Scottish Court of Session Decisions

Messrs Beath & Kay, engineers and iron-founders, Dundee, presented a note of suspension against Richard Ness, engineer there, in which they sought to suspend a charge at the instance of the respondent for payment of certain sums alleged to be due to the respondent as compensation under the Workmen's Compensation Act 1897, and expenses, conform to interlocutor dated 19th March 1902.

The following narrative is taken from the opinion of the Lord Ordinary ( Pearson):—“In this case the complainers, who are ironfounders in Dundee, seek to suspend a charge for payment of certain sums of money alleged to be due to one of their workmen as compensation under the Workmen's Compensation Act 1897.

“The accident happened on 27th September 1901, and resulted in the loss of the respondent's left eye. The application for compensation was presented in the Sheriff Court at Dundee on 10th January 1902. Proof was taken on 21st February, and the Sheriff's award was given on 19th March. It bears that the respondent's wages prior to the accident were 34s. a-week, and that he was entitled to compensation at 17s. a week for two weeks in October 1901, and since 15th February 1902, until the further orders of Court. No payment of compensation under that award has yet been made, but the complainers have tendered to the respondent a sum which he says is much less than is due to him.

The dispute arises from the fact that since the accident the respondent has for considerable periods, both before and since the date of the award, been working in the complainers' employment and drawing his full wage of 34s. These periods of full wages were, as I understand, from the end of October 1901 until 15th February 1902; from 26th February to 6th April 1902; and from 21st April until the end of October 1902. With these exceptions, which are considerable, he had, at the date of the charge, been off work since the accident.

The complainers say that he was off work, not as the result of the accident, but through slackness of trade. This, however, is not admitted by the respondent, and the complainers have made their tender on the footing that they are responsible for compensation at 17s. a-week during the whole time the respondent was off work since the date of the award; but that they are not bound to pay him any compensation for the period when he was earning full wages.

There was originally a question between the parties as to an item of liability arising before the award was issued. The Sheriff-Substitute in his award of 19th March found compensation due from 15th February till the further orders of Court. But he is said to have done so in ignorance that after the proof was led the respondent returned to work, and had been working at a full wage for three weeks prior to the issuing of the award. This difficulty, however, is got over by the respondent having in the charge deducted the amount of compensation effeiring to those three weeks.

The complainers' position is, that for the periods during which full wages have been paid to the respondent no compensation is payable, as the statute provides expressly for ‘a weekly payment during the incapacity,’ and the earning of full wages demonstrates that the incapacity no longer exists. They accordingly tender, in addition to the expenses decerned for in the award, the sum of 17s. a-week during the time when he was not working.”

No steps had been taken by the employers to have it declared that the workman's incapacity had ceased, or to have the weekly payments decerned for reviewed. No report from a medical man as to the workman's condition had been obtained.

There was no express agreement between the parties to hold the payments of full wages as superseding the claim for compensation to any extent.

A correspondence between the parties' law-agents was produced. After an unsuccessful attempt to settle disputes by payment of a capital sum the workman's agents wrote on 20th May 1902 asking payment of the compensation accrued to date, and of the expenses decerned for. On 4th June 1902 they wrote as follows—“Referring to what passed at Court to-day, we beg to state that if your clients pay to our client compensation at the rate of 17s. per week for the periods during which he has been out of work, together with the expenses decerned for, he will accept such payment in full of his claims for compensation, and expenses to date, leaving it to the Sheriff to fix a nominal compensation until further orders of Court… . This letter to you is written without prejudice to our client's rights and pleas, and is not to be founded on.”

The employers had applied to the Sheriff-Substitute to state a case for appeal, and on his refusal to do so presented a note to the Second Division to have him ordained to do so, but this note was refused by the Court.

On 18th December 1902 the workman's agents registered a certified copy of the Sheriff-Substitute's interlocutor of 19th March in the Books of Council and Session

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for preservation and execution, and the charge complained of was given to the employers in virtue of a warrant upon the extract registered certified copy interlocutor. The employers thereupon brought the present suspension.

The complainers pleaded—“(1) The complainers having paid or satisfied the greater portion of the sums charged for, the charge should be suspended as craved. (3) The respondent having, by receiving wages from the complainers as condescended on, discharged his right to the greater part of the compensation charged for, and quoad ultra the complainers having tendered payment of all sums due by them, the charge should be suspended. (4) The respondent being, in the circumstances, barred from insisting in his claim for compensation, the charge given by him therefor ought to be suspended.”

The respondent pleaded—“(4) The charge complained of having proceeded upon a formal and valid decree which has never been obtempered, and having been duly executed, suspension should be refused, with expenses. (5) The complainers having failed to take the steps provided by the said Workmen's Compensation Act to obtain a revision of the Sheriff's award of compensation, the suspension ought to be refused.”

On 3rd November 1903 the Lord Ordinary pronounced the following interlocutor:—“Repels the reasons of suspension: Finds the charge orderly proceeded; and decerns”

Opinion.—[ After the narrative quoted supra]—“It is no doubt contrary to the fundamental principle of the Act that a workman should be entitled to compensation except during incapacity, partial or total. That is the basis of the liability. But when the incapacity has been affirmed in an award, the Act prescribes very carefully how the recovery of capacity may be established. It lays no duty on the workman to keep the employer informed as to his state of health. It is for the employer to be vigilant in that matter.

In the first place, he may require the workman to submit himself for examination by a medical man provided and paid by the employer. If the workman objects, or if he is dissatisfied with the result, he may submit himself to one of the ‘appointed’ medical men whose certificate is to be conclusive evidence of the workman's condition. If parties cannot agree, the weekly payment may be reviewed by the Sheriff at the request of either party. The parties may, of course, come to an agreement, and doubtless they very frequently do so. But if they do not agree, the award subsists as the rule of payment until it is reviewed at the request of either party.

Here the incapacity which was affirmed in the Sheriff's award of 19th March has neither been reported on by a medical man nor reviewed by the Sheriff-Substitute. The only other possible mode by which the right to the weekly payment can be affected is by agreement of parties.

Now, no express agreement is alleged. The ground of suspension is variously stated in the complainers' pleas-in-law as payment or satisfaction, discharge, and bar. But I think the complainers' real ground of suspension here must be an implied agreement, to be inferred from facts and circumstances to the effect that the right to the weekly payments of compensation was to be suspended when and so long as the respondent was doing full work for full wages. Convalescence, or the receipt of full wages, certainly does not of itself operate to discharge, or even to suspend, the right to continued compensation under an award. But where full wages are in fact earned, and are paid to the workman by the same employer who is liable in the compensation, it would be easy to aver, and comparatively easy to prove, that while the one was paid and received, it was agreed that the other should be suspended. This would the more easily be inferred where the payments of compensation, which are in their nature weekly payments, were not demanded at all during the wage-earning period.

I do not, however, find any such agreement averred upon this record, which sets out the bare facts and dates as to the employment and the wages earned. It may be contrary to the fundamental idea of the Act that compensation should be due for a period during which full wages were earned. But where none of the statutory modes of review has been adopted it would, in my opinion, be still more clearly against the spirit of the Act to hold that the efficacy of an award is impaired or suspended by anything short of the agreement of parties, express or necessarily implied. There is no averment that the payments were in fact given and received on the footing now contended for by the complainers, and it does not appear to me that the facts averred raise any such necessary implication. Perhaps the reason why no specific averment of an agreement is made is that the facts are inconsistent with any such agreement. The correspondence which is produced, and which was referred to in the discussion, is confined to the parties' law-agents. We do not know from any other source how the parties themselves viewed the matter. The letters show that parties were at first attempting to get over a difficulty arising on the Sheriff-Substitute's award by lodging a joint-minute, but they could not agree upon it. After an unsuccessful attempt to settle disputes by payment of a capital sum, the respondent's agents wrote on 20th May, ‘Please let us have payment of the compensation accrued to date, and of the expenses decerned for.’ Now, at this date the respondent was in fact earning a full wage with the complainers, and had been doing so ever since the Sheriff-Substitute's award of 19th March, with the exception of the fortnight from 6th to 21st April. That letter is therefore quite inconsistent with the notion that the wages were being accepted by the respondent as superseding the claim for compensation.

Again, on 4th June his agents wrote making an offer which ought to have ended the matter. But it expressly stated

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that it is made ‘without prejudice to our client's rights and pleas, and is not to be founded on;’ and as the offer does not appear to have been entertained by the complainers the matter remained quite open. Accordingly, even if the bare facts and dates were such as to warrant an inference of discharge or satisfaction, I should hold upon the correspondence that the inference is in this particular case excluded.”

The complainers reclaimed, and argued—The claim for compensation only arose when the accident prevented the workman earning wages. When a workman was earning the wages he received before the accident there was nothing to compensate. The right to compensation lasted only during the period of incapacity. The decree subsisted no doubt till steps were taken in accordance with the Act to bring it to a termination, but it could be acted on only while the workman was not earning wages at all or earning less than he formerly earned by reason of the accident. By accepting employment at full wages after the accident the workman had impliedly agreed to discharge the master's liability for compensation during the period of such employment. The acceptance of such employment on the part of the workman might not have put an end to the decree, but the complainers while paying him full wages had paid the sum due him under the decree during the subsistence of the employment. The sums so paid should be deducted from the amount due, and the charge should therefore be suspended.

Argued for the respondents—He had obtained decree in general terms for payment of 17s. a-week till the further orders of the Court. At any time the Sheriff-Substitute could be called on to review this payment. The complainers had their remedy under the statute, and as long as they did not take the statutory remedy, but allowed the decree to stand, they had no right to complain. There had been no agreement, express or implied, that the terms of the decree should be altered. No such agreement was averred on record, and the correspondence showed that the agent for the respondent was, even when the respondent was working with the complainers, demanding payment of the amount to which his client was entitled under the statute. The 34s. a-week had not been paid under the decree, but had been earned by the respondent, and the mere fact that the injured workman was earning money did not bring the decree to an end. The respondent had lost the sight of an eye and was entitled to compensation, as his general earning capacity had been diminished— Fraser v. Great North of Scotland Railway Company, June 11, 1901, 3 F. 908, 38 S.L.R. 653.

At advising—