WorkCover Corporation v Smith No. Scgrg-98-704 Judgment No. S6878

WORKCOVER CORPORATION v SMITH
[1998] SASC 6878

Full Court: Prior, Lander and Wicks JJ

PRIOR J

I agree that this appeal must be allowed for the reasons given by Lander J. I also agree with the orders he proposes.

LANDER J

This is an appeal from a decision of a Deputy President of the Workers Compensation Appeal Tribunal in which the learned Deputy President upheld an appeal from a Review Officer rejecting a claim by the dependants of a deceased worker for benefits under s44 of the Workers Rehabilitation and Compensation Act 1986 (the Act). The appellant’s right to appeal to this Court was preserved, notwithstanding the repeal of s100 of the Act. Leave to appeal was required and obtained. The appeal, under the repealed s100, is limited to a question of law (s100(3)).
The parties to the appeal agreed the facts upon which the decision of the Review Officer and the decision on appeal by the Deputy President were based.
I set out the statement of agreed facts.
“1..... John Maxwell Keating (“Keating”) died on 25th July 1995 at Ampol Roadhouse at Pinnaroo in the State of South Australia.
2...... Keating died as a result of dissection of the ascending aorta which tracted proximally and ruptured into the pericardium.
3...... The disability causing Keating’s death was not a secondary disability or a disease but an injury that did arise out of or in the course of Keating’s employment with L Wood Transport Pty Ltd.
4...... At the time of his death Keating was working as an interstate transport driver for L Wood Transport Pty Ltd pursuant to a contract of service.
5...... At the time of his death Keating had been employed by L Wood Transport Pty Ltd for approximately 10 years.
6...... At all material times L Wood Transport Pty Ltd was based at 25 Francis Road, Brahma Lodge in the State of South Australia and paid workers compensation levies in respect of Keating.
7...... At the time of his death Keating resided at Borunga in the State of New South Wales and had done so for approximately 5 years.
8...... Before moving to Borunga in the State of New South Wales Keating resided in the State of South Australia.
9...... From about 1981 Karen Smith lived with Keating in a defacto relationship from which at least one son was born, Mark John Smith born on 19th September 1984.
10.... As at the date of Keating’s death Karen Smith was the putative spouse of Keating.
11.... At the time of Keating’s death Karen Smith was not employed and she and her children, Mark John Smith and Brett Andrew Smith were dependents of Keating.
12.... At the time of his death Keating was working on a full time basis as an interstate transport driver for L Wood Transport Pty Ltd and operating primarily between Sydney and Adelaide.
13.... In the period from 1/7/94 to 30/6/95 Keating was paid a gross wage by L Wood Transport Pty Ltd of $32,759.00 in respect of which L Wood Transport Pty Ltd paid group tax in that period of $6,227.00.
14.... Keating was entitled to holiday pay of 4 weeks per year totalling $2,000 gross.
15.... L Wood Transport Pty Ltd paid superannuation contributions in respect of Keating.
16.... At all material times Keating was subject to the direction and control of L Wood Transport Pty Ltd as a driver and himself did not provide any material or equipment.
17.... During the time he worked for L Wood Transport Pty Ltd Keating regularly travelled to and from the base of L Wood Transport Pty Ltd situated at 25 Francis Road, Brahma Lodge in the State of South Australia to transport goods across South Australia and New South Wales.
18.... At the time of his death Keating was by truck transporting to Sydney in the State of New South Wales for L Wood Transport Pty Ltd a load of onions which he had loaded at Padthaway in the State of South Australia after leaving the base of L Wood Transport Pty Ltd the day before.”
The dependents of the deceased, Mr Keating, Karen Smith, Mark John Smith and Brett Andrew Smith claimed compensation pursuant to s44 of the Act. That section provides for compensation to be paid to dependants of a deceased worker who dies as a result of a compensable disability.
There was no dispute about their dependency. Nor was there any dispute that Mr Keating died at Pinnaroo in the State of South Australia of a disability which arose from employment.
His employer L Wood Transport Pty Ltd is based in this State and pays workers compensation levies pursuant to the Act, and in particular paid workers compensation levies in respect of Mr Keating himself. That was an obligation imposed on the employer by Div 4 of Pt 5 of the Act.
The essential facts are, therefore, that the worker who was employed by a South Australian company operating in South Australia died in South Australia as a result of a disability which arose from employment.
At first blush it would seem that his dependents would be entitled to compensation under s44 of the Act.
However, the appellant argued that Mr Keating would not have been and his dependents are not entitled to any benefits under the Act.
The Court was informed from the Bar table by counsel for the respondent, Mr Cole, that Mr Keating’s dependents are not entitled to any benefits under any corresponding law of any other State or the Commonwealth.
If the appellant’s argument is correct then Mr Keating’s dependents will not be entitled to any workers compensation benefits pursuant to the South Australian Act or any other Act.
If that is to be the result then the result is unfair and unjust.
The appellant submitted that a worker (and in the case of a deceased worker his or her dependants) is not entitled to benefits under the Act unless the worker can come within the territorial application of the Act. It was submitted that it was a precondition to any claim for benefits under the Act that the worker can bring himself or herself within s6 of the Act. Section 6 provides:
“(1).. This Act applies to a worker’s employment (either within or outside the State) if there is a nexus between the worker’s employment and the State.
(2)A nexus exists between a worker’s employment and a State if—
(a)the worker is usually employed in the State and not in any other State; or
(b)the worker is usually employed in 2 or more States but is based in the State.
(3)... In addition, a nexus exists between a worker’s employment and this State if—
(a)the worker is not usually employed in any State; but
(b)the worker is employed in the State or the worker’s employment involves (or is likely to involve) recurrent trips to and from a base in the State, and the worker is not protected against employment-related disabilities by a corresponding law.
In this section -
1. A State includes a Territory.
2...... A reference to employment is a reference to the worker’s work (and not to employment as an abstract legal relationship).
3...... A worker is usually employed in a particular State if 10 per cent or more of the time the worker spends working in employment is (or is to be) spent working in the State.
4...... A worker is based (or has a base) in a particular State if the worker’s usual place of residence is in the State or if the worker regularly travels between a port or other point of embarkation in the State and the place of employment.”

It was submitted that s6 is “an exclusive code” in relation to the territorial application of the Act. I agree with the appellant’s submission that s6 must be satisfied one way or another before a worker is entitled to claim benefits under the Act. If a worker cannot bring himself or herself within the territorial application of the Act then that worker is not entitled to benefits under the South Australian legislation. I agree with the decision of the Full Bench of the Workers Compensation Tribunal in Selamis v Workcover/NZI Workers Compensation (SA) Pty Ltd (unreported, JD36/1997 delivered 30 September 1997) in which the Full Bench described s6 as a separate code as to territoriality.
In my opinion the Act will only apply to a worker if there is a nexus between the worker’s employment and the State. That nexus can only be satisfied, in my opinion, if the worker can bring himself or herself within s6(2) or s6(3).
It is not possible, in my opinion, for a worker to establish a nexus otherwise than by establishing one of the relevant matters in s6(2) and s6(3). In this case, for example, the injury leading to the disability and the death occurred within the State. That is not a relevant consideration in determining whether there is a nexus between the worker’s employment and the State. It follows that it is not a relevant consideration in determining whether the Act has territorial application to the worker. That is because the place where the injury occurred is not a relevant consideration under s6(2) or s6(3).
There are some difficulties about the drafting of s6 which should be noted. In s6(1) there are references to “the State”. In the introductory words in s6(2) there is a reference to “a State”. In s6(2)a and s6(2)(b) the reference is to “the State”. It is also to be noted that in s6(2)(a) there is a reference to “any other State”.
In the introductory words to s6(3) the reference is to “this State” and in the body of s6(3)(b) there are two references to “the State”.
In clauses 3 and 4 of the definition part of s6, apart from the referral to a particular State, the clauses refer to “the State”.
It is necessary, if possible, to reconcile the use of the different expressions.
Section 4 of the Acts Interpretation Act provides, unless the contrary intention appears, that:
“‘the State’ or ‘this State’ means the State of South Australia”.
Section 6(1) requires the worker to establish that there is a nexus between the worker’s employment and ‘the State’. There can be no doubt that the State there means the State of South Australia. It could not be otherwise.
Section 6(2) refers in its introductory words to ‘a State’. However it could not there be referring to South Australia specifically. The use of the words ‘a State’ means that s6(2) is concerned with an inquiry into a nexus between the worker’s employment and any State of the Commonwealth and, because of cl1, any Territory.
Section 6(2)(a) and s6(2)(b) then refer to “the State”. However that is not a reference to the State of South Australia but a reference back to “a State” in 6(2).
That must be so because s6(2)(b) requires a reference to cl4. Clause 4 refers to “a particular State” and then to “the State”. “The State” again must refer back to ‘a State’ in the introductory words in s6(2). Whilst the expression “the State” is used in s6(2)(a) and s6(2)(b) in my opinion the expression does not refer to the State of South Australia but to “a State” in the introductory words in s6(2). In other words “the State” then appearing does not mean the State of South Australia because the contrary intention appears.
In the introductory words to s6(3) the expression ‘this State’ is used. That must mean the State of South Australia. In s6(3)(b) the expression ‘the State’ must also mean the State of South Australia because the inquiry in s6(3)(b) is concerned only with a nexus between the workers employment and South Australia.
In any event with those matters in mind the section reads:
6(1)... This Act applies to a worker’s employment (either within or outside South Australia) if there is a nexus between the worker’s employment and South Australia.
(2)... A nexus exists between a worker’s employment and a State if -
(a)the worker is usually employed in the State and not in any other State; or
(b).... the worker is usually employed in two or more States but is based in the State.
(3)... In addition, a nexus exists between a worker’s employment and South Australia if -
(a) the worker is not usually employed in any State; but
(b).... the worker is employed in South Australia or the worker’s employment involves (or is likely to involve) recurrent trips to and from a base in South Australia and the worker is not protected against employment related disabilities by a corresponding law.
Section 6(3) does not make sense unless the word ‘employed’ appearing in s6(3)(b) is used in a different sense than it is used in s6(3)(a). If it is used in the same sense the subsection would apparently be saying that a nexus exists if the worker is not usually employed in any State (including South Australia) but the worker is employed in South Australia. That would not make any sense. I think the word employed in s6(3)(b) is used in the sense of engaged. That allows that part of the paragraph work to do. It also would be consistent with the alternative in the same paragraph.
Section 6(2) and s6(3) are in somewhat unusual form. It is unusual to see a section which has alternative qualifying circumstances such as in s6(2) and then a further subsection which introduces other qualifying circumstances.
The section may be in that form because the matters in s6(2) are disjunctive whilst the matters in s6(3) are conjunctive. It may also be in that form because s6(3) requires the proof of a negative.
The dependents, if they are to succeed in this matter, must establish that there was a nexus between Mr Keating’s employment and South Australia. If they could have established that Mr Keating came within either of the matters in s6(2) or, alternatively, if he was not usually employed in any State, that he came within either of the two matters in s6(3)(b), then they would be entitled to succeed.
Mr Keating did not come within s6(2)(a) because his duties employed him not only in South Australia but in New South Wales. He spent more than 10 per cent of his working time in employment in both South Australia and New South Wales. He was therefore not usually employed in South Australia and not in any other State.
Mr Keating could not come within s6(2)(b) because whilst he was usually employed in two or more States he was not based in South Australia. He was not based in South Australia because his usual place of residence was not in South Australia. Nor was he a worker who regularly travelled between a port or other point embarkation in South Australia and the place of employment.
It was put by counsel for the respondent that Mr Keating came within the second alternative in cl4 of the definition section in s6 in that he regularly travelled between a point of embarkation which, it was put, was in the circumstances of this case, Brahma Lodge, being the depot where he commenced his work and the place of employment which was in South Australia and New South Wales.
I think such a construction is to strain cl4 to breaking point. Clause 4 talks about travel between a point of embarkation in South Australia and the place of employment. If the place of employment is throughout South Australia and New South Wales then the point of embarkation is not between it and the place of employment. In fact the point of embarkation is within the place of employment.
I do not think that it can be said that Mr Keating comes within s6(2)(b).
Mr Keating could not come within s6(3) because he could not pass the threshold contained in s6(3) itself. S6(3) operates in addition to s6(2) but only in circumstances where the worker is not usually employed in any State. Mr Keating was usually employed in both South Australia and New South Wales because 10 per cent or more of the time he spent working in South Australia and New South Wales. The matters in s6(3)(b) do not fall for consideration because Mr Keating could not come within s6(3)(a).
The appellant’s submission therefore must be accepted.
The appellant’s counsel conceded that the result is anomalous. I agree that the result is anomalous and I reiterate that the result is unfair and unjust.
I would have tried to arrive at a just result but the words of the section prevent me doing so. I cannot ignore the plain words of the section.
During the hearing of the appeal, counsel for the appellant, Mr Stanley, was asked whether his client would be prepared to make an ex gratia payment to the respondent. Mr Stanley undertook to take instructions on that matter. He subsequently advised members of the Court that his client would not be prepared to make an ex gratia payment to the deceased’s dependants. His client was prepared to indemnify the respondent in respect of her costs of this appeal regardless of its outcome. It is not for me to comment upon the appellant’s stand. I am not in a position to do so.
I draw Parliament’s attention to the circumstances of this case. Unless the section is amended, any worker who lives outside South Australia but who is employed in South Australia and whose duties of employment require that worker to perform more than 10 per cent of his or her employment outside South Australia is not entitled to benefits under this Act in the event that the worker suffers a disability, even if that disability arises out of an injury suffered in South Australia.
In my opinion the appeal must be allowed and the order of the Workers Compensation Appeal Tribunal allowing the appeal from the Review Officer should be set aside.
I would hear the parties as to the appropriate orders for costs before the Review Officer and the Tribunal.
The appellant has agreed to indemnify the respondent in respect of her costs of this appeal.

WICKS J

I agree that this appeal should be allowed for the reasons given by Lander J. I also agree with the order that he proposes should be made.

[1998] SASC 6878

2 October 1998