Bernie Howe Pty Ltd v Motor Accidents Insurance Board - [2017] TASSC 27

[2017] TASSC 27

COURT: SUPREME COURT OF TASMANIA

CITATION: Bernie Howe Pty Ltd v Motor Accidents Insurance Board

[2017] TASSC 27

PARTIES:  BERNIE HOWE PTY LTD
  v
  MOTOR ACCIDENTS INSURANCE BOARD

FILE NO:  721/2014
DELIVERED ON:  1 May 2017
DELIVERED AT:  Hobart
HEARING DATE:  4 April 2017
JUDGMENT OF:  Blow CJ

CATCHWORDS:

Workers' Compensation – Entitlement to compensation – Injury, disease or disability – "Disease" – What constitutes "disease" – Post-traumatic stress disorder – Ailment or disorder of sudden development.

Workers Rehabilitation and Compensation Act 1988 (Tas), ss 3(1), 25(1).
Attorney-General v Smith (Unreported) A35/1994, [1994] TASSC 62, discussed.
Aust Dig Workers' Compensation [7]

REPRESENTATION:

Counsel:
             Plaintiff:M Wilkins
             Defendant:  K E Read SC
Solicitors:
             Plaintiff:  Page Seager Lawyers
             Defendant:  Murdoch Clarke

Judgment Number: [2017] TASSC 27
Number of paragraphs: 24

Serial No 27/2017
File No 721/2014

BERNIE HOWE PTY LTD v MOTOR ACCIDENTS INSURANCE BOARD

REASONS FOR JUDGMENT BLOW CJ

1 May 2017

This is an action by an employer seeking an indemnity in relation to payments of workers compensation made by it in respect of a psychiatric disorder suffered by an employee.
The plaintiff company, Bernie Howe Pty Ltd, carries on a business involving the distribution and delivery of fertilizer. In 2011 one of the company's employees was a truck driver named Bruce Jordan. On 30 December 2011 he went to the premises of one of the company's customers, Impact Fertilizer, at Mole Creek, where he attended an induction session. Thereafter, he set out to drive to his home at West Kentish. When travelling along Union Bridge Road at Paradise, he was involved in a head-on collision with a motorcycle. The motorcyclist died at the scene.
As a result of his involvement in the fatal collision, Mr Jordan commenced to suffer from post-traumatic stress disorder ("PTSD"). He became unfit for work, and medical expenses were incurred. He made a claim for compensation pursuant to the Workers Rehabilitation and Compensation Act 1988 ("the WRC Act"). Compensation was paid.
The plaintiff contends that it is entitled to recover an indemnity in respect of the compensation that it has paid, by virtue of s 134(1) of the WRC Act. That subsection reads as follows:
"(1) Subject to this section, where an injury for which compensation is payable to a worker is caused under circumstances which, but for section 138AB, would create a liability in some person other than the employer to pay damages in respect of that injury to that worker, the employer may recover indemnity against that person in respect of the compensation paid by the employer to the worker in respect of that injury."
The defendant concedes that the collision was caused by negligence on the part of the motorcyclist. By virtue of ss 14(1) and 16(1)(a) of the Motor Accidents (Liabilities and Compensation) Act 1973, when a person suffers personal injury as the result of a motor vehicle accident caused by the negligent driving of a person who has died, the injured person may take proceedings for damages against the Motor Accidents Insurance Board ("MAIB"), and obtain judgment against it, in respect of the liability of the person who has died. It follows that, if compensation was payable to Mr Jordan under the WRC Act, the plaintiff is entitled to recover an indemnity from the MAIB pursuant to s 134(1). However the MAIB contends that compensation was not payable to Mr Jordan under the WRC Act. It has defended this action solely on that basis.
The plaintiff contends that it was liable to pay compensation to Mr Jordan pursuant to s 25(1) of the WRC Act. The relevant parts of that subsection read as follows:
"(1) If in any employment —
(a) a worker suffers an injury, not being a disease, arising out of or in the course of his employment; or
(b) a worker suffers an injury, which is a disease and to which his employment contributed to a substantial degree, within the meaning of section 3(2A) —
his employer is, except as is otherwise provided by this Act, liable to pay compensation in accordance with this Act —
(c) to the worker …".
Because of the wording of s 25(1)(a) and (b), the circumstances that give rise to a liability to pay compensation differ according to whether the worker suffers "an injury, not being a disease" or "an injury, which is a disease". If the worker suffers an injury that is not a disease, the employer is liable to pay compensation only if the injury is one "arising out of or in the course of his employment": s 25(1)(a). If the worker suffers from a disease, the employer will be liable to pay compensation only if the disease is one "to which his employment contributed to a substantial degree": s 25(1)(b).
Subject to certain exceptions, an injury is not compensable if it is suffered by a worker during a journey to his or her place of residence after finishing work. Relevantly, s 25(6)(a) of the WRC Act provides as follows:
"(6) For the purposes of this section, an injury does not arise from a worker's employment if it occurs —
(a) while the worker is travelling in either direction between the worker's place of residence and the worker's place of employment, except where that journey occurred —
(i)at the request or direction of the employer; or
(ii)if the journey is work related, with the authority (expressed or implied) of the employer …".
Section 25(7) provides as follows:
"(7) For the purposes of subsection (6)(a)(ii), a journey is not work related by reason only of the fact that it is for the purpose of enabling a worker to travel —
(a) to his or her place of employment from his or her place of residence; or
(b) to his or her place of residence from his or her place of employment."
The plaintiff's contentions as to its liability to pay compensation can be summarised as follows:
· For the purposes of the WRC Act, Mr Jordan's PTSD is an injury that is not a disease.
· The PTSD arose in the course of Mr Jordan's employment because the collision occurred when he was travelling between two places of employment, namely the Mole Creek premises of Impact Fertilizer and his home, where he routinely carried out employment duties. Alternatively, he was travelling from the Mole Creek premises to a depot in Devonport where he intended to wash his employer's truck.
· In the alternative, if Mr Jordan's PTSD is a disease, his employment contributed to that disease to a substantial degree.
The MAIB's contentions as to the issue of liability to pay compensation can be summarised as follows:
· For the purposes of the WRC Act, Mr Jordan's PTSD is a disease.
·     His employment did not contribute to that disease to a substantial degree since the sole cause of that disease was the negligent driving of the deceased motorcyclist.
·     In the alternative, if Mr Jordan's PTSD is not a disease, it neither arose out of Mr Jordan's employment nor arose in the course of his employment.
·     The PTSD was caused by an event that occurred when Mr Jordan was travelling to his place of residence after completing his employment duties on the day in question. His journey did not occur at the request or direction of his employer, and was not a work-related journey authorised by his employer.
There was conflicting evidence as to what Mr Jordan intended to do after leaving Mole Creek. He gave evidence that he intended to call in at his home, possibly pick up his son, proceed to Devonport, wash his employer's truck at a depot there, finish work at around 1.30pm or 2pm, and then go fishing. However, in an affidavit sworn on 3 January 2012, four days after the collision, Mr Jordan said this:
"I left home at about 8.25am, travelled to Mole Creek for an induction for work at the Mole Creek Limeworks. That induction finished at about 9.30am or so. I left to drive home. I was in no hurry as we were heading to the Lakes for a few days at 1pm, so I slowly started to drive home."
That affidavit was prepared by a police officer for the purpose of a coroner's inquest. Mr Jordan was cross-examined about it. He conceded that he had told the police officer the truth. That being the state of the evidence, I am not satisfied on the balance of probabilities that Mr Jordan intended to go to Devonport to do anything for his employer on the day in question. There was evidence that he sometimes made phone calls from his home to arrange truck movements for his employer, but there was no suggestion that he intended to do any work for his employer at his home that day. The evidence does not establish that, when the collision occurred, Mr Jordan was driving for any purpose other than returning home.
I turn to the issue of whether Mr Jordan's PTSD is a disease for the purposes of the WRC Act. Section 3(1) of that Act contains the following definition:
"disease means any ailment, disorder, defect, or morbid condition, whether of sudden or gradual development".
The same subsection contains a non-exhaustive definition of the word "injury". It reads as follows:
"injury includes —
(a)a disease; and
(b)the recurrence, aggravation, acceleration, exacerbation or deterioration of any pre-existing injury or disease where the employment was the major or most significant contributing factor to that recurrence, aggravation, acceleration, exacerbation or deterioration —
but does not, except for the purposes of section 97(1)(b) and (c), include an asbestos-related disease within the meaning of the Asbestos-Related Diseases (Occupational Exposure) Compensation Act 2011".
As I have said, the plaintiff contends that Mr Jordan's PTSD is not a disease. Its counsel relied on an unreported decision of Zeeman J, Attorney-General v Smith A35/1994, [1994] TASSC 62. That was an appeal under the WRC Act. It concerned a worker who became incapacitated as a result of suffering an aneurysmal subarachnoid haemorrhage while she was at work. She had had a cerebral aneurysm for a long time, but was not incapacitated until it haemorrhaged. She claimed compensation on the basis that the haemorrhage was an injury, not being a disease, and that it occurred in the course of her employment. The employer contended that the worker's incapacity resulted from a disease. Zeeman J held that the incapacity was caused by the aneurysm, and that the haemorrhage that caused the disablement of the worker must be treated as part of the development of the pre-existing medical condition.
In his reasons, Zeeman J considered the distinction between a disease and an injury that is not a disease. At 5 he said:
"I consider that the key to the distinction between injuries which are and which are not diseases is to be found in the word 'development' appearing in the definition of 'disease'. That word suggests that the definition is limited to conditions which might be said to develop. It is implicit from the use of that word that the definition is concerned with autogenous conditions and conditions which find their origin in the environment in which a worker finds himself which naturally progress (whether gradually or suddenly) as distinct from physiological change, not related to any such condition, which results from external trauma. The external trauma which made the pre-existing tinea (which in itself was a disease) in Pasminco Australia Ltd v Fairchild [Unreported, Full Court, A57/1991] incapacitating did not result in the worker having suffered an injury other than a disease. It remained a disease, namely tinea. On the other hand the physiological change which occurs when a worker falls and breaks his leg is not an injury which is a disease because it cannot aptly be described as having developed in the relevant sense. Where an injury finds its origin in an external traumatic event causing immediate injury and is unrelated to any condition from which the worker is suffering, it is not an injury which is a disease because it cannot be said to have developed."
Counsel for the plaintiff argued that Mr Jordan's PTSD found its origin in an external traumatic event, the fatal collision; that that event caused the immediate onset of PTSD; and that the PTSD was unrelated to any condition from which Mr Jordan was previously suffering. He argued that the PTSD was not a disease because it could not be said to have developed.
I disagree with that analysis. The evidence certainly establishes that Mr Jordan had no pre-existing mental health problems, and that there was an immediate onset of psychological symptoms at the time of the collision. I received very little evidence as to the nature and development of Mr Jordan's symptoms. He gave unchallenged evidence that he had symptoms immediately after the accident, and that his symptoms "developed as time went on". The fact that the symptoms developed indicates that his condition should be regarded as a disease. It appears from medical certificates tendered at the trial that Mr Jordan's general practitioner diagnosed PTSD on 11 January 2012.
In my view Mr Jordan's PTSD should, in the words of the definition of "disease", be regarded as an ailment or disorder of sudden development. It is not an "injury" in the ordinary sense of that word. It is an "ailment" and a "disorder" in the ordinary sense of those words. When Zeeman J spoke of "an external traumatic event causing immediate injury", I think he must have been referring to immediate physical injury. In any event, his comments as to the nature of an injury that is not a disease were obiter.
If I am right in thinking that Mr Jordan's PTSD constitutes a disease for the purposes of the WRC Act, then the plaintiff was liable to pay compensation only if Mr Jordan's employment contributed to that disease to a substantial degree: s 25(1)(b). Section 3(2A) of the WRC Act provides as follows:
"(2A) For the purposes of this Act, employment contributed to a disease to a substantial degree only if it is the major or most significant factor."
His PTSD was caused by the fatal collision. The fatal collision was caused by the negligence of the motorcyclist. That negligence was the major or most significant factor in the causation of the PTSD. The fact that Mr Jordan was driving home after performing certain employment duties does not warrant a conclusion that his employment was the major or most significant factor in the causation of the PTSD. It follows that the plaintiff was not obliged to pay compensation under the WRC Act, and that this action must fail.
If I am wrong about the PTSD being a disease, I would still reach the conclusion that the plaintiff was not liable to pay compensation and that the action must fail. If the PTSD is not a disease, compensation would be payable only if Mr Jordan's PTSD arose "out of or in the course of his employment": s 25(1)(a). Section 25(6)(a)(i) does not apply because Mr Jordan's journey from Mole Creek towards his home did not occur at the request or direction of his employer. Section 25(6)(a)(ii) is not satisfied because there is no evidence that his journey was work-related. The evidence does not establish that he was driving for the purpose of discharging employment duties at Devonport or anywhere else, or that he was driving in the course of his employment. That is to say, there is no evidence that the PTSD arose out of or in the course of his employment. Section 25(1)(a) therefore could not be satisfied.
For these reasons there will be judgment for the defendant.