$20,500 to $24,000 per annum with the capacity to earn in the
range of $27,000 to $33,000 per annum with increasing experience
and years of service."
21.
On the basis of that evidence, as a starting point for the assessment of
damages under this head, His Honour assumed a net weekly
loss of $400.
22. His Honour then had regard to actuarial evidence as to the value of an
appropriate annuity to express the present
value of a net loss commencing on
the attainment of age 16. The respondent tendered actuarial evidence as to
that, based on an interest
rate of 3% per annum. The appellant sought to
persuade the learned trial Judge that although 3% had been approved by the
High Court
as an appropriate rate to apply in such instances (see Todorovic v
Waller [1981] HCA 72; (1981) 150 CLR 402), as nearly 11 years had passed since that decision
of the High Court, the time had come for a review of the percentage.
23. His
Honour rejected that argument, and it was not suggested on the appeal
that in doing so he was wrong. Based then on an interest rate
of 3%, His
Honour adopted a multiplier of $1,220, which applied to a net weekly loss of
$400 yielded a figure of $488,000. His Honour
then allowed for what he
described as "favourable and unfavourable contingencies and other relevant
circumstances" before reaching
an award, before apportionment, of $350,000.
24. On appeal, the appellant complained that the approach adopted by the
learned trial
Judge is erroneous in two respects. The first argument advanced
was that if the Court was prepared to accept the appellant's contention
that
the award for future care should have been postulated on the basis of
institutional care (contrary to the finding of the learned
trial Judge), given
that institutional care would include accommodation, meals and the like, which
would normally be paid for by
the plaintiff out of her earnings, the amount to
be awarded under this head should be reduced accordingly.
25. The other argument
was that the learned trial Judge had failed to allow
sufficiently for contingencies and for the cost of earning income.
26. Whatever
merit there might have been in the first argument, in my
opinion, it should be rejected, along with the view which I express later
in
this judgment, that the learned trial Judge has not been shown to be in error
in assessing the damages for future care other than
upon the basis of care in
an institution.
27. As to the second argument, it must be accepted that given the fact that
the plaintiff
was a child of tender years at the time of the accident, the
allowance for loss of future earning capacity is more than usually
speculative.
Be that as it may, it appears to me that there was an ample basis
in the evidence of Ms McAuliffe, which was not challenged on the
appeal, to
support the primary calculation made by the learned trial Judge, and in my
opinion, his deduction for contingencies has
not been shown to be inadequate.
28. That is not an end of the matter. This head of damages is the subject of
a cross appeal. The
respondent advanced an argument that the award under this
head should have been in the order of $500,000. In support of the cross
appeal
the respondent contended, inter alia, that in adopting an actuarial multiplier
of $1,220, the learned trial Judge had wrongly
made a calculation on the basis
of the plaintiff's reduced life expectancy rather than the period over which
she might have been
expected to earn an income if her life span had not been
curtailed by the accident.
29. The respondent is correct with respect to
the learned trial Judge's
choice of a multiplier. The multiplier of $1,220 was appropriate for a
calculation commencing on the respondent's
17th birthday, projected during a
period representing her normal life expectancy, reduced by 20%. Furthermore,
the question of principle
involved in the period over which the loss shold be
calculated, should be resolved in favour of the respondent's contentions,
having
regard to the decision of the High Court in Skelton v Collins [1966] HCA 14; (1966)
115 CLR 94 (see also Pickett v British Rail Engineering Ltd (1980) AC 136).
30. The appropriate figure to have been adopted was $1,404, being the value
of an annuity of $1 per week, commencing on the respondent's
16th birthday,
and projected through the period representing the normal life expectancy for a
woman of that age. Applied to a net
weekly loss of $400, that would give rise
to a gross calculation of $542,000.
31. The learned trial Judge, after allowing for contingencies,
awarded 70% of
the capitalised net weekly loss. In my opinion, that approach was sound.
Applying the same percentage to $542,000
yields a net figure of approximately
$380,000, and increase of $30,000 over the amount awarded by the trial Judge.
The appeal against
this head of damages should be dismissed, and the cross
appeal allowed to the intent that the award on this head be increased by
$30,000 before apportionment. Future Care For this head of loss the learned
trial Judge allowed, before apportionment, a total amount
of $3,846,326.
Against that assessment, the appellant and the respondent have both appealed.
32. As I have already indicated, at
the time of the trial the respondent was
living with her mother and step-father. Her mother, and to the extent that he
had the opportunity
to do so when not working, her step-father, devoted
themselves to the respondent's welfare from the time of the accident. At the
time of the accident, the respondent's mother was engaged in employment and
earning approximately $300 per week net. She gave up
that employment in order
to care for the respondent, and she has not worked since. Given that the
respondent requires, as His Honour
found, attendant care for 24 hours a day,
it is not surprising that for the period leading up to trial they also
received some outside
assistance. Despite the outside assistance, the main
burden of looking after the respondent has fallen on her mother. Clearly she
could not be expected to continue to do so indefinitely. The learned trial
Judge accepted that, and observed: "Mrs Burford gave
evidence that she was
exhausted and felt unable to continue caring for her daughter in the manner
and to the extent she has necessarily
had to so far. Her evidence was
supported by her husband and Dr Matthews." At the trial it appears that
counsel on both sides agreed
that the respondent needed attendant care for 24
hours a day for the rest of her life. Beyond the agreement as to that,
however,
there was a substantial divergence in the cases presented on each
side.
33. The respondent sought an award on the footing that the
cost of future
care should include the cost of a registered nurse for 24 hours a day. On
figures which were proffered to the learned
trial Judge in support of that
contention, and applying an appropriate multiplier, the weekly cost
capitalised at a figure over $7.8
million, which would not allow for
housekeeping, domestic, handyman or driving help.
34. The appellant, on the other hand, contended
at the trial that if it was
right to suggest that the respondent needed 24 hours registered nursing care
each day, which the appellant
disputed, this was more appropriately given at a
hospital such as Julia Farr Centre which could be provided, on the contention
of
the appellant, at a weekly cost of $1,575. Having regard to evidence
suggesting that the Julia Farr Centre would not receive the
respondent until
she was aged 16, and on the footing of actuarial evidence calculated from that
age to age 60 years, the appellant
contended at the trial that the appropriate
amount to allow for care at Julia Farr Centre or some such institution would
be $1,877,400,
to which should be added an additional sum of approximately
$340,000 for the two year period to the age of 16, making a gross sum
of the
order of $2.2 million.
35. It will be seen from the observations which I have so far made, that the
learned trial Judge was
confronted with submissions on each side leading to a
vast difference in the amounts which the parties suggested it was proper to
award on this head.
36. In approaching his assessment of this head of loss, His Honour referred
to, and clearly accepted, the evidence of Dr Clive Matthews,
a general
practitioner who had seen the plaintiff regularly since November 1988, Dr Yeo,
a spinal rehabilitation specialist and head
of a spinal injury clinic at Royal
North Shore Hospital, Sydney, Dr Harald Fodstad, described as "a world
authority on phrenic nerve
pacers", and Sister Reynolds, who had nursed the
respondent at Adelaide Children's Hospital and subsequently at home since May
1992.
37. His Honour observed that all of those witnesses were strongly of the view
that the respondent "should be cared for in her own
home, and by the
provision, inter alia, of 24 hours of registered nursing care each day".
38. His Honour heard evidence also from
Dr Peter Last, the former Director of
the Julia Farr Centre, whose evidence was that in his view the respondent did
not need 24 hour
registered nursing care. He thought that four hours
registered nursing care per day would be adequate, preferably in two sessions,
and that for the rest of the time she should be cared for by "a small group of
trained care attendants with input from specialists".
Although some particular
skills were needed in order to see that the respondent coped adequately with
the respirator and phrenic
nerve pacer, there was evidence to suggest that
such skilled care-givers were available.
39. His Honour eventually came to the conclusion
that the proper basis upon
which to assess the award for the respondent's future care was to proceed on
the footing that the respondent
would be cared for, and live with, her mother
and step-father until the age of 18. He thought that from then on it was
appropriate
to assess the damages under this head on the footing that she
lived independently in her own or shared accommodation.
40. On the
basis of those findings, His Honour concluded as follows:
"In assessing the award for the plaintiff's future care, I
consider
a starting point is the capitalized cost of 24 hours a
day attendant care service at $15.75 an hour, which amounts to
$2,646
per week. Using a multiplier of $1,173 (see Exhibit P27), a
capital sum of $3,103,758 is required. In addition I propose to