O'Donnell and K & S Freighters Pty Ltd (Compensation) - [2020] AATA 1714

O'Donnell and K & S Freighters Pty Ltd (Compensation) [2020] AATA 1714 (12 June 2020)
Division:GENERAL DIVISION
File Number(s): 2019/8340
Re:John O'Donnell
APPLICANT

K & S Freighters Pty LtdAnd
RESPONDENT

Decision
Tribunal:The Hon. John Pascoe AC CVO, Deputy President
Date:12 June 2020
Place:Sydney

The application for an extension of time is refused.
...............................[sgd]........................................
The Hon. John Pascoe AC CVO, Deputy President
Catchwords
EXTENSION OF TIME – determination of normal weekly earnings – where original decision made almost ten years prior to application for review – where applicant has issues with literacy – where applicant changed legal representation – where applicant had other proceedings before the Tribunal – principles to be applied – whether substantive application has reasonable prospects of success – where delay causes prejudice to the respondent – whether it would be fair in the circumstances – extension of time refused
Legislation
Safety Rehabilitation Compensation Act 1988 (Cth)
Cases
Brisbane South Regional Health Authority v Taylor [1996] HCA 25
Hunter Valley Developments Pty Limited; Anthony Neary Walker; Mende Brown v the Honourable Barry Cohen Minister of Home Affairs and Environment [1984] FCR 344
Rahimzadeh and Secretary, Department of Social Services [2019] AATA 3201
Comcare v A’Hearn (1993) 45 FCR 441
REASONS FOR DECISION
12 June 2020
Background

The Applicant is employed by the Respondent, K & S Freighters Pty Ltd.
The Applicant lodged a claim under the Safety Rehabilitation Compensation Act 1988 (Cth) (‘the Act’) with his employer on 10 November 2009 for compensation for sustained injuries to his left leg, groin, right shoulder and right wrist.
In the initial decision dated 15 December 2009, the respondent determined that, in respect of injuries that the applicant was said to have sustained, the applicant’s normal weekly hours were 42.17 hours, that the applicant’s normal weekly earnings was determined to be $1072.52 and that the applicant’s entitlement to incapacity compensation for the period 21 October 2009 to 8 December 2009 was to be calculated in accordance with the table below:
Nearly 10 years later, the applicant requested a re-consideration of this initial decision. In a reviewable decision dated 16 December 2019 the respondent declined to extend the time in which to undertake the reconsideration when considering the delay, prejudice, merits and fairness of this request.
The decision before the Tribunal is whether the applicant should be granted an extension of time to review this decision, in this case approximately 10 years after the initial decision.
It was agreed between the parties that the decision in relation to the extension of time is a reviewable decision by the Tribunal.
The Tribunal notes that the initial decision under the respondent’s license was issued pursuant to the Act by Insurance Australia Limited trading as CGU Self Insurance Services, which was authorised as claims manager for the respondent. By the time of the reviewable decision, the respondent K & S Freighters Pty Ltd had taken over the claim management function itself, in accordance with its license. This explains why the initial decision was made by CGU and the reviewable decision was made by the respondent.
The applicant’s evidence
At the hearing, the applicant made reference to his statement of 6 February 2020 and in particular drew attention to paragraph three, which dealt with the problems that he had experienced from early in his schooling history in relation to reading, writing and comprehension. He said he was “is not very literate”.
The applicant said that he commenced work in 2007 as a casual employee for three months for the respondent, and later became a full-time employee. He is still employed by the respondent.
Under cross-examination, the applicant said that although his problems could be described as lifelong, he had not sought any assistance or help in relation to his comprehension issues.
The applicant said that he had never comprehensively compared his compensation payments to his payslip after he received the initial advice from CGU. The applicant claimed not to have noticed the significant difference in the payments made by way of compensation as against his normal pay. He said he only looked at his payslip and bank statements.
The applicant also gave evidence that there were regular variations in his payslips as a result of overtime worked. Again, he said he only checked his payslips against his bank statements. He went on to give evidence that he ultimately decided to stop opening letters in relation to payments made to him and that he just put them “in a pile”.
The applicant told the Tribunal that he could not remember whether he provided documents and the letters to his solicitors at the time of the 2014 proceedings before the Tribunal which related to the denial of liability. However, he thought he may have taken these documents to Maurice Blackburn, his previous representatives, sometime in approximately 2014 to 2015. The applicant said that in 2017 he told his current solicitor, Mr Joshua Clark, who was previously his representative at Maurice Blackburn lawyers, that the payslips and other documents were “in my files”.
Attention was drawn to Paragraph 11 of the applicant’s statement in which he said that he did not receive any advice to challenge the decision of 15 December 2009 until July 2019. Indeed, the question of challenging the calculation of normal weekly earnings in 2009 does not seem to have ever been considered before that date.
Submissions on behalf of the applicant
In submissions, counsel for the applicant referred to a number of previous Tribunal decisions along with the decision of Justice McHugh in Brisbane South Regional Health Authority v Taylor [1996] HCA 25, which were also contained in the respondent’s submissions to the Tribunal. Counsel sought to make a distinction between the application of what was said by his Honour to common-law cases as against administrative decisions. Counsel for the applicant also drew the Tribunal’s attention to a number of decisions by different Tribunal members in relation to the extension of time application.
It was accepted that the 10-year period was a very long delay, but counsel submitted that it was primarily due to ongoing literacy problems and the proceedings before the Tribunal.
Counsel for the applicant outlined the proceedings before the Tribunal in 2014 where the applicant was unsuccessful, the appeal to the Federal Court of Australia and the 2016 decision of the Tribunal where the applicant was successful. Counsel submitted that from 2012 to 2016 the applicant was concentrating on the liability issue and accordingly was focused on that rather than the amount of payment.
It was submitted on behalf of the applicant that he was only alerted to the issue of normal weekly earnings as at the date of injury by the respondent’s filing its third Statement of Facts, Issues and Contentions in June 2019.
Reference was made to the fact that at a directions hearing by telephone on 22 July 2019 a previous hearing date was vacated because the applicant said he needed to get information about normal weekly earnings.
Counsel drew attention to the fact that the applicant had relied upon his lawyers, particularly in light of his literacy problems. It was also noted that in June 2019 the applicant had changed his lawyers.
It was put on behalf of the applicant that there was no prejudice to the respondent if the normal weekly earnings issue were to be reopened, as all the payroll records were available and that the normal weekly earnings issue was part of a much longer legal case.
It was further put on behalf of the applicant that the respondent should demonstrate why the statutory fallback position in relation to the calculation of the applicant’s normal weekly earnings was not used, even though it was open to the respondent.
Counsel also sought costs on behalf of the applicant, although accepted that this was unusual before the Tribunal.
Submissions on behalf of the respondent
Counsel for the respondent drew attention to the fact that it would normally be expected that the applicant would have a reasonable explanation for delay, which was not the situation in this case.
The respondent did not agree with the submissions of the applicant in relation to the remarks of Justice McHugh in Brisbane South Regional Health Authority v Taylor [1996] HCA 2, and said that those remarks had general application, not just in common law.
Counsel drew attention to the length of time passed in this matter and the fact that the applicant had never put in an application to challenge the normal weekly earnings issue in earlier litigation which went on for some three or four years, nor had it been raised in the 30 day period allowed after the original decision.
The issue of normal weekly earnings had in fact been raised by the respondent in its Statement of Facts, Issues and Contentions as part of looking at normal weekly earnings rates, because of changes in awards and agreements in the period from 2010 to 2016.
The respondent noted that in its letter, notably page 82, the applicant’s lawyer was fully appraised of the question but did not ask for any further information. He merely said that the calculation should have been based on a period of two weeks or 12 months. He made no observation as to what would be preferable. It was submitted that the actions of the respondent were lawful and appropriate.
Counsel for the respondent also said that the respondent only raised the issue of normal weekly earnings because it was required to set out the issues in the context of the 2016 application and the effect of any changes to the normal weekly earnings. There was no reason for the applicant to ask for a calculation of the difference between two weeks, 12 weeks or 52 weeks. The applicant did not identify what the difference would be and there was no reason for the respondent to make such a calculation as part of the current proceedings before the Tribunal.
As far as the respondent was concerned, the issue of the 2009 calculation had been settled a long time ago and there was no reason not to regard it as a matter of ongoing contention.
Discussion
There is agreement between the parties that the respondent’s decision in this matter is a reviewable decision.
The principles in relation to the granting of an extension of time are well established. There is relevant High Court and Federal Court authority which provides a guide to the Tribunal in making its decision
The remarks of Justice McHugh in Brisbane South Regional Health Authority v Taylor [1996] HCA 25 sets out a number of principles to be considered being whether to grant an extension of time. His honour noted that:
(a)First, as time goes by, relevant evidence may be lost.
(b)Second, it is oppressive to a defendant to allow an action to be brought long after the circumstances which gave rise to it have passed.
(c)Third, people should be able to arrange their affairs and utilise their resources on the basis that claims are not then later made against them.
(d)Finally, the public interest requires that disputes be settled as quickly as possible.
The principles to be applied in the current situation are usefully summarised in the decision of Member Bygrave in Rahimzadeh and Secretary, Department of Social Services [2019] AATA 3201 at [5] – [8]:
Pursuant to subsection 29(7) of the AAT Act, the Tribunal may extend the time for lodging an application if it “is satisfied that it is reasonable in all the circumstances to do so” [emphasis added].
The principles to be applied in determining an application for an extension of time have been set out by Wilcox J in Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344 at [348] and [349] paraphrased as follows:
(a)an applicant must show an “acceptable explanation of the delay” and that it is “fair and equitable in the circumstances” to extend the time;
(b)a distinction is to be made between an applicant who has “rested on his rights” and allowed the decision-maker to believe that the matter was finally concluded, and one who has continued to make the decision-maker aware that he or she contests the finality of the decision;
(c) any prejudice to the respondent caused by the delay;
(d)whether the general public would suffer any prejudice as a result of the extension;
(e) the merits of the substantial application; and
(f)“considerations of fairness as between the applicant and other persons” in a similar position.
These principles are not to be applied mechanically. For example, an “acceptable explanation for the delay” is not an essential precondition for the exercise of the discretion, although it is to be expected that such an explanation will normally be given: Comcare v A’Hearn [1993] FCA 498 [15]; (1993) 45 FCR 441, 444.
All of the circumstances of the case must be considered; the overriding consideration being whether it is “reasonable in all the circumstances” to grant the extension.
I do not accept the submission of counsel for the applicant that the comments of Justice McHugh are not as relevant to administrative proceedings before this tribunal. In my view, they are clearly of broad application in all judicial or quasi-judicial and administrative proceedings, and I have exercised my discretion in considering these principles.
The comments of Wilcox J are well accepted as the basis for decisions in cases such as that currently before the Tribunal. Turning to the various issues to be considered in relation to the current case, I will deal with each in turn.
Does the applicant have an acceptable explanation of the delay and is it “fair and equitable in the circumstances” to extend the time?
In this case, the applicant has delayed nearly 10 years until requesting a reconsideration of the decision. His primary explanation for the delay is his issues with literacy, which have affected his capacity to read since the time he attended school. At the hearing he said that he ignored documents because of his difficulties with comprehension and that he had no one readily available to help him.
The applicant’s representative also submitted that other reasons for the delay were that the applicant had not received legal advice on this matter at the time of the initial decision, that he was in the process of litigating broader issues with the respondent and that the decision did not provide details of reasons that would have alerted the applicant, a ‘lay person’, to any potential miscalculations.
In relation to the compensation the applicant received following his accident, he said that he did not compare the difference between his pay prior to the accident and the amounts paid to him after compensation. He said he only ever compared his bank account statement to the notification he received as to the fortnightly payment made to him. He also gave evidence that after a period of time he ignored the communications altogether and simply put them into a pile, which it appears he ultimately handed to his solicitors some years later (probably around 2014).
There is no evidence that he ever discussed or even gave thought to discussing the contents of the un-opened mail with his solicitors or that he ever raised an issue of the calculated amount he was paid in compensation as compared to his normal weekly earnings prior to the accident. The applicant has, however, been afforded and taken the opportunity to seek legal advice in relation to previous matters before the Tribunal.
I note that the initial decision contained a Notice of Rights. The applicant did not take advantage of this opportunity which set out the applicant’s right to reconsideration and a phone number if the applicant had any queries about the payment. The applicant chose to do nothing.
It appears that it is only in more recent times that the applicant’s legal representatives have agitated over the initial normal weekly earning calculations, notably since it was raised by the respondent in its Statement of Facts, Issues and Contentions in proceedings before this Tribunal in relation to proceedings which commenced in 2016.
Whilst I have some sympathy for the applicant’s incapacity in relation to literacy, I do not accept this is of itself an acceptable explanation for a delay of almost 10 years, particularly when the applicant was initially given an opportunity to raise any questions about the original decision, including by telephone but did not do so and has had access to legal advice during the interim period. However, the applicant appears never to have raised the issue with his solicitors nor with his employer and despite being advised of his opportunity to query the initial decision.
The fact that the applicant gave evidence that he had noticed differences in payments made to him in relation to over-time raises a question as to why he would ignore the initial calculation of normal weekly earnings which is central to the calculation of what he received on an ongoing basis.
There is no evidence that either the applicant `nor his solicitors ever considered the issue of normal weekly earnings and certainly did not raise normal weekly earnings with the respondent prior to recently.
Considered as a whole, it is such that I find that it is not fair and equitable to extend the time.
Has the applicant “rested on his laurels”?
It is clear from the evidence presented to the Tribunal that the applicant made no attempt to raise the issue of normal weekly earnings with the respondent or CGU after the initial decision, despite advice as to his rights to do so. To the contrary, his evidence was that he did not make a comparison between the amount he was receiving as compensation and in normal weekly earnings.
Further, he ultimately elected not to even open the correspondence and was vague about when and if he ultimately took either the opened or unopened correspondence to the solicitors who were advising him at the time.
Again, the applicant appears to have become interested in the calculation of his normal weekly earnings after it was raised by the respondent in its Statement of Facts, Issues and Contentions in relation to subsequent proceedings before the Tribunal which relate to liability. Even at the time of the directions hearing the applicant gave no indication that he had ever raised the matter with the respondent. He was given the opportunity to explore the matter but seems not to have used the opportunity to identify if any alternative calculation might be of benefit to him.
The fact that the applicant did nothing over such a long period despite having several opportunities to do so is significant and is not outweighed by the various impediments he faced.
Accordingly, it is difficult to conclude that the applicant did anything other than ‘rest on his laurels’ for all or most of the nearly 10-year period since the original decision.
Was there any prejudice to the respondent caused by the delay?
The respondent is entitled to assume that matters finalised some 10 years ago, and which are not challenged within the requisite period, are final.
The applicant’s representative’s submissions in their Statement of Facts, Issues and Contentions are that there would be no question of prejudice for the respondent, as all the information necessary to perform a recalculation of the applicant’s normal weekly earnings is available to the respondent and the Tribunal. There was not detailed evidence as to whether the re-calculation would involve any financial imposition for the respondent in relation to payments previously made or future payments. Rather, the applicant seemed to want an explanation as to why the respondent had chosen the method of calculation it did and whether a different method of calculation would have yielded a different result.

These are surely matters which should have been raised at the time the original calculations were made or within the time period. At the very least, one would have expected the issue to be raised when the applicant took his unopened correspondence to his solicitors in 2014 or 2016.
If the applicant were permitted to re-open the issue of re-calculation of the normal weekly earnings nearly 10 years after the original decision, I am of the opinion that the respondent would suffer prejudice due to the effluxion of time. On the assumption that this matter was finalised, the respondent has factored in potential incapacity cost in its actuarial estimates, deducted appropriate taxes and engaged in subsequent decision making on matters relating to this brought by the applicant, amongst other things. The respondent’s insurance arrangements have changed, and it is entitled to regard issues dealt with before the change of insurers as settled, particularly if the issue has never been raised since 2009.
If the applicant were allowed to re-open a matter after nearly 10 years, the respondent may be in a position where many other claims thought to be settled may be re-agitated at significant cost and inconvenience.
Whether the general public would suffer any prejudice?
I do not find prejudice to the general public from the granting of an extension.
The merits of the application?
I find that on the evidence the application seems to be an opportunistic seizing on an issue raised by the respondent in another context, rather than an application based on merit. The applicant notes that they will potentially lose a significant amount in lost incapacity payments from 2009, but was unable to point to the exact benefit to him if the extension of time is granted and the normal weekly earnings are to be recalculated, or anything specific on how the initial determination made by the respondent is wrong.
The respondent’s representative explained in their Statement of Facts, Issues and Contentions that normal weekly earnings were calculated over a period of 12 weeks to more accurately reflect the amount earned by the applicant over a period of time, whilst accounting for over-time hours worked by the applicant. The respondent noted that they made these calculations based on their discretion pursuant to section 8(5) of the Act, which provides that the respondent can calculate normal weekly earnings over a time period they consider reasonable for the purposes of arriving at an amount that fairly represents the weekly rate at which the employee was being paid.
The respondent’s representatives also noted that the methodology used to calculate the applicant’s normal weekly earnings had been subjected to an audit pursuant to the Act and had not been challenged by any other employee receiving payments.
Accordingly, as the applicant did not provide specific particulars for how the determination made by the respondent is incorrect, other than disputing the period of 12 weeks in which the normal weekly earnings was calculated, I find that the merits do not weigh in the applicant’s favour.
Considerations of fairness?
It would seem unfair for the applicant to be able to reopen the issue of normal weekly earning calculations after a lapse of almost 10 years when it is likely that others in a similar position raised any objections within the 30 day period allowed for such objections and of which the applicant must have been aware.
After careful consideration of all the circumstances of this case and the evidence presented, I find it hard to see why and extension of time should be granted. All the evidence points to the applicant having done nothing to consider or rectify any issues in calculations (assuming there were any), and even now there is no explanation as to the specific benefit to the applicant if the original in normal weekly earnings calculation is to be reopened.
There is nothing in the evidence to suggest that the respondent contributed in any way to the delay on the part of the applicant. On the contrary, the respondent appears to have been quite open and transparent as to the formula used for the normal weekly earnings calculations and the applicant’s rights to challenge the original decision apply within the time frame allowed. Indeed, the matter only appears to have become of interest to the applicant because of the respondent’s desire to make a full explanation in its Statement of Facts, Issues and Contentions to the Tribunal in relation to the current proceedings.
The applicant could have spoken to his employer about the calculations when he originally received notification of the compensation payments to be made to him as compared to his normal weekly earnings. He chose not to do so. He could also have spoken to a third party as outlined in the statement given to him after the original decision which included a number to call, but there is no evidence that he ever did so. Indeed, he did not even raise it with his solicitors in 2014 to 2016.
On balance, it must be said that there has been no explanation which justifies a delay of almost 10 years in seeking to reopen the original calculation of normal weekly earnings.
Costs
It can only be seen as unusual that the issue of costs was raised by counsel for the applicant. As I have decided to refuse the application for an extension of time, it is not necessary for me to deal with any costs to be awarded, noting in particular that the respondent did not seek such an order.
Decision
The correct and preferable decision is that the application for an extension of time is refused.

I certify that the preceding 68 (sixty-eight) paragraphs are a true copy of the reasons for the decision herein of The Hon. John Pascoe AC CVO, Deputy President.

................................[sgd]........................................
Associate
Dated: 12 June 2020

Date of hearing: 25 May 2020

Counsel for the Applicant: Mr J Mrsic

Solicitors for the Applicant: Mr J Clarke

Counsel for the Respondent: Mr J Wallace

Solicitors for the Respondent: Mr D Clarke

Date of hearing:	25 May 2020
Counsel for the Applicant:	Mr J Mrsic
Solicitors for the Applicant:	Mr J Clarke
Counsel for the Respondent:	Mr J Wallace
Solicitors for the Respondent:	Mr D Clarke