MacKellar v Asciano Limited and Subsidiary Companies
[2016] WADC 56
•15 APRIL 2016
MACKELLAR -v- ASCIANO LIMITED AND SUBSIDIARY COMPANIES [2016] WADC 56
| DISTRICT COURT OF WESTERN AUSTRALIA | Citation No: | [2016] WADC 56 | |
| Case No: | APP:73/2015 | 18 JANUARY 2016; SUPPLEMENTARY SUBMISSIONS 16 FEBRUARY 2016 | |
| Coram: | SCOTT DCJ | 15/04/16 | |
| PERTH | |||
| 24 | Judgment Part: | 1 of 1 | |
| Result: | Leave to appeal granted Appeal allowed Application A19715 dismissed | ||
| PDF Version |
| Parties: | HELENE JOAN MACKELLAR ASCIANO LIMITED AND SUBSIDIARY COMPANIES |
Catchwords: | Workers' Compensation and Injury Management Act 1981- Whether the appellant's application before the arbitrator constituted a 'dispute' pursuant to s 176(1)(a) Whether the arbitrator had jurisdiction Whether the appellant as personal representative of the worker had a maintainable claim |
Legislation: | Workers' Compensation and Injury Management Act 1981 s 31C, s 31H, s 31I, s 76(1), s 76(2)(a), s 76(6), s 92(f), s 176(1)(a), s 176(3), s 301 |
Case References: | Australasian Correctional Management v Nydegger (2011) WACC C10-2011 Director of Public Prosecutions v White [2010] WASCA 47 Kennedy v Broden Construction Pty Ltd [2008] WACC C28-2008 Masters v Cameron [1954] HCA 72 Moyle v Minister for Works (1979) WAR 183 Re Nanaimo Community Hotel Ltd [1944] 4 DLR 638 Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 16 Zhi (John) Wang v J M Dickman Engineering [2007] WACC C36-2007 |
JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
- IN CIVIL
- Appellant
AND
ASCIANO LIMITED AND SUBSIDIARY COMPANIES
Respondent
ON APPEAL FROM:
Jurisdiction : WORKERS' COMPENSATION ARBITRATION SERVICE (WA)
Coram : ARBITRATOR FLETCHER
File No : A 19715 of 2015
Catchwords:
Workers' Compensation and Injury Management Act 1981- Whether the appellant's application before the arbitrator constituted a 'dispute' pursuant to s 176(1)(a) - Whether the arbitrator had jurisdiction - Whether the appellant as personal representative of the worker had a maintainable claim
Legislation:
Workers' Compensation and Injury Management Act 1981 s 31C, s 31H, s 31I, s 76(1), s 76(2)(a), s 76(6), s 92(f), s 176(1)(a), s 176(3), s 301
Result:
Leave to appeal granted
Appeal allowed
Application A19715 dismissed
Representation:
Counsel:
Appellant : Mr G T Stubbs
Respondent : Mr A Basile
Solicitors:
Appellant : W G McNally Jones Staff
Respondent : SRB Legal
Case(s) referred to in judgment(s):
Australasian Correctional Management v Nydegger (2011) WACC C10-2011
Director of Public Prosecutions v White [2010] WASCA 47
Masters v Cameron [1954] HCA 72
Moyle v Minister for Works (1979) WAR 183
Re Nanaimo Community Hotel Ltd [1944] 4 DLR 638
Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 16
Zhi (John) Wang v J M Dickman Engineering [2007] WACC C36-2007
- SCOTT DCJ:
Appeal
1 This is an appeal pursuant to Pt XII of the Workers' Compensation and Injury Management Act 1981 (Act) against the decision of the arbitrator in Application A19715 (Application) dismissing the appellant's claim against the respondent for the sum of $79,025.60 (sum) on the grounds that there was no dispute over which he had jurisdiction.
Background
2 The appellant is the widow of the late James Mackellar (Mr Mackellar) who was employed by the respondent.
3 On 7 August 2010 Mr Mackellar sustained a work related injury to his left leg and on 12 August 2010 he lodged a claim for workers' compensation with the respondent.
4 The respondent's insurer, Allianz Australia Insurance Limited (Allianz) accepted liability in a Form 3A notice dated 13 August 2010.
5 Mr Mackellar was examined by Professor Sikorski on 7 March 2012 for the purposes of sch 2 pt 2 of the Act. In Forms AMS 5 and AMS 6 dated 29 March 2012 Professor Sikorski assessed Mr Mackellar's level of permanent impairment of his left leg at or above the knee under item 67 of sch 2 at 60%.
6 By letter dated 20 August 2013 from Allianz to Mr Mackellar (letter from Allianz), Allianz offered to settle Mr Mackellar's workers' compensation claim for the sum. The letter was in the following terms:
Dear Mr Mackellar
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Allianz Australia writes further to our recent discussion regarding the settlement of your workers' compensation claim.
Please find enclosed the report of Dr Sikorski, dated 12th March 2012 who has assessed you with a permanent impairment assessment of 60%. Accordingly, our offer of settlement is as follows:
Item No. 67 for permanent impairment of left leg
at or above the knee $77,025.60
Future Medical Treatment $2,000.00
TOTAL $79,025.60
The total amount of $79,025.60 is offered as a lump sum payment to redeem and settle your workers' compensation claim. In accepting this settlement the following will apply:
1. You will have no further entitlement to weekly payments under the Workers' Compensation and Injury Management Act, 1981.
2. You will not have any other claim to redemption of weekly payments.
3. You will have no further entitlement to statutory allowances – medical or surgical, dental, physiotherapy or chiropractic advice or treatment, first aid and ambulance expenses, medical requisites, charges for attendance and treatment by way of rehabilitation, charges for hospital treatment and maintenance, cost of artificial aids and travelling expenses.
4. You will forfeit any entitlement you may have to pursue common law damages under section 93E of the Act. That is, in general terms, you forfeit any entitlements you may have to sue your employer for civil damages.
5. There will be no indemnity for Centrelink, Medicare Australia or any other government agency.
We must advise that settlement amounts greater than $5,000, by law, are subject to a 10% deduction at the time of the payment in favour of Medicare Australia. Medicare then liaise with you directly, checking for any medical treatment paid in association with your work place injury, deducting that amount from the payment and the balance, if any, will then be forwarded on to you.
We enclose the following Election for Schedule 2 Injuries, Memorandum of Agreement, Statement of Consequences of Recording a Memorandum of Agreement and Notice of Settlement for you to review, sign and return to this office as soon as possible.
Upon receipt of the signed documents, Allianz will forward them to WorkCover WA for execution. Please note, your entitlement to statutory allowances will cease on the date you sign the agreement.
We take the opportunity to advise that you are able to seek independent legal advice or contact the Customer Assistance Unit at WorkCover WA on (08) 9388 5555 for further information.
Should you have any queries regarding this matter please contact your case manager April Howell on (08) 94 228 457.
Yours sincerely
April Howell
Senior Case Manager
WA Workers Compensation
Allianz Australia Insurance Limited
7 By letter dated 18 September 2013 (letter from Mr Mackellar's solicitors) the solicitors for Mr Mackellar responded to Allianz in the following terms:
Dear April
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We advise that we are instructed to act for Mr Mackellar in relation to the above workers' compensation claim and enclose an authority signed by our client.
We refer to your letter dated 20 August 2013 with an offer of settlement of:
• Item 67: 60% impairment of leg at or above the knee $77,025.00
• Future medical treatment $ 2,000.00
• Total $79,025.60
We are instructed that Mr Mackellar wishes to accept the offer contained in your letter and we would be grateful if you would please prepare and forward settlement documents to us for signature by our client.
We thank you for your prompt assistance in this matter.
Yours faithfully
Helen Parker
Lawyer
W G McNally Jones Staff
8 Mr Mackellar died on 22 September 2013. His death was not as a consequence of his workplace injury.
9 At the time of his death Mr Mackellar was not in receipt of, or entitled to receive, weekly payments as a consequence of his workplace injury for not less than six months (see sch 1 cl 5) and had not signed any of the settlement documents referred to in the letter from Allianz. Those documents were not attached to the letter from Allianz and had not otherwise been sent to Mr Mackellar's solicitors.
10 In the Application the appellant sought, as the legal personal representative of Mr Mackellar's estate, the sum pursuant to an agreement which she asserted was made between Mr Mackellar and the respondent by the exchange of the two letters.
11 The respondent disputed the appellant's claim because Mr Mackellar had died before making an election for the purposes of s 31C and s 31H of the Act and contended that the requirements for registering a Memorandum of Agreement pursuant to s 76 of the Act were not met.
12 On 11 March 2015 the arbitrator made orders by consent that the Application be determined on the papers and that the parties file and serve a statement of agreed facts, outlines of submissions, lists of authorities and books of documents.
13 On 22 June 2015 the arbitrator made orders requiring the parties to file and serve supplementary submissions with respect to the question as to whether he had jurisdiction to deal with the appellant's claim.
14 Because the arbitrator dealt with the Application on the papers it is appropriate to summarise the materials before him.
15 Those materials comprised:
(a) statement of agreed facts dated 1 April 2015 (SAF);
(b) respondent's Book of Documents, Outline of Submissions and List of Authorities filed 14 April 2015;
(c) applicant's book of documents, outline of submissions and list of authorities filed 15 April 2015;
(d) applicant's reply to the respondent's outline of submissions dated 21 April 2015;
(e) respondent's outline of submissions in reply filed 29 April 2015;
(f) applicant's supplementary submissions on jurisdiction dated 20 July 2015; and
(g) respondent's supplementary submissions on jurisdiction dated 23 July 2015.
16 The SAF was in the following terms:
1. The Deceased Worker, James Mackellar ('the Deceased'), injured his left leg at work on 7 August 2010 ('the injury').
2. The Deceased lodged a claim for workers' compensation with the Respondent, his employer, in relation to the injury on 12 August 2010.
3. The Respondent's insurer, Allianz, accepted liability by way of a Form 3A Notice dated 13 August 2010.
4. The Deceased was assessed for the purposes of Schedule 2, Part 2 of the Workers' Compensation and Injury Management Act 1981 (the Act) at the request of the insurer by Professor Jerzy (George) Sikorski on 7 March 2012.
5. In his Forms AMS 5 and AMS 6 dated 29 March 2012, Professor Sikorski assessed the Deceased's level of permanent impairment of the left leg at or above the knee under Item 67 at 60%.
6. The insurer made an offer of settlement to the Deceased in a letter dated 20 August 2013 addressed to the Deceased ('the Offer').
7. The Deceased's solicitors, W.G. McNally Jones Staff Lawyers, accepted the Offer on the Deceased's behalf via facsimile letter addressed to the Insurer on 18 September 2013.
8. The Deceased died on 22 September 2013. The death was not as a consequence of the Injury.
9. At the time of his Death, the Deceased was not in receipt of weekly payments and had not received weekly payments as a consequence of his injury for not less than 6 months and had not signed the settlement documents.
10. At the time of his Death the settlement documents had not been sent to the Deceased's solicitors by the insurer.
Summary of submissions before the arbitrator
Appellant's submissions 15 April 2015
(a) The letter from Allianz and the letter from Mr Mackellar's solicitors constituted an unconditional settlement agreement for the sum subject to the Director's examination of the agreement and the election as required by the regime set out under s 76 et seq of the Act.
(b) Section 76(1) of the Act was procedural in nature and did not affect the substantive rights of the parties.
(c) The form of election and the requirement that the worker sign such a form was procedural and did not affect the efficacy of the agreement or the substantive rights of the parties.
(d) The sum was a composite amount calculated by reference in part to a second schedule amount of $77,025.60 with an additional $2,000 for future medical expenses.
(e) The conditions (numbered 1 – 5) in the letter from Allianz took the offer from Allianz well beyond an offer to resolve a claim solely on the basis of a second schedule amount – those conditions including that Mr Mackellar forego common law entitlements and included an additional $2,000 for future medical expenses.
(f) In accordance with the principles in Masters v Cameron [1954] HCA 72 [9] and [10] there was:
(i) a contract binding the parties at once to perform the agreed terms whether the contemplated formal document came into existence or not and to join in settling and executing the formal document; or
(ii) a contract binding the parties to join in bringing a formal contract into existence and then to carry it into execution.
(g) There is, under the Act, a capacity for workers and employers to reach agreement in relation to compensation. Section 76 does not require an election under (inter alia) s 31C and an election was not required to resolve the settlement between Mr Mackellar and the respondent.
(h) An election was not required to make or register the agreement and even if it was that requirement was procedural only and the agreement could therefore be executed by the administrator of Mr Mackellar's estate and the Director could then register the agreement in accordance with its terms.
(i) Alternatively the agreement could be enforced immediately at common law or in equity.
Respondent's submissions 14 April 2015
(a) The entitlement for a worker to be paid compensation for certain permanent impairments was outlined in s 31C of the Act which provided that if the worker so elects during his lifetime in the manner provided by s 31H the compensation payable for the impairment will be the percentage of the prescribed amount in column 2 of sch 2 to the Act.
(b) Pursuant to s 31H of the Act:
(i) a worker elects for the purpose of s 31C when the worker signs a form of election prescribed by the regulations containing prescribed particulars in respect of the impairment or loss and that form of election is filed with the Director;
(ii) a worker can elect for the purposes of s 31C only if:
(1) the worker and the worker's employer agree as to the worker's degree of permanent impairment resulting from the injury concerned; or
(2) a determination has been made under s 31D(4) in respect of the worker's degree of permanent impairment.
(d) Section 31I provides that a form of election is not binding upon the worker unless the Director is satisfied that it contains certain prescribed information about the legal effect of an election and an agreement is registered or an order of an arbitrator is made with respect to the amount of compensation payable pursuant to the election.
(e) Regulation 4(2) of the Act provides that the form of election in s 31H must be in Form 1A in Appendix 1 to the Act which from its terms must be signed by the worker personally.
(f) Section 301 provides that except as provided by the Act, its provisions apply notwithstanding any contract to the contrary. The appellant asserts a binding settlement agreement outside the Act which by reason of s 301 cannot take effect.
(g) The Act does not expressly give the worker's dependents any entitlement under sch 2 in circumstances where the worker dies from an unrelated cause unless sch 1 cl 5 applies. That claim specifically entitles a worker's dependents to payment only if a worker was receiving or entitled to receive weekly payments of compensation for not less than six months immediately preceding his death from a cause unrelated to a compensable injury.
(h) Whether Mr Mackellar's estate had a claim depended on whether Mr Mackellar had any accrued right to compensation before he died. That right depended upon compliance with the statutory regime under the Act for making claims under sch 2.
(i) By the wording of the letter from Mr Mackellar's solicitors Mr Mackellar was agreeing to the degree of permanent impairment for the purposes of s 31H(2) which then gave him the right to elect which would in turn result in an enforceable agreement if registered/recorded.
(j) Alternatively even if the exchange of letters resulted in an intention to create contractual relations the consideration for Mr Mackellar in any such agreement would be the receipt of the sum whilst the consideration for the respondent would be a discharge from any further liability – which could only be achieved in the event that there was compliance with s 31C, s 31H and approval by the Director under s 31I and s 76.
In those circumstances before the approval by the Director might be sought there needed to be compliance with s 31C(1) and s 31H(1) by an election by the deceased during his lifetime. In the event that the appellant purported to sign an election in her capacity as administrator of Mr Mackellar's estate it could not be an election made during the lifetime of Mr Mackellar.
(k) Consequently:
(i) the appellant was not entitled to elect pursuant to s 31C and s 31H;
(ii) Mr Mackellar did not elect during his lifetime;
(iii) the Director cannot register any settlement agreement; and/or
(iv) section 301 prohibits contracting out of the requirements of the Act.
17 The agreement included a resolution of the common law rights of Mr Mackellar and as a result the provisions of s 92(f) of the Act are applicable.
Respondent's reply 29 April 2015 to applicant's submissions 15 April 2015
(a) The decision in Masters v Cameron was not applicable given that case did not deal with statutory requirements such as those in the Act.
(b) There was no settlement agreement unless and until an election was made and the agreement was registered pursuant to s 76 of the Act.
(c) Section 92 of the Act only operates where an action has been commenced, which in this case it had not.
(d) The combined purpose of s 76 – s 78 is to regulate all forms of settlement and all forms of compensation to which a worker is or might be entitled in respect to the compensable injury under the Act.
(e) The election to accept a second schedule entitlement is not procedural but substantive and unless and until an election had been signed by Mr Mackellar during his lifetime there was no ability to elect to obtain that entitlement. As a consequence no-one claiming for and on his behalf is entitled to any second schedule payment.
(f) There is a procedure in accordance with the Act which was not followed and accordingly the appellant has no entitlement pursuant to the Act.
18 The arbitrator then made an order that the parties file supplementary submissions with respect to the question whether he had jurisdiction to deal with the appellant's claim. A summary of those submissions are as follows:
Applicant's supplementary submissions on jurisdiction 20 July 2015
(a) The appellant as the legal personal representative of Mr Mackellar had standing to execute a Form 15C Memorandum of Agreement, a Form 15D Statement of the Consequences of the Recording of a Memorandum of Agreement and a Form 1A election for sch 2 injuries on Mr Mackellar's behalf.
(b) The arbitrator had jurisdiction to determine disputes under the Act by s 176 of the Act and to make conditional and ancillary orders and directions pursuant to s 212 and to enforce decisions pursuant to s 219.
(c) The issues in dispute identified in the appellant's application involved a determination of whether valid and binding settlement agreement was reached on 18 September 2013 and is a 'dispute' within s 176(1) of the Act: Zhi (John) Wang v J M Dickman Engineering [2007] WACC C36-2007.
Resolution of the dispute requires an interpretation of the Act as to:
(i) whether an election is required to formalise the settlement agreement reached by the parties;
(ii) whether s 31H is substantive or procedural;
(iii) whether the appellant can execute the agreement as legal personal representative of Mr Mackellar.
(d) The arbitrator's powers including the provisions of s 212 and s 219 of the Act are wide enough to encompass the orders sought by the appellant.
Respondent's supplementary submissions on jurisdiction 23 July 2015
(a) The arbitrator can only dismiss the Application because in accordance with the Act the election was not signed during Mr Mackellar's lifetime and a Memorandum of Agreement therefore cannot be registered pursuant to the Act.
(b) The arbitrator does not have power to order specific performance of an agreement unless that agreement can be registered pursuant to the Act. That cannot occur by reason of which no order could be made by the arbitrator enforcing any such agreement.
Arbitrator's decision
19 The arbitrator handed down his decision on 15 September 2015.
20 He said that the matter which fell for his determination was the issue as to whether the letters of 20 August 2013 and 18 September 2013 constituted an agreement which was binding and enforceable.
21 To that end he said that the appellant conceded that the agreement did not meet the requirements for a binding and enforceable agreement under the Act but that it satisfied those requirements under the general law and in effect sought an order for specific performance.
22 The arbitrator considered the provisions of s 176(1) and s 176(3) of the Act and concluded that his jurisdiction did not extend to determining the liability under and the enforceability of the alleged agreement under the general law of contract.
23 He then concluded that it must follow that he was bound to dismiss the application on the basis that it sought relief beyond the limits of his jurisdiction. That is that the issue raised by the appellant as to whether the alleged agreement was binding and enforceable under the general law of contract, was not justiciable by him because it fell outside the statutory limits of his jurisdiction.
24 The arbitrator observed that that was not to say that a court of competent equitable jurisdiction would refuse the relief sought by the appellant but merely that the Act did not vest the requisite jurisdiction in the Workers' Compensation Arbitration Service to grant such relief – that is an order for specific performance to either compel the respondent to make the payment or to execute a form 15C Memorandum of Agreement and provide it to the executor or administrator of Mr Mackellar's estate for it to be executed and sent to the Director to be considered for registration under s 76.
25 The arbitrator then made some observations, without it being necessary for him to do so, relating to various provisions of the Act.
26 The arbitrator dismissed the Application on the grounds that he did not have jurisdiction to determine the issue raised by it.
Appeal provisions
27 The relevant appeal provisions are:
247(1) If written reasons for an arbitrator's decision under Part XI in respect of a dispute are given to a party to the dispute … the party may, with the leave of the District Court, appeal to the District Court against the decision.
247(2) … the District Court is not to grant leave to appeal unless –
(a) In the case of an appeal in which an amount of compensation is at issue –
(ii) a question of law is involved and, in the opinion of the District Court, the matter is of such importance that, in the public interest, an appeal should lie;
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(b) In any other case, a question of law is involved.
247(7) On an appeal made under this section, the District Court may –
(a) Affirm, vary, or quash the decision appealed against, or substitute and make in addition, any decision that should have been made in the first instance …
28 The grounds of appeal are particularised as follows:
1. The arbitrator erred in law and finding that he did not have jurisdiction to determine whether there was a valid and enforceable agreement to redeem a workers' compensation claim.
2. The arbitrator erred in law in finding that he did not have jurisdiction to determine the dispute within the meaning of s 176(3) of the Act.
Notice of respondent's intention
29 In its Notice of Intention, the respondent contended:
1. The arbitrator's decision should be upheld on the grounds relied by him in his decision.
2. The arbitrator's decision should be upheld on grounds not relied by him, namely that there could never be a valid and enforceable agreement between the parties as the requirements of s 31C and s 31H of the Act were not satisfied as a consequence of which any agreement between the parties would contravene s 301 of the Act.
Leave to appeal pursuant to s 247 of the Act.
30 Both parties agree that this court is empowered to grant leave to appeal by reason of the provisions of s 247(2)(a) and/or (b).
31 To that end, at par 23 of his decision, the arbitrator concluded:
On that basis the respondents submit, correctly in my view, that I must dismiss this application on the ground that my jurisdiction under s 173(3) [sic] of the Act, read with the definition of 'dispute' in s 176(1)(a) … is limited to determining disputes 'under this Act' and does not extend to determining whether the Agreement in this matter is binding and enforceable under the general law.
32 In my view the parties are correct in their agreement that the provisions of s 247(2)(a) and/or (b) enliven this court's powers to grant leave to appeal. The appellant is granted leave to appeal the decision of the arbitrator.
33 In this case the parties are in disagreement as to whether, in the event that I was satisfied that the matter before the arbitrator was a 'dispute' pursuant to s 176(1) of the Act I ought to make any decision that should have been made by the arbitrator in the first instance rather than remit the matter to him for determination.
34 To that end I invited the solicitors for the parties to file supplementary submissions. The thrust of the appellant's submissions was that:
(a) the arbitrator is the appropriate person to make a substantive decision;
(b) if the District Court makes the substantive decision, it effectively removes one level of appeal;
(c) the arbitrator has already considered the submissions before him on the substantive issues and is therefore arguably in a better position to decide those issues without a duplication of judicial effort;
(d) there are further issues (although not defined) in relation to the matter that the appellant may wish to draw to the attention of the arbitrator once the matter is remitted.
35 The respondent submits that this court is in as good a position as the arbitrator to determine the substance of the Application on its merits given that the Application was determined by him on the papers by agreement between the parties.
36 In my view it is appropriate that this court deal with the matter including making any decision that should have been made in the first instance.
37 For the purposes of this appeal it has been necessary for me to read all the papers provided to the arbitrator and consider the law in determining this appeal.
38 Although the appellant's counsel refers in the submissions to other matters which the appellant may wish to draw to the attention of the arbitrator if the matter was remitted, there is no detail identifying what those issues might be.
39 In view of the fact that this matter was dealt with by the arbitrator on the papers and counsel for the parties in their submissions in this appeal adopted in the main the arguments raised by them in the arbitration, I am of the view that it is more expedient for this court to deal with the merits of the Application in this appeal in the event I determined that the Application involved a 'dispute' under s 176(1)(a).
Issues on this appeal
40 The issues which fall to be determined in this appeal are:
1. Whether the matter before the arbitrator was a 'dispute' pursuant to the provisions of s 176(1)(a) of the Act. That is in this case whether the arbitrator had jurisdiction to determine whether any agreement was constituted by the two letters and if so whether it was binding and enforceable.
2. Whether the appellant has standing as the legal personal representative of Mr Mackellar to execute:
(a) a Form 1A election for sch 2 injuries;
(b) a Form 15C Memorandum of Agreement;
(c) a Form 15D Statement of the Consequences of the Recording of a Memorandum of Agreement.
3. Whether, pursuant to s 301 of the Act, any agreement was enforceable.
Whether there is a 'dispute' for which the arbitrator had jurisdiction
41 Part V1 of the Act contains the provisions pertaining to dispute resolution.
42 Section 176 relevantly provides:
(1) In this Part —
dispute means —
(a) a dispute in connection with a claim for compensation, or the liability to pay compensation, under this Act;
…..
(2) A proceeding for the determination of a dispute is not capable of being brought other than under this Part.
(3) Subject to this Act, arbitrators have exclusive jurisdiction to examine, hear and determine all disputes.
43 The words 'in connection with' are of a wide input and, subject to the context in which they are used, are capable of describing a spectrum of relationships ranging from direct and immediate to tenuous and remote: Director of Public Prosecutions v White [2010] WASCA 47 [32] (McLure P). In that case her Honour cited with approval MacFarlane J in Re Nanaimo Community Hotel Ltd [1944] 4 DLR 638 who said:
One of the generally accepted means of 'connection' is 'relation between things one of which is bound up with or involved in another'; or again 'having to do with'. The words include matters occurring prior to as well as subsequent to or consequent upon so long as they are related to the principle thing. The phrase 'having to do with' perhaps gives as good a suggestion of the meaning as could be had (639).
44 The appellant claimed the sum as the legal personal representative of her late husband on the grounds that before his death there was a binding agreement relating to his claim for compensation.
45 The respondent denied that it was liable to pay the compensation claimed as a consequence of which the parties were in dispute.
46 In my view that fell squarely within the definition of a 'dispute' in s 176(1)(a) because it was in connection with, that is had to do with:
(i) a claim for compensation; and/or
(ii) the liability to pay compensation under the Act.
47 The appellant's claim purported to be a claim for compensation under the Act. That is clear by the content of the two letters allegedly constituting the agreement upon which the appellant relied. Those letters contemplated the completion and execution of documents which were prescribed in the Act. In addition, the dispute related to a claim for compensation of the worker through whom the appellant laid claim, and the employer's liability to pay an amount by way of compensation under the Act.
48 In my view the arbitrator was in error in determining that the issue between the parties was not a dispute within the meaning of that term in the act. That error was an error of law.
Whether the appellant had a maintainable claim against the respondent
49 The relevant provisions of the Act are as follows:
18. Employers liable to compensate workers for injuries
If an injury of a worker occurs, the employer shall, subject to this Act, be liable to pay compensation in accordance with Schedule 1.
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31C Compensation for impairments mentioned in Schedule 2
(1) Despite Schedule 1, in respect of a permanent impairment from a compensable personal injury by accident, if the worker so elects during the lifetime of the worker as provided by section 31H in respect of an impairment mentioned in column 1 of Part 2 of the table in Schedule 2, the compensation payable for the impairment is, subject to subsection (2) and the provisions of this Act relating to Schedule 2, to be the percentage ratio of the prescribed amount indicated in column 2 of that Part.
…
31H. Election under section 31C or 31E
31H(1) A worker elects under this section for the purposes of section 31C or 31E when —
(a) the worker signs a form of election prescribed by the regulations containing particulars prescribed by the regulations in respect of the impairment or loss; and
(b) that form of election is filed with the Director, and a copy of it is served by or on behalf of the worker on the employer.
31H(2) A worker can elect for the purposes of section 31C only if —
(a) the worker and the worker's employer agree as to the worker's degree of permanent impairment resulting from the injury concerned; or
(b) a determination has been made under section 31D(4) in respect of the worker’s degree of permanent impairment resulting from the injury concerned or the worker has a certificate given for the purposes of section 31F(3) that the worker has contracted AIDS.
…
Regulation 4(2)
The form of election referred to in s 31H must be in the form of Form 1A in appendix 1…
…
Section 76
(1) Subject to section 92(h), where the amount of compensation under this Act has been ascertained, or any weekly payment varied, or any other matter decided under this Act by agreement, or any agreement, whether purporting to be made under this Act or not, has been entered into whereby a worker agrees to compound any claim or right to compensation under this Act, a memorandum thereof shall be sent, in manner prescribed, by any party interested, to the Director, who, subject to subsection (2a), shall, on being satisfied as to its genuineness, and, where the agreement provides for the payment of compensation pursuant to an election under section 24, 24A, 31C or 31E, as to the adequacy of the amount thereof, record such memorandum in a special register without fee, and thereupon the memorandum shall for all purposes be enforceable as an award or order made by an arbitrator.
(2a) The Director cannot, under this section, record a memorandum of an agreement for the payment of a lump sum in redemption of the liability to pay compensation unless the Director is satisfied that the worker is aware of the consequences of the recording of the memorandum.
(3) No agreement between a worker and an employer has any force or validity if it exempts the employer wholly or partially from any liability for compensation to which the worker is or may subsequently become entitled under this Act, and notwithstanding any such agreement, a worker may recover from his employer any compensation to which he is, or subsequently becomes, so entitled, but the foregoing provisions of this subsection have no application to an agreement for the redemption of the liability to pay compensation if a memorandum of the agreement has been duly recorded under this section.
…
(6) A memorandum received for registration shall be examined as to —
(a) the genuineness of the agreement; and
(b) the adequacy of the amount of any compensation pursuant to an election under section 24, 24A, 31C or 31E payable under the agreement,
and if it appears to the Director as the result of such examination or as the result of any information which the Director considers sufficient that a redemption agreement or an agreement as to the amount of compensation payable to the worker … ought not to be registered … by reason that the amount of compensation pursuant to an election under section 24, 24A, 31C or 31E payable under the agreement is inadequate or excessive, the Director shall refuse to record the memorandum of the agreement … .
Regulation 12(1a)
A memorandum of an agreement referred to in section 76 of the Act shall be in the form of Form 15C in Appendix 1.
Regulation 12(2)
The memorandum is to include in full particulars of matters for which the agreement provides and, in the case of an agreement as to the compensation that is to be paid under Schedule 2 of the Act, is to identify each item for which the compensation is to be paid and, for each item –
(i) the percentage loss of the full efficient use of a part or faculty of the body for which compensation is to be paid; and
(ii) the amount of compensation; or
…
Regulation 12(3)
The memorandum is to be signed by or on behalf of each party to the agreement and …
51 In order for a worker to be entitled to a lump sum in respect to a permanent impairment he must, pursuant to the Act, make an election during his lifetime by completing and signing an election in the form of Form 1A in Appendix 1.
52 That form of election must be signed by the worker personally. It is a right which is personal to the worker and is not available to his personal representative after his death: Moyle v Minister for Works (1979) WAR 183 (at line 50). The election is not merely procedural but is substantive. Upon that election being made specific provisions of s 76 – s 78 come into play including a mandatory review by the Director.
53 Relevantly, the statutory regime under the Act for there to be a payment to a worker who seeks a lump sum in respect to a permanent impairment is:
(a) the degree of permanent impairment is agreed or determined (s 31H(2));
(b) then the worker may make an election by signing, during his lifetime, an election in the form of Form 1A in Appendix 1 (s 31C);
(c) a Memorandum of Agreement is signed by or on behalf of the worker and the employer and is sent to the Director;
(d) the Director, upon being satisfied as to the genuineness of the agreement and as to the adequacy of the amount thereof, is to then record such memorandum which shall then be enforceable as an award or order made by an arbitrator (s 76(1)).
54 The combined purpose of s 76 – s 78 is to regulate all forms of settlement of all forms of compensation to which a worker is or might be entitled in respect of a compensable injury under the Act: Australasian Correctional Management v Nydegger (2011) WACC C10-2011 [12].
55 Counsel for the appellant submitted that the exchange of the letters resulted in an enforceable agreement being reached by the parties in terms of one of the first two limbs referred to in Masters v Cameron.
56 There the court said at [9]:
Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three cases. It may be one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document. Or, thirdly, the case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract.
57 The court then said that in each of the first two cases there is a binding contract in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution.
58 In my view reliance by the appellant and the arbitrator on these principles is misconceived. The court in Masters v Cameron was considering an agreement made subject to a formal contract – not subject to compliance with statutory provisions.
59 If I am in error in that conclusion such that the formal contract to which any agreement is subject can refer to the execution of documents in compliance with statutory provisions, I am of the view that the exchange of letters had neither effect for which the appellant contends and that the common intention of the parties reflected the third limb to which the court referred.
60 The role of the court in construing a written agreement is to give effect to the common intention of the parties. That intention is to be ascertained objectively, that is to be determined by what a reasonable person would have understood the terms to mean: Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd (2004) 219 CLR 165.
61 Construing the two letters in that way it is clear that the common intention of the parties was that the settlement of Mr Mackellar's claim was subject to and conditional upon compliance with the statutory regime in the Act and the execution of the documents to which reference was there made.
62 To that end:
(a) the degree of Mr Mackellar's permanent impairment under sch 2 was agreed to be 60% of leg at or above the knee (pursuant to s 31H(2)(a));
(b) Mr Mackellar would sign the statutory form of election (pursuant to s 31C(1)) and the Statement of Consequences of Recording a Memorandum of Agreement;
(c) both parties would sign a Memorandum of Agreement containing the relevant terms of the settlement;
(d) the documents would be forwarded to WorkCover WA for review by the Director pursuant to s 76(1) and subject to that review, the Memorandum of Agreement then be recorded/registered.
63 A form of election was not signed by Mr Mackellar during his lifetime. Consequently no concluded agreement between Mr Mackellar and the respondent to settle Mr Mackellar's compensation claim came into effect.
64 In the premises the appellant's claim in the Application must fail.
65 The orders I make are as follows:
1. The appellant have leave to appeal the decision of the arbitrator that he was without jurisdiction.
2. That appeal is allowed.
3. The Application is dismissed.
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