Employers Mutual Limited v Heise

HER HONOUR: Julie Heise is a former police officer who was discharged from the New South Wales Police Service in 2015 on medical grounds.

In April 2017, Ms Heise lodged a worker’s compensation claim with Employers Mutual Limited claiming permanent impairment on the grounds of psychological injury. That claim has never been determined.

A request for further and better particulars of the claim was made by the insurer on 1 May 2017 and responded to by Ms Heise’s solicitor the same day. Also on that day, the insurer sent a letter enclosing authorities directed to three nominated treatment providers and asking Ms Heise's solicitor to arrange for her to sign and return those authorities. There was further correspondence over the following months concerning the insurer's attempts to arrange an Independent Medical Examination assessment, the substance of the dispute being whether Ms Heise should have to travel to Sydney for that purpose or whether the insurer should arrange for her attendance upon a psychiatrist in Newcastle, closer to where she lives.

On 6 October 2017, the insurer chased up the authorities permitting access to the records of the three treatment providers. The letter stated:

Again responding on the same day, Ms Heise’s solicitor noted (with respect, correctly):

A further exchange followed in respect of the authorities sought by the insurer, including a request that they be re-sent. Ultimately, in early February 2018, the insurer followed up the request for provision of those authorities, repeating the previously corrected assertion that, until those authorities were provided, Ms Heise had failed to provide all relevant particulars of her claim.

Ultimately, the authorities were signed and provided to the insurer on 16 March 2018. According to the insurer's evidence, they were then "served" on the relevant doctors on 23 March 2018.

There was no further progress in the determination of the claim. On 7 June 2018, Ms Heise's solicitor sent the first in a series of plaintive requests asking, "whether your client proposes to make a determination of our client's claim?" That was followed up the following day with an email in the following terms: "Let me know when you know what you know...you know.” On 29 June 2018, the solicitor inquired, "What can I tell my client??".

On 10 July, he wrote, "Can we expect a s 74 notice or offer, please?" Evidently regretting the need to resort to the use of such polite language, on 16 July 2018, he wrote:

A further follow up was sent on 18 July 2018, inquiring when Ms Heise could expect a determination of her claim.

Finally, the insurer responded on 18 July 2018 in the following terms:

There is in fact a statutory time frame imposed on insurers for the determination of claims. Unsurprisingly, however, Ms Heise evidently determined at that point to have the dispute resolved by commencing proceedings and on 25 July 2018 an application was filed for that purpose. At the same time, in respect of the events I have recited, Ms Heise determined to commence a private prosecution alleging that the insurer was in breach of the provision of the Workers Injury Management and Workers Compensation Act 1998 (NSW) (“WIMA”) imposing the time limit to which I have referred.

To that end, on 30 October 2018, Ms Heise (or a solicitor acting for her) attended the registry of the Local Court and had a court attendance notice issued against Employers Mutual Limited alleging breach of s 283(1) of the WIMA. That section provides:

The registrar signed the court attendance notice (as required in the case of a private prosecution, as opposed to a prosecution commenced by a police officer or public officer) and accepted it for filing.

The matter is listed before the Local Court tomorrow, 29 November 2018. In those circumstances, with a measure of expedition which must have seemed unfamiliar to Ms Heise, Employers Mutual Limited approached the duty judge, Fagan J, last Tuesday, 20 November 2018, for leave to file in court a summons seeking prerogative relief in respect of the registrar's decision and short service of the summons. The summons filed in court relevantly sought the following relief:

In making that application, the insurer was appropriately mindful of the undesirability of fragmenting the criminal process, acknowledging authorities to that effect. However, it was submitted before Fagan J that it was necessary for this Court to adjudicate upon the issue, since the proceedings in the Local Court were a nullity and the insurer could not submit to the jurisdiction of that Court, even for the purpose of asking to have the proceeding dismissed.

Separately, it was submitted that there is an important public issue concerning the entitlement of a worker (it might be noted that the right of any citizen would be the same) to bring a private prosecution against an insurer under the relevant legislation. Acknowledging that it is required to act in accordance with the requirements of a model litigant, the insurer was content to accommodate Ms Heise's counsel so as to have the matter heard on a final basis six days after the summons was filed, being Monday of this week. So it came about that the summons was made returnable before me on Monday as duty judge. The matter was heard on Monday and further hearing was required today, in circumstances to which I shall return.

I have concluded that the summons must be dismissed, for the following reasons.

The application proceeded on a misapprehension as to the nature of criminal proceedings. The authority to decide whether a person is guilty or not guilty of a summary offence reposes in the Courts, not police officers or public officers. There is a mechanism for truncating that process but, contrary to the understanding expressed in the submissions on behalf of the insurer, that mechanism does not remove the entitlement of an accused person to have a criminal matter determined by the Court.

Proceedings for an offence can be commenced in a court by the issue of a court attendance notice. That is made plain by s 172 of the Criminal Procedure Act 1986 (NSW). Section 174 of the Act provides for the commencement of private prosecutions, as follows:

It is plain from the terms of s 174 that the entitlement of a person other than a police officer or a public officer to commence proceedings in a court is subject to that person having authority to commence proceedings for the offence in question, either under s 14 of the Criminal Procedure Act or under any other law that may make provision to that effect.

Section 14 of the Criminal Procedure Act provides:

The plaintiff's argument was that Ms Heise had no authority to commence criminal proceedings in the circumstances of this case (and accordingly the registrar had no authority to sign the court attendance notice) because, first, the authority which regulates the industry, the State Insurance Regulatory Authority (SIRA), is the exclusive prosecutor of offences; and, secondly, because the offence for which Ms Heise seeks to prosecute the insurer, s 283, is a “penalty notice offence” and only an authorised officer is able to issue a penalty notice in respect of such an offence.

The submissions provided to this Court on behalf of Ms Heise helpfully identified a number of premises of the insurer's argument that are not disputed by Ms Heise. In particular, it was not disputed that s 283 is a penalty notice offence; that only an authorised officer may issue a penalty notice (and that Ms Heise is not an authorised officer); that s 246 of the WIMA provides the power to issue a penalty notice and that Ms Heise has no capacity under the legislation to issue a penalty notice.

However, it does not follow from the acceptance of those premises that the alternative method of prosecuting, that is, by commencing criminal proceedings in a court by a court attendance notice, is foreclosed. There is every indication that it is not.

First, as submitted on behalf of Ms Heise, the right to commence a prosecution as a common informer is an important common law right and its exclusion would have to be expressed in clear terms. It is not. On the contrary, s 245(5) of the WIMA provides:

Secondly, the proposition that there is a bifurcation in the ways in which criminal proceedings can be commenced (between, on the one hand, the issue of a penalty notice and, on the other, the issue of a court attendance notice, each being a path to the same end) is one which finds support in the provisions on which I was addressed at the hearing.

The first such indication is that s 283 itself has a maximum penalty of 50 penalty units, which calculates to an amount of $5,500. The penalty notice provisions permit an authorised officer only to issue a penalty notice for $500. On the plaintiff's argument, no insurer could ever be penalised for an offence against s 283 for any more than $500, with the result that the prescribed maximum penalty would have no work to do.

The second indication in support of a bifurcated approach is s 245 of WIMA, which provides:

Unsurprisingly, the section contemplates that offences under the Act will be dealt with by a court. Further, it is to be noted that subsection (2) limits the penalty that can be imposed by the Local Court to 200 penalty units whereas the maximum penalty that may be imposed in proceedings in the District Court is the maximum penalty provided in respect of the offence. The section thus contemplates a hierarchy of prosecutions even within the Court system.

The insurer submits that the offence referred to in the court attendance notice, being an offence contrary to s 283(1), is to be dealt with exclusively by penalty notice. Ms Heise submitted that is wrong and that the relevant provisions do not exclude the capacity to proceed by the commencement of proceedings by court attendance notice for the offence. Specifically, Ms Heise noted that there is no mandatory expression in the statute itself to the effect that the offence must be dealt with by way of penalty notice. I accept Ms Heise’s submission.

The insurer further submitted that, despite the mandatory terms of the WIMA and clause 71 of the Workers Compensation Regulation 2016 (NSW), the registrar nonetheless signed the court attendance notice to issue criminal proceedings in circumstances where Ms Heise was not an authorised officer and, further, where the court attendance notice process is expressly prohibited by the WIMA, and the regulation. Ms Heise submitted that that submission was also wrong, there being nothing in the relevant legislation that expressly prohibits the issue of a court attendance notice. Again, I agree. In particular, s 245(5) to which I have already referred indicates otherwise.

A central aspect of the plaintiff's submissions focused on the role of SIRA and, as the argument was developed, led the insurer to submit (of necessity in support of its central premise) that, in the case of a penalty notice offence, not even that Authority can prosecute a breach of the Act by having a court attendance notice issued. Since the submission concerned the functions of the Authority, I considered it appropriate to afford the Authority an opportunity to be heard.

Following some difficulty identifying relevant contact details, the Authority was provided, I think only yesterday morning, with a request from the Court to appear, if possible, today, if it wished to be heard. On that extremely short notice, Mr Frommer sought leave today to appear as amicus curiae to address the Court on behalf of the Authority on the limited issue identified. He provided helpful and succinct submissions, in short supporting the contention on behalf of Ms Heise that the Authority does have power to prosecute an offence either by issuing a court attendance notice or by a member of staff of the Authority, as an authorised officer within the meaning of the Act, issuing a penalty notice under cl 71 of the regulation.

Mr Frommer submitted that, in very short terms, that must follow from the provisions of s 246(5) of the 1998 Act, which provides:

Mr Frommer submitted that it is extremely difficult to see what the intended effect of that subsection might be if it is not to make clear that the penalty notice procedure is not an exclusive procedure for the prosecution of penalty notice offences. I accept that submission.

Finally, I should note that Mr Baran, who appears for the insurer, sought to establish some support for the insurer's argument from two decisions, Tabcorp Holdings v Fitzsimons [2007] NSWSC 836 and Sasterawan v Morris (2007) 69 NSWLR 547; [2007] NSWCCA 185. I do not think either of those authorities assists the argument. Reliance was placed in particular on Sasterawan at [22] where Basten JA, with whom Grove and Hidden JJ agreed at [39] and [40] respectively, said the following in respect of s 14 of the Criminal Procedure Act:

The purpose of relying on that decision was to support the contention that, for some offences, authority to prosecute is restricted. However, it is important to note that the example his Honour gave, namely, s 338 of the Crimes Act 1900 (NSW), being the offence of perjury, is one in respect of which there is a very clear restriction on authority to prosecute, the section being one which provides in subsection (1) a person is not to be prosecuted for perjury except by the Director of Public Prosecutions or at the direction of the Attorney General, “or by any other person with leave of the judicial officer who constituted the judicial tribunal before which the perjury is alleged to have been committed.” If that is an example of a case in which there is a restriction on authority to prosecute, it is clear that the present case is not.

The plaintiff's submissions also placed considerable emphasis on the role of SIRA as the authority responsible for ensuring compliance with workers compensation legislation. Mr Baran took the Court in detail to the relevant provisions of the legislation and submitted on that basis and by reference to the well-known principles of construction stated in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 that a purposive construction of the legislation would lead to the conclusion that only the Authority has power or authority to prosecute for an offence under the Act.

As already indicated, however, the right of a common informer to commence a private prosecution is an important common law right. And even having regard to those matters, I do not think there is anything in the language of the relevant statutes to suggest any intention to exclude that right. The circumstances recited at the outset of this judgment provide some illustration as to the importance of having an entitlement to bring a private prosecution alongside the prosecuting authority of a statutory body such as SIRA.

For those reasons, I was not persuaded that the registrar lacked jurisdiction to sign the court attendance notice and, accordingly, it follows that the summons must be dismissed.