Theoret v Aces Incorporated

[2021] NSWCA 3

Court of Appeal

Supreme Court

New South Wales

• Summary available

Medium Neutral Citation:

Theoret v Aces Incorporated [2021] NSWCA 3

Hearing dates:

1 September 2020

Decision date:

02 February 2021

Before:

Leeming JA at [1];
McCallum JA at [2];
Garling J at [49].

Decision:

(1) Allow the appeal.

(2) Set aside the judgment of the court below.

(3) Remit the matter to the Workers Compensation Commission to be determined according to law.

(4) Respondent to pay the appellant’s costs.

Catchwords:

STATUTORY INTERPRETATION — Amendment — where appellant’s entitlement to weekly workers compensation payments arose before but was not determined until after 2012 amendments to Workers Compensation Act 1987 (NSW) came into force — whether s 82A of Act as currently in force entitles the appellant to have pre-injury average weekly earnings indexed historically from the time she first became eligible to receive weekly payments in respect of the relevant injury or only from the time the amendments came into force in 2012

Legislation Cited:

Interpretation Act 1987 (NSW), ss 39, 45C

WorkersCompensation Act 1987 (NSW), ss 33, 36, 37, 38, 43(1), 44C, 66, 79, 80, 82, 82A, Sch 3

Workers Compensation Legislation Amendment Act 2012 (NSW)

Workers Compensation Legislation Amendment Act 2018 (NSW)

Workplace Injury Management and Workers Compensation Act 1998 (NSW), ss 78, 353

Cases Cited:

ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1; [2014] HCA 18

Bresmac Pty Ltd v Starr (1992) 29 NSWLR 318

Cooper Brookes(Wollongong) Pty Ltd v Commissioner of Taxation (Cth) (1981) 147 CLR 297; [1981] HCA 26

Cram Fluid Power Pty Ltd v Green [2015] NSWCA 250

Fisher v Hebburn Ltd (1960) 105 CLR 188; [1960] HCA 80

Hochbaum v RSM Building Services Pty Ltd; Whitton v Technical and Further Education Commission t/as TAFE NSW [2020] NSWCA 113

Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28

Thompson v ATN Channel 7 Pty Ltd (No 2) [2017] NSWWCC 269

Category:

Principal judgment

Parties:

Patricia Theoret (Appellant)
Aces Incorporated (Respondent)

Representation:

Counsel:
D Hooke SC, B McManamey (Appellant)
M Allars SC, A Combe (Respondent)

Solicitors:
Carroll & O’Dea Lawyers (Appellant)
Hicksons Lawyers (Respondent)

File Number(s):

2020/118949

Publication restriction:

None

 Decision under appeal 

Court or tribunal:

Workers Compensation Commission

Citation:

[2020] NSWWCCPD 18

Date of Decision:

25 March 2020

Before:

Elizabeth Wood, Deputy President

File Number(s):

A1-5261/19

HEADNOTE

[This headnote is not to be read as part of the judgment]

The appellant suffered injuries at different times during the same employment. She first became entitled to weekly payments of workers compensation in 2004. However, her entitlement to weekly payments in respect of a different injury was not determined until April 2019. In the meantime, on 1 October 2012, substantial amendments to the Workers Compensation Act 1987 (NSW) were introduced including amendments to the process for determining the quantum of weekly payments. The appeal raised the application of those amendments where the entitlement to weekly payments arose before the commencement of the amendments but the appellant was not an existing recipient of weekly payments at the time the amendments came into force.

Both before and after the commencement of the 2012 amendments, the statute provided for indexation of weekly compensation payments. Under the amended legislation a worker’s entitlement to weekly payments is calculated as a percentage of “pre-injury average weekly earnings”. In Ms Theoret’s case, that sum is derived from her earnings back in 2002. The issue to be determined on appeal was whether, under the amended provisions, the dollar amount determined by reference to the pre-injury earnings in 2002 is subject to indexation from the time Ms Theoret first became entitled to receive weekly benefits for the relevant injury or only from April 2013, the first review date following the introduction of the 2012 amendments. The resolution of that issue turned on the proper construction of s 82A of the Act as currently in force.

Held (per McCallum JA; Leeming JA and Garling J agreeing), allowing the appeal:

(1) The appellant’s argument was not that s 82A should operate retrospectively but that it should apply to weekly compensation payments to which she became entitled after the commencement of the section: at [23].

(2) The transitional provisions in Sch 6 Pt 19H cl 3(2) of the 1987 Act make plain that the 2012 amendments have no application to compensation paid before 1 October 2012: at [24].

(3) Although the State Insurance Regulatory Authority is required to publish the number that represents the factor to be applied in the indexation task for each review date, the Authority’s failure to do so for review dates before the commencement of the 2012 amendments does not alter the construction of s 82A: at [30], [32]-[33]. The section gives effect to the relevant adjustment of its own force. It does not depend on the Authority fulfilling its duty, although the fulfilment of that duty has real utility: [39], [47].

(4) The words of sub-section 82A(5) operate as a deeming provision and indicate that historical indexation is not inconsistent with or prohibited by s 82A: at [34]-[35].

Judgment

1. LEEMING JA: I agree with McCallum JA, for the reasons her Honour gives, that the appeal should be allowed and the matter remitted to the Workers Compensation Commission to be determined in accordance with law. As Garling J points out, it will be necessary in order to apply the indexation required by s 82A to determine when for the purposes of that section Ms Theoret became entitled to weekly payments in respect of the injury occasioned by her assault in 2002, that being a question of fact which did not arise for determination on the approach taken by the Arbitrator and the Deputy President.

2. McCALLUM JA: Patricia Theoret was punched in the face by a client while she was working as a disability support worker. She sustained injuries as a result of which, as the relevant workers compensation insurer has recently accepted, she has no current work capacity. However, her entitlement to workers compensation has been complicated by the fact that she suffered other injuries during the same employment. The assault occurred in 2002. While Ms Theoret has received compensation in respect of other injuries since then, her entitlement to weekly payments in respect of the injuries caused by the assault was not determined until April 2019. In the meantime, on 1 October 2012, substantial amendments to the Workers Compensation Act 1987 (NSW) were introduced including amendments to the process for determining the quantum of weekly payments. This appeal concerns the application of those amendments where, as here, the relevant injury was sustained before the commencement of the amendments but the entitlement to weekly payments had not been determined at the time the amendments came into force.

3. Both before and after the commencement of the 2012 amendments, it was an accepted precept of the workers compensation statutory regime that weekly compensation payments would need to be adjusted on a regular basis (by a statutory method of indexation) so as to keep up with contemporary economic standards. The method of indexation prescribed by the statute before and after the amendments was similar, providing for the multiplication of a dollar amount by an externally sourced index factor. Before the amendments, the index factor for weekly compensation was calculated by reference to the award rate of pay index (“adjustable amount x latest index number/base index number”): s 80 of the Workers Compensation Act 1987 as it stood immediately before 1 October 2012. Section 82A replaces that method in the case of weekly compensation payments with a factor expressed by reference to the Consumer Price Index (CPI).

4. Further, in each case, while the relevant factor was capable of being calculated by any person up for the challenge, the need to do so was obviated by the imposition on the State Insurance Regulatory Authority (or, for a time after the 2012 amendments were introduced, the Minister) of an obligation to determine the factor and publish it. Section 82 of the Act as it stood before 1 October 2012 required the Authority to declare the relevant factor by notice published in the Government Gazette on or before each “adjustment date”, a term defined to mean 1 April or 1 October in each year: s 79. Section 82A of the Act as currently in force requires the Authority to declare the number that equates to the relevant factor by order published on the NSW legislation website on or before each “review date”, a term also defined to mean 1 April and 1 October in each year.

5. The problem Ms Theoret has is that, under the legislation introduced on 1 October 2012, a worker’s entitlement to a weekly benefit is calculated as a percentage of “pre-injury average weekly earnings”. In Ms Theoret’s case, that sum is derived from her earnings back in 2002 when, as it was put by her counsel, she was being paid in 2002 dollars. The issue raised by the appeal is whether, under the provisions introduced in 2012, the dollar amount determined by reference to Ms Theoret’s pre-injury earnings in 2002 is subject to indexation from the time she first became entitled to receive weekly benefits or only from April 2013, the first review date following the introduction of the 2012 amendments.

6. The resolution of that issue turns on the proper construction of s 82A of the Act as currently in force. In short, Ms Theoret argues that she is entitled under that section to have the relevant dollar amount indexed from the time of her first receipt of weekly compensation from the respondent, which was in June 2004. The insurer argues that the method of indexation provided for in s 82A can, in accordance with the text of the section, only operate from 1 October 2012, the date on which the section came into force.

Circumstances in which the issue arises

7. The relevant chronology may be summarised as follows. On 29 May 2001, Ms Theoret sustained an injury to her lumbar spine in the course of her employment with the respondent. 23 December 2002 was the date of the assault. On 17 November 2003, Ms Theoret submitted a claim for workers compensation. In June 2004, she ceased her employment with the respondent. That was when she first became entitled to receive weekly compensation. However, it appears payments were made at that stage in respect of the 2001 injury to her spine.

8. As already noted, the amendments which introduced s 82A (the Workers Compensation Legislation Amendment Act 2012 (NSW)) came into force on 1 October 2012.

9. Ms Theoret received weekly payments until September 2017. In 2018, the insurer carried out a work capacity assessment in relation to the injuries resulting from the assault in 2002. As a result of that assessment, Ms Theoret continued to be entitled to receive workers compensation payments including weekly payments.

10. On 3 April 2019, the insurer gave notice under s 78 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) that it had assessed Ms Theoret as having no work capacity. The notice also advised Ms Theoret of the insurer’s decision under s 43(1)(d) of the Workers Compensation Act 1987 that her “indexed PIAWE” (pre-injury average weekly earnings) was $466.

11. On 24 July 2019, Ms Theoret’s lawyers sought a review of the s 78 decision, arguing that the pre-injury average weekly earnings should be indexed from the date she first received weekly compensation. Ms Theoret’s lawyers inferred (correctly, as it turned out) that the figure of $466 had been reached by indexing the relevant amount only from April 2013. According to a calculation sheet prepared on behalf of Ms Theoret, assuming indexation should be applied from the date on which she first received weekly compensation (which was June 2004), the correct figure was $664.15. The insurer was unmoved.

12. Ms Theoret applied to the Workers Compensation Commission for expedited assessment of the weekly benefits. The assessment was determined by an arbitrator on 6 November 2019. The Arbitrator had considered the construction of s 82A in an earlier decision in Thompson v ATN Channel 7 Pty Ltd (No 2) [2017] NSWWCC 269. In that decision, after a careful analysis of the competing arguments, the Arbitrator concluded that the indexation applied from the first review date after 1 October 2012, not from the earlier date being the first review date after the date on which the worker became entitled to weekly payments. The Arbitrator applied the same reasoning to reach the same conclusion in the case of Ms Theoret.

13. Ms Theoret appealed against the decision of the Arbitrator. Her appeal was dismissed by Deputy President Elizabeth Wood, who considered that the conclusion reached by the Arbitrator was correct.

Ground of appeal

14. The appeal raises a single ground, which is:

“The Deputy President erred in point of law when she held that section 82A of the Workers Compensation Act 1987 (NSW) only applied to index the appellant’s pre-injury average weekly earnings from 1 April 2013 and not from the date she first received weekly compensation.”

15. The appeal lies as of right pursuant to s 353 of the Workplace Injury Management and Workers Compensation Act 1998 (NSW) and is limited to error in point of law.

Legislative framework

16. The legislative framework was explained in the appellant’s written submissions. It was noted that, prior to the introduction of the 2012 amendments, the calculation of weekly compensation for a worker entitled to weekly benefits under s 36 (the first 26 weeks), s 37 (total incapacity) or s 38 (partial incapacity) of the Workers Compensation Act was fixed by reference to two factors. The first was the worker’s “current weekly wage rate” calculated in accordance with s 42. The current weekly wage rate was “current” in that it was determined by reference to probable earnings contemporaneous to the period for which each payment of compensation was made. The appellant noted that the determination of that rate was evidence-based and had regard to comparable employees, applicable awards, contracts of employment and other industrial instruments, which made it cumbersome and costly. The second was the “statutory indexed rate” determined in accordance with s 37 of the Act as it then stood.

17. The 2012 amendments instead introduced a method of calculation by reference to “pre-injury average weekly earnings” originally defined in s 44C of the Act (as introduced on 1 October 2012), now contained in schedule 3 to the Act. As already noted, the weekly dollar amount derived in that way is subject to indexation in accordance with s 82A of the Act. The appellant’s written submissions noted “the determination is informed by the worker’s earnings at the time he or she first became entitled to weekly payments, which are then indexed without regard to any further evidentiary enquiry.” In other words, in place of the cumbersome process of discerning the “current weekly wage rate”, which was calculated to achieve a weekly compensation rate of appropriate current value, the only safeguard against inflation after the 2012 amendments was the requirement for indexation under s 82A.

18. Section 82A provides:

82A Indexation–weekly payments

(1) The amount of a weekly payment to a worker under Division 2 in respect of an injury is to be varied on each review date after the day on which the worker became entitled to weekly payments in respect of that injury, by varying the amount of the worker's pre-injury average weekly earnings for the purposes of the calculation of the amount of the weekly payment in accordance with the formula–

where–

A is the amount of the worker's pre-injury average weekly earnings within the meaning of Division 2 or, if that amount has been varied in accordance with this section, that amount as last so varied.

B is–

(a) the CPI for the December quarter immediately prior to the review date when the review date is 1 April, or

(b) the CPI for the June quarter immediately prior to the review date when the review date is 1 October.

C is–

(a) the CPI for the June quarter immediately prior to the review date when the review date is 1 April, or

(b) the CPI for the December quarter immediately prior to the review date when the review date is 1 October.

(2) In this section–

CPI means the consumer price index (All Groups Index) for Sydney issued by the Australian Statistician.

review date means 1 April and 1 October in each year.

(3) (Repealed)

(4) The Authority is to declare, by order published on the NSW legislation website on or before each review date, the number that equates to the factor

for the purposes of the variation required for that review date under this section.

(5) A declaration made by an order published on the NSW legislation website after a review date for the purposes of the variation required for that review date under this section has effect as if the order were published before that review date.

19. The Authority publishes a table of numbers equating to the factor but only for review dates commencing on 1 April 2013.

Two misconceptions to be dispelled

20. The appellant noted that, in rejecting her construction of s 82A, both the Arbitrator and the Deputy President evidently understood her argument to require s 82A to be read “retrospectively”. The Arbitrator said at [39]:

“I accept the applicant’s submission that section 82A(5) provides that the Authority can publish a figure after the review date and that means ‘that the legislation allows for the publication of historical review dates’. However, what the submission ignores is that the Authority, and previously the Minister, did not publish ‘historical review figures’ for the period prior to 1 April 2013. Whilst such a right clearly exists under s 82A(5), it has not been exercised. The review figures specifically provide that the indexation commences on 1 April 2013.”

21. The relevant passage of the Deputy President’s decision is at [83], where she said:

“On the appellant’s own submission, up until the 2012 amendments, the appellant’s weekly entitlements were determined by the application of the former ss 35, 37 and 40 of the 1987 Act, and were calculated by reference to comparable earnings. The appellant’s rights and entitlements for any period prior to 1 January 2013 remain unaffected by the 2012 amendments. The appellant’s argument is that her PIAWE, which is calculated according to her earnings during the 52 weeks prior to the injury in 2002, should be adjusted twice each year so that her rights and entitlements to weekly compensation from 1 January 2013 would be greater because her PIAWE was higher. That cannot be said to have an effect on the appellant’s past rights or entitlements. The appellant’s reliance on cl 13 of Part 19H of Sch 6 to the 1987 Act is of no assistance. The fact that the amendments encapsulated in s 39 of the 1987 Act are not to be applied retrospectively to the receipt of weekly payments prior to the 2012 amendments does not mean that because there is no such clause in relation to s 82A, s 82A is to be read retrospectively. The presumption is that an enactment has prospective operation.”

22. The last sentence included a footnote to the judgment of Fullagar J in Fisher v Hebburn Ltd (1960) 105 CLR 188 at 194; [1960] HCA 80. It is instructive to consider the whole of the relevant passage. His Honour said:

“There can be no doubt that the general rule is that an amending enactment - or, for that matter, any enactment - is prima facie to be construed as having a prospective operation only. That is to say, it is prima facie to be construed as not attaching new legal consequences to facts or events which occurred before its commencement. The rule has been frequently applied to amending statutes relating to workers’ compensation, and it has often been held that such amendments apply only in respect of ‘accidents’ or ‘injuries’ occurring after their coming into force: the cases of Moakes v Blackwell Colliery Co Ltd (1925) 2 KB 64 and Kraljevich v Lake View and Star Ltd [1945] HCA 29; (1945) 70 CLR 647 are familiar examples. But there is no rule of law that such statutes must be so construed, and it would not be true to say that a retrospective effect can only be avoided by confining the operation of such a statute to subsequently occurring ‘accidents’ or ‘injuries’. It may truly be said to operate prospectively only, although its prospect begins, so to speak, with some other event than accident or injury.”

23. With respect, the Deputy President’s remarks and the reference to Fisher v Hebburn reveal a misconception as to the appellant’s argument. The appellant does not propound a construction of s 82A that would attach new legal consequences to facts or events which occurred before its commencement. She does not seek to revisit weekly compensation payments received before 1 October 2012. She relies on s 82A operating in prospect (that is, after its commencement) to weekly compensation payments to which she became entitled after that date. The argument is not that the section should operate retrospectively but that the dollar amount “A” referred to in the expression being a percentage of historical earnings should be indexed historically.

24. The misconception appears to have carried through into the respondent’s argument in the appeal, where it was noted that there were long periods of time between 2002 and 1 October 2012 when no weekly payments were made in respect of the 2002 injury. Counsel for the respondent said: “I think it's important to raise that in terms of the practical aspects of this matter in that no weekly payments were actually made that could’ve been subject to any later indexation in 2002, if one's speaking of going back and having earlier review dates”. As already explained, the appellant does not seek to have any payment received before 1 October 2012 supplemented by indexation, nor could she. The transitional provisions in Sch 6 Pt 19H cl 3(2) of the 1987 Act make plain that the 2012 amendments have no application to compensation paid before 1 October 2012.

25. There was a second misconception which should also be dispelled. The respondent submitted that the indexation contemplated by s 82A is “not a rolling increase where if you didn’t get the indexation on your wage the previous year then you’re starting at the wrong place”. It was submitted that “nothing is being lost when this factor is applied by not having had indexation earlier on”. The submission was wrong. It is clear from the definition of “A” in the expression that the indexation process is iterative. The dollar amount “A” is defined as follows:

A is the amount of the worker's pre-injury average weekly earnings within the meaning of Division 2 or, if that amount has been varied in accordance with this section, that amount as last so varied (emphasis added)

26. That is hardly surprising. If one starts with a 2002 wage and freezes it for 10 years without indexation, it is obvious that the indexed amount in 2020 will be out of kilter with current wage rates.

Proper construction of s 82A

27. The critical question is whether, properly construed, s 82A provides for historical indexation, as contended by the appellant, or only prospective indexation (that is, indexation that commences only after the commencement of s 82A), as contended by the respondent. I have concluded that the appellant’s construction is correct, for the following reasons.

28. The appellant referred to the well-known principles of statutory construction stated in the decision of the High Court in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 at [69]-[70]. She relied in particular on the principle stated at [70]:

“Reconciling conflicting provisions will often require the court ‘to determine which is the leading provision and which the subordinate provision, and which must give way to the other’. Only by determining the hierarchy of the provisions will it be possible in many cases to give each provision the meaning which best gives effect to its purpose and language while maintaining the unity of the statutory scheme.” (citations omitted)

29. The appellant submitted that, prior to the 2012 amendments, the method of calculating weekly payments ensured that “currency was maintained” because a worker’s benefit was calculated by reference to probable earnings if uninjured, determined from time to time by reference to updated evidence as to what the worker would have been earning had their employment continued. Whether or not currency was ensured by that method, it certainly offered some safeguard against inflation. As already explained, the respondent’s construction of s 82A would offer no such safeguard because, in a case such as the present, it would determine future entitlements by reference to a historical wage frozen for a period without indexation.

30. Be that as it may, the inquiry as to which construction is to be preferred must begin with a consideration of the statutory text. The appellant identified s 82A(1) as the “leading provision” (invoking the principle stated in Project Blue Sky at [70]) and submitted that s 82A(4) is subordinate to that provision, being merely mechanical or procedural. The text of s 82A(1) supports that analysis: the amount of a weekly payment “is to be varied on each review date after the day on which the worker became entitled to weekly payments in respect of that injury”. Subsection 82A(1) is capable of having effect on its own terms. As noted by the appellant, the number to be declared by the Authority in accordance with subs 82A(4) is determined in accordance with the expression set out in subs 82A(1). There is no element of discretion or the exercise of any judgment or choice on the part of the Authority in declaring the relevant number.

31. That is not to say that the task imposed on the Authority under subs 82A(4) is otiose. On the contrary, there is real utility in requiring the Authority to perform and publish the relevant calculation as a convenient reference for the industry.

32. The appellant further submitted that any failure by the Authority to do what the statute requires cannot inform the true construction of the Act. That is undoubtedly correct in this country. If on its proper construction the section permits historical indexation, the fact that the Authority has not in fact declared the number that equates to the factor for any review date before the commencement of the 2012 amendments would not alter that construction; it would simply mean the Authority had failed to fulfil its duty under the statute.

33. It may be noted in this context that, both before and after the commencement of the 2012 amendments, the statute contemplated and addressed the possibility that, for whatever reason, the Authority might fail to publish the relevant number by the required date. Section 82(2) of the Act as it stood before 1 October 2012 provided that an adjustment under the section was “not affected by any failure (including a failure that occurred before the commencement of this subsection) to publish the notice referred to in subsection (1)”.

34. Section 82A(5) instead operates as a deeming provision:

A declaration made by an order published on the NSW legislation website after a review date for the purposes of the variation required for that review date under this section has effect as if the order were published before that review date.

35. Without overemphasising its importance, that provision at least indicates that historical indexation is not inconsistent with or prohibited by s 82A.

36. Interestingly, the Arbitrator found support for the respondent’s argument in s 82A(5) (“If the publication had no force and was only an easy reckoner, then there would be no need to provide that the order could be backdated”: at [40]). While that is a logical analysis, its force is undermined by the fact that s 82 of the Act as it stood before 1 October 2012 also ensured that the late publication of the relevant factor would not affect the validity of the adjustment.

37. The respondent framed the central issue for determination as follows:

“whether, as a matter of construction, s 82A(1) of the 1987 Act can be applied by indexation prior to 1 April 2013 when there is no declaration by the Minister nor notice by the Authority published under s 82A(4) of a number that equates to the factor for a review date prior to 1 April 2013.”

38. As indicated by that formulation of the issue, the focus of the argument was subs 82A(4), which provides:

The Authority is to declare, by order published on the NSW legislation website on or before each review date, the number that equates to the factor .

39. The respondent refuted the proposition that that provision is merely procedural. It submitted that the appellant’s argument overlooks an important principle of construction also stated in Project Blue Sky that a court construing a statutory provision must strive to give meaning to every word in the provision. The respondent placed emphasis on the words “is to” in s 82A(4), which it submitted impose a duty on the Authority to declare and therefore “fix” the number that equates to factor . The respondent also relied on the tense of those words, which are “forward-looking”. I accept that is a textual indication that provides some support for the respondent’s argument, but it is not determinative. I do not agree that the construction contended for by the appellant leaves no work for subs 82A(4). As already noted, although the factor can be objectively ascertained, there is real utility in having it calculated and published by the Authority.

40. The respondent also emphasised the requirement that the Authority’s order be published on the NSW legislation website. That was relied upon as a textual indication that the order has the force of a statutory rule, having regard to the provisions of ss 39 and 45C of the Interpretation Act 1987 (NSW).

41. Senior counsel for the respondent submitted that, if the argument as to the published number being in the nature of delegated legislation is correct, it follows from the fact that there is no number that equates to the factor for any review date before April 2013 that the appellant cannot receive a weekly payment calculated in the manner for which she contends. While she maintained otherwise, in my view there is an element of question-begging in that submission. It may equally be argued that, if subs 82A(1) gives effect to the relevant calculation of its own force, the fact that there is no number that equates to the factor for any review date before April 2013 is of no consequence.

42. The respondent also drew attention to the principle stated in Cooper Brookes(Wollongong) Pty Ltd v Commissioner of Taxation (Cth) (1981) 147 CLR 297 at 305; [1981] HCA 26 per Gibbs CJ that:

“if the language of a statutory provision is clear and unambiguous, and is consistent and harmonious with the other provisions of the enactment, and can be intelligibly applied to the subject matter with which it deals, it must be given its ordinary and grammatical meaning, even if it leads to a result that may seem inconvenient and unjust.”

43. The respondent submitted, citing Cooper Brookes at 305, that “the danger that lies in departing from the ordinary meaning of an unambiguous provision is that ‘it may degrade into mere judicial criticism of the propriety of acts of the legislature.’” That is an important caution to be kept in mind but I do not accept that the premise is established in this case.

44. The respondent submitted in that context that the legislative intention of the 2012 amendments included “cost savings”, meaning that some provisions were not beneficial to workers: ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1; [2014] HCA 18 at [28]-[29] (French CJ, Crennan, Kiefel and Keane JJ). The respondent submitted that a court must give effect to this legislative intention notwithstanding any detrimental impact it may have on workers, citing Cram Fluid Power Pty Ltd v Green [2015] NSWCA 250 at [122].

45. Neither of those decisions can determine the question raised by the present appeal. It is, with respect, not helpful to start from the premise that the legislation is beneficial, or “cost-saving”. Further, I do not see how the construction contended for by the respondent saves costs (as opposed to reducing compensation). But in any event, the critical question is what the section means.

46. The respondent also sought to rely on the Second Reading Speech to the 2018 amendments to s 82A introduced by the Workers Compensation Legislation Amendment Act 2018 (NSW). The effect of those amendments was to replace the Authority for the Minister as the entity responsible for publication of the number that equates to the factor . I do not see how that material can assist in the construction of the amendments introduced in 2012.

47. Finally, the respondent submitted that there is no provision in s 82A to permit a construction that the weekly benefit is calculable without the number that equates to the factor under subs 82A(4). It was submitted “had the legislature intended that section 82A(1) of the 1987 Act could be applied without the published number that equates to the factor , it could and would have made such an express provision or else would not have included s 82A(4) at all.” I disagree. As already indicated, I would construe subs 82A(1) as being capable of giving effect to the relevant adjustment of its own force, with or without the undoubted practical benefit of having the required factor calculated by the Authority.

48. For those reasons I propose the following orders:

1. Allow the appeal.

2. Set aside the judgment of the court below.

3. Remit the matter to the Workers Compensation Commission to be determined according to law.

4. That the respondent pay the appellant’s costs.

49. GARLING J: As the judgment of McCallum JA shows, the principal issue which the parties put before this Court for decision was the proper construction of s 82A of the Workers Compensation Act 1987 (“the 1987 Act”), in particular, whether indexation of weekly compensation payments could be calculated from a time before the section was introduced on 1 October 2012 by the Workers Compensation Legislation Amendment Act 2012.

50. I agree with Her Honour’s judgment that the Deputy President of the Workers Compensation Commission fell into error in concluding that the section did not permit a calculation by reference to indexation which commenced at any time prior to 1 October 2012. I also agree with the orders which Her Honour proposes for the determination of this appeal.

51. A consequence of the way in which the Deputy President (and the Arbitrator) approached this central issue was that neither made a factual finding which is essential to the application of the indexing provisions in s 82A. That essential fact which needed to be determined in order to enable the application of the indexing provisions in s 82A was the “day on which the worker became entitled to weekly payments in respect of that injury …”. It will be convenient to refer to this as “the relevant day”.

52. The Appellant’s claim was one of some factual complexity and so the determination of the relevant day which was not the subject of agreement between the parties had to be proved by the appellant and made the subject of an explicit finding.

53. The appellant had whilst employed by the respondent suffered three separate injuries. The first occurred on 29 June 2001 when she injured her back during a back-care course at TAFE as a part of the training provided by the respondent. She took some time off work because of her injury, although whether she received any weekly compensation at that time is not clear.

54. Her second injury occurred on 23 December 2002. She was punched in the face and jaw when welcoming a client at the centre where she was working for the respondent. She sustained injuries to her face, jaw, teeth and neck. The appellant told Dr James Bodel, by whom she was examined in March 2019, that she was put off work for a week, and then returned to work “on suitable duties”. This matter was not addressed by the appellant in her statement which accompanied her application in the Workers Compensation Commission.

55. It seems clear that the appellant’s neck injury was not promptly diagnosed, and she has recently, 28 May 2019, come to surgery by way of anterior discectomy and cervical spine fusion. In this judgment, it will be convenient to refer to this injury as the subject injury, as the appeal only refers to the claim for compensation by the appellant arising from this injury.

56. The appellant’s third injury occurred on 21 May 2004. The factual circumstances of this injury do not appear in the material before this Court. However, the injury involved was apparently, according to the Certificate of an Approved Medical Specialist, Dr Murray Hyde-Page, dated 18 June 2008 (as recorded in the decision of a Medical Appeal Panel of 16 February 2009), to the appellant’s back in the area of the lumbar spine. I infer that this was the only injury suffered in the third incident, as the referral to the AMS only involved an assessment of the lumbar spine referable to that injury, whereas the same reference to the AMS for the subject injury, referred to the cervical spine, and the “ear, nose, throat and related structures”.

57. The appellant first gave notice of the subject injury to GIO, which was the insurer responsible for dealing with claims against the respondent, by a Claim Form dated 17 November 2003. The form does not include any claim for any payments of weekly compensation in respect of the week the appellant apparently did not work. In a statement which formed a part of the material considered by both the Arbitrator, and the Deputy President, the appellant makes no reference to whether she had any, and if so which, periods off work as a result of the subject injury during the time of her employment with the respondent which seems to have ceased in 2004, or perhaps, early in 2005.

58. During oral submissions on the appeal, senior counsel for the respondent drew attention to three payments of weekly compensation which the GIO records note were made to the appellant prior to 1 October 2012. They are recorded as being payments for the period 24 May 2004 to 7 June 2004 with respect to “Total Incapacity s 36”. As 21 May 2004, the day of the third injury was a Friday, I would infer that these were payments commencing on the following working day, namely Monday 24 May 2004. Although the payments appear in the records of compensation paid by GIO relating to the subject injury, there seems to be room to consider that these payments in fact relate to incapacity arising from the third injury which was sustained at the end of the previous week.

59. Notwithstanding this possibility, senior counsel for the respondent, in her oral submissions to the Court, accepted, in reliance upon those payment records, that the appellant became entitled to weekly payments, within the meaning of s 82A, on 24 May 2004, which was the date upon which she was incapacitated and unable to attend at her usual place of work.

60. The position of the appellant with respect to the relevant date seems to have varied throughout the course of the proceedings before the Workers Compensation Commission and in this Court.

61. The appellant submitted to the Arbitrator that the indexation calculated in accordance with s 82A ought to commence from 1 April 2003, because that was the first review date after the relevant date. The factual basis for this submission was not identified, and no finding was made by the Arbitrator. The submission is consistent with a contention that because the appellant had a week where she was unfit for work (although she did not claim and apparently did not receive any payment of weekly compensation) that fixed the relevant date in December 2002. It is also consistent with the submission advanced on appeal that the relevant date for the purposes of s 82A is the date upon which the injury occurred. It is not clear which of these alternatives was being relied upon.

62. The records of payment of weekly compensation of the GIO show that the next payment after 2004 of weekly compensation was for the period commencing 13 December 2013. The evidence suggested that the appellant had been in receipt of weekly compensation for a lengthy period prior to December 2013, arising from an incapacity relating to her back arising from the first and third injuries. Again, it is not clear when, or in what circumstances, those payments ceased. However, the Arbitrator accepted that the appellant did not receive any payments of weekly compensation relating to the subject injury in the period between 5 November 2004 and 13 December 2013. These were the dates contained in a letter from GIO provided to him. There is no material which enables a determination of what occurred with respect to the payment of weekly compensation relating to the subject injury between 7 June 2004 and 5 November 2004.

49. The Deputy President recorded that the appellant received weekly payments of compensation from June 2004, although she did specify when the payments ceased. This accords with the payment records of the GIO. However, the Deputy President noted that the only issue in the proceedings before her was whether the indexation should be calculated “ … from the date [the appellant] commenced receiving weekly payments (on the applicant’s case the year 2002), or from 1 April 2013 which was the first review date … after s82A was introduced into the 1987 Act”. This suggests that the Deputy President did not automatically equate the receipt of weekly compensation in June 2004 with the relevant date for the purposes of the application of s 82A. The Deputy President made no finding of fact which fixed the relevant date. No doubt that was because she held that the statutory interpretation of s 82A favoured by the Arbitrator was the correct one.

50. In the course of his oral submissions on the appeal, senior counsel for the appellant, sought to rely upon an earlier decision of this Court: Bresmac Pty Ltd v Starr (1992) 29 NSWLR 318, in support of a submission that the relevant date for the purposes of s 82A was the date on which the appellant was injured – 23 December 2002, regardless of when she first was incapacitated for work, or else received any payment of weekly compensation. His alternate submission was that the appellant became so entitled when by reason of an incapacity for work, she did not work, and so became entitled to make a claim for weekly compensation payments. He submitted that the actual date of payment by an insurer of weekly benefits could not alone determine the entitlement of the injured worker to weekly payments.

51. I am unpersuaded by the appellant’s submissions that the decision in Bresmac is authority for the proposition that the relevant day in s 82A is always the date of injury.

52. First, Bresmac was a decision which dealt with a lump-sum entitlement for permanent impairment under s 66 of the 1987 Act, which was in significantly different terms to the provisions of s 33 of the 1987 Act which deals with entitlement to weekly payments. An entitlement to lump-sum compensation in accordance with s 66 is determined by the existence of a permanent impairment resulting from the injury. Whilst the assessment of the extent of that permanent impairment may not be made until a later time, the entitlement to compensation derives from the injury and its effects.

53. Secondly, s 33 which is the relevant provision dealing with a worker’s entitlement to payments of weekly compensation is in these terms:

33   Weekly compensation during total or partial incapacity for work

If total or partial incapacity for work results from an injury, the compensation payable by the employer under this Act to the injured worker shall include a weekly payment during the incapacity.

68. As can be seen, s 33 requires the existence of an incapacity for work before the employer is obliged to pay (and the worker is entitled to receive) a weekly payment of compensation. An injury may, or may not, give rise to an incapacity for work at the time, or on the day, when it occurs. The essence of s 33 is that weekly payments are made if, and when, there is an incapacity for work, not just because an injury or a permanent impairment has occurred.

69. This approach accords with the judgment of Brereton JA (with whom White JA generally agreed) in Hochbaum v RSM Building Services Pty Ltd; Whitton v Technical and Further Education Commission t/as TAFE NSW [2020] NSWCA 113 at [64], where His Honour said:

“In other words, entitlement to weekly payments is always dependent on there being a deficit in work capacity. Impairment and incapacity are different concepts. Impairment does not necessarily equate to incapacity, and absent incapacity there is no entitlement to weekly payments.”

70. As the relevant date for s 82A is not always the date of injury, although in many cases it may well be because there is an incapacity immediately consequent upon the injury, a factual determination needs to be made of the relevant date so as to enable the correct application of the indexation calculation in s 82A.

71. In this appeal, the issue of the relevant date has real and significant consequences to the indexation calculation. If incapacity is established at the time immediately following the subject injury, then the first review date for the purposes of s 82A will be 1 April 2003.

72. If an incapacity is established by the payments of compensation made for the period commencing 24 May 2004 because they relate to the subject injury and not to the third injury, then the first review date will be 1 October 2004. Alternatively, if the relevant incapacity of the appellant is only established by reference to the payments of compensation commencing on 13 December 2013, then the first review date will be 1 April 2014.

73. The determination of the relevant date for the purposes of the application of s 82A will be a matter for proof when the proceedings are determined by the Workers Compensation Commission as required by the orders disposing of this appeal.

74. *****

Decision last updated: 02 February 2021