Nolan v Hamersley Iron Pty Ltd & Ors [1999] WADC 18

Nolan v Hamersley Iron Pty Ltd & Ors [1999] WADC 18 | Case summary | Zoe

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7 Nolan attended school to age 15 years. After leaving school he completed an apprenticeship as a chef. He did not however work as a chef but commenced employment with Civil Mechanical Maintenance as a trades assistant.

8 In 1985 he joined the navy. He left the navy in June 1991. He then commenced employment with Speno. His family had some connection with Speno in that his father was the technical services manager and his brother Nicholas was also employed by Speno.

9 He was employed by Speno as a grinder operator. A grinder is a track machine equipped with grinders to increase the longevity of both the rail line and the rolling stock.

10 Initially he was employed in Bridgetown Western Australia. He then moved to New South Wales. About one year prior to his accident he commenced work in the Pilbara on the Hamersley contract. He was employed on the basis of twenty days on and ten days off flying in and out of Perth.

11 According to Nolan prior to his accident he had raised with Speno the question of being relocated to Perth to work on a grinding machine. He was told that he needed to stay in his then job and as at the date of his accident the transfer was to be in the future.

12 He had also had discussions with a Mike White from Speno in relation to training in the ultra sonics area. He had been approached three times in relation to ultra sonic testing and was told that once he completed his training he would have been able to move to ultra sonic testing.

13 According to Nolan he had no health problems in his teenage or early adult years. On 9 February 1994 he consulted a Dr Kelly because he required an annual medical fitness certificate in order to operate on the railway equipment. At that time he told Dr Kelly that he was feeling tired and having stomach pains and also had a chill. But he told Dr Kelly that he would chase that up back in Perth.

14 On 14 February 1994 he attended upon his general practitioner, Dr Vandermoezel. Prior to that date he had not been certified as being unfit for work. Dr Vandermoezel did a number of tests and referred him to a neurologist Dr Rowling and a physician Dr Klimaitis. On 13 July 1994 he attended at the Nichol Bay hospital. All of these attendances related to the same problem but he did not lose any time from work and thereafter the problems subsided. Although his problems subsided they routinely returned. He was prescribed antibiotics to clear up an infection.

15 From August 1994 to April 1995 he did not consult a doctor about these matters.

16 In April 1995 he had what he described as a bad attack. He was passing blood and vomiting and suffering from diarrhoea. He was admitted to Wanneroo Hospital for dehydration. He had acute stomach pains and he could not keep anything down.

17 When asked to stand and close his eyes he fell to one side.

18 He was referred to a neurologist Dr Goodheart. He saw Dr Goodheart on 2 May 1995. He was told that there was nothing neurologically wrong with him and that he could return to work.

19 He returned to his job in May 1995 and was doing his normal shifts and duties.

20 The accident occurred on 24 May 1995. At that time he was driving the HIRail vehicle in the early morning. He has no recollection of the accident or of the weeks following the accident. His first memory is of waking up in Sir Charles Gairdner Hospital. At that time he had difficulty in walking and being understood when talking. He underwent tests at that time and the occupational therapist was assisting him. His walking endurance was very limited and his wife had to assist him when walking. At the present time he uses a walking stick to increase endurance and to take the load from his right leg but he is able to walk without his stick.

21 He was released from Sir Charles Gairdner Hospital on 13 June 1995. Since leaving hospital his speech has improved but his wife Donna has to keep close tabs on him.

22 He remained an outpatient at Sir Charles Gairdner Hospital for some six to eight weeks and thereafter consulted with Sir Charles Gairdner Hospital and the Royal Perth Hospital Shenton Park Annex for a period of twelve months after his release from hospital. During that time he was residing at home. Eating and dressing were a problem. His wife was doing everything for him. He had no energy. He had problems with his vision, especially his left eye. He consulted Dr Walsh an ophthalmologist. He is unable to drive a motor vehicle. He suffered from what he described as fits. He was taking Dilantin as an anti epileptic medication for uncontrolled seizures. After awhile he was taken off Dilantin and says that since he has ceased taking anti-epileptic medication his walking has improved. His thinking has become clearer. The symptoms that he was suffering from post-accident were not the same symptoms as he had before the accident.

23 Before his accident he was into various sports such as gliding, badminton, squash and riding horses. He has not been able to do any of those things since his accident. He has tried building model ships but was unable to do it.

24 He is at his best in the early hours of the morning. Sitting cross legged on the ground helped to reduce his ataxia. He has been treated for depression and antidepressants seriously affect his walking.

25 He has used a tens machine from time to time to help with muscle pain in the neck and shoulder. He takes Panadeine Forte for headaches and Imigran for migraine type headaches. He takes Oxazepam to control anxiety and he has had pethidine injections on a couple of occasions when his headaches hang around for more than two weeks.

26 Because of his tendency to fall to the right he has consulted a podiatrist who is trying to minimise the stress fracture. He has had orthotics inserted into his shoes but they have since seemed to be not helpful. At the present time he is using a splint.

27 At the present time he is not bad in the mornings but his fatigue gets worse as the day goes on. He has four children and his condition affects the way he relates to them. He is unable to participate in sports. The way he walks traumatises his children.

28 He has seen a neuro physiotherapist who has tried to control his ataxia problem. He is trying to improve his walking but he has had limited effect.

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29 Dr David Vandermoezel is a general practitioner. Nolan had been a patient of his since October 1992. Dr Vandermoezel reported that in December 1993 and January 1994 he saw Nolan in relation to shakes in his left upper limb. Dr Vandermoezel related those back to Nolan having suffered an electrocution on 13 August 1993 but Dr Vandermoezel did not think that there was any long term sequelae.

30 According to his notes he next saw Nolan on 14 February 1994. At that time Nolan was complaining of lethargy, light-headedness, nausea with occasional vomiting, mild anorexia, cough, low back pain and feeling hot and cold. He also complained of bi-frontal headaches.

31 Dr Vandermoezel was unable to find a cause for those symptoms but ultimately was of the view it related to his loin and lower back and he concentrated on a kidney problem. He referred him to a physician, Dr Klimaitis.

32 Dr Vandermoezel saw Nolan on 9 August 1994 and 28 September 1994. He did not see Nolan again until 22 April 1995 when he saw Nolan at his surgery and had him admitted to the Wanneroo Hospital. At that time his symptoms were similar to those about which he had complained on 14 February 1994. On 22 April 1995 he was also complaining of gastro-enteritis and testicular pain. Dr Vandermoezel diagnosed him as having acute gastro-enteritis and admitted him to the hospital because of dehydration.

33 Over the next two weeks he prescribed antibiotics for Nolan. It was during his period in hospital that Dr Vandermoezel noticed that Nolan had a balance problem. Nolan had told him that his "balance is off". He also said that he suffered air sickness playing video games. Dr Vandermoezel checked his neurological system. He noted that Nolan was unable to maintain his balance with his eyes shut. That in medical terms is having a positive Rombergs test. At that time he considered that Nolan was still suffering the effects of infection. He referred him to a neurologist Dr Goodheart and wrote a letter of referral dated 27 April 1995.

34 Dr A Klimaitis is a consultant physician. He initially saw Nolan on 28 July 1994 and 5 August 1994 upon referral from Dr Vandermoezel because of a number of episodes of febrile illness accompanied by haematuria. At that time Nolan was neurologically intact with preservation of reflexes, motor power and all sensory modalities. There were no involuntary movements noted. His fundi were normal and his cranial nerves were unremarkable.

35 Dr Klimaitis was of the view that his then problems were in no way related to his current neurological deficit. At the time that he saw Nolan in July and August 1994 he was neurologically intact.

36 He re-examined Nolan on 4 March 1998. At that time he had been told that Nolan had suffered two fits within the previous 24 hours. The description of the seizures given to Dr Klimaitis by Nolan's wife was in Dr Klimaitis' view very suggestive of a grand mal fit.

37 On physical examination Dr Klimaitis found no abnormality with Nolan's cardiovascular, respiratory or abdominal systems. Tone in his muscles was probably normal. Reflexes were symmetrically brisk and eliciting the brachioradialis reflex resulted in flexion of the fingertips. The major neurological finding was his abnormal movement. Dr Klimaitis agreed with Dr Gubbay's views that they were almost athetoid in their appearance although they were somewhat more irregular. They seem to be triggered by voluntary movement. They abate when he is lying at rest. He does not have a typical cerebella intention tremor and there was no nystagmus, although while his eyes were fixed laterally there was quite marked movement of his head.

38 Dr Klimaitis was confident that the movements were organic in nature. There was a consistency to them which seems to have been present since the accident. The normal MRI investigations did not sway him unduly.

39 He supported Dr Gubbay's assessment and conclusion. He believed that Nolan had an organic condition which was entirely related to his accident of 24 May 1995 which has resulted in permanent loss of function of his whole body including trunk and limbs. He could not see Nolan making any significant physical recovery at that stage.

40 Dr Ross Goodheart is a Consultant Neurologist. He saw Nolan on 2 May 1995 which was approximately three weeks prior to his accident. His report of 2 May 1995 is in the following terms:

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"Thank you for referring this twenty eight year old Machine Operator for further evaluation of his neurological symptoms. I saw him on the 2nd May, 1995 and he was accompanied today by his wife and two young daughters.

Shaun tells me that he was well until approximately twelve months ago. Since that time he has developed a number of symptoms which have defied specific diagnosis. He tells met that he has been prone to headaches. He describes a predominantly left temporal headache which can spread to involve both occipital head regions. The description of the discomfort is most consistent with muscle contraction component. There can be an associated visual disturbance but this tends to persist for hours. He describes a "smoking" of his vision. The headaches can occur two to three times weekly.

Mr Nolan has also noted intermittent episodes of vertigo. These can occur with head movement or with rest. The vertigo can be associated with nausea. Usually symptoms persist for a minute or two.

In recent weeks Mr. Nolan has been prone to unsteadiness whilst walking. His wife has commented that he appears to be drunk. There has been some associated lower back pain but apparently this has not altered dramatically in recent weeks. There is no radiation of symptoms into the lower limbs.

His other symptoms include some disturbance of urinary control. He finds that he has a tendency to intermittent stream and describes some features that may be associated with retention. There has been no bowel disturbance. He has a tendency to tiredness, lethargy and sweating. He does describe tinnitus.

I note that Mr Nolan underwent a number of investigations looking particularly for a systemic infective illness last year. I understand that these investigations proved to be negative.

Mr Nolan lives with his wife and daughters in Joondalup. Both he and his wife retired from the Navy in 1989. Mr Nolan has been working in the Pilbara as a Machine Operator for a number of years. It seems that he will be facing redundancy in November of this year. He is under a number of stresses and strains but he did not care to elaborate today.

On examination today his heart rate was 72/minute and blood pressure was 120/80. I could not detect any abnormality on general physical examination. His visual acuity was 6/6 in both eyes uncorrected and visual fields were full. Fundoscopy was normal and the pupils were equal and reactive to light and near stimulus. There was a full range of conjugate eye movement. The remainder of the cranial nerve examination was within normal limits. There was a quite reasonable range of neck movement. There was no focal wasting nor weakness of the limb muscle groups. His deep tendon reflexes were symmetrical in the limbs and his formal testing of cerebellar function could not be faulted. When tandem walking there was a tendency to fall to both sides. This was not associated with specific cerebellar disturbance.

I understand that a recent cranial CT scan has been reported as being normal.

I think it is very difficult to determine the cause for Mr Nolan's various symptoms. However there is no specific history or clinical finding to suggest a more sinister underlying neurological problem. I cannot see any specific evidence of cerebellar or vestibular disturbance. His headaches are most consistent with muscle contraction events and I cannot see that they relate specifically to intracranial pathology.

I cannot help thinking, after this single interview, that there is a strong component of Mr Nolan's presentation due to stress. I feel that he may well respond to a short period away from work duties. He may be receptive to more formal discussion of his stresses and strains with a Psychologist or Psychiatrist in the near future.

One can obviously not exclude the possibility of organic disease but it seems that with the investigations that have been performed to date, and the continued normal examination, that Mr Nolan is not suffering from a disorder that would respond to immediate specific treatment.

I would be very pleased to see him again in the next week or so if there is a change in symptomatology or if you feel I could be of further assistance."

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41 Dr Goodheart explained tandem walking as placing one foot in front of the other.

42 Dr Goodheart next saw Nolan on 10 March 1998. In his report of 10 March 1998 he described Nolan as having a rather bizarre gait pattern when he saw him on 2 May 1995. In his report of 2 May 1995 Dr Goodheart makes no reference to a rather bizarre gait pattern. The only reference in his report is that when tandem walking there was a tendency to fall to both sides. He also stated that the examination did not show any definite neurological signs.

43 At his examination on 10 March 1998 Dr Goodheart reported that he found it difficult to reach a definite neurological diagnosis. The only positive finding on examination was that of a movement disorder. The movement disorder did not conform to any of the usual patterns that he was familiar with. He had agreed with Dr Risbey's diagnosis that Nolan was suffering from significant post traumatic stress.

44 In evidence before me Dr Goodheart stated that when he saw Nolan on 2 May 1995 he had problems with coordination both with his hands and with his legs. No mention is made of this in his report of 2 May 1995.

45 In his report of 30 April 1999 Dr Goodheart reported that he saw Nolan on 22 April 1999. At that time taking into account the current history and his physical examination findings it was his finding that there were a number of features that could not be explained on the basis of organic illness. It was Dr Goodheart's opinion that Nolan's movement disorder includes movements that cannot be explained on the basis of any pathology within the brain, spinal cord or peripheral nerves.

46 It was Dr Goodheart's opinion that the accident did not cause or significantly contribute to Nolan's illness.

47 He believed that Nolan's management following the accident has perpetuated the non-organic movement disorder and the pseudo seizures have been maintained.

48 In that report Dr Goodheart stated there was no doubt in his mind that the movement disorder that he recorded on his examination on 10 March 1998 and 22 April 1999 was similar to that demonstrated on his examination on 2 May 1995. I am unable to accept that proposition. Dr Goodheart's report of 2 May 1995 makes no mention of the movement disorder. The movement disorder demonstrated in the videos is so gross that if it existed in that form on 2 May 1995 in my view Dr Goodheart would have been obliged to have commented upon it. Additionally it is most unlikely that Nolan would have been certified as fit to return to work. Nobody suggests that he is fit for work in his present condition.

49 However Dr Goodheart accepted that Nolan had significant problems and that no clinician disagreed with that. The majority of his problems were not explained on a organic basis. He was of the view that Nolan needed a good clinical psychologist and a psychiatrist . His prognosis would depend upon the quality of the immediate treatment supplied by either a clinical psychologist or a psychiatrist.

50 Dr Victor Obiri-Boateng is a consultant psychiatrist. He saw Nolan on four occasions in August and September 1995.

51 He spoke to Nolan about the probabilities of a psychological basis for his ataxia. He also suggested to him that he would need a drug assisted interview to further elucidate any problem areas that could be too painful to talk about but which may shed some light on the possible reason for his truncal ataxia.

52 It is clear from Dr Obiri-Boateng's evidence that he did not reach any firm conclusion in relation to Nolan's condition.

53 Mr Michael Walsh is an Ophthalmic Surgeon. Mr Walsh saw Nolan on 27 October 1995 because of left-sided blurring of vision. It was Mr Walsh's opinion that Nolan's eyes were perfectly normal with no sign of ocular injury or detachment but he had a small latent convergence for distance which may settle down in time. There was evidence of compression injury to the left optic nerve because of the constricted central red field and baring of a slightly enlarged blind spot to smaller targets.

54 It was Mr Walsh's view that Nolan's closed head injury had resulted in a mild optic nerve compression injury with loss of sensitivity of the visual field and damaged the right optic track to produce the left superior quadrantanopia loss of sensitivity, although this was mild. The trunk wobble induces severe irregular head movements and left eye oscillopsia makes it very difficult for him to read and has grossly impaired stereoscopic vision. His loss of body control makes it impossible for him to drive or work and this had led to marked depression.

55 Dr W M Carroll is a Consultant Neurologist. He first saw Nolan on 4 June 1996. Dr Carroll had little doubt that his gait and body movements were a functional disturbance. The question difficult to resolve was whether it was voluntary or hysterical. He was unable to resolve this question at a single review. However he found no loss of sense of smell, vision was normal and there were no definite long track signs or vestibular dysfunction to the then clinical review. Furthermore the movement disorder was not typical of an organic disturbance and certainly not any of the usual forms of choreoathetosis. He did not think that Nolan required any further investigation such as analysis of cough metabolism in view of his clinical findings and an MR study on the 7 August 1995. In view of the history of seizures and visual disturbance he suggested that Nolan have an EEG and a visual evoked potential study.

56 Dr Carroll saw Nolan again on 14 January 1997. There had been no change in his clinical state.

57 Nolan attended on Dr Carroll again on 12 March 1997. He had an alleged seizure a week prior to that date. At that time Dr Carroll found no change in his clinical state on examination. Dr Carroll was of the view that whilst what Nolan described may be a secondary generalised seizure there were a number of features about it which led him to be less than keen to commence anticonvulsant medication. Firstly, the duration of the event itself and the apparent post ictal lack of awareness on his part, although he clearly recalls his wife assisting him to stand and was orientated and aware of where he was together with the unchanged EEG from his previous recording. Consequently Dr Carroll thought it would be prudent for him to have a twenty four or even a forty eight hour ambulant EEG to see if there was any more evidence of epilepsy. The alternative would be that what had occurred was likely to represent convulsive syncope presumably on a vaso-vagal basis.

58 It was Dr Carroll's view that Nolan had a functional disturbance and not an organic disease. Malingering he put to one side. He considered the initial injury was a moderate closed head injury with cerebral contusion and swelling. He did not consider there was much in the way of physical sequela from that injury.

59 Dr Carroll had performed tests that were essentially normal. There was some slow wave activity over the front temporal region. He did not think that the findings were typical of any organic disorder. He did not believe there was any firm evidence of degeneration.

60 He described Nolan's condition as one of the most difficult problems. Nolan would require continuing support. When the litigation was out of the way his condition may improve.

61 Dr Paul Skerritt is a psychiatrist. He saw Nolan on 12 July 1996, 27 August 1996 and 28 April 1997.

62 When Dr Skerrit saw Nolan on 16 July 1996 he was of the view that his gait and rather consistent falling to the right had a functional look to it. He considered that Nolan was suffering from anxiety and depressive symptoms.

63 Dr Skerrit did not have an opportunity to complete his assessment and he was happy to defer to Dr Risbey's opinion.

64 Dr Lance Risbey is a specialist psychiatrist. Dr Risbey first saw Nolan on 22 August 1996 for assessment of psychiatric consequences of his accident on 24 May 1995.

65 It was Dr Risbey's view that the head injuries that Nolan had received at the time of the accident had resulted in a complex and confusing picture which had included post trauma convulsions and a severe difficulty with co-ordination and gait. Nolan was unable to stand or to walk normally, tending to fall over every moment and having to correct his gross movement. Dr Risbey's early assessment of the movement disorder was that it was of psychological origin ie. a conversion disorder. However recent neurological opinion indicated that it most likely originated from damaged nerve fibres carrying proprioceptive signals in the region of the upper spinal cord and brain stem.

66 Although Dr Risbey's early assessment was that the movement disorder was a conversion re-action he was now of the view that it was organically based. He was of the view that the movement disorder was far too consistent for a conversion disorder and his view was effected by Dr Gubbay's opinion of damage to the nerve fibre. It was on that basis that he moved to an organic cause.

67 From a psychiatric point of view Dr Risbey was of the opinion that Nolan suffers from a severe and chronic post-traumatic stress disorder. Nolan's post-traumatic stress disorder would not improve even with ongoing treatment. Dr Risbey was of the view that his post-traumatic stress disorder had stabilised in such a way that it was quite disabling, even without his more disabling symptoms of incoordination.

68 Dr Risbey was of the view that post traumatic stress disorder alone would make work very difficult but not impossible.

69 Dr Sasson Gubbay is a Neurologist and Clinical Professor of Neurology.

70 Dr Gubbay first saw Nolan on 30 June 1997. At that time Dr Gubbay believed that Nolan's neurological disturbance with involuntary movement, loss of balance and other symptoms were of organic nature. He described the involuntary movements as unusual and he had not quite seen that type of movement disorder previously. However he thought that it did correspond to "pseudo-athetosis" which is basically an involuntary movement caused by loss of proprioception. He considered that the most likely cause for this apparent loss of proprioception and subsequent pseudo-athetosis and loss of balance is a high cervical spinal cord injury and he believed that would account for the temporary respiratory failure which was responsible for him having to be in the intensive care department at Sir Charles Gairdner for a few days after a latent period of a few days following his injury. He suspected that there could well have been swelling of the spinal cord which got worse a few days after the injury and caused the exacerbation of his condition including respiratory failure.

71 Dr Gubbay was of the view that Nolan was severely disabled and in very great need of rehabilitation. He certainly needed to be under the care of skilled physiotherapy and occupational therapy and be given every assistance to allow for better ambulation. He considered that he also needed to have a well designed wheel chair.

72 He was unsure as to what his seizures really were. It was possible that they were pseudo-seizures because of the intense emotional strain that Nolan is under. Despite the normal EEG's Dr Gubbay thought it also possible that the seizures were of organic nature and of an epileptic origin.

73 Following a further review of the evidence Dr Gubbay reported on 11 May 1998 that he had still come to the conclusion that Nolan had an organic condition affecting his balance and gait which causes his involuntary movements and his episodes of collapse. It seems likely that there was a pre-existing neurological condition prior to the accident and which is of relevance to his current condition. Although Dr Goodheart considered that the neurological presentation prior to the accident was non-organic at that time, and also in retrospect believes that it was non-organic as he obviously suspects the current situation also to be non-organic, Dr Gubbay believed there may well have been elements of a neurological disturbance before the accident. It appears that the accident would have caused a gross exacerbation of what was actually present prior to the accident.

74 Dr Gubbay accepted that it was difficult to try to sustain an argument for organic neurological disease when there is no support for it on collateral examination including repeated EEG, repeated MRI scanning of the brain and spinal cord and repeated cortical evoked potentials, particularly somatosensory potential. However, against all this lack of evidence he felt that the condition is organic.

75 Dr Gubbay last saw Nolan on 10 March 1999 and adhered to his view. Dr Gubbay accepted that if Nolan had a neurodegenerative condition he would expect to see aggression but that he had not seen that.

76 He was of the view that true epileptic fits had been diagnosed. He did not think that Nolan had a conversion disorder.

77 Dr Zelko Mustac is a consultant psychiatrist. He saw Nolan on 6 December 1996 for assessment.

78 It was Dr Mustac's evidence that Nolan presented in a very dramatic manner. He looked likely to fall to the right and throughout the interview maintained an abnormal movement order. He considered that Nolan had a psychiatric condition which he diagnosed as a conversion disorder. He did not see any evidence of depression or anxiety. It was his view that an amatol interview could help in resolving the problem and open Nolan up to effective treatment. He described a conversion disorder as being a mental disorder which affected every system.

79 He did not consider that Nolan was suffering from a post traumatic stress disorder.

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80 Nolan claims damages for loss of amenities being pain and suffering and loss of enjoyment of life both past and future.

81 It is clear from the evidence that on 24 May 1995 Nolan suffered a closed head injury. It caused him to be hospitalised for a period of some three weeks. Since that time his main problems appear to have been a movement disorder and what he describes as fits or seizures. Despite having a large battery of tests and seeing a large number of specialists there is still no general agreement on what was the cause of Nolan's problem.

82 From the point of view of a lay observer the biggest disability is the movement disorder. It appears to affect everything that he does. It was very apparent during the course of the court proceedings and whilst he was in the witness box. His appearance was consistent with video evidence tendered by Hamersley. There is no suggestion that Nolan is faking the movement disorder or that he is malingering. Whatever the cause of his problems it is accepted by all medical experts that he has a severe problem.

83 The first question that needs to be determined is whether or not the movement disorder is organic or non-organic. Evidence supporting an organic cause comes from Dr Gubbay, Dr Klimaitis and Dr Risbey. Both Dr Klimaitis and Dr Risbey were influenced principally by the appearance of Nolan's movements and were unable to point to any conclusive neurological evidence. Dr Gubbay conceded that his opinion was speculative in the absence of test evidence and also conceded that a diagnosis of a conversion disorder was a possibility.

84 There is a substantial body of evidence supporting the non-organic cause. The MRI and CT scans of the brain and spinal cord (including 2 May 1995) are clear apart from evidence of "very slight diffuse swelling" on the CT scan of 26 May 1995. Dr Carroll's evidence was that this resolved in due course and was temporary in nature. EEG's have been either normal or shown no avert electrical evidence of epilepsy. Comprehensive tests by a consultant neurologist at Sir Charles Gairdner Hospital and Royal Perth Hospital have disclosed no neurological abnormality. Nolan's condition has not improved since the accident as it should have if he had suffered brain damage. See Dr Gubbay T316-7.

85 Dr Mustac diagnosed a functional disorder as did Dr Risbey after the first eighteen consultations. It was not until Dr Gubbay made his original diagnosis of cervical spinal trauma that Dr Risbey altered his view. Dr Skerritt also considered that a functional disorder was possible. Both Dr Carroll and Dr Goodheart ruled out any organic cause.

86 The question of whether or not his disorder is organic or non-organic calls for neurological specialisation. In this respect I prefer the views of Dr Carroll and Dr Goodheart to that of Dr Gubbay. The weight of the evidence in my view points to the movement disorder as being of a non-organic origin. That is not to say that the movement disorder is not a serious problem for Nolan and all medical experts of whatever view as to whether it is an organic or a non-organic cause accepted that Nolan has a serious problem.

87 Further in my view the movement disorder that Nolan has displayed since his release from hospital after his accident is different to the problems that he had before the accident. It is clear from the evidence that Nolan had some sort of a balance problem before the accident but there is no suggestion he was not capable of working and it is not suggested by anybody except Dr Goodheart that he displayed the movement disorder that he displayed post accident. I have already discounted Dr Goodheart's evidence in that respect. Nolan's current movement disorder is very obvious to the lay observer. If the movement disorder pre-existed the accident then clearly that would have been reported on either by medical practitioners or by his family or by people observing him at work. None of those things happened. In my view the movement disorder follows the accident and results from the accident.

88 If the movement disorder is not organic then the psychiatric evidence is that it is a conversion disorder. This is a recognised psychiatric condition. Dr Risbey described such a condition as a subconscious defence mechanism against stress and other issues.

89 There is evidence that the movement disorder manifested by the condition is treatable. That was the effect of Dr Mustac's evidence and Dr Risbey's evidence. Both Dr Obiri-Boateng and Dr Mustac recommended a drug assisted interview. Dr Risbey recommends EMDR therapy but has used drug assisted interviews successfully in the past.

90 Having come to the conclusion that Nolan's movement disorder is non-organic I am also of the view that Nolan's fits or seizures are pseudo seizures possibly from a dissociative reaction to stress and not epileptic seizures. I have come to this conclusion largely on the same basis that I come to the view that the movement disorder is non-organic. But in addition to that in my view there is insufficient evidence of true epileptic activity. Nolan is not and has not been taking for a considerable period of time any anti-convulsant medication. There are atypical characteristics to Nolan's seizures: see for example Risbey's report dated 20 January 1998 at p7.

91 There is no medical evidence that Nolan loses consciousness during a fit or that he is at risk when asleep.

92 Furthermore the evidence suggests that the frequency of pseudo seizures has increased with the build up of momentum in Nolan's legal case. There is an absence of contemporaneous evidence of seizures between the time that Nolan was discharged from Sir Charles Gairdner Hospital and early in 1997.

93 The next question to determine is whether Nolan suffers from post traumatic stress disorder.

94 It is clear that Nolan suffered from considerable stress prior to his accident. Dr Goodheart's report of 2 May 1995 indicates that Nolan told him that he had been working in the Pilbara as a machine operator for a number of years and that he would be facing redundancy in November of that year. He stated that he was under a number of stresses and strains but did not care to elaborate. Dr Vandermoezel's evidence would indicate that there was considerable stress on the part of Nolan. Nolan's father Mr Richard Nolan gave anecdotal evidence of stress that he observed in Nolan. Dr Klimaitis's report of the 28 July 1994 suggested that a depressive illness should be kept in mind.

95 The evidence would indicate that the stress produced significant symptoms but no organic diagnosis was made. It did cause Nolan to take some periods of time off work the last of which was for three weeks just prior to the accident.

96 Nolan's working future was uncertain. He did not want to continue working in the north west and told Dr Goodheart on 2 May 1995 that he was facing redundancy in November 1995.

97 Nolan has been under stress since the accident but not necessarily due to the accident per se and in my view not to the extent of having post traumatic stress disorder. That is a stress disorder meeting the criteria in DMS-IV. Significant stresses for Nolan have included the medico legal issues see for example Dr Gubbay's evidence transcript p305 and Dr Risbey's report dated 20 January 1998 at p10 and transcript p262. It also clear that he has been dissatisfied with the medical system. Hamersley on one occasion ceased his weekly payments of workers' compensation in December 1997 (see Dr Risbey's report dated 20 January 1998 at p7). It is also clear that Nolan has reacted to his movement disorder.

98 Dr Risbey's view was that Nolan suffered from severe and chronic post traumatic stress disorder. His disorder did not improve even with ongoing treatment. On the other hand Dr Mustac is of the view that Nolan did not suffer from post traumatic stress disorder. It was his evidence that the absence of emotional numbing, nightmares, distancing from others and his reduced interest in activities were contra indicative of post traumatic stress disorder.

99 I prefer the evidence of Dr Mustac in this respect. The surrounding evidence would indicate that Nolan is able to participate in normal activities. His problem in my view is entirely related to the conversion disorder.

100 It is also clear that resolution of this litigation will remove significant stresses and assist focused psychotherapy: see Dr Risbey's report dated 20 January 1998 at p12.

101 My findings therefore are the main problems suffered by Nolan arising out of the accident are the movement disorder and the pseudo seizures. These arise out of his conversion disorder which is a recognised psychiatric condition. It is clear that these matters have arisen since his accident and to date there has been no improvement. The evidence is to the effect that these matters are treatable. There is not a lot of evidence as to how and when they could be treatable and the prospects of success. The rest of Nolan's other complaints are in my view stress related. Although he complained of pain in his neck and back he told me that these matters paled into insignificance along side his movement disorder.

102 It is my finding that his condition is likely to improve after the litigation in any event. It is also the case that some time in the future his condition is treatable.

103 Clearly his condition has seriously affected his lifestyle since his accident and it is likely to be the case for the foreseeable future.

104 In respect of loss amenities being pain and suffering and loss of enjoyment of life both past and future I allow the sum of $75,000.

105 Special damages (including past travelling expenses agreed in the sum of $1,307) are agreed at $71,300.41 and I allow that sum.

106 Future travelling expenses are agreed at the sum of $3,400 and I allow that sum.

107 Nolan claims future medication and pharmaceutical expenses in the sum of $22,658. That is made up on the basis that he will require Panadeine Forte, Imigran, Oxazepan, occasional pethidine injections and Tens Machine Pads at a rate of $120 per month for the remainder of his life.

108 There is considerable exaggeration in this claim in my view. The evidence of Dr Vandermoezel was that Nolan did not need pethidine injections and that he does not use a Tens machine. Evidence from Nolan on these aspects was also in my view unsatisfactory. The claim for Panadeine Forte and Imigran are for headaches. It was the submission of Hamersley that they relate entirely to a pre-existing condition. I accept that proposition in part. It is difficult to see how those pharmaceuticals assist with Nolan's problems but I accept that he is likely to remain on medications for some time. Hamersley accepts that there is some requirement for Oxazepan. The future with respect to these matters is uncertain. I propose to allow Nolan $5,000 in respect to future pharmaceutical expenses. It is clear that he requires considerable psychiatric assistance and presumably medications will arise from that treatment.

109 Nolan claims future general practitioner attendance expenses in the sum of $6,512 on the basis of an agreed rate of $414 per annum for the remainder of his life. Hamersley accept the claim for general practitioner expenses in the sum of $414 per annum for the next ten years principally related to management of stress and the movement disorder. In my view that is reasonable. I allow this item as follows:

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127 Nolan claims future lawn mowing/gardening expenses in the sum of $5,726 calculated at an agreed rate of $28 per month ($7 per week) for the remainder of his life (42 years - multiplier 818).

128 I am unable to find any submissions on the part of Hamersley in respect to this item. In my view the figures are reasonable but I would reduce that by 40 per cent for contingencies. I allow the sum of $3,435.

129 Nolan claims past loss of income earning capacity. The agreed amount for past loss of earning capacity up to 17 March 1999 is $157,935.32.

130 Nolan claims loss of income - earning capacity from 18 March 1999 to 10 June 1999 (12 weeks) at the rate of $582.46 net per week being a total of $6,989.52 net. I also allow that sum.

131 The total of those figures is $164,942.84 and I allow that sum.

132 Nolan claims future loss of income/earning capacity in the sum of $440,747.48 (less discount for any retained earning capacity and contingencies calculated at a rate of $41,600 gross per annum being $582.46 net per week to aged 65 - multiplier 756.7).

133 It is the submission of counsel for Hamersley that Nolan may not have been working as a rail grinder at the present time but for the accident, that he may not have been working for Speno at this time but for the accident and that his potential income in any other occupation for which he was reasonably qualified ranged between about $20,000 gross to less than $41,600 gross per annum and submits a figure of $35,000 gross per year or $508 net per week should be the starting point.

134 I do not accept this submission. The evidence indicates that Nolan had been working for Speno for some years at the time of his accident. He had a demonstrated capacity to earn the amount claimed by Nolan. In fact that rate is calculated at the time that he had his accident in 1995 and has not been increased for pay rises or other matters. There is some suggestion on the evidence that Nolan may have gone on to bigger and better things with Speno. In any event that is the capacity which he has demonstrated and in my view it is a fair figure on which to assess future loss of earning capacity.

135 I accept in the circumstances that the starting point is the figure of $440,747.48.

136 In view of my findings that Nolan's disability is the result of a psychiatric condition and that the condition is treatable I am of the view that figure should be discounted by 40 per cent for contingencies. I allow the sum of $264,448 for future loss of income/earning capacity.

137 Nolan claims past loss of superannuation in the sum of $11,394 based on the report of Mr William M Mercer dated 25 February 1999.

138 Actuarial evidence of Nolan's loss of superannuation benefits is inconsistent with the approach in Jongen v CSR (1992) Aust Torts Reports 81-192. I assess Nolan's past loss of superannuation benefits according to the formula in Jongen as follows:

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181 The first issue in relation to this exclusion clause is whether there was a statutory obligation to effect insurance in relation to the vehicle. Clearly there was. (See s4, s6 of the First Schedule Motor Vehicle (Third Party Insurance) Act 1943, s18, Road Traffic Act 1974).

182 It is submitted by counsel for Zurich that the defences of Hamersley and Speno contend that the obligation to insure must refer to an obligation on Hamersley to insure, but that is to read words in which are not in the clause. The exclusion clause is not concerned with who has to insure the vehicle but merely that the vehicle is one which is required to be insured by someone. The identity of the person obliged is irrelevant. If the vehicle is one which is required to be insured, then the exclusion clause will operate.

183 Alternatively, if the court accepts Hamersley and Speno's contention that the obligation referred to an obligation on the "insured" then the reference is to Speno and not to Hamersley, this on the reasoning in Fletcher Organisation Pty Ltd v CML (1987) 4 ANZ Ins Cas 74, 920.

184 The exclusion refers to "personal injury .... caused by any vehicle". The words "caused by" connote a "direct or proximate relationship": Dickinson v MVIT and SGIC v Sinfield Pty Ltd (supra). In my view the proximate cause of the accident was the negligence of Hamersley. (See agreed facts, para 13). The proposition that the accident was "caused by" the negligence of Hamersley in allowing the points to change, is consistent with the proposition that the accident also "arose out of" the performance by Speno of the contract.

185 In my view Zurich's contention that the vehicle was the proximate cause of the personal injury is too literal and restrictive. That argument directs attention to the motor vehicle as the instrument of the injury and not the true "proximate cause" or "effective or dominant cause of the occurrence". The cause of the accident (and hence Nolan's injuries) was the negligent changing of the points and not the driving of the vehicle.

186 In my view the purpose of the exclusion is to exclude indemnity in circumstances where a compulsory vehicle insurance would respond, ie. where the insured is the owner or driver of the vehicle concerned. Such is not the case in this matter.

187 In my view the vehicle statutory insurance exclusion to does not apply to either Hamersley or Speno.

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189 It is the submission of counsel for Zurich that on the authority of Fletcher Organisation Pty Ltd v CML (1987) 4 ANZ Ins Cas 74, 920, the reference to the word "insured" must be read as a reference to Speno. The injury was to a person in the service of Speno, and therefore the exclusion clause applies to exclude liability under the general liability policy.

190 Hamersley and Speno contend that Hamersley was the "insured" and Nolan was not in the employment of Hamersley and therefore the exclusion clause does not apply. It is the submission of counsel for Zurich that the policy cannot be read as though Hamersley was the primary "insured". The insured is defined in definition sub-clause (a). Hamersley is only the "insured" because of sub-clause (c), ie. it is a principal nominated for the purpose of the policy. (See also the endorsement).

191 It is impossible to simply insert "Hamersley" whenever the word "insured" occurs elsewhere in the policy. (See, for example, the definition clause which defines "the insured".) Furthermore the right to cancel the policy is given to the "insured" - see condition 10. It must surely be a right given to Speno and not to Hamersley (which was the conclusion reached in the Fletcher Organisation case claim). Furthermore it would have been unnecessary in clauses 5 and 7 to have referred to "the insured or other person insured".

192 Furthermore both Hamersley and Speno plead that the ensuing clause where it refers to the "insured" refers to Speno, and not to Hamersley. (See para 12 of Speno's statement of claim (p27 of Papers for the Judge) and clause 8.2 of Hamersley's statement of claim (p35 of Papers for the Judge).

193 Clause 14 - the separate policy clause - is only inserted to make it clear that the insured are not jointly insured.

194 It is the submission of counsel for Hamersley that Zurich admits that the definition of "the insured" includes any principal. (See defence para 8.3(a)(ii)). Clause 14 (the cross liability clause) provides that the word insured shall apply to each party as if a separate policy had issued to, in this case Hamersley. Thus reference to the insured in exclusion 1(a) is reference to Hamersley and accordingly the exclusion is not applicable because Nolan was not an employee of Hamersley.

195 The clause clearly directs that the word "insured' is to be read as if it applied to Hamersley "as if a separate policy had been issued" to Hamersley. The **Fletcher Organisation Pty Ltd v CML Fire and General Insurance (**supra) is distinguishable, as it did not contain a cross liability clause in these terms.

196 The anomalies referred to by Zurich are not anomalies at all. For instance, Hamersley could cancel the policy deemed to have been issued to it pursuant to the cross liabilities clause without affecting in way the policy deemed to have been issued to Speno.

197 In my view the submissions of counsel for Zurich are correct. The Fletcher Organisation Pty Ltd v CML authority is clear. In my view the reasons for the decision are unaffected by the fact that there was not a cross liability clause in the policy.

198 It follows in my view that the employer's liability exclusion in the general liability policy applies to both Hamersley and Speno.

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206 Question 9 of the umbrella proposal asked whether Speno had workers' compensation insurance, and this was answered "yes" (exhibit 20 p168).

207 Question 16 provided a schedule of policies to be incorporated into the umbrella policy, and relevantly under (c) there appears a reference to a workers' compensation - employer's liability policy with the words "currently unlimited" and a reference to the "CIC" policy (exhibit 20 p180).

208 Clause 37(a)(i) of contract HS-1243 informed Zurich that Speno had promised to be solely liable for, and to indemnify Hamersley against, any claim or action arising at common law in respect of personal injury resulting either directly or in consequence of the performance of the Work/Services under contract HS-1243.

209 Clause 38(a)(i) and clause 38(e) of contract HS-1243 obliged Speno to secure a workers' compensation policy.

210 Clause 38(a)(vii) of contract HS-1243 informed Zurich that Speno promised to "ensure that any policy of worker's compensation insurance taken out by (Speno) to cover Works/Services performed pursuant to the contract shall be endorsed to indemnify (Hamersley) against any and all liability (Hamersley) may have...at common law".

211 It is the submission of counsel for Zurich that the reasonable conclusion based on all of the above information was that Speno, in compliance with its contractual promises in clauses 37 and 38, and having taken out a workers' compensation policy with CIC (as it was obliged to under contract HS-1243) arranged to endorse the policy to provide unlimited common law cover in favour of Hamersley to protect it against claims of the kind brought by Nolan in this case.

212 Section 21, Insurance Contracts Act imposed a duty on Speno to disclose to Zurich before the umbrella policy was entered into, every matter known to Speno being a matter that it knew being a matter relevant to the decision of the insurer whether to accept the risk or that a reasonable person in the circumstances could be expected to know to be a matter to be so relevant.

213 A reasonable person in the position of Speno could be expected to know that it was highly material to disclose to Zurich that if Speno was in breach of its contract and had not endorsed the CIC policy in favour of Hamersley that Zurich be told of such facts.

214 If the umbrella policy responds to the claim (contrary to the earlier submissions), then Speno's failure to make disclosure has greatly increased Zurich's risk and exposed it to liability it should not have had to face.

215 There was no incompleteness in the answers which would bring s21(3) of the Insurance Contracts Act into operation.

216 The remedy for non-disclosure set out in s28(3) of the Insurance Contracts Act and the liability in this case should be reduced to nil because if disclosure had been made then Zurich would have enquired whether Speno was going to comply with its contractual promises and if not to then exclude liability for the kind of claim brought by Nolan in this case: FAI General Insurance Co Ltd v Hendry Rae & Court (1993) 10 WAR 322 at 337-338.

217 So far as Hamersley is concerned, and if Hamersley is not a party to the policy, then s48(3) of the Insurance Contracts Act specifically confers the same defences to an action by Hamersley as it would have had in an action by Hamersley if it had been a party to the policy: C E Heath Casuality and General Insurance Ltd v Grey (1993) 32 NSWLR 25.

218 Alternatively, if Hamersley is a party to the policy then it has ratified the actions of Speno and the broker in arranging the insurance which it now sues upon.

219 It is the submission of counsel for Hamersley that the nature of the CIC insurance was fully disclosed because:

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220 Therefore Zurich is deemed to have waived compliance with the duty of disclosure: see s21(3), Insurance Contract Act.

221 It is further said that any reliance by Zurich was not reasonable and Zurich is not entitled to relief under s28(3), Insurance Contract Act, or s87, Trade Practices Act.

222 In my view the submissions made by counsel for Zurich that a reasonable person in the position of Speno could be expected to know that it was highly material to disclose to Zurich that if Speno was in breach of the contract and had it not endorsed the CIC policy in favour of Hamersley that Zurich be told of such facts.

223 If the CIC policy had been endorsed in favour of Hamersley then Zurich would not have been involved in this action. If the employer's liability under the CIC policy is unlimited the umbrella policy would not need to be used to top up insurance under the policy and neither would it need to drop down to act as primary policy.

224 I accept the proposition that Speno's failure to make disclosures greatly increased Zurich's risk and exposed it to liability it should not have had to face.

225 However I accept the submissions of counsel for Hamersley that the answers to relevant questions in the umbrella liability proposal were obviously incomplete.

226 The proposal (including the underwriting information) did not state that the CIC policy was extended to Hamersley for personal injuries suffered by Speno's employees. The proposal merely stated that Speno held a policy of compulsory statutory workers' compensation insurance with CIC in accordance with the Workers' Compensation and Rehabilitation Act of Western Australia with unlimited indemnity for common law liability.

227 In my view the proposal and underwriting information should have included a copy of the CIC policy. It would be immediately apparent that the policy had not been extended to cover Hamersley for personal injuries suffered by Speno's employee. The fact that the CIC policy was not included with the proposal and underwriting information in my view required Zurich to call for the policy. Zurich did not do that and in my view is the author of its own misfortune.

228 For these reasons I am of the view that Zurich is deemed to have waived compliance with the duty of disclosure: s21(3) of Insurance Contracts Act.

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (141 paragraphs)

Nolan v Hamersley Iron Pty Ltd & Ors [1999] WADC 18 (5 August 1999)

Parties

Legislation Cited (5)

Cases Cited (13)