THE BOARD OF TRUSTEES OF MELVILLE HIGH SCHOOL v CRONIN-LAMPE [2022] NZCA 407 [29 August 2022]

THE BOARD OF TRUSTEES OF MELVILLE HIGH SCHOOL v CRONIN-LAMPE [2022] NZCA 407[29 August 2022]IN THE COURT OF APPEAL OF NEW ZEALANDI TE KŌTI PĪRA O AOTEAROACA689/2021[2022] NZCA 407BETWEEN THE BOARD OF TRUSTEES OFMELVILLE HIGH SCHOOLAppellantAND KATHLEEN CRONIN-LAMPEFirst RespondentRONALD CRONIN-LAMPESecond RespondentHearing: 16 March 2022Court: Kós P, Gilbert and Collins JJCounsel: P N White and A C Challis for AppellantT M Braun for RespondentsS M Bisley and E L Donnelly for Accident CompensationCorporation as IntervenerJudgment: 29 August 2022 at 9.30 amJUDGMENT OF THE COURTA The appeal is dismissed.B We answer the question of law on which leave to appeal was granted by thisCourt:Whether the Employment Court has jurisdiction to hear a proceeding inwhich a claimant has made claims under the Accident Compensation Act2001 but review and appeal rights under that Act have not beenexhausted?Yes, in the circumstances of this case.C The appellant must pay costs to the respondents for a standard appeal on aband A basis and usual disbursements.____________________________________________________________________REASONS OF THE COURT(Given by Gilbert J)[1] Two employees suffer post-traumatic stress disorder in the course of theiremployment. They make claims for cover under the Accident Compensation Act 2001(the Act). After pursuing these claims for over two years, including by way of review,they ultimately accept the correctness of the Accident Compensation Corporation's(the Corporation) decision. The Corporation determined that their work-relatedmental injuries were not caused by a single event within the terms of s 21B of the Actand, accordingly, the employees are not entitled to cover.[2] The employees now seek to pursue claims in the Employment Court allegingtheir employer breached its health and safety obligations. The employer argues thatthe Employment Court has no jurisdiction; the employees are "locked into" the Act'sprocedures and must first exhaust their rights of review and appeal under the Act.Even though the employees no longer dispute the Corporation's decision to declinecover, the employer claims they must press on and pursue further rights of review andappeal. The employer contends this course is mandated by s 133(5) of the Act:133 Effect of review or appeal on decisions(5) If a person has a claim under this Act, and has a right of review orappeal in relation to that claim, no court, Employment RelationsAuthority, Disputes Tribunal, or other body may consider or grantremedies in relation to that matter if it is covered by this Act, unlessthis Act otherwise provides.[3] The Employment Court rejected the employer's contention.1 The Court couldnot discern any "obvious reason as to why needless litigation within the ACC regime1 Cronin-Lampe v The Board of Trustees of Melville High School [2021] NZEmpC 201[Employment Court decision].would be intended" by Parliament.2 The employer was not persuaded and now appealsto this Court, with leave, on the following question of law:3Whether the Employment Court has jurisdiction to hear a proceeding in whicha claimant has made claims under the Accident Compensation Act 2001 butreview and appeal rights under that Act have not been exhausted?[4] We explain in this judgment why we agree with the Employment Court thatthe answer to this question is "yes" in the circumstances we have described.The facts[5] From 1996 to 2012, Mr and Mrs Cronin-Lampe were employed as guidancecounsellors by the Board of Trustees of Melville High School (the Board). They claimthe Board failed to meet its health and safety obligations and, as a consequence, theyboth suffered post-traumatic stress disorder from dealing with multiple studentsuicides.[6] In July 2013, Mr and Mrs Cronin-Lampe commenced proceedings againstthe Board in the Employment Court challenging a determination by theEmployment Relations Authority. Three related challenges were commenced in theEmployment Court later in 2013 and in 2014. Concurrent proceedings were alsocommenced in the High Court due to jurisdictional limitations of theEmployment Court under the Employment Relations Act 2000. These proceedingshave been stayed pending the outcome of the Employment Court proceedings.[7] In August 2017, the parties consented to directions adjourning theEmployment Court proceedings "to allow the ACC process to be resolved" —a reference to the ACC claims Mr and Mrs Cronin-Lampe had commenced inthe meantime, in December 2016.[8] The Corporation declined Mr and Mrs Cronin-Lampe's claims for cover inSeptember 2017. Mr and Mrs Cronin-Lampe were dissatisfied with this outcome andapplied for review in December 2017. Following a hearing in June 2018, at which2 At [51].3 Board of Trustees of Melville High School v Cronin-Lampe [2021] NZCA 686 at [4].the Board was represented, the review was allowed. The decision declining cover wasset aside and the Corporation was directed to reconsider the applications for cover inaccordance with the reviewer's directions.[9] In December 2018, the Corporation again declined cover. Mr andMrs Cronin-Lampe each made a second application for review, in April 2019.The reviews were scheduled to be heard in February 2020. However, followingconsultation with their legal counsel, Mr and Mrs Cronin-Lampe ultimately agreedwith the Corporation that they were not eligible for cover because their mental statewas not linked to a single event as required under s 21B of the Act. They thereforediscontinued their applications for review before the hearing in February 2020.[10] The parties turned their attention to the Employment Court proceedings.Interlocutory steps were completed, and the pleadings were finalised. The Boardpleaded numerous affirmative defences, including that the claims were for damagesarising directly or indirectly through personal injury covered by the Act and thereforebarred by s 317 of the Act. By August 2021, it was agreed by all parties, including theCorporation which had been given permission to intervene, that there should be apreliminary determination of the jurisdictional question arising under s 133(5) ofthe Act. It is from the determination of this question that the present appeal is brought.Employment Court decision[11] Judge Corkill considered that Parliament's purpose was for the Corporation tobe the primary decision-maker as to cover and entitlements under the Act, with anydisputes to be dealt with under the statutory processes of review and appeal.The intention was to provide an efficient and specialist regime for resolution ofACC claims.4 However, the Judge did not consider that claimants were required topursue all review and appeal rights "ad infinitum".5 He could not see why "needlesslitigation within the ACC regime" could have been intended.6 This would be"inherently unlikely, illogical and contrary to the interests of justice".7 It could require4 Employment Court decision, above n 1, at [50].5 At [51].6 At [51].7 At [51].the parties to incur time and expense dealing with pro forma reviews and appeals.8The Judge therefore concluded that s 133(5) had no application in the presentcircumstances.9Submissions[12] Mr White, for the Board, submits that the present case is indistinguishable fromthat considered by the Supreme Court in Austin v Roche (New Zealand) Ltd.10Mr Austin's claim for cover under the Act was accepted by the Corporation but hesubsequently changed his position and commenced proceedings againstthe respondent in the High Court.11 The Supreme Court held that the "effect ofs 133(5) is that once a person lodges a claim, they are locked into the Act'sprocedures".12 The Supreme Court found that unless Mr Austin brought a reviewapplication out of time within one month, his proceeding would be struck out.13[13] In reliance on this decision, Mr White submits that the making of a claim forACC cover triggers the operation of s 133(5). Once triggered, the claimant is"required to pursue that process to the end before pursuing a claim outside of the Act'sprocess[es] for the same matters" — meaning the claimant is required to "exhaust"the Act's processes irrespective of whether they dispute the Corporation's decisionon cover. He says it is clear from the Supreme Court's decision that it does not matterwhether a review or appeal has been initiated. The statutory bar continues to haveeffect for so long as any right of review or appeal remains.[14] Mr White submits that the Employment Court erred in suggesting thatthe interpretation he contends for would mean that reviews and appeals would have tobe pursued "ad infinitum". He says s 133(5) contemplates only an application forreview or an appeal to the District Court. Other possibilities, such as an appeal to thisCourt on a question of law, require leave and do not constitute "a right of review orappeal" in terms of s 133(5).8 At [51].9 At [60].10 Austin v Roche Products (New Zealand) Ltd [2021] NZSC 30, [2021] 1 NZLR 294.11 At [3]–[4].12 At [20].13 At [36]–[37].[15] Mr White points out that in a case such as the present where the Corporationand the claimant agree there is no cover, the employer has no right to challengethe decision through the Act's processes by initiating a review or an appeal. For thisreason also, he submits that his interpretation is consistent with Parliament's intentionthat the investigative regime under the Act should be utilised to resolve questions ofcover once the process has been triggered by the claimant making a claim for cover.[16] Mr Braun, for Mr and Mrs Cronin-Lampe, submits that Austin is clearlydistinguishable. Mr Austin was granted cover by the Corporation but then broughtproceedings in the High Court on the basis he was not covered. Here, the claims forcover were declined, twice. Mr Braun supports the Employment Court's analysis andconclusion.[17] Mr Bisley, for the Corporation, also supports the Employment Court decision.He submits that the primary purpose of s 133(5) is to channel disputes as to cover orentitlement between the Corporation and a claimant into the procedures set out in pt 5of the Act. Thereafter, their disputes can be quickly and efficiently resolved byspecialist tribunals. He argues that s 133(5) was not intended to create a proceduralhurdle for intending plaintiffs by requiring them to exercise and exhaust the disputeresolution processes provided in pt 5 when they accept the Corporation's decision.However, he says the provision was not intended to displace the fundamentalpresumption that a person's rights can only be determined in a proceeding to whichthey are a party. Because the Board was not party to the pt 5 process, it is not boundby it and is free to argue in the Employment Court that Mr and Mrs Cronin-Lampe'sclaims are barred by s 317 of the Act.Assessment[18] Section 133(5) is a privative provision that requires challenges to decisionsmade under the Act concerning rights to cover to be brought under the disputeresolution procedures in pt 5. The provision applies where "a person has a claim underthis Act, and has a right of review or appeal in relation to that claim".14 A "claim" isdefined as a claim under s 48 of the Act:1548 Person to lodge claim for cover and entitlementA person who wishes to claim under this Act must lodge a claim withthe Corporation for—(a) cover for his or her personal injury; or(b) cover, and a specified entitlement, for his or her personalinjury; or(c) a specified entitlement for his or her personal injury, oncethe Corporation has accepted the person has cover forthe personal injury.[19] Part 5 of the Act sets out the dispute resolution procedures. Section 133 sitswithin this part of the Act. A claimant may apply to the Corporation for a review ofany of its decisions on the claim.16 An employer may apply to the Corporation fora review, but only if the decision is that the claimant's injury is a work-related personalinjury suffered during employment with that employer.17 The application must statethe grounds on which it is made.18 The claimant's employer is entitled to be presentat the hearing of a review if it relates to a decision as to cover for a work-relatedpersonal injury.19 The reviewer must provide a reasoned decision.20[20] A claimant may appeal to the District Court against a review decision.21The Corporation may also appeal to the District Court against a review decision.22The employer may only appeal to the District Court against a review decision that aninjury is a work-related injury.23 Any person who had a right to be present and heardat the hearing of the review is entitled to appear and be heard at the hearing ofthe appeal.2414 Accident Compensation Act 2001, s 133(5).15 Section 6.16 Section 134(1)(a).17 Section 134(2).18 Section 135(2)(d).19 Section 142(d)(ii).20 Section 144(2)(b).21 Section 149(1)(a).22 Section 149(2)(a).23 Section 149(4).24 Section 155(1)(b).[21] In summary, the claimant and the Corporation have rights of review and appealagainst decisions as to cover under the Act. The employer also has rights of reviewand appeal, but only in respect of a decision that an injury is a work-related personalinjury.[22] In the present case, the dispute between the claimants, Mr and MrsCronin-Lampe, and the Corporation as to cover was determined utilising the disputeresolution procedures in pt 5. No further process is contemplated. In particular, thereis no provision for the employer to apply for review or appeal to challengethe Corporation's decision that Mr and Mrs Cronin-Lampe are not entitled to coverunder the Act, a position they no longer dispute.[23] In our view, the privative effect of s 133(5) was spent whenMr and Mrs Cronin-Lampe agreed with the Corporation in early 2020 that they haveno right to cover under the Act. The dispute resolution process had run its course andthe dispute had been resolved.[24] We agree with Judge Corkill that it cannot have been Parliament's intentionthat a claimant who accepts the Corporation's decision that he or she is not entitled tocover, would nevertheless be required to "challenge" that decision, by way of reviewor appeal, before being able to pursue remedies in the Employment Court or elsewhere.We cannot see any useful purpose being served by requiring claimants to challenge byway of review or appeal decisions of the Corporation they agree with. It is unclearwhat grounds they would advance in their application for review or appeal and whatpoint would be served by the hearing or the requirement for a reasoned decision.Parliament cannot have intended such a farce. The Board's argument overlooksthe fundamental point that review and appeal rights are conferred for the benefit ofparties seeking to disturb the challenged determination. A claimant cannot be expectedto seek review or appeal against a decision he or she does not challenge, even assumingthere was a right to do so.25 Such a review or appeal would likely be regarded asfrivolous and an abuse of process. It would be directly contrary to Parliament'sintention for disputes about cover to be resolved speedily and efficiently.25 Dean v Chief Executive of the Accident Compensation Corporation [2007] NZCA 462, [2008]NZAR 318 at [24]–[25].[25] We see Austin as being distinguishable. The Corporation accepted his claimfor cover, but he later disputed the correctness of that decision. He therefore had toutilise the pt 5 processes to resolve that dispute. As Mr Bisley says, Mr Austin was inprecisely the opposite position to Mr and Mrs Cronin-Lampe.Result[26] The appeal is dismissed.[27] We answer the question of law on which leave to appeal was granted by thisCourt:Whether the Employment Court has jurisdiction to hear a proceeding in whicha claimant has made claims under the Accident Compensation Act 2001 butreview and appeal rights under that Act have not been exhausted?Yes, in the circumstances of this case.[28] The appellant must pay costs to the respondents for a standard appeal on aband A basis and usual disbursements.Solicitors:McElroys, Auckland for AppellantBraun Bond & Lomas, Hamilton for RespondentsBuddle Findlay, Wellington for Intervener