Catford v Laminex Group Pty Ltd

[2023] NTCA 7

CITATION:Catford v Laminex Group Pty Ltd [2023] NTCA 7

PARTIES:CATFORD, Joanne Claire

v

LAMINEX GROUP PTY LTD

TITLE OF COURT:  NORTHERN TERRITORY COURT OF APPEAL

JURISDICTION:  APPEAL from SUPREME COURT exercising Northern Territory jurisdiction

FILE NO:No. AP 1 of 2022 (22201333)

DELIVERED:  15 May 2023

HEARING DATE:  30 May 2022

JUDGMENT OF:  Southwood, Barr and Burns JJ

CATCHWORDS

WORKERS COMPENSATION – Appeal to Court of Appeal from decision of Supreme Court judge on appeal from Work Health Court – Whether appeal judge erred in law in finding that primary judge erred in law in determining worker’s ‘most profitable employment’ for purposes of s 65(2) (b)(ii) Return to Work Act 1986 – Whether appeal judge erred in law in finding that primary judge erred in law in dismissing the employer’s Counterclaim – Held primary judge did not err in law in the construction of s 65(2)(b)(ii) – Held primary judge did not err in law in finding that employer had not discharged onus to prove any amount which the worker was reasonably capable of earning in work she was capable of undertaking – Appeal allowed in part

WORKERS COMPENSATION – Entitlement to and liability for payment of   compensation – Weekly payments – Cessation of payments by employer – Whether Notice of Decision cancelling payment of weekly benefits valid – Appeal judge held that primary judge erred in law in finding notice of decision invalid – Held no error of law by appeal judge – Notice of decision valid.

Return to Work Act (NT) s 3(1), s 65(2), s 65(6), s 68, s 69, s 104, s 116
Work Health Administration Act 2011 (NT) s 14
Work Health Court Rules 1999 (NT) r 9.05

AAT Kings Tours Pty Ltd v Hughes (1994) 4 NTLR 185; Disability Services of Central Australia v Regan (1998) 8 NTLR 73; Ju Ju Nominees Pty Ltd v Carmichael (1999) 9 NTLR 1, followed

NT TAB Pty Ltd v Dickin (2004) 14 NTLR 99; Barbaro v Leighton Contractors Pty Ltd (1980) 44 FLR 204; Lee v Macmahon Contractors Pty Ltd [2018] NTCA 7, 41 NTLR 168, 335 FLR 350; Cardiff Corporation v Hall [1911] 1 KB 1009; Laminex Group Pty Ltd v Catford [2021] NTSC 92, referred to

REPRESENTATION:

Counsel:

Appellant:M Grove

Respondent:  D McConnel SC

Solicitors:

Appellant:Ward Keller

Respondent:  HWL Ebsworth Lawyers

Judgment category classification:    B

Number of pages:  67

IN THE COURT OF APPEAL
OF THE NORTHERN TERRITORY
OF AUSTRALIA
AT DARWIN

Catford v Laminex Group Pty Ltd [2022] NTCA 7

No. AP 1 of 2022 (22201333)

BETWEEN:

JOANNE CLAIRE CATFORD

Appellant

AND:

LAMINEX GROUP PTY LTD

Respondent

CORAM:SOUTHWOOD, BARR and BURNS JJ

REASONS FOR JUDGMENT

(Delivered 15 May 2023)

Southwood J

1. I agree, for the reasons given by Barr J, that the appeal should be allowed in part; that orders be made as proposed by his Honour at [53] below; and that the parties be heard as to the making of final orders.

   Barr J

2. This is an appeal from a decision of Grant CJ (“the appeal judge”) in the Supreme Court exercising jurisdiction pursuant to s 116(2) Return to Work Act 1986 in an appeal from the Work Health Court. The appeal from the Supreme Court to this Court lies pursuant to s 51 Supreme Court Act 1979.

3. For ease of understanding, I will refer to the within appellant as “the worker” and the respondent as “the employer”.

4. The background is as follows. The worker’s claim for an injury to her left shoulder was accepted in writing by the employer in April 2012. She then received payments of weekly compensation on the basis that she was totally incapacitated. By notice of decision dated 21 September 2018, the employer gave written notice of intention to cancel such weekly payments.[1] The payments then ceased. On 28 January 2021, the Work Health Court found that the employer’s notice of decision was invalid, and dismissed the employer’s counterclaim. Consequential orders were made for reinstatement of weekly payments, and for payment of arrears (with interest), medical expenses and costs.

5. The employer successfully appealed to the Supreme Court, which set aside the orders made by the Work Health Court and remitted the worker’s application and counterclaim to the Work Health Court, differently constituted, for hearing in accordance with law.[2]

6. The critical question before this Court, in considering the appeal from a decision of the Supreme Court, is whether the Supreme Court erred in law. It is not whether the Work Health Court erred in law.[3] However, if the Supreme Court erroneously found that the Work Health Court had erred in law, that is, that the Work Health Court had made a vitiating error of law when it had not, that would amount to an error of law made by the Supreme Court.

7. The notice of appeal contains 16 grounds, each asserting error or multiple errors on the part of the appeal judge. The notice does not mention the term “error of law” or allege that the appeal judge erred in law, but many if not most of the asserted errors, if made out, would be errors of law. At the request of the Court, made to avoid confusion arising from overly detailed and partly overlapping grounds and particulars, counsel for the appellant simplified the case on appeal by separating the grounds into three categories.

8. The first category of grounds asserts error on the part of the Supreme Court in finding, contrary to the decision of the Work Health Court, that the notice of intention to cancel weekly payments was valid. The appellant argued that the employer’s notice was invalid and asserted three errors on the part of the appeal judge: (1) a failure to find that the notice was vitiated by formal defect for non-compliance with s 69(1)(b) Return to Work Act 1986 (2) a failure to find that the notice was invalid because the medical practitioner did not provide a medical certificate which complied with s 69(3) Return to Work Act 1986 and (3) a failure to find that the notice as a whole did not comply with s 69(4) Return to Work Act 1986 in that it did not provide sufficient detail to enable the worker to understand fully why compensation was being cancelled or reduced.

9. I have considered the reasons for decision of the Work Health Court, the reasons for judgment of the Supreme Court and the submissions of counsel. The appellant has not established that the Supreme Court erred in law in finding that the notice complied with the procedural requirements of s 69 of the Return to Work Act 1986 and that it was otherwise valid. To the contrary, the appeal judge correctly identified errors of law in the decision of the Work Health Court, and did not err in that consideration. I adopt, with respect, his Honour’s reasoning.[4]

10. Before proceeding to consider the other two categories of grounds of appeal, I consider the position which should have prevailed if the Work Health Court had not fallen into error in finding that the notice of decision was invalid.

11. The employer’s decision, set out at the end of the notice, was as follows:[5]

    Based on the above, the employer has decided that:

    1.    You have ceased to be incapacitated (total or partial) as a result of the left shoulder injury.

    2.    You no longer suffer from a work-related injury to your left shoulder for the purposes of the Return to Work Act.

    3. In light of all of the above, your entitlement to compensation is cancelled pursuant to sections 65 and 69 of the Return to Work Act.

12. It can be seen from par 1 that the employer asserted a significant change of circumstances, namely that the worker was no longer totally or even partially incapacitated as a result of the accepted injury. On that basis, the employer cancelled payments of compensation; it did not reduce payments of compensation.

13. On the worker’s appeal to the Work Health Court, the employer had the onus of establishing a change of circumstances such as to warrant full cancellation of payments in the amount being paid immediately prior to the notice of decision in respect of the worker’s incapacity. That is consistent with decisions of this Court in AAT King’s Tours Pty Ltd v Hughes,[6] Disability Services of Central Australia v Regan,[7] and Ju Ju Nominees Pty Ltd v Carmichael.[8]

14. In AAT King’s Tours Pty Ltd v Hughes, the employer cancelled payments of compensation for the stated reason that the amount the worker was reasonably capable of earning was equal to or greater than the amount of his normal weekly earnings. The Court of Appeal observed that the employer’s case was not simply that the worker was no longer totally incapacitated; it was that he was no longer incapacitated at all.[9] The way in which the employer framed its case on cancellation meant that the employer necessarily assumed an evidentiary onus to establish that the worker no longer had a loss of earning capacity.[10]

15. In Disability Services of Central Australia v Regan, the worker had not simply appealed against the employer’s cancellation, but had widened the scope of the issues by her own pleadings that is, gone beyond a “mere appeal”. In that context, Mildren J observed as follows:[11]

    Had the worker merely appealed under s 69, the only question would have been whether the employer had established the grounds stated in the notice, the burden of proof in so doing resting with the employer. If the employer failed to establish these grounds, the effect of allowing the appeal would be that the employer would be required by force of s 69 to continue to make weekly payments of compensation until the employer was lawfully permitted to cease or reduce those payments, either by giving a fresh notice or by making a substantive application under section 104. … An appeal under s 69 calls into question only whether there has been a change in circumstances justifying the action unilaterally taken by the employer at the time the notice was given [citations omitted].

16. His Honour further observed:[12]

    In dealing with an appeal under s 69, … The question which has to be decided is whether, upon a consideration of all of the evidence in the case, the employer has proved the facts set out in the certificate, and if so, whether as a matter of law those facts support the conclusion that the worker’s weekly compensation payments should be cancelled or reduced, as the case may be, as from the relevant date, which is 14 days after service of the Form 5 notice.

17. In this context, I consider that it is important to clarify and correct the following statements made by the Court in Lee v MacMahon Contractors Pty Ltd:[13]

    43. Where an employer cancels the payment of weekly compensation pursuant to s 69 of the Return to work Act the worker may “appeal” against that cancellation. Although characterised as an appeal by the worker, in such an application the employer carries the onus of establishing the change of circumstances warranting the cancellation or reduction of the weekly compensation. If that change of circumstance is alleged in the notice to be that the worker has ceased to be incapacitated for work, the employer carries the burden of proving both that there has been compliance with the procedural requirements of s 69 and that there has been a cessation of total incapacity for work [Ju Ju Nominees Pty Ltd v Charmichael cited] ….

    44. If the employer is successful in discharging those onera, the onus of proving any partial incapacity passes to the worker. Alternatively, if the notice is found to be invalid, or if the employer fails to establish the cessation of total incapacity, it will be required to continue to make weekly payments of compensation until lawfully permitted to cease those payments by giving a fresh notice under s 69 or by making a substantive application under s 104 of the Return to Work Act and procuring an order in those terms.

18. It should first be noted that the remarks were obiter dicta. The Court had found that the notice given by the employer (MacMahon) was valid for the purpose of cancelling payment of weekly benefits in respect of incapacity attributable to the accepted injury, and had then considered whether it was necessary for the purposes of the appeal to consider the Work Health Court’s decision to dismiss the employer’s counterclaim.[14] The Court found that the counterclaim did not properly arise for consideration.[15]

19. It should next be noted that the statement in [44] of Lee v MacMahon Contractors does not state a principle of universal application. The consequences in relation to burden of proof, after service of an employer’s notice under s 69, will depend on (1) the basis on which the worker is being paid weekly compensation prior to the employer’s notice and (2) the grounds or assertions in the employer’s notice. If the worker is being paid compensation on the basis of total incapacity for work, and the employer’s notice asserts only that the worker is no longer totally incapacitated for work, the employer must prove that the worker is no longer totally incapacitated. If the employer succeeds in proving cessation of total incapacity, the onus of proving any partial incapacity would pass to the worker. I bear in mind that the definition of “incapacity” is “an inability or limited ability to undertake paid work because of an injury”.[16]

20. In the present appeal, the insertion of the words “or partial” in par 1 of the employer’s notice of decision is significant. Those words converted the employer’s assertion from one which would have required the employer to prove only that the worker was not entitled to the full amount of compensation being paid (in which case the worker would have to prove her entitlement to compensation on the basis of ongoing partial incapacity) to one in which the employer had to prove that the worker’s level of capacity was such that she was entitled to nothing by way of weekly payments of compensation.[17]

21. In the Supreme Court, the appeal judge expressed the view that, if the Work Health Court had correctly found that the notice of decision was valid, it would then have been incumbent on the Court to determine whether the employer had established a cessation of total incapacity and, if so, whether the worker had in turn proved a partial incapacity and to what extent.[18] For reasons explained in [12]–[14] and [19]–[20], I consider that his Honour was in error in relation to the worker’s obligation to prove the extent of her partial incapacity.

22. If the Work Health Court had correctly found that the employer’s notice of decision was valid, then the Court’s task was to decide whether the employer had proved that the worker’s level of capacity was such that she had no ongoing entitlement to weekly payments of compensation. Although the Work Health Court formally failed to do this, the Court did consider and decide the issues raised by the employer in its counterclaim, specifically the nature and extent of the worker’s ongoing incapacity, and made findings as to continuing incapacity. I will say more about the specific findings below. Suffice to say at this stage that those findings amounted to a clear rejection of the assertions in pars 1 and 2 of the employer’s notice of decision. As a result, the erroneous finding by the Work Health Court that the employer’s notice of decision was invalid did not, of itself, lead to further error.

23. Before I proceed to consider the issue of the worker’s incapacity, I will deal with the third category of grounds of appeal, relating to the validity of the employer’s counterclaim.[19] Counsel for the appellant contends that the Work Health Court did not have jurisdiction to entertain the employer’s counterclaim. The contention was rejected by the Work Health Court, and by the Supreme Court, but is still pressed on this appeal.

24. The utility of the counterclaim procedure under the Work Health Act (as the Return to Work Act 1986 was then named) was considered in a number of decisions of the Supreme Court and this Court. For example, in Disability Services v Regan,[20] Mildren J observed as follows:

    An employer who has served a s 69 notice may subsequently decide, after the [worker] has appealed, that the issues to be decided upon the appeal are too narrowly confined. At present, if the employer is in this position, the employer can bring its own substantive application and apply to have the two applications heard together. It may simplify hearings procedurally and focus proper attention on who bears the onus of proof if the rules were amended to permit the employer to raise new issues by way of counterclaim.

25. By 2004, the counterclaim procedure had become an established practice, and was by then the subject of express provision in the rules of court of the Work Health Court.[21] In NT TAB Pty Ltd v Dickin, Thomas J explained the purpose of the counterclaim in that case:[22]

    Paragraph 13 of the counterclaim is the same in substance as the ground set out in the “notice of decision” ... The counterclaim enabled the employer to argue the issue of the worker’s cessation of incapacity arising from her work injury on the merits and without being subject to failure on technical legal grounds relating to any alleged non-compliance with s 69 Work Health Act, such as whether medical certification under s 69(3) was contemporaneous; or whether the explanation of reasons for cancellation complied with s 69(4). If the notice of cancellation failed for technical reasons, then the employer’s case could still succeed on its counterclaim – Schell v Northern Territory Football League (1995) 5 NTLR 1 at 6.3; Disability Services v Regan (1998) 8 NTLR 73 at 78-79 per Mildren J; Alexander v Gorey & Cole Holdings Pty Ltd (2002) 171 FLR 31 at 30.

26. In Dickin, the employer’s s 69 notice was held to be ambiguous. The notice failed because of non-compliance with the requirements of s 69(4) Work Health Act 1986. However, the counterclaim procedure was not restricted to circumstances referred to by Thomas J in the above extract, and was available where an employer was concerned that the issues raised in its notice of decision were “too narrowly confined” (in the words of Mildren J in Regan). In the present case, where the employer set a very high bar for itself in the drafting of its notice of decision,[23] one may readily understand why the employer’s lawyers pleaded a counterclaim alleging the worker’s physical capacity and potential earnings as a basis for cancelling or reducing the amount of weekly compensation.

27. I extract below relevant parts of the counterclaim, being pars 9, 14, 14A, 15 and 16:

    9.Further, the Employer applies by Counterclaim in accordance with the Work Health Court Rules, for an order pursuant to section 104 of the Act cancelling or reducing the compensation.

    .....................

    14.Since 21 September 2018 the Worker has been capable of undertaking work as:

    14.1as a dental practice manager;

    14.2as a medical practice manager;

    14.3 as a dental receptionist; or

    14.4as a dental assistant/receptionist

    14A.Since 21 September 2018 the Worker has been reasonably capable of earning:

    14A1$1,538.46 gross per week as a dental practice manager;

    14A2$1,444.00 gross per week as a medical practice manager;

    14A3$961.54 gross per week as a dental receptionist; or

    14A4$769.23 gross per week as a dental assistant/receptionist.

    15.Further in the alternative, if (which is denied) the Worker is not capable of undertaking the work set out in paragraph 14 on a full-time basis, then;

    15.1She has been capable since 21 September 2018 of carrying out such employment on a part-time basis, namely at least 20 hours per week;

    15.2At a rate per hour of one thirty-eighth of the respective weekly rate.

    16.The Employer seeks:

    16.1An order for the cancellation or reduction of section 65 compensation from 5 October 2018 to such an extent as may be determined by the Court;

    16.2A declaration that the Worker has ceased to be totally incapacitated for work as a result of the injury ......

28. Counsel for the appellant contends that the enactment of the Work Health Administration Act 2011, specifically s 14 of the Act, brought about a change in the law, and that the jurisdiction of the Work Health Court to entertain a counterclaim had thereby been abolished. As mentioned, the contention was rejected by Judge Neill (“the primary judge”), who ruled that the Work Health Court had jurisdiction to hear and determine a claim by an employer in respect of a matter or question incidental to or arising out of a claim for compensation under Part 5 of the Return to Work Act 1986. His Honour further ruled that an employer could pursue such a claim by commencing fresh proceedings pursuant to s 104(1) of the Act or by filing a counterclaim in the proceedings commenced by a worker.[24] Having made those rulings, the primary judge made a finding that the issues raised by the employer in its counterclaim all involved matters or questions incidental to or arising out of the worker’s overall claim for compensation under Part 5 of the Act.[25]

1. That finding was upheld by the Supreme Court on appeal, in my view correctly. In his consideration of the asserted invalidity of the counterclaim procedure, the appeal judge referred to the observations made by Mildren J in Disability Services v Regan,[26] and continued as follows:[27]

   [35]    The Work Health Court Rules which had been made in 1987 were repealed and replaced by the Work Health Court Rules 1999 with effect from 1 August 1999, shortly after the decision in Disability Services v Regan was delivered. Whether coincidentally or not, r 9.05 of the new Rules made provision for counterclaims in the following terms:

   (1) If:

   (a) an employer served with a statement of claim has a claim against the worker; or

   (b) a respondent served with a statement of claim has a claim against the applicant,

   he or she may counterclaim in the proceeding by completing the part of the notice of defence that relates to a counterclaim.

   (2) A counterclaim is to contain:

   (a)a concise statement of the nature of the claim;

   (b) particulars of the claim; and

   (c) a statement of the relief or remedy sought.

   (3) The pleadings in a counterclaim are to comply with Part 8 but a failure to comply does not invalidate the counterclaim.

   (4) These Rules apply to and in relation to a counterclaim as if:

   (a) a reference in these Rules to a party who is the employer or respondent were a reference to the worker or applicant; and

   (b) a reference in these Rules to a party who is the worker or applicant were a reference to the employer or respondent.

   [36]    That provision remains in the Rules. Although the availability of the counterclaim process was not subsequently subject to any express analysis in the authorities, the Work Health Court’s jurisdiction to entertain a counterclaim by an employer was assumed on the basis that: (a) it was open to an employer to bring its own substantive application in response to an ‘appeal’ by a worker;[28] (b) such an application could broaden the issues to be determined beyond those raised by the ‘appeal’, including asserting a substantive case for cancellation or reduction; (c) the Court could entertain an application for such relief pursuant to s 104(1), read with s 94(1)(a) of the Work Health Act (as the Return to Work Act was then named);[29] and (d) subject to appropriate provision in the rules of court, the application could be brought by counterclaim rather than made separately, and heard together with the ‘appeal’.

   [37] At the time the Rules providing for counterclaims commenced, s 104(1) of the Work Health Act provided:

   For the purposes of the Court exercising its powers under section 94(1)(a), a person may, subject to this Act, commence proceedings before the Court for the recovery of compensation under Part V or for an order or ruling in respect of a matter or question incidental to or arising out of a claim for compensation under that Part.

   [38]     At the same time, s 94(1) of the Work Health Act provided:

   The Court has power to hear and determine -

   (a)claims for compensation under Part V and all matters and questions incidental to or arising out of such claims; and

   (b)all other matters required or permitted by this Act to be referred to the Court for determination,

   and such other powers as are conferred on it by or under this or any other Act.

   [39]    It was that latter provision, although couched in terms of ‘power’, which conferred jurisdiction on the Work Health Court. There can be no doubt that both an ‘appeal’ against cancellation and an employer’s substantive case in that respect were ‘matters [or] questions incidental to or arising out of’ a claim for compensation under Part V, which regulated both claim, cancellation and reduction procedures and the benefits available and payable under the legislation. However, it is the worker’s contention that subsequent iterations of the legislation have removed the provisions constituting and conferring power on the Work Health Court from the principal legislation (renamed the Return to Work Act), and promulgated them in different terms in the Work Health Administration Act 2011 (NT). Section 14 of the Work Health Administration Act relevantly provides:

   The Court has the following jurisdiction:

   (a) under the Return to Work Act 1986, to hear and determine:

   (i) claims for compensation under Part 5 of that Act; and

   (ii) all other matters required or permitted by that Act to be referred to the Court for determination;

   (b) ….

   (c) to determine all matters and questions incidental to, or arising out of, matters before the Court;

   (d) ….

   [40]    The worker’s argument follows that the Work Health Court’s jurisdiction is now restricted to hearing and determining claims for compensation and only such other matters expressly required or permitted under the terms of the Act to be determined by the Court. The examples of such matters postulated by counsel for the worker included determining the jurisdiction with which a worker’s employment is connected[30]; determining the proportions in which a deceased worker’s dependants are to receive benefits[31]; and interim determinations of compensation[32]. That submission cannot be accepted the following reasons.

   [41] The term ‘jurisdiction’ is an expression which is used in a variety of senses. As it is used in s 14 of the Work Health Administration Act, it denotes the authority of the Work Health Court to adjudicate upon a particular subject matter. The Work Health Court is a specialist tribunal, with two consequences. First, its jurisdiction is limited to matters arising under the Return to Work Act and the Work Health and Safety (National Uniform Legislation) Act 2011 (NT). Second, where a specialist tribunal is appointed by a statute to deal with matters arising under its provisions and to determine disputes concerning the granting of rights or privileges which are dependent entirely upon the statute, the tribunal’s jurisdiction is both exclusive and exhaustive in the determination and enforcement of those rights.[33]

   [42] Part 5 of the Return to Work Act continues to regulate both claim, cancellation and reduction procedures and the benefits available and payable under the legislation. Given the Work Health Court’s character and constitution as a specialist tribunal created to determine and enforce the rights and obligations arising under that Part, the jurisdiction ‘to hear and determine claims for compensation’ is properly construed to include all matters arising out of a ‘claim’ within the meaning of s 80 of the Return to Work Act. It is not limited to the hearing and determination of primary applications for compensation by a worker. The adoption of that construction is consistent with the principle expressed by the High Court in The Owners of the Ship ‘Shin Kobe Maru’ v Empire Shipping Company Inc that ‘[i]t is quite inappropriate to read provisions conferring jurisdiction or granting powers to a court by making implications or imposing limitations which are not found in the express words’.[34] That principle was expressed in response to a submission that the conferral of jurisdiction in ‘a claim relating to ownership’ was limited to a claim by which a plaintiff asserted a right to possession, title or ownership, and did not extend to ancillary claims for equitable relief by third parties.

   [43]    Moreover, on the construction pressed by the worker, although the Court would have jurisdiction to hear and determine an ‘appeal’ against cancellation, because it is a matter expressly permitted by the legislation to be determined by the Court, in the event of formal defect in the Notice of Decision the Court is not permitted to consider the substantive case underlying the employer’s use of the legislative machinery to either cancel or reduce payments of compensation. In hearing and determining that disputation, an employer cannot be deprived of the opportunity to present its substantive case in relation to that claim for compensation – whether by way of defence, counterclaim or separate application heard together with the ‘appeal’. To construe the grant of jurisdiction otherwise would be antithetical to the judicial process and the essential characteristics of a court.

   [44]    The contrived nature of the construction pressed by the worker is demonstrated by the fact that in circumstances such as those presently under consideration, an employer would only be precluded from ventilating its substantive case in the event that the Notice of Decision was found to be invalid. If found to be valid, for the reasons and on the basis of the authority described above, the employer’s substantive contentions concerning the cessation of total incapacity and the level of partial incapacity would fall to be heard and determined in the context of the worker’s ‘appeal’. If a worker’s ‘appeal’ falls within the Court’s jurisdiction, so too must the employer’s substantive contentions.

   [45] Even if I am wrong in that determination, s 14(a)(ii) of the Work Health Administration Act would invest the Court with jurisdiction to entertain a counterclaim by an employer asserting a substantive case as another matter ‘required or permitted by [the Return to Work Act] to be referred to the Court for determination’. As the Work Health Court identified in the reasons below, s 104 of the Return to Work Act permits a person to commence proceedings for an order or ruling in respect of a matter or question incidental to or arising out of a claim for compensation under Part 5. That formulation is broad enough to encompass either a separate application or a counterclaim by the employer, even if it were to be accepted that s 14(a)(i) of the Work Health Administration Act is not.

2. I adopt, with respect, the detailed analysis of the appeal judge. Further to [37] of his Honour’s reasons, I note that s 104(1) Return to Work Act 1986 remains unchanged in substance and still permits a person to commence proceedings in the Work Health Court not only for the recovery of compensation under Part 5 of the Act but also for “an order or ruling in respect of a matter or question incidental to or arising out of a claim for compensation under that Part”.[35] The question of an employer’s liability to pay or continue to pay compensation is properly characterised as “a question incidental to or arising out of a claim for compensation”. It would be extraordinary if the Work Health Court did not have jurisdiction to hear an application by an employer (whether by a separate application or by a counterclaim) in relation to that employer’s liability to pay compensation or in relation to the amount of compensation payable. As the appeal judge explained,[36] s 14(a)(ii) Work Health Administration Act 2011, read with s 104(1) Return to Work Act 1986, would permit an employer’s counterclaim (or a separate application by an employer) even if the worker’s contentions in relation to s 14(a)(i) had merit.

   Loss of earning capacity and ‘most profitable employment’

3. I turn to consider the second category of grounds of appeal, which relate to s 65 Return to Work Act 1986, specifically the worker’s entitlement to compensation for total or partial incapacity after the first 104 weeks of incapacity, and the calculation of such compensation.

4. To the extent that the worker was entitled to compensation, the amount of compensation was 75% of her “loss of earning capacity”.[37] I extract below s 65(2) of the Return to Work Act 1986 :

   (2)    For the purposes of this section, loss of earning capacity in relation to a worker is the difference between:

   (a)his or her normal weekly earnings indexed in accordance with subsection (3); and

   (b)the amount, if any, he or she is from time to time reasonably capable of earning in a week in work he or she is capable of undertaking if:

   (i)in respect of the period to the end of the first 104 weeks of total or partial incapacity – he or she were to engage in the most profitable employment (including self‑employment), if any, reasonably available to him or her; and

   (ii)in respect of the period after the first 104 weeks of total or partial incapacity – he or she were to engage in the most profitable employment that could be undertaken by that worker, whether or not such employment is available to him or her,

   and having regard to the matters referred to in section 68.

5. Section 68 Return to Work Act 1986 sets out mandatory considerations for assessment of the “most profitable employment available to a worker” for the purposes of section 65:

   68     Assessment of most profitable employment

   In assessing what is the most profitable employment available to a worker for the purposes of section 65 or reasonably possible for a worker for the purposes of section 75B(3), regard shall be had to:

   (a)his or her age;

   (b)his or her experience, training and other existing skills;

   (c)his or her potential for rehabilitation training;

   (d)his or her language skills;

   (e)in respect of the period referred to in section 65(2)(b)(i) – the potential availability of such employment;

   (f)the impairments suffered by the worker; and

   (g)any other relevant factor.

6. The words at the end of s 65(2), “and having regard to the matters referred to in section 68” suggest that regard must be heard to s68 in respect of both the first 104 weeks of incapacity and the period after the first 104 weeks of incapacity. However, as is clear from the introductory part of s 68, regard must be had to the s 68 matters “in assessing what is the most profitable employment available to a worker for the purposes of section 65 ...”. In my opinion, because s 65(2)(b)(ii) excludes consideration of whether or not employment is available to worker, s 68 would not apply in respect of the period after the first 104 weeks of incapacity. Nonetheless, even in relation to the period after the first 104 weeks of incapacity, a court must determine the amount which a worker is “reasonably capable of earning in a week in work he or she is capable of undertaking”. The expression “capable of undertaking” implies not only that the worker have the physical and mental capacity to undertake the work in question, but also that he or she have the experience, training and skills for such work. To that extent, s 68 adds little to s 65(2)(b).

7. The employer alleged in its counterclaim that, since 21 September 2018 (that is, from the date of the notice of decision), the worker had the capacity to undertake work in the four categories pleaded in par 14 of the counterclaim, and was thereby capable of earning the weekly amounts pleaded in par 14A of the counterclaim. In par 15 of the counterclaim, the employer alleged in the alternative that the worker was capable of part-time employment in the same categories, for at least 20 hours per week.

8. In the Work Health Court, the primary judge referred to the four categories of employment asserted by the employer as candidates for the worker’s most profitable employment within s 65(2)(b)(ii). His Honour then set out in brief summary the evidence relied on by the employer, taken from the report of occupational therapist Helen Coles, dated 12 July 2019. That evidence consisted of eight job advertisements which his Honour assumed had been advertised shortly before the date of the report. I extract below the primary judge’s observations in relation to the eight advertised jobs: [38]

   i)    Putney Dental Care – practice manager – this was an advertised position for a full-time job located in Putney, a suburb in north-west Sydney. The remuneration offered in the advertisement is a salary in the range of $60,000 to $80,000 a year.

   ii)   Maven Dental Group – practice manager – this was an advertised position for a full-time job located in Mullumbimby in north-east New South Wales. It required prior experience as a practice manager. No remuneration is mentioned in the advertisement.

   iii)     AB Dental – practice manager – this was an advertised position for a full-time job located in Bexley in southern Sydney. The remuneration in the advertisement is $38 an hour.

   iv)     Vincentia Bay Medical – office manager – this was an advertised position for a part-time job located in Shoalhaven on the shores of Jervis Bay south of Sydney. It required a Batchelor Degree. This advertisement offers a remuneration of $25 to $35 an hour.

   v)   Lakemba Medical Services – practice manager – this was an advertised position for a part-time job located in Lakemba in south-western Sydney. It required medical practice management experience. The advertisement offers a remuneration of $30 to $40 an hour.

   vi)     Kingsford Dental – receptionist – this was an advertised position for a full-time job located in Kingsford, in the eastern suburbs of Sydney. It “preferred” fluency in either Indonesian or Mandarin. The advertisement offers a salary of $40,000 to $50,000 a year.

   vii)   Blue Mountains Dental Care – dental assistant/receptionist – this was an advertised position for a part-time job located in Springwood New South Wales in the Blue Mountains to the east [sic] of Sydney. It required one year’s experience as a receptionist in a dental practice. The advertisement offers a salary of $30,000 to $40,000 a year.

   viii) Totally Smiles Dental Group – dental receptionist – this was an advertised position for a full-time job located in the suburb of Ryde in north-western Sydney. The advertisement offers a salary of $30,000 to $40,000 a year.

9. The primary judge observed that six of the jobs were located in the greater Sydney area, one on the coast south of Sydney and one in Mullumbimby in northern New South Wales, not far from the coast and the Queensland border. His Honour then referred to the fact that the worker had left the Northern Territory in or about September 2012 and that, for the previous 8 years, had lived with her husband in Gunnedah on the north-west slopes of New South Wales. The worker was originally from the Gunnedah area and had attended high school there. His Honour said that he was satisfied that it would not be practicable for the worker to continue her established life in Gunnedah and commute to any of the geographical locations to take up one of the eight identified jobs. However, his Honour ultimately ruled that s 65(2)(b)(ii) excludes from consideration the availability of such employment, including its geographical location, after the first 104 weeks of total or partial incapacity.[39]

10. There are some obvious examples of the situation where “the most profitable employment that could be undertaken by a worker” is “not available” to that worker. One such example is where there is a job or jobs which the worker has the capacity to carry out, but where all of the known positions are filled; that is, there are no vacancies in the labour market. Another example of employment ‘not available’, considered by the primary judge, was where the jobs (which the employer alleged the worker had the capacity to undertake) were at a prohibitive distance from the worker’s place of residence. There may well be other examples, but it is clear that the primary judge did not take into account the availability of employment to the worker, at least not in relation to geographical location.

11. In his consideration of the medical evidence of incapacity, the primary judge confined himself to incapacity arising from the injury to the worker’s left shoulder.[40] Relevantly, his Honour made the following factual findings, based on the evidence of orthopaedic surgeon, Dr Simon Hutabarat, who had been the worker’s treating orthopaedic surgeon from early 2015 to the date of the hearing:[41]

    I am satisfied and I find that as a consequence of the work injury the worker continues to experience symptoms arising in her left shoulder. I find that she experiences difficulties and pain when using her left arm in overhead activity and in reaching with her left arm both in front of her and out to her left side. I find she is limited in the weight she can manipulate with her left arm.

    I am satisfied and I find that as a consequence of the work injury the worker is presently limited in undertaking any suitably modified employment to working four hours a day for three days a week with a rest day between each day worked. I am satisfied and I find that the worker may in due course be able to build up to working 19 or 20 hours in a week in such employment. On the evidence before me which I have preferred, I am not able to determine how long it might take the worker to be able to advance from working 12 hours a week in such employment to 19 or 20 hours in a week, if at all.

1. The above findings and conclusions of the primary judge were crucial to his Honour’s ultimate decision. They are not open for reconsideration on the merits and necessarily stand unless infected by error of law. As the appeal judge explained, even a finding which is contrary to the overwhelming weight of evidence would not constitute an error of law, unless it were a finding with no evidential basis.[42]

2. Having made the findings set out in [38] above, the primary judge considered each of the jobs referred to [35], which his Honour described as “real, existing jobs”. Because of his specific findings that the worker could only work four hours a day, three days a week, with a rest day in between each day worked, his Honour excluded the five full-time jobs, and then made the following findings in relation to the other three:[43]

   146.    Of the remaining three jobs, iv) is an advertisement for a part-time office manager at Vincentia Bay Medical. It states that the applicant is required to hold a Bachelor’s Degree. The report of Ms Helen Coles of 2 November 2018 on page 9 sets out the Worker’s educational history and pre-incident employment. The report shows no history of any tertiary education. It does record a history of work as a dental assistant. There is no evidence before the Court that Vincentia Bay Medical might be prepared to overlook the requirement for a Bachelor’s Degree in the case of an applicant who is an experienced dental assistant. As the Employer bears the relevant onus, I cannot be satisfied that the Worker meets the requirements of the advertised job or that it involves work she is “capable of undertaking” or that she would be reasonably capable of earning anything in a week in that job.

   147.    Job v) is an advertisement for a part-time practice manager at Lakemba Medical Services. The advertisement states that any applicant must have experience as a medical practice manager. There is no record in the report of Ms Coles of 2 November 2018 that the Worker has ever worked as a medical practice manager. She appears to have substantial experience as a dental assistant but there is no record of her ever having worked in a medical practice or a doctor’s surgery. There is no evidence before the Court that Lakemba Medical Services might be prepared to overlook this requirement in the case of an applicant who is an experienced dental assistant. As the Employer bears the relevant onus, I cannot be satisfied that the Worker meets the requirements of the advertised job or that it involves work she is “capable of undertaking”, or that she would be reasonably capable of earning anything in a week in that job.

   148.    Job viii) is an advertisement for a part-time dental assistant/receptionist at the Blue Mountains Dental Centre. The advertisement requires that an applicant must have one year’s experience as a receptionist in a dental practice. Ms Coles’ report of 2 November 2018 records that the worker has worked in seven different jobs in New South Wales and in the Northern Territory as a dental assistant. It does not record that the Worker has ever worked as a receptionist. There is no evidence before the Court that the Blue Mountains Dental Centre might be prepared to overlook this requirement in the case of an applicant who is an experienced dental assistant but who has no experience as a receptionist in a dental practice. As the Employer bears the relevant onus, I cannot be satisfied that the Worker meets the requirements of the advertised job or that it involves work she is “capable of undertaking”, or that she would be reasonably capable of earning anything in a week in that job.

   149.    I conclude I must also rule out these three part-time jobs as candidates for the Worker’s “most profitable employment”.

   150.    In respect of each of the eight identified jobs in evidence before the Court as candidates for the Worker’s “most profitable employment”, there was no evidence before the Court, other than speculation, that any one of these eight identified jobs provided working conditions within the Worker’s capacity in light of the restrictions identified by Dr Hutabarat and found by me in paragraphs 123 and 124 above. The Employer has not discharged its onus to prove that the Worker is reasonably capable of earning anything in a week in any one of those jobs, or that she is capable of undertaking the duties, or all of the duties, in any one of those jobs.

3. The above findings also are findings of fact which necessarily stand unless infected by error of law, for the same reasons explained in [39]. That even applies to the finding at [148], about which I need say no more than that the employer failed to prove on the balance of probabilities that the worker had the capacity and experience, training and skills to carry out the duties of a receptionist in the relevant Dental Centre. As the primary judge stated in his reasons, the onus was on the employer to prove the allegations in its counterclaim and it did not call evidence from any employer to speak to the flexibility of stated requirements, or its ability to accommodate the worker’s limitations as found.

4. The primary judge in conclusion held that the employer had not discharged its onus of proving that the worker was capable of working on a full-time basis in the categories of employment pleaded in pars 14 and 14A of the counterclaim. The primary judge also held that the employer had not discharged its onus of proving that the worker was capable of working 20 hours a week in the same categories of employment, as pleaded in par 15 of its counterclaim. His Honour then observed:[44]

   In the absence of any evidence before the Court of any other real job which actually exists by way of any “most profitable employment” for the purposes of the Employer’s Counterclaim, the Employer has failed to discharge its onus to identify the Worker’s “most profitable employment” or to put a value on her partial incapacity to work.

   The Supreme Court appeal - ‘most profitable employment’

5. On the employer’s appeal to the Supreme Court, the appeal judge held that, having accepted Dr Hutabarat’s evidence that the worker was capable of working part-time hours as a medical receptionist or practice manager, the Work Health Court was “in error to impose the further requirement that the employer identify specific positions to enable an analysis of the selection criteria for those positions”.[45] His Honour continued:

   Those findings conflated the need to demonstrate an established type or category of employment which the worker was medically and functionally capable of undertaking, with the question of whether or not any specific positions within that type or category of employment were available to the worker. Those findings constituted an error on a question of law because they involved the misconstruction of s 65(2)(b)(ii) of the Return to Work Act.

6. In relation to the primary judge’s dismissal of the orders sought in the employer’s counterclaim for a reduction of compensation payable, on the basis that the employer had not identified a ‘real job’ which might constitute the worker’s ‘most profitable employment’, the appeal judge held that the dismissal was predicated on an error of law, and that it was incumbent on the Work Health Court to put a value on the worker’s loss of earning capacity, rather than simply dismissing the counterclaim.[46]

7. In the opinion of the appeal judge, the primary judge had erred in law in the construction of s 65(2)(b)(ii) by requiring that the employer identify a specific position available to the worker,[47] notwithstanding legislative amendment by the enactment of s 65(2)(b)(ii) to do away with consideration of availability of employment.

   No error of law by Work Health Court

8. In my judgment, the Supreme Court erred in law in finding that the Work Health Court erred in law when it had not.

9. It is important to bear in mind that the employer’s case, as pleaded in its counterclaim, was that the worker was or had been “capable of undertaking” work in the four categories of position alleged in par 14 of the counterclaim, earning the sums pleaded in par 14A of the counterclaim (and, in the alternative, part-time work in the same positions). As part of its case, the employer led evidence from an occupational therapist as to eight jobs within the four pleaded categories in which, the employer alleged, the worker was reasonably capable of earning the income pleaded. It is significant that the employer led that evidence to identify and prove the “work” which the worker was “capable of undertaking”, in which the employer alleged she was “reasonably capable of earning” the amounts of income it alleged. In this context, it is difficult to understand the conclusion of the appeal judge that it was the Work Health Court which “impose[d] the further requirement that the employer identify specific positions to enable an analysis of the selection criteria for those positions” (and that it erred in that respect).[48]

10. With respect, I disagree with the appeal judge that the primary judge erred in law in assessing evidence as to the worker’s capacity to carry out the duties of the positions identified by the employer. It was the task of the primary judge to determine, if he could, the amount (if any) which the worker was “reasonably capable of earning in a week in work ... she [was] capable of undertaking”.

11. Given the significant limitations found by the Work Health Court as to the worker’s ability to engage in full-time and even part-time employment (four hours a day, three days a week, with a rest day in between each day worked) and the employer’s failure to prove that the worker had the qualifications, skills and experience to work in the identified part-time jobs, the primary judge found the employer’s case wanting. That is hardly surprising. The worker had a work history as a dental assistant, and in fact had substantial experience in that occupation. However, the only job identified by the employer which even came close to matching the worker’s capability was a part-time dental assistant/receptionist position, but which required one year’s experience as a receptionist. The worker had no experience as a receptionist, and the employer did not contend (or lead evidence) that she did. There was no evidence that the employer had provided receptionist training to the worker. There was no evidence as to the part-time hours required, or as to the breakdown of hours between dental assistant and receptionist duties, but one could reasonably infer that the Blue Mountains Dental Centre considered that the receptionist duties were important because the advertisement had expressly required one year’s experience as a receptionist. In my opinion, the primary judge did not err in law in failing to be satisfied that the worker met the requirements of that advertised employment position.

12. It is noteworthy that the employer, even with the resources of its insurer, was not able to identify and prove a single part-time dental assistant position which accommodated the worker’s limitations.

13. In brief, the primary judge found that, given suitably modified employment, the worker had the capacity to work four hours a day, three days a week, with a rest day in between each day worked,[49] but that the employer had not proven that an actual job existed which accommodated such limitations.[50] The question was not whether such suitably modified employment was “available to the worker”, but whether such employment existed at all.

14. In my opinion, the Work Health Court did not err in law in finding that the employer had not discharged its onus to prove that the worker was reasonably capable of earning any amount in a week in “work she was capable of undertaking”, in the words of s 65(2)(b). The employer was clearly not entitled to any relief based on the worker being able to work full-time or “at least 20 hours per week” part-time, as the employer alleged. The Work Health Court did not err in law in dismissing the employer’s Counterclaim and making consequential orders, including an order for the resumption of weekly payments of compensation.

    Orders

15. I would affirm the order made by the Supreme Court setting aside the order made by the Work Health Court declaring the employer’s notice of decision invalid. I would otherwise set aside the orders made by the Supreme Court, and then hear the parties as to the orders which should be made consistent with these reasons.  

    Burns J

16. The present appeal concerns the appellant’s rights to receive workers compensation. In these proceedings the appellant, Joanne Claire Catford, seeks to set aside orders made by a judge of the Supreme Court on 31 May 2021 upholding an appeal by the present respondent, Laminex Group Pty Ltd, and remitting the proceedings to the Work Health Court for rehearing.[51]  

17. To avoid confusion I will refer to Ms Catford as “the worker” and to Laminex Group Pty Ltd as “the employer”.

    History

18. It is not in doubt that in February 2012 the worker sustained an injury to her left shoulder in the course of her employment with the employer. The worker completed and signed a Claim for Compensation form on 29 February 2012 which, initially, suggested that she was only seeking compensation for medical expenses. Whether that was then the case is not presently important, because the worker’s claim quickly became one which also encompassed a claim for weekly payments based upon total incapacity.

19. The worker’s claim was one to which the provisions of the Return to Work Act 1986 (NT) (the RTWA) applied (at that time titled the Workers Rehabilitation and Compensation Act). Consistent with the provisions of the RTWA, the employer, having been notified of the worker’s injury and her claim for compensation, was obliged to make a decision either to accept liability, to dispute liability or to defer accepting liability to pay the claimed compensation: s 85(1) RTWA.

20. The employer accepted liability and commenced paying the worker weekly compensation for total incapacity. This situation continued until 2018 when the worker was medically reviewed on behalf of the employer by Dr Steve Andrews, a hand and upper limb surgeon practising in Brisbane. Dr Andrews had previously medically reviewed the worker on behalf of the employer on multiple occasions from 2012 to 2016. On 28 August 2018 Dr Andrews reviewed the worker and in a report of the same date he expressed the following opinions:

    a)    The “relatively minor” incident at work in February 2012 likely caused an aggravation of an underlying condition suffered by the worker, being impingement and a partial tear of the worker’s rotator cuff and some acromioclavicular joint arthritis.

    b)   These conditions had been treated.

    c)    The work related aggravation of these conditions which occurred in February 2012 had now ceased.

    d)   Any ongoing symptoms experienced by the worker were the result of her underlying conditions and were not attributable to the aggravation of those conditions in February 2012.

    e)    The worker was capable of returning to work and working normal hours.

    f)    The worker may struggle with heavy and/or repetitive work above shoulder height, but any ongoing impairment was due to her underlying conditions and unrelated to the aggravation of those conditions in February 2012.

21. By a Notice of Decision and Rights of Appeal dated 21 September 2021 (the Notice) the employer notified the worker that it was cancelling payments of weekly benefits and referred the worker to the report of Dr Andrews dated 28 August 2018, a copy of which was provided to the worker with the Notice. The Notice stated that based upon the report of Dr Andrews the employed had made certain decisions, described in the Notice as follows:

    1.    You have ceased to be incapacitated (total or partial) as a result of the left shoulder injury.

    2. You no longer suffer from a work-related injury to your left shoulder for the purposes of the Return to Work Act.

    3. In light of the above, your entitlement to compensation is cancelled pursuant to sections 65 and 69 of the Return to Work Act.

22. The worker was dissatisfied with this decision. The worker commenced proceedings in the Work Health Court. Those proceedings were commenced by a Statement of Claim and the matter proceeded to trial on the basis of an Amended Statement of Claim dated 16 June 2020. In that Amended Statement of Claim the worker appealed from the decision to cancel her compensation on the grounds:

    a)    That the Notice was invalid because:

    i.It was not in the approved form;

    ii.The statement accompanying the Notice did not contain information which s. 69 of the RTWA required to be included; and

    iii.The statement did not contain sufficient information to enable the worker to understand why her compensation was being cancelled.

    b)   Alternatively, the reasons for the purported cancellation given in the Notice had not been substantiated.

23. The employer filed a Defence to the Statement of Claim which also pleaded a Counterclaim. For present purposes, it is sufficient to note that the Counterclaim asserted that since 21 September 2018 the worker had been capable of undertaking work as:

    a)    a dental practice manager earning $1538.46 gross per week;

    b)   a medical practice manager earning $1444.00 gross per week;

    c)    a dental receptionist earning $961.54 gross per week; or

    d)   a dental assistant/receptionist earning $769.23 gross per week.

24. In the alternative, the Counterclaim pleaded that if the worker was not capable of carrying out the duties of these occupations on a full-time basis, she was capable of carrying out such work on a part-time basis, namely “at least 20 hours per week”.

25. The worker filed a Reply to the employer’s Defence and a Defence to the employer’s Counterclaim. This Court only be troubled by the latter document, which pleaded that the Work Health Court did not have jurisdiction to hear and determine the employer’s Counterclaim.

26. Extensive evidence was called by both parties in the proceedings in the Work Health Court. On 28 January 2021 the Work Health Court made the following orders:[52]

    a)    The employer’s Notice was invalid;

    b)   The employer’s Counterclaim was dismissed;

    c)    The employer was to pay the worker arrears of weekly benefits plus interest;

    d) The employer was liable to pay to the worker continuing weekly benefits under the RTWA;

    e)    The employer was liable to pay the worker’s past and continuing medical expenses; and

    f)    The employer was to pay the worker’s costs.

27. The employer appealed from those orders to the Supreme Court, where the appeal was heard by a single judge (“the appeal judge”). In essence, the employer asserted that:

    a)The Work Health Court erred in finding that the Notice was invalid;

    b)The Work Health Court erred in determining the worker’s “most profitable employment” for the purpose of determining the worker’s loss of earning capacity under s 65 of the RTWA;

    c)The Work Health Court erred in dismissing the employer’s Counterclaim despite finding that the worker had the capacity to work 12 hours per week.

28. On 31 May 2021 the appeal judge allowed the employer’s appeal, set aside the orders made by the Work Health Court, and remitted the proceedings to the Work Health Court for rehearing. In essence, the appeal judge found that the Work Health Court erred in finding that the Notice was invalid, which finding had infected the court’s approach to the employer’s Counterclaim. In addition, the Work Health Court erred in determining the worker’s “most profitable employment”.

    The present appeal

29. The worker has appealed to this Court from the orders made by the appeal judge. A multitude of grounds of appeal were pleaded, but counsel for the worker was able to identify three categories of appeal grounds, being:

    Category 1: That the primary judge erred in finding that the Notice was valid.

    Category 2: That the primary judge erred regarding the correct approach to be taken to determining the worker’s “most profitable employment” for the purposes of s. 65 of the RTWA.

    Category 3: That the primary judge erred in finding that the Work Health Court had jurisdiction to hear and determine the employer’s Counterclaim.

1. I have had the benefit of reading in draft the judgment of Barr J in this appeal. I respectfully agree with his Honour that the worker has failed to demonstrate that the appeal judge erred with regard to Categories 1 and 3, and for the reasons given by his Honour. There is nothing further that I wish to add.

   Category 2- “most profitable employment”

2. I regret that I am unable to agree with Barr J’s finding that the appeal judge erred in finding that the Work Health Court erred regarding the Work Health Court’s approach to determining the workers “most profitable employment” for the purposes of s. 65 of the RTWA. In my opinion, the appeal judge made no such error. For the reasons that follow, however, I am nevertheless satisfied that the present appeal should be upheld. My reasons for upholding the appeal differ from those of the majority; they also go beyond matters addressed by the parties, particularly regarding the significance of s 65(6) of the RTWA. As my view is not determinative of the appeal, I did not consider it necessary to hear further submissions from the parties.

3. The starting point is the RTWA. I will direct my comments to the provisions of the RTWA concerning weekly payments of compensation, which is the central issue in this case. Where, as here, an employer accepts liability to pay compensation for incapacity arising out of a compensable injury, the first issue to be resolved is: how is the amount of compensation payable assessed? Before addressing that question, it is necessary to refer to some provisions of the RTWA and some basic principles.

4. The term “incapacity” for the purposes of the RTWA means “an inability or limited ability to undertake paid work because of an injury”: s 3 of the RTWA. An “injury” for these purposes is any physical or mental injury arising out of or in the course of the worker’s employment and includes a disease or any aggravation, acceleration, exacerbation, recurrence, or deterioration of a pre-existing injury or disease: s 3A of the RTWA (“a compensable injury”). The present case concerns a physical injury arising out of the worker’s employment.

5. It is apparent from the definition of “incapacity” in the RTWA that incapacity for the purposes of the RTWA may be total or partial. In other words, the compensable injury may completely deprive a worker of the ability to undertake paid work or it may reduce the ability of the worker to undertake paid work. When an injured worker receives compensation for incapacity, they receive payment not because they were injured but because their ability to earn has been lost or diminished.

6. It is in the interests of injured workers, employers and the community generally that employers be encouraged to accept liability to pay workers compensation in cases where the preconditions for entitlement to payment are satisfied. An injured worker is more likely to receive appropriate treatment to facilitate their return to work where issues of entitlement to compensation are expeditiously resolved. An early return to work assists in reducing the costs of administering the workers compensation scheme, which in turn helps to keep the scheme affordable. This approach is discernible in the provisions of the RTWA, which provides for early resolution of claims by agreement or after mediation before the commencement of proceedings in the Work Health Court.

7. I will now turn to the issue of how the amount of compensation payable is determined. Where a worker is totally or partially incapacitated for work as the result of a compensable injury, during the first 26 weeks of incapacity they are entitled to be paid compensation as assessed by reference to s 64 of the RTWA. In essence, the amount of compensation payable for a particular week is the difference between:

   a)The amount that the worker actually earned in employment during the week; and

   b)The worker’s normal weekly earnings immediately before the worker became entitled to compensation for the compensable injury.

8. After the first 26 weeks of incapacity, compensation for total or partial incapacity is assessed by reference to s 65 of the RTWA. This is referred to as compensation for “long-term incapacity”. The worker’s entitlement is capped at the lesser of 75% of their loss of earning capacity or 150% of average weekly earnings. The worker’s loss of earning capacity is determined by reference to s 65(2) of the RTWA, which provides:

   (2)   For the purposes of this section, loss of earning capacity in relation to a worker is the difference between:

   (a) his or her normal weekly earnings indexed in accordance with subsection (3); and

   (b) the amount, if any, he or she is from time to time reasonably capable of earning in a week in work he or she is capable of undertaking if:

   (i) in respect of the period to the end of the first 104 weeks of total or partial incapacity – he or she were to engage in the most profitable employment (including self-employment), if any, reasonably available to him or her; and

   (ii) in respect of the period after the first 104 weeks of total or partial incapacity – he or she were to engage in the most profitable employment that could be undertaken by that worker, whether or not such employment is available to him or her,

   and having regard to the matters referred to in section 68.

9. It will be seen that s 65(2) makes reference to the most profitable employment reasonably available to a worker (s 65(2)(b)(i)) or the most profitable employment available to a worker (s 65(2)(b)(ii)). This is a matter to which I will return later in these reasons.

10. The acceptance by an employer of liability to pay compensation for incapacity binds the employer to continue to pay compensation, and not to reduce the amount of compensation being paid, to an injured worker except in accordance with the RTWA: s 69(1) of the RTWA. This is so even though the employer voluntarily accepts liability. What, however, is the extent of the employer’s accepted liability? This is an issue of some significance, because it bears upon who holds the onus of proof in proceedings such as those commenced by the present worker in the Work Health Court.

11. In Barbaro v Leighton Contractors Pty Ltd,[53] the respondent employer voluntarily paid compensation for total incapacity to the injured worker from 1975 until 1977, at which time the employer unilaterally ceased payments. The relevant provisions of par 12 of the First Schedule to the Workmans Compensation Ordinance 1951 (ACT) provided that weekly payments “payable under this Ordinance” could be varied or ended by agreement or by arbitration under the Ordinance. The worker then brought proceedings seeking an arbitration with respect to the compensation payable to him and claiming total incapacity. The arbitrator found that the worker was not totally incapacitated and was not satisfied that the worker had established partial incapacity to earn by way of a compensable injury. The arbitrator therefore made an award for the employer, and that decision was upheld on appeal by the Supreme Court of the Australian Capital Territory.

12. On appeal, the Full Court of the Federal Court of Australia (at that time, the designated court of appeal from decisions of the Australian Capital Territory Supreme Court) found that, although there was no award or recorded agreement by which the worker was receiving payment, those payments were in respect of the employer’s liability under the Ordinance and hence, by reason of paragraph 12 of Schedule 1, they could not be unilaterally terminated.

13. The employee in Barbaro had commenced proceedings seeking an arbitration of his workers compensation rights, such that the court addressed both the entitlement of the employer to unilaterally terminate compensation payments and the workers application for arbitration. In this context Smithers J said, at 126:

    Notwithstanding the absence of a separate initiatory proceedings on the part of the respondent seeking to have the weekly payments which had been paid varied or ended in accordance with para 12 of the First Schedule, the terms of the applicant’s application were comprehensive enough to permit, and indeed require, and adjudication on the issue as to whether such weekly payments should be varied or ended. But although that is so, it was necessary that it should be recognised that the appellant should have full advantage of the situation arising from the payment of the weekly payments, namely that until it appeared that the weekly payments or to be varied or ended the respondent’s liability to continue to pay the same persisted. Unfortunately para 12 of the First Schedule appears to have been overlooked by all parties and not brought to the notice of the learned magistrate.

    It is apparent that as a matter of evidence the appellant’s case rested in the first instance on the fact that weekly payments had been made. Had the matter stopped there the case for an award on the basis of total incapacity would have been complete. Whether or not this would have been so in the absence of para 12 of the First Schedule it is clear that in the presence of para 12, and in the absence of evidence that the appellant was no longer totally incapacitated for work, the appellant would have been entitled to an award.

    (Emphasis added)

14. Later, at 126 – 127, his Honour continued:

    On appeal it is put by the appellant that because of the operation of para 12 he was entitled to an award unless the respondent satisfied the learned magistrate that the total incapacity by reference to which the weekly payments had been made had ceased. This is a sound view. But because of the error which had crept into the proceedings in that para 12 was overlooked the magistrate did not address himself to the question as to whether or not he was affirmatively satisfied that the incapacity by reference to which payments had been made had ceased.

    (Emphasis added)

15. Later still, at 131 – 132, his Honour said:

    It may be accepted, therefore, that the Ordinance contemplates that in a case where an award has been made for weekly payments on the basis of total incapacity, the respondent remains liable, except, at least in special circumstances, to make such payments notwithstanding the cessation of total incapacity until the award is terminated or varied by a competent court or perhaps by agreement. It may be argued from this that on an application to vary such an award the employer carried the onus of showing that circumstances had so changed, that not only had the workmen ceased to be totally incapacitated for work but was not partially incapacitated for work or was able to earn in work or business an amount which would reduce the weekly payments on the basis of partial incapacity to some specified amount less than the current weekly payments.

    In my opinion this does not follow. The form of the award provided for by Form 17 no doubt reflects the policy of workmen’s compensation legislation that once an award is made the payments therein provided for shall continue until terminated or vary by the court or by agreement. The workmen is not to be harassed by an employer unilaterally terminating or reducing his payments on the allegation that the workmen’s incapacity for work had decreased, thereby putting the workmen in the position of having to take action to prove, perhaps repeatedly, that his incapacity has not ended or decreased. It has a policy more than reasonable that the employer desiring relief from an award based on totally capacity should be required to obtain that relief from a court on proof that there has been a change of circumstances going to the basis of that award. That policy is reflected in para 12 of the First Schedule. Once weekly payments are made, on whatever basis, they are to continue until terminated or varied by agreement or by award: see Quinn v McCallum (1908) 2 BWCC 339; Cory Bros & Co Ltd v Hughes [1911] 2 KB 738; North’s Navigation Co Ltd v Batten (1933) 26 BWCC 525, and compare Western Australian Coastal Shipping Commission v Wallner (1979) 26 ALR 591, a decision of the Full Court of the Federal Court of Australia. But it does not appear to me that the factors above mentioned go to the question of the location of the onus of proof, when relief is sought from weekly payments theretofore voluntarily made or under an award.

    When relief is sought from an award based on totally capacity, no doubt the onus is on the employer to show a critical change in the circumstances upon which the award was based. Those circumstances comprise, in the words of s 7 of the Ordinance and para 1 (b) of the First Schedule, that the workmen had suffered injury arising out of, or in the course of, his employment with the employer and that in consequence thereof the workmen was totally incapacitated for work. When it is shown that one vital circumstance has changed, namely that total incapacity has ceased, then it is the turn of the workmen to raise a case depending upon a new circumstance… It is logical enough that the onus should then pass generally to the workmen, particularly in relation to his lack of capacity to earn money in business or employment. In that connection the facts are necessarily known to him and not necessarily or even a probably to the employer. The comments of Gibbs J in J & H Timbers PtyLtd v Nelson (1972) 126 CLR 625 at 651; [1972] ALR 331 at 344 – 5, concerning the relative unimportance of the actual location of the legal onus of proof are very much in point because it may well happen, and no doubt does happen in countless cases, that the evidence for instance, of cessation of total incapacity may well indicate a continuance of partial incapacity. But in a case like the present there was danger to both parties if the location of the onus of proof were not clearly perceived.

    (Emphasis added)

16. Smithers J, after referring to a number of English and Australian authorities, concluded that an award based on total incapacity is not, in substance, an award based upon total and partial incapacity. An award based upon total incapacity may be avoided by proof of the circumstance that total incapacity has ceased. Once it is established that total incapacity has ceased, the onus falls on the worker to establish that they are entitled to payment of compensation on the basis of partial incapacity and to establish the degree of their loss of ability to earn. The onus falls on the worker as the facts relevant to that claim are known to the worker and will probably not be known to the employer.

17. Franki J, in a separate judgment, effectively agreed with Smithers J on these issues.

18. The facts in Barbaro differ from the facts in the present proceedings in that in Barbaro there was not a provision the equivalent of s 69 of the RTWA and consequently no notice was provided in Barbaro akin that that provided to the present worker. This begs the question: what is the effect of an employer giving a worker a s 69 notice? And in particular, does the form of the notice dictate the effect of the notice regarding the onus of proof of partial incapacity once it is established that the worker is no longer totally incapacitated?

19. These issues were addressed by this Court in AAT Kings Tours Pty Ltd v Hughes (1994) 4 NTLR 185 (AAT Kings). In that case the worker, a bus driver, sustained an injury to his left eye in the course of his employment which resulted in a 95 percent impairment of vision in that eye. The employer paid compensation to the worker for approximately 9 months, after which the employer gave the worker notice under s 69 of the Work Health Act 1986 (subsequently retitled the RTWA) cancelling payments of compensation. The reason given for the cancellation by the employer were:

    That the amount you are reasonably capable of earning is equal to or greater than the amount of your normal weekly earnings as defined under the Work Health Act.

20. A worker dissatisfied by the decision of an employer to cancel weekly incapacity benefits may either appeal the decision to cancel the benefits or they may proceed by way of an application under s 104 which relevantly provides:

    Applications

    (1) A person may, subject to this Act, commence proceedings before the Court for the recovery of compensation under Part 5 or for an order or ruling in respect of a matter or question incidental to or arising out of a claim for compensation under that Part.

    (2)     Proceedings under this Division may be commenced before the Court by application in the prescribed manner and form or, where there is no manner or form prescribed, in such manner or form as the Court approves.

21. The worker commenced proceedings in the Work Health Court. The report of the decision in AAT Kings is silent regarding the procedural basis for the proceedings before the Work Health Court, but it is probable that the proceedings were an appeal by the worker pursuant to the combined effect of sections 69 and 111 of the Work Health Act. Certainly, the reported decision make no reference to any application by the worker pursuant to s 104 of the Work Health Act and the terms of such an application.

22. The Court drew from the form of the s 69 notice that the “employer’s case was not simply that the worker was no longer totally incapacitated; it was that he was no longer incapacitated at all.” The Court held at 191, by reference to the decision in Barbaro that:

    When relief is sought from an award based on total incapacity, the onus is on the employer to show a change in the circumstances upon which the award is based. Those circumstances comprise loss of total incapacity. When it is shown that total incapacity has ceased, which normally also demonstrates a change in loss of earning capacity, the employer will discharge the onus. It has been said that it is “logical” that the onus of proving any partial incapacity should then pass generally to the worker as the facts are necessarily known to him and not necessarily, or even probably to the employer…

23. The Court went on to say, at 191,:

    In this case, however, the employer assumed the burden of proving that the worker was not incapacitated at all (see p 2).

24. The Court in AAT Kings treated the form of the s 69 notice as akin to pleadings in the proceedings that were commenced by the employee in the Work Health Court. No authorities were cited by the Court supporting this approach. There appears to be no reason in logic or principle for the Court to have adopted this approach. By adopting this approach, the Court in AAT Kings found that the form of the s 69 notice required a deviation from the clearly articulated, principled approach taken by the Full Federal Court in Barbaro. This Court should take the opportunity to confirm that, in the case of a simple appeal from a decision to cancel total incapacity payments communicated by a notice under s 69 of the RTWA, the onus which falls on the employer is to demonstrate a change in circumstances such that the employer is no longer obliged by the provisions of the RTWA to make payments for total incapacity. Even in cases, as in the present, where the position is complicated by the employer filing a Defence and Counterclaim to the Statement of Claim filed by the worker commencing the appeal, care should be taken to distinguish between the issues raised by the appeal from the decision conveyed by the s 69 notice and those raised by pleadings in any Defence or Counterclaim.

25. As I earlier observed, a decision by an employer to voluntarily accept liability to make weekly payments for total incapacity binds the employer to continuing to pay compensation, and not to reduce the amount of compensation being paid, to an injured worker except in accordance with the RTWA: s 69(1) of the RTWA. Where liability has been accepted for total incapacity, the issue of partial incapacity has never been addressed by the parties. The employer has not agreed to pay the employee compensation for partial incapacity, and the extent of the employee’s partial incapacity has, quite obviously, never arisen for consideration. The only issue between the worker and the employee which a s 69 notice can address is the workers entitlement to ongoing payments for incapacity on the basis originally accepted by the employer. In the present case, that is on the basis of total incapacity.

1. If the approach taken in AAT Kings is correct, an employer could avoid the onus which in that case was cast on the employer by the simple expedient of stating that the reason for cancellation of payments is that the worker is no longer totally incapacitated. The decision in Barbaro would then dictate who holds the onus of proof with regard to the issues arising from the s 69 notice. This drafting requirement simply elevates form over substance.

2. The correct approach to determining the effect of a s 69 notice is to accept that the notice operates, and can only operate, according to the issue that was originally agreed between the parties. In a case of an employer who has accepted liability for total incapacity, the notice can only operate to cancel liability for total incapacity and to provide a reason for that action. It is apparent from the terms of s 69 that the provision is concerned with cancellation or reduction of an amount of compensation. It is not possible for the section to apply to compensation which may be payable to a worker on some other basis than that on which it is currently being paid.

3. This approach is not inconsistent with the decision of this Court in Disability Services of Central Australia v Regan,[54] which cited with approval the decision in AAT Kings, but only with regard to the proposition that “an appeal under s 69 calls into question only whether there has been a change in circumstances justifying the action unilaterally taken by the employer at the time the notice was given”.[55] In that case the worker’s claim for compensation was accepted by the employer, but at a later time the employer purported to cancel compensation payments of weekly benefits. The worker purported to appeal the employer’s decision but in the pleading of the application before the Work Health Court the worker went beyond simply appealing the employer’s decision and as such was found to have widened the issues before the Work Health Court.

4. The decision in Disability Services v Regan can be distinguished from that in AAT Kings on their facts. Disability Services v Regan was concerned with the effect of pleadings in the Work Health Court and not with the effect of the form of a s 69 notice on proceedings subsequently commenced by a worker as a mere appeal from the decision in such a notice.

5. Of course, an employer may take the view that the evidence establishes a cessation of total incapacity but supports a finding of partial incapacity. In such a case the employer may agree to pay compensation based on partial incapacity, in exactly the same way that the employer originally agreed to pay compensation for total incapacity. The employee may, of course, accept that decision or may commence proceedings in the Work Health Court, either by way of appeal from the notice or by way of an application under s 104 of the RTWA. The statement made by the employer in the present Notice to the effect that payment of total incapacity compensation benefits was to be cancelled on the basis that the worker was no longer either totally or partially incapacitated was operative to the extent that it asserted that total incapacity had ceased and informative to the extent that it advised the worker that the employer was not willing to accept liability for partial incapacity arising out of the compensable injury.

6. Such an approach preserves the operation of the principles expressed in Barbaro without the need to articulate exceptions to those principles based upon the terminology of a s 69 notice. It is also consistent with recent decisions such as Lee v MacMahon Contractors Pty Ltd,[56] where this Court said:

   Following the commencement of the legislation (originally styled as the Work Health Act), a considerable body or authority developed concerning the operation of the cancellation process. So far as is relevant for these purposes, the principles expressed in that body of authority may be summarised as follows:

   (a) A notice cancelling or reducing compensation for loss of earning capacity (weekly benefits) for the reason that the worker has ceased to be incapacitated for work must sufficiently state the reasons for that cancellation or reduction and be accompanied by a medical certificate in accordance with s 69(3). There must be substantial, if not strict, compliance with those requirements.

   (b)   A worker may bring an “appeal” to the Local Court (formerly Work Health Court) against a decision to cancel or reduce weekly benefits.

   (c)   A Notice which fails to state sufficiently the reasons for the cancellation or reduction and/or which is not accompanied by a compliant medical certificate will be invalid and ineffective in terminating the worker’s right to receive weekly payments of compensation.

   (d)   It is open to an employer to guard against the contingency that a notice may be found to be invalid for formal reasons by bringing a “counterclaim” to the workers “appeal” asserting the substantive case for the cancellation or reduction.

   (e)   If the notice is a valid, or if it is invalid but a counterclaim asserting the same ground is made, the employer bears the onus of establishing the change of circumstances warranting the cancellation or reduction of the weekly benefits. If the notice is valid and the reason for cancellation is an assertion that the worker has ceased to be incapacitated for work, the employer assumes the burden of proving the cessation of total incapacity. If the employer fails to establish the change in circumstances, it will be required to continue the payment of weekly benefits until those payments are lawfully cancelled or reduced.

   (Footnotes omitted)

7. Later, at [43] to [45], the Court continued:

   Where an employer cancels the payment of weekly compensation pursuant to s 69 of the Return to Work Act the worker may “appeal” against that cancellation. Although characterised as an appeal by the worker, in such an application the employer carried the onus of establishing the change of circumstances warranting the cancellation or reduction of the weekly compensation. If that change of circumstance is alleged in the notice to be that the worker has ceased to be incapacitated for work, the employer carries the burden of proving both that there has been compliance with the procedural requirements of s 69 and that there has been a cessation of total incapacity for work…

   If the employer is successful in discharging those onera, the onus of proving any partial incapacity passes to the worker. Alternatively, if the notice is found to be invalid, or if the employer fails to establish the cessation of total incapacity, it will be required to continue to make weekly payments of compensation until lawfully permitted to cease those payments by giving a fresh notice under s 69 or by making a substantive application under s 104 of the Return to Work Act and procuring an order in those terms.

   However, under the body of authority which has built up around the operation of s 69 of the Return to Work Act (referred to earlier), if the worker has in the pleading widened the scope of the issues beyond an appeal against cancellation under s 69, the employer is not limited to establishing a cessation of incapacity and may raise other grounds by way of an answer to the “appeal”. These matters might include, by way of example, the question of whether the injury arose out of or in the course of employment in the first place. That potential to broaden the scope of the issues for determination, and the requirement for strict compliance with the procedural requirements of s 69 of the Return to Work Act, led to a practice by which workers sought to confined appeals to a challenge to the notice.

   (Footnotes omitted)

8. Accepting, with respect, that this is a correct exposition of the law, and accepting that the Notice operated in the way I have described, the obligation which was cast on the present employer by the giving of the Notice was an obligation to establish that the worker was no longer totally incapacitated by reason of her compensable injury. In considering what was required of the employer in that regard it is important to bear in mind that the obligation cast on the employer is not simply to establish that the worker has recovered, or substantially recovered, from the compensable injury. The onus on the employer is to prove that the worker no longer has an inability to undertake paid work because of the injury. In many cases, of course, proof that a worker has recovered from a compensable injury will also establish an ability to undertake paid work.

9. Very few cases of compensable injury result in the worker being physically incapable of undertaking work; human ingenuity being what it is, it is possible to hypothesise a form of employment which would accommodate virtually any form of physical or mental disability. In reality, of course, no such form of employment may actually exist. For this reason, the focus of workers compensation enactments is upon the effect that a compensable injury has upon the workers ability to earn in the real world market. The existence of a physical capacity to work does not always translate to an ability to earn. As the primary judge observed, this was recognised over a century ago in Cardiff Corporation v Hall [1911] 1 KB 1009 (Cardiff Corporation), where Fletcher Moulton J said, at 1020-1021:

   There can therefore be no general principle, i.e., a principle true in all cases, that in the case of partial incapacity the employer is required not only to show what work the workman can do but also to show that he can get such work. But on the other hand I am also of the opinion that there are cases in which the onus of showing that suitable work can in fact be obtained does fall upon the employer who claims that the incapacity of the workmen is only partial. If the accident has left the workmen so injured that he is incapable of becoming an ordinary workman of average capacity in any well-known branch of the labour market – if in other words the capacities for work left to him for him only for special uses and do not, so to speak, make his powers of labour merchantable article in some of the well-known lines of the labour market, I think it is incumbent on the employer to show that such special employment can in fact be obtained by him. If I might be allowed to use such an undignified phrase I should say that if the accident leaves the workmen’s labour in the position of an “odd lot” in the labour market, the employer must show that a customer can be found who will take it.

10. Do these principles find expression in s 65 of the RTWA? In my opinion, they do. The assessment of compensation for long-term incapacity, both for the initial 104 weeks and thereafter, requires a determination of the worker’s loss of earning capacity: s 65(1B) RTWA. The loss of a worker’s earning capacity is determined in accordance with s 65(2) of the RTWA: see [78] above. For the period to the end of the first 104 weeks of long-term incapacity the worker is entitled to compensation assessed as the difference between their indexed normal weekly earnings and the amount that the worker is reasonably capable of earning in a week in work he or she is capable of undertaking if he or she were to engage in the most profitable employment, if any, reasonably available to him or her and having regard to the matters referred to in s 68 of the RTWA.

11. For the period after that first 104 weeks of total or partial incapacity the worker is entitled to compensation assessed as the difference between their indexed normal weekly earnings and the amount that the worker is reasonably capable of earning in a week in work he or she is capable of undertaking if he or she were to engage in the most profitable employment that could be undertaken by the worker, whether or not such employment is available to the worker, and having regard to the matters referred to in s 68.

12. The provisions of s 68 are set out below:

    Assessment of most profitable employment

    In assessing what is the most profitable employment available to a worker for the purposes of section 65 or reasonably possible for a worker for the purposes of section 75B(3), regard shall be had to:

    (a)   his or her age;

    (b)   his or her experience, training and other existing skills;

    (c)   his or her potential for rehabilitation training;

    (d)   his or her language skills;

    (e) in respect of the period referred to in section 65(2)(b)(i) – the potential availability of such employment;

    (f)   the impairments suffered by the worker; and

    (g)   any other relevant factor.

13. It will be observed that a significant difference between the prescribed manner of assessment of compensation for that period of the first 104 weeks and the period after the first 104 weeks found in s 65(2) is that in the case of the former period a relevant consideration is the reasonable availability to the worker of the most profitable employment that the worker is capable of undertaking, whereas that consideration is not relevant to the assessment of compensation for the period after that first 104 weeks. The provisions of s 68 mirror that distinction. Availability of employment is not relevant to the assessment required by s 65(2)(b)(ii).

14. The intention of the legislature in enacting the provisions of the RTWA concerning compensation for long-term incapacity is to distribute losses occasioned by employment injuries in what it determines to be a fair manner across employers, workers and the community, and to encourage rehabilitation of injured workers. As part of achieving that aim, the legislature specifically recognised, in s 65(6), that in some cases an injured worker may not be able to translate a capacity to work into a capacity to earn. That provision states:

    (6) For the purposes of this section, a worker shall be taken to be totally incapacitated if he or she is not capable of earning any amount if he or she were to engage in the most profitable employment, if any, reasonably available to him or her, and having regard to the matters referred to in section 68.

15. Section 65(6) uses the language of reasonable availability of employment, which may suggest that it should be read as applying only to the period of incapacity referred to in s 65(2)(b)(i), as availability of employment is expressly excluded from consideration during the period covered by s 65(2)(b)(ii). In my opinion it would be a mistake to attempt to interpret s 65(6) by reference to s 65(2). In my opinion, the RTWA requires a stepped approach.

16. Step 1 requires a determination of loss of earning capacity as provide by s 65(2). In the case of long-term incapacity after the first 104 weeks, this loss is assessed without reference to availability of employment. Assuming that this results in a determination that the worker is reasonably capable of earning something in work that he or she is capable of undertaking, Step 2 then requires an independent determination of whether the worker should nevertheless be deemed to be totally incapacitated by reference to s 65(6). In that final determination, reasonable availability of employment is a relevant consideration.

17. For these reasons I am satisfied that the “odd lot” principle applies in determining compensation payable to an injured worker during all periods covered by s 65 of the RTWA.

18. It follows from the above that the onus which fell on the present employer, being the onus of proving that the worker was no longer totally incapacitated, included the obligation of establishing that any remaining limitations on the worker to undertake paid work by reason of the compensable injury did not place her in an “odd lot”.

19. The case for the employer, of course, was that the worker had fully recovered from the effects of the compensable injury and that any remaining symptoms and consequent limitation on her ability to undertake paid work was unconnected to the compensable injury. This was a question of fact to be determined by the Work Health Court. The Work Health Court heard extensive medical evidence regarding the effect of the worker’s compensable right shoulder injury on her continuing symptoms and capacity to undertake paid work. The Work Health Court made the following findings, which have not been the subject of challenge:

    123 I am satisfied and I find that as a consequence of the work injury the Worker continues to experience symptoms arising in her left shoulder. I find that she experiences difficulties and pain when using her left arm in overhead activity and in reaching with her left arm both in front of her and out to her left side. I find she is limited in the weight she can manipulate with her left arm.

    124 I am satisfied and I find that as a consequence of the work injury the Worker is presently limited in undertaking any suitably modified employment to working four hours a day for three days a week with a rest day between each day worked. I am satisfied and I find that the Worker may in due course be able to build up to working 19 or 20 hours in a week in such employment. On the evidence before me which I have preferred, I am not able to determine how long it might take the Worker to be able to advance from working 12 hours in a week in such employment to 19 or 20 hours in a week, if at all.

20. Although it is not specifically stated in the reasons of the Work Health Court, I understand that the reference to “such employment” in the above extract is a reference to the forms of employment which the employer asserted the worker was capable of undertaking. Such a finding is clearly a finding that the worker was partially incapacitated for work. Focusing solely on the onus cast on the employer by the giving of the s 69 Notice, the employer had an obligation to establish that the worker was capable of earning some amount in employment that was reasonably available to her. If the employer failed to establish that fact, then the worker fell into an “odd lot” and was to be taken to be totally incapacitated: see s 65(6) of the RTWA.

21. In the Work Health Court, the employer led evidence of the existence of the four categories of employment that it asserted the worker was fit to engage in. As the Work Health Court acknowledged, at [87], this was in support of a submission by the employer that in order to establish that there was profitable employment reasonably available to the worker for the purposes of s 65, the employer merely needed to identify a class of jobs that the medical experts say that the worker can do. The Work Health Court rejected that submission on the basis that it was not supported by “the scheme of the Act and the case law”. The Work Health Court went on to say:

    88.   In Quality Plumbing & Building Contractors Pty Ltd v Schloss (“Schloss”) [2015] NTSC 56 at paragraph [43] Justice Kelly quoted from the second reading speech relevant to the introduction of subsection 65(2)(b)(ii), the first line of which states: “The bill will provide for a stronger ability to deem (my emphasis) injured workers to have the potential to reduce future long term scheme costs by enabling the possible reduction or cancellation of benefits in accordance with the claimant’s reasonable capacity to earn (Justice Kelly’s emphasis)”. In paragraph [46], Justice Kelly went on to endorse a number of propositions, including the following:

    [46]…both parties agreed on the following – in my view, rightly so (my emphasis).

    (a)For the ‘deeming’ (my emphasis) provisions of s 65 to apply, the Employer must be able to identify a ‘real job’ (my emphasis) that could be undertaken by the Worker – that is to say one that actually exists (my emphasis), whether or not there are vacancies for employment in that job at the time...”.

    89.    This endorsement is obiter dictum and as such it is not binding on the Work Health Court. I note however that it accords with the earlier approach taken by Justice Blokland in\ Global Insulation Contractors (NSW) Pty Ltd v Keating (“Keating”) [2012] NTSC 4 at paragraphs [110] and [111] where her Honour said concerning the approach taken by the Work Health Court below:

    [110]Her Honour considered the issue of the work that the respondent worker could or could not do in some detail. On behalf of the employer it was submitted her Honour misapplied s 65(2)(b)(ii) of the Act. The submission is that assumed availability of suitable employment post 104 weeks under the section excludes consideration of market forces and any need to consider what many places of employment require, as distinct from the fundamental requirements of the job.

    [111]Although her Honour described some of the duties of crane operator or forklift driver as ancillary, in the sense that they involved preparation of load and other duties in the context of arduous environments, this is not in my view beyond the scope of s 65(2)(b)(ii). While the section is concerned with the fundamental requirements of a job, this must be sensibly construed and applied. In my view, her Honour was entitled to consider the physical requirements of any position. That approach is in keeping with the purposes of the Act and the section (my emphasis)”.

    90.    Plainly, a Court can consider “...the physical requirements of any position...” only if there is evidence before it of those requirements, which would necessitate evidence of an actual job which has those requirements.

    91.    I respectfully agree with the obiter dictum of her Honour Justice Kelly in Schloss above and I proceed to determine the present matter on the basis that this persuasive authority is the correct approach to determining “most profitable employment” after the first 104 weeks of incapacity – that is, an employer who bears the relevant onus must identify a real job which actually exists as a candidate for any “most profitable employment”.

1. From the Work Health Court’s rejection of the submission made on behalf of the employer and the above extract from the decision of the Work Health Court, I agree with the appeal judge that the Work Health Court has found that the obligation imposed on the employer by s 65(2)(b(ii) to identify work that the worker is capable undertaking is an obligation to identify a position or vacancy which has been advertised, the duties of which the worker would be capable of undertaking. I agree with the appeal judge that this was an error on the part of the Work Health Court. It is clear that at that point of the judgment, and in that section where the Work Health Court examined the requirements of the individual advertised vacancies, the Work Health Court was addressing the requirements of s 65(2) of the RTWA. I agree with the appeal judge’s statement, at [68]:

   As stated, the Work Health Court had already accepted Dr Hutabarat’s evidence that the worker was capable of working part-time hours as a medical receptionist or practice manager. It was in error and to impose the further requirement that the employer identify specific positions to enable an analysis of the selection criteria for those positions. Those findings conflated the need to demonstrate an established type or category of employment which the worker was medically and functionally capable of undertaking, with the question of whether or not any specific positions within that type or category of employment were available to the worker.

2. Were the matter to rest there, I would agree with the appeal judge that the matter should be remitted to the Work Health Court for rehearing. But the matter does not rest there. The question that should have been addressed by the Work Health Court was whether the employer had discharged its onus flowing from the service of the Notice of proving that the worker was not totally incapacitated, including deemed incapacity by reason of an inability to earn any amount in the most profitable employment reasonably available to her and having regard to the matters referred to in s 68. This required an analysis of the evidence led by the employer of the forms of employment that the worker could undertake, and whether there was evidence that someone with the impairments of the worker, and her consequent limited capacity to engage in employment as identified by the Work Health Court, was capable of earning any amount in employment that was reasonably available to her.

3. This is effectively what the Work Health Court did in the extract at [112] above and in the later part of the judgment where the requirements of the individual advertised positions were compared with the worker’s residual capacity. The Work Health Court examined the evidence and determined that there was no evidence that the worker’s residual capacity for work would enable her to earn any amount in any employment reasonably available to her.

4. The filing of the Counterclaim by the employer does not affect any of the above. The onus always rested on the employer to establish that the worker was not entitled to compensation based on total incapacity.

   Summary

5. In summary, I would uphold the appeal for the following reasons:

   a)By giving the worker the Notice under s 69 of the RTWA, the employer assumed the onus of proving that circumstances had changed such that the worker was no longer entitled to be paid compensation for total incapacity;

   b)In order to satisfy that onus the employer was required to prove that the worker was capable of earning some amount if she were to engage in the most profitable employment available to her; that is, that the worker was not part of an “odd lot” whose residual capacity for employment could not translate into an ability to earn in the labour marketplace;

   c)The limited evidence before the Work Health Court did not establish that the worker’s residual capacity for work, as determined by that Court, enabled her to earn anything in any employment reasonably available to her; and

   d)Consequently, the worker was deemed to be totally incapacitated by virtue of s 65(6).

   Orders

6. I agree with the orders proposed by Barr J.

   ______________________

[1] The notice of decision [AB 497] read: “(the employer) ... Cancels payments of weekly benefits to you pursuant to Section 69 of the Return to Work Act. The cancellation will be effective in 14 days from your receipt of this notice”.

[2]      Laminex Group Pty Ltd v Catford [2021] NTSC 92 at [76].

[3]      Wilson v Lowery (1993) 4 NTLR 79 at 83-84; Development Consent Authority v Phelps (2010) 27 NTLR 174; Lee v MacMahon Contractors Pty Ltd [2018] NTCA 7, 335 FLR 350 at [19].

[4]      See Laminex Group v Catford [2021] NTSC 92 at [4] – [24].

[5]      AB 494.

[6]      AAT Kings Tours v Hughes (1994) 4 NTLR 185.

[7]      Disability Services of Central Australia v Regan (1998) 8 NTLR 73.

[8]      Ju Ju Nominees Pty Ltd v Carmichael (1999) 9 NTLR 1 at [15], sub-par 3.

[9]      AAT Kings Tours v Hughes (1994) 4 NTLR 185 at 187.2, 190.5.

[10] Ibid, at 191.2, 191.9.

[11]    Disability Services of Central Australia v Regan (1998) 8 NTLR 75-76, per Mildren J, Thomas and Priestley JJ agreeing at 79.

[12]Ibid, at 77.

[13]Lee v MacMahon Contractors Pty Ltd [2018] NTCA 7; 41 NTLR 168; 335 FLR 350, at [43], [44].

[14]Lee v MacMahon Contractors Pty Ltd, at [42].

[15] Ibid, at [61].

[16] Return to Work Act 1986, s 3(1).

[17]AAT Kings Tours v Hughes (1994) 4 NTLR 185 at 191.2.

[18]    Laminex Group Pty Ltd v Catford [2021] at [32], [33].

[19]     Appeal grounds 13-16.

[20]    Disability Services v Regan 1998) 8 NTLR 73 at 79, Thomas and Priestley JJ agreeing at 79.

[21] Work Health Court Rules 1999, r 9.05.

[22]    NT TAB Pty Ltd v Dickin (2004) 14 NTLR 99 at [24] per Thomas J, Mildren and Riley JJ agreeing.

[23]    See the observations in [20] above.

[24]    Joanne Clair Catford v Laminex [2121] NTLC 004 at [68].

[25] Ibid, at [69].

[26]    Substantially as reproduced in [24] above.

[27]Laminex Group Pty Ltd v Catford [2021] NTSC 92 at [35]-[45].

[28]Alexander v Gorey & Cole Holdings Pty Ltd [2002] NTCA 7; (2002) 171 FLR 31, [30].

[29]Alexander v Gorey & Cole Holdings Pty Ltd [2001] NTSC 74, (2001) 163 FLR 227, [33]-[34].

[30]     Return to Work Act 1986, s 53AB.

[31]     Return to Work Act 1986, s 62(2).

[32]     Return to Work Act 1986, s 107.

[33]     See, for example, Josephson v Walker (1914) 18 CLR 691, 701; Forster v Jododex Australia Pty Ltd (1972) 127 CLR 421, 427.

[34]     The Owners of the Ship "Shin Kobe Maru" v Empire Shipping Company Inc [1994] HCA 54; (1994) 181 CLR 404, 421. See also FAI General Insurance Co. Ltd. v. Southern Cross Exploration N.L. [1988] HCA 13; (1988) 165 CLR 268, 283-284, 290; Knight v. F.P. Special Assets Ltd. [1992] HCA 28; (1992) 174 CLR 178, 185, 202-203, 205.

[35]104 Applications

(1) A person may, subject to this Act, commence proceedings before the Court for the recovery of compensation under Part 5 or for an order or ruling in respect of a matter or question incidental to or arising out of a claim for compensation under that Part.

(2)Proceedings under this Division may be commenced before the Court by application in the prescribed manner and form or, where there is no manner or form prescribed, in such manner or form as the Court approves.

[36]    Laminex Group Pty Ltd v Catford [2021] NTSC 92 at [45].

[37] Return to Work Act 1986, s 65(1B)(a).

[38]    Joanne Claire Catford v Laminex [2021] NTLC 004 at [70].

[39]Joanne Claire Catford v Laminex [2021] NTLC 004 at [83].

[40] Ibid, at [102[.

[41] Ibid, at [123]-[124].

[42]        Laminex Group Pty Ltd v Catford [2021] NTSC 92 at [65] – [67].

[43]      Joanne Claire Catford v Laminex [2021] NTLC 004 at [146] – [150].

[44]    Joanne Claire Catford v Laminex [2021] NTLC 004 at [153].

[45]    Laminex Group Pty Ltd v Catford [2021] NTSC 92 at [68].

[46] Ibid, at [72].

[47] Ibid, at [58].

[48]    Laminex Group Pty Ltd v Catford [2021] NTSC 92 at [68].

[49]        Joanne Claire Catford v Laminex [2021] NTLC 004 at [123].

[50]Ibid at [91] for the requirement to identify a “real job”; for the ultimate finding see [153].

[51]    Laminex Group Pty Ltd v Catford [2021] NTSC 92.

[52]    Catford v Laminex [2021] NTLC 004

[53]    Barbaro v Leighton Contractors Pty Ltd (1980) 44 FLR 204.

[54]    Disability Services of Central Australia v Regan (1998) 8 NTLR 73.

[55] Ibid, at 76, per Mildren J; Thomas and Priestley JJ agreeing.

[56]    Lee v MacMahon Contractors Pty Ltd [2018] NTCA 7; 41 NTLR 168, 335 FLR 350 at [21].