United Petroleum Pty Ltd v Victorian WorkCover Authority
[2011] VSC 570
•10 November 2011
| IN THE SUPREME COURT OF VICTORIA | Not Restricted |
AT MELBOURNE
COMMON LAW DIVISION
JUDICIAL REVIEW AND APPEALS LIST
BETWEEN
S CI 2011 01687
| UNITED PETROLEUM PTY LTD (ACN 085 779 255) and UNITED CARD SERVICES PTY LTD (ACN 120 422 442) | Plaintiffs |
| and | |
| VICTORIAN WORKCOVER AUTHORITY | Defendant |
AND BETWEEN
S CI 2011 04105
| EMU (AUS) PTY LTD (ACN 115 944 799) | Plaintiff |
| and | |
| VICTORIAN WORKCOVER AUTHORITY | Defendant |
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JUDGE: | OSBORN J | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 20 October 2011 | |
DATE OF JUDGMENT: | 10 November 2011 | |
CASE MAY BE CITED AS: | United Petroleum Pty Ltd & Anor v Victorian WorkCover Authority; Emu (Aus) Pty Ltd v Victorian WorkCover Authority | |
MEDIUM NEUTRAL CITATION: | [2011] VSC 570 | |
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ACCIDENT COMPENSATION – Statutory scheme for compulsory WorkCover insurance – Scheme requiring payment of premiums based upon categorisation of activity conducted at workplace – Nature of appeal from internal review of premium determination – Whether appeal by way of hearing de novo – Whether appeal limited to errors of fact or law – Question of statutory construction – Presumption that appeals from administrative decision-makers to courts are by way of hearing de novo – Historical context – Where court empowered to ‘make such order as it sees fit’ – Where internal review does not provide for a hearing – Where appeal includes appeal from deemed determinations – Appeal by way of hearing de novo – pt 2A, Accident Compensation (WorkCover Insurance) Act 1993 – Re Coldham; Ex parte Brideson [No 2] (1990) 170 CLR 267 - Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd (1976) 135 CLR 616---
APPEARANCES: | Counsel | Solicitors |
| For United Petroleum Pty Ltd and United Card Services Pty Ltd | Mr R P Gorton QC and Mr I McDonald | Clayton Utz |
| For Emu (Aus) Pty Ltd | Mr S Stuckey | Arnold Bloch Leibler |
| For the Defendant | Mr D Collins SC and Ms R L Enbom | Corrs Chambers Westgarth |
TABLE OF CONTENTS
A The provisions of the Act........................................................................................................... 5
B Principles of construction......................................................................................................... 10
C Historical context........................................................................................................................ 15
C The terms of s 36J....................................................................................................................... 19
D The nature of the hearing granted.......................................................................................... 21
E The nature of the internal review............................................................................................ 25
F The basis of the internal review.............................................................................................. 26
G An application for internal review may not result in an assessment on the merits..... 27
H The terms of and context created by the privative clause.................................................. 27
I The requirement to pay the premium upfront...................................................................... 28
J The potential for abuse of the appeal right............................................................................ 29
K Other matters.............................................................................................................................. 29
L Conclusion................................................................................................................................... 30
HIS HONOUR:
The premiums for WorkCover insurance are fixed by a formula which requires the categorisation of the predominant activity undertaken at a workplace by way of a ‘WorkCover Industry Classification’.
The relevant characterisation may involve a choice between two or more categories in respect of which the premiums differ by very substantial amounts. The task of characterisation is a question of fact governed by the application of the relevant classification to the circumstances in issue.
The appellants (‘the employer’) in the two proceedings before me seek to challenge the premiums they have been required to pay on grounds relating to the categorisation of the predominant activity at particular workplaces.
The Accident Compensation (WorkCover Insurance) Act 1993 (‘the Act’) provides an employer with a right to seek internal review of premiums fixed and notified by the Victorian WorkCover Authority (‘the Authority’) as payable in respect of a WorkCover insurance policy (‘WCIP’).
In turn, there is a right of appeal from the outcome of the internal review to this Court pursuant to s 36J of the Act. There is a threshold dispute in the present proceedings as to the nature of the appeal right. The employer contends that it is an appeal by way of hearing de novo, whilst the Authority contends that it is either an appeal on questions of law only, or, at best, an appeal on questions of law and fact limited to reconsideration of the material that was before the Authority at the time of the internal review. These reasons address the following preliminary question:
Whether the plaintiff’s appeal under s 36J of the Accident Compensation (WorkCover Insurance) Act 1993 (Vic) is, as the plaintiff contends, by way of hearing de novo or whether it is a hearing of a different kind.
In my opinion, the appeal is one by way of hearing de novo. That is, a fresh hearing. In summary, my reasons for that conclusion are as follows.
First, there is a general presumption that appeals from an administrative decision maker are appeals by way of hearing de novo unless the statute indicates otherwise.
Secondly, the background to the Act supports the conclusion that an appeal was intended to be one addressing the merits. Prior to the implementation of the statutory scheme, this Court had jurisdiction to assess on the merits the analogous question which arose in respect of compulsory insurance policies. Further, the report of Mr Hanks QC (‘the Hanks Report’) which formed the background to the current legislation recommended rights of appeal which embraced a merits appeal. Both these considerations tend to support the view that an appeal by way of hearing de novo was intended.
Thirdly, the right of appeal granted by s 36J of the Act is not expressed to be one on questions of law only and is founded simply upon the making of a determination by way of internal review with which the employer is aggrieved or, alternatively, upon a decision by the Authority not to conduct an internal review.
Fourthly, the terms in which the right to a hearing of an appeal is granted before the Court are as follows:
On the hearing of an appeal by the Supreme Court, the Court may make any order it thinks fit and may by order confirm, reduce, increase or vary the premium.
These words convey the broadest of discretions in relation to the powers of the Court. They do not provide that the Court may make ‘such determination as ought to have been made’. The phrase ‘may make any order it thinks fit’ supports the view that the Court is intended to exercise the discretion anew.
Fifthly, the internal review for which the Act provides is a review by a party having a direct interest in the outcome adverse to that of the employer. It is accompanied by no right to a hearing. It is unlikely that Parliament intended that there be no independent merits review of questions materially affecting the employer’s rights unaccompanied by the right to a hearing.
Sixthly, the basis of the internal review is not limited to matters placed before the Authority by the employer, but may extend to investigations of historical information, an inspection of the workplace and other investigations of relevant evidence. It is unlikely that Parliament intended that such a procedure be determinative of the employer’s rights without independent merits review.
Seventhly, the scheme of the Act contemplates that a matter may come to this Court when there has been no internal review of the merits by the Authority, either because:
(a) it has determined not to undertake a review under the Act; or
(b) it has failed to determine a review within the time provided for by the Act and is deemed to have made a decision adverse to the employer.
Likewise, no reasons are required to be given for either of these outcomes (in contrast to the requirement for reasons for a determination otherwise imposed by s 36F(6)). This category of matters subject to appeal suggests that it is intended that there be a full appeal on the merits. Employers falling within this category would otherwise potentially be left with no review of the merits and no reasons for the outcome the subject of the appeal. Conversely, they would be precluded from agitating the merits, either by way of a claim for money had and received, or by way of a defence to a claim for premium.
Eighthly, there is a privative clause within the Act which seeks to limit the employer’s rights of appeal and review to those provided under the Act. The proceedings contemplated as being brought under the relevant part of the Act are broadly defined to include:
(a)the inquiry into, hearing and determination of any question or matter under this Act[1]
These words are apt to embrace an appeal on the merits by hearing de novo and, conversely, prevent the merits of an employer’s objection being agitated by a defence to a claim for a premium or by a claim for money had and received. The privative clause creates a critical context in which the other relevant provisions of the Act fall to be assessed.
[1]Section 32. Compare s 22A.
Ninthly, the employer is required to pay the premium initially assessed by the Authority by the date specified in the relevant notice of premium. The subsequent appeal rights do not prejudice the Authority’s commercial position. The Authority is entitled to recover and retain the premium unless and until the Court determines otherwise.
Tenthly, I accept that, as the Authority submits, it may seem anomalous that an employer who makes a deficient application for internal review which the Authority declines to determine as misconceived or lacking in substance[2] should have a right of appeal on the merits on fresh material. Nevertheless, there is no sensible reason why an employer should delay in putting its substantive case, given that it is required to pay its premium pending the appeal outcome and the internal review procedure offers the possibility of an expeditious and cheap outcome. Material contained in the Hanks Report also indicates that Parliament had before it evidence relating to analogous appeal rights demonstrating that as at the date of the passage of the legislation, it was believed that the vast majority of appeals would be prosecuted and resolved by way of applications for internal review.
[2]Section 36B(1)(b).
I will next turn to a more detailed examination of the provisions of the Act before elaborating my reasoning.
A The provisions of the Act
Section 7 of the Act provides for compulsory WorkCover insurance. It imposes an obligation upon an employer of workers within the meaning of the Accident Compensation Act 1985 to obtain and keep in force a WCIP with the Authority.
By s 9, such a WCIP must contain only the provisions prescribed by the Act. By s 10, only the Authority may issue a WCIP.
The premiums payable under a WCIP are calculated in accordance with a premium order made by the Governor in Council on the recommendation of the Authority.[3]
[3]Sections 15-17.
The Authority may serve a notice of premium on a employer pursuant to s 17A.
Provision is made for estimates of the rateable remuneration paid by the employer during the relevant period and for the review of such estimates and adjustment of premiums where appropriate.[4]
[4]Sections 18-21.
Provision is also made for applications for refund of premiums.[5]
[5]Sections 22A-B.
Section 26 provides:
26 Payment of premiums
(1)The premium payable by an employer for a WorkCover insurance policy is payable in accordance with the relevant premiums order.
[sub-ss (2) and (3) repealed]
(4)The Authority may, by notice in writing to the employer, adjust the amount of the premium so that the amount is the amount calculated in accordance with the relevant premiums order.
Part 2A provides for premium review. It contains the provisions in issue in this case and which were introduced into the Act in 2010. Section 33 enables an employer to apply under pt 2A for internal review of premiums imposed by the Authority.[6] Section 34 requires the payment of the premium pending review and imposes late payment penalty interest.[7]
[6]It also provides for application to review default penalties and future claim costs.
[7]Section 34(3).
Section 35 is a privative clause in the following terms:
35 Review only as permitted under this Act
Proceedings in respect of any question concerning a notice of premium or purported premium or the amount of premium payable or purportedly payable by an employer must not be brought, whether against the Authority or otherwise except as provided in this Part.
‘Proceedings’ are broadly defined by s 32 as follows:
proceedings includes—
(a)the inquiry into, hearing and determination of any question or matter under this Act;
(b)seeking the grant of any relief or remedy in the nature of certiorari, prohibition, mandamus or quo warranto, or the grant of a declaration of right or an injunction;
(c) seeking any order under the Administrative Law Act 1978;
(d) any other action or proceeding.
The Authority submits that the effect of these provisions is to render Part 2A a code governing disputes over premiums. I doubt s 35 could exclude the supervisory jurisdiction of the Court with respect to jurisdictional error,[8] but subject to this proviso I accept this submission.
[8]Kirk v Industrial Court (NSW) (2010) 239 CLR 531; South Australia v Totani (2010) 242 CLR 1; S157/2002 v Commonwealth (2003) 211 CLR 476.
Section 36 provides for the making of applications for review:
(1)An application for review made under section 33(1) must—
(a)be in writing in a form approved by the Authority; and
(b)state the grounds for review; and
(c)attach any document relevant for the purposes of the review; and
(d)unless section 36A applies, be lodged with the Authority within 60 days—
(i)after the date of service of the notice that is the subject of the application; or
(ii)in the case of an application in respect of an estimated future claim cost, after the Authority has notified the employer of an estimated future claim cost.
Section 36A enables the Authority to permit applications for review to be lodged out of time.
Section 36B permits the Authority to decline to conduct a review in certain cases:
(1)The Authority may decline to conduct a review under this Part if—
(a)the application made under section 33 is in respect of matters that have been reviewed by the Authority on a prior occasion and the employer—
(i)has been provided with the Authority's written reasons for the decision following that review; and
(ii)has not provided the Authority with any new, relevant information in or with the application for review; or
(b)the Authority considers that the application made under section 33 is misconceived or lacking in substance.
(2)If the Authority declines to conduct a review under subsection (1), the Authority must notify the employer of the Authority's decision, in writing, within 28 days of receiving the application under section 33.
Section 36D fixes the time period for review and refers expressly to a power to conduct inspections:
(1)Subject to sections 36B and 36E, the Authority must conduct a review of an application made in accordance with section 36 within 90 days of receipt of the application.
(2)The period specified in subsection (1) may be extended—
(a)by agreement between the Authority and the employer; or
(b)to allow the Authority to conduct an inspection.
Section 36E enables the Authority to require information and suspend the review. Section 36E(1) specifically provides:
(1)The Authority may, by written notice, request an employer to provide information relevant to the review to the Authority within the time specified in the notice.
Section 36F provides for the determination of the review. Section 36F(1) provides:
(1)The Authority must, after reviewing an application under section 33—
(a)confirm the premium, default penalty or estimated future claim cost; or
(b)adjust the premium, default penalty or estimated future claim cost.
Section 36F(6) provides:
(6)The Authority may, in making a determination under this section, consider any relevant information.
In my view, this subsection, read in conjunction with the other provisions I have referred to, makes it clear that the Authority may consider the information it regards as relevant and ascertain such information, either by requesting it (s 36E(1)), or upon inspection (s 36D(2)(b)), or, by implication, by reference to historical documentation (s 36B(1)) or any other relevant source.
I do not accept that there is a distinction between the material which the Authority may consider in reviewing an application and that which it may consider in making its determination, as was at one point submitted by the Authority. Such a distinction would substantially rob s 36F(6) of practical effect.
In turn, s 36F(7) and (8) provide, first, for the giving of notice of a determination of a review and, secondly, for the giving of reasons in the notice to the employer for the determination made.
Section 36I provides for deemed decisions by the Authority:
36I Deemed decisions of the Authority
(1)Subject to subsection (2), if the Authority does not issue, within 90 days of receiving an application by an employer under section 33—
(a)a determination made by the Authority under section 36F; or
(b)a notice under section 36B; or
(c)a notice of suspension under section 36E—
the Authority is deemed to have made a determination under section 36F to confirm the premium, default penalty or estimated future claim cost.
(2)If the period for review by the Authority has been extended under section 36D(2) and at the end of that extended period the Authority does not issue a determination or notice specified in subsection (1)(a), (b) or (c), the Authority is deemed to have made a determination under section 36F to confirm the premium, default penalty or estimated future claim cost.
Section 36J then conveys the appeal right now in issue:
36J Appeals
(1)Despite anything to the contrary in section 39(1) of the Accident Compensation Act 1985, if an employer—
(a)is not satisfied with a determination made by the Authority under section 36F (including a deemed determination under section 36I); or
(b)has received notice that the Authority has decided not to conduct a review under section 36B—
the employer may appeal against that determination or decision to the Supreme Court.
(2)An appeal under subsection (1), other than an appeal made in respect of a deemed determination under section 36I, must be made within 60 days of the employer receiving notice of the Authority's determination or decision.
(3)An appeal made in respect of a deemed determination under section 36I must be made within 60 days of the determination being deemed to have been made.
Section 36K governs the hearing of appeals:
36K Hearing of appeal by Supreme Court
(1)On the hearing of an appeal by the Supreme Court, the Court may make any order it thinks fit and may by order confirm, reduce, increase or vary the premium.
(2)The costs of an appeal are in the discretion of the Supreme Court.
B Principles of construction
The statutory scheme falls to be construed on the basis of the purposive approach embodied in s 35(a) of the Interpretation of Legislation Act 1984 (Vic)[9] and in accordance with the principles stated by the High Court. In CIC Insurance Ltd v. Bankstown Football Club Ltd, Brennan CJ, Dawson J, Toohey J and Gummow J stated:[10]
It is well settled that at common law, apart from any reliance upon s 15AB of the Acts Interpretation Act1901 (Cth), the court may have regard to reports of law reform bodies to ascertain the mischief which a statute is intended to cure. Moreover, the modern approach to statutory interpretation (a) insists that the context be considered in the first instance, not merely at some later stage when ambiguity might be thought to arise, and (b) uses ‘context’ in its widest sense to include such things as the existing state of the law and the mischief which, by legitimate means such as those just mentioned, one may discern the statute was intended to remedy. Instances of general words in a statute being so constrained by their context are numerous. In particular, as McHugh JA pointed out in Isherwood v Butler Pollnow Pty Ltd, if the apparently plain words of a provision are read in the light of the mischief which the statute was designed to overcome and of the objects of the legislation, they may wear a very different appearance. Further, inconvenience or improbability of result may assist the court in preferring to the literal meaning an alternative construction which, by the steps identified above, is reasonably open and more closely conforms to the legislative intent.
[9]‘In the interpretation of a provision of an Act or subordinate instrument—
(a)a construction that would promote the purpose or object underlying the Act or subordinate instrument (whether or not that purpose or object is expressly stated in the Act or subordinate instrument) shall be preferred to a construction that would not promote that purpose or object …’
[10](1995) 187 CLR 384, 408 (citations omitted).
In Project Blue Sky Inc v Australian Broadcasting Authority, McHugh, Gummow, Kirby and Hayne JJ stated:[11]
The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined ‘by reference to the language of the instrument viewed as a whole’. In Commissioner for Railways (NSW) v Agalianos, Dixon CJ pointed out that ‘the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed’. Thus, the process of construction must always begin by examining the context of the provision that is being construed.
A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals. Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purpose and language of those provisions while maintaining the unity of all the statutory provisions. 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.
Furthermore, a court construing a statutory provision must strive to give meaning to every word of the provision. In The Commonwealth v Baume Griffith CJ cited R v Berchet to support the proposition that it was ‘a known rule in the interpretation of Statutes that such a sense is to be made upon the whole as that no clause, sentence, or word shall prove superfluous, void, or insignificant, if by any other construction they may all be made useful and pertinent’.
[11](1998) 194 CLR 355, 381-382 (citations omitted).
As observed by Gleeson CJ in Singh v Commonwealth, the historical context provides assistance in the ascertainment of meaning: [12]
Meaning is always influenced, and sometimes controlled, by context. The context might include time, place, and any other circumstance that could rationally assist understanding of meaning.
[12](2004) 222 CLR 322, 332; see also 335-6.
In Tasty Chicks Pty Limited & Ors v Chief Commissioner of State Revenue,[13] the High Court considered the right of a taxpayer to apply to the Supreme Court of New South Wales for a ‘review’ if dissatisfied with the determination by the Chief Commissioner of State Revenue of its objection to a payroll tax assessment. The statutory scheme contemplated that the Chief Commissioner would first determine objections to an initial assessment and that, except as provided by the statutory review process, no court or tribunal had ‘jurisdiction or power’ to consider any question concerning the Chief Commissioner’s determination. The High Court observed that ‘an appeal’ from an administrative decision to a court is the creature of statute and confers original, not appellate, jurisdiction.[14] The Court further stated:
… where a jurisdiction called an ‘appeal’ is enlivened, it is essential to identify its nature and the duties and power of the court in the exercise of that jurisdiction. The term ‘review’ presents similar considerations. It takes its meaning from the context in which it appears. It may be used by the statute in question to empower decision-making by an administrative body, or to confer a species of original jurisdiction on a court. If the latter, again it will be necessary to identify the nature of the ‘review’ and the duties and powers of the court in the exercise of that jurisdiction.[15]
[13][2011] HCA 41.
[14]Ibid, [5].
[15]Ibid, [5] (citations omitted).
The term ‘appeal’ may be used in a number of different ways. In Dwyer v Calco Timbers Pty Ltd,[16] the High Court referred to the classification of appeals adopted by Mason J in Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd:[17]
(i) an appeal stricto sensu, where the issue is whether the judgment below was right on the material before the trial court; (ii) an appeal by rehearing on the evidence before the trial court; (iii) an appeal by way of rehearing on that evidence supplemented by such further evidence as the appellate court admits under a statutory power to do so; and (iv) an appeal by way of a hearing de novo.
[16](2008) 234 CLR 124.
[17]Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd (1976) 135 CLR 616, 619–622 (‘Sperway’), cited in Dwyer v Calco Timbers Pty Ltd (2008) 234 CLR 124, 128 [2]; see also Turnbull v New South Wales Medical Board [1976] 2 NSWLR 281, 297–298 per Glass JA.
The Court went on to note that:
But these categories cannot represent a closed class and particular legislative measures, such as those with which this appeal is concerned, may use the term ‘appeal’ to identify a wholly novel procedure or one which is a variant of one or more of those just described.[18]
[18]Dwyer v Calco Timbers Pty Ltd (2008) 234 CLR 124, 128 [2].
In relation to determining the meaning of ‘appeal’ in a given context, in Eastman v The Queen, McHugh J stated: [19]
Which of these meanings the term ‘appeal’ has depends on the context of the term, the history of the legislation, the surrounding circumstances, and sometimes an express direction as to what the nature of the appeal is to be.
[19](2000) 203 CLR 1, 40-41 (citations omitted).
In Re Coldham; Ex parte Brideson [No 2], Deane, Gaudron and McHugh JJ stated that: [20]
[I]t is well settled that, when the legislature gives a court the power to review or hear an ‘appeal’ against the decision of an administrative body, a presumption arises that the court is to exercise original jurisdiction and to determine the matter on the evidence and law applicable as at the date of the curial proceedings.
[20]Re Coldham; Ex parte Brideson [No 2] (1990) 170 CLR 267, 270 (‘Brideson [No 2]’), citing Ex parte Australian Sporting Club Ltd; Re Dash (1947) 47 SR (NSW) 283.
In Sperway,[21] Mason J stated with respect to an appeal by way of rehearing:
Where a right of appeal is given to a court from a decision of an administrative authority, a provision that the appeal is to be by way of rehearing generally means that the court will undertake a hearing de novo, although there is no absolute rule to this effect. Despite some suggestion in argument to the contrary, I do not read Ex parte Australian Sporting Club Ltd.; Re Dash as enunciating such an absolute rule. There are, of course, sound reasons for thinking that in many cases an appeal to a court from an administrative authority will necessarily entail a hearing de novo and I exclude for present purposes the case of an appeal to a federal court exercising the judicial power of the Commonwealth under Ch. III of the Commonwealth Constitution. The nature of the proceeding before the administrative authority may be of such a character as to lead to the conclusion that it was not intended that the court was to be confined to the materials before the authority. There may be no provision for a hearing at first instance or for a record to be made of what takes place there. The authority may not be bound to apply the rules of evidence or the issues which arise may be non-justiciable. Again, the authority may not be required to furnish reasons for its decision. In all these cases there may be ground for saying that an appeal calls for an exercise of original jurisdiction or for a hearing de novo.
On the other hand the character of the function undertaken by the administrative authority in arriving at its decision may differ markedly from the instances already supposed. The authority may be required to determine justiciable issues formulated in advance; to conduct a hearing, at which the parties may be represented by barristers and solicitors, involving the giving of oral evidence on oath which is subject to cross-examination; to keep a transcript record; to apply the rules of evidence; and to give reasons for its determination. In such a case a direction that the appeal is to be by way of rehearing may well assume a different significance.
But in the end the answer will depend on an examination of the legislative provisions rather than upon an endeavour to classify the administrative authority as one which is entrusted with an executive or quasi-judicial function, classifications which are too general to be of decisive assistance. Primarily it is a question of elucidating the legislative intent, a question which in the circumstances of this case is not greatly illuminated by the Delphic utterance that the appeal is by way of rehearing.[22] I accept the Authority’s submission that the presumption that appeals from administrative bodies are to be by way of hearing de novo is not an absolute one. While the determination of the nature of the appeal right conferred is ultimately a matter of statutory construction, nevertheless the presumption and, more generally, the characteristics of the body appealed from identified by Mason J are both relevant considerations.
[21]Sperway, 621.
[22]Sperway, 621-2 (citations omitted).
In Clarke & Walker Pty Ltd v Secretary Department of Industrial Relations,[23] Kirby P stated:
(c) Appeals to courts: Where an appeal is provided from an administrative body to a court, it may be more readily inferred that the court should not be confined to the materials that were before the authority: Builders Licensing Board v Sperway Constructions (Syd) Pty Ltd (at 621). Doubtless this presumption arises, in part at least, from a disinclination to confine courts, with their superior status and fact finding facilities, to the material gathered by an administrator, sometimes lacking the techniques, and often the coercive powers, which courts find useful in the elucidation of disputed issues before them. In the present case, the Secretary urged that, where an appeal is from one administrative body to another, no such presumption will exist. This is more doubtful. Conceding that in every case the task is that of elucidating the legislative meaning, a facility of appeal from a senior administrative officer to a statutory tribunal suggests a change in the quality of decision making: the one being private and evaluative in nature, the other being public and adjudicative.[24]
[23](1985) 3 NSWLR 685.
[24]Ibid, 692.
Glass JA, with whom Hope JA agreed, also referred to Sperway and relied specifically upon the fact that the proceeding before the administrative authority resulting in the decision from which the relevant right of appeal lay exhibited all the features described in Sperway[25] as leading to the conclusion that it was not intended that the Court be confined to the materials before the authority.[26]
[25]Sperway, 621.
[26]Clarke & Walker Pty Ltd v Secretary Department of Industrial Relations (1985) 3 NSWLR 685, 698.
I accept the Authority’s submission that the presumption that appeals from administrative bodies are to be by way of hearing de novo is not an absolute one. While the determination of the nature of the appeal right conferred is ultimately a matter of statutory construction, nevertheless the presumption and, more generally, the characteristics of the body appealed from identified by Mason J in Sperway are both relevant considerations.
C Historical context
Part 2A of the Act was inserted as part of a series of amendments effected by the Accident Compensation Act 2010. These amendments followed the publication of the Hanks Report.
Immediately prior to the 2010 reforms to the Act, there was no statutory mechanism for the resolution of a dispute concerning the premium payable by an employer. Disputes about premiums were resolved by the Court in actions brought at common law and, in limited circumstances, by way of judicial review.[27]
[27]See eg SBA Foods Pty Ltd v VWA [2001] VSC 276.
In Victorian WorkCover Authority v IR Cootes,[28] the employer had brought a common law action for moneys had and received, after having paid ‘adjusted’ insurance premiums to the Authority under protest. The Court found in favour of the employer and the Authority appealed. Each member of the Court of Appeal considered the role of the Court in disputes as to the determination of the premium payable and implicitly accepted that the Court’s role at first instance was to examine for itself the relevant evidence in order to determine the correct classification.[29] Whilst Charles JA found that the onus fell on the employer to show that the classification of the workplace for the purpose of the premium was incorrect,[30] his Honour did not suggest that the Court was not entitled to conduct its own assessment of the evidence. The decision incidentally demonstrates that the question of characterisation of the land use for the purpose of classification was treated as one of fact although it may involve questions of degree upon which minds might differ.
[28][2001] VSCA 85 (‘IR Cootes’).
[29]Ibid, [13]-[14], per Winneke ACJ; [53]-[58], per Phillips JA; and [93], per Charles JA.
[30]Ibid, [81].
Similarly, in Somerville Retail Services Pty Ltd v Victorian WorkCover Authority,[31] the Authority had brought proceedings seeking payment of premiums and penalties allegedly payable to it. The defendant employer pleaded that the Authority had improperly characterised the predominant activity at its workplace. The trial judge considered that the key issue was the appropriate description of the predominant activity at the employer’s workplace. After hearing evidence from both parties, the trial judge concluded that the Authority’s characterisation of the predominant activity was correct. On appeal, the employer failed to demonstrate material error in the trial judge’s conclusion and the appeal was dismissed.
[31][2011] VSCA 166 (‘Somerville Retail Services’).
For a period after 1985 and up until the abolition of the Accident Compensation Tribunal, the issue of characterisation of predominant activity was the subject of appeal to the Accident Compensation Tribunal and, in turn, an appeal to this Court on questions of law.[32]
[32]ACC v John Valves Pty Ltd (1993) 2 VR 10; Chandlers Personnel Group Pty Ltd v ACC (1993) 2 VR 1.
The Hanks Report criticised the lack of a legislative merits review process for disputes concerning premiums. The Report recommended the implementation of a new, comprehensive premium objection and review process:
In my view, it is unsatisfactory that the legislation does not prescribe the process for an employer to initiate an independent review of the merits of the VWA’s premium determination, and I consider that there should be transparent and robust mechanisms to appeal against decisions made by the VWA. I favour:
·A formal internal VWA premium review process which aims to provide a non-adversarial system for the prompt and low-cost resolution of premium disputes; and
·A codified premium dispute resolution system with the ability for employers to have recourse to independent review (for example, VCAT, the Magistrates’ Court or the Supreme Court), based on the model for Victorian State taxes.
…
The independent review would be available to employers through two alternative routes:
·a merits review by an independent body, such as VCAT or the Magistrates’ Court, with decisions appellable to a court, such as the Supreme Court, on questions of law only; or
·a review on questions of fact or law to the Supreme Court.[33]
[33]Peter Hanks QC, Accident Compensation Act Review, Final Report (2008), 11.201-11.203. (‘Hanks Report’).
The Hanks Report outlined the proposed model diagrammatically:
The Hanks Report considered that the proposed two-stage review process would lead to most disputes being resolved internally without recourse to external review. Mr Hanks stated:
If my proposed model is implemented, I would expect that most disputes would be resolved by the VWA internal review process. Similar review mechanisms for inspectors’ activities under the OHS Act have resulted in relatively few appeals to VCAT. There were 686 requests for a review of a health and safety inspectors’ decisions during 2006/2007; only seven people were not satisfied with the outcome of the review performed by the WorkSafe Internal Review Unit and sought external review by VCAT.[34]
[34]Hanks Report, 11.206.
The document entitled ‘Government Response to Hanks Report‘, released following the Government’s receipt of the Hanks Report, indicated that the response to the recommendations regarding premium review was ‘support with modification’. The accompanying commentary stated:
The Government supports Hanks’ recommendation that a formal internal review process be introduced for review of premium determinations.
However, the Government considers that the appropriate jurisdiction for external review (or appeal of decisions) is the Supreme Court as this will ensure a high level of rigour.
I do not read this as indicating an intention there should be no merits review of the Authority’s decision.
The Second Reading Speech made when the Accident Compensation Amendment Bill 2009 was introduced into Parliament further stated:
Specifically, this bill delivers:
…
a transparent and robust mechanism for review of premium decisions.
…
This bill will introduce changes to improve accountability and transparency in the premium process to make the system fairer and simpler. It creates a process for review of aspects of premium calculation via WorkSafe and the Supreme Court. The process is broadly based on the model for internal review of taxation decisions that has been tested and works well.[35]
[35]Victoria, Parliamentary Debates, Legislative Assembly, 10 December 2009, 4615-4626 (Tim Holding, Minister for Finance, WorkCover and the Transport Accident Commission) (emphasis in original).
I do not accept the Authority’s submission that the terms of s 36J indicate an intention on the part of Parliament to adopt only the ‘appeal’ (as opposed to ‘review and appeal’) procedure recommended by the Hanks Report. The context as a whole supports the view that Parliament intended that there would be a hearing de novo, giving the Supreme Court the power to conduct the independent merits review recommended by the Hanks Report and not simply the residual right of appeal on questions of fact and law. This is the nature of the jurisdiction which was exercised historically by this Court in relation to common law claims with respect to the liability to pay premiums of the type in issue. It is also the type of appeal which the background material relating to the current legislation favours as an essential element of the appeal process.
C The terms of s 36J
Section 36J is not expressed in terms which restrict the employer’s right of appeal to one on questions of law.
Such a right was commonly utilised in respect of appeals from inferior tribunals to this Court at the date of the passage of the Act. In such cases, the relevant legislation specified and restricted the type of appeal in issue.[36]
[36]Eg s 148 Victorian Civil and Administrative Tribunal Act, s 109 Magistrates’ Court Act, s 272 Criminal Procedure Act.
In each instance, the right of appeal was from the decision of a tribunal before which there was a right to a hearing and an obligation to give reasons. A similar regime applied to questions such as those now in issue during the period when such issues were the subject of a right of review before the Accident Compensation Tribunal.
Thus, in ACC v John Valves Pty Ltd,[37] Valves made an application to the ACC that its premises be treated as comprising more than one contiguous area of land within the meaning of the relevant legislation and that a different ‘predominant activity’ was undertaken in three different areas which it identified. The ACC rejected the application. Valves sought review of this decision before the Accident Compensation Tribunal pursuant to s 218 of the then provisions of the Accident Compensation Act 1985. The Tribunal reviewed the decision and resolved the matter in favour of Valves. In doing so, it exercised powers that enabled it to consider the matter entirely afresh. An appeal was then brought from the Tribunal’s determination to the Supreme Court pursuant to s 61(3) of the then Accident Compensation Act 1985 from a determination of the Tribunal ‘on a question of law raised during [the] proceedings’.
[37](1993) 2 VR 10.
Likewise, in Chandlers Personnel Group Pty Ltd v ACC,[38] Chandlers lodged an objection to the reclassification of the industry in which its establishment was categorised, a question which in turn depended on the predominant activity in which workers were engaged in that establishment. Chandlers’ objection was pursued before the Accident Compensation Tribunal on the merits and then in the Supreme Court on a question of law principally concerned with whether the Tribunal had misdirected itself on the meaning of ‘activity’ and ‘predominant activity’.
[38](1993) 2 VR 1.
The right of appeal granted by s 36J is in respect of both determinations and deemed determinations. It is not premised upon a requirement for an actual assessment and determination of the merits of the application upon internal review.
The words ‘may appeal against that determination or decision to the Supreme Court’ are broad and there are no words limiting that appeal to an appeal by way of rehearing in a limited form as distinct from a hearing de novo.[39] There is no limitation of the type which was imposed historically in respect of appeals from the Accident Compensation Tribunal to this Court.
[39]Cf Turnbull v New South Wales Medical Board (1976) 2 NSWLR 281, 285.
Nevertheless, I accept that the question raised by the application which is the subject of determination by the Authority defines the fundamental question for appeal. In these cases, that question is whether the workplaces in issue should be classified as the employer contends and not in accordance with the Authority’s determination.
D The nature of the hearing granted
Section 36K gives a power ‘on the hearing of an appeal’ for the Court to make any order it thinks fit.
I accept Mr Gorton’s submission that the literal expression of s 36K by reference to the hearing, rather than the determination of the appeal, tends to support the view that the Court has a broad power both as to the conduct of the hearing and its determination.
The grant of power is not limited to confirming or adjusting the premium as is the power exercisable on internal review.[40] It is not limited to dealing with the determination made by the Authority. It does not provide that the Court may make ‘such determination as ought to have been made’.[41]
[40]Applicants A1 and A2 v Brouwer & Anor (2007) 16 VR 612, 620 [29].
[41]Clarke & Walker Pty Ltd v Secretary Department of Industrial Relations (1985) 3 NSWLR 685, 695.
The power is expressed in terms which have been held to convey an intention that the appeal be by way of hearing de novo.
In Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission,[42] Gleeson CJ, Gaudron and Hayne JJ observed:
15The provision considered in Brideson [No 2] conferred power on the Commission to take further evidence, a provision which is indicative of an appeal by way of rehearing. It also required the Commission to ‘make such order as it [thought] fit’. The latter requirement indicated that the Commission's appellate powers were not constrained by the need to identify error on the part of the primary decision-maker, but, rather, that the Commission was obliged to give its own decision on the evidence before it.
16The terms of s 45 of the Act are different from the terms of the provision considered in Brideson [No 2]. Unlike that provision, s 45 does not require a Full Bench of the Commission to ‘make such order as it thinks fit’. Nor is there anything else in the terms of s 45 to suggest that the powers of a Full Bench are exercisable or, as in Brideson [No 2], are required to be exercised in the absence of error on the part of the primary decision-maker.[43]
[42](2000) 203 CLR 194. (‘Coal & Allied Operations’)
[43]Coal & Allied Operations, 204 [15] and [16].
In Brideson [No 2], the following power was conferred on the Australian Industrial Relations Commission:
Upon the determination of an appeal under this section by the Commission, the Commission shall make such order as it thinks fit and may confirm, quash or vary a decision of the Registrar appealed from.
Deane, Gaudron and McHugh JJ observed:[44]
The power conferred on the Commission to ‘make such order as it thinks fit’ together with the power to ‘take further evidence for the purposes of an appeal under this section’ are strong indications that the appeal given section 88F was by way of rehearing.
[44]Brideson [No 2], 272.
In the present case, there is no express power to take further evidence, but the terms of the decision-making power are expressed in language very similar to that considered by the Court in Brideson [No 2]. The power is to be interpreted in the manner explained in Coal & Allied Operations. The terms of the power indicate that the relevant appellate power is not constrained by the need to identify error on the part of the Authority, but rather that the Court is obliged to give its own decision on the evidence before it.
The Authority contended that even if the appeal is one by way of a fresh hearing, the employer would nevertheless be limited to relying upon the evidence that was before the Authority at first instance. In support of this view, counsel for the Authority pointed to the lack of an express power to admit fresh evidence. I do not accept this submission. The construction of the Act that I favour is one which entitles the employer to ventilate the matter anew before the Supreme Court exercising original jurisdiction upon the law and evidence applicable at the date of the hearing. The lack of independence of the decision-maker, the absence of a right to a hearing or opportunity to consider the evidence upon which the Authority makes its decision and the fact that the Authority is not bound by the laws of evidence are all considerations indicating that Parliament intended the Court to exercise original jurisdiction.[45] The grant of power in s 36K is broad. It is not necessary for the Court to be given an express power to admit further evidence. As was stated in Ex parte Currie; Re Dempsey:
Although a right to receive fresh evidence is usually expressly given, we do not think that it is necessary that such a right should expressly appear in the statute.[46]
[45]See eg Sperway, 621.
[46]Ex parte Currie; Re Dempsey (1968) 70 SR(NSW) 1, 10 per Jacobs and Holmes JJA.
It may further be observed that:
(a) Although the application for review is directed to matters which might be expected to be within the employer’s knowledge, the true issues between the parties may not be defined by the application itself, but by investigations made by the Authority and conclusions it draws from those investigations. Indeed, it is submitted that one of the matters before me is precisely such a case. It follows that if the employer was confined on appeal to matters contained in its application for internal review, it may not be able to confront matters central to the reasons for the Authority’s decision.
(b) Because neither the content of the application made to the Authority nor the material the Authority considers relevant are governed by the rules of evidence, it follows that when the matter comes before the Court both parties may need to better evidence matters which were the subject of informal and flexible administrative communication if they are to be accepted as facts.
(c) There may also be very real difficulties in defining what was and what was not in evidence before the Authority upon a view and/or during a process of administrative inquiry and investigation. It would be fundamentally unfair if the Authority could pick out some observations made by it upon a view or during some other investigation and rely on those, but the employer could not answer those observations by evidencing the whole of the context in which they were in fact made and/or necessary to their proper understanding.
(d) It may also be that the coercive powers of the Court enable the Authority to require the production of evidentiary material which it could not obtain when conducting the review but which is directly relevant to the matters in issue.
(e) The Authority’s position is particularly difficult to accept in cases of a want of procedural fairness. If the Court is limited to considering the evidence before the Authority at first instance on the merits, it is limited to the evidence produced by an unfair process. If, alternatively, the Court remits the matter for rehearing then it can only remit it to a decision maker that not only has a direct interest in the contested outcome but has already failed to deal with the employer fairly and which is not obliged to give the employer a hearing on further review of the application. Neither outcome is likely to have been intended by the legislature.
E The nature of the internal review
The internal review process provided for by the Act provides neither for review by an independent body, nor for a hearing. It follows that in a substantive sense the appeal to this Court cannot be a ‘rehearing’. There is no prior hearing.
The review is undertaken by the Authority, which itself has a direct financial interest in the outcome. It is commenced by way of written application by the employer, but there is no requirement that the employer be offered the opportunity to confront the Authority’s case. There is no requirement (prior to the giving of its reasons for determination of the review) for the Authority to identify for the employer the factual matters the Authority regards as relevant, the evidence the Authority proposes to rely on in respect of establishing those matters, or the process of reasoning by which the Authority proposes to characterise the relevant predominant activity.
Whilst it may well be that, as counsel for the Authority submits, the Authority must accord the employer procedural fairness,[47] the content of that obligation is unclear and it does not extend to a hearing.
[47]Cf SBA Foods, [224] following.
If the Authority’s submissions to this Court are accepted, the employer will have no opportunity to present a case on the merits to an independent tribunal, nor to answer the Authority’s case on the merits before such tribunal. It may be doubted that this was the intention of Parliament in respect of an issue involving legal liability for significant monetary amounts.
The Authority pointed to an incidental aspect of the procedure for internal review as being consistent with a limited right of review. This is that there is no right of appeal from a refusal by the Authority to extend time for an application for review.
Section 36A(4) provides:
Proceedings to seek review of a decision made by the Authority under this section to not grant permission to lodge an application out of time or to only grant permission to lodge out of time subject to conditions, must not be brought, whether against the Authority or otherwise.
It is unnecessary to determine the effect of this provision for present purposes. In my view, a limitation upon the scheme for extension of time cannot meaningfully inform conclusions as to the principal provisions governing the nature of internal review and subsequent appeal provided by the Act.
F The basis of the internal review
The internal review may take into account historical evidence available to the Authority. So much is demonstrated by s 36B(1)(b), which empowers the Authority to decline to conduct a review if, among other things, the employer has not provided the Authority with any new relevant information since a previous review in respect of which reasons were given for determination.
The Authority may also take into account observations on inspection of the relevant premises. Section 36D(2) expressly contemplates that the Authority may conduct an inspection.
Ultimately, the Authority may consider any relevant information.[48]
[48]Section 36F(6).
This context adds weight to the proposition that it is unlikely Parliament intended the employer have no hearing on the merits before an independent tribunal.
The evidentiary matrix upon which the Authority determines the review is for it to decide. The review is not confined to the documents submitted with the application for review. The Authority may identify and consider any matter relevant to the determination or calculation of the premium. It is not, however, required to give a hearing with respect to such matters. If the Authority’s submissions to this Court are accepted, it is only upon the hearing of an appeal to this Court that the employer will be able to fully confront the Authority’s case and it will be required to do so within the constraints of either an appeal on questions of law, or an appeal limited to a rehearing on errors of fact or law.
G An application for internal review may not result in an assessment on the merits
Section 33(2) provides that, on receiving an application for review of a premium, the Authority must either review the premium, or decide not to review the premium in accordance with pt 2A. In turn, s 36B provides that the Authority may decline to conduct a review, if either a previous review has been conducted in respect of which reasons for decision were provided and no fresh information has been provided with the application, or the Authority considers that the application is misconceived or lacking in substance.
Whilst this provides for a sensible administrative scheme, the provisions mean that a matter may come on appeal to this Court where there has in fact been no review of the evidence relating to the merits by the Authority.
Further, if an application for review is not determined within the time specified by the Act, the original decision of the Authority is deemed to have been confirmed.
This deeming occurs under a scheme within which, on its face, the privative clause contained in s 35 constrains the conventional remedies which would otherwise be available against an administrative body in respect of a failure to make a decision it was obliged to make.
This regime suggests that it is unlikely Parliament intended that there be no merits appeal before this Court. If the contrary view be taken, the procedure before the Authority may constitute no more than a preliminary administrative assessment of the matter, or a failure to review at all, whilst the consequential right of appeal would be constrained to demonstrating error of law or alternatively error of law or fact.
H The terms of and context created by the privative clause
Section 32 defines the term ‘proceedings’ for the purposes of s 35, which contains the privative clause. In consequence of that definition, the nature of proceedings in issue includes the enquiry into, and hearing and determination of any question or matter under the Act. It extends to ‘any other proceeding’ concerning a notice of premium or purported premium or the amount of premium payable or purportedly payable by an employer.
This definition may be compared with the definition of proceedings in ss 22A and 22B. These sections relate to proceedings for the refund or review of a premium within a specified time period. They define ‘proceedings’ as including:
(a) seeking the grant of any relief or remedy in the nature of certiorari, prohibition, mandamus or quo warranto, or the grant of a declaration of right or an injunction; and
(b) seeking any order under the Administrative Law Act 1978.
Although I accept that the point is not one of great weight in itself, it can be seen that the words used to define proceedings for the purposes of s 35 would embrace an appeal by hearing de novo ‘provided in this part’. Conversely, the privative clause would prevent the merits of the employer’s position being agitated by way of claim for money had and received,[49] or by way of defence to a claim for premium.[50]
[49]IR Cootes.
[50]Somerville Retail Services.
These contextual considerations inform the other matters I have identified.
I The requirement to pay the premium upfront
A merits review upon a hearing de novo does not prejudice the Authority by reason of potential delay in its resolution. Section 34 of the Act requires the premium to be paid upon notification and imposes penalty interest for non-payment.
The Hanks Report expressly sought to achieve this outcome.[51] The Report identified the need for a formal premium objection and review process:
Providing a formal premium objection and review process would remove any doubt that an employer is required to pay the employer’s premium, even if the amount is in dispute. Disputes will no longer be an excuse for the delaying payment.[52]
[51]Hanks Report 11.209-214.
[52]Hanks Report 11.213.
Any prejudice to the Authority which flows from the appeal process is minimised by s 34.
J The potential for abuse of the appeal right
Counsel for the Authority identified the possibility that an employer might lodge a deficient application for internal review, which would be rejected pursuant to s 36B(1). It was submitted that it would anomalous if the employer retained a right to prosecute a further and better case upon an appeal to this Court. Whilst I accept that this situation could hypothetically arise and that this would be an anomalous outcome of the construction for which the employer contends, I am not persuaded that the anomaly should determine the construction question. At the time of passage of the Act, Parliament had before it the Hanks Report, which I have quoted above and which pointed to the overwhelming preference for internal review under the Occupational Health and Safety Act.
The effect of the requirement to pay the premium upfront must be to encourage a proper and substantive application for internal review. In addition, the costs involved in seeking such a review will be materially less than in an appeal to this Court. The practical reality is that the anomalous course which the Authority hypothesises is unlikely to be attractive. I do not accept that the anomaly identified should be regarded as practically significant.
K Other matters
Considerable emphasis was placed in submissions on behalf of the Authority upon the proposition that the employer bears the onus of proof with respect to an application for internal review. I accept that in practical terms the employer must persuade the Authority if it is to succeed. Nevertheless, I doubt the applicability in strictness of the concept of onus of proof to a process where (a) the decision maker is the adversary party, (b) the rules of evidence do not apply, and (c) there is no hearing or other formal framework for evaluation of the evidence.
It was submitted on behalf of the Authority that the provisions of ch 2 of the Rules of the Supreme Court assisted in interpreting the Act. I do not accept this. It is one thing to have regard to a scheme regulated both by the Supreme Court Act and the Act giving rise to a right of appeal.[53] It is quite another thing to attempt to construe the Act by reference to the rules of Court. It is ultimately a matter for the Court to regulate its own procedures and its rules are necessarily flexible.
[53]Cf Tasty Chicks.
L Conclusion
For the above reasons, the better view is that the right of appeal to this Court is by way of hearing de novo and entitles the employer to a fresh hearing on the merits.
The answer to the preliminary question is that the plaintiffs’ appeals are by way of hearing de novo.
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