Bailey v Peakhurst Bowling and Recreation Club Ltd
[2009] NSWDC 284
•3 November 2009
CITATION: Bailey v Peakhurst Bowling & Recreation Club Ltd [2009] NSWDC 284 HEARING DATE(S): 24, 25 and 26 August 2009
JUDGMENT DATE:
3 November 2009JURISDICTION: Civil JUDGMENT OF: Levy SC DCJ DECISION: 1. Verdict and judgment for the plaintiff in the sum of $507,550;
2. Defendant to pay the plaintiff’s costs.CATCHWORDS: TORTS – employer’s liability – claim of workplace bullying, intimidation and harassment of bar employee by club manager - DAMAGES – severe psychological injuries – post-traumatic stress disorder – inability to work – whether defendant has demonstrated that plaintiff has unreasonably failed to mitigate her damage – assessment of economic damages. LEGISLATION CITED: Workers Compensation Act 1987
Workplace Injury Management and Workers Compensation Act 1998
Club Employees (State) Award NSWCASES CITED: Fazlic v Milingimbi Community Inc [1982] HCA 3; (1982) 150 CLR 345
Husher v Husher [1999] HCA 47; (1999) 197 CLR 138
Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298
Kallouf v Middis [2008] NSWCA 61PARTIES: Carol Anne Bailey (Plaintiff)
Peakhurst Bowling & Recreation Club Ltd (Defendant)FILE NUMBER(S): 1362 of 2009 COUNSEL: Mr M Perry (Plaintiff)
Mr H Halligan (Defendant)SOLICITORS: De Luca-Leonard (Plaintiff)
Edwards Michael Lawyers (Defendants)
JUDGMENT
Nature of case
1. The plaintiff seeks damages from her former employer for workplace negligence. She claims to have suffered severe psychological injury following a course of bullying and harassment by her supervisor at work. She claims the conduct concerned was carried out by Mr Tony Riley who was at the relevant time a director of the defendant club and also her employment supervisor. The plaintiff claims that her resultant psychological injury has permanently prevented her from resuming any form of remunerative employment.
Issues for determination
2. At the commencement of the trial all issues were in contest however during discussions, after the commencement of the hearing, the parties reached an agreement that has resulted in an admission of liability by the defendant. The defendant has conceded that it owed the plaintiff a duty of care that required it to provide the plaintiff with a safe place and system of work. The defendant has also conceded that it breached that duty of care with the consequence that such breach caused the plaintiff to suffer a psychological injury that has resulted in a psychiatric disorder. The question of the plaintiff’s entitlement to damages remains to be assessed within the circumscribed assessment constraints imposed by s 151G of the Workers Compensation Act 1987, namely economic damages.
Assessed heads of damage
3. The plaintiff’s claim was limited to the following five heads of damage :
Head of Damage
Paragraphs (a) Past loss of earning capacity [74] - [80] (b) Future loss of earning capacity [81] - [91] (c) Past loss of superannuation [92] (d) Future loss of superannuation [93] (e) Fox v Wood [94]
4. The plaintiff’s damages were assessed in the sum of $507,550. My reasons for this assessment follow in the ensuing paragraphs.
Credit issues
5. In my view the plaintiff was a most credible witness. Notwithstanding that the subject matter of the proceedings was undoubtedly greatly distressing to her she gave her evidence in a measured and dignified manner. Although liability was admitted the defendant did not call Mr Riley to give any evidence on the critical matters described by the plaintiff in her evidence. The absence of any evidence from Mr Riley was not explained. I infer from the evidence of the plaintiff that Mr Riley was in a position to give an account of the pivotal events in question as they impacted on the plaintiff from a psychological perspective in the workplace. I infer from these circumstances that there was nothing that Mr Riley could have added that would have advanced the defendant’s position in the litigation : Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298. Accordingly, I accept the evidence the plaintiff gave concerning her history and concerning the critical events in question that occurred in the workplace. I also accept as truthful her evidence of the adverse effect those events have had upon her health and upon her capacity to resume and to continue employment. I am reinforced in my view as to her credit since the defendant called no evidence that relevantly contradicted her evidence which I found inherently credible. I find the plaintiff was a truthful witness.
Facts
The plaintiff
6. The plaintiff was born in 1957 and grew up in the Bankstown area of western Sydney. She was aged 52 years at the time of the hearing. She is married and has two adult children. It is relevant to set out the plaintiff’s employment history in some detail.
Plaintiff’s employment history
7. In 1972 she left school in her 15th year to enter the workforce. Thereafter, and until January 1980 she was continuously employed in various positions as a shop assistant and as a clerk. This period of employment ceased when the time approached for her to deliver her first child.
8. In about 1982 and until mid-1987 the plaintiff re-entered the workforce and pursued employment variously as a bank teller, shop assistant and waitress. She worked for about 20 to 25 hours per week during this time. This period of employment ceased when the time approached for her to deliver her second child.
9. In 1989 the plaintiff again re-entered the workforce this time in the hospitality industry. Thereafter she worked as a bar steward for a soccer club. That employment continued until 1998, which was when that club went into liquidation. During that employment the plaintiff worked an average of 30 hours plus per week and attained the position of Supervisor Level 5 pursuant to the Club Employees (State) Award NSW.
10. In early 1998 the plaintiff commenced employment with the defendant as a casual bar steward. Her duties comprised general bar work, poker machine attendant and the balancing of floats and takings. She resigned that employment after one month because she was uncomfortable about some of the practices she had observed at the defendant’s club. She described those practices as “rorting” and her evidence in that regard was not challenged or contradicted. She then took concurrent employment as a bar steward at a nearby RSL club and at a bowling club for an average of 30 hours per week which provided her with an income of $600 per week net. In these jobs she worked at the classification Supervisor Level 5. She left that work because it involved too much night work and she wanted different working hours for her shifts.
11. In June 1998 the plaintiff then recommenced employment with the defendant as a casual bar steward and her duties also included some cellar work. Her working hours were according to a fixed roster. She continued in this employment until the end of May 1999. In this period the plaintiff worked an average of 31 hours plus per week in a set roster of hours comprising 2.00pm to 8.00pm Mondays, 6.00am to 10.00am Wednesdays, 11.30am to 5.30pm on other week days, 8.30am to 5.30pm on Saturdays and 2.30pm to 8.30pm on Sundays.
12. At the end of May 1999 the plaintiff resigned her employment with the defendant in order to work concurrently at a nearby RSL club and at a nearby bowling club where in both clubs she was again classified as a Supervisor Level 5. She continued in this work until May 2000. Her resignation from the employment with the defendant also proved to be temporary on this occasion.
13. On 28 May 2000 the plaintiff was again re-employed by the defendant as a bar steward. In addition, for a number of months she also worked concurrently at a nearby RSL club for one shift per week. On the resumption of her employment with the defendant the plaintiff essentially worked the same rostered shifts as she had worked for the defendant in her previous period of employment. In this employment her duties included balancing the takings from the till, counting money in the safe, some cellar work consisting of cleaning the beer lines and tapping beer kegs. She was also responsible for customer service including attending on Keno and poker machines. She also had the responsibility for the opening and closing procedures of the club. Her workdays were Mondays, Wednesdays, Thursdays and weekends. She worked an average of 30 hours per week. This arrangement continued until the cessation of her employment.
14. During this last period of her employment with the defendant, for award purposes she was classified as a Level 3 employee. Despite this, she nevertheless performed some supervisory work for the defendant.
Plaintiff’s incentive to keep working
15. The plaintiff and her husband, who was at the relevant time a storeman and packer, did not own their own home. They lived in rented accommodation and relied upon the plaintiff’s earnings to make ends meet. The plaintiff enjoyed bar work because it gave her an opportunity to interact with and communicate with people. I accept her evidence that she would have worked in this employment or in similar employment until at least age 65 years if not longer, health permitting.
Plaintiff’s pre-incident health
16. Apart from experiencing some childhood asthma, which caused her to miss some of her schooling and therefore leave school early, the plaintiff was in good general health before the events that gave rise to these proceedings. Relevantly, it transpired that she had some cause to consult her general practitioner sometime in early 2005 when she was experiencing anxiety over the instability of her accommodation arrangements as the lessor of the place she was renting had given her family a notice to quit as he wished to take up residence in the premises himself. Until that situation had resolved when she found alternative rental accommodation, the plaintiff took prescribed anti-depressant medication. The problem was obviously of short-term duration. The plaintiff had no other history of any emotional or psychological illnesses although that episode demonstrated that she had a vulnerability to illness from psychological stress.
Events which initiated the plaintiff’s claim against the defendant
17. Although the defendant has admitted liability it is relevant to set out the events which led to the plaintiff’s psychiatric illness in order to understand how these events have impacted upon her earning capacity.
18. In mid-2004, Mr Tony Riley, who was a patron and a director of the defendant club and who was a also contractor supplying services to the club, was appointed club chairman and as such he also became the immediate supervisor of the plaintiff. The plaintiff gave evidence that since that time she became the subject of a concerted campaign by Mr Riley that comprised workplace harassment, threats to continuity of her employment, intimidation and bullying.
19. I find that from late 2004 through until early 2006 the plaintiff became subjected to behaviour initiated by Mr Riley that is fairly described as harassment, intimidation and bullying. In particular, this behaviour consisted of repeated indications given to the plaintiff by Mr Riley that her job was precarious and that the defendant would “get rid of her.” Mr Riley also used extremely vulgar language both directly to her and in her presence. He also placed her in untenable situations where, as her direct supervisor, he pressured her and required her to bend or break the liquor licensing rules regarding the service of alcohol, gaming and accounting for sales. He also demanded that she resign her membership of the trade union to which she legitimately belonged. Mr Riley’s concerted and sustained behaviour towards the plaintiff along these lines came to the notice of a patron of the club who advised the plaintiff to keep a diary of relevant events in her own best interests. This proved to be good and valuable advice.
20. The plaintiff’s 2005 and 2006 diaries which were dedicated to documenting Mr Riley’s conduct towards her were admitted into evidence as Exhibits “J” and “K”. These diaries are corroborative of abusive behaviour by Mr Riley which I consider to have been of an intimidatory, harassing and bullying nature. The plaintiff explained, and I accept, that these diaries do not record each and every instance of Mr Riley’s misbehaviour because at times she felt matters were improving to some extent before they again deteriorated and this at times put her off her guard so that not all instances of the behaviour complained of were recorded in her diaries. I find that the plaintiff’s diaries are supportive and corroborative of her claims and complaints concerning the misbehaviour of Mr Riley towards her.
21. Matters came to something of a head at the plaintiff’s work on 27 October 2005 when a meeting took place at the club at which those present included the plaintiff, Mr Riley, Mr Canute who was another director and Mr Nikols who was the bar service manager who had also complained about the conduct of Mr Riley. Also present was Ms Ann-Marie Presland, an organiser from the plaintiff’s union. Mr Riley sought to intimidate the plaintiff by instructing her not to involve herself in the complaint made against him by Mr Nikols. In return, Mr Riley promised he would make only a minor change to her shift arrangements.
22. Following that meeting the staff and the union representative considered the outstanding industrial issues to have been resolved. However, over the ensuing weeks the interpersonal difficulties between the plaintiff, other staff members and Mr Riley continued. These difficulties concerned Mr Riley’s conduct with regard to the manner in which he addressed staff, including the plaintiff, capriciousness in the alteration of the staff working shifts, and the non-adherence to the prohibition on the self service of liquor at the bar. An example of the problems concerning shifts was that the plaintiff’s shifts were changed from daytime and nighttime, including on Christmas Eve. This occurred without consultation or discussion. The plaintiff was made to feel uncomfortable by Mr Riley’s contravention of the dress code. He caused the plaintiff to panic needlessly and become anxious and upset when he wrongfully implied that she was responsible for a $2000 shortage in the cash float when in fact there was no such shortage and he knew this to be the case. The significance of this instance was that the plaintiff believed, reasonably, that she could be accused of stealing and dismissed from her job. On another occasion she had to deal with the fact that Mr Riley had disrespected her when she had walked in on him and other persons present in the club watching a pornographic film which he initially refused to turn off in her presence, dismissing the suggestion that it be turned off by stating “Oh it doesn’t matter, it’s only Carol” before he was eventually forced to turn it off.
23. Another example of poor treatment that Mr Riley meted out to the plaintiff was to effect a change in her work classification from casual to permanent part-time with a lesser hourly rate of pay and with a loss of 5½ years of seniority which resulted in her being relegated to a probationary position. These events distressed her greatly. Mr Riley further needlessly stressed the plaintiff by wrongly asserting that she had signed a paper agreeing to such changes when he knew that she had not done so.
24. Other events led to the plaintiff and other staff members contacting their union representative for assistance in dealing with what was a difficult and industrial situation.
25. These events culminated in a meeting scheduled to take place at the club at which the union representative, Ms Presland, the plaintiff, Mr Riley, Mr Canute and all other staff members were to attend for the purpose of attempting resolution of the ongoing staff management problems at the club. The meeting was initially convened on 6 January 2006 with all present but then adjourned to be reconvened on 11 January 2006.
26. When the reconvened meeting was opened all those who were scheduled to attend were present with the exception of Mr Riley. Mr Canute informed the meeting that Mr Riley had resigned his position as chairman and that he, Mr Canute, had assumed that role. The meeting proceeded to deal with a list of employee grievances that were aired. These included the ill-manner in which staff had been treated by Mr Riley as well as under payment of wages that had been revealed by a Department of Industrial Relations inspection. The meeting reached a resolution of issues and the expectation of the plaintiff after that meeting was that all outstanding issues have been resolved. The plaintiff’s expectation was that Mr Riley would no longer be in a position to bully, threaten, intimidate or harass her.
27. That expectation was of great significance to the plaintiff because in the months between October 2005 and January 2006, and before this meeting took place, the plaintiff had been experiencing escalating symptoms of a psychological nature with physical manifestations. These symptoms concerned scalp itching, nausea, and vomiting, episodic crying, sleeplessness, generalised body itching and associated problems. The plaintiff’s evidence, which I accept, was that in the three months in question, these problems gradually and increasingly escalated in their intensity and in their adverse effect on her ability to cope and to function at work.
28. After the meeting a roster was produced which restored her working hours to 66 hours per fortnight at a roster that suited her. The plaintiff’s expectation was that her workplace problems had been resolved with these events in combination with Mr Riley’s resignation which meant he would no longer be in a position of authority over her.
29. Despite these expectations, on the day following the meeting between staff, the union representative and Mr Canute, the plaintiff received a telephone call from a club patron which led her to believe that Mr Riley was at the club speaking about her and demanding that she apologise for going against him with the union. She became so distressed at the content of that call and its implications that she threw her telephone across her back yard and started to cry and wail. She calmed down after about an hour and rang Mr Riley at the club. In that call he told her he needed to see her and she then arranged to attend the club for that purpose.
30. The plaintiff later attended the club. She was taken aside by Mr Riley to a table where there were only the two of them. Her unchallenged account of what Mr Riley told her, which I accept, was as follows :
“… “Oh those rosters won’t be staying the same and by the way I’m now chairman of the board again, I’m not resigning. I’m re”, you know, “put myself back in, I’m chairman again and those rosters will not be staying the same.” He said, “I’ll do the best I can for you but I can’t promise you anything.”, and then he started going on about a contract, he said, “Oh I’ve got a contract for you, but”, and I said, “Can I have a look at it?”, and he said, “No, I’ve got to put it before the board yet.” And he said, “But I’ll do my best for you, but I can’t promise you anything.””
31. The plaintiff’s reaction to this conversation was one of disbelief.
Plaintiff’s psychological reaction to the events
32. The plaintiff’s description of her reaction to the foregoing conversation with Mr Riley was that she just “totally lost it.” She explained this by adding a description of the culminating events and their immediate aftermath in the following graphic description :
“Q. When you say “I’ve totally lost it”, what do you mean by that?
A. I just mentally broke down. I just blacked out, like I could not just take anything in any more. I was a mess.
Q. What were you noticing about yourself?
A. I felt like I had an out of body experience, I just could not - I felt really, just out of it, just - it started he was talking to me and I couldn’t hear or see anything. I wasn’t in myself. I’d had enough.
Q. What did you do then?
A. I sat with my next door neighbour. He bought me a drink and then he took me home.
Q. How were you that night?
A. Terrible, very bad. Stayed awake all night, crying, vomiting and I went to the doctor’s the next morning.
Q. You’d been having some vomiting or nausea for some weeks by then, had you not?
A. Yes.
Q. How did this vomiting that you experienced on this night compare to that previous vomiting, the same or different?
A. The same. I just all of a sudden I’d talk about work, I come home, because my husband had to put up with it, and I’d come home and I’d vent it all out on him and I’d just let it all out in the yard. Just vomit.
Q. Anything else about yourself that you noticed in terms of your body?
A. My rashes and my headaches.
Q. What about them?
A. Well the rash started in my head and it just travelled, it just travelled right to my feet, all over my back, my chest, my arms, my pits, my groin, my legs, everywhere.
Q. Anything else that you noticed about yourself?
A. Nightmares, terrible nightmares. Screaming. I attacked my husband once in my sleep thinking he was Mr Riley.
Q. What were you nightmare-ing about, what were you dreaming about?
A. About him. I dreamt he was coming after me with a gun, shooting at me, all those sorts of things. Those sorts of nightmares.
Q. How often were those nightmares occurring up to that point, up to 11 January 06?
A. Nightly, every night.
Q. Did they wake you up, did they, or not?
A. Yeah, I woke up screaming.
Q. Did those nightmares continue or--Q. When you woke up would you get back to sleep or--?
A. I’d stay awake for about three hours, I reckon.
A. Yes, and I still have them today.”
33. I accept that the plaintiff has suffered a very significant and severe adverse psychological reaction to a campaign of bullying, intimidation and harassment in the workplace due to the cumulative effects of Mr Riley’s wrongful conduct towards her along the lines outlined above. It was that psychological reaction which explains some unfortunate events that ensued shortly afterwards.
34. The plaintiff received a letter dated 9 February 2006 from the defendant enclosing a cheque for $1343.65 for underpayment of wages which had been detected on an inspection of the club records by the Department of Industrial Relations inspectors.
35. About one month later, as part of her treatment, the plaintiff attempted to return to work under the supervision of her treating psychologist, Ms Gibbs. On this occasion, on reaching the gateway of the club premises, she had a panic attack and found that she could not continue. A meeting had been arranged for the plaintiff to meet at the club with Mr Riley in the company of the new manager Mr Bowden to enable a discussion to take place. The plaintiff received a message that Mr Riley would not be available for the meeting.
36. A further meeting was scheduled to take place on 31 May 2006 at the club. The plaintiff again attended the club premises with her treating psychologist Ms Gibbs. The plaintiff’s account of this event, which I accept, was in the following terms :
“Q. You nevertheless made another attempt, did you not, in the company of Judith Gibbs?
A. Yes.Q. To go back to the work site?
A. Yes.Q. On 31 May 2006?
A. That's right.Q. Firstly, what led up to you having another go?
A. She just kept at me and at me until I did it, so I thought okay, I’ll try and beat it. Once we got to the gate I saw Mr Riley’s car in the carpark and I broke down in the gutter and my nose just started gushing blood, when I was sitting in the gutter. And I wouldn’t go in.Q. You would not go in?
A. No way.HIS HONOUR
Q. Had you previously had a tendency to nose bleeds?
A. Never.Q. What happened after that?PERRY
A. I said to Judith, “I want to go home.” She kept saying, “Come over, come over to the fence”, and all that and I went, “No, I’m going home, I will never, ever set foot in this place again.””
37. Subsequently, on 26 June 2006, through a telephone call the plaintiff acquired the perception that Mr Riley had been speaking about her with a number of patrons of the club and had been laughing and making fun of her psychological condition. Her evidence in this regard was in the following terms :
“Q. What did you understand was the--
A. That he was making fun of me, my condition, my rash, and how I tried to get back in there with my supposed psychiatrist, he called it, and I got angry.Q. Did you make a telephone call to the club, did you?Q. As a result of that did you do something?
A. Yes, I did.
A. Yes.”
38. In her call to Mr Bowden she made a threat to Mr Riley’s life. She explained that she felt that her mind was out of control when this occurred. She contacted her psychologist after this had occurred. Her psychologist attended to assist her. She was later interviewed by the police and her psychologist explained the background of the situation to the police. She was not charged with any offence arising from that call. She had obviously been driven by anger to lose her self-control and make that threat.
39. A few days later, on 3 July 2006, her employment was formally terminated by the defendant. She has been in receipt of weekly payments of workers’ compensation since then. She described her situation in the following terms :
“PERRY
Q. How do you feel about doing some work these days?
A. No.Q. Do you think you’ve been fit for any type of work since January ‘06?
A. No.Q. Why?
A. Because I’m a totally different person now.Q. What do you mean by that?
A. I’m living virtually like a hermit. I have no patience for anybody. I can go off if somebody upsets me in the wrong way. I don’t trust myself and I don’t want to have any social doing with anybody ever.
Q. Well you say you’ve changed, could you give please the court some examples of this? Can I start firstly with your comment about you living like a hermit?
A. Mm.Q. Do you go out at all?Q. Could you expand on that please?
A. I’m just at home 24/7.
A. No, not unless I’m with my husband.”
40. She described how, despite treatment, she was unable to travel to Byron Bay in December 2007 to attend her son’s wedding, so severe and intractable to treatment were her psychological problems.
Treatment
41. The plaintiff initially attended her general practitioner who prescribed medication for her to take and referred her to a psychologist and later to a psychiatrist. She has pursued the counselling that has been recommended to her. She has participated in attempts at graduated exposure therapy aimed at trying to get her back to work. She has taken her prescribed medications and she continues to see a consultant psychiatrist Dr Alex Pilsky on a regular monthly basis for ongoing counselling, monitoring of her condition and for monitoring of her medications.
42. There is evidence of some apparent interference in the plaintiff’s therapeutic relationship with her former general practitioner. This occurred when the workers’ compensation insurer’s claims officer made some comments to the treating general practitioner which in turn led to an interference with the doctor-patient relationship and which necessitated the plaintiff seeking the assistance of another general practitioner under whose care she presently remains.
Mitigation issues
43. It is necessary to consider the defendant’s submission which asserts that the plaintiff has not taken reasonable steps to mitigate her situation. In my view she has done so. This is evident from her action in promptly seeking out the assistance of her general practitioner and compliantly taking the medication that was prescribed for her. She also complied with the suggestion of seeing a psychologist for counselling and treatment and she participated in attempts at graduated re-exposure to the workplace, albeit unsuccessfully. She participated in cognitive behavioural therapy treatment. She has also complied with the treatment recommendation that she see a consultant psychiatrist and she continues to remain under monthly psychiatric review by Dr Pilsky.
44. The defendant bears the onus of showing that the plaintiff has failed to mitigate her loss by unreasonably not submitting herself to treatment when the benefits of such treatment would have been apparent to her : Fazlic v Milingimbi Community Inc [1982] HCA 3 at [12]; (1982) 150 CLR 345. In my view the evidence discloses that the defendant has not discharged that onus. On the contrary, in my view it is clearly apparent from the evidence that the plaintiff has taken reasonable steps to mitigate her loss. Therefore, I do not discount her entitlement to damages on account of any alleged failure to mitigate, as has been submitted by the defendant.
Medical evidence
45. Medical reports were obtained and tendered by the legal representatives of the parties. No medical witnesses were called to give oral evidence. In the paragraphs that follow I set out my review of such medical evidence.
Plaintiff’s medical evidence
Dr Ramakrishna and Dr Howe – treating general practitioners – certificates 11 January 2006 to 1 March 2007
46. The plaintiff’s treating general practitioners Dr Ramakrishna and Dr Howe issued a number of workcover medical certificates. Those tendered were dated 11 January 2006, 24 January 2006, 22 February 2006, 24 March 2006, 24 April 2006, 14 May 2006, 10 June 2006, 14 July 2006, 13 October 2006, 12 December 2006 and 31 January 2007. These certificates variously described post-traumatic stress disorder, depression, anxiety and panic disorder related to workplace problems. These certificates described the treatment plan for the plaintiff as including cognitive behavioural therapy, graded exposure to the stressor and counselling. The last of these certificates indicated that the plaintiff was unfit for work until 1 March 2007 and noted that a referral had been made to Ms Judith Gibbs, a clinical psychologist.
Ms Judith Gibbs – clinical psychologist – report dated 1 September 2006
47. The plaintiff consulted Ms Judith Gibbs, a clinical psychologist. The report of Ms Gibbs was dated 1 September 2006. Whilst her report did not identify the date of the first consultation or the dates of the consultations that followed, it nevertheless outlines the nature and course of the problems for which the plaintiff sought counselling treatment from Ms Gibbs. Her report confirmed the plaintiff’s presentation to her in a state of severe psychological distress. The report makes clear that such distress commenced to be manifest after the occurrence of unpleasantness directed to the plaintiff by her work supervisor in the workplace. After interviewing, testing and counselling the plaintiff, Ms Gibbs offered the diagnosis of anxiety and depression. Ms Gibbs’ report also described the plaintiff’s agoraphobia and inability to carry out tasks directed at assisting her to deal with her anxiety.
48. Ms Gibbs stated that the exacerbating incidents that occurred when the plaintiff had tried to return to work, as witnessed by her, have had a retrograde effect in that any psychological gains the plaintiff obtained from Ms Gibbs’ treatment were lost.
49. Before the plaintiff’s employment had been terminated Ms Gibbs had been providing the plaintiff with psychological support through counselling and therapeutic exercises. Ms Gibbs has graphically described her witnessing of the plaintiff’s adverse psychological reaction to attempting to re-enter her former workplace on several occasions. This unchallenged evidence served to independently confirm the basis for my acceptance of the plaintiff as a credible witness. Other evidence permits the inference that the plaintiff was last seen by Ms Gibbs on 4 April 2008 but there is no evidence of this in the form of any further reports from Ms Gibbs.
Mr Malcolm Desland – consultant psychologist – report dated 12 June 2007
50. On 23 April 2007 and 9 May 2007, at the request of her solicitor the plaintiff was interviewed by Mr Malcolm Desland, a clinical psychologist. Mr Desland prepared a report dated 12 June 2007. He took a detailed history including a history of the relevant events in the workplace. He considered that the plaintiff met the diagnostic criteria for panic disorder with agoraphobia and a major depressive episode. He considered these conditions chronic because they were of greater than six months duration. Whilst he considered that the plaintiff had experienced very traumatic events, he did not at that time consider that she met the diagnostic criteria for post-traumatic stress disorder. He nevertheless assessed her as having moderate impairment with self-care and personal hygiene, moderate impairment with recreational functioning, mild impairment concerning local travel without support, mild impairment in social functioning, severe impairment with concentration and persistence and total impairment concerning employability, that latter impairment being a continuing one.
Dr Alex Pilsky – consultant psychiatrist – reports dated 30 June 2009
51. On 10 February 2007 the plaintiff was seen by Dr Alex Pilsky, a consultant psychiatrist. He saw the plaintiff at the request of her general practitioner for the purpose of treatment and medical management of her psychiatric illness. His last consultation with the plaintiff at the time of reporting to the plaintiff’s solicitor was on 20 May 2009. His report was dated 30 June 2009. Dr Pilsky had what I consider to have been a considerable therapeutic advantage in seeing the plaintiff for numerous sessions at intervals that were initially weekly, then fortnightly and then monthly over a period of 2 years. He also had the opportunity of interviewing the plaintiff’s husband on 3 occasions. Dr Pilsky also had the advantage of witnessing the plaintiff’s physiological response to her stress.
52. Relevantly, Dr Pilsky noted the earlier history of the plaintiff having manifested relatively mild symptoms of anxiety in the context of an unstable accommodation situation in 2004 and which quickly responded to anti-depressant medication and which in turn fully alleviated the problem.
53. Dr Pilsky described the plaintiff as having been asymptomatic of psychological problems before she encountered the workplace problems that are the subject of this claim. He described the plaintiff as having a pre-existing vulnerability to the triggering of her current psychiatric disorders which he described as being a generalised anxiety disorder and panic disorder with agoraphobia. He also stated that the plaintiff presented with some features of post-traumatic stress disorder including intrusively re-experiencing the traumatic events with recollections and nightmares and persistent avoidant behaviour. He also noted the presence of a skin rash which I infer from the context to be of nervous origin.
54. Dr Pilsky stated that the plaintiff’s psychiatric disorders were virtually resistant to treatment and he noted numerous trials of medication and cognitive behavioural therapy. He was of the opinion that the condition of generalised anxiety disorder tends to run a chronic course and in the presence of the co-morbidity of panic-disorder, agoraphobia and features of post-traumatic stress disorder with depressive symptoms, the picture is further complicated. Against this background, he stated that even with treatment it is unlikely that the plaintiff would fully recover from these identified psychiatric disorders or even experience a significant improvement. His prognosis was guarded and he recommended monthly psychiatric consultations for the foreseeable future to treat and monitor the plaintiff’s symptoms and to allow for intervention in the event of future likely exacerbations of her condition.
Dr Stephen Allnutt – consultant psychiatrist – reports dated 21 January 2008 and 24 July 2009
55. On 15 January 2008, at the request of her solicitors the plaintiff was examined by Dr Stephen Allnutt, a consultant psychiatrist. Dr Allnutt prepared a report dated 21 January 2008. Dr Allnutt reviewed the history of the relevant events and incidents, and concluded that the plaintiff manifested symptoms consistent with an anxiety disorder characterised by episodes of palpitations, shortness of breath and dizziness and occasional nausea, all of which caused a significant degree of avoidant behaviour particularly in public places such as shopping malls and when interacting with others. Dr Allnutt also noted a number of depressive symptoms including sleep disturbance, fluctuating mood, impairment of appetite, impairment of energy and motivation, impairment of decision-making and concentration.
56. Dr Allnutt expressed the opinion that all of these symptoms could have resulted in a significant degree of social and occupational dysfunction characterised by impaired self-care, reduced socialisation, difficulties with travel, difficulties with relationships and difficulty with employment. He traced the onset of these symptoms to workplace problems. When he saw her he felt there were reasonable grounds to conclude that she was manifesting symptoms consistent with panic disorder and agoraphobia along with social phobia and a depressive disorder.
57. Dr Allnutt thought it was reasonable to conclude that the plaintiff had a probable pre-existing vulnerability to anxiety and depressive disorder and was prone to being easily anxious. He considered that the work incident in question caused, or substantially contributed to the onset of a significant psychiatric disorder as described. He considered that condition was not present beforehand.
58. On 24 July 2009 Dr Allnutt undertook a review of his notes at the request of the plaintiff’s solicitor for the purpose of expressing a view on the plaintiff’s fitness for work. Following the required review he concluded that the plaintiff was, at that stage, unfit to return to work until she achieved better control of her depressive and anxiety symptoms.
Defendant’s medical evidence
Dr Peter Snowdon – consultant psychiatrist – reports dated 18 September 2007 and 26 March 2008
59. On 5 September 2007, at the request of the workers’ compensation insurer, the plaintiff was examined by Dr Peter Snowdon, a consultant psychiatrist. Dr Snowdon also interviewed the plaintiff’s husband to obtain a wider perspective of the plaintiff’s situation. The report which followed that examination and interview was dated 18 September 2007. It is clear from the report that the plaintiff had experienced considerable difficulty with regard to her contact and case management with the workers’ compensation insurer and with the assigned rehabilitation providers. The focus of Dr Snowdon’s report was to try and assist the plaintiff with a return to work. After reviewing the plaintiff’s reported symptoms, the related medical reports and correspondence, including discussions with the plaintiff’s treating general practitioner, psychologist and psychiatrist, Dr Snowdon stated that at the time of his examination, the plaintiff could be considered unfit for any work for the next four months.
60. On 26 March 2008, after reviewing some certificates that stated that the plaintiff still remained unfit to return to work, and after speaking by telephone with the treating general practitioner, Dr Snowdon expressed his view that the plaintiff had a chronic adjustment disorder with mixed anxiety and a depressed mood.
61. It appears from Dr Snowdon’s 26 March 2008 report that he may also have spoken to the plaintiff’s treating psychiatrist, Dr Pilsky. He stated that both he and Dr Pilsky were agreed that the plaintiff remained unfit for any work and that there should be no further re-opening of attempts at vocational rehabilitation. He noted his agreement with Dr Pilsky that this was a situation that would probably remain in the fairly long-term.
Dr A P McClure – consultant psychiatrist – report dated 7 November 2008
62. On 7 November 2008, at the request of the workers’ compensation insurer the plaintiff was assessed by Dr A P McClure, a consultant psychiatrist. The purpose of the assessment was to obtain a Medical Assessment Certificate pursuant to s 319 of the Workplace Injury Management and Workers Compensation Act 1998. His issued certificate was dated 7 November 2008. Dr McClure assessed the plaintiff as having sustained a psychiatric and/or psychological injury amounting to 22 per cent whole person impairment pursuant to the AMA 5 tables. This has resulted in the Workers Compensation Commission issuing a facilitative medical certificate pursuant to Part 7 of the Workplace Injury Management and Workers Compensation Act 1998.
63. Dr McClure concluded that during the last 3 months of her work with the defendant the plaintiff suffered from a relatively gradual onset of psychological problems ultimately comprising recurrent panic attacks, avoidance behaviours and agoraphobia. He noted that despite intensive psychological and psychiatric treatment the plaintiff’s condition has failed to improve. Dr McClure confirmed the plaintiff had sustained a primary psychiatric injury substantially caused by her employment. He made an assessment of a 22 per cent whole person impairment under the assessment guidelines. He noted that there were no inconsistencies in the plaintiff’s presentation.
Dr WSG Rowe – consultant psychiatrist – report dated 5 March 2008
64. On 5 March 2008, at the request of the defendant’s workers’ compensation insurer, the plaintiff was examined by Dr WSG Rowe, a consultant psychiatrist. Dr Rowe’s report was of the same date as his consultation with the plaintiff. He noted that the plaintiff’s presentation was obviously tense, anxious and despondent.
65. Curiously, Dr Rowe’s report discloses that he had earlier examined the plaintiff on 17 January 2006 at the request of the defendant. He stated that his report of that consultation had been sent to the insurer on the same date as the consultation. He stated that the 5 March 2008 report should be read in conjunction with the 17 January 2006 report. Despite the reference to the earlier report, Dr Rowe’s report of 17 January 2006 was not tendered in evidence nor was its absence the subject of explanatory evidence. Accordingly, it was not possible for me to fully evaluate Dr Rowe’s report of 5 March 2008.
66. Dr Rowe concluded that the plaintiff suffered from a chronic adjustment disorder, not only as a result of the work situation which he reviewed, but also due to the way she felt she had been treated by the workers’ compensation insurer. He noted that she was despondent, anti-social and that her prognosis had deteriorated. I infer this was a deterioration from an earlier and more favourable prognosis that had been expressed in Dr Rowe’s earlier report that has not been tendered.
67. Dr Rowe recommended that the plaintiff should continue under the care of her psychiatrist and psychologist for treatment. He expressed the hope that a newly assigned workers’ compensation claims officer would be more compassionate in her dealings with the plaintiff otherwise he foreshadowed that the plaintiff’s condition would continue indefinitely. He noted that at the time he saw her the plaintiff had not yet reached her point of maximum medical improvement.
68. In a separate letter to the insurer, Dr Rowe provided some context to the change of claims officer, indicating that on an acceptance of the plaintiff’s account of events, the plaintiff’s treating general practitioner had refused to continue to see her because she was a “compensation case” and that this situation, which led to an episode in which the plaintiff was admitted to hospital, arose because the previous claims officer had unreasonably and inappropriately interfered with her treatment and her relationship with her general practitioner.
69. On 12 March 2008 the workers’ compensation insurer sent Dr Rowe a facsimile that enclosed for his consideration a copy of a letter dated 3 April 2007 from Dr Pilsky. Neither of those documents were tendered so I will not speculate as to the content of that correspondence. In answer to a question posed to him in that letter Dr Rowe stated that he felt the plaintiff’s condition would substantially improve if a better relationship could be formed between the parties involved in her case. It would appear that this was a reference to relations between the plaintiff and the workers’ compensation claims officer. Dr Rowe re-iterated that he thought the plaintiff had not reached maximal medical improvement. Somewhat optimistically, and without stating the reasons for his view, he stated that he was hopeful that the plaintiff would improve to the extent that she could return to the workforce in the foreseeable future. I do not accept the validity of that view because it was not explained by cogent reasons.
Disabilities preventing the plaintiff’s return to work
70. The plaintiff’s psychiatric illness, as described by the assessors who have examined her, has left her with a serious and chronic generalised anxiety disorder with panic and agoraphobia together with features of post-traumatic stress disorder. She has distracting skin rashes, she has sleeplessness and suffers recurring nightmares. She exhibits persistent avoidance behaviour and she is significantly depressed.
71. I accept Dr Pilsky’s views on the bleak diagnosis and prognosis for these problems. In my view he was ideally placed as the treating specialist with frequent opportunity to gain insight into her problems to best gauge her psychological prognosis. I accept his view that it is unlikely that the plaintiff will fully recover from these problems. I find that at this stage of her life it is most unlikely that the plaintiff will ever return to remunerative employment because of her disabling and ongoing psychiatric problems. In my view she would have otherwise worked until at least the age of 65 years because in her case there was a financial incentive for her to do so.
Life span
72. At the age of 52 years, on the prospective or projected life tables, the plaintiff’s probable future life span is a remaining 36 years. This indicates that there is no foreshortening of the remaining 13 years of working life she would ordinarily expect to fulfil until age 65 years.
Assessment of damages
73. I now turn to address the assessment of the claimed heads of damage for past loss of earning capacity, future loss of earning capacity and as well as past and future superannuation losses.
Past loss of earning capacity
74. The plaintiff makes a claim for past loss of earnings for the period of 188 weeks between 11 January 2006 and the commencement of the trial on 24 August 2009. The plaintiff has submitted three alternative scenarios for calculation for such losses, namely $122,196, $121,150 and $108,044 respectively.
75. The defendant has submitted that the plaintiff’s claim for past loss of earnings should be limited to the period 11 January 2006 to 25 May 2009, a period of 176 weeks at the rate of $516.95 per week net which calculates out to $90,983 net. The defendant further submits that from 26 May 2009 to the trial, a period of some 13 weeks, the plaintiff’s claim for past loss of earnings should be assessed at $230 per week net which calculates out at $2,990. The total of these two amounts submitted by the defendant is $93,883.
76. On a broad overview the three calculation scenarios submitted by the plaintiff and marked MFI “7” are not all that significantly different and proceed upon the basis of assumptions concerning the pre-incident rate of earnings with variations for CPI or NAPSA increments. I consider each scenario generally to be a reasonable measurement of the plaintiff’s past earnings potential in the period up to the commencement of the trial.
77. I consider the defendant’s submitted calculation of past loss of earnings to be flawed on three bases. First, the defendant seeks to quantify the plaintiff’s past loss of earning capacity by using a weekly rate that is too low and which in my view represents an insufficient measure of earning capacity. Given the history of historical underpayment of wages by the defendant I am not prepared to accept the accuracy of the tendered wage records as being an accurate guide to assessment. Secondly, the calculations submitted by the defendant represents an inadequate recompense for the plaintiff’s period of loss because it is a flat rate calculation that makes no allowance for CPI or NAPSA increments. Thirdly, the defendant’s submitted reduction of the calculated rate down to $230 per week is not justified by either the evidence of the plaintiff’s potential earnings nor is it justified by the medical evidence insofar as it implies a residual earning capacity.
78. I find that in the period 11 January 2006 and continuing until the commencement of the trial the plaintiff was precluded from carrying out her work or any other work by reason of the psychological and psychiatric problems that she encountered as a result of the events in question.
79. I find that were it not for the bullying, intimidation and harassment that the plaintiff experienced in her employment with the defendant, she would have had the capacity to earn at least $613.02 per week net together with periodic increments that would have applied to that base rate, either in the employ of the defendant or in some form of similar employment elsewhere, consistent with her impressive prior work history.
80. I assess the plaintiff’s past loss of earnings by taking an average of the three scenario calculations put forward by the plaintiff to quantify the loss that I have found to have occurred. This amounts to $117,130 and I round this sum down to $117,000. I therefore assess the plaintiff’s damages for past loss of earning capacity in the amount of $117,000.
Future loss of earning capacity
81. The plaintiff makes a claim for future loss of earning capacity for what was submitted to be the remaining 12.4 years of working life she would have enjoyed had she remained able to continue working. The commensurately adjusted 5 per cent multiplier for 12.4 years is 485.26. The plaintiff claims the sum of $683.75 per week net over that period discounted by 10 per cent for vicissitudes which yields the sum of $298,616.
82. In contrast the defendant submits that the plaintiff’s future loss of earning capacity should be assessed over a conceded remaining 13 years at the rate of $230 per week net which when projected at 5 per cent (x 502.3) and discounted by 15 per cent for vicissitudes yields the sum of $98,199.
83. In my view each of these submissions are problematic.
84. I consider the defendant’s submissions concerning future loss of earning capacity to be flawed because they proceed upon the incorrect premise that the plaintiff’s future earnings have been limited to $230 per week net over the remainder of her working life. The incorrect premise for that submission is the notion that only a reduced number of hours of work would have been available to the plaintiff and the plaintiff has an implied residual earning capacity. For the reasons already given I reject the submission that the plaintiff’s loss should be measured at $230 per week. I reject the submission that the plaintiff has a residual earning capacity. Based on the assessment of Dr Pilsky I find the plaintiff is unable to resume work and this will continue until she reaches retirement age.
85. The evidence of Mr Bowden discloses that the defendant club was in dire financial straits and I infer from his evidence that it is highly probable that he is likely to leave his position at the club in the very near future and that as a consequence, the club will most probably fail, cease to trade and will close down very shortly thereafter.
86. If the plaintiff were still working at the club and if the club was in such straitened financial circumstances I consider it most unlikely that the plaintiff would have continued to have worked there for less hours or for less money than was her expectation given her ongoing financial needs, including the pressing need to pay rent. Accordingly I find that it is more probable than not that if the club were to have been in financial difficulty whilst the plaintiff was working there, given her history that she was able to readily find alternative well-paid employment elsewhere within her skill set and experience whenever the need arose, she would change her employment to meet her financial needs.
87. In addition to finding flaws in the defendant’s submissions concerning future loss of earning capacity, I also consider that the plaintiff’s submissions on future loss of earning capacity are flawed in several respects. Firstly the fractional approach to the assessment of the multiplier is unnecessary in a case of this relative proportion. Secondly, I consider that the projected sum of $683.75 per week is unrepresentative of the plaintiff’s future loss of earning capacity in the market outside of employment with the defendant given her extensive experience including at a supervisory level. Thirdly, I consider a discount of 10 per cent on account of adverse vicissitudes to be too low and I prefer the conventional approach to vicissitudes as selected by the defendant namely, 15 per cent. I do not consider that the plaintiff’s previous episode of anxiety, for which she had a pre-disposition to some degree and which on one prior occasion required medical treatment, was a factor in favour of a higher discount for vicissitudes. I take this view because there is no evidence that the earlier illness or her pre-disposition resulted in any significant absence from work.
88. Given the financial precariousness of the defendant I consider that it is more probable than not the plaintiff would have readily found alternative employment, most probably at a higher rate given her extensive experience in bar service, including at a supervisory level. It is for this reason that I consider that the pre-trial rates of earnings with increments as relied upon by the defendant to estimate the plaintiff’s past loss of earnings to be not fully representative of her future earning capacity had she remained psychologically well. Having regard to published rates for average weekly earnings for total employees in New South Wales as a background guide to assessment, and also having regard to the rates applied to assess the plaintiff’s past loss of earnings, I consider the future loss of earning capacity claim should be assessed at a higher rate than that which has been submitted.
89. The AWE figure for full ordinary time total weekly earnings for New South Wales is currently $1213 per week gross. After allowing for the applicable tax rates and Medicare levy this is the equivalent of $949.17 per week net. In order to identify the plaintiff’s earnings potential I adopt a reduced figure of $783 per week to make due allowance for the fact that the plaintiff’s shifts were 66 hours per fortnight rather than a full time 80 hours per fortnight.
90. I consider this to be a case where it is appropriate to project the weekly loss until the plaintiff’s retirement age of 65 years at the higher rate of average weekly earnings as adjusted in the manner I have described because of the financial status of the defendant as this would impact on the continuity of the plaintiff’s employment : Kallouf v Middis [2008] NSWCA 61 following Husher v Husher [1999] HCA 47; (1999) 197 CLR 138.
91. I therefore find that the plaintiff’s future loss of earning capacity should be projected at 5 per cent over the ensuing 13 years of her working life at $783 per week net and discounted by 15 per cent on account of potential adverse vicissitudes. The projection of $783 per week net at 5 per cent over 13 years (x 502.3) less 15 per cent yields $334,305. I therefore assess the plaintiff’s damages for future loss of earning capacity in the sum of $334,305.
Past loss of superannuation
92. The conventional approach to the assessment of past lost superannuation benefits is to calculate that loss as being 11 per cent of the sum calculated for past net lost earnings, which in this case, is $117,000. This approach yields the amount of $12,870. I therefore assess the plaintiff’s claim for past loss of superannuation benefits in the amount of $12,870.
Future loss of superannuation
93. Applying the same conventional approach to the calculation of the lost value of future superannuation benefits, 11 per cent of the assessed loss of future earning capacity in the sum of $334,305yields the sum of $36,773. I therefore assess the plaintiff’s claim for future loss of superannuation benefits in the amount of $36,773.
Fox v Wood
94. The total amount of tax that has been periodically deducted from the plaintiff’s weekly workers’ compensation payments has been agreed and in accordance with that agreement I assess the plaintiff’s entitlement to Fox v Wood damages in the amount of $6,602.
Summary of damages assessment
95. My assessment of the plaintiff’s damages is summarised as follows:
(a) Past loss of earning capacity (b) Future loss of earning capacity (c) Past loss of superannuation (d) Future loss of superannuation (e) Fox v Wood Total
Disposition
96. As has been conceded by the defendant, the plaintiff must succeed on the issues of liability and causation and I have made findings along those lines. There is no entitlement to claim non-economic loss and there is no claim for past or future treatment expenses or any other heads of damage. I have assessed the plaintiff’s entitlement to damages in the sum of $507,550.
Orders
97. I make the following orders:
(a) Verdict and judgment for the plaintiff in the sum of $507,550;
(b) The defendant is to pay the plaintiff’s costs;
(c) The exhibits may be returned;
(d) Liberty to apply on 7 days notice if further orders are required.
6
3