What happened
Gordon Dey, a relieving assistant station master employed by the Victorian Railways Commissioners, was killed on 29 April 1947 when struck by trucks while driving a tractor at a level crossing at Williamstown Beach. The accident arose out of and in the course of his employment. On 9 May 1947 E. H. Ruddell, accountant of the Australian Railways Union, wrote to the employer applying for compensation on behalf of the dependants. The letter identified the widow, Ellen Malvina Dey (born 22 October 1907), and four sons: Ivor William (born 7 April 1932), Timothy Gordon (born 29 June 1935), Gordon Joseph (born 18 March 1939) and John Anthony (born 5 December 1941). On 19 May 1947 the employer gave the prescribed notice to the registrar of the Workers' Compensation Board stating that a claim had been made by or on behalf of the widow on her own behalf and on behalf of her named sons, all described as claimants. The employer admitted liability and the amount was to be ascertained by the Board.
Proceedings were placed in the summary list under s. 17(2) of the Workers' Compensation Act 1946. Notice of hearing was headed "In the matter of a claim by Ellen Malvina Dey against the Victorian Railways Commissioners". At the hearing on 26 May 1947 the widow was represented by Mr Ruddell and gave evidence that she was the widow, that the four named children were dependent, and confirming the particulars previously supplied. The Board made an award of £1,100 (the statutory sum of £1,000 plus £25 for each of four children under 16) to be paid into the custody of the Board. The award recited that the deceased left the widow and the four named children under 16 wholly dependent upon his earnings. On 28 May 1947 the employer paid the £1,100 into the custody of the Board and received the registrar's receipt, which by paragraph 5 of the First Schedule constitutes a sufficient discharge.
On the same day the widow's newly instructed solicitor wrote to the registrar stating that he had been instructed to launch a common-law action under the Wrongs Act 1928 on behalf of the widow and children. The letter asserted that Mr Ruddell had never explained to the widow that she was making an election between workers' compensation and a common-law claim and that she had been unaware of her common-law rights. The registrar replied that no further action would be taken pending further instructions, but noted that the money had already been paid in. On 30 September 1947 the widow issued a County Court summons claiming £9,006 4s. 6d. on behalf of herself and the four children, alleging 17 particulars of negligence. The defendant successfully applied to transfer the action to the Supreme Court under s. 61 of the County Court Act 1928 on the ground that a difficult question of law arose from the prior award.
Pleadings were delivered. The defence (without prejudice to an application to dismiss) relied on contributory negligence and, centrally, on the award. The defendant then took out a summons seeking dismissal of the action as frivolous, vexatious and an abuse of process under Order XIVA, Order XXV rule 4 or the inherent jurisdiction. Barry J. dismissed the action, holding that the facts were indisputable, that the award was a final determination by a statutory tribunal imposing liability under the Act, and that s. 5(2)(b) of the Workers' Compensation Act 1928 (as amended) therefore prevented any liability independently of the Act. He considered that a trial would be futile and wasteful.
The widow appealed to the High Court. The Court (Latham C.J., Rich, Dixon, McTiernan and Williams JJ.) allowed the appeal in part. The order discharged the Supreme Court order, declared that the plaintiff was not entitled to maintain the action in her own right but that the infant children were competent to sue by their next friend, gave liberty to the infants to apply for change of parties, stayed the action otherwise until further order, and made no order as to costs. The reasoning of the five judges, while not identical, converged on the propositions that the widow was bound by the award but the infants were not, because they had not been properly before the Board as parties represented by a next friend.
Why the court decided this way
The central statutory provision was s. 5(2)(b) of the Workers' Compensation Act 1928 (as amended in 1946). Latham C.J. set out its four limbs: (a) nothing in the Act affects any civil liability of the employer where the injury results from the employer's negligence; (b) the worker may at his option claim compensation under the Act or take proceedings independently; (c) but the employer shall not be liable to pay compensation both independently and under the Act; and (d) the employer is not liable to proceedings independently of the Act except in the cases of negligence. His Honour held that the provision is not happily worded but its object is to prevent the employer paying twice for the same injury. He rejected the argument that paragraph (c) operates only after an informed exercise of option under (b). Instead he read "but" as adversative, so that once liability under the Act has been created by award the employer cannot also be made liable independently of the Act in respect of the same person. Because s. 16 of the 1946 Act requires an award before any payment can count as compensation in a death case, the award of 26 May 1947 created the statutory liability. The widow had authorised the claim, attended, given evidence and been described throughout as the claimant. The award therefore bound her and, by force of s. 5(2)(b), barred her Wrongs Act claim. Latham C.J. expressly approved the view that the bar operates in respect of the same person; different dependants may choose differently.
All judges accepted that each dependant has a several right (citing the analysis in Kinneil Cannel and Coking Coal Co. Ltd. v. Waddell and Avery v. London and North Eastern Railway Co.). The critical distinction was between the widow and the infants. Latham C.J., Rich J. and Williams J. held that the infants had never been properly before the Board. Rule 8 of the 1946 Workers' Compensation Rules applied the County Court Rules as to persons under disability. Those rules require an infant plaintiff to sue by next friend who undertakes responsibility for costs and whose conduct is supervised by the court. No next friend had been appointed, no undertaking given, and the Board had not directed under the proviso to rule 8 that the infants could appear as if of full age. Rule 81 provides that non-compliance does not render proceedings void unless the Board so directs, but Latham C.J. held this could not bind persons who were not parties. An infant cannot authorise an agent to bind him; the proceedings were therefore irregular as to the infants and did not engage s. 5(2)(b) against them. Williams J. added that the next friend is an officer of the court charged with protecting the infant's interests; without that safeguard the infants could not be bound.
Dixon J. placed greater emphasis on the inappropriateness of summary dismissal. He accepted that the question under s. 5(2)(b) was difficult and that the authorities (especially Young v. Bristol Aeroplane Co. Ltd.) showed that knowledge of the alternative remedies is required before an informed election can occur. Because the widow's ignorance was not disputed, and because the infants had no legal responsibility for the compensation proceedings, neither was barred. Dixon J. considered that the inherent jurisdiction to prevent abuse of process should not be used to deprive a litigant of a genuine controversy capable of argument, even if the legal point is complex. The defendants had sought to short-circuit a full trial on a debatable construction of s. 5(2)(b). Nevertheless Dixon J. joined in the order that distinguished between the widow and the children.
McTiernan J. analysed the speeches in Young v. Bristol Aeroplane Co. Ltd. and concluded that the majority (Viscount Simon, Lord Russell and Lord Porter) treated the double-liability limb as exegetical of the option limb. An award obtained without knowledge of the alternative did not close the chapter. He held that the third limb protects the employer from paying twice but does not extinguish the option where it has not been exercised with knowledge. Because nothing had been paid out of the fund to the widow or children, there was no set-off issue. McTiernan J. would have allowed the appeal in full.
Williams J. (with whom Rich J. substantially agreed) held that the widow had effectively elected by obtaining the award, even without knowledge, because once liability crystallised under the Act s. 5(2)(b) prevented double liability in respect of the same person. However he reached the same conclusion as Latham C.J. on the infants: they had not been made applicants by a next friend and could not be bound. The amount of the award had been fixed by statute once the number of dependent children was ascertained; it did not confer separate rights on each child. The children therefore remained free to pursue the Wrongs Act claim.
The Court was unanimous that the Supreme Court order could not stand in its original form. A declaration and a stay limited to the widow, coupled with liberty to the infants to apply for proper joinder, gave effect to the distinction between those properly bound by the award and those who were not.
Before and after state of the law
Before Dey the law was beset by conflicting English, Scottish and Irish decisions on the meaning of provisions in substantially identical terms to s. 5(2)(b). Latham C.J. referred to the "great and increasing mass of judicial decisions" and noted that the section had not been a striking legislative success. Cases such as Neale v. Electric and Ordnance Accessories Co. Ltd., Cribb v. Kynoch Ltd. (No. 2) and Edwards v. Godfrey had held that obtaining an award or even an unsuccessful common-law action irrevocably exercised the option even without knowledge. Young v. Bristol Aeroplane Co. Ltd. displaced that view: the House of Lords held that the option requires knowledge of the alternatives. The Victorian legislation contained additional safeguards—s. 16 of the 1946 Act requiring an award before any payment counts as compensation, and s. 12 giving a second chance after an unsuccessful claim either under or independently of the Act—that removed some of the difficulties encountered elsewhere.
Dey clarified that once an award has been made on a claim authorised by a particular dependant, that dependant cannot thereafter pursue the independent remedy. The bar is personal. The judgment also made clear that the procedural protections for infants are not mere technicalities. The requirement of a next friend is substantive; without it the infant is not before the tribunal and the award does not bind him. The non-compliance rule (rule 81) prevents the proceedings being treated as void but does not expand the class of persons bound by them. Dixon J. reinforced that the inherent jurisdiction to dismiss as an abuse of process is not to be used to resolve genuinely debatable questions of statutory construction on a summary application, even though the Court ultimately decided the legal point in the widow's case.
After Dey the law stood that an informed election is required before the option is lost, but that an award obtained by a person with authority creates a statutory liability which, by the third limb of s. 5(2)(b), prevents that same person recovering again independently of the Act. The decision confirmed that dependants' rights are several, not joint, and that infants receive special procedural protection that cannot be waived by a parent or union official.
Key passages with plain-English translation
Latham C.J. said: "The provision as to the liability of the employer cannot, in my opinion, be regarded as expository or explanatory of the provision relating to the exercise of the option by the worker. Provision (c) is introduced by the word 'but'. ... The word 'but,' where it here appears in the section, produces in my opinion the following result ... 'but (whatever the worker does about his option—whether he exercises it or not—and however he exercises it) the employer shall not be liable to pay compensation both independently of and also under the Act.'" (Plain English: The "no double liability" sentence is not just explaining the worker's right to choose; it is a separate rule that once the employer is liable under the Act for a particular person it cannot be made liable again for that same person under the common law.)
On infants: "An infant cannot give authority to institute proceedings so as to bind himself, and that is one of the reasons why a next friend is required. Accordingly, in my opinion, the better view is that the rights of the infants were not affected by the result of the proceedings taken without observance of the legal requirement of a next friend." (Plain English: Children cannot legally instruct lawyers or union officials to make binding decisions on their behalf. Because no adult was formally appointed as their "next friend" to look after their interests in the compensation case, the children are not stuck with the outcome of that case.)
Dixon J. observed: "once it appears that there is a real question to be determined whether of fact or law and that the rights of the parties depend upon it, then it is not competent for the court to dismiss the action as frivolous and vexatious and an abuse of process." (Plain English: If there is a real legal argument worth hearing, the court should not use its summary powers to stop the case before a proper hearing, even if the argument is complicated.)
Williams J. stated: "the children could not authorize Ruddell to act on their behalf or appear for them" and "if the infants had duly applied for and obtained an award of compensation under the Workers' Compensation Act in the manner prescribed by the rules, they would have been barred like the widow from suing for damages under the Wrongs Act. But ... the children were not in my opinion properly before the Board as applicants and are not bound by the award." (Plain English: The union man could not speak for the children because only a court-appointed next friend can do that. Had the children been properly joined with a next friend they would have been bound; because they were not, they remain free to sue.)
What fact patterns trigger this precedent
The precedent is triggered whenever (1) a worker dies from a workplace injury caused by the employer's negligence, (2) a dependant (typically the widow) authorises and participates in a claim for the statutory lump-sum compensation under the Workers' Compensation Acts, (3) an award is made and the money paid into the Board, and (4) that same dependant later attempts to sue for damages under the Wrongs Act 1928 (or equivalent Lord Campbell's Act legislation). In that situation the dependant who obtained the award is barred by s. 5(2)(b). The precedent also applies where infant dependants are named in the compensation claim but no next friend has been appointed in accordance with the County Court Rules as applied by the Workers' Compensation Rules. In that case the infants are not barred and may sue by a next friend after proper joinder. The decision further applies to any summary dismissal application where the defendant relies on a prior award as a complete bar and the facts are undisputed; the court may dismiss or stay the action as to those bound by the award but must allow it to proceed as to those not bound. The factual trigger is not the mere making of a claim, but the making of an award that creates liability under the Act in respect of a particular person who had authority to bring the claim.
How later courts have treated it
The judgment itself carefully treated earlier authorities. It followed Young v. Bristol Aeroplane Co. Ltd. for the proposition that the statutory option requires knowledge of the alternatives and cannot be exercised irrevocably by the mere institution of proceedings or obtaining of an award without that knowledge. It applied Kinneil and Avery for the several nature of each dependant's rights and the proposition that one dependant's choice does not bind another. It distinguished Neale v. Electric and Ordnance Accessories Co. Ltd. and the older English cases that treated the obtaining of an award as conclusive election even without knowledge. Latham C.J. noted that those cases could no longer be regarded as authorities on the option limb after Young. The Court treated Brown v. William Hamilton & Co. and the speeches of Viscount Simon, Lord Russell and Lord Porter with respect, adopting the view that the double-liability limb is linked to the option but still operates to protect the employer once liability has crystallised by award in respect of a particular person. Dixon J. treated the inherent-jurisdiction authorities (Burton v. Shire of Bairnsdale, Hubbuck & Sons Ltd. v. Wilkinson, Heywood & Clark Ltd.) as confirming that summary dismissal is inappropriate where a real question of law exists. The judgment has therefore been used as an authoritative reconciliation of the pre-Young confusion and as a clear statement of the procedural safeguards required before an infant can be treated as having chosen one remedy over another.
Still-open questions
The judgments leave open whether an award obtained by a widow who later claims she lacked knowledge can be challenged on the ground that the option was never exercised, or whether the making of the award itself irrevocably fixes liability under the Act for that person. Latham C.J. and Williams J. appear to treat the award as creating liability regardless of knowledge, while Dixon J. and McTiernan J. place more weight on the requirement of informed choice. The precise interaction between s. 5(2)(b) and s. 16 of the 1946 Act in cases where money is paid without an award is not fully resolved, although all judges accepted that an award is now mandatory. The Court did not decide whether the Board itself could, on application by the infants, vary the award or distribution once a next friend is appointed. The limits of the non-compliance rule (rule 81) in cases where an infant is informally represented but the proceedings are clearly for the infant's benefit are left for future decision; the Court held only that the rule could not bind a non-party. Finally, the exact quantum of damages recoverable by the infants in the Wrongs Act action, and whether any distribution already made from the compensation fund must be brought into account, was not determined and is left to the Supreme Court on any future application for change of parties or assessment of damages. These questions illustrate that while Dey settled the position of the widow and the infants on the facts before it, the interplay between the compensation scheme, the election provision and the procedural rules for infants continues to require careful factual analysis in each case.