New South Wales Supreme Court CITATION : Van Opstal v Australian Iron & Steel Pty Limited (No. 2) [2000] NSWSC 1125 CURRENT JURISDICTION: Common Law Division FILE NUMBER(S) : SC W 200110/96 HEARING DATE(S) : 5 December 2000 JUDGMENT DATE : 5 December 2000 PARTIES : Peter Van Opstal (Plaintiff) Australian Iron & Steel Pty Limited (Defendant) JUDGMENT OF : Dunford J COUNSEL : B Ingram (Plaintiff) EG Romaniuk (Defendant) SOLICITORS : Maguire & McInerney (Plaintiff) Sparke Helmore (Defendant) CATCHWORDS : NEGLIGENCE - personal injury - damages - whether interest payable LEGISLATION CITED : Workers Compensation Act 1987, s 151M(4) DECISION : Interest allowed; judgment for plaintiff in the sum of $642,561 THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION DUNFORD J Tuesday, 5 DECEMBER 2000 W 200110/96 PETER VAN OPSTAL v AUSTRALIAN IRON & STEEL PTY LIMITED (No. 2) JUDGMENT 1 HIS HONOUR: I delivered judgment in this matter on 24 November last [2000] NSWSC 1082, but stood over the questions of interest, costs, the amount of workers compensation paid and the tax thereon. 2 It is agreed that the amount of workers compensation that has been paid to the plaintiff in respect of the injuries the subject of these proceedings is $52,878, and that there is no change from the amount I allowed in respect of the tax paid on workers compensation. There is also no dispute as to the appropriate order that should be made for costs, and the only remaining question is that of interest, which is relevant only to the amount allowed for loss of income to date. 3 Section 151M of the Workers Compensation Act 1987 limits the circumstances in which interest can be awarded and the relevant provision for present purposes is subs (4)(a)(iii) which is as follows: "Interest is not payable (and a court cannot order the payment of interest) on such damages unless: . . . (iii) the defendant has made an offer of settlement, the amount of all damages of any kind awarded by the court (without the addition of any interest) is more than 20% higher than the highest amount offered by the defendant and the highest amount is unreasonable having regard to the information available to the defendant when the offer was made." 4 In the present case the matter was first listed in the circuit sittings at Wollongong in 1997 when it was not reached. It was also not reached in 1998 and 1999. In 1997 the defendant made an offer of $150,000 clear of workers compensation payments plus costs of which $60,000 related to the plaintiff's back injury, which injury formed no part of the plaintiff's claim in the present proceedings. The plaintiff's position at that stage was that he would accept $380,000 on the same basis. There were no further meaningful negotiations during 1998 and 1999. 5 On the second day of the trial, 18 July 2000, an offer was made by the defendant by a Calderbank letter to settle the matter for $350,000 clear of compensation plus costs. This offer related only to the plaintiff's neck injury, the subject of the proceedings. 6 No further offers were made and the relevant issue is therefore whether that offer was unreasonable having regard to the information available to the defendant when it was made. There is no dispute that proper and adequate particulars had been supplied and the relevant plaintiff's medical reports had been served such as to enable the defendant to make a proper assessment. 7 The workers compensation paid to the plaintiff at that stage was approximately $50,000 so the defendant's offer was in effect an offer of $400,000 plus costs for the neck injury only. Without interest the plaintiff has recovered a judgment of $652,980 which is more than 50% in excess of the effective value of the defendant's offer. I would, prima facie, regard such an offer as unreasonable in all the circumstances. 8 On behalf of the defendant it has been submitted that at the time of the offer the defendant had access to the videos which were shown at the trial and evidence on which the plaintiff was cross-examined to the effect that he had changed a gear box; but the main issue in the trial on the question of damages was whether the plaintiff had any residual earning capacity, and as I found in my judgment, that does not depend only on the plaintiff's activities as shown on a video, and if the defendant made its assessment of such future earning capacity based wholly or substantially on what was shown on the video, it was in error in so doing. 9 It was submitted that the scheme of s 151M is to limit payments of interest to circumstances where it is appropriate to punish the defendant for unreasonable conduct. I do not read such an object into the Act. The principles on which interest have traditionally been awarded are that the plaintiff has been deprived of money to which he or she has been entitled for a period of time, and in the meantime the defendant has had the use of such money. 10 Section 151M in my view does not depart from that principle, but merely limits its application and, as I say, where the plaintiff has recovered more than 50 per cent in excess of the offer, I have difficulty in regarding the offer as reasonable. 11 There may be a moral here that defendants should make more generous offers earlier in proceedings; if they don't and retain the use of their money in the meantime, it can be expected that, subject to the outcome of the proceedings, they will be held liable to pay interest. In my opinion this is an appropriate case to order an award of interest. 12 The amount of interest has been agreed at $42,459 which, when added to the amount of damages detailed in my judgment of $652,980, comes to a total of $695,439. From this amount there must be deducted the amount of workers compensation already paid to the plaintiff, namely $52,878 leaving a net amount of $642,561. 13 I therefore direct the entry of judgment for the plaintiff in the sum of $642,561 and I order the defendant to pay the plaintiff's costs of the proceedings. 14 I grant a stay of proceedings for 28 days on condition that within that time the defendant pays to the plaintiff $400,000 on account of the judgment, and otherwise usual terms. 15 The order for costs to be payable forthwith. oOo Last Modified: 12/19/2000 DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.