Alcoa Portland Aluminium Pty Ltd v Victorian WorkCover Authority [2007] VSCA 210

Court of Appeal (Vic)|2007-10-11|Before: MAXWELL ACJ, CHERNOV and NEAVE JJA

INDEMNITY APPLICATION - Section 138(1)(3) of the Accident Compensation Act 1985 - Application of Wrongs Act 1958 to hypothetical assessment of damages under s 138 - Indemnity for medical reports obtained by Victorian WorkCover Authority - Whether s 28IA(2) of the Wrongs Act to be read disjunctively - Grice v State of Queensland [2005] QCA 272 - Geaghan v D'Aubert [2002] NSWCA 260 - Griffiths v Kerkemeyer damages.

**1 I have had the considerable advantage of reading in draft the reasons for judgment of Chernov JA. I too would dismiss the appeal and the cross-appeal and, subject to what follows, I would do so for the reasons which his Honour gives.

2 In the cross-appeal, the Victorian WorkCover Authority ('VWA') contended that the reasonable costs of medical reports obtained by it, for the purposes of assessing a worker's compensation claim, constituted an 'amount of compensation paid or payable under this Act in respect of the injury', within the meaning of s 138(3)(a) of the Act. I respectfully agree with Chernov JA that those costs cannot be characterised as 'compensation paid or payable' under the Act. Rather, those costs were incurred by VWA in the course, and for the purpose, of administering the Act.

3 VWA relies on the statutory obligation imposed on it by s 99(1)(a) -**

to pay as compensation the reasonable costs of the medical services received because of the injury. (emphasis added)

Because the definition of 'medical services' includes 'the provision by a medical practitioner of any report authorised by [VWA]', so the argument goes, the costs incurred by VWA in obtaining such a report are to be regarded as having been paid 'as compensation' pursuant to s 99(1)(a).

1"> 4 This argument is, in my view, wholly without merit. On no reasonable view could the payment made by VWA for the medical reports which it obtained have been regarded as a payment made in discharge of the liability imposed by s 99(1)(a). The payment made for a medical report obtained by VWA is made in discharge of the contractual liability which VWA incurs when it engages the medical practitioner to provide the requested service. What s 99(1)(a) is concerned to do is to impose on VWA a liability which, but for the statute, it would not have. The section proceeds on the assumption that the injured person (or his/her dependants) may have incurred costs, in one or more of the various categories, by reason of the injury. VWA is obliged by s 99(1)(a) to pay, or reimburse, those costs.

**5 The appeal and cross-appeal in this matter were heard together with the appeal in proceeding No. 1316 of 2005[1] ('the common law proceeding') in respect of which we delivered our reasons for judgment immediately before publishing these reasons. As has been explained in the reasons relating to the common law proceeding, both appeals arise out of the injury sustained by Gregory Husson ('Husson') on 26 April 2001 in the course of his work at the plant of the appellant, Alcoa Portland Aluminium Pty Ltd ('Alcoa') whilst he was in the employ of Keppel Prince Engineering Pty Ltd ('Keppel'). On 3 January 2006 the trial judge gave judgment for Husson in the common law proceeding and made consequential orders as to costs. As between Alcoa and Keppel, his Honour apportioned liability 20 per cent against Keppel and 80 per cent against Alcoa. He also found that there was no contributory negligence by Husson.

6 In the present proceeding the respondent, the Victorian WorkCover Authority ('VWA'), sought partial indemnity from Alcoa in respect of compensation paid and payable by it to Husson. The indemnity was sought pursuant to s 138(1) and (3) of the Accident Compensation Act 1986 ('the Act'), the relevant terms of which are these:**

(1) Where an injury or a death for which compensation has been paid, or is or may be payable, by the Authority, a self-insurer or an employer was caused under circumstances creating a legal liability in a third party to pay damages or that would, but for section 134A, create such a liability in respect of the injury or death, the Authority, self-insurer or employer is entitled to be indemnified by the third party in accordance with this section.

(3) The amount which a third party is required to pay as indemnity under sub-section (1) is the lesser of -

(a) the amount of compensation paid or payable under this Act in respect of the injury or death; and

(b) the amount calculated in accordance with the formula -

X is the extent, expressed as a percentage, whereby the third party's act, default or negligence caused or contributed to the injury or death;

A is the amount of damages (disregarding the extent, if any, whereby any other person's act, default or negligence caused or contributed to the injury or death) for pecuniary loss and non pecuniary loss which the third party is or would have been liable to pay in respect of the injury or death were it not for the provisions of this Act and the Transport Accident Act 1986;

B is the amount recovered or recoverable by the Authority, the self-insurer or the employer under section 137 from the Transport Accident Commission (otherwise than under a settlement);

C is the amount paid by the third party in respect of the injury or death to the worker or the dependants of the worker under any settlement of, or judgment in, an action by the worker or dependants of the worker against the third party.

7 It was common ground between the parties that compensation was paid by VWA to Husson in respect of his injuries. Given the decision in the common law proceeding, the parties in the present proceeding had to accept that Husson's injuries were 'caused under circumstances creating a legal liability [in Alcoa] to pay damages' within the meaning of s 138(1) of the Act and that Alcoa caused or contributed to the injuries to the extent of 80 per cent. Similarly, both parties accepted that the conceptual basis of the factor A referred to in s 138(3)(b) was to be ascertained by reference to a hypothetical assessment of damages as explained by Winneke P in Esso Australia Ltd v Victoria WorkCover Authority.[2] The learned trial judge in this case noted that there was also no dispute as to the following components of factor A:

8 As counsel for Alcoa explained to us in the appeal in the common law proceeding, it was common ground between the parties that of the six issues raised by the two appeals, the following three issues arise for determination in the present appeal, namely -

(a) VWA's challenge by way of cross-appeal to his Honour's conclusion that the cost of medical reports did not constitute 'compensation' that is recoverable pursuant to s 138 of the Act.

(b) VWA's challenge by way of cross-appeal to his Honour's conclusion that Part VB of the Wrongs Act 1958 has application in calculating factor A of the formula contained in s 138(3)(b) of the Act.

(c) Alcoa's contention that, in any event, his Honour erred in his conclusion that, on a proper construction of s 28IA of the Wrongs Act and in the circumstances of this case, the section excluded from factor A calculations of hypothetical damages recognised in Griffiths v Kerkemeyer.[3]

**9 As has been noted, the common law proceeding and this proceeding were heard together by the same judge, and in this proceeding neither Alcoa nor VWA called oral evidence that was additional to that called at the common law proceeding. It was accepted by the parties that evidence in the common law proceeding, to the extent relevant, would be evidence in the present proceeding (although VWA tendered certificates in the course of the hearing of the VWA matter that are not necessary to detail for present purposes).

10 It is convenient to deal with the issues in the order in which they were outlined by us by counsel for Alcoa.**

**11 The first issue was whether the costs of the medical reports incurred by VWA in relation to Husson are recoverable by it under s 138 of the Act. There was no dispute between the parties that the medical reports were in fact obtained by VWA and they also agreed that the costs incurred in that regard were reasonable. VWA contended before us, correctly, I think, that the relevant question was whether each payment made constitutes, for the purposes of s 138(3)(a), an 'amount of compensation paid ... under this Act in respect of the injury'.

12 In its cross-appeal, VWA contended that these costs fell within s 138(3)(a) and thus, it said, it was entitled to be indemnified in respect of them pursuant to sub-s (1). His Honour rejected this claim. He considered that the phrase 'the amount of compensation paid or payable' in s 138(3)(a) was to be given the same meaning as the relevant words in s 138(1), namely, compensation paid or payable for an injury or death 'under circumstances creating a legal liability in a third party to pay damages'. As the opening words of s 138(3) make clear, said his Honour, the 'amount of compensation paid or payable' in s 138(3)(a) is to be calculated in one of two alternative ways that define 'the amount which a third party is required to pay as indemnity under sub-s (1)'. His Honour concluded that the amounts claimed by VWA as reflecting the cost of the medical reports do not fall within that class of payments to which it is entitled to indemnity under s 138(1). His Honour went on to say that s 99(1) and the definition of 'medical services' in s 5 of the Act do not expand the category of what is in fact paid by way of compensation.

13 I consider his Honour did not err in his conclusion that the VWA was not entitled to receive, as compensation under s 138(3)(a), the costs of the medical reports. 'Compensation' is not defined in the Act and, in the circumstances, should be given its ordinary and natural meaning. A reference to dictionaries for the purpose of ascertaining the meaning of the word in question is permissible.[4] Thus, Osborn's Concise Law Dictionary[5] defines 'compensation' as '[a] payment to make amends for loss or injury to person or property or as recompense for some deprivation, e.g. compensation to the owner for compulsory acquisition of his property'. And although care must be taken in relying on definitions of the word in other cases the meaning attributed to 'compensation' in such cases can be of some assistance. Thus, for example, Lord Dunedin said in Great Western Railway Company v Helps:[6]**

...compensation which is directed to be paid by the employer to a workman who is injured by accident arising out of and in the course of his employment ... has its natural meaning- that is to say, something that is to be paid which makes up for the loss that the man has sustained.

And in Halsbury's Laws[7] it is said:

In the sense in which the term is usually used 'compensation' may be defined as the pecuniary recompense which a person is entitled to receive in respect of damage or loss which he has suffered, other than as a result of an actionable wrong, litigated in the civil court, committed by the person bound to make recompense.

14 The money that was paid by VWA for the medical reports, as counsel for Alcoa submitted, was paid in the performance of its statutory obligations including the receipt and assessment of Husson's claim for compensation. It seems to me that it is apparent that VWA's expenditure on medical reports did not constitute payment by it of compensation as described earlier. In no sense, I think, can it be said that such payment was compensation paid under the Act. On the contrary, it is VWA that is now seeking compensation or reimbursement for part of its costs of administering the Act. The expanded definition of 'medical services' in s 5 of the Act does not convert VWA's payments that were made for its purposes to payments of compensation within the meaning of s 138(3)(a). Consequently, I consider that VWA's cross-appeal on that issue should be dismissed.

Application of Wrongs Act in calculating factor A

**15 The second issue that was raised in the appeal was, as has been noted, whether his Honour erred in concluding that Part VB of the Wrongs Act applies in the calculation of factor A of the formula contained in s 138(3)(b) of the Act. This issue was argued below in the context of whether, having regard to the relevant provisions of the Wrongs Act, Griffiths v Kerkemeyer damages were to be taken into account for the purpose of calculating the hypothetical damages contemplated by factor A. As I have mentioned, it was common ground between the parties that, for the purpose of calculating factor A, 'damages' (to which the injured person was entitled at common law) were to be calculated on a hypothetical basis. But VWA contended, below and in its cross-appeal, that the provisions of the Wrongs Act had no application to such a calculation because the claim for indemnity was not a claim for an award of personal injury damages and, or alternatively, because the terms of s 28C(2)(c) of the Wrongs Act exclude from the operation of Part VB an award to which Part 4 of the Act applied.

16 His Honour noted that, in light of Sweedman v Transport Accident Commission,[8] a claim for indemnity pursuant to s 138 is not a claim for an award of personal injury damages. Nevertheless, his Honour said, the essence of the calculation of factor A in cases such as the present is that it requires the hypothetical assessment of the award of damages (on the basis that the Act did not apply - i.e., 'were it not for the provisions of this Act'). His Honour considered that the Wrongs Act would apply to such an assessment of damages in respect of Husson's injury. Moreover, he said, s 28C(2)(c) was no answer to this because the hypothetical award of damages would not be one 'to which Part 4 of the [Act] applies' given that the assessment is to be undertaken on the basis that the provisions of the Act would not apply.

17 In contending that his Honour erred in this conclusion, VWA first argued that the Wrongs Act does not apply to a hypothetical assessment of damages because there is nothing in its provisions that provides for such a result. It was said that the Wrongs Act, or the Act, could have made provisions for this but did not do so. It was also said that authorities, including Esso Australia Ltd v Victorian Workcover Authority,[9] have made it plain that s 138 of the Act was concerned only with the common law or general law damages so that the Wrongs Act has no operation in that context. Counsel for VWA argued that, in terms of the language and intent of the Wrongs Act, it does not operate in respect of claims covered by the Act. It was further argued that the Wrongs Act applies only to actual, as distinct from hypothetical, awards of damages. In that respect, counsel pointed to what was said in Hynes v Hynes[10] concerning the operation of Part VB of the Wrongs Act in the context of s 94 of the Transport Accident Act 1986. More particularly, his Honour said that Part VB is concerned with 'awards of personal injury damages, not claims for damages of such a kind'. Later, his Honour said that, in any event, the word 'award' in s 28C(2) 'in the context of Part 6 of the Transport Accident Act is to be understood as referring to an award of common law damages.' But that observation was made in relation to the operation of the Transport Accident Act, the indemnity provisions of which are materially different from s 138 of the Act.

18 In my view, these arguments do not demonstrate error by his Honour in concluding that Part VB of the Wrongs Act applies to a hypothetical assessment for damages for the purposes of factor A. First, I think that, on a plain reading of the words referrable to factor A, it seems apparent enough that the contemplated hypothetical assessment is concerned with the damages that would have been awarded to a person in the position of Husson. Such damages would have been assessed having regard to the Wrongs Act. I consider that there is nothing in the language of the Wrongs Act or s 138 of the Act that makes Part VB inapplicable to the assessment of damages that are to be made for the purpose of factor A. As counsel for Alcoa has pointed out, if Husson were to have obtained leave to sue it under Part IV of the Act, any award made to him would have been an award of 'personal injury damages' within the meaning of that term in s 28B of the Wrongs Act.

19 Section 138 of the Act seeks 'by use of the statutory formula, a result whereby the third party tortfeasor is required to provide an indemnity for the whole of the compensation paid to the injured worker up to a limit fixed by reference to what the third party's liability would have been in a hypothetical common law action.'[11] Although not without some hesitation, Winneke P in Esso Australia Ltd v Victorian WorkCover Authority[12] adopted the construction of s 138 that was said to reflect the practice which has been adopted by the courts that have constantly dealt with claims under the Act. Relevantly, the learned President said:**

Thus, it is said that the words 'the amount of compensation paid or payable under this Act', where appearing in sub-s.(3)(a), should be read as meaning 'accrued and payable'; and that they cannot reasonably contemplate an amount produced by a calculation of all future payments which might be payable to the worker pursuant to the Act. Further, it is said that sub-s.(3)(b) is to be construed as providing a 'ceiling' to the indemnity contemplated by the section - a 'ceiling' produced, as I have said, by the third party's notional liability at common law for pecuniary and non pecuniary loss, and then reduced in accordance with the third party's share of responsibility for that loss. Construed in this way, it is said, the court can identify, once and for all, an entitlement to indemnity against a negligent third party which will not exceed that party's proportionate responsibility for the worker's notional damages at common law for pecuniary and non pecuniary loss. If the notional damages at common law, assessed in accordance with sub-s.(3)(b), are less than the amounts of compensation already paid or accrued and payable, then the entitlement to indemnity contemplated by the section remains the amount so assessed.

On appeal, the High Court[13] considered that the above construction should be accepted. And in Victoria WorkCover Authority v Anderson[14] Ashley J said:

Factor A involves consideration in some cases of an hypothetical situation. It requires an assessment of the amount of damages that the third party 'is or would have been liable to pay' were it not for the provisions of the Act and the Transport Accident Act ('TAA'). The grammar of that provision is unsatisfactory; but I think that the meaning is clear enough. Factor A requires determination of the amount of damages which the third party is liable to pay in respect of the injury or death, or the amount of damages which the third party would have been liable to pay in respect of such injury or death were it not for the provisions of the Act and of the TAA. Necessarily, the formula must embrace both factual situations.

**20 The term 'damages at common law' referred to in the passage from the decision of Winneke P was, I think, used to describe the subject of the notional assessment without any intention of excluding from consideration the operation of the Wrongs Act. The term is a convenient shorthand for describing the damages contemplated in the definition of factor A in s 138(3)(b). As counsel for Alcoa submitted, the term is used to distinguish between the restricted assessment of damages required to be undertaken under Part IV of the Act and those required to be made outside the scheme. As I have said, in the hypothetical scenario contemplated by the terms of factor A, the assessment of damages in relation to a person in the position of Husson would be subject to the requirements of Part VB of the Wrongs Act. Therefore, the notional assessment of the factor A amount is also subject to the applicable provisions of Part VB.

21 I also do not accept VWA's alternative argument that the indemnity which it pursues under s 138 of the Act falls within s 28C(2)(c) such as to exclude the Wrongs Act from the calculation of the hypothetical amount. That provision is in the following terms:**

(1) This Part applies to an award of personal injury damages, except an award that is excluded by sub-section (2).

(2) The following awards of damages are excluded from the operation of this Part -

(3) This Part extends to an award of personal injury damages even if the damages are recovered in an action for breach of contract or in any other action.

It seems to me that, on a plain reading of the provisions, and notwithstanding the width of the definition of 'damages' in s 28B of the Wrongs Act, the hypothetical damages in relation to which an indemnity is sought by VWA pursuant to s 138 of the Act do not fall within the words 'an award to which Part 4 of the ... Act applies' in s 28C(2)(c).

**22 In support of VWA's case, counsel further argued that 'award' in s 28C(1) and (2) includes the notional factor A quantification which, therefore, falls within s 28C(2)(c) such as to preclude the Wrongs Act from applying. In my view, however, this argument has no merit. As a matter of proper characterisation, the assessment of hypothetical damages made for the purposes of factor A, although falling within s 28C(1) as 'an award of personal injury damages', is not one to which Part 4 of the Act relevantly applies. As I have said, an order for an indemnity under s 138 cannot sensibly be regarded as being an 'award of personal injury damages' or one to which Part 4 of the Act applies; in context, such an order could not be said to be one for 'monetary compensation' that 'relates to the ... injury to a person caused by the default of another' within the definition of 'personal injury damages' in s 28B of the Wrongs Act. In any event, as has been pointed out, the claim under s 138 is one for a statutory indemnity and not a claim for damages. Such a construction is consistent with the observations in Hynes that 'award' in s 28C(2) is a reference to an award of common law damages which plainly is not one under Part 4 of the Act.

23 It was also submitted for VWA that the reference in s 28C(2)(c) to 'Part 4', rather than to the 'serious injury' provisions of that Part, further demonstrates an intention to exclude s 138 claims. VWA argued that an analogous argument was accepted by this Court in Hynes in respect of s 94 of the Transport Accident Act. But, as I have said, this does not assist VWA's case given that the indemnity in s 94 of that Act is of a different nature from that contemplated by s 138 of the Act.

24 VWA further contended that there was sound reason for the legislature excluding from the operation of the Wrongs Act 'Part 4 awards' (presumably including orders for indemnity under s 138), namely, the avoidance of practical difficulties that would be encountered if the matters contained in Part VB and Part VBA were to be taken into account in determining the notional damages. In the course of his submissions, counsel for VWA provided some examples of such hypothetical problems, but it is not necessary to analyse them here because they relate to the provisions of Part VBA and it has not been argued that they apply to the assessment of factor A in this case. As to Part VB I think that its application to the assessment of factor A would not impose undue impediments in the prosecution by VWA of indemnity claims under s 138. The matters are required to be taken into consideration by Part VB for this purpose are either matters of relatively straight forward calculation or matters of evidence, such as those going to gratuitous attendant care services to which reference will be made later. Such problems as may exist in the application of Part VB are, to my mind, not of such magnitude as to demonstrate an intention on the part of the legislature to exclude the operation of the Part from the assessment process.

25 In short, I am not persuaded that any of the arguments of VWA establish that there was legislative intention to quarantine proceedings for indemnity by VWA under Part 4 of the Act from the reach of the Wrongs Act. On the contrary, that the hypothetical assessment of damages for the purposes of factor A must take into account any statutory limitations on that assessment is supported by what Ashley J said in Anderson and the observations of Winneke P in Esso.

26 Thus, as I have said, I consider that his Honour did not err in concluding that, in this case, the provisions of the Wrongs Act are not excluded from the calculation of the hypothetical damages for the purposes of factor A.**

Construction of s 28IA - costs of gratuitous attendant care

**27 The third issue raised in this appeal concerns the application of the provisions of the Wrongs Act relating to Griffiths v Kerkemeyer damages to the hypothetical assessment of damages for the purposes of factor A. It was Alcoa's case below (and before us) that s 28IA of the Wrongs Act applies to the notional assessment of damages for the purposes of factor A in this case such as to exclude from the calculation the costs of gratuitous attendant care services as laid down in Griffiths v Kerkemeyer. This argument was rejected by his Honour who considered that, in this case, the provisions of s 28IA(2) do not preclude the court from making an allowance for gratuitous attendant care in the amount assessed for the purposes of factor A. Alcoa contended on appeal that his Honour erred in coming to this conclusion.

28 Section 28IA of the Wrongs Act is in the following terms:**

28IA. Limitation on damages for gratuitous attendant care

(1) No damages may be awarded to a claimant for gratuitous attendant care services unless the court is satisfied that -

(a) there is (or was) a reasonable need for the services to be provided; and

(b) the need has arisen (or arose) solely because of the injury to which the damages relate; and

(2) Further, no damages may be awarded to a claimant for gratuitous attendant care services if the services are provided, or are to be provided -

'Gratuitous attendant care services' is defined as meaning:

(a) that have or are to be provided by another person to a claimant; and

(b) for which the claimant has not paid or is not liable to pay.

**29 It seems that Husson claimed, as part of his special damages, the costs of gardening and home maintenance work, which had been carried out by him prior to his injury but which were thereafter performed by his wife. As I have said, his Honour rejected Alcoa's contention that there was no entitlement to such a claim because the services in question fell within para (a) of sub-s (2). The judge rejected the claim that the sub-section was to be read disjunctively and accepted VWA's argument that, on the proper construction of sub-s (2), both paras (a) and (b) must be satisfied before the prohibition in sub-s (2) would operate. It follows on such a construction of the provision that, if the gratuitous service is of a kind that is for a period that is longer than that prescribed in either of the two paragraphs, the prohibition in the sub-section against claiming costs of gratuitous attendant care is not triggered. In coming to the impugned conclusion his Honour preferred, contrary to the submissions of Alcoa, the decision in that regard of the Queensland Court of Appeal in Grice v State of Queensland[15] ('Grice') (that relevantly said that a similar provision in the Queensland legislation should be read conjunctively) to that of the New South Wales Court of Appeal in Geaghan v D'Aubert[16] ('Geaghan') (which supported the argument that the requirements in the corresponding provision of that State are to be read disjunctively).

30 His Honour went on to find that the evidence did not satisfy him that Husson's wife had undertaken more than one hour per week of voluntary domestic work that would otherwise have been undertaken by him. In any event, said his Honour, Husson's loss of capacity to undertake gardening and other maintenance tasks may in part be seen as a loss of recreational opportunity for which he had already been compensated. In the circumstances, therefore, the service that was provided to Husson fell within para (a). Nevertheless, his Honour said, the requirements for such service could continue 'indefinitely', which meant that the service provided was not caught by para (b). Consequently, on his Honour's construction of sub-s (2), it meant that the provision did not preclude, for the purposes of the factor A calculation, a claim for damages for gratuitous attendant care services in accordance with the principles in Griffiths v Kerkemeyer.

31 Nevertheless, in order to be entitled to pursue such a claim, the exceptions to the prohibition contained in sub-s (1) had to be satisfied. As to that, his Honour recognised, essentially by reference to the decision in Kars v Kars,[17] that the underlying basis of Griffiths v Kerkemeyer damages claim is the demonstrated 'need' for services consequent upon the injuries, an element that his Honour said was entrenched in s 28IA(1)(a) and (b). His Honour said that he was satisfied on the evidence of the existence of the relevant 'need' and that, in the circumstances, exceptions to sub-s (1) have been made out.

32 As I have mentioned, Alcoa's case was that, given his Honour's conclusion that the circumstances specified in s 28IA(2)(a) of the Wrongs Act were present here, the section excluded Griffiths v Kerkemeyer damages in this case. Thus, Alcoa contended, Husson was not entitled to claim the cost of gratuitous attendant care services even if he satisfied the 'need' requirements of sub-s (1). The submission was based on the proposition that the paragraphs in sub-s (2) should be read disjunctively as was decided in Geaghan.

33 VWA argued that there is no warrant for reading sub-s (2) disjunctively. The words should be given their ordinary and natural meaning so that 'and' should be taken, consistently with its ordinary meaning, to require the sub-section to be read conjunctively as was done in Grice in respect of a like section in the corresponding Queensland Act. It was said that 'and' cannot be properly read as 'or' as Alcoa would have it because that would restrict the claimant's previous common law right beyond that which was intended to be achieved by Parliament and there is no apparent statutory intention to do this in the provision. VWA further submitted that, essentially for the reasons set out in Grice, the decision in Geaghan is not relevant to the interpretation of sub-s (2).

34 Counsel for Alcoa submitted that it was not appropriate in this case to give a literal meaning to s 28IA(2) and that its true meaning was to be gleaned from extrinsic materials. It was pointed out that sub-s (2) creates a threshold that the claimant must overcome before becoming entitled to recover costs of gratuitous attendant services. Counsel emphasised that the legislation that introduced, amongst other provisions, s 28IA was based on the recommendation of the Ipp Report[18] that essentially recommended that the entitlement for recovery of damages for gratuitous services be available only if they are provided at least six hours per week and for at least six months. Moreover, it was said, that the relevant aspects of the 2003 amendments were based on the Ipp Report was made plain by the Attorney-General in his Second Reading Speech in relation to the Bill containing the provision in question. Counsel argued that the extraneous material, the circumstances in which the amending legislation was introduced and the context in which s 28IA(2) is to be found in the Act support the view that this Court should follow Geaghan.

35 In the circumstances, it is necessary to refer a little more fully to Geaghan and Grice. The New South Wales case concerned claims for damages for gratuitous services. The relevant section in the corresponding New South Wales Act was s 72(2) which was in the following terms.**

No compensation is to be awarded if the services are provided ...

It is apparent that the provision is, in terms, relevantly identical to s 28IA(2) of the Wrongs Act. Thus, section 72(2) provides that the prohibition against recovery of damages for gratuitous services only arises if the services are of the kind described in paras (a) and (b). In other words, unless the services are so limited, the prohibition against claiming damages for such services does not operate. The ordinary natural meaning of the words of the section, I think, would justifiably lead to the conclusion that, unless both matters in the paragraphs are present, there would be no prohibition against claiming such damages.

36 But the court in Geaghan concluded that a literal or ordinary meaning cannot properly be attributed to those words because of the legislative history of the section and the object of the legislation. It was said that the section operated so that no compensation was to be awarded if either of the paragraphs attached. Thus, the paragraphs were read disjunctively (in effect, substituting for 'and', the word 'or') instead of conjunctively as would seemingly follow from a plain reading of the words. The legislative history in that case was, with respect, relevant to the court's conclusion in that regard. The predecessor to that provision made it plain that if the standard of gratuitous service did not meet one or other of the sub-paragraphs of the section no claim could be made for the costs of gratuitous services. The criteria that had to be satisfied - as to the hours of service and the period of it - were subject to two separate sub-sections. They read as follows:

No compensation shall be awarded unless the services are provided ... for not less than six months and may be awarded only for services provided ... after the six month period.

No compensation shall be awarded unless the services provided ... are not less than six hours per week and may be awarded only for services provided ... after the first six hours.

**37 It is plain, as the court said in Geaghan, that, under that provision, in order to be entitled to claim for such services the claimant would have to establish that both requirements of s 72 were satisfied. It is to be noted that the former section was in a form that was relevantly different from s 72(2) that was considered in Geaghan. The intention of the previous provision was to preclude such a claim for gratuitous services being made if the circumstances described in one of the paragraphs applied. It was in that context that the court in Geaghan said that it was open to it to have regard to extrinsic materials surrounding the amending legislation, more particularly, the Attorney-General's Second Reading Speech of the Bill which made it plain that, unless the gratuitous services were provided for each of the two required periods, no claim could be made for such costs. Moreover, the court said, the New South Wales legislation contains 'extensive' object provisions which bear on the construction of s 72(2). In the circumstances, the court construed the provision in the way Alcoa would have us do in respect of s 28IA(2).

38 Grice distinguished Geaghan, as has been noted, essentially on the basis of the absence in the Queensland legislation of matters that went to support the construction of the New South Wales provision by the Court of Appeal of that State. This included the legislative history of the New South Wales provision, the stated objects of the Act and the Attorney-General's Second Reading Speech. The Queensland provision that corresponded to s 72(2) of the New South Wales Act was s 54(2) that was in the following terms.**

(2) Damages are not awarded for gratuitous services if the services are provided, or are to be provided -

Again, it is apparent that this sub-section is relevantly identical to the corresponding provisions in the New South Wales Act and s 28IA(2). In each case the prohibition against being awarded damages for gratuitous services is stated to operate only if they fit the description in paras (a) and (b). I have already explained why the court in Geaghan did not read the paragraphs conjunctively. As has been noted, the court in Grice recognised that the legislative history, the extraneous materials and the objects of the legislation that operated in New South Wales had no equivalent in Queensland. And it rejected the appellant's claim in that case that the sub-section should be construed in the context of the extrinsic material that related to the legislation including the Second Reading Speech of the Attorney-General in which it was said said, amongst other matters, that the Bill provides that 'an award for gratuitous services can only be paid if the service is required for a minimum of six hours per week and for a minimum of six months.' On its face, the speech suggests that if the claimant cannot make out one of the requirements for service, there would be no entitlement to claim damages in respect of it. As McMurdo P, who delivered the principal judgment observed, those words are inconsistent with the enacted s 54(2). The court also rejected the appellant's submission that s 54(2) was copied from the New South Wales legislation so that, in the circumstances, the court should follow Geaghan. The learned President said that the ordinary, plain meaning of the words of the sub-section was that the claimant's entitlement to damages for gratuitous services was not lost merely because they were of a kind that fell within one of the paragraphs of the sub-section. In other words, her Honour concluded that the sub-section should be read conjunctively such that there was no relevant disentitlement unless the service was of a kind that fell within both paragraphs. An important consideration that moved her Honour to reach that conclusion was that, prior to the coming into operation of s 54(2), the respondent had an 'unfettered right to seek damages for gratuitous services [and] ... a statute will only be regarded as limiting such a common law right if it does so clearly and unambiguously'.[19]

39 The starting point in seeking to ascertain Parliament's intention as to the meaning of s 28IA(2) is to give the words used by the legislation their ordinary and natural meaning in the context of the Act[20] and relevant legislative history.[21] As Callaway JA pointed out in R v Best,[22] extrinsic materials are an aid to construction not a substitute for legislation. And although it seems plain enough that, in construing the legislation, the court may have regard to extrinsic materials to ascertain the purpose of the legislation even if it considers that there is no ambiguity in the language it is not bound to do so.[23] As Winneke P pointed out in Masters v McCubbery[24] in the context of discussing the operation of s 35 of the Interpretation of Legislation Act 1984:

... the court needs to be careful not to permit recourse to this section to undermine its primary function of seeking to ascertain the intention of the legislation from the content of the Act itself.

**40 I consider, as I have indicated, that on the ordinary meaning of s 28IA(2) the prohibition against damages claims for gratuitous services does not operate unless they are of a kind that fall within both paragraphs. Thus, for example, if the services provided to Husson as found by his Honour fell within para (a) but not para (b), he would nevertheless be entitled to claim the amount as damages, subject to satisfying the requirements of sub-s (1).[25] In my view, there is no apparent justification for reading 'and' as 'or' as Alcoa would have it. I think that a critical difference between this case and Geaghan is the absence here of the legislative history that was so important to the conclusion in Geaghan.

41 I also consider that, in any event, the extrinsic materials to which Alcoa pointed do not assist its case on this issue. It is true that, in his Second Reading Speech for the Bill that introduced the 2003 amendments, the Premier referred to the provisions dealing with the right to claim damages for gratuitous services as being based on the Ipp Report. He said:[26]**

In line with recommendations of the Ipp report, the bill restricts access to damages for gratuitous attendant care to those cases where the need for this care is clearly the result of the injury and the care is required for at least 6 hours a week for at least six months. The maximum amount awardable for gratuitous attendant care is limited to payment for no more than 40 hours a week at an hourly rate that does not exceed one-fortieth of average weekly earnings in Victoria. This provision mirrors those being introduced in most states.

There are a number of obvious errors in that part of the speech to which I will refer later. But first it is necessary to mention the relevant aspects of the Ipp Report which, in general terms, was concerned with the just and practical way of limiting the quantum of awards of damages for negligently caused personal injury or deaths. The Report accepted that 'there [was] a reasonable level of acceptance within the community that some compensation should be payable for gratuitous services'[27] and did not recommend that such claims for compensation be abolished. A little later, the authors of the Report pointed out, in broad terms, that the New South Wales and Queensland legislation provides for 'a threshold for damages for gratuitous services based on the requirement that the services be provided for six hours per week for six months.'[28] The Report went on to recommend that 'the threshold presently in place under the civil liability and motor accident legislation in NSW should be adopted nationally.'[29] It essentially said that the legislation should embody principles that would include the following:

(a) Damages for gratuitous services shall not be recoverable unless such services have been provided or are likely to be provided for more than six hours per week and for more than six consecutive months.[30]

42 Thus, what the Ipp Report relevantly recommended was that a claimant should not be entitled to damages for gratuitous services unless it was established that they were of a kind that satisfied both requirements. Such a recommendation is the opposite of what the Victorian Parliament ultimately enacted in 2003 by way of Act No. 60,[31] more particularly, by introducing into the Wrongs Act for the first time limitations in respect of claims for damages for gratuitous services in the form of s 28IA. As I have noted, in my view the plain meaning of sub-s (2) is that the restriction prescribed by it only comes into operation if requirement for services is such that it falls within both paragraphs of the sub-section. That the Premier mis-described the operation of the provision and erroneously assumed that it was reflecting the abovementioned recommendation in the Ipp Report is not to the point. First, this aspect of the legislation formed but a small part of the subject matter of the Premier's speech and, in terms of significance so far as legislative changes were concerned, was a relatively minor matter. It is unsurprising, therefore, that his reference to the proposed restriction on claims for costs of gratuitous services was in very broad terms and was probably made without his having been fully briefed on the difference in the operation of the respective provisions in New South Wales and Queensland, or as to the operation of the words in sub-s (2) that he was introducing. But what matters in the end is the language of Parliament and not the brief

statements, made in general terms, of the Premier of his view as to the operation of the sub-section. In Re Bolton; Ex parte Beane[32] the majority said:

The words of a Minister must not be substituted for the text of the law. Particularly is this so when the intention stated by the Minister but unexpressed in the law is restrictive of the liberty of the individual. It is always possible that through oversight or inadvertence the clear intention of the Parliament fails to be translated into the text of the law. However unfortunate it may be when that happens, the task of the Court remains clear. The function of the Court is to give effect to the will of Parliament as expressed in the law.

And in Minister for Immigration and Ethnic Affairs v Tang Jia Xin[33] their Honours said:

However, a minister's second reading speech, while available as a guide to interpretation, cannot be determinative of or substituted for the text of the legislation. This is particularly so where the law is restrictive of the liberty of the individual.

A consideration relevant to this question, that is not unimportant, is that, prior to the 2003 amendments, claimants such as Husson had a relevantly unfettered right to seek damages for gratuitous services. Clear and unambiguous words are needed before it can be said that it is the intention of Parliament to limit those rights to the extent contended for by Alcoa. For the reasons I have given, I consider that no such intention is manifested by the terms of s 28IA(2).

1"> 43 It follows that the contention of Alcoa that his Honour erred in allowing an amount for gratuitous services provided to Husson for the purposes of the s 138 calculation must be rejected.

44 For the reasons given, I would dismiss the appeal and the cross appeal.

45 I have had the advantage of reading the reasons of Maxwell ACJ and Chernov JA in draft. I too would dismiss the appeal and cross-appeal, for the

reasons given by Chernov JA. I agree with Maxwell ACJ that the Victorian WorkCover Authority's submission, that s 138 (3)(a) of the Accident Compensation Act 1985 entitles it an indemnity for the costs of medical reports, has no merit. I wish only to make some brief comments on the construction of s 28IA of the Wrongs Act 1958.

**46 In Griffiths v Kerkemeyer[34] the High Court held that a person who was injured as the result of another's negligence was entitled to damages for the value of services provided to him or her gratuitously by a relative or friend, even though the injured person was not legally liable to pay for those services. The rationale for holding the defendant liable to compensate the plaintiff for gratuitously provided services, was that the injured person's need for care was caused by the defendant's negligence.[35] Alternatively, it was said that the defendant should not benefit from the provision of care to the plaintiff, simply because those services were voluntarily donated.[36] As a practical matter, the principle in Griffiths v Kerkemeyer ensured that if family arrangements to care for an injured plaintiff broke down (for example because a family member was no longer able to provide the necessary care) the plaintiff's damages assisted him or her to pay for necessary services.

47 Section 28IA of the Wrongs Act 1958 was introduced in 2003[37] as part of a package of legislative changes intended to reduce the quantum of damages awards, following government concerns about the high cost of negligence claims and a perceived threat to the financial viability of some insurers.[38] The second reading of the Wrongs and Limitation of Actions Acts (Insurance Reform) Bill said that 'the reforms ... are designed to balance the rights of people to have access to courts to sue for personal injuries and the need to access affordable insurance.'[39] This objective is also apparent from s 28IA, which limits the circumstances in which injured people are entitled to an award for gratuitous care, whilst at the same time ensuring that people with more serious injuries who need ongoing care remain entitled to receive compensation for gratuitous care.

48 The plain words of the section prohibit the award of damages for gratuitous attendant care services only if both conditions in s 281A are satisfied - that is if the plaintiff requires services for less than 6 hours per week and for less than 6 months. In this way the section ensures that a negligently injured person who needs more than 6 hours of care or who needs care which will continue beyond 6 months, is entitled to damages for gratuitous attendant care.

49 In Grice v State of Queensland[40] the Queensland Court of Appeal held that this was the effect of s 54(2) of the Personal Injuries Proceedings Act 2002,[41] which is in relevant respects identical to s 28IA of the Wrongs Act. The Court declined to follow the New South Wales Court of Appeal decision in Geaghan v D'Aubert,[42] which held that s 72(2) of the Motor Accidents Act 1988 (NSW) (which is also expressed in similar terms to s28IA) required a plaintiff to satisfy both the 6 hours and the 6 months requirement in order to be entitled to Griffiths v Kerkemeyer damages. As McMurdo P explained in Grice, the decision in Geaghan, reflected the legislative history of s72(2). The original form of s 72 of the Motor Accidents Act 1988 (NSW) clearly required the plaintiff to satisfy both these requirements.[43]

50 I agree with Chernov JA, for the reasons that he gives, that this Court should follow Grice. The words of s 28IA do not support a construction of the section which requires the word 'and' to be read as 'or.' Section 28IA of the Wrongs Act limits the damages which would otherwise be payable to meet the needs of a plaintiff injured as the result of another person's negligence. The approach in Geaghan means that a person who is injured so seriously that they require full-time care for up to six months after their accident or require regular care for fewer than 6 hours a week for the rest of their lives, is not entitled to any compensation for their need to receive gratuitous care. Legislation which shifts a substantial portion of the costs of negligently caused injury from tortfeasors[44] to injured plaintiffs, by restricting the right to recover damages for gratuitous care, must be expressed clearly and unambiguously.[45]

51 I would therefore dismiss the appeal and the cross-appeal.

[1] Alcoa Portland Aluminium Pty Ltd v Husson [2007] VSCA 209.

[2] [2000] VSCA 74; (2000) 1 VR 246, 252. This explanation was confirmed by the High Court on appeal: Victorian WorkCover Authority v Esso Australia Ltd (2001) 207 CLR 520, 530 (Gleeson CJ, Gummow, Hayne and Callinan JJ).

[4] R v Peters (1886) 16 QBD 636, 641 (Lord Coleridge CJ); Pearce and Geddes, Statutory Interpretation in Australia (6th ed, 2006) [3.30] and the cases cited therein.

[7] Halsbury's Laws of Australia, 4th ed, [1123].

[8] [2006] HCA 8; (2006) 80 ALJR 646, 653 (Gleeson CJ, Gummow, Kirby and Hayne JJ).

[10] [2007] VSCA 7, [27], [64].

[11] Metron Medical Australia Pty Ltd v Victorian WorkCover Authority [2007] VSCA 40, [139] (Bongiorno AJA).

[13] Victorian WorkCover Authority v Esso Australia Ltd (2001) 207 CLR 520, 530 (Gleeson CJ, Gummow, Hayne and Callinan JJ).

[18] Review of the Law of Negligence Final Report, September 2002.

[19] Her Honour referred to Potter v Minahan [1908] HCA 63; (1908) 7 CLR 277, 304 (O'Connor J), Bropho v Western Australia [1990] HCA 24; (1990) 171 CLR 1, 18 (Mason CJ, Deane, Dawson, Toohey, Gaudron and McHugh JJ) and Coco v The Queen [1994] HCA 15; (1994) 179 CLR 427, 437 (Mason CJ, Brennan, Gaudron and McHugh JJ).

[20] Nokes v Doncaster Amalgamated Collieries Ltd [1940] AC 1014, 1022 (Viscount Simon LC); Kingston v Kerpose (No. 2) (1987) 11 NSWLR 404, 423 (McHugh J); Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297, 305-6 (Gibbs CJ).

[21] See, eg, CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384, 408 (Brennan CJ, Dawson, Toohey and Gummow JJ).

[22] [1998] 4 VR 603, 610. See also Mills v Meeking [1990] HCA 6; (1990) 169 CLR 214, 235 (Dawson J).

[23] See, for example, Humphries v Poljack [1992] VicRp 58; [1992] 2 VR 129, 136 (per Crockett and Southwell JJ) and Mills v Meeking [1990] HCA 6; (1990) 169 CLR 214, 223 (Mason CJ and Toohey J).

[25] As I have already mentioned, the learned judge found that those requirements have been satisfied in this case and no challenge is made to that finding.

[26] Victoria, Parliamentary Debates, Legislative Assembly, 21 May 2003, 1786 (Steve Bracks, Premier).

[27] Review of the Law of Negligence Final Report, September 2002, 201.

[31] Wrongs and Limitation of Actions Act (Insurance Reform) Act 2003.

[32] [1987] HCA 12; (1987) 162 CLR 514, 518 (Mason CJ, Wilson and Dawson JJ).

[33] [1994] HCA 31; (1995) 69 ALJR 8, 11. See also Nominal Defendant v GLG Australia Pty Ltd [2006] HCA 11; (2006) 80 ALJR 688, 693 (Gleeson CJ, Gummow, Hayne and Heydon JJ).

[35] Ibid 172, 175 (Stephen J), 191-3 (Mason J). See also Kars v Kars [1996] HCA 37; (1996) 187 CLR 354.

[36] Ibid 168 (Gibbs J) 171 (Stephen J) 191-3 (Mason J).

[37] Wrongs and Limitation of Actions (Insurance Reform) Act 2003.

[38] Following the Ministerial Meeting on Public Liability Insurance on 30 May 2002, the Commonwealth in consultation with the States and Territories agreed to jointly appoint an expert panel of eminent persons to examine the law of negligence. The terms of reference began by stating '[t]he award of damages for personal injury has become unaffordable and unsustainable as the principal source of compensation for those injured through the fault of another. It is desirable to examine a method for the reform of the common law with the objective of limiting liability and quantum of damages arising from personal injury and death.': Panel of Eminent Persons (Ipp Committee), Review of the Law of Negligence Report (Final Report, 2 October 2002) ix. On 23 March 2001, the Australian Health Ministers Advisory Council (AHMAC) set up the Legal Process Reform Group, to 'consider legal changes which [would] help to reduce rising medical indemnity premiums': Australian Health Ministers Advisory Council Legal Process Reform Group, Responding to the Medical Indemnity Crisis: An Integrated Reform Package (2002), Executive Summary [1.1]. For a critical overview of the reforms see Harold Luntz 'The Australian Picture' (2004) 35 Victoria University of Wellington Law Review 879 and Fiona Tito Wheatland 'Medical Indemnity Reform in Australia: "First Do No Harm"' (2005) 33 The Journal of Law, Medicine & Ethics 429.

[39] Victoria, Parliamentary Debates, Legislative Assembly, 21 May 2003, 1781 (Steve Bracks, Premier).

[41] The provision has since been replaced by the Civil Liability Act 2003 ( Qld) s 101.

[43] [2002] NSWCA 260, [24]-[29] (Stein JA). His Honour also referred to the second reading speech introducing the legislation.

[44] In reality the insurers of tortfeasors.

[45] Grice v State of Queensland [2005] QCA 272; [2006] 1 Qd R 222, 229 (McMurdo P).

Compensation Act 1985

Accident Compensation Act 1986

Legislation Act 1984

Injuries Proceedings Act 2002

Limitation of Actions (Insurance Reform) Act 2003

Compensation Act 1985

Accident Compensation Act 1986

Legislation Act 1984

Injuries Proceedings Act 2002

Limitation of Actions (Insurance Reform) Act 2003

At a glance

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Legislation Cited (16)

Cases Cited (16)