Claiming further compensation after finalisation of a damages claim – is it really a clear-cut case of ‘double dipping’?
The Queensland Court of Appeal recently considered whether WorkCover Queensland was entitled to be reimbursed compensation paid to a deceased worker’s spouse under sections 196 and 197 of the Workers’ Compensation and Rehabilitation Act 2003 (WCRA).
- The decision considers whether s119 of the WCRA operates to preclude a worker (or the spouse of a worker in this instance) from claiming additional damages following the settlement of a claim for damages and the signing of a Deed of Release.
The deceased worker (the worker) unfortunately passed away as a result of an asbestos-related condition contracted during the course of his employment. In 2018, prior to his death, the worker commenced proceedings in the District Court of Queensland, claiming damages for personal injuries. Before the proceedings could be heard, the worker passed away in July 2018.
On 12 December 2018, the worker’s widow (the widow) settled the worker’s claim for damages for the sum of $130,000. Before payment to the widow was made, the Court made an order for her to be substituted as the plaintiff in proceedings, as executor of the estate pursuant to s77 of the Succession Act 1981. In January 2019, the widow applied to WorkCover Queensland seeking statutory compensation under s201A of the WCRA, which provides for the payment of compensation in circumstances for the death of a worker who dies of an ‘injury’ for the purposes of the WCRA. The section applies where a worker leaves no dependants but is survived by a spouse, or next of kin within the meaning of the WCRA.
In February 2019, WorkCover Queensland paid $71,348.70 to the widow’s solicitor’s trust account pursuant to sections 195 and 196 of the WCRA. Payment of the $130,000 settlement funds was also received by the widow (through her solicitors) as executor of the worker’s estate.
In July 2019, WorkCover Queensland commenced proceedings, by an originating application, claiming that it was entitled to be reimbursed the statutory compensation, either as money it had paid as a mistake, or as money which was entitled to under s207B(2) of the WCRA.
The decision at first instance
The application was heard at first instance by Everson DCJ in the District Court at Brisbane.
On considering the application, His Honour found that although s119 of the WCRA does operate to preclude double dipping, it did not apply in the circumstances before the Court because:
- The cause of action in respect of the recovery of common law damages related only to the personal injury sustained by the worker, and did not contemplate the recovery of compensation under the WCRA.
- The payment of compensation (namely for funeral expenses and compensation to the estate) was an entirely separate consideration to the common law damages paid, and was not compensation that would have been recoverable by the worker, or the widow, in their action against the employer.
- As such, the concept of ‘double dipping’ did not arise in this case.
His Honour subsequently dismissed WorkCover Queensland’s application.
The decision on appeal
There were two primary issues for the Court of Appeal to consider:
- Whether settlement of the damages claim extinguished all other entitlements to compensation under the WCRA, whether by the worker or any other person, such as his spouse; and
- If entitlement to compensation remained following the settlement, whether the Deed of Release could operate so that this entitlement was extinguished.
It was argued by WorkCover Queensland that s119 of the WCRA operates to preclude a claimant under the WCRA to ‘double dip’, referable to damages paid under the common law and statutory compensation.
The Court of Appeal dismissed the appeal, finding that:
- Judgment or settlement for damages payable to a worker, whether deceased or alive, in respect of rights in his/her lifetime are separate and distinct from claims brought after the worker’s death. Therefore, the right to compensation is not extinguished by judgment or settlement.
- Section 119 of the WCRA, which precludes further compensation being paid after settlement is reached, had no operation in the circumstances because:
- Although damages were paid to the widow as a result of the worker’s personal injuries, that the widow was the substituted plaintiff in the proceedings and received common law damages from WorkCover Queensland was ‘merely facilitative’.
- In that regard, the Court determined that the damages recovered by the widow were essentially the same as those that would have been claimed by the worker had he remained alive and reached a settlement. The widow’s substitution as plaintiff as executor of the estate ‘did not affect the nature of the entitlement to damages’ which was the basis for that proceeding, namely an entitlement to be compensated for loss and damage suffered by (the worker) in his lifetime.
- As such, the entitlement to compensation under sections 195 and 196 of the WCRA and the settlement paid to the widow were not in relation to the same injury. The widow’s claim for statutory compensation under the WCRA was a separate right.
- The widow had a separate right to compensation as a non-dependant spouse as a result of the death of the worker pursuant to s201A of the WCRA.
In respect of the Deed of Release, the Court of Appeal noted the widow was not a party to the Release, and it therefore did not operate to settle any entitlement to damages which she sought under the WCRA following the worker’s death.
Consequently, WorkCover Queensland's application was dismissed on appeal.
Implications for you
The decision highlights that even in circumstances where settlement is reached in respect of a common law damages claim, statutory compensation will still be recoverable under the provisions of the WCRA if pursued in respect of a different ‘injury’.
This article was written by George Rafter, a Solicitor in our Insurance & Health Team.