Fairfax Regional Printers Pty Ltd v Workers Compensation Commission of New South Wales - [2007] NSWSC 1087

No judgment structure available for this case.

CITATION: Fairfax Regional Printers Pty Ltd v Workers Compensation Commission of New South Wales & Anor [2007] NSWSC 1087

HEARING DATE(S): 28/09/2007

JUDGMENT DATE :
5 October 2007

JUDGMENT OF: Associate Justice Malpass

DECISION: I grant relief in accordance with paragraph 4 of the First Amended Summons. I reserve the question of costs. The exhibits may be returned. The papers are referred to the Prothonotary for further consideration.

CATCHWORDS: Jurisdiction of the Commission - suitable employment and reinstatement - privative clause

LEGISLATION CITED: Compensation Act 1998 (NSW)
Industrial Relations Act 1996 (NSW)
Supreme Court Act 1970 (NSW)
Workers Compensation Act 1987 (NSW)
Workplace Injury Management and Workers

CASES CITED: Darling Casino Ltd v New South Wales Casino Control Authority (1997) 191 CLR 602
Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168
Ex Parte Transport Workers Union of Australia: Re Gallagher [1964-5] NSWR 1224)
R v Hickman; Ex parte Fox and Clinton (1945) 70 CLR 598
Sullivan v Illawarra Newspapers Holdings Pty Ltd [2006] NSWCCPD 135

PARTIES: Fairfax Regional Printers Pty Ltd v
Workers Compensation Commission of New South Wales
George Shepherd

FILE NUMBER(S): SC 30176/06

COUNSEL: Mr J. N. West QC / Mr J. Lichtenberger (Pl)
Ms. S. Ryan (Sol) (2nd Def)

SOLICITORS: Hicksons Solicitors (Pl)
Turner Freeman (2nd Def)

LOWER COURT JURISDICTION: Workers Compensation Commission

LOWER COURT FILE NUMBER(S): WCC 8024-2006

LOWER COURT JUDICIAL OFFICER : Arbitrator Dupont

LOWER COURT DATE OF DECISION: 08/12/2006

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IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION

ASSOCIATE JUSTICE MALPASS

5 OCTOBER 2007

30176/06 Fairfax Regional Printers Pty Ltd v Workers Compensation Commission of New South Wales & Anor

JUDGMENT

1 HIS HONOUR: The second defendant was an employee of the plaintiff. He suffered injury either on his way to or on his way home from work (on 4 October 2005). He was in receipt of workers compensation. His employment was terminated on 10 May 2006 because of his unfitness to perform suitable duties for at least another three months.

2 On 25 May 2006, the second defendant filed an application to resolve a workplace injury management dispute (the application) in the Workers Compensation Commission (the Commission). The application requested the Commission to use its jurisdiction to make orders pursuant to Chapter 3 of the Workplace Injury Management and WorkersCompensation Act 1998 (NSW) (the WIM Act) which included an order for the worker to be reinstated. The application also alleged a failure to provide suitable employment in accordance with obligations under s49 of the WIM Act. Concurrently with those proceedings, he brought and maintained proceedings in the Australian Industrial Relations Commission (AIRC). In those proceedings, he also sought, inter alia, reinstatement.

3 The plaintiff filed a reply to the application. It raised the question of jurisdiction. The reply contained, inter alia, the following:-

“1. Whether the Workers Compensation Commission has jurisdiction to consider a workplace injury management dispute where the worker has been terminated.

2. Whether the Workers Compensation Commission has jurisdiction to direct reinstatement of an employee where employment has been terminated.

3. The employer/insurer maintains it has complied with the duties to offer suitable duties within the provisions of the Act.”

4 An Arbitrator (Ms. Dupont) was appointed. She presided at a hearing on 19 September 2006 (she explained it as “moving into a formal arbitration in regards to this matter”). What took place was recorded and the Court has a copy of the transcript before it. At that time the ARIC proceedings were on foot and two days had been set aside for hearing in the near future.

5 Before her, the jurisdictional question was raised by the plaintiff and the Arbitrator took the course of proceeding to hear submissions on it. The transcript records [at p5 line 44]:-

“Arbitrator: Mmm. Okay. All right. Okay. So, we will proceed to submissions on the jurisdictional issue. So Ms Ryan, are you going to make those submissions?”

6 At 2.32pm the Arbitrator took a short adjournment to consider her decision on what she referred to as “the jurisdictional matter”. She resumed at 3.55pm. Thereafter, she observed as follows [at p21 line 36]:-

“Yeah. Although I’m giving an extempore decision on this matter, I am going to provide written reasons in detail, probably more detail that (sic) is required because I think it is quite a complicated matter. But what I found is this Commission does have jurisdiction to determine the case, that is, about suitable duties, and basically I’m persuaded by the interpretation of the Act as presented to me today by the applicant, and very briefly I’m going to just give you my reasons.”

“(4) A worker is to be regarded as suitably employed if:

(a) the worker’s employer provides the worker with, or the worker obtains, suitable employment, or

Industrial Relations Act 1996

“So the applicant is seeking that the respondent provide suitable duties and that those be in accordance with the injury management plan and medical orders, and that is, in fact, I think what is intended by the changes to the legislation. That is, in fact, good practice for the employer and that is the order that I will make, or that is the order that I am making.”

7 The confusion that was created by these observations was never clarified during what took place thereafter. Following those observations, the plaintiff made application that she disqualify herself on the ground of bias. The Arbitrator refused to disqualify herself. She rejected an application made by the plaintiff that the leave of the President of the Commission should be sought on questions of law (including the question of jurisdiction). It was made pursuant to s351 of the WIM Act. A further application for disqualification was also refused

8 In the course of the discussion that followed with Counsel for the plaintiff, the Arbitrator observed that she could not make a finding on the jurisdictional issue without dealing first with what she referred to as s47(3)(a) (this was later corrected to read s49). This prompted a request for clarification from Counsel for the plaintiff.

9 The transcript records the following [at p31 line 23]:-

“Mr Lichtenberger: So, there’s just something that you said a moment ago that I think for the purposes of the record needs to be clarified, and it’s this: that at the outset, it was made clear that we were considering the question of jurisdiction.

Arbitrator: Mm-mm. That’s correct.”

10 Counsel for the plaintiff then sought, and was granted, a short adjournment to get instructions. Upon his return, an application was made for an adjournment for about 21 days. Discussion then took place concerning that application. The adjournment application was sought for two reasons. One concerned an opportunity to consider the foreshadowed written reasons of the Arbitrator. The second concerned the hearing before the AIRC, which was set down to take place during the proposed adjournment period (27 and 28 September 2006).

11 The Arbitrator did not embrace that application. There was discussion concerning a shorter period (10 days) and an application to the Registrar for an extension of time. An indication was given by her that she would speak to the Registrar. The hearing concluded at eight minutes past five on that basis. The result seems to be that it concluded in a state of some uncertainty. Be that as it may, there was an expectation that the foreshadowed written reasons on the jurisdictional question would be handed down.

12 By letter dated 8 December 2006, the plaintiff was advised that the application had been determined by the Commission. The letter enclosed, inter alia, a document headed “Statement Of Reasons – Extempore Orders”. Rather than provide reasons for the orders set forth therein, the document referred to what had been said orally at the arbitration hearing. Save for her indication of s49 being the source, it is unclear from what was said orally how she came to the view that she had jurisdiction. The document contained also, inter alia, the following:-

“The orders made are as follows:

1. Pursuant to s49 of the Workers Compensation Act 1987 the Respondent is to provide the suitable duties to the applicant thought would be in accordance with the Injury Management Plan and medical orders.

2. The Respondent pays the Applicant’s costs as agreed or assessed” (the orders).

13 I digress to observe that Order 1 is in terms that may be thought to be both incomprehensible and incapable of implementation.

14 The letter also enclosed written reasons for the decision on the application to refer a matter of law to the President. There is material contained in the reasons which does not accord with what in fact happened and was recorded in the transcript.

15 On 22 December 2006, proceedings were commenced in this Court seeking judicial review pursuant to s69 of the Supreme Court Act 1970 (NSW). The plaintiff now proceeds on a First Amended Summons filed on 6 March 2007. The relief sought therein includes the following:-

“1. A declaration that upon the proper construction of the Workplace Injury Management and Workers Compensation Act 1998 and the Industrial Relations Act 1996 and the events which have happened, the Workers Compensation Commission of New South Wales (Arbitrator Dupont) was without jurisdiction to make any order purportedly under s49 of the said Act or at all whereby the plaintiff was required to provide employment or duties to the second defendant.

2. A declaration that upon the proper construction of the Workplace Injury Management and Workers Compensation Act 1998 and the Industrial Relations Act 1996 and the events which have happened, the Workers Compensation Commission of New South Wales (Arbitrator Dupont) was without jurisdiction to make any order in the nature of reinstatement or re-employment in favour of the second defendant.

3. A declaration that, consequentially upon orders (1) and/or (2) hereof, the Workers Compensation Commission of New South Wales (Arbitrator Dupont) was without jurisdiction to make any order As to the costs of the proceedings before her, against the plaintiff.

4. Order that there be removed into the Court the record of matter number 8024-06 before the Workers Compensation Commission of New South Wales for the purpose quashing orders 1 and 2 made by Arbitrator Dupont either on 19 September 2006 and confirmed by Arbitrator Dupont on 8 December 2006, and made on 8 December 2006.”

16 The hearing took place on 28 September 2007. The plaintiff was represented by Counsel (including Senior Counsel). Extensive written submissions were made on its behalf and these submissions were supplemented by oral argument. No submissions were made on behalf of either defendant. Both filed submitting appearances. Ms. Ryan, who appeared on behalf of the second defendant was present in Court during the hearing.

17 The Arbitrator looked to s49 of the WIM Act as the source of the jurisdiction purportedly exercised by her. Her first order was expressly made pursuant to it. Section 49 is part of Chapter 3, which is headed “Workplace injury management”. This was the Section and Chapter relied on also by the second defendant.

18 Section 49 is headed “Employer must provide suitable work”. Section 49 imposes certain duties upon the employer liable to pay compensation to the worker under the WIM Act in respect of the injury (inter alia, to provide suitable employment as defined in s43A of the WC Act). It is expressed not to apply in the circumstances set forth in (a), (b) and (c) of subs(3) thereof. These exclusions are regarded by the plaintiff as being presently irrelevant. The exclusion provided by (c) is one where the employer has terminated the worker’s employment after the injury happened, other than for the reason that the worker was not fit for employment as a result of the injury.

19 Section 49 is not a provision that confers jurisdiction (be it on the Commission or otherwise). The sanction for non-compliance by an employer is dealt with in s56. Compliance with the requirements of Chapter 3 is made a policy of insurance condition and may be dealt with by the payment of an amount by way of a premium surcharge.

20 Division 3 of Part 5 of Chapter 7 confers jurisdiction in relation to disputes about non-compliance with Chapter 3. Division 3 is comprised by ss305-310. Section 305 provides that Division 3 applies in respect of a dispute that concerns a failure by a party to the dispute to comply with an obligation imposed by or under Chapter 3. Section 306 sets out the ways in which such a dispute can be dealt with. It provides the Registrar with four courses of action. (two ways by which a Registrar may deal with the dispute are by referring the dispute to the Authority or by making a recommendation as provided for in Division 3). There is a note at the foot of this section that reads “The Registrar can refer the dispute to the Commission for determination if action under this Division is not successful”. Section 307 enables a Registrar to deal with a dispute by recommending that a party take specified action. Section 308 concerns “Compliance with recommendations of Registrar” (under this provision a party to the dispute to whom a recommendation has been made by the Registrar may request the Registrar to refer the dispute to the Commission for determination). Section 310 provides that if a dispute is referred to the Commission for determination, the Commission may make orders with respect to any matter that can be the subject of a recommendation by the Registrar under the division.

21 It is unclear what happened in the Commission during the period between the application and the arbitration hearing and how the matter came to be before the Arbitrator. The material does not suggest any involvement of the Registrar in the matter (inter alia, by making any recommendation or referral to the Commission). It mentions a work plan devised by A W Workwise on 20 December 2005, which was to take effect on 5 January 2006 and to cease approximately, at the end of March 2006 and the second defendant not being given an opportunity by the plaintiff to return to work in accordance with that plan. This appears to be the basis upon which the application was filed.

22 In the present case, it is unnecessary to pursue a question of the powers that may be conferred by Division 3. The procedures prescribed by Division 3 for dealing with disputes that concern a failure by a party to such a dispute to comply with an obligation imposed by or under Chapter 3 were not pursued. The Arbitrator saw herself as being involved in a formal arbitration. She did not look to Division 3 as a source of jurisdiction. Whatever had to be done to invoke jurisdiction conferred by Division 3 did not take place.

23 What has already been said herein suffices to dispose of questions of jurisdiction. I consider that the Arbitrator did not have jurisdiction to make the first order. The second order was merely ancillary to it.

24 Leaving aside questions of jurisdiction, there is another matter that I should mention. There was a clear denial of procedural fairness. The Arbitrator came to make the orders in circumstances where she should have been considering the question of jurisdiction only. She denied the plaintiff of the opportunity of being heard on the question of the making of such orders. This appears to have been done both blatantly and deliberately. It seems to me to be a matter that should be referred to the prothonotary for further consideration.

25 Before both the Arbitrator and this Court, the plaintiff ventilated the jurisdictional argument that the Commission had no power of reinstatement. It was said that such a power was had only by the Industrial Relations Commission. The plaintiff relied on the termination of the employment prior to the commencement of the proceedings in the Commission. It was said that the powers of the Commission were restricted to those cases where the employment remained on foot. It is an argument that does not have to be dealt with in this case and seems to me better left for another occasion, when there can be full argument by both sides.

26 However, in deference to what has been said by Counsel, I will briefly mention some of the matters that were put.

27 The Court was taken to the definition of “worker”. Section (5) defines it to mean a person who has entered into or works under a contract of service, or a training contract, with an employer. The plaintiff stresses what it sees as being the use of the present tense.

28 At the relevant time, jurisdiction for reinstatement was conferred by the Industrial Relations Act 1996 (NSW) on the Industrial Relations Commission (in cases where the worker had been dismissed by reason of unfitness for work because of incapacity for which workers compensation was available).

29 The plaintiff draws attention to the note to s49 of the WIM Act. It concludes with the following:-

Note.

Industrial Relations Act 1996

30 In the proceedings before the Arbitrator, the plaintiff relied on what was said in Sullivan v Illawarra Newspapers Holdings Pty Ltd [2006] NSWCCPD 135. The obiter dicta in that case was also drawn to the attention of this Court.

31 By way of completeness, it may be added that in November 2006, the “Injured worker reinstatement provisions” were removed from the NSW Act and placed into a new Part 8 of the Workers Compensation Act 1997. Despite that, the jurisdiction for reinstatement continued to remain with the Industrial Relations Commission.

32 Whilst it may be correct to say that the Commission has no power of reinstatement, the issue at large is whether or not there is a duty pursuant to s49 to provide suitable employment to a worker whose employment has been terminated. As has already been said, s49 imposes a duty to provide suitable employment upon an employer who is liable to pay compensation to the worker under the Act in respect of his injury.

33 Before proceeding to the question of considering what relief should be granted, it is necessary to address one further matter which has been properly brought to the attention of the Court by the plaintiff.

34 Section 350 of the WIM Act is what is described as a privative clause. There is well-established authority that such a provision does not take away the jurisdiction had by this Court (and which is now the subject of s69) where a Commission is purporting to act without jurisdiction (see, inter alia, Ex Parte Transport Workers Union of Australia: Re Gallagher [1964-5] NSWR 1224). The Courts have repeatedly applied that which is referred to as the Hickman principle (R v Hickman; Ex parte Fox and Clinton (1945) 70 CLR 598 at 614-616). See also Darling Casino Ltd v New South Wales Casino Control Authority (1997) 191 CLR 602 and Deputy Commissioner of Taxation v Richard Walter Pty Ltd (1995) 183 CLR 168. The Hickman principle is a rule of construction which deals with the need to reconcile conflicting provisions in a Statute. The three conditions of it, in this case, are as follows:-

‘1. That the Arbitrator made a bona fide attempt to exercise the powers of the Commission;

2. That the orders made by her relate to the subject matter of the WIM Act; and

3. That the orders made by her are reasonably capable of reference to the powers given to the Commission.’

35 Before concluding this judgment, it may be appropriate to mention one further matter. If the dispute between the parties does find its way back to the Commission, it seems to me that it should be before a different arbitrator.

36 The relief that is sought is in the terms as set forth in the First Amended Summons (paragraphs 1-4). In the circumstances of this case, it suffices to grant relief in accordance with paragraph 4 thereof. I reserve the question of costs. The exhibits may be returned. The papers are referred to the Prothonotary for further consideration.

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- 12 -
IN THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISION