Thelma De La Cruz v Australian Postal Commission [1997] FCA 126 (27 February 1997)

CATCHWORDS

WORKERS COMPENSATION - Commonwealth employees - Request for review of entitlements - Reconsideration of determination of entitlements - Whether second reconsideration is allowed under the Safety Rehabilitation and Compensation Act, s62 - Meaning of determining authority under Safety Rehabilitation and Compensation Act, s60 - Meaning of determination under s62 of Safety Rehabilitation and Compensation Act

STATUTORY INTERPRETATION - discussion of approach to construction of legislation considering further reconsideration of determination of entitlements - whether Safety Rehabilitation and Compensation Act s62 allows further reconsideration of original determination

Safety Rehabilitation and Compensation Act 1988 (Cth), ss 11, 24,25,26,27,45,60,62,64

No. 727 of 1996

THELMA DE LA CRUZ v. AUSTRALIAN POSTAL COMMISSION

Emmett J

Sydney

27 February 1997

IN THE FEDERAL COURT OF AUSTRALIA	)
	)
NEW SOUTH WALES DISTRICT REGISTRY	) No.727 of 1996
	)
GENERAL DIVISION	)

BETWEEN:	THELMA DE LA CRUZ Applicant
AND:	AUSTRALIAN POSTAL COMMISSION Respondent
CORAM:	EMMETT J.
PLACE:	SYDNEY
DATED:	27 FEBRUARY 1997

MINUTES OF ORDER

The Court orders that:

1. The application be dismissed.

2. The applicant pay the respondent's costs.

IN THE FEDERAL COURT OF AUSTRALIA	)
	)
NEW SOUTH WALES DISTRICT REGISTRY	) No.727 of 1996
	)
GENERAL DIVISION	)

BETWEEN:	THELMA DE LA CRUZ Applicant
AND:	AUSTRALIAN POSTAL COMMISSION Respondent
CORAM:	EMMETT J.
PLACE:	SYDNEY
DATED:	27 FEBRUARY 1997

REASONS FOR JUDGMENT

The Respondent ("Australia Post") is the holder of a class 3 licence under the Safety Rehabilitation and Compensation Act 1988 ("the Compensation Act"). Accordingly, under section 24(1) of the Compensation Act where an injury to an employee of Australia Post results in a permanent impairment, Australia Post is liable to pay compensation to the employee in respect of the injury. The Applicant was an employee of Australia Post and in the course of her employment she suffered an injury. On 25 August 1993, the Applicant made an application for compensation for permanent impairment as a result of that injury.

Section 24(5) of the Compensation Act therefore required that Australia Post determine the degree of permanent impairment of the Applicant under the provisions of "the approved Guide" as defined in the Compensation Act. Under section 24(6) the degree of impairment was required to be expressed as a percentage. Subject to a presently irrelevant exception, under section 24(7), where Australia Post determined that the degree of permanent impairment was less than 10%, no amount of compensation was payable to the Applicant under section 24.

On 30 November 1995 a determination was made by Ms T. Baskoutas, a delegate of Australia Post, that the injury to the Applicant had resulted in permanent impairment but that the degree of permanent impairment was less than 10%. On the basis of that determination, no compensation was payable. On 15 December 1995 the Applicant requested Australia Post to reconsider that determination pursuant to section 62(2)(a). Under section 62(4), on receipt of such a request, the delegate who made the determination became bound to reconsider the determination or procure the determination to be reconsidered by another delegate. Section 62(5) provides that where a person reconsiders a determination, the person may make a decision affirming or revoking the determination or varying the determination in such manner as the person thinks fit.

On 29 February 1996, Mr Neil Williams, another delegate of Australia Post, reconsidered the determination made by Ms Baskoutas and varied the decision of 30 November 1995. His decision was that, as a result of the relevant injury, the Applicant has a 10% permanent impairment and that Australia Post was liable to pay compensation in respect of that impairment.

On 1 April 1996, the Applicant's Solicitors requested particulars of the lump sum to which the applicant would be entitled pursuant to sections 24 and 27 of the Compensation Act. In response, Australia Post wrote to the Applicant direct on 3 May 1996 saying, inter alia, as follows:

"... you are entitled to compensation under Section 24 and 27 of the Act for the impairment and non-economic loss and the degree of that impairment is 10% which equates to a lump sum amount of $25,463.73.

Prior to any payment for a permanent impairment claim an election must be made under Section 45 of the above Act."

It is common ground between the parties that the latter statement was at best misleading. Section 45(1) has the effect that where compensation is payable under sections 24, 25 or 27 and Australia Post would be liable for damages for any non-economic loss suffered by the employee as a result of the injury, the employee may, at any time before an amount of compensation is paid to the employee under those sections, elect in writing to institute an action or proceeding against Australia Post for damages for that non-economic loss. Under section 25(3) an election is irrevocable. Where an employee makes an election, compensation is not payable under section 24, section 25 or section 27 after the date of the election in respect of the injury.

Upon receipt of the document enclosed with the letter of 3 May 1996, the Applicant signed it and returned it to Australia Post. The document was expressed to be an election:

"to receive compensation under the Commonwealth Employees' Rehabilitation and Compensation Act of 1988 for my permanent impairment and non-economic loss."

The document contained an acknowledgment that the effect of being paid compensation would be that the Applicant would not, at a later date, be able to sue Australia Post for damages for that impairment. It is, thus, clear that the author of the document misconceived the effect of section 45 which calls only for an election to institute proceedings. There is no requirement to elect in favour of receipt of a payment.

However, an election would be made, in effect, upon acceptance of the payment of compensation. The document should properly be construed, therefore, as having no greater effect than as a statement by the Applicant that it was her intention to accept compensation in satisfaction of any rights which she had. Nothing was advanced by either party to suggest that it had any greater effect.

On 5 July 1996, apparently without any prior warning, Mr Williams, the delegate of Australia Post, wrote to the Applicant's solicitors saying, inter alia, the following:

"In light of recent medical evidence received by this office I set aside the previous reconsideration dated 29 February 1996.

Having regard to the evidence before me I now AFFIRM the delegate's decision of 30 November 1995."

While, in the letter, Mr Williams said that he "set aside the previous reconsideration", counsel for Australia Post accepted that that part of the letter was "otiose". It was clearly misconceived on the basis of the analysis which I have adopted below in relation to section 62(1).

The letter also made reference to a report of 18 June 1996 from Dr Olsen, Consultant Occupational Physician and Consulting Engineer, and went on to say:

"Dr Olsen's estimate of permanent impairment is 15%. Given that the evidence indicates that the effects of the first incident (22 October 1987) remained constant after that date, it is reasonable to conclude that any impairment resulting from that incident became permanent prior to 1 December 1988. This impairment is therefore not compensable. When Dr Olsen's figure of 15% is halved the impairment percentage falls below the threshold of 10%."

The application before the Court is for review of the decision evidenced by the letter of 5 July 1996. Three alternate bases were advanced by the Applicant in support of the relief sought. The first basis concerns the effect of section 62 of the Compensation Act. In supporting the decision of 5 July (purporting to affirm the determination of 30 November 1995), Australia Post relies upon section 62(1) of the Compensation Act which relevantly provides as follows:

"(1) A determining authority may, on its own motion:

(a) reconsider a determination made by it; or

(b) cause such a determination to be reconsidered by a person to whom its power under this section is delegated, being a person other than the person who made, or was involved in the making of, the determination;

whether or not a proceeding has been instituted or completed under this Part in respect of a reviewable decision made in relation to that determination."

The expression "determining authority" is defined in section 60(1) as meaning the person who made the determination. The term "reviewable decision" is relevantly defined as meaning a decision made under section 62.

It is apparent that section 62(1) authorises a reconsideration only of a "determination" as defined. Under section 60(1) that term relevantly means, for present purposes, a determination made under section 24. It does not include a decision made under section 62(5) affirming, revoking or varying a determination after reconsidering it.

The contention of the Applicant was that there is to be found in section 62(1) a limitation on the number of occasions on which a determining authority may, on its own motion, reconsider a determination or cause a determination to be reconsidered. It was said that Mr Williams purported to exercise the power conferred by section 62(1) on two occasions, namely, 29 February 1996 and 5 July 1996 and that that was impermissible. It was contended that a construction of section 62(1) which authorised unlimited reconsideration is one to be avoided; otherwise, there could be difficulties in achieving finality.

For example section 26(1) provides that an amount of compensation payable to an employee under section 24 is to be paid to the employee within 30 days after the date of the assessment of the amount. However, under section 26(4), that provision does not apply where Australia Post has been requested under Part VI, which includes section 62, to reconsider a determination under section 24 or where a proceeding in respect of such a determination has been instituted under Part VI. Thus, once the process of reconsideration has been commenced, there is no longer any time fixed for payment of the amount of compensation. The consequence of that may be that interest, which is provided for under section 26(2), is not payable.

Under section 11 of the Compensation Act, it is made clear that Australia Post would have a liability to pay to the Applicant such amounts as are determined to be payable under Act. The Act itself, by the operation of section 69(a) and section 107M(3), requires that Australia Post make determinations accurately and quickly in relation to claims that it is authorised to determine and to make payments accurately and quickly in accordance with determinations in discharge of its liability under the Compensation Act to pay compensation. Those provisions suggest that a construction of section 62(1) should be avoided which would permit, at least in theory, an unlimited number of reconsiderations of a determination.

The reconsideration which occurred on 29 February 1996 was a reconsideration pursuant to the request made by the Applicant under section 62(2)(a). It was not an exercise of power under section 62(1). Accordingly, any purported exercise of power on 5 July 1996 was the first exercise of power under section 62(1). Thus, even if there were to be read into section 62(1) a limitation on the number of reconsiderations which can be undertaken pursuant to that provision, in the present case, there was only one reconsideration under that provision.

It is clear from the terms of section 62(1) that there can be an exercise of power under that provision after there has been a reconsideration pursuant to section 62(2). That must be so because the reconsideration may be made even though in respect of a reviewable decision. There can be no application to the Administrative Appeals Tribunal under section 64 for review of a determination made under, for example, section 24. A dissatisfied claimant must first request reconsideration under section 62(2) and has the right to have reviewed by the Tribunal the decision made on such reconsideration. Similarly, any reconsideration by a determining authority on its own motion under section 62(1) gives rise to a decision which may be the subject of review by the Tribunal pursuant to section 64.

Reviewable Decision relevantly means, for present purposes, a decision made under section 62. It must follow that the power of reconsideration under section 62(1) can be exercised after there has been a reconsideration pursuant to section 62(2) which gives rise to a reviewable decision. It also appears to follow that, since a reviewable decision might arise from the exercise of power under section 62(1), there might be a further exercise of power notwithstanding that a proceeding has been instituted in respect of that first reconsideration under section 62(1).

A question may arise as to the meaning of the term "determining authority" in section 62. As I have indicated, the term is defined in section 60(1) as meaning, in relation to a determination, the person who made the determination. The reference to "person" suggests an individual rather than a licensed authority such as Australia Post.

As I have said, the determination of 30 November 1995 was made by Ms T. Baskoutas.

If "determining authority" in section 62(1) refers to the individual who made the determination, the reference in relation to the decision of 30 November 1995 would be to Ms Baskoutas. It would follow that the power, either to reconsider that determination or to cause that determination to be reconsidered, was vested in Ms Baskoutas. Only Ms Baskoutas could have reconsidered the determination which she made on 30 November 1995 unless she caused that determination to be reconsidered by Mr Williams. There is no indication that Ms Baskoutas had anything to do with the reconsideration by Mr Williams on 5 July.

On the other hand, section 62(1)(b) speaks of a determining authority causing a determination to be reconsidered by a person "to whom its power under this section is delegated". That reference appears to suggest that "determining authority" is the licensed authority which delegates power to an individual.

The apparent tension in the language of section 62(1) would be resolved if the words "if a person who made the determination" in the definition of "determining authority" were taken to refer to the licensed authority who made the determination, albeit through a delegate appointed under section 107T of the Act. That section authorises a licensed authority to delegate to an officer of or a person employed by that authority any of the powers and functions of the licensed authority under the Act.

The preferable construction, therefore, appears to me to be that, for the present case, determining authority in section 62(1) refers to Australia Post. Thus, assuming that relevant powers and functions have been delegated to Mr Williams under section 107T, as to which there was no challenge, the exercise of power under section 62(1) by the reconsideration of the determination of 30 November 1995 was effective. That would be so even if there is to be read into section 62(1) a limitation on multiple exercise of the power to reconsider on the motion of the determining authority. That would dispose of the first basis for impugning the decision of 5 July 1996.

The second basis upon which the decision is sought to be impugned relates to the circumstances surrounding the election form to which reference has been made above. It was contended that the failure by Mr Williams to take into consideration, when making the decision of 5 July 1996, the fact that the election form had been signed and returned to Australia Post was a failure to take into account a relevant consideration.

It was suggested that the signing of the election document was in some way prejudicial to the Applicant. The contention was that the document may be an admission which could be tendered against her in any proceedings she elected to commence for recovery of common law damages. It was contended that the Applicant had, by the document, indicated her intention to abandon her potential common law rights to claim damages in consideration of the payment of compensation under the Act.

I do not consider that the signing of the document was a relevant consideration for Mr Williams as the delegate of Australia Post. It is no more than a statement of present intention. There is no reference in the document to quantum of impairment or the amount of compensation which would be payable. It does not constitute an admission against her interest by the Applicant which could be tendered against her to her prejudice. Accordingly, I do not consider that it was relevant for a delegate reconsidering a determination pursuant to section 62(1) to take into account the signing of the document.

It may be arguable that, if one can distinguish a separate decision, namely a decision to undertake a reconsideration, the fact of the election could conceivably be a relevant consideration. It may be thought that, once such a document had been sent to an employee, there would be an expectation on the part of the employee that the matter had reached finality and that it would be, in some sense, unfair, having induced that expectation, to proceed to a reconsideration.

However, there is no suggestion of any actual detriment to the Applicant by reason of her having acquired such an expectation. The only detriment averted to was the possibility of having the document tendered against her as an admission. I do not consider that this ground is made out.

The third basis upon which the decision of 5 July 1996 is impugned relates to the use made by Mr Williams of the report of Dr Olsen of 18 June 1996. The Applicant relied on the fact that Dr Olsen's second report did not appear to have been based upon a fresh examination nor any other new information supplied to him. It was pointed out that there was nothing to indicate why the report had not been obtained before the decision of 29 February 1996, or why it was obtained after that decision. The suggestion seems to have been that Dr Olsen's second report provided no basis for alteration of the view which had been formed on 29 February 1996.

Reliance was placed on the language of the letter of 5 July 1996 as indicating that Mr Williams was reconsidering his decision of 29 February 1996. However as I have said, a reconsideration made under section 62(1) is a reconsideration of the original determination and not of some earlier reconsideration. Once that is accepted, this argument appears to me to fall away.

While it is clearly misconceived to speak of setting aside an earlier consideration, as the letter of 5 July 1996 does, the language of the letter of 5 July 1996 indicates that the exercise which was carried out was indeed one of reconsideration of the original determination. The operative provision of the letter is the statement set out above whereby Mr Williams purported to "AFFIRM the delegate's decision of 30 November 1995." Mr Williams also says in the letter:

"Therefore, having now considered the additional report of Dr Olsen which clarifies his earlier report dated 24 August 1994 I am not satisfied ... that your client has an entitlement to a payment for whole person permanent impairment."

Counsel for the Applicant also contended that Dr Olsen had not:

purported to make any assessment under the relevant table in the "approved Guide",

provided any apportionment under the approved Guide of functional impairment between two incidents in which the Applicant had been injured; or

provided any indication of when any impairment referable to the earlier of the two incidents became clear.

However, it was conceded by counsel for the Applicant that the decision of 5 July 1996 would have been open to Mr Williams on 29 February 1996, if he had had before him, in addition to all of the evidence and materials which were then available, the further report of Dr Olsen. Since, on the proper analysis of section 62(1), Mr Williams was reconsidering, not his decision of 29 February 1996, but the determination of 30 November 1995, that concession seems to me to dispose of the argument. So long as the decision was open to Mr Williams on all of the material then available to him, the circumstances surrounding the second report are irrelevant.

In the light of those conclusions the application should be dismissed with costs.

I certify that this and the preceding sixteen pages are a true copy of the Reasons for Judgment of his Honour Justice Emmett

Associate

Date

Heard: 18 February 1997

Place: Sydney

Decision: 27 February 1997

Appearances: Mr L.T.Grey appeared, instructed by Somerville & Co for the applicant.

Ms Christine Adamson appeared, instructed by the Australian Government Solicitor for the respondent.