Brice v Brisbane City Council [1992] QSC 438

\. ~, I I State Reporting Bureau TRANSCRIPT OF PROCEEDINGS (Copyright in this transcript is vested in the Crown. Copies thereof must not be made or sold without the written authority of the Director, State Reporting Bureau.) SUPREME COURT OF QUEENSLAND CIVIL JURISDICTION LEE J No 860 of 1989 JOHN GREGORY BRICE Plaintiff and BRISBANE CITY COUNCIL Defendant BRISBANE . . DATE 21 I 1 2 I 9 2 .. JUDGMENT 1 ALl. rJ ____ ~-- T ---- r _____ .z.._ ,-. ______ r...._ ____ L T» -~-'- - ,...... ~"'''""' .._ .. -- 1 of 84 -- 211292 HIS HONOUR: For reasons which I am about to publish, I find ~~--\ ' ' \~. . ... 'I '-J~. ! ,/ ' I '-t that the defendant, the Brisbane City Council, was guilty of negligence and that the plaintiff was not guilty of contributory negligence. 10 -, ,. ' :. ~· .. On fhe plea of issue :1 have found.against the plain-tiff, ;y but this :makes ho because of my findings . :··· ,• on neglig~nce. · .. ',- I assess· the plaintiff~sdamages in the sum of $316,533. There 20 will be judgment for the plaintiff against the defendant in the sum of $316,533, together with costs of and incidental to the action to be taxed. Liberty to the parties to apply with respect to reserved costs. 30 I publish my reasons. 40 , .. ·,' 50 ...... 60 2 JUDGMENT -- 2 of 84 -- \ ... ! I \ ,~ ~·· ~. l . IN THE SUPREME COURT OF QUEENSLAND. No. 860 of 1989 Before the Honourable Mr. W.C. Lee BETWEEN: JOHN GREGORY BRICE (Plaintiff) AND: BRISBANE CITY COUNCIL (Defendant) REASONS FOR JUDGMENT - W.C. LEE J. Delivered the Twenty-first day of December 1992. CATCHWORDS Counsel: Solicitors: V.K. Copley QC with him M. Boulton for the Plaintiff. G.W. Crook Qc with him A.J. Williams for the Defendant. Hallets Solicitors for the Plaintiff. P.P. O'Brien Solicitors for the Defendant. Hearing dates: 5th to 16th October 1992. -- 3 of 84 -- ;. , _, ' ) IN THE SUPREME COURT OF QUEENSLAND BETWEEN: AND: No. 860 of 1989 JOHN GREGORY BRICE (Plaintiff) BRISBANE CITY COUNCIL (Defendant) REASONS FOR JUDGMENT - W.C. LEE J. Delivered the Twenty-first day of December 1992. Shortly after 9. 00 p.m. on 29th December 1986, the plaintiff was driving a near-new Ford Fairmont motor vehicle registered number 961-PTI at about 50 kilometres per hour inbound on the kerb-side lane of Milton Road, Toowong near the intersection of that road with Gregory Street on the left. He was the sole ~ occupant. Milton Road consisted of four lanes, two inbound and two outbound. A Brisbane City Council bus was also travelling inbound beside the plaintiff's vehicle in the centre inbound lane. The Ford Fairmont was owned by a company, Jeruk Pty. Ltd. , of which the plaintiff was a director. Jeruk Pty. Ltd. was trustee of the Brice-Chapman Family Trust and the plaintiff was a beneficiary of that Trust. He had the sole use of the motor vehicle full-time for both business and private purposes. For reasons which are in dispute, the vehicle got out of control and struck a power pole whereby the plaintiff suffered personal injuries. The plaintiff claims that his injuries, loss and -- 4 of 84 -- --------------, 2 damages were caused by the negligence of the defendant, and seeks damages accordingly. The writ was issued on 13th March 1989. The matter was set down for trial for five days but in fact took ten days in all. It was closely contested on all issues by the defendant with the exception of the plaintiff's special damages and the bulk of the plaintiff's future recurring costs. The main contest related to liability (and · contributory negligence) as well as to the plaintiff's past economic loss and loss of future earning capacity. In all there were some twenty-two witnesses called, some more than once, some 693 pages of transcript and 100 exhibits tendered. Extensive written submissions were handed up for each party. These were supplemented by very lengthy oral submissions. It was alleged by the plaintiff and admitted by the defendant that the defendant was the authority at all times responsible for the construction, maintenance and repair of a culvert and concrete headwall located in the inbound side of Milton Road, Toowong, at the western or outbound side of the intersection of that road with Gregory Street. This culvert and headwall is best illustrated by the model, ex. 46. It is located in the concrete channelling of Milton Road, so as to face a motorist proceeding inbound in the kerb-side lane. There was a dispute as to whether the headwall or the· asphalt surrounds protruded beyond the concrete channelling and encroached onto the bitumen surface of the lane. The: plaintiff's case is that the front left-hand wheel of his Ford Fairmont motor ·vehicle struck the said culvert and ( ( -- 5 of 84 -- '>I ,, 3 concrete headwall, causing the vehicle to lurch to the right, then to the left, and then with the front left-hand tyre deflated and the wheel damaged, to pursue a course towards the left-hand side of Milton Road beyond the eastern side of the intersection with Gregory Street where it mounted a kerb and struck a power pole. Particulars of negligence are set out in para. 5 of the Statement of Claim as follows: "(a) Constructing the culvert and the asphalt ramp surrounding the headwall so that it extended into the kerb-side lane of Milton Road creating a danger and a formidable obstacle to the plaintiff and other persons traversing the kerb-side lane of Milton Road; (b) said when lane Allowing, permitting or failing to remove the obstacle from the kerb-side lane of Milton Road it knew or ought to have known that the kerb-side was not of significant width; (c) Failing to construct proper and safe underground drainage so as to eliminate the need and existence of a headwall; (d) Failing to construct the said kerb-side lane tothe Council standard of 3.5 metres, when it knew or. ought to have known that the said construction was inadequate for the safe avoidance of the said culvert; (e) Constructing a hazard at a time whe~ it knew or ought to have known that Milton Road was an arterial road carrying a heavy flow of traffic, and that such construction was contrary to proper road building practice; (f) Failing to provide any .or any adequate lightingor warning of the existence of the said culvert; (g) Failing to remove the culvert ·when they knew or ought to have known that it was a dangerous obstacle which could or would impede the safe passage of traffic along Milton Road in the kerb-side lane." Paragraph (d) was not relied upon at the trial as a particular of negligence, but was used to demonstrate the narrow width of the lane of approximately 3 metres only, on what was a major arterial road to and .from the city linking up with the -- 6 of 84 -- ·~ '<' 4 Western Freeway, thus ·making it foreseeable that a car, travelling inbound, might, with the exigencies of other traffic in the centre~lane .to its right, easily edge or drift to a point closer to the channelling and thereby strike the concrete headwallor at least the asphalt surrounds of it. The defendant denied the allegations in para. 5 of the Statement of Claim and contended that there was no evidence that the plaintiff's motor vehicle struck the headwall at all. The defendant also pleaded that if the defendant. is found guilty of negligence, the plaintiff is guilty of contributory negligence, particulars whereof are set out in para. 4 of the amended defence as follows: •.• (a) Failing to keep any or any proper lookout; (b) Driving the said vehicle into the culvert when it was unsafe to do so when a reasonably prudent person would not have done so; (c) Driving the said vehicle to the extreme left-hand edge of the carriageway when it was unsafe to do so when a reasonably prudent person would not have done so; (d) Driving the said vehicle in the gutter to the left of the carriageway when it. was unsafe to do so and when a reasonably prudent person would not have .done so." The plaintiff by para. 6 of the Statement of Claim also raised issue estoppel against the Brisbane City Council by reason of an action brought on 5th November 1987 by Jeruk Pty. Ltd., the registered owner pf the Ford Fairmont motor vehicle, against the Brisbane City Council for damages sustained to that motor vehicle out of the same incident .. In that action the defendant denied liability for that damage and also pleaded contributory neg~igence l:;>y Jeruk Pty .. Ltd. The pleadings and judgment therein are ex. 60. The plaintiff, Jeruk Pty. Ltd., joined issue on the '~ ~ J I "' -- 7 of 84 -- b' 5 defence. That action was tried on 8th February 1989 before His Honour Judge Bolton in the District Court. On 22nd February 1989 His Honour delivered judgment and found that the Brisbane City Council was negligent and liable for the damage to the motor vehicle and that Jeruk Pty. Ltd. was not liable for contributory negligence. The defendant has contended that issue estoppel cannot arise because the parties and the damages are not the same. The plaintiff said in evidence that on · the evening in question, he intended visiting his brother. It was a social visit. He drove along the Western Freeway and then on to Milton "---- Road in the kerb-side lane. He was travelling at about 50 K.P.H. He was aware of a large vehicle to his right-hand side, and-_ very close to him. He said that he was paying attention to it because it was very large and intimidating. He did not feelany danger then "all of a sudden there was a large impact which felt like the front left-hand wheel had been ripped off". His recollection after this was hazy. It appears that he was -rendered unconscious for a short time following the impact of his vehicle with a power pole. He said it was "wrapped around a telegraph pole".and·that it had "collided dead-centre with the telegraph pole". S'ee ex. 42, a photograph showing the damage to the front of the motor vehicle. He said that he was not aware of the presence of· a headwall and that there was no warriing sign on the approach to. Gregory Street to warn a motorist of its presen:ce. · After seven weeks in hospital, and on the·way home, he visited the scene and then saw an extensive body of roadworks being conducted·at the· -- 8 of 84 -- 6 very spot in question. This clearly emerges from the photographs tendered.in the case . . William Keith Brosnan, air traffic controller, lived at Fig Tree Pocket for nine years. He had proceeded along the Western Freeway and onto Milton Road on his way to work at about 9.00.p.m. on 29th December 1986. He was also travelling in the kerb~side lane. He had traversed Milton Road many times previously. He became aware of the Ford Fairmont sedan in the lane immediately ahead of him travelling close to the kerb but not in the kerb. It was about three or four car lengths in front of him .. H_e was. also travelling at about 50 kilometres per hour, the same speed as the Fairmont. He saw a Brisbane City Council bus travelling in the centre lane inbound, and beside the Fairmont. The Fairmont' s lights were operating. The weather was fine and clear. Mr. Brosnan observed nothing untoward in the manner of travel of the Fairmont. He agreed that ex. 46 was a fair representation of the area except that the "hump" in Gregory Street as it joined Milton Road was a little more pronounced than illust+ated in the exhibit.. He was aware of the existence of what appeared to .be a· concrete collar and pipe exit (Le. the. . headwall) on the northern side of Milton Road. As the Fairmont was ~mmediately adjacent to the collar of the pipe, the Fairmont "rolled or lurched to the. right quite suddenly, then moved equally suddenly back .. to the left and impacted with the light pole". The Fairmont pursued a course on-an angle before it mounted the kerb and struc::k the light_pole. Mr. Brosnan and the driver of the Brisbane City Council bus· attended the plaintiff who was unconscious. He regained consciousness shortly '' -- 9 of 84 -- ·'-...-· .,. 7 thereafter and appeared to be in a fair degree of pain. Mr. Brosnan waited for the police and gave his version to Senior Constable Campbell who arrived at the scene at about 9.29 p.m. Mr. Brosnan, who had travelled the area regularly, said that by reason of the hump in Gregory Street as it joined Milton Road and encroached to some extent onto the inbound lane, a·vehicle travelling on the inbound lane rolled to the right duringnormal travel. However, he said that the sudden movement ofthe Ford Fairmont motor-vehicle to its right was "much more violent than the normal roll to the right something happened to make it roll far more suddenly ·- than I would have expected_, frighteningly". Senior Constable D.A. Campbell on arrival· saw· the damaged Fairmont motor vehicle against the pole. The front left wheel·· was damaged and appeared to be on an angle. · · Part· of~ the suspension was pushed underneath. He agreed that ex~ 46 wri~ generally a fair representation of the area although he recalled .. . that the pole which the Fairmont struck was nearer to Gregory Street than the pole shown in ex. 46. He described a metal "no parking" sign post in Gregory Street on the eastern side of its junction with Milton Road. It had been knocked out of the ground recently. He identified the headwall on the model, ex. 46, and on the night in question he observed very· recent scuff marks from the headwall across the intersection of Gregory Street "as if a wheel was sideways scuffing across". The marks were in line with the steel post which had been freshly knocked out of the ground. It appears from ex. 46 and Senior Constable Campb~ll's -- 10 of 84 -- 8 indications of marks thereon in-court,. that they were generally in ·line with the path taken _by _the Fairmont to where it ultimately came to_rest against the power pole. He saw no marks on the headwall itself. The ~cuff marks commenced "more or less straight away" after the headwall and-in close proximity to it, alth6ugh he did not measure the actual distance. He said in cross-examination that . the marks commenced . from behind the headwall. A copy of his traffic accident report, ex. 66, was received in evidence. I do not ma~e use of the sketch thereon other than to show-the path of the scuff marks referred to-in evidence and how they proceeded in tl)e direction of the Fairmont at rest against the_pole. Senior Constable Campbell, who is attached to mobile patrols, and who had· patrolled that area on numerous occasions between-August 1986 (when the headwall was built) and 29th _December 1986, had not noticed the headwall prior to the subject accident. He then noticed that it was a hazard. As a result of this incident, he prepared a hazard report for the Department of-Main Roads. This was tendered without objection as ex~ 67~ He said in this report: ·"The water drain at the bottom side (western side) of the intersection is too high and vehicles clipping this would.-all lose control. The road is in two ( 2) lanes each way but narrows because of this high drain and could cause more accidents." This evidence is not relied upon to show that the headwall caused the accident, but only to indicate the police officer's opinion that .the headwall.constituted a traffic hazard. Senior Constable Campbell agreed in-cross-examination that the headwall was encompassed in the area of the gutter. ',, -- 11 of 84 -- ' ; 9 A short time after-the hazard report was lodged, Senior Constable Campbell noticed roadworks being carried out in the vicinity of the headwall. This headwall and the drain section had been changed. The evidence of various witnesses including the plaintiff, John Stapleton traffic engineer, Kieran John McWha a Brisbane City Council ganger, Senior Constable Campbell, and Mr. J.D. Randall Brisbane City Council Works Supervisor, as well as the photographs tendered in evidence, show that the headwall ~- and drain as it emerged from under Gregory Street as well as the surrounding asphalt was done awciy with soon after the accident and instead, a drain and manhole was inserted beneath the roadway "---/ so that the channelling along the kerb of Milton Road was then continuous, without the obstruction as existed previously. The plaintiffts wife, Mrs. Kerry Ann Brice, arrived at ·the scene. Her husband by this time had been removed from the Fairmont. She was taken by the police officer to-· the headwcHl. ~- She saw what she described as a square protuberance of the gutter-- almost onto the road with a huge pipe coming through. She observed a long drop from the top of the headwall to the floor of the channelling. The drop came to the height of her knees. She did not notice any marks on the concrete as it was dark, even though there was some street lighting. She was more concerned about her husband's condition. John Stapleton, traffic engineer, lived at Jindalee for eight years and travelled Milton Road almost daily in the area in question. He described Milton Road as one of 'the primary roads into the city, providing a link between the western suburbs and the central business district. It carried about 20,000 -- 12 of 84 -- 7 10 vehicles per day, two ways. He measured by pacing the width of the .kerb-side lane to be about 3 metres. He said a primary road would normally. have a width between kerbs of 14 metres, producing traffic lanes o.f about 3. 5 metres in width. He was aware of the pip~ culvert which was.there in 1986 and agreed that ex. 46 was a fair representation of the area . . On the basis that the headwall was built in. August 1986, he said that good engineering practice would have dictated that the drainage from this area should have been underground and that a gully pit should have been. provided in the kerb to take storm water, .as was in .fact installed by the defendant soon after the accident. He said that the pipe and headwall as constructed was not good engineering practice at that time. He was of the view that the headwall presented a hazard if a driver was travelling in the far left of the lane because of the vertical face of the headwall and its solid concrete nature. He said that the headwall protruded beyond the gutter width and onto the bitumen surface. He agreed.that the sketch, ex. 51, was consistent with his recollection. and re-affirmed that the headwall protruded beyond the edge of the channel. He was certain that the grading of. the side street . ( Gregory Street) extended. out beyond the headwall. He said that had the later works been performed in August 1986, instead of the concrete headwall, the estimated cost thereof wi_th two gully pits would have been .. in the order of $8,000. With only one gully pit as constructed, the cost would have been in_the order of $7,000. In cross-examination he repeated his belief that the ' headw~ll extended beyond the channel edge. He always avoided 'rj -- 13 of 84 -- ', 11 travelling in the-kerb-side lane because he was aware of the headwall and pipe at the · intersection as well as the very substantial vertical alignment in that lane. The grading of Gregory Street into Milton Road also caused a sharp rise at the intersection. He said that even if the headwall did not prot·rude beyond the line of the gutter, ·it needed changing and rectification because he was not aware of any similar obsta·cles in Milton Road with its heavy trafficr volumes. Kieran John McWha was for three years employed by the Brisbane City Council as a ganger. He was so employed in 1986. He was engaged in restoration to· kerbing and channelling and associated works. He said that ex. 46 was an almost perfect representation of the site. He said that in August·1986,· there was no headwall present. There was a pipe across the face of Gregory Street under the surface of Gregory Stree·t. It was blocked. The pipe was crushed about 1.2 metres fro'm its end and was not working, with water flowing over the· top and no doubt· onto the roadway. In August 1986 he created the headwall, "constructed by the BCC overseers". There was no input from engineering staff. He said that the headwall was designea by Jim·Randall, overseer, who left it to him, providing it had six inches coverage of concrete. He was told to do it simila~ to "the registered box we used to use". However, he could not fit a registered box because of the depth of concrete. He· installed about one metre of new pipe and built the headwall to house it. . . ' He was definite that no headwall was in existence before and that there was no concrete around the pipe whatsoever. I so find. -- 14 of 84 -- 12 . Mr. McWha said that. he had difficulty blending the asphalt with the headwall because he had three angles to work with. He said he did the best he could. to ·try to make it as safe as possible, but he said "I still thought it was wrong - it was too high". He referred to the large lump or mound of asphalt adjoining t.he headwall. He reported this situation to his supe:r:iors. He said that the dimensions shown in the.plan, ex. 51, of the.headwall wer~ correct but that it did not measure the asphalt taper or lump of asphalt correctly. He described this asphalt as hard as concrete. There was a bigger lump than as indicated on the sketch. He said that the concrete of the headwall did not protru9e beyond· the gutter into the kerb~side bitumen lane but that .the asphalt _did ·t:o a fair extent. He said that if the asphalt was struqk at a wrong angle, "you would have the same fore~ as hitting concrete" . . Mr .. McWha said that the concrete headwall was about 450-500 millimetres high with a taper on the edge nearest ·the bitumen 9f the kerb-side lane, with a height of about 350 millimetres on the edge nearest the bitumen. He also said that the bitumen o~ asphalt on the right of the headwall which went. out into the lane. was also about 350 millimetres high. Mr. McWha also said that a delineation post was put in after the accident. It was. placed in the channel about four feet before the headwall. It was white with a red reflector and installed to warn mot~rists of the presence of the headwall. It was.apparently removed when the.headwall was later removed and '( '' -- 15 of 84 -- \ ,. ' 13 the drainage placed underground by means ·· of the manhole and gully, as the photographs indicate. The only other witness to visit the area was J.D. Randall, the Brisbane City Council Works Supervisor. He was an overseer in 1986. He went to the scene the day after the accident and saw no marks on the headwall itself. He did notice marks on the bitumen surface about a metre from the face of the headwall towards the city, on an angle going towards Gregory Street. He ~ indicated this on ex. 46. He said that the marks or scratches commenced on top of the drain line indicated by white marks on ex. 46 and they also commenced on the Milton Road side .of the ~· drain. He could not remember the length of the marks. Nor could· he recall whether they were fresh. It was submitted .on behalf of the defendants that this evidence conflicted with the marks described in evidence by Senior Constable Campbell. Mr. Randall also said that the headwall extended to the ~ alignment of the channel and that the headwall was about 490 millimetres high ( 20 inches) which would accord with the measurements of the internal dimensions of the ·pipe ( 300 millimetres), plus the pipe wall thickness ( 40 millimetres), plus 6 inches of concrete ( 150 millimetres). In cross-examination, he said that the height of the headwall was 470 millimetres, on the basis that the plan, ex. 5·1, was drawn to scale and according to a scale ruler handed to him. He also said that there was 150 millimetres ( 6 inches) ,of concrete against the pipe on the kerb-side·, but only 11 0 millimetres ( 4-! inches) against the pipe oh the bitumen side- of the pipe. If this was so, the headwall would not have -- 16 of 84 -- 14 extended beyond the channel, if the channel was 450 millimetres wide as indicated in ex. 51. This would be achieved by adding the internal dimensions of the pipe (300 millimetres), the width of . the pipe wall ( 40 millimetres), and the thickness of the outside wall of concrete (110 millimetres). It must.be recalled however that Mr. Stapleton said that channelling varied between 300 millimetres and 450 millimetres wide. Also, i.f ex. 51 was a· scale model, it shows the same thickness of concrete.on the bitumen side of the pipe as on the kerb-side which Mr. ·Randall said·was 6 inches (150 millimetres). Mr. McWha.did the actual construction of the headwall and said 6 inches of concrete was necessary. He said that Mr. Randall left the job to him. I find that the headwall was approximately two feet wide ( 600· millimetres). and approximately 20 inches high (490:millimetres). The corner nearest the bitumen was bevelled down by Mr. McWha. His evidence puts this bevel as deeper than as described by Mr .. Randall who appeared to be somewhat uncertain on matters of detail. I find also that there was a large lump of: asphalt on the r_ight-hand side of the headwall on the bitumen side:, joining on to it, and protruding out into the bitumen carriageway. It was at least 350 millimetres high and above the bitumen road surface. If there was six inches-of concrete on the bitumen side of the pipe as the scale plan indica_tes, and as appears likely from . Mr. McWha's evidence, this would mean that the headwall itself extended approximately 40 millimetres beyond the edge of the channel . on to the bitumen carriageway. This accords with '.. -- 17 of 84 -- ... \ 15 Mr. Stapleton 1 s recollection of it. I find that this was probably the case, although even if this conclusion is wrong, I am of the view that it does not matter because of.- Mr. McWha 1 s evidence which I accept on this aspect that there was the large lump or bump of asphalt surrounding the headwall which protruded onto the bitumen and was part of the headwall structure. This in itself constituted a dangerous hazard to motorists travelling on the narrow kerb-side lane, particularly at night. The· only other witness to throw light on the probable cause of the accident was Keith Richard Spanswick, a consulting materials scientist. He had received the actual wheel of the Fairmont in June 1987 for· examination and took photographs~ exs. 43 to 45. The tyre was deflated and he saw no damage to the tyre attributed to operation in an underinflated or deflated state. The effect of his evidence is that the tyre was fractured and the rim damaged by an initial severe impact, with the .. second -~ fracture to the tyre and damage to the· rim being caused by a· subsequent impact with a different object. He said that with the first impact, the tyre was fractured and deflated·. The vehicle would therefore tend to be dragged to~ards the left side, thus directing it towards the kerb on the other side of the T-junction. Thus, he said that the first damage; point ":X" on ex. 43, was consistent with striking the headwall, with the vehicle then proceeding towards the opposite kerb, with which the wheel impacted thus causing the second damage· marked "Y" on ex. 43. Much was made of the fact that Mr. Spanswick did n.ot say that the vehicle, if it struck the headwall, would first have -- 18 of 84 -- 16. lurched sharply to the right and then equally sharply back to the left. On the other hand, he did not say that it would not act • . f • in this way. His evidence, that the damaged and deflated front left-hand wheel and tyre would cause the vehicle to move to the left, is in my view consistent with the vehicle first having moved sha~ply to the right and then to the left. Much was also made of the.fact that the plaintiff, on his admission to hospital, appax;-ently told medical staff that the accident occurred when he swerved trying to avoid a dog and had then run his car into a telegraph pole. See ex. 1. However in cross-examination the plaintiff could not remember having said this to a doctor. Also, w~ilst in hospital, he signed a claim form l,odged with the insurance company who insured the Ford Fairmont s~dan. It is dated 8th January 1987 (ex. 61). In the description of the accident, which was written by his wife while he w~s in hospital, the following appears: 11 T~rned into Milton Rd from Round-about. Dog appeared from right. Swerved left to avoid Clipped concrete drain and above ground drain lost control and then hit telegraph post" In cross-examination, the plaintiff stated that he said this because he needed justification for what he was doing in hospital. He admitted that he lied and was adamant that no dog was involved. Mr. Brosnan saw no dog and no other witness who was in a position to observe a dog if it appeared from the right (viz. the Brisbane City Council bus driver) was called to give evidence. ·Clearly no dog was involved. The plaintiff said that he was in severe pai~·~nd heavily sedated from the time he got into hospital and subsequently. There is also some evidence that he suffered a short period of pre- and" post~amnesia. r l -- 19 of 84 -- '. .. 17 It was submitted for the defendant that because of the statement about the dog, the plaintiff had no concept in his mind that he had come into contact with some dangerous hidden object through no fault of his own. However, the plaintiff was adamant in evidence and particularly in cross-examination that he had hit something at the intersection, but did not know of the concrete headwall until he was later told about it. He.did not knowwhat he had hit and so made up the story about the dog. Whilst the fact that the plaintiff was prepared to fabricate a version to the insurance company reflects to some extent on his general credit, I am of the opinion that in the light of all of the other evidence in the case, including independent evidence, this aspect has little significance on the question of liability. In addition, and for what it is ·worth, the claim form ex. · 61 stated that he "Clipped concrete drain and above ground drain", .. which is consistent with the plaintiff having a concept·in his ~ mind that he had struck some dangerous hidden object, contrary ~ to the submission on behalf of the defendants. An examination of all of the evidence leads to the ~· conclusion that the plaintiff's vehicle struck either the outside edge of the headwall or at least the large lump of asphalt associated with it. It lurched first to the right, then to the left as Mr. Brosnan said. Its front left-hand wheel and tyre were then damaged, resulting in the deflation of the tyre, thus causing the vehicle to proceed on a slight angle across the mouth of Gregory Street where it struck and mounted the kerb on the opposite side of Gregory Street when the second damage to the wheel occurred. It then proceeded to collide with the power pole -- 20 of 84 -- 'o 18 a short distance further ·ahead. The existence of the scuff marks referred to by Senior Constable Campbell are entirely consistent with this:conclusion. The evidence of·Mr. Randall as to the marks he saw was. imprecise. He could not say how old they were or-their length. In any event, from his indications on the model ex-. 46, ··I am of the. opinion that the marks he saw were not inconsistent with some of the marks observed by Senior Constable Campbell on the night of-the accident .. · The plaintiff said that he was travelling in the lane., close to the channelling and not in the channelling itself. Mr. Brosnan confirmed .this. Mr. Brosnan did not see the actual impact. ·Even if the headwall and adjoining asphalt did not protrude onto the bitumen carriageway, I am of the opinion that the. si tu.ation still constituted a hazard to motorists in the kerb-side lane. and particularly at night time. Motorists were unde:r ·a duty to consider the exigencies of other traffic, as indeed.the plaintiff was obliged to do with the large Brisbane City· Council bus travelling very close to.him on his right and in a threatening manner. It was in my view foreseeable that such a motorist. would b_e likely in such circumstances to travel as close as possible to the channelling and may even edge or veer into. it. The .risk that this might occur on a busy narrow lane with~ther traffic at night, was not far fetched or fanciful: Wyong·Shire Council v. Shirt (1980) 146 C.L.R• 40 at 48. No reliance was placed by counsel for the defendant on the concept of non-feasance of·a road authority. It was not pleaded and was-expressly disavowed.during the case. In any event, the authorities show that such a defence had it been raised, would -- 21 of 84 -- '( 19 not have been open on the facts of this case as found. See the authorities cited in O'Ryan v. Commissioner of Main Roads and Waggamba Shire· Council -(No. 1644 of 1983, - 1st . April 1992, unreported), and by the Court of Appeal (Appeal 67 of 1992, 19th November 1992). It was however conceded on .behalf of the defendant that the defendant had a duty of care ·in the construction of the headwall but it was submitted ~that the defendant had satisfied that duty. Reference was made to Sutherland Shire Council v. Heyman (1985) 157 C.L.R. 424 at 445 per Gibbs C.J. The defendant was clearly under a duty ·not to create a danger on :the road which it did in this case. It failed to provide any warning of the presence of the concrete headwall and asphalt protrusion, as it did after the accident by the installation of the white delineator post with the red reflector. It failed to take the steps which it subsequently took of ·the removal of the headwall entirely and· a reconstruction of the drainage by underground gully and pipes. Either of these steps demonstrate practical precautions which could have been taken to ~- prevent an accident: see Oulton v. Brisbane stevedoring and Wood Dumping Co. Pty. Ltd. [1958] Q.W.N. 35. The risk of an accident could have been eliminated by- the incurring of modest expenditure in removing the headwall and placing it underground, as indicated by Mr. Stapleton, or-alternatively by minimal expenditure by_the installation of a suitable delineator warning post with reflectorised sign as referred to by Mr. McWha. In my opinion, the defendant was clearly in breach of its duty of care in the -- 22 of 84 -- / 20. circumstances of· this case, and was negligent in constructing the headwall and asphalt surrounds in the manner in which it did. The question then arises as to whether the plaintiff was guilty of contributory negligence. Given that I have concluded that-the defendant had failed to discharge its obligations to take reasonable care, the circumstances and ·condition of the roadway and the hazard created by the defendant must be taken into account; Podrebersek v. The Australian Iron and Steel Pty. Ltd.' (1985) 59 A.L~J.R. 492 at 493 column 1f, the question being whether under the prevailing conditions the plaintiff's conduct amounted to mere inadvertence, inattention or misjudgment, or to negligence. The question of apportionment is a question of fact. The making of an apportionment involves a consideration of the degree of departure·from the standard of care of the reasonable man ·and the relative importance of the acts of the parties in causing the damage. It,is necessary to take into account the plaintiff's duty to other road users: He had to take into account other traffic on the road at the time and in particular the presence of the B~isbane City Council bus travelling very close to him in an intimidating manner on"his immedi-ate right. The headwall was not noticeable to a motorist travelling on that road particularly at night~ The lighting· was poor. Senior Constable Campbell with his experience as ·a member of Brisbane Mobile Patrols, had driven the road many times and had not noticed the headwall previously. There ··was no· warning sign of a hazard constituted by the headwa:ll. · · The plaintiff's conduct did not constitute a deliberate running of any risk for his own safety. The defendant -- 23 of 84 -- 21 created the hazard or danger and failed to warn the plaintiff of its existence. What the plaintiff did in the circumstances was no more than what a motorist might reasonably do if he moved a little too far to his left when travelling abreast of a large vehicle on a road with narrow lanes. In my -opinion, the plaintiff is not guilty of contributory negligence. ISSUE ESTOPPEL Submissions were made in relation to this matter at the start of the trial. They appear in the transcript. The evidence of the District Court proceedings was allowed (ex. 60) so that it is on the record. Further submissions were made during addresses. In view of my findings on the evidence as to negligence and contributory negligence, it is not strictly necessa~y . for a conclusion to be reached on this point. However as it was argued, some reference to it is desirable. It is clear from the authorities that for an estoppel to arise, the first requirement is that the parties in each action must be the same in their same respective interests .· or -....__. capacities, or at least the parties in the subsequent action must be privies of the parties in the earlier action in their same respective interests and capacities. Or, if one·of the parties is identical in each·action (as in this case viz. the Brisbane City Council as defendant in each case), the other party in the later action must be a privy of the other party in the earlier action in the same interest or capacity.· It is the latter category here relied upon by senior counsel for the plaintiff •. -- 24 of 84 -- 22 : If the first requirement is not satisfied, a plea of estoppel fails at the:outset:. Ramsay v. Pigram (1967) 118 C.L.R 271 per Windeyer J.·at 289. If· that requirement is satisfied, it is also necessary to determine whether the central issue in the later action is identical with any issue raised and determined in the earlier action: ibid. If is not, the plea also fails on that ground . . . A third requirement is that before estoppel can operate, the estoppel must be mutual in that no one can take advantage of an earlier judgment unless he would have been concluded by that judgment had it-gone the other way. Had it been held that the Brisbane City Council was not in breach of a duty of car~ to Jeruk Pty. Ltd. in the action for property damage to the Ford Fairmont motor vehicle or that Jeruk Pty. Ltd. was guilty of contributory negligence: see per McTiernan J. in Ramsay v. Pigram (supra).at 282 and the submissions·by W.P. Deane.Q.C. (as he then was) at 273-4, would the plaintiff in the present action have been precluded from suing the Brisbane City Council for damages for personal injuries flowing from a .breach of duty of care to him or from denying that he was guilty of contributory negligence? Would the· fact that Boulton D.C.J. negatived cont-ributory n~gligence against Jeruk Pty. Ltd. necessarily exonerate. the plaintiff from any finding of contributory negligence against him in the current action? . Senior counsel for the plaintiff contended that the plaintiff was privy td Jeruk Pty. Ltd. in the same interest or capacity. It was said that this flowed fron the fact that the plaintiff was a director and shareholder of Jeruk Pty. Ltd., "its ( -- 25 of 84 -- 23 guiding mind-and will, the very ego and centre of the personality of the corporation": Lennards Carrying Company Ltd. v. Asiatic Petroleum Company Ltd. [1915] A.C. 705 at 713. Further, the plaintiff was "the embodiment of the company ... his mind is the mind of , the company" : Tesco. Supermarkets Limited v. Na t tras [1972] A.C. 153 at 170, 171, 187, 200; H.L. Bolton (Engineering) Co. Ltd. v. T.J. Graham and Sons Ltd. [1957] l Q.B. 159 at 172; Kehoe v. Dacal Motors Pty. Ltd. [1972] Qd.R. 59 per Andrews J. at 73-74, per Wanstall A.C.J. at 61. It was further submitted as follows: that the plaintiff was the bailee of the vehicle and was entitled to.sue in his own right for damages to the motor vehicle so that, had the plaintiff adopted this course, a determination for or against him in such capacity in the earlier action for property damages would .have been determinative of the issues of negligence and contributory negligence in the present action for damages for personal injuries; that the issues in each case were the same viz. negligence and/or contributory negligence; that the cause of action need not be the same and it is not necessary that the damages be the same: Bollen v. Hickson [1981] Qd.R -249 per D.M. Campbell J. at 253B; that different particulars in each action do not constitute different issues; that Finn v. Lemmer (1991) 55 S.A.S.R. 455, 460.5 is contrary to authority and ought not to be followed; that the defendant's .duty to road user~ is the same viz. to take reasonable care to prevent injury, whether bodily injury or property damage by failing to exercise reasonable care; and that there was no suggestion. that the -- 26 of 84 -- 24 - defendant refrained from calling .evidence in the District Court action: Bollen v. Hickson (supra). Senior counsel for. the defendant relied upon Jackson V. Goldsmith (_1950) 81 C.L.EL 446 at 456.2, 4_61.3, 462.2, 463.1-463.5,. 463.8; Ramsay v. Pigram (supra) at 276.2; Spencer Bower & Turner-- Res Judicata 2nd Ed. p. 274, para. 208. He submitted that the claim failed at the threshold because there must be an identity of parties to create identity of issues; that the High ~ourt requires that there be strict compliance with the technica~.requirements of issue estoppel for it to be validly foundedt that there was no pr~vity between the plaintiff and Jeruk Pty. ~- Ltd.; that the· plaintiff as a director is not a servant ot the company and that as he was on a social visit to his brother and. not on company business, there was not even agency; th~t there could not have been a finding of contributory negligence against the. plaintiff in the District Court action as . . . he was riot a party; that there cannot be an identity of issues as to the claim by. ~eruk Pty. Ltd. for damages to its vehicle and the cla~m .. ~Y a person who is driving_ that vehicle for personal injuries to himself. He relied on Finn v. Lemmer (supra) where the :_orthodox ~iew of the High Court was firmly adopted. He .also submitted that the first instance decision of Popplewell J. in Wally. Radford [1991] 2 All E.R. 741, where His Honour declined to,follow Jackson v .. Goldsmith, is not the law in Australia. I have difficulty in concluding that the plaintiff was a privy in the relevant ~ense to Jeruk Pty. Ltd. It was submitted by peane Q.C. (as he.then was) in Ramsay v. Pigram at 273-4 as follows: "' -- 27 of 84 -- 25 "On the meaning of 1 privy 1 in relation to issue estoppel we adopt the statement in Everest and Strode on The Law of Estoppel, 3rd Ed. (1923), p. 55. As regards estoppel, the same doctrine applies to each category, namely that one who claims through another is, to the extent of his claim, subject to and able to take advantage of all estoppels affecting the person through whom he claims. The essential nature of a privy for the purpose of estoppel is not one subjected to a vicarious liability because of something; it is one who claims a title or right or makes a claim by virtue of a title or right in someone before him." See also per Barwick C.J. at 279: "Of the three classes of privies of blood, of title and of interest, the only one which is submitted and indeed could be submitted to be relevant is that of a privity·in interest. But I am unable to conclude that the Government or the police department was in this sense a privy of the police officer. The basic requirement of a privy in interest is that the privy must claim under or through the person of whom he·is said to be a privy. Here it is quite clear that the Government had no interest in the action between the respondent and the police officer: nor can it be said that the action brought by the police officer ·was - brought by him in any sense on behalf the Government or that in relation to the defence of contributory negligence the respondent could have been treating the Government as the real 1 defendant 1 · to that c·laim. In every respect the action between the respondent and the police officer was personal to each of them, neither being in any sense in relation to the other or any of the issues involved in it, representative of another. Nor can it be said that the Government in any sense claims under or in virtue of · the police - officer or of any right of his, or that it derives any relevant interest through him." See also the remarks of Diplock L.J. in Mills v. Cooper [1967] 2 Q.B. 459 at 468-9, quoted by D.M. Campbell J. in Bollen v. Hickson (supra) at 253 where His· Lordship referred to a previous civil proceedings between the same parties Or their predecessors in title. I therefore conclude that the plea-of estoppel fails at the threshold, because the plaintiff is not privy of Jeruk Pty. Ltd. in the relevant sense. This is sufficient to conclude the · -- 28 of 84 -- ~-- 1 ..' 26. question.~- However,· I am. of the opinion that the submissions of senior counsel.for the .defendant. that the-central issues are not the same and ·that there is no relevant mutuality is probably correct in the circumstances of this case and provide additional reasons why the plea of estoppel .fails. I accept that I am bound by the decision in Jackson v. Goldsmith: see per Kneipp J. (dissenting) in Bollen ·v. Hickson (supra)·at 257, 258. This leaves the question of the plaintiff's damages. It was not disputed that the plaintiff suffered a severe injury to his knee, resulting in a permanent disability and that he .endured considerable pain and discomfort as a result. In 1987, Dr. J. Tuffley, Orthopaedic Surgeon, said that there was an impairment of 25 per cent of the left lower extremity, but with pain this figure would be between 30 to 35 per cent (ex. 1). impairment.. On 4th January 1991, Dr. Tuffley said that the impairment was in the order of 40 per cent but with pain the disability was in the order of 50 per cent (ex. 2) . He also said that there was a permanent disability of about 1 per cent to the lower thoracic spine which had become symptomatic since the accident due to leg length discrepancy. The left leg is 3.75 to 4 centimetres shorter than the right. On 21st July 1992, Dr .. Tuffley said that the permanent loss of function in the left lower extremity· was . 36 per cent but with a knee arthrodesis, there.would be a partial permanent impairment in the order of 60 per cent. On 11 th November - 1 9 91 , Dr. Toft, Orthopaedic Surgeon, assessed the permanent disability of-approximately 30 per cent of· the left lower . limb, but with degenerative· changes and -- 29 of 84 -- 27 increasing osteoarthri tis, the disability would increase to 50 per cent in about 10 or 15 years time. At that time, Dr. Toft said that the plaintiff would require an operation either to stiffen the knee or to insert an artificial knee. He said that the plaintiff suffered a 5 per cent permanent partial disability in the spine as a whole due to the fact that his constitutional condition in his back which pre-dated the accident, had been made symptomatic by his leg length discrepancy and change in weight bearing pattern associated with the deformity in his knee. He said that with a knee replacement, permanent disability to the left leg after a settling-in period of·6 to 12 months would be between 15 per cent to 20 per cent only. Dr. J,H. Morris, called for the defendant, said that on 26th February 1992, the permanent disability of the left leg was approximately 35 per cent but this would increase in time. He was also of the view that the plaintiff would either need an arthrodesis or a knee replacement. He said that with an arthrodesis, the permanent disability would be 50 per cent (ex. 84), but with a knee replacement, the permanent disability would be about 25 per cent. He also said that pain in the thoracic spine was relatively minor and related to aggravation of degenerative changes in the spine due to abnormal gait, resulting in a disability of the spine of about 2 per cent.· There was some dispute about whether and· what surgery to .his knee should be undertaken in the future, about the degree of pain and discomfort actually suffered by the plaintiff, and whether he has suffered any psychiatric illness as a result of· the accident. A major contest occurred as to the.plaintiff's past -- 30 of 84 -- / 28 economic loss and loss of .. future. earning capacity, tied up as those issues were with. the effect of his knee injury and his alleged mental condition. It.was the defendant's case that the plaintiff either lied, or at best exaggerated, in his attempt to show that he is now able .to work only 20 hours per week and that he has focused his attention upon his litigation as his major immediate prospect for money earning. It was said that the devastation of the plaintiff's bankruptcy was · the true major inhibitor of his business · career, and not his injury, and that. his earning capacity, past and future, was·not affected by the accident. It was also.said that the plaintiff's main supporting witness on the question.of economic loss, past and future, Mr. Murray D'Almeida was :not .. worthy of credit . . The defendant relied on a chronology of events which, it was submi-tte.d·, supported the notion that the plaintiff has in truth fabricated his claim or the basis of it. The District Court action by Jeruk Pty. Ltd. was heard on 8th/9th February 1989. Judgment w:as_given on 22nd February 1989 in favour of· Jeruk Pty. Ltd., ·with Jeruk Pty. Ltd. held not contributorily negligent. The~ writ in -this action was issued on 13th March 1989. The pla:i;ntiff was declared ·bankrupt on 22nd March 1989 and was discharged therefrom on 20th May 1992. In early February 1991, the -plaintif;f personally prepared all of his taxation returns for the year~ 1985-6, 1986~7, 1987-8, 1988-89 and 1989-90 (ex. 53, which also includes the returns for 1990-91 and 1991-92). It was said ·that .the.re was no satisfactory evidence to support the income declared particularly in the 1986-7 return on -- 31 of 84 -- 29 which the plaintiff- has based his claims -for economic loss and that the plaintiff knew that as a.bankrupt,.he did not have to pay income tax on the income disclosed, thus giving him a free rein to insert whatever sums he chose by way of income. . On 10th April 1991, Mr. D'Almeida prepared a statement (ex. 71) which, the defendant alleged, was based upon the plain.tiff' s taxation returns and which provided ·a false picture of the plaintiff's likely loss of income up to trial as well as false basis of assessing any future economic loss. Not only was credit in issue, but also the reliability and applicability of much of the evidence relating to economic loss as a basis for- assessing these parts of the plaintiff's cl~im. It is understandable that the defendant has attacked as a device, the plaintiff's claim that he can now work only 20 hours per week and that he can work only this number of hours for the- rest of his working life, having regard to his performance in various occupations since the accident, particularly with Kern Corporation at Mackay, and also having regard to the fact that. this number of working hours per week -was arrived· at ...___ progressively over the past few months before· the trial:. In my view, the plaintiff has exaggerated his case in many respects~ causing some concern. as to his credibility, but this is riot necessarily the end of the matter. The ·plaintiff's overall credibility must be judged in the light of his underlying personality and my assessment of him, having-regard to-all of the evidence and particularly the medical arid psychi~tric evidence. I have accordingly examined all of the evidence with care, and have looked where possible for objective and independent evidence -- 32 of 84 -- 30 to.corroborate in relevant respects, the evidence adduced on behalf of the plaint~ff. The plaintiff Mas born on 20th June 1953. At the date of the accident on 29th December 1986 he was thirty-three years of age. He is now thirty-nine . years of age. He said that he injured ~is left knee, his forehead and his neck in the accident. There is no acceptable evidence that he may otherwise have suffered·. some strain or injury to his back in the accident . . . He .said he experienced excruciating pain in his left knee "to the extreme .of screaming at the scene of the accident". He was.given a pain killing drug in the car before he was removed, and - then -again_ on the . roadway. He was taken to the Royal Brisbane Hospital and waited some three or four hours before he underwent.surgery. During that time he was given further pain killing drugs, but he said that this did not ease the severe pain~,. -·· He underwent surgery under general anaesthetic that night, and. was in severe pain thereafter. A pin was inserted in his left tibia. He was immediately placed in traction during the surgery and he remained in traction for some five to six weeks-. One week after his admission to hospital he underwent further surgery. His.knee.had been broken into thirteen pieces and an attempt . was then. made to put the pieces back. into whatever alignment was possible. He said he was in extreme pain after this surgery· also and was gi_ven morphine four-hourly and then pain killing tablets. W~en he was taken out of traction around the fifth or sixth week, he underwent phys~otherapy, but as the required range of -- 33 of 84 -- 31 movements could not be achieved, he underwent further surgery involving the breaking of the fractures and resetting of the knee. Also a week and a half or so after his discharge from hospital in mid-February 1987, he was rehospi talised and a further manipulation occurred to his left knee. ·This was the fourth surgical procedure with respect to his left knee to that stage. He said that the physiotherapy procedures caused him-- extensive pain. He could not sleep. Dur~ng visits of business associates to the hospital when business proposals were ----. discussed, he broke down and cried. He was extremely embarrassed about his personal hygiene. He said that hospital staff· were not looking after him in this respect and that his wife 1 visited the hospital almost all day to attend to him. He had gre-at difficulty in using the bedpan by-reason of the traction to his left leg and this also caused him extreme pain and embarrassment. Also his wife at the · time was involved in the in vitro fertilisation program, which necessitated the taking of semen from him whilst in hospital. He said that this also caused him much embarrassment. On arrival home, he said he could not traverse the stairs so he remained on a mattress in the downstairs rumpus room. He said he felt "like· a trapped dog" and that he broke down and cried. He said that he broke down and cried at least monthly. He underwent physiotherapy twice a day until June 1987. His wife drove him for this purpose. In early March 1987 he attempted to go back to work. Jeruk · Pty. Ltd. was Northern Regional Manager of the Retail Food Group -- 34 of 84 -- 32 since 11·th November, 1985. · Exhibit 62 sets out the plaintiff's work history ·before and since the accident. He was Managing Director and employee of Jeruk Pty. Ltd. which was paid $1,100 per week for services he rendered as franchise consultant to the Retail Food Group which- was then owned _ and controlled by Mr. Papoulias' interests, although Mr. Murray D'Almeida was also involved as a director at that stage until he finally took over full-control in 1988. That group then operated franchises for chains :called "Don ut King", "Baker's Bun", "BB' s · Coffee and Croissants", and "Top Chock", and in principle were compared to other food chains such as "Kentucky Fried Chicken", "Big Rooste·r" ,:. "Red Rooster", "Hungry Jacks", "McDonalds", "Wendys" and others. The Retail Food Group's franchises predominantly operated as take-away food outlets in shopping centres. _ The plaintiff went to the office two or three hours daily. His wif~ drove him. He·was unable to attend to these duties. He was undergoing physiotherapy at the time and that caused him pain'' and inconvenience. -He also had to exercise. He was using crutches and was suffering pain by the use thereof. He said he was desk.....,bound when his job required mobility. He said his concentration was very poor· and his recollection of events was "shocking". His left . leg was shorter than .. · his right. He was told by doctors,that be could expect degenerative arthritis in his knee and in his back,_and bone growth in his knee. He said this_caused him to:become depressed. The fourth.surgicalprocedure, a manipulationof the knee, was performed after consul tat ion. with Dr. _Tuffley. .He said he woke . up out of the anaesthetic screaming. - He was given pain -- 35 of 84 -- 33 killing injections. He was in hospital overnight. At home he said he could sleep only for 11 a couple · of hours" due to exhaustion. At a business meeting at the Gold Coast in March 1987 at which his wife accompanied him, he broke down. He left the meeting, met a director the next day, broke down again, and resigned. He said his future was then non-existent and that he did not know where he was going. His relationship with his wife suffered. It was very stressed. He described this as "terrible" and "shocking", because of his frustration, and pain, and because _., he "just lost control of my environment". He said that normal marital life did not exist. His wife gave evidence which· in various respects, corroborated the plaintiff. After his resignation in late March 1987, he went to his sister-in-law's home at Ayr for about two weeks. During his time he did some limited work for his former employer, the Retail Food Group. He underwent physiotherapy twice daily at ·Ayr and a further manipulation was performed by Dr. Trezise. This again caused him severe pain. He then returned to Brisbane and commenced working as Managing Director for Mr~ Jack Samardzija and Mr. George Acropolis who controlled an organisation called Australian Consolidated Foods Limited which operated a chain called "Dial a Chicken". The plaintiff operated in Brisbane, Sydney and Melbourne. He continued in this employment until February 19·88 when he resigned due, he said, to the fact that the owners had dissipated the funds of the company which he had generated. The business failed. He was guarantor of the company's debts and so -- 36 of 84 -- --·---------~~- 34 had incurred heavy personal obligations. During his time at this work, he said that his physical and mental health and concentration was "shocking". He used a cane to aid his walking. He said he took to this work because he·could not give in to the reality that he could not do so., He said he was driven to it and that he did not want-to face the fact that he could not do the work. He said that on his return home from work he collapsed. He was in constant pain ;from his knee and depressed. ~ From April to November ·198H, he took on the position as ~ manager of two shops, "Top Chook" and "Donut King" at the Transit Centre at Roma Street Brisbane. The stores were operated by Howdeen Pty. Ltd. The plaintiff said he worked 40 to 45 hours per week· in this position. He said he was unable to perform the duties· of manager of those shops because of his lack of mobility and·, pain and lack of concentration and because ·he was not mentall'y handling the situation. He said he was spending a lot of'time.in his office vegetating, rather than in actively being engaged as · manager · in the running of the shop in a hands-on fashion~ .This depressed him. These businesses later failed and the company Howdeen Pty. Ltd. was subsequently wound-up on the 29th September,. 1989. There was a large surplus of liabilities ove~assets in the order of $912,000. From 21st November 1988 to 12th May 1989, he was sales manager·of Woolworths at Carindale where he was retrained into a position of store manager ,with that organisation. From January to:April 1989 he was store manager for Woolworths at Sunnybank. He h:ad previously worked from 1972-:-1976 and from 1980 .to 1985 for Woolworths in executive positions and had been promoted from time -- 37 of 84 -- 35 to time to senior status. He had been then very highly regarded and was recommended by Mr. Barry John Scott, Regional Manager, for re-engagement with Woolworths. The plaintiff said that he could not perform adequately the position of store manager at Sunnybank because of pain in his left leg and back. He had difficulty walking and the·position required that he spend ninety-five per cent of his time on his feet moving around the store, having contact with staff and ~ customers and ensuring a high degree of productivity of the~ store generally. Relationship with staff ·and his ability to communicate deteriorated as a·result of which, senior management considered dismissing him. Mr. Scott was the plaintiff's superiorr and gave evidence which confirms the plaintiff's account. He was the·plairitiff 1 s supervisor prior to the accident when the plaintiff worked with· Woolworths. During that time Mr. Scott said the·. plainti·ff was ~ one of the better managers employed by Woolworths. He was a most enthusiastic person and was performing well~ Mr. Scott was also his supervisor after the 21st November, 1988. He said that a successful store manager had to spend about 80 per cent of his time out of the office and that managers who attempted to run a store from the office were generally· unsuccessful. He said there was no comparison between ·the plaintiff's ·performance then as compared with his performance prior to the accident. He said that the plaintiff was struggling and that·he had to counsel him from time to time. The plaintiff complained of·pain>in his.leg and said that he was receiving treatment and hoped ·that his performance would improve. · Mr. Scott said that the plaintiff was -- 38 of 84 -- 36 always positive in his approach although·his positive attitude was not translated into actual performance. The plaintiff in fact resigned from this .position in April 1989 without giving notice to Mr. Scott. The plaintiff said he did-this because he was unable · to successfully do the job. I was impressed with Mr. Scott's independent evidence which, in important respects, is:corroborative of the plaintiff. On .22nd March 1989, the plaintiff was declared bankrupt because'of the failure of·the businesses operated by Australian Consolidated Foods Limited.. The plaintiff was responsible for debts of the company by virtue of guarantees which he had executed.· The plaintiff .told Mr. Scott of this position during his employment with Woolworths. In April 1989, Dr. Tuffley performed an arthroscopy upon the plaintiff's left knee. He noted dense fibre adhesions in all compartments and what he described as extensive intra-articular fibrosis. The.medical evidence shows that these findings meant that the plaintiff's knee was in fact painful. This is objective medical~evidence which corroborates the plaintiff's complaint of pain in his left knee and restricted mobility. The plaintiff said that the· .condition of his left knee was not improved. He received advice-that he could expect that his knee would be on an even <teclining scale. of mqbili ty until he needed a knee replapement which he was told should not be done until later in life, at least age fifty ye:ars. He _was al~o advised that he coul<i. expect increasing pain from arthritis in the spine and_ that he•sho~ld find a sedentary type job and get off his feet. -- 39 of 84 -- 37 From 27th April 1989 to 24th August 1'989 he · took on the position as sales manager of Accord Manufacturing and Marketing from which position he was ultimately dismissed. He said this occurred because he could not perform work which entailed his being on his feet most of the time. See the letter of dismissal dated 24th August 1989 attached to the taxation return for year ended 30th June 1990, in which the director referred to the plaintiff's inability to perform due to his leg. He said he lost ----~ control of himself at that stage. He said he was lost, suffered frustration, depression and pain and that he was out of control. He was no longer a help or support-to his wife with respect to difficulties suffered by their baby daughter who was born on 4th August 1989. He said "it sank me into an ever_spiralling depression". From 4th October 1989 to 20th December 1989 he was on sickness benefits. On 27th November 1989 he obtai_ned emplb'yment- \.___/ with Kern Corporation at Mackay as shopping centre manager and also to overview and manage a $23- million expansion to that centre. He claimed that the job required him to be on his feet through most of the day and that this caused him much pain and discomfort in his left leg and back. He worked about 60 hours per week on this job and lost no time off. He said that he had~ great difficulty carrying out administrative functions. - His concentration was poor due to pain. Report writing took considerable time and difficulty, a function which he performed expeditiously and efficiently before the accident. He slept three to four hours per night. He was still subject to·bouts of weeping, but not as frequently as previously. -- 40 of 84 -- 38 .The plaintiff said that he had expected to be promoted to the position of national leasing manager with Kern Corporation. That would have be~n a significant advance in his career. He said that this would have involved a Brisbane office job with less time on his feet. It nevertheless would have involved interstate travel. He was confident at the time that he could have handled this job had it come to fruition although he later claimed that . in hindsight he would not have been . able to satisfactorily perform it~ It appears that the position did not come to fruition when Kern Corporation later got into financial difficulties. He left Kern Corporation on 25th October 1990. In his letter of resignation of 18th October 1990 (ex. 85), he gave two reasons for his resignation. The first was Kern's inability to carry through with his promotion to National Leasing and New Business Manager'and also his failing health causing loss of productivity. :.He visited Dr. Trezise in Ayr before he . returned to Brisbane. He was advised to rest, to get off his feet, lose some weight'and· take stock. He again went on to sickness benefits from 19th·December 1990 to 13th March 1991. He also took tablets for pain in his leg and back~ During this period he again saw Dr. Tuffley who advised him to rest. .He said this· imposed a dilemma on him because he could not support his family on sickness benefits .. He then took up a position ·in January 1991.· with Doug Robbie and Associates, a property development group, as a leasing consultant. That organisation managed two shopping centr~s, one in Brisbane and one.on the Gold Coast. For the purpose of this employment a I -- 41 of 84 -- 39 trust company was established called K. & _T. Property Investments Pty. Ltd. which employed him. The beneficiary was the Kerry Anne Bryce Family Trust. It received income of $1,000.00 per week for his services and he was paid a wage by the trustee company. It appears that this position lasted until about July 1991. He said he was able to do the work but was hindered by pain in his leg and back. He worked 40 hours per week. Report writing took three to four hours whereas before the accident it took him only about one hour. He said this was due to difficulty with. concentration. On about 1st August 1991 he commenced employment as a· consultant/business systems adviser to the Herdville Group of companies operated by Mr. Allan Harvey. That. organisation operated a bakery, a donut shop and a Chinese restaurant at Toowong. The plaintiff was employed to set up a pizza shop at Taringa. He had to rebuild it, refit it, systemise it, staff it- ~ and train the staff so that the store was. taken into profitability. This position involved a fair degree of. physical work. He was paid $1,000.00 per week. Mr. Harvey required him to renegotiate the leases of three shops at Toowong with the landlord. This involved reports which he said.· caused him difficulty through lack of concentration which flowed mainly.due to pain in his leg. He was on his f~et seven ·to eight hours.per day. He said that in January/February 1991 he was working up to 70 hours per week on some occasions~ He also did some physical work for Mr. Harvey including tiling. This caused him considerable pain in the leg and back arid necessitated a day off work recuperating. He said that thereafter his .hours--diminished -- 42 of 84 -- 40 from 50, to 40, to 30 to the present time when he is doing 20 hours per week only. In February 1992, his salary was reduced to $700.00 per week by Mr. Harvey but Mr. Harvey lent him the additional sum of $300.00 per week which Mr. Harvey said was to be repaid out of the plaintiff 1 s court settlement in this litigation. The plaintiff said that the reduction in salary was because he was not handling the work load. The salary was restructured to a fee for less work. This involved about 35 hours per week. As of 1st July 1992, his salary was. further reduced to $400.00 per week for 20 hours of work because he said he was not handling the pre-set level of work. Mr. Harvey gave evidence which corroborated this and said that particularly with his proposals for expansion, he would certainly be prepared to continue to employ the plaintiff in the future. In re-examination however, he said that this would be limited to 20 hours per week but this must be read as based on the Q: plaintiff"s present physical and mental condition and performance. Mr. Harvey 1 s evidence makes it clear that he highly regarded the plaintiff as a member of his senior management team, even with his disabilities, and it was not put to him what his attitude would have been if the plaintiff 1 s leg pain was removed, his mobility improved, and his mental attitude changed. The plaintiff said that prior to this reduction in hours, his work impinged on his family life. He came home exhausted. He was not sleeping at night. "I was back in the whirlwind with no quality of life." He attributed this to pain and exhaustion. He said he was just existing, coming home exhausted, going to -- 43 of 84 -- 41 sleep on the floor with his leg propped up and sleeping in any other room but the main bedroom. He said that generally he had no quality of life at all. He said that on this last visit to Dr. Walsh, the psychiatrist, in July 1992 the doctor told him to take stock and slow down. As a result of his working 20 hours per week at the date of the trial, he said that he was then given a reasonable quality of life where he can come home and relate to his family. He said that he is now sleeping the majority of the time with his wife. He has time to spend with his daughter. He said that pre-accident he and his wife were very sexually active but since the accident sexual intercourse at times did not occur for up to six months with recent frequency in the order of once every two months or so. This has been a strain on their relationship. The plaintiff said that before the accident he was actively engaged in squash, surf skiing (body surfing), and was a member C of an indoor archery club. He said he was engaged in archery and squash weekly and he went body surfing weekly or fortnightly. He and his family went camping when possible and usually in the order of every three or four months. When asked had he done any of these things since the accident he said "Not one of them, no". He said that he had tried body surfing in the surf but could not stand due to his leg. He tried archery but could no longer pull or draw back the bow. As to squash, he said "I have tried but that was a joke. It lasted a few minutes". He also said he had an interest in motor vehicles. He used to spend hours to keep his vehicle in pristine condition. Since -- 44 of 84 -- ,- 42 the accident he has.not washed a car for months. He mows the lawn once every six or seven weeks which causes him pain. In cross-examination he said that in order to succeed in the type of work he was doing for Mr. D'Almeida before the accident, the requirements were 100 per cent mobility, agility, intelligence, high communication skills and a sound background in retail. Mr. D'Almeida agreed with these requirements. The plaintiff said that mobility was everything. It was his whole life, and that he no longer had it. He said ·that with his mobility taken away, he was left with nothing functional. Most of these qualities also appear to be necessary to successfully perform the position of Store Manager for Woolworths, although there are other executive positions which require a lesser degree of_mobility and.which the plaintiff could probably perform. He also said that during his time at Kerns in Mackay, his skills ;vanished. He said he was moody and over-reacted with staff and to situations. He said that his management ability was impaired,.making him more introverted, less sure of himself and less confident. He regularly spent more and more time in his office and tried to keep off his feet more. Nevertheless, he said he gave 11 0 per cent to his job and regularly worked 60 hours per week at that. job with no time off. His lost his driver's licence on one occasion and rode a bike to work he said for a couple of days per week for a few weeks and for exercise. He said that this caused him severe pain and so he gave.itup. He said he was 13~ stone in weight before the accident and was at the trial close to 18 stone. 0 0 -- 45 of 84 -- 43 The plaintiff denied that the years of·anguish suffered and the down-turn of his business career was the ·legacy of the "Dial· a Chicken" enterprise in Melbourne, as a result of which the plaintiff went bankrupt, with debts in the order of about $9 million, rather than the result of any physical disability. He also denied that his powers of concentration and intellectual powers were as good as they were ever before. He denied that he deliberately in 1992 adopted the approach of working only 20 hours per week as a strategy, when since the accident he had otherwise worked at jobs of up to 60 or 70 hours per week. He said:- "I have tried every job I had on the way up the ladder, I tried on the way back down. I have come tothe realisation that I am what I am at the moment." Whilst giving evidence, the plaintiff said that he had a burning sensation in the top of his back about 10 or ·12 inches below the neck and also a dull throb in his left knee. -He said that had he been working the pain level in the knee an~ back would be more serious. On one occasion early during ·his evidence, he asked if could stand up to relieve discomfort but '-- . ../ this was not repeated at any later stage during his several extensive periods in the witness box. There is medical evidence that minor pain in the plaintiff's back can occur becaus·e ·of compensating curvature of the spine and also some medical evidence that the plaintiff could expect some discomfort when seated although Dr. Toft could find no organic basis for pain when sitting (ex.11). The fact that the plaintif~ complained only once when in the witness box, was seized upon by senior -- 46 of 84 -- 44 coun~el for the defendant as an indicator that the plaintiff had exaggerated his evidence. I closely obs~~ved the plaintiff during the course of his evidence and noticed that he was shifting his position from time to time as he was .. in the witness box. Having regard to the medical e~idence, I conclude-that this was an indication that he was experiencing some degree of discomfort, particularly with his knee, although,! have.not overlooked the fact that the plaintiff was to ~ome extent exaggerating his back pain. There is also some medical evidence to the effect that the plaintiff may have been exaggerating. the degree.of back pain and discomfort. Senior counsel for the defendant also relied upon evidence regarding .. squash playing as indicating that the plaintiff had lied about his ability to play squash since the accident. It was said that he told Sue Lister, physiotherapist that he had not played ~quash since_the accident. However, a close examination of her evidence in.dicates that this is not entirely clear. There is-other evidence from the plaintiff's wife, Mrs. Brice, that the plaintiff played squash on several occasions (although she did . ' not accompany him and observe his performance). There is also evidence gi~en by Helen Coles, occupational therapist and by Mr. Mai~waring and Mr .. Kemeny, employees of Kern Corporation at Mackay at the time the plaintiff was employed there. Mr .. Mainwaring gave evidence that the plaintiff played squash with him on several occasions. He. said in all these amounted to up to a dozen times. He said that the plaintiff in the early years showed."very minimal movement" about the court. The plaintiff had been a graded player before the accident and .' 0 -- 47 of 84 -- 45 was a positional.player. As time went by Mr. Mainwaring improved to the point where the games with the pl-aintiff were more competitive and much more effort and movement was put into the game by each player. He said the games were usually 10 to 15 minutes but could last 20 minutes each. He said movements were "short, sharp bursts" for four to five steps to get at the ball. However, Mr. Mainwaring said that on two occasions on the squash court at Mackay the plaintiff pulled up ·on the squash court whilst moving around and said "we have to sit down for a few minutes, my leg is giving me trouble". The plaintiff said that his attempts to play squash were no more than a "hit and giggle" and were never vigorous as put to him. He was part of a management team and in his position it appears that he ·was expected to participate to what extent he could in social activities involving executive personnel. Indeed, Mrw Kemeny, the supervisor of the plaintiff anfr Area ~ Manager of various large shopping centres owned by Kern \____./ Corporation, said that the social side was important; He said that he arranged a function in Townsville where various managers could come together and discuss problems. No doubt this was designed to foster team spirit amongst the executives who were expected to participate. The plaintiff said that he was aiways positive in his attempts and efforts to do what he could, even if it caused him pain. This is supported by Mr. Scott as well as by medical evidence. There is also the medical evidence, particularly that of Dr. Tuffley and Dr. Morris, that the plaintiff's medical condition would have prevented him playing a vigorous game of squash. -- 48 of 84 -- 46 Mr. . Kemeny and Mr. Mainwaring said that the plaintiff appeared to perform his job satisfactorily at Kern Corporation and never complained· of knee disability. Mr. Kemeny said that the plaintiff moved about satisfactorily with him on inspections at a "stroll" lasting from half an hour up depending on exigencies. He said that the plaintiff was very enthusiastic in the performance of his work, he was reliable, and always did what was expected of him.. Mr. Kemeny said the plaintiff was one of the company's better communicators. He said that the plaintiff was also excellent in his report writing. It appears that the plaintiff's managerial capabilities are supported by the evidence of Mrs .. -Coles, occupat_ional. therapist. It was submitted for the defendanb that the plaintiff general behaviour at Mackay must be looked at as a window into his real capabil_ity and that even with his knee injury, he was able to perform enthusiastically and conscientiously and for long hours. As such, _it was said that his earning capacity.was the same as before the accident despite his physical limitations. Other reasons were.advanced on behalf of the defendant to show that· the plaintiff .should be found to be an untruthful witness who had employed a strategy in an attempt to boost his damages. I have.taken all of these matters into account. Of considerable importance in . assessing the plaintiff's overall credibility, is the psychiatric evidence concerning the nature of the plaintiff's personality, and the claim that the plaintiff suffered a. depressive illness and ·a post-tr.aumatic stress disorder. I c 0 -- 49 of 84 -- 47 There is ample evidence which I accept that before the accident, he was an out-going, confident and enthusiastic person. He was positive in his approach to life and to his work and enjoyed a happy relationship with his wife and friends. There has been a substantial change since the accident which included emotional outbursts and weeping, although the evidence shows that his mental condition and attitude is improving. Nevertheless, after the accident, the plaintiff was always positive in his approach to his activities, even though that approach was not always translated into performance. Dr. Walsh, psychiatrist interviewed the plaintiff in Jurie 1991 and had access to statements from the plaintiff's w±fe, and others as well as to various medical and other reports set out in ex. 7. Dr. Walsh said:- and "Since the accident he had noticed a dramatic change. He had suffered from periods of depression which he regarded as lasting for days at a time. He commented, that they would improve if his wife could encourage him to discuss problems. He described himself as having low self-esteem and low confidence. His appetite increased as did his weight. He-increased his weight by approximately five stone over a period of four to five years. His energy levels were· diminished as were his memory, concentration and sex drive. His sleep pattern was significantly. disturbedwith difficulty going to sleep and then waking. He also now regularly wakes at an earlier hour than he did prior to the accident. He initially denied any suicidal ideation but on specific questioning did admit that the thought had crossed his mind but no plans had been formulated. He was also able to· describe headaches and feeling that his abdomen was in a knot. He had noticed a persisting leg and back ache. Pain occurs particularly if he has to stand for any significant length of time. He felt that he was able to stand for only approximately five minutes. If he did not then sit and change his posture, this would ultimately lead to back discomfort." -- 50 of 84 -- 48 "OPINION As a result of the motor vehicle accident, Mr. Brice suffered th'e orthopaedic injuries associated with his left leg. This injury resulted in him losing control of his environment. He subsequently developed a significant depressive illness as indicated by his poor tolerance of pain, his withdrawal from contact and. the impairment of energy, memory, concentration and sex drive. He also developed a post-traumatic stress. disorder .and residual features of this disability remain at this time. Mt. Brice's underlying personality shows marked obsessional features. In an individual with features of this kind any loss of.control leads to disintegration of their functioning. " · · I do not consider that he has dealt with the multiple losses which,have occurred over.the last five years. It would appear from -his statement that he has lost signif.j.ca:ntly in a financial sense but more importantly in psychiatric terms he has lost control of the direction in _his life. There is some indication that control may be returning and if this .is,to continue then his long term disability will not be quite so marked. He has also lost his sporting abilities and the relationship with his wife has been significantly impaired." (Emphasis added) Dr. Walsh maintained this opinion in his later reports ex. 8 (2nd September 1991) and ex. 9 (1st July 1992), and disagreed with the views of Dr. James called by the defendant. In ex. 8, after.. stating that embarrassment would certainly have been another fact contributing to the plaintiff's post-accident depression, Dr. Walsh said: "In relation to the future economic loss, Mr. Brice had a significant loss of control of his environment and his direction in life. Certainly it is my opinion that the depression and Post Traumatic-Stress Disorder acting on his underlying obsessional personality significantly influenced business decisions made up to this point in time. As I have indicated in my Report, however_, there is some indication that control may be returning __ and that" .Mr. Brice is again beginning to improve his chances of re-~stabl~shing himself in the business world. I would have thought, however, that if he is able to deal ~ore appropriately with the losses·- which have occurred since the accident then he may improve even further. His future-career prospects would therefore, have been impaired only insofar as he I .' n~I -- 51 of 84 -- has not performed his duties since the accident in the manner which would have been expected had he not had the accident. He is, therefor~, not so advanced in the business hierarch~. I do not consider that the psychiatric injuries which he has experienced would have any sigrtificant effect upon his working life though it is possible that thechronic pain may lead to any early retirement. Given Mr. Brice's underlying personality and his indication that control is returning, it is my expectation that he will again function at guite a competent level in spite of his disabilities." (Emphasis added) It may be noted from that evidence that Dr. Walsh was basing his opinion as to the plaintiff's future prospects on the premise that the plaintiff would continue to have chronic pain in his left leg for the balance of h~s life. He was not adverting to '-__./ the situation if the pain in the plaintiff's left leg was removed by surgery and if the plaintiff's mobility was generally improved as a result of that surgery. Of significance is Dr. Walsh's opinion that even with pain in his left knee, the plaintiff's underlying personality coupled with return of control,. would ~ allow the plaintiff to function at quite a competent level in \ __ spite of his disabilities. In ex. 9 (1st July 1992), Dr. Walsh said: "Mr. Brice has not, in my opinion, come to terms with the losses which have resulted from the motor vehicle accident. His obsessional nature leads to his wanting to continue to perform at his pre-accident levels.Clearly, he is unable to ·do this, leading to frustration and annoyance. I £urther consider, thatthe depressive illness alluded to in my earlier Reports, is still in evidence and it is only with adequate treatment and direction that Mr. Brice willagain be able to function at an adequate level. Even with treat~ent, he wilL never be able to·function atthat level which he did prior to his' accident. ··- This · limitation, however, will in that event be due·to hisphysical disabilities~ I consider that Mr. Brice should attend for treatment· which would include anti-depressant medication and ventilation to allowhim to come to terms with his disabilities and theconsequences of these upon his day to day ·life. I -- 52 of 84 -- 50 would estimate that this could occur over a period of approximately six months with consultations at approximately 2-week intervals·. The cost of these consultations, therefore, would be in the realms of $1000.00." (Emphasis added} Dr. Walsh also gave oral evidence. He made it clear that whilst the plaintiff suffered a post-traumatic stress disorder which. began from the time the plaintiff first went to the hospital in December 1986 and well before his bankruptcy in 1989, this disorder has certainly_diminished with time. He said that the plaintiff had improved to the extent that he now has a fairly normal recall of events and_ nightmares had also ceased. He said that with an obsessional personality, the plaintiff focuses on things that are important to h.im which may not be objectively important to the casual observer. When asked in evidence-in-chief about whether 20 hours per week of work at the present time was appropriate Dr. Walsh said: "I .think that that is only a start. I think that Mr. -Brice still needs to adequately address the loss which has occurred and come to terms with the effect of those reduced hours upon him. What I would suspect would be that he may well reduce hi.s number of hours for a period of time, but then gradually take on more and more until he is again working at an appropriate rate, unless he can also deal with those other facts." Dr. Walsh was of the opinion that because of the plaintiff Is underlying personality, he wished to do things to perfection and to carry them through to his fullest capabilities in an attempt to perform those duties in a manner he had been able to do so before the accident. He said that with the plaintiff 1 s injuries, and particularly the pain and restriction on mobility, the plaintiff was physically unable to perform as he did previously, even though he put on a bright face. Any reversal .has a more cogent effect on a person with an obsessional personality such .. . -- 53 of 84 -- 51 as the plaintiff. It follows from Dr. Walsh'~ evidence and-from my observations of the plaintiff, that with his ob~essive personaii ty, he would be disposed to maximise his claim for damages as far as poss~ble. In the passage quoted abo~e from ex. 9, it is clear that Dr. Walsh's statement that even with treatment, the plaintiff will never be able to function at his pre-accident level, was· based upon the premise that this limitation was due to· the plaintiff's physical disabilities. This was also made clear ·from his oral evidence. Dr. Walsh agreed· that pain was a most significant factor and that if pain was alleviat~di this would be an enormous help to the psychiatric side of the plaintiff's problems. The plaintiff himself agreed that if pain was removed, this would go a long way towards restoring him to his former self. In saying in evidence that the plaintiff could never be returned to his pre-accident status, Dr. Walsh was responding to r--- a question regarding a total knee replacement leaving the plaintiff essentially without pain in his knee thus providing an enormous positive indicator towards the plaintiff's future "----" ability to cope. Dr. Walsh agreed with that proposition, but it J .~ l \\ is clear that he was saying no more than that the plaintiff would still have a permanent disability to his leg and so could not physically be fully restored to his pre-accident status. I generally prefer the opinion of Dr. Walsh to that of Dr. James and conclude that the plaintiff did develop a significant depressive illness as a result of the accident and a post-traumatic stress disorder both of which preceded any financial loss he suffered as a result of his time with -- 54 of 84 -- 52 Australian Consolidated Foods. Those troubles were an added impetus to this difficulty but were not the cause thereof. However, it was .conceded by senior counsel for the plaintiff that it could not be proved that there was a direct legal causal connection between the accident and the bankruptcy . .I. also accept Dr. Walsh's opinion that the plaintiff has an obsessional personality and that this has always been a characteristic of the plaintiff. Because of this characteristic, I accept that his psychiatric problems significantly influenced his attitude to making decisions and because of this he has been unable .. for ~;~. considerable time to come to terms with the results which have flowed from the accident. On the other hand, . and particularly having regard to my assessment of the plaintiff, I als~ acc~pt Dr. Walsh's opinion that the plaintiff's control is now improving and that with treatment over six months or so as recomme~ded by him at a cost of about $1,000.00, the plaintiff's condition in this respect will be totally alleviated and particularly if it is possible for him to have an early operation on his knee to substantially relieve if not totally eliminate all pain and improve his mobility. It is therefore against the background of the plaintiff's personality that his overall credibility should be judged. I am of the view that he did exaggerate and sought to maximise his claim. He has sought to advance his case in the most optimistic light. I have made due allowance for this factor and where possible have looked for corroborative evidence. This does not meaQ however that the Flaintiff did not suffer serious injury, or that he did not develop a mental condition as described by I \;\ -- 55 of 84 -- '' 53 Dr. Walsh. Nor does it mean that he did not have difficulty in performing various tasks which he has attempted. I find that his personality was such that after the accident, he was likely to and did attempt to do what he could do before the accident, not only with regard to his work but also· with regard to leisure activities, with varied d~grees 6f success, and with a p6sitive attitude that ~ay h~ve misled a casual observer as to his true capacity. I also accept that whilst ·the plaintiff left Australian Consolidated Foods ostensibly due to the financial situation of ~ that organisation at the time, he nevertheless would have been unable to continue in that work for any length of time by virtue of his physical and mental disabilities. I also accept that pain in the plaintiff's left leg along with restricted mobility has played a significant part in his inability to sustain employment in various occupations since the accident and notwithstanding that he at all times put on a po~{tive front. I conclude that he would not have been able to continue· indefinitely 'in his occupation with Kern Corporation at Mackay, given his physical and mental disabilities at that time. He not unreasonably acted on medical advice then available to him to the effect that it was not desirable to have a knee replacement before aged about 50 years. With respect to the plaintiff's progressive r~duction of working hours with Mr. Harvey since February 1992 to a point where he is now working only 20 hours per week, I have examined this evidence with considerable care. Having regard to the medical evidence and my assessment of the plaintiff, there is no -- 56 of 84 -- 54 reason not to accept Mr. Harvey's conclusions in this regard up to the present time. This is based upon the premise that the plaintiff suffers substantial pain in his left knee, has restriction to mobility, and has a psychiatric problem thus affecting his overall attitude and performance. In this regard I find it probable that, given Mr. Harvey's opinion of the plaintiff's abilities and his definite statement that there would be a continuing place for the plaintiff in Mr. Harvey's expanding organisation in the future, Mr. Harvey's attitude as to available hours of work would be totally differ~nt if the plaintiff's pain is removed, his mobility increased, and his mental problems alleviated. So also with Mr. D'Almeida who gave what I regard as indefinite evidence-in-chief to the effect that he would not employ the plaintiff with his organisation in the future. His response merely was "I don't think so". He was asked only the position if the plaintiff were to have his leg '' c fused by an arthrodesis (which would result in a permanent Q disability of 50 to 60 per cent, a further shortening of the leg and reduced mobility but with pain relief in the knee) and left I with further continuing back pain. He was not asked the position C 1 if surgery removed the plaintiff's pain in his knee, his mobility improved, and his mental problems alleviated. If that result were achieved, I find it probable that persons such as Mr. Harvey or Mr. D'Almeida would employ the plaintiff in their organisations in the future on a full-time basis, notwithstanding the plaintiff's present age. The pain in the plaintiff's left leg and restriction of mobility are the major cause of his physical disabilities but -- 57 of 84 -- ' ' 55 these factors are also a major cause of his psychiatric problems. It is necessary to consider what surgery should be undertaken by the plaintiff to his left leg. I accept that his attitude to not having an arthrodesis at this stage of his iife is reasonable. Such a procedure would permanently stiffen his leg for life, would all but eliminate pain in the knee, but· would further shorten his leg so as to be likely to increase back pain due to further inequality of leg length if he did not wear built-up shoes at all times. There are some risks associated with such "--- surgery, but not very great. Also with a permanently stiff leg, the plaintiff's mobility would be more severely restricted than at present. He would have a permanent disability in the order of 50 per cent to 60 per cent. He would be inconvenienced in aircraft, in theatres, in entering and leaving vehicles, and in climbing stairs etc. I accordingly find that this is not the preferred course of treatment for the plaintiff at this stage of his life. The other alternative is a knee replacement. I also accept that the plaintiff's attitude to not having this procedure performed to date is reasonable, having regard to the medical evidence available to him up to the present. There is a difference of medical evidence as to when this should ideally occur, but in my view, this difference is one of emphasis. Some doctors said that it is most desirable at aged 60 and Dr. Tuffley said it is preferable not to perform such a procedure before the age of about 50. However, he said that there would be a reputable body of orthopaedic opinion contrary to his. Other specialists would perform such surgery at a much earlier age. Dr. Morris said that this is so. All doctors said -- 58 of 84 -- ' ( 56 that more than one knee replacement can occur in the state of present technology. Dr. Tuffley and Dr. Toft were of the view that a knee replacement could be expected to last for at least ten years and a second one could be expected to last a little less in the order of eight years. The evidence shows that even a third er perhaps a fourth knee replacement could be performed or alternatively an arthrodesis later in life. I prefer Dr. Morris' view (ex.. 83) that the life of a replac~ment is variable but that 11 one would expect it to last for C more than 15 years 11 • I alsoprefer Dr. Morris' overall evidence on this topic. He said that a knee replacement allows more (' movement, and would substantially if not totally remove his pain. \~. It would improve the plaintiff's walking around considerably, and in going up and down stairs and in other areas involving movement of ... his leg and general mobility. It would to a large extent relieve:, the. effects of osteoarthri tis to the knee~ Dr. Morris said that a person could comfortably stand on such a leg for say 0 se'?en hours per day and that even cleaners. have had knee replacements and performed their job satisfactorily. Having regard to Dr. Toft' s evidence that the plaintiff's permanent C disability of the leg would be between 15 per cent to 20 per cent after a· s~ttling-in period, and Dr. Morris' evidence that the permanept disability would be about 25 per cent, I find that the plaintiff's permanent disability to the left leg would be about 20 per cent after a knee. replacement. Dr. Morris said that as long as the patient was told fully of the ramifications of a knee replacement and_the risks in the future, and how he should adjust his lifestyle, the decision was I -- 59 of 84 -- .. 57 up to the plaintiff. Dr. Morris said that he would have no problem doing a knee replacement on a 39 year old man·who was in severe pain and unable to cope with an ordinary lifestyle, as the plaintiff claims, providing the procedure and the future were fully explained to him. The plaintiff himself said that if a specialist was to advise that it was reasonable for him to h~~~ a knee replacement now he would do so immediately. He was quite definite. Also Dr. Toft said that the plaintiff was getting to the stage where such surgery is "becoming a consideration''. I find that a knee replacement can.be successfully performed now and that with the pain the plaintiff suffers, with- ·its,· consequences to his activities both personal and business, and its major contribution to his psychiatric problem, he will probably undergo a knee replacement in the very near future. :on the evidence he should probably do so and indeed, ·senior counsel for the plaintiff submitted that the plaintiff should receive ~-. damages on the basis of his undergoing a knee replacement. ·I accept this submission. I find that this will probably last for about 15 years and even longer. A further replacement would probably be necessary when the· plaintiff is in the ·order of 55 years of age or perhaps a little older. With improved technology and experience, the second knee replacement is likely to last until well into the plaintiff's 60's. A further replacement or arthrodesis would probably then become necessary which would last the plaintiff for the rest of his li·fe. Allowance should therefore be made in the award for pain and suffering and loss of amenities for the discomfort ·and inconvenience of having to undergo this further ·surgery. -- 60 of 84 -- - - ---- -------------- 58 Allowance should also be made for the cost of the_ surgical . . . . ' procedures at present value as well as an allowance for loss of future earning _ capac/i ty for income lost during the period of surgery and convalescence, _and for any disruption caused to his income earning capacity as a result thereof during his working life. The weight of medical opinion supports the conclusion that he had a pre-existing back _condition which has become symptomatic to a minor extent due to the shortening of his left leg in the order of 3.75 to 4 centimetres, although there is evidence that this should be. minimised, if not eliminated, by his wear~ng built-up shoes which he does at the present time. There is also med~cal evidel).ce that he would have developed some. back condition in the ~uture, quite apart from the accident. In the result, I find that plaintiff suffered a severe injury_~~ his left knee, which to date has left him in pain with varying ?egrees of sever~ ty _according to usage, and without treatm~nt wf th a permanent disability in the order of 35 per cent to ~0 per cent and up to 50 per cent with pain. This will tend to increase over the years without treatment. His left leg is 3.75 centimetres to 4 centimetres shorter than the right, substantially corrected by buil t-:up shoes. His pre-existing latent back condition has to a minor extent become symptomatic following the accident and is alleviated by built-up shoes. He has suffered a depressive illness and post-traumatic stress disorder which preceded any financial loss and these disorders, when coupled with his obsessive personality, _have substantially affected his attitude and approaches to date. I find that his .' -- 61 of 84 -- _., 59 mental condition is now improving and will be totally eliminated with treatment over six months. From my observations of the plaintiff and the medical evidence, I find that he has good intellectual powers, and powers of communication, as well as excellent managerial ability. I am also of the view that his attitude to surgery to date has been reasonable and that following his positive statement that he will undergo surgery, he will do so almost immediately. This will almost if not totally eliminate pain and minimise further degenerative changes to his left knee, which will have- the effect of not only improving his mobility but will also substantially aid in eliminating his mental problems. Notwithstanding that he will never be restored totally to his pre-accident status because he will still have a permanent left leg disability of the order ·of 20 per cent, I conclude on the balance of probabilities that even at his age his e~rning capacity in most positions reasonably open to him will be unaffected, apart from the periods when he is undergoing future surgery and convalescence and perhaps adjustment after some disruption to his earning capacity on those occasions. His obsessive personality, his good intellectual powers, and powers of communication, his managerial skills and his performance since the accident in spite of his disabilities, gives added confidence to this conclusion. With surgery and treatment, the plaintiff has the capacity to earn income in an occupation equivalent to a national leasing -manager or master franchisee in an organisation such as that run by Mr. D' Almeida or to fill a senior position in retail management, shopping centre management -- 62 of 84 -- 60 or leasing, or an associated field of franchising. This includes a position with an ~rganisation such as Woolworths or as operated by Mr. Harvey who has expressed the positive opinion that he will continue to employ the plaintiff in the future. Mr. Harvey has plans for.expansion. As to the periods up to the present, and up to the time of his knee surgery and other treatment, the plaintiff has suffered and will in my opinion suffer loss of income. With respect to the period to trial, it is not, as submitted by senior counsel for the defendant, limited to s.ix months after the accident at $1,1 OQ per week gross giving a net sum of $20,000. Notwithstanding the fact that the plaintiff has tended to advance his claim in the most favourable light, I accept that he has to date tried his best to be actively and usefully employed and that he_has had difficulty in performing on a sustained basis each of the tasks he has undertaken. It was not suggested that sick pay receipts should in any way be brought into account. The pla.intiff's claim is put on two bases. The first basis adyanced by sen~or counsel for the plaintiff (as appears from the written submissions) is that the plaintiff's economic loss, past and future, may be assessed on the assumption of continued employment by Woolworths. He had in fact been employed by them from 1972 to 1976 and from 1980 to 1985 and again from 21st November 1988 to 13th May 1989 (Ex. 62, ex. 79). It was submitted that the figure~ clai_med ·therein were conservative and reasonable and were amply justified having regard . to Mr. D' Almeida' s evidenqe and the statement he prepared, ex. 71. ' ' -- 63 of 84 -- ., 61 The alternative claim is based upon Mr. b'Al~eida's stat~ment (ex.71) which is part of the report of Pannell Kerr Forster, chartered accountants (exs. 77, 78). As to the first basis, this is set out in ex. 79, which is subject to the letter from Big W (ex. 80) and ·adjustment following the evidence of Mr. John Scott which I accept. I accept the submission by senior counsel for the plaintiff and substantially as set out on pp. 40 to 42 of the written submissions, that given the plaintiff's history, it was likely that he would have achieved the full bonus of 15 per cent payable .-----... to the majority of managers so that for the year ended 30th June '"--'. 1992, the plaintiff's salary component would probably have been in the order of $69,000.00, with a fully maintained motor vehicle component of $13,000.00 per annum. Therefore, instead of the net salary package for the year ended 30th June 1992 of· $47,941.00 as disclosed in Appendix 1B/1 of ex. 79, the figure should he. in the order of $56,893.00, an increase of about $9,000.00. For the period 1st July 1992 to 2nd October 1992, the figure of $12,347.00 net salary package after tax should also be increased by approximately $2,500.00. I otherwise accept the accuracy of the figures disclosed in Appendix 1B/1. It follows that for any future lost earning capacity; if employment by Woolworths is the appropriate guide, the net figure of $47,941.00 is an appropriate net income package, but likewise adjusted to $56,893 .·oo. See Appendix 3B of ex. 7 9 . <[) exhibit, when adjusted, and allowing for present earnings· of $20' 800.00 pr annum gross (net $17' 442.00)' claims an alleged loss of future income of between $520,000.00 and $573,000.00, -- 64 of 84 -- 62 depending upon whether 21 o:J; 25 years was the approp~·iate years of purchase .. (Pp. 50/51 of the written submissions.) Appendix 2B of ex. 79 brings into account. the actual net income earned since the accident and up to trial as disclosed by the plaintiff's income tax returns.for those periods. I accept the income disclosed therein and_the figures derived as a result therefrom by Mr .. Cooper_ in ex. 79. Appendix 2B shows lost income to 2nd October 1992 of $67,557.00, but with the adjustments previously referred to of about.$9,000.00 for the year ended 30th June 1992, and $2,500.00 for-the period to 2nd October 1992, this give_s a_loss of income to trial in the order of $80,000.00. It was submitteo that an award of at least between $80,000.00 to $90, 000. 00. was warranted on this basis. However, a further consideration is the regular 5 per cent . discount on staff purchases to which the plaintiff would have been entitled had he continued in employment with Woolworths, as well as the prospect of further advancement. Taking ·all of these factors into account; it~was submitted that an award for _past economic loss in_ excess of that sum and in the order_ of $100,000.00 was justified because the figures contained in ex. 79 were only a guide as,to the plaintiff's true earning capacity. -- .. It . is next necessary to consider the large volume of evidence given by Mr. D.' Almeida who prepared the document, ex. 71~ ·It was said that this not only provided a reasonable guide to. the plaintiff'~ ~oss of income to trial as well as to his future lost earning capacity, but also tended to show that the submissions based upon c9ntinued employment with Woolworths was very reasonable._ ,. -- 65 of 84 -- 63 In support of the figures and forecast contained in ex. 71, much oral evidence was given arid a large number of documents were tendered with respect to activities subsequent to the date of the plaintiff's accident, of master franchisees of the Retail Food Group for the whole of Australia. It was said that this evidence showed earnings of master franchisees of various States, and which provided a guide as to what the plaintiff was likely to have earned had he not been injured and stayed with the Retail Food Group and had he in the ensuing years also become a master franchisee of that Group for Queensland. It was not in dispute that up to March 1987, the plaintiff via Jeruk Pty. Ltd. provided consultancy services for that Group for which it was paid $1,100.00 per week. See para. · -21 ·:of ex. 71 . It was accepted that this sum should be taken as earnings of the plaintiff. In addition, the plaintiff earned other income, about which there-was a dispute for the year·ended 30th June 1987 and in particular with respect to his earnings prior to the accident itself. Figures in para. 21 of ex. 71 are identical to some of the figures in the plaintiff~s income tax- return for that year (part of ex. 53 ) . They are . shop:....fit ' co-ordination fees paid to th~ plaintiff by the-shop-fitter·of~ $6,600.00, franchise fee bonus of $35,000.00, franchise commissions of $15,000.00 and mobile phone hire of $1,957.92. Paragraph 21 shows a total gross income of $99,154.78 for the period July 1986 to March 1987 (when the plaintiff resigned due he said to his injuries) . Mr. D' Almeida said that· if the plaintiff had not been involved in the accident, his 1987 income for the year ended 30th June 1987 "Would have well exceeded -- 66 of 84 -- 64 $110,000.00''. Using t~is as a base, Mr. D'Almeida added growth for the plaintiff's income at. a CPI .rate of 8 per cent plus 3 per cent perfm;mance faqtor to give .a total rise of .11 per cent per annum as follows: 1987 1988' 1989 1990. 1991 $110,000.00 $122,100.00 $135,531.00 $150,439.00 $166,987.00 Mr. D'Almeida saiffthat using the $166,987.00 as a base for the year ended 30th J~ne 1991, and "knowing the income being generated by our State ·franchisees, I would estimate John's current income (1991) to be no less than $166,987.00". This, of COUrSe 1 WOUld be the grOSS figure before dedUCtiOn .Of expenSeS and before tax. Mr. Cooper, a partner in the firm of Pannell Kerr Forster, in ex. 77, and as up-dated in ex. 78, used various source material on which he based his calculations of economic loss to trial and future economic loss. This included the plaintiff's . . taxation returns, ex .. 53, as well as ex. 71 and in particular the -above figure's in para~ 21 thereof. From the figures in para. 21, Mr·: Cooper ded~:cted expenses at the level incurred by the trust (Jeruk Pty. Ltd.) (see ex. 78, Appendix 2A/3) to arrive at what he· s~id ~as the net incom~ the plaintiff would have earned to 2nd,06tober 1992 of $737,432.00 gioss and $415,~00.00 net. From these figures he deducted the actual income ~arned since the accident· (Appendix ZA/2) to arrive at loss of income to 2nd October 1992 of $498,258.00 gross or $254,095.00 net. As to future economic loss, Mr. Cooper adopted Mr. D'Almeida's estimate of $166,987.00 for the year ended 30th June 1992, less expenses giving a net income before tax of .. ; -- 67 of 84 -- 65 $149,027.00 and $85,307.00 after tax (Appendix 2A/3, 4A). From this he deducted the plaintiff's present earnings of $400.00 per week (gross) namely $20,800.00 gross or $17,442.00 net, giving a lost weekly income of $2,465.09 gross or $1,305.10 net. At 5 per cent discount for 25.71 years, he arrived at a loss of future income of $1,860,891.00 gross and $984,894.00 net. To this he added the present value of lost income due to ·knee surgery and cost of recurrent expenditure and knee replacement .. As submitted by senior counsel for the defendant, the validity of Mr. Cooper's figures depend entirely on the accuracy and reliability of the base figures provided substantially by the plaintiff for the year ended 30th June 1987 and by Mr. D'Almeida. The figures in ex. 71 para. 21 were challenged. Some time before the trial, the defendant's solicitors made it clear to the plaintiff's solicitors that the defendant required all books of account and supporting documentation to substantiate the plaintiff's claims of income received by him with the Retail Food Group and on which his claim for loss of income to trial and.lost future earning capacity was based. This was particularly sought ~~ with respect to evidence expected to be given by Mr. D'Almeida for the period 1986-7 and up to trial. During Mr .. D'Almeida's cross-examination, it was necessary for him to stand down on three occasions in order to bring various records of his organisation to the court or to finally explain the fact that certain records were unavailable. Senior counsel for the defendant criticised Mr. D' Almeida' s credibility due. to this factor also. -- 68 of 84 -- 66 There is no evidence from the. records·of the_Retail Food Group or of any of its 'companies or from .. the bank statements or records o:e the plaintiff, _to substantiate the payment of $35, 00_0. 00 said to have been paid by the Retail Food Group to the plaintiff as a special bonus with respect to the franchise fee paid, by :·the Booval "Donut King" franchisee, in which the plaintiff had an interest. It was also said that there was no evidence to substantiate the franchise commission fee of $15,000.00, although there _is a deposit _of $15,000.00 in the plaintiff's_bank statements, but no evidence of a payment in any records of the Retai.l Food Group. This is unsatisfactory and_ the challenge to khe accuracy of these payments, particularly as to the: $35,000.00 1 is quite unde.rstandable. However, the challenge with .. respect to the $35, 000. 00 did _not establish .that this sum was not paid to the plaintiff or that it could not have been paid into one of his accounts with other funds or that he in some other way disposed of it. The plaintiff and Mr. D'Almeida swore that it was .paid and .I accept that it was. Nevertheless, there are substantial reasons forcriticism of the figures in ex. 71 and the use to which they can be put as a guide to assessing the pl~intiff 1 s lost income to trial and future lost earning capQ.ci ty ~. It must first be mentioned that Mr. D'Almeida made it clear throughout his evidence that pe was engaged in the technical side of the business and .that he was not an accountant. He left the accounting and financial matters· to others. Much of what he advanced in evidence was heresay and was . not supported by satisfactory documentary or other evidence, -- 69 of 84 -- 67 The master franchisee system did not commence until ·about 1988/1989, according to Mr. D'Almeida. tt appears that the first master franchisee was in Victoria and this commenced apparently late in 1988. In other States, they commenced somewhat later. In Queensland, a master franchisee, Mr. David Robert Cameron, did not commence until May 1991. There is some suggestion that had the plaintiff. not been injured, this system would have ·been introduced in Queensland somewhat earlier, although I find that this suggestion has not been satisfactorily established on the evidence. In any event, there is no acceptable basis on which an assessment of economic loss could be made on this assumption. Nor do I find that any assessment can be made on the basis of the suggestion that had the plaintiff not been injured, the Retail Food Group intended to advance a chain called "Top Chock"'· which would have involved the plaintiff and so produced substantial earnings. I accept that the plaintiff was experienced· and' had· a reputation in the shopping centre leasing industry and' was well-known for his shopping centre management. This was largely '--._/ due to his experience with Woolworths for ·substantial periods from 1972 to 1976, and from 1980 to 1985 (ex. 62). He was "head hunted" by Mr. D'Almeida's organisation and commenced with the Retail Food Group via Jeruk Pty. Ltd. on 11th November 1985.' His responsibilities then were to franchise existing stores already fitted out, to find· new sites for various franchisees, to franchise new sites, and to operate within a territory from Port Macquarie in New South Wales to Darwin in the Northern Territory: He was subsequently required to overview the profitable running -- 70 of 84 -- 68 of a Queensland· state office, to· overview· the national shop fitting operation~ to franchise all new sites in his region, to locate new sites in his region, and to overview equipment acquisitions nationally.' By the end of 1986, the plaintiff had franchised 21 stores in his region and 28· stores were fitted out nationall~. He had put in place a further 12 stores for 1987. The Retail ·Food Group, through the plaintiff's efforts, acquired leases from shopping centre developers and elsewhere. When the plaintiff found a buyer (a franchisee), that buyer would pay $35,000.00 for the site:and become the sub-lessee of the site from·the Retail Food Group. The term apparently was for the term of the lease held by the Retail Food Group of five years less one day. F.rom November 1985 to March 1987, Jeruk Pty. Ltd. was paid $1,100.00 per week consultancy fee for the plaintiff's efforts. He· also.received certain other remuneration and reimbursements of expenses . · Mr~ ·o'Almeida said that for the years after 198~/87, he discussed the future -income of Jeruk Pty. Ltd. with Mr. P.apoulias, who had control of the Retail Food Group until 1988 when Mr. D'Almeida took over that control. There was a discussions as to whether a future annual bonus for Jeruk Pty. Ltd.· would be between $35,000.00 and $50,000.00. Mr. D'Almeida said·"We discussed whether there would be a bonus or something along those lines. It was for· future discussion".· Thus at the date. of the accident, no firm proposals had been put in place for the years following the 1986/87 firiancial year. In March 1987, after the accident, the plaintiff was offered the position of National Franchise Manager which he did not take up. There is -- 71 of 84 -- 69 no acceptable evidence of what his earnings would have been<t,mder this proposal. Mr. D 1 Almeida said we 11 never got down to the nitty gritty 11 • Also, the continued viability of the Retail Food Group was in question, having regard to the fact that the company which operated the franchise business for that group until June 1991, DKM New South Wales Pty. Ltd., was eventually put into liquidation in August 1992. Mr. D 1 Almeida took over control from the Papoulias interests in 1988 and it was only from 1st. July 1991 that Mr. D 1 Almeida 1 s new companies, Donut King Australia . Pty. Ltd. and BB' s Coffee and Croissants Australia Pty Ltd. operated the franchise business ( exs. 87 and 88} . It was submitted on behalf of the defendant that this indicated that the Retail Food Group could probably not have afforded to continue to pay large sums of money as bonuses or otherwise to the plaintiff via Jeruk Pty. Ltd, under the system which oper~te~ in ~ 1986-87 and as apparently proposed for some time · thereafter. Mr. D'Almeida said that the franchise side of the business·was profitable and that the company went into liquidation because of. ~/ old debts previously incurred by the·Papoulias interests.· It was submitted on behalf of the plaintiff that had the plaintiff become a master franchisee, he wou_ld have generated his own income and retained his income by way of franchise fees; and royalties before he remitted to the-Retail Food Group its share of such earnings. This, of ·course, depended upon when the master franchise system would have been set up in Queensland and whether· · the plaintiff would have been appointed. The submission for the -- 72 of 84 -- 70 defen-Oant has substance with respect to the few years~following the accident. The master ~ranchise system when it was first introduced late in 1988 in Victoria and. in other States much later, involved a change in the system which had previously_ operated .. The master franchis~e 1 s role was to locate sites and to purchase existing busin.esses and convert them . to franchise sites. A master fran.chisee, and not Mr .. D 1 Almeida 1 s companies as previously, took the lease from the shopping centre developers or owners. When a master fran.chisee obtained a franchisee to purchase a shopping site,: that · franchisee became the sub-lessee to the master franchif;>ee. A_franchisee would in general pay $55,000.00 franchise fee to the ,master franchisee, plus 6 per cent of the franchisee 1 s gross turnover by way of royalty. A further sum of 2 per cent of ;hi$ turnover for marketing was paid by the franchisee. As to the $55)000~00, the master franchisee received 50 per cent and remitted 50 per cent to.Mr. D 1 Almeida 1 s organisation. As to the 6 per cent royalty, the master franchisee retained 50 per cent and 50 per cent went to Mr. D1 Almeida 1 s organisation. The 2 per cent marketing fee went directly to Mr. D 1 Almeida 1 s organisation. The master. .franchisee was required to conduct market res~~r~h to ensure that each site had every prospect of success. He was also required to assist and supervise each franchisee in the operation of~his business. This required regular visits. Each franchisee was intended to operate by a compu~er system by which their tills were linked to the computer in Mr. D1 Almeida 1 s office. However, not all franchisees were so linked. ( l -- 73 of 84 -- e ' -"---" 71 Mr. D'Almeida referred to similar chains as his competition and which he said operated on a somewhat similar basis. Mr. D' Almeida said that the master franchisees in other States did not have-the drive and enthusiasm of the plaintiff. He said that the Victorian master -franchisee will gross. approximately $400,000.00 this year and by Christmas will have approximately 50 stores under his control in Victoria. He said that the Victorian master franchisee's expenses "probably run at 30 to 40 per cent of the gross income" and that he opened new stores "probably averaged about 1 0 to 12 stores per year". There is no evidence or financial returns from the-Victorian master franchisee to substantiate the figures suggested for his earnings, or his expenditure, although there is some evidence of national gross retail sales of·all "Donut King" and "BB's Coffee and Croissant" outlets from October 1990 to September· 1991 (ex. 92) from the books of Mr. D'Almeida's organisation, -as well as evidence of total market sales and - sales fo~ each of Queensland and Victoria for the year ended 30th June-- ::J 992 (ex. 93) . A master franchisee for Queensland was not appointed until May 1991 ostensibly to take control from 1st July 1991. He·was · Mr. Cameron who gave evidence of his operation. Through him were tendered a trading, profit and los~ and balance sheets accbunts for the year ended 30th June 1992 (exs~ 95, 96). A substantial - component of the earnings of a master franchisee comes from the 50 per cent franchisee ·fee of $55,000.00 for each new store opened. This is a once off fee~ It is not paid again even if a franchisee renews his lease at the -- 74 of 84 -- 72 end·of the five year period. Future income therefore depends heavily on the. availability. of new sites and more importantly on the availability:of persons to take up a franchise and run a business, and run it successfully. Whilst there was considerable optimism as to the future availability of new franchises, and Mr. D'Almeida referred to new chains contemplated such as "Pastarinis", it was conceded that the availability of new franchises- cannot continue forever. ·There cannot be an endless supply of them and this is a matter of commonsense~ As to royalties, there· is also the ordinary exigencies of business. Royalties depend -upon the ultimate franchisee operating a successful business.. Some are mismanaged. Some get into financiaLdifficulties and are wound up. Some do not renew their-lease because of various factors. The evidence shows that there are·difficulties at times with the shopping centre owners and develbpers who try to relocate stores which is not acceptable to the franchisee. Some developers get into difficulties and that has its effect on the continuation of some stores. There is also evidence that various stores close down. In Queenslandj 9 stores closed down last year. Mr. D'Almeida said that such factors as the pilots' strike and the fact that the developers and shopping centre owners went bad.and closed shops had. serious consequences. He gave as examples, George Herscu, Kern Corporation and Barrier Reef Wonderland at Townsville. There.is also evidence that there is a limit to the number of' sto.res a master franchisee cah properly service. If the number· expands, ·the master franchisee has to engage other senior personnel and perhaps enter into a partnership arrangement of .. f ' .. -- 75 of 84 -- 73 some type. This affects net earnings, although there are some economies of scale. This also supports the conclusion that the plaintiff could operate a master franchise in the future, aided by such personnel, particularly having regard to his managerial ability and communication skills. There is also evidence that in some cases, the franchise fee is waived in order to let a particular site become viable. In such cases, neither the master franchisee·nor the Retail Food Group receive any part of the normal $55,000.00 franchise fee. In other cases, there was what Mr·. D' Almeida called a ''franchise ~ fee holiday" and a "royalty holiday", to allow master franchisees to generate enough income to become viable. It was said that in such cases the master franchisee receives the franchise fee.and the 6 per cent royalty and retains these totally for himself in such circumstances until he becomes viable. Mr .. D'Almeida said that this could endure for some time. This alone sugges,ts that master franchisees do not, at least in the early stages, earn substantial income. They must become established and have to rely on the viability of the actual store operator (the ultimate franchisee). Mr. D' Almeida said some stores do not become profitable for 12 to 15 months. When asked what percentage of stores are paying 6 per cent royalty and how many are based on the previous system.whereby royalties were not paid, Mr.· D'Almeida said he would have to check store by store to provide this information. Mr. D'Almeida said there was always a percentage of stores which were .unable · to pay a royalty where they are suffering adverse trading -- 76 of 84 -- '0 74 conditions. He also said that some new stores do not pay franchise fees. at :all. There is ~!so-evidence that a master franchisee at times purchases existing businesses and converts then to -a franchise outlet. There is no evidence of who provides the purchase moneys to the existing business operator and how it fits into the scheme of the arrangement between a master franchisee and the Retail Food-Group. ·r. accept that a master franchisee's income does not correlate precisely with the income of the Retail Food Group, that is_ Donut King Australia Pty. Ltd. (ex. 87) or BE's Coffee and Croissants Australia Pty. Ltd. (ex. 88), because of the varied arrangements which exist from State to State and with respect~to franchises operating under a different system before the introduction of the master franchise system and some of which continue :to operate. There is also the question of the· franchise fee and royalty holiday which, when it applies, means that the Retail -Food Group receives nothing of the franchise fee or royalty which remains with the master franchisee in full £or a time,· subject always to special arrangements with a particular shop owner both as to franchise fee and royalties. The evidence of Mr. Cameron, the Queensland master franchisee since May 1991, is- not entirely satisfactory. I was far from impressed with his manner and general demeanour, although some con~lusions can be drawn from his evidence. He questioned in court some aspects of his own profit--and loss and balance sheets for the year ended 30th June 1992 which had been prepared by the same firm of accountants who do the books and -- 77 of 84 -- 1; ' " \ c .I 75 financial returns for Mr. D'Almeida's group. It might be expected that they were reliable, given that Mr. Cameron ·said that all of the primary source records were delivered to those accountants to enable them to prepare these returns, and given that they had a knowledge of how the system operates. It does no appear whether he challenged them previously with the accountants. Exhibit 95 shows a very moderate net franchise income for Mr. Cameron of only $38,934.81 before tax for the year ended 30th June 1992. Mr. Cameron said that the figure·of $234,128.50 ~ franchise fee and royal ties wrongly included the sale of his Townsville business for which he received $1TO,OOO.OO. He said that his organisation took $75,000.00 in franchise fees forth~ 12 months to 30th June 1992, and that to that time, his royalties were in the order of $300.00 per week or about $15,000.00 for that year. If this is correct, his gross income would have been only about $90,000.00 and not $234~128.50 as disclosed ~n the return and from which his business expenses must be deducted~ He challenged various items of expenditure· in ex. 95 but I am riot- satisfied that he really understood the various components~ His evidence is also inconsistent with that given by Mr. D'Almeida who gave hearsay evidence of Mr. Cameron's income· and percentage thereof consumed by expenditure. This evidence cannot be·· safely reconciled. It was said for the plaintiff that Mr. Cameron was a babe in the woods, a novice 7 compared to the plaintiff pre-accident. I accept that Mr. Cameron did not appear to have a great deal of business acumen and that he did not have his pulse closely on the· -- 78 of 84 -- 76 financial affairs of his organisation. Nevertheless, his evidence, including, ex. 9 5; indicates that there are many exigencies confronting a master franchisee. Whilst it was argued that earnings can potentially be substantial, Mr. Cameron' s evidence and the evidence generally, indicates that earnings can be very-moderate. It is not possible to draw a safe inference from ex .. 93 (the sales for Queensland for the year ended 30th June 1992 of $3,000,617.00) as to what was Mr. Cameron's earnings for that year, · either gross or net after deduction of expenditure •. Whilst a positive attitude and optimism is a hallmark of persons concerned in this industry (and Mr. D'Almeida and the plaintiff are .. prime examples thereof), I find that no safe inference can be·drawn from Mr. D'Almeida's evidence as to the likely earnings of the plaintiff from the time he left the Retail Food Grqup in March 1987. The Victorian master franchisee was not palled, nor was· there any supporting accounts. Even had there ~een such evidence, there would have been difficulties in ba~ing:a comparison between that State and Queensland. So with the other States. Much of Mr. D'Almeida's evidence was based on heresay, without recourse to supporting evidence, and I find it cannot be relied upon as a safe basis for assessing the plaintiff's lost earnings to trial or in the future. Also there is no satisfactory basi~ for the conclusion that from and after 30th June 1987, the. plaintiff's earnings for each year would have · automatically increased by 11 per cent per annum. In the result, I conclude that the only satisfactory evidence on which to base an assessment of the plaintiff's loss -- 79 of 84 -- 77 of income, past and future, is that related to his emplo~merit with Woolworths as referred to earlier in these reasons. I now proceed to assess the plaintiff's da-mages under each head. PAIN SUFFERING AND LOSS OF AMENITIES The above findings and medical evidence show that the plaintiff suffered a serious injury with serious consequences to his lifestyle. He also suffered a depressive illness and a post-traumatic stress disorder which, until recently, has, alorig with his physical disabilities, seriously affected his lifestyre and his ability to make decisions. He endured mubh pain and suffering and loss of amenities and will have ·a permanent disability in his left leg for life, even after remedial surgery, in the order of approximately 20 per cent loss of function. His back has become mildly symptomatic which should b~ alleviated by built-up shoes. He has undergone surgery and other treatment and will face further surgery soon and inthe future. A substantial award is warranted. Both parties submitted a sum in the order of $85, 000.00 as appropriate. I consider that this sum is '---·· reasonable and will be included in the award. Interest has been agreed at 2 per cent on a pre-trial component of $30,000.00 for 6 years in the sum of $3,600.00. SPECIAL DAMAGES This has been agreed at $15,110.00, as well as interest on $2,494.00 of this sum at 12 per cent.for 5 years, giving a figure of $1,500.00. -- 80 of 84 -- 78. FUTURE RECURRENT EXPENSES This has been agreed in the. sum of $7,223.00. I accept Dr. Walsh's evidence that a figure of $1.,000.00 is involved for future psychiatric treatment over the next 6 months. This gives a total o~ $8,223.00.00. LOSS OF EARNINGS TO TRIAL I substantially accept the suomissions of senior counsel for t~e plaintiff based on continued employment with Woolworths, as a reasonable guide to the plaintiff's loss of income, and the submission that . the plaintiff's lost income to trial is not necessar~ly limited to those precise figures in ex. 79. I have taken into account all of the submissions and have also discounted the. sum to be awarded to some extent to allow for the ordinary ,exigencies which might have confronted the plaintiff between the date of accident and trial, and which might have ·' reduced t.o some extent his .. income over that period. In my opinion, an award of $85,000.00 is reasonable and appropriate. t Interest thereon should be calculated (as agreed) at 6 per cent for 6_ years, giving a figure of $30,600.00. FUTURE SURGERY .-· The present value of the total cost of a knee replacement is about $10,000.00. The plaintiff will need two such operations, one now and one in about 15 years time. Thereafter the probabilities. are that he will need an arthrodesis, the present cost of which is slightly less, in the order of about $7,000.00 to $8,000.00. On each occasion, the period for surgery and convalescence is in the order of 3 months. There will be a loss of income suffered by the plaintiff for the first procedure -- 81 of 84 -- 79 to be performed shortly and for the second procedure to be-- performed in about 15 years time. Senior counsel for the plaintiff submitted that at present value a sum in the order of $19,000.00 should be allowed for surgery. Senior counsel for the defendant submitted that an allowance of $25,000.00 (present value) should be made for two surgical procedures, one now and one later, including loss of income during each ·of those periods. Alternatively, he submitted '-~ that the present value of $15,000.00 should be allowed if the first operation occurred in 10 years·time and the second about .---,, 8 years thereafter, including loss of income following each procedure. The sum of $10,000.00 should be allowed for the first knee replacement which should be performed almost immediately·. For the second procedure ih about 15 years time, the present value of $10,000.00 deferred for 15 years is in the order of $4,800.00 to $5,000.00. For the third procedure (the arthrodesis)~ the present value of $8,000.00 deferred for approximately 24 years is in the order of $2,500.00. This gives a total sum in the order of $17,500.00 which will be allowed. Lost future earning capacity will be reflected under that heading. FUTURE LOST EARNING CAPACITY By reas6n of my findings as to the plaintiff's future earning capacity, it follows that the very large claims advanced on his behalf are unsustainable. However, senior counsel for the plaintiff submitted that a figure of about $25,000.00 should be allowed under this heading -- 82 of 84 -- 80 to provide for the risk that one or more of the plaintiff's knee operations during his income earning life might not be successful. I agree with this approach, but consider that the sum is inadequate. There must, first of all, be allowed a figure to cover the next 6 months during which the plaintiff should have undergone his first knee replacement and received psychiatric treatment. He will lose approximately 3 months' income during that period and will not be back to full earning capacity for about 6 months. Also, following the second replacement, and on present technology, he will lose about 3 months' income. In addition, some general allowance should be made for loss of income which might occur due to temporary disruption of his. earning capacity as a result of those two procedures. He will probably not lose income if he does eventually undergo an ' arthrodesis of the knee which will probably not occur until well into his 60s, after his working life is completed. Finally, I have not overlooked the fact that, if by some chance, he is . .. thrown.onto the general labour market, he is left with a 20 per cent permanent disability in his leg which may in a general way, affect his capacity to earn income. Three months immediate loss of net income would, on the basis of his continued employment at Woolworths, be in the order of $14,000.00 which should be allowed. This is one quarter of the adjusted net income for the year ended 30th June 1992 of $56,893.00. See Appendix 1B/1 of ex. 79, as adjusted earlier in these reasons . The present value of such a sum deferred for about 15 years would be in the order of $6,700.00 to $7,000.00, giving a total loss of income as a result of surgery and convalescence in the order of $21,000.00. ( " :>I c c -- 83 of 84 -- 81 Allowing factors for disruption of his earnings as a result of undergoing surgery, (apart from the direct loss of income flowing therefrom), for the fact that he will not be back to full earning capacity for about 6 months, and also for the risk that he may be thrown on to the general labour market in the future, a reasonable overall award for loss of future earning capacity should.be assessed in the sum of $70,000.00. In summary the award is as follows: Pain suffering loss of amenities Interest at 2 % on $30,000.00 for 6 years Special damages Interest on $2,494.00 at 12% for 5 years Future recurrent expenses Lost earnings to trial Interest at 6% for 6 years Future surgery Future lost earning capacity TOTAL $85,000.00 $3,600.00 $15,110.00 $1,500.00 $8,223.00 $85,000.00 $30,600.00 $17,500.00 $70,000.00 $316,533.00 -- 84 of 84 --