Richards v Gray [2013] NSWCA 402

Richards v Gray [2013] NSWCA 402

The respondent was entitled to damages for reasonable fund management fees because her tortiously caused injuries rendered her incapable of managing the fund, but the allowance should be calculated only on the initial fund managed by The Trust Company. Fund management on fund income was disallowed because the statutory discount rate assumes a rate of return accounting for the costs of earning income and because calculating income over the life of the fund would require speculative assumptions that the discount-rate methodology is intended to avoid. Fund management on fund management was disallowed because the exception allowing fund management costs should not be extended to further fees...

Jurisdiction
Australia
Judgment Date
02 December 2013
Procedural Posture
Appeal Concerning Damages for Personal Injuries, Specifically Fund Management Costs for a Protected Estate / Appeal From Gray V Richards [2011] NSWSC 877, Gray V Richards (no 2) [2011] NSWSC 1502 and Gray V Richards (no 3) [2012] NSWSC 344
Outcome
Appeal allowed in part.
Legal Topics
['measure of Damages' 'cost of Fund Management' 'fund Management on Fund Management' 'fund Management on Fund Income' 'discount Rate' 'protected Person Incapable of Managing Affairs' 'costs']
['torts' 'damages' 'personal Injury' 'civil Procedure' 'protected Estates'] ['measure of Damages' 'cost of Fund Management' 'fund Management on Fund Management' 'fund Management on Fund Income' 'discount Rate' 'protected Person Incapable of Managing Affairs' 'costs']

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Procedural Posture

Appeal Concerning Damages for Personal Injuries, Specifically Fund Management Costs for a Protected Estate / Appeal From Gray V Richards [2011] NSWSC 877, Gray V Richards (no 2) [2011] NSWSC 1502 and Gray V Richards (no 3) [2012] NSWSC 344

Legal Issues

  1. 1 ['Whether the amount awarded for fund management expenses should include an amount for fund management on fund management.' 'Whether the amount awarded for fund management expenses should include an amount for fund management on fund income.' 'When calculating fund management expenses, whether certain components should be deducted from the corpus of the verdict.' 'Whether fund management expenses should be assessed at the rates charged by The Trust Company Limited or the lower rates charged by the NSW Trustee and Guardian.' 'What orders should be made as to the costs of the trial and the appeal.']

Ratio Decidendi

The respondent was entitled to damages for reasonable fund management fees because her tortiously caused injuries rendered her incapable of managing the fund, but the allowance should be calculated only on the initial fund managed by The Trust Company. Fund management on fund income was disallowed because the statutory discount rate assumes a rate of return accounting for the costs of earning income and because calculating income over the life of the fund would require speculative assumptions that the discount-rate methodology is intended to avoid. Fund management on fund management was disallowed because the exception allowing fund management costs should not be extended to further fees...

Court Disposition

Appeal allowed in part.

Orders

  • ['Appeal allowed in part.' 'Set aside order (1) entered on 16 December 2011 and, in place thereof, give judgment for the plaintiff in the sum of $11,424,000.' 'Each party file and serve within 14 days his or her primary submissions with respect to appropriate orders as to the costs of the trial and the costs of the...