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Recovery of Damages under 1971, 1930, 1912 Acts

Pre-1 December 1988 cases

The 1930 Act applied to employees of the Commonwealth from the date of its proclamation on 10 November 1930 until 31 August 1971. However, members of the Australian Defence Force were not covered by the provisions of that Act until 3 January 1949. [1]

The 1971 Act applied from 1 September 1971 until 30 November 1988 to all Commonwealth employees (as well as full-time and part-time members of the ADF and Cadets). The SRC Act has applied similarly since 1 December 1988.

Guidance on 1971 Act Cases

The Safety, Rehabilitation and Compensation Act 1988 (SRCA), maintains the application of the provisions of the Commonwealth Employees (Compensation) Act 1971 (the 1971 Act) for those cases involving pre-1988 injuries.

Under the 1971 Act, compensation recovery occurs in much the same way as under the SRCA.

However, under the 1971 Act, compensation recovery does not operate for life, it simply requires repayment of the offset amount. (s99 of the 1971 Act).

Under the 1971 Act, DVA’s liability to pay any compensation to a person under the Act for a particular injury stops where that person receives compensation for that injury from another source. However, unlike other Acts, DVA’s liability to pay compensation resumes when the client can demonstrate with receipts (or similar documentary evidence) that all of the amount awarded by the courts/other compensation scheme etc. has been disbursed on injury-related expenses (i.e. medical treatment, aids and appliances, lost wages etc.) that would have been paid or reimbursed under the 1971 Act

This principle operates to allow DVA to pay for treatment costs at such time as the client can show that have disbursed their compensation on injury-related expenses.

In practice, some 30 years after the 1971 Act ceased to be the modern compensation legislation, it would be very difficult for a person who attempts to claim compensation based on an injury for which a 1971 recovery process was implemented to provide the required evidence to re-ignite their compensation and treatment eligibility for that injury.

Damages awards involving contributory negligence on the part of the employee

Special arrangements applied in cases where it was found by a Court in awarding damages that there had been contributory negligence on the part of the claimant for damages. In such cases, it is common for a Court to reduce the amount of the damages award which would otherwise have been payable in proportion to the degree of negligence attributed to the employee's contribution to the cause of the accident.

For example, a Court may have found that an employee should be awarded a total of $250,000 in damages for the effects of an accident and consequent injury to the employee. However, the Court may also have found that the employee was forty per cent negligent (i.e. 40 per cent responsible for the accident) and that the amount of damages payable to the employee should accordingly be reduced to $150,000 ($250,000 minus 40 per cent).

Assuming that an amount of say $20,000 had been paid in compensation benefits prior to the date of payment of the damages, the Commonwealth would, in such a situation, be entitled to be repaid $12,000 (60 per cent of $20,000) and the employee would be entitled to retain $8,000 (40 per cent of the compensation paid prior to that date).

Similarly, any compensation entitlements which the employee may have after the date of payment of the damages award would be reduced by 60 per cent (i.e. the employee is entitled to receive 40 per cent of the amount of compensation payable) until the nett amount of the damages award received by the claimant is offset. When the amounts which were/are actually paid or payable to the employee (60 per cent of the total amount of compensation otherwise payable) reaches the amount of damages actually received (60 per cent of the total or $150,000 in the example above), then he/she is entitled to receive the full amount of any further compensation benefits which may thereafter be payable.

 

[1] Cadets were not covered by the provisions of the 1930 Act at all – any claims for 'compensation' by or on behalf of Cadets at that time were considered on an ex-gratia (Act-of-Grace) basis.