Accident Compensation Corporation v Miller - [2013] NZCA 141

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IN THE COURT OF APPEAL OF NEW ZEALAND

CA311/2012
[2013] NZCA 141

BETWEEN ACCIDENT COMPENSATION CORPORATION
Appellant

AND KENNETH MILLER
Respondent

Hearing: 19 February 2013

Court: Stevens, French and Ronald Young JJ

Counsel: B A Corkill QC and J G Roberts for Appellant
J P Miller and K M Eckersley for Respondent

Judgment: 9 May 2013 at 11.00 am

JUDGMENT OF THE COURT

AThe appeal is allowed.
BThe first question posed by the case stated is:
“Was the High Court erroneous in law when it determined that where the Corporation has been paying compensation, stops it and later it is held that the compensation should have continued, the claimant will be entitled to interest because at the time of suspension or cancellation it had all the information it needed?”
This question is answered “yes”.

The second question posed by the case stated is:
“Was the High Court erroneous in law in determining that such an outcome is not limited to situations where the Corporation is at fault in relation to a suspension decision?”
This question is answered “no”.

CThe case is referred back to the High Court to be dealt with in accordance with the principles set out in this judgment.
DThere is no order as to costs.

____________________________________________________________________

REASONS OF THE COURT

(Given by Stevens J)

Table of Contents

Para No

Introduction  [1]
Factual background  [7]
Relevant legislation  [16]
District Court judgment  [18]
High Court judgment  [26]
Submissions of the parties  [31]
Discussion  [38]
Our answers to the questions of law posed by Simon France J          [51]
Where to from here?  [58]

Submissions of the parties [62]
Our view [67]

Result and costs [69]

Introduction

This appeal concerns the circumstances in which the Accident Compensation Corporation (the Corporation) is required to pay interest on late payments of compensation. The case has an unusual history. Compensation was first paid to Mr Miller in 1974 when he suffered what was thought to be a workplace injury. In 1977 Mr Miller suffered another injury, also thought to have been a workplace injury. Investigations into the causes of the injuries continued. Later the payments of weekly compensation were stopped in 1978 when all the information (supported by two medical reports) before the Corporation suggested that the incapacity was caused by disease rather than workplace injury. Between 1993 and 1994 the Corporation received two medical reports stating that Mr Miller did not have a disease affecting his back. However, payments of weekly compensation were not reinstated until 2003 following a decision by the Accident Compensation Appeal Authority (the Authority).[1]
[1] Miller v Accident Compensation Corporation ACA 88/95, 23 April 2003.
The Authority determined that Mr Miller’s incapacity was due to a combination of disease and workplace injury. As a result, Mr Miller was entitled to weekly compensation which should have been paid continuously since 1974. Mr Miller was paid backdated compensation accordingly. The issue before us is whether he is entitled to interest…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2013] NZCA 141
Decision Date: 9 May 2013

CaseChat Overview and Summary

The case of Accident Compensation Corporation v Miller was heard in the District Court of New Zealand, with Judge Ongley presiding. The dispute centred on the interpretation of statutory provisions regarding the payment of interest on weekly compensation by the Accident Compensation Corporation (ACC) when the payment is delayed. Mr Miller, the claimant, argued that his entitlement to interest arose in 1993 when the ACC received a report from Mr Baylis. He contended that the Corporation already had the necessary financial information on file at that time, thus the interest requirement was "crystallised." The ACC, however, contended that the medical conclusions were not clear until at least 2001.

The legal issues before the court were primarily about the timing of when the ACC had "all information necessary" to calculate and make the payment, as stipulated by s 114 of the 2001 Act, and whether the interest requirement "crystallised" when the ACC received the Baylis report in 1993. The court had to determine when the Corporation actually had sufficient information to make the payment and, therefore, when the interest should commence. The court considered the timeline of the reports received and the medical evidence that was necessary to make a final determination about Mr Miller’s claim.

Judge Ongley concluded that the ACC did not have all necessary information until at least 2000, and more likely until 2001 or 2002. The reports received prior to 2000 were not sufficient for the Corporation to decide to pay arrears of weekly compensation. The Judge held that the interest requirement did not "crystallise" in 1993 but rather when the ACC received all necessary information to make the payment, which was in 2003. Consequently, the interest was payable from that date. The court’s reasoning hinged on the statutory requirement that the ACC must have "all information necessary" to make the payment before the interest obligation arises.

The District Court found in favour of the ACC and held that Mr Miller's entitlement to interest arose in 2003, when the ACC had all necessary information to calculate and make the payment. The court did not award interest for the period prior to this date. This decision aligns with the statutory framework that requires the ACC to have complete information before interest accrues.

Orders

Orders of the court

Full text does not contain this section.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

The relevant provision concerning payment of interest is currently s 114 of the 2001 Act. That section provides:114Payment of interest when Corporation makes late payment of weekly compensation(1)The Corporation is liable to pay interest on any payment of weekly compensation to which the claimant is entitled, if the Corporation has not made the payment within 1 month after the Corporation has received all information necessary to enable the Corporation to calculate and make the payment.(2) The Corporation is liable to pay the interest—(a)at the rate for the time being prescribed by, or for the purposes of, section 87 of the Judicature Act 1908; and(b)from the date on which payment should have been made to the date on which it is made. This section is the successor to s 101 of the Accident Insurance Act 1998 (the 1998 Act) and s 72 of the Accident Rehabilitation and Compensation Insurance Act 1992 (the 1992 Act). In Accident Compensation Corporation v Kearney this Court held the very slight changes to the wording of these sections were inconsequential.[9] The Court also held that s 72 of the 1992 Act governed the period 1 July 1992 to 1 July 1999, s 101 of the 1998 Act governed the period 1 July 1999 to 1 April 2002, and s 114 governs the period from 1 April 2002.[10] These aspects are not in dispute. The interest question came before Judge Ongley in the District Court. The Judge began by detailing the factual background to Mr Miller’s claim, as described at [7]–[15] above. Before the District Court, Mr Miller argued that his entitlement to interest arose in 1993, when the Corporation received Mr Baylis’ report. He submitted that at the time the Corporation received this report it already had the necessary financial information on file. For that reason the interest requirement “crystallised” at this point. By contrast, the Corporation argued that the medical conclusions were not clear until at least 2001. Judge Ongley identified two reasons why the Corporation did not have “all information necessary” to calculate Mr Miller’s payment until 2003. First, the Judge found that the Corporation did not have all necessary medical information until 2000 at the earliest. At this point the later reports of Dr Macedo had been received, reporting Mr Miller’s case in more detail. Prior to this time, the Corporation did not have all necessary information; at best, it had information that required further investigation. In particular, with respect to the reports of Mr Baylis, Dr Macedo, and other information received prior to 2000 (including a report from Dr Reynolds in 1999), the Judge found:[32] In my view that medical evidence was not enough for the Corporation to decide to pay arrears of weekly compensation. The claim was not able to be fully considered until further reports were received from Dr Macedo, and again from Dr Reynolds in 2000 and 2001. The decision by [the Authority] relied on those reports, which were received once the 1998 Act was in force.