DEPARTMENT OF CORRECTIVE SERVICES v PATIKAS

Clarke JA. I will ask Mr Justice Cripps to give the first judgment.

Cripps JA. This is an appeal against a decision of Judge Johns in the Compensation Court on 3 September 1991 awarding compensation for the respondent relevantly for a period based on his total incapacity from 10 October 1989 to 20 (as it is now agreed it should be) January 1990.

The issue in this appeal, we were informed by Mr Oslington, on behalf of the appellant, is concerned solely with the construction and application of s 46 of the Workers Compensation Act 1987.

The question is whether the appellant was obliged to pay to the worker the maximum entitlement under the Act because of the respondent's agreed incapacity to work from 10 October 1989 to 20 January 1990.

The appellant contends that the trial judge ought to have had regard to the circumstance that during that period he was in receipt of entitlements under the State Superannuation Act and that, therefore, a proper application of s 46 of the relevant legislation required the Judge to make the appropriate allowance.

I am prepared to assume that the pension the respondent received from the Board arose out of his anxiety state, which was the same anxiety state that entitled him to the maximum award of compensation made by the learned trial judge.

Under s 33 of the Act, proof of incapacity means the respondent became entitled to compensation. The reduction in the amount of compensation is to be found, if it is to be found at all, in the provisions of s 46 of the Workers Compensation Act 1987. Section 46 provides:

The Compensation Court may, on the determination of an application for weekly payment of compensation or on a review under this Act of any weekly payment of compensation, order that the weekly payment be reduced to prevent dual benefits of the same kind being payable by the employer during and in respect of the incapacity for work.

It is submitted by Mr Oslington that on the facts found in this case, namely that the respondent had contributed to a superannuation fund established under the Superannuation Act and received payments between October 1989 and January

1990, the amount of compensation he was awarded should not have been the maximum but should have been reduced to reflect the 'dual benefits ofthe same kind being paid by the employer during and in respect of the incapacity for work'.

It would seem to me, with respect to Mr Oslington's careful argument, that a fundamental problem facing him is that he has not established any dual benefits of the same kind being paid by the employer during and in respect of the incapacity to work. Any such payments that were received by the worker in the nature of superannuation came from the Superannuation Board, not the employer.

The evidence establishes that the respondent contributed to the superannuation scheme in not quite equal proportion to the amount contributed by his employer. The actual contributions were, I think, $1.30 by the employer to $1 by the employee. The respondent had contributed since 1983 and his contributions totalled about $14,000 by 1990.

I think it is not necessary for this Court to determine what was said to be the matter of principle involved in these proceedings, namely, whether or not the words 'payable by the employer', where appearing in s 46, ought be construed to mean 'payment from a fund to which the employer has contributed', because even if it is to be given that extended meaning (and I am bound to say I have considerable doubt about the proposition) there was not any material before the Court which would have entitled the trial judge to have made the reduction - theonus, I would have thought, being on the employer to establish the amount of the reduction.

I have come to the conclusion that even if (which I doubt) the construction Mr Oslington advances has merit in the instant case, the facts do not support the conclusion which it is said the learned trial judge ought to have reached and, accordingly, I would dismiss the appeal with costs.

Clarke JA. I agree. Mr Oslington constructed an elaborate argument as to the construction of s 46 of the Workers Compensation Act, and the fact that the proviso was not repeated in s 46.

.. other than any payment, allowance or benefit from a superannuation or similar fund to which the worker has contributed.

Mr Oslington submitted that those words, introduced in 1951, demonstrated a legislative awareness of the possibility that payments may be made from a fund conducted by a third party, but to which the employer had made contributions. He then proceeded to develop his argument by submitting that the omission of those words from the Act in s 46, which replaced the old s 13, meant that regard should be had to funds of the type mentioned in the proviso, whether or not the worker had contributed, as the worker in this case had.

He sought to bolster the argument by reference to the decision of the House of Lords in Considine & Anorv McInerney (1916) 2 AC 162. In the 1926 Act, s 13 required the judge to have regard to:

. any payment, allowance or benefit which the worker may receive from the employer during the period of his incapacity.

The payment, allowance or benefit may, as it seems to me, have been made earlier than the period of incapacity, but provided the worker received them during that period regard was required to be taken of them.

URJ DEPARTMENT OF CORRECTIVE SERVICES v PATIKAS (Handley JA) 3

Section 46 is structured differently. It empowers the court to order that weekly payments be reduced to prevent:

... dual benefits of the same kind being payable by the employer during and in respect of the incapacity for work.

The argument put forward that contributions to a superannuation scheme should be taken into account fails to recognise the conditions upon which dual benefits are to be taken into account; that is that they were to be taken into account only if they were payable by the employer during and in respect of the incapacity for work. Whatever else may be said about contributions to superannuation schemes by the employer in this case, it cannot be said that benefits ultimately given to the employee resulted from sums payable by the employer during the same period (during the period of his incapacity). The payments that were made were, in fact, made well before the period of incapacity and cannot possibly qualify under s 46.

I think that there is no substance in the appellant's argument. In my opinion, the case falls to be determined on the proper construction of the words of s 46. I would add that in making the statements I have made, I have assumed in favour of the appellant that payments to a superannuation fund may be a relevant benefit. I make this assumption in accordance with the argument put to the court, but I should add I have considerable doubt as to its validity.

The other ground mentioned by his Honour Cripps is one with which I also agree, and that is that the evidence in this case falls far short of showing that any benefits, apart from workers compensation, were paid by the appellant to the respondent during and in respect of his incapacity.

Handley JA. I also agree. It seems to me, despite the careful argument that has been presented to the Court, that in this case the break down pension payable by the employer during the incapacity for work found by the trial judge. Those amounts were payable by the Board.

Counsel for the appellant: B Oslington QC/P Perry Solicitors for the appellant: Hunt and Hunt Counsel for the respondent: A F Puckeridge QC/T J Ryman