July 2017

Asbestos Case notes

Not many cases run to judgment in the Dust Diseases Tribunal. However, in recent weeks there have been two decisions, one of which lays down what could be regarded as new guidelines in relation to the payment of interest, while the other one of which again addresses the difficult issue of general damages for mesothelioma.

Repayment of interest when challenging a CAD

In Jaron Holdings Pty Limited v Amaca Pty Limited [2017] NSWDDT 4, the plaintiff, Robert Hall, sued Jaron Holdings, which settled Mr Hall’s claim for $1,385,000 inclusive of costs.

Jaron then brought proceedings for contribution against Amaca. The recovery claim duly proceeded to a contributions assessment determination (“CAD”), which allocated 47.1% to Jaron and 52.9% to Amaca. Amaca duly paid Jaron 52.9% of the original settlement, simultaneously advising Jaron that it intended to contest the CAD.

Amaca then served an Offer of Compromise, offering to accept a verdict from Jaron, with each party to pay its own costs. The covering letter of the Offer of Compromise also made a claim for repayment of interest on the money Amaca had paid to Jaron.

Jaron eventually agreed to give Amaca a verdict, but contested the liability for interest, which therefore became the central issue in the present hearing. Amaca argued that it should be entitled to interest pursuant to the general law of restitution i.e. that it had not had the benefit of the money after it had paid the principal sum to Jaron.

For its part, Jaron argued that such an approach would be to adopt unjust enrichment.

However, Judge Russell held that the question of Amaca being “unjustly” enriched did not really arise; the simple fact was that Amaca had not had the benefit of its money for nearly five years.

Therefore, the judge held that Amaca was entitled to recover interest of $214,804.48 from Jaron Holdings for the full period in which Jaron had held Amaca’s funds.

Comment: This is a relatively unusual case on the facts, in that the primary claim settled for an amount which was much higher than is the case with most asbestos claims. Further, the judgment does not really explain why the recovery proceedings apparently remained stationary for five years. However, the decision shows a clear imperative on a recovering party to keep its recovery proceedings moving.

The judgment also shows the risk involved for a recovering cross claimant if it obtains money from a cross defendant pursuant to regulation 56 orders, but then fares worse than the CAD in subsequent litigation brought by the cross-defendant. A cross-claimant should not let a matter languish after the cross-defendant pays its contribution pursuant to regulation 56 orders, but should instead keep pressing the cross-defendant for finalisation by way of consent judgment.

General damages and domestic care

In Zanetic v Amaca Pty Limited [2017] NSWDDT 5, the plaintiff was a carpenter who was exposed to James Hardie products, including Hardiflex, Hardiplank, Tilux and Super Six corrugated sheets. He said he was never warned of the dangers, and Judge Russell had little trouble finding for the plaintiff.

The plaintiff had suffered chronic lymphocytic leukaemia (“LLC”) for many years. After careful examination of the available evidence (and noting that not all of the relevant evidence had been put to the medico-legal doctors) the judge concluded that the plaintiff probably “only” suffered from LLC until the mesothelioma was diagnosed in 2016.

The plaintiff underwent three rounds of chemotherapy, and was in and out of hospital with various respiratory complaints, not all of which were apparently attributable to the asbestos exposure.

The plaintiff was born on 29 May 1939, so was 78 at the time the judgment was delivered on 7 July 2017. Judge Russell awarded general damages of $350,000.

In relation to domestic care, the first period of care was provided by the plaintiff’s partner, who did not give evidence at the hearing, and accordingly the judge made no allowance at all for that period.

For the next period, the plaintiff’s daughter Audrey said that she was providing the plaintiff with five hours a day of active care, but, in effect, was available to her father virtually 24 hours a day. Audrey was cooking meals and generally looking after the plaintiff, and in fact gave up her employment to do so. Judge Russell found that, even though Audrey may not have been providing active care to her father throughout the day, his condition meant that she basically had no alternative but to be continually present.

Accordingly, the judge awarded domestic care at 20 hours per day, noting that Audrey occasionally left the house to drive her son to school and perform other tasks. Judge Russell considered whether some of this care should be allowed at lower than the statutory rate of $29.77 per hour, but found no justification for doing so.
Overall, this produced a judgment of $455,007.54, plus costs.

Comment: Judge Russell is the most recent appointment to the bench of the Dust Diseases Tribunal. His judgment on general damages of $350,000 is higher than the judgments handed down in late 2016 by other judges of the Tribunal.

Of course, every assessment of general damages turns on its own facts; here, the plaintiff was relatively young, and had three cycles of chemotherapy. In relation to domestic care, it is noteworthy that Judge Russell applied the statutory rate to all such care, rather than exploring the idea of “passive and active rates”, as was considered in Perez v State of NSW [2013] NSWDDT 7 (not disturbed on that point on appeal).

It is very early days in Judge Russell’s career on the bench. It remains to be seen if this judgment indicates that he will adopt a generous approach to damages generally, or whether the upward drift in general damages, which many defendants’ lawyers have long assumed would soon be the case, has finally arrived.

Either way, this judgment will cause all defendants at least some degree of concern.

For further enquiries, contact David Greenhalgh.

Author: David Greenhalgh