages was to be "assessed in general terms". The appropriate approach (at [344]) was to provide: "a general sum that serves as a cushion to provide the [respondent] with a buffer against the less tangible, but nevertheless real loss of capacity that has been incurred by him in respect of the described activities, notwithstanding the difficulties inherent in assessing the extent of such losses." 93In undertaking this task, his Honour took into account that:

• the number of files opened by the respondent since his injury had reduced, although it was not possible to determine the comparative nature of the files (at [348]);
• the respondent's income from the firm in 2009 and 2010 had actually increased (at [350]); and
• while it was possible that the reduction in opened files was coincidental, weight should be accorded to the respondent's evidence as to the level of his networking activities (at [354]) and as to his reduced motivation (at [355]). 94The primary Judge awarded $60,000 as a "buffer" for past diminution in the respondent's earning capacity. His Honour explained the award as follows (at [361]-[362]): "361. ... I have taken into account as a background yardstick, the [respondent's] annual franked income from his firm, as is evident from the returns that are in evidence, and also bearing in mind that any potential work lost to the [respondent's] firm as a result of his injury has to be viewed not only in terms of net loss to the [respondent] after taking overheads and tax into account, but also after taking into account the arrangements in the firm for the sharing of profits. In that regard, I consider it is more probable than not that the [respondent] would most likely have continued practising in his firm between the time of his injury and the time of the commencement of the trial.

362. ... I consider the appropriate amount to be awarded to the [respondent] for this head of damage is in the amount of $60,000, which in broad terms is the rough equivalent of an amount of $500 per week, spread over the period of 119 weeks of loss of capacity from the date of the [respondent's] injury to the date of the trial." 95In relation to the respondent's claim for dimunition in his future earning capacity, the primary Judge noted that the assessment had to be made in accordance with s 126 of the MAC Act, which provides as follows: "(1) A court cannot make an award of damages for future economic loss unless the claimant first satisfies the court that the assumptions about future earning capacity or other events on which the award is to be based accord with the claimant's most likely future circumstances but for the injury. (2) When a court determines the amount of any such award of damages it is required to adjust the amount of damages for future economic loss that would have been sustained on those assumptions by reference to the percentage possibility that the events concerned might have occurred but for the injury. (3) If the court makes an award for future economic loss, it is required to state the assumptions on which the award was based and the relevant percentage by which damages were adjusted." 96The primary Judge considered that an award of damages for diminution in the respondent's future earning capacity should be made, having regard to the following matters:

• the same considerations that applied to the claim for past loss of earning capacity applied to the claim for future loss of earning capacity (at [368]);
• as the respondent aged, his ability to increase his level of sporting activities was unlikely to increase (at [369]);
• the respondent's firm might merge or not continue and the respondent, as a consequence, might suffer an even greater loss of earning capacity (at [370]); and
• the respondent's pain and frustration might adversely affect his motivation (at [371]). 97The primary Judge awarded $250,000 as a buffer for future diminution of earning capacity, for the following reasons (at [373]-[376]):

373. In addressing the requirements of 126(1) of the MAC Act , I consider that the findings I have made with respect to the claim for past loss of earning capacity apply with at least equal force to the claim for future loss of earning capacity. In this regard, I consider that the [respondent] is most likely to continue to practise his profession within the firm Carneys Lawyers Pty Ltd as he has done in the past, probably up to a retirement age of 70 years. In the legal profession it is commonly known that, to varying degrees, some practitioners continue to practise beyond the age of 70 years.
374. Given that I have determined that any award of damages for future impairment of earning capacity should be by way of a buffer, it is difficult to identify the percentage terms of any discount contemplated as requiring adjustment according to s 126(2) of the MAC Act . That said, I have incorporated a small discount to allow for what I consider to be the remote possibility that but for his injury, the [respondent] may have lessened his enthusiasm for continued practice in any event even if he had not been injured, and may have either lessened or ceased his work earlier than at age 70. That conclusion seems unlikely as he clearly derived a great deal of satisfaction from his practice before he was injured, and no sound reason has been identified in the evidence which would reasonably suggest that state would not have continued into his seventies, as was the case with one of the long time principals of the firm who continued to remain in that capacity at the time of the trial.
375. I consider that for the purposes of s 126(3) of the MAC Act , I have sufficiently stated the assumptions I have adopted to base the award of damages for diminution in earning capacity in favour of the [respondent]. 376 I consider that an appropriate lump sum global buffer award for future loss of earning capacity is in the sum of $250,000. I have tested the appropriateness of that sum by analysing it as the equivalent of $550 per week net projected at 5 per cent over 15 years to age 70 years, and then discounted by 15 per cent for possible adverse vicissitudes. That process reveals a sum of $259,462. Taking all relevant discounts into account, including those required by s 126(3) of the MAC Act , I consider that this analysis reveals an award of $250,000 to be an appropriate amount." 98There was no dispute in the present case as to the principles to be applied. They were conveniently stated by McHugh J in Medlin v State Government Insurance Commission [1995] HCA 5; 182 CLR 1, at 16: "In Australia, a plaintiff is compensated for loss of earning capacity, not loss of earnings. In practice, there is usually little difference in result irrespective of whether the damages are assessed by reference to loss of earning capacity or by reference to loss of earnings. That is because 'an injured plaintiff recovers not merely because his earning capacity has been diminished but because the diminution of his earning capacity is or may be productive of financial loss': Graham v Baker (1961), 106 CLR at 347. Nevertheless, there is a difference between the two approaches, and the loss of earning capacity principle more accurately compensates a plaintiff for the effect of an accident on the plaintiff's ability to earn income. Earning capacity is an intangible asset. Its value depends on what it is capable of producing. Earnings are evidence of the value of earning capacity but they are not synonymous with its value. When loss of earnings rather than loss of capacity to earn is the criterion, the natural tendency is to compare the plaintiff's pre-accident and post-accident earnings. This sometimes means that no attention is paid to that part of the plaintiff's capacity to earn that was not exploited before the accident. Further, there is a tendency to assume that if pre-accident and post-accident incomes are comparable, no loss has occurred." 99In Medlin, the plaintiff voluntarily retired early, but it was held that his retirement was a consequence of injuries sustained in an accident for which the defendant was responsible. Thus the plaintiff was entitled to recover compensation for his lost earning capacity during the period between his voluntary retirement and the date he would have had to retire compulsorily. 100As the passage from Medlin shows, loss of earning capacity is not necessarily the same as loss of earnings. In the present case, there was no suggestion that the respondent had an unused pre-accident earning capacity. His case was that his injuries had reduced his ability to attract business to the firm and that in consequence his capacity to derive income had been impaired. As the primary Judge recognised (at [342]), medical opinion as at 27 May 2009 was that the respondent was fit for his work as a lawyer, although he was said to be still restricted in his recreational sports and in some activities in his hobby. 101The difficulty with the primary Judge's reasoning is that the evidence does not support the respondent's contention that his reduced ability to engage in sporting activities diminished his earning capacity. His Honour did not explain why the respondent's inability, for example, to play more than five or six holes of golf prevented him from socialising with clients or prospective clients. Nor were we taken to any evidence that provided an explanation. The primary Judge relied on the respondent's claim that his marketing abilities had been impaired, but this seems to have been an assertion rather than a claim supported by objective evidence. 102The evidence does not support his Honour's finding that the respondent's post-accident earnings were adversely affected by his injuries. Table 1 shows the franked dividends paid to the principals in Carneys for two years pre-dating the accident and two years post-dating the accident. Table 2 shows the number of matters opened by Carneys and by the respondent in each of eight years. TABLE 1 FRANKED DIVIDENDS PAID BY CARNEYS, YEARS ENDED 30 JUNE 2006 TO 2009 Recipients 2006 2007 2008 2009 $ % $ % $ % $ % A 5,000 0.9% - 0.0% 0.0% - 0.0% B 160,000 28.2% 250,000 32.2% 121,000 23.1% 179,821 24.1% C 160,000 28.2% 250,000 32.3% 121,000 23.1% 179,821 24.1% D 81,415 14.4% 24,144 3.1% 26,393 5.0% 52,498 7.0% Respondent 160,000 28.2% 250,000 32.3% 121,000 23.1% 179,821 24.1% E - 0.0% - 0.0% 134,489 25.7% 154,921 20.7% Total Franked Dividends 566,415 100% 774,144 100% 523,882 100% 746,882 100%

TABLE 2 MATTERS OPENED, YEARS ENDED 30 JUNE 2003 TO 2010 2003 2004 2005 2006 2007 2008 2009 2010 Firm 833 886 725 708 718 714 557 534 Respondent 175 171 192 221 202 203 175 166 Respondent as percentage of firm's openings 21.0% 19.3% 26.5% 31.2% 28.1% 28.4% 31.4% 31.1%

103This material shows that the firm as a whole suffered reduced earnings (or at least was able to distribute lower dividents) in 2007-2008, the year the global financial crisis struck. However, the firm's distributions rebounded the following year, more or less to pre-crisis levels. The respondent's proportion of distributions was reduced in 2007-2008 and 2008-2009, but this appears to have been in consequence of the introduction of a new principal into the firm. No submission was made that the reduction in the share was attributable to the injuries sustained by the respondent or to any diminution in his "rainmaking" duties on behalf of the firm. The inference from Table 1 is that all partners suffered a reduction in distributions in 2007-2008, but that the reduction had no evident connection with the respondent's injuries. The return in 2008-2009 to the level of distributions achieved in 2006-2007 reinforces this conclusion. 104It would perhaps be open to infer that the respondent's earning capacity had been diminished if his share of opened files diminished in the years after he was injured (although, as the primary Judge observed, the raw figures have to be treated with some caution). But Table 2 demonstrates that the respondent's proportion of opened files actually increased in 2008-2009 and 2009-2010, when compared with his proportion in all previous years except one. 105In my opinion, subject to the concession made at trial by the Nominal Defendant, the evidence does not establish on the balance of probabilities that the respondent suffered any loss of income in consequence of his injuries or that he would suffer any such loss in the future. The finding by his Honour that the respondent had suffered a compensable loss rested on conjecture rather than on evidence. 106The Nominal Defendant conceded that the respondent was entitled to $10,000 in respect of loss of past earning capacity. If it was necessary to assess damages, I would limit the respondent to an amount of $10,000 for economic loss, subject to a reduction of 25 per cent for contributory negligence. 107As the Nominal Defendant made no submissions on the small Fox v Wood component of the damages award, I say nothing about it.

Loss of Superannuation 108The primary Judge awarded damages for loss of superannuation by allowing 11 per cent of the damages of $310,000 awarded for loss of earning capacity, that is $34,100. His Honour recorded (at [380]) the Nominal Defendant's submission that no allowance should be made because the respondent was not an employee of Carneys, but a director and because there was no evidence that the respondent had made contributions to superannuation prior to his injuries. Since I have concluded that damages for loss of earning capacity should be limited to $10,000, any damages for loss of superannuation would be minimal. In any event, I do not think that the evidence before the primary Judge justified any award for this head of damages. 109The primary Judge rejected (at [381]) the Nominal Defendant's argument that the respondent was not an employee for these reasons: "Before the firm Carneys incorporated, the [respondent] was a partner of the firm. If that arrangement had still been in place, the submission made by the [Nominal Defendant] would have some force, substituting the term partner for director. However, I consider the submission by the [Nominal Defendant] to be unsupported by the weight of the evidence. I take that view because although the [respondent] conceded he was a director of his firm, for tax purposes, in various places, he is identified as an employee drawing a salary: Exhibit 'S'. In those circumstances, I consider the superannuation submission made by the [Nominal Defendant] to involve an incorrect characterisation. I infer from Exhibit 'S' that the [respondent's] earnings, even as a director, constitute the earnings of an employee." 110Exhibit S, to which his Honour referred, included copies of the respondent's income tax returns for the years prior to and after the accident. In three of the four years prior to the accident (2004-2005, 2005-2006 and 2006-2007), the respondent's tax return showed very small amounts as wage or salary income from Carneys (averaging about $5000 per annum), with no income tax instalments deducted. In the 2007-2008 year, no wage or salary income was recorded. In each of the four years, relatively large sums, up to $250,000, were paid to the respondent by Carneys in the form of franked dividends. None of the returns disclosed any sums paid by or on behalf of the respondent as superannuation contributions. There was no other evidence indicating that the respondent received superannuation benefits from Carneys. His income tax return for the year ending June 2009 (the financial year in which the accident occurred) disclosed no wage or salary income and no superannuation contributions or benefits, but recorded substantial franked dividends. 111The primary Judge seems to have assumed that because each of the income tax returns identified the respondent's "Main salary or wage occupation" as "Lawyer", he must have been employed by Carneys. It is not entirely clear why the relevant section of the return was filled out in this way, although it is likely that the intention was simply to record the respondent's occupation for the purposes of statistics compiled by the Australian Taxation Office. 112The information in the income tax returns suggests that from 2004-2005 to 2006-2007 the respondent received, at most, about $5000 per annum from Carneys as wages or salary, but that in the 2007-2008 year, he received no wages or salary from that source. It is possible that the payments of $5000 per annum may have attracted small amounts as superannuation contributions, but there was no direct evidence to that effect and Mr Wheelahan SC, who appeared with Mr Halligan for the respondent, did not submit that any allowance for superannuation should be made by reference to these small amounts. Nor did the evidence explain why the small amounts apparently paid in wages or salary ceased in the 2007-2008 year. 113In this state of the evidence, on the assumption that the respondent could otherwise make out a case of economic loss, I would conclude that he has not discharged the burden of proving that he lost any entitlements to superannuation in consequence of the injuries sustained in the accident.

Conclusion on Damages 114Had it been necessary to assess damages I would have reduced the damages awarded to the respondent by:

• reducing the damages for past loss of earning capacity from $60,000 to $10,000;
• making no award for future loss of earning capacity (assessed by the primary Judge at $250,000);
• making no award for superannuation losses (assessed by the primary Judge at $34,100); and
• reducing the balance of the award ($99,465) by 25 per cent for the respondent's contributory negligence. 115The total award of damages therefore would have been $74,599.

CONCLUSION 116In my opinion, the appeal should be allowed and judgment entered for the Nominal Defendant. I propose the following orders: (1)Appeal allowed. (2)Set aside Orders (1) and (2) made by the primary Judge on 15 March 2011. (3) In lieu thereof order that there be judgment for the Nominal Defendant. (4)Order the respondent to pay the Nominal Defendant's costs of the proceedings in the District Court. (5)Order the respondent to pay the Nominal Defendant's costs of the appeal. (6)Order that the respondent, if otherwise qualified, have a certificate under the Suitors' Fund Act 1951.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 04 April 2012