Catholic Education Office of WA v Granitto

Case

[2012] WASCA 266

20 DECEMBER 2012


JURISDICTION     :   SUPREME COURT OF WESTERN AUSTRALIA

TITLE OF COURT :   THE COURT OF APPEAL (WA)

CITATION:   CATHOLIC EDUCATION OFFICE OF WA -v- GRANITTO [2012] WASCA 266

CORAM:   PULLIN JA

NEWNES JA
MURPHY JA

HEARD:   9 AUGUST 2012

DELIVERED          :   20 DECEMBER 2012

FILE NO/S:   CACV 137 of 2011

BETWEEN:   CATHOLIC EDUCATION OFFICE OF WA

Appellant

AND

MARK MATTHEW GRANITTO
Respondent

ON APPEAL FROM:

Jurisdiction              :  DISPUTE RESOLUTION DIRECTORATE, WORKCOVER WA

Coram  :COMMISSIONER McCANN

File No  :C 17 of 2011

Catchwords:

Workers' compensation - Psychiatric injury - Appellate principles - Appeal from decision of commissioner - Nature of appeal to the commissioner - Whether appeal 'involves a question of law' - Procedural fairness - Whether commissioner ought to have made a finding on an issue that had not been argued - Incapacity

Legislation:

Workers' Compensation and Injury Management Act 1981 (WA), s 5, s 18, s 21, s 245, s 247, s 254

Result:

Leave to appeal granted
Decision and orders of commissioner set aside
Original orders of arbitrator should be restored

Category:    B

Representation:

Counsel:

Appellant:     Mr D R Clyne

Respondent:     Mr T J Hammond

Solicitors:

Appellant:     CCS Insurance Law

Respondent:     Bradford & Co

Case(s) referred to in judgment(s):

Arnotts Snack Products Pty Ltd v Yacob [1985] HCA 2; (1985) 155 CLR 171

Atanasoska v Inghams Enterprises Pty Ltd [2009] WASCA 17

BHP Billiton Iron Ore Pty Ltd v Brady [2008] WASCA 250

Chief Executive Officer, Department for Child Protection v Hardingham [2011] WASCA 262

Commonwealth v Butler [1958] HCA 56; (1958) 102 CLR 465

Lourey v Legal Profession Complaints Committee [2012] WASCA 112

McPherson v State Print (Unreported, WASCA, Library No 960697, 5 December 1996)

Mitchell v Canal Rocks Beach Resort [2002] WASCA 331

Osland v Secretary, the Department of Justice (No 2) [2010] HCA 24; (2010) 241 CLR 320

Pacific Industrial Co v Jakovljevic [2008] WASCA 60

Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue of the State of Victoria [2001] HCA 49; (2001) 207 CLR 72

Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141

Ward v Corrimal-Balgownie Collieries [1938] HCA 70; (1938) 61 CLR 120

  1. PULLIN JA:  I agree with Murphy JA.

  2. NEWNES JA:  I agree with Murphy JA.

    MURPHY JA

Introduction

  1. This appeal relates to a dispute over workers' compensation.  Leave to appeal is required.  Dr Granitto (the employee) claimed compensation from the Catholic Education Office of Western Australia (the employer) for a mental illness allegedly caused by the treatment of the employee in the employer's workplace.  The matter went to arbitration, where an arbitrator found that the employee was not entitled to compensation.  On appeal, Commissioner McCann reversed that decision.  The employer has appealed the commissioner's decision.

  2. For the reasons that follow, in my view leave to appeal should be given and the appeal should be allowed. 

Background Facts

The employee's employment history

  1. The employee was born in 1962.  He has various tertiary qualifications in the Business field, including a Bachelor degree, a Diploma, a Masters degree and a Doctorate.  Before working for the employer, he was employed in management positions at various organisations within the banking and accounting sector. 

  2. In March 2008, the employee took up a position as team leader of the employer's resources team.  It was a term of his contract that he serve a 6-month probationary period.

  3. The resources team was responsible for the development and management of the employer's resources, which were worth over $900 million.  The employee, as team leader, managed a small number of staff and his role also involved reviewing and re-structuring the resources team.  The employee's superiors included the Director, Chief Financial Officer and an Assistant Director of the employer.

The workplace problems relevant to the claim for workers' compensation

  1. Tensions developed between the employee and his superiors, and between the employee and some of the staff he managed.  Certain incidents occurred, including, relevantly, the following:

    1.In October 2008 the employee's immediate superiors sought to extend his six month probation period by three months, however the employee's permanency was in effect confirmed by the Director of the employer by letter dated 11 November 2008;

    2.The employee had difficulty managing a particular staff member and perceived a lack of support from his superiors to assist him in dealing with the person in question;

    3.In March 2009, a formal complaint of bullying and harassment was made against the employee by the staff member with whom the employee had difficulties.  This complaint led to a protracted independent review.  The employee obtained legal representation for the review and was ultimately cleared of the charges;

    4.Nevertheless, as a result of a recommendation in the independent review, the employee was required to undertake mentoring training to assist with his management style.  However, the employee had not been provided with a copy of the report prepared after the review, and therefore was unaware of why he was required to undertake the training.  The employee was mentored by two different people, the first of whom he did not view as suitably qualified for the role;

    5.The employee was directed not to discipline a staff member for what he believed to be the staff member's departure from work without permission.  In fact, the staff member had been attending a private meeting with a staff harassment officer in relation to the employee's conduct toward her at work;

    6. The second mentor reported details of the discussions between the  mentor and the employee back to the Director.  The employee regarded this as a breach of the understanding he had with both the mentor and the Director;

    7.A meeting occurred in approximately November 2009 between the employee and the Director, during which the employee's behaviour was criticised and the employee was told that the Director was considering moving him from his position as team leader.  The employee was advised to take a week's leave;

    8.In late November 2009, the second mentor undertook a questionnaire survey of the employee's subordinates to learn their opinions of the employee's technical capabilities and management style.  The employee considered that the survey invited or promoted negative feedback;

    9.In December 2009 and January 2010, the employee took leave to complete his PhD.  During this time the employee was replaced as team leader.  It is unclear whether this replacement was intended at the time to be permanent or temporary, as the employee never returned to his duties in any event.  However, on 10 February 2010, the employee was told that he was being permanently replaced, when he attended the office to collect one of his personal items;

    10.The employee wrote an email on 10 February 2010 to the Director expressing grievances about his treatment.  The Director responded with a letter dated 16 February 2010 in which the Director warned the employee that he had to meet with the mentor regarding the outcome of the team survey, or his contract of employment would be terminated; and 

    11.The employee did meet with the mentor but the meeting was not satisfactory from the point of view of either the employer or the employee.  The Director wrote to the employee on 2 March 2010, again requiring the employee to meet with the mentor to discuss the outcomes of the team survey, and in effect threatening him with dismissal if he did not.  The employer's position on this was reiterated in a letter from the Director to the employee dated 8 March 2010.

  2. On 9 March 2010, a general practitioner certified that the employee was unfit for work from 2 March 2010 due to depression. 

The claim for compensation - the originating process and reply

  1. The employee lodged a Workers' Compensation Claim Form dated 10 March 2010 (BB 204) alleging 'psychological ill health induced by the CEO's mistreatment of me over an extended period of time'. 

  2. The claim was disputed by the employer and the employee lodged an Application to Resolve a Dispute in the Dispute Resolution Directorate of WorkCover Western Australia on 20 July 2010 (BB 149). The application sought orders under s 58 of the Workers' Compensation and Injury Management Act 1981 (WA) (the Act). Statutory payments and weekly payments from '16/4/2010 to ongoing' were claimed (BB page 153 ‑ 154).

  3. The employer lodged a 'Reply to Part XI Application to Resolve a Dispute' (BB 228) on 30 July 2010.  The employer disputed that the employee was entitled to the relief claimed, or any relief at all, and contended, inter alia that:

    (a)the employee had not sustained an injury as defined by the Act;

    (b)if the employee did suffer a psychiatric condition, it had not been caused by or significantly contributed to by the employee's employment with the employer;

    (c)if the employee's employment with the employer had contributed to a significant degree to the alleged injury, it was disputed that any total or partial incapacity for work or need for treatment of a kind referred to within sch 1 cl 17 of the Act existed; and

    (d)if the employee suffered from a work-caused psychiatric condition as alleged, the employee was precluded from any entitlement by virtue of the exclusions contained within s 5(4) of the Act on the basis that the condition arose out of the employee's expectation of a matter or of a decision by the employer in relation to a matter referred to in s 5(4)(a) and/or (b) of the Act.

  4. The matter went to arbitration before Arbitrator Birkelbach (the arbitrator).

Relevant provisions of the Act - injury and incapacity

  1. Before discussing the hearing before, and the findings made by the arbitrator, it is convenient to set out the relevant provisions of the Act relating to injury and incapacity, and related authorities.

  2. By s 18 of the Act, an employer is liable to pay compensation 'if an injury to a worker occurs'. 'Injury' is defined in s 5 of the Act and includes:

    c)a disease contracted by a worker in the course of his employment at or away from his place of employment and to which the employment was a contributing factor and contributed to a significant degree;

    ...

    but does not include a disease caused by stress if the stress wholly or predominantly arises from a matter mentioned in subsection (4) unless the matter is mentioned in paragraph (a) or (b) of that subsection and is unreasonable and harsh on the part of the employer.

  3. Section 5(4) reads:

    For the purposes of the definition of injury, the matters are as follows -

    (a)the worker's dismissal, retrenchment, demotion, discipline, transfer or redeployment;

    (b)the worker's not being promoted, reclassified, transferred or granted leave of absence or any other benefit in relation to the employment; and

    (c)the worker's expectation of -

    (i) a matter; or

    (ii) a decision by the employer in relation to a matter,

    referred to in paragraph (a) or (b).

  4. 'Disease' is defined by s 5(1) to include any 'mental ailment, disorder ... whether of sudden or gradual development'.

  5. Section 5(5) provides:

    In determining whether the employment contributed, or contributed to a significant degree, to the contraction, recurrence, aggravation or acceleration of a disease for purposes of the definitions of injury and relevant employment, the following shall be taken into account -

    a)the duration of the employment;

    b)the nature of, and particular tasks involved in, the employment;

    c)the likelihood of the contraction, recurrence, aggravation or acceleration of the disease occurring despite the employment;

    d)the existence of any hereditary factors in relation to the contraction, recurrence, aggravation or acceleration of the disease;

    e)matters affecting the worker's health generally; and

    f)activities of the worker not related to the employment.

  6. With respect to s 5(4)(c) of the Act, in McPherson v State Print (Unreported, WASCA, Library No 960697, 5 December 1996), Steytler J (with whom Parker J agreed) said:

    Plainly, if no decision has yet been made as to one or more of the nominated matters, the worker must, where a decision of that kind is anticipated by him or her, necessarily be left in a state of uncertainty in which the fear of one or more of those matters arises. That fear might, in turn, bring about a disease caused by stress. It is in that context that the word 'expectation' is used. That being so, it seems to me, it is unnecessary to establish, before the exclusion in subs5(4)(c) takes effect, that one or other of the nominated matters was thought to be 'likely' to happen. It is enough that the worker's stress related disease is caused predominantly by a fear that any one of the enumerated matters will or might happen, or by the uncertainty created by the worker's belief that a decision is to be made or might be made by the employer on the question whether it will or will not happen. This remains so even if the worker is unable to say that one matter is more likely to happen than any other of those matters. It also remains so even if that worker is unable to say whether the happening of that matter, or the making of a particular decision as to that matter, is more likely than that none of the enumerated matters will happen or that no such decision will be made.

  7. Section 18 of the Act provides that subject to the Act, if an injury to a worker occurs, an employer is liable to pay compensation to a worker in accordance with sch 1 of the Act. By s 21 of the Act, the employer must pay compensation from the date of 'incapacity' resulting from the injury, although cl 9 of sch 1 (concerning medical expenses) applies in any event.

  8. Accordingly, in order for an employee to obtain weekly compensation payments, it is necessary to establish incapacity as well as injury.  In Ward v Corrimal-Balgownie Collieries [1938] HCA 70; (1938) 61 CLR 120, 129, Latham CJ observed (relevantly) that compensation is not payable in respect of an injury itself, but rather in respect of total or partial incapacity resulting from an injury. As Windeyer J observed in Commonwealth v Butler [1958] HCA 56; (1958) 102 CLR 465:

    In all the various forms which workers' compensation legislation takes the liability of the employer arises when there are, firstly, a connexion between the worker's employment and the injury he suffered, and, secondly, a connexion between that injury and his incapacity (478).

  9. The burden of proving incapacity lies on an employee:  Mitchell v Canal Rocks Beach Resort [2002] WASCA 331 [55]. 'Incapacity' is not defined in the Act. In Arnotts Snack Products Pty Ltd v Yacob [1985] HCA 2; (1985) 155 CLR 171, 178, the majority of the High Court held that the concept of partial incapacity for work is that of reduced physical capacity, by reason of physical disability, for actually doing work in the labour market in which the employee was working or might reasonably be expected to work.

  10. It should be noted that no question arises in this appeal, or has arisen in the proceedings below, as to whether any matter arising under s 5(4)(a) or (b) was 'unreasonable and harsh on the part of the employer' for the purposes of the definition of 'injury' in s 5.

  11. Further, for ease of reference in these reasons, I will refer to the matters set out in s 5(4)(a) and (b), and a 'decision by the employer' in relation to such matters within the meaning of s 5(4)(c)(ii), as 'excluded matters'. Also, and consequently, in these reasons, an 'expectation of excluded matters' is a reference to an expectation within the meaning of the term 'worker's expectation' in s 5(4)(c).

The hearing before and decision of the arbitrator

  1. The dispute was heard before the arbitrator on 9 and 10 February 2011.  At the hearing, three witnesses gave oral evidence: the employee, the Director of the employer and the employer's in-house legal counsel.  The arbitrator published his reasons and ordered that the employee's application be dismissed on 19 April 2011.  The 'certificate of outcome' contained the following summary:

    Attached are my reasons for issuance of the following order.  In brief the applicant was found to have proven that his employment contributed significantly to the onset of a stress‑related disease.  However, he was found not to be credible on matters relating to expectations of matters in 5(4) and it was not possible to identify whether his expectations, either wholly or predominantly, were the cause of his disease.  Having failed this onus upon him the applicant was not able to establish that he has an 'injury' as defined.

Reasons for decision

  1. The arbitrator stated that discussions between the parties' representatives and the arbitrator had 'confirmed that the primary argument of the [employer] was that the [employee] was disentitled to compensation due to the [employee's] expectations of matters in section 5(4)' (arbitrator's reasons [6], see also [23]).

  2. The arbitrator held that it was straightforward to conclude that as of 9 March 2010, the employee was suffering from 'a major depression with associated anxiety'. The injury crystallised in March 2010, and there was no satisfactory evidence upon which it could be found that the employee had the injury prior to March 2010 (arbitrator's reasons [9] ‑ [10]). The next step was to determine whether the employment was a contributing factor and 'contributed to a significant degree' to the injury. In so doing, the arbitrator examined all the factors in s 5(5) of the Act. As a result of his examination of those factors, the arbitrator found that it was 'quite easy … to conclude and find that there were no obvious non-employment-related causes of the [employee's] disease' (arbitrator's reasons [18]). The arbitrator said, however, that this finding in itself was insufficient to establish that the employment significantly contributed to the onset of the employee's injury (arbitrator's reasons [19]).

  3. The arbitrator noted the matters which the employee alleged led to the development of his injury. They were, in effect, the matters enumerated in 1 ‑ 11 in [8] above. He also noted that there was no dispute about the occurrence of these matters, but there was a dispute about whether they were excluded matters under s 5(4) of the Act. The arbitrator found that the lack of dispute over the occurrence of the matters, coupled with the finding that there were no non-employment-related causes of the employee's injury, allowed him to 'easily conclude that the employment has contributed and contributed significantly to the contraction of the [employee's] found disease'. The arbitrator accepted 'the thrust of the [employee's] claim that [these] events/circumstances ... collectively contributed to the contraction of his major depression with anxiety'. (See arbitrator's reasons [21] ‑ [22]).

  4. The arbitrator said that several of the matters relied upon as causative of the employee's injury potentially fell under s 5(4) of the Act, such as potential dismissal or demotion. He referred to the proposed extended period of probation; the loss, or threat of loss, of the position as team leader; the explicit threat of dismissal for the failure to 'attend upon' the second mentor; and the employee's apprehension that the employer was trying to 'get him' as signifying an expectation of dismissal or demotion (arbitrator's reasons [24]).

  5. The arbitrator also considered the medical evidence as to whether the employee had concerns over discipline and the threat of sacking which may have contributed to his injury (arbitrator's reasons [25] ‑ [28]).  The employee's medical evidence was to the effect that the employee's injury was not related to any exclusions under the Act.  The arbitrator rejected the employee's medical evidence on the basis that it was 'too cryptic' to be of assistance.  The employer's medical evidence, on the other hand, included evidence to the effect that there was 'significant causative contribution' from the employee's concerns over being disciplined, having his probation period extended, and from the threat of sacking if he did not fully participate in performance management.  The arbitrator regarded this evidence as 'somewhat clearer but still not sufficiently so to be determinative of causation'.  The arbitrator said that it was not possible to decide, simply on the basis of the medical evidence, the relevant contribution of 'general employment circumstances' and expectations of excluded matters.  He said that a 'decision must be made on a consideration of the evidence as a whole with particular regard to the testimony of witnesses at the arbitration hearing' (arbitrator's reasons [28]). 

  1. The arbitrator then considered the meaning of 'expectation' in s 5(4) of the Act. He said that there would be a relevant expectation where a worker has considered one or more possible outcomes and had 'made an assessment of at least a significant possibility of a particular outcome of the type described in s 5(4) occurring' (arbitrator's reasons [29]). At an evidentiary level, he considered that an expectation may be found through 'logical inferences which would show the person acted as if the expectation existed' (arbitrator's reasons [30]).

  2. The arbitrator did not accept the employee's evidence that he had not assessed the likelihood of the occurrence of excluded matters under s 5(4) of the Act. He formed the 'strong view' that the employee's evidence was 'tailored by him to maximise his chances of obtaining compensation and was not truthful about his beliefs/expectations in regard to situations in which an expectation of a matter could have disentitled him' (arbitrator's reasons [31] ‑ [32]). The arbitrator found, in effect, that the employee did have an expectation of discipline or other matters set out in s 5(4) of the Act concerning threats to his continued employment (arbitrator's reasons [33] ‑ [35]). In this regard, the arbitrator referred, amongst other things, to the protracted inquiry into the alleged bullying of the staff member by the employee and said:

    The [employee] did not give evidence that he expected an unfair inquiry or that he had any basis to believe it was going to be unfair. He was ultimately found not to have bullied or harassed [the staff member] but, rather, to have lacked the necessary management skills to properly deal with her. In my view the only logical inference is that the [employee] throughout the period of inquiry became more anxious because of either continual or increasing uncertainty as to the outcome and effect of the inquiry. As proven bullying and harassment claims are generally matters which can have adverse employment effects attached, this possibility was almost certainly in the mind of the [employee] [33].

  3. The arbitrator also referred to the attempt to extend the employee's period of probation and said:

    On 24 October 2008, according to his witness statement, he was highly stressed by a meeting he had with them in which they attempted to unilaterally extend the period of probation of six months which had been part of his contract of employment. His witness statement indicates he considered this earlier meeting to have been for the purpose of terminating him. Although he attempted to give evidence contrary to his witness statement as to his contemporary thoughts, his witness statement, in my view, accords with reasonable expectations given the circumstances and I believe and do find it more accurately reflects his contemporary state of mind, ie he held some level of expectation of threat to his continued employment. I further consider that this situation likely covered his later impressions of what was happening to him in the workplace and what he believed were the driving forces in the Office [34].

  4. The arbitrator also noted that the employee bore the onus of proving that the stress did not arise either wholly or predominantly from matters set out in s 5(4) of the Act. He said, in effect, that given that it could be inferred from the evidence that the employee did have expectations of excluded matters, and having found that the employee did not give credible evidence as to his expectations with respect to the events in question, he could not exclude the possibility that the employee's expectations of excluded matters extended to the way that he dealt with his mentoring arrangements, and with his employer more generally. Accordingly, the arbitrator said, in effect, that he could not be satisfied that the employee's condition was not wholly or predominantly caused by his expectations of excluded matters. The employee had thus not established that he was 'not disentitled' by s 5(4) of the Act and his application was therefore dismissed (arbitrator's reasons [36] ‑ [37]).

The appeal from the arbitrator's decision to Commissioner McCann

  1. The employee lodged an application dated 16 May 2011 for leave to appeal against the arbitrator's decision.  The grounds of appeal were, in essence, that the arbitrator erred in law in that:

    (1)his reasons for decision were inadequate;

    (2)he took into account irrelevant considerations;

    (3)he took into account documents that had not been formally received into evidence; and

    (4)he misdirected himself as to, and misapplied, the relevant test of 'expectation' in that:

    (a)he applied a subjective test to the determination of what constitutes an 'expectation'; and

    (b)he made an 'ultimate finding about an expectation of possible discipline that was not open to him on the evidence'.

  2. In his 'annexure to application for leave to appeal against decision of an arbitrator', the employee included a heading entitled 'orders sought'.  Only one order was listed under this heading, and that was that 'the arbitrator's decision be quashed and the application remitted to a different arbitrator for re-hearing according to law'. 

  3. The appeal was heard before the commissioner on 4 August 2011 and his Honour's reasons were delivered on 17 October 2011. 

  4. On the question of whether leave should be granted to appeal, his Honour said [33]:

    The question of leave to appeal falls to be considered pursuant to s247(2)(a) of the Act. I am satisfied that the pecuniary requirements of sub‑paragraph (a)(i) have been satisfied that leave to appeal should be granted in respect of any meritorious ground which involves a question of law (including a mixed question of fact and law).

  5. The commissioner found in terms that grounds 2 and 3 had 'no merit' and should be 'dismissed'.  His Honour also found that ground 1 and the first limb of ground 4 should be 'dismissed' and thereby found, in effect, that those grounds were not meritorious either.  His Honour, however, upheld the second limb of ground 4.  Having regard to his Honour's reasons at [33], quoted above, his Honour, as I understand it, thereby granted leave to appeal in relation to the second limb of ground 4 only.

  6. His Honour said, in relation to the second limb of ground 4, at [16], [40] and [42]:

    The onus of proving that a potentially excluded matter (or the expectation of the same) is not the only or predominant cause of a stress‑related illness lies on the worker (see O'Leary v Edith Cowan University CM 108‑02 per Compensation Magistrate Packington at [14]).  In my opinion, that onus can be discharged in a multi‑factorial stress‑claim by proving that the excluded matters (and expectations of the same) were not the predominant factors which, in turn, can be established by proving that there was no predominant factor.

    ...

    In paragraph 36 the arbitrator simply reasoned that the possibility that Dr Granitto's excluded expectations 'extended' to the way in which he was dealing with his mentoring arrangements and his employer generally entailed that it was impossible for him to discharge his onus of proof ... In effect he held that the expectations of some excluded matters were causally significant and then held that that was sufficient for Dr Granitto to fail.  This was a generalisation and in my opinion the arbitrator fell into error.  He was required to make a common‑sense, factual appraisal of the nature and relative importance of each of the stressors and determine if any one or more excluded matters predominated.

    ...

    There are numerous other instances in the reasons in which the arbitrator failed to consider the possibility of non‑excluded perceptions co‑existing with excluded expectations.

  7. The commissioner referred to certain passages of evidence and said, with respect to the arbitrator's finding as to credibility [47]:

    In the arbitrator's view, Dr Granitto was tailoring his evidence in this passage in order to avoid making an obvious concession against interest in respect of an excluded expectation.  (There was another very similar exchange in relation to factor (a):  tl/68‑70 and 117‑8).  Allowing for the fact that the arbitrator was present, I have difficulty with [his] construction of the evidence and thus the weight of [his] findings both as to [the employee's] credibility and as to him having certain expectations. ... [C]ounsel and Dr Granitto were at cross‑purposes and any impasse was not entirely of Dr Granitto's creation or desire, as the arbitrator made out.  Overall, the evidence actually indicates that Dr Granitto was at all times very candid about excluded matters or his expectations of the same stressing him.

  8. His Honour found that the arbitrator's adverse finding on credibility 'must be regarded with caution' but found that in any case the finding did 'not translate to other factual issues' [48].

  9. The commissioner then decided, in effect, that there were three 'primary causal factors' operating in the November 2009 to March 2010 period:

    (a)the employee's expectation of excluded matters - possible demotion or redeployment, with the threat of termination or discipline only operating at the very end of that period;

    (b)the employee's perception that he was not supported or appreciated and was undermined and victimised; and

    (c)the mentoring that the employee was required to undertake, which he believed was unhelpful and prejudicial, and the related issue of confidentiality [51].

  10. His Honour considered that none of the 11 individual 'stressors' was 'the main, the stronger or the leading element in the causal process'. However, he then stated that the 'mentoring problem' was 'one of the stronger, main or leading causes of [the employee] falling ill' [67]. His Honour considered that the non-excluded matters contributed to the injury as much as the excluded matters [66] ‑ [67]. In the commissioner's opinion, the employee:

    At least established that there was no single or predominant stressor and was entitled to succeed. If anything, he established that such expectations that he may have had of redeployment, retrenchment, discipline, demotion, transfer or termination (or the reality of the same) were not predominant causes of his illness [69].

    His Honour said that for these reasons, the employee's injury was 'a compensable injury under the Act' [70].

  11. As to the question of law in the appeal in respect of which the commissioner identified error, his Honour expressed it thus:

    In my opinion the arbitrator mis‑directed himself as to the proper approach to the assessment of the relative predominance of the various stressors (see [40] above) because he resorted to generalisations instead of an assessment of the relevant causal potency of the various factors. I further find that the arbitrator took a very superficial approach to the subs (4)(c) issue when a multi‑dimensional matrix of causal constructs and pathways was open on the evidence and needed to be considered along lines similar to what I have done above. In short, he failed to consider further relevant findings which were open on his own findings and on the evidence [53].

  12. His Honour concluded [73] that for the reasons he had given, leave to appeal should be granted and the appeal should be allowed.  As noted earlier, the grant of leave and the upholding of the appeal related to the second limb of ground 4 only.

  13. On 4 November 2011 a notice of appeal was lodged in this court to appeal the commissioner's decision.

Nature of the appeal to the commissioner

  1. Relevantly for present purposes, the following provisions of the Act applied to appeals from arbitrators.

  2. Section 247 appeared within pt XIII of the Act that was headed 'Questions of law and appeals'. By virtue of s 245(1)(a) of the Act, the provisions of pt XI of the Act (div 4 of which relates to arbitrations) applied to the commissioner on appeal 'as if references in Part XI to an arbitrator were references to the commissioner', unless a contrary intention appeared. By s 245(1)(b) of the Act, the commissioner 'has and may exercise or perform all of the powers, duties, responsibilities, authorities and jurisdictions of an arbitrator'.

  3. A party may, with leave of the commissioner, appeal against a 'decision' made under pt XI: s 247(1). An appeal 'is to be by way of review of the decision appealed against': s 247(5). Leave to appeal is not to be granted unless, relevantly 'a question of law is involved' in the appeal: s 247(2). Section 247(3), which has no present application, applies specifically to an appeal from a decision of an arbitrator on a matter referred under s 93D(10) ie the degree of disability for the purposes of claiming common law damages.

  4. Evidence that is fresh evidence or evidence in addition to, or in substitution for the evidence before the arbitrator, cannot be given on an appeal except with the leave of the commissioner: s 247(6). On hearing an appeal, the commissioner may affirm, vary or quash the decision appealed against, or substitute and make in addition, any decision that should have been made in the first instance: s 247(7)(a). Also, on the hearing of an appeal, the commissioner may (subject to s 267, concerning in effect, costs against a worker) make any further or other decision as to costs or otherwise, as the commissioner 'thinks fit': s 247(7)(b).

  5. It is unnecessary to explore exhaustively the operation of s 247. For the purposes of the disposition of this appeal, the following propositions may be noted.

  6. An appeal 'involves' a question of law where either an error of law, or an error of mixed law and fact, is involved:  BHP Billiton Iron Ore Pty Ltd v Brady [2008] WASCA 250 [3]; Atanasoska v Inghams Enterprises Pty Ltd [2009] WASCA 17. (An appeal of this kind is accordingly broader than an appeal 'on a question of law' ‑ as to which, see [65] below.)

  7. If no question of law can be identified in the appeal as arising from an arbitrator's decision, there is no jurisdiction in the commissioner to grant leave to appeal:  Pacific Industrial Co v Jakovljevic [2008] WASCA 60 [17]. That was a case involving s 247(3) but the point plainly applies to s 247(2) which uses the word 'unless'. It is unnecessary for present purposes to consider whether there are any differences in relation to the operation of the grant of leave contemplated under s 247(2) and s 247(3).

  8. Further, in Atanasoska Buss JA (Wheeler and Pullin JJA agreeing) said [21]:

    If a ground of appeal by a party, properly analysed, does not involve a question of law, linguistic gymnastics in the formulation of the ground cannot alter the position. A ground that asserts a decision is against the evidence and the weight of the evidence does not raise an issue involving a question of law. A court, tribunal or statutory decision-maker does not make an error of law merely because the court, tribunal or decision-maker finds facts wrongly or upon a doubtful basis. Generally see Paridis v Settlement Agents Supervisory Board [2007] WASCA 97 ; (2007) 33 WAR 361 [53] ‑ [55] and the cases there cited.

    Later in Atanasoska [32], the court referred with approval to the observations of Pullin JA in BHP Billiton Iron Ore Pty Ltd v Brady [14]:

    In plain cases it might be appropriate to deal with the application for leave to appeal before considering the proposed grounds of appeal, but experience is likely to show that in most cases the application for leave to appeal, and the appeal should be heard together and the question of leave dealt with after considering the merits of the proposed grounds of appeal. If the proceedings are conducted in that way, the commissioner will then be in a position at the end of the hearing to either:

    (a)grant leave and uphold or dismiss the appeal, or

    (b)refuse leave to appeal.

    Pullin JA also said in that case [15] that the 'commissioner was not bound to accept that questions of law were involved merely because the appellant asserted there were such questions'. 

  9. It has been held that an appeal under s 247 is neither a hearing de novo, nor an appeal in the 'strict sense', and that the commissioner, within the constraints marked out by the nature of the appellate process, must conduct a 'real review': Pacific Industrial Co v Jakovljevic [20], [24].

  10. Where leave is granted and a review is undertaken, the appellant must still, for the purposes of the review, provide a proper basis for disturbing the arbitrator's decision by pointing to some error in it; the appellant may not simply invite the commissioner just to ignore the arbitrator's decision and start again with a view to having the commissioner substitute his or her own decision for that of the arbitrator:    Pacific Industrial v Jakovljevic [20], [26].

The grounds of appeal in this court and preliminary observations

  1. There are three grounds of appeal (the second was amended with leave).  In summary, it is alleged that:

    1.the commissioner erred in finding that the employee was incapacitated and entitled to weekly payments of compensation and ongoing statutory allowances, because:

    (a)The issue of incapacity was not live nor addressed by either party on appeal; and

    (b)No reasons were given for the determination of incapacity.

    2.the commissioner erred in law in concluding that the arbitrator had misdirected himself as to the manner of his assessment of causation and in particular the commissioner's conclusion that the arbitrator had applied a too generalised approach to the issue and that a 'multi dimensional matrix of causal constructs and pathways' was required; and

    3.the commissioner erred in overturning the arbitrator's findings, which were based on credibility, and in making his own findings on credibility.

  2. In relation to ground 2 in this appeal, it is to be noted that the second part of ground 4 of the appeal to the commissioner (see [35(4)(b)] above), which the commissioner upheld, alleged in effect, that the arbitrator's finding of an expectation of an excluded matter (ie discipline) was not open on the evidence.  The question of law involved in this aspect of the appeal to the commissioner would appear to have been the alleged absence of evidence to support the finding of fact of a relevant expectation.  

  3. His Honour appears not to have addressed that ground on the basis of whether there was any evidence to support the finding of an expectation of an excluded matter.   He appears to have accepted that there was some evidence of an expectation of possible discipline but that the expectation only arose at the very end of the period up to March 2010.  His Honour further found that there was an expectation of other excluded matters, which was amongst the three 'primary causal factors' over the period between November 2009 to March 2010 in relation to the employee's stress.  His Honour then went on to consider whether the employee's expectation of these excluded matters was a predominant cause and decided that it was not. 

  4. The employer does not contend in this appeal that his Honour failed to direct himself to the particular question raised by the employee in the second limb of ground 4 of the appeal before the commissioner.  Rather, by ground 2 in this appeal, the employer confines its complaint to the alleged error in the question of law identified by the commissioner as warranting the upholding of the employee's appeal.

  5. In relation to the question of law identified and answered by the commissioner at [53] of his reasons, it appears that his Honour considered that as there was evidence from which the arbitrator could (in the commissioner's opinion) have concluded that the employee's stress did not predominantly arise from an expectation of an excluded matter, the arbitrator must have misdirected himself as to the proper approach to the statutory task.  For the reasons given later, in my respectful view, it was not open to the commissioner to conclude that the appeal involved a question of law on that basis.

Legal principles relating to the appeal to this court

  1. For present purposes, by s 254 of the Act, a 'party to a proceeding before the Commissioner may by leave of the Court of Appeal appeal to the Court of Appeal from a decision of the Commissioner in the proceeding on a question of law'.

  2. It is to be noted that s 254 of the Act has been amended by s 19 of the Workers' Compensation and Injury Management Amendment Act 2011, which came into effect (for the purposes of this section) on 1 December 2011.  By that amendment, an appeal may be made to the Court of Appeal but it 'must relate' to a question of law, and leave to appeal must be obtained. However, the appeal notice in this matter was filed on 4 November 2011, before the amendment, and the parties agreed that it is the previous version of s 254 of the Act which must be considered (ts 25 ‑ 26). It is accordingly unnecessary to consider, for present purposes, the difference, if any, between an appeal on a question of law and an appeal which must relate to a question of law.

  3. An appeal 'on a question of law' is not an appeal by way of rehearing; it is in the nature of judicial review, which challenges the legal correctness of what the lower court has done.  See Osland v Secretary, the Department of Justice (No 2) [2010] HCA 24; (2010) 241 CLR 320 [18], [20] ‑ [21]; Roy Morgan Research Centre Pty Ltd v Commissioner of State Revenue of the State of Victoria [2001] HCA 49; (2001) 207 CLR 72 [15]; Chief Executive Officer, Department for Child Protection v Hardingham [2011] WASCA 262 [43]; Lourey v Legal Profession Complaints Committee [2012] WASCA 112 [27].

  4. Without intending to be exhaustive, it would seem to me that an appellant seeking leave to appeal under s 254 on a question of law to this court from a commissioner's decision, would generally seek to identify questions along the following lines:

    (a)whether the commissioner erred in law in finding that there was, or was not (as the case may be) a question of law involved in the appeal to the commissioner;

    (b)if leave were properly granted, whether the commissioner erred in law by misconceiving the nature of the statutory task of a 'review' within the meaning of s 247(5) of the Act;

    (c)even if the commissioner did not misconceive the statutory task of review, whether he or she made an error of law in undertaking a review.

Disposition

  1. Ground 1 is a natural justice point and is more conveniently dealt with separately at the end of these reasons.  Grounds 2 and 3 are, to some extent, related.  It is convenient to commence with a consideration of ground 2.

Ground 2

  1. As I understood it, the employer in effect contended that there was evidence open to the arbitrator to reach the conclusion that the employee had not established that his stress did not predominantly arise from the expectation of excluded matters, and that this was a question of fact only.  It also contended that, properly construed, the Act did not require the arbitrator to have regard to 'a multi‑dimensional matrix of causal constructs and pathways'.  It was also submitted that the commissioner's finding of compensable injury could not properly be made as it involved setting aside the arbitrator's finding of fact as to credibility.

  2. The employee submitted that the arbitrator's finding was erroneous and that accordingly, the commissioner had not erred in his assessment of the arbitrator's approach to causation or in relation to the 'real review' undertaken by the commissioner (employee's supplementary submissions [4]). The employee argued that the arbitrator did not apply his findings in relation to the cause of the employee's injury to the statutory test prescribed in s 5(4) of the Act, and did not weigh the competing causes of the stress (employee's supplementary submissions [19], [23]). Nor, it is argued, did the arbitrator undertake an analysis of why the employee failed to discharge his onus of proof (employee's supplementary submissions [26]) or explain how his adverse finding on credit impacted upon causation (employee's supplementary submissions [28]). The employee submitted that given the error of law on the part of the arbitrator, it was open to the commissioner to conduct a 'real review' and make his own decision (employee's supplementary submissions [33] ‑ [34]).

  3. There was no real dispute that the employee's injury was caused by stress associated with certain events. The arbitrator correctly recognised that he was required to consider whether the stress arose from excluded matters or the employee's expectation of excluded matters. The arbitrator made findings to the effect that the employee did have an expectation of possible discipline and of other matters concerning threats to his employment for the purposes of s 5(4) of the Act (arbitrator's reasons [33] ‑ [35]). Those findings were open on the evidence and the commissioner, as I understand it, has not found to the contrary. It was then necessary for the arbitrator to be satisfied that the expectation of excluded matters was not the whole or predominant cause of the employee's stress. The arbitrator said that the onus was on the employee to prove that it was not the sole or predominant cause. That statement of the law in relation to the onus was not disputed by the employee.

  4. After examining all the evidence, including the medical evidence and the evidence of expectations (or lack thereof) given by the employee (which the arbitrator rejected) the arbitrator found that the employee had 'failed [to discharge] the onus' (arbitrator's reasons [36]).  The arbitrator found, in effect, that it was not possible for him to conclude from the evidence that the expectations of excluded matters were  not the whole or predominant cause of the employee's stress.  That finding was made in the following context. 

  5. The employee addressed the issue of his expectations with respect to excluded matters in his oral evidence, including evidence‑in‑chief.  His case was not that whilst he had expectations of excluded matters, his stress did not predominantly arise from those expectations.  Rather, the employee denied having any expectation of excluded matters.  The thrust of his case was that he did not have any expectations of such matters at all.  (See, eg, par 3 of his witness statement, BB 210, and oral evidence GB 18 ‑ 19, 40 ‑ 42, 52 ‑ 53, 60 ‑ 63, 74, 104 ‑ 106).  Nevertheless, in the course of cross‑examination, he did acknowledge at one point that he was 'anxious' when he felt that he was under threat of dismissal following the employer's letter of 16 February 2010 (GB 75). 

  6. The contribution that his expectations of excluded matters made to his levels of stress at the time could, no doubt, have been the subject of direct evidence by the employee had it not been for his evidence that he had no relevant expectations.  The two were, in practical terms, inconsistent.  Once the arbitrator rejected the employee's evidence that he had no relevant expectations, the question left for the arbitrator was whether, based on the other evidence in the case, including the medical evidence, an inference should be drawn that the employee's stress did not predominantly or wholly arise from the relevant expectations.

  7. The weighing of the evidence by the arbitrator was in a context in which the inference sought to be drawn in favour of the employee was on a topic on which the employee could have given direct evidence if he acknowledged that he had expectations of excluded matters, and where the arbitrator found that the employee's evidence that he had no such expectations lacked credibility.

  8. The question whether the inference ought to be drawn was a question of fact only for the arbitrator.  It could not be said, in my view, that because the arbitrator was not prepared to draw that inference, he must have misdirected himself in law as to the proper approach to the statutory task.

  9. In my view, there was no question of law arising from the arbitrator's decision as identified by the commissioner, and the commissioner erred in granting leave to appeal on the basis that there was a question of law involved in the appeal in that regard.  I would uphold ground 2.

  10. Having regard to my conclusion with respect to ground 2, it is unnecessary to determine ground 3 as a separate matter.

Ground 1

The ground and the arguments

  1. By ground 1 the employer contends, in effect, that it was not afforded procedural fairness in that the commissioner made a finding of incapacity when the issue was not a live one before the commissioner and the issue had not been argued (the procedural fairness point).  It also contends that the commissioner, in any event, failed to provide adequate reasons for the finding of incapacity (the reasons point).

  2. The employee's original contention in relation to the procedural fairness point was that the commissioner had not in fact made any finding of incapacity. However, the commissioner did order the employer to make weekly payments and those payments could not have been ordered unless there was a finding of incapacity (see [20] ‑ [21] above). In the course of the oral hearing, the employee in effect, withdrew the submission that the commissioner had not found incapacity, and accepted that such a finding had at least implicitly been made. Instead, the employee contended that the commissioner was entitled to make a finding of incapacity by virtue of s 247 of the Act. It was also said that the finding was made in the context that the employer had conceded, in the proceedings before the arbitrator, that if injury were established, then incapacity would flow from the date of the injury (appeal ts 75 ‑ 76). Although not put in these terms, I understood that to be a submission to the effect that because of the concession made by the employer in the arbitration below, any failure by the commissioner to allow the employer to address the issue of incapacity before making orders on the appeal in that regard, could have made no possible difference to the result: Stead v State Government Insurance Commission [1986] HCA 54; (1986) 161 CLR 141, 146.

  3. The employer denied making any such concession (appeal ts 79). 

The relevant history concerning the issue of capacity

  1. Ground 1 requires some understanding of what happened in relation to the issue of incapacity in and following the hearing before the arbitrator and the appeal to the commissioner.

  2. The employer had contested, in the arbitration proceedings, the issue of incapacity in its reply to the application (see [12] above).  At the hearing before the arbitrator, the issue of incapacity was the subject of cross‑examination and exchange between both counsel and the arbitrator (GB 81, 97).

  3. The arbitrator in his reasons recorded the pleaded dispute as to incapacity (arbitrator's reasons [2(c)]). The arbitrator nevertheless recorded [6], that in discussions with the parties, the employer's 'primary argument' was directed to the application of s 5(4) of the Act, and there was agreement that there was 'really only one key issue', being the application of s 5(4) [23]. The arbitrator dismissed the employee's application on that basis. The arbitrator made no findings on incapacity, presumably as a result of dealing with the application on the basis of s 5(4). This was recognised by the commissioner, when he said in his reasons at [21] that:

    Having found against [the employee] in relation to causation, the arbitrator did not address this issue of [the employee's] incapacity. 

  4. In the application for leave to appeal to the commissioner, the employee did not seek orders for the commencement of weekly payments.  Rather, he sought an order that the arbitrator's decision be quashed and that his application be remitted to a different arbitrator for rehearing.

  5. Having found the error which he did, the commissioner initially did not remit the employee's application for rehearing to an arbitrator.  At [71] of his reasons, the commissioner said in effect, that he would not make a 'final ruling' on incapacity, but would make an 'interlocutory' determination with a view to the parties seeking to agree 'quantum' informally. 

  6. At [73] of his reasons, his Honour said that he made orders as follows:

    1.Leave to appeal is granted.

    2.The appeal is allowed.

    3.The order of the arbitrator made on 19 April 2011 is quashed and in lieu thereof it is ordered as follows:

    i.The [employer] shall pay weekly payments to [the employee] from 2 March 2010, with liberty to apply to myself as to quantum.

    ii.The [employer] shall pay statutory expenses incurred by [the employee] from 2 March 2010 and continuing.

    iii.There is liberty to apply as to the costs of the proceedings under Part XI.

    4.There is liberty to apply as to the costs of the application for leave to appeal and the appeal.

  7. Order 3 involved, in effect, a determination that the injury found by the commissioner resulted in incapacity within the meaning of s 21 of the Act.

  8. On 23 November 2011, the commissioner heard the parties in relation to 'quantum'.  The employer submitted, in effect, that the employee had not asked for an order for the commencement of payments and that the question of the employee's incapacity was never canvassed in the appeal.  The employer sought an indefinite adjournment of the proceedings before the commissioner pending an appeal to this court, or alternatively, the countermanding of order 3 on the basis that the issue of incapacity be remitted to an arbitrator 'for the factual issues to be dealt with' (BB 43 ‑ 47). 

  9. The employer also submitted that the commissioner should not deal with the matter in relation to incapacity on the basis of apprehended bias in that the commissioner had made orders not sought by the employee and had done so on the basis of material not properly before the commissioner (BB 45).

  10. During the hearing the commissioner stated that incapacity was a 'straightforward matter' because '[e]veryone knows the law.  The factual findings are in my decision.  The only issue is how long [the employee] has been capacitated for' (BB 49) (emphasis added).  The employee opposed the employer's applications, stating that there was 'a large volume of documentary evidence before [the commissioner] on the issue of capacity'.  The commissioner agreed, stating:

    [T]here was ample evidence to justify what are basically interlocutory findings on quantum… but there is something in [counsel for the employer's] submission that [the employee] never sought this kind of relief in the first place.  (BB 51)

  11. His Honour dismissed the application for an indefinite adjournment and the application regarding apprehended bias.  Nonetheless, his Honour said that there was merit in remitting the matter to an arbitrator, because this would give a right to appeal from the arbitrator's decision to the District Court, rather than to the Court of Appeal (BB 57). 

  12. On 23 November 2011, the commissioner varied his third and fourth orders so as to read, in effect:

    3.The order of the arbitrator made on 19 April 2011 is quashed and in lieu thereof it is ordered as follows:

    i.The [employer] shall pay weekly payments to [the employee] from 2 March 2010, with liberty to apply to an arbitrator on an urgent basis as to quantum.

    ii.The [employer] shall pay statutory expenses incurred by [the employee] from 2 March 2010 and continuing, with liberty to apply to an arbitrator on an urgent basis as to quantum.

    iii.There is liberty to apply to an arbitrator as to the costs of the proceedings under Part XI.

    4.There is liberty to apply to myself as to the costs of the application for leave to appeal and the appeal.

    (There was no contest in the appeal to this court as to the commissioner's power to refer 'quantum' to an arbitrator).

  13. The effect of the variation was to confirm the earlier determination that the employee's injury resulted in incapacity and to direct that the period of incapacity and quantum generally be determined by an arbitrator rather than the commissioner.  This suggests that the employer's counsel and the commissioner were at cross‑purposes at the hearing on 23 November 2011, as it appears that the employer's complaint was directed not merely to the question of the period of any alleged incapacity, but moreover to the commissioner's determination that the injury had in fact resulted in incapacity. 

  14. On 7 December 2011 an application for a stay of judgment was filed in the Court of Appeal.  It was agreed at a hearing that judgment should be stayed, on terms agreed by the parties. 

  15. Pursuant to the liberty to apply referred to in amended order 3 of the commissioner's orders, the employee's solicitors sought an urgent listing with respect to quantum before an arbitrator.  The matter came before another arbitrator, Arbitrator Melville.  In reasons for decision published on 27 January 2012, Arbitrator Melville referred to the commissioner's orders, as varied on 23 November 2011 and recorded:

    7.The [employee's] application was listed for a directions hearing in the Arbitration Service on 9 December 2011.

    8.At that hearing the [employee's] counsel pressed for a determination of the [employee's] entitlements, more particularly in respect of the periods of incapacity.

    9.It was determined this issue would proceed to be dealt with on the papers having regard to the evidence that was taken into account by the [first arbitrator] and that was before the Commissioner on the hearing of the appeal, a further medical report of Mr McCarthy dated 20 April 2011 and progress medical certificates attached to a letter from [the employee's solicitors] dated 7 December 2011.

    ...

    11.So, in the end, the issue for me to decide on an urgent basis was the nature and extent of the applicant's period of incapacity in light of the abovementioned evidence and the parties' submissions.  (emphasis added)

  16. Arbitrator Melville noted that the employee had submitted that the only medical evidence was to the effect that the employee had been totally unfit for work from 2 March 2010 on a continuing basis.  He rejected that submission and said that the position had changed.  He also noted that the employer did not challenge the submission as to total incapacity from 2 March 2010, but did question a finding of total incapacity beyond 29 September 2010. 

  17. Arbitrator Melville found that the employee was totally unfit for work for the period 2 March 2010 to 5 April 2011 [52] (BB 89).  He was not satisfied, however, that the employee was totally incapacitated beyond 5 April 2011 [58] (BB 90). 

  18. The arbitrator found that the employee could not return to his previous position with the employer and to that extent he had a diminished capacity to sell his labour in the labour market.  However, he found that the employee could have sold his labour elsewhere.  He held that as there was no evidence before him on what the employee could have earned in other fields, he could not calculate the employee's 'entitlements under clause 7(2), if any, to a differential payment between what he is entitled to receive by way of weekly payments for total incapacity and what he is able to earn in those other occupations' [60] ‑ [61] (BB 90 ‑ 91).

  19. Arbitrator Melville ordered that the employer pay the employee weekly payments as for total incapacity from 2 March 2010 to 5 April 2011 [62] (BB 91).

Disposition

  1. In my view the employer was denied procedural fairness in relation to the question of incapacity. Any 'review' properly undertaken under s 247(5) of the Act required the provision of procedural fairness. The hearing before the commissioner had been confined to the issue of injury. The employee had, in the 'orders sought', asked for the arbitrator's decision to be quashed and for his application for weekly payments to be remitted for rehearing to a different arbitrator. Although the arbitrator said that it was agreed that the 'key issue', or the employer's 'primary' argument, concerned s 5(4) of the Act, I would not read those references as indicating that the employer had conceded the issue of incapacity if it lost on the s 5(4) issue. Before the arbitrator, incapacity remained a 'pleaded' issue and was the subject of evidence. The material in this appeal does not otherwise reveal any concession by the employer of the kind alleged by the employee's counsel at the hearing of this appeal. In these circumstances, there was no, or no proper opportunity for the employer to address (either on the evidence as it then stood or in relation to a possible application for leave to adduce evidence under s 247(6) of the Act) the issue of incapacity before the commissioner made orders to the effect that the injury had resulted in incapacity. That constituted a denial of procedural fairness. The variation to the commissioner's orders, made on 23 November 2011, repeated, rather than corrected, the error.

  1. The employer did have the benefit of a hearing in relation to the question of the period of incapacity before Arbitrator Melville.  In its submissions at that hearing, according to Arbitrator Melville's reasons, the employer did not, in effect, challenge incapacity for the period 2 March 2010 to 29 September 2010.  However, the hearing before Arbitrator Melville was conducted in the context of the commissioner's determination that the injury had resulted in incapacity.  Arbitrator Melville was not examining afresh the question of whether the employee's injury had in fact resulted in incapacity.  As I have said, I am not persuaded that the employer had conceded before the arbitrator that if injury were established, then incapacity would also be established. 

  2. For these reasons, I would also allow the procedural fairness point in ground 1.  It is unnecessary to address the reasons point.

Conclusion

  1. For the reasons given above, I would grant leave to appeal and allow the appeal.  Subject to hearing from the parties as to the precise form of final orders, it would seem to me to be appropriate to make orders along the following lines.  The decision of the commissioner and his orders should be set aside, and the original orders of the arbitrator should be restored.  As the orders made by Arbitrator Melville were consequential upon the orders made by the commissioner, those orders should also be set aside.

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Cases Citing This Decision

51

Cases Cited

14

Statutory Material Cited

1

Commonwealth v Butler [1958] HCA 56