PDL Industries Limited v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT HELD AT WELLINGTON Decision No. 143 /98 UNDER The Accident Rehabilitation and Compensation Insurance Act 1992 AND IN THE MATTER of an appeal pursuant to section 91 of the Act BETWEEN PDL INDUSTRIES LIMITED of Christchurch Appellant (Appeal No. DCA 112/97) AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent DECISION OF JUDGE A W MIDDLETON ON THE PAPERS The appellant has appealed against the decision of the Review Officer who was called upon to decide whether Mrs Thoms (the worker) had suffered a work injury which entitled the respondent to divide the costs associated with her claim between the appellant and Simpson Appliances Limited with whom she had also been an employee. The issue which has arisen arises out of the fact that at the time she filed an application for cover, the worker was then employed by Simpson Appliances Limited where she had been working for only some three months. Prior to that the worker had been employed by the appellant from 16 June 1995 to 7 June 1996. She commenced her employment with Simpson Appliances Limited on 11 June 1996 on a temporary three month contract. As a result of submissions received from both the appellant and the respondent, I issued a memorandum to the parties on 4 March 1998 indicating that the only issue 2 before the Court on this appeal is whether, for the purposes of the Act, the worker was the employee of the appellant when her claim was lodged. No steps have been taken by Simpson Appliances Limited to be a party to this appeal. The issue falls to be decided under section 7 of the Act which in so far as it relates to the appeal requires consideration of subsections (1) and (7) which respectively states: "(1) Personal injury shall be regarded as being caused by gradual process, disease, or infection arising out of and in the course of employment only if- a) In respect of a period that ended on or after the Ist day of April 1974, the employment task performed by the affected person, or the environment in which it was performed, had a particular property or characteristic which caused or contributed to that personal injury by gradual process, disease, or infection; and (6 ) The property or characteristic is not found to any material extent in the non-employment activities or environment of that person; and (c) The risk of suffering that personal injury is significantly greater for persons performing that employment task in that environment than for persons who do not perform that task in that environment." "(7) For the purposes of this Act, the employer of the person shall be the last employer whose employment exposed that person to the gradual process or the risk of the disease or infection; but where the person was employed by more than 1 employer in work involving that gradual process or that risk of disease or infection (as the case may be) the costs of the claim shall be divided between those employers in proportion to the periods of employment of the affected person with those employers." The appellant submits: That the worker's claim cannot constitute a work injury arising out of and in the course of her employment with it because she first received treatment for her condition on 8 August 1996, some two months after she ceased employment with the appellant: that pursuant to section 7(7) her employer, for the purposes of the Act, was the employer whose employment last exposed her to the gradual process and in this case it was Simpson Appliances Limited. The respondent submits: 1. That there are two possible ways in which section 7(7) can be applied, being: (a) that the second part of subsection 7 which follows the semi-colon, "disease or infection" stands alone and imposes an obligation on the respondent to apportion claim costs: that the first part of subsection 7 is effectively a deeming provision inserted for the purposes of administrative simplicity where by the words "the last employer" limits the obligation on the 3 respondent to obtain only one injury report from that last employer. That this has the result that it simplifies the process of obtaining work injury reports to only the "last employer"; and (b) Alternatively, that the second part of the clause following the semi-colon qualifies the earlier words whereby if there is more than one employer, to which the gradual process is attributed, all employers are then deemed to be the last employer. 2. That from an administrative position, the first interpretation is consistent with common-sense in that if an OOS claim is established and there has been, for example, ten employers, a review hearing would be complicated and each of them would be required to provide separate injury reports. 3. That the limiting words "for the purposes of this Act" would not have been necessary if the second approach is adopted. 4. That by using the words "last employer" there is implicit recognition that more than one employer may be implicated in the gradual process but that only one of those employers is regarded as the employer for the purpose of establishing a claim made by an employee. 5. That if the Act had contemplated more than one employer as the last employer it would have used the words similar to "the employer or employers of the person shall be the employer or employers". On that basis the original submission of the respondent is consistent with the plain and ordinary meaning of "the last employer" and gives effect to that phrase. 6. That if the Court accepts the first application of subsection 7, as submitted by the appellant, this raises the question whether the worker was exposed to a risk of gradual process injury in her employment with Simpson Appliances Limited. That the evidence of the specialist, Mr Lester supports a finding that she was exposed to that risk with her employment with Simpson Appliances Limited. 7. That the result of the respondent's submission is that for the purposes of section 7(7) Simpson Appliances Limited is regarded as the worker's employer for the purposes of the Act with the result that under section 65 the respondent is only required to obtain a work injury report from Simpson Appliances. It follows that only that company is entitled to review rights in relation to the respondent's decision on the question of whether or not the worker has suffered a work injury. 8. That these submissions are not inconsistent with the statutory mechanism whereby the respondent can apportion the costs of the claim between a number of employers. 4 The problem which I see with the appellant's submission is that in relation to section 7(7), the first part of the section is qualified by the word "but" which follows the semi-colon. I am of the view that that qualification is there in order to distinguish the situation which arises in this case where the worker has suffered an injury which clearly qualifies on the medical evidence as a work injury but where the medical evidence demonstrates that the employment which is likely to have caused the condition was the worker's employment with this appellant and not with Simpson Appliances Limited. If that is the situation then it seems to be against the principles of natural justice that this appellant is precluded from applying for a review of the decision in relation to whether or not the worker has suffered a work injury arising out of and in the course of her employment. I consider that the justice of the case requires that if a worker has been employed by more than one employer in work which could be the cause of the work related injury then each employer should be entitled to examine and make submissions on the available evidence. This position would seem to be supported by section 89(2) under which "any employer who is dissatisfied with a decision of the Corporation under section 65 or section 107 ... may apply to the Corporation for a review of that decision." That provision appears to me to conflict with the submission now made by the respondent that if a worker has been employed by more than one employer in work which may have contributed to the onset of a work injury which is accepted by the respondent as such under section 65, then by the very words of section 89(2) any employer can apply for a review. While both the appellant and the respondent argue that on the basis of section 7(7), Simpson Appliances Limited must be accepted as the appellant's last employer and therefore the decision of the Review Officer was wrong, I consider that the Review Officer approached the argument correctly and that the submission now made, particularly by the respondent, would defeat the provisions of section 89(2). It is interesting to note that section 89(4) again refers to "any person who is dissatisfied with the decision of the respondent relating to any premium payable may apply for a review of that decision." While the word "premium" is not defined in the Act it appears that this could cover the costs of a work claim which may or may not be apportioned between various employers. Again, however, it is the words "any person". The question of work injuries has raised various difficulties since it was incorporated into this Act with a view to attributing costs to employers. The Court has in the past raised questions as to the procedures which should be adopted in dealing with work injury claims because no procedure has been set out in the legislation and various difficulties have arisen in the past when interested parties have not been aware of the fact that they may be charged with costs arising out of claims of which they have no knowledge. While this is an issue which could perhaps be dealt with by legislation, I mention the matter because of the difficulties which have arisen which could be remedied by specific rules. While both parties to this appeal appear to have arguable cases, I do not consider that the legislation is as clear as the appellant would have the Court think. I consider that the interpretation applied by the Review Officer was correct and the appeal is 5 dismissed. However, in doing so, I consider that because of the complex nature of the legislation, leave is granted to either party to appeal to the High Court for an interpretation of section 7. DATED at WELLINGTON this 7 day of July 1998 A W Middleton District Court Judge dc112-97.doc (nr)