Pages Hire Centre Kogarah v Chapman

[2009] NSWWCCPD 9

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		Pages Hire Centre Kogarah v Chapman [2009] NSWWCCPD 9
APPELLANT:		Pages Hire Centre Kogarah
RESPONDENT:		Paul Dennis Chapman
INSURER:		Allianz Australia Workers Compensation (NSW) Limited
FILE NUMBER:		A1-5494/08
DATE OF ARBITRATOR’S DECISION:		23 September 2008
DATE OF APPEAL DECISION:		28 January 2009
SUBJECT MATTER OF DECISION:		Jurisdiction of the Commission to hear an application for a review under section 55 of the Workers Compensation Act 1987 where no notice served under section 74 of the Workplace Injury Management and Workers Compensation Act 1998; interlocutory orders; section 352(8) of the Workplace Injury Management and Workers Compensation Act 1998
PRESIDENTIAL MEMBER:		Deputy President Bill Roche
HEARING:		On the papers
REPRESENTATION:		Appellant:	Sparke Helmore
Respondent:	Firths
ORDERS MADE ON APPEAL:		Paragraph one of the Arbitrator’s determination of 23 September 2008 is revoked and the matter is remitted to a different Arbitrator for re-determination of the claim. Paragraph two of the Arbitrator’s determination of 23 September 2008 is confirmed.
Each party is to bear his or its own costs of the appeal.

INTRODUCTION

1. The primary issue in this appeal is whether the Workers Compensation Commission has jurisdiction to hear an application by an employer for a review under section 55 of the Workers Compensation Act 1987 (‘the 1987 Act’) in circumstances where it had not first served a notice under section 74 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’). A secondary issue arises as to the need for an employer to properly particularise the basis of its claim for relief under section 55 of the 1987 Act.

BACKGROUND

1. Mr Chapman (‘the worker’) injured his right arm in the course of his employment with Pages Hire Centre (NSW) Pty Ltd (wrongly named as Pages Hire Centre Kogarah in the current proceedings) (‘the employer’) on 12 December 1993. On 11 October 2002, in proceedings in the former Compensation Court of NSW (‘the Court’), the employer consented to an award (‘the award’) providing for the payment of weekly compensation to Mr Chapman in the sum of $140.00 per week from 19 July 2001 to date and continuing under section 40 of the Workers Compensation Act 1987 (‘the 1987 Act’) together with the payment of hospital and medical expenses under section 60 of the 1987 Act.

1. By letter dated 22 May 2007, the employer’s insurer, Allianz Australia Workers Compensation (NSW) Limited (‘Allianz’) advised Mr Chapman that, pursuant to section 54 of the 1987 Act, his weekly compensation payments would cease within six weeks of the date of the letter on the ground that he had not satisfied his job seeking obligations under section 52A(1)(a) of the 1987 Act.

1. By an Application to Resolve a Dispute (Matter No 4182 of 2007) (‘the first application’) registered with the Commission on 7 June 2007, the employer sought “to terminate Compensation Award dated 11 October 2002 pursuant to s 52A Workers Compensation Act 1987.” Mr Chapman’s solicitor, Firths, filed a Reply on 28 June 2007.

1. This application was listed for conciliation and arbitration on 27 July 2007 (‘the first arbitration’). At the arbitration, the employer sought to amend the first application to rely on section 55 of the 1987 Act as an additional or alternative ground for reducing the award. As no prior notice of the intention to rely on section 55 had been given, that application was refused. The first Arbitrator determined the section 52A issue in favour of Mr Chapman on the grounds that he was totally incapacitated for employment by reason of a supervening psychiatric condition and was neither capable of working nor seeking work. By Certificate of Determination dated 27 August 2007, he ordered that the weekly compensation under the award be reinstated.

1. The proceedings the subject of the present appeal were commenced by an Application to Resolve a Dispute (Matter No 5494 of 2008) (‘the second application’) registered in the Commission on 18 July 2008. The employer sought a “reduction in the worker’s award to a nominal amount (no more than $10 per week)”, but provided no grounds on which that application was based and did not refer to any provisions of the legislation. It was not until the arbitration hearing that it became clear that the second application sought a review under section 55 of the 1987 Act.

1. Mr Chapman’s solicitor, Firths, filed a Reply on 4 August 2008, which identified the following issues:

   (a)the Commission had no jurisdiction to deal with the dispute, as it concerned matters not previously notified;

   (b)the second application had not been served on Mr Chapman as required by the Rules;

(c)the second application did not demonstrate a “change in circumstances”;

(d)Mr Chapman remained incapacitated for work to the extent found or, in the alternative, greater than the extent found, and claimed an increase in the award payment;

(e)Mr Chapman’s incapacity was not “solely” due to his psychological impairment, and

(f)the employer was estopped from asserting that Mr Chapman was not totally incapacitated for employment.

1. A different Arbitrator heard the second application on 16 September 2008 (‘the second arbitration’). Counsel for Mr Chapman applied to have the application struck out on the grounds that the Commission did not have jurisdiction to hear the claim because no notice of dispute had been served under section 74 or section 287 of the 1998 Act, or under section 54 of the 1987 Act (T1.50). He also argued that there was no correspondence between the parties to identify the dispute (T1.55) and that Mr Chapman had not been “technically served yet” (T1.57). Even if the Arbitrator held that the Commission had jurisdiction to hear the claim, he argued that it was procedurally unfair to allow the matter to proceed (T2.15).

1. The Arbitrator upheld the jurisdiction argument and made the following ex tempore orders that were later formalised in a Certificate of Determination dated 23 September 2008:

“1.The Application is dismissed.

2.The applicant employer is to pay the respondent worker’s costs as agreed or assessed.”

1. By an appeal filed on 20 October 2008, the employer seeks leave to appeal the Arbitrator’s determination.

ON THE PAPERS

1. Section 354(6) of 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.”

1. Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submission by the parties that the appeal can proceed to be determined on the basis of these 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. 

LEAVE TO APPEAL

Time

1. The appeal was lodged within 28 days of the date of the Certificate of Determination in compliance with section 352(4) of the 1998 Act.

Monetary Threshold

1. In circumstances where no compensation has been awarded, the quantum of compensation “at issue” in the appeal is determined by reference to the application before the Arbitrator and section 352(2)(b) does not apply (see Mawson v Fletchers International Exports Pty Ltd [2002] NSWWCCPD 5). The second application sought to have Mr Chapman’s award of $140.00 per week reduced to “no more than $10 per week”. The future value of Mr Chapman’s award well exceeds the $5,000 threshold in section 352(2)(a) of the 1998 Act. I am therefore satisfied that the monetary thresholds in section 352(2) are satisfied.

Interlocutory

1. Section 352(1) of the 1998 Act provides that a party to a dispute in connection with a claim for compensation may appeal to a Presidential member against a “decision” by an arbitrator in respect of a dispute. Section 352(8), amended on 1 November 2006 by Act 113 of 2005, excludes from the definition of “decision”, “any award, order, determination, ruling or direction of an interlocutory nature prescribed by the regulations.”

1. Clause 200B of the Workers Compensation Regulation 2003, as amended, states “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.”

1. Mr Chapman argues, relying on the decision of Nott v The Western Stores Limited and ors [2007] NSWWCCPD 83 (‘Nott’), that the Arbitrator’s determination is interlocutory and the employer is at liberty to bring a further Application provided proper notice is given and the Application is served.  In Nott, the Arbitrator struck out an Application to Resolve a Dispute under Rule 6(4) of the Workers Compensation Commission Rules 2003 (see now Part 1.6 of the Workers Compensation Commission Rules 2006 (the 2006 Rules)) because of the worker’s failure to comply with certain procedural directions. Leave to appeal was refused because that order was an interlocutory order, as it had not finally determined any issues and the worker was at liberty to seek the same relief in a further application (see Little v State of Victoria (1998) 4 VR 596 and Wickstead v Browne (1992) 30 NSWLR 1 at 11).

1. In the present matter the Arbitrator did not purport to act under the strike out power in Part 1.6 of the 2006 Rules but held that, in the absence of a notice being given under section 74 of the 1998 Act, “the Commission does not have jurisdiction to deal with the claim” (T17.31) and the only option she had was to “dismiss the claim” (T17.35). She also noted that had she not taken that course she would have struck the matter out, as she was satisfied that the Application had not been served on Mr Chapman (T17.44).

1. Whilst an order striking out an application without a determination on the merits will often be an interlocutory order, in the circumstances of the present case that is not so because the Arbitrator has made a final determination on a fundamental question of the Commission’s jurisdiction, which, if unchallenged, creates an estoppel on that issue between the same parties in any future proceedings for similar relief.  In that sense, the Arbitrator’s decision has determined the parties’ rights and is not interlocutory. 

1. Mr Chapman’s argument that the appeal is from an interlocutory order depends on an acceptance of his submission that it is necessary for a section 74 notice to be served before an application can be made for relief under section 55 of the 1987 Act. For the reasons set out at paragraphs [23] to [36] below, that submission is incorrect. Therefore, whilst the employer may be entitled to file a fresh application seeking similar relief to that sought in the second application, if it fails to first serve a section 74 notice (something it does not have to do), it will be met with the same “no jurisdiction” point decided by the Arbitrator in the second arbitration.

1. Therefore, the matter is clearly distinguishable from Nott and the Arbitrator’s finding that she had no jurisdiction is not a preliminary order of an interlocutory nature.

1. I grant leave to appeal.

SUBMISSIONS AND DISCUSSION

1. The employer argues that where a worker is being paid under an award the issuing of a dispute notice advising of an intention to reduce or vary weekly payments is without force and essentially valueless.  It submits that an Application to Resolve a Dispute is all that is required to notify the worker of a dispute in circumstances where a review is sought of an existing award of weekly compensation. 

1. Mr Chapman submitted before the Arbitrator that the Commission had no jurisdiction to deal with the second application because of non-compliance with section 74 or “section 287” [sic, section 289A] of the 1998 Act, or section 54 of the 1987 Act.

1. Section 54 of the 1987 Act can be put to one side because the second application does not rely on that provision.

1. I do not accept the worker’s submission that the Commission does not have jurisdiction to hear the section 55 review application in the absence of a section 74 notice having been served. Sections 74 and 289A of the 1998 Act deal with claims for compensation, not applications for a review under section 55 of the 1987 Act.

1. Section 74(1) provides:

“If an insurer disputes liability in respect of a claim or any aspect of a claim, the insurer must give notice of the dispute to the claimant:” (emphasis added)

1. The term “claim” is defined in section 70 of the 1998 Act to mean:

“a claim for compensation under this Act or claim for damages to which a policy of insurance applies, whether the claim was made before or after the commencement of this Division.” (emphasis added)

1. Section 289A restricts the circumstances in which certain disputes can be referred to the Commission. The section appears in Part 4 of Chapter 7 of the 1998 Act. Chapter 7 deals with “NEW CLAIMS PROCEDURE”, the “GIVING OF NOTICE OF INJURY AND MAKING OF A CLAIM” (Part 2), “DEALING WITH CLAIMS” (Part 3), “CLAIMS FOR LUMP SUM COMPENSATION AND WORK INJURY DAMAGES” (Division 4), and “COMPENSATION DISPUTE DETERMINATION” (Part 4).

1. The first section in Part 4, section 287, is headed “Disputes to which Part applies”.  It states:

“287(1)   This Part applies to a dispute in connection with a claim for compensation between:

(a)the person who makes the claim and a person on whom the claim is made, or

(b)the employer on whom the claim is made and the insurer on whom the claim is made.

(2)          …” (emphasis added)

1. Section 288 provides that any party to a dispute “about a claim” may refer the dispute to the Registrar for determination by the Commission.  Section 289 restricts the circumstances in which a “dispute about a claim for weekly payments” (emphasis added) can be referred to the Commission for determination. Section 289A sets out further restrictions as to when a “dispute” can be referred to the Commission. To be consistent with section 289, the reference to “dispute” in section 289A can only be a reference to a “dispute about a claim for weekly payments” (emphasis added).

1. In the present matter, the Commission is not being asked to consider “a claim” for compensation. The second application seeks, as was belatedly revealed at the arbitration, though it was not apparent on the face of the second application, a “review” under section 55 of the 1987 Act. An application seeking a “review” is not “a claim” for compensation, but is an application that any weekly payment of compensation “be reviewed by the Commission at the request of the employer or the worker or the Authority” (see section 55(1)). On such a review “the weekly payment may be ended, reduced or increased” (section 55(2)(a)).

1. It follows that neither section 74 nor section 289A apply to an application for a “review” under section 55. The Commission’s jurisdiction to hear a section 55 application for review is found in section 105 of the 1998 Act, which provides that “the Commission has exclusive jurisdiction to examine, hear and determine all matters arising under” the 1998 Act and the 1987 Act. Therefore, it is clear that the Commission does have jurisdiction to hear and determine a section 55 application for review without the need for a section 74 notice to be served.

1. However, employers must remember that all applications seeking substantive relief should clearly state the section or sections of the legislation upon which the application is based and must clearly particularise the grounds on which that relief is sought (as to the provision of particulars in general, see Dare v Pulham (1982) 148 CLR 658 at 664). The second application did neither of those things. If that is not done a worker (or an employer in the case of an application by a worker) will not be in a position to know the case he or she is to meet and the resolution of the matter will be unreasonably delayed while particulars are provided. In an extreme case, a failure to properly particularise a claim may result in an application that the proceedings be dismissed on the grounds that they are “frivolous or vexatious or otherwise misconceived or lacking in substance” (see section 354(7A)(b) of the 1998 Act). It is most certainly not sufficient particularisation of an application for a section 55 review to say, as was said in this case, that the worker knew about the claim because leave was sought (but refused) to argue the matter at the first arbitration. Full particulars should have been provided in the second application.

1. In respect of the question of service of the second application, Mr Chapman’s counsel wrongly submitted, “it’s got to be served personally” (T11.10).  The second application did not have to be served personally on Mr Chapman, but had to be served at Mr Chapman’s last known postal address (Part 8.3(2) of the 2006 Rules).  It is not disputed that the second application was served on Mr Chapman’s solicitors, Firths.  In circumstances where Firths had not agreed to accept service of the documents, the employer’s argument that it was not unreasonable for it to serve Firths demonstrates a fundamental misunderstanding of the correct procedures to be followed.  In the absence of agreement by Firths to accept service of the second application, it should have been served at Mr Chapman’s last known postal address, as required by the 2006 Rules.

1. However, that was not the end of the matter. Firths filed a Reply on behalf of Mr Chapman on 4 August 2008. The Reply was not filed under protest, as was submitted at the arbitration, but wrongly asserted that the rules required that the second application had to be served personally on Mr Chapman. There is no requirement that an application for a review under section 55 be served personally. The purpose of the provisions relating to service of applications such as that made under section 55 is to ensure that the respondent (the worker in this instance) is notified of the orders being sought and has the opportunity to respond. That purpose was achieved in the present matter. The filing of a Reply by Firths was a clear acknowledgment that Mr Chapman had received the second application and that they had instructions to act for him in respect of it. Mr Chapman’s argument about non-service of the second application was, in the circumstances of this case, specious.

CONCLUSION

1. It follows that the Arbitrator erred when she dismissed the second application and her determination must be revoked and the matter re-determined before a different Arbitrator. However, as I noted at [34] above, an applicant (be it an employer or a worker) seeking a review under section 55 of the 1987 Act must, in the body of the Application to Resolve a Dispute, properly and fully particularise the grounds on which he or she relies in support of the application so that the respondent is fully informed about the case with sufficient clarity to allow a fair opportunity to meet it. That has not been done in the present matter.

1. Though the future conduct of this matter will be a matter for the Arbitrator who hears the re-determination, it seems appropriate that, at the least, an amended application will be required setting out full particulars of the claim and the basis on which it is made and noting the employer’s correct legal identity (Pages Hire Centre (NSW) Pty Ltd).  Mr Chapman will be entitled to a reasonable time in which to respond and gather such evidence as is necessary to meet the claim.

1. Further, if Mr Chapman wishes to seek an increase in his award of weekly compensation by way of a review under section 55, as his Reply suggests, it will be necessary for him to file and serve an Application to Resolve a Dispute fully particularising the basis for that increase. Such a claim cannot be made by making a general assertion in the Reply, as has been done in this matter.

1. Effectively, the claim has to be commenced again with the filing of an Amended Application to Resolve a Dispute properly particularising the claim and the basis on which it is made.  In these circumstances it is appropriate that the Arbitrator’s costs order made on 23 September 2008 be upheld.  The costs of the re-determination are at the discretion of the Arbitrator who hears that matter.

DECISION

1. Paragraph one of the Arbitrator’s determination of 23 September 2008 is revoked and the matter is remitted to a different Arbitrator for re-determination of the claim.

1. Paragraph two of the Arbitrator’s determination of 23 September 2008 is confirmed.

COSTS

1. Each party is to bear his or its own costs of the appeal.

Bill Roche
Deputy President

28 January 2009

I, MELANIE CURTIN, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF BILL ROCHE, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE