Klinkert v Australian Postal Corporation
[1992] FCA 482
•26 JUNE 1992
Re: JOHANNA HENDERIKA KLINKERT
And: AUSTRALIAN POSTAL CORPORATION
No. V G347 of 1991
FED No. 482
Administrative Law
COURT
IN THE FEDERAL COURT OF AUSTRALIA
VICTORIAN DISTRICT REGISTRY
GENERAL DIVISION
Hill J.(1)
CATCHWORDS
Administrative Law - appeal from Administrative Appeals Tribunal - compensation claim by Commonwealth employee - accident on 12/2/1985 - law applicable to determine liability - law applicable to calculation of periodic compensation - whether wrong law applied - whether error of law immaterial to result
Compensation (Commonwealth Government Employees) Act 1971 (Cth), ss 26, 27, 46
Commonwealth Employees' Rehabilitation and Compensation Act 1988 (Cth), ss 19, 124(1A)
HEARING
MELBOURNE
#DATE 26:6:1992
Counsel for the Applicant: A. Moulds
Instructed by: McMullin Coate and Co
Counsel for the Respondent: M. McInnis
Instructed by: Hall and Wilcox
ORDER
THE COURT ORDERS THAT:
1. The appeal be allowed.
2. The order of the Tribunal be varied by rescinding orders (ii) and
(iii) and replacing them with the following:
(ii) that the applicant has on and from that date been incapacitated for work; and
(iii) that the respondent assess the amount of compensation to be paid to the applicant pursuant to section 19 of the Commonwealth Employees' Rehabilitation and Compensation Act 1988 in accordance with the findings of fact set out in the Tribunal's reasons.
3. The respondent pay the applicant's costs.
Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
JUDGE1
The applicant, Ms Johanna Henderika Klinkert, appeals against the decision of the Administrative Appeals Tribunal constituted by a deputy president, Mr Forrest, which set aside a decision of the respondent, the Australian Postal Commission, and remitted that decision for reconsideration in accordance with certain directions. Those directions were in the following terms:
1. That the respondent is and has on and from 8 November 1990 remained liable to pay compensation to the applicant.
2. That the applicant has on and from that date been partially incapacitated for work; and
3. That on and from that date the amount which the applicant is able to earn in some suitable employment is the amount which would be paid to a shop assistant whose duties did not involve any heavy lifting, prolonged walking, standing or bending and whose hours of work did not exceed 30 per week.
Ms Klinkert suffered, while an employee of the respondent, a lower back problem. She claimed that it was work-related. That claim was initially accepted, and on 30 August 1985 a determination of liability was made in her favour for "chronic back strain" sustained in the course of her employment with the respondent or its statutory predecessor on 12 February 1985. The determination was made pursuant to the provisions of the Compensation (Commonwealth Government Employees) Act 1971 ("the old Act").
Thereafter determinations were made from time to time under the old Act. On 1 December 1988 the Commonwealth Employees' Rehabilitation and Compensation Act 1988 (Cth) ("the 1988 Act") commenced. Determinations after that date were made by the respondent under the 1988 Act until 8 November 1990 when the respondent determined to cease liability on and from that date. The application to the tribunal was for a review of that determination.
Before the tribunal it would seem that the principal issue, so far at least as the respondent was concerned, was whether the applicant suffered a real incapacity related to her employment. There was medical evidence which suggested that she suffered from no medical condition at all, and it was on the basis of this evidence that the respondent had decided to determine compensation. Before the tribunal the applicant was successful on this issue. The tribunal found, and the finding is now accepted by the respondent, that the applicant had a residual disability in her back as a result of work-related back strain which incapacitated her for work.
There was however a second matter before the tribunal which arose only if the first was determined favourably to the applicant, namely the basis upon which compensation to her should be calculated. The parties did not contemplate that the tribunal would itself make that calculation.
Before the tribunal there was some confusion in the submissions of the applicant as to the relevant law. It is fair to say that counsel for the applicant submitted that the better view was that, in a case such as the present, there had to be shown liability under the old Act, whereupon compensation was to be calculated under the 1988 Act. However it would seem that counsel made alternative submissions depending upon whether compensation was payable to the applicant under the old Act or under the 1988 Act.
In the present appeal, which is brought to the court pursuant to the provisions of s44 of the Administrative Appeals Tribunal Act 1975 (Cth), the applicant claims that the tribunal in its reasons and in the directions which it gave wrongly applied the old Act when the question of the basis of compensation should have been determined under the 1988 Act. So stated, a question of law would arise if indeed the tribunal did apply the wrong law. Although at first counsel for the parties were reluctant to concede it, there was no real difference between them as to the applicable law to be applied, nor could there be. The matter is free from the difficulties which were discussed by the High Court in the recent decision of Esber v The Commonwealth (3 June 1992, unreported).
While the 1988 Act repeals the old Act, s124(1A) of the 1988 Act provides relevantly:
"Subject to this part, a person is entitled to compensation under this Act in respect of an injury, loss or damage suffered before the commencing day if compensation was, or would have been, payable to the person in respect of that injury, loss or damage under the ... 1971 Act."
Thus compensation was, if otherwise appropriate, payable to the applicant in respect of the period after 1 December 1988 under the 1988 Act. However it was a necessary prerequisite that the applicant be a person to whom compensation was payable in respect of an injury under the old Act. Under the provisions of the old Act the issue of liability arose under s27(1) which provided:
"If personal injury arising out of or in the course of the employment of an employee by the Commonwealth is caused to the employee, the Commonwealth is, subject to this Act, liable to pay compensation in respect of that injury in accordance with this Act."
Putting to one side medical expenses and the like, in a case such as the present, weekly compensation became payable under the old Act under either s45 or s46. Which section applied depended on whether the injury resulted in the employee being totally incapacitated for work when the provisions of s45 applied, or whether the injury resulted in the employee being partially incapacitated for work when the provisions of s46 applied.
If a person was partially incapacitated, the weekly compensation payable depended inter alia upon the amount per week that the employee was able to earn in some suitable employment or business. In calculating that amount, the commissioner was required to have regard to the matters in s46(4A) including paragraph (d) which is in the following terms:
"in a case where, after becoming partially incapacitated for work, the employee has failed to seek suitable employment - the amount per week that, having regard to the state of the labour-market at the relevant time, the employee could reasonably be expected to earn in such employment if the employee had sought, obtained and were engaged in such employment."
The commissioner was directed also to have regard to any other matters that he considered relevant: para (e). Section 26 of the old Act in an appropriate case aided in determining which of sections 45 or 46 applied. Section 26 as in force prior to 5 September 1985 provided:
"For the purposes of this Part, an employee shall be deemed to be totally incapacitated for work if his incapacity is such that he is fitted only for employment of a kind that is not commonly available and employment of that kind is not reasonably available to him. "
On the other hand, compensation under the 1988 Act becomes payable under s19 of that Act. That section relevantly provides for compensation for all employees incapacitated for work as a result of injury whether that injury be total or partial. It too adopts a formula which takes into account the amount per week (if any) that an employee is able to earn in suitable employment. In determining that amount the relevant authority is required, relevantly to the facts of the present case, to consider various matters as set out in paragraphs (e), (f) and (g) of s19(4). These paragraphs provide as follows:
"(e) where, after becoming incapacitated for work, the employee has failed to seek suitable employment - the amount per week that, having regard to the state of the labour-market at the relevant time, the employee could reasonably be expected to earn in such employment if he or she were engaged in such employment;
(f) where paragraph (b), (c), (d) or (e) applies to the employee - whether the employee's failure to accept an offer of employment, to engage, or to continue to engage, in employment, to undertake, or to complete, a rehabilitation or vocational retraining programme or to seek employment, as the case may be, was, in the Commission's opinion, reasonable in all the circumstances; and
(g) any other matter that the Commission considers relevant."
It can be observed for the moment that there are the following relevant differences, apart from the mathematical formulae involved, between the scheme for weekly compensation under the old Act and that applicable under the 1988 Act. First the formula to be adopted under the 1988 Act does not depend upon whether there is partial or total incapacity. All that is required to bring s19 into play is that there be "incapacity".
Secondly, the formula in s46(2) of the old Act is dependent upon the amount which the employee is able to earn in "some" suitable employment. In s19 the word "some" is omitted. It is arguable that this could perhaps make a difference. The provisions of para (b) of s46(4A) and para (e) of s19(4) of the 1988 Act are identical.
Next, the language of paragraph (f) directed attention to reasonableness and that of paragraph (d) of s46(4A) is substantially similar and the difference between the wording of the two subsections would appear to be totally immaterial except so far as there is a reference in s19(4)(f) to undertaking or completing a rehabilitation or vocational programme. I shall return to that matter later. Finally, both sections direct the commissioner to have regard to such other matters as are considered relevant.
A perusal of the tribunal's reasons leaves me in no doubt at all that the tribunal considered only the old Act. The tribunal stated at the outset that the initial determination was made under the old Act. Although it referred to the later determinations, some of which in fact, as I have mentioned, purporting to be made under the 1988 Act, the reasons make no reference at all to the fact that they were purported to be made under the 1988 Act.
The tribunal next said that the old Act governed entitlement to compensation. That is of course true. It referred to decisions of Re Willis and Australian Telecommunications Commission and The Commonwealth (No 2) (1989) 19 ALD 665 approved by this court in Behan v Australian Telecommunications Corporation (1990) 26 FCR 337, both of which decisions refer to s124(1A) of the 1988 Act and are authority for the proposition for which they are cited. However, after finding that the applicant's injury arose out of or in the course of her employment by the Commonwealth to found an entitlement to compensation under s26(1) of the old Act, the tribunal went on to consider as the next issue whether the applicant was wholly or partially incapacitated, an inquiry relevant only to the old Act and not at all to the 1988 Act. At most all the tribunal was required to do at that stage was to determine that there was an incapacity which was either partial or total.
A considerable part of the reasons is taken up in determining whether s26 of the old Act applied. This was said to be "necessary for the purposes of s26 of the Act to determine the extent of her (the applicants) incapacity."
To be fair to the tribunal the submissions of counsel for the applicant may have sent the tribunal down this path. The submissions of counsel for the applicant required, so he said, firstly having "a look at the 1971 Act as it may apply in terms of the question of incapacity in this case and then (having) a look at the new Act and (seeing) where either of those situations would lead."
The tribunal after some references to s26 in argument then asked counsel for the applicant:
The Deputy President: "Are you saying that it - is it your case that 26 should apply from the old Act to your client?" Mr Moulds: "Yes, sir."
After further submissions concerning s26 counsel said:
"If the tribunal is of the view that the new Act is that which - that is s19 of the new Act which Australia Post - and which I emphasise Australia Post seems to be under the impression it is the wrong Act - then in my submission s19 of the Act is the relevant section to apply."
The Deputy President then indicated that he was on record as saying in cases where injuries had occurred prior to the commencement of the 1988 Act that the old Act does apply. The following exchange then followed indicating at the least confusion and probably misunderstanding between counsel and the Deputy President:
Mr Moulds: "In terms of partial and total?"
Deputy President: "Entitlement."
Mr Mould: "Yes. Well is that is that entitlement, partial just -" Deputy President: "Yes, as far as following - when you say the new Act applies, are you talking about liability?" Mr Moulds: "Or the entitlement and liability I suppose mean much the same thing."
The Deputy President asked if there was an alternative argument if s26 did not apply. Mr Mould said that the old Act applied. This could be a reference to the state of law pre s26 having regard to submissions put by counsel as to the amendments to that section.
Whatever the explanation, the reasons of the tribunal considered the application to the facts of the case of s26 and in this context the tribunal made a series of factual findings said by it to be relevant to the application of s26. These included:
(a) that the applicant demonstrated an eagerness to work;
(b) that she had not been offered work by Australia Post;
(c) that she had not sought employment outside Australia Post;
(d) that her prospects of attracting an employer did not appear strong;
(e) that she was limited to light duty employment such as that of a shop assistant which did not require any heavy lifting;
(f) that competition in the Shepparton district where the applicant resided was intense;
(g) that where labour supply exceeded demand employers were generally reluctant to give preference to persons who had been absent from the workforce for a considerable period on compensation benefits;
(h) that Australia Post had no suitable work available for the applicant;
(i) that the applicant was fit for counter work in Australia Post which in effect was comparable to that of a shop assistant in a food shop where her duties did not require the lifting of any heavy items, prolonged walking, standing or bending;
(j) that the reality was that the likelihood of her obtaining employment in the town of Stanhope where she resided was remote and that given the time it would take travelling to and from work and her back condition it was reasonable that she be expected to work no more than 30 hours a week;
(k) that she had established an incapacity for work in her former employment as a postal officer.
These findings, except for the last two, preceded the following comment made by the Deputy President:
"The difficulty for the applicant is that she has not sought work in any other sphere. If she had unsuccessfully sought such work as is within her capacity then I would have had evidence upon which a finding could be made. The applicant freely acknowledges she is fit for counter work in Australia Post which, in effect, is comparable to that of a shop assistant in, for example, a food shop. If, at the end of the day there was evidence she had tested the labour market and taken all reasonable steps to obtain work in the Goulburn Valley region which might reasonably be available and had been unsuccessful in her endeavours and, given that Australia Post has no suitable work for her, I may have been persuaded to make a finding in her favour under s26. However, the evidence before me does not justify adopting that course.
The tribunal then proceeded to set aside the determination and make the directions complained of.
I should now mention two further matters. The first is that in the meantime the respondent has re-employed the applicant, a matter twice recommended in his reasons by the deputy president. Secondly, the respondent has in the meantime made a calculation of weekly compensation said from the bar table to take account of the deputy president's directions, but said also to have been made under the 1988 Act. I accepted a tender of correspondence recording that calculation, not because it could throw any light on whether the tribunal erred in law but only to the extent that the fact of the making of the calculation purportedly under the 1988 Act might have relevance to the question whether the tribunal's error of law, if there was one, might have been immaterial, or as to whether the calculation subsequently made might have relevance to the question of costs. I was told that the applicant was dissatisfied with the new calculation made by the respondent and has sought review of it.
As I have already indicated, it is obvious that the tribunal at no stage directed attention to the relevant considerations under the 1988 Act. It considered the question before it, including the directions to be given to the respondent in making a calculation solely under the old Act. In respect of what may be called the threshold issue of entitlement to compensation at all (s124(1A) of the 1988 Act) this was clearly correct. In respect of any matter directed to the calculation of compensation which involved an error of law, the tribunal did not at any stage direct its attention to the requirements of s19 of the 1988 Act in framing the directions to the respondent to calculate compensation. The very words of the order made reflect the matters arising under s46 of the old Act.
Counsel for the respondent submitted that even if I were to find, contrary to his submissions, that the tribunal had made an error of law, that error was immaterial and that the matters set out in the directions were in any event equally applicable to s19 of the 1988 Act. He urged me for this reason to dismiss the application. This is a matter which has caused me considerable concern for it is clear that if an error of law is exposed which can have no materiality to the tribunal's conclusions, the court will not send the matter back to the tribunal or alter the tribunal's order: Casarotto v Australian Postal Commission (1989) 86 ALR 399 at 401, BTR Plc v Westinghouse Brake and Signal Co (Australia) Limited (1992) 106 ALR 35 at 41-2 per Lockhart and Hill JJ. and cases there cited, and cf Commonwealth v Angel (5 March 1992, unreported) per Davies J at p13.
With some doubt, I have decided that the error into which the tribunal fell, while it might be immaterial, could not be said to have been such which could not have affected the forming of the directions which the tribunal gave to the respondent. To start with, the direction to take into account the fact that the applicant was, from 8 November 1990, partially incapacitated for work to the extent set out in the reasons raises a matter, at least in part, irrelevant to the termination under s19. What was the respondent to do when directed to take into account an irrelevant matter? The reference to the extent of incapacity is a reference to a conclusion based, at least in part, upon the wording of s26 rather than matters relevant to s19 of the 1988 Act.
The fact is that the respondent, faced with the directions made by the tribunal, might well have understood that it was required to consider the question of the calculation of compensation, either under the old Act or at the least under s19 of the 1988 Act for which purpose s26 of the old Act had some residual significance. While the respondent clearly did see its obligations as being to consider the matter under s19 of the 1988 Act, the allusion to s26 and the decision and reasons might nevertheless have been taken into account by the respondent and vitiated its decision.
While s46 of the old Act and s19 of the 1988 Act contain, as I have already illustrated, concepts which overlap, they are not identical. Particularly, the reference to the relevant authority being required by each section to take into account such other matters as are relevant would not necessarily result in the same matters being relevant under either Act. Where a statute requires a decision maker to take into account such other matters as are relevant or as are considered by him to be relevant, what matters may properly be regarded as relevant will depend upon the context of the Act: Giris v Commissioner of Taxation (1969) 119 CLR 365 at 384 per Windeyer J; Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39-40 per Mason J.
Under the old Act, the considerations which were relevant might need to be construed, having regard in an appropriate case, to the provisions of s26 and, at the least, that section might colour the context of relevant matters to be determined under s46. Under the 1988 Act the application of s26 is a matter which in the context of that Act might have no relevance at all. The difference in wording between some suitable employment as used in the old Act and suitable employment as used in the 1988 Act may also have some possible relevance to the question of relevant matters.
Despite submissions by counsel for the applicant to the contrary, I do not as presently advised think that the reference in s19(4)(f) to undertaking or completing a rehabilitation or vocational programme has any significance in the present case. Those matters, despite the initial words of paragraph (f), which ensure that the paragraph applies to a case of failure to seek suitable employment, paragraph (e), as well as paragraphs (b), (c) and (d), seem apposite only to a case of failure to undertake or to complete a rehabilitation or vocational training programme, a matter referred to in paragraph (d) of the subsection, which appears to have no relevance in the present case.
On the other hand, the fact that no such programme was offered, if that be the case, to the applicant could be a relevant factor under para (d) in the determination of the amount per week which the employee was able to earn in suitable employment. In this regard, I note the evident policy of all governments in Australia, state and federal, to encourage rehabilitation and vocational training.
The parties were agreed that should I decide that the tribunal had made an error of law which I believed was or at least could be material to the outcome, I should not remit the matter to the tribunal for further reconsideration but rather amend the order made by the tribunal to reflect the position that the respondent was required to calculate the quantum of consideration under s19 of the Act. In the circumstances, I would allow the appeal and vary the order of the tribunal by substituting for paragraphs (ii) and (iii) the following new paragraphs:
(ii) that the applicant has on and from that date been incapacitated for work; and
(iii) that the respondent assess the amount of compensation to be paid to the applicant pursuant to section 19 of the Commonwealth Employees' Rehabilitation and Compensation Act 1988 in accordance with the findings of fact set out in the Tribunal's reasons.
Although the tribunal's error may in part have resulted from a confusion engendered by the submissions for the applicant, the application has been opposed by the respondent and the applicant has been successful in it. I am therefore of the view that, far from the application being frivolous, as was faintly put by counsel for the respondent, perhaps thereby suggesting that the respondent's costs should be paid by the applicant or even on an indemnity basis, the appeal was in my view properly brought and the respondent should pay the applicant's costs of it.
I make orders that the appeal be allowed, that the tribunal's orders be varied as I have indicated, and that the respondent pay the applicant's costs of the appeal.
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