Elliott-Terranova v State of New South Wales [2013] NSWSC 555

Supreme Court New South Wales

Medium Neutral Citation: Elliott-Terranova v State of New South Wales [2013] NSWSC 555 Hearing dates: 13 May 2013 Decision date: 13 May 2013 Jurisdiction: Common Law Before: Beech-Jones J. Decision: Settlement approved. Catchwords: Approval of settlement - No question of principle. Legislation Cited: - Civil Liability Act 2002 - s 43A - Civil Procedure Act 2005 - s 76 Category: Principal judgment Parties: Valerie Elliott-Terranova (by her next friend Andrea Cairns) (Plaintiff) Lollita Elliott (First Defendant) Ross Terranova (Second Defendant) State of New South Wales (Third Defendant) Representation: Counsel: D. Letcher QC, S. Gardiner (Plaintiff) No appearance (First Defendant) No appearance (Second Defendant) D. Mallon (Third Defendant) Solicitors: RTW & Associates (Plaintiff) I.V. Knight, Crown Solicitor (Third Defendant) File Number(s): 2006/267054

EX TEMPORE Judgment 1This is an application for approval of an infant settlement under s 76 of the Civil Procedure Act 2005. The parties also seek certain ancillary orders concerning the first and second defendants. 2The plaintiff was born on 20 April 2001. The first and second defendants are her natural parents. The third defendant, the State of New South Wales (the "State"), is sued in its capacity as the legal entity responsible for the conduct of officers employed within the Department of Family and Community Services (the "Department"). 3The plaintiff has alleged that officers of the Department had an extensive knowledge of the difficulties experienced by her parents in caring for children including her and were aware of their propensity to perpetrate physical abuse. The plaintiff was first taken into that Department's care while she was still in hospital after being born. During 2003 she was restored for a period to the care of the first and second defendants. Apparently this was undertaken as a consequence of some orders made by the Children's Court. On 27 June 2003 the plaintiff was admitted to Westmead Children's Hospital with very significant injuries. On 1 April 2004 the first defendant, her mother, pleaded guilty in the District Court to a charge of maliciously inflict grievous bodily harm upon the plaintiff in respect of those injuries. 4The first and second defendants have not taken any role in the proceedings. The plaintiff also sued the State, alleging negligence on the part of officers of the Department in their supervision of the welfare of the plaintiff and the conduct of the first and second defendants. 5The proceedings were referred for a mediation before Mr Morris QC on 11 April 2013. The first and second defendants did not participate. After what is described as lengthy negotiations, an agreed settlement sum of $5.5 million plus costs was agreed upon, subject to the need to obtain the Court's approval for the settlement. 6In support of the application for approval, an opinion has been tendered from the plaintiff's senior counsel and junior counsel, Mr Letcher QC and Mr Gardiner (the "opinion"). The opinion identifies what could be described as the "top of the range" estimate of the plaintiff's damages as being slightly above $8 million. The opinion also refers to potential areas of disputation over the quantum damages. The authors note that Senior Counsel for the State described the "full value" of the plaintiff's case as around $7 million. The advice therefore notes that the agreed figure of $5.5 million was 68% of the realistic full value of the case that they identify, and 79% of the full value that Senior Counsel for the State had apparently identified. 7The opinion also noted various arguments on liability that had been raised on behalf of the State. It was apprehended that it would be contended on behalf of the State that, in circumstances where the return of the plaintiff to her parents was directed by a Children's Court order and that the immediate cause of injuries suffered to her was the criminal act of her own mother over whom it had no immediate control, that there were substantial reasons for the State to deny liability. 8It was also apprehended the State would contend that under the relevant child protection legislation the State could only intervene on an urgent basis by exercising a particular statutory power that would fall within s 43A of the Civil Liability Act, i.e., a "special statutory power". The authors of the opinion note that the test for negligence in respect of such a power is essentially Wednesbury style unreasonableness. 9It is not appropriate on an application such as this for me to undertake any in-depth analysis of the relative prospects of success of the plaintiff's proceedings. Given that some of the provisions that would need to be considered in the event the matter was litigated are untested, a settlement involving somewhere between 70 to 80% of the full value of the claim in circumstances where the immediate injuries were caused by the act of another strikes me as a favourable outcome to say the least. 10The competing assessments of quantum that were identified by the respective legal teams at the mediation reflect the very significant injuries suffered by the plaintiff as a result of the assault by her mother. I will only briefly refer to some of the medical material that was provided to me concerning that issue. 11Emeritus Professor Robert Ouvrier, a paediatric neurologist, diagnosed the plaintiff as having suffered an "intellectual disability, epilepsy and microcephaly secondary to a traumatic brain injury" as a result of the assault. 12Dr Richard Webster, a paediatric neurologist at the Children's Hospital at Westmead, expressed a conclusion as to the plaintiff's injuries as a result of the assault in the following terms: "It is my opinion that Valerie suffered very significant brain injury in 2003. It has resulted in a permanent and severe impairment in brain function, in particular, her cognitive function and also her motor function. I believe the brain injury she sustained in June 2003 is also responsible for her refractory epilepsy. This in turn has resulted in further cognitive problems with severe problems in her learning as a result of recurrent seizures and the side-effects of treatment with epileptic medications." 13A report from a consultant paediatrician indicates that the plaintiff is prescribed with a significant number of medications to deal with the ongoing sequelae of the assault, including her epilepsy. The level of medication she receives is very significant for someone who is still just twelve years of age. 14As is to be expected in a case of this scope, the parties prepared extensive occupational therapy reports. I will not traverse the details of those reports, but they both address the very significant ongoing care needs of the plaintiff. In the estimates that were provided in the opinion it was clear that the most significant component of her damages claim was for the cost of future care. 15There was also an economic loss component. Understandably enough, as formulated on her behalf it was ostensibly a claim for loss of average weekly earnings. 16The end result of this is that it is clear on the material prepared by both parties that the quantum of the plaintiff's claim is very substantial. However it is also clear that, without conducting any investigation into the role played by the officers of the Department, the proceedings appeared to raise a number of issues concerning the interrelationship between the statutory powers exercised by officers under the relevant child protection legislation and the provisions of the Civil Liability Act. It follows that it would be very difficult to conclude that a verdict for a plaintiff was inevitable. 17In the circumstances, I have no hesitation in approving the settlement put forward by the parties. 18For the sake of completeness, I should add that an affidavit was read on behalf of the State outlining the current care regime and arrangements for the plaintiff. The tutor is her foster carer, who shares joint responsibility with the State for her welfare. The tutor receives a level of income support to assist her in looking after the plaintiff. I was advised that no aspect of that income support will be affected by the approval of the settlement. 19Accordingly the court will make the following orders: (1)Pursuant to s 76 of the Civil Procedure Act the Court approves the settlement agreed between the plaintiff and the third defendant that is expressed in the document entitled Consent Judgment/Order dated 11 April 2013 and which provides inter alia that the third defendant pay to the plaintiff $5,500,000 plus costs. (2)Judgment for the plaintiff in the sum of $5,500,000 plus costs as agreed or assessed. (3)Direct the third defendant to pay into court the settlement sum to be paid out to the NSW Trustee and Guardian for management on behalf of the plaintiff less the following amounts: (a)Victims Services $50,000; (b)Medicare Australia $8,601.65; (c)Peoplecare $3,683.05. (4)Order that the proceedings against the first and second defendant be dismissed with no order as to costs. (5)Order that the cross claims be dismissed with no order as to costs.