Sydney Opera House Trust v Sykes

[2006] NSWWCCPD 227

WORKERS COMPENSATION COMMISSION

DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR

CITATION:Sydney Opera House Trust v Sykes [2006] NSWWCCPD 227

APPELLANT:  Sydney Opera House Trust

RESPONDENT:  Tanya Sykes

INSURER:GIO General Limited

FILE NUMBER:  WCC15421-05

DATE OF ARBITRATOR’S DECISION:          21 December 2005

DATE OF APPEAL DECISION:  13 September 2006

SUBJECT MATTER OF DECISION: Leave to appeal; section 308 Workplace Injury Management and Workers Compensation Act 1998; costs

PRESIDENTIAL MEMBER:  Acting Deputy President Bill Roche

HEARING:On the papers

REPRESENTATION:  Appellant:      Moray & Agnew

Respondent:   Leigh Virtue & Associates

ORDERS MADE ON APPEAL:  Leave to appeal is refused.

The Appellant Employer is to pay the Respondent Worker’s costs of the appeal.

BACKGROUND TO THE APPEAL

1. On 10 January 2006 Sydney Opera House Trust (‘the Appellant Employer’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision, dated 21 December 2005.

1. The Respondent to the Appeal is Tanya Sykes (‘the Respondent Worker/Ms Sykes’).

1. Ms Sykes was employed by the Appellant Employer on 30 May 2005 as a rehabilitation co-ordinator.  Her contract of employment was intended to expire on 30 November 2005.  On 23 June 2005 she was involved in a motor vehicle accident on her way home from work and sustained injury.  She returned to work on or about 8 July 2005 but had a number of days off work before her employment was terminated on 14 July 2005.

1. The Respondent Worker remains off work and has been paid and continues to be paid all her entitlements to hospital and medical expenses and weekly compensation under the provisions of the Workers Compensation Act 1987 (‘the 1987 Act’). There is no outstanding claim for compensation before the Commission.

1. On 9 September 2005 Ms Sykes filed an Application to Resolve a Workplace Injury Management Dispute (‘the Application’) alleging that:

(a)the injury management plan had not been followed;

(b)there was no return to work plan, and

(c)no suitable duties had been provided.

1. The Application was conciliated by the Registrar, through her delegate, on 22 September 2005 when he was unable to find that a dispute had been made out in respect of points (a) and (b) above.  In respect of point (c) the Registrar stated that “since the Commission is unable to provide the worker with a remedy of reinstatement to her employment with the Respondent it would be inappropriate…to make such the subject of a recommendation”.  As a result the Registrar determined:

·     “To decline making a recommendation.

·      To decline an order for costs against the Respondent.”

1. The Respondent Worker submits that the Registrar’s delegate could not and did not deal with the proceedings as he is not a member of the Commission. I reject that submission. It ignores section 371 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) which provides that the Registrar can delegate any of the Registrar’s functions under the Workers Compensation Acts (the 1987 Act and the 1998 Act). I reject the submission that the Registrar simply attempted to conciliate the matter and then referred the matter to a member of the Commission under section 310 of the 1998 Act. That is patently not what happened. The Registrar was requested by the Respondent Worker to make a recommendation pursuant to Division 3 of Part 5 of the 1998 Act that the Appellant Employer provide Ms Sykes with suitable duties. In detailed reasons given on 29 September 2005, the Registrar declined to make the recommendation sought. By letter dated 6 October 2005 the Respondent Worker sought that the matter be referred to the Commission for determination under section 308 of the 1998 Act. The matter was then referred to a Commission Arbitrator for determination.

1. At the Arbitration hearing the Appellant Employer challenged the Arbitrator’s jurisdiction to hear the matter.  After a lengthy hearing the Arbitrator held that he did have jurisdiction to hear the matter but he declined to make a recommendation pursuant to section 307 of the 1998 Act and he ordered the Appellant Employer to pay the Respondent Worker’s costs.  The Appellant Employer seeks leave to appeal the Arbitrator’s decision.

THE DECISION UNDER REVIEW

1. The ‘Certificate of Determination’, dated 21 December 2005, records the Arbitrator’s orders as follows:

“1.Having regard to the requirement of s49, I decline to make a recommendation pursuant to s307 of the Workplace Injury Management and Workers Compensation Act 1998.

2.I determine that this matter, which went directly to Arbitration, was a complex matter as provided for by Regulation 129 of the Workers Compensation (General) Amendment (Costs) Regulation 2001.

3.The Respondent is to pay the Applicant’s costs as agreed or assessed.”

ISSUES IN DISPUTE

1. The issues sought to be raised in the appeal are whether the Arbitrator erred in:

(a)finding that he had jurisdiction to hear and determine the matter (‘jurisdiction’);

(b)ordering the Appellant Employer to pay the Respondent Worker’s costs (‘costs’), and

(c)purporting to find that the Respondent Worker was terminated for reasons connected with her injury (‘reason for termination’).

PRELIMINARY MATTERS

1. Section 354(6) of the 1998 Act provides:

“(6)If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”

1. The Appellant Employer submits that having regard to the significant issues involved it would wish to advance oral arguments in support of the appeal.  The Respondent Worker submits that the matter can be dealt with on the papers, but only if she is to succeed.

1. Each side has made detailed submissions on the issues.  I do not believe those issues are so complex or difficult that an oral hearing is warranted.  I believe I am able to properly and fairly determine the matter without an oral hearing.

2. Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances. 

LEAVE TO APPEAL

Time

1. The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.

Monetary Threshold

1. Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act.  That section provides:

“352          Appeal against decision of Commission constituted by Arbitrator

(1)A party to a dispute in connection with a claim for compensation may, with leave of the Commission constituted by a Presidential member, appeal to the Commission as so constituted against a decision in respect of the dispute by the Commission constituted by an Arbitrator.

(2)The Commission is not to grant leave to appeal unless the amount of compensation at issue on the appeal is both:

(a)  at least $5,000 (or such other amount as may be prescribed by the regulations), and

(b)  at least 20% of the amount awarded in the decision appealed against.

(3)If the Commission refuses to grant leave to appeal, the Commission must state reasons for the refusal in writing to the parties.

(4)An appeal can only be made within 28 days after the making of the decision appealed against.

(5)An appeal under this section is to be by way of review of the decision appealed against.

(6)Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against may not be given on an appeal to the Commission except with the leave of the Commission.

(7)On appeal, the decision may be confirmed or may be revoked and a new decision made in its place. Alternatively, the matter may be remitted back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions of the Commission.

(8)In this section, decision includes an award, interim award, order, determination, ruling and direction.”

1. Before leave to appeal can be granted it is necessary that “the amount of compensation at issue on the appeal” is both “at least $5,000.00” and “at least 20% of the amount awarded in the decision appealed against”.

1. The Appellant Employer argues that this is not a case where the monetary threshold in section 352(2) needs to be satisfied because the Respondent Worker did not seek compensation and section 352(8) contemplates appeals from orders, determinations, rulings and directions.

1. Reliance is placed on Mawson v Fletchers International Exports Pty Limited [2002] NSWWCCPD 5 (‘Mawson’) where Deputy President Bryon said at [22]:

“22. No amount was awarded in the decision appealed against. An award was not an appropriate outcome given that the dispute before the Arbitrator was entirely related to applications for directions and not to the merits or other aspects of the substantive claim made by Mr. Mawson, and which is in dispute before the Commission, but not yet dealt with. While a reference to the Second Reading Speech was not helpful on the particular point, a “meaningful result” is not achieved by merely ignoring the provisions of subsection (8) of section 352. It seems that “20%” in subsection (2)(b) is limited to a decision in which an award is made and that the operation of this subsection does not preclude appeals against decisions in which no award was made. The purpose of subsection 2(b) in my view, applies a qualification or condition that must be met before leave to appeal is granted against a decision in which an award is made, but that particular qualification or condition does not and cannot meaningfully apply to a decision where this is not the case.”

1. However, this submission ignores the fact that the principle relief sought in Mawson was weekly compensation and it was not disputed that the amount of compensation ‘at issue’ in the appeal in that case was greater than $5,000.00 (see Mawson at [14]). That is not the case in the present matter.

1. The term “compensation” is defined in section 4 of the 1998 Act as follows:

“compensation means compensation under the Workers Compensation Acts, and includes any monetary benefit under those Acts.”

1. In the present case the Application does not seek an order for the payment of “compensation” but merely noted that the injury management plan had not been followed, there was no return to work plan, and no suitable duties had been provided.  Therefore, no “compensation” is “at issue” on appeal and the appeal does not meet the threshold test in section 352(2).

1. The amount of compensation at issue on the appeal must be determined by reference to the amount of compensation at issue in the proceedings before the Arbitrator at first instance.  In Grimson v Integral Energy [2003] NSWWCCPD 29 at [30] Deputy President Fleming held:

“The preferred interpretation, in my view, is that the Commission, constituted by a Presidential Member, may grant leave only to appeal against a decision of an Arbitrator where there is an amount of compensation at issue on the appeal that is (a) at least $5,000, and, if a monetary award has been made, (b) at least 20% of that award. The “. . . amount of compensation at issue on the appeal” is determined by reference to the amount of any monetary award made by the Arbitrator or, where no monetary award is made, the amount of the claim as particularized by the Applicant.”

1. It is possible to appeal against an interlocutory decision where no monetary compensation has been awarded (see Mawson) but only where the decision or order has a real capacity to put the award of ‘compensation’ in issue in the appeal.  In Fletchers International Exports Pty Ltd v Regan [2004] NSWWCCPD 7 at [27] it was noted:

“While a decision of an Arbitrator may not concern an ‘award’ of compensation (as in Mawson), the appeal must nonetheless affect an ‘amount of compensation at issue on the appeal’ to pass the threshold test in section 352(2)(b). Purely procedural decisions, such as a decision to adjourn a telephone conference (Tagg v International Flavours and Fragrances (Australia) Ltd [2003] NSW WCC PD 5), a decision in relation to costs only (Grimson v Integral Energy [2003] NSWWCC PD 29), and a decision to schedule a further telephone conference (Falcon v Narellan Enterprises Pty Limited [2003] NSW WCC PD 34) do not meet this threshold criterion. The decision must have a real capacity to put the amount of compensation, determined by reference to the decision or the claim (Sheridan v Coles Supermarkets Australia Pty Limited [2003] NSWWCC PD 3), in issue in the appeal (as in the case of the filing of a ‘Reply’ (ADCO Constructions Pty Ltd v Ferguson [2003] NSWWCC PD21)).” (emphasis added)

1. In the present case as no ‘amount of compensation’ was claimed in the Application before the Arbitrator there is no amount of compensation “at issue” on appeal and the thresholds in section 352 of the 1998 Act have not been met.

1. Leave to appeal is refused.

OTHER MATTERS

1. If I am wrong on the threshold issue set out above I make the following observations on the substantive matters sought to be raised in the appeal.

Jurisdiction

1. The Appellant Employer relies on section 296(2) of the 1998 Act which provides “except as provided by this Part, the exercise of any function of the Registrar under this Part is not subject to appeal or review”. The only right of appeal or review under Part 5 is that set out in section 308 of the 1998 Act which provides in subsection (1):

“308     Compliance with recommendations of Registrar

(1) A party to the dispute to whom a recommendation is made by the Registrar must, within 14 days (or such longer period as the Registrar may allow in a particular case):

(a)  comply with the recommendation, or

(b)  request the Registrar to refer the dispute to the Commission for determination.

Maximum penalty: 50 penalty units.” (emphasis added)

1. It is submitted that the facility for referring a dispute to the Commission is only available to a party “to whom a recommendation is made”. As no recommendation was made in the present matter, there was no party to whom a recommendation was made and, therefore, the Respondent Worker had no right to request the Registrar to refer the dispute to the Commission under section 308. I agree with this submission and the reasoning behind it. It follows that the Arbitrator had no power to hear and determine the matter before him.

1. The Respondent Worker submits, in the alternative to the submissions noted at paragraph [7] above, that the words “to whom a recommendation is made” must include a situation where a recommendation has been sought but has been refused because to read the section any other way would render the section meaningless. I do not agree. The party to whom a recommendation is made has the right to request the Registrar to refer the dispute to the Commission. In addition, section 306 gives the Registrar power to “refer the dispute to the Commission for determination if action under this Division is not successful”. I believe this provision, even though it appears as a note to section 306, does give the Registrar power to refer matters to the Commission in the appropriate circumstances. However, there was no referral by the Registrar under section 306 in the present case. There was a request by the Respondent Worker under section 308(1)(b). The section does not permit a request by the Respondent Worker in the circumstances of the present case as she was not “a party” “to whom a recommendation” was made.

1. It follows that I believe the Arbitrator was in error in purporting to hear and determine the matter but, as leave to appeal is refused, I am powerless to formally correct that error.

Costs

1. The Appellant Employer succeeded before the Arbitrator and the Respondent Worker failed to obtain the substantive relief she sought.  Notwithstanding the Appellant Employer’s success the Arbitrator ordered it to pay Ms Sykes’ costs.  The Arbitrator made this order because he felt that, though the Respondent Worker was not entitled to the relief sought, Ms Sykes’ employment had been terminated for reasons connected with her injury and had the case been determined prior to 30 November 2005 she may well have succeeded.  The issue of whether the Respondent Worker’s employment was terminated for reasons connected with her injury was strongly contested at the Arbitration hearing.  However, the Respondent Worker still failed with her claim because the Arbitrator found that it was not “reasonably practicable to provide employment” in accordance with section 49(3)(a) of the 1998 Act.  That being so the issue of why Ms Sykes’ employment was terminated was irrelevant.

1. In making a costs order against the Appellant Employer the Arbitrator appears to have failed to have regard to established authority on the issue of costs.

1. A successful party should only be ordered to pay the costs of the unsuccessful party in exceptional circumstances.  That has occurred in situations where the behaviour of the successful party involved some misconduct (Donald Campbell & Co Ltd v Pollack [1927] AC 732) or some impropriety (Trenerry v Trenerry [1962] 2 NSWLR 221.

1. On the issue of whether the successful party should be ordered to pay the costs of the unsuccessful party the decision of McHugh J in Oshlack v. Richmond River Council (1998) 193 CLR 72 at 97-98 is most instructive:

“The traditional exceptions to the usual order as to costs focus on the conduct of the successful party which disentitles it to the beneficial exercise of the discretion. In Anglo-Cyprian Trade Agencies Ltd. v. Paphos Wine Industries Ltd, Devlin J formulated the relevant principle as follows:

‘No doubt, the ordinary rule is that, where a plaintiff has been successful, he ought not be deprived of his costs, or, at any rate, made to pay the costs of the other side, unless he has been guilty of some sort of misconduct.’

‘Misconduct’ in this context means misconduct relating to the litigation, or the circumstances leading up to the litigation. Thus, the court may properly depart from the usual order as to costs when the successful party by its lax conduct effectively invites the litigation; unnecessarily protracts the proceedings; succeeds on a point not argued before a lower court; prosecutes the matter solely for the purpose of increasing the costs recoverable; or obtains relief which the unsuccessful party had already offered in settlement of the dispute.” (emphasis added)

1. Applying the above authority a successful employer should not be ordered to pay the costs of an unsuccessful worker unless the employer has:

(a)been guilty of some sort of misconduct;

(b)by its lax conduct, effectively invited the litigation, or

(c)unnecessarily or unreasonably protracted the proceedings.

1. Therefore, I believe the Arbitrator was in error in ordering the successful Appellant Employer to pay the costs of the unsuccessful Respondent Worker.  However, as leave to appeal is refused I am powerless to correct this error.  For the same reason I am powerless to entertain the Appellant Employer’s application that the Respondent Worker pay its costs of the Arbitration proceedings.

Reason for Termination

1. The finding that the Respondent Worker’s employment was terminated for reasons connected with her injury was made after substantial evidence was heard.  Whilst it was not a finding that was necessary for the determination of the matter, it was an issue before the Arbitrator.  As I am unable to grant leave to appeal it is not appropriate for me to comment on this part of the claim as it relates to the unique circumstances of this matter and does not raise any issue of general importance.

DECISION

1. Leave to appeal is refused.

COSTS

1. The Appellant Employer is to pay the Respondent Worker’s costs of the appeal.

Bill Roche

Acting Deputy President  

13 September 2006

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

ASSOCIATE