Crljenec v TAC [2003] VCAT 389

2. The application was set down for hearing to determine a preliminary issue of whether the Tribunal has jurisdiction to hear it.

3. The applicant was involved in a transport accident on 18 April 1999 and TAC accepted liability for medical and like expenses on 7 May 1999.

4. By letter dated 25 May 1999, TAC wrote to the applicant's solicitors relevantly as follows :

"TAC is pleased to advise that your claim for loss of earnings benefits has been accepted. ...

If you are unhappy with this decision, you can have your claim reviewed by TAC's Review Officer or the Victorian Civil and Administrative Tribunal".

The letter set out details of the applicant's weekly entitlement and the basis of that entitlement.

5. The "period of entitlement" referred to in s.44 of the Transport Accident Act 1986 ("the Act") expired on 17 October 2000.

6. By letter dated 6 November 2000, TAC wrote to the applicant pertinently as follows :

"The TAC has reviewed your claim for compensation following receipt of previous examinations.

I am writing to advise that further to your previous examinations with several medical examiners, TAC plans to discontinue your benefits on 3rd of December 2000. Based on these reports, the TAC believes that you are fit to return to your pre-accident employment.

[TAC set out a summary of various medical reports dealing with the applicant's capacity to work].

The TAC is only able to pay loss of income benefits to those clients who are unable to work due to the injuries they sustained as a result of their transport accident. The medical information we have does not support payment of continuation of benefits. The TAC is, therefore, unable to continue to pay you ongoing loss of income benefits.

As a result, the TAC will discontinue your loss of income benefits on the 3rd of December, 2000.

If you are still dissatisfied with this decision or believe that relevant information has been overlooked, you can have your claim reviewed by the TAC's Review Manager or the Victorian Civil and Administrative Tribunal. Information about both of these options, including the relevant time limit, is enclosed".

7. By letter dated 29 November 2000 to TAC, the applicant's former solicitors advised they acted for the applicant and requested various information including any documents lodged by the applicant in respect of a claim under s.44 of the Act and "copies of any decision letters effecting (sic) my client's rights under section 44, 45, 47, 48, 49, 50, 51 and 60 of the Act".

8. By letter also dated 29 November 2000, the applicant's former solicitors wrote to TAC pertinently as follows :

"I advise that I act for Ms Crljenec who was injured in a transport accident that occurred on 18 April 1999. I note that the Commission has made a decision to cease loss of earnings benefits as at 3 December 2000.

I would be grateful for copies of the reports, upon which the Commission based its decision".

9. By letter dated 8 February 2001 to the applicant's former solicitors, TAC stated in part as follows:

"I am writing in response to your request for copies of reports upon which the TAC based its decision to cease loss of earnings benefits for the above claimant".

TAC then referred to a number of medical reports which it had enclosed with the letter.

10. By letter dated 30 July 2001 to TAC, the applicant's former solicitors requested various information and material including "details of the claimant's entitlement to LOE and/or LOEC benefits to date" and "documentation and information provided in respect of a claim for loss of earnings (LOE) and/or loss of earning capacity (LOEC) benefits to date".

11. TAC's response to that letter appears to be contained in a letter from TAC to the applicant's former solicitors of 20 August 2001. A number of documents were enclosed with the letter including copies of a printout of payments by TAC to the applicant, including loss of earning benefit payments. It is not apparent from the material provided in TAC's Tribunal Book that it dealt specifically with the applicant's former solicitors' request for details of loss of earning capacity benefits.

12. Thereafter correspondence continued between the parties. By application for review dated 8 November 2001, the applicant sought a review of TAC's decision of 6 November 2000 "to cease loss of earnings benefits on the 3 December 2000". The application (G50748/2001) was filed several days after the expiry of the period of 12 months specified in s.77 of the Act for the filing of an application for review.

13. In its statement dated 5 December 2001 filed pursuant to s.49 of the Victorian Civil and Administrative Tribunal Act 1998 ("VCAT Act"), TAC stated that the "Decision under Review" was "TAC's decision dated 6 November 2001 to cease loss of earning benefits on 3 December 2000". It is not in issue that the reference to 6 November 2001 should be a reference to 6 November 2000.

14. By letter dated 11 December 2001, the applicant's former solicitors wrote to TAC Law Pty Ltd ("TAC Law") in part as follows ::

"I confirm that my client continued to receive loss of income benefits under Section 44 of the Act beyond the 18 months anniversary by virtue of Section 46(2) of the Act.

By letter dated 6 November 2000, your client advised Mrs Crljenec that her loss of earnings entitlements were to end on 3 December 2000.

No where in the letter is there any reference whatsoever to a decision under Sections 49, 50 or 51 of the Act in respect of loss of earning capacity.

It is clear that the Commission simply advised my client of a decision to terminate her entitlements under Section 44 of the Act.

Hence, even though the Commission might have intended to do otherwise, the simple fact remains that Mrs Crljenec has not been advised of any decision impacting upon her right to receive loss of earning capacity benefits under the Act.

In the circumstances, I ask that your client give immediate consideration to my client's loss of earning capacity benefit entitlements under Section 49 of the Act.

If you require any additional information to enable your client to reach a decision, please let me know. Otherwise, I would be pleased to receive notice of the decision in writing as quickly as possible".

15. By letter dated 17 December 2001, TAC Law advised the applicant's former solicitors as follows:

"We refer to your letter dated 11 December 2001. Our client's letter of 6 November 2000 was in respect of your client's entitlement to loss of income benefits which includes loss of earning capacity benefits.

We suggest that the Directions Hearing for 18 December 2001 be in respect of the jurisdictional point, that is the Application for Review is out of time. We are instructed to simply request a date and time when the preliminary issue can be decided".

16. On 18 December 2001, the application for review in proceedings numbered G50748/2001 was dismissed by the Tribunal with the consent of the parties.

17. As earlier indicated, the application for review which was the subject of these proceedings was filed on 27 November 2002 and sought to review the purported decision of TAC of 17 December 2001.

18. In a statement filed pursuant to s.49 of the VCAT Act and dated 20 December 2002, TAC stated that the decision under review was its decision "dated 6 November 2000 to cease loss of earning capacity benefits on 3 December 2000".

19. Section 77(1) of the Act states:

"A person whose interests are affected by a decision of the Commission may, within 12 months after becoming aware of the decision, apply to the Tribunal for review of the decision".

The Tribunal has no power to extend time for the filing of an application for review.

20. "Decision" is defined by s.3 of the Act to include "declaration, determination, direction or order". Section 4 of the VCAT Act sets out circumstances which constitute the making of a decision. Relevantly, the section provides :

(1) For the purposes of the Act or an enabling enactment, a person makes a decision if the person -

(a) makes, suspends, revokes or refuses to make a decision, order, determination or assessment (including a decision not to make a decision, order, determination or assessment);

(h) does or refuses to do any other act or thing".

21. Section 44 deals with entitlement to "total loss of earnings" benefits. Section 44(4) defines "period of entitlement" in respect of which TAC is liable to pay total loss of earnings as including any period after the first 18 months after the accident. Section 45 deals with partial loss of earnings benefits.

22. Section 46 states :

"(1) If it appears to the Commission that a person injured as a result of a transport accident will suffer a loss of earning capacity as a result of the injury 18 months after the accident, the Commission must, at or about that time, review the entitlement of the person to payments in respect of loss of earning capacity.

(2) If a review under sub-section (1) of the entitlement of a person injured as a result of a transport accident for compensation has not been completed within 18 months after the accident, the person continues to be entitled to compensation under section 44 or 45, as the case may be, as if the reference in those sections to 18 months were a reference to the date of completion of the review".

Section 49 sets out TAC's liability where an earner has suffered a "total loss of earning capacity". Section 49(1) states :

"(1) The Commission is liable to pay to an earner who, as a result of a transport accident -

a weekly payment in respect of that loss after the first 18 months after the accident or after the earner ceases to be entitled to payments under section 44 or 45, whichever last occurs, while that loss continues".

Section 50 deals with partial loss of earning capacity.

23. Section 6(1) defines "loss of earnings". Section 7 defines "loss of earning capacity".

24. It was submitted by Ms Magee, counsel for TAC, that the Tribunal had no jurisdiction to hear the application for review. She argued that TAC's letter of 6 November 2000 was in respect of the applicant's entitlement to loss of earnings and loss of earning capacity. That decision was the subject of the application for review in proceedings numbered G50748/2001 which was dismissed with the consent of the parties on 18 December 2001. Ms Magee argued that TAC's position that its decision of 6 November 2000 included loss of earning capacity benefits was clear to the applicant's former solicitors at the time they consented to the application for review being dismissed.

25. Ms Magee submitted further that the present application for review was misconceived and an abuse of process. TAC Law's letter of 17 December 2001 did not constitute a reviewable decision as TAC Law is not a decision-maker as defined in s.3 of the Victorian Civil and Administrative Tribunal Act 1998 (the VCAT Act). She contended that TAC Law's letter of 17 December 2001 merely reiterated TAC's determination of 6 November 2000 and was not a new and distinct determination capable of review. In this regard, she relied on Lindrea v TAC [2001] VSC 463.

26. It was submitted by Mr Keogh, counsel for the applicant, that the issue of loss of earning capacity had not been dealt with by the Tribunal in proceedings numbered G50748/2001 because it was not an issue that had been determined by TAC. The issue clearly arising from the decision of 6 November 2000 related to loss of earnings under s.44. The applicant did not seek to review TAC's decision relating to loss of earnings or to reinstate the application for review in relation to that decision.

27. Mr Keogh submitted further that the 6 November 2000 decision referred to loss of earnings by virtue of s.46(2) of the Act. This was because a person is entitled to compensation for total or partial loss of earnings until such time as TAC reviews the person's entitlement to payments in respect of loss of earning capacity.

28. Mr Keogh submitted that the term "loss of earnings" used in the correspondence between TAC and the applicant's former solicitors reflected the fact that the parties understood they were dealing with loss of earnings. Only TAC's letter of 6 November 2000 referred to "income". Further, at no time was "capacity" mentioned in the correspondence. The first time the word was used was in TAC's letter of 17 December 2001. TAC had the opportunity to clarify the situation in responding to the applicant's former solicitor's correspondence regarding loss of earning capacity but it had not done so.

29. Mr Keogh submitted further that TAC Law's letter of 17 December 2001 constituted a decision that was reviewable by the Tribunal. If it was not a decision, it was a very clear expression of intention to refuse to make a determination because of TAC's view that a determination had already been made.

30. Mr Keogh argued that it had been clear that there had been a dispute between the parties in relation to loss of earning capacity since December 2001 and TAC could have accepted that there was an ambiguity in its letter of 6 November 2000.

31. He argued that if he was wrong, and the December 2001 letter did not constitute a decision reviewable by the Tribunal, then it would be open to the Tribunal to make a finding of fact in relation to the meaning of the decision of 6 November 2000. He submitted that if the Tribunal simply found that it had no jurisdiction to entertain the present application, two consequences would flow. The applicant would be in a position where she could do nothing to obtain loss of earning capacity benefits as TAC stated a decision has already been made. Alternatively, if TAC was arguing that the applicant had not asked for loss of earning capacity benefits, further costs would be wasted while the request was made for those benefits, there was a refusal and then a further application for review.

32. The first question that arises is whether the decision of TAC of 6 November 2000 concerned not only loss of earnings but loss of earning capacity benefits. If it did, as Ms Magee contended, the Tribunal has no jurisdiction to hear the application for review.

33. The Act makes a distinction between loss of earnings and loss of earning capacity. This is apparent from sections 44 and 45 dealing with total loss of earnings and partial loss of earnings, and sections 49 and 50 dealing with total loss of earning capacity and partial loss of earning capacity. Section 6 dealing with loss of earnings and s.7 dealing with loss of earning capacity provides for further clarification of the difference between these benefits.

34. In my view, TAC's letter of 6 November 2000, in referring to "loss of income benefits" was ambiguous in its terms and could not be said to constitute a decision in relation to loss of earning capacity.

35. It may be that TAC had, as at 6 November 2000, reviewed the entitlement of the applicant to payments in respect of loss of earning capacity pursuant to s.46, as the determination was made only a short time after the 18th month period expired from the date of the accident. If this was what it had done however, it should have clearly stated its decision in its 6 November 2000 letter. As it was it merely referred to the applicant's "benefits" and "loss of income benefits". In this regard, I accept Mr Keogh's submission that a reasonable interpretation of TAC's letter was that it was denying the applicant's entitlement to loss of earnings for the purposes of s.46(2) of the Act, pending the completion of a review by TAC as to the applicant's entitlement to loss of earning capacity benefits.

36. My view that the 6 November 2000 letter did not constitute a decision in relation to loss of earning capacity is strengthened by the subsequent correspondence between the parties. My examination of the material filed by TAC indicates that nowhere in the correspondence was there mention by TAC of loss of earning capacity benefits. This was notwithstanding a request from the applicant's former solicitors for any "decision letter" affecting the applicant's rights under sections 49 and 50 in November 2000, and a letter in July 2001 requesting details of "LOEC benefits to date". It is also significant, in my view, that in its s. 49 statement filed in the earlier proceedings, TAC stated that the decision under review was its decision of 6 November 2000 to cease "loss of earning benefits" on 3 December 2000. It would seem that it was not until a couple of weeks later that TAC came to the view that its decision included loss of earning capacity benefits.

37. For these reasons, I do not consider that TAC's determination of 6 November 2000 is a decision relating to loss of earning capacity benefits.

38. The effect of my finding that TAC's decision of 6 November 2000 did not relate to loss of earning capacity benefits is that TAC has not made a decision in relation to loss of earning capacity benefits.

39. The question then arises as to whether the 17 December 2001 letter constitutes a reviewable decision. It is apparent from s.4(1) of the VCAT Act that a refusal to make a decision constitutes a decision. In my view, Mr Keogh is correct in his submission to the effect that the correct characterisation of the letter of 17 December 2001 is that it was a refusal to make a decision as to loss of earning capacity benefits, on the basis that a decision had already been made.

40. In my opinion, it is not to the point that TAC Law is not a decision-maker as defined in s.3 of the VCAT Act. The applicant, through her solicitors, requested determination of her loss of earning capacity. TAC, through its solicitors, refused to make the decision. In my view The decision of Lindrea v TAC is not directly on point in that it deals with a decision of TAC made on an internal review.

41. The application for review, seeks to review "TAC Law's letter /decision ceasing loss of earning capacity benefits". The decision date is specified as 17 December 2001. This is a misdescription of the decision, but the date quoted in the application is the date constituting the refusal to make a decision.

42. In such circumstances, the Tribunal has jurisdiction to entertain the application for review.

43. In view of my findings, the refusal by TAC to make a decision is set aside and the matter is remitted to TAC for consideration and determination of the applicant's entitlement to loss of earning capacity benefits. I reserve the question of costs.