MATTER : Application for a Writ of Certiorari against Mr Ross Monger as Director of the Conciliation & Review Directorate

Workers' compensation - Significant disability - Whether question of degree of disability may be referred to Director after time for election

Workers' Compensation and Rehabilitation Act 1981, (WA) s 93D(5), s 93E(3)(b)

Brettingham-Moore v St Leonards Municipality [1969] HCA 40; (1969) 121 CLR 509

Counsel of Civil Service Unions v Minister of the Civil Service [1985] 1 AC 374

Craig v South Australia [1995] HCA 58; (1995) 184 CLR 163

Formosa v Secretary, Department of Social Security [1988] FCA 291; (1988) 81 ALR 687

Hot Holdings Pty Ltd v Creasy (1996) 185 CLR 149

Hunter Resources v Melville [1988] HCA 5; (1988) 62 ALJR 88

Paull v Munday (1976) 50 ALJR 551

R v Greater London Council; Ex Parte Blackburn [1976] 1 WLR 550

Re Smith; Ex Parte Rundle (1991) 5 WAR 295

Thorpe v Wanneroo City Council Appeal No CM-49/2000, Library No 108S (Magistrate Cockram); 1 December 2000

1 PARKER J: This is the return of an order nisi for a writ of certiorari. The order nisi was granted by Scott J on 30 August 2000. It was directed to Mr Monger, as Director of the Conciliation and Review Directorate ("the Director") appointed under the Workers' Compensation and Rehabilitation Act 1981 ("the Act").

2 The issue of a writ of certiorari was sought to remove into this Court, for the purposes of being quashed, the decisions of the Director:

"a) Made on or about 4 May 2000, to accept the referral of Craig William Spencer ('Spencer') pursuant to s93D(5) of the Workers' Compensation & Rehabilitation Act 1981 ('the Act') regarding whether his alleged degree of disability was not less than the relevant level, with one of the employers being identified as Cargo Enterprises Pty Ltd trading as WA Transport Spares & Repairs ('WA Transport Spares & Repairs'), (the other employer being Howard Porter (1936) Pty Ltd), the Director having erred in accepting the referral:

i) subsequent to the last day on which Spencer could refer the dispute to the Director. The Director ought to have rejected the referral on the ground that, for the purposes of s93E(6) of the Act, it could not be made less than 21 days prior to the termination day.

ii) when it was evident that Spencer was attempting to aggregate several disabilities for the purpose of the assessment process identified in s93D(2) of the Act. The Director ought to have rejected the referral on the ground that a separate referral for the purpose of s93D(5), and a separate assessment for the purpose of s93D(2) of the Act, is required for each and every disability.

iii) when it was not evident that the medical report filed in accordance with s93D(6) complied with the assessment process identified in s93D(2) of the Act. The Director ought to have rejected the referral on the ground that it was not evident that the assessment, made by Dr David Wright in his report of 20 March 2000, was made having regard to either the Second Schedule of the Act, or the AMA Guides.

b) Made on or about 9 June 2000, pursuant to s93D(10) of the Act, to refer Spencer's referral for resolution under the provisions of Part IIIA of the Act,

the Director having erred in that:

i) the Director made the referral when he ought to have found, on the grounds referred to in paragraph (a) above, that Spencer's referral under s93D(5) was invalid, and as a consequence, a referral under s93D(10) was not open to him;

ii) in any event, the referral, insofar as it relates to the disability allegedly sustained on 5 February 1996, could not be made with the responding employer being nominated as WA Transport Spares & Repairs. The Director ought to have found that a referral against WA Transport Spares & Repairs could only be made with respect to the disability sustained on 10 August 1998."

3 The applicant was the employer of Craig William Spencer when, on 10 August 1998, Mr Spencer claims he suffered injury to his lower back at work. On 24 November 1998, Mr Spencer claimed worker's compensation benefits. Weekly payments of compensation were commenced on 12 January 1999 in accordance with the provisions of the Act and Mr Spencer continues to receive those benefits.

4 On 3 May 2000, Mr Spencer purported to refer to the Director under s 93D(5) of the Act, using form 22, the question whether the degree of disability which he suffered was not less than 16 per cent, ie a "significant disability within the meaning of s 93E(3)(b) and s 93E(4). In the form 22 the injury is described as Lower Back Strain. With the form 22 there was a report of an orthopaedic surgeon who assessed Mr Spencer's disability as being "20% permanent disability of the lumbar spine". The applicant, having received notice of this from the Director by a form 23 dated 5 May 2000, notified the Director that it considered the degree of disability was less than 16 per cent so that a dispute arose for the purposes of Pt IIIA of the Act, as provided by s 93D(8). The Director then apparently referred the dispute for resolution pursuant to s 93D(10) as the applicant received notice dated 9 June 2000 of a listing of the question of Mr Spencer's degree of disability before a review officer for preliminary review on 26 June 2000. On that date, the review officer set down the matter for review on 19 September 2000. That review has not proceeded and remains pending because of the order nisi granted in August.

5 The first substantive issue raised by the applicant is whether it was open to the Director to receive the reference of the question, of whether the degree of disability of Mr Spencer was not less than 16 per cent, when Mr Spencer purported to refer that question by lodging the form 22 with the supporting medical report on 3 May 2000. The applicant also raises the further question whether it was open to the Director to act on that reference as he did by referring the dispute for resolution under s 93D(10).

6 These issues arise in the context of the provisions introduced into the Act by the Workers' Compensation and Rehabilitation Amendment Act 1999 which introduced further restrictions on the ability of an injured worker to obtain damages at common law from the employer. Subsections 93E(3) and (4) now provide:

(a) it is agreed or determined that the degree of disability is not less than 30% and that agreement or determination is recorded in accordance with the regulations; or

(b) the worker has a significant disability and elects, in the prescribed manner, to retain the right to seek damages and the election is registered in accordance with the regulations.

(4) For the purposes of subsection (3)(b) the worker has a significant disability if it is agreed or determined that the degree of disability is not less than 16% and that agreement or determination is recorded in accordance with the regulations."

7 Section 93E(3)(b) is, from its terms, directed primarily to a court of competent jurisdiction and precludes an award of damages in respect of a disability where a worker has a "significant disability", unless there has been an election in the prescribed manner, which election is registered in accordance with the regulations. Section 93E(5) precludes an election being made under s 93(3)(b) "after the termination day" if weekly payments of compensation in respect of the disability have been commenced. The "termination day" means the day 6 months after the day weekly payments commence (s 93E(1)). It is necessary therefore, for the election to be made before the termination day, although, by s 93E(6) and (7), in carefully specified circumstances a later election is possible. It is significant that once an election has been registered, the worker's entitlement to compensation for the disability or any recurrence, aggravation or acceleration of it ceases by operation of s 93E(8).

8 Thus, it can be seen that the legislative scheme significantly limits the ability of some workers to claim damages at common law in respect of disabilities suffered as a consequence of injuries at work. No damages may be recovered where the degree of disability is less than 16 per cent. Where the degree of disability is not less than 16 per cent, but less than 30 per cent, the worker may only recover damages at common law where the worker has elected in the prescribed manner to retain the right to seek damages and the election is registered in accordance with the regulations, even so an agreement or determination that the degree of disability is within that range must have been recorded in accordance with the regulations, s 93E(4). Where it is agreed between the worker and the employer or it is determined under the Act that the degree of disability is not less than 30 per cent, the worker may seek and recover damages so long as the agreement or determination is recorded in accordance with the regulations; there is no requirement in such a case for the worker to elect and have that election registered. Thus, there is a significant distinction in the statutory scheme between workers with a degree of disability not less than 30 per cent and those with a "significant disability".

9 An election to retain the right to seek damages pursuant to s 93E(3)(b) by a worker with a "significant disability" is to be made within a strict time limit. The election must be registered prior to the termination day, although, by virtue of transitional provisions, the termination day in the case of Mr Spencer was 5 January 2000. The time for election may be extended pursuant to s 93E(6) where a dispute as to the degree of disability arising under s 93D(8) has not been resolved before the termination day. However, for that to occur the worker must have produced to the Director, not less than 21 days before the termination day, medical evidence indicating that in a medical practitioner's opinion the degree of disability is not less than the "relevant level" (which is defined in s 93D(1) and in this case is not less than 16 per cent). In such a case, an election can be made within seven days after the dispute is resolved. Mr Spencer did not produce medical evidence to the Director not less than 21 days before the termination day so as to invoke s 93E(6). Section 93E(7) also provides for an extension of the election day by the Director in circumstances set out in regulations, but it is not contended that this provision has any operation in this case.

10 Mr Spencer, in fact, attempted to make an election on 5 January 2000 when his solicitors lodged a form 25. There had not been any agreement or determination of the degree of his disability at that date. The Director was not prepared to accept and register this as a valid election. The Director relied on reg 19M of the Workers' Compensation Regulations which had come into force on 14 December 1999 and which provided, inter alia, that an election under s 93E(3)(b) "cannot be made unless" the degree of disability is agreed or determined at not less than 16 per cent; ie, it is the effect of the regulation that the degree of disability must first be agreed or determined pursuant to the Act before an election is made and registered. The validity and effect of reg 19M was considered by McKechnie J in Re Monger; Ex parte Woodford [1999] WASC 273 who concluded at [34] - [35] that -

"34 ... In my view the overall structure of s 93E makes manifest Parliament's intention that the degree of disability should be resolved prior to the election by a worker under s 93E(3)(b).

35 This construction fits with s 93E(6) and s 93E(7), which contemplate the possibility that election cannot be made prior to termination day because of a current dispute. In such a case there must at least be some evidence of significant disability produced to the director. These sections would appear to be unnecessary if the applicant's contention is correct. The power to grant an extension is temporally limited to six months beyond termination day, indicating Parliament's intention that the whole issue of disability and election be resolved sooner rather than later."

His Honour also concluded that reg 19M was valid; see [48]. Also note [47]. The parties do not dispute the correctness of this decision although with respect to [35] I would note that s 93E(7) is not necessarily limited to the case of a current dispute and the time limit of six months applies only to s 93E(7) whereas under s 93E(6) on election must be made within seven days after the dispute is resolved.

11 On this basis, it is the case, therefore, that it is not possible now for Mr Spencer to register an election to retain the right to seek damages at common law for the "significant disability" which he claims. Section 19E(3)(b) precludes an award of damages as there has not been an election registered in accordance with the regulations and the time within which the election must be registered has passed. Had Mr Spencer produced to the Director medical evidence complying with s 93D(6) not less than 21 days before 5 January 2000, he could have invoked the extended period of time contemplated by s 93E(6), but he did not do this. Any attempt by Mr Spencer to recover damages at common law for his claimed significant disability must therefore fail under the present state of the law. The effect of the legislative scheme appears to be, therefore, that he is now confined to the compensation benefits provided under the Act in respect of his disability unless, at some later time, he can demonstrate that he has in fact a degree of disability which is not less than 30 per cent and achieve an agreement or determination of that which is recorded in accordance with the regulations; see s 93E(3)(a).

12 Nevertheless, by the form 22 lodged on 3 May 2000, Mr Spencer sought to refer the question of the degree of his disability to the Director pursuant to s 93D(5). His reason for doing so under the present statutory scheme is not apparent. Counsel suggested that, at least in theory, it could be that the review might lead to a determination that the degree of disability is not less than 30 per cent, in which event s 93E(3)(a) would apply, not s 93E(3)(b). But that is not what Mr Spencer has claimed in the form 22 as he has ticked the "not less than 16 per cent" square, leaving blank the "not less than 30 per cent" square, and the only medical evidence offered is of a 20 per cent permanent disability of the lumbar spine. It is not suggested any other medical evidence is available. There is no reason to think there is any prospect of a determination that Mr Spencer has a not less than 30 per cent disability arising from the injury in his employment with the applicant in 1998. As the times limited for Mr Spencer to elect and register the election to retain the right to seek damages under s 93E(3)(b) have no application to a disability of not less than 30 per cent, if Mr Spencer were ever in a position to demonstrate a disability of not less than 30 per cent it would be open to him to take the steps to achieve an agreement or determination of the degree of his disability, have that recorded in accordance with the regulations, and pursue a claim for damages at common law (subject, of course, to the Limitation Act).

13 The applicant objects that it cannot be the intended operation of the Act that Mr Spencer may now refer the question whether the degree of his disability is not less than 16 per cent to the Director pursuant to s 93D(5) when there is no longer any statutory purpose to be served by an agreement or determination that he has a "significant disability". In the circumstances, it is submitted for the applicant, the purported reference of the question of whether his degree of disability is not less than 16 per cent is an exercise in futility and makes nonsense of the statutory scheme for the determination of disputes as to a claimed "significant disability".

14 Mr Spencer argues that, as a matter of strict construction, the only times limited by the Act and regulations relate to an election and its registration, ie, to the scheme of s 93E, and not to the determination or resolution of a dispute as to the degree of disability under s 93D. It is submitted that the only relevant statutory functions or powers being exercised by the Director are those contemplated by s 93D, in particular s 93D(5) and (6). These provisions, it is submitted, are to be read independently of s 93E. They contain no stipulation or precondition as to time. The only preconditions are those provided by s 93D(5) and (6), to which the termination day has no relevance.

"5) If the worker and the employer cannot agree on whether the degree of disability is not less than the relevant level, the worker may, subject to subsection (6), refer the question to the Director.

(6) A question can only be referred under subsection (5) if the worker produces to the Director medical evidence from a medical practitioner indicating that, in the medical practitioner's opinion, the degree of disability is not less than the relevant level.

(7) As soon as practicable after receiving a referral under subsection (5) the Director is to notify the employer in accordance with the regulations.

(8) If within 21 days after being notified under subsection (7) the employer notifies the Director in accordance with the regulations that the employer considers that the degree of disability is less than the relevant level, a dispute arises for the purposes of Part IIIA.

(9) The Director is to consider the dispute in consultation with the parties.

(10) Except in a case to which subsection (11) applies, if the dispute is not resolved by agreement the Director is to refer the question for resolution under the provisions of Part IIIA (other than Division 2)."

• The worker and employer cannot agree where the degree of disability is not less than 16 per cent,

• the worker has produced medical evidence which complies with s 93D(6),

• therefore, the worker could refer the question to the Director under s 93D(5),

• the procedures of s 93D(7), (8) and (9) have been satisfied,

• therefore, by s 93D(10), as the dispute has not been resolved by agreement, the Director was required to refer the question for resolution, which he has done.

17 While the legislation provides no express statement of its intended operation in these circumstances, I am not persuaded that the legislature intended that s 93E and s 93D should be read and interpreted in isolation from each other. Rather, it appears to be the preferable view that the legislature intended that, together, they should form part of a coherent legislative scheme. The intended operation of its precise provisions is to be understood from their language, read in light, inter alia, of their general purpose as part of the scheme, and also in light of the law as to the availability of common law damages for personal injuries. It can hardly have been intended, for example, that a worker who claimed a not less than 30 per cent disability might invoke s 93D(5) to resolve a dispute about the level of the disability if that worker was already statute-barred by the Limitation Act from pursuing a claim for damages at common law. The legislative scheme, of which the dispute resolution procedures of s 93D are a part, is to limit the access of workers to common law remedies in certain circumstances. If those remedies are no longer available to the worker, the scheme has no purpose and, in my view of the intended effect of the legislative provisions, they would have no operation.

18 In the present case, where a "significant disability" is claimed, as the applicant may only be awarded damages if an election is made and registered in accordance with the regulations, and that has not occurred and can no longer occur, no purpose of the statutory scheme is served by construing s 93D(5) so as to enable its provisions still to be invoked. To do so would be a futile and entirely wasteful exercise, even if the worker could demonstrate a degree of disability of not less than 16 per cent. In my view, that was not the intention of the legislature. The submissions of Mr Spencer approach the construction of the statutory provisions in too narrow and constrained a way and lose sight of their purpose.

19 For these reasons, in my view, ground (a)(i) of the order nisi has been made out.

20 In view of the conclusion reached as to ground (a)(i) of the order nisi, it is unnecessary to reach conclusions as to grounds (a)(ii) and (iii). I would note, however, that ground (a)(ii) arises in the factual setting that Mr Spencer had in fact twice injured his back. The first was in 1996 when he was employed by a different employer. On that occasion, he claimed and received some benefits under the Act. The injury on 10 August 1998 while employed with the applicant was the second injury to his back. The application of Mr Spencer on form 22 dated 3 May 2000 gave as the employer's details, both the 1996 employer and the applicant, and gave the dates of both injuries; ie, 5 February 1996 and 10 August 1998. Only one injury was identified, however, and only one degree of disability was identified; ie, 20 per cent as assessed by the medical practitioner and not less than 16 per cent by the ticked square on the form. The Director, however, only gave notice of the application to the applicant, not to the earlier employer. The record of the proceedings on the preliminary review on 26 June 2000 identified only the applicant as the employer, although the review was noted as being "upon the form 22 filed 4 May 2000" which identified both employers.

21 Hence, it is in this factual setting that the applicant objected that Mr Spencer was attempting to aggregate more than one disability and that the reference should have been rejected by the Director on the basis that the statutory scheme required a separate referral pursuant to s 93D(5), and a separate assessment of the degree of disability for the purpose of s 93D(2), for the 1996 injury and the 1998 injury. This raises a number of issues of some complexity and, in view of the conclusion I have reached as to ground (a)(i), in my view it is preferable that their resolution should be left to a case, should one arise in the future, in which it is necessary to deal with these issues.

22 Ground (a)(iii) was not pursued in oral submissions, although the applicant stopped short of formally abandoning it. The decision of Miller J in Re Monger; Ex parte Ivey [1999] WASC 250, particularly at [21] - [23], contains reasoning which suggests the applicant would have little prospect of success on this ground, but, as already indicated, there is no need to reach any conclusion with respect to its merit.

23 Ground (b)(i) is, in part, consequential on the conclusion I have reached as to ground (a)(i). It is contended by the applicant that the referral of the dispute as to Mr Spencer's degree of disability to a review officer for determination pursuant to s 93D(10) was in excess of the Director's statutory powers, as the purported referral of the question by Mr Spencer to the Director pursuant to s 93D(5) was not authorised by that provision with the consequence, it is submitted, that there was no "dispute" within the meaning of s 93D(10) for the Director to refer for resolution.

24 Insofar as it was not open to Mr Spencer to refer to the Director the degree of his claimed disability under s 93D(5), in my view, ground (b)(i) is also sustained. There is no need to reach concluded views about the balance of the matters raised by ground (b)(i) or ground (b)(ii).

25 This is a case where the worker, Mr Spencer, sought to elect to retain a right to seek damages at common law under s 93E(3)(b) because he was not in a position to demonstrate that his degree of disability was not less than 30 per cent, ie he could not then bring himself within s 93E(3)(a) of the Act. It was necessary, therefore, for Mr Spencer to demonstrate (so as to secure the agreement of the employer or a determination) that he had a "significant disability", ie, a permanent disability of not less than 16 per cent and, further, he must have elected in the prescribed manner to retain that right and that election must have been registered in accordance with the regulations.

26 In my view, in a case where a worker with a significant disability seeks to retain the right to seek damages, it is the scheme of the Act that the worker may only refer the question to the Director pursuant to s 93D(5) and so, in the absence of agreement, utilise the dispute resolution procedure provided by s 93D(10), where the election can be registered prior to the termination date or within an extended election period as provided by s 93E(6) or s 93E(7).

27 In the present case, the termination date was 5 January 2000 and s 93E(6) and (7) did not apply, so that the Director acted beyond his powers in accepting a purported reference by Mr Spencer of the question of his degree of disability made on 3 May 2000 and in later referring the dispute under s 93D(10) for resolution under Pt IIIA. The Director ought to have refused to have received the reference of the question by Mr Spencer, as no election could then be made by Mr Spencer and no election could be registered in accordance with the regulations before the termination date. For the same reason, the provisions of s 93D(10) had no application to the case so as to authorise the Director to refer for resolution the dispute whether Mr Spencer's degree of disability was not less than 16 per cent.

28 For these reasons, the order nisi will be made absolute.