PARTIES:					THE NOMINAL INSURER

						v

						DESMOND JOHN THOMAS

TITLE OF COURT:			SUPREME COURT OF THE NORTHERN TERRITORY

JURISDICTION:				SUPREME COURT OF THE NORTHERN TERRITORY EXERCISING TERRITORY JURISDICTION

FILE NO:					No. 107 of 1994

DELIVERED:				Darwin, 15 May 1995 

HEARING DATES:				6 December 1994

JUDGMENT OF:				Kearney J

CATCHWORDS:

STATUTES  -  Interpretation - plain and unambiguous language
	- legislature's intention clear from context - approach to construction

	Work Health Act (NT), s167(1) and (2)

	Cooper Brookes (Wollongong) Pty Ltd v The Commissioner of Taxation (1980-81) 147 CLR 297, applied
	K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 60 ALR 569, applied

WORDS AND PHRASES - "has been wound up" - whether, in context,
	connotes a company in the course of liquidation, or the completion of the liquidation

	Work Health Act (NT), ss84(3)(d)-(f), 167(2)(a)

REPRESENTATION:

	Counsel:

	Appellant:				T.J. Riley QC
	Respondent:				J.S. Brown

	Solicitor:

	Appellant:				Elston & Gilchrist
	Respondent:				Cridlands

JUDGMENT CATEGORY:				C

JUDGMENT ID NUMBER:				kea95029.DIS

NUMBER OF PAGES:				41

kea95029.DIS

IN THE SUPREME COURT
OF THE NORTHERN TERRITORY
OF AUSTRALIA
AT DARWIN

No. 107 of 1994

						IN THE MATTER OF the Work Health Act

						AND IN THE MATTER of an appeal from a decision of the Work Health Court at Darwin

						BETWEEN:

						THE NOMINAL INSURER
							Appellant

						AND:

						DESMOND JOHN THOMAS
							Respondent

CORAM:   KEARNEY J

	REASONS FOR JUDGMENT

	(Delivered 15 May 1995)

		The appeal
		On 3 June 1994 the Work Health Court (herein "the Court") granted the respondent's application to consolidate his claims nos.9402489 (Thomas v The Nominal Insurer) and 9118764 (Thomas v Groote Eylandt Mining Company Pty Ltd (herein "GEMCO")), and dismissed the appellant's application to stay or dismiss the respondent's claim no.9402489 for compensation under the Work Health Act (herein "the Act").  By Notice of Appeal of 16 June (amended on 6 December) the appellant appealed against that decision.  On 6 December the appeal was argued before me; after hearing submissions I allowed the appeal for reasons to be published in due course.  I now publish those reasons.  It is convenient first to set out the statutory provisions the construction of which determined the appeal.

		The relevant statutory provisions 
		The appeal primarily involved the construction of s167 of the Act.  Section 167 took its present form on 1 January 1992, as part of the extensive amendments to the Act made by the Work Health Amendment Act (No.3) 1991.  Section 167(1) provides that where an employer under an established liability to pay compensation defaults in payment, a claim may be made directly against the Nominal Insurer provided the five preconditions (a)-(e) below are met, viz:-
	167.	"(1)	- - - where -

		 (a)	a claim has been made against an employer that the employer is liable to pay compensation;

		 (b)	in relation to the claim -

			(i)	the employer has accepted liability for the compensation under section 85;

			(ii)	the employer is, by virtue of section 87, deemed to have accepted liability for the compensation;

			(iii) the Court has ordered or determined that
				the employer pay compensation; or

			(iv)	a memorandum of an agreement to pay compensation has been recorded under section 108;

		 (c)	the liability of the employer to pay the compensation is not covered in full by a policy or policies of insurance or indemnity obtained in accordance with this Act;

		 (d)	the employer defaults in payment of any amount of compensation referred to in paragraph (b); and

		 (e)	a principal contractor, within the meaning of section 127, is not liable under that section to pay the compensation.

		 the person entitled to the compensation may make a
		 claim for compensation against the Nominal
		 Insurer." (emphasis mine)
Section 167(2) allows claims to be made directly against the Nominal Insurer in certain circumstances where a worker cannot effectively bring his compensation claim against his employer or its approved insurer in accordance with the Act, viz:-

	167	"(2)	Where -

		(a)	the employer -

			(i)	who employed a worker at the time the worker sustained a compensable injury; 
				- - - 

		is dead, cannot be located or, in the case of a company, has been wound up; and 

		 (b)	the approved insurer of that employer cannot be identified,

	 	a person claiming to be entitled to compensation may make a claim for compensation against the Nominal Insurer."  (emphasis mine)
It can be seen that s167(1) applies where an injured worker has already established his entitlement to compensation, but has not been paid it, or part of it; and that s167(2) applies where he is prevented for the specified reasons from effectively instituting his claim for compensation in the manner prescribed by the Act.  The difference is significant, since his Worship reasoned from provisions in s167(1) to support his construction of s167(2)(a); see pp17-18.

  		The claims
		The respondent instituted claim no.9118764 against GEMCO on 20 September 1991 on the basis that that company was a "principal contractor"; that is, his claim was founded on s127 of the Act, which provides as far as relevant:-
		"(1)  Where a person (in this section referred to as the "principal contractor") [here GEMCO], in the course of or for the purpose of his trade or business, contracts with another person  (in this section referred to as "the contractor") [here Value Engineering Australasia Pty. Ltd. (in liq.) - herein "Value"] for the execution by or under the contractor of the whole or a part of any work undertaken by the principal contractor, the principal contractor shall be liable to pay to a worker employed by the contractor in the execution of the work [here the respondent] compensation under this Act which he would have been liable to pay if that worker had been immediately employed by him.

		- - - 

		(3)   Where the principal contractor is liable to pay compensation under this section, he shall be entitled to be indemnified by any person who would have been liable to pay compensation to the worker independently of this section.

		(4)   Nothing in this section shall be construed as preventing a worker recovering compensation from the contractor instead of the principal contractor.

		(5)   Nothing in subsection (3) shall be construed as requiring the Nominal Insurer established by section 150 to indemnify a principal contractor under this Act." (emphasis mine)

It can be seen from pars3, 4 and 6-8 of the Statement of Claim at pp8-10 that claim no.9118764 is made on the basis that the respondent was employed by Value which had contracted with GEMCO to execute some of GEMCO's work, in the course of which the respondent was injured.  It seems to be common ground that claim no.9118764 is a quite separate claim, alternative to claim no.9402489, and has no bearing on the claim against the appellant.  
		In claim no.9402489 against the appellant made on 3 February 1994 the respondent contends that he sustained injury while "in the course of his employment with [Value] or, in the alternative, with Gemco." 

		The grounds of appeal
		An appeal under the Act is limited to "a question of law"; see s116(1).  In its amended Notice of Appeal the appellant relies on two grounds of appeal, which in essence are:-

		1.	In deciding that the respondent was entitled to claim against the appellant in claim no.9402489 under s167(2) of the Act, the Court erred in law in holding, with reference to Value, that the words 'has been wound up' in s167(2) are capable of meaning 'has been placed into liquidation', whether or not the winding up had been finalised.

		2.	The Court erred in law in not dismissing the respondent's claim no.9402489 against the appellant, since no basis for the claim was properly pleaded, in that the requirements of s167(1) were not pleaded by the respondent in his Statement of Claim, viz:-

			(a)	Insofar as the respondent sought to recover against the appellant under s167(1) of the Act pursuant to his claim no. 9402489 naming Value as his employer, the respondent had not alleged -

				(i)	in accordance with s167(1)(b), that Value's liability to pay compensation to the applicant had been determined;

				(ii)	in accordance with s167(1)(d), that Value defaulted 'in payment of any amount of compensation'; and

				(iii) in accordance with s167(1)(e), 		that a principal contractor [GEMCO] 	was not liable under s127 to pay the 	compensation.

			(b)	Insofar as the respondent sought to recover against the appellant under s167(1) of the Act pursuant to his claim no.9402489 naming GEMCO as his alternative employer he had not alleged -

				(i)	in accordance with s167(1)(b), that GEMCO's liability to pay compensation to the applicant had been determined;

				(ii) in accordance with s167(1)(c), that
					GEMCO was not covered by appropriate insurance;

				(iii) in accordance with s167(1)(d), that
					GEMCO had defaulted in payment of any amount of compensation; and

				(iv)	in accordance with s167(1)(e), that a principal contractor [presumably Value] was not liable to pay the compensation.

As to ground 2(b) which relates to claim no.9402489, I observe that it emerged that the respondent did not in fact seek to recover against the appellant should it be held that GEMCO was his employer when he was injured; he is probably debarred from doing so, under s127(5) of the Act.  However, the appellant had to deal with claim no.9402489, as framed; hence ground 2(b).  The appellant sought that the proceedings no.9402489 brought against it be stayed or dismissed.

		The decision on the appeal
After hearing the parties' submissions on 6 December I ruled as follows:-

			"I uphold all of the grounds of appeal relied on in the amended notice of appeal dated 6 December 1994.  That is to say, - - -  as to ground [1 on p5]: I hold that the Work Health Court erred in law in finding that the words, 'has been wound up', are capable of meaning 'has been placed into liquidation',  whether - - - or not that winding-up has been finalised - - -.  I consider that those words, 'has been wound up' [in s167(2)(a)] have a clear meaning and they mean exactly what they say, and that is, that the winding-up has been completed.  That clearly is not the case here [as regards Value].  As a result of upholding that ground I hold, contrary to the decision of the Work Health Court, that the respondent Desmond John Thomas was not entitled to make the claim against the Nominal Insurer which he made by application 9402489 dated 31 January 1994.

			I uphold both grounds 2(a) and 2(b) [see pp5-6] relied on by the appellant in relation to the second decision which is attacked in the appeal, that [the respondent] was not required to discharge the requirements of section 167(1)(a)-(e) inclusive prior to making a claim against the Nominal Insurer.

			It follows that I [further] consider that his Worship erred in failing to dismiss the claim (no.9402489) instituted against the Nominal Insurer on 31 January 1994, because no basis for that claim had been properly pleaded in that application.  In lieu of his Worship's order of 3 June 1994 in which he declined to dismiss the claim, the proper order is that the claim stand dismissed; I so order.

			- - - 

			- - - I [also] set aside [Work Health Court] orders numbers 1 and 2 - - -. [These were orders consolidating claims nos.9118764 and 9402489, and adjourning them to a date to be fixed for a preliminary conference to settle orders to bring the respondent's claim to finalization].

			- - - 

			- - - the appellant - - - should have its costs of this appeal and of arguing the issue in the Work Health Court.  I certify for senior counsel at the hearing of the appeal."
It can be seen that in the result claim no.9402489 was dismissed, and claim no.9118764 against GEMCO (which was not attacked) remains on foot.   I turn to what gave rise to the respondent's claims.

		The general background to the claims
		The relevant factual background to the claims is set out in pars1-23 of the respondent's Statement of Claim of 3 February 1994 against the appellant in claim no.9402489, viz:- 
		"1.	The [appellant] is a body corporate established by section 150 of the Work Health Act and is capable of being sued.

		2.	On 19 June 1990 the [respondent, a draftsman resident in Queensland] entered into an agreement with [Value] titled "Independent Consulting Contractors Details of Engagement" ("the Agreement").

		3.	The Agreement provided for [Value, a Queensland company] to arrange for the [respondent] to provide his professional services to clients of [Value] from time to time as such opportunities arose.

		4.	The Agreement provided, inter alia, by paragraph 8 that under no circumstances shall the [respondent] be deemed to be an employee of [Value] and that the [respondent] shall have no claim on [Value] in respect of claims under Workers Compensation legislation, except in exceptional circumstances.

		5.	The [respondent] says that the relationship between him and [Value] is to be determined by reference to the provisions of the Work Health Act and not by the terms [by] which he and [Value] describe themselves in the Agreement."

I observe as to pars4-5 that on the appeal it was common ground between Mr Brown of counsel for the respondent  and Mr Riley QC of senior counsel for the appellant that a person cannot contract out of any obligations in fact imposed under the Act.  The Statement of Claim continued:-
		"6.	On 18 June 1990 [Value] was engaged by the Groote Eylandt Mining Company Pty Ltd ("Gemco") to supply to Gemco the [respondent's] services for three months with an option of a further three months at Gemco's premises at Alyangula, Groote Eylandt - - -  ("the Arrangement").
This Arrangement explains why claim no.9118764 is based on s127 of the Act; see pp4-5.  It is common ground that under the Arrangement the respondent was described as an "independent contractor", Gemco paid Value for supplying the respondent's services, Value paid the respondent, and the respondent paid his own tax.  This indicates in common law terms that the respondent was in an "independent contractor" relationship.  However, in 1990 s58 of the Act (repealed on 1 January 1992) provided that for the purposes of the Act a "worker" did not include an "independent contractor", an expression defined in s3(1) in terms of a person who held a current certificate of exemption under s58.  The respondent never held such a certificate.  A "worker" was defined generally in s3(1) of the Act in terms of "a natural person who under a contract or agreement of any kind - - - performs work or a service of any kind for another person".  It can be seen that the respondent was arguably a "worker" for the purposes of the Act.  The Statement of Claim continued:-

		"7.	On 22 June 1990 the [respondent], pursuant to the Arrangement attended at Gemco's premises at Alyangula - - - and commenced work.

		8.	On 18 August 1990, in the course of his employment with [Value] or, in the alternative, with Gemco, the [respondent] sustained an injury:

					PARTICULARS OF INJURY

			The [respondent] slipped in a shower and fell suffering thoracic back pain causing a minor wedge compression factor in the [respondent's] thoracic spine.  As a result the [respondent] is likely to have ongoing chronic thoracic pain of an intermittent nature.

		9.	Shortly after 18 August 1990 the [respondent] reported the injury to - - - Gemco.

		10.	On 22 September 1990 as a result of pain caused by the injury the [respondent] arranged for his employment with Gemco to terminate and departed Alyangula on 22 September 1990 and travelled to Brisbane, Queensland." (emphasis mine)
I observe from pars6 and 10 that the date of the respondent's departure, 22 September 1990, appeared to coincide with the expiration of the 3-months period for which his services were to be available to GEMCO under the Arrangement.  The Statement of Claim continued:-

		"11.	From 22 September 1990 the [respondent] sought medical advice for the injury, in Brisbane, and commenced treatment.

		12.	On 24 July 1991 the [respondent] completed a Workers Compensation claim form No. 14959 ("the claim form").

		13.	On 6 August 1991 [that is, about a year after the injury] Gemco was served with the claim form together with a medical certificate of Dr McCormack dated 24 July 1991 and bearing No.64751.

		14.	By letter dated 13 August 1991 Gemco wrote to Cridlands, the [respondent's] solicitors, informing Cridlands of Gemco's view that the [respondent] was not employed by Gemco, and returned the claim form.

		15.	On 27 August 1991 Gemco's insurer wrote to the [respondent's] solicitors rejecting the [respondent's] claim.

		16.	On 20 September 1991 the [respondent] issued an application out of the Work Health Court at Darwin bearing Plaint No.9118764 claiming compensation against Gemco." (emphasis mine)
I note that in this alternative claim no.9118764 of 20 September 1991 the respondent alleged, inter alia, that GEMCO was his employer when he was injured on 18 August 1990; see pp4-5, and par6 on pp8-9.  The respondent did not institute claim no.9402489 against the appellant until some 2½ years later, on 3 February 1994; in that claim he names Value as his employer or, alternatively, GEMCO.  The Statement of Claim continued:-
		"17.	On 21 May 1992 [Value] was wound up by members' voluntary winding up and Brian Wilson of Arthur Anderson, Sydney, was appointed liquidator.

		18.	By letter dated 22 June 1993 the [respondent's] solicitors wrote to Mr Wilson enclosing a copy of the claim form [no.14959] and medical certificate No.64751 and stated in the letter that the letter and enclosures [were] served by way of personal service upon Mr Wilson pursuant to section 220(5) of the Corporations Law.

		19.	On 20 July 1993 a servant or agent of the liquidator informed the [respondent's] solicitors that [Value] had in place a policy of Workers Compensation Insurance in Queensland, and not for claims in the Northern Territory pursuant to the Work Health Act 1986.

		20.	By letter dated 15 December 1993 the [respondent's] solicitors forwarded to - - - the [appellant] a Workers Compensation claim form No. 14959  dated 24 July 1991 and medical certificate dated 24 July 1991 bearing No.64751, together with other documents.

		21.	By letter dated 23 December 1993 Elston & Gilchrist, solicitors for the [appellant], wrote to the [respondent's] solicitors, inter alia, acknowledging receipt of the [respondent's] solicitors' letter to the [appellant] dated 15 December 1993 and enclosures.

		21.(sic, 21A)  As at the date of filing of this
			Application [that is, 3 February 1994] the [appellant] has neither accepted, rejected or deferred the claim described in paragraph 20.

		22.	The [respondent] claims the [appellant] is deemed to have accepted liability for his claim.

		23.	The [respondent] says that he is incapacitated for work from time to time either partially or totally, and claims: 

			(i)	Weekly payments of compensation;

			(ii)	Additional payments for late weekly payments pursuant to section 89 of the Work Health Act;

			(iii)	Medical, surgical and related expenses;

			(iv)	Interest;

			(v)	Costs."(emphasis mine)
		The appellant in its Answer admitted the allegation in par1 of the Statement of Claim, denied those in pars2-19 inclusive and in relation to pars20-23 stated:-

		"3.	The [appellant] admits that it received a letter dated 15th December 1993 enclosing a claim form and medical certificate numbered and dated as pleaded.

		4.	The [appellant] admits that on 23rd December 1993 its solicitors, Messrs. Elston & Gilchrist, wrote to the [respondent's] solicitors. - - -

		5.	The [appellant] denies the allegation contained in paragraph [21A and] says that by letter dated 23rd December 1993, through its solicitors, the [appellant] rejected liability for the claim made.

		6.	The [appellant] denies the allegation contained in paragraph 22 of the Statement of Claim.

		7.	The [appellant] denies the [respondent] is incapacitated or entitled to the relief sought in paragraph 23 of the Statement of Claim for the following reasons:-

			(1)	The liability of the [respondent's] employer has not been established in accordance with the Act;

			(2)	The [respondent's] employer is covered in full by a policy of insurance taken out in accordance with the Act [and] a principal [contractor], within the meaning of Section 127, is liable under that Section to pay the compensation, namely Groote Eylandt Mining Company Pty Ltd;

			(3)	The [respondent's] employer has not defaulted in payment of any amount of compensation;

			(4)	The [respondent's] employer has not been wound up."
The reference in par7 to "the [respondent's] employer" is clearly a reference to Value, although it seems in relation to par7(2) that it is common ground that Value did not in fact hold "a policy of insurance taken out in accordance with" s126(1) of the Act. 
		It can be seen that to ground its claim against the appellant pursuant to s167(2) in proceedings no.9402489 the respondent essentially relied on the fact that his alleged employer Value had been placed in liquidation, as establishing that Value "has been wound up,"; contrast par17 on p11 and par7(4) on p13.  I turn next to the applications before his Worship.

		The proceedings in the Court on 20 May 1994
		Two items of relief were sought in relation to the 2 claims on 20 May 1994.

		(1)	The respondent's application to consolidate the claims
		Mr Brown applied orally to consolidate the 2 claims.  In support, he submitted that it was desirable and convenient to join all the parties in one proceeding so that all the issues which might arise in the claims could be conveniently resolved: for example, whether the respondent was a 'worker' in terms of the definition of that term in s3(1) of the Act as it stood in 1990; if so, who was his 'employer' (as defined in s3(1)) at the relevant time, in light of s3(4) as it then was and s127(1); if the respondent was employed by Value, what was the effect of s57(2) of the Act on his entitlement to compensation; and whether the criteria in s167(1) & (2) of the Act had been met (thereby enabling the respondent to claim directly against the appellant in claim no.9402489).  He submitted that the overall benefits of joinder would clearly outweigh any prejudice the appellant might thereby suffer.  His Worship noted that the following appeared to be what the respondent essentially sought -
		
		"- - - the [respondent] wishes to assert in the one action [no.9402489] that he was - - - employed by Value and suffered an injury in the course of his employment, and that Value, or the Nominal Insurer in the place of Value, needs to [compensate] him; or, alternatively, that he was employed by Gemco and he suffered an injury in the course of his employment with Gemco and Gemco needs to [compensate] him."

		(2)	The appellant's application to dismiss claim no.9402489
		Mr Davies then of counsel for the appellant opposed consolidation of the claims and applied orally to stay or dismiss claim no.9402489.  He submitted that the respondent's pleadings and the facts he had thus far placed before the Court, did not enable him as yet to claim against the appellant.  That is, they did not disclose a present right to proceed against the appellant pursuant to s167 of the Act, in that:-
		(a)	the pleadings (in particular par8 of the Statement of Claim at pp9-10) and the supporting affidavit of Mr Roussos of 19 May 1994 alleged that the respondent was employed either by GEMCO or Value; no claim could arise against the appellant at this time unless Value had been found to have been his employer, since it was not suggested that GEMCO did not hold insurance under s126, and in any event s127(5) barred access to the appellant if GEMCO were the employer;
		(b)	the respondent had not satisfied the five preconditions necessary to a claim against the appellant under s167(1); and 
		(c)	the respondent had not satisfied a precondition in ss167(2)(a) of the Act to a claim against the appellant under s167(2) - that his employer Value "has been wound up". 
		Opposing the application to stay or dismiss claim no.9402489, Mr Brown submitted that since the Act was beneficial legislation the Court should construe s167 purposively, and in particular should take a "purposive approach" to the construction of the phrase "in the case of a company, has been wound up" in s167(2)(a).  The words "has been wound up" should be construed as "has commenced to be wound up".  He submitted that Value was to all intents and purposes "moribund".  
		Mr Davies in response submitted that the scheme of the Act clearly evinced a legislative intent to make the Nominal Insurer the "insurer of last resort".  Accordingly, a "purposive" construction of the phrase in s167(2)(a) had to take account of that legislative intent and give it weight.
		The Court reserved, and delivered its decision on 3 June 1994.  

		The Court's decision of 3 June 1994
		His Worship first reviewed the purpose and scheme of the Act and considered the various provisions - ss82-85 (especially s84(3)(d)-(f)), 87, 126, 126A, 167 and Schedule 2 - dealing with claims against an employer, and against its insurer if the employer defaulted.  In particular, he noted the similarity in the wording of ss84(3)(d)-(f) and 167(2)(a), and considered ss84(3) and 167(2) should be construed so as to promote the same aim of the Act.  Section 84(3) provides:-
		"(3)   Notwithstanding sections 81 and 82, if a person making a claim for compensation becomes aware that the employer -

		(a)	has not complied or is not likely to comply with subsection (1)(a) or (b);

		(b)	is refusing to receive the claim;

		(c)	cannot be identified;

		(d)	cannot be found;

		(e)	is dead; or

		(f)	is a corporation which has been wound up,

		he may lodge a claim for compensation with the relevant insurer or the Authority."

 His Worship considered that s84(3)(d)-(f) showed that -
		"- - - the aim of the Act where the employer is dead, cannot be found or has been wound up, is to provide a system for the claim to be still made (by lodging it under section 84(3)) and ensuring that the requirements of the Act are not frustrated by the personal circumstances of the employer, with a view to the worker being compensated to the extent he or she is entitled under the Act.

		- - - 

		Once there is a default [by the employer] in the payment of any amount [of compensation] for whatever reason the worker can claim direct against the employer's insurer.  The intention of the Act is to ensure that a worker receives his payments regularly and on time.

		It is in this context that the words "dead, cannot be found or has been wound up" need to be considered.

		- - -  in that context "corporation which has been wound up" in section 84(3) in my view means a corporation which has been placed in liquidation irrespective of whether the winding up has been concluded or whether the corporation has been de-registered or not." (emphasis mine)

He then applied this emphasis on the worker receiving his compensation payments promptly to the construction of s167(2), as follows:-
		"- - - the intention of section 167(2) of the Act is that where an employer is dead, cannot be found or has been wound up and no approved insurer can be identified, - - - the Nominal Insurer is primarily liable to the worker (standing in place of the employer) and it is up to the Nominal Insurer (and not the worker) to pursue the employer if it can.  In any of the stated circumstances it could be anticipated that the worker could be delayed in obtaining an early resolution to his claim and/or unlikely to receive regular and undelayed payments.

		Therefore whether an employer has assets that can be seized, or whether a deceased employer has an estate from which funds might be forthcoming, or whether a company in the process of being wound up might have monies to pay an award, does not prevent the worker from making a claim against the Nominal Insurer.  This view is fortified by the fact that the trigger which enables the worker to claim from the Nominal Insurer under section 167(1)(d) is a default "in payment of any amount of compensation" [for which he is liable].  Therefore, even one default in a weekly payment [of compensation] is sufficient to enable the worker to claim against the Nominal Insurer.   Therefore the clear intention is that the worker receive all entitlements in time and regularly and if [there is] any default the worker does not have to exhaust his remedies against the employer first.  Therefore the legislature has decided to pass the onus and risk of recovering from the employer on to the insurer or the Nominal Insurer and remove this burden from the worker.

		The proper course, in my view, (if the prerequisites in section 167(2) are met) is for the worker to make a claim against the Nominal Insurer, [and] the Nominal Insurer to give notice of a possible claim (to the executor of the deceased employer's estate or the liquidator of the company) under section 172 of the Act.

		In my view it is not for the worker to make a claim against the liquidator of a company and then seek leave to proceed against the company, in circumstances where section 167(2) applies.  Section 471(2) of the Corporations Law [to be treated as in force as regards the winding up of Value - see s1383(5) of the Corporations Law] states:

			"Where an order has been made for the winding up of a company, - - - no action or other civil proceeding may be commenced or proceeded with against the company except -

			(a)	by leave of the Court; and

			(b)	in accordance with such terms as the Court imposes".

		In Ex parte Walker (1982) 6 ACLR 423 Master Lee QC set out 8 principles relevant to granting an application for leave to proceed [under the corresponding s230(3) of the Companies Act 1961 (Qld)].  Two of those principles were:

			"3.     There must be no prejudice to the creditors or to the orderly winding up of the company if the action is allowed to proceed: Re Sydney Formworks Pty Ltd [(in liq.) (1965) NSW R 646]; Re AJ Benjamin Ltd (in liq) and the Companies Act, [(1969) WN (Pt.1)(NSW) 107]. 

			5.      Leave is more likely to be granted where there is an insurance company standing behind the company to pay any judgment which the plaintiff might obtain against it.  If successful, such an action is unlikely to prejudice the creditors or the company:  Re Sydney Formworks Pty Ltd (in liq), supra; Re AJ Benjamin Ltd (in liq), supra; the section is not designed to protect an insurer".

		The Act is at pains to pass the financial burden on to approved insurers and the Nominal Insurer in preference to the worker.  It would, in my view, be contrary to this clear intention to read section 167(2) as requiring the worker (where the winding up of the company had not been completed) to run the risk of having to seek leave to proceed against the company (which leave would be unlikely to be granted where no insurer was standing behind the company, which is always the situation under s167(2)) and then presumably having to be subjected to a further requirement that any judgment would not be enforced without the leave of the Court.

		It would be contrary to the whole emphasis of the Act to require all that to be attended to particularly when, if after all that, an award is not satisfied (which it almost always would not be), the claim would start again against the Nominal Insurer, and any order of the Court would be of no force and effect (s170(1)).

		The intention of the Act is that the worker entitled to compensation should be paid it in the shortest time and that payments should be maintained in regular and ordered payments until liability ceases.

		Thus, even where there is a default in payment by an approved insurer (whether or not the approved insurer has funds available to pay it) under section 167(1) the worker may claim against the Nominal Insurer." (emphasis mine) 
I interpose that s167(1) does not refer in terms to default in payment by an approved insurer.  Section 167(1)(d) refers only to default by an employer.  Section 137(1)-(3) deal with the situation where an approved insurer is unable to make a payment.  His Worship continued:-
		"This shows an intention by the legislature to put a scheme in place whereby whenever there is a problem with a payment the worker has someone else to turn to, so that as far as possible the worker is not out of pocket and he receives his proper entitlements under the Act as and when they fall due.   Thus, although the Nominal Insurer is clearly the insurer of last resort the legislature does not require the worker to pursue every other avenue to the end first. A mere default in payment [by the employer] (s167(1)[d]) is enough to justify a claim being made to the Nominal Insurer.  Therefore, section 167(2) seems to be looking at cases where default in payment (or regular payments) is likely, and so as to avoid unnecessary delay to the worker he is permitted to proceed against the Nominal Insurer direct.

		Mr Davies - - - invites me to read the words "has been wound up" to mean a company where the liquidation has been finalised rather than meaning a company which is in liquidation.  Whilst at first blush the language used may suggest the interpretation being pressed by the Nominal Insurer, in my view that interpretation is contrary to the intention and general aims of the Act as a whole and therefore should be adopted only if there is no other meaning open.  I find that the words are capable of meaning "has been placed into liquidation" whether or not that is by order of the Court or voluntary and whether or not that winding up has been finalised or not.  I further find that this meaning fits in with the purpose of the Act and is the proper interpretation to give effect to the purposes of the Act as a whole.

		On the evidence before me I am satisfied on the balance of probabilities that Value - - - was placed into voluntary liquidation by resolution of its members of 21 May 1991, that Brian J Wilson is the liquidator of the company, that the liquidation has not been completed and that an approved insurer of the company cannot be identified.

		Mr Davies further submits that as section 167(2)(b) requires that "the approved insurer of that employer cannot be identified" it presupposes that there must have been an approved insurer; and therefore, if there never was an approved insurer, section 167(2) has no application.  I cannot agree with that submission.  To give the section such a narrow meaning would be unnecessarily limiting and contrary to the intention of the Act as a whole. 

		I find that section 167(2)(b) applies whether an approved insurer ever existed or not." (emphasis mine)
I interpose to say that I respectfully agree with his Worship's construction of s167(2)(b), for the reasons he states.  His reasons for decision continue:-
		"I therefore find that the worker was entitled to make a claim against the Nominal Insurer under section 167(2), which it did by letter dated 15 December 1993 enclosing a claim form and medical certificate.

		In addition to this action there is also a separate file being action No.9118764, a claim in which the worker is suing GEMCO as a principal [contractor and deemed] employer under section 127.

		It is clear that a fundamental and critical issue to be determined by the Court will be whether at the relevant time the worker was employed by:

			1.	GEMCO;
			2.	Value - - - ; or
			3.	Neither.

		In relation to deciding whether the worker was employed by Value - - -, the Nominal Insurer (in the absence of any approved insurer) stands in the place of the [employer] (s170(2)).  It is desirable that the issue of liability be determined in the one proceeding with both GEMCO and the Nominal Insurer (in place of Value - - -) before the Court.  Only then can the issue be fully and properly aired and a decision by the Court then be binding on all parties.

		It was also pressed upon me that if all the prerequisites of sections 167(1)(a)-(d) were satisfied but a potential liability of an independent contractor existed [under s167(1)(e)] then no claim under section 167(1) could be made against the Nominal Insurer until that liability (if any) had been determined.  I disagree.  If the Nominal Insurer was not a party to the proceeding against the principal contractor [the Gemco proceeding no.9118764] then any decision in that proceeding would not be binding upon the Nominal Insurer anyway.  Further, it would be defeating the aims of the Act and delaying finality if the worker had to pursue an action to a decision stage against any and all possible principal contractors before he could claim against the Nominal Insurer, with the whole claim process to then start from scratch again (s170).  In my view, where the requirements of section 167(1)(a) to (d) are all satisfied, the worker could sue both the principal contractor and the Nominal Insurer in the same proceeding (in the event that the Nominal Insurer denied liability) so that the issue of liability can be fully and finally determined in the one action rather than in two separate actions.

		In my view, section 167(1)(e) means that a claim against the Nominal Insurer may be made [under s167(1)] when [sic, although] there is no finding of liability against a principal contractor.   The worker is entitled to seek to recover compensation from [his] employer instead of the principal contractor (s127(4) and therefore there is nothing to compel the worker from pursuing [sic, to pursue] every possible claim before he can claim against the Nominal Insurer.

		If [s167(1)(e)] had the effect pressed by the Nominal Insurer then in any case where an arguable claim under section 127 existed the Nominal Insurer could not be claimed against until that had been pursued and determined.  I find that that was not the intention.  It would be in the interest of the Nominal Insurer to be represented in any proceeding to determine the liability of a possible principal contractor, and thereby protect its own interest.

		I find that the claim in action No.9402489 against the Nominal Insurer can be made at this time.  Therefore the oral application by the Nominal Insurer to dismiss that action is dismissed.

		Upon the oral application of Mr Brown - - - I order:

		1.	That action No.9402489 be consolidated with action No.9118764.
		2.	I adjourn the now consolidated actions to a date to be fixed by the Registrar for a preliminary conference for consequential and other orders necessary to bring the worker's claim to a finalisation."
		(emphasis mine)

I turn to the appeal against this decision.

		A preliminary submission on appeal

		Mr Brown submitted, in essence, that the factual background to this appeal was not unimportant, because it was the backdrop to the Court's attempt to do justice in the case before it.  He referred, inter alia, to the following three matters to illustrate the respondent's hardship in attempting to ascertain against whom he should claim in the circumstances.
		(1)	The respondent had three potential claim scenarios, given the factual matrix set out in the Statement of Claim in no.9402489 at pp8-12 and the affidavit of Mr Roussos of 19 May 1994.  First, he could claim against GEMCO as his employer, as he had in claim no.9118764.  Second, if he satisfied the criteria in s57(2) of the Act, he could claim against Value as his employer.  I note that he has not claimed against Value in the Court; I consider he should have claimed in Court against Value and GEMCO, in the alternative.  Third, he might not fall within the (former) definition of "worker" in s3(1) of the Act; if so, he would be ineligible to recover compensation under the Act from either Value or GEMCO.
		(2)  Mr Brown submitted that at trial "two threshold issues" would be agitated before the Court:-
		(a)	whether the respondent was a "worker" or an "independent contractor", for the purposes of the Act; and
		(b)	whether the subcontracting provision of the Act, s127(1), applied.

He submitted that:-
		"- - -  as a matter of logic [and practicalities] it would seem that these [2] issues should be litigated at the same time, as the appellant may become liable if those issues are resolved in favour of the respondent."

On the facts I accept that that result may eventually follow if Value is found to be the employer; it is not suggested that the appellant may become liable if GEMCO is found to be the employer.  This issue of who was the respondent's employer, if anyone, should be resolved in a claim brought by the respondent against Value and GEMCO, in the alternative.

		(3)	Before the Court Mr Brown had relied on the affidavit of Mr Roussos to establish, inter alia, that on 21 May 1991 the members of Value had resolved to wind up their company and had appointed a liquidator, and that Value did not have an "approved insurer" in the Territory.  This evidence had not been controverted for the purposes of the application; his Worship had clearly accepted Mr Roussos' affidavit evidence in making the following findings:-

		"On the evidence before me I am satisfied on the balance of probabilities that Value - - - was placed into voluntary liquidation by resolution of its members of 21 May 1991, that Brian J. Wilson is the liquidator of the company, that the liquidation has not been completed and that an approved insurer of the company cannot be identified. (emphasis mine)

I observe that since the "liquidation has not been completed" it cannot be known whether Value can pay any compensation awarded until the claim against it is pressed.

		The submissions on Ground 1 (p5)

		Mr Riley submitted that the Court erred in construing the phrase "has been wound up" in s167(2)(a) of the Act to mean "has been placed into liquidation" rather than "has been liquidated".  The effect of this misconstruction was wrongly to enable the respondent presently to claim directly against the appellant in claim no.9402489 rather than against his employer, Value.  In support, Mr Riley made the following 4 broad submissions:-

		(a)  The Court had reviewed the Act in detail.  It had considered the "approved insurer" provisions s126, ss83 and 84 dealing with service of a claim on an employer and the duties which flowed from that, and determined what the intention of the legislature was in relation thereto; then, because of the similarity in wording between ss84(3)(c)-(f) and s167(2), it had erroneously concluded that the same legislative intention existed in relation to claims against the appellant.  He cited the following part of his Worship's decision which showed this process of reasoning:-

		"- - - the aim of the Act where the employer is dead, cannot be found or has been wound up, is to provide a system for the claim to be still made (by lodging it under section 84(3)), [with the 'relevant' insurer or the Work Health Authority] and [thereby] ensuring that the requirements of the Act are not frustrated by the personal circumstances of the employer, with a view to the worker being compensated to the extent [to which] he or she is entitled under the Act.

		Given that - - - the employer is indemnified by an insurer [as required by s126(1)] and therefore the insurer is directly liable to the worker [under s132(1) and 133] in the event of a default [in payment by the employer found liable] in any amount, the financial circumstances of the employer are irrelevant.  If an employer still existed and had more than sufficient assets to meet an award that would be irrelevant, - - - the approved insurer is obliged to pay (s133) once a claim is made directly against it (s132(1)).  Once there is a default in the payment of any amount for whatever reason the worker can claim direct against the employer's insurer. [I note that under s132(1)(d) it appears the triggering default by the employer must be "of an amount of the compensation for a period exceeding one month".]  The intention of the Act is to ensure that a worker receives his payments regularly and on time.

		It is in this context that the words "dead, cannot be found or has been wound up" [in s84(3)(d)-(f)] need to be considered.

		The fact of death [of a natural person] is all that is needed [in s84(3)(e); cf s167(2)(a)].  It is irrelevant whether there is an executor of the estate or that the estate has not been fully wound up."
I interpose that I agree with this view of s84(3)(e).  In a company the equivalent of the death of a natural person is dissolution.  Whereas winding up an estate follows death, winding up the affairs of a company is the process which leads to dissolution.  His Worship continued:-
		"Likewise it is the fact [in s84(3)(d)] that the employer cannot at the relevant time be found and only that which is relevant [cf. s167(2)(a) "cannot be located"].  It is irrelevant that the employer may be able to be found in the future or that it has assets which might be capable of being seized to answer any judgment that might be made.  Therefore, in that context "corporation which has been wound up" in section 84(3) in my view means a corporation which has been placed in liquidation irrespective of whether the winding up has been concluded or whether the corporation has been de-registered or not." (emphasis mine)
With great respect, I think the passage emphasized is a non sequitur.  A company 'placed in liquidation' remains a company; it is neither 'dead' nor missing and is not 'dead' until dissolved - that is, until the winding-up of its affairs is completed and the statutory requirements thereafter complied with.  His Worship continued:-
		"In my view, section 84(3) is not so much concerned with identifying someone to serve with the claim in place of the employer as it is in ensuring that the claim is lodged with (brought to the attention of) the entity which is ultimately liable to indemnify the employer in respect to the claim by the worker.  The purpose is to ensure (as much as possible) that a decision on liability is made and payments commenced in the shortest possible time (section 85) and that all amounts payable to a worker are made regularly and without delay (sections 85(2), 85(4)(b), 88, 89 and 109).  There is no consideration given in section 84(3) (or elsewhere in the Act) to the claim being served or lodged with anyone (including the personal representative of the employer or the executor of the employer's estate or the beneficiaries under the employer's estate or the liquidator of the employer) apart from the employer, the employer's insurer (section 84(3)) or the Nominal Insurer (section 167).  This view of section 84(3) is reinforced by sections 84(3)(a) and (b) which enables the worker to lodge the claim with the insurer where there is even a likelihood that the employer may not forward the claim to the insurer.

		That being so, the next question is: do the [very similar] words [to those in s84(3)(d)-(f)] where they appear in section 167(2) have the same or a similar meaning as they do in section 84(3)?

		In section 84(3) the words used are "[d] cannot be found, [e] is dead or [f] is a corporation which has been wound up".  In section 167(2) the wording used is: "is dead, cannot be located or, in the case of a company, has been wound up."

		In my view the slight difference in the wording does not change the fact that the phrasing is for all intents and purposes identical.  The difference can be explained by a lack of attention to detail by the draftsman rather than an intention to create two different situations." (emphasis mine) 
		I respectfully agree with the passage last emphasized.  His Worship then proceeded to translate the view he had expressed on the approach to s84(3) to s167, as set out at pp17-20.  Mr Riley rightly accepted that the Act is generally designed to ensure that the worker receives his compensation payments regularly and on time: see Perfect v Northern Territory of Australia (1992) 3 NTJ 596 at 609-610.  However, he submitted that -

		"[The Court] was wrong in importing into [s167(2)] the intention of the legislature to ensure that [the appellant] is there to make payments [of compensation] immediately.

		- - -

		In relation to the [appellant] the worker has to go back and start from 'square one'.  He has to serve the claim, and all previous admissions of liability - - - are set [aside] by section 170[(1)(b)]".

		He submitted that the Act (in particular ss82-4, 167, 170 and 171) instituted a regime whereby an injured worker primarily was required to proceed against his employer.  In limited circumstances - that is, where the employer was not dealing with the claim as required by the Act - the worker was enabled by s84(3) to proceed directly against the 
employer's approved insurer.  As what is commonly termed 'a last resort', the Act provided that the worker could proceed directly against the appellant, but only in the circumstances set out in s167.

		Mr Riley submitted that the circumstances set out in s167 all pointed to a requirement that there be someone at the employer's 'end of the chain' to deal with the worker's claim.  In this case the respondent's alleged employer, a company in liquidation (Value), had a responsible officer available to do so, in the form of its liquidator.  He was the person the respondent should first deal with.  The respondent at this stage had no right to proceed directly against the appellant as he had in claim no.9402489.

		(b)   If the legislature had intended that a worker could claim directly against the appellant under s167(2) when his company-employer had simply been placed into liquidation, it would have expressly so provided, instead of using the words "has been wound up."

		(c)  In effect, the construction his Worship had adopted was that "has been wound up" in s167(2)(a) means "has commenced to be wound up"; this was not the plain meaning of that phrase. His Worship's construction  meant that a claim could be brought against the appellant at a stage earlier than that contemplated by the legislature.

		(d)	Neither in the Corporations Law nor in any of its preceding Companies Acts is the wording "has been wound up" used.  
The procedure under those laws for a members' voluntary winding up is that they decide to wind up the affairs of the company, and appoint a liquidator; he gets in the company's assets and pays its debts.  Section 509(1) of the Corporations Law provides that "as soon as the affairs of the company are fully wound up", the liquidator has "to make up an account showing how the winding up has been conducted", explain it at a meeting of the company's creditors and members, and thereafter lodge a return; s509(5) provides that 3 months thereafter "the company is dissolved." "Winding-up the company" strictly refers to the process of winding up the affairs of the company, though it leads to its dissolution.  Mr Riley submitted that since a winding up is in its nature a process, in s167(2) the phrase "has been wound up" referred to the completion of that process; a claim could be made on the appellant only after the process had been completed.
		In support of these submissions, Mr Riley relied on three authorities.  In Russian and English Bank v Baring Brothers & Co. Ltd (1936) AC 405 Lord Russell of Killowen explained the nature of a winding up, as follows at 433:-

		"The winding-up of a company is not the same thing as the dissolution of a company.  A company is wound up when its affairs are wound up; and its affairs are wound up by getting in such assets as can be got in, and paying therewith such debts as are ascertainable, and disposing of the surplus (if any) to those entitled thereto."

In Re Crust 'N' Crumb Bakers (Wholesale) Pty Ltd (1992) 5 ACSR 70 McPherson SPJ, dealing with winding up orders by a Court, expressed similar views at 72:-

		"Winding up is a process that consists of collecting the assets, realising and reducing them to money, dealing with proofs of creditors by admitting or rejecting them, and distributing the net proceeds, after providing for costs and expenses, to the persons entitled.  It is a process, comparable to an administration in equity, that begins or "starts" with an order of the court.  However, it is not the court order itself that "winds up" the company; the order does no more than direct that the company be wound up, which is then carried into effect by an officer of court, the liquidator, who does the things I have identified in order to liquidate the 
company's assets and wind up its affairs."
In In re Wilkinson Elder's Trustee and Executor Co. Ltd v Wilkinson (No.2) (1924) SASR 156, Poole J put it succinctly at 162 and 164:-

	162.	 "There are under [the Companies Acts] two modes in which a company incorporated under these Acts may be dissolved.  Each must be preceded by a winding-up".  

	164.	"Under the Companies Acts winding-up precedes dissolution - - - and the corporate state of the company remains until it is wound up - - -."

In O'Donovan's "The Law of Company Liquidation", (3rd ed., 1987) the learned author outlines the procedure for winding-up at pp3-6, observing at p6 that -

		"In voluntary  liquidations [as in the case of Value] dissolution follows as a matter of course once the affairs of the company have been fully wound up."

		I consider it is clear that "winding up" is a process the object of which is the termination of the existence of the company, by identifying and disposing of its assets and settling its debts, and dividing any surplus assets among its members.  It is synonymous with "liquidation"; so "has been wound up" means "has been liquidated."  Those words connote the termination of the process, which involves the dissolution of the company under s509 of the Corporations Law; its legal personality is thereby extinguished, the equivalent of a natural "death" - subject always to the Lazarus provision of s571(1). 
		Mr Riley submitted that the construction of "has been wound up" he proposed was consistent with s509 of the Corporations Law, the scheme of the Act, the other categories of employers in s167(2)(a) ("dead" or "cannot be located", in each case there being no longer a responsible officer to take responsibility for proceedings), and the plain words of s167(2).  Accordingly, a claim against the appellant under s167(2) required as a precondition, in the case of a company-employer, that its affairs had been fully wound up.  To interpret s167(2) otherwise, would dramatically alter the appellant's position as "insurer of last resort," with serious repercussions.

		Mr Brown supported his Worship's construction of "has been wound up" in s167(2)(a), on 4 bases.

		(a)	Although the appellant is the "insurer of last resort", one of the purposes of the Act is to ensure that a worker receives "speedy payments of [compensation to which he is] entitled, either from his employer, the employer's approved insurer, or the Nominal Insurer".   In this case -

		"the reality is that Value, on the findings of fact - - - has no authorised insurer and is potentially liable [to pay compensation to the respondent]" (emphasis mine)

I observe that a potential liability to pay compensation is not enough; in terms of s167(2)(a) Value must be established to have been "the employer who employed [the respondent] at the time [the respondent] sustained a compensable injury", and the other preconditions of s167(2)(a) met, before a claim may be made against the appellant. 

		In general, Mr Brown adopted his Worship's reasoning based on the purposes and scheme of the Act, and in particular the analogy he had drawn with the effect of s84(3), which allowed a worker to proceed directly against the employer's approved insurer where the employer was dead, unable to be located, or (in the case of a company) "has been wound up".
		(b)	The purpose of the Act would be defeated if a liquidator of a company had to deal with the claim, even though the liquidator "could handle [the process]".  In support, Mr Brown relied on the Court's observations, viz:-

		"The Act is at pains to pass the financial burden on to approved insurers and the Nominal Insurer in preference to the worker.  It would, in my view, be contrary to this clear intention to read section 167(2) as requiring the worker (where the winding up of the company had not been completed) to run the risk of having to seek leave to proceed against the company (which leave would be unlikely to be granted where no insurer was standing behind the company, which is always the situation under s167(2) and then presumably having to be subjected to a further requirement that any judgment would not be enforced without the leave of the Court.

		It would be contrary to the whole emphasis of the Act to require all that to be attended to particularly when, if after all that, an award is not satisfied (which it almost always would not be) the claim would start again against the Nominal Insurer and any order of the Court would be of no force and effect (s170(1)).

		The intention of the Act is that the worker entitled to compensation should be paid it in the shortest possible time and that payments should be maintained in regular and ordered payments until liability ceases.
		
		Thus, even where there is a default in payment by an approved insurer (whether or not the approved insurer has funds available to pay it) under section 167(1) the worker may claim against the Nominal Insurer.  This shows an intention by the legislature to put a scheme in place whereby whenever there is a problem with a payment the worker has someone else to turn to so that as far as possible the worker is not out of pocket and he receives his proper entitlements under the Act as and when they fall due.  Thus, although the Nominal Insurer is clearly the insurer of last resort the legislature does not require the worker to pursue every other avenue to the end first.  A mere default in payment (s167(1)) is enough to justify a claim being made to the Nominal Insurer.  Therefore, section 167(2) seems to be looking at cases where defaults in payment (or regular payments) is likely, and so as to avoid unnecessary delay to the worker he is permitted to proceed against the Nominal Insurer direct."

		(c)	Mr Brown rightly conceded that the Court's construction of s167(2)(a) (p32) involved "stretching [its plain] language"; however, he submitted, the construction proposed by the appellant (p29) would be "contrary to the intention and the general  aims of the Act as a whole."

		(d)	He submitted that any injustice caused to the appellant by the Court's construction of s167(2)(a) would be ameliorated to some degree by s172(2) of the Act, which preserved the appellant's right to pursue Value to recover any payment of compensation it was required to make to the respondent. 

		In reply, Mr Riley submitted that the necessity for the respondent to apply for leave to proceed against the liquidator of Value, pursuant to s471(2) of the Corporations Law, was not inconsistent with the appellant's construction of s167(2) in that:- 

		"leave would always be granted almost as a matter of course, because behind the company is an insurer, whether it be the approved insurer or, alternatively, the [appellant].  [Consequently,] - - - the company will not at any stage have to pay out [compensation] - - - the primary obligation to pay [compensation] will rest in these circumstances with either the approved insurer or the [appellant] who each in turn have a right of redress from the company in liquidation - - -.  [Consequently, in effect] the granting of leave would be a mere formality - - -."

		The submissions on Ground 2 (pp5-6)
		Mr Riley submitted as follows.  There are 5 mandatory preconditions in s167(1) all of which the respondent has to satisfy before he could institute a claim against the appellant - 

		"Section 167(1) deals with the situation where an employer has had a claim against it, has been found liable, defaults, and there is no insurer to step into the breach."

The Statement of Claim at pp8-12 was defective (and the respondent had not sought to amend it) in that it did not allege, as required by s167(1):-

		(i)		that Value's liability to pay compensation had been established (s167(1)(b));
		(ii)		that Value had defaulted in paying that compensation to the respondent (s167(1)(d)); and
		(iii)	that GEMCO was not a principal contractor liable to pay compensation (s167(1)(e)).

Accordingly, the claim against the appellant could not be sustained, as presently pleaded.  It was incompetent.  Moreover, these deficiencies could not be cured by an order that the pleadings be amended.  For example, as to (i) above, the admitted fact was that Value's liability to pay compensation had not been established, or sought to be established  before the Court; to plead otherwise, the respondent would have had to plead what was manifestly false. 

 		Mr Riley made similar submissions in relation to GEMCO as employer though, as noted at p6, it seems that the respondent does not really intend to claim against the appellant on the basis that GEMCO was his deemed employer.

		Mr Brown submitted as follows:-
		"- - - a fundamental and critical issue - - - to be determined - - - was who [the respondent] was employed by; - - - it seemed from the history of the matter that ultimately the [appellant] would stand in the place of Value - - -.  That flows from his Worship's finding of fact that Value - - - did not have an approved insurer. [I note that it would also require a finding that Value was the respondent's employer].

		So far as Value - - - is concerned, the [appellant] is the 'insurer of last resort'.   There are certain pragmatic considerations which [make it] difficult for the [respondent] to pursue Value - - - .He has got to get leave to proceed, and it may be of no avail anyway.

		The view of the legislation that his Worship took was that it is for the benefit of workers.  The [appellant] has the power to pursue Value, if [Value] has anything at all, because of s172(2)(b); and it is onerous to expect [the respondent] to do it.  For that reason - - - the '91 action against Gemco and the action against the [appellant] were consolidated.

		- - -

		[The Court] speaks of the fundamental and critical issue.  [The Court] indicates it's desirable [that] the issue of liability be determined in one proceeding."

		Conclusions
		The outcome of this appeal depends on the proper construction of s167(1) and (2).  I agree with Mr Brown that they should be given a purposive construction.  As to their construction I respectfully adopt and apply the observations of Mason and Wilson JJ in Cooper Brookes (Wollongong) Pty Limited v The Commissioner of Taxation (1980-81) 147 CLR 297 at 320-321:
		"The fundamental object of statutory construction in every case is to ascertain the legislative intention by reference to the language of the instrument viewed as a whole.  But in performing that task the courts look to the operation of the statute according to its terms and to legitimate aids to construction.

		The rules [of construction], as D.C. Pearce says in 'Statutory Interpretation', p14, are no more than rules of common sense, designed to achieve this object.  They are not rules of law.  If the judge applies the literal rule it is because it gives emphasis to the factor which in the particular case he thinks is decisive.  When he considers that the statute admits of no reasonable alternative construction [to that to which a literal interpretation gives rise] it is because (a) the language is intractable or (b) although the language is not intractable, the operation of the statute, read literally, is not such as to indicate that it could not have been intended by the legislature.

		On the other hand, when the judge labels the operation of the statute as "absurd", "extraordinary", "capricious", "irrational" or "obscure" he assigns a ground for concluding that the legislature could not have intended such an operation and that an alternative [to a literal] interpretation must be preferred.  But the propriety of departing from the literal interpretation is not confined to situations described by these labels.  It extends to any situation in which for good reason the operation of the statute on a literal reading does not conform to the legislative intent as ascertained from the provisions of the statute, including the policy which may be discerned from those provisions.

		Quite obviously questions of degree arise.  If the choice is between two strongly competing interpretations, as we have said, the advantage may lie with that which produces the fairer and more convenient operation so long as it conforms to the legislative intention.  If, however, one interpretation has a powerful advantage in ordinary meaning and grammatical sense, it will only be displaced if its operation is perceived to be unintended." (emphasis mine)

I also bear in mind that it is trite that a legislative provision must be read in its context; see K & S Lake City Freighters Pty Ltd v Gordon & Gotch Ltd (1985) 60 ALR 569 at 514 per Mason J. 

		As to s167(2)(a), I consider it is clear that the phrase "has been wound up" requires that the process of winding up the affairs of the company has been completed, in accordance with the Corporations Law; that is, that the "liquidation has been finalised", in his Worship's phrase (p20).  That is the plain, obvious, literal meaning of the phrase.  Moreover it is a meaning which in terms of Cooper Brookes (supra) "has a powerful advantage in ordinary meaning and grammatical sense", accords with "the legislative intent as ascertained from the provisions of the [Act], including the policy which may be discerned from these provisions" and is an interpretation the operation of which cannot be "perceived to be unintended".  It is not "contrary to the intention and general aims of the Act as a whole", as his Worship put it (p20).  The relevant legislative intent is that the appellant be "the insurer of last resort".  It follows that until a company-employer's affairs have been wound up and it has ceased to be a functioning entity, the usual claim must be served on it - as indeed the respondent did here (par18, p11).  Although the Act must be read purposively, to do so does not affect the construction of "has been wound up", in the sense I have indicated; cf. the provision in s10(4)(1) of the Workers' Compensation Act 1990 (Q'ld) where the relevant words are "has ceased to exist".

		I do not consider that the similarity in the wording of ss84(3)(d)-(f) and 167(2)(a) leads to the conclusions drawn by his Worship at pp17-20.  

		First, I respectfully disagree with his interpretation of the effect of s84(3)(f), set out at p17; I do not consider s84(3)(f) refers to a corporation which has merely been placed into liquidation.  It requires that the winding up has been concluded.  

		Second, the reasoning by analogy from the similar language, in any event, fails to give sufficient weight to the fact that under the Act the appellant is the "insurer of last resort".  Before the appellant can be resorted to, an applicant for compensation must exhaust his other avenues.  In general terms, and contrary to his Worship's conclusion at p21, a worker must pursue "every possible claim [reasonably  open] before he can claim against the Nominal Insurer."  I accept, as his Worship says (p17), that it is the "intention of the Act - - - that a worker receives his payments regularly and on time", but it is also the intention of the Act that the appellant be the worker's last resort to obtain those payments; the fact that a worker may encounter delay in having his claim resolved if his employer-company is in liquidation cannot affect that.  

		His Worship considered (p17) that -
		"- - - whether a company [employer] in the process of being wound up might have monies to pay an award [to its worker] does not prevent the worker from making a claim against the Nominal Insurer."  

In fact, such a right would empty of content the appellant's status as an "insurer of last resort"; some default by the employer must occur, before there can be recourse to the appellant.  

		Third, ss84(3) and 167(2) are in any event directed to recovery from quite different entities, and to reason by analogy from one to the other by similarity of language alone is of doubtful validity.  Sections 167(1) and (2) are directed to different situations (see pp2-4) and the "trigger" (p17) of a default under s167(1)(d) does not support his Worship's fundamental proposition that the intention of the Act that "the worker receive all entitlements in time and regularly" leads to a construction of s167(2)(a) which in fact removes the "last resort" status of the appellant.  
		That "last resort" status is an intrinsic part of the statutory process to ensure that an injured worker receives his entitlements.  I do not consider it is open to conclude from s167(1)(d) that the words "dead, cannot be located or - - - has been wound up" in s167(2)(a) generally embrace "cases where default in payment - - - is likely, and so as to avoid unnecessary delay to the worker he is permitted to proceed against the Nominal Insurer direct", as his Worship put it at p19.  

		It follows that as far as Value is concerned, it is necessary for the respondent to claim against Value through its liquidator (as he did in June 1993 - see par19 on p11) and seek leave to proceed against Value under s1383(5) of the Corporations Law; see p18.  I appreciate the thrust of his Worship's reasoning to the contrary (pp17-19), but it fails in my opinion to give any or sufficient weight to the "last resort" status of the appellant.  The essential difference between our respective interpretations of s167 is that in my opinion it is not the case that the "legislature does not require the worker to pursue every other avenue to the end first [before claiming against the appellant]" (p19).

		I also respectfully though diffidently disagree with his Worship's view at pp21-22 on the effect of s167(1)(e) at p3.  It is one of the preconditions to claiming against the appellant under s167(1) that the non-insured or non-fully-insured (see s167(1)(c)) employer's liability to pay compensation has already been established; see s167(1)(b) at p2. If the factual situation is such that this employer is arguably a contractor within a contractor/principal contractor relationship in terms of s127(1) apropos the work in which the worker was injured, the worker must fail in a claim against the principal contractor under s127(2) before he can claim against the appellant under s167(1).  In such a case, as here, prudence points to his claiming against the contractor and principal contractor in the alternative, in the one claim; here he should have sought to claim against Value as his employer in the alternative, in his claim no.9118764 against GEMCO.  That would prevent "delaying finality", as his Worship put it at p21.  It will be noted from the terms of s127(1) that to successfully claim against GEMCO as principal contractor, the respondent has to prove he was a "worker employed by" Value.  The respondent cannot sue the alleged principal contractor GEMCO and the appellant in the same proceeding because he cannot claim against the appellant under s167(2) unless GEMCO is not liable under s127.

		In short, I accept the submissions of Mr Riley at pp24-29 on Ground 1 and pp34-35 on Ground 2.  Adopting this approach, claim no.9402489 against the appellant is incompetent at this time, and should be dismissed.  It follows that the application to consolidate the 2 claims should be refused.
		These reasons, together with those briefly stated on 6 December (pp6-7), constitute the reasons for allowing the appeal and for the consequential orders made that day.

	_____________________