BCP v Secretary (Department of Communities and Justice) & Ors

CERTIFICATE OF DETERMINATION OF MEMBER
Citation:	BCP v Secretary (Department of Communities and Justice) & Ors [2022] NSWPIC 615
APPLICANT:	BCP
FIRST RESPONDENT:	Secretary, Department of Communities and Justice
SECOND RESPONDENT	BKB
THIRD RESPONDENT	BHC
SENIOR Member:	Kerry Haddock
DATE OF DECISION:	4 November 2022
CATCHWORDS:	WORKERS COMPENSATION - Claim for interest on lump sum death benefit pursuant to section 109 of the Workplace Injury Management and Workers Compensation Act 1998; claim opposed by first respondent; orders for apportionment of lump sum and direction for written submissions on issue of interest made at preliminary conference; consideration of Bennett v Jones, Beves v Patrick Stevedores No 2 Pty Ltd & Anor, Haidary v Wandella PetFoods Pty Ltd, Kaur v Thales Underwater Systems Pty Ltd, Pheeney v Doolan (No 2) and Kathryn Ann Kratz as executrix of the estate of the late Owen Beddall v Qantas Airways Limited; Held – award of interest from the date the claim was “duly made” at a rate 2% above the Reserve Bank of Australia cash rate, apportioned in the same proportions as the lump sum; interest payable to the second and third respondents to be paid to the NSW Trustee and Guardian.
determinations made:	The Commission determines: 1. The first respondent is to pay interest on the lump sum of $834,200, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, apportioned in the same proportions as the lump sum, as follows: (a) from 18 August 2022 to 6 September 2022 at 3.85% per annum; (b) from 7 September 2022 to 4 October 2022 at 4.35% per annum; (c) from 5 October 2022 to 1 November 2022 at 4.6% per annum, and (d) from 2 November 2022 to 3 November 2022 at 4.85% per annum. 2. The interest payable to the second and third respondents is to be paid to the NSW Trustee and Guardian.

STATEMENT OF REASONS

BACKGROUND

The worker, BHC (BHC) died on 11 January 2021 as a result of injuries arising out of or in the course of his employment with the first respondent, Secretary, Department of Communities and Justice.
The applicant, BCP, is BHC’s widow. The second and third respondents, BKB and BHC, respectively, are the children of the marriage. I will refer to them by their given names, to avoid confusion, while meaning no disrespect to them.

It is not clear when the claim was made, but BCP has made a claim for payment of the lump sum death benefit, pursuant to s 25 of the Workers Compensation Act 1987 (the 1987 Act).
By letter dated 9 March 2022, the solicitors for the first respondent’s workers compensation insurer, QBE Insurance (Australia) Ltd (QBE), advised the applicant’s solicitors that liability for her claim had been accepted. They requested that BCP’s solicitors obtain instructions to file an Application in Respect of Death of Worker (the Application). They would then file a Reply, allowing for the matter to be listed for teleconference, and for findings of injury, death, and the payment of the death benefit.
The Application was registered on 18 August 2022. It named BKB as the second respondent and BHC as the third respondent. It was served on the first respondent on 19 August 2022.
The Application claimed lump sum compensation of $834,520; weekly payments for BKB and BHC; and interest on the lump sum.
The first respondent lodged its Reply on 26 August 2022.
The second respondent lodged her Reply on 5 September 2022.
On 5 September 2022, the applicant lodged an Application to Admit Late Documents, amending her submissions on apportionment and interest, as the lump sum claimed was incorrect, the correct amount being $834,200.
The third respondent lodged her Reply on 6 September 2022.

ISSUES FOR DETERMINATION

The following issue remains in dispute:
(a) whether the applicant, the second respondent, and the third respondent are entitled to payment of interest on the lump sum death benefit, and, if so, the period during which interest is to be paid, and the rate/s at which it is to be paid.

PROCEDURE BEFORE THE PERSONAL INJURY COMMISSION (the Commission)

The matter was listed for preliminary conference on 21 September 2022. Ms Sutcliffe appeared for the applicant, who was present. Ms Jan appeared for the first respondent; Mr Allan appeared for the second respondent; and Ms Kakala appeared for the third respondent. Ms Balks attended as “tutor” for BKB, and Ms Hawkins attended as “tutor” for BHC. Ms Sandona of QBE also attended.
The Application was amended to delete the claim for $834,520 and insert a claim for $834,200.
The dependants had agreed on a proposed apportionment of the lump sum. The appropriate findings were made, and the lump sum was apportioned in accordance with the agreement.
The parties were unable to agree on the claim for interest. Directions were made for the provision of submissions by the first respondent, noting that the applicant had already provided her submissions on the claim for interest. The second and third respondents adopted the applicant’s submissions.
The parties were advised that at the conclusion of the time allowed for submissions, the issue of interest would be determined “on the papers”.
The first respondent has now lodged its submissions, subject to a slightly revised timetable, and the applicant has lodged submissions in reply.
I am satisfied that the parties to the dispute understand the nature of the application and the legal implications of any assertion made in the information supplied. I have used my best endeavours in attempting to bring the parties to the dispute to a settlement acceptable to all of them. I am satisfied that the parties have had sufficient opportunity to explore settlement and that they have been unable to reach an agreed resolution of the dispute.

EVIDENCE

Documentary evidence

The following documents were in evidence before the Commission and considered in making this determination:
(a)    the Application and attachments;
(b)    Reply by first respondent and attachments;
(c)    Reply by second respondent and attachments;
(d)    Application to Admit Late Documents dated 5 September 2022 and attachments, filed by the applicant, and
(e)    Reply by third respondent and attachments.

FINDINGS AND REASONS

Submissions

Applicant

The applicant requested that the Commission exercise its discretion to award interest pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act).
The applicant submitted that the Commission has discretion to award interest from the time the claim was duly made, which she submitted was 14 January 2021.
The applicant submitted that an award of interest is not punitive but is to compensate her and the respective respondents for not having the benefit of the money. She submitted that the insurer/scheme agent has been in possession of the award monies, and the worker [sic] has been deprived of their use: Bennett v Jones (1977) 2 NSWLR 355 (Bennett).
The applicant made no criticism of the insurer or their legal representatives in the way the claim had been processed. She submitted that interest is not to be awarded simply on the basis that the first respondent ought to have paid the money earlier, but on the more neutral basis that “the money has been outstanding for a period during which the defendant has had the benefit of not paying it, and the plaintiff the detriment of not having it.” - Beves v Patrick Stevedores No 2 Pty Ltd & Anor [2014] NSWWCC 178 (Beves).
As the insurer had had the benefit of the compensation since 14 January 2021, the applicant submitted it was just and equitable that interest be awarded from 14 January 2021 to the date payment is made.
The applicant submitted that the accepted rate of interest on pre-judgment amounts, at the date the claim was duly made, is 4.1% [per annum] in accordance with NSW District Court Civil Practice Note 15; and the accepted rate on post-judgment amounts is 6.85%, in accordance with rule 36.7(b) [sic rule 36.7(1)(b)] of the Uniform Civil Procedure Rules 2005 (UCPR).
The applicant submitted that interest at the rate of 4.1% is payable upon the entire lump sum from the date the claim was duly made; and from the date of judgment until payment on the entire lump sum at the rate of 6.85%. Any interest payable should be apportioned on the same basis as the apportionment of the lump sum.
In reply to the first respondent, the applicant referred to Haidary v Wandella Pet Foods Pty Ltd [2005] NSWWCCPD 9 (Haidary); ZKM Pty Ltd v Chen [2022] NSWPIC 108 (Chen); and Zhang v UniverseInvestments Pty Ltd t/as Kings Seafoods [2021] NSWPIC 128 (Zhang).
The applicant submitted that where an employer has retained monies to which it was not entitled from the date of the death of its employee in the course of his employment, the benefit of that retention should flow to the dependents or the estate, subject to any disentitling conduct, as defined in s 109(2)(c). She submitted no such conduct is applicable in this case.
The applicant submitted that the legislative intent in providing a death benefit and interest is obviously beneficial, and any discretion should be exercised beneficiBHC.
The applicant accepts that the claim is “duly made” when it is fully particularised. She submitted that once the insurer has all the evidence and material available to make a liability decision, interest should be payable from that point. As death benefits are payable to the estate in the absence of any claim for dependency being maintainable. It would seem that a claim is duly made once the relationship between death and employment is established. She submitted that to whom the benefit is payable is immaterial to the question of liability.
The applicant submitted that full particulars of the extent of dependency are not a necessary precondition of entitlement to interest. When a claim is “duly made” will turn on its own facts.
The applicant referred to the following events:
·        BHC passed away on 11 January 2021.
·        A notification of death was made to the first respondent on 14 January 2021.
·        The first respondent notified the applicant on 21 January 2021 that an investigator had been appointed to “obtain relevant information to assist QBE with determining liability”.
·        A copy of the death certificate was provided to the first respondent on 7 February 2021.
·        The applicant set out full particulars of the worker’s employment leading to his death, and details of the surviving dependants in a statement dated 19 March 2021, provided to the first respondent.
·        There was no question raised by the first respondent as to the sufficiency of the particulars.
·        It cannot be argued that the first respondent required any further information about the beneficiaries or the circumstances of death in order to determine liability.
·        The first respondent accepted liability for the claim on 9 March 2022.
·        The first respondent submitted the claim was not “duly made” until the Application was filed on 18 August 2022. This implies that the extent of dependency is a necessary precondition to entitlement to interest, which is no longer the case.
·        The first respondent was not prevented from bringing proceedings of its own volition at such earlier time.
The applicant submitted that the claim was “duly made” on 19 March 2021, when sufficient particulars were provided to enable the first respondent to determine liability.
As regards the rate of interest, the applicant submitted that in Haidary, Deputy President Fleming was of the view that the Supreme Court interest rate was the most relevant benchmark. She submitted that, despite recent case law in the Commission, it should not develop its own approach on matters like awarding interest.
The applicant submitted that awarding interest at a lower rate puts injured workers at a disadvantage, compared to those bringing claims pursuant to other causes of action. Injured workers have already been disadvantaged through legislative reforms, and it would be unfair for such workers (or in this case dependants) to receive less interest than other litigants.
The applicant BHC submitted that the rate of interest ought to be 4% above the cash rate, as follows [sic]:
19 March 2021 to 30 June 2021: 4.1%
1 July 2021 to 31 December 2021: 4.1%
1 January 2022 to 30 June 2022: 4.1%
1 July 2022 to 25 October 2022: 4.85%

First respondent

The first respondent submitted that no interest should be ordered.
The first respondent referred to the following relevant dates:
·        11 January 2021: date of death.
·        Notification form completed by lawyers acting on behalf of the applicant (date not provided but assumed to be 14 January 2021).
·        9 March 2022: acceptance of liability communicated to Don Cameron & Associates (the applicant’s solicitors).
·        19 [sic 18] August 2022: Application registered.
·        21 September 2022: teleconference when findings were made in relation to payment of lump sum death benefit, together with apportionment of liability orders.
·        Order that further submissions be provided by the first respondent as to interest (with a revised date of 18 October 2022).
The first respondent submitted that the Commission’s power to award interest is discretionary: Haidary; Canham v Kenna Investments Pty Ltd [2006] NSWWWCCPD 202; and Kaur v Thales Underwater Systems Pty Ltd [2011] NSWWCCPD 6 (Kaur).
The first respondent relied on Pheeney v Doolan (No 2) [1977] 1 NSWLR 601 (Pheeney), in which the Court of Appeal held that it was necessary to determine in what respect the plaintiff had been financiBHC disadvantaged by the delay in payment of damages, so as to make an appropriate allowance for interest; and on Bennett.
The first respondent submitted that, of most significance to the exercise of the discretion is that, having regard to ss 85(1)(a) and 85A(1)(a) of the 1987 Act, it has not been, and is still not, legBHC possible for the insurer to pay any part of the lump sum to the respondents [sic] until the Commission has determined dependency and apportionment, and made orders regarding either payment to the NSW Trustee and Guardian or to each adult dependant.
The first respondent submitted that, in theory, it would have been possible for the insurer to immediately pay the lump sum to the NSW Trustee and Guardian, but it is clear that no dependant would ever make such a request. Even if it had been paid immediately to the NSW Trustee and Guardian, no payment would have been made until the Commission determined dependency and apportionment.
Referring to Haidary, Pheeney, and Bennett, the first respondent submitted that the respondents had not suffered a “loss of his or her income”. Had the lump sum been paid to the NSW Trustee and Guardian, the fees imposed would have been to their detriment.
The first respondent submitted that whilst the fact that persons entitled to compensation have not had its use is relevant in other claims, this is not so in claims arising out of the death of a worker. Had the lump sum been paid immediately to the NSW Trustee and Guardian, the person entitled to the compensation would not have received its benefit from the date of payment, or at all, for the reasons that:
(a)     it is common knowledge that the charges imposed would have far exceeded any interest that would have accrued on the lump sum;
(b)     no payment would have been made before the Certificate of Determination (COD) was issued, and
(c)     once the COD has been issued, it should be assumed that payment to any adult dependant will be paid far quicker than if it were to be made by the NSW Trustee and Guardian, as any payment by the latter would be delayed by the need for it to create the necessary accounts.
The first respondent submitted that the respondents have in fact received and will continue to receive financial advantage as a result of the sums not being paid until the issue of the COD. The submissions on their behalf ignore these considerations.
The first respondent submitted that the decision of Member Batchelor in Zhang is incorrect.
The first respondent submitted that it had been evident in discussions with the applicant’s legal representatives from the outset that, following the acceptance of liability, it was desirable that an Application be filed on her behalf and that of other dependants, such that payment of the lump sum would be delayed until the issue of the COD.
As regards the period/s that should be the subject of an order for payment of interest, the first respondent submitted that the respondents’ submissions are inconsistent with the clear statement of opinion by President Keating, relative to fatality claims, in Kaur.
The first respondent referred to other cases that addressed the issue of “duly made” including Cooper v G & W Mudge Concreting Pty Ltd & Ors (6411/18); Lavelle v Browne & Ors (533/19); Alexander v J B Cullinan and N N Cullinan & Ors (4832/20); Lindsay v City Clean Payroll Pty Ltd (6364/20) (Lindsay); A1 Arbor Tree Service Pty Ltd v Matai & Ors (2123/20) (A1 Arbor); Mudgee Explorer Tours Pty Ltd v Clarke [2021] NSWPIC 41 (Clarke); and Youseph v Homebush Unit Trust t/as Primo Smallgoods [2021] NSWPIC 299 (Youseph).
The first respondent submitted that the claim was not “duly made” until the Application was filed on 18 August 2022, when submissions about liability and apportionment were filed.
With respect to the rate at which interest should be ordered, the first respondent submitted that the submissions on behalf of the respondents ignore the recent consistent approach by the Commission to order interest at a rate consistent with the very low rates of interest in recent years.
The first respondent submitted that the exercise of the discretion in accordance with
s 109(1) of the 1998 Act requires the Commission to have regard to the actual rates of interest offered by banks, which have at all relevant times been significantly less and consistent with the cash rates published by the Reserve Bank of Australia (RBA).
The first respondent submitted this was consistent with the approach of Arbitrator Batchelor in Cameron v StateCover Mutual [2015] NSWWCC 325; and Riverdene Equine Hospital Pty Ltd v Tupani [2015] NSWWCC 240.
The first respondent also cited Cameron v Enviro Pallets Pty Ltd (2070/20); Baroudi v Kelly Services Pty Ltd (5220/19); Baldwin v Fleetmaster Services Pty Ltd (1648/20); Talar v Opera Australia (4763/20); Lindsay; Clarke; Zhang; Youseph; JV Jupp Pty Ltd v Fraiter (5947/21); Chen; and McGrath v PM Electric Pty Ltd & Ors [2022] NSWPIC 263.
The first respondent submitted that the cash rate during the relevant period has been as follows:
4 November 2020 to 3 May 2022: 0.10%
4 May 2022 to 7 June 2022: 0.35%
8 June 2022 to 5 July 2022: 1.35%
3 August 2022 to 6 September 2022: 1.85%
7 September 2022 to date: 2.35%
The first respondent submitted that the applicant’s submissions, which have been adopted by the second and third respondents, to the effect that the decisions relied on are wrong, should be rejected.
The first respondent finBHC submitted that, if the Commission is minded to award interest, the rate should be 2% above the cash rate for the relevant period. However, the claim for interest should be dismissed.

SUMMARY

Section 25 of the 1987 Act provides:
“(1)    If death results from an injury, the amount of compensation payable by the employer under this Act shall be--
(a) the amount of $750,000 (the
‘lump sum death benefit’), which is to be apportioned among any dependants who are wholly or partly dependent for support on the worker or (if there are no such dependants) paid to the worker's legal personal representative, and
(b) in addition, an amount of $66.60 per week in respect of--
(i) each dependent child of the worker under the age of 16 years, and
(ii) each dependent child of the worker being a student over the age of 16 years but under the age of 21 years.
(2)     Payments in respect of a dependent child under subsection (1) (b) shall continue--
(a) except as provided by paragraph (b)--until the child dies or reaches the age of 16 years, whichever first occurs, or
(b) in the case of a dependent child who is a student at the time of the worker's death or after reaching the age of 16 years--until the child dies, reaches the age of 21 years or ceases to be a student, whichever first occurs.
(3)     The amount of any weekly payments, or other compensation payable under this Act, shall not be deducted from the amounts referred to in subsection (1) (a) or (b).
(4)     If an amount mentioned in subsection (1) (a) at any time after the commencement of this Act--
(a) is adjusted by the operation of Division 6, or
(b) is adjusted by an amendment of this section,
the compensation payable under subsection (1) (a) is to be calculated by reference to the amount in force at the date of death.
(4A) If the death of a worker results both from an injury received before the adjustment of an amount mentioned in subsection (1) (a) and an injury received after that adjustment, the worker shall, for the purposes of subsection (1) (a), be treated as having died as a result of the injury received after that adjustment.
(5)     In this section--
‘child of the worker’ means a child or stepchild of the worker and includes a person to whom the worker stood in the place of a parent.
‘dependent child of the worker’ means a child of the worker who was wholly or partly dependent for support on the worker.
‘student’ means a person receiving full-time education at a school, college or university.”

Section 29 of the 1987 Act provides:
(1)     The compensation payable under this Division to each dependant of a deceased worker may be apportioned by the Commission or by the NSW Trustee.
(1A) The lump sum death benefit payable under this Division is not to be apportioned if a deceased worker leaves only one dependant (whether wholly or partly dependent on the worker for support) and the whole of the lump sum death benefit is to be paid to that one dependant.
(1B) In apportioning the lump sum death benefit payable under this Division between 2 or more dependants, the whole lump sum death benefit is to be apportioned among those dependants (so that the sum of the apportioned amounts equals the full lump sum death benefit).
(2)     Application for apportionment may be made by or on behalf of a person entitled to the compensation--
(a) to the NSW Trustee, or
(b) to the Commission (whether or not an application has been made to the NSW Trustee or the NSW Trustee has made a decision).
(3)     The NSW Trustee may decline to deal with an application for apportionment and advise the parties to apply to the Commission.
(4)     The NSW Trustee is not to deal with an application for apportionment of compensation if an application for apportionment of the same compensation is before the Commission.
(5)     A decision by the NSW Trustee to apportion compensation under this Division is subject to any decision made by the Commission with respect to the matter.
(6)     If there are both total and partial dependants of a deceased worker, the compensation may be apportioned partly to the total and partly to the partial dependants.
(7)     If a dependant dies--
(a) before a claim under this Division is made, or
(b) if a claim has been made, before an agreement or award has been arrived at or made,
the legal personal representative of the dependant has no right to payment of compensation, and the amount of compensation shall be calculated and apportioned as if that dependant had died before the worker.
(8)     The regulations may make provision for or with respect to the publication of applications for apportionment and any other matter connected with apportionment.”
Section 109 of the 1998 Act provides:
“(1)    In any proceedings before the Commission, the Commission may order that there is to be included, in any sum to be paid, interest at such rate as the Commission thinks fit on the whole or any part of the sum for the whole or any part of the period before the sum is payable, subject to the limitations imposed by this section.
(2)     Interest cannot be ordered under this section--
(a) on any compensation payable under Division 4 of Part 3 of the 1987 Act, or
(b) on any compensation payable under this Act for any period before a claim for the compensation was duly made, or
(c) on any compensation payable under this Act for any period during which proceedings before the Commission were adjourned on the application of the claimant for the compensation or pursuant to section 102.
(3)     This section does not--
(a) authorise the giving of interest upon interest, or
(b) apply in relation to any debt upon which interest is payable as of right whether by virtue of any agreement or otherwise.”
The power to award interest is discretionary and may apply to some or all of the compensation payable, for the entire period, from the date of the claim to the date of the order, or for a lesser period. The rate of interest is also a discretionary matter. However, while the discretion is wide, regard must be held to the facts of the case.
In Haidary, Fleming DP said:
“The award of interest by the Commission, pursuant to section 109 of the 1998 Act is discretionary. Mr Haidary will only be entitled to interest, if awarded, on those amounts of his weekly entitlement that were unpaid, and only from the date that his claim ‘was duly made’. The likely amount of interest that would be due on these sums is small, relative to the whole of his claim, but nonetheless they may form part of Mr Haidary’s entitlement. The purpose of ordering interest on an award is to compensate the worker for the loss of his or her income, not to penalise the employer (Virag v James N Kirby t/as Betts Electric Motors (1990) 6 NSWCCR; Healey v McPherson Binding Pty Ltd (1989) 5 NSWCCR 139).”
In my view, it is appropriate that I exercise my discretion to award interest in this matter. However, s 109(2)(b) provides that interest cannot be ordered for any period before a claim was duly made.
President Keating said in Kaur:
“Section 109(2)(b) of the 1998 Act prohibits interest on any award of compensation payable under the Act for any period before a claim for compensation on behalf of the appellants was duly made. I accept the submission that the claim for compensation on behalf of the appellants was not duly made until the day of the arbitration. I therefore accept Thales’s submission that, as at the arbitration, the appellants could not be entitled to interest pursuant to s 109 of the 1998 Act”.
The phrase “duly made” has been held to mean “fully particularised”. It was applied in Kathryn Ann Kratz as executrix of the estate of the late Owen Beddall v Qantas Airways Limited [2020] NSWWCC 36, in which Arbitrator Isaksen referred to the decision of Arbitrator Wynyard in Cooper and his own decision in Lavelle, in which he agreed with Arbitrator Wynyard’s approach. Member Wynyard took a similar approach in Clarke.
The applicant has submitted both that the claim was duly made on 14 January 2021, when the first respondent was notified of the worker’s death (which notification is not before me); and on 19 March 2021, the date of her first statement.
I do not accept either submission. The claim was not “fully particularised”, so that the first respondent was in a position to determine it, when it was merely notified of the worker’s death. The applicant’s first statement provided no information about the extent of her dependency, that of the children, or any other potential dependants. It was concerned solely with the issue of whether the worker’s death resulted from injury arising out of or in the course of his employment with the first respondent.
The first statement by the applicant in which she provided evidence of her dependency and that of the children of the marriage, including documentary evidence, is an affidavit dated 2 August 2022, and sworn on 16 August 2022. It is attached to the Application that was registered on 18 August 2022. In my view, the claim was “duly made” on 18 August 2022.
The applicant submitted that the first respondent was not prevented from bringing the proceedings of its own volition. It is correct that it could have done so. However, they would have been deficient, in that the first respondent did not have the evidence of dependency that was provided in the Application. The first respondent requested in its letter dated 9 March 2022 that the applicant’s solicitors obtain instructions to file an Application and that was done in August 2022.
The award of interest will date from 18 August 2022.
The first respondent submitted that, as it was unable to pay the lump sum benefit before the orders were made, the applicant and the other respondents have not suffered any loss, because, had the monies been paid to the NSW Trustee and Guardian, they would have been depleted by the fees payable, to their detriment. I do not accept that submission.
In Pheeney, Moffitt P said:
“While the essential nature of the award is to compensate a plaintiff by reason of delay in payment of moneys, there is no entitlement to interest. The court must be persuaded that it is just, between the plaintiff and defendant, to make an order of interest in relation to each of the elements referred to in the section, namely the rate, the sum to bear interest, and the period for which interest is to accrue.”
Reynolds JA observed in Pheeney (at [613]) that the purpose of s 94 (since repealed) of the Supreme Court Act 1970 is:
“....to aid the court to do more complete justice between the parties than otherwise possible. It does not confer a substantive right to interest upon creditors and persons who have suffered injury to personal property, and its application is dependent upon proceedings being instituted in the Supreme Court and continuing to judgment. It is not designed to compensate a plaintiff for loss arising out of cause of action, but to provide compensation where it is otherwise appropriate to do so for the circumstance that a sum of money has been outstanding to him for a period of time.”
What Moffitt P said in Bennett, (at 367), was:
"A number of questions arise. Is the power to award interest such that it should be used punitively, so a plaintiff or defendant is penalised for delay or failure to observe court procedures; or is it entirely compensatory, so as to do no more than that which is fair in a pecuniary sense between the parties? Is the jurisdiction to be exercised, or not exercised, simply by inquiry whether the defendant ought to have paid money to the plaintiff at some earlier date; or is it to be awarded on some more neutral basis, as that, for some reason, the money has been outstanding for a period, in which the defendant had the benefit of not paying it and the plaintiff the detriment of not having it, and that delay and the conduct of a party is relevant, only so far as by reason of it, there is, or may be, economic disadvantage to the opposing party by an award of interest being, or not being, made? For reasons I will indicate, in my view the approach last mentioned in each of the two foregoing queries is that which is in conformity with the statute.” (Emphasis added).
His honour continued, at 370:
“I see no reason why the simple fact that a defendant does not have to pay money when his liability arises, and has the benefit of non-payment for a period, should not provide a basis to make a discretionary order for payment of interest for the whole period. One had the money, and the other not. If it is not a commercial setting, the gain and loss may not be measured by a commercial rate of interest.”
As Arbitrator Sweeney (as he then was) said in Beves, in a “death claim”, where the compensation has not been paid, the insurer/scheme agent has been in possession of the award monies, and the worker [sic] has been deprived of their use. He noted that the common law principles must be considered in the light of s 109 of the 1998 Act.
Arbitrator Sweeney pointed out that the course of events that transpired in Beves was beyond the control of the insurer. He said:
“Nevertheless, the insurer has had the compensation moneys throughout this period and presumably invested it to its advantage. To paraphrase Bennett, interest is not to be awarded simply on the basis that the respondent ought to have paid the money earlier, but on the more neutral basis that ‘the money has been outstanding for a period during which the defendant has had the benefit of not paying it, and the plaintiff the detriment of not having it’”.
It is not to the point that, had the insurer paid the monies to the NSW Trustee and Guardian, they may have been depleted. What is to the point is, as Moffitt P said, “for some reason”, they have been outstanding, and during that period, the insurer had the benefit of their use. It is also not to the point, as was the case in Beves, that the course of events was outside the first respondent’s control.
As regards the rate at which interest should be awarded, I do not accept the applicant’s submission that the appropriate rate should be 4% above the cash rate.
Section 109(1) provides that the Commission may order interest at such a rate as it thinks fit. The actual rates of interest offered by banks have been at historic low levels, although they have recently shown some upward trend, in light of the RBA having raised the cash rate.
It is unlikely that the first respondent, while it has had the benefit of the lump sum, was able to achieve interest rates that were 4% above the cash rate, or that the applicant, the second respondent and the third respondent would have been able to do so, had the monies been in their hands.
As the first respondent submitted, the approach of the Commission has been to award interest at a rate consistent with the recent rates of interest. I accept the submission that an appropriate rate of interest is 2% above the cash rate for the relevant period.
The relevant cash rates were as follows:
18 August 2022 to 6 September 2022: 1.85%
7 September 2022 to 4 October 2022: 2.35%
5 October 2022 to 1 November 2022: 2.6%
2 November to date: 2.85%
I therefore determine that the first respondent is to pay interest on the lump sum, in the same proportions as the apportionment, at the following rates:
From 18 August 2022 to 6 September 2022: 3.85% per annum
From 7 September 2022 to 4 October 2022: 4.35% per annum
From 5 October 2022 to 1 November 2022: 4.6% per annum
From 2 November 2022 to 3 November: 4.85% per annum

85.The orders are as set out in the Certificate of Determination.

[2022] NSWPIC 615

4 November 2022