Cabra-Vale Ex-Servicemen's Club Ltd v Berkmann

[2006] NSWWCCPD 63

WORKERS COMPENSATION COMMISSION

APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR

CITATION:Cabra-Vale Ex-Servicemen’s Club Ltd v Berkmann [2006] NSWWCCPD 63

APPELLANT:  Cabra-Vale Ex-Servicemen’s Club Ltd

RESPONDENT:  Margaret Berkmann

INSURER:QBE Workers’ Compensation (NSW) Ltd

FILE NUMBER:  WCC 16298-04

DATE OF ARBITRATOR’S DECISION:          23 February 2005

DATE OF APPEAL DECISION:  20 April 2006

SUBJECT MATTER OF DECISION:                Adequacy of reasons, treatment of evidence

PRESIDENTIAL MEMBER:  Acting Deputy President Robin Handley

HEARING:On the papers

REPRESENTATION:  Appellant: Cambridge Integrated Services

Respondent: Whitelaw McDonald, Solicitors

ORDERS MADE ON APPEAL:  The decision of the Arbitrator is confirmed.

The Appellant, Cabra-Vale Ex-Servicemen’s Club Ltd, is to pay the Respondent, Ms Berkmann’s costs in this appeal.

BACKGROUND TO THE APPEAL

1. On 18 March 2005, Cabra-Vale Ex-Servicemen’s Club Ltd (‘the Club’) sought leave in the Workers Compensation Commission (‘the Commission’) to bring an appeal against the decision of an arbitrator dated 23 February 2005. The Club’s workers compensation insurer is QBE Workers’ Compensation (NSW) Ltd (‘QBE’).

1. The Respondent to the appeal is Margaret Berkmann. Ms Berkmann was born on 25 October 1947 and is aged 58. She is married with two adult children. Ms Berkmann worked as a poker machine attendant at the Club from 1985 to February 2001. Her work included various tasks requiring use of her thumbs, in particular, the counting of bank notes between thumb and index finger. Ms Berkmann claims that in the last two years of working for the Club, she began to develop pain and soreness around the base of her thumbs that would spread into her hands. On about 15 February 2001, she consulted her general practitioner, Dr S Mohan, about this and ceased work on 21 February 2001, when she notified the Club of her injury. Although later certified as fit for restricted duties, the Club informed her that there was no work available for her. In July 2001, she moved to the Central Coast.

1. Ms Berkmann lodged a claim for lump sum compensation in respect of an injury to both thumbs as a result of the nature and conditions of her employment from 1 January 1999 to 21 February 2001. On 12 December 2003, the Commission registered an agreement in respect of this claim pursuant to section 66A of the Workers Compensation Act 1987 (‘the 1987 Act’) to the effect that permanent impairment compensation was to be paid to Ms Berkmann in respect of a 10% permanent loss of efficient use of both thumbs, totalling $5,600.00. By letter dated 6 September 2004, Ms Berkmann’s solicitors made a claim on her behalf for the payment of weekly compensation from the Club.

1. On 12 October 2004, the Commission registered Ms Berkmann’s ‘Application to Resolve a Dispute’ in respect of her claim for weekly compensation from 31 May 2001 to date and continuing, and for medical, hospital, or related expenses. The Club’s ‘Reply’ was lodged on 21 October 2004. On 31 January 2005, the Arbitrator conducted a teleconference with the parties and, on 18 February 2005, conciliation having proved unsuccessful, he conducted an arbitration hearing. He gave an oral decision at the conclusion of the hearing, and his determination, in the terms set out below, was issued on 23 February 2005.

THE DECISION UNDER REVIEW

1. The Certificate of Determination, dated 23 February 2005, records the Arbitrator’s orders as follows:

“1. That the Respondent pay to the Applicant weekly benefits under Section 40 in the sum of $300.00 per week for the period 30 May 2001 to date and continuing.
2. That the Respondent pay the Applicant’s Section 60 expenses for treatment by Dr Mohan to an amount of $549.00 on production of accounts or receipts.
3. That the Respondent pay the Applicant’s costs as agreed or assessed.”

1. In the statement of reasons for his decision given orally at the conclusion of the hearing, the Arbitrator found that Ms Berkmann suffered injuries to her hands while undertaking bar and other general work for the Club. There was no dispute that she suffered a permanent disability to both thumbs assessed under section 66 of the 1987 Act as a 10% permanent loss of use of each of her thumbs. Ms Berkmann was paid appropriate compensation from 1 March 2001 until she ceased work on 29 March 2001, and the claim for weekly compensation is in respect of the period thereafter.

1. The Arbitrator said there was no dispute on the medical evidence that Ms Berkmann was incapacitated for the employment she undertook for the Club. However, at issue was her capacity for work from 30 May 2001 and her entitlement to weekly compensation. The Arbitrator found Ms Berkmann was not entitled to compensation under section 38 of the 1987 Act because, on the evidence, he was unable to find that Ms Berkmann had submitted medical certificates to the Club indicating the level of her incapacity. He therefore turned to consider her entitlement under section 40 of the 1987 Act.

1. The Arbitrator found Ms Berkmann’s pre-injury earning capacity was the $632.19 per week that she was earning in her employment with the Club. With regard to her post-injury capacity for work, the Arbitrator found (transcript page 25, lines 27-31) that Ms Berkmann’s disabilities:

“prevent her from doing certain work, particularly work that involves repetitive use of her hands and any lifting of her hands. The applicant’s been doing this sort of work for 20 years and isn’t trained or experienced in any other type of work.”

1. The Arbitrator found that Ms Berkmann’s work capacity was “significantly restricted”. He accepted that she might be able to get retail sales work in a position that did not involve repetitive use of the hands.

1. The Arbitrator found Ms Berkmann had a post-injury earning capacity of $250 per week. With regard to the exercise of the discretion in section 40(1), he found, on the one hand, that by reason of her age (58) and the disability affecting her hands, she would have difficulty finding employment. On the other hand, although she had initially sought to retrain - undertaking some technical courses in typing which caused her hands to hurt, she had not been actively looking for work. He calculated that by deducting the post-injury earning capacity ($250.00) from the pre-injury capacity ($632.19) gave a figure of $382.19 per week. He considered the appropriate figure to be $300 per week.

1. The Arbitrator also ordered the Club to pay Ms Berkmann’s general practitioner, Dr Mohan’s outstanding account amounting to $549, on production of accounts or receipts.

ISSUES IN DISPUTE

1. The grounds of appeal identified by the Club are that the Arbitrator failed to give any proper or adequate reasons for his findings in respect of the amount Ms Berkmann would be able to earn in suitable employment, and as to the exercise of the discretion required by section 40(1) of the 1987 Act. Moreover, the Arbitrator failed to properly exercise that discretion, and his findings concerning Ms Berkmann’s incapacity were inconsistent with the prior award for permanent loss of efficient use of each thumb. These grounds and the parties’ submissions are discussed more fully below.

ON THE PAPERS REVIEW

1. Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’) states:

“(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.”

1. I have had regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submissions of the parties on the appeal. The Club submits there should be an oral hearing because the grounds of appeal include a challenge to the Arbitrator’s findings on essential issues and to the weight accorded to the evidence, involving consideration of “a substantial amount of relevant detail in the medical evidence” particularly with regard to the issue of capacity for work, and such matters are best dealt with by way of oral hearing. Ms Berkmann’s solicitors submit that the appeal can appropriately be dealt with on the papers and oral submissions are not necessary. Having considered these submissions and the relevant 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.

1. Neither party sought to adduce fresh evidence.  

LEAVE

1. Before proceeding to deal with an appeal, the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act. The appeal was lodged within 28 days of the issue of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act. With regard to section 352(2), I accept that the amount of weekly compensation at issue exceeds $5,000 and represents more than 20% of the amount awarded. I am therefore satisfied that the section 352 threshold has been met, and I grant leave to appeal.

SUBMISSIONS, DISCUSSION AND FINDINGS

1. The role of the Presidential Member on appeal is to review the Arbitrator’s decision as a whole. The review is not a rehearing. In this case, the Club must demonstrate that the decision of the Arbitrator is affected by some legal, factual or discretionary error (Allesch v Maunz (2000) 203 CLR 172; The King Island Company Limited v Deery [2005] NSW WCC PD 1) in order to enliven the Presidential Member’s power to interfere with the Arbitrator’s decision pursuant to section 352(7) of the 1998 Act. Where the weight accorded to the evidence by the Arbitrator is challenged, Deputy President Fleming’s comment in Knight v Eyles Nominees Pty Ltd [2004] NSW WCC PD 73 at paragraph 40 should be borne in mind:

“Interference with an Arbitrator’s discretionary judgement as to the weight of evidence should only be done where it is manifestly obvious that the discretion has so miscarried that it has not been exercised fairly and lawfully.”

Capacity to earn in suitable employment

1. The Club submits the Arbitrator failed to give any proper or adequate reasons in respect of the amount Ms Berkmann would be able to earn in suitable employment as defined in section 40(2)(b) of the 1987 Act. The Club contends the Arbitrator did not define the category of work that Ms Berkmann is capable of undertaking with any precision and did not specify the hours during which she was capable of undertaking suitable work. There was no evidence before the Arbitrator that Ms Berkmann was restricted in the number of hours she could work by reason of her incapacity. Thus, the Arbitrator’s finding that Ms Berkmann had a capacity of only $250 per week is untenable given the average minimum weekly wage of $470 per week. The Club submits Ms Berkmann has a full-time ability to work in sales that would reflect a much greater earning capacity than the $250 per week found by the Arbitrator.

1. Ms Berkmann’s solicitors note the Arbitrator found there was consensus in the medical evidence that Ms Berkmann’s disabilities prevented her from doing certain work (transcript page 25, lines 26-27) with the result that the work she can do is unskilled work “where there is little or no use of her hands” (transcript page 25, lines 34-35). The Arbitrator concluded that Ms Berkmann’s work capacity is “significantly restricted” (transcript page 25, line 47) and “extremely limited” (transcript page 25, line 52). These factors were taken into account in determining an entitlement pursuant to section 40 which reflected her clearly diminished capacity on the open market.

1. Ms Berkmann’s solicitors also refer to the work capacity report completed by Chere McCarnley, Rehabilitation Consultant, on 26 November 2002. Ms McCarnley opined that Ms Berkmann can work up to 30 hours a week, but with restrictions placed on the types of duties and a return to work in a “supported environment” and “with rest breaks and pacing”. It should also be noted that Dr RL Plowman, Surgeon, in a report dated 15 May 2003, opined that Ms Berkmann was unfit for work that requires “heavy, prolonged and repetitive use of the thumbs and hands”, and that Dr Mohan, in a report dated 19 July 2004, opined that because Ms Berkmann “is not going to get better and as she has no formal education or skills she wouldn’t be able to find full employment”. On the basis of the medical evidence before him, the Arbitrator was entitled to infer that Ms Berkmann was unfit for full-time work on the open labour market.

1. In my view, the Arbitrator sufficiently described the unskilled work that Ms Berkmann would be able to undertake – not involving any repetitive use of her hands or involving any lifting, and his finding in this regard was supported by medical evidence and by the evidence as to Ms Berkmann’s education and work experience. As Ms Berkmann’s solicitors point out, there was also evidence from the Rehabilitation Consultant, Ms McCarnley, to support a finding that Ms Berkmann would be capable of working up to 30 hours a week in a supported environment. Thus, there was evidence to support the Arbitrator’s finding that Ms Berkmann’s “work capacity is significantly restricted” (transcript page 25, line 47) with the result that her post-injury capacity to earn was $250 per week. I am therefore not satisfied that the Arbitrator made any error in so finding, and I am satisfied that he gave adequate reasons for doing so in terms of his obligation under section 294(2) of the 1998 Act and Rule 73 of the Workers Compensation Commission Rules 2003. Moreover, there is nothing to indicate that the Arbitrator “failed to exercise his duty to fairly and lawfully determine the application” (Mayne Health Group t/as Nepean Private Hospital v Sarah Sandford [2002] NSW WCC PD 6 at paragraph 48).

Exercise of the discretion in section 40(1)

1. The Club submits that it is not clear what the Arbitrator meant by stating that Ms Berkmann’s concession in cross-examination that she had not looked for jobs for the previous two years “cuts both ways”. It submits this reflected poorly on her, and the Arbitrator’s exercise of the discretion in section 40(1) to reduce the award by only approximately 20% was inadequate.

1. Ms Berkmann’s solicitors submit that the Arbitrator gave proper and adequate reasons for exercising his discretion, taking into account that Ms Berkmann had ceased looking for work, but weighing against this factors such as her age, limited experience and opportunity to find work. These were appropriate factors to consider in the circumstances and there was no failure in the exercise of his discretion.

1. In my view, it is clear from the Arbitrator’s oral statement of reasons that while he recognised Ms Berkmann had not applied for work for the last two years, he also took into account that she had initially sought to retrain by undertaking some “technical courses in typing and found that her hands hurt” (transcript page 26, lines 13-14), and the difficulty of finding work for a person of Ms Berkmann’s age and experience, restricted by a disability affecting their hands. I am therefore not satisfied that the Arbitrator erred in the exercise of his discretion under section 40(1) of the 1987 Act.

Findings inconsistent with section 66 award

1. The Club submits the Arbitrator’s implied acceptance of Ms Berkmann’s representative’s presentation of her case suggesting that her hands were ‘useless’, is inconsistent with the 10% permanent loss of efficient use of each thumb (rather than with respect to each hand) accepted and binding on the parties as a result of the section 66A agreement.

1. Ms Berkmann’s solicitors note that a worker may have a significant incapacity for employment without any entitlement to compensation for permanent loss. The section 66 assessment relates only to permanent loss of a specified body part. Ms Berkmann’s complaints are not limited to the thumbs but include complaints of hand and wrist pain and disability. The type of disability suffered by the worker is relevant in considering various employment scenarios. The Arbitrator found that Ms Berkmann was only fit for “unskilled work where there is little or no use of the hands” (transcript page 25, lines 34-35). Ms Berkmann’s solicitors submit that in the context of her “age, experience, and qualifications this disability must equate to a significant restriction on the worker’s capacity”.

1. In my view, there was evidence before the Arbitrator to support his finding that Ms Berkmann was significantly restricted in the unskilled work she could undertake by reason of restrictions on the repetitive use of her hands and on lifting. I note that an assessment of permanent impairment under section 66 of the 1987 Act “is an objective one ... in the sense that no account is taken of the effect that the permanent disability has on the worker in his of her work”: Lovett Building Co Pty Ltd v Burns (1993) 29 NSWLR 475 at 484-485. I am not therefore satisfied that the Club has established any error by the Arbitrator as alleged under this head.

DECISION

1. In conclusion, the Club not having established any legal, factual or discretionary error by the Arbitrator, the decision under review must be confirmed.

COSTS

1. The Appellant, Cabra-Vale Ex-Servicemen’s Club Ltd, is to pay the Respondent, Ms Berkmann’s costs in this appeal.

Robin Handley

Acting Deputy President  

20 April 2006

I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF ROBIN HANDLEY, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

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