On 3 September 2025 in Stewart v Metro North Hospital and Health Service [2025] HCA 34, the High Court of Australia revisited the compensatory principle in the context of damages for personal injury. The Court unanimously confirmed that ‘The compensatory principle in tort entitles the injured party to compensation in a sum which, so far as money can do, will put that party in the same position as they would have been in if the tort had not been committed.’ The compensation award must also be reasonable. But how is reasonableness to be determined?
Mr Stewart had been living at home with his brother and two dogs and his son would often come and stay. Then he was catastrophically injured by the negligence of Redcliffe Hospital. He suffered bowel perforations, sepsis, cardiac arrest and stroke and was left with brain damage, a paralysed right arm, colostomy bag, right leg contractures and pain on the right side of his body. After the medical negligence he ended up in a nuring home where he could not have a dog and was miserable. Family members had to give advance notice to be able to visit him.
Mr Stewart sought compensation in an amount that would allow him to be cared for at home as he used to live before becoming a victim of medical negligence. Redcliffe Hospital argued it should not have to compensate Mr Stewart in an amount that would allow him to live at home as he used to and that he should only be entitled to compensation so that he could live in the nursing home with additional therapy from external providers.
The trial judge in the Supreme Court of Queensland had allowed the cost of nursing home fees plus additional therapy from external providers but had refused to allow the increased costs of being cared for in his own home. The trial judge decided the increased cost of being supported at home was unreasonable, so did not allow it. The Queensland Court fo Appeal upheld this decision by the trial judge.
The High Court then unanimously concluded that the way the reasonableness test was applied at trial and in the Queensland Court of Appeal was erroneous. The way the reasonableness test should be applied is for the Court to consider whether Mr Stewart’s preferred choice to live at home, rather than be miserable in a nursing home, was a reasonable choice. If it was, then Redliffe Hospital would simply have to pay for it and it was not relevant whether the increased benefits of home care were good value compared to the nursing home care.
This decision is a win for innocent people injured by medical negligence or in motor accidents, work injuries and other forms of public or professional liability. It will be applicable in cases involving very expensive prosthetics where a prosthetic limb will assist with putting the injured person in as close to the same position as they would be in if not injured. So long as the choice to use the particular prosthetic limb is reasonable, and there is no unreasonableness in the choice that unecessarily increases the costs involved, the injured person should receive the compensation. A defendant may still have success in arguing though that another device that acheives as good an oucome is cheaper.
An injured plaintiff should were relevant always argue that a better and likely more expensive care regime will ameliorate reduction in life expectancy due to a lower standard of care a defendant will likely be arguing for.
An injured plaintiff still has a duty to take reasonable steps to mitigate their loss. However, what is reasonable in a particular case will depend on the relevant plaintiff and what it would be reasonable to expect them to do.
The plaintiff bears the onus of proof to show that their choice is reasonable. The defendant bears the onus of proof to show the plaintiff’s choice involves a failure to take reasonable steps to mitigate the loss. A plaintiff must prove the reasonable cost of their choice and cannot simply argue for the most expensive version of something where a cheaper equivalent is readily available. A plaintiff is entitled to compensation for a remedial procedure even if there is a risk it will make their condition worse. However, a plaintiff is not entitled to compenstion for something they would not actually use, or if the benefit would only be slight or speculative.
An example provided by the High Court was a plaintiff who had been prevented from conceiving children by a defendant due to a sterilisation injury. The plaintiff may be entitled to the cost of overseas surrogacy for the number of children they would have had if they had not been injured.
The High Court also found that in 2025, the exercise of a person’s autonomy of choice will usually be assocaited with mental well-being. It is erroneous to only consider whether the increased cost of a plaintiff’s choice is a good value way to acheive the likely benefit to their health.
Where compensation for pain and suffering is calculated under a statutory scheme such as is generally the case in Queensland, and the amount awarded is based on the plaintiff’s level of function, that is a relevant context for the application of the compensatory principle. A defendant cannot succeed in arguing that additional pain and suffering caused by an unreasonable care scheme is encapsulated in a functional based pain and suffering award.