GOVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES v WARWICK SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CLARKE, MEAGHER and HANDLEY JJA 3 and 4 November, 1993, 23 November 1993 [1993] NSWCA 120 DAMAGES — further injury increasing damages and attracting compensation rights. WORKERS COMPENSATION — injury — not tortiously caused but increasing damages for earlier tort — compensation rights not affected by recovery of damages. The plaintiff sustained injuries in a motor vehicle accident in May 1987. Prior to that she had sustained injuries on three separate occasions and in January 1988 she injured her back in the course of her employment as a home care worker while lifting a child. The trial Judge found that the motor vehicle accident in May 1987 aggravated her pre-existing low back condition and resulted in a sequestrated disc. His Honour also found that prior to May 1987 the plaintiff was able to engage in full time employment without much difficulty or restriction and awarded damages on the basis that the May 1987 collision was the cause of all her subsequent injuries. These findings were based on misunderstandings of the expert evidence. Held: (1) It was not possible for the Court to determine whether the 1987 injury was the sole or contributory cause of the further injury sustained in January 1988 or whether the lifting incident and the lifting work which preceded it gave rise to a new and independent injury; (2) S151Z of the Workers Compensation Act 1987 does not adjust the burdens of compensation and damages where a worker suffers a tortious injury which creates a vulnerability to further injury which is later suffered in circumstances which attract compensation rights but no fresh cause of action for damages. Kornjaca v Steel Mains Pty Ltd (1974) 1 NSWLR 344 followed; (3) The plaintiffs compensation rights must be taken into account in the assessment of her damages to avoid over compensation. Hood Constructions Pty Ltd v Nicholas (1987) 9 NSWLR 60, Vanramer Pty Ltd v Higgins (1991) 24 NSWLR 661 followed. Clarke JA I agree with the reasons and orders of Handley JA Meagher JA I agree with Handley JA. Handley JA This is an appeal by the defendant from the judgment of Nield DCJ on 26 June 1992 in which he awarded the plaintiff a verdict of $241,696.28 arising out of injuries sustained in a motor vehicle accident on 24 May 1987. As his Honour recognised, the assessment of the plaintiff's damages was unusually difficult because of injuries sustained by the plaintiff on three occasions prior to that motor vehicle accident and on one occasion since. On 12 August 1977 the plaintiff injured her neck, chest, back and right lower leg in a motor vehicle collision, during August 1978 she injured her low back when, in the course of her employment as a nurses' aid she lifted a patient from a bed and on 18 October 1981 she injured her neck when she was involved in a further motor accident. Subsequently on 4 January 1988 she aggravated her low back condition when, in the course of her employment as a home care worker she helped lift a child with spina bifida. 2 UNREPORTED JUDGMENTS The plaintiff had worked as a nurses' aid until her second injury on 28 August 1978. Thereafter she was unemployed until December 1985. On 29 October 1985 she was examined by Dr Segeloy, the well known neuro-surgeon, in the hope that she would obtain approval to return to nursing at Nepean Hospital. Dr Segelov however "felt that this was unwise" and regarded the plaintiff as "still unfit for bending and lifting" and told the plaintiff. She did not return to nursing but in December obtained employment as a housekeeper with the New South Wales Home Care Service. Her general practitioner was Dr Soo and his consultation cards revealed that she had not consulted him for neck or low back pain during 1985. Her employment with the Home Care Service was full time, five days a week for four to six hours a day. She was required to perform housework and to give personal care to clients of the Home Care Service in their own homes. Her duties involved a mixture of light and heavy work. Dr Soo's consultation cards reveal that although the plaintiff consulted him on five occasions during 1986 none of these related to neck or low back pain and she did not consult him for that condition in 1987 until after the motor vehicle accident on 24 May. During this period the plaintiff did suffer from low back pain from time to time but this was not of such severity or regularity as to cause her to consult doctors or interrupt her employment. The trial Judge held that before the accident the plaintiff was "free of neck pain, experienced occasional episodic low back pain, was in full time employment which she was able to perform without much difficulty or much restriction and was living her life as she wished to live it to the fullest". After the motor vehicle accident the plaintiff experienced immediate neck pain and consulted her doctors. On 26 June she was certified by Dr Tan as fit to resume her pre-injury employment on 29 June and she did so. Up to this stage her complaints to her doctors had been confined to neck pain and headaches. On 29 June she went back to work but within ten days she had returned to Dr Tan and between 8 July and 18 August she consulted him on six occasions. She said in evidence that within a week or so after returning to work she developed pain in her low back, sometimes extending into her legs. The plaintiff ceased work on 3 October 1987 and on 8 October she consulted Dr Soo complaining of back pain on and off since the motor vehicle collision and severe back pain for one week. This was the first recording of complaints of low back pain following the May accident. An x-ray was taken of her lumbo-sacral spine on 14 October which revealed slight narrowing of the L4-5 disc space and a CT scan taken on 15 October revealed a broad based posterior protrusion of the L4-5 disc. On 19 or 20 October the plaintiff went back to work but although she was engaged five days a week, she worked for only three and a half hours a day. On 15 November she was examined by Dr Segelov who reported:- "At this stage I felt the patient may have suffered some aggravation of her previous back condition by the effects of the motor vehicle accident but there was no present indication of nerve root compression for which surgical treatment would be of assistance... I returned the patient to the supervision of her referring doctor but would think it unlikely that she will require any surgical treatment in the future. Her limitation in respect of bending and lifting remains." On 4 January 1988 the plaintiff went to work as usual although she had been in considerable back pain before leaving home. She was rostered to help a mother care for her twelve year old child who had spina bifida. She had been engaged in this work five days a week for many weeks. The child weighed about 45 kilos \ROVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES v WARWICK (Handle$ JA) or 7 stone. She and the child's mother had lifted the child into or out of bed twice a day for many weeks. The plaintiff regarded this as light lifting. Normally she lifted the child by the shoulders and the mother by the legs but on this day, because of the pain she was experiencing, the plaintiff lifted the child's legs. When she did so "her back went into spasm and she could not continue". In the period after 4 January 1988 the plaintiff continued to have trouble with her back and had medical treatment. She was again referred to Dr Segelov. On 15 March 1989 she had a lumbar CT scan which revealed "a mild broad-based posterior protrusion of the L4-5 disc. Increased soft tissue density is noted within the right L5 lateral recess. This would be consistent with a small sequestrated disc fragment which has migrated inferiorally and to the right." Following this CT scan Dr Segelov advised the plaintiff to undergo surgery and on 5 April 1989 he performed a right lumbar L4-5 hemi-laminectomy and foraminotomy. The plaintiff resumed casual part-time employment as a child minder on 28 September 1989. She continued in this work, with occasional breaks, until 16 January 1992. Between then and the date of trial on 2 April 1992 she was not able to obtain employment. The Judge found that the plaintiff suffered an injury to her low back as a result of the motor vehicle collision in May 1987 and this finding was not challenged. He also found that this aggravated her pre-existing disability at L4-5 and was not a new injury. This finding also was not challenged. His Honour said that "In view of what Dr Segelov and Dr Korber say, I find that this aggravation resulted in sequestration of the small fragment of the L4-5 disc". This finding was challenged on the ground that Drs Segelov and Korber gave no such evidence. Dr Korber, a specialist radiologist called by the defendant, gave evidence based on the two CT scans taken on 15 October 1987 and 15 March 1989. He said that the sequestration of part of the L4-5 disc could be seen in the 1989 scan but not in the 1987 one. He emphasised that all he was saying was that there was this difference between the two films. He also expressed the view that the sequestrated disc shown in the 1989 CT scan was consistent with complaints of right sided leg pain. Dr Segelov did not give oral evidence but his reports of 9 May 1988, 6 April 1989 and 4 September 1989 were in evidence. At no stage did he state that the aggravation of the plaintiff's pre-existing low back condition in the motor vehicle accident resulted in the sequestration of part of the L4-5 disc. Moreover his report of 9 May 1988 contains nothing to indicate that he was then aware of the lifting incident on 4 January. In his next report of 6 April 1989 the doctor said:- "The patient was reviewed on 16/3/89 together with a repeat lumbar CT scan which I had arranged and this suggested there was a small fragment of disc which had migrated into the lateral recess at the L4-5 level on the right side and which would certainly account for the increasing right sciatic pain. I have arranged for this patient to undergo surgical treatment of this condition... " Again, there is no suggestion that the doctor was aware of the lifting incident of 4 January 1988. In the other report of 4 September 1989 the doctor noted that following the surgery the patient had been relieved of her severe right sciatic pain. He referred to a lengthy letter received from the plaintiff's solicitors of 18 July 1989 and said that he found it difficult to be precise in respect of the disability due solely to the motor vehicle accident on 24 May 1987. The doctor continued:- 4 UNREPORTED JUDGMENTS "Directly following the motor vehicle accident the patient had pain in her back for some five or six days but it was not till some months later that she experienced increasing sciatic pain with subsequent events as noted in my report... On the basis of the history recorded in my notes and on the information supplied by your letter I am unable to reach any more definite conclusion than that already expressed. Certainly the relief produced by the recent surgery suggests that some additional disc protrusion was caused by the motor vehicle accident but I know of no diagnostic procedure which would establish the effects of the car accident more accurately while the operative findings do not allow assessment at the age of the lesion in the lumbar spine". Again it appears that the doctor was not aware of the lifting incident of 4 January 1988. The letter from the plaintiff's solicitors of 18 July 1989 was not tendered. It is clear therefore that Dr Segelov had not expressed the opinion that the motor vehicle accident caused the sequestration of the fragment of the LA-5 disc. Indeed, his reference to the "increasing sciatic pain" that she experienced "some months later' is consistent with this having been experienced on and after 4 January 1988 and his earlier reports suggest that this increased pain was due to the sequestration of the disc fragment. This fragment was not detectable in the CT scan of 15 October 1987. On 5 November 1987 Dr Segelov did not think that surgery was indicated, but thought otherwise when he saw the CT scan of 15 March 1989. The trial Judge said that the weight of the medical evidence was that the lifting incident aggravated the plaintiff's pre-existing condition. He again referred to the opinion of Dr Segelov that the motor vehicle accident had caused additional damage but again failed to note that on the evidence that doctor was not aware of the lifting incident. He said that Dr Smith thought that the injury in the motor vehicle accident was "the major contributing factor to the disc prolapse" (emphasis supplied) but, with respect, this misstated that doctor's report. Dr Smith in his report of 14 February 1991 stated:- "T think her lumbar spine condition has been aggravated by the injury on the 24/5/87 and that this aggravation was continuing at the time of her subsequent injury on the 4/1/88. On this occasion I think she sustained a prolapse of the L4/5 inter vertebral disc which has given rise to the subsequent surgery and is a major factor in her continuing disability. What is debatable is the contribution of the injury on the 24/5/87 to the disc protrusion in January 1988 and I think the May 1987 injury was a major contributing factor for this disc prolapse. She was suffering from continuing back symptoms at the time of the lifting incident and were her back not so affected, dislocation may well have never occurred. If it is necessary to make an arbitrary assessment of the contributions of the three injuries to her present back incapacity I would suggest initial injury 1971 (sic) 15%, injury in May 1987 35% and injury 4 January 50%. These figures are purely arbitrary and each component could be varied as much as 50% and still be compatible with the facts available". (emphasis supplied) His Honour then noted that Doctors Walker, Hession, Thompson and Bray who qualified for the defendant all thought that the aggravation caused by the lifting incident was more severe than that caused by the motor vehicle collision. His Honour added:- "T think that the probability is that the aggravation caused by the motor vehicle collision was much more severe than that caused by the lifting incident because the stresses applied to the plaintiff's body in the motor vehicle collision must have been much greater than those applied in the lifting of the child... I find... that \ROVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES v WARWICK (Handley JA) the motor vehicle collision and not the lifting incident caused sequestration of the fragment of the disc because it is consistent with the plaintiff's complaints and symptomatology after 15 October 1987, because it is more likely to have been caused by stresses greater than the lifting of the child and because of the opinion of Dr Segelov." With all respect to his Honour, this passage contained further errors. There was no evidence that it was more probable than not that the aggravation caused by the motor vehicle collision was "much more severe" than that caused by the lifting incident or that the stresses applied to the plaintiff's body as a result of the collision were "greater" than those applied in the lifting of the child. Indeed, his Honour had previously noted that the plaintiff immediately experienced neck pain after the collision but on her own evidence, did not experience back pain until a week or so after she resumed her pre-injury employment on 29 June and did not complain to her doctors about back pain until 8 October. In my opinion, his Honour was not entitled to find without evidence that the stresses applied to the plaintiffs lumbar spine in the motor vehicle accident were much greater than those applied in lifting the child. His Honour, in the passage referred to, repeats his earlier error, based upon an incorrect understanding of the evidence of Doctors Segelov and Korber that the motor vehicle accident and not the lifting incident caused sequestration of the disc fragment and he refers a second time to the greater stresses imparted by the motor vehicle accident and the opinion of Dr Segelov. His Honour concluded:- "The answers that I have given to the questions that I have posed lead me to conclude that everything that has happened to the plaintiff since the motor vehicle collision of 24 May 1987 and the way she is now can be traced directly to that collision. It is upon this basis that I assess the plaintiff's damages." It is clear therefore that the errors in his Honour's reasoning that I have identified led directly to these findings. In my opinion findings reached on that basis cannot stand. His Honour awarded the plaintiff $44,072.28 for past interference with her wage earning capacity. He noted that she had received workers' compensation payments arising from her work injury on 4 January 1988 which by | April 1992 totalled $26,909.78 gross. This amount, and further payments prior to judgment were only taken into account in calculating interest on past economic loss but were otherwise ignored. He made no discount for contingencies in this award. He awarded $90,435 for future economic loss after allowing a discount of one-third for contingencies but ignored the plaintiff's continuing compensation entitlements. He said he adopted a discount of one-third rather than the usual fifteen per cent "because of her pre-existing low back condition and the long period of time". On 29 October 1985 Dr Segelov told the plaintiff that it would be unwise for her to return to nursing as she was not fit for bending and lifting. He seems to have repeated this warning to her general practitioner on 5 November 1987 and in all probability he conveyed this warning to the plaintiff personally. The plaintiff's decision to continue to do lifting work after 5 November 1987 was not relied upon as breaking the chain of causation or as post-injury contributory negligence. However in view of Dr Segelov's opinion as to the vulnerability of the plaintiff's back to further injury from lifting, there should have been some deduction for contingencies in the award for the past and it may be that a greater deduction should have been made from the award for the future. 6 UNREPORTED JUDGMENTS There are further problems. I have earlier referred to his Honour's finding that prior to 24 May 1987, although the plaintiff experienced occasional episodic low back pain she was able to engage in full time employment without much difficulty or much restriction and was living her life as she wished to live it to the fullest. However Dr Segelov's report of 4 September 1989 to the plaintiff's solicitors states:- "It appears from the third paragraph on page 2 of your recent letter that the patient required physiotherapy treatment from time to time during 1986 with resolution of 'muscle spasm' pains". This is contrary to the plaintiff's evidence and tends to undermine his Honour's findings. It is not referred to by the trial Judge, the plaintiff was not cross-examined about it, and counsel for the appellant did not refer us to it. However, once a case for appellate intervention is independently established on other grounds it seems to me this evidence cannot be ignored in deciding whether this Court can properly reassess. Finally there is the problem of the plaintiff's workers' compensation rights arising out of her injury on 4 January 1988. She was entitled to damages for the injuries tortiously inflicted in the motor vehicle accident of 24 May 1987. This accident may have been the sole or a contributing cause of the further injury she sustained on 4 January 1988 because it increased her vulnerability to such injury. If so the plaintiff would be entitled to additional damages. On the other hand the lifting incident and the lifting work which preceded it may have given rise to a new and independent injury. See generally Neall v Watson (1960) 34 ALJR 364 at 367, Faulkner v Keffalinos (1971) 45 ALJR 80, and March v Stramare Pty Ltd (1991) 171 CLR 506 at 514, 517-518 per Mason CJ. It is not possible for this Court to make findings on these questions. The 1988 injury conferred rights on the plaintiff under the Workers' Compensation Act 1987 to both weekly and lump sum compensation and medical expenses. However the employer liable for the compensation was not liable for the tort. The Workers' Compensation Act 1987 does not provide for the situation where a worker suffers a tortious injury which creates a vulnerability to further injury, which is later suffered in circumstances which attract compensation rights but no fresh cause of action for damages. S151Z(1) provides for the burdens of compensation and damages to be adjusted "If the injury for which compensation is payable under this Act was caused under circumstances creating a liability in some person other than the worker's employer to pay damages in respect of the injury". Although, on his Honour's findings, the injury for which compensation is payable has increased the liability of the Government Insurance Office to pay damages for the tort, that injury was not caused under circumstances which created a liability to pay damages in respect of that injury as such. In Kornjaca v Steel Mains Pty Ltd (1974) 1 NSWLR 344 this Court held that the corresponding provisions in s64 of the 1926 Act did not provide for the adjustment of the burdens of compensation and damages in such circumstances. At 347 Glass JA, who gave the leading judgment, said: "Tt is necessary for the employer to prove against the party from whom the indemnity is sought that the injury occurred under circumstances which created a liability in damages to the worker. It does not seem possible to regard a pre-existing liability, which became more extensive on the happening of the injury, as one which was then created." \ROVERNMENT INSURANCE OFFICE OF NEW SOUTH WALES v WARWICK (Handley JA) This part of the decision was not challenged on the appeal to the High Court and is not affected by that Court's decision. See Dillingham Constructions Pty Ltd v Steel Mains Pty Ltd (1975) 132 CLR 323 at 325. Nor is it affected by the decision in Mahony v Kruschich Demolitions Pty Ltd (1985) 156 CLR 522. As a result the plaintiff will not be required to refund out of her damages the compensation she received prior to judgment and the judgment will not affect her rights to further compensation. However, counsel who appeared for the parties, particularly the defendant, conducted the trial on the opposite assumptions and failed to give the trial Judge the assistance he should have received. On his Honour's findings the plaintiff is entitled to both compensation and additional damages for the injuries she received in the lifting incident of 4 January 1988 and there is no statutory mechanism for the burden of these payments to be adjusted between the parties responsible. In comparable circumstances this Court has held that the plaintiffs compensation rights must be taken into account in the assessment of damages to avoid overcompensation. See Hood Constructions Pty Ltd v Nicholas (1987) 9 NSWLR 60 especially at 71-72 per Hope JA and Vanramer Pty Ltd v Higgins (1991) 24 NSWLR 661 at 671 per Handley JA. The evidence does disclose the weekly compensation the plaintiff was receiving at the date of trial and the parties may have been able to agree on the apportionment of past medical expenses. However there is no material which would enable the Court to determine the lump sums for the injury to her back and pain and suffering to which she is entitled under s66 and s67 of the Act. In all the circumstances there must be a new trial as to damages. In my opinion this Court should make the following orders:- 1. Appeal allowed. 2. Set aside the judgment of Nield DCJ of 26 June 1992 except as to costs. 3. Order that there be a new trial as to damages. 4. The respondent is to pay the appellant's costs of the appeal but is to have a certificate under the Suitors' Fund Act. Appeal allowed. Set aside the judgment of Nield DCJ of 26 June 1992 except as to costs. Order that there be a new trial as to damages. The respondent is to pay the appellant's costs of the appeal but is to have a certificate under the Suitors' Fund Act. RYN Counsel: Appellant: R C TONNER Respondent: P DONOHOE QC/N DELANEY Solicitors: Appellant: G WILSON, SOLICITOR FOR GIO OF NSW Respondent: REIMER WINTER