UNE v Larsen-Walsh

THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL

UNIVERSITY OF NEW ENGLAND v UTA FRIDA LARSEN-WALSH WORKERS COMPENSATION - claim for compensation and damages - whether injury deemed to have occurred after 30 June 1987 - s 16 of Worker's Compensation Act 1987 applies to claims for compensation, not damages - award for past voluntary service not excessive or contrary to s 151K(3) of Worker's Compensation Act 1987.

DAMAGES - whether damages assessed under correct legal regime - s 16 of Workers Compensation Act 1987 does not affect common law rights - no appealable error in assessment of general damages or non-economic loss

The respondent was injured as a result of exposure to chemical and other fumes at the appellant's art department where she worked as a lecturer from 1972 to 1989. She sued for damages and in March 2000 Robison DCJ entered judgment in her favour The respondent's exposure to fumes occurred before and after 4pm 30 June 1987 when the Worker's Compensation Act 1987 came into force. The University argued that the Judge erred in not assessing all the damages under the Act because s 16 deemed her injury to have occurred after the Act commenced. The appellant also challenged the Judge's assessment of general damages, non-economic loss and the award for past voluntary services.

Held, (dismissing the appeal): In relation to the correct legal regime: (1) The regime of modified common law damages introduced by the 1989 amendments had no application to a claim for damages arising out of events which occurred prior to 4pm 30 June 1987. The deeming provision in section 16 only applies to the determination of compensation claims.

Hobbs v Costain Australia Ltd (1995) 11 NSWCCR 56 applied.

General damages and non-economic loss: (2) No legal conclusion could be drawn by simply adding the respective sums awarded for general damages and non-economic loss together because they were not directly comparable.

(3) The Judge's assessments were supported by the evidence and it had not been established that the awards were outside the range of a sound discretion.

(4) No appealable overlap between the two awards could be demonstrated.

Past voluntary services: (5) The Judge's award of 4 hours per day was not excessive or contrary to s 151K(3) given that he made allowance for the services which the respondent's husband provided for himself or for himself and his wife jointly. ORDER Appeal dismissed with costs. ********

1 SPIGELMAN CJ: I invite Justice Handley to deliver the first judgment. 2 HANDLEY JA: This is an appeal by the New England University from the judgment of Robison DCJ in an industrial accident case. The plaintiff worked in the University's Art Department from 1972 to early 1989. After August 1977 she worked in premises which were not properly ventilated, where she was exposed to chemical fumes from paints and other materials used by herself and her students in their work. 3 From August 1979 onwards she suffered increasingly from various symptoms which affected her in her work, her career and her private life. The trial Judge accepted, and it was not in dispute on the appeal, that these symptoms were caused by her sensitivity to the chemical fumes she experienced at work. 4 She ceased work in January 1989 because she could no longer cope and was later retired on medical grounds. 5 She brought proceedings in the Supreme Court against the University in 1989 claiming damages for her personal injuries sustained as a result of exposure to chemical fumes in her work. The case was remitted to the District Court and came on for trial before Robison DCJ who entered judgment in her favour for $761,838.07 after reduction of the amounts paid under the Workers Compensation Act. 6 During the trial the University admitted liability and the action proceeded as an assessment. Liability was not an issue on the appeal. 7 The plaintiff's exposure to the fumes at work occurred both before and after 4pm on 30 June 1987 when the Workers Compensation Act 1987 came into force. Her rights to common law damages up to that time were not, as a general rule, affected by the new Act. However amendments which took effect in 1989 left her with common law rights based on her exposure to chemical fumes after 30 June 1987, which were significantly affected by the provisions of the 1987 Act as amended. 8 The issues argued in the appeal have turned on the need to award damages for the plaintiff's injuries under these two different legal regimes. The components of the award which are challenged on the appeal are the award of $126,000 for non-economic loss under the Act, representing 70 per cent of the most extreme case, $40,000 for general damages at common law and the award of $142,680 for past voluntary services made under the Act which was based on four hours a day of such services. Mr Hislop's first point was that the whole of the damages should have been assessed under the Act as amended. 9 The respondent brought proceedings for compensation under the Act which were determined by Nielson CCJ on 20 May 1997. The Compensation Court Judge found in favour of the respondent under s 16 on the ground that her injury consisted of the aggravation, acceleration, exacerbation or deterioration of a disease. A better view may have been that the respondent suffered from a disease which was contracted by a gradual process so that her case arose under s15 of the Act, but nothing turns in this appeal on the distinctions between the two sections. 10 Mr Hislop submitted that s 16 affected the respondent's action for damages because it deemed her injury to have been sustained when she suffered incapacity for work in January 1989 so that the whole of her damages fell to be assessed in accordance with the Act. In support of this submission he referred to ss151B, 151E and 151U which applied to awards of damages in respect of "an injury" or to "an injury to a worker". 11 He then referred to the decision of this Court in Hobbs v Costain Australia Limited (1995) 11 NSWCCR 56 and attempted to distinguish that case as turning on the special provisions of s17 dealing with loss of hearing. In my judgment the case cannot be distinguished on the basis Mr Hislop suggested. The ratio of the decision is to be found at pp 64 and 65 where Cole JA, who delivered the principal judgment, said:

"It also follows that the regime of modified common law damages contained in Div 3 Pt 3 of the Act as introduced by the 1989 amending Act has no application to a claim for damages arising out of events which occurred prior to 4pm on 30 June 1987". 12 Earlier Cole JA had approved the submission by Mr McAlary that the deeming provision in s17 "for the purposes of this Act" made that section relevant only for the purposes of determining liability for compensation. That section, for the purposes of s151, did not deal, expressly or by implication, with common law rights. In my judgment this reasoning is directly applicable to s16. That section contains numerous references to compensation, claims for compensation and to the Compensation Court which strengthens the conclusion drawn by this Court in Hobbs v Costain (Australia) Limited (above). See s16(1)(a)(ii), (Claim for compensation), s16(1)(b) (Compensation payable), s16(2) (Claim, compensation, Compensation Court and contribution), s16(2A) (Compensation Court, contribution and compensation), and s16(3) (Compensation). The appellant's first submission based on the 1987 Act as amended fails. 13 The appellant's next challenge went to the awards for general damages and non-economic loss. Mr Hislop first submitted that error in these awards could be demonstrated by simply adding them together and calculating the percentage which the sum represented of the maximum awardable for non-economic loss in the most extreme case, which he said was over 90 per cent. The amounts are indeed substantial, but they are not directly comparable because one is capped by statute and the other is not. In my judgment no legal conclusion can be drawn from the result of adding two sums together. The $40,000 awarded as general damages compensates the respondent for her pain, suffering and loss of enjoyment of life during the period from 1980 to 1987 and for the continuing consequences thereafter of the injuries she sustained during this period. The appellant has not established that this was a wholly inappropriate assessment of this aspect of the plaintiff's loss. 14 The plaintiff's non-economic losses after 1987 as a result of injuries sustained after that date was based on the evidence of the plaintiff, her husband, and her medical evidence. The defendant did not call any medical or other evidence. The Judge who, in any event, may have been bound by the judgment of Nielson CCJ on this issue, was not satisfied that all of the plaintiff's medical problems were due to her exposure to chemical fumes. He was not satisfied that her claim extended to her gynaecological condition, acne vulgaris, warts, chondromalacia patellae and her other skin problems. However, in general he accepted the plaintiff and her husband as credible witnesses and accepted her medical evidence. 15 The Judge found that her return to work in January 1989, after a period of some six months' study leave, and her renewed exposure to chemical fumes at that time, was the straw that broke the camel's back and she was unable to continue with her work. He said:

"It all came to a head in January 1989 and the plaintiff basically found she was unable to continue. That really crystallised the injury and damages to a large extent and in particular the disabilities which flowed".

16 He accepted evidence from the plaintiff who described her condition by saying: "I have lost my health, my job, my income, my standard of living, my confidence, my intellectual ability and pursuits, my ability to practice artwork as well as other pleasures such as going to concerts, skiing, sports, et cetera. In many ways my raison d'etre has been taken away from me because of [my] working conditions". 17 He found that recently there had been some improvement in the plaintiff's condition, no doubt, as he said, due to her isolation from her previous workplace and that that was something to be taken into account. He also found that at the date of trial her medical condition had stabilised but her improved health was, as he said, "obtained at a considerable sacrifice on the part of herself and her husband" and was dependent on her continuing lack of contact with substances which could aggravate her condition. There was no cure for her condition and the only feasible strategy was to segregate herself from the world on their country property. 18 The plaintiff is sensitive to a whole range of smells, apart from those which she experienced at work, such as cigarette smoke, the smell of newly laid carpet, the smells from perfumes and other cosmetics used by women, the smell of aftershave and the smells from cleaning products. 19 In her affidavit of 11 February 2000 in the blue appeal book she refers to some of her symptoms and some of the consequences of her condition from p 50 onwards. These include headaches, breathing pains, stomach pains, inability to eat or sleep, and loss of weight. She has been known to collapse when travelling, become disoriented, develop severe headaches and cramps, and to be unstable on her feet so that she is likely to fall. She has found difficulty with her breathing, has experienced chest pains for extended periods, and has been bedridden. In April 1999 her daughter was married in Victoria but she felt that she could not risk the complications which would be the result of travelling to Victoria and attending the wedding. 20 In October 1999 she had five weeks of total disability with periods of extremely low blood pressure, inability to stand and significant pain. Unsurprisingly, she has experienced depression. 21 The respondent was born in 1942 and is now 58. She has a substantial life expectancy. The award for non-economic loss affected by the Act covers the periods since 1987 insofar as her symptoms have been caused by post 1987 exposure to industrial fumes. In particular it covered the 11 year period between the loss of her employment in 1989 and the trial, that is the period between ages 47 and 58. 22 The plaintiff would normally have worked until age 65. Before her health was affected by her exposure to fumes she had apparently good prospects of achieving a higher degree with chances of promotion. She has lost the non-economic benefits of participating in the active social and cultural life of the University, apart from the economic benefits of employment in such an institution. She now finds herself virtually a prisoner on her own property and her former way of life has been destroyed. 23 The plaintiff, of course, did have better periods, particularly between 1990 and 1992 in New Zealand, but the Judge referred to these matters and they were not overlooked. 24 The two awards are high, but the plaintiff's losses were severe and there is no cure for her condition. She will be locked into her withdrawal strategy for the rest of her life. 25 In the end I have not been persuaded that the award for non-economic loss under the Act is outside the range of a sound exercise of a discretionary judgment and I have not been persuaded that there was any appealable overlap between the two awards. 26 The remaining grounds of appeal concern the Judge's award for voluntary services. The Judge held that the real need for the plaintiff's care arose after the Act had commenced and that view could not be challenged, bearing in mind that she remained in employment or on leave from employment until January 1989. This component of her damages was sustained in 1989 and following and the Judge considered it appropriate to allow four hours a day for 364 weeks. Some of this time would not have attracted any award under this head. For example, the plaintiff remained in employment until January 1989, or was on leave, and there was a period in New Zealand when the plaintiff and her husband ran a bed and breakfast establishment and she had part-time work as a teacher. On the other hand there were periods when the plaintiff was bedridden when a higher award would be justified. Evidently his Honour arrived at an average figure which reflects the plaintiff's favourable and unfavourable experience during this period. The principal challenge by Mr Hislop to this component was based on the provisions of s 151K(3) of the Act which provides, in relation to voluntary services of a domestic nature or services relating to nursing and attendance, that "no compensation is to be awarded if the services would have been provided to the injured worker even if the worker had not been injured". 27 Mr Hislop referred to evidence that the plaintiff and her husband had agreed in July or August 1987 that he would remain at home and look after the farm and the home and that she would go to work at the University. The husband had previously worked as a pilot but had been severely injured and the agreement reflected a recognition, on the part of both, that her economic capacity was greater than his at that stage. To the extent to which the husband was providing these services in 1987 and following, for the benefit of himself and his wife, those services were provided before the injury sustained in January 1989 had occurred. 28 Mr Hislop therefore established the first step in his argument. However, the Judge did not allow the claim for voluntary services in full. The plaintiff's husband said that he was working 40 hours a week on domestic activities for the benefit of his wife and himself and for her benefit alone and the Judge allowed only four hours a day during this period. Some of that time was devoted exclusively to the wife and I refer to the massage services he provided. Other services were also provided for her benefit solely or substantially. When proper allowance is made for the services provided by the husband for his wife and the household, the submission that the award of four hours a day was excessive and contrary to s 151K(3) must fail. The award allows appropriately and inevitably in a broad way for the services which the husband provided for himself or for himself and his wife jointly, which he would otherwise have provided in any event, even if his wife had remained at work. 29 The Judge, noting the recent improvement in the plaintiff's health as a result of her isolation policy, allowed only two hours a day for the future. I do not understand that this component of the award was challenged. It follows, in my view, that all challenges to the judgment of Robison DCJ have failed and I would propose that the appeal be dismissed with costs. 30 SPIGELMAN CJ: I agree. 31 SULLY AJA: I also agree. 32 SPIGELMAN CJ: The order of the Court is that the appeal is dismissed with costs. *****************************

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