SUPREME COURT of SOUTH AUSTRALIA (Full Court)
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SUPREME COURT OF SOUTH AUSTRALIA (Full Court) AMACA PTY LTD v WERFEL [2020] SASCFC 125 Judgment of The Full Court (The Honourable Chief Justice Kourakis, The Honourable Justice Nicholson and The Honourable Justice Livesey) 21 December 2020 TORTS - NEGLIGENCE - ESSENTIALS OF ACTION FOR NEGLIGENCE - DUTY OF CARE - REASONABLE FORESEEABILITY OF DAMAGE - PARTICULAR CASES - DANGEROUS THINGS OR SUBSTANCES APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - INTERFERENCE WITH JUDGE'S FINDINGS OF FACT - FUNCTIONS OF APPELLATE COURT - FINDINGS ON ISSUE OF NEGLIGENCE - GENERALLY APPEAL AND NEW TRIAL - APPEAL - GENERAL PRINCIPLES - RIGHT OF APPEAL - WHEN APPEAL LIES - ERROR OF LAW - PARTICULAR CASES INVOLVING ERROR OF LAW - FAILURE TO GIVE REASONS FOR DECISION - ADEQUACY OF REASONS The respondent plaintiff was exposed to asbestos from products manufactured by the appellant, James Hardie, whilst employed by fencing contractors retained by the South Australian Housing Trust between 1994 and 1997. The plaintiff was again exposed to asbestos when undertaking domestic renovations in 2000 and 2001 on his home at Pooraka, and again in 2004 when working on his home at Parafield Gardens. These products had been manufactured by James Hardie, and sold to and installed by others, many years before the plaintiff worked on them. The plaintiff was diagnosed with a rare form of mesothelioma in August 2017, when he was just 40 years old. The plaintiff's mesothelioma was, for the purposes of the law of negligence, caused by his exposure to products manufactured by James Hardie. The On Appeal from SOUTH AUSTRALIAN EMPLOYMENT TRIBUNAL (HER HONOUR DEPUTY PRESIDENT JUDGE FARRELL) [2019] SAET 159 Appellant: AMACA PTY LTD Counsel: MR G WATSON SC WITH MR M J HOOPER AND MR T BESANKO - Solicitor: HOLMAN WEBB LAWYERS Respondent: MATHEW HARRISON WERFEL Counsel: MR P SEMMLER QC WITH MR S TZOUGANATOS AND MS A HOFFMAN - Solicitor: TURNER FREEMAN Hearing Date/s: 06/02/2020 to 07/02/2020, 10/02/2020 File No/s: SCCIV-19-1036 A 2 plaintiff is now 44 years old and, based on evidence accepted by the trial Judge, has a life expectancy of a little more than two years, rather than the statistical average of in excess of 40 years. At first instance, the trial Judge found James Hardie negligent and awarded damages of just over $3 million in the plaintiff's favour. James Hardie appealed to this Court, complaining that the trial Judge’s reasons were inadequate and that, in any event, the trial Judge should not have found that it owed the plaintiff a relevant duty of care, that it breached that duty of care, and nor that any breach caused the plaintiff's injury. James Hardie also complained that the assessment of damages was affected by error or manifestly excessive, particularly the assessment of $400,000 for non-economic loss, the assessment of Griffiths v Kerkemeyer damages, the assessment of Sullivan v Gordon damages, and the assessment of exemplary damages. Held by the Court: allowing the appeal, but only to the extent of reducing the total damages award to $2,228,478. Adequacy of Reasons 1. The provision of adequate reasons is an essential aspect of the judicial function and the failure to provide them is inimical to the open and transparent resolution of litigation. 2. It is most unwise to engage in wholesale copying of submissions without attribution. Whether the judicial function of furnishing adequate reasons has been satisfied is not determined by a mechanical assessment of what has, or has not, been copied, but by whether the reasons nevertheless perform their essential function. 3. The inadequacy of reasons will not vitiate the decision unless the inadequacy relates to material aspects of the case, being issues on which the parties were divided, the resolution of which affected the outcome. 4. The trial Judge made no attempt to engage with the case made by James Hardie on a number of issues in contest on appeal and, in numerous respects, the reasons were inadequate. Duty of Care 5. The combined circumstances required the imposition of a duty on James Hardie to take care to avoid injury to persons who might occasionally remodel, repair or remove its asbestos-cement products. 6. At least by 1980 James Hardie ought to have known that there was a material risk of contracting mesothelioma from the occasional exposure to asbestos dust which would arise from tradespeople and householders remodelling, repairing or removing asbestos-cement products in residential buildings. 7. By 1990 there was strong evidence that there was a material risk of contracting mesothelioma from even occasional exposure to asbestos dust when working with asbestos- cement products of which James Hardie, acting reasonably, would have known, which, together with other salient circumstances placed James Hardie under a duty of care. 8. Defined, as the duty must be, prospectively, the class to whom the duty to take reasonable care is owed is those existing or future occupiers of homes containing asbestos- cement building products who may come to remove, remodel or repair those products, and the tradespersons they might engage to do so. Causation 3 9. The plaintiff would have become aware of the risk that exposure to dust from asbestos-cement products might cause mesothelioma from at least the time he worked for a fencing contractor if James Hardie had more actively and strongly warned of the danger from 1990. 10. The plaintiff would have acted on those warnings and he would not have contracted mesothelioma. The plaintiff's employment as a workplace safety representative strongly supports the inference that he would have taken recommended precautions. Damages Pain and suffering and loss of amenities 11. When determining an award of damages for pain and suffering and loss of amenities interstate authorities are not irrelevant, but primary emphasis must be given to awards made in this State. The trial Judge erred in giving primary emphasis to an award made in the New South Wales Dust Diseases Tribunal. 12. Differences between damages awards for pain and suffering in South Australia and interstate must be addressed incrementally, with the benefit of whatever submissions and materials the parties and their representatives choose to put before this Court. 13. Where a plaintiff knows that life expectancy has been curtailed, the consequential anguish and pain must be reflected in the award made for general damages for pain and suffering and the loss of the amenities of life. 14. The award of $400,000 made by the primary judge for general damages and loss of amenities was affected by error and was manifestly excessive. It must be set aside. The appropriate award is $280,000, with interest on past loss at a rate of 4 per cent. Loss of expectation of life 15. The award compensates for something which is incalculable, being the “objective” aspects of life having been shortened. There is no authority in this Court or the High Court which supports the approach taken by the trial Judge of awarding damages for loss of expectation of life at a rate of $1,000 for each of the “lost years”. 16. The sum of $40,000 awarded by the trial Judge was made on an incorrect basis and represents a great deal more than is usually awarded for this head of damage in this State. The award should be set aside. On reassessment, the award should be a conventional sum of $20,000. Griffiths v Kerkemeyer damages 17. By simply repeating the plaintiff’s submissions, based on contested expert evidence, the Judge did not engage with the issues presented to her for decision. In addition, no attempt was made to reconcile the differences between the evidence led from the plaintiff and his wife and the assumptions made in the expert evidence of the occupational therapist. 18. In addition, the Judge did not make adequate findings addressing agency and award rates. On the evidence, the average award rate of $20 per hour was appropriate given the plaintiff’s capacity to retain carers, and the unskilled nature of the services, at least until after remission and the recurrence of illness until the end of life, when professional care at agency rates was appropriate. 19. Damages awarded under the Griffiths v Kerkemeyer principle are intended to compensate a plaintiff for the care and services gratuitously provided to the plaintiff personally, whereas damages awarded under the Sullivan v Gordon extension to the Griffiths v Kerkemeyer principle, at least as reflected in s 9(3) of the Dust Diseases Act 4 2005 (SA), are intended to compensate for a plaintiff’s impaired capacity to provide gratuitous domestic services to members of the plaintiff’s household. This distinction was not reflected in the evidence or the findings. There was a failure to provide adequate reasons. 20. The Judge erred in awarding Griffith v Kerkemeyer damages for unspecified services provided to the plaintiff by his wife in connection with all of the plaintiff’s hospitalisation and treatment. However, in accordance with Wilson v McLeay, some moderate allowance would be made in addition to the cost of travel. 21. Accordingly, the award must be set aside and the damages reassessed. On reassessment, the award for gratuitous services provided to the plaintiff in the first two years after diagnosis will be $25,000 in lieu of the trial Judge’s allowance of $92,413.05, plus interest on past loss at a commercial rate of 6.5 per cent. 22. The award for the future gratuitous services to be provided to the plaintiff in the three years until likely death is $125,000 in lieu of the trial Judge’s allowance of $187,862. Sullivan v Gordon damages 23. The occupational therapist’s calculations were based on her assessment of what services could or should have been provided to the household rather than on the evidence of the plaintiff and his wife about the domestic services the plaintiff in fact provided to his family before illness and during remission.