FEDERAL COURT OF AUSTRALIA

Howard Smith Industries Pty Ltd v Richards [1999] FCA 1144

WORKERS’ COMPENSATION – Seafarer – industrial hearing loss and tinnitus – no permanent impairment – hearing loss due to exposure to noise – exposure occurred during period of operation of Seamen’s Compensation Act 1911 (Cth) and after commencement of Seafarers Rehabilitation and Compensation Act 1992 (Cth) – hearing loss prior to commencement of Seafarers Rehabilitation and Compensation Act 1992 (Cth) did not disable seafarer from earning full wages – whether injury or disease incurred prior to commencement of Seafarers Rehabilitation and Compensation Act 1992 (Cth) when seafarer not disabled from earning full wages or not incapacitated for work compensable under Seafarers Rehabilitation and Compensation Act 1992 (Cth) – status of rights under Seaman’s Compensation Act 1911 (Cth) - Effect of Seafarers Rehabilitation and Compensation (Transitional Provisions and Consequential Amendments) Act 1992 (Cth).

Seafarers Rehabilitation and Compensation Act 1992 (Cth):  s 11, s 39, s 41, s 62

Seafarers Rehabilitation and Compensation (Transitional Provisions and Consequential Amendments) Act 1992 (Cth):  Pt II, s 4, s 5, s 6, s 7,

Seamen’s Compensation Act 1911 (Cth):  s 5, s 5B(5), s 6(1)

Accident Compensation Act 1985 (Vic):  s 88(1), (4)

Accident Compensation Commission v Fletcher [1990] VR 102 distinguished

Commissioner for Railways v Bain (1965) 112 CLR 246 distinguished

Associated Steamships Pty Ltd v Hore (1995) 61 FCR 506 applied

Comcare v Amorebieta (1996) 22 AAR 539 distinguished

Hoyle v Telstra Corporation Ltd (1997) 75 FCR 390 followed

HOWARD SMITH INDUSTRIES PTY LTD v JAMES PAUL RICHARDS

VG 62 of 1998

GOLDBERG J

MELBOURNE

3 SEPTEMBER 1999

REASONS FOR JUDGMENT

Introduction

1                     The applicant appeals to the Court pursuant to s 44 of the Administrative Appeals Tribunal Act 1975 (Cth) from a decision of the Administrative Appeals Tribunal (“the Tribunal”) on 2 February 1998 whereby the Tribunal set aside the decision of the applicant under review. The Tribunal decided the respondent was entitled to compensation under s 39 of the Seafarers Rehabilitation and Compensation Act 1992 (“the 1992 Act”) in respect of permanent impairment of hearing and tinnitus assessed at 15% of the maximum amount payable under that section, and to compensation under s 41 of the 1992 Act.  The Tribunal remitted the matter to the applicant for assessment for the amount of compensation payable to the respondent under s 41 of the 1992 Act and reserved liberty to the parties to apply to the Tribunal if they preferred to have the Tribunal assess the amount payable under s 41 of the 1992 Act.  The Tribunal also ordered that the respondent’s costs be paid by the applicant under s 92 of the 1992 Act. 

2                     Although a number of discrete grounds were raised in the notice of appeal, the only question of law agitated on the appeal was the proper construction of Pt II of the Seafarers Rehabilitation and Compensation (Transitional Provisions and Consequential Amendments) Act 1992 (Cth) (“the Transitional Act”) and s 11 of the 1992 Act as those provisions applied to the respondent’s claim for compensation.

3                     The principal issue which arises on the appeal is whether, under the provisions of the Transitional Act and the 1992 Act, the respondent is entitled to lump sum compensation in respect of the hearing impairment he had suffered prior to the commencement of the 1992 Act on 24 June 1993 as well as the hearing impairment he suffered after the commencement of the 1992 Act.  The issue is to be determined as a matter of statutory construction, principally the construction of Pt 2 of the Transitional Act and ss 11, 39(1) and 41(1) of the 1992 Act. 

Background

4                     The respondent was born on 3 November 1948, left school at the age of fourteen years, went to sea at the age of twenty years and has been employed as a seaman since that time.  He commenced his employment with the applicant on 2 June 1988 and is presently a Chief Integrated Rating on board the M.V. Portland which takes aluminium from Western Australia to Portland.  The respondent worked as an able bodied seaman on various ships between about 1968 and 1987, all of which were noisy.  He was exposed to noise particularly as a result of the maintenance work which he was required to carry out.  The respondent first noticed hearing loss and ringing in his ears sometime in the early 1980s.  Tests disclosed a hearing loss and ongoing audiology tests have disclosed that the respondent’s hearing has deteriorated since the early 1980s and has continued to deteriorate since 1988.

5                     An audiogram performed on 27 August 1991 disclosed permanent noise induced hearing loss which did not incapacitate the respondent for work.  The percentage loss was 12.5% plus 2% allowed for tinnitus.  A further audiogram performed on 9 January 1996 disclosed a hearing loss of 15.4% with a further 5% allowance for continuous moderate tinnitus, a total of 20.4%.  An audiogram performed on 16 October 1996 disclosed a hearing loss of 17.8% without increase for tinnitus.  An audiogram performed on 4 June 1997 disclosed a hearing loss of 21.0% plus 5% allowed for tinnitus.

6                     The Tribunal found that the respondent’s claim for compensation in respect of his permanent hearing impairment was lodged with the applicant on 1 May 1996 and that that date was the deemed date of injury for the purposes of s 11 of the 1992 Act.

7                     On 29 January 1997 the applicant denied liability in respect of the respondent’s claim for compensation for loss of hearing and on 7 April 1997 the applicant affirmed that determination.  The grounds on which the claim was denied were that proper notice of the claim was not given by the applicant, and that any loss of hearing occurred before 24 June 1993 and, therefore, was not compensable under the Seaman’s Compensation Act 1911 (Cth) (“the 1911 Act”).  On 28 April 1997 the respondent applied to the Tribunal for review of the applicant’s determination. 

8                     It was therefore necessary for the Tribunal to determine whether the respondent was entitled to compensation under the 1992 Act in respect of his total hearing impairment, comprising hearing loss and tinnitus, or whether he was only entitled to compensation in respect of that part of his total hearing impairment and tinnitus which occurred after 24 June 1993. 

Relevant legislation

9                     Before 24 June 1993 the provisions relating to the payment of compensation to seamen for work related injuries and diseases were found in the 1911 Act.  Section 5 was in the following terms:

“(1)     If personal injury by accident arising out of or in the course of the employment is caused to a seaman, his employer shall, subject to this Act, be liable to pay compensation in accordance with Schedule 1.

(2)       Provided that –

(a)       the employer shall not be liable under this Act in respect of any injury which does not disable the seaman from earning full wages:

…”

10                  Section 5A provided:

“(1)     Where any compensation is payable by the employer under this Act to, or in respect of, a seaman, or where a seaman suffers injury or disease in circumstances in which compensation would be payable under this Act but for the fact that the seaman is not rendered incapable of earning full wages or but for the operation of clause (i) or (ii) of sub-paragraph (b) of paragraph (2), of paragraph (4) or paragraph (4A) of Schedule 1, the employer shall pay the cost of such medical treatment and ambulance services in relation to the injury, or disease, as the case may be, as are, in the opinion of the Minister, reasonably necessary:

Provided that an employer shall not be liable to pay the costs of medical treatment and ambulance services both independently of and also under this section:

Provided also that if the seaman is left on shore at any port and there is a public hospital at or convenient to that port and the seaman elects to be treated elsewhere than in that hospital, the liability of the employer in respect of the cost of medical treatment and ambulance services shall be limited to the amount that would be payable for the treatment and services if the seaman were treated as an in-patient of that hospital.”

11                  Section 5B and Sch 3 of the 1911 Act provided for the payment of lump sum compensation for total loss of hearing or complete deafness of one ear.  Section 5B(5) of the 1911 Act provided for payment of compensation for partial and permanent loss of the efficient use of a part of the body (other than an eye).

12                  Section 5C(1) provided:

“Where –

(a)       a seaman is suffering from a disease and is thereby incapacitated for work; or

(b)       the death of a seaman is caused by a disease,

and the disease is due to the nature of the employment in which the seaman was engaged, the employer shall, subject to this Act, be liable to pay compensation in accordance with this Act as if the disease were a personal injury by accident arising out of or in the course of the seaman’s employment.”

13                  Section 16 of the Transitional Act repealed the 1911 Act on 24 June 1993.  It is necessary to refer to some of the provisions contained in Pt 2 of the Transitional Act which is headed “Transitional Provisions”:

“Purpose of this Part

4.         This Part deals with injuries etc. that happened before the commencing day.  It converts rights under the repealed Act [the 1911 Act] into corresponding rights under the Principal Act, [the 1992 Act] subject to the limitations imposed by the repealed Act.

Application

5.         This Part has effect despite anything contained in the Principal Act.

Application of Principal Act to pre‑existing injuries etc.

6.         Subject to this Part, the Principal Act applies in relation to an injury, loss or damage suffered by an employee, whether before or after the commencing day.

Entitlement to compensation

7.(1)    A person is not entitled to compensation under the Principal Act in respect of an injury, loss or damage suffered before the commencing day if compensation was not payable in respect of that injury, loss or damage under the repealed Act.

(2)       A person is not entitled to compensation under section 39 or 40 of the Principal Act in respect of a permanent impairment, or under section 29 of the Principal Act in respect of the death of an employee, being an impairment or death that occurred before the commencing day, if the person received compensation of a lump sum in respect of that impairment or death under the repealed Act.

…”

14                  The following provisions of the 1992 Act are relevant.  In s 3 “injury” is defined as meaning:

“(a)     a disease; or

 (b)      an injury (other than a disease) suffered by an employee, being a physical or mental injury arising out of, or in the course of, the employee’s employment; or

 (c)       an aggravation of a physical or mental injury (other than a disease) suffered by an employee (whether or not that injury arose out of, or in the course of, the employee’s employment), being an aggravation that arose out of, or in the course of, that employment

but does not include anything suffered by an employee as a result of reasonable disciplinary action taken against the employee, or failure by the employee to obtain a promotion, transfer or benefit in connection with his or her employment.”

15                  Section 11 of the 1992 Act is in the following terms:

“If an employee suffers a hearing impairment as a result of an injury, the employee is taken, for the purposes of this Act, to suffer the injury on the day on which the employee gives a notice of the injury under section 62.”

16                  Section 26(1) of the 1992 Act provides:

“If an employee suffers an injury that results in his or her death, incapacity for work, or impairment, compensation is payable for the injury.”

17                  Section 39(1) of the 1992 Act provides:

“If an injury to an employee results in a permanent impairment, compensation is payable to the employee for the injury.”

18                  Section 41(1) of the 1992 Act provides:

“If an injury to an employee results in a permanent impairment and compensation is payable for the injury under section 39, the employer is liable to pay additional compensation in accordance with this section to the employee for any non‑economic loss suffered by the employee as a result of the injury or impairment.”

The Tribunal’s Decision

19                  There was an issue before the Tribunal as to whether the respondent had complied with the relevant provisions for giving written notice of the injury to the applicant.  The Tribunal found that the respondent was not under any obligation to give notice of injury under s 6(1) of the 1911 Act and it was satisfied that the claim dated 1 May 1996 was in accordance with s 62(1) of the 1992 Act.  The issue of whether proper notice was given by the respondent to the applicant is not an issue on this appeal.

20                  The Tribunal found that the respondent suffered hearing loss and tinnitus as a result of exposure to noise in his employment throughout his time as a seaman both before and after he commenced employment with the applicant in 1988, and before and after the commencement of the 1992 Act, on 24 June 1993. The Tribunal found, on the basis of the audiograms, that in the period after the 1992 Act commenced (24 June 1993) the respondent’s percentage total binaural hearing loss increased from between 12.5% and 15.4% to 21%, an increase of approximately 7%.  The increase in hearing loss resulted from, or was contributed to in a material degree by, the respondent’s employment as a seaman in which he was exposed to ongoing noise.  He had suffered binaural hearing loss between the early 1980s and 1993 and suffered further loss between 1993 and 1997.  Similarly, the Tribunal found that the tinnitus was first noticed by the respondent in the early 1980s, and has been greatly aggravated by his noisy work environment. It was agreed that the respondent’s hearing impairment did not incapacitate him for work nor did it disable him from earning full wages. 

21                  The applicant contended before the Tribunal that the respondent’s hearing loss before the date when the 1992 Act commenced, namely 24 June 1993, was not compensable.  It therefore became necessary to determine whether the respondent was entitled to compensation under the 1992 Act in respect of his total hearing impairment comprising hearing loss and tinnitus, or only in respect of that part which occurred after 24 June 1993.  This issue arose because of the provision in s 5(2) of the 1911 Act that denied compensation where an injury did not disable a seaman from earning full wages.  The respondent has not to date been so disabled.  If the respondent’s condition was more appropriately characterised as a “disease” rather than a “personal injury by accident”, then s 5C(1) of the 1911 Act only entitled him to compensation if the disease incapacitated him for work.  The respondent has not to date been so incapacitated.  The applicant’s contention was that hearing loss suffered before the 1992 Act commenced, namely 24 June 1993, was not compensable because of the combined effect of s 5(2)(a) of the 1911 Act and the provisions of Pt 2 of the Transitional Act.

22                  The respondent’s contention before the Tribunal was that he was entitled to compensation for his whole hearing impairment under the 1992 Act because s 11 of that Act made 1 May 1996 (the date of the giving of the notice of injury) the deemed date of injury so that the Transitional Act had no operation.  The Tribunal therefore had to consider the effect of the deeming provision in s 11 of the 1992 Act and whether its operation was restricted by s 5 and s 7 of the Transitional Act.

23                  The Tribunal examined the judgments of Marks J and McGarvie J in Accident Compensation Commission v Fletcher [1990] VR 102 in which a deeming provision similar to that contained in s 11 of the 1992 Act was construed.  Compensation was claimed for industrial deafness which had occurred over a long period of time before and after 1985.  The provisions of the Workers Compensation Act 1958 (Vic) applied up to 1985 and relevant parts of the Accident Compensation Act 1985 (Vic) came into operation on 31 August 1985.  The Accident Compensation Tribunal made an award of compensation for the industrial deafness produced by exposure to industrial noise before and after 31 August 1985.  The Accident Compensation Commission appealed on the basis that compensation for so much of the industrial deafness as was due to exposure to industrial noise before 31 August 1985 was to be paid under the provisions of the Workers Compensation Act 1958 and not the Accident Compensation Act 1985.  The Full Court found, on the proper construction of the Accident Compensation Act 1985 that compensation was payable under its provisions in respect of the whole of the impairment of hearing due to exposure to industrial noise before and after the day the relevant parts of the Accident Compensation Act 1985 came into operation.  The Full Court relied in particular on a provision similar to s 11 of the 1992 Act which deemed a notional or fictional deafness on a particular day.  That provision was found in s 88 of the Accident Compensation Act 1985 in the following terms:

“88

(1)        Industrial deafness or a proportion of industrial deafness which has occurred in circumstances which do not create any liability to pay compensation under this Act shall be excluded from the assessment of deafness for the purposes of calculating compensation under this section.

(2)               Compensation for industrial deafness shall be in accordance with this section and sections 89, 93, 94, 98 and 99.

(3)               Unless the Tribunal determines otherwise industrial deafness shall be deemed to have occurred at a constant rate within the total number of years of exposure to industrial noise in employment.

(4)               Notwithstanding sub-section (3), the date of injury shall be deemed to be –

(a)               the last day of the worker’s employment in the service of the employer from whom compensation is recoverable; or

(b)               the date of the claim if at the date of the claim the worker is still employed in the service of an employer in whose employment the worker was exposed to industrial noise.”

24                  The issue in Fletcher (supra) was whether the effect of s 88(1) of the Accident Compensation Act 1985 was that compensation for industrial deafness, which was due to exposure to industrial noise before the Accident Compensation Act 1985 came into operation, should be paid under the Workers’ Compensation Act 1958 or whether s 88(4) operated to make the total deafness compensable under the Accident Compensation Act 1985.  The Full Court reached the conclusion that notwithstanding the existence of s 88(1), a provision similar to s 7(1) of the Transitional Act, industrial deafness which was an injury which “straddles the appointed day” was to be treated by a fiction (similar to that found in s 11 of the 1992 Act) as an injury suffered on one day because of the statutory definition of the date of injury in s 88(4) of the Accident Compensation Act 1985.  The Court found legislative indicia in the Accident Compensation Act 1985 that industrial deafness which occurred by gradual process was to be the subject of compensation under that Act whether it occurred before or after the coming into operation of that Act.

25                  The Tribunal also relied upon the reasoning of Barwick CJ in Commissioner for Railways v Bain (1965) 112 CLR 246 where at 257 His Honour said:

“According to the meaning which, in my opinion, should be given to the words of the amending section, the worker is to be entitled upon an application made after the enactment of the amendment to be compensated for his physical condition at the date of that application by a lump sum payment under s. 16.  No doubt his then condition is a product of past events but by the express words of the statute it is to be treated as having occurred at the date of his application, i.e. at a time subsequent to the making of the amendment.  This does give him a right to compensation for the present result of the progressive deterioration of his hearing caused during many prior years of boilermaking.” (Emphasis added)

26                  The Tribunal accepted the respondent’s submission that s 11 of the 1992 Act operated in a similar fashion to s 88(4) of the Accident Compensation Act 1985 and said that:

“because of s 11 of the 1992 Act, s 7 of the Transitional Act was not relevant as the whole deafness was to be taken as having occurred on 1 May 1996”.

27                  The Tribunal concluded that:

“the effect of s 11 of the 1992 Act, in the case of hearing impairment which ‘straddles’ the two Acts, is to deem the whole of the hearing impairment to have risen on 1 May 1996 and thus to be compensable under the 1992 Act.”

28                  The Tribunal then said:

“Applying s 11 for all purposes, the whole of Mr Richards’ hearing impairment is taken to have occurred on 1 May 1996 and therefore the Transitional Act does not apply and creates no problem for Mr Richards.”

29                  The Tribunal’s conclusion was that the respondent was entitled to compensation for his whole hearing impairment on the basis that it resulted from an injury suffered on 1 May 1996. The Tribunal held that s 7(1) of the Transitional Act does not prevent a person recovering compensation under the 1992 Act in respect of a hearing impairment part of which was sustained prior to the commencement of the 1992 Act because s 11 of the 1992 Act deemed the injury to have been suffered after the commencement of the 1992 Act.  The Tribunal considered that unless the respondent could carry forward his pre‑1992 Act hearing loss to the 1992 Act he would lose a valuable right to compensation.  This proposition involved a mis‑reading of the 1911 Act to which I shall refer.

30                  The Tribunal then assessed the compensation payable to the respondent in respect of his permanent hearing impairment on the basis that the whole of the hearing impairment was compensable under the 1992 Act, as the date of the injury was established as 1 May 1996 pursuant to s 11 of the 1992 Act.  The Tribunal assessed the compensation in accordance with a guide prepared by the Seafarers’ Rehabilitation and Compensation Authority in accordance with ss 39(5) and 42 of the 1992 Act. 

31                  The only ground of appeal relied upon at the hearing was in the following terms:

“The Respondent claims a lump sum payment of workers’ compensation for loss of hearing and tinnitus under s 39 and s41 of the [1992] Act.  The Respondent suffered a demonstrable hearing loss and tinnitus whilst the Seamen’s Compensation Act 1911 (“the 1911 Act”) was in force and before the commencement of the Act on 24 June 1993.  The Tribunal erred in law in that it failed to properly construe Part 2 of the Seafarers Rehabilitation and Compensation (Transitional Provisions and Consequential Amendments) Act 1992 (“the Transitional Act”) as that part applied to the Respondent’s claim for compensation.”

Submissions of the parties

32                  The applicant submitted that the provisions of the 1992 Act, including ss 26(1) and 39(1) which provided for the payment of compensation for injury to an employee operated, and were to be construed, subject to the provisions of Pt 2 of the Transitional Act.  The consequence was that as the respondent was not entitled to compensation under the 1911 Act in respect of the hearing impairment he had sustained prior to 24 June 1993, s 7 of the Transitional Act had the effect that he was not entitled to compensation in respect of that injury under the 1992 Act.  To find otherwise would be to create a situation where the respondent’s rights were greater on the commencing day of the 1992 Act than they had been on the previous day under the 1911 Act.  It was submitted that the provisions that created the respondent’s entitlement to compensation were to be found in ss 26(1) and 39(1) of the 1992 Act and that s 11 did not stand alone as an independent provision granting compensation or creating the right to compensation.  Rather, s 11 was a machinery provision which proceeded on the basis that the conditions of ss 26(1) and 39(1) had been met.

33                  The respondent submitted that s 11 of the 1992 Act meant that his impairment was to be assessed at the date of injury which was specifically fixed by s 11, for the purposes of the 1992 Act, as happening on the date on which notice of the injury was given.  The respondent submitted that the Transitional Act did not have the effect of overcoming s 11 of the 1992 Act, that Pt 2 of the Transitional Act applied where an injury had occurred prior to 24 June 1993 and that s 7 of the Transitional Act had no application because the respondent’s injury was not suffered before the commencing date of the 1992 Act due to the operation of s 11 of the 1992 Act. 

Reasoning

34                  The 1992 Act in conjunction with the Transitional Act brought in significant reforms and a new regime of compensation for seafarers.  The 1911 Act was repealed.  The background to this legislative reform is described and explained by the Full Court (Beaumont, Einfeld and Tamberlin JJ) in Associated Steamships Pty Ltd v Hore (1995) 61 FCR 506.  The passage to which I refer is extensive but it succinctly sets out the background against which the present appeal should be determined.  At 511‑512 the Full Court said:

“The decision to reform the previous legislation resulted from the recommendations of Professor Harold Luntz in his Review of Seamen’s Compensation, tabled in Parliament in 1988.

On the Second Reading Speech it was stated in relation to the Bill for the Principal Act:

‘This Bill introduces a new scheme of compensation and rehabilitation for seafarers who are injured in the course of their employment.  It will replace the outdated and inadequate Seamen’s Compensation Act 1911 with modern and comprehensive rehabilitation and compensation arrangements similar to those applicable to Commonwealth employees.

…

Professor Luntz’s review of seamen’s compensation was tabled in Parliament in June 1988.  Since that time the Luntz review recommendations have been the subject of extensive consultations involving shipowners, the maritime unions and the ACTU.  The outcome of this process is a bill which radically moves away from the outmoded compensation regime which the Seamen’s Compensation Act provides.  The new scheme will combine fair, earnings‑related benefits with comprehensive rehabilitation requirements and other measures aimed at getting injured employees restored to health and back to work as quickly as possibly.’  See House of Representatives, No 14, 12‑15 October 1992, p 2145.

The Bill for the Transitional Act was stated to be designed to ‘facilitate a smooth and equitable transition of benefit entitlements and other arrangements under the current Act to those which will be provided under the new legislation’.

It is clear that the Principal Act was designed to provide a totally new, detailed and comprehensive code with respect to the compensation of seafarers operative on and from 24 June 1993.

Accordingly, it is appropriate to approach the construction of the new Act and the transitional provisions on the basis that they were intended to be self‑contained unless express provision was made to the contrary in the Principal Act.  In other words the new Act is designed as a complete statement of all the statutory law on the issue of seafarers’ compensation as far as incapacity is concerned.  When speaking of the Criminal Code (WA), Dixon and Evatt JJ in Brennan v The King (1936) 55 CLR 253 at 263 pointed out:

“… its language should be construed according to its natural meaning and without any presumption that it was intended to do no  more than restate the existing law.  It is not the proper course to begin by finding how the law stood before the Code, and then to see if the Code will bear an interpretation which will leave the law unaltered.”

The meaning of a code is to be ascertained in the first instance from its language and the ordinary and natural meaning of that language is not to be qualified by considerations or implications deriving from the earlier law:  cf Bank of England v Vagliano Bros [1891] AC 107 at 144-150 and D C Pearce and R S Geddes, Statutory Interpretation in Australia (3^rd ed, 1988), pars [8.6]‑[8.10], pp 160‑163.

Because the Transitional Act repeals the 1911 Act in its entirety, any limitation on the rights of the worker must thereafter be found in the Transitional Act or the Principal Act.  This is not a case where the earlier Act has been amended or partially repealed and earlier rights preserved:  cf Mathieson v Burton (1970) 124 CLR 1 at 20‑22 per Gibbs J.  Rights under the 1911 Act no longer exist.  This is recognised by the reference in s 4 of the Transitional Act to the conversion of rights under the repealed Act to corresponding rights under the Principal Act.  The present case does not involve preservation of previously existing rights but rather extinguishment of those rights and a replacement of them with new and different rights which may, in a broad sense, in some instances ‘correspond’ with the old rights or entitlements under the previous legislation.

It is against this background that the construction of ss 4, 7 and 12 of the Transitional Act must be approached.

Section 4 is a descriptive section.  It summarises and describes in a generalised fashion the purpose and anticipated effect of ss 4 to 14 of the Transitional Act.  That section sets out the purposes against which, in cases of ambiguity, the Act must be construed.  It does not itself impose obligations, limitations or qualifications on entitlement or liability under the Transitional Act or under the Principal Act.

It is s 6 of the Transitional Act which applies the Principal Act to injuries, loss or damage suffered before the commencing date.  That section is expressed to be ‘Subject to this Part’.  Accordingly, it is subject to any provisions in that Part which qualify the operation of the Principal Act.”

It is also relevant to observe that the Explanatory Memorandum for the Transitional Act states that:

“The transitional provisions that increase an entitlement or create an entitlement on and after the commencing day to a person with a pre-existing injury are:

·        the provision that applies weekly incapacity benefits at the new rate; and

·        the provision that creates an entitlement for compensation for household and attendant care services.”

As the applicant submitted, these are the only respects in which the transitional provisions are said to increase or create an entitlement on and after the commencing day to a person with a pre-existing injury.  The provisions do not create or include an entitlement to compensation in circumstances where hitherto the seafarer was not entitled to compensation because he was not disabled from earning full wages or was not incapacitated for work.

35                  The Tribunal concluded that because s 11 of the 1992 Act deemed the total deafness to have occurred on the one date, s 7 of the Transitional Act was irrelevant and that the effect of s 11 of the 1992 Act, in the case of hearing impairment which straddled the 1911 Act and the 1992 Act, was to deem the whole of the hearing impairment to have arisen on 1 May 1996 which must therefore be compensable under the 1992 Act.  However, this conclusion pays insufficient regard to ss 4, 5, 6 and 7 of the Transitional Act.  What the Tribunal, in effect, did was to give paramount force to the provisions of s 11 of the 1992 Act and treat it as a provision which created an entitlement to compensation.  This is not the task which s 11 undertakes.  That task is committed to s 26(1) and s 39(1) of the Principal Act.  Rather, s 11 is a subsidiary provision which proceeds on the basis that the conditions of s 26(1) and s 39(1) have been met, and seeks to resolve the once vexed question as to the point of time at which a hearing loss building up over a period of time occurs. 

36                  Read by itself, s 11 confers no independent right to compensation and can only be understood and be effective by reference to other provisions, namely s 26(1) and s 39(1), which do create an entitlement to compensation. 

37                  Because of the manner in which industrial deafness and hearing impediments occur, it is necessary to identify a point of time at which the disease or injury which results in deafness and impediments occurred.  As Marks J said in Accident Compensation Commission v Fletcher (supra) at 113‑114:

“This difficulty [of determining the date of injury] stems from the nature of industrial deafness, which is a condition or impairment consequential on a large number of traumata or ‘injuries’ rather than an ‘injury’ in itself.”

Industrial deafness occurs by a gradual process over a period of time.  In Commissioner for Railways v Bain (supra) Barwick CJ described boilermaker’s deafness in terms apposite to the description of industrial deafness in these terms (251):

“It seems that boilermaker’s deafness results from successive impacts of sound on the terminal nerve system connected with hearing and that the effect of these successive traumas is to cause cumulative deterioration in the capacity to hear.”

(See also Burls v A A Mitchell Pty Ltd [1979] VR 417).

38                  The respondent submitted that s 11 applied to all injuries that have caused the respondent’s deafness both before and after coming into operation of the 1992 Act.  However, ss 11, 26(1) and 39(1) cannot be read alone and must be considered in the context of the relevant provisions of Pt 2 of the Transitional Act.  These provisions contain limitations or restrictions on the extent to which pre‑1992 Act injuries are brought under the umbrella of the 1992 Act. 

·        Section 4 of the Transitional Act makes it clear that rights which existed under the 1911 Act in relation to injuries that happened before the commencing date of the 1992 Act are converted into corresponding rights under the 1992 Act but “subject to the limitations imposed by the repealed [the 1911] Act”. 

·        Section 5 emphasises the point by providing that Pt 2 “has effect despite anything contained in the Principal Act”. 

·        The point is emphasised further by the opening words of s 6 “Subject to this Part” the 1992 Act applies in relation to the injury suffered by an employee whether before or after the commencing day. 

·        Section 7(1) provides that a person is not entitled to compensation under the 1992 Act in respect of an injury suffered before the commencing day if compensation was not payable in respect of that injury under the 1911 Act.  Section 6 must be read as subject to that provision.

39                  The respondent submitted that s 6 applies the 1992 Act to a pre-1992 Act injury whereas s 7 only related to injury suffered before the commencing day of the 1992 Act.  Putting the matter another way, the respondent was in effect saying that in a “straddle” situation, that is to say in relation to an injury which occurred both before and after the commencing day of the 1992 Act, only s 6 was relevant and applicable.  However that submission fails to give adequate consideration to the opening words of s 6 “Subject to this Part …”.

40                  The respondent submitted that he sustained an injury prior to 24 June 1993 for which he might, under the 1911 Act, be able to receive the cost of medical treatment but not compensation: s 5A(1) of the 1911 Act.  Because he was not disabled from earning full wages and was not incapacitated for work he had a potential right to compensation, but the 1992 legislation had changed the policy in relation to compensation.  It is true that the potential right to compensation is carried forward in the sense of being converted into a right under the 1992 Act (see for example, ss 4 and 12 of the Transitional Act) but that right is converted, in the terms of s 4 of the Transitional Act, “subject to the limitations imposed by the repealed Act [the 1911 Act]”.  Those limitations include the provision in s 5(2)(a) that compensation is not payable where the seaman is not disabled from earning full wages and the requirement in s 5C(1) that compensation is only payable where the disease incapacitates the seaman for work or causes his death.

41                  The respondent recognised that the right to compensation which he had under the 1911 Act (and which was converted into a right under the 1991 Act) was a potential and inchoate right which would ripen into an ability to claim compensation should the respondent’s deafness reach the point where he was unable to earn full wages or was incapacitated for work as a result of the hearing impairment.  However, there is no provision in the 1992 Act which gives a right to compensation in respect of that injury (which does not result in an inability to earn full wages) to the extent to which it was incurred prior to the commencing day of the 1992 Act while the respondent is still able to earn full wages.  It was in this respect that the Tribunal erred when it said that unless the respondent could carry his pre‑24 June 1993 hearing loss forward to the 1992 Act the respondent would lose a valuable right to compensation.  That valuable right was not lost and is not lost by virtue of the provisions of ss 4 and 12 of the Transitional Act.

42                  The scheme of Pt 2 of the Transitional Act is that seamen, such as the respondent, who had rights under the 1911 Act in respect of injuries or diseases which had been sustained or incurred prior to the commencing date of the 1992 Act, were to be no better nor worse off than they had been under the 1911 Act except to the extent provided by Pt 2 of the Transitional Act.  As the Explanatory Memorandum pointed out, such provisions are found in s 7(5) of the Transitional Act in relation to weekly incapacity benefits and in s 7(4) in relation to compensation for household and attendant care services in respect of incapacity which occurred prior to the commencing date of the 1992 Act.

43                  It is therefore not correct to say, as the respondent submitted, that the Transitional Act and the 1992 Act changed the policy of the legislation in relation to compensation to give a right to compensation in the respondent’s circumstances which prior to the commencing date of the 1992 Act had not existed.  Section 4 of the Transitional Act may have converted rights which existed under the 1911 Act into corresponding rights under the 1992 Act but at all times these rights were “subject to the limitations imposed by the repealed [1911] Act”.

44                  The respondent, as did the Tribunal, relied in particular on the decision in Commissioner for Railways v Bain (supra).  In that case the High Court was concerned to construe the Workers’ Compensation Act 1926‑1960 (NSW).  Section 16(1) of that Act provided:

“… the compensation payable by the employer for the injuries mentioned in the first column of the table hereunder set forth shall, if the worker so elects, be the amounts indicated in the second column of that table.”

Section 16(1)A of that Act, which was introduced into the Act on 1 December 1960, provided:

“Where an injury mentioned in the first column of the said table is a disease which is of such a nature as to be contracted by a gradual process and which has not resulted in incapacity, such injury shall, for the purpose of determining a worker’s right to the amount indicated in the second column of the said table, be deemed to have happened at the time when such worker makes his claim for compensation.

In this sub‑section ‘disease’ includes the condition known as ‘boilermaker’s deafness’ and any deafness of the like origin …”

The worker brought his application for compensation after this amendment came into operation but his claim was made in respect of the full extent of his loss of hearing due to boilermaker’s deafness suffered before and after the amendments.

45                  Barwick CJ said at 256:

“The amendment therefore provides, it seems to me, that if you find that a worker has suffered, or is suffering, an injury of the kind listed in the first column of the table which is not incapacitating but which is the result of a disease of gradual onset, then that injury shall be deemed to have happened at the time the worker makes his claim for compensation.”

Prior to June 1951, a worker who sustained an injury could only have obtained an award of compensation if total or partial incapacity to work had resulted from the injury or disease.  The appellant in Bain submitted that the construction of the amendment to which Barwick CJ referred gave it a retrospective operation because the worker would be compensated for results of trauma which had occurred before 1951 in respect of which compensation could not have been obtained prior to 1951.

46                  Barwick CJ responded to that submission at 257-258 in the following terms:

“But, whilst in construing a statute there is a presumption against giving it a retrospective or retroactive operation, the language of the statute and the subject matter with which it deals may make it clear that the legislature intends the particular result, whether or not it involves giving retrospective or retroactive operation to the statute.  See Sunshine Porcelain Potteries Ltd. v. Nash [1961] AC 927 at pp 937, 938.

According to the meaning which, in my opinion, should be given to the words of the amending section, the worker is to be entitled upon an application made after the enactment of the amendment to be compensated for his physical condition at the date of that application by a lump sum payment under s. 16.  No doubt his then condition is a product of past events but by the express words of the statute it is to be treated as having occurred at the date of his application, i.e. at a time subsequent to the making of the amendment.  This does give him a right to compensation for the present result of the progressive deterioration of his hearing caused during many prior years of boilermaking

…

In this case, both the language of the statute and the circumstances with which it is dealing, in my opinion, make it clear that if the language in its natural meaning involves any retrospective or retroactive operation, which I very much doubt and find no need to decide, the legislature intended it.”

Menzies J made similar observations at 264‑265:

“The contentions that the appellant did advance are untenable.  The first was that the law, which it was assumed provided that boilermaker’s deafness should be an injury which was deemed to have happened at the time when a worker suffering from it makes his claim for compensation, nevertheless had no application to a worker suffering from boilermaker’s deafness before the enactment of the law – that is, s. 16(1A) of the Workers’ Compensation Act (N.S.W.) – because, so it was said, to apply the law to such a worker would be to give it retrospective effect.  The second was that, as s. 16 provided the only means for compensation for boilermaker’s deafness not resulting in incapacity for work, a worker suffering from that injury could not in any real sense elect to claim thereunder because he had no alternative but to do so.  The judgment of Judge Conybeare in the Commission and Walsh J. in the Full Court entirely disposed of these contentions and I say no more about them.”

At 270 Windeyer J said:

“I can see no warrant in its [s 16(1A)] language for confining its effect in the way suggested.  The time of the worker’s claim for compensation for the consequences of a disease contracted by a gradual process is made the date of his injury for the purposes of s. 16.  There is nothing in the Act to suggest that he is not to have compensation according to s. 16 for his loss of hearing as at that date, no matter when or over what period of time that loss occurred or developed.  To confine the operation of the amendment in the way the appellant proposes would be to limit a right, newly created, by reference to the law as it had been before it was created.”

47                  The passages in Bain to which I have referred demonstrate why that case is distinguishable from the circumstances and legislation presently before the Court.  There was no provision in the New South Wales legislation similar to the provisions found in Pt 2 of the Transitional Act.  The members of the High Court made it clear they were undertaking an exercise in statutory construction seeking to determine the legislative intent from the language of the statute and the subject matter with which it was concerned.  They found a clear intent that the whole of the injury, which had a progressive deterioration and a gradual onset, was deemed to have occurred on the date of the application.  In the present case, the legislature has made its intention clear in a different way as s 5 of the Transitional Act states “This Part has effect despite anything contained in”the 1992 Act.  In Bain there were express words from which the Court determined a retrospective operation.  The express words in the Transitional Act point to an opposite conclusion in respect of the circumstances presently before the Court.  I refer in particular to ss 4, 6 and 7.

48                  The Tribunal’s reliance on Accident Compensation Commission v Fletcher (supra) was similarly misplaced.  In that case, the Appeal Division of the Supreme Court of Victoria was concerned to construe the Accident Compensation Act 1986 (Vic) and in particular s 88(4) which deemed the date of injury for industrial deafness to be:

“(a)     the last day of the worker’s employment in the service of the employer from whom compensation is recoverable; or

 (b)       the date of the claim if at the date of the claim the worker is still employed in the service of an employer in whose employment the worker was exposed to industrial noise.”

The members of the Court found indicia in the legislation that the legislative intent was that compensation be payable in respect of the extent of deafness which was produced by exposure to industrial noise before and after the appointed day on which relevant parts of the Accident Compensation Act came into operation.  As in Bain,there were no provisions in the Victorian legislation similar to the provisions in Pt 2 of the Transitional Act.  However there were provisions which pointed to a legislative intent that deafness occurring before the commencement of the Accident Compensation Act was to be the subject of compensation under that Act.  Section 4 of the Accident Compensation Act provided:

“4.(1)    Notwithstanding anything to the contrary in this Act ‑

(a)         this Act, other than section 129, applies to and in relation to an injury to a worker arising out of or in the course of employment on or after the appointed day;

(b)         this Act, other than section 129, does not apply to or in relation to an injury to a worker arising out of or in the course of employment before the appointed day; and

(c)          section 129 has effect in relation to injuries occurring by way of gradual process.”

McGarvie J said in Fletcher at 106:

“In my opinion, s 129 shows unequivocally that in cases of an injury of industrial deafness occurring by way of gradual process compensation is payable in respect of the total impairment of hearing due to exposure in employment to industrial noise before and after the appointed day”

McGarvie J then concluded at 107:

“Section 129 has the effect of rendering the last employer liable for an injury of industrial deafness if that employer’s employment actually caused the industrial deafness or one of the other specified developments of it, if the industrial deafness occurred by way of gradual process over time and if the industrial deafness is due to the nature of that employment.”

It is not necessary to refer in any detail to s 129.  Suffice it to say that it was in quite different terms to the statutory provisions presently under consideration.  Part 2 of the Transitional Act points to a different conclusion in the circumstances presently before the Court.

49                  The Tribunal was influenced in reaching its conclusion by the reasoning of the Full Court in Associated Steamships Pty Ltd v Hore (supra).  In that case, the claimant had suffered injuries and had been receiving compensation by way of weekly payments under the 1911 Act which, by virtue of s 5D of the 1911 Act, were subject to a maximum amount of $68,000.  The issue before the Full Court was whether the monetary limit provided in s 5D was preserved by the Transitional Act or whether the monetary limit no longer applied.  The Full Court upheld the Tribunal’s view that the monetary limit imposed under s 5D was not preserved by the Transitional Act and that the claimant was entitled to compensation payments after the date of commencement of the 1992 Act in accordance with the provisions of the 1992 Act.  The Full Court said at 513:

“We agree with the observations made by her Honour with respect to s 7(3).  The existence of this specific provision, which limits the amount of compensation in cases of permanent impairment or death to the same amount of compensation that would have been payable under the 1911 Act, as if the Principal Act had not been enacted, points to the conclusion that no similar restriction was intended to apply in cases of incapacity specifically and separately provided for in Div 3 of Pt 2 of the Principal Act.  As her Honour pointed out, it would have been a simple matter for clear and express provision to have been made if such was the intention of the legislation.”

The Tribunal used this last sentence to reason that if s 11 of the 1992 Act was not intended to apply to hearing impairment which occurred before 24 June 1993 “then one would expect this to have been explicitly provided”.

50                  For the reasons to which I have referred there are explicit provisions in the Transitional Act which show that an injury incurred or suffered before 24 June 1993 is not compensable if it has not yet disabled the claimant from earning full wages or incapacitated the claimant for work.  It should also be noted that Hore was concerned with the payment of weekly incapacity benefits which were specifically provided for in the Transitional Act (s 7(5)), whereas the present case is concerned with impairment benefits which were not the subject of specific provision.  As noted earlier, the Explanatory Memorandum for the Transitional Act made it clear that weekly benefits for a pre‑existing injury were to be paid at the new rates provided by the 1992 Act.  Accordingly the reasoning in Hore does not assist the respondent’s case.

51                  The respondent relied on Comcare v Amorebieta (1996) 22 AAR 539 in support of his submission that he was entitled to compensation under the 1992 Act in respect of the whole of his hearing impairment which had occurred both before and after the commencing date of the 1992 Act.  In Amorebieta the claimant had a degenerative back condition prior to his employment by the Commonwealth Bank.  After he commenced employment with the Commonwealth Bank an incident occurred at work in January 1992 when he injured his back which aggravated his condition.

52                  Section 24 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) provided that:

“(1)     Where an injury to an employee results in a permanent impairment, Comcare is liable to pay compensation to the employee in respect of the injury”.

…

(5)       Comcare shall determine the degree of permanent impairment of the employee resulting from an injury under the provisions of the approved Guide.”

Jenkinson J held that the claimant was entitled to be compensated for the degree of permanent impairment which had resulted from the aggravation whatever had been the extent of his earlier degenerative condition.  His Honour seized on the words “results in” in s 24(1) and “resulting from” in s 24(5) in concluding that the claimant was entitled to compensation for the consequences of the aggravation of his back condition.  His Honour said at 552:

“There is in my opinion no reason to think that the inclusion of the phrase ‘resulting from the injury’ in s 24(5) is designed to limit the operation of s 24(1), which imposes a liability to pay compensation in respect of the aggravation of the respondent’s spinal disease.  The measure of that compensation is the degree of permanent impairment which has resulted from that aggravation of the disease and in contemplation of law the degree of impairment to which the aggravation brings the respondent’s spine is caused by – ‘result from’ – that aggravation, whatever the lesser degree of impairment was which preceded that aggravation, and whatever the extent to which events and degenerative processes preceding that aggravation contributed to cause that degree of impairment.”

The respondent relied on this reasoning because s 26(1) and s 39(1) of the 1992 Act contain similar expressions – s 26(1) “an injury that results in … impairment …”, s 39(1) “an injury to an employee results in a permanent impairment …”.  The respondent says in consequence that the whole of his hearing impairment results from the post 24 June 1993 incidents.

53                  However, in Amorebieta the circumstances were quite different.  Although the claimant had a degenerative back condition prior to his employment by the Commonwealth Bank, the degeneration was asymptomatic except for a few occasions.  The Tribunal was satisfied that his pain and restrictions resulted from the 1992 incident.  There was no impairment in the claimant’s ability to work prior to the 1992 incident.  That is not the position in the present case.

Conclusion

54                  The Tribunal therefore erred in law in its construction of the relevant provisions of Pt 2 of the Transitional Act.  By virtue of s 4 of the Transitional Act the respondent’s right to claim compensation for the deafness he had sustained prior to the commencement of the 1992 Act, that is the right under the 1911 Act, was a right which was converted into a corresponding right under the 1992 Act.  However, that right was subject to the limitation imposed by the 1911 Act, namely that he could not obtain compensation for that deafness if he was not disabled from earning full wages or (if his condition was more appropriately characterised as a disease) he was not incapacitated for work.  As s 5 of the Transitional Act provided, that right was so limited notwithstanding the provisions in the 1992 Act.  Although the 1992 Act applied in relation to the respondent’s pre‑1992 Act industrial deafness, that Act applied subject to Pt 2 of the Transitional Act.  Section 7(1) of the Transitional Act consolidated the position which resulted from ss 4, 5 and 6 of the Transitional Act in relation to the respondent’s pre‑1992 Act industrial deafness by denying him the right to compensation in respect of that deafness because compensation was not payable in respect of it under the 1911 Act.

55                  For the reasons to which I have already referred s 11 of the 1992 Act does not create an independent right to compensation and any right which the respondent has to compensation under the 1992 Act is to be derived from s 26(1) and s 39(1) of that Act.  Such provisions however are subject to the provisions of Pt 2 of the Transitional Act.

56                  The conclusion I have reached is supported by the reasoning of the Full Court (Wilcox, Lindgren and Emmett JJ) in Hoyle v Telstra Corporation Ltd (1997) 75 FCR 390.  In that case the appellants had become totally incapacitated for work and had received weekly payments of compensation under the Compensation (Commonwealth Government Employees) Act 1971 (Cth) (“the 1971 Act”).  That Act was repealed by the Safety, Rehabilitation and Compensation Act 1988 (Cth) and the appellants made claims for compensation under that Act in respect of permanent impairment which had resulted from an “injury” as defined in s 24 and s 27 of the 1988 Act.  That section entitled them to compensation in respect of their injuries and compensation for non‑economic loss suffered as a result of their injuries.  The 1988 Act contained Pt X which was headed “Transitional Provisions, Consequential Amendments and Repeals”.  The Full Court analysed Pt X in the following terms (392):

“Section 124(1) provides that, subject to Pt X, the Compensation Act applies in relation to an injury suffered by an employee, whether before or after the Commencing Day.  It will be apparent that, in the absence of a relevant exclusion in Pt X, Telstra would be liable to pay amounts of compensation to each of the appellants under s 24 and, possibly, under s 27.

The question in these cases is whether liability is excluded by either or both of s 124(3) and (4).  Section 124(3) and (4), in so far as relevant to the appellants, provide as follows:

‘(3)      A person is not entitled to compensation under section 24 … in respect of a permanent impairment, … being an impairment … that occurred before the commencing date, if:

…

(b)        the person was not entitled to receive compensation of a lump sum in respect of that impairment …

…

(iii)       … under the 1971 Act as in force when the impairment … occurred.

(4)        The amount of compensation (if any) that a person is, by virtue of this section, entitled to receive under section 24 … in respect of a permanent impairment … being an impairment … that occurred before the Commencing day, shall be the same as the amount of the compensation that would have been payable to that person, if this Act had not been enacted, under:

…

(c)        … the 1971 Act as in force when the impairment … occurred.’

Before considering the effect of s 124(3) and (4) in the present context, it is desirable that we consider the scheme of s 124 generally.

Section 124(1A) of the Compensation Act provides that, subject to Pt X, a person is entitled to compensation under that Act in respect of an injury suffered before the Commencing Day if compensation was, or would have been, payable to the person in respect of that injury under, inter alia, the 1971 Act.  Section 124(2)(c), on the other hand, provides that a person is not entitled to compensation under the Compensation Act in respect of an injury suffered before the Commencing Day if compensation was not payable in respect of that injury under the 1971 Act as in force when the injury was suffered.

Those provisions are consistent with a general principle which appears to be discernible in s 124(1A) and (2) that an employee should not be worse off as a result of the enactment of the Compensation Act and the repeal of the 1971 Act but, generally, should be no better off.  The succeeding subsections in s 124 seem designed to give effect to that general principle.”

The Full Court concluded at 394:

“Upon analysis of the whole of s 124, we consider that it is clear that the Parliament proceeded on the basis that, where the entitlement to compensation under the Compensation Act has a relevant nexus with a period before the Commencing Day, the appropriate general principle should be that an employee is not to be deprived of any compensation that would have been payable under the 1971 Act but for its repeal, but is not to be entitled to any greater compensation than would have been payable under that Act.”

The Full Court also observed at 398:

“We are not persuaded that the changes in policy are sufficient to override the language of s 124(3) and (4), read in the light of the general principle, discernible in s 124 as a whole, that an employee whose entitlement has a nexus with a period before the Commencing Day is not intended to be in a better position in respect of a permanent impairment simply because of the enactment of the Compensation Act and the repeal of the 1971 Act.  The changes are not such as would indicate that there was a legislative intention to give to an employee who was totally incapacitated at the Commencement Day, the right to recover a lump sum payment under s 24 of the Compensation Act which that employee would not have been entitled to recover under s 39 of the 1971 Act if the Compensation Act had not been enacted.”

Although one must be careful when reasoning by analogy from different statutory provisions, I consider that these observations support the conclusion I have reached.

57                  The appeal should therefore be allowed and the decision of the Tribunal set aside.  As the Tribunal was considering the respondent’s claim for compensation in respect of an injury which had occurred after the commencing date of the 1992 Act, it will be necessary for that claim to be determined.  Subject to what the parties may say, I would propose that the matter be remitted to the Tribunal differently constituted to be heard according to law.  I will hear the parties on the issue of the costs of the appeal.

Associate:

Dated:              3 September 1999