A bus driver from Canberra has been awarded more than $400,000 by the ACT Supreme Court, after being traumatised during an Australian Defence Force (ADF) exercise.

The 55-year-old man who is originally from Yugoslavia, claimed he had been left with mental health problems after seeing a simulated massacre scene, at a training area in the Blue Mountains.

The man had been employed to drive a bus for cadets taking part in the exercise.

The ADF said he had been warned about what he would see, but the man said he had not been warned and has been traumatised since.

His symptoms have included recurrent visions, difficulty driving and he suffers sleep problems and nightmares.

Justice Anthony Besanko found the man had suffered a shock reaction and awarded him compensation to cover loss of earnings as well as non-economic loss.