AAT King's Tours Pty Ltd v Robert Albert Halliday Hughes [NTLR]

• Jurisdiction: Northern Territory
• Court: Supreme Court
• Judge: Gallop A/CJ,Kearney,Morling JJ
• Judgment Date: 21 October 1994
• Docket Number: No. AP6 of 1994
• Date: 21 October 1994

(1994) 4 NTLR 185

(1994) 99 NTR 33

IN THE COURT OF APPEAL OF THE NORTHERN TERRITORY OF AUSTRALIA

Gallop A/CJ, Kearney and Morling JJ

No. AP6 of 1994

AAT King's Tours Pty Ltd

and

Robert Albert Halliday Hughes

Counsel for appellant: T. J. Riley QC

Counsel for respondent: S. M. Gearin

Morrisey v Conaust Ltd (1991) 1 NTLR 183, applied. Horne v Sedco Forex (1992) 106 FLR 373, referred to. J and H Timbers Pty Limited v Nelson (1972) 126 CLR 625, applied. Phillips v The Commonwealth (1964) 110 CLR 347, referred to. Barbaro v Leighton Contractors Pty Limited (1980) 44 FLR 204, followed

Francese v. Corporation of the City of Adelaide (1989) 51 SASR 522, followed.

Work Health Act (NT), ss3, 53, 65(1)(2) and (6), 68 and 69(3).

Work Health Act (NT), s49(1).

Workers' compensation — cancellation by employer of compensation payments for total incapacity on ground that worker capable of earning at least ‘normal weekly earnings’ — whether ground relied on necessarily involved a factual issue as to worker's ‘loss of earning capacity’ — whether onus on employer to establish this factual issue — requirements for discharge of onus — whether employer bears onus of proving a change in worker's circumstances.

Workers' compensation — assessment of amount of compensation in terms of ‘normal weekly number of hours of work’ — worker required to work a pre-determined number of overtime hours each roster — meaning of requirement that to be included in ‘normal weekly number of hours of work’ overtime hours be ‘fixed’, and ‘worked in accordance with a regular and established pattern’ — whether such overtime has to be worked ‘in each week’.

ORDER

Appeal dismissed.

JUDGE1

1 Gallop A/CJ, Kearney AND Morling JJThis is an appeal from a decision of Angel J allowing an appeal by the present respondent from a decision of Mr Hannan SM sitting as the Work Health Court. The appeal before Angel J was brought pursuant to s.116 of the Work Health Act (‘the Act’), which confers a right of appeal on a question of law to the Supreme Court.

2 The facts giving rise to the application before the Work Health Court and the appeal to the Supreme Court are not in dispute. For ease of reference, we shall refer to the present appellant as the employer and the respondent as the worker.

3 The worker was a bus driver, commonly called a coach captain, who drove coaches for his employer. He was based in Alice Springs. On 31 July 1992, whilst on a bus tour in North Queensland, he sustained a penetrating injury to the left eye which caused 95 percent impairment of vision in that eye. He was paid compensation by the employer until 23 April 1993. The employer cancelled payments thereafter in purported pursuance of s.69 of the Act, which confers a right to cancel payments of compensation in certain circumstances. Section 69(1)(b) requires that the employer state its reasons. Importantly, the reasons stated for the cancellation and relied on by the employer before the Work Health Court were:-

‘That the amount you are reasonably capable of earning is equal to or greater than the amount of your normal weekly earnings as defined under the Work Health Act.’

4 It can be seen that the employer's case was not simply that the worker was no longer totally incapacitated; it was that he was no longer incapacitated at all. The worker appealed to the Work Health Court against that cancellation, under s111(1) of the Act.

5 On 25 October 1993 the worker commenced work as a police aide with the Northern Territory Police Force at a salary of $479.87 per week.

6 The two principal questions for the Work Health Court were, first, whether the employer justifiably cancelled compensation payments and, second, whether and to what extent the worker's earnings of overtime with the employer ought to have been taken into account in calculating his pre-injury normal weekly earnings. The Work Health Court held that the employer was justified in cancelling compensation payments as from 23 April 1993 and that no regard was to be had to overtime worked by the worker, in the calculation.

7 The issues raised on appeal before Angel J are not easy to discern as the reasons given by the Work Health Court are far from clear. The first issue before Angel J appears to have been whether the Work Health Court erred in law in finding that the employer had established justification for cancellation of compensation payments on 23 April 1993. His Honour held that in making this finding the Work Health Court had applied a wrong onus of proof. It had, in his opinion, failed to apply an onus which rested, in law, on the employer to establish that at the time of the cancellation of payments, namely 23 April 1993, there had been a change of circumstances such as to show that the worker was no longer incapacitated for work.

8 The second issue before Angel J was whether the Work Health Court erred in law in finding that no regard was to be had to overtime worked by the worker in calculating his pre-injury normal weekly earnings. Angel J held that the Work Health Court had wrongly interpreted the meaning of the expression ‘normal weekly number of hours of work’ as used in s.49 of the Act, in making its finding.

9 The question for this Court is whether Angel J's decision was correct.

10 We were informed by senior counsel for the employer, Mr Riley QC, that there is a substantial amount of litigation in the Work Health Court in respect of claims under the Act and that Angel J's decision has given rise to difficulties of construction of the relevant provisions of the Act. Accordingly, guidance is sought from this Court as to the correct construction of the relevant provisions.

11 On the first issue Mr Riley submitted that his Honour erred in holding that there was an onus on the employer to establish that work was available for the worker, the date upon which it became available and the rate of pay for that work. It was further submitted that the only onus resting upon the employer was to establish a change of circumstances that warranted cessation or variation of compensation payments and thereby to establish that the worker had a capacity to earn some amount, although less than his normal weekly earnings. Once the employer had satisfied that onus, if the worker wished to establish partial incapacity he bore the onus of showing the level of his partial incapacity and its money value.

12 It was argued, in effect, that his Honour had held that the onus of establishing that work was available, the date upon which it became available and the rate of pay applicable to the work rested upon the employer as part of the onus to demonstrate that the decision to cease payments was warranted; and that that was an error of law.

13 His Honour said in the course of his reasons that in order to justify cancellation the employer carried an onus of establishing a change of circumstances warranting cancellation. In particular, the onus was on the employer to demonstrate that the worker had ceased to be incapacitated for work; that is, by virtue of the definition of ‘incapacity’ in s.3, that the worker had an ability to undertake paid work. His Honour cited Horne v Sedco Forex (1992) 106 FLR 373 at 376. That was a decision of Mildren J following the decision of this Court in Morrisey v Conaust Ltd (1991) 1 NTLR 183.

14 His Honour then referred to part of the reasons for judgment of the Work Health Court, and in particular the following passage:

‘Between October and March selection of a date would be arbitrary and so I'm satisfied that the time that should be chosen is the earlier date, 25 March “93, and I so choose. I'm satisfied then that the employer's decision to terminate payments was correct, that the payments date of termination is the correct date and that there is no loss of earning capacity.’

15 No criticism is made of that passage in his Honour's reasons where he cast the onus of establishing a change of circumstances warranting cancellation on the employer and, in particular, of demonstrating in terms of the definition of ‘incapacity’ (s.3 of the Act) that the worker had an ability to undertake paid work.

16 However, his Honour then went on to say:

‘The appropriate legal test to determine whether the worker is incapacitated for work depends on whether there is loss of earning capacity within the meaning of s.65(2) of the Work Health Act which provides:

“(2) For the purposes of this section, loss of earning capacity in relation to a worker is the difference between -

(a) his normal weekly earnings indexed in accordance with subsection (3); and

(b) the amount, if any, he is from time to time reasonably capable of earning in a week during normal working hours in work he is capable of undertaking if he were to engage in the most profitable employment, if any, reasonably available to him.”

This necessarily requires an assessment of the most profitable employment available to the worker under s.68 of the Work Health Act. It is for the Court to consider both the potential availability for employment and whether such employment is reasonably available to the worker.

The learned Magistrate found that employment was not readily available to the appellant, despite his strenuous and diligent efforts to gain employment. There was no evidence before the learned Magistrate that the appellant could obtain gainful employment prior to taking up his job with the Police Force on 25 October 1993. In March 1993, the appellant went overseas to visit relatives. There is evidence that the appellant had applied to the Police Force for a position before his departure. He obtained employment with the Force upon his return to Australia. In the words of the learned Magistrate: “In March 1993, he went overseas for family reasons. At that time, he had made application for a position as an NT Police Auxiliary as a watch house court guard. In September 1993, an offer of...