INSURERS GUARANTEE FUND NEM GENERAL INSURANCE ASSOCIATION LTD (IN LIQUIDATION) v FAI WORKERS COMPENSATION (NSW) LTD SUPREME COURT OF NEW SOUTH WALES COURT OF APPEAL CLARKE, MEAGHER and HANDLEY JJA 14 July 1995, 29 August 1995 [1995] NSWCA 208 WORKERS COMPENSATION — s11(1) WORKER'S COMPENSATION ACT 1926 — 1985 INJURY — PERIODIC PAYMENTS — MUTUALITY REQUIREMENT. FACTS: The respondent worker suffered injuries on 8 February 1985 to his back, right leg, and neck. In April 1989 he suffered another injury while working for the same employer, which further reduced his ability. In 1987 an award was made by consent pursuant to s11(1) of the Workers Compensation Act 1926 in respect of the 1985 injury. The worker applied to the Compensation Court to vary the award. The trial judge made the following orders: (1) an award under s11(1) of the 1926 Act for periodic payments from 5 June 1989 to 4 April 1991 in respect of the 1985 incident, but only in respect of the right leg; (2) an award under s11(2) of the 1926 Act in respect of the same accident from 5 April 1991 to date; and (3) an award under s40 of the 1987 Act in respect of the 1989 injury. The appellant, insurer for the employer, appealed against the s11(1) award, stating that it was impermissibly limited to the right leg; and that the trial judge treated the worker's case as if it were an original application. The appellant also submitted that the second accident suffered by the worker destroyed the mutuality necessary for an award under s11(2) of the 1926 Act. HELD: (1) (By Meagher JA, Clarke and Handley JJA agreeing) The fact that the trial judge limited the s11(1) award to the worker's right leg does not matter, because the words in the award, "resulting from injury to his right leg on 8 February 1985" can be read as "resulting from his 8 February 1985 injuries", in which event the award becomes unexceptionable. (2) (By Meagher JA, Clarke and Handley JJA agreeing) If the trial judge had correctly treated the worker's case as an application for the variation of an award instead of as an original application, he nevertheless would have reached the same result. (3) The second accident destroyed the mutuality necessary for an award under s11(2). However, the trial judge's mistake did not affect the result, because the s11(2) award would have to be replaced by a s11(1) award of exactly the same amount. Sydney City Council v Ince (1989) 16 NSWLR 690 cited. ORDERS: (1) Vary O.2 of the Award of Manser CCJ by substituting the following for the first three lines of the order: "That the first respondent, in the interests of the Insurers' Guarantee Fund, pay to the applicant weekly compensation in respect of partial incapacity resulting from the injury on 8th February 1985 at the rate of:" (2) Vary O.3 of the Award by deleting the words "injury to the applicant's back" and substituting the words "the injury on or about 15 May 1989". (3) Subject to the above variations appeal dismissed with costs. CASES CITED: Sydney City Council v Ince (1989) 16 NSWLR 690 Clarke JA I agree with Meagher JA. 2 UNREPORTED JUDGMENTS Meagher JA This is a case which has become unnecessarily involved. The worker suffered a very severe injury on 8 February 1985 when he sustained injuries to his back, right leg and neck. In April 1989 he suffered a further injury of some seriousness, whilst working for the same employer. He also suffered a third injury, but of less seriousness, on 21 March 1991, which seemed to have 110 more than temporary consequences. In 1987 an award was made by consent pursuant to s11(1) of the Workers Compensation Act 1926 in respect of the 1985 injury. Apart from the question of lump sum awards and matters of detail, one would have thought the case simple enough. The worker was entitled to one award under s11(1) of the 1926 Act, and another award under s40 of the 1987 Act - the former in respect of the 1985 injury, the latter in respect of the 1989 injury. However, that is not precisely what Manser CCJ did. In a seventy five page judgment which discussed almost everything except the relevant issues, he made the following orders: [1] 1. An award under s11(1) of the 1926 Act for periodic payments from 5 June 1989 to 4 April 1991 in respect of the 1985 incident, but only in respect of the right leg (suggesting, I suppose, that another award might be possible under s11(1) in respect of the 1985 accident in respect of the back, and a third in respect of the neck) [2] 2. An award under s11(2) of the 1926 Act in respect of the same accident from 5 April 1991 to date; and [3] 3. An award under s40 of the 1987 Act in respect of the 1989 injury. His Honour also made other awards and orders not now materially relevant. [4] Further, his Honour made orders, purportedly under s22 of the 1987 Act, "apportioning" the burden of some of his awards amongst the various insurers who were on risk at the relevant times. These "s22" orders raised a flurry of appeals, since they were made without jurisdiction, but these appeals have been settled. The matters in dispute have become limited to the correctness of the two s11 awards; no attack is made on the s40 award. The appellant is the employer's insurer; the only respondent left is the worker. The appellant's attack on the s11(1) award started with the proposition that it was limited to the right leg, quite impermissibly. One injury to many parts of the body can produce but a single "incapacity" and therefore a single award. The appellant then pointed to the fact that his Honour treated the worker's case as if it were an original application under s11(1), and not - which in fact it was - an application to vary an award of $35.00 per week. His Honour's award is perhaps made a little more curious by his finding: [5] "The disability to the applicant's right leg results from the injury suffered by him in 1985 and there is no evidence that this disability has been made worse by any employment or employment injury subsequent to 1985." All this is true, but in my view does not matter. The first complaint disappears if one reads the words in the award "resulting from injury to his right leg on 8 February 1985" as "resulting from his 8 February 1985 injuries", in which event the award becomes unexceptionable. As to the fact that the application was really an application for a variation, I consider this beside the point: if his Honour had treated it as it was he would have reached the same result. The appellant's attack on the s11(2) award arose out of the fact that the second accident had destroyed the necessary "mutuality". After the second accident the worker's ability was no longer commensurate with his reduced ability to work UWRSIURERS GUARANTEE FUND NEM GENERAL INSURANCE ASSOCIATION LTD (I§ LIQUIDATION) v FAl WORKERS COMPENSATION (NSW) LTD (Handley JA) consequent on the first accident. The point is, of course, entirely covered by the decision of this Court in Sydney City Council v Ince (1989) 16 NSWLR 690, although his Honour seemed to think that decision was not binding on him. This should mean that the s11(2) award should be disallowed. However, it would have to be replaced by a s11(1) award of exactly the same amount. In the event none of his Honour's mistakes affects the ultimate result and the following orders should be made: 1. Vary O.2 of the Award of Manser CCJ by substituting the following for the first three lines of the order: [6] "That the first respondent, in the interests of the Insurers' Guarantee Fund, pay to the applicant weekly compensation in respect of partial incapacity resulting from the injury on 8th February 1985 at the rate of: " [7] and deleting from subpara(1) to para(10) of that order all words after the last date in each of those subparagraphs. [8] 2. Vary 0.3 of the Award by deleting the words "injury to the applicant's back" and substituting the words "the injury on or about 15 May 1989". [9] 3. Subject to the above variations appeal dismissed with costs. Handley JA I agree with Meagher JA. (1) Vary O.2 of the Award of Manser CCJ by substituting the following for the first three lines of the order: "That the first respondent, in the interests of the Insurers' Guarantee Fund, pay to the applicant weekly compensation in respect of partial incapacity resulting from the injury on 8th February 1985 at the rate of:" (2) Vary O.3 of the Award by deleting the words "injury to the applicant's back" and substituting the words "the injury on or about 15 May 1989". (3) Subject to the above variations appeal dismissed with costs. COUNSEL: Appellant: JW WEST QC/ FFJ DAVIES Third Respondent: R HARRINGTON SOLICITORS: Appellant: NW AUSSEL Third Respondent: CARROLL AND O'DEA