McCoy v Administration of Norfolk Island [2005] FCAFC 100 (30 May 2005)

Last Updated: 1 June 2005

FEDERAL COURT OF AUSTRALIA

McCoy v Administration of Norfolk Island [2005] FCAFC 100

WORKERS’ COMPENSATION – partial incapacity – periodic payments of compensation – compensation for medical expenses – Norfolk Island legislation – worker ceasing to live in Norfolk Island – whether entitlement to compensation ceased – whether entitlement to compensation subject to implied limitation that recipient remain in Norfolk Island


Employment Act 1988 (NI) ss 39, 30, 37, 65, 91, 5, 26, 27, 28, 32, 26(1), 33, 34, 35, 36, 38, 40, 41, 42, 73(1), 76, 77, 78, 85(2), 86, 92, 93, 82(10)
Norfolk Island Act 1979 (Cth) s 5
Workmen’s Compensation Act 1906 (UK)
Workers Compensation Act 1926 (NSW) s 54
Workers Compensation Act 1987 (NSW) s 53
Accident Compensation Act 1985 (Vic) s 97(2A)
Workers Compensation Act 1916-1982 (Qld) Sch cl 22
Workers Compensation Act 1971 (SA) s 56
Workers Rehabilitation and Compensation Act 1986 (SA) s 41
Workmen’s Compensation Act 1925 (UK) s 16
Safety, Rehabilitation and Compensation Act 1988 (Cth) s 120
Workers’ Compensation and Rehabilitation Act 1981 (WA) ss 69, 84C
Workers’ Rehabilitation and Compensation Act 1988 (Tas) s 83
Workers Compensation Act 1956 (NZ) s 28(4)


Ball v William Hunt & Sons, Limited [1912] AC 496
Arnotts Snack Products Pty Ltd v Yacob [1985] HCA 2; (1985) 155 CLR 171
Williams v Bill Williams Pty Ltd [1971] 1 NSWLR 547












ROBERT MCCOY v ADMINISTRATION OF NORFOLK ISLAND
N 1226 of 2004

GRAY, CONTI AND ALLSOP JJ
30 MAY 2005
SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 1226 of 2004

ON APPEAL FROM THE SUPREME COURT OF NORFOLK ISLAND

BETWEEN:	ROBERT MCCOY APPELLANT
AND:	ADMINISTRATION OF NORFOLK ISLAND RESPONDENT
JUDGES:	GRAY, CONTI AND ALLSOP JJ
DATE OF ORDER:	30 MAY 2005
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1.	The appeal be allowed.
2.	The orders of the Supreme Court of Norfolk Island made on 26 July 2004 be set aside.
3.	The matter be remitted to the Employment Tribunal to be determined according to law.
4.	The respondent pay the appellant’s costs of the appeal to the Supreme Court of Norfolk Island and of the appeal to this Court.
5.	The parties have leave within seven (7) days to move the Court for a variation to order 3 above and until the expiry of seven (7) days from today or the resolution of any such application made within seven (7) days order 3 above not be entered.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 1226 of 2004

ON APPEAL FROM THE SUPREME COURT OF NORFOLK ISLAND

BETWEEN:	ROBERT MCCOY APPELLANT
AND:	ADMINISTRATION OF NORFOLK ISLAND RESPONDENT

JUDGES:	GRAY, CONTI AND ALLSOP JJ
DATE:	30 MAY 2005
PLACE:	SYDNEY

REASONS FOR JUDGMENT

GRAY J:

The nature and history of the proceeding

1 This appeal from the Supreme Court of Norfolk Island concerns the question whether the appellant’s statutory entitlement to receive payments of workers’ compensation has been lost by reason of his departure from Norfolk Island. That question must be determined by the construction of various provisions of the Employment Act 1988 (NI) (‘the Employment Act’).

2 On 11 April 2002, the appellant was living in Norfolk Island. He was employed by a firm called Mac’s Darset Services. In the course of his employment, he suffered injuries. The Administration of Norfolk Island, the respondent to this appeal, accepted liability to pay compensation to the appellant, pursuant to Pt 3 of the Employment Act, apparently in the role of insurer of Mac’s Darset Services, pursuant to s 39 of the Employment Act. Thereafter, the appellant received payments of periodical compensation in respect of partial incapacity, pursuant to s 30 of the Employment Act, and payments of compensation for medical treatment, pursuant to s 37. The appellant then left Norfolk Island. On the ground that he had left, the Administration of Norfolk Island ceased to make payments of compensation, effective from 25 July 2003. As a result of a complaint made by the appellant to the Employment Conciliation Board, established pursuant to s 65 of the Employment Act, payments were reinstated for a brief period, but ceased again.

3 The appellant made an application to the Employment Tribunal for review of the decision to cease making payments to him. On 10 November 2003, the Employment Tribunal heard the application. On 6 January 2004, the Employment Tribunal dismissed the application. Its reasons were expressed as follows:

‘The Applicant sustained injuries during the course of his employment and as a result received benefits under the Employment Act 1988.

The Applicant departed the Island on the 6^th July, 2003 and inter-alia, as a consequence of his departure from the Island the payments of the benefits were suspended. He now claims the reinstatement of the payment of those benefits. Section 32 of the Act provides for the Medical Superintendent to assess the employee. The Applicant sought orders that the Medical Superintendent delegate his assessments to someone in Australia.

Crown Counsel submitted that section 5 of the Act limits the Act to Norfolk Island and does not extend it to Australia. He argued that monitoring of the employee needed to be performed on Norfolk Island.

The applicant had not been referred to Australia for medical reasons. Evidence was submitted where he was approved to perform light duties work. He had not made himself available to seek employment of the nature assessed as being suitable for him by listing on the Employment Register.

The Tribunal considers that arguments put were not strong enough to side with an aforementioned delegation under section 32. The Tribunal could find no specific adequate mechanism in the Act to provide for such a situation where the applicant could be monitored off Island.

Conclusion
The Tribunal considers that the application for a review is dismissed. Should Mr. McCoy return to the Island he can request another assessment.’

4 Pursuant to s 91 of the Employment Act, the appellant appealed to the Supreme Court of Norfolk Island. The court was constituted by Beaumont CJ, who heard the appeal on 16 July 2004 and delivered judgment on 26 July 2004. His Honour dismissed the appeal with costs. It is from that judgment that this appeal has been brought.

The legislation

5 By s 5 of the Norfolk Island Act 1979 (Cth), the Administration of Norfolk Island is a body politic with perpetual succession and can sue and be sued in that name. Section 5 of the Employment Act provides:

‘(1) Subject to this section, this Act applies where work is carried out by an employee in Norfolk Island, whether a contract was entered into or not, and whether the contract, if any, was entered into in Norfolk Island or elsewhere.

(2) Where an employer is not ordinarily resident in Norfolk Island, an agent, officer or employee ordinarily resident in Norfolk Island of that employer is deemed, for the purposes of this Act, to be the employer where the agent, officer or employee 

(a) is ordinarily in charge of the employer’s business in Norfolk Island;
or

(b) has entered into a contract on behalf of the employer in Norfolk
Island.

(3) This Act applies where a contract for work to be carried out elsewhere than in Norfolk Island 

(a) is made in Norfolk Island; and

(b) the employer and employee under the contract are ordinarily resident
in Norfolk Island.

(4) Where a person is employed to carry out work in Norfolk Island under a contract made in a place elsewhere than Norfolk Island and the person performs no duties under the contract on land in Norfolk Island except duties that are incidental to the performance of the principal duties of the person under the contract, this Act does not apply.’

6 The Employment Act deals with various subjects, including the terms and conditions of employment (Pt 2), occupational health and safety (Pt 4), and conciliation, adjudication and review (Pt 5). Compensation for work-related accidents is dealt with in Pt 3. Sections 26, 27 and 28 contain definitions of terms used in Pt 3. For present purposes, reference should be made to the definition of ‘incapacity’ in s 28, which is in the following terms:

‘(1) For the purposes of this Part, "incapacity", in relation to an employee, means 

(a) personal injury by reason of a work-related accident;

(b) industrial deafness within the meaning of section 33;

(c) hernia within the meaning of section 34;

(d) occupational disease within the meaning of section 35; or

(e) a cardio-vascular or cerebro-vascular episode within the meaning of
section 36,

suffered by the employee as a result of which there is a loss or diminution of the employee’s capacity to earn.

(2) For the purposes of subsection 28(1), the physical and mental consequences of personal injury referred to in paragraph 28(1)(a), or of a work-related accident, constitute incapacity in relation to an employee where, as a result of those consequences, there is a loss or diminution of the employee’s capacity to earn.

(3) Loss of amenities and of enjoyment of life because of permanent loss or impairment of a bodily or mental function of an employee by reason of an occurrence or condition specified in subsection 28(1) constitutes incapacity for the purposes of this Part, whether or not the loss or impairment results in a loss or diminution of the employee’s capacity to earn.

(4) Subject to this section, damage to the body or mind of an employee caused exclusively by disease, infection or the ageing process does not constitute incapacity for the purposes of this Part.’

7 Section 30 contains the obligation to pay periodical compensation for incapacity. The relevant provisions of that section are:

(1) Where an employee suffers incapacity, the employer shall pay to the employee periodical compensation in accordance with this section.

(2) A reference in this section to total incapacity, in relation to an employee, is a reference to total loss, whether temporary or permanent, of the employee’s capacity to earn by reason of the incapacity of the employee.

(3) A reference in this section to partial incapacity, in relation to an employee, is a reference to diminution, whether temporary or permanent, of the employee’s capacity to earn by reason of the incapacity of the employee.

(4) Where an employee suffers total incapacity, compensation shall be --

(a) payment as if the period of incapacity were a period of absence from
duty under section 18 by reason of ill health --

(i) in respect of the 5 working days next following the
commencement of the incapacity; or

(ii) where a written contract entered into in pursuance of section
10 provides for a longer period – in respect of that period; and

(b) after the expiration of the period referred to in paragraph 30(4)(a),
fortnightly payments of an amount equal to --

(i) the prescribed amount; or

(ii) the amount the employee would have received had the
employee not been suffering incapacity where that amount is
less than the prescribed amount.

(5) Subject to subsection 30(8), compensation under subsection 30(4) is payable until the employee ceases to suffer total incapacity.

(6) Where an employee suffers partial incapacity, compensation shall be paid at a rate calculated in accordance with subsection 30(4) as if the employee had suffered total incapacity, less the proportion of that rate that is equal to the proportion by which the employee’s capacity to earn is not affected by the incapacity.

(7) Subject to subsection 30(8), compensation under subsection 30(6) is payable until the employee ceases to suffer partial incapacity.

(8) Compensation under this section is not payable --

(a) after the date of death of an employee; or

(b) in respect of a period after the expiration of a period or periods
totalling 2 years of compensation payments under this section in
relation to the same incapacity;

whichever first occurs.’

8 Such machinery as exists for the assessment of compensation is found in s 32, the relevant provisions of which are:

‘(1) Subject to subsection 32(2), where an employee who suffers incapacity does not completely recover from the incapacity --

(a) the Medical Superintendent; or

(b) a person appointed by instrument in writing signed by the executive
member,

shall make an assessment of the employee in order to ascertain whether the employee has suffered permanent loss or impairment of bodily or mental function within the meaning of subsection 28(3) and the percentage, if any, of the loss or impairment.

(2) An assessment under subsection 32(1) shall be undertaken when the Medical Superintendent, or, where paragraph 32(1)(b) applies, a person referred to in that paragraph, considers that the degree of incapacity suffered by the employee has stabilised.

(3) An assessment under subsection 32(1) shall be in writing and shall --

(a) set out the nature and percentage of the permanent loss or impairment
of function, if any; and

(b) be served on the employer and employee.

(4) In making an assessment under this section --

...

(b) regard may be had to reports or advice obtained from another
medical practitioner or person practising a specialty referred
to in subparagraphs 32(4)(a)(ii) to 32(4)(a)(viii) of the
definition of "medical treatment" in subsection 26(1).’

(The figures "32(4)", which appear twice in s 32(4)(b), apparently have been inserted in error; the relevant references appear to be to subparas (a)(ii) and (a)(viii) of the definition of ‘medical treatment’ in s 26(1).)

9 Sections 33 – 36 respectively make provision for compensation for the specific conditions of industrial deafness, hernia, occupational disease, and cardio-vascular or cerebro-vascular episodes. Section 37 deals with compensation for medical treatment as follows:

‘(1) Where --

(a) compensation is payable under this Part by an employer to, or in
respect of, an employee; or

(b) but for the fact that an employee --

(i) did not suffer a loss or diminution of the employee’s capacity to
earn; or

(ii) by reason of the operation of paragraph 32(6)(a) is not entitled
to compensation under this Part,

compensation would have been payable under this Part to, or in
respect of, the employee,

the employer is liable to pay the reasonable cost of medical treatment of the injury or condition in relation to which the compensation is, or, where paragraph 37(1)(b) applies, would have been, payable.

(2) Compensation under this section is payable in addition to any other compensation payable in accordance with this Part.

(3) For the purposes of subsection 37(1), the reasonable cost of medical treatment is --

(a) the cost of medical treatment carried out in Norfolk Island with the
approval of the Medical Superintendent;

(b) where the Medical Superintendent considers it necessary for medical
treatment to be carried out in a place other than Norfolk Island – the
reasonable cost of that treatment to the extent that the employee is not
entitled to receive free or subsidised treatment at that place;

(c) the reasonable cost of transporting the employee, and, if necessary, an
escort or escorts, to and from a place referred to in paragraph
37(3)(b);

(d) the reasonable cost of accommodating an escort referred to in
paragraph 37(3)(c) at or near a place referred to in paragraph
37(3)(b); and

(e) the reasonable cost of rehabilitation services within the meaning of
section 38; and

(f) such other reasonable cost as is considered appropriate by the
executive member in the circumstances of the case.’

10 Section 38 provides:

‘The Medical Superintendent shall advise and assist a person suffering incapacity for the purpose of restoring the person, as quickly as possible, to the fullest physical and mental fitness of which the person is reasonably capable.’

11 Sections 39, 40 and 41 provide for compulsory insurance and for cases in which an employer is not insured, or where the employer ceases to exist.

12 Section 42 contains a formula for the calculation of rates of compensation, by reference to variations in the retail price index.

13 Part 5 of the Employment Act begins with s 65, which establishes the Employment Conciliation Board. By s 73(1), the functions of the Board are to inquire into and resolve matters in respect of which powers and functions are conferred on it by the Employment Act. By s 76, an aggrieved person may lodge a complaint with any member of the board concerning, among other things, non-compliance with a provision of the Employment Act, or ‘any other matter in relation to employment.’ Section 77 requires the board to endeavour to resolve a complaint by conciliation.

14 By s 78, the Court of Petty Sessions has jurisdiction to exercise and perform the powers, duties, functions and authorities conferred or imposed on it by the Employment Act. In relation to the exercise of that jurisdiction, the Court of Petty Sessions is referred to as the Employment Tribunal. Among the powers conferred on the Employment Tribunal by s 85(2) are powers to make an order requiring a person to do an act required by the Employment Act to be done, or to pay money required by the Employment Act to be paid. Section 86 requires compliance with orders of the Employment Tribunal, including payment of any money ordered to be paid within seven days after service of a copy of the order requiring payment.

15 Section 91 of the Employment Act provides for an appeal to the Supreme Court by a person who is aggrieved by a determination or order of the Employment Tribunal. By s 92, the Supreme Court has general jurisdiction to hear and determine an appeal on any question, whether of fact or law, relating to the determination or order of the Employment Tribunal from which the appeal is brought. Only in a case in which the matter in issue amounts to or is of the value of $2,500 or less is the Supreme Court’s jurisdiction limited to a question of law. It was not suggested that this limitation applies in the present case. Section 93 provides as follows:

‘(1) Subject to section 92, the Supreme Court may, on an appeal --

(a) affirm, reverse or vary the determination or order appealed from;

(b) give such judgment, or make such order, as in all the circumstances it
thinks fit, or refuse to do so; or

(c) set aside all or a part of the determination or order appealed from and
remit the proceedings to the Tribunal for further hearing or
determination, subject to such directions (if any) as the Court thinks
fit.

(2) A judgment or order under subsection 93(1) has effect as if it were a determination or order of the Tribunal and may be enforced accordingly.’

The primary judge’s reasons

16 The learned Chief Justice approached the case on the basis that it involved a question of construction of the Employment Act, which should be approached upon a consideration of the whole of the statute. In determining the proper construction, his Honour derived help from general principles applied in the interpretation of similar legislation. He referred to Ball v William Hunt & Sons, Limited [1912] AC 496 at 499 – 500, in which Earl Loreburn LC said in relation to the Workmen’s Compensation Act 1906 (UK):

‘In the ordinary and popular meaning which we are to attach to the language of this statute I think there is incapacity for work when a man has a physical defect which makes his labour unsaleable in any market reasonably accessible to him, and there is partial incapacity for work when such a defect makes his labour saleable for less than it would otherwise fetch.’

17 The Chief Justice then pointed to the acceptance of this proposition by the High Court of Australia in Arnotts Snack Products Pty Ltd v Yacob [1985] HCA 2; (1985) 155 CLR 171 at 178 – 179 per Mason, Wilson, Deane and Dawson JJ. At 178, their Honours said:

‘[T]he concept of partial incapacity for work is that of reduced physical capacity, by reason of physical disability, for actually doing work in the labour market in which the employee was working or might reasonably be expected to work.’

18 Beaumont CJ then said at [80] – [81]:

‘In my opinion, this reasoning is applicable here. The question is addressed by reference to a reasonably accessible employment market. There is nothing in the Act which negates the principle that an employee cannot proceed beyond the Island to claim for partial incapacity. This may work for or against an employee. If the employee is unable to obtain work in the Island (being the only reasonably accessible market) by reason of partial incapacity, he may be able to claim as if this were a total incapacity, at least for the time being.

There is nothing in ss 5, 7, 30, 32 or any other provision of the Act which suggests that this well-established principle cannot apply here. The result is that when the appellant decided to depart the Island of his own accord, he lost then the right to claim for partial incapacity as he moved away from the place where he might reasonably be expected to work.’

The right to receive compensation

19 The right of an employee suffering partial incapacity to receive periodical compensation is expressed clearly in s 30(1) and (6) of the Employment Act. The question is whether there is a limitation on that right, whereby it is liable to be defeated by the departure of the employee from Norfolk Island. Such a limitation is not expressed in the Act. If it exists, its existence must be the result of implication derived from the terms of the Employment Act when read as a whole, in the context of conditions prevailing in Norfolk Island. Beaumont CJ was correct to say that the question is one of construction of the Employment Act.

20 His Honour was also correct to say that the construction of the Employment Act can be assisted by principles developed by the courts in the consideration of comparable legislation. Legislative schemes for the compensation of employees injured in the course of their employment have a long history in the common law world. The Workmen’s Compensation Act 1906 (UK) is generally regarded as the prototype comprehensive legislative scheme and was copied substantially in most common law countries. It can hardly be supposed that those who framed the Employment Act did so with no regard to the provisions of such schemes already enacted by legislatures operating within the same legal tradition.

21 Counsel for the appellant attempted to argue that it was inappropriate for Beaumont CJ to have applied the principle referred to in Ball and Yacob, whereby incapacity is judged according to the capacity of the labour market in which the employee was working or might reasonably be expected to work, because of the specific definition of incapacity in the Employment Act. That definition, in s 28, refers to a loss or diminution of the employee’s capacity to earn. It is necessary to judge that capacity to earn by reference to the labour market in which the particular employee would have been expected to sell his or her labour if the injury had not occurred. An employee whose physical attributes equip him or her for manual labour, and whose education level and mental aptitude are limited, ought not to be denied compensation for incapacity on the ground that, having been deprived by injury of the necessary manual skills, he or she ought now to sell his or her labour in a market for clerical employees. Nor should an employee, prevented by injury from finding employment in a particular region, in which he or she has hitherto been employed, be prevented from receiving compensation for incapacity on the ground that suitable positions exist in some distant place. The application of the test derived from Ball and Yacob produces the result that an employee’s incapacity for work as a result of injury is to be determined according to the conditions prevailing from time to time in the kinds of employment, and the geographical area, in which the employee has worked and might reasonably have been expected to work, but for the injury.

22 It was thus appropriate that the appellant’s incapacity, and the level of it, should be determined by reference to the conditions of the labour market prevailing in Norfolk Island. For present purposes, it is sufficient to assume that it is only Norfolk Island that is relevant. There might be cases in which an employee, resident in Norfolk Island, has worked outside Norfolk Island, or might reasonably be expected to have engaged in employment outside Norfolk Island if the injury had not occurred. In such cases, the extent of the relevant market might be broader than Norfolk Island itself. As s 5(3) of the Employment Act demonstrates, the legislature contemplated that contracts of employment made in Norfolk Island might be performed outside Norfolk Island. It is also possible that the employment history of the particular employee might demonstrate a readiness to work in places other than Norfolk Island, from time to time, if the employee were fit enough to work and positions were available. It does not appear that there was evidence of the need to extend the market in the present case.

23 The question whether the appellant continued to suffer incapacity, and the extent of any continuing incapacity, were also to be judged by reference to conditions in the labour market in Norfolk Island, including any changes in those conditions from time to time. Beaumont CJ seems to have assumed that the necessity to judge the appellant’s incapacity by reference to conditions in the labour market in Norfolk Island required that he should remain in Norfolk Island. It is necessary to examine whether this assumption is correct.

24 Counsel for the Administration of Norfolk Island contended that the remoteness of Norfolk Island, the small size of its population and the limited extent of its resources were such that the presence of the appellant in Norfolk Island is necessary to enable his condition to be monitored on a continuing basis. It can be accepted readily that Norfolk Island is a small island, remote and not easily accessible, with a small population, and that the Administration of Norfolk Island has limited financial resources available to it. It is less easy to accept that these factors render it impossible to assess changes in the appellant’s condition, if he is not in Norfolk Island, or make such assessment so difficult as to warrant the implication in s 30 of the Employment Act that periodical payments of compensation for partial incapacity are to cease because of the appellant’s departure from Norfolk Island.

25 The question is made somewhat more difficult than it might be by the absence from the Employment Act of machinery provisions for bringing about the cessation of payments of compensation for incapacity. Section 32 provides for an initial assessment. Although s 30(5) and (7) contemplate that compensation would cease to be payable if the employee were to cease to suffer total, or partial, incapacity respectively, the Employment Act contains no provision for the making of any assessment of whether an employee had ceased to suffer incapacity. Counsel for the Administration of Norfolk Island informed the Court that such an assessment is in fact conducted informally. The officer whose task it is to administer the compensation scheme under the Employment Act is the same officer who manages what the Employment Tribunal called the Employment Register. The Employment Register is a mechanism, without any statutory authority, for bringing together those who are seeking work and those who require employees to perform work for them. It appears that the practice is to require a person in receipt of compensation for incapacity to be on the Employment Register. If by this means the person is able to obtain a job within his or her capacity, the fact of obtaining the job is used as a reason for ceasing payments of compensation. This practice might be justified by reference to the obligation imposed on the Medical Superintendent by s 38 of the Employment Act. No doubt, if a person were to obtain employment through this, or any other, means, that would be regarded as a proper reason for ceasing to make payments of compensation.

26 It can be understood that such a system is convenient. The fact that it has no statutory foundation is significant, however. It can also be understood that the presence of a recipient of compensation in Norfolk Island makes it easier for that person’s condition to be monitored. If the need for compensation has ceased, because the person’s condition has improved, that is a fact likely to become known among a small population. This means that the incidence of fraud in the system is very likely to be reduced.

27 It must be recognised, however, that there are other ways in which changes in the condition of a compensation recipient can be assessed. Even in the absence of statutory authority, it should be possible to request that the person respond to periodical questionnaires about whether he or she is engaging in employment and, if so, of what kind or kinds. A person’s condition can be assessed from time to time by reference to expert medical opinion. Periodical requests for the person to provide a report of a treating medical practitioner, or even of an expert medical practitioner nominated by the Administration of Norfolk Island, would appear to be reasonable, unless the requests were made so frequently as to be oppressive. There may even be cases in which it would be appropriate to invite a compensation recipient to be examined by the Medical Superintendent in Norfolk Island, for the purpose of assessing whether that person had ceased to suffer incapacity, or the level of incapacity had been reduced. All of these methods can be adopted whether or not the compensation recipient continues to reside in Norfolk Island. The obtaining of expert medical opinion might even be made easier by the presence of the person elsewhere. Despite the remoteness of Norfolk Island, postal and electronic communications are no doubt available to make the transmission of the requisite information simple and inexpensive.

28 For these reasons, the particular circumstances of Norfolk Island do not warrant the implication in s 30 of the Employment Act of a limitation on the right to receive periodical payments of compensation, to the effect that such a right only endures so long as the recipient remains in Norfolk Island. A number of other reasons support the view that such an implied limitation does not exist.

29 It is a well-established principle that legislation of this kind ought to receive a liberal construction. See, for instance, Williams v Bill Williams Pty Ltd [1971] 1 NSWLR 547 at 553 per Asprey JA. Because Pt 3 of the Employment Act is intended to be beneficial legislation, providing entitlements to injured employees, the Court should not be too ready to construe it against the interests of those employees.

30 Section 30 of the Employment Act contains express provisions for the cessation of payments of periodical compensation. Reference has already been made to subss (5) and (7), which make it clear that compensation is only payable until an employee ceases to suffer total, or partial, incapacity respectively. In addition, there are the limitations upon the liability to pay compensation in s 30(8), particularly that in par (b). The effect of that provision is that periodical compensation is only payable for a total of two years. These provisions indicate that the legislature turned its attention to the question of cessation of periodical compensation when it enacted s 30. In doing so, it failed to provide expressly for a geographical limitation. This makes it all the more difficult to argue for the implication of such a limitation. Section 5 of the Employment Act does not provide such a limitation. Rather, it is a provision expanding the operation of the Employment Act. Thus, the Employment Act applies to work carried out in Norfolk Island, even if the contract was entered into elsewhere (subs (1)) and applies to work carried out outside Norfolk Island pursuant to a contract made in Norfolk Island between residents of Norfolk Island (subs (3)). Section 5 was not intended to be, and cannot be read as, a limitation on the effect of the rights given in s 30.

31 Further, when the legislature came to consider the provisions of Pt 3 of the Employment Act, it had available to it any number of provisions in comparable legislation elsewhere, imposing geographical limits on the right to continue to receive compensation. Such provisions are, or have been, found in s 54 of the Workers Compensation Act 1926 (NSW), s 53 of the Workers Compensation Act 1987 (NSW), s 97(2A) of the Accident Compensation Act 1985 (Vic), cl 22 of the Schedule to the Workers Compensation Act 1916-1982 (Qld), s 56 of the Workers Compensation Act 1971 (SA), s 41 of the Workers Rehabilitation and Compensation Act 1986 (SA) and s 16 of the Workmen’s Compensation Act 1925 (UK). There are also provisions requiring compensation recipients to give notice of departure (s 120 of the Safety, Rehabilitation and Compensation Act 1988 (Cth)) and provisions as to the manner in which those who have departed are required to prove their continuing entitlements (ss 69 and 84C of the Workers’ Compensation and Rehabilitation Act 1981 (WA), s 83 of the Workers’ Rehabilitation and Compensation Act 1988 (Tas) and s 28(4) of the Workers Compensation Act 1956 (NZ)). It is significant that the Norfolk Island legislature did not adopt any of these existing models, when it came to consider the form of s 30 of the Employment Act.

32 To construe s 30 of the Employment Act so as to disentitle a compensation recipient to compensation upon his or her departure from Norfolk Island would be an undue constraint on the liberty of the person to choose where he or she wishes to live. There can be no doubt that such a constraint could be imposed expressly by legislation, but the infringement of liberty is a powerful reason for holding that the constraint should not be implied.

33 For all of these reasons, there is no implied limitation in s 30 of the Employment Act on the entitlement of a person to continue to receive periodical payments of compensation for incapacity, where the person has departed from Norfolk Island.

34 Section 37, which relates to compensation for the cost of medical treatment, contains specific provisions as to the place where the medical treatment might be carried out. Section 37(3)(a) provides for compensation for the cost of medical treatment carried out in Norfolk Island with the approval of the Medical Superintendent. By s 37(3)(b), there might also be compensation for the cost of medical treatment carried out elsewhere, if the Medical Superintendent considers it necessary for it to be so carried out. Because of the specific provisions, the reasoning applicable to s 30 does not apply and effect must be given to the terms of s 37. Before the appellant will be entitled to compensation for the cost of medical treatment carried out in a place other than Norfolk Island, the Medical Superintendent will have to decide in each case whether its necessary for that medical treatment to be carried out in a place other than Norfolk Island.

Conclusion

35 For the above reasons, Beaumont CJ was in error in dismissing the appeal before him. The appeal to this Court must be allowed. The orders of the Supreme Court of Norfolk Island must be set aside. In lieu of those orders, there should be an order allowing the appellant’s appeal to the Supreme Court of Norfolk Island from the Employment Tribunal.

36 Because the effect of the judgment in this appeal is to resolve the issue that was before both the Employment Tribunal and the Supreme Court, it would be prudent to make orders resolving the matter altogether. Pursuant to s 93(1)(a) of the Employment Act, there should be an order reversing the determination of the Employment Tribunal. Pursuant to s 93(1)(b), there should be an order substituting for the determination of the Employment Tribunal an order requiring the Administration of Norfolk Island to pay to the appellant periodical payments of compensation in respect of his partial incapacity, in accordance with s 30 of the Employment Act. There should also be an order requiring the Administration of Norfolk Island to pay the appellant’s costs of the proceeding in the Supreme Court. Section 82(10) of the Employment Act prohibits the Employment Tribunal from making an order as to costs. The Administration of Norfolk Island should be ordered to pay the costs of the appeal to this Court.

I certify that the preceding thirty-six (36) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Gray.

Associate:

Dated: 26 May 2005

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	N 1226 of 2004

ON APPEAL FROM THE SUPREME COURT OF NORFOLK ISLAND

BETWEEN:	ROBERT MCCOY APPELLANT
AND:	ADMINISTRATION OF NORFOLK ISLAND RESPONDENT

JUDGE:	GRAY J
DATE:	30 MAY 2005
PLACE:	SYDNEY

REASONS FOR JUDGMENT

CONTI AND ALLSOP JJ

37 We have had the considerable advantage of reading in draft the reasons of Gray J. With the exception of one aspect of the orders that his Honour proposes, we agree with his Honour’s reasons and proposed orders.

38 We would not make an order requiring the Administration of Norfolk Island to pay periodical payments to the appellant. The orders sought by the appellant in his Amended Notice of Appeal were as follows:

(b) The Appeal is allowed.
(c) The orders of the court below is (sic) set aside. In lieu thereof order that the appeal to the Supreme Court of Norfolk Island from the Employment Tribunal be upheld.
(d) The Respondent pay the Appellant’s costs of the appeal and in the court below.
(e) Order that the matter be remitted to the Supreme Court of Norfolk Island to be determined in accordance with the law.
(f) Further or other orders.

39 In the exercise of this Court’s appellate jurisdiction, we are not limited to making orders (a) to (d) as sought. Under s 28 of the Federal Court of Australia Act 1976 (Cth) this Court may make such orders as the primary judge could have made sitting, as his Honour was, as the Chief Justice of Norfolk Island. The powers of the Supreme Court on appeal from the Employment Tribunal are contained in s 93 which is in the following terms:

93 (1) Subject to section 92, the Supreme Court may, on an appeal –

(a) affirm, reverse or vary the determination or order appealed from;
(b) give such judgment, or make such order, as in all the circumstances it thinks fit, or refuse to do so; or
(c) set aside all or a part of the determination or order appealed from and remit the proceedings to the Tribunal for further hearing or determination, subject to such directions (if any) as the Court thinks fit.

(2) A judgment or order under subsection 93(1) has effect as if it were a determination or order of the Tribunal and may be enforced accordingly.

40 Given that the Tribunal’s reasons were limited to the question of departure and its effect, it is difficult to know with either precision or confidence whether any other matter is unresolved between the parties or at least unarticulated as an aspect of their dispute. For this reason, if there is to be any order made beyond the orders sought by the parties, we would limit it to an order remitting the matter to the Employment Tribunal.

41 We see little purpose in remitting the matter to the Supreme Court. The issue before the Supreme Court was that which was argued on appeal. This has been dealt with. In these circumstances the matter should be remitted to the Employment Tribunal to deal with according to law.

42 However, the appellant was represented by experienced solicitors and experienced senior counsel. There may be a reason why orders should be framed in accordance with the notice of appeal. Also, it may be that the respondent does not oppose an order in the terms proposed by Gray J. In order to accommodate these possibilities we would provide an opportunity within 7 days to move the Court for orders as sought in the notice of appeal or as would be made by Gray J.

43 The orders that we would make are:

1.	The appeal be allowed.
2.	The orders of the Supreme Court of Norfolk Island made on 26 July 2004 be set aside.
3.	The matter be remitted to the Employment Tribunal to be determined according to law.
4.	The respondent pay the appellant’s costs of the appeal to the Supreme Court of Norfolk Island and of the appeal to this Court.
5.	The parties have leave within seven (7) days to move the Court for a variation to order 3 above and until the expiry of seven (7) days from today or the resolution of any such application made within seven (7) days order 3 above not be entered.

I certify that the preceding seven (7) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Conti and Allsop.

Associate:

Dated: 30 May 2005

Counsel for the appellant:	L King SC
Solicitor for the appellant:	Beilby Poulden Costello
Counsel for the respondent:	S Kilkenny
Date of Hearing:	28 February 2005
Date of Judgment:	30 May 2005