Basit v Haden FM Pty Ltd trading as Resolve FM
[2008] NSWWCCPD 24
•22 February 2008
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:Basit v Haden FM Pty Ltd t/as Resolve FM [2008] NSWWCCPD 24
APPELLANT: Abdul Basit
RESPONDENT: Haden FM Pty Ltd t/as Resolve FM
INSURER:Allianz Australia Workers Compensation (NSW) Ltd
FILE NUMBER: WCC6024-05
DATE OF ARBITRATOR’S DECISION: 23 October 2007
DATE OF APPEAL HEARING: 19 February 2008
DATE OF APPEAL DECISION: 22 February 2008
SUBJECT MATTER OF DECISION: Reconsideration under section 350(3) of the Workplace Injury Management and Workers Compensation Act 1998; relevance of a Medical Assessment Certificate to an application for reconsideration; inconsistent findings between Medical Assessment Certificate and Arbitrator’s original decision
PRESIDENTIAL MEMBER: Deputy President Bill Roche
HEARING:Oral
REPRESENTATION: Appellant: McDonnell Schroder
Respondent: Ellison Tillyard Callanan
ORDERS MADE ON APPEAL: Paragraph one of the Arbitrator’s determination of 23 October 2007 is revoked and the following order made:
“The matter is remitted to a different Arbitrator to re-determine the Appellant Worker’s reconsideration application in accordance with the reasons and principles in this decision, and, if appropriate, to re-determine any entitlement/s he may have consequent upon that reconsideration.”
Paragraphs two, three and four of the Arbitrator’s determination of 23 October 2007 are confirmed.
The Respondent Employer is to pay the Appellant Worker’s costs of this appeal.
BACKGROUND TO THE APPEAL
Abdul Basit (‘the Appellant Worker/Mr Basit’) was born in Afghanistan in 1968 and came to Australia in 1999. He started work with Haden FM Pty Ltd t/as Resolve FM (‘the Respondent Employer/Haden’) as a property officer on 2 February 2004. He injured his back in the course of his employment with Haden on 8 March 2004 as a result of lifting a laundry basket containing household goods. He saw his general practitioner, Dr Chanda, on 9 March 2004 and was prescribed analgesics and advised to rest. He attempted to return to work on light duties on 12 March 2004 but was unable to continue. His claim was initially accepted, but liability was declined from 17 September 2004.
The Commission registered Mr Basit’s Application to Resolve a Dispute (‘the Application’) on 26 April 2005. In it he claimed weekly compensation from 17 September 2004 to date and continuing, hospital and medical expenses, and compensation for permanent impairment.
The matter proceeded to arbitration on 3 August 2005 (‘the first arbitration’) when Mr Eistis, a solicitor, represented Mr Basit and Mr Egan, of counsel, represented Haden. After hearing lengthy submissions from the parties representatives the Arbitrator delivered an ex tempore decision which resulted in a Certificate of Determination dated 9 August 2005 (‘the first determination’) in the following terms:
“1.There is an award for the Respondent in respect of the Applicant’s claim of permanent impairment as a result of the incident on 8 March 2004.
2.There is an award for the Respondent in respect of the Applicant’s claim for weekly compensation pursuant to s.40 of the Workers Compensation Act 1987, for the period from 17/9/2004.
3.There is an award for the Respondent, in relation to the Applicant’s claim for medical expenses incurred pursuant to s60 of the Workers Compensation Act 1987 from 17/9/2004 to date.
4. There is no order as to costs.
5.This matter, which went directly to arbitration, was a complex matter as provided for by Regulation 129 of the Workers Compensation (General) Amendment (Costs) Regulation 2001.”
In his reasons in support of this determination the Arbitrator said, among other things, that:
(a)Mr Basit’s credit was not in issue before him and he made no finding as to matters alleged by Mr Egan (T58.28);
(b)he rejected Mr Basit’s evidence that he had no back problems and was completely free of pain at the time of the injury on 8 March 2004 (T59.12 and T59.29);
(c)Mr Basit experienced “ongoing significant back pain with radiation to the left leg and ankle over a significant period of time [prior to his work injury] for which he sought treatment” (T59.23);
(d)treatment consisted of “referrals to various specialists, orthopaedic, neurologists” (T59.26);
(e)Mr Basit also had physiotherapy and hydrotherapy before the March 2004 injury and that treatment did not assist him (T59.28);
(f)Mr Basit “suffered a broad-based protrusion at L4-5” (T59.48);
(g)the injury that Mr Basit claimed to have suffered on 8 March 2004 “resulted in no greater impairment than that already identified in the earlier report” (T60.10);
(h)the later CT scan (done after the injury on 8 March 2004) reported a small broad-based posterior bulge of the L4-5 disc which compressed the extradural fat and was probably of significance (T60.13);
(i)the MRI scan showed no nerve root impingement (T60.17);
(j)it appeared to him “from the medical evidence and the investigations that there is no injury of significance which the applicant suffered on 8 March 2004. While I might accept that he suffered an injury within the meaning of section 4, being an aggravation of his pre‑existing condition, I do not find that he received an injury that resulted in any permanent impairment of his back that was caused by his work for the respondent on that day.” (T60.20-28);
(k)the medical evidence pointed to the fact that Mr Basit suffered “no more than a musculoligamentous strain which should have resolved” (T60.32);
(l)Dr Maniam stated that the incident on 8 March 2004 appeared to be an aggravation of a pre-existent problem and added that the injuries were musculoligamentous (T60.53-58);
(m)while he accepted that Mr Basit suffered a short term period of incapacity, “the reports all indicate that he should have recovered – in fact, state that he would have recovered and will recover from the aggravation that he sustained within a short period of time, yet the applicant is still alleging that he is incapacitated.” (T61.11-16);
(n)Dr Bornstein was of the opinion that Mr Basit showed only degenerative changes which were not the result of the March 2004 incident, which was simply a back strain which had resolved (T61.18-23);
(o)the only doctor who provided a report somewhat different to that was Dr Deveridge who did not have a full history and certainly did not have the earlier (pre-accident) CT scan (T61.26), and
(p)Mr Basit suffered only “a minor aggravation and that there should be no compensation beyond 17 September 2004, at which date I accept that the incapacity should be deemed to have ended.” (T61.38).
There then followed an exchange between the Arbitrator and the legal representatives about the claim for hospital and medical expenses under section 60 of the Workers Compensation Act 1987 (‘the 1987 Act’) in which Mr Egan said at T62.4:
“MR EGAN: Liability was not denied until 17 September, and, therefore, you would just merely be entering an award for the respondent in respect of both weekly compensation, the claim for section 60 expenses and the claim for permanent impairment. If there was any outstanding treatment expenses incurred during the period that liability was accepted and paid, that would no doubt be picked up in the system.”
The Arbitrator acceded to this submission and made the orders sought.
Without obtaining legal representation, Mr Basit appealed the Arbitrator’s decision. Acting Deputy President Handley determined the appeal on 6 March 2006 (Basit v Haden FM t/as Resolve FM [2006] NSWWCCPD 38 (‘the first appeal’)). The grounds of appeal raised issues of procedural fairness and whether the Arbitrator accorded proper weight to the medical evidence. In addition, Mr Basit sought leave to introduce four documents as fresh evidence on appeal. They were:
(a)an MRI scan report of Mr Basit’s lumbar spine by Dr Carr dated 20 April 2004, showing a “mild diffuse disc bulge at the L4/5 level”;
(b)a second MRI scan report of Mr Basit’s lumbar spine by Dr Carr dated 20 April 2004, showing no abnormality;
(c)a CT scan report by Dr Critoph dated 9 February 2006, and
(d)a Preplacement Health Evaluation undertaken for Haden before Mr Basit commenced employment with that company.
The MRI scan dated 20 April 2004 showing the diffuse bulge at L4/5 was already in evidence. The Preplacement Health Evaluation was admitted on appeal, but the second and third documents listed above were not admitted.
The Acting Deputy President found that the Arbitrator “made errors of law in his decision with regard to the issues of injury and permanent impairment” (at [24]). He added at [25] “there was nothing to indicate that he [the Arbitrator] did not accord proper weight to all the medical evidence, including that of Dr Deveridge”. In conclusion, the Acting Deputy President said at [28]:
“In conclusion, the Arbitrator having made errors of law in his decision in relation to Mr Basit’s claim for compensation for permanent impairment, as explained in paragraph 24 above, clauses 1 and 4 of the determination must be revoked. However, I am not satisfied that the Arbitrator made any error in relation to his finding that Mr Basit’s incapacity resulting from the injury had ceased by 17 September 2004, with the result that clauses 2 and 3 of the determination should be confirmed. In my view, clause 5 should also be confirmed. With regard to the revocation of clause 1, the appropriate course is to remit the issues of injury and permanent impairment to the Arbitrator for determination in accordance with the law. With regard to clause 4, a decision on the payment of costs should be deferred pending that determination.”
In accordance with the Acting Deputy President’s decision, paragraphs one and four of the Arbitrator’s first determination were revoked and “the issues of injury and permanent impairment” were remitted to the Arbitrator for determination in accordance with law.
By letter dated 22 March 2006, Mr Basit sought a reconsideration of the Acting Deputy President’s decision. No substantive reason was given in support of the reconsideration application, which was refused by decision dated 27 March 2006 (see Basit v Haden FM t/as Resolve FM [2006] NSWWCCPD 38R (‘the first reconsideration decision’)). In his reasons for refusing the reconsideration application the Acting Deputy President, being uncertain as to the basis of the application, said at [5]:
“Essentially, the opinion I formed on review of the matter was that there was sufficient evidence to support the Arbitrator’s finding that Mr Basit only suffered a minor aggravation of his pre-existing back condition in the incident at work on 8 March 2004 – a musculoligamentous strain – and that Mr Basit did not have an incapacity after 17 September 2004. Thus, Mr Basit had no ongoing entitlement to weekly compensation payments beyond that date.”
At a teleconference on 7 April 2006 the question of Mr Basit’s whole person impairment was by consent referred to an Approved Medical Specialist (‘AMS’). The Request for Assessment of Permanent Impairment by Approved Medical Specialist, dated 7 April 2006, includes the following notation by the Arbitrator:
“IMPAIRMENT Issues Determined by Arbitrator (delete if the above has been agreed by the parties)
I NOTE THAT AT AN ARBITRATION ON 3 AUGUST 2005, I DETERMINED THAT THE APPLICANT HAD SUFFERED AN AGGRAVATION OF HIS PRE-EXISTING CONDITION – A MUSCULOLIGAMENTOUS STRAIN – IN THE COURSE OF HIS EMPLOYMENT.”
An AMS (Dr Mellick) examined Mr Basit on 10 May 2006 and issued a Medical Assessment Certificate (MAC) on 1 June 2006 assessing him to an 8% whole person impairment as a result of his injury on 8 March 2004 but with no deduction for any pre-existing injury, condition or abnormality.
By an undated letter from Mr Basit (received by the Commission on 2 November 2006) he sought a further reconsideration of Acting Deputy President Handley’s decision on the basis of the AMSs assessment of 8% whole person impairment and an MRI scan dated 24 August 2006. This letter was forwarded to the original Arbitrator.
By letter dated 3 November 2006 Mr Basit wrote to the Arbitrator seeking a reconsideration of his decision “in regard to my weekly benefit” on the basis of the AMSs assessment of 8% whole person impairment and the MRI scan said to be dated 22 August 2006 (presumably this is a reference to the MRI scan from Dr O’Rourke dated 24 August 2006).
Haden appealed the MAC and on 15 November 2006 a Medical Appeal Panel revoked the MAC and issued a second MAC assessing Mr Basit to have an 8% whole person impairment but deducted 10% for his pre-existing back condition leaving an impairment of 7.2%, which was rounded down to 7%. The Appeal Panel made the 10% deduction under section 323(2) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) because in the Panel’s opinion the exact amount of the deduction was difficult to determine and it therefore applied the statutory one-tenth deduction.
Mr Basit again wrote to the Commission by undated letter (received by the Commission on 11 December 2006) stating:
“In view of the biding [sic] medical assessment of worker [sic] compensation approved specialist and appeal panel to the effect that as a result of the injury the subject of this claim I have seven percent impairment in [sic] pursuant to section 350 of the Work Place Injury management in worker compensation ACT [sic] 1998 and Worker[s] compensation ACT 1987 section 35, 36, 37 and section 61, I am requesting the above mentioned compensation as a [sic] following:”
This letter also states “I have been awarded 7% impairment which is the amount of $8,750 Dollar [sic] as well as compention [sic] pursuant [to] section 36 and 37 and/or section 40…”. Mr Basit set out the value of the arrears of his claim for weekly compensation and his outstanding medical expenses. Also in the Commission’s file is a letter from Mr Basit dated 28 December 2006 (stamped “Received” by the Commission on 27 December 2006) attaching a two page note addressed to the Arbitrator stating, among other things, that he had been mistakenly asking the Presidential member for a reconsideration but after speaking with a person at the Commission’s appeals department he now submitted his reconsideration application to the Arbitrator.
The matter was set down for further arbitration on 1 February 2007 (‘the second arbitration’) to deal with the Appeal Panel MAC and with Mr Basit’s application for reconsideration. As directed by the Arbitrator, the Respondent Employer filed written submissions on 19 January 2007 in which it argued:
(a)Mr Basit should not be allowed to “further re-litigate these issues”;
(b)the MRI scan of 24 August 2006 was not “fresh evidence” as it was in “almost identical terms to that found in the radiological reports of 2001 and 2003” and it would not add to Mr Basit’s case nor would it have changed the original decision if available at that time;
(c)the report from the AMS (Dr Mellick) was contrary to the weight of medical evidence in the original arbitration and was not supported by the Medical Appeal Panel;
(d)the AMSs opinion was restricted “only as to the permanent impairment and not as to the relationship or otherwise of payment [sic, impairment] to any work injury” (Issott v North Sydney Leagues Club Limited [2005] NSWWCCPD 38 (Issott)), and
(e)that an award for the Respondent should be entered for the Respondent Employer in respect of the claim for lump sum compensation.
In support of his reconsideration application Mr Basit relied on the following “fresh evidence”:
(a)a CT scan report by Dr Crioph dated 9 February 2006;
(b)an MRI scan report by Dr O’Rourke dated 24 August 2006;
(c)an MRI scan report by Dr Carr dated 20 April 2004, showing a mild diffuse bulge at L4/5, and
(d)the Preplacement Health Evaluation undertaken by the Respondent Employer before Mr Basit started work. (Statement of Reasons for Decision (‘Reasons’) 19 February 2007, paragraph 19).
After referring to various authorities on reconsiderations, the Arbitrator noted that three of the documents had been considered in either the first arbitration or the first appeal and did not constitute “fresh evidence”. In respect of the fourth, Dr O’Rourke’s MRI scan, he held that it was “new evidence” but it would not have influenced the outcome of the proceedings in respect of the claim for weekly compensation (Reasons 19 February 2007, paragraph 29).
Mr Basit also relied on the MAC by Dr Mellick and the Medical Appeal Panel report. As the Appeal Panel MAC revoked Dr Mellick’s MAC, it is more accurate to say that Mr Basit relied on Dr Mellick’s report and the Appeal Panel MAC and its reasons. Nothing turns on this error.
Without referring to the MAC or the Medical Appeal Panel report, the Arbitrator determined that the overall weight of the evidence was “overwhelmingly unfavourable to his claim for weekly compensation” and it was “in the public interest that litigation of this matter should not proceed indefinitely” (Reasons 19 February 2007, paragraph 31). He also stated that though the Respondent Employer initially “sought a determination in respect of permanent impairment, [it] conceded at the arbitration hearing that it would accept the assessment of the medical appeal panel of 7% whole person impairment” (Reasons 19 February 2007, paragraph 16).
In a Certificate of Determination dated 19 February 2007 (‘the second determination’) the Arbitrator made the following determination:
“1. The application for reconsideration is refused.
2.The Respondent is to pay to the Applicant as lump sum compensation under section 66 of the Workers Compensation Act 1987, the sum of $8,750.00 in respect of 7.0 per cent permanent impairment assessed as a percentage of whole person impairment as conclusively assessed by a Medical Appeal Panel on 15 November 2006.
3.I certify that this matter… is a complex matter…
4.The Respondent is to pay the Applicant’s costs as agreed or assessed up to and including 20 December 2006.”
By an appeal filed on 16 March 2007 Mr Basit challenged (through a solicitor) the second determination on the grounds that he was denied procedural fairness and that the Arbitrator failed to take into account the evidence of the AMS and the Medical Appeal Panel, and failed to provide any reasons for that omission. Acting Deputy President Moore decided the second appeal on 2 August 2007 (Basit v Haden FM t/as Resolve FM Pty Ltd No 2 [2007] NSWWCCPD 170 (‘the second appeal’) and made the following orders:
“1. The decision of the Arbitrator dated 19 February 2007 is revoked.
2.The matter is remitted to the Arbitrator at first instance for reconsideration of the outstanding issues between the parties in accordance with these reasons.
3.Costs of the proceedings before the Arbitrator to date are reserved pending the outcome of the remitter.
4. The Respondent is to pay the costs of the appeal.” (emphasis added)
Acting Deputy President Moore rejected Mr Basit’s argument that he had been denied procedural fairness but found that the Arbitrator had erred in failing to properly consider the “fresh evidence” of the MAC dated 1 June 2006 and the Medical Appeal Panel dated 15 November 2006.
A third arbitration was held on 4 October 2007. On this occasion both parties were represented by counsel who each made lengthy submissions as to the “outstanding issues” the Arbitrator was to determine. Counsel for Mr Basit, Mr Hanrahan, submitted that the hearing was an opportunity to deal with all of the medical evidence and to hear oral evidence from Mr Basit. Counsel for Haden, Mr Egan, submitted that the only task that remained was for the Arbitrator to give sufficient reasons as to whether the MAC and Medical Appeal Panel report constituted fresh evidence that would more likely than not have influenced the outcome of the determination in respect of weekly compensation.
The Arbitrator rejected the approach suggested by Mr Hanrahan on the grounds that it was “tantamount to conducting a re-hearing of the Applicant’s claim for a second time under the guise of re-considering whether there existed sufficient reasons to do so” (Reasons 23 October 2007, paragraph 20). He determined that it was appropriate for there to be a re-examination “but only of the two additional relevant documents which were considered to be ‘fresh evidence’ in the reconsideration, the MAC of Dr Mellick dated 1 June 2006 and the Appeal Panel decision of 15 November 2006” (Reasons 23 October 2007, paragraph 21). The Arbitrator also noted (at paragraph 24 of his Reasons) the following comment by Acting Deputy President Moore at [62] of the second appeal:
“Having accepted that this material [the MAC and the Medical Appeal Panel report] was not available at the original hearing, the question to consider is whether that material would have altered or influenced the outcome of the proceedings.”
In a Certificate of Determination dated 23 October 2007 (‘the third determination’) the Arbitrator made the following determination:
“1. The application for reconsideration is refused.
2.The Respondent is to pay to the Applicant as lump sum compensation under section 66 of the Workers Compensation Act 1987, the sum of $8,750.00 in respect of 7.0 per cent permanent impairment assessed as a percentage of whole person impairment as conclusively assessed by a Medical Appeal Panel on 15 November 2006.
3.I certify that this matter…is a complex matter pursuant…
4.The Respondent is to pay the Applicant’s costs of the conferences conducted before me, as agreed or assessed, up to and including 20 December 2006.”
By an appeal file on 19 November 2007, Mr Basit seeks leave to appeal the third determination.
LEAVE TO APPEAL
Monetary Threshold
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act.
It is not disputed that the quantum in issue on the appeal is in excess of $5,000.00 and therefore the threshold in section 352(2)(a) of the 1998 Act is satisfied. No award of weekly compensation has been made in this case but the Arbitrator’s finding would result in the Respondent Worker receiving no compensation and therefore the second limb of section 352(2) does not apply (see Mawson v Fletchers International Exports Pty Ltd [2002] NSWWCCPD 5).
Time
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
I grant leave to appeal.
ISSUES IN DISPUTE
The issues in dispute in the appeal are whether the Arbitrator erred in:
(a)failing to use his best endeavours under section 355 of the 1998 Act to bring the parties to a settlement acceptable to each of them;
(b)failing to properly consider the statutory test in deciding whether the MAC and the Medical Appeal Panel report would have influenced his decision as to whether the worker suffered any incapacity beyond 17 September 2004;
(c)failing to address or consider the statutory test for medical expenses in circumstances where injury was found to cause permanent impairment;
(d)failing to take into account relevant considerations under section 43A of the 1987 Act in relation to the effect of the MAC and the Medical Appeal Panel report on the whole of the evidence;
(e)taking into account irrelevant considerations;
(f)refusing to exercise his statutory duty to make findings and decide questions of fact;
(g)acting contrary to the effect of section 326 of the 1998 Act by questioning the correctness of the assessment made by the Medical Appeal Panel which is conclusive and binding on him, and
(h)failed to give sufficient reasons to “adequately explain in terms understandable to the worker” the inconsistency between the basis for his original determination and his most recent decision.
At the oral hearing of the appeal, counsel for Mr Basit abandoned the first ground of appeal.
FRESH EVIDENCE
Neither party seeks to rely on fresh evidence on appeal.
SUBMISSIONS AND FINDINGS
Mr Basit argues that the Arbitrator failed to address the steps necessary to formulate whether or not a determination of incapacity, as set out in Mitchell v Central West Area Health Service (1997) 14 NSWCA 526 (‘Mitchell’), might be affected by the Appeal Panel MAC. At the oral hearing before me, counsel for Mr Basit conceded the merit of the Respondent Employer’s argument that in Mitchell the Court was concerned with the correct application of section 40(2)(b) of the 1987 Act in circumstances where there had been a finding by the trial judge of ongoing partial incapacity. In the present matter the Arbitrator determined that there was no ongoing incapacity and, therefore, did not have to proceed to apply the steps in Mitchell.
The real issue on appeal is whether the Arbitrator properly considered whether the Appeal Panel MAC and reasons, and Dr Mellick’s report, would have influenced his decision in the first determination of 9 August 2005. In the first arbitration the Arbitrator found that Mr Basit had only suffered a “minor aggravation” (Reasons 3 August 2005, T61.38), from which he should have recovered, and that he had no entitlement to compensation beyond 17 September 2004, the date on which voluntary compensation ceased. In my view that decision amounted to a clear finding that the effects of the injury had ceased. That is confirmed by the Arbitrator’s third decision when he said that he determined “that the injury on 8 March 2004, was in the nature of a musculoligamentous strain, the effects of which had ceased” (Reasons 23 October 2007, paragraph three).
The Appeal Panel MAC certified that Mr Basit has an 8% whole person impairment but after applying a 10% discount under section 323 of the 1998 Act that loss has been discounted to 7%. The finding of a 7% whole person impairment certifies as to Mr Basit’s whole person impairment and is conclusively presumed to be correct (section 326(1)(a) of the 1998 Act). Whilst MACs do not determine liability issues such as ‘injury’ and ‘causation’ (see Jopa Pty Limited t/as Tricia's Clip-n-Snip v Edenden [2004] NSWWCCPD 50, Issott; Ooi v NEC Business Solutions Limited [2006] NSWWCCPD 131, and Connor v Trustees of the Roman Catholic Church for the Archdiocese of Sydney [2006] NSWWCCPD 124 at [48]) and it may well have been open to the Respondent Employer to contest liability in respect of the 7%, the percentage certified by the Appeal Panel has, after a contested hearing, been entered into an order of the Commission in favour of Mr Basit (see the second and third determinations) and, therefore, liability is not now in issue in respect of that 7%.
A certification of a 7% whole person impairment in a MAC involves an acceptance by the AMS and, in this case, the Appeal Panel, that the effects of the injury have not ceased but are continuing. Once liability in respect of that 7% impairment is determined against the employer (as it has been in this matter) it is not open for a determination that the effect of the injury has ceased (as found by the Arbitrator in his first decision) to stand because such a finding is fundamentally inconsistent with the award for permanent impairment compensation (see Total Steel of Australia Pty Ltd v Waretini [2007] NSWWCCPD 33).
It is therefore not surprising that upon receipt of the Appeal Panel MAC Mr Basit sought a reconsideration of the Arbitrator’s first decision. Whilst it appears that Mr Basit drafted the reconsideration application without obtaining legal advice, its intention was clear. He sought a reconsideration of all the adverse findings and orders made against his interests by the Arbitrator in the first arbitration. Those orders resulted not only in the making of an award for the Respondent Employer in respect of the claim for weekly compensation but also in respect of the claim for medical expenses. Both of those orders, and the findings on which they were based, had to be reconsidered by the Arbitrator.
The Commission considered the scope of a reconsideration application in Samuel v Sebel Furniture Limited [2006] NSWWCCPD 141 and Nan v Country Road Freight Services Pty Limited [2006] NSWWCCPD 160. Those cases referred to and applied the principles discussed by Judge Bishop in Maksoudian v J Robins & Sons Pty Ltd (1993) 9 NSWLR 642 (Maksoudian) where his Honour said at 645:
“There is no doubt that the discretion of this Court to reconsider is wide and far reaching. The task of the Court is to balance the policy requirement of finality of litigation with the obligation to rectify any clear cut injustice. The cases do not comprehensively indicate how the Court is to approach this task, but it does seem that two broad requirements are laid down. The first of these is that the material leading to an application for reconsideration must be what can broadly be described as ‘fresh evidence’, namely material that with reasonable diligence could not have been put before the Court at the time of the original proceedings and the application for reconsideration has to move with appropriate speed and diligence to bring that matter to the Court’s attention. The second point is that the fresh evidence must be of such a nature that if it had been before the Court when the original proceedings were heard it would more likely than not have affected the outcome of the proceedings: Hardaker v. Wright & Bruce Pty Ltd (1962) 62 SR (NSW) 244 and Hilliger v. Hilliger (1952) 52 SR (NSW) 105.”
In the circumstances of the present matter there is no dispute that the Appeal Panel MAC and the reasons given by Dr Mellick constitute ‘fresh evidence’ that was not available when the original proceedings were heard. The dispute centres on whether these documents are of such a nature that, if they had been before the Arbitrator when the original proceedings were heard, they would more likely than not have affected the outcome of the proceedings.
The Arbitrator approached his task in the second arbitration by referring to paragraph [28] of Acting Deputy President Handley’s decision of 6 March 2006, where the Acting Deputy President said:
“However, I am not satisfied that the Arbitrator made any error in relation to his finding that Mr Basit’s incapacity resulting from the injury had ceased by 17 September 2004, with the result that clauses 2 and 3 of the determination should be confirmed.”
The Arbitrator also quoted the Acting Deputy President’s reconsideration decision dated 27 March 2006 where at paragraph [5] he confirmed his view that:
“…there was sufficient evidence to support the Arbitrator’s finding that Mr Basit only suffered a minor aggravation of his pre-existing back condition in the incident at work on 8 March 2004 – a musculoligamentous strain – and that Mr Basit did not have an incapacity after 17 September 2004. Thus, Mr Basit had no ongoing entitlement to weekly compensation payments beyond that date.”
The Arbitrator then reviewed the authorities on reconsiderations and referred to four documents Mr Basit sought to rely on in support of his application (Reasons 19 February 2007, paragraph 28), but made no specific reference to the Appeal Panel MAC or the reasons given by Dr Mellick. At paragraph 30 of his Reasons dated 19 February 2007 he noted that medical reports that did not have a history of Mr Basit’s pre-injury back problems were incomplete and misleading. He concluded that Mr Basit’s entitlement to weekly compensation would have ceased after a period of rehabilitation and rest and refused the application for reconsideration, but made an award in favour of Mr Basit in the sum of $8,750.00 under section 66 of the 1987 Act in respect of his 7% whole person impairment.
In the second appeal, decided by Acting Deputy President Moore on 2 August 2007, the Arbitrator’s second determination was revoked on the ground that by failing to consider the Appeal Panel MAC and Dr Mellick’s reasons he failed to exercise his statutory duty to lawfully and fairly determine the matter. The whole of the Arbitrator’s second determination was revoked and the matter remitted for “reconsideration of the outstanding issues between the parties in accordance with these reasons”.
Counsel represented each party at the third arbitration. A dispute arose as to the nature of the question to be determined by the Arbitrator on the remittal from Acting Deputy President Moore. Mr Hanrahan submitted that the hearing was an opportunity to deal with all the medical evidence and to hear oral evidence from Mr Basit as to the nature of the incapacity he suffers as a result of the injury on 8 March 2004. Mr Egan argued that the only outstanding task for the Arbitrator to determine was whether the Appeal Panel MAC and Dr Mellick’s report constituted fresh evidence that would more likely than not have influenced the outcome of the determination in respect of weekly compensation.
The Arbitrator noted at paragraph 20 of the third arbitration decision:
“Given the history of the matter and the opportunity that the Applicant has had to ventilate his objection to the decision of 3 August 2005, which has twice been rejected by ADP Handley, I declined to adopt the proposal suggested by Mr Hanrahan on behalf of the Applicant. In my view his submissions were tantamount to conducting a re-hearing on behalf of the Applicant’s claim for a second time under the guise of re-considering whether there existed sufficient reasons to do so.”
Whilst the Arbitrator thought that Mr Egan cast the task too narrowly, he effectively agreed with and adopted that approach and held that it was appropriate “for there to be a re-examination, but only of the two additional relevant documents which were considered to be ‘fresh evidence’ in the reconsideration, the MAC of Dr Mellick dated 1 June 2006 and the Appeal Panel decision of 15 November 2006” (Reasons 23 October 2007, paragraph 21).
The Appellant Worker challenges this approach on the following grounds:
(a)the Arbitrator did not address the inconsistency between the Appeal Panel MAC and the Arbitrator’s determination in his first decision that the effects of the work injury had ceased;
(b)the Arbitrator denied the binding nature of the Appeal Panel MAC;
(c)consideration of the whole of the evidence required more than an evaluation of Appeal Panel MAC and Dr Mellick’s reasons;
(d)the Arbitrator had to reconsider the Appeal Panel MAC and Dr Mellick’s reasons in the context of all of the other evidence and to re-balance the scales with the material now available;
(e)rather than reconsidering the matter the Arbitrator summarized his original view about the “nature of the injury and the resulting incapacity” (Reasons, 23 October 2007, paragraph 47), reviewed his own decision favourably and noted that the Appeal Panel’s report and the MAC did not comment of the degree of incapacity;
(f)the Arbitrator did not comprehensively analyse and report on the medical evidence before him, and
(g)the Arbitrator ignored the significantly different picture of injury seen by the Appeal Panel and refused to specifically consider whether that fact would have influenced his original decision.
The Respondent Employer argues that the Arbitrator gave detailed consideration to the matters put to him and gave reasons why the Appeal Panel MAC and Dr Mellick’s report did not alter his decision on incapacity. It is submitted that the question of incapacity caused by any employment injury is a matter for determination by the Arbitrator, not an AMS, and the Arbitrator only had to deal with the fresh evidence in the Appeal Panel MAC and Dr Mellick’s report.
Whilst I accept that the question of incapacity is a matter for an Arbitrator and not an AMS, the Respondent Employer’s submissions, and the Arbitrator’s third decision, fail to acknowledge or deal with the inconsistency between the Appeal Panel MAC (now enshrined in formal orders of the Commission after a contested hearing) and the Arbitrator’s first decision. The fact that these two inconsistent determinations cannot sit together is the critical issue in the case. The subsequent certification of a 7% whole person impairment by the Appeal Panel MAC required the Arbitrator, once liability for the 7% impairment was determined against the employer, to reconsider the whole of his initial determination in the light of the MAC. This required him to reconsider not only the order made in relation to incapacity, but also the order made in respect of medical expenses and the findings on which those orders were based, namely, the finding that Mr Basit had only suffered a musculoligamentous injury, the effects of which had ceased by 17 September 2004.
An examination of the Arbitrator’s third decision discloses that he did not conduct such a reconsideration of his first decision. His reference to Acting Deputy President Handley having twice rejected Mr Basit’s objection to the decision of 3 August 2005 demonstrates that he believed that part of his decision did not have to be reconsidered, regardless of the Appeal Panel MAC. He was in error in holding that view. Acting Deputy President Handley’s decision was delivered before the Appeal Panel MAC and it therefore has limited, if any, relevance to the reconsideration issue that now arises.
At paragraph 48 of his third decision the Arbitrator said:
“After an extensive review of both the MAC and MAP report, I consider that the availability of this material would not have altered or influenced my decision on incapacity and therefore the outcome of the proceedings with respect to the determination of weekly compensation.” (emphasis added)
In expressing his conclusion in this way the Arbitrator failed to deal with the inconsistency between the Appeal Panel MAC and the decision of 3 August 2004. If the effect of the injury was continuing, as the Appeal Panel MAC and the Commission’s order for the payment of lump sum compensation of 7% confirm, the question is: in the light of that fresh evidence, what is the correct finding as to the nature and extent of Mr Basit’s injury and what are the consequences for Mr Basit’s ability to sell his labour on the labour market reasonably accessible to him having regard to that injury and the matters set out in sections 40 and 43A of the 1987 Act. In addition, the Arbitrator was also required to reconsider his previous order in respect of the payment of medical expenses.
The Respondent Employer argues that the legislature has established two parallel decision making processes and, though some incongruous results may arise from such a system, there is nothing incongruous about the result in the present matter as the Arbitrator’s decision was based on the evidence he heard and assessed. I do not accept this submission. Whilst the evidence of Mr Basit’s prior back symptoms was and is most relevant to the assessment of the claim, and was probably decisive in the original determination, the point now argued is that that evidence, and the determination on which it was based, must be reconsidered in light of the Appeal Panel MAC and Dr Mellick’s reasons. The Arbitrator has not done that and his failure constitutes an error.
The Respondent Employer also argues that the Appeal Panel’s reduction of 10% under section 323 of the 1998 Act is not conclusively presumed to be correct under section 326(1)(b) of the 1998 Act and does not prevent the Arbitrator from looking at all the evidence and coming to a different conclusion. I agree that in determining the question of incapacity and the entitlement to weekly compensation an Arbitrator must consider all of the evidence. That does not, however, entitle him to form an independent view as to the section 323 deduction. In Cole v Baytech Industrial Pty Ltd [2005] NSWWCCPD 70 it was noted that whilst section 326(1)(b) of the 1998 Act does not specifically state that the AMSs finding on the amount of the section 323 deduction is binding, “a reading of Part 7 Chapter 7 of the 1998 Act as a whole, leads inescapably to that conclusion” (at [39]). I am in general agreement with that statement, so far as it relates to claims for lump sum compensation.
The question of the extent of any pre-existing impairment is of limited relevance in determining an entitlement to weekly compensation consequent upon a compensable work injury and it is certainly not determinative. It is not uncommon to see workers with a significant permanent whole person impairment who have no economic incapacity. On the other hand some workers who have either no permanent impairment or a very modest impairment may, because of the nature of their disability, work experience, and training have a significant economic incapacity in the labour market reasonably accessible to them. A worker with a 10% whole person impairment may have no economic incapacity, but a relatively minor work injury that results in the worker’s impairment increasing to 12% may have serious consequences for the worker on the open labour market. Similarly, the reverse may occur and an increase in permanent impairment may have no affect on a worker’s entitlement under section 40 of the 1987 Act (Blayney Abattoirs Pty Ltd v McConnell & ors (1998) 16 NSWCCR 205). There is no automatic correlation between the extent of a permanent impairment and the level of compensation under section 40 of the 1987 Act.
The issue is not the extent of Mr Basit’s pre-existing impairment (which may or may not be greater than 10%) but whether the claimed incapacity has resulted from the work injury (section 33 of the 1987 Act). This question required the Arbitrator to focus on and determine the nature and extent of the injury, and its consequences for Mr Basit in terms of his ability to sell his labour in a labour market reasonably accessible to him. The Arbitrator did not determine this issue, but instead focused on a comparison between the percentage of impairment due to “the previous injury” (which he felt was much greater than 10%) (Reasons 23 October 2007, paragraph 44) and the currently assessed impairment of 7%, noting that neither Dr Mellick nor the Appeal Panel undertook any detailed analysis of the nature of Mr Basit’s previous injury or how it affected his current degree of impairment. It was for the Arbitrator to undertake a detailed consideration of Mr Basit’s work capacity and to assess the extent to which that capacity had been reduced as a result of his proven work injury. In determining that question the Appeal Panel MAC was an important piece of evidence to be considered along with all of the other evidence in the case including Mr Basit’s evidence of his work capacity up to and after 8 March 2004. The main significance of the Appeal Panel MAC is that it determined that the effects of the work injury were continuing.
Even if the Arbitrator was not bound by the 10% certified by the Appeal Panel MAC that did not determine the issue before him. The Arbitrator was not permitted to effectively ignore the relevant consequences of the Panel’s certification of a 7% whole person impairment as a result of the injury on 8 March 2004, namely, that the effects of the injury of 8 March 2004 were continuing and resulted in Mr Basit suffering a permanent impairment. The Arbitrator did not properly consider the impact of that finding on his first decision. Therefore, the Arbitrator was in error in rejecting the claim for weekly compensation on the ground that “the percentage impairment due to the previous injury could, and in my view would be much greater, if a proper assessment was carried out” (Reasons 23 October 2007, paragraph 44).
The Appeal Panel MAC therefore requires that the whole of Mr Basit’s claim (including the claim for medical expenses) be reconsidered because had the MAC been available at the original hearing it would “more likely than not have affected the outcome” (Maksoudian).
The purpose of a reconsideration power such as section 350(3) of the 1998 Act is to ensure that justice is done between the parties (per Street CJ in Hilliger v Hilliger (1952) 52 SR (NSW) 105 at 108 and Hardaker v Wright & Bruce Pty Ltd [1962] SR (NSW) 244). In considering the scope and operation of section 350(3) it is appropriate to keep in words of Justice Mahoney in Switzerland Insurance Workers’ Compensation (NSW) Ltd v Burley, Court of Appeal, No. 40408, 5 December 1996, unreported, at 18:
“Procedure in the Compensation Court is, in general, flexible and free from basic rigidities. This is as it should be: the Court is a specialist Court whose function is to deal with a large number of claims as expeditiously as may be. Its decisions are, in my opinion, to be given according to the law but with a regard to justice and merits appropriate to the nature of the social remedy which the legislation provides. Subject to observance of the specific statutory requirements, it should, in my opinion, exercise its jurisdiction in a beneficial manner and without undue emphasis upon technicalities.”
The above passage is in my view consistent with subsections (1), (2) and (3) of section 354 of the 1998 Act, which provide:
“354 Procedure before Commission
(1)Proceedings in any matter before the Commission are to be conducted with as little formality and technicality as the proper consideration of the matter permits.
(2)The Commission is not bound by the rules of evidence but may inform itself on any matter in such manner as the Commission thinks appropriate and as the proper consideration of the matter before the Commission permits.
(3)The Commission is to act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms.”
It is also consistent with the Commission’s objectives, which include the objective to provide a “fair and cost effective system for the resolution of disputes” (section 367(1)(a) of the 1998).
The Arbitrator erred in failing to reconsider all of the issues in this matter in light of the Appeal Panel MAC and this error requires that the reconsideration application be re-determined.
At the oral hearing of the appeal I invited the parties to make submissions on whether the matter should be re-determined by me or remitted to another Arbitrator. The Appellant Worker was content with either course but the Respondent Employer reserved its position. In all the circumstances of the matter, and having regard to the obvious credit issues thrown up by the evidence, I believe the most appropriate course is for the matter to be remitted to another Arbitrator for re-determination in accordance with the reasons and principles in this decision.
THE RE-DETERMINATION
The conduct of and procedure to be adopted at the re-determination will be a matter for the Arbitrator concerned. However, it is now three years since Mr Basit first filed his original Application in the Commission and it would seem appropriate in these circumstances that some updated evidence be given by him. This may include, but not necessarily be limited to, evidence of his pre-injury and post-injury condition. In fairness to the Respondent Employer, this may be a case where it is appropriate for Mr Basit to be cross-examined about his prior back symptoms and his work capacity in general. It will also be necessary for the original Arbitrator’s determination and findings as to the nature and extend of Mr Basit’s injury to be reconsidered and re-determined in the light of the Appeal Panel MAC. This will also include a reconsideration and re-determination of the original award for the Respondent Employer in respect of section 60 expenses, which I note were claimed (as a general order) in the original Application. I also note that Mr Basit filed a wage schedule in this matter on 19 July 2005 and that the Respondent Employer has not filed document disputing the figures in that schedule. I would not expect there to be any contest about wages at the re-determination.
It is time for this matter to move forward and be determined “according to its substantial merits” without inappropriate and unnecessary technical objections being taken.
EVIDENCE
Much discussion took place during the previous hearings about fresh evidence. For the avoidance of any further confusion the position is as follows:
(a)the MRI scan report of Mr Basit’s lumbar spine by Dr Carr dated 20 April 2004, showing a “mild diffuse disc bulge at the L4/5 level” is already in evidence and the Arbitrator erred in his second decision when he stated that Acting Deputy President Handley refused leave to admit this report on the basis that it added nothing to Mr Basit’s medical case (Reasons 19 February 2007, paragraph 28(3));
(b)Acting Deputy President Handley refused admission of a second MRI scan report of Mr Basit’s lumbar spine by Dr Carr (also dated 20 April 2004) showing no abnormality. It was this report that Acting Deputy President Handley held added nothing to Mr Basit’s medical case (see the first appeal 6 March 2006, paragraph 15). He also refused admission of the CT report of Dr Critoph dated 9 February 2006 for the same reason. Neither of these decisions has been challenged before me and these rulings stand. However the ruling in respect of Dr Critoph’s report is of little effect as the content of the CT scan is reproduced in Mr Mellick’s report which is in evidence;
(c)the Preplacement Health Evaluation undertaken for Haden before Mr Basit commenced employment was admitted as “fresh evidence” in the first appeal but Acting Deputy President Handley considered that little weight could be attached to Dr Hamid’s findings on examination (set out in that document) in relation to whether Mr Basit had a pre-existing back condition (the first appeal 6 March 2006, paragraph 27). The Arbitrator seems to have considered that as Acting Deputy President Handley had considered the document it was not “fresh evidence” and he therefore did not consider it in the reconsideration application (Reasons 19 February 2007, paragraph 29). Though this point has not been argued before me, I note that Acting Deputy President Handley’s ruling admitting the document as fresh evidence in the first appeal has not been challenged and remains valid. Therefore, the document is properly before the Commission for the purposes of the reconsideration application and it should be considered in the light of all the evidence in the case. Acting Deputy President Handley’s comments in respect of this document are of limited assistance as they were made before the Appeal Panel MAC became available and without the benefit of any relevant submissions by or on behalf of Mr Basit, who was unrepresented at that stage. It is obviously a relevant document and I expect that both parties will wish to make submissions about it. The Respondent Employer may also wish to cross-examine Mr Basit about its contents, and
(d)Mr Basit first sought to rely on the MRI scan of Dr O’Rourke dated 24 August 2006 in the reconsideration dealt with in the second arbitration. The Arbitrator held that the report was fresh evidence but would not have altered the result. Though it is not clear if this part of the Arbitrator’s ruling was formally challenged before Acting Deputy President Moore, she held that the ruling was open on the evidence (the second appeal 2 August 2007, paragraph 78). Therefore, this ruling stands unless there is further evidence that makes the MRI scan relevant to the issues to be decided in the remittal proceedings, in which event the admissibility of this report can be reconsidered by the Arbitrator.
DECISION
Paragraph one of the Arbitrator’s determination of 23 October 2007 is revoked and the following order made:
“The matter is remitted to a different Arbitrator to re-determine the Appellant Worker’s reconsideration application in accordance with the reasons and principles in this decision, and, if appropriate, to re-determine any entitlement/s he may have consequent upon that reconsideration.”
Paragraphs two, three and four of the Arbitrator’s determination of 23 October 2007 are confirmed.
COSTS
The Respondent Employer is to pay the Appellant Worker’s costs of the appeal.
Bill Roche
Deputy President
22 February 2008
I NING DONG CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF BILL ROCHE, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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