Victorian WorkCover Authority v Serco Australia Pty Ltd
[2013] VCC 1191
•20 August 2013
| IN THE COUNTY COURT OF VICTORIA AT Melbourne CIVIL DIVISION | Revised Not Restricted Suitable for Publication |
DAMAGES AND COMPENSATION LIST
general DIVISION
Case No. CI-10-05818
| VICTORIAN WORKCOVER AUTHORITY | Plaintiff |
| v | |
| SERCO AUSTRALIA PTY LTD | Defendant |
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JUDGE: | HIS HONOUR JUDGE BROOKES | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 12, 14, 15, 16 and 19 August 2013 | |
DATE OF JUDGMENT: | 20 August 2013 | |
CASE MAY BE CITED AS: | Victorian WorkCover Authority v Serco Australia Pty Ltd | |
MEDIUM NEUTRAL CITATION: | [2013] VCC 1191 | |
REASONS FOR JUDGMENT
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Subject: ACCIDENT COMPENSATION
Catchwords: Indemnity – labour hire arrangement – third-party recovery
Legislation Cited: Accident Compensation Act 1985, s138; Occupational Health and Safety Regulations 2007; Occupational Health and Safety Act 2004
Cases Cited:Victorian WorkCover Authority v Gray’s House Removalists Pty Ltd [2005] VSC 451
Judgment: Breach of common law duty by third-party defendant – breach of Occupational Health and Safety Regulations 2007 by third-party defendant – contributory negligence not established – breach of duty by non-defendant employer established – defendant’s contribution to injury 70 per cent – general damages awarded – economic loss – work incapacity – past and future medical expenses.
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | Mr D McWilliams | Russell Kennedy |
| For the Defendant | Ms R N Annesley | Meridian Lawyers Limited |
HIS HONOUR:
1 Between December 2007 and 6 March 2008, Brian Ferguson (“the worker”) suffered a left lateral epicondylitis, otherwise known as tennis elbow (“the injury”) in the course of his employment with Smiths Recruitment Victoria Pty Ltd (“the employer”) at various premises in and around Holland Park, North Melbourne. At all relevant times, the worker was engaged in gardening duties which involved a degree of repetitive work with a brushcutter, and driving a ride-on mower with allegedly vibrating steering (“the work”).
2 On or about 12 March 2008, the worker made a claim against his employer for compensation pursuant to the Accident Compensation Act 1985 (“the Act”).[1] That claim was accepted and he was paid an amount of approximately $78,774.64 pursuant to a s239A certificate of the Act.[2]
[1]exhibit F
[2]exhibit A
3 In this proceeding, the plaintiff, the Victorian WorkCover Authority (“VWA”), seeks an indemnity pursuant to s138 of the Act in respect of the payments of compensation made in relation to the worker’s injuries.
4 The relevant provisions of s138 of the Act applicable to this claim are ss(1) to ss(3). Those sub-sections provide:
“(1)Where an injury or a death for which compensation has been paid, or is or may be payable, by the Authority, a self-insurer or an employer was caused under circumstances creating a liability in a third party to pay damages or that would have created such a liability if the injury or death had been caused in Victoria or that would, but for section 134A, create such a liability in respect of the injury or death, the Authority, self-insurer or employer is entitled to be indemnified by the third party in accordance with this section.
(2)In determining for the purposes of subsection (1) whether an injury or death was caused under circumstances creating a liability in a third party to pay damages or that would have created such a liability if the injury or death had been caused in Victoria in respect of the injury or death, Divisions 8A and 9 of Part IV must not be taken into account.
(3)The amount which a third party is required to pay as indemnity under subsection (1) is the lesser of—
(a)the amount of compensation paid or payable under this Act in respect of the injury or death; and
(b)the amount calculated, were it not for the provisions of this Act, the Transport Accident Act 1986 and Parts VB, VBA and X of the Wrongs Act 1958, in accordance with the formula—
where—
Xis the extent, expressed as a percentage, whereby the third party's act, default or negligence caused or contributed to the injury or death;
Ais the amount of damages (disregarding the extent, if any, whereby any other person's act, default or negligence caused or contributed to the injury or death) for pecuniary loss and non pecuniary loss which the third party is or would have been liable to pay in respect of the injury or death;
Bis the amount recovered or recoverable by the Authority, the self-insurer or the employer under section 137 from the Transport Accident Commission (otherwise than under a settlement);
Cis the amount paid by the third party in respect of the injury or death to the worker or the dependants of the worker under any settlement of, or judgment in, an action by the worker or dependants of the worker against the third party.”
5 The VWA contends that the defendant was negligent, and that this negligence was a cause of the worker’s injuries. It concedes that there is still an issue remaining in the proper quantification of Factor X and Factor A. On the other hand, the defendant denies that it was negligent, and denies that any negligence that might be found was causative of the worker’s injuries. Alternatively, it asserts that it was the employer’s negligence which caused the worker’s injuries and/or alternatively, the negligence of the worker himself. Factor X should be reduced accordingly, and it is suggested to a figure of 50 per cent if the defendant is liable at all.
Causation
6 Virtually all medical practitioners accept that the worker, at all material times following April 2008, was suffering from bilateral tennis elbow which had been contributed to by the nature of his employment whether it was by way of the brushcutter; alternatively, the lawnmower, or generally.
7 What was in dispute is whether or not the defendant had breached its common-law duty, and its duty pursuant to the Regulations appended to the Occupational Health and Safety Regulations 2007, which in turn, was a cause of those injuries.
8 In the Statement of Claim herein, the plaintiff cites particulars of negligence which can generally be described as generic; however, in Particular K, it alleges that the defendant failed to meet the requirements of the Occupational Health and Safety Act 2004, and the Regulations made thereunder. In particular, in a document delivered during the course of this hearing, the plaintiff alleges that the defendant is in breach of various Regulations contained in Regulation 2 and Regulation 3 therein.
The facts
9 The essential claim by the plaintiff in this case is the evidence delivered by the worker in viva voce evidence to the following effect:
Q:“Did you complain about pain in your left arm on any other occasion?---
A:Yes, I mentioned it again as it became worse. I mentioned it again at least a couple more occasions and yes, eventually it got chronic to the point that I had to take a day off work, and then was put on - you know, put on light alternate duties.”[3]
[3]Transcript (“T”) 57, L24-29
10 The plaintiff was cross-examined to the following effect:
Q:“Then you make your incident report on 7 March 2008, you worked the day before didn’t you?---
A:Yes, yes, I believe I did from memory.
Q:And you performed normal duties the day before?---
A:I believe I did, yes, yes.
Q:And you made no complaint at the end of that day that you had suffered, or experienced any difficulties, or injury as a result of the work that you were performing?---
A:I believe that I mentioned it to Luke [Raines] on several occasions that I was experiencing soreness, and I believe at the end of that day that I mentioned it to him that it was severe, but it was some time so it’s difficult to recall.”[4]
[4]T175, L19-30
11 Again, the plaintiff was cross-examined to the following effect:
Q:“I suggest to you that you never told Mr Raines, or anyone from Serco that you had a brace on your arm?---
A:Luke would have observed me wearing it on a daily basis, yes, and I told him.
Q:You didn’t tell him that you were wearing it, did you?---
A:Yes I did, I did tell him, yes.
Q:And that you made no specific complaint of injury as a result of the duties that you were performing prior to putting in your incident report form on 7 March 2008?---
A:I remember mentioning it to him several times that I was getting a sore left arm, yes.”[5]
[5]T177, 2-12
12 The defendant, through its evidence from the supervisor, Mr Raines, denied that any such complaint was made of a sore left elbow at any material time, and that if such a complaint had been made, it would have been investigated by the defendant through its proper officers. The defendant called Mr Raines, the supervisor, and Mr Patterson, the operation’s officer, to give evidence about the systems of work at the time and in particular, the response to claims of injury. The defendant also called Mrs Hunter, who was a fellow worker, to give evidence to similar effect.
13 I find that all witnesses in this case were doing the best to tell the truth, and to recollect what occurred at material times between December 2007 and March of 2008.
14 Mr Raines was cross-examined about a statement he had made to investigators on or about 29 September 2009. He conceded that his memory would be better then than it is now.[6] In that statement, at page 3, he stated:
“Because it happened so long ago I don’t recall detailed information about the matter. I have a vague recollection that he might have mentioned having a sore elbow in the past, but he had not given me the impression that it was anything to do with work. ... I don’t have a detailed recollection about the circumstances of his injury, or the manner in which he reported it.”
[6]exhibit M
15 Accordingly, in my view, given that the worker made a Claim for Compensation on 12 March 2008[7] and that such claim was accepted by the employer in circumstances where there was admitted consultation between the employer and the defendant, I prefer the worker’s recollection that complaints had been made from time to time following the onset of symptoms some time in or about December of 2007.
[7]exhibit F
16 In that claim, the worker alleged a tennis left elbow suffered in the course of his employment due to “repetitive strain injury sustained over about three months from using the brushcutter, and landscaping”. As already indicated, the employer accepted liability for the claim and I am told, without objection, that approximately 134 weeks of compensation were paid in respect thereto.
17 It is common ground in this case that the employer hired the worker’s labour to the defendant, Serco Australia Pty Ltd. It is also common ground that by reason of this arrangement, the worker became subject to the direction, control and supervision of the defendant, its servants or agents.
18 It is not in dispute that at all material times the worker was acting in the course of and/or within the scope of his employment with the employer and under the direction of the defendant. It is also not in contention that the worker was required to perform physical duties, including brushcutting, mowing lawns and carrying rubbish, using plant and equipment provided by the defendant at various sites in and around North Melbourne.
19 In those circumstances, the defendant in this case does not dispute that it owed a duty of care to the worker akin to that owed by an employer to an employee. It does, however, strenuously contend that it is not in breach of that duty, and particularly not in breach of the Regulations as alleged. In essence, it accepts that if the worker had made complaints of soreness in the left elbow, it would have required a suitable response from Mr Raines or officers of the defendant.
Liability
20 Tendered in evidence was a photograph of the relevant brushcutter, together with instructions with respect thereto.[8] At page 3 of the instructions, a warning was given to the following effect:
“As more fully explained later in these safety precautions, to reduce the risk of personal injury make sure your unit is equipped with the proper handle, harness and deflector for the type of cutting attachment that you are using.”
[8]exhibit D
21 At page 21 of the instructions, a diagram of a harness no. 21 is signified as appropriate for the type of brushcutter in use as defined in diagrams 17, 18 and 19. It is common ground in this case that at the time that the worker was said to be suffering complaints of pain in his left elbow, he was not instructed to use a harness at Holland Park.
22 In October 2004, the defendant issued a risk assessment document entitled “Hazard Identification and Risk Management with respect to Brushcutting and Trimming Instruments”. The first hazard that was identified was the possibility of insufficient operator training in safe use. In particular, a possible outcome was designated “manual handling injury”. The risk control measures identified therein included the following:
“Adjust safety harness [sling] so that shoulders, arms and hands are in a relaxed position, and the back is straight.”[9]
[9]exhibit L, page 6 of 42
23 Further in the document, a hazard is identified as “manual handling issues associated with operation” which included “lifting or lowering, holding”. The risk control measures were identified as follows:
“Ensure that sling is attached in the correct manner to the brushcutter, and is adjustable to suit variable operator size.”
and “Administrative control”:
“Manual handling training to be provided to avoid awkward postures and straining movements encountered in maintaining control of the unit.”[10]
[10]exhibit L, page 7 of 42
24 The third hazard identified in the document was “vibration”. The possible outcome was identified as:
“Prolonged operation could result in injury to the back of the operator, or Reynard’s Syndrome ‘vibration, white finger’.”
25 The risk control measured identified was:
“Non use if excessive vibration encountered … provision of vibration absorbing gloves.”[11]
[11]exhibit L, page 8 of 42
26 The defendant tendered in evidence a document entitled “Occupational Health & Safety Management Plan” which was said to be applicable as at September of 2007, wherein the system for reporting an incident or a hazard is set out.[12] At paragraph 8.2 entitled “Internal reporting”, the following direction is given:
“Serco requires that all incidents, including those of a seemingly minor nature be recorded to a hazard/incident report form … . Serco reportable incidents and hazards include: Injuries to staff no matter how minor, including: injuries requiring no treatment, injuries treated by bandaid … The supervisor of the injured person shall ensure hazard/incident report form is completed and submitted. In case the injured person is unable, a work colleague, or supervisor shall complete a hazard incident report form.”
[12]exhibit 2, page 13 of 22 at paragraph 8
27 At paragraph 8.3 therein under the heading “Incident/hazard investigation”, it is recited:
“All work related incidents, hazards and near hits (whether or not there was medical treatment by a doctor, an ambulance, hospitalisation, or whether the injured employee did not continue work shall be considered to be investigated. The supervisor in cooperation with the operation’s manager and the employee shall determine whether an investigation is warranted.”[13]
[13]exhibit 2, page 15 of 22
28 The defendant tendered in evidence an Incident Hazard Report Form dated 10 July 2007[14] concerning its own employee, a Mr Christian Duckworth, who was also called to give evidence. He had apparently suffered from a right elbow injury which had been aggravated when performing work with a hedge trimmer. At the foot of that document, paragraph 7 recites:
Q: “Has the injured person made any claim?---
A: No.”
[14]exhibit 12
The incident investigation (PTR)
29 Over the page, from paragraphs 8 to 11, are the results of an investigation that had apparently been carried out following this complaint of injury.
30 Following the protocol already identified by exhibit 2, the worker in this case, Mr Ferguson, completed an Incident Hazard Report Form on or about 27 December 2007 with respect to a lower back pain suffered in the course of his work. The form in this case (following paragraph 7) does not recite "Complete the incident investigation (PTO)” but states “Incident investigation required? If no, give reason. Yes, go to next page.”
31 This section of page 1 is left blank so that the inference is that the supervisor had not turned his mind to whether an incident investigation was required, and therefore had left this section blank. Evidence has been given by Mr Patterson that a search was made for the second part of this Incident Report Form, which may have cast some light onto whether any investigation was made.
32 I accept that a genuine attempt was made to find page 2, but given that the section referred to on page 1 is left blank, I find that it is more probable than not that the supervisor did not consider whether an incident investigation was required.[15]
[15]exhibit 15
33 On 7 March 2008, the worker, Mr Ferguson, made an Incident Hazard Report Form concerning his left elbow pain which was described as “Chronic pain in left elbow. RSI has gotten worse over the last three months.” The medical action taken was “went to doctor”.
34 Once again, paragraph 7 has recited “Has the injured person made any claim?” This time it was circled ‘yes’ and details were said to be “WorkCover”. Once again, where it is recorded “Incident investigation required”, the form is left blank. Once again, I am advised that a search was made for page 2 which may have cast some light on whether any investigation may have been made, and none could be found. I accept that a genuine attempt was made, but also prefer the inference that the supervisor did not turn his mind to whether or not an incident investigation was required which, in my view, is in breach of the protocols set out earlier.
Liability
35 In my view, the plaintiff has proved that the defendant is in breach of Regulation 2.1.1 (1) of the Occupational Health and Safety Regulations 2007, in that the defendant:
(i) did not require the worker to use a sling when operating the brushcutter;
(ii) failed to provide shock absorbent gloves to the worker for use of the brushcutter.
36 Further, it failed to respond or respond adequately to complaints about physical symptoms with respect to the left elbow. I also find the defendant was in breach of Regulation 2.1.2(1), in that it had failed to train the worker as to the requirement to wear a sling when operating the brushcutter. I find that it is also in breach of Regulation 3.1.2(1), in that it failed to ensure that a risk of musculoskeletal disorder associated with hazardous manual handling was eliminated so far as is reasonably practicable, and in particular, it failed to require the worker to use a sling while operating the brushcutter and it failed to respond appropriately to complaints made by the worker in relation to his physical symptoms.
37 I also find that it was in breach of Regulation 3.5.23(1), in that it failed to identify all hazards in relation to the systems of work associated with plant, and in particular, the risk of using a brushcutter without a sling.
38 I have not canvassed the rest of the evidence tendered by the plaintiff, or the defendant in this regard, as I have already indicated that I accept that all witnesses were essentially witnesses of credit to the best of their ability, but I also accept that the defendant was in breach of its duty as employer of the worker either at common law, and in particular, as being in breach of the regulations aforesaid.
39 This leads to the question as to whether the employer and/or the worker were also in breach of their respective duties. It was not in dispute that the employer owed the worker a non-delegable duty with respect to the various duties pleaded, and in particular, the duty to take reasonable steps to provide reasonable plant and equipment and a safe place of work. Given that the system of work led to breaches as aforesaid, and the worker was injured on account of those breaches of same, there would appear to be no need to further explore the issues of duty and breach with respect to the employer.
40 With respect to the worker, I am not satisfied that the defendant has discharged its onus of proof in proving that he was contributorily negligent in this regard. Having found that he made complaints of left elbow pain, and having found, on balance, that they were not appropriately addressed, it appears to me that he was otherwise following a system of work laid down by the employer.
41 With respect to Factor X, I accept, in essence, the submissions of the plaintiff’s Counsel that this is a true labour hire situation where the only evidence of the contact the employer had with the worker was the payment of his wages, a conference with his general practitioner after the complaint of injury, and with the defendant post accident.[16]
[16]exhibit B and T441
42 Further, the defendant inducted the plaintiff, directed the worker in his duties and it was the defendant to whom the worker was answerable, and it was the defendant who was meant to address any problems that he had in terms of the system of work or symptoms suffered therein. The worker wore the defendant’s uniform, as did all workers, save for one or two employees of Smiths. The majority of the employees were Serco employees. It was agreed that Serco could discipline the worker, and the supervisors in the workplace were all Serco employees.[17]
[17]T229 (Mr Raines)
43 Both Counsel put forward figures ranging from 50 per cent to 75 per cent as being appropriate for Factor X, with the remaining percentage to be allocated to the employer’s non-delegable duty to the worker.
44 Doing the best I can in all the circumstances, I consider that Factor X should be 70 per cent, in line with the reasoning by his Honour Justice Cummins in Victorian WorkCover Authority v Gray’s House Removalists Pty Ltd.[18]
[18][2005] VSC 451 at paragraphs [1] and [56]-[66]
Factor A
45 The worker attended upon Dr Ouna until about October 2008. During that relatively short period he was certified unfit for work.[19] Dr Ouna administered a cortisone injection in both elbows in May of 2008. Further injections were administered to both elbows in July 2008, and he was prescribed analgesic medication. From about October 2008, the worker attended upon Dr Helen Sutcliffe, occupational physician, and from early 2009, he was treated by an occupational physician, Dr Charles Castle, who shared rooms with Dr Sutcliffe.[20]
[19]exhibit P
[20]exhibit W
46 Dr Castle arranged for an MRI scan of the worker’s elbows, and referred him to Mr Raymond Crowe, an orthopaedic surgeon, whom he saw in May of 2009.[21] Dr Castle also referred the worker to Dr Clayton Thomas, a pain management consultant.[22]
[21]exhibit 21
[22]exhibit 22
47 Before moving to Adelaide some time last year, the worker was treated by another general practitioner, Dr Andrianakis.[23] Until moving to South Australia, he was again prescribed analgesic and anti-inflammatory medication. Dr Andrianakis had referred the worker to a hand specialist, Mr Tim Bennett, in April of 2011. Mr Bennett had administered a further steroid injection in the left elbow at that time. As no improvement was acknowledged, Mr Bennett had considered surgery as a viable option, but which was reasonably refused by the worker.[24]
[23]exhibit AA
[24]exhibit 2
48 An X-ray and ultrasound of both elbows was conducted in October 2008. The radiologist concluded there was evidence of mild common extensor tendinosis bilaterally without findings of tendon tear or underlying abnormality.[25]
[25]exhibit G
49 In April 2011, further ultrasounds were conducted on both elbows. The radiologist reported the appearances were those of bilateral extensor tendon origin tendinopathy with no other abnormal findings.[26]
[26]exhibit J
50 A number of medical practitioners who have examined the plaintiff have diagnosed him with bilateral epicondylitis, otherwise known as tennis elbow.[27]
[27]See Mr Bennett, exhibit 2; Dr Sutcliffe, exhibit R; Mr Kudelka, exhibit S and Mr Jones, exhibit O
51 Although other practitioners were less sure of the diagnosis, for example preferring a non-specific pain syndrome or fibromyalgia, it would appear that the worker has a medical basis for ongoing complaints of pain bilaterally.[28]
[28]See Dr Blombery, exhibit Y
52 Counsel for the defendant submitted that the right elbow should not be compensable in these proceedings due to no breach of duty being established in the period when the worker was working at Princes Park following the first claim for injury.
53 I am inclined to agree with this submission in the way that it was argued, as the proof with respect to breach of duty was quite thin during this period. However, the evidence has been given by the worker that he favoured the use of the right arm during this period of employment, because of the symptoms suffered by the left arm. And I accept that in this regard, there has been some contribution from the left arm injury to the right arm injury in the manner already described during the period December 2007 till March 2008.
54 In any event, not much turns on a finding of whether the right elbow is compensable, because of the submissions reasonably made by both Counsel as to the range of general damages that would be appropriate. Defence Counsel submits that the only injury opened on the evidence is a left elbow injury, and that an appropriate sum for general damages should be $40,000. Counsel for the plaintiff argues that an appropriate sum ought to be $50,000.
55 In my view, both Counsel were being very reasonable in their submissions, and doing the best I can, I find that the figure postulated by the plaintiff's Counsel is more appropriate to the injury to the left elbow alone, and I find general damages in this case to be $50,000.
Economic loss
56 The worker in this proceeding has given evidence and been cross-examined to the following effect, that both elbows still give him ongoing pain, and that in fact he is in receipt of an Invalid Pension on account of his injuries, which it must be said include a pre-existing back injury. At common law, it would be open to a jury to consider the plaintiff’s evidence referred to, and make a finding that he had an ongoing incapacity, and perhaps given the length of time that has evolved, for a considerable time into the future.
57 Defence Counsel argues that there ought to be a limited period of incapacity in the vicinity of $4,000. In my opinion, it is less likely that a jury would so find on the medical evidence adduced in this case given that they have to determine the question of damages. Without analysing in depth the various doctors and their opinions, I assess incapacity in the following manner. Given that Mr Jones had indicated that the condition can last for a period of approximately two years, and given that the worker has complained of a condition ongoing until the present time, I consider that the plaintiff’s submission of 130 weeks of incapacity is appropriate in this case, and I will allow the figure of $90,000 in respect of that period. Included in this calculation would be any claim for future economic loss, and I allow no further sum for that figure. I accept that there is evidence of ongoing incapacity from the worker, but I also accept that a jury would be likely to favour medical evidence to the effect that the ongoing work relationship is minimal.
58 The parties have agreed that the past medical expenses are probably not unreasonable, and no complaint is made that there should be division between the left and the right elbow, so the figure of $20,261.25 will be allowed.
59 As to future medical and like expenses, the parties were again reasonable in their submission, and doing the best I can, I find that a figure of $2,000 should be set aside for future medical and like expenses.
60 That being the case, in my calculation, the figure for Factor A is the sum of:
General damages - $50,000.00
Economic loss - $90,000.00
Past medical expenses - $20,261.25
Future medical expenses - $2,000.00
__________
Total: $162,261.25
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61 When this figure is multiplied by 70 per cent for Factor X, my calculation is that is a figure of $113,582.70. Both Counsel agreed with my arithmetic.
62 That being the case, in accordance with the statutory formula, I find that the plaintiff is entitled to be indemnified to the extent of the lesser sum of $113,582.70, or the amount paid as compensation which, pursuant to exhibit A, is $78,774.64 (Seventy-Eight-Thousand-Seven-Hundred-and-Sixty-Four-Dollars).
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