Haines v Bendall

(1991) 172 CLR 60

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(Judgment by: Brennan J.)

Haines
v Bendall

Court:

Judges: Mason CJ; Dawson J; Toohey J; Gaudron J.

Brennan JDeane J
McHugh J

Hearing date: February 6, 7; May 1 1991
Judgment date: 1 May 1991

SYDNEY

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Judgment by:
Brennan J.

I am in agreement with the judgment of the majority in their statement of the measure of damages in tort and with the conclusion that the appeal must be allowed, but in reaching this conclusion I do not find it necessary to attribute to the $49,037 paid to the respondent under s.16 of the Workers' Compensation Act 1926 (N.S.W.) ("the Act") - the then existing legislation - a more particular character than a payment "by way of compensation for" the injury received. Payments under the table of injuries are so described in s.16. Payments under the table of injuries can be distinguished from payments made under other provisions of the Act, but it is sufficient that they be identified as subventions to which an injured worker is entitled by reason of his having received an injury. Prima facie, an injured worker who avails himself of his entitlement to a payment under s.16 cannot establish or calculate his damages against a tortfeasor who inflicted the injury on the footing that the worker did not avail himself of that entitlement, but the prima facie rule does not apply when the intention of the provider of the subvention - here, the legislature - is that the injured worker shall enjoy the subvention in addition to and not in diminution of his claim for damages: The National Insurance Co. of New Zealand Ltd. v. Espagne (1961) 105 CLR 569 , at pp 573, 599-600; Redding v. Lee (1983) 151 CLR 117 , at pp 124-125, 135-137, 162.

2. Section 63(5) provides that a payment by way of compensation is "a defence" pro tanto to proceedings against the employer brought independently of the Act "in respect of the injury". Section 64 expressly provides for refunding compensation paid out of damages recovered against a third party (sub-s.(1)(a)) or for a diminution in damages corresponding with the amount of any indemnity paid by the third party to the employer in respect of compensation paid (sub-s.(1)(c)). The Act reveals no intention that payments under the Act should be enjoyed in addition to the damages to which, apart from compensation under the Act, an injured worker is entitled. The prima facie rule is not displaced. The compensation paid under s.16 was enjoyed from the time of its payment to the respondent until he became liable to refund it on the recovery of his damages. From that time, he has not been out of pocket for that amount. There is no warrant for an award of interest on so much of the damages awarded as is equal to the amount of $49,037 paid as compensation under s.16. The principle is the same as that applied in Batchelor v. Burke (1981) 148 CLR 448 .

3. The appellant attacks the award of interest on the sum of $75,000 which the learned trial judge awarded in respect of damages under all heads save loss of earning capacity up to the date of judgment. Interest on that sum was included in the global award of $750,000. In determining whether a pre-trial receipt of compensation affects the award (or the calculation of an award) of interest to be included in an award of damages, it is not necessary that the factors which are taken into account in assessing under a particular head an interest- bearing amount be the same or substantially the same factors as those which the legislature took into account in enacting the relevant provisions of the Workers' Compensation Act. If the payment made under the statute were shown to be a payment in respect of matters for which an award of damages gives no compensation, the prima facie inference would be that the legislature intended the payment to be enjoyed in addition to and not in diminution of the award of damages. But a payment under the table of injuries is not a payment of that kind.

4. When a payment of compensation is in respect of matters for which an award of damages gives compensation, the court will decline to award interest on amounts which would otherwise bear interest to the extent of the compensation payments received and if, in order to calculate the interest correctly, it be necessary to allocate the compensation payments between or among two or more interest-bearing amounts, the court must do the best it can in matching up the compensation payment and the relevant heads of damage. But the refusal of interest on any amount is not conditional on substantial identity between the factors related to the payment of compensation and the factors related to an assessment of damages under a particular head. Provided the compensation payment can be truly described as a compensation for the injury or its consequences to the worker, the award of damages in respect of that injury and its consequences must not contain an amount for interest on an amount corresponding with the amount of the compensation payment for the period after its receipt.

5. In the present case, the relevant sum of interest is $52,800 calculated at 8% per annum on pre-trial non-economic loss assessed at $75,000 from the date of injury to trial. No attack was made on any factor in the calculation and it is therefore unnecessary to consider the correctness of the calculation except in so far as it did not allow for the payment of $49,037 compensation under the table of injuries on 12 April 1985. Allowing for that payment, the relevant sum of interest should be reduced to $39,404.26.

6. I would allow the appeal, vary the judgment of the Court of Appeal by setting aside the order dismissing the appellant's appeal to that court and in lieu thereof order that the appeal to that court be allowed, the judgment of Carruthers J. be varied by substituting for the sum of $750,000 therein mentioned the sum of $736,604.26. By agreement of the parties, the orders for costs in the courts below should stand and no order should be made for costs in this Court.