Tsimpinos v Allianz (Australia) Workers' Compensation (SA) Pty Ltd & Ors

[2005] HCATrans 429

[2005] HCATrans 429

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Adelaide  No A32 of 2004

B e t w e e n -

PETER TSIMPINOS

Applicant

and

ALLIANZ (AUSTRALIA) WORKERS’ COMPENSATION (SA) PTY LIMITED

First Respondent

WORKERS COMPENSATION TRIBUNAL

Second Respondent

ATTORNEY-GENERAL FOR THE STATE OF AUSTRALIA

Third Respondent

Application for special leave to appeal

GUMMOW J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

FROM ADELAIDE BY VIDEO LINK TO CANBERRA

ON FRIDAY, 17 JUNE 2005, AT 10.37 AM

Copyright in the High Court of Australia

__________________

MR N.W. MORCOMBE, QC:   May it please your Honours, I appear with MR A. ROSSI for the applicant.  (instructed by Moody Rossi & Co)

MR R.J. WHITINGTON, QC:   May it please your Honours, I appear with MR T.L. STANLEY for the first respondent.  (instructed by Gun & Davey)

GUMMOW J:   Yes, Mr Morcombe.

MR MORCOMBE:   Your Honours, this is an application for special leave as a result of a decision ‑ ‑ ‑

GUMMOW J:   I think there is no appearance for the second and third respondents, the State Attorney and the Tribunal.

MR MORCOMBE:   Yes, I am not expecting one, your Honour, and they are not here.

GUMMOW J:   Yes, Mr Morcombe, go on.

MR MORCOMBE:   This application is a result of a decision by the Full Court of South Australia when it determined that there was no jurisdiction in the Full Bench of the Tribunal.  The point turns on section 35(6a) and (6b) of the Workers Rehabilitation and Compensation Act.  In the respondent’s book of documents, in the first tab, your Honours will find a copy of the relevant sections.  If I could ask you to go to section 35, you will see that that is a section which in subsection (1) refers to the worker being “entitled to weekly payments”, and if you turn over then to subsection (6), you will see the provision that:

A worker is not entitled to receive for two or more disabilities weekly payments in excess –

et cetera, and then in (6a) and (6b) relevantly:

(6a)     If a liability to make weekly payments is redeemed –

then a presumption takes place.

(6b)     If a worker ceases to be entitled to weekly payments because –

of a certain matter, the presumption takes place.  In a nutshell, our case is that neither of those two conditions were met and therefore there was no place for the application of subsections (6a) and (6b) of the Act and that amounts to a jurisdictional error by the Full Bench of the Tribunal and by the Deputy President who heard it initially. 

Your Honours, whilst you have the Act there, can I take you to two other relevant sections.  First, to section 42.  Section 42 is in Division 4A and it deals with redemption and in subsection (1) it says that:

Any of the following liabilities may, by agreement between the worker and the Corporation, be redeemed by a capital payment to the worker –

and then there are three types of liabilities which may be redeemed.  That is:

(a)      a liability to make weekly payments;

(b)      a liability to pay compensation under section 32;

(c)      a liability to make a capital payment for loss of future earning capacity.

Can I say that section 35(6a) and (6b) do not make provision for the situation where there is an agreement under section 42(1)(b) and (c).  There is simply no provision in (6a) or (6b) for that circumstance.  I will take you to the agreement which was reached, but it is very clear on its face and all of the courts below proceeded on the basis that it was an agreement which redeemed a liability to make a capital payment for loss of future earning capacity under 42(1)(c). 

Your Honours, whilst we are on the Act, can I also ask you to look at section 42A which is in Division 4B.  Section 42A says that:

the Corporation may assess –

that is, the corporation may do this unilaterally, totally different from the agreement referred to back in section 42 –

the worker’s loss of future earning capacity as a capital loss.

(2)      In making the assessment –

certain principles are to be applied, and 42A(2)(b) deals with the case of partially incapacity:

the amount the worker could earn . . . will be projected forward over the remainder of the worker’s notional working life –

If I could just remind you that in section 35(6b) the condition precedent, if I may call it that, for the operation of the subsection is that:

If a worker ceases to be entitled to weekly payments because the Corporation makes a capital payment for loss of earning capacity under Division 4B –

It is silent on the question of 4A – it specifically mentions 4B – then the presumption kicks in.  So that under the totality of (6a) and ‑ ‑ ‑

GUMMOW J:   Which special leave question are you leading up to?

MR MORCOMBE:   Your Honours, can I say that my special leave point is somewhat narrower than would appear in the outline.

GUMMOW J:   Well, we had better know now.

MR MORCOMBE:   I am sorry?

GUMMOW J:   You had better tell us now.

MR MORCOMBE:   Yes.  We say that the Tribunal exceeded its jurisdiction in that it allowed the presumption to operate where the condition was not operative and that was one of the ‑ ‑ ‑

GUMMOW J:   Wait a minute.  Was this an argument put to the Full Court?

MR MORCOMBE:   I understand it was and even as far as Acting Deputy President Thompson refers to it in his reasons.

GUMMOW J:   We are worried about the Full Court.  Where did the Full Court deal with it?

MR MORCOMBE:   The decision of the Full Court commences at application book page 44 and at page 48, paragraph 23 his Honour Justice Debelle said:

The grounds relied on are as follows –

and in 3.1 and 3.2 – and those two points are related – his Honour set out the point that:

The Tribunal exceeded its jurisdiction in holding that the plaintiff and the defendant did, and were entitled in law to, exclude, modify or restrict the proper and effective operation . . . 

3.2      The Tribunal erred in holding that the agreement between the plaintiff . . . redeemed the defendant’s liability to make weekly payments to the plaintiff. 

That just is not the case.  It redeemed ‑ ‑ ‑

GUMMOW J:   Now, wait a minute.  This complaint then you now make does not seem to be reflected in your draft notice of appeal, does it?

MR MORCOMBE:   I think 5.1 covers it, your Honour.

GUMMOW J:   Yes, all right.  Go on.

MR MORCOMBE:   Thank you.  So the factual point was that there was an initial accident and, if I can put it in shorthand, there was then an agreement between the worker and the corporation and that agreement did not fit into the condition precedent set out in 35(6a) or (6b).  We say that in that circumstance there is a jurisdictional error by the Tribunal in allowing the presumption to take place. 

Now, can I make clear that we accept for the purposes of the application for special leave what the Chief Justice said in this State in the case of Craig v Workers Compensation last year which is also contained in your book of documents.  I do not ask you to go to it, but his Honour at paragraph 70 said:

The issue before this Court is the scope of the jurisdiction conferred on the Full Bench of the Tribunal.  My decision on that issue is influenced by the intermediate conclusion that it is a court, or a court-like body.

And I put these submissions on that basis.  Having done that, we say that what the Tribunal has done and the Full Court has refused to remedy is that the Full Bench of the Tribunal has exceeded its jurisdiction in terms of the decision in Craig of this Court in 1995 in that it has ‑ ‑ ‑

GUMMOW J:   Just explain to me in terms of the legislation again what the jurisdictional error is.  What is the boundary of jurisdiction to be found in the statute which you say was crossed?

MR MORCOMBE:   The two preconditions in (6a) and (6b), your Honour, in section 35.  That is, no liability to make weekly payments was redeemed – and that is clear from the redemption – and, similarly, the worker did not cease to be entitled to weekly payments because the corporation made a capital payment for loss of earning capacity under Division 4B.

GUMMOW J:   Where did Justice Debelle deal with this point?  You took us to page 48 where he outlined the grounds.  Where did he deal with this complaint?

CALLINAN J:   Paragraph 35 on page 52.

MR MORCOMBE:   Thank you, your Honour.  Where his Honour said that:

It appears to be that the Tribunal did not draw a distinction between sub-section (6a) and sub-section (6b) nor between a redemption under s 42 and an assessment under s 42A. 

In our submission, the failure to draw that distinction created the jurisdictional error.  The point is that under 42(1)(b) and (c) ‑ ‑ ‑

GUMMOW J:   Well, his Honour said these were not jurisdictional criteria.

MR MORCOMBE:   He did, and in that we say his Honour is wrong and he is wrong because of the High Court decision in Craig in 1995 which is within the book of documents. His Honour summarised the four grounds at pages 49 and 50 of the book.

GUMMOW J:   Craig was a case about larceny, was it not?

MR MORCOMBE:   It must be a different Craig, your Honour.  I am referring to the case of ‑ ‑ ‑

GUMMOW J:   Craig v South Australia in this Court?

MR MORCOMBE:   Yes, Craig v South Australia (1995) 184 CLR 163 where the majority, consisting of Justices ‑ ‑ ‑

GUMMOW J:  

A person charged in the District Court of South Australia with larceny . . . applied to a judge –

et cetera. 

MR MORCOMBE:   Yes, your Honour, that was a matter that went on appeal from the District Court of South Australia as a result of the application ‑ ‑ ‑

GUMMOW J:   All I am putting to you is it cannot shed any direct light on (6a) and (6b) of this Workers Rehabilitation statute.

MR MORCOMBE:   Not direct light, your Honour, what I ‑ ‑ ‑

CALLINAN J:   Do you have the right case or do you mean case No 6 in your book of authorities, which is a South Australian case, Craig v Workers Compensation Tribunal and Another?

MR MORCOMBE:   No, your Honour.  I am referring to the 1994‑1995 decision and his Honour has set out at the bottom of page 49:

In Craig at 177 the High Court defined four kinds of jurisdictional error ‑ ‑ ‑

GUMMOW J:   Yes, we know that, but paragraph 35 which Justice Callinan took you to turns upon a characterisation of (6a) and (6b).  That is a question of construction of this statute.  If you construe it one way, you get into the area of jurisdictional error.  If you construe it another way, as Justice Debelle did, you do not, and that seems to be the area of debate between you and your opponent, is that right?

MR MORCOMBE:   Well, I think that is right, yes.

GUMMOW J:   All right.  Well, you do not solve that question by looking at Craig.

MR MORCOMBE:   But what I am saying is that Craig sets out that failure to meet a precondition can invoke a jurisdictional error because ‑ ‑ ‑

GUMMOW J:   Of course it can, but the question is, is it the necessary sort of precondition of jurisdiction?  Justice Debelle said it was not.  That is what you have to meet.

MR MORCOMBE:   In my submission, until the precondition is met, there is no presumption to be applied.  That is my point.  That is the point.

CALLINAN J:   Yes, you are saying, in effect, that defined as his Honour did, that this case was within the exception provided for by section 35, denied your client a right to compensation that would otherwise be available under that section, is that right?

MR MORCOMBE:   Yes, your Honour.  It is our case that the Tribunal had no power, no jurisdiction to invoke the presumption until such time as the preconditions in 35(6a) and (6b) were met.  Now, I do not know that I can put it any better than that.  That is the point.

GUMMOW J:   Yes, thank you.  Yes, Mr Whitington.

MR WHITINGTON:   If the Court pleases.  I need perhaps to go back a little to the facts to make the position clearer.  The worker in this case suffered a work accident; he was in receipt of weekly payment of compensation.  Subsequently, much later, he suffered a second accident.  After he suffered the first accident, the corporation, as was its right, made an assessment of his entitlement to lump sum compensation.

GUMMOW J:   What section was that?

MR WHITINGTON:   Section 42A.

GUMMOW J:   Yes, we were taken to that.

MR WHITINGTON:   That was an assessment in the order of about $14,000.  Subsequent to that, the corporation and the worker entered into an agreement to redeem the liability to pay compensation, and that was an agreement that was entered into under section 42.  Such an agreement can redeem both the liability to make weekly payments and also a liability to pay a lump sum capacity payment.

GUMMOW J:   So it can operate then upon what has been done under 42A.

MR WHITINGTON:   It can, yes.  However, in this case the parties entered into a confused and obscure agreement.  The Court does not anywhere have it set out in full but part of the terms are set out in the applicant’s argument in application book 65 and on to 66.

GUMMOW J:   Yes.

MR WHITINGTON:   The agreement was confused in that on the one hand it purported to be a redemption agreement, but on the other hand it purported to acknowledge a liability to make a lump sum incapacity payment.  So it was a kind of hybrid and confused agreement that did not meet the requirements of the Act.  If I can leave that to one side for a moment.  When the worker suffered his second accident, under the legislation, particularly section 35(6a) and (6b), the worker could not receive full compensation; some allowance had to be made for the lump sum compensation he had already been paid. 

An argument was put by the worker that the Tribunal had to in some way amortise that lump sum payment and the worker proposed two solutions.  The worker said take the amount that the worker was receiving immediately prior to the agreement and divide that into the lump sum and you get a period of time.  That period of time is about three years.  After that, the worker’s entitlement to full compensation, weekly compensation, springs back.  The alternative approach the worker suggested was an actuarial one, which said that the lump sum payment for the first injury should be amortised over the assumed working life of the worker to age 65 at a particular discount rate, which meant that the worker should be deducted something like between $95 and $102 for the rest of his working life. 

Now, a question then for the Tribunal was, first of all, what to make of this agreement, which was a matter of fact and characterisation, and secondly, how to apply sections 35(6a) and/or (6b). 

GUMMOW J:   On the face of them, they are deeming provisions or presumptive provisions, “is taken” and “is presumed” – “is taken” in (6a) and “is presumed” in (6b).

MR WHITINGTON:   Yes.  What both the Tribunal at first instance and the Full Bench said about the deeming provision was that it was to be taken literally and it meant that the worker was to be deemed, having received a lump sum payment, to be in receipt of the weekly payments of compensation he was receiving immediately prior to the lump sum.  Now, there was a debate in the Tribunal about the appropriate amount, whether it was $282 or $275.  That was resolved as a matter of fact in evidence in the order of $275, but what the Tribunal held was that these sections meant the worker was deemed to be receiving that amount for all time and so for all time his entitlement to weekly payments for compensation for the second injury, which were in the order of $800 per week, had to be the subject of a deduction of about $275 on account of his lump sum payment.  Now that was a pure question of construction of the section which arose clearly within the court’s jurisdiction.

GUMMOW J:   Yes.  How did the Tribunal acquire jurisdiction in this dispute?  Is there some ‑ ‑ ‑

MR WHITINGTON:   There is a section 94.

GUMMOW J:   In Division 6?

MR WHITINGTON:   Yes.

GUMMOW J:  

The Tribunal must make a judicial determination of a disputed claim –

Was it (a) or (b)?  Was it referred or was there just ‑ ‑ ‑

MR WHITINGTON:   It was (a).  It was referred for judicial determination.

GUMMOW J:   I see.

MR WHITINGTON:   That then takes your Honour back to section 90:

(1)      A person with a direct interest in a reviewable decision (“the applicant”) may lodge a notice of dispute with the Registrar.

GUMMOW J:   Yes.  Well, the relevant jurisdiction is the existence of a disputed claim. 

MR WHITINGTON:   Precisely, your Honour.  Once that jurisdiction is attracted, then the Tribunal has to decide the quantum of the disputed claim by reference to the facts and circumstances, including in this case the obscure agreement, the evidence as to what the worker was receiving immediately prior to the lump sum payment, and the operation of sections 35(6a) and (6b) on that lump sum payment. 

The Tribunal at first instance and the Full Bench both held, in the ordinary application of those sections, that they had a particular effect for the worker.  The worker does not like the result, because the result meant that he was in effect to be deducted $275 from his otherwise entitlement to weekly compensation until the age of 65 when he was contending for a lesser period or a lesser amount.  So the worker does not like the result, but it is a result that was achieved by the Tribunal within its jurisdiction to resolve the dispute and it was a result that was achieved by applying the rules contained in section 35 to the facts as found. 

In those circumstances, in our respectful submission, the Full Court of the Supreme Court was plainly right to find that there was no excess or want of jurisdiction and to say that the matter could not be entertained by the Full Court under section 88I of the Act, which was the ‑ ‑ ‑

CALLINAN J:   Mr Whitington, was there power to make an order under the Judicial Review Act in the nature of certiorari?

MR WHITINGTON:   Your Honour will find the relevant section just near that part of the Act I took the Court to.  It is in section 88I in Part 6 Division 12.  Does your Honour have that?

CALLINAN J:   Not at the moment.

MR WHITINGTON:   It is in the respondent’s book of materials, your Honour, behind tab 1.  The Court will see it reads:

No proceeding, judgment or decision of the Tribunal can be challenged, appealed against, reviewed, quashed or called in question except –

(a)      as provided in this Act; or

(b)      in proceedings before the Full Supreme Court founded on an alleged excess or want of jurisdiction.

GUMMOW J:   Would that include certiorari for error of law on the face of the record?  Maybe not.

MR WHITINGTON:   That is in fact a difficult question, your Honour.  As your Honour knows, certiorari for error on the face of a record does not need to go to jurisdictional error.

GUMMOW J:   Yes, exactly.

MR WHITINGTON:   This arguably excludes certiorari for error on the face of the record; certainly in the case where it was error within jurisdiction as opposed to error that amounted to an excess or want of jurisdiction.

GUMMOW J:   But you say there was no error of law anyway.

MR WHITINGTON:   No.  Well, not on the face of the record, and certainly that has not ever been the point agitated below, so if that were now to be a consideration, it is not a consideration that has ever been raised by the applicant before and ‑ ‑ ‑

GUMMOW J:   I think the error that is pointed to is in the construction of (6a) and (6b) of section 35.

MR WHITINGTON:   Yes.

CALLINAN J:   If there is error in that regard, it is error of law on the face of the record, is it not?

MR WHITINGTON:   With respect, your Honour, that in terms of Craig’s Case begs the question, what is the record for these purposes?  That is not an issue that has been explored below because it was never agitated.

GUMMOW J:   Yes.

CALLINAN J:   The record certainly includes the reasons, does it not, the reasons of the Deputy President and ‑ ‑ ‑

MR WHITINGTON:   All I can say to that, your Honour, is it may do in some cases and it may not.  That requires an inquiry into the way in which the record of this particular court is affected.

CALLINAN J:   The agreement would be part of the record, would it not?

MR WHITINGTON:   No, I do not think so, with respect, your Honour.  The agreement was tendered in evidence and I doubt whether the evidence received at the hearings would be regarded as part of the record.  But I must say that is not a matter that has ever exercised anybody’s minds in this case because nobody suggested before that the relevant jurisdictional error was an error on the face of the record.

CALLINAN J:   Yes.

MR WHITINGTON:   They are our submissions, if the Court pleases.

GUMMOW J:   Yes, thank you, Mr Whitington.  Yes, Mr Morcombe.

MR MORCOMBE:   I have nothing in reply, your Honour.

GUMMOW J:   Having regard to the manner in which the case was argued and decided in the South Australian Full Court there are insufficient prospects of success in an appeal to this Court to warrant a grant of special leave.  Special leave is refused with costs.

AT 11.05 AM THE MATTER WAS CONCLUDED