Mclaughlin v Employers Mutual NSW Limited

[2021] NSWSC 198

Supreme Court

New South Wales

Medium Neutral Citation:

Mclaughlin v Employers Mutual NSW Limited [2021] NSWSC 198

Hearing dates:

02 March 2021

Date of orders:

02 March 2021

Decision date:

02 March 2021

Jurisdiction:

Common Law

Before:

Cavanagh J

Decision:

1. Judgment for the defendant.

2. The plaintiff is to pay the defendant’s costs.

Catchwords:

NEGLIGENCE – duty of care – particular relationships – duty owed by workers compensation insurer to injured worker – no duty owed - workers compensation - proper forum

Legislation Cited:

Limitation Act 1969 (NSW)

Workers Compensation Act 1987 (NSW)

Workplace Injury Management and Workers Compensation Act 1998 (NSW)

Cases Cited:

Mclaughlin v Burrows & Ors t/as Kells The Lawyers [2020] NSWSC 1802

Category:

Principal judgment

Parties:

Scot George Mclaughlin (Plaintiff)
Employers Mutual NSW Limited (Defendant)

Representation:

Counsel:
P Stockley (Defendant)

Solicitors:
Plaintiff (Self-represented)
Lee Legal Group (Defendant)

File Number(s):

2020/79606

Publication restriction:

None

REVISED EX TEMPORE Judgment

1. By way of an amended statement of claim filed on 20 August 2020, the plaintiff, Scot George McLaughlin, brings proceedings against the defendant, Employers Mutual NSW Limited, seeking compensation in respect of injuries and losses he has sustained since approximately 1999. Mr McLaughlin appears for himself in the proceedings. Paul Stockley of counsel appears for the defendant.

2. The matter was listed before me for two days commencing 2 March 2021. Further, there was a motion filed by the defendant listed for hearing at the same time, pursuant to which the defendant sought to have the proceedings dismissed on the basis that there was no cause of action disclosed in the statement of claim or on a pleadings point.

3. Although I suggested that the hearing should commence with consideration of that motion, it became apparent that the issues involved on the hearing and on the motion were somewhat similar and thus the evidence and submissions on the motion and the hearing were considered at the same time. In the end, after some discussion with Mr Stockley, the defendant withdrew its motion. As such, the matter proceeded to a full hearing and a final determination of all of the issues raised on the pleadings.

4. The statement of claim filed on 20 August 2020 was the third version of the statement of claim filed by the plaintiff. The parties prepared a joint court book and the whole of the joint court book was admitted into evidence.

5. Although Mr Stockley raised issues as to the admissibility and relevance of some of the documents, I indicated I would give such documents such weight as I thought fit in all the circumstances. In addition to the documents contained in the court book, the plaintiff gave oral evidence, particularly relating to the difficulties that he has experienced over the past 20 years in relation to his health, the very significant issues that have confronted him, and his considerable determination in overcoming the problems that he has had to deal with.

6. His evidence contained a number of references to what other people had said to him, including what doctors might have said to him about his medical conditions. Again, I will treat such statements appropriately, having regard the weight that I might give such hearsay statements.

The plaintiff’s case

7. As set out in his amended statement of claim, the case against the defendant is essentially that it acted in breach of a duty of care which the plaintiff submits was owed to him, and further, that it had unfairly applied s 52A of the Workers Compensation Act 1987 (NSW) (WCA) (see s 2 of the amended statement of claim) to the detriment of the plaintiff.

8. Although the basis of the defendant’s motion was that the statement of claim did not disclose a proper cause of action (and there may have been some merit in that suggestion), the hearing was conducted on the basis that the plaintiff was allowed to articulate the case that he wished to pursue against the defendant orally and the defendant was able to respond to that case.

9. The background to the matter is that the plaintiff unfortunately sustained injuries on or around 16 March 1999 in the course of his employment with High Sierra Windows Pty Limited. He was apparently required to ascend a ladder and whilst he was doing this, the ladder moved, causing him to fall to the ground. The plaintiff then suffered a further injury during the course of his employment on 18 June 1999.

10. As a result of the accidents, he sustained an injury to his cervical spine, left shoulder and psychological injuries. He also maintains that he suffered an injury to his back and that as a result of the injury sustained in these accidents, he has developed epilepsy.

11. He pursued a claim for workers compensation. The relationship between the plaintiff and the defendant is that the defendant was the workers compensation insurer of his employer, High Sierra Windows. The defendant made payments to the plaintiff in accordance with its obligations under the WCA during the period 1999 to 2003, albeit there was a dispute between the plaintiff and the defendant as to the amount of payments that should have been made and whether the plaintiff was fit for work. The plaintiff says that during that period he was forced to attend rehabilitation services at the request of the defendant and wrongly forced to return to some form of work on the recommendation of the rehabilitation provider.

12. On 13 December 2002 the dispute between the plaintiff and his employer and the defendant first came before Commissioner Hogg in a hearing in the Compensation Court of New South Wales. In his judgment dated 5 September 2003, Commissioner Hogg determined that the plaintiff was fit for some work but that he was not seeking suitable employment in accordance with his obligations having regard to s 52A of the WCA.

13. It is not necessary that I consider s 52A further, except to say that it is clear from the section that weekly payments of compensation in respect of partial incapacity for work were not payable for any period beyond the first 104 weeks of partial incapacity if one or more of the reasons set out in s 52A apply. One of the reasons is that the worker is not suitably employed and not seeking suitable employment.

14. As I understand the position, the findings of Commissioner Hogg led to a discontinuance of workers compensation payments to the plaintiff. As Commissioner Hogg said in para 84 of his decision, he was of the view that the plaintiff had not been seeking suitable employment and had made no effort whatsoever to seek work within his capabilities. Plainly, the plaintiff disagrees with those findings as he maintains that he has been severely disabled since his accidents, except for some limited periods when he tried to go back to work.

15. I should emphasise that nothing in this judgment should be interpreted as being any finding as the level or extent of the plaintiff’s disability. The plaintiff presented as a person who suffered from a real disability and presented in a genuine manner. However, it is not my function in these proceedings to comment further on the decision of Commissioner Hogg and whether the plaintiff should have been doing work back in 2003 or 2005, or at some other time.

16. As even the plaintiff would agree, this is not an appeal from the decision of Commissioner Hogg. In any event, continuing with the background narrative, some time after the decision of Commissioner Hogg, the plaintiff applied for the defendant to review that decision and reinstate his payment of benefits. The defendant declined to do so. However, it did pay for a further short period of benefits and medical expenses during the period 2004 to 2005.

17. At some stage prior to December 2008, the plaintiff consulted solicitors, Kells Lawyers, regarding pursuing a work injury damages claim.

18. By letter dated 9 December 2008, those solicitors wrote to the defendant giving notice of a claim for work injury damages. Pre-filing statements were filed. There was then a settlement of the claim, which is reflected in a deed dated 2 November 2009. The defendant paid to the plaintiff (on behalf of his employer) the sum of $220,000 clear of payments and inclusive of costs. I understand from the plaintiff that he did not receive all of that amount, but that is the amount the defendant paid to his solicitors.

19. The plaintiff accepts that such a settlement would bring an end to his right to damages or compensation in respect of the neck injury sustained in the accidents, but the plaintiff says that he has also suffered a back injury and that he is pursuing a separate claim in respect of that back injury. He says that the defendant has wrongfully declined to pay him any benefits or pay for the cost of a back operation which he requires.

20. Further, the plaintiff says that, although he has been suffering from epilepsy since about 2000, which he says is related to the accidents, his condition was first diagnosed in 2016 and he has been pursuing a claim against the defendant in respect of the epilepsy but, again, the defendant has refused to acknowledge or accept the claim.

21. The plaintiff says that although he had back problems at the time of the original settlement in 2009, he did not wish to pursue any claim in respect of his back problems and specifically did not wish to undergo an operation which had been recommended to him at that time because the medical advice was that he should defer that as long as possible.

22. Having deferred the operation as long as possible, he contacted his solicitors in 2016 saying that he now wished to have the operation and requesting that a claim be made with the defendant for the cost of the operation. To his surprise, his lawyer told him that he had settled his rights in respect of not only his neck injury but also his back injury and that he could not pursue a new claim in respect of the back injury.

23. Having received this advice, he says that he rang the defendant directly about the claim and again, the defendant declined to make any payment, despite his request to do so.

24. In support of his assertion that he is in fact entitled to bring a subsequent claim for his back injury, he says he rang an organisation called Law Access and he spoke to them over the phone and someone from Law Access told him that he had a right to make a claim in respect of the back injury.

25. He also says that he has taken the issue up with relevant government agencies, whether that be SIRA or WIRO. He has also spoken to the police about the conduct of his former solicitors.

26. Again, importantly, he has already issued proceedings against his solicitors, presumably on the basis of what he maintains was incorrect advice given to him. Those proceedings were the subject of a judgment by Bellew J in this Court in McLaughlin v Burrows & Ors t/as Kells The Lawyers [2020] NSWSC 1802. His Honour dismissed the proceedings for the reasons set out in the judgment.

27. The plaintiff is not a lawyer and it seems that his attempts to engage assistance with his case have not been successful.

28. Of course, I must have regard to the fact that he does not have legal training in assessing the nature of his case and his pleadings. Mr Stockley approached the matter similarly on the basis that the plaintiff did not have legal training, and indeed identified the issues and made submissions on a basis that the plaintiff would hopefully understand, for which the court is grateful.

29. Having said that, Mr Stockley maintains, consistent with his instructions, the plaintiff is not entitled to succeed in these proceedings and that the statement of claim discloses no arguable cause of action. It is difficult to discern from the amended statement of claim the precise nature of the claim and what losses might have been sustained, but it is clear that the plaintiff is pursuing a claim in negligence against the defendant. Indeed, the opening words to the statement of claim are “Failure of Duty of Care”, and the plaintiff’s oral argument was very much focused on the wrongful failure of the defendant to comply with its duty of care.

30. In order to move the matter forward, I asked the plaintiff to identify the real nature of his case and what he really sought from the defendant. He identified six, what I will call, failures of the defendant which I will now list being:

1. During the period 1999 to 2002 the rehabilitation provider forced him to undertake rehabilitation and work when he was not fit to do so and the defendant supported that conduct;

2. During the period 2002 to 2009 the defendant failed to organise rehabilitation for the consequences of his neck injury;

3. From 2009 on the defendant failed in its duty of care to him in that, again, it did not organise any rehabilitation for him, whether in respect of his back or neck injury;

4. The defendant unfairly applied s 52A of the WCA in the sense that it should have reinstated his income payments despite the finding of Commissioner Hogg;

5. The defendant failed to accept the diagnosis of epilepsy and accept that it was liable to make payments to him. Instead, it continued to deny the claim; and

6. There was an underpayment of workers compensation from 1999 to 2003. The plaintiff says that his employer was underpaying him, that it should have been paying him a lot more money and this has resulted in an underpayment from the workers compensation insurer, being the defendant.

31. The case proceeded on the basis that they are the allegations made by the plaintiff and that the plaintiff is alleging that the defendant owed a duty of care to him and that in failing to do the things that the plaintiff maintained, the defendant was acting in breach of duty of care. That is the substance of the statement of claim, albeit it might be difficult to discern that from the document.

32. The plaintiff spent some time taking me through the Court book. I have had regard to all of the documents in the Court book, including all the medical statements, the medical certificates, the x-ray reports, the reports of Dr Robert McGrath, Neurologist, the workers compensation medical certificates, the claim and all of those materials relating to the work injury damages claim that he pursued in 2002.

The defendant’s position

33. The defendant’s position is as follows:

1. Firstly, the settlement of the work injury damages claim in 2009 brought to an end the plaintiff’s right to further workers compensation having regard to s 151A of the WCA and the Deed of Release.

2. Secondly, there is no nexus between the plaintiff’s injury to his neck and the development of epilepsy. Whilst Dr McGrath may have ultimately agreed that the plaintiff was suffering from epilepsy, the evidence does not establish any causal relationship between the epilepsy and the original injury.

3. Thirdly, as set out in s 105 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) (WIM Act), it is the Workers Compensation Commission or now the Personal Injury Commission which has exclusive jurisdiction to deal with disputes relating to compensation payments under the WCA.

4. Fourthly, the defendant submits that the plaintiff’s submission on the effect of s 52A is misplaced. In any event, the defendant points out that some payments were reintroduced for a period, which I understand to be in 2004 or 2005.

5. Fifthly, the plaintiff has not established that the defendant owed any duty of care to him and further has not established any breach of duty of care.

Consideration

34. It is clear that the plaintiff feels aggrieved as to what has happened to him over the past 20 years and feels let down by the system. It is clear that he feels that the epilepsy which he has developed is related to the accident in 1999 and, further, that the work injury damages settlement in 2009 was only in respect of his neck injury. Thus, he should not be precluded from pursuing any further claims, particularly in respect of a back injury and epilepsy.

35. However, whatever be his feelings or his grievances, I must deal with his claim for compensation or damages having regard to both his pleadings and the way he outlined his case in this Court.

36. In my view, there are some fundamental problems for the plaintiff in pursuing the claim that he is pursuing in this Court, both as pleaded and as articulated during the hearing. Those problems include the following.

37. Firstly, neither the plaintiff nor the defendant have been able to identify any case or authority which supports the proposition that a workers compensation insurer in the position of the defendant owes a duty of care to a person employed by one of an insurer’s insureds and seeking workers compensation. Indeed, whilst there has been what I will describe as the occasional judgment in which this issue has been considered, I am not aware of any case where there has been a finding that, in the circumstances of the relationship between the defendant and the plaintiff in this matter, the defendant owed a duty of care to the plaintiff.

38. I am not considering whether the defendant owed a duty to act with good faith towards the plaintiff or whether it owed some statutory obligation as set out in either the WCA or the WIM Act. The plaintiff’s case as pleaded and as put orally is that the defendant failed to comply with its duty of care. A duty of care is not owed in a vacuum. Whether a duty of care is owed must depend upon the relationship between the parties. There are some common relationships which give rise to duties of care, as are well-known, such as employers and employees, occupiers and entrants, schools and teachers.

39. The defendant was not the employer of the plaintiff. The employer of the plaintiff was High Sierra Windows. The defendant was and is an insurer licensed to provide workers compensation benefits to and on behalf of an employer. The defendant has statutory obligations and obligations to make payments, make a determination and deal with claims as set out in the legislation.

40. In my view, the relationship between the plaintiff and the defendant did not impose on the defendant a duty of care independently of its statutory obligations.

41. Thus, the first problem with the plaintiff’s claim is that it is dependent upon acceptance that the defendant owed a duty of care to the plaintiff. In my view, it did not.

42. The second problem with the plaintiff’s claim in this Court is that s 105 of the WIM Act states that the Commission has exclusive jurisdiction to examine, hear and determine all matters arising under the WCA (see s 105(1)).

43. This means that in any dispute as to the entitlement of a worker such as the plaintiff to payments from a workers compensation insurer or employer, the proceedings should be commenced in the Commission (now called the Personal Injury Commission) and not in this Court.

44. Although the plaintiff says that he is suing the defendant in negligence and that he wants compensation, including payment of medical expenses, benefits and loss of income, in reality his main complaint is that the defendant has failed to make payments to him for a lengthy period and, in particular, has failed to pay for his medical treatment, including a back operation, and failed to properly respond to his claim in respect of his epilepsy.

45. These are matters which give rise to a dispute between the plaintiff as a worker, his employer and the defendant as the insurer, as to an entitlement to statutory benefits. The Commission has exclusive jurisdiction to determine that dispute. As such, this is not the right place for the plaintiff to be suing the insurer seeking payment of benefits. Section 105 is not an answer to the claim in negligence but, having regard to the way the case was presented, it does seem to me that the plaintiff’s real complaint is that the defendant has not responded to his claim for further payments.

46. The third problem with the plaintiff’s claim is that even assuming that the insurer owed a duty of care as suggested, the plaintiff’s claims are more a description of complaints about conduct than an articulation of a failure to act with care. In any negligence action it is necessary to articulate not only why a party owes a duty of care but the scope of that duty of care and how the conduct might be said to be a breach of the duty of care.

34. By way of example, in respect of each of the first three parts of the plaintiff’s claim relating to the rehabilitation, in order to establish a breach of duty of care, if one was owed in respect of the conduct of CRS as the rehabilitation provider, the plaintiff would need to establish more than merely that he did not consider himself fit to return to work. He would need to establish that CRS failed to properly assess and consider his medical status, and that in some way, the defendant was responsible for that failure.

35. Similarly, in respect of the alleged failure to organise rehabilitation from 2002 the plaintiff would need to establish that the defendant was on notice that he remained incapacitated as he maintains and that he required rehabilitation and that the defendant was on notice that it should have been providing rehabilitation. The difficulty is that Commissioner Hogg is not the agent of the defendant. He is an independent person who made findings about the nature and extent of the plaintiff’s disability in 2003.

36. There is no basis for any allegation of negligence in respect of the defendant’s response to the plaintiff’s disability in the years subsequent to the finding of Commissioner Hogg.

37. Further, it is difficult to understand how the defendant could be negligent in failing to accept the plaintiff’s claim for payment for the back operation in circumstances in which, on the plaintiff’s own case, he says that his own solicitors told him that he had settled his rights to payment for the back claim back in 2009.

38. No doubt the defendant agrees with that position. It is not for this Court to determine whether that is right or wrong. I do not need to do so. If there is a dispute as to an entitlement to payments of compensation the Personal Injury Commission is the place for that to be determined.

39. There is no evidence which would support a finding of negligence even if a duty was owed. As I have already indicated, he has already pursued proceedings against his lawyers.

40. The final matter raised by the plaintiff is that the defendant failed to make appropriate payments of compensation back in 1999. As I understand the submission this occurred because his employer had been underpaying him and this resulted in a lesser payment of workers compensation than should have been made. Again, I do not know whether his employer was underpaying him but, if I accept what the plaintiff says, the reason that he was underpaid by the defendant is because the employer had not been paying him the correct salary. Again, that does not give rise to a cause of action by the plaintiff against the defendant.

41. Finally, and although it is not necessary to make any determination on this issue, the conduct said to give rise to underpayment happened 20 years ago. Section 14 of the Limitation Act 1969 (NSW) provides for a limitation period of 6 years. Even if other provisions of the Act such as s 50C apply, it is difficult to anticipate the basis on which those provisions might be overcome.

42. I should say that the plaintiff gave evidence and developed an argument that he was suffering from a mental illness, including depression and anxiety, and he described epilepsy as a mental illness. Even if that may be so (and I am not doubting that) if it became necessary to determine the matter on a limitation point, it may be that there would be some further difficulties for the plaintiff. I do not consider it necessary to make any further comment on the limitation point.

43. In the end the plaintiff must fail. He has not established any cause of action against the defendant. I do not accept that the defendant was negligent as maintained. I do not accept that the defendant owed a duty of care to the plaintiff. To the extent that his claim is really a claim for payments dressed up as a claim for negligence which, to a large degree, it appears to be, then this is not the right forum. If he wishes to pursue a claim with the Personal Injury Commission, that is a matter for him. In the circumstances, the plaintiff fails and there shall be a judgment for the defendant.

44. It is the normal rule in these sorts of cases that costs follow the event. Whilst the plaintiff indicates that he does not wish to pay costs - and whilst I understand that he is self-represented - I am not aware of any circumstances which would lead to a variation of the normal rule here. I order the plaintiff to pay the defendant’s costs.

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Decision last updated: 09 March 2021