H B Crofton (Decd) by His Trst's Nuttal & Nash v WorkCover Corpn of SA No. Scciv-99-1148

H B CROFTON (DECEASED) BY HIS TRUSTEES
NUTTAL AND NASH v
WORKCOVER CORPORATION OF SOUTH AUSTRALIA
[2002] SASC 64
FULL COURT: Prior, Nyland and Gray JJ

PRIOR J: Section 43 of the Workers Rehabilitation and Compensation Act 1986 entitles a worker to compensation for non-economic loss by way of a lump sum.
Section 43(8) says that no payment is to be made under the section:-
“.... unless the worker is living at the expiration of 28 days from the date of the occurrence of the disability and payment shall not be made under this section after the death of the worker.”
The executors and beneficiaries of the estate of Harmon Briscoe Crofton claim that WorkCover Corporation of South Australia (“WorkCover”) is liable to pay the deceased’s estate a sum of $164317.50. On 23 April 1996, that sum was determined to be Mr Crofton’s entitlement to compensation pursuant to s 43. On 13 October 1995, Mr Crofton, then 81 years of age, sustained multiple injuries in a motor vehicle accident arising out of his employment. He underwent surgery that day and again a week later.
On 19 December 1995, the claims agent of WorkCover determined that Mr Crofton had suffered compensable disabilities within the meaning of the Workers Rehabilitation and Compensation Act. Further surgery occurred in February and March 1996. An artery bypass on the left leg failed. That leg then had to be amputated below the knee. In March the right leg was amputated above the knee.
On 15 April 1996, Mr Crofton’s solicitors requested the respondent’s claim agent to determine Mr Crofton’s entitlement in relation to disability of both his legs, pursuant to s 43. A determination was made on 23 April. It was accepted soon after by Mr Crofton’s solicitors. The letter, advising Mr Crofton’s solicitors that he was entitled to the lump sum payment, stated that if no review of the decision were lodged, a cheque for the total amount would be sent in six weeks time. Mr Crofton died on 6 May 1996. The entitlement had not been paid. It has not been paid since.
WorkCover claims that the payment is precluded by s 43(8). In these proceedings, the parties ask whether the applicants, as executors and beneficiaries of Mr Crofton’s estate,
“are deprived by s 43(8) .... of their entitlement to enforce, by civil action, payment by (WorkCover) of the amount determined ... on 23 April 1996 to be Mr Crofton’s entitlement pursuant to s 43 of the Act”.
The applicants submit that whilst, ordinarily, words are assumed to be used consistently in the same statutory provision, given that the Workers Rehabilitation and Compensation Act is beneficial legislation and an interpretation favouring the worker is to be preferred, a different construction of “payment” is required for each of the situations identified in s 43(8).
With respect to payment being dependent upon the worker living at the expiration of 28 days from the date of the occurrence of the permanent disability compensable under the Act, “payment” refers to the act of tendering money. However, in the other reference to “payment”, “payment” has to be understood as meaning that no liability to make a payment of lump sum compensation can arise after the death of the worker. On that construction it was submitted that the applicants were entitled to recover.
It was submitted that unless different meanings were given to the word “payment” within the subsection, the first part of the section would be rendered otiose. There would be no need to prohibit the tendering of payment unless the worker was living at the expiration of 28 days from the date of the occurrence of the disability where payment is not to be tendered after the death of the worker. Equally, it was submitted that to construe the word “payment” as meaning liability to make payment would likewise render the first limb of the subsection mere surplusage.
The applicant submitted that the Act establishes a distinction between the entitlement to a lump sum for permanent disability and the liability to pay that lump sum. The entitlement arises once a worker has suffered a compensable disability that is permanent. That is clear from the language of s 43(1)[1]. The liability to pay occurs either when the time period within which a determination can be disputed has expired or, where a determination has been disputed, that dispute has been conclusively decided in accordance with Part 6A of the Act, or where a determination has been accepted by the worker.
[1] See Cristea v Workers Rehabilitation and Compensation Corporation (1993) 61 SASR 487 at 489
The applicants say that the construction advanced was to be preferred to the interpretation relied upon by WorkCover because that construction would create an anomalous position of a liability to pay existing alongside a prohibition on making the payment. That construction would also result in the abrogation of an enforceable right at common law to the payment.
In Christeav Workers Rehabilitation and Compensation Corporation[2], King CJ emphasised that claims for compensation are made, giving rise to one or more of the entitlements to compensation conferred by the Act. King CJ’s assertion, in that case, that the determination by the Corporation to accept or reject a claim is central to a worker’s entitlement to compensation was cited with approval by Doyle CJ in Della Flora v Workers Rehabilitation and Compensation Corporation of South Australia[3].
[2] (1993) 61 SASR 487 at 489
[3] [Full Court, 20 May 1998, Jdgmt No S6691, unreported]
In Della Flora, Doyle CJ observed that the Act is silent, unless some implication is to be drawn, about whether and how a determination can be enforced by a worker in whose favour the determination is made. His Honour also said that the Act was equally silent about when such a determination became enforceable. The Chief Justice referred to the well-known presumption to the effect that when a statute creates an obligation or liability to pay money to a particular person, an action will lie for the recovery of that money unless the statute contains a provision to the contrary. The Chief Justice concluded that, in that case, where a notice of dispute had been lodged, the time at which payment under the determination could be enforced by action was deferred so that the summons issued in that case was issued before the worker had a cause of action against the Corporation.
The Chief Justice acknowledged that it was not necessary to decide, in that case, whether the Corporation was obliged to make payment once the period had passed within which a determination may be the subject of a notice of dispute. However, His Honour did say that he could think of no reason why the presumption in favour of enforceability should not operate in relation to a payment due under a determination that is, prima facie, not disputed.
WorkCover emphasised that s 43 authorised payment for an injury and, in effect, the non-economic loss occasioned by injury or disability. This entitlement was quite separate from any payment for economic loss. Section 44 contains provisions for compensation payable on death, conferring an entitlement to a lump sum for a spouse and dependent children. WorkCover submitted that s 43 and s 44 introduced a new concept into workers compensation legislation in this State, with amounts being paid for non-economic loss not related to economic loss in any way. It was emphasised that within s 44, Parliament had provided that the sum to which a spouse or dependent child was entitled was a lump sum less “any amount that the worker received as compensation for non-economic loss under Division 5”[4]. Section 43 is the only provision within Division 5.
[4] s 44(1)(b)(i) and s 44(1)(c)(i)(A)
When s 43 and s 44 were considered together, benefits were payable under s 44 where a compensable disability was fatal but under s 43 when it was not. Particular provisions in s 44 dealt with a situation where a worker survived for a while but then died, either due to the compensable disability or otherwise. Against that, the purpose of the first part of s 43(8) was clear. No payment was to be made unless the worker was living. Thus the first part of s 43(8) was intended to ensure that, as far as possible, if a worker died as a result of the compensable disability the lump sum benefits went to those needing them, the spouse or dependents.
As for the second part of s 43(8), WorkCover submitted that the further restraint on payment not being made after the death of the worker was to be compared with a situation at common law. Damages for non-economic loss are not recoverable after the death of the plaintiff unless judgment has been entered with an assessment of non-economic loss merging into the judgment sum. It was submitted there was nothing unusual about the particular provision within s 43(8), especially when one had regard to the purpose for which s 43 was introduced into the Act, to replace a claim for common law damages.
WorkCover said there was no justification for giving “payment” any meaning other than its usual meaning in both parts of s 43(8). A proper construction of s 43(8) was to identify that entitlement was dependent upon the clear language in s 43(8). Whilst the provision in s 43(1) speaks of an entitlement to compensation, it is silent as to who pays it. That must be by reference to the Corporation in s 46. WorkCover submitted that the applicant was not able to maintain that the deceased had a vested right when his solicitor accepted the determination of the Corporation’s claims agent. The worker was not the only person entitled to dispute a determination. The employer could[5]. The fact that it might be unlikely that any notice of dispute would be lodged does not mean that the deceased’s rights were vested upon his acceptance of the admitted entitlement. At the time of Mr Crofton’s death there was no liability to pay.
[5] s 90(3)(b)
I think WorkCover is correct in the submission that there is no immediate right to payment of the amount determined to be payable under s 43 following the determination by a compensating authority of the amount of the worker’s entitlement under that section. Della Flora itself is authority for that proposition. Equally, I think WorkCover is correct in maintaining that payment should not be construed in the way maintained by the applicants. Such a construction would have been more appropriate and obvious if s 43(8) resorted to relating liability to entitlement rather than payment. The Workers Rehabilitation and Compensation Act establishes a code with benefits different from those arising under the common law. I think it is plain that Parliament intended that benefits available under s 43 were for the benefit of the worker alone and not for his estate. Non‑economic loss is peculiar and personal to the worker. It is not to be paid after the death of the worker.
There remains the alternative argument advanced by the applicants. They sought to invoke equitable principles to maintain that, notwithstanding the specific statutory provision, the Corporation should be compelled to pay the sum determined to be the worker’s entitlement given that the Corporation was informed that the determination had been accepted. The argument was that the right then crystallised. Urgent payment was sought for obvious reasons given the poor state of Mr Crofton’s health. The Corporation said it would investigate what it could do about effecting payment as soon as possible. Mr Crofton’s death occurred some 12 days after this. The failure to pay the sum determined before Mr Crofton’s death was said to be unconscionable. The Corporation should not profit from its failure to make the payment before Mr Crofton’s death. Reliance was placed upon the proposition that a party having a legal right is not permitted to exercise it in such a way that the exercise amounts to unconscionable conduct[6]. The Corporation’s conduct in failing to pay is said to be conduct which is unconscionable.
[6] Legione v Hateley (1983) 152 CLR 406 at 444
The applicants submitted that the Corporation was liable to pay the amount determined on 23 April 1996 consistent with the principles affirmed by the High Court in The Commonwealth v Verwayen[7]. I do not accept that the equitable principles discussed in the cases cited have application here. The Corporation cannot be found to have acted unconscionably. It has simply complied with the law. I reject the submission that it is unconscionable for the Corporation to have delayed in the making of the payment before Mr Crofton died. He died within a fortnight of the acceptance of the determination. A corporation cannot be guilty of unconscionable conduct if it seeks to do nothing more than comply with the law. I do not think that it is enough to say that, by accepting a liability, it is estopped from denying that liability by a subsequent event.
[7] (1990) 170 CLR 394
The restraint on payment is a statutory obligation of an unconditional character. The admission of an estoppel against the Corporation would nullify the statutory provision[8]. The Corporation is required to obey the imperative provisions in s 43(8)[9].
[8] Maritime Electric Co Ltd v General Dairies [1937] AC 610 at 620
[9] Chamberlain v Deputy Commissioner of Taxation (1988) 164 CLR 502
I would therefore answer the case stated thus:-
“Payment of any entitlement to a lump sum for non-economic loss is dependent upon the worker being alive when payment is made. Payment cannot occur within 28 days of the occurrence of the permanent disability compensable under the Act nor after the death of the worker. The executors and beneficiaries of the deceased cannot enforce the worker’s entitlement. Payment of that entitlement can only occur during the lifetime of the worker.”
NYLAND J: I agree with the answer to the case stated as set out by Prior J for the reasons he has expressed.
GRAY J: I agree with the orders proposed by Prior J for the reasons he has prepared.

[2002] SASC 64

16 April 2002