AG Staff Pty Ltd v Filipowicz; Arnold Ribbon Co Pty Ltd v Filipowicz
[2012] VSCA 60
•4 April 2012
SUPREME COURT OF VICTORIA
COURT OF APPEAL
S APCI 2011 0032
| AG STAFF PTY LIMITED | |
| Appellant | |
| v | |
| STEFAN FILIPOWICZ | Respondent |
S APCI 2011 0035
| ARNOLD RIBBON CO PTY LTD | Appellant |
| v | |
| STEFAN FILIPOWICZ | Respondent |
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JUDGES: | MANDIE and BONGIORNO JJA, KYROU AJA | |
WHERE HELD: | MELBOURNE | |
DATE OF HEARING: | 21 March 2012 | |
DATE OF JUDGMENT: | 4 April 2012 | |
MEDIUM NEUTRAL CITATION: | [2012] VSCA 60 | |
JUDGMENT APPEALED FROM: | Filipowicz v Arnold Ribbon Co Australia Ltd; | |
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ACCIDENT COMPENSATION – Appeal against orders granting leave under s 134AB(16)(b) of the Accident Compensation Act 1985 to commence common law proceedings against two former employers – ‘Serious injury’ under s 134AB(37) – Legal principles for determining applications under s 134AB(16)(b) where a subsequent injury aggravates an earlier injury – Trial judge erred in taking the cumulative consequences of both injuries and deciding whether they satisfied the statutory test by reference to whether they each materially contributed to those consequences – Appeals allowed – County Court orders set aside and proceedings remitted to County Court for rehearing – Accident Compensation Act 1985, ss 134AB(16)(b), (17), (37), (38), 134AD; County Court Act 1958, s 74 - Grech v Orica Australia Pty Ltd (2006) 14 VR 602 explained – Petkovski v Galletti [1994] 1 VR 436 applied.
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| APPEARANCES: | Counsel | Solicitors |
| For the Appellant AG Staff Pty Ltd | Mr M F Wheelahan SC and Mr S A O’Meara SC | Wisewould Mahony |
| For the Appellant Arnold Ribbon | Mr J Ruskin QC and Mr J P Gorton SC | Thomsons Lawyers |
| For the Respondent | Mr R P Gorton QC with Mr M A Nightingale | Patrick Robinson & Co |
MANDIE JA:
I have had the benefit of reading in draft the reasons for judgment of Kyrou AJA and I agree that the appeals should be allowed for the reasons stated by his Honour. I would only add the following.
Senior counsel for the respondent submitted that the ultimate conclusions of the learned trial judge in relation to the Arnold injury were correct because the evidence showed that the Arnold injury was a cause of all of the pain and suffering consequences and loss of earning capacity consequences that the respondent was suffering at the time of trial. In that regard, senior counsel contended that the respondent had been rendered vulnerable by the Arnold injury to all of the consequences that became apparent after the AG injury. However, that was not the basis upon which the case was conducted at trial and it was not determined by the judge whether the evidence supported such an analysis. Indeed, because of the way that the case was presented, the evidence was not investigated from that perspective.
Senior counsel for the respondent further submitted that the evidence supported the conclusion reached by the judge that the AG injury was the cause of serious injury consequences insofar as loss of earning capacity was concerned. Senior counsel conceded, having regard to the way that the case was conducted, that it was not possible to disentangle the pain and suffering consequences of the AG injury from the pain and suffering consequences of the Arnold injury. However, he pointed out that s 134AB(17) did not prevent a worker who obtained leave to bring proceedings under s 134AB in relation to loss of earning capacity from also seeking to recover damages for pain and suffering in such proceedings (whereas the reverse position was excluded by s 134AB(17)). In the light of that, senior counsel submitted that the evidence supported the conclusion that the AG injury had caused the respondent a total loss of earning capacity. However, for the reasons stated by Kyrou AJA, I do not think that the judge correctly approached that question and it is not possible for this Court to determine that issue.
I therefore agree that both appeals must be remitted to the County Court
for re-hearing by another judge.
BONGIORNO JA:
I agree with Kyrou AJA.
KYROU AJA:
Introduction and summary
These are two appeals from orders made by a County Court judge on 21 February 2011 to grant leave to Stefan Filipowicz to commence common law proceedings against his former employers, Arnold Ribbon Co Australia Ltd (‘Arnold’) and AG Staff Pty Ltd (‘AG’). The orders were made pursuant to s 134AB(16)(b) of the Accident Compensation Act 1985 (‘Act’) and were in respect of both pain and suffering and loss of earning capacity damages. Although there were two separate applications under the Act, the trial judge delivered a single set of reasons.[1] The separate appeals by Arnold and AG were heard together by this Court.[2]
[1]Filipowicz v Arnold Ribbon Co Australia Ltd; Filipowicz v AG Staff Pty Ltd [2011] VCC 287 (21 February 2011) (‘Reasons’).
[2]Leave to appeal was not required: see s 134AC of the Act.
The application against Arnold related to an injury to Mr Filipowicz’s right shoulder which he claimed that he sustained on 26 August 2003 in performing his duties as a fitter, turner and welder, when he lifted a heavy steel bar (‘Arnold injury’). The application against AG related to an aggravation of the shoulder condition which Mr Filipowicz claimed he sustained in July 2006 while lifting a metal bar in the course of his employment (‘AG injury’). Pursuant to para (c) of the definition of ‘injury’ in s 5(1) of the Act, an aggravation of a pre-existing injury is itself an injury.
At the trial, it was not in dispute that Mr Filipowicz suffered compensable injuries in the course of his employment with Arnold and AG, respectively. What was in contention was whether Mr Filipowicz suffered a ‘serious injury’, within the meaning of para (a) of the definition of that term in s 134AB(37) of the Act, as a result of each of those compensable injuries. Paragraph (a) provides that a ‘serious injury’ means ‘permanent serious impairment or loss of a body function’.
The trial judge found that, at the time of the trial, Mr Filipowicz satisfied both the pain and suffering and the loss of earning capacity requirements in s 134AB(38) of the Act for the purposes of the definition of serious injury. His Honour also held that, as each injury ‘materially contributed to the ultimate consequences’, Mr Filipowicz was entitled to commence common law proceedings against Arnold and AG.[3]
[3]Reasons, [103].
The key issue in both appeals was whether the trial judge applied the wrong legal test. For the reasons that follow, I have concluded that his Honour did so. His Honour wrongly concluded that his approach was sanctioned by Grech v Orica Australia Pty Ltd[4] and that he was not obliged to follow the principles set out in Petkovski v Galletti.[5]Accordingly, I would allow the appeals, set aside the County Court orders and remit the proceedings to the County Court for rehearing by another judge.
[4](2006) 14 VR 602 (‘Grech’).
[5][1994] 1 VR 436 (‘Petkovski’).
Facts
Mr Filipowicz was born on 20 August 1962 and worked as a fitter, turner and welder in Poland, Germany and New Zealand before joining Arnold in 1999. Following the Arnold injury, Mr Filipowicz returned to work in restricted duties in September 2003 and, after that time, he was on and off work until his employment was terminated in August 2004.
Mr Filipowicz continued to complain of pain to his right shoulder and was prescribed pain relieving medication. On 13 July 2004, an orthopaedic surgeon, Mr Michael Dooley, performed surgery on Mr Filipowicz’s right shoulder. Mr Dooley found hypertrophy of the distal end of the clavicle and degenerative change affecting the acromioclavicular joint. He excised the outer rim of the clavicle.
Between September 2004 and January 2006, Mr Filipowicz worked on a full-time basis and on unrestricted duties for six different employers. Although these jobs involved heavy work, at the time that he was employed, Mr Filipowicz did not tell the various employers about any problems with his right shoulder.
On 16 January 2006, Mr Filipowicz commenced work with AG without mentioning any problems with his right shoulder. The work that he performed for AG was full-time and very heavy, requiring lifting, carrying, manhandling and holding steel parts weighing up to 50 kilograms. Following the AG injury, Mr Filipowicz ceased working for AG on 25 July 2006. He has not worked since that time.
On 8 August 2006, an orthopaedic surgeon, Mr Peter Kudelka, noted degenerative changes in the acromion process of the scapula. On 31 August 2007, an occupational health and rehabilitation consultant, Dr David Middleton, diagnosed right acromioclavicular joint subluxation.
In each of the financial years between 1 July 2000 and 30 June 2006, Mr Filipowicz’s gross annual earnings from personal exertion ranged from $30,830 to $35,174.
At the trial, there was contested evidence about Mr Filipowicz’s capacity for ‘employment in work for which [he was] … suited (whether or not that work [was] available)’.[6]
[6]See the definition of ‘suitable employment’ in s 5(1) of the Act.
Decision of the County Court
The trial judge referred to a number of passages in the judgment of Ashley JA in Grech[7] and focussed, in particular, on the following statement:
[I]t cannot be doubted that compensable injury may be sustained which does not have present consequences yielding an entitlement to compensation. Indeed, an injury may never have such consequences. Again, it is quite possible – it will be a matter for determination according to the evidence in the particular case – that each of two or more compensable injuries is a legally sufficient cause of the same consequences.[8]
[7](2006) 14 VR 602.
[8](2006) 14 VR 602, 616 [57].
The trial judge continued:
The latter observation [of Ashley JA] is apposite to the evidence in this application. I have found that the evidence supports the conclusion that with each employer the plaintiff suffered a compensable injury. The first employment materially contributed to consequences which were worsened by the second employment, which also materially contributed to the ultimate consequences, which amount to satisfaction of the statutory test for pain and suffering and loss of earning capacity.[9]
[9]Reasons, [103].
The trial judge quoted from Ashley JA’s discussion of the concept of ‘material contribution’ as it relates to the Act and emphasised the following passage:
[T]he Act, as with its predecessors, contemplates that a consequence may have a multiplicity of causes, including a multiplicity of compensable injuries.[10]
[10]Grech (2006) 14 VR 602, 617 [58].
The trial judge continued:
The critical importance of what [Ashley JA] said ties in with what I quoted from his Honour’s judgment earlier; that is, that if the consequences to the plaintiff in this application have been materially contributed to by the compensable injuries, then in accordance with his Honour’s reasoning, that is sufficient, as a matter of law. On the facts as I have found them to be, both employers are responsible for the plaintiff’s present pain and suffering consequences and loss of earning capacity consequences.[11]
[11]Reasons, [105] (citation omitted).
The trial judge rejected the proposition that he was obliged to apply the principles in Petkovski, which required that a separate assessment be made of whether each injury produced consequences that satisfied the definition of ‘serious injury’ in s 134AB(37) of the Act, as amplified by s 134AB(38). His Honour stated:
As I see it, the distinction between Petkovski on the one hand, and Grech on the other, is that the facts on which Petkovski was based arose from a transport accident and not an industrial accident. A comparison between the Transport Accident Act 1986 and the Act demonstrate[s] that what [Ashley JA] referred to as the language of the Act and its history of interpretation, is absent from the Transport Accident Act 1986.
…
The principle referred to in Petkovski is seductive and it is understandable why it has been applied in industrial accident cases brought under s 134AB. It is based upon the common law principles relevant to the assessment of damages where a person seeking damages had a prior condition which was aggravated by an incident upon which the common law claim is based.[12]
[12]Reasons, [110], [112].
The trial judge considered Guppy v Victorian WorkCover Authority[13] and concluded that that case recognised that Grech was good law.[14] His Honour considered that he was bound by the reasoning of Ashley JA in Grech.[15]
[13][2010] VSCA 164 (25 June 2010) (‘Guppy’).
[14]Reasons, [114].
[15]Reasons, [115].
Grounds of appeal
Arnold and AG filed similar Notices of Appeal. Their main ground of appeal was that, in purporting to follow Grech and refusing to apply Petkovski, the trial judge failed to properly give effect to the provisions of the Act. A second common ground of appeal was that the trial judge’s finding that Mr Filipowicz suffered a total loss of earning capacity was not open on the evidence. A third ground of appeal that was pursued by AG alone was that the trial judge’s reasons were inadequate.
Did the trial judge apply the wrong legal test?
Section 134AB was enacted against a background of similar schemes in s 135A of the Act and s 93 of the Transport Accident Act 1986 (‘TA Act’). Section 134AB(38)(b) and (c) essentially codified Humphries v Poljak,[16] which concerned s 93 of the TA Act.
[16][1992] 2 VR 129, 140.
Petkovski also concerned s 93 of the TA Act. The Appeal Division held that, in the case of a pre-existing condition, ‘an analysis must be made of the extent of impairment of a body function before and after the relevant injury’, and the claimed aggravation must itself be a ‘serious injury’.[17] The Appeal Division confirmed the clear intention of Parliament not to permit minor aggravations to attract a grant of leave.[18]
[17][1994] 1 VR 436, 444.
[18][1994] 1 VR 436, 444.
Petkovski has been applied by this Court to s 135A of the Act.[19] Petkovski, and its application to s 134AB, were affirmed in Guppy.[20]
[19]See RJ Gilbertsons Pty Ltd v Skorsis (2000) 12 VR 386, 388 [2], 395 [28]-[29], 398 [40] (‘Skorsis’); Lu v Mediterranean Shoes Pty Ltd (2000) 1 VR 511, 520 [27] (‘Lu’).
[20][2010] VSCA 164 (25 June 2010) [18]-[19]. See also Doolan v Rayners Sawmills Pty Ltd [2008] VSCA 219 (28 November 2008) [71] (‘Doolan’).
Grech dealt with causation issues in the context of a single ongoing condition (bilateral carpal tunnel syndrome) which commenced prior to 20 October 1999 and continued after that date. The question for determination was whether the worker had suffered identifiable compensable injury to his wrists and hands on or after 20 October 1999,[21] which resulted in or materially contributed to the consequences that he claimed constituted serious injury.[22] The case did not involve two separate injuries arising out of two discrete incidents, where the subsequent injury aggravated the earlier injury. There is nothing in Grech which detracts from the principles in Petkovski.
[21]See ss 134A(1) and 134AB(1) of the Act.
[22](2006) 14 VR 602, 604 [1], 605 [3], 621 [79].
Accordingly, for the purposes of s 134AB of the Act, an aggravating injury must itself qualify as a serious injury.
As it was common ground that Mr Filipowicz had suffered two separate compensable injuries on or after 20 October 1999, the trial judge should have determined the applications for leave to commence common law proceedings against Arnold and AG in the following manner.
First, his Honour should have identified each injury.[23]
[23]Dalton v Dandenong Scaffolding Hire CoPty Ltd [2003] VSCA 183 (20 November 2003) [14], [38]-[39] (‘Dalton’); Grech (2006) 14 VR 602, 614 [45], 616 [54].
Secondly, his Honour should have delineated the impairment consequences of each injury.[24]
[24]Dalton [2003] VSCA 183 (20 November 2003) [14], [39], [47], [49]; Lu (2000) 1 VR 511, 520-1 [27]-[28]; Doolan [2008] VSCA 219 (28 November 2008) [71].
Thirdly, in the case of the AG injury, which, although an aggravation of the Arnold injury, was a separate injury, his Honour should have determined whether the injury qualified as a serious injury under s 134AB(37) of the Act as amplified by s 134AB(38).[25]
[25]Guppy [2010] VSCA 164 (25 June 2010) [18].
Fourthly, in determining whether Mr Filipowicz had discharged the onus of establishing that the AG injury was a serious injury, his Honour should have made a comparison between Mr Filipowicz’s condition before the AG injury and his condition after the AG injury, and should then have made an assessment of the additional impairment.[26]
[26]Skorsis (2000) 12 VR 386, 388 [2], 395 [28]-[29], 398 [40]; Guppy [2010] VSCA 164 (25 June 2010) [18]-[19]; De Agostino v Leatch [2011] VSCA 249 (30 August 2011) [9], [11]; Lu (2000) 1 VR 511, 520 [28].
Fifthly, as the two injuries arose from separate incidents, they could not be accumulated. The AG injury had to satisfy the requirements of a ‘serious injury’ in its own right rather than in combination with the Arnold injury.[27]
[27]Petkovski [1994] 1 VR 436, 444; Angeletos v Museum of Victoria [1999] 3 VR 157, 168 [23]; Lu (2000) 1 VR 511, 520 [27]; Altona Bus Lines v Lococo [2002] VSCA 159 (30 September 2002) [7].
The trial judge failed to address Mr Filipowicz’s impairment as a result of the AG injury in accordance with the above principles. His Honour took the cumulative consequences of both injuries and assessed them as satisfying the statutory test. In doing so, he fell into error. Senior counsel for Mr Filipowicz conceded that his Honour erred in failing to apply Petkovski to the AG injury.
The trial judge fell into error because of the manner in which senior counsel for Mr Filipowicz at the trial (not the senior counsel who appeared for him before this Court) presented his case. In his opening address, senior counsel for Mr Filipowicz submitted to his Honour that the case was ‘fairly simple in terms of the principles’ because Mr Filipowicz’s ‘current state … satisfies the serious injury test and both [injuries] are causatively linked in a materially relevant way’. Senior counsel adduced evidence consistently with this approach. For example, senior counsel asked Dr Middleton whether ‘there is a material contribution from the 2003 trauma to [Mr Filipowicz’s] shoulder’ and whether ‘there is a material contribution or a causative link between how [Mr Filipowicz] is now and the 2006 aggravation’.
The trial judge’s error in accumulating the effects of both injuries and asking himself whether each injury materially contributed to the ultimate consequences infected the entirety of his Honour’s judgment. His Honour did not analyse the medical evidence in order to assess Mr Filipowicz’s condition, both before and after the AG injury, against the requirements of s 134AB(38) of the Act. Indeed, the manner in which senior counsel for Mr Filipowicz adduced the medical evidence was not conducive to such an assessment.
In this Court, senior counsel for Mr Filipowicz submitted that, notwithstanding the trial judge’s error in failing to apply Petkovski to the AG injury, his Honour’s decision was consistent with the Act. He contended that, as the Arnold injury rendered Mr Filipowicz’s shoulder unstable and vulnerable to further deterioration from ongoing work activities, it was a cause of the aggravation consequences arising from the AG injury. Further, so it was said, although the Arnold injury caused a loss of earning capacity that was sufficient for the purposes of the Act, the aggravation from the AG injury increased that loss to a total loss. On this basis, counsel submitted, both injuries satisfied the serious injury requirements of the Act.
These submissions must be rejected.
First, the submissions do not reflect the manner in which the case was conducted or decided at trial.
Secondly, it is by no means clear that the evidence supports the submissions. For example, Mr Filipowicz gave evidence that, when he commenced working at AG, his shoulder ‘was [one] hundred per cent recovered’ and that he did not take pain relieving medication daily. The medical evidence relating to the effects of the Arnold injury was inconclusive. It was common ground that Mr Filipowicz worked for six different employers between his employment with Arnold and his employment with AG. There was also evidence from which it could be concluded that, after the AG injury, the plaintiff was capable of performing some work for which he was suited.
The present case is unlike Altona Bus Lines v Lococo.[28] In that case, this Court held that, when the reasons of the trial judge were read as a whole, it was evident that the judge concluded that the effect of an earlier injury considered alone was to produce consequences that satisfied the definition of ‘serious injury’, albeit that the judge expressed that conclusion in a ‘somewhat elliptical manner’.[29] In the present case, a fair reading of the trial judge’s reasons indicates that his Honour failed to engage with the provisions of s 134AB(37), as amplified by s 134AB(38), in relation to either the Arnold injury or the AG injury, due to his misapprehension of the applicable legal principles.
[28][2002] VSCA 159 (30 September 2002).
[29][2002] VSCA 159 (30 September 2002) [10].
It follows that the trial judge’s decision is vitiated by a specific error of law.
Before this Court, there was some debate about whether the repeal of s 134AD of the Act, with effect from 10 December 2009,[30] meant that it could not apply to these appeals. Although the two injuries and the impairment assessment by the Victorian WorkCover Authority pre-dated the repeal of s 134AD,[31] the commencement of the County Court proceedings post-dated the repeal.[32] It is not necessary for me to decide the effect of the repeal of s 134AD because, even if s 134AD had not been repealed, it would not apply to these appeals. This is because in Dwyer v Calco Timbers Pty Ltd,[33] the High Court held that, where an appeal turns on issues respecting misconstruction or misapplication of relevant provisions of the Act, as in the present case, s 74 of the County Court Act 1958 applies.[34]
[30]See ss 2(5) and 60 of the Accident Compensation Amendment Act 2010.
[31]The Victorian WorkCover Authority made its assessment on 7 April 2009.
[32]The County Court proceedings were commended on 21 December 2009.
[33](2008) 234 CLR 124, 135 [31], 136 [33].
[34]See also Kovacic v Henley Arch Pty Ltd (2009) 22 VR 21, 23 [4]; Filipovski v Ogemi Services Pty Ltd (2009) 25 VR 316, 317 [2], 339-41 [98]-[109], 350-3 [165]-[179].
Even if it were otherwise appropriate for this Court to decide for itself whether Mr Filipowicz satisfied the serious injury requirements of the Act in relation to each injury, it is not possible for this Court to perform this task in relation to the two appeals. This is because the evidence relating to the two injuries is intertwined and cannot be untangled.
For the above reasons, I would allow both appeals, set aside the County Court orders and remit the proceedings to the County Court to be reheard by another judge.
Other grounds of appeal
My conclusion at [47] above means that it is not necessary for me to consider the other grounds of appeal. However, for completeness I will briefly set out my views on those grounds and how they support that conclusion.
I am satisfied that the trial judge’s reasons for decision are inadequate because they do not set out his Honour’s path of reasoning in relation to his critical finding that, following the AG injury, Mr Filipowicz ‘suffered increased pain and incapacity for work as a result, by inference, further incapacity with respect to domestic and recreational pursuits’.[35] Apart from stating that he accepted Mr Filipowicz’s evidence, the trial judge did not explain the evidentiary basis for this finding. Further, it is not clear how the evidence, which intermingled the consequences of the two injuries, could justify such a finding.
[35]Reasons, [89]. See s 134AE of the Act, which requires a court deciding an application under s 134AB(16)(b) to give detailed reasons. See also ACN 005 565 926 Pty Ltd v Snibson [2012] VSCA 31 (29 February 2012) [78]-[82].
There is also substance in the submissions of Arnold and AG that, in concluding that Mr Filipowicz suffered a total loss of earning capacity, the trial judge failed to have proper regard to some of the evidence. For example, his Honour’s finding that a video depicting four different jobs showed ‘almost nothing in terms of identifiable tasks’[36] is not borne out by the contents of the video. It is also not apparent how the trial judge related the provisions of s 134AB(38)(e) to (g) to the evidence.
[36]Reasons, [95].
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