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Accident Compensation Cases

Accident Rehabilitation & Compensation Insurance Corporation v Wikeepa (HC, 12/08/99)

Judgment Text

RESERVED JUDGMENT OF WILLIAMS J 
WILLIAMS J
The appellant, the Accident Rehabilitation and Compensation Insurance Corporation (ARCIC) appeals with leave against a reserved decision delivered by Beattie DCJ in the District Court at Tauranga on 22 May 1998 allowing an appeal by Ms Wikeepa against ARCIC's decision not to permit backdating of her independence allowance to a date earlier than the date of assessment of her injuries. The learned District Court Judge upheld ARCIC's decision declining to pay Ms Wikeepa a lump sum in respect of injuries suffered on 11 December 1990: no appeal has been brought against that part of the decision 
The background facts are not in dispute. Ms Wikeepa suffered ankle injuries as a result of an accident on 11 December 1990 On 8 March 1992 she applied for cover for personal injury by accident under the Accident Compensation Act 1982. Cover was granted. On 1 July 1992 the 1982 Act was repealed and replaced by the Accident Compensation and Rehabilitation Insurance Act 1992, s 54 of which provided for an independence allowance. This was a new allowance which did not exist under the 1982 Act. 
On 6 December 1996 Ms Wikeepa applied to ARCIC for an independence allowance pursuant s 54, asking that the allowance be backdated to the date of her accident (and for lump sum compensation). Section 54 as it then applied required an assessment of the person's “degree of disability” which was effected by the administration of a prescribed questionnaire determining a person's ability to carry out daily activities. Ms Wikeepa's assessment was carried out on 10 January 1997 and she was assessed as having a disability of 100% (reduced by 10% in respect of a lump sum payment granted under the 1982 Act in respect of another injury). On 21 March 1997 ARCIC issued its decision advising of the assessed disability and the quantum of the independence allowance and backdating it to 10 January 1997, the date of assessment For reasons which will appear, it is of some importance to note that Ms Wikeepa applied on 23 May 1997 for a review of the date to which her independence allowance had been backdated but did not apply to review any other aspect of the decision. 
As a result of the enactment of the Accident Rehabilitation and Compensation Insurance Amendment (No 2) Act 1996 s 13, the original s 54 was repealed and new s 54 and 54A relating to the independence allowance were substituted with effect from 1 July 1997. The new s 54(7) provided for payment of the independence allowance to be backdated to the date of the claim for cover for personal injury 
Ms Wikeepa's application for review was heard on 14 August 1997 and a decision issued on 8 September 1997. In that decision the review officer applied the original s 54 and decided that Ms Wikeepa's independence allowance was payable only from 10 January 1997, the date of the assessment 
Ms Wikeepa appealed to the District Court. Her appeal was heard on 5 May 1998 and judgment was delivered on 22 May. In his decision relating to the independence allowance, Beattie DCJ, after reciting the original s 54 and noting its repeal and the terms of the substituted s 54(7), held (p 6) 
“Thus it was that by the date of the review hearing section 54(5) had been repealed and had been replaced by section 54(7). 
There is nothing in the transitional provisions of that Amendment Act which is applicable to the particular subsection regarding the date of payment. 
Accordingly I find that the Review Officer was incorrect to apply the provisions of section 54(5) (the repealed provision) when he came to consider his decision I September 1997 ”
Beattie DCJ held that because Review Officers could substitute their own decision for that earlier made (p 7) “the Review Officer must have regard to the statutory regime that is in being at the time that review is being undertaken” even though, in Ms Wikeepa's case, the Review Officer omitted any mention of the repeal of s 54 and the point had not been picked up during the hearing before the learned District Court Judge. He held (pp 7-8): 
“I find that it was not open to the Review Officer to consider the appellant's request by reference to a statutory provision which had by then been repealed. To apply the amended statutory provision was not in any way giving that provision retrospective operation. 
The fact that the particular provision relies on an event which has passed for its operation in the future does not make it retrospective. In fact all that the amendment did was to change the event in the past from one to another for the future operation of the provision. 
For the avoidance of doubt I find that the concept of review as contained in sections 89 and 90 of the Act is different from the concept of appeal as provided in sections 91 and 92 of the Act. In the matter of appeal this court is being called upon to determine whether the decision of the Review Officer was correct. In such a case this court is an appellate body and its task is to consider the issue raised in the appeal in the light of the facts and the law as it stood at the time that review decision was made. 
In those circumstances it would not be open to this Court on appeal to find that the Review Officer's decision was wrong merely because between the date of the review decision and the date of the hearing of the appeal the relevant statutory provision had changed so as to make that decision wrong were it to have been made at the date of the appeal 
And concluded (p 9): 
I have considered the provisions of s 20(e)of the Acts Interpretation Act 1924 but find that none of its provisions apply to enable the repealed provision to still apply in the circumstances of this case. Whilst the decision at first instance was validly done at the time, the whole question of the Right and the claim was required to be looked at afresh and a new decision made based on the evidence and material presented at review. 
For the foregoing reasons I find that the decision of the Review Officer was incorrect as it determined that the appellant's independence allowance could not be backdated earlier than the date of assessment when the prevailing statutory provision enabled it to be so. 
The plain meaning of section 54(7)(a) is that the independence allowance is payable from the date on which the person to whom it is payable lodged a claim for cover in respect of the personal injury from which the impairment results. In the context of this appellant she lodged a claim for cover for her ankle injury, which is the injury from which the impairment results, on 8 March 1992. 
Whilst that date is a date prior to the enactment of the 1992 Act in which was created the entitlement known as an independence allowance, I find the plain meaning of the subsection does enable the payment to be backdated to that date 
I find there is nothing in that transitional provisions which would indicate that payment cannot stretch back further than the commencement of the Act which created the independence allowance. 
The original s 54 relevantly provided 
54. Independence allowance — 
(1)
Subject to this section, every person who has cover under this Act is entitled to receive an independence allowance where the person's personal injury has resulted in a degree of disability of 10 percent or more 
(2)
Any entitlement to the independence allowance shall commence not earlier than 13 weeks after the date on which the personal injury causing that disability was suffered 
(5)
The Corporation shall not pay any independence allowance unless the assessment of the degree of disability of the person in respect of whom it is to be paid has been made in accordance with — 
(a)
Scales prescribed under this Act which may be based on impairment or disability or a combination of impairment and disability, or 
(b)
In the absence of the scales referred to in paragraph (a) of this subsection, the American Medical Association Guides to the Evaluation of Permanent Impairment (Second Edition) — 
and any such allowance shall be payable from the date of the assessment or the date determined under subsection (2) of this section, whichever is the later. 
(12)
The Corporation may, on its own motion, or at the request of the injured person, reassess the degree of disability of that person and make any appropriate adjustment to the independence allowance payable as from the commencement of the next quarter, but not more than 1 reassessment may be undertaken in any 12-month period 
(13)
In any assessment of disability under this section, any disability that does not arise from personal injury covered by this Act, or personal injury by accident covered by the Accident Compensation Act 1972 or the Accident Compensation Act 1982, and in respect of which a claim has been accepted by the Corporation, shall be disregarded. 
(14)
Where any person who has received a payment under section 119 of the Accident Compensation Act 1972 or section 78 of the Accident Compensation Act 1982 is assessed for the purposes of establishing an entitlement to an independence allowance, the person's disability assessed under subsection (5) of this section shall be reduced by the percentage or percentages of permanent loss or impairment of bodily function upon which any payment or payments under section 119 of the Accident Compensation Act 1972 or section 78 of the Accident Compensation Act 1982 were based. 
(15)
For the purposes of assessments under this section, regulations made under this Act may — 
(a)
Extend or modify the American Medical Association guides to the Evaluation of Permanent Impairment (Second Edition) or any subsequent edition of those guides that may be prescribed for the purposes of this section: 
(b)
Prescribe scales other than the American Medical Association Guides to the Evaluation of Permanent Impairment (Second Edition) to be used for the purposes of this section, which may be later editions of those guides, or other scales ”
The Regulations to which s 54 referred were the Accident Rehabilitation and Compensation Insurance (Independence Allowance Assessment) Regulations 1993 (SR 1993/195) which required the claimant to undergo a disability assessment by an assessor using the Functional Limitations Profile appearing in the Schedule. 
The substituted ss 54 and 54A relevantly read from 1 July 1997 
“54. Independence allowance — 
(1)
Subject to the provisions of this section, every person who ha s cover under this Act is entitled to receive an independence allowance at the appropriate prescribed rate if the person's personal injury has or personal injuries have resulted in a degree of whole-person impairment of 10 percent or more. 
(2)
No person's entitlement to the independence allowance shall be assessed or reassessed until — 
(a)
The Corporation has received a certificate from a registered medical practitioner to the effect that the person's condition arising from the personal injury has stabilised and that it is likely that there is impairment resulting from the personal injury; or 
(b)
Fifty-two weeks have expired since the date of the personal injury and the Corporation has received a certificate from a registered medical practitioner to the effect that, despite the fact that the person's condition arising from the personal injury has not yet stabilised, it is likely that there is impairment resulting from the personal injury, — 
whichever first occurs. 
(4)
The assessment of a person's entitlement to the independence allowance shall be carried out in accordance with section 54A of this Act and if, and only if, the entitlement is established by such an assessment, it shall be payable in accordance with subsection (7) of this section. 
 
(7)
The following provisions apply in relation to payment of an independence allowance 
(a)
Except where section 54A (5) of this Act applies on the reassessment of a person's whole-person impairment, the date on and from which the independence allowance is payable is the date on which the person to whom it is payable lodged a claim for cover in respect of the personal injury from which the impairment results. 
54A. Assessment and reassessment — 
(1)
For the purposes of section 54 of this Act, a person's whole-person impairment shall be assessed in accordance with regulations made under this Act. 
(6)
An assessment of a person's whole-person impairment under this section shall not include as impairment any impairment that does not result from personal injury that is covered by this Act or that does not result from personal injury by accident in respect of which a claim has been accepted under the Accident Compensation Act 1972 or the Accident Compensation Act 1982 
(7)
If any person who has received a payment under section 119 of the Accident Compensation Act 1972 or section 78 of the Accident Compensation Act 1982 is assessed for the purposes of establishment an entitlement to the independence allowance, the percentage or percentages of permanent loss or impairment of bodily function upon which any payment or payments under section 119 of the Accident Compensation Act 1972 or section 78 of the Accident Compensation Act 1982 were based shall be deducted from the person's impairment as assessed under this section. 
(8)
Every assessment and reassessment of a person's impairment under this section shall be undertaken by or on behalf of the Corporation and at its expense. ”
The new Regulations to which the new sections referred were the Accident Rehabilitation and Compensation Insurance (Independence Allowance Assessment and Rates of Payment) Regulations 1997 (SR1997/85) which provides for assessments to be carried out by assessors using the American Medical Association Guide to the Evaluation of Permanent Impairment (4th edition). 
Mr Barnett, leading counsel for ARCIC, submitted that Beattie DCJ was in error in reaching the decision that he did, having regard to the provisions of the Acts Interpretation Act 1924 s 20(e)(iii) and (g) which read: 
“20 (e)
The repeal of an Act or the revocation of a bylaw, rule, or regulation at any time shall not affect — 
(iii)
Any right, interest, or title already acquired, accrued, or established or any remedy or proceeding in respect thereof; 
(g)
Any enactment, notwithstanding the repeal thereof, shall continue and be in force for the purpose of continuing and perfecting under such repealed enactment any act, matter, or thing, or any proceedings commenced or in progress thereunder, if there be no substituted enactments adapted to the completion thereof. ”
Mr Barnett pointed out that, if the approach adopted by the District Court were correct, a claimant for an independence allowance would be left without remedy had s 54 simply been repealed without substitution or that there would be different results for otherwise identical claimants according to whether their review decision was issued on 30 June 1997 or the following day or where the argument preceded the coming into force of the substitute ss 54 and 54A but the decision was delivered afterwards. 
The legal consequences of repeal and substitution of an amendment are not without difficulty and there were aspects of that topic and of the way in which s 20 (e)(iii) and other statutory provisions may impact on Ms Wikeepa's position which were not, no doubt because of the way in which the case developed, intensively explored by counsel Ms Wikeepa was, entirely understandably, unable to assist. 
In the first place, what amounts to a “right” under s 20(e)(iii) is by no means clear In what would appear to be the most detailed judicial consideration of the section, it has been held that Parliament could not be expected to have used the word “right” with Hohfeldian precision and that it should be given a broad meaning (Wellington Diocesan Board of Trustees v Wairarapa Market Buildings Ltd [1974] 2 NZLR 562, 571) but the distinction between a “right … already acquired” is shown by the authorities to be a fine one. The learned author of Prof Burrows: Statute Law in New Zealand (2nd ed (1999) p 376-377) has collected a useful compendium of all the cases which have decided whether rights were acquired or not. (See also Thornton: Laws NZ: Statutes para 80 pp 75-77). It is unnecessary and would be superfluous to consider them all. It is sufficient for present purposes to adopt, with respect, the observations of Tipping J in Dental Council of New Zealand v Bell [1992] 1 NZLR 438 where the question was as to the correct procedure for a complaint against a dentist when the conduct on which complaint was founded occurred when the Dental Act 1963 was in force but the complaint was made once the Dental Act 1988 had come into effect Holding that the disciplinary provisions of the later Act were intended by Parliament to apply to events which occurred before its enactment both in procedural and in substantive terms, the learned Judge held (at 443): 
“The essence of an accrued right in this context is that something must have happened to give the person claiming the right the ability to prosecute the same to judgment. Although the right need not have matured into formal legal relief the facts entitling the person concerned to relief must have happened before the repeal in such a form that the right, although not having matured into judgment or relief, can nevertheless be descried as inchoate or contingent. ”
By contrast, all the cases collected by Burrows (ibid.) which have been held to fall outside s 20 (e)(iii) are ones where a further event must occur before the right could be said to have been acquired. 
Further, as Cooke J (as he then was) put it in Wellington Diocesan Board of Trustees (at 571) where a person has a hope or an expectation but no right that a discretionary decision would be made in his or her favour 
“An application for a purely discretionary benefit should not be treated, for the purpose of s 20(e)(iii), as giving even an inchoate or contingent right to such a benefit. ”
Reverting to the facts of this case, the original s 54 provided that any person was “entitled” to receive an independence allowance subject only to their having cover under the 1992 Act and having more than 10% disability as a result of personal injury. By the time the substituted ss 54 and 54A came into force on 1 July 1997, Ms Wikeepa's entitlement had crystallised into the award to her on 21 March 1997 of an independence allowance from 10 January 1997 with the only matter still outstanding being her review as to whether it was to apply from that date or the date of her injury. Her right at that date had, in terms of the authorities, plainly been acquired and was thus not affected by the repeal of the original s 54. 
However, as counsel stressed the differences in the assessment procedures prescribed by the original s 54 and the substituted sections, a further point requires consideration. It is that the authorities demonstrate that actions to enforce rights preserved by s 20(e)(iii) may on occasion be required to conform to new procedures As the learned author of Burrows(op.cit p 378) puts it: 
“Paragraph (e) makes it clear that if a right is preserved under it, proceedings may be taken after the repeal to enforce that right. Just as Court proceedings may be taken, so may administrative steps towards enforcement. Thus a council can take steps to enforce a rate levied under legislation since repealed, and a contribution for road words validly required to be done before the repeal. However, while the possessor of the right may take proceedings after the repeal to enforce it, he or she is bound by any changes in procedure enacted by the new legislation. As we have seen, statutes altering rules of procedure are normally construed retrospectively to apply to proceedings already begun. ”
The reference in that the last sentence is to a passage from Langan, Maxwell on the Interpretation of Statutes (12th ed (1969) 218, 222) which is cited in Burrows (at 362) but which, for present purposes, may be extended 
“The rule (against retrospective construction) has been applied chiefly in cases in which the statute in question, if it operated retrospectively, would prejudicially affect vested rights or the legality of past transactions, or impair contracts, or would impose new duties or attach new disabilities in respect of past transactions … The presumption … has no application to enactments which affect only the procedure and practice of the Courts. No person has a vested right in any course of procedure, but only the right of prosecution or defence in the manner prescribed for the time being.The fuller citation reads (215-225): 
It is a fundamental rule of English law that no statute shall be construed to have a retrospective operation unless such a construction appears very clearly in the terms of the Act, or arises by necessary and distinct implication. …  
If, however, the language or the dominant intention of the enactment so demands, the Act must be construed so as to have a retrospective operation, for ‘the rule against the retrospective effect of statutes is not a rigid or inflexible rule but is one to be applied always in the light of the language of the statute and the subject-matter with which the statute is dealing.’ … [Carson v Carson [1964] 1 WLR 511, 517]. 
The rule under discussion has been applied chiefly in cases in which the statute in question, if it operated retrospectively, would prejudicially affect vested rights or the legality of past transactions, or would impair contracts, or would impose new duties or attach new disabilities in respect of past transactions. …  
In general, when the substantive law is altered during the pendency of an action, the rights of the parties are decided according to the law as it existed when the action was begun, unless the new statute shows a clear intention to vary such rights. …  
The presumption against retrospective constructions has no application to enactments which affect only the procedure and practice of the courts. No person has a vested right in any course of procedure, but only the right of prosecution or defence in the manner prescribed for the time being, by or for the court in which he sues, and if an Act of Parliament alters that mode of procedure, he can only proceed according to the altered mode. …  
The rule against retrospective operation is a presumption only, and as such it ‘may be overcome, not only by express words in the Act but also by circumstances sufficiently strong to displace it.’ … [Sunshine Porcelain Potteries Pty Ltd v Nash [1961] AC 927, 938] ”
The effect of those passages is, with respect, encapsulated in the judgment of Lord Denning in Attorney-General v Vernazza [1960] AC 965 where Mr Vernazza appealed an order that, as a vexatious litigant, he should be debarred from instituting fresh Court proceedings and the Attorney-General had asked the Court of Appeal to vary the order to also debar him from continuing any proceedings already issued, such an amendment only being sanctioned by an amending statute passed between the hearings in the High Court and the Court of Appeal The House of Lords held that the Court of Appeal had jurisdiction so to vary the order because if the terms of the amending Act were assumed to be retrospective they were procedural and provided a new remedy but did not alter substantive rights Lord Denning's formulation of the principle is as follows (at 978): 
“ … in the ordinary way the Court of Appeal cannot take into account a statute which has been passed in the interval since the case was decided at first instance, because the rights of litigants are generally to be determined according to the law in force at the date of the earlier proceedings, see In re A Debtor (No. 490 of 1935) [[1936] Ch 237], New Brunswick Railway Co v British and French Trust Corporation Ltd [[1939] AC 1]. But it is different when the statute is retrospective either because it contains clear words to that effect or because it deals with matters of procedure only, for then Parliament has shown an intention that the Act should operate on pending proceedings, and the Court of Appeal are entitled to give effect to this retrospective intent as well as a court of first instance, see Quilter v Mapleson [9 QBD 672] and Stovin v Fairbrass [(1919) 88 LJKB 1004] ”
Those passages make it clear that if there has been an alteration since the right originally accrued in the Court procedure by which a right preserved by s 20(e)(iii) is being enforced, the means by which that right is enforced must follow the new Court procedures and not the old. Here, there is no suggestion that the review procedure has changed. It is only the assessment procedure which has been altered. There is no basis for inferring that Parliament necessarily intended to alter the rights which Ms Wikeepa had already acquired. The presumption against retrospective construction does not apply because the 1996 amendment does not affect the procedure of the Courts but only the assessment procedure. In those circumstances, the alteration in the assessment procedure had no effect on the circumstances of Ms Wikeepa's claim. Her entitlement to the independence allowance was not affected by the repeal of the original s 54 because of the provisions of s 20(e)(iii) and the effect of the authorities discussed 
For completeness, a number of other matters require to be addressed even though all but the first were not the subject of submissions by counsel. 
The first is any impact which s 20(g), earlier recounted, may have on the appeal. 
Leaving aside at this juncture the concluding words relating to “substituted enactment”, it would appear that the remaining words of s 20(g) might, on their face, have required Ms Wikeepa's review and appeal to be determined in accordance with the original s 54. The learned author of Burrows(op.cit at p379) refers to Ewart v England [1993] 3 NZLR 489 where proceedings for maintenance arrears commenced under the Family Proceedings Act 1980 were held to be able to continue even after the Child Support Act 1991 came into force as the new provisions did not come within the final words of s 20(g) and to Allison v Kealy [1968] NZLR 958 and Spiers v Piako County [1961] NZLR 69 which held that an application for a specified departure and for the right of the Minister of Works to become a party to proceedings following notification were to be dealt with in accordance with the original and not the amending statute. However, the learned author goes on to say that the last words of the paragraph are important and that (ibid.) “if the new legislation substitutes provisions adapted to the completion of what has been done, those new provisions must be used”. However, in the earlier of the two authorities cited on which that observations relies, Whiting v Archer [1964] NZLR 742, 744 there were provisions in the repealed Act as to the manner of dealing with appeals which were not reproduced in the substituted statute but the substituted statute contained a provision about appeals “made but not determined at the commencement of this Act” T A Gresson J accordingly held that appeals awaiting determination after the substituted statute came into force should be dealt with under it “and that the substituted provisions of the new Act, which are adapted to the completion of the appeals, replace the corresponding sections” in the earlier statute. In Amev Life Assurance Co Ltd v Dixon-McIver [1993] 1 NZLR 733 one of the questions was the impact on an application for legal aid of the repeal of the Legal Aid Act 1969 by the Legal Services Act 1991 Because the provisions of the two Act as to entitlement to legal aid were held to be similar, Greig J took the view (at 737) that the terms of the latter statute were “substituted enactments adapated to the completion” of the matter and accordingly held that it made no difference under which Act the question was decided. 
In Ms Wikeepa's case, this Court takes the view that s 20(g) is inapplicable because what was being continued and perfected and what was the subject of proceedings commenced or in progress as at 1 July 1997 was her exercise of her rights of review and appeal. Those rights were unaffected by the coming into force of the amendment on 1 July 1997 even though the procedure for assessment for an independence allowance changed after that date. 
A similar result must be reached in relation to the Acts Interpretation Act 1924 s 22 which provides that the “expiration” of an Act is not to affect judicial proceedings previously commenced and requires such proceedings to be continued as if the Act remained in force. “Expiration” has been held to include repeal (Ewart v England(supra)) but s 22 does not contain the qualification in s 20(g) concerning substituted enactments As far as Ms Wikeepa is concerned, s 22 must also be held to apply to the review and appeal process but not to the assessment procedure 

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