Dundullimal Holdings trading as Western Parcel Express v Minett - [2007] NSWWCCPD 175

WORKERS COMPENSATION COMMISSION

DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR

CITATION:Dundullimal Holdings t/as Western Parcel Express v Minett [2007] NSWWCCPD 175
APPELLANT:  Dundullimal Holdings t/as Western Parcel Express
RESPONDENT:  Mark Minett
INSURER:CGU Workers Compensation (NSW) Limited
FILE NUMBER:  WCC16012-2006
DATE OF ARBITRATOR’S DECISION:          20 February 2007
DATE OF APPEAL DECISION:  9 August 2007
SUBJECT MATTER OF DECISION: Leave to appeal - no sum claimed by way of compensation; jurisdiction of the Commission where section 289 of the Workplace Injury Management and Workers Compensation Act 1998 not satisfied.
PRESIDENTIAL MEMBER:  Acting Deputy President Michael Snell
HEARING:On the papers
REPRESENTATION:  Appellant: Leigh Virtue & Associates
Respondent: Adams Leyland

ORDERS MADE ON APPEAL: Leave to appeal is refused
The Appellant Employer is to pay the Respondent Worker’s costs of the appeal.

BACKGROUND TO THE APPEAL

On 23 February 2007 Dundullimal Holdings t/as Western Parcel Express (‘the Appellant Employer’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision, dated 20 February 2007.

The Respondent to the Appeal is Mark Minett (‘the Respondent Worker’).

The Respondent Worker commenced employment with the Appellant Employer on about 23 August 2004, as a truck driver. He lodged a claim form dated 24 March 2005 with the Appellant Employer. That document described an injury to the left hip and lower back on 9 March 2005, “While climbing out of truck”. It said the Respondent Worker gave notice of the injury on 9 March 2005, and stopped work on 17 March 2005. It said the part was normal before the accident, and the Respondent Worker had not previously suffered similar or related injuries or conditions.

The Respondent Worker underwent a lumbar laminectomy in September 2005. It was said, without objection or contradiction, on the arbitration hearing, that the insurer of the Appellant Employer, CGU Workers Compensation (NSW) Limited (‘CGU’), paid compensation benefits (T1.45), and such payments included all “entitlements to date, including sections 66 and 67” (T4.30). It was not suggested there was any compensation claimed by the Respondent Worker, which remained outstanding.

The Application to Resolve a Dispute (‘the ARD’) was registered on 11 October 2006. The ARD was filed by the Appellant Employer. It described the weekly compensation in dispute as $500.00 per week from 17 March 2005 to date and continuing (in Part 4 Claim Details). The “Reason for Dispute” nominated in that part of the ARD was “The insurer has not made a correct decision within 21 days of the claim being lodged or the period of provisional liability”. The word “correct” was inserted in handwriting in this line of the printed form.

The ARD was served by the Appellant Employer on CGU, which lodged a Reply (through its solicitors, Bartier Perry) on 1 November 2006. Bartier Perry wrote to the Registrar of the Commission on 21 November 2006, confirming they acted for CGU, the Appellant Employer’s insurer, and stating they were instructed to withdraw the Reply, communicate CGU did not raise any dispute as to ‘injury’, nor dispute the Respondent Worker’s entitlement to compensation generally, and advise CGU sought to participate in the proceedings and assist with their resolution. A copy of this letter was forwarded to the Respondent Worker under covering letter of the same date.

The Respondent Worker’s solicitors, in the Application to Admit Late Documents accompanying their Reply, stated the ARD had not been served on their client, and the letter from Bartier Perry dated 21 November 2006 was the first notification their client had of these proceedings.

Bartier Perry wrote to the Commission on 22 January 2007, advising “Since our client does not raise any issue concerning injury or liability generally and with a view to minimising legal costs, we have been instructed to indicate to you that CGU does not wish to participate in the upcoming conciliation/arbitration hearing.” Copies of this letter were forwarded to the solicitors for the Respondent Worker and the Appellant Employer.

The matter was listed for arbitration hearing on 8 February 2006. The Appellant Employer and the Respondent Worker were represented by solicitors. CGU did not participate in the arbitration hearing. The Appellant Employer’s position was indicated by its solicitor:

(i)His client disputed the Respondent Worker’s claim “for a number of reasons but primarily because the applicant employer says there was no such injury” (that of 9 March 2005) (T1.40).
(ii)His client disputed the decision by CGU to accept liability, and pay compensation benefits (T1.45).
(iii)His client did not know whether CGU was paying compensation on the basis of the injury of 9 March 2005, or something else (T1.55), however that injury was the only one in respect of which the Commission had jurisdiction. He reiterated at T10.40 “The insurer has elected, for whatever reason, to pay benefits in respect of one or other injury or something else to the applicant (sic). The insurer’s not in a position where they’re disputing anything.”
(iv)His client was entitled to bring the proceedings, as it was a “party to a dispute about a claim” within the meaning of section 288(1) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’).

The Respondent Worker’s solicitors had previously made written submissions dated 7 February 2007, in support of the proposition the matter should be referred as a question of law to the President of the Commission. That document was made available to the Arbitrator and the solicitor for the Appellant Employer, and was relied upon at the arbitration hearing. Correspondence dealing with the claim by the Respondent Worker upon the Appellant Employer, for lump sum compensation pursuant to sections 66 and 67 of the 1987 Act, was attached to the submissions. Also attached was a ‘Complying Agreement’ dated 5 February 2007, setting out the settlement reached on the Respondent Worker’s claim for lump sum compensation. That document described the dates of injury as “September 2004 & March 2005”. It described the medical report relied upon by the parties to assess the degree of permanent impairment, as that of Dr Colin Davis dated 12 October 2006. Dr Davis examined the Respondent Worker at the request of CGU on 14 September 2006. The settlement was in a sum of $12,500.00 (representing 10% whole body impairment), together with $15,000.00 (in respect of pain and suffering). Whilst the copy of this agreement attached to the submissions was executed only on behalf of the Respondent Worker, it was not suggested during the arbitration hearing it other than accurately set out the basis on which the lump sum claim had been resolved. The Respondent Worker’s solicitor also challenged the Appellant Employer’s standing to bring the matter before the Commission. He pointed out the Appellant Employer has needed to amend the printed ARD form, to lodge it. He submitted there was no ‘dispute’ to be referred to the Commission for decision (see T3 to T4). He also submitted that, if the true nature of any dispute was that it was one between the Appellant Employer and CGU regarding premiums, the appropriate procedure was referral of such dispute to the Workcover Authority (T5.10).

THE DECISION UNDER REVIEW

The ‘Certificate of Determination’, dated 20 February 2007 records the Arbitrator’s orders as follows:

1. That the Application is dismissed pursuant to section 354(7A)(b) of the Workplace Injury Management and Workers Compensation Act 1998.
2. That the Applicant employer pays the Respondent’s costs as agreed or assessed.

The decision was ex tempore, the reasons were sound recorded, and appear at T11.20 to T13.5. The Appellant Employer’s solicitor then made further submissions, regarding the availability of section 354(7A), and also the possibility of joining CGU as a respondent to the ARD. The Arbitrator then delivered further short reasons, stating in his view section 354(7A) was available to permit the making of the orders, and further stating the joinder of CGU as a respondent would not cure the problem the Respondent Worker had been, in the Arbitrator’s view incorrectly, named as a respondent.

The Arbitrator’s reasons for his decision may be paraphrased as follows:

(i)The real dispute was one between the Appellant Employer and its insurer, CGU, rather than one between the Appellant Employer and the Respondent Worker.
(ii)Thus the ARD pleaded an incorrect party, the Respondent Worker. It was not the spirit and intention of the legislation to force a worker to contend with two sets of proceedings, with both an insurer and an employer.
(iii)An insurer was entitled, by the doctrine of subrogation, to stand in the place of an employer, in dealing with a claim for compensation. The Arbitrator referred to the statutory policy found in Form 3, Schedule 1 to the Workers Compensation Regulation 2003.
(iv)CGU, after receiving the claim form, investigated its liability, and then accepted liability to pay weekly compensation, medical expenses, and lump sum compensation. That the Appellant Employer’s real dispute was with CGU, was demonstrated by the handwritten insertion of the word “correct” in that part of the ARD referred to at [5] above.
(v)Section 354(7A) of the 1998 Act gave the Commission power to dismiss proceedings which were misconceived, and such power should be exercised in the circumstances.

ISSUES IN DISPUTE

The issues raised by the Appellant Employer in its Application to Appeal Against Decision of Arbitrator are as follows:

(i)The Arbitrator erred in categorising the dispute as one between the employer and the insurer only. It is submitted “it was clear to all parties” the dispute was also one between the Appellant Employer and the Respondent Worker. In support of this, reference is made to the fact CGU initially lodged a Reply. It is further submitted sections 287(1) and 288(1) of the 1998 Act enable any party to a dispute (including the employer) to refer the dispute to the Commission for determination. In addition, the Appellant Employer submits even if the Arbitrator was correct in categorising the dispute as he did, he was still in error in failing to determine the matter as between the employer and the insurer. The insurer was identified in the ARD, and had filed a Reply.
(ii)The Arbitrator erred in identifying error in the parties nominated in the pleadings. The pleadings nominated all appropriate parties, being the employer, the worker, and the insurer. It is submitted strict pleadings are not required in the Commission.
(iii)The Arbitrator erred in considering the principle of subrogation. In this regard it is said the insurer had conceded at a teleconference the matter was properly before the Commission. It is submitted sections 287(1) and 288(1) provide for determination by the Commission of a dispute between an employer and an insurer. It is submitted subrogation would not have application, as such rights cannot be exercised by an insurer until the whole loss insured under the policy is paid out (reference is made to SGIO (Qld) v Brisbane Stevedoring Pty Ltd (1969) 123 CLR 228). It is also submitted the doctrine of subrogation is subject to duties of good faith, which were not the subject of evidence.
(iv)The Arbitrator erred in dismissing the proceedings pursuant to section 354(7A) of the 1998 Act, as that section commenced on 1 November 2006, and the subject proceedings were commenced prior to that date. It is submitted section 354(7A) does not apply in such circumstances; reference is made to section 2(1) of the Workers Compensation Legislation Amendment (Miscellaneous Provisions) Act 2005. It is further submitted the discretion in section 354(7A) was not enlivened, as the matters referred to in sub-sections (a), (b) and (c) of that section were not found to be present. It is also submitted that, even if available, the discretion should not have been exercised. It is said the Arbitrator found a dispute to exist, the Appellant Employer and Respondent Worker were present in Dubbo for the arbitration hearing, the insurer had indicated it did not wish to participate in determination of the dispute, and accordingly the matter should have been dealt with on its merits.
(v)The proceedings were not “misconceived” within the meaning in section 354(7A). The Appellant Employer refers to the meaning of that word in the Shorter Oxford Dictionary.
(vi)The Arbitrator erred in failing to give adequate reasons.
(vii)The Appellant Employer was denied procedural fairness, in that the Arbitrator failed to give the Appellant Employer an opportunity to be heard in respect of the dismissal under section 354(7A). It is also submitted the Arbitrator failed to give the Appellant Employer an opportunity to be heard on the question of costs.

The Notice of Opposition to Appeal lodged on the Respondent Worker’s behalf, disputes the various errors alleged by the Appellant Employer, and seeks the Arbitrator’s decision be confirmed.

ON THE PAPERS REVIEW

Section 354(6) of the 1998 Act provides:

“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”

Neither party seeks to adduce fresh evidence on the appeal. The Respondent Worker submits the appeal can be dealt with on the papers. The Appellant Employer submits there should be an oral hearing. It is submitted one reason for this is that transcript was unavailable when the appeal documents were filed, and there may be a need for further submissions addressing matters arising from the transcript. The Commission forwarded the transcript to the parties’ representatives by letters dated 2 March 2007. Those letters advised final appeal grounds and submissions, which may have been awaiting the transcript, should be completed, lodged and served. Thus, the Appellant Employer has had ample opportunity to put on further material in respect of this appeal, if it wished, since the transcript became available. It is also submitted on the Appellant Employer’s behalf, the appeal raises matters not the subject of prior determination in the Commission, being the right of an employer to put on an ARD in such circumstances, the operation of section 354(7A), and the meaning of “misconceived” in that context.

The Appellant Employer’s submissions address the matters it wishes to put in respect of the appeal. Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submission by the Respondent Worker that the appeal can proceed to be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.

LEAVE

Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act. Section 352 provides:

“352 Appeal against decision of Commission constituted by Arbitrator

(1)       A party to a dispute in connection with a claim for compensation may, with leave of the Commission constituted by a Presidential member, appeal to the Commission as so constituted against a decision in respect of the dispute by the Commission constituted by an Arbitrator.
(1A)     An appeal is to be made by application to the Registrar. The appeal is not to proceed unless the Registrar is satisfied that the requirements of this section and any applicable Rules and regulations as to the making of the appeal have been complied with.
(2)       The Commission is not to grant leave to appeal unless the amount of compensation at issue on the appeal is both:
(a)  at least $5,000 (or such other amount as may be prescribed by the regulations), and
(b)  at least 20% of the amount awarded in the decision appealed against.

(3)       If the Commission refuses to grant leave to appeal, the Commission must state reasons for the refusal in writing to the parties.
(4)       An appeal can only be made within 28 days after the making of the decision appealed against.
(5)       An appeal under this section is to be by way of review of the decision appealed against.
(6)       Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against may not be given on an appeal to the Commission except with the leave of the Commission.
(7)       On appeal, the decision may be confirmed or may be revoked and a new decision made in its place.
Alternatively, the matter may be remitted back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions of the Commission.
(7A) Section 345 of the Legal Profession Act 2004 applies to and in respect of the provision of legal services in connection with an appeal to the Commission under this section in the same way as it applies to and in respect of the provision of legal services in connection with a claim or defence of a claim for damages referred to in that section.
Note. Section 345 of the Legal Profession Act 2004 prohibits a law practice from providing legal services in connection with a claim or defence unless a legal practitioner associate responsible for the provision of those services believes, on the basis of provable facts and a reasonably arguable view of the law, that the claim or defence has reasonable prospects of success.
(8)       In this section, decision includes an award, interim award, order, determination, ruling and direction, but does not include any award, order, determination, ruling or direction of an interlocutory nature prescribed by the regulations.”

The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.

As regards compliance with sub-section (2), the Appellant Employer’s submissions simply submit “The amount of compensation at issue on the appeal exceeds $5,000.00 and represents 100% of the amount at issue such that the requirements of section 352(2) of the WIM are satisfied.”

The Respondent Worker’s submissions deny the threshold in sub-section (2) is satisfied. It is submitted the Respondent Worker has received all of his entitlement to date, and thus there are no outstanding amounts, an award for which could exceed the threshold.

It has been held that, in determining the amount of compensation at issue on an appeal, one must have reference to the amount of compensation at issue in the proceedings before the Arbitrator at first instance: Grimson v Integral Energy [2003] NSWWCCPD 29. “Compensation” is defined in section 4 of the 1998 Act in the following terms:

“compensation means compensation under the Workers Compensation Acts, and includes any monetary benefit under those Acts.”

The ARD purported to claim a weekly sum of $500.00, from 17 March 2005 to date and continuing. Clearly this could not represent a sum the Appellant Employer claimed to be entitled to recover from the Respondent Worker. There would be no conceivable statutory basis for such a claim. Rather, the pleading purported to represent a notional claim by the Respondent Worker. However the Respondent Worker himself made no such claim in the Commission. It is clear, from the pleadings and submissions, the matter proceeded on the basis the Respondent Worker had been paid all benefits to which he claimed to be entitled. The ARD represented a device employed by the Appellant Employer to attempt to get the matter before the Commission for decision, notwithstanding the Appellant Employer’s insurer had not disputed liability. It could have no other function. The material attached to the ARD was not material which, if accepted, would tend to establish an entitlement on the Respondent Worker’s part to compensation. Rather, such material consisted predominantly of statements of witnesses, which may tend to cast doubt on whether the incident of 9 March 2005 occurred as alleged, and if it did, whether there may be other causes for the Respondent Worker’s back condition. Whilst the ARD purported to represent an application for compensation, in reality it was an attempt by the Appellant Employer, to obtain a finding adverse to the position of the Respondent Worker, notwithstanding CGU had not disputed the claim.

The compensation claimed in the ARD did not represent an entitlement the Respondent Worker sought to have awarded to him in these proceedings. In reality, there was no amount of compensation at issue in the proceedings, as the Respondent Worker accepted he had been paid his entitlements. If the proceedings had been dealt with by the Arbitrator, and there had been findings favourable to the Respondent Worker, there would have been no sum to award. It was accepted the relevant benefits had already been paid. The Respondent Worker had no outstanding claim.

As the Appellant Employer has submitted on this appeal, in a different context, strict pleadings are not required in the Commission: Far West Area Health Service v Radford [2003] NSWWCCPD 10. However principles of procedural fairness must be observed: South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16 (‘Edmonds’) at [88]. Section 354(1) of the 1998 Act provides proceedings should be conducted with as little formality and technicality as the proper consideration of the matter permits. Section 354(3) requires the Commission to act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms. It is consistent with such provisions that I look to the reality of the ARD lodged in the matter, in determining whether there was any amount of compensation at issue in the proceedings. There was not.

It has been held that, where no amount of compensation is at issue in an appeal, the appeal does not meet the threshold test in section 352(2): Sullivan v Illawarra Newspapers Holdings Pty Ltd [2006] NSWWCCPD 135; Hunter Area Health Service v Gilbey [2006] NSWWCCPD 136. In my view, this situation prevails in the current appeal. I accept the submission put on behalf of the Respondent Worker, that there were no amounts of compensation outstanding, which could meet the threshold in section 352(2) of the 1998 Act.

It follows that leave to appeal cannot be granted, as the appeal does not satisfy section 352(2).

DISCUSSION AND FINDINGS

If I am wrong in the conclusion I have reached as regards section 352(2), in my view the appeal could not have succeeded in any event. It is appropriate I provide some reasons for this conclusion.

The statutory policy is contained in Form 3 of Schedule 1 to the Workers Compensation Regulation 2003. Clause 3 of the policy provides the insurer is liable, inter alia, for “compensation that the Employer becomes liable to pay under the Act to or in respect of any person who is a worker of the Employer”. Clause 5 makes the insurer directly liable to a worker. Clause 6 provides “The Insurer is bound by and subject to any judgment, order, decision or award given or made against the Employer, in respect of any liability for which the insurer is liable to indemnify the Employer under this Policy.”

Clause 11 provides:

“11 Defence of proceedings

The Insurer can use the name of the Employer in respect of anything indemnified under this Policy, including the bringing, defending, enforcing or settling of legal proceedings for the benefit of the Insurer. The Employer must comply with all reasonable requests by the Insurer for information, assistance and documents to enable the Insurer to settle or resist a claim.”

Clause 24 provides:

“24 Act and regulations form part of Policy
This Policy is subject to the provisions of the Act and the regulations under the Act and those provisions are taken to form part of this Policy.

Clearly the insurer, CGU, was entitled to act, using the name of the Appellant Employer, in dealing with the Respondent Worker’s claim for compensation, that being a matter indemnified under the policy.

The statutory framework within which the Commission obtains jurisdiction pursuant to the 1998 Act, is described by McColl JA in Edmonds, in particular at [61]. The initial step is the making of a claim by the worker, pursuant to section 260. Section 264 imposes certain obligations upon the employer on whom a claim is made, the first of which is to forward it to the insurer within seven days.

Section 274 deals with liability for weekly payments:

“274    Liability to be accepted and weekly payments commenced within 21 days
(1)       Within 21 days after a claim for weekly payments is made the person on whom the claim is made must determine the claim by:
(a)  accepting liability and commencing weekly payments, or
(b)  disputing liability.

Note. Section 283 makes failure to comply with this section an offence. Section 74 requires notice of a dispute to be given.
(2)       An insurer can accept liability for weekly payments on a provisional basis for a period of up to 12 weeks determined by the insurer having regard to the nature of the injury and the period of incapacity.
(3)       The acceptance of liability on a provisional basis operates to extend the period within which the claim must be determined until the end of the period for which liability has been accepted on a provisional basis.
Note. This allows the insurer more time to determine liability while providing for the commencement of weekly payments on the basis of the provisional acceptance of liability.
(4)       Liability cannot be accepted on a provisional basis under this section if the insurer is already making weekly payments on the basis of the provisional acceptance of liability under Division 1 when the claim for weekly payments is made.
(5)       The acceptance of liability on a provisional basis does not constitute an admission of liability by the employer or insurer under this Act or independently of this Act.
(6)       An employer is not required to determine a claim as provided by this section if:
(a)  the employer has duly forwarded the claim to an insurer who the employer believes is liable to indemnify the employer in respect of the claim, and
(b)  the employer has complied with all reasonable requests of the insurer with respect to the claim.

Note. A claim forwarded to the insurer is taken to have been made on the insurer.”

Thus when the claim is made and forwarded to the insurer, in compliance with the employer’s obligations pursuant to section 264, the claim is taken to have been made on the insurer, and the insurer is obliged to either accept or dispute liability. The insurer will do so in the name of the employer, pursuant to clause 11 of the statutory policy, and as the primary liability to pay compensation falls upon the employer, pursuant to section 9 of the 1987 Act.

Section 287(1) of the 1998 Act provides:
“287     Disputes to which Part applies
(1)       This Part applies to a dispute in connection with a claim for compensation between:
(a)  the person who makes the claim and a person on whom the claim is made, or
(b)  the employer on whom the claim is made and the insurer on whom the claim is made.”
Section 288 provides:
“288    Referral of disputes to Commission
(1)       Any party to a dispute about a claim may refer the dispute to the Registrar for determination by the Commission. However, if the dispute is about lump sum compensation, only the claimant can refer the dispute.
Note. A medical dispute concerning the claim can also be referred for assessment under Part 7 (Medical assessment).
(2)       The Registrar may not accept a dispute for referral for determination to the Commission if the dispute is a dispute that, under this Part, cannot be referred for determination by the Commission.”
Section 289 relevantly provides:
“289    Restrictions as to when dispute can be referred to Commission
(1)       A dispute about a claim for weekly payments cannot be referred for determination by the Commission unless the person on whom the claim is made:
(a)  disputes liability for the claim (wholly or in part), or
(b)  fails to determine the claim as and when required by this Act.
Note. The determination of a claim requires the commencement of weekly payments of compensation. The failure to commence weekly payments without having disputed liability constitutes a failure to determine the claim.
…
5)        The Commission may not hear or otherwise deal with any dispute if this section provides that the dispute cannot be referred for determination by the Commission.”
The ARD lodged in this matter asserted weekly benefits compensation was in issue. In my view, no dispute existed susceptible to being referred for determination by the Commission. The Respondent Worker had made a claim upon the Appellant Employer. The Appellant Employer had, consistent with its statutory obligations, forwarded the claim to CGU. CGU, acting in the name of the Appellant Employer pursuant to the statutory policy, had accepted liability, and made payments of compensation in satisfaction of the Appellant Employer’s primary liability under section 9 of the 1987 Act.
The printed form of ‘Application to Resolve a Dispute’, in use at the time the ARD was filed, sought information under the heading “Reason for Dispute”, at “4.1” of “Part 4 Claim Details”, designed to elicit information going to whether the procedural pre-requisites for commencement of proceedings had been satisfied. The Appellant Employer’s difficulties, regarding satisfaction of the procedural requirements, is made apparent by the author’s need to insert a handwritten word into that part of the document (described at [5] above). Even if a dispute did exist, section 289(5) specifically prevented the Commission from hearing or otherwise dealing with it. Consistent with the statutory framework, the matter could not be referred for determination by the Commission, unless the person on whom the claim was made had disputed liability, or failed to determine liability, as required by section 289(1). It had not. Accordingly the Commission did not, in the circumstances, have jurisdiction.
It is unclear if the ARD should be taken as including a notional claim for medical and related expenses pursuant to section 60 of the 1987 Act. That paragraph of the printed form has not been deleted, nor has it been filled in. If the ARD is taken to include such a claim, this does not vary the situation. Section 289(2) prevents such a dispute being referred for determination by the Commission, unless the person on whom the claim was made disputes liability wholly or in part, or fails to determine the claim as and when required by the 1998 Act. This precondition to jurisdiction was not fulfilled.
The Appellant Employer submits, even if it was unable to continue with the proceedings between it and the Respondent Worker, the Arbitrator in any event was in error in failing to determine the matter as between it and CGU. The Commission is bound to afford parties procedural fairness. CGU was not present at the arbitration hearing. Although it had initially lodged a Reply in the proceedings, it had then withdrawn its Reply, as it did not raise any issue concerning injury or liability generally (see [8] above). The ARD did not seek any orders against CGU. There was some coyness at the arbitration hearing regarding the Appellant Employer’s motivation for instituting the proceedings. Its solicitor at one stage said “It may be there may be a large number of reasons for a dispute of this kind. Premiums may or may not be one part of them, but there’s no evidence that it’s a premium dispute.” (T10.10).
Section 289 would, in my view, have been fatal to the continuation of the proceedings in any event. Even if this were not so, there was no issue between the Appellant Employer and CGU, which could have been determined at the arbitration hearing. The ARD sought no orders as between the Appellant Employer and CGU. The only parties nominated in the ARD were the Appellant Employer (described as the ‘Applicant’), and the Respondent Worker (described as ‘the Respondent’). CGU was not a party, nor was it present. It had taken the stance (of which it advised the parties prior to 20 February 2007) it did not need to attend, as it raised no issue regarding injury or liability generally. The Arbitrator could not, consistent with principles of natural justice, have made orders adversely affecting the position of CGU, at the arbitration hearing.
The Appellant Employer also relies upon a ground the Arbitrator failed to give adequate reasons. Given the conclusion I have reached regarding other aspects of the appeal, it is unnecessary I deal with this ground at any length. Suffice it to say, in my view the reasons were sufficient to comply with the Arbitrator’s statutory and common law duty: Rick Damelian Pty Ltd v Romanas [2004] NSWWCCPD 93.
The Appellant Employer also submitted it had been denied procedural fairness, in that it had not been given an opportunity to address the Arbitrator on the dismissal under section 354(7A) of the 1998 Act, or costs. The transcript indicates the Arbitrator made an order pursuant to section 354(7A), and the Appellant Employer’s solicitor then addressed him at some length, in large part regarding the availability of that section as a source of power for the order made. After entertaining these submissions, the Arbitrator expressed the view he had the power, and exercised it. In so far as costs are concerned, costs typically follow the event (as they did in this instance), subject to the restrictions on awarding costs against a worker, which were not of relevance. Given the nature of the order made by the Arbitrator, the award of costs in favour of the Respondent Worker was inevitable. In my view, there is no substance to the argument the Arbitrator denied the Appellant Employer procedural fairness.
The Appellant Employer also raised an issue regarding the availability of section 354(7A) of the 1998 Act, which the Arbitrator took as providing the power he used to dismiss the proceedings. If leave to appeal had been granted, the conclusion I would have reached is one that the Commission did not have jurisdiction in the matter. In circumstances where Commission proceedings have been found to be instituted without jurisdiction, due to failure by a worker to make a claim, orders have been made that the proceedings are a nullity, and should be struck out. An appropriate order, adapted from that made by Roche ADP in Cottons Glass & Aluminium Pty Limited v Handsaker [2006] NSWWCCPD 205, would be in the following terms:
“The proceedings commenced by the Appellant Employer in this matter were commenced in breach of the provisions of the 1998 Act, and as a result are a nullity, as the Commission does not have jurisdiction to hear and determine the matter. The proceedings are struck out.”
Thus, if leave had been granted, and the appeal decided, I would have made an order in the above terms. The availability of section 354(7A) would not have arisen.

DECISION

Leave to appeal is refused.

COSTS

The Appellant Employer is to pay the Respondent Worker’s costs of the appeal.

Michael Snell

Acting Deputy President
9 August 2007

I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF MICHAEL SNELL, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

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