CLA: gratuitous care – “egg-shell skull rule” & evidentiary basis to assess care

McQuitty v Midgley & Anor [2016] QSC 36

Jackson J:

The plaintiff sustained multiple injuries, including a brain injury, as a result of a car accident in August 2003. Prior to the plaintiff’s injury, he suffered from a personality disorder and regularly engaged in ‘significant antisocial behaviour’. This behaviour continued after he had physically recuperated from the injuries he sustained in the car accident.

The “egg-shell skull rule” determines that the defendant must take the plaintiff as they find them. However, the damages award will be reduced by the percentage likelihood of the plaintiff’s pre-existing condition resulting in the same outcome after injury as per Malec v JC Hutton Pty Ltd (1990) 169 CLR 638; (1990) 93 ALR 545. In  issue was whether the plaintiff would still have required care, even without having sustained a brain injury?

General Damages

Jackson J held that the plaintiff’s condition  fell within item 7 of Sch 4, as a “moderate brain injury”. Jackson J came to this conclusion as the evidence did not suggested that the plaintiff suffered a marked impairment of intellect as a result of the injury. Therefore, Jackson J held that the plaintiff’s brain injury should be assessed at an ISV of 50. Jackson J increased (uplifted)  the ISV by 20% due the plaintiffs multiple injuries –  ISV of 60 ( $121,400).

Section 7 of Sch 3 of the Civil Liability Regulation 2003 (Qld) (“Regulation”) provides that in considering the impact of the aggravation of the pre-existing condition, the court may have regard only to the extent to which the pre-existing condition has been made worse by the injury. Therefore, the Regulation  requires the separation of the effects of the injury from the pre-existing condition in reaching the ISV.

Jackson J held that there was no doubt that the plaintiff had impaired prospects in life due to his pre-injury personality. The plaintiff had a poor employment history and academic record, a history of low-level criminal activity and displayed distinct anti-social behaviours. However, Jackson J was not persuaded that, within the meaning of s 7, the plaintiff had a pre-existing condition in the nature of his acquired brain injury. Therefore, Jackson J did not deduct any part of the assessed ISV for a pre-existing condition.

Gratuitous Services

Medical assessments of the plaintiff did show a pattern of deficit in attention, memory and executive function that was consistent with an acquired brain injury. The problems the plaintiff experienced pre-injury were exacerbated by the brain injury and his ability to cope with or voluntarily address those problems was further compromised. Jackson J accepted that the impairment the plaintiff suffered as result of his injury was a loss of the capacity for voluntary change, or some of that capacity.

Jackson J noted that there is a distinction between the amount of care needed by the plaintiff and the amount of care he had actually received, as it is only the plaintiff’s need for which compensation is allowed. This was difficult to determine as there was a lack of precise evidence and differing professional opinions. The determination of care received was further complicated as the plaintiff had many different living arrangements and carers over the years.

Additionally there were unreliable witnesses. One witness claimed to have cared for the plaintiff for more hours than was possible in a week. Consistent medical documentation of the plaintiff’s anger issues did not correspond with witness accounts of the plaintiff’s pre-injury behaviour.

There were several differing expert witnesses and medical experts opinions put forward. One assessment recommended that the plaintiff required at least 10 hours of care per day, but preferably twenty-four hour care. Another assessment recommended that the plaintiff only needed two hours care per day.  Jackson J reached the conclusion that the claim for gratuitous services should be assessed on the basis of average need of 6.5 hours per day for past gratuitous services. This figure included care to assist the plaintiff when interacting in the community, namely to avoid getting into confrontations due to his anger issues.

There was some dispute as to whether the requirement in s.59 of the Civil Liability Act 2003 required the threshold to be for 6 hours per week over 6 months and actually incurred. Jackson J found that it can include services to be provided:

“[211] In my view, it is not a requirement that the services in fact provided are equal in extent to the need for care for which compensation is awarded where the period is a past period. Section 59(1) is cast in a mix of tenses. The damages are to be for relevant services “provided”. But the services include services include those that “are provided” and those “to be provided”. The minimum threshold requirement is of six hours per week for at least six months. But that threshold could operate in relation to services that have not yet been provided.

[212] Having regard to what was said in Kriz v King set out previously, in my view, and subject to the operation of the minimum threshold requirement, the proper construction of s 59(1) is that it does not require that an order for damages can only be made for the services actually supplied as opposed to the need for those services.”

The period of past loss was calculated from the date the plaintiff was discharged from hospital on the 16th October 2003 up to date of the trial. Past gratuitous services were calculated at $1,049,412.

As to future gratuitous services, his Honour noted the divergence in authority as to the use of commercial rates and whether they included agency fees: Waller v Suncorp Metway Insurance Ltd and applied a commercial rate inclusive of the agency fee:

“[217] The rates claimed by the plaintiff were based on the full cost of acquiring the services from a commercial agency who would provide those services. In putting it that way, the plaintiff’s claim is counterfactual. The plaintiff and his financial guardians do not in fact propose that is what the plaintiff will do. On the contrary, the plaintiff’s aim, with their agreement, is to acquire a house with the lump sum award and to live in that house with Mr Horsley, who is apparently prepared to do so, continuing their friendship and prior companionship as well as resulting in the plaintiff receiving Mr Horsley’s care.

[218] But that is, of course, only the present plan. Plans do not always work out. And the plaintiff is to be compensated for his need for care, not just for the fact of the gratuitous services supplied or to be supplied to him.

[219] That view follows from Van Gervan v Fenton[31] and Grincelis v House.[32]

[220] In Van Gervan, a wife who had been employed as a nurse’s aide gave up her employment to care for her husband who was in need of those services because of a brain injury that caused the husband to be unable to manage his affairs hour by hour because of his short term memory loss. She provided the services gratuitously. The court below held that the husband’s entitlement to compensation for the need for the services, represented by the value of those services provided by the wife, should be valued by the sum that would have been paid to the wife for the employment she gave up as a nurse’s aide.

[221] The majority of the High Court rejected that approach and said:

“Contrary to the judgments [below]… the wages forgone by a care provider are not an appropriate criterion for determining the value of services provided gratuitously to an injured person. As a general rule, the market cost or value of those services is the fair and reasonable value of such services…

Once it is recognized that it is the need for the services which gives the plaintiff the right to an award of damages, it follows that the damages which he or she receives are not determined by reference to the actual cost to the plaintiff of having them provided or by reference to the income forgone by the provider of the services.”[33]

[222] In Grincelis, the plaintiff suffered acute brain damage and was cared for by his parents. The question before the High Court was whether statutory interest was recoverable on an award of damages for past gratuitous services. However the court said:

“In Van Gervan v Fenton, it was held that the true basis of a claim for damages with respect to care or services provided gratuitously to a person who has suffered personal injury is the need of the plaintiff for those services, not the actual financial loss suffered as a result of their provision. Accordingly, it was held in that case that a plaintiff’s damages on this account are not to be determined by reference to the actual cost to the plaintiff of having the care or services provided, or by reference to the income foregone by the provider of the services, but, generally, by reference to the market cost of providing them. Neither party sought to reopen the decision in Van Gervan.”[34] (footnotes omitted)

[223] The defendant sought to avoid the full commercial cost approach by relying on the remuneration that a person who might be employed by a commercial agency to supply the services would earn, as opposed to the rate that the agency would charge.

[224] The defendant relied on Waller v Suncorp Metway Insurance Ltd,[35] as supporting that approach. In that case, the plaintiff suffered severe brain damage and was left unemployable and in need of constant care. He could barely communicate and was ambulatory only with assistance. The primary Judge allowed damages by reference to an hourly rate for a permanent employee as opposed to a casual rate.

[225] Chesterman JA said:

“There is, I think, a fallacy in the submission, which is that it equates ‘the agency rate’ per hour of providing a carer with the cost of hiring a carer. The appellant urges the Court to adopt what would be in practice an arbitrary rule. In those cases in which a plaintiff, by reason of his injuries, cannot himself engage the carers he needs the market cost of providing the services will be that which an employment agency would charge; in other cases where a plaintiff can engage the carers the market cost will be the amount paid to the carers. Such a basis for distinction is not, I think, realistic and is too inflexible to allow for assessments to be made in particular cases. It is unrealistic because the appellant is incapable of engaging carers on either basis, either by himself or by engaging an employment agency to provide him with carers. Both tasks must be performed by someone on his behalf. If that person can reasonably engage carers directly and so avoid the ‘agency fee’ there is no reason I can see in fact or principle why damages should be assessed by reference to the higher rate.”[36]

[226] It is difficult to avoid the conclusion that there is some tension between the High Court cases and Waller. The difficulty is caused by mixing the actual scenario with the hypothetical scenario. The actual scenario in these cases is that the services are being provided by a family member gratuitously. The hypothetical scenario is that compensation for the need for the services is to be assessed by reference to their market value. If the market is one in which some participants can get a better price than others, it seems reasonable to say that may be taken into account in assessing overall value. But it does not seem particularly attractive to say that if one plaintiff (who is not in fact going into the market to acquire the services) might be able to get a better price if they did go into the market than some other plaintiff (who also is not in fact going into the market to acquire the services) the assessment of market value should reflect that possibility. To do so moves away from the hypothesis of compensating a plaintiff for a loss which is a need for the services by assessing the value of the services, irrespective of whether they are in fact supplied or paid for.

[227] What seems to be causing the problem is the proposition that if the particular plaintiff went into the market to acquire the services they may be able to get a better price than the commercial short term rate. As a matter of logic about value in a market, there is no objection to evidence about that value from more than one possible source of supply. But, in my view, the hypothetical market value of the services that represents the need being compensated as the loss in a case like the present should not turn ordinarily on a particular plaintiff showing how they would price the services if they engaged in the counterfactual hypothesis or a defendant pointing to the possibility that the plaintiff could pursue such an alternative.

[228] Alternatively, the plaintiff submitted in the present case that there was no evidence to show that the services would be available to the plaintiff on a commercial basis at Woodford for the cost of employing someone directly as opposed to retaining an agency to supply the services. It is true that there was no evidence to support the conclusion that the services would be available on a commercial basis for the cost of employing someone as a carer.

[229] The conclusion I have reached is that the appropriate basis for the assessment is the commercial cost of an agency supplied carer. (underlining added)

[230] The evidence of the agency rate for the hourly values of the services over the relevant periods for past care is provided in the following table. These figures have been derived by adapting from the weekly costs set out in a quote from “Quality Lifestyle Support”, which was an exhibit tendered at the trial. The comparison between those rates and the rates claimed by the plaintiff is as follows:

Period Hourly rate proved Hourly rate claimed
2003 $29.15 $26.00
2004 $29.71 $26.50
2005 $32.51 $29.00
2006 $33.52 $29.90
2007 $35.45 $30.90
2008 $36.70 $31.85
2009 $38.00 $33.00
2010 $40.44 $35.00
2011 $46.79 $40.50
2012 $47.26 $40.90
2013 $49.62 $42.95
2014 $51.13 $44.25
2015 No value $44.25

[231] To the extent that the proved rates exceeded the claimed rates I will adopt the claimed rates. The plaintiff gave no notice of intention to amend the claimed rates”

As to contingencies, Jackson J reasoned among the matters to be considered was that it would be unlikely that the plaintiff would still need a carer to help the plaintiff avoid confrontations in the community when the plaintiff became elderly. His Honour held that adopting a global discount of 20% was appropriate. This reduced the total of future gratuitous services to $1,548,688.05.

There was no claim for loss of earnings or lost earning capacity.

Total damages:

 

General damages $121,400.00
Past gratuitous services $1,049,412.00
Future gratuitous services $1,548,688.05
Total $2,719,500.05

The plaintiff was 20 years old at the time of the injury in August 2003.

David Cormack – Brisbane Barrister & Mediator

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