Beaumonts Beach House v Baldwin - [2012] NSWWCCPD 28

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		Beaumonts Beach House v Baldwin [2012] NSWWCCPD 28
APPELLANT:		Beaumonts Beach House
RESPONDENT:		Kathleen Baldwin
INSURER:		QBE Workers Compensation (NSW) Ltd
FILE NUMBER:		A1-9287/11
ARBITRATOR:	Ms F Robinson
DATE OF ARBITRATOR’S DECISION:		30 March 2012
DATE OF APPEAL DECISION:		30 May 2012
SUBJECT MATTER OF DECISION:		Procedural fairness; adequacy of reasons
PRESIDENTIAL MEMBER:		President Judge Keating
HEARING:		On the papers
REPRESENTATION:		Appellant:	Mulcahy Lawyers
Respondent:	Carroll & O’Dea Lawyers
ORDERS MADE ON APPEAL:		The Arbitrator’s determination of 30 March 2012 is revoked and the matter is remitted to another Arbitrator to determine afresh. Costs of the first and second arbitration are to follow the outcome of the next arbitration. No order as to costs of the appeal.

BACKGROUND

Ms Baldwin was employed by the appellant, Beaumonts Beach House, as a manager. Ms Baldwin alleges she suffered an injury to her back in the course of her employment on 30 November 2009, while packing books and records into her car.
QBE Workers Compensation (NSW) Ltd (QBE), the employer’s insurer, accepted liability and made payments of weekly compensation.
On 14 January 2011, QBE issued a notice under s 74 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) declining liability for further payments from 14 January 2011. QBE alleges that Ms Baldwin was no longer incapacitated as a result of the alleged injury.
On 22 July 2011, Carroll & O’Dea Lawyers, acting on behalf of Ms Baldwin, made a claim for lump sum compensation pursuant to s 66 of the Workers Compensation Act 1987 (the 1987 Act) in the sum of $16,170 in respect of an 11 per cent whole person impairment. A claim was also made for compensation under s 67 of the 1987 Act in the sum of $20,000. In addition, a claim was made for weekly benefits “for a closed period from the date she was terminated until the time she obtained an aged pension”. The precise dates of the claim were not particularised.
On 2 August 2011, QBE issued a further notice under s 74 of the 1998 Act. It declined the lump sum benefits and any liability for ongoing weekly payments, on the basis that:
“• you no longer suffer from an ‘injury’ as defined by s 4 of the 1998 Act;
• the injury you sustained on 28 January [sic, November] 2009 has not resulted in whole person impairment.”
On 18 October 2011, Ms Baldwin filed an Application to Resolve a Dispute in the Commission. She claimed weekly compensation from 14 January 2011 to 11 April 2011 in the sum of $1400 gross. She alleged that her injuries were as follows:
“Due to the nature and conditions of her employment involving lifting, bending and twisting, the applicant has suffered an injury to her lower back. The deemed date of injury will be the last day of employment, 28 November 2009 (see statements of applicant dated 29 April 2010, 6 May 2010 and 14 August 2011).”
No reply to the application was filed within 21 days from the date of the registration of the Application to Resolve a Dispute, as required by r 14.10 of the Workers Compensation Commission Rules 2011.
On 29 November 2011, the matter was listed for a telephone conference before a Commission Arbitrator. The respondent did not participate in the telephone conference and attempts to contact the insurer were unsuccessful. The matter was set down for a conciliation and arbitration hearing on 21 December 2011. The Commission’s records indicate that the matter was listed for hearing of a claim for weekly payments for a closed period from 14 January 2011 to 11 April 2011, a claim for medical expenses under s 60, and a claim for lump sum compensation under s 66.
On 5 December 2011, a notice was sent to QBE advising that the matter had been listed for a conciliation and arbitration hearing before an Arbitrator in the Commission’s premises at 1 Oxford Street, Darlinghurst on 21 December 2011 at 10.00 am. The notice indicated, among other things:
“The worker and their legal representative (if represented) must personally attend all Commission proceedings. The insurer and/or its representative must also attend.”
On 21 December 2011, the matter was listed for a conciliation and arbitration hearing before a Commission Arbitrator. The applicant was in attendance and was represented by counsel. There was no attendance by the respondent or its insurer. On the morning of the hearing, the Commission was contacted by telephone by a solicitor, Jonathan Harlen, of Mulcahy Lawyers, who are located at Lennox Head on the north coast of New South Wales. Mr Harlen sought to participate in the hearing by telephone. The Arbitrator declined the application and proceeded with the hearing in the absence of any legal representation for the employer. No reasons are recorded for the Arbitrator’s ruling. In the circumstances, Mr Harlen applied for an adjournment, which was also refused.
Ultimately, as the hearing unfolded, the Arbitrator determined that the dispute in respect of the claim for weekly compensation could not proceed and that issue was adjourned for hearing on Friday 2 March 2012. The transcript does not reveal the reasons for the adjournment.
As liability for the injury had been accepted, the Arbitrator determined that the claim for lump sum compensation pursuant to s 66 could be referred to the Registrar for referral to an Approved Medical Specialist, to determine if the worker was suffering from whole person impairment with respect to the injury to the lumbar spine and the extent of any impairment found.
On 17 February 2012, Ms Baldwin was assessed by Dr Oates, an Approved Medical Specialist. On 27 February 2012, Dr Oates issued a Medical Assessment Certificate. He certified that Ms Baldwin was suffering from a seven per cent whole person impairment relating to the injury to the lumbar spine.
On 24 February 2012, the appellant filed an Application to Admit Late Documents, which included a Reply to the Application to Resolve a Dispute. Part 3 of the Reply, “Matters in Dispute”, was left blank. Part 4, “Claim Details”, attached a wage schedule in respect of the period from 25 February 2011 to 11 April 2011.
On Friday 2 March 2012, the arbitration hearing was resumed before the same Commission Arbitrator. The Arbitrator confirmed that the claim before her was for weekly benefits during the period 14 January 2011 to 11 April 2011, for lump sum compensation pursuant to s 66, and an order in relation to the worker’s medical expenses.
The worker and her counsel were present. Mr Harlen, of Mulcahy Lawyers, again contacted the Commission and sought to participate in the arbitration hearing by telephone. The Arbitrator recorded that Mr Harlen was of the belief that the matter had been listed for hearing in Tweed Heads. In his submissions on appeal, Mr Harlen denies that this was his belief or that he stated this to Commission staff. The Arbitrator refused Mr Harlen’s request to participate in the hearing by telephone and the hearing proceeded in the absence of any representation for the employer.
During the course of the hearing, an application to amend the Application to Resolve a Dispute was made. The transcript records at T4.34:
“ARBITRATOR: … And I understand you, the Applicant, formally wants to make the – an Application to Amend the ARD?

MS DULHUNTY: Yes. To extend the closed period to the 14^th of March 2012, which is the date when the Applicant turns 65 years of age.”

Without any reference to the respondent/employer, the Arbitrator agreed to the application and ordered the Application to Resolve a Dispute be amended accordingly.

At T5.47, the Arbitrator gave a brief extempore decision. The Arbitrator noted that an Approved Medical Specialist had assessed the worker as suffering from a seven per cent whole person impairment. Given the worker’s age and the extent of her impairment, and the WorkCover medical certificates in support of her claim, the Arbitrator was satisfied that the applicant was unable to earn her pre-injury earnings, which exceeded $1400. Her ability to earn was assessed at zero, given the prospects of her obtaining employment on the open labour market. The Arbitrator awarded the worker payment under s 37 at the statutory rate from 14 January 2011 to 14 March 2012.
On 5 March 2012, the Arbitrator issued a Statement of Reasons – Extempore Orders and a Certificate of Determination in the following terms:
STATEMENT OF REASONS – EXTEMPORE ORDERS
“1. The applicant sustained a back injury on or about the 28 November 2009. The applicant claimed compensation. Liability was admitted and then subsequently declined by way of s 74 notice dated 2 August 2011. The applicant lodged an Application to Resolve a Dispute seeking orders in respect of weekly benefits, payment of medical and related expenses and lump sum payments pursuant to s 66 and s 67 of the Workers Compensation Act 1987.
2.    A telephone conference was held on the 29 November 2011. The respondent did not participate. The matter was scheduled fort [sic] a conference/arbitration on 21 December 2011. There was no personal attendance by, or on behalf of, the respondent. There was telephone contact, with the respondent, and an application to participate by telephone was declined.
3.    The respondent, in the notices dated 14 January 2011 and 2 August 2011, did not deny injury. Continuing incapacity and the need for ongoing treatment were in dispute.
4.    The claims for weekly benefits and payment of medical and related expenses were adjourned to 2 March 2012 and the claim for lump sum remitted to the registrar.
5.    Dr Chris Oates issued a Medical Assessment Certificate on 27 February 2012. The whole person impairment of the lumbar spine was assessed at 7%.
6.    There was no appearance by the Respondent at the conference/arbitration on 2 March 2012. A request to participate by telephone was declined. Counsel and an instructing solicitor represented the applicant.
7.    The arbitration commenced at 10.30 am. The applicant sought leave to amend the Application to Resolve a Dispute to claim weekly benefits from 14 January 2011 to 14 March 2012.
8. Orders were made in respect of the amendment to the Application to Resolve a Dispute, the admission of evidence, the claim pursuant to s 66 and the claims for weekly benefits and medical expenses.”
CERTIFICATE OF DETERMINATION
“1. The respondent to pay to the applicant the sum of $10,106.25 in respect of 7% whole person impairment of the lumbar spine due to injury on 28 November 2009 pursuant to s 66 of the Workers Compensation Act 1987.
2.    The Application to Resolve a Dispute is amended to claim weekly benefits of compensation from 14 January 2011 to 14 March 2012.
3. The respondent to pay to the applicant weekly benefits of compensation pursuant to s 37 of the Workers Compensation Act 1987 at the statutory rate for a worker without dependents [sic] as follows:
$409.10 per week for the period 14 January 2011 to 31 March 2011
$417.40 per week for the period 1 April 2011 to 30 September 2011
$424.50 per week for the period 1 October 2011 to 14 March 2012
4.    The respondent to pay the expenses incurred by the applicant pursuant to s 60 of the 1987 Act upon production of receipts/accounts/valid HIC charge.
5.    The respondent to pay the costs of the applicant as agreed or assessed.
6.    Pursuant to paragraph 9(2)(b) of Part A of the Workers Compensation Amendment (Costs) Regulation 2206 [sic, 2006] the arbitration on [sic] respect of the claim pursuant to s 66 on 21 December 2011 is to be treated as separate to the resolution of the claim for weekly benefits on 2 March 2012. This order only relates to the costs of the applicant.”
The Commission issued an amended Certificate of Determination on 30 March 2012 in the following terms in order to correct an error in the Certificate of Determination issued on 5 March 2012 relating to the orders concerning the s 66 claim:
“1. This matter was determined at arbitration on 2 March 2012. The claim pursuant to s 66 had previously been remitted to the Registrar for referral to an Approved Medical Specialist. Consequently the only issues for determination, on 2 March 2012, were the claim, by the applicant for payment of weekly benefits and medical and related expenses.
2. Accordingly, in the absence of consent, the applicant was not entitled to an order in respect of the claim pursuant to s 66 of the Workers Compensation Act 1987 (the 1987 Act).
3. The respondent did not consent to the order and in fact has lodged an appeal against the Medical Assessment Certificate.

4. Order (1) in the Certificate of Determination dated 5 March 2012 is ultra vires.

5. The orders, in respect of payment of weekly benefits and medical and related expenses, are:
ORDERS

1.The Application to Resolve a Dispute is amended to claim weekly benefits of compensation from 14 January 2011 to 14 March 2012.
2.The respondent to pay to the applicant weekly benefits of compensation pursuant to s 37 of the Workers Compensation Act 1987 at the statutory rate for a worker without dependents [sic] as follows:
$409.10 per week for the period 14 January 2011 to 31 March 2011
$417.40 per week for the period 1 April 2011 to 30 September 2011
$424.50 per week for the period 1 October 2011 to 14 March 2012
3.The respondent to pay the expenses incurred by the applicant pursuant to s 60 of the 1987 Act upon production of receipts/accounts/valid HIC charge.
4.The respondent to pay the costs of the applicant as agreed or assessed.

5.Pursuant to paragraph 9(2)(b) of Part A of the Workers Compensation Amendment (Costs) Regulation 2206 [sic, 2006] the arbitration on [sic] respect of the claim pursuant to s 66 on 21 December 2011 is to be treated as separate to the resolution of the claim for weekly benefits on 2 March 2012. This order only relates to the costs of the applicant.”

PRELIMINARY MATTERS

Section 352(3) is in the following terms:
“(3) There is no appeal under this section unless the amount of compensation at issue on the appeal is both:
(a)at least $5,000 (or such other amount as may be prescribed by the regulations), and
(b)at least 20% of the amount awarded in the decision appealed against.”
There is no dispute between the parties that the threshold requirements as to quantum and time, as found in the provisions of ss 352(3) and 352(4) of the 1998 Act, have been met.

ON THE PAPERS REVIEW

Section 354(6) of the 1998 Act provides:
“(6) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Both parties have submitted that the appeal can proceed on the papers, without a formal hearing.
Having regard to Practice Directions Nos 1 and 6, the documents that are before me, and the submissions by the parties that the appeal can proceed to be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed on the papers, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.

GROUNDS OF APPEAL

The appellant submits that the Arbitrator’s Orders 2, 3 and 6 are erroneous for the following reasons:
(a) In respect of Orders 2 and 3, the Arbitrator has failed to comply with the rules of procedural fairness/natural justice;
(b) In respect of Orders 2, 3 and 6, the Arbitrator failed to give adequate reasons for:
(i)allowing the worker to amend the Application to Resolve a Dispute to claim weekly benefits from 14 January 2011 to 14 March 2012;
(ii)determining the claim for weekly compensation in favour of the worker;
(iii)the costs orders in favour of the worker.

OPPOSITION TO THE APPEAL

The worker’s solicitors filed a Notice of Opposition to the Appeal Against the Decision of the Arbitrator. It outlined essentially two points of opposition. First, an amended application had been filed and served with respect to the period of the additional weekly compensation claimed, of which the employer had notice prior to the hearing. Secondly, the worker submitted that the Arbitrator had given adequate reasons, although there were no detailed references to the transcript or evidence to support the submission.
As the Commission’s file failed to reveal any evidence of an amended Application to Resolve a Dispute being filed, I convened a telephone conference between the parties on 23 May 2012. I was informed by the worker’s solicitor, Mr Ktenas, that the submission in respect of the amended application was made in error and that no such application had in fact been filed. I was informed that Mr Ktenas was instructed to withdraw all opposition to the appeal.

DISCUSSION

Procedural fairness

Proceedings in the Commission are governed by s 354 of the 1998 Act. Relevantly, s 354 provides as follows:
“(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.
(4)     …”
It is well settled, however, that, while this statutory provision modifies the common law rules of procedural fairness in some respects, it does not alter the fundamental rule that a party is entitled to be heard in relation to the case against it, before a decision-maker exercises the power to make a decision adverse to that party’s interests (Twist v Randwick Municipal Council [1976] HCA 58; 136 CLR 106 applied in Inghams Enterprises Pty Ltd v Zarb [2003] NSWWCCPD 15).
The obligation to accord procedural fairness requires that a party be given notice of the case that is put against him or her and a reasonable opportunity to put evidence and submissions before the tribunal concerning that case (New South Wales Police Force v Winter [2011] NSWCA 330 at 84).
These fundamental principles of procedural fairness were not applied by the Arbitrator in the circumstances of this case, for a number of reasons. At the commencement of the hearing, the Arbitrator correctly identified the issue before her, which was the dispute as to the worker’s entitlement to weekly compensation for a short, closed period between 14 January 2011 and 11 April 2011. The amendment at the final hearing permitted by the Arbitrator extended the period of the compensation claimed from 14 January 2011 to 14 March 2012. No notice of the proposed amendment had been given to the appellant. The amendment had not been foreshadowed in any of the correspondence in the lead-up to the hearing, and nor had the amendment been foreshadowed at the telephone conference on 29 November 2011, or at the first arbitration hearing on 21 December 2011.
Having excluded the appellant’s solicitor from participating in the final arbitration hearing by telephone, the appellant was excluded from any opportunity to put on any evidence or submissions on the amended claim for compensation before the Arbitrator entered an award in favour of the worker. This was a clear failure to apply the rules of procedural fairness and for that reason alone the appeal must succeed.

Reasons

Section 294 of the 1998 Act provides that, if a dispute is determined by the Commission, the Commission must as soon as practicable after the determination issue the parties with a Certificate of Determination supported by a brief Statement of Reasons for the determination.

Rule 15.6(1) of the Workers Compensation Commission Rules 2011 provides that the Commission’s reasons are to include:
(a)     The Commission’s finding on material questions of fact referring to the evidence or other material on which those findings were based, and
(b)     The Commission’s understanding of the applicable law, and
(c)     The reasoning process that led the Commission to the conclusions it made.

Rule 15.6(2) provides:
“Without limiting subrule (1), the reasons set out in a statement referred to in subrule (1) are to be stated sufficiently (in the opinion of the Commission) to make the parties aware of the Commission’s view of the case made by each of them.”
The failure to provide adequate reasons constitutes an error of law and may be a ground to set aside the Arbitrator’s decision. In Soulemezis v Dudley (Holdings) Pty Ltd (1987) 10 NSWLR 247, McHugh JA said at 280:
“If an obligation to give reasons for a decision exists its discharge does not require lengthy or elaborate reasons: Ex parte Powter; Re Powter (1945) 46 SR (NSW) 1 at 5; 63 WN 34 at 36. But it is necessary that the essential ground or grounds upon which the decision rests should be articulated.”
For the following reasons, the Arbitrator failed to discharge the statutory requirement to give reasons.
No reasons at all were given for refusing the application by the appellant’s solicitor to participate in the final arbitration hearing by telephone.
No reasons were given for proceeding to determine the claim for the additional weekly compensation referred to at [17] without notice of that claim having been given to the employer/insurer.
The dispute before the Arbitrator essentially concerned whether the worker’s continuing incapacity was due to an underlying congenital condition or whether it was due to the continuing effects of the accepted workplace injury. Both parties relied on expert medical evidence with respect to that issue. The Arbitrator made no attempt to reconcile the medical evidence or to give reasons why she preferred the respondent’s expert evidence over the appellant’s (Tyack formerly t/as Country Kidz v Cain [2007] NSWWCCPD 119 at [102]).
For the reasons given and in light of the lack of opposition to the orders sought, the appeal is allowed.

Other matters

Mr Harlen’s attempt on two occasions to represent his client’s interests at the arbitration hearings by telephone without any prior arrangement or consent of the Arbitrator concerned is quite unsatisfactory.
This decision should not be taken as condoning practitioners seeking to represent their clients’ interests at Commission hearings by telephone. On the contrary, practitioners are reminded that they are expected to appear in person at all Commission proceedings other than telephone conferences.

COSTS

In the event that the appeal is successful, both parties have submitted that no order should be made as to costs.

ORDERS

The Arbitrator’s determination of 30 March 2012 is revoked and the matter is remitted to another Arbitrator to determine afresh.
Costs of the first and second arbitration are to follow the outcome of the next arbitration.

No order as to costs of the appeal.

Judge Keating

President
30 May 2012

I, MARGOT UNDERCLIFFE, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF JUDGE KEATING, PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE