Estate of Inoke v Accident Compensation Corporation

IN THE DISTRICT COURT AT AUCKLAND [2015] NZACC 20 ACR 369/13 UNDER THE ACCIDENT COMPENSATION ACT 200 IN THE MATTER OF AN APPEAL UNDER SECTION 151 OF THE ACT BETWEEN ESTATE OF MAKAMAPUHIA INOKE Appellant AND ACCIDENT COMPENSATION CORPORATION Respondent Hearing: 28 January 2015 Appearances: Mrs Molini Inoke (in person for the appellant) Mr D Tui for respondent Judgment: 30 January 2015 RESERVED JUDGMENT OF JUDGE A N MACLEAN [1] At issue in this appeal is a decision by the Accident Compensation Corporation ("the Corporation") dated 13 March 2013 declining an application for weekly compensation, and an appeal from a reviewer dated 26 June 2013 upholding the Corporations decision. [2] The appeal raises a quite narrow point which is best understood by a brief narration of the background facts which are largely not in dispute. [a] The late Mr Inoke worked for Gibbons Contractors from 30 August 2010. [b] He was a valued employee but when it emerged that he was ineligible to work in New Zealand, New Zealand Immigration Service contacted his employer and as a result Mr Inoke's employer gave notice to Mr Inoke stopping his employment as at 9 October 2011. [c] Sadly on 24 October 2011 whilst net fishing with two friends he was dragged out to sea by a rip and drowned. [d] The Corporation considered and paid entitlements arising out of his death including a survivor's grant, funeral grant and child care payments. [e] However when the Corporation considered an application for weekly compensation for his spouse and children and upon learning from the company that as far as they were concerned he had ceased to be a paid employee as at 9 October 2011 determined the estate was not entitled to weekly compensation. [3] The corporation accepts that Mr Inoke was nevertheless in a form of employment relationship or contract after 9 October 201 1. [4] Relevant here is part of the evidence before the reviewer which summarises the situation and is recorded in file notes dated 18 and 31 May 2012 on the Corporation file. [5] Firstly "received a phone call from Ron Williams he said that Mala [Mr Inoke] was employed by them at the date of death but due to immigration issues [an illegal immigrant in New Zealand] he had only actually worked for a short time. They were told that if they continue to employ Mr Inoke they would be charged, they had not cancelled his employment contract at all and if the immigration matter was resolved and he was allowed to work in New Zealand to again they would continue to employee him". [6] And later in the second note "according to information obtained from IRD Mr Inoke had been employed from September 2010 until October 2011... he stopped. working for his employer, Gibbons Contractors on 9 October 2011 and was paid final holiday pay equivalent to three days pay at this time... from the employer's point of view the client was still an employee and had he not have had his employment terminated if Mr Inoke had been able to remain and work legally in New Zealand the employer advised that Mr Inoke would have continued working as an employee." [7] The reviewer considered some evidence from Mrs Molini Inoke because she took issue with the fact that there were no further payments after 9 October coming from the employer and she pointed to a diary in her husband's handwriting appearing to show that he had returned to work from 16 October. 8] This was explored thoroughly and Mrs Inoke was unable to advance the matter any further, such as by way of demonstrating money being paid into a bank account or any other form of evidence that might confirm the proposition outlined in the diary. There was no pay slip or any other confirmation of that payment and as noted earlier that contradicted the evidence from the employer. [9] At the appeal before me Mrs Inoke was unable to add anything further in respect of that matter other than to re-confirm that she believed that the entries in the diary did confirm that he had gone back to work. [10] I can only conclude on consideration of all the information made available to me that there is simply is no probative evidence of any continuation of paid employment after 9 October. [11] The reviewer considered and the issue was addressed at the appeal as to what, if any, effect the evidence that the employer had arranged for Mr Inoke to attend a work safety course in November might have. There is no evidence that that amounts to any form of payment, although the assumption would be, but it is speculation, that some sort of fee would have been paid by the employer to the Course organisers, if Mr Inoke had survived and attended and it was clearly a work related aspect because as Mrs Inoke explained at the appeal, his safety certificate had expired earlier in the year, and it would be a necessary requisite (similar perhaps to a heavy trade driving licence or the like, for other types of employment) for him to remain in employment. [12] I agree with the respondent that it, of itself, does not change anything. [13] So the situation is reached whereby on the evidence the late Mr Inoke had ceased to be in paid employment as at 9 October and while his employer was quite prepared to have him back when and if his immigration status was clarified that sadly was never able to be resolved. [14] The key relevant section for determination of weekly compensation entitlement to a spouse and dependants arises under clauses 66 and 71 of schedulel to the Act namely, "weekly compensation... to which the claimant would have been entitled... had he or she lived but been totally incapacitated". [15] Pursuant to s 103 and clause 32 of Schedule 1 an avenue to be considered is whether Mr Inoke was engaged in employment immediately before his death. "Employment" is defined under s 6 as a) means work engaged in or carried out for the purposes of pecuniary gain or profit and; b) in the case of employee includes a period of paid leave other than paid leave on the termination of employment. [16] Counsel for the respondent drew my attention to the High Court decision of Ryan v ACC CIV 2005-404-5967 (Auckland Registry, Simon France J 15 May 2006) where the applicant was on unpaid leave from bank employment where the Court stated at paragraph 33 "a person on unpaid leave in the circumstances... does not fall within clause 32 of schedule I of the Act". The Court went on to explain that "an entitlement to return to work is not the same thing as an entitlement to receive income. An entitlement to receive income comes from actually doing work and unless one works there is no entitlement to receive income". [17] The situation is analogous to the position in this case. Mr Inoke could be described as having been under some form of unpaid leave but with an indeterminate and a provisional expectation or entitlement of ability to return to work which was dependant on the successful outcome of an appeal to the Minister of Immigration. [18] Accordingly I agree with the submissions of the Corporation that by analogy with the Ryan case and on the evidence as outlined earlier Mr Inoke was not engaged in paid employment as at the date of his death. [19] The next question is whether under clause 43(2)(b) of the schedule, there might be a deemed extension of Mr Inoke's employment through to the date of death. [20] I accept the Corporation's argument that this extension is not open. [21] Mr Inoke's holiday pay only extended 3 days to 12 October and the deemed 28 day extension under clause 43(2)(a) does not apply. [22] For completeness that clause states that "the claimant is deemed to continue to be in employment and have earnings from that employment for the purposes of the schedule..." (a) 28 days from the date he or she ceased to be in employment if he or she had been in employment within 28 days before his or her incapacity commenced and (ii) would have been an employee within the period specified under sub-clause 3 after the date in which his or her capacity commenced but for the incapacity." That period is three months. [23] There is no argument that Mr Inoke met the requirement in clause (2)(a)(i) but the issue is whether he met the criteria under the second sub-section. [24] The key word is "would" have been an employee. [25] The evidence is quite clear that while the employer was holding his job open, the provisional return to work was completely dependent on New Zealand Immigration. [26] I further accept that there is little evidence regarding the likelihood of that application , which had been made, receiving a favourable outcome within the three month time period, [27] Indeed I accept that the thrust of the information from the Ministers office clearly indicates in the context of the general election around the relevant time there was no likely prospect of a successful determination within the three month time frame. Indeed there is evidence that the determination was still unresolved well after the lapse of the three month period. [28] Put in onus of proof terms I agree that there is insufficient evidence that Mr Inoke was more likely than not to have had his work status favourably resolved and be back in paid employment with Gibbons Contractors by 24 January 2012. [29] That effectively determines the appeal but for completeness I note that the respondent accepts that the reference by the reviewer to considerations under $ 127(2) was somewhat of a red hearing and had no relevance in the context of the actual factual situation because it deals with the situation of payment outside of New Zealand and that is not the case here. [30] For the foregoing reasons, therefore the appeal is dismissed. .... .. .. Costs [31] It seems to me that this is a case where it was reasonable for the appellant to have wanted to test the issue. Sadly, although one has to have every sympathy at the circumstances in which Mr Inoke's family found themselves after his untimely death, the law is against them. [32] In my view therefore there should be no costs order. Judge A N Maclean District Court Judge