BDU by next friend Bko v State of New South Wales (NSW Police Force)

CERTIFICATE OF DETERMINATION OF MEMBER
Citation:	BDU by next friend BKO & Ors v State of New South Wales (NSW Police Force) & Ors [2023] NSWPIC 208
APPLICANT:	BDU by next friend BFO
FIRST RESPONDENT:	State of New South Wales (NSW Police Force)
SECOND RESPONDENT:	BHL
THIRD RESPONDENT:	BIV
Member:	John Isaksen
DATE OF DECISION:	8 May 2023
CATCHWORDS:	WORKERS COMPENSATION - Apportionment of lump sum death benefit for three children of the deceased worker; agreement reached between the three dependants; claim for interest on payment of the lump sum death benefit; Held – orders made in accordance with the agreement as to apportionment, along with the payment of interest at various dates based upon when the claim was duly made by each dependant.
determinations made:

The Commission determines:

The worker, BJM (the deceased worker) died on 2 January 2021.
The deceased worker died as a result of an injury she sustained whilst in the course of her employment as a police officer with the first respondent, State of New South Wales (NSW Police Force), with a deemed date of injury of 12 May 2016.
The following persons were dependent for support upon the deceased worker at the time of her death:
(a)    BDU, a daughter of the deceased worker;
(b)    BHL, a son of the deceased worker, and
(c)    BIV, a son of the deceased worker.
No other persons were dependent for support, or have claimed to be dependent for support, upon the deceased worker.
The lump sum benefit payable in accordance with s 25 of the Workers Compensation Act1987 (the 1987 Act) at the date of death of the deceased worker is $834,200.

The Commission orders:

Pursuant to s 29 (1B) of the 1987 Act, the lump sum benefit is apportioned as follows:
(a)    the first respondent is to pay BDU the sum of $417,100, such sum to be paid to the NSW Trustee in trust for the benefit of BDU pursuant to s 85 of the 1987 Act;
(b)    the first respondent is to pay BHL the sum of $291,970 pursuant to s 85A of the 1987 Act, and
(c)    the first respondent is to pay BIV the sum of $125,130 pursuant to s 85A of the 1987 Act.
Pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, the first respondent is to pay interest on the lump sum death benefits to be paid to the three dependents as follows:
(a)    5.10% per annum on the amount of $417,100 to be paid to the benefit of BDU from 21 December 2022 to 5 May 2023;
(b)    5.10% per annum on the amount of $291,970 to be paid to BHL from 20 January 2023 to 5 May 2023, and
(c)    5.10% per annum on the amount of $125,130 to be paid to BIV from 29 March 2023 to 5 May 2023.
Pursuant to s 25 (1A) of the 1987 Act and cl 177 of the Workers Compensation Regulation 2016, the first respondent is to pay the amount of $15,154.50 to the NSW Trustee as additional compensation fees for the management of the lump sum benefit that is to be paid to BDU.
Pursuant to s 25 (1)(b)(ii) and s 31 (1)(a) of the 1987 Act, the first respondent is to pay weekly payments of compensation to BFO for the benefit of BDU as follows:
(a)    $149.30 per week from 2 January 2021 to 31 March 2021;
(b)    $150.20 per week from 1 April 2021 to 30 September 2021;
(c)    $152 per week from 1 October 2021 to 31 March 2022;
(d)    $154.40 per week from 1 April 2022 to 30 September 2022;
(e)    $156 per week from 1 October 2022 to 31 March 2023, and
(f)    $159.50 per week from 1 April 2023 to date and continuing.
Pursuant to s 25 (1)(b)(ii) of the 1987 Act, the first respondent is to pay weekly payments of compensation to BHL as follows:
(a)    $149.30 per week from 2 January 2021 to 31 March 2021;
(b)    $150.20 per week from 1 April 2021 to 30 September 2021, and
(c)    $152 per week from 1 October 2021 to 27 November 2021.
The first respondent is to pay the costs of the applicant, second respondent and third respondent as agreed or assessed.
This matter is certified as being complex and a 15% uplift on costs is payable pursuant to Item 4 of Table 4 of Schedule 6 of the Workers Compensation Regulation 2016.
Liberty to apply in regard to the calculation of additional compensation fees for the management of the lump sum benefit that is to be paid to BDU.

STATEMENT OF REASONS

BACKGROUND

This application was filed on behalf of Grant Gibson, the de facto spouse of the late BJM (the deceased worker), wherein he claimed a lump sum death benefit of $834,200 following the death of the deceased worker.
The deceased worker died on 2 January 2021 as a result of an injury sustained whilst in the course of her employment as a police officer with the first respondent, State of New South Wales (NSW Police Force).
The first respondent accepted liability for the claim for a lump sum death benefit on
16 May 2022.
The following persons also claim to have been dependent for support upon the deceased worker:
(a)    BDU, a daughter of the deceased worker;
(b)    BHL, a son of the deceased worker, and
(c)    BIV, a son of the deceased worker.
A timetable was set at a preliminary conference held on 10 March 2023 for all parties to provide written submissions on the issues of apportionment and interest, and any submissions in reply.
The lawyers acting for Grant Gibson advised that Mr Gibson died after the preliminary conference which was held on 10 March 2023.
A further conference was held on 4 April 2023. Mr Gibson was removed as the applicant in these proceedings pursuant to Rule 62 (2)(c) of the Personal Injury Commission Rules 2021, and BDU by her next friend BFO was named as the applicant in these proceedings. A revised timetable was set at that further conference for all parties to provide written submissions on the issues of apportionment and interest, and any submissions in reply.
The following documents were taken into account in making this determination:
(a)    Application to Resolve a Dispute (ARD);
(b)    Reply filed by the first respondent and attached documents;
(c)    written submissions filed by the first respondent on 28 April 2023;
(d)    Reply filed on behalf of BDU and attached documents;
(e)    statements of BFO and the BDU filed on
28 March 2023;
(f)    written submissions filed on behalf of BDU on 20 April 2023;
(g)    Reply filed by BHL and attached documents;
(h)    statement of BHL dated 29 March 2023;
(i)    written submissions filed on behalf of BHL on 21 April 2023;
(j)    Reply filed by BIV and attached documents, and
(k)    written submissions filed on behalf of BIV on 4 April 2023.

FINDINGS AND REASONS

Apportionment

BDU has recently turned 17 years of age. A letter from Springwood High School dated 18 July 2022 states that BDU will complete her HSC studies this year.
BDU has provided a statement dated 17 February 2023. She states that she is the youngest of four children of the deceased worker.
BDU states that in 2016 her mother and father separated, and she chose to live with her mother in a detached house in Lethbridge Park. She states that her siblings stayed with their father, BFO, in Faulconbridge. BDU states that her mother looked after her.
BDU states that Grant Gibson moved into the Lethbridge Park house in late 2017 and in early 2018 “Grant kicked me out of the house” and she moved back to live with her father.
BDU states that she is an average student and finds it hard to study. She states: “So much has happened to me over the last few years with mum.” BDU states that at this stage she is still uncertain as to what she will study after she leaves school, and that she might go to TAFE and do a bridging course so that she can enter university. She expects it will take three to four years to complete such a course.
BDU states that she believes that her mother would be supporting her if her mother was still alive.
BHL has provided a statement dated 29 March 2023. BHL is currently 19 years of age.
BHL states that he lived with his father after his parents separated in 2016. He states that he initially saw his mother about once a month after the separation, but by 2018 he was only seeing her on birthdays and at Christmas. He states that he continued to have a good relationship with his mother and maintained contact by text messages.
BHL states that he commenced an apprenticeship with Eastbrook Constructions Pty Ltd on 28 November 2021. He states that he currently is paid at $18.50 per hour, plus $22 per hour for a travel allowance. He pays $50 per week in board to his father. He states that he took out a loan from the bank for $6,500 in June 2022 to buy tools needed for his work and is currently paying $75 per week to repay that loan. He states that he receives no financial support from his father.
BHL states that he owns a 2007 Ford Ranger which he uses to carry his tools and other equipment for his work, but due to the age of the vehicle he has spent about $10,000 on the vehicle over the past year. He states that he had to borrow $4,500 from his sister last year to have this vehicle fixed. He states that he has a balance of about $900 in his bank account.
BIV has provided a statement dated 29 March 2023. BIV is currently 21 years of age.
BIV states that he would visit his mother each week and stay overnight with her after his parents separated. He states that this continued for about two and a half years and then his mother and Mr Gibson “started to become particularly close”. He states that the visits then reduced to being each month.
BIV states that his mother took steps to demonstrate her love for him in various manners and nominates a gift made by her of a 2001 Hyndai Ascent which he was able to drive to obtain his drivers licence.
BIV states that he was 19 years old when his mother died. At the time he was working full time as a sales representative for Rug World Pty Limited. He states that he was dependent upon his mother as the central female role model in his life. He states that her death has deprived him of emotional and financial support which he expected to receive from her.
BFO has provided a statement dated 17 February 2023. BFO states that he was married to the deceased worker and that they had four children together – BKL, BIV, BHL and BDU.
BFO states that he had a severe stroke in October 2013.
BFO states that the deceased worker walked out on her family in about 2016. He states that BDU lived with her mother, but BDU was kicked out of that home by
Mr Gibson in 2017 and returned to live with BFO in Faulconbridge.
BFO states that the deceased worker made direct payments into his bank account for child support from October 2015 to the time of her death. BFO lists the details of those payments as follows:
Financial year ending   Total amount paid
30 June 2017  $11,413
30 June 2018  $10,071
30 June 2019  $19,170
30 June 2020  $22,693
Up to 18 January 2021  $10,944
BFO has provided copies of some assessments of child support made by the Department of Human Services from November 2018 to 31 December 2020. The assessment made for the quarter ending 31 December 2020 is for the support of BDU and BHL.
BFO states that BDU receives an allowance of about $500 each year from the high school to assist with her obtaining books and other school items. He states that this would not have been needed if the deceased worker was still alive.
No claim for part of the lump sum death benefit has been made by BKL.
The lawyers for BDU, BHL and BIV have advised that agreement has been reached as to the apportionment of the lump sum death benefit as follows:
(a)    BDU  50%  $417,100;
(b)    BHL   35%  $291,970, and
(c)    BIV             15%  $125,130.
I am of the view that so long as an agreement between dependents on apportionment is within the boundaries of what is reasonable, then that agreement should be endorsed by the Commission.
The agreement between the three children is reasonable. It provides for half of the lump sum to be paid to the benefit of BDU, whose future trajectory in life at this stage remains unclear. She concedes that she is an average student but wants to try and undertake further study, including the possibility of university. Considerable support should be provided to her when compared to the situation of her two brothers.
I am also mindful that the agreement hopefully maintains harmony between the three siblings which might otherwise be put at risk if the Commission embark on its own determination of the apportionment of the lump sum death benefit.
There is no significant difference in the current needs of BHL and BIV, and no indication that those needs are likely to change in the future. Both are to be commended for being able to obtain full time employment soon after leaving school and maintaining that employment. The portion of the lump sum which they have both agreed to otherwise reflects their relative difference in age. There should be a greater amount of the lump sum death benefit payable to BHL because he was dependent upon his late mother for over four years while he was still at school.
Orders will therefore be made for the apportionment of the lump sum death benefit in accordance with the agreement reached between the three dependents.

The claim for interest on the lump sum death benefit

BDU, BHL and BIV all claim interest on the lump sum death benefit.
The submissions in support of the payment of interest on the lump sum death benefit are made by the lawyers for BDU and supported by the other two dependents. It is submitted that interest should run from when the ARD was filed, being 14 October 2022. In the alternative, interest should run from when the Reply was filed by each of the dependents.
The power to award interest is provided in s 109 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act), which relevantly 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) …
(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)     …”
The decision as to when interest should be payable on the lump sum death benefit, and at what rate, has been the subject of many determinations by the Commission in recent years, and has been well summarised in written submissions filed on behalf of the first respondent.
In Kaur v Thales Underwater Systems Pty Ltd [2011] NSWWCCPD 6 (Kaur), Keating P said at [139]:
“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 the compensation 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.”
In an arbitral decision of Shanika Cooper v G & W Mudge Concreting Pty Ltd & others (WCC6411/18) Arbitrator Wynyard referred to the decision in Kaur to form the view that the phrase “duly made” refers to a date when an applicant’s claim is fully particularised. I agreed with that approach in a subsequent unpublished decision of Lavelle v David Paul Browne & others (WCC533/19) and a decision of Kathryn Ann Kratz as executrix for the estate of the late Owen Beddall v Qantas Airways Limited [2020] NSWWCC 36. Similar approaches have been taken by other Members and are set out in the first respondent’s written submissions.
The first respondent submits that the claim by each dependent was not ‘duly made’ until the Reply from each dependent was served and nominates those dates for each of the three dependents as follows:
(a)    for BDU:  21 December 2022;
(b)    for BHL:  20 January 2023, and
(c)    for BIV:  29 March 2023.
I agree with the dates nominated by the first respondent as to when the payment of interest should run from. It is consistent with the approach taken in Kaur, Cooper and Lavelle.
The lawyers for BDU submit that the rate of interest to be applied should be in accordance with Part 6.12 of the Uniform Civil Procedure Rules 2005 which provides that the rate of interest should be 4% above the RBA cash rate. A rate of 7.10% is nominated.
The first respondent has referred to several decisions of Arbitrators and Members which have set interest at or around 2% above the RBA cash rate. Those decisions have emphasised a practical approach to the awarding of interest having regard to a period of some years now where interest rates have been very low. The first respondent submits that the same approach should be taken in this dispute.
There has been an increase in interest rates over the last 12 months or so, however rates for investment remain comparatively low. I therefore consider that interest at 2% above the RBA cash rate remains fair and reasonable for the payment of interest as provided for by s 109 of the 1998 Act.
There has been an increase in the cash rate of .5% since 21 December 2022, but to assist in the calculation of interest, and the additional compensation fees payable for the benefit of BDU, and in the exercise of the discretion provided by s 119 of the 1998 Act, the interest rate for all the periods when interest is to be awarded will be set at 5.1%.
There will be awards of interest on the lump sum death benefits to be paid to the three dependents as follows:
(a)    5.10% per annum on the amount of $417,100 to be paid to the benefit of BDU from 21 December 2022 to 5 May 2023;
(b)    5.10% per annum on the amount of $291,970 to be paid to BHL from 20 January 2023 to 5 May 2023, and
(c)    5.10% per annum on the amount of $125,130 to be paid to BIV from 29 March 2023.

Additional compensation fees

I have calculated the interest to be paid on that part of the lump sum death benefit to be paid for the benefit of BDU to be $2,214.63 (being 38 days at 5.1% per annum on $417,100).
I have calculated the additional compensation fees to be paid to the NSW Trustee pursuant to s 25 (1A) of the 1987 Act and cl 177 of the Workers Compensation Regulation 2016 (the 2016 Regulation) for the management of the lump sum benefit that is to be paid to BDU to be $15,154.50. The calculation is as follows:
$1,309 + ((($417,100 + $2,214.63) x 0.0055) + $6,600) + ($917.82 x 0.95) + (($417,100 + $2,214.63) x 0.0097) = $15,154.50.
However, I will grant liberty to apply if there is any disagreement on this calculation.

Weekly payments of compensation

BDU and BHL were both students in high school when their mother died on 2 January 2021.
BHL states that he commenced employment with Eastbrook Constructions Pty Ltd on 28 November 2021 and he claims weekly payments of compensation from
2 January 2021 to 27 November 2021. There is no evidence of any gap between finishing school and commencing employment but, in any event, it could only have been a matter of days. There will therefore be an order that BHL be paid weekly payments of compensation pursuant to s 25 (1)(b)(ii) of the 1987 Act as follows:
(a)    $149.30 per week from 2 January 2021 to 31 March 2021;
(b)    $150.20 per week from 1 April 2021 to 30 September 2021, and
(c)    $152 per week from 1 October 2021 to 27 November 2021.
BDU remains at school and weekly payments will be paid to her father, BFO, for her benefit as provided for by s 31 (1)(a) of the 1987 Act as follows:
(a)    $149.30 per week from 2 January 2021 to 31 March 2021;
(b)    $150.20 per week from 1 April 2021 to 30 September 2021;
(c)    $152 per week from 1 October 2021 to 31 March 2022;
(d)    $154.40 per week from 1 April 2022 to 30 September 2022;
(e)    $156 per week from 1 October 2022 to 31 March 2023, and
(f)    $159.50 per week from 1 April 2023 to date and continuing.

Costs

The deceased worker died as a result of an injury she sustained whilst in the course of her employment as a police officer with the first respondent. The amendments which were made to workers compensation legislation in 2012, including restrictions on costs to be paid by an employer, do not apply to the compensation which is payable as a result of the injury and death of the deceased worker.
There will be an order that the first respondent pay the costs of the applicant, second respondent and third respondent as agreed or assessed.
The applicant;
“requests that the Member certify that Item 6 of Table 4 of Schedule 6 applies to the costs payable in this matter as the claim will be ‘resolved by an award or settlement apportioned between more than one respondent’ and an uplift of 30% applies in accordance with this item.”
However, there is no provision in Item 6 for the Commission to ‘certify’ an uplift of 30%. That must be addressed in an application for an assessment of costs.
The applicant requests, in the alternative, that an uplift of 30% in costs should apply as provided for by Item 4 of Table 4 of Schedule 6 of the 2016 Regulation because extra work was required of the applicant including additional legal work, correspondence and multiple preliminary conferences.
The first respondent has not provided any response to this request.
Liability had been admitted by the first respondent by the time the applicant had joined these proceedings in December 2022. There was little material provided by the applicant in support of her claim other than a statement from herself and her father.
However, it was necessary for the applicant to be represented at two conferences conducted by the Commission. I also accept that there would have been professional work undertaken between the representatives of the three dependents which resulted in the agreement as to apportionment, and which has reduced the amount of time dedicated to writing a decision on apportionment and has removed the need for a hearing.
In those circumstances I consider and certify that this matter was complex and a 15% uplift on costs is reasonable for the complexity involved in this dispute.

[2023] NSWPIC 208

8 May 2023