Karl Schenk v Commonwealth of Australia [1997] ACTSC 79 (10 October 1997)

SUPREME COURT OF THE ACT

KARL SCHENK v. COMMONWEALTH OF AUSTRALIA
No. SC 720 of 1995
Number of
pages - 6
Limitations

COURT

IN THE SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY

HIGGINS J

CATCHWORDS

Limitations - Common law damages claim - Application to extend time to commence proceedings - Personal injuries - Commonwealth employee - Whether just and reasonable to extend time - Length and reasons for delay - Plaintiff unaware of common law rights and changes in Commonwealth case law - Whether prejudice to defendant - Conduct of defendant - Disabilities of plaintiff - Conduct of plaintiff - No point of principle.

Commonwealth Employees' Rehabilitation and Compensation Act 1988 (Cth), s44

Limitation Act 1985 (ACT), s36

Georgiadis v Australian and Overseas Telecommunications Corporation [1994] HCA 6; (1994) 179 CLR 297, discussed

Commonwealth of Australia v Mewett [1997] HCA 29; (1997) 146 ALR 299, applied

S & B Pty Ltd v Podobnik [1994] FCA 1433; (1994) 53 FCR 380, followed

Brisbane South Regional Health Authority v Taylor [1996] HCA 25; (1996) 139 ALR 1, followed

Ball v The Commonwealth (Gallop J, Supreme Court of the ACT, 13 February 1997, unreported), discussed

HEARING

CANBERRA, 22 August 1997 (hearing), 10 October 1997 (decision)

10:10:1997

Appearances

Counsel for the Plaintiff: R Livingstone

Solicitor for the Plaintiff: Higgins Solicitors

Counsel for the Defendant: G Stretton

Solicitor for the Defendant: Australian Government Solicitor (Cth)

ORDER

THE COURT ORDERS THAT:

1. The time be extended for the bringing of these proceedings pursuant to s36 Limitation Act 1985 (ACT) to and including 19 October 1995.

DECISION

HIGGINS J

This is an application for an extension of time within which to commence proceedings for damages for personal injury.

On 19 October 1995 the plaintiff in fact commenced proceedings against the defendant, his employer at the time of his injury.

The Statement of Claim, asserting causes of action in both contract and tort, complains of two (2) occasions, one on 23 October 1984 and the other during August 1985, when the plaintiff was injured in circumstances allegedly evidencing want of reasonable care for his safety and in the course of his employment.

It is evident that, unless time is extended pursuant to s36 Limitation Act 1985 (ACT), the plaintiff is procedurally barred from suing upon these causes of action as from 23 October 1990, in respect of the first of them and as from August 1991 in relation to the second, assuming the dates of injury to be correct.

The plaintiff bears the onus of satisfying me that it is just and reasonable to extend time.

It is not suggested in the present case that the causes of action asserted by the plaintiff are so insupportable as not to be seriously arguable. Nor is it suggested that the history he gives of the effect of the injuries and of the delay in commencing proceedings and reasons therefor are inaccurate.

In the first incident, the plaintiff experienced back pain when forced to take the weight of a heavy security cabinet then being moved. The pain was described as "severe". The plaintiff was off work for three (3) months, returning to the same duties.

In August 1985, it is alleged that the second incident occurred. A number of railway sleepers then being unloaded fell onto the plaintiff.

As a result of that incident the plaintiff suffered further injury. Subsequently, he became totally incapacitated for work and claimed compensation under the then statutory scheme. It was paid but the plaintiff was not then aware, nor was he advised, of any right he might have had to sue for damages at common law.

It was not until early 1989, as a result of difficulties in payment of compensation, that the plaintiff sought legal advice. He was then advised that his case had "common law potential" but that the liability of the Commonwealth had been extinguished under legislation taking effect late 1988.

That was a reference to the apparent effect of s44 of the Commonwealth Employees' Rehabilitation and Compensation Act 1988 (Cth). Until the decision in Georgiadis v Australian and Overseas Telecommunications Corporation [1994] HCA 6; (1994) 179 CLR 297, that legislation had been assumed to have extinguished the kind of causes of action the plaintiff in this case now seeks to assert. More recently, in Commonwealth of Australia v Mewett [1997] HCA 29; (1997) 146 ALR 299 the reversal of that assumption of extinguishment was extended to causes of action which had become statute-barred but were capable of extension either as at the date on which s44 took effect or later.

The causes of action pleaded by the plaintiff in this case had become statute-barred by 9 February 1994 when Georgiadis was handed down. Although that decision did not apply directly to causes of action procedurally barred otherwise than by virtue of s44 it was generally considered arguable that it was so applicable. The decision in Mewett's case affirmed that opinion.

Thus the issue for me is whether time should be extended in this case in respect of either or both of the causes of action the plaintiff has sued upon. In so deciding I must have regard to the factors referred to in s36(3) of the ACT Limitation Act as explained in S & B Pty Ltd v Podobnik [1994] FCA 1433; (1994) 53 FCR 380 and to the further considerations addressed by the High Court in Brisbane South Regional Health Authority v Taylor (1996) 139ALR1.

(i) Length and Reasons for Delay

The plaintiff had further difficulties obtaining payments of compensation between 1993 and early 1994. However, it was not until 17 February 1995, when he consulted his present solicitors, that he was advised of the Georgiadis decision. Whether the previous solicitors should between 9 February 1994 and that date have drawn the plaintiff's attention to it is not a matter which can be determined in these proceedings. Certainly, so far as the plaintiff is concerned, he cannot be regarded as having consciously declined to embrace whatever opportunity the High Court had opened by handing down Georgiadis.

On 17 February 1995 the plaintiff instructed his solicitors to obtain his Comcare file, no doubt to enable them to assess his prospects for common law action compared with his rights under the statutory scheme. They also sought the file held by his previous solicitor.

The latter file was reasonably promptly surrendered being received no later than early March 1995. The Comcare file was largely produced in the course of Administrative Appeal Tribunal proceedings but it was extensive, comprising over 380 pages.

A brief, including some medical reports sent as late as 27 March 1995, was assembled and sent to counsel for advice on or shortly after 15 June 1995. Initial advice was received about 3 July 1995. Some further material was requested and obtained as a result, at least in part, of that advice. That material was, it appears, sent to counsel for further advice.

It is relevant to note that the plaintiff's ongoing disabilities are considerable.

Whilst there is no detail as to the date or dates on which information necessary to file the Writ and Statement of Claim on 19 October 1995 was received by the plaintiff's solicitors, it is clear that the delay left unexplained in that direct sense is quite short.

I regard the delay from the dates of the injuries until 9 February 1994 as being satisfactorily explained by virtue of the terms of s44 and the general acceptance of its validity. The delay from then until February 1995 was not due to any deliberate decision of the plaintiff not to pursue his rights but rather to failure to obtain or receive advice as to the legal change which occurred on 9 February 1994 affecting the exercise of those rights. That delay was not unreasonable. Though Comcare had continuing dealings with the plaintiff over that period, it does not appear that it took any steps to inform the plaintiff of the Georgiadis decision or its possible effect on his rights.

The delay following February 1995 seems for at least the most part of it to be a necessary delay to enable the claim to be responsibly researched and formulated.

(ii) Prejudice to the defendant

The defendant, through its solicitor, deposed that a claim form, completed 24 October 1984, was received by it concerning the first accident. It gave as the name of a witness "Ken W. McGann".

The defendant has no record of a second injury at work in August 1985. It does have a record of an accident at 10.30am on 27 March 1985 involving falling railway sleepers. A witness "Allan Rankin" was named. It seems likely to me that this is the accident the plaintiff recalled as occurring in August 1985. If that is correct, that means that the time bar applies to the second injury as from 27 March 1991, not August 1991.

The plaintiff resigned his position on 3 October 1985. The letter of resignation cites as a reason "I have found better employment with promontion [sic] prospects".

A further claim form was submitted on 14 November 1989. Apparently, that was because of lost time from work after 13 September 1988 until that time and continuing. Part 5 of that form, as filled out by the plaintiff, clearly conveys that he alleged that the employer had been negligent in causing the injury to which he referred.

By then, even if not before, it should have been apparent that each compensation claim had some potential for a negligence claim of serious magnitude.

The defendant did make some enquiries but not, it seems, until March 1996. Mr McGann was then approached. He stated he did not actually witness the accident in October 1984. He could not recall any other details with accuracy. The supervisor, Mr Cameron, was not an eye-witness either. He agreed that he would have given the directions to move the security cabinets concerned. His attention does not seem to have been directed to the second accident at all. A search was made for Mr Rankin, but not, it appears, until August 1997. Not surprisingly, information concerning him could not be found.

Why it took so long to make even these inadequate inquiries is not explained. There was on 2 July 1991 a letter to Comcare from the plaintiff's then solicitors concerning his ongoing disabilities. Comcare replied on 6 August 1991 making reference to a motor vehicle accident on 25 May 1983 involving the plaintiff. I have no information on that accident but, plainly, Comcare did.

At that time, the defendant may have considered that it was not exposed to common law liability. However, it was not prudent, in my view, for the defendant not to have sought statements from witnesses earlier than March 1996. It should certainly have sought such statements in November 1989 when the likelihood of solicitors advising legal proceedings at least to enforce compensation rights was revealed. Insofar as prejudice results to the defendant from neglect or delay or error of law on its part, its complaint as to that prejudice must be accorded less weight.

It may be added that, on 17 February 1995, the plaintiff's current solicitors wrote to Comcare making it clear that they were advising the plaintiff as to his "entitlements" and requesting copies of relevant documents. At that time the defendant's agencies, particularly Comcare, would have been well aware of the risk of common law proceedings being instituted.

I would add, because it was asserted otherwise, that Comcare is an agency of the Commonwealth, albeit that it is constituted by statute rather than by the Executive Government. Notice to it of intention to sue is therefore notice to the defendant. Further, it has records and access to records and the resources to make relevant enquiries so as to enable the defendant to assess and meet claims such as the present.

(iii) Conduct of the Defendant

To some extent, in relation to prejudice, I have already noted relevant conduct of the defendant. However, the defendant not only should be a "model litigant", it should also be a "model employer".

Thus, whilst it was under no legal obligation so to do, it would have been reasonable for Comcare to have advised ongoing claimants of the Georgiadis decision and its possible implications for their common law rights. It did not do so. Even if it be regarded as unreasonable to advise claimants who did not seem to be alleging fault from November 1989, Comcare was aware that the plaintiff alleged fault against his employer in respect of the November 1984 injury. There was ongoing correspondence thereafter up to and beyond 9 February 1994.

This is not, it may be added, a factor of great significance but it did contribute to delay between that date and February 1985.

(iv) Disabilities of the plaintiff, their duration and progress

It was the plaintiff's recollection that his employment threatening disabilities occurred from August 1985.

The records suggest that recollection is mistaken. The claim form dated 15 November 1989 refers to cessation of employment as a result of compensable disability from 13 September 1988 but not earlier. The resignation of October 1985 does not refer to any disabling condition then appearing.

The medical reports disclose a condition likely to have deteriorated over time, whether suddenly due to some trauma, even fairly minor, or continued work activity.

The plaintiff is reported to have left full time work on 12 September 1985, according to Dr Chandran's report of 10 September 1990. His later report of 9 September 1991 refers to a motor vehicle accident on 1 July 1985. Again, that is a variance from the reference by Comcare to a motor vehicle accident of 25 May 1983. It may be these were two accidents.

He is reported by Dr Chandran, 13 February 1990, to have worked casually up to 1986 when he "last worked". That varies from the claim form referred to above referring to cessation of work as from 13 September 1988.

It is clear that the history is somewhat confusing. There may well have been two aggravating events in 1985, only one of which was work related.

It is not necessary for me to resolve these apparent historical anomalies. Comcare was fully informed of all these matters. It possessed all the documents in which they appeared including Dr Chandran's reports. It could and should, in the defendant's interests, have sought documentation in respect of all these matters even if only to resolve the issue of causation. Perhaps it did. It was, nevertheless, aware of the plaintiff's disabilities, their duration and progress.

Those disabilities are and were serious and ongoing. They became a threat to the plaintiff's employment capacity only some years after they were first experienced.

(v) Prompt action by the plaintiff

This question has already been addressed in considering delay. It can only relevantly be weighed adversely to the plaintiff outside the period during which s44 was apparently in force. There was a failure promptly to act and to seek advice up to December 1988 when the bar imposed by s44 took effect. However, during that period the plaintiff had actively pursued his statutory compensation rights. He was not advised by Comcare to seek advice as to possible common law rights. He was unaware of his rights otherwise. He did not become aware until, disputing his statutory rights to compensation, Comcare motivated the plaintiff to seek legal advice. It also seems that by then the plaintiff's physical condition had deteriorated so as to preclude employment.

(vi) Steps taken by the plaintiff to obtain relevant advice

Those steps have been referred to in considering delay.

(vii) Just and reasonable

It is important to weigh not only any actual prejudice arising from the overall delay but also the prejudice arising from the potential reversal of the defendant's legitimate expectation that a time barred cause of action will not be brought against it. That is, of course, subject to the weight to be afforded to other contrary factors including the extent to which the defendant is otherwise faced with the prospect of ongoing liability, for example, under a statutory compensation scheme. That is relevant particularly if it "keeps alive" the defendant's interest in the circumstances in which the relevant injury was suffered and the progress of any claimed disabilities. Further, as Gallop J recently noted in Ball v The Commonwealth (Supreme Court of the ACT, 13 February 1997, unreported), the loss of an opportunity to pursue apparently arguable common law rights to substantial damages for serious disability is seriously prejudicial to a plaintiff.

In this case, in all the circumstances I am persuaded that it would be just and reasonable to extend time for the bringing of these proceedings up to and including the date of actual commencement, namely 19 October 1995. I so order.

I will hear the parties as to costs.