Neil John Espley by his tutor Anita Espley v Strathaven Holdings Pty Ltd ATF Palace Hotel Unit Trust t/as the Palace Hotel Sydney Since 1877

[2019] NSWSC 800

Supreme Court

New South Wales

Medium Neutral Citation:	Neil John Espley by his tutor Anita Espley v Strathaven Holdings Pty Ltd ATF Palace Hotel Unit Trust t/as The Palace Hotel Sydney Since 1877 [2019] NSWSC 800
Hearing dates:	19 June 2019
Decision date:	28 June 2019
Jurisdiction:	Common Law
Before:	Button J
Decision:	Settlement approved
Catchwords:	PRACTICE AND PROCEDURE – application for approval of settlement of personal injury proceedings commenced on behalf of person under legal incapacity – whether proposed settlement is in the interests of the plaintiff
Legislation Cited:	Civil Liability Act 2002 (NSW)
Category:	Principal judgment
Parties:	Neil John Espley by his tutor Anita Espley (Plaintiff) Strathaven Holdings Pty Ltd ATF Palace Hotel Unit Trust t/as The Palace Hotel Sydney Since 1877 (Defendant)
Representation:	Counsel: E Romaniuk SC (Plaintiff) C Kakakios (Defendant)   Solicitors: LHD Lawyers (Plaintiff) Clyde & Co (Defendant)
File Number(s):	2016/232569

Judgment

Background

1. This application for approval of a settlement in personal injury proceedings came before me recently in the Duty list. The evidence placed before me without objection establishes the following.

2. On 2 October 2014, Mr Neil Espley (the plaintiff, who prosecutes the matter through a tutor for reasons that will shortly become apparent) intended to enjoy a weekend with male friends in Sydney, he residing on the Sunshine Coast.

3. On that Thursday evening, he was enjoying drinks in the Palace Hotel at Haymarket, which is within a historic building and was established in 1877. He sought to descend from the ground floor bar to the bathroom in the basement. Tragically, whilst using the stairs, he slipped and fell.

4. It was soon discovered that he had suffered a life-threatening head injury, and he was promptly taken by ambulance to St Vincent’s Hospital Darlinghurst.

5. Thereafter, there were complications, and he has endured more than one operation to his skull and brain. He has been left with a permanent cognitive disability, and, quite apart from its impact upon him, in the words of one medical expert the whole ordeal has been a “colossal burden” on his loving wife.

6. As I understand it, there is no dispute between the parties that the fall occasioned grave, permanent deficits to the plaintiff. Having said that, entirely bona fide, different experts have taken different views about the severity of his injury, its long-term prognosis, and the degree of care or supervision that the plaintiff will require for the rest of his life.

Aspects of litigation

7. The more substantive dispute between the parties, however, is about liability.

8. On the one hand, evidence placed before me suggests that the stairs to the basement were (as one might expect in a historic hotel) not new and hardly pristine. There is also some evidence to suggest that they were poorly lit, that their edges were insufficiently marked, and that there may have been some chipping to those edges as well. All of that, of course, is supportive of an argument that the defendant is liable to the plaintiff in negligence, because the state of the stairway “caused” his injuries.

9. On the other hand, a reading of blood alcohol concentration (BAC) was taken from the plaintiff shortly after he arrived at the hospital on the evening in question. It was the remarkably high reading of .32. Although, as senior counsel for the plaintiff explained, there are ways in which the accuracy of such a reading may be able to be impugned, nevertheless, that objective reading – combined with other evidence that the plaintiff and his friends had been drinking steadily for an extended period – argues against success of the claim against the defendant in the following ways.

10. First, without me engaging in a detailed analysis of the provisions about causation to be found in the Civil Liability Act 2002 (NSW) (the CLA), an argument is obviously open to the defendant that it was not the state of its stairs that caused the injury; rather, it was the level of intoxication of the plaintiff.

11. Secondly, and separately, even if causation were able to be established, that level of intoxication could nevertheless very substantially reduce if not obliterate the claim, by way of the doctrine of contributory negligence.

12. Thirdly, and separately again, s 50 of the CLA could disentitled the seemingly intoxicated plaintiff to relief; again, entirely.

13. An entirely separate forensic problem that confronts the plaintiff, bearing as he does the onus of proof on the balance of probabilities, is that his injury has left him with no memory whatsoever of how he fell; there were no witnesses to the fall; and there is no relevant CCTV available.

14. The matter has been the subject of a degree of pre-trial preparation, up until the time that it was resolved between the parties by way of mediation, subject to approval of this Court.

15. Senior counsel for the plaintiff (who, not immodestly, told me from the Bar table that he has a long-standing expertise in matters of this kind) placed a confidential advice before me. It delved more deeply into the forensic problems that I have sketched above; for obvious reasons, I shall not do so.

16. He also explained that the operation of the three factors that I have set out above could render this an “all or nothing” case, in that one might expect the plaintiff, at the end of a fully contested trial, either to succeed entirely or to fail entirely. And if the latter were the outcome, one would expect of course that he would bear an enormous burden of costs. It is for those reasons, senior counsel explained, that the proposed settlement is well below the maximal claim that could be prosecuted; in a nutshell, the plaintiff, his tutor (who I understand to be his wife), and his legal advisers wish to take an understandably cautious approach to this whole litigation.

Determination

17. Turning to my determination, in my opinion there are many factors here that argue for caution, as follows.

18. First, speaking generally, in my opinion a cautious approach to litigation in which one bears the onus of proof is often appropriate.

19. Secondly, in what could be an all or nothing case in which the plaintiff faces undoubted legal and evidential hurdles, further caution is self-evidently sensible.

20. Thirdly, when costs could be catastrophic, even more caution is called for.

21. Fourthly, when there is a significant possibility that an undoubtedly cognitively impaired person and his spouse could be left with nothing by way of damages, on top of his permanent disabilities, plus a costs order in the tens or hundreds of thousands of dollars, that would be a disastrous concatenation.

22. Separately from those sound bases for caution, there is nothing to suggest that the tutor is motivated by anything other than love and support for her husband. Nor is there anything to suggest that his lawyers are motivated by anything other than a thoroughly professional desire to achieve the best outcome for their client.

23. Finally, I was assured by senior counsel that all of the deductions that are contained in the draft orders with which I was kindly provided are entirely orthodox and appropriate, including the measure of legal costs.

24. I was also assured that there is no question but that the significant sum agreed upon would be placed in the hands of a financial manager in due course.

25. In all the circumstances, I am soundly satisfied that I should approve this settlement, on the simple basis that it is indeed in the best interests of the plaintiff.

26. In conclusion, I note that, when this judgment and orders are placed on NSW Caselaw, the various sums contained in the latter will be redacted, not only to protect the privacy of the plaintiff, but also because I believe that it is not inappropriate to minimise publicity with regard to a cognitively impaired person coming into a large sum of money.

Orders

27. I make the following orders:

1. Judgment for the Plaintiff against the Defendant in the sum of XXX (Judgment Sum).

2. The Defendant to pay the Plaintiff's costs and disbursements agreed in the sum of XXX.

3. The net sum remaining after deduction referred to in paragraphs (5) to (9), is to be paid into court in accordance with section 77(2) of the Civil Procedure Act 2005.

4. Thereafter, in accordance with section 77(4) Civil Procedure Act 2005, the money paid into court is to be paid to the financial manager of the Plaintiff's estate, to apply the settlement monies for the maintenance or otherwise for the benefit of the Plaintiff, pursuant to orders to be granted by the Queensland Civil and Administrative Tribunal.

5. The Plaintiff acknowledges that this settlement is subject to the provisions of the:

1. Health and Other Services (Compensation) Act 1995 (Cth);

2. Health and Other Services (Compensation) Care Charges Act 1995 (Cth);

3. Social Security Act 1991;

4. Health Services Act 1997 (NSW); and

5. National Disability Insurance Scheme Act 2013 (Cth).

6. The Plaintiff acknowledges that he may be obligated to pay from the Judgment Sum an amount pursuant to the provisions of the:

1. Health and Other Services (Compensation) Act 1995 (Cth); and/or

2. Health and Other Services (Compensation) Care Charges Act 1995; and/or

3. Social Security Act 1991 (Cth); and/or

4. Health Services Act 1997 (NSW); and/or

5. National Disability Insurance Scheme Act 2013 (Cth).

7. The Plaintiff consents to the Defendant:

1. notifying Medicare Australia of the settlement of the Plaintiff's claim and ascertaining whether the Plaintiff has an obligation to repay an amount pursuant to the provisions of:

1. Health and Other Services (Compensation) Act 1995 (Cth); and/or

2. Health and Other Services (Compensation) Care Charges Act 1995; and/or

2. notifying Centrelink of the settlement of the Plaintiff's claim and ascertaining whether the Plaintiff has an obligation to repay an amount pursuant to the provisions of the Social Security Act 1991 (Cth); and/or

3. notifying the relevant health organisation(s) of the settlement of the Plaintiff's claim and ascertaining whether the Plaintiff has an obligation to repay an amount pursuant to the provisions of the Health Services Act 1991 (NSW).

4. Notifying the National Disability Insurance Agency of the settlement of the Plaintiff's claim and ascertaining whether the Plaintiff has an obligation to repay an amount pursuant to the provisions of the National Disability Insurance Scheme Act 2013 (Cth).

8. The Plaintiff consents to and authorises the Defendant to pay from the Judgment Sum:

1. any amount notified by Medicare Australia as due and payable as a consequence of the settlement of the Plaintiff's claim; and/or

2. any amount notified by Centrelink as due and payable as a consequence of the settlement of the Plaintiff's claim; and/or

3. any amount notified by a relevant health organisation(s) as due and payable as a consequence of the settlement of the Plaintiff's claim; and/or

4. any amount notified by the National Disability Insurance Agency as due and payable as a consequence of the settlement of the Plaintiff's claim.

9. The Plaintiff undertakes and agrees to pay out of the Judgment Sum any amount repayable by the Plaintiff to any person or body whether in respect of payments made and/or benefits received, including but not limited to: payments and/or reimbursements made to the Plaintiff by insurers and/or others; hospital fees and/or out-of-pocket expenses or charges; medical fees and/or out of pocket expenses or charges; ambulance fees and/or out of pocket expenses or charges; accident pay; compensation; charges assessed or otherwise if those amounts are not paid by the Defendant prior to the payment by the Defendant of the Judgment Sum.

10. No interest is payable in respect of the Judgment Sum if it is paid within 28 days from the date of this Consent Judgment or within 28 days after the receipt of:

1. an Authority to Receive;

2. a copy of the Consent Judgment sealed with the Court seal; and

3. appropriate clearances or notifications as set out in this Consent Judgment in respect of amounts owing by the Plaintiff to Medicare Australia, Centrelink, any relevant health organisation, the National Disability Insurance Agency and/or any others,

11. whichever is later.

12. No interest is payable by the Defendant in respect of any payment made to:

1. Medicare Australia in complying with its obligations under the Health and Other Services (Compensation) Act 1995 and/or Health and Other Services (Compensation) Care Charges Act 1995 (Cth); and/or

2. Centrelink in complying with its obligations pursuant to the Social SecurityAct 1991 (Cth) or any other legislation; and/or

3. any relevant health organisation in complying with its obligations pursuant to the Health Services Act 1997 (NSW); and/or

4. National Disability Insurance Agency in complying with its obligations under the National Disability Insurance Scheme Act 2013 (Cth).

13. The Plaintiff hereby agrees to release the Defendant absolutely from all claims, demands and liabilities of whatever nature whether at law or in equity arising out of the subject matter of this proceeding.

14. All previous orders of the Court in relation to costs are dismissed.

15. This Consent Judgment is not to be disclosed by the Plaintiff except as required at law.

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Decision last updated: 28 June 2019