NASSIM ATTILEH v STATE RAIL AUTHORITY OF NEW SOUTH WALES

HELD: The mandatory procedures in Chapter 7, Part 2, Division 2 of the WIM Act apply to the making of any type of work injury claim after 1 January 2002, even if the injury was sustained prior to 30 June 1987. Schedule 6 Part 18C cl 8 WC Act is explicit on this point. Thus, the proceedings instituted by the appellant were required to be summarily dismissed.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40190/2003

MASON P SANTOW JA TOBIAS JA

1 MASON P: On 11 April 2002 the appellant commenced proceedings in the District Court against the respondent, his former employer. It was a claim in negligence for industrial deafness stemming from employment between 1969 and May 1985. The appellant had previously obtained leave pursuant to s60G of the Limitation Act 1969. 2 Chapter 7, Part 2, Division 2 of the Workplace Injury Management and Workers Compensation Act 1998 (the WIM Act) prescribes procedures to be complied with inter alia before commencing court proceedings for the recovery of work injury damages. Section 259 states: Application of Division (1) This Division applies to the making of a claim after the commencement of this section (even if the injury concerned was received before the commencement of this section). (2) However, this Division does not apply to the making of a claim for work injury damages if court proceedings to recover the work injury damages concerned were commenced before the commencement of this section. The commencement date was 1 January 2002. 3 None of the procedural requirements stipulated in Division 2 were satisfied before the statement of claim was filed in the present case. 4 The appellant submits that, despite the generality of the language of s259(1), there was no obligation to comply with Division 2 because the damages sought in the statement of claim relate to events prior to 30 June 1987 when Part 5 of the Workers Compensation Act 1987 (the WC Act) commenced. 5 Bowden ADCJ rejected this submission. He upheld the opponent's notice of motion and ordered summary dismissal of the proceedings. Since it was common ground that the matter raises an issue of general importance, the Court gave leave to appeal. 6 Until 1987, claims by employees against employers for damages in respect of work-related injuries were generally regulated by the common law. (I say "generally" because of statutory intrusion in relation to the doctrine of common employment, contributory negligence etc and because employers have long been required to take out insurance in this area.) 7 In 1987, Part 5 of the WC Act (esp ss149 and 150 thereof) abolished "common law rights" to recover damages from employers in respect of injuries for which employers were liable to pay compensation under that Act. Those provisions came into force on 30 June 1987. This situation continued until the enactment of the Workers Compensation (Benefits) Amendment Act 1989, as a result of which a new Part 5 was inserted into the WC Act. The new Part 5 (headed "Common Law Remedies") repealed the original ss149 and 150. Divisions 2 and 3 of Part 5 restored the right to "common law damages" by employees against employers, with modifications (see generally Pye v Butterfield Cheese Factors Pty Ltd (1996) 39 NSWLR 425). The principal modifications involved the obligation to elect between a claim for common law damages and a claim for lump sum compensation under the WC Act, caps on damages for non-economic loss and some forms of economic loss, and thresholds before common law damages could be recovered. 8 Part 5 of the WC Act (as inserted in 1989) applied only to injuries suffered after 4pm on 30 June 1987 (see s151U and Schedule 6, Part 14, cl 1 of the WC Act). 9 The effect of these provisions was that two separate regimes operate in parallel, as regards substantive rights in claims for damages for workplace injuries. The distinction between the two regimes turns on the date on which the injury occurred. In respect of injuries occurring before 4pm on 30 June 1987 claims at common law are generally unrestricted; whereas, in respect of injuries occurring afterwards, the substantive limitations in Part 5 of the WC Act apply. 10 One corollary is that it is open to a worker suffering hearing loss as the result of the employer's negligence occurring prior to 4pm on 30 June 1987 to recover damages at common law in respect of the consequences of such negligent acts (see generally Hobbs v Costain Australia Ltd (1995) 11 NSWCCR 56). This is the basis of the appellant's conceded right to seek damages that are not subject to the caps and election procedures stipulated in Part 5 of the WC Act. 11 At this point the parties' submissions diverged. 12 The respondent submits that any right to commence proceedings after January 2002 in relation to pre-1987 injuries is subject to the mandatory procedural pre-requisites in Chapter 7, Part 2, Division 2 of the WIM Act (hereafter "Division 2") enacted in 2001. The appellant submits that those requirements are confined to claims with respect to injuries suffered after 4pm on 30 June 1987. 13 At the hearing of the appeal the matter at issue between the parties focussed upon the interpretation of s259 of the WIM Act, set out at par [2] above. 14 The application of Division 2 is not excluded by s259(2), because the instant proceedings were commenced after 1 January 2002. The dispute between the parties concentrated upon the parenthetical clause in sub-s(1). 15 The respondent submitted that the parenthetical clause is quite general in its effect and that it does not draw or permit any distinction between injuries before and after 30 June 1987. 16 In brief, the appellant submitted that the generality of the language must be read down so as to exclude his situation. He invoked the well-known principles in relation to the preservation of vested rights stated by Dixon CJ in Maxwell v Murphy (1957) 96 CLR 261 at 267. The appellant also submitted, and the respondent disputed, that reading down is consonant with the disclosed purposes of the relevant provisions of the WIM Act (cf s33 of the Interpretation Act 1987, Saraswati v The Queen (1991) 172 CLR 1 at 21).

The impact of Division 2 if it applies 17 It is convenient first to examine the general scheme of Division 2, particularly with reference to its putative application to the appellant. 18 The long title of the WIM Act is: An Act to provide for the effective management of work-related injuries and injury compensation for workers in respect of such injuries; and for other purposes.

19 The WIM Act (s4) uses the expression claim to mean: … a claim for compensation or work injury damages that a person has made or is entitled to make.

Compensation means compensation under the Workers Compensation Acts, including any monetary benefit under those Acts. Work injury damages has the same meaning as in Chapter 7 (New claims procedures). 20 The appellant's claim is for work injury damages. 21 Chapter 7 of the WIM Act (ss250-377) addresses New claims procedures. It was inserted by the Workers Compensation Legislation Amendment Act 2001 (No 61 of 2001) and amended by the Workers Compensation Further Amendment Act 2001 (No 94 of 2001). 22 Key definitions are found in s250, including the following: damages has the same meaning as in Part 5 (Common law remedies) of the 1987 Act. [See s149 of the WC Act .] existing claim means a claim for compensation that is made before the commencement of this section or a related claim that is made or entitled to be made (whether before or after the commencement of this section). existing claim matter means any matter arising under the Workers Compensation Acts in respect of an existing claim. new claim means any claim (made or entitled to be made) that is not an existing claim. new claim matter means any matter arising under the Workers Compensation Acts in respect of a new claim. related claims are claims or further claims for compensation in respect of the same injury, whether or not the claims are in respect of the same kind of compensation. work injury damages means damages recoverable from a worker's employer in respect of: (a) an injury to the worker caused by the negligence or other tort of the employer, or (b) the death of the worker resulting from or caused by an injury caused by the negligence or other tort of the employer, whether the damages are recoverable in an action for tort or breach of contract or in any other action, but does not include motor accident damages.

23 Chapter 7, Part 2, Division 1 (Notice of injury) applies only in respect of injuries received on or after 1 January 2002 (see s252). This Division requires an injured worker to give prompt notice of injury to the employer and, subject to special circumstances, precludes the recovery of compensation or work injury damages where such notice has not been given (s254). This Division has no application to the appellant. 24 Division 2 (Making a claim for compensation or damages) contains ss259-264. Section 259 (Application of Division) has been set out above. 25 Section 260 stipulates that a claim must be made in accordance with the applicable requirements of the WorkCover Guidelines. 26 Section 261 deals only with a claim for compensation and it imposes a six month time limit, subject to various dispensations. This provision has no bearing on this appeal, because the appellant is claiming damages, not compensation. 27 It is s262 that is fatal to the instant proceedings if applicable to them. It states that: Court proceedings for the recovery of work injury damages cannot be commenced until a claim for the damages has been made. 28 Section 264 lays various duties upon employers with respect to forwarding claims to insurers. Part 3 (Dealing with claims) (ss265-286) prescribes the manner in which insurers and others must deal with the claims. 29 It is common ground that compliance with s262 is mandatory, with the consequence that proceedings commenced in breach thereof are of no legal effect and must be dismissed (cf Baker v Rothmans of Pall Mall (Australia) Ltd [1999] NSWCA 245, 18 NSWCCR 374, Emad Trolley Pty Ltd v Shigar (2003) 57 NSWLR 636). The defendant may waive the right to invoke s262 (see generally Gordon v Berowra Holdings Pty Ltd [2005] NSWCA 27), but there is no suggestion that this has occurred in the present case. 30 If Division 2 applies generally with respect to the proceedings instituted by the appellant in April 2002 then those proceedings were required to be summarily dismissed because they were not preceded by the appellant making a claim for damages as required by s262. This was the basis of the order of Bowden ADCJ that is under appeal. 31 If necessary, the respondent points to additional provisions in Chapter 7 that create problems for the appellant:

• Section 280A provides that a claim for work injury damages in respect of an injury cannot be made unless a claim for lump sum compensation in respect of the injury is made before or at the same time as the claim for work injury damages. It would appear that this has not occurred in the present case.

• Part 6 of Chapter 7 deals generally with court proceedings for work injury damages. In the main, it deals with matters procedural. As regards the present appellant, there would appear to have been non-compliance with ss313 (preventing commencement of Court proceedings unless disputes as to degree of permanent impairment have first been assessed by an approved medical specialist), 315 (requiring claimants to serve a pre-filing statement before commencing court proceedings) and 318A (requiring claimants to mediate claims before commencing court proceedings).

The critical issue analysed 32 There is nothing in these provisions in Division 2 that make them incapable of being complied with by a claimant for work injury damages who, like the appellant, seeks only "common law damages" because his or her claim is confined to injury prior to 30 June 1987. 33 Undoubtedly, Chapter 7 imposed additional hurdles upon all claimants for work injury damages who had not commenced proceedings by 1 January 2002 (cf s259(2)). But it was the scheme and purpose of the Chapter 7 to delay institution of court proceedings until insurers had proper opportunities to assess claims and have them mediated. 34 The learned primary judge held that the appellant's claims are new claims as defined in the WIM Act and that the appellant was bound to comply with that Act. The appellant's class (involving pre-1987 injuries for which the Limitation Act time bars have been lifted) will contain a very limited number of claims. However, they were required to satisfy the newly enacted procedure which (on his Honour's interpretation of s259(1)) extends to all injuries, not just those subject to Part 5 of the WC Act. 35 The Minister's second reading speech relating to the Bill that introduced Chapter 7 (No 61 of 2001) emphasised its procedural intent. It was described as containing "substantial measures to minimise disputes, as well as providing a fair system for resolving disputes should they arise". The Minister also described the Bill as "retrospective as to process but not in relation to benefit levels" (Parliamentary Debates, Legislative Council, 26 June 2001, p15283). This supports reading s259(1) with the generality suggested by its literal terms. 36 In its original form (introduced by Act No 61 of 2001) Chapter 7 dealt mainly with dispute resolution concerning compensation claims. The amendments introduced later in 2001 (by Act No 94 of 2001) applied and extended the procedures to claims for work injury damages. Most of the amendments effected by each enactment commenced on 1 January 2002. 37 When first enacted (by Act No 61 of 2001), s251 of the WIM Act provided that: Except as otherwise specifically provided in this Chapter, this Chapter applies to and in respect of new claims only. 38 A "new claim" was and is defined as any claim that is not an "existing claim". However, in Act No 61 "existing claim" was defined as a claim for compensation benefits or for damages in respect of an injury received before the commencement of the section. The full definition of existing claim was: (a) a claim for compensation made before the commencement of this section or a claim that is related to such a claim (whether or not the related claim is made before the commencement of this section), or (b) a claim for work injury damages made in respect of an injury received before the commencement of this section or in respect of the death of a worker resulting from or caused by such an injury.

39 Thus, when it came claims for damages, Act No 61 used the date of injury as the reference point to divide the new regime from the old. 40 Before the original s251 commenced, it was replaced (by Act No 94 of 2001) by the current form of that section. It now provides: Except as otherwise specifically provided in this Chapter, this Chapter applies to and in respect of new claim matters only.

41 The change in s251 is in the reference to "new claim matter", instead of "new claims". Act No 94 of 2001 also replaced earlier definitions of existing claim and new claim and inserted the current definitions of existing claim, existing claim matter, new claim and new claim matter as set out in par [22] above. 42 Under Act No 94 of 2001, "new claims" were still defined as claims that are not "existing claims". New claims obviously include claims for damages. But "existing claim" was now defined so as to refer only to claims for compensation. It followed that any claim for damages was now considered a "new claim" and potentially within the purview of Chapter 7 unless court proceedings had already been commenced (cf s259(2)). As the respondent points out, this changed the reference point for distinguishing the new regime from the old (as regards claims for damages) from the date of injury to the date proceedings were commenced. 43 The definition of new claim matter was inserted into s250 by Act No 94. A new claim matter is defined as: any matter arising under the Workers Compensation Acts in respect of a new claim.

44 After judgment was reserved the Court drew the parties' attention to s251 and the definition of "new claim matter" as they appear after Act No 94 of 2001. Written submissions were invited, and supplied, as to whether the appellant's proceedings represent a "new claim matter". The parties have agreed (by different routes) that the proceedings do not fall within this concept, because a claim for common law damages does not "arise under the Workers Compensation Act". 45 It follows that the appellant's claim for damages does not give rise to a "new claim matter". Accordingly, s251 of the WIM Act provides that Chapter 7 of that Act does not apply to the appellant's claim "except as otherwise specifically provided by [Chapter 7]" (s251). If matters stood there, the appellant might be able to argue that Division 2 is not engaged. The terms of s259(1) (set out at [2] above) are arguably not specific or emphatic enough to apply to a claim for work injury damages. The subsection arguably has ample work to do as regards new claim matters (as now defined) because much of Chapter 7 deals explicitly with (new) claims for compensation. 46 However matters do not rest there. 47 Schedule 6 of the WC Act contains savings, transitional and other provisions. Part 18C of that Schedule contains Provisions consequent on enactment of 2001 amending Acts. It was originally inserted by Act No 61 of 2001 and was amended by Act No 94 of 2001. 48 Clause 1 of Part 18C states that in this Part existing claims and new claim have the same meaning as in Chapter 7 of the WIM Act. 49 During the hearing of the appeal the parties directed submissions at the effect of cl 9(1) of part 18C which addresses amendments relating to common law damages. No attention was paid to cl 8 until the Court directed the Registrar to invite further submissions from the parties as to its effect. 50 Clause 8 provides: New procedures for making a claim (1) Division 2 of Part 2 (sections 259-264) and Divisions 2-5 of Part 3 (sections 274-286), except section 284, of Chapter 7 of the 1998 Act extend (subject to any modifications prescribed by the regulations for the purposes of this clause) to the making of a claim after the commencement of those sections even if the claim is an existing claim. (2) This clause has effect despite section 251 of the 1998 Act.

51 This clause appears to apply to the instant proceedings and to offer a complete answer to the appellant's claim in the circumstances. It is Division 2 of Part 2 of the WIM Act that contains the new procedures for making claims that has not been complied with by the appellant. Yet cl 8(1) stipulates that that Division extends to the making of a claim after the commencement of those sections even if the claim is an existing claim. (No modifications have been prescribed by regulation.) 52 Clause 8(2) is quite emphatic that cl 8 has effect despite s251 of the WIM Act. 53 "Claim" in the general context of Chapter 7, Part 2 Division 2 of the WIM Act embraces claims for compensation or damages unless the language of a particular section narrows it to a claim for compensation or a claim for damages as the case may be (see WIM Act, s4 (definition of claim)). Likewise for Schedule 6, Part 18C of the WC Act, because words in the WC Act have the same meanings as in the WIM Act, unless the WC Act provides otherwise (see WC Act, s3(1AA).). 54 The respondent gratefully embraced the point. It submits that cl 8 means that the proceedings must be dismissed for non-compliance with the new procedures for making a claim. 55 The appellant submitted that an action for damages involving an injury received prior to 4pm on 30 June 1987 is not an "existing claim" nor a "new claim" for the purposes of Part 18C or for the purposes of Chapter 7 of the WIM Act. The appellant points to the indicators that "existing claim" refers only to a claim for compensation (a proposition with which I agree, in light of the definition in s250). 56 The Note to the definition of "existing claim" in s250 (as that definition was amended by Act No 94 of 2001) states that: Part 18C of Schedule 6 to the 1987 Act provides for the transfer of existing claims, so that the claims transferred will be treated as new claims.

Part 18C undoubtedly does do this, in cll 5-6 of Part 18C. 57 But Part 18C addressed other matters as well, including the topic of cl 8. The language of that clause is intractably emphatic and it reinforces the generality of s259 of the WIM Act. It means that the new procedures found in Chapter 7, Part 2, Division 2 apply to the making of any type of claim after 1 January 2002. 58 The appeal should be dismissed with costs. 59 SANTOW JA: I agree with Mason P. I also agree with the additional observations of Tobias JA save that I prefer to express no final view as to whether s259(1) of the WIM Act is sufficiently specific to fall within the opening words of s251. 60 TOBIAS JA: I have had the benefit of reading in draft the judgment of the President. Subject to one matter, I agree with the orders proposed by his Honour for the reasons he has advanced. 61 My only reservation concerns his Honour's statement in [45] that the terms of s 259(1) of the WIM Act are arguably not specific enough to apply to a claim for work injury damages; that is, that arguably s 259(1) is not specific enough to fall within the opening words of exception in s 251. 62 My own preference is that s 259(1) is sufficiently specific to fall within the opening words of s 251. However, because of the effect on the appellant's claim of clause 8(1) of Part 18C of Schedule 6 to the WC Act, it is unnecessary to express a concluded view on that issue. It thus remains an open question. 63 Finally, I wish to add the following observations to supplement [56] and [57] of the President's reasons. 64 When construing clause 8 it is to be remembered that, by virtue of s 2A of the WC Act, the latter is to be construed with and form part of the WIM Act and, in the event of inconsistency, the WIM Act is to prevail. Accordingly, the reference to "claim" in the second-last line of clause 8(1) should, consistently with the above, be read down from its definition in s 4 of the WIM Act (whereby it includes both a claim for compensation and for work injury damages brought at any time) to a "new claim" in respect of a "new claim matter". The effect of the provision is to "extend" the provisions, inter alia, of Division 2 of Part 2 of Chapter 7 to such a claim "even if the claim is an existing claim". 65 The thrust of the appellant's supplementary submissions is that clause 8 should be construed as applying only to "existing claims" which, by definition, are confined to claims for statutory compensation. Like the President, I think it is broader than that. If it were so confined then it would have simply said that the identified provisions extended to "an existing claim". There would have been no need to make any reference to "the making of a claim after commencement of those sections even if the claim is an existing claim". In my opinion these words refer to the making of a "claim" including an existing claim. 66 The problem is that there would be no point to clause 8(1) if it only applied to a "new claim" in respect of a "new claim matter" because s 259(1) of the WIM Act so provides and it would not appear that clause 8 was intended to override s 259(2). Therefore, it seems to me that it is using the word "claim" in its defined sense as including not only a claim for statutory compensation but also a claim for the work injury damages which would include the appellant's claim. As that claim was only made after 1 January 2002, the effect of clause 8(1) is to apply, inter alia, Division 2 of Part 2 of Chapter 7 to it given that court proceedings to enforce the claim were not commenced prior to 1 January 2002 which, if they had been, would have exempted the claim from Division 2 pursuant to s 259(2). 67 Clause 8(2) is to be noted as it provides that clause 8(1) is to have "effect despite s 251 of the" WIM Act. In my opinion that is a clear indication that clause 8(1) exists to extend the identified provisions in Chapter 7 to the making of a claim after 1 January 2002 even though that claim is not in respect of a "new claim matter". The opening words of s 251 are irrelevant if only because they are confined to specific provisions in Chapter 7 of the WIM Act whereas we are now dealing with a provision of the WC Act. **********

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