Court of Appeal: Injuries award increased after trial judge applied erroneous 40 per cent deduction for future loss of earnings

About this case:

• Citation:
  [2022] IECA 134
• Judgment:
  External link
• Court:
  Court of Appeal
• Judge:
  Mr Justice Seamus Noonan

It was held that the trial judge had reduced the award based on speculation as to the future of the retail market in which the plaintiff worked and did not hear any evidence on the subject. Further, the defendant’s appeal that the trial judge failed to give reasons for certain special damages was rejected.

Background

The plaintiff issued personal injuries proceedings against the defendants after a steel girder fell on her leg while she was at work. She suffered a 25-centimetre laceration to her right calf. She claimed to have suffered from severe and ongoing pain arising from the laceration, which limited her ability to work.

Liability was admitted and the case proceeded as an assessment-only. The primary issues in the case were the plaintiff’s post-accident employment history and the source of her pain.

The plaintiff had resigned from her job with the defendants in October 2015 and was employed in several other retail outlets, including supermarkets, a petrol station and a pharmacist. The plaintiff claimed that she struggled to cope working full time in these roles due to the pain from her injury and her hours were eventually reduced to a three-day week in her current employment.

The plaintiff provided evidence from her GP and a consultant plastic and reconstructive surgeon. These doctors stated that the plaintiff’s injury caused her real struggle despite the fact that she pushed herself very hard. The consultant stated that the plaintiff had an injury consistent with an underlying cutaneous nerve issue and that improvement had been static.

The defendants’ medical experts took a different view, with their plastic surgeon stating that the injuries were likely psychological in nature. It was said that there was no evidence of physical injury which caused the pain.

The plaintiff also produced evidence from an actuary, who calculated her future loss of earnings from her reduced hours at €115,000.

The trial judge held that the plaintiff was a truthful witness who did not exaggerate her injury. It was held that the plaintiff’s complaint of pain was genuine and that, having regard to the medical evidence, the pain was probably caused by a nerve issue.

It was held that the plaintiff would not have been happy with a sedentary employment option as contended by the defendant and went on to consider damages. The court determined that it would apply a 40 per cent reduction to the plaintiff’s future loss of earnings, stating that online shopping and the general downturn in retail stores could seriously affect her employment in the future.

The court also awarded €80,000 in general damages. The court also assessed special damages at approximately €40,000, which related to periods between May 2015 to date regarding loss of earnings

The defendants appealed the loss of earnings and future loss of earnings awards by the trial judge. The fundamental complaint was that the trial judge failed to give sufficient reasons for these conclusions and that the judge did not have adequate regard to the defendants’ evidence on alternative sedentary work.

The plaintiff also cross-appealed on the Reddy v. Bates reduction applied by the trial judge, arguing that it was too high and based on speculation.

Court of Appeal

Delivering judgment in the case, Mr Justice Seamus Noonan began by considering the defendants’ appeal. It was noted that the starting point for any appellate court was Hay v. O’Grady [1992] IR 210, which had been developed by more recent cases such as Doyle v. Banville [2012] IR 505 and Donegal Investment Group plc v. Danbywiske & Ors. [2017] IESC 14.

The court stated that the degree of analysis required by a trial judge was entirely case-dependent, with simple cases requiring “only basic elucidation of reasons” and with complex cases perhaps requiring more. Even absent explicit reasoning, it is possible to infer why a particular outcome was reached in many cases (see McCormack v. Timlin & Ors. [2021] IECA 96). Appellant courts should not encourage “rummaging in the undergrowth” of evidence where the overall rationale was clear.

It was noted that trial courts were expected to operate efficiently and in a cost-effective manner, which would be negated if they were required to “parse and analyse every minute piece of evidence.” Further, appellate courts were entitled to assume that a trial judge had taken account of all evidence when reaching a decision, whether expressly stated or not.

Applying the law to the case, it was held that the trial judge had clearly accepted the plaintiff’s evidence about her ability to work and her efforts to return to normal life. No medical witness suggested that the plaintiff’s pain was not genuine. The trial judge resolved the dispute as to the source of the pain and gave reasons for the decision, the court held.

Mr Justice Noonan also noted that the trial judge had considered the expert evidence that the plaintiff’s difficulties were psychological and had held that any psychological injury was at the lower end of the scale.

The court rejected the submission that the trial judge erred by failing to have regard to the evidence of the defendants’ consultant orthopaedic surgeon. The court commented that it was not clear why this evidence was relevant given the plaintiff’s injury and it was therefore unsurprising that the trial judge primarily considered the evidence of the plastic surgeons.

It was implicit in the court’s decision that the orthopaedic surgeon’s evidence had been rejected and as such there was no failure by the court in this regard. Further, while the trial judge did not consider the evidence relating to alternative sedentary employment in depth, the trial judge was entitled to hold that the plaintiff would not have been content with sedentary employment based on the evidence.

Reddy v. Bates Deduction

Next, the court considered if the trial judge was correct to apply a 40 per cent reduction to the future loss of earnings. It was noted that such deductions were “far from straightforward” and that there were many potential intervening reasons for why a person might not work to the age of retirement.

As such, allowances had to be made for the exigencies of life in general, such as marriage status, unemployment and illness (Walsh v. Tesco Ireland Limited [2017] IECA 64). The court noted that there was a futility in attempting to predict general economic circumstances beyond the short term.

Other issues for consideration included a plaintiff’s track record of employment and the security of any employment at the date of trial. In general, it was “somewhat difficult to envisage cases where no Reddy v. Bates deduction is appropriate.”

An analysis of the jurisprudence suggested the spectrum for deductions was between 15 and 25 per cent. This was a range that had been adopted by the courts and had become “firmly embedded in convention and practice.”

The deduction in this case was therefore “significantly outside the range” of deductions usually provided by the courts. Further, the court speculated on the state of the shopping retail market without any evidence to justify those assertions. The judge therefore fell into error.

Conclusion

The court substituted a 15 per cent reduction in the plaintiff’s future loss of earnings, which increased her award by €28,000. The defendants’ appeal was dismissed. As such, the plaintiff was awarded €218,175.

Twomey v. Jeral Limited and Ors. [2022] IECA 134