Hellenic Tourism Organisation v Tzoumacas
[2005] NSWWCCPD 105
•7 September 2005
WORKERS COMPENSATION COMMISSION
DETERMINATION OF AN APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:Hellenic Tourism Organisation v Tzoumacas [2005] NSW WCC PD 105
APPELLANT: Hellenic Tourism Organisation
RESPONDENT: Freda Tzoumacas
INSURER:GIO Workers Compensation (NSW) Limited
FILE NUMBER: WCC18012-04
DATE OF ARBITRATOR’S DECISION: 17 June 2005
DATE OF APPEAL DECISION: 7 September 2005
SUBJECT MATTER OF DECISION: Sections 151A and 151C of the Workers Compensation Act 1987; election to commence proceedings in the District Court of New South Wales; preclusion from commencing proceedings for permanent loss compensation in the Workers Compensation Commission.
PRESIDENTIAL MEMBER: Deputy President Gary Byron
HEARING:Determined on the papers
REPRESENTATION: Appellant: Rankin Nathan Lawyers
Respondent: Consolidated Lawyers
ORDERS MADE ON APPEAL: The decision of the Arbitrator, dated 17 June 2005, is revoked and the following decision is made in its place:
Ms Freda Tzoumacas is precluded from commencing proceedings to recover permanent loss compensation pursuant to sections 66 and 67 of the Workers Compensation Act 1987, by reason of her election to commence proceedings to recover damages in the District Court of New South Wales on 2 November 2001.
No order is made as to the costs of this appeal.
BACKGROUND TO THE APPEAL
On 5 July 2005 the Hellenic Tourism Organisation, the Appellant, sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission, against a decision dated 17 June 2005.
Ms Freda Tzoumacas, the Applicant in the proceedings before the Arbitrator, is the Respondent in this appeal.
The Insurer is GIO Workers Compensation (NSW) Limited.
Ms Tzoumacas claims that she suffered an injury, for which non-economic loss compensation is payable, arising out of and in the course of her employment with the Appellant. She claims that she sustained an injury to her back, left leg, right leg and neck during the period 21 March 1985 to 20 July 2001, as a result of the nature and conditions of her employment, which is said to have comprised “continuous and repetitious heavy lifting, bending and carrying.” Ms Tzoumacas claims various amounts pursuant to sections 66 and 67 of the Workers Compensation Act 1987 (‘the 1987 Act’). The Insurer denied liability for the claim that she made as a result of the injury allegedly sustained.
On 3 November 2004 Ms Tzoumacas lodged in the Commission, an ‘Application to Resolve a Dispute’ in relation to this claim.
There is no dispute that on 2 November 2001 Ms Tzoumacas lodged a claim in the District Court of New South Wales for injuries sustained in the course of her employment with the Appellant. The injury, the subject of those proceedings, is the same injury in dispute before the Arbitrator.
On 8 November 2003 the matter was listed for hearing in the District Court, but the proceedings were discontinued by consent, due to Ms Tzoumacas’ failure to comply with section 151C of the 1987 Act, as it provided at the relevant date. It is not disputed that Ms Tzoumacas commenced the District Court proceedings prior to six months after notice of the injury had been given to the Appellant.
The Arbitrator set out the issue in dispute before him, in the following terms:
“The threshold issue in dispute in this application may be summarised as follows: Is the Applicant precluded from bringing these proceedings in the Commission because she is taken to have elected, pursuant to s151A of the WCA, not to seek permanent loss compensation by commencing District Court proceedings?”
DECISION UNDER REVIEW
The ‘Certificate of Determination’, dated 17 June 2005, records the Arbitrator’s orders as follows:
“The determination of the Commission in this matter is as follows:
1.The Applicant may continue with her claim before the Workers Compensation Commission, there having been no election made under section 151A
2.The Respondent to pay the Applicant’s costs as agreed or assessed.”
ISSUE IN DISPUTE
The issues in dispute in this appeal is the threshold issue as to whether the Arbitrator erred in finding that Ms Tzoumacas may continue with her claim before the Commission, there having been no election made by her pursuant to section 151A of the 1987 Act, as provided at the relevant time.
ON THE PAPERS REVIEW
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998, (‘the 1998 Act’) provides:
“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
The Appellant makes no submission as to whether the appeal should be determined without any conference or formal hearing. Ms Tzoumacas states that this issue is “not applicable”. Having regard to Practice Directions Numbers 1 and 6 and the documents that are before me, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
LEAVE
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act.
.
The amount of compensation at issue on appeal exceeds $5,000, but the Arbitrator made no award of compensation in the decision appealed against, in this matter. Consequently, section 352(2)(a) of the 1998 Act is satisfied and section 352(2)(b) has no application (Mawson v Fletchers International Exports Pty Limited [2002] NSW WCC PD 5; ADCO Constructions Pty Ltd v Ferguson [2003] NSW WCC PD 21; Fletchers International Exports Pty Limited v Regan [2004] NSW WCC PD 7).
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
Leave to appeal is granted.
EVIDENCE AND SUBMISSIONS
The evidence and submissions made by the parties to the Arbitrator are before me in this appeal and have been taken into account.
Appellant’s submissions on appeal
The Appellant refers to submissions made in the proceedings before the Arbitrator and states that it relies upon those submissions, including the submission that, by making the election to commence the District Court proceedings for common law damages, Ms Tzoumacas had made an election under the former section 151A of the 1987 Act and therefore, could not also seek permanent injury compensation.
The Appellant submits that the Arbitrator erred in preferring Ms Tzoumacas’ contention that as the District Court proceedings had been commenced in contravention of section 151C of the 1987 Act, and in finding that the condition precedent for commencement of the proceedings had not been satisfied and the proceedings were invalid, and that no effective election under section 151A of the 1987 Act had been made.
The Appellant submits that the Arbitrator failed to correctly follow the Court of Appeal in Gordon v Berowra Holdings Pty Ltd [2005] NSWCA 27 (‘Gordon’), and points out that in the more recent Court of Appeal decision in Brighton Und Redfern Plaster Pty Ltd v Boardman [2005] NSWCA 167, the Court noted at [3]:
“… this Court decided in Gordon v Berowra Holdings Pty Limited (2005) NSWCA 27 that non-compliance with s 151C did not render proceedings a nullity and that the non-compliance could be waived.”
It is further submitted that the Arbitrator accepted this finding at paragraphs 32 and 33 of his ‘Statement of Reasons for Decision’, but then goes on to distinguish the proceedings before him from the Gordon situation, “where a Defendant at a very late stage sought to assert the proceedings were a nullity so as to void acceptance of an Offer of Compromise which had been served prior to the Defendant appreciating that a full defence to the claim could be asserted through the action of s151C.”
The Appellant submits that the Arbitrator erred in determining at paragraphs 37-39 of his ‘Statement of Reasons for Decision’ that the action of “the Respondent/Defendant in these proceedings to assert the s151C defence at an early stage distinguishes the Gordon decision from the question of law for determination in these proceedings.” It is further submitted that once it is accepted, as in Gordon, that invalid commencement of proceedings does not render those proceedings a nullity, a defence that is later asserted has no bearing on whether an election is made or not.
The Appellant cites State of NSW v Connor [2003] NSWCA 200 in further submitting that an irrevocable election is made by the filing of a Statement of Claim and the conduct of a party after that point, “in assertion or not of the non-compliance will influence only the nature of the Defence, not the effect of the earlier election.” The Appellant contends that the election must by its nature come before any response by a Defendant and that the Arbitrator erred in finding that “the later action of the Defendant/Respondent in this matter has in some way altered the character of, and has in fact negated, the election to pursue common law damages rather than the statutory entitlements of sections 66 and 67 of the Act.”
Finally, the Appellant cites the decision of the Commission in Sandarousi v L & A Pressure Welding Pty Ltd [2005] NSW WCC PD 59, and refers to paragraph 29 of that decision in which it is concluded that the District Court proceedings commenced by Mr Sandarousi were not null and void and of no legal affect as claimed, and points to the finding that the Mr Sandarousi was precluded by the operation of section 151A of the 1987 Act, from commencing proceedings for payment of compensation pursuant to sections 66 and 67 of the 1987 Act.
Ms Tzoumacas’ submissions on appeal
Ms Tzoumacas submits that the Arbitrator did not err in his determination and did not incorrectly apply the various authorities referred to by the Appellant “at first instance”.
Ms Tzoumacas relies on her submissions made before the Arbitrator and on the Arbitrator’s findings and reasons, including his “application and differentiation” of Gordon as set out in paragraphs 29 to 39 of his ‘Statement of Reasons for Decision’.
Specifically, Ms Tzoumacas submits that the Appellant is incorrect in stating that the Arbitrator accepted the finding in Gordon “namely, that the commencement of proceedings in contravention of s.151C does not render those proceedings a nullity.” It is submitted that the Arbitrator was simply outlining the findings of the Court of Appeal in Gordon, “and clearly he does not provide an opinion on this finding.”
Ms Tzoumacas relies upon the Arbitrator’s finding at paragraph 40 of the ‘Statement of Reasons for Decision’ that the “Applicant not having validly commenced the proceedings in the District Court, had not made a valid election, nor can be taken to have made that election, pursuant to s151A(2).”
Finally, Ms Tzoumacas submits:
“If one was to apply the principles discussed by Glass JA in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 390 in particular;
‘… the test for determining the issue of validity is to ask what was the purpose of the legislation?…in determining the question of purpose, regard must be had to the language of the relevant provision and the scope and object of the whole statute.’
surely it can then be said that the legislation was not designed to ‘deprive a person of their rights to claim merely because of some technical oversight or misunderstanding or even bad advice’, which is what the Commission is faced with in the present circumstances. And should this be accepted, and the decision of the Arbitrator is not affirmed; then the Respondent will suffer an injustice, one that was not purported by the legislation.”
DISCUSSIONS AND FINDINGS
The submissions made in this appeal and before the Arbitrator are very similar to those that have been made previously in the Commission, in matters touching upon this particular threshold issue. Indeed, the arguments put and the authorities cited have been substantially the same in each case.
The Arbitrator at paragraphs 32 and 33 of his ‘Statement of Reasons for Decision’ refers to the decision in Gordon. The parties in the instant case are at odds as to whether the Arbitrator “accepted” the finding of the Court of Appeal. I agree with Ms Tzoumacas that the Arbitrator was outlining the findings of the Court in Gordon and was not specifically expressing his acceptance or otherwise.Nevertheless, the Commission is bound by the decisions of that Court.
The Arbitrator seeks to distinguish this case from Gordon on the basis that, in that case, the parties had proceeded without regard to section 151C of the 1987 Act, to list the matter for hearing, to make, offers and to “generally ignore the provisions of s151C until virtually the last moment before the proposed hearing.”
However, I agree with the Appellant that once it is accepted, per Gordon, that invalid commencement of proceedings does not render the proceedings a nullity, a defence that is later asserted has no bearing on whether an election has been made or not.
The Arbitrator said at paragraph 39:
“The non-compliance with s 151C was raised in the defence to the statement of claim and the consent orders filed with the District Court discontinuing the proceedings were entirely due to the Plaintiff’s failure to comply with s151C. In these circumstances, although the lodging of the application otherwise than in accordance with s151C could not be considered a nullity, the non-compliance with the condition precedent meant that the Plaintiff had not effectively commenced proceedings in a court to recover damages and, unlike in Gordon, there was no set of circumstances which would have allowed the District Court to allow the proceedings to continue to finality despite that initial non-compliance.”
In my view, notwithstanding that the proceedings commenced may have been incompetent, it does not mean that they were not commenced at all (Cardona v Penrith City Council [2003] NSW WCC PD 36. I do not agree with the Arbitrator in the instant case that, “… the Plaintiff had not effectively commenced proceedings in a court to recover damages …” Clearly, proceedings were commenced within the meaning of section 151A(3)(a), as it then was, which provided, inter alia, that a person makes the election, or is taken to have made that election, by commencing proceedings in a court to recover those damages. Proceedings were commenced by the filing of a Statement of Claim in the District Court. Whether or not the District Court would have allowed the proceedings to continue to finality despite the initial non-compliance, as proposed by the Arbitrator, is another matter.
In Gordon, the Court of Appeal held that section 151C of the 1987 Act, as it then was, is a condition precedent of a procedural nature that must be satisfied before the commencement of proceedings. However, the Court further found that proceedings commenced in contravention, “at least in an inferior court”, are not a nullity or void. While stating that the authorities cited at [36] in support of this finding, all recognised that the purpose of provisions such as section 151C of the 1987 Act were to promote settlement before commencement of court proceedings, Mason P went on to say at [40] “It is, however, fallacious to conclude that proceedings in breach have failed to engage the jurisdiction of the court, or are a nullity.”
Mason P further stated, inquiry should be made to discern from the legislative scheme an intention that invalidity or nullity will be the consequence of non-compliance with a prohibition, however clearly it is expressed. He observed at [49], (Sheller and Beazley JJA agreeing), that section 151C(1) “does not erect a jurisdictional preclusion.” The Court of Appeal held accordingly, that the section was not found to reflect the requisite legislative intention that nullity is the consequence of non-compliance, as per the principles stated in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 358.
The relevant section of the 1987 Act has been amended subsequent to the election having been made by Ms Tzoumacas, perhaps, as stated in her submissions, to avoid depriving a person of their rights to a claim because of “some technical oversight or misunderstanding or even bad advice”. It is unfortunate in this and similar cases, that parties having made the election, are precluded from entitlement for permanent loss compensation, by reason of the operation of the then applicable statutory provisions. However, in view of the law as it then stood, I must find that the proceedings commenced in the District Court by Ms Tzoumacas, were not a nullity and that the election to commence those proceedings, was a valid election under section 151A(2) of the 1987 Act. I find accordingly. (See also He v L & J Precision Joinery & Kitchen [2005] NSW WCC PD 100; Wide Hanson Bros Pty Ltd v Zhen Xiu Cai [2005] NSW WCC PD 93; Sydney Water Corporation v Singh [2005] NSW WCC PD 92; Thien Vu Huynh v Andison International Pty Ltd [2005] NSW WCC PD 86; Maiorana v Ranieri & Giubega Pty Ltd t/as All Seasons Fruit Market [2005] NSW WCC PD 85, and Sandarousi v L & A Pressure Welding Pty Ltd [2005] NSW WCC PD 59).
I find that the Arbitrator erred in finding that Ms Tzoumacas did not make an irrevocable election under section 151A of the 1987 Act, despite filing a Statement of Claim in the District Court of New South Wales and that those proceedings were not validly commenced. In the circumstances, Ms Tzoumacas is not entitled to continue with her claim in the Workers Compensation Commission. Accordingly, the appeal is successful.
DECISION
The decision of the Arbitrator, dated 17 June 2005 is revoked and the following order is made in its place:
Ms Freda Tzoumacas is precluded from commencing proceedings to recover permanent loss compensation pursuant to sections 66 and 67 of the Workers Compensation Act 1987 by reason of her election to commence proceedings to recover damages in the District Court of New South Wales on 2 November 2001.
COSTS
No order is made as to the costs of this appeal.
Gary Byron
Deputy President
7 September 2005
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF GARY BYRON, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
0
4
0