Court of Appeal (WA)|2004-11-03|Before: Murray ACJ

Squires Transport Pty Ltd v Turnor [2004] WASCA 245 (3 November 2004)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION : SQUIRES TRANSPORT PTY LTD -v- TURNOR [2004] WASCA 245

Jurisdiction : DISTRICT COURT OF WESTERN AUSTRALIA

Citation : TURNOR -v- SQUIRES TRANSPORT PTY LTD [2003] WADC 91

Evidence - Workers compensation and trial for common law damages - Finding by review officer that playing sport not the sole cause of injury - Whether issue estoppel bound employer from asserting the contrary in the common law proceedings

Damages - Employer liability - Whether open to discount award because of retained earning capacity before trial - Common not to award interest so as to allow for contingencies of this kind - Whether double counting by reducing future economic loss for retained earning capacity and pre-existing degenerative condition

Workers Compensation and Rehabilitation Act 1981, s 5, s 18

Arnold v National Westminister Bank plc [1991] 2 AC 93

Chamberlain v Deputy Commissioner of Taxation [1988] HCA 21; (1988) 164 CLR 502

Cole v P & O Ports Ltd [2002] WASCA 157

Kanowna Bell Goldmines v Feierabend [2003] WASCA 246

Kuligowski v Metrobus [2002] WASCA 170; (2002) 26 WAR 137

Kuligowski v Metrobus [2004] HCA 34; (2004) 78 ALJR 1031

Linsley v Petrie [1998] 1 VR 427

March v E & M H Stramare Pty Ltd [1991] HCA 12; (1991) 171 CLR 506

McNair v Press Offshore Ltd (1997) 17 WAR 191

Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; (1981) 147 CLR 589

Purkess v Crittenden [1965] HCA 34; (1965) 114 CLR 164

Turnor v Squires Transport Pty Ltd [2003] WADC 91

Waddington v Silver Chain Nursing Assn [1998] WASCA 331; (1998) 20 WAR 269

Yates Property Corporation Pty Ltd v Boland [2000] FCA 1106; (2000) 179 ALR 664

Australian Associated Motor Insurers Ltd v NRMA Insurance Ltd [2002] FCA 1061; (2002) 124 FCR 518

Brunsden v Humphrey (1884) 14 QBD 141

Carl Zeiss Stiftung v Raynor & Keeler Limited No 2 [1967] 1 AC 853

Commonwealth v Butler [1958] HCA 56; (1958) 102 CLR 465

Federal Broom Company v Semlitch [1964] HCA 34; (1964) 110 CLR 626

Fishlock v Plummer (1950) SASR 176

Gleeson v J Whippell & Co Ltd [1977] 1 WLR 510

Griffiths v Kerkemeyer [1977] HCA 45; (1977) 139 CLR 161

Keogh v Dom-Uie Pty Ltd, unreported; FCt SCt of WA; Library No 950649; 29 November 1995

Leggett v Argyle Diamond Mines Pty Ltd [2000] WASCA 182

Manners v Transfield Pty Ltd (1992) 8 WAR 111

McKew v Holland & Hannen & Cubbits [1969] UKHL 12; (1969) 3 All ER 1621

Mercer v ANZ Banking Group Ltd [2000] NSWCA 138; (2000) 48 NSWLR 740

Neall v Watson (1960) 34 ALJR 364

Popovski v Ericson Australia Pty Ltd, unreported; SCt of Vic (Ashley J); Library No 4516; 4 September 1998

SGIC v Oakley (1990) ATR 81-003

Stewart v Government Insurance Office (NSW) (1996) 39 NSWLR 531

Sticca v Jouvelet [1988] VicRp 81; [1988] VR 899

Suleski v Sons of Gwalia, unreported; Compensation Magistrate Court (Heath SM); Library No CM 44/98; 8 September 1998

University of Tasmania v Cane [1994] TASSC 73; (1994) 4 TAS R 156

Weeks v Harbourworks Clough (1985) WAR 327

1 MURRAY ACJ: I am much obliged to Templeman and McKechnie JJ to have had access in draft to the judgments prepared by their Honours. I am in general agreement with them, but wish to make some observations on the point principally at issue in the appeal, the question whether and, if so, to what extent the decision of the review officer in the proceedings under the Workers' Compensation and Rehabilitation Act 1981 (WA) gave rise to an issue estoppel binding upon the District Court, when the learned Commissioner of that Court came later to try the respondent's action for damages at common law.

2 The law in relation to when an issue estoppel will arise is clear. It is to be found, conveniently, in the decisions of this Court in McNair v Press Offshore Ltd (1997) 17 WAR 191, Waddington v Silver Chain Nursing Assn [1998] WASCA 331; (1998) 20 WAR 269 and Kuligowski v Metrobus [2002] WASCA 170; (2002) 26 WAR 137 (where the Court was comprised of five judges upon the invitation to review the correctness of its earlier decisions), and the decision of the High Court on appeal from the last-mentioned case, Kuligowski v Metrobus [2004] HCA 34; (2004) 78 ALJR 1031.

3 Put shortly, there are a number of core requirements before an issue estoppel will arise. In the first place, the question on the second occasion which it is contended a party is estopped from litigating again must be the same as that previously decided. Secondly, however the body which previously decided the question is described, its decision must be properly described as a judicial decision. Thirdly, that decision must be of a final rather than an interlocutory character if it is to create an estoppel. If so it may be a decision squarely in respect of a matter directly in issue in the former proceedings, but it may equally be a decision, whether of fact or law, necessarily made on the way to finally deciding the matters at issue in the former proceedings. Finally, an estoppel will only arise to prevent an issue being relitigated between the same parties or their privies.

4 It is convenient to mention at once that, as I understand the appellant's argument, the last-mentioned requirement is accepted to apply, but it is said that, by reason of the fact that the appellant had a different insurer in the workers' compensation proceedings from the common law proceedings, that constituted a special circumstance which the Commissioner ought to have held, despite acceptance of the contrary proposition by the appellant at the trial, prevented the estoppel arising. I agree with Templeman and McKechnie JJ that in the particular circumstances of this case no special circumstance arose in this regard or in matters concerning the reliance placed upon the evidence of the surgeon, Mr Watson.

5 However, I wish to add my expression of doubt that there is any basis upon which, if an issue estoppel would otherwise arise, it may be held by the Court not to do so because of the existence of some special circumstance which would make it unconscientious of the party asserting the estoppel to take the point. I agree that it is unnecessary to finally resolve the question, which is said to arise out of the decision of the House of Lords in Arnold v National Westminister Bank plc [1991] 2 AC 93. But we were referred to no Australian authority endorsing such an exception to the doctrine of issue estoppel and there are a number of expressions of judicial opinion doubting its existence in Australian law.

6 The Australian case upon which the appellant principally placed reliance in this regard was the decision of the Vic Court of Appeal in Linsley v Petrie [1998] 1 VR 427, but the existence of this exception to the doctrine forms no part of the ratio decidendi of that case, where it was held by Hayne JA and Smith AJA that in the circumstances of that case issue estoppel did not arise because the question decided in the former proceedings was not the same as that which arose on the second occasion. Callaway JA, on the other hand, would have relied upon such an exception to the application of the doctrine as that under discussion, and Smith AJA thought it might be possible to do so, although for his Honour the question did not arise. Hayne JA, on the other hand, doubted that there was any such exception to the application of issue estoppel. As his Honour said at 441:

"Such a consideration introduces into an area designed to give certainty and finality to judicial determinations, an unacceptable degree of uncertainty. The whole point of the principles of issue estoppel (and of res judicata and Anshun estoppel) is that there should be an end to litigation and it is for parties so to conduct their litigation that the decisions arrived at (if not overturned on appeal) can be regarded as putting an end once and for all to the problems thus raised."

7 Without finally deciding the point, I must say, with respect, that I am much attracted to this point of view.

8 I proceed then to record briefly my views in respect of the issue estoppel pleaded by the respondent. His original application for compensation was made under the Workers' Compensation Act, s 18. He claimed that he had suffered a disability within the meaning of that Act and that his employer, the appellant, was liable to pay compensation in accordance with Sch 1 of the Act. He put his case that he had suffered a disability on alternate bases. He failed to establish a personal injury by accident arising out of or in the course of the employment under par (a) of the definition of "disability" in s 5(1) of the Act, but he succeeded in establishing, and the review officer found, that he suffered from a "disease" as defined in s 5(1), a physical ailment, disorder, defect or morbid condition in the form of the degenerative condition of his lower spine, involving a liability to disc protrusion. That was found to be a pre-existing disease aggravated or accelerated to a significant degree by his employment with the appellant as a truck driver. That made it a disability within the meaning of par (d) of the definition of that term.

9 It will be seen that in that regard a particular question of causation arose and was determined by the decision of the review officer when he held that the aggravation or acceleration of the back condition was made significantly worse by the contribution of the employment. That necessarily involved a finding rejecting the contention of the appellant that there was no disability because the employment made no significant contribution to the aggravation or acceleration of the back condition which was caused, on the contrary, by the respondent's participation in the sport of basketball.

10 Further, before the review officer the respondent had to establish, in terms of Sch 1 of the Act, that total or partial incapacity for work had resulted from the disability, if an entitlement to weekly payments of compensation was to be established. It appears that the review officer so found and ordered weekly payments of compensation from 18 June 1998 as claimed.

11 The respondent's common law action was essentially a claim for damages for personal injuries against the appellant as his employer on the ground of negligence. There was a claim for breach of an implied term of the contract of employment, but the content of the duty of care said to arise either in that way or in tort was the same. Again, therefore, questions of causation necessarily arose, firstly as to whether the personal injuries which constituted the claimed loss or damage of the respondent were caused by breach of its duty of care by the appellant, and secondly, if so, whether the claimed damages were caused by the injuries sustained.

12 The legal test of causation, both under the Workers Compensation Act and at common law, is the same: Kanowna Bell Goldmines v Feierabend [2003] WASCA 246 and Cole v P & O Ports Ltd [2002] WASCA 157. The proper approach is discussed in the leading authority, March v E & MH Stramare Pty Ltd [1991] HCA 12; (1991) 171 CLR 506 and refined in a number of High Court decisions since then. It is unnecessary to discuss those cases here. It is sufficient to note that causation is essentially a question of fact to be answered by reference to common sense and experience and having regard, where necessary, to considerations of policy and value judgments. The "but for" or causa sine qua non test is not a definitive test of causation necessarily applicable in all cases.

13 Relative to the question of issue estoppel with which the appeal is concerned, the appellant sought to put the question of causation in issue in the common law proceedings by pleading that any injury suffered by the respondent "was sustained when he was playing a game of basketball on the night of Monday 15 June 1998." It was this pleading, effectively of an intervening cause preventing the conclusion that any negligence on the part of the appellant caused the respondent's injuries, which the respondent pleaded in reply gave rise to an issue estoppel as a result of the findings of the review officer.

14 In my view, it is clear that the questions of causation to which I have referred (including that any exacerbation or aggravation of the respondent's back condition in the basketball game did not constitute a novus actus interveniens) which were decided by the review officer, were directly matters ultimately in issue between the parties or necessarily indispensable to the decision of those matters. Those questions so decided arose again in the common law proceedings. They were the same questions to be decided by application of the same tests of causation. In my respectful opinion, the learned Commissioner, as his Honour then was, did not err in so deciding.

15 At the same time the Commissioner recognised that in relation to the assessment of damages further questions of causation arose in the common law proceedings beyond those which had been decided by the review officer. The Commissioner expressly identified the question how the respondent's degenerative back condition would have progressed or affected him absent the contribution to its exacerbation or aggravation of the appellant's negligence. Further, the Commissioner accepted that it was open to test the extent to which other activities of the respondent, including his participation in the sport of basketball, affected or might in future affect his condition. No impediment was placed in the appellant's way in testing those further issues of fact.

16 I agree therefore that the appeal should be dismissed. I have nothing to add in that regard to the judgment of Templeman J in respect of issues raised in the appeal to which I have not adverted.

17 As to the cross-appeal, I too think it should succeed for the reasons given by Templeman J, resulting in the variation of the award of damages proposed by his Honour.

18 TEMPLEMAN J: The principal issue in this appeal is whether a Commissioner of the District Court properly applied the law of issue estoppel when trying an action for damages for personal injuries brought by a worker against his employer, when findings of causation relating to those injuries had been made previously by a review officer in the context of an application for workers' compensation. The learned Commissioner held that the employer was estopped from re-agitating the question of causation. He awarded damages to the worker. The employer appeals on the question of issue estoppel. The worker cross-appeals on the quantum of damages.

19 Noel Percy Turnor, the respondent, was employed by Squires Transport Pty Ltd ("Squires") as a truck driver. Mr Turnor claimed that in November - December 1997 he suffered a ruptured disc in his lower back while driving a truck with a seat which had been modified to make it rigid. The springs beneath the seat had been welded. Despite his injury, Mr Turnor continued working until June 1998, when he suffered a back injury when playing a social game of basketball. He then became unable to work.

20 Mr Turnor claimed weekly payments under s 18 of the Workers' Compensation and Rehabilitation Act 1981 ("the Workers' Compensation Act"). In order to make good his claim, Mr Turnor had to prove that he had a disability within the definition provisions of s 5. Relevantly, for present purposes, "disability" is defined to mean:

"(a) a personal injury by accident arising out of or in the course of the employment, or whilst the worker is acting under the employer's instructions;

...

(c) a disease contracted by a worker in the course of his employment at or away from his place of employment and to which the employment was a contributing factor and contributed to a significant degree;

(d) the recurrence, aggravation, or acceleration of any pre-existing disease where the employment was a contributing factor to that recurrence, aggravation, or acceleration and contributed to a significant degree."

21 Mr Turnor's claim was disputed by Squires which contended that his injury was not work related but was caused by playing basketball. In due course, the dispute was referred to a review officer pursuant to Division 3, Part IIIA of the Workers' Compensation Act.

22 On 29 October 1999 the review officer gave his decision. He held that, on the balance of probabilities, Mr Turnor "suffered a lower back problem, activated by the truck driving and worsened by his basketball activities, resulting in his incapacity".

23 The review officer said he had seen no evidence which would permit a finding that Mr Turnor had suffered a personal injury by accident in the course of his employment. Nor was the evidence capable of supporting a finding that Mr Turnor contracted a disease in the course of his employment. The review officer continued:

"It then remains for (Mr Turnor) to show that he has suffered a recurrence, aggravation, or acceleration of any pre-existing disease where the employment was a contributing factor to that recurrence, aggravation or acceleration and contributed to a significant degree. There is radiological evidence of a pre-existing disease and I find that (Mr Turnor) did have L5/S1 disc degeneration with a shallow broad based posterior disc protrusion ...."

24 In concluding his reasons, the review officer noted that Mr Turnor had engaged in games of basketball but said he did not think that was a factor which should prevent a finding that Mr Turnor's employment contributed to a significant degree to his disability. Thus, the review officer concluded:

"I find therefore on the balance of probabilities that (Mr Turnor) has suffered a recurrence, aggravation or acceleration of a pre-existing disease where the employment was a contributing factor to that recurrence, aggravation or acceleration and contributed to a significant degree."

25 Mr Turnor then brought an action against Squires in the District Court. He alleged breach of an implied term of his contract of employment that Squires would exercise reasonable care for his safety during the course of that employment and would provide him with safe work equipment. In what appears to have been an alternative claim, Mr Turnor alleged that his injuries were caused by Squires' negligence in causing and permitting the driver's seat of the truck to be rigidly fixed which subjected Mr Turnor's lumbar spine "to frequent and repetitive jolting and jarring".

26 Squires defended the action on the basis that Mr Turnor suffered from "a pre-existing low back condition", ie before he commenced his employment. Squires alleged Mr Turnor had told one of its Directors about his problem; that he had lived with the injury for a long time and that any aggravation would be "my problem". Squires asserted further that any injury which might have been suffered by Mr Turnor resulted from his playing basketball in June 1998.

27 Squires contended also that Mr Turnor was estopped from claiming that he had injured his back during his employment with Squires because in the review proceedings, the review officer had held that there was no evidence which would allow a finding that Mr Turnor had suffered a personal injury by accident in the course of that employment.

28 In his reply, Mr Turnor contended that Squires was estopped by the review officer's findings from pleading the denials of liability referred to above. The relevant findings were that Mr Turnor had suffered a lower back problem "activated by the truck driving and worsened by his basketball activities resulting in his incapacity" and that Mr Turnor had suffered a recurrence, aggravation or acceleration of a pre-existing disease where the employment was a contributing factor and contributed to a significant degree.

29 The issue estoppel issue was raised at an early stage in the trial. The learned Commissioner gave rulings which he later incorporated in the following passage of his reasons:

"The starting point in deciding this preliminary issue of issue estoppel in relation to the workers' compensation proceedings is recognition that a determination of a review officer under the Act is a judicial determination in the relevant sense. See McNair v Press Offshore Pty Ltd & Anor (1997) 17 WAR 191 and Kuligowski v Metrobus [2002] WASCA 170."

30 Following the Commissioner's decision, Kuligowski v Metrobus [2002] WASCA 170; (2002) 26 WAR 137 went on appeal to the High Court: Kuligowski v Metrobus [2004] HCA 34; (2004) 78 ALJR 1031. The High Court held that the decision of a review officer was final (notwithstanding s 60 of the Act, whereby weekly payments of compensation might be discontinued or reduced, following the order of a review officer) and could give rise to an issue estoppel where the issue in the later proceedings was identical to that in which the estoppel was said to have arisen: see par 37 to par 48.

31 In ground 5 of its grounds of appeal, Squires contends that the Commissioner erred in law in finding that the determination of the review officer was a final determination. In the light of the decision of the High Court in Kuligowski v Metrobus, there can be no substance to that ground.

Has an issue estoppel arisen in the present case?

32 In considering whether an issue estoppel had arisen, the Commissioner said:

"The review officer did not disregard the basketball activities engaged in by the plaintiff. He found that the plaintiff's lower back problem activated by the truck driving was worsened by his basketball activities. In my view the review officer clearly rejected the defendant's case that the plaintiff's low back problem was solely caused by him playing basketball including the game on 15 June 1998. Such rejection is in my view indispensable to the ultimate conclusion reached by the review officer. Further, in my view, it is indispensable to the review officer's ultimate conclusion that the plaintiff's low back problem was causally connected to him driving the truck with the rigid driver's seat.

In my view it is now not open to the defendant in these proceedings to deny that the plaintiff when in the employ of the defendant drove a truck with a rigid driver's seat and that the rigid seat caused jolting to the plaintiff's lower back which in turn produced low back symptoms and symptoms associated to his low back. It is also not open to the defendant to allege or ask questions about the plaintiff playing basketball for the purpose of establishing that it broke the chain of causation or in other words that it was the sole cause of the plaintiff's low back disability.

In my view the review officer's decision did not preclude the defendant in these proceedings from asking questions for the purpose of showing the extent to which playing basketball has in the past exacerbated the plaintiff's low back symptoms caused by him driving the truck with the rigid seat and the extent, if any, to which it still does so and may do so in the future."

33 In other words, the Commissioner held that it was not open to Squires to contend that Mr Turnor's low back problem was caused solely by playing basketball. That was because Mr Turnor's employment had contributed to the recurrence, aggravation or acceleration of his pre-existing disease, to a significant degree. Thus, the playing of basketball could not have been the sole cause of Mr Turnor's disability: and Squires was estopped from asserting the contrary.

34 Put another way, the injury suffered by Mr Turnor during the basketball game in June 1996, was not a novus actus interveniens.

35 That was not to say, however, (and the Commissioner did not say) that Squires was estopped from contending that the basketball (while not a sole cause of Mr Turnor's disability) had contributed to his symptoms. This is clear from the following passage in the Commissioner's judgment in which his Honour said:

"It follows from all of this that key issues to be determined by me include whether or not the defendant was negligent, whether or not the defendant is in breach of a contract of employment, contributory negligence, how would the plaintiff's pre-existing condition have affected him but for its recurrence, aggravation or acceleration as a result of him driving the truck with a rigid seat and also to what extent if any did the plaintiff's basketball activities exacerbate his low back disability and associated symptoms caused by him driving the truck with the rigid seat and to what extent, if any, will it do so in the future and where should the liability fall in relation to that."

The grounds of appeal relating to issue estoppel

36 Grounds 1, 2, 3, 7 and 10 of Squires' further amended notice of appeal overlap to a considerable extent. In essence, it is contended in those grounds that the Commissioner erred in holding that further argument as to causation, at common law, of Mr Turnor's ultimate injuries was not open and in failing to find that the injuries sustained by Mr Turnor when playing basketball was not a novus actus interveniens.

37 The underlying complaint in relation to these grounds is contained in ground 3 where it is contended that the Commissioner:

"Erred in fact and law in failing to make any or any proper enquiry as to:

(a) what was judicially determined by the ... review officer; and

(b) which conclusions of the review officer were judicially indispensable for the purposes of his determination."

38 In Blair v Curran [1939] HCA 23; (1939) 62 CLR 464 at 532, Dixon J, in drawing a distinction between res judicata and issue estoppel said that in the latter:

"For the purpose of some claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order.

Nothing but what is legally indispensable to the conclusion is thus finally closed or precluded .... The judicial determination concludes, not merely as to the point actually decided, but as to a matter which it was necessary to decide and which was actually decided as the ground work of the decision itself, though not then directly the point in issue. .... Matters of law or fact which are subsidiary or collateral are not covered by the estoppel. Findings, however deliberate and formal, which concern only evidentiary facts and not ultimate facts forming the very title to rights give rise to no preclusion."

39 In the present case, it was necessary for the review officer to decide whether Mr Turnor's disability was caused solely by the game of basketball he played in June 1996. If that was the sole cause, then Mr Turnor could not have been entitled to receive workers' compensation. The review officer did approach the matter in that way. His finding was clear: and that finding was "legally indispensable" to the conclusion reached by the review officer that Mr Turnor was entitled to compensation. The Commissioner recognised this in the passage in his reasons which I have set out above.

40 That being so, in my view, it was not open to Squires to attempt to litigate the question in the District Court proceedings.

41 Ground 4 raises different considerations. It is in the following terms:

"4. further or in the alternative, in so far as the Commissioner's decision is capable of being interpreted as determining that the driving caused the Respondent's (Plaintiff's) back injury, the Learned Commissioner:

(a) was estopped from making that finding by reason of the findings of Review Officer Cocker in the Conciliation and Review Directorate; and

(b) was wrong in fact and in law:

(i) the Commissioner's determination excludes any argument as to the generally accepted 'but for' test of causation and excludes any legal argument as to whether or not the Respondent's (Plaintiff's) disability would have occurred 'but for' the Appellant's (Defendant's) negligent act; and

(ii) denies any argument or investigation as to whether the act of playing basketball in his condition as determined by the Commissioner constituted a novus actus interveniens;

(iii) denies any enquiry as to the 'common sense' test of causation;

(c) Arrived at his Decision apparently on the merits notwithstanding that the Respondent's (Plaintiff's) case was presented on the basis that the Appellant (Defendant) was not entitled to cross-examine the Respondent (Plaintiff) or his witnesses as to the lack of causal connection between the Respondent's (Plaintiff's) ultimate disability and the driving of the truck."

"The truck driving in November/December 1997 caused a disc protrusion sufficient to in turn cause sciatic pain down the right leg to the knee. The plaintiff continued to suffer these symptoms to June 1998. By the time he played basketball in June 1998 and particularly on 15 June 1998 the protruded disc had been and was rendered more vulnerable to exacerbation. The disc protrusion was exacerbated as a result of the basketball game on 15 June 1998. This caused a significant increase in the plaintiff's overall symptoms and the pain extended down the right leg to the ankle. In the circumstances such as this the disc protrusion in November/December 1997 and exacerbation of it during the basketball game on 15 June 1998 should be treated as caused by the negligence of the defendant. See State Government Insurance Commission v Oakley (1990) A Tort Rep 81-003 at p 62,577."

43 A little later in his reasons, the Commissioner said:

"There is no material conflict between my findings and those reached by the review officer that were indispensable to his ultimate conclusion. Therefore it is not necessary to further consider the effects of the review officer's decision and issue estoppel arising therefrom for the purpose of deciding this case."

44 In my view, the Commissioner was correct to say that there was no material conflict between his findings and those reached by the review officer. As I have noted above, the review officer held, in substance, that the injuries sustained by Mr Turnor when playing basketball was not a novus actus interveniens. Subject to that, the question of causation remained open. The Commissioner expressed that conclusion in the following terms:

"In the final analysis while I find that the review officer's decision gives rise to estoppel on certain key issues including in particular that the plaintiff suffered a disability of his low back activated by the truck driving and worsened by his basketball activities and that he had a continuing incapacity for work as at the time of the hearing of the workers' compensation proceedings, the final outcome of this case does not turn one way or the other on issue estoppel."

45 The finding by the review officer that the injuries sustained by Mr Turnor playing basketball was not a novus actus interveniens was not the end of the matter. It was still necessary for Mr Turnor to prove that Squires' actions had caused his damage. As the High Court said in Kuligowski v Metrobus (supra) at [60]:

"A failure to find a matter alleged does not establish the truth of the contrary of that which is alleged."

46 Thus, the review officer's "failure" to find that Mr Turnor's disability was caused solely by playing basketball, does not establish that it was caused by Squires.

47 The review officer's conclusion did, however, rule out the "but for" test of causation to which Squires refers in the particulars of ground 4(b) above. This test was considered in March v E & M H Stramare Pty Ltd [1991] HCA 12; (1991) 171 CLR 506, where the High Court held that the "but for" test is not a definitive test of causation which is essentially a question of fact to be answered by reference to commonsense and experience. In the present case, the "but for" test was inappropriate, given the review officer's findings.

48 In fact, the Commissioner approached the question of causation "totally ignoring the review officer's decision and the questions of issue estoppel arising from it" (AB 61).

49 Mr Turnor accepts (rightly) that this was an erroneous approach. However, it is of no consequence because the Commissioner reached the same conclusion as the review officer in holding that the exacerbation of Mr Turnor's condition from playing basketball was not a novus actus interveniens (AB 66).

51 As to ground 4(c): the Commissioner's ruling that Squires was not entitled to cross-examine Mr Turnor or his witnesses as to the lack of causal connection between Mr Turnor's ultimate disability and the driving of the truck, was, in my view, entirely appropriate. It is to be emphasised, however, that the Commissioner did not prevent cross-examination to explore the extent to which driving the truck and playing basketball respectively contributed to Mr Turnor's symptoms.

52 The theme underlying ground 4 is implicit in ground 6 also. It is there contended that:

"The learned Commissioner determined that the negligence of (Squires) had rendered (Mr Turnor) more vulnerable to injury but wrongly awarded damages on the basis that that vulnerability constituted the actual injury."

53 I do not think it correct to say that the Commissioner awarded damages "on the basis that vulnerability constituted the actual injury".

54 I have set out above, the Commissioner's conclusion that the disc protrusion suffered by Mr Turnor as a result of driving the truck was more vulnerable to exacerbation by June 1998 when he played basketball.

55 However, damages were not awarded on the basis of Mr Turnor's vulnerability, but because he had suffered a disc protrusion causing pain, as a result of Squires' negligence and breach of contract. The disc protrusion was exacerbated by Mr Turnor playing basketball in June 1998.

57 In ground 8, Squires contends that the Commissioner:

"8. further and in the alternative, should have found that the decision of the Review Officer did not estop the Appellant (Defendant) from relitigating the question of causation by reason of the existence of special circumstances:

(a) although the parties to the action below were nominally the same as those in the Conciliation and Review Directorate, the employer in the Directorate was indemnified by its workers compensation insurer, the State Government Insurance Office while the defendant below was indemnified by the Insurance Commission of Western Australia;

(b) the finding at the Conciliation and Review Directorate should not have bound the Insurance Commission of Western Australia which was not involved in that litigation; and

(c) the opinion upon which the Review Officer, namely that of Neurosurgeon Mr Peter Watson, was given without knowledge of the Respondent's (Plaintiff's) involvement in and injury sustained during a game of basketball in June 1998 and

(i) should not have been accorded any weight;

(ii) provided grounds for concluding that the decision of the Review Officer was not for relevant purposes final; and/or

(iii) undermined the reliability of the decision which was relied upon to create the estoppel."

58 The question whether the existence of some special circumstance should be permitted to prevent a party from relying on an estoppel who would otherwise be permitted to do so was raised in Arnold v National Westminister Bank plc [1991] 2 AC 93, in the speech of Lord Keith at p 104. As Lord Keith said, the basis for a possible exception arises from the judgment of Wigram VC in Henderson v Henderson [1843] EngR 917; (1843) 3 Hare 100; (1843) 67 ER 313 at 11405 where his Lordship said:

" ... where a given matter becomes the subject of litigation in, and of adjudication by, a court of competent jurisdiction, the court requires the parties to that litigation to bring forward their whole case and will not (except under special circumstances) permit the same parties to open the same subject of litigation in respect of matter which might have been brought forward as part of the subject in contest, but which was not brought forward, only because they have, from negligence, inadvertence, or even accident, omitted part of their case." (my emphasis)

59 In Yates Property Corporation Pty Ltd v Boland [2000] FCA 1106; (2000) 179 ALR 664, Goldberg J noted that the "special circumstances" exception to the operation of the doctrine of issue estoppel had been doubted in Australia (as it had also in relation to Anshun estoppel: see Port of Melbourne Authority v Anshun Pty Ltd [1981] HCA 45; (1981) 147 CLR 589).

60 In Chamberlain v Deputy Commissioner of Taxation [1988] HCA 21; (1988) 164 CLR 502 at 504, Brennan J said he did not regard Wigram VC as advancing any exception to the doctrine of issue estoppel but as referring to the equity practice of the day which permitted an earlier judgment to be impeached in special circumstances. In O'Toole v Charles David Pty Ltd (1991) 171 CLR 232 at 258, Brennan J referred to Arnold v National Westminister Bank PLC (supra) as a case which rested on "an uncertain foundation".

61 In Linsley v Petrie [1998] 1 VR 427, the Victorian Court of Appeal considered a possible equitable exception to the doctrine of issue estoppel which might arise where (for example) an insurer who is subrogated to the rights of the insured, has conducted litigation in the insured person's name. In such circumstances, the insured person might be estopped from raising in subsequent litigation issues decided in earlier proceedings over which he or she had no control. Would equity intervene to prevent an injustice arising in such circumstances?

62 That is not a question which this Court is required to answer because this is not a subrogation case. No doubt for that reason, counsel for Squires expressly disavowed any reliance on equity during the course of the argument (TS 73).

63 In my view, the matters referred to in par (a) and (b) of the particulars of ground 8 of the grounds of appeal are not special circumstances in any event. The fact that Squires was indemnified by its insurer is, I think, irrelevant. That is because the insurer was undoubtedly Squires' privy and was therefore bound, irrespective of the extent of its involvement in the actual conduct of the proceedings.

64 But in my view, all of this is academic. That is because at the hearing before the Commissioner, counsel for Squires accepted (correctly) that "estoppel is created by the decisions of review officers" (TS 7). Thus, the estoppel is equally binding on Squires and the insurer which is its privy.

65 The contention in par (c) of the particulars of ground 8 is factually incorrect. It appears from Mr Watson's evidence that he had been aware of the exacerbation of Mr Turnor's symptoms by playing basketball in mid June 1998 (AB 209). Mr Watson referred to the basketball in a report dated 8 April 1999 to SGIO Insurance.

66 In my view, therefore, there is no substance to ground 8.

67 The factual error in ground 8 is carried forward into grounds 11 - 14 inclusive. In essence, it is contended in those grounds that the Commissioner made findings of fact against the evidence and relied on the evidence of Mr Watson when he should have preferred the evidence of Mr Philip Hardcastle and Mr Ratan Edibam, orthopaedic surgeons.

68 Squires contends that the Commissioner's finding that Mr Turnor suffered from sciatic pains before playing basketball was an error, when there was no evidence to that effect. Alternatively, it is said, that finding was against the weight of the evidence.

69 It is true that Mr Watson's opinion that Mr Turnor had suffered a disc protrusion by January 1998 which caused him to experience sciatic pains was based on the history given to him by Mr Turnor. However, the Commissioner accepted Mr Turnor as a credible and reliable witness (AB 58 & 62). Indeed, the Commissioner found as a fact that Mr Turnor was experiencing sciatic pain between November 1997 and 12 June 1998 (AB 62).

70 The opinion of Mr Hardcastle and Mr Edibam was that Mr Turnor's symptoms were more likely to have been facet joint pain and that the disc protrusion occurred only after he had played basketball.

71 The Commissioner reviewed the medical evidence in detail. He gave clear and comprehensive reasons for preferring the evidence of Mr Watson over that of Mr Eddibam and Mr Hardcastle and pointed out the inconsistencies in their evidence (AB 64-5). I can see no error in the Commissioner's approach, nor in his conclusions.

72 Further, I do not think it open to Squires to contend that Mr Watson's evidence should be rejected, when it was not put to him in cross-examination that Mr Turnor's pre-basketball symptoms were inconsistent with sciatica, and that, accordingly, his post-basketball symptoms should be attributed to injury suffered during that game. Although the Commissioner had ruled out cross-examination for the purpose of exploring whether the basketball game was the sole cause of Mr Turnor's injury, it remained open to counsel for Squires to cross-examine for the purpose of exploring the extent of any exacerbation of Mr Turnor's symptoms as a result of playing basketball.

73 In my view, therefore, there is no merit in grounds 11 - 14 inclusive.

74 Ground 15 is a compendious ground. It adds nothing to those considered above.

75 For all these reasons, I conclude that the appeal should be dismissed.

76 The Commissioner calculated Mr Turnor's past economic loss from 18 June 1998 to trial at $156,318. To that figure, his Honour applied a discount of 20 per cent:

" ... to take account of retained earning capacity, the chance that (Mr Turnor's) pre-existing degenerative condition could have been rendered symptomatic anyway and the usual contingencies over the time period of the past loss." (AB 71)

77 For the same reason, the Commissioner applied a discount of 20 per cent to the past loss of Mr Turnor's superannuation benefits.

78 Mr Turnor appeals against that aspect of the Commissioner's decision on the following grounds:

"(a) The 20% discount was expressed to take account of 'retained earning capacity' when on the evidence it was not open to conclude that the Respondent (Plaintiff) had any opportunity to exercise any retained capacity in the pre-trial period.

(b) It was not appropriate to apply a discount to the awards for past loss when it was not established on the balance of probabilities that the pre-existing degenerative condition would have caused incapacity for work in the pre-trial period.

(c) In any event a discount of 20% was inordinately high in the circumstances and was not within the bounds of a sound discretionary judgment."

79 The Commissioner's reasons for applying a discount of 20 per cent were as follows:

"I find that when the plaintiff started working for the defendant in November 1997 he had advanced long-standing degenerative change at the L5/S1 level. Degeneration is a pre-requisite for a disc protrusion to occur. The plaintiff had a relatively severe back injury in 1994 requiring time off work. Although the plaintiff was asymptomatic when he started working for the plaintiff the fact of the matter is that he was vulnerable to a back injury and more so if undertaking heavy work. Indeed shortly before September 2001 when he was not working he started to experience referred pain in to the left leg down to the knee. I repeat my finding that this is not causally linked to him driving the truck. I accept the plaintiff's evidence that his left leg pain was nowhere near as severe as his right leg pain and that it has eased off in recent months.

The plaintiff would not have been able to drive a truck for the defendant for three months from sometime in May 1998 because of a demerit point disqualification. Mr Squires said that he paid the plaintiff by the hour and it seems that he did not have enough work in 1998 to keep the plaintiff fully occupied in driving. Therefore some discount needs to be made to cover periods when the plaintiff might have worked reduced hours or at a reduced rate. He might not have become Mr Squires' second-in-command. Further, given that the period for past economic loss is relatively long, about four and a half years, some discount needs to be made for the usual contingencies over this period."

80 Although it is true that Mr Turnor was vulnerable to back injury when he started working for Squires, the extent of that vulnerability was not raised in the pleadings and was not, therefore, the subject of any evidence. In any event, Mr Turnor's vulnerability made it more likely that if he was to become disabled, it would be as a result of his employment, leading to an entitlement to compensation.

81 In cases of this kind, it is common for successful plaintiffs to be awarded only the monetary sum they would have earned. Payment is usually made long after the events in question but without interest. This is commonly regarded as sufficient to counterbalance any adverse contingencies.

82 It is true that Mr Turnor was unable to drive for three months from May 1998 because of a disqualification. However, in the present case, the contingencies were not all adverse. Although, as the Commissioner said, Mr Turnor might not have become Mr Squires' second-in-command, there was a possibility that he might have been promoted to that position. Mr Squires spoke very highly of Mr Turnor. Had he been so appointed, Mr Turnor would have earned more than he did as a truck driver.

83 In all the circumstances, I consider that the discount of 20 per cent applied by the Commissioner was excessive and reflects error. Having regard to the long interval between damage and trial, and the at least semi-counterbalancing contingencies, I would consider it inappropriate to discount Mr Turnor's past economic loss. I would restore the award under that to $156,318, but not allow interest.

84 For the same reason, I would increase the award of past loss of superannuation from $9,111 to $11,389.

85 The Commissioner assessed Mr Turnor's total future economic loss, before any deductions, to be $540,452. As his Honour said, it was necessary to discount that figure:

"to take account of retained earning capacity, the possibility that but for the truck driving injury (Mr Turnor's) pre-existing advanced degenerative condition of his lumbar spine would have rendered him symptomatic and incapable of work anyway and the usual contingencies." (AB 72)

86 The Commissioner accepted Mr Hardcastle's evidence to the effect that people with advanced longstanding degeneration of the lumbar spine, such as Mr Turnor, are much more vulnerable to traumatic advance between the ages of 40 and 60 years than before or after that age range. Mr Turnor was nearly 40 years of age at the time and therefore fell into the category of greater vulnerability. Having regard to the fact that Mr Turnor had started to experience pain in his left leg from some time shortly before September 2001 when he was relatively inactive, the Commissioner felt that there was a greater possibility of his becoming symptomatic and incapable of truck driving sooner rather than later.

87 Counsel for Mr Turnor had submitted that no greater discount than 35 per cent should be applied to take account of retained earning capacity and contingencies. However, The Commissioner was of the view that the proper discount for Mr Turnor's retained earning capacity was 30 per cent and that the proper discount for the possibility of the pre-existing condition rendering him symptomatic and incapable of truck driving or other heavy work, should be 30 per cent. Thus, the Commissioner applied a discount of 60 per cent.

88 Mr Turnor appeals against that part of the Commissioner's decision on the following grounds:

"(a) The discount for retained capacity of 30% was excessive particularly in the light of the Respondent's (Plaintiff's) evidence to the effect that he had embarked upon a genuine vigorous and unsuccessful search for suitable alternative work in the pre-trial period.

(b) There was no evidence that there was employment suitable, open and available to the Respondent (Plaintiff) in his injured state in the area in which he lived, namely Albany.

(c) The discount of 30% for the possibility of the pre-existing degeneration rendering the Respondent (Plaintiff) symptomatic and incapacitated for truck driving and for other contingencies was inordinately high and out of the range of a sound discretionary judgment given that such contingencies were highly speculative.

(d) The discounting process embarked upon by the Learned Commissioner in applying two discounts of 30% in separate stages produced an overlap in the discounting process resulting in any event in an excessive overall discount."

89 Mr Turnor contends that Squires did not plead that Mr Turnor's pre-existing condition would have disabled him: nor did Squires lead evidence to discharge the onus of proving that would have been the case.

90 Mr Turnor relies on Watts v Rake [1960] HCA 58; (1960) 108 CLR 158 and Purkess v Crittenden [1965] HCA 34; (1965) 114 CLR 164. Those decisions are authority for the proposition that Squires did have an evidential onus of proving the nature of the pre-existing condition and the prognosis, on the basis that there was no injury. However, as Barwick CJ, Kitto and Taylor JJ said in their joint judgment in Purkess v Crittenden (at p 168) relevant evidence might either be substantive evidence in the defendant's case or evidence extracted by cross-examination in the plaintiff's case.

91 It is true that evidence will only become admissible if relevant: and it will be relevant only to an issue which arises on the pleadings. However, in the present case, although there was no relevant pleading, Mr Hardcastle's evidence appears to have been given without objection and the Commissioner was entitled to rely on it.

92 I do not think the Commissioner can be criticised for allowing a discount of 30 per cent to allow for Mr Turnor's retained earning capacity when, despite his evidence about his unsuccessful attempts to obtain suitable alternative work, his counsel accepted that a discount of 35 per cent might be appropriate, albeit to allow for retained earning capacity and contingencies.

93 However, I think there is merit in Mr Turnor's contention that allowing discounts of 30 per cent for both retained earning capacity and the possibility of his pre-existing condition rendering him unfit for work, involves an element of double counting and therefore reflects error.

94 In all the circumstances, and giving weight to Mr Hardcastle's opinion, I would regard a discount of 40 per cent as appropriate. I would therefore increase Mr Turnor's award of damages for future economic loss from $216,180 to $324,271.

95 For the same reasons, I would increase the award for future loss of superannuation from $18,431 to $27,646.

96 I would therefore allow the cross-appeal by increasing the award of damages to $637,384.73.

97 MCKECHNIE J: I agree generally with Templeman J in his reasons for dismissing the appeal. In the search for principles governing issue estoppel as raised in this appeal, it is unnecessary to go further than Kuligowski v Metrobus [2004] HCA 34; (2004) 208 ALR 16 a decision of the Full High Court delivered less than three weeks before this appeal was argued.

98 In the present case, no question arises as to the powers of the Review Officer to make orders. Kuligowski is authority for the following principles:

• The Review Officer's decision was a final decision.

• The same question or issue which arose in the District Court action must have been identical to that decided by the Review Officer.

• A judicial determination concludes, not merely as to the point actually decided, but as to a matter which it was necessary to decide and which was actually decided as the groundwork of the decision itself, though not then directly the point at issue.

99 Squires Transport Pty Ltd carried on a trucking business. Mr Turnor was employed from 1 November 1997 to drive one of the trucks, an eight-wheeler Leda truck. The driver's seat of the truck had been modified and was rigidly fixed to the chassis rather than being supported by a spring suspension system.

100 In June 1998, following a basketball game, Mr Turnor experienced low back pain which worsened to such an extent that he is now unable to carry on most fields of employment, especially truck driving.

101 Mr Turnor claimed weekly payments and statutory allowances under the Workers' Compensation and Rehabilitation Act 1981 on the basis that he had suffered a disability which occurred whilst employed by Squires Transport, the disability being a ruptured disc.

102 It was necessary for Mr Turnor to establish that he had sustained a disability as defined under the Act.

103 The parties being unable to agree, the matter went before a Review Officer, M C Cocker. In the written reasons for decision the Review Officer noted at [37]:

"The first issue to be determined in this matter is the causation of the worker's injury..."

"The applicant submits that he has sustained a disability in the course of his employment between November 1997 and June 1998 which has resulted in incapacity commencing between 16 and 18 June 1998..."

105 The Review Officer noted a further submission at [59]:

"It is submitted that there is no evidence to either support a finding that the worker's involvement in the basketball game on 15 June 1998 is the cause of the worker's incapacity, or that it has broken the chain of causation between the disability sustained by the worker in the course of his employment and in the incapacity flowing from that. There is no evidence, and in particular medical evidence, in support of that whatsoever. Therefore no finding can be made in that regard."

106 The submission on behalf of Squires Transport was at [64]:

"...I should make a finding that the basketball game caused the worker's incapacity and that therefore no disability was suffered in the course of his employment or in the alternative that in the face of very clear evidence of no incapacity in the course of employment and no need for treatment until the incident occurred during the game of basketball the application should be dismissed."

107 In his conclusions, the Review Officer was unable to reach a finding that Mr Turnor was not a credible witness. At [72] he said:

"The respondent seeks a finding that the basketball game caused the worker's incapacity but this is not supported by the medical evidence and is in fact contrary to the views of Mr Watson and to a lesser extent of Dr Augustson."

"I find that on the balance of probabilities the worker suffered a lower back problem, activated by the truck driving and worsened by his basketball activities, resulting in his incapacity."

109 This finding is not put in issue in this appeal.

110 The Review Officer then determined that there was evidence of a pre-existing disease, namely L5/S1 disc degeneration, and considered various matters under the Act:

"[82] The likelihood of the recurrence, aggravation or acceleration of the disease occurring despite the employment.

It is under this heading that the employer seeks to maintain that the basketball game should prevent a finding that the worker has suffered a disability. I am unable to agree, believing that the basketball game should more appropriately be placed for consideration under activities of the worker not related to the employment. Under this particular heading no matters arise for consideration. It is probable that this heading was intended to include a matter such as the sudden and distinct physiological change occurring as a result of the inevitable development of a progressive disease."

"I find therefore on the balance of probabilities that the worker has suffered a recurrence, aggravation or acceleration of a pre-existing disease where the employment was a contributing factor to that recurrence, aggravation or acceleration and contributed to a significant degree. It follows therefore that Mr Turnor is entitled to compensation and I make the following orders:

1. That the respondent pay the applicant weekly payments as from 18 June 1998 and continuing.

2. That the respondent pay the applicant's statutory allowances."

112 In the District Court proceedings, Mr Turnor pleaded issue estoppel by way of reply.

113 The Commissioner upheld the plea. It is common ground that as a result Squires Transport was unable to put its case in respect of the matters covered by the plea.

114 The Commissioner set out his reasons. In the course of his judgment, Turnor v Squires Transport Pty Ltd [2003] WADC 91, after referring to the Review Officer's reasons, he held:

"23. It is important to note that par (d) of the definition of 'disability' requires the employment to be 'a' contributing factor to the recurrence, aggravation or acceleration of the pre-existing disease. Therefore the employment does not have to be the sole factor.

24. The review officer did not disregard the basketball activities engaged in by the plaintiff. He found that the plaintiff's lower back problem activated by the truck driving was worsened by his basketball activities. In my view the review officer clearly rejected the defendant's case that the plaintiff's low back problem was solely caused by him playing basketball including the game on 15 June 1998. Such rejection is in my view indispensable to the ultimate conclusion reached by the review officer. Further, in my view, it is indispensable to the review officer's ultimate conclusion that the plaintiff's low back problem was causally connected to him driving the truck with the rigid driver's seat.

25. In my view it is now not open to the defendant in these proceedings to deny that the plaintiff when in the employ of the defendant drove a truck with a rigid driver's seat and that the rigid seat caused jolting to the plaintiff's lower back which in turn produced low back symptoms and symptoms associated to his low back. It is also not open to the defendant to allege or ask questions about the plaintiff playing basketball for the purpose of establishing that it broke the chain of causation or in other words that it was the sole cause of the plaintiff's low back disability.

26. In my view the review officer's decision did not preclude the defendant in these proceedings from asking questions for the purpose of showing the extent to which playing basketball has in the past exacerbated the plaintiff's low back symptoms caused by him driving the truck with the rigid seat and the extent, if any, to which it still does so and may do so in the future."

115 In the way in which proceedings were conducted before the Review Officer, it was necessary for him to find whether the employment of Mr Turnor, in the circumstances outlined, was causally connected to his disability or whether the disability was caused by playing basketball. There is a precise identity between these matters and issues raised in the District Court action. The Commissioner carefully identified the precise issues which had been decided by the Review Officer to which he considered the estoppel applied. In my opinion, he was correct in his conclusion. The precise issues impliedly or necessarily found by the Review Officer were issues necessarily to be determined in the District Court action.

Squires Transport Pty Ltd v Turnor [2004] WASCA 245

At a glance

Court

Decision date

Before

Catchwords

Source

Catchwords

Judgment (225 paragraphs)

Squires Transport Pty Ltd v Turnor [2004] WASCA 245 (3 November 2004)

Has an issue estoppel arisen in the present case?

The grounds of appeal relating to issue estoppel

Parties

Legislation Cited (1)

Cases Cited (24)