Thompson v WorkCover Queensland [2011] QSC 197

Issues: whether the Notice of Claim for Damages (“NOC”) was statute barred by the operation of s.302 of the Workers’ Compensation Rehabilitation Act 2003 (“WCRA” aka Compensation Act) by failure to confirm the terms of the waiver within the limitation period and whether the limitation period could be extended by the operation of s.31 of the Limitations of Actions Act 1974 in circumstances where the material fact alleged was the claim only became worthwhile after his NOC had been delivered.

Facts: the applicant’s claimed injury was Q-Fever and a secondary psychiatric condition. It was common ground the limitation period expired on 2 March 2009 and that WorkCover’s waiver of compliance subject to certain terms was communicated that day to the applicant’s solicitor, but who only confirmed the terms on 6 March 2009. WorkCover’s lawyer subsequently advised on 11 June 2009 that in terms of Handover v Consolidated Meat Group P/L [2009] QSC 41, the claim was statute barred because acceptance of the terms had been communicated after the expiration of the limitation period. The disputed facts were whether the plaintiff was aware of a material fact of decisive nature, namely that his claim become worthwhile on 2 September 2009 (when WorkCover assessed his permanent impairment), after having delivered his NOC on 2 March 2009, claiming $500,000.

McMurdo J

[5] In Handover v Consolidated Meat Group Pty Ltd[1] it was held that s 302(1)(a)(ii) is satisfied only where the insurer’s waiver of compliance with the requirements of s 275 occurs within the (original) limitation period. That conclusion was not challenged here. But for s 276(8), it might have been said that WorkCover had waived compliance with the requirements of s 275, within the limitation period, when it faxed its letter of 2 March 2009. However, s 276(8) provides that in the case of a conditional waiver, s 302(1)(a)(ii) is satisfied upon the claimant’s agreement to comply with the conditions. Clearly, that did not occur here until 6 March 2009. Because this limitation period affects the applicant’s remedy and not his right of action, the expiry of the limitation period was fatal to the proceedings only if WorkCover took the point.[2] WorkCover’s response at first was, on one view at least, inconsistent with an intention to rely upon the expiry of the limitation period. Still, the limitation point was later taken by WorkCover, through its solicitors, and the applicant’s argument accepts that he must obtain an extension of the limitation period until at least 6 March 2009.

[7] As is common ground here, what is described in these cases as the “critical date” is 2 March 2008. Ultimately, the applicant’s case seemed to be put in the alternative. According to the case within his affidavit evidence, a material fact of a decisive character was that his Q-fever is a permanent condition. He became aware of that fact only when receiving WorkCover’s letter of 2 September 2009, which advised that the Medical Assessment Tribunal had assessed him as having a permanent impairment of 8% for the Q-fever and a permanent impairment of 10% for a psychiatric injury, his depression, which has developed as a consequence of the Q-fever. Alternatively, it was argued that, within the period of one year from the critical date, he became aware of sufficient facts to make it worthwhile to sue, although he did not then know that his condition was permanent. That case is based principally upon evidence of an independent solicitor, Mr Schultz.

[14] The applicant’s position as at the critical date was then relevantly as follows. He was continuing to suffer from unresolved Q-fever with associated depression. Although most Q-fever sufferers recover, as he was expected to do, it was uncertain that he would recover and it was expected that he would continue to receive treatment until that two year point in September 2008. With the reduction in his working hours, his income had dropped from about $1,070 per week to about $690 a week. He was still working for the second respondent but there was some uncertainty as to how long that could continue. The reduction in his income had caused him particular stress, causing him to sell the family home. He had complained to his general practitioner in October 2006 of occasional suicidal thoughts. Prior to these illnesses, he had lost the sight of one eye and he was being constantly monitored for potential damage to his good eye from the Q-fever. As to his right of action, the negligence of his employer was apparent and his potential case was not affected by any likely contest on the questions of the defendant’s negligence or its causative effect. There was no apparent basis for a finding of contributory negligence. In short, he had an apparently good case on liability but his likely award of damages was affected by the likelihood that, like most Q-fever sufferers, he would fully recover.

[18] The likelihood of a complete recovery would have affected his award for pain, suffering and loss of amenities. Upon the premise that he would fully recover, his likely award would have been in the range of $40,000 to $60,000.

[19] An award within that range would not have been sufficient to justify the bringing of an action. That is mainly because s 316 of the Compensation Act provides that in a case involving a worker with an RWI of less than 20%, the only costs which can be ordered in the worker.s favour are costs on the standard basis from the day of the written final offer, which is the day of the compulsory conference required by s 292 of the Compensation Act. To reach that point, a worker’s case must be effectively ready for trial. The likely costs of reaching that point, according to Mr Schultz, would have been in the range of $25,000 to $35,000. I accept that evidence which I did not understand to be challenged. Secondly, there was the circumstance that the applicant had remained in the second respondent’s employment. This was a good reason not to bring a claim which, after costs, was likely to be worth less to the applicant than $40,000 and perhaps worth less than $10,000. Of course there was a possibility that his condition would persist. But one matter which must exist for a collection of facts to be material facts of a decisive character is that a reasonable person, with appropriate advice, would regard those facts as showing that an action would have “…a reasonable prospect…of resulting in an award of damages sufficient to justify the bringing of an action”.[3] As at the critical date, on the basis of the medical opinion known to the applicant, the prospect of obtaining such an award was not reasonable.

[20] In February 2009, the applicant gave notice of a proposed claim for damages in the amount of $500,000. According to his oral evidence, he was then advised by his solicitors that his damages would be of that order and it was upon the basis of that advice that this Notice of Claim was given.[4] The respondents seem to rely upon that evidence, together with the giving of the notice of claim itself, in two ways. Firstly, it is said to be inconsistent with the applicant’s case that it was not until September 2009 that he believed that he had a worthwhile case, a submission strongly reliant upon what was said by Keane JA in Castillon v P&O Ports Ltd (No 2).[5] Secondly, it is submitted that there was no material change between the critical date and the giving of the Notice of Claim, thereby indicating that the applicant had a worthwhile case by the critical date.

[24] In Castillon v P&O Ports Ltd, the primary judge had ordered in 2007 that the limitation period be extended to the date upon which the plaintiff had commenced his action in 2003. Part of the basis for this extension was the content of documents which had not been available to the plaintiff by the critical date or indeed by the date of commencement of the action. The plaintiff’s employment by the defendant had been terminated in 2004, i.e. after the commencement of the action. The primary judge regarded that new circumstance, the termination of his employment, as important. In deciding to extend time, the primary judge disagreed with the reasoning of Rackemann DCJ, who had dismissed an earlier application by the plaintiff for an extension. Upon an appeal, the extension was set aside. The principal judgment was given by Keane JA, who wrote:

“[39] That the plaintiff had decided to commence, and actually commenced, proceedings are circumstances which serve to highlight the difficulty involved in the learned primary judge’s conclusion that Rackemann DCJ erred in his crucial finding because he was not aware of the documents lately disclosed by the defendant which show a degree of equivocation on the part of the defendant as to its willingness and ability to continue the plaintiff’s employment. In concluding that Rackemann DCJ erred in his assessment that the plaintiff had the means of knowledge of sufficient facts to justify an action for damages as worthwhile, the learned primary judge seems to have assumed that the recently disclosed information would have led to a reasonable assessment, prior to 27 November 2001, that an action was not worthwhile. That assumption by the learned primary judge is not self-evidently true. It was not supported by analysis demonstrating that the plaintiff’s inability to continue as a crane operator and the defendant’s undisclosed equivocation over its willingness and ability to continue to employ the plaintiff in other duties meant that the economic loss component of an action for damages would reasonably be regarded as insufficient to justify bringing an action.

[40] Her Honour’s assumption is, in truth, counter-intuitive: the facts that the plaintiff had decided in June 2001 to commence an action, and had actually commenced an action before the final termination of his employment, serve to emphasise, at a practical level, the real difficulty in the way of the conclusion that the plaintiff did not know that he had a worthwhile cause of action until his employment was finally terminated. The plaintiff and his legal advisers apparently made an assessment that an action for damages was worthwhile having regard to the facts of which they were aware, including the facts relating to the impairment to the plaintiff’s earning capacity and his vulnerability in the employment market, whether or not the plaintiff continued in employment with the defendant. It may be said that, on an objective view, they were in error in their assessment; but that error is not demonstrated by treating the termination of the plaintiff’s employment as a material fact because, even if it is regarded as a material fact, it was not of a decisive character.”[6]

 

[25] In reliance upon that passage, the respondents argue that the fact that a Notice of Claim was given within the limitation period shows that by then the applicant had decided to commence an action, emphasising “at a practical level, the real difficulty in the way of the conclusion that the plaintiff did not know that he had a worthwhile cause of action”. But care must be taken in adapting what was said in another factual context to the present case, as P Lyons J (with whom Fraser JA agreed) observed about Castillon in Honour v Faminco Mining Services Pty Ltd as Trustee for the Faminco Trust (in liquidation) & Anor.[7] Here, the timing of the Notice of Claim indicates that it was given in a last minute attempt to avoid the expiry of the limitation period, rather than upon a considered assessment that there was a case then worth prosecuting. That impression has support in the applicant’s affidavit evidence which, it may be noted, was prepared by the same solicitors who gave the Notice of Claim. In his affidavit filed on 29 January 2010, the applicant gave this evidence:

“68. In late February 2009, out of an abundance of caution, I gave instructions to my solicitors, Anderssen & Company, to lodge a Notice of Claim for Damages for my Q-fever and psychiatric problems. I was concerned about losing my job if I commenced an action but I wanted to protect my family if I didn’t get better.

69. At that time of late February 2009 I was still of the view that I would fully recover, that being the advice that I had continued to receive from Dr Jones and Dr Beecham.

70. I thought that it would not be worthwhile to follow through a Common Law claim due to my belief that I would fully recover.

113. As a result of receiving news that I have a permanent impairment, I am now concerned that my losses in the future will be considerable.

…”

 

[26] Against that evidence is the applicant’s evidence, in cross-examination, that by February 2009 he had been advised that his “damages were in the vicinity of $500,000” and upon the basis of that advice his Notice of Claim was given. I have some difficulty in accepting that oral evidence. Although the point was not explored in re-examination, I doubt whether the applicant had a proper understanding of what was being put to him. I say that, not only because of the inconsistency of that evidence with his affidavit evidence, but also because of the improbability that by February 2009 he had been advised that he was likely to recover something of the order of $500,000. Ultimately, however, it is unnecessary to resolve this question because the question is not what the applicant then believed or had been advised, but what a reasonable person with appropriate advice would have thought. If there was not a worthwhile cause of action in the relevant sense until September 2009, the applicant’s belief and the content of his legal advice as at February 2009 does not matter.

[27] The applicant requires an extension only until 6 March 2009. It is sufficient for his purposes if he establishes that it was not until after 6 March 2008 that he knew enough about his case to reach a reasonable view, with appropriate advice, that an action would result in an award sufficient to justify it. I have concluded that that was not the case as at the critical date, but that this remained the position a year later and that it was not until September 2009, and the disclosure of medical opinion that his condition was permanent, that he knew of the material facts of a decisive character.

[27] The applicant requires an extension only until 6 March 2009. It is sufficient for his purposes if he establishes that it was not until after 6 March 2008 that he knew enough about his case to reach a reasonable view, with appropriate advice, that an action would result in an award sufficient to justify it. I have concluded that that was not the case as at the critical date, but that this remained the position a year later and that it was not until September 2009, and the disclosure of medical opinion that his condition was permanent, that he knew of the material facts of a decisive character.

Brisbane Barrister – David Cormack

 



[1] [2009] QSC 41 at [24]. 

[2] The Commonwealth v Mewett (1997) 191 CLR 471 at 534 per Gummow and Kirby JJ.  

[3] s 30(1)(b)(i) of the Limitation Act. 

[4] T 1-19 and 1-20. 

[5] [2008] 2 Qd R 219.

[6] Castillon v P&O Ports Ltd (No 2) [2008] 2 Qd R 219.  

[7] [2009] QCA 352 at [91]. 

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