BHP Billiton Limited v Leon
[2006] NSWWCCPD 158
•20 July 2006
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE REGISTRAR IN RELATION TO COSTS
CITATION:BHP Billiton Limited v Leon [2006] NSWWCCPD 158
APPELLANT: BHP Billiton Limited
RESPONDENT: Joseph Leon
INSURER:BHP Billiton Limited (self insurer)
FILE NUMBER: WCC11158-04
DATE OF REGISTRAR’S DECISION: 25 May 2005
DATE OF APPEAL DECISION: 20 July 2006
SUBJECT MATTER OF DECISION: General order for section 60 expenses pursuant to the Workers Compensation Act 1987; Application of Clause 8 of Schedule 6 of the Workers Compensation Regulation 2003.
PRESIDENTIAL MEMBER: Acting Deputy President Deborah Moore
HEARING:On the papers
REPRESENTATION: Appellant: Spark Helmore
Respondent: Whitelaw McDonald
ORDERS MADE ON APPEAL: 1. The decision of the Registrar dated 25
May 2005 is confirmed.
2. The Appellant is to pay the costs of the appeal.
BACKGROUND TO THE APPEAL
On 1 June 2005, BHP Billiton Limited (‘the Appellant’) filed an appeal against the Registrar’s Assessment of Costs in relation to proceedings previously determined by a Commission Arbitrator.
The Respondent to the appeal is Joseph Leon (‘the Respondent’). The relevant workers compensation insurer is BHP Billiton Limited as self-insurer (‘the self-insurer’).
The appeal was served on the Respondent on 9 June 2005. On 21 June 2005, the Respondent filed a ‘Notice of Opposition to the Appeal’. On or about 24 June 2005, the Appellant filed further submissions in respect of the appeal and requested a copy of the transcript of the proceedings before the Arbitrator at first instance in order to clarify the Arbitrator’s reasons.
The transcript was obtained and a copy served on the Respondent by the Appellant on 18 July 2005. No further submissions have been filed by either party since that time.
The Registrar’s decision (by her delegate, a Commission Arbitrator) made on 25 May 2005 is as follows:
“1. Pursuant to an Agreement and Order dated 12 November 2004, the Applicant employer is liable to pay the Respondent worker’s costs of the Application as agreed or assessed.
2. The Respondent’s costs of the proceedings assessed in the sum of $3797.75 (inclusive of GST) are determined as fair and reasonable.
3. The Applicant’s costs of the assessment (inclusive of GST) are not allowed.
4. The Applicant is to pay the amount of $3,797.75 to the Respondent if those costs have not already been paid.”
In making an ‘Assessment of Costs’, the Registrar determined that Clause 8 of Schedule 6 of the Workers Compensation Regulation 2003 (‘the Regulation’) did not apply.
The Arbitrator’s award at first instance was as follows:
“1. That the Respondent pay the Applicant’s costs as agreed or assessed.
2. That the Respondent pay the Applicant’s s.60 of the Workers Compensation Act 1987 expenses for digital hearing aids up to the sum of $5,500.00 on production of accounts or receipts.”
The Appellant submits that the Registrar has made an error of law in the determination and has misinterpreted the application of Clause 8 of Schedule 6 of the Regulation in that the Registrar found that Clause 8 relates to claims where the amount in dispute (my emphasis) is less than $1000.00.
The Appellant submits that this interpretation is incorrect in that the amount in dispute is irrelevant since it is the “final award or settlement that is determinative.” The Appellant submits that as the Respondent had not purchased hearing aids at the time of the initial arbitration hearing, it was beyond the power of the Commission to order an amount for section 60 expenses. The Appellant submits that the Registrar erred in finding that the Arbitrator’s award was a ‘final order’ for section 60 expenses of $5,500.00.
The Appellant submits that the order made by the Arbitrator at first instance was a general order only and that Clause 8 is applicable to any claim involving a general order for section 60 expenses, “… as any such order does not satisfy the requirement for a verdict or settlement of $1000.00 or more pursuant to Clause 8.”
The Respondent submits that the Arbitrator’s order was not ‘general’ and was made “… with a specific expense in mind, namely … $5,500.00”, and that “… at no stage in the proceedings before the Arbitrator [at first instance] was the amount claimed under section 60 ever in dispute.”
ON THE PAPERS REVIEW
The Appellant submits that the matter is suitable for a determination ‘on the papers’. The Respondent is silent on this point.
I have before me the Commission files in both the substantive matter and the cost dispute together with the parties’ submissions and the transcript.
Having carefully read this material, I am satisfied that I have sufficient information to proceed ‘on the papers’ in accordance with the provisions of section 354 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) and that this is the appropriate course in the circumstances.
THE GROUNDS OF APPEAL
These have been summarised to some extent in the preceding paragraphs. In essence, the Appellant submits that Clause 8 of Schedule 6 is applicable to any claim involving a general order for section 60 expenses as any such order cannot be said to satisfy the requirement for a final verdict or settlement of $1000.00 or more.
THE RELEVANT LAW
Clause 8 of Schedule 6 of the Regulation provides as follows:
“Despite any other provision of the Schedule, if a medical dispute or a dispute about weekly payments of compensation is finalised by an agreement for payment of an amount less than $1000.00, or an award for payment of an amount less than $1000.00, the maximum amount of costs for the dispute is $200.00.”
THE SUBMISSIONS AND FINDINGS
As the Appellant rightly points out, “… section 60 expenses must be incurred before payment can be ordered in respect of same. (Water Taxis Combined Pty Limited and Harbour Taxi Boats Pty Limited v Wells [2004] NSWWCCPD 30) (‘Wells’ case’).”
The only order that can be made by the Commission is a ‘general order’ where no expenses have yet been incurred. Section 60 is in effect an indemnity provision.
It is also fair to say that the Registrar’s finding at paragraph 13 of the ‘Statement of Reasons’ that “in this case the final order was for section 60 Expenses of $5,500.00” was incorrect: The Arbitrator’s award at first instance was for payment “… up to the sum of $5,500.00”.
The issue however is the interpretation of Clause 8 of the Regulation.
The Appellant interprets that section as being applicable to any claim involving a general order for section 60 expenses on the basis that, as I understand it, no amount has been determined as ‘final’, or alternatively, the ‘final’ amount is unspecified, such that the amount awarded is effectively ‘zero’ and falls within the scope of Clause 8.
The Respondent however submits that in this particular case, the only evidence before the Arbitrator as to the costs of hearing aids was the sum of $5,500.00 such that the Arbitrator’s determination “… was worded so as to take effect when the expense of $5,500.00 was incurred and at the point the invoice was presented to the Respondent for payment it was obligated to make payment …”
Examination of the transcript is useful at this point. There was no real issue between the parties other than whether or not the Respondent’s claim for digital hearing aids costing $5,500.00 was reasonable. Prior proceedings had determined the issue of ‘injury’ by way of hearing loss, and the Respondent had previously been provided with hearing aids. These, he claimed, were no longer effective and thus he sought the cost of digital aids. After examining the evidence, the Arbitrator concluded at page 20 of the transcript, “I have to consider the evidence that I have before me, and there is no evidence that says that these hearing aids would not help.”
When examining the Appellant’s evidence, the Arbitrator stated, also at page 20, “There are no expert medical or other reports which conflict with the evidence given by Hearing Life, Dr Hopkins and Mr Leon. Therefore, I would accept that evidence which is before me.” That evidence was to the effect that digital hearing aids costing $5,500.00 were appropriate.
At page 21, the Arbitrator correctly identified her task was “… to look at the issue of whether the provision of these hearing aids … at a cost of $5,500.00 is reasonably necessary”.
Summarising the issues at pages 22 and 23, the Arbitrator stated:
“… I need to decide … whether this particular hearing aid which is being sought is reasonably necessary … Is it appropriate? The medical evidence says, and I can only rely on what’s there, that the 100% digital hearing aids would help to differentiate sounds … so that seems to be the best evidence about the effect of these particular hearing aids. There is not any evidence that these hearing aids are not appropriate… so I would have to say that it certainly seems as though digital hearing aids, based on that evidence from Susan Buckland, were certainly appropriate. There is no evidence that this type of hearing aid would not work for Mr Leon. So I would have to accept that they’re appropriate … now there isn’t any evidence really about any other alternatives, only the ones that he had and these new digital ones …”
In other words, the evidence accepted by the Arbitrator was that digital hearing aids, quoted at a cost of $5,500.00, were appropriate.
The question of costs was addressed by the Arbitrator at pages 23 and 24. At page 23, she stated “The next issue is one of cost. The digital hearing aids, as claimed, are $5,500.00, which is a reasonably substantial cost.”
The solicitor for the Appellant replied “… If you propose to make an order in the Applicant’s favour, then a general order in respect of the provision of hearing aids would probably assist both parties. It would certainly allow my client to go out and arrange for the fitting and provision of hearing aids, digital hearing aids, and its noted in our reply that they vary in price significantly between providers …”
It was noted that there was evidence of digital hearing aids being available for around $2,250.00.
The Arbitrator then said:
“We have got a cost of $5,500.00. Even thought there is a Tax Invoice for a lesser amount, it is dated 2003, and the Applicant stated that they were relying on the amount in their application … and that’s $5,500.00.
Now that deals with the issue of cost… However, I also have to consider the benefit that that’s going to give to the Applicant …”
The Arbitrator concluded:
“…The potential effectiveness of the digital hearing aid is not outweighed by the cost. In other words, the cost is appropriate in that it provides a significantly better level of hearing based on the evidence that I have … so the cost alone would not prevent this Applicant succeeding in their claim … Therefore, I do find that the provision of a digital hearing aid for the Applicant is reasonably necessary under section 60.”
All this evidence lends weight to the Respondent’s submission that “… the intended meaning of the order …” was in the sum of $5,500.00. However, as President Justice Sheehan said in Well’s case “An Arbitrator therefore does not have the power to make an order for the specified payment of medical expenses based upon an estimate of the likely future costs. An Arbitrator is entitled to find that an employer is liable to pay a worker for medical or related treatment including future medical treatment … an employer however will not be liable to pay the worker’s section 60 expenses until they have been incurred and properly verified.”
Thus it may be said in this particular case, the Arbitrator determined that the Appellant was liable to pay the Respondent for the cost of digital hearing aids when that cost was incurred.
The Arbitrator’s award appears to reflect this proposition, i.e., that the sum of $5,500.00 would be payable by the Appellant when it was incurred by the Respondent.
It is also worth noting the Appellant’s solicitor’s correspondence to the Respondent’s solicitors dated 25 January 2005 that:
“Consistent with previous correspondence, our client has offered to supply digital hearing aids to your client, supplied by Hunter Hearing, which was the quotation you relied upon in the worker’s original proceedings. Currently this quote is in the sum of $3,150.00.”
Indeed, in its ‘Reply’ the Appellant listed the issues in dispute as including:
“… If it is determined that the Respondent is to pay the costs of a new set of hearing aids (for which liability is denied) then the amount claimed in the sum of $5,500.00 is excessive for hearing aids and the Respondent submits that the initial quote of $2,700.00 would be more appropriate”.
In other words, there seems to be a clear understanding between the parties that the ultimate expense or ‘amount in dispute’ would certainly exceed $1000.00.
However, as the Appellant rightly points out, the ‘amount in dispute’ is not relevant to the application of Clause 8: it is the final ‘award or settlement’ that is relevant.
This being said, Clause 8 can equally be interpreted as being applicable only where a dispute is “… finalised by an agreement [or award] for payment of an amount less than $1000.00 …”
On this basis, in the present case, no ‘final’ order or award in monetary terms has been reached, notwithstanding the Arbitrator’s apparent ‘resolution’ of the dispute between the parties. That dispute, as I have said, was essentially as to whether or not digital hearing aids were “reasonably necessary” within the meaning of section 60 of the 1987 Act.
It follows that it cannot be said that the amount “finalised’ was in fact less than $1000.00, or indeed $5,500.00 for that matter. The ‘final award or settlement’ was effectively an unspecified sum.
On that basis, in my view Clause 8 is not applicable to the present case.
CONCLUSION
The Arbitrator’s award at first instance did not reflect a ‘finalised agreement or award’ such as to invoke the provisions of Clause 8 of Schedule 6.
DECISION
The decision of the Registrar dated 25 May 2005 is confirmed.
COSTS
The Appellant is to pay the costs of the appeal.
Deborah Moore
Acting Deputy President
20 July 2006
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF DEBORAH MOORE, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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