Van Ramer Pty Limited trading as Bathurst Funeral and Cremation Services v Higgins

[1992] HCATrans 171

~ ~~

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No SlS0 of 1991

B e t w e e n -

VAN RAMER PTY LIMITED trading

as BATHURST FUNERAL AND

CREMATION SERVICES

Applicant

and

CHARLES JOSEPH HIGGINS

.Respondent

Application for special leave

to appeal

MASON CJ

TOOHEY J

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McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 5 JUNE 1992, AT 10.50 AM

Copyright in the High Court of Australia

MR R.S. HULME, QC:  If the Court pleases, I appear with my

learned friend, MR P.J. DEAKIN, QC, and

MR J.O. TANCRED, for the applicant. (instructed by

Hickson, Lakeman & Holcombe)

MR B.J. GROSS, QC:  May it please the Court, I appear with

MR M.G. CUMMINGS, for the respondent. (instructed

by McIntosh, McPhillamy & Co)

MASON CJ: Yes, Mr Hulme?

MR HULME:  Your Honour, we would urge that this matter

falls within both subsection (a)(i) and

subsection (b) of section 35A, as raising a matter

of public importance, one of general application

and one which the court should entertain in the

interests of the administration of justice.

The decision of the Court of Appeal was based

on a section of the 1926 Workers' Compensation Act

which, though it has been repealed, has been

replaced in the 1987 Act by a section which, so far

as is material, raises the same problems. The

section also has its brothers in the workers'

compensation legislation of other States and the

same question arises under some of that

legislation.

Could I hand to the Court five copies of a

bundle of documents, the first page of which is a
page which was missing from the appeal book, the

second page of which, however, sets out a

comparison between the Act as it was considered by

the court in this case and the current Act, with a

view to showing to the Court or demonstrating the

similarity and that the question has not gone away

merely because of the repeal of the 1926 Act.

TOOHEY J: Where does that first page find its place in the

application book, Mr Hulme?

MR HULME:  I think it is between pages 51 and 52,

Your Honour, I might be wrong.

MCHUGH J:  I have 51A in mine.

MR HULME: It has been replaced.

MASON CJ: Yes, you have drawn our attention to this

document that sets out -

MR HULME:  A little further into the bundle, Your Honour,

about four pages further on we have set out

extracts from legislation in other jurisdictions,

that of the Commonwealth Employees' Rehabilitation

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Compensation Act and the Victorian legislation

being the most obviously in similar terms.

The other matter, by way of introduction,

which we would raise is that we caused inquiries to

be made and while the Court will be aware that

circumstances where there are more than two
discrete, or rather injuries occur on more than one

occasion, are a frequent occurrence in the workers'

compensation jurisdiction. Inquiries we have made

suggest that over a third of the applications there

involve what might be called two incidents, be it

two or more injuries, and thus we would submit,

with respect, that the broad factual situation
which we are here concerned with is one which
obviously applies in a wide variety of

circumstances.

If I might turn then to the decision of the

Court of Appeal itself, or rather the majority, the

effect of the decision is to hold that, for the

purposes at least of this legislation, an injury

which at common law would be regarded as causally

related to a particular event is for the purpose of

this legislation not to be so treated, and one has

to look in the case of a particular injury whether

that injury was at that time the subject of a

than in the simple words of section 63(1), the old negligent act on the part of the employer, rather negligence" et cetera, of the employer.

If I could just take the Court to the one

passage in the judgment of Mr Justice Handley, at
page 60 of the application book, the matter is, we

would suggest, made clear, reading at the top of

. the page:

The worker could proceed under the Act in

respect of the second injury.	He could and
did claim that the second injury "was caused

by the •.. negligence ... of the employer" in

the sense that it was a result of the first

injury.

And then His Honour goes on to introduce a test

which is just not borne out by the terms of the

legislation .

Now, His Honour recognized, I think on the

next page, that what he was deciding could cause

practical difficulties, and we submit that what

His Honour failed to do was to recognize, firstly,

how great they are, a fact which would argue

against his construction and, secondly, that his

decision was not required by the plain words of

section 63(1) which involved a simple test easily

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administered in future cases - in future

proceedings - by a particular employer, namely,

whether an injury was causally related or caused by

the personal negligence.

Now, could I just give a couple of

illustrations of the anomalies which are created by

the decision. If an intervening incident which exacerbated the condition of an employee, if it was, for example, a medical operation the

consequences of which were causally related to an

injury, it is clear, with respect, that whatever

compensation might have been awarded in respect of

that would be brought into account in the

assessment of the common law damages, and if the

plaintiff had included in his common law damages

moneys on account of that medical condition, for

example in Migge's case, in which Your Honour

Mr Justice Mason's judgment in the Court of Appeal

was upheld in the High Court, then, clearly, the
worker would be barred from recovering workers'

compensation arising, doubling up as it were, on

those damages.

What this judgment does is to say that if the

supervening event is work related, rather than

something not work related, then section 63(2) does

not apply. It leads to the situation where workers

will be doubly compensated for their injuries. It

is a common situation, as the Court would realize,

that many conditions, the subject of common law

damages, continue and the common law damages will

include an amount for the further incapacity likely

to ensure as a result of the injury. So, in that situation, the common law damages, the worker is,

as -it were, rewarded or compensated in anticipation

of the incapacity he is going to have in the

future.

Now, what this decision does is to say, "Well, be that as it may, those damages having been

awarded, nevertheless if the subsequent incapacity

manifests itself in a work related injury, the

employer can then receive compensation in the

future".

McHUGH J:  I take it it would not be appropriate in

assessing damages in respect of the accident that

gave rise to the negligence action to have regard

to compensation that would be payable in respect of

the aggravation caused by the second incident?

MR HULME:  It would involve the common law courts in doing

something which, so far as we are aware, has not

yet been done in any case, and that is to turn

their mind to the question of whether the

incapacity in the future, the further deterioration

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in the back or in a joint or whatever it is, is

going to occur or manifest itself in a work

environment, when there may be compensation, or in

a non-work environment when there would be no

compensation.

A common law court in assessing the damages is

going to have to, if this judgment stands, address

that question because if it was to occur in a

non-work related environment then there will be no

future workers' compensation. If it occurs in a

work related environment and this judgment stands,

then the court would say, "Well, he will get

compensation and we have to take some account of

that at this stage". And it leads to the further

situation which would be apparent in - - -

McHUGH J: But do you not have to face up to the estoppel

problem in this case? Whatever might be said in

favour of your argument on the construction of the

section, the fact is that Mr Justice Mahoney held

that you were estopped from arguing that the

worker's case was statute barred.

MR HULME:	Your Honour, can I come to that as a separate topic in just a moment, if I may?
MCHUGH J:	Yes .
MR HULME:	Another matter which will arise in a situation

such as here, for example, where the employee

succeeds on the basis that the first injury was

clearly caused by negligence, there is no need, in

that situation, to debate in the common law

proceedings whether the second injury was itself

the subject of negligence, but now that the

employee seeks compensation it would seem from

Mr Justice Handley's judgment that if we, the

employer, can demonstrate in the workers'

compensation jurisdiction that the second injury

was also attendant upon negligence on our part,

then section 63(2) is a defence to us down there.

The issue did not have to arise in the common

law proceedings but, on His Honour's construction,

if the second injury was the result of negligence,

then section 63(2) is a defence. So we have the

employer arguing before the Workers' Compensation

Tribunal the question of negligence attended upon

the second injury. ·

Now, previously, on the construction which we

advance, there is a very simple test. One looks at

the common law proceedings to look at what the

reasons for judgment were, or possibly what the

pleadings were also, and say, "Well, now, has the

employee recovered compensation in respect of the

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injury, it being on the basis that it was causally

related to the negligence of the employer.

Your Honour, we would submit, with respect, that

within the words of section 63(1) just looked on

its own, clearly this injury was, as

Mr Justice Finlay held, and, therefore, that should

be an end to the matter.

Now, so far as the question of estoppel is

concerned, there are obviously very many facts

there which argue in favour of an estoppel. The

issue, so far as estoppel is concerned, is whether

the estoppel can operate against the statute.

McHUGH J:	It may not be a question of estoppel so much, what about abuse of process, that you should be
allowed to raise the defence in the Workers' Compensation Commission, having regard to what
happened at the earlier stage?
MR HULME:	Your Honour, the question would also arise

whether it is not an abuse of process for the court

to permit a situation to arise where the parties

can decide, contrary to the principles that have

applied for hundreds of years, leave the situation

where an injury is partly compensated for in common
law and partly compensated for in workers'

compensation, contrary to what we submit is the

clear intention of the statute that there shall not

be double dipping, as it were, and that when there

are common law damages awarded that is the end of

the matter, and the court system is not going to be

subsequently troubled with applications -

proceedings - which have already been the subject

of an assessment of damages.

McHUGH J: But the law provides many illustrations of courts

allowing statutes to be sidestepped with the

consent of the parties, statute of frauds, no

action shall be brought.

MR HULME:	Your Honour, the question in this case, so far as estoppel is concerned, is whether this statute is
one which the parties, as it were, can get round,
in other words, estoppel can operate in the face of
this statute and in the face of the principle over the years - - -

McHUGH J: It is a section designed for the benefit of the

employer - to protect the employer.

MR HULME:  No, it does a number of things, Your Honour, it

both protects the employer; it both protects the

employee, in the sense that it makes it clear that

he has the option, common law or workers'

compensation; it protects the court system, so

that if common law remedy is chosen then that is

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the end of further proceedings - further
applications to the court - arising out of the one
injury, so that we would submit, with respect, when

one has regard to that principle over the years the

finality of litigation, not letting parties keep

coming again to raise the same sorts of issues, that the court system has an important stake in what operation is to be given to the sort of

transaction which occurred in this case where,

effectively, one insurer loaded the other, if I can

put it that way, and also then loaded the court

system with another application.

Now, Your Honour, if, as I say this - and it

is hard to see how this situation can ever arise,

except in circumstances where there is the sort of

circumstances that occurred in this case, with some

collaboration between the employer and the employee

in the common law proceedings.

Now, our case, so far as estoppel is

concerned, is that the statute, the principles to

which I have adverted, are such that the parties

cannot of their own bat avoid it, and that is the

simple issue so far as estoppal is concerned,

Your Honour. Is this one of those cases where

parties can ignore the statute, or the statute of

frauds, the statute of limitations is one, or is

this one where there is an interest, in terms of

the social interest, in not having more litigation

than necessary, there are the interests of

competing insurers who are statutorily bound under

the Act, whether they are there or whether they are

not. So, there are those issues which arise,

Your Honour.

MASON CJ: Was this particular argument presented to the

Court of Appeal, that you could not have an

estoppel against the statute?

MR HULME:  Yes, Your Honour, and could not have an estoppel

against this statute.

MASON CJ: Yes.

MR HULME:  Yes, that was the argument on estoppal.

Your Honour, while I accept that in terms to

ultimately succeed in the litigation we have to, as

it were, win on both points, so the first one is

one which we would submit, with respect, is so

important in terms of the workers' compensation
generally that it is an occasion for the granting

of special leave.

McHUGH J:  It can only arise by consent of the parties, can

it not? It is a one-off case, is it not? I have

never heard of it before.

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MR HULME:	Your Honour, it is not necessarily a one-off case - it is not a one-off case - because it has
now led to the situation where any employee who is
left with potential for further incapacity, and who
recovers common law damages on that basis, whenever
there is a supervening injury or manifests itself in a work environment, can say, "Well, now there is
another injury at work; I want compensation".

I

McHUGH J: But he always can, can he not, if it occurs after

judgment? -

MR HULME:  We would submit that it is clear that he cannot

on the terms of the statute.	If he has recovered
damages for his ongoing back	condition which is
likely to interrupt his work

McHUGH J: But if he had a fresh incident, it is always, in

my experience in New South Wales, if there is a

fresh incident you can always bring another action

in the Workers' Compensation Commission.

MR HULME:	Your Honour, we would submit, with respect, that that flies in the teeth of section 63(1) if that
has happened. If he has been compensated - - -

McHUGH J: It has taken 60 years for the lawyers to wake up to the point then because it used to happen fairly regularly in my time at the bar.

MR HULME:  If he has in fact been compensated at common law

damages, and then makes another application to

workers' compensation for the same problem - - -

McHUGH J:	He has to prove a new fresh injury that arose out of the course of his employment.	It has got to be
a post-judgment incident?

MR HULME: This was a pre-judgment one, of course

MCHUGH J: Yes.
MR HULME:	- - - incident, rather than that situation, so

that may distinguish it, Your Honour, but primarily

our submission would be, even in that situation if

that - - -

McHUGH J: But take the facts in this particular case, if he

injured his knee, the second knee after the

judgment, by reason of the instability of the knee

arising from the first injury, he would be entitled

to bring a claim, would he not?

MR HULME:  We would suggest not, Your Honour, and take a

simple case where, clearly, it was established

there was a likelihood that he would injure his

second knee, not that that happened, it was only a

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question of time, as the doctors often say. Now,

courts then awards him damages for that, has to

look at, if this judgment stands, the question of

whether that second injury is going to occur in a
work related environment or not because the amount he gets depends upon whether one allows the future

compensation under this judgment, if it occurs in a

work situation, or if it occurs outside a work

situation then no discount is made for the future

compensation. Now, that is a question which no

common law judge that I am conscious of has

addressed. Your Honour, it is a very

unsatisfactory situation to leave the common law

judge guessing how many hours he is going to have

at work, and what activities at work compared with

at home, and where is the future incapacity going

to manifest itself, and that is what is left here.

Your Honour, the only other matter that

perhaps I should mention is, in the event that we

were successful, there are other proceedings in

which the worker is seeking to appeal against

Mr Justice Finlay's judgment, so that it is not

merely a case of the worker, necessarily, suffering

in the event that our appeal is allowed, there are

still those other proceedings there.

MASON CJ:  Is it appropriate that we should take this matter

aboard if there is an appeal against

Mr Justice Finlay's judgment outstanding?

MR HULME:  Your Honour, in the exercise of the discretion

whether to grant special leave, it seemed to us it

was appropriate for the Court to at least know that

there are other proceedings there.

MASON CJ: Yes, I am not in any way criticizing you for

informing us of that, indeed it is very much to

your credit that you have told us, but having told

us, is it not a factor that counts against the

grant of special leave?

MR HULME:	No, Your Honour, it counts, with respect, in our favour.	We seek to have this decision made in our
favour.	Now, that will relieve us of any liability

done in workers' compensation. It may be said in

that situation, "But that is unfair to the

employee, because had this point been taken then

his damages at common law would, presumably, have

been higher". All I seek to say is, whether they

will be higher or not is a matter which is still

held in the supreme court. That is as far as I

wanted to take it.

Your Honour, it is for those grounds that we

submit that both the decision below is either

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clearly wrong or attended by sufficient doubt, and

it is a matter of public importance.

MASON CJ: The Court will take a short adjournment in order

to consider the course it will take in this matter.

AT 11.17 AM SHORT ADJOURNMENT

UPON RESUMING AT 11.20 AM:

MASON CJ:  The Court need not trouble you, Mr Gross. Having

regard to the existence of the estoppal issue, in

addition to the question of construction of

section 63 of the Workers' Compensation Act 1926

(N.S.W.), the Court is not persuaded that the

actual decision of the Court of Appeal is attended

with sufficient doubt to justify the grant of

special leave to appeal.

The application is therefore refused.

MR GROSS:	We ask for costs?
MASON CJ:	You do not dispute that?
MR HULME:	No, Your Honour.
MASON CJ:	The application is refused with costs.

AT 11.21 AM THE MATTER WAS ADJOURNED SINE DIE

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