New South Wales District Court CITATION: Hubbard v Stephen Wells Trading as Wells Plumbing & Anor [2007] NSWDC 93 This decision has been amended. Please see the end of the judgment for a list of the amendments. HEARING DATE(S): 13/11/06, 14/11/06, 15/11/06, 16/11/06, 17/11/06 JUDGMENT DATE: 21 February 2007 JURISDICTION: Civil Civil JUDGMENT OF: Norrish QC DCJ DECISION: See para 80. CATCHWORDS: Negligence - Personal injury - employee - contractor - Civil Liability Act. LEGISLATION CITED: Civil Liability Act 2002 Workers Compensation Act 1987 Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16 Hollis v Vabu Pty Ltd (2001) 207 CLR 21 Boyland Nominees Pty Ltd v Sweeney [2005] NSWCA 8 CASES CITED: Gould v Minister of National Insurance [1951] 1 KB 731 Humberstone v Northern Timber Mills (1949) 79 CLR 389 A/G (NSW) v Perpetual Trustee Co Ltd (1952) 85 CLR 237 Zuijis v Wirth Bros Pty Ltd (1955) 93 CLR 561 JA and BN Bowden and Sons Pty Ltd v Chief Commission of State Revenue [2001] NSWCA 125 Adam Luke Hubbard - Plaintiff PARTIES: Stephen Wells t/as Wells Plumbing - Defendant Wesfarmers Federation Insurance Ltd - Cross Defendant FILE NUMBER(S): 5242/04 Mr D Toomey - Plaintiff COUNSEL: Mr M Murphy - Defendant Mr D Ronzani - Cross Defendant Stacks The Law Firm - Plaintiff SOLICITORS: Haydon Fowler Corbett Jessop - Defendant McCabe Terrill - Cross Defendant JUDGMENT Introduction 1 Adam Luke Hubbard (the Plaintiff) sought damages from Stephen Wells (the First Defendant) and Harrison Friedmann & Associates Pty Ltd (the Fourth Defendant) for their negligence, by reason of which he claimed he suffered severe burns and related injury sustained on 18 December 2001. He claimed he was engaged as an independent (sub)contractor to the First Defendant, in respect of works for which the Fourth Defendant allegedly was responsible as manager and designer of relevant construction. The claim against the First Defendant is the only one outstanding as the Plaintiff has settled with the Fourth Defendant during the proceedings on terms not to be disclosed. The First Defendant cross claims against Wesfarmers Federation Insurance Ltd claiming that the Cross Defendant was liable to indemnify the First Defendant for any loss arising out of any legal liability for which the First Defendant was responsible and that the Cross Defendant had been in breach of an insurance agreement entered on or about the 13 July 2001 by failing to indemnify the Cross Claimant. Alternatively he claims that he is entitled to indemnity for his costs, even if the Plaintiff's claim as an independent contractor fails. 2 The claim of the Plaintiff and the primary claim of the Cross Claimant are essentially dependant in limine on the Plaintiff being found to be a contractor to the Defendant and not an employee. The claim of the Plaintiff is governed by the Civil Liability Act (2002). 3 The First Defendant denies liability and in the alternative, claims that the Plaintiff had caused or contributed to his own injuries, loss and damage. No issue arises under s.5G Civil Liability Act. The Cross Defendant denies the Plaintiff was an independent contractor. It alleges that at the relevant time the Plaintiff was injured, that injury occurred in the course of employment and that thus the First Defendant/Cross Claimant was not entitled to any indemnity under the insurance policy and that therefore had been no breach of the policy of insurance, nor is he entitled to claim in the alternative for costs. Background 4 The Plaintiff, who was born on 9 January 1981, left school at the end of 1996 and commenced employment as an apprentice plumber in early 1997. He completed his Trade Certificate at the end of 1999 and at the end of 2000 completed his apprenticeship. In January 2001 he was awarded a Certificate of Proficiency in Plumbing, Gasfitting and Draining and commenced working for and with Stephen Wells in March 2001. He continued to work on and off for the First Defendant until 18 December 2001, the day he was injured. 5 On 17 December Hubbard, with Wells, attended upon the site of the incident giving rise to his current claims. This was Mr Wells' second attendance at the site but an earlier attempt some weeks before did not go ahead to connect the sewer because of problems with existing services and the job had to be redesigned. The arrangement was for a sewer to be connected to the sewer main (coming from a development at 170 Pyrmont Road, Pyrmont). The First Defendant had contracted with the developer to make the connection. This involved erecting traffic controls so that the public road could be dug up and then building a trench along which the connecting sewer pipe would be laid to connect to the sewer main line. On 17 December 2001 part of the trench was dug, for the length of approximately one lane of traffic. The following morning work commenced on digging out the rest of the trench. However, excavation revealed what was described as a "concrete obstruction" which ran parallel with the curbing of the road in a north south direction, the trench being dug in an east west direction. The concrete obstruction was in the form of a concrete shaft, approximately one and a half by one and a half foot or somewhat larger (up to .6 x .9 metre), roughly square or rectangular. The excavator, hired by Wells and operated by a third person, dug out around the concrete obstruction. Because of the required level for the trench to carry the sewer line to connect to the main sewer line, it was decided that part of the concrete obstruction would be dug away with a "Kanga" (portable) hammer or drill at the bottom of the concrete obstruction. This was done to fit the sewer pipe (which was approximately 150 mm in diameter) underneath the concrete obstruction, at the required level to enable the flow of sewerage into the main pipe. 6 The Plaintiff and Wells operated the "Kanga hammer" digging around the obstruction. The First Defendant believed or knew it contained high voltage wires. The Plaintiff said he did not know nor was he told this was the case. Whilst chipping away at the bottom of the concrete obstruction he struck high voltage underground cables and suffered serious injuries which required him to be hospitalised until 4 January 2002, part of which time was in the intensive care unit at the Concord Repatriation Hospital and which, on discharge, subjected him to a long period of rehabilitation. The Plaintiff claims non economic loss, as well as past and future economic loss. 7 As the respective cases have been pleaded and conducted the key issues to be resolved are: i. Was the Plaintiff an employee or a subcontractor? ii. If he was a subcontractor, was the First Defendant negligent? iii. If negligent, what is the extent of damage suffered by the Plaintiff? iv. How are damages to be calculated including consideration of whether the Plaintiff was contributively negligent? As between the Cross Claimant and the Cross Defendant the issues are: i. Was the Plaintiff an employee or subcontractor? ii. If an employee, is the Cross Defendant liable for the costs of the Cross Claimant? 8 In the determination of these issues I have had regard to the submissions of the parties which are expressly or implicitly addressed. Employee or Independent Contractor? 9 The common and critical issue for resolution in relation to the Plaintiff's action and the cross claim is the issue of whether the Plaintiff was an employee or a subcontractor/independent contractor. The relevant legal principles to be applied in determining this issue may be found in decisions such as Stevens v Brodribb Sawmilling Company Pty Ltd (1986) 160 CLR 16: Hollis v Vabu Pty Ltd (2001) 207 CLR 21 and Boylan Nominees Pty Ltd v Sweeney [2005] NSWCA 8, amongst others referred to in submissions. 10 It had been held that in determining whether there exists an employer/employee relationship, ie a contract for service as opposed to a contract for services, that the "real question" was the "degree of control" exercised by the person employing. Not just "the amount of control" but "the nature of control and the direction in which it (was) exercised" (Gould v Minister of National Insurance [1951] 1 KB 731 (at 734)). "Control" was seen as "critical and decisive of the legal quality of the relationship" (at 733-734). The "control test" was used to determine if a "relationship" existed between the parties. The character of a contract of service has been discussed in Humberstone v Northern Timber Mills (1949) 79 CLR 389 (at 404-405, per Dixon J), A/G (NSW) V Perpetual Trustee Co Ltd (1952) 85 CLR 237 (at 299-300, per Kitto J), Zuijs V Wirth Bros Pty Ltd (1955) 93 CLR 561 (at 571-2). Whilst obedience to orders and benefit to the master were vital, the level of skill was not definitive, ie special skill could still be "employed", so long as there was lawful authority to command. However a number of authorities emphasised the need to apply the "control test" to the "broad spectrum of the relationship" and not to have "the proper application of the test diverted by allowing some particular detail to assume an unwarranted dimension" (The Law of Employment – Macken & Ors). 11 In Stevens v Brodribb Sawmilling Mason J observed that a prominent factor in determining the nature of the relationship between a person who engages another to perform work and the person so engaged is the degree of control which the former can exercise over the latter. The existence of control however, "whilst significant, is not the sole criterion by which to gauge whether a relationship is one of employment". It is merely "one of a number of indicia which must be considered in the determination of that question". He observed that "Other relevant matters include, but not are limited to, the mode of remuneration, the provision and maintenance of equipment, the obligation to work, the hours of work and provision for holidays, the deduction of income tax and the delegation of work by the putative employee" (at 23-24). It is the totality of the relationship between the parties which must be considered (at 29). I refer also to his observations at pp.27-29 accepted by the High Court in Vabu (at [44]-[45]). In Brodribb and Vabu it was held a test which places emphasis on "control" may still be flexible enough to adapt to changing social conditions "by shifting the emphasis and the control test from the actual exercise of control to the right to exercise it" (Vabu at[44]). 12 In Brodribb, holding that the appellant was not an employee, Mason J noted the facts did not support an inference that the purported employer "retain(ed) lawful authority to command" the appellant in the performance of work. The appellant provided his own equipment, set his own hours of work, received payments not in the form of fixed wages or salaries but in amounts determined by reference to the volume of work performed and the authority to organise was limited. In Vabu noting the limitations of the supposed "control test" as expressed by the authors of "The Liability of Employers in Damages for Personal Injury" (at 40-41), the High Court concluded in that matter that bicycle couriers associated with the respondent to the appeal were not independent contractors, notwithstanding the fact that they own their own bicycles and bore the expenses of running them and supplied their own accessories. The couriers were not running their own business or enterprise nor did they have independence in the conduct of their operations. Other considerations that indicated that they were employees were discussed in some detail at pp. 41-45. In determining whether the Plaintiff is an employee or not, having regard to what was held in Brodribb and Vabu, there is the need to assess all the facts and have regard to the whole picture. It is not a mechanical exercise of listing and running through items held to be relevant in other cases (Boylan Nominees at [52]: J A and B N Bowden and Sons Pty Ltd v Chief Commission of State Revenue [2001] NSWCA 125.) 13 In Boylan Nominees, it was noted that the purported employer exercised no control over the work carried out by the person whose actions injured the respondent. It was said in that matter that: "The absence of control means that the very essence of the employer/employee relationship is missing. It would be a very strange kind of employee over whom the supposed employer can exercise no authority". 14 There was, in that matter, an absence of "mutuality of obligation" to provide work for a particular period, even it be only a reasonable period and to work for that period. "Such a mutuality of obligation is a usual ingredient of the employer/employee relationship" (at [56]). The fact that the worker was "free to accept or decline work is a strong indication that he was not an employee". Further the person in question carried out work under his own business name, provided his own equipment and tools, sometimes brought his own spare parts from other suppliers, was paid on a peace work basis and provided his own workers compensation, public liability insurance and superannuation". The purported employee "was independent of Boylan's enterprise to such a degree that despite the references to "our mechanic" … he could not properly be regarded as an employee. He was, in essence carrying on a trade or business of his own" [55-58]. Whilst the views of the respective parties and their belief as to the character of the relationship at the relevant time is important, ultimately the Court is required to assess the objective picture considering in that assessment the state of mind of each of the parties. 15 In the context of these principles, and their application in the facts of those cases I consider the issue of whether or not the Plaintiff was an employee or a contractor. This is a matter not without difficulty. There are a large number of aspects of the relationship between Mr Wells and Mr Hubbard which, as indicia of the position, point in different directions. Both the Plaintiff and Mr Wells gave evidence of the character of the work performed by Mr Hubbard. Up until September 2001, on the evidence available, there can be little doubt that the Plaintiff was regarded by himself and Mr Wells as an independent contractor. The Cross Defendant has scarcely, if at all, argued to the contrary. The work provided by Wells was sporadic, the Plaintiff was working for and with other people, providing his own tools, no tax was deducted or withheld and he was paid on a daily basis for work done when it was mutually convenient for his services to be provided. There were other indicia of this type of working relationship, yet the Defendant "controlled" the work performed for him by Mr Hubbard when he worked. He also paid the Plaintiff "wages" according to his cheque records for August/September. The critical issue is whether the relationship changed from contractor to employee from about mid October 2001. 16 Mr Hubbard gave evidence that in September he was desperate for work and he was told by Wells that there would be a lot more work later in the year. In fact he was provided with more work, however, he claimed in evidence that he was available to work for other plumbers and asserted that he was working on average 2 to 3 days for Wells up until the time of the accident. From 31 October he did not work for anybody else before he was injured. It is common ground that during this period he was not wearing any uniform provided by Wells, he provided his own hand tools and from time to time provided his own transport. Mr Wells claimed that he did not "employ" the Plaintiff at any time. Although from October 2001 he had calculated payments to the Plaintiff by deducting relevant tax instalments, he did not expect the Plaintiff to provide invoices. Yet he received invoices from "other contractors". He had described payments to Mr Hubbard in financial statements of his family trust (which apparently controlled the business) as "wages", and did so on one cheque butt showing payments to the Plaintiff between October and 18 December 2001. He also filled out a "PAYG" Summary at the end of 2002 tax year for the Plaintiff's tax return. He prepared that on the advice of his accountant and had little understanding of its legal effect. 17 The Plaintiff and the Defendant in their evidence were largely in agreement as to the character of the relationship at the time of the accident to which evidence I will return later, but saw their arrangement from different perspectives. Although the Plaintiff saw himself as having a "permanent position" and saw himself as being "employed" at the time or shortly afterwards, Wells did not see it that way. Mr Wells was adamant that Mr Hubbard was not "employed". Both were generally impressive as to their recollection and presentation on this important issue despite material put to each which might have been regarded as inconsistent. The Defendant was unshaken in his belief, albeit somewhat compliant in the hands of the Plaintiff's Counsel on this topic. The Plaintiff addressed the supposed contradictions suggested in his statements to WorkCover with equanimity. There were however, given their respective approaches to the arrangement, good reasons for them seeing the arrangement differently. There was a body of "contemporaneous" documentation (or at least created closer in time to 18 December 2001) which is internally inconsistent and to some extent inconsistent with the versions that the Plaintiff and Defendant have given. As well I have noted that the view of those witnesses in reflecting upon the period in question (mid October until 18 December 2001) is coloured or affected by subsequent events, both consciously and unconsciously, and the passing of time. The credibility of these witnesses is of some importance but many objective facts and circumstances do not turn upon credibility issues or accuracy of recollection. 18 Before turning to that material, including statements made by the parties to third parties and financial records of Mr Wells, it should be noted that the evidence establishes Mr Wells was clearly a very disorganised and inefficient businessman. His relationship with Mr Hubbard was not formalised by any contemporary record, such as a contract of service or any other written document which might identify any conditions of 'employment' or retainer. Such an agreement, if it existed, itself may not be decisive. His arrangements with those who worked with and for him were flexible. It would seem that he did not have proper insurance arrangements in place, his own accounting and other records were woefully inadequate and, apart from some input from his wife, most advice that he received from professionals in relation to his accounting and other records would appear to be ex post facto attempts by either his accountant or himself to tidy up the mess that his inability to keep proper records, his informality and his failure to make proper arrangements with Mr Hubbard, had created. Likewise the Plaintiff was not a meticulous record keeper, nor particularly well organised in relation to his work affairs. He approached his work arrangements in an informal way, working for the moment, not with any long term plan in place at this time and wishing to be flexible as he could in attending to his work commitments. Like many young men he was more concerned about living his life than planning a career at this time. He lived at home, with few major financial or personal commitments. Furthermore there was just the two of them, no formal organisation that might assist in assessing their relationship. 19 Ultimately the evidence does not establish that there was any real agreement between the parties as to what obligations the First Defendant was to undertake. The actions of Mr Wells reveal him to have a very relaxed attitude to the arrangement, not taking some basic steps to signify or protect the "employment" of the Plaintiff. 20 As to the recorded statements of the parties after the event, on his discharge from hospital on 4 January 2002, the Plaintiff made a claim under the "Uninsured Liability and Indemnity Scheme" upon WorkCover (NSW), pursuant to s.141(2) Workers Compensation Act. On 21 January 2002 Mr Hubbard filled in a claim form for the WorkCover Authority in which he described Steve Wells as his "Employer" for the purpose of a claim in that form. Clearly, he was seeking "workers compensation" at that time and understood, in my view, that he had to be an "employee" for this to occur. In that form, as with the other statements made by the Plaintiff, he stated that he was not carrying on trade or business on his own account or in partnership with others. He stated that he was working "forty hours" per week prior to his injury. He stated that he had "no … other employment". He agreed in evidence that when he filled in the Form he believed that he had been "employed". However, some of the particulars supplied do not fit with truly contemporaneous records. 21 WorkCover served a notice on Mr Wells dated 15 February 2002, requiring him to provide particular information to the Authority. 22 In the "Notice" the Defendant was asked to provide the following information: "2 . PARTICULARS OF WORKER AND EMPLOYMENT (A) Was the above named worker employed by you? Yes/No If "Yes": Describe how the worker named above was employed by you example, directly employed, subcontractor, outworker, other …." (emphasis added) . The Defendant described his relationship in response as … "(A) Subcontractor." 23 At paragraph 7 of that Form "Your comments on this claim:" Mr Wells wrote: "Adam contracted to Wells Plumbing for a period of 7 – 8 weeks. Till the accident (sic)". 24 25 Mr Wells had prepared a further document for the benefit of WorkCover dated 15 February 2002 claiming that: "ADAM HUBBARD contracted to Wells Plumbing from 15/10/2001 to 18/12/2001 in which time he was paid $635.00 per week, this included his tax ($135.00)." 26 This "invoice" asserts that the Plaintiff was paid $635.00 per week for this period, yet that does not accord with any financial record produced as relevant to the Defendant's business including the relevant bank statement for this period. Neither did the cheque for $1,080.00, given to Mr Hubbard by Mr Wells for tax deducted, accord with what the contemporaneous cheque butts reveal to be payments made for work performed by the Plaintiff. In a claim form made for his public liability insurance the Defendant described the Plaintiff as: "Subcontractor", when particularising the Plaintiff's "Relationship to Insured". Mr Wells may have been protecting himself because of his failure to have "Workers Compensation" insurance. 27 Subsequently, the Plaintiff stated on 25 March 2002, in a statement prepared by the WorkCover Authority from information he supplied in relation to the circumstances of his injury and the character of his relationship with Mr Wells: "4. When I started with Mr Wells he did not have any other employees. I started on an arrangement whereby I was paid $800.00 gross per week. I did not work for anyone else and I did not employ labour on my own behalf. Mr Wells controlled where and when I worked and he supervised my work in that he overlooked all my work. I often worked on site alone. I only supplied a few hand tools and labour, with Mr Wells supplying all other materials required. As at that period, the work was not consistent and I was only being paid for the work that I actually performed. I never had to submit invoices and I was not allocated leave entitlements. Mr Wells was not remitting any tax on my behalf at that stage. I was responsible for remitting my own income tax. 5. That arrangement stayed in place until September 2001. Mr Wells ran out of work at that stage and there was nothing for me to do. Sometimes during September 2001 Mr Wells came to me and told me that he would be having more work and he agreed to employ me on a full-time basis. He agreed to pay me $502.00 nett per week and with leave entitlements. I was not working for any other employer and I still was not engaging labour on my own behalf. He still directly supervised my work and supplied all materials required." 28 He went on to say: "I commenced on this arrangement on 15 October 2001. I did not carry my own workers compensation or other insurances. Mr Wells was paying me in cash with no records or payslips being issued to me." 29 I point out in passing that he then gave an account in relation to the circumstances of his injury in this statement largely consistent with the account he gave in evidence before me. 30 In relation to this interview, the Plaintiff said in evidence that he understood that the interviewer was a representative from WorkCover and that he was required to give correct information. He had read the statement before he signed it and the information he agreed was "true and correct". He agreed that his recollection in March 2002 as to events between October and December 2001 was better when he made the statement than when giving evidence at court. He accepted that he was subject to Mr Well's supervision but that whether he was "trading" on his own was "debateable". He agreed that he did not submit invoices for work done and he said that the work he had done for Mr Wells leading up to the accident in December 2001 was work "that would answer the description of casual work available". From very late October he did not work for anybody else, but his group certificates show that he did work for another employer during the last few weeks of October 2001 and, in any event, he was not working 5 days a week for Mr Wells, nor being paid at consistent intervals or in identical amounts. I accept this and other statements accurately reflect the way in which Mr Wells, "controlled", that is supervised and directed him at work. 31 In another statement made on 16 September 2003 for an insurance claim he stated in respect of "Employment History": "I began employment with Stephen whilst plumbing in about March 2001 . I started on an arrangement when I was paid $800 gross per week. On 15 October 2001 I became a full time employee of Stephen Wells Plumbing, earning $502 nett per week plus leave entitlements." (emphasis added). 32 Contemporaneous records of payment are not entirely in accord with the assertions in the last sentence quoted in the "Employment History". On 19 October 2001 he paid the Plaintiff $450.00, on 2 November, 16 November, 30 November $502.00 (which was $635.00 less relevant tax withheld) on 7 December 2001 $500.00 and on 21 December 2002 $1,000.00. He had previously been paid $600.00 on 17 August 2001, 24 August 2001, 21 September 2001, and 29 June 2001 for "wages" in each instance when the Plaintiff was not an "employee". Again in this statement he gave an account of the circumstances of his injury and matters relating to the effect upon him of his injuries generally in accordance with the evidence he gave in this court. 33 In respect of the interview that led to the creation of this statement he agreed in evidence that he had written; "I began employment with Stephen Wells" and that the response given was truthful at that time. However, he also understood that to be an employee in the legal sense his "employer" was to take out his tax, have a Workers Compensation policy and look after every facet of what he needed to be supplied as an employee of his company. He agreed that his understanding arose from the discussions had in September 2001 but that by September 2003 he had come to know that Mr Wells had not "honoured" his side of the agreement. He did have an understanding Mr Wells would provide "full time work". The Plaintiff said in evidence that his memory now did serve him well enough "now" to say whether or not Mr Wells offered him "full time employment". 34 What emerges from the evidence of the Plaintiff was that in effect he understood that he had been given "full time employment" by the Defendant in the sense that he had a full time "retainer" from mid October until the date of his injury. His adoption and/or use of the words "employee, employer … employment" in the various documents he completed or signed may reflect his view of the arrangement but those expressions do not necessarily establish their "legal meaning". I accept the Plaintiff's use of these terms does not have of itself legal effect but may be construed as admissions, if reasonable to do so in the context of all the evidence. Ultimately I do not believe they are. I doubt that the Plaintiff had read or been advised of, the judgments in Brodribb and Vabu. His expression may be viewed as colloquial, although potentially persuasive. This full time "retainer" in fact did not strictly occur in any event, as the record of payment of "wages" revealed in relevant cheque butts, makes clear. Also I note that he was paid for work done up until 30 October 2001 by a Taxi Truck and Removals business according to a PAYG Summary, the accuracy of which I have no reason to doubt even though it was not referred to expressly in his evidence. 35 The Defendant not only did not see the relationship this way, but it would appear that he did not take such steps as would be consistent with the treatment of a full time employee. In his evidence he said when the Plaintiff was retained Mr Wells did not set aside money for taxation, nor make allowance for superannuation or make any superannuation payments nor did he regard the Plaintiff as an employee. He said that the Plaintiff was required throughout the time that he worked for Mr Wells to supply his own hand tools and was entitled to work with someone else if he wished. He admitted also that he did not "have" any Workers Compensation insurance for the Plaintiff between October and December 2001, because he did not deem him to be an employee. He did in fact "withhold" tax or "make some provision for his tax" from September/October onwards, on the advice of his accountant. The figure "withheld" was calculated by his accountant, prior to the Plaintiff "coming back to work" in October 2001. The tax calculated was on a gross figure, calculated on a daily basis. He said that he was "paying him on a block of five days at a time … some weeks we work three days and two days and then we just paid him in a block amount, because it worked out that way with tax". He said tax was to be withheld in the period October to December 2001 because the Plaintiff did not have an ABN (Australian Business Number) or "contractors tax number", although he did have a Tax File Number (TFN). 36 The Defendant said that he had been advised by his accountant that some provision should be made for the tax of the wages of the Plaintiff "even though he was a contractor" otherwise the Defendant would in some way be "liable". He understood that he was to withhold tax if no ABN number was supplied by a contractor. Although I was not addressed on this, the "2002 Tax Guide" confirms this to be appropriate practice. In fact, he had not remitted any taxation deductions to the Australian Tax Office, instead giving the Plaintiff the cheque for $1,085.00 in February 2002, for the Plaintiff to forward onto the Tax Office. The Defendant denied that he had done this because he was "in trouble with WorkCover", for not having Workers Compensation insurance, and there seems frankly no reason for him to have provided the cheque for that purpose. There was no progressive provision for tax "withheld" in his contemporaneous records. 37 Financial records of the "Wells Family Trust", which appear to be mixed up with Mr Wells' business records and prepared apparently in April 2003, suggest that cash payments to the Plaintiff before September for work done were described as "cash", but thereinafter payments to him for work performed were described as "wages". The cheque butts tell a different story. The Defendant pointed out that other "wages" were paid to family members although work was not performed but this is beside the point. The "Session Report" records, prepared as they are by an accountant, shed little light on the situation, taken in conjunction with the cheque butts produced. Particularly given the fact that many of the payments in the period of time between October and December recorded in the Session Report for "Salaries and Wages" (which can be identified as relating to payments to the Plaintiff) are for various figures, some consistent with the purported "agreement" for payment on employment referred to by the Plaintiff in his statement to WorkCover and elsewhere (2/11/01), but many others inconsistent with that figure. It appears the Plaintiff was sporadically paid and not consistently paid as would be the case with weekly wages. 38 In his "2002 Tax Return" the Plaintiff claimed the moneys paid to him by the Defendant for that tax year as "Salary or Wages". It should be noted however that this included "Salary or Wages" paid by other ABN payers, who themselves had not "employed" the Plaintiff. The Defendant agreed that he had never filled out a "PAYG Payment Summary", for any independent contractor that he had contracted in the "20 odd years" that he had been in business, other than the Plaintiff. Such "Summaries" have been in place, however, only since 1 July 2000. In that tax return for the 2002 tax year he identified gross payments of $4,100.00 from Mr Wells as "salary or wages". That tax return had attached to it a "P A Y G Payment Summary", issued by Mr Wells dated 6/9/02, in the name of the company that took over the conduct of his business in early 2002. The differences in corporate or business title are of no moment. Mr Wells conducted several businesses at about the same time. "Wells Plumbing" ceased to trade in about June 2002, replaced by a corporation called "Sweftclean Pty Ltd", which he had taken over in February 2002. At the time of the accident he was trading as a "sole trader" under the name "Wells Plumbing". "Sweftclean" became "Acclaim Civil Pty Ltd", which commenced trading under that name in March/April 2002. The figure for gross payments in the "PAYG Summary", does not accord with any actual payments made to the Plaintiff, either for the period between mid October to mid December 2001 and/or the prior period when moneys were paid to the Plaintiff for work done between August and October 2001. What is disclosed in the P A Y G Taxation Summary would appear to be a ex post facto reconstruction of payments made and deductions made that bears little relationship to any reality. This is no fault of the Plaintiff in any way shape or form. Bearing in mind no "pay slips" were provided to the Plaintiff, he could do no more than rely upon such information as was provided to him by Mr Wells, in summary, at the end of the tax year during which the Plaintiff was injured. The provision of a PAYG Summary is itself not conclusive of anything so far as the Plaintiff's status is concerned. "Withholding" of payments by the "PAY AS YOU GO" system, operative from 1 July 2000, may be made for "employees" or for those supplying labour who do not provide an ABN or other "non employee" situations (Australian Tax Handbook (2002) ATH, pp 16120 – 1656). 39 He did not request Mr Hubbard to provide him with a "tax invoice" during the time that Mr Hubbard worked for him from October through to December 2001. He did not remit any taxation deductions to the Tax Department, although he claimed that he intended to do so before the accident. He had not remitted the tax otherwise payable to Mr Hubbard he said because the Plaintiff had "only worked for such a short period of time before the accident". In reality I do not think he had applied his mind to the issue at the time. In the short term it was cheaper for him to pay the nett sum, rather than a gross sum. The payment of wages in this way was a matter of personal convenience for Mr Wells and the Plaintiff. The Defendant's accountant, who had given him the relevant advice about this matter was not called to give evidence, he was living interstate. That person was not a full time accountant, but usually worked as an accountant for a banking institution in 2001/2002, as I understood the evidence. He kept Mr Wells' books on a "private" basis. His absence from the case I have taken into account, but even if it is the case that if called he would not help the Defendant's claims, the picture can be seen without his assistance. The supposed "advice" given was apparently in accord with the tax law as it then applied. Mr Wells was not a competent enough businessman to follow it to the letter in any event and the accountant had no responsibility for that situation. Any references to the Plaintiff being an "employee" in Mr Wells' records was not a reflection of his intention on this matter and not just because of his failure to have "Workers Compensation" insurance. 40 Importantly Mr Wells accepted that he "controlled" where the Plaintiff worked when he worked for Wells Plumbing and what work he did. He also supervised the work that Mr Hubbard did. However, Mr Wells had 20 years experience and the Plaintiff was a person with limited experienced and was not a licensed plumber. 41 Wells allocated work, and when present directed the Plaintiff as to how he wanted the work performed because of his greater experience and because he was the principal contractor. The events of 17 and 18 December 2001 are an illustration of this. He knew what each job precisely required. If the Plaintiff was left to his own devices it would seem that he had a discretion as to how the job would be done, subject to satisfying Mr Wells that it was the job he had contracted with his principal to perform. The control was limited, not all encompassing. The Plaintiff was not simply retained for one job over the period, clearly there were a number of separate jobs, some small, some large, that overlapped. While the "arrangement" allowed first call on the Plaintiff's services as far as he was concerned and, from the end of October until 18 December, he did not work for anybody else, I am ultimately satisfied that the Plaintiff was free to work for others if not required to work by Mr Wells, at least in the view of Mr Wells, but that Mr Wells could have first call on his services. The truth was the Plaintiff was happy to work when Mr Wells required him and not otherwise from 31 October until he was injured. There are aspects of this arrangement that have the hallmarks of the control required for an "employer/employee" relationship to exist, but the evidence reveals that the parties had different views of what was required of the other, particularly as to what Mr Wells was to do to ensure the financial security of the Plaintiff. Even if the Plaintiff believed he was "employed", there was not enough "mutuality of obligation" to establish that he was at least a part time "employee" given all the circumstances and the objective indicia of the arrangement. 42 I note of course that Mr Wells admitted his guilt to an offence alleging that he had failed to have a Workers Compensation policy in place for the Plaintiff (the precise particulars of which offence are not known to the Court) for which he was fined. He did not contest the fine on the basis that he did not have any employees because he thought that ruling was "final". The truth of the matter was that Mr Wells' affairs were in such a tangle over this incident and he had no desire to embroil himself in further legal tangles. He was prepared to "cop the fine on the chin", perhaps to save himself more anxiety and trouble, perhaps to help out Mr Hubbard's "Workers Compensation" claim. This may have been, of course, an admission by him relevantly that the Plaintiff was employed. It may have been an attempt by the Defendant to resolve the difficulty created by his lack of administrative care and to ensure that Mr Hubbard received some protection from relevant "safety net" provisions that came into effect where insurance had not been taken out. His admission of guilt is not decisive and does not accord with other indicia. 43 Thus an examination of the contemporaneous records, subsequent statements and declarations made by the Plaintiff and the Defendant, their evidence about these and other related matters establish in summary and in no particular order: i. Between 31 October and December the Plaintiff only worked for the First Defendant and when he worked for Wells his work was "controlled" to some extent, but not entirely, as the Plaintiff worked at the direction of Mr Wells, subject to work being available. However, work was not continuously available. So far as Mr Wells was concerned the Plaintiff could have worked for another "employer/contractor" if work had been made available to him and Wells was the more experienced plumber who had ultimate responsibility for the quality of the work performed. ii. Whilst the Defendant had been advised to withhold tax before the arrangement commenced, he did so on the basis that the Plaintiff had no ABN. In any event he did not withhold the tax as he was required to with each payment, but paid it to the Plaintiff for him to pay to the ATO. iii. The Plaintiff was not supplied with any uniform but was provided with any equipment he needed by Mr Wells, other than hand tools. Transport to and from jobs may or may not be provided by Mr Wells but usually the Plaintiff transported himself. The Plaintiff did not send out invoices, but he never had an ABN even though he had been a contractor to Wells and others before this arrangement. iv. The Defendant made no allowance or payment for superannuation contributions at any time. v. The Defendant made no allowance or contribution for any leave for which the Plaintiff may have been entitled, nor paid any on termination of the arrangement with the Plaintiff's injury. There was not even a "sympathy" payment after the accident. There appears to have been no formal termination. vi. The Plaintiff regarded himself as "employed", because he believed he was to be provided with work that would occupy him "fully". 44 He believed that certain things would be done, which in fact were not done, consistent with Mr Wells being an employer. vii. Mr Wells had undertaken to provide the Plaintiff with work on a "full time basis", but did not and was not able to do so. viii. Payments of wages were neither consistently made nor for consistent amounts. ix. Ultimately, there was no mutuality of obligation between the parties nor any agreement as to what were "mutual obligations". 45 Subsequent to the Plaintiff's serious injuries, both men were left in a difficult situation so far as any "compensation" might arise for the Plaintiff. The Plaintiff had to be an "employee" to receive "Workers Compensation". The Defendant was liable for not having a Workers Compensation policy, unless the Plaintiff was a "contractor". Neither man, at any stage, would have had any understanding of the legal "test" for determining employment and ultimately, in the context of the scramble to sort out matters of compensation, tax liability and the like, both men have clung to the notion of "employer/employee" and/or "contractor" as it suited the exigency of the situation rather than reflecting upon the reality of the situation. These matters to some extent have infected their recollection. Was the First Defendant Negligent? 46 The only direct evidence of the circumstances in which the Plaintiff was injured comes from the Plaintiff and the Defendant. In explaining the circumstances of the accident the Plaintiff was a more impressive witness than the Defendant who appeared somewhat defensive on the critical issue of dispute. The Plaintiff's description of events was straightforward and ultimately unshaken in cross-examination. Except for the key issue of whether there was forewarning of danger there was little variation between their respective versions. Where their versions vary I accept the Plaintiff's account. There is no independent evidence to contradict it. Although his account of events afterwards was affected by his injury (he thought the ambulance came by bicycle) his memory of events beforehand was relatively clear and he was unshaken. Further, his accounts of the incident over the years have generally been consistent. 47 The background to 18 December 2001 I have already outlined. The Defendant was the person contracted to provide the services to connect the sewer of the development to the main sewer. The Plaintiff and the excavator, as well as a traffic control person, were engaged by the Defendant to perform the task. The relevant plans available for locating services and to assist in the work were in the possession of the Defendant and on his own account he examined them. He also had the responsibility for making relevant enquiries of service providers, particularly electricity service providers, as to the location of services. This he did not do, but this is not critical, as the plans gave him relevant information. The Plaintiff had been told by the Defendant that it was a "tricky job" and at all relevant times in performing the work the Plaintiff consulted the Defendant and sought direction from him. 48 On 18 December the work of the day before continued excavating the trench to enable the relevant piping to be laid to connect to the main sewer. Traffic control was in position, the excavator was present and the Plaintiff and the Defendant did some hand digging. Sometime after noon the excavator came across what was described by the Plaintiff as a "hard object" and after digging around it a block of concrete earlier described was exposed. It was a structure with which the Plaintiff was not familiar. He thought it a footing to the nearby Western Distributor off/on ramp. 49 Inside the trench the Plaintiff and the Defendant had hand tools as well as the "Kanga hammer", which the Defendant instructed the Plaintiff to use to clean underneath the exposed beam and remove any sort of "dag", or shale or loose bits of concrete attaching to the bottom of the beam as earlier explained. This was to enable, in due course, the sewer pipe connecting to the main sewer to be laid underneath the beam. I am satisfied at least on the balance of probabilities that the Plaintiff was not informed by the Defendant that he knew from the plans available to him and discussion he had with others that the concrete object carried within it electricity services. Wells claimed that he "probably" made the Plaintiff aware that there was electricity "in that beam". He said this was before they "physically" got into the trench on 18 December. Whilst there were plans available for the Plaintiff to examine, I am satisfied he gave them only cursory examination and did not have anything within them brought to his attention concerning the location of electricity services. Mr Hubbard had no need to examine them in detail because he was performing the work under the direction of Mr Wells and relied on his experience. The Plaintiff was not experienced in dealing with excavation around high voltage cables. Although some of the work involved plumbing skills, essentially the work he was doing at the relevant time was of a labouring character. The plans were close by on the ground alongside the trench at one stage, but there was no need for him to examine them. He did not speak to or consult, anyone else associated with the project or advising it, concerning the work. There was no need. The Defendant indicated that the folder in his possession had in it plans identifying the location of any electrical services. 50 The Defendant was aware of the risks because in his excavation work around the beam he used a trowel so that the scraping away could be accurately and carefully done. He did not consult with Energy Australia concerning the appropriate way to clean away the material around the concrete obstruction (it apparently being the relevant authority to consult on this matter) and he knew that digging around any area where there were high voltage power lines was "extraordinarily dangerous". He also knew, being "very much more experienced" than the Plaintiff that the Plaintiff would obey any direction he gave in relation to the performance of work. 51 He instructed the Plaintiff to remove some of the dags and other irregularities from the bottom of the concrete beam. He did not tell the Plaintiff to be careful. He did not tell the Plaintiff that there was a risk of coming in contact with high voltage wires or that there were high voltage wires in the vicinity of where the Plaintiff was to dig with the Kanga hammer. It was in these circumstances that Mr Hubbard, not knowing the proximity of high voltage wires, not even knowing the concrete structure contained high voltage wires, commenced to use the Kanga hammer to chip away at the bottom of the concrete beam and came in contact with those services, apparently carrying up to 33,000 volts of electricity. The calamitous results for the Plaintiff when he came in contact with the power lines, given the fact that he had in his hands a metal object, were inevitable. I accept the Plaintiff's account that when he used the Kanga hammer at the relevant time, on the instruction of the Defendant, he chipped off what he thought was enough but that he was instructed to "knock of the last little bit of concrete" attaching to the underside, at which time the Kanga hammer came in contact with the high voltage wires and there was a "big explosion". 52 An obvious question that arises is, why the Defendant, who I accept got along well with the Plaintiff and I am sure would not have deliberately exposed him to risk of injury, would not convey the important information as to the potential risks within his possession? Although this is not directly exposed in the evidence it would appear that the Defendant assumed that the Plaintiff whilst he was cutting away dags from the concrete structure, would not come in contact with the power lines. As it was he either did not know or had not closely checked the proximity of the high voltage wires to the bottom of the concrete structure. 53 The legal issue is simple. Nobody submitted to the contrary. There can be absolutely no doubt that the Defendant had a duty of care to the Plaintiff and breached it, exposing the Plaintiff to the real risk of injury, by failing to warn him of an obvious potential danger to him by directing him to perform the particular task of digging with the Kanga hammer in the vicinity of the bottom of the concrete beam. By reference to the particulars of negligence pleaded, he most relevantly breached his duty of care to the Plaintiff as pleaded in particulars of negligence (b), (d), (j) and (k) set out in the Statement of Claim. Because of this the Plaintiff suffered damage. 54 No issue of contributory negligence (s.5R Civil Liability Act 2002) can reasonably be identified, nor any issue pursuant to s.5G of the Act. As the Cross Defendant's Counsel, in his eloquent manner, stated it, if the Plaintiff did not know of high voltage cables in the concrete structure "there was no contributory negligence". The Plaintiff was unaware of the risks of the work he was performing and had no reason to be aware of the risks, working at the direction of the Defendant, relying upon him for instruction as to how the work was to be performed and believing, quite reasonably, that either the Defendant directly, or in consultation with others, would locate and warn relevant services. Injuries of the Plaintiff 55 The Plaintiff suffered burns to his face, torso and arms covering approximately 30 percent of his body. Initially it was thought that he had suffered airway burns. He was treated at Royal Prince Alfred Hospital but was then transferred to the 'Burns Unit' at Concord Hospital where he was initially treated in intensive care. He was finally released from that hospital on 4 January 2002. The burns were not "full thickness", but "partial thickness" burns and although he needed intensive treatment to ameliorate pain, and to assist in the repair process, he did not require "surgery". Instead he was treated with a new process to aid skin repair. The hospital notes detail the intensive treatment he received over almost 3 weeks in hospital. On release from hospital he was fitted with pressure garments and was required to attend outpatients at Concord for dressing changes and other treatment, initially, for 3 months, once a week, and then twice a month for a further three months. He had to travel from his home near Caringbah. By early 2003 there was no longer any scarring on his face, or on the anterior of his chest but he had other scars including extensive discolouration of his right upper limb, atrophic appearance of the skin on the dorsum of his right hand, some deep pigmentation of the skin of his left upper limb, some atrophy of the skin on the dorsum of his left hand, poorly defined pig skin appearance in irregular patches on both thighs, very large noticeable scarring on the posterior aspect of his left thigh and left calf and further obvious scarring on this right thigh and on the bulge of the calf of his right lower leg. The graphic colour photographs of his injuries, or some of them, taken while he was in Intensive Care, underline how fortunate he is not to be more extensively and permanently disfigured. The pain he suffered in the immediate period after 18 December must have been immense. The evidence establishes that the scarred and effected areas are more susceptible to damage from the sun and from injury from relatively minor contact. 56 The expert on burns injury retained by the Plaintiff, Dr John Giles, a plastic surgeon, concluded that the Plaintiff had suffered extensive partial thickness burns and although these had all healed without the need for surgery and the resultant scarring was "cosmetically acceptable", the effected areas would never be "as strong as normal skin" and would restrict him working out of doors, in hot environments and with certain chemicals. 57 This conclusion is supported by other opinions. In 2005, when assessed by the Fourth Defendant's retained expert, Mr Edward Gibson, another plastic surgeon, it was noted that the burnt areas were more vulnerable to sunburn than normal skin, the burned areas were more easily injured than normal skin, the Plaintiff had tightness of both hands on flexing the fingers and was concerned about scars to his arms, hands and both legs. The surgeon observed various scarring in the areas previously observed and it was noted that the Plaintiff had vulnerability of the scarred areas to injury, such as trauma, chemical agents or sunburn. He was also noted to have "an impairment related to disfigurement from the burns". Like Dr Giles, Mr Gibson was of the view that further surgery was not required. I have noted the assessment made by both him and Dr Giles as to their estimate of the "percentage" of "a most severe case" that the various injuries represented. 58 The psychologist retained by the Plaintiff, Mr Borenstein, noted that the Plaintiff had made what he described as "a relative, and somewhat miraculous speedy recovery" due in part to the intervention of a new product which prevented skin grafts, a matter spoken of by the Plaintiff. Having had the opportunity of observing the Plaintiff in the witness box and noting the injuries he demonstrated there, and generally accepting his account of the extent of discomfort and the progress of his recovery from injury, it is indeed miraculous that the Plaintiff was neither killed nor more severely and permanently injured than the serious injuries that he in fact suffered. Mr Borenstein was of the view that the Plaintiff as a result of the accident had a "tendency" towards a moderate level of anxiety and the Plaintiff particularly was anxious about returning to the plumbing industry in light of his suffering. He had suffered a significant sense of loss arising out of life style changes and to some extent a degree of depression, described as "mild to moderate", compensated by a considerable increase of alcohol. He was anxious about having to make life style changes and felt somewhat let down by his misfortune, having to "redefine" his life. Mr Borenstein was of the view that the Plaintiff, as at May 2004, was suffering an Adjustment Disorder with Mixed Anxiety and Depressed Mood consequent upon his injuries. Mr Borenstein was concerned that the Plaintiff may have in fact minimised the psychological reaction he was suffering, seeking to brush it aside and being unable to express his feelings freely. He gave this impression to me when giving evidence. The episode still haunts him I believe. His understated emotion when describing how he was injured and its sequelae was genuine in my view. Mr Borenstein was impressed with the Plaintiff's capacity to make adjustments in his life to meet his new situation and that he would need future counselling. He was concerned also about the suffering of his family seeing him in such a serious condition and having to deal with his recovery. He recommended 12 sessions for future treatment. 59 Another psychologist, Dr Skinner, for the Fourth Defendant, noted the Plaintiff's remarkable physical recovery and what she describes as "remarkable recovery … psychologically". She did not think that he was, as at September 2005, suffering from any "psychiatric disorder or psychological condition" and felt there was no need for "psychological treatment". She noted however, that Mr Hubbard had suffered a severe injury and future opportunities may be restricted because of his physical injuries. As is self evident from the detail of his injuries in the hospital notes and the various medical reports she noted the burn injuries were "extremely painful" and that he was continuing to suffer physical restrictions upon his activities as well as physical discomfort, but that he had a "Stoic approach (sic)" to his injuries and that persons with such an outlook, who deal with their emotions (as Mr Borenstein observed) by degree of denial and suppression usually do better from a psychological perspective because of these coping mechanisms. I believe that he still needs some future counselling, but not intensive, given his obvious mental strength and resolve. 60 All of the medical practitioners and other persons who have examined the Plaintiff have noted his cooperation, openness, lack of exaggeration and consistency in account. Dr Ryan, for the Fourth Defendant, noted that there was no element of mendacity, inconsistency or exaggeration at the time of examination. This was at "2 July 2005", although the report being dated 23 June 2005, I assume this means 2 June 2005. 61 To summarise the situation, the Plaintiff suffered very significant injury which must have caused considerable pain and discomfort both immediately and thereinafter for an extended period of time, beyond discharge from hospital. Such was the pain immediately after the explosion that the Plaintiff had to be placed in an induced coma. There was subsequently, for a period of about three months, severe or significant limitation upon the Plaintiff's capacity to move physically and care for himself. There has been improvement over a period of time. He was very dependant upon his mother for personal assistance on discharge from hospital and, in the first three months, in all manner of personal tasks from going to the toilet, bathing, dressing, changing dressings, provision of meals, transport to frequent medical appointments at Concord (which required some hours of travel from the Sutherland Shire and waiting) and other tasks. Although his mother had cooked meals, and washed clothes for him before the injuries, unpaid assistance increased enormously afterwards. I accept that this assistance averaged about 20 hours a week for the first three months and about 10 hours or slightly less for the following three months and slightly beyond diminishing over time, although he was becoming much more independent by late April, or early May. Although more physically active by four months after the explosion, there were considerable limitations cast upon the Plaintiff which he tried to push aside to assert his independence because, simply put, he was no malingerer, desperate to kick start his life and interests if that was physically possible. After 3 months pain was limited. The Plaintiff commenced some physical exercise of a limited nature, but had to as he said he lost 20 kgs in hospital. By late April 2002 he was not fully independent in care of himself. He told examiners on 30 April 2002 and shortly afterward of his great improvement, but he was not the sort of person to "whinge" and was anxious to get on with his life. There remains continuing discomfort (albeit comparatively minor) and limitation upon the Plaintiff's capacity to undertake physical exertions of which he was capable prior to the accident, particularly because of his susceptibility to trauma, sensitivity to sun damage and skin sensitivity to particular chemicals that did not exist before. There is little suggestion, in examination out of Court and in my view in his evidence in Court, of any exaggeration of the extent of his injuries, symptoms suffered as a consequence of his injuries, the development of his recovery or his current condition. I accept on the evidence available to me that whilst he made what could best be described as spectacular progress in his rehabilitation, this occurred over a number of months and the rehabilitation process was a painful, demanding affair. 62 The consequences of his injuries have relevance not only to assessing any potential economic loss, but also assessing non economic loss, insofar as the injuries have impacted upon his quality and enjoyment of life and related matters. "Non Economic Loss" means any one or more of "pain and suffering, loss of amenities of life, loss of expectation of life and disfigurement" (s.3 Civil Liability Act 2002). In relation to these matters, there was little dispute in the evidence and, in any event, so far as explaining the effects upon him of his injuries, the Plaintiff's evidence on this issue was, to my mind, untainted by exaggeration, hyperbole or untruthfulness. I accept that prior to the accident the Plaintiff was, at the very least, a competent tradesperson with expectations of a career in plumbing which can be a very lucrative occupation, particularly if the Plaintiff had the opportunity of starting up his own business. He had an interest in sport, having played as a child and young adult cricket and soccer, although ultimately his involvement in these sports would appear to have fallen away largely prior to the accident. I accept however that his ability to participate in these sports on a social basis, which would add to the enjoyment of his life, is severely affected given his susceptibility to injury to the affected areas and the susceptibility to damage from exposure to the elements, particularly the sun. He was an exceptional body board rider and there is evidence from him, in articles produced to the Court and other objects (including a T-shirt) that he was highly competitive in this area of activity as a teenager. In fact he had been involved in the international "Pro Circuit" in his mid to late teens, such as it was, some years before the accident. His father conducted business manufacturing body boards and related equipment. I conclude however, that notwithstanding the fact that this particular activity was his main sporting interest, his potential to pursue a career in it had diminished prior to the accident. The material before me shows that he was at his peak in this sport some years before his injuries and that his involvement in this activity had moved, up until late 2001, from the competitive to largely the recreational. The truth of the matter however, for aficionados of surfing in its various forms, is that this recreation gives enormous enjoyment and pleasure, as well as peace of mind. Even if it be said that the Plaintiff's interest or capacity to compete in body boarding competitions had diminished or disappeared, it is a sport that could be undertaken recreationally by him for many years in the future, but for his injuries, and as frequently as opportunity allowed. The primary effect of his injuries on this recreation is that because he must limit his exposure to the sun, his opportunity to participate in this recreation is restricted. Practically all of the "Particulars of Disabilities (sic)" are made out to varying extent, although the claimed psychological damage is ultimately limited and diminishing. 63 The Plaintiff prior to his injuries had a long standing interest in music. His mother was a music teacher. He had an interest in "hip hop", "R & B" (rhythm and blues) and other forms of modern music. He gave evidence of developing an interest in recording music, by use of a home studio that had been provided to him by his parents with a gift of about $15,000 after his accident. It would seem, drawing a reasonable inference from the available evidence, that it was provided to him as an interest during those many months that he was unable to work and was denied opportunity to go out and enjoy himself outside the house, either by reason of his medical appointments or the limitations of his injuries. The "studio" was in place approximately 3 months after discharge. Whilst he was anxious to develop his music production facility to achieve commercial outcomes and whilst it provided him with enjoyment and a real interest, ultimately commercial viability was not achieved. As he has slowly moved back into the work force his occupation with this interest had diminished. I accept it was a serious exercise in the beginning and he was ambitious to achieve high financial return. Ultimately this did not occur. 64 By March 2003 he was fit enough to undertake part time casual work at the Taren Point Bowling Club. He also did some work for his parents for which he was paid pocket money up until that period of time. He obtained casual work for two weeks at the Royal Easter Show of 2003 for which he was well paid. I do not believe for one moment that the Plaintiff delayed his return to the workforce or used his injuries as an excuse to avoid obtaining employment that may have been available to him. The truth was that it really took over a year for him to recover both physically and mentally to the point where he could participate in employment without risking further injury, albeit that he obviously could not immediately return to plumbing which is a very physical profession where given the site of his burns injuries, the risk of skin damage from sun or trauma have been very great. 65 Whilst at the Taren Point Bowling Club he worked between 10 and 30 hours per week and was paid $16 an hour and pursued that work for approximately 15 months. He started working in outside conditions in June 2004 doing labouring work at Kurnell Refinery and later in 2004 began working for a local plumbing business (that is local to the Sutherland Shire) where he earned $750.00 nett per week although he had to take every protection when required to work outside which was the majority of the time. He held that employment at Kurnell for a month and then he obtained employment maintaining water meters which involved mainly work outside, again having to maximise his protection from the sun. He worked for that business for seven months earning approximately $630.00 nett per week. However, in April 2005 he lost his drivers licence for some months in circumstances that are irrelevant and he had to give up that work. He obtained work with another plumbing company performing labouring work in late 2005 however, the work was casual and spasmodic and he was paid a casual rate of $25.00 per hour. In February 2006 he obtained a position with a Miranda plumbing company, working three to four days a week approximately eight hours a day and having a base hourly rate of $20.00 per hour. In July 2006 he obtained another position in plumbing with a Redfern based business, again that work is relatively casual in nature and certainly does not involve "full time" employment. It would seem, particularly since mid 2004, that most of the Plaintiff's employment circumstances have been dictated by factors disconnected to the circumstances of his injuries, such as the loss of licence, the character of the retainer and the availability of work. On the other hand the sensitivity of his skin to injury and damage by trauma or the elements is a permanent feature of his life and if it does not significantly inhibit him, it certainly requires him to be particularly cautious and conservative in order to minimise the risk of any such injury. 66 On the evidence it was submitted by Counsel for the Plaintiff that if an award for the damages was to be made in relation to loss of future income, consequent upon the Defendant's negligence, the payment should be in the character of a "cushion" amount, with which proposition there was little disagreement and which in the circumstances of the matter appears eminently reasonable. Further, when one takes into account his position immediately before injury, in the context of his potential as he gained more experience to obtain more and more work to be better renumerated than his was by Mr Wells, and give consideration to conduct his own business (although this matter is not obviously a significant factor in the case) the buffer or cushion claim of the Plaintiff, given the interruption to his capacity to work as a plumber, is relatively modest. The claim for past economic loss is somewhat optimistic in its detail of lost income, judging from the record of income up until 18 December 2001. I will deal with these matters shortly. The Cross Claim 67 In light of the above findings the Cross Claimant succeeds, as against the Cross Defendant, in his claim for indemnity for damages and costs in respect of the policy of liability insurance described as a "Commercial Plan Insurance Cover", which was current at the time the Plaintiff was injured. The policy had a provision for the Cross Defendant to insure the Cross Claimant against legal liability to pay compensation for personal injury as well as pay the reasonable legal costs incurred in defending or settling the claim. The Cross Defendant admits the currency of the policy, but it does not admit the allegations as set out at paragraph 3(d) of the Cross Claim. As the matter has been conducted, if the claim that the Plaintiff was a contractor and not an employee succeeded, there was no serious submission put that the terms of the policy did not cover the situation pleaded by the Plaintiff. 68 The "Business Liability Policy" which states the terms of insurance cover provided indemnity, in its terms, for legal liability to pay compensation and costs for personal injury suffered by others, who were not employees, "in connection with the business" of Mr Wells, which was "Plumber/Gasfitter". These terms are set out in the "Commercial Plan". 69 There are exemptions to the policy, but none were directly relevant to the circumstances in which the Plaintiff was injured and how he was retained. Although there was an alternative case pleaded by the Cross Claimant, that does not arise in light of the above findings. Assessment of Damages Non Economic Loss 70 I am required to assess the non economic loss in accordance with the provisions of the Civil Liability Act, to which earlier reference has been made. In the context of the earlier findings I have made concerning the extent of injuries and the effect of that upon the life of the Plaintiff, as well as the pain and suffering suffered by the Plaintiff, which in the early stages was clearly intense, I have concluded that the global situation permits a finding that this matter is one where the Plaintiff's non economic loss should be assessed at 25% severity of a most extreme case, although I note that this component does not include any consideration, in the conventional sense, of "loss of expectation of life". That amount is on the current schedule $28,000. Past Economic Loss 71 The parties who have most closely submitted upon this topic have been the Plaintiff and the Cross Defendant. The particulars claimed by the Plaintiff are set out in the Schedule which is MFI 9. In summary for the balance of the tax year 2002 the Plaintiff claims $14,000, for the year 2003 $31,200, for 2004 $36,400 and for 2005 to date $99,200. The total of $180,800 is diminished by actual earnings of $81,108. 72 The predictions of economic loss over this period of time by the Plaintiff, as I previously observed, are "optimistic". On the evidence of earnings up until 18 September, even if the Plaintiff only worked for Mr Wells, I do not believe that the would have earned $500 per week, for every week of that year. He was not working five days a week in the six or seven weeks before the accident. One could not be entirely precise in one's calculation of past economic loss for any of the years in any event, even allowing for the evidence of payments made on return to employment in 2003 and particularly plumbing type employment in 2004. There is no doubt however, that putting aside the period when the Plaintiff could not work (between 18 December 2001 and March 2003), the Plaintiff's earning capacity has been diminished although increasingly less so particularly in the last two years. In respect of the sums claimed by the Plaintiff in the Schedule, whilst I accept they represent increments with greater skill and experience, which probably would have been earned, they also assume maximum opportunity to work, which may not have necessarily arisen. Ultimately, I propose in this respect to award a sum, taking into account actual earnings since injury as calculated and not disputed, based upon the following assessments: 73 For tax year 2002, $10,000; for tax year 2003, $24,000 (40 weeks x $600); for 2004, $28,000 (40 weeks x $700); for tax years 2005, 2006, $68,900 (92 weeks x $750) and for tax year 2007 to date $20,800 (26 weeks x $800). This represents a total of $151,700. The figure of $800, should be considered in light of the casual rate of $160 a day, or $800 a week, struck with Mr Wells in early 2001, the other figures have regard to past earnings during the relevant tax years. 74 It should be noted for example, by reference to the claim, it is likely the Plaintiff would not have been able to work as a plumber during the period of time he was disqualified from driving, which in my view is a reasonable conclusion given the events revealed in the past. I appreciate, of course, I may be under estimating the opportunities of the Plaintiff to obtain work, particularly bearing in mind that his capacity to obtain experience was severely interrupted because of this affair, as was any opportunity he may have had (which is, I appreciate, not directly the subject of evidence), to go into a business for himself when he was suitably qualified. This may be counter balanced by the assumption of increased earnings with increased skill. I have assumed some gaps between "employment" opportunities. Although this may be unfair my assessment assumes that his injuries have in the past caused greater dislocation to those opportunities from 2004 to present than would have been the case otherwise. Thus on my calculation the total nett payment for past economic loss is $60,892. The Cross Defendant in fact submitted that an appropriate cushion payment would be about $50,000. I will need assistance as to the calculation of the relevant figure for the purposes of judgment. Fox v Wood 75 The Plaintiff, notwithstanding the objection of the Cross Defendant, has persuaded me that it is appropriate, on the information provide by the Bar table by Mr Toomey, to make allowance for such a component, recognising tax payable upon workers compensation payments, in the award of damages in the sum of $4,500 as claimed. Without evidence I will assume that his calculation is correct unless specific information to the contrary is provided before final judgment is entered. Past Out of Pockets 76 The past out of pockets of the Plaintiff are agreed at $30,544.89. Gratuitous attendant care services (s.15 Civil Liability Act 2002) 77 A claim is made for the assistance provided to the Plaintiff by his mother for the first six months after his release from hospital. S.15(3) is satisfied. As I earlier indicated, I was impressed with the honesty of the Plaintiff in a range of ways and particularly in relation to matters such as the detail of his injuries and the assistance obtained from his family and particularly his mother. Given the character of the injuries and his dependence upon his mother for transport to medical appointments and the intense assistance he would have needed for changing of bandages in the early months of recovery and the like, and the fact that the calculations accord with the evidence I would allow the full sum claimed by the Plaintiff at $8,292. Future Economic Loss 78 Finally, in relation to future economic loss including future out of pocket expenses, the claims made by the Plaintiff are again relatively modest. Clearly cushion awards are appropriate given some of the imponderables. Again predicting the future is difficult, however given the restrictions upon the Plaintiff's capacity to work outdoors, concern that he will have for the rest of his life about injuring sensitive areas, such as his hands which clearly in the plumbing industry would be at risk from time to time and that his restrictions upon working outside and the like affect his employability I would allow the sum of $25,000, (slightly less than that claimed) and the full amount of future out of pocket expenses, $2,500, which in all the circumstances appears reasonable, allowing for expenses for skin protection over his lifetime and some counselling. 79 The total of damages that I therefore calculate to be awarded is: Non Economic Loss $28,000.00 (25% of a most extreme case) Past Economic Loss $151,700.00 - less actual earnings $81,108.00 Fox v Wood $4,500.00 Past Out of Pockets $30,544.89 s.15 Civil Liability Act $8,292.00 gratuitous attendant services Future Economic Loss $25,000.00 Future Out of Pockets $2,500.00 Interest $4,956.00 Total $174,119.89 Orders 80 I make the following orders: 1. Verdict and judgment for the Plaintiff, against the First Defendant, in the sum of $174,119.89. 2. The First Defendant to pay the Plaintiff's costs as assessed on the ordinary basis up until and including 4 November 2005 and as assessed on an indemnity basis thereinafter. First Cross Claim 1. Verdict and judgment for the First Cross Claimant in terms of paragraphs (a) and (b) of the relief claimed in the First Cross Claim. 2. The Cross Defendant to pay the First Cross Claimant's costs as agreed between the parties, including costs of the Plaintiff in the proceedings. 3. Liberty for the parties to apply within 14 days. ********** 13/10/2008 - Amendment to case title due to database not recognising the character "/". - Paragraph(s) Case title DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. 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