Sydney South West Area Health Service v Palau
[2012] NSWWCCPD 20
•4 April 2012
| WORKERS COMPENSATION COMMISSION | |||||
| DETERMINATION OF AN APPLICATION TO STRIKE OUT A PRE-FILING STATEMENT | |||||
| CITATION: | Sydney South West Area Health Service v Palau [2012] NSWWCCPD 20 | ||||
| APPLICANT DEFENDANT: | Sydney South West Area Health Service – Bowral Hospital | ||||
| RESPONDENT CLAIMANT: | Marlene Palau | ||||
| FILE NUMBER: | 11257/11 | ||||
| DATE OF DECISION: | 4 April 2012 | ||||
| SUBJECT MATTER OF DECISION: | Application to strike out pre-filing statement; s 151DA of the Workers Compensation Act 1987 | ||||
| PRESIDENTIAL MEMBER: | President Judge Keating | ||||
| HEARING: | On the papers | ||||
| REPRESENTATION: | Applicant Defendant: | Thompson Eslick Solicitors | |||
| Respondent Claimant: | Firths – The Compensation Lawyers | ||||
ORDERS MADE ON APPLICATION: | The application to strike out the claimant’s pre-filing statement is dismissed. The applicant defendant is to pay the respondent claimant’s costs of the application. | ||||
THE APPLICATION
This is an application filed by the defendant, seeking an order, under s 151DA of the Workers Compensation Act 1987 (the 1987 Act), that the plaintiff’s pre-filing statement served on 6 December 2010 be struck out.
BACKGROUND TO THE APPLICATION
On 10 March 2004, in the course of her employment as a registered nurse, Ms Palau observed a visitor struggling to assist a patient towards the shower area at Bowral Hospital. As she attempted to help, the patient reacted violently, as a result of which Ms Palau stretched awkwardly, and injured her back.
Since June 2004, Ms Palau has been incapacitated and in receipt of voluntary payments of workers compensation.
On 6 April 2005, Ms Palau submitted to an L3/4 spinal fusion.
On 7 November 2008, the parties agreed that Ms Palau was entitled to compensation under s 66 of the 1987 Act in respect of 22 per cent whole person impairment. The parties recorded their agreement in a complying agreement pursuant to s 66A of the 1987 Act.
On 7 August 2009, at the request of the claimant, the defendant conceded that Ms Palau’s impairment for the purposes of claiming work injury damages exceeded the statutory threshold of 15 per cent. At the same time, the defendant wholly denied liability in respect of the work injury damages claim. Between September and December 2009, various particulars were sought and provided in support of Ms Palau’s claim.
On 1 December 2010, Ms Palau’s solicitors wrote to the defendant, making a further demand under s 66 for lump sum compensation in the sum of $40,000 in respect of a 16 per cent additional whole person impairment. Ms Palau sought an additional $15,000 in compensation for pain and suffering pursuant to s 67.
On 6 December 2010, a pre-filing statement dated 3 December 2010 was served on the defendant.
On 19 January 2011, a pre-filing defence was served on Ms Palau.
On 15 July 2011, Ms Palau sought a response to the demand of 1 December 2010.
On 20 July 2011, the defendant responded to the demand, noting, among other things, that the medical report of Dr Patrick, provided in support of the further claim for lump sum benefits, was deficient in a number of respects. The letter concluded in the following terms:
“In the circumstances and given both the delay and the inadequacy of Dr Patrick’s response, we are instructed to inform you that our client will arrange for your client to be re-examined by an independent medical examiner as allowed by the guidelines.
Details of the examination will be provided to your client under separate cover.”
It is common ground that no further examination was arranged by the defendant. It would appear that no further steps were taken by either party to advance the matter prior to the filing of the defendant’s application.
On 16 December 2011, the defendant filed an Application to Strike Out a Pre-filing Statement. The defendant seeks an order that the pre-filing statement of 3 December 2010 be struck out under s 151DA(3) of the 1987 Act.
On 1 March 2012, the claimant filed a Notice of Opposition to Strike Out a Pre-filing Statement. The claimant sought an order that the defendant’s Application to Strike Out a Pre-filing Statement be refused, and provided submissions in support.
On 5 March 2012, the defendant filed submissions in reply to the Notice of Opposition.
On 27 March 2012, the claimant’s solicitors wrote to the Registrar of the Commission, providing further submissions in defence of the Application. The correspondence concluded by stating:
“The President can be satisfied that the claimant most certainly intends to prosecute the work injury damages claim once the further s 66/67 claim has been resolved.”
Pursuant to s 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act), if the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under the Act without holding any conference or formal hearing.
Both parties have indicated that they are content for the matter to be determined on the papers.
I am satisfied that I have sufficient information to proceed on the papers without holding a formal conference or hearing, and that is the course I propose to adopt.
LEGISLATION
Section 151DA of the 1987 Act provides:
“151DA Time not to run for commencement of proceedings in certain cases
(1) Time does not run for the purposes of section 151D:
(a1)while the determination of the claim concerned is delayed as permitted by section 281 of the 1998 Act, but not including delay beyond 2 months after the claimant has provided all relevant particulars about the claim as required by section 281(2)(b) of that Act, or
Note. Delay in determining a claim beyond 2 months is only permitted on the basis that degree of permanent impairment is not fully ascertainable and the insurer has notified the claimant of this. In such a case, paragraph (a) of this subsection can apply (if a dispute about whether degree of permanent impairment is fully ascertainable is the subject of medical assessment) to further prevent time running for the purposes of section 151D.
(a)while a medical dispute as to whether the degree of permanent impairment of the injured worker is at least 15%, or whether the degree of permanent impairment of the injured worker is fully ascertainable, is the subject of a referral for determination by the Commission or a referral for assessment under Part 7 of Chapter 7 of the 1998 Act (including any further assessment under section 329 of that Act), or
(a2)during the period of 1 month after an offer of settlement is made to the claimant pursuant to the determination of the claim as and when required by the 1998 Act, or
(a3)while an assessment under Part 7 of Chapter 7 of the 1998 Act in respect of a medical dispute referred to in paragraph (a) is the subject of a pending appeal under section 327 of the 1998 Act, or
(b)while a pre-filing statement served in accordance with section 315 of the 1998 Act in respect of the claim concerned remains current.
(2) A pre-filing statement remains current from the time it is served until it is struck out under this section on the application of the person (the defendant) on whom it was served or it is withdrawn by the person who served it, whichever happens first.
(3) The defendant may apply to the President to have the pre-filing statement struck out by order of the President. Such an application may not be made until at least 6 months have elapsed after the defendant served on the claimant a defence to the claim in accordance with section 316 of the 1998 Act.
(4) The President may order that a pre-filing statement be struck out but must not do so if satisfied that the degree of permanent impairment of the injured worker is not yet fully ascertainable and the matter is the subject of a referral under Part 7 of Chapter 7 of the 1998 Act for assessment of the degree of permanent impairment of the injured worker.
(5) A medical dispute is considered to be the subject of a referral for assessment under Part 7 of Chapter 7 of the 1998 Act even if the approved medical specialist has declined to make an assessment of the degree of permanent impairment of the injured worker until satisfied that the degree of permanent impairment is fully ascertainable.
(6) The President may delegate to a Deputy President any function of the President under this section (except this power of delegation), but only if the President is satisfied that the delegation is necessary to avoid a conflict of interest or the appearance of bias.”
Section 280B of the 1998 Act provides:
“280B Lump sum compensation to be paid before damages recovered
(1) An injured worker cannot recover damages in respect of an injury from the employer liable to pay compensation under this Act in respect of the injury unless and until any permanent impairment compensation and pain and suffering compensation to which the worker is entitled in respect of the injury has been paid.
(2) This section does not prevent a claim for damages from being made before any permanent impairment compensation and pain and suffering compensation to which the worker is entitled in respect of the injury has been paid.
Note. This section ensures that an injured worker receives the compensation to which the worker is entitled before damages are recovered (because section 151A of the 1987 Act would prevent the payment of compensation after damages are recovered).”
THE DEFENDANT’S SUBMISSIONS
The defendant submits that the claimant has not sought to remedy the matters referred to in its correspondence to Ms Palau’s solicitors of 20 July 2011 concerning the alleged deficiencies in Dr Patrick’s report, or to have made arrangements for the matter to be referred for assessment by an Approved Medical Specialist, noting that an increase in whole person impairment was claimed since the consent agreement in November 2008.
Notwithstanding the denial of liability, no liability evidence has been served in support of the allegations of breach of duty of care contained within the pre-filing statement and the proposed statement of claim.
More than six months has elapsed since the pre-filing defence has been filed, and therefore the requirements of s 151DA(3) are met.
Ms Palau has not sought to prosecute the claim for work injury damages by seeking mediation or the filing of a statement of claim.
More than seven years have elapsed since the date of injury, more than three years have elapsed since the degree of permanent impairment of the claim was agreed to be 22 per cent, and two years have passed since the defendant conceded the claim had achieved the required threshold to bring a claim for work injury damages.
Ms Palau has not made any attempt to explain the reasons for the delay in prosecuting this claim.
The continuing delay will prejudice the defendant’s defence of the claim, having regard to the passage of time since the injury was sustained.
THE WORKER’S SUBMISSIONS
Ms Palau submits that her condition has deteriorated since the parties entered into an agreement with respect to the claim for whole person impairment compensation on 7 November 2008. This is evidenced by the demand for an additional 16 per cent whole person impairment claimed under cover of a letter dated 1 December 2010.
Ms Palau further submits that the defendant’s correspondence of 22 December 2010 raises various complaints about Dr Patrick’s quantification of her claim for additional lump sum compensation. The defendant asserted that it intended to arrange for a further independent medical examination of Ms Palau, but no such further examination has taken place. She submits that, had she been advised that a further examination was not to take place, she would have taken steps to have the dispute referred to the Commission.
The receipt of the Application to Strike Out a Pre-filing Statement was the first indication to Ms Palau that the defendant was not intending to proceed as indicated in the correspondence of 20 July 2011.
Ms Palau asserts that it is now her intention to refer the dispute to the Commission for referral to an Approved Medical Specialist. She further asserts that, subject to the clarification of her entitlement to additional compensation, she intends to refer the matter to mediation in respect of the work injury damages claim.
Section 280B of the 1998 Act provides that the work injury damages claim cannot proceed unless and until any permanent impairment compensation and any entitlement to compensation for pain and suffering under s 67 to which the worker is entitled in respect of the injury has been paid (worker’s emphasis). In accordance with s 280B(2), Ms Palau is not prevented from making a claim for workplace injury damages before any permanent impairment compensation and compensation for pain and suffering to which she is entitled in respect of the injury has been paid. On this basis, the legislation does not prohibit the claimant proceeding in the manner she has.
It is submitted that the defendant has not made out any “good reason” as to why the pre-filing statement should be struck out. Any delay in prosecuting the claim, it is asserted, rests with the defendant, who has failed to arrange for the medical appointment consistent with its correspondence of 20 July 2011. No explanation for the failure to arrange the further medical examination has been offered.
DEFENDANT’S SUBMISSIONS IN REPLY
There is no dispute that the permanent impairment threshold for claiming work injury damages has been reached. This was accepted by the defendant on 7 November 2008, when it entered into the complying agreement, and was again confirmed in correspondence on 7 August 2009.
The defendant’s failure to arrange for the further medical examination did not inhibit the claimant from proceeding with the claim by referring it to the claims assessment service after two months from the initial demand on 1 December 2010 in the absence of a satisfactory response from the defendant.
The claimant has not lodged an Application to Resolve a Dispute in the Commission, seeking to have the matter referred under Pt 7 of Ch 7 of the 1998 Act for assessment by an Approved Medical Specialist.
The defendant submits that the Commission could not be satisfied that Ms Palau will prosecute the claim for work injury damages, having regard to the delay that has occurred to date, and the time for the bringing of the work injury damages claim should not be extended indefinitely.
DISCUSSION AND FINDINGS
Section 280B of the 1998 Act prohibits the worker from recovering damages in respect of an injury from the employer liable to pay compensation under this Act unless and until any permanent impairment compensation and pain and suffering compensation to which the worker is entitled in respect of the injury has been paid (my emphasis). As the “Note” to s 280B of the 1998 Act indicates, s 151A of the 1987 Act would prevent the recovery of any additional compensation to which Ms Palau is entitled after damages are recovered. Subsection 280B(2) provides that the worker is not prevented from claiming damages before the question of permanent impairment compensation has been resolved and paid.
The defendant has made no response to the submission that, in the circumstances of this case, s 280B of the 1998 Act provides a powerful argument against striking out the pre-filing statement. It would be an anomalous result indeed if Ms Palau’s pre-filing statement was struck out for failing to prosecute her work injury damages claim with due diligence in circumstances where, by virtue of s 280B, she is prohibited from resolving the claim until the dispute in respect of her claim for additional whole person impairment compensation and pain and suffering compensation is resolved and paid. The fact that the defendant has conceded that the permanent impairment threshold for claiming work injury damages has been reached is irrelevant.
I reject the submission that the worker has not sought to prosecute her claim for work injury damages. There is a dispute in relation to her entitlement to additional compensation due to the alleged deterioration of her condition. So much is clear from the terms of the letter from Thompson Eslick, the defendant’s solicitors, dated 20 July 2001. Although the dispute has not been the subject of a referral under Pt 7 of Ch 7 of the 1998 Act, which would have prohibited me from striking the matter out under s 151DA(4), if Ms Palau’s medical evidence is accepted, her condition has deteriorated to a significant extent and she should be afforded the opportunity to recover any lump sum compensation to which she is entitled before pursuing her work injury damages claim.
The defendant somewhat disingenuously submitted that one of the reasons the Commission should strike out the pre-filing statement concerns Ms Palau’s failure to remedy alleged defects in the medical evidence served in support of her claim. It is disingenuous because, having pointed out those defects, the defendant asserted that, in order to assess its liability for any deterioration in Ms Palau’s condition, it would arrange for an independent medical examination. That step was not undertaken and no reasons were given for the failure to do so.
I reject the submission that Ms Palau has not made any attempt to explain the reasons for the delay in prosecuting the claim. The reason given by her is that she understood that arrangements were to be made for her to undergo further medical examination. It is true that, between 20 July 2011 and the filing of the strike-out application, no further steps were taken by the claimant. However, there does seem to have been a degree of confusion between the parties as to what steps were to be taken to resolve the claim for additional compensation under s 66 and s 67. It was reasonable, in my view, for the worker to cooperate in the defendant’s request for her to undergo a further medical examination before proceeding further because the outcome of it may have assisted in resolving the dispute and avoid any further litigation on that issue.
I reject the submission that the alleged absence of liability evidence in support of the allegations of breach of duty of care provides grounds for striking out the pre-filing statement. Whether ultimately liability is established on the available evidence is a matter that will be determined in due course. It may be, for example, that the worker will seek to establish the allegations of breach of duty of care based on her own evidence. However, I reject the submission that the paucity of evidence on the liability issues is grounds for denying the worker’s right to argue her case by striking out her pre-filing statement at this point.
While the continuing delay is less than ideal, no actual prejudice has been asserted. I accept Ms Palau’s assertion that she does intend to pursue her claim for work injury damages immediately the s 66 and s 67 claims are resolved. I would strongly encourage her to do that by promptly making application to resolve the dispute pursuant to Pt 7 of Ch 7 of the 1998 Act.
For these reasons, I am not satisfied that Ms Palau’s pre-filing statement should be struck out.
DECISION
The application to strike out the claimant’s pre-filing statement is dismissed.
COSTS
The applicant defendant is to pay the respondent claimant’s costs of the application.
Judge Keating
President
4 April 2012
I, PENELOPE FLEMING, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF JUDGE KEATING, PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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