Carrette v SAS Trustee Corporation [2001] NSWCC 11

Reported Decision : (2001) 21 NSWCCR 586

Compensation Court of New South Wales

CITATION : Carrette v SAS Trustee Corporation [2001] NSWCC 11 Carrette PARTIES : v SAS Trustee Corporation MATTER NUMBER(S) : 639 of 2000 JUDGMENT OF: Neilson J at 1 CATCHWORDS: Statutes & Delegated Legislation :- Claim for increase in pension benefit Enquiry into economic incapacity LEGISLATION CITED: Police Regulation (Superannuation) Act 1906 s 10(1A)(b)(ii). CASES CITED: Shepherd v SASB (1996) 12 NSWCCR 710 applied; Methodology adopted in Poole v SASB (Curtis, J, unreported, 21 August 2000, 7432/97) not adopted. DATES OF HEARING: 02/03/01 EX TEMPORE JUDGMENT DATE : 03/02/2001

FOR APPLICANT: Mr J J Klarica instructed by Taylor & Scott LEGAL REPRESENTATIVES: FOR RESPONDENT: Mr T M Ower instructed by Brian Matthews

JUDGMENT: 1. This is an appeal pursuant to s 21 of the Police Regulation (Superannuation) Act 1906. The appellant, Mr Darryl Carrette, was formerly a senior constable in the Highway Patrol. He has been medically discharged from the New South Wales Police Service and the infirmity of post-traumatic stress disorder and major depressive episode has been certified as being the result of the applicant's having been hurt on duty. 2. The appellant is being paid a superannuation allowance of 77 per cent of the salary of his office. The appellant applied to the current respondent for an increase in the rate of his superannuation allowance which application for increase beyond 77 per cent was refused by the respondent on 29 November 1999. 3. The appellant had been discharged from the New South Wales Police Service on 14 November 1996. There is very little evidence before me because of my entering a demurrer, if I may use that expression, to the applicant's appeal at an early stage. Exhibit A indicates that at the date of his discharge from the New South Wales Police Service, the appellant would have been earning $808.38 per week. Since 1 January 2000, the applicant would have been earning $826.70 per week. 4. Exhibit B shows part of the actual appellant's actual earnings during the period now in question. It shows that between 30 June 1997 and 30 June 1998, the appellant actually earned $4607.48. During the period 12 September 1999 to 27 February 2000, the applicant actually earned $606.54 per week. The applicant actually earned between 6 March 2000 and 30 June 2000, $935.85 per week. I apprised by those at the Bar table that the applicant is currently employed by BHP and as I understand the position, his earnings are now commensurate with $935.85 per week. 5. I am now told by the appellant's counsel that the minimum wage that the appellant is now receiving is $608 per week. The applicant is actually receiving at the current time, $636.56 by way of superannuation allowance. Accordingly, his pension plus his actual earnings exceed $1,200 per week. However, had he stayed a member of the Police Service, he would be earning only $826.70 per week. 6. The authorities make it clear that a person's earnings ought be taken as his ability to earn unless it can be established that for some reason unrelated to injury they do not reflect the ability of a person to earn in the open labour market. The authorities all refer to the actual earnings not being taken as the ability to earn where the ability to earn is greater than the actual earnings. However, it is not permissible, at least in workers compensation law, to reduce the actual earnings to find a lower capacity to earn and then award a sum greater than the difference between his probable earnings but for injury and the actual earnings. 7. In the circumstances one can see that to increase the superannuation allowance beyond the 77 per cent currently being paid to the 85 per cent claimed, I would be increasing the applicant's actual income to a level even greater than it currently exceeds his probable earnings but for injury as a member of the New South Wales Police Service and it would indicate that I was artificially lowering his ability to earn, not consonant with the decided authority. 8. In Shepherd v State Authorities Superannuation Board (1996) 12 NSWCCR 710 I said at 712C: The question for my determination is pursuant to s 10(1A)(b) of the Police Regulations (Superannuation) Act 1906 as the applicant does not maintain that he brings himself within subsection (1A)(c). If the applicant was still receiving the full salary of his office, he would be earning $846.50 per week. The 77 per cent of the salary of his office which he is now being paid, entitles him to $651.80 per week. In discussion with counsel for the parties, it was submitted that the inquiry is an economic one and, after considering the matter, I agree with those submissions. It is, as I put to Mr Edwards for the applicant, really an inquiry under s 40 of the Workers Compensation Act 1987 where the minimum which the applicant may receive is 72.75 per cent of the salary of his office. The question is, what is the applicant's ability to earn in the open labour market reasonably accessible to him? 9. In that case, I went on to determine that the appellant's ability to earn was only $150 per week, indicating an economic loss of $696.50 per week which entitled the appellant in that case to an increase in his superannuation allowance to an additional 9.75 per cent of the salary of the appellant's office. 10. A somewhat similar approach was taken by his Honour Judge Curtis in Poole v The State Authorities Superannuation Board (unreported, 21 August 2000, matter number 7432 of 1997). In that case, his Honour said: I reject Mr Walsh's submission that the inquiry mandated by s 10(1A)(b)(ii) is an inquiry into physical incapacity. The question must be the incapacity to obtain paid employment. It is incapacity in an economic sense which is relevant. I am to estimate the amount for which the man's capacity has been reduced in the open labour market should he be at all minded to look for work. 11. Although his Honour's approach was somewhat different, in that his Honour merely found a diminution of earning capacity of 50 per cent and then awarded the appellant 50 per cent of the additional 12.25 per cent that may be allowed in certain circumstances, his Honour's reasoning reflects my interpretation of this provision. 12. Mr Klarica for the appellant, made a submission which was clearly contrary to my decision in Shepherd's case, and one specifically rejected by his Honour Judge Curtis. Mr Klarica was unable to provide me with any authority to the contrary. In accordance with the doctrine of stare decisis, the earlier decisions must be followed unless for cogent reasons they can be shown to be wrong. No cogent reason has been put to me. Mr Klarica submitted that it is an error to take into account concepts under the Workers Compensation Act 1987 in considering the provisions of the Police Regulation (Superannuation) Act 1906. I must reject that submission. The Police Regulation (Superannuation) Act 1906 does provide a general superannuation scheme for members of the New South Wales Police Service who joined prior to 1 April 1988. However, grafted onto those general superannuation provisions, are extra benefits for those members of the New South Wales Police Service who are medically discharged on the grounds of having been "hurt on duty". "Hurt on duty" is defined in that Act as meaning: Injured in such circumstances that if the member were a worker with the meaning Workers Compensation Act 1987, he would be entitled to compensation under that Act. 13. The Superannuation Act also makes provision for the payment of "gratuities" equivalent to benefits under s 60, s 66 and s 67 of the Workers Compensation Act 1987. Therefore, it can be seen that elements of workers compensation have been imported into the Police Regulation (Superannuation) Act 1906. It must be recalled that at common law, constables of police were not employees and therefore were not employed under contract of service and not entitled to benefits under the Workers Compensation Acts. Indeed, in New South Wales, the Act used specifically to exclude from its operation members of the Police Service, but that was merely reflecting the common law. 14. Since the closure of the Police Superannuation Fund with effect from 1 April 1988, members of the New South Wales Police Service who join from 1 April 1988 are deemed by the Workers Compensation Acts to be workers within the meaning of those Acts so that they can obtain benefits under the Workers Compensation legislation and their superannuation entitlements are now differently administered. It would be otiose in such circumstances to give the words "incapacity for work" in s 10(1A) a construction different to the construction of "incapacity for work" when used in Workers Compensation legislation. Indeed, the gravamen of the submission put by Mr Klarica, although not articulated as such, was that the words "incapacity for work" are equivalent to the physical incapacity or, in the current case, mental incapacity which to use the term otherwise used in the Police Regulation (Superannuation) Act would be "infirmity of mind or body". Where a statute uses different words, different meaning must be assigned to them. See Favelle Mort v Murray in the High Court of Australia. It would be otiose to read "incapacity for work" as "the certified infirmity of body or mind" if Parliament wanted that to be the case, it would have used those words. It did not, and a different meaning must be ascribed. 15. On the economic material before me, there is no justification whatever for increasing the superannuation allowance currently being paid to the appellant. 16. I have inquired of counsel for the parties if any further reasons for judgment are required and I am told that none is so required. 17. For those reasons, I confirm the decision of the SAS Trustee Corporation made on 29 November 1999. Mr J J Klarica instructed by Taylor & Scott appeared for the applicant. Mr T M Ower instructed by Brian Matthews appeared for the respondent.