Supreme Court New South Wales Medium Neutral Citation: Healey v Penrith City Council; Healey v Ussher; Healey v GIO General Limited (No 2) [2014] NSWSC 1870 Hearing dates: 4-8 November 2013 Decision date: 23 December 2014 Jurisdiction: Common Law Before: Adams J Decision: The parties are to bring in draft minutes of orders reflecting the judgments. In the event they are unable to agree, written submissions are to be filed by 13 February 2015. If there is a dispute as to the question of costs, submissions on this matter are to be filed by that date. Catchwords: WORKERS COMPENSATION - damages - future care - whether gratuitous or commercial are appropriate - whether matter can be revisited under the slip rule WORKERS COMPENSATION - damages - apportionment of damages under s 151Z Workers Compensation Act where interposing negligence of third party - interest - whether interest payable in full - effect of plaintiff's delays in litigation Legislation Cited: Civil Liability Act 2002 (NSW) Law Reform (Miscellaneous Provisions) Act 1946 (NSW), s 51B Workers Compensation Act 1987 (NSW), s 151Z, s 151Z(2)(c), Pt 5 Div 3 Cases Cited: Fox v Wood (1981) 148 CLR 438 Izzard v Dunbier Marine Product (NSW) Pty Ltd [2012] NSWCA 132 Kalls Enterprises Pty Ltd (In liquidation) & Ors v Baloglow & Anor (No 3) [2007] NSWCA 298 Mainteck Services Pty Ltd v Stein Heurtey SA & Anor [2013] NSWSC 1563 Miller v Galderisi [2009] NSWCA 353 Category: Consequential orders Parties: 2007/292443: Ralph Stewart David Healey (Plaintiff) Penrith City Council (Defendant) 2010/350196: Ralph Stewart David Healey (Plaintiff) Robert William Ussher Junior (First Defendant) Usshers Pty Ltd trading as Ussher's Waste Management (Sixth Defendant) 2012/91723: Ralph Stewart David Healey (Plaintiff) GIO General Limited (Defendant) Representation: Counsel: 2007/292443: A Lidden SC/ E Welsh (Plaintiff) S J Walsh (Defendant) 2010/350196: A Lidden SC/ E Welsh (Plaintiff) S J Walsh (Defendants) 2012/91723 A Lidden SC/ E Welsh (Plaintiff) B McManus (Defendant) Solicitors: 2007/292443: Brydens Law Office (Plaintiff) James Tuite & Associates (Defendant) 2010/350196: Brydens Law Office (Plaintiff) James Tuite & Associates (Defendant) 2012/91723 Brydens Law Office (Plaintiff) Kennedy's (Australasia) Pty Ltd (Defendant) File Number(s): 2007/292443; 2010/350196; 2012/91723 Judgment Introduction 1On 30 June 2014 judgment on the principal issues in the trial was handed down and the parties directed to bring in draft orders calculating future gratuitous care, loss of superannuation, Fox v Wood and the apportionment required by s 151Z of the Workers Compensation Act 1987 (NSW), interest and costs. In addition, there were other matters requiring clarification. Thus, in paragraph [113] of the primary judgment dealing with past economic loss it was necessary to bring to account (by way of reducing this loss) the amount earned by the plaintiff as a truck driver in the year ending 2007. This sum was $15,360 but it was unclear from the evidence whether it was net of tax. It is agreed that the plaintiff's net income was in fact $15,630 plus a refund of $3,532 in relation to the excess PAYG tax paid by him. Accordingly, this amount is to be deducted from the total of $537,536, yielding in respect of past economic loss $518,374, which I understand is agreed. 2Most other matters, mentioned below, were agreed. However, some issues remained contentious and further submissions and an additional hearing were necessary. Those issues are discussed and determined in this judgment. Domestic assistance 3Past domestic assistance was, of course, calculated on a gratuitous basis. Whilst the amount allowed for future assistance was calculated on a commercial basis, my primary judgment mistakenly referred to this being for gratuitous assistance. In the result, I heard further submissions on the issue. 4The plaintiff's submitting that future domestic assistance should be on a commercial basis, the rate being $40 per hour. The only person in a position to provide domestic assistance for the plaintiff is his wife, who suffers from significant health problems herself. The plaintiff's evidence is that she is bipolar and, as a result of serious toxicity following inapt medication, has been left with a speech impediment and lack of co-ordination down the left side making her walking unstable: she suffers vertigo, finds it difficult to negotiate walking down steps and is somewhat unco-ordinated in her movements. Nevertheless, it is clear that she has been able to provide him with care in the past, undertaking most of the domestic chores. The plaintiff was not cross-examined on this aspect of his evidence. Mrs Healey also gave evidence of needing to take medication for her bipolar condition and as to her speech and imbalance, which she described as "a bit of vertigo". She is able to drive but preferred to be a passenger. This evidence also was not the subject of cross-examination. 5Mr Lidden SC for the plaintiff submitted in the course of oral argument that, bearing in mind the evidence concerning Mrs Healey's continuing physical problems it is unreasonable to expect her to be doing the heavier chores such as gardening and maintenance, which the plaintiff said takes a lot of time. Both the Council and GIO submitted that no allowance should be made for domestic assistance on the basis that the threshold was not met but did not take issue with the contention that, if allowed, it should be fixed at the commercial as distinct from the gratuitous rate. In my primary judgment I simply said, without discussing the rate (which, as I have pointed out, was not taken up by the defendants), "Future gratuitous care is allowed at 7 hours per week for 19.3 years". With some embarrassment, I must state in fairness that, by oversight, I adopted the language in the schedule of damages produced on the plaintiff's behalf (which referred to "future gratuitous care" although at the commercial rate). Mr Lidden had pointed out to me when he went through the schedule in oral submissions that "gratuitous" was an error for "commercial", this being made clear by the specified rate. 6The defendants now submit, referring to Miller v Galderisi [2009] NSWCA 353, that the evidence of the plaintiff's need for commercial assistance was not such as to establish sufficiently a probability that he would do so. Amongst other things, accepting the evidence of Mrs Healey's difficulties there was no evidence that she would not continue to offer the same care as hitherto. Nor is there any evidence of the likelihood that her condition might worsen, although age, with its concomitant difficulties, must be expected to have its inevitable effect, and that sooner rather than later, given her present compromised physical state. Given that the defendants did not take issue with the plaintiff's claim in this respect, I do not think they should be permitted to do so now, although it is quite legitimate to point out the apparent contradiction between the rate specified and the description of the care. Even were this not so, I am satisfied that, especially given the difficulties under which the plaintiff's wife suffers, it is appropriate to allow future commercial care of seven hours per week at $40 per hour for 19.3 years. It must be borne in mind that, as the plaintiff himself gets older, his need for care, contributed to by the continuing effect of his injury, will increase. This likelihood also justifies the transition from gratuitous to commercial care. 7A perhaps more fundamental question is whether this matter can be revisited under the slip rule. I have already explained that my decision on the question was based upon a mistaken adoption of the language in the schedule, overlooking the word "gratuitous", which had been corrected in submissions. The most recent discussion of the scope of the slip rule has been the useful (if I may respectfully say so) judgment of Sackar J in Mainteck Services Pty Ltd v Stein Heurtey SA & Anor [2013] NSWSC 1563. As his Honour said (citing authority to which it is not necessary to refer), the essential questions are whether there was an error arising from an accidental slip or omission and should the Court exercise its discretion to correct the error. In this case, the answer to both these questions is yes. Accordingly, I amend the primary judgment in accordance with the conclusion stated above in respect of future domestic assistance. Other corrections 8Other errors requiring correction concern the mistaken naming of Penrith City Council as a defendant in proceedings number 2010/350196 (the partnership proceedings). This resulted, as the Council rightly submits, from the filing of an amended statement of claim by the plaintiff without leave which led to an error when the Registry entered the party details. Accordingly, the title page of the judgment should be corrected by removing the reference to the Council from proceeding 2010/350196. The other correction is the need to address the position of Robert William Ussher Junior, who was sued as first defendant in the partnership proceedings. As I explained in paragraph [3] of my judgment, Mr Ussher was entitled to judgment plus costs in the partnership proceedings. The consequence is that the partnership proceedings are otherwise dismissed. Outstanding issues 9Moving to the outstanding matters, past loss of superannuation has been agreed at 11 per cent of $518,374, yielding a sum of $57,021. So far as Fox v Wood is concerned, the parties differ in respect of the period from 4 May 2005 until 2 November 2005 when no deductions for income tax were made although it appears that such deductions should have been made. The plaintiff submits, in effect, that the liability for tax during the May-November period should be taken into account, whilst the defendants submit that the plaintiff should not be compensated for income tax that was not in fact deducted. It seems to me that the plaintiff's liability is a subsisting debt in respect of taxation and accordingly should be taken into account. Accordingly, I allow $7,500 under this head. 10I now move to the issue raised by s 151Z(2)(c) of the Workers Compensation Act. It is submitted on behalf of the Council and GIO (and I think not disputed on behalf of the plaintiff) that each of them is a concurrent tortfeasor, liable in respect of the same damage and, although the plaintiff has a separate cause of action against each, the appropriate course is to enter judgment against each for the full amount, s 51B of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) preventing double recovery. The defendants rightly submit that where, as here, the plaintiff is entitled to take proceedings against his employer (prior to September 2004, Usshers Pty Ltd, thereafter Usshers Solid Waste Pty Ltd), s 151Z(2)(c) of the Workers Compensation Act 1987 requires the court to reduce the damages which may be recovered from the defendant Council by an amount that reflects the difference between the amount that would have been awarded against the employer at common law and the amount that was or would have been awarded under the Workers Compensation Act, calculated by a means of notional apportionment as between the defendant and the employer. The approach has been helpfully (if I may respectfully say so) set out in Izzard v Dunbier Marine Product (NSW) Pty Ltd [2012] NSWCA 132 by Macfarlan JA at [113]. Adapting his Honour's language to the circumstances here, Mr Healey's injuries were ones for which compensation was payable under the Workers Compensation Act and third parties (the Council and GIO) whom he has sued for damages raised a defence under s 151Z(2)(c), requiring the following steps: first, determination of the common law damages under the Civil Liability Act 2002 (NSW) and the workers compensation damages, if any, under Part 5 Div 3 of the Workers Compensation Act (this must be nil because the plaintiff did not clear the necessary 15 per cent impairment). In relation to the Council I have found the employer's contribution to the plaintiff's injuries was 50 per cent and, as to the GIO 15 per cent. In the first case, the employers' proportion of common law damages is 50 per cent. The second case is complicated somewhat because, although the Council was not a party, it nevertheless was still responsible for 50 per cent of the plaintiff's injuries and, although the GIO's insured's share of responsibility happens to be 15 per cent (derived from the liability of its non-employer joint tortfeasor), the employer's responsibility remains at 50 per cent, given the Council's contribution to the plaintiff's loss. It is then necessary to calculate the difference between the employers' proportion of common law damages and the employers' proportion of workers compensation damages. Of course, since no workers compensation damages are payable, it follows that this difference is the same sum as that represented by, in the one case, the Council's proportion of common law damages and, in the other, GIO's insured's responsibility for the whole of the damages less the employer's share of 50 per cent. It was first submitted on behalf of the plaintiff, however, that the relative contribution of the Council, being 50 per cent, and the GIO, being 15 per cent (the latter for the period after 30 November 2004), must lead to a finding for the purposes of s 151Z of 35 per cent in relation to the proportion of fault on the part of the employer after that date. Thus, it was initially submitted, the appropriate adjustment is to calculate the employer's liability over the whole period at 42.5 per cent, on the basis that the responsibility of it and Usshers became shared by Solid Waste as to 15 per cent, so that the share of each was, as it were, taken over from each equally by the latter, reducing Ussher's share to 42.5 per cent. During argument, however, Mr Lidden SC for the plaintiff submitted that the correct approach was to regard the employer's responsibility as unchanged (albeit it was a new employer) and, thus (as I understood him) to calculate the damages payable under s 151Z on the basis that the two employers remained responsible for 50 per cent. Although I do not altogether accept that the plaintiff's initial submission was incorrect, I am prepared to act on the basis that counsel's concession was correct. 11On behalf of GIO, Mr McManus submitted that Solid Waste should be regarded as 85 per cent responsible, in effect taking the Council out of the calculation because it was not a party to the action against the GIO. The difficulty with this argument, as I see it, is that the crucial element is the contribution of Solid Waste to the plaintiff's injuries, rather than Usshers'. The fact that the Council was not a party to the litigation between the GIO and the plaintiff does not change the extent of its responsibility. However, Mr McManus submitted (as I understood him) that, although Usshers, as a joint tortfeasor, might be liable for the whole, the GIO as its insurer should not be liable to pay part of Solid Waste's share of liability, when Usshers was held only to have made a 15 per cent contribution to the plaintiff's injuries. I do not accept this submission. The GIO stands in the shoes of Usshers, which was liable for the entire verdict, absent statutory variations, not presently relevant. The mere fact that it is an insurer does not affect this calculus. The consequence is that, applying s151Z (and Mr Lidden's concession), its liability is 35 per cent of the whole verdict. 12So far as interest is concerned, it was submitted on behalf of the Council and the GIO that, because of the delays in the litigation caused by the plaintiff, this should not be allowed in full. The issue was recently raised in Kalls Enterprises Pty Ltd (In liquidation) & Ors v Baloglow & Anor (No 3) [2007] NSWCA 298 where the Court (Giles, Ipp and Basten JJA) said - "[10] Delay is ordinarily not a reason for refusing or reducing the inclusion of interest. The defendant has had the use of the money, and the plaintiff has been out of its use and should be compensated accordingly. The purpose is to compensate the plaintiff for being kept out of its money (Bennett v Jones (1977) 2 NSWLR 355 at 367, 380; MBP (SA) Pty Ltd v Gogic (1991) 171 CLR 657 at 663; Grincelis v House (2000) 201 CLR 321 at [16]), not to punish it for delay (Bennett v Jones at 367; Geoffrey W Hill & Associates (Insurance Brokers) Pty Ltd v Squash Centre (Allawah North) Pty Ltd (1990) 6 ANZ Ins Cas 61-012 at 76,768; Clarke v Foodland Stores Pty Ltd (1993) 2 VR 382 at 397). Interest should be included unless good cause be shown, in order to fulfil the purpose (Ruby v Marsh (1975) 132 CLR 642 at 644; Falkner v Bourke (1990) 19 NSWLR 574 at 576); Clarke v Foodland Stores Pty Ltd at 389). [11] Delay can nonetheless be relevant to the exercise of the discretion. For example, unreasonable delay and a high interest rate may mean that the defendant is unjustly left as the source of the plaintiff's investment income. The question is one of injustice to the defendant. If the interest rates used by the plaintiff exceed commercial interest rates (although commercial interest rates are an imprecise criterion ... ), the plaintiff's self-inflicted loss of use of money may be unfairly made a burden on the defendant. [12] In the present case there was passage of time, but we do not accept that there was unreasonable delay of itself warranting reduction in interest. ... Unreasonable failure needed to be positively demonstrated, and it was not." 13Here, the plaintiff commenced his action within the three year limitation period. Some delay was occasioned by adjournment in the District Court (which the defendants do not rely on, as being beyond his control), and some three and a half years elapsed before the hearing in this Court. It is submitted that this delay arose from the commencement of parallel proceedings which were wholly unsuccessful. Other delays were incurred by the plaintiff not complying with various interlocutory orders in a timely way. However, the defendants had courses available to them if those failures were significant. The reasons for the delays are unexplained, in circumstances where it is for the defendants to establish they were unreasonable. Furthermore, there is no evidence that the defendants have suffered any injustice. 14In my view the defendants should pay interest up to judgment. There is no dispute that the rate should be applied to the whole period and halved. The plaintiff has provided a table showing that the total sum to 26 November 2014 is $228,669, half of which is $114,334. A slight addition needs to be made to cover the period to judgment. Directions The parties are to bring in draft minutes of orders reflecting the judgments. In the event they are unable to agree, written submissions are to be filed by 13 February 2015. If there is a dispute as to the question of costs, submissions on this matter are to be filed by that date. ********** 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. Decision last updated: 24 December 2014