Lai Wai Keong Eugene v Loo Wei Yen

• Jurisdiction: Singapore
• Judge: Chao Hick Tin JA
• Judgment Date: 29 May 2014
• Neutral Citation: [2014] SGCA 31
• Court: Court of Appeal (Singapore)
• Docket Number: Civil Appeal No 170 of 2012
• Published date: 06 June 2014
• Year: 2014
• Hearing Date: 24 April 2014,05 November 2013
• Plaintiff Counsel: Anthony Wee and Pak Waltan (United Legal Alliance LLC)
• Defendant Counsel: Desmond Tan Yen Hau (Lee & Lee),Teo Weng Kie and Charlene Chee (Tan Kok Quan Partnership),Michael Low Wan Kwong (Crossbows LLP) and Linus Ng Siew Hoong (Robert Wang & Woo LLP)
• Subject Matter: Damages
• Citation: [2014] SGCA 31

Chao Hick Tin JA (delivering the judgment of the court): Introduction

This is an appeal against the decision of the High Court in Registrar’s Appeal No 273 of 2012, where the judge (“the Judge”) dismissed the appellant’s appeal against an award of damages made by an assistant registrar (“the AR”). The Judge’s decision is reported in Lai Wai Keong Eugene v Loo Wei Yen [2013] 3 SLR 1113 (“the GD”), and the AR’s decision, in Lai Wai Keong Eugene v Loo Wei Yen [2012] SGHCR 8.

The case concerns the assessment of damages for the loss of future earnings (“LFE”) and future medical expenses (“FME”) of a tort victim who is injured in an accident. The conventional approach in assessing damages in such cases involves the selection of: an appropriate multiplicand representing the plaintiff’s projected annual future earnings or medical expenses (depending on whether it is LFE or FME that is being assessed); and an appropriate multiplier representing the plaintiff’s remaining working life or life expectancy (again, depending on whether it is LFE or FME that is being assessed), discounted for accelerated receipt and the vicissitudes of life. The central issue in this appeal is whether the conventional approach should be departed from or otherwise reviewed in the light of changes to the statutory minimum retirement age (“the minimum retirement age”) and the prevailing real interest rates.

We first heard the appeal on 5 November 2013. At that hearing, counsel for the appellant, Mr Anthony Wee (“Mr Wee”), averred (among other things) that the multiplier used for the calculation of LFE had traditionally been capped at 16 years, even for young plaintiffs. As the reason for this purported cap was unclear, we adjourned the hearing for further submissions on: the historical origins of the multiplier which has been applied in comparable cases and the rationale for the cap of 16 years on the multiplier; and whether the multiplier should be reviewed in the light of the increase in the minimum retirement age or otherwise.

In addition, as the appellant was advocating a radical departure from the usual method of assessing damages in personal injury cases, we considered it necessary to hear the views of other stakeholders before making a decision. We therefore invited the Consumers Association of Singapore (“CASE”) and the General Insurance Association of Singapore (“GIA”) to tender written submissions and attend a hearing before us. After hearing the parties again on 24 April 2014, we now give our decision.

The facts

The appellant was born in July 1972.¹ On 12 April 2007, the appellant, while riding a motorcycle, collided with a car which the respondent was driving. The appellant suffered catastrophic injuries as a result of the accident, and is now a paraplegic with no sensation or motor control from his upper chest downwards. He requires a wheelchair to move about and drives himself around using a modified vehicle.

Following the accident, the respondent pleaded guilty to a charge under s 65 of the Road Traffic Act (Cap 276, 2004 Rev Ed) of driving without due care or reasonable consideration. He was fined $1,000 and disqualified from driving for four months.

The proceedings below

On 25 August 2009, the appellant sued the respondent, seeking damages for negligence. The respondent consented to interlocutory judgment, accepting 90% liability for the accident, with damages to be assessed.

The hearing for the assessment of damages commenced on 21 November 2011, by which time the appellant was 39 years old. At the hearing, the appellant produced a report² by an accounting expert, Mr Foong Daw Ching. The report contained a present value table setting out the capital sum required to compensate the appellant for LFE based on his expected future earnings over a remaining working lifespan of 27 years, at interest rates varying between 0% and 5%. Using this table, the appellant argued that a 1% interest rate should be adopted together with a 10% discount for vicissitudes, resulting in an LFE award of $1,823,034.60.³ Alternatively, the appellant submitted, if the conventional approach were to be used, a multiplier of 21 should be applied. The appellant further argued that a multiplier of 23 should be used for the calculation of FME.

The AR did not agree with the appellant’s submissions. Holding that it was inappropriate to use present value tables (also known as annuity tables) to assess damages for LFE, he instead looked at past cases involving plaintiffs of similar ages to determine the appropriate multiplier. He accordingly applied a multiplier of 13 for LFE and 15 for FME, and assessed the appellant’s damages as follows: Special damages: Pre-trial medical expenses agreed at $51,934.87 Pre-trial transport expenses agreed at $2,000.00 Paraplegic equipment and toiletries agreed at $15,865.03 Cost of maid/nursing care agreed at $15,275.35 Pre-trial loss of earnings assessed at $162,349.20 Pre-trial loss of employer’s CPF agreed at $24,976.80 Pre-trial loss of allowances agreed at $6,978.24 Loss of motorcycle agreed at $9,617.00 Cost of purchasing Suzuki Swift assessed at $45,653.00 Cost of modifying Suzuki Swift assessed at $750.00 $335,399.49 General damages: Pain and suffering and loss of amenities assessed at $200,000.00 FME assessed at $486,000.00 Other future expenses (not including (ii)) assessed at $171,770.00 LFE assessed at $880,262.93 $1,738,032.93

Dissatisfied with the AR’s award for LFE and FME, the appellant appealed to the High Court. Relying on this court’s decision in Poh Huat Heng Corp Pte Ltd and others v Hafizul Islam Kofil Uddin [2012] 3 SLR 1003 (“Hafizul”), he argued that the court could and should depart from the conventional approach in assessing damages for LFE, and should instead use present value calculations to determine the LFE award. He further contended that the multiplier used by the AR for calculating his FME was too low.

The Judge dismissed the appellant’s appeal. Rejecting the appellant’s reliance on present value tables, he held that the conventional approach ought to be applied for reasons of precedent, principle and policy, which may be summarised as follows: The Judge considered himself bound by the decisions in Lai Wee Lian v Singapore Bus Service (1978) Ltd [1983–1984] SLR(R) 388 (“Lai Wee Lian”) and Tay Cheng Yan v Tock Hua Bin and another [1992] 1 SLR(R) 779 (“Tay Cheng Yan”) to apply the conventional approach, and did not read Hafizul as undermining the binding authority of either case (see the GD at [61]). The Judge was concerned that discounting separately for the vicissitudes of life and accelerated receipt would require each plaintiff to adduce expert evidence from actuaries and economists, thereby greatly increasing the costs and complexity of litigation without necessarily improving the accuracy of assessments (see the GD at [63]). The Judge acknowledged (at [67] of the GD) that lump sum awards were bound to be inaccurate. He pointed out, however, that the discounts embedded in the multiplier used under the conventional approach reflected the common law’s allocation of the risk of inaccurate compensation as between tort plaintiffs as a class and tort defendants as a class. The Judge stated (at [69] of the GD) that the issue of “[w]hether to unpack and alter that embedded assessment of reasonable risk, and where to set that level of risk, [was] a very difficult question of policy” that a court of first instance could not and should not engage in. The Judge observed that the overall effect of adopting the present value approach proposed by the appellant was to effect an across-the-board increase in the level of awards for LFE. That too, he noted, raised difficult questions of policy, and such change (if it was to be implemented) was something to be effected by either the Court of Appeal or the Legislature, and not by the High Court (see the GD at [72]).

Applying the conventional approach, the Judge found that the multipliers used by the AR were consistent with the multipliers used in past cases.

The issues before this court

The present appeal raises the following issues: Should we depart from the conventional approach in assessing damages for personal injury? Assuming the conventional approach is retained, should the multipliers used thereunder be revised in the light of changes in social and economic conditions? In any event, should the AR’s award be disturbed?

Our decision Whether we should depart from the conventional approach

From the 1940s to the 1970s, Malaysian and Singapore courts generally awarded damages for future losses by way of a lump sum award. The assessment of the appropriate lump sum appeared to be a matter of gut feeling; the courts did not usually calculate – at least not explicitly – the victim’s projected LFE over his remaining working life. An example is the case of Katijah Binti Abdullah v Lee Leong Toh & Another [1940] MLJ 87, where the court explained its decision for awarding $2,000 in damages for LFE and pain and suffering in the following terms (at 89):

As to damages claimed by the plaintiff, I take into account the fact that her special aptitude for bangsawan work has been destroyed: it is obvious that the lack of an arm would reduce her value as a dancer and singer of the type [which] she was to nothing. In addition she has suffered the loss of a right arm and considerable shock and pain and disfigurement: she is incapacitated as a wife from working and even clothing herself with any comfort and her loss is one that will go with her to her grave. While it is impossible to make good the loss of her arm it is I think reasonable to assume that she should be put into a position where she would not in case of her husband’s death or divorce be plunged into complete poverty more hampered to meet it than most of her sisters and should be recompensed for...