Victims Compensation Fund Corporation v District Court of New South Wales and Anor

Court of Appeal (NSW)|2002-09-09|Before: Sheller JA, Heydon JA, Einstein J, Mr P, Mr J, Commission J

CITATION : Victims Compensation Fund Corporation v District Court of New South Wales and Anor [2002] NSWCA 355 FILE NUMBER(S) : CA 40160/02 HEARING DATE(S) : 9 September 2002 JUDGMENT DATE : 23 October 2002

Victims Compensation Fund Corporation (Claimant) PARTIES : District Court of New South Wales (First Opponent) Shi Feng Ma (Second Opponent) JUDGMENT OF : Sheller JA at 1; Heydon JA at 2; Einstein J at 34

LOWER COURT JURISDICTION : District Court LOWER COURT DC 10172/01 FILE NUMBER(S) : LOWER COURT Garling DCJ JUDICIAL OFFICER :

Mr P R Sternberg (Claimant) COUNSEL : Submitting appearance (First Opponent) Mr J A Singh (Second Opponent)

I V Knight (Claimant) SOLICITORS : I V Knight (submitting appearance) (First Opponent) Sommerville & Co (Second Opponent) CATCHWORDS : Judicial review - common law judicial review - certiorari against decision of District Court judge - error of law on the face of the record - Courts - judges - powers - requirement that judicial power be exercised in resolution of "legal" controversy - D Supreme Court Act 1970 Victims Compensation Act 1996 LEGISLATION CITED : Victims Compensation Amendment Act 1998 Victims Compensation Act 2000 Victims Support and Rehabilitation Act 1996 Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 CASES CITED: Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 In Re Judiciary and Navigation Acts (1921) 29 CLR 257 Victims Compensation Fund v Brown [2002] NSWCA 155 DECISION : See paragraph 33

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40160/02 DC 10172/01

23 October 2002 VICTIMS COMPENSATION FUND CORPORATION v DISTRICT COURT OF NEW SOUTH WALES and SHI FENG MA

Judicial review - common law judicial review - certiorari against decision of District Court judge - error of law on the face of the record Courts - judges - powers - requirement that judicial power be exercised in resolution of a "legal" controversy

The second opponent was injured when she was attacked and her handbag was seized. A workers compensation claim filed by her was settled. The second opponent then claimed "statutory compensation" for "compensable injuries" under Part 2 of the Victims Compensation Act 1996 for the injuries she had suffered from the attack. An Assessor dismissed her application, finding the evidence incapable of establishing "shock" within the meaning of the Act. An appeal against that determination to the Victims Compensation Tribunal failed. The second opponent then sought leave for an extension of time to file an appeal to the District Court against the Tribunal's decision pursuant to s 39(1) of the Victims Support and Rehabilitation Act 1996. Leave was granted, the appeal was upheld, and the matter was remitted to the Tribunal for reconsideration according to law. The Victims Compensation Fund Corporation sought leave to appeal to the Court of Appeal seeking orders: (a) removing the record of these proceedings to the Court of Appeal; (b) quashing the orders of Garling DCJ; and (c) declaring that the first opponent erred in finding that Victims Support and Rehabilitation Act 1996 s 30(3) does not apply to determination of the claim for nervous shock. Held (Heydon JA, Sheller JA and Einstein J agreeing), granting leave to appeal and allowing the appeal, The abandonment in the District Court of any attempt to disturb the concurrent findings by the Assessor and the Tribunal that the Assessor had not established that she had suffered shock meant that any analysis of the construction of s 30(3) was a discussion of a question which was merely moot, theoretical, abstract, hypothetical and advisory. It was wrong to exercise judicial power to purport to decide a controversy which was not a "legal" controversy and to make orders which therefore were futile: [27], [29]. Re Judiciary and Nadivation Acts (1921) 29 CLR 257; Ainsworth v Criminal Justice Commission (1992) 175 CLR 564; Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334, considered.

IN THE SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CA 40160/02 DC 10172/01

SHELLER JA HEYDON JA EINSTEIN J

23 October 2002 VICTIMS COMPENSATION FUND CORPORATION v DISTRICT COURT OF NEW SOUTH WALES and SHI FENG MA Judgment 1 SHELLER JA: I agree with Heydon JA. 2 HEYDON JA: On 14 October 1997 the second opponent was injured when she was attacked and her handbag was seized. 3 On 18 July 2000 a claim she made for workers compensation entitlements was settled for $80,000. After repayments to the Health Insurance Commission and the Department of Social Security, she received $72,800. 4 The second opponent on or about 3 November 1997 applied for compensation in relation to her injuries pursuant to Part 2 of the Victims Compensation Act 1996. This provided for the payment of "statutory compensation" for "compensable injuries". These were set out in Schedule 1. One of the compensable injuries was "shock". Clause 5 of Schedule 1 provided: "The following applies to the compensable injury of shock: (a) Compensation is payable only if the symptoms and disability persist for more than 6 weeks. (b) The injury comprises conditions attributed to post traumatic stress disorder, depression and similar conditions. (c) The psychological symptoms include anxiety, tension, insomnia, irritability, loss of confidence, agoraphobia and pre-occupation with thoughts of self-harm or guilt. (d) The physical symptoms include alopecia, asthma, eczema, enuresis and psoriasis. (e) Relevant disabilities include impaired work or school or other educational performance, significant adverse effects on social relationships and sexual dysfunction."

The Victims Compensation Amendment Act 1998 omitted that provision and substituted another provision, but that does not matter for the purposes of this case. The name of the Act was amended to Victims Support and Rehabilitation Act by the Victims Compensation Act 2000. That does not matter either. 5 On 28 November 2000 the second opponent's application was dismissed by an Assessor. The Assessor found that the evidence was incapable of establishing "shock" as defined by clause 5 of Schedule 1. He said: "Pursuant to Clause 5 of Schedule 1 an applicant claiming the compensable injury of 'shock' must firstly establish an injury amounting to a recognisable mental illness and then must establish both symptoms and disability persisting for the entire period for which shock is claimed. Clause 5(3) provides that relevant disabilities may include impaired work, school or other educational performance, significant adverse effects on social relationships and sexual dysfunction. Impairment suggests an inability to perform or at least a diminution in performance. Any impairment, therefore, should not be trivial in nature but should materially impact on an applicant's functioning and should be demonstrable in concrete measurable terms."

The Assessor then analysed the evidence as follows: "I have carefully considered all of the evidence before me. Although I have no doubt that this incident was traumatic and distressing for the applicant, not least because of the purpose to which she had hoped to put the stolen money, I am unable to find that the evidence before me is capable of establishing 'shock' as defined by Clause 5, particularly in respect of the element of disability. Although I recognise the difficulties involved I find that the evidence provided is particularly lacking any detailed investigation of the applicant's premorbid functioning against which to compare her current functioning. Although the reports from Dr Morse and Dr Law refer to the applicant being admitted against her will into Rozelle psychiatric hospital by an 'insurance doctor' the Tribunal has been provided with no details of this admission or the findings of the responsible practitioner or the practitioners at the hospital. One of the primary areas of impairment relied upon is the applicant's occupational functioning. However I note that it appears that the applicant kept working after the act of violence and only told Dr Law on 15 May 1998, some seven months after the event, that she had been 'sacked' by her employer. At this stage the applicant was about 6 months pregnant and 3 months after being sacked gave birth to a child. There does not seem to have been any real consideration by the practitioners that this may have played a part in the applicant's change in occupational circumstances. Dr Law refers to the applicant's 'failed marriage' and states the view that this 'could have prolonged and worsened her PTSD symptoms'. Having considered all of the evidence before me I am just not satisfied that the extent of the applicant's 'emotional disturbance' and possible 'psychotic depressed state', to use the words of Dr Morse, is adequately explained by the practitioners or sufficiently linked to this act of violence alone, particularly in the absence of a proper investigation of her premorbid functioning. I am just not satisfied that 'shock' is established as claimed." 6 On 27 February 2000 the second opponent appealed against the Assessor's determination to the Victims Compensation Tribunal. 7 On 2 July 2001 the Tribunal dismissed the appeal. While it expressed agreement with the Assessor's conclusion, it advanced a further reason based on s 30(3) of the Victims Support and Rehabilitation Act 1996, as the legislation was now called. 8 On 10 October 2001 the second opponent filed an appeal to the District Court against the Tribunal's decision pursuant to s 39(1) of the legislation, which permitted appeals on questions of law. Section 39(2) provided that appeals were to be instituted within three months after the day when the notice of the Tribunal's determination was served, or such further time as the District Court might allow. It was common ground that the appeal was out of time, and hence an extension was needed. 9 On 18 December 2001 Garling DCJ granted an extension, upheld the appeal and remitted the matter to the Tribunal for reconsideration according to law. 10 This is an application by the Victims Compensation Fund Corporation inter alia for the following orders: "1. That the record of these proceedings before his Honour Judge Garling DCJ of the District Court Sydney on 18 December 2001 [No 10172 of 2001] be removed to this Court. 2. That the orders made by his Honour in the said proceedings be quashed. 3. A declaration that the first opponent erred in finding that s 30(3) of the Victims Support and Rehabilitation Act 1996 does not apply to the determination as far as a claim for shock is concerned." 11 The jurisdiction of the Supreme Court to entertain the Summons rests on s 69(1) and (3) of the Supreme Court Act 1970, since the application was in the nature of an application for certiorari based on an error of law on the face of the record, an expression which includes Garling DCJ's reasons for judgment: s 69(4). By reason of s 48(1)(a)(iv) and (2)(d), the proceedings in the Supreme Court were assigned to the Court of Appeal.

Two questions of law 12 In the written submissions of the parties filed before the day fixed for oral argument, as the declaration sought in paragraph 3 of the Summons suggested, the principal issue related to Garling DCJ's construction of s 30(3). A question about the construction of a statutory provision is unquestionably a question of law. 13 In the course of oral argument, another question came to light. It was contended that in Victims Compensation Fund v Brown [2002] NSWCA 155, a decision of this Court delivered on 28 May 2002, well after Garling DCJ's decision, the understanding of the law on which the Assessor had proceeded was revealed to be erroneous. In that case the Court of Appeal held that clause 5(a) did not require that the "symptoms" and the "disability" referred to in clause 5(a) of Schedule 1 both persist for more than six weeks; yet the Assessor apparently proceeded on the contrary view. The question whether the Assessor had applied a wrong construction of clause 5(a) is also a question of law. This question was not raised in argument with either the Tribunal or Garling DCJ. 14 However, these questions of law should not be further explored in this case for the following reasons, which centre on a point made briefly in the claimant's written submissions and more fully in oral argument, namely, that the Assessor had found that the second opponent had not established shock and that the Tribunal had upheld this.

The advisory nature of Garling DCJ's opinion 15 Section 39(1) of the Act provides: "An applicant for statutory compensation may, with the leave of the District Court, appeal to the District Court on a question of law arising in any determination of the application by the Tribunal."

The Notice of Appeal to the District Court was in the following terms: "1. The tribunal member made errors of law, or alternatively, made findings of fact not supported by the evidence. 2. That the tribunal member erred in affirming the determination of the compensation assessor who did not establish the compensable injury of shock. 3. That the tribunal member erred in law in enterprising [sic] section 30(3) of the Victims Support and Rehabilitation Act 1996. 4. That the tribunal member erred in not accepting that the appellant's symptoms would have manifested themselves within 24 hours of the act of violence." 16 Ground 2 was liable to have been struck out because on its face it advanced no question of law. 17 The Statement Pursuant to Part 6 Rule 60C(4) stated the following grounds of appeal: "(i) That the member erred in law in interpreting Section 30(3) of the Victims Support & Rehabilitation Act. (ii) That the member erred in not accepting that the appellant's symptoms would have manifested themselves within 24 hours of the act of violence."

Paragraph (ii) corresponds with Ground 4 in the Notice of Appeal. 18 In support of the ground of appeal described in the Statement as paragraph (ii), the Statement said: "The member found that the appellant's symptoms must have related to a pre morbid condition because of the complaint made to Dr Mok on the day after the assault of 'frequent nightmares'. This is a finding that it is not open to be made on the evidence before the Tribunal. There was no direct evidence of a pre morbid condition. As the correctly stated law has been applied to the facts to produce a conclusion which was not reasonably open then an error of law has been committed. Azzopardi v Tasman UEB Industries Limited 1985 4 NSWLR 139. The appellant court is in a situation in this case where it is able to assess the evidence that was before the Tribunal as well as the Tribunal itself. It is therefore open to interpret such evidence and apply the law as it sees fit. State Rail Authority of NSW v Earthline Constructions Pty Ltd & Ors (1999) 160 ALR 588." 19 Plainly this passage, though described as relating to paragraph (ii), and hence Ground 4, was also directed to supporting Ground 2. 20 The reference to the "complaint made to Dr Mok" is a reference to the following passage in the Tribunal's reasons for determination: "The following day [15 October 1997] the Appellant consulted Dr Charles Mok who noted she complained of: (1) pain over her chest, lower chin, right waist and left knee (2) discomfort in her left ear and reduced hearing in that ear (3) feeling anxious, poor sleep, frequent nightmares, symptoms of palpitations and headache If the Appellant was truthful and complained of 'frequent nightmares' the day following the assault, I can only infer that problem was caused by some pre-existing condition. Dr Mok, in conducting a mental examination, stated the Appellant was ' anxious and depressed '. I find it hard to accept these symptoms would have manifested themselves within 24 hours of the act of violence and must relate to a premorbid condition." 21 The reference to Azzopardi's case is a recognition that there are difficulties in characterising a finding which is supposedly erroneous for want of evidentiary support as a finding of law rather than a finding of fact. It was unclear, however, which part of the reasoning in the leading majority judgment of Glass JA was said to render the alleged error an error of law. The last passage quoted from the Statement, in saying there "was no direct evidence of a premorbid condition", is not inconsistent with the proposition that there was some indirect evidence of it, and the Assessor's reasons for determination point to indirect evidence of it. While the conclusion of the Assessor, and of the Tribunal in accepting what the Assessor said, may be mistaken, they are not conclusions of which it can be said that they were "not reasonably open". 22 In oral argument before Garling DCJ on 14 December 2001, counsel for the second opponent, in answering an inquiry from the judge as to what the case was about, said: "Well, there's two grounds of appeal. The second one is one I've if I can just deal with quickly your Honour, and that's in relation to a factual finding. As your Honour's aware you can only appeal on an error of law. HIS HONOUR: Yes. [COUNSEL FOR THE SECOND OPPONENT]: The factual finding is that the assessor or the magistrate found it hard to accept that symptoms might have manifested themselves, these are symptoms of stress within 24 hours. And that's in reference to a report of the victim's GP. Our submission simply on that point is that the assessor failed or the magistrate failed to look at the entirety of the evidence and came to a conclusion that was improper based upon one small piece of evidence. That's all I wanted to say about that point your Honour. The first point -- HIS HONOUR: So what the decision's not based on evidence? [COUNSEL FOR THE SECOND OPPONENT]: Yes. HIS HONOUR: Okay."

It is to be noted that though counsel for the second opponent agreed with Garling DCJ's characterisation of the point as being that the decision was "not based on evidence", it did concede that it was supported by "one small piece of evidence". 23 Counsel for the second opponent then turned to the s 30(3) point. A little later counsel for the claimant said that the s 30(3) point was one "which I take to be the only real points in the pending appeal". That contention was not contradicted by counsel for the second opponent, and indeed he accepted that the point relating to the absence of evidence about the finding that there was no shock was not pressed. The relevant exchange was as follows: "HIS HONOUR: The reason you don't press your first ground I take it is because that wasn't the reason this decision was made. [COUNSEL FOR THE SECOND OPPONENT]: That's correct your Honour."

It may not have been correct for Garling DCJ and counsel to have thought that the finding about the absence of shock was not a reason for the Tribunal's decision. It is true that the second half of the Tribunal's reasons for determination deal with s 30(3), but in the first half the Assessor's finding that there was no shock was accepted, and that acceptance was never thereafter qualified or withdrawn. Ground 2 of the second opponent's Notice of Appeal to the District Court certainly treated the Tribunal's affirmation of the Assessor's conclusion on shock as a reason for its decision. At all events, whatever the reason the second opponent had for abandoning any point turning on the absence of evidence for the finding of no shock, the point was abandoned. That it was abandoned was reiterated a little later, when Garling DCJ said that the construction of s 30(3) was "the only really relevant point … I have to look at", and counsel for the second opponent agreed. Counsel for the claimant was silent. 24 Garling DCJ referred to the abandonment of the factual point in his reasons for judgment in the following terms: "As the matter was argued before me there was no dispute about the facts or any matter other than in effect the application of Section 30(3) of the Victims Support and Rehabilitation Act 1996 …. There was a secondary argument before me relating I think to evidence, but it was not really argued and had no merit at all. The real point of this appeal is the effect of Section 30(3) …."

That was the polite way of recording the fact that the no evidence point had been abandoned. The decision of counsel for the second opponent to abandon it was not only correct, but was inevitable. 25 Though during the oral argument before this Court it was suggested that the transcript from which quotations appear above was defective in that it erroneously identified which particular counsel was speaking, this Court directed that an agreed transcript be supplied. It was supplied, attached to the claimant's further written submissions. Neither those written submissions nor the second opponent's written submissions in answer to them raise any issue about the correctness of the transcript. 26 Thus it had become plain fairly early on in the argument before Garling DCJ that there were concurrent findings by the Assessor and the Tribunal that the Assessor had not established that she had suffered shock. The attempt in the appeal papers to disturb those findings had been abandoned. Any prospect of the second opponent obtaining a monetary recovery in relation to shock had thus vanished. 27 The analysis by Garling DCJ of the construction of s 30(3) was thus a discussion of a question which was merely moot, theoretical, abstract, hypothetical and advisory. The same would have been true if the other question of law raised before this Court, namely the construction of clause 5(a) of Schedule 1, had been raised. It is wrong for judicial power to be exercised in answering questions of that character. Whatever answer was arrived at in relation to s 30(3) could have had no consequences for the parties in these particular proceedings. It was wrong for Garling DCJ to exercise his judicial power to purport to decide a controversy which was not a "legal" controversy; in truth he was only answering an "abstract or hypothetical" question having "no foreseeable consequences" for the parties: see Ainsworth v Criminal Justice Commission (1992) 175 CLR 564 at 582 per Mason CJ, Dawson, Toohey and Gaudron JJ. A judicial determination "involves a conclusive or final decision based on a concrete and established or agreed situation which aims to quell a controversy": Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at [45] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ. Here there was a controversy, but it was not one which could be quelled by any particular outcome of the debate about s 30(3): the controversy had already been quelled by the findings negating shock and by the second opponent's abandonment of any challenge to them. And at [47] in Bass's case the court said: "Because the object of the judicial process is a final determination of the rights of the parties to an action, courts have traditionally refused to provide answers to hypothetical questions or to give advisory opinions." The question of what s 30(3) meant was only hypothetical, because it rested on the hypothesis that there was shock, and the second opponent had not proved this. The opinion offered on the hypothetical question was only advisory, because there was no "immediate right, duty or liability to be established by the determination of the Court" in the sense in which those words were used in In Re Judiciary and Navigation Acts (1921) 29 CLR 257 at 265 per Knox CJ, Gavin Duffy, Powers, Rich and Starke JJ. That was a case on Chapter III of the Constitution, but the principles stated are relevant even to courts not exercising Chapter III jurisdiction.

The futile character of Garling DCJ's orders 28 There are important reasons of legal policy underlying the rule that judicial power cannot be exercised to give merely advisory opinions in answer to hypothetical questions. But the reasoning of Garling DCJ was unsatisfactory not merely because it contravened that rule and ignored those reasons; it was also unsatisfactory in leading to a futile outcome. His fourth order was "I return the matter to the tribunal for consideration according to law as set out in my reasons". Once he had decided to extend time for the institution of the appeal and to entertain it on its merits, and once his reasoning had led him to the conclusion that the Tribunal's reasoning was erroneous, he had no alternative but to make that order because of s 39(5) of the Act. It provided: "On an appeal, the District Court may only: (a) affirm the determination of the Tribunal, or (b) set aside the determination and remit the matter to be considered and determined again by the Tribunal (either with or without the hearing of further evidence) in accordance with the decision of the District court on the question of law concerned."

But that order was an exercise in futility. Why should the Tribunal, at a future hearing, depart from the Assessor's finding that there had been no shock, particularly since the Tribunal had already found no error in that finding? If the appeal could lead only to a futile outcome, it was erroneous to hear it. 29 In these circumstances Garling DCJ should not have exercised his discretion to extend time for the institution of the appeal, and even if the appeal had been filed in time, the determination of the Tribunal should have been affirmed because to take the other course would involve giving advisory opinions and produce futility. These errors are apparent on the face of the record, and they are errors of law. 30 It follows that it is not either necessary or desirable to say anything about the assumptions or conclusions as to the law on which the Assessor, the Tribunal or Garling DCJ proceeded.

Orders 31 In the circumstances orders should be made to the effect of paragraphs 1 and 2 of the Summons. The effect of those orders will be to leave the Tribunal's order dismissing the appeal from the Assessor on foot, and will also leave on foot the Assessor's order dismissing the application. 32 The claimant indicated that it agreed to pay the second opponent's costs of the appeal in any event. Nothing was said about the costs before Garling DCJ. The quashing of his orders has the result that the parties will bear their own costs before him, and that result is not unjust. 33 The following orders are proposed:

That the record of these proceedings before his Honour Judge Garling DCJ of the District Court Sydney on 18 December 2001 (No 10172 of 2001) be removed to this Court.

That the orders made by his Honour in the said proceedings be quashed.

That the claimant pay the second opponent's costs of the appeal.

That there be no order as to the costs of the first opponent. 34 EINSTEIN J: I agree with Heydon JA.

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