New South Wales Supreme Court CITATION : Sanders v Commonwealth of Australia [2006] NSWSC 574 HEARING DATE(S) : 8/6/06, 9/6/06 JUDGMENT DATE : 6 July 2006 JUDGMENT OF : Bell J at 1 DECISION : Pursuant to s 60G(2) of the Limitation Act 1969 (NSW) the limitation period for the cause of action in this proceeding extended to the date on which the statement of claim was filed. CATCHWORDS : Application for extension of the limitation period - psychiatric injury arising out of the Melbourne/Voyager collision LEGISLATION CITED : Limitation Act 1969 Blyth v Commonwealth [2005] NSWSC 721 Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541 CASES CITED : Commonwealth v Diston [2003] NSWCA 51 Commonwealth of Australia v Smith [2005] NSWCA 478 Holt v Wynter (2000) 49 NSWLR 128 McClean v Sydney Water Corp [2001] NSWCA 122 PARTIES : Ken Steven Sanders (Applicant) Commonwealth of Australia (Respondent) FILE NUMBER(S) : SC 20123/02 COUNSEL : D Priestley (Applicant) P Jones / I McLachlan (Respondent) SOLICITORS : Hollows Solicitors (Applicant) Australian Government Solicitors (Respondent) IN THE SUPREME COURT OF NEW SOUTH WALES COMMON LAW DIVISION BELL J Thursday 6 July 2006 20123/02 Ken Steven Sanders v Commonwealth of Australia JUDGMENT 1 BELL J: This is an application, brought pursuant to s 60G of the Limitation Act 1969 (the Act), that the limitation period for the applicant's cause of action pleaded in his statement of claim filed on 5 April 2002 be extended for such period as the Court determines. The notice of motion claiming the order was filed on the same day as the statement of claim. 2 The applicant was a naval rating on board HMAS Melbourne on 10 February 1964 when it collided with HMAS Voyager. The applicant's cause of action is pleaded in negligence. He claims to have suffered psychiatric injury as the result of his experience of the collision. 3 The applicant was born on 27 October 1931. The limitation period for his cause of action expired on 11 February 1970. 4 The applicant pleads the following particulars of injury: (a) Severe shock; (b) severe anxiety and depression; (c) panic attacks; (d) sleeping disturbances and recurring nightmares; (e) difficulties with sleeping, nightmares and flashbacks; (f) irritability and fatigue; (g) night sweats; (h) difficulty in concentrating, making decisions and solving problems; (i) mood swings, frustration and isolation; (j) post-traumatic stress disorder with numerous re-experiencing symptoms, avoidance symptoms and arousal symptoms; (k) emotional detachment, insecurity and lack of confidence; (l) attempts to medicate himself by heavy use of alcohol with consequential impairment of body function; (m) fear of the sea; (n) crying fits; (o) ulceration; (p) acid reflux; (q) cigarette addiction to 1992 with consequential impairment of body function; (r) anxiety disorder; (s) generalised anxiety disorder; (t) adjustment disorder; (u) heart condition. 5 The applicant's claim for damages includes a claim for economic loss, it being his case that his psychiatric injury has impaired his capacity to earn income. He pleads that had the collision not occurred it is likely that he would have attained the rank of commissioned officer and retired at or around the age of 55 years, having qualified for a Defence Force Retirement Benefit pension and other entitlements. 6 Section 60G(2) of the Limitation Act provides: If an application for an order under this section is made to a court by a person claiming to have a cause of action to which this section applies, the court, after hearing such of the persons likely to be affected by the application as it sees fit, may, if it decides that it is just and reasonable to do so, order that the limitation period for the cause of action be extended for such period as it determines. 7 The applicant bears the onus of demonstrating that it is just and reasonable for the Court to order that the limitation period for his cause of action be extended. Before the Court may give consideration to this question, it is necessary for the applicant to pass the threshold test posed by s 60I(1) of the Act, which provides: (1) A court may not make an order under section 60G or 60H unless it is satisfied that: (a) the plaintiff: (i) did not know that personal injury had been suffered or (ii) was unaware of the nature or extent of personal injury suffered, or (iii) was unaware of the connection between the personal injury and the defendant's act or omission at the expiration of the relevant limitation period or at a time before that expiration when proceedings might reasonably have been instituted, and (b) the application is made within 3 years after the plaintiff became aware (or ought to have become aware) of all 3 matters listed in paragraph (a)(i)-(iii). 8 "Personal injury" is defined in s 11 of the Act to include any impairment of the physical or mental condition of a person. 9 The applicant swore an affidavit in support of his application on 7 September 2002. He describes an unremarkable childhood. He obtained his Leaving Certificate in 1948. He completed a course at the Sydney Teacher's College in 1950. Thereafter he worked as a schoolteacher for a number of years. He says that he had always wanted to join the Royal Australian Navy (the Navy) but that his parents had been opposed to this course. At the age of 23 years he applied to join the Navy. 10 On 6 December 1954 the applicant enlisted in the Navy for a term of six years. He recalls that this was the maximum term open to new recruits. It was his intention to make his career in the Navy. He underwent his initial training at HMAS Cerberus as a Writer, which was the classification for ratings performing clerical duties. 11 The applicant's first sea posting was to the crew of the Voyager. He remained a member of her company until November 1957. At this time he was promoted to the rank of Leading Writer. Thereafter he was posted to a number of shore establishments. In October 1960 he returned to sea duties on the Melbourne as a Writer attached to the Admiral's staff. 12 In December 1960 the applicant re-enlisted for a further term of six years, which he understood to be the maximum term that was open to him. 13 The applicant was attached to the Admiral's staff on board the Melbourne at the date of the collision. At the time of the collision he was off-duty and standing on the radar deck. This was a deck located on the top of the island, a structure located on one side of the flight deck. The radar deck was some 50 to 60 feet above the flight deck and it provided a vantage point from which to watch aircraft performing "touch and go" flying exercises. There were no exercises underway at the time of the collision. The applicant says that he had gone up to the radar deck to find his friend, Brian Parke who had earlier agreed to get him a drink. The applicant was able to see the Voyager on the Melbourne's forward starboard quarter. He saw her turn to port and he assumed that she was moving to resume "flying stations" on the Melbourne's aft port side. As he watched, he saw her coming towards the Melbourne. He says that he has re-lived the next minute as if it were a slow motion replay continuously since that time. As the Voyager slipped underneath the bow of the Melbourne he recalls seeing an enormous flash of fire. At first he thought the Voyager might have only been scraped by the Melbourne's bow, but then he saw the forecastle passing down the Melbourne's port side and he knew that a terrible tragedy had occurred. 14 The applicant recalls that he raced down from the radar deck to his damage control station, which was located five decks below the flight deck. By this time "Damage Control State Zulu" had been announced. This announcement required that every compartment on the ship be sealed off to provide maximum watertight integrity. The announcement led the applicant to believe that the Melbourne had suffered severe damage and must be in danger of sinking. He was anxious that he was not at his damage control station. At the time of swearing his affidavit the applicant stated that he had seen the statement that he prepared for submission to the Royal Commission into the causes of the collision, in which he said that he was in the ladder bay in the period following the collision. He did not recall being in the ladder bay or making the statement for the Royal Commission. His first recall he believes is of events some two hours after the collision, when he and Brian Parke were in the hangar deck obtaining particulars, including the names and details of the next of kin, of the survivors from the Voyager. 15 The applicant was on duty in the week following the collision attending to a large amount of correspondence. On 20 February 1964, he was handed a signal, which informed him that he had been discharged UFTRO (Unfit For The Rating Of). He was discharged from the Navy with immediate effect. In his affidavit he describes mixed emotions on receiving this news. He says that he was still traumatised by the collision and he recalls feeling relief at being removed from reminders of it. However, principally he says that he recalls being devastated and astonished at the suddenness of his discharge. 16 The applicant was not given an explanation for his sudden discharge. He assumed it was because he was homosexual. There had been an incident in Green Park, Sydney (which in his affidavit he recollected as occurring in January 1963, but which he acknowledged appears to have happened in January 1964) in which he had been charged with indecent exposure. There were some other incidents associated with his sexual orientation that appear to have brought him to the notice of the naval authorities. In his affidavit the applicant asserted his belief that had he not been so affected by the collision he would have gone to his divisional officer on receipt of the signal and protested his treatment. In oral evidence he explained that had it not been for the collision he expected that he would have sought some explanation from his divisional officer, but he was not asserting that he would have challenged the Naval Board's determination. I understood the applicant to frankly acknowledge that in 1964 it would not have occurred to him to pursue a challenge to the Naval Board's decision to discharge him in the circumstances as he understood them to be. 17 The applicant was awarded good conduct badges after four years' and eight years' service. His conduct throughout his naval service was rated as "very good" and his efficiency as, at least, "satisfactory"; his final efficiency rating was "superior". 18 The applicant says that he was an accomplished clerk with a typing speed of 90 words per minute. After his discharge he sought, and promptly obtained, employment. He details his employment history in his affidavit. This included working for a number of years as a telephonist/typist with a firm of smash repairers. Subsequently he worked for some years as a paymaster. In 1977 he moved to the Gold Coast where he obtained employment as a night porter with the Chevron hotel and later with the Iluka Quality Inn. In 1982 he started working as a cleaner at a shopping centre. He worked in this capacity for the next six years. In 1988 he started working as a cleaner with the Gold Coast City Council and he remained in this employ until his retirement on 1 July 1997. 19 The applicant identifies the names and dates of employment of each of his employers since the date of his discharge from the Navy. It appears that he has always been able to obtain and maintain employment. It is his case that for a substantial period of his working life he has worked in unskilled positions, which have not been equal to his capacity. In oral evidence he said that he found that working with others was a source of stress and that he had a preference for jobs in which he was able to work by himself or with one or two others. His asserted inability to handle stressful work environments is said to be a feature of his psychiatric condition 20 The applicant also claims to have suffered from alcohol abuse as the result of his experience of the collision. He says that he was a moderate drinker prior to the collision. Since that time he has been plagued by memories of it, which have made it difficult for him to sleep. He found that alcohol helped to settle him. He says that he graduated from drinking a few beers to heavy drinking and that at the date of swearing his affidavit he was drinking a cask of wine and a bottle of whiskey at least weekly. 21 In his affidavit and in oral evidence the applicant described having nightmares and sleep difficulties from the date of the collision and continuing. 22 Shortly after leaving the Navy the applicant formed a relationship with a man named Roy. They lived together from 1964 until Roy's death in 1998. In the early years of the relationship Roy was employed at the Tooheys Brewery. The applicant acknowledged in oral evidence that Roy was a heavy drinker and that the two of them had enjoyed an active social life. 23 In his affidavit the applicant described himself as a person who could not tolerate being around people and who preferred to be on his own as much as possible or, at most, in the company of a couple of friends. He says that he has suffered from panic attacks when away from home. He describes feelings of irritability and occasional outbursts of temper. He states that he did not connect these manifestations with his experience of the collision until more recent events. Prior to April 2000 he did not believe that he suffered from a psychiatric illness. 24 After Roy's death the applicant joined the Naval Association and the Far East Strategic Reserve Association. He attended a reunion run by the latter Association held on the Easter weekend in 2000. At this event there was some discussion about the collision, which the applicant found distressing. It was suggested to him that he should undergo counselling. An Advocate with the Department of Veterans' Affairs, arranged to put in a claim on the applicant's behalf to the Military Compensation and Rehabilitation Scheme. Following this the applicant made contact with Hollows Lawyers. He was referred to Dr Rosalie Troup, a psychiatrist. He attended four consultations with Dr Troup. She was the first person to tell him that he was suffering from post-traumatic stress disorder (PTSD). 25 Annexed to the applicant's first affidavit is the report of Dr Troup, dated 30 August 2001, addressed to the Military Compensation & Rehabilitation Service of the Department of Veterans' Affairs. In her report Dr Troup expresses the opinion that the applicant has a chronic PTSD and a substance dependence, which escalated after the collision and has continued since. 26 Also annexed to the applicant's first affidavit is a report of Dr Hopwood, a consultant psychiatrist, dated 16 May 2002. This report was prepared at the request of the applicant's solicitors. Dr Hopwood reports that the history of symptoms that he obtained was consistent with a diagnosis of PTSD and that the diagnosis was confirmed with the use of the structured interview technique. Dr Hopwood is of the opinion that the applicant has met the criteria for the diagnosis of PTSD from 1964 until the date of his report and that his symptoms appear to have undergone little amelioration over that time. In his opinion the applicant remains mildly to moderately disabled by his symptoms. Dr Hopwood considered there was sufficient evidence to warrant the current diagnosis of alcohol dependence and he suspected that the applicant might have met the criteria for this diagnosis for the majority of time since his discharge from the Navy. 27 Counsel for the respondent submitted that the applicant had failed to satisfy the threshold requirements of s 60I(1)(a)(i) – (iii). In his submission the applicant was aware that he had suffered an impairment of his mental condition as the result of the collision from a time shortly after it. Counsel relied on the applicant's evidence in cross-examination (at T 38-39): Q. Now, in terms of those problems are they problems which you started to notice shortly after the collision? A. Yes sir. Q. And to your mind did you appear to be reacting differently after the collision compared to before the collision? A. Yes sir. Q. And was it the situation that looking at how you were reacting you thought that more likely than not it had something to do with the experience you had been through in the collision? A. At the time I realised that I found it difficult to work with large groups of people as I was at Sundell Motors, handling contact with customers, the public. I just accepted it as the way I felt and I needed to get out and that is why I sought the type of job I then moved into as pay clerk, paymaster in whatever you call it in an ordinary office environment where I was doing my job without reacting with the general group of employees. … Q. Well, did you not say to yourself that you felt different after the collision compared to before the collision? A. No I didn't say it to myself, sir. I just accepted that was the way I was. Q. As I understand your evidence, correct me if I am wrong, it is to the effect that you are travelling along quite satisfactorily up until the time of the collision and then you encountered differences in your personality straight away. That's right, isn't it? A. Almost straightaway, yes, sir. Not immediately ten seconds after the collision. But yes, within the next weeks, yes. Q. In your own mind if you had had a very unpleasant event, like being involved in a naval collision in the middle of the ocean and you then noticed these changes within weeks, wouldn't you have related to those changes to the event? A. Yes I did but I didn't understand why (T 38-39). 28 The applicant's acknowledgment that he was aware that he reacted to events differently after the collision and of his realisation that he had difficulty working with large groups of people did not amount to an acknowledgment that he understood these changes were the manifestation of a recognisable psychiatric illness: Commonwealth of Australia v Smith [2005] NSWCA 478 per Handley JA at [7], Santow JA at [104] and Basten JA at [181]. 29 I am satisfied that the applicant did not know that he had suffered a psychiatric injury until he consulted Dr Troup and learned of her diagnosis around August 2001. 30 The respondent did not address submissions to whether the applicant ought to have become aware of the three matters in s 60I(1)(a) (i) to (iii) at a time more than three years prior to making the application. The applicant said that he had "accepted that was the way I was" (T 39). By this I understood him to be saying that before he saw Dr Troup he understood that his symptoms were features of his personality. 31 In her report Dr Troup observed that: Mr Sanders has had all the symptoms of Post Traumatic Stress Disorder but has denied it, as many veterans do, to himself although the evidence was there. 32 Dr Hopwood reports: It is clear that Mr Sanders has had great difficulties "coming to terms" with the traumatic incident outlined above. Highly consistent with the diagnosis of chronic Post Traumatic Stress Disorder he has avoided any in depth discussions or reminders related to the incident until the last few years. It is very common for this avoidance, which is an essential part of the diagnosis of Post Traumatic Stress Disorder, to lead to long delays in seeking treatment assistance. 33 I am satisfied that the application was made within three years of the applicant becoming aware of his psychiatric illness and I do not consider that he ought to have become aware of it at a time earlier than August 2001, when he spoke with Dr Troup. 34 I turn now to a consideration of whether it is just and reasonable to order that the limitation period be extended. Leave will not be granted under s 60G(2) if to do so would occasion significant prejudice to the respondent. Significant prejudice is prejudice that would make the chances of a fair trial unlikely: Holt v Wynter (2000) 49 NSWLR 128; Commonwealth v Smith per Santow JA at [124] – [129]. For a trial to be fair it need not be perfect or ideal: Holt v Wynter per Priestley JA at [142]; McClean v Sydney Water Corp [2001] NSWCA 122. 35 In the respondent's submission in addition to presumptive prejudice it faces significant actual prejudice in meeting the applicant's claim should it be permitted to go forward. 36 The respondent relies on the absence of witnesses and/or contemporaneous records that permit independent examination of the applicant's conduct and disposition in the period prior to the collision. Donna Robinson, the respondent's solicitor, in her affidavit sworn on 10 August 2005, details inquiries that have been made to locate former naval personnel who may have known the applicant. His supervisors named in his Certificate of Service are either deceased or are not able to be located. Inquiries have been made of 24 sailors attached to the applicant's branch, who were serving on the Melbourne at the time of the collision. Only three recalled the applicant. Ms Robinson summarises the results of contact with two of these persons, neither of whom had any particular recall of the applicant. The respondent located one former sailor who worked with the applicant for 12 to 18 months prior to the collision and who has a good recall of him. He did not see the applicant again after it. 37 Ms Robinson identifies four former sailors who were on board the Melbourne at the time of the collision and who were members of the same branch as the applicant. Each of these has brought a claim arising out of the collision and for this reason Ms Robinson has not made contact with them. This group includes Brian Parke with whom the applicant was on good terms and who was with him in the immediate aftermath of the collision. Counsel for the applicant submitted that it did not sit well for the respondent to complain that a fair trial was no longer possible when it had chosen not to interview witnesses including Brian Parke. 38 In supplementary written submissions counsel for the respondent contended that it would be inappropriate for the respondent to approach other plaintiff's in similar actions directly. It was suggested that this may involve a breach of the Law Society's Rules and the Bar Rules. The submission was not further developed. I do not approach the matter on the basis that the respondent is precluded by the rules of professional conduct from contacting potential witnesses by reason that they are known to have themselves commenced proceedings against the respondent arising out of the collision. Given the likely overlap of issues, prudence may suggest that contact be effected through the witness' solicitor. 39 The respondent has not been able to locate any records relating to the applicant's employment for the period between his discharge from the Navy and 1987 when he commenced employment with the Scarborough Fair Shopping Centre. The respondent complains that the absence of records for a period in excess of 20 years leaves it without material to test the history that the applicant has given. In the respondent's submission there are inconsistencies in the applicant's history and these make the present application broadly comparable to those considered in Commonwealth v Diston [2003] NSWCA 51 and Blyth v Commonwealth [2005] NSWSC 721. 40 The inconsistencies in the history upon which the respondent placed emphasis were as follows: § The family psychiatric history; § The commencement of the onset of nightmares and flashbacks; § The nature and extent of sleep difficulties; § The degree of emotional attachment; · The extent of any difficulty in relating to work colleagues. § The account of events in the immediate aftermath of the collision. 41 The applicant relies on the expert opinions of Dr Troup and Dr Hopwood. Annexed to the affidavit of Donna Robinson sworn on 10 August 2005 is the report of Dr Gunn, a psychiatrist, who assessed the applicant on 9 January 2001 and submitted the results of that assessment to the Military and Compensation and Rehabilitation Service of the Department of Veterans' Affairs. Ms Robinson swore a third affidavit on 16 May 2006, which annexes a report by Dr Reddan, a consultant psychiatrist, who examined the applicant on 25 September 2002. The respondent also tendered the report of Dr Freed, a psychiatrist, dated 22 October 2002. 42 The inconsistency with respect to the family history that the respondent relies on is that Dr Reddan reported that the applicant was not aware of any family psychiatric history whereas the history that Dr Freed obtained included that the applicant's father and sister were alcoholic. The history that Dr Gunn obtained included that the applicant's brother had sought counselling during a time of marital conflict and that his sister had been through a difficult period in her teenage years and may have made a suicide attempt. No doubt the histories reflect the questions asked by the doctors. It was not suggested that the applicant had sought to conceal relevant matters in his family history from Dr Reddan. 43 There are inconsistencies in the histories obtained by the psychiatrists of the applicant's symptoms. Notable in this respect is the history obtained by Dr Reddan of the onset of nightmares and flashbacks when compared with that obtained by Dr Troup and Dr Hopwood. The opinions expressed by those qualified on the applicant's behalf are able to be tested by reference to the histories that the applicant acknowledges having given to other doctors. 44 In his first affidavit the applicant stated that he was unable to recall what he was doing in the couple of hours after the collision. Dr Troup recorded the following history: He said it was an unreal feeling that it happened, and it was like being in a nightmare. He was on the radar deck at the time. As soon as it hit he realised that he should be in the engineer's office but everything was battened down which he informed me was called "State Zulu". When everything was shut down, he went to the flight deck and became one of the rescue party. He said all the boats were out and picking up people from the water. He does not remember being aboard any of the boats. He said people were handed up to the rescue crew on the HMAS Melbourne. They were fishing people out of the water with nets. He said his memory is vague but he does remember fishing people out of the water. He said some men were covered with oil and he could smell oil. He remembers the next morning the HMAS Voyager survivors being laid out on mattresses and he had to ask their names and next of kin etc. To signal back the names of the survivors. He said he saw dead people from the HMAS Voyager but did not know where they went, he did not know if they went to the HMAS Melbourne or to HMAS Creswell or where they went. He said he wondered where the people were that had been in the area of the gaping hole. He then thought he could have been in that area. 45 In the course of cross-examination the applicant acknowledged that the history that he gave to Dr Troup was in some degree reconstructed and in other respects he believed that she had misunderstood what he had told her. He said of the reference to boats picking up people from the water, "it's not exactly recall, sir. It is something I know would have had to have happened". He believed that he would not have said to Dr Troup that he recalled fishing people out of the water with nets. In this respect he said, "we would not be fishing them out of the water with nets but they were using scrambling nets to bring them in board, sir" (T 24.51-54). He was asked if he recalled seeing this and he responded, "not really seeing it, sir. I don't remember but it would have happened" (T 24.57-58). 46 The applicant was challenged that he had embellished his account of what he had seen that night. This challenge, in light of his evidence to which I have referred and the material that I infer is available to the respondent concerning the facts of the rescue operation, is one that it is open to the respondent to explore. However, the present application does not, to my mind, raise the difficulties, which were prominent in Diston and in Blyth. I accepted the applicant as a witness doing his best to give a truthful and accurate account. 47 I do not understand it to be in issue that the applicant was present on the radar deck of the Melbourne and that he observed the collision. He was called to give evidence of his observations at the first Royal Commission into the causes of the collision. His claim to have thereby suffered psychiatric injury is in issue. He has given every indication of frankness in the histories that he acknowledges having given to Dr Gunn, Dr Freed and Dr Reddan. Notwithstanding the absence of independent evidence of the applicant's behaviour and disposition over many years I have concluded that the respondent is not significantly prejudiced in its ability to test his claim. 48 As I have noted, the applicant's claim includes a claim for economic loss. He contends that he has suffered an impairment of his capacity to earn income by reason of his undiagnosed PTSD. The applicant has produced group certificates for the financial years ending 30 June 1970 – 1983, 1989, 1991, 1992, 1995, 1996, 1998 and 1999. Income Tax Returns for the financial years ending 30 June 1997 and 1998 have been produced. The respondent noted that there were some gaps in the financial records, but this was not prominent in its opposition to the grant of leave. I consider that the material provides a reasonable basis for making an assessment of the applicant's actual earnings over a substantial part of the period, which is the subject of his claim. As I understand the economic claim, it depends upon the applicant establishing that he did not obtain and maintain employment at a salary level that he might reasonably have been expected to obtain had he not suffered from undiagnosed PTSD. The circumstance that supervisors from time to time at his various places of employment may not be available to the respondent does not seem to me to be a matter of great moment in the context of this claim. It was apparent from the applicant's evidence that he has never had a difficulty in obtaining employment and in remaining in it until he chose to leave and take up another position. He has been in constant employment from immediately after his discharge from the Navy until his retirement at the age of 66 years. 49 I have concluded that it is just and reasonable to extend the limitation period for the applicant's cause of action. ORDERS Pursuant to s 60G(2) of the Limitation Act 1969 (NSW) the limitation period for the cause of action in this proceeding is extended to the date on which the statement of claim was filed. ********** 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.