Glenda Rosemary Hackett v the Workers Rehabilitation and Compensation Corporation No. SCGRG 94/232 Judgment No. 4707 Number of Pages 11 Workers' Compensation
[1994] SASC 4707
•28 July 1994
COURT IN THE FULL COURT OF THE SUPREME COURT OF SOUTH AUSTRALIA MOHR(1), DEBELLE(2) AND NYLAND(2) JJ
CWDS
Workers' compensation - appeal from Workers Compensation Appeal Tribunal - appellant sought commutation of weekly compensation payment - legislative amendment refusing appeals from decisions of Corporation not to allow commutation of payments - amendment stated to have retrospective effect - whether retrospectivity extends to applications to commute which have been determined but are subject to review or appeal - Parliament found not to have intended to alter the rights of parties pending appeal - appellant able to commute a portion of her entitlement to weekly payments - appeal allowed. Workers Rehabiltiation and Compensation Act, 1986s.42. Abbott v Minister for Lands (1895) AC 425; Continental Liquors Pty Ltd v GF Heublin and Bro. Inc
(1960) 103 CLR 422; Robertson v Shire of Nunawading (1973) VLR 819; Hutchinson v Jauncey (1950) 1 KB 574; Zaimal v Government of Malaysia (1980) AC 734 and Workers Rehabilitation and Compensation Corporation v Quee (23/6/94 unreported, Judgment No 4621), applied.
HRNG ADELAIDE, 6 July 1994 #DATE 28:7:1994
Counsel for appellant: Mr D Wilson
Solicitors for appellant: Lee and Partners
Counsel for respondent: Mr A Martin
Solicitors for respondent: Thomsons
ORDER
Appeal allowed.
JUDGE1 MOHR J The appellant suffered a work related injury on 14th September 1988. She last worked on 28th September 1988 and has had no paid work since that date. On 15th June 1992 having been on weekly payments of compensation up to that date she applied to the Corporation (WorkCover) for commutation of her entitlement to weekly payments of compensation.
2. Her application read:-
" CLAIM NO: 02378866/01/01
NOTICE (pursuant to Section 42 of the Workers
Rehabilitation and Compensation Act 1986, as amended)
I, GLENDA ROSEMARY HACKETT of 14 Blundell Street,
Morphett Vale in the State of South Australia HEREBY
REQUEST that:
1. An assessment be made pursuant to Section 42 of the
Workers Rehabilitation and Compensation Act 1986, as
amended.
2. The submissions made by my solicitors, Lee and
Partners, (if any), be taken to be those of myself as if
the same were written in my own hand.
3. Moneys paid pursuant to such assessment are to be
directed to my solicitors, Lee and Partners, and made
payable to "Lee and Partners Trust Account"."
3. By letter dated 6th July 1992 WorkCover replied in the following terms:-
6th July 1992
LEE AND PARTNERS
BARRISTERS AND SOLICITORS DX 331
ADELAIDE SA ATTENTION: MR D WILSON
Dear Sir,
Re: WORKER: MRS G HACKETT CLAIM NO. RO2378866/01
YOUR REF: DSW10DS 2 91 2452
We have considered your request, on behalf of your
client, for commutation of weekly payments pursuant to
Section 42 of the Workers Rehabilitation and
Compensation Act, 1986. The Corporation has determined
not to make any payments pursuant to Section 42 at this
time. Pursuant to Section 95 your client has the right
to request a review of this decision, Information
regarding the Review and Appeals process is enclosed.
Should you have any queries regarding this matter please
contact the writer on 238 5736.
Yours faithfully
LIZ BAWDEN Case Manager LONG TERM CLAIMS"
4. The appellant appealed for a review of the decision to refuse commutation on 22nd July 1992 in the following terms:-
" APPLICATION FOR REVIEW
Claim No. 02378866/01
Workers Rehabilitation and Compensation Act, 1986
Application for Review
I, GLENDA ROSEMARY HACKETT (Full Name)
of 14 Blundell Street, Morphett Vale 5162 (Address)
Enrolled Nurse (Occupation)
being a person who is dissatisfied by the following
decision made on the 6th day of July 1992 but not
received until the 8th July 1992. (Specify in detail
the decision that you wish to have reviewed)
1. Not to make any payments pursuant to Section 42 of
the Workers Rehabilitation and Compensation Act 1986, as
amended.
APPLY to the Corporation for a review of the decision.
The reasons for my application are as follows:
1. I am entitled to an assessment pursuant to Section
42 of the Workers Rehabilitation and Compensation Act
1986, as amended.
DATED this 22nd day of July 1992.
LEE and PARTNERS
Signed Per: Solicitors for the Worker
The following details will assist in the speedy
processing of this review application.
Employer: Southern Cross Worker: "As above"
Homes Inc Address: 336-342 Marion Road Address: "As
above"
PLYMPTOM NORTH 5037
Telephone:(08) 297 6833 Telephone:(08) 382 8956
The decision which this application seeks to review was
made by: WorkCover My address for service of any
relevant notices or documents is:
Lee and Partners, 154 Gouger Street, Adelaide 5000
NOTE: This application for review may be delivered or
posted to: WorkCover Henry Waymouth Centre 100 Waymouth
Street ADELAIDE SA 5000 DX 660 FAX: (08) 233 2466"
5. The appeal came before a Review Officer on 18th September 1992; 30th October 1992; 10th December 1992 and 19th February 1993. the Review Officer handed down his decision on 5th April 1993 and after giving his reasons made the following determination:-
"Pursuant to s.96(2) of the Act I set aside the decision
of the Corporation made on 6th July, 1992 and substitute
a decision to commute the worker's entitlement to income
maintenance payments for a period of 5.83 years using a
discount rate of 5% as per the actuarial certificate of
Patrick Whelan, Actuary, dated 12th February 1993.
Thereafter the worker's entitlement to weekly payments
of income maintenance is capable of being revived by the
worker."
6. WorkCover appealed to the Workers Compensation Appeal Tribunal on 6th May 1993. The Tribunal published its decision on 21st January 1994 reversing the decision of the Review Officer and reinstating the refusal of WorkCover.
7. At the time all these proceedings were underway s.42 of the Act read:-
"42. (1) Subject to subsection (2), a liability to make
weekly payments under this Division may, on the
application of the worker, be commuted, in whole or in
part, to a liability to pay a lump sum representing the
capitalized value of those payments.
(2) Subsection (1) is subject to the following
qualifications:
(a) the commutation may only apply in relation to a
liability to make weekly payments in respect of a
permanent incapacity;
(b) a liability may only be commuted after the worker
has received compensation for non-economic loss; and
(c) subject to subsection (3), the aggregate of the
amount realized by the commutation and the amount of
compensation for non-economic loss must not exceed the
prescribed sum and if commutation of the total liability
to make weekly payments would result in an aggregate of
those amounts in excess of the prescribed sum, the
extent of the commutation must be reduced accordingly.
(3) The Corporation has a discretion to allow a
commutation notwithstanding that the limit prescribed by
subsection (2)(c) is exceeded if, in the opinion of the
Corporation, the commutation is desirable in order to
avoid a residual liability to make weekly payments of a
trivial amount.
(4) In this section - 'compensation for non-economic
loss' means compensation under Division V: 'the
prescribed sum' means the amount that, at the time of
the occurrence of the disability that gave rise to the
liability to make weekly payments, was the prescribed
sum for the purposes of Division V."
8. There have been since the enactment of Section 42 in that form a series of judgments of this court to the effect that the exercise of the WorkCover's discretion to refuse commutation was reviewable. However, by the time the appeal came on for hearing the amending Act had come into force.
9. Section 42 in its original form was repealed by Section 9 of the amending Act and re-enacted to read:-
"Substitution of s.42 9.
Section 42 of the principal Act is repealed and the
following section is substituted: Commutation of
liability to make weekly payments 42.
(1) A liability to make weekly payments under this
Division may, on application by the worker, be commuted
to a liability to make a capital payment that is
actuarially equivalent to the weekly payments.
(2) However, the liability may only by commuted if-
(a) the incapacity is permanent; and
(b) the actuarial equivalent of the weekly payments does
not exceed the prescribed sum.
(3) The Corporation has (subject to this section) an
absolute discretion to commute or not to commute a
liability under this section, and the Corporation's
decision to make or not to make the commutation is not
reviewable (but a decision on the amount of a
commutation is reviewable).
(4) If the Corporation decides to make a commutation and
makes an offer to the worker, the Corporation cannot,
without the agreement of the worker, subsequently revoke
its decision to make the commutation.
(5) In calculating the actuarial equivalent of weekly
payments, the principles (and any discount, decrement or
inflation rate) prescribed by regulation must be
applied.
(6) A commutation discharges the Corporation's liability
to make weekly payments to which the commutation
relates. (The reference to the prescribed sum is a
reference to the prescribed sum for the purposes of
Division 5 - See s.43(11).)"
10. It is Section 42(3) in the amending Act which is relevant to this matter. It provides quite clearly that the discretion is absolute and not reviewable. The amending Act goes on in Section 20 to provide for the "application of amendments in these terms:-
"Application of amendments 20.
(1) The amendments made by this Act to the principal
Act apply in relation to disabilities occurring on or
after the commencement of this Act.
(2) However-
(a) the amendments made by sections 8, 9 and 10 of this
Act apply both prospectively and retrospectively; and
(b) the amendments made by section 18 apply to any claim
for compensation for hearing loss made on or after 23
March 1994; and
(c) the amendment made by section 11 applies as from 24
February 1994."
11. It is the effect of Section 20(2)(3) (above) which has relevance to this appeal.
12. The so called "literal rule" to be applied to the interpreting of a statute was clearly stated by Higgins J in Amalgamated Society of Engineers v Adelaide Steamship Co. Ltd. (1920) 28 CLR 129 at 161 thus:-
"The fundamental rule of interpretation, to which all
others are subordinate, is that a statute is to be
expounded according to the intent of the Parliament that
made it; and that intention has to be found by an
examination of the language used in the statute as a
whole. The question is, what does the language mean;
and when we find what the language means in its ordinary
and natural sense, it is our duty to obey that meaning,
even if we think the result to be inconvenient,
impolitic or improbable."
13. The learned author of Pearce's Statutory Interpretation in Australia at p.15 sets out the essential elements of the rule thus:-
"(1) that it is the intention of the legislature that is
being sought, ie the intention of the 'writer' of the
document
(2) that that intention is to be derived from the words
of the act alone and not from other sources.
(3) that the words used are to be given their 'ordinary
and natural sense" ie the legislature is to be assumed
not to have put a special meaning on the words
(4) that the court is not concerned with the result of
its interpretation: it is not the court's province to
pronounce on the wisdom or otherwise of the act but only
to determine its meaning."
14. The only departure from the "literal rule" which is allowable - the "golden rule" enunciated by Lord Wensleydale in Gray v Pearson (1857) 6 HLC at 106:-
"... the grammatical and ordinary sense of the words is
to be adhered to, unless that would lead to some
absurdity, or some repugnance or inconsistency with the
rest of the instrument, in which case the grammatical
and ordinary sense of the words may be modified, so as
to avoid the absurdity and inconsistency, but no
farther."
15. Applying the "literal rule" to Section 20(2)(a) of the amending Act in my opinion the meaning is clear. What the legislation has done in effect is retrospectively rewritten Section 42 so that in effect the new Section 42 contained in Section 9 of the Amending act must be taken for the purposes to have been in effect from the date of the proclamation of the original Act. In other words the Corporation always had an absolute discretion to refuse or agree to an application for commutation pursuant to Section 42 and the exercise of that discretion is not and has never been reviewable.
16. Taking this view of the effect of the Amending legislation the exercise of its discretion on 6th July 1992 was the exercise of an absolute discretion which was not reviewable. In my opinion this means that the proceedings in this matter after that date are now a nullity and the appeal must be dismissed.
JUDGE2 DEBELLE AND NYLAND JJ The relevant statutory provisions are set out in the reasons of Mohr J.
2. The Act No 49 of 1994 which amended the Workers Rehabilitation and Compensation Act 1986 came into force on 1 July 1994. For convenience, I will call the amending Act, "the 1994 Act", s.42 as it stood prior to the 1994 Act "the old s.42", and s.42 as introduced by the 1994 Act "the new s.42".
3. This appeal had been instituted before the 1994 Act came into operation. It was instituted on 18 February 1994 and on 3 March 1994 Prior J gave leave to appeal to the Full Court. It was listed for hearing in the May sittings of the Full Court but, at the request of the parties, the hearing was adjourned pending the outcome of the appeal to the Full Court in Workers Rehabilitation and Compensation Corporation v Quee (delivered 23 June 1994, unreported, Judgment No S4621). Had the appeal been heard in May, it is likely that the appellant would have had a decision before the 1994 Act came into operation, a decision unaffected by that Act.
4. The first question is whether s.20 of the 1994 Act and, in particular, the provision in s.20(2)(a) that s.9 is to apply retrospectively has the consequence that the issues in this appeal are to be determined by reference to the new s.42 and this appellant is, therefore, effectively precluded from prosecuting her appeal. The question might be more accurately expressed in these terms: has the Parliament, by stating in s.20(2)(a) that s.9 is to operate retrospectively, altered not only the law governing future applications to commute weekly payments in respect of disabilities which occurred before the commencement of the 1994 Act but also the entitlement of those whose applications had been heard and determined before the commencement of the 1994 Act but were subject either to an application for review, an appeal to the Workers Compensation Appeal Tribunal, or an appeal to this Court to have the appeal determined under the old s.42?
5. The resolution of that question is assisted by examining what the position would have been had s.20 not been enacted. Workers who were receiving weekly payments for a disability suffered before the commencement of the 1994 Act had no accrued right to apply to commute weekly payments. The mere right (assuming it to be properly so called) existing in members of the community or any class of them to take advantage of an enactment, without any act done by an individual towards availing himself of that right, cannot be deemed to be an accrued right: Abbott v Minister for Lands (1895) AC 425 at 431; Continental Liquors Pty Ltd v G.F. Heublein and Bro. Inc (1960) 103 CLR 422 at 426-427; Robertson v Shire of Nunawading (1973) VLR 819. Thus, if s.20 and in particular s.20(1) had not been enacted, the new s.42 would have operated in respect of all applications to commute weekly payments made after the commencement of the Act in respect of disabilities which occurred either before or after the commencement of the amending Act.
6. However, the position would have been different for those workers who had made an application to commute but whose application was either pending or had been determined and was subject to review or appeal. They would have been entitled to have had the application, the review, or the appeal determined under the old s.42. The general rule of the common law which the ActsInterpretation Act reinforces is that, when the law is altered during the pendency of an action, the rights of the parties are decided according to the law as it existed when the action was begun, unless the statute shows a clear intention to vary such rights: Hutchinson v Jauncey (1950) 1 KB 574, 579; Zaimal v Government of Malaysia (1980) AC 734; Continental Liqueurs Pty Ltd v G.F. Heublein and Bro Inc (1960) 103 CLR 422, 426. By instituting this appeal, the appellant acquired the right to have this Court decide whether it should interfere with the determination of the Tribunal and that right is within the protection of s.16(1)(e) of the Acts Interpretation Act; see also Colonial Sugar Refining Co Limited v Irving (1905) AC 369 and Continental Liqueurs Pty Ltd v G.F. Heublein and Bro. Inc (supra) at 426. The question then is whether the terms of s.20(2) by express words or necessary intendment require that an appeal in relation to an application determined under the old s.42 should be governed by the new s.42. We do not think they do. Having enacted s.20(1) which limited the operation of the 1994 Act to disabilities occurring after the Act commenced operation, it was necessary to make special provision to ensure that the new s.42 operated in respect of all applications to commute irrespective of the time when the disability arose. It was necessary to give the new s.42 a retrospective operation in order to achieve that end. Absent a provision such as s.20(2), applications to commute weekly payments in respect of disabilities occurring before the 1994 Act commenced operation would have been determined under the old s.42. Sub-section (2) was, therefore, enacted to qualify the operation of sub-section (1). The interdependence of sub-sections (1) and (2) of s.20 is indicated by the use of the word "however" at the beginning of sub-section (2), thus emphasising that sub-section (2) has been enacted to qualify sub-section (1). In other words, sub-section (2) would have been quite otiose but for the enactment of sub-section (1).
7. Had Parliament intended that all pending applications be subject to the new s.42 and that reviews or appeals in respect of applications already decided should be subject to the new provisions it could have easily said so, for example, by a transitional provision or by other express provision. Had Parliament enacted s.20(2)(a) as a provision standing independently of the other provisions in s.20, it would have had its own operation separate and apart from those other provisions and thus would have indicated an intention to vary the rights of those who had applications for commutation pending or the subject of appeal. It is not the necessary intendment of s.20(2)(a) that it should apply to pending applications and pending reviews and appeals. In the absence of an express enactment, there is an air of unreality if this appeal were to be decided by reference to a new provision which states that the decision appealed from is immune from appeal.
8. This is an unusual case in that it requires the Court to determine whether the Parliament intended by providing that the new s.42 had a retrospective operation that it should apply not only to future applications to commute weekly payments but also to applications already made but awaiting determination when the 1994 Act came into force and reviews or appeals pending at that date in relation to applications already determined. Generally speaking, when a provision is given a retrospective operation, it applies not only to future applications but also to applications awaiting determination and appeals pending from any determination. That is because the intention of the Parliament is clearly ascertainable. But in the instant case, the relationship between subsections (1) and (2), if not the dependence of subsection (2) upon subsection (1), clouds the Parliamentary intention. It is because Parliament has not clearly indicated its intention to alter the rights of parties pending appeal either by express words or necessary intendment that it is not possible to be satisfied that s.20(2) intends that the new s.42 should apply to appeals which are pending as well as to fresh applications to commute. For the above reasons, the terms in which Parliament has expressed s.20 have the consequence that the retrospective operation of the new s.42 does not apply to appeals from determinations made in respect of applications to commute which had been determined before 1 July 1994 when the 1994 Act came into operation. This appeal is, therefore, to be determined under the old s.42 and the decision of the Tribunal may be reviewed by this Court.
9. The argument presented before the review officer was that the appellant's condition was permanent and that she had no reasonable prospect of obtaining work during the remainder of her working life. The prescribed sum in 1988 was $70,100. As the appellant had received compensation for non-economic loss in the sum of $29,792.50, commutation was available in the sum of $40,307.50 or $42,607.50, depending on the proper interpretation of the Act. Having regard to the only actuarial certificate tendered at the hearing, it was submitted that only $56.20 or $59.60 of her weekly payment of $152.90 should be commuted. In the alternative, it was argued that, even if her situation over the remainder of her working life could not be predicted with a reasonable degree of confidence, it certainly could be over the next 5.83 years or 6.221 years. In those circumstances, it was submitted, she should be entitled to commute the whole of her weekly payments for such of those periods as would absorb the balance of the prescribed sum, whatever that might be, but thereafter weekly payments should resume.
10. The review officer found that the appellant had a significant lower back injury which prevented her from ever returning to employment either as an enrolled nurse or in any other employment which required heavy lifting and repeated bending. He also found the appellant had no opportunity for employment in the current economic climate and, quite possibly, even in more buoyant economic times. He concluded that the appellant was in the category of an "odd lot" whose disability incapacitated her for all but the narrowest range of employment. He was satisfied that she would continue to be in that position for the next 5.83 years at least.
11. The review officer then determined the discount rate and held that the appellant's weekly income maintenance payment of $152.90 should be commuted for a period of 5.83 years to a lump sum at the applicable rate. He said that this lump sum equated to the difference between her payment under s.43 and the maximum sum applicable for 1988. He said that for this period of 5.83 years, the appellant would be unable to receive income maintenance payments but thereafter he was satisfied, "having regard to the legislation that income maintenance payments at the appropriate rate are capable of being revived by the worker and paid in accordance with the Act".
12. At the hearing before the Tribunal, counsel agreed by reference to the decision of the Full Court in WorkCover Corporation v Hojski (1993) 170 LSJS
129, which considered the applicability of the Workers Rehabilitation and Compensation (Miscellaneous) Amendment Act 1992 to disabilities and entitlements arising before the commencement of the amending Act, that the balance of the prescribed sum was in fact the higher figure of $42,607.50 and not the figure of $40,307.50 relied on by the review officer. Thus the appellant's revised position was that she should either be able to commute the weekly payment of $59.60 over the remainder of her working life or the whole of her notional weekly earnings of $152.90 over the period of 6.221 years with the resumption of that payment at the end of the period.
13. The Tribunal held that it was open to the review officer to conclude that the worker was incapacitated for all but the narrowest range of work for the ensuing 5.83 years at least and that her prospects of employment and her ability to earn wages by working in that period were negligible. However, the Tribunal held that a proper construction of s.42 did not allow for the course adopted by the review officer. The Tribunal said in its reasons for decision:
"However as I see the position what is being commuted is
a liability to make weekly payments under Division IV of
the Act - Compensation By Way of Income Maintenance.
Pursuant to section 35 (contained in Division IV) a
worker is entitled to weekly payments where an
incapacitating compensable disability has been suffered.
Once commenced those weekly payments are to continue to
be made to the worker unless ended or reduced in
accordance with the provisions of the Act. It seems to
me that the effect of the Review Officer's determination
in this case is not to commute the Corporation's
liability or obligation to make weekly payments to the
worker under the Act (in the sense of ending or reducing
them) but rather amounts to a suspension of that
liability or obligation for the time specified in the
determination in consideration of a lump sum payment.
Thus in my respectful view the course adopted by the
Review Officer was not open to him."
14. The Tribunal's decision was made before this Court held in Workers Rehabilitation and Compensation Corporation v Quee (supra) that it was possible to commute part of the liability for weekly payments provided that the commutation of all future liability did not yield an aggregate figure in excess of the prescribed sum. If it did, commutation must be of the liability over a lesser period. The Tribunal, therefore, erred in finding that commutation was not available for a specified period. On the hearing of this appeal, Mr Martin who appeared for the respondent, acknowledged that the decision in Quee's Case justified the review officer's approach, although the review officer had used the incorrect sum.
15. Mr Martin argued, however, that there was good reason not to commute because the liability for weekly payments would revive at the end of the six year period. He argued that commutation of payments for a period of six years lessened the possibility of rehabilitation which to some extent was contrary to the policy of the Act. This is, however, an appeal on a question of law and it is not appropriate for this court to consider these issues at this stage. The decision of the review officer to commute for a specified period was correct. Further, the Tribunal has also found as a matter of fact that the appellant was permanently unfit for work.
16. For these reasons we would allow the appeal, set aside the order of the Tribunal and in its place order that the appellant's entitlement to receive weekly payments of income maintenance for a period of 6.221 years be commuted by a lump sum payment of $42,607.50.
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