These proceedings were listed for a final hearing to commence on 10 October 2022, with an estimated duration of 10 hearing days. The proceedings had been case managed by Cavanagh J on two occasions - in May and June 2022.
Last week the proceedings came before the Chief Judge at Common Law, when further issues were raised including a possible issue in these proceedings as to the lawful basis upon which the NSW insurance fund, commonly known as iCare, might be entitled to recover approximately $1.7 million which it had paid to the plaintiff, or on his behalf, by way of costs and expenses incurred by him as a consequence of the accident which he suffered and upon which these proceedings are brought.
An application is now made for an adjournment of the hearing of the proceedings.
It is necessary to give a little context to the matter with which I am about to deal and to outline a few facts which I do for the purpose of this application and on the basis of the limited material before me.
[2]
The Proceedings
The plaintiff commenced proceedings in 2020 claiming damages for negligence from the first defendant, Super Seasons Pty Ltd, arising from an accident which occurred on 13 July 2017, whilst he was picking fruit at an orchard owned and operated by the first defendant at Hillston in the State of New South Wales.
Tam v Super Seasons Pty Ltd [2022] NSWSC 1366 | Case summary | Zoe
As a consequence of that fall, the plaintiff was rendered a C5 quadriplegic. He has total loss of lower and upper limb function.
The plaintiff, a citizen of Malaysia, had come to Australia prior to that time and was working for a labour hire company known as Mr Handy Professor Pty Ltd, a name commonly shortened to MHP. After the accident, and prior to the commencement of proceedings, MHP was deregistered. As a consequence of that deregistration, and the fact that the plaintiff was employed by MHP, the Statement of Claim was amended pursuant to an order of this Court on 2 November 2020 to add the Victorian WorkCover Authority as the second defendant.
It was, according to the amended pleading, sued because MHP held a worker's compensation insurance policy with it. On 17 March 2021, the Victorian WorkCover Authority as the second defendant filed a Defence, in which it admitted that the plaintiff was sent by MHP to the orchard to pick fruit and that whilst there, he had a fall and sustained injuries and otherwise denied all relevant issues surrounding the accident.
In paragraph 27 of the Defence, it pleaded that it was not liable to indemnify MHP in respect to any liability of the plaintiff because the plaintiff was not a person entitled to compensation in Victoria under the relevant legislation.
In paragraph 28, it pleaded that the plaintiff was not entitled to compensation in Victoria by reason of s 37 of the legislation "because his employment is not connected with the State of Victoria". In paragraph 29, it pleaded as a positive assertion that the plaintiff was a person entitled to compensation in New South Wales, and that he had made a claim and received compensation in New South Wales. In addition to those pleadings, the second defendant pleaded in paragraph 30, this:
"Further, and in the alternative, if the plaintiff is a person entitled to compensation in Victoria, which is denied, he is not entitled to recover damages for the injury because the plaintiff has not complied with Division 2 Part 7 of the [relevant legislation]. The authority has not issued to the plaintiff a serious injury certificate, nor has he obtained leave of the court to proceed with the claim for damages."
Subsequently to that, the second defendant filed a Cross-claim on 18 August 2022 against the first defendant, Super Seasons, and the first defendant filed a Cross-claim against the second defendant.
On the morning that the proceedings were listed to commence, I was informed by counsel for the plaintiff that he had received submissions from the second defendant on that morning which had been filed about half an hour before the proceedings were due to commence.
In those submissions, the second defendant submitted that as a consequence of the failure by the plaintiff to comply with various procedural requirements of the Victorian legislation, the plaintiff was precluded from bringing the proceedings, and further that he had no entitlement to damages because the action against the second defendant was not validly commenced, and so did not enliven the second defendant's potential liability to pay damages to the plaintiff under the relevant Victorian statute. The second defendant in their submissions drew attention to the failure of the plaintiff to commence proceedings either in accordance with the relevant Victorian legislation or to obtain consent from the second defendant to commence proceedings. Because of those failures, the second defendant submitted the plaintiff's entitlement against the second defendant "remains extinguished".
By way of background to that submission, I am informed that as a result of the hearing before the Chief Judge at Common Law last week, the second defendant sought and was granted leave to amend its Defence by deleting paragraphs 27 to 29 inclusive. By that time, which was a week ago, it had apparently become clear to the second defendant, after almost two years of the case being on foot, that the plaintiff had no entitlement to receive workers' compensation from the New South Wales insurance fund iCare, and that he was entitled to receive compensation from the second defendant under the Victorian legislation because the plaintiff's employer MHP was insured by the second defendant.
Quite why it took from 23 March 2021, when an application was initially made to the Victorian WorkCover Authority under the relevant legislation claiming damages until October 2022 for it to decide, contrary to its Defence, that it was obliged to provide compensation to the plaintiff, is unexplained.
[3]
Application for Amendment of the Defence
As a consequence of the receipt of that submission, it became apparent that the second defendant wished to amend its Defence so as to plead matters which required specific pleading, namely that procedural preconditions fixed by legislation before a claim could be commenced had not been met, and further that the plaintiff, as a consequence of that failure, had no entitlement to proceed: see r 14.14(2)(a) and r 14.14(2)(b) of the Uniform Civil Procedure Rules 2005.
In the course of that application for leave to amend the Defence, it was clear that in order to understand and assess prejudice, for the purpose of the exercise of the Court's discretion, that as the plaintiff had not made an application for an extension of time to the second defendant, if such an application were made promptly and dealt with promptly, the Court would be in a better position to understand the respective prejudices which each of the second defendant and the plaintiff claimed needed to be balanced for the purpose of the application to amend the Defence.
The application for extension of time to commence proceedings was submitted to the second defendant last night. It was anticipated that it could be dealt with promptly and that the proceeding could recommence at 11am this morning. As it turned out, that was not possible, and a decision was not made with respect to the application until about lunchtime today. Shortly before 2pm today, when the Court resumed, the plaintiff (but not the Court) was provided with a copy of that decision.
I am informed that the decision of the Victorian WorkCover Authority was that it would not give leave to the plaintiff to bring these proceedings out of time. That decision, made in accordance with the Victorian legislation, is an administrative one, and I am informed by the plaintiff, without contest, that the only available challenge to that decision is one by way of judicial review to a Supreme Court.
[4]
Costs of Any Adjournment
Unsurprisingly, the plaintiff wishes to determine, by an application for judicial review, whether the decision of the Victorian WorkCover Authority should be set aside or not. Accordingly, this case has reached the position at the end, or at least, towards the end, of the second day of hearing where the plaintiff is not in a position to proceed. No one opposes the plaintiff's application for an adjournment.
However, both the first defendant and the plaintiff seek an order for costs for the days occupied yesterday and today, and those costs thrown away by the adjournment. They seek that costs be ordered on an indemnity basis against the second defendant.
The second defendant submits that it is premature for the Court to make an order for costs because the outcome of the judicial review is not known.
[5]
Discernment
I am satisfied that the cause of this case not going ahead and being adjourned is twofold. First, the acceptance last week by the second defendant that it was the relevant workers' compensation insurer for MHP, the company which employed the plaintiff, and the withdrawal of the defence which had been maintained until last week contained in paragraphs 27 to 29 of the second defendant's Defence. The second is the application by the second defendant, first announced on the morning the case was due to commence, to amend its Defence to plead matters which the rules require to have been pleaded from the very start. As a result of that application and the consequential steps taken by the plaintiff, which were reasonable, two days have been completely wasted, the balance of the days set aside have been lost, and the costs of preparation for this hearing at this time have been wasted.
The affidavit sworn by the solicitor for the second defendant does not explain at all why it is that the second defendant changed its approach to this case, nor why it is that after almost two years it withdrew the complete denial that the plaintiff was a person entitled to compensation under the Victorian legislation, and declined to proceed with the positive assertion pleaded in the Defence that iCare NSW was the body responsible for paying the plaintiff any entitlements under the relevant Workers Compensation legislation.
The highest that the explanation rises from the solicitor is that until shortly before the proposed amended Defence was served on the plaintiff, he thought it was unnecessary to plead to a proceeding that had not been validly brought against the second defendant. He accepts that there was no pleading on foot that triggered consideration of the grounds to be relied upon now by the second defendant if their application to amend the Defence is successful.
In my view, the failure of the second defendant to properly plead the Defence, to plead material which was incorrect in the Defence, and to fail to seek to amend the Defence so as to plead the necessary matters under the UCPR is directly the cause of the adjournment which is required, and which I have granted.
There is no adequate explanation for why that happened so late and, in my view, the proper and appropriate order is that the second defendant is to pay the first defendant's costs of, and occasioned by, the adjournment of the proceedings fixed for hearing to commence on Monday, 10 October 2022. I also order that the second defendant is to pay the plaintiff's costs of, and occasioned by, the adjournment of the proceedings fixed for hearing to commence on 10 October 2022.
The first defendant and the plaintiff seek an order that the costs be paid on an indemnity basis. The first defendant seeks further, that the Court enter a gross sum costs order and order that the costs be payable forthwith. I am satisfied, having regard to the matters that I have already previously mentioned that the order for costs should be costs on an indemnity basis. However, I do not have sufficient material to enable me to assess any sum for costs as a gross sum costs order. In those circumstances, I will make the following orders.
[6]
Other Procedural Matters
Before I do that, I need also to add that, in light of the fact that this matter has been adjourned and important matters of fact are yet to occur, it is inappropriate for this Court to rule on the application by the second defendant to amend its Defence at this stage. Given that I have heard some argument, it may be thought efficient if I was to say that that application was part-heard and should come back before me but, on reflection, I think that would be inappropriate. Depending on what occurs there may or may not need to be an application to amend the Defence. If there is to be such an application, that motion, because the terms of any future amended Defence may itself change, can be dealt with in due course in the ordinary way. I do not regard myself as part heard.
I should also add before making formal orders that the first defendant sought leave to amend its Defence, and that there was no substantive opposition to that. That leave is to plead a minor amendment and I would be persuaded to grant leave to the first defendant to amend its Defence by adding back in a paragraph which had previously been there. I would direct that any amended Defence pursuant to that leave be filed within seven days.
[7]
Orders
I make the following orders:
1. Proceedings are adjourned.
2. The 10-day hearing fixed to commence on 10 October 2022 is vacated.
3. Order the second defendant to pay the costs of and occasioned by the adjournment of both the plaintiff and the first defendant on an indemnity basis.
4. Grant either the plaintiff or the first defendant liberty to apply to Garling J for any additional costs order as they may be so advised. Any such application will need to be by Notice of Motion served in accordance with the Rules, supported by any affidavit material which they would rely upon.
5. Grant leave to the first defendant to file an Amended Defence.
6. Order that any Amended Defence be filed and served on or before 19 October 2022.
7. Stand the proceedings over for directions before the Common Law Registrar on 20 February 2023.
8. Grant the parties liberty to apply in the event that that time can be shortened, or the matter can be relisted prior to that date occurring.
[8]
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Decision last updated: 26 April 2023