Hahn v Commissioner of Police

Third respondent's motion 9The basis of the third respondent's concern was expressed in its written submissions on the motion, that being that the first respondent had intimated bringing unspecified legal action against FTC in respect of the insurance contract between FTC and MetLife or arising from the circumstances of its inception. In the circumstances, FTC was concerned to ensure that it was not unintentionally prejudiced by findings as to the legal effect or circumstances of the insurance contract in the absence of a full opportunity for evidence and argument addressing those matters with precision. 10There were four paragraphs in Hahn (No 1) that the third respondent considered to be "contentious". They were as follows: [3] The first respondent, the Commissioner of Police, is the former employer of the applicants. Pursuant to cl 10.1 of the Award, NSW Police Force established the Scheme with the third respondent as trustee of the Scheme to pay the lump sum benefits prescribed by cll 7 and 8 of the Award. In about July 2005, under an insurance contract, the second respondent issued to the third respondent a policy of insurance to cover the liability of the third respondent under the Scheme. The policy was called the "Blue Ribbon Group Life Policy". (emphasis added) ... [36] The Blue Ribbon Policy was established to meet the insurance needs of FTC providing the total and permanent disability benefit provided for in the Award. (emphasis added) ... [50] As it may be seen, cl 10 of the Award contemplates the establishment by the NSW Police Force of an insurance scheme with FTC to be known as the First State Super Insurance Scheme. The Scheme was established in or about the time of commencement of the Award: Crown in right of the State of NSW v Maund / Maund v FSS Trustee Corporation [2013] NSWSC 183 at [6]-[7]. (emphasis added) ... [52] Under the terms of the Scheme, FTC was entitled to effect insurance coverage in respect of the benefits payable (see Rule 11.2 of the Scheme). At the time of commencement of the Award, FTC effected an insurance policy with Metlife for the purposes of covering the obligation to pay the disability benefits as set out in the Award. As it was noted in Maund at [5], the terms of the Award were within the contemplation of both FTC and Metlife at the time that Metlife issued the policy (that is, December 2005). (emphasis added) 11The third respondent submitted the effect of these paragraphs seemed to include findings that: (1) the insurance contract between FTC and MetLife was "an insurance scheme" contemplated by clause 10 of the Award. (2)the insurance contract between FTC and MetLife gave effect to the provision of the Award. (3)FTC was, in some way, empowered by the Award to act. (4)FTC's purpose in entering the insurance contract was for the purposes of covering "the obligation" to pay the disability benefits as set out in the Award. (5)the terms of the Award were within the contemplation of both FTC and MetLife at the time that MetLife issued the policy. (6)the factual finding of Lindsay J in Maund at paragraph [5] of that judgment was either non-controversial or was binding on FTC and MetLife. 12The third respondent submitted these matters were not:

• conceded by FTC. In its supplementary submissions on particular declarations and orders on MetLife's motion, FTC noted that allegations to the effect that it "is the owner of the policy of insurance established pursuant to clause 10.1 of the Award" (emphasis added) are contested facts in the proceedings. The Court may, perhaps, have overlooked these submissions.
• the subject of evidence on MetLife's motion....
• in issue on MetLife's motion as ultimately argued. No oral argument was addressed to it and no later written argument sought to contradict FTC's submission that the legal relationship, if any, between the Award and the insurance contract would be a contested fact in the proceedings.
• the subject of detailed argument with the level of precision necessary to determine them to finality with fairness to all the parties. 13Having reviewed the relevant material, and noting the relative indifference of the other parties regarding the issue, I accept the third respondent is correct in submitting the matters referred to in [3], [36], [50] and [52] were not the subject of full argument and evidence and were not necessary findings for disposing of the central issues in contention. If there is a risk the third respondent is prejudiced by what might be regarded as findings that were not the subject of full argument and evidence, the prospect of any prejudice needs to addressed. 14I also note the ambiguity referred to by the third respondent in the reasons for judgment arising from the fact that in [1] the First State Super Scheme is defined as "the Scheme" for the purposes of the judgment, but at [52] reference is made to rule 11.2 of the Superannuation Trust Rules as "the Scheme". The third respondent was concerned some prejudice or confusion might lie against it if this ambiguity was not recognised. 15I agree with the third respondent's submission that: The principal holding in the judgment [Hahn (No 1)] is that the applicants in the proceedings, on the facts alleged, did not have an entitlement to a benefit under the Award at the material time as a factual ingredient of such an entitlement arising (a state of satisfaction arising in MetLife in terms of the insurance contract) had not yet occurred (paragraphs [70] and [73] of the Court's reasons 10 April 2014). This holding does not depend on the finding of any factual or legal connection between the Award and the contract, other than a description of the factual ingredient stipulated by the Award. That the findings in paragraphs 50 and 52 are not necessary to the principal holding might be a reason not to recall them (because they are not or will not become binding in any event) (Generate Group Pty Ltd v Sea Tech Automation Pty Ltd [2007] NSWSC 255 at [20]). However, it would still be a proper exercise of the Court's power to do so, as this would avoid confusion and any unnecessary expense of future argument as to the intended significance and force of those paragraphs. Alternatively, the Court may exercise its power of clarification. 16That raises the Court's power to grant the third respondent's application. The Industrial Court is a superior court of record and, in my opinion, there is an implied power to amend reasons for decision where final orders have not been entered: see Brimaud v Honeysett Instant Print Pty Limited (1988) 217 ALR 44 per McLelland J at 46; Gate Gourmet Australia Pty Ltd v Gate Gourmet Holding AG [2004] NSWSC 761 per Einstein J at [5]-[15]; MK and JA Roche Pty Limited & Ors v Metro Edgley Pty Limited & Anor [2004] NSWSC 780 at [3]-[10]; Berkeley Challenge Pty Ltd v Howarth [2013] NSWCA 370 per Tobias JA at [107]. 17I propose to grant the third respondent's motion.

Applicant's motion to transfer 18As I understand the applicant's position, he now wishes to have the proceedings transferred to the Supreme Court pursuant to s 151 of the Civil Procedure Act 2005, first because there is a contractual issue concerning Mr Hahn to be determined regarding MetLife's refusal to pay him benefits notwithstanding that the Claims Review Committee established under the "FSS Trustee Corporation Group Life Insurance Policy - Basic Policy" had determined benefits were payable. Secondly, Mr Hahn now seeks damages against the second respondent. These matters are adverted to in the affidavit of Mr Hahn's solicitor in support of his motion to transfer: ... 2. The substantive question with respect to the Applicant's proceedings is an interpretation of two clauses in a group life insurance policy 3. As I understand the insurer's position it has suggested in these and/or other proceedings that such a question is best dealt with in the Supreme Court 4. My instructions are that the Applicant whilst not conceding any question of jurisdiction accepts that his matter should be transferred to be dealt with by the Supreme Court 5. I have received instructions from the Plaintiff to pursue a claim against the Second Respondent for damages in addition to the declarations sought in the substantive proceedings. 6. To the best of my knowledge and understanding the Industrial Court is unable to make an award for damages in matter number 675 of 2013. 19Each of the applicants for declaratory relief, however, continues to oppose the second respondent's motion to dismiss their applications. 20The second respondent submitted that the power sought to be invoked by Mr Hahn under s 151 of the Civil Procedure Act was not available and whilst the Supreme Court was the appropriate forum, the proper course was for the proceedings in the Industrial Court to be dismissed and for Mr Hahn to commence proceedings in the Supreme Court. 21Section 151(1) of the Civil Procedure Act provides: If either the Supreme Court or the Industrial Court is satisfied, in relation to proceedings before it, that it is more appropriate for the proceedings to be heard in the other court, it may, on application by a party to the proceedings or of its own motion, order that the proceedings be transferred to the other court. 22Senior counsel for the second respondent submitted the language of s 151(1) more appropriately conveyed that the proceedings must have been properly and relevantly before the Industrial Court. That is, the Industrial Court validly had jurisdiction in the matter, but for reasons of convenience it was more appropriate that the matter be in the Supreme Court rather than the Industrial Court. In other words, the provision is triggered only in proceedings where, relevantly, the Industrial Court has jurisdiction to decide the dispute, but as a matter of discretion considers it more appropriate for the proceedings to be in the Supreme Court. 23It was submitted s 154 of the Civil Procedure Act reinforced the correctness of the second respondent's submission. Section 154 provides: 154 Jurisdiction of transferee court The transferee court has, and may exercise, all of the jurisdiction of the transferor court in relation to any proceedings to which a transfer order relates, including jurisdiction to determine any question arising in any such proceedings. 24The second respondent then proceeded to address each of the orders sought in the applicants' applications for declaratory relief to show that none of them constituted an industrial matter for the purpose of s 154 of the IR Act, thereby depriving the Industrial Court of jurisdiction not only to make the declarations sought by the applicants, but also to transfer the proceedings to the Supreme Court. 25The third respondent's attitude to the transfer application was to disagree with the second respondent. Ms Heath of counsel for the third respondent submitted that s 151 of the Civil Procedure Act was concerned with "proceedings". Proceedings per se were not a nullity and the Court was entitled to transfer the proceedings without first having to determine whether an application before it was or was not within jurisdiction. This approach, it was submitted, was consistent with the overriding purpose of the Civil Procedure Act expressed in s 56, namely, "to facilitate the just, quick and cheap resolution of the real issues in the proceedings." 26Ms Heath submitted that given the second respondent accepted that the Supreme Court was the appropriate forum for dealing with claims made by Mr Hahn and that it was apparent the Industrial Court did not have power to deal with certain aspects of the claims, the appropriate course was to "cut to the chase" and transfer the proceedings. 27In relation to the second respondent's contentions regarding jurisdiction under s 154 of the IR Act, it was Ms Heath's submission that prior to this stage of the proceedings MetLife had not advanced submissions to the level of detail it now sought to make. The submissions now sought to be put were not part of the second respondent's original in globo argument on the motion, and even its latest written submissions filed in the proceedings did not descend to the level of detail evident in its oral submissions to the Court. 28It was submitted for the third respondent that before the Court should be prepared to make findings about whether or not the declaratory orders sought were within jurisdiction it needed to hear full argument and the applicants should be given the opportunity to amend their claims in light of the decision in Hahn (No 1). That had not occurred because in relation to Mr Hahn there were matters in respect of which the appropriate forum was the Supreme Court and in light of that the most convenient course was to transfer the industrial proceedings to the Supreme Court where all matters could be dealt with. 29Whilst the third respondent agreed to a significant extent with the second respondent's submissions that the declaratory orders sought by the applicants did not constitute industrial matters, it was submitted that on the second respondent's motion as framed by MetLife, and as argued by MetLife, the appropriate course was to dismiss the second respondent's motion. However, that did not mean at the end of the day the applicants could have all the declarations and orders they sought for the reasons the third respondent had submitted in the Hahn (No 1) proceedings. 30The applicants essentially agreed with the third respondent's submission in opposing the second respondent's dismissal application. In addition, however, it was submitted that the Court could not come to a final view about whether or not there was no jurisdiction. There were reasonable grounds to believe that given the wide jurisdiction available to the Court under s 154 of the IR Act, claims could be framed by the applicants that met the requirements of the section, that is, the Court may make binding declarations of right in relation to a matter in which the Commission (however constituted) has jurisdiction. 31The applicant submitted the Court should: (1)grant the transfer application in respect of Mr Hahn; (2)dismiss MetLife's motion; and (3)if the applicants so choose to amend their applications, grant leave to do so

Consideration 32I do not propose to dismiss the applicants' motions for declaratory orders. Whilst I consider that in light of my decision in Hahn (No 1) the scope for declaratory orders to be made under s 154 is significantly narrowed I cannot at this stage rule out entirely the possibility that some scope remains and may provide the basis for the applicants to proceed in relation to some aspect of their current applications to take advantage of that possibility or to amend the applications. 33It may be the second respondent is correct and no scope exists to exercise jurisdiction in respect of the current applications for declaratory relief. However, I have not heard from the applicants about each of the orders they seek because thus far their focus has been on defending their applications from the global attack by the second respondent, which did not descend to the level of addressing each order sought. 34The second respondent's dismissal motion in relation to Mr Hahn's application for declaratory relief pleaded that insofar as the "Application for Declaration Pursuant to section 154 of the Industrial Relations Act 1996 seeks relief against the second respondent, the application is not in respect of an "industrial matter". However, it was not until now that the second respondent addressed each of the orders Mr Hahn seeks in an endeavour to show they did not constitute industrial matters. In respect of Mr Dee and Mr Wild, the pleading was merely that "The Industrial Court is not seized of jurisdiction to hear and determine the application." Once again no attempt was made, until now, to address each of the orders sought by these two applicants. The second respondent filed no motion in relation to Mr Jifkins' application for relief, presumably on the basis that whatever was decided in relation to the other applications for relief would determine the fate of the Jifkins' application. 35It would not be appropriate to dismiss the applications for declaratory relief on the basis of a relatively brief traversal by the second respondent of arguments as to why the orders sought are not industrial matters and without having heard the applicants or considered any application for leave to amend in light of the decision in Hahn (No 1). If leave were to be sought and granted I would hear the applicants on their amended applications and any remaining jurisdictional objections. 36In the meantime, however, Mr Hahn has sought a transfer of his application to the Supreme Court. His motive for doing so would not appear to be objectionable. There are matters, apparently, of a contractual nature to be dealt with and damages are sought in relation to that contractual matter. Those are issues beyond the Industrial Court's jurisdiction. Mr Hahn has sought to maintain his application for declaratory relief and presumably have it joined to his other proceedings in the event I was to transfer his application for declaratory relief to the Supreme Court. That being so, any question of jurisdiction regarding his current application, or in respect of any amended application, would be dealt with in the Supreme Court. 37I propose to grant the application to transfer the proceedings in Matter No IRC 675 of 2013 to the Supreme Court pursuant to s 151 of the Civil Procedure Act. I am satisfied that in relation to the proceedings it is more appropriate for them to be heard in the Supreme Court. I agree with the third respondent and with the reasons it relied upon that it is unnecessary for me to first determine whether or not the application for declaratory relief is within jurisdiction. 38With the decision to transfer Mr Hahn's proceedings to the Supreme Court, any jurisdictional issue will be determined in that Court. It would be a matter for the second respondent to file a motion in the Supreme Court if there are jurisdictional objections to be taken either in relation to the transferred proceedings or in relation to any amended proceedings. Accordingly, as there would be nothing more to be done in this Court in relation to Mr Hahn's application for declaratory relief I propose to dismiss the second respondent's motion to dismiss the Hahn application. 39The other applications, those of Messrs Wild, Dee and Jifkins, remain with the Industrial Court. These applicants have urged me to dismiss the second respondent's motions to dismiss their applications, noting no such motion exists in relation to Mr Jifkins. However, whilst the second respondent did not address each of the orders sought in the applications in a timely way it could not be said that the scope of the pleadings in the second respondent's motions prevented it from doing so at some point whilst the applications for relief remained on foot. 40The position, therefore, is this: (1)the second respondent has had a measure of success in that Hahn (No 1) found no accrued right exists under the rescinded Award to pursue claims for benefits in relation to an on duty injury that was alleged to have resulted in a police officer suffering total and permanent disablement, such officer having been medically discharged prior to 9 December 2011; (2)the second respondent has belatedly argued, albeit within the scope of its pleadings, that each of the orders sought in the applicants' applications for declaratory relief are not in relation to an industrial matter and, therefore, the Industrial Court is without jurisdiction to determine the applications; (3)the applicants have not had a reasonable opportunity to deal with the second respondent's arguments regarding absence of jurisdiction or, in the alternative, to seek leave to amend their applications in light of the decision in Hahn (No 1); (4)consequently, the question of whether or not jurisdiction exists to grant the applications for relief in whole or in part has not yet been determined and the applications remain extant. 41In my opinion, it would not be an appropriate course to dismiss the second respondent's motions whilst the applications of Messrs Dee, Wild and Jifkins for declaratory relief remain on foot and the question of jurisdiction remains a live issue. 42In the circumstances, those applicants will need to determine the course they intend to follow. Do they wish to press their applications and in doing so deal with the second respondent's jurisdictional objections, or do they wish to seek leave to amend, or do they wish to adjourn the applications pending the outcome in the Hahn proceedings in the Supreme Court? 43These applicants will need to advise the Court and the other parties about their intentions and to do so within 21 days. Depending on what course the applicants choose it may be necessary to convene further hearings. 44Costs in all matters, including costs relating to the third respondent's motion, will be reserved until the applicants' intentions are known and the applications have been dealt with by the Court.

Orders 45The Court makes the following orders: (1)The Court, on the application of the third respondent, notes that the matters in paragraph 3, 36, 50 and 52 of the Court's reasons dated 10 April 2014 are not conceded by the third respondent and were not findings of fact or conclusions of law intended to be binding on it. (2)Proceedings in Matter No IRC 675 of 2013 are transferred to the Supreme Court pursuant to s 151 of the Civil Procedure Act 2005. (3)The notice of motion by the second respondent in Matter No IRC 675 of 2013 is dismissed. (4)The applicants in Matter Nos IRC 407, 602 and 682 of 2013 shall advise the Court and the parties to the proceedings within 21 days of the date of this judgment what orders they seek, apart from costs, in relation to their applications for declaratory relief. (5)Costs are reserved.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 29 August 2014