GUMMOW ACJ, KIRBY, CALLINAN, HEYDON AND CRENNAN JJ
KENNETH CANUTE APPELLANT
AND
COMCARE RESPONDENT
Canute v Comcare [2006] HCA 47 28 September 2006 S154/2006
ORDER
1.Appeal allowed with costs.
2.Set aside the orders of the Full Court of the Federal Court of Australia made on 16 December 2005, and in their place order that:
(a) Order 1 made by Hill J on 1 April 2005 be varied so that it reads:
1.The decision of the Administrative Appeals Tribunal dated 21 June 2004 be set aside and in place thereof direct that Comcare determine an amount payable to the Applicant assessed under ss 24 and 27 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) in respect of an injury, being an adjustment disorder with anxious and depressed mood resulting in a degree of permanent impairment of the Applicant of 10 per cent as assessed pursuant to Table 5.1 of the Guide.
(b)Appeal otherwise dismissed with costs.
On appeal from the Federal Court of Australia
Representation
L T Grey with J P Mrsic for the appellant (instructed by Carroll & O'Dea)
P J Hanks QC with B H J Dube for the respondent (instructed by Phillips Fox Lawyers)
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
CATCHWORDS
Canute v Comcare
Workers compensation − Injury and impairment − Liability of Comcare to pay compensation in respect of an injury which results in a permanent impairment pursuant to s 24 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) ("the Act") − Where Comcare required to determined the degree of permanent impairment resulting from an injury under the approved Guide − Where s 25(4) of the Act provides that no further compensation payable in respect of a subsequent increase of less than 10 percent in the degree of impairment where Comcare has made a final assessment of the degree of permanent impairment of the employee − Where the worker sustained a physical injury to the back and also a mental injury being a post traumatic stress disorder − Where the mental injury manifested itself later in time than the physical injury − Whether s 25(4) of the Act precluded Comcare from being liable to pay compensation in respect of the mental injury because it resulted in an increase of less than 10 percent in the degree of impairment of the employee.
Statute − Statutory construction − Whether repugnancy arises between s 24 and s 25(4) of the Act in circumstances where something is both an injury and produces a subsequent increase in the degree of permanent impairment of the employee.
GUMMOW ACJ, KIRBY, CALLINAN, HEYDON AND CRENNAN JJ. This appeal from the Full Court of the Federal Court (French and Stone JJ; Gyles J dissenting)[1] raises a question of the construction and application of Div 4 of Pt II of the Safety, Rehabilitation…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
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AGLC
Canute v Comcare [2006] HCA 47
Case
[2006] HCA 47
Decision Date
CaseChat Overview and Summary
The High Court of Australia heard an appeal from Comcare concerning the appellant's entitlement to compensation for a permanent impairment. The appellant had sustained a physical back injury in the course of his employment, for which Comcare accepted liability and made an initial award of compensation based on a 12% whole person impairment. Subsequently, the appellant developed a mental injury, an adjustment disorder with anxious and depressed mood, which manifested later than the physical injury. Comcare denied further compensation for this mental injury, asserting that it did not represent an increase of at least 10% in the degree of permanent impairment, as required by section 25(4) of the *Safety, Rehabilitation and Compensation Act 1988* (Cth).
The central legal issue before the High Court was whether section 25(4) of the Act precluded Comcare from being liable to pay compensation in respect of the appellant's mental injury, which was diagnosed after the initial assessment of his physical injury. This involved determining whether the mental injury constituted a separate "injury" for the purposes of the Act, and how section 25(4), which deals with subsequent increases in impairment, interacted with section 24, which governs compensation for permanent impairment. The Court also considered whether a potential repugnancy arose between these sections if a condition could be both a distinct injury and a subsequent increase in impairment.
The High Court, allowing the appeal, reasoned that the Act requires Comcare to determine compensation by reference to each distinct "injury". The appellant's adjustment disorder was an "injury" in its own right, distinct from the initial back injury. Therefore, section 24 of the Act was applicable to this new injury, requiring Comcare to assess the degree of permanent impairment resulting from it. The Court found that section 25(4) was not intended to prevent compensation for a new and distinct injury that arises after an initial assessment, but rather to address subsequent increases in the degree of impairment from an already assessed injury. The majority of the Full Court had erred in treating the adjustment disorder as merely a consequential increase in impairment rather than a separate injury.
Consequently, the High Court allowed the appeal, set aside the orders of the Full Court, and varied the orders of Hill J. The matter was remitted to Comcare to determine an amount payable to the appellant assessed under sections 24 and 27 of the Act in respect of the adjustment disorder, resulting in a 10% degree of permanent impairment.
Orders
Orders of the court
1. Appeal allowed with costs. 2. Set aside the orders of the Full Court of the Federal Court of Australia made on 16 December 2005, and in their place order that: (a) Order 1 made by Hill J on 1 April 2005 be varied so that it reads: 1. The decision of the Administrative Appeals Tribunal dated 21 June 2004 be set aside and in place thereof direct that Comcare determine an amount payable to the Applicant assessed under ss 24 and 27 of the Safety, Rehabilitation and Compensation Act 1988 (Cth) in respect of an injury, being an adjustment disorder with anxious and depressed mood resulting in a degree of permanent impairment of the Applicant of 10 per cent as assessed pursuant to Table 5.1 of the Guide. (b) Appeal otherwise dismissed with costs.
Background
Background to the litigation
Sub‑sections (4) and (5) of s 25 do not immediately affect the scheme of interim payment of compensation provided for by s 25. They speak in terms of a "final assessment of the degree of permanent impairment of an employee", implicitly referring to the determination required to be made by Comcare under s 24(5) of the Act, which, it again is to be emphasised, is to be performed with reference to "an injury". For this reason, all the members of the Full Court regarded s 25(4) as a rider, qualifying s 24[7], and in a sense this is correct.[7](2005) 148 FCR 232 at 252, 253.The facts The facts relevant for the purposes of this appeal are undisputed and fall into quite a narrow compass. The appellant was born in 1957 and was employed by the Department of Defence as a civilian contractor engaged in cleaning and maintenance duties. He injured his back in the course of his employment on 19 February 1997 and again on 7 September 1998. The appellant was unfit for work for approximately three weeks following the first incident, and for two years following the second incident. On 4 November 1998, the appellant lodged a claim for rehabilitation and compensation with Comcare, citing the second incident as the occasion of his injury. Comcare allowed his claim on the basis that he had sustained work-related "aggravation of displacement of intervertebral disc‑lumbar sustained on 7/9/1998". Comcare accepted liability up to and including 7 June 1999, and told the appellant that further medical evidence would be required to support a claim for compensation beyond that date. On 14 September 1999, the appellant lodged with Comcare a claim for permanent injury compensation. On this form the appellant's doctor recorded a diagnosis of his condition as "L5/S1 spondylolisthesis", and described his impairment as "[c]hronic severe back pain radiates down (R) leg". The assessing medical practitioner, Dr Lewington, assessed the appellant as having a 15 per cent whole person impairment with respect to his back injury and a 10 per cent whole person impairment with respect to his right leg. However, he assessed that 50 per cent of the appellant's condition was attributable to a condition pre‑existing the work injuries. Accordingly, by letter dated 9 February 2000, Comcare made "an award of 12% whole person impairment" under s 24 of the Act, based upon the Combined Values Chart in the Guide. This amounted to $13,731.28. Comcare also awarded the appellant $15,876.80 for non‑economic loss under s 27 of the Act. On 4 July 2002, the appellant lodged a second claim for permanent injury compensation. This form, which was lodged after the appellant had been referred to a psychiatrist, recorded a diagnosis of "1) L5/S1 spondylolisthesis" and "2) Adjustment disorder with depression" and described the impairment as "1) chronic severe low back pain" and "2) ongoing depression". By letter dated 29 September 2002, Comcare denied liability on the basis that the appellant had not shown an increase in whole person impairment of at least 10 per cent, as required by s 25(4) of the Act. An internal reconsideration within Comcare requested by the appellant affirmed that decision. The AAT decision
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
GUMMOW ACJ, KIRBY, CALLINAN, HEYDON AND CRENNAN JJ
(dissent)
Hill J concluded that it would be wrong to treat two separate injuries, each having different impairments, as one injury for the purposes of the Act, because[10]:"[t]he measure of compensation is determined by reference to percentage impairment. However, the right to compensation is created by the occurrence of an injury."His Honour concluded that the AAT had fallen into error because it characterised the adjustment disorder merely as "psychological sequelae" of the back injury, without considering whether it itself was "an injury".[10](2005) 40 AAR 327 at 336.The Full Court judgment On appeal to the Full Court, the majority (French and Stone JJ) held that, while the AAT had erred, it had come to the right result. The error identified by the majority was not the same as that identified by Hill J. The majority acknowledged that the adjustment disorder was "plainly" an injury for the purposes of the Act[11]. For the majority, the error by the AAT was in assuming that an injury which is consequential upon a compensable injury is necessarily to be treated as an increase in the level of impairment attributable to that injury without addressing the relevant question; this was whether the adjustment disorder was an "impairment". Having posed that question, the majority answered it affirmatively and supported the application by the AAT of s 25(4). [11](2005) 148 FCR 232 at 234. In his dissenting reasons, Gyles J endorsed the reasons of Hill J and added some reasons of his own. His Honour essentially was of the view that there was no ground for not applying s 24 to the psychiatric injury, given it was "an injury" for the purposes of the Act, and that, on its proper construction, s 25(4) could not affect this conclusion.The submissions on appeal On appeal to this Court, the appellant supported the reasoning of Hill J and of Gyles J that the Act requires Comcare to determine separately the impairments arising from each injury. The appellant submitted that, since the adjustment disorder was "an injury" resulting in a separate impairment, s 24 should have been applied and that should have been the end of the inquiry. Given the primacy of the concept of "injury" within the compensatory scheme, the terms of the Act mandate the operation of s 24 in respect of that "injury", in the manner for which the appellant contends. Such an outcome has both logic and simplicity to commend it. Where something is "an injury", why should not the quantum of compensation payable in respect of it be determined in the same manner for that "injury" as for any other? The effect of the reasoning of the majority in the Full Court, supported by Comcare on this appeal, denies that outcome. The reasoning must be examined, resulting as it does in disapplying s 24 (and indeed s 14(1)) of the Act to something which, on its face, is within the terms of that section. As previously indicated, the Full Court majority found error in the AAT having proceeded on the basis that an injury which is consequential upon a compensable injury is necessarily to be treated as an increase in the level of impairment attributable to that injury without addressing the relevant question of whether the adjustment disorder was an "impairment"[12]. The manner in which the majority put what they saw as the relevant question was inaccurate, because it departed from the terms of s 25(4). That paragraph does not inquire as to whether there is a new "impairment" resulting from the previous injury; it inquires as to whether there has been a "subsequent increase in the degree of impairment [that is, permanent impairment of an employee]". That question can only be answered by reference to the Guide (s 25(4)). In practice, and in circumstances such as those that obtain here, the occurrence of a new impairment will invariably lead to an increase of that nature by operation of the Combined Values Chart. The reasoning of the majority indicates that in substance this is what they meant[13]. [12](2005) 148 FCR 232 at 234, 252‑253.[13](2005) 148 FCR 232 at 252.