AN01 Full Federal Court Decision in James

Advisory Note from Rehabilitation & Entitlements Group

No. 1/2010

FULL FEDERAL COURT DECISION IN JAMES

This is an advisory note only.  It is not a Military Rehabilitation and Compensation Commission Guideline or a Departmental Instruction.  The advice is not intended to conflict with the proper application of the Military Rehabilitation and Compensation Act 2004 or the judgements of the Courts.  It may be subject to change as a result of further interpretation by the Courts of the legislation.  Nevertheless it represents a considered view that should be taken into account by all delegates.

Summary

1. The decision in James v Military Rehabilitation and Compensation Commission [2010] FCAFC 95 (James) endorses the operation of Chapter 25 of the Guide to Determining Impairment and Compensation (GARP M).  That Chapter provides for a method of offsetting prior payments of permanent impairment compensation made under the Safety, Rehabilitation and Compensation Act 1988 (SRCA) or disability pension payments under the Veterans' Entitlements Act 1986 (VEA) in determining an amount of compensation payable under the Military Rehabilitation and Compensation Act 2004 (MRCA) in certain circumstances.

Decision

2. The Full Court of the Federal Court was asked to rule on certain assessment aspects of Mr James's case, but of most interest for Military Rehabilitation and Compensation Commission (MRCC) delegates, the Court ruled on certain aspects of the validity and operation of Chapter 25 of GARP M.

a. The appeal in James had questioned whether the legislative authority for establishing the offsetting principles and formulae in Chapter 25 was sound.  The Court ruled that it was and that section 13 of the Military Rehabilitation and Compensation (Consequential and Transitional Provisions) Act 2004 (CTPA) authorised this.

b. The Court found that the introduction of Chapter 25 into GARP M is not beyond the exercise of power conferred by the CTPA, and that the MRCC was not acting beyond its authority in establishing the formulae and methods for offsetting the old SRCA and/or VEA conditions against a MRCA PI assessment.

c. The appellant had argued that section 13 of the CTPA was only for the calculation of offsets related to a person's entitlement to an SRDP safety-net payment under Chapter 4 Part 6 of the MRCA.  This argument was incorrectly based around the construction of s14 of the CTPA and the Court dismissed this aspect of the appeal.

d.The appellant had argued that the operation of Chapter 25 can result in a person receiving no compensation due to the offsets applied from the old injuries, and that this operation would remove their entitlement to pursue common law damages and that this was a removal in rights of the claimant.  The Court dismissed this aspect, as the person affected in this way is no worse off than a person who suffers an injury, which does not result in a compensable level of impairment.

Result

3. It must be emphasised that this decision does not alter the operation of any aspect of the MRCA, the CTPA, or GARP M.  Rather, the decision provides Court endorsement for the current policy and practice being undertaken by MRCC delegates in applying Chapter 25 of GARP M.
4. Delegates should not reference the decision as part of their determinations, however, the endorsement provided by the Court can be used if questions are raised about any offsetting results.

Action

5. No action is required as a result of the James decision.  Delegates should be aware that this decision emphasises the validity of the current policy and procedures being undertaken by MRCC delegates when applying Chapter 25 of GARP M.

{signed}

Adam Luckhurst

National Manager

Rehabilitation & Entitlements Policy Group

9 August 2010