Morris v D J Matheson Pty Ltd
[2004] QDC 448
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- Unreported Judgment
- Morris v D J Matheson Pty Ltd[2004] QDC 448
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Morris v D J Matheson Pty Ltd[2004] QDC 448
Morris v D J Matheson Pty Ltd[2004] QDC 448
DISTRICT COURT | BD2520 of 2003 |
CIVIL JURISDICTION
JUDGE McGILL SC
DAVID CHARLES MORRIS | Plaintiff |
and
DJ MATHESON PTY LTD | Defendant |
No BD2522 of 2003
DAVID CHARLES MORRIS | Plaintiff |
and
WARREN THATCHER | Defendant |
BRISBANE
..DATE 14/10/2004
JUDGMENT
HIS HONOUR: In relation to the question of interest on past economic loss, the figures in the judgment which I circulated in advance were based on an assessment of, in effect, the economic value of the plaintiff's earning capacity up to the date of judgment which had a substantial deduction from a figure calculated on the basis of the earnings as at the date of trial or the earning rate as at the date of trial projected from his actual earning rate prior to the time he ceased work.
That deduction was because of the prospects that there would have been some period of unemployment anyway in that period and the risk that, had these accidents not happened, something else would have stirred up the condition of his leg so as to prevent him from working to some greater or lesser extent during that period anyway.
In allowing interest, I deducted the amount received by the plaintiff for Workers Compensation payments but I did not make any deduction in respect of the amount the plaintiff had received by way of social security payments. Such a deduction should have been made, as is established by the decision of the Court of Appeal in Shield Contractors Proprietary Limited v. McGill [1997] QCA 359, and I accept that that was a matter that I overlooked at the time.
However, it has now been submitted, on behalf of the plaintiff, that although some deduction should be made, it should not be the full amount because I have not allowed past economic loss on the basis that but for the accident, the plaintiff would have been working for the whole period up to the date of judgment anyway. Rather, I have allowed for past economic loss on the basis that, in effect, there was a substantial period when he would not be working anyway, or the equivalent of a substantial period when he would not be working anyway.
It was submitted, therefore, that part of the unemployment benefits or other social security benefits which he in fact received would have been received anyway, and that I should only make a deduction in respect of the additional unemployment or social security benefits that had been received.
The approach to these issues which, it seems to me, did not really arise in Shield Contractors v. McGill, emerges I think from the reasoning in Batchelor v. Burke (1981) 148 CLR 448 as that decision was expounding in relation to interest in the judgment of the Court of Appeal of New South Wales in State of New South Wales v. Davies (1998) 43 NSWLR 182.
In the latter case, at page 194, the point was made that the plaintiff in the relevant period was entitled to receive both amounts, that is, both the amount he received by way of damages for past economic loss and the amount received under a particular statutory provision and that, therefore, the latter amount should not be deducted from the former for the purpose of calculating interest.
In a situation such as the present, if one could have said that, but for the accident, then the plaintiff would have been receiving some social security benefits anyway, then the situation in respect of those benefits is the same as the situation in respect of the particular payments considered in Davies; but for the accident, the plaintiff would have received both. That is, would have received the earnings which damages for past economic loss are intended to replace and those social security benefits.
That amount of the social security benefits, therefore, should not be deducted when determining the amount by way of interest. The question is how to derive that figure. I calculated a figure for the value of the plaintiff's working capacity up to the date of judgment and then applied a substantial discount, in the process of which a figure which started off at just over $125,000 ended up at a figure of $80,000. That was then apportioned; $20,000 to the first incident, the action against Matheson, and $60,000 in respect of the second incident, to the action against Thatcher.
It is agreed between the parties that any amount of deduction in respect of social security benefits should be applied in relation to the action against Thatcher so one disregards the $20,000 damages in respect of the Matheson action for the purpose of this exercise. On that basis, I was allowing, as damages for past economic loss against Thatcher, an amount which was a little under half the calculated value of the plaintiff's earning capacity, if I could put it this way, apart from any problems with his leg, assuming he was working fully during that period. But once that deduction is taken into account, so far as past economic loss against Thatcher was concerned, the plaintiff only received 47.85 per cent of that hypothetical past earning capacity.
Accordingly, counsel for the plaintiffs submitted that the amount to be deducted by way of social security benefits should only be 47.85 of the total benefits in fact received by the plaintiff during that period. The defendant has done a calculation which involves bringing those up to today's date on the assumption that the disability pension which started in July of 2002 continues at the same rate. That particular figure has not been contentious and it comes to a total of $51,029.
On the view that I have taken of the facts the plaintiff would have received some of that anyway - or at least I have calculated past economic loss on the basis that there was a substantial risk that the plaintiff would have been unable to work anyway because of the condition of his leg, under which circumstances he would have been receiving Social Security benefits anyway.
So I think it is appropriate not to deduct the full amount but rather only to deduct in effect the Social Security benefits that the plaintiff would not have received anyway on the basis upon which I have assessed past economic loss. Allowing 47.85% of that figure comes to $24,417.38 and if that, along with the figure of $1,302.37 for workers compensation payments, is deducted from the past economic loss of $60,000 the balance is $34,280.25.
In respect of past economic loss interest is required to be allowed at 10 per cent per annum but of course, because the loss is accruing over a period of time, one calculates that at half that rate for the relevant period. So I should allow interest in respect of past economic loss in the Thatcher action on $34,280.25 at 5 per cent per annum for 7.5 years. A figure of 7.7 years that I used in paragraph 102 seems also to have been a slip in the calculations. That produces a figure of $4,855-----
MR WEBB: And 9 cents.
HIS HONOUR: Yes.
HIS HONOUR: So that that means that the figure in paragraph C in the Thatcher action, instead of $22,600 should be $12,855.
MR MILES: I agree with that, your Honour. I agree with that calculation.
...
HIS HONOUR: I do not think the seven years period was a mistaken. I think it was derived by reference to the actual costs but 4 per cent is a mistake - it should have been 5 per cent. I had overlooked the statutory requirement in relation to that. So that becomes $603 for H.
...
HIS HONOUR: I think the net result of all that is the judgment comes down by $9,624 so that the Thatcher judgment becomes $160,064.94.
...
HIS HONOUR: In that case there will be judgment in the action against D J Matheson Proprietary Limited that the defendant pay the plaintiff $64,294, and judgment in the action against Warren Thatcher that the defendant pay the plaintiff $160,065. In each matter, as a result of the operation of the statute, there will be no order as to costs, and I formally publish the reasons that I circulated on the 1st of October 2004, which of course now need to be read with the additional reasons given this morning.
...
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