Jones v Accident Compensation Corporation

[2016] NZHC 707

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CIV-2015-404-2447 [2016] NZHC 707

UNDER

the Accident Compensation Act 2001

IN THE MATTER

of an application for special leave to

appeal to the High Court pursuant to s 162 of the Act

BETWEEN

CRAIG JONES Applicant

AND

ACCIDENT COMPENSATION CORPORATION

Respondent

Hearing:

16 March 2016

Counsel:

Appearance:

D K L Tuiqerequere for respondent

C Jones, applicant in person

Judgment:

18 April 2016

JUDGMENT OF PALMER J

This judgment was delivered by me on 18 April 2016 at 2.00 pm, pursuant to Rule 11.5 of the High Court Rules.

Registrar/Deputy Registrar

Date……………

Solicitors:           Medico Law Ltd, Auckland

To:  C Jones, Auckland

JONES v ACCIDENT COMPENSATION CORPORATION [2016] NZHC 707 [18 April 2016]

Summary

[1]      Mr Craig Jones received WINZ payments from May 2005 to August 2008 when he was thought not to qualify for ACC payments.   When it was found he qualified  for ACC  payments  after  all, ACC  repaid  WINZ  its  payments,  repaid Mr Jones the rest of his entitlement and paid Mr Jones interest on the rest of his entitlement.  Mr Jones also wants to be paid interest on the money ACC repaid to WINZ.  The District Court ruled against him.  He seeks special leave from the High Court to appeal from the District Court.  I dismiss the application.  His argument has no reasonable prospect of success.  He received the WINZ payments at the time and is not out of pocket in relation to them.

Facts

[2]      Mr Jones, the applicant, received ACC payments for a back injury suffered in April 1992.  From 17 May 2005 his weekly ACC payments were suspended as he was assessed as being able to work (or, in ACC-speak, having “vocational independence”).  His appeal of that decision succeeded in the District Court, more than three and a quarter years later, and he was paid backdated compensation by ACC on 23 September 2008.1

[3]      During  the  three  and  a  quarter  year  period  Mr  Jones  received  benefit payments  from  WINZ.    In  2008  ACC  reimbursed  WINZ  for  those  payments, totalling $35,491.20, as it was required to do under s 252 of the Accident Compensation Act 2001 (the Act). ACC paid the rest of Mr Jones’ ACC entitlement, totalling $61,408.34, direct to Mr Jones.

[4]      Mr Jones sought payment of the interest on the arrears payment made to him under s 114 of the Act.  ACC refused and Mr Jones sought a review of that decision under part 5 of the Act, which failed.  He appealed against the review decision and

lost in the District Court.2   He was granted special leave to appeal to the High Court.

1      Jones v Accident Compensation Corporation [2008] NZACC 195.

2      Jones v Accident Compensation Corporation [2011] NZACC 209.

Before that was heard, the Court of Appeal decided the point in a different case of

ACC v Miller.3 ACC then paid Mr Jones the interest arrears he was owed.

[5]      In addition to the interest arrears he has been paid, Mr Jones also seeks to be paid interest on the money that ACC repaid to WINZ.  After he failed in his review of  that,  Judge  Mathers  in  the  District  Court  dismissed  Mr  Jones’  appeal.4

Judge MacLean declined his application to appeal to the High Court.5   Mr Jones now

seeks special leave of the High Court to appeal.  ACC opposes special leave, saying the point has already been decided, against him, by the Court of Appeal in Cullen v ACC and he has no reasonable prospect of success.6    Mr Jones says the Court of Appeal is wrong and its decision is distinguishable from his case.

Law

Special Leave to Appeal

[6]      Section 162(3) of the Act empowers the High Court to grant special leave to appeal a decision of the District Court as being wrong in law, where the District Court has declined leave to appeal.   Drawing on the summaries by Toogood J in Cullen  v ACC,7   and  by  Fisher  J  in  Kenyon  v  ACC,8   I  summarise  the  relevant authorities as follows:

(a)       The appeal can only be made on a question of law and it is for the appellant to show that leave is required in the interests of justice.

(b)The purpose of requiring leave for certain appeals is to ensure that scarce judicial time is allocated sensibly.

(c)       Special leave is a matter for the discretion of the Court and ought not to be granted as a matter of course.

3      Accident Compensation Corporation v Miller [2013] NZCA 141, [2013] 3 NZLR 312.

4      Jones v Accident Compensation Corporation [2015] NZACC 2.

5      Jones v Accident Compensation Corporation [2015] NZACC 302.

6      Cullen v Accident Compensation Corporation [2013] NZCA 94.

7      Cullen v Accident Compensation Corporation [2013] NZHC 941.

8      Kenyon v Accident Compensation Corporation [2001] NZHC 1301, [2002] NZAR 385.

(d)It  will  normally  be  necessary  to  show  that  there  is  an  issue  of principle, or a considerable amount, at stake and that there is a reasonable prospect of success.

Payment of Interest

[7]      The law concerning the payment of interest on ACC payments is contained in ss 114 and 252 of the Act. Section 114 requires reimbursement and s 252 sets out the relationship between ACC and WINZ payments.

114      Payment 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 was made.

252     Relationship with social security

(1)       This section applies if a person —

(a)    receives  a  payment  of  an  income-tested  benefit  under  the  Social

Security Act 1964 in respect of a period; and

(b)    establishes a claim to an entitlement from the Corporation in respect of all or part of the same period.

(2)       An excess benefit payment is regarded as having been paid in respect of that entitlement.

(3)       An excess benefit payment is the part of the benefit payment (up to the amount of the entitlement) that is in excess of the amount of benefit properly payable, having regard to the entitlement under this Act.

(4)       The Corporation must refund the excess benefit payment to the department responsible for the administration of the Social Security Act 1964 —

(a)    if the Corporation knows that this section applies; or

(b)    if requested to do so by that department.

(5)       For  the  purposes  of  this  section,  an  excess  benefit  payment  includes  a payment of any part of a couple rate of benefit that is paid to the spouse or partner of the person who established the claim to the benefit.

(6)       Any amount that is treated under this section as having been paid in respect of  any treatment,  service, rehabilitation, related  transport,  compensation, grant, or allowance is deemed for all purposes to have been so paid.

[8]      In Cullen v ACC the Court of Appeal considered whether Mr Cullen should be granted special leave to appeal on the following question:9

Is the [Accident Compensation] Corporation required to pay interest on the whole amount of retained weekly compensation [to which the applicant was entitled] notwithstanding any repayment to WINZ of income support benefit paid to the [applicant]?

[9]      The Court of Appeal found that the question was not capable of serious argument.10   It pointed out that s 114 relates to compensation to which a claimant is “entitled” and its purpose is to ensure a claimant is not left out of pocket as a result of a late payment.11    The purpose of s 252 is to prevent a beneficiary retaining the benefit of payments made under the Social Security Act and claiming, in arrears, payment from ACC.12     Parliament intended assistance should be available under either the ACC or the social security schemes, but not under both.13   The key point that disposed of that application for special leave, and disposes of this one, is:14

Finally, when ss 114 and 252 are read together it is clear that no interest is payable under s 114 on the amount of a Corporation refund to WINZ under s

252 because the claimant has not in fact received any late payment to which

he or she was entitled in respect of which interest is payable.

[10]     As the Court said:15

Mr Cullen was out of pocket in respect of the late payment he received.  He was not out of pocket in respect of the refund to WINZ.

9      Cullen v Accident Compensation Corporation, above n 6 at [1].

10 At [7].

11     At [9] and [10].

12 At [13].

13 At [11].

14 At [14].

15 At [15].

Decision

[11]     The Court of Appeal’s decision in Cullen v ACC disposes of the application for special leave here.  Mr Jones had the benefit of the WINZ payments at the time he should have been receiving the ACC payments.   He was therefore not out of pocket for the amount of the WINZ payments.  He was out of pocket for the amount the ACC payments exceeded the WINZ payments – but he was repaid that and received interest on that repayment.  He should not receive interest on the amount of the WINZ payments.  If anyone should receive interest, it should be WINZ who was out of pocket for having wrongly paid Mr Jones.   But, as Mr Jones noted in oral argument, the legislative regime does not recognise interest being payable to WINZ.

[12]     Even if I were not bound by Court of Appeal authority, as I am, Mr Jones’ argument that Cullen v ACC is wrong would not be sustainable.  The judgment is based on the clear text and purpose of the Act and economic common sense.

[13]     In his very full submissions Mr Jones said that the equivalent provision in the predecessor Accident Insurance Act 1998 did not contain the equivalent of s 252(6) which deems an amount treated as having been paid to have been so paid “for all purposes”.  But, as Mr Tuiqerequere submits, we are not dealing with that Act here. And the Court of Appeal’s interpretation did not depend upon that point.

[14]     Mr Jones made a submission based on the source of funding for ACC but that is irrelevant to the question here, as is the common law principle for the payment of interest.  Mr Jones also submitted that the Court of Appeal should have applied the judgment  of  Accident  Compensation  Corporation  v Kearney  rather than  that  of Accident Compensation Corporation v Miller.16    However, the Court of Appeal did

not apply Miller.17  And the issues considered in  Kearney largely concerned the

1998 Act and do not touch on entitlement to interest on WINZ payments

16     Accident Compensation Corporation v Kearney [2010] NZCA 327 and Accident Compensation

Corporation v Miller, above n 3.

17     At [10] the Court of Appeal said it did not accept there was anything in Accident Compensation

Corporation v Miller that contradicted its interpretation.

[15]     I agree with Judge Mathers and Judge MacLean and with ACC.  Mr Jones’ appeal has no reasonable prospect of success.   I dismiss Mr Jones’ application for special leave to appeal.

[16]     It is my preliminary view that ACC should be awarded costs on a category 2 basis.  If Mr Jones wishes to advance submissions on that matter he may file in Court and serve on the ACC a memorandum by 5 pm Monday 2 May 2016.  The ACC will have  ten  working  days  from  service  of  any  such  memorandum  to  file  its memorandum in response.

Palmer J