Lovett McCracken & Bray Pty Ltd v Gales
[2007] NSWWCCPD 198
•19 September 2007
| WORKERS COMPENSATION COMMISSION | |||||
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | |||||
| STATUS: Decision confirmed on Appeal: Gales v Lovett McCracken & Bray Pty Ltd [2008] NSWCA 171; (2008) 6 DDCR 352 | |||||
| CITATION: | Lovett McCracken & Bray Pty Ltd v Gales [2007] NSWWCCPD 198 | ||||
| APPELLANT: | Lovett & McCracken & Bray Pty Ltd | ||||
| RESPONDENT: | Frank Albert Gales | ||||
| INSURER: | QBE Workers Compensation (NSW) Ltd | ||||
| FILE NUMBER: | WCC1123-07 | ||||
| DATE OF ARBITRATOR’S DECISION: | 15 May 2007 | ||||
| DATE OF APPEAL DECISION: | 19 September 2007 | ||||
| SUBJECT MATTER OF DECISION: | Whether decision of an interlocutory nature; whether a commutation agreement extinguished liability in respect of compensation claimed after the date of the agreement. | ||||
| PRESIDENTIAL MEMBER: | Acting Deputy President Robin Handley | ||||
| HEARING: | On the papers | ||||
| REPRESENTATION: | Appellant: | QBE Workers Compensation (NSW) Ltd In-House Legal Department | |||
| Respondent: | Turner Freeman Lawyers | ||||
| ORDERS MADE ON APPEAL: | The decision of the Arbitrator issued on 15 May 2007 is revoked and the following decision is substituted: | ||||
| “1. Award for the Respondent in respect of the Applicant’s claims for compensation for skin cancer. | |||||
| 2. No order as to costs.” | |||||
| There is no order as to the costs of this appeal. | |||||
BACKGROUND TO THE APPEAL
On 12 June 2007, Lovett McCracken & Bray Pty Ltd (‘LMB’) sought leave in the Workers Compensation Commission (‘the Commission’) to bring an appeal against the decision of an arbitrator issued on 15 May 2007. The Respondent to the appeal is Frank Gales. LMB’s workers compensation insurer is QBE Workers’ Compensation (NSW) Ltd (‘QBE’).
Mr Gales was born on 16 March 1936 and is aged 71. He was a merchant seaman from 1951 until March 1981, when he commenced employment with LMB as a deckhand/tug driver. Mr Gales resigned from that employment in July 1996 on medical grounds. Mr Gales made a number of workers compensation claims between 1991 and 2006 in respect of various injuries, including back and neck injuries, injuries to his legs and arms, ‘boilermaker’s deafness’, and skin cancer.
On 23 March 1999, Mr Gales commenced proceedings in the Compensation Court of NSW in respect of injuries to his neck, back, right and left legs, and right and left arms. On 30 March 2000, he agreed to a commutation of his claims. The Short Minutes of Order signed by the parties on 30 March 2000 and approved by the Court (Geraghty J) on that date, provided that the employer’s liability to make weekly payments in respect of the injuries referred to in the ‘Application for Determination’ may be redeemed and commuted by payment of the sum of $35,000. Clause 5 of the Short Minutes stated that the worker agrees that the said lump sum also redeems liability under sections 10 (in respect of hospital and medical expenses) and 16 (lump sum payments) of the Workers Compensation Act 1926 and “removes liability under Divisions 3 and 4 of Part 3” of the Workers Compensation Act 1987 (‘the 1987 Act’). Division 3 concerns compensation for medical, hospital and related expenses; Division 4 concerns compensation for non-economic loss, including compensation for permanent impairment and pain and suffering. An Annexure to the Short Minutes amended the ‘Application for Determination’ to include additional injuries including “skin cancer, severe facial disfigurement and severe bodily disfigurement”.
On 12 July 2006, Mr Gales’ solicitors lodged a claim with QBE for compensation in respect of skin cancer – materially aggravated, exacerbated, and accelerated, as a result of the nature and conditions of his employment.
On 22 February 2007, the Commission registered Mr Gales’ ‘Application to Resolve a Dispute’ in respect of his claim for medical expenses and compensation for permanent impairment and pain and suffering. On 14 March 2007, QBE lodged a ‘Reply’. On 29 March 2007, the Arbitrator conducted a teleconference with the parties. On 26 April 2007, conciliation having proved unsuccessful, the Arbitrator conducted an arbitration hearing. On 15 May 2007, the Commission issued the Arbitrator’s decision in the terms set out below.
THE DECISION UNDER REVIEW
The ‘Certificate of Determination’, dated 14 May 2007, records the Arbitrator’s orders as follows:
“1. Award in favour of the Respondent in respect of the Applicant’s claim for s 60 of the 1987 Act medical expenses.
2. The issue of s 66 lump sums is remitted to the Registrar.”
In the Statement of Reasons for his decision, the Arbitrator said the issue for him to determine was whether Mr Gales was precluded from pursuing his claims because of the commutation approved by the Compensation Court on 30 March 2000. With regard to Mr Gales’ claim for medical expenses, the Arbitrator said Mr Gales made a claim for section 60 expenses in 1999 in respect of injury in the period of employment to 1996, with a theoretical deemed date of injury of the last date of employment (12 July 1996). The Arbitrator erred in this regard since, as will appear later, the deemed date of injury should have been the date of claim, that is 17 May 1999. However, the Arbitrator said that since the claim was made in 1999, before the commutation, Mr Gales’ rights as to the injury established under section 60 of the Act in effect at that time “were extinguished by the commutation”. This was not in issue in the appeal.
With regard to Mr Gales’ claim for compensation for permanent impairment (pursuant to section 66 of the 1987 Act) and pain and suffering (pursuant to section 67), the Arbitrator referred to section 51 of the 1987 Act in effect at the time of the commutation on 30 March 2000, which provided in subsection (3):
“If –
(a) the Compensation Court determines any such lump sum; and
(b) the worker agrees that payment of the lump sum should remove any liability to make a payment under Division 3 or 4 in respect of the injury,
payment of the lump sum removes any liability to which the agreement of the worker relates.”
The Arbitrator said as the skin cancer was a disease of gradual process, and death or incapacity had not resulted from the injury, then section 15(1)(a)(ii) of the 1987 Act applies, so that the deemed date of injury is the time the worker makes a claim for compensation with respect to the injury, which was 12 July 2006. The Arbitrator followed the NSW Court of Appeal decisions in Alto Ford Pty Ltd v Antaw [1999] NSWCA 234 (‘Alto’), where it was held that there may be different dates of injury according to the entitlement claimed, and Stone v Stannard Brothers Launch Services Pty Ltd [2004] NSWCA 277 (‘Stone’), where it was held, following Alto, that the permanent impairment attributable to facial disfigurement which was the subject of a claim for compensation under section 66 could constitute an injury.
The Arbitrator noted that these two decisions had recently been followed by an arbitrator in Kruger v National (Terminals Australia) Ltd [WCC 589-07, 17 April 2007] (‘Kruger’), where a commutation had occurred and there was a later claim for compensation under section 66. The Arbitrator also referred to the Compensation Court decision of Neilson J in Mirkovic v Davids Holdings Pty Ltd (1995) 11 NSWCCR 656 (‘Mirkovic’) as authority for the proposition that a commutation or redemption does not extinguish liability for entitlements in respect of entitlements which did not exist at the time of the commutation.
The Arbitrator concluded that Mr Gales could pursue his claim under section 66 because LMB’s liability for this injury was not extinguished by the commutation approved by the Compensation Court on 30 March 2000.
ISSUES IN DISPUTE
QBE has not specifically identified its grounds of appeal, but it appears from its submissions that these support a contention that the Arbitrator made an error of law in construing the commutation agreement other than as extinguishing all further liability of the employer to the worker, as contended by QBE. In particular, QBE’s submissions suggest that the Arbitrator made an error of law in failing to properly apply section 51 of the 1987 Act in effect at the time of the commutation. The parties’ submissions are discussed below.
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.”
I have had regard to Practice Directions Numbers 1 and 6, and the documents before me. QBE submits that the appeal can be determined on the basis of these documents, while Mr Gales’ solicitors submit that an oral hearing is necessary because the appeal raises issues of a complex legal nature. Having considered these submissions and the other documents, 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.
Neither party sought to adduce fresh evidence.
LEAVE
The section 352 threshold
Before proceeding to deal with an appeal, the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act. First, there is no dispute that the appeal was lodged within 28 days of the Arbitrator’s decision as required by section 352(4) of the 1998 Act.
Second, section 352(2) requires that the amount of compensation at issue in the appeal is both at least $5,000 and at least 20% of the amount awarded in the decision appealed against. QBE submits that as the worker has claimed $28,000 compensation under sections 66 and 67 of the 1987 Act, liability for which has been denied by QBE, the amount of compensation at issue is more than $5,000 and is 100% of the amount of the award, there being no dispute that Mr Gales’ skin cancers have resulted in a whole person impairment.
I note that as no compensation has been awarded by the Arbitrator, the amount of compensation at issue is determined by reference to the amount of compensation claimed in the ‘Application to Resolve a Dispute’. (See, for example, the discussion in Fine Meats (Boners PM) Pty Ltd v Hart [2007] NSWWCCPD 164 (‘Hart’), at paragraphs 15 to 17, including reference to the decisions in Grimson v Integral Energy [2203] NSWWCCPD 29 and Fletchers International Exports Pty Ltd v Regan [2004] NSWWCCPD 7.) Mr Gales claimed a total of $28,000 under sections 66 and 67 in respect of permanent impairment and pain and suffering. Thus, the amount of compensation at issue exceeds the $5,000 threshold (section 352(a)) and, because no compensation has yet been awarded, the 20% threshold (section 352(b)) does not apply (Mawson v Fletchers International Exports Pty Ltd [2002] NSWWCCPD 5, at paragraph 22).
Accordingly, I am satisfied that the section 352 threshold has been met.
Was the Arbitrator’s decision a preliminary order of an interlocutory nature?
Mr Gales’ solicitors submit the Arbitrator’s decision is of an interlocutory nature in respect of which no appeal under section 352(1) of the 1998 Act lies pursuant to clause 200B of the Workers Compensation Regulation 2003 (‘the 2003 Regulations’). They contend that the ‘decision’ only deals with whether Mr Gales can pursue his claim pursuant to section 66 of the 1987 Act despite him commuting various workers compensation entitlements before the Compensation Court on 30 March 2000.
The right of appeal provided to the parties to a dispute by section 352(1) of the 1998 Act is in respect of a ‘decision’ of an Arbitrator. Section 352(8) states:
“(8). In this section, decision includes an award, interim award, order, determination, ruling and decision, but does not include any award, order, determination, ruling or direction of an interlocutory nature prescribed by the regulations.”
Clause 200B of the 2003 Regulations states:
“200B. For the purposes of section 352(8) of the 1998 Act, all preliminary or interim orders, determinations, rulings and directions of an interlocutory nature are prescribed.”
Section 352(8) took effect as an amendment to the 1998 Act on 1 November 2006, pursuant to the Workers Compensation Legislation Amendment (Miscellaneous Provisions) Act 2005. Schedule 6, Part 18J, clause 5 of the 1987 Act provides that the amendment has retrospective effect:
“5. The amendments made to section 352 of the 1998 Act by the amending Act apply in respect of a claim for workers compensation made before the commencement of the amendments.”
The word ‘claim’ is defined in section 4 of the 1998 Act as meaning “a claim for compensation or work injury damages that a person has made or is entitled to make”. In my opinion, in view of the clear and unambiguous language used in clause 5, there is no doubt that section 352(8) applies to claims such as Mr Gales’ (made on 12 July 2006) which were made before 1 November 2006: see, for example, P & O Ports Ltd v Hawkins [2007] NSWWCCPD 87 (‘Hawkins’); Morris v Bourke Shire Council [2007] NSWWCCPD 162 (‘Morris’).
I must therefore determine whether the Arbitrator’s decision issued on 15 May 2007 is a decision of an interlocutory nature. The meaning of the word ‘interlocutory’ in this context has been discussed by Deputy President Roche in a number of recent cases: Nott v The Western Stores Ltd and ors [2007] NSWWCCPD 83; Hawkins; Arquero v DJ & T Denning Pty Ltd t/as Capital Coast Steel [2007] NSWWCCPD 126; Waverley Council v Sheen [2007] NSWWCCPD 127; Morris; and Hart. For example, in Hawkins, at paragraph 36-37, the Deputy President said:
“35. The distinction between a ‘final’ and ‘interlocutory’ order has been said to be ‘not an entirely satisfactory one’ (Southern Cross Exploration NL an others v Fire and All Risks Insurance Company Ltd and others[No 2] (1990) 21 NSWLR 200 per Kirby P (as he then was) at 206 (‘Southern Cross’)). Justice Kirby then noted the words of Lord Denning MR in Salter Rex & Co v Ghosh [1971] 2 QB 597 at 601 that the distinction between final and interlocutory orders was so uncertain that ‘the only thing for practitioners to do is to look up the practice books and see what has been decided on the point’. His Honour added at 207:
‘Thus, no golden thread of logic runs through the cases. There are common features in the rulings. But it is futile to look for an entirely coherent system, notwithstanding the importance of the classification for the appellate rights of the party seeking to contest an order which falls on one side of the line, or another.
The principal point to be noted in at least the recent decisions of the High Court of Australia on this question, is that the focus of attention is upon the legal effect of the order under examination, not its practical consequences.’
36. His Honour quoted from Gibbs J (as he then was) in Licul v Corney (1976) 50 ALJR 439 at 443-444 where his Honour said that the established view in Australia was that what is interlocutory:
‘... depends on the nature of the order made; the test is: does the judgment or order, as made, finally dispose of the rights of the parties?’”
In the current proceedings, the Arbitrator had been asked to determine whether Mr Gales was precluded from pursuing his claims because of the commutation approved by the Compensation Court on 30 March 2000. In his Statement of Reasons, the Arbitrator stated:
“22. As established in Mirkovic v Davids Holdings Pty Ltd (1995) 11 NSWCCR 656 a redemption or commutation does not ‘trade in’ all liability for the general circumstances of injury, in this case skin cancer. The liability extinguished by commutation is that attached to those particular entitlements claimed with their own date of injury, whether weekly payments, medical expenses or lump sums. The entitlement to claim lump sums could not be relinquished by Mr Gales because no entitlement existed at the time of commutation.
23. Mr Gales is therefore able to pursue his claim for lump sum under s 66 of the Act because the Respondent’s liability for this injury was not extinguished by the commutation approved by the Compensation Court on 30 March 2000. He should now be referred to an Approved Medical Specialist for assessment.”
I note that QBE does not dispute that Mr Gales incurred medical and hospital expenses and that his skin cancers have resulted in a whole person impairment. Thus, by virtue of section 326(1) of the 1998 Act, which provides that the degree of permanent impairment of the worker stated by the Approved Medical Specialist (‘AMS’) in the Medical Assessment Certificate (‘MAC’) is conclusively presumed to be correct, the AMS’s assessment would effectively determine the amount of compensation for permanent impairment payable by QBE pursuant to section 66 of the 1987 Act. In terms of the statutory scheme encompassed in the workers compensation legislation, if leave were not to be granted in this instance, the parties could incur unnecessary additional costs in connection with the AMS’s assessment and the issue of the MAC if the question of liability were not to be determined conclusively until after this stage in the proceedings.
In my opinion, the Arbitrator’s decision was clearly one that was determinative of the substantive rights of the parties. Had the Arbitrator decided that Mr Gales had commuted his right to pursue any further claim in respect of skin cancer by reason of the agreement of 30 March 2000, Mr Gales would have been precluded from pursuing his claim in the current proceedings. Thus, in this instance, the Arbitrator’s decision was not one of an interlocutory nature precluding a party from appealing against the decision.
Leave to appeal is granted.
SUBMISSIONS
QBE
QBE submits that it has no further liability pursuant to the order of Judge Geraghty of the Compensation Court on 30 March 2000. In the ‘Consent to Application for Commutation and Redemption’ signed by Mr Gales on 30 March 2000, he stated:
“In giving this consent I appreciate that the payment of the lump sum referred to in the Short Minutes of Order will bring to an end as from 30 June 1984 my right to all entitlements under the Workers Compensation Act which I have or will have in the future in respect of the injury(ies) referred to in the Short Minutes of Order including:
(1) weekly payments of compensation of all kinds including those payable in the event of a failure of the employer to provide suitable employment; and
(2) medical, hospital, rehabilitation and all such like expenses payable under the Act; and
(3) any lump sum payable under the Act for the loss of a part or of a function of my body.”
Moreover, the ‘Application for Determination’ filed by Mr Gales in the Court was specifically amended to include among the injuries sustained by Mr Gales in the course of his employment with LMB “skin cancer, severe facial disfigurement and severe bodily disfigurement” (Annexure ‘A’, paragraph (g) of the Short Minutes of Order dated 30 March 2000).
QBE submits that the payment of the sum in commutation of Mr Gales’ entitlements triggered section 51 of the 1987 Act, then in effect. This permitted the Court, with the consent of the worker, to commute liability in respect of weekly compensation by a lump sum determined by the Court. The effect of such a commutation, stated in section 51(3) (quoted above, in paragraph 8), was to extinguish any further liability to which the agreement of the worker related.
QBE submits that the reference in the decision in Kruger, referred to by the Arbitrator, to the decision of Neilson J in Mirkovic, does not support the proposition that section 51(3) applies in respect of the commutation of the entitlement to compensation but not liability resulting from the injury. QBE contends that section 51 is unambiguous and “removes any liability to which the agreement of the worker relates” once the commutation has been approved and the consequent lump sum has been paid. QBE contends that at the time of the commutation, Mr Gales had already undergone treatment for skin cancers and liability in respect of facial and bodily disfigurement was squarely in the minds of Mr Gales and his legal representatives, as is clear from the Annexure to the Short Minutes amending the Application for Determination to include additional injuries including “skin cancer, severe facial disfigurement and severe bodily disfigurement”.
QBE submits that sections 15 and 16 were not included in the Act to create new benefits, but rather to create certainty as to the employer responsible for compensating a worker where the injury consists of a disease contracted by gradual process, or of the aggravation of a disease. Neither Alto nor Stone advance the Applicant’s proposition that the liability extinguished by Judge Geraghty and the subsequent payment did not include the liability now deemed to exist.
Mr Gales
Mr Gales’ solicitors state there is no evidence that his skin cancer condition was incapacitating at the time of Mr Gales’ resignation on 12 July 1996. Thus, pursuant to section 15(1), the deemed date of injury in respect of his claim for section 60 medical expenses is the date he claimed those expenses, that is 17 May 1999. Similarly, the deemed date of injury in relation to permanent impairment is, once again, his date of claim, in this instance 12 July 2006. Thus, in accordance with the decision in Alto, Mr Gales has two deemed dates of injury for his skin cancer condition – 17 May 1999 and 12 July 2006.
With regard to paragraph (g) of Annexure A of the Short Orders of Minute dated 30 March 2000, Mr Gales’ solicitors note that the injuries listed in that paragraph, including “skin cancer, severe facial disfigurement and severe bodily disfigurement”, means such injuries as are (paragraph (g)):
“received by the worker during the course of his/her employment with the respondent employer including injuries arising out of the nature and conditions of that employment, during the period in which the said applicant worker was employed by the said respondent employer.”
Mr Gales did not suffer any skin cancer injury during the period of his employment with LMB. He first suffered such an injury on 17 May 1999, having last worked for LMB on 12 July 1996. Moreover, the commutation of 30 March 2000 cannot cover Mr Gales’ current claim pursuant to section 66 as the deemed date of injury for that claim was 12 July 2006. A commutation has the effect of determining all compensation entitlements in relation to all injuries that are the subject of it, which must necessarily have occurred prior to approval of the commutation.
Mr Gales’ solicitors submit the wording of section 15(1) is clear, stating in paragraph (a) “the injury shall, for the purposes of the Act, be deemed to have happened” (emphasis added). Sections 15 and 16 provide a mechanism for claims to be made. There is no limitation on their deeming effects. See for example, Gow v Patrick Stevedores [2002] NSWCC 60 (‘Gow’), where Geraghty J noted the capriciousness of section 16(1)(a) in deeming a date of injury 10 years after the worker had retired. Nevertheless, His Honour said he was bound to follow the clear, unambiguous meaning of that provision.
Mr Gales’ solicitors also submit that as Neilson J made clear in Mirkovic, the decision followed by the arbitrator in Kruger, what is being redeemed is liability in respect of an entitlement to compensation and not liability in respect of the injury itself. Mr Gales’ solicitors conclude that as at 30 March 2000, Mr Gales had not claimed a section 66 entitlement in respect of skin cancer because he had not yet suffered any injury allowing him to claim such an entitlement.
DISCUSSION AND FINDINGS
The role of the Presidential Member on appeal is to review the Arbitrator’s decision as a whole. The review is not a rehearing. In this case, QBE must demonstrate that the decision of the Arbitrator is affected by some legal, factual or discretionary error (Allesch v Maunz (2000) 203 CLR 172; The King Island Company Limited v Deery [2005] NSWWCCPD 1) in order to enliven the Presidential Member’s power to interfere with the Arbitrator’s decision pursuant to section 352(7) of the 1998 Act.
The issue for me to determine is whether the Arbitrator made an error of law in construing the commutation agreement approved by the Compensation Court on 30 March 2000, with consequent payment, as not extinguishing the liability of LMB in respect of Mr Gales’ claim for compensation for permanent impairment in respect of skin cancer. In particular, did the Arbitrator make an error of law in failing to properly apply section 51 of the 1987 Act in effect at the time of the commutation?
In these proceedings, subsections 15(1) and (4) of the 1987 Act, as follows, are relevant:
“(1) If an injury is a disease which is of such a nature as to be contracted by a gradual process:
(a) the injury shall, for the purposes of this Act, be deemed to have happened:
(i) at the time of the worker’s death or incapacity, or
(ii) if death or incapacity has not resulted from the injury-at the time the worker makes a claim for compensation with respect to the injury, and
(b) compensation is payable by the employer who last employed the worker in employment to the nature of which the disease was due.
(4) In this section, a reference to an injury includes a reference to a permanent impairment for which compensation is payable under Division 4 of Part 3.”
There is no dispute that on 17 May 1999 Mr Gales made a claim for section 60 medical expenses in respect of the ‘injury’ skin cancer, which the parties accept is a disease of gradual process. Mr Gales claimed and there seems to be dispute that he contracted the disease through exposure to sunlight in the course of his employment with LMB as a deckhand/tugdriver between 1981 and July 1996. However, since skin cancer was not the cause of his incapacity when he stopped work on 12 July 1996, the application of section 15(1)(a)(ii) determines that the deemed date of injury in respect of this claim is the date the claim was made, that is 17 May 1999.
On 30 March 2000, Mr Gales entered into a commutation agreement that was approved by the Compensation Court (Geraghty J). At issue, is the effect of the commutation agreement on any further liability of the employer. Section 51(3) of the 1987 Act in effect at that time, quoted in paragraph 8 above, provided that where a worker agrees that a lump sum payment should remove any liability to make a payment under Divisions 3 (medical, hospital and related expenses) or 4 (compensation for non-economic loss, including permanent impairment), “payment of the lump sum removes any liability to which the agreement of the worker relates”.
As a result of the amendment contained in the Annexure to the Short Minutes of Order, the commutation agreement included additional injuries not listed in the original ‘Application for Determination’, in particular, “skin cancer, severe facial disfigurement and severe bodily disfigurement”.
Mr Gales did not make a claim for permanent impairment pursuant to section 66 of the 1987 Act in respect of skin cancer until 12 July 2006. While this was 10 years after Mr Gales resigned from his employment with LMB, nevertheless, the deemed date of injury pursuant to section 15(1)(a)(ii) is the date of claim, thus 12 July 2006. It is clear from the decision of the NSW Court of Appeal in Alto that there may be different deemed dates of injury according to the entitlement claimed: see the judgment of Sheller JA (with whom Meagher JA and Cole AJA agreed) in Alto at paragraph 25, a judgment cited by the NSW Court of Appeal in Stone as authority for the proposition that, in the same way, section 16 “may fix different dates for incapacity and impairment injuries” (per Handley JA at paragraph 8, and see Hodgson JA, with whom Mason P and Handley JA agreed, at paragraphs 36 – 38); see also the discussion in Visy Board Pty Ltd v Ali [2007] NSWWCCPD 22, at paragraphs 26 – 38.
QBE contends that at the time of the commutation, liability for skin cancer was squarely in the mind of Mr Gales and his legal representatives, and that section 51 is clear and unambiguous in removing such liability as the worker agrees. Mr Gales’ solicitors contend that the injuries listed in the Annexure means injuries that the worker received during the course of or arising out of his employment and during the period of such employment. A commutation necessarily only applies to those injuries which have occurred prior to the commutation. Mr Gales did not suffer any skin cancer injury during his employment with LMB. He first suffered such an injury on 17 May 1999 when he made a claim in respect of medical expenses. Mr Gales’ solicitors submit that while the injury for the purposes of his claim for medical expenses is “deemed to have happened” (section 15(1)(a)) on 17 May 1999 and thus before the commutation, the injury for the purposes of his claim for permanent impairment is deemed to have happened on 12 July 2006. In the latter case, because the injury occurred after the commutation, the injury cannot be encompassed by the commutation. Such, Mr Gales’ solicitors contend, is clear from the wording of the Act, as was acknowledged by Geraghty J in Gow.
Moreover, Mr Gales’ solicitors submit that what is being redeemed is liability in respect of an entitlement to compensation and not liability in respect of the injury itself. Mr Gales did not claim a section 66 entitlement until 12 July 2006, after the commutation.
In my opinion, neither sections 15 nor 16 create a liability to pay compensation. Rather, liability is a consequence of an ‘injury’ (section 4) arising out of or in the course of the worker’s employment: Crisp v Chapman (1994) 10 NSWCCR 493, at 495 (Mahoney A-P). If, as in Mr Gales’ case, the injury is a disease of gradual process contracted over a number of years, during which time the worker will not uncommonly have worked for a number of employers, section 15 applies to determine the deemed date of injury in order to establish upon which employer liability to pay compensation falls: JM & DL McGregor Constructions Pty Ltd v Hughes [2006] NSWWCCPD 197, at paragraph 44 (Acting Deputy President Roche).
While the skin cancer injury in respect of which Mr Gales made a claim for permanent impairment under section 66 of the 1987 Act is, “for the purposes of the Act, deemed to have happened” (section 15(1)(a)), on 12 July 2006, when Mr Gales made a claim, nevertheless, the injury occurred during the course of his employment between March 1981 and July 1996 and was obviously known to the parties and in their minds at the time of the commutation agreement on 30 March 2000, in which reference to that condition was made.
By the commutation agreement, Mr Gales agreed to “bring to an end”:
“my right to all entitlements under the Workers Compensation Act which I have or will have in the future in respect of the injury(ies) referred to in the Short Minutes of Order including:
(1) ...
(2) ...
(3) any lump sum payable under the Act for the loss of a part or a function of my body.”
Annexure A to the Short Minutes of Order dated 30 March 2000 had the effect of amending the ‘Nature of injury’ stated in paragraph 2 of the ‘Application for Determination’ filed in the Compensation Court to include “skin cancer, severe facial disfigurement and severe bodily disfigurement”.
In my view, section 51(3) of the 1987 Act in effect at the time of the commutation was effective to remove liability for entitlements in respect of the listed injuries, including skin cancer, which had occurred prior to the date of commutation. Thus, LMB were not liable in respect of Mr Gales’ later claim for compensation for permanent impairment in respect of skin cancer under section 66. QBE having established the Arbitrator made an error of law justifying interference with his decision, that decision must be set aside and a new decision substituted.
In concluding, I note that the fact that there may be different deemed dates of injury in respect of entitlements under the 1987 Act is not in this case relevant to the determination of the issue of the effect of the commutation agreement. With regard to the decision in Mirkovic, relied on by the Arbitrator, and to which reference is made by Mr Gales’ solicitors, Neilson J found that the redemption was effective to redeem the employer’s liability in respect of injuries occurring after 30 June 1985. However, despite evidentiary problems and credit issues in that case, the redemption did not affect the worker’s right to bring a claim for incapacity arising from an injury before that date, specifically an injury sustained on 15 January 1980, liability for which had not been redeemed. In my view, that decision does not assist Mr Gales’ case, the facts of which are materially different.
DECISION
The decision of the Arbitrator issued on 15 May 2007 is revoked and the following decision is substituted:
“ 1. Award for the Respondent in respect of the Applicant’s claims for skin cancer.
2. No order as to costs.”
COSTS
There is no order as to the costs of this appeal.
Robin Handley
Acting Deputy President
19 September 2007
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF ROBIN HANDLEY, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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