Case Law Update
22 October 2015
The Application of ss 52(1) & 189(1) of the Workers Rehabilitation and Compensation Act (Northern Territory).
Alcan Grove Pty Ltd v Zabic [2015] HCA 33
Mr Zorko Zabic was employed by Alcan Gove Pty Ltd from 1974 until 1977. He worked as a labourer and claimed that during the course of employment he was exposed to materials containing asbestos dust and fibre. Mr Zabic claimed that he inhaled asbestos materials when he repaired and maintained pipes in the building. As a result of this exposure, Mr Zabic claimed that he contracted malignant mesothelioma which was diagnosed in January 2014.
Mr Zabic brought a claim against Alcan Gove Pty Ltd at common law for damages citing that his employer knew of the dangerous effects of asbestos and failed to warn him or take necessary precautions to protect himself.
The issue in this case was when the cause of action arose. Importantly, sections 52 and 189 of the Workers Rehabilitation and Compensation Act (NT) provide that damages should only be awarded where a worker demonstrates that a cause of action occurred before 1 January 1987.
Mr Zabic argued that the cause of action arose when he inhaled asbestos dust and fibre causing changes in his lungs before 1 January 1987. Alcan Grove relied on the Workers Rehabilitation and Compensation Act (NT) in arguing that the cause of action arose when Mr Zabic developed symptoms of mesothelioma after 1 January 1987 in 2013.
Northern Territory Court of Appeal Decision
Mr Zabic’s case was initially dismissed by the Northern Territory Supreme Court on the basis that as diagnosis occurred in 2014 there was no cause of action prior to 1 January 1987. Mr Zabic appealed to the Northern Territory Court of Appeal.
The Court of Appeal held that Mr Zabic would have experienced changes to his mesothelial cells in his lungs prior to 1 January 1987 at the time the asbestos fibres were consumed. The Court held that these changes had a causative effect on the development of malignant mesothelioma. Ultimately the Court of Appeal held that section 52 of the Workers Rehabilitation and Compensation Act (NT) did not prevent Mr Zabic from claiming damages and overturned the Supreme Court decision and awarded him $425,000 in damages against Alcan Gove.
High Court of Australia Decision
The High Court dismissed Alcan Gove’s appeal accepting Mr Zabic’s argument that the cause of action arose when the changes to his mesothelial cells occurred at the time the asbestos fibres were inhaled during his employment. The High Court accepted that those changes led to the development of Mesothelioma and held that as the cause of action arose prior to 1 January 1987 he was not prohibited from recovering damages.
Summary
As a result of the High Court Decision of Zabic, workers who were exposed to asbestos prior to 1 January 1987 and have been diagnosed with mesothelioma will now be able to claim damages against their former employer in the Northern Territory.
Essentially the High Court has held that a cause of action in negligence for damages occurs when the risk of developing an injury, like mesothelioma arises. It is not sufficient for there to simply be a risk, it must eventualize as it did for Mr Zabic when he experienced changes in the mesothelial cells.
The key reasoning by the High Court was that it was not the risk of mesothelioma but rather the physical injury constituted of the initial mesothelial cell changes that amounted to compensable damage sufficient for the workers cause of action to accrue before 1 January 1987 with the benefit of hindsight.
By Andrew Kemp, Principal
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