Consideration
26Mr Russell has submitted that a question of fact to be determined by this Court is whether "there really has been a double recovery in the present case." That question must be answered in the negative for the simple reason that the DDB has not paid anything at all to the plaintiff. There are really two questions before me: if the DDB is required to pay benefits to the plaintiff (a) will there be or (b) might there be a double recovery? I am hesitant about my jurisdiction to answer such questions, questions about the future, but neither party has addressed me about or even adverted to the question of jurisdiction.
27There is, however, one question of fact which I can determine. I am not persuaded on the balance of probabilities that Amaca did not take into account in forming its offer of compromise that the plaintiff might be entitled in futuro to benefits from the DDB. As I recited in [8] above Ms de Brouwer's supervising partner, Mr O'Brien, swore an affidavit supporting Amaca's application to cross-vest the plaintiff's claim to New South Wales, in which he deposed to the plaintiff's potential entitlements to statutory benefits from the DDB. This was also referred to by Hollingworth J in her reasons of 7 March 2013 in which her Honour pointed out that if the plaintiff obtained such statutory benefits, Amaca would be required to reimburse the DDB pursuant to s 8E of the Dust Act. At [10] above, I recited the forensic accounting report of Ms Tamara Lindsay, qualified on behalf of Amaca, which asked her to assume that the plaintiff might be entitled to DDB benefits and to Ms Lindsay's calculations concerning such benefits. When requesting particulars on 19 February 2013, Ms de Brouwer asked this:
"Please advise whether your client has applied to the [DDB] for any benefits, whether his application has been accepted and, if so, what benefits he is receiving."
Unfortunately, Mr Dimsey did not answer that question in his response of 25 February 2013. However, the important point is that Amaca, through its solicitor, was well aware of the plaintiff's, at least, potential entitlement to statutory benefits. At [19] above I discussed Ms de Brouwer's letter of 20 May 2013 to the DDB and provided my finding as to its proper construction. At [25] above, I discussed the oral evidence of Ms de Brouwer, in particular what she did not say, and Mr Russell's submissions about her evidence. I accept those submissions as proper inferences to be drawn from the facts of this matter and from the evidence of Ms de Brouwer and therefore cannot find that Amaca has not complied with its obligation under s 8E of the Dust Act. That, of course is only a finding which binds the present plaintiff and the DDB. That finding cannot bind Amaca which is not a party to this appeal.
28It follows from my last finding that I cannot find that if the plaintiff be paid statutory benefits by the DDB that there will be a double recovery. It follows that the plaintiff is entitled to an award of statutory benefits. However if I be wrong in reaching that conclusion, and because of the arguments of counsel, I shall consider the matter further.
29The prohibition of double compensation is well enshrined in our common law. However, it is a principle of the common law. In SAS Trustee Corporation v Budd [2005] NSWCA 366; (2005) 3 DDCR 382 the Court was called upon to consider s 12E of the Police Regulation (Superannuation) Act 1906 which, inter alia, required any lump sum gratuity payable under s 12D of that Act to be reduced by any compensation paid to the claimant under the Victims Compensation Act 1996. Mason P (with whom Handley and McColl JJA agreed) said:
"32. Section 12E(2) seeks to prevent the injustice of double compensation. In one sense it goes no further than ensuring that a common law principle of general application is not overlooked when considering the unusual juridical concept of a statutory entitlement to a "gratuity". The provision reinforces the application of a general principle frequently applied in relation to statutory schemes for the payment of damages or compensation (see generally Boncristiano v Lohmann [1998] 4 VR 82 at 89, Franklins Self Serve Pty Ltd v Wyber [1999] NSWCA 390; (1999) 48 NSWLR 249 at 254).
33. The rule against double compensation may be invoked by one or more defendants. If it can be shown that the plaintiff/claimant has already received recompense in any form in respect of the loss for which compensation is claimed against the defendant invoking the rule, then the plaintiff's loss requiring compensation from that defendant is regarded as discharged pro tanto. To award compensation with respect to that loss against that defendant would be to permit double recovery by the plaintiff in respect of a loss no longer calling to be compensated."
The development of the principle has been outlined by Campbell JA in Downes v Amaca Pty Ltd at [79] to [92]. In our legal system, the Queen in Parliament is sovereign. Parliament can enact laws, amend laws and repeal laws. It can vary, amend and repeal the common law. If Parliament provides a statutory right or statutory benefit the grantee of the right or benefit can not be deprived of it by the common law except in certain cases by the principles of waiver and estoppel.
30It has long been established that the recovery of damages at common law does no affect a worker's right to recover statutory benefits under the Dust Act and, therefore, a worker's common law damages are to be reduced to reflect that entitlement. In Downes v Amaca Pty Ltd Basten JA outlined the basic position thus:
"7. The entitlement to damages in the present case arose under the general law; the entitlement to payment of benefits from a statutory fund arose under the Dust Diseases Act. Where a person has an entitlement to both, questions will arise as to whether recovery of both involves double compensation, whether when damages are recovered, an obligation to refund the compensation payments arises or whether the damages are to be reduced by the amount of the compensation receivable.
8. In Manser v Spry [1994] HCA 50; 181 CLR 428, the High Court had held (in relation to similar legislation in South Australia) that a deduction should be made on the basis that (at 439):
'The compensation benefits paid or payable under the Act are ordinary incidents of a worker's employment which must be taken into account in assessing the damages of a plaintiff-employee for loss and damage for which a tortfeasor is liable at common law.'
9. For that reason, in Manser the Court held that the plaintiff was not entitled "both to receive and retain compensation by way of weekly payments ... and to recover damages in the common law action assessed without reduction on account of compensation received or to be received": at 432. The conclusion in Manser does not directly apply in this case, as in Manser the authority responsible for paying compensation had no right to obtain recoupment from an award of damages. Section 8E (discussed below) has expressly varied that situation.
10. It was authoritatively established in Harris v Commercial Minerals Ltd [1996] HCA 49; 186 CLR 1, in relation to the Dust Diseases Act, applying principles enunciated in Manser at 434-437, that double recovery was not permitted and, to avoid that result, that benefits payable as compensation for economic loss suffered as a result of work injuries falling within the scope of the Act, were to be deducted from any award of damages against an employer in respect of those injuries: at 18. In that case, the present value of the future benefits payable under the Dust Diseases Act was held to be deductible from the damages: at 16.
11. Harris is distinguishable in two respects from the present case. First, it was a case in which the worker's entitlement had already been accepted by the Board prior to the judgment for damages. The trial judge in Harris had deducted amounts already paid, so that the only issue related to future benefits payable pursuant to an entitlement which had been accepted by the body responsible for making the payments.
12. A somewhat different issue arises in respect of cases where no such entitlement has been made out at the date of judgment in the damages proceedings."
His Honour went on to consider CSR Ltd v D'Arcy (1996) 40 NSWLR 721 and James Hardie and Co Pty Ltd v Newton (1997) 42 NSWLR 729 and then said:
"22. The principles which are to be derived from D'Arcy and Newton are not beyond doubt, but appear to include the following:
(1) where a person has a clear entitlement to a benefit under the Dust Diseases Act, his failure to obtain the benefit must be assessed in terms of mitigation of loss, the onus being on the respondent to establish that the claimant's conduct in not seeking the benefit was unreasonable; and
(2) where the entitlement to the benefit has not been accepted by the Board, the possibility that a benefit will be payable in the future must be assessed on the basis that it is an hypothetical event, in accordance with Malec principles."
To deal with the factual circumstances arising in that case his Honour then set out the five principles which I quoted in [22] above. In the same case, Campbell JA said in [93]:
"93.There is no provision in the Dust Act or any connected legislation that provides for benefits to cease, or for the worker to repay any of the benefits received in the past, if the worker receives an award of damages.."
His Honour went on to conclude thus:
" 116. In my view, it remains the law that if a worker has a legal right to apply for a benefit under the Dust Act, but has not applied for that benefit, the present value of that benefit can be deducted from damages only if either:
(i) there is a finding that the worker is likely to apply for the benefit and would then obtain it, or
(ii) there is a finding that the failure of the worker to apply for the benefit is, or would be, an unreasonable failure to mitigate damages.
117. In the present case the Tribunal did not proceed in either of those fashions. The finding that the Tribunal made, that if the Appellant re-applied to the Dust Diseases Board he would be certified as disabled and entitled to receive the prescribed benefits, is insufficient as a matter of law to lead to the conclusion that the benefits should be deducted, when questions of whether the worker would actually reapply, and of whether, if he did not, his failure to do so would be an unreasonable mitigation of damage, were not gone into. In my view, the matter should be remitted to the Tribunal to reconsider the extent, if any, to which a deduction should be made for past and future medical expenses and future care.
118. The capacity for workers to receive a windfall gain on this view of the law is quite limited. If the worker has not applied for a benefit at the time of seeking damages, or (as the judge in the present case thought was the Appellant's situation) has applied and been rejected, but has suffered a material deterioration in his condition since being rejected, it is for the defendant to raise an issue about whether, in the situation as it is at the time of the trial, the worker's failure to have made a recent application is an unreasonable failure to mitigate damages. It is only in the situation where such an issue is raised, and it is held that the failure to apply is reasonable, and the worker later applies for and obtains benefits, that the worker will obtain a windfall gain. The possibility of there being such a windfall gain is a consequence of the legislation that Parliament has enacted."
Handley AJA said:
"132. The 1942 Act does not terminate a worker's right to future benefits when damages are recovered. His statutory rights are not affected, and future benefits are "deducted" from his damages at common law to prevent over compensation."
In the following paragraph his Honour pointed out the deduction was not made under s 8E of the Dust Act, but at common law, on the principle prohibiting double recovery. Section 8E "operates on that deduction whatever it might be and however it was assessed." His Honour went on to say:
"136. The statutory scheme is clear. The plaintiff, despite recovering damages for his dust disease, remains entitled to benefits under the 1942 Act. If, prior to s 8E, a plaintiff's damages were reduced, the wrongdoer got the benefit, and the Board bore the expenses. Section 8E transfers this benefit from the wrongdoer to the Board which can recover the benefit as a debt."
31In the current case I do not know if any deduction was made by Amaca from its assessment of the plaintiff's damages which led to its offer of compromise. If a deduction were made I do not know how it was calculated. The evidence is silent on those issues. As I have already stated, I can not find that no such deduction was made. Clearly, Amaca ought to have made a deduction. It runs the risk of paying twice. Section 8E(3) provides:
"(3) Reimbursement where damages recovered If:
(a) a person (the first person) recovers damages from some other person (the second person ) in respect of the disablement or death pursuant to the final determination of the relevant proceedings, and
(b) there is deducted from the damages the amount of any compensation already paid to the first person under this Act, or the present value of future benefits payable to the first person under this Act, or both,
the following provisions have effect:
(c) the second person is liable to pay to the board an amount equal to the amount or amounts so deducted,
(d) the amount that the second person is liable to pay under this subsection is payable within 42 days after recovery of the damages or within such other period as is provided by Schedule 1A or prescribed by the regulations or as is (subject to the regulations) allowed by the board,
(e) the amount that the second person is liable to pay under this subsection, or any unpaid portion of it, together with interest as provided by Schedule 1A, is recoverable by the board in a court of competent jurisdiction as a debt owing to the board."
Section 8E(8) provides:
"(8)Determination of amount of compensation In a case in which the deduction from damages referred to in subsection (3)(b) is not apparent or readily ascertainable from the terms of any judgment or award in respect of the damages, the amount of the deduction is as determined in accordance with Schedule 1A."
Section 8E(10) provides definitions which defines "damages" to include damages payable under a settlement and "final determination" to include "final determination by settlement, agreement, dismissal, discontinuance or otherwise." The settlement effected in the present case clearly, in my view, falls within the purview of section 8E.
32In my view it is irrelevant that Mr Dimsey, in making this calculation of the plaintiff's damages included his past medical expenses and hospital expenses and made a provision for future medical expenses. This evidence was given:
"[HIS HONOUR:]
Q. Assume this, Mr Dimsey: were the expenses still outstanding and were paid by the Dust Diseases Board, then if her Honour's view of the law is correct, then the Dust Diseases Board would be entitled to recover expenditure from Amaca; correct?
A. Yes.
Q. So ultimately Amaca would have to pay, ultimately as tortfeasor; correct?
A. Yes, your Honour. Yes.
Q. So that if Amaca has paid the expenses, then really there's no recourse to the Board because the expenses have been paid. There's nothing outstanding, in other words.
A. Yes, I see. Thank you. My difficulty is that Amaca paid a sum of money and from that money the private health insurer put its hand up for reimbursement. But Mr Arentz maintained his entitlement to have his medical expenses paid. So it's a situation in which, while at one level all of these ingredients went into the mix, we say that at that time my position for him was that he still had the entitlement to those expenses being paid by the Board and that the fact that he had to make reimbursement himself didn't concede that point that was required of him by his contract with his private health insurer.
SHELLER
Q. But, Mr Dimsey, for that situation to apply, can I suggest, you would not have put on the table in your negotiations with Amaca for the settlement of Mr Arentz's common law claim, medical expenses?
A. We had to, because we didn't have an accepted DDB claim. We couldn't not claim and then be left short. We had to claim."
The point made by Mr Dimsey is perfectly valid. He had no option other than to include medical and hospital expenses in his client's claim. Had the DDB not vacillated and accepted the plaintiff's claim, as Mr Dimsey had asked it to do, the present proceedings may have been completely unnecessary.
33It follows from this reasoning that the plaintiff's right to statutory entitlements is not defeated by his common law settlement or by any default of Amaca in doing what the law required it to do.
34I propose the following orders but will hear the parties on any other appropriate form of orders:
(a)Appeal allowed.
(b)The determination of the DDB made on 15 August 2013 which was communicated to the plaintiff by letter dated 16 August 2013 is set aside.
(c)I make an award for the plaintiff for weekly payments for total disablement commencing on 30 October 2012 to continue until the plaintiff's death.
(d)I make an award for the plaintiff under section 8(2)(d) of the Dust Act.
(e)I order the defendant to pay the plaintiff's costs of this appeal.