Accident Compensation Commission v Commonwealth of Australia

The Accident Compensation Commission (ACC) sought special leave to appeal to the High Court of Australia against the Commonwealth of Australia. The dispute concerned the interpretation of section 162 of the *Social Security Act* and its interaction with section 97(5) of the *Accident Compensation Act*.

The central legal issue was whether a notice issued under the *Social Security Act*, which operated similarly to an assignment, could validly attach payments made under the *Accident Compensation Act*. The ACC argued that workers' compensation payments, including those under the *Accident Compensation Act*, were inalienable by statute and common law across various Australian jurisdictions. This inalienability, it was contended, meant that any purported assignment, such as that effected by a notice under the *Social Security Act*, would be subject to existing defects in title, including the statutory prohibition against alienation.

The ACC relied on the principle established in *Clyne v Deputy Commissioner of Taxation* (1981) 150 CLR 1, which held that an assignee of a chose in action takes it subject to all equities, infirmities, and defects in title of the assignor. Applying this to the present case, the ACC argued that since a worker could not alienate their workers' compensation payments, a notice under the *Social Security Act* could not create a valid assignment of such payments. The Court was invited to consider the effect of such a notice as akin to a garnishee order, which is subject to defences and set-offs available to the debtor.