Nightingale v Mt Arthur Coal Pty Ltd

Supreme Court of NSW|2019-04-10|Before: Schmidt J

Judgment

Mr Nightingale seeks orders under s 140 of the Civil Procedure Act 2005 (NSW) transferring the proceedings which he commenced in the District Court to this Court. He contends that the damages which will be ordered, if he is successful, are likely to exceed the jurisdictional limit of the District Court: s 140(3). That is in issue and so the transfer is opposed by the defendant mining company.
Mr Nightingale's case is that he was injured while working as a driver at the Mount Arthur Open cut mine, while the truck he was driving was being loaded by an employee of the mine operating a face shovel excavator. He claims that the result was not only a substantial injury to his neck, but also a major depressive disorder and ongoing physical incapacity which prevents him from undertaking his former work at all, or other work, full-time.
The mining company defends his claims, there being issues between the parties both as to the nature and consequences of any injury which Mr Nightingale suffered, as well as the consequences of s 151Z of the Workers Compensation Act 1987 (NSW), for any orders made against it.
There is no issue that when he was injured Mr Nightingale was the direct employee of a labour hire company, but it is not a party to the proceedings, so that s151Z will arise for consideration.

Issues

The applicable principles are also not in issue. To resolve the application it must be assumed that Mr Nightingale will establish liability.
An assessment of the individual components of Mr Nightingale's damages claim is not required. Rather, what must be determined is whether it appears likely on the evidence, that Mr Nightingale's damages will exceed $750,000, that involving "to an extent as a matter of impression": Johnstone v State of New South Wales [2006] NSWCA 105 at [22] - [23].

Should the proceedings be transferred to this Court?

The parties' cases

Mr Nightingale would prefer for his matter to be dealt with in the District Court, but the mining company has not consented to orders exceeding its jurisdictional limits being made in his favour.
If the matter is transferred, Mr Nightingale is in a position to promptly file an evidentiary statement required under this Court's procedures, but he accepts that the costs of the litigation will likely be increased and that there will be a longer delay before trial in this Court, than if the matter remains in the District Court.
Given advice that the $750,000 jurisdictional limit is likely to be exceeded and Mr Nightingale's hopes of being able to undertake more part-time work not having materialised, his case is that management considerations ought not to preclude the transfer which he seeks.
The mining company's position is that not only is there a significant dispute on the expert evidence as to whether Mr Nightingale had suffered any significant injury to his cervical spine and arm in the alleged incident, but there is evidence which establishes that he still has the physical capacity to perform work he had undertaken for 10 years as a betting agency clerk, which would preclude substantial damages for future economic loss being awarded.
That is said to be because Mr Nightingale has not pursued such employment, because he did not like that work, contrary to his obligation to mitigate his loss. That, together with how other matters in issue are likely to be resolved, is argued to establish that it was likely that any damages ordered, would fall below the District Court's jurisdictional limit.
The mining company also contended that under s 151Z(2) of the Workers Compensation Act any damages would be reduced by 25%: TNT Australia Pty Limited v Christie & 2 Ors; Crown Equipment Pty Limited v Christie & 2 Ors; Manpower Services (Aust) Pty Limited v Christie & 2 Ors (2003) 63 NSWLR 1; [2003] NSWCA 47.
Mr Nightingale having been employed by a labour hire company to drive a dump truck at the mine and there being, not only many other of its employees working there, but also a manager, there was a strong likelihood that his employer would also be found to have been liable for any injury which he had suffered, as a result of the matters which he advanced in his pleadings.
It was also contended that there was no basis in the medical opinions, for the conclusion that Mr Nightingale had suffered a permanent disability caused by injury to the cervical disk.
Accordingly, it was submitted that the conclusion that the jurisdictional limit would be exceeded, was not open.
The mining company also relied on s 56 of the Civil Procedure Act to submit that while it had not served all of its medical evidence until later in 2018, from early 2018 Mr Nightingale's legal representatives were in a positon to determine on his evidence, whether there was a likelihood that the assessment of his damages would exceed the jurisdictional limit.
There was no explanation for the delay, from that time, in this application, in circumstances where, had this application not been made, the matter could have been listed for hearing in the District Court in March to May 2019. The overriding purpose specified in s 56, thus required the application to be refused.
For the reasons which follow, I am satisfied that the mining company's submissions cannot be accepted.

Section 151Z of the Workers Compensation Act

There was no issue that the mining company was in a similar position to that of TNT in TNT Australia Pty Limited v Christie, namely, that it owed Mr Nightingale a non-delegable duty of care given that his direct employer was a labour hire company, it having placed itself "in a relationship, day in and day out, indistinguishable from that of employee and employer": at [41]. That generated a stringent duty of care falling upon the mining company in relation to safe systems of work: at [42] referring to Stevens v Brodribb Sawmilling Co Pty Ltd (1986) 160 CLR 16; [1986] HCA 1. That duty also extended to the safety of plant: at [50].
But the labour hire company was not relieved of either the duty of care which it owed Mr Nightingale as his employer, or the statutory obligations in relation to ensuring his safety, which fell upon it as a result: TNT at [63] - [70].
Thus s 151Z of the Workers Compensation Act has been pleaded by the mining company by way of partial defence, given the nature of the ongoing employment relationship between Mr Nightingale and the labour hire company.
Nevertheless, questions of causation will arise to be determined in relation to the labour hire company, which will depend on the factual findings as to the cause of Mr Nightingale's accident, about which no findings can presently be made: TNT at [78].
Still it was the mining company's case that the apportionment of damages arrived at in TNT, namely 75% TNT and 25% Manpower, reflected what would also likely result in Mr Nightingale's case.
In my view there is simply insufficient evidence upon which that conclusion can be arrived at. If a case under s 151Z is established against Mr Nightingale's direct employer, it may be found that the proper apportionment of damages is less or more than that arrived at in TNT. That will depend on what the evidence establishes as to the respective responsibility of the two companies which owed Mr Nightingale duties of care.
Further, even accepting what the mining company advanced and reducing the calculation of likely damages by 25%, I am satisfied that it is still likely that if Mr Nightingale succeeds, the damages awarded will exceed the District Court's jurisdictional limit.
This conclusion rests on the following

Mr Nightingale's calculation of damages

First, the damages Mr Nightingale contended he is likely to be awarded, if successful, include: 1. earnings calculated at $650 net per week, Mr Nightingale having been earning $1,650 at the time of injury and not having earned in excess of $183 per week since then; 2. past economic loss calculated at $375,226; 3. future economic loss assuming ongoing partial incapacity at $492,575; 4. non-economic loss calculated at 40% of a most extreme case at $254,000; and 5. total loss with all other claims except past or future out of pocket expenses or assistance taken into account, at $1,229,129.
Even assuming a 25% reduction, the District Court's jurisdictional limit will be exceeded.
In Mr Nightingale's calculation, no account has been taken of past or future expense for medical treatment or assistance. The evidence establishes, however, that past assistance expenses have already been substantial, as must his medical expenses have been, given the surgery and other treatment he has received. Those heads of damage would thus further increase the damages awarded.
The issues lying between the parties' medical and other experts must also be considered. Whether heard in this Court or the District Court they will be resolved after joint reports are prepared and the expert evidence is heard concurrently.
Symptoms Mr Nightingale has described include dull aching pain in the neck; a burning sensation extending from the neck to the right elbow; numbness and tingling in the right hand and fingers on occasions; lesser referred pain in the left arm; and interscapular pain aggravated by bending, twisting, lifting or using his arms overhead. His experts have assessed him as unable to return to his pre-injury duties and their opinions about his successful return to the workforce depended on improvement in his symptoms and what such work would involve.
The mining company's expert does not consider that Mr Nightingale has any ongoing incapacity. He disagrees with the opinions of Mr Nightingale's experts, having observed that they were "struggling to make a diagnosis"; that there was no objective evidence that Mr Nightingale had suffered discal damage; and that changes seen on investigations are "merely the changes of aging and not due to trauma nor can these changes, which are genetically based, be aggravated permanently by a traumatic event".
The basis for the latter opinion is not provided and is difficult to understand. That a change to the spine, whether caused by ageing or genetics, may be permanently aggravated by a traumatic event appears to be perfectly possible. An obvious example is where trauma causes a fracture, which does not heal well.
Further, the opinions of Mr Nightingale's experts reveal that not only had they each made a diagnosis, but they had both explained its basis. In one case, for example, the opinion was based upon an MRI scan which showed minor disc bulges at several levels of the cervical spine, which it was considered were not susceptible to treatment.
In the result, it is by no means certain that the opinion of the mining company's expert will be preferred.
As to the vocational experts, Mr Nightingale's expert concluded that he was permanently unfit to perform his former work and identified work which he could not perform; explained why he was keen to attempt work; and thought it unlikely that he could perform more than 20-25 hours work, in suitable employment.
Such work was later identified to involve sedentary and selected light work on no more than 30 hours a week, given Mr Nightingale's transferable skills, with the most lucrative identified being a betting agency counter clerk, with gross wages of $1,408. That was work which he had in the past performed, but had not enjoyed. Mr Nightingale did pursue part-time retail work at Bunnings, another type of identified suitable work, but in April 2019 he gave up that employment, which he found he could not manage.
In the mining company's earning capacity assessment report, the assessor disagreed with restrictions advised by Mr Nightingale's GP. He was there assessed as being capable of full-time work, provided he observed recommended restrictions. They included all physical activities being undertaken below mid-chest and close to the body, with frequent manual handling limited to 10 kg and occasional lifting of up to 20 kg, considered to be possible.
Suitable work options were also then identified, including sale work of the kind which Mr Nightingale undertook at Bunnings and a betting shop cashier, but it was agreed that he could not return to his preinjury duties. The most lucrative employment identified commanded gross earnings of $1594 per week.
Given that the calculation of damages advanced for Mr Nightingale was based on net earnings of only $650 per week, that figure having been selected to take into account the gross figure of $1594 per week, it is not apparent that his damages are likely be calculated at a figure significantly below $650. That also supports the conclusion that the District Court's jurisdictional limit is likely to be exceeded by any award of damages.

The course of the proceedings in the District Court

In the District Court, subpoenas have been issued and answered and there have been orders as to the service of medical and liability reports, aspects of which both parties failed to comply with. But the matter is now at a point where a date for hearing will soon be given, whichever court hears it.
That this will be a later date, if the matter is transferred to this Court, is not a basis for refusing the application. Hearing dates allocated will always depend on what demands are being made, at particular times, on the respective court's resources.
The mining company argued that the delay between the time that it became apparent that the District Court's jurisdictional limit might be exceeded and the filing of the transfer application was not adequately explained.
The evidence is that Mr Nightingale worked at Bunnings from September 2017 to April 2018, hoping that he would be able to increase his working hours over time, to support his family, but in April he resigned, because of the constant aggravation to his condition which that work caused. It was in October 2018 that he was advised that while it would be quicker and cheaper to have his matter heard in the District Court, in his circumstances, if the medical evidence which he had filed was accepted, damages awarded would exceed the District Court's jurisdictional limit.
The unchallenged affidavit evidence was that it was due to oversight that these proceedings were not commenced until December 2018, when the matter had been adjourned in October, to allow that application to be made.
I do not consider that justice permits that the delay in the application for transfer being made to this Court to result in its refusal. Part of the delay occurred at a time when Mr Nightingale's circumstances were obviously changing and it is also explained, in part, by representative error.
Section 58(1) requires that when making orders for the management of proceedings, the Court must seek to act in accordance with the dictates of justice and to have regard to the overriding purpose specified in s 56, to facilitate the just, quick and cheap resolution of the real issues in the proceedings.
Keeping the matter in the District Court would certainly be quicker and cheaper, but I am satisfied that in the circumstances I have discussed, it would not be just. That conclusion is reinforced when the mining company's refusal to consent to that Court awarding damages in excess of its jurisdictional limit, is also taken into account.

Costs

Costs were also in issue.
The usual order under the Rules is that costs follow the event, which would be an order in favour of Mr Nightingale.
The mining company contended that in the circumstances, the price of his success should be an order that he pay its costs. Mr Nightingale opposed that order, but conceded that the costs order should be that costs of the application are costs in the cause.
In the circumstances I have discussed, I am satisfied that justice does not require the departure from the usual costs order for which the mining company contended. That would require some misconduct in the proceedings to be established. While there has been delay, it has been explained and cannot be viewed as amounting to misconduct.
In the result, I am satisfied that Mr Nightingale's concession provides a just basis for the costs order.

Orders

For these reasons, I order that: 1. The proceedings between the parties in 2017/43733 in the District Court New South Wales at Newcastle Registry be transferred to the Supreme Court of New South Wales pursuant to s 140 of the Civil Procedure Act 2005 (NSW). 2. Costs of these proceedings shall be costs in the cause.

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: 17 April 2019

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