Super IP Pty Limited v Mijatovic

[2016] NSWWCCPD 33

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:	Super IP Pty Limited v Mijatovic [2016] NSWWCCPD 33
APPELLANT:	Super IP Pty Limited
RESPONDENT:	Marina Mijatovic
INSURER:	Employers Mutual NSW Ltd
FILE NUMBER:	A1-5655/15
ARBITRATOR:	Mr J Harris
DATE OF ARBITRATOR’S DECISION:	18 February 2016
DATE OF APPEAL DECISION:	28 June 2016
SUBJECT MATTER OF DECISION:	Psychological injury; employment dispute and alleged unlawful discrimination; complaint to Australian Human Rights Commission discontinued upon execution of deed of release; whether the worker recovered damages; ss 149 and 151A of the Workers Compensation Act 1987; meaning of monetary compensation
PRESIDENTIAL MEMBER:	President Judge Keating
HEARING:	On the papers
REPRESENTATION:	Appellant:	Edwards Michael Powell Lawyers
Respondent:	Marshall & Gibson Lawyers
ORDERS MADE ON APPEAL:	1.       The Arbitrator’s determination of 18 February 2016 is revoked and, in its place, the following order is made:                   “1. Award for the respondent.”

INTRODUCTION

1. The worker suffered a psychological injury which she claimed was due to bullying and harassment in the course of her employment. She lodged a complaint with the Australian Human Rights Commission. The complaint was resolved on payment of $8,700 and the execution of a Deed of Release. The deed purported to exempt workers compensation benefits from the releases it secured.

2. The worker subsequently brought a claim for permanent impairment compensation in respect of the psychological injury. The issue on appeal is whether the payment made pursuant to the deed constituted damages in respect of the same injury, such that the worker was precluded by the operation of s 151A of the Workers Compensation Act 1987 (the 1987 Act) from any further entitlement to compensation.

BACKGROUND

1. From 2008, the respondent worker, Ms Marina Mijatovic, worked for the appellant employer, Super IP Pty Ltd as a contractor. Her main duties involved testing software and analysing reports. Following 6 March 2012, she commenced a period of certified sick leave due to a psychological injury and did not return to work.

2. It is not disputed that Ms Mijatovic sustained the psychological injury in the course of her employment with the appellant. There were three specific events giving rise to the injury. Firstly, the conduct of Ms Mijatovic’s supervisor towards her in dealing with her performance issues in early 2012. Secondly, a meeting on 6 March 2012 where the employer advised Ms Mijatovic that her flexible working from home arrangements would no longer be available. Thirdly, the employer’s decision to decline Ms Mijatovic’s request for a pay rise and a variation to her role.

3. Following the meeting, on 6 March 2012, Ms Mijatovic experienced symptoms of anxiety. In her statement, Ms Mijatovic describes that she experienced difficulty breathing and that it felt like her heart was going to come out of her chest. She had a panic attack and collapsed on the floor of the appellant’s bathroom. A paramedic attended and he helped Ms Mijatovic with her breathing. She was given an injection and some medication. Following this incident, on the same day, Ms Mijatovic completed an “EML Web Initial Injury Notification Form” via “Web Services”, which I infer to be a notification of injury to the appellant’s insurer, Employers Mutual NSW Ltd (Employers Mutual). In that notification form, Ms Mijatovic records that she was injured on 6 March 2012 as a result of a “panic attack/collapse on floor”.

4. On 27 March 2012, Ms Mijatovic made a claim for compensation. She recorded that she had a “fall in bathroom” and that she experienced a headache, breathing problems, numb legs, nausea and chest pains. She recorded “Doctor diagnosis of Anxiety” and notes that she was referred to a psychiatrist. That claim was declined on or about 30 April 2012 on the basis that her condition was due to reasonable action taken by the employer (s 11A of the 1987 Act).

5. Also on 27 March 2012, Ms Mijatovic made a complaint against the employer to the Australian Human Rights Commission. She alleged, amongst other things, discrimination on the basis of sex, pregnancy, family responsibilities, disability, and sexual harassment, by the employer and certain specified employees. She alleged that certain actions by the employer and the specified employees caused her to suffer the psychological injury.

6. On 12 September 2012, the parties entered into a settlement and a Deed of Release (the deed) was executed. The deed, which is extracted and discussed below, provided for the employer to pay Ms Mijatovic the amount of $8,700 as a commercial settlement. This amount was paid to Ms Mijatovic and accepted.   

7. On 15 January 2013, Ms Mijatovic commenced proceedings in the Commission seeking weekly payments of compensation and medical expenses for the psychological injury arising from the nature and conditions of her employment with the appellant. On 7 March 2014, Employers Mutual issued a s 74 notice. It declined liability for a range of reasons most of which are not currently relevant. However, relevantly, the defences included a claim that Ms Mijatovic had extinguished her rights to compensation because pursuant to the deed she had received “damages” within the meaning of s 151A(1) of the 1987 Act.

8. Notwithstanding the s 151A(1) defence, the claim was resolved and on 10 April 2014, the Commission issued a Certificate of Determination – Consent Orders which provided the payment of s 60 medical expenses up to $6,000 and an award for the employer in respect of the claim for weekly payments of compensation.

9. On 19 January 2015, Ms Mijatovic made a further claim for compensation based on the same injury that is referred to above at [6]. On this occasion she claimed permanent impairment compensation in respect of the psychological injury deemed to have occurred on 6 March 2012. Ms Mijatovic relied on the report of Dr Christopher Canaris, consultant psychiatrist, dated 10 December 2014 in support of her claim. In that report Dr Canaris recorded a history of a number of workplace stressors. These included inappropriate comments regarding her work performance, being shouted at by her superior, disputes regarding her remuneration and flexible working arrangements. These issues came to a head at a meeting in March 2012. At that meeting Ms Mijatovic broke down. She was distraught, nauseated, crying and hyperventilating. An ambulance was called but she declined to be transported to hospital. Dr Canaris concluded that Ms Mijatovic suffered a severe and chronic major depressive disorder which “comes on in the setting of major workplace stressors”.

10. On 24 March 2015, Employers Mutual issued a second s 74 notice declining the claim. It again relied, among other things, on a defence under s 151A.

11. On 2 October 2015, Ms Mijatovic’s legal representatives filed an Application to Resolve a Dispute (the Application), on her behalf, claiming lump sum compensation for permanent impairment compensation for a psychological injury. Ms Mijatovic claimed that she suffered a psychological injury as a result of bullying and harassment experienced during the course of her employment between January 2011 and 6 March 2012. She added that the nature and conditions of employment exposed her to an excessive workload between January 2011 and 6 March 2012 causing and/or contributing to her psychological injury.

12. On 25 November 2015, the employer filed a reply, attached to an Application to Admit Late Documents, relying on its s 74 notices disputing liability. 

13. The matter came before a Commission Arbitrator for Conciliation/Arbitration proceedings on three separate occasions, before a determination was made. In proceedings on 4 February 2016, the Arbitrator interpreted the deed and found that the payment of $8,700 did not constitute damages within the meaning of s 151A(1). His reasons for doing so are discussed below. He found that Ms Mijatovic was not precluded from pursuing her claim for lump sum compensation.

14. On 9 February 2016, the Arbitrator delivered an extempore decision in favour of the worker. However, due to technical difficulties a sound recording of the extempore decision was not available and the Arbitrator determined that it was necessary that he provide written reasons for his decision. Accordingly, on 18 February 2016, the Arbitrator issued a Certificate of Determination containing a statement of reasons for his decision. The Certificate of Determination is in the following terms:

    “The Commission determines:

    1. I find that the applicant sustained psychological injury within the meaning of sections 4 and 9A of the Workers Compensation Act 1987 caused by:

    (a)January 2012 event involving George Janczuk;

    (b)January/February 2012 involving the comment from Mr Rajarshi Ray, and

    (c)The meeting on 6 March 2012.

    2.       A copy of these orders is to be sent to the Registrar for forwarding to the Approved Medical Specialist.

    3.       The Approved Medical Specialist is requested not to provide the Medical Assessment Certificate until the expiry of 30 days, or in the event that an appeal is filed, upon the finalisation of any appeal.”

15. The employer appeals the Arbitrator’s determination. The issues on appeal are limited to the Arbitrator’s finding in relation to whether Ms Mijatovic recovered damages which precluded her from pursuing her claim for permanent impairment compensation.

ON THE PAPERS

1. Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (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.”

2. Having regard to Practice Directions Nos 1 and 6; the documents that are before me, and the submissions 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.

TIME

1. Ms Mijatovic submits that the appeal was not lodged within 28 days of the Certificate of Determination being issued. She submits that the Certificate of Determination was issued on 17 February 2016 and attached a copy of an unsigned and unsealed Certificate of Determination dated 17 February 2016 to her Notice of Opposition to Appeal Against Decision of Arbitrator. Ms Mijatovic submits that as the appeal was lodged on 18 March 2016, pursuant to s 352(4) of the 1998 Act, it was lodged out of time.

2. I do not accept Ms Mijatovic’s submissions for the following reasons. The Certificate of Determination to which Ms Mijatovic refers is unsigned and unsealed. All of the Commission’s records indicate that the Certificate of Determination was issued on 18 February 2016. The Commission’s letter to the parties enclosing the Certificate of Determination is dated 18 February 2016 and the signed and sealed Certificate of Determination is dated 18 February 2016. Why Ms Mijatovic received a Certificate of Determination dated 17 February 2016 is unexplained. It follows that the Certificate of Determination was issued on 18 February 2016.

3. Accordingly, the last day to lodge the appeal within the 28-day period allowed by s 352(4) was on 17 March 2016. Contrary to Ms Mijatovic’s submissions the appeal was lodged on 17 March 2016 and therefore was lodged within time.  

4. If I am wrong and the Certificate of Determination was issued on 17 February 2016, then the appeal would have been filed one day out of time. Having considered the nature of the litigation and the fact that the appeal raises only a legal question, I am satisfied that it is desirable for the proper and effective determination of the dispute that leave be granted to extend the time for lodging the appeal by one day (Gallo v Dawson [1990] HCA 30; 93 ALR 479 at 480).

THE EVIDENCE

1. I have extracted below the relevant passages from the Deed of Release dated 12 September 2012.

   DEED OF RELEASE“

   …

   RECITALS

   A.      The Employee commenced working for the Employer in early 2008 as a contractor. The Employer subsequently employed the Employee pursuant to a[n] employment contract dated 9 September 2008 as a full time Quality Assurance Analyst, principally as a testing resource (‘Employment’).

   B.      After a period of maternity leave in 2010, the Employee returned to work on a part time flexible working arrangement – working from home and from the office. This arrangement was varied in June 2011.

   C.      In early 2012 issues relating to the Employee’s performance were raised with the Employee by the Employer. The Employee also made a complaint to the CEO in relation to a supervising employee’s conduct towards her in dealing with the performance issues.

   D.      In March 2012 the Employee requested a pay rise and a variation to her role. Both were declined by the Employer for business and operational reasons.

   E.      As a result of operational issues and reorganisation by the Employer, the Employee was informed in a meeting on 6 March 2012 that her flexible working from home arrangements were no longer able to be sustained by the business and that the Employer was providing her with the [sic] more than the requisite period of notice to allow her to make alternative care arrangements for her child. The Employer also offered to discuss flexible start and finish times and discuss the issues further to assist her with childcare. The Employer’s decision was confirmed in a letter to the Employee dated 12 March 2012 (‘Flexible Working Decision’).

   F.      The Employee disagreed with and challenged the Employer[’]s Flexible Working Decision. The Employee alleged that the Employer was being unfair, was unlawfully discriminating against her and that the Employer’s reason for making the Flexible Working Decision was because she had made a request for a pay rise and variation to her role (‘Allegations’).

   G.      The Employer denies the Allegations.

   H.      After the meeting the Employee required medical assistance for anxiety symptoms and a related fall. The Employee received medical treatment from emergency services and then commenced a period of certified sick leave. Since this date, the Employee has not been performing work by reason of illness.

   I.       On 27 March 2012 the Employee made a workers compensation claim (Claim no. 227613016). On or about 30 April 2012, the Employee’s workers compensation claim was denied on the basis of reasonable action taken by the Employer. The Employee has disputed the denial of the claim and expressed an interest in lodging an appeal (‘Workers Compensation Claim’).

   J.       On 27 March 2012 the Employee also made a Complaint against the Employer to the Australian Human Rights Commission alleging among other things, sex, pregnancy and family responsibilities discrimination, sexual harassment and disability discrimination by the Employer and by certain named individual employees. The Employer denies the Complaint and all allegations contained therein (‘Complaint’).

   K.      As part of the Complaint, the Employee alleged that certain actions by the Employer and certain employees had caused her to suffer psychological and personal injury as a result of her perception of alleged workplace bullying and victimisation as set out in the Complaint. The Employee provided a psychologist’s report dated 20 June 2012 (‘Personal Injury Claim’).

   L.      The Employer denies the Personal Injury Claim. The Employer also denies that it has in any way acted unlawfully in relation to the Employee or that it has any liability to the Employee.

   M.     The Parties have, without any admission of liability, agreed to resolve all matters arising from or in relation to the Employment, the termination of the Employment and the Complaint, on the terms and conditions set out in this Deed.

   AGREED TERMS

   1.      TERMINATION OF EMPLOYMENT

   1.1The Employee’s Employment terminated by mutual agreement on 10 August 2012 (‘Termination Date’).

   2.      PAYMENT

   2.1Subject to the Employee complying with her obligations as set out in this Deed, the Employer agrees to pay to the Employee, by electronic funds transfer, within 14 days of receiving a copy of this Deed duly executed by the Employee, a gross amount of $8,700.00 as a commercial settlement in respect of the Personal Injury Claim (‘Settlement Payment’).

   2.2The Employer is making the Settlement Payment as set out in clause 2.1 above without any deduction of tax pursuant to the relevant taxation laws and the Australian Taxation office regulations however, no representation or warranty is made by the Employer in relation to the Employee[’]s tax liability.

   2.3 If the Australian Taxation Office or other regulatory body deems or determines that there is any tax liability in relation to the Settlement Payment, the Employee agrees to:

   (a) be responsible for any payments and indemnify, and keep indemnified the Employer and its related and associated bodies corporate, now or in the future, from any claim or demands made by the Australian Taxation Office or other regulatory body against the Employer and/or any of its related and associated bodies corporate in respect of the payment of any tax, compensation, damages, penalty charge, costs (including legal costs) interest and/or any other liability arising from the payment of the Settlement Payment due under this deed (other than for the avoidance of doubt, any tax withheld by the Employer in paying the sum to the Employee); and

   (b)to pay the Employer within seven days of the Employer making a demand in writing in respect of the indemnity in any of [the] circumstances set out in sub-paragraph (a) above.

   3.      OBLIGATIONS OF THE EMPLOYEE

   The Employee agrees to:

3.1 within 24 hours of the Employer making the Settlement Payment, do all things necessary and take all steps required to withdraw the Complaint and all allegations as against the Employer and all named individuals contained in the Complaint, and discontinue the Complaint;

3.2 bear her own legal and other costs arising from or relating to the Complaint and this Deed and any other related matters;

3.3 not make any adverse statement publicly or otherwise about the Employer or any of the Released Persons (unless compelled to do so by law); and

3.4 Return to the Employer by delivering to the Employer’s solicitors, M+K Lawyers, Level 21, 20 Bond Street Sydney, NSW, all confidential information and Employer property including but not limited to a laptop, computer and access pass.

4.      RELEASE

Subject to this Deed as and from the Termination Date, the Employee hereby releases, indemnifies and forever discharges and covenants not to sue the Employer and each and any of the Released Persons or any of them in respect of all causes of action, suits, claims, demands, cost and other liabilities of any nature, howsoever arising, which the Employee now or at any time may have, or but for the execution of this Deed, could have had against the Employer and each of the Released Persons or any of them directly or indirectly arising out of or in connection with:

(a)the circumstances set out in the Recitals;

(b)the Employment or the termination of the Employment;

(c)the Flexible Working Decision;

(d)the Allegations;

(e)the Complaint; and/or

(f)the Personal Injury Claim,

except any claims made in accordance with the provision of any applicable workers compensation legislation.

5.      DISCONTINUANCE AND NO FURTHER CLAIMS

5.1 The Employee agrees not to directly or indirectly make any further claims or take any other steps in relation to:

(a)the Complaint;

(b)her Employment with the Employer or the termination thereof;

(c)the subject matter of the Complaint and Personal Injury Claim; and/or

(d)the circumstances set out in the Recitals,

5.2 The Employee will not:

(a)encourage, procure or assist any other person to make any claim against the Employer or the Released Persons; or

(b)participate in any claim against the Employer or any of the Released Persons.

…

10.    FULL AND FINAL SETTLEMENT

The Employee agrees that the provision of this Settlement Payment is in full and final settlement of all claims, suits, demands, liabilities, costs or causes of action, howsoever arising, whether current or future, arising out of or in any way connected to, concerning or related to the circumstances set out in the Recitals, the Employment, the termination of Employment or the Complaint.

11.    BINDING EFFECT OF THIS DEED

11.1 This Deed shall bind the parties and any of their successors and heirs and any executor, administrator, transferee, assignee, liquidator or trustee in bankruptcy appointed in respect thereof.

11.2 The releases given to the Released Persons not a party to this Deed and the obligations created by this Clause 11 are intended to be, and are directly enforceable by and against each of those Released Persons and this Deed operates as a deed poll in favour of those Released Persons.

12.    BENEFIT OF DEED AND BAR TO PROCEEDINGS

The Employer holds the benefit of the release by the Employee in favour of the Released Persons. This Deed may be pleaded as a full and complete defence by any party to this Deed or by any of the Released Persons to any actions, suits or proceedings commenced, continued or taken by any other party or on any other party’s behalf in connection with any of the matters referred to in this Deed.

…

14.    ACKNOWLEDGEMENTS

The Employee acknowledges that:

14.1 in discontinuing the Complaint she withdraws the Complaint and all allegations contained in the Complaint as against the Employer and the individuals named in the Complaint;

14.2 agreement by the Employer to pay the Settlement Payment with respect to her Personal Injury Claim is not an admission of liability by or on behalf of any of the Released Persons;

14.3 the Employee has ongoing confidentiality obligations arising from the Employment which continue to apply; and

14.4 The Employee has entered into this Deed freely and voluntarily understanding and accepting:

(a) the consequences of the Employee doing so including the effect of the termination of employment; and

(b) the Employee’s rights and obligations as a result of entering into this Deed; and

(c) that the Employer and the Released Persons are relying on these acknowledgements.

…

17.    ENTIRE AGREEMENT

Subject to these terms, this Deed constitutes the entire agreement of the parties relating to the subject matter of the Deed and supersedes all prior understandings, negotiations, agreements, written or oral, express or implied, in relation thereto. This Deed can only be modified or amended in writing and upon mutual consent of the parties.”

SUBMISSIONS BEFORE THE ARBITRATOR

1. Counsel for the appellant, Mr Halligan, submitted that the terms of the deed were “on all fours” with the deed of release relied on in Adams v Fletcher International Exports Pty Ltd [2008] NSWCA 238 (Adams). He submitted that in Adams monies paid pursuant to a deed of release precluded the worker from pursuing a claim for further statutory benefits.

2. Mr Halligan submitted that although the deed does not refer in terms to “damages” the payment made pursuant to the deed comes within the definition of “damages” in s 149 of the 1987 Act. He submitted that s 149 defines damages to include “any form of monetary compensation” but does not include compensation payable pursuant to the 1987 Act. Therefore, so it was submitted, the fact that the deed seeks to exclude statutory compensation benefits from the releases contained in the deed has no effect on the definition of damages for the purposes of construing the deed.

3. Mr Halligan also submitted (at T28.31–29.7):

   “Well all I’m saying about the deed is that my argument, if there is an argument - there may not be an argument - but if there was an argument to suggest that because compensation has been left out of the provisions of the deed and the $8,700, it has no effect on the damages provisions as understood under the deed. In other words, we’ve got damages payable and paid under the deed therefore the worker is excluded from prosecuting this claim by reason of section 151A, and the fact that statutory compensation has been left out of the equation is of no moment.”

4. Mr Halligan further submitted that in so far as the release relates to workers compensation, it is in respect of prior payments of workers compensation. This is consistent with s 149 in that statutory compensation payments are excluded from the definition of damages.

5. The Arbitrator did not call upon Mr Nicholson, who appeared for the worker, to respond to Mr Halligan’s submissions.

THE ARBITRATOR’S FINDINGS IN RELATION TO THE SECTION 151A DEFENCE

1. In its s 74 notice dated 7 March 2014, the appellant pleaded, amongst a range of other defences, a defence in these terms:

   “Pursuant to Deed dated 12 September 2012, you have received ‘damages’ within the meaning of Section 151A(1) of the Workers Compensation Act 1987 and your rights to compensation are thereby extinguished.”

2. The Arbitrator did not accept that the deed entered into and the monies payable pursuant to that deed constituted the payment of damages in respect of an injury. It followed that the Arbitrator found that the payment of the monies pursuant to the deed did not preclude Ms Mijatovic from pursuing her claim for lump sum compensation. The Arbitrator’s reasons for so finding are contained within the transcript of the arbitration hearing on 4 February 2016.

3. The Arbitrator noted that the onus of proof lies on the appellant to establish that Ms Mijatovic recovered damages “… in respect of an injury from the employer liable to pay compensation under the Act” (see Barnett v Country Rugby League of NSW Inc [2010] NSWWCCPD 73) (T37.17).

4. The Arbitrator considered the following relevant principles of law (T38.16):

   (a)     in construing contracts the parties’ subjective beliefs are irrelevant and the document has to be construed on an objective basis (Barn v Secretary, Department of Justice [2015] NSWWCCPD 6 at [46]–[47]), and

   (b)     it is the principal of objectivity by which the rights and liabilities of parties to a contract are determined not their subjective beliefs or understandings that govern their contractual relationship (Codelfa Construction Pty Ltd v State Rail Authority of NSW [1982] HCA 24; 149 CLR 337 (Codelfa)).

5. The Arbitrator referred (T39.30) to the approach to the construction of deeds in Mainteck Services Pty Ltd v Stein Heurtey SA [2014] NSWCA 184. In particular, the Arbitrator referred to the observations of Leeming JA (at [84], citing Pacific Carriers Ltd v BNP Paribas [2004] HCA 35 at [22]) with whom Ward and Emmett JA agreed:

   “Construction ‘requires consideration, not only of the text of the documents, but also the surrounding circumstances known to [the parties], and the purpose and object of the transaction’.”

6. The Arbitrator rejected the appellant’s submission that the deed in Adams was on all fours with the deed under consideration. In particular, the Arbitrator noted that the deed in Adams specifically identified that the release included, among other things, claims for damages.

7. Accordingly, the Arbitrator proceeded on the basis that he was “required to construe the deed on an objective basis noting the inconsistencies within it” (T41.33). He agreed with the appellant’s counsel that the operative clause (cl 2.1) in respect of the payment of $8,700 satisfied the definition of damages in s 149(1)(a) of the 1987 Act (T36.28; T42.3). However, the Arbitrator found that that of itself was not sufficient to dispose of the matter, as the damages must be “in respect of an injury” (T42).

8. The Arbitrator noted that cl 2.1 of the deed provided that the payment of $8,700 is said to be in respect of “the Personal Injury Claim”. He observed that Recital K defined the personal injury as “…psychological and personal injury as a result of her perception of alleged workplace bullying and victimisation as set out on the Complaint”. However he noted that “the Complaint” was not before him and he was not referred to it (T42.14).

9. The Arbitrator also noted that cl 4 recorded the releases between the parties which included:

   “(a)   the circumstances set out in the Recitals;

   (b)     the Employment or the termination of the Employment;

   (c)     the Flexible Working Decision;

   (d)     the Allegations;

   (e)     the Complaint; and/or

   (f)      the Personal Injury Claim,

   except any claims made in accordance with the provision of any applicable workers compensation legislation.”

10. The Arbitrator interpreted the deed on an objective basis looking at the deed itself and the words used “to give a reasonable meaning to that language if it can do so without doing complete violence to it” (Whishaw v Stephens [1970] AC 508) (T42.24).

11. The Arbitrator considered that the Recitals indicated that Ms Mijatovic had made a claim in the Australian Human Rights Commission and that the deed provided that that claim was to be discontinued (T42.30). He noted (at T42.33) that the release is said to:

    “cover the circumstances in the recitals, the employment or termination, the flexible working decision, the allegation, the complaint and the personal injury claim but expressly ‘excepts’ any claims made in accordance with the provision of any applicable workers compensation legislation.”

    Having made these observations, the Arbitrator found the claim before the Commission to be a claim made in “accordance with applicable workers compensation legislation” (T43.7).

12. The Arbitrator considered the ambiguity between cl 2.1 and cl 4. He found that the exception in cl 4 was expressed to cover “any” claims in respect of workers compensation (T43.27). Accordingly, in his view, the deed on its face did not relate to damages “in respect of an injury” within the meaning of s 151A because the right to “claim under applicable workers compensation legislation is excluded from the terms of the release in clause 4” (T43.33). The Arbitrator considered that any other interpretation of cl 4 would not provide Ms Mijatovic with any benefit from the express exception (T44.3). Accordingly the appellant’s defence under s 151A was rejected (44.10).

GROUNDS OF APPEAL

1. Having found that Ms Mijatovic had recovered damages in the sum of $8,700, it is alleged that the Arbitrator erred:

   (a)     in failing to find that those damages were in respect of an injury;

   (b)     in failing to find that the injury in respect of which Ms Mijatovic had recovered damages was the injury for which she sought an award of compensation in the current proceedings, and

   (c) in considering the construction of the releases contained in the deed between the parties of 12 September 2012 rather than the language contained in s 151A(1) of the 1987 Act.

APPLICABLE LEGISLATION

1. Section 149 of the 1987 Act defines damages as follows:

   “damages includes:

   (a)     any form of monetary compensation, and

   (b)     without limiting paragraph (a), any amount paid under a compromise or settlement of a claim for damages (whether or not legal proceedings have been instituted),

   …”

2. Section 151A of the 1987 Act provides:

   “151A   Effect of recovery of damages on compensation

   (1)     If a person recovers damages in respect of an injury from the employer liable to pay compensation under this Act then (except to the extent that subsection (2), (3) or (4) covers the case):

   (a)  the person ceases to be entitled to any further compensation under this Act in respect of the injury concerned (including compensation claimed but not yet paid) …”

GROUND ONE

Failure to make a factual finding

Submissions

1. The appellant pleaded a defence under s 151A of the 1987 Act. It submits that the Arbitrator accepted that Ms Mijatovic had recovered damages pursuant to the deed. Therefore the only issue left for him to determine was whether those damages were in respect of the same injury the subject of the current Application to Resolve a Dispute. This, the appellant submits, is consistent with the correct application of the principles set out by Handley AJA (Allsop P and Giles JA agreeing) in Adams. Handley AJA (at [17]) observed that it was not the deed itself which disentitled the worker, rather it was the payment of damages, in that instance the sum of $2,500.

2. The appellant submits that it is necessary and appropriate to look to the terms of the deed in this case only to determine whether the damages recovered were in respect of an injury and if so what that injury was. The Arbitrator failed to make any finding, positive or negative, in respect of that issue. His failure to do so constituted an error of law.

3. Regrettably Ms Mijatovic’s submissions do not succinctly deal with each ground of appeal. The submissions are in the form of a narrative and to a large extent repeat the submissions put to the Arbitrator. Submissions in this form contravene the provisions of Practice Direction No 6 – Appeal Against a Decision of the Commission Constituted by an Arbitrator and are unhelpful.

4. The focus of Ms Mijatovic’s submissions are directed to the question of the construction of the deed rather than the issue raised by ground one, namely whether under s 151A(1)(a) the amount of $8,700 recovered by Ms Mijatovic was damages “in respect of an injury”.

5. Ms Mijatovic submitted:

   “The question, whether or not the payment related to ‘damages’ for the settlement of the dispute concerning the respondent worker’s performance, working conditions, supervisor conduct and alleged employer discrimination [performance, conditions and discrimination] was not a question requiring the Arbitrator’s decision (see T42@15 and T422[4-3] [sic]).

   It appears (T26@5 and T42@[3-4]) that the Arbitrator may have been satisfied that the payment was a payment of damages relating to and confined to the performance, conditions and discrimination issue. The respondent does not need to address that matter given the Arbitrator’s finding (T36@[25] and discussion @T42-43) that the payment did not relate to the injury the subject of the workers compensation claim in these proceedings. That finding, it is submitted, for the reasons stated above was correct.”

Consideration

1. The Arbitrator failed to make any finding in respect of whether the damages recovered by Ms Mijatovic were in respect of an injury and, if so, what that injury was. In order to determine the pleaded defence under s 151A the Arbitrator was required to determine if the damages recovered pursuant to the deed were damages for the same psychological injury the subject of the application before the Arbitrator. The Arbitrator did not do that. That was an error. It was the same error identified in Adams. 

2. Rather, after he distinguished Adams, the Arbitrator construed the terms of the deed by attempting to resolve what he described as “a degree of tension, if not ambiguity” between cl 2.1 and cl 4. He noted that cl 2.1 provided for a payment which the Arbitrator described as “damages for the personal injury claim”, whereas cl 4 sought to exempt the claims made under any applicable workers compensation legislation. The Arbitrator’s resolution of that issue is conveniently summarised (at T43.30) where he said:

   “My view of the deed, which I accept is somewhat obscure and ambiguous, is that the worker was giving up all rights save as to any rights under the applicable workers compensation legislation. Accordingly, the deed on its face does not relate to damages ‘in respect of an injury’.”

3. The passage quoted above illustrates the Arbitrator’s error in his approach to determining the s 151A issue. The appellant submits, and I accept, that it was necessary and appropriate to look to the terms of the deed to determine whether the damages recovered were in respect of an injury and if so what that injury was. However, the Arbitrator focussed on a construction of the deed rather than applying the statutory language of s 151A to determine whether the amount paid to Ms Mijatovic pursuant to the deed was “damages in respect of an injury”.

4. It follows that ground one is upheld.

GROUND TWO

The correct finding of fact argued for by the appellant

Submissions

1. The appellant submits that Recitals H, I and K make it clear that the damages of $8,700 were in fact paid in respect of an injury.

2. Recital I records that a workers compensation claim had been made and denied. Recital J recorded the fact that the respondent had made a complaint to the Australian Human Rights Commission.

3. Recital K defines the “Personal Injury Claim”. It records that, as part of the complaint, Ms Mijatovic alleged that “certain actions by the Employer and certain employees had caused her to suffer psychological and personal injury as a result of her perception of alleged workplace bullying and victimisation as set out in the Complaint. The Employee provided a psychologist’s report dated 20 June 2012”.

4. The deed does not identify the author of the psychologist’s report of 20 June 2012. However, Ms Mijatovic’s detailed statements identify only one psychologist named “Sam” and the documents relied upon in the Application include three reports and a set of clinical notes of Dr Sam Albassit including one dated 20 June 2012.

5. The appellant submits that there can be little doubt that the psychologist’s report dated 20 June 2012 referred to in the deed is that of Dr Albassit of that date which is relied upon by Ms Mijatovic in these proceedings. It was alleged in both the application and his report that Ms Mijatovic’s condition resulted from the alleged workplace bullying and victimisation.

6. The appellant submits that there can be no doubt that the injury the subject of this claim and proceedings was identical to that described in Recital K to the deed.

7. Accordingly, so it is submitted, Ms Mijatovic had recovered damages in respect of the injury whereupon the effect of s 151A of the 1987 Act was to disentitle her to any further compensation under the Act.

8. Ms Mijatovic submits that the payment made to her by the appellant pursuant to the deed was not a payment of damages for the injury the subject of the claim in these proceedings. She submits it was a payment to resolve the dispute concerning the respondent’s work performance and working conditions, supervisor conduct and the alleged employer discrimination. She submits that this is consistent with Recital F.

9. Ms Mijatovic also submits that the payment relates to the termination of employment and the complaint lodged in the Human Rights Commission (Recital M). She further submits that the words “Personal Injury Claim” (Recitals K and L) relate to the Human Rights Commission discrimination complaint and employer conduct. The submission was not further developed as to why I should accept that the use of the words “Personal Injury Claim” in Recitals K and H relate only to the discrimination complaint and the employment issues and not the psychological injury.

10. Ms Mijatovic further submits that the terms of the deed indicate that it was the contractual intention of the parties that Ms Mijatovic was not releasing the appellant from her workers compensation entitlements.

11. Ms Mijatovic sought to distinguish the facts in Adams. She submitted that the deed under consideration in Adams specifically made reference to “damages” in the Recitals in that case, whereas in the instant matter the deed does not refer to “damages”. The word “damages” does not appear in the deed.

Consideration

1. In Adams, the worker received an injury to his left hand and wrist on 20 June 2003. His employment was terminated in 2003 and he commenced proceedings in the Australian Industrial Relations Commission against his former employer for unfair dismissal. Those proceedings were compromised and the parties executed a deed of release in January 2005. The deed recited the worker’s allegation that he had received work injuries in the course of his employment. Those injuries included, but were not limited to, an injury to his left hand and wrist. The deed stated that the employer agreed to pay the employee the sum of $2,500 “in respect of general and other damages” in return for the employee releasing the employer from “all claims and liabilities of any nature”. The employer forwarded the sum of $2,500 to the worker by cheque under cover of a letter dated 17 January 2005 which stated that the payment was in respect of “the agreed work injury damages.”

1. Handley AJA (Allsop P and Giles JA agreeing) held (at [24]) that the “character of the payment is governed by the deed and the letter of 17 January 2005 which accompanied the cheque”. His Honour added (at [27]):

   “The amount of $2,500.00 was also paid in respect of other claims, but this cannot matter. The deed and the letter, construed on their face, or in the light of the surrounding circumstances, establish that the payment was made ‘in respect of’ the injury to the worker’s left hand and wrist. Accordingly, he ceased to be entitled to compensation ‘in respect of the injury concerned’, that is the injury to his left hand and wrist.”

2. Although the facts in Adams may be distinguished from the facts in this case, nothing turns on the distinction. It is of no moment that the deed in this matter purports to exempt from the releases Ms Mijatovic’s entitlement to statutory benefits. That is because, as Handley AJA pointed out in Adams (at [17]), the deed could not have affected the worker’s rights to compensation because s 234 of the 1998 Act provides that the two acts, namely the workers compensation acts, apply “despite any contract to the contrary”. His Honour said (at [17]):

   “the worker’s difficulties flow not from the deed as such but from his acceptance of the payment of $2,500.”

3. It is not controversial that Ms Mijatovic was paid and accepted the sum of $8,700, in accordance with the terms of deed. Given the wide definition of damages in s 149, namely “any form of monetary compensation”, it was open to the Arbitrator to find that the payment constituted “damages” within the meaning of s 149. That finding was correct. The fact that the deed does not refer in terms to “damages” is not determinative given the width of the definition of damages in s 149.

4. In any event, Ms Mijatovic did not seek to argue that she did not receive damages. Rather, she submitted that the damages were not in respect of the same injury the subject of these proceedings. I do not accept that submission.

5. Ms Mijatovic’s submissions fail to deal with the appellant’s submission that the psychological injury which was the subject of the workers compensation claim in Recital I was the same psychological injury which is the subject of Recital K.

6. Although the complaint referred to in Recital K is not in evidence, it is not disputed that the complaint alleged a psychological injury and was supported by a psychologist’s report. I accept the appellant’s submission that the reference in Recital K to the psychologist’s report dated 20 June 2012 was undoubtedly a reference to the report of Dr Sam Albassit of the same date.

7. Dr Albassit’s report of 20 June 2012 is relied upon in support of the current Application seeking whole person impairment compensation and refers extensively to Ms Mijatovic’s psychological injury being caused by workplace bullying and victimisation and the events of 6 March 2012. In his report, Dr Albassit records a series of incidents that occurred prior to the meeting on 6 March 2012. He also records that at the meeting Ms Mijatovic’s request to have her pay reviewed was denied and that her work from home arrangements were brought to an end because they were no longer suitable to the appellant. He stated that following the meeting Ms Mijatovic “broke down, began to hyperventilate, panic, was highly anxious and almost to the point of ‘blacking out’”, following which she sought treatment from her general practitioner.  He then recorded that Ms Mijatovic presented with “major symptomatology of Depression and Anxiety”. He concluded that the above “chain of events” significantly contributed to her mental health deterioration.

8. The application in these proceedings records the injury to be a “psychological injury” as a result of employment related factors occurring between January 2011 and 6 March 2012 (see [13] above). The initiating claim for permanent impairment compensation was made on 19 January 2015. It sought compensation “for psychological injury” with a deemed date of injury of 6 March 2012. The claim was supported by a report of Dr Canaris dated 10 December 2014. The history recorded by Dr Canaris in support of the worker’s claim, which is referred to at [11] of this decision, is almost identical to the history recorded by Dr Albassit in support of the complaint to the Australian Human Rights Commission. Both doctors concluded that the events described led to the depressive disorder from which Ms Mijatovic now suffers. It follows that the injury identified by Dr Albassit and Dr Canaris is the same.

9. Although the deed seeks to distinguish between the workers compensation claim (Recital I) and personal injury claim (Recital K) that is not to the point. What is relevant is whether Ms Mijatovic received damages in respect of the injury the subject of the present proceedings, namely, the injury identified by Dr Canaris. For the reasons discussed above, I am satisfied that the injury the subject of the present proceedings is the same injury, namely, the psychological injury, caused by Ms Mijatovic’s perception of events in the course of her employment described in Recitals A to H.

10. The fact that within a few weeks after sustaining the psychological injury complained of, Ms Mijatovic lodged both the workers compensation claim and the discrimination claim on 27 March 2012, each alleging a psychological injury, reinforces the conclusion I have reached, namely, that the injury the subject of the complaint and the injury the subject of the workers compensation claim are the same psychological injury.

11. It follows that as Ms Mijatovic had recovered damages in respect of the injury the subject of these proceedings, the effect of s 151A of the 1987 Act was to disentitle her to any further compensation under the Act.

12. As discussed in Adams (at [27]) the fact that the payment to Ms Mijatovic may also have been paid in respect of other claims is irrelevant. The deed construed on its face in the light of the surrounding circumstances established that the payment was made in respect of the worker’s psychological injury. Accordingly Ms Mijatovic ceased to be entitled to compensation “in respect of the injury concerned”, that is, the psychological injury, when she accepted the payment of $8,700.

13. I reject Ms Mijatovic’s submission that a proper construction of the deed demonstrates that it was the contractual intention of the parties to keep Ms Mijatovic’s workers compensation entitlements open. That is because the meaning of the deed cannot be determined by the parties’ subjective beliefs. As was explained by Mason J in Codelfa (at [24]):

    “Consequently when the issue is which of two or more possible meanings is to be given to a contractual provision we look, not to the actual intentions, aspirations or expectations of the parties before or at the time of the contract, except in so far as they are expressed in the contract, but to the objective framework of facts within which the contract came into existence, and to the parties' presumed intention in this setting. We do not take into account the actual intentions of the parties and for the very good reason that an investigation of those matters would not only be time consuming but it would also be unrewarding as it would tend to give too much weight to these factors at the expense of the actual language of the written contract.”

14. It follows the contractual intention of the parties cannot be determinative of the question of whether Ms Mijatovic recovered damages in respect of an injury (s 151A).

15. For these reasons ground two must succeed.

GROUND THREE

1. The appellant submits and I accept, as I have indicated, that the Arbitrator erred in considering the construction of the deed rather than the effect of the payment of $8,700 made to Ms Mijatovic. In light of the principles discussed in Adams, that analysis was not only unnecessary but erroneous.

2. Other than to seek to distinguish Adams on the facts, Ms Mijatovic did not traverse the appellant’s submission under this ground.

CONCLUSION

1. Although the Arbitrator commenced his analysis of the issues by identifying the correct question, namely whether damages had been paid in respect of an injury, he failed to come to a conclusion in answer to that question. The Arbitrator erred by seeking to resolve the issue by a construction of the deed rather than to consider the legal effect of the payment it evidenced. The Arbitrator failed to discharge the statutory task with which he was presented. For the reasons given the appeal must succeed and the Arbitrator’s determination must be revoked.

2. As I have found that the payment and receipt of $8,700 pursuant to the deed constituted damages for the same injury the subject of these proceedings, Ms Mijatovic ceases to be entitled to any further compensation under the 1987 Act by the operation s 151A(1). As Handley AJA said in Adams (at [28]) “the 1987 Act in its present form is intractable” and the Commission has no option but to give effect to the clear language of Parliament. Although this is an unfortunate result there must be an award for the respondent.

ORDERS

1. The Arbitrator’s determination of 18 February 2016 is revoked and, in its place, the following order is made:

   “1. Award for the respondent.”

Judge Keating

President

28 June 2016