Royal Society of Welfare for Mothers and Babies v Bowers

[2000] NSWCA 212

Reported Decision: 49 NSWLR 421

New South Wales

Court of Appeal

CITATION:	Royal Society of Welfare for Mothers and Babies v Bowers [2000] NSWCA 212
FILE NUMBER(S):	CA 40896/99
HEARING DATE(S):	22 June 2000
JUDGMENT DATE:	11 August 2000
PARTIES :	Royal Society of Welfare for Mothers and Babies v Michelle Mary Bowers
JUDGMENT OF:	Priestley JA at 1; Stein JA at 2; Clarke AJA at 3

LOWER COURT JURISDICTION :	Compensation Court
LOWER COURT FILE NUMBER(S) :	CC 33443/98
LOWER COURT JUDICIAL OFFICER :	Bishop J

COUNSEL:	Appellant - B. Ferrari Respondent - M. Bleasel
SOLICITORS:	Appellant - Firths Respondent - William K. Chambers
CATCHWORDS:	Workers Compensation Act s 52A, s 54 Schedule 6 cl 14 - Construction and application before and after 1998 amendments
LEGISLATION CITED:	Interpretation Act 1987 Workers Compensation Act 1987 WorkCover Legislation Amendment Act 1996 Workers Compensation Legislation Amendment Act 1998
CASES CITED:	Kur-Ring-Gai Municipal Council v Attorney-General for the State of New South Wales, unreported, CCNSW 24/1/00
DECISION:	Appeal allowed. To be remitted to Compensation Court for determination.

THE SUPREME COURT

OF NEW SOUTH WALES

COURT OF APPEAL

CA 40896/99
CC 33443/99

PRIESTLEY JA
STEIN JA
CLARKE AJA

Friday, 11 August 2000

ROYAL SOCIETY OF WELFARE FOR MOTHERS AND BABIES v BOWERS

WORKERS COMPENSATION ACT - SECTION 52A, SECTION 54, SCHEDULE 6, CLAUSE 14 - Construction and application before and after 1998 amendments.

Held : Clause 14(3)(b) is relevant only in cases where notices have been given under the 1996 version of s 52A.

ORDERS
1. Appeal allowed. Set aside the orders of Bishop J.
2. The respondent is to pay the appellant’s costs of the appeal and is to have a certificate under the Suitor’s Fund Act.
3. The proceedings are to be remitted to the Compensation Court for determination in accordance with the decision of this Court.

THE SUPREME COURT

OF NEW SOUTH WALES

COURT OF APPEAL

CA 40896/99
CC 33443/99

PRIESTLEY JA
STEIN JA
CLARKE AJA

Friday, 11 August 2000

ROYAL SOCIETY OF WELFARE FOR MOTHERS AND BABIES v BOWERS

1    PRIESTLEY JA: I agree with the clear trail blazed by Clarke AJA through the jungle of amendments to the Workers Compensation Act 1987 relevant to this appeal. I agree with his reasons and proposed orders. 2 STEIN JA: I agree with Clarke AJA. 3    CLARKE AJA: Michelle Mary Bowers (the worker) received a significant injury to her left leg in the course of her employment with the Royal Society of Welfare for Mothers and Babies (the employer) on the 31st of May 1991. Voluntary payments of compensation were made and on the 24th of April 1995 she was the recipient of a consent award for lump sum compensation under ss66 and 67. Following further surgery she filed an application for determination for additional lump sum payments. At about this time, for reasons which it is unnecessary to mention, the employer reduced voluntary payments of compensation to the single person rate. She thereupon amended her application for determination to claim additional weekly payments. 4 The proceedings came before Bishop J on the 15th of July 1999 and were concluded on the 19th of August 1999 when an award was entered in favour of the worker under s 40 on the basis of her partial incapacity and an adjustment was made of the lump sum payments. 5 Immediately following the delivery of the judgment the employer served a notice under s 54 of its intention to discontinue payments. The notice was dated the 16th of August 1999 and nominated as the last day of payment the 30th of September 1999. Because s52A, the section pursuant to which the notice was given, was a novel section and there were uncertainties as to the correct legal position, payments have not in fact stopped and they continue to this day. 6 Notwithstanding, the employer brought proceedings for a review of the award, which proceedings came before Judge Bishop on the 19th of August. In a reserved judgment given on the 3rd of November 1999 his Honour dismissed the application for a review. He did so on the basis that a preliminary notice, to which I will later make reference, had not been served upon the worker in circumstances where service of such a notice was a condition precedent to the right to serve a notice discontinuing payments. The employer has appealed and challenges that conclusion. 7 The point which is raised in this appeal requires some detailed reference to the Workers Compensation Act 1987 (the Act), and amendments made to it in 1996 (1996 amendments) and 1998 (1998 amendments). There is much detail in the relevant statutory provisions and I do not think it would be helpful to set them out in their entirety. Rather I propose to set out short excerpts and refer to them in a way which may be more helpful in gaining an understanding of the thrust of this judgment. 8 The 1996 amendments introduced s52A into the Act thereby affording to an employer a right to discontinue weekly payments of compensation made in respect of partial incapacity after payments had been made for two years. Subsection 1 reads:

“Weekly payments of compensation in respect of incapacity for work are not payable for any period beyond the first 104 weeks of incapacity for work (whether total or partial or a combination of both) in respect of which the worker has received or is entitled to receive weekly payments of compensation but only if one or more of the following paragraphs applies to the worker.”

9 The following paragraphs set out the conditions which needed to be satisfied which, broadly, required that the worker be partially incapacitated for work and was not in suitable alternative employment. This is a generalisation which is not strictly accurate in all respects but it conveys the tenor of the provisions. 10 Further the section provided, as a condition precedent to the right to discontinue payments, that the employer must give the worker at least twelve weeks notice - described as “a payment discontinuation notice” - of the employer’s intention to discontinue the payments. There were a number of other subsections to which it will later be necessary to make reference but for the present I can put them to one side. 11 At the same time there was also introduced into Schedule 6 Part 4 of the Act a new cl 14. That clause sets out the classification of case to which s52A applied. In subs 1 it provided that the section applied to compensation payable in respect of an injury received after the commencement of that section (i.e. 12th January 1997). Subsection 2 is of significant importance in this appeal and I will set out subcls (a) and (b) of that subsection.

“2. Section 52A extends to the compensation payable in respect of an injury received before that commencement (but after the commencement of this Act - i.e., 30th of April 1987) subject to the following:
(a) A payment discontinuation notice must not be given until the person liable to make the weekly payments has given the worker a notice (“a preliminary notice”) informing the worker about the existence and the effect of s 52A and alerting the worker to the possible application of that section to the worker.
(b) The earliest that a preliminary notice can be given to the worker is when the worker would still have to receive at least 52 weeks of weekly payments of compensation in order to bring the total number of weeks of weekly payments received by the worker (both before and after that commencement) to 104 (even if this would result in the worker receiving the payments for more than a104 weeks).”

12 The scheme of cl 14 appeared to be simple. Section 52A applied without qualification where the relevant injury was received by the worker after the 12th of January 1997. Where the relevant injury was received prior to that date the section applied in more limited circumstances and only where the preliminary notice had been given (again this does not state the full effect of cl 14 but is sufficient explanation for the purpose of understanding the reasoning that follows). 13 Section 52A survived in that form only for about 18 months. The Act was amended in 1998 and s 52A was omitted and a new section inserted in the Act together with a new clause, cl 15, in Schedule 6 Part 4. 14 Although the main part of subs1 of the new section was similar to the omitted section the combined effect of the new provision and the new clause was quite different in effect to the earlier provisions. Section 52A following the 1998 amendments read, so far as is presently relevant:

“Weekly payments of compensation in respect of partial incapacity for work are not payable for any period beyond the first 104 weeks of partial incapacity for work (whether or not any part of that period is compensated as if the incapacity for work was total) but only if one or more of the following paragraphs (referred to in this section as grounds for discontinuation) applies to the worker at the relevant time.”

There followed three grounds for discontinuation similar to but different in detail from the earlier conditions. Subsection 2 defined the relevant time at which the grounds for discontinuation must exist and stated that a discontinuation of payments under s 52A had effect even if the grounds for discontinuation ceased to apply to the worker after the relevant time.

15    Clause 15 is short and can be set out in full.

“1. The amendments to s 52A made by the Workers Compensation Legislation Amendment Act 1998 apply to the discontinuation of payments of weekly compensation after the commencement of that amendments, whether the incapacity results from an injury received before or after that commencement and whether all or any part of the 104 weeks of incapacity for work referred to in that section occurred before that commencement.
2. This clause is subject to the Regulations under Part 20 of this Schedule and the Regulations under the 1998 Act.”

(We were advised that there were no relevant regulations).

16 The question which arose before Judge Bishop was whether cl 14 continued to apply following the 1998 amendments in all cases where the injury from which the incapacity resulted was received prior to the 12th of January 1997. 17 Judge Bishop reasoned that cl 14 conferred two significant rights upon workers. The first was the right to receive preliminary notice and the second, which appears in cl 14(3), excluded workers who are receiving weekly payments under a court award or where there were identified pending proceedings from the provisions of s 52A. His Honour was unable to find anything in the 1998 amending Act, or the transitional provisions, which demonstrated an intention that those rights should be abrogated as a result of the insertion of the new form of s 52A. In particular he could find no evidence of an intention to expose those workers who were receiving weekly payments of compensation under a court award to the privative provisions of s 52A. 18 The employer’s argument is succinctly expressed in clauses 10 to 13 of its written submissions which read:

“10. It is submitted that Schedule 6 Part 4 Clause 14 relates only to s 52A as inserted by the 1996 amendment and has no application to s 52 A in the form it was inserted in 1998. In this regard clause 14 was impliedly repealed by the Workers Compensation Legislation Amendment Act 1998 (i.e. the 1998 amendments).
11. The new form of s52A entirely replaced the old form. It is submitted that clause 14 applies only in circumstances where the old form of s 52A had been invoked. In support of this argument are the words of the clause itself. Clause 14(1) refers to s52A “as inserted by the WorkCover Legislation Amendment Act 1996” (i.e. the 1996 amendments).
12. The appellant submits that the new form of s 52A is designed to cover injuries occurring before its commencement. There were less than 104 weeks between the commencement of the 1996 section and the 1998 amendments. Thus clause 14 has only been left in the Act for the situation where a discontinuation notice had been given under the old s 52A.
13. Therefore it would not have been intended by the legislature that Schedule 6, Part 4 clause 14 should apply to a notice of discontinuance of payments served pursuant to the new form of s 52A.”

19 The Act is a complex piece of legislation which has been much amended. The consequence is that the interpretation of its provisions and amendments is often attended with great difficulty. The present case is but one example of the difficulties which can arise. Notwithstanding I have come to the conclusion that his Honour erred and that cl 14 which, of course, remains in the Act, applies only to those cases in which a notice, or notices, had been given under the 1996 form of s 52A. I will now go on to explain my reasons for that conclusion. 20 The form of cl 14 is an indication that it was to apply only in respect of s52A in the form in which it was introduced into the Act in 1996. The words “as inserted by the WorkCover Legislation Amendment Act 1996” were, presumably, not surplusage. The introduction of those words into a section, which itself was new in the Act, is difficult to understand. Nonetheless the words are there and, particularly having regard to the word “as” provide an indication that it was only s 52A in its form following the 1996 amendment which was to be qualified by cl 14. 21 Secondly cl 15 is specifically concerned with the form of section after the 1998 amendments. So much appears from the introductory words of cl 14. It will be recalled that cl 15(1) opens “The amendments to s 52A made by the Workers Compensation legislation Amendment Act 1998”. 22 The opening words of both clauses strongly indicate a simple scheme. Clause 14 applies to s 52A as it was after its introduction in 1996 and cl 15 applies to the section as it was following its amendment in 1998. 23 Thirdly cl 15 proceeds upon the basis that the date of injury is irrelevant to the application of s 52A (as amended in 1998). It applies in respect of all discontinuations (this must mean all cases in which a notice is given and payments discontinued after 1 August 1998) which occurred after the 1st of August 1998, no matter whether the injury occurred before or after that date. There is nothing in either cl 14 or cl 15 which supports the view that limitations appearing in cl 14 apply to s 52A after it was amended in 1998. 24 Fourthly, cl 14 was expressed to apply in respect of injuries received after the commencement of s 52A (as inserted by the WorkCover Legislation Amendment Act 1996). That is injuries received after 12th of January 1997. Presumably his Honour’s view was that, notwithstanding that s 52A in that form had been omitted from the Act, there remained a dichotomy between injuries received before that date and those received after it. This view could be accommodated if the commencing words of cl 14(1) are understood as meaning “… s 52A (as inserted by the WorkCover Legislation Amendment Act 1996) and notwithstanding any later amendment” so that the words “commencement of the section” later in the clause are understood to relate to the first introduction of the section into the Act and to apply to the section no matter that the 1996 form was later omitted. However it seems to me that the more sensible approach is that s52A as it was when inserted in 1996 was subject to the restrictions of cl 14 and once that section was omitted and replaced by a new s 52A the restrictions no longer applied. 25 Fifthly there are discordances between s 52A in the form following the 1998 amendments and cl 14 itself. The most important of these are as follows: 26 (a) Clause 14(2)(d) stipulates that the earliest time a payment discontinuation notice under s 52A(3) can be given is at least 12 weeks before the end of the 104 week period referred to in s 52A.

This is perfectly comprehensible in the context of the 1996 amendment in which s 52A(3) dealt with a payment discontinuation notice. However the 1998 version of s 52A(3) deals with an entirely different subject matter. Accordingly cl 14(2)(d) makes no sense if applied to the 1998 version of s 52A.

Furthermore the new section makes no reference to payment discontinuation notices but refers in s 52A(4) to a s 54 notice of intention to discontinue payments. More importantly, that subsection permits the giving of a notice six weeks before the end of the 104 week period. Not only is this inconsistent with the 12 weeks required in cl 14(2)(d), but it is difficult to understand how that clause could qualify the clearly expressed condition in s 52A(4).

27 (b) Section 52A (as it was following its introduction) and cl 14 operated in a complementary fashion. Where in cl 14 it was said that, subject to the exceptions set out, s 52A applied only in respect of compensation payable in respect of any injury received after the commencement of s 52A it was clear that the reference was to an injury received after the 12th of January 1997. It has been submitted that the effect of the 1998 amendments is that the exception provisions in cl 14 apply to the new version of s 52A but, presumably in reliance upon the words in parenthesis, continued to apply only in respect of injuries which occurred before the 12th of January 1997. However once the 1996 version of s 52A was omitted from the Act it becomes difficult to see how cl 14 could have the ambulatory effect for which the respondent argues. Reading the words in parenthesis in the context of the whole clause leads to the conclusion that the more reasonable interpretation is that cl 14 applied only to the 1996 version of s 52A and was retained in the Act to protect persons who had exercised rights under that provision. 28 (c) Possibly the clearest indication that cl 14 could not apply to the 1998 version of s 52A is to be found in subs 8(b). That subsection reads:

“8. If:
(a) …
(b) Proceedings before the Compensation Court involve a claim for weekly payments of compensation in respect of any period of incapacity for work that includes any period beyond the end of the 104 week period, the notice under s 54 may (but need not) be given before payments are discontinued. …”

29 Here there is a clear recognition that a notice under s 54 may be given in respect of payments despite the fact that there are pending proceedings before the Compensation Court. That subsection is clearly inconsistent with cl 14(3)(b) which reads:

“3. Section 52A does not apply in any of the following cases:
(a) …
(b) a case where court proceedings in which the worker is claiming weekly payments of compensation for which the employer or insurer has denied liability … are pending as at the commencement of that section. “

30 The two cannot stand together unless the subclause is understood as referring only to the omitted version of s 52A. Clause 14(3)(b) must now be taken to be no longer relevant (except in cases where notices were given under the 1996 version of s 52A). Further, as Judge Burke pointed out in Sippel v Carey’s (Tamworth) Pty Ltd Unreported, Compensation Court of NSW, 24 January 2000. other changes to the Act obviated any need for special provision for s 51 applications such as appear in clause 14 (3)(c). 31 Judge Bishop referred to s 30(1)(c) of the Interpretation Act 1987 in the context of accrued or acquired rights. But as there are clear indications in the 1998 amendment that the section is to apply to events that occurred before its introduction into the Act the principle relating to accrued rights on which Judge Bishop relied cannot assist the respondent. See Ku-Ring-Gai Municipal Council v Attorney-General for the State of New South Wales (1957) 99 CLR 251 at page 265. Dixon CJ, McTiernan and Taylor JJ said:

“Although in cases of amendment the retrospectivity of the amending provision is often discussed without express reference to s 8(b) (the 1897 equivalent of the present section 31(c)) or analogous enactments. It seems to us that it applies as much to a repeal to make way for a substitutional provision as to a simple repeal. If there is any manifestation of an intention in the amending enactment that the amendment should apply to rights etc arising from events that have already occurred then the application of s8(b) will be negatived. But, if not, the rights so arising are supported and continued by that paragraph of s 8.”

32 Judge Bishop took the view that the rights which I earlier mentioned accrued under s 52A (1996) whether or not any reliance had been placed on them and notices given. This is a view with which I have some difficulty but, even if one assumes the correctness of that statement, it seems to me that there is a clear manifestation of an intention that the amendment should apply, unqualified by cl 14, to all cases no matter when the injury occurred. The only possible exceptions are those arising where steps had been taken in reliance upon the 1996 legislation. 33 In my opinion the appeal should be allowed. 34 The following orders should be made:

1. Appeal allowed. Set aside the orders of Bishop J.
2. The respondent is to pay the appellant’s costs of the appeal and is to have a certificate under the Suitor’s Fund Act.
3. The proceedings are to be remitted to the Compensation Court for determination in accordance with the decision of this Court.

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