On 9 December 2011, the High Court granted special leave to Newcrest Mining Ltd to appeal the controversial decision of the Western Australian Court of Appeal in Thornton v Newcrest Mining Ltd [2011] WASCA 92.
Michael Thornton alleged he was injured while working at a mine occupied by Newcrest Mining. At first instance, Mr Thornton did not seek damages from Newcrest Mining, instead claiming workers compensation payments from his employer. He later commenced an action against his employer in the District Court of Western Australia. The action was settled by way of a consent judgment against the employer. The employer paid the settlement sum in full and the judgment was discharged. A year later, Mr Thornton commenced a separate and new action against Newcrest Mining and three other defendants in the District Court. In this second action, he claimed damages against the defendants as a result of the same work accident and the same injuries.
Newcrest Mining applied for summary judgment in light of the settlement of the first action. The District Court granted the application on the basis Mr Thornton had already been awarded damages in respect of the same injuries and therefore could not be awarded damages again. When reaching this decision, the District Court also found that at no time prior to the settlement of his claim against his employer did Mr Thornton expressly reserve his rights to pursue a claim against any other tortfeasor.
Mr Thornton appealed this decision to the Court of Appeal. The appeal focused on the interpretation of the Law Reform (Contributory Negligence and Tortfeasors' Contribution) Act 1947 (WA) (Law Reform Act), which is designed to preclude plaintiffs from being awarded damages for the same injury in successive actions. The question before the Court of Appeal was whether Mr Thornton had been "awarded" damages in his first action against his employer when the consent to judgment was entered.
The Court of Appeal held that a payment further to a consent judgment was not an award of damages. As such, the court found there was nothing to stop Mr Thornton from bringing his further claim against Newcrest Mining. In doing so, the Western Australian Court of Appeal reached the same conclusion as the New South Wales Court of Appeal in Nau v Kemp & Associates [2010] NSWCA 164, which addressed the interpretation of a similar provision in the Law Reform (Miscellaneous Provisions) Act 1946 (NSW).
Newcrest Mining's appeal to the High Court will be heard in 2012. In the appeal, the High Court will be asked to consider whether the restrictions on recovering damages in multiple actions under the Law Reform Act (and its equivalent legislation in New South Wales, Queensland and the Northern Territory) only apply to damages awarded by a court following a judicial assessment, or if the provisions have broader application and apply to a judgment entered by a court by the consent of the parties. Needless to say, if the decisions of the Western Australian and New South Wales Courts of Appeal are not overturned, parties to litigation will need to give careful consideration to the mode in which actions are resolved prior to trial. This will be particularly relevant to insurers, who may be forced to pay out multiple settlements in successive actions commenced against named insureds and third-party beneficiaries if the first settlement does not extinguish the plaintiff's right to seek further damages.
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