Amos v RCR Tomlinson Ltd - [2011] WADC 85

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION: PERTH

CITATION: AMOS -v- RCR TOMLINSON LTD [2011] WADC 85

CORAM: PRINCIPAL REGISTRAR GETHING

HEARD: 11 & 27 MAY 2011

DELIVERED : 3 JUNE 2011

FILE NO/S: CIVO 1143 of 2011

BETWEEN: ROBERT AMOS
Applicant
AND
RCR TOMLINSON LTD
Respondent

Catchwords:

Civil judgment - Enforcement - Issue estoppel - Workers compensation - Memorandum of agreement

Legislation:

Civil Judgments Enforcement Act 2004 (WA), s 59, s 59(1)
Health and Other Services (Compensation) Act 1995, s 33B
Workers’ Compensation and Injury Management Act 1981 (WA), s 67(2), s 76, s 76(1), s 219(1),s 219(3), pt XI

Result:

Application dismissed

Representation:

Counsel:

Applicant: In person
Respondent: Ms R Aria Retnam & Ms S M Costopolous

Solicitors:

Applicant: Not applicable
Respondent: RCR Tomlinson Ltd

Case(s) referred to in judgment(s):

Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853
Kuligowski v Metrobus [2004] HCA 34; (2004) 220 CLR 363
Nosow v St Anne's Hospital (Unreported, WASCA, Library No 5548, 9 October 1984)
Ramsay v Pigram (1968) 118 CLR 271

PRINCIPAL REGISTRAR GETHING: This decision relates to an application by the judgment creditor, Mr Robert Amos, for the court to issue a Property (Seizure and Sale) Order (PSSO) against the judgment debtor, RCR Tomlinson Ltd (RCR). The judgment debt sought to be enforced arises out of a Memorandum of Agreement (MOA) between Mr Amos and RCR dated 19 November 2009 pursuant to Workers' Compensation and Injury Management Act 1981 (WA) (WCIMA) s 67(2) and s 76. Mr Amos claims that RCR has not paid all the moneys that it was obliged to pay pursuant to the MOA. RCR asserts that all money due under the MOA has been paid and that no PSSO should issue.

Procedural history

The MOA was registered pursuant to WCIMA s 76. WCIMA s 76(1) provides that a 'memorandum shall for all purposes be enforceable as an award or order made by an arbitrator'. WCIMA s 219(1) provides that the decision of an arbitrator may be enforced:
[B]y filing in a court of competent jurisdiction
(a)a copy of the decision that the Director has certified to be a true copy; and
(b)an affidavit as to the amount not paid under the decision.
On filing, 'the decision is to be taken to be an order of that court, and may be enforced accordingly': WCIMA s 219(3). Mr Amos filed a certified copy of the MOA with the court, along with an affidavit as to the amount said to remain outstanding under the MOA. Accordingly, the MOA is enforceable as an order of the District Court.
The power to issue a PSSO to enforce an order of the court is contained in Civil Judgments Enforcement Act 2004 (WA) s 59. Section 59(1) provides that the court 'may' make such an order. The court thus has a discretion as to whether or not to make a PSSO.
The application for the PSSO was dated 6 April 2011. The amount said to be outstanding in the application was $58,899.24. It was supported by an affidavit dated 28 February 2011 sworn by Mr Amos.
When the application was reviewed by the court, it was not clear on what basis this amount was due, given that the amount of the lump sum settlement in the MOA was $25,000. Accordingly, I directed that the application be listed in chambers for directions.
The matter came on before me for directions on 6 April 2011. At that hearing I was not satisfied that the amount said to be the judgment debt was due and payable. I ordered Mr Amos to serve a copy of the application on RCR, set a timetable for the filing of further affidavits and listed the matter for further directions on 11 May 2011. RCR filed an affidavit of Lauren Haygarth, dated 28 April 2011, in opposition to the application, and filed submission on the same date. Mr Amos did not file any further affidavits. When the matter came on for hearing on 11 May 2011 the parties were in a position to argue the application and so it proceeded for hearing.
At the commencement of her submissions, counsel for RCR sought to tender a second affidavit, being an affidavit of Sandra Costopolous sworn 9 May 2011. Mr Amos said he had not been served with the affidavit and objected to it being used for the hearing. In response to this objection, counsel for RCR said that RCR would not seek to rely on it for the purposes of the application before me. I then stated that I would not rely on it for the purposes of the application.
In a subsequent email, Mr Amos requested that I take Ms Costopolous' affidavit into account as it contained what he described as 'highly relevant' material. I wrote to the parties and said that, in response to this request, I would take the affidavit into account in my decision, but would allow the parties a short opportunity to make further written submissions.
Mr Amos then sent in written submissions about the affidavit. On reading the submissions, I formed the view that it was appropriate that I convene a further hearing. This hearing was held on 27 May 2011. Mr Amos appeared and Ms Costopolous appeared for the judgment debtor. I heard submissions from both of them.

The terms of the MOA

The MOA recites that Mr Amos sustained an injury on 19 March 2008 arising out of, or in the course of, his employment. The injury recorded was 'a left foot, left knee and possibly left ankle, hip back and psychiatric/psychological'. His weekly earnings as at the date of the accident are recorded as being $836.
Pursuant to the MOA, Mr Amos' claims under the WCIMA were finalised and RCR agreed to pay, and Mr Amos agreed to accept, $25,000 on the terms and conditions set out in the MOA. The MOA recorded that Mr Amos had received $26,250.40 by way of weekly payments and $14,604.90 by way of statutory expenses. The lump sum of $25,000 was said to be 'by way of redemption of liability to make future weekly payments as for permanent partial incapacity' (cl 5(ii)).
Clause 6, cl 7, cl 8 and cl 9 provide:
6.The employer warrants that to the date of this Agreement it has paid all compensation due to the worker and all expenses in respect of the matters contained in the Workers' Compensation and Injury Management Act 1981 Schedule 1 clauses 9, 10, 17, 18, 18A and 19 (which includes medical and travelling) and, to the extent that these have not been paid, undertakes to pay them.
7.The worker is aware of expenses due but unpaid in respect of the matters contained in the Workers' Compensation and Injury Management Act 1981 Schedule 1 clauses 9, 10, 17, 18, 18A and 19 but accepts those expenses as part of the settlement agreed.
8.The worker hereby releases and forever discharges the employer from all claims and demands which the worker now had or, but for the execution of this agreement, could or might have had against the employer under the Act in any respect to the disability to the worker referred to in this Agreement.
9.The employer hereby releases and forever discharges the worker from all claims and demands which the employer now had or, but for the execution of this agreement, could or might have had against the worker under the Act in any respect to the disability to the worker referred to in this Agreement.

Decision of Commissioner McCann

After the MOA was signed (19 November 2009), but before it was registered (16 March 2010), Mr Amos filed an application pursuant to WCIMA pt XI in which he claimed an order for payment of weekly arrears from 27 March 2008 to the date of that application and ongoing. RCR filed a reply in which it denied that there was any entitlement to weekly payments on the ground that Mr Amos had failed to prove that he suffered from any incapacity.
Upon registration of the MOA, the issue arose as to whether the Dispute Resolution Directorate of WorkCover had jurisdiction to continue the pt XI proceedings in view of the registration of the MOA. Another issue that arose was whether RCR was entitled to deduct 10% from the amount of the lump sum when paying Mr Amos. This amount was paid by RCR to Medicare Australia. The arbitrator ruled in favour of RCR, dismissed the pt XI application and refused to order RCR to pay the remaining 10%.
Mr Amos appealed to the commissioner. A copy of the commissioner's reasons is annexed to Ms Haygarth's affidavit. In relation to the deduction of the 10% (ground 1 of the appeal) the commissioner found as follows:
Mr Amos submits that the arbitrator erred by refusing to order the employer to pay the outstanding 10% of the settlement sum. I do not accept that contention, since the arbitrator lacked jurisdiction to make an enforcement order. Pursuant to s76(1) of the Act, upon registration a Memorandum of Agreement is deemed 'for all purposes [to] be enforceable as an award or order made by the arbitrator'. Pursuant to s219(1) of the Act an order of the arbitrator is enforceable in a court of competent jurisdiction. So, Mr Amos must pursue his remedy for non‑compliance with the Agreement (if any) in the appropriate court. [26]
Further, in my view, the arbitrator's reasons (or explanation) for the employer remitting 10% of the settlement sum to the Health Insurance Commission are reasonable. [27]
There is no merit in ground (1) and leave to appeal is refused. [28]
The other relevant ground of appeal is ground 3. In determining this ground the commissioner addressed the issue of whether there are any amounts due but not paid for the purposes of cl 6. It is appropriate that I quote the full text of the commissioner's decision in relation to this ground. The reference in the quote to Nosow is to the decision in Nosow v St Anne's Hospital (Unreported, WASCA, Library No 5548, 9 October 1984):
This ground raises issues as to the legal effect of a Memorandum of Agreement when it is signed and when it is registered, and as to the construction of the Agreement and in particular clause 8. [30]
I commence by addressing Nosow, which concerned the legal effect of a Memorandum of Agreement (in similar terms to the Agreement in this case) in relation to the work's entitlement to weekly payments (if any) after the date of the agreement. In their judgments But CJ (with whom Smith J agreed) and Wallace J referred to the legislative scheme, which was similar but not identical to the present scheme, and held that, whilst an agreement is not legally enforceable until it is registered, once that occurs it becomes enforceable as an award or order and operates in accordance with its terms as and from the date of its making (in the same way as any other agreement would do). [31]
I am not satisfied that the arbitrator mis‑construed or mis‑applied Nosow in any way. In his reasons (paragraph 5) he dealt with that case by setting out, and agreeing with, Prof Guthrie's summary in his text entitled 'Workers' Compensation in Western Australia'. In my opinion Prof Guthrie's summary is accurate and the arbitrator was correct to agree with it. In his submissions in the application for leave to appeal Mr Amos submitted that the arbitrator's reasons 'betray an obvious lie,' and that the arbitrator only read the summary in Guthrie, and not the case, because he has repeated a mis‑print in the 1995 text. I do not accept that submission, because a full copy of the unreported decision is on the DRD file, the arbitrator merely quoted from Guthrie and in any event, as I have said, he correctly directed himself as to the effect of Nosow. [32]
As I understand it, Mr Amos next submits that the arbitrator's construction of clause 8 of the Agreement was wrong in so far as he held that it effected a release and discharge of the employer both retrospectively and prospectively. That issue did not directly arise in Nosow and falls to be considered on the construction of clause 8 having regard to the principles of contractual interpretation, pursuant to which the objectively proven factual and legal matrix is admissible, not to contradict or vary the agreement, but as evidence of the facts and circumstances which the parties had in mind and, objectively, the purpose of the agreement. (See Codelfa Construction Pty Ltd v State Rail Authority of NSW (1982) 149 CLR 337). In my opinion the purpose of the Agreement in this case was the redemption, settlement and finalisation of Mr Amos' compensation entitlements. [33]
I begin my reasons by noting that the settlement sum is described in clause 5(a)(ii) as being a redemption of the employer's liability to make future weekly payments. Based on that provision it might be contended that the purpose of the Agreement was limited to Mr Amos' future entitlements to weekly payments. That construction would, of course, suffice to dispose of some of his claim, but it would preserve his claim for arrears of weekly payments up to 19 November 2009. [34]
However, I am not satisfied that the description of the consideration in terms of a redemption of future liability is decisive as to the construction of the Agreement. My reasons are as follows:
(i)Pursuant to s67(5) of the Act, the registration of an Agreement for the redemption of a liability for incapacity brings an end to all or any entitlement to compensation (see Kennedy v Brodun Constructions Pty Ltd [2008] C280-2008). The purpose of a redemption is to attain finality and that is part of the matrix of circumstances in which the purpose of the Agreement must be ascertained.
(ii)The preamble, which is actually one of the operative provisions of the Agreement, states that the 'worker's claims referred to in this Agreement are finalised'. The word 'claims' only appears in two other places in the Agreement, namely in the releases and discharges comprised in clauses 8 and 9. In my opinion it connotes the entirety of the right to compensation under the Act and is not limited to a claim in the sense of a demand or a proceeding for relief under Part XI of the Act. Mr Amos' 'claim' was his right to compensation in respect of his accident on 19 March 2008.
(iii)Directing attention to clause 6, it is important to note that the warranty is limited to 'compensation due to the worker' which remains unpaid. That warranty, which is consistent with ss 67(5) and 76(3), reflects the fact that a worker is entitled to continue to receive compensation entitlements which have legally crystallised up to and including redemption. But, in this case there was a dispute as to whether any payments were 'due' and clause 6 cannot be construed as a promise by the employer to pay any disputed arrears.
(iv)Turning to clause 8, it is to be noted that the release applies to 'all claims and demands which the worker now had' or, but for the execution of the Agreement, could or might have had against the employer under the Act. In my opinion the words 'now had' support a construction which extends the release to existing or pending entitlements, and demands in respect of the same, and has a retrospective effect. Indeed, it could be said that the release could only have retrospective effect having regard to the prospective nature of the covenant in clause 5.
(v)It is to be noted that the terminology in clause 9 is similar to clause 8. In clause 9 the employer releases and discharges the worker from any liability which he 'had' or 'could or might have had' under the Act, which would apply to a claim for a refund of compensation under s 71. So, clause 9 is intended to apply retrospectively. A retrospective operation for clause 8 would ensure that there is mutuality of the releases and discharges. [35]
For these reasons I am satisfied that, on the true construction of the Agreement as a whole, it is intended to effect a release and discharge of claims to or about compensation, including the employer's liability for all and any arrears and future payments. Accordingly, I uphold the arbitrator's construction of the Agreement. [36]
It is relevant to take into account that the Agreement is substantially in a standard form which is prescribed by regulation 12(1a) of the Workers' Compensation and Injury Management Regulations for the purposes of s76 of the Act. I say 'substantially' because clause 9 is not part of the prescribed form. This departure is of no consequence since clause 9 operates for the benefit of the worker. This form of agreement has served the workers' compensation jurisdiction for many years and the construction adopted by the arbitrator is consistent with that which has been followed. A court should be careful before interfering with a construction which has been given to a well-known form of agreement and acted on for a considerable period of time (see Federation Insurance Ltd v Banks [1984] VR 525 at 534 per Kaye J). [37]
Finally, I should add that I am satisfied that the release and discharge in clause 8 is supported by valuable consideration. Mr Amos' Part XI application was opposed in its entirety. The fact that the redemption is expressed to be for future entitlements does not preclude the employer's covenant to pay it from being adequate and sufficient consideration for the retrospective discharge. [38]
For these reasons ground (3) fails and leave to appeal is refused. [39]

Payments pursuant to the MOA

Ms Haygarth deposes that RCR, through its insurer, paid Mr Amos $22,500 (par 15). The remaining $2,500 was forwarded by RCR, again through its insurer, to Medicare Australia.
At the hearing on 11 May 2011, Mr Amos confirmed that he had received an amount of $2,500 from Medicare Australia.
There are two bases on which Mr Amos claims further amounts. The first is that as RCR has not paid him the remaining $2,500, it has not satisfied the judgment debt. The second is that there are arrears of weekly payments which are due and may be recovered pursuant to cl 6. Each is dealt with below.

Underpayment by 10%

The amount of $2,500 not paid to Mr Amos was paid to Medicare Australia. The obligation on an insurer to deduct 10% of a judgment and forward it to Medicare is set out in Health and Other Services (Compensation) Act 1995 s 33B, as follows:
(1)A compensation payer or insurer may make an advance payment to the Commonwealth in respect of the compensation payable under a judgment or settlement if:
(a)during the 6 months preceding the day on which an amount of compensation was fixed under the judgment or settlement, a notice under section 21 had not been given; and
(b)a notice under section 23 has been given indicating that the compensation payer or insurer intends to make an advance payment; and
(c)a notice under section 33A has been given; and
(d)the amount of the compensation payable under the judgment or settlement is not a small amount.
Note: For small amount see section 38.
(2)The advance payment must be an amount equal to 10%, or such other percentage as the Minister determines, of the amount of compensation payable under the judgment or settlement.
(2A)A determination under subsection (2) may:
(a)identify different amounts, or ranges of amounts, of compensation payable; and
(b)set different percentages for any one or more of those amounts, or ranges of amounts.
(3)The advance payment must be made:
(a)if the judgment or settlement was made after the commencement of this Division within 28 days after the judgment or settlement was made; or
(b)if the judgment or settlement was made before that within 28 days after that commencement.
(4)Determinations made under paragraph (1)(d) and subsection (2) are disallowable instruments for the purposes of section 46A of the Acts Interpretation Act 1901.
In the present case, the insurer of RCR was required to pay the advance payment pursuant to s 33B. Mr Amos subsequently received the advance payment from Medicare Australia without deduction. An order for further enforcement of the MOA in this regard would lead to Mr Amos ultimately receiving the $2,500 twice. I am satisfied that RCR has complied with the terms of the MOA in this regard and there is therefore no basis for the making of a PSSO.

Arrears of weekly payments

In his affidavit, Mr Amos claims unpaid compensation totalling $54,575.70. The relevant parts of his affidavit are pars 1 ‑ 4, which are as follows:
1.I am the above named claimant (judgment creditor).
2.That on the 16 Day of March 2010 the judgment creditor obtained an Order the subject matter of which is contained in a Memorandum of Agreement against the abovementioned Defendant (judgment debtor) for payment of a lump sum of $25,000 and for unpaid compensation totalling [sic] $52,075.70.
3.That there is still due on the said order the sum of $54,575.70.
4.I apply for the issue of a court order against RCR Tomlinson Ltd (judgment debtor) in respect of the nonpayment of the sum of $54,575.70.
The basis on which Mr Amos claims the $54,575.70 is not set out in his affidavit. From the submissions made in court before me, as I understand it, his argument is as follows:
(a)the MOA provides that if there is compensation which is due to him as at the date of the agreement, but which has not yet been paid, the employer is required to pay it under the MOA cl 6;
(b)there is no dispute that he was injured for the purpose of the workers compensation regime as this is recorded on the face of the MOA and the employer, by cl 9, releases the worker for any claims or demands to the contrary, except for those under the MOA;
(c)he was injured on 19 March 2008 and the MOA was signed on 19 November 2009, making a total of 611 days (or 87.14 weeks) which he was not able to work;
(d)he is entitled at least to be paid the weekly wage he would otherwise have received for this 87.14 week period, at the amount of $836.00, again as recorded in the MOA;
(e)multiplying 87.14 by 611 weeks, there is an entitlement of compensation in the amount of $53,244;
(f)amounts for holiday loadings need to be added to the amount in par (f);
(g)from the total of the amounts in par (e) and par (f), the amount of weekly payments actually made needs to be deducted, being $26,250;
(g)the resulting amount is the amount of $54,575.70, which is an amount due to him for the purposes of cl 6.
The court must give effect to the MOA as if it were an order of the court. If there is to be any further amounts payable over and above the $25,000, they must be payable pursuant to cl 6. The key question for the purposes of cl 6 is whether there is any compensation due Mr Amos which has not yet been paid.
In my view there is not. This is for two reasons.
The first reason is that I am bound to follow the decision of the commissioner as a result of the doctrine of issue estoppel. This doctrine prevents a party litigating an issue that has already been decided in earlier proceedings as between the same parties. The doctrine was explained by Barwick CJ in the following terms in Ramsay v Pigram (1968) 118 CLR 271, 276:
Longstanding authorities, in my opinion, warrant the statement that, as a mechanism in the process of accumulating material for the determination of issues in a proceeding between parties, an estoppel is available to prevent the assertion in those proceedings of a matter of fact or of law in a sense contrary to that in which that precise matter has already been necessarily and directly decided by a competent tribunal in resolving rights or obligations between the same parties in the same respective interests or capacities, or between a privy of each, or between one of them and a privy of the other in each instance in the same interest or capacity. The issue thus determined, as distinct from the cause of action in relation to which it arose, must have been identical in each case.
This passage was cited with approval by the High Court in Kuligowski v Metrobus [2004] HCA 34; (2004) 220 CLR 363, [40]. In that decision, the High Court held that a decision of a WorkCover review officer could create an issue estoppel which bound a District Court judge: [22]. By parity of reasoning, an issue estoppel could arise from a decision of the commissioner.
Three conditions must be satisfied in order for an issue estoppel to arise:
(a)the same question has been decided in earlier proceedings;
(b)the judicial decision which is said to create the estoppel must be final;
(c)the parties to the earlier judicial proceeding or their privies are the same persons as the parties to the proceedings in which the estoppel is raised.
See Carl Zeiss Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853, 935; Kuligowski [21].
The relevant question is whether there is any further amount of compensation due to Mr Amos in the light of the execution of the MOA. This was decided in the negative by the commissioner. The commissioner's decision was a final decision in the sense that it is 'completely effective unless and until rescinded, altered or amended': Kuligowski [25]. The parties to the earlier decision were the same, Mr Amos and RCR.
Mr Amos submitted that the commissioner did not have jurisdiction to make a decision on the issue of whether there were any amounts outstanding as the registration of the MOA brought to an end the jurisdiction of the arbitrator and thus the commissioner. The commissioner had determined in relation to the issue of the 10% deducted for Medicare Australia that the arbitrator did not have jurisdiction given the registration of MOA (par 26, quoted above). In effect, Mr Amos submitted that the commissioner should have come to the same decision in relation to this issue of whether there were further amounts due pursuant to the MOA.
In my view, there is a conceptual difference between the issue of whether the 10% paid to Medicare ought to have been paid by RCR to Mr Amos and the issue of whether there were any amounts still due by RCR. The issue in the former was whether the arbitrator ought to make an enforcement order to compel RCR to pay the remaining 10% of the settlement sum. The commissioner's decision was that enforcement orders are the province of a court of competent jurisdiction (par 26). The latter issue raised a question of law, namely the construction of the MOA, including as to whether there were any further amounts due.
On this basis, the decision of the commissioner in relation to the construction of the MOA was within his Honour's jurisdiction.
In my view an issue estoppel arises from the decision of the commissioner as to whether there is any further amount of compensation due to Mr Amos in the light of the execution of the MOA.
The second reason is that even if I am not bound by the commissioner's decision on this point, I would come to the same conclusion as the commissioner for the reasons he expresses.
It appears from the material before me that by WCIMA Form 3A dated 2 April 2008, RCR through its insurer accepted the liability to pay weekly payments. (There is an issue as to when this Form was served on Mr Amos, but in my view nothing turns on it.) At some later stage, it appears that RCR stopped paying weekly payments. As already noted, after the MOA was signed, Mr Amos filed an application pursuant to WCIMA pt XI claiming payment of the arrears of the weekly payments. At the time the MOA was executed, there was either:
(a)an acceptance by Mr Amos that no further arrears of weekly compensation were due and payable, a position he subsequently resiled from when commencing the pt XI proceedings; or
(b)a dispute between Mr Amos and RCR as to whether or not further arrears of weekly compensation were due able payable.
In either case, there was no right to weekly payments established by Mr Amos such that it could be said that they are 'due' to him for the purposes of cl 6. To the extent that Mr Amos had a claim for further weekly payments, this is one of the claims that he released RCR from pursuant to cl 9. To use the words of the commissioner, there was no 'legally crystallised' entitlement to weekly compensation (par 35(iii)).
The MOA on its face is a compromise of all disputes relating to workers compensation arising between Mr Amos and RCR as a result of the accident recorded in the MOA. This court must give effect to the MOA.

Decision

For the reasons set out above, I am of the view that there is no money due and payable to Mr Amos pursuant to the MOA and that it is thus not appropriate for the court to issue the PSSO. The application to issue a PSSO will be dismissed and I will hear from the parties in relation to costs. My preliminary view is that if there is a costs order I should fix the costs pursuant to the Supreme Court's Consolidated Practice Direction Part 4.7.