Workers' Compensation (Common Law Proceedings) Act 2004

To understand the operation of this Act, one must grasp several highly technical concepts defined in Part 2 and the amended 1981 Act.

The distinction between the "amended provisions" and the "former provisions" is central to the statutory architecture. Under section 4(1), "amended provisions" refers to sections 93A to 93G of the 1981 Act as amended over time. These provisions represent a more restrictive legislative policy that limits a worker's right to seek common law damages by introducing strict thresholds regarding the degree of permanent disability. Conversely, the "former provisions" represent the pre-amendment state of those sections, which offered a significantly easier path for workers to bypass the statutory scheme and sue their employers for negligence.

A "former provisions matter" is defined under section 7(1) to include applications for leave to commence proceedings under the old rules, applications for leave to appeal a refusal to grant such leave, appeals from such refusals, or any proceeding that would have otherwise fallen under the old rules but for the saving provisions of section 6(4). Notably, the legislature explicitly carved out District Court file number WC 93D 1194/1998 from this definition, isolating that specific case from the jurisdictional bar.

The concept of a "determination" is broadly defined in section 6(1) to include any decision, ruling, order, award, judgment, settlement, or agreement. This definition is deployed in section 6 to ensure that any past resolution made on the assumption that the stricter amended provisions applied cannot be reopened, appealed, or set aside. This concept serves as a finality mechanism, preventing retrospective liability from destabilising past settlements.

The concept of "reasonable costs" under section 7(4) and (5) represents a statutory indemnity for workers whose active proceedings were retroactively extinguished. It is not defined by a fixed scale but is left to the administrative discretion of the Chief Executive Officer, subject to a right of dispute resolution where the matter can be referred to a District Court registrar or Supreme Court taxing officer to be taxed as if it were a standard taxation of costs.

Under the newly inserted sections 93EA and 93EB, the concept of the "termination day" acts as a temporal barrier. To qualify for the newly created pathways to re-refer a disability question, a worker must demonstrate that their original referral occurred not less than 21 days before this termination day, or before a day fixed by the Director, ensuring that only those who acted diligently under the original scheme can access the remedial gateways.

This legislation directly impacts four main groups within the Western Australian jurisdiction: workers, employers, insurers, and legal and administrative professionals.

For workers, the Act is a double-edged sword. It severely affects those with legacy common law claims under the "former provisions" by retroactively stripping them of their right to litigate, rendering their active court applications a nullity under section 7(3). However, it provides a vital lifeline to a highly specific subset of workers defined in sections 93EA and 93EB. These are individuals who attempted to refer disability questions before 30 September 2001 or before the 2004 Act's commencement but had their cases dismissed, set aside, or unaddressed due to technical evidentiary failures or confusion surrounding the applicable law. For these workers, the Act restores the right to seek common law damages, provided they meet strict criteria and comply with narrow timelines.

Employers and their workers' compensation insurers are heavily affected by the potential revival of historical common law liabilities. Insurers must re-evaluate closed or dormant files that may now be subject to re-referrals under sections 93EA or 93EB. However, the economic impact on employers is mitigated by section 11 (inserting section 154AC into the 1981 Act), which establishes a state-backed subsidy scheme. This scheme allows eligible employers to seek reimbursement from the Employers' Indemnity Supplementation Fund for damages costs that exceed prescribed regulatory thresholds.

Legal practitioners specialising in personal injury and workers' compensation are profoundly affected. Plaintiff lawyers must rapidly identify eligible clients to exploit the strict three-month re-referral windows under sections 93EA(4) and 93EB(4). They must also navigate the cost recovery process under section 7 to claim compensation for work done on annulled legacy proceedings.

Finally, the Act affects public administrators and judicial officers. The Director of the Commission and the Chief Executive Officer are granted significant administrative burdens and discretionary powers, including the duty to evaluate and notify parties of accepted referrals, and the duty to determine "reasonable costs" for aborted litigation. The District Court and Supreme Court registries are also affected, as their taxing officers are tasked with resolving disputes over these administrative cost determinations.

The Act establishes a complex matrix of statutory rights, accompanied by rigid administrative duties.

A primary right created by the Act is the worker's right to re-refer a question of disability to the Director under section 93EA(3) or 93EB(3). This right is highly conditional. The worker must demonstrate that they previously attempted a referral, and that a review officer refused to deal with the substance of the question or a court quashed a favorable decision based on technical non-compliance with section 93D(6) or transitional confusion. To exercise this right, the worker must produce complying evidence of their disability or satisfy the Director that such evidence was previously provided.

Linked to this re-referral right is the right to an extended limitation period under section 93EC. If the Director accepts a worker's referral under the new provisions, and the ordinary limitation period for commencing a common law action has expired or is set to expire within two years, the worker is granted a statutory right to commence their action at any time within two years from the day the Director notifies them of the acceptance.

For workers caught by the jurisdictional bar in section 7, the Act creates a statutory right to be paid reasonable legal costs incurred between 4 December 2003 and 25 October 2004 in relation to the annulled "former provisions matters". This is a direct right of recovery against the state's General Fund, bypassing the traditional rule that costs follow the event in dismissed litigation.

Correspondingly, the Act imposes strict administrative duties on public officials. Under sections 93EA(5) and 93EB(5), once a worker seeks to make a referral, the Director is under a mandatory statutory duty to notify both the worker and the employer, as soon as practicable, of whether the referral is accepted or rejected.

Furthermore, the Chief Executive Officer is under a duty to determine what constitutes "reasonable costs" for the purposes of the section 7 indemnity. If a worker disputes this determination, the Chief Executive Officer faces a mandatory duty under section 7(6) to refer the matter to a registrar of the District Court or a taxing officer of the Supreme Court for formal taxation.

Lastly, section 11 duties are imposed on the Commission, which is authorised to approve employer applications for reimbursement of excessive damages costs and charge those payments against the Employers' Indemnity Supplementation Fund.

Unlike standard regulatory statutes, the Workers’ Compensation (Common Law Proceedings) Act 2004 does not contain a regime of criminal offenses, pecuniary penalties, or regulatory fines. Instead, its enforcement mechanism is purely procedural, jurisdictional, and self-executing, relying on the total extinguishment of judicial power and the imposition of strict statutory bars.

The most severe enforcement tool in the Act is the jurisdictional bar set out in section 7(2). By stating that "no court may hear or determine a former provisions matter" on or after the commencement day, the legislature stripped the judiciary of its inherent and statutory jurisdiction over these cases. Any attempt by a party to bring or continue such an action is met with an absolute jurisdictional barrier.

This is reinforced by the self-executing dismissal mechanism in section 7(3). The Act does not require an employer to apply for a dismissal, nor does it require a judge to make an order. Instead, the statute itself declares these pending matters to be a "nullity" and deems them "dismissed by operation of this subsection". This represents an extraordinary use of legislative power to terminate active litigation without judicial intervention.

The enforcement of the timeline limitations in sections 93EA, 93EB, and 93EC is similarly absolute. If a worker fails to refer a question within the three-month window specified in sections 93EA(4)(b) or 93EB(4)(b), the Director has no statutory power to accept the referral. The right is permanently extinguished.

Likewise, the two-year limitation extension granted under section 93EC acts as a strict statutory bar. If a worker does not commence their common law action within two years of the notification day, their right to sue is lost, and an employer can raise the statutory limitation period as an absolute defense.

In terms of cost recovery, enforcement of the right to reasonable costs under section 7 is channeled through the established taxing machinery of the courts. Under section 7(6), if a worker disputes the CEO’s cost determination, the dispute is enforced and resolved "as if the determination were a taxation of costs" by a registrar of the District Court or a taxing officer of the Supreme Court. This imports the entire procedural apparatus of civil cost taxation to enforce the worker's right to reimbursement.

The Act is designed as a corrective overlay that deeply interacts with and modifies several other pieces of Western Australian legislation.

Its most significant interaction is with the Interpretation Act 1984 (WA). Section 5(2) and (3) of the Act explicitly state that their provisions apply "despite section 37 of the Interpretation Act 1984 and any other law, written or unwritten". Section 37 of the Interpretation Act 1984 contains the standard presumption that the repeal or amendment of a statute does not affect any accrued right, interest, title, power, or privilege acquired under the affected law. By deliberately overriding this provision, the Act successfully achieves its retrospective effect, stripping workers of vested rights to pursue common law damages under the old, more favorable rules that existed prior to the 1999 amendments.

The Act also acts as a direct amendment and procedural supplement to the Workers’ Compensation and Injury Management Act 1981 (which was renamed from the Workers' Compensation and Rehabilitation Act 1981 by amending Act No. 42 of 2004). It amends section 93E of the 1981 Act to insert subsection (6a), which integrates the new re-referral procedures with the existing election mechanisms. Under this integration, if a worker successfully navigates the new pathways under section 93EA or 93EB and receives notice of an accepted referral, they are granted a 14-day window under section 93E(6a) to make a formal election to seek common law damages once the agreement or determination of their disability is recorded.

Furthermore, the Act modifies the operation of section 93D of the 1981 Act. Sections 93EA and 93EB are specifically designed to cure procedural and evidentiary defects that arose under section 93D(5) and (6) of the 1981 Act. By providing a statutory second chance to refer questions that were previously dismissed due to strict adherence to section 93D(6) evidentiary rules, the Act temporarily relaxes the finality of the 1981 Act’s evaluation regime.

Finally, the Act interacts with the Employers’ Indemnity Supplementation Fund Act 1980 (WA). Section 12 of the Act amends section 10(fa) of the 1980 Act to permit the payment of moneys out of the Supplementation Fund to cover the costs of employer reimbursements approved under the newly inserted section 154AC of the 1981 Act. This creates a direct financial bridge between the state-managed indemnity fund and the revived common law liabilities under the workers' compensation regime.

The Workers’ Compensation (Common Law Proceedings) Act 2004 is a historical statute with a brief but critical amendment profile.

The Bill was introduced into the Western Australian Parliament in 2004 and was enacted as Act No. 35 of 2004. It received the Royal Assent on 25 October 2004. Upon its enactment, the commencement of the Act was split. Under section 2(2), sections 5(1) and 5(2) were deemed to have come into operation retrospectively on 5 October 1999, aligning them with the immediate aftermath of the 1999 amendment Act. The remainder of the Act commenced on the assent day, 25 October 2004.

Shortly after its enactment, the Act was amended by the Workers’ Compensation Reform Act 2004 (Act No. 42 of 2004). Section 173 of the Reform Act, which was assented to on 9 November 2004 and came into operation on 4 January 2005 (as per the proclamation published in the Government Gazette on 31 December 2004, page 7131), made several consequential amendments.

These amendments primarily updated the terminology of the Act to reflect the broader structural reforms occurring in the Western Australian workers' compensation system. Specifically:

• Section 173(2) amended sections 3(b), 4(2), and 6(2)(c) by deleting references to the "Workers’ Compensation and Rehabilitation Act 1981" and replacing them with the renamed title, "Workers’ Compensation and Injury Management Act 1981".
• Section 173(3) and (4) amended section 7 of the Act. Section 173(3) updated the cost recovery provisions in section 7(4) by ensuring that the term "General Fund" was correctly applied. Section 173(4) amended section 7(7) to clarify that the costs payable under the section were to be charged specifically against the General Fund, aligning the administrative cost-shifting mechanism with the financial structures of the newly reformed regulatory body (WorkCover WA).

Since the commencement of the 2004 reform amendments, the Act has remained unamended, serving as a transitional static instrument.

While the text of the Act does not explicitly list the names of specific parties to lawsuits, the entire statute is an explicit legislative intervention designed to resolve the fallout from specific litigation in the Supreme Court of Western Australia.

Section 3(b) declares that a core purpose of the Act is to ensure that workers are not disadvantaged by "the effect of certain decisions of the Supreme Court in relation to the operation of section 93D of the Workers’ Compensation and Injury Management Act 1981". This is an acknowledgment of a scenario where judicial interpretation of the 1981 Act deviated from parliamentary intent, prompting a legislative override. The Supreme Court had strictly interpreted the evidentiary requirements under section 93D(6), leading to situations where workers’ attempts to refer disability questions were thrown out on hyper-technical grounds, such as failing to produce the precise form of medical evidence required at the exact moment of referral.

The litigation history is also visible in the structure of sections 93EA and 93EB. Section 93EA(1)(b) directly addresses cases where "a review officer did not deal with the substance of the question" or "a court set aside or quashed a decision of a review officer" due to a failure to satisfy the strict requirements of section 93D(6). Similarly, section 93EB(1)(b) targets litigation where, on or after 4 December 2003, review officers or courts set aside decisions because they mistakenly applied the pre-1999 "former provisions" rather than the "amended provisions" to the awarding of damages.

The most concrete piece of litigation history preserved in the text is found in sections 5(3)(d) and 7(1). Both provisions explicitly carve out "District Court file number WC 93D 1194/1998". By exempting this specific file from the definition of a "former provisions matter" under section 7(1) and saving it from the retrospective application of the amended provisions under section 5(3), the legislature insulated this specific piece of active litigation from the statutory nullification and jurisdictional bars imposed on all other legacy cases. This indicates that this particular case had progressed to a stage where legislative interference was deemed inequitable or legally inappropriate.

For legal practitioners and compliance officers, this Act contains several dangerous procedural traps, or "gotchas", that can easily result in the permanent loss of a client's rights or unexpected financial liability.

The first major trap is the retrospective operation of section 5. Because section 5(1) and (2) are backdated to 5 October 1999, transactions, settlements, or litigation strategies executed years prior to the 2004 Act's passage must be evaluated under this retrospective lens. Practitioners cannot rely on the standard presumption against retrospectivity; they must accept that the stricter common law thresholds applied to their clients' cases from 1999 onward, unless they fall squarely within the narrow exemptions of section 5(3).

The second trap is the incredibly tight three-month limitation window for re-referring questions under sections 93EA(4)(b) and 93EB(4)(b). To access the remedial gateway, the worker’s legal representative had to file the referral in the specified regulatory form within three months of the commencement of section 10, or within three months of a court setting aside a relevant decision. Because this is a strict statutory limit, the Director has no general discretion to extend the time for filing. Missing this three-month deadline by even a single day resulted in the absolute extinguishment of the worker's revived common law pathway.

The third trap relates to the 16% disability threshold restriction under sections 93EA(2) and 93EB(2). The right to re-refer a question does not apply if the question is whether the worker’s degree of disability is not less than 16%, unless the original, defective referral occurred at least 21 days before the "termination day" (or a day fixed by the Director). This means that workers who were dilatory in making their original referrals are completely barred from using these remedial provisions to access the lower common law threshold.

The fourth trap is the self-executing nullity in section 7(3). Legal practitioners who continued to spend time and resources preparing legacy applications after 25 October 2004 would find that their cases had already been dismissed by operation of law, with no judicial order required. Furthermore, the cost indemnity in section 7(4) is strictly capped, covering only reasonable costs incurred between 4 December 2003 and 25 October 2004. Any costs incurred outside this window are entirely unrecoverable, representing a significant financial risk for law firms operating on conditional fee agreements.

Finally, the 14-day election window under section 93E(6a) is exceptionally short. Once the Director provides written notice that an agreement or determination of the disability question has been recorded, the worker has only 14 days to make a formal election to seek common law damages. Failure to file the election within this fortnight permanently bars the worker from proceeding to court, rendering the entire re-referral process useless.

To ensure compliance with the Workers’ Compensation (Common Law Proceedings) Act 2004, legal practitioners, insurers, and administrators must adopt systematic procedural checklists.

For Plaintiff Legal Practitioners:

1. Identify Eligible Historical Files: Review archived and active workers' compensation files from the 1999 to 2004 transitional period. Specifically search for clients who attempted referrals before 30 September 2001 but faced technical dismissals.
2. Verify the 21-Day Rule: Before attempting a re-referral regarding a 16% disability threshold, verify that the original defective referral was lodged at least 21 days prior to the statutory termination day (s 93EA(2), s 93EB(2)).
3. Execute Re-referrals in Form: Draft and submit any re-referral in the precise written form specified in the regulations, explicitly stating that the worker is acting under section 93EA(3) or 93EB(3) (s 93EA(4)(a), s 93EB(4)(a)).
4. Produce Compliant Evidence: At the time of re-referral, physically produce medical evidence that strictly complies with section 93D(6) of the 1981 Act, or compile clear documentary proof to satisfy the Director that complying evidence was previously provided (s 93EA(4)(c)).
5. Monitor the 14-Day Election Window: Set strict internal calendar alerts for the 14-day election period under section 93E(6a). Once the Director issues written notice of the recorded determination, immediately file the worker’s formal election to seek common law damages.
6. Track the 2-Year Limitation Extension: Ensure that any common law writ for damages is issued and served within two years of the "notification day" on which the Director accepted the referral (s 93EC). Do not rely on general limitation statutes.
7. Submit Indemnity Claims: For any active proceeding annulled by section 7(3), compile a detailed itemised bill of costs for the period between 4 December 2003 and 25 October 2004. Submit this to the Chief Executive Officer for a determination of "reasonable costs" (s 7(5)). If the determination is inadequate, file a dispute to refer the matter to a District Court registrar or Supreme Court taxing officer within the permitted civil procedure timeframes (s 7(6)).

For Insurers and Claims Managers:

1. Audit Open Common Law Claims: Review active common law claims to identify if any are based on revived referrals under sections 93EA or 93EB.
2. Apply for Supplementation Fund Subsidies: Where an award of damages is made against an insured employer arising from a section 93EA(3) referral, calculate whether the total cost of the damages exceeds the threshold set by the regulations. If it does, immediately lodge a formal application with the Commission for reimbursement under section 154AC of the 1981 Act, ensuring all supporting payment records are attached to claim against the Employers’ Indemnity Supplementation Fund.

For Government Administrators (WorkCover WA):

1. Establish Processing Protocols: Maintain administrative protocols to ensure that when a worker lodges a referral under section 93EA or 93EB, the Director evaluates the compliance of the evidence and issues the mandatory acceptance or rejection notice to both the worker and employer "as soon as practicable" (s 93EA(5), s 93EB(5)).
2. Formulate Cost Assessment Guidelines: Establish objective administrative criteria for the Chief Executive Officer to assess "reasonable costs" under section 7(5), reducing the administrative burden and legal friction of referring cost disputes to court taxing officers.