Plaintiff v Defendant

2 On 24 October 2008, Judge Campbell of the County Court granted the plaintiff leave to commence the proceeding under subs 134AB(16)(b) of the Accident Compensation Act 1985 ('the Act').

3 Against the background that it was common ground that the plaintiff had injured his back as a consequence of the incident, his Honour made findings in the following terms:

1. The initiating injury which the plaintiff asserts has brought about his downfall, both physically and psychologically, occurred on the 23rd February 2001 whilst working at the first defendant's premises when he struck his left hip on a lug protruding from a boiler which had been placed in an inappropriate spot in his work area. Whilst there is debate amongst the appropriate specialists as to the consequences of this contact, as will be seen, it seems that at least there was some trauma at the L3-4 and/or L4-5 lumbar spine where there is bulging of the disc at both levels and apparently an annular tear a the latter level. This appears to be associated with disc degeneration, particularly at L4-5.
2. The mental or behavioural disturbance or disorder that is said to flow from the consequences of that injury ... variously described by the majority of the pod of psychiatrists who have either treated or examined the plaintiff, is that of an adjustment disorder with depressed mood, or moderately depressed mood with suicidal thoughts, or a chronic major depressive disorder or chronic adjustment disorder with anxiety and depression. Dr Orchard [a treating psychiatrist] now opines that the plaintiff suffers from Bipolar Spectrum Disorder, Attention Deficit Hyperactivity Disorder (ADHD) and Substance Abuse Disorder.
3. The Court is probably not qualified to adjudicate upon the competing diagnoses of Dr Orchard and, save for Dr Entwisle, the other reporters to whom I have referred. I myself would not have been prepared to dismiss Dr Orchard's striving to get to the seat of the plaintiff's psychiatric problems out of hand. Whilst I understand that the other reporting psychiatrists have reported for medico-legal reasons only, had there been a vehement or violent disagreement as to the plaintiff's treatment, I expect, as expert and objective witnesses that they would have voiced those concerns. Save, I think, for Dr Entwistle, none have done so. ...
4. In the end result, I am satisfied, at least under s 134AB(16) and (38)(d), that the plaintiff's behavioural disturbance or disorder can be fairly described as being more than serious to the extent of being severe. I am also satisfied that as a consequence of that permanent severe behavioural disturbance or disorder, ... the plaintiff has had a total loss of earning capacity.
5. So far as the plaintiff's claim under [paragraph (a)of the definition of 'serious injury' in s 134AB(37)] is concerned, I am left in some doubt as to whether it of itself constitutes a serious injury as defined. That aspect of the claim will be dismissed.
6. There will therefore be leave to the plaintiff to commence common law proceedings.[1]

4 I am not persuaded by the submissions of counsel for the defendant in so far as they contend that his Honour made no finding that the plaintiff suffered a mental injury as a consequence of a physical injury to his lumbar spine. Nevertheless, I deal with this application on the basis that the court found that the plaintiff had suffered an identified compensable mental injury as a consequence of the incident.

5 The plaintiff now seeks a ruling that, under subs 134AB(19)(c) of the Act, the Judge's findings give rise to an issue estoppel as to each of the following facts:

• that the incident occurred on 23 February 2001; and

• that the plaintiff sustained a 'serious' mental injury within the meaning of the term 'serious injury' under s134AB (37) and (38) of the Act as a result of the incident.

7 I will refer to the relevant provisions of the Act which include subss (16)(b) and (19)(c), rather than isolating them at this point.

8 The entitlement to commence proceedings to recover damages for loss sustained as a result of an injury arising out of or in the course of or due to employment on or after 20 October 1999 ('compensable injury') is governed by s 134AB of the Act.[2]

injury means any physical or mental injury and, without limiting the generality of that definition, includes -

(a) industrial deafness;

(b) a disease contracted by a worker in the course of the worker's employment (whether at, or away from, the place of employment);

(c) a recurrence, aggravation, acceleration, exacerbation or deterioration of any pre-existing injury or disease;

134AB Actions for damages

(1) A worker who is ... entitled to compensation in respect of an injury arising out of or in the course of, or due to the nature of, employment on or after 20 October 1999 -

(a) shall not, in proceedings in respect of the injury, recover any damages for non-pecuniary loss except -

(iii) ... as permitted by and in accordance with this section; and

(b) shall not, in proceedings in respect of the injury recover any damages for pecuniary loss except -

(ii) ... as permitted by and in accordance with this section.

11 Subsection 134AB (2) further limits the entitlement to commence proceedings for damages by requiring that the subject injury must be a 'serious injury'.

12 An injury will be a serious injury if its consequences fall within the description in sub- 134AB (37) which provides :

(a) permanent serious impairment or loss of a body function; or

(c) permanent severe mental or permanent severe behavioural disturbance or disorder; or

13 Subsection 134AB(38) contains further provisions relevant to the question whether an injury is serious under the description in subs (37) :

(38) For the purposes of the assessment of serious injury in accordance with subsections (16) and (19) - ...

(b) the terms serious and severe are to be satisfied by reference to the consequences to the worker of any impairment or loss of a body function, disfigurement, or mental or behavioural disturbance or disorder, as the case may be, with respect to -

(i) pain and suffering; or

(ii) loss of earning capacity -

when judged by comparison with other cases in the range of possible impairments or losses of a body function, disfigurements, or mental or behavioural disturbances or disorders, respectively;

...

(d) a mental or behavioural disturbance or disorder shall not be held to be severe for the purposes of subsection (16) unless the pain and suffering consequence or the loss of earning capacity consequence is, when judged by comparison with other cases in the range of possible mental or behavioural disturbances or disorders, as the case may be, fairly described as being more than serious to the extent of being severe;

(j) the assessment of serious injury shall be made at the time that the application is heard by the court;

14 A worker wishing to commence proceedings for damages in relation to an injury which is both a compensable injury and a serious injury must first seek a determination of their degree of impairment under s 104B of the Act by the Victorian WorkCover Authority ('VWA') or a self-insurer. If the determination is that the worker's degree of impairment is less than 30 per cent, then, unless the VWA or the self-insurer is satisfied that the injury is a serious injury and consents to the proceeding, the leave of a court may be sought under s 134AB(16)(b).

15 Subsection 134AB(19)(a) provides that the court dealing with an application for leave to commence proceedings may not grant it unless it is satisfied on the balance of probabilities that 'the injury is a serious injury'.

16 The subsection also contains the provision said to create the asserted issue estoppels:

(c) no finding (other than a finding that the injury is a serious injury) made on an application for leave to bring proceedings shall give rise to an issue estoppel.

17 Section 134AB also contains a provision to the effect that a jury in any proceeding brought under it must not be told certain things :

(23) In the trial of a proceeding brought under this section, a jury must not be informed - ...

(b) that any injury in respect of which the proceeding has been brought has been deemed, found, or required to be found, to be a serious injury; or

(c) that the Authority or self-insurer has been satisfied that the injury is a serious injury; or

(d) that the Authority or self-insurer has issued a certificate under subsection (16)(a).

18 In an application for leave to commence proceedings under subs 134AB(16)(b), the court must therefore identify a compensable injury and analyse its consequences in order to decide whether it is a serious injury.

19 In Barwon Spinners Pty Ltd & Ors v Podolak[3] the Court of Appeal dealt with four appeals from decisions of the County Court as to the grant of leave to commence proceedings under s 134AB. It relevantly held that:

• the word 'injury' was used in the Act in its ordinary sense and did not refer to the impairment of a body function which (at least in cases such as those before the Court) might lead to its characterisation as a 'serious injury';[4]

• subsection(1) of s 134AB is dominant and is a preface to all that follows making it critical for a plaintiff to identify compensable injury relating to employment on or after 20 October 1999;[5]

• it is the injury linked to that employment that s 134AB addresses;[6]

• it suffices on any application for leave under s 134AB(16)(b) for the applicant to show that the injury falls within subs 134AB(1) and is a serious injury as defined.[7]

20 Counsel for the plaintiff argue that the decision in the leave application has given rise to an issue estoppel under subs 134AB(19)(c) extending to the issues of the occurrence of the incident and the existence of the requisite causal link between the incident and the mental injury found to be serious. According to them, there remains a live issue as to whether negligence on the defendant's part was a cause of the incident and the consequential injury, loss or damage.

21 Counsel contend that once the jury has decided that the defendant's negligence was a cause of the incident, it will be estopped from finding that the plaintiff did not suffer a consequential serious mental injury.

22 The plaintiff relies upon the structure of s 134AB. Counsel points out that it was necessary for the court in the leave application to determine first that the plaintiff had an injury which was compensable (in that it met the subs (1) requirements), before considering whether the consequences of the compensable injury were serious[8]. The estoppel in the exception to the general rule in subs (19)(c) is then as to 'the finding that the injury is a serious injury': 'the injury' meaning the compensable injury with the subs 134AB(1) connection with employment because it arose as a consequence of the incident .

23 Counsel for the plaintiff refer to and rely upon the High Court's consideration of the effect of subs 134AB(19)(c) in Dwyer v Calco Timbers Pty Ltd[9] where the court said:

If leave had been given, the statutory barrier to the bringing of proceedings by the appellant for the recovery of damages would have been removed. In that action for damages the appellant would have had in his favour an issue estoppel arising from the finding that his injury was a 'serious injury', but no other estoppel. This would have followed from para (c) of sub-s (19). The provision respecting the issue estoppel both reflects the importance (by reason of its finality) of the determination in any leave application of the issue of 'serious injury' and highlights the requirement that the reasons of the County Court be as extensive and complete as those at a trial of the action.[10]

24 Counsel for the plaintiff also cite the recent ruling by Beach J in Norris v Brumar (Victoria) Pty Ltd[11] where his Honour held that the defendant was estopped from contesting that, as at the date of the leave application decision, the plaintiff had suffered from a mental injury which was 'serious' within the terms of paragraph (c) of the definition of serious injury in sub-s 134AB(37) and sub-ss 134AB (38)(b) and (d). Beach J stated his conclusion this way:

It follows, for the reasons already given, that the estoppel on the issue of "serious injury" is as I have previously explained it. That is, the defendant is estopped from denying that as at July 2005 the plaintiff suffered from a permanent severe mental or permanent severe behavioural disturbance or disorder. It was severe by reference to the consequences to the plaintiff of the mental or behavioural disturbance or disorder with respect to pain and suffering and loss of earning capacity - when judged by comparison with other cases in the range of possible mental or behavioural disturbances or disorders. Further, it was severe because the pain and suffering consequences and loss of earning capacity consequences when judged by comparison with other cases in the range of possible mental or behavioural disturbances or disorders were more than serious - to the extent of being severe. This was permanent as at July 2005 - at least in the sense of being likely to last for the foreseeable future.

25 Neither the High Court in Dwyer nor his Honour in Norris specifically address the issue before the Court as to whether the estoppel extends to the determination that the serious injury is compensable, in the sub-s 134AB(1) sense, by reason of it having been a consequence of an alleged incident.

26 Counsel for the plaintiff contend that the jury may still consider the issues of:

• the influence of pre-existing conditions in what may have been the plaintiff's capacity for employment, absent the injury, (subject counsel maintain, to 'the reverse onus as in Watts v Rake'[12]); and

• matters such as the plaintiff's employability in the labour market with or without the injury.

27 Counsel for the defendant contend that the issue of causation is, in every respect, one for the court in the damages proceeding. Accepting the correctness of the ruling made by Beach J (pending the outcome of an appeal in which judgement has been reserved), they maintain that any estoppel would be limited to the issue of the seriousness of the injury in relation to which leave is granted, as at the date of the leave application decision .

28 They cite the decision of the Court of Appeal in an appeal from a refusal of a leave application in Sejranovic v Berkeley Challenge Pty Ltd.[13] There, the plaintiff sought leave to commence common law proceedings against her employer in relation to an alleged mental illness consequential upon a physical injury to her right shoulder, arm and hand, having previously suffered injuries to those areas in a motor vehicle accident. She maintained that her motor vehicle accident injuries had resolved by the time she injured herself at work.

29 Warren CJ and Hargrave J found in the appeal that the plaintiff had made out her case and concluded that she had suffered a serious mental injury as a consequence of her workplace physical injury. In a passage cited by counsel for the defendant, their Honours went on to say :

1. 180. In her draft statement of claim, the appellant does not contend in the alternative that, if her mental symptoms consequent upon the physical injury suffered by her in the 1994 collision had not fully resolved prior to her being injured in the course of her employment, her mental disturbance at that time was exacerbated by her physical injuries. The granting of leave to commence a common law proceeding does not prevent the appellant from pursuing an alternative claim in that proceeding. Just as the respondent remains free to contend at trial that the appellant's mental symptoms were not caused by her physical injuries, the appellant is free to pursue such an alternative claim. By granting leave to commence proceedings, the Act provides only for an issue estoppel as to this Court's finding that the appellant is suffering from a serious injury. The cause of that serious injury is a matter to be determined at trial. (See s 134AB(19)(c) of the Act.)

30 Counsel for the defendant also cite Brambles Ltd v Andar Transport Pty Ltd[14] where, with reference to an application under s 135A which contains no equivalent to s 134AB(19)(c), the Court of Appeal held that :

By its very nature, a preliminary finding by a judge that the applicant for leave has sustained e 'serious injury' arising out of his employment does not finally determine the rights of the parties. It is merely a preliminary step along the way to establishing those rights. It does not prevent the defendant, at the trial, from challenging the seriousness of the injury or from seeking to show that it did not arise out of the plaintiff's employment or that such employment did not significantly contribute to it. The focus of the leave application is whether, in the opinion of the judge asked to grant leave, the injury is a 'serious' one within the meaning of s 135A(19).[15]

31 Notwithstanding the absence of any equivalent estoppel provision, counsel rely upon what was said to be the general statement of principle in the extracted passage in support of their resistance to the extension of the estoppel to the issue of causation in any respect. They maintain that the focus of leave applications was on the issue of the seriousness of a compensable injury and that generally with the exception of cases in which an 'aggravation' injury is alleged, the court does not make a determination about causation.

32 Counsel for the plaintiff seek to confine the decision in Sejranovic to its own facts and the determination of the issues raised by an 'aggravation' injury. They also submit that in many cases in leave applications there is a causation issue to be addressed, particularly where the date on which an injury occurred is critical to the plaintiff's entitlement to commence proceedings under the statutory scheme.

33 I note at the outset that, insofar as counsel for the defendant might have maintained that it was no part of the judge's task in the leave application to identify a compensable injury in order to determine whether its consequences were serious, that submission must be rejected.[16]

34 It is implicit in Judge Campbell's analysis and decision to grant leave that his Honour found that the plaintiff had a compensable injury, under s 134AB(1), although he did not determine the precise characterisation of the injury. Indeed, his Honour stated[17] that he had directed himself in accordance with the deliberations of the Court of Appeal in the four 'Barwon Spinners cases'[18] and that he bore in mind other cases including Lu v Mediterranean Shoes Pty Ltd[19], Mobilio v Balliotis[20], Mutual Cleaning & Maintenance Pty Ltd v Stamboulakis[21], Church v Echuca Regional Health[22] and Jayatilake v Toyota Motor Corp Australia Ltd.[23]

35 Judge Campbell did note that the plaintiff was being treated by Dr Orchard for a Bipolar Spectrum Disorder and a 'lifelong' Attention Deficit Hyperactivity Disorder which, in Dr Orchard's opinion, rendered him vulnerable to physical and psycho-social trauma and explained his 'state of extreme collapse'. This alternative diagnosis was not inconsistent with the conclusion that the plaintiff's mental injury was one 'arising out of or in the course of or due to the nature of' his employment and compensable as a result.

36 There are two relevant questions to be addressed in a leave application under s 134AB. It is necessary for the court to identify an 'injury' (within the meaning in s 5 of the Act) suffered by the applicant, which is both one 'arising out of or in the course of or due to the nature of, employment' (under sub-s 134AB(1)) and one which has such consequences for the plaintiff that it may be described as a 'serious injury' (under sub-ss (37) and (38)).

37 The estoppel under sub-s (19)(c) relates to the issue of whether 'the injury' suffered is a 'serious injury'. Whilst 'the injury' to be assessed must mean the applicant's injury which has been identified by the judge in the leave application under sub-s (16)(b) as compensable (in the sub-s 134AB(1) sense), it is only the determination that the injury is a serious injury which is singled out as the exception to the general rule in sub-s (19)(c).

38 The definition of the word 'injury' does not incorporate its attribute of compensability under sub-s 134AB(1), notwithstanding that under s 134AB only an injury suffered by the plaintiff which is compensable under sub-s (1) can be characterised as a 'serious injury' and the subject of a grant of leave under sub-s (16)(b).

39 This construction of the estoppel provision is supported by the fact that it will not be in issue in a common law proceeding in negligence as to whether the injury, of which negligence is found to have been a cause, has met the criteria for compensability under sub-s 134AB(1). (I note in this regard that, although the issue of the 'seriousness' of the injury, within the statutory terms, is also not one the jury must directly address, the seriousness of the consequences of the injury as at 24 October 2008 might be seen as relevant to the issue of damages.)

40 The Court of Appeal has recently held in Sejranovic that the determination of the cause of a serious injury is to be made at trial[24] and I see no reason to distinguish that decision on the grounds that it concerned the possibility of an alternate claim relating to an 'aggravation injury'. Further, I am not persuaded that either the High Court's judgment in Dwyer or Beach J's ruling in Norris support the wider estoppel for which the plaintiff contends.

41 It follows that I see no warrant for extending the estoppel even further to the occurrence of the incident alleged to have given rise to the injury to which the sub-section refers.

42 In my opinion, the defendant is estopped from contesting either that the plaintiff has suffered the mental injury identified by the judge in the leave application and that that mental injury was, as at 24 October 2008, a serious injury within the meaning of that term in sub-ss 134AB(37) and (38).

43 There is no issue estoppel preventing the defendant from challenging the proposition that the injury has the connection with employment described in sub-s 134AB(1) required for the grant of leave under s 134AB, or that the incident occurred or that it was a cause of the injury.

44 In light of the provisions of sub-s 134AB(23), I will hear submissions in relation to what the jury might relevantly be told or not told in this case.

[1] Hamilton v Hunt Engineering Pty Ltd & Ors (Unreported, County Court, 24 October 2008, Judge Campbell).

[2] See Barwon Spinners Pty Ltd& Ors v Podolak [2005] VSCA 33; (2005) 14 VR 622 at 631-2, [12], Phillips JA.

[3] [2005] VSCA 33; (2005) 14 VR 622.

[4] [2005] VSCA 33; (2005) 14 VR 622, 630, [10] (Phillips JA for the Court, Ormiston, Chernov and Phillips JJA).

[5] [2005] VSCA 33; (2005) 14 VR 622, 631, [13] (Phillips JA for the Court, Ormiston, Chernov and Phillips JJA).

[7] [2005] VSCA 33; (2005) 14 VR 622, 632, [14] (Phillips JA for the Court, Ormiston, Chernov and Phillips JJA).

[8] Citing Petkovski v Galletti [1994] VicRp 32; [1994] 1 VR 436, 443-4, (Southwell and Teague JJ).

[9] [2008] HCA 13; (2008) 234 CLR 124.

[10] [2008] HCA 13; (2008) 234 CLR 124, 130, [11], (Gleeson CJ, Gummow, Kirby, Hayne and Heydon JJ).

[11] [2009] VSC 214.

[12] [1960] HCA 58; (1960) 108 CLR 158.

[13] [2009] VSCA 108.

[14] [2002] VSC 150.

[15] [2002] VSCA 150, [18], (Winneke P, Charles and Batt JJA).

[16] See Grech v Orica Australia Pty Ltd & Anor (2006) 14 VR 602, 604,[2], (Chernov JA), 612, [40], (Ashley JA).

[17] Hamilton v Hunt Engineering Pty Ltd & Ors (Unreported, County Court, 24 October 2008, Judge Campbell) [4], [5].

[18] [2005] VSCA 33; (2005) 14 VR 622.

[20] (1998) 3 VR 833.

[21] [2007] VSCA 46.

[22] [2008] VSCA 153.

[23] [2008] VSCA 167.

[24] [2009] VSCA 108, [180] (Warren CJ and Hargrave J).