McGaw v Lowrie [2002] NSWCC 3

Reported Decision : 23 NSWCCR 112

Compensation Court of New South Wales

CITATION : McGaw v Lowrie [2002] NSWCC 3 PARTIES : Douglas McGaw Jason Lowrie MATTER NUMBER(S) : 12042 of2001 JUDGMENT OF: Neilson J CATCHWORDS: Proceedings to Obtain Compensation :- Commutations LEGISLATION CITED: CASES CITED: DATES OF HEARING: 30/01/02 EX TEMPORE JUDGMENT DATE : 01/30/2002

FOR APPLICANT: Mr B W Solly, Solicitor of Messrs Hunt & Hunt, Solicitors, appeared for the applicant employer.

LEGAL REPRESENTATIVES: FOR RESPONDENT: Mr P M O'Rourke instructed by Whitelaw McDonald appeared for the respondent worker.

JUDGMENT: 1. This is an application for commutation in the sum of $90,000. The application for determination was filed on 27 November 2001 at 9.18 am, the filing being done by way of facsimile transmission to the Registrar. 2. Involved in this matter is the proper construction of the Workers Compensation Act 1987, Sch 6 Pt 18C cl 11 and certain other statutory provisions. The evidence makes clear that at about 8.30 am on the morning of 27 November 2001, the worker instructed his solicitor to accept an offer which had been put to him by his employer's insurer in the sum of $90,000. Immediately after receiving those instructions, the worker's solicitor accepted, in a telephone conversation, the respondent's offer of $90,000. It can be seen therefore that approximately at 8.30 am on the morning of 27 November 2001, agreement had been reached for a commutation in the sum of $90,000. 3. The evidence deposes that "at approximately 8.48 am" the worker's solicitor conveyed to the Compensation Court of New South Wales at its Newcastle Registry, a facsimile transmission indicating that an agreement had been reached between the worker and his employer to commute the worker's ongoing weekly payments of compensation. In fact, the Court's records indicate that the facsimile transmission was sent at 8.45 am on the morning of 27 November 2001 and was received contemporaneously by the Court. 4. The substance of that letter is as follows: Re: Jason Lowrie e/b Douglas McGaw We act on behalf of the abovenamed in relation to a claim for compensation following injury sustained during his employment. Our client is currently in receipt of voluntary weekly payments from the insurer, NRMA Workers Compensation (NSW No 2) Proprietary Limited. Please be advised that our client has now accepted an offer to resolve his ongoing workers compensation entitlements by way of commutation in the sum of $90,000. An application for commutation (in triplicate) will follow by separate facsimile transmission. 5. It can be seen that this correspondence to the Registrar indicates the name of the worker, the name of the employer, the identity of the employer's insurer, the nature of the relief claimed and specifies the amount to be put forward by way of commutation. 6. That communication to the Registrar could possibly be taken to be an application for determination seeking a commutation application, when one considers the general provisions of Compensation Court Rules, Pt 32 r 2. At 9.18 on the morning of 27 November 2002, an application for determination was received by the Registrar and passed under the Seal of the Court. The full title of the application for determination is this: Application by a worker seeking a commutation of an existing award in Matter No: under the Workers Compensation Act 1987. 7. It appears clear from earlier correspondence and other evidence that there was in fact no existing award. However, it is important to note that the application for determination was filed by the worker. The document as received, in the facsimile transmission, by the Court has been subsequently amended, but when the evidence does not disclose. Originally the document had provision for the identification of the applicant worker, identification of the respondent employer, identification of the respondent's insurer and identification of the applicant's solicitor. The document has been signed "John Lewis McDonald, Solicitor for the Applicant by his employed solicitor, Doug Williams". 8. At some time, subsequent to the receipt of that document by the Registrar, the word "applicant" preceding the word "worker" has been struck out and the word "respondent" inserted. The word "respondent" qualifying both the identity of the employer and its insurer has been struck out and changed to "applicant". The identify of the applicant's solicitor has been changed to respondent worker's solicitor. The document has been re-signed by the same person who signed the original facsimile transmission and the capacity in which he has signed has been changed to this: John Lewis McDonald, solicitor for the respondent Worker by his employed solicitor, Doug Williams on behalf of the applicant employer. 9. I am aware of matters in which his Honour, the Chief Judge, Justice Campbell, has held that where a worker's solicitor has been so authorised by an insurer or an insurer's solicitor, that worker's solicitor has the legal capacity to file an application for determination on behalf of the employer. However, in the current matter, there is no evidence that the solicitor who did file the application for determination had either specific instructions or authorisation from the insurer to commence proceedings, nor can any such authority be implied. This is not due to a defect in the evidence, as the matter was specifically adjourned for a short while whilst Mr O'Rourke of counsel, who appears for the worker, sought instructions but he was unable to put before me any evidence that his solicitor was so instructed or authorised either specifically or by implication. 10. The Workers Compensation Act 1987 Sch 6 Pt 4 cl 6B provides as follows: (1) In this clause, the section 51 amendment means the amendment made to section 51(9) of this Act by the Workers Compensation Legislation Amendment Act 1998. (2) The section 51 amendment does not affect established procedure (in accordance with the relevant decisions of courts of competent jurisdiction) with respect to the operation of section 51 of this Act, namely, that the commutation of a liability to pay weekly compensation by the payment of a lump sum determined by the Compensation Court is not a payment of compensation to which the worker is entitled but a payment that the employer may make with the consent of the worker in order to commute that liability. (3) This clause applies whether the liability that is to be commuted arose before or after the commencement of this clause. (4) section 51 is taken to be amended to the extent (if any) as is necessary for the purposes of giving effect to this clause. The procedure of a worker himself applying for a commutation is specifically prevented by that legislative provision. That legislative provision appears to have been a reaction to an obiter dictum of his Honour Judge Burke in Tran v J R Manufacturing Industries Proprietary Limited (1998) 17 NSWCCR 225. 11. The reference in subclause (2) of decisions of courts of competent jurisdiction appears to me to be a reference to such authorities as Gosper v Christopherson (1986) 160CLR 423 and John While & Sons Proprietary Limited v Changleng (1987) 2NSWLR 163. However, it must be pointed out that those authorities concern "redemption" and not "commutation", and there is a major distinction between "redeeming" something, which means buying it back, and "commuting" which means merely changing it. Subclause (4) requires me to interpret the verb "commute" and the noun "commutation" as if they meant" redeem" and "redemption". 12. Leaving that to one side, it is clear that the procedure adopted in the current matter is contrary to the provisions of Sch 6 Pt 4 cl 6B. It is also contrary to the well-known practice of this Court and my decision in Romanelli v Jones trading as Chris Jones Earthmoving (unreported, 4 December 2001 Matter No 7729 of 2001). No application for determination has in fact been filed by the employer. The employer is represented today by Messrs Hunt & Hunt. They join in the submissions put to me on behalf of the worker and undertake nunc pro tunc to file an application for determination seeking a commutation if I accede to other submissions, put to me by the worker, which they support. 13. The fact is that the proceedings commenced by the worker's solicitors without authority from the employer are a gross irregularity and perhaps a nullity. However, I need not decide that issue. Mr O'Rourke of counsel for the worker and Mr Solly for the employer, both urge upon me that the relevant matter here is the fact that there had been agreement reached between the parties prior to 9 pm on 27 November 2001, that it was a common intention that an application for determination be filed in this court seeking a commutation of the employer's liability to make weekly payments to the worker and that, therefore, there was a "application for determination pending" prior to 9 am on 27 November 2001 if one interprets the word "pending" to mean "impending". This argument was raised and argued at some length earlier today in Franklins Limited v Richards Matter No 12052 of 2001. Mr O'Rourke was present when that matter was argued and said that he could not offer any further arguments than those advanced orally by Mr Barter of Counsel on behalf of Franklins Limited. 14. For reasons which I gave earlier today in Franklins Limited v Richards, I must reject that construction of Sch 6 Pt 18C cl 11. Therefore the fact that the parties had reached agreement prior to 9 am on 27 November 2001 is not sufficient ground to give this Court jurisdiction to grant the relief claimed in the application for determination. The application for determination is dismissed. 15. I am told that the employer has been supporting the worker's argument in this matter since 14 December 2001. I accordingly order the employer to pay the worker's costs incurred since 14 December 2001. Mr B W Solly, Solicitor of Messrs Hunt & Hunt, Solicitors, appeared for the applicant employer. Mr P M O'Rourke instructed by Whitelaw McDonald appeared for the respondent worker.