Reihana v Accident Rehabilitation and Compensation Insurance Corporation

IN THE DISTRICT COURT Decision No. 126 196 HELD AT CHRISTCHURCH IN THE MATTER of The Accident Rehabilitation and Compensation Insurance Act 1992 AND IN THE MATTER of an Appeal pursuant to Section 91 of the Act BETWEEN TONI COLIN REIHANA Appellant (Appeal No. DCA 5/96) AND ACCIDENT REHABILITATION AND COMPENSATION INSURANCE CORPORATION a body corporate duly constituted under the provisions of the said Act Respondent HEARD on the 9th day of October 1996 APPEARANCES Appellant in person M L Mckenzie for respondent DECISION OF JUDGE D A ONGLEY This appeal concerned an assessment of relevant earnings as an employee for the purpose of earnings related compensation payments. The appellant was incapacitated by an accident that occurred on 30th August 1993. During the preceding 12 months he had earned a total of $11,644.89 so that his average earnings over 52 weeks were $223.94. His average weekly earnings immediately before the accident were a good deal higher. The Corporation assessed weekly earnings under s 40(2)(b) as one over 52 of the appellant's earnings as an employee during the 52 weeks immediately before the commencement of the incapacity. - 2- The appellant's argument is that the principle in s 39 of the Act should prevail, and should not be limited by the weekly earnings definition in s 40. The argument has been presented by the appellant with persistence and ingenuity but it cannot prevail. Section 39 states: 39. Compensation for loss of earnings payable to earners for incapacity generally - (1) The weekly compensation for loss of earnings payable to an earner who is incapacitated as a result of personal injury in respect of any period to which section 38 of this Act does not apply is 80 percent of the earner's weekly earnings. (2) The compensation for loss of earnings payable under this section shall be paid by the Corporation except to the extent that it is payable by an exempt employer under section 106 of this Act Under s 3 of the Act: "Weekly earnings" means, in relation to any earner, the weekly earnings of that earner determined in accordance with ss 40-43 of this Act Section 40, which was enacted in its present form before the date of the accident, divides the definition of weekly earnings into two stages, first the average over 4 weeks prior to the accident which applies for 4 weeks following the accident, and secondly, the calculation based on 52 weeks prior to the accident which governs the position after the first 4 weeks following the accident. There is no ambiguity. There are certainly cases of unfairness and that has been recognised by the High Court in a recent appeal decision of Tarr in which case Doogue and Heron JJ, dealing with s 41 of the Act, held that the wording is sufficiently clear to avoid ambiguity and the unfairnesses which result cannot be ameliorated by the Courts but must await the attention of Parliament. It is unnecessary to compare the two sections, but if there was any argument about ambiguity of s 40, then it could not be advanced in the face of the Tarr decision. In view of the care that the appellant has taken in preparing his argument, each of the points should receive attention. They are as follows: 1. It was submitted that s 39 evinces an overriding intention which should be given effect in a similar way to s 9 of the State-Owned Enterprises Act 1986 considered in New Zealand Maori Council v Attorney-General [1987] 1 NZLR 641. The first reason why the argument has to be rejected is that s 39 itself uses the expression "weekly earnings" which is not an expression with a natural and ordinary meaning independent of the Act. On its own, it is not related to a particular period of time and there is no particular reason why the appellant's argument that it must relate to the period immediately before the injury should be conclusive. The expression is clearly defined in the Act and ss 40-43 are exhaustive. Section 9 of the State-Owned Enterprises Act was a totally different kind of section. It stated: - 3- "9. Treaty of Waitangi - nothing of this Act shall permit the Crown to act in a manner that is inconsistent with the principles of the Treaty of Waitangi." . . It was manifestly an overriding principle and it is not possible to draw any parallel with s 39 of the ARCI Act. 2. The appellant submitted that the Act should be interpreted with reference to the Hansard Report of Parliamentary Debates on the Accident Compensation Bill 1972 and 1992. Copies of extracts from the Parliamentary Debates were submitted and the appellant referred to Marac Life Assurance Limited v Commissioner of Inland Revenue [1986] 1 NZLR 694. References to Hansard in modern statutory interpretation may be helpful to the Court in particular cases. In this case, the references are not helpful in interpreting what is a clearly expressed scheme embodied in the Act. At a political level, the Accident Compensation Act may not have been able to meet, over time, the expectations with which they were originally enacted. Those are matters of policy and economics which are outside the scope of the jurisdiction of the Court. It is that contradiction of expectation and legislative reality that the appellant is really pointing to. The issues which he raises are not helpful in deciding the question of interpretation that is involved in this appeal. 3. The appellant advanced a collateral argument relating to the policy and philosophy of the Act. Again, such an argument cannot prevail against clear legislative enactment. If an ambiguity of drafting was to be resolved then the policy and philosophy that could be derived from the overall scheme of the Act might be given weight in resolving the ambiguity. That is not the case here. 4. The appellant referred to s 14 and submitted that common law principles relating to damages for negligence should still be given effect, even though a common law cause of action for damages for personal injury caused by negligence cannot be maintained. Once again, that observation might have some point if there was an ambiguity to be resolved. 5. The appellant submitted that there was in fact an ambiguity in the wording of s 40 which reads: "(1) This section applies only to earners who are earners immediately before the commencement of the incapacity and who, during the 12 months immediately preceding the commencement of the period of incapacity, had earnings as an employee and who did not also have earnings other than as an employee." He submitted that if the section had to be applied it would have stated that it applied to every earner or all earners of the above description. There is some grammatical logic in that, but the answer can be understood when ss 40, 41 and 42 are compared. It can be seen that the reason for that wording is that any given claimant will have relevant earnings assessed under only one of the three sections. 6. The appellant submitted that s 39 would be given better effect by the repealed subs 40(2)(b)(ii) which referred back to the average weekly earnings during 4 weeks prior to the accident. That submission is of course misconceived. To suggest that Parliament intended effect to be given to a section which it had revoked is nonsense. - 4 - In any case, the section which was revoked required an assessment based on the lesser of two calculations and would have produced the same result as the one of which the appellant now complains. The appellant also referred to s 5(j) of the Acts Interpretation Act 1924, Heydon's case (1584) 3 Co Rep 7a, and CIR v Alcan New Zealand Ltd [1994] 3 NZLR 439. None of those references take the matter any further. The appellant may have suffered an unfair result because of the inflexible formula for calculation of weekly earnings. The Corporation is bound to act within the terms of the legislation and it has done so. The appeal must be dismissed. - DATED at WELLINGTON this 24th day of october 1996 D A Ongley District Court Judge