Webster v Richards

CATCHWORDS: DAMAGES - whether excessive - credibility of plaintiff - proof of pre-existing condition.

LEGISLATION CITED: Motor Accidents Compensation Act 1999 (NSW)

CASES CITED: Jones v Dunkel (1959) 101 CLR 298 Watts v Rake (1960) 108 CLR 158

PARTIES: Antoinette WEBSTER (Appellant) Carolyn RICHARDS (Respondent)

COUNSEL: B J GROSS QC/ H W H BAUER (Appellant) K P REWELL SC/ M A CLEARY (Respondent)

SOLICITORS: McMahons National Lawyers (Appellant) Keddies Solicitors (Respondent)

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40779/05 DC 1051/04

SANTOW JA BASTEN JA

21 DECEMBER 2006 Antoinette WEBSTER v Carolyn RICHARDS Judgment 1 SANTOW JA: INTRODUCTION This appeal solely concerns whether damages awarded for injuries sustained in a motor vehicle accident were excessive. The principal issue is whether damage suffered by the respondent to her neck, and the consequences thereof, were properly attributable to the motor vehicle accident in which the appellant admitted liability, or whether such injuries were derived solely from a pre-existing condition. The other issues on damages are set out below. 2 The appellant places particular importance on the fact that some 15 months before the occurrence of the car accident (6 February 2000), the respondent was referred to Royal North Shore Hospital for an MRI scan and that this was an event which she said in evidence she did not recall. That answer was said to affect her credibility in that: (a) it was suggested that an event of that sort would not be overlooked or forgotten, thus casting doubt on her evidence on this and other matters, and (b) the respondent must be taken to have given an incomplete account of her medical history both to her own experts and to the appellant's expert, Dr Jones, in not disclosing that earlier MRI scan. 3 The appeal also challenges the award for past and future economic loss. This is insofar as it was calculated by reference to her ability to have established a private practice in relationship counselling whereby she would be occupied some 40 hours per week and be remunerated at $100 per hour. 4 There is also a challenge to a discount made to the figure for future economic loss of 20%. It was said by the appellant to be inadequate, based on the respondent's husband being considerably older than she was and having suffered ill health. The appellant submitted that the respondent might be expected to limit her working hours to care for her husband at some time in the future, justifying a larger discount. 5 Finally, there is a challenge to the figure allowed for past and future domestic assistance. It was said to constitute an excessive allowance and said to fail adequately to take into account the prospect that, even if the accident had not occurred, the respondent would have both needed and obtained additional paid or voluntary assistance.

SALIENT FACTS 6 The matter arises out of a car accident on 6 February 2000 in respect of which the Appellant admitted liability. 7 The respondent sustained injuries to her neck and back and suffers from Carpal Tunnel Syndrome ("CTS"). An issue in the appeal is whether some of these physical injuries were pre-existing though there is no challenge to the trial judge, Ainslie-Wallace DCJ's finding that the CTS was caused by the accident; at [32]. 8 The respondent did not seek treatment from her GP between February 2000 (the accident) and August 2000 though she did seek treatment from other doctors. 9 She also suffered a psychological disorder as a result of the accident (either Major Depression (Dr Harris) or an Adjustment Disorder with Depressed Mood (Dr Walden)). 10 The respondent had been involved in a car accident at age 16 (she was 56 at trial). However, her condition settled down after it. She was also involved in a further two unrelated rear-end collisions in June 2001 and February 2003.

Earning capacity and work 11 Prior to the accident, the Respondent was working as a counsellor partly in private practice (individual sessions two days a week and group sessions at $500 per session) and partly for Relationships Australia (three days per week at an hourly rate of $20 per hour). She was in the process of successfully establishing a full time private practice. Her evidence was that her aim was to see forty clients each week at $100 per hour and that by the end of 2000 she was even turning clients away. 12 The injuries to her back and neck now prevent her from sitting for long periods, so precluding extensive private practice. Her evidence was that she could not manage the lucrative group counselling sessions at $500 per session she previously led. 13 The respondent continues to work at Relationships Australia three days per week as a supervisor rather than a counsellor (as the counselling work is said by her to be incompatible with her injuries).

The first instance judgment General Findings 14 The trial judge dealt with the issues carefully and comprehensively. She preferred the evidence of the respondent Carolyn Richards and her son, Dorian Richards, over the evidence of the appellant. The trial judge therefore made favourable findings regarding the nature of the accident ([16], [17]) and in particular found that the impact from the appellant's car when it collided with the rear of the respondent's car was not minor. 15 The trial judge considered there was little medical evidence to support the allegation that the respondent was exaggerating her medical condition: [20]. 16 The trial judge found the respondent to be a credible and reliable witness: [27].

Medical Findings 17 In relation to the CTS complained of, the trial judge found that the condition was as described in Dr Jones and Dr Gawronska's reports (Dr Jones for the appellant) and that the CTS was caused by the accident: [32]. The trial judge stated that there was no suggestion that the CTS had another cause: [32]. 18 The trial judge rejected the view that the respondent had unreasonably failed to mitigate her loss by refusing to submit to surgery to address the CTS: [33]. The respondent was reasonably concerned over the risk of Reflex Sympathetic Dystrophy and its lack of a cure: [33]. There is no challenge to that. 19 The trial judge found that the respondent's back pain was caused by the accident, there being no evidence to the contrary: [35]. The trial judge relied on the evidence of Dr Davis: [36]. 20 The trial judge rejected the appellant's submission that the neck symptoms were a pre-existing condition, but noted that the respondent appeared to have complained of arm and neck pain in 1998: [38]. The trial judge considered that such a position would have required the appellant to provide the MRI report to a doctor for the purpose of giving evidence to assist the court: [39]. 21 The trial judge rejected the view that the respondent pursued a course of physiotherapy after the February 2003 accident to enhance her case even though the treatment was not relieving her symptoms: [40]. That is not pressed on appeal. 22 The trial judge rejected the view that the MAS report by Dr Crowle under the Motor Accidents Compensation Act 1999 ("MACA") dealt with causation and concluded that there was "overwhelming evidence" that the respondent's injuries were caused by the February 2000 accident: [44].

Findings on damages 23 The trial judge assessed general damages with respect to loss of enjoyment of life at $100,000 (by reference to a threshold maximum of $400,000): [45]-[46]. 24 The dispute in relation to economic loss concerned the method for calculating the loss arising from the respondent's reduced capacity: [50]. The trial judge preferred the respondent's method of calculating this loss: [55]. On economic loss generally: (a) The trial judge rejected the appellant's view that this loss could be quantified by calculating a five day week by reference to the two days the respondent continued to work after the accident: [55], [54]; the respondent gave evidence that she had reduced her daily private practice workload after the accident and so such a calculation generated an underestimate: [55]; (b) The respondent had offered two alternative bases for calculating this loss; one used the CCH benchmark for 'Therapists, Counsellors and Psychiatrists' ([52]) and the other based on the respondent seeing 40 patients per week for 46 weeks per year at $130 per hour ([53]); the trial judge recognised that the CCH approach could produce a higher value by including more highly trained psychiatrists in the grouping: [56]; (c) The trial judge considered that the deduction of 52% for expenses was excessive and substituted the figure of 40%: [57]; she appears to have accepted that the respondent's only expenses were $280 per week rent and $110 per month phone bill; (d) The trial judge adopted a figure based on full time private practice commencing on 1 July 2001, with forty clients per week at $100 per hour for 46 weeks per year, with a deduction for actual earnings over the period to the hearing: [58]; (e) The trial judge applied the same figures for future loss, with a 5% discount and a further discount of 20% for vicissitudes: [59]; this further discount was based on the likelihood that the respondent would leave full time work to care for her husband: [59]. 25 For past and future domestic assistance the trial judge adopted a figure of 15 hours per week for the six months after the accident and six hours per week thereafter: [64]. On this basis the threshold minimum under MACA of six hours per week for six months was exceeded: [65]. 26 The trial judge accepted the respondent's estimates as to future medical expenses for GP appointments, physiotherapy and medication but refused the claim for an allowance to cover a gym membership: [67]. The trial judge also accepted as reasonable costs for psychiatric counselling, the ADAPT pain management program and a 'Fit for Work' program: [67]. 27 The trial judge made some adjustments to the figures quoted in the judgment by order on 15 September 2005 (Red, 35). The ultimate judgment for the respondent was $565,138.00, plus costs made up as follows (See appellant's submissions, Orange, 14, for complete list of component awards): (i) Past domestic assistance total - $36,063.19 (ii) Future domestic assistance total - $100,371.60 (iii) Future medical expenses total - $46,689.54 (iv) Past medical expenses total - $11,933.35 (v) Past economic loss total - $111,759.80 (vi) Future economic loss total - $132,335.61, and (vii) Interest - $23,946.00

Grounds of Appeal Ground 1 28 When dealing with the facts that: (a) on 3 November 1998 (15 months before the accident on 6 February 2000) the respondent (Plaintiff) had an MRI scan of her cervical spine at Royal North Shore Hospital, the report of which described the respondent as "this patient with arm pain" and described changes at C5/6 and C6/7, this all being contrary to the respondent's histories to numerous treating and medico-legal doctors and to the respondent's sworn evidence in examination in chief, as to the history of her previous good health; and (b) on 12 February 2000 (six days after the accident on 6 February 2000) the respondent told Susan Eaton, her treating physiotherapist (who made detailed contemporaneous handwritten notes), that she had a "grinding sensation" in her neck and that before the accident on 6 February 2000 she had a "powdery" sensation in her neck when she turned her head;

her Honour erred: (a) by wholly failing to give adequate consideration to the destructive effect of this evidence on the respondent's credibility as an historian to doctors and as a witness in Court, given her numerous contrary histories given to doctors and her evidence-in-chief regarding the previous state of her neck and arms; (b) by failing to address the significance of the manner in which the respondent responded in cross-examination to questioning concerning the MRI scan of 3 November 1998; (c) by wholly failing to give adequate consideration to the effect that this evidence had upon the weight which could be given to opinions expressed in numerous medical reports which were based on contrary assumptions as to her previous health; (d) by ruling that the appellant (defendant), rather than the respondent, should have given this information and the MRI scan at least to Dr Jones, the respondent's doctor (expert), "to assist the Court with its meaning in the context of this case"; (e) by failing to draw adverse inferences against the respondent from the failure on the respondent's behalf to call any doctor to give evidence or to obtain and tender any supplementary report by any doctor as to the effect of belated revelation of this information upon his or her medical opinions as to causation of the respondent's cervical spine disability, right arm disability and radiological changes seen in x-rays, CT scans and MRI scans; (f) by failing to reach the conclusions, as urged by the appellant, that the respondent had neck symptoms before the accident and that they were greater than she indicated in evidence.

Ground 2 29 Her Honour erred: (a) in making an excessive award for past and future loss of earning capacity by finding that the respondent's probable earnings in full-time practice by 1 July 2001 should be calculated based on 40 clients per week @ $100 per hour for 46 weeks each year and in making an inadequate 20% discount for vicissitudes; and (b) in failing to consider the application of s126 of the MACA.

Ground 3 30 Her Honour erred: (a) in making an excessive allowance for past and future domestic assistance by failing to adequately take into account the prospects, and indeed likelihood, that, in any event, even if the accident had not occurred, the respondent would have both needed and obtained additional paid or voluntary assistance; and (b) in failing to consider the application of s128(2) of the MACA.

DISPOSITION Ground 1 - the 3 November 1998 MRI scan 31 To do justice to this argument I need to put the supposed significance of the 1998 MRI scan in context. The respondent, aged 56 at the date of trial, gave evidence of the rear-end car accident that she suffered at the age of 16, causing some whiplash. The trial judge accepted her as a witness of credit. Her evidence was that the symptoms were resolved within a couple of months. Her evidence was that she had no significant neck, back, arm or shoulder problems until after the accident that occurred on 6 February 2000. 32 The 1998 MRI scan was done in the outpatient clinic at Royal North Shore Hospital some 15 months before the accident on 13 November 1998. While the actual MRI scan document was not in evidence, there was a written report which, pursuant to subpoena, was available for inspection by the appellant some seven months before the District Court trial began, namely from 3 August 2004. 33 I reproduce the relevant part of the report below (Blue, 566): " MRI C/SPNE

Sagittal T1 and T2 weighted as well as axial gradient echo images were obtained in this patient with arm pain.

There are minor osteophytic bars posteriorly at C5/6 and C6/7 without cord compression or significant canal narrowing. There are again minor neuro central osteoarthritic changes bilaterally at C5/6 and somewhat more on the right side at C6/7. The degree of narrowing at C6/7 is mild to moderate and that at C5/6 is mild.

No disc herniation can be seen. The cranio-cervical junction and cord appear normal.

SUMMARY: Changes of spondylosis from C5 to C6 with mild to moderate right neuro central narrowing of the neuro foramen at the C6/7 level ? significance.

S. BLOME" [emphasis added] 34 While the MRI scan refers to the respondent as "the patient with arm pain" it will be noted that there is no mention of neck pain or neck symptoms. Moreover the report is entirely unremarkable in describing degenerative changes, not themselves severe, at C5/6 and C6/7, as could be expected in a person around the age of 50. 35 Much was sought to be made by the appellant of the fact that the respondent had not voluntarily produced any documentation explaining how the 1998 MRI scan came to be undertaken. If one accepts the respondent's evidence that she had no recollection of the MRI scan, as did the trial judge who found her an honest witness, it is difficult to see how this really assists the appellant. It is true that the appellant's solicitors could have availed themselves of the information concerning the MRI scan and made enquiries such as from her then treating doctor or of Royal North Shore Hospital to see if there was a referral notice. But accepting that this information only emerged at trial, further information could still have been sought thereafter during the trial (which took place between 7 April 2005 and 3 June 2005). 36 A further point which the appellant relies upon is the supposed lack of credibility in the respondent's evidence in cross-examination that she did not recall having an MRI of her cervical spine at the time. The respondent however frankly acknowledged that if the appellant had evidence that she did have such an MRI then she must have done; Black, 49.53-50.23. Moreover, in cross-examination it was never put to her that she was lying in saying that she had no recollection of the MRI scan. 37 The appellant's difficulty in making anything of all this is exacerbated by the fact that the appellant did not seek either to have its expert Dr Jones or any of the respondent's experts comment on the significance or otherwise of the 1998 MRI scan. Much is attempted to be made of the fact that the respondent herself did not volunteer that information of the 1998 MRI scan to the relevant doctors. But if one accepts the trial judge's credit-based finding that she was a truthful witness and then takes cognizance of the unremarkable result disclosed by the 1998 MRI scan, the appellant's attack leads nowhere. 38 The appellant then attempted to put the argument on a Jones v Dunkel basis. However, the short answer is that the 1998 MRI scan required no explanation from the respondent. It cast no obvious doubt on the respondent's evidence that she did not suffer any significant symptoms in her neck before the motor vehicle accident. If it was to be the appellant's case that an unremarkable MRI scan compelled the trial judge to reject the respondent's evidence, it follows that there was an evidentiary onus on the appellant to advance at least some medical support for that otherwise improbable submission. That was precisely the way in which the trial judge dealt with the matter at [38-[39]. The trial judge was perfectly justified in so doing. 39 A case based upon the existing symptoms being the true cause of damage or part thereof was disavowed by the appellant. The appellant properly had regard to authorities such as Watts v Rake (1960) 108 CLR 158 which place the evidentiary onus upon the defendant to disentangle a pre-existing condition as a causal factor, once disabilities of the plaintiff have been established from the accident. That was what here occurred. 40 Finally, it is not without significance that in every report of the appellant's expert witness, Professor Jones, bar the final report dated 22 March 2005 (the latter dealing with CTS) Professor Jones referred to the fact that the respondent had mild degenerative disease in her spine. Professor Jones certainly did not relate that degenerative disease to the accident of 6 February 2000; he referred to it as being "of a constitutional nature"; Blue, 488. It is clear therefore that he attached little or no significance to the existence of mild degenerative disease. It is fair to say, as the respondent contends, that his opinion would have been no different, and no more persuasive, had he been aware of the MRI scan on 3 November 1998. 41 There were also the clinical notes of the physiotherapist, Susan Eaton; Blue, 337. On 12 February 2000 Ms Eaton recorded, a few days after the accident on 6 February, that the respondent suffered a "powdery sensation" over the "past few years" on rotation of her neck, "but no pain"; Blue, 337V. That "sensation" was so minimal that the respondent could not recall it. It does not, to my mind, point to the respondent suffering any pain in her neck during the years preceding the accident. In that regard I agree with the written submissions of the respondent at Orange, 51 paras 35-6. "35. The Appellant relied on the clinical notes of a physiotherapist, Susan Eaton [Blue 337]. On 12 February 2000, Ms Eaton recorded that, prior to the accident on 6 February 2000, the Respondent suffered a 'powdery sensation' over the 'past few years' on rotation of her neck, ' but no pain ' [blue 337V]. That 'sensation' was so minimal that the Respondent could not recall it; in any event, her work, domestic and social activities prior to the accident demonstrate that it was of no practical consequence; there was not a scintilla of evidence to suggest that the Respondent suffered any pain in her neck during the years preceding the accident.

36. It is to draw a very long bow indeed, to submit, as the Appellant does, that the MRI scan of 3 November 1998, coupled with the insignificant complaint to Ms Eaton, destroys the Respondent's credibility; or that it diminishes the weight which could be given by the Trial Judge to the Respondent's medical evidence. The Trial Judge correctly rejected that submission."

Conclusion 42 This causation ground as to damage has no substance and must fail.

Ground 2 - past and future economic loss 43 The argument put by the appellant turns on the word "optimally" which was distilled from her evidence by the trial judge at [47] where Her Honour said "optimally, she said that she would have liked to see 40 clients each week at an hourly rate of $100". 44 To that evidence, one needs to add the fact that the respondent claimed that in December 1999, as the trial judge noted at [5] the respondent had commenced part-time private practice and shared rooms in Balmain, charging about $90 or $100 per hour. As the trial judge recorded, "she was surprised at how successful the practice was and very shortly after starting she had a waiting list of clients wanting her services and she was turning people away. …originally she thought it might take her 12 months to develop the practice but she had revised that estimate to six months given the success of the practice. Her idea was to work five nights seeing six to seven clients during the day and conducting group sessions at night. Depending on the size of the group she could charge $500 for a group session." 45 The trial judge made the calculation of both past and future economic loss on the basis of 40 sessions a week at $100 per hour. Conservatively, the trial judge made no allowance for her charging $500 for group sessions at night and moreover did the calculations on the basis that she would have started some seven months or so later than December 1999. As appears common ground, the calculation of the respondent's net loss from her injury was based upon an accountant's report (Blue, 157) whereby the net loss was calculated at $400 per week, there being also a discount for vicissitudes of 20%. 46 While there is necessarily an element of estimation in such a calculation, I consider that the trial judge's estimation of her past and future economic loss was within the bounds of a discretionary determination warranting no appellate intervention. 47 The 20% discount was similarly within the bounds of a proper discretionary determination. That discount was on account of the vicissitudes of life, and was greater than the conventional 15%. The basis for doing so could only have been that the respondent's husband was considerably older than she was and had suffered ill health. While it might be assumed that there was a possibility that the respondent might limit her working hours to care for her husband at some time in the future, this was not based on specific evidence put by the appellant. I find no basis in the evidence to justify a larger discount nor any indication that the trial judge failed to expose her reasons on this or the earlier matter of the calculation of past and future economic loss.

Ground 3 - past and future domestic care and assistance 48 The trial judge awarded damages for domestic care and assistance on the basis of 15 hours per week (the appellant had sought 22 hours per week) for six months after the date of the accident on 6 February 2000 and thereafter on the basis of six hours per week for the rest of the respondent's life. It should be born in mind that her working life was no more than nine years given a retirement age of 65 and the respondent's age at the time of trial. 49 Domestic assistance had been provided gratuitously by the respondent's husband and sons up to the date of accident, supplement by paid cleaning work. 50 The trial judge assessed damages for the cost of future domestic assistance at commercial rates, on the basis that the respondent would have to pay for the care she required. I agree that this was a proper assumption, having regard to the age and ill health of the respondent's husband. 51 The appellant complains that these findings are inconsistent with the findings as to economic loss. The appellant argues that, had the respondent been in full-time private practice as a counsellor, as she intended, she would in any event have required assistance in the house and garden. 52 I agree with the respondent's submission that there is no basis for that complaint. From July 2001 when the trial judge found that the respondent would, but for the accident, been in full-time private practice, only six hours per week of assistance was awarded. The respondent's work commitments would not have prevented her undertaking six hours domestic work in her home and garden, had she been physically able to do those tasks. The evidence was that she was an active gardener and an active person well able to have worked 40 hours (or more) per week in private practice and also attend to her domestic and gardening chores, as she did prior to the accident. Indeed prior to the accident her total working hours were at least 40 hours per week. 53 I do not consider there is any basis for challenging the trial judge's award of damage in the amounts she awarded for past and future domestic care and assistance.

OVERALL CONCLUSION AND ORDERS 54 In my opinion the appeal should be dismissed with costs. There was little substance in any of the grounds of attack upon the trial judge's determination. The Court has been asked merely to foreshadow an order for costs so as to permit any submissions on the appropriate cost order in light of any relevant matters that may bear on it. Accordingly, I propose the appeal be dismissed. 55 As to costs of the appeal, I consider on the material before me that these should follow the event. However, the actual order for costs (if not agreed between the parties) will be the subject of further consideration in light of written submissions in the first instance from the respondent to be filed by 16 January 2007 and from the appellant in reply within a further seven days. 56 BASTEN JA: The appeal should be dismissed for the reasons given by Santow JA. 57 Costs orders being largely routine, the Court can expect that these will be agreed between the parties, acting reasonably. If resolution is not possible, I agree with the directions indicated by Santow JA.

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