Chand v Spicer Axle Australia Pty Ltd

[2006] NSWWCCPD 34

WORKERS COMPENSATION COMMISSION

APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR

CITATION:Chand v Spicer Axle Australia Pty Ltd  [2006] NSWWCCPD 34

APPELLANT:  Kamata Prasad Chand

RESPONDENT:  Spicer Axle Australia Pty Ltd

INSURER:CGU Workers Compensation (NSW) Ltd

FILE NUMBER:  WCC 12662-05

DATE OF ARBITRATOR’S DECISION:          25 November 2005

DATE OF APPEAL DECISION:  2 March 2006

SUBJECT MATTER OF DECISION:                Leave to amend ‘Reply’, allegation of bias by the Arbitrator

PRESIDENTIAL MEMBER:  Acting Deputy President Robin Handley

HEARING:On the papers

REPRESENTATION:  Appellant: PK Simpson & Co, Solicitors

Respondent: McCulloch & Buggy, Solicitors

ORDERS MADE ON APPEAL:  The decision of the Arbitrator dated 25 November 2005 is confirmed.

There is no order as to the costs of this appeal.

BACKGROUND TO THE APPEAL

1. On 6 January 2006, Kamata Prasad Chand sought leave in the Workers Compensation Commission (‘the Commission’) to bring an appeal against the decision of an arbitrator dated 25 November 2005. The Respondent to the appeal is Spicer Axle Australia Pty Ltd (‘Spicer’). The decision took the form of a Direction, ultimately issued to the parties on 13 December 2005.

1. Mr Chand was born on 3 December 1948 and is aged 57. He claims that his wife is financially dependant on him. On or about 1 June 1990, Mr Chand was employed by Spicer as a First Class Machine Operator. He claims that (1) on 1 June 1996, as a result of lifting a heavy axle in the course of his employment, (2) on 21 March 2001, as a result of lifting axles in the course of his employment, and (3) between 1 June 1996 and 11 January 2002, as a result of the nature and conditions of his employment, he suffered injury to his head, neck, right arm, left arm, right leg, left leg, chest, back, bowel function, and sexual organs, together with anxiety and/or depression. Spicer terminated Mr Chand’s employment on 19 January 2002.

1. Mr Chand commenced proceedings claiming workers compensation in the Compensation Court of NSW by way of ‘Application for Determination’ filed on 8 February 2002, particularising injuries to his neck, both shoulders and arms sustained as a result of the nature and conditions of his employment “In and from 1996 to the present time”. On 17 February 2003, he received an award of: (1) weekly compensation, based on partial incapacity; (2) lump sum compensation for permanent impairment (16% permanent impairment of the neck, 8% loss of use of the left arm at or above the elbow, and 12% loss of use of the dominant right arm at or above the elbow) and pain and suffering; (3) medical, hospital and related expenses; (4) costs as agreed or assessed.

1. Mr Chand had surgery to his right shoulder in May 2003 and to his left shoulder in August 2004 that he claims has worsened his condition.

1. By letters dated 10 November 2004, Mr Chand’s solicitors made a claim on both Spicer and its workers compensation insurer for (1) compensation for permanent impairment (18% permanent impairment of the back, 2% permanent impairment of the neck, 11% loss of use of the left arm at or above the elbow, 14% loss of use of the right arm at or above the elbow, 39% loss of efficient use of the sexual organs, and 1% loss of use of bowel function) and pain and suffering, and (2) medical, hospital or related expenses. The letters particularised the date of injury as “21 March 2001 and 1 June 1990 to 19 January 2002”. By letters dated 23 February 2005, Mr Chand’s solicitors made a second claim for lump sum compensation for permanent impairment comprising 7% permanent impairment of the neck, 5% loss of efficient use of the left leg at or above the knee and 5% loss of efficient use of the right leg at or above the knee, in respect of the same date of injury. By letters dated 20 July 2005, Mr Chand’s solicitors made a third claim for lump sum compensation for 45% whole person impairment, again specifying the same date of injury.

1. On 28 July 2005, Mr Chand’s ‘Application to Resolve a Dispute’ in respect of the injuries particularised in paragraph 2 above was registered by the Commission. He claimed (1) compensation for permanent impairment and pain and suffering, and (2) medical, hospital or related expenses. Spicer’s ‘Reply’ was lodged with the Commission on 18 August 2005. On 6 October 2005, the Arbitrator conducted a first teleconference with the parties, during the course of which Spicer sought to raise an issue not previously raised, that of issue estoppel. Mr Chand’s solicitors objected, claiming this was highly prejuducial. The Arbitrator issued directions requiring Spicer to file and serve any amendments to its ‘Reply’ by 13 October 2005, and giving leave to Mr Chand’s solicitors to file and serve objections to the admissibility of Spicer’s amended ‘Reply’ on or before 20 October 2005. The Arbitrator said that, on or before 27 October 2005, she would decide ‘on the papers’ whether to admit the amended ‘Reply’.

1. Late afternoon on 27 October 2005, the Arbitrator contacted a Dispute Management Officer at the Commission by email, noting that she had not received any submissions from the parties pursuant to the directions issued at the teleconference on 6 October 2005, and asking for confirmation that no submissions had been received. Next morning, on 28 October 2005, the Dispute Management Officer phoned Spicer’s solicitors noting that no submissions had been received in response to the directions issued on 6 October 2005. Shortly after, Spicer’s solicitors faxed both to the Commission and Mr Chand’s solicitors a one page document headed “Amended Issues in Dispute”. Mr Chand’s solicitors’ submissions in response were faxed to the Commission on 1 November 2005.

1. On 8 November 2005, the Arbitrator issued further directions noting receipt of Spicer’s “Amended Issues in Dispute”, directing that a copy of this document be served on or before 11 November 2005, and that Mr Chand’s solicitors file and serve any objections to the admissibility of the amended Reply on or before 18 November 2005. (The Arbitrator was apparently unaware of Mr Chand’s solicitors’ submissions on the admission of the amended Reply that were faxed to the Commission on 1 November 2005.) On 23 November 2005, the Arbitrator conducted a second teleconference with the parties, when she became aware that she did not have a copy of Mr Chand’s solicitors’ submissions received by the Commission on 1 November 2005. She therefore deferred a decision on the issue of the admissibility of Spicer’s amended Reply until she had received Mr Chand’s solicitors’ response. Mr Chand’s counsel faxed the Arbitrator a copy of the submissions in response later in the day on 23 November 2005.

1. On 25 November 2005, the Arbitrator made a Direction, set out below, granting leave to Spicer to amend its ‘Reply’ to include the “Amended Issues in Dispute”. However, due to an apparent administrative oversight by Commission officers, the Direction was not sent to the parties and they did not see this until the conciliation/arbitration hearing on 13 December 2005. Mr Chand’s solicitors therefore requested and the Arbitrator granted an adjournment until 11 January 2006. Following receipt of Mr Chand’s appeal application, the conciliation/arbitration hearing was postponed pending the outcome of a decision on the appeal.

THE DECISION UNDER REVIEW

1. The Direction given by the Arbitrator, dated 25 November 2005, states:

“1. The Reply is amended to include the “Amended Issues in Dispute” filed by the Respondent on 28 October 2005.
2. Leave is given to the Applicant to amend the Application to reflect a claim for increased impairment as a result of the judgment in the Compensation Court in 2003. Particulars of the amendment must be filed and served by the Applicant on or before 2 December 2005.
3. The matter is set down for conciliation/arbitration at the Commission on 13 December 2005 at 2pm.”

1. In the statement of reasons for her decision, the Arbitrator noted that Rule 17(1) of the Workers Compensation Rules 2003 (‘the 2003 Rules’) permits the Commission to give leave to a party to any proceedings before the Commission to amend any document filed by the party “if the Commission considers the amendment to be necessary for the avoidance of injustice”. The Arbitrator stated:

“I consider it to be in the interests of justice to allow all issues in dispute to be heard in these proceedings provided those issues have been raised within a reasonable time and provided further that any prejudice to a party as a result of the late raising of any issues is outweighed by the interests of justice.”

1. The Arbitrator noted that:

“the additional issue [of estoppel] will only result in additional time at the conciliation/arbitration, rather than any substantial delay in any referral to an Approved Medical Specialist. Under these circumstances the interests of justice demand that the substantial issues between the parties should be given a hearing.”

She also noted errors in Mr Chand’s ‘Application to Resolve a Dispute’ that required amendment, including in the claim for permanent impairment of certain body parts which should have been for increased impairment of those parts rather than for impairment as a whole.

ISSUES IN DISPUTE

1. The grounds of appeal raised by Mr Chand’s solicitors are whether the Arbitrator erred by: (1) allowing Spicer to amend its ‘Reply’ to include the issue of estoppel, (2) reminding Spicer to raise an issue that it might not otherwise have raised, (3) raising an issue as to the admissibility of a medical report not otherwise raised by either party, and (4) failing to disqualify herself at the conciliation/arbitration conference on 13 December 2005. The parties’ submissions on these grounds are considered below.

ON THE PAPERS REVIEW

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

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

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

1. Neither party sought to adduce fresh evidence.

LEAVE

1. Before proceeding to deal with an appeal, the Commission must determine whether the application meets the requirements of section 352 of the 1998 Act. The appeal was lodged within 28 days of the issue of the Arbitrator’s decision (Rule 77(2) of the 2003 Rules) in compliance with section 352(4) of the 1998 Act. With regard to section 352(2), Mr Chand’s solicitors state the amount of compensation at issue exceeds $5,000 and constitutes more than 20% of the amount claimed.

1. I am satisfied that whilst the decision of the Arbitrator did not concern an ‘award’, the decision does “have a real capacity to put the amount of compensation, determined by reference to the decision or the claim (Sheridan v Coles Supermarkets Australia Pty Limited [2003] NSW WCC PD 3), in issue in the appeal (as in the case of the filing of a ‘Reply’ (ADCO Constructions Pty Ltd v Ferguson [2003] NSW WCC PD 21))”. (Fletchers International Exports Pty Ltd v Regan [2004] NSW WCC PD 7 at page 5). I am therefore satisfied that the section 352 threshold has been met, and I grant leave to appeal.

SUBMISSIONS, DISCUSSION AND FINDINGS

1. As noted above, Mr Chand’s solicitors identified four grounds of appeal. I will deal with these in turn.

Grounds 1 and 2: the Amendment of Spicer’s ‘Reply’

1. Mr Chand’s solicitors submit the Arbitrator erred in allowing Spicer to amend its Reply without it having provided an acceptable explanation for the delay in seeking to do so, and without explanation for failing to comply with the Arbitrator’s directions. Moreover, Spicer has not complied with Rule 40(2)(a) of the 2003 Rules in so far as it has not explained the specific nature of the issue, its reliance on it, and the reasons why it was not raised in its original Reply. This has resulted in a denial of procedural fairness for Mr Chand and prejudice to him in terms of a substantial delay in the determination of the dispute.

1. Mr Chand’s solicitors also state they rely on the decisions in Australian Pharmaceutical Industries Pty Ltd v Scarfone [2004] NSW WCC PD 12 (‘Scarfone’) and Coles Myer Ltd v Tabassum [2005] NSW WCC PD 16 (‘Tabassum’), but without explaining why; they submit that allowing the amended Reply is against the objectives of the legislative scheme; that the Arbitrator meddled in the proceedings by urging the Dispute Management Officer to inquire of Spicer regarding its proposed amended Reply, giving rise to a reasonable apprehension of bias; and that the correct approach would have been to conduct the teleconference on 23 November 2005 without regard to the proposed amendment to the Reply.

1. In its submissions, Spicer states that its document “Amended Issues in Dispute”, and letters to both Mr Chand’s solicitors and the Commission, were generated on 10 October 2005. When, on 28 October 2005, a phone call was received from a Dispute Management Officer at the Commission noting that the Commission did not have a copy of Spicer’s amended Reply, a review of the file was conducted “and it became clear that the document and letters serving same had not been dispatched”. Copies were immediately forwarded to the Commission and Mr Chand’s solicitors.

1. Spicer submits the Arbitrator properly exercised her discretion pursuant to Rule 17(1) of the 2003 Rules to permit Spicer to amend its Reply. Mr Chand’s solicitors have been unable to show any real prejudice as a result of the amendment. The only delay has been caused by Mr Chand’s solicitors continually seeking to frustrate and delay the ultimate determination of the proceedings. No further evidence has been required to meet an issue estoppel defence. It is a legal issue for determination by the Arbitrator having heard submissions from the parties. The fact of prior Compensation Court proceedings and findings by a judge of that Court obviously activates the principles of estoppel. The parties are bound by those earlier findings and Mr Chand’s solicitors’ submission that they were taken by surprise by an estoppel defence is unconvincing.

1. As noted by the Arbitrator, the Commission has power to permit the amendment of any document, pursuant to Rule 17(1), if “necessary for the avoidance of injustice”. I agree with Spicer’s submission that the fact of prior Compensation Court proceedings in this matter raises the possibility that estoppel might become an issue in subsequent proceedings in the Commission. To the extent that findings in the Compensation Court are relevant to issues in the Commission proceedings, the Commission will be bound by those findings.

1. Mr Chand’s solicitors submit that Spicer did not comply with Rule 40(2)(a). While the issues that a respondent intends to raise in response to an ‘Application to Resolve a Dispute’ registered by the Commission, should be raised in its ‘Reply’ in accordance with Rule 40(1) (and see section 290(1) of the 1998 Act), Rule 40(2)(a) is clearly intended to apply in respect of “evidence that has not been lodged” rather than issues raised. It was evidence that was the subject of Deputy President Byron’s comments in Tabassum with regard to Rule 40(2)(a). Nevertheless, as is emphasised in the Commission’s Practice Direction No 9 (discussed by Deputy President Byron in Scarfone), the parties are expected to comply with the timeframe requirements of the Commission, and a party wishing to lodge late information must seek leave of the Commission.

1. In my view, the fact of Mr Chand’s claim before the Commission being in respect of many of the same conditions that were the subject of his proceedings before the Compensation Court, inevitably raises the question of whether estoppel might be raised by Spicer. Thus, when Spicer raised this as an issue at the first teleconference with the Arbitrator on 6 October 2005, Mr Chand’s solicitors should not have been taken by surprise. I accept that Spicer’s failure to comply with the Arbitrator’s direction was due to an administrative oversight and that, as a result, the proceedings were delayed by nearly three weeks. However, this was not an issue involving new evidence and, apart from this delay, I am not satisfied there was any prejudice to Mr Chand or any denial of procedural fairness. In my view, Rule 40(2)(a) does not assist Mr Chand’s solicitors’ submissions for the reasons stated above. However, I agree it is important for the timely resolution of claims and consistent with the Commission’s objectives (see section 367 of the 1998 Act) that parties comply both with the 2003 Rules in relation to the exchange of information and documents, and also with the Commission’s directions.

1. I reject Mr Chand’s solicitors’ contention that the Arbitrator “meddled in the proceedings”. It is clear from the file that she did not. The initiative taken in phoning Spicer’s solicitors to chase up the late amended Reply, was entirely that of the Dispute Management Officer, and, in my view, was consistent with her role and that of the Commission in promoting the timely resolution of disputes. Spicer had already made clear at the teleconference that it intended to raise the issue of estoppel as part of its defence to Mr Chand’s claim. For the Arbitrator to have conducted the teleconference on 25 November 2005 without regard to the amended Reply, as suggested by Mr Chand’s solicitors, could have lead to injustice in relation to Spicer and would likely have further delayed the resolution of these proceedings. Thus, I am not satisfied that the Arbitrator made any error in allowing Spicer to amend its Reply pursuant to Rule 17(1).

Ground 3: the Arbitrator’s Raising a Question as to the Admissibility of a Medical Report

1. Mr Chand’s solicitors submit that the Arbitrator “advised the Applicant’s representatives that a particular medical report was not admissible”, an issue that had not previously been raised by either party or by the Arbitrator. Spicer raised no objection to this report. Mr Chand’s solicitors contend that this issue being raised so late in the proceedings has prejudiced their client.

1. Spicer submits this ground of appeal has no merit given that the Arbitrator has made no decision on this issue. It notes that the issue was raised by the Arbitrator in light of the decision of Deputy President Fleming in Fishburn v Integral Energy Australia [2005] NSW WCC PD 53 (‘Fishburn’), as a matter for the parties to consider during the adjournment of the conciliation/arbitration in anticipation that Mr Chand might later be required to attend an Approved Medical Specialist for assessment of permanent impairment. Spicer submits the Arbitrator was entitled to raise this issue in the conciliation phase of the proceedings, particularly given that the proceedings were to be adjourned. Moreover, by raising the issue, the Arbitrator afforded Mr Chand greater procedural fairness by enabling his solicitors to obtain further instructions and, possibly, further evidence.

1. There is no indication in the determination appealed against, or in the file, of the Arbitrator making any decision in relation to the admissibility of a medical report. Thus, there being no evidence of any decision on this issue, this is not a matter that can be the subject of an appeal under section 352(1) of the 1998 Act. If I am correct in assuming that the Arbitrator’s raising the issue of the admissibility of a medical report in the context of the decision in Fishburn, may have been in view of the possible application of clauses 43 and 43A of the Workers Compensation Regulation 2003 (concerning the restrictions on the admissibility of medical reports in Commission proceedings and on the disclosure of medical reports to Approved Medical Specialists), then this was an issue the Arbitrator was entitled to raise of her own volition as a matter of compliance with the applicable procedural provisions relevant to Commission proceedings. By doing so, the Arbitrator afforded Mr Chand procedural fairness. Thus, I am not satisfied there is any basis for Mr Chand’s solicitors’ third ground of appeal.

Ground 4: the Arbitrator’s Decision not to Disqualify Herself

1. Mr Chand’s solicitors state that when they made an application to the Arbitrator requesting that she disqualify herself “on the ground that she had adopted an advocacy role and did not appear to be impartial in her dealing with the parties”, she erred by refusing to do so. Mr Chand’s solicitors seek to rely on the Arbitrator’s intended exclusion of a medical report, her getting the Dispute Management Officer to obtain an amended Reply from Spicer, and her concluding that Spicer’s non-compliance with the directions issued on 8 November 2005 was “due to an apparent oversight” when this had never been suggested by Spicer. Mr Chand’s solicitors submit the Arbitrator demonstrated partiality, and a fair-minded lay observer might reasonably apprehend that she might not bring an impartial and unprejudiced mind to the resolution of the issues in dispute.

1. Spicer submits there is no evidence of the Arbitrator being anything other than impartial. The fact that the Arbitrator made a decision not preferred by Mr Chand’s solicitors does not evidence bias and is not a ground for disqualification.

1. In my view, there is no evidence of bias. As I have said above, I reject the submission that the Arbitrator adopted an advocacy role by contacting the Commission’s Dispute Management Officer to inquire whether an amended Reply had been received from Spicer. I also take the view that her handling of the discussion of medical evidence was entirely proper. With regard to non-compliance with the directions issued on 8 November 2005, I note Spicer lodged a copy of its amended Reply with the Commission by fax on 28 October 2005 and, at the same time, also faxed a copy to Mr Chand’s solicitors, as was acknowledged by them in their submissions on the admission of this amended Reply dated 1 November 2005. In her Direction dated 25 November 2005, the Arbitrator referred to Spicer’s not having served a copy of its amended Reply on Mr Chand’s solicitors as “an apparent oversight”. I reject the submission that such a comment indicates bias. The Arbitrator would, presumably, have by then learned that Spicer had faxed a copy of the amended Reply to Mr Chand’s solicitors on 28 October 2005, as acknowledged in Mr Chand’s solicitors’ submissions on the admission of the amended Reply, and may have assumed that failure to formally serve the amended Reply was probably an oversight. In my view, there is no indication of bias in such an assumption. Thus, I am not satisfied that there is any evidence that would lead a fair-minded observer to reasonably apprehend bias on the part of the Arbitrator.

1. In conclusion, Mr Chand’s solicitors have failed to make out any of their grounds of appeal, and the decision of the Arbitrator must therefore be confirmed. The matter must now be set down for a further conciliation/arbitration hearing before the Arbitrator.

DECISION

1. The decision of the Arbitrator dated 25 November 2005 is confirmed.

COSTS

1. There is no order as to the costs of this appeal.

Robin Handley

Acting Deputy President  

2 March 2006

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

ASSOCIATE