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Sexual assault – exemplary damages – psychiatric condition – future economic loss”: Nive -v- SS [2006] NSWCA 338

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Author: Andrew Adam
Judgement Date: 30th November, 2006
Citation: Nive -v- SS [2006] NSWCA 338
Jurisdiction: NSW Court of Appeal
In Brief
  • While it is generally desirable to conclude criminal proceedings before the hearing of related civil proceedings, a civil trial judge has a broad discretion to stay civil proceedings.  Prima facie, plaintiffs are entitled to have their matters proceed in the ordinary way.  A defendant must demonstrate positively why a stay is justified.
  • A court may award exemplary damages against a defendant, even if that defendant has been acquitted in criminal proceedings arising from the same conduct.
  • An award of economic loss by way of “cushion” or “buffer” is necessarily arbitrary.  A trial judge might properly make an award on a relatively thin substratum of evidence.
Background
  • On a number of occasions in 1997, the defendant sexually assaulted the plaintiff, then aged 13 years.
  • In late 2004, the plaintiff commenced civil proceedings for damages.  In early 2005, the defendant was charged with criminal offences arising out of the conduct alleged in the civil proceedings.
  • The defendant sought a stay of the civil proceedings until conclusion of the committal hearing on the criminal charges.  He argued that his defence of the criminal proceedings would be prejudiced if he had to reveal the nature of his defence in the civil proceedings.  He also argued that, having been cross examined in the civil proceedings, the plaintiff would be able to tailor his evidence in the criminal proceedings.
  • The trial judge applied the guidelines set down by Wootten J in McMahon v Gould (1982) 7 ACLR 202.  The civil hearing therefore proceeded before conclusion of the criminal proceedings.
  • The plaintiff succeeded at the civil trial.  Amongst the damages awarded to him were $180,000 for general damages, $120,000 for future economic loss and $60,000 exemplary damages.
  • Subsequent to judgment in the civil proceedings, the criminal proceedings went to a hearing.  The defendant was acquitted of all criminal charges relating to the assaults on the plaintiff.
Decision on Appeal
  • Tobias JA gave the leading judgment, with which Giles JA agreed and Beazley JA agreed generally.
  • The defendant appealed on a number of grounds, principally that:
  • The civil judge ought to have stayed the civil hearing until conclusion of the criminal proceedings;
    • Since he had been acquitted in the criminal proceedings, an award of exemplary damages was no longer open.
    • The trial judge had made the award of future economic loss on a deficient evidentiary basis.

Stay of civil proceedings pending resolution of criminal proceedings

  • Tobias JA found that the trial judge’s discretion did not miscarry in declining to stay the civil proceedings.  The trial judge had correctly considered the factors set out in McMahon, which can be summarised as:
    • The plaintiff has a prima facie entitlement to have his action heard in the ordinary manner.  A defendant must show proper grounds for a stay before this right of the plaintiff can be interfered with.
    • Each case must be considered on its own merits, so that justice may be balanced between the parties, taking into account all relevant factors.
    • While an accused in criminal proceedings has a right to silence, he does not enjoy it in concurrent civil proceedings.  Therefore, he may be required to disclose the defence on which he proposes to rely in the criminal proceedings during the interlocutory processes of the civil proceedings.
  • Kirby P in Yuill v Spedley Securities Limited (1992) 8 ACSR 272, held, obiter, that the public interest is in the primacy of the administration of criminal justice and that the principles of McMahon may not adequately reflect this public interest.
  • The Court of Appeal was not asked in this matter to re examine the guidelines in McMahon.  Beazley JA did note, however, that it may be appropriate, in a future case, to examine the effect of Yuill on McMahon.
  • Tobias JA found that the defendant had not been prejudiced in the manner in which the plaintiff was examined in the civil proceedings.  On this basis, the Court of Appeal declined the appeal against the refusal of the stay.

Exemplary Damages

  • Exemplary damages may be awarded to punish a defendant where the defendant’s conduct demonstrates a contumelious disregard for the plaintiff’s rights.  They are awarded over and above those damages necessary to compensate the plaintiff.
  • Since exemplary damages are meant to punish the defendant, should the defendant have already received “substantial punishment” in related criminal proceedings, it is not open to a civil court to award exemplary damages.  Otherwise the defendant would be subject to double punishment.  Where a defendant has not yet been punished (for example, where the criminal proceedings have not been concluded) exemplary damages are open to be awarded.  An award of exemplary damages may, however, be relevant to a sentence imposed in the criminal proceedings.
  • The defendant argued that the subsequent criminal acquittals should be admitted as fresh evidence, and on the basis of this fresh evidence, the award of exemplary damages should be overturned.  The Court of Appeal rejected this argument.
  • Firstly, exemplary damages are awarded in civil proceedings on the balance of probabilities, whereas a criminal conviction can only be secured beyond reasonable doubt.  This difference in standards of proof means that different answers to the same question may be given in civil and criminal proceedings.  (Readers will recall the OJ Simpson matter where the defendant was acquitted in criminal proceedings, but was nonetheless found liable in damages to the survivors of his victims.)
  • Additionally, since an acquittal meant that no punishment was levied on the defendant, no question of double punishment arose.
  • The Court of Appeal left open the question as to what would be sufficiently “substantial punishment” to remove the jurisdiction to award exemplary damages.  
    • In this matter, there was obviously no “substantial punishment”, and exemplary damages were available.  
    • In the leading High Court authority (Gray v Motor Accident Commission (1998) 196 CLR 1), the defendant had been sentenced to seven years imprisonment for intentionally causing grievous bodily harm, the injuries sued on in the civil proceedings.  No question therefore arose in that matter as to whether the punishment was sufficiently substantial.
    • Because criminal sentencing involves a range of factors irrelevant to civil damages, the sentence imposed on a particular criminal defendant may not reflect the prima facie seriousness of his conduct.  Therefore, it remains open as to whether relatively insubstantial sentences (for example, a suspended term of imprisonment) will be sufficiently substantial punishment to deny a civil court the jurisdiction to award exemplary damages.

Future Economic Loss

  • The plaintiff led little evidence of his earnings prior to the hearing, due to an unrelated workers’ compensation claim.  The little evidence that the plaintiff did lead on economic loss is not apparent from the Court of Appeal judgment.  That evidence appears to have comprised the plaintiff’s evidence of his work history, apparently including the occupations of shop assistant, barman, waiter, or clerk.  
  • The trial judge found that the plaintiff could earn about $500 a week in the stated occupations.  He also found that, due to a psychiatric condition arising from the assaults, he would be unfit for about three years (there appears to have been medical evidence of this period of incapacity).  On this basis, without applying discounts for vicissitudes or for lump sum payment, he awarded the plaintiff $480 a week over three years, or “roughly $75,000”.  To this, the trial judge added an additional global $45,000 to reflect the prospect that the plaintiff would, in the future, face additional difficulty in the workplace.  In total, he made an award of $120,000.
  • Tobias JA stated that “the very nature of an award of future economic loss which is provided by way of a buffer or cushion” is that it will be arbitrary.  As a matter of common sense, Tobias JA stated that it would be difficult to argue that about $500 each week would be an inappropriate level of remuneration in the occupations identified by the trial judge.  On this basis, Tobias JA found that the trial judge made no error in determining the appropriate level of future economic loss.
Implications
  • From a defendant’s point of view, it is generally preferable that criminal proceedings are concluded prior to the hearing of any civil claim.  A defendant may be reluctant to put forward the whole of his defence in the civil proceedings for fear that it may prejudice his defence in the criminal proceedings.  The court has left open the prospect that, in a future case, it will find that the criminal proceedings should be given primacy.  In the meantime, the onus is on a defendant to show that justice requires that the plaintiff’s claim be delayed pending resolution of the criminal proceedings.  In many cases (such as this one), this will lead to the civil proceedings going to judgment before the criminal trial.
  • Where a defendant is acquitted in criminal proceedings, the jurisdiction remains for a civil court to award exemplary damages.  It remains to be seen how “substantial” a punishment must be before it will foreclose an award of exemplary damages.
  • The Court of Appeal has upheld a substantial award for future economic loss on an apparently thin evidentiary basis.  This lack of evidence is perhaps borne out by Tobias JA’s justification of the trial judge’s approach on the basis of “common sense”.  This decision may, unjustly, require defendants to effectively bear the onus of proof on questions of the extent of future economic loss.

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