Pasminco Cockle Creek Smelter Pty Ltd v Gardner

[2006] NSWWCCPD 108

WORKERS COMPENSATION COMMISSION

DETERMINATION OF AN APPLICATION TO STRIKE OUT A PRE-FILING STATEMENT

CITATION:Pasminco Cockle Creek Smelter Pty Ltd v Gardner [2006] NSWWCCPD 108

APPLICANT DEFENDANT:  Pasminco Cockle Creek Smelter Pty Ltd

RESPONDENT CLAIMANT:  Warren Gardner

FILE NUMBER:  WCC20605-05

DATE OF DECISION:  2 June 2006

SUBJECT MATTER OF DECISION: Application to strike out pre-filing statement; section 151DA of the Workers Compensation Act 1987

PRESIDENTIAL MEMBER:  President Justice Terry Sheahan

HEARING:On the papers

REPRESENTATION: Applicant Defendant: Sparke Helmore

Respondent Claimant: MRM Lawyers

ORDERS MADE ON APPLICATION:              The application to strike out the claimant’s pre-filing statement is dismissed.

The matter is referred to the Registrar for allocation to a mediator forthwith.

No order as to the costs.

BACKGROUND TO THE APPLICATION

1. This is an application by an employer/defendant to strike out a “pre-filing statement” lodged by an injured worker/plaintiff. On 17 May 2002, the Respondent Claimant Mr Gardner sustained serious burns in the course of his employment with the Applicant Defendant, Pasminco Cockle Creek Smelter Pty Ltd (‘Pasminco’). He is now claiming work injury damages in respect of his injury, and there is no dispute between the parties that he reaches the statutory “whole person impairment” threshold for making such a claim.
   
   

2. Pursuant to Section 315(1) of the Workplace Injury and Workers Compensation Act 1998 (the 1998 Act) a claimant who is seeking work injury damages must serve a pre-filing statement on the defendant before he/she “can commence court proceedings for the recovery of work injury damages…”. Mr Gardiner’s solicitors served a pre-filing statement on Pasminco on 29 April 2005, as required by the legislation, and Pasminco responded to the pre-filing statement with service of a defence or reply to it, as required by section 316 of the 1998 Act on 19 May 2005.

1. Under cover of a letter dated 1 December 2005 Pasminco made an application seeking that the President of the Workers Compensation Commission (‘the Commission’) strike out Mr Gardner’s pre-filing statement, pursuant to section 151DA of the Workers Compensation Act 1987 (‘the 1987 Act’). Mr Gardner opposes the application and has sought to be heard on it.
   
   

2. On 5 December 2005 an ‘Application for Mediation to Resolve Work Injury Damages Claim’ (‘the Mediation Application’) was filed with the Commission on Mr Gardner’s behalf. On 19 December 2005 the Commission received a Certificate of Service filed by Mr Gardner’s solicitors noting that that Mediation Application was served on Sparke Helmore Lawyers and Pasminco on 14 December 2005.

1. In response to a Direction issued by the Commission, written submissions from Pasminco dated 19 January 2006 were filed and served, and submissions in reply dated 6 February 2006 were filed and served by Mr Gardner.
   
   

ON THE PAPERS

1. Having regard to section 354(6) of the 1998 Act, and the submissions from both parties, I am satisfied that I have sufficient information to proceed ‘on the papers’ to determine this application, without holding a conference or formal hearing, and that this is the appropriate course in the circumstances.

THE LEGISLATIVE REGIME

1. Section 151D (2) of the 1987 Act provides that:

“ A person to whom compensation is payable under this Act is not entitled to commence court proceedings for damages in respect of the injury concerned against the employer liable to pay that compensation more than 3 years after the date on which the injury was received, except with the leave of the court in which the proceedings are to be taken.”

1. The effect of section 151DA of the 1987 Act is that it suspends time for the purposes of section 151D, in specific circumstances, one of which is that “while a pre-filing statement served in accordance with section 315 of the 1998 Act in respect of the claim concerned remains current.” Pursuant to section 151DA (2) the pre-filing statement remains current until it is struck out by the President on application of the defendant, or withdrawn by the claimant, “which ever happens first”.

1. The legislation is silent as to what grounds such an application to strike out, but allows for the application to be made after 6 months have elapsed from the service of a pre-filing defence, in compliance with the provisions of section 316 of the 1998 Act (see section 151DA (3) of the 1987 Act).

1. Pursuant to section 318A(2) of the 1998 Act, unless the defendant has failed to respond to the claimant’s pre-filing statement within 42 days after it was served on the defendant, a claimant cannot commence court proceedings before he/she seeks a referral for mediation. Such an application must not be made until 28 days after service of the pre-filing statement on the defendant. Court proceedings cannot be commenced for work injury damages “while the claim is the subject of mediation in the Commission”.

1. The legislative intention of the introduction of these provisions in relation to work injury damages claims, following a judicial inquiry in 2001, was to facilitate the resolution of such claims, without the need to commence court proceedings, through the early exchange of information and evidence, and the participation of the parties in mediation. As stated by the Hon John Della Bosca MLC in his second reading speech on the Workers Compensation Legislation Further Amendment Bill (NSW Legislative Council Hansard 28 November 2001 at page 18961):
   
   

   “The pre-litigation process proposed by the bill requires the parties to exchange information early, respond promptly to offers of settlement and, wherever possible, settle matters without the necessity of filing proceedings in the court”.

2. The pre-filing statement is a document that is exchanged between the parties, and it is arguable that it only becomes part of proceedings in the Commission when it is lodged with the Commission such as with the application for mediation. Whilst in the instant case the application for mediation was made after the strike out application was made, the clear intention of the Act is that the President, or a Deputy President on delegation from the President, has the power to strike out the pre-filing statement with the effect of neutralising its impact on suspending time for the purposes of section 151D.
   
   

3. I am satisfied that the power of the President to strike out, as expressed in section 151DA, is based on a broad interpretation of the term “strike out”, and is not limited only to a pre-filing statement lodged with the Commission. Reading it in context, and giving effect to the legislative intention of sections 151DA(3) and (4), this power to strike out the pre-filing statement must extend to pre-filing statements served but not lodged with the Commission.
   
   

4. The interaction of sections 151DA and 151D means that orders made pursuant to section 151DA (4) have a direct impact on the operation of the limitation period. Factors such as the reason for the delay, and any alleged prejudice to the defendant, which are critical considerations in an application seeking leave to extend time for filing after the expiration of a limitation period, are also relevant in the making of orders on a strike out application pursuant to section 151DA.

1. It is clearly not the intention of the legislature that the time limit within which a claimant may bring work injury damages proceedings should be extended indefinitely by the operation of these provisions. Claimants must actively pursue the required steps throughout this pre-litigation process. The pre-filing statement should remain current for the purpose of completing those required steps.
   
   

2. The provisions of section 151DA (4) allowing for the defendant to make an application to strike out the pre-filing statement six months after service of the pre-filing defence, implies that the pre-litigation process should be completed within this time. The primary effect of an order to strike out the pre-filing statement will be to turn the clock back on and allow time for the purposes of section 151D to commence to run again.
   
   

3. Other than the specific exception detailed in section 151DA (4), which is not relevant in this matter, the power to strike out a pre-filing statement is discretionary.
   
   

SUBMISSIONS

1. Essentially, Pasminco submits that Mr Gardiner’s pre-filing statement should be struck out because, pursuant to section 151D, the limitation period for the commencement of court proceedings in respect of the injury expired on 16 May 2005, section 151DA “stops the clock”, and Pasminco, which ceased operations some years ago, is prejudiced by the time lapses incurred in the matter so far.

1. Mr Gardner’s submissions rely (i) on the benefit conferred on him by s 151DA, (ii) on the decision of Pasminco to serve a response to his pre-filing statement on 19 May 2005, (iii) on his filing of an Application for Mediation on 2 December 2005, to which Pasminco responded on 21 December 2005, and (iv) on the silence of section 318A and the Rules as to the time in which the application for mediation is to be made. Mr Gardner also refutes the claim of prejudice, on the basis that his case was disclosed in the pre-filing statement. As there are no grounds to found the strike out application, the application should be dismissed with a cost order in favour of Mr Gardner.

DISCUSSION AND FINDINGS

1. In light of the fact that Pasminco served a reply to the pre-filing statement, pursuant to section 318A(1) of the 1998 Act, Mr Gardner must refer the claim for mediation before commencing proceedings for work injury damages. His referral was not made until after Pasminco made its application to have the pre-filing statement struck out, although it was lodged on 5 December 2005, less than a week after the strike out application was made.

1. Whilst Mr Gardner’s submissions that neither the legislation nor the rules specify that an application for mediation should be made within a particular time are correct, Pasminco is also correct in its submission that the effect of section 151DA is that whilst the pre-filing statement remains current the matter is “in limbo”, and will remain so until the pre-filing statement is struck out or withdrawn.

1. Given that in this case the parties were in agreement on the threshold whole person impairment issue and that an application for mediation was the only formal part of the pre-litigation process to be completed, the application for mediation should have been made at the earliest opportunity, and as soon as practicable, and not, as appears here, when Mr Gardner was prompted to do so after service of Pasminco’s application for strike out.

1. In light of the fact that a current pre-filing statement served in accordance with section 315 of the 1998 Act suspends time for the purposes of the limitation provisions in section 151D of the 1987 Act, and does so for the sole purpose of allowing the parties time to complete the pre-litigation steps required by the Act, it is not to operate such as to unfairly advantage one party over another nor to unfairly burden one party or the other.

1. The pre-filing statement served on Pasminco on 29 April 2005 contained a “Schedule of Evidence relied upon by the Claimant” comprising Mr Gardner’s signed statements, a draft Statement of Claim, photographs, medical reports, wage material, correspondence addressed to Pasminco, its insurer and solicitors and copies of the ‘Application to Resolve a Dispute’ in matter number 20894-04, dated 21 December 2004 and the Application for Registration of Agreement under Section 66A dated 1 March 2005.

1. Pasminco has not asserted (pursuant to section 317 of the 1998 Act) that the pre-filing statement was defective, and both parties are aware of the limits imposed by section 318 of the 1998 Act. Whilst I am clearly sympathetic to Pasminco’s desire to have finalisation of this matter as expeditiously as possible, I am not satisfied, given the content of the pre-filing statement, that the amount of time that has elapsed since the service of the pre-filing defence will cause any prejudice at all to Pasminco.

1. In making any application for a leave to commence proceedings after the expiration of the limitation period, a plaintiff is required to give a full and adequate explanation for the delay  (Salido v Nominal Defendant (1993) 32 NSWLR 524). Whilst the application in the present case clearly differs from an application seeking such leave, the reason or reasons for Mr Gardner’s failure to make application for mediation before being prompted to do so with the service of Pasminco’s strike out application, is/are relevant to the exercise of my discretion. Unfortunately Mr Gardner’s submissions disclose no reason for the delay and do not help me in this regard, but his claims for statutory compensation pursuant to Sections 66 and 67 of the 1987 Act were finalised only in January of this year, and this legislative regime for work injury damages claims is new to all involved in claims of this type.

1. Mr Gardner has now made an application for mediation, a course to which Pasminco promptly consented. Whilst participating in mediation is a prerequisite to the commencement of court proceedings, it is clearly in the interests of both parties that mediation proceed expeditiously, to maximise the opportunity to resolve the work injury damages claim without litigation.

1. In all these circumstances, I, therefore, decline to exercise my discretion to strike out Mr Gardener’s pre-filing statement.

DECISIONS

1. The application to strike out the claimant’s pre-filing statement is dismissed.

1. The matter is referred to the Registrar for allocation to a mediator forthwith. In this regard I note Mr Gardener’s request dated 5 May 2006 that the mediation take place in Newcastle.
   
   
   

1. There will be no order as to the costs of this application.

Justice Terry Sheahan
President  2 June 2006

I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF JUSTICE TERRY SHEAHAN, PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE