Citation : ABREU -v- THOMAS PEACOCK & SONS PTY LTD [No 3] [2012] WADC 31

Limitation of actions - Personal injury at work - Relevant limitation period - Whether Limitation Act 2005 (WA) s 14 applies - Appeal against decision of primary judge that s 93K(4) of Workers' Compensation and Injury Management Act 1981 (WA) excludes operation of s 14 of Limitation Act - Cross­appeal against finding that if s 14 of Limitation Act applies cause of action accrues only when plaintiff obtains assessment of greater than 15% disability

Limitation Act 2005 (WA), s 6, s 9, s 14, s 55

Workers' Compensation and Injury Management Act 1981 (WA), s 93C, s 93K, s 93L, s 93M, s 93O

Abreu v Thomas Peacock & Sons Pty Ltd [No 3] [2012] WADC 31

Yew Bon Tew v Kenderaan Bas Mara [1983] 1 AC 553

1 JUDGMENT OF THE COURT: This is an appeal against a decision of Keen DCJ in the District Court in which, on the trial of a preliminary issue, his Honour found that s 14(1) of the Limitation Act 2005 (WA) (the Limitation Act) did not apply to a claim for damages for personal injury suffered by the respondent in the course of his employment: Abreu v Thomas Peacock & Sons Pty Ltd [No 3] [2012] WADC 31.

2 As the decision was of an interlocutory nature, the appellant requires leave to appeal. On 26 March 2012, the application for leave to appeal was referred to the hearing of the appeal.

3 The respondent says that he was injured at work on 29 May 2006 when he was required to assist a mechanic to re-attach a metal shaft weighing approximately 100 kg to a piece of equipment. In the course of doing so he injured his back, suffering what was subsequently diagnosed as a disc protrusion at L5/S1. The respondent says that he returned to work on 30 May 2006 but developed pain in his groin and abdomen which radiated to his back. He was sent home by the supervisor. The respondent worked intermittently thereafter until on or about 23 August 2007, when his doctor issued a first medical certificate under the Workers' Compensation and Injury Management Act 1981 (WA) (Workers' Compensation Act), certifying him totally unfit for work for three days by reason of back pain caused by the accident.

4 We did not understand it to be in issue that the respondent did not lodge a claim for workers' compensation until 6 September 2007. On the hearing of the appeal, senior counsel for the respondent said the delay occurred because the respondent had been unaware of his right to workers' compensation.

5 On 3 June 2008, the respondent underwent a CT-guided epidural injection at L5/S1 and, on 9 September 2008, he underwent a spinal fusion at L5/S1.

6 Under the Workers' Compensation Act, if the respondent wished to retain his right to claim common law damages from his employer he was required to lodge an election to do so within one year of the injury, unless the Director Dispute Resolution (the Director) appointed under the Workers' Compensation Act extended the time for doing so. At about the time of the spinal fusion, the respondent was advised by the Director that the termination date for his election to retain the right to damages under s 93K of the Workers' Compensation Act had been extended to 2 September 2009.

7 The respondent subsequently lodged his election to retain the right to damages and, on 18 August 2009, he was advised that it had been registered. A writ claiming damages for personal injury from the appellant was issued on behalf of the respondent the following day, 19 August 2009.

8 The appellant filed a defence to the claim pleading, among other things, that the action was barred by s 14 of the Limitation Act, the action having been commenced more than three years after the cause of action arose.

9 The respondent denied that s 14 of the Limitation Act barred the action, contending that, by virtue of s 93K(4) of the Workers' Compensation Act, the respondent's cause of action did not accrue until the respondent was assessed as having a degree of permanent disability of at least 15% and an election to retain the right to damages had been registered under the Workers' Compensation Act.

10 The parties agreed that certain issues should be determined as preliminary issues. For that purpose, a statement of issues was filed. It is necessary to refer to only two. They are as follows:

(a) Does s 14(1) of the Limitation Act apply to this type of action in view of s 93K(4) of the [Workers' Compensation Act]?

(b) If s 14(1) does apply:

(i) When did the [respondent's] cause of action accrue?

(a) No;

(b)(i) 29 or 30 May 2006.

12 His Honour ordered that pars 4(c), 4(d) and 6 of the appellant's defence, which pleaded the limitation defence, be struck out. It is not apparent from the appeal papers how that order came to be made and, in particular, whether the application before his Honour sought such relief in the event that issue (a) was answered in the negative or whether it came about in some other way.

13 Before turning to the reasons of the primary judge, it is convenient to set out the relevant statutory provisions.

14 The relevant provisions of the Limitation Act are s 6, s 9, s 14 and s 55. They are as follows:

1. Personal injury Actions - accrual, limitation periods

(1) Section 55 or 56, as is relevant to the case, applies to ascertain when a cause of action relating to a personal injury to a person accrues.

...

1. Limitation periods under other written laws

(1) This Act ... does not affect the operation of a limitation provision in another written law, or anything done under such a provision.

(2) In subsection (1) -

(a) a provision that establishes, modifies, or extinguishes a cause of action or a defence to a cause of action;

(b) a provision prescribing the time within which an action can be commenced (including a law providing for the extension or shortening of that time);

(c) a provision in respect of the limitation or exclusion of liability or the barring of a right of action if an action is not commenced within a particular time limit.

1. Personal injury, Fatal Accidents Act 1959 actions - 3 years

(1) An action for damages relating to a personal injury to a person cannot be commenced if 3 years have elapsed since the cause of action accrued.

(1) A cause of action for damages relating to a personal injury to a person accrues when the only or earlier of such of the following events as are applicable occurs -

(a) the person becomes aware that he or she has sustained a not insignificant personal injury;

(b) the first symptom, clinical sign or other manifestation of personal injury consistent with the person having sustained a not insignificant personal injury.

(2) This section does not apply to a personal injury that is attributable to the inhalation of asbestos.

15 The relevant provisions of the Workers' Compensation Act are contained in div 2 of pt IV of the Act. Division 2 applies to the awarding of damages against a worker's employer in respect of an injury suffered by the worker: s 93B. Section 93K was introduced as part of wide-ranging amendments to the Workers' Compensation Act made by the Workers' Compensation Reform Act 2004 (WA). They included a number of amendments to the provisions of the Act relating to restrictions on the awarding of damages for personal injury. It is unnecessary to canvass the details of those amendments. For present purposes, the significant alteration was the imposition, by s 93K(4), of a 30-day period after the Director gives the worker written notice that the Director has registered the worker's election to retain the right to damages within which the worker was required to commence any proceedings for damages. Previously, no time period was specified.

16 The relevant provisions in the amended Act are as follows:

93C Limit on power of courts to award damages

If this Division applies a court is not to award damages to a person contrary to this Division.

(4) Damages in respect of an injury can only be awarded if -

(a) the worker elects, in the manner prescribed in the regulations, to retain the right to seek the damages; and

(b) the Director registers the election in accordance with the regulations; and

(c) court proceedings seeking the damages are commenced within -

(i) the period of 30 days after the Director gives the worker written notice that the Director has registered the election; or

(ii) any further time provided for in the regulations to allow for things to be done before court proceedings are commenced;

(d) the court is satisfied that the worker's degree of permanent whole of person impairment is at least 15%.

93L Election under s 93K to retain right to seek damages

termination day has the meaning given in section 93M.

(2) A worker can only elect under section 93K(4) to retain the right to seek damages if -

(i) that the worker's degree of permanent whole of person impairment is at least 15%; and

(ii) as to whether or not the worker's degree of permanent whole of person impairment is at least 25%;

(b) the worker's degree of permanent whole of person impairment has been assessed to be a percentage that is not less than 15%,

and the Director has, at the written request of the worker, recorded that agreement or assessment in accordance with the regulations.

(3) ...

(4) If a claim for compensation by way of weekly payments has been made wholly or partially with respect to the injury or injuries concerned, an election cannot be made after the termination day.

...

(1) If a claim for compensation by way of weekly payments has been made wholly or partially with respect to an injury, the termination day for an election to retain the right to seek damages in respect of that injury is the last day of the period of one year after the day on which the claim for compensation by way of weekly payments is made unless a later day is fixed by subsection (3) or under subsection (4).

...

93O Employer to give worker notice of certain things

(1) At the time described in subsection (2), the employer is required to notify the worker in writing in accordance with the regulations -

(a) of the day that would be the termination day if no later day were to be fixed under section 93M(4);

(b) that about 6 months remains before the termination day;

(c) of the significance of the termination day for the worker's ability to seek damages; and

(d) ...

(2) The notice is required to be given within the period of 14 days commencing on the day that is 6 months and 14 days before the day that would be the termination day if no later day were to be fixed under section 93M(4).

17 The primary judge found that s 14 of the Limitation Act did not apply to the respondent's claim for common law damages. His Honour noted that the effect of s 93K(4) of the Workers' Compensation Act was that common law damages were not recoverable unless the worker commenced proceedings within 30 days after notice of the registration by the Director of an election duly made by the worker to retain the right to seek damages. His Honour concluded that s 93K(4) was a limitation provision within the meaning of s 9(2) of the Limitation Act, as it modified, extinguished or barred a cause of action for common law damages [42], [51] - [52].

18 His Honour found that it followed, by reason of s 9(1) of the Limitation Act, that the three year limitation period in s 14 of that Act did not apply to a claim by an injured worker for common law damages [54]. He concluded that the scheme of the Workers' Compensation Act was to limit a worker's access to common law damages by reference to the termination date; that is, the relevant limitation period was contained in s 93K(4)(c), being a period of 30 days (or any extended time) after the Director gave notice of registration of the worker's election [54].

19 The primary judge rejected a submission by the appellant that the Workers' Compensation Act simply imposed additional constraints on the ability of an injured worker to recover common law damages [55]. That, his Honour considered, would mean that in some circumstances a worker would be deprived of access to common law damages within a shorter period than allowed under s 14 of the Limitation Act, and in other circumstances it would deprive a worker of access because through no fault of his or her own the worker was unable to meet the requirements in s 93K(4) within the period allowed under s 14 of the Limitation Act [53]. The primary judge referred to statements in the second reading speech by the Minister on the Workers' Compensation Reform Bill that the bill was intended to help to restore 'fairness, balance and certainty' to the system of workers' compensation [46]. His Honour concluded that the construction contended for by the appellant would defeat the purpose or object of fairness underlying the Workers' Compensation Act and would lead to a result that was both unreasonable and unfair [55].

20 While that rendered the second issue otiose, the primary judge nevertheless went on to consider it. On that issue, the respondent contended that if s 14 of the Limitation Act applied, the respondent's cause of action accrued, not at the time the accident occurred, but when the respondent first obtained an assessment that he had a greater than 15% whole of body impairment; that is, when he first knew that he had an injury which would entitle him under the Workers' Compensation Act to bring a claim for damages.

21 His Honour rejected that contention, finding that, if s 14 of the Limitation Act applied, the cause of action accrued on 29 or 30 May 2006 [118].

22 The appellant appeals against the decision of the primary judge that s 14 of the Limitation Act does not apply to the respondent's claim. In the event the appeal is upheld, the respondent cross-appeals against his Honour's finding that the cause of action accrued on 29 or 30 May 2006.

23 The sole ground of appeal is that the primary judge erred in law in holding that s 14(1) of the Limitation Act does not apply to an action for damages by an employee against an employer.

24 The evident purpose of div 2 of pt IV of the Workers' Compensation Act is to impose constraints on the award of damages in actions for common law damages against employers by employees who are injured in the course of their employment. The relevant provisions have been set out earlier. The scheme can, for present purposes, be shortly described.

25 Under s 93K(4), an injured worker can only be awarded common law damages against an employer if the worker elects to retain the right to do so. The right to elect only arises if the worker and the employer agree that the degree of the worker's permanent whole of body impairment is at least 15% or the impairment has been so assessed by an approved medical specialist, and the Director has, at the worker's written request, recorded that agreement or assessment: s 93L(2). (The degree of permanent whole of body impairment is evaluated pursuant to s 146A and s 146C: s 93H.)

26 If a claim for weekly compensation has been made with respect to the injury, the election to retain the right to seek damages cannot be made after the 'termination date': s 93L(4). The 'termination date' is one year after the date on which the claim for weekly compensation was made (s 93M(1)), unless the Director extends the time under s 93M(4). One of the circumstances in which the Director may extend the time is where an approved medical specialist has certified that the worker's condition has not sufficiently stabilised to allow an assessment to be made as to whether the worker's impairment is at least 15%: s 93M(4)(a). (An 'approved medical specialist' is a medical practitioner who has been designated as such by WorkCoverWA by order published in the Government Gazette: s 146F(1).)

27 Once the Director gives the worker notice that the worker's election to retain the right to seek damages has been registered, the worker must commence proceedings for damages within 30 days: s 93K(4).

28 The effect, therefore, of s 93K(4) is that no award of damages can be made unless by the termination date the worker has elected to retain the right to seek damages and, within the 30-day period after notice of registration of that election, has commenced an action for damages. Section 93K(4) does not extinguish the cause of action, it prescribes a time within which an action for damages must be commenced if the court is to have the power to award damages. Whether this makes s 93K(4) a limitation provision within the meaning of s 9(2) of the Limitation Act was not the subject of any submissions. However, even if it is such a limitation provision, it makes no difference to what follows.

29 The critical question is whether, by virtue of s 9(1) of the Limitation Act, the relevant limitation period for a claim for damages made pursuant to s 93K is contained in s 93K(4), and s 14(1) of the Limitation Act has no operation. In our view, that is not the case. Section 14(1) of the Limitation Act does not 'affect' the operation of s 93K(4) of the Workers' Compensation Act; the two provisions are directed to different ends and operate quite independently. Both provisions apply to a claim for damages made pursuant to s 93K.

30 The evident purpose of div 2 of pt IV of the Workers' Compensation Act is to deter small, disproportionately costly, claims for damages being brought in respect of workplace accidents. To that end, it provides that a worker cannot recover an award of damages unless their injury meets the statutory threshold, in this instance 15% of whole of body impairment. The procedure set out in div 2 is directed to ensuring that an injury meets the statutory threshold before proceedings are commenced. The election by a worker to 'retain' his or her right to damages can only be made once it has been determined that the injury meets the threshold. Once that has been determined and the election registered, it is then incumbent upon the worker to commence any legal proceedings promptly (that is, they must be commenced within the 30-day period after notice that the election has been registered), failing which the court will have no authority to award damages.

31 The time limits under the Workers' Compensation Act by which the relevant steps are to be taken envisage that the process will not be unduly prolonged. Section 178 of the Workers' Compensation Act contemplates that ordinarily proceedings for recovery of compensation under the Act must be made within 12 months of the injury. Subject to certain limited circumstances in which the time may be extended (s 93M(4)), the termination date by which an election to retain the right to damages must be made will ordinarily be one year from the first date upon which a claim for weekly payments of compensation is made.

32 Section 14 of the Limitation Act is directed to a different end. It gives effect to a parliamentary intention that if an action for damages for personal injury is to be brought, it must be brought within a period of three years from the time at which the plaintiff first becomes aware that they have suffered a 'not insignificant' injury. The provision in s 55 as to the time at which the cause of action accrues is plainly intended to avoid the prospect of the limitation period expiring before a person is aware they have an injury of a nature which would justify a claim for damages.

33 The limitation period of three years after the cause of action accrues reflects a balance which has been struck by the legislature between the interests of the respective parties. It recognises that a plaintiff must have a reasonable opportunity to bring a claim but, on the other hand, a defendant should not have a claim hanging over its head indefinitely or be subjected to delay of a magnitude which puts at risk a fair trial of the claim. The purpose of a limitation period is to ensure a final point at which a potential defendant can assume that it is no longer at risk from a claim; when it can part with any relevant papers and order its affairs on the basis that the potential liability has gone: Yew Bon Tew v Kenderaan Bas Mara [1983] 1 AC 553, 563.

34 There may, of course, be hard cases where the limitation period expires before the requirements of s 93K(4) of the Workers' Compensation Act are complied with, although having regard to the regime set out in that Act they should be rare indeed. But there will always be hard cases, on one side or the other, however the balance is struck. In the present circumstances, we consider it is evident from the legislation that the balance has been struck by Parliament in the manner we have described.

35 In our opinion, the primary judge erred in finding that s 14 of the Limitation Act did not apply. His Honour should have held that it did and that accordingly the respondent's claim was out of time.

36 In the event that it was held that s 14 of the Limitation Act did apply to the respondent's claim, the respondent sought to uphold the decision of the primary judge to strike out the appellant's limitation defence on grounds not relied upon by his Honour, alternatively to cross-appeal against his Honour's finding as to the date upon which the respondent's cause of action for damages at common law accrued.

37 It seems that what the respondent seeks to advance is a cross-appeal, challenging as he does an express finding made by his Honour on stated issue (b)(i). By the cross-appeal, the respondent contends, in effect, that the primary judge erred in law in finding that the respondent's cause of action for damages accrued on 29 or 30 May 2006, and that he should have found it accrued on 18 August 2009.

38 The respondent contended that where s 93K of the Workers' Compensation Act applies to an action for damages for personal injury, the cause of action for damages does not accrue for the purposes of s 14(1) of the Limitation Act until the worker obtains an assessment that he or she has a permanent impairment greater than 15%. That, it was argued, is because until that time the worker is not aware that 'he or she has sustained a not insignificant personal injury', within the meaning of s 55(1)(a) of the Limitation Act. Similar considerations were said to arise in relation to s 55(1)(b).

39 Counsel for the respondent submitted that it was evident that s 55 was intended to overcome the rule that in tort a cause of action accrues, and time runs, from when the damage is suffered even if the damage was not discoverable at that time. It could not therefore have been intended that a cause of action would accrue under s 55 while an injured worker was unaware whether the extent of their injury would be sufficient to enable an action for damages to be brought. Such a worker may be able to establish negligence but, as was previously the case with a person who had an undiscovered injury, he or she has no legal remedy.

40 We do not accept the respondent's contention. It is plainly the case that the purpose of s 55 is to avoid time running while a person is unaware that he or she has suffered a 'not insignificant' personal injury; that is, an injury which is not 'trifling' or 'of no consequence': Macquarie Dictionary. Whether or not an injury is of such nature must depend upon the extent of the injury itself. The effect of s 55 is that the cause of action accrues when the person first becomes aware that they have suffered such a personal injury or there is some symptom, clinical sign or other manifestation consistent with such a personal injury. The relevant criterion is awareness, or means of awareness, of the existence of a personal injury which is not insignificant.

41 The effect of the respondent's contention would be to add a further criterion, namely, the operation of any statutory requirements which must be satisfied before a claim for damages for personal injury can be brought, where the cause of action would accrue, not at the time at which the person first became aware that they had suffered a not insignificant injury, but at the time at which the person satisfied those statutory requirements. That construction cannot be accepted. It is inconsistent with the plain words of s 55 and there is nothing in the Limitation Act which would warrant s 55 being construed in that way. If Parliament had intended it to bear such a meaning it would have been easy so to provide.

42 In our view, it is not therefore to the point that under the Workers' Compensation Act damages for a personal injury suffered at work can only be awarded where, among other things, a person has suffered permanent whole of body impairment of at least 15%. Under s 55, the cause of action accrues when a person first becomes aware they have suffered a personal injury which is 'not insignificant' or there is the first manifestation consistent with such an injury, not when they have satisfied any statutory restrictions on the power of the court to award damages for the injury.

43 The notice of contention and the cross-appeal should be dismissed.

(3) set aside the answer of the primary judge to issue (a) of the statement of issues;

(5) dismiss the notice of contention and the cross-appeal.

45 The appellant also seeks to have the order of the primary judge striking out pars 4(c), 4(d) and 6 of the appellant's defence set aside and an order of this court dismissing the respondent's action in the District Court with costs. There is, however, no material in the appeal books relating to those matters and no oral submissions were made in respect of them. Presumably the appellant contends that such orders follow as a matter of course if the appeal is allowed, but we would not be prepared to make such orders without hearing the parties.