Personal Injury Damages (Economic Loss) for Smarties – QLD Court of Appeal

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By David Slatyer, Partner and Eula Davis, Undergraduate

The QLD Court of Appeal maintained the trial judge’s assessment of past economic loss but overturned that for future economic loss, regarding a plaintiff who suffered injuries in a motor vehicle collision.  In doing so it increased the total award of damages from $314,345 to $543,988 and, consequently, awarded the appellant her costs on the indemnity basis (because the revised award exceeded the appellant’s earlier offer to settle). The case reinforces the application of some fundamental principles in the assessment of such damages. Re Sutton v Hunter & Anor [2022] QCA 208.

Background Facts

The appellant suffered personal injury in a car accident in 2015. The most significant injury was post-traumatic stress disorder (“PTSD”). At first instance, liability was admitted. However, the exact quantum was in dispute. The total award of damages made by the primary judge was $314,345 (including $180,336 for past loss of income and $77,357 for future loss of income).

Past Loss of Income

The grounds of appeal relating to past loss of income were dismissed, meaning those damages remained at $180,336.

Assessment of the appropriate level of damages was complicated by the appellant’s work history. Such history demonstrated consistent employment, but this was across a variety of jobs. At the time of injury, the appellant had been out of the workforce for over a decade and her possible employment in the three businesses referred to in the pleading was uncertain. On this basis, the primary judge applied s55 of the Civil Liability Act 2003 (Qld) which governs the award of damages for loss of earnings when the loss cannot be precisely calculated.

Appellant contends there was inadequate consideration of loss of chance
In the appellant’s original Statement of Claim she submitted that her injuries had (i) prevented her from working in a cleaning business run by her husband, (ii) to lose the opportunity to launch an online business that she planned to advance, and (ii) thwarted her intentions to reassess another business plan once her youngest child was settled at school.
It was held that the three business opportunities should not be separately evaluated as lost valuable commercial opportunities. Rather, they are to be viewed as pleas supporting the material fact that the appellant would have returned to full-time remunerative work in some capacity in early 2015, but for her injuries. The primary judge was correct in not using the commercial viability of each business opportunity to inform his quantification of past economic loss.

Appellant contends that there was an under-assessment of the prospects of work capacity
Assessing the appellant’s earning capacity was an evaluative judgement and as such the Court of Appeal noted it should exercise restraint. On that basis, it found no error in the primary judge’s evaluation that earning capacity was to be capped at two days a week for four years and three days a week for the next three years.  Further, the rate used to determine the value of lost earning capacity was correctly derived by the primary judge from the average weekly earnings for females and the argument that such rate was inappropriate was dismissed.

Future Loss of Income

The primary judge was found to have erred by not making an allowance for permanent impairment of earning capacity. It was held that the evidence, particularly expert medical evidence, was incapable of supporting the trial judge’s view that the appellant would experience no ongoing loss in earning capacity after 2025 (10 years after the incident).
The award for future economic loss made by the primary judge of $77,357 was set aside and substituted by the amount of $307,000. This new figure includes an allowance for losses accrued after 2025.

Appellant contends that they would be incapable of making a full recovery by 2025
Conflicting expert evidence was received at trial. However, in aggregate, the evidence was incapable of supporting the view that the appellant would experience no diminution in capacity after 2025. Thus, the Court of Appeal proceeded to make its own finding of fact relating to future economic loss.

In 2016, Dr Chung (an independent psychiatrist, for the plaintiff) provided a report which outlined that the appellant was suffering from PTSD and that her symptoms would likely remain chronic and affect her future employment. Dr Chalk (an independent psychiatrist, for the defendant) provided four reports which went before the primary judge. In 2017 Dr Chalk noted an expectation of slow and continued improvement of the appellant’s condition. In 2019 Dr Chalk observed that the appellant’s condition had stabilised and reached maximum medical improvement. At such time Dr Chalk believed the appellant should have capacity to work up to twenty hours per week. In contrast, Dr Lotz (the appellant’s treating psychiatrist) believed psychological symptoms would continue to prevent the appellant from returning to employment. Even the optimistic opinion presented by Dr Chalk did not consider a full recovery by 2025 to be possible.  On this basis the Court of Appeal set aside the trial judge’s findings.

Appellant contends that their sociability is highly relevant to their employability  
Dr Chalk in his evidence-in-chief relied heavily upon the distinction between capacity to socialise and capacity to work, when concluding that the appellant should have capacity to work twenty hours per week. The appellant appeared capable and intelligent as a witness, which led the primary judge to rely upon the more optimistic views presented by Dr Chalk. The primary judge in his consideration did not say that evidence of the appellant’s social difficulties was irrelevant to employability, rather that it was difficult to draw a parallel between such evidence and employment. There was no error made in favouring Dr Chalk’s belief that there were some prospects of improvement and employability.

Appellant contends that an award of global sum was incorrect
Such argument was found to be irrelevant as the primary judge did not award a global sum.

Costs – Ecercise of Discretion

Appellant contends that indemnity costs be awarded
The appellant had recovered more than her mandatory final offer of $310,000 made in 2018 under the Motor Accident Insurance Act 1994 (Qld). The primary judge considered the mandatory final offer and the amount he awarded of $314,345 to be relatively equivalent.

Where the award for future economic loss increased to $307,000, the total award of damages increases from $314,345 to $543,988. The appellant must now be regarded as having obtained a result significantly more favourable than the amount of the offer which she made. Thus, the Court of Appeal found the appellant is entitled to recover her costs on the indemnity basis.

For further information, please do not hesitate to contact us.

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