FEDERAL COURT OF AUSTRALIA

Zaghloul v Woodside Energy Ltd [2014] FCA 1262

THE COURT ORDERS THAT:

1.    The applicant’s application in WAD 308 of 2014 for leave to appeal from the decision of Gilmour J made on 26 September 2014 be refused.

2.    The applicant’s application in WAD 310 of 2014 for leave to appeal from the decision of Gilmour J made on 26 September 2014 be allowed.

3.    The applicant in WAD 308 of 2014 and the respondent in WAD 310 of 2014 pay the costs of the applications, to be taxed if not agreed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

THE COURT ORDERS THAT:

1.    The applicant’s application in WAD 308 of 2014 for leave to appeal from the decision of Gilmour J made on 26 September 2014 be refused.

2.    The applicant’s application in WAD 310 of 2014 for leave to appeal from the decision of Gilmour J made on 26 September 2014 be allowed.

3.    The applicant in WAD 308 of 2014 and the respondent in WAD 310 of 2014 pay the costs of the applications, to be taxed if not agreed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

1    On 26 September 2014, in one set of reasons, a judge of this Court dismissed Dr Zaghloul’s interlocutory application for summary judgment on his claim for damages for personal injury (Zaghloul v Woodside Energy Ltd (No 5) [2014] FCA 1042).

2    His Honour also dismissed in part Woodside’s amended interlocutory application of 9 May 2014 seeking summary judgment against Dr Zaghloul. However he allowed Woodside’s application to summarily dismiss so much of the personal injury claim that depended on s 52 of the Trade Practices Act 1974 (Cth) (TPA).

3    Each of the applications was based on s 31A of the Federal Court of Australia Act 1976 (Cth) and r 26.01 of the Federal Court Rules 2011 (Cth).

4    Each party applies today for leave to appeal the decisions.

5    I will briefly deal with each of the applications in turn.

DR ZAGHLOUL’S APPLICATION FOR LEAVE TO APPEAL

6    Dr Zaghloul points to a number of documents which he says made it clear that he should have judgment now without the need for a trial. The primary judge focussed on two documents and while Dr Zaghloul complains that he has ignored others, the reality is that they are all in a similar category, as I will explain. Dr Zaghloul pointed to a passage in a letter of 31 January 2013 from Woodside which was in these terms:

As you may be aware, Woodside is self-insured for the purposes of worker’s compensation. This formal notice is a requirement under the statute.

With reference to this claim you are notified that liability is accepted for anxiety and/or depressive disorder causing total incapacity for work with effect from 13 April 2011 resulting from unsatisfactory management of your work performance.

(emphasis added)

7    Dr Zaghloul argued before the primary judge that the latter sentence was clearly an admission of liability in respect of his claim.

8    His Honour disagreed, but in any event, was not prepared to reach that conclusion on a summary basis. That decision would not preclude the main argument being advanced at trial.

9    Dr Zaghloul also referred to statements in a letter of 15 March 2012 from Woodside’s Vice President of Human Resources. Dr Zaghloul contended that certain statements in that letter constituted admissions of bullying. However, his Honour took the same approach to that correspondence and expressed his reasons for doing so (at [13]-[16]) of the reasons for judgment.

10    His Honour was not satisfied that the common law claims could be established on a summary basis.

11    The primary judge also considered Woodside’s contentions that Dr Zaghloul’s claims for personal injury based on s 52 of the TPA were not maintainable by virtue of s 82(1AAA) of the TPA. He was satisfied that Dr Zaghloul’s claims in respect of a mental condition were claims for personal injury as defined in s 4KA of the TPA. Despite his Honour’s finding (at [50]) that Dr Zaghloul satisfied the statutory exception contained in s 60(4) of the Bankruptcy Act 1966 (Cth) which permits the pursuit of personal injury claims after bankruptcy, Dr Zaghloul’s claims for personal injury could not be maintained under s 82(1AAA).

12    Dr Zaghloul seeks leave to appeal from the latter decision as well as his Honour’s refusal to order summary judgement.

13    The Full Court in DÉcor Corp Pty Ltd v Dart Industries Inc (1991) 33 FCR 397 (at 398) made clear that generally there are two questions to be considered on an application for leave to appeal:

(a)    whether the decision at first instance was attended with sufficient doubt to warrant it being reconsidered; and

(b)    whether substantial injustice would result if leave were refused, supposing the decision at first instance was wrong.

14    An applicant seeking leave to appeal would usually be required to establish both matters.

15    I have read the extensive submissions and affidavit evidence filed by Dr Zaghloul in support of his application for leave to appeal. I have also read his draft notice of appeal and amended draft notice of appeal, and I have heard some oral submissions from him today on both applications.

16    The outline of submissions in support of his application for leave runs to 34 pages (with attachments of about the same length) and raises many matters which Dr Zaghloul might be expected to raise at trial. As matters presently stand, he will still have the opportunity to do so, but he does not point to any specific appellable error in the primary judge’s reasoning and neither am I able to discern any. The submissions do not support a conclusion as to error in declining his application for summary judgment. Even if summary judgment and this leave application are refused, Dr Zaghloul’s claim will still be on foot (subject only to the issue Woodside has raised in its application). But he will not be entitled to summary judgment, whether it be for $42 million or $26 million or any other sum.

17    His Honour gave detailed reasons as to why there were disputed questions of fact which needed to go to trial in relation to Dr Zaghloul’s summary judgment application. I am not persuaded his Honour’s reasoning on those matters was incorrect. In relation to the TPA claims, his Honour’s reasoning (at [51]-[60], particularly at [53]), in my view, his Honour was clearly correct as a matter of law.

18    Therefore, Dr Zaghloul’s application for leave to appeal will be refused with costs.

WOODSIDE’S APPLICATION FOR LEAVE TO APPEAL

19    I turn to Woodside’s application.

20    Woodside also seeks leave to appeal from his Honour’s decision. It files a draft notice of appeal, submissions and an affidavit in support.

21    Dr Zaghloul has filed submissions in response and made submissions today. Of course, as leave is granted to Woodside, he will not be precluded from arguing those matters on the appeal.

22    It is unnecessary to restate the principles from DÉcor v Dart.

23    Woodside had contended that the Court cannot award damages in tort or contract in respect of the mental or physical injury allegedly suffered by Dr Zaghloul and thus his claim should be dismissed. Woodside argued that those claims could not be maintained by virtue of the constraints on awards of common law damages imposed by the Workers’ Compensation and Injury Management Act 1981 (WA) (Compensation Act), an Act which this Court is required to apply in the present proceeding by virtue of s 79 of the Judiciary Act 1903 (Cth), which provides that the laws of each State or Territory are binding on all courts exercising federal jurisdiction in that State or Territory, unless the Constitution or Commonwealth law otherwise provides.

24    Dr Zaghloul contends that he suffered injury on 13 April 2011. It follows that his claim for common law damages for personal injury is governed by the Compensation Act as it was then in force.

25    Woodside relied on s 93K(4) as in force prior to 1 October 2011, which then stipulated that damages in respect of an injury can only be awarded if court proceedings seeking them are commenced within 30 days after the Director, Conciliation, WorkCover WA, gives the worker written notice that the Director has registered the worker’s election. Dr Zaghloul commenced the proceeding on 27 August 2012 but did not make a claim under the Compensation Act until 5 December 2012. Dr Zaghloul then made an election which was received on 20 February 2013. The Director notified Dr Zaghloul that she had registered his election on 25 February 2013.

26    Woodside argued before the primary judge there was no compliance with s 93K(4)(c), such that it was not open for Dr Zaghloul to receive an award in damages as the section provided that:

Damages in respect of an injury can only be awarded if -

. . .

(c)    court proceedings seeking the damages are commenced within -

(i)    the period of 30 days after the Director gives the worker written notice that the Director has registered the election; . . .

27    The submission advanced by Woodside was inconsistent with the decision of the Court of Appeal of the Supreme Court of Western Australia in St John of God Health Care Inc v Austin [2014] WASCA 11 in which the majority (Justice Pullin with whom Justice Murphy agreed) held that the word ‘within’ in the section meant ‘before the end of’ or ‘no later than’, so that provided a worker commenced proceedings no later than 30 days after the Director gave notice the section would have been complied with. The majority did not consider the section required the proceedings to be commenced during the 30 day period after the Director gave notice. The proceedings could be commenced before the Director gave the worker written notice.

28    The primary judge gave careful attention to the provisions of the Compensation Act and the majority and dissenting judgments in Austin. His Honour preferred the dissenting judgment in Austin, being the judgment of Justice Newnes, in which his Honour held (at [33]) that the words ‘within the period of 30 days’ ‘clearly’ mean that the proceedings must be commenced within the 30 day period immediately after the worker is given notice of the registration of his or her election.

29    However, the primary judge felt constrained to rule against Woodside in its argument and in accordance with the views of the majority in Austin, the views of which he understandably considered could not be described as being ‘plainly wrong’.

30    I have had regard to the submissions of Dr Zaghloul who, in particular, stresses the point identified by the primary judge that the majority in Austin relied upon a long line of authority emanating from the United Kingdom as followed and developed in Australia. I would add that the majority view appears to adopt a more beneficial construction from the perspective of a worker.

31    However, Woodside wishes to argue before the Full Court of this Court that the majority view in Austin is ‘plainly wrong’, which it needs to establish to succeed on its argument. In my respectful view, it is certainly possible that the Full Court may reach a view which differs from the majority in Austin and accords with the minority. I say this not simply as a matter of mere hypothetical possibilities. Rather, there is room for the argument that Justice Newnes was, with respect, correct in focussing on a construction of ‘within’ by reference to the statutory context as a whole, not only by examining how that word has been used in other decisions. It is arguably the case, as Woodside contends, and the primary judge apparently agreed, that rightly or wrongly, the dissenting judgment in Austin paid closer attention to the statutory text and context, including to the surrounding provisions, legislative history and secondary materials. In their written submissions on this application, Woodside outline at some length why that is so.

32    There is no need to rehearse all of Woodside’s submissions at this point. It is sufficient to say that, while the consequence may be severe, I consider there is sufficient likelihood that a Full Court will be persuaded that the minority view in Austin is correct so as to warrant leave. In this instance, as is not uncommonly the case on difficult questions, there is a division of opinion between experienced and eminent judges. That feature renders the topic an obvious candidate for further appellate consideration. Additionally, if Woodside’s argument prevails, the likely consequence would be that Dr Zaghloul’s claim for damages for personal injury could not be maintained. That would substantially dispose of the litigation without the need to proceed to what would be a trial involving substantial human and monetary ‘cost’ in the broadest sense of that word. It follows that the second limb in DÉcor v Dart is established.

33    I grant leave.

Associate:

Dated:    21 November 2014