In South Western Sydney Local Health District v Sorbello [2024] NSWCA 14, the New South Wales Court of Appeal has provided timely guidance on two important issues in personal injury litigation: how courts choose between competing expert opinions on mental harm, and the correct approach to assessing residual earning capacity where a plaintiff has established a loss of earning capacity.
While the case arose from tragic circumstances—the catastrophic injuries suffered by Joseph Sorbello during birth due to admitted negligence—the Court’s careful examination of these legal issues provides a valuable framework for practitioners handling similar claims involving psychiatric injury and economic loss.
Background
The respondent, Ms Sorbello, gave birth to her son Joseph in 2008 at Bankstown Hospital. Due to oxygen deprivation during birth, Joseph was born with profound disabilities, significantly reduced life expectancy, and a lifelong need for care. A separate claim on his behalf was resolved on confidential terms.
Ms Sorbello, however, pursued a personal injury claim for psychiatric injury suffered as a result of witnessing her son’s traumatic birth and coping with its aftermath. The primary judge awarded her damages under several heads, including:
- Non-economic loss assessed at 35% of a most extreme case;
- Past economic loss, on the basis that she was unable to work since the injury;
- Future economic loss, amounting to over $1.27 million, based on a finding that while she retained a theoretical residual earning capacity, there was no evidence of any employment that would permit her to exploit it.
The Appeal
The Health District challenged the award on two primary grounds:
- That the trial judge erred in preferring the psychiatric evidence of Dr Allnutt and Ms Luca (for the plaintiff) over that of Dr Brown (for the defendant); and
- That the trial judge improperly cast an onus on the Health District to demonstrate what employment remained open to Ms Sorbello, instead of applying the High Court’s approach in Malec v J C Hutton Pty Ltd (1990) 169 CLR 638.
Both grounds were rejected by the Court of Appeal.
Expert Evidence: More than Quantity
The Health District contended that Dr Brown’s evidence ought to have been preferred because she saw Ms Sorbello on two occasions, compared with the single consultations undertaken by the other experts. Simpson JA (with Macfarlan and Meagher JJA agreeing) firmly rejected this submission, describing it as “superficial.” The Court emphasised that the weight of expert evidence was aligned with the opinions of Dr Allnutt and Ms Luca, and that Dr Brown’s attribution of Ms Sorbello’s psychiatric condition to unrelated personal factors was unsupported by the objective evidence.
Importantly, the Court also upheld the trial judge’s reliance on lay evidence in assessing the impact of the psychiatric condition on Ms Sorbello’s ability to work. The Court confirmed that such evidence can appropriately inform a judge’s evaluation of expert testimony and the plaintiff’s overall functional capacity.
Residual Earning Capacity and the Burden of Proof
A central issue on appeal was the trial judge’s treatment of the plaintiff’s residual earning capacity. The Health District argued that the judge had erred in imposing a burden on the defendant to prove that Ms Sorbello could in fact earn income in future.
The Court of Appeal rejected this contention, reaffirming that once a plaintiff establishes a loss of earning capacity, it falls to the defendant to prove that the plaintiff failed to mitigate their loss by exploiting any residual capacity. This principle was consistent with prior authority, including Nominal Defendant v Livaja [2011] NSWCA 121 and Mead v Kearney [2012] NSWCA 215.
The Court distinguished Malec, finding it inapplicable. That case concerned the hypothetical risk that a condition might have occurred regardless of the defendant’s negligence. In Sorbello, there was no dispute that the psychiatric injury was caused by the admitted negligence. The Court clarified that the Malec principles did not apply where causation is established, and any general uncertainties about the future are more appropriately addressed by the standard allowance for vicissitudes.
The Prospect of Employment Caring for Joseph
The Court also addressed whether Ms Sorbello’s damages ought to have been reduced on the basis that she might be employed by Joseph as a carer, using funds received in his own settlement. This argument was rejected. The Court found that there was insufficient evidence about the terms or composition of the award made to Joseph, and specifically whether it included provision for commercial attendant care services.
In the absence of clear evidence, it would have been speculative and improper to reduce Ms Sorbello’s award on the basis of a hypothetical employment arrangement.
Takeaways
The Sorbello decision underscores several important points for personal injury practitioners:
- A trial judge is entitled to weigh the quality of expert evidence over the quantity or frequency of consultations. A superficial argument about relative exposure to the plaintiff will not suffice if the evidence is otherwise compelling and consistent.
- Lay evidence remains a relevant and appropriate consideration in determining functional capacity, even where psychiatric diagnoses are involved.
- Once a plaintiff has shown a loss of earning capacity, it is for the defendant to demonstrate that the plaintiff could realistically earn income despite that loss.
- The Malec framework for dealing with contingencies does not apply where the defendant’s negligence is the accepted cause of the injury.
- Care should be taken before assuming that a plaintiff can derive income through paid care funded by another party’s damages—especially where the quantum and basis of such awards are unclear.
Conclusion
Sorbello is a poignant example of the complexities that arise in mental harm claims stemming from catastrophic injury to a loved one. Beyond the emotional dimensions of the case, it offers valuable legal clarification on the treatment of expert psychiatric evidence and the assessment of residual earning capacity. For practitioners, it serves as both a guide and a warning: evidentiary assumptions must be supported, and attempts to shift the burden onto the plaintiff inappropriately will not find favour with the courts.
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