Kazic v GIO Workers Compensation

District Court of NSW|2007-08-17|Before: Mr J, Mr P

Introduction

Mr Kazic was injured in the course of his employment as a gyprock fixer on 23 February 2002 at a Sydney building site, when he was struck on the head by a piece of scaffolding, causing him to fall to the ground. He claimed that his injury was caused by the negligence of several companies involved in the construction work being carried out, namely the scaffolding companies on site, the head contractor, and his employer, Capitol Construction Group Pty Ltd. His employer is now in liquidation. In its place he sued its workers' compensation insurer.

All the defendants denied liability for Mr Kazic's injuries. In the alternative, contributory negligence on the part of Mr Kazic was alleged. There were cross-claims between some defendants seeking contribution in respect of the damages to be awarded. Those damages, and the contributions as between defendants, required adjustment under s 151Z of the Workers Compensation Act 1987 (NSW).

The first issue for determination was how the accident occurred, and the identity of the employer of the scaffolder who caused the piece of scaffolding to strike Mr Kazic on the head.

The second issue was whether either of the companies involved in dismantling the scaffolding on the building site, Waco Kwikform and Eastside Scaffolding, was negligent as to the manner in which the dismantling work was being carried out.

The third issue was whether the head contractor, John Holland Pty Ltd, was negligent in its management of the building site or the coordination of the work being undertaken by the various subcontractors and their employees.

The fourth issue was whether Mr Kazic's employer was in breach of the non-delegable duty of care it owed to him.

The fifth issue was whether Mr Kazic failed to take reasonable care for his own safety, such that his damages should be reduced for contributory negligence.

The final issue to be determined was the apportionment of responsibility for Mr Kazic's injuries as between those defendants found to be liable.

How did the accident occur? 10. At the time of the accident, various people were engaged in tasks on the 10th floor including electricians, air-conditioning people, gyprock fixers and scaffolders. A team of four gyprock fixers, supplied by Capitol Constructions, was enclosing vertical shafts at the corners of the building with gyprock sheets. This team included Mr Kazic and his brother, Huska Kazic, working on a shaft at one corner, and Mr Krasnic and Mr Husic, working on a shaft at another corner. Nearby, there was a team of scaffolders engaged in moving dismantled scaffolding components. Scaffolding that had been erected on the outside of the building had been dismantled into its various components and stacked on the outside of the building. These components were of various different shapes and sizes, including round steel piping or tubes, flat planks or beams, and welded mesh fence panels known as Jetmesh. There were scaffolders on the outside passing these components through an open window space to another scaffolder, who was stacking them on the inside of the building, preparatory to transportation down the lift and out of the building. The smaller components were stacked in a rack (T 84.21-26, 88.8-10), or on the floor (T 65.44). The longer components, such as the planks and piping, were being leaned up against the wall (T 65.44, 88.17-21).

The scaffolders were not identified, but were wearing orange T-shirts (T 65.32). The one on the inside, receiving the components and stacking them, was described as young and tall, having long hair in a ponytail and bearing a resemblance to Bob Marley.

In the course of the process of stacking the scaffold components inside the building, one of the components struck Mr Kazic on the side of the head as he was leaning down to pick up a tool from the floor. The work was being done somewhat hurriedly (T 65.49, 87.56-58).

The only eyewitness to the accident was Mr Krasnic. Mr Kazic's brother noticed something falling out of the corner of his eye, and in my view could only have formed an impression of what occurred. Mr Krasnic, on the other hand, directly observed the incident in its entirety. He impressed me as a reliable witness who was not deflected in cross-examination from the clear description he provided, albeit the evidence was given through an interpreter (T 88.47ff):

Q. Could you tell us what you saw happen to Mr Kazic? A. At that point in time I was with my partner being busy with our tasks and every now and then we just stop and chat, it's part of the job we're doing. Nearby there was a pile of material that we were using and we were just happen to be discussing part of our tasks that were lying ahead of us. Two of these guys that were bringing in these parts of the scaffolding, one of them was younger and skinnier, he was pretty tall with the long hair, he had a pony tail, his hair, and the other guy who was passing these metal pipes was chubbier, stronger person. From where he was standing he was chucking them on that pile that was actually leaning against the wall with the other metal pipes. Then I saw for some reason Mr Kazic was bent forward, probably he was doing something on the floor. Then I saw that guy throwing that metal plank against the wall. It bounced and hit Mr Kazic and hitting Mr Kazic (witness indicates).

Q. Could you indicate again for his Honour where you say the plank hit? A. He was bent forward, that is Mr Kazic, then when the plank came, bounced and hit him (as indicating).

There was conflicting evidence about whether the component that hit Mr Kazic was flat or round, and whether it was thrown against the wall and bounced off it or was pushed up against the wall and then fell. It seemed unimportant to me. What mattered was that a long piece of scaffolding that the scaffolder with the ponytail was attempting to stack against the wall fell, bounced, and struck Mr Kazic in the head as he was leaning over to retrieve a tool from the floor. I find that the long piece of scaffold that struck Mr Kazic was either a tube or a beam, more probably a tube, but was not a welded mesh fence panel, that is, it was not Jetmesh (T 97.56-8). I am satisfied that the conduct of the scaffolders involved a lack of reasonable care and was negligent. I am further satisfied that the system of stacking was unsafe, or at least that it was being performed in an unsafe manner, having regard to the inherent risk of the scaffold components falling or being dislodged from against the wall, and the undue haste and lack of care being exercised. The evidence also establishes that this system, and the haste involved, had been occurring for some time and this was known to, or should have been known to those in authority and responsible for the various workers on site.

The questions that then arise are: firstly, who was the employer of the scaffolders involved, and was it one of the defendants; and second, were any of the defendants responsible for allowing the work to be done in such an unsafe way.

Who employed the scaffolders? 16. For the reasons set out above, I find that the manner in which the task of moving the dismantled scaffold components inside the building and stacking them against the wall involved a foreseeable risk of injury and was unsafe, and as a result Mr Kazic was injured. The scaffolder with the ponytail was guilty of a casual act of negligence directly responsible for the injuries suffered by Mr Kazic. It is necessary, therefore, to determine the identity of the employer of the scaffolders.

It was contended that it was not proven that Eastside Scaffolding was the employer of the negligent scaffolders. Counsel for Eastside Scaffolding submitted there was no direct evidence as to who their employer was, but that no inference could be drawn that Eastside Scaffolding was the employer. Rather, there was evidence that it was not the employer. It was further suggested that it was possible that the employer was some other company on site with a role in scaffolding work, including John Holland, Waco Kwikform, Cardinal, Cradle Runways, Granitex, Enviro Acoustics, AGP or R & K Donnelley (para 5 of the written submissions). In particular, the written subcontract with R & K Donnelley was in precisely the same terms as that of Eastside Scaffolding (para 2). This evidence should be preferred over the oral evidence of Mr Damiani, the Operations Manager at Waco Kwikform responsible for the execution of the subcontract relating to this building site, whose evidence was unreliable (para 3). Further, there was conflicting evidence as to the number of scaffolders involved and what they were wearing (para 8). Nor can it be ruled out that there were workers involved from other companies who were "mixing" trades (para 9).

I found Mr Damiani to be an impressive witness. He gave his evidence in a precise, succinct way, and there was nothing to indicate a bias, or any tendency to prevaricate. His recollection was clear and there was nothing about him or his evidence that indicated his version of events was unreliable. I prefer the oral evidence of Mr Damiani as to what actually happened over any inferences that might be drawn from the contract, which has every appearance of being a form document, not necessarily reflective of the actuality. I am satisfied that in respect of its subcontract to provide the scaffolding for this site, Waco Kwikform only provided scaffold components, and did not provide its own labour, but hired labour from Eastside Scaffolding to carry out the dismantling and removal of the scaffolding (T 151.13-41, 152.56).

The evidence establishes that employees from Eastside Scaffolding were working on the site that day (Ex 2D3 at Tab 15.3). In my view the evidence as to the clothing worn by the scaffolders and the number of men involved is equivocal. There being no direct evidence of employees of other companies having been involved in the dismantling and removal of the scaffolding on that day, in my view the only inference that can be drawn is that the scaffolders involved were from Eastside Scaffolding. It was open to Eastside Scaffolding to call positive evidence to contradict that inference, but it did not.

For these reasons I find on the balance of probabilities that Eastside Scaffolding was not only responsible for the unsafe system employed by the scaffolders for moving and stacking the components inside the building, or at least the unsafe manner in which it was being executed, but was also their employer, and as such vicariously liable for their negligence. Eastside Scaffolding is, therefore, liable to Mr Kazic for the injuries he received when struck by the scaffolding component.

Was Waco Kwikform negligent? 21. It was submitted for Waco Kwikform that it was not negligent. There was nothing it did that caused the accident and nothing not done that would have avoided it. There was no opportunity to intervene. It was entitled to expect and assume that as skilled employees, the scaffolders from Eastside Scaffolding would go about the dismantling work in a reasonable and careful way. There was no evidence that Waco Kwikform was aware the scaffold components were being thrown against the wall (para 49), and in any event was not required to act as a nursemaid to experienced tradesmen (para 50), and it was not its role to dictate the system to be employed for the task (para 58).

These submissions, however, run contrary to the evidence of Mr Damiani. It is clear Waco Kwikform retained a supervisory role in relation to the dismantling and removal of the scaffolding (T 163.44, 168.47). It is equally clear that it was aware of the system being employed (T 165.28ff, 168.54ff). Having regard to this evidence, and the opinion of the expert (Ex A at 7.6 on p 12), I am satisfied that Waco Kwikform failed to take appropriate steps to prevent or minimise the foreseeable risk of injury, and was in breach of its duty of care to other workers on the site, thus contributing to the injuries sustained by Mr Kazic.

Was John Holland Pty Ltd negligent? 23. Similar submissions were made on behalf of the head contractor, John Holland. There was no deficiency in the system (para 52) and the events happened so quickly that there was no opportunity for intervention (para 45).

The head contractor, as occupier of the building site and responsible for the coordination of all the interdependent activities being carried out on the site, remains ultimately accountable for ensuring that the systems and the manner of their exercise are reasonably safe and not carried out in a way that creates a risk of foreseeable injury.

The evidence establishes that John Holland supervisors were present from time to time when the removal of the dismantled scaffold components was occurring, including the stacking of components against the wall. I am satisfied that John Holland was either aware, or should have been aware of the unsafe means employed to stack the scaffold components, creating a risk of foreseeable injury. I find, therefore, that John Holland was also in breach of its of care to workers on the site, thus contributing to the injuries sustained by Mr Kazic.

Was Mr Kazic's employer negligent? 26. It was submitted for the employer, by counsel for its insurer, GIO Workers Compensation (NSW) Ltd, that although it owed a non-delegable duty of care to Mr Kazic, "the moot point in this truism is what the employer should and could have done to meet that duty of care" (page 7). It was submitted that the spontaneous act of the scaffolder at or near the commencement of the days work was not something that could reasonably have been prevented.

I am satisfied, however, that having regard to the evidence that the practice of stacking scaffolding components against the wall had been going on unchecked for some time, the employer must also take some responsibility for the accident.

Was Mr Kazic guilty of contributory negligence? 28. It was not alleged that Mr Kazic was not wearing his hard hat. The allegations of contributory negligence revolved around a failure on his part to keep a proper lookout, and placing himself in a position of danger having regard to the activities of the scaffolders in the nearby vicinity, in particular the stacking of scaffolding against the wall.

It was for the defendants to satisfy me that Mr Kazic contributed to his injury by failing to take the reasonable care for his own safety that is to be expected of a reasonable person in his circumstances. In the employment context it is recognised that in considering contributory negligence it is open to the tribunal of fact to have regard to "inattention bred of familiarity and repetition, the urgency of the task, the man's preoccupation with the matter in hand, and other prevailing conditions" (per Windeyer J in Sungravure Pty Ltd v Meani (1964) 110 CLR 24 at 37): Sheldrick v State of New South Wales [2007] NSWCA 105 at 53.

In my view what occurred was not reasonably foreseeable to a person in Mr Kazic's circumstances. He cannot be said to have failed to keep a proper lookout. He was in the act of bending over to pick up a tool. It was not reasonable to expect that he should have foreseen that a piece of scaffolding would be thrown up against the wall, then bounce some distance in his direction and strike him.

For these reasons I find that Mr Kazic did not fail to take reasonable care for his own safety.

How should liability be apportioned between the negligent defendants? 32. Various submissions were made as to the apportionment of responsibility as between the various defendants. These reflected, naturally, the duty of counsel making them to minimise their client's exposure, and in the case of Mr Kazic, to minimise the adverse impact wrought on plaintiffs by s 151Z of the Workers Compensation Act 1987 (NSW).

I approach the task of apportioning responsibility between the defendants liable to Mr Kazic having regard to the following principles. It is not necessary to show that the precise event that resulted in the injury was foreseeable: Caledonian Collieries Ltd v Speirs [1957] HCA 14 at [12]. It is only necessary to consider whether it was reasonable to foresee in a general way the kind of thing that occurred: Thomson v Bankstown Corporation (1953) 87 CLR 619 at 630. And the absence of past mishaps does not entitle a defendant to ignore safeguards against dangers: Romeo v Conservation Commission of the Northern Territory [1998] HCA 5 at [128].

Apportionment is to be approached not as a question of principle, or of positive findings of fact or law, but as a matter of proportion, of weighing considerations, of balance and relative emphasis. It involves an individual choice or discretion, as to which there may well be differences of opinion by different minds: Liftronic Pty Limited v Unver [2001] HCA 24 at [2].

It is clear, in this case, that the major part of responsibility for the accident is to be visited upon the scaffolders who were directly responsible for Mr Kazic's injuries, and therefore upon their employer, Eastside Scaffolding. In my view, that company should bear 75% of the responsibility.

More problematic is the division of the remaining 25% of responsibility amongst the other defendants.

In my view, having regard to matters of proportion, balance and relative emphasis, the employer and the head contractor should be required to bear minimal responsibility. Wako Kwikform, on the other hand, was more directly involved, having regard to its overall responsibility for the dismantling of the scaffolding, and the role required of Mr Damiani to ensure the work was done safely. I therefore apportion 15% responsibility to Wako Kwikform and 5% to each of John Holland and the Capitol Construction Group.

For these reasons I find that it is just and equitable that the contribution of the respective defendants should be as follows:

GIO Workers Compensation (NSW) Ltd (First defendant) 5% John Holland Pty Ltd (Second defendant) 5% Waco Kwikform Pty Ltd (Third defendant) 15% Eastside Scaffolding & Rigging Pty Ltd (In liq) (Fourth defendant) 75% 100% Damages 39. I turn to the assessment of damages. Mr Kazic was born on 29 March 1967 and is now 40. At the time of his accident in 2002 he was 34. In addition to the head injury suffered in the accident, he alleges that he suffered other injuries to his neck, back, right shoulder and left leg, together with a psychological condition developed as a consequence of the injuries and their effect on him. Following the accident he went back to work after 7-10 days, but on restricted duties, as a supervisor, but with continuing headaches and persisting pain through his upper body, and subsequently in his lower back. He said that the pain and discomfort became increasingly severe until he was unable to cope any longer, and after 8 months, on 30 October 2002, he stopped working.

Apart from a short period in March 2004 when he unsuccessfully attempted to work at Lowes for a few weeks, he has not worked since October 2002. Throughout this time he has been paid weekly workers compensation on the basis of total incapacity. His case is that he will never work be able to work again.

He claims damages for out-of-pocket expenses, past wages lost, future medical expenses, future economic loss, the cost of future domestic assistance, and non-economic loss.

There is a wide gulf between the claim made by Mr Kazic, and the medical evidence supporting it, and the case for the defendants. It was submitted for the John Holland and Wako Kwikform, for example that his relevant injury was the cut to his left forehead, and nothing more. All his other problems, assuming they are genuine, have nothing to do with the accident. In this regard, the defendants say that there is no neurological evidence of any ongoing head injury, that any orthopaedic consequences of the accident were limited to soft tissue injuries that have resolved, and that any psychological condition from which he may be suffering cannot be attributed to the accident.

The injury to the head 43. Apart from initial concussion, not involving any loss of consciousness, but productive of headaches and dizziness, the only other head injury suffered by Mr Kazic, was the laceration to the side of the head, which was sutured and has healed, leaving a minor scar. There is no medical support for any more serious injury, or for any ongoing symptoms or problems arising from the accident. A skull x-ray and CT scan of the brain two days after the accident revealed no post-traumatic change.

I find, therefore, that he suffered minor and temporary injuries to the head. Any consequences of the concussion had resolved within weeks of the accident and there are no continuing problems or symptoms attributable to any neurological aetiology relating to the head.

The orthopaedic injuries 45. Mr Kazic alleges injuries of an orthopaedic nature to his neck, right shoulder, low back and left leg.

The injury alleged in respect of the left leg was not specified with any particularity, but Mr Kazic complained of pain, following the accident, radiating down the leg to his foot, aggravated by walking and running. He walks with a limp.

The injury to the neck was alleged to have involved a postero-lateral disc protrusion of the C5/6 intervertebral disc, impinging on nerve roots at C6.

The injury alleged in respect of the right shoulder was not particularised. But Mr Kazic complained of pain and restriction of movement in the shoulder. An ultrasound examination in February 2003 revealed thickening and impingement of the subacromial/subdeltoid bursa suggestive of bursitis. There was, however, no tendon damage.

The injury to the lower back was alleged to have involved circumferential bulging of the disc annulus at the L5/S1 level, with adjacent osteophyte development.

Before turning to examine the medical evidence it is important to observe that Mr Kazic had experienced considerable orthopaedic problems prior to the accident, some dating back to the war in Bosnia as a young man, others relating to soccer injuries. It is clear that he had various previous injuries and serious pre-existing constitutional problems involving various parts of his body, but in particular his neck and back. He was, however, less than candid about these matters in his evidence-in-chief, which reflected poorly on his credit. He also went to considerable lengths to conceal his true medical history from the doctors. This is starkly illustrated by the detailed Table in the written submissions of Eastside Scaffolding (para 11). This colours the various medical opinions, particularly those that were heavily reliant on subjective complaints.

The high point of the medical support is to be found in the report of Dr Drew Dixon, an orthopaedic surgeon retained by the solicitors for Mr Kazic, upon whose evidence counsel for Mr Kazic placed great reliance (para 3.10). He examined Mr Kazic once, and not until this year, some 5 years after the accident. Dr Dixon provided a single report dated 31 January 2007. He was also given a misleading history in respect of prior neck and back problems.

Dr Dixon expressed the following views as to Mr Kazic's condition:

Head injury without amnesia or loss of consciousness with residual headaches.
Neck strain injury with residual lower facet arthralgia and trapezial muscle pain and neck stiffness, together with disc lesions at C5/6 and C6/7.
Bilateral shoulder brachalgia with subacromial bursitis bilaterally with painful arcs on abduction.
Back strain injury with residual lumbo-sacral back pain secondary to his L5/S1 disc lesion where he has aggravated lumbo-sacral spondylosis at this level.

Dr Bodel, an orthopaedic surgeon, examined Mr Kazic for medico-legal purposes on 2 May 2005 and 13 February 2007. I pause to observe that although Dr Bodel was qualified on behalf of the employer's insurer, counsel for Mr Kazic also placed reliance on his opinion (para 3.7). The history taken by Dr Bodel was that Mr Kazic had had no other accident or injury involving the head or neck, and had previously been "quite well". This was not true. In 2005 Dr Bodel examined Mr Kazic, reviewed the radiological evidence available, and concluded that there had been injuries to the neck, back and right shoulder in the accident, from which Mr Kazic has slowly improved, but never completely recovered. Surgery on the right shoulder was a possibility. It seems clear that Dr Bodel accepted Mr Kazic's complaints without question and that his opinion was influenced accordingly. However, after his second examination in 2007, Dr Bodel shifted ground quite considerably, particularly in the light of other reports, including an assessment by Dr Fearnside. In his second report Dr Bodel diagnosed soft tissue injury to the neck, shoulders and back, but on clinical testing found 'significant medical inconsistency between his level of complaint and any objective findings of abnormality'. He could find no objective signs of any 'rateable pathology'. Dr Bodel concluded:

He has some mechanical symptoms in the neck and back associated with minor degenerative change but I see no clinical indication that the accident on 23 February 2002 caused major structural damage in the neck or back.

The soft tissue injury caused by the accident on 23 February 2002 has now resolved in my view and ongoing complaints relate to constitutional factors. He should be capable of a return tomoderate manual tasks although he would have difficulty with work as a gyprocker. His ability to find work on the open labour market has not been compromised by this injury but he does have underlying degenerative changes which will make it difficult for him to work in his pre-accident activities. He is capable of full time permanently modified duties and will need the assistance of a rehabilitation facility in order to find more appropriate work.

Associate Professor Oakeshott is another medico-legal expert who examined Mr Kazic on behalf of Waco Kwikform. His first examination took place on 18 March 2005, and there was a second examination on 27 July 2006. Mr Kazic also told this doctor he had not had any problems with his neck or back prior to the accident. During his first examination in 2005, Professor Oakeshott found that Mr Kazic exhibited 'significant abnormal pain behaviour'. He was unable to identify any objective clinical evidence of any physical injury or underlying pathology in any part of his body that could be attributed to the accident and that could account for his now widespread symptoms. In his opinion, Mr Kazic had made a complete and permanent recovery from the injuries sustained in the accident. He went on to say, "It is my opinion that his present symptoms are arising from factors other than physical injuries…"

Dr Oakeshott expressed the same views following his second examination in 2006, and attributed changes observed in x-rays to a constitutional origin. On this occasion, however, he went further and said, "It is my opinion that his symptoms are arising from psychological (non-organic) factors".

There were also reports from two neurosurgeons, Dr Bleasel and Associate Professor Mark Sheridan. Counsel for Mr Kazic made no reference to these two doctors in his submissions. The report of Dr Sheridan was short, unspecific and in my view unhelpful in reaching a conclusion on the causative aspects of the orthopaedic injuries alleged. I discount his views in forming my conclusions. Dr Bleasel's report is interesting, in that the history he obtained was at odds with others in respect of the shoulder injury, and he concludes that the shoulder problems were not caused by the accident; rather they were a product of the nature and conditions of Mr Kazic's post-accident employment. It was difficult to see just how Mr Kazic injured his shoulder from a blow to the head, unless it occurred in the fall, but evidence as to the mechanics of the injury was missing from all the reports, except that of Dr Sachdev, who thought the blow to the head may have caused an acute flexion of the neck, and even of the back. The defendants placed great reliance on Dr Bleasel, but in the final analysis, I preferred the other medical evidence.

The substantive expert medical support for Mr Kazic, in terms of him having an identifiable physiological basis for any continuing orthopaedic consequences that can properly be attributed to the accident comes, therefore, from Dr Dixon. I found his report unconvincing. His evidence is out of step with the preponderance of the other orthopaedic opinion. His opinion was also influenced by the misleading history, and heavily reliant on subjective complaints. Unlike Dr Bodel, he was dismissive of the other, objective, evidence, and his conclusions bear little objective clinical analysis or reasoning. In the event I preferred the other medical opinion.

The conclusions I draw from the medical evidence as to the alleged orthopaedic problems are as follows. There is support for the position that Mr Kazic suffered some serious soft tissue injuries in his accident, and that these more probably than not persisted for some considerable time, and possibly as long as several years. However, the effects of those injuries had resolved and were gone by the time the expert specialists began to examine him in 2005. So far as the left leg is concerned, there was never any specific injury from the accident. Any symptoms or problems in that leg can only be attributed to pre-existing problems, particularly in the knee (Ex 4D3), or to referred sciatic pain, more probably than not due to underlying degenerative problems than the injuries sustained in the accident. So far as the neck, shoulders and low back are concerned, any symptoms from 2005 on are attributable either to pre-existing or underlying conditions, or to something else.

I am satisfied, therefore, that Mr Kazic suffered from disabling symptoms and was incapacitated for work from the time he left work in October 2002 until the end of 2005 as a result of the accident. He may have continued to experience continuing problems beyond that time, but not due to the accident. I find that there has been no disability or incapacity since that time of orthopaedic or neurological origin that is attributable to the accident.

The psychological condition 60. Overlaying his physical problems, Mr Kazic also developed a depressive condition. The starting point for an examination of the psychological evidence is the report of the clinical psychologist, Wendy Bailey, to whom he was referred by his general practitioner late in 2002 soon after he stopped working. She records complaints by him of ongoing and persistent pain and chronic headaches, causing sleep disturbance, low energy, lethargy and a reduced appetite. He was finding it hard to cope and expressed feelings of hopelessness and worthlessness. He was experiencing memory and concentration difficulties, breathing problems, irritability and mood swings, a loss of libido, negative thinking patterns and excessive worry. Ms Bailey diagnosed an Adjustment Disorder with mixed anxiety and depressed mood and recommended neuropsychological assessment, which eliminated any persisting neurological problems from the head trauma, and therapy for his anxiety and depression. A number of counselling sessions followed, but his symptoms persisted.

He was next seen by Dr Zepinic, a consultant in Psychological medicine, who also undertook therapy sessions. He provided a report dated 9 March 2004, in which he records his diagnosis of an Adjustment Disorder with mixed emotional features, secondary to his physical injuries and incapacity for work. It is not clear how many times he saw Dr Zepinic, but he told Dr Sachdev in August 2004 he had been seeing a psychiatrist fortnightly for 18 months.

The next phase of the psychological background was the interview on 18 August 2004 by Dr Sachdev, a professor of neuropsychiatry at the University of NSW. His first report is dated 12 September 2004, in which he concluded that the salient feature of his presentation was the 'chronicity of his pain syndrome'. The pain, however, appeared 'out of proportion to the injury'. He went on to say:

In such cases of chronic pain it is not unusual for psychological factors to be quite important in the maintenance of the pain. These psychological factors, in his case, are likely to be the stress of migration, the disappointment of not achieving stable occupation, the threat of invalidity with the incident, and potential secondary gain from the disability. However, the fact that his income is now much below the level while he was working suggests that material gain is not understandable as a strong motivating factor.

His psychiatric symptoms are characterized by depression and anxiety which is best understood as a response to the chronic pain and the consequent disablement from an occupational and social viewpoint. These symptoms are however significant enough to cause disability in their own right. They are of moderate intensity. I agree with the diagnosis given previously of an Adjustment Disorder with depression and anxiety. In other words, this is a reaction to pain and distress as well as loss of occupational and social roles...

Dr Sachdev again interviewed Mr Kazic and reported on 31 July 2007. His view was unchanged, and he diagnosed a mild depressive syndrome secondary to a pain syndrome and the stresses of unemployment, financial difficulties and poor relationship. In his current state it was unlikely that he could work for more than a few hours a week. His disability is chronic and likely to be persistent. He will need ongoing psychiatric assistance, drug treatment, pain management and occupational rehabilitation.

Mr Kazic's solicitors also sent him to see another psychiatrist, Dr Thomas Oldtree Clark, for medico-legal assessment. Dr Clark saw him on 23 June 2006, and reported on 9 July 2006. The doctor found no signs of mental illness as such, but found a mood disorder with psychological signs of anxiety and chronic depression, and diagnosed a Dysthymic Disorder, in other words persistent mild depression. His doctor disagreed with the other doctors who diagnosed an Adjustment Disorder and did not feel Mr Kazic fulfilled the clinical features necessary for that condition. The difference appears to be that an Adjustment Order is cured when the stressor is removed, but Mr Kazic's condition is chronic.

As against this consistent body of expert opinion, the defendants submitted that I should prefer the opinion of Dr Phillips, a consultant psychiatrist qualified on behalf of the second defendant. This doctor saw Mr Kazic on 24 June 2005 and reported on 29 June 2005. He found Mr Kazic to be mildly depressed, but that his symptoms were not sufficient to warrant a diagnosis of a major depressive disorder, dysthymic disorder, generalised anxiety disorder or post-traumatic stress disorder. At worst, he had a very mild adjustment disorder with mixed features. Dr Phillips was worried by the seemingly histrionic and exaggerated presentation. He believed that the 'relatively mild injury in the work incident' was of insufficient intensity to explain his ongoing physical and psychological symptoms.

In assessing the psychological evidence, the orthopaedic picture, as I have found it, is determinative. Thus I am bound to reject the opinion of Dr Phillips that the accident and the injuries were insufficient to cause a persisting psychological condition of any severity. On the other hand, his diagnosis of and adjustment disorder is consistent with the preponderance of opinion, particularly that of the treating practitioners, especially those who saw him over a long period of time, such as Ms Bailey and Dr Zepinic. To this extent, I reject Dr Clark's diagnosis of a dysthymic disorder, and find that Mr Kazic's psychological condition has been an adjustment disorder, attributable to the stressors described, that is, it has been secondary to his pain, his inability to work and provide financial support for his family, and the consequential distress, worry and anxiety, associated with feelings of hopelessness and worthlessness. Nevertheless, the exaggeration and histrionics described by Dr Phillips is consistent with other evidence, such as that from Dr Sachdev, and the evidence of Mr Kazic's ability to participate in the supervision of the construction of his new home near Perth, and there must remain doubt as to the chronicity of his condition. Although the now longstanding nature of the condition indicates that its alleviation is problematic, it is also to be observed that all the doctors regard it as mild. I conclude, therefore, that there are strong indications for improvement, particularly once this litigation is over.

I find, therefore, that notwithstanding the physical effects from the accident had ceased to impact on Mr Kazic by 2005, the psychological consequences of it persisted beyond that time, and incapacitated him for work from that time to the present. I do not accept, however, that the effects of the accident have been such as to render him totally and permanently incapacitated for work, and I find that he has retained a substantial residual capacity to earn. There are ongoing physical problems, but they are unrelated to the accident. From a psychological viewpoint, the ongoing stressor is no longer due to the accident. There is also an inconsistency of presentation, associated with exaggeration. The problem is, to adopt the phrase of counsel for the second and third defendants, in 'unravelling the compensable from the non-compensable elements' of Mr Kazic's claim.

The payments of Workers Compensation 68. The insurer of Mr Kazic's employer, the first defendant, has made payments of workers compensation, by way of medical and associated out-of-pocket expenses, by way of weekly compensation, and by way of compensation for permanent impairment and pain and suffering. It was submitted by his counsel that such payments amount to admissions by that defendant that Mr Kazic has been incapacitated since 31 October 2002 and suffered permanent whole person impairment of at least 17%: Heuston v Yore Contractors Pty Ltd (unreported, NSWSC, Hunt CJ at CL, 9 March 1992).

I accept that payments of workers compensation are capable of amounting to admissions of incapacity and impairment. However, such admissions do not amount to an estoppel and may be explained away, as they have been in this case. If, in subsequent common law proceedings arising from the same set of circumstances, different evidence emerges, issues are more fully ventilated, and different findings are open, the employer and its insurer are not bound by way of admissions arising from payments of workers compensation in a way that exposes them to an uncontestable liability to pay damages. Such is the forensic risk undertaken by a plaintiff who embarks upon a claim for damages at common law, which extinguishes his rights to workers compensation. In this case it is clear that different evidence has emerged, not the least being the evidence of prior injuries and problems not disclosed to doctors, which coloured medical opinions relied upon in the assessment of the workers compensation liability. Dr Bodel, for example, upon whose opinion the insurer relied in 2005, had a very different opinion in 2007 when other evidence emerged. This court was, in my view, entitled to assess the issues of incapacity and impairment untrammelled by what might have occurred in respect of the workers compensation claim.

It was also submitted for Mr Kazic that there was no challenge to Mr Kazic's claim by way of surveillance or similar evidence. I draw no inferences from the fact that no such evidence was adduced. There are many plausible explanations for that, such that the inferences are equivocal, and I prefer to evaluate and rely on the evidence adduced rather than any that was not adduced in that regard. Out of pocket expenses
A claim is made for past out-of-pocket expenses made up of the payments of workers compensation of $81,808.90 plus other unpaid expenses for pharmaceuticals and medical consultations, and an HIC charge, a total of $85,076.10 (Ex C). There is no dispute as to the mathematics. Having regard to the findings I have made, I am satisfied that the claim is reasonable and I allow it, rounded off, at $85,075.00. There is no claim for interest.

A claim of $22,340.00 is made for future out-of-pocket expenses of $25 a week for the rest of Mr Kazic's life. This is made up of medication, physiotherapy and ongoing psychiatric counselling. In my view, the claim does not reflect Mr Kazic's likely future needs. There can be no entitlement to physiotherapy, and I consider it unlikely he will undergo significant future counselling or require medication once these proceedings are over and the stressors are no longer present. I allow a cushion of $15,000.00 for some short-term need.

Economic loss 73. A claim is made for past economic loss on the basis of a weekly loss of wages of $900 net per week from 1 November 2002. There was no serious challenge made by the defendants to the mathematics of the claim. Having regard to my findings, Mr Kazic is entitled to be compensated for lost earnings from 1 November 2002 to date, a period of 254 weeks, a sum of $228,600.00. An allowance for lost superannuation of $20,860.00 is to be added, together with tax paid on weekly compensation (Fox v Wood) of $30,110.00. The total is $281,570.00.

Turning to the future, the claim made by Mr Kazic is for $422,830.00, being $600 net per week for 25 years, plus superannuation. He concedes a residual earning capacity of some $300 net per week. In sorting through the compensable from the non-compensable losses, account must be taken of my findings that there is no ongoing physical impairment attributable to the accident. Any ongoing psychological condition is mild, improving and more probably than not will dissipate within a short period following the resolution of these proceedings and the removal of the stressors precipitating that condition. In my view, there is no significant loss of future earning capacity that can be attributed to the accident, and the appropriate way to compensate Mr Kazic is by way of a buffer, weighted more to the short term.

I am satisfied that the following assumptions about Mr Kazic's future earning capacity accord with his most likely future circumstances, but for his injury: he would have worked in the same or similar employment, at similar levels of seniority and at similar levels of earnings for a further 10 years. As he aged, however, the effects of his previous injuries and pre-existing constitutional conditions would have had serious adverse effects on his ability to work and his capacity to earn: s 13 of the Civil Liability Act 2002.

There are no special circumstances that are to be taken into account, and I find therefore that the damages that would have been awarded are to be adjusted by reference to an 85% possibility that the events concerned might have occurred but for his injuries, and are thus liable to be discounted by the accepted standard 15% for contingencies.

I find that his earning capacity in the future will be impaired, by reason of the effects of his accident, to a moderate degree for a short period only and thereafter will be largely unaffected. Any incapacity to earn will otherwise be a product of factors other than the accident, whether physical in origin or as a consequence of some psychological condition secondary thereto.

In all the circumstances, I assess damages for future economic loss in an amount of $75,000.00, which amount includes future superannuation. I discount this figure, for contingencies, by 15%, producing an award of $63,750.00.

Future domestic assistance 79. Mr Kazic makes a claim of $107,232 for future handyman assistance. Having regard to the findings I have made there is little basis for an award of that magnitude. It is appropriate, however, to allow a cushion, again referable to possible short-term needs. I allow $15,000.00.

Non -economic loss 80. It was submitted that I should assess the severity of the non-economic loss (as a proportion of a most extreme case) in the order 40 to 50%. The defendants contended that the assessment should be less than 15%.

In assessing the damages for non-economic loss for Mr Kazic, I have regard to the totality of his circumstances. I take into account his age. In particular, I take into account that he has suffered over a number of years with pain and discomfort, anxiety and stress. The future, however, is not so bleak, so far as the consequences of the accident is concerned. Again, it is a matter for judgment as to how to differentiate between the compensable consequences of his accident and the non-compensable matters from which he may continue to suffer.

I determine that the severity of the non-economic loss as a proportion of a most extreme case is 27%. That produces a statutory amount of $44,000.00: s 16(3) of the Civil Liability Act 2002.

I find, therefore, that Mr Kazic's non-economic loss should be assessed at $44,000.00. Calculations as to damages
The calculations as to total damages against the respective defendants is as set out in the Table below: Table Heads of Damage 1st defendant 2nd, 3rd & 4th defendants Past out-of-pocket expenses - $ 85,075.00 Future out-of-pocket expenses - $ 15,000.00 Past economic loss $281,570.00 $281,570.00 Future economic loss $ 63,750.00 $ 63,750.00 Future domestic assistance - $ 15,000.00 Non-economic loss Not recoverable $ 44,000.00 Total damages $345,320.00 $504,395.00

I therefore find total damages against the respective defendants in accordance with the total amounts set out above in the Table. Adjustments under the Workers Compensation Act 1987
I turn now to consider the adjustments required under s 151Z Workers Compensation Act 1987 (NSW).
The damages recoverable by Mr Kazic from the second, third and fourth defendants are to be reduced by $7,953.75, being 5% of the difference between the total damages assessed against them and the damages recoverable against the first defendant ($504,395.00 - $345,320.00 = $159,075 x 5% = $7,953.75). The adjusted damages payable by each of those defendants are, therefore, $496,441.25 ($504,395.00 - $7,953.75 = 496,441.25): s 151Z(2)(c).

The amount of the contributions as between the defendants is also to be adjusted accordingly, and determined as if the whole of the damages were assessed in accordance with Division 3 of the Workers Compensation Act 1987 (NSW)s 151Z(2)(d). It follows that the contributions are as follows:

1st defendant from 2nd defendant: 5% of $345,320.00 = $ 17,266.00 1st defendant from 3rd defendant: 15% of $345,320.00 = $ 51,798.00 1st defendant from 4th defendant: 75% of $345,320.00 = $288,990.00

2nd defendant from 1st defendant: 5% of $345,320.00 = $ 17,266.00 2nd defendant from 4th defendant: 75% of $504,395.00 = $378,296.25

3rd defendant from 1st defendant: 5% of $345,320.00 = $ 17,266.00 3rd defendant from 4th defendant: 75% of $504,395.00 = $378,296.25

4th defendant from 1st defendant: 5% of $345,320.00 = $ 17,266.00 4th defendant from 2nd defendant: 5% of $504,395.00 = $ 25,219.75 4th defendant from 3rd defendant: 15% of $504,395.00 = $ 75,659.25

Disposition 89. I note that the causes of action based on alleged breaches of statutory duty pleaded by the plaintiff were abandoned.

I therefore enter verdicts as follows: Claim by Claim against Amount Mesud Kazic GIO Workers Compensation $345,320.00 John Holland $496,441.25 Waco Kwikform $496,441.25 Eastside Scaffolding $496,441.25 GIO Workers Compensation John Holland $ 17,266.00 Waco Kwikform $ 51,798.00 Eastside Scaffolding $288,990.00 John Holland GIO Workers Compensation $ 17,266.00 Eastside Scaffolding $378,296.25 Waco Kwikform GIO Workers Compensation $ 17,266.00 Eastside Scaffolding $378,296.25 Eastside Scaffolding GIO Workers Compensation $ 17,266.00 John Holland $ 25,219.75 Waco Kwikform $ 75,659.25

I order the defendants to pay the plaintiff's costs, on the ordinary basis.

I order that each of the successful cross-claimants are to have their costs as against the cross-defendants in the respective cross-claims, on the ordinary basis.

The exhibits are to remain in court for 28 days, after which period they may be returned to the parties.

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.

CITATION: Kazic v GIO Workers Compensation (NSW) Ltd [2007] NSWDC 342

Caledonian Collieries Ltd v Speirs [1957] HCA 14 at [12] Liftronic Pty Limited v Unver [2001] HCA 24 at [2] CASES CITED: Romeo v Conservation Commission of the Northern Territory [1998] HCA 5 at [128] Sheldrick v State of New South Wales [2007] NSWCA 105 at [53] Sungravure Pty Ltd v Meani (1964) 110 CLR 24 at 37 Thomson v Bankstown Corporation (1953) 87 CLR 619 at 630

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