Livett v Hertess[2011] QDC 257

DISTRICT COURT OF QUEENSLAND

Introduction:

1. [1]
   The plaintiff Cheryll Ann Livett (“the applicant”) applies to the court for the primary order “that the time commencement of proceedings claiming damages for personal injuries by the plaintiff be extended to 11 March 2010 pursuant to s 31(2) of the Limitation of Actions Act 1974 (“LAA”)“.^[1]

2. [2]
   The applicant filed her claim on 11 March 2010 naming as first defendant Isolde Hertess (“the respondent”) and second defendant Ramsay Health Care Australia Pty Ltd. A notice of discontinuance has since been filed in respect of the second defendant so that the claim is now against the respondent only.^[2]

3. [3]
   The applicant’s claim against the respondent is that the applicant has suffered injury and other loss “as a consequence of the negligence and/or breach of contract” of the respondent who at all material times “was a specialist plastic surgeon carrying on practice in Cairns” and who performed “bilateral breast augmentation” on the applicant on the “13 August 2004” at the Cairns Private Hospital. In the normal course of events the applicant was therefore required to have commenced any proceeding against the respondent within three years of the 13 August 2004 that is not later than 13 August 2007.^[3]

4. [4]
   Pursuant to s 31(2) of the LAA the court may order the period of limitation for an action be extended if “it appears to the court –

1. (a)
   that a material fact of decisive character relating to the right of action was not within the means of knowledge of the applicant until a date after the commencement of the year last proceeding the expiration of the period of limitation for the action; and

2. (b)
   that there is evidence to establish the right of action apart from a defence founded on the expiration of a period of limitation”.

In which case “the court may order that the period of limitation for the action be extended … (for) 1 year after that date”.

5. [5]
   In this matter the applicant filed her Claim on 11 March 2010, therefore “a material fact of a decisive character relating to the right of action” needs to have become known to the applicant between 11 March 2009 and 11 March 2010. This conclusion arises from the observations of the High Court in Queensland v Stephenson (2006) HCA 20; 226 CLR 197 at [30] when it said:

“The practical result of this construction is that an applicant always has at least one year to commence proceedings from the time when his or her knowledge of material facts (as defined in s 30(1)(a)) coincides with the circumstance that a reasonable person with the applicant's knowledge would regard the facts as justifying and mandating that an action be brought in the applicant's own interests (as in s 30(1)(b)). If this conjunction of circumstances first occurs before the commencement of the last year of the limitation period, no application for an extension can be brought; the applicant has the benefit of at least one year before the limitation period expires and is required to act within that time. If the conjunction occurs after the commencement of that last year, the court is empowered, if the other criteria in s 31 are satisfied, to extend time for one year from the date of that conjunction of circumstances.“

6. [6]
   In this application therefore, the critical question facing the applicant is, was a material fact, namely in this instance “the fact of the occurrence of negligence or breach of duty…. on which the right of action is founded” not within the applicant’s means of knowledge until after the 11 March 2009 i.e. the applicant “did not know (that) fact” before the 11 March 2009 but she has “taken all reasonable steps to find out (that) fact” before the 11 March 2009 (see s 30(1)(c)(i) & (ii) of the Limitations of Actions Act 1974). (emphasis added).

The Law in general:

7. [7]
   The past 30 years have seen the development of a plethora of case law on the interpretation of sections 30 and 31 of the LAA including widespread criticism for its convoluted and obtuse drafting and my extrapolation from those authorities of the criteria which a court has to consider in determining whether to exercise its discretion to extend the limitation period in which to commence an action under section 31(2) are the following:

1. (a)
   There must be a material fact;

2. (b)
   The fact must be of a decisive character;

3. (c)
   The fact must not have been within the means of knowledge of a plaintiff until after “the critical date”;^[4]

4. (d)
   A plaintiff must have taken all “reasonable steps” to establish the fact before “the critical date”;

5. (e)
   There is evidence to establish a plaintiff’s right of action (excluding the expiry of limitation point); and

5. (f)
   A defendant is not prejudiced at trial by the extension of the limitation period.

8. [8]
   Section 30(1)(a) sets out what a “material fact” may “include”; section 30(1)(b) sets out when a “material fact” is “of a decisive character” and section 30(1)(c) defines when “a fact is not within the means of knowledge of a person at a particular time….”. (emphasis added).

9. [9]
   In Queensland v Stephenson referred to in [5] above, the majority of the court attempted to crystallise the proper “construction” of section 31(2) in the terms set out at paragraphs [29] and [30] thereof with paragraph [29] stating:

“[29] The better view is that the means of knowledge (in the sense given by

para (c) of s 30(1)) of a material fact is insufficient of itself to propel the applicant

outside s 31(2)(a). For circumstances to run against the making of a successful

extension application, the material fact must have “a decisive character”.

Whether the decisive character is achieved by the applicant becoming aware of

some new material fact, or whether the circumstances develop such that facts

already known acquire a decisive character, is immaterial. It is true to say, as the

plaintiffs submit in their written submissions, that in a sense none of the material

facts relating to the applicant’s right of action is of a decisive character until a

reasonable person “knowing those facts and having taken the appropriate advice

on those facts, would regard those facts as showing” the features described in

subparas (i) and (ii) of s 30(1)(b). Whether that test has been satisfied at a particular point in time is a question for the court.”

The “practical result” statement then followed at paragraph [30].

10. [10]
    Section 30(1)(a)(i) of the LAA provides that “the fact of the occurrence of negligence… or breach of duty on which the right of action is founded” is a material fact relating to the right of action. The fact will be of a “decisive character” if, without it, no cause of action would exist against the defendant.

11. [11]
    The discovery by a patient that a medical practitioner had provided advice, performed a surgical procedure or provided medical treatment at a standard below that to be expected of a competent and skills surgeon would ordinarily be a material fact of a decisive character. As Thomas J.A. wrote in Dick v University of Queensland [1979] Qd R 469:

“The distinction between knowledge that someone has caused an injury and knowledge that that person has caused it negligently is fundamental.”^[5]

12. [12]
    The discovery of expert evidence to prove a case on liability has consistently been held to be a material fact of a decisive character, particularly in cases involving medical negligence: Campbell & Anor. v. Bleakley [2007] QSC 351; Ervin v. Brisbane North Regional Health Authority (Appeal No. 267 of 1993) Court of Appeal, Queensland; Castlemaine Perkins v. McPhee [1979] Qd R 469.^[6]

Has the applicant taken “all reasonable steps” to find out the fact?:

13. [13]
    The test to ascertain whether the applicant has taken “all reasonable steps” to find out the fact is both objective and subjective. In Castlemaine Perkins v. McPhee, ^[7] the Full Court stated that the test of the reasonableness of the steps taken by the applicant is objective with regard being had to the background and situation of the applicant.^[8]

14. [14]
    In Do Carmo v. Ford Excavations Pty Limited (No. 5)^[9] Dawson J. stated:

“The remarks of Lord Reid in Smith v. Central Asbestos Co made in reference to a similarly worded provision, are to the point:

In order to avoid constructive knowledge, the plaintiff must have taken all such action as it was reasonable then to take to find out. I agree with the view expressed in the Court of Appeal that this test is subjective. We are not concerned with the “reasonable man”. Less is expected of a stupid or uneducated man than of a man of intelligence and wide experience. It is also to be noted that it does not matter what advice the appellant received … what is important is the means of knowledge that was reasonably available to the appellant. And that must mean available in a practical and not theoretical sense.”^[10]

15. [15]
    In Royal North Shore Hospital v. Henderson,^[11] Mahoney J. stated:

“The phrase “reasonable steps” may have at least two significations. A particular step not taken may not fall within “reasonable steps” because, in the circumstances, it was not reasonable to expect the plaintiff to take any steps at all; or it may not fall within the phrase because, though he could reasonably be expected to take some steps, the step in question could not reasonably be expected of him. The latter is, perhaps, the meaning ordinarily to be given to the phrase but it may, I think, also include the former. In the present context, I do not think it was intended that a fact should be taken to be within the means and knowledge of a plaintiff and it would not have been reasonable to expect him to take any steps at all.

…

In this regard, it is, I think, to be noted that in determining what is “reasonable” for this purpose, the Act does not require that it be assumed that the plaintiff would have taken advice. There is a distinction in this regard between s 57(1)(e) and s 57(1)(c). Whether it would have been reasonable to take advice and what steps thereafter would have reasonably been taken must be determined with reference to the particular plaintiff or, possibly, by reference to him as a reasonable person.”^[12]

16. [16]
    Most recently, in NF v. State of Queensland^[13] Keane J.A., with whom the other members of the Court agreed, said at [29]:

“It is to be emphasised that s 30(1)(c) does not contemplate a state of knowledge of material facts attainable in the abstract, either by the exercise of “all reasonable steps”, or by the efforts of a reasonable person. It speaks of a state of knowledge attainable by an actual person who has taken all reasonable steps. The actual person postulated by s 30(1)(c) as the person who has taken all reasonable steps, is the particular person who has suffered particular personal injury. Whether an applicant for an extension of time has taken all reasonable steps to find out a fact can only be answered by reference to what can reasonably be expected from the actual person in the circumstances of the applicant. It seems to me that, if that person has taken all the reasonable steps that she is able to take to find out the fact, and has not found it out, that fact is not within her means of knowledge for the purpose of s 30(1)(c) of the Act. This view is supported by the text of s 30(1)(c)(ii) which is, as I have said, in marked contrast to s 30(1)(b).

…

Section 30(1)(c) is not concerned with what might be expected of a reasonable person: it is concern with what might reasonably be expected of the applicant in the particular case.”^[14]

Law on “Prejudice”:

17. [17]
    An applicant who satisfies the elements of section 31(2) of the Act is not entitled as of right to an order. The applicant must still justify the exercise of the court’s discretion in his or her favour. The principal discretionary ground which might prevent an order being made to allow an applicant to commence proceedings outside the limitation period is prejudice that will be suffered by a respondent (defendant) if such an order is made. The onus remains on the applicant to establish that the discretion should be exercised in his/her favour. As Keane JA held in HWC v The Corporation of the Synod of the Diocese of Brisbane [2009] QCA 168 at [57]:

“Even where the requirements of s 31(2) have been satisfied, the burden remains on the applicant for relief to show good reason for the favourable exercise of the discretion. An applicant who is unable to show that a fair trial can take place notwithstanding the delay which has occurred will not discharge that burden.”

18. [18]
    The leading case on the effect of prejudice on the court’s discretion is Brisbane South Regional Health Authority v Taylor [1996] HCA 25. Toohey and Gummow JJ explained it at 548-549 as follows:

“A material consideration (the most important consideration in many cases) is whether, by reason of the time that has elapsed, a fair trial is possible. Whether prejudice to the prospective defendant is likely to thwart a fair trial is to be answered by reference to the situation at the time of the application. It is no sufficient answer to a claim of prejudice to say that, in any event, the defendant might have suffered some prejudice if the applicant had not begun proceedings until just before the limitation period had expired. ”(footnotes omitted)”.

McHugh J held at 555:

“If the action had been brought within time, it would have been

irrelevant that, by reason of the delay in commencing the action, [the

medical practitioner] might have had little independent recollection

of his conversation with the applicant and that the defendant might

have had difficulty in fairly defending itself. But once the potential

liability of the defendant had ended, its capacity to obtain a fair trial,

if an extension of time were granted, was relevant and important. To

subject a defendant once again to a potential liability that has expired

may often be a lesser evil than to deprive the plaintiff of the right to

reinstate the lost action. This will often be the case where the

plaintiff is without fault and no actual prejudice to the defendant is

readily apparent. But the justice of a plaintiff's claim is seldom

likely to be strong enough to warrant a court reinstating a right of

action against a defendant who, by reason of delay in commencing

the action, is unable to fairly defend itself or is otherwise prejudiced

in fact and who is not guilty of fraud, deception or concealment in respect of the existence of the action.”

19. [19]
    This topic was again more recently discussed by our Court of Appeal in Hertess v Adams [2011] QCA 73 at paragraphs [4] to [8] and [14] to [16] thereof highlighting “the High Court’s exposition of principle in Brisbane South Regional Health Authority v Taylor” and in particular at paragraph [7] of Muir J.A’s judgment quoting McHugh J explaining “the significance of the expiration of the limitation period and the likely consequence of a finding of actual significant prejudice“. Ultimately it comes down to the fundamental question – has the applicant also discharged his/her onus, that notwithstanding that the applicant has satisfied the requirements of s 31(2) of the LAA, is a defendant likely to be able to defend him/herself fairly at trial? It is then a matter of analysing the evidence to determine whether a “fair trial” can be achieved.

Applicant’s Chronology:

20. [20]
    The applicant has provided the following “Brief chronology” to the court of relevant dates and events namely:

Applicant’s Evidence:

21. [21]
    The applicant’s evidence includes the following:

1. (a)
   Her affidavit with exhibits filed 10 June 2010.

2. (b)
   Three affidavits with exhibits of Olamide Kowalik solicitor filed 10 June 2010; 5 August 2010 and 16 September 2010 respectively. The applicant was cross-examined at the hearing of the application.

22. [22]
    In her evidence the applicant says among other things:

23. [23]
    The applicant had further “post operation complications” including “increasing redness in my right breast”; was not able to see the respondent at this time but attended upon her general practitioner explaining that she “had developed a fever, nausea, diarrhoea and dizziness and was referred “directly to the Cairns Base Hospital with a referral letter”.^[22]

24. [24]
    The applicant was treated at the Cairns Base Hospital by a Dr Roxanne Wu who contacted the respondent and the applicant “could overhear” a heated conversation taking place between Dr Wu and the respondent.

25. [25]
    The applicant underwent a “third surgery” on 24 April 2005 being “irrigation and re-suturing to my right breast”.^[23]

26. [26]
    At that time the respondent “commented” to the applicant “that her insurance company told her not to speak with me and that she should not be there”. The respondent paid the applicant’s hospital fees for this further operation.

27. [27]
    The applicant continued to have “post-operation complications” after this “third surgery” and returned to the respondent on a number of occasions for follow-up treatment.

28. [28]
    The applicant had a “fourth surgery” by a Dr Anthony Green to whom the respondent had referred the applicant and the applicant “underwent removal of my right breast implant and also the lower half of my right breast tissue by Dr Green”.^[24] The applicant was also advised that she “would need to undergo hypobaric therapy due to a decrease in my red blood cells”.

29. [29]
    The applicant then commenced a course of “hypobaric treatment under the direction of Dr Green” in June/July 2005 and May/June 2008.

30. [30]
    The applicant has continued to have “prolonged visits to the hypobaric chamber” and continues to have ongoing problems with her right breast. She was prompted to seek legal advice after reading the “Cairns Post article on 1 April 2009” and subsequently her solicitors received a medical report dated 20 April 2010 from Professor Marshall.

31. [31]
    The applicant was cross-examined at length at the hearing which included the following:-

Applicant’s Submissions:-

32. [32]
    Excluding submissions as to the principles of law to be applied the applicant’s submissions on the facts of this application include the following:-

33. [33]
    The applicant replies to the respondent’s submission “that the applicant should have taken further steps to investigate the claim after the surgery of 24 April 2005 and the discussions of 11 May 2005” by submitting that “the respondent had not admitted any negligence and the applicant was not interested in pursuing a claim. She had recently undergone major surgery and was recovering. She wanted to heal. She accepted the respondent’s offer to pay her hospital stay as a gesture of good faith. It was not in the applicant’s interest to pursue to proceedings at that time” and the applicant’s “failure to take any steps to investigate a claim prior to 1 April 2009 was reasonable”.^[48]

34. [34]
    The applicant further submits that “there is evidence to support a case of breach of duty by the defendant” and refers to Professor Marshall’s report identifying “four separate aspects of the treatment that were below the standard to be expected of a competent and skilled surgeon”.^[49]

35. [35]
    “As to causation” the applicant essentially relies on the authority of Elborne v Gibbs and in particular paragraph 78 thereof in the judgment of Basten JA.^[50]

36. [36]
    On the “prejudice” point the applicant submits that the application were granted there is no prejudice to the respondent; she was able to give “evidence of her usual practice”; her notes in respect of the consultations are available; and ultimately the applicant submits that she “has discharged the onus to demonstrate that the respondent will still be able to receive a fair trial if the limitation period were extended”.^[51]

Respondent’s Submissions:-

37. [37]
    The respondent opposes the application to extend the limitation period “on two bases”:

1. (a)
   the applicant does not show that there is any material fact of a decisive character that came into the applicant’s possession late (the material fact point);

2. (b)
   the respondent is prejudiced by the delay so that there cannot be a fair trial of this matter (the prejudice point).

and expands upon that basic submission in some detail.

38. [38]
    The respondent accepts that “the only matter capable of amounting to a new material fact shown on the applicant’s material is the receipt of Dr Marshall’s opinion.”^[52]

39. [39]
    The respondent further submits that the applicant “knew all the physical matters alleged and knew what warnings had (or had not) been given well before the expiry of the limitation time. Further she knew the effect that the surgery and its sequelae had had upon her person and psychological state”.^[53]

40. [40]
    The respondent’s further submissions include the following:

41. [41]
    The respondent further submits that even if the court is satisfied of those matters set out in s 31(2)(a) and (b) of the LLA the court should exercise its discretion and not extend the limitation period “because prejudice occasioned to Dr Hertess prevents the matter from being tried fairly.”^[56]

42. [42]
    The respondent further submits that she has suffered “actual prejudice because she has limited recollection without her notes and relying on the principles set out in Taylor’s case the application should be dismissed.”

43. [43]
    Ultimately the respondent submits that “the application to extend the limitation period ought not be granted because:

1. (a)
   Material facts relevant to this cause of action have been known to the applicant since the middle of 2005; and

2. (b)
   of the prejudice caused by the delay of the applicant in bringing her claim … (and) the application be dismissed”.^[57]

Findings and Conclusion:-

44. [44]
    On a consideration of the evidence before the court and the submissions made I make the following findings in this application:

1. (a)
   I am not satisfied that the applicant has established the two limbs of s 31(2) of the LAA namely that “a material factor of decisive character relating to the right of action was not within (her) means of knowledge” until after the “critical date” that is “11 March 2009” for the following reasons:

1. (i)
   The applicant relies upon Professor Marshall’s report of “20 April 2010” received by her solicitors on “13 May 2010” which it is submitted provides the “material fact” evidence which did not come to her attention before that time and in respect of which she had “taken all reasonable steps to find out the fact before that time” but it seems to me and I so find that the evidence provided by Professor Marshall does not contain or reveal any “material fact of a decisive character” of which the applicant was not aware before the “11 March 2009” and indeed from the evidence before the court the applicant was aware of all of those facts “relating to a right of action” at or about mid 2005;

2. (ii)
   The evidence is that the applicant:

1. (a)
   Was given information by or on behalf of the respondent about the proposed operation including “pamphlets” and the “website” reference in October 2003 and although I accept her evidence that she was not warned that she “would have an increased risk of infection” because of her history with resultant “numerous complications”, these sequalae in fact arose post surgery on 13 August 2004, and continuing into 2005 requiring three further operations and numerous attendances on medical practitioners apart from the respondent;

2. (b)
   Was aware of or had the means of knowledge of all of the facts material to her right of action not later than mid 2005 in that:

1. (i)
   Dr Wu told her in April 2005 that the applicant was suffering from severe infection following the respondent’s operating upon her in August 2004, which should not have been allowed to deteriorate to such a state and for which in Dr Wu’s opinion the respondent was responsible, confirmed by the “heated” exchange per telephone overheard by the applicant between Dr Wu and the respondent at that time;

2. (ii)
   The applicant had been told by Dr Green in mid 2005 that because she had radiotherapy in 1994 her tissues were “less tolerant to infection” after any surgery of which she ought to have been warned (but was not) by the respondent before surgery to enable the applicant to make an informed decision on the prospective surgery. Further to this the applicant acknowledged that the absence of this warning by the respondent upset her when she was informed by Dr Green in mid 2005 that it should have been given;

3. (iii)
   The applicant was further aware of her post operative complication at the hands of the respondent in April 2005 when the respondent apologised to her for the applicant’s then condition for which the respondent acknowledged responsibility and paid the applicant’s hospital fees for the second operation. There was also mention and discussion at that time of the respondent being concerned about the applicant bringing a “claim” against the respondent with the respondent’s note of 11 May 2005 recording that the applicant “would not take legal action”.^[58] As I read Professor Marshall’s report there is nothing contained therein of which the applicant was not aware before the “critical date” or in respect of which she had “taken reasonable steps” to ascertain.

3. (c)
   While I accept that the period in mid 2005 would have been a most upsetting time for the applicant she had recovered sufficiently to return to her duties as a police officer by mid 2006 after undergoing hyperbaric treatment for the first time in 2005 but even at this point in time well within the limitation period she did not take any “reasonable steps” to seek “appropriate advice” as to her legal rights.

45. [45]
    I find therefore for the above reasons the applicant has not established that there is any “material fact of a decisive character” which came into her possession after the “11 March 2009” entitling her to an order under s 31(2) of the LAA.

Prejudice Point:

46. [46]
    In the light of my findings above it is unnecessary for me to make a formal finding on the “prejudice point” in this application although I note that the Court of Appeal made an adverse finding against the plaintiff (Respondent to the Appeal) in the matter of Hertess v Adams [2011] QCA 73 on the issue of prejudice occasioned to Dr Hertess in that claim. In that matter the court found that “the primary judge looked impermissibly to the comparison of the prejudice which was likely at the time of the application to that which would have existed in any event had the application been made within the limitation period”^[59] whereas “Brisbane South makes it plain that the existence and extent of any prejudice suffered by the applicant (Dr Hertess) must be assessed as at the date of the application”.^[60] Further to this there was the “onus of proof” issue in respect of the exercise of a court’s discretion to grant an extension of time which must rest with the applicant to discharge not a respondent. Muir JA set out at paragraphs [14] and following of his judgment a summary of the principles on point established in the Brisbane South case, particularly at paragraph [16] quoting McHugh J who “explained the rationale underlying limitations statutes and the bearing of that rationale and the existence of an expired limitation period on the exercise of a discretion under 31(2)“.^[61] Muir JA identified the absence of co-operation by the nurse Ms Diversi as constituting “actual prejudice” to Dr Hertess, and the applicant for an extension of time in that case (Adams) had not discharged her onus to invoke the court’s discretion in her favour. Notwithstanding that decision, the circumstances of the instant application are different and although Ms Diversi may prefer “not to be involved” (which is hardly a vehement statement of reluctance to become involved) in any potential claim as she has expressed in other matters I would have exercised my discretion in this applicant’s favour to extend the limitation period in that in my view the respondent would not be prejudiced in being able to have a “fair trial” of the issues to be debated, if the applicant had satisfied s 31(2) of the LAA for the following reasons:

1. (a)
   Although approximately 6 years have elapsed since the applicant’s initial surgery and the issue of proceedings, the respondent has a far greater awareness of this applicant’s condition and treatment than might be the case with many other of her patients, in that she was involved with the applicant over an extended period of time; operated upon her on 2 occasions; has all of her surgery and other notes of consultations and advice and is able to give evidence of her general practice in the performance of her specialist procedures;

2. (b)
   there is no evidence before the court that witnesses are not available (albeit expressing a preference not to be involved) to be called; and

3. (c)
   the time frame in this matter is substantially less than in the Brisbane South case where it was found for that reason there was “actual prejudice” to the defendant requiring the court’s discretion to be exercised against that applicant.

For these reasons I find that there could be a “fair trial” of the issues but the applicant has not discharged her onus under s 31(2) of the LAA.

Costs:

47. [47]
    In relation to the question of costs, the general rule under r.681 UCPR is that the costs of a proceeding, including an application are to follow the event unless the court orders otherwise. Should the parties fail to reach an agreement on the question of costs of this application, I will allow 28 days from the date of this judgment to provide to the court written submissions as to the appropriate costs order to be made herein.

Orders:

48. [48]
    My orders in this matter are:

1. (a)
   The application is dismissed;

2. (b)
   The parties have leave to make written submissions to the court within 28 days on the question of costs failing agreement between them.