Visyboard Pty Limited v Ranieri [1999] NSWCA 331 | Case summary

1 BEAZLEY JA: This is a defendant's appeal from a decision of Dent DCJ in which his Honour awarded the plaintiff (the respondent to this appeal) damages for personal injury which he sustained during his employment with the defendant/appellant. The appellant appeals only against the award for past and future economic loss. 2 The respondent injured his back on 18 April 1994 when, in the course of his work for the appellant, he lifted a 44 gallon drum of glue onto a forklift and ruptured a disc. He continued work with the appellant until 18 February 1997, when his back "locked up". The respondent has not worked since. His employment was subsequently terminated by the appellant on 31 October 1997. In the letter of termination the appellant advised the respondent: "Unfortunately, Visyboard Pty Ltd is unable to continue your employment. We have come to this decision after a close examination of your current medical condition as certified by your treating doctors which indicates that you are unable to return to your pre-injury duties as a supervisor. Rehabilitation, which the company regards as a means to return injured employees to their pre-injury employment, has not been successful. In these circumstances we, unfortunately, do not have any suitable positions available for you at this time." 3 The respondent's personal history was that he was educated in Italy until the age of 11. He later came to Australia with members of his family to join his father and sister, who were already here. He has always worked in unskilled jobs, although his rapid promotion to foreman in the employment of the appellant is testament to his innate organisational abilities and leadership qualities. 4 The reports of ten medical witnesses were tendered at trial. None were called for cross-examination. The trial judge awarded $77,139 of past economic loss on the basis that the respondent had been totally incapacitated for work from the date of ceasing to work until the date of hearing. He awarded $229,544 for loss of future earning capacity, on the basis that he had lost two thirds of his earning capacity. 5 The appellant submitted that the medical evidence did not support a total loss of earning capacity up to the date of hearing and further submitted that that award was inconsistent with an assessment of a two thirds loss of earning capacity commencing the day after the hearing loss. It was submitted that inconsistency itself revealed error in the trial judge's assessment. As to future economic loss the appellant submitted that there was in fact no loss of earning capacity. 6 In both his written and oral submissions, counsel for the appellant referred the Court to the various medical experts' reports tendered at the hearing. Those reports were remarkable for almost totally preceding the date of the incident on 18 February 1997 which, on the respondent's evidence, caused him to cease work. Dr Mahoney, however, did examine the respondent after that time. The effect of Dr Mahoney's evidence was that when he saw him, which was about two weeks before the February 1997 incident, he considered the respondent to be fit for work not involving significant bending or lifting. When he saw him on two occasions in periods of about three weeks and five weeks after February 1997 he considered him to be unfit for work and concluded overall that the respondent: "… has been considered fit for duties as outlined (as a supervisor) and, in order to minimise an exacerbation of his symptoms, I would suggest he restrict his future activities to activities not involving significant bending or lifting." 7 The trial judge stated that Dr Mahoney had expressed an opinion that the respondent was unfit for work up until the date of termination of his employment on 31 October 1997. His Honour was in error in making that finding as Dr Mahoney's last consultation was in March 1997. The respondent contends, despite the error, it was still open for his Honour to infer that the respondent in fact remained unfit up until that date. The appellant contends that Dr Mahoney's evidence is inconsistent with the finding of total incapacity and he makes that submission as from the date of cessation of employment on 18 February 1997, notwithstanding the incident that occurred on that day. 8 The appellant also referred to the report of Dr Smith of 2 March 1998, that being a report which did post-date the February 1997 incident. That report concluded that: "I would not anticipate any spontaneous improvement or attributable deterioration and the present situation could reasonably be regarded as permanent for assessment purposes. As he has not worked for over a year and had significant other impairment I am doubtful of his returning to the work force. If his back injury is considered in isolation he would be able to manage a wide range of duties provided heavy, repetitive or provocative lifting and prolonged or repetitive bending could be avoided and could change posture at reasonable intervals and at will." 9 The appellants also say that this opinion is not consistent with a finding of total incapacity for work since February 1997. 10 It is worth noting, however, that Dr Smith in his report also reported that the respondent regarded himself as capable of only light physical activity and had reported to Dr Smith that walking 500 metres, sitting and driving for half an hour were possible but that he needed help with his socks and that his sleep was regularly disturbed by back pain. Dr Smith reported that a CT scan had showed a moderate central protrusion at L4-5 and that the symptoms: "… are consistent with this diagnosis which is consistent with the injury described." 11 Dr Anderson provided a report dated 9 October 1996, that is, preceding the February 1997 incident. He concluded that the respondent "is fit to continue with his current occupation at its existing level … H[e] is not fit to return to his previous heavy physical activities of lifting pallets and manoeuvring drums of glue". Dr Bodel, in a report of 6 January 1997, again preceding the February 1997 incident, expressed the opinion that the respondent "should be able to continue in work as a foreman indefinitely". 12 Dr Stephen provided two reports, dated 3 June 1996 and 10 February 1997, neither of which contain an opinion as to the respondent's work capacity. The final report notes that the respondent's "symptoms have remained unchanged over the past 18 months and they are likely to persist in low-grade fashion into the indefinite future". The appellant argues that this opinion supports the contention that, to the extent that the respondent was capable of performing selected duties over that period, he should have remained capable of continuing to perform similarly thereafter, and that such a finding is not consistent with his Honour's finding of total incapacity. 13 The respondent accepts that the medical evidence supports the proposition that the respondent retained a residual earning capacity which permitted him to perform selected duties of the sort he had performed up to and including February 1997, but contends that such residual capacity was interrupted for a period when his back locked up and continued up until the date of hearing. 14 In that regard the respondent himself had given evidence that he did not consider that he would be able to do the supervisor's job at Visyboard. The trial judge accepted the respondent as an honest witness and found no reason to reject or qualify any part of his evidence. It was against this background that the trial judge held: "I am satisfied from the plaintiff's evidence and the evidence of Doctor … Smith and Doctor Mahoney that the plaintiff has been effectively disabled from working in any employment up to the present time by the exacerbation of pain and symptoms which occurred in February of 1997 …"

15 Notwithstanding the error in his Honour's judgment as to the effect of Dr Mahoney's report, I am of the opinion that, on the totality of the evidence and particularly in circumstances where the respondent was unreservedly accepted by the trial judge, the finding was open to his Honour on the evidence. 16 As to the future economic loss, his Honour stated: "[T]he [respondent] has been rendered a permanent light-duties person by the subject accident and … it would be unrealistic to believe that the [respondent] will achieve comparable employment as a highly paid, working foreman in the future, let alone employment as a labourer. His future, if any, must lie in some form of self-employment in which he has complete control over his exertion activities and hours of work, and given the level of back disability and his lack of general education and higher management training I am of the view that any assessment of the diminution of the [respondent's] established earning capacity which is less than two-thirds of the capacity proven in the employ of the defendant would be a positive injustice to the [respondent]." 17 Such an assessment was open to his Honour on the evidence. Indeed, there was some medical evidence to that effect, albeit given prior to the February 1997 incident. That was the evidence of Dr Anderson in his report dated 9 October 1996. 18 In my opinion, it was open to his Honour to find some suitable demarcation point when the period of total incapacity ceased. He found that to be the date of hearing. It could have been argued that it ceased prior to that. It equally could have been argued that he had continuing total incapacity for a period after the hearing. Having regard to the whole of the evidence and his Honour's acceptance of the respondent, it was clearly open to the trial judge to choose the point, which in fact was the date of hearing, for the period of total incapacity and he thereafter assessed him as being partially, or having a partial interference with his earning capacity to the extent which his Honour did. 19 I consider that the appeal should be dismissed with costs. 20 DAVIES AJA: I agree with Beazley JA. I make these further observations. 21 As to past loss, the crux of the appellant's submission was: "It is apparent from his Honour's judgment that he assessed the plaintiff's future loss of earning capacity at the rate of two-thirds of his pre-injury capacity for work. There is no warrant on the evidence for an assessment of the respondent's past loss of earnings at a different rate." 22 The submission put the point that, in a calculation of damages resulting from a loss of earning capacity, the assessment for past loss and for future loss should be made on the same basis. In my opinion, that submission proceeds on a misapprehension of the law. It is not in dispute that an injured plaintiff recovers damages because his earning capacity has been diminished and because the diminution of his earning capacity is, or may be, productive of financial loss. That is the basis of the calculation. However, in the assessment of damages, the Common Law shows a preference for certainty, for actuality over prophecy. Therefore, in the assessment of past loss, the Common Law looks to the losses that have actually occurred up to the date of trial. This point was put in Graham v Baker (1961) 106 CLR 340 at 346-347 when Dixon CJ and Kitto and Taylor JJ said: "So far the matter has been discussed as if the right of a plaintiff whose earning capacity has been diminished by the defendant's negligence is concerned with two separate matters, i.e. loss of wages up to the time of trial and an estimated future loss because of his diminished earning capacity. It is, we think, necessary to point out that this is not so. A plaintiff's right of action is complete at the time when his injuries are sustained and if it were possible in the ordinary course of things to obtain an assessment of his damages immediately it would be necessary to make an assessment of the probable economic loss which would result from his injuries. But for at least two obvious reasons it has been found convenient to assess an injured plaintiff's loss by reference to the actual loss of wages which occurs up to the time of trial and which can be more or less precisely ascertained and then, having regard to the plaintiff's proved condition at the time of trial, to attempt some assessment of his future loss." (emphasis added) 23 The result in Graham v Baker was that their Honours held that sick pay which an injured plaintiff had received should be taken into account in lessening the amount of the plaintiff's damages, for it had reduced the amount by which his diminished earning capacity had been productive of financial loss. I need hardly add that sickness benefits are not relevant at all to the question of ability to earn but they are relevant to, and by reason of the decision of the High Court are taken into account in, the assessment of proved actual loss up to the time of the trial. 24 In the present case, the respondent, Mr Frank Ranieri, proved that he was willing to work but was unable to do so. The trial judge accepted that he was unfit for employment at the time of the trial. Mr Ranieri's actual losses were proved and that figure was taken into account. 25 The appellant, Visyboard Pty Limited, did not put forward at the trial any matter that ought to have been taken into account by way of mitigation of those proved losses. It did not put, for example, that an offer of employment had been made to Mr Ranieri which he had rejected. Indeed, a fact before the trial judge was that it was Visyboard's dismissal of Mr Ranieri from its employment which had resulted in his loss. In my opinion, the trial judge was correct in his approach to the assessment of past losses. 26 As to future losses, the crux of the submission was, and I quote: "There is an irreconcilable tension between the respondent's work history and the medical evidence on the one hand and a finding that the respondent will carry into the future an earning capacity of no greater than one-third of his pre-injury capacity." 27 This submission highlighted the distinction between the medical experts' view of the diminution in physical capacity and the assessment made by the trial Judge of the loss of earning capacity. The submission suggested that there should be a correlation between the loss of physical capacity and the loss of earning capacity. Again, in my view, the submission proceeds on a misapprehension of the law. 28 Earning capacity involves an ability to engage in remunerative employment and this itself involves an ability to find an employer who is prepared to engage and remunerate the disabled person. 29 Lord Atkinson said in Ball v William Hunt & Sons Limited [1912] AC 496 at 505: "The earning of wages depends as much on the demand for the workman's labour as it does upon his physical ability to work. If because of his apparent physical defects no one will employ him, however efficient he may be in fact, he has lost the power to earn wages as completely as if he was paralysed in every limb.

Visyboard Pty Limited v Ranieri

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