Andrew Goodman v Impact Hire Australia Pty Limited

[2009] NSWSC 941

CITATION:	Andrew Goodman v Impact Hire Australia Pty Limited & Anor [2009] NSWSC 941
HEARING DATE(S):	7/09/09
JUDGMENT DATE :	11 September 2009
JUDGMENT OF:	Patten AJ at 1
DECISION:	See paragraph 27
LEGISLATION CITED:	Workers Compensation Regulation 2003; Workers Compensation Act 1970
CATEGORY:	Consequential orders
CASES CITED:	Chubs Construction Pty Ltd v Chamma [2008] NSWSC 382; Rushcutters Bay Smash Repairs Pty Ltd v H McKenna Net Makers Pty Ltd [2003] NSWSC 670; Corbett v Toll Stevedoring Pty Ltd & Ors [2007] NSWSC 749; H v State of NSW [2009] NSWDC 193; Baldwin v Lisicic [1993] NSWCA 18; O’Brien v McKean 118 CLR 540; Michel v Bullen (1818) 146 ER 749
TEXTS CITED:	Assessment of Damages for Personal Injury and Death- Professor Luntz; G E Dal Pont Law of Costs
PARTIES:	Andrew Goodman - Plaintiff Impact Hire Australia Pty Limited - First Defendant Inasmuch Pty Ltd - Second Defendant
FILE NUMBER(S):	SC 20438 of 2008
COUNSEL:	Mr A Stone - Plaintiff Mr J Catsanos - First Defendant Mr S Torrington - Second Defendant
SOLICITORS:	White Barnes Solicitors - Plaintiff Moray & Agnew - First Defendant Bartier Perry Pty Limited - Second Defendant

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IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

Patten AJ

11 September 2009

No: 20438 of 2008

Andrew Goodman
v
Impact Hire Australia Pty Limited & Anor

JUDGMENT

1 On 28 August, I published reasons in this matter and invited the parties to bring in agreed short minutes reflecting them. As it transpired not everything could be agreed upon and on 7 September outstanding matters were debated and are the subject of this judgment.

2 I am indebted to counsel for pointing out errors in paragraphs 2 and 174 of the reasons. Although the Nominal Defendant had been joined as a defendant by Mr Goodman, the proceedings against it had been dismissed by consent order dated 14 June 2007. The Nominal Defendant, represented by Mr Smith and NRMA Insurance Ltd, represented by Mr Renshaw, were before me as cross-defendants only.

3 The sum produced by the calculation referred to in paragraph 174 is correctly $464,553 and that amount should also be substituted for $464,534 in paragraph 176.

4 Mr Catsanos, who appeared on 7 September for Inasmuch agreed that the sum allowed against his client should include updated past treatment expenses which as at 28 August 2009 totalled $124,527.

5 In relation to past wages and superannuation loss, Mr Stone submitted that his client had been prejudiced by not being compensated in respect of the period between the date judgment was reserved viz 5 June and 7 September.

6 In Mr Stone’s submission damages should be assessed as at date of verdict and he referred to what was said by Barwick CJ in O’Brien v McKean 118 CLR 540 and to Professor Luntz, Assessment of Damages for Personal Injury and Death (Fourth Edition) at paragraph 1.4.6.

7 There is, I think, force in Mr Stone’s submission and I propose to accede to it. Although there was no evidence as to whether Mr Goodman has been in employment since 5 June, I think, in all the circumstances it may be inferred that he has not. Accordingly, I would propose to allow in the verdict to be awarded against both defendants the additional sum of $11,160 for wage loss and $1,227 for lost superannuation. Mr Stone did not seek any further “Fox v Wood” component.

8 In the reasons I calculated compensation for future diminished earning capacity in respect of a period up to Mr Goodman attaining the age of 65. I was required by statute to limit it in this way against Impact. In respect of Inasmuch, Mr Stone submitted that I should allow the loss up to age 67, principally in consequence of a statement by the Federal Government that it proposes to increase by 2 years the age at which a person otherwise entitled may receive an aged pension.

9 As Kirby P indicated in Baldwin v Silicic [1993] NSWCA 18 in the absence of specific evidence, it is appropriate to calculate future income loss up to the age upon which a person is “entitled by law to retire and receive an Australian pension. The was no such evidence in this case.

10 Mr Sone unsurprisingly was able to refer to little authority in support of his contention, the exception being the decision of Levy DCJ in H v State of NSW [2009] NSWDC 193 in which His Honour recognised normal retirement age “in current terms” as 67.

11 The law as it presently stands is that pensionable age is 65. Despite the government’s announcement it has not yet been translated into legislation and I do not think I should speculate upon the subject. It is not unknown for government announcements not to come to fruition, either at all or for many years.

12 The question of interest against Impact is governed by S151 M of the Workers Compensation Act in the following terms:

151M Payment of interest

(1) Limited statutory entitlement. A plaintiff has only such right to interest on damages as is conferred by this section.
(4)

(a) Interest is not payable (and a court cannot order the payment of interest) on damages unless:
(i) information that would enable a proper assessment of the plaintiff’s claim has been given to the defendant and the defendant has had a reasonable opportunity to make an offer of settlement (where it would be appropriate to do so) in respect of the plaintiff’s full entitlement to all damages of any kind but has not made such an offer, or
(ii) the defendant has had a reasonable opportunity to make a revised offer of settlement (where it would be appropriate to do so) in the light of further information given by the plaintiff that would enable a proper assessment of the plaintiff’s full entitlement to all damages of any kind but has not made such an offer, or
(iii) the defendant has made an offer of settlement, the amount of all damages of any kind awarded by the court (without the addition of any interest) is more than 20% higher than the highest amount offered by the defendant and the highest amount is unreasonable having regard to the information available to the defendant when the offer was made.


(b) The highest amount offered by the defendant is not unreasonable if, when the offer was made, the defendant was not able to make a reasonable assessment of the plaintiff’s full entitlement to all damages of any kind.

(c) For the purposes of this subsection, an offer of settlement must be in writing.

(5) Calculation of interest If a court is satisfied that interest is payable under subsection (4) on damages:

(a) the amount of interest is to be calculated for the period from the date of the death of or injury to the worker until the date on which the court determines the damages, and

(b) the amount of interest is to be calculated in accordance with the principles ordinarily applied by the court for that purpose, subject to this section.
(6) Rate of interest The rate of interest to be used in any such calculation is three-quarters of the rate prescribed for the purposes of section 101 of the Civil Procedure Act 2005 for the period concerned.
(7) Judgment debts Nothing in this section affects the payment of interest on a debt under a judgment or order of a court. “

13 It was common ground that no written offer of settlement was made on behalf of Impact within s151 M (4)(c) and no complaint has been made that Impact did not receive, in a timely fashion, proper particulars, medical reports etc. supporting Mr Goodman’s claim.

14 Mr Catsanos submitted that I should follow the decision of Studdert J in Corbett v Toll Stevedoring Pty Ltd & Ors [2007] NSWSC 749 and decline to order interest against Impact. In that case, which bears some similarity to the present, his Honour declined to order interest on the basis that within s151 M (4), it was not appropriate for the employer to make an offer of settlement. His Honour accepted submissions from counsel for the fourth defendant (employer):

“(i) the fourth defendant was only one of five defendants named in the proceedings and there were cross claims between the defendants, inter alia, seeking contribution under s 5(1)(c) of the Law Reform (Miscellaneous Provisions) Act 1946;
(ii) damages, if recoverable, against defendants other than the fourth defendant were to be assessed without the restraints imposed on the assessment of damages under the Workers Compensation Act. Restraints, of course, there are under the Civil Liability Act. However, the plaintiff, if successful against a defendant other than the fourth defendant, was going to recover appreciably more in that alternative claim. That, indeed, is what occurred here;
(iii) there is no evidence that the plaintiff would have accepted an offer from the fourth defendant limited to damages for economic loss had it been made and there was no evidence that any other defendant made an offer of settlement to the plaintiff or was willing to contribute to a settlement;
(iv) because of the cross claims, had the fourth defendant settled with the plaintiff that would not have concluded proceedings from its point of view;
(v) liability and contribution were contentious issues, as evidenced by the manner in which the trial was conducted.”

15 However, while this case bears some similarity to Corbett, there are important differences, including that in Corbett there were five defendants as opposed to two and what were described as “contentious” liability and contribution issues. While it is true that those matters were in issue during this trial, I would not categorise the issue of liability against Impact as particularly contentious, at least as the evidence unfolded before me. I think its negligence was gross.

16 It must have been apparent to parliament that s151 M contemplated situations where liability was in issue and other parties were involved. Nevertheless, it did not stipulate that the offer of settlement must resolve all issues between all parties. In this case, in my view, there may have been considerable utilitarian value in a settlement between Mr Goodman and Impact.

17 In my opinion, Mr Goodman has established an entitlement to interest in accordance with s151 M.

18 Mr Torrington did not submit otherwise than that his client is liable to pay interest.

19 So far as Impact is concerned, interest is to be calculated upon past economic loss due to loss of earnings. The relevant components total $283,813. From this sum before calculation of interest $122,156 must be deducted being the total of the Workers Compensation payments made to date viz $135,763 less “Fox v Wood” tax deducted of $13,607. This produces the sum of $161,657 upon which Mr Goodman is entitled to interest. The parties agreed that as against Impact, an appropriate interest rate would be 6.75% per annum; that the period is 5.66 years and that the product of that calculation should be divided by 2 to spread it over the period. The sum thus derived is $30,880, which I will allow as against Impact.

20 Against Inasmuch, the interest payable is regulated by s18 of the Civil Liability Act. Effectively, the interest is to be calculated upon the same sum as interest is calculated against Impact, viz $161,657. The parties agreed that 6% per annum would be appropriate. On this basis, I calculate interest at $27,449.

21 There remains the questions of costs. Both defendants concede that orders should be made against them. They contend, however, that each should only be ordered to pay 50% of the costs, reflecting my apportionment of liability. Although I adopted a similar procedure in Chubs Construction Pty Ltd v Chamma [2008] NSWSC 382 there was a particular reason for doing so in that case.

22 Mr Stone submitted that as a matter of well established principle the order should simply be that the defendants pay the Plaintiff’s costs. He referred to G E Dal Pont Law of Costs (second edition) at page 309 and authority, including Michel v Bullen (1818) 146 ER 749 and the more recent decision of Gzell J in Rushcutters Bay Smash Repairs Pty Ltd v H McKenna Net Makers Pty Ltd [2003] NSWSC 670.

23 It seems to me that the principle is correctly identified in Mr Stone’s submission and that there is no reason in this case to modify it. Both defendants should be held jointly and severally liable for the costs of the proceedings on a party and party basis. The authority for such an order against Impact is contained in clause 89 of the Workers Compensation Regulation as Impact’s final offer of settlement as certified by the mediator was “award for the Defendant each party to pay own costs”. In any event, as I have indicated, Mr Catsanos did not oppose the making of a costs order against his client.

24 In summary, therefore, I assess damages against Impact as follows:

Past wage loss $255,688
“Fox v Wood” component $ 13,607
Past loss of superannuation $ 28,125
Damages for future
impaired earning capacity $464,553
Loss of future superannuation $ 51,099
Interest $ 30.880
TOTAL: $843,952

25 In summary the damages I calculate against Inasmuch are:

Non economic Loss $225,000
Past wage loss $255,688
“Fox v Wood” component $ 13,607
Past Superannuation Loss $ 28,125
Past treatment expenses $124,527
Damages for future
impaired earning capacity $464,553
Loss of future superannuation $ 51,099
Future treatment $200,000
Past gratuitous
domestic services $ 77,960
Future paid household
Assistance $ 80,550
Interest $ 27,449
TOTAL: $1,548,558

26 In relation to Impact there will be verdict and judgment against it for the above amount of $843,952. The award of damages against Inasmuch requires modification in accordance with S151 Z of the Workers Compensation Act. Conveniently, such modification is achieved in this case by adding a sum equivalent to 50% of the damages assessed against Impact, to a sum equivalent to 50% of the damages assessed against Inasmuch. The calculation produces $1,196,255 and there will be a verdict against Inasmuch for that amount.

27 I make these orders:

1. Verdict and judgment against Impact in the sum of $843,952.
2. Verdict and judgment against Inasmuch in the sum of $1,196,255.
3. Declaration that orders 1 and 2 are not cumulative and that any satisfaction of either will pro tanto satisfy the other.
4. Declaration that Impact is entitled to be credited with Workers Compensation payments made to or for Mr Goodman.
5. Order that Impact and Inasmuch pay Mr Goodman’s costs as agreed or as assessed on a party and party basis.
6. Note that the costs payable by Impact are governed by Part 19 of the Workers Compensation Regulation 2003.
7. Liberty to apply in respect of any outstanding matter including the disposal of cross claims.
8. Exhibits may be returned.