Scottish Court of Session Decisions

The Workmen's Compensation Act 1906 (6 Edw. VII, cap. 58) enacts — “Second Schedule (9) (as applied to Scotland) — Where the amount of compensation under this Act has been ascertained … by agreement, a memorandum thereof shall be sent … to the [Sheriff-Clerk], who shall … on being satisfied as to its genuineness, record such memorandum in a special register without fee, and thereupon the memorandum shall for all purposes be enforceable as a [recorded decree-arbitral]. Provided that—.… ( b) Where a workman seeks to record a memorandum of agreement between his employer and himself for the payment of compensation under this Act, and the employer … proves that the workman has in fact returned to work and is earning the same wages as he did before the accident, and objects to the recording of such memorandum, the memorandum shall only be recorded, if at all, on such terms as the [Sheriff], under the circumstances, may think just.”

In an arbitration under the Workmen's Compensation Act 1906 in the Sheriff Court

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at Hamilton, between William Matthews and William Baird & Company, Limited, in which Matthews presented an application for warrant to the Sheriff-Clerk to record a memorandum of an alleged agreement between the parties, the Sheriff-Substitute ( Thomson) granted warrant on certain conditions, and, at the request of the applicant, stated a case for appeal.

The Case stated — “The said application set forth that the appellant had been earning at the time of the accident 30s. 8d. per week, and that he had been since the date of the accident, and still was, incapacitated for work as a consequence of the accident.

“The respondents lodged in reply a minute objecting to the recording of said memorandum on the ground that the appellant had returned to work and was earning the same wages as he did before the accident, and they explained and averred that in terms of paragraph 12 of the Act of Sederunt of 26th June 1907 the question fell to be settled by arbitration.

I allowed a proof, which was taken, and I found in fact (1) that the appellant on 16th March 1909 met with an accident in the respondents' employment; (2) that his average weekly earnings were then 30s. 8d., and that he was by agreement to be paid compensation at the rate of 15s. 4d. per week during total incapacity for work in respect of said accident; (3) that he was accordingly paid such compensation from the date of the accident till 29th June, when payment was stopped, the ground alleged for stoppage being that he was then fit for his former employment; (4) that no steps were thereupon taken by either party, but that the appellant returned to his former work with the respondents on 20th July, earning higher wages than before the accident, viz., 31s. 2d. per week; (5) that he attempted but failed to prove that although he had resumed his former work he was unfit for it, and I found that he had been remonstrated with on more than one occasion for laziness, and that finally, on 6th August, on a reduction of the staff of men, was dismissed although quite fit for his work; (6) that since said last-mentioned date he had not been working or earning any wages, and that particularly he was not working or earning wages at the date of presentation of said memorandum, nor at the date of the presentation of the minute to record same, nor at the date of the proof taken before me; (7) that it was not proved that total incapacity for work had supervened since his dismissal.”

The Sheriff-Substitute granted warrant to the Sheriff-Clerk to record the memorandum of agreement subject to these terms and conditions:—“(1) That the said recorded memorandum of agreement should only be a ground of charge for compensation between 29th June and 20th July 1909; (2) that no charge should be given thereupon till the expiry of three weeks from 14th January 1910; (3) that if the respondents presented an application to the Court within said three weeks to have the compensation reduced or ended as from said 29th June, or any other date prior to said 20th July, no charge should be given until final judgment in said application.”

The questions of law were—“(1) Whether on the facts admitted or proved the arbiter should have granted warrant to record said memorandum of agreement de plano? (2) Whether in view of the fact that at the date when the appellant sought to record said memorandum of agreement he was neither working nor earning any wages, the arbiter was bound to grant warrant to record said memorandum of agreement without adjecting thereto the conditions which he has done.”

The appellant argued—The Sheriff was bound to grant warrant unconditionally unless the circumstances were within section 9 ( b) of Schedule II of the Workmen's Compensation Act 1906 (6 Edw. VII, cap. 58). That section authorised the granting of the warrant conditionally only if the workman had returned to work and was earning the same wages as before the accident, i.e., at the time of the application for warrant to record. The sixth finding in fact established that that was not so in this case. The words of the section were plain and unambiguous and not susceptible of construction. Nor was it a good answer to the application that the workman had recovered — Coakley v. Addie & Sons, Limited, 1909 S.C. 545, 46 S.L.R. 408. This view involved no hardship on the employers, for they could have proceeded by way of arbitration even though there was an unrecorded agreement— Nelson v. Summerlee Iron Company, Limited, 1910 S.C. 360, 47 S.L.B. 344. Counsel also referred to Dunlop v. Rankin & Blackmore, November 27, 1901, 4 F. 203, 39 S.L.R. 146.

Argued for the respondents—Section 9 ( b) of the second schedule applied, for it was sufficient if the workman had returned to work at the same wages as before the accident, even though he should be subsequently out of employment for reasons totally unconnected with incapacity. In that view the section was simply declaratory of the law laid down in Nimmo & Company, Limited v. Fisher, 1907 S.C. 890, 44 S.L.R. 641, and Beath & Keay v. Ness, November 28, 1903, 6 F. 168, 41 S.L.R. 113. The object of the section was to simplify the procedure by way of suspension of a charge resorted to in these cases. Further, if the appellant's view were right, it also followed that if he had returned to work and were earning higher wages than before the accident the Sheriff would nevertheless be bound to grant an application for warrant to record. That was out of the question, and the Act must be construed in a reasonable way so as to avoid unnecessary litigation. The Sheriff was entitled to exercise a discretion not directly conferred on him by the Act— M'Ewan v. William Baird & Company, Limited, February 10, 1910, 47 S.L.R. 430; M'Vey v. William Dixon, Limited, March 18, 1910, 47 S.L.R. 463. It was doubtful if the respondents could have safeguarded themselves by an application for review— per Lord President in Lochgelly Iron and Coal Company,

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Limited v. Sinclair, 1909 S.C. 922, at p. 934, 46 S.L.R. 665, at p. 671. Nelson v. Summerlee Iron Company, Limited, cit., dealt with the competency of arbitration and not with an application for review. In any case, if the respondents were wrong the case should be returned to the Sheriff to be dealt with by him. Counsel also referred to Malcolm v. Bowhill Coal Company, Limited, 1909 S.C. 426, 46 S.L.R. 354.