Hamilton v Mulgrave Central Mill Co Ltd
[2000] QSC 130
•8/05/2000
IN THE SUPREME COURT
OF QUEENSLAND
CAIRNS No.122 of 1999
Before the Hon. Justice Jones
[Hamilton -v- Mulgrave Central Mill Co. Ltd] [2000] QSC 130
BETWEEN: GRAHAM JOHN HAMILTON
Plaintiff
AND: THE MULGRAVE CENTRAL MILL COMPANY LIMITED
Defendant
JONES J
Judgment delivered 8th day of May, 2000
The preliminary questions are determined by declaring-
That the plaintiff had at the date of the issue of the writ in this action received a valid offer of lump sum compensation under s.132 of the Workers’ Compensation Act 1990; and
That the plaintiff was therefore entitled to commence proceedings number 122 of 1999 seeking damages at law.
The question of costs is reserved for further argument.
Catchwords: PRACTICE - PRELIMINARY POINTS OF LAW - WORKERS’ COMPENSATION - ENTITLEMENT TO AND LIABILITY FOR COMPENSATION - Plaintiff suffered back injury during course of employment - Received benefits - Whether plaintiff had received offer of lump sum compensation - Whether plaintiff is precluded from seeking common law damages - Interpretation of act - Practical effect - Valid offer received - Proceed with action
Counsel:Mr M Glen for the Plaintiff
Mr RJ Douglas for the Defendant
Solicitors:Gayler Cleland Towne for the Plaintiff
MacDonnells Solicitors for the Defendant
Hearing date: 25th October 1999
IN THE SUPREME COURT
OF QUEENSLAND
CAIRNS Writ No. 122 of 1999
PlaintiffGRAHAM JOHN HAMILTON
Defendant: THE MULGRAVE CENTRAL MILL COMPANY LIMITED
REASONS FOR JUDGMENT
BEFORE THE HONOURABLE JUSTICE JONES
DELIVERED THE 8TH DAY OF MAY, 2000
The plaintiff who was born on 27 November, 1993 sustained a back injury in the course of his employment with the defendant on 14 September, 1996. He applied for, and received, weekly Workers’ Compensation benefits pursuant to the Workers’ Compensation Act 1990 (“the Act”). The Act has since been repealed by the WorkCover Queensland Act 1996 which came into effect on 1 February, 1997. The plaintiff’s rights, however, to maintain the action for damages he commenced on 30 June, 1999 is to be determined by reference to the provisions of the 1990 Act. [1]
[1] See s.551(1) and (2) of the WorkCover Act.
By its defence the defendant asserted that at the time of the commencement of the action the plaintiff had not received a valid offer of lump sum compensation pursuant to s.132 of the Act nor had he received from WorkCover a conditional damages certificate pursuant to s.182D of the Act. The defence was delivered on the eve of the expiration of the limitation period. Consequently if this application fails the plaintiff will face the prospect of not being able to overcome a limitation defence.
For this reason the application is now made to determine as a preliminary point the following questions:-
Whether the plaintiff had as at the date of the issue of the writ in this action, received a valid offer of lump sum compensation; and
Whether the plaintiff is precluded from seeking damages at law in these proceedings.
Background facts
The defendant applied for weekly workers’ compensation benefits from the date of his injury which he initially nominated as being 21 September, 1996. The application form however was amended to show the date of injury as 14 September, 1996. In any event, it seems the plaintiff received weekly payments, presumably having undergone medical examinations and supplied medical certificates.
On 24 July, 1998 the plaintiff signalled his intention to claim damages when his solicitors wrote to WorkCover seeking a s.182D certificate.
On 1 September, 1998 WorkCover responded by giving its assessment of his permanent impairment from injury at a level of 15% and making an offer of compensation at $17,330.00. This assessment and offer was contained in a single document headed Notice of Assessment but with a further part entitled Offer of Lump Sum Compensation. This document was accompanied by a further document entitled Important Information which explained in greater detail the choices to be made by a claimant and the consequences of those choices. But no reference was made in any of these documents to the plaintiff’s request for a s.182D certificate.
The plaintiff after discussions with his legal advisers took no action in respect of the assessment or the offer. Without further contact with WorkCover, he commenced these proceedings as referred to above. He had not by that date received the s.182D certificate which had been requested on 24 July, 1998.
The question then is whether, by his failure to respond to the assessment/offer or to obtain a s.182D certificate he was denied the right to commence proceedings for damages at law.
The statutory provisions
The Act provided for a scheme for the payment of workers’ compensation benefits to an injured worker in two forms – weekly benefits (Part 8 and Part 9 Division 1) and a lump sum benefit for permanent impairment (Part 9 Division 2). Section 132 of the Act sets out the procedure for the offer and payment of lump sum compensation in the following terms:-
“132(1) The board may make an offer of lump sum compensation to or on account of a worker who has suffered an injury prescribed under the table of injuries that has resulted in the worker sustaining a permanent impairment.
An offer may be made only if –
the board and the worker both accept the worker’s degree of permanent impairment is the degree assessed by a registered medical practitioner or under section 95(9); or
a medical assessment tribunal has decided on a reference under Part 10 that the worker has sustained a degree of permanent impairment.
The following information must be stated on the offer –
the degree of the worker’s permanent impairment;
the degree of the worker’s impairment attributable to the injury;
the percentage of statutory maximum compensation the worker is entitled to for the injury;
the amount of lump sum compensation payable under section 130 the worker is entitled to for the injury.
If the worker is entitled to lump sum compensation under section 130 for an injury, other than a certificate injury, the board must –
advise the worker about the choice the worker must make under section 182B; and
give the worker a copy of sections 182A, 182B and 182C.
An offer may be accepted or rejected, or a decision about the offer may be deferred, within 28 days after a written offer is made by the board (the “decision period”).
If, within the decision period, the worker does not advise the board that the offer is accepted or rejected or that the worker wishes to defer the decision, the worker is taken to have deferred the decision.
If the offer is accepted, the board must pay the lump sum compensation entitlement to or on account of the worker.”
The Act also recognises the right of an injured worker to receive damages at law independently of the Act for which the Workers’ Compensation Board will indemnify the employer.
By s.182B, the Act provides that a worker is not entitled to both the lump sum compensation and damages at law. Subsection (2) requires that, in the circumstances prevailing in this case, the worker must choose between “the lump sum offered and seeking damages at law”. Then follows these subsections:-
“(3)The worker must give the board notice of the worker’s choice in the approved form.
If the worker fails to give the board notice of the worker’s choice before the worker seeks damages at law, the worker is taken to have made a choice to reject lump sum compensation for the injury.
...
The worker is taken to seek damages at law for the injury when the worker –
seeks to negotiate a damages settlement with the board; or
starts proceedings at law for damages.”
A worker who chooses to seek damages at law suffers a number of consequences which are set out in s.182C. These do not need to be considered for the purpose of this application.
Where a worker has not received an offer of a lump sum compensation pursuant to s.132 then the worker, in circumstances relevant to this case, may seek damages at law “only if the Board gives a certificate under s.182D”. No such certificate has been issued here so the plaintiff’s right to seek damages depends on the determination whether he has received a lump sum offer pursuant to s.132 and, if so, whether by reason of s.182B(4) he has rejected that offer.
The defendant argues that no lump sum offer was ever made. It seeks to characterise that what appears as an offer in the documents of 1 September, 1988 was “incipient and remained inchoate” and dependent upon the plaintiff’s acceptance of the assessment of impairment. It is argued there was no acceptance of the assessment and therefore no offer by WorkCover.
The defendant further argues there having been no offer, s.182D requires, as a mandatory step, the obtaining of a certificate, conditional or otherwise, from WorkCover before the action commenced.
If indeed s.182D is applicable there is no doubt about the correctness of this last submission in the light of the Court of Appeal decision on the equivalent provisions of the successor enactment (WorkCover Queensland Act 1996) in Bonsor v Melnacis [2]. The court there found that the scheme “effectively abolishes any entitlement on the part of an injured worker to commence proceedings against the employer and that such a right owes it existence only upon compliance with the prescribed steps”. [3]
[2] 2000 QCA 13
[3] See ibid at para 41
But the plaintiff did apply to the board for such a certificate and that request appears to have been ignored.
The plaintiff, for his part, argues that the documents of 1 September, 1998 did convey an offer and that by force of s.132(5) and (6) he is deemed to have deferred that offer. Further, by the plaintiff starting these proceedings he is “taken to seek damages at law” [4] which constitutes a “choice to reject lump sum compensation for the injury” [5]. Therefore the plaintiff argues that no s.182B certificate was required.
[4] see s.182B(6) of the Act
[5] see s.182B(4) of the Act
As I construe the provisions of the Act this act of commencing the proceedings signifies not merely the rejection of a particular offer of a lump sum payment nor indeed of a particular assessment of impairment, but rather a rejection of any entitlement under Part 9 Division 2 of the Act.
In Hibberd v South Blackwater Coal Limited [6] Demack J. dealt with the questions that arise here. The only factual difference in the circumstances of that case was that in the appropriate box on the composite assessment/offer document, Mr. Hibberd recorded his election to defer his decision on the offer. In his reasons, Demack J concluded that this election meant that Mr. Hibberd, for the purpose of the offer, accepted the assessment of impairment. In my view that placed Mr. Hibberd in no different position to the plaintiff who, by the force of s.132(6) is, “deemed to have deferred the decision”.
[6] Unreported decision of Demack J – 28 August 1998 – No.47 of 1997
More importantly Demack J commented upon the proper construction of the statutory provisions. He said:-
“A worker to whom lump sum compensation is payable under division of Pt 9 of the Act is not entitled to both lump sum compensation for the injury and damages at law for the injury (s.182B(1)). If the worker fails to give the board notice of the worker’s choice before the worker seeks damages at law, the worker is taken to have made a choice to reject lump sum compensation for the injury (s.182B(4). There is a requirement in s.182B(3) that the worker must give the board notice of the worker’s choice in the approved form. The plain words of s.182B(4) make it clear that the provision in s.182B(3), which appears to be mandatory, does not need to be complied with. The worker may reject the offer by commencing proceedings. [my emphasis]
The argument addressed by WorkCover turns on the words of s.132(2) that an offer of lump sum compensation “may be made only if the board and the worker both accept the worker’s degree of permanent impairment...assessed by a registered medical practitioner”. The argument assumes that there must be some kind of formal acceptance by the worker. The Act does not say that, and the plain effect of s.182B(3) and s.182B(4) which was introduced into the Act in 1995 with the present s.132 shows that, while Parliament expected that the worker should follow an orderly course, it should not be reduced to some mindless ritual.”
I am in respectful agreement with these remarks.
I regard the composite document of 1 September, 1998 as an offer of lump sum compensation as contemplated by the Act. It had the effect of placing the plaintiff in the position of having to choose between two types of entitlement - lump sum compensation or damages at law. The plaintiff’s election was made by his action in commencing these proceedings and the force of s.182B(4).
In Coombs v Queensland Cotton Corporation Ltd [7] Helman J also considered a similar situation but with the difference that Mr. Coombs, having received the composite assessment/offer document, made an election reject the offer, signed the form accordingly but did not return the form to WorkCover before commencing an action to claim damages.
[7] Unreported decision of Helman J – 14 October 1999 – No.5214 of 1999
In Coombs, WorkCover argues that because of the failure to communicate his acceptance of the assessed impairment, no offer of a lump sum compensation had in fact been made and that the action could not be commenced without a s.182D certificate.
Helman J noted:-
“There was nothing in the 1990 Act requiring notification of acceptance of the assessment, nor was there anything in the Notice of Assessment or the Important Information document. Furthermore the reference to the twenty-eight day period on the first page of the Important Information document indicated that the plaintiff had only so long to accept or not to accept the assessment, so failing to respond within twenty-eight days could be taken as acceptance of the assessment.”
His Honour relying on analyses of statutory provisions dealing with times within which a worker’s election had to be made, concluded that the composite document was indeed an offer for the purpose of Pt. 9 of the Act.
Counsel on behalf of the respondent argued before me that His Honour’s analyses were incorrect because there was no time limited on the right to challenge the assessment and the board had no warrant to impose such time limits. Although s.171(1) and (2) provide that the General Manager may refer a claim to a tribunal for assessment of impairment “at any time and from time to time” this does not in any way qualify the board’s right to make an offer on an assessment which it currently holds. Any reassessment might simply provide the basis for another offer. There is no reason why the board could not stipulate for the purpose of a particular offer period within which there should be an acceptance of the assessment upon which the offer is based. I would agree with the basis of Mr. Justice Helman’s decision.
The outcome, in my view, does not only depend on a particular analysis of the processes prescribed by the Act but rather on the characterisation of the effect of the various provisions.
Sections 130 and 130A deal with the assessment of impairment.
s.130(1) Provides the entitlement to lump sum compensation.
(1), (2) and (3) Prescribes how the entitlement is calculated.s.130A(1)Provides (relevantly) that the degree of impairment must be assessed by a registered medical practitioner.
(4)If disagreement between board and worker, the assessment is to be determined by a tribunal.
This simply ensures that the degree of impairment has been professionally assessed.
Section 132 deals with an offer made by the board.
s.132(1) Provides that the board may make an offer.
(2)The offer is to be based on the assessment (agreed or as determined by the tribunal).
(3) Describes the formulation of the terms of the offer.
(4) Prescribes the information to be provided with the offer.
(5) & (6) Provides for acceptance, rejection or deferral of the offer(7) Creates the obligation to pay if the offer is accepted.
The defendant’s argument in this case and in the other reported decisions relies upon s.132(2) as requiring some strict adherence to a sequential, or step by step, approach. But there is no practical reason for this. Nor is there any provision in the Act which requires it, save for a strict interpretation of the words of the subsection: “an offer may be made only if”.
In the scenario envisaged by s.132(2)(b) the amount of the offer is outside the control of the offerer or the offeree. It is arrived at simply by the application of the tribunal’s assessment to the relevant scale. The worker is entitled to this amount as lump sum compensation and to no other amount. If the tribunal assesses a permanent impairment then it would seem that the board really has no option but to make the offer. The words “only if” do not seem to be in any way relevant to that situation.
But there is no reason why an offer of the kind envisaged by s.132(2)(a) could not be made conditional upon the acceptance by the offeree within a nominated time of the assessed degree of impairment. The fact that the offer is so conditioned does not change its character as an offer. If the condition is not accepted by the worker then the offer is clearly rejected. If the offer is accepted then it can only be on the basis of acceptance of the condition the assessed degree of impairment. Regardless of the worker’s response to the offer, the consequence remains the same for the board – the cessation of all other compensation benefits. See s.135.
The strict interpretation contended for on behalf of WorkCover and this case runs counter to the procedure it follows in practice by delivering the composite assessment/offer document. This document contained the information required by s.132(3). It was accompanied by the advice and copies of statutory provisions in compliance with s.132(4). In other words, the document containing the offer and the accompanying material bore all the hallmarks of an offer pursuant to s.132. Nowhere in this body of material is there any suggestion that an acceptance by the worker of the assessment of degree of impairment had to be communicated prior to a consideration of the offer. Such a step is not required by the Act nor indeed is it suggested in the Important Information. Rather this document contains the terms –
“If you agree with the degree of permanent impairment stated in the notice of assessment, please tick the appropriate box on the notice and proceed to the second decision.”
There is no requirement in the Act for the ticking of any box or any other fetter on consideration of the offer of lump sum compensation.
Moreover this strict interpretation is relied upon to inhibit the plaintiff’s right of access to the court. In accordance with the authorities the court should opt for a construction which does not have this effect unless by clear words such a right is taken away.
Having regard to the practical effect of this provision, I have taken the view that on its proper construction s.132(2) means no more than an offer may be made conditioned upon the acceptance by both the board and the worker of the assessed degree of permanent impairment. If the worker goes on to consider the offer then it may be inferred that there is acceptance by both the board and the worker of the degree of impairment which underpins the offer. Once an offer is made in this sense there has been compliance with s.132 and the consequences referred to in ss.135, 182B and 182C of the Act follow.
I would therefore determine the preliminary questions by declaring –
(1)that the plaintiff had at the date of the issue of the writ in this action received a valid offer of lump sum compensation under s.132 of the Workers’ Compensation Act 1990; and
(2)that the plaintiff was therefore entitled to commence proceedings number 122 of 1999 seeking damages at law.
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