Walker v Newlands Northern Underground Mine – a new method of calculating economic loss?

Walker v Newlands Northern Underground Mine – a new method of calculating economic loss?

19 November 2019 Topics: Insurance, Workers’ compensation

In Walker v Newlands Northern Underground Pty Ltd [2019] QSC 96, Justice Crow calculated future economic loss by discounting a discounted figure. Will this novel approach become the norm in Rockhampton?

Key facts

Mr Walker sustained a significant laceration to his right hand on 7 April 2013 while working as an underground miner at the Newlands mine. He had worked there since 13 July 2011.

After the injury, Mr Walker planned to go to his doctor. However, the mine coordinator called him in for suitable duties and he was placed back underground where his hand became infected.
Mr Walker subsequently developed a neuropathic pain disorder and a psychological injury.

At the time of trial, Mr Walker was 32 years of age.

The employer admitted liability in full after the close of evidence.

Employer’s arguments

The employer’s primary quantum arguments were that Mr Walker did not have any:

  • psychological injury or, if he did, it was related to his marital breakdown, his lawful redundancy and other personal stressors
  • chronic pain or neuropathic pain condition

Credit and causation

In a lengthy judgment, Crow J analysed the evidence and relevantly concluded that Mr Walker:

  • was a very credible witness, evidenced by his efforts to return to work post-incident and willingness to report improvements in his condition
  • had some neuropathic pain, but did not have a chronic pain syndrome
  • had sustained a psychological condition as a direct consequence of the work incident

Deed of release

Although it became a moot point (as Crow J found that Mr Walker’s psychological condition was a direct consequence of the work incident), His Honour also made noteworthy comments about the relevance of a deed of a release.

The employer made a secondary argument that Mr Walker could not claim for any psychological injury caused by the redundancy given a deed of release ‘could not be relitigated’.

Crow J rejected that argument, finding (at paragraphs [76]-[77]) that the deed of release was limited to those matters specifically contemplated by the parties – i.e. the unfair dismissal claim – and therefore could not be pleaded as a bar to the subject claim.

Quantum assessment

Crow J assessed quantum at $999,506.50 clear of WorkCover statutory refund ($109,389.50).

Past economic loss

Crow J allowed Mr Walker’s approximate pre-incident base rate of $2,000 net per week from the date of incident to trial (293 weeks), less actual earnings, reduced by 25% on the basis there was no guarantee Mr Walker would have immediately obtained other mining work.

Future economic loss

By reference to Kovan v Hail Creek Coal [2011] QSC 051, Queen’s Counsel for Mr Walker claimed:

  • $1,200 net per week (being theoretical income of $2,200 less $1,000 actual earnings) to age 60, discounted by 20% for contingencies
  • $1,200 net per week from age 60 to 67, discounted by 50% for contingencies.

Crow J agreed with that mathematical approach, but discounted the consequent sum by a further 33% on the basis that Mr Walker was no certainty to continue working in the mines for a further 35 years and having regard to Mr Walker’s non-compensable neck injury. (The neck injury was sustained while holidaying in Bali and assessed by Dr Labrom as having a 0% WPI.)

Conclusion

It seems unlikely that this approach will become the norm in Rockhampton.

Crow J appears to have applied this high level of discounting – despite finding Mr Walker to be a very credible witness – to take into account that Mr Walker had only worked in the mines for a relatively brief period before the incident and any calculation that assumed he would have remained in that highly lucrative work for a further 35 years needed to be significantly discounted.

Although there were some similarities between Mr Walker’s claim and Kovan’s case, Crow J’s quantum assessment in this case ultimately serves as a reminder that every case must be determined on its own facts.

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