Fraser, Cameron Dirk v A G & S A Chapman Pty Ltd [1998] FCA 814

FEDERAL COURT OF AUSTRALIA WORKERS' COMPENSATION - registration under the Workers' Compensation Act 1951 (ACT) of memorandum of agreement by way of compromise and satisfaction of all claims - whether Magistrate has jurisdiction under the Act to set aside an agreement once registered on the basis that no agreement in fact existed or had ceased to exist at the time of registration - whether such remedy available in another forum Workers' Compensation Act 1951 (ACT) Workers' Compensation Act 1906 (UK) Schofield v W C Clough & Co [1913] 2 KB 103, considered CAMERON DIRK FRASER v AG & SA CHAPMAN PTY LIMITED AG 84 of 1997 O'CONNOR, COOPER, FINN JJ CANBERRA 8 JULY 1998

IN THE FEDERAL COURT OF AUSTRALIA

AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY AG 84 of 1997

on appeal from the SUPREME court of the australian capital territory

BETWEEN: CAMERON DIRK FRASER

Applicant

AND: AG & SA CHAPMAN PTY LIMITED

Respondent

JUDGES: O'CONNOR, COOPER, FINN JJ

DATE OF ORDER: 8 July 1998

WHERE MADE: CANBERRA

THE COURT ORDERS THAT: 1. The appeal be dismissed. 2. No order be made as to costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA

AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY AG 84 of 1997

on appeal from the SUPREME court of the australian capital territory

BETWEEN: CAMERON DIRK FRASER

Applicant

AND: AG & SA CHAPMAN PTY LIMITED

Respondent

JUDGES: O'CONNOR, COOPER, FINN JJ

DATE: 8 July 1998

PLACE: CANBERRA

REASONS FOR JUDGMENT This appeal raises an issue as to the jurisdiction of a Magistrate under the Workers' Compensation Act 1951 (ACT) ("the Act") to set aside an agreement for the payment of a lump sum to an injured worker in satisfaction of an employer's liability to pay compensation, where a memorandum of that agreement has been registered under Schedule 4 of the Act and in consequence to rectify the Register under Clause 9 of that Schedule. As we agree with the views expressed by Chief Justice Miles in the decision appealed from as to the limits of that jurisdiction, we consider it necessary only to make the following additional observations in deference to the submissions made to us. Otherwise we adopt what his Honour has said. The scheme of Schedule 4 of the Act insofar as presently relevant proceeds as follows. (i) An employer and employee enter into an agreement for payment of a lump sum by way of compromise and satisfaction of all claims. (ii) The Registrar of the Magistrates Court, having been provided with a memorandum of that agreement, records that memorandum in a special register on being satisfied as to its genuineness. (iii) On registration the person by whom compensation is payable is thereby exempted from liability to pay compensation. And (iv) the memorandum of agreement itself is "for all purposes … enforceable as a judgment of the Court": see Schedule 4 cll 9, 10. In this scheme the Schedule provides that the Magistrates Court can determine the efficacy of the agreement giving rise to the memorandum thereof at two distinct times. Clause 9(d) allows this to occur prior to registration in the following way: "Cl 9 (d) where it appears to the Registrar of the Court, on any information which the Clerk considers sufficient, that an agreement made before ascertainment of compensation between a worker and the worker's employer for payment of a lump sum by way of compromise in satisfaction of all claims or an agreement as to the redemption of a weekly payment by a lump sum, or an agreement as to the amount of compensation payable to a person under any legal disability, or to dependants, ought not to be registered by reason of the inadequacy of the sum or amount, or by reason of the agreement having been obtained by fraud or undue influence, or other improper means, the Clerk may refuse to record the memorandum of the agreement sent to him or her for registration, and refer the matter to the Court, which shall, in accordance with Rules of Court, make such order (including an order as to any sum already paid under the agreement) as under the circumstances it thinks just; and" Under cl 9(e) power is given to attack the agreement for a period of 6 months after registration of a memorandum. It provides: "(e) the Court may, within six months after a memorandum of an agreement as to compromise of claims or the redemption of a weekly payment by a lump sum or of an agreement as to the amount of compensation payable to a person under any legal disability, or to dependants, has been recorded in the register, order that the record be removed from the register on proof to its satisfaction that the agreement was obtained by fraud or undue influence or other improper means, and may make such order (including an order as to any sum already paid under the agreement) as under the circumstances it thinks just." Apart from these two provisions no jurisdiction is given the Magistrates Court under the Act to determine the existence and validity of the agreement founding a registered memorandum. In this matter the subject of the present appeal, the circumstances were not ones falling within either cl 9(d) or cl 9(e). Nonetheless the Magistrate assumed jurisdiction under the Act to set aside an agreement that had been registered on the basis that no agreement in fact existed or else had ceased to exist at the time of registration. Chief Justice Miles concluded that the Magistrate did not have any general jurisdiction to do so. And, as we have said, we respectfully agree with him. The Magistrate's jurisdiction to question the agreement was limited to the circumstances provided for in cl 9(d) and (e). The appellant sought both before the Chief Justice and before us, to circumvent the inconvenience of this conclusion by relying on the provisions of cl 9(c) of Schedule 4 which provides: "(c) the Court may at any time rectify its register." Schedule 4, Clause 9 is based upon equivalent English legislation, the Workers Compensation Act, 1906, Second Schedule, Clause 9. The powers conferred by Clause 9(c) of that Act were considered by the English Court of Appeal in Schofield v W C Clough & Co [1913] 2 KB 103. In that case Cozens-Hardy M.R. said at 107: "A distinction has been drawn between rectifying and removing. The judge may rectify at any time so as to make the registered memorandum of an agreement accord with the actual facts and the agreement entered into between the parties." and "This rectification is however, separate and distinct from removal.." and " ... we are here dealing with a special and peculiar jurisdiction conferred by statute on the judge of the county court, and there is no presumption that he is to have any general jurisdiction in the matter, or any powers beyond those to be found in the Act." We consider that the power to rectify in Schedule 4 is ample enough to justify the removal of a memorandum of a non-existent or otherwise inefficacious agreement from the register. Nothing in Schedule 4 would prevent such a result. What, though, it does not itself do is confer jurisdiction on the Magistrate's Court to determine whether an agreement is non-existent or inefficacious. This can be done only in a court of competent jurisdiction. So, for example, the Supreme Court in the exercise of its equitable jurisdiction could set aside an agreement as an unconscionable dealing, or, at common law, it could declare that no actual agreement was entered into for non est factum reasons. If this matter were determined in the respondent's favour by such a court we consider that the Magistrate's Court would then pursuant to cl 9(c) have power to rectify the register by removal of the memorandum. To the extent that Schofield's case, above, may be taken as suggesting a different and more limited view of the power to rectify, we would decline to follow it. We will dismiss the appeal. It is appropriate, though, to draw attention to the obvious inconvenience caused by the Schedule in its present form when a party wishes to question the existence or validity of an agreement giving rise to a registered memorandum. The need to have resort to the Supreme Court to have that question determined (if cl 9(c) is not for any reason able to be availed of) is, perhaps, a matter that the appropriate authorities may wish to examine. I certify that this and the preceding three (3) pages are a true copy of the Reasons for Judgment therein of the Honourable Justices O'Connor, Cooper and Finn