Worker Awarded Damages for Mesothelioma Caused by Employer

The Dust Diseases Tribunal awarded damages to the claimant for mesothelioma caused by exposure to asbestos while employed by the respondent. The Tribunal found the respondent liable for damages based on the claimant's employment and subsequent illness.

Dust Diseases Tribunal New South Wales Medium Neutral Citation: [NAME] v [COMPANY] [2016] NSWDDT 5 Hearing dates: 26 September 2016, 21 October 2016, 5 December 2016 Date of orders: 13 December 2016 Decision date: 13 December 2016 Before: KEARNS J Decision: Verdict and judgment for the plaintiff in the sum of $340,622.64. Catchwords: DUST DISEASES; mesothelioma; damages; liability; whether the plaintiff employed by [COMPANY] or by its subsidiary company Cases Cited: CSR Limited v Wren (1997) 44 NSWLR 463 Category: Principal judgment Parties: [NAME] as the Executrix of the Estate of the [NAME] (Plaintiff); [COMPANY] (formerly known as [COMPANY]. [PHONE]) (Defendant) Representation: Counsel: [redacted]

Solicitors: [redacted] File Number(s): DDT 144/2016

Judgment

Outline 1. [NAME] contracted mesothelioma. He sued the defendant for damages. He died of his illness on 25 October 2016. His wife and executrix of his Estate has been substituted as the plaintiff.

Issues 1. There are only two questions on the issue of liability.

1. Was [NAME] employed by [COMPANY]? The issue here is whether he was employed by [COMPANY] ([NAME]) or by [COMPANY]. It is common ground that [COMPANY] became a wholly owned subsidiary of [NAME] in 1968. It remained a separate corporate entity;

2. If not, did [NAME] nevertheless owe the plaintiff a duty of care akin to that of an employer? – CSR Limited v Wren (1997) 44 NSWLR 463.

1. If either question is answered 'yes', the plaintiff must succeed in the proceedings with damages to be assessed.

Was [NAME] employed by [NAME]? 1. [NAME] worked at premises at [ADDRESS], [NAME] (the [NAME] site) from about mid 1975 to about 1977. He worked as a supervisor and forklift driver. There was conducted at the [NAME] site a very large and busy transport and storage operation.

2. There was testimonial and documentary evidence given in this case.

3. The testimonial evidence consisted of oral evidence from the plaintiff and [NAME], an affidavit of the plaintiff and statements of [NAME] and [NAME]. There was also a statement of [NAME] going to the issue of damages. These, [NAME] excepted, were all persons who worked at the [NAME] site at or about the same time as the plaintiff. They and the plaintiff all had the same employer. Some said they were employed by [COMPANY], others by [NAME] and others did not know. Some gave evidence pointing to [COMPANY] as the employer and others pointing to [NAME].

4. In his evidence, [NAME] said he heard all the people talking about [NAME]. I do not regard that as evidence of the fact. [NAME] said his boss was [NAME]. He was the manager of the yard. He was out there all the time. Mr [NAME]'s boss was [NAME]. He ran the office. [NAME] was over [NAME]. Black Bart, later in evidence identified as [NAME] from Melbourne, seemed to "run the lot" (T3.45). 5. [NAME] had a uniform with the name "[NAME]" on it. That name changed to "[NAME]" (T5.09). 6. [NAME] gave evidence at his residence at Mollymook. An undated statement of [NAME] was admitted into evidence (Exhibit PX 4). Much of the material in his statement did not advance the issue as it was limited to the evidence of his belief. I do not rely on that. In his statement, he said that [NAME] ([NAME]) had a name change to [NAME] in about 1977. Despite the name change, everything else remained the same. 7. [NAME] was initially employed to operate the road patrol vehicles. They serviced the [NAME] trucks and drivers (Exhibit PX 4 [8]). They displayed the names [NAME] and [NAME] (Exhibit PX 4 [8]). 8. [NAME] was promoted to being the operations manager of New South Wales for [NAME] (later [NAME]). As operations manager, he worked with the following managers at [NAME]: [NAME]. 9. [NAME]'s time at [NAME], the senior and middle management kept a contact book. It contained the names and contact details of management persons of [NAME] and [NAME]. 10. [NAME] became general manager at the [NAME] depot when [NAME] died in 1975. That was a time of low staff morale and [NAME] had concerns about Mr [NAME]'s ability to manage the [NAME] depot. His concern led him to ringing [NAME] in Melbourne. He obtained [NAME]'s contact details from the contact book. [NAME] was listed in the contact book as the person in charge of [NAME] and the rest of [NAME] road transport division. Following that call, there was a change of management of [NAME]. [NAME] was transferred from another division of [NAME], Seaway, its shipping arm, and was brought into [NAME] at [NAME] to replace [NAME].

11. In cross-examination, [NAME] agreed he was employed by [COMPANY]. The [NAME] site was the depot for [NAME]. [NAME] had an operation elsewhere. [COMPANY] had its own general manager. It had a financial director, [NAME], at [NAME]. It had senior staff at [NAME]. [NAME] said he never worked for [NAME], or at least, that was the effect of his evidence (T16.50). He did not know of the arrangements between "[NAME]" (T17.05). 12. [NAME] provided a statement – [NAME], Vol 2, 509. He said he worked for [NAME]. That evidence is of little utility because he speaks generally of [NAME]' structure and practices with regard to different business divisions of [NAME]. He did not cover [NAME] or [COMPANY]. 13. [NAME] provided a statement – [NAME], Vol 2, 523. He worked for the business at the [NAME] site and said he was employed by "[NAME] which was a subsidiary owned and operated by [COMPANY]". There was a name change to "[NAME]" in the 1970s. Business continued in the same way. He recalls the name "[NAME]" displayed indicating it was a subsidiary of [COMPANY]. He recalls payslips in a [NAME] envelope with "[NAME] a subsidiary of [COMPANY]" printed on the pay packet. [NAME] had its own service vehicles for trucks on the road. The vehicles had "[COMPANY]" branding on them. They serviced "a number of the [COMPANY] subsidiaries, including [NAME]…". 14. [NAME] provided a statement – Exhibit DX 1, tab 6. He said he was employed by [COMPANY] in the 1970s. Dockets contained the name " '[NAME]' or '[COMPANY]' on them with 'MN' (for [NAME])". He had never heard of "[NAME] trading as [NAME]". At this point, I note that it did as is demonstrated by documents later referred to. 15. [NAME] provided two statements – Exhibit DX 1, tab 4; [NAME], p 505. In the first statement, he stated he was employed by a number of [COMPANY] activities or subsidiaries from 1962 to 1994. His employer was always the activity or subsidiary he was working for. He said he was employed by [COMPANY] from August 1977 for approximately 18 months. In his second statement, he indicated that where in the first statement he was referring to [COMPANY], he was referring to [NAME]. He said [COMPANY] was never known as "[NAME] trading as [NAME]". [COMPANY] had its own general manager, financial director and other senior staff. 16. [NAME] provided a statement – Exhibit DX 1, tab 5. He said he was employed by [COMPANY] from 1963/4 to 1976. He was paid by it. There were no signs or documents referring to "[NAME] trading as [NAME]". 17. [NAME], who appeared with Mr [NAME] for the plaintiff, submitted that the testimonial evidence should yield to the documentary evidence in this case and the evidence overall, especially the documentary evidence, leads to the conclusion that [NAME] was employed by [NAME]. I agree with both those points.

18. There are reasons why the testimonial evidence should yield to the documentary evidence. The first is that the events in issue occurred 40 years ago and memories may not be clear or correct. The second is that the events are essentially of a corporate nature and not matters the witnesses would be expected to be intimately aware of or even have much knowledge of. The third is that the events being of a corporate nature, the contemporaneous records and public records are likely to record accurately what eventuated.

19. I turn to the documents. * [COMPANY] changed its name on 12 September 1974 to [NAME] No. Fifteen ([NAME]) Pty Limited ([NAME]) – [NAME], Vol 3, 949. * The activities of [COMPANY] in the year ended 30 June 1973 were reported by the directors in the directors' report to be "TRANSPORT AND STORAGE" " – [NAME], Vol 2, 867. That is consistent with the testimonial evidence that that was the business being operated at the [NAME] site. * That continued to be the described activities in the year ended 30 June 1974 – [NAME], Vol 2, 894. * In the year ended 30 June 1975, that changed. The directors' report for [NAME] for the year ended 30 June 1975 recorded the principal activities as "Non-operating changed from Transport & Storage" – [NAME], Vol 2, 906. Consistent with the change of name, the directors' report was for [NAME]. It is clear from this document that the operations of [COMPANY] changed during the year ended 30 June 1975 from an active transport and storage business to "The principal activities" being "non-operating". It is clear, therefore, that [COMPANY] (later known as [NAME]) ceased to operate the transport and storage business at the [NAME] site. The oral evidence is clear that there was no change in the operations or in the busyness of the operations at the [NAME] site at this time or thereafter.

Accordingly, some entity continued to conduct the transport and storage business. * That non-operating mode for [NAME] continued through to 1979 – [NAME], Vol 2, 933; Vol 3, 973, 994 and 1016. In the last few years, the activities item was described as "[NAME]". * Consistent with a change in the description of the company's activities was a substantial drop in the trading profit of the company when the activities were changed to non-operating. The profit and loss statement for [NAME] for the year ended 30 June 1975 reveals a trading profit of $287,407 for the year ended 30 June 1974 and $1,711 for the following year – [NAME], Vol 2, 911. This is consistent with the company changing from transport and storage operations in the 1974 year to non-operating in the 1975 year. Further, the operations at the [NAME] site continued without interruption through those years. Somebody must have been carrying them out. It was not [NAME]. * Exhibit PX 1, Vol 2, 965 comprises a profit and loss statement for [NAME] for the year ended 30 June 1977. It shows a trading profit of $10,408 for the 1976 year and $12,032 for the 1977 year. The defendant submits this shows it was operating and trading. I do not accept that submission at least for the force that the defendant seeks to obtain from this evidence. As indicated earlier, this company went from being a transport and storage company to a non-operating company in the year ended 30 June 1975. The drop in trading profit was consistent with that. The trading profit never came back to anything like what it was when the company was operating as a transport and storage business despite that business continuing as it always had. Further, a directors' report for the year ended 30 June 1977 records the principal activities as "[NAME]" – [NAME], Vol 2, 973. Trading profits of $10,408 and $12,032 are more consistent with rents or interest received rather than with earnings from operating a transport and storage business. * Also consistent with a change in the company's activities are records showing that the company had employees up to the year ended 30 June 1973. The balance sheets for [COMPANY] for the years up to 30 June 1973 reveal provision for employee leave and retirement benefits. In the year ended 30 June 1974, that dropped to nil. Though the activities of the company changed and the trading profit dropped dramatically in the year ended 30 June 1975, the elimination of employee benefits in the year ended 30 June 1974 is consistent with that. This is because the company may have shed itself of employees at or near the end of the 1974 financial year. That continued through to the year ended 30 June 1979 – [NAME], Vol 2, 889, 912, 926; Vol 3, 966, 986, 1008. This is consistent with the company no longer having employees and with the change in stated principal activities and the substantial drop in trading profits.

1. These are the principal documents the plaintiff relies on. They present a compelling case that from the year ended 30 June 1975, [NAME] (formerly known as [COMPANY]) was not operating the business at the [NAME] site. The plaintiff also relies on other documents. I shall come to them.

2. Before doing so, I turn to documents relied on by the defendant. * A letter of 31 August 2016 from State Insurance Regulatory Authority discloses that [COMPANY] A.B.N./A.C.N. 56 [PHONE] was insured under a workers' compensation insurance policy by [NAME] in two periods being 1972 to 1977 and 30 June 2011 to 30 June 2017. This document is unreliable for two reasons: 1. [COMPANY] changed its name to [NAME] on 12 September 1974. It is most unlikely that renewals of this policy would have continued under the name of [COMPANY] up to 1977; 2. even more compelling is the cover for the period 30 June 2011 to 30 June 2017. The A.B.N./A.C.N. reveals this is the same insured company. There cannot be a policy for that company in that period. [NAME] (formerly known as [COMPANY]) was wound up on 13 March 1985 – [NAME], Vol 3, 1173. The company did not exist in that period. No reliance can be placed on this document; * A record in the annual return of [NAME] for the year ending 30 June 1976, identified [NAME] as being a subsidiary of [NAME] carrying on business in Australia – [NAME],Vol 2, 579. This is a note being Note 19 to the balance sheets as at 30 June 1976 of [NAME] and subsidiary companies – [NAME], Vol 2, 572, 579. It reveals [NAME] as carrying on business in Australia. That has to be read with other documentary material revealing that its principal business in that year was non-operating and in the following year, [NAME]. It also has to be read with the documentary evidence that the balance sheet for [NAME] for that year revealed nil allowance for employee benefits. Further, this note does not say what business was carried on by [NAME]. There is nothing to indicate it was a transport and storage business at [NAME]. Much the same comments may be made in relation to the documents at [NAME], Vol 2, 611.

1. I do not think there is anything in these documents to detract from the force of the plaintiff's submissions.

2. Other documentary material comprised: * Victorian Government Gazette of 11 August 1976 contained a notice of an application by [NAME] to operate warehouses in sites in Victoria. [NAME] was described in the notice as a unit of [COMPANY] [NAME], Vol 2, 615; * New South Wales Government Gazette of 18 and 25 August 1978 contained two notices of petitions to wind-up companies. The petitioner in both cases was "[COMPANY] trading as [NAME]" – [NAME], Vol 2, 617, 620. Here are two instances of litigation in the Supreme Court of New South Wales with one of the parties describing itself as operating under a trading name which had no indicia of incorporation. The inference is available that [NAME] was using [NAME] as a trading name. It was not trading as [COMPANY] it were trading as that entity, one would expect it to be described by its corporate status and, perhaps more significantly, by its then name which was [NAME]; * [NAME] at Vol 2, 501 is a letter on letterhead of "[NAME]". This is dated 27 October 1975. The letterhead includes a number of addresses including head office at 30 Sir Joseph Banks St, [NAME] and that address also being one of the depot addresses. It is a letter supporting [NAME]'s application to the Commonwealth Bank for a loan. It describes him as "an employee of this company". It is signed by [NAME] as general manager of [NAME]. It has a footer being "Unit of [COMPANY]. (Inc. in Vic)". It may be drawn from this document, and I do, that [NAME] used [NAME] as a name in which to trade. The only "company" of which [NAME] could have been an employee was [NAME] because, as has just been seen, [COMPANY] at this time did not exist under that name, but under the name [NAME], and [NAME] had gone into a non-operating mode. The defendant also relies on this letter. It relies on the statement that [NAME] has been "an employee of this company" and says that must be [COMPANY]. Of itself, that phrase is ambiguous. It needs context to establish its meaning and I have dealt with that. The defendant also submits that the document is signed by [NAME] and he was not employed by [NAME], but was the general manager of [COMPANY] and employed by it. I do not think that can be so as, by then, provision for employee benefits and employees had been moved out of [NAME]. Also contrary to the defendant's submission here is the fact that [COMPANY] had changed its name to [NAME] in September 1974. It is unlikely that [NAME] would, in that situation, be putting his signature to a letter from a company and using a company name which no longer existed and had not existed for over 12 months. * A staff newsletter of 17 December 1975 under the logo of "MN" with the words "THE [NAME]" written through the letters "MN", reported the death of [NAME], general manager of [NAME]. It was signed by [NAME], managing director of both [NAME] and [COMPANY] [NAME], Vol 2, 502.

1. The defendant has not produced any documentary material that diminishes the case made by the plaintiff.

2. I said earlier that [NAME] was not operating the business at the [NAME] site from at least the year ended 30 June 1975. Some entity must have been. The only available organisation was [NAME]. It is acknowledged that if this be the correct finding, there must be a verdict for the plaintiff.

Damages 1. This Tribunal and indeed all those who practise in it are very familiar with the disease mesothelioma and its impact on its victims. The result of this is that for some time now detailed evidence about the painful and harrowing effects the disease has on a victim is rarely, if ever, tendered. Without intending to belittle in any way the consequences for [NAME] of the contraction of the disease in this case, Mr [NAME], who appeared for the defendant, submitted that this was a conventional mesothelioma case. I think that understates it.

2. In addition to symptoms commonly associated with the disease, [NAME] had other symptoms and a regime of treatment not undertaken in all cases. He underwent nine cycles of chemotherapy with side effects including lethargy and dry mouth. He developed pneumonia in December 2015 and was hospitalised in January 2016 for three days. He was very unwell at home after discharge. He was re-admitted to hospital shortly thereafter with worsening cough and shortness of breath. He commenced a second line treatment in April 2016 and was administered Keytruda. Side effects included excessive phlegm production and a dry mouth.

3. He had multiple admissions to hospital. His symptoms included shortness of breath, right sided chest pain, pleural effusion, weight loss, cough, pleural thickening, sleep disturbance, anxiety attack.

4. On 19 September 2016, [NAME] noted significant muscle wasting and frailty – [NAME], Vol 3, p1389.

5. When [NAME] gave his evidence, he was seated in a recliner chair under a blanket. He was on oxygen. He looked grey and appeared somewhat wasted.

6. I think in the circumstances, a reasonable assessment for damages is $300,000.

7. I think it is reasonable to allow interest for two years and I allow $12,000. I have allowed interest for two years rather than 797 days as claimed by the plaintiff.

8. I think it is reasonable to allow interest up to the date of death. From the date of death to date, I allow interest as claimed in the sum of $2,416.44.

9. I allow $12,000 for loss of expectation of life.

10. The plaintiff makes a claim for past gratuitous care in accordance with the following schedule. Period Type of care Rate Calculation 1 April 2016 to 3 June 2016, a period of 9 weeks or 64 days: 6 hours per week Personal care and domestic assistance provided by [NAME] 29.41iii 6 x 29.41 x 9 =1,588.14 [NAME], Vol 2, p521 [4] 4 June 2016 to 11 June 2016, a period of 1 weeks or 7 days: 14 hours per week Personal care and domestic assistance provided by [NAME] 29.41 14 x 29.41 x 1 = [NAME], Vol 2, p521 [5] $411.74 12 June 2016 to 12 September 2016, a period of 13 weeks or 93 days: 6 hours per week Personal care and domestic assistance provided by [NAME] 29.41 6 x 29.41 x 13 weeks = [NAME], Vol 2, p521 [4] $2,293.98 13 September 2016 to 21 September 2016, a period of 1 week or 9 days: 14 hours per week Personal care and domestic assistance provided by [NAME] 29.41 14 x 29.41 x 1 week = [NAME], Vol 2, p521 [6] $411.74 22 September 2016 to 25 October 2016, a period of about 5 weeks or 34 days: 63 hours per week Personal care and domestic assistance provided by [NAME] and [NAME] [sic] 29.41 63 x 29.41 x 5 = [NAME], Vol 2, p521-2 [7]-[11] $9,264.15

iii [NAME], Litigation Tables 2016 The highlighted references are references to the evidence supporting the claim.

1. I consider this is reasonable and I allow $13,969.75.

2. I allow interest on past gratuitous care from April 2016 to the date of death (six months) in the sum of $140.00. I allow further interest as claimed from the date of death in the sum of $96.45.

3. Summary of figures Non-economic loss $300,000.00 Interest $14,416.44 Loss of expectation of life $12,000.00 Care $13,969.75 Interest $236.45 TOTAL $340,622.64

result 1. Verdict and judgment for the plaintiff in the sum of $340,622.64.

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