May 2014

High Court decides the Goudappel appeal for workers compensation

The High Court today overturned the Court of Appeal decision in Goudappel.  In this bulletin, we discuss the decision and its ramifications.

Background

Mr Goudappel sustained injury prior to 19 June 2012.  A general claim for compensation was lodged by him on 19 April 2010.  A formal claim for lump sum compensation pursuant to section 66 was made on 20 June 2012 for 6% WPI.  The respondent disputed the worker’s claim as the WPI assessment was not greater than 10%, as required by section 66(1) of the Workers Compensation Act 1987, (“the 1987 Act”) as amended.

The dispute was upheld by the President of the Workers Compensation Commission, on the basis the claim for impairment compensation was made after 19 June 2012 and did not reach the 11% WPI threshold.  That decision was overturned by the Court of Appeal who, in a unanimous decision, found the 2012 lump sum amendments did not apply to claims for compensation which were made before 19 June 2012, even if the lump sum claim was made on or after that date.  Effectively, the Court of Appeal found impairment claims for injuries suffered prior to 19 June 2012 were not affected by the 2012 amendments, as long as some form of claim had been made previously.

The respondent appealed the decision to the High Court seeking to overturn the Court of Appeal decision.  Primarily, the High Court looked at the correct approach to the construction of provisions in the 1987 Act authorising the making of regulations that have a transitional operation and which themselves amend the operation of the 1987 Act. 

The High Court decision

The High Court found clause 5(4) of Pt 19H of Schedule 6 enabled the making of clause 11 of Schedule 8 of the regulations which ultimately resulted in claims for lump sum compensation not specifically made prior to 19 June 2012 being invalid, if they did not result in a finding of over 10% WPI.  The regulation was declared valid by the High Court, thereby extinguishing Mr Goudappel’s entitlement to impairment compensation.

What does this mean?

  • The 11% threshold affects any impairment claim made on or after 19 June 2012;
  • Claims for section 67 compensation not made prior to 19 June 2012 are now invalid.

Issues still to be determined or clarified

Despite the High Court decision, there are still some potentially unresolved issues, namely:

  • Whether the 2012 amendments apply to Table of Disabilities claims (injuries prior to 1 January 2002);
  • Whether further (top up) claims are prevented by reason of section 66(1A);
  • The status of impairment claims, in particular section 67 entitlements, currently under negotiation, but not agreed.

We expect WorkCover will shortly issue directives surrounding these issues.

In practice

Looking ahead, we anticipate workers’ lawyers will delay the making of impairment claims until such time as they have obtained evidence of at least 11% WPI.  This is likely to result in the making of claims which incorporate assessments for other, but related, impairments such as gastrointestinal impairment (through the ingestion of medicine) or altered gait (linked to back impairment). 

Today’s decision will have the immediate effect of reducing the number of small claims for impairment compensation.

 

Authors: Judith Edwards and Gary Forster