Comcare v Marinceski

• Jurisdiction: Australia Federal only
• Court: Federal Court
• Judgment Date: 28 December 2007
• Neutral Citation: [2007] FCA 2088

FEDERAL COURT OF AUSTRALIA

Comcare v Marinceski [2007] FCA 2088

COMCARE v JOHN MARINCESKI AND ADMINISTRATIVE APPEALS TRIBUNAL

NSD 644 OF 2007

FLICK J

28 DECEMBER 2007

SYDNEY

IN THE FEDERAL COURT OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY	NSD 644 OF 2007

BETWEEN:	COMCARE Applicant
AND:	JOHN MARINCESKI First Respondent ADMINISTRATIVE APPEALS TRIBUNAL Second Respondent

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL CONSTITUTED BY SENIOR MEMBER ALLEN

JUDGE:	FLICK J
DATE OF ORDER:	28 DECEMBER 2007
WHERE MADE:	SYDNEY

THE COURT ORDERS THAT:

1. The appeal be allowed.

2. The decision of the Administrative Appeals Tribunal dated 16 March 2007 be set aside and the matter be remitted to the Tribunal for further determination in accordance with these reasons.

3. The Amended Application for an order of review be dismissed.

4. The cross-appeal be dismissed.

5. Leave to amend the Notice of Cross-Appeal be refused.

6. The First Respondent to pay the costs of the Applicant.

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	NSD 644 OF 2007

ON APPEAL FROM THE ADMINISTRATIVE APPEALS TRIBUNAL CONSTITUTED BY SENIOR MEMBER ALLEN

BETWEEN:	COMCARE Applicant
AND:	JOHN MARINCESKI First Respondent ADMINISTRATIVE APPEALS TRIBUNAL Second Respondent

JUDGE:	FLICK J
DATE:	28 DECEMBER 2007
PLACE:	SYDNEY

REASONS FOR JUDGMENT

1 On 16 March 2007 the Administrative Appeals Tribunal published its reasons for decision in respect to a claim for compensation made by Mr John Marinceski.

2 The facts raised by the Notice of Appeal are not disputed. The principal issue in dispute is the application of s 52(3) of the Compensation (Commonwealth Government Employees) Act 1971 (Cth) and also s 52(4)(g) of that Act.

3 The facts may be stated simply. On 2 April 1979 Mr Marinceski was retired from his position as a gardener with the Department of the Capital Territory — Parks and Gardens, on the ground of invalidity. From 24 May 1979 Mr Marinceski has been receiving an invalid pension payable under s 24 of the Social Security Act 1947 (Cth).

4 Prior to May 1979, namely on 9 March 1979, Mr Marinceski made a claim for compensation payable pursuant to the 1971 Act.That Act has been repealed by s 139 of the Safety, Rehabilitation and Compensation Act 1988 (Cth). The 1988 Act came into force on 1 December 1988. Section 124(1), however, provides that it is the 1988 Act that applies in relation to an injury loss or damage suffered by an employee, whether before or after the commencement of the 1988 Act. Section 124(2) further provides that an employee who suffered an injury before the commencement of the 1988 Act is not entitled to compensation unless he or she was previously entitled to compensation under the 1971 Act.

5 On 19 February 1985 Mr Marinceski’s claim for compensation was ultimately accepted by the Commissioner for Employees Compensation.

6 A sum of $ 4,477.09, being the amount of tax payable on the lump sum payment, was deducted from the compensation paid to Mr Marinceski. The manner in which this sum was calculated was explained in a letter from the Department of Territories to the Commissioner of Taxation dated 11 July 1986. That letter was in evidence before the Tribunal and formed part of the statement provided pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 (Cth). That letter detailed what was described as “the gross amount” payable to Mr Marinceski for the period 1979 through to 1986, and the tax payable for the years there identified.

7 In determining the amount of compensation on appeal, the Administrative Appeals Tribunal concluded that s 52(3) conferred an “unfettered discretion” and empowered it to give consideration to the tax payable by reason of compensation having been paid. In resolving the dispute, the Tribunal decided in part as follows:

[26] I therefore set aside the decision under review and remit this matter to the Respondent with the direction that the calculation of underpayment to the Applicant is to be increased by the sum of $ 4,477.09, being the amount of tax extracted from his lump sum payment of compensation.

8 It is common ground between the Applicant and Mr Marinceski that the Tribunal erred in concluding that s 52(3) conferred an “unfettered discretion”. The Applicant contends that the taxation consequences of payments made is not within the ambit of the power conferred by s 52(3) and that that section confines consideration to the quantification of compensation payable; Mr Marinceski contends that s 52(3) does permit consideration to be given to the taxation consequences of a payment being made to a recipient of compensation.

9 A further matter dividing the parties is that Mr Marinceski wishes to contend on appeal to this Court that s 52(3) does not extend to any deduction being authorised for payments payable under the Social Security Act 1947 (Cth)or, alternatively, the payments in fact made in the present case. Mr Marinceski also contends that s 52(4)(g) “required the decision-maker to exclude payments in respect of dependent children”.

10 The Tribunal has filed a submitting appearance.

Section 52(3) — a deduction for invalid pension?

11 Section 52 of the Compensation (Australian Government Employees) Act 1971 (Cth) is a lengthy and somewhat complex provision. It is a section which provides for a reduction in the compensation payable.

12 Section 52(3) provides as follows:

Where, in relation to any period in respect of which compensation is payable to an employee in accordance with section 45, 46, 47 or 50, an amount is, or amounts are, paid or payable to the employee by the Commonwealth (not being an amount or amounts by way of salary, wages or pay) by reason of the injury in respect of which the compensation is payable or by reason of any incapacity resulting from that injury, the compensation payable to the employee under that section in respect of that period is, subject to subsection (4), such amount per week as is determined by the Commissioner, having regard to the circumstances giving rise to the payment of, or the liability of the Commonwealth to pay, that amount or those amounts, but the amount so determined shall not exceed the amount per week of the compensation that, but for this subsection, would be payable to the employee under that section in respect of that period.

13 The Applicant’s Notice of Appeal raised for resolution the correct construction and application of this provision. The Notice of Cross-Appeal as filed on behalf of Mr Marinceski raised for resolution the following three questions, namely:

(1) Did the Tribunal err in law in failing to take into account the effect of subsection 52(4)(g) of the Compensation (Australian Government Employees) Act 1971?

(2) Did the Tribunal err in finding that the tax paid on the lump sum payment was $4,477.09?

(3) Did the Tribunal err in applying the policy against “double dipping”?

14 By a document titled “Amended Notice of Cross-Appeal”, Mr Marinceski seeks to contend that s 52(3) does not extend to or embrace any deduction for payments made by way of invalid pension. He sought leave to amend. If leave is granted, he further seeks to contend that, even if s 52(3) does permit a deduction for such a pension, there should be no deduction in the present case because there was no evidence before the Tribunal that the invalid pension paid to him was payable by reason of the same injury for which compensation was paid. His Outline of Submissions concluded by contending that:

The tribunal had before it no evidence that the invalid pension paid to the respondent was paid in respect of “incapacity arising from an injury for which compensation was payable.” It is submitted that that tribunal erred in failing to take any account of whether the pension paid to the respondent was in respect of incapacity arising from an injury for which compensation is payable. It seems simply to assume that the compensation and pension were paid in respect of the same incapacity.

15 These contentions, it is considered, had not been raised by the existing Notice of Cross-Appeal. Leave to now pursue such factual contentions should not be entertained.

16 Subsequent to the hearing of the appeal, further submissions were filed by both the Applicant and Mr Marinceski directed to the questions whether leave should be given to amend the Notice of Cross-Appeal. In the further submissions filed on behalf of Mr Marinceski, it was foreshadowed that “it would be a matter of small moment” for this additional factual matter to be pursued before the Tribunal should the proceedings be remitted to the Tribunal for further consideration. Reliance was placed upon the following observations of Mansfield J in Murran Investments Pty Ltd v Aromatic Beauty Products Pty Ltd [2000] FCA 1732, 191 ALR 579:

[44] In Celestino v Celestino (unreported, Spender, Miles and von Doussa JJ, 16 August 1990) (Celestino), the court had to consider an application made during the course of an assessment of damages that a written admission of liability be withdrawn. The Full Court quoted with approval the principle stated by Bowen LJ in Cropper v Smith (1884) 26 Ch D 700 at 710–11:

… the object of Courts is to decide the rights of the parties, and not to punish them for mistakes they make in the conduct of their cases … I know of no kind of error or mistake which, if not fraudulent or intended to overreach, the Court ought not to correct, if it can be done without injustice to the other party … as soon as it...