Cemex Australia Pty Limited (formally known as Rinker Group Limited) v Freriechs

[2009] NSWWCCPD 101

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		Cemex Australia Pty Limited (formally known as Rinker Group Limited) v Freriechs [2009] NSWWCCPD 101
APPELLANT:		Cemex Australia Pty Limited (formally known as Rinker Group Limited)
RESPONDENT:		Troy Jason Freriechs
INSURER:		Self insured
FILE NUMBER:		A1-009902/07
ARBITRATOR:	Mr D Minus
DATE OF ARBITRATOR’S DECISION:		23 April 2009
DATE OF APPEAL DECISION:		14 August 2009
SUBJECT MATTER OF DECISION:		Supreme Court orders quashing Medical Appeal Panel decision; jurisdictional error in Medical Appeal Panel decision; effect on Arbitrator’s orders made in consequence of an invalid Medical Appeal Panel decision.
PRESIDENTIAL MEMBER:		Keating P
HEARING:		On the papers
REPRESENTATION:		Appellant:		Leigh Virtue & Associates
Respondent:		Attwood Marshall
ORDERS MADE ON APPEAL:		The decision of the Arbitrator dated 23 April 2009 is revoked. The costs of the arbitration hearing dated 12 March 2009 are to follow the orders made after the matter is remitted to the new Medical Appeal Panel. No order as to costs of the appeal.

INTRODUCTION

1. The Employer appeals the Arbitrator’s decision awarding compensation pursuant to section 66 and 67 of the Workers Compensation Act 1987 (‘the 1987 Act’) because the Medical Appeal Panel decision, upon which the Arbitrator relied, was a nullity due to a jurisdictional error.

1. A week after the Arbitrator’s decision was issued, the Supreme Court quashed the Medical Appeal Panel decision, upon which the Arbitrator’s decision was based.

BACKGROUND TO THE APPEAL

1. On 21 May 2009, Cemex Australia Pty Limited (formally known as Rinker Group Limited)  (‘the Appellant/Employer/Rinker’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision, dated 23 April 2009.

1. The Respondent to the appeal is Troy Freriechs (‘the Respondent/Worker’).

1. On 27 December 2007, Mr Freriechs lodged proceedings in the Commission for lump sum compensation under section 66 and 67 of the 1987 Act as a result of injury to his lumbar spine, shovelling under a conveyor belt on 24 July 2006. The application was later amended by consent to include a claim for weekly compensation benefits.

1. On 6 June 2008, a Certificate of Determination issued determining certain procedural issues in respect of the employer’s section 74 Notice and also remitting the matter to the Registrar for referral to an Approved Medical Specialist to assess the degree of permanent impairment.

1. The Registrar referred Mr Freriechs to an Approved Medical Specialist who issued a Medical Assessment Certificate (‘MAC’) on 21 August 2008, assessing a 13% whole person impairment as a result of the injury.

1. On 28 November 2008, after a hearing at Coolangatta on 26 September 2008, a Certificate of Determination issued with an award in favour of Mr Frereichs for weekly compensation at various rates from 29 January 2008 to date and continuing.

1. Rinker appealed the MAC and a Medical Appeal Panel (‘MAP’) issued a decision on 1 December 2008, confirming the MAC.

1. Following the issuing of the MAP decision, the matter was listed for an arbitration hearing in Ballina on 12 March 2009.

1. At the arbitration hearing the parties agreed that the monetary quantification of the claim under section 66 for 13% whole person impairment was $17, 850.00. Given that this assessment exceeded the 10% threshold, Mr Frereichs was entitled to compensation under section 67. Therefore the only matter for determination was the quantification of the compensation for pain and suffering under section 67 and the entering of awards under 66 and 67 for Mr Frereichs.

1. Both parties were represented.  No oral evidence was called but both parties made oral submissions.  The Arbitrator reserved and issued a Certificate of Determination and a statement of reasons on 23 April 2009. It is from this decision that Rinker now seeks leave to appeal.

THE DECISION UNDER REVIEW

1. The ‘Certificate of Determination’, dated 23 April 2009, records the Arbitrator’s orders as follows:

“The determination of the Commission in this matter is as follows:

1. That the Respondent pay to the Applicant, $17,000.00 in respect of 13.0 per cent whole person impairment attributable to the injury on 24 July 2006 as conclusively determined by a Medical Appeal Panel on 1 December 2008, pursuant to s.66 of the 1987 Act. Plus an additional $850.00 representing 5% payable for permanent impairment of the back being an injury occurring after 1 January 2006, so attracting amendments to section 66 (2A) of the Workers Compensation Act 1987 or the total sum of $17,850.00.

2. That the Respondent pay to the Applicant, in respect of the entitlement for compensation for pain and suffering pursuant to s.67 of the 1987 Act, the sum of $16,500.00 in respect of 33% of a most extreme case.

3.    That the Respondent pay the Applicant’s costs as agreed or assessed.

4. I certify that this was a complex matter and determine that pursuant to Clause 4 of Schedule 6 and Item 4 of Table 4 of the Workers Compensation Regulation 2003 that in respect of the Applicant’s costs that a percentage increase of 30% be applied.”

1. At the arbitration it was noted that Rinker had commenced proceedings in the Supreme Court seeking judicial review of the MAP (Cemex Australia Pty Limited v Freriechs and anor (3007/09)).

1. On 30 April 2009 Judgment/Orders were entered in these Supreme Court proceedings as follows:

“1.  Decision of the Medical Appeal Panel (the Second Defendant) dated 1 December 2008, involved error on the face of the record and jurisdictional error.

2.   Order that the decision of the Medical Appeal Panel be quashed.

3.   Order the First Defendant [Troy Freriechs] to pay the Plaintiff’s [Cemex Australia Pty Limited (formally Rinker Group Limited)] Costs of and incidental to these proceedings.

4.   Stand the balance of these proceeding over before the Registrar on Monday 11 May 2009 for Mention.”

1. On 1 July 2009 Consent Orders were also entered in the Supreme Court in the above matter in the following form:

“THE COURT ORDERS-

1. That by consent, pursuant to r 36.17 of the Uniform Civil Procedure Rules 2005, the Court orders that:

1) That matter (ref: M1-009902/07) be remitted to the Registrar of the Workers Compensation Commission for referral to a differently constituted Medical Appeal Panel for determination according to law.”

ISSUES IN DISPUTE

1. The Appellant submits that the Arbitrator erred in determining the matter because:

(a)     the decision of the MAP is a nullity and has now been revoked by the Supreme Court, and

(b)     the arbitration had not been completed and the Appellant had not submitted on all issues.

ON THE PAPERS REVIEW

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

“(6)   If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”

1. Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submission by the parties, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances. 

LEAVE

1. Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act.

1. The appeal was lodged on 27 May 2009, within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.

1. The monetary thresholds on section 352 (2)(a) and (b) are met.

1. Leave to appeal is granted.

FRESH EVIDENCE

1. Neither party seeks to rely on fresh and/or additional evidence on appeal.

EVIDENCE AND SUBMISSIONS

Appellant’s submissions

1. The Appellant relies on the Supreme Court Judgment and Order dated 30 April 2009 quashing the MAP decision.

1. The Appellant submits that the Arbitrator determined the matter on the basis of a decision of the MAP which contained a jurisdictional error and is a nullity

1. Instead of issuing a draft decision, as he said he would, the Arbitrator issued the final decision.

1. The Appellant was not given an opportunity to make submissions on the jurisdictional issues arising from the Supreme Court challenge to the MAP decision.

1. The Appellant seeks the following relief:

(a)     the Arbitrator’s decision be revoked and the matter remitted for re-determination by another arbitrator.

(b)     the costs of the arbitral proceeding should be dealt with following the re-determination.

1. The Appellant submitted that it would make further submissions in relation to costs of the appeal proceedings would be made after receipt of the Notice of Opposition. No further submissions were made.

Respondent’s submissions

1. In letters dated 15 June 2009 and 7 July 2009, Mr Frereichs’ solicitor confirmed that Mr Frereichs would not be filing a Notice of Opposition to the appeal and consented to the relief sought by the Appellant save that:

“should the appellant’s appeal to the medical panel be quashed, as was the case on the first occasion, the Commission should then reinstate the original determination made by Arbitrator Minus in the applicant’s favour.”

1. In a letter dated 23 July 2009 the solicitor for Mr Frereichs confirmed that they were awaiting a determination of a differently constituted Medical Appeal Panel, which “may or may not alter the outcome of the arbitral determination”.

1. Further, it is submitted that the arbitral appeal filed by Rinker should be deferred until the decision of the differently constituted Medical Appeal Panel and only if there is an alteration in the “original Appeal Panel findings” should the arbitral appeal proceed.

DISCUSSION AND FINDINGS

1. The transcript discloses that both parties made lengthy oral submissions. At the conclusion of those submissions, the Arbitrator stated at T23:9-15:

“Thank you for that. Thank you, gentlemen. I’m going to reserve my decision in this matter. I think you would want me to do that. But I will undertake to provide it quickly. If I can say ‑ I was going to say a week, but I’ll make it a week and the Monday. Monday, the 16th ‑ Monday, the 23rd. I’ll have it produced by the 23rd. Is that a date that's going to be –”

1. Mr Macken, solicitor for Rinker, responded at T23:16-21:

“That’s fine. I’ve got no problem with that, and I’ll then get in touch with my friend and see if we can come to some accommodation going forward about these other issues or whether we need to address further on them.”

1. The transcript does not disclose that the Arbitrator intended to only publish a draft decision to assist the parties in resolution of the matter, as submitted by the Appellant.  Whilst Mr Macken’s submission suggests there were outstanding issues, they were not identified in the transcript of the arbitral proceedings. On appeal the Appellant claims that it sought to make further submissions on the jurisdictional error in the MAP and the Supreme Court review proceedings.

1. It is not necessary to determine this ground of appeal, essentially alleging a denial of procedural fairness, because of the intervening Order issued by the Supreme Court.

1. A determination made in reliance on an invalid MAC, is also invalid (see Jopa Pty Limited t/as Tricia’s Clip-n-Snip v Edenden [2004] NSWWCCPD 50; (2004) 5 DDCR 321 at [37].

1. The Arbitrator’s decision was based on the assumption that a valid and binding MAP decision was issued. In light of the Supreme Court Judgment and Order that assumption is no longer valid. The Supreme Court quashed the MAP decision on the basis that it contained a jurisdictional error. It follows that all decisions and orders of the Commission based on that MAP and consequential to it, cannot stand and must be revoked.

1. I do not accept Mr Frereichs’ submission that the Arbitrator’s decision could be preserved if the decision of the new Medical Appeal Panel confirms the original MAC. That submission assumes that the new MAP will give the same reasons as the previous MAC and there is no basis for that assumption. While at a practical level if the new MAP’s reasons and conclusions are similar to the original MAC, it would make sense for the parties to reach agreement and resolve the claim. In the absence of agreement there is no alternative than for any outstanding issues to be re-determined.

CONCLUSION

1. Having conducted a review on the merits (per Spigelman CJ in State Transit Authority of New South Wales v Fritzi Chemmler [2007] NSWCA 249; (2007) 5 DDCR 2878 at [28]), the jurisdictional flaw in the MAP affects the entirety of the Arbitrator’s decision dated 23 April 2009 and necessitates the revocation of that decision.

DECISION

1. The Certificate of Determination dated 23 April 2009 is revoked.

1. The costs of the arbitration hearing on 12 March 2009 are to follow the orders made when the matter is determined after remitter to the new Medical Appeal Panel.

COSTS

1. Each party to pay their own costs of the appeal.

His Hon. Judge Keating

President

14 August 2009

I, MELANIE CURTIN, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF HIS HON. JUDGE KEATING, PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE