Punitive damages – some reason at last

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Punitive Damages and Aggravated Damages
The first basic principle requires that a distinction be recognised between the term damage and damages. As with income loss, in determining the amount to be awarded, it is often necessary to take account of future requirements for treatment, particularly in the case of orthopaedic injuries that may involve ongoing degeneration and the need for surgery for fusion or replacement of joints. In respect of the first Gore guidepost, the majority acknowledged that conduct by State Farm Insurance was reprehensible enough to warrant a punitive damages award, but was not convinced the State's objectives could not have been satisfied by a more modest punishment. More from this Author. Both branches of the law being addressed in large parts to same type of conduct, the modern separation of their different purposes and procedures was still being completed at that time.

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12. Remedies and Costs

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By using our website you agree to our use of cookies in accordance with our cookie policy. Are you liable for aggravated damages in privacy actions? Background Freelancer is a large online freelancing marketplace where employers post work they need to be done and freelancers offer quotes to complete the project.

General damages In coming to his award of general damages for non-economic loss, the Privacy Commissioner considered: Aggravated damages Following his award of general damages, the Privacy Commissioner examined whether he should make an award for aggravated and punitive damages.

He then restated the guiding principles set down in 'BO' v AeroCare Pty Ltd [] AlCmr 32 to determine whether or not an award for aggravated damages is warranted: Did the defendant behave "high-handedly, maliciously, insultingly or oppressively"? Did the manner in which a defendant conducted their case exacerbate the hurt and injury suffered by the plaintiff? In considering these principles, it was noted that the Macquarie Dictionary defines: Freelancer's conduct in improperly disclosing HW's personal information was aggravated by its apparent disregard for his privacy and its own privacy obligations, as it continued to publish HW's information online despite being made aware it breached privacy legislation and was contrary to its own privacy policy the manner in which Freelancer conducted itself highlighted Freelancer's apparent contempt of, or at best, indifference to HW's complaints about its interference with his privacy.

What this means for agencies This decision demonstrates that going forward the Privacy Commissioner will award aggravated damages where it is appropriate to do so.

Do you have a Question or Comment? Interested in the next Webinar on this Topic? Click here to register your Interest. Ashley Cahif formerly with Sparke Helmore Lawyers.

Events from this Firm. More from this Firm. More from this Author. News About this Firm. The proposed legislation has been released for public comment, and may be altered depending on submissions received.

What are the key features? The CDR scheme is significant because it imposes additional privacy and data sharing obligations on regulated entities. New Australian mandatory data breach laws. Companies must now notify individuals and the Government of data breaches that cause personal information to be compromised. The new privacy laws. Transfer of data by Australian organisations to other jurisdictions is increasingly common. Change to European privacy laws and its impact on Australian businesses.

Establishing a right to privacy in Australia: What would it look like and how would it work? Why we are really worried about My Health Record. What is personal information and why does it matter? Energy and Natural Resources. Food, Drugs, Healthcare, Life Sciences. The plaintiff when recovering common law damages is required to repay to the workers compensation insurer the gross amount of weekly payments received. In many cases where liability is not in issue, the insurer will pay for or reimburse out-of-pocket expenses that meet these requirements.

Payment of these expenses is commonly raised as a defence to a claim. In general, claims for out-of-pocket expenses centre on needs for treatment, past and future, rehabilitation and aids to assist a plaintiff in overcoming disability arising from injury. As with income loss, in determining the amount to be awarded, it is often necessary to take account of future requirements for treatment, particularly in the case of orthopaedic injuries that may involve ongoing degeneration and the need for surgery for fusion or replacement of joints.

In addition, allowance may be made for the cost of providing special beds, tools or equipment designed to assist an impaired plaintiff in the functions of everyday living. Thus, the cost of repair or replacement of these items is compensable. Other items held to be compensable include clothing damaged in the course of the accident or treatment. As to the Motor Accident Injuries Act , see [ ]. The plaintiff claimed the considerable cost of a C-leg prosthesis, a specialised computerised device.

He explained that he did not, prior to trial, use his conventional prosthesis regularly or for extended periods because it caused him pain.

The evidence established that prior to his accident, the plaintiff suffered from symptoms of osteoarthritis and it was inevitable that he would at some stage require hip replacement that could have been undertaken in a public hospital at no expense to him.

The Court of Appeal accepted that the replacement that would have been required as a result of the pre-accident progressive condition was unlikely to involve the urgent intervention necessitated by the injury suffered in the accident.

Accordingly the plaintiff was entitled to recover the cost. The capital costs of modifications to accommodation to meet the needs of a disabled plaintiff are recognised as recoverable out-of-pocket expenses and no allowance is to be made for the increase in the capital value of a property modified for that purpose: In most cases, the cost of the basic accommodation itself is not recoverable.

In Weideck , the injured plaintiff could no longer live in the caravan he occupied prior to his injury. He was allowed the full capital costs of modifications required to deal with his disability. In addition, he was allowed the costs of land and a basic house, heavily discounted to set off the rent he otherwise would have continued to pay and the income that ordinarily would have been diverted to the provision of a capital asset, such as a house.

In such circumstances, the additional costs of rearing and maintaining the child are recoverable. There are two varieties of attendant care: The issue that has been most productive of judicial and legislative scrutiny is that arising out of claims for services provided on a gratuitous basis. The argument was that the loss was in truth suffered by the person who provided the services.

The character of the benefit that the plaintiff received by the gratuitous provision of services was such that it ought to be brought to the account of the wrongdoer. The fact that a relative or stranger to the proceedings is or may be prepared to provide the services gratuitously is not a circumstance which accrues to the advantage of the appellant.

If a relative or stranger moved by charity or goodwill towards the respondent does him a favour as a disabled person then it is only right that the respondent should reap the benefit rather than the wrongdoer whose negligence has occasioned the need for the nursing service to be provided. The plaintiff might, or might not, reimburse the provider. According to the repeated authority of this Court, contractual or other legal liability apart, whether the plaintiff actually reimburses the provider is entirely a matter between the injured plaintiff and the provider.

It is, as has been repeatedly stated, to provide the injured plaintiff with damages as compensation for his or her need, as established by the evidence. The anomaly arose from the departure from the general rule that damages, other than damages for loss not measurable in money, were not recoverable unless the injury involved resulted in actual financial loss.

The controversy arose because the result could be disproportionately large awards when compared to sums payable under traditional heads of damage. He also accepted that in appropriate circumstances a deduction for vicissitudes might be appropriate when assessing a claim for attendant care costs.

There are some substantial differences between these provisions. Sackville AJA held that only one six-month qualifying period was involved and it was not a continuing requirement. The result was that compensation was payable for services provided both before and after the threshold requirements were met.

As to services that would have been provided in any event, the High Court in Van Gervan v Fenton , above, recognised that in the ordinary course of a marriage there is an element of give and take in the provision of mutually beneficial services. The qualification is that such services will be taken out of the area of the ordinary give-and-take of marriage to the extent that the injuries to the wife or husband preclude her or him from providing any countervailing services.

To that extent, the continuing gratuitous services provided by the spouse assume a different character and should be treated as additional services which have been or will be provided by that spouse to look after the accident-caused needs of the injured plaintiff. Nor is it permissible to aggregate the needs created by successive breaches of duty, for example, where those needs are generated by successive accidents, in order to meet the threshold requirements of the legislation: Thus, it was argued, the need for services did not arise solely out of the aggravation of the condition for which the defendant was responsible.

Beazley JA, although she said the section was not without difficulty, preferred a construction that was based on the definition of injury. Where care is not provided on a gratuitous basis, the reasonable cost of reasonably required commercially provided services is recoverable both for the past and future: There was a considerable difference between the cost of hour care in a rented apartment, as claimed by the plaintiff, and the cost of nursing-home care that the defendant argued would meet her reasonable requirements.

A plaintiff is only entitled to be recouped for such reasonable expenses as will reasonably be incurred as a result of the accident. It does not follow that every expenditure which might be advantageous for a plaintiff as an alleviation of his or her situation or which could give him or her happiness or satisfaction must be provided for by the tortfeasor.

The touchstone of reasonableness in the case of the cost of providing nursing and medical care for the plaintiff in the future is, no doubt, cost matched against health benefits to the plaintiff. If cost is very great and benefits to health slight or speculative the cost-involving treatment will clearly be unreasonable, the more so if there is available an alternative and relatively inexpensive mode of treatment, affording equal or only slightly lesser benefits.

When the factors are more evenly balanced no intuitive answer presents itself and the real difficulty of attempting to weigh against each other two incomparables, financial cost against relative health benefits to the plaintiff, becomes manifest.

Tobias AJA rejected the argument, as without legal basis, that the court must be satisfied that the amount awarded would actually be spent. In Perisher Blue Pty Ltd v Nair-Smith ALR the Court of Appeal accepted that the plaintiff was entitled to recover damages for the cost of commercially provided services at the established market rate rather than at the lower rate she paid for domestic assistance at the time of trial.

The court continued its practice of preferring the commercial rate on the basis that it was not known how much longer the current service provider would continue to work at the lower rate.

It was therefore necessary to consider the particular needs of the dependants involved. The right to damages addressed the needs of the dependants that would, but for injury, have been satisfied by the claimant and the question of whether those needs were reasonable in the circumstances.

If damages are awarded under the section, the assessment of non-economic loss must not include an element to compensate for loss of capacity to provide services to others: Other matters to be taken into account in the assessment of compensation are: Campbell JA, after reference to extensive authority dealing with the many aspects of dependency, said that the nature and extent of the care provided by the claimant to the children were such that a finding of dependence was open.

On the same basis, he rejected the claim that the services were in fact provided to the parents and not to the children. The defendant argued that these services were not services of a domestic nature so that they were not compensable. It caps only the hourly rate by which compensation is to be assessed.

Following his diagnosis with mesothelioma, he lost the capacity to provide this care, and his wife was admitted to a nursing home. The Compensation to Relatives Act provides for actions to be brought on behalf of dependants of deceased victims of compensable injury to recover for loss of financial support and funeral expenses. Only one such action may be brought so that all potential beneficiaries should be nominated as plaintiffs. Insurance, superannuation, payments from provident funds or statutory benefits are not to be taken into account in assessing an award of compensation: Although unanimously recognising changing social circumstances that cast doubt on prior authority, the High Court was divided on the issue.

Gleeson CJ accepted that this contingency should be dealt with when determining an appropriate adjustment for vicissitudes. He questioned the continued use of the term dependency to describe the right to compensation when, in modern society, it was common for both parties to a relationship to earn income and to have the capacity for financial self-support.

He accepted, however, that each party to the relationship might have expectations of direct financial support. He pointed to the anomaly involved in taking into account an established new relationship at the time of trial while making no allowance for repartnering when there was none.

This was a factor to be proved in the usual way and there was no special legal or evidentiary status attaching to the Luntz tables. The Civil Liability Act makes no reference to actions of this nature. They answered in the negative, the plurality pointing out:. It was not an exception or variation to the law of negligence but remained a distinct cause of action.

The court indicated that caution should be exercised in expanding the scope of recoverable damages in such actions and confirmed that they did not extend to loss of profits or recovery of sick pay, pension or medical expenses payable to the employee.

Statutory benefits provide for compensation in the form of income loss; medical and other treatment expenses and attendant care services. The regime for the payment of statutory benefits for medical expenses and attendant care services applies to all claims.

The statutory benefits payable for income loss extend to those claims that do not proceed to claims assessment or court. Part 4 of the Motor Accident Injuries Act deals with awards of damages by a court and the assessment of damages by a claims assessor in respect of motor accidents.

It provides for modified common law damages. A certificate may be issued when:. An injury to a spinal nerve root that manifests in neurological signs other than radiculopathy is included as a soft tissue injury for the purposes of the Act.

Each of the following injuries is included as a minor psychological or psychiatric injury for the purposes of the Act:. These expenses are dealt with through the statutory benefits regime.

The Act expressly provides that no compensation is payable for gratuitous attendant care, leaving open the question of whether the loss of capacity to provide these services remains for assessment under the umbrella of non-economic loss: There is little change to the parameters for the assessment of loss of capacity to earn income: These limits do not apply to awards of damages in claims brought under the Compensation to Relatives Act Those claims are effectively unchanged by the Motor Accident Injuries Act.

Income loss is permitted only up to the maximum weekly statutory benefits amount, notwithstanding that this is a gross earnings amount: This amount is adjusted annually on 1 October: Credit must be given for any weekly payments made under the statutory benefits provisions: Assessment of non-economic loss remains essentially unchanged: At this stage this aspect remains unregulated. Blameless accidents are now referred to as no-fault motor accidents.

The issues in Gray v Richards , above, were whether the right of recovery extended to the cost of managing the sum awarded for management of the fund the fund management damages issue and whether it extended to the cost of managing the predicted future income of the managed fund the fund management on fund income issue. Expenses of fund management by whatever trust company was appointed were to be included in this assessment.

The court rejected the claim for the costs of fund management on fund income. Having applied the discount rate to damages awarded to cover future loss no further allowance should be made. It was inconsistent with this comprehensive dismissal of any further allowance to suggest that the cost of managing the income generated by the fund to ensure that it maintains a net income at a given rate was a compensable loss.

The capital and income of the lump sum award for future economic loss would be exhausted at the end of the period over which that loss was expected to be incurred. It would be contrary to the principles of Todorovic v Waller , above, to assume that the fund would generate income that would be reinvested and swell the corpus under management, an assumption that could not be made when drawings from the fund might exceed its income.

In such actions, the worker may or may not join the employer. The provision applies where the worker takes or is entitled to take proceedings against both the third person and the employer: The need arose because, upon the introduction of the scheme for modification of the common law rights of a worker against an employer, it was no longer possible to determine the respective liabilities of an employer and a third party by reference simply to the proportions in which they were held to be responsible for the damage suffered by the employee.

The right of a worker to recover common law damages against an employer has been increasingly limited to the point where, commonly, no rights exist.

If the threshold is not met, there is no right of recovery of any common law damages against the employer. This outcome has prompted the argument that there is no entitlement to take proceedings against the employer.

The Court of Appeal has consistently rejected this argument. Once established that an employer owed a duty of care that was breached, causing loss to the plaintiff, the entitlement was established. The right to recover damages was irrelevant: A worker who does not join the employer cannot be compelled to undergo assessment.

No compensation in the nature of aggravated or exemplary damages is recoverable through claims made under the statutory schemes: Damages under these heads remain available in the limited categories of personal injury claims that are not dealt with under these schemes.

It is very important to distinguish between aggravated and exemplary damages. In the past, courts have tended to award a single sum to account for both types of damage but it is now accepted that the better practice is to distinguish between amounts awarded under these heads and to provide reasons in each case. In this regard it is relevant to note that the matters to which I have referred as justifying an award of exemplary damages are also pertinent, as is often the case, to an award of aggravated damages.

The difference is that in the case of aggravated damages the assessment is made from the point of view of the Plaintiff and in the case of exemplary damages the focus is on the conduct of the Defendant.

Nevertheless, it is necessary, as I have noted above, to determine both heads of compensatory damages before deciding whether or not the quantum is such that a further award is necessary to serve the objectives of punishment or deterrence or, if it be a separate purpose, condemnation. The award of damages under these heads is discretionary and caution is required to ensure that the circumstances in which they awarded are appropriate. There is no doubt that if a plaintiff is saying: This is relevant to the question of whether or not exemplary damages should be awarded, and, if so, how much.

Accordingly, the position in Australia is that exemplary damages may not be awarded where substantial criminal punishment has been imposed. However, the High Court in Gray did not preclude an award of exemplary damages where something other than substantial punishment was imposed, and in accordance with the authorities in this Court exemplary damages may be awarded in some circumstances notwithstanding that a criminal sanction has been imposed.

Her Honour concluded that conviction for assault and the imposition of a bond was a substantial punishment such that exemplary damages were not warranted on this basis. Her Honour did, however, accept at [] the other basis for the award of exemplary damages, namely, that the manner in which the appellant defended the claim for damages was unusual in the sense used in Gray v Motor Accidents Commission.

Damages under this heading may be awarded to a plaintiff who suffers increased distress as a result of the manner in which a defendant behaves when committing the wrong or thereafter. He expressed serious doubt about when they might be claimed in negligence actions or about the need for such damages when elements such as injured feelings and distress could be dealt with in an award for general damages. In my opinion, the only principled explanation must be along the following lines.

It is extremely difficult to quantify damages for hurt feelings. In cases of hurt feelings caused by ordinary wrong-doing, of a kind consistent with ordinary human fallibility, the court must assess damages for hurt damages neutrally, and aim towards the centre of the wide range of damages that might conceivably be justified.

However, in cases of hurt to feelings caused by wrong-doing that goes beyond ordinary human fallibility, serious misconduct by the defendant has given rise to a situation where it is difficult to quantify appropriate damages and thus where the court should be astute to avoid the risk of under-compensating the plaintiff, so the court is justified in aiming towards the upper limit of the wide range of damages which might conceivably be justified.

Exemplary damages are awarded as a form of punishment: They may be awarded for a tort committed in circumstances involving a deliberate, intentional or reckless disregard for the plaintiff and his or her interests. The objects of the award may include condemnation, admonition, making an example of the defendant, appeasement of the plaintiff in order to temper an urge to exact revenge, or the expression of strong disapproval.

It may include elements of malice, violence, cruelty, high-handedness or abuse of power. The amount should also be such as to bring home to those officials of the State who are responsible for the overseeing of the police force that police officers must be trained and disciplined so that abuses of the kind that occurred in the present case do not happen. The award of exemplary damages is rare in actions for negligent conduct. Damages were assessed by reference to the sum paid for the dental services and interest.

Although required to be proportionate to the circumstances, in an appropriate case, exemplary damages may exceed compensatory damages: The legislation introduces a regime for assessment of claims that is similar to that provided for in relation to common law claims for workplace accidents. The Parliament may well not have been prepared to exclude liability for exemplary damages, even in cases of relatively minor physical or mental impairment, where the conduct of its officers, for which it accepts vicarious liability, demonstrates egregious disregard of the civil rights of its citizens.

The court concluded, however, that aggravated damages were not available to an offender in custody. Aggravated damages were designed to deal with matters such as humiliation and injury to feelings and provided compensation for mental suffering that fell short of a recognised psychiatric illness. In that sense, in contrast to exemplary damages they were compensatory. An intentional tort is described as the intentional infliction of harm without just cause or excuse.

The presence of an intention to cause harm is central to the imposition of liability. The tort frequently involves conduct that results in criminal as well as civil liability, although it extends to conduct that causes harm to reputation, trade or business activity. One who intentionally causes injury to another is subject to liability to the other for that injury, if his conduct is generally culpable and not justifiable under the circumstances.

The concept of an intention to cause harm, in the context of the law of negligence, has been the subject of a degree of judicial consideration and much academic consternation concerning the extent to which intentional conduct can be described or pleaded as negligent. The exclusion of intentional torts from the strictures of the Civil Liability Act has also generated judicial scrutiny of this class of tort.

Section 3B 1 a provides:. The provisions of this Act do not apply to or in respect of civil liability and awards of damages in those proceedings as follows:. Part 7 Self-defence and recovery by criminals in respect of civil liability in respect of an intentional act that is done with intent to cause injury or death, and. The attraction of this provision is that, if the wrong of which a plaintiff complains can be brought within its scope, the constraints on damages contained within the Act can be avoided, with the exception of those relating to the recovery for gratuitously provided care services.

Damages in claims of intentional torts are at large, with the exception of those claimed for voluntarily provided care. They may therefore range from a nominal amount, where a plaintiff is unable to establish actual damage, to substantial damages on all heads for personal injury.

Aggravated and exemplary damages are also available in appropriate cases. Application of the provisions of the section has not been straightforward, issues to date encompassing the following. It is in this area that incongruity arises in the context of the law of negligence. He said an action for the negligent infliction of harm was not barred because of the intentional act of the person causing the harm.

He said it was meaningless at least in the civil sphere to speak of an assault that was consensual. The difficulty created by the failure to plead separately the allegations of negligence and assault is most clearly demonstrated in claims of medical negligence where the question of consent to treatment arises.

Anglo-Australian law has rightly taken the view that an allegation that the risks inherent in a medical procedure have not been disclosed to the patient can only found an action in negligence and not in trespass; the consent necessary to negative the offence of battery is satisfied by the patient being advised in broad terms of the nature of the procedure to be performed.

Consent may be vitiated by fraud, misrepresentation, treatment that materially differs from that to which the consent was given or the improper purpose for the provision of the treatment. The motive for the provision of medical treatment is relevant to the issue of whether consent was obtained through fraud or misrepresentation or for an improper purpose.

The majority view in that case was that it was therefore unnecessary to consider further whether the practitioner acted fraudulently.

There may be circumstances where more than motive exists for misconduct. A person who enters land within the scope of his or her authority does not necessarily become a trespasser because he or she has some other purpose in mind. Thus improper purpose, even if it falls short of fraud is relevant to the issue of whether medical treatment was outside the terms of any consent. It is not necessary that the plea of trespass to the person or assault contain a specific allegation of absence of consent.

The plea itself is sufficient under the rules of common law pleading to amount to an allegation of non-consensual conduct: White v Johnston , Barrett JA. It is the second of these requirements that presents the greatest challenge to litigants. It is not necessary that the intended injury be physical. Spigelman CJ thought this was sufficient to establish that the officer acted with the intent to cause injury namely an apprehension of physical violence. It is not necessary that the intentional act be criminal in character.

He noted, however, that in Dean v Phung , above, whilst the primary intention was that of monetary gain, the dentist was found to have the intention to cause harm sufficient to meet the requirements of the section because at the time of giving the relevant advice he knew that the treatment proposed was unnecessary.

That role is that, where the other elements of the tort are made out, a finding that the defendant intended the consequences which came to pass will be sufficient to support an award of damages against the defendant in respect of that consequence.

It will not necessarily be sufficient that the wrongdoer intended damage different in kind from that which occurred … That is to say, it will depend upon the relation of that which the wrongdoer intended to the consequences which actually resulted. The issue of whether the intended injury must be physical so that it did not extend to psychological injury has been disposed of by the principle that the wrongdoer intends the harm that is the natural and probable consequence of the conduct.

In TCN Channel Nine Pty Ltd v Anning , above, however, the Court of Appeal rejected the claim in the absence of evidence that the mental trauma claimed by the plaintiff amounted to a recognised psychiatric disorder. Humiliation, injured feelings and affront to dignity resulting from trespass, the court said, were compensable through the means of aggravated damages. He approached the issue from two perspectives.

He said the onus was at all times on the plaintiff to prove that consent was vitiated by fraud because:. After examining competing views he rejected the argument that the onus of proof was on a defendant who pleaded consent to a claim of assault and battery or trespass to the person. His major reason for doing so was to provide coherence between the criminal and civil law. It does not strike me as jarringly wrong for a civil plaintiff to be obliged to discharge the same burden albeit, only to the civil standard in order to establish a tortious assault and battery.

The Court of Appeal held that an employer was vicariously liable in damages, including exemplary damages, where the intentional tort was committed:. He said the employer could not escape liability under the general law by demonstrating that it did not have the intention of its employee. Damages are compensatory in character. The onus is on the plaintiff to prove the injury or loss for which damages are sought. The plaintiff may recover loss or expense incurred in a reasonable attempt to mitigate.

The following are the steps required in the assessment of non-economic loss in accordance with this section: To what extent was it impaired by the injury? To what extent was the impairment productive of income loss? In both cases the evidence must establish more than a mere suggestion of loss or capacity.

Medical care and aids. It was reasonably necessary to provide the services. It would be reasonably necessary to do so at a cost. Loss of capacity to care for others.

Damages are not recoverable: