Howley v Principal Healthcare Finance Pty Ltd

Court of Appeal (NSW)|2014-10-30|Before: McColl JA, Meagher JA, Barrett JA

Sea Coatings (Australia) Pty Limited v Pascoe [2008] NSWCA 54 The Salvation Army (South Australia Property Trust) v Rundle [2008] NSWCA 347 Category: Principal judgment Parties: Sarah Howley - Appellant Principal Healthcare Finance Pty Ltd - Respondent Representation: Counsel: L King SC/G Walsh - Appellant D Hooke SC - Respondent Solicitors: CMC Lawyers - Appellant HWL Ebsworth Lawyers - Respondent File Number(s): CA 2014/66795 Publication restriction: No Decision under appeal Citation: Howley v Principal Healthcare Finance Pty Ltd (District Court of New South Wales, 26 February 2014, unrep.) Date of Decision: 2014-02-26 00:00:00 Before: Balla DCJ File Number(s): DC 2013/294581

Judgment 1McCOLL JA: The applicant, Sarah Howley, seeks leave to appeal from a decision of Balla DCJ in which her Honour refused her application for leave pursuant to s 151D of the Workers Compensation Act 1987 (NSW) (the "WCA") to commence workers compensation proceedings against the respondent, Principal Healthcare Finance Pty Ltd, more than three years after being injured while in its employ: Howley v Principal Healthcare Finance Pty Ltd (District Court of New South Wales, 26 February 2014, unrep.) The leave application proceeded as a concurrent hearing so that if leave to appeal is granted, the argument on the application will be taken to be the argument on the appeal. 2For the reasons that follow, I am of the view that leave to appeal should be granted and the appeal should be allowed. I will refer to the applicant as the appellant hereafter.

Factual Background 3The proceedings the appellant sought leave to commence arose out of an incident in which she alleged she was injured whilst in the respondent's employ as a Kitchen General Services Officer. 4The facts supporting the s 151D application appeared in an affidavit sworn on 24 October 2013 by the appellant's solicitor, Mr Brendan Moran ("Moran affidavit"), to which the statement of claim the appellant sought leave to file was annexed. There was no objection to the affidavit. Mr Moran was not cross-examined. What follows is extracted from his affidavit. 5The incident of which the appellant complains occurred on 18 July 2007 at Norah Head Nursing Home in Toukley, where the appellant had been employed for approximately four years. The appellant alleged that she injured her lower back when, in the course of her duties, she was required to lift a crate of bread, then bend over to push it under a bench. She contended that her injury resulted from the respondent's negligence in, inter alia, regularly requiring her to lift heavy items in awkward positions. She identified the claim as one arising from the nature and conditions of her employment as a result of repetitively lifting heavy items. 6The appellant reported the incident to her employer on 23 July 2007. She also sought medical treatment for injuries. 7Mr Moran's affidavit recounted, on information and belief, that the following events transpired prior to him receiving instructions from the appellant. 8The appellant continued to suffer intermittent back pain for the next three years, during which period she continued to work for the respondent. She dealt with the pain by self-medicating with anti-inflammatory medicines. The appellant's lower back pain gradually began to increase in severity from approximately January 2010. She consulted her general practitioner who arranged for CT scans of her lumbosacral spine. On their receipt, he referred her to a specialist spinal surgeon. She saw the spinal surgeon in August 2010. He recommended spinal surgery. He also proffered the opinion that her disc pathology was "a direct cause of her severe lower back pain and appeared to be directly related to her injury at work three years ago": Moran affidavit at 18. 9After receiving this advice, the appellant became concerned that her injuries were more severe than she had previously thought. On 13 September 2010 she contacted her present legal representatives, CMC Lawyers, to enquire whether she had any rights to make a workers compensation claim. On 28 October 2010, she instructed CMC Lawyers to act on her behalf in relation to her injuries. 10Mr Moran's affidavit then set out in some detail the steps he took after his firm was retained to prepare the extension of time application. It is unnecessary to recount most of them as the respondent conceded that there was no relevant delay after Mr Moran's firm was retained. However it is relevant to note that on 15 March 2012 Mr Moran forwarded to the respondent's solicitor a draft pre-filing statement, draft statement of claim and draft list of documents all bearing the date of the letter under cover of which they were forwarded. The letter advised that the appellant made a claim for Work Injury Damages (s 250, Workplace Injury Management and Workers Compensation Act 1998 (NSW) (the "1998 Act")) as particularised in those documents. The final version of these documents was served on 13 March 2013. 11On 11 April 2013 the appellant's solicitors applied to the Registry of the Workers Compensation Commission for mediation of the appellant's work injury damages claim as required by s 318A of the 1998 Act. In support of that application the appellant served WorkCover medical certificates dating back to March 2011, medical evidence, financial evidence, a notification of injury form dated 23 July 2007 and other material relating to her duties in the respondent's employ. 12In response, the respondent's legal representatives served a pre-filing defence to the proposed statement of claim, the appellant's injury claim form of 25 August 2010, a statement of Annette Green dated 19 October 2010, the appellant's supervisor at the time of the incident which led to her injury, and numerous other documents. 13A mediation took place on 26 June 2013 but it was unsuccessful. 14On 30 September 2013 the appellant filed her summons in the District Court, seeking leave to commence court proceedings for damages in respect of her injury against the respondent. As I have said, the application was supported by Mr Moran's affidavit. The respondent did not call any evidence. 15The application was heard on 21 February 2014. In the course of the hearing, the respondent's counsel accepted that the appellant had demonstrated a prima facie case on liability for the purposes of the application. It appears also to have been accepted that the appellant's injury exceeded the 15 cent permanent impairment threshold imposed by s 151H of the WCA for the recovery of damages. The respondent's counsel conceded that the primary judge could not find actual prejudice, but relied on presumptive prejudice by virtue of the date of the accident. His primary point in opposition to the application was that there was no explanation of the delay from the appellant herself. 16Mr Moran swore two further affidavits both dated 20 February 2014. Neither was read on the application, however counsel for the parties agreed that the annexures were before the primary judge. One of those annexures was a document dated 19 October 2010 described in the appellant's written submissions as an "unsigned and incomplete statement of the [appellant] taken by an investigator appointed by the Respondent's workers compensation insurer. 17The other was the statement from Ms Green also dated 19 October 2010 the respondent had served in response to the pre-filing statement. Ms Green said she had been the appellant's supervisor for about five years. She described the practice whereby the baker delivered a crate of bread, leaving it in a position which may entail one of those working in the kitchen to lift it from under the bench and place it upon the bench or vice versa. She also described an incident "[s]ome years ago" when the appellant called out in pain as she went to put a crate under the bench. She said that after that incident "we made a decision in the kitchen that it would become a two person lift".

Legislative framework 18Section 151D of the WCA relevantly provides: "151D Time limit for commencement of court proceedings against employer for damages (1) (Repealed) (2) 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. (3) The Limitation Act 1969 does not apply to or in respect of court proceedings to which this section applies. ..." 19Section 315(1) of the 1998 Act provides: "315 Requirement for pre-filing statement before commencing court proceedings (1) Before a claimant can commence court proceedings for the recovery of work injury damages, the claimant must serve on the defendant a 'pre-filing statement' setting out such particulars of the claim and the evidence that the claimant will rely on to establish or in support of the claim as the Rules may require..." 20Section 151DA(1) of the WCA relevantly provides: "(1) Time does not run for the purposes of section 151D: ... (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..." 21A claimant for work injury damages must refer the claim for mediation under Division 4, Pt 6, Ch 7 of the 1998 Act before the claimant can commence court proceedings for recovery of those work injury damages, but cannot do so until at least 28 days after the pre-filing statement has been served on the defendant under Division 3: s 318A(1), 1998 Act,

Primary Judgment 22The primary judge found that as the appellant was injured on 18 July 2007, proceedings should have been commenced by 18 July 2010. It appears to have been accepted, however, that by virtue of s 151DA(1) of the WCA, the draft pre-filing statement filed on 15 March 2012 operated to stop time running for the purposes of s 151D, even though the final version was not served until 13 March 2013. Accordingly, her Honour found that the appellant's claim was about one year and seven months out of time. 23Next, the primary judge noted that the general question she had to determine in the exercise of the s 151D discretion was "what is fair and just ... [o]r what does the justice of the case require", referring to Ipp AJA's reasons in Itek Graphix Limited v Elliott [2002] NSWCA 104; (2002) 54 NSWLR 207 ("Itek Graphix") (at [87], see below at [45]). (Her Honour referred to this judgment by the media neutral citation "[2001] NSWCA 442", a citation which while it links to a copy of his Honour's judgment appears incorrect as the case was not decided until 11 February 2002 when it was published under cover of the media neutral citation to which I have referred.) 24The primary judge then considered the following matters. 25First, her Honour noted that the respondent conceded that the appellant had shown a prima facie case of liability. 26Secondly, her Honour turned to the issue of delay, which she framed by reference to Itek Graphix (at [89]). After noting the respondent conceded there was no relevant delay after the solicitors were engaged, the primary judge dealt with the explanation for the delay as follows: "The plaintiff did not give evidence. Counsel for the defendant submitted that leave should not be granted because there has been no explanation provided by the plaintiff herself. Counsel for the plaintiff relied on evidence from the solicitor for the plaintiff as providing a sufficient explanation for the period before September 2010. This was set out in an affidavit and the solicitor was not required for cross-examination. The solicitor says that on 18 July 2007 the plaintiff sustained a back injury at work but continued to work with difficulty for three years. From January 2010 the pain gradually began to increase in severity. She sought medical advice and a spinal surgeon recommended an operation at L4/5. The solicitor says that the plaintiff then became concerned that her injury was more serious than she had previously thought and contacted his firm for advice on 13 September 2010. The solicitor then adds that the plaintiff did not seek legal representation before September 2010 as she was seeking treatment in relation to her injuries and disabilities which were of an intermittent variety and which had increased in severity since January 2010. This is the extent of the explanation for the period from the accident in July 2007 up to the retainer of solicitors in September 2010. Counsel for the plaintiff also relied on the histories taken by various doctors as being consistent with the plaintiff having ongoing symptoms for three years and then experiencing an increase in her level of symptoms. In reply counsel for the defendant submitted that a medical history taken in August 2010 of ongoing pain for three years fluctuant in intensity showed that she had had a significant problem over those three years. The plaintiff is required to provide a reasonable explanation for the delay and show that there has not been an absence of diligence on her part. The evidence from the solicitor explains why the plaintiff contacted a solicitor in September 2010. There is no explanation from the plaintiff as to why she did not consult one earlier. Even if it would be sufficient for the plaintiff to rely on an explanation from her solicitor (which I do not accept) I am not persuaded that the level of her symptoms over that period is sufficient. I am accordingly not persuaded that I could make any finding in relation to whether she has a reasonable explanation or whether she exercised diligence on the evidence before me. Accordingly I find that the plaintiff has not provided a reasonable explanation for the delay and not shown that there has not been an absence of diligence on her part." 27The primary judge then turned to the issue of prejudice as follows: "In Holt v Wynter [2000] NSWCA 143 at [119] - [120] the Court held: 'In my opinion, the effect of the decision of the High Court in Brisbane South Regional Health Authority is that an application for an extension of time under limitation legislation should be refused if the effect of granting the extension would result in significant prejudice to the potential defendant.' (cited with approval in Gallagher Bassett Services NSW Pty Ltd v Murdock [2013] NSWCA 386 at [27]). The defendant did not call any evidence. Counsel for the plaintiff submitted that there was no evidence of any prejudice to the defendant - the plaintiff had notified the defendant of her injury on 23 July 2007, on 19 October 2010 the defendant had obtained a statement from the plaintiff's supervisor who had recalled the plaintiff complaining of having sustained a back injury so that the system of work had been subsequently changed and the examination of the plaintiff by a neurosurgeon at the request of the workers compensation insurer on 25 October 2010. Counsel for the defendant conceded there was no evidence of actual prejudice. He did submit that the evidence showed there had been some investigation of the claim of a frank injury on 18 July 2007 but no evidence of the defendant having investigated the claim made by the plaintiff in the Pre Filing Statement and the Statement of Claim that the injury had been caused by the nature and conditions of the plaintiff's employment. The accident occurred 6½ years ago. I accept the submission made by counsel for the defendant that there is presumptive prejudice flowing from the delay which I take into account." 28Taking into account all these matters, the primary judge then refused to give leave to extend the limitation period and ordered the appellant to pay the respondent's costs.

Issues on Appeal 29The appellant raises the following grounds of appeal: (1)Her Honour erred in holding that there was no explanation for the appellant's delay in seeking legal advice between the date of injury of 18 July 2007 and her consulting her solicitor on 13 September 2010. (2)Her Honour erred in her consideration of the explanation for the delay by adopting the view that it was for the appellant to explain the relevant period personally upon her own affidavit rather than rely on her solicitor's affidavit. (3)Her Honour erred in holding (by implication) that a fair trial was not possible by reason of forensic prejudice, of an apparent "presumptive" kind, to the respondent. (4)Her Honour erred in failing to give reasons indicating what the relevant prejudice probably was and how it would operate.

Appellant's submissions 30The appellant first submitted that she had discharged the onus she bore to secure an extension of time in that she had established that a fair, albeit not perfect, trial could be had in the sense that there was no significant forensic prejudice to the respondent, that the proceedings would not be futile as there was a prima facie or arguable case on liability and that she had adequately explained the delay. 31Secondly, the appellant submitted that the primary judge had erred in rejecting the explanation for delay apparently because her Honour proceeded on the basis that the appellant was required to support her application by her own affidavit. She argued that as the s 151D application was interlocutory, hearsay evidence in the form of Mr Moran's affidavit was permissible provided, as was the case, its source was demonstrated: s 75, Evidence Act 1995 (NSW). She complained that the primary judge had failed to take into consideration the explanation for the delay set out in Mr Moran's affidavit. 32Thirdly, the appellant submitted that the only relevant delay was explained by the fact that she was able to carry on work, relying on over the counter medication until the gradual progression of her condition took her to the point where surgery was required. She contended this was explained by her medical evidence and was accepted by a neurosurgeon qualified by the respondent, Dr Blum. 33Fourthly, the appellant submitted that the delay should also be understood in the context that until her condition deteriorated she had not suffered actual economic loss. If she had consulted a solicitor before her condition deteriorated she would likely have been advised that she could not satisfy the s 151H, WCA threshold to claim damages. 34Fifthly, the appellant submitted the primary judge's statement that there was disqualifying "presumptive prejudice", did not specify how such prejudice meant there could not be a fair trial. She contended that there was no indication (apart from the primary judge's reference to the six and a half years since the date she was injured) as to how that lapse of time could in reality cause prejudice. She argued that the respondent had investigated the incident, had been monitoring and paying for her treatment and that both sides had served extensive medical evidence. 35Accordingly, the appellant argued the primary judge's exercise of discretion miscarried upon the basis that she made errors of fact as to lack of explanation and prejudice, and made an error of law as to the need for an affidavit from the appellant herself, or at least in that regard, gave excessive weight to the absence of such an affidavit when the appellant's explanation was in evidence in permissible form.

Respondent's submissions 36The respondent submitted that the primary judge had not misdirected herself insofar as the absence of an affidavit from the appellant was concerned. Rather it argued that her Honour permissibly gave less weight to the hearsay evidence from Mr Moran than would have been the case if the appellant had given evidence herself which could have been tested in cross-examination. 37The respondent noted that pursuant to s 151D of the WCA the limitation period expired at least by 18 July 2010. It pointed out that until the appellant's statement of claim in which she alleged that her injury arose from the nature and condition of her work had been propounded, her case had been one of a frank injury. It contended that on the case pleaded, that the appellant's injury was caused by her being required to lift heavy items regularly and repetitively in her employment, which commenced in February 2004, the limitation period might arguably have expired earlier. It argued that the primary judge was being asked to grant leave to proceed more than 6½ years after the latest date on which the injury could have been suffered and more than 3½ years after the expiration of the limitation period and 10 years and 7 years respectively after the allegedly tortious employment began. 38Secondly, the respondent contended that the primary judge had not rejected the appellant's explanation for delay on the basis she had not given evidence. Rather, it submitted the primary judge was entitled to treat the explanation proffered through Mr Moran's affidavit with caution and to accord it weight accordingly, having regard to the fact that the appellant did not proffer herself for cross-examination. Accordingly, the respondent argued her Honour had, and was entitled to, rejected the explanation proffered through Mr Moran's affidavit as sparing. The respondent also contended that objective evidence cast doubt on Mr Moran's instructions, referring to a report from a Dr Suri, the appellant's general practitioner, to the effect that the appellant had consulted him on 28 July 2008 after injuring her back at work, but had also said "[h]er back complaint goes back to 18.10.2000 as you can see from the enclosed documents". The enclosures were not in evidence. 39The respondent also contended that the appellant's draft statement was inconsistent with the account Mr Moran recorded insofar as it suggested her back was "very bad" at the time she saw Dr Suri in 2008, whereas the account in Mr Moran's affidavit was to the effect that she had intermittent symptoms until 2010 when her pain began to increase severely. Accordingly the respondent submitted her Honour was entitled to have little regard to the explanation in Mr Moran's affidavit. 40Thirdly, the respondent submitted that these matters were relevant to the issue of presumptive prejudice. It emphasised McHugh J's discussion of the concept of presumptive prejudice in Brisbane South Regional Health Authority v Taylor ("Brisbane South") [1996] HCA 25; (1996)186 CLR 541 (at 551) (see below (at [47]). 41Fourthly, the respondent submitted that it was unnecessary for her Honour to spell out aspects of the case affected by presumptive prejudice. However, it submitted such prejudice could be found, albeit not exclusively so, in the differences between the frank injury and nature and condition cases, the undisclosed history of back pain as evidenced by Dr Suri's report and the inconsistencies between the instructions the appellant gave to Mr Moran, Dr Suri's report and the appellant's statement to the investigator. 42Accordingly, the respondent submitted that the appellant had not demonstrated that the primary judge erred in a manner which attracted appellate intervention.

Consideration 43A decision to grant or refuse an extension of time for the commencement of the proceedings is an interlocutory decision from which leave to appeal is necessary, such leave being given, among other reasons, where there are substantial reasons to allow an appellate review, such as where there is an error of principle which, if uncorrected, will result in substantial injustice: Dagg v Davis [2013] NSWCA 203; (2013) 64 MVR 240 (at [13]) per Ward JA (Barrett JA and Sackville AJA agreeing). 44Section 151D(2) does not spell out specific criteria to be taken into account by the court when exercising the discretion to extend the time to commence court proceedings sought to be commenced more than 3 years after the injury was received: cf s 58(2), 60C(2) Limitation Act 1969 (NSW); s 109 Motor Accidents Compensation Act 1999 (NSW). 45Rather, as Ipp AJA (Spigelman CJ and Sheller JA agreeing) explained in Itek Graphix (at [87]), in the passage to which the primary judge referred, s 151D confers a broad discretion to grant leave to sue after expiry of the limitation period, in which context "the general question that has to be asked is what is fair and just ... [or] what does the justice of the case require?"; see also Sheller JA (at [2]). 46The "justice of the case must be evaluated by reference to the rationales of the limitation period that has barred the action" (Itek Graphix (at [87]), including those to which McHugh J referred in Brisbane South (at 552 - 553)), they being that as time goes by relevant evidence is likely to be lost; that it is oppressive to a defendant to allow an action to be brought long after the circumstances that gave rise to it have passed; the desirability for people in the community to be able to arrange their affairs and utilise their resources on the basis that claims can no longer be made against them and the fact that the public interest requires that disputes be settled as quickly as possible. 47McHugh J's rationales are those which underpin the notion of presumptive prejudice, a "prejudice [which] may exist without the parties or anybody else realising that it exists ... where important, perhaps decisive, evidence has disappeared without anybody now 'knowing' that it ever existed [where] ... time ... diminish[es] the significance of a known fact or circumstance because its relationship to the cause of action is no longer as apparent as it was when the cause of action arose": Brisbane South (at 551). 48The effect of Brisbane South "is that an application for an extension of time under limitation legislation should be refused if the effect of granting the extension would result in significant prejudice to the potential defendant": Holt v Wynter [2000] NSWCA 143; (2000) 49 NSWLR 128 (at [119]) per Sheller JA (Meagher and Handley JJA and Brownie AJA agreeing). "Significant prejudice means such prejudice as would make the chances of a fair trial unlikely": The Salvation Army (South Australia Property Trust) v Rundle [2008] NSWCA 347 (at [96]). 49In Itek Graphix following the passage to which the primary judge referred, Ipp AJA continued: "88. I have pointed out that the justice of the case is to be determined by its own individual circumstances. Often, a failure satisfactorily to explain the delay will not be decisive. Ordinarily, the issue of prejudice will be of paramount importance: Nowlan v Marson Transport Pty Ltd [2001] NSWCA 346 at [34] - [36]; Malone v New South Wales National Parks and Wildlife Service [2001] NSWCA 345 at [9]. Nevertheless, the justice of the case may be such that the failure to explain the delay and to prosecute the case with the requisite diligence will result in an extension of time being refused. 89. The rule that an applicant, who applies for leave to bring proceedings after a limitation period has expired, must provide a reasonable explanation for the delay (and show that there has not been an absence of diligence on his or her part) forms part of limitation legislation throughout the country and, independently, has long been recognised by the courts ... 90. The reason for this requirement is not hard to understand. A limitation provision is an expression of intent by Parliament that persons who wish to sue must do so within the stipulated time unless circumstances exist entitling them to obtain leave. A limitation provision is the general rule and an extension is the exception. In obtaining leave, a party is in effect obtaining an indulgence. To allow parties leave, when they have been careless of their rights and careless of the need to proceed with their disputes within the limitation period, would, ordinarily, be contrary to the justice of the case and would subvert the intent of Parliament. Just as the rules of court must prima facie be obeyed (Ratnam v Cumarasamy [1965] 1 WLR 8 at 12), so must the laws of Parliament." [I note that her Honour also referred to [89], see [26] above.] 50It should be borne in mind, as Whealy JA (Hodgson and McColl JJA agreeing) explained in Nominal Defendant v Harris [2011] NSWCA 70; (2011) 57 MVR 492 (at [45]), that Ipp JA's comments "were intended to provide useful and cautionary guidance as to the way a court exercising a broad statutory discretion to extend a limitation period will ordinarily respond [but] do not ... supplant the language of the statute [nor] ... override the broad discretionary exercise entrusted to a court to take into account all the relevant circumstances in determining what is fair and just." 51Where an extension of time is sought to extend time to bring proceedings pursuant to s 151D(2), "it is for the person seeking to be freed from the constraint imposed by the limitation statute to show that the relevant delay is not likely to make the proceedings unfair or to cause real prejudice to the proposed defendant, that is, the person having the benefit of the time bar": Gallagher Bassett Services NSW Pty Limited v Murdock [2013] NSWCA 386; (2013) 86 NSWLR 13 (at [26]) per Barrett JA (Gleeson and Leeming JJA agreeing); see also Brisbane South (at 550) per Toohey and Gummow JJ; Sea Coatings (Australia) Pty Limited v Pascoe [2008] NSWCA 54 (at [27]) per Handley AJA (Hodgson and Tobias JJA agreeing) ("Sea Coatings"). 52Factors contributing to the justice of this case included the respondent's concession that the appellant had a prima facie case on liability. It would be otherwise if she had had a weak case, as "the apparent weakness of the plaintiff's case is a factor which militates against an extension of time": Commonwealth of Australia v Shaw [2006] NSWCA 209; 66 NSWLR 325 (at [40], [83]) per Basten JA (Handley and Ipp JJA agreeing), referred to with approval in Sea Coatings (at [51]).

Adequacy of the explanation 53The primary judge did not accept that the appellant could rely upon evidence from her solicitor explaining why she contacted her solicitor when she did. She did not say why, even though she recorded that Mr Moran had not been required for cross-examination. 54An applicant for relief pursuant to s 151D(2) should ordinarily lead evidence "appropriate to give the Court a satisfactory understanding of why it was that proceedings were not commenced in time.": ASB-Tech Services Pty Ltd (In Liq) v Doeland [2003] NSWCA 167 ("Doeland") (at [30]) per Hodgson JA (Handley JA and Cripps AJA agreeing). 55However, the statement in Doeland does not mean the applicant must personally give such evidence. As the appellant submits, Mr Moran's evidence was admissible pursuant to s 75 of the Evidence Act. Accordingly the hearsay rule did not apply, and the appellant's statements recited by Mr Moran were admissible "to prove the existence of a fact that it can reasonably be supposed that the person intended to assert by the representation": see s 59(1), Evidence Act. Provided the relevant requirements of the legislation were satisfied by the evidence, the source of that evidence was irrelevant so long as it was otherwise admissible on an interlocutory application of the kind in question: Richard Crookes Constructions Pty Ltd v Kozul [2005] NSWCA 312 ("Kozul") (at [21]) per Tobias JA (with whom Young CJ in Eq and Hunt AJA agreed) explaining Doeland; see also (at [41]) per Young CJ in Eq. Kozul concerned an application for an extension of time pursuant to s 60C(2) Limitation Act 1969 (NSW), however in my view their Honours' observations have equal application in the present context. Further, the fact that the evidence was hearsay did not permit "the primary judge to do other than address it on its terms as reasonably understood": Brierley v Ellis [2014] NSWCA 230; (2014) 67 MVR 282 (at [28]) per Meagher JA (Basten and Gleeson JJA agreeing). 56While appearing to reject the explanation proffered through Mr Moran, the primary judge nevertheless appeared to criticise it on the basis that there was no explanation why the appellant did not consult a solicitor prior to September 2010. She also rejected it because she was "not persuaded that the level of her symptoms over that period is sufficient". That bald statement does not demonstrate any reasoned analysis of the explanation. 57There was nothing inherently incredible in the appellant's explanation of the deterioration in her condition which led her to consult a surgeon. It was supported by the medical evidence to which Mr Moran referred. It may be that there was a report which was open to the interpretation that the appellant had suffered ongoing pain over three years prior to 2010. However the nub of the appellant's explanation was that she had managed to continue to work despite pain (for which she had medicated) and it was not until 2010 that there was a sharp deterioration leading to the advice to submit to surgery as the appellant in due course did. The primary judge failed to give that evidence any proper consideration and, in this respect, in my view fell into error. 58Further, the primary judge failed to take into account Ipp JA's statement in Itek Graphix (at [88]) that a failure to give a satisfactory explanation will often not be decisive and that ordinarily the issue of prejudice will be paramount. As Hodgson JA explained in Doeland (at [34]), the question of an explanation is not a discrete one. Rather: "[36] ... the test to be applied is whether it is fair and just that an extension be granted, and the strength of the explanation and the degree of presumptive and actual prejudice are matters to be taken into account, together, in coming to a conclusion on this question. Where the prejudice is such that a fair trial is unlikely, it will as a general rule not be fair and just to grant the extension. However, where there is prejudice falling short of this, that prejudice will still weigh in the assessment, and is a matter to be considered along with the adequacy of the explanation in making the ultimate determination."

Prejudice 59In circumstances where the respondent did not contend there was any actual prejudice, the question remained whether the delay was likely to make the proceedings unfair. Accepting that presumptive prejudice can involve the unknown existence of lost evidence as McHugh J explained in Brisbane South (at 551) will not militate against evaluating that prejudice in the light of what is known. The primary judge made no attempt to analyse whether, in all the circumstances, a fair trial was possible and, in that respect, in my view also erred.

Conclusion 60In my view the appellant has established that the primary judge's exercise of discretion miscarried. This Court should re-exercise the discretion. I would do so in the appellant's favour for the following reasons. 61First, the appellant's explanation for delay as recounted in Mr Moran's first affidavit and as supported in her draft statement, while sparing was sufficient. The appellant's case was straightforward. There was little more that could be said than that she had tried to stay at work despite continuing back pain for which she had self-medicated until it became so unbearable that she sought specialist assistance. It was hardly surprising that the advice that she required spinal surgery and that her condition was caused by the incident at work in 2007 led to her seeking legal advice. It did not require cross-examination of the appellant, nor an express statement on her part, to infer that she did not turn her mind to seeking legal advice until the seriousness of her injury became manifest in 2010. 62Secondly, as to two of the matters of presumptive prejudice the respondent raises, (see [38] - [40] above) the appellant emphasises that neither was raised before the primary judge. Neither in my view readily falls within the concept of presumptive prejudice. The matter concerning Dr Suri's report could have been explored by the respondent issuing a subpoena to produce the enclosures referred to in Mr Moran's affidavit. That can take place at any trial at which, of course, Dr Suri can be called to explore the aetiology of the appellant's back complaint. 63Thirdly, it is difficult to reconcile the respondent's attempt to invoke under the rubric of presumptive prejudice the fact that the appellant's claim in the proposed statement of claim is cast as one arising from the nature and condition of her employment with its concession that the appellant has a prima facie case on liability - a concession from which it did not resile on appeal. 64It is apparent from Ms Green's statement at least that a witness is available who can give evidence both about the system in place prior to 18 July 2007 of which the appellant seeks to complain concerning the positioning of the baker's crate. Ms Green also appears to have observed the circumstances in which the appellant ultimately suffered the acute injury which founds her current claim. It is no doubt at least because Ms Green could give such evidence that the respondent conceded on the application it could not point to actual prejudice. Again it is difficult in the circumstances to see how it could contend that the nature and condition claim gives rise to presumptive prejudice. 65In my view, taking into account the four rationales to which McHugh J referred in Brisbane South, the appellant established that a fair trial could take place. Having regard to the justice of the case, in my view granting an extension of time would not result in significant prejudice to the respondent.

Orders 66Accordingly, in my view the appeal should be allowed and the primary judge's decision should be set aside. The costs of the extension application should be the appellant's costs in the proceedings commenced pursuant to such leave: see Nowlan v Marson Transport Pty Ltd [2001] NSWCA 346; (2001) 53 NSWLR 116 (at [37]) per Heydon JA (as his Honour then was). I propose the following orders: (1)Grant leave to appeal. (2)Appellant to file a notice of appeal in the form of the draft in the White Book within seven (7) days of delivery of these reasons. (3)Appeal allowed. (4)Order of Balla DCJ of 26 February 2014 dismissing the appellant's application for leave pursuant to s 151D of the Workers Compensation Act 1987 (NSW) to commence proceedings against the respondent set aside. (5)In lieu thereof, order that the appellant have leave to commence proceedings in the District Court against the respondent claiming damages in respect of her injury of 18 July 2007. (6)Costs of the extension application at first instance to be the appellant's costs in the proceedings commenced pursuant to such leave. (7)Respondent to pay the costs of the application for leave to appeal and of the appeal and to have a certificate under the Suitors' Fund Act 1951 (NSW) if otherwise qualified. 67MEAGHER JA: I agree with McColl JA. 68BARRETT JA: I agree with McColl JA.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 18 December 2014

Suitors' Fund Act 1951(NSW)

At a glance

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Judgment (14 paragraphs)

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Legislation Cited (6)

Cases Cited (22)

Cited By (30)