Edwards v David Brown Gear Industries Limited

[1999] NSWCA 375

CITATION:	EDWARDS v DAVID BROWN GEAR INDUSTRIES LIMITED [1999] NSWCA 375
FILE NUMBER(S):	CA 40810/98
HEARING DATE(S):	14 September 1999
JUDGMENT DATE:	29 October 1999
PARTIES :	Graham Edwards - Appellant David Brown Gear Industries Limited - Respondent
JUDGMENT OF:	Meagher JA at 1; Sheller JA at 2; Fitzgerald JA at 23

LOWER COURT JURISDICTION:	Compensation Court
LOWER COURT FILE NUMBER(S) :	12981/96
LOWER COURT JUDICIAL OFFICER:	Burke CCJ

COUNSEL:	Appellant - In Person Respondent - R A Stanton
SOLICITORS:	Appellant - In Person Respondent - Hickson & Wisewoulds
CATCHWORDS:	WORKERS COMPENSATION - effect of Pt 14 cl 1 of Workers Compensation Act 1987 on s63 of Workers Compensation Act 1926 - whether claim for compensation for injury the subject of earlier settlement is barred; WORKERS COMPENSATION - whether consent award gave rise to issue estoppel or res judicata where award was for lump sum and where new claim was for weekly compensation
ACTS CITED:	Compensation Court Act 1984 Workers Compensation Act 1987 Workers Compensation Act 1926
CASES CITED:	Blair v Curran (1939) 62 CLR 464 Logwon Pty Ltd v Warringah Shire Council (1993) 33 NSWLR 13 De L v Director General, New South Wales Department of Community Services [No 2] (1997) 190 CLR 207 Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589
DECISION:	1. Appeal allowed in part; 2. Set aside the award of Judge Burke of 2 October 1998 in so far as the amended application for determination sought weekly compensation for the 5 per cent loss of use of the left arm due to work conditions during the period up to 6 August 1980; 3. Remit the determination of the amended application for weekly compensation for the 5 per cent loss of use of the left arm due to work conditions during the period up to 6 August 1980 to the Compensation Court; 4. Otherwise dismiss the appeal; 5. No order as to the costs of the appeal.

THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40810/98
CC 12981/96

MEAGHER JA
SHELLER JA
FITZGERALD JA

EDWARDS v DAVID BROWN GEAR INDUSTRIES LIMITED

The appellant had sought awards in the Compensation Court against the respondent in respect of an injury to his back and a separate injury to his arm arising out of or in the course of his employment by the respondent. For each injury the appellant sought a lump sum award pursuant to s66 and weekly compensation under Part 3 Division 2 of the Workers Compensation Act 1987 (the 1987 Act).

The appellant had made an earlier claim against the respondent in respect of the arm injury in the Compensation Court, which was determined against him. The back injury was also the subject of earlier proceedings under the Workers Compensation Act 1926 (the 1926 Act) which were settled.

In its defence the respondent asserted that the appellant was estopped by reason of the principles of res judicata and issue estoppel from maintaining the claims in the proceedings.

The trial Judge dismissed the proceedings. The appellant appealed from this decision.

Held:

By Sheller JA, Meagher and Fitzgerald JJA agreeing:
(1) With regards to the back injury which was the subject of a settlement, the appellant lost any entitlement to any compensation for this injury under the 1926 Act other than compensation paid to him before judgment, pursuant to s63 of the 1926 Act. The effect of Pt 14 cl 1 of the 1987 Act was that s63 applied to deny the appellant any right to claim compensation under the 1926 Act and extended to deny any such right under the 1987 Act. Accordingly, the trial Judge was correct in making a determination in favour of the respondent on this part of the application.
(2) The claim in respect of the arm injury was merged into the consent award made by the Senior Commissioner of the Compensation Court. The joint request of the parties gave the award a judicial sanction and coercive authority to which the parties agreed and thus converted an agreement into a judicial decision on which a plea of res judicata may be founded.
(3) The consent award was not concerned with any claim by the appellant for weekly payments. Such claim had not been determined by any court. The trial Judge gave no reason for rejecting the claim other than to say that the order of the Senior Commissioner was final.

By Sheller JA, Meagher JA agreeing, Fitzgerald JA dissenting:
(4) The claimed entitlement for weekly compensation may have extended to a period after the consent order was made. The amended application for weekly compensation for the arm injury should be remitted to the Compensation Court for re-determination.

Per Fitzgerald JA:

(1) The appellant’s claim for weekly compensation in respect of the arm injury was fundamentally inconsistent with the Compensation Court’s consent award and was not open to the appellant. While the trial Judge did not adequately explain his decision, it was futile and wasteful of the Compensation Court’s time and resources and oppressive to the respondent to remit for re-determination an application which must fail.

Blair v Curran (1939) 62 CLR 464
Logwon Pty Ltd v Warringah Shire Council (1993) 33 NSWLR 13
De L v Director General, New South Wales Department of Community Services [No 2] (1997) 190 CLR 207
Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589

ORDERS

1. Appeal allowed in part;

2. Set aside the award of Judge Burke of 2 October 1998 in so far as the amended application for determination sought weekly compensation for the 5 per cent loss of use of the left arm due to work conditions during the period up to 6 August 1980;

3. Remit the determination of the amended application for weekly compensation for the 5 per cent loss of use of the left arm due to work conditions during the period up to 6 August 1980 to the Compensation Court;
4. Otherwise dismiss the appeal;
5. No order as to the costs of the appeal.
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THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40810/98
CC 12981/96

MEAGHER JA
SHELLER JA
FITZGERALD JA

Friday, 29 October 1999

EDWARDS v DAVID BROWN GEAR INDUSTRIES LIMITED

JUDGMENT

1    MEAGHER JA: I agree with Sheller JA.

2    SHELLER JA: The appellant, Mr Graham Edwards, appeals from a decision of His Honour Judge Burke of 2 October 1998 in which, on the appellant’s amended application for determination, his Honour made an award for the respondent, David Brown Gear Industries Limited. On 26 February 1998 the appellant filed the amended application for determination which was further amended consequent upon an order of his Honour Judge Davidson of 6 July 1998. So far as relevant to this appeal, the appellant sought awards against the respondent in respect of two injuries arising out of or in the course of his employment by the respondent.

3 The first injury was said to have occurred on 28 July 1980 when the appellant lifted a 95 kilogram fly wheel, sprained his lower back and was, in consequence, partially paralysed. The second injury which was said to be due to work conditions during the period up to 6 August 1980, when the appellant ceased to work for the respondent, resulted in a 5 per cent loss of the use of his left arm. For each injury the appellant claimed a lump sum award pursuant to s66 of the Workers Compensation Act 1987 (the 1987 Act) and weekly compensation under Division 2 of Pt 3 of the 1987 Act.

4    In its second amended answer filed on 12 August 1998, amongst other defences, the respondent asserted that the appellant was estopped by reason of the principles of res judicata and issue estoppel from maintaining the claim in the proceedings. The respondent particularised proceedings in the Compensation Court, CR5930 of 1987, which the appellant brought against the respondent for compensation in respect of the injury to the left arm. These proceedings were determined by an award in favour of the respondent.

5    On the present application Judge Burke made an award for the respondent on the appellant’s claim for the first injury because the appellant had already recovered damages for this injury to his back in proceedings he began in the District Court in 1986. In those proceedings the appellant claimed to recover from the respondent damages for negligence allegedly the cause of the injury that he suffered on 28 July 1980 as a result of lifting the fly wheel. Those proceedings were settled. By consent and without admission of liability judgment was entered for the appellant in the sum of $3,000 with each party to pay its own costs. The terms of settlement were signed by the appellant and dated 21 November 1986. Judge Burke said:

“You have recovered damages in respect of the injuries sustained at David Brown Gear Industries Limited on 28 July 1980 for your back. Therefore, you cannot get compensation. As a matter of law, you cannot get compensation.”

6    As to the second injury, on 19 November 1987 the appellant had made the previously referred to application for compensation in the Compensation Court (CR 5930 of 1987). The period of injury was said to be from June to August 1980. The nature and severity of the injury was described by the appellant as permanent partial disability of left arm. The appellant claimed “5 per cent permanent partial disability of left arm” but made no claim for weekly compensation.

7    On 7 June 1988 Senior Commissioner Muirhead “having duly considered the matters submitted and by and with the consent of the parties hereto” ordered that there be an award in favour of the respondent.

8    In his reasons for judgment, Judge Burke said:

“As far as the arm is concerned, there is the award of Senior Commissioner Muirhead in a claim by you against the current respondent for injury to the left arm. It does not matter whether it is by consent or whether it is not, it is an order of the Court and it is final. I am not interested in the statement; I’m interested in the law. If you had seen a lawyer, they would have told you it was hopeless in the first place.”

9    The “statement” or one of the statements Judge Burke referred to may have been that dated 9 September 1998 and headed “Matter CR 5930 of 1987 before Commissioner Muirhead on 7/6/88 David Brown Gear Industries Limited Respondent Statement by Applicant”. The appellant had hand-printed and signed the statement. The statement was:

“Upon offering a cheque for said sum as in letter from MMI dated 24/11/87, Mr Urquart, Claims Manager for MMI Insurance Ltd upon Respondent’s Counsel Mr Small approaching applicant. In the Courtroom, Mr Urquart later stated before Commissioner Muirhead that some employer later over the years was liable for said disability of left arm for the section (66) award. Applicant had erred in law by agreeing that some later employer was liable for payment of the award before Commissioner Muirhead who adjourned the matter by consent of both parties. The matter was not adjudged, nor any reasons of judgment given by Commissioner Muirhead. However, in fact and law, this is not so as to liability for the section (66) award.”

10    During the hearing of the appeal Mr Edwards stated from the bar table that no money had been paid to him in consideration of his consenting to an award for the respondent. He suggested that he had refused any payment because he believed that his injuries arose out of or in the course of employment by “a more recent employer or employers”.

11    Mr Edwards’ grounds of appeal are not easy to follow. Clearly he claimed that Judge Burke had erred in law, that Judge Burke failed to accept further medical evidence, that there was some “further different injury” or “same and further different injury”, that Judge Burke failed to overturn the consent award by Senior Commissioner Muirhead and that there was an aggravation of work injuries with other employers which had originated “within the employ of this respondent”.

12    The red appeal book which the appellant has filed contained some affidavit material and medical panel certificates which are irrelevant to any consideration of the correctness or otherwise of Judge Burke’s decision.

13    The appellant relies upon findings made in separate proceedings against other employers by Chief Judge McGrath and Judge Burke. In a page from the reasons for judgment said to be of 12 December 1989 in one of those matters, Chief Judge McGrath indicated that the injury there claimed for originated while the appellant was working with the respondent. In a page of the reasons for judgment said to be of 12 December 1990 Judge Burke said that the back problem for which the claim was being made had its genesis in employment other than with the employer respondent to those proceedings. The medical material provided refers to separate injuries to the left hand and left leg which occurred before the appellant was employed by the respondent.

14    The appellant’s 1980 back injury occurred when the Workers Compensation Act 1926 (the 1926 Act) was in force. Section 63 of the 1926 Act provided:

“(1) Nothing in this Act shall affect any civil liability of the employer where the injury was caused by the personal negligence or wilful act of the employer or of some person for whose act or default the employer is responsible.
(2) In such case the worker may proceed both under this Act and independently of this Act but where in proceedings independently of this Act he accepts money brought into court by his employer or he obtains judgment against his employer he shall not be entitled to any compensation under this Act other than compensation paid to him before such acceptance or judgment.”

15    On 21 November 1986 when the terms of settlement were agreed and judgment entered to take effect from that date, the appellant lost any entitlement to any compensation for this injury under the 1926 Act other than compensation paid to him before judgment. The 1987 Act, s281 and Sch 5, repealed the 1926 Act. Part 5 of the 1987 Act deals with common law remedies. In particular, s151A (2) denies a person entitlement to both compensation for non-economic loss in respect of an injury and to damages in respect of the injury from the employer liable to pay the compensation and requires the person to make an irrevocable election which will be claimed. Section 151B (1) provides, subject to exceptions not here material:

“If a person recovers damages in respect of an injury from the employer liable to pay compensation under this Act:
(a) the person then ceases to be entitled to any further compensation under this Act in respect of the injury concerned (including compensation claimed but not yet paid), and
(b) the amount of any compensation already paid in respect of the injury concerned is to be deducted from the damages (awarded or otherwise paid as a lump sum) and is to be paid to the person who paid the compensation.”

16    Schedule 6 Pt 14 cl 1 of the 1987 Act provides as follows:

“Abolition of common law actions not to apply to existing injuries
(1) Part 5 of the Act (except section 151AA) does not apply to a cause of action in respect of :
(a) an injury received by a worker before 4 pm on 30 June 1987, or
(b) the death of a worker resulting from or caused by such an injury.
(2) In the case of any such cause of action, the provisions of sections 63, 64 and 64A of the former Act continue to apply.
(3) In the application of those provisions of the former Act, a reference in those provisions to compensation or proceedings under the former Act includes a reference to compensation or proceedings under this Act.
(4) For the avoidance of doubt, those provisions of the former Act apply and are taken always to have applied to the recovery of compensation or damages, whether or not the compensation or damages were paid under an award or judgment. For example, compensation or damages may be paid under an agreement.”

“Former Act” is the 1926 Act; s3.

17    The effect of Pt 14 cl 1 is that s63 of the 1926 Act still applies to deny to the appellant any right to claim compensation under the 1926 Act and extends to deny any such right under the 1987 Act for the back injury that he suffered on 28 July 1980. In my opinion, there can be no doubt whatever that on this part of the application for determination before Judge Burke there must have been an award in favour of the respondent and to the extent to which the appeal challenges such an award it must fail. This flows from the terms of the statutes and the judgment made pursuant to the terms of settlement. It cannot be affected by any evidence, medical or otherwise, that Mr Edwards placed before Judge Burke. In particular, any reliance that the appellant placed upon s151A of the 1987 Act was misconceived. It is a section in Pt 5 made inapplicable to the appellant’s July 1980 back injury by cl 1 of Pt 14 of Sch 6, particularly sub-cl (1).

18    In Blair v Curran (1939) 62 CLR 464 at 532 Dixon J said:

“The distinction between res judicata and issue-estoppel is that in the first the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment, so that it is merged and has no longer an independent existence, while in the second, for the purpose of some other claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order.
Nothing but what is legally indispensable to the conclusion is thus finally closed or precluded. In matters of fact the issue-estoppel is confined to those ultimate facts which form the ingredients in the cause of action, that is, the title to the right established. Where the conclusion is against the existence of a right or claim which in point of law depends upon a number of ingredients or ultimate facts the absence of any one of which would be enough to defeat the claim, the estoppel covers only the actual ground upon which the existence of the right was negatived. But in neither case is the estoppel confined to the final legal conclusion expressed in the judgment, decree or order. ……Matters cardinal to the latter claim or contention cannot be raised if to raise them is necessarily to assert that the former decision was erroneous.”

19    So far as the appellant’s claim for a lump sum for the injury to his left elbow suffered during the course of his employment by the respondent, the claim is merged in the consent award made by the Senior Commissioner on 7 June 1988. It matters not that the award was a consent award. The joint request of the parties gave the award a judicial sanction and coercive authority to which the parties agreed and thus converted an agreement into a judicial decision on which a plea of res judicata may be founded; see generally Spencer Bower Turner & Handley, The Doctrine of Res Judicata, 3rd ed (1996) at 21 para 38.

20    Mr Edwards relies upon the statement which I have already quoted apparently in support of a claim that the order was consented to as a result of a mistake. The mistake seems to have been Mr Edwards’ concession that he suffered no injury to his left elbow arising out of or in the course of his employment by the respondent. It is true that in later claims he made against other employers apparently in respect of the same injury he failed and the reason was given that the injury must have been suffered while he was employed by the respondent or some other employer not party to the particular proceedings. On the material, so far as we are aware of it, placed before Judge Burke, there is nothing to lead me to the conclusion that there is any prospect that Mr Edwards would succeed in having the consent award set aside. However that may be, the application before Judge Burke was not one to have the award made by Senior Commissioner Muirhead set aside. The power of a court to make such an order and the procedure for doing it was discussed by this Court in Logwon Pty Limited v Warringah Shire Council (1993) 33 NSWLR 13; see also De L v Director General, New South Wales Department of Community Services [No 2] (1997) 190 CLR 207 at 215 and following. Section 17 (3) and (4) of the Compensation Court Act 1984 provides as follows:

“(3) Subject to Part 4 of this Act, a decision or proceeding of the Court shall not:
(a) be vitiated by reason of any informality or want of form, or
(b) be liable to be challenged, appealed against, reviewed, quashed or called in question by any court.
(4) Nothing in subsection (3) shall prevent the Court from reconsidering any matter which has been dealt with by it, or from rescinding, altering or amending any decision previously made or given by the Court, all of which the Court shall have authority to do.”

21    The consent award was not concerned with any claim by Mr Edwards for weekly payments. Such a claim has not been determined by any court. It is arguable that the consent award gave rise to an issue estoppel on the basis, as apparently conceded by the appellant, that the injury was not one arising out of or in the course of his employment by the respondent or on the basis that the injury was not suffered by the appellant. Judge Burke gave no reason for rejecting the claim for weekly compensation beyond saying that the order of Senior Commissioner Muirhead was an order of the court and was final. For all we know the claimed entitlement for weekly compensation may, as alleged, extend to a period after the consent order was made. Judge Burke may have had in mind an Anshun estoppel; Port of Melbourne Authority v Anshun Pty Limited (1981) 147 CLR 589. If so, he did not mention it.

22    In my opinion, the following orders should be made:

1. Appeal allowed in part;
2. Set aside the award of Judge Burke of 2 October 1998 in so far as the amended application for determination sought weekly compensation for the 5 per cent loss of use of the left arm due to work conditions during the period up to 6 August 1980;
3. Remit the determination of the amended application for weekly compensation for the 5 per cent loss of use of the left arm due to work conditions during the period up to 6 August 1980 to the Compensation Court;
4. Otherwise dismiss the appeal;
5. No order as to the costs of the appeal.

23    FITZGERALD JA: The circumstances giving rise to this appeal are set out in the reasons for judgment of Sheller JA. Subject to one matter, I agree with his Honour’s conclusions, and with his reasons.

24    The foundation of the appellants’ present application for lump sum and weekly compensation is an alleged permanent 5% loss of use of his left arm during the period of his employment by the respondent from May to 6 August 1980.

25    I cannot identify any matter of fact or law which the appellant would have had to establish to obtain an award for lump sum compensation in respect of the same alleged disability on his application of 19 November 1987 which he would not have to establish to obtain an award on his current application.

26    The appellant’s application of 19 November 1987 was dismissed by the Compensation Court’s consent award on 7 June 1988.

27    The appellant’s current application for weekly compensation in respect of his alleged 5% permanent loss of use of his left arm cannot be maintained in relation to the period from 6 August 1980 to 19 November 1987 because of issue estoppel arising out of the consent award of the Compensation Court on 7 June 1988. Blair v Curran (1939) 62 CLR 464, 532.

28    I have taken into account that it is theoretically possible that the appellant’s alleged permanent 5% loss of use of his left arm developed, or first affected his earning capacity, after 19 November 1987, and assumed that, were that asserted, he might not be estopped by the Compensation Court’s consent award on 7 June 1988 from pursuing his current claim for weekly compensation in relation to the period after 19 November 1987.

29    However, that is not the appellant’s case. On the contrary, he claims that his alleged permanent 5% loss of use of his left arm was sustained during his employment by the respondent between May and 6 August 1980 and reduced his earning capacity prior to 19 November 1987, if not immediately after 6 August 1980.

30    That claim is fundamentally inconsistent with the Compensation Court’s consent award of 7 June 1988, and is not open to the appellant.

31    The extent of my disagreement with Sheller JA is extremely narrow, and can be briefly explained. While I agree that the Compensation Court did not adequately explain its decision, I consider it futile and wasteful of the Compensation Court’s time and resources, and oppressive to the respondent to remit for redetermination an application which I consider must fail.

32    I would dismiss the appeal, with costs.

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