Court of Appeal (WA)|2004-01-22|Before: Malcolm CJ

Western Power Corporation v McMullen [2004] WASCA 3 (22 January 2004)

JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA

CITATION : WESTERN POWER CORPORATION -v- McMULLEN [2004] WASCA 3

Workers' compensation - Constraints on awards of common law damages - Form 22 application - Relevant level of disability nominated was "not less than 30%" - Whether finding of an alternative level of disability open to Review Officer

Workers' Compensation and Rehabilitation Act 1981 (WA), 93E(3), s 93C, s 93D(5)

1 MALCOLM CJ: In my opinion, this appeal should be allowed and the decision of the Review Officer should be quashed for want of jurisdiction. I have reached this conclusion for the reasons to be published by Wallwork AJ with which I am in entire agreement.

2 MILLER J: I have had the opportunity of reading in draft the reasons for judgment of Wallwork AJ. I agree with those reasons and I agree that the appeal should be allowed on grounds (1) and (2) of the grounds of appeal. It is unnecessary, in my view, to consider grounds (3), (4) and (5).

3 I am of the view that reg 19J of the Workers' Compensation and Rehabilitation Regulations (inserted into those regulations by the Workers' Compensation and Rehabilitation Amendment Regulations No 11 of 1999) has the result that a Review Officer, when presented with a Form 22, is called upon to determine "one and only one" relevant level of disability. In my view it is not open to a worker to seek from a Review Officer an alternate determination, namely a determination that he has a disability of not less than 30 per cent, or in the alternative, if it is concluded that it is something less than 30 per cent, a disability of not less than 16 per cent. To the extent that the learned Compensation Magistrate considered this was open to a Review Officer to decide, I consider his Worship to have erred.

4 I agree with Wallwork AJ that the Regulations were amended as a direct consequence of observations I made in Re Monger; Ex parte Ivey [1999] WASC 250 and I agree with his Honour that amendment of the Regulations was adequate to clarify the position without the need for any amendment to the Act itself.

5 This appeal is concerned with Part IV, Division 2, of the Workers' Compensation and Rehabilitation Act 1981 which provides for "Constraints on awards of common law damages."

6 The relevant sections of the Act apply to the awarding of damages against a worker's employer independently of the Act in respect of a disability suffered by a worker if the disability was caused by the negligence or other tort of the worker's employer and compensation has been paid, or is payable, in respect of the disability under the Act, or would have been paid or been payable but for the provisions of s 22 of

the Act. Section 22 is concerned with serious and wilful misconduct and is not relevant to this appeal.

7 Pursuant to s 93E(3), damages can only be awarded if -

"(a) it is agreed or determined that the degree of disability is not less than 30% and that agreement or determination is recorded in accordance with the regulations; or

(b) the worker has a significant disability [being one where it is agreed or determined that the degree of disability is not less than 16% and the agreement or determination is recorded in accordance with the regulations] and elects, in the prescribed manner, to retain the right to seek damages and the election is registered in accordance with the regulations." (My words in brackets)

8 It can be seen from s 93E(3) that there are only two circumstances where damages can be awarded and they are quite different. In the second case (s 93E(3)(b)), the worker must elect in the prescribed manner to retain the right to seek damages and the election must be registered in accord with the regulations. In the first case (s 93E(3)(a)), there is no election required.

9 It is significant that the sections of the Act in Division 2 of Part IV are concerned with "constraints on awards of common law damages". The Legislature in this Division is limiting the occasions on which common law damages can be awarded. Section 93C provides:

"If this Division applies a court is not to award damages to a person contrary to this Division."

10 This appeal is from an order of the Compensation Magistrate's Court, made on 1 November 2001, which dismissed the appellant's appeal to that Court. The appeal to the Compensation Magistrate had been from a decision of a Review Officer made on 31 January 2002 which allowed the respondent to seek a determination in relation to a degree of disability of not less than 16 per cent (s 93E(3)(b)) after the respondent had referred his claim to a disagree of disability of not less than 30 per cent (s 93E(3)(a)) to the Director pursuant to s 93D(5) of the Act.

11 It is contended by the appellant that the learned Compensation Magistrate and the Review Officer, erred in law in concluding that it was open to a Review Officer to determine the respondent's degree of disability at 16 to 29 per cent, when the level nominated on the respondent's Form 22 under the Regulations was not less than 30 per cent.

12 The appellant submits that the learned Magistrate should have held that the question which was referred to the Director pursuant to s 93D(5) of the Act was confined to whether the respondent had sustained a degree of disability of not less than the relevant level nominated by the respondent in his Form 22 application which was "not less than 30 per cent"; that a finding of an alternative level of disability to that claimed in the Form 22 was not open to the Review Officer, as that was not the question which had been referred by the Director for determination.

13 It was contended for the appellant that if the worker sustained a degree of disability of not less than 16 per cent the legislative intention in that Division of the Act was clearly to restrict the time in which the worker could make an election to retain the right to common law damages; further, that the learned Magistrate had erred in failing to conclude that the Review Officer was acting ultra vires in purporting to determine the respondent's relevant level of disability at not less than 16 per cent, but less than 30 per cent, when the dispute which had been referred to the Director for determination was whether the degree of disability was not less than 30 per cent.

14 On about 11 April 2000, the appellant had accepted liability to make weekly payments of workers' compensation to the respondent. On 19 July 2000, the respondent had lodged a Form 22 seeking a determination of a relevant degree of disability of not less than 30 per cent in relation to his injury, which he described as "lumbar spine and psychological problems" sustained during the course of his employment on 10 February 2000.

15 On 1 August 2000, the appellant lodged a Form 23 notice in the Conciliation and Review Directorate disputing the degree of disability which had been alleged by the respondent. Approximately 15 months later, by letter dated 28 November 2001, the respondent in effect requested that if his claim for not less than 30 per cent failed, the Review Officer make an alternative determination of a degree of disability of less than 16 per cent.

16 On 31 January 2002, a review hearing was conducted in order to resolve preliminary issues. One of those issues was whether the appellant, if he failed in his claim for not less than 30 per cent, could seek an alternative determination of a degree of disability of not less than 16 per cent. On 31 January 2002, the Review Officer determined that the respondent could in these circumstances seek a determination in relation to a degree of disability of not less than 16 per cent. The Review Officer gave extempore reasons for his decision. On 28 February 2002, the appellant lodged a notice of appeal from that decision.

17 On the appeal, in the course of her reasons for judgment, the learned Magistrate noted that s 93E(5) provides that:

"Subject to subsections (6) and (7), if weekly payments of compensation in respect of the disability have commenced an election cannot be made under subsection (3)(b) [where it has been agreed or determined that the degree of disability is not less than 16%] after the termination day." (My words in brackets.)

18 Pursuant to s 93E(b), in certain conditions, the Director has the power to extend the period within which an election can be made under subs (3)(b) with 14 days after the Director gives notice in writing to the worker that an agreement or determination has been recorded.

19 Section 93D provides for the assessment of disability. It is clear from that section and s 93E, that a degree of disability of not less than 30 per cent and a "significant disability" (not less than 16 per cent) are different concepts. In s 93E(3) they are treated as different matters. One difference is that where there is a degree of disability of not less than 16 per cent the worker is required to make an election to retain the right to seek damages. Where there is a degree of disability of not less than 30 per cent, the worker is not required to make an election.

20 Further, pursuant to s 93E(8), and subject to ss 9 and 11, where an election has been made under s 93E(3)(b) (which concerns an allegation of a disability not less than 16 per cent), compensation under the Act is not payable in respect of the disability in relation to any period after the day on which the election is registered.

21 The learned Magistrate referred to the decision of Miller J in Re Monger; Ex parte Ivey [1999] WASC 250 where, amongst other things, his Honour stated:

"It cannot be the case that if the applicant simply ticks the 'not less than 30%' box on the Form 22 he or she is precluded from the benefit of the provisions of s 93D(7) et seq where the medical practitioner's report fails to indicate a relevant level of not less than 30 per cent but nevertheless reveals a relevant level of not less than 16 per cent. If it were the case that a worker was to be bound by an election in the Form 22, s 93D(6) could easily have provided that the medical practitioner's opinion must indicate a degree of disability of not less than one of, and only one of, the relevant level. Likewise, reg 19J (which I consider to be within power by reason of the general regulation-making power contained within s 176(1)(a) of the Act) could have required a referral made in the form of Form 22 in Appendix 1 to nominate one, and only one, relevant level of disability being claimed. The form itself could also have required the worker to nominate one and only one relevant level, indicating that the level elected for would be limiting and binding."

22 The learned Magistrate noted that the decision in which Miller J made the above comments was delivered on 10 December 1999. Further, that on 14 December 1999 amending regulations were published in the Western Australian Government Gazette. Regulations 19J, 19M and 19N were repealed and new regulations, similarly numbered with an additional 19P were published. In addition, Forms 22 to 27 were deleted. Similarly numbered forms were inserted.

"19J Assessment of degree of disability

(1) A referral under section 93D(5) of the Act -

(a) is to be made in the form of Form 22 in appendix I;

and

(b) is to nominate in the Form 22 one, and only one, relevant level of disability in respect of which the referral is made."

24 Her Worship also noted that Form 22 was amended to include the words, inter alia, "nominate only one relevant level of disability."

25 The words in reg 19J(1) requiring a referral in the relevant Form 22 to nominate "one, and only one, relevant level of disability" apparently come directly from the words of Miller J in Ivey (supra). Also, the amendment to the Form to include the words, inter alia, "nominate only one relevant level of disability", appears to put into effect Miller J's other suggestion concerning the regulations. Miller J suggested that be done to indicate "that the level elected for would be limited and binding."

26 The Act itself was not amended, but it seems to me that the Legislature's intention is clear. The words in the amendments to the Regulations appear to be taken from Miller J's reasons for judgment to effect his Honour's suggestion that, if a worker is to be bound by an election in the Form 22, that would be a way to do it.

"Under the Act, a worker who has an agreed or determined degree of disability of not less than 16%, that is a 'significant disability', who wishes to pursue a common law claim, must elect between the continued receipt of statutory benefits and the right to seek common law damages [s 93E(3)(b)]."

28 Her Worship said the election must be made within six months from the commencement date of weekly payments (s 93E(5)). Sections 93E(6) and 93E(7) enable the election period to be extended in certain circumstances.

29 The learned Magistrate also added in her reasons that:

"Once a worker has made an election under s 93E(3)(b), any compensation under the Act is no longer payable in relation to any period after the day on which the election is registered (s 93E(8)). There is no restriction if the degree of disability is not less than 30%."

30 The learned Magistrate noted that s 93E(8) stipulates that a dispute arises if the employer considers the degree of disability is less than the relevant level. Her Worship said that the words "relevant level" are defined to include two alternatives.

31 In s 93D(1) the words "relevant level" in relation to a question as to the degree of disability of the worker are defined to mean:

"(a) if the question arises for the purposes of section 93E(3)(a), (9) or (12), a degree of disability of 30%; or

(b) if the question arises for the purposes of section 93E(4), a degree of disability of 16%."

32 The two alternatives deal with two significantly different situations. It seems that where the disability is not less than 16 per cent, a worker is discouraged from making a common law claim because if he elects to retain the right to seek damages, the workers' compensation payments cease. That is not the situation where he claims that the disability is not less than 30 per cent.

33 In this case if the respondent was prepared to claim that his disability was not less than 16 per cent, he could have done that by lodging a second form. That would have had consequences different from those he faced by claiming that his disability was not less than 30 per cent. His claim for the greater disability enabled him to retain his workers' compensation payments and proceed with his greater claim at common law.

"The issue is: does a reading of the Act, with the regulations, reveal a clear intention to prohibit a Review Officer from considering the alternative provided within the definition of 'relevant level' when a referral is instigated by only one Form 22 nominating degree of disability of not less than 30%?"

35 In my view, and perhaps with hindsight, it is difficult to see any other reason for the amendment of reg 19J with the requirement that there be nominated in a Form 22 "one, and only one, relevant level of disability in respect of which the referral is made", if the referral is to include both relevant levels of disability.

"If within 21 days after being notified under subsection (7) the employer notifies the Director in accordance with the regulations that the employer considers that the degree of disability is less than the relevant level, a dispute arises for the purposes of Part IIIA."

"The Director is to consider the dispute in consultation with the parties."

38 The learned Magistrate noted that the submission was that "regulation 19J effectively requires a worker to lodge two Form 22s if she or he wishes to have a degree of disability of not less than 16 per cent and of not less than 30 per cent referred to the employer." The learned Magistrate came to the view that the situation was not clear. The ground of appeal which relied on that submission was dismissed.

39 The submission for the appellant was that the question referred by the Director pursuant to s 93D(10) of the Act was "whether the degree of disability is not less than the relevant level" - Malcolm CJ in Re Monger; Ex parte Dutch [2001] WASCA 220; (2001) 25 WAR 96 at 107 (par 25). It was "not what is the degree of the disability?"

40 I am aware of the discussion in Pearce & Geddes Statutory Interpretation in Australia 5th ed concerning the use of delegated legislation to interpret ambiguous statutory provisions.

41 In this case there is an overall statutory scheme. The regulations are part of it. They were amended to supply additional information to assist the scheme and to cure the difficulties which had been referred to by Miller J in Ivey. His Honour's words were used in the amended regulation. In my view, there was no need to amend the Act.

42 In my opinion the Review Officer erred in law in that he had no jurisdiction pursuant to s 93D(1) to consider the question of whether the respondent had sustained a degree of disability of not less than 16 per cent because the dispute between the appellant and the respondent and the "question" referred pursuant to s 93D(5), (6), (7), (8) and (10) was whether the relevant degree of disability was "not less than 30 per cent" - refer to the Form 23 signed by the Director and by the appellant on 1 August 2000 at Appeal Book p 66.

43 For the above reasons, in my opinion, the appeal should be allowed.

Compensation and Rehabilitation Act 1981

Western Power Corporation v McMullen [2004] WASCA 3

At a glance

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Judgment (57 paragraphs)

Western Power Corporation v McMullen [2004] WASCA 3 (22 January 2004)

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