Hayes v Secretary (Department of Education)

[2025] NSWPIC 373

CERTIFICATE OF DETERMINATION OF MEMBER 

CITATION:

Hayes v Secretary (Department of Education) & Ors [2025] NSWPIC 373

APPLICANT:

Benjamin Hayes

FIRST RESPONDENT:

Secretary (Department of Education),

SECOND RESPONDENT:

Harrison Benjamin Hayes

THIRD RESPONDENT:

Matilda Louise Hayes

MEMBER:

John Turner

DATE OF DECISION:

4 August 2025

CATCHWORDS:

WORKERS COMPENSATION - Workplace Injury Management and Workers Compensation Act 1998; interest; discretion; section 109; Shanika Cooper v G & W Mudge Concreting Pty Ltd & others, Lavelle v David Paul Browne & others, Kathryn Ann Kratz as executrix of the estate of the late Owen Beddall v Qantas Airways Limited, Hu v Rongfar Property Services Pty Ltd & others, Youseph v Homebush Unit Trust t/as Primo Smallgoods & others, Haidary v Wandella Pet Foods Pty Ltd, and Batchelor v Burke considered; Held – pursuant to section 109 the first respondent is to pay the applicant interest.

DETERMINATIONS MADE:

The Commission determines:

1. The first respondent is to pay to the applicant, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, interest on the sum of $679,440 as follows:

a.    from 7 February 2025 to 18 February 2025 at the rate of 6.35% per annum;

b.    from 19 February 2025 to 20 May 2025 at the rate of 6.10% per annum; and

c.     from 21 May 2025 to 5 June 2025 at the rate of 5.85% per annum.

2. The first respondent is to pay to the second respondent, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, interest on the sum of $84,930 as follows:

a.    from 7 February 2025 to 18 February 2025 at the rate of 6.35% per annum;

b.    from 19 February 2025 to 20 May 2025 at the rate of 6.10% per annum; and

c.     from 21 May 2025 to 5 June 2025 at the rate of 5.85% per annum.

3. The first respondent is to pay to the third respondent, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, interest on the sum of $84,930 as follows:

a.    from 7 February 2025 to 18 February 2025 at the rate of 6.35% per annum;

b.    from 19 February 2025 to 20 May 2025 at the rate of 6.10% per annum; and

c.     from 21 May 2025 to 5 June 2025 at the rate of 5.85% per annum.

A brief statement is attached setting out the Commission’s reasons for the determination.

STATEMENT OF REASONS

BACKGROUND

1. Michelle Hayes (deceased) tragically died on 16 February 2022 having contracted COVID-19 in the course of her employment as a schoolteacher with the Secretary (Department of Education) (first respondent).

2. The only persons making a claim for dependency and compensation are Benjamin Hayes (applicant), the deceased’s husband, Harrison Benjamin Hayes (second respondent), their son, and Matilda Louise Hayes (third respondent), their daughter.

3. This matter was the subject of a previous determination of the Personal Injury Commission (Commission) in regard to liability in respect to which a Certificate of Determination with a Statement of Reasons was issued dated 8 April 2025.

4. A further preliminary conference was held on 5 June 2025 at which time the parties were able to come to an agreement subject to the approval of the Commission in respect to the payment of compensation save for the interest to be paid on the lump sum compensation payable under s 25(1)(a) of the Workers Compensation Act 1987 (1987 Act).

5. The parties proposed that the lump sum payable under s 25(1)(a) of the 1987 Act be apportioned 80% to the husband of the deceased, Benjamin, and 10% each to Harrison and Matilda. The apportionment was approved and Certificate of Determination with a Statement of Reasons was issued dated 6 June 2025.

6. One issue remains in dispute which is the compensation payable on the lump sum benefits awarded pursuant to s 25(1)(a) 1987 Act. The Certificate of Determination dated 6 June 2025 award the following compensation pursuant to s 25(1)(a):

(a)Benjamin Hayes $679,440;

(b)Harrison Benjamin Hayes $84,930, and

(c)Matilda Louise Hayes $84,930.

ISSUES FOR DETERMINATION

1. The parties agree that the following issues remain in dispute:

   (a) Interest payable on the lump sum compensation payable pursuant to s 25(1)(a) of the 1987 Act.

PROCEDURE BEFORE THE PERSONAL INJURY COMMISSION

1. I am satisfied that the parties to the dispute understand the nature of the application and the legal implications of any assertion made in the information supplied.  I have used my best endeavours in attempting to bring the parties to the dispute to a settlement acceptable to all of them.  I am satisfied that the parties have had sufficient opportunity to explore settlement and that they have been unable to reach an agreed resolution of the dispute. 

2. The parties have agreed to the determination of the matter without a conference or formal hearing. The parties have provided written submissions.

EVIDENCE

Documentary evidence

1. The following documents were in evidence before the Commission and considered in making this determination:

   (a)    Application to Resolve a Dispute and attached documents;

   (b)    Replies filed on behalf of each respondent and attached documents;

   (c)    documents attached to Application to Lodge Additional Documents lodged on behalf of the applicant dated 3 December 2024, 27 November 2024, 5 November 2024 and 13 March 2025; and

   (d)    documents attached to Application to Lodge Additional Documents lodged on behalf of the first respondent dated 6 March 2025.

FINDINGS AND REASONS

Interest period

1. The applicant claims interest from 1 July 2022 to 5 June 2025.

2. In the submission of the (first respondent) the claim was not “duly made” until 7 February 2025, being the date that all relevant liability and dependency evidence relied upon was served by the applicant, second and third respondents. In the first respondent’s submission the earliest that interest should be award from is from 7 February 2025.

3. Section 109 of the Workplace Injury Management and Workers Compensation Act 1998 (1998 Act) provides for the payment of interest and states:

   “109   Interest before order for payment

   (1)In any proceedings before the Commission, the Commission may order that there is to be included, in any sum to be paid, interest at such rate as the Commission thinks fit on the whole or any part of the sum for the whole or any part of the period before the sum is payable, subject to the limitations imposed by this section.

   (2)Interest cannot be ordered under this section—

   (a)       on any compensation payable under Division 4 of Part 3 of the 1987 Act, or

   (b)on any compensation payable under this Act for any period before a claim for the compensation was duly made, or

   (c)on any compensation payable under this Act for any period during which proceedings before the Commission were adjourned on the application of the claimant for the compensation or pursuant to section 102.

   (3)  This section does not—

   (a)       authorise the giving of interest upon interest, or

   (b)apply in relation to any debt upon which interest is payable as of right whether by virtue of any agreement or otherwise.”

4. The Personal Injury Commissions (Commission) jurisdiction to award interest pursuant to s 109 is discretionary[1] subject only to the limitations set out in subs (2) and (3). Whilst the discretion is wide it must be exercised having regard to all the facts of the particular case and in the context of and by reference to the legislation by which it is conferred and the relevant authorities. The purpose of ordering interest is not penalise the employer.[2]

   [1] Haidary v Wandella Pet Foods Pty Ltd [2005] NSWWCCPD 9 at [10] (Haidary).

   [2] Haidary at [10].

5. Pursuant to s 109(2)(b) interest cannot be ordered for any period prior to the claim for compensation being duly made.

6. In Shanika Cooper v G & W Mudge Concreting Pty Ltd & others (WCC6411/18) (Cooper) Arbitrator Wynyard (as he then was) formed the view that the phrase “duly made” refers to the date when the applicant’s claim is fully particularised. This approach was adopted by Arbitrator Isaksen (as he then was) in Lavelle v David Paul Browne & others (WCC533/19) (Lavelle) and in Kathryn Ann Kratz as executrix of the estate of the late Owen Beddall v Qantas Airways Limited [2020] NSWWCC 36 (Kratz) as well Member Haddock in Hu v Rongfar Property Services Pty Ltd & others [2021] NSWPIC 95 (Hu) and Senior Member Capel in Youseph v Homebush Unit Trust t/as Primo Smallgoods & others [2021] NSWPIC 299 (Youseph).

7. On 1 July 2022 the solicitors for the first respondent wrote to the applicant’s solicitors seeking further and better particulars in respect to the claim.[3] On 7 July 2022 the applicant’s solicitors responded to the correspondence of 1 July 2022.[4] The correspondence from the applicant’s solicitors relevantly noted that a Death Certificate was not yet available setting out the cause of death and advised that instructions were being sought in relation to particulars 6 to 9. Particular 9 requested particulars of all those known to be dependent upon the deceased at the time of her death, and who may have a claim for a portion of the s 25(1)(a) lump sum compensation.

   [3] ARD   pp. 13-14.

   [4] ARD   pp. 15-16.

8. The first respondent appears to have again emailed its correspondence of 1 July 2022 to the applicant’s solicitors on 20 July 2022. On 1 August 2022 the applicant’s solicitors wrote to the first respondent relevantly advising that a complete Death Certificate was still not available and providing a response to particular 9 identifying the applicant and the first and second respondents as dependant.[5]

   [5] ARD   pp. 17-19.

9. On 15 May 2023 the applicant’s solicitors wrote to the respondent advising that the cause of death had been found to be COVID-19 lower respiratory infection and enclosing a copy of the Death Certificate.[6]

   [6] ARD   p. 20.

10. On 15 September 2023 and 25 September 2023 notices pursuant to s 78 of the Workplace Injury Management and Workers Compensation Act 1998 (1998 Act) were issued to the applicant disputing the compensation claim for death benefits.[7]

    [7] ARD   pp. 22-26, 28-32.

11. On 8 October 2024 the applicant filed these proceedings with the Commission. The proceedings were initially commenced against a single respondent being the first respondent. The Application in Respect of Death of Worker (Application) identified only the applicant as a dependant of the deceased whilst the second and third respondents were identified as may have been dependant or may be claiming to be dependant.

12. The applicant submits that a compelling factor that is relevant to the exercise of the discretion in this matter, and which outweighs other considerations, is that the insurer has had the use of the lump sum in circumstances where it has never disputed the dependency of the applicant and has elected to dispute the claim from a very early stage on the basis of an opinion from Professor Wakefield.

1. In the applicant’s submission it was “inevitable” on the basis of the high standard of the presumption in s 19 B of the 1987 Act and the evidence in the dispute that the respondent would not be able to rebut the presumption in s 19B.

2. I do not accept the applicant’s submission. Whilst I accept that it is notoriously difficult to rebut a presumption the factual circumstances in this matter added a significant degree of complexity to the dispute surrounding the presumption under s 19B.

3. The applicant’s father, who was living at the same premises as the deceased, the applicant and the second and third respondent’s, tested positive for COVID-19 on 12 February 2022 with the deceased testing positive a short time later on 14 February 2022. There was a real dispute as to whether the deceased would have come into contact with, and contracted the virus, in the course of her employment or whether she contracted at home.

4. The matter was the subject of not only factual evidence but also three expert opinions. There was a real dispute between the experts as to how the deceased came to contract the virus. The respondent relied on the opinion of Professor Wakefield AO who provided a report dated 2 June 2023 when denying liability.

5. It needs to be remembered in the context of the development of the matter and the dispute, that the opinion of Professor Wakefield remained unchallenged by countervailing expert opinion until the applicant obtained a report from Professor Christopher Grainge dated 11 July 2024. The first respondent subsequently obtained a supplementary report from Professor Wakefield dated 16 September 2024 having been briefed with further relevant documents including the report of Professor Grainge. The second respondent did not obtain an expert opinion until a report was obtained from Associate Professor Hudson dated 5 February 2025 following which the first respondent obtained a further supplementary report from Professor Wakefield dated 18 February 2025 after briefing him with a copy of the reports of Professor Grainge and Associate Professor Hudson.

6. Following the filing of the proceedings on 8 October 2024 directions were made by delegate Candy Young of the Commission on 10 October 2024 which relevantly referred the parties to Procedural Direction WC1 in respect to informing all potential dependents of the claim and observed that the application only recorded one dependant, the applicant, whilst indicating that Harrison and Matilda may have been dependant and whilst the evidence attached to the Application indicated two further potential dependants being the deceased’s parents.

7. The Direction observed that there was no evidence attached to the Application indicating whether the children of the deceased and the applicant or the deceased’s parents had been contacted about their potential rights, or any formal acknowledgement as to whether they intended to make a claim. Directions were made in respect to the applicant writing to potential dependants to inform them of their potential entitlements.

8. On 5 November 2024 the applicant lodged an Application to Admit Late Documents. Among the documents attached to the Application to Admit Late Documents were statutory declarations from both Matilda and Harrison both of which were declared on 26 October 2024. Both declared that they did not intend to make a claim for death benefits.

9. The matter was listed before me for a preliminary conference 7 November 2024 at which time it was listed for a further Preliminary Conference on 4 December 2024. Following the Preliminary Conference on 4 December 2024 Directions were issued which amended the Application to add Harrison Hayes as the second respondent and Matilda Hayes as the third respondent.

10. The third respondent lodged a Reply in the proceedings on 15 January 2025 and the second respondent on 7 February 2025. Attached to both Replies were statements from the relevant respondent which included their evidence as to dependency.

11. Whilst there may not have been any dispute that the applicant was dependent the dependents were not in my view fully particularised until the filing of the Reply by the second respondent on 7 February 2025.

12. The applicant submits that there is a common misconception that full particulars of the extent of dependency should be provided before there is an entitlement to interest. The legislation in the respondent’s submission speaks only in terms of “a claim” being duly made.

13. In the applicant’s submission the impediment for the first respondent in making the lump sum death benefit payable was not the provision of particulars as to dependency as it was always clear that the applicant and the second and third respondents were dependant on the deceased but rather that the first respondent disputed liability. The second respondent also submits that there could be no doubt that both the second and third respondents were dependents of the deceased.

14. I accept that the dispute in respect to liability was an impediment however as previously discussed in my view there was real substance to that dispute, and it was a dispute in respect to which the evidence developed overtime but in respect to which the respondent had acted in a timely fashion in obtaining the expert opinion of Professor Wakefield. It was not until a year later that the applicant obtained an expert opinion which challenged the opinion of Professor Wakefield. As I observed in my previous decision the expert evidence in this matter is of a very high standard.

15. I do not however accept that the provision of particulars as to dependency was not also an impediment. As previously discussed, the second and third respondents were not listed as respondents to the Application which was filed with the Commission to commence these proceedings. They were also not identified in that application as dependants but rather as persons who may be dependant or who may be claiming to be dependant. Both the second and third respondent then declared statutory declarations on 26 October 2024 in which they both declared that they did not intend to make a claim for death benefits. Whilst it may appear obvious that the second and third respondents were dependent upon the deceased that does not necessarily mean that they would seek to claim a portion of the compensation. Whilst it was submitted on behalf of the third respondent that there could be no question that the third respondent would make a claim, the third respondent made the previously mentioned statutory declaration declaring that she would not be making a claim.  

16. Furthermore, whilst the issue of the dependence of the applicant and the second and third respondent is a significant part of the issue of dependency it is not the only issue. All potential dependants need to be identified and notified of their potential entitlement as the directions of 8 October 2024 drew the applicant and the first respondent’s attention to. The last of the responses from the potential dependents was not lodged with the Commission until the Application to Admit Additional Documents dated 3 December 2024.

17. Interest is awarded to compensate for being kept of the money not to punish the respondent.[8]

    [8] Batchelor v Burke [1981] HCA 30; (1981) 148 CLR 448.

18. Whilst the discretion in s 109 is limited in that interest cannot be awarded prior to a claim for compensation being duly made, it does not follow that any award for interest must commence from when the claim is duly made. In my view it is appropriate in the circumstances of this matter that the interest run from when the claim was fully particularised including in respect to dependency.

19. It is not until the claim was fully particularised that the first respondent could have potentially paid compensation. That could not occur, regardless of the dispute in respect to liability and s 19B, until such time as all the dependents who wished to make a claim for that compensation had been identified, given notice of the claim and provided their responses. That did not happen until 7 February 2025. As I have previously discussed I do not accept the applicant’s submission that it was inevitable that the claim would be successful. The dispute raised by the respondent was real and of substance. The respondent had acted in a timely fashion to obtain an experts report from Professor Wakefield which remained the only expert evidence in respect to liability until the applicant obtained a report from Professor Grainge dated 11 July 2024 over a year later.

20. Whilst it is true that the respondent has had use of the money which forms the lump sum death benefit payment, I also think it is appropriate to consider in exercising the discretion the nature of the fund that the compensation is being paid from. The workers compensation scheme is a statutory scheme charged with the responsibility of compensating injured workers and in some instances their dependants. It is not a private individual or business that gains a benefit from the monies but rather those who have an entitlement under the relevant legislation.

1. In the circumstances and in the exercise of the discretion under s 109 I am of the view that the applicant, second and third respondent are entitled to interest on the s 25(1)(a) lump sum death benefit compensation from 8 February 2025 to 5 June 2025.

Rate of interest

1. I agree with the first respondent’s submission that the rate of interest should not be greater than 2% above the cash rate published by the Reserve Bank of Australia (RBA). The applicant submits a rate of 2% above the RBA Cash Rate. An interest rate of 2% above the cash rate published by the RBA has been frequently applied by the Commission as noted by the first respondent at [42] of their submissions and I also adopt that rate in this matter. The interest is to be apportioned based on the amount of the s 25(1)(a) lump sum benefit to be paid to each of the applicant, second and third respondents.