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Mihaljcic and Linfox Australia Pty Ltd [2010] AATA 599 (13 August 2010)

Last Updated: 16 August 2010

Administrative Appeals Tribunal

INTERLOCUTORY DECISION AND REASONS FOR INTERLOCUTORY DECISION [2010] AATA 599

ADMINISTRATIVE APPEALS TRIBUNAL )

) Nº 2008/6162, Nº2009/2009

GENERAL ADMINISTRATIVE DIVISION
)

Re
GORAN MIHALJCIC

Applicant
And
LINFOX AUSTRALIA PTY LTD

Respondent

INTERLOCUTORY DECISION

Tribunal
Mr John Handley, Senior Member

Date 13 August 2010

Place Melbourne

Decision
For the reasons which follow, particularly at paragraph 46, if within four weeks, the Tribunal is advised that a request for reconsideration of the decision made by the Respondent on 1 December 2008 has not been made, I will, subject to any further Direction or application cause these applications to be listed for a resumption of the dismissal hearing.


(sgd) John Handley
Senior Member

PRACTICE AND PROCEDURE – dismissal application - applications to review two decisions to disentitle continuing weekly compensation – Applicant did not undertake a rehabilitation program – employer issued a determination to suspend rights to compensation and to institute or continue proceedings– Applicant has not applied for reconsideration – reviewable decision not made – jurisdiction of Tribunal to review suspension – status of substantive applications for review.

Administrative Appeals Tribunal Act 1975 (Cth) s 29(7), s 42A and s 42AB,

Safety, Rehabilitation and Compensation Act 1988 (Cth) s 4, s 37, s 37(7), s 60, s 61, s 62, s 62(3), s 63 and s 64


Australian Postal Corporation v Forgie and Anor [2003] FCAFC 223; (2003) 130 FCR 279

Re Marnotta Pty Ltd and Secretary, Department of Health and Ageing [2004] AATA 326; (2004) 82 ALD 514

Transurban Citylink Ltd v Allen [1999] FCA 1723; (1999) 168 ALR 687

Fearnley v Australian Fisheries Management Authority (2006) 94 ALD 519

Guse v Comcare [1997] FCA 140; (1997) 49 ALD 288

REASONS FOR INTERLOCUTORY DECISION


13 August 2010
Mr John Handley, Senior Member

  1. The Applicant suffered injury described as a temporary exacerbation of cervical disc disease and cervical root irritation in his employment with the Respondent in December 2007. The Applicant has been incapacitated from time to time subsequently, and the Respondent has accepted liability to pay compensation until 22 September 2008.
  2. The Applicant has applied for review of two reviewable decisions made by the Respondent. The Respondent contends that the decisions are not reviewable by the Tribunal and should be dismissed. It asserts that the applications should not have been instituted and relies on s 37(7) of the Safety, Rehabilitation and Compensation Act 1988 (the SRC Act).
  3. The circumstances giving rise to these reviews are chronologically summarised as follows.

APPLICATION Nº 2008/6162

  1. The Applicant signed a return to work plan (described as an offer of suitable duties) which he was due to commence on 22 September 2008 (T53, p 207-212). It was devised by the Respondent and regarded as a rehabilitation program. The Respondent alleged that the Applicant failed or refused to comply with, or commence the plan.
  2. On 8 October 2008, the Applicant’s solicitors wrote to the Respondent and advised that his general practitioner had prepared a modified return to work plan. The Respondent prepared a further plan that was due to commence on 20 October 2008.
  3. On 14 October 2008 the claims agent of the Respondent (CGU Self Insurance Services (CGU)) made two decisions, namely to:
  4. The Applicant did not commence the return to work plan on 20 October 2008. On 21 October 2008, the Respondent wrote to him directly and notified him that he had again refused or failed to undertake a rehabilitation program without reasonable excuse. It also advised that his rights to compensation and to institute or continue proceedings under the SRC Act would be automatically suspended unless he commenced the rehabilitation program immediately or provided written reasons for his refusal or failure, as it alleged, within 14 days (T59, p236).
  5. On 3 November 2008, the Applicant's solicitors wrote to CGU requesting reconsideration of the decision made on 14 October 2008 to deny entitlement to weekly compensation for the period 22 September 2008 to 17 October 2008 pursuant to s 62 of the SRC Act. It is implicit the request for review concerned the second decision, although not specifically stated.
  6. On 19 November 2008, CGU made a reviewable decision in response to the Applicant's request for reconsideration. It affirmed the decision denying entitlement between 22 September 2008 and 17 October 2008. By its own motion, it also revoked the other decision made on 14 October 2008 to accept liability between 29 September 2008 and 5 October 2008.
  7. On 1 December 2008, the Respondent issued a determination pursuant to s 37(7) of the SRC Act and decided that the Applicant had:
...failed, without reasonable excuse, to undertake the rehabilitation programs dated 22 September and 16 October 2008. Consequently, your compensation entitlements are suspended by operation of subsection 37(7) from the date of this determination. Your rights to institute or continue proceedings under the Act are similarly suspended. No compensation can be paid to you during the period of suspension.
You have a right to request Linfox to review my decision under section 38 of the Act. Your rights are fully explained in the attached rehabilitation programs under section 37 of the SRC Act 1998. (T66, p259-261).
  1. On 24 December 2008, the Applicant lodged an application for a review of the reviewable decision made on 19 November 2008.

APPLICATION Nº 2009/2009

  1. On 18 November 2008, CGU denied the Applicant’s claim for weekly compensation between 20 October 2008 and 12 December 2008 (T75, p295-297). On 27 November 2008 the Applicant's solicitors requested a review of the decision pursuant to s 62 of the SRC Act.
  2. On 17 December 2008, CGU affirmed the determination made on 18 November 2008.
  3. On 7 May 2009 the Applicant's solicitors lodged an application for review of the reviewable decision made on 17 December 2008, together with an application for an extension of time. On 10 June 2009, the Respondent consented to an extension of time. On 12 June 2009 the Tribunal (differently constituted) made an Order extending the time to lodge application Nº 2009/2009 pursuant to s 29(7) of the Administrative Appeals Tribunal Act 1975 (the AAT Act).

DISMISSAL APPLICATION

  1. On 21 October 2009, prior to an interlocutory hearing, the Applicant's solicitors lodged a Statement of Legal Argument. The solicitors conceded that the determination made by the Respondent on 1 December 2008 (refer paragraph 10) caused the Applicant's rights to compensation and to institute or continue proceedings under the SRC Act to be suspended pursuant to s 37(7) of the SRC Act.
  2. During oral argument before the Tribunal on 10 March 2010, the Applicant's representative lodged a medical certificate as evidence of the Applicant’s incapacity from 21 December 2009 to 20 January 2010. It was contended that the certificate purporting to evidence incapacity constituted the reasonable excuse of the Applicant for failing to undertake the rehabilitation programs arranged by the Respondent. The Applicant did not appear personally nor was an Affidavit lodged by him before or during the hearing.
  3. The Respondent’s representative contended that the concession made by the Applicant in the Statement of Legal Argument amounted to an admission that both applications should not have been instituted nor should they be permitted to continue. It was also contended that the concession made by the Applicant's representative in the document of 21 October 2009 was absent any disclosure or pleading of any excuse, whether reasonable or otherwise, for the refusal or failure to participate in the rehabilitation programs.
  4. Additionally, it was contended by the Respondent's representative that the Applicant has not personally, nor by his solicitors sought a reconsideration of the determination made by the Respondent on 1 December 2008 to suspend his rights under the SRC Act. Therefore, a reviewable decision has not been made and the Tribunal does not have jurisdiction to review the determination. As the suspension decision, as alleged, remained operative, the Respondent argued that the Applicant is unable to proceed with the applications currently before the Tribunal and they should be dismissed.

IS THE SUSPENSION DETERMINATION LAWFUL?

  1. After the hearing on 10 March 2010, I sought further information from the Respondent's solicitors concerning the status of the Respondent and the authority of the person who made the determination of 1 December 2008.
  2. On 8 June 2010, the Respondent's solicitors lodged submissions in response to the questions asked of it. Those submissions and attached materials were forwarded to the Applicant's solicitor on 29 June 2010 with an invitation to respond or comment. The letter was properly addressed, prepaid and posted, and has not been returned. I am satisfied that the Applicant's solicitors received it. There has not been any response by the Applicant's solicitors.
  3. Having regard to the written submissions of the Respondent's solicitors received on 8 June 2010, I am satisfied:

(a) The Respondent, Linfox Australia Pty Ltd, is a licensed corporation as defined in s 4 of the SRC Act. In 2005 it was declared eligible to hold a licence pursuant Part VIII of the SRC Act (Safety, Rehabilitation and Compensation (Licence Eligibility) Notice 2005 (No 5) (F2006L00097)). The Respondent was granted a licence in 2006 and continues to hold a licence under Part VIII (Notice Nº 16 of 2007 published in the Commonwealth Gazette No S121 of 27 June 2007).

(b) The determination made on 1 December 2008 was signed by Heather Williams described at the conclusion of the determination as Delegate of the Rehabilitation Authority. Section 4 of the SRC Act provides that in the case of an employee employed by a licensed corporation, the rehabilitation authority is the principal officer of that corporation (Mr Michael Byrne). Section 41A of the SRC Act permits the principal officer in his capacity as a rehabilitation authority to delegate to an officer or an employee of a licensed corporation all or any of the powers and functions of the rehabilitation authority under this Part.

(c) The solicitors for the Respondent lodged a document completed by the Respondent recording the delegations made by Mr Byrne under the SRC Act. For the purposes of s 37, a delegation has been issued to the Director, General Counsel and the Group Manager - Workplace Safety, Operational Training and Compliance (Group Manager). The decision maker, Heather Williams, is the Group Manager as evidenced by another document lodged by the Respondent's solicitors.

(d) Ms Williams is also a determining authority, being the person who made the determination (refer s 60(1) of the SRC Act).

  1. Accordingly, I am satisfied that the decision made on 1 December 2008 was lawfully made within the relevant provisions of the SRC Act, by a person properly delegated.

SECTION 37(7) DETERMINATIONS

  1. A number of decisions have been made by the AAT and by the Federal Court concerning the operation of s 37(7) of the SRC Act. In Australian Postal Corporation v Forgie and Anor [2003] FCAFC 223; (2003) 130 FCR 279, the Full Court of Federal Court held that a determination made under s 37(7) is capable of review by the Tribunal provided review mechanisms have been exhausted.
  2. For the purposes of these reasons, I am satisfied that the decision in Forgie relevantly and comprehensively analyses the operation of s 37(7) and I adopt it for the purposes of this application.
  3. Section 61 of the SRC Act provides that when a determining authority makes a determination, it shall be completed in writing and be served on a claimant. The determination must set out the terms and reasons for the determination. The claimant must also be notified of the right to request a reconsideration if there is dissatisfaction.
  4. The Applicant was advised in writing of the determination made on 1 December 2008. A number of documents were enclosed, one being a copy of the return to work plan dated 20 October 2008 (p224-235). It gives notice of the risk of suspension of compensation entitlements (p224) and the right to request a review of the determination (p225). I am satisfied that this document constitutes a statement within the meaning of s 61(1)(c).
  5. Reconsideration of a determination exists by the operation of s 62 which compels a determining authority to make a reviewable decision in writing (s 63). The jurisdiction of the AAT is enlivened only by an application for review of a reviewable decision (s 64).
  6. A Determination, for the purposes of s 61, is defined in s 60(1) as a determination made under s 37. The definition refers to whole sections. I am satisfied that the determination made under s 37(7) is a determination as contemplated by s 61 and is a determination within the definition in s 60(1) (Forgie at [37]).
  7. The use of the expression self executing when describing s 37(7), in decisions previous to Forgie, is unfortunate and offends administrative review. Applications made under Part VI of the SRC Act can be reviewed by the AAT and there is no intention by s 37(7) to exclude decisions made under that section from review (Forgie at [65]). However, the opportunity for review given to applicants and the jurisdiction of the Tribunal to review decisions under the SRC Act, is confined to a review of reviewable decisions.
  8. The Applicant has not made an application for reconsideration of the determination made on 1 December 2008 as required under s 62. Consequently, a reviewable decision capable of enlivening the Tribunal's jurisdiction has not been made (s 63). The determination, therefore, remains operative.
  9. Section 37(7) provides that if an employee refuses or fails without reasonable excuse to undertake a rehabilitation program, his rights to compensation under the SRC Act and to institute or continue proceedings under the SRC Act are suspended until he begins to undertake the program. If a reconsideration had been sought, and subsequently affirmed by a reviewable decision, the Tribunal could, upon application, review the suspension decision and determine a) whether there was a refusal or a failure and if there was; b) whether it was without reasonable excuse. If the Applicant received a favourable outcome upon reconsideration, he would be permitted to continue with the two applications currently before the Tribunal.
  10. Presently, the Applicant cannot pursue the two substantive applications because of the operation of s 37(7). In the absence of a reviewable decision he has denied himself the opportunity to challenge the suspension and assert that he had a reasonable excuse for any refusal or failure to undertake a rehabilitation program.
  11. It was submitted by the Respondent that the Tribunal should not have accepted the two applications. However, the Respondent did not oppose them being lodged and it consented to an extension of time to lodge the second application
  12. In summary therefore, applicants who are subject to determinations made under s 37(7) of the SRC Act are entitled to seek reconsideration. A reviewable decision must be made to enliven the jurisdiction of the Tribunal under s 64 of the SRC Act.

STATUS OF SUBSTANTIVE APPLICATIONS

  1. The Respondent submitted that the applications should be dismissed. However, the Respondent did not refer the Tribunal to any provision which would permit such a course. In fairness there is no specific provision within the AAT Act where an applicant does nothing to avoid suspension of an application that has been lodged with the Tribunal. Neither party could point to any authority on this issue. I have been unable to locate any specific authority.
  2. The Tribunal’s power to dismiss an application is set out in s 42A and s 42B of the AAT Act. The Tribunal may dismiss an application if:
  3. It is not appropriate to dismiss the applications under ss 42A(1), (1A), (1B), (2) or (5)(b). The Applicant has not consented to a dismissal, nor has he indicated that he intends to discontinue or withdraw his applications. The Applicant has also appeared through his representative on all occasions when the applications were listed. He has not failed to comply with directions.
  4. I am satisfied that both applications presently cannot proceed because the Applicant's right to continue these proceedings remains suspended by s 37(7) of the SRC Act. However, it does not follow that applications that are suspended are not reviewable. The Applicant remains entitled to seek reconsideration of the determination of 1 December 2008. Whilst he would be well outside the statutory time limit for making such an application (refer s 62(3) of the SRC Act), there is provision for that time to be extended. Section 42A(4) does not apply because the decisions in applications Nº 2008/6162 and Nº 2009/2009 are reviewable decisions as defined (s 62 of the SRC Act).
  5. Section 42B of the AAT Act permits dismissal if applications are frivolous or vexatious. However, this power should only be exercised if a continuation of an application would not serve a legitimate purpose (Re Marnotta Pty Ltd and Secretary, Department of Health and Ageing [2004] AATA 326; (2004) 82 ALD 514). The Applicant has rights and interests in the current applications. His rights have not come to an end. If they had, the applications would be frivolous (Transurban Citylink Ltd v Allen [1999] FCA 1723; (1999) 168 ALR 687; Fearnley v Australian Fisheries Management Authority (2006) 94 ALD 519).
  6. Presently, both applications are suspended until the Applicant begins to undertake a rehabilitation program. Alternatively, he may argue he has had or continues to have a reasonable excuse for failing to undertake a rehabilitation program. But that can only be achieved if he applies for reconsideration of the determination of 1 December 2008 and then applies for review of the reviewable decision, if it is unfavourable to him.
  7. The present applications before the Tribunal are not frivolous. They are suspended. However, his rights have not come to an end and pursing those rights would be a legitimate purpose. Section 42B does not apply.
  8. Section 42A(5)(a) of the AAT Act empowers the Tribunal to dismiss an application without proceeding to review if an Applicant has failed within a reasonable time to proceed with the application.
  9. At all relevant times, the Applicant has been represented by lawyers. A determination was made on 1 December 2008. The jurisdiction of the Tribunal can only be enlivened by a reviewable decision made by the Respondent. Such a decision will only be made (in the absence of an own motion reconsideration) by an application to the Respondent by the Applicant or his solicitors. Such an application has not been made. More than 18 months have passed since the determination made under s 37(7) of the SRC Act was issued. The Applicant and, or, his solicitors have done nothing to challenge that decision. On 21 October 2009 the Applicant's solicitors conceded that the Applicant's rights to compensation and to institute and continue any proceedings were suspended. Nothing has been done subsequently to ensure that the Applicant's rights are pursued.
  10. The Applicant has a duty to take all reasonable steps to prosecute his applications. The Respondent is entitled to some certainty with respect to proceedings brought against it. The Tribunal is entitled to ensure that its case management objectives are satisfied.
  11. The application contemplated by s 42A(5)(a) are the applications currently before the Tribunal. Despite the applications currently being suspended, the Applicant can cause them to proceed – and therefore avoid the sanction imposed – by challenging the decision made on 1 December 2008. Continuing to do nothing will not avoid the risk of the current applications being dismissed. Allowing the current applications to be suspended may cause the Tribunal to be satisfied there has been a failure to proceed within a reasonable time, the consequence being dismissal without proceeding to review.

CONCLUSION

  1. I do not know whether the Applicant is personally aware of the gravity of his situation. More than a reasonable time has been given to him to proceed with his applications. I regret no explanation has ever been given why the Applicant has not sought reconsideration of the decision of 1 December 2008. The opportunity to do so remains open, although it may be the subject of an objection by the Respondent. The power to dismiss should be exercised very sparingly and is a decision of last resort (Guse v Comcare [1997] FCA 140; (1997) 49 ALD 288 at 291). It would be unfair to dismiss under s 42A(5)(a) without either an invitation to him to be heard and explain whether he will seek reconsideration or if not, whether he intends to make any submission in the absence of a reviewable decision as to why these applications should not be dismissed.
  2. Subject to any further Direction, if within four weeks the Tribunal is advised that a request for reconsideration has not been made, I will cause these applications to be listed for a dismissal hearing.
  3. I direct a copy of these reasons be forwarded to the Applicant personally, in addition to his solicitors.

I certify that the forty-eight [48] preceding paragraphs are a true copy of the reasons for the decision herein of

Mr John Handley, Senior Member


Signed: Olympia Sarrinikolaou

Legal Assistant


Date of Interlocutory Hearing 10 March 2010

Date of Interlocutory Decision 13 August 2010

Advocate for the Applicant Ms R. Driscoll, Victorian Compensation Lawyers

Solicitor for the Respondent Mr D. Clarke, Clarke Legal


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