Paper Coaters Pty Limited v Jessop

Paper Coaters Pty Limited v Jessop - [2009] NSWCA 1 - NSWCA 2009 case summary — Zoe

[26]

14 The orders proposed by Bell JA should be made. 15 BELL JA: On 31 July 2003 the respondent, Anthony Jessop, sustained an injury in the course of his employment with the appellant, Paper Coaters Pty Limited. He commenced proceedings in the District Court claiming damages arising out of his injury which he alleged was caused by the negligence and/or breach of statutory duty of the appellant. Under the scheme of the Workers Compensation Act 1987 (NSW) ("the 1987 Act") and the Workplace Injury Management and Workers Compensation Act 1998 (NSW) ("the 1998 Act") (collectively, "the Workers Compensation Acts") the claim is for work injury damages. The respondent's entitlement to bring the claim under the common law is preserved by s 151 of the 1987 Act, subject to the procedural requirements of Pt 6 of Ch 7 of the 1998 Act: see, generally, Berowra Holdings Pty Ltd v Gordon [2006] HCA 32; (2006) 225 CLR 364. References to statutory provisions in these reasons are to the 1998 Act unless otherwise stated. 16 Part 6 of the 1998 Act deals with court proceedings for work injury damages and Div 3 contains a regime for the service of pre-filing statements and defences thereto. A claimant is obliged to refer his or her claim for mediation before the commencement of court proceedings. The pre-filing statement and the pre-filing defence are required to set out particulars of the claim or defence and the evidence that is to be relied on. Neither party may lead evidence in subsequent court proceedings that was not disclosed in the pre-filing statement or defence without leave. The evident purpose of the scheme is the encouragement of the early settlement of claims without recourse to proceedings in a court. 17 Strict time limits are imposed on defendants with respect to the service of the response to the pre-filing statement. A defendant who fails to respond by serving a defence within 42 days of the service of the pre-filing statement is precluded from filing a defence disputing liability in subsequent court proceedings: s 318(1)(c). 18 Those paragraphs of the appellant's defence by which it disputes liability in the District Court proceedings have been struck out under s 318(1)(c). It is this determination that is the subject of the appeal. 19 On 1 June 2006 the respondent's solicitors served a pre-filing statement on the appellant. The pre-filing statement included copies of medical reports. It identified a number of documents, including the respondent's statement, which were "to be provided". The appellant responded to the service of the pre-filing statement by serving a pre-filing statement for the defendant (Exhibit "A"). In pars 2 and 3 of the draft defence that formed part of the statement, it denied liability for the respondent's injury. Exhibit "A" is undated but it was not in issue that it was served within 42 days of the service of the pre-filing statement. The respondent's claim was referred for mediation. The mediation, which took place on 12 September 2006, was unsuccessful. The pre-conditions for the commencement of court proceedings for the recovery of work injury damages were satisfied. In the event, court proceedings were not then commenced. 20 On 23 March 2007 the respondent's solicitors served a document titled "second pre-filing statement" on the appellant. The draft statement of claim that was attached to it claimed damages arising out of the same injury and on the same particulars of negligence (and additional particulars) as the draft pleading that was attached to the earlier pre-filing statement. The appellant did not respond to the second pre-filing statement by serving a further pre-filing defence under s 316(1) within 42 days. 21 The respondent's statement of claim was filed in the District Court on 23 May 2007. On 5 July 2007 the appellant filed a defence, which was in the same terms as the draft defence in Exhibit "A". The respondent filed a notice of motion claiming an order striking out those paragraphs of the defence by which the appellant denied negligence or breach of statutory duty, on the basis that no pre-filing defence had been served. The motion came before Judicial Registrar McDonald, who held that the first pre-filing statement was defective and that the second pre-filing statement complied with Pt 6. Since the appellant had not responded to the second pre-filing statement within 42 days the Judicial Registrar held that it was precluded from filing a defence disputing liability. 22 By amended notice of appeal the appellant seeks leave to appeal against the orders of the Judicial Registrar. The amended notice challenges the determination on 9 grounds, which involve substantial overlap. In the written submissions filed on the appellant's behalf the challenge was distilled into the following three questions: (a) Whether Section 315 of the Act allows multiple pre-filing statements to be served so as to defeat an earlier valid pre-filing defence. (b) Whether the Judicial Registrar acted Ultra Vires her powers. (c) Whether a pre-filing defence served within time protects a defendant from any subsequent pre-filing statement. 23 Mr S G Campbell SC, who with Mr A Reoch appeared for the respondent, did not oppose the grant of leave. It is appropriate that leave be granted.

[27]

24 The 1987 Act is to be construed as if it formed part of the 1998 Act: s 2A(2) of the 1987 Act. In the event of an inconsistency between the two Acts, the 1998 Act prevails to the extent of the inconsistency: s 2A(3) of the 1987 Act. It is necessary to refer to a number of provisions of the Workers Compensation Acts in order to understand the scheme. 25 Section 151D of the 1987 Act provides that a person to whom compensation is payable under the 1987 Act is not entitled to commence court proceedings for damages in respect of the injury against the employer liable to pay that compensation more than three years after the date on which the injury was received, except with the leave of the court in which the proceedings are to be taken. 26 Relevantly, s 151DA of the 1987 Act provides: 151DA Time not to run for commencement of proceedings in certain cases (1) Time does not run for the purposes of section 151D: (a1) while the determination of the claim concerned is delayed as permitted by section 281 of the 1998 Act, but not including delay beyond two months after the claimant has provided all relevant particulars about the claim as required by section 281(2)(b) of that Act, or Note . Delay in determining a claim beyond 2 months is only permitted on the basis that degree of permanent impairment is not fully ascertainable and the insurer has notified the claimant of this. In such a case, paragraph (a) of this subsection can apply (if a dispute about whether degree of permanent impairment is fully ascertainable is the subject of medical assessment) to further prevent time running for the purposes of s 151D. (a) while a medical dispute as to whether the degree of permanent impairment of the injured worker is at least 15%, or whether the degree of permanent impairment of the injured worker is fully ascertainable, is the subject of a referral for determination by the Commission or a referral for assessment under Part 7 of Chapter 7 of the 1998 Act (including any further assessment under section 329 of the Act), or … (b) while a pre-filing statement served in accordance with section 315 of the 1998 Act in respect of the claim concerned remains current. (2) A pre-filing statement remains current from the time it is served until it is struck out under this section on the application of the person ( the defendant ) on whom it was served or it is withdrawn by the person who served it, whichever happens first. (3) The defendant may apply to the President to have the pre-filing statement struck out by order of the President. Such an application may not be made until at least 6 months have elapsed after the defendant served on the claimant a defence to the claim in accordance with section 316 of the 1998 Act. (4) The President may order that a pre-filing statement be struck out but must not do so if satisfied that the degree of permanent impairment of the injured worker is not yet fully ascertainable and the matter is the subject of a referral under Part 7 of Chapter 7 of the 1998 Act for assessment of the degree of permanent impairment of the injured worker. 27 The procedural provisions dealing with claims for work injury damages are found in Ch 7 of the 1998 Act. They include the requirement for prompt notice of the injury to the employer: s 254(1). The person on whom the claim for work injury damages is made is required to determine the claim by accepting liability and making a reasonable offer of settlement to the claimant or disputing liability: s 281(1). A claim must be so determined within one month after the degree of permanent impairment first becomes fully ascertainable or within two months after the claimant has provided to the insurer all relevant particulars about the claim, whichever is the later. The relevant particulars about a claim are full details of the matters set out in s 282(1)(a) - (g) sufficient to enable the insurer, as far as practicable, to make a proper assessment of the claimant's full entitlement on the claim.

[34]

(1) A claimant must refer a claim for work injury damages for mediation under this Division before the claimant can commence court proceedings for recovery of those work injury damages. The claim cannot be referred for mediation until at least 28 days after the pre-filing statement has been served on the defendant under Division 3. (2) The claimant need not refer a claim for work injury damages for mediation if the defendant has failed to respond to the claimant's pre-filing statement as required under Division 3 within 42 days after it is served on the defendant. Note . A defence can still be filed in the 28-42 day period. A defence can be filed after 42 days but such a defence cannot dispute liability. A defence filed after 42 days can deal with such matters as quantum of damages or contributory negligence. (3) The defendant may decline to participate in mediation of the claim if the defendant wholly disputes liability in respect of the claim, but in any other case the defendant cannot decline to participate in mediation. (4) Court proceedings for recovery of work injury damages cannot be commenced while the claim is the subject of mediation in the Commission. (5) A claim is referred for mediation by being referred to the Registrar for mediation by a mediator. The Registrar is to give directions as to which mediator is to mediate on a particular claim referred for mediation. (6) The Rules may make provision for or with respect to mediation under this Division. 30 Section 364(1) confers a general rule making power on the Minister. Reference is made in the Judicial Registrar's judgment to the Workers Compensation Commission Rules 2006, which deal with the content of the pre-filing statement and response under ss 315(1) and 316(1). These Rules applied at the date of the "second pre-filing statement". They replaced the Workers Compensation Commission Rules 2003 with effect from 1 November 2006. The 2003 Rules applied at the date the pre-filing statement and the appellant's response to it were served. Nothing turns on this circumstance, since the 2006 Rules relating to pre-filing statements are in the same terms as the 2003 Rules. 31 It is to be noted that the Rules to which reference was made were not introduced as part of the scheme for the "new claims" procedures at the time Ch 7 was introduced into the 1998 Act. Chapter 7 commenced on 1 January 2002, at which time the Interim Workers Compensation Commission Rules 2001 came into operation. Those Rules made provision, inter alia, for the claimant and defendant to lodge with the Commission a certificate in an approved form certifying service of the pre-filing statement/defendant's response within two days of causing the same to be served: r 52(3) and r 54(3). Neither the 1998 Act nor the current Rules make provision for certification of service of the pre-filing statement and response. 32 The provisions of the Workers Compensation Commission Rules 2006, to which the Judicial Registrar referred, are set out below: 17.3 Pre-filing statement

[39]

(1) A claimant who has been notified in accordance with section 317 (1) of the 1998 Act in respect of the claimant's pre-filing statement must, within 7 days of being so notified, serve on the defendant advice as to whether the claimant accepts or denies that the pre-filing statement is defective, and in what detail and to what extent. (2) Where a claimant has served advice in accordance with subrule (1) and has not, within 7 days of that service, been notified by the defendant that the defendant no longer alleges that the pre-filing statement is defective, the claimant must lodge: (a) a copy of the pre-filing statement, and (b) a copy of the defendant's notification and the claimant's advice referred to in subrule (1), and (c) a request that the dispute be referred to the Registrar for determination under section 317(2) of the 1998 Act, and on the same day serve the request on the defendant. (3) Where a claimant does not comply with subrule (1), or, where subrule (2) applies, the pre-filing statement is taken not to have been served. (4) Where a claimant requests in accordance with this rule that a dispute be referred to the Registrar for determination under section 317(2) of the 1998 Act, and lodges a certificate certifying service of the request on the defendant within 2 working days of that service, the dispute is so referred. (5) Where a dispute is referred for determination in accordance with subrule (4) and the Registrar determines that the pre-filing statement is defective, the pre-filing statement is, in accordance with section 317(4) of the 1998 Act, considered to have been served on the date of service on the defendant of the last document or information required to cure the defect. (6) Where a dispute is referred for determination in accordance with subrule (4) and the Registrar determines that the pre-filing statement is not defective, the Registrar may direct that the pre-filing statement be considered to have been served on the date when it was in fact served or a subsequent date. (7) Where a defendant has given notification in accordance with section 317(1) of the 1998 Act and subsequently in respect of the same claim serves a pre-filing defence as referred to in rule 17.5: (a) despite any application of subrule (3), the pre-filing statement is taken to have been served, and (b) the defendant is taken to have waived any objection to the defects alleged in the notification. 33 The respondent's pre-filing statement served on 1 June 2006 comprised a schedule of documents with attachments as indicated. The schedule, inter alia, identified the following items: ... 10. Applicant's Statement to be provided 11. Vocational Assessment report to be provided 12. Updated medical reports to be provided 13. Expert report as regards liability to be provided 14. Plaintiff's income tax returns for the years ending 30 June 1998 to date to be provided. 34 The draft statement of claim filed with this pre-filing statement pleaded that the respondent suffered injury to his back as the result of a slip and fall accident, which occurred when he stepped in water which was on the floor while he was carrying print cylinders, which were approximately 1.5 metres long. The particulars of negligence were pleaded as follows: 1. Failing to remove water from the floor prior to the Plaintiff's accident. 2. Permitting water to remain on the floor when the Defendant, its servants or agents knew or should have known that it posed a slip hazard to workers such as the Plaintiff. 3. In failing to render the floor, the location of the plaintiff's accident, safe by installing slip resistant material, such as matting or coating the floor with slip resistant paint, in and about the area where the Plaintiff fell. 4. In its failure to implement, maintain or enforce and adequate cleaning system (sic) as regards the removal of water from the floor prior to the Plaintiff's accident. 35 The draft statement of claim that was attached to the second pre-filing statement pleaded, in the alternative, that the plaintiff's slip and fall accident occurred due to water deposited on the floor as a result of a leak or leaks in the roof of the premises: (par 3). The particulars of negligence repeated those contained in the earlier draft pleading with four additional particulars: 5. In failing to provide safe plant equipment such as the use of an ultrasonic cleaning machine with hoist and hot air drying. 6. In failing to install a drainage rack adjacent to the water tank where the cleaning of the cylinders occurred. 7. In failing to repair the leaking roof in the premises, prior to the accident. 8. Failing to implement any, or any adequate, risk safety procedures.

[49]

46 There is no evidence of the contents of any covering letter under which the schedule of documents was served on the appellant. Mr Jobson said that there had been no assertion made on the respondent's behalf that the first pre-filing statement was not complete. This is consistent with the assertion in the affidavit of Spiro Eistis, the solicitor acting for the respondent, that on or about 1 June 2006 a pre-filing statement was served on the defendant and its workers compensation insurer (par 3, affidavit sworn 8 August 2007, Red 186.B-F). The appellant acted on the assumption that the document served on it on or about 1 June 2006 was a pre-filing statement within s 315(1), to which it responded by serving a defence within s 316(1). It may have been open to it to consider that service had not been effected because the documents identified in Items 10 - 14 had not been served. Such a decision however would have involved significant risk. Particularly since Item 12, was in terms "updated medical reports to be provided". The appellant could not know when the last document answering this description had been served. In any claim which ultimately proceeds before a court updated medical reports are likely to be obtained and the conditions for the grant of leave to rely on them established. In my opinion the respondent's foreshadowed reliance on updated medical reports did not amount to any indication that the first pre-filing statement was incomplete without them. However, different considerations may apply to Items 10, 11, 13, and 14 of the schedule. It was open to the appellant to assert that the pre-filing statement was not complete without these documents. However, the appellant lost its right to so assert after seven days. The appellant served its pre-filing defence. It may be that the respondent could have objected to the service of the pre-filing defence asserting that service of the pre-filing statement had not been effected. But this is not what happened. The respondent referred his claim for mediation consistently with acceptance that his pre-filing claim had been served on the appellant at least 28 days earlier: s 318A(1).

[52]

50 The effect of service of the respondent's pre-filing statement is that time ceased to run under s 151D of the 1987 Act. A step needed to be taken by the appellant or the respondent before time resumed running. That step was either an application by the appellant to strike out the pre-filing statement or its withdrawal by the respondent. The appellant had not procured the striking out of the pre-filing statement and as at 23 March 2007 the respondent had not withdrawn it. It follows that the pre-filing statement remained current: s 151DA(2) of the 1987 Act. It was not submitted that two pre-filing statements arising out of the same injury could be current at the same time. Mr Campbell's submission was that the service of the document titled 'second pre-filing statement' impliedly effected the withdrawal of the first. In my opinion the withdrawal of a pre-filing statement by the person who served it requires at the least the communication of the fact of withdrawal to the person on whom it has been served. The appellant had responded to the pre-filing statement served by the respondent, which remained current. It was entitled to consider that in respect of the respondent's claim for work injury damages arising out of the injury sustained by him on 31 July 2003 it had preserved its entitlement in accordance with the scheme of Pt 6 to put in issue its liability in any court proceedings. 51 I consider that the Judicial Registrar erred in holding that the pre-filing statement was defective. The appellant has not asserted that it was defective by reason of incompleteness or otherwise. It conformed to the minimum requirements of s 315(1) and had been served on the appellant and responded to by it and acted upon by both parties as an effective pre-filing statement for the purposes of Pt 6. The draft defence in Exhibit "A" is in the same terms as the defence filed in the District Court. The appellant was not precluded under s 318(1)(c) from relying on pars 2 and 3 of the defence and it was an error to strike them out. 52 The question of whether s 315(1) requires the service of the evidence, as distinct from particulars of the evidence, as part of the pre-filing statement was left open in Serna. It was not raised in this appeal. It is to be noted that the appellant's position before the Judicial Registrar was that under s 315(1) it is sufficient that particulars of the evidence be served (CB 15.T-W). 53 For these reasons I propose the following orders:

[53]

ORDERS 1. Grant leave to appeal. 2. Direct that the amended notice of appeal be treated as filed pursuant to leave. 3. Allow the appeal and quash the orders made by the Judicial Registrar on 6 November 2007 striking out paragraphs 2 and 3 of the defence filed on 5 July 2007. 4. Dismiss the respondent's notice of motion filed in the District Court on 15 August 2007. 5. The respondent is to pay the appellant's costs of the appeal and in the court below and with respect to the appeal to have a certificate under the Suitors Fund Act 1951, if otherwise qualified. 54 GYLES AJA: I agree with the orders proposed by Bell JA. I agree that the only effective pre-filing statement was that served on 6 June 2006 for the reasons given by Bell JA supplemented by those of Hodgson JA. That conclusion is supported by an additional reason - if a pre-filing statement can be withdrawn to permit another to be served, that cannot be done once (as here) it has been acted upon by the proposed defendant. 55 In his oral submissions, counsel for the appellant was prepared to assume that a pre-filing statement could be withdrawn and another served because of s151DA(2) of the 1987 Act. That assumption is debateable, and, of course, does not settle the proper construction of the statutes. The correctness of it does not need to be decided in this appeal as there is no scope for such withdrawal in this case. 56 Part 6 of Div 3 of the 1998 Act sets up what Hodgson JA has aptly described in his reasons as an elaborate edifice based on the existence of a single identifiable pre-filing statement. His Honour points out that service of successive pre-filing statements is inconsistent with the evident purpose of the legislation and would be unfair to potential defendants. 57 The elaborate, and prescriptive, scheme makes no provision for withdrawal of a pre-filing statement or for the service of successive statements. 58 The 1998 Act, rather than the 1987 Act, governs recovery of work injury claims and prevails in the event of inconsistency (s2A of the 1987 Act). Section 151DA(2) of the 1987 Act is not directed to laying down procedures for claims and is not framed in terms that grant a right. If it is to be given any effect beyond limitations, that should not derogate from the scheme of the 1998 Act. That might be achieved by permitting the withdrawal of a pre-filing statement before it is acted upon by the proposed defendant in a substantive and unequivocal way. That would avoid most, if not all, of the inconsistency and unfairness to which Hodgson JA refers. 59 In the present case, a pre-filing defence was served and a mediation was conducted prior to the purported service of the second statement. The proposed defendant (indeed both parties) unequivocally acted upon the effectiveness of the statement served on 6 June 2006. Withdrawal of that statement was not permissible in those circumstances. As the 1998 Act does not permit two pre-filing statements to be extant at the one time, the later statement was not a pre-filing statement in accordance with the 1998 Act, and was ineffective. The pre-filing statement served on 6 June 2006 remains on foot, as do the steps taken by reference to it.

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