Justin Shephard v FAW Industries Pty Ltd - [2014] ACTSC 20

JUSTIN SHEPHARD v FAW INDUSTRIES PTY LTD & ORS
[2014] ACTSC 20 (17 February 2014)

NEGLIGENCE – personal injury – claim by employee against employer – low back injury while lifting and carrying lengths of timber – obstacles on ground surface of timber yard – unsafe place and system of work – employer negligent

DAMAGES – personal injury – low back injury – previously degenerate but asymptomatic lumbar spine – disc injury at L4-5 – pain – impairment of earning capacity and enjoyment of life – erectile dysfunction – psychological consequences – reduced capacity to perform domestic tasks

INSURANCE – workers’ compensation – whether plaintiff a working in both ACT and NSW – employer insured by different insurers in both jurisdictions – both insurers liable to indemnify employer – dual insurance

Occupational Health and Safety Act 1989
Civil Law (Wrongs) Act 2002
Workers Compensation Act 1951

CSR Limited v Eddy (2005) 226 CLR 1
Busico v Century Insurance Co Ltd (1969) 14 FLR 189
Dillingham Engineering Pty Ltd v National Employers’ Mutual General Insurance Association Ltd (1971) 1 NSWLR 578

No. SC 629 of 2005

Master Harper
Supreme Court of the ACT

Date: 17 February 2014

IN THE SUPREME COURT OF THE     )
  )          No. SC 629 of 2005
AUSTRALIAN CAPITAL TERRITORY           )

BETWEEN: JUSTIN SHEPHARD
Plaintiff

AND: FAW INDUSTRIES PTY LTD
ABN 99 051 343 269
Defendant
WORKERS COMPENSATION NOMINAL INSURER
ABN 83 564 379 108

First Third Party

INSURANCE AUSTRALIA LIMITED (FORMERLY KNOWN AS NRMA INSURANCE LIMITED)
ACN 000 016 722

Second Third Party

ORDER

Judge:  Master Harper
Date:  17 February 2014
Place:  Canberra

THE COURT ORDERS THAT:

judgment for the plaintiff against the defendant for $725,635.60.

judgment for the defendant against each of the third parties for $725,635.60.

liberty be granted to each third party to apply for contribution against the other if so advised.

the plaintiff’s costs be paid by the defendant.

the order as to costs be stayed for 21 days.

liberty be granted to the defendant and the third parties to apply as to the costs of the third party proceedings.

This is an action for damages for personal injury by an employee against his employer. At the time of the injury the employer carried on business in the Australian Capital Territory and also in New South Wales, and was covered in respect of such claims by insurance policies in each jurisdiction, issued by different insurers. Each of the insurers argues that if the plaintiff succeeds, the employer should be indemnified by the other insurer. In these circumstances the defendant employer has joined both insurers as third parties. All parties are in agreement that in respect of NSW insurance, the proper party is the named first third party, the Workers Compensation Nominal Insurer. The second third party is the ACT insurer.

Both liability and quantum are in issue. My first task is to determine liability as between the plaintiff and the defendant, and to assess damages. If I find in the plaintiff’s favour, I must then proceed to decide whether the defendant is entitled to be indemnified by one of the third parties, or perhaps by both. It is common ground that the defendant will be found entitled to indemnity by at least one of the third parties.

The plaintiff

The plaintiff is a man now aged 38. He was born in 1975 and was 27 at the time of his injury.

He grew up in the Windsor area, west of Sydney. He left school after gaining his school certificate at the end of year 10. He was active in sport at school, and participated with his parents in waterskiing. He worked in various labouring jobs, gaining a ticket to drive a forklift truck and a medium rigid truck.

In 2000 his parents moved to Yass, and in 2002 the plaintiff decided to move to the Yass-Canberra area also. After working as a forklift driver in Canberra for a short time he gained employment with the defendant as a truck driver.

The job with the defendant – the plaintiff’s version

The plaintiff’s evidence was that his father, who was working as a car salesman at a dealership in Yass, had heard from someone at the defendant company that there was a job available as a truck driver. The plaintiff called at the Yass premises of the defendant on his way to work, and introduced himself to the local manager, Mr Shea. He told Mr Shea that he had heard there was a job going, and that he had a truck licence and a forklift ticket. Mr Shea confirmed that the position was available. He told the plaintiff that he would need to go to the head office of the defendant company in Mitchell in the ACT to complete paperwork.

The plaintiff continued on his way to work in Canberra. After work that afternoon he called in to the Mitchell premises to see the managing director of the company, Mr Agnew. The evidence is that Mr Agnew was at least a major shareholder and perhaps the sole shareholder of the defendant, and the governing director. The plaintiff went to the front counter and asked to see him. He introduced himself and gave Mr Agnew a copy of his resume. Mr Agnew told him that there was a position available as a truck driver, which would involve moving building materials from Mitchell to Yass, and deliveries to customers. The plaintiff’s recollection was that Mr Agnew talked to him about wages and conditions, and told him that he could start work the following week. The plaintiff was then living at Murrumbateman. Murrumbateman is a village in NSW on the Barton Highway between Yass and Canberra. The plaintiff said that Mr Agnew told him that he would be permitted to drive his truck home overnight, and to drive to and from work. Mr Agnew then told the plaintiff to see another staff member to complete the necessary documentation for his employment, and said that he would see him the following week.

The plaintiff did not have all the necessary details with him, and took some of the forms home for completion and return the following morning.

The plaintiff was told that the truck would be left at Yass on the following Monday when he was to start work, and that he should go to the Yass branch store to collect the truck.

He did so, and saw Mr Shea. He told him that he was the new driver, coming to pick up the truck. Mr Shea congratulated him on starting the new job and took him out to where the truck was parked. He introduced the plaintiff to another employee who worked at the Yass store. The plaintiff then drove the truck, which did not have a load on board, to Mitchell. Mr Shea told him that the documentation for his work would be at Mitchell and his day would be organised when he got there.

When he arrived at the Mitchell premises, he reported to the front counter, and in due course saw Mr Agnew who showed him around the warehouse. He was shown a tray in which his delivery dockets and other instructions would be placed. His job was to load the truck with the items from the Mitchell depot which had been ordered, and to deliver them to the address he was given. Sometimes the work required him to drive to a supplier, usually at Fyshwick, to collect stock which had been ordered. This was his work from Monday to Friday. Sometimes, in addition, he was required to work on Saturdays at the Yass store for half a day.

The Yass premises were relatively small, with a shopfront, a store and yard for building materials. The Mitchell premises were much larger, with an office, a warehouse, a number of trucks and a high volume of truck traffic.

It was part of the plaintiff’s job to deliver stock, in the form of building materials, from Mitchell to Yass as required.

Initially the plaintiff said that he did not have much knowledge about building materials, and needed help from the other staff. Mr Agnew directed another employee, Ross McCaskill, to help the plaintiff to identify the necessary stock for delivery and to help him load the truck. The plaintiff’s evidence was that almost all of the loading was done by hand. Occasionally a forklift truck would be used, for example to load a pallet of bags of cement.

The plaintiff said that the yard at Mitchell was tight to drive a small truck around and was “a bit chaotic”. A lot of material was stacked on the ground. There were in some places packs of timber stacked six high. The warehouse was covered but the yard was open.

The plaintiff said that on a normal working day he would drive from his home at Murrumbateman in the truck to Mitchell where he would collect delivery dockets from his in-tray, and load the stock to be delivered. He would drive out with a truckload of deliveries. Most deliveries were to building sites in the suburbs of Canberra although some were across the border in NSW. Sometimes his orders required him to collect stock from suppliers, usually at Fyshwick. Sometimes these supplies were to be delivered to a building site. At other times he was to drive back to the Mitchell yard to unload the stock. Occasionally he needed to drive to Yass to unload stock there. The volume of stock delivered to and kept at Yass was very small by comparison with the volume of stock at Mitchell. At the end of the day the plaintiff would drive home to Murrumbateman, either from the Mitchell depot or from his last delivery point. Sometimes he had items which he needed to deliver to the Yass store. He would undertake the delivery to Yass either as the last task of that day, or the first task of the next morning.

The plaintiff said that in contrast to the large warehouse and storage yard at Mitchell, Yass was “pretty much a shopfront with a very small, about the size of a three-car garage out the back where they would stock timber”. The Yass store was really a small hardware shop, selling paint, tools, nails and suchlike to the public and to tradesmen. There were three employees working at Yass and more than twenty working at Mitchell. There was an office at Mitchell where administration and accounting staff worked. The plaintiff was paid by direct transfer to his bank account, and was given payslips at the Mitchell office each payday. Sometimes, on request, he would take the payslips for the Yass store employees to the Yass premises.

The plaintiff explained that the Saturday work at Yass was irregular and was classified as overtime. During the three months from when he started his employment with the defendant until his injury, he thought that he worked for six or seven Saturdays at Yass.

The plaintiff said that he always drove the same truck during his employment. The company had a fleet of about ten trucks of different sizes. The truck he drove was, to the best of his recollection, registered in the Australian Capital Territory. When the plaintiff worked in Yass on Saturday mornings, he generally worked in the shop or tidying the timber yard. He did an occasional delivery around Yass or Murrumbateman.

On a typical weekday, the plaintiff would undertake three or four delivery runs, returning to the Mitchell depot to reload.

The plaintiff said that he was not given any training on the job by any of the defendant’s staff.

The day of the injury

The plaintiff’s case is that he injured his back while lifting and carrying timber to be loaded on the truck at the yard at Mitchell on Tuesday 17 September 2002. His recollection was that it was late morning, and that he had returned to Mitchell to commence his second delivery of the day. He went to his in-tray and collected his delivery docket. He walked back to his truck, going through the list of what was required. He drove the truck to the part of the yard where lengths of hardwood were stacked, to load these on to the truck. He pulled up in an open area a couple of metres from the timber racks. The racks ran the length of the fence line of the yard. The racks were a few metres high. The plaintiff said that he was 6 ft 4 in or 189 cm tall, and the racks were quite a lot higher than that. They were so high that he was unable to reach to the top shelf to get timber down, and a forklift had to be used for that purpose. A lot of the opened packs were stacked on the lower racks where they could be reached. The racks were of tubular steel shelving or scaffolding.

Between the truck and the racks were packs of timber on the ground, a little higher than the plaintiff’s knee level. He had to climb over this timber to get to the racks. The delivery docket required him to load some timber known as Hyspan, which he said came in six-metre lengths. The Hyspan came in planks about four to six centimetres thick and about thirty centimetres wide. The planks were not packed together, and the plaintiff and Mr McCaskill carried them together, two at a time, one on top of the other. They had previously carried Hyspan in the same manner to load the truck. Sometimes there had been a gap between stacks of timber on the ground and it had been possible to walk between the stacks, but on other occasions, including this one, there was no space between, and they had to climb over.

They would slide the planks out of the rack onto their shoulders to carry them at that height. The plaintiff thought that each plank of Hyspan had weighed 15 to 20 kg. They had to climb over the timber on the ground to carry them to the truck and load them onto the tray. They carried the first two planks without incident. As they were carrying the next two planks back to the truck, and as the plaintiff was stepping down off the timber on the ground, he felt a severe pain in his lower back. He managed to get those two planks on to the tray but could not continue further. He sat on one of the packs of timber on the ground. He said that it felt as though his whole spine had knotted up, and that it was the worst pain he had ever felt. He mentioned something to Mr McCaskill about having hurt his back. Mr McCaskill got another staff member to help, and they completed loading the truck. The load was bound for the Yass store, as what the plaintiff called a stock transfer. He thought that he would be able to drive the truck to Yass although not to carry timber. He got into the cabin and started to drive towards Yass. He had gone only a short distance when he felt pins and needles and a burning sensation in both legs, worse in the left leg. He telephoned Mr Shea at the Yass store and told him that he had hurt his back and was in a lot of pain. He was not sure whether he was going to be able to drive all the way to Yass. Mr Shea suggested that he drive to Murrumbateman, and that Mr Shea or someone else from the Yass store would meet him there and pick up the truck.

The plaintiff drove home to Murrumbateman. He telephoned the Mitchell office and said that he would not be able to undertake any further deliveries that day, because he had hurt his back. He went into his house and lay down.

The evidence for the plaintiff as to damages

The plaintiff did not return to work with the defendant after his injury. He went to see his general practitioner at Yass, who prescribed painkillers and anti-inflammatories, and recommended bed rest. He also referred the plaintiff for physiotherapy. The ACT workers’ compensation insurer of the defendant (the second third party) put in place some rehabilitation arrangements through an occupational therapist, but this did not come to much. In due course the defendant terminated the plaintiff’s employment. The second third party made payments of workers’ compensation to the plaintiff, and met his medical expenses. His back pain continued and, he said, never got better. He saw various specialists, on referral by his general practitioner and pursuant to arrangements made by the insurer. He underwent some acupuncture, and went through a course with the Canberra Injury Management Centre, paid for by the second third party. He found that the worst part of this was his travel from Murrumbateman to Canberra to attend the program three times a week. He described driving that distance as absolute agony. The program itself, which included hydrotherapy in a pool, gave him relief for a few hours. He continued with his medication (Panadeine Forte and anti-inflammatories) with some benefit.

During 2004 he developed erectile dysfunction. His general practitioner referred him to a urologist to deal with this.

After the accident he started seeing Zoe, whom he eventually married in 2010. By the time of trial they had separated. The plaintiff blames the failure of the marriage on his injury. Zoe had been a friend of his sister’s. Their sexual relationship was a struggle because of his erectile problems. The urologist, Dr McCredie, prescribed Viagra, which improved things, but sex remained affected by back pain, and the Viagra gave rise to side-effects including severe headaches.

In late 2004 the plaintiff applied for an advertised position as a courier delivering parcels. The employer was based in Mitchell. He stayed in that job for about nine months, but found that the work exacerbated his low back pain.

At some point the plaintiff moved to Yass to live with his sister. He was angry and depressed as well as in pain. He started drinking too much.

He got another job in Canberra as a trades assistant, and worked there for four or five months. He gave it up because the work included heavy lifting.

In October 2006 he got a job driving a concrete truck, delivering concrete to building sites. He was generally able to cope with this work, although a small amount of the work involved delivery to smaller residential building sites where he had to operate the chute into a wheelbarrow. This sometimes involved walking over uneven ground.

In September 2008 he moved from that job to a position as a concrete tester. This was lighter work. It involved driving a utility truck and collecting samples of concrete to be tested. That job came to an end in December 2008 when the plaintiff, after a few drinks, was involved in a road rage incident which culminated in “fisticuffs” and led to his dismissal.

In February 2009 he started work as a milkman, delivering crates of milk to cafes and shops in Canberra. By that time he and Zoe had moved to Canberra. After a few months he went back to work as a concrete truck driver. He continued to drink heavily after work. His physical relationship with Zoe became less satisfactory.

In September 2010 he and Zoe moved to Sydney, and he found work driving a small truck for a company doing contract work for the State Rail Authority. In October 2010 he and Zoe were married.

All of this came to an end for the plaintiff in September 2011. His evidence was that he came home one day and Zoe told him that she did not love him any more. She had not loved him for a long time. She had thought that marriage would resolve these issues but it had not done so. She left him. He was angry, sad, confused and numb. He had given up alcohol on the day of the road rage incident, and had not had a drop of alcohol since then, up to the time of trial. He returned to Canberra to live, to be close to his family. He found work as a concrete truck driver in Canberra.

He said that his back pain was worsened by the cold weather in the winter in Canberra. He continued with stretching exercises, which gave temporary relief. He had some difficulty climbing steps to the cabin of the truck, but driving it was not too difficult. The truck was automatic. His longest delivery trips were about half an hour. His back pain was always there, but at varying levels, and was generally manageable. His work involved some deliveries to residential sites. These were more difficult because he had to unload through a chute from the truck into a wheelbarrow, often over uneven ground. At the end of the working day he was in pain and needed to lie down when he got home.

About six weeks before the trial the plaintiff gave up his work as a truck driver, to begin his own business as a retailer of T-shirts and other clothing through a franchise arrangement. He found this much more satisfactory from a physical point of view. By the time of trial he was still taking Panadol and the occasional anti-inflammatory, depending on the level of his back pain. He had not seen a doctor for about a year. His sleep remained unsatisfactory, and he was tired every day. He felt that his mind was slow and his body was lagged. He had become withdrawn and uncomfortable in groups. He was generally depressed and upset about life. By the time of trial he was living in a rented house with a flatmate, an old friend he had grown up with. He was able to wash up, but found that gardening and lawnmowing aggravated his back pain. His flatmate did most of the outside work, and also dishwashing and clothes-washing, preparation of meals and cleaning of the house. He estimated that he needed help of that kind for about an hour a day.

In about 2008 he made an attempt at snowboarding. He went up the chairlift at Thredbo and got about a quarter of the way down on his snowboard when he felt what he described as a massive pain in his back. He said that he had to be taken from there to the medical centre at Thredbo on a stretcher, and that his drive from Thredbo to Jindabyne, where he was staying, was probably the worst drive he had ever experienced in his life. Since then he had been to the snow but had not attempted snowboarding again.

The plaintiff hoped that his new business would be successful, but accepted that if it did not work out he might have to go back to driving a cement truck, or to courier work. He still had a utility which he was able to drive, though he tended to avoid long-distance trips.

The plaintiff’s case in relation to damages was supported by evidence given by his sister, Fiona Cogger. She and the plaintiff were living together at Murrumbateman at the time of the accident, sharing a rented house. After the accident the plaintiff could not do much around the house, and she had to attend to all of the usual household chores. She was working in Canberra during the week, but estimated that during the first eighteen-months after the accident she spent an average of two hours a day doing jobs around the house which the plaintiff had previously done. At the end of that eighteen month period Ms Cogger moved to Perth to live. Her recollection was that the demands upon her had somewhat reduced by the time she left, and that the plaintiff had over time been able to do a little more.

She said that the plaintiff started drinking a lot after the accident and became isolated and depressed.

Ms Cogger returned to the Canberra area after six or seven months in Perth but did not move in with her brother. She had a baby during 2005. After her return she continued to see her brother regularly. During 2012 she moved in to share a house with the plaintiff again. He moved out after about six months. During that period she said that the plaintiff had improved considerably but she still needed to spend an average of half an hour a day attending to tasks around the house which he was unable to cope with. She confirmed that by the time she gave her evidence her brother had stopped drinking and, she said, was trying to get his life back together. He had become more outgoing and less isolated.

Ms Cogger’s evidence was not challenged.

The defendant’s evidence on liability

Evidence was given by Mr Agnew, the principal shareholder and managing director of the defendant company; Mr Shea, the manager of the Yass store and yard at the time of the plaintiff’s injury; and Mr Cox, who had then been a despatch officer and yard supervisor with the defendant company at Mitchell. By arrangement between those representing the defendant and the third parties, these witnesses were called and examined in chief by Mr Cranitch SC representing the second third party. I treat the evidence as having been called on behalf of the defendant and both third parties.

Mr Agnew’s evidence was that his company had been in operation for about twenty- five years. He had commenced business at Queanbeyan in New South Wales but a number of years ago had consolidated the company’s activities in the ACT. He opened the Yass branch office in 2002 and appointed Mr Shea as manager. He said that he had authorised Mr Shea to run the Yass office as effectively a separate business, with power to hire and fire his own staff, and to make his own decisions about what stock to order and sell. He was also responsible for getting his own customers. The only work done at Mitchell was the administration, including payment of wages and salaries and superannuation, payment of accounts, and keeping of records. Mr Shea had autonomy to make his own purchases, but the invoices would be paid at Mitchell. Quite often there would be staff at Yass who Mr Agnew did not know Mr Shea had even employed. He was not sure whether Mr Shea had a practice of asking his employees to introduce themselves to Mr Agnew at Mitchell, but he said that the Yass employees in practice did so.

The suggestion was put to him that Mr Shea had engaged the plaintiff subject to his (Mr Agnew’s) final approval. He denied this.

In about 2004 he had started another branch store at Jerrabomberra in NSW, but this lost money and by the time of trial he had closed it down.

He said that the product range at the Yass store was different to that at Mitchell. Stock at Mitchell was generally of higher quality.

By the time of the hearing Mr Agnew had also closed down the Yass branch. The company was still operating at Mitchell, where he had added a hire company and a property development business.

Mr Agnew’s recollection was that in 2002 the company had had about a dozen trucks. There was one truck allocated to the Yass store, which was known within the company as the Yass truck. He said that there was still a Yass truck although the Yass store had been closed and the driver of the Yass truck was based at Goulburn. The other trucks had informal names, for example, Big Shane’s truck and Rocky. He thought that the Yass truck might have still been the same truck as in 2002 but he was not sure about this. The other trucks were all based at Mitchell. In response to a leading question, Mr Agnew said that the Yass truck had been associated in 2002 solely with the Yass business, but subsequently qualified this answer to say that the Yass truck was sometimes used for other deliveries, including deliveries to sites in the ACT. Asked who was responsible for giving directions as to how the Yass truck was to be used, Mr Angew said that Mr Shea held that responsibility, the only exception being that the despatch manager at Mitchell could intervene if he needed something done by the Yass truck urgently.

In cross-examination by senior counsel for the plaintiff, Mr Agnew said that he had no recollection of whether the plaintiff had come to see him at the time of his engagement. There would have been, he said, no reason for him to have looked at the plaintiff’s truck licence or forklift ticket. That would have been a matter for Mr Shea at Yass.

Mr Agnew was asked to agree that when the plaintiff was engaged in 2002 the Yass operation had been running for only a matter of months, since earlier in 2002. Mr Agnew agreed that that sounded about right although he was being asked to recall events of ten years earlier and had a busy life.

Mr Agnew explained that the system was that the takings of the Yass branch would be brought by the Yass truck driver to Mitchell every day for banking. There was a full-time accountant based at Mitchell. All arrangements for insurance were done at Mitchell.

At one point during the cross-examination, senior counsel for the plaintiff asked Mr Agnew whether there would have been occasions for a driver to drive to Fyshwick to collect stock which was unavailable in the Mitchell store. His response was that he could not see what relevance that had. Pressed, he agreed that there were occasions when his drivers had had to pick up stock from Fyshwick. It was put to him that there had been occasions where his delivery drivers would have to pick up stock from Fyshwick or elsewhere and bring it back to Mitchell. He responded that they would take it back to Yass “if they needed Yass product”.

Mr Agnew agreed that during 2002 the bulk of the deliveries of his company trucks had been to sites in the ACT, and that on occasions the driver of the Yass truck had been co-opted to deliver goods in the ACT. He disagreed that the bulk of the plaintiff’s work had been carried out in the ACT, and denied that the plaintiff had started work every morning at Mitchell. He also disagreed that the plaintiff had picked up delivery dockets from a box at the front office at Mitchell.

He could not recall whether he had asked Mr McCaskill to help the plaintiff when he was first employed, although he agreed that that might have happened.

He was asked whether the system in 2002 had included the stacking of packs of timber in front of the scaffolding racks. He agreed that timber could have been stacked in front of the racks and that this might have impeded his employees getting access to the racks.

He thought that the company would have had an occupational health and safety policy of some description in 2002. It would have been a developing policy. He had no recollection of a survey being carried out by NRMA Insurance, the ACT workers’ compensation insurer, during 2003. He did not recollect having seen a report of the survey. If it had happened, one of his managers would have seen it but he might not. He was shown a copy of the survey report but had no recollection of having seen it before.

He was asked whether there had been any changes between September 2002 when the plaintiff was injured, and March 2003 when the survey was carried out, in relation to compliance with occupational health and safety requirements. His answer was that there would probably have been some improvements during that period, saying “we’re always trying to improve things”. He thought it was a fair statement to say that in September 2002 the company’s position as to occupational health and safety compliance would have been no better than what was shown in the survey report of March 2003.

A number of matters arising from the plaintiff’s evidence about his first day on the job were put to Mr Agnew but he had no memory of the events of that day.

The company had two yards at Mitchell. Mr Agnew said that Mr McCaskill had worked at the bottom yard, some streets away from the top yard which was at the same site as the office. He did not recollect that Mr McCaskill had worked at the top yard for about three months including the time of the plaintiff’s injury, and said again that this was something which had happened ten years earlier. He said that he had probably had 300 staff during those years. Senior counsel for the plaintiff put to Mr Agnew that he had no real recollection of the events surrounding the plaintiff’s employment in June 2002 and the period leading up to his injury in September 2002. His answer was “one thing I do know, is Steve Shea run his own race and he employed, hired, fired and he run that entire business. That I do recall”.

A few questions later, senior counsel for the plaintiff put again to him that he had no independent recollection one way or the other about the employment of the plaintiff. He replied “I know how my business works generally, in the sense that managers are paid to do a job and Steve was paid to do a job. He run his own race, he employed his own people”.

Senior counsel for the plaintiff pressed the question. In relation to the employment of the plaintiff and his working for the defendant company, he asked Mr Agnew “What do you remember about him?” Mr Agnew’s reply was “I don’t”.

He thought that the Yass truck had probably been registered in the ACT and transferred to the Yass business when it started in February 2002.

Mr Agnew was asked whether his company had paid payroll tax in the ACT for all of its employees, including the Yass staff. His answer was a little difficult to follow but he seemed to say that this was something which his employed accountant would have looked after, and outside his own knowledge.

Mr Agnew said that the Yass business had built up substantially over the years. Eventually there was about $700,000.00 worth of stock at Yass. Mr Agnew was a little critical of Mr Shea as to stock control and cash flow, expressing some frustration that Mr Shea would order and purchase stock without regard to cash flow. Mr Agnew thought that in 2002 there would probably have been stock kept at the Mitchell premises worth about $2.5 m.

By the time of the hearing Mr Shea was living on and running a property at Galong in NSW, and also working as a builder. His evidence in chief was that he started working with the defendant company in about February 2002 as branch manager of the Yass store and storage yard from the time it opened. They had started with a utility and in the early stages were given a truck from Mitchell. He said that he was responsible for hiring and firing for the Yass store, and would have employed half a dozen truck drivers between the time the store opened and the engagement of the plaintiff, some four months. They employed only one driver at a time. They advertised when a position was available, and it also became known by word of mouth around the Yass community. He would interview applicants and would offer the successful applicant the job. He would then send them to Mitchell to complete paperwork and to meet Mr Agnew. By that time he had made the offer of employment and it had been accepted by the employee.

He remembered knowing the plaintiff’s father, and interviewing the plaintiff for the job as truck driver although he could not recall the words used during his conversation with the plaintiff. He had followed his usual practice, and at the end of the interview he had offered the job of truck driver to the plaintiff. He had sent the plaintiff to Mitchell to complete the formalities and to meet Mr Agnew.

He said that the truck was stationed at Yass. He could not remember whether he had immediately allowed the plaintiff to take the truck home at the end of his working day, but that had been his normal practice with a new driver after the first couple of days if everything was satisfactory.

Mr Shea said that he had been responsible for directing the driver of the Yass truck as to his day-to-day activities. He had done this either by telephone or at the Yass shop. The driver had begun the majority of his work each week at Yass, although there were occasions when he commenced at Mitchell. If he had not needed the truck at Yass first thing the next morning, it made sense for the truck to go to Mitchell first, to bring building materials back to Yass. His estimation was that the driver started work at Yass three or four days a week. Most deliveries from Yass were to the Yass region, including Murrumbateman. From time to time the Yass truck would be needed by Mitchell for Canberra deliveries. This would be arranged by discussion between Mr Shea and the despatch officer at Mitchell.

Mr Shea’s evidence was that he talked to the plaintiff about his work for any particular day in the morning and then by telephone, three or four times a day as arrangements about deliveries were altered and matters of urgency needed to be dealt with. Mr Shea’s recollection was that the Yass truck was registered in NSW.

He said that at the Yass premises there was a staff commonroom where employees kept articles of clothing. The company had a livery, that is T-shirts and jumpers with the company logo.

Mr Shea’s estimate was that the plaintiff spent 70 % of his time working in NSW and 30% in the ACT.

In cross-examination by senior counsel for the plaintiff, Mr Shea said that to his recollection there had been four employees at the Yass store in June 2002, including the plaintiff. The others were a storeman and a shop assistant. The Yass store primarily sold items to customers off the street, and delivered around Yass.

Mr Shea corrected his evidence about the number of truck drivers he had employed up to the time the plaintiff started work. He said that he ran the Yass store for about eight years, and there had been six drivers over that entire period. He was asked again how many drivers he had engaged prior to the plaintiff starting in June 2002. He thought there had probably been three drivers prior to the plaintiff. He could not remember their names with any accuracy, or the periods they had been employed. He agreed that the truck had been already owned by the defendant, and had come across from Mitchell, in about his second week as manager at Yass. He said that the utility truck had definitely been registered in NSW but he could not be certain about the large truck.

He agreed that the Mitchell warehouse had been ten times the size of Yass in terms of storage space. He also agreed that in 2002 there had been far more building work going on in the ACT than in the area of NSW serviced from the Yass store.

Mr Shea was asked in cross-examination whether he had had a routine for employing new staff prior to taking on the plaintiff. His answer was that he would say that the plaintiff had been employed in the same way that he had employed others earlier. It had been up to him to hire them. He would conduct an interview and if he was happy with the applicant they would go to the next level. The next level, he agreed, was to Mr Agnew. Mr Shea was asked whether Mr Agnew would make the decision to employ a new staff member. His answer was that “Mick was always very supportive and if I was happy with it, he was happy to go with them”. It was then put to him that the final decision was Mr Agnew’s. He responded “Well, obviously Mick was the owner of the business, so yes”. He said that there was no set occupational health and safety policy for Yass. He thought that there had been such a policy in writing for Mitchell. (No such written policy was produced in response to a call, nor had any such document been identified on discovery.)

Mr Shea agreed that the truck driven by the plaintiff had never been garaged at the Yass premises.

Senior counsel for the plaintiff put to Mr Shea that the volume of orders for Yass had been infinitesimal compared to those for Mitchell. Mr Shea agreed with this. It was then put that every morning, apart from the Saturdays when the plaintiff worked at Yass, he would turn up at the Mitchell store to collect his deliveries for the day. Mr Shea agreed with this proposition. He also agreed that the plaintiff would then undertake deliveries in and around the ACT before driving to Yass with any stock for delivery there. He agreed that the plaintiff took the truck home after his last delivery from Mitchell. Mr Shea said that when there was room on the truck coming back from Mitchell, he would try to make sure that the space was filled with stock for the Yass store, so that they could keep the yard at Yass adequately stocked.

Mr Shea agreed that on the day he first met the plaintiff, there had been no appointment made for an interview. The plaintiff had come in off the street and introduced himself. Mr Shea could not remember the interview in any real detail. He agreed that he had previously known the plaintiff’s father. He thought that it had come about following a casual conversation with the father about the vacancy. Mr Shea could not remember the plaintiff giving him a copy of his resume, nor could be remember checking the plaintiff’s driving licence. He did not think that there had been any paperwork filled out at the time of the interview, and he agreed that he would not have sent a fax to Mitchell saying that he had interviewed the plaintiff and recommended him for the job. He agreed that he had told the plaintiff that he had to go to Mitchell, and he agreed that the final decision about employment was a matter for Mr Agnew. Mr Shea said that he had not had any conversation with the plaintiff about a date for starting work, and could not remember any conversation about wages. He could not remember any detail of conversation about how much notice the plaintiff had had to give to his then employer in Canberra, or about picking the truck up from Yass. He had a recollection of talking to the plaintiff but could not be any more specific about what was discussed.

As to the staff room at Yass, Mr Shea did not think that employees had their names on their company T-shirts or fleece jackets. There had been unmarked jumpers at times, but he could not actually say that any of them had been those of the plaintiff.

Mr Shea agreed that it was part of the plaintiff’s duties to drive to Fyshwick to collect stock from wholesalers, and take the stock to the Mitchell yard. Orders about that stock would have come from Mitchell. He would be asked by Mitchell staff whether it was all right for them to use the truck for that purpose, and he would agree.

He said that Hyspan timber had not been stocked at Yass. If it was ordered by a Yass customer, it would have to be delivered from Mitchell, and that would have been one of the plaintiff’s tasks. He said that Hyspan was up to 13 metres in length, but to fit on the plaintiff’s truck it would have to be no more than six metres. He accepted that a six metre plank of Hyspan would weigh about 50 kg.

Mr Shea had a recollection of being told by the plaintiff that he had hurt his back, and a vague recollection of going to Murrumbateman to pick up the truck.

It was put to Mr Shea again that the decision to employ the plaintiff had ultimately been one for Mr Agnew, and he accepted this proposition.

Mr Shea had not been asked to give evidence about these events until a few days before the hearing, more than ten years after the injury. He had not prepared a statement to form the basis of his evidence. It had been about five years since he had left the employment of the defendant by the time he gave his evidence. The case related to incidents that he did not remember a great deal about.

Mr Shea agreed that directions to the plaintiff to make deliveries in the ACT, and at sites outside the immediate Yass region, had not been his.

As Yass manager, Mr Shea had had nothing to do with arranging insurance, or notification of claims to insurers. All of that had been done through Mitchell. He had not notified the workers’ compensation insurer about the plaintiff’s injury, and had not known the identity of the insurer.

In re-examination, Mr Shea said that Mr Agnew had never vetoed the employment of an applicant with whom he had reached an agreement for employment, and that Mr Agnew’s involvement had been a matter of courtesy. He accepted that Mr Agnew had been the boss and had the power to hire and fire even himself, but in terms of people under his control, the hiring and firing had been his responsibility.

The other witness called on behalf of the defendant and the third parties was Jason Cox. In 2002 he had been employed by the defendant as despatch officer. He had also been responsible for running the yard at Mitchell. By the time of the hearing he had left the defendant and was managing a motel at Cowra.

His evidence was that he had been responsible for sorting deliveries as they came in and organising the yard staff to load trucks, at times assisting with the loading. He was asked about any relationship he had had to the Yass store. He said that Mr Shea had run the Yass store and organised his own deliveries. When there had been stock to be collected from Mitchell, Mr Shea would send his truck over, and Mitchell staff would load it. Delivery would then take place from the Mitchell yard. He said that there had been a truck allocated to the Yass store but sometimes the trucks were interchanged.

Mr Cox remembered the plaintiff working as a driver for the company. There had been a box allocated to the Yass store at the office, where delivery orders and dockets would be placed. There had been a number of other boxes for particular suburbs and areas. There had been occasions where he had needed to use the Yass truck for deliveries. He said when this happened he would contact Mr Shea. When the Yass truck arrived he would use it for local ACT deliveries, and in particular for deliveries on the way back towards Yass. This use of the truck occurred only with Mr Shea’s approval.

Mr Cox started in about 1998 with the defendant and left in about 2010. He was based generally at Mitchell for the whole of that time although he said that he did some stints in Yass, helping out in the shop if Mr Shea was away.

Mr Cox had not seen the plaintiff for ten years before coming to court to give evidence. He had not seen him since just before the injury. When he was asked to give evidence he was not sure whether he remembered what the plaintiff looked like. When he saw him in the court foyer he recognised him and introduced himself. He did not think that there had been an occupational health and safety policy in place at the time of the plaintiff’s injury, although he thought that something had been put in place by the time he left in 2010.

Mr Cox’s recollection was that the plaintiff was used regularly for ACT deliveries from Mitchell, as well as for deliveries from Yass, and that the plaintiff would have had to collect building materials from suppliers at Fyshwick from time to time, but he was unable to say what percentage of the plaintiff’s work had been in the ACT as opposed to NSW.

The documentary evidence relating to liability

Ross McCaskill died before the trial. A statement he had made in May 2003 to an investigator engaged by the second third party was tendered without objection. He said in the statement that he had been employed by the defendant for the last three years, since 2000, as a yardman and forklift driver. His duties included helping loading trucks by hand. He was working at the time he made his statement at the bottom yard in Callan Street, Mitchell, but until January 2003 he had worked at the top yard, about a kilometre away, in Vicars Street (the site of the defendant’s office and shop). He had been working at the top yard when the plaintiff hurt his back. He remembered helping the plaintiff load his truck on a number of occasions, but did not remember any particular incident where he suffered an injury. He remembered helping the plaintiff lift timber up to six metres in length from the racks, and helping him load them onto the tray of his truck. It was common to have to step on to and over low stacks of timber, up to half a metre high, in this process. He had a recollection of seeing the plaintiff walking as though he was in pain, and he remembered the plaintiff telling him that he had pain in his back. He had no particular recollection of this incident being linked in time with helping the plaintiff load a truck. He said that it was more than possible that the plaintiff had hurt himself while he (Mr McCaskill) was helping him, but he did not recall the plaintiff saying anything to him about such an incident.

The solicitors then acting for the plaintiff obtained an expert report from Dr B N Emerson, a professional engineer with a doctorate in mechanical and industrial engineering, and qualifications and experience in occupational hazard management and safety in the workplace. Dr Emerson was an adjunct lecturer in occupational health and safety and safety management at the University of Western Sydney and also lectured at the University of Technology, Sydney. There was no challenge to the tender of his report. He died before the hearing.

Dr Emerson had been asked to assume that the timber being carried by the plaintiff at the time of his injury was in planks of 6 m x 150 mm x 50 mm weighing between 36 kg and 40 kg, and that the timber had been carried by the plaintiff and another employee. His assumptions included the presence on the ground of timber which they needed to climb on to and step down from while carrying their load. He assumed that the plaintiff in the course of carrying the timber from the rack to his truck had assumed a twisted spine posture and had bent forward pivoting from the hip joints and at the same time taking on a disproportionate share of the lift as he stepped down, and that in the course of stepping down while twisting in a poor posture he had injured his back. He also assumed that the plaintiff had received no proper instruction in manual handling of materials or group lifting techniques.

He noted that the load on the plaintiff was likely to have been well in excess of the recommended lifting limit of 16 kg specified by the Occupational Health and Safety (Manual Handing) Regulation 1991, then in force in the ACT.

His opinion was that the defendant had not provided the plaintiff with a safe system of work, and had failed to take adequate care for the plaintiff’s safety. The timber on the ground restricting access to the racks should not have been there. The plaintiff should not have been expected to step on to and over a pack of timber in that way. He should not have been expected to carry timber across the uneven surface caused by the presence of the timber on the ground. It would have been possible to provide mechanical assistance for the lift. Dr Emerson’s opinion was that the plaintiff had been at foreseeable risk of injury by reason of the system and the lack of training. The employer should in his opinion have carried out a risk assessment. This had not been done. Dr Emerson took the view that the employer had been in breach of the regulation, and also in breach of s 37 of the Occupational Health and Safety Act 1989, which required an employer to take all reasonably practicable steps to provide and maintain a working environment (including plant and systems of work) which was safe for employees and without risk to their health. It appeared to Dr Emerson that the employer had also failed to comply with that section to the extent that it required an employer to provide to employees the necessary information, instruction, training and supervision to enable them to perform their work in a manner which was safe and without risk to their health; and also to develop and maintain a policy relating to occupational health and safety which achieved those ends. The injury to the plaintiff’s low back had in Dr Emerson’s opinion been caused by the defendant’s failure to provide a safe system of work within a safe place of work.

The solicitors acting for the plaintiff qualified another engineer, Mr David Dubos, in June 2011. Mr Dubos has qualifications as a safety engineer and ergonomist. His report was also admitted without objection. He was asked to make the same assumptions as Dr Emerson had made. Whilst he disagreed with Dr Emerson on some matters of detail, he agreed generally with his conclusions. The areas of disagreement did not affect Dr Emerson’s total assessment. He generally agreed that the injury to the plaintiff’s low back was due to the unsafe system of work and the unsafe place of work.

Dr Emerson had not had the opportunity to inspect the defendant’s premises. Mr Dubos had not had that opportunity when he prepared his first report, but in October 2011 he inspected those premises with the plaintiff and his solicitor. His opinion was not altered by anything he saw on the inspection.

No expert evidence on the issue of liability was called or tendered on behalf of the defendant or the third parties. Senior counsel for the second third party mounted a challenge to the expert reports tendered on behalf of the plaintiff, on the basis that the assumption as to the length and weight of the timber being carried was inconsistent with the other evidence.

The plaintiff’s evidence was that the timber planks were 6 m long, about 30 cm wide and 426 cm thick. The dimensions are if anything a little greater than those assumed by Dr Emerson and Mr Dubos. The plaintiff was asked in chief to give the court an estimate of the weight of one of pieces of timber. His answer was that it was hard to say but they were probably within a range of 15 to 20 kg. He accepted this range again during cross-examination. But the evidence of the late Dr Emerson was that a piece of hardwood of those dimensions would weigh 42 to 45 kg. Mr Dubos agreed with this. There was no challenge to their reports. It seems to me that their opinion is more likely to have been accurate than the opinion expressed by the plaintiff in the witness box. Accordingly I generally accept the assumptions on which the opinions of Dr Emerson and Mr Dubos were based.

Senior counsel for the plaintiff also tendered a copy of the workplace assessment report conducted on behalf of the second third party in March 2003. There was no objection to the report, and I am satisfied that the survey was properly carried out. On any view the defendant fell far short of expectations in relation to occupational health and safety. The findings in the report include that there was no occupational health and safety policy in force, and that staff were not aware of any such policy. There were no known occupational health and safety management plans or formal procedures. No formal responsibility for occupational health and safety had been assigned within the company to any staff member. No audits or reviews had been undertaken. There had at some earlier time been an occupational health and safety committee but it had not met for more than two years before the assessment. There were no formal or informal processes in place for hazard identification, or for risk assessment and control. In this regard particular mention was made in the report of manual handling of timber. Any identification of hazards was said to be incidental. There were no formal or informal safe work processes in place, and in this regard manual handling was again mentioned as a major risk area. The company had given no consideration to ergonomics, or to training of staff in relation to ergonomics. There was no safety induction or training for employees, although by the time of the report there were initiatives under way to introduce induction for new employees. No formal meetings with staff took place. No analysis was undertaken of data as to injuries or incidents, and minimum records in this regard were kept. The author of the report gave the company a mark of 31.75%, against an industry average of 92.07% for safety management system findings, and a mark of 56.67% for physical findings and observations against an industry average of 100%.

It is difficult to avoid the conclusion that during 2002 the company had very little if anything in place by way of an occupational health and safety policy or system.

The medical evidence

No oral medical evidence was called. On behalf of the plaintiff a large volume of reports and notes by treating doctors was tendered without objection. These included the plaintiff’s general practitioner at Yass Dr Owen Graham; Dr Justin Pik, neurosurgeon; Dr Garth Eaton, occupational physician; Dr Simon McCredie, urological surgeon; and Dr Mark Sheridan, neurosurgeon. In addition medico-legal reports commissioned by the solicitors for the plaintiff from Dr Christopher Canaris, psychiatrist, Dr Graeme Griffith, consultant surgeon; and Dr K N Chandran, neurosurgeon, were tendered.

Reports were tendered on behalf of the defendant and the third parties by Dr Nicholas Burke, occupational physician, and Dr Anthony Bookallil, neurosurgeon. There is not much disagreement between the doctors.

Dr Pik referred the plaintiff for an MRI scan of the lumbar spine, which revealed an extruded disc at L4-5 compressing the dural sac with marked canal stenosis and possible irritation of the L5 nerve roots. There were also disc protrusions at L2-3 and L3-4, and a bulge at L5-S1. Dr Pik suggested that surgery might be beneficial but accepted the plaintiff’s decision not to proceed with surgery having regard to the risks involved. Dr Sheridan, who was brought into the matter to give a second opinion, also thought that the plaintiff would benefit from surgery, and recommended that he go back and see Dr Pik about this. Dr Sheridan expressed the view that the plaintiff’s disability was solely the result of the work injury in September 2002.

Dr Graham sent the plaintiff to Dr McCredie because of complaints of erectile dysfunction. The plaintiff had some success in overcoming this with Viagra but it’s benefits were outweighed by its negative side-effects. Dr McCredie thought that the erectile problem was a result of the back injury, and that any long-term solution would be dependent on treatment for the back injury. Dr McCredie expressed the opinion in May 2008 that the plaintiff’s erectile dysfunction was probably permanent and irreversible, although it could be helped with Viagra.

Dr Canaris saw the plaintiff in January 2006. He diagnosed an adjustment disorder with depressed mood against the background of a chronic pain disorder, complicated by a significant period of alcohol abuse and a degree of erectile dysfunction. He thought that the plaintiff’s psychological problems stemmed in large measure from his chronic pain and the loss of his previous physical leisure and work activities. He pointed out that chronic pain and depression frequently occurred together and mutually exacerbated one another. Dr Canaris thought that the plaintiff would benefit from twenty to thirty sessions with a psychiatrist experienced in pain management.

Dr Chandran saw the plaintiff in October 2009. He thought that the disc protrusion had improved over the years since the injury. The plaintiff still had periodic symptoms in the back with some referred pain down both legs. He did not, in Dr Chandran’s opinion, require surgical intervention, but he remained likely to have recurrent symptoms, particularly if he engaged in heavy physical work or prolonged standing. He might need physiotherapy and analgesics from time to time in the future. His erectile dysfunction was not due to neurological compression but arose from his back pain and from psychological factors. He was not fit to return to heavy physical work involving repeated bending or lifting anything heavier than 10 kg.

The plaintiff’s solicitors sent him to a psychologist for assessment in November 2009. The psychologist, Mr Van Meurs, expressed the opinion that the plaintiff suffered from a major depressive disorder, a pain disorder and an adjustment disorder with anxiety. He thought that the plaintiff would benefit from twelve sessions of counselling with a clinical psychologist or a psychiatrist.

Dr Eaton first saw the plaintiff in June 2003 on referral from Dr Graham. On examination he had marked restriction of all back movements, and reduced straight leg raising on both sides. Dr Eaton thought that he would benefit from a supervised exercise and pain management program. He thought that the plaintiff’s desire to avoid surgery was reasonable at that time.

Dr Eaton saw the plaintiff again at the request of his solicitors in March 2010. He had not seen him since late 2003 until then. The plaintiff continued to complain of low back pain most days, with occasional leg pain. On examination his back movements and leg raising remained restricted. Dr Eaton diagnosed persistent spinal pain due to a degenerate L4 disc consequent upon the injury of September 2002. His exercise and stretching regime was appropriate. Future surgery could not be entirely ruled out. He might need analgesics and physiotherapy from time to time in the future. He was likely to suffer from continuing persistent intermittent low back pain of fluctuating severity, with flare-ups from time to time. He had probably had pre-existing degenerative changes in the lumbar spine before his injury but these had been asymptomatic and would not have spontaneously led to injury or back pain. Dr Eaton thought that the plaintiff’s work capacity had been permanently compromised for employment requiring heavy lifting, or extreme bending and twisting of the spine. The plaintiff was coping by that time with work which involved driving a small concrete truck, and this seemed appropriate for him.

Dr Griffith saw the plaintiff on two occasions, in September 2009 and May 2012. He spent some 90 minutes with the plaintiff on each occasion. He took a detailed history and conducted an extensive physical examination. The history was generally consistent with the other evidence in the case. Dr Griffith thought that the plaintiff’s symptoms and complaints were entirely related to the work injury in September 2002. There was no reason why he should have developed a disc protrusion spontaneously in the absence of trauma. He was unlikely to come to surgery, but would have continuing disability and exacerbations of back pain from time to time. He was likely to remain symptomatic but at a manageable level. He was able to work as a concrete delivery driver but not in heavier work. He was suffering from a chronic pain state which was likely to continue at a variable level which was intrusive but not of such severity as to prevent him from working full-time as a concrete truck driver.

Dr Burke saw the plaintiff in May 2011. His diagnosis was of a probable disc protrusion at L4-5 against a background of pre-existing but asymptomatic degenerative changes in the lumbar spine. His opinion was that the plaintiff had managed to minimise his working disability in an impressive manner. He thought it likely that there had been some resolution of the disc protrusion in the years since the injury, but that the injury was continuing to contribute to his symptoms. He was fit to work provided that he avoided repetitive or heavy lifting, and repeated bending and twisting. He thought that the plaintiff would have been completely unfit for work for twelve months after the injury. The impact on his ability to lead a normal life remained significant, in that he had been unable to return to his vigorous sporting and leisure activities. As against that, he was capable of outdoor maintenance such as mowing the lawn and in Dr Burke’s opinion did not require ongoing domestic assistance. His prognosis was guarded and there was unlikely to be any significant further improvement. Generally Dr Burke found himself in agreement with Dr Eaton.

Dr Bookallil saw the plaintiff in July 2011. He generally agreed with Dr Burke. He thought that the plaintiff should not attempt to lift weights heavier than 10 kg. Surgery soon after the injury would probably have resolved the right leg pain but might not have reduced the back pain. There was no longer any specific treatment likely to result in resolution of the injuries, and the symptoms were likely to persist indefinitely, with temporary relief provided by medication. Dr Bookallil thought that the plaintiff needed, and would continue to need, domestic assistance of about ten hours a week, because of various tasks which he was unable to perform himself.

Liability

In considering the oral evidence, I take account of the fact that the witnesses were giving evidence about events of more than ten years earlier. It is inevitable that over this period of time memories will have faded and will be much less reliable than they were two or three years after the events.

Having said that, I generally accept the evidence of the plaintiff. I found him an honest and truthful witness with no particular emotional axe to grind. It was suggested in address that he had tailored his evidence to implicate the ACT insurer rather than the NSW insurer, perhaps because he believed that this would be to his advantage in the assessment of damages. This was not put to him in cross-examination. I see no reason to think that by the time of trial the plaintiff believed that it would make any difference to the outcome of the case so far as he was concerned, whether he was found to have been engaged in the ACT rather than in NSW, or to have carried out a particular proportion of his work in one jurisdiction or the other. His evidence about the circumstances of his injury was not seriously challenged.

On the other hand, I gained the impression that Mr Agnew had some emotional investment in having the plaintiff found to have been engaged in NSW and to have done most of his work in NSW. I am not sure why this would make a difference to Mr Agnew, although I note that his company no longer has a store or place of business in NSW. I thought that he was a little annoyed and frustrated at having to give evidence. This was perhaps understandable having regard to the fact that the action related to events of ten years earlier and that the dispute between insurers had not been resolved.

Mr Agnew conceded that he had no recollection of the plaintiff’s engagement or the commencement of his employment. I suspect that the position may well be that as the years went by he extended greater authority to Mr Shea at Yass to hire and fire his own staff, but that this point had not been reached by the time the plaintiff was engaged, only about four months after the opening of the Yass branch.

I also thought that Mr Agnew was a little defensive about his company’s compliance with occupational health and safety requirements, and that he tended to blame others rather than take responsibility himself for shortcomings within the company. Where the plaintiff’s evidence was at odds with that of Mr Agnew, I prefer the evidence of the plaintiff.

Mr Shea also frankly conceded that he had no clear recollection of the plaintiff’s engagement, and that he was relying on his memory of his usual practice of engaging staff. As I have said, I think it likely that his usual practice developed over the years. At some points in his evidence he agreed that the final decision about employment of a new staff member was one for Mr Agnew.

I accept that the volume of business of the Yass branch increased substantially over the years while Mr Shea was manager. He conceded that his memory of events of 2002 was not particularly reliable. I think it likely that by the time of the trial he had very little recollection of the work at Yass between June and September 2002, and in particular as to how the work during that period compared with the amount of work in his later years there.

I generally accepted the evidence of Mr Cox, again with the proviso that his recollection would not be completely reliable about events so long ago. His evidence really went only to the question of where the plaintiff reported for work in the morning, and what proportion of his time he spent working in the ACT as opposed to NSW. His evidence was not particularly helpful to either plaintiff or defendant on those issues.

I take the view that Ms McCaskill’s statement is likely to have been accurate. He can generally be seen as independent, although he was still an employee of the defendant when he made his statement. The statement was made a matter of months after the incident. It is unsurprising that even then he had no recollection of a particular incident causing injury to the plaintiff. The plaintiff came across to me as a fairly stoic individual, unlikely to make much fuss about his injury in front of Mr McCaskill at the time. It would not have been immediately apparent that the injury was a severe one, and in those circumstances it was not an incident that someone in Mr McCaskill’s position would have been expected to remember in any detail. His evidence is not really inconsistent with that of the plaintiff.

I accept the conclusion of the expert witnesses, the late Dr Emerson and Mr Dubos, to which there was no real challenge other than as to the weight of timber being carried by the plaintiff and Mr McCaskill at the time of the incident. As I have said, I accept the evidence of Dr Emerson as to the likely weight of the timber rather than that of the plaintiff, and I am satisfied on the expert evidence that the injury to the plaintiff was relevantly caused by the defendant’s unsafe system and unsafe place of work. In these circumstances the plaintiff has established that the defendant was negligent and is entitled to judgment against the defendant.

Damages

The plaintiff’s low back injury has been a serious one, with severe consequences. Senior counsel for the plaintiff seeks an award of $275,000.00 for general damages for pain and suffering and loss of enjoyment of life. Senior counsel for the second third party, who addressed on damages for the defendant and the third parties, submitted that an appropriate range would be $90,000.00 to $100,000.00.

The range put on behalf of the plaintiff seems to me well above the figures customarily awarded for such injuries in this Territory. I am informed by senior counsel for the plaintiff that such an award might be expected in the courts of NSW in similar circumstances. This surprises me, having regard to the ceiling on general damages applicable by statute in that state, which I assumed had been imposed in order to effect some general reduction in that component of damages. Senior counsel for the plaintiff informs me that the effect has been otherwise. I feel myself bound to award general damages which accord generally with other awards in this Territory, in particular awards which have had the imprimatur of the Court of Appeal.

I accept that the plaintiff will have back pain of fluctuating severity for the rest of his life, and that he will probably require medication for pain relief from time to time. I accept that there is a possibility that he will ultimately deteriorate and come to surgery, although I take into account the fact that he had not seen a doctor for a year or so before trial. I recognise that he enjoyed many physical leisure activities before his injury and that these are now permanently closed to him.

He must be compensated for the physical and other effects of his erectile dysfunction, which he blames in part for the failure of his marriage. His heavy drinking for a period of time probably also played a part in that failure, but this should also be seen as a consequence of his injury. Taking account of all these things, one cannot argue that the plaintiff’s life is, and will always be, very different and much less satisfactory than if it had not been for his injury.

For general damages for pain and suffering and loss of enjoyment of life I award $140,000.00.

I apportion that sum equally between past and future. The plaintiff is now 38, and there is no evidence that his life expectancy has been reduced by his injury. He has already put up with more than eleven years of pain.

The past proportion of general damages carries interest at the rate applicable under the general law of 4% per annum. I apportion the amount over the period from the injury to the date of judgment, weighting it more heavily towards the period of some two years after the injury. For interest on past general damages I allow $18,000.00.

Treatment expenses were agreed to the date of trial at $24,408.79, almost all paid by the second third party as workers’ compensation insurer. The plaintiff will have incurred some further expense since trial for medication. I allow $25,000.00 for past out-of-pocket expenses. There is no claim for interest on that component.

For the future, I take account of the fact that the plaintiff will have expenditure for chemist medication for the indefinite future and that he will probably need to see doctors from time to time. He may come to surgery but probably not for many years. It is possible that he will choose to have psychological or psychiatric counselling once he has recovered damages and can afford it, but I am far from persuaded that this is particularly likely. It is more likely that he will choose, if his pain is troubling him enough, to have some further treatment by way of physiotherapy, chiropractic or massage. Notwithstanding the approach urged on me by senior counsel for the plaintiff, I am not persuaded that an allowance for future treatment expenses can be arrived at in a mathematical way. It seems to me preferable to award a rounded figure to take account of all of those possibilities and probabilities. For future out-of-pocket expenses I allow $15,000.00.

The Fox v Wood (tax on workers’ compensation) figure is agreed at $7,185.60.

Senior counsel for the plaintiff has handed up a calculation of loss of earnings to the date of trial, with which senior counsel for the second third party, who addressed on damages, did not really take issue. The figure arrived at to the date of trial, which includes an allowance for loss of superannuation benefits, was $108,637.10. There will have been further losses since trial, and I allow for past loss of earnings $115,000.00.

Some of that loss has been covered by workers’ compensation and to that extent does not attract interest. For the past losses not compensated for, senior counsel for the plaintiff seeks interest of $10,000.00, about which there is no real argument. I allow $10,000.00 for interest on past economic loss.

For future loss of earning capacity, senior counsel for the plaintiff claims some $350,000.00. That seems to me an ambit claim which cannot be justified. The plaintiff is capable of working and earning income. At the time of trial he had recently started a new business. That business may turn out to be a highly profitable one but it may not. I can reasonably take judicial notice of the fact that many, perhaps most, fledgling businesses have failed within one or two years. But the plaintiff chose to start that business at a time when he concedes that he was capable of driving a concrete truck, or a courier vehicle.

Heavier employment of the kind of he was engaged in when injured is permanently closed to him, and this greatly reduces his options in the labour market. That market has a tendency to be cyclical, with periods of full employment and periods of reasonably high unemployment. In periods when unemployment is high, the plaintiff will probably not be the most attractive applicant for such work as is available within his experience and skills. He is now 38. His work was not so heavy that I would be satisfied that he probably would have been unable to continue with it beyond age 60. I think it more likely that he would have worked to about age 65 if not for the injury.

Again the calculation of a figure to compensate him for his loss of earning capacity, to the extent that it is likely to be reflected in actual financial loss, is not one for a mathematical approach. The 3% multiplier for a man age 38 to age 65 is 938. Having regard to the nature of the plaintiff’s work I am minded to apply a reducing factor of 20% for vicissitudes rather than the conventional 15%. I adopt a figure of $200.00 per week as representing the approximate difference between what the plaintiff might have been capable of earning if it had not been for the injury, and what he is capable of earning in his present condition. For loss of earning capacity for the future I allow $150,000.00

Senior counsel for the plaintiff mounts a substantial claim for the commercial value of domestic services which the plaintiff is no longer capable of performing. Although generally referred to within the legal profession and the insurance industry as the Griffiths v Kerkemeyer component, strictly this claim in the present case does not come within that principle because it is not a claim for the commercial cost of care or services which the plaintiff needs someone else to perform for or upon him. It is a claim for the commercial cost of tasks the plaintiff used to undertake but is no longer able to undertake, and which now need to be done by someone else instead. Although damages are not available in respect of such services or tasks under the general law (CSR Limited v Eddy (2005) 226 CLR 1), such damages are recoverable by virtue of s 100 of the Civil Law (Wrongs) Act 2002.

There is no real issue between counsel as to the amount claimed for past assistance. The rate claimed is $25.00 per hour, which is accepted by counsel for all parties and seems to me reasonable. The claim is for four hours per week for the first sixty weeks ($6,000.00); seven hours per week for the next 212 weeks ($37,100); three hours per week for the next 100 weeks ($7,500.00); and seven hours per week for the balance of the period since 11 November 2009 ($38,850.00). The total of these amounts is $89,450.00, which I award.

That component of damages attracts interest at prescribed commercial rates. The appropriate interest rate, spread over the whole period, is 7% per annum, and I allow $30,000.00 for interest.

The 3% multipliers for a man aged 38 are 824 to age 60, 938 to age 65 and 1,192 for life. It seems to me reasonable to adopt a multiplier for the future of 900, bearing in mind that regardless of injury, people become less capable of carrying tasks out as they get older, and many reach an age at which they can do little for themselves. It is accordingly not appropriate to use the life multiplier. I adopt the hourly rate of $25.00 and a reduction of 20% for vicissitudes to arrive at an award of $126,000.00 for future domestic assistance.

The individual components of the award of damage are as follows:

General damages $140,000.00

- interest on past proportion $18,000.00

Out-of-pocket expenses – past $25,000.00

- future $15,000.00

Fox v Wood $7,185.60

Loss of earnings – past (including superannuation) $115,000.00

- interest on past loss $10,000.00

Loss of earning capacity – future $150,000.00

Domestic assistance – past $89,450.00

- interest $30,000.00

- future $126,000.00

___________
$725,635.60

That total seems to me to represent a fair reflection of the effect of the defendant’s negligence upon the plaintiff. There will be judgment for the plaintiff against the defendant for that amount.

The third party claims

The defendant claims against both its NSW insurer and its ACT insurer.

Insurance in the ACT against claims by employees for personal injury was governed at the date of the plaintiff’s injury by the Workers Compensation Act 1951. That Act has been amended on numerous occasions, both before and since the injury. At the time of the injury the Act required employers to hold a compulsory insurance policy issued by an approved insurer. A compulsory insurance policy was defined in s 144 of the Act to mean an insurance policy for an unlimited amount for any liability of the employer under the Act, or independently of the Act, for an injury to each Territory worker employed by the employer, and that complied with the Act. There is no issue that the second third party was an approved insurer and that there was in force at the time a compulsory insurance policy which met the requirements of s 144. The policy provided that the insurer would indemnify the employer against all sums for which the employer was liable to pay, both by way of compensation under the Act, and any other amount in respect of the employer’s liability independently of the Act, for any injury to any person who was or was deemed by the Act to be a worker of the employer. Worker is defined in s 8 of the Act, within chapter 3 which contains a number of provisions clarifying who is and who is not a worker for the purposes of the Act. There is no doubt that a person in the position of the plaintiff, who worked under a contract of service with the defendant as his employer, was a worker as defined.

Section 33 limits the liability of an employer to pay workers’ compensation to workers of the Territory. The section goes on to provide:

33 (2)   For this Act a worker is a worker of whichever Territory or State is –
(a)       the Territory or State where the worker usually carries out                the work of the employment concerned; or
(b)       if no Territory or State, or no single Territory or State, is   identified by paragraph (a) – the Territory or State where the           worker’s base for the purposes of that employment is   located; or
(c)       If no Territory or State, or no single Territory or State is   identified by paragraph (a) or (b) – the Territory or State   where the worker was hired or otherwise taken into that   employment.

In the present case, the plaintiff usually carried out his work in both NSW and the ACT, often working in both on the same day. Thus paragraph (a) does not identify a single Territory or State.

The location of his base for the purposes of his employment is a matter in issue on the facts. I am satisfied that his base was at Mitchell in the ACT. I accept his evidence that generally he reported there each morning to be allocated his tasks for the day. It is clear on his evidence that he regarded Mitchell as his base, and that he did not regard Yass as his base. Mitchell was the head office of the company, where its administration was located. Far more stock was kept at Mitchell than at Yass. The plaintiff did not give evidence that he was subject to direction by the Yass manager, Mr Shea, and was not subject to direction by management or senior staff at Mitchell.

If I am wrong about that, I am unquestionably satisfied that Yass was not his base. This would mean that no single Territory or State was identified by paragraph (b) either. In that case paragraph (c) would come into play, and the plaintiff would be found to be a worker of the Territory or State where he was hired or taken into employment. I am satisfied upon the evidence that he was engaged at Mitchell and not at Yass. I prefer his evidence to that of Mr Agnew and Mr Shea in that regard. Even Mr Shea acknowledged that the ultimate decision to employ was that of Mr Agnew. I am satisfied that the plaintiff did not enter the employment of the company prior to his arrival at Mitchell on the day of his interview with Mr Shea, and that he did not enter that employment until he had been interviewed and accepted by Mr Agnew. This happened in the Australian Capital Territory. On the test in paragraph (c), the plaintiff was a worker of the Territory.

Consistently with this, he received payments of workers’ compensation from the ACT insurer (the second third party). I do not regard that as determinative. I am not satisfied that any relevant decision-maker on behalf of the defendant or the second third party turned his or her mind to the issue which has arisen for determination in the third party proceedings. None of the parties has sought to persuade me that the second third party is estopped by reason of the payments of workers’ compensation. The possibility remained open until my decision that the plaintiff was not a worker of the Territory, and that the insurer made those payments under the misapprehension that he was. It is unnecessary for me to consider whether such a misapprehension would have amounted to a mistake of fact, or a mistake of law, or whether that distinction might have been of any significance.

In any event, s 33 limits the liability of an employer only in relation to payments of workers’ compensation. It does not purport to limit an employer’s liability to pay damages under the general law. I have not been taken to, nor have I been able to find, any provision of the Act then in force which would so limit the liability of an employer. If this had been the intention of the legislature, one would expect it to have been spelt out in such terms as to establish a statutory defence to such a common law claim.

The policy limits the insurer’s liability to claims against the employer by persons who are or are deemed by the Act to be a worker of the employer. These words bring into play chapter 3 of the Act, but not s 33 which is in chapter 4. The policy does not in terms restrict the liability of the insurer to claims by workers of the Territory.

I am satisfied in the present case that the plaintiff was a worker of the Territory by reason of his base and, if I am wrong about that, the place where he was hired. However, it seems to me that the ACT insurer would be liable to indemnify the defendant under the policy even if the plaintiff had not been a worker of the Territory for the purposes of s 33.

The defendant is accordingly entitled to succeed in the third party claim against the ACT insurer (the second third party).

This leaves open the claim by the defendant for indemnity from the first third party (the NSW insurer). There may have been an assumption by counsel during the hearing that the outcome would be a finding that one insurer was liable and the other was not, but it does not seem to me that my finding against the ACT insurer necessarily means that the claim against the NSW insurer must fail. It is a matter of examining the NSW policy and, where applicable, legislation, before arriving at a conclusion about whether the NSW policy responds to the claim.

The policy under the NSW Act is to be found in Form 4 under the Workers Compensation Act 1987 of that State. The policy provides that the insurer will indemnify the employer against, among other things, any amount that the employer becomes liable to pay independently of the Act for any injury to a worker of the employer. That expression (“independently of the Act”) means, for present purposes, damages under the general law, whether or not in a NSW court. There is no question that it is applicable to a judgment against the employer in the present action.

I was taken by counsel to a number of provisions of the Workers Compensation Act 1987 (NSW) but not to any provisions of that Act which would rule out liability to employees of the insured who were not workers of the State.

Counsel for the NSW insurer (the first third party) took me to the decisions of Fox J in this court in Busico v Century Insurance Co Ltd (1969) 14 FLR 189, and of the NSW Court of Appeal in Dillingham Engineering Pty Ltd v National Employers’ Mutual General Insurance Association Ltd (1971) 1 NSWLR 578. However, both of those decisions, it seems to me, turned on the words of the legislation in force at the time the causes of action arose. That wording was quite different to the wording of the legislation and of the policy in the present case and the decisions are accordingly of little assistance.

S 13 of the Workers Compensation Act 1987 (NSW) deals with injuries received outside NSW, but only to the entitlement of the employee to workers’ compensation, not to damages under the general law.

I am not persuaded that there is anything in the NSW legislation or in the decided cases which would deprive the defendant of its entitlement to be indemnified in respect of the claim by this plaintiff, who worked for much of his time in NSW, under the NSW policy issued by the first third party.

The defendant is accordingly entitled to be indemnified by the first third party under the NSW policy.

This should accordingly be seen as an illustration of the operation of the principle of dual insurance. The defendant is covered by two policies against the same risk, and is entitled to be indemnified under both policies. The insurers are liable to contribute equally to the loss suffered by their insured.

Conclusion

The plaintiff is entitled to judgment against the defendant for $725,635.60. The defendant is entitled to judgment against each of the third parties for that amount. The third parties should contribute equally. They have not formally sought contribution from each other but this should not stand in the way of the making of orders for contribution if sought by either third party. Assuming that both insurers are solvent one would expect that this will be unnecessary.

I propose to order that the defendant pay the plaintiff’s costs, but that that order be stayed for 21 days in case there are circumstances relevant to costs of which I am unaware. Either the plaintiff or the defendant may give notice by email to the court with a copy to the other parties of intention to seek a different order as to costs within 21 days. If the court receives notice of intention to make such an application within that period, the stay will be extended until further order.

The defendant and the third parties will have liberty to apply as to the costs of the third party proceedings.
I certify that the preceding one hundred and seventy two (172) numbered paragraphs are a true copy of the Reasons for Judgment herein of his Honour, Master Harper.
Associate:
Date: 17 February 2014

Counsel for the plaintiff:  Mr H J Marshall SC and Dr S C Thornton
Solicitors for the plaintiff:  Capital Lawyers
Counsel for the defendant:  Mr W L Sharwood
Solicitors for the defendant:  Meyer Vandenberg
Counsel for the first third party:  Mr P A Rickard
Solicitors for the first third party:                  Goldbergs by their agents Minter Ellison
Counsel for the second third party:               Mr M J Cranitch SC and Mr A R Muller
Solicitors for the second third party:             Moray & Agnew
Date of hearing:  2, 3, 4 October 2012
Date of judgment:  17 February 2014