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1917 Supreme(SC) 36
Privy Council
Parmoor, Sumner , Lords Atkinson, Viscount Haldane, Justice Earl Loreburn, JJ.
Australian Alliance Assurance Company -Appellant
Versus
Attorney-General for Queensland and others -Resopndent
Privy Council Appeals Nos. 127 and 128 of 1916
Decided On : 18-06-1917
The court held that "may approve" confers discretionary power on the executive, not a ministerial duty. Furthermore, the plain language of a statute must be enforced even if it renders other provisions practically futile, as courts cannot rewrite legislation to correct perceived legislative errors.
Headnote:(A) Workers Compensation Act, 1916 - Sections 7 and 8 - Approval to carry on accident insurance business - Discretion of the executive - Mandatory state insurance - The power of the executive to approve a company to carry on the business of accident insurance is discretionary, as indicated by the words "may approve" - Such an act is not merely ministerial, and the executive is not subject to court control regarding the refusal to grant approval - The deposit of security is a condition of the grant, but does not create a statutory right to approval. (Paras 3-4)
(B) Statutory Interpretation - Mandatory provisions - Plain meaning of the enactment - Where a statute obligates employers to obtain insurance from a state insurer, this mandatory requirement must be enforced according to its plain words - The court cannot rewrite a statute even if the provision renders private insurance business practically futile or appears to be a legislative accident - The policy of the Act and the novelty of a provision are insufficient grounds for disregarding the clear language of the law. (Paras 5-6)
Facts of the case:
An insurance company deposited the maximum required security and applied for approval to conduct accident insurance business under the relevant Act. The executive withheld approval. The company brought actions to enforce what it alleged to be a statutory duty to grant approval and further contended that the mandatory requirement for employers to obtain insurance from a state insurer made the business of private accident insurance futile.
Findings of Court:
The executive acts in its discretion when approving or disapproving applicants for insurance business; there is no statutory duty to grant approval simply because security has been deposited. The requirement for employers to use the state insurer is an obligatory provision that must be followed as written.
Issues: Whether the executive is statutorily obligated to grant approval for the conduct of accident insurance business upon the deposit of security, and whether a mandatory state insurance requirement can be disregarded if it renders private insurance futile.
Ratio Decidendi: The phrase "may approve" confers a discretionary power upon the executive, which is not subject to judicial control. In statutory interpretation, the plain words of an enactment must be upheld regardless of whether they create a practical impossibility for private entities or result from a legislative error, as the power to correct such errors rests solely with the legislature.
Result: Appeal dismissed.
Legal Category Hierarchy
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administrative law
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statutory interpretation
- discretionary power
- plain meaning rule
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statutory interpretation
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insurance law
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workers compensation
- accident insurance
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workers compensation
Lord Sumner:-
These are consolidated appeals in two actions, which in substance were brought to assert rights and to obtain relief under section 7 of the Queensland Workers Compensation Act of 1916; but section 8 of that Act also came in question, and further the validity of various Regulations made under the Act. These Regulations however are not now material. In the course of the proceedings it was ordered that certain questions of law should be argued, and these appeals contest only the answers given to the questions which arose upon the above-named sections 7 and 8.
The Workers" Compensation Act of 1916 repealed the previous Workers" Compensation Acts and Employers" Liability Acts and took their place. Under them, companies, like the appellants, had insured employers against their liability to workmen for industrial accidents. Section 7 of the new Act fixes the conditions, upon which thereafter they may carry on in Queensland the business of "accident insurance," that is to say, "insurance against liability in relation to workers" compensation under this Act."
The section is threefold. Firstly, "the Governor in Council may approve that any company" (such as the appellants are) may carry on the business of accident insurance. Secondly, "such approval shall be granted upon such applicant giving security" to a maximum amount of 5,000/., " or such less sum as the Treasurer may fix." Thirdly, "on the making of such deposit, the Governor in Council shall grant to the applicant a certificate to the effect that such deposit has been made, and that the Governor in Council has approved that the applicant may carry on in Queensland the business of accident insurance." These are three separate things, and the words "may approve" and "shall be granted" are significant. The Governor in Council acts as chief of the executive, and acts constitutionally on the advice of his Ministers. Approval or disapproval is an act involving a choice, which (subject to his constitutional obligation) is his choice. This act, therefore, is not merely ministerial. He approves or disapproves in his discretion. If he disapproves, there is an end of the matter. No appeal lies from his refusal to approve, nor is he subject in this matter to control by any Court. If he approves, then, and only then, there arises a question as to the grant of that approval, that is, a grant to the applicant. Its form is prescribed : the grant is by certificate; and a condition of the grant, performable by the applicant, is also prescribed, namely, the deposit of money by way of security.
To avoid any question with the Treasurer, who would clearly have had a discretion in fixing the security at less than the maximum, the appellants deposited the whole 5,000/., and then applied to the Governor for his approval as a matter of right. In his discretion he withheld approval, and the appellants brought these actions to enforce what they now allege to be his statutory duty towards them. In their Lordships" opinion these actions so far fail. There is no such statutory duty as is alleged.
If relief under section 7 cannot be obtained, little more need be said, the Regulations being no longer in question. Sec. 8 provides that "it is obligatory for every employer to obtain from the Insurance Commissioner a policy of accident insurance for the full amount of the liability to pay compensation under this Act to all workers employed by him." The employer is liable to the Commissioner under the Act to reimburse to him his payments to the injured worker or his dependants, for, under the scheme of the Act, these are recoverable from the Commissioner directly, and, by the first words of the section, it is this liability that the employer must cover with the Commissioner as a State insurer.
The appellants say that to impose such an obligation on the employer would make the business of accident insurance futile, even if they were to obtain leave to carry it on under section 7. Probably it would, for no one
