Powell v McClenahan & Ors

CERTIFICATE OF DETERMINATION OF MEMBER
CITATION:	Powell v McClenahan & Ors [2024] NSWPIC 139
APPLICANT:	Jane Margaret Powell
FIRST RESPONDENT:	Wincott Enterprises Trustee for the James Winter Family Trust trading as SSJ Farming
SECOND RESPONDENT:	Jason Paul McClenahan
THIRD RESPONDENT:	Blake James McClenahan
FOURTH RESPONDENT:	Bruce Ronald McClenahan
SENIOR MEMBER:	Kerry Haddock
DATE OF DECISION:	21 March 2024
CATCHWORDS:	WORKERS COMPENSATION - Claim for lump sum death benefit and interest on lump sum; liability accepted; matter had lengthy history, with two prior Applications being discontinued; parties agreed on proposed apportionment of lump sum death benefit, and findings and orders made; parties unable to agree on resolution of claim for interest, and direction for submissions made; consideration of Haidary v Wandella Pet Foods Pty Limited, Dynamix Pty Ltd and Burrangong Pet Foods Pty Ltd, Kaur v Thales Underwater Systems Pty Ltd, Kathryn Ann Kratz as executrix of the estate of the Late Owen Beddall v Qantas Airways Limited, Shanika Cooper v G & W Mudge Concreting Pty Ltd & Ors, Delta Services Pty Ltd v BBV & Ors, Lavelle v David Paul Browne & others, Bennett v Jones, Beves v Patrick Stevedores No 2 Pty Ltd & Anor, Goulburn Flight Training Centre Pty Limited v Druck & Ors, AFF Properties Pty Ltd v Robovich & Ors, BDU by next friend BKO & Ots v State of New South Wales (NSW Police Force) & Ors; Held – award of interest to applicant, second respondent, third respondent and fourth respondent from date on which each party’s claim was duly made to date when orders for payment of lump sum made; interest awarded at rate that is 2% above applicable Reserve Bank of Australia cash rate.
DETERMINATIONS MADE:	The Commission determines: 1. The first respondent is to pay to the applicant, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, interest on the sum of $508,235 as follows: (a) from 20 June 2019 to 2 July 2019 at the rate of 3.25% per annum; (b) from 3 July 2019 to 1 October 2019 at the rate of 3.00% per annum; (c) from 2 October 2019 to 3 March 2020 at the rate of 2.75% per annum; (d) from 4 March 2020 to 19 March 2020 at the rate of 2.50% per annum; (e) from 20 March 2020 to 3 November 2020 at the rate of 2.25% per annum; (f) from 4 November 2020 to 3 May 2022 at the rate of 2.10% per annum; (g) from 4 May 2022 to 7 June 2022 at the rate of 2.35% per annum; (h) from 8 June 2022 to 5 July 2022 at the rate of 2.85% per annum; (i) from 6 July 2022 to 2 August 2022 at the rate of 3.35% per annum; (j) from 3 August 2022 to 6 September 2022 at the rate of 3.85% per annum; (k) from 7 September 2022 to 4 October 2022 at the rate of 4.35% per annum; (l) from 5 October 2022 to 1 November 2022 at the rate of 4.60% per annum; (m) from 2 November 2022 to 6 December 2022 at the rate of 4.85% per annum; (n) from 7 December 2022 to 7 February 2023 at the rate of 5.10% per annum; (o) from 8 February 2023 to 7 March 2023 at the rate of 5.35% per annum; (p) from 8 March 2023 to 2 May 2023 at the rate of 5.60% per annum; (q) from 3 May 2023 to 6 June 2023 at the rate of 5.85% per annum; (r) from 7 June 2023 to 7 November 2023 at the rate of 6.10% per annum, and (s) from 8 November 2023 to 5 February 2024 at the rate of 6.35% per annum. 2. The first respondent is to pay to the second respondent, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, interest on the sum of $117,285 as follows: (a) from 11 December 2023 to 5 February 2024 at the rate of 6.35% per annum. 3. The first respondent is to pay to the third respondent, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, interest on the sum of $117,285 as follows: (a) from 4 September 2023 to 7 November 2023 at the rate of 6.10% per annum; and (b) from 8 November 2023 to 5 February 2024 at the rate of 6.35 % per annum. 4. The first respondent is to pay to the fourth respondent, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998, interest on the sum of $39,095 as follows: (a) from 13 December 2023 to 5 February 2024 at the rate of 6.35% per annum.

STATEMENT OF REASONS

BACKGROUND

The worker, Paul Graham McClenahan (Mr McClenahan) was employed by the first respondent, Wincott Enterprises Trustee for the James Winter Family Trust trading as SSJ Farming, (SSJ Farming), on its property.
On 15 February 2018, Mr McClenahan died when he suffered a heart attack and fell into an irrigation canal.
The applicant in these proceedings, Jane Margaret Powell (Ms Powell), is the widow of
Mr McClenahan. The second respondent, Jason Paul McClenahan, and the third respondent, Blake James McClenahan, are the sons of Ms Powell and the worker. The fourth respondent, Bruce Ronald McClenahan, is the worker’s father.
I will refer to those claimants whose family name is McClenahan by their given names to avoid confusion, meaning no disrespect to them.
The matter has had a protracted history.
On 13 November 2018, the first respondent’s insurer, Employers Mutual NSW Limited (EML), wrote to the applicant, confirming that it had accepted liability to pay compensation for Mr McClenahan’s death. That compensation comprised the lump sum death benefit, pursuant to s 25 (1) of the Workers Compensation Act 1987 (the 1987 Act); funeral expenses of up to $15,000, pursuant to s 26 of the 1987 Act; and weekly payments for any dependent children, pursuant to s 25 (2) of the 1987 Act.
SSJ Farming brought proceedings in Matter Number 2638 of 2019. The other parties to the proceedings were Ms Powell, Jason, and Blake.
Matter Number 2638 of 2019 was discontinued before Senior Arbitrator Capel, as he then was, on 28 June 2019.
Blake brought proceedings in Matter Number W6400 of 2023. SSJ Farming, Ms Powell, and Jason were the respondents in those proceedings.
Matter Number W6400 of 2023 was discontinued before Member Perrignon on
3 October 2023.
This Application in Respect of Death of Worker (the Application) was lodged by the applicant on 17 November 2023.
The Application sought apportionment of the lump sum death benefit between those dependent on the worker at the time of his death; and the payment of interest on the lump sum, pursuant to s 109 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act).
The third respondent lodged his Reply on 4 December 2023
The second respondent lodged his Reply on 11 December 2023.
The first respondent lodged its Reply on 13 December 2023.
The fourth respondent lodged his Reply on 13 December 2023.

ISSUE FOR DETERMINATION

The following issue remains in dispute:
(a) whether interest is to be paid on the death benefit and if so, the rate/s of interest and the period/s over which it is to be awarded.

PROCEDURE BEFORE THE COMMISSION

The matter was listed for preliminary conference on 5 February 2024. Mr Fogarty appeared for the applicant; Mr Studdert appeared for the first respondent; Mr Edwards appeared for the second respondent; Mr Grady appeared for the third respondent; and Mr Williams of counsel, instructed by Mr Cullenward, appeared for the fourth respondent. Ms Asvestas of EML and Ms Dean of icare also attended.
The applicant and the second, third and fourth respondents were able to agree on a proposal for apportionment of the lump sum death benefit.
I was satisfied that the proposed apportionment of the lump sum was appropriate in the circumstances, noting that the amount apportioned to the fourth respondent included reimbursement of the worker’s funeral expenses, which it was agreed he had paid.
The parties were unable to agree on a resolution of the claims for interest. They were therefore directed to lodge and serve written submissions on the issue of the claim for interest, after which it would be determined “on the papers”.
The parties’ submissions have now been received.

EVIDENCE

Documentary evidence

The following documents were in evidence before the Personal Injury Commission (Commission) and considered in making this determination:
(a)     the Application and attachments;
(b)     Reply by third respondent;
(c)     Reply by second respondent;
(d)     Reply by first respondent and attachments, and
(e)     Reply by fourth respondent.

FINDINGS AND REASONS

As the only matter to be determined is the claim for interest, it is unnecessary that I discuss all of the evidence.

Evidence of the applicant, Jane Margaret Powell

Ms Powell affirmed an affidavit on 17 June 2019.
She had been in a de facto relationship with the worker since 1996. They had two children, Jason, who was born in 1999; and Blake, who was born in 2004. Copies of their birth certificates were attached.
Blake was in year 8 at high school. Before the worker’s death, Jason did seasonal work with him, helping with harvesting and cotton picking, but had not done any work since that time.
She and the worker shared all their money. However, each had their own account. She managed their money and paid their expenses. She used money from Mr McClenahan’s account to pay all their bills. She also used money from either her or his account to help pay for other expenses, including helping with the boys.
The worker had not been married before they started their relationship. As far as she was aware, only she, Jason, and Blake had been or were financially dependent on the worker.
Blake was living with her mother in Tamworth because he was going to high school there. Jason was living with her.
Ms Powell provided details of a car loan and a personal loan. The affidavit referred to the attachment of various financial information, some of which was not attached.

Evidence of the second respondent, Jason Paul McClenahan

Jason affirmed an affidavit on 18 June 2019. It apparently formed part of the evidence in Matter Number 2638 of 2019, lodged as an attachment to a Reply in those proceedings.
Jason was then aged 20.
Jason stated that he understood that as his father had passed away, “and it had something to do with work”, EML would pay his family $781,900 in lump sum compensation, funeral expenses, and his brother Blake would get weekly payments because he was at school.
Jason and his mother had discussed the lump sum payment. They agreed that he and Blake would each get $100,000. They all agreed that they would try and buy a property with the remainder of the money. They would look to buy a property near Tamworth, and they would need $400,000 or $500,000 for the property.
Jason was very satisfied with the proposed arrangements.
Jason’s statement is dated 21 September 2023. He was then 24 years old.
He left school after Year 8, as there were difficulties with school, and he was being assessed for attention deficit hyperactivity disorder (ADHD) at its request. He had not been diagnosed with ADHD.
He left school at approximately 14 and his father assisted him to obtain casual farm work on the property where he was employed. This included working during the wheat harvest, and whatever other work that was available. He relied on his father to take him to and from work, as he did not then have, and still did not have, a driver’s licence.
He continued to reside with his father, mother, and brother after leaving school. He had worked on and off undertaking seasonal farm labouring work since that time.
During that period, he was supported by his father, as often he was not working. He was not required to pay rent or board whilst living at home, and his meals were provided. His father was the main breadwinner, and he understood his wages paid the bills and expenses. His father always worked.
Approximately a year after his father passed away, he obtained seasonal work with a mulesing contractor. He had only been able to obtain seasonal casual work, undertaking farm work and working with sheep. When he did not have work, he relied upon Centrelink benefits.
He did not have any qualifications, and his ability to read and write was minimal. His inability to drive and own a car affected his ability to obtain work.
The flat where he lived was owned by his aunt. He paid rent each week when he was able.
Following his father’s passing, he entered into a relationship, from which there were two children. He and his former partner had separated, and the children resided with their mother. He spent time with them every day, and financially supported them when he was able.

Evidence of the third respondent, Blake James McClenahan

Blake’s statement is dated 19 May 2023.
He was 18 years old.
Prior to his death, the worker assisted him both financially and non-financially.
After the worker’s death, his mother did not feel capable of adequately caring for him. He relocated to live with his grandmother, Barbara Powell, and in February 2022, moved out on his own.
The worker paid for his living expenses, such as rent, bills, and food. But for the worker’s passing, he anticipated he would have remained at home, and the worker would have continued to pay his living expenses. Since leaving “Nan’s” house, he had to pay his own living expenses.
The worker paid for his school supplies and medical expenses. Since his passing, he had to pay for them himself or go without such items.
He was not licensed to drive, nor did he own a vehicle with which to learn. His “nan” was also unlicensed, so was never able to teach him. He had no doubt that the worker would have taught him to drive, and he would by that stage have obtained his provisional licence. As he was not licensed, both his ability to visit others and the ease with which he was able to obtain employment had been negatively affected.
He would previously go on camping trips with the worker, about fortnightly. He could no longer go camping, as he did not own a car, was not licensed to drive somebody else’s car, and did not know anybody who would be willing to regularly accompany him. He would also struggle to pay the associated expenses.
The worker had assisted Jason to obtain employment. The worker had indicated he intended to assist him to obtain similar work when he was of employment age.
In March 2023, he had a son. But for his father’s death, he had no doubt he would have spent time with his grandchild and assisted in the time and financial expenses associated with raising a child.

Evidence of the fourth respondent, Bruce McClenahan

Bruce’s statement is dated 12 December 2023.
He was married to Barbara from 1973 until her passing in 2022 and had not re-partnered.
He and Barbara had four children, including the worker, and five grandchildren.
He was a tyre fitter by trade and retired in 2023.
From 1996 to about 2002, the worker and the applicant lived with him and Barbara. The worker did a lot of work around the house, such as handyman jobs and mowing the lawn.
The worker and the applicant left their home in 2002. Thereafter, the worker lived and worked independently. The worker assisted him and Barbara regularly between 2002 and his death, helping them move house, mowing their lawns, cutting firewood, and other odd jobs. They needed help as they got older and less mobile.
In about 2015, he and Barbara moved to South Australia for two years. When they returned to Warren, the worker and the applicant put them up for about six months. They did not pay rent.
Whenever the worker cut firewood for them, he would pay him, usually $60. The worker cut firewood for them every year between 2016-2017 and his death.
He paid for the worker’s funeral because the applicant did not have any money, and the worker was uninsured. He had not yet received anything back.
At the time of the worker’s death, he and Barbara relied on him to help with manual labour from time to time.

SUBMISSIONS

The parties have provided written submissions, so I will refer to them only briefly.

Applicant

The applicant accepted that the power to award interest was discretionary – Haidary v Wandella Pet Foods Pty Limited, Dynamix Pty Ltd and Burrangong Pet Foods Pty Ltd;[1] Kaur v Thales Underwater Systems Pty Ltd.[2]
[1] [2005] NSWWCCPD 9 (Haidary).
[2] [2011] NSWWCCPD 6 (Kaur).
The applicant submitted that a number of decisions have interpreted “duly made”, as it appears in s 109(2)(b) of the 1998 Act, as being the date when the claim was fully particularised – Kathryn Ann Kratz as executrix of the estate of the Late Owen Beddall v Qantas Airways Limited;[3] Shanika Cooper v G & W Mudge Concreting Pty Ltd & others.[4]
[3] [2020] NSWWCC 36 (Kratz).
[4] (WCC6411/18) (Cooper).
The applicant submitted that in claims pursuant to s 25 of the 1987 Act, the duly made date was when particulars of dependency had been provided to the insurer – Kaur.
The applicant noted that the matter had a lengthy history. The current proceedings were filed on 22 November 2023.
The applicant submitted that her affidavit sworn on 17 June 2019 provided full particulars of her claim for dependency; and her claim was duly made when it was served on the solicitors for the insurer on 20 June 2019.
The applicant submitted that the Commission should exercise its discretion to order interest on her share of the lump sum from 20 June 2019 to the date that the order for payment of the lump sum was made.
The applicant submitted that the delay in seeking an order from the Commission in relation to payment of the lump sum had arisen because of a failure to notify the claim to all possible dependents. She acknowledged this was not the fault of the insurer.
When considering the exercise of its discretion, the applicant submitted that the Commission should consider the following:
(a)     the insurer knew from the date the particulars of dependency were provided by the applicant that it would be paying a lump sum to the applicant;
(b)     the insurer had had access to the lump sum from the date the particulars were provided;
(c)     the applicant had not had the benefit of the payment during that period;
(d)     the lump sum payable to the dependents of a deceased worker had been indexed on a number of occasions from the date of death in this matter, and the dependents are not eligible to claim the increased indexed amount payable, and
(e)     the only compensation the dependents can receive for the delay in receiving the lump sum benefit is by way of interest from the date the claim was duly made.
The applicant referred to Delta Services Pty Ltd v BBV &Ors[5] and the cases discussed therein and relied on that decision.
[5] [2022] NSWPIC 649.
As regards the rate of interest, the applicant submitted that decisions in the Commission have set a rate of between 2% to 2.5% above the Reserve Bank (of Australia (RBA)) cash rate. The Commission has been guided by the Uniform Civil Procedure Rules 2005 (UCPR) with respect to the rate of interest, being the RBA cash rate plus 2%.
The applicant submitted that the rate of interest of between 2% to 2.5% above the RBA cash rate during the relevant period was reasonable.

Second respondent

The second respondent claimed interest on the lump sum death benefit, with any interest awarded to be payable upon each apportioned benefit as determined by the Commission.
The second respondent noted that the Commission had interpreted that a claim was “duly made” when it was fully particularised.
The second respondent submitted that the insurer had sufficient information to determine liability in or about November 2018; and noted liability was accepted on or about
13 November 2018.
The second respondent submitted that the insurer had sufficient particulars as to his dependency in the proceedings in Matter Number 2638 of 2019. At the time of the discontinuance of that matter, the insurer had sufficient particulars to identify potential dependents of the worker.
The second respondent submitted that, in accordance with the State Insurance Regulatory Authority Standard of Practice for Death Claims, the insurer should have undertaken its own proactive enquiries to identify and provide notice of a potential claim upon the lump sum death benefit with [sic] the parents of the worker.

The second respondent submitted that, by failing to undertake its own proactive enquiries, the insurer had had the benefit of the lump sum death benefit since 28 June 2019.
The second respondent submitted that the payment of interest is not a penalty but reflected the fact that the insurer had had the benefit of the funds for in excess of five years.
As regards the rate of interest, the second respondent submitted that interest should be payable at the rate that was consistent with recent decisions of the Commission, being the RBA cash rate plus 2.5%. Any interest awarded should be apportioned as determined by the Commission.

Third respondent

The third respondent submitted that, on 1 September 2023, prior to the commencement of these proceedings, he filed an Application in Respect of Death of a Worker, in Matter Number W6400 of 2023. This included a signed statement dated 19 May 2023, particularising his dependency. The Application in Matter Number W6400 of 2023 was served on the insurer on 4 September 2023.
The third respondent submitted that his claim was duly made on the date of filing the Application in Matter Number W6400 of 2023, that is 1 September 2023. If that submission were not accepted, he submitted the claim was duly made when the sealed Application was served on the insurer on 4 September 2023, and interest should run from that date.
The third respondent submitted that the Commission has a discretion in relation to the rate of interest, with recent decisions having set the rate between 2% to 2.5% above the RBA cash rate. He submitted the rate should be 2.5% above the RBA cash rate.

Fourth respondent

The fourth respondent sought interest on his apportioned lump sum benefit from the date that his dependency was particularised, that is 12 December 2023.
The fourth respondent submitted that s 109(2)(b) of the 1998 Act prohibited payment of interest until an application for compensation is “duly made”. The Commission had held that an application is duly made when it was fully particularised.
The fourth respondent submitted that an application for compensation was duly made on the date that particulars of his dependency were provided to the insurer.
The fourth respondent submitted that he was only informed of the proceedings, and his potential claim, via correspondence on 3 October 2023. He particularised his dependency via a Reply on 12 December 2023.
The fourth respondent submitted that the claim was duly made per s 109(2)(b) when he, being the last identified dependent, particularised his dependency. The claim was not fully particularised prior to this date.
The fourth respondent acknowledged that the Commission has a discretionary authority to award interest. He submitted that, noting the identified purpose of the award of interest in such cases, the Commission ought to exercise its discretion and award interest.
The fourth respondent submitted that the rate of interest ought to be at a rate of 2% to 2.5% above the RBA cash rate, consistent with the Commission’s typical practice and the guidance from the UCPR.

First respondent

The first respondent referred to the submissions made in support of the various claims for interest, including reference to the discretion provided to the Commission by s 109 of the 1998 Act.
The first respondent submitted that any exercise of the Commission’s discretion to award interest should take into account its protracted history. In particular, it should take into account the first respondent’s attempts to progress the matter, and the failure of the applicant, second respondent, and third respondent to do so expeditiously.
The first respondent adopted as its primary submission the fourth respondent’s submission that the claim was not duly made pursuant to s 109(2)(b) of the 1998 Act until the fourth respondent, being the last identified dependant, particularised his dependency. If interest is payable, this is the appropriate date from which interest should run for all parties.
The first respondent noted that the applicant, second respondent and third respondent sought that interest be payable from earlier dates, on which they submit their claims were duly made.
In particular, the applicant and second respondent submitted that interest on their portions of the claim ought be payable from June 2019, when evidence was filed by the applicant as part of the proceedings commenced by the first respondent. The first respondent submitted that it would be unfair, having regard to the circumstances, for interest to be payable from this time, noting the delays in the matter being progressed by the applicant, who was best placed to locate and involve the fourth respondent in the proceedings.
The first respondent referred to s 109(2)(b) [sic: s 109(2)(c)] of the 1998 Act. It submitted that, whilst it was not directly applicable, it should provide guidance as to how the Commission should exercise its discretion in this matter. The first respondent conceded that the earlier proceedings were not adjourned on the claimants’ application, and there have been three separate proceedings, but submitted the intent of the section is to preclude interest being payable when there is a lack of vigour on behalf of the claimants to progress their claims. That has been the case in the current proceedings.
If its primary submission is rejected, the first respondent submitted that interest should be payable on the whole lump sum from the date the Application was filed, being
17 November 2023. It was only at that point that the issues raised by Arbitrator Capel on
27 June 2019 were adequately addressed.
The first respondent noted the submissions in relation to the appropriate rate of interest. It did not argue with the proposition that an appropriate rate should be 2% above the RBA cash rate, in the event that interest is payable from either 17 November 2023, or
12 December 2023, being the date upon which the last identified dependant particularised his dependency.
The first respondent submitted that, if the Commission was minded to award interest from an earlier point in time on any portion of the lump sum, a lower rate of interest should be applied, to take into account the extraordinary circumstances of the case.

Reply

None of the claimants made any submissions in reply.

SUMMARY

Section 109 of the 1998 Act provides:
“(1) In any proceedings before the Commission, the Commission may order that there is to be included, in any sum to be paid, interest at such rate as the Commission thinks fit on the whole or any part of the sum for the whole or any part of the period before the sum is payable, subject to the limitations imposed by this section.
(2) Interest cannot be ordered under this section--
(a) on any compensation payable under Division 4 of Part 3 of the 1987 Act, or
(b) on any compensation payable under this Act for any period before a claim for the compensation was duly made, or
(c) on any compensation payable under this Act for any period during which proceedings before the Commission were adjourned on the application of the claimant for the compensation or pursuant to section 102.
(3) This section does not--
(a) authorise the giving of interest upon interest, or
(b) apply in relation to any debt upon which interest is payable as of right whether by virtue of any agreement or otherwise.”
The power to award interest is discretionary and may apply to some or all of the compensation payable, for the entire period, from the date of the claim to the date of the order, or for a lesser period. The rate of interest is also a discretionary matter. However, while the discretion is wide, regard must be held to the facts of the case.
In Haidary, Deputy President Fleming said:
“The award of interest by the Commission, pursuant to section 109 of the 1998 Act is discretionary. Mr Haidary will only be entitled to interest, if awarded, on those amounts of his weekly entitlement that were unpaid, and only from the date that his claim ‘was duly made’. The likely amount of interest that would be due on these sums is small, relative to the whole of his claim, but nonetheless they may form part of Mr Haidary’s entitlement. The purpose of ordering interest on an award is to compensate the worker for the loss of his or her income, not to penalise the employer (Virag v James N Kirby t/as Betts Electric Motors (1990) 6 NSWCCR; Healey v McPherson Binding Pty Ltd (1989) 5 NSWCCR 139).”
Section 109(2)(b) of the 1998 Act provides that interest cannot be ordered for any period before a claim was duly made.
President Keating said in Kaur:
“Section 109(2)(b) of the 1998 Act prohibits interest on any award of compensation payable under the Act for any period before a claim for compensation on behalf of the appellants was duly made. I accept the submission that the claim for compensation on behalf of the appellants was not duly made until the day of the arbitration. I therefore accept Thales’s submission that, as at the arbitration, the appellants could not be entitled to interest pursuant to s 109 of the 1998 Act.”
“Duly made” has been held to mean “fully particularised”. It was applied in Kratz, in which Arbitrator Isaksen, as he then was, referred to the decision of Arbitrator Wynyard, as he then was, in Cooper and his own decision in Lavelle v David Paul Browne & others.[6]
[6] WCC533/19.
The first respondent has adopted as its primary submission that of the fourth respondent that, if interest is to be awarded, then it should be awarded from the date on which the fourth respondent’s claim was “duly made”, as he was the last claimant to particularise his dependency.
I do not accept this submission. It is possible for claims by various claimants to be “duly made” at different times, as is the case in this matter. If it were the case that no dependent had an entitlement to interest until all potential dependents had particularised their claims, those who acted expeditiously may be unfairly penalised if there was a delay in identifying other potential dependants, or if those dependants delayed in providing evidence to support their claims.
As was held in Haidary, an award of interest is intended to compensate the worker, or in this case the dependents, not to punish the employer.
In Bennettv Jones[7] Moffitt P said (at 367):
"A number of questions arise. Is the power to award interest such that it should be used punitively, so a plaintiff or defendant is penalised for delay or failure to observe court procedures; or is it entirely compensatory, so as to do no more than that which is fair in a pecuniary sense between the parties? Is the jurisdiction to be exercised, or not exercised, simply by inquiry whether the defendant ought to have paid money to the plaintiff at some earlier date; or is it to be awarded on some more neutral basis, as that, for some reason, the money has been outstanding for a period, in which the defendant had the benefit of not paying it and the plaintiff the detriment of not having it, and that delay and the conduct of a party is relevant, only so far as by reason of it, there is, or may be, economic disadvantage to the opposing party by an award of interest being, or not being, made? For reasons I will indicate, in my view the approach last mentioned in each of the two foregoing queries is that which is in conformity with the statute.”
[7] [1977] 2 NSWLR 355 (Bennett).
His honour continued, at 370:
“I see no reason why the simple fact that a defendant does not have to pay money when his liability arises, and has the benefit of non-payment for a period, should not provide a basis to make a discretionary order for payment of interest for the whole period. One had the money, and the other not. If it is not a commercial setting, the gain and loss may not be measured by a commercial rate of interest.”
As Arbitrator Sweeney (as he then was) said in Beves v Patrick Stevedores No 2 Pty Ltd & Anor,[8] in a “death claim”, where the compensation has not been paid, the insurer/scheme agent has been in possession of the award monies, and the worker [sic] has been deprived of their use.
[8] [2014] NSWWCC 178 (Beves).
Arbitrator Sweeney noted that what had transpired in Beves was beyond the insurer’s control, but:
“Nevertheless, the insurer has had the compensation moneys throughout this period and presumably invested it to its advantage. To paraphrase Bennett, interest is not to be awarded simply on the basis that the respondent ought to have paid the money earlier, but on the more neutral basis that ‘the money has been outstanding for a period during which the defendant has had the benefit of not paying it, and the plaintiff the detriment of not having it’.”
I accept that the considerable delay in progressing this matter was in no way due to any lack of effort on the part of the first respondent to advance it. I reject the second respondent’s submissions that the first respondent had somehow failed in its “proactive” obligations. That is clearly not the case.
However, regardless of the steps taken by the insurer to progress or resolve the claim, the fact remains that, as Moffitt P said succinctly in Bennett, “One had the money, and the other not”. I believe the Commission should, therefore, exercise its discretion to award interest on the lump sum.
As Arbitrator Sweeney pointed out in Beves, the common law principles must be considered in the light of s 109 of the 1998 Act.
As regards the application of s 109(2)(c) of the 1998 Act, the first respondent has conceded that the matter was not adjourned on the application of any claimant. The subsection does not apply.

Applicant

I accept the submission by the applicant that her claim was “duly made” when her affidavit, sworn on 17 June 2019, was served on the respondent’s insurer on 20 June 2019.
I therefore determine that the applicant’s claim was duly made on 20 June 2019.

Second respondent

I do not accept the second respondent’s submission that the insurer had sufficient particulars of his dependency in Matter Number 2638 of 2019. His affidavit dated 18 June 2019 provided no particulars of his dependency on the worker. His claim was not “fully particularised”.
It was not until the second respondent made his statement dated 21 September 2023 that his claim was “duly made”. The statement was attached to his Reply in this matter, which is dated 11 December 2023. There is no evidence that it was served before that date, and no evidence as to when the Reply was served, but I will assume that the Reply was served on or about 11 December 2023.
I therefore determine that the second respondent’s claim was duly made on
11 December 2023.

Third respondent

The third respondent submitted that his claim was duly made either on 1 September 2023, when Matter Number W6400 of 2023, which attached his statement dated 19 May 2023, was lodged, or when his Application was served on the insurer on 4 September 2023. I accept that the latter date was the date on which the claim was duly made.
I therefore determine that the third respondent’s claim was duly made on 4 September 2023.

Fourth respondent

The fourth respondent submitted that his claim was duly made on 12 December 2023, when he particularised his claim. As his Reply is dated 13 December 2023, and there is no evidence that his statement was served on the first respondent or its insurer before that date, I accept that his claim was duly made on 13 December 2023.
I therefore determine that the fourth respondent’s claim was duly made on
13 December 2023.

Rate of interest

As the parties have submitted, the Commission has recently taken the approach that interest should be awarded on the lump sum death benefit at a rate of from 2% to 2.5% above the RBA cash rate. See, for example, Goulburn Flight Training Centre Pty Limited v Druck & Ors;[9] AFF Properties Pty Ltd v Robovich & Ors;[10] and BDU by next friend BKO & Ors v State of New South Wales (NSW Police Force) & Ors.[11]
[9] [2023] NSWPIC 35.
[10] [2023] NSWPIC 41.
[11] [2023] NSWPIC 208.
The first respondent did not take issue with an award of interest at 2% above the RBA cash rate.
In my view, the appropriate rate at which interest should be awarded is the rate that is 2% above the RBA cash rate at the relevant date, to be awarded to the applicant, the second respondent, the third respondent, and the fourth respondent, from the date on which he or she duly made the claim, and payable on the sum apportioned to each.
The claims were duly made on the following dates:
(a)    Applicant: 20 June 2019;
(b)    Second respondent: 11 December 2023;
(c)    Third respondent: 4 September 2023, and
(d)    Fourth respondent: 13 December 2023.
The orders are as set out in the Certificate of Determination.

[2024] NSWPIC 139

21 March 2024