High Court says superannuation counts as lost earnings
Product Liability June 13, 2018 11:48 pm By Cat Fredenburgh | Melbourne

The High Court has said pensions can count as lost earnings, agreeing with a ruling from the Full Court of the Supreme Court of South Australia that found an individual dying from work-related mesothelioma was owed compensation for the expected loss of his  superannuation.

Arguments were heard by the High Court in February after special leave was granted to both Amaca Pty Ltd, formerly James Hardie Industries, and mesothelioma sufferer Gregory Latz, to argue the question of whether benefits count as compensable loss of earnings.  The appeal hearing was expedited to April, given Latz’s worsening condition.

In reasons published Wednesday, the High Court said the Full Court was correct to award Latz damages for the superannuation pension he would have received because superannuation benefits are linked to wages and are the product of the exploitation of a “capital asset”, the value of which was diminished by the injury caused by Amaca.

The Full Court’s ruling followed a finding by the lower court that Latz’s mesothelioma was caused by inhalation of asbestos dust emanating from products manufactured by Amaca.

“In these appeals, there is a clear and recognised injustice. As a result of Mr Latz’s injury, caused by Amaca, he will suffer an economic loss in respect of his superannuation pension. That loss is both certain and able to be measured by reference to the terms of the Superannuation Act – the net present value of the superannuation pension for the remainder of his pre-illness life expectancy, a further 16 years. He should be entitled to recover that loss,” the High Court said.

The High Court disagreed with the Full Court in part, saying Latz was not entitled to damages in relation to his age pension.

“The age pension stands in stark contrast. It is not part of remuneration. It is not a capital asset. It is not a result of, or intrinsically connected to, a person’s capacity to earn. Nor, contrary to Mr Latz’s submission, is it a future income stream to which he has any present or future right or entitlement. It is not a form of property even within the extended meaning given to that concept in the application of s51(xxxi) of the Constitution. No sum is to be allowed on account of the age pension in the calculation of damages for Mr Latz’s personal injuries,” the High Court said.

The High Court dismissed Latz’s appeal of the Full Court’s decision to reduce his damages award to take into account the reversionary pension that his partner will receive on his death under s 38(1)(a) of the Superannuation Act.

Latz is represented by Turner Freeman Lawyers.

Amaca is represented by Holman Webb.

The case is Amaca Pty Limited (Under NSW Administered Winding Up) v Latz; Latz v Amaca Pty Limited (Under NSW Administered Winding Up).

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Cat Fredenburgh

Cat Fredenburgh has been covering legal news for 12 years. She was previously Editor-in-Chief at US legal news publication Law360. She is the Co-Founder of Lawyerly.