Vaghar v Meduri Enterprises P/L

THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION

11303/2000 - AZADEH VAGHAR v MEDURI ENTERPRISES PTY LIMITED t/as McDONALDS FAMILY RESTAURANTS

JUDGMENT (Extension of time - s 151D Workers Compensation Act)

1 MASTER: By summons filed 26 May 2000 the plaintiff seeks an extension within which to commence proceedings pursuant to s 151D(2) of the Workers Compensation Act (the Act). The plaintiff relied on his affidavit sworn 30 May 2000 and affidavits of Stephen P Firth sworn 24 May 2000 and Henrick Isaac sworn 2 June 2000. The defendant relied on the affidavit of Brian John Davidson sworn 12 July 2000. 2 The plaintiff and her current solicitor Mr Firth gave evidence and were cross examined. I carefully observed the plaintiff when she was giving evidence and being cross examined and formed the view that she was a truthful witness. For the purposes of this application, I find the following facts.

(1) The plaintiff was born on 25 June 1979 and is now aged 21 years.

(2) On 18 April 1994 the plaintiff commenced employment with the defendant and at that time she was 14 years and 9 months of age and was in Year 9 at Peter Board High School.

(3) On 4 July 1994 at 15 years of age the plaintiff sustained an injury to her lower back when she was lifting and carrying plastic crates loaded with hamburger buns. At the time she was lifting and carrying four crates stacked with buns. She told her supervisor that it was too heavy to lift. She was told to lift them because they were in a hurry

(4) Following the incident she immediately noticed pain in the centre of her lower back. She reported the incident to the managers and rang her father. The plaintiff's father took her to the nearest medical centre where she saw a doctor who gave her a medical certificate for time off work. The plaintiff returned to work after having one week off but noticed that she had virtually continuous pain in her lower back during the next month and had difficulty working particularly with the prolonged standing and lifting. The plaintiff has continued to suffer from back pain and radiating pain down her right leg.

(5) On 31 July 1994 the plaintiff tendered her resignation after her request for reduced shifts had been declined. At no time had she been advised that she should complete and lodge a workers compensation claim form.

(6) The plaintiff found alternative work with another McDonalds at Macquarie Centre North Ryde where she remained for about three weeks. She tendered her resignation with that McDonalds as they required her to work more than one shift and she was unable to do so.

(7) For the remainder of 1994 the plaintiff remained at school but was unable to return to sport due to her back pain. Towards the end of 1994 or early 1995 the pain in the plaintiff's lower back began to get much worse and she noticed pain in her right leg.

(8) On 13 February 1995 after the pain became worse she consulted her regular general practitioner Dr W K Soh at Ryde Medical Centre.

(9) On 24 July 1995 the plaintiff again consulted her general practitioner who advised that she be taken to Concord hospital. The plaintiff was admitted to Concord hospital and remained as a patient for 5 days. After her discharge from hospital her back did not improve.

(10) Following the plaintiff's hospitalisation she was advised by a family friend that she should see a solicitor as to her legal position arising out of her back injury.

(11) On 1 August 1995 the plaintiff consulted Mr Henrick Isaac of B David & Associates, Solicitors of Blacktown. Between 1 August 1995 to 16 February 1999 the plaintiff instructed Mr Henrick Isaac, solicitor to take legal proceedings in relation to the subject accident. Mr Isaac changed firms a number of times and took the file with him. Up until February 1997 the solicitor did not complete a claim form, did not obtain statements regarding liability and did not obtain any medical reports. On 22 November 1995, Mr Isaacs was advised that the employer had not received a report of injury. On 9 October 1996 the solicitor wrote to the defendant's insurer and advised that his firm Williams Hussain Davidson was acting on the plaintiff's behalf in respect of workers compensation proceedings in relation to the subject accident. On 25 October 1996, the plaintiff's employer again advised the solicitor that there was no record of the plaintiff's injury. On 10 February 1997 the solicitor advised the employer of the accident and enclosed a compensation claim and a report of injury.

(12) On 24 October 1995 the plaintiff saw Dr Ryan, on Dr Soh's referral. On 12 January 1996 the plaintiff saw Professor Tom Taylor at the Royal North Shore hospital for a second opinion. On 23 January 1996 the plaintiff was admitted to the RNS under the care of Dr Ryan and underwent an injection of chromodiasten into her lower back.

(13) On 7 February 1996, the plaintiff underwent surgery, discectomies at the L4/5 and L5/S1 levels of the lower back, performed by Dr Ryan.

(14) In a letter to Mr Isaac dated 20 June 1996 Dr Ryan noted that her recovery from this procedure would be slow. He anticipated that further treatment in the way of stabilisation may be required. On 7 November 1996 Dr Ryan indicated that a spinal fusion would be appropriate. On 17 January 1997, an opinion was provided by Dr James Scougall who agreed that a spinal fusion should be performed. He believed that the plaintiff had a 20% permanent injury to her back and a 10% permanent loss of the efficient use of her right leg. She will be restricted in her choice of occupation. He believed that her condition had stabilised and her present level of impairment of function will remain into the future. As the plaintiff is only very young she chose not to undergo the spinal fusion as she was understandably frightened. She has only recently taken six months leave from university as she is seriously contemplating undergoing an external spinal fixation and a spinal fusion if necessary.

(15) On 4 February 1998, David Baran barrister provided advice to Mr Isaac solicitor. Mr Baran confirmed that the plaintiff had instructed solicitors in about 1996 but as yet no statement of claim had been lodged. The plaintiff is now out of time to sue but should bring a claim for common law damages under the Act . The solicitor was advised to urgently obtain firstly a full explanation as to why no proceedings had been instituted; secondly, a complete explanation for the delay in commencing proceedings; thirdly, a further medical report from either Dr Ryan or Dr Taylor; and fourthly a notice of motion seeking an order that leave be granted to commence proceedings. The advice stressed that the notice of motion should be filed and served as soon as possible.

(16) Both the partners of William Hussain Davidson, Mr Brian Davidson and Mr Isaac have sworn affidavits. The effect of their evidence is that each sheets the blame home to the other at least in part for the delays.

(17) On 31 December 1998, the plaintiff had an initial conversation with her current solicitor, Mr Firth. At that stage he did not discuss the details of her case with her. On the 16 February 1999 the plaintiff attended her current solicitor's office and signed an authority addressed to her previous solicitors for the file to be transferred to Mr Firth's office. After a reminder letter the plaintiff's former solicitor provided the plaintiff's file on or about 13 May 1999.

(18) On 19 May 1999 Ms Hing, an employed solicitor, conducted a review of the file. On the medical evidence as it then stood the matter was unlikely to exceed the common law thresholds.

(19) On 30 March 2000 a conference was held with Mr Menary of counsel. He advised the plaintiff to take workers compensation proceedings. The plaintiff was also advised that she may need urgently to seek leave of the Supreme Court for an extension of time within which to commence proceedings pursuant to s 151D of the Act. On the 27 April 2000 when the matter was listed in the Compensation Court instructions were given to counsel for an application for leave to bring common law proceedings out of time.

(20) In about April 2000, in accordance with advice from Mr Firth, the plaintiff borrowed a baker's tray similar to the one used by the defendant. She purchased buns from Woolworths similar to those used by the defendant. She weighed the buns and tray and ascertained that she had been required to lift a combined weight of about 32 kilograms.

(21) On 10 February 2000 Dr Ryan considered that the plaintiff required multi-disciplinary pain management, weaning off medication and a cognitive behavioural program. He further considered that she is not suitable for any occupation. He assessed the plaintiff as having a 10% permanent impairment of back function and a 10% permanent impairment of right leg function. Currently in order to manage her pain, the plaintiff is taking up to 16 Panadeine Forte per day plus other painkillers.

(22) It was only in about April 2000 after the plaintiff advised her solicitor firstly, that she seriously contemplated undergoing the further back operations that he considered that she would exceed the thresholds and should take common law proceedings; and secondly, the results of the experiment with the crate and buns that the plaintiff had a common law claim.

(23) On the 26 May 2000 a summons was filed to extend time. 3 I turn now to consider whether leave to commence proceedings should be granted. Section 151D(2) of the Act provides: "a person to whom compensation is payable under this Act is not entitled to commence court proceedings for damages in respect of the injury concerned against the employer liable to pay for compensation more than three years after the date on which the injury was received except with the leave of the court in which the proceedings are to be taken." 4 The authorities clearly establish that the onus is on an applicant for extension of time to satisfy the court that it is just and reasonable to extend the time, or as it has often been expressed, that justice is best served if the applicant be given leave to proceed. The starting point for examination of the way in which this discretion should be exercised is Salido v Nominal Defendant (1993) 32 NSWLR 524. This is a case concerning s.52(4) of the Motor Accidents Act 1988 but it is in similar terms to s151D of the Workers Compensation Act 1987. The principles have recently been considered by the Court of Appeal in Holt v Wynter [2000] NSWCA 143, 26 June 2000 and Seib v Morton [2000] NSWCA 139, 26 June 2000. At 532 Gleeson CJ in Salido set out the principles to be considered in the exercise of the discretion. 5 They are: "1. Section 52(4) confers a discretion which is to be exercised judicially, in a manner that furthers the purposes of the statutory context in which it appears. The immediate purpose, as with any limitation period, is to protect defendants against injustice of stale claims; the statute is also aimed at promoting forensic diligence.

2. Bearing in mind those statutory purposes, the question is whether, in the circumstances of each individual case, the applicant for leave has demonstrated that it is fair and just that leave should be granted.

3. The diligence, or lack of diligence, shown by a plaintiff or a plaintiff's legal representatives, in ascertaining and asserting his or her rights will ordinarily be a material factor, as will the extent of the relevant delay, and the reason for it.

4. The nature and extent of any forensic disadvantage to a defendant resulting from the plaintiff's delay will also be material. The effect, if any, of the delay upon the defendant's ability to defend an action is a matter to be taken into account, and may in some cases be of decisive importance.

5. Leave under s 52(4) may be refused if it would be plainly futile to grant it, and in that connection an applicant's willingness and ability to give a full and satisfactory explanation of any delays in reporting to police, notifying claims and commencing proceedings will be material." 6 The plaintiff submitted that she has discharged the onus and established that it is fair and reasonable to extend time in which the action should be brought. Or to put it another way, the plaintiff has established that in all the circumstances, justice is best served by exercising discretion in favour of her. The defendant opposes the orders sought. It submitted that firstly in 1994 the plaintiff was aware of the name of her employer, the manner in which her accident occurred and that she had suffered an injury that caused ongoing pain, secondly her medical condition had stabilised in 1996 and nothing had changed since then and thirdly that it will suffer presumptive prejudice. 7 The accident occurred on 4 July 1994. The summons was filed on 24 May 2000. The limitation period expired on 4 January 1998 (as an additional six month period has to elapse after a notice issues pursuant to s 151C). The proceedings are approximately two years four months out of time. The defendant did not submit that the plaintiff did not have a prima facie case or a real case to advance. In any event, it is my view that she has a real case to advance. 8 In relation to the third guideline in Salido, the lack of diligence shown by the plaintiff's representative is considered a material factor. Studdert J considered this issue in Guest v Southern & Anor (NSWSC, unreported 22 September 1995). Guest is an appeal against the decision of Master Malpass that a full and satisfactory explanation had been given for the purposes of s 52(3). In Guest, Studdert J held that the plaintiff was not personally responsible for the delay and considered it to be reasonable for the plaintiff to have relied upon his solicitors to the extent he did. The plaintiff's solicitors were essentially to blame for the delay. Studdert J held that this was a very material consideration and referred to Sophron v The Nominal Defendant (1957) 96 CLR 469 and Stollznow v Calvert (1980) 2 NSWLR 749. 9 It was in this context, that Studdert J said that the function of the provision s 52(3) is to require the claimant to explain that conduct in the course of providing a full and satisfactory explanation for the delay. It is not to provide a weapon which may enable an insurer to defeat the claim because of such conduct. Similar statements have been made in Morton v Jools (1992) ATR 81-164 and McAndrew v Wyoming Nursing Home (Sperling J, unreported, 5 December 1997). 10 In the case before me, the delay in commencing proceedings can be solely attributed to the plaintiff's legal representatives, particularly Mr Isaac. It is difficult to understand how the solicitor when told in February 1998 by a barrister who was instructed to give advice to commence proceedings urgently did not do so. The plaintiff who was then only 16 years of age saw a solicitor just over a year after the accident occurred. Even though the plaintiff was aware of the name of the defendant, the manner in which her accident occurred, and that she had suffered an ongoing injury, she at all times relied and acted upon the advice of her legal representatives. It was only after four years when her compensation had not come to fruition that she changed solicitors. It must be remembered that the plaintiff had not even reached her majority during some of the years that she was providing instructions. It was her new solicitor who lodged this application within eleven months of receipt of the former solicitor's file. The blame for the delay cannot be attributed to the plaintiff. She is blameless. 11 In accordance with the principles espoused in Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541; 139 ALR 1, it is necessary to examine the prejudice caused to the defendant by the delay. I accept that with the passing of six years there will be presumptive prejudice. The defendant did not submit that it suffered from actual prejudice. On the day of the accident the plaintiff reported her injury to her supervisor and consulted a general practitioner. The defendant's insurer was notified of the existence of a claim on 9 October 1996. This was within the limitation period. The defendant was served with a claim form on 10 February 1997 which was also within the limitation period. There are extensive medical records available which detail the plaintiff's medical condition since the accident. 12 The defendant submitted that the plaintiff's back condition stabilised in 1996 and she knew that she should undergo a further operation in 1998. She was and still is very young. It is understandable that she would be reluctant to undergo such a serious operation at this stage of her life. However the plaintiff's level of pain has increased since 1996 and she has been taking an increasing number of painkillers. She currently takes 16 Panadeine per day plus other painkillers. 13 The plaintiff is a young woman of 21 years of age who has suffered a severe permanent back injury and is seriously contemplating an external spinal fixation and may also require a spinal fusion. Her choice of career is significantly restricted. If the plaintiff is successful in her claim she will be entitled to a substantial award of damages. 14 After taking into account all of these matters I am not satisfied that the chances of the defendant obtaining a fair trial is unlikely. Nor am I satisfied that the defendant will suffer significant prejudice. The plaintiff has discharged her onus and satisfied me that it is just and reasonable to grant leave to commence proceedings. 15 Costs are discretionary. It is my view that the appropriate order for costs is that costs be cost in the cause. 16 The orders I make are:

(1) Leave is granted to the plaintiff to commence proceedings for damages against the defendant for an injury suffered in a work accident on 4 July 1994 pursuant to s 151D of the Workers Compensation Act 1987.

(2) The plaintiff is to file and serve a statement of claim within 14 days.

(3) Costs be costs in the cause. **********

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