Plaintiff v Defendant [2014] VSC 129 | Case summary

Supreme Court of Victoria|2014-03-28|Before: RUSH J

ACCIDENT COMPENSATION - admission sought after receipt of workers compensation - whether acceptance of Workcover claim form founds request by the plaintiff that the defendant admit it has paid and continues to pay the plaintiff's medical and like expenses - injury arising out of or in the course of employment - Accident Compensation Act 1985 ss 82(1) and 99(1).

2 Prior to closing the plaintiff's case, Mr Mighell sought an admission from the defendant in the following terms:

"That in furtherance of the acceptance of the Workcover claim, the defendant has paid and continues to pay the plaintiff's medical and like expenses".

3 Mr Mighell said he wished to use the admission as a basis for inviting the jury to infer that the plaintiff suffered injury in the course and scope of his employment.

4 The issue was of some significance as the defendant at trial alleged that the plaintiff's injury arose not while working for the defendant on Thursday 9 August 2007, but rather on Saturday 11 August 2007 when the defendant alleges the plaintiff was undertaking contracting work unrelated to his employment.

5 The defendant resisted the admission. As Mr Middleton was ill on the day the plaintiff's case was closed, argument was deferred until the following day, 18 March 2014. I heard argument both prior to and after the defendant had closed its case and ruled the plaintiff was entitled to the admission sought. So as not to delay the jury trial, I said I would publish my reasons at a later date.

(a) it was not unusual to seek such an admission in a serious injury application, but such admissions were not sought in damages actions at common law;

(b) the employer did not believe the plaintiff suffered injury in the course of his employment and thus he said it was all about the "subrogation of rights that takes place";

(d) by the admission sought the plaintiff was attempting to prove causation.

7 Pursuant to s 81(1) of the Evidence Act 2008 (Vic), the hearsay rule and the opinion rule do not apply to evidence of an admission. Odgers, in Uniform Evidence Law in Victoria, sets out the following definition of "admission":

"Admission means a previous representation that is:

(a) made by a person who is or becomes a party to a proceeding (including a defendant in a criminal proceeding); and

(b) adverse to the person's interest in the outcome of the proceeding".[1]

The terms "previous representation" is defined:

"Previous representation means a representation made otherwise than in the course of giving evidence in the proceeding in which evidence of the representation is sought to be adduce".[2]

In light of the above, the evidence that the plaintiff submitted a Claim Form and that claim was accepted by the defendant, evidence led without objection, was on its own capable of giving rise to an admission against the defendant.

8 It is pertinent to consider provisions of the Accident Compensation Act 1985 (the "Act") concerning entitlement to compensation. Section 82(1) reads:

"If there is caused to a worker an injury arising out of or in the course of any employment, the worker shall be entitled to compensation in accordance with this Act".

9 Medical and like expenses are payable pursuant to s 99(1) of the Act. The section reads:

"If there is caused to a worker an injury which entitles a worker to compensation, the Authority or self-insurer... is ...to pay as compensation:

(a) the reasonable costs of the road accident rescue services, medical, hospital, nursing, personal and household, occupational rehabilitation and ambulance services received because of the injury..."

10 It is clear that the plaintiff is only entitled to the reasonable costs of medical and like expenses if he sustained injury arising "out of or in the course of any employment".

11 Mr Middleton referred me to a number of authorities he submitted supported his contentions, including Sejranovic v Berkley Challenge,[3] Baulch v Lyndoch Warrnambool Inc,[4] Transport Accident Commission v Florrimell,[5] and Ansett Australia Ltd v Taylor,[6] Ifka v Shahin Enterprises Pty Ltd,[7] and Fokas v Staff Australia Pty Ltd.[8] Mr Middleton summarised these authorities by contending that the sought after admission introduced an irrelevancy to the trial distracting the jury from key issues of causation, and that the authorities supported the proposition that administrative processes that were part of the "no fault" Workcover scheme should not be permitted in evidence in a common law trial.

12 Mr Middleton relied upon Baulch to advance his submissions that there should be no reference to "plaintiff's entitlements to workers compensation" because "it was an extraneous matter". In Baulch, the Court of Appeal (Neave, Bongiorno JJA, Byrne AJA) referred with approval to the Victorian Full Court decision of Chatzipantelis v Grimwade Castings Pty Ltd[9] that a charge to the jury containing an explanation of the workers compensation system introduced irrelevancy and distraction to the trial. However, as the Court of Appeal observed, the Full Court in Chatzipantelis recognised it was "accepted that mention of workers compensation in a common law trial would not always be an irrelevance".[10]

13 Their Honours in Baulch indicated that receipt of workers compensation may have been relevant in assessing damages taking into account the principles of Fox v Wood[11] in the circumstances of that case. [12]

14 There are other examples where the mention of workers compensation may be relevant. A defendant may cross-examine a plaintiff as to lack of motivation to work when in receipt of workers compensation. It would be contrary to logic and fairness to deny the plaintiff in such a situation the opportunity of using such payments as an admission that during the period the plaintiff received such payments, the defendant acknowledged the plaintiff was unfit for work or, in the appropriate case, that such payments constituted an admission on the part of the defendant that the injury arose out of or in the course of employment.

15 Hunt CJ at CL, in Heuston v Yore Contractors Pty Ltd,[13] considered, in a jury trial, whether the continued payments of workers compensation amounted to an admission that the plaintiff was still incapacitated as a result of an injury he received in the course of his employment. Hunt CJ at CL stated:

"There can be no doubt that the statutory scheme in this State constitutes the insurer as an agent of the employer with authority to make admissions on its behalf in relation to a claim (including a common law claim) within the policy.

In my opinion, therefore, the continued payment of worker's compensation is admissible against the defendant in whose name the insurer defends the common law proceedings as an admission that the worker is still incapacitated at the time of such payments as a result of the injury which he received in the course of his employment - such admission always being, of course, open to explanation by way of evidence in the same way as any other informal admission is open to explanation".[14]

16 The reasoning of Hunt CJ at CL was specifically referred to with approval by the New South Wales Court of Appeal in the case of Morvatjou v Moradkhani.[15] McColl JA (with Hoeben and Tobias JJA in agreement) referred to the reasoning in Heuston as "authority"[16] for the proposition Hunt CJ at CL stated as set out above.

17 In Ansett, Ashley JA (with Maxwell P and Bongiorno AJA in agreement) was concerned with the question of whether the prior acceptance by the Workcover Authority (the "Authority") under s 104B(2) of the Act, of a worker's claim under s 98C for lump sum compensation for non-economic loss in respect of an injury resulting in permanent impairment, established conclusively that the worker had sustained compensable injury. Ashley JA stated:

"But in cases where liability in relation to such a claim was accepted, I consider that the acceptance should stand only as an admission by the Authority or self-insurer, speaking for the employer, that such an injury had been sustained. Having regard, however, to the very serious consequences for the Authority or self-insurer flowing from acceptance of a claim - not only in respect of compensation payable under s 98C or s 98E, but also, potentially, with respect to s 134AB(3) and (15) - I consider that such an admission should ordinarily be regarded as very significant; albeit not conclusive, because a defendant, in a particular case, might be able to satisfactorily explain its conduct".[17]

18 Mr Middleton referred to Florrimell where the Court of Appeal (Hansen and Tate JJA) distinguished Ansett from the factual circumstances of the appeal they were considering. Their Honours stated that Ansett was:

"...far removed from the proposition that a payment by TAC for various procedures is to [be] treated as evidence of an admission or the subject of causation. The issue of causation may well be a complex one and, as here, may be one on which medical opinions conflict. For the TAC to accept to pay for the cost of a procedure cannot have the effect of precluding them from later contesting the issue of causation, perhaps on the basis of the information obtained from the very procedure that it paid for".[18]

19 Their Honours in Florrimell concluded that it would be contrary to the efficient administration of the compensation scheme if the TAC were to resist from paying for medical procedures on the basis that if to do so it could be regarded as having made an admission. Mr Middleton contended that the plaintiff was attempting to use the sought for admission "as proof of causation". I do not think that is a proper description of the attempted use of the admission in this case. The admission the plaintiff seeks does not relate to causation of injury in the sense discussed in Florrimell. It relates to a fundamental issue concerning liability - whether the plaintiff suffered injury at work. The admission the plaintiff seeks, and to which I believe the plaintiff is entitled, was no more than that the acceptance of the Claim Form by payment of medical and like expenses is capable of being used by the jury as evidence that the plaintiff suffered back injury in the course and scope of his employment in the manner set out in the Claim Form.

20 The New South Wales Court of Appeal in Gordon v Ross[19] considered a challenge to the decision of a trial judge to rely on payment by the workers compensation insurer, on behalf of the appellant, of domestic assistance to the plaintiff as an admission of liability. After consideration of a number of authorities, Basten JA concluded:

"In the area of compensation payments, the fact of payment has been held to be some evidence, by way of admission, that the worker had met with an incident arising out of or in the course of employment."[20]

21 In the case of Gordon, Basten JA referred to the UK Court of Appeal decision of Way v Penrikyber Navigation Colliery Company Limited.[21] In that case, MacKinnon LJ found that payment of compensation under the Workmen's Compensation Act 1925 "is some evidence [the employer] admitted that there was an accident".[22] Goddard LJ stated of the payment of compensation: "I find it very difficult to see how it can be said that that is not some evidence on which the judge could find that the employer admitted that an accident had taken place".[23]

22 As stated, Mr Middleton contended that it was not unusual to seek admissions of the nature sought by the plaintiff in serious injury applications, but he said this practice was not followed at trial. Mr Mighell disagreed with the proposition that this type of admission was not sought at trial. My experience is in conformity with the position put by Mr Mighell and the authorities referred to above. The reasons proffered as to why the sought for admission was not acceptable at trial included that such admission was a distraction, irrelevant, unfair in the sense that the defendant, at the time, did not believe the injury had occurred in the course of employment. In this regard, Mr Middleton said, "the employer was in disagreement with acceptance of the plaintiff's claim by the agent".

23 I can find no merit in the proposition that the admission cannot be led in a common law trial because the employer was in disagreement with the acceptance of the Claim Form. If the employer was in disagreement with the acceptance of the Claim Form at trial, then it is obvious the employer was in disagreement at the time of the acceptance of the claim and "no fault" compensation was paid pursuant to provisions of the Act. There is a contradiction in the defendant's argument in these circumstances in submitting that payment of compensation (against the wishes of the defendant) can be used as an admission in a serious injury application but not at trial. Further, the Act contains a provision, s 114I, that permits an employer to object to a decision of the Authority to accept liability if the employer believes the worker (here, the plaintiff) is not a worker within the meaning of the Act. There is no evidence to suggest the defendant objected to the acceptance of liability by use of this provision. There is no justification for what is in effect the defendant's argument that the words of Ashley JA in Ansett, "I consider that the acceptance should stand only as an admission by the Authority or self-insurer, speaking for the employer, that such an injury had been sustained",[24] should be confined to serious injury applications. I believe that I am bound by this reasoning.

24 I do not agree with the proposition of Mr Middleton that the introduction of the admission will be confusing to a jury. The admission is capable of explanation in a straightforward and uncomplicated manner. Properly instructed, a jury could be expected to understand the comparatively straightforward way they could use this admission. For these reasons I also reject the submission made by the defendant that I should not admit evidence of the admission pursuant to s 135 of the Evidence Act 1995. I do not consider this evidence misleading or confusing. Further, Mr Middleton suggested the admission should not be admitted into evidence "because it undermines what is essentially a fresh or proper attack on the evidence in respect of causation". I do not accept that a party in common law proceedings can somehow cocoon its prior conduct from scrutiny at a trial for damages.

25 The jury are not bound to act on the admission at all. It is part of all the evidence concerning the circumstances of the claimed incident that is the subject of the proceedings before the jury, a matter the jury is entitled to take into account, along with all other evidence, including evidence of the employer Mr Knoop, that on one view pointed to the plaintiff not sustaining injury in the course of his employment.

26 Mr Middleton referred me to a ruling of Cummins J in the matter of Raeburn v Tennix Defence Systems Pty Ltd.[25] The admission sought in that case by counsel for the plaintiff was significantly wider than the admission sought in this case and contained within it matters that arguably could not properly be the subject of an admission. Cummins J considered "that the admission sought [was] misconceived in law and unsupported in fact".[26] His Honour continued: "It is unsupported in fact because the defendant hitherto or at trial, has not denied that an injury occurred at the workplace...but the fact of an injury occurring in the workplace is not in issue".[27] The factual difference between Raeburn and this case is immediately apparent - here, there is a denial of workplace injury, a consideration of obvious importance to Cummins J in his assessment as to whether an admission should be permitted.

27 Cummins J, in Raeburn, went on to find that the plaintiff's submission convoluted statutory subrogation of the Authority conducting a case on behalf of the defendant into a reverse relationship of the defendant having as its agent the Authority, and stated that, "the illogicality of such proposition is clear; the fact the Authority pays a medical bill or makes a weekly payment does not constitute an admission by the defendant".[28]

28 Cummins J distinguished the reasoning of Ashley JA in Ansett from the facts in Raeburn because, he said, in Ansett, the Court was concerned with the interrelationship between s 98C and s 134AB "not the common law situation".[29] For the reasons set out above I respectfully disagree with His Honour that an admission concerning s 98C or 134AB cannot potentially be used in common law cases.

29 With respect to Cummins J, I do not agree that in the context of the provisions of the Act, "the fact that the Authority pays a medical bill or makes a weekly payment does not constitute an admission by the defendant".[30] A function of the Authority pursuant to s 20(1)(g) of the Act is to "defend actions against employers under this Act and at common law". The liability to pay compensation where there is an entitlement lies with the employer.[31] In my opinion, the Authority defends such actions as the statutory agent of the insured defendant employer, here, Trowelcoat Pty Ltd. In ICI Australia Operations Pty Ltd v Workcover Authority of New South Wales,[32] McColl JA (with Mason P and Meagher JA in agreement) considered aspects of the New South Wales Workers Compensation Act 1987. The relationship between a designated insurer under the New South Wales Act and employer in circumstances where the designated insurer discharged its statutory obligation by payment the employer's liability under the Act was considered. McColl JA stated:

"In my view, the designated insurer discharges the employer's liability as statutory agent for the employer. Thus, although the moneys to discharge Mr Brazier's claim came from CGU, they should be treated as having been paid by ICI. It is in fact ICI, the employer, which satisfied Mr Brazier's claim".[33]

Similarly, Ashley JA in Ansett clearly understood the Authority to be "speaking for the employer".[34] The payment of medical expenses in this case is to be seen as payment by the defendant and capable of giving rise to the admission sought by the plaintiff.

30 Mr Middleton referred me to s 134AB(23) of the Act and the statutory requirement that in a (common law) trial a jury must not be told of monetary thresholds, or that an injury the subject of the proceeding has been deemed or found to be a serious injury. It was submitted this provision supported a contention that matters of compensation under the Workcover scheme should not be mentioned at trial and thus the sought for admission was against the tenor of the Act. I do not accept this proposition. The section is clearly limited to the matters mentioned.

31 In the circumstances of this case, in my opinion, there is no legal bar to the admission sought by the plaintiff.

[13] BC9203270, 9 March 1992, unreported judgments NSW.

[19] [2006] NSWCA 157 (Basten JA with Hodgson and Bryson JJA in agreement).

[23] Ibid at 528. See also Harley v Walsall Wood Colliery Co Ltd (1915) 8 BWCC 86 (Couzens-Hardy MR with Swinfon Eady and Phillimore LJJ in agreement) referred to payment of compensation and stated: "In my opinion that is a fact which dispels any possible doubt and clearly proves that this was an accident arising out of and in the course of employment" at 88. See also Department of Education and Training v Sinclair [2005] NSWCA 465 (Spigelman CJ with Hodgson and Bryson JJA in agreement) at [89]-[91].

[33] ICI Australia Operations at [301].

Compensation Act 1985