Thinking | 22 January 2018

WA Insurance Round-Up – Issue 5


Case updates

Workplace injuries

Dismissal of appeal of arbitrator’s decision declining application for additional funding
The importance of objectivity when determining whether discipline is unreasonable and harsh
Application of Napier test on causation for medical expenses
Cause of incapacity essential in determining entitlement to prescribed amount
Worker’s subjective belief does not determine ‘course of employment
Attempts to re-litigate a resolved dispute results in award of indemnity costs
High Court to decide: new category of duty of care for employers?
Safe system of work requires consideration of common degenerative condition

Motor vehicle accidents

Court finds in favour of ICWA in driver dispute

Occupier’s liability

Slippery spillage still ‘speculative’
Property agent landlord and occupier liable for collapsed balcony

Medical malpractice

Contingency discount applied to wrongful birth claim

General liability

Third party ordered to contribute to damages for injury caused by ‘substantial and overwhelming’ negligence of another

Workplace injuries

Dismissal of appeal of arbitrator’s decision declining application for additional funding

The District Court of Western Australia has dismissed an appeal by a worker against a decision of the WorkCover Arbitration Service, dismissing his application for additional workers’ compensation entitlements.

The worker had made an application for arbitration pursuant to section 217 of the Workers’ Compensation and Injury Management Act 1981 (WA) (Act), seeking an extension to the prescribed amount for weekly payments of compensation in the sum of $163,477.50 on the basis that he is permanently and totally incapacitated for work as a result of a compensable injury under the Act.

Following his application being dismissed, the worker lodged an appeal at the District Court, claiming an error of law on five grounds. One of those grounds was that the arbitrator applied the incorrect higher standard of proof found in Briginshaw v Briginshaw when he referred to the need for ‘clear and cogent evidence’ in his decision

The Court dismissed this ground of appeal on a number of grounds. In particular, the Court adopted the submissions of the respondent employer and found that there is no third standard of proof referred to in Briginshaw v Briginshaw. Rather, there is simply the civil standard of proof on the balance of probabilities or the criminal standard of proof of beyond reasonable doubt. There is no intermediate level or other standard of proof between these two standards.

Ultimately, the Court found that the arbitrator did not fall into error in his decision-making and there was no lawful basis to set aside his findings. He was not persuaded that any of the grounds of appeal had been made out and the appeal was dismissed.

This decision is a rare appeal decision concerning section 217 applications and is useful in setting out the principles to be applied. It is also significant for reinforcing that there is no intermediate standard of proof, albeit ‘Briginshaw’. The quality of evidence required to establish certain facts may be different depending on the seriousness of the issue. In that regard, the decision may be contrasted with the earlier decision in Massih v Western Power.

Owen George v Qube Ports Pty Ltd [2017] WADC 97

The importance of objectivity when determining whether discipline is unreasonable and harsh

The District Court of Western Australia has further considered the circumstances where discipline may be considered ‘unreasonable’ and ‘harsh’ in the context of stress claims made pursuant to the Workers' Compensation and Injury Management Act 1981 (WA) (Act).

Mr Spase Suleski worked for the Pilbara Iron Company. Pilbara was unhappy with Mr Suleski’s job performance, so placed him on a Performance Management Plan (PMP). The PMP contained the condition that if Mr Suleski failed to comply with the PMP, he may be dismissed. Mr Suleski made a claim for compensation and alleged that he suffered a psychiatric disease as a result of the PMP.

At first instance, the arbitrator found that placing Mr Suleski on the PMP constituted discipline and Mr Suleski suffered his psychiatric disease as a result, for the purpose of section 5(4) of the Act. The arbitrator considered that Pilbara was unable to justify why Mr Suleski was placed on the PMP rather than an alternative plan and Pilbara had therefore acted unreasonably and harshly. On this basis, Mr Suleski’s injury was deemed compensable.

Pilbara appealed the arbitrator’s decision and the parties appeared before His Honour Judge Herron. The principal issues for determination were whether the arbitrator correctly characterised the PMP as disciplinary and whether the implementation of the PMP was unreasonable and harsh. His Honour considered that the medical evidence established that the PMP was the predominant cause of Mr Suleski’s injury, and the arbitrator erroneously considered the issue of causation.

Whether an action amounted to discipline requires consideration of the terms and conditions that governed the employment relationship. In this regard, each case turned on its own facts and it was necessary to review the disciplinary guidelines, codes of conduct and protocols that governed the employment relationship. After considering the facts of the case, His Honour found that the PMP clearly amounted to discipline as the PMP issued to Mr Suleski was for the purpose of managing and addressing Pilbara’s concern about work performance. It was not a mere training tool and was equivalent to a warning letter.

Whether discipline is unreasonable and harsh is contextual and varies according to the facts of each case. All the circumstances must be viewed objectively and he considered that Mr Suleski’s subjective belief is irrelevant. The relevant circumstances on the facts included the circumstances surrounding the implementation of the PMP, how Mr Suleski was informed of the PMP, Pilbara’s codes of conduct and conditions of employment and how the PMP impacted upon Mr Suleski personally and professionally. Mr Suleski bore the onus of establishing that the discipline was unreasonable and harsh and failed to provide any admissible evidence.

His Honour considered that employers are entitled to take administrative action to manage their workforce, independent of their employee’s subjective psychological drivers of the employee's reaction. In this case, Mr Suleski had the opportunity to address his poor performance under the PMP and His Honour found that Pilbara’s actions were therefore not unreasonable and harsh. Pilbara had the right to take action against Mr Suleski’s unsatisfactory performance without being exposed to a stress claim.

This case confirms that determining whether an employer’s actions were unreasonable and harsh requires an objective assessment of the facts and a worker’s subjective belief is irrelevant.

This decision is pending appeal.

Pilbara Iron Company (Services) Pty Ltd v Suleski [2017] WADC 114

Application of Napier test on causation for medical expenses

A District Court judge has dismissed a worker’s appeal against an arbitrator’s decision to decline funding for the medical expenses associated with a secondary psychiatric condition, as she had failed to establish a causal link with a compensable injury.

Teresa Clarke was a registered nurse who suffered a compensable lower back injury (physical) in September 2009. In November 2010 she was issued with a final medical certificate on the basis that she had fully recovered from the physical injury and was fit to return to work. Ms Clarke resigned and commenced employment with a new employer in January 2011. In 2016, Ms Clarke brought proceedings seeking orders for payment of medical expenses to treat psychological symptoms (psychological), which she alleged resulted from the physical injury due to chronic back pains.

The arbitrator dismissed Ms Clarke’s application on the basis that there was insufficient evidence to establish a connection between Ms Clarke’s psychological injury and what she described as chronic back pain, which she claimed resulted from the physical injury.

Ms Clarke appealed against the arbitrator’s decision on the basis that he had misapplied the test of causation for statutory expenses as outlined in Napier v BHP Billiton (Worsley Alumina) Pty Ltd [2015] WASCA 230. Ms Clarke submitted that the psychological injury was a ‘disability that was wholly or partly caused by or attributable to’ the physical injury and she relied on a number of reports from psychiatrists tendered in evidence that confirmed that the psychiatric injury had a sufficient connection to the physical injury, notwithstanding numerous other non-work related causal factors, making the expenses incurred sufficiently connected.

His Honour Judge Bowden confirmed that the test for causation for medical expenses was outlined in Napier, and the ‘… arbitrator continually referred to the need for that connection… and the need for sufficient evidence to establish that connection… He was not required to repeat phrase by phrase the Napier test…’ His Honour noted that the arbitrator had made specific findings of fact that Ms Clarke had fully recovered from the physical injury, and that she did not provide sufficient evidence to connect the recurrence of her back symptoms eight months after the final medical certificate. His Honour agreed that in applying the Napier test to these factual findings, the worker had failed to establish the required connection between the physical injury and the expenses claimed.

This case confirms that Napier has set a new test on causation for medical expenses, which is broader than the test of causation for incapacity as outlined in Leggett v Argyle Diamond Mines Pty Ltd [2000] WASCA 182, statutory expenses are not only payable for a secondary injury arising out of the compensable injury, but also any symptoms or effects which can be wholly or partly caused by the compensable injury.

This decision is pending an appeal by Ms Clarke to the Court of Appeal.

Clarke v Ramsay Health Care Australia Pty Ltd [2017] WADC 117

Cause of incapacity essential in determining entitlement to weekly payments 

A District Court judge has dismissed a worker’s appeal from the decision of an arbitrator dismissing an application for the employer to pay weekly payments for total incapacity on the basis that the arbitrator had taken the cause of the incapacity into account in making her decision.

Ms Baigent injured her arm and neck at work on 14 June 2012. Qube Ports Pty Ltd (Qube) accepted liability for the claim and paid weekly payments of compensation prior to Ms Baigent returning to work on 14 March 2013. On 1 August 2013, Ms Baigent injured her neck at work and Qube commenced payment of weekly payments.

At some stage after 24 August 2014, Ms Baigent requested confirmation that a fresh injury had occurred on 1 August 2013. No confirmation was given. The prescribed amount was exhausted on 5 June 2016 and weekly payments ceased.

Ms Baigent lodged an application seeking a determination of liability in relation to the injury sustained on 1 August 2013, payment of weekly payments from the date of cessation and payment of statutory expenses.

The issues between the parties included determination of liability for the injury sustained on 1 August 2013 and whether Ms Baigent was entitled to weekly payments. Ms Baigent submitted that the prescribed amount in relation to the 2012 injury had been exhausted and that there was a 2013 injury giving rise to new prescribed amount.

The arbitrator considered the issue of whether Ms Baigent’s incapacity following 1 August 2013 resulted from the 2012 injury or the 2013 injury. The arbitrator found that the incapacity arose from the 2013 injury and so Ms Baigent was entitled to a new prescribed amount from 1 August 2013. However, Ms Baigent was not entitled to the weekly payments claimed given that the weekly payments which had been made exceeded the prescribed amount.

Ms Baigent appealed the decision, alleging that the arbitrator erred in law in making her findings not on the issues before her but on the issue of the cause of the incapacity from 1 August 2013 onward. Ms Baigent also claimed that the arbitrator took into account irrelevant considerations such as the total of payments previously made.

The Court found that the arbitrator was not simply being called upon to make a general pronouncement on the question of liability but to determine whether, having found liability established, she should order the weekly payments claimed. The Court found that it was essential for the arbitrator to determine whether the incapacity and weekly payments from 1 August 2013 related to the 2013 injury in deciding whether to order the weekly payments claimed.

This decision is a win for common sense that it is necessary for the cause of a period of incapacity to be determined prior to making an order to the payment of weekly payments associated with that incapacity.

Baigent v Qube Ports Pty Ltd [2017] WADC 143

Worker’s subjective belief does not determine ‘course of employment’

The District Court of Western Australia has found that a worker who was injured when she attended the workplace on her rostered day off was not injured in the course of her employment.

On 8 April 2014, Ms Karen Wyatt, a registered nurse, attended at Peel Health Campus (employer) to complete a graduate nurse’s form (form), which the employer required her to do. However, the employer did not at any point request that she attend the hospital on her day off to complete the form, and Ms Wyatt admitted that she attended the hospital as she was unable to access the form on her own computer at home.

At first instance, the arbitrator found that the completion of the graduate nurse’s form was an incident of Ms Wyatt’s employment and that she attended the hospital to complete the form to meet her obligations to the employer. The arbitrator found that there was a clear association between her attendance at the hospital and the employment and that, at the time she was injured, she was not prohibited from attending the hospital and was authorised to be there.

On appeal, Judge Birmingham QC held that Ms Wyatt was not performing any actual work duties within her scheduled work hours. Applying the High Court decision in Hatzimanolis and Comcare v PVYW, for Ms Wyatt to have suffered an injury in the course of her employment, the employer must have required, induced, authorised, expected or encouraged her to be at a particular place and at a particular time and do the very thing when the injury occurs.

His Honour considered that it was insufficient for an employer to induce or encourage a particular outcome, in this case, to complete the form and leave it to Ms Wyatt to choose the time, place and way of achieving that outcome. In particular, His Honour found that the arbitrator erred in law when he took into account her subjective belief that she had to complete the form on that particular day.

He considered that a finding that the implicit inducement or encouragement was present due to the fact that the employer had not expressly forbidden its employees to attend the hospital on their days off, was insufficient.

His Honour concluded that Ms Wyatt was not within the course of her employment. It was not enough that at a different time, the hospital was her workplace and while her employer had requested that she complete the form, it did not request that she complete the form at the specific time or place which she elected to pursue of her own volition.

This decision confirms that in order for an injury occur in the course of employment in both an interval period and two discrete periods of employment, an employer must have specifically induced or encouraged a worker to not just complete a specific activity, but that the employer must have also induced and encouraged the worker to be at the specific place and undertake the activity that resulted in the workplace injury. The test remains an objective one and a worker’s subjective belief that they are undertaking activities that are in pursuit of the employer’s interests is irrelevant.

This decision is pending an appeal by Ms Wyatt to the Court of Appeal.

Ramsay Healthcare Australia Pty Ltd v Wyatt [2017] WADC 145

Attempts to re-litigate a resolved dispute results in award of indemnity costs

The Western Australian Court of Appeal has dismissed an appeal that attempted to re-litigate an issue that had been resolved by an agreement. The Court of Appeal further held that this constituted an abuse of process which justified an award of indemnity costs against the appellant.

Mr Johnson was employed by Cunderdin Roadhouse (Company) as a cook. In 1996 Mr Johnson lodged an application at WorkCover for weekly payments from 19 November 1995 to 18 June 1996. In 1998 the dispute for payment of weekly payments was settled for $11,331.60 pursuant to an agreement at conciliation. The Company subsequently failed to pay the agreed sum to Mr Johnson.

In 2002 Mr Johnson commenced proceedings in the Magistrate’s Court to enforce the agreement and in 2005 Mr Johnson received judgment to enforce the agreement. The Company was then voluntarily deregistered and Mr Johnson commenced proceedings against the directors personally in an attempt to enforce the agreement. Mr Johnson was unsuccessful and costs were awarded against him.

In 2010 Mr Johnson commenced proceedings in the District Court against the surviving director (the other had passed away). Mr Johnson submitted that the Company was fraudulently deregistered to avoid the outstanding workers’ compensation liability. This action was settled at mediation on the basis that the director agreed to forego the Magistrate’s Court costs order on the condition that both parties released each other from all claims, actions and demands.

In 2013 Mr Johnson had the Company reinstated and commenced new WorkCover proceedings to recover weekly payments for the same period and amount that was the subject of the previous proceedings in the Magistrates Court and District Court. The arbitrator dismissed Mr Johnson’s application on the basis that she had no jurisdiction to hear the dispute and judgment had already been obtained in the Magistrates Court. The District Court dismissed the appeal and held that Mr Johnson’s claim constituted an abuse of process as it attempted to re-litigate an issue that was the subject of an existing agreement. The District Court awarded the Company indemnity costs against Mr Johnson.

Mr Johnson appealed the costs order to the Court of Appeal. Their Honours considered that the issues on appeal were whether Mr Johnson’s claim was an abuse of process and whether costs were to be assessed on an indemnity or ordinary basis. Their Honours considered that an abuse of process was a matter of substance rather than form and the broader context of the claim demonstrated that the action was an abuse of process, and that indemnity costs were appropriate for an abuse of process that lacked merit. Their Honours found that the arbitration application and the appeal to the District Court were correctly dismissed. The ground of appeal had lacked merit.

Further, their Honours found that any difference between ordinary and indemnity costs would be disproportionate to the burden which the appeal would impose on the parties and the community. Their Honours held that it was not in the interests of justice to grant leave to appeal against the orders made by the primary judge.

This case highlights that parties cannot re-litigate a resolved dispute and to do so may result in the Court awarding costs against that party on an indemnity basis.

Johnson v Denwest Nominees Pty Ltd t/as Cunderdin Roadhouse [2017] WASCA 200

High Court to decide: new category of duty of care for employers?

Does an employer owe a duty of care to provide a safe system of work when conducting workplace investigations?

The High Court will consider this question in the context of an investigation into misconduct in the workplace in an appeal from the decision of Govier v The Uniting Church in Australia Property Trust (Q) [2017] QCA 12.

Toni Maree Govier was employed as a disability worker when she was involved in a physical altercation with a colleague and suffered injuries. During an investigation into the incident, the employer sent two letters to Ms Govier which she alleged aggravated her psychiatric injury. Ms Govier submitted that the employer owed her a duty of care in respect of the content and timing of the letters.

The primary judge found that Ms Govier’s case was based on the premise that the duty to provide a safe system of work extended beyond the conduct of tasks an employee was engaged to perform and comprehended an obligation to supply a safe system of investigation and decision making in relation to matters concerning the contract of employment itself.

The primary judge held that the proposed duty of care should not be recognised based on the case of State of NSW v Paige [2012] NSWCA 235. In Paige, the New South Wales Court of Appeal held that a proposed duty owed by an employer to supply a safe system of work to an employee in relation to the incidents of the contract of employment, such as in disciplinary procedures (as was the circumstances in Paige), was a novel category of duty which involved an extension beyond the duty established by the authorities to provide a safe system of work in relation to the conduct of tasks for which an employee was engaged.

The Queensland Court of Appeal dismissed Ms Govier’s appeal and affirmed the primary judge’s finding that the employer did not owe her a duty of care to avoid injury by sending the letters.

On appeal to the High Court, Ms Govier will submit that her case can be distinguished from Paige and that the duty of care should be extended to cover the investigations and in particular, the respondent’s conduct in sending of a letter. The employer, on the other hand, will maintain that investigations are a contractual right and not affected by the tortious duty of care.

The pending High Court decision may have significant implications for employers as it may extend an employer’s duty of care to matters ancillary to the employment contract.

The High Court is expected to hear the appeal in early 2018.

Govier v Uniting Care Community [2017] HCATrans 183

Safe system of work requires consideration of common degenerative condition

The Queensland Court of Appeal has recently found that a plaintiff with a pre-existing degenerative condition common to the population was owed the same duty of care by his employer as the general population.

Berhane Ghebreigziabihr Berhane was employed by Woolworths Limited (Woolworths) as an order selector in a large warehouse where he was required to lift and stack various cartons. Mr Berhane had pre-existing asymptomatic rotator cuff disease in his shoulder when he commenced his work and the strain of that work aggravated his condition and caused a further injury.

Mr Berhane commenced proceedings claiming damages for personal injuries. The District Court dismissed his claim on the basis that he had not proved that his injury was caused by any breach of duty on the part of Woolworths.

Mr Berhane appealed to the Court of Appeal. Mr Berhane submitted that 10% to 15% of the general population have rotator cuff disease and that this was such a significant segment of the population that the general duty of care of the employer was broad enough to accommodate those with that condition. Woolworths submitted that there was no duty of care in relation to Mr Berhane’s pre-existing condition.

Morrison of the Court of Appeal found in favour of Mr Berhane. In coming to that decision, Justice Morrison cited the Court’s decision in Calvert v Mayne Nickless Ltd (No 1) [2006] 1 Qd R 106 as authority for the proposition that ‘if the pre-existing degenerative condition is quite common in persons of the employee’s age, that can be a basis for concluding that the employee is nonetheless within a class of people within the normal range of health and strength’.

Justice Morrison went on to find that Mr Berhane’s condition was sufficiently common in the general population that the risk of injury was foreseeable and the duty was not a ‘special’ or ‘higher’ duty, but rather the normal duty to take reasonable care not to expose Mr Berhane to a risk of injury.

This decision serves as a useful reminder that employers ought to take the safety of individuals suffering from common degenerative conditions into consideration when creating a safe system of work in manual handling roles.

Berhane v Woolworths Ltd [2017] QCA 166

Motor vehicle accidents

Court finds in favour of ICWA in driver dispute

The District Court has dismissed a motor vehicle accident claim after not being satisfied that the defendant (the plaintiff’s son) was the driver of the vehicle.

Brian Benedetti and his son, Matthew Benedetti sustained injuries after their vehicle was negligently driven and collided with a tree. Both father and son alleged that the son was driving. The Insurance Commission of Western Australia (ICWA) was the third party to the action and claimed that the father was driving and that as such it had no liability for his injuries.

The ambulance and hospital records and the evidence of nursing staff supported that the father was the driver and his son was the passenger.

There were also deficiencies in the expert evidence. The expert crash consultant had a strong view about the cause of the accident based on the crash dynamics but deferred to the medical expert as to whether the bruising indicated who was driving the vehicle.

The medical expert opinion, however, was based on photographs of the bruising only, as the expert had not been provided with the clinical notes of their treating GP. After cross examination, the medical evidence in relation to the seatbelt bruising was found to be equivocal which created doubt as to who was driving.

Further, after giving evidence in cross-examination to support his view on who was the driver, the GP’s evidence changed to the effect that he could not definitively confirm that the injury was caused by a seatbelt.

Given the inconsistencies in the father and son’s evidence, District Court Judge Stone was not persuaded that the father was the driver. The father’s claim against the son and the son’s claim against ICWA were dismissed.

This case highlights the need to scrutinise who was allegedly driving in motor vehicle accident claims and show how differences in expert evidence and inconsistent evidence can be fatal to a plaintiff's claim.

Benedetti v Benedetti [2017] WADC 103

Occupier’s liability

Slippery spillage still ‘speculative’

The Western Australia Court of Appeal has dismissed an appeal by a resident for damages in relation to injuries sustained when she slipped and fell in a common area of strata titled units in Reflections Waterfront Apartments. Ms Robinson alleged that she slipped on a stain on a tile in the common area and claimed damages from Reflections, alleging that Reflections was negligent as it breached its duty by not providing an adequate and reasonable cleaning regime, so as to prevent her fall.

His Honour District Court Judge Stone had dismissed Ms Robinson’s claim for damages as His Honour considered the cause of Ms Robinson’s fall to be ‘purely speculative’, as no evidence was bought regarding the composition of the stain, whether it was slippery or how it came to be on the tile. See our update here.

Ms Robinson appealed the decision to the Court of Appeal alleging that His Honour erred in finding that she failed to prove what she slipped on and what caused her to slip.  Ms Robinson also submitted that His Honour erred in fact and law in finding that Reflections had an adequate and reasonable cleaning regime in place at the relevant time, in finding that there was no breach of duty by Reflections and that a different inspection and cleaning regime would not have minimised or avoided her fall and injury.

The Court of Appeal found that Ms Robinson did not establish any error in His Honour’s finding that there was no evidence that the stain on the floor caused her to slip. Ms Robinson gave no evidence on appeal that the stain she observed was wet, oily, greasy or that she had otherwise observed the presence of any other substance of a slippery nature.

It was concluded on appeal that the mere fact that she fell in the vicinity of a discolouration on a tile did not give rise to a ‘reasonable and definite inference’ that this part of the floor had a slippery substance on it when she fell. Accordingly, the Court of Appeal found that there was an ‘evidentiary vacuum’ regarding the cause of Ms Robinson’s fall.

This case reaffirms that the plaintiff has to, on the balance of probabilities, establish causation for a claim in negligence and the court will not simply draw an inference as to what caused an accident in the absence of clear evidence.

Robinson v The Owners of Reflections Waterfront Apartments West Tower Strata Plan 58085 [2017] WASCA 190

Property agent landlord and occupier liable for collapsed balcony

The New South Wales Court of Appeal has allowed an appeal from a District Court finding that a property agent was liable for a collapsed balcony, in circumstances where the property landlord and occupiers were not.

Deepak Bhide and Alka Bhide (owners) owned a property in Collaroy, NSW. The owners appointed Libra Collaroy Pty Ltd trading as Elders Real Estate (property agent) to manage the property pursuant to an Exclusive Management Agency Agreement (rental agreement). In November 2005, the owner entered into a tenancy agreement with primarily, Ms Joanne Gillies, an architect (occupier).

On 15 June 2012, the balcony collapsed due to the deterioration of structural beams and metal fixings. Four children were injured when the balcony collapsed. The children, including one of Ms Gillies’ children, commenced proceedings and sought damages for personal injuries. Ms Gillies, as the fifth plaintiff, sought damages for a purely psychiatric injury.

In the years preceding the collapse of the balcony, a number of issues were raised by the occupier regarding significant rot that was evident in the balcony’s supporting beams. Four years prior to the collapse, in 2008, a carpenter attended the property and provided a quote to replace the decking boards and build a pergola over the deck. Concern over the state of the beams continued and was communicated by the occupier to the property agent.

At first instance, the court found that the property agent was negligent and solely liable to the owners and the occupier and that the owners were liable to the occupiers for breach of contract, being the breach of the rental agreement. It was also found, however, that the owners were entitled to a contractual indemnity from the property agent in respect of damages owed to the occupiers for breach of the rental agreement.

The appeal brought by the property agent comprised of seven grounds. Notably, the property agent did not appeal the finding that they were negligent but took issue with the fact that the owners and the occupiers were not found to be joint tortfeasors. The property agent also disputed that the owners were entitled to an indemnity from the property agent for breach of the rental agreement.

The Court of Appeal considered that the owners were liable to the plaintiffs and should bear some responsibility for the collapse and associated injuries, as the owners of the property made a gain from it and were in a position to carry out the repairs. The Court of Appeal found that the owners had breached their duty of care by failing to take the degree of care that a reasonable person in their position would be expected to take, having regard to the knowledge they had concerning the structural integrity of the building.

The Court of Appeal also found that the occupier had breached her duty of care, by failing to prevent access to the balcony. As a tenant of seven years, the occupier had knowledge of the structural problems and should have prevented people on her property from entering the balcony.

While the Court of Appeal upheld that the owners were entitled to a contractual indemnity for breach of the rental agreement, however, reduced their indemnity by 30% due to contributory negligence as they had failed to take the degree of reasonable care that an ordinary person with the knowledge of the history of the lack of structural integrity of the balcony would have taken. The occupier was ordered to contribute 20% to the plaintiffs’ damages as she should have refused anyone access to the balcony until its structural integrity had been investigated.

This case illustrates that a property agent, owner and an occupier cannot discharge a duty of care by delegating to one another. Each party must take responsibility to ensure that they are doing everything within the scope of their respective duties of care to make the property, and people on the property, safe.

Libra Collaroy Pty Ltd v Bhide [2017] NSWCA 196

Medical malpractice

Contingency discount applied to wrongful birth claim

The District Court has applied a contingency discount to a wrongful birth claim on the basis that the plaintiff conceded that she did intend to have children later in her life.

Ms Stobart attended on her general practitioner and requested that a birth control implant be inserted into her arm. Ms Stobart was unaware that she was pregnant at the time and subsequently discovered she was pregnant but was advised that she was too far advanced in the pregnancy to have the foetus terminated.

Ms Stobart alleged that her general practitioner was negligent in failing to ensure that she was within the first five days of her menstrual cycle at the time of inserting the device. She claimed damages associated with the cost of raising a child, as has been accepted following the High Court’s decision in Cattanach v Melchior.

The evidence of the doctor, in reliance on her clinical records, was that Ms Stobart had advised that she was on her menstrual cycle and that she had offered to perform a pregnancy test but that Ms Stobart refused. District Court Judge Levy did not make a finding of negligence, accepting the evidence of the doctor over that of Ms Stobart as he found her to be an unreliable witness with credibility issues.

In coming to that conclusion, Judge Levy took into account that the worker had not disclosed a prior history of drug use in a new patient questionnaire she had completed some years previously and had provided inconsistent evidence about her alcohol and cigarette use at trial.

Judge Levy went on to consider the issue of damages and advised that he would have applied a contingency discount of 10% to that award as the worker was 23 years of age at the time of her pregnancy and conceded that she intended to have children when she reached her 30s.

This is an interesting development following the Cattanach decision which suggests that a contingency discount to an award of damages will be made in a wrongful birth claim in circumstances where the plaintiff is unable to establish that she did not intend to have children at all. It remains to be seen whether this decision will withstand scrutiny at a higher level.

Stobart v Al-Hakeem [2017] WADC 127

General liability

Third party ordered to contribute to damages for injury caused by ‘substantial and overwhelming’ negligence of another

The District Court of Western Australia has found that Harvey Norman should contribute 25% of the judgment sum paid to a plaintiff injured by another while collecting goods from its warehouse.

Mr Gallagher was injured on 13 January 2015 while picking up goods from Harvey Norman. Mr Gallagher and a Harvey Norman employee were in the process of loading Mr Gallagher’s vehicle, which was parked in the common access way. While Harvey Norman had a designated loading bay, Mr Miloradovic’s truck was blocking access to it. Mr Miloradovic, who had just completed a delivery to another business in the complex, reversed his truck but failed to keep a proper look out and Mr Gallagher was pinned between the two vehicles.

Accepting that his negligence had caused the injury, on 2 May 2016 Mr Miloradovic consented to judgment being entered against him in the sum of $865,000. However, he also alleged that Harvey Norman owed a common law duty of care, and statutory duty of care under the Occupiers’ Liability Act 1985 (OL Act) and Occupational Safety and Health Act 1984 (OSH Act) to Mr Gallagher which they had breached, and accordingly sought a contribution to the judgment amount. Harvey Norman denied that it owed a relevant duty of care to Mr Gallagher; and further denied it breached any duty it did owe, alleging that the injury had been solely caused by Mr Miloradovic’s ‘negligent and reckless’ conduct.

Judge Stevenson found that Harvey Norman did owe Mr Gallagher a duty of care at common law, as he was its customer and it had directed him to the loading bay to collect his goods. His Honour also considered that Harvey Norman had breached this duty, as the risk to Mr Gallagher in the circumstances was foreseeable and not insignificant, and ‘any reasonable store owner… would, in the circumstances, have taken some precautions against the risk’ of a potentially serious injury.

He considered it highly relevant that Harvey Norman’s franchisor had provided the business with a traffic management plan immediately after the incident which, had it been implemented prior, would have minimised the risk of Mr Gallagher being injured.

Further, his Honour was satisfied that Harvey Norman’s breach had caused Mr Gallagher's injury, as there was a ‘real and substantial possibility’ that but for the breach, Mr Gallagher might not have been injured, notwithstanding the negligence of Mr Miloradovic. Finding that Mr Miloradovic’s negligence was ‘substantial and overwhelming, but… not absolute’, he apportioned 25% of the liability to Harvey Norman.

As a sidebar, his Honour did not consider that Harvey Norman owed any statutory duty of care in the circumstances, as the access way where the accident occurred was not ‘controlled’ by Harvey Norman for the purposes of the OL Act, and nor could it be considered a ‘workplace’ under the OSH Act. Even though there was no statutory duty, in the context of a common law duty being owed, this lack of control emphasized the onus on Harvey Norman to implement appropriate safeguards to protect its customers in this area.

This case serves to highlight an occupier’s duty of care to third party employers to provide a safe place of work and safeguard against foreseeable risks. Parties may be exposed to a finding of liability even where another tortfeasor’s negligence is overwhelming, and even where an injury occurs in a common area over which they may not have control.

Miloradovic v Osborne Park Commercial Pty Ltd [2017] WADC 129


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