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Loss of earning capacity

Assessing damages to compensate a plaintiff for earnings lost before the trial is reasonably straightforward because all the facts are known. The usual principle of full compensation is applied, though in calculating loss of earnings Australian courts take net earnings into account, not gross earnings.

The amount of damages for earning capacity that will be lost after the trial is more difficult to calculate. The award has to be based on an estimate of what may happen in the future, comparing that figure with an estimate of what might have happened had the plaintiff not been injured.

Todorovic v Waller (1981) 150 CLR 402.