Council of the City of Sydney v Estate of Belinda Jane Griffey and Anor (No. 1) - [2008] NSWWCCPD 114

WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:		Council of the City of Sydney v Estate of Belinda Jane Griffey and Anor (No. 1) [2008] NSWWCCPD 114
APPELLANT:		Council of the City of Sydney
FIRST RESPONDENT:		Christine Griffey and Kevin John Griffey as Executors of the Estate of the late Belinda Jane Griffey
SECOND RESPONDENT	Sydney West Area Health Service
INSURER:		Self insured
FILE NUMBER:		WCC15593-06
DATE OF ARBITRATOR’S DECISION:		24 December 2007
DATE OF APPEAL DECISION:		15 October 2008
SUBJECT MATTER OF DECISION:		Nature of review on appeal under section 352 of the Workplace Injury Management and Workers Compensation Act 1998; statutory jurisdiction of the Commission; continuation of proceedings in the Commission in the case of death of worker; Rule 18.4 Workers Compensation Commission Rules 2006; causation; novus actus interveniens; expenses pursuant to section 60 of the Workers Compensation Act 1987; recovery by Hospital from employer pursuant to sections 61(8) and 62(7) of the Workers Compensation Act 1987; whether equitable set-off available; correct and preferable decision; error of fact; error of law.
PRESIDENTIAL MEMBER: HEARING:		Deputy President Gary Byron Determined on the papers
REPRESENTATION:		Appellant:	Home Wilkinson Lowry Lawyers
First Respondent:	Burston Cole & Mulock Pty Limited
Second Respondent:	GIO General Insurance Law Department
ORDERS MADE ON APPEAL:		The decision of the Arbitrator, dated 24 December 2007 is revoked and the following decision is made in its place: ‘The Appellant is to pay to the First Respondent, Ms Griffey’s reasonably necessary expenses pursuant to section 60 of the Workers Compensation Act 1987, in relation to the work-related injury sustained in the motor vehicle accident only, upon production of accounts and/or receipts.’
The Second Respondent is to pay the Appellant’s costs of this appeal. No further order is made as to costs.

BACKGROUND

On the morning of 29 April 2004 Belinda Jane Griffey was involved in a motor vehicle accident on her way to work at the Council of the City of Sydney. The vehicle that she was driving was struck heavily on the driver’s side by a truck, causing her to be injured and trapped inside.

Ms Griffey was released from her car and transported from the scene of the accident to Nepean Hospital where it was determined that she had sustained a blunt injury to her head, face, neck, abdomen/pelvis and right lower leg. Ms Griffey was assessed as having sustained principally, orthopaedic injuries and was treated accordingly. She started experiencing headaches, vomiting and disorientation between 4 and 6 May 2004, and on 7 May 2004 tests revealed that her sodium levels had became critically low. Two days later, on 9 May 2004 she was diagnosed with hyponatraemia. She was given treatment, however the correction was too rapid resulting in a marked deterioration of her condition leading to gross neurological dysfunction on 11 May 2004. Tragically, by 16 May 2004 she had sustained irreversible brain damage and spastic quadriplegia. Ms Griffey was then, and remained, totally incapacitated for work, being in, what is described as a “persistent vegetative state” (see [4] of Arbitrator’s ‘Statement of Reasons for Decision’ dated 24 December 2007).

On 16 August 2005 Ms Griffey commenced proceedings in the Supreme Court of NSW (matter no. 20304/05) claiming damages, interest and costs against the Hospital for breach of its duty of care in both failing to make a diagnosis of hyponatraemia until 9 May 2004 and then failing to treat her condition appropriately.

In Mosby’s Medical, Nursing and Allied Health Dictionary, 6^th ed. (St Louis: Mosby Inc, 2002) at page 856, “hyponatraemia” is described as:

“… a lower than normal concentration of sodium in the blood, caused by inadequate excretion of water or by excessive water in the circulating bloodstream. In a severe case the patient may experience water intoxication, with confusion and lethargy, leading to muscle excitability, convulsions, and coma. Fluid and electrolyte balance may be restored by IV infusion of a balanced solution or a fluid-restricted diet.”

The Council initially accepted liability for the motor vehicle incident and made weekly payments of workers compensation until 15 September 2006, at which time liability was declined on the basis that brain damage and spastic quadriplegia sustained by Ms Griffey did not result from the motor vehicle accident, but rather, resulted from the South West Area Health Service’s (‘the Hospital) negligence. In its initial submissions on appeal, Council states at [10]:

“The City, which is self-insured, accepted liability under the Act for the injury – ie for the car accident – by letter of 14 May 2004. That acceptance occurred prior to the realisation of the damage inflicted by the Hospital. In any event, the question is what flows from the City’s liability under the Act in relation to the injury.”

On 3 October 2006 Ms Griffey lodged an Application to Resolve a Dispute (WCC15593-06) in the Workers Compensation Commission (‘the Commission’). Ms Griffey sought weekly benefits compensation, payment of medical and treatment expenses, and lump sum compensation pursuant to sections 66 and 67 of the Workers Compensation Act 1987 (‘the 1987 Act’) from the Council. Ms Griffey claims that the brain damage she has sustained is causally connected to the motor vehicle accident on 29 April 2004.

On 27 December 2006 the Hospital lodged an ‘Application to Resolve a Dispute’ (WCC18397-06) in the Commission to recover hospital, medical and treatment expenses pursuant to sections 61(8) and 62(7) of the 1987 Act, in the amount of $731,897.05, from the Council in relation to the treatment provided to Ms Griffey from 29 April 2004 to date. The Hospital submitted that Ms Griffey’s condition was directly attributable to the hyponatraemia and that the medical treatment, including the treatment for hyponatraemia is associated with risk. It asserts that while the risks associated with aggressive treatment and correction of the hyponatraemia are potentially devastating, the risks involved in not doing so aggressively, are equally potentially devastating.

A teleconference was scheduled on 19 January 2007 for both matters (WCC15593-06 & WCC18397-06) by which time a delegate of the Registrar had made an order on 3 January 2007, for both matters “to be heard concurrently”. An arbitral hearing was listed on 9, 10 and 11 May 2007. The Arbitrator duly issued a ‘Certificate of Determination’ and ‘Statement of Reasons for Decision’ (‘Reasons’) of 24 December 2007, noting at [8] of her Reasons:

“This decision concerns the preliminary questions of whether Ms Griffey’s current condition is compensable and would entitle her to have the cost of hospital and medical treatment paid by the Council pursuant to section 60 of the 1987 Act and also entitle the Hospital to recover from the Council the costs of hospital and medical treatment provided to Ms Griffey since 29 April 2004. The determination of whether or not such treatment received was reasonably necessary and the claim for lump sum compensation claim pursuant to section 67 for pain and suffering has been deferred pending the determination of the preliminary issue.”

The Council commenced proceedings in the Supreme Court (matter no.20041/07) on 20 February 2007 against the Hospital, “claiming, amongst other things, in the tort of per quod servitium amisit”.

On 18 January 2008 the Council sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Commission against the Arbitrator’s decision dated 24 December 2007, with respect to the issue of causation generally, and other associated matters. A teleconference was held on 30 January 2008 where it was agreed by the parties that the Arbitrator should proceed to decide the section 66 and section 67 issues on the papers, even though the appeal lodged by the Council dated 18 January 2008 was still pending.

On 4 March 2008 the Hospital lodged a ‘Notice of Opposition to Appeal Against Decision of Arbitrator’ (‘Opposition’) in the Commission. Ms Griffey lodged an Opposition on 18 April 2008.

The Arbitrator delivered a further determination on 12 March 2008, and on 9 April 2008 the Council sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Commission against this decision. Ms Griffey also lodged an Opposition to this second appeal on 4 June 2008. The Hospital, under cover of a letter dated 6 June 2008, states, “As the Appeal relates to sections 66 and 67 of the Workers Compensation Act, Sydney West Area Health Service does not intend to lodge with the Commission or serve on the other parties a Notice of Opposition, the issue of causation being adequately ventilated in submissions on the main appeal.”

Both appeals are before me.

NOTIFICATION OF MS GRIFFEY’S DEATH

Ms Griffey’s legal representatives informed the Commission by letter dated 9 July 2008, that she passed away on 1 May 2008, and that the Council and the Hospital had been informed, accordingly. The Registrar of the Commission acknowledged the letter on 11 July 2008, advising that the appeals had been allocated to a Presidential member on the previous day, 10 July 2008, for consideration and determination. The Registrar sent a copy of her letter in reply to each of the other parties. On 15 July 2008, I issued the following Directions to each of the parties:

“1.Having regard to the advice set out above, the parties may, should they wish to do so, make written submissions as to Ms Griffey’s death on 1 May 2008, as may be relevant to these proceedings.

2.Each of the parties should file in the Commission, and serve on each of the other parties, any such written submissions on or before 4.30 pm on Wednesday 30 July 2008.

3.Each of the parties should file in the Commission, and serve on each of the other parties, any written response to any such submissions made on or before 4.30 pm on Wednesday 13 August 2008.

4.Each of the parties should file in the Commission, a ‘Certificate of Service’ in relation to the service on the other parties, of any submissions and any written response, served on each or any of the other parties, on or before 4.30 pm on Wednesday 13 August 2008.”

The Council filed no submissions in response to the Directions issued, or in response to submissions filed by the other parties, by the date specified in the Directions. On Thursday 28 August 2008 the Solicitors for the Council apologised and informed the Commission by telephone that they were not in a position to respond until they succeeded in consulting Counsel. On Monday 1 September 2008 the Solicitors indicated that further submissions would be made and sought leave to file and serve on the other parties, such further written submissions on or before close of business on Friday 5 September 2008. Leave was granted having regard to the particular circumstances of the matter, including the fact that grant of probate was still pending. It remained open to the other parties to respond to any such submissions made, and both Ms Griffey’s Solicitors and the Hospital filed further written submissions, as set out later in these Reasons.

Meanwhile, Ms Griffey’s Solicitors filed submissions in the Commission on 24 July 2008, pursuant to the Directions issued, in the following terms:

“Preliminary
1.These Submissions are filed pursuant to a direction made by a Deputy President of the Commission following the death of Ms Griffey on 1 May 2008.

Procedural Consequences

2.Ms Griffey died having left a will, which appointed her parents as executors. The parents are seeking probate of that will and have retained the same solicitor who acted for Ms Griffey in the applications heard by the Arbitrator. It is anticipated that the necessary documents will be filed this week and in the ordinary course (the estate lacking complexity) a grant of probate would issue about 2 weeks later.

3.The Workers Compensation Commission Rules 2006 are silent as to the procedure to be adopted where a deceased person’s estate is involved. Rule 1.5 enables the Commission to give directions as to the procedure to be adopted. In due course the parents will apply for a direction appointing them to represent the estate of the late Ms Griffey. In the interim (until there is a grant of probate) and so that these proceedings can progress, someone has to be appointed to represent the estate. The parents, as the executors named in the will, are the obvious candidates. Evidence of their consent will be filed with these Submissions. (The obtaining of their consents may cause some slight delay.) The Commission is asked by them that they be appointed to represent the estate until further order. This type of procedure is envisaged by Part 7 Rule 10 of the Uniform Civil Procedure Rules 2005, which the Commission could follow by analogy. A copy of that Rule is attached.

Does Ms Griffey’s Death Affect the Appeal

4.It is submitted that it does not. The applications brought by Ms Griffey were all determined by decisions of the Commission constituted by an arbitrator before her death. In these circumstances section 67(5) of the Workers Compensation Act 1987 is not engaged so as to defeat the claim for compensation for pain and suffering: See Bresmac Pty Ltd v Starr (1992) 8 NSWCCR 601 at 617 A- per Priestley JA with whom Handley and Sheller JJA agreed.

5.Section 66 does not include a death related limitation as section 67 does. This gives rise to the negative inference that the fact of subsequent death was intended by the Legislature to be irrelevant. This is consistent with the general principle that an entitlement to workers compensation accrues at the time of injury. Moreover, the subject matter of an award of compensation under section 66 is the extent (not the duration) of the impairment.

6.The foregoing is consistent with the position in relation to common law claims: Doherty v Liverpool District Hospital (1991) 22 NSWLR 284 at 290-297.”

A copy of Ms Griffey’s ‘Last Will and Testament’, together with a document ‘Consent to Act For the First Respondent’, indicating the consent of Ms Griffey’s parents “to act on behalf of Belinda Jane Griffey’s Estate in these proceedings”, was filed with the submissions lodged in the Commission 24 July 2008.

On Thursday 28 August 2008, the Solicitors for Ms Griffey informed the Commission that grant of probate is expected “within the next week or so.”

Meanwhile, on 30 July 2008, the Hospital filed in the Commission a notice dated 25 July 2008, pursuant to the Directions issued, stating:

“I advise that Sydney West Health Service will not be filing written submissions as to Ms Griffey’s death pursuant to the second direction made by Deputy President Byron on 15 July 2008.
Sydney West Area Health Service reserves its right to file written submissions in response.”

On 3 September 2008 Council filed its further written submissions in the Commission, in response to the Directions issued.

It submits that the death of Ms Griffey does not of itself prevent the award of compensation under section 66 of the 1987 Act, relating to permanent impairment “being maintained”. It states, “The right is taken to accrue as at the time of injury, as is implicitly supported by s.66(3): see TNT Australia Pty Ltd v Horne (1995) 11 NSWCCR 497.”

However, Council goes on to submit that the situation is different with regard to claims for pain and suffering pursuant to section 67 of the 1987 Act. It states:

“Section 67(5) provides that ‘Compensation under this section is not payable after the death of the worker concerned.’ The amount awarded in this regard has not yet been paid. The words of the sub-section speak clearly to the current situation – compensation is not payable following the death of Ms Griffey. As Kirby P stated in TNT Australia Pty Ltd v Horne at 510B, by juxtaposition of ss.66 and 67 of the Act, ‘it is difficult to escape the conclusion that claims of the kind referred to in s.67, being highly personal and subjective to the worker concerned, are extinguished at the worker’s death’, whilst claims ‘of the more objective kind provided by s.66 survive the worker’s death’. His Honour stated as much having quoted s.67(5), which was then in identical terms to the current sub-section.”

Council further submits:

“The representatives of Ms Griffey seek to rely on Bresmac Pty Ltd v Starr (1992) 8 NSWCCR 601 at 617A-B. What Priestley JA there stated was that ‘no compensation under s.67 is payable unless the worker who experienced the pain and suffering is alive at judgment to receive it.’ That statement does not support the position of the representatives of Ms Griffey in light of the nature of the functions to be exercised pursuant to s.352 of the 1998 Act.”

Council agrees that the Arbitrator made her decision prior to Ms Griffey’s death in which she found that Ms Griffey was entitled to payment of the maximum compensation payable under section 67 of the 1987 Act. However, that determination was subject to appeal, which is to be by way of review of the decision appealed against (section 352(5) of the Workplace Injury Management and Workers Compensation Act 1988 (‘the 1998 Act’). It submits that fresh evidence may be given if leave is granted by the Commission and in that regard, “there does not appear to be any dispute between the parties that the death of Ms Griffey may be taken into account as a new fact.” Council goes on to say:

“In State Transit Authority of NSW v Chemler [2007] NSWCA 249 at [22], Spigelman CJ described the provisions for review in s.352 as an ‘internal merits review’. At [30] His Honour stated that the presidential member exercising the power of review ‘must decide whether the original decision is wrong, or as it is often put in the context of administrative appeals on merits, must decide what is the true and correct view’.”

Council submits that taking these points together, “it is plain that the presidential member must decide on the true and correct view in light of the facts as they appear in the appeal before him or her, including any fresh facts.” Council cites, French J, as he then was, in Federal Commissioner of Taxation v Swift (1989) 18 ALD 679 at 691, in support of this proposition.

It submits that in light of the undisputed fact that Ms Griffey has passed away prior to the determination of the appeal made pursuant to section 352 of the 1988 Act, and in light of the “clear words of s.67(5) of the 1987 Act” there is no entitlement in the estate of Ms Griffey to receipt of pain and suffering payments pursuant to section 67 of that Act.

Council concludes by discussing its understanding that, and what follows from the fact that, Ms Griffey died “following the cessation of the provision of nutrition.” It concludes by submitting, “Thus nutrition may no longer be provided to PVS patients because they have no relevant consciousness or quality of life. It is that very fact which has apparently led to the sad death of Ms Griffey. Yet that fact also confirms the inappropriateness in any event of an award for pain and suffering.”

On 12 September 2008, Ms Griffey’s Solicitors filed in the Commission a certified copy of the Grant of Probate of her Last Will and Testament, dated 27 August 2008. The late Ms Griffey’s parents, Christine Griffey and Kevin John Griffey, to whom probate was granted, are the executors appointed under the Will. (See also [34] of these Reasons for formal admission of fresh evidence as to Ms Griffey’s death).

These proceedings do not abate by reason of Ms Griffey’s death (Rule 18.4(1), Workers Compensation Commission Rules 2006 (‘the Rules’)). An Administrator or executor may continue or defend proceedings in like manner as if he or she were a party claiming or defending in his or her own right (Rule 18.4(5)). Each of the other parties were notified of Ms Griffey’s death at the same time that it was made known to the Commission, and each was invited to make submissions in respect of that fact and its relevance to these proceedings. Pursuant to Rule 18.4(2) and 18.4(3), the following Order was made on 17 September 2008 and despatched by Document Exchange (‘DX’) to each of the parties:

“The Commission orders of its own motion, pursuant to Rule 18.4(2) and 18.4(3) of the Workers Compensation Commission Rules 2006:

1.   Belinda Jane Griffey is removed as the Applicant and party in these proceedings in the Commission;
2.   Christine Griffey and Kevin John Griffey as Executors of the Estate of Belinda Jane Griffey are added as Applicants and parties in these proceedings in the Commission, and
3.   the proceedings in the Commission shall be further conducted, accordingly.”

Rule 18.4(4) provides:

“If the Commission orders that a party be substituted for another party or a former party, all things done in the proceedings before the making of the order have effect in relation to the new party as if that party were the old party, unless the Commission otherwise orders.”

Meanwhile, on 15 September 2008 Ms Griffey’s Solicitors filed in the Commission, written submissions dated 11 September 2008 in response to Council’s further submissions dated 3 September 2008, as they were entitled to do. The submissions made are as follows:

“1.These submissions are in response to the Submissions on behalf of the Council dated 2 September 2008.

2.The obiter dicta of Kirby P (as his Honour then was) in TNT Management Pty Limited v. Horne (1995) 11 NSWCCR 497 at 510B have to yield to the unanimous judgment of the Court of Appeal in Bresmac Pty Ltd v. Starr (1992) 8 NSWCCR 801 at 617A-B. The Commission is, of course, bound by the holding in that case.

3.The suggestion (made in paragraph 5 of the Council’s Submissions) that there is no dispute that the death of Ms Griffey may be taken into account is quite without foundation as the reference to the decision of the Court of Appeal in Doherty v. Liverpool District Hospital (in paragraph 6 of the Estate’s Submissions) made clear. Ms Griffey’s life expectancy was uncertain: this is one of the matters which the Arbitrator was bound to take into account in making the assessment of compensation under Section 67 WC Act. The review process under Section 352 WIM Act is not a re-trial. The reasoning of the Arbitrator betrays no error: she found upon the basis of evidence (identified in paragraphs 15 and 18 of her Reasons) that Ms Griffey had some awareness of her plight. Section 67(5) of the WC Act makes the worker’s death irrelevant if it occurs after an award has been made. When the decision under review is without error, it would subvert the clear legislative intention expressed in Section 67(5) if regard was to be had to the death simply to enable the matter to be considered afresh on review.

4.The Council’s Submissions conclude with a submission, said to be based upon an understanding of the manner and cause of Ms Griffey’s death. This is a most unfortunate submission. It is tolerably clear that the directions given by the Commission on 15 July 2008 were directed to the fact of the death and not its manner and cause. The Commission did not grant leave under Section 352(6) WIM Act for fresh or additional evidence nor has the Council sought such leave. I do not propose to visit further distress upon the parents by seeking their instructions on this aspect without some good reason for doing so. There is no warrant for receiving further or additional evidence. At the hearing before the Arbitrator the Council paid scant attention to this issue of awareness – its primary focus being elsewhere. The Arbitrator (as has already been mentioned) relied on the observations and opinion of Professor Fearnside and Professor Dan. Professor Fearnside apparently saw no inconsistency between the diagnosis of PVS and his own opinion that Ms Griffey was probably aware from time to time. While at one stage the Council indicated that it wished to cross-examine Professor Fearnside, in the ultimate it did not do so and the evidence remained as described by the Arbitrator in her Reasons. There is no occasion at this late stage (the Council’s Submissions were served very late and without explanation) for re-opening this aspect of the matter.

5.The parents have been granted probate: a copy of the grant will be forwarded to the Registrar of the Commission and to the representatives of the parties.”

Council’s statements and submissions in relation to its “understanding” of the manner and cause of Ms Griffey’s death and what should be drawn from this, are not taken into account in these appeals. Council’s claimed “understanding” is not based on any evidence that is before me in these appeals. Furthermore, no application has been made by any party pursuant to section 352(6) of the 1998 Act and Rule 16.2(4)(c) for the admission of fresh or additional evidence in relation to the manner and cause of death. While the Commission is not bound by the Rules of Evidence (section 354(2) of the 1998 Act), it is not entitled to act upon or to take into account evidence that is not in fact before it. Moreover, unsubstantiated submissions are not evidence of what is being submitted.

The Hospital did not file written submissions in response to the further submissions filed in the Commission by the other parties.

There is no doubt, that the evidence of Ms Griffey’s death and the grant of probate should be admitted in this appeal. It would be unjust and pointless to do otherwise. Neither of the other parties has raised any objections. The procedure for lodging fresh evidence as set out in Rules 16.2 and Practice Direction 6 has not been complied with, strictly speaking. However, Rule 1.6(2) provides that the Commission may, if it thinks fit on terms, dispense with compliance with any of the requirements of the Rules, either before or after the occasion for the compliance arises. Having regard to the provisions of Rule 18.4 it may not be necessary, however, I formally dispense with the requirements of the Rules as to filing of the fresh evidence, and I grant leave to admit as fresh evidence, the certified copy of the grant of probate dated 27 August 2008 to which is attached a copy of Ms Griffey’s Last Will and Testament, as evidence of the fact of her death and the grant of probate to Christine Griffey and Kevin John Griffey as the executors of her Estate, appointed under her Will.

Having regard to the Order made on 17 September 2008 (see [29] of these Reasons), reference is made to ‘the Estate’ in lieu of ‘Ms Griffey’ as a party to these proceedings, following the heading hereunder, ‘SUBMISSIONS AND REVIEW OF THE ARBITRATOR’S DECISIONS’, where appropriate in the context, notwithstanding that most of the submissions were made prior to the notification of her death.

All of the further submissions (except for Council’s submission referred to in [32] of these Reasons), along with all other written submissions filed in these appeals, have been taken into account in the determination of these Appeals.

PROCEDURAL MATTER

It is convenient and appropriate to deal with both appeals together. All of the procedural and legislative requirements, relevant evidence, submissions, references, discussion and reasons for decision, relating to both matters, are recorded in this statement of reasons for decision (‘these Reasons’). The formal decision and orders in each matter are recorded appropriately in the Reasons (for decision) in each of the relevant appeals.

Accordingly, see also Council of the City of Sydney v Estate of Belinda Jane Griffey & Anor (No. 2) [2008] NSWWCCPD 115.

THE DECISIONS UNDER REVIEW

The Certificate of Determination’, dated 24 December 2007 records the Arbitrator’s orders as follows:

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

(i)The Council is to pay weekly benefits compensation to Ms Griffey at the maximum statutory rate for a single worker with no dependents pursuant to section 37 at the rate of $347.90 per week from 15 September 2006 to date and continuing.

(ii)The Council is to pay Ms Griffey’s reasonably necessary section 60 expenses upon production of accounts and/or receipts.

(iii)The Council is to indemnify the Hospital the costs incurred to date for all reasonably necessary hospital, medical and related treatment provided to Ms Griffey upon production of accounts and/or receipts pursuant to sections 61(8) and 62(7) of the Workers Compensation Act 1987 and that payment will satisfy any entitlement to Ms Griffey pursuant to section 60 to the extent of that payment.

(iv)The proceedings are to be listed for a further teleconference to deal with the issues pursuant to sections 60, 66 and 67.”

The ‘Certificate of Determination’, dated 12 March 2008 records the Arbitrator’s orders as follows:

“The determination of the Commission in this matter is as follows:
(i)The Respondent, being the Council, to pay the Applicant $200,000 pursuant to section 66 representing 100% whole person impairment.

(ii)The Respondent, being the Council, to pay the Applicant $50,000 pursuant to section 67.

(iii)The Respondent, being the Council, to pay the Applicant’s costs as agreed or as assessed. I am satisfied there were complex legal and factual issues in these proceedings which included the claim for weekly benefits and medical expenses and that these proceedings warrant being certified as complex for the purposes of Item 4 Table 4 Schedule 6 of the Workers Compensation Regulation 2003. I am satisfied that an uptake of 30% is appropriate in this matter given the amount of work required to be done by the parties and the uptake is applicable to all the parties in both matters 15593-06 and 1839-06.”

ISSUES IN DISPUTE

Arbitrator’s decision dated 24 December 2007

The issues in dispute are found in the Council’s “specific” grounds of appeal, submitting that the Arbitrator erred:

(i)in failing to find that the failure of the Hospital and its agents to order sodium tests (prior to 7 May 2004) and to diagnose hyponatraemia prior to 9 May 2004 was negligent and such as of itself to break any causal link to Ms Griffey’s motor vehicle accident;

(ii)in failing to find that the failure of the Hospital and its agents properly to communicate and act upon the 7 May 2004 “critical” sodium test result, was negligent and such as of itself to break any causal link to the motor vehicle accident;

(iii)in failing to find that the treatment of Ms Griffey’s hyponatraemia following its diagnosis on 9 May 2004 was negligent by reason of the sodium level being raised too quickly and saline was provided for too long such as of itself to break any causal link to the motor vehicle accident;

(iv)in erroneously holding that Ms Griffey’s brain injuries resulted from the motor vehicle accident;

(v)in erroneously failing to determine whether or not, and to what extent, the treatment provided to Ms Griffey by the Hospital and its agents was negligent, when such a finding was necessary;
(vi)in relation to the Council’s submission that the Hospital had no legal claim against the Council pursuant to sections 61 and 62 of the 1987 Act in all of the circumstances and in light of the doctrine of equitable set-off, misconstrued the derivative nature of the Hospital’s claims created by sections 61(8) and 62(7) of that Act; erroneously rejected the Council’s submission on the basis that there is “nothing” in sections 60-62 “regarding any set-off for negligent medical treatment” (at [48]) when such express reference in the legislation is not necessary for the argument to be legally available, and referred to there having been “no findings of negligence in these proceedings” (at [48]) when the Arbitrator’s own findings (eg at [4] and [42]) were tantamount to such and, further, when the necessity for determining such negligence arose inter alia by reason of the very argument as to equitable set-off put by the Council;

(vii)in relation to the Council’s submission that the Hospital’s claim should be rejected as a matter of the discretion inherent in sections 61(8) and 62(7) of the 1987 Act, failed to address whether or not the Hospital’s claim should have been declined as a matter of discretion, and failed to exercise the Commission’s discretion to decline the Hospital’s claim, and

(viii)in generally failing to make the correct and preferable decision with respect to the issues for determination on the evidence and submissions before her.

The Council states at [18] of its submissions on appeal:

“It can be seen that the first four grounds all go to the issue of causation (the fifth also touches upon it). Of those four grounds, the first three address in turn the three stages of the negligent conduct by the Hospital or its agents. The fourth ground of appeal goes to all three of these stages but deals with errors of reasoning and principle made by the Arbitrator with respect to the causation issue generally. It is thus in the section of these submissions dealing with the fourth ground that an overview of the applicable legal principles is set out.”

The Council elaborates upon each of these grounds in order to clarify and demonstrate them for the purposes of this appeal. These supporting statements are noted and considered in relation to the submissions made on appeal.

Arbitrator’s decision dated 12 March 2008

The issues in dispute in the appeal against the Arbitrator’s decision dated 12 March 2008, are in summary, that the Arbitrator erred:

a)in making an award in respect of the section 66 and section 67 claims, because the relevant impairment and the pain and suffering did not result from the injury suffered by Ms Griffey in the motor vehicle accident on 29 April 2004 (‘causation’), and

b)in awarding compensation pursuant to section 67 of the 1987 Act, as the evidence did not establish that Ms Griffey has suffered or is suffering “significant pain and suffering given the very nature of her permanent impairment” (‘treatment of evidence’).

ON THE PAPERS REVIEW

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.”

The Council submits in both appeals that the matters should not be dealt with solely on the basis of the papers, due to the substantial amounts of money in dispute, the complexity of the issues in dispute, the significant ongoing care required by Ms Griffey, the “ramifications for the Supreme Court action against the Hospital, and possibly also for Ms Griffey’s Supreme Court claim against the Hospital”, and finally, that “the decision by the Arbitrator is attended by real doubt and error”. The Council seeks an oral hearing. The Hospital submits that the appeals should not be determined on the papers alone. The Estate submits that it is inappropriate for the first appeal not to be dealt with on the papers, but says that it is inappropriate for the second appeal to be dealt with on the papers. The reason for the difference is not given and is not apparent.

The submission by Council in favour of an oral hearing is brief and to the point. The Hospital agrees with the Council’s submission but makes no particular submission in support. Ms Griffey’s legal representatives similarly make no submission in support of their apparently disparate views on the issue. None of the parties suggests that there is anything more of substance to add to what is already before me, apart from the death of Ms Griffey in May 2008, which was notified to the Commission on the day following the allocation of this appeal to me. However, this event appears to have been dealt with adequately in the further written submissions filed in the Commission, following the issue of Directions regarding the matter.

In considering this question and in relation to the exercise of my discretion, I have reviewed all of the evidence, submissions, transcript of proceedings before the Arbitrator, and other relevant material that was before the Arbitrator and that is now before me, in addition to all written submissions made by the parties in these appeals. This material is detailed, is substantial in terms of content and volume, and appears to be comprehensive as to the facts, the circumstances and the law, insofar as all of this is relevant to this jurisdiction.

After careful consideration I am satisfied that I have sufficient information in connection with these proceedings to determine the appeals, without holding a conference or formal hearing. Matters to which I have had regard in arriving at this view, include:

·all of the material that was before the Arbitrator, including a large volume of transcript of evidence and oral submissions made by Senior Counsel, two folders of printed legal authorities, a significant volume of written submissions and supplementary written submissions, a large volume of documentary evidence, including medical evidence and items of correspondence between the legal representatives of the parties, the Reasons of the Arbitrator in both matters determined by her, the Commission file and the Arbitrator’s file, and
·over 90 pages of written submissions on appeal by the Council, the Appellant in both matters, in excess of 50 pages of written submissions on appeal by Ms Griffey, and 24 pages of written submissions on appeal by the Hospital (noting that the Hospital elected not to provide submissions in Opposition to the second appeal on the basis that:

“As the Appeal relates to sections 66 and 67 of the Workers Compensation Act, Sydney West Area Health Service does not intend to lodge with the Commission or serve on the other parties a Notice of Opposition, the issue of causation being adequately ventilated in submissions on the main appeal.”

(per letter from GIO, General Insurance Law Department dated 6 June 2008 – see also [12] above, of these Reasons).

The parties appear to have been comprehensive in the preparation and presentation of their detailed evidence, arguments and submissions, and I consider that the totality of what is now before me is sufficient in the circumstances, for the purposes of determining the appeals, without the need to revisit it all yet again in an oral hearing. I note particularly that each of the parties has been afforded every opportunity to make exhaustive written submissions in support of its/her case, and none of the parties has tendered fresh or additional evidence (or has indicated any intention to call further evidence), except for the notification of Ms Griffey’s death and the subsequent grant of probate. Neither of these aspects is contentious in these appeals.

Accordingly, I formally indicate that having regard to Practice Directions Numbers 1 and 6, the documents and materials that are before me, and what is outlined above, 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 of the appeals, and in this jurisdiction.

LEAVE

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 amount at issue on appeal in each instance satisfies the monetary threshold requirements of section 352(2) of the 1998 Act.

The appeals were lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.

Leave to appeal in each matter is granted.

REVIEW OF ARBITRATOR’S DECISION ON APPEAL TO A PRESIDENTIAL MEMBER

Each of the grounds of appeal in the first appeal (Certificate of Determination dated 24 December 2007) is predicated upon Arbitrator error, including the final ground of appeal in which it is submitted that the Arbitrator failed to make the correct and preferable decision. In summary, the Council’s grounds of appeal are comprised of issues as to causation, alleged breach on the part of the Hospital in its treatment of Ms Griffey, the existence or otherwise of any legal claim by the Hospital against the Council in this jurisdiction, the alleged failure of the Arbitrator to exercise a discretion to decline the Hospital’s claim, and as just stated, alleged failure on the part of the Arbitrator to make the correct and preferable decision.

Each of the grounds of appeal in the second appeal (Certificate of Determination dated 12 March 2008) is also predicated upon Arbitrator error. The first issue is again, causation, affecting the orders for payment pursuant to sections 66 and 67 of the 1987 Act. The second issue is the correctness or otherwise of Arbitrator’s findings and award in relation to the claim made pursuant to section 67 of that Act.

Section 352(5) of the 1998 Act provides:

“An appeal under this section is to be by way of review of the decision appealed against.”

Council submits at [15] of its first submissions on appeal:

“In this context the City seeks leave to appeal from the determination pursuant to s.352 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’). The review process provided for by that section is, of course, broader than an “appeal” in its usual legal usage. Pursuant to subs. (5), an appeal under this section ‘is to be by way of review of the decision appealed against’. As Beazley JA indicated in Ormwave Pty Limited v Smith [2007] NSWCA 210 at [6], with respect to s.352, that ‘An appeal by way of review extends to a review of the primary decision on both fact and law.’ Spigelman CJ stated in State Transit Authority of NSW v Fritzi Chemler [2007] NSWCA 249 at [28] [(‘Chemler’)] that ‘[t]he concept of a review on the merits is wider than the concept of an appeal in a judicial context’. His Honour continued at [30]:

‘A Presidential member exercising a power to review a decision must decide whether the original decision is wrong or, as it is often put in the context of administrative appeals on merits, must decide what is the true and correct view. If s/he does so decide then s/he should substitute his or own views, unless it is an appropriate case to remit.’”

Ms Griffey makes no submissions on the nature or extent of the review on appeal, of the Arbitrator’s decisions.

The Hospital submits as follows:

“8. The City’s written submissions are an attempt to have the matter ‘re-heard’.

9.This appeal is by way of review (section 352(5)) and is not a rehearing of the matter where the Commission is re-exercising the power of the Arbitrator at first instance by hearing the matter ‘de novo’ and coming to a fresh decision. A review is not intended to be a full second hearing – see The King Island Company Ltd v Deery [2005] NSWWCCPD 1 at [19]; see also Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194. The powers of the Presidential member to revoke the decision pursuant to section 352(7) of the 1998 Act and to substitute a new decision in its place are exercisable only where it is demonstrated that the decision of the Arbitrator is affected by some legal, factual or discretionary error (Allesch v Maunz (2000) 203 CLR 172).

10.None is shown in the present instance. Rather, the Council’s original submissions are repeated, only amended to include allegations of error. The nature of the review was further considered by the Court of Appeal in State Transit Authority of New South Wales v Fritzi Chemler [2007] NSWCA 249 where Spigelman CJ said at [28] and [30] that while the concept of a review on the merits is wider that the concept of an appeal in the judicial context, a Presidential member exercising a power to review a decision must decide whether the original decision is wrong, or must decide what is the true and correct view.

11.An Arbitrator’s reasons should be read as a whole and it is not for a Presidential member on review to comb through the Arbitrator’s findings and reasons in search of error (Beale v GIO (NSW) (1997) 48 NSWLR 430 AT 444; Minister for Immigration & Multicultural Affairs v Liang (1996) 185 CLR 259). Further, it is not necessary for an Arbitrator to refer to every piece of evidence – see Ainger v Coffs Harbour City Council [2005] NSWCA 424.
12.The Arbitrator has in her Statement of Reasons for Decision set out the essential ground or grounds upon which her decision rests, she has provided a rational examination and analysis of the evidence and the issues and has recorded the findings she has made based on the evidence. Further, she has stated generally and briefly the grounds which have led her to her conclusions concerning contested issues (there being few disputed factual questions) and it cannot be said that she has made virtually no reference to the Council’s medical or legal case – see [10] to [20] of the Statement of Reasons for Decision.

13.Section 354 of the 1998 Act permits the Commission to conduct its proceedings with little formality and technicality as the proper consideration of the matter permits, not to be bound by the rules of evidence and to act according to ‘equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms’ – see section 354(3) in the 1998 Act. So long as each party has notice of, and a reasonable opportunity to address, the case against it, there is no reason to suppose that the Commission is not at liberty to determine how it will proceed and whether it should make a new decision – see Chemler at [65]. It remains open to the Presidential member to consider and assess the findings made by the Arbitrator.

14.However, the Council’s submissions ignore the Arbitrator’s decision, her decision making process and her referral to evidence and amount to a reiteration of submissions made in the course of the hearing before the Arbitrator except that they additionally submit in failing to accept the Council’s initial submissions, she fell into error. No issue lies unvisited on review.

15.The Council’s submissions also set out in some detail an analysis of the medical records, contrasting them to the article by Doctors Pandit, McLean, Seppelt and Park [130] concerning treatment provided and the management plan of Dr Seppelt (Exhibit 2, page 192). The analysis provided is irrelevant and devoid of support from an expert.”

I agree that the Council’s submissions on appeal are lengthy and detailed, addressing the issues that were before the Arbitrator. However, the Council has not in my view, specifically requested or submitted that the review of the Arbitrator’s decision should be conducted strictly as, a “hearing de novo”. It has however, submitted that the review to be conducted “is, of course, broader than an ‘appeal’ in its usual legal usage.” In this regard, I note that both the Council and the Hospital have acknowledged and cited Chemler, in which Spigelman CJ states at [28] that a ”review on the merits” is to be conducted by the Presidential member in the determination of an appeal from an Arbitrator of the Commission.

On 27 June 2008, in Cook v Midpart Pty Ltd trading as McDonalds Forster & Anor [2008] NSWCA 151, the NSW Court of Appeal said at [10] per Allsop P (with whom Ipp and Bell JJA agreed):

“The decision of this Court in Duinker v St Vincent de Paul Society Aged and Special Services Limited (Lewisham Nursing Home) [2008] NSWCA 127 at [32] (Hodgson JA, with whom Beazley JA and McColl JA agreed), the discussion in State Transit Authority of New South Wales v Chemler [2007] NSWCA 249 at [22] – [29] (Spigelman CJ, with whom Basten JA and Bryson AJA agreed) and [63] – [66] (Basten JA) and Jeffery v Lintipal Pty Limited [2008] NSWCA 138 at [11] (Basten JA, with whom Hodgson JA agreed) provide powerful support for the proposition that the appeal in s352 of the WIM Act that is to be ‘by way of review’ (s352(6)) is not limited to the identification and correction of error on the part of the Arbitrator. (That is not to say, however, that any demonstrated error would not be persuasive in any appeal.) I will return to the consequences of the approach of the Presidential member at the end of these reasons.”

His Honour further observed at [59] – [61] that notwithstanding the expression of approach made by the Presidential member, he did review the matter for himself by examining the facts and reaching his own conclusion. The Court went on to say that in any event, the approach expressed by the Presidential member was not a separate ground of appeal and it was therefore unnecessary for the Court to decide the question as to the correct approach to be taken. Allsop P said at [60]:

“This should not be taken as intended to throw any doubt on the views of Hodgson JA in Duinker that the authorities clearly suggest that it is not limited to the correction of error. It was unnecessary for the Court in Duinker to decide the issue, as it is unnecessary for us to do so.”

His Honour concluded on the point by stating at [61]:

“All the complaints about the approach of the Presidential member have been discussed and all fail to found any interference by this Court. In these circumstances, what might be seen to be an error in expression of the general approach by the Presidential member was not in any way operative in affecting his decision.”

On 21 August 2008, the Court of Appeal in Tan v National Australia Bank Ltd [2008] NSWCA 198, on appeal from the decision of a Presidential member of the Commission, considered the jurisdiction of the Deputy President at [4] – [13]. The Court, per Basten JA said at [5] that none of the authorities relied on by the Commission [in stating the basis for the review by the Presidential member] gave proper consideration to the requirement in section 352(5) of the 1998 Act that the appeal is to be “by way of review of the decision appealed against.” His Honour went on at [6] to cite Brandy v Human Rights and Equal Opportunity Commission [1995] HCA 10; 183 CLR 245 at 261, and the explanation provided by Mason CJ, Brennan and Toohey JJ:

“But what emerges from the judicial decisions and, for that matter, from statutes is that ‘review’ has no settled pre-determined meaning; it takes its meaning from the context in which it appears.”

At [8] His Honour stated:

“The nature of the appeal from the arbitrator to the Deputy President must be identified by reference to the statutory scheme provided by the Workplace Injury Act, in particular ss 352 and 354.”

Following a discussion at [9], of the degree of control placed in the Presidential member by the statute, with respect to both the availability of the appeal and the manner in which it is to be conducted, His Honour went on to say at [10]:

“Where an appellant tribunal has power to hear further evidence, the appeal will commonly be one by way of rehearing, which requires determination of the appeal in accordance with the facts and law as they appear to the appellate tribunal. If the facts presented, or law applicable, on the appeal differ from those considered at the first hearing, it may seem inappropriate to say that the original decision-maker has erred; rather, it may be preferable to describe the decision as erroneous. An example may be found in Western Australia v Ward [2002] HCA 28; 213 CLR 2 where a particular ‘error’ arose from statutory amendments which came into effect after the trail judgment was delivered: see [65]-[71].”

In further discussion His Honour stated at [11] that, as noted in McKee v Allianz Australia Insurance Ltd [2008] NSWCA 163, the term “review’ may connote a fresh consideration of a matter, without the need to find error before setting aside or varying the decision below. He went on to say, “But even in a hearing de novo the appellate tribunal will not necessarily disregard conclusions reached by the original decision-maker.”

After pointing to constraints that may arise at various stages of the review, His Honour concluded his discussion of the point, at [12] and [13], as follows:

“12The fact that the term ‘appeal’ may refer to a hearing de novo, the fact that the appeal is described as one ‘by way of review’, together with the largely unlimited discretion conferred on the Deputy President as to the manner in which the appeal will be conducted and the broad powers, including the power to make a ‘new decision’ in place of that subject to appeal, all tend to confirm that the Deputy President may conduct a fresh hearing and is not constrained to intervene only if satisfied that the decision of the arbitrator was affected by identifiable error. There is no need to consider the constraints on the Deputy President, which may arise from the circumstances that the arbitrator made findings based on credit in respect of oral testimony, where witnesses were not recalled on appeal.

13In the present case, the Deputy President approached the appeal on the basis that it was necessary to identify error on the part of the arbitrator. This she did in three respects summarised at [16] below. On one view, this renders it unnecessary to determine the precise nature of the appeal provided by s 352, from a decision of the arbitrator. On the other hand, if it were not necessary for the Deputy President to identify error, the appellant cannot succeed in this Court merely by showing an error in point of law with respect to a finding of the Deputy President as to error on the part of the arbitrator; it is necessary for her to show error affecting the new decision of the Deputy President.”

I note the foregoing statements and observations made by the Court of Appeal. The review of the Arbitrator’s decisions in these appeals is conducted accordingly.

JURISDICTION OF THE COMMISSION

The jurisdiction of the Commission is set out in section 105 of the 1998 Act. In Raniere Nominees Pty Limited trading as Horizon Motor Lodge v Daley and Another [2006] NSWCA 235 (‘Raniere’), Santow JA (with whom Spigelman CJ agreed) said at [66]:

“Thus, in acting judicially in its decision-making, the Commission is governed by statute. It does not possess an inherent jurisdiction but only such powers which are incidental and necessary to the exercise of its statutory jurisdiction; see DJL v Central Authority [2000] HCA 17; (2000) 201 CLR 226 at [24ff]. It has no statutory power expressly permitting it to extend the time for the employer to make the application under s145(3). I do not consider that use of the word ‘may’ in s145(3) does so impliedly; the section is an enabling one so that ‘may’ in effect means ‘must’.” [Emphasis added].

Any purported exercise of power beyond that would necessarily be of no legal effect: (see Commissioner of Police v Donlan, Commissioner of Police v Hanson [1995] NSWSC 106, per Clarke JA (with whom Handley JA agreed), at [12]).

THE COURSE OF EVENTS

There is little dispute of substance as to the factual background of this matter.

At [9] of her Reasons in the first appeal (Certificate of Determination dated 24 December 2007), the Arbitrator sets out a useful history of the relevant course of events, following upon the motor vehicle accident on 29 April 2004. Having regard to the detailed nature of submissions on appeal and the technical, medical facts relevant to each appeal, it is helpful to reproduce the Arbitrator’s summary of those events. She states:

“It is instructive to set out the course of events from the time of the accident. This following summary is extracted from the Hospital Notes and Records:

(i)At the scene of the accident Ms Griffey was noted by the ambulance officers to be confused with multiple lacerations to her scalp as well as a contusion and swelling in the right parietal region. She had some decreased level of consciousness and had no recollection of the incident. Her Glasgow Coma Score (GCS) being 14 at the scene. Ms Griffey was given morphine for her pain.

(ii)A catheter was inserted to enable her to pass urine and she was prescribed analgesics for the pain including Panadeine Forte, Nurofen and Tramadol. The nursing notes noted that around 4 May, 2004 Ms Griffey was menstruating and that ‘migraine persists’ and that her partner complained that she seemed disorientated to time, place and awareness of who has visited.

(iii)On 5 May 2004 the nursing notes note that Ms Griffey’s urine output was low and dark indicating dehydration so she was encouraged to drink fluids. It was also noted that she had vomited that day and so was given Maxolon as an anti-emetic. At 8:30 that night an intern reviewed her primarily because of the reduced urine output. She was said to have a moist tongue, a poor indicator of dehydration. She was encouraged to increase her fluid intake and a urine sample was sent for biochemistry analysis. At 10:30 on the night of 5 May 2004 Ms Griffey complained of a headache and she vomited again. She was again encouraged to drink more fluids.

(iv)On 6 May 2004, Ms Griffey was noted to have slept soundly with no pain or vomiting, and a satisfactory urine output. Later that day however she again complained of headache and vomiting. Tramadol was stopped and she was given Endone as an analgesic. Still later at 10:50 pm she was recorded as having vomited twice and complaining of feeling nauseous, dizzy and sweating but she was found to be afebrile. The surgical registrar was telephoned and an anti-emetic drug was prescribed over the telephone. During that night she was also given Temazapam to help her to sleep. There was no further complaint of nausea or vomiting.

(v)On 7 May 2004 Ms Griffey was attended by Dr Sunner who noted she had a bowl next to her. This was the first time she informed him that she had been feeling nauseated and had headaches the previous day. A CT scan of her head was organised to rule out any head injury during the car accident. That CT scan demonstrated no abnormality. Neurological observations were instituted. Sometime between 11:45 am and 2:20 pm on 7 May 2004 it was recorded by a registered nurse that Ms Griffey’s sodium level was 111 mmol per litre. It was not indicated in the nursing notes that this was a critically low level but the biochemistry results, which were received at a later time, stated this level was critical. There is no record that this sodium level was communicated to relevant medical staff. During this time Ms Griffey’s cather [sic] was draining well.

(vi)There is an untimed entry on 8 May 2004 that Ms Griffey was feeling better but a later recording that day indicated that she had vomited again. One of her visitors mentioned to staff that she was complaining of blurred vision and her speech was slow.

(vii)At ten minutes past midnight on 9 May 2004 a Surgical Registrar carried out a neurological examination of Ms Griffey. It was recorded that Ms Griffey told her she had blurry vision for 2 to 3 days, the left more than the right. She recorded no headaches, no loss of vision, no slurring of speech, sensory changes or bowel and bladder changes and no weakness in upper or lower limbs. It is not clear whether these are findings on examination or whether this was a recorded history in which case it is inconsistent with the nursing notes for the previous days. The doctor found Ms Griffey to be drowsy but easily rousable and that her GCS was 15 (a good result) and that she was orientated in time, place and person. The doctor’s impression was that the drowsiness was secondary to the Endone. The doctor recorded the neurological observations, which did not reveal any abnormality. Eye movements were normal, pupils were equal and reacting to light. Visual acuity was reduced but no abnormality was detected. The CT scan was noted to be in normal limits. The doctor noted that there would be a discussion with the medical registrar, that neurological observations would continue and that she would be reviewed if she deteriorated clinically. Temazapam was stopped. At 6.15 am the nursing notes indicate that Ms Griffey remained drowsy but was rousable, but her speech was slow and she was slow to respond. Right-sided weakness was noted in the arm at 11:30 am that day. The right leg was difficult to determine given she was in traction. On 9 May 2004 at midday the Medical Registrar Dr Kandy recorded that Ms Griffey had been unwell since 4 May 2004. He noted she had complained of blurred vision and slurred speech. He noted she was alert but incoherent and disoriented in time, place and date. He noted weakness on both sides mainly the upper limbs and he noted her sodium on admission was 136 mmols/litre but on the previous Friday it was 111 mmols/litre. He noted it had not been checked. A repeat biochemistry test showed that her sodium had dropped to 97 mmols per litre with a serum osmolality of 196. Dr Kandy’s impression was that her symptoms were secondary to the syndrome of inappropriate anti-diuretic hormone secretion (SIADH), which was secondary to the head injury and the morphine. Dr Kandy recommended that Ms Griffey be transferred to the High Dependency Unit and/or the Intensive Care Unit (ICU).

(viii)At the ICU, Dr Seppelt, the Intensivist, diagnosed symptomatic hyponatraemia. He carried out a review of Ms Griffey’s biochemistry and noted that she had at least three days of classic symptoms. Her management plan was 20% Sodium Chloride 20 ml given as an immediate infusion injection and then 3% sodium chloride at 100 mml to be given every hour until her sodium reached 115 and then switching to 0.9% (normal) saline. Her sodium was to be checked every two hours. At 5:30 on 9 May 2004 Dr Stephenson from ICU recorded her diagnosis was cerebral oedema secondary to hyponatreamia. He noted her sodium was 97. Dr Stephenson’s impression was that Ms Griffey had hyponatraemia with resultant neurological dysfunction caused by [Syndrome of Inappropriate Anti-diuretic Hormone Secretion] SIADH. At the ward round in ICU on 9 May 2004 Ms Griffey’s blurred vision was noted to be improving and she was orientated in time and place. It was noted her sodium level was 111.

(ix)On 10 May 2004 nursing staff recorded an infusion of 100 mls per hour of normal saline was given to Ms Griffey and that it changed from 3% saline when sodium reached 115 mmols per litre as instructed. Ms Griffey’s urinary output was noted to be ‘huge’ in amount and clear via the catheter. Slurred speech was also still present. She was described as being ‘bright, alert, pain free and bubbley (sic)’. At 9:45 am on 10 May 2004 the ICU ward round was conducted by Acting Professor McLean who noted Ms Griffey’s GCS was 15 and that her vision had improved although there was still some dysarthria remaining. He noted her sodium level was 126.3 mmols per litre. According to Professor Watson this meant a correction in the sodium from 96 at 12:53 on 9 May to 126 over a 17 hour period – that is 1.78 mmols per hour. Ms Griffey appeared to be alert and cooperative. At 9:10 on 10 May it was noted that the sodium was correcting but that there are ‘concerns that Belinda had symptoms for a few days and was not treated worried there is some residual damage that an MRI may be able to pick up’.

(x)On 11 May Ms Griffey was noted to be stable with a GCS of 14-15 but at 8:40 pm the orthopaedic team noted a reduced GCS and at 9:10 pm the physiotherapist noted her condition had worsened – her eyes were open but she was not responsive. It was noted there was a big change in the level of consciousness. On 1 May Ms Griffey was reviewed by Dr Park, a Neurologist. He noted an EEG was showing periodic lateralising epileptic seizures consistent with continuous partial seizures. Medication was suggested to deal with these. At 4:00 pm on 11 May Ms Giffey was exhibiting increased confusion, disorientation and right-sided convulsions. They were treated but around 12:30 there was an increase in seizure activity and these continued so Ms Griffey was intubated and ventilated. At 6:15 pm she was unresponsive, eyes were glazed, unable to focus, groaning, snoring, making movements, she became agitated and she was having focal seizures. There has been no improvement in her condition since. By 16 May 2004 she was showing signs of brain damage. Tragically Ms Griffey sustained irreversible brain damage resulting in a persisting vegetative state with quadriplegia. On 28 May 2004 Dr Seppelt noted it was ‘still not clear why she developed profound hyponatraemia with SIADH’. He considered it was multi-factorial and that the combination of menstruation, pain, opioid analgesia and Tramadol was a possible cause.”

SUBMISSIONS AND REVIEW OF THE ARBITRATOR’S DECISIONS

This review is conducted, and the specific issues on appeal in both matters are conveniently dealt with, under the headings that follow.

Causation

The Law

It is necessarily true that Ms Griffey would not have required medical treatment in the Hospital, ‘but for’ the injuries sustained in the motor vehicle accident. The logical character of this connection is clear. However, the sine qua non essence of the proposition, does not of itself establish a causal connection between the separate incidents of the motor vehicle accident and what occurred in the Hospital, or establish a legal liability for payment of compensation. “… the mere proof that certain events occurred which predisposed a worker to subsequent injury or death, will not, of itself, be sufficient to establish that such incapacity or death ‘results from’ a work injury. What is required is a commonsense evaluation of the causal chain.” (Kooragang Cement Pty Ltd v Bates (1994) 35 NSWLR 452 at 463 (‘Kooragang’)). See also March v Stramare (E & MH) Pty Ltd [1991] HCA12; (1991) 171 CLR 506 (‘March’), per Mason CJ at [23] where he stated, “… the ‘but for’ test does not provide a satisfactory answer in those causes in which a superseding cause, described as a novus actus interveniens, is said to break the chain of causation which would otherwise have resulted from an earlier wrongful act.”

In this matter the Council’s position is that the chain of causation of injury was broken by a novus actus interveniens, being the negligence of the Hospital in the medical treatment reasonably sought for injuries sustained in the motor vehicle accident. It submits that the separate and distinct injury that arose by reason of that regime of treatment is not compensable under the Workers Compensation legislation. On the other hand the Estate and the Hospital submit essentially, that the chain of causation was not broken and that injury occurred and developed in a factually causative way in circumstances that evolved throughout the treatment administered to her, in seeking to alleviate the injuries she sustained in the accident.

The question to be asked is twofold: if there is a chain of causation, was it broken to the extent that it was rendered inoperative, or “functus officio” as described in Davies v Swan Motor Co (Swansea) Ltd [1947] 2 KB 291 at 318 (‘Davies’), or was the initiating ‘action’ still operative and the subsequent events part of the history or “circumstances in which the cause operates”, Minister of Pensions v Chennell [1947] KB 250 at 256 (‘Chennell’)? These are questions of fact, having regard to the circumstances of the case.

The test of causation under the Workers Compensation legislation is whether the incapacity or medical treatment resulted from the work injury sustained. In Kooragang, Kirby P stated at 462, Sheller and Powell JJA agreeing, in considering the principles of causation in the jurisdiction, that since English authority in 1909:

“… it has been well recognized in this jurisdiction that an injury can set in train a series of events. If the chain is unbroken and provides the relevant causative explanation of the incapacity or death from which the claim comes, it will be open to the Compensation Court to award compensation under the Act.”

However, the Court of Appeal stated that the importation of notions of “proximate cause” [alone] by the use of the phrase “results from” are not now, accepted.

His Honour continued at 463-464:

“The result of the cases is that each case where causation is in issue in a workers compensation claim, must be determined on its own facts. Whether death or incapacity results from a relevant work injury is a question of fact. … What is required is a common sense evaluation of the causal chain. As the early cases demonstrate, the mere passage of time between a work incident and subsequent incapacity or death, is not determinative of the entitlement to compensation. In each case, the question whether the incapacity or death ‘results from’ the impugned work injury … is a question of fact to be determined on the basis of the evidence, including, where applicable, expert opinions. Applying the second principle, which Hart and Honore [H.L.A. Hart & Tony Honorĕ, Causation in the Law 2^nd ed., (New York: Oxford University Press, 1985)] identify, a point will sometimes be reached where the link in the chain of causation becomes so attenuated that, for legal purposes, it will be held that the causative connection has been snapped. This may be explained in terms of the happening of a novus actus. Or it may be explained in terms of want of sufficient connection. But in each case, the judge deciding the matter will do well to return as McHugh JA advised, to the statutory formula and ask the question whether the disputed incapacity or death ‘resulted from’ the work injury which is impugned.”

The concept of the ‘chain of causation’ is demonstrated by the facts in Kooragang. The worker developed back pain in 1981 while he had been climbing frequently up and down from his truck. He was diagnosed with advanced discogenic disease that was aggravated by excessive movement, as described. He was off work for some nine months. After returning to work he appeared to cope well, but in May 1983, while lifting bags of cement, pain increased down his leg. He was certified fit for light duties. However, none were available and he ceased work and received payment of workers compensation. His own doctor considered that he was distressed because of the delay in resolving his claim. In May 1986, his doctor found him to be very severely depressed because of the chronicity of his condition. This continued for several years and in March 1992 his workers compensation payments ceased. On 8 June 1992 he died of a myocardial infarction. The trial judge found that the acceleration of his cardiovascular disease and myocardial infarction resulted, in a relevant sense, from his back injury sustained in 1981. On appeal, the Court of Appeal found that there was an unbroken chain of undisputed evidence and consequently, upheld the trial judge’s finding that the worker’s death had resulted from his back injuries at work in 1981 and 1983.

“Questions of causation are not answered in a legal vacuum. Rather, they are answered in the legal framework in which they arise.” (Chappel v Hart [1998] HCA 55; [1998] 195 CLR 232, per Gaudron J at [7] (‘Chappell’). See also Kooragang per Kirby P at 464). In the instant matter, the legal framework is the workers compensation legislation. Most of the authorities in relation to the matter of novus actus interveniens are necessarily, of qualified practical relevance to a claim for workers compensation, which resides within a particular statutory framework. Many of such authorities are concerned with common law claims. The facts and circumstances of each case are invariably different. In Vairy v Wyong Shire Council (2005) 223 CLR 422, Gleeson CJ and Kirby J warned:

”It is understandable that in the search for consistency, comparisons with similar cases will be made. However, as Lord Steyn said in Jolley v Sutton London Borough Council [2000] 1 WLR 1082 at 1089, decided cases in this area are fact-sensitive, and it is a sterile exercise involving a misuse of precedent, to seek the solution to one case in discussions on the facts in other cases.”

What needs to be established to give rise to a novus actus interveniens is, upon a common sense evaluation of the causal chain in the instant case, a “new cause” which has disturbed the sequence of events, and which can “be described as either unreasonable or extraneous or extrinsic” (per McHugh JA in Bennett v Minister of Community Welfare (1992) 176 CLR 408 at 428 (‘Bennett’) quoting Lord Wright in Lord v Pacific Steam Navigation Co Ltd (The Oropesa) [1943] 1 All ER 211 (‘The Oropesa’)). Before the novus actus can be regarded as the sole cause of the ultimate incapacity, it must be demonstrated that the incapacity that would have resulted from the injury sustained in the motor vehicle accident has been replaced by a different and intervening cause that produced the ensuing incapacity.

In The Oropesa, Lord Wright stated, as referred to in Migge v Wormald Bros. Industries Ltd [1972] 2 NSWLR 29 at 36:

“To break the chain of causation it must be shown that there is something which I will call ultroneous, something unwarrantable, a new cause coming in disturbing the sequence of events, something that can be described as either unreasonable or extraneous or extrinsic.”

Hart and Honorĕ describe “the problem” thus, at page 134:

“The type of problem we consider, stated in the traditional causal language, involves three terms. In its simplest form the question is whether certain harm is the consequence of a certain wrongful act given the presence of a third factor, e.g. whether the death in hospital of a person negligently run down by defendant is the consequence of defendant’s negligent act, given some third factors such as that [the] deceased was an alcoholic and delirium tremens flared up after the accident; that he contracted scarlet fever from the attending physician; that a surgeon was negligent in performing an operation on him or, mistaking him for another patient, operated on the wrong side; or, taking pity on his sufferings, deliberately killed him, or that on the way to hospital he was struck by a falling tile. In all these instances we assume [sine non qua] that the [initial] wrongful act and the third factor were each a necessary condition of the harm, but in each instance a causal problem is raised by the presence of the third factor: the law must decide whether or not the third factor negatives causal connection.”

In Bailey amp [1999] NSWSC 1391; 1 Ors v Redebi Pty Limited 1 Ors [1999] NSWSC 918 (13 September 1999) (‘Bailey’), in determining a claim for common law damages, Santow J said at [99];

“It will generally speaking, not be possible to establish a novus actus interveniens unless:

(a) the breach is shown to have had no causative effect, even of the ‘but for’ kind, because the injury would have occurred, or the same risk of it, even if the duty had been performed; compare Chappel v Hart [1998] HCA 55; (1998) 156 ALR 517; 72 ALJR 1344 (where the minority would have concluded that a surgeon’s failure to warn did not materially contribute to the plaintiff’s injury),

(b) the intervening act or decision was not a reasonably foreseeable consequence of the negligent act in the sense of being ‘in the ordinary course of things the very kind of thing likely to happen as a result of the defendant’s negligence’ (per Mason CJ in March v E & M H Stramare Pty Ltd [1991] HCA 12; (1991) 171 CLR 506 at 517-8).

(c) there was no positive duty to take precautions against the happening of the intervening act or that class of act; contrast the finding of the House of Lords in Reeves v Commissioner of Police of the Metropolis [1999] UKHL 3 WLR 363 that there was a positive duty of care to guard against that very act – suicide by a prisoner – so precluding any defence based on novus actus interveniens (or volenti) despite the autonomous nature of the prisoner’s decision.”

In Alexander v Cambridge Credit Corporation Ltd (1987) 9 NSWLR 310 at 361, McHugh JA (as he then was), citing Mahony v J Kruschich (Demolitions) Pty Ltd [1985] HCA 37; (1985) 156 CLR 522 (‘Mahony), said:

“Mahony makes it clear (at 529-530) that the exacerbation of an injury by a negligent medical treatment though reasonably foreseeable, may constitute a novus actus interveniens if the treatment is inexcusably bad or improper.”

However, it is instructive to consider the context in Mahony from which the statement made by McHugh JA was derived. In that case, the High Court said at 529-530:

“In particular circumstances, minds may differ as to whether a subsequent injury was foreseeable or whether it is too remote to be regarded as a consequence for which an earlier tortfeasor may be held liable. When an injury is exacerbated by medical treatment, however, the exacerbation may easily be regarded as a foreseeable consequence for which the first tortfeasor is liable. Provided the plaintiff acts reasonably in seeking or accepting the treatment, negligence in the administration of the treatment need not be regarded as a novus actus interveniens, which relieves the first tortfeasor of liability for the plaintiff’s subsequent condition. The original injury can be regarded as carrying some risk that medical treatment might be negligently given: see Beavis v Apthorpe (24); Moore v A.G.C. (Insurance) Ltd (25); Lawrie v Meggitt (26); Price v Milawski (27); Katzman v Yaeck (28). It may be the very kind of thing which is likely to happen as a result of the first tortfeasor’s negligence: cf. per Lord Reid in Dorset Yacht Co. v Home Office (29). That approach is consistent with the view taken in workers’ compensation cases that the total condition of a worker whose compensable injury is exacerbated by medical treatment, reasonably undertaken to alleviate that injury, is to be attributed to the accident (see Lindeman Ltd v Colvin (30), per Dixon J; Migge v Wormald Bros. Industries Ltd. (31), per Mason J.A.; on appeal (32)), although medical negligence or inefficiency [whether by commission or omission] can be held to amount to a new cause of incapacity in some circumstances: Rothwell v Caverswall Stone Co. (33); Hogan v Bentinck Colleries (34). In the last-mentioned case Lord Reid, in dissent, expressed the opinion that there is a break in the chain of causation when a doctor is guilty of such negligence as would make him liable in damages. We think, with respect, that that test is too rigid. Some degree of medical negligence in the treatment of an injury may well be a reasonably foreseeable result of the act or omission by which that injury was inflicted, and then no clear line can be drawn to limit the original tortfeasor’s liability to exclude the consequences of the medical negligence.

However, in the ordinary case where efficient medical services are available to an injured plaintiff, the original injury does not carry the risk of medical treatment or advice that is ‘inexcusably bad’ (Martin v. Isbard (35)), or ‘completely outside the bounds of what any reputable medical practitioner might prescribe’ (Lawrie v Meggitt (36)), or ‘so obviously unnecessary or improper that it is in the nature of a gratuitous aggravation of the injury (South Australian Stevedoring Co. Ltd. V Holbertson [[1939] SASR] (37)) [‘Holbertson’] or ‘extravagant from the point of view of medical practice or hospital routine’: Hart and Honore, Causation in the Law (1959), p. 169. In such a case, it is proper to regard the exacerbation of a plaintiff’s condition as resulting solely from the grossly negligent medical treatment or advice, and the fact that the plaintiff acted reasonably in seeking and accepting the treatment or in following the advice will not make the original tortfeasor liable for that exacerbation.”

The High Court in Mahony had earlier stated (at 528) that for a novus actus interveniens to break the chain of causation, it must be possible to draw a line clearly before a liability, “that would not have occurred but for the wrongful act or omission of a tortfeasor and that is reasonably foreseeable by him, is treated as the result of a second tortfeasor’s negligence alone: See Chapman v Hearse (18).” The Court went on to say that whether such a line can and should be drawn is very much a matter of fact and degree. The Court said that where it is not possible to draw a clear line, the first tortfeasor may be liable in negligence for a subsequent injury and its consequences although the act or omission of another tortfeasor is the more immediate cause of that injury (528-529).

In its reference to Holbertson, the High Court in Mahony quoted the following statement made by the Full Supreme Court of South Australia, at 264, in which that Court attempted to illustrate how the distinction might be made:

“As a matter of commonsense we think that a mistake of this kind is a sequela of the injury. When a man gets his arm broken all that he can do is to get it set by a competent practitioner, and he has to take the risk of the doctor making a mistake. If the treatment is so obviously unnecessary or improper that it is in the nature of a gratuitous aggravation of the injury, it may be possible to find the cause of the incapacity without relating it back to the original injury, but in the case of slight negligence (the kind of mistake that anyone is likely to make, although it may have to be paid for), we think that it is impossible to say that the chain of causation is broken, or that the new act has given a fresh origin to the after consequences.”

While the Arbitrator correctly stated that “hindsight” was not the proper test (Vairy), there is ample evidence in this matter to suggest that the medical personnel at the Hospital should and would have been familiar with, and aware of, hyponatraemia and its symptoms at the time, by reason of knowledge, training and experience, and not simply or only with the benefit of hindsight. There is no doubt on the evidence in this matter, that Ms Griffey was displaying symptoms consistent with hyponatraemia (notwithstanding that other possibilities needed to be investigated, also). Professor Watson gave evidence that Hospital staff receive training about hyponatraemia, routinely. The symptoms to which reference is made, began to manifest about 3 May 2004 but appropriate testing was not carried out until 7 May 2004. Moreover, the conclusive results of the sodium test eventually conducted on that date were not acted upon for a further two days, because those results, as critical as they were, were not drawn to the attention of a doctor at that time. Professor Watson’s evidence before the Arbitrator lends weight to the necessity for the sodium test and the benefit of it, where he said at T 119, line 45 to T 120 line 5 of the transcript of proceedings before the Arbitrator, that the clinical syndrome had a broad set of explanations but that the single laboratory test “is in a very real sense diagnostic.” He said that the numerical results become diagnostic and focus on the problem. He went on to say, “So it is a case where the problem is clarified by the knowledge of essentially a single result.” This follows from his earlier acceptance that a timely diagnosis on 5 May 2004, could have resulted in the hyponatraemia, being much more easily corrected, as on that date signs and symptoms had emerged that were consistent with an hyponatraemic condition. While these are past events, consideration of them now does not support the proposition that they are being viewed with the benefit of hindsight, as they involve issues and matters that ought to have been properly considered and addressed at the time.

Professor Fisher opined that Ms Griffey’s brain damage was unrelated to the motor vehicle accident but was related to the development of severe hyponatraemia and its treatment at the Hospital. He noted that Ms Griffey’s management was unessentially different to what would normally be expected in a hospital. The Arbitrator summarises his opinion at [15] of her Reasons, thus:

“He suspected the most likely reason that she became hyponatreamic was that her water intake was excessive. In his opinion the treatment for the low sodium levels should have been earlier and levels raised more slowly because it is generally agreed that too rapid a correction may produce convulsions and brain damage particularly in young women. Professor Fisher stated it is generally accepted that sodium levels should not be elevated by more than 20-25 mmols/litre in 24 hours. Ms Griffey’s sodium levels were 91 mmols/litre at 11:40 on 9 May and 121 mmols/litre at 23; 45. Professor Fisher also stated that it is not possible to state categorically whether the instigation of treatment 2 days earlier would have prevented Ms Griffey from suffering the focal seizures and brain damage.”

Dr Dan, referred to earlier in these Reasons, considered that on the balance of probabilities, had Ms Griffey received treatment for the hyponaetremia on 7 May 2004, it would have prevented the focal seizures and the brain damage. Furthermore, Dr Dan said that he did not consider the brain damage to be directly attributable to the injury sustained in the motor vehicle accident. As observed by the Arbitrator at [16], Dr Dan considered that Ms Griffey’s neurological condition was not solely attributable to any treatment given or not given to her while in the Hospital, but that it was significantly related to the delay in treatment of her hyponaetramia. However, he opined that the treatment she received once commenced on 9 May 2004 was appropriate. He said that it was possible that the normal saline therapy contributed to the central pontine myclinolysis but at that stage, there was no reasonable alternative.

The reasonable conclusion from Dr Dan’s evidence is that the lack of alternatives confronting the Hospital in its treatment of Ms Griffey on 9 May 2004 was a result of the critical delay that had occurred between 7 and 9 May 2004.

Professor Watson, as noted by the Arbitrator at [34] of her Reasons, opined that if treatment had commenced on 7 May 2004 there could have been a better outcome. He said that there would have been a “real” chance of this, but perhaps not a “very good” chance. I note however, that Professor Fisher thought that such a proposition could not be stated categorically, but he did not dismiss it.

On the evidence it is clear that the Hospital concluded that it was left with no alternative as at 9 May 2004. It did not avail itself of the opportunity to consider its options on 7 May 2004 as, by reason of either systemic failure, or individual failure by its agents, it took no action at that time when the critical information came to hand. However, there is no doubt that urgent action of some kind would have been taken by the Hospital on 7 May 2004, had that failure not occurred.

The medical opinion as to whether aggressive treatment was the best option on 9 May 2004 is not entirely consistent. The issue is discussed by the Arbitrator at [36] of her Reasons. It seems that the weight of opinion is that the treatment should be administered slowly. I note in particular, the view expressed by Dr Watson that the rate of correction appeared to be too rapid. Nevertheless, he also states that there is no protocol regarding hyponatraemia and its management and, notwithstanding the existence of guidelines, it is largely a matter for judgment by “experienced clinicians”. There appears to be no indication why such a protocol is not established.

Significantly the Arbitrator concludes on the evidence at [42], “The medical consensus is that there was an omission with respect to the sodium level and there was an error in judgment with respect to the correction of the sodium level.” I agree with this finding.

With regard to the failure of the Hospital to act upon “the critical results recorded for 7 May tests” the Estate submits at [31] of its initial submissions on appeal:

“There is no doubt that the relevant Hospital staff should have been notified and then acted upon the critical results which were telephoned through to the ward at 11.45 hours on 8 May 2004. It is sufficient at this point to refer to the evidence of Dr Park at T. page 173/34 that the orthopaedic team should have followed up the results. There is, of course other evidence and we refer to this when we deal with the question of the degree of negligence involved in this failure.”

At [38] of the same submissions, the Estate submits in part:

“Results identified as ‘critical’ were telephoned through to the ward rather than communicated by slower means. The results were faithfully recorded in the notes. Apparently an enrolled nurse informed an agency nurse but the communication went no further as it should nor were the notes adequately reviewed at the shift changeover: see section 3 on page 5 of the RCA Report.”

The Hospital does not dispute that the results of the sodium test of 7 May 2004 were not acted upon promptly. However, it submits that Dr Watson’s opinion was not sought “in terms that Ms Griffey’s present vegetative state was attributable solely to a failure to respond to the sodium reading of 7 May 2004.” While that may be so, it does not disturb or displace the facts and evidence in this matter.

Summary and conclusions as to the break in the chain of causation

In summary, and without canvassing the detail of every error on the part of the Arbitrator, as alleged by the Council, I find that the evidence does support the Council’s position that there is a break in the chain of causation. The events and circumstances of phases one and two of the analysis in these Reasons demonstrate that the agents of the Hospital erred, essentially and for no other reason than that there were “other possibilities” for Ms Griffey’s symptoms, when they failed to include hyponatreamia in the list of those “possibilities”. This is so notwithstanding that it was legitimate for the Hospital to explore those other “possibilities”, but having regard to the knowledge, experience and training of its agents, and that the symptoms exhibited were consistent with hyponatreamia, a potentially debilitating and life threatening condition, no good reason is advanced as to why this possibility was not investigated, also. This error enabled the rapid development of the hyponatreamia over a period of 6 days, up to 7 May 2004, when the sodium test was eventually carried out by the Hospital.

The events and circumstances also reveal that critical test results of 7 May 2004, indicating that Ms Griffey was in a serious and obviously declining condition, were not acted upon until two days later, because the results of those tests were not brought to the attention of a doctor and not acted upon.

The medical evidence is sufficient and weighty enough to conclude that the delays over the whole period from about 3 May 2004 to 9 May 2004 led to the point where the Hospital’s agents had to exercise a judgment, leading to their decision that the Hospital was left with no option, other than to administer the aggressive treatment that resulted in Ms Griffey’s brain damage and persistent vegetative state. It is reasonably doubtful and far less likely, on the evidence, that such would have been the outcome had action been taken promptly on 7 May 2004. Furthermore, it is fairly much beyond doubt and quite unlikely that, had testing for hyponatraemia been carried out earlier still, as part of the investigation of the range of “possibilities”, this tragic outcome would not have occurred at all. As Professor Watson logically opines, the earlier that appropriate treatment is administered for hyponatraemia, the better the chances are of a good outcome. Professor Watson further explained at T 107 at lines 17-25, that a reason for the rapid increase in sodium levels was that too much was given too quickly. However he said that correction can be too rapid and can have a multiplicative effect. In those circumstances it cannot be controlled. He added that no matter how much caution is exerted, “in the initiation of that treatment I believe the events overtake you and this is what happened in this case.”

The significance of this is that these developments occurred not by reason of the Hospital’s treatment of Ms Griffey’s motor vehicle accident injuries, or even the onset of hyponatraemia in the first instance, but because the condition was allowed to develop to the extent that it did. It went undetected and untreated for a critical and inordinate period of time. Professor Fisher opines that the ultimate injury sustained by Ms Griffey did not arise from the motor vehicle accident but was caused by hyponatraemia and the way it was dealt with by the Hospital. Professor Watson suggests the possibility that there could have been some connection with the mild head injury suffered by Ms Griffey, but as the Estate concedes, Professor Watson relegated this possibility to the least potent of any cause of hyponatraemia. He said that the milder the head injury the less likely the connection. Ms Griffey’s head injury was, as the evidence indicates, mild. Dr Dan’s view is that Ms Griffey’s vegetative state is the result of the delay in providing appropriate treatment, and as a consequence, the necessity for the aggressive treatment administered from 9 May 2004.

On a consideration of the facts and the medical evidence in this matter, I conclude that the causal connection was broken by the intervention of these delaying factors, giving rise to the decision to treat Ms Griffey’s hyponatraemia aggressively, which in turn, caused her brain damage and persistent vegetative state. The “clear line” was emerging before 7 May 2004 and was finally “drawn” by reason of the overall delays culminating in the Hospital’s failure to act on that date, resulting in the new and devastating injury suffered by Ms Griffey from 9 May to 16 May 2004.

In this matter, it is not necessary to consider whether the aggressive treatment administered by the Hospital from 9 May 2004 was appropriate or not. The fact is that such treatment caused the brain damage and the vegetative state. That treatment was administered by the Hospital, which considered that it had no choice given the advanced state of Ms Griffey’s condition, which in turn, was the direct result of its own undue delays in detecting and dealing with the hyponatraemia. Those delays were solely caused by the acts and omissions of the Hospital. In effect, the delays set off a new chain of events. The relevant events and circumstances in the course of that new chain together, constituted the novus actus interveniens, as detailed above, in these Reasons. Once the preceding chain of causation is broken, the issue of causation for the purposes of workers compensation is resolved, and consideration of further or other liability beyond that point is not “incidental and necessary” for the exercise of the powers and jurisdiction conferred by statute upon the Commission. What occurred beyond that point, if it is a matter of contention between any of the parties, is a matter for different proceedings in another jurisdiction. I note again for the sake of completeness however, that the delay in providing treatment to Ms Griffey in a timely manner obviously led to the Hospital’s decision to administer the aggressive treatment, which resulted in Ms Griffey’s ultimate condition. The Hospital had placed itself in a position where it considered that it had no option other than to adopt this course. Had the delays not occurred, it is highly probable that such a decision, whether right or wrong, would not have been necessary, or made.

The Arbitrator noted correctly at [22] of her Reasons that the Hospital concedes a breach in in its duty of care to Ms Griffey. In their initial submissions on appeal, Ms Griffey’s legal representatives submit at [4], “The precise terms of the admission [in the matter pending before the Supreme Court] is ‘In answer to paragraph 9 of the Statement of Claim, the Defendant admits it breached its duty of care to the plaintiff.’ It is an admission of unspecified negligence… Caution has to be exercised in giving any evidentiary value to pleadings. They operate inter partes without any wider operation.” This submission is noted, and it is recognised that the proceedings in the Supreme Court relate to a claim for damages by Ms Griffey against the Hospital, and not for payment of workers compensation. It is the evidence and submissions made on the evidence before the Commission that are relied upon in this review. In this regard I note that the Hospital’s legal representatives made submissions to the Arbitrator in the proceedings before her, indicating that, while actual negligence has not been admitted, the Hospital has conceded a breach of duty.

The deficiencies leading to the catastrophic consequences for Ms Griffey are not confined to one isolated incident or error of judgment on the part of the Hospital, but in a series of events and circumstances over a period of days, culminating in the break in the chain of causation. While there is invariably a reasonable expectation of risk in undergoing medical treatment (Kooragang; March), expectation of risk is not without limit. There is a point beyond which the consequences of risk such as occurred in this case, cannot be contemplated and cannot reasonably be thought to be acceptable, in the circumstances. This is the all the more so when it is considered that any particular initial risk, the possibilities for what could develop, and the increasing risk that actually developed over the relevant period, would or should have been much more acute in the awareness of the trained Hospital medical staff at the time, than in the contemplation of Ms Griffey, her family and lay observers.

It seems to me that what occurred in the Hospital ultimately gave rise to “a new cause coming in disturbing the sequence of events” (The Oropesa) rather than a mere sequela of the injury that was sustained in the motor vehicle accident (Holbertson; Mahony), or a history of the “circumstances in which the cause operates” (Chennell). Having regard to the treatment given (including in particular the undue delays) and the circumstances in which it was given, the ultimate, devastating results of the treatment regime provided by the Hospital were so disproportionate to, and so disconnected from, the injury sustained in the motor vehicle accident, it cannot be concluded that the causal connection remained intact. The link in the chain of causation became so attenuated that, for legal purposes, the causative connection was snapped (Kooragang).

Aggressive treatment for severe hyponatraemia followed upon the deficiencies in the earlier course of treatment and care that led to the decision to proceed with measures considered necessary at that point in time, in order to preserve Ms Griffey’s life. There is no evidence to suggest that Ms Griffey was in any danger of death or severe brain damage when she was admitted to the Hospital for treatment, following the motor vehicle accident; nor could it be reasonably foreseen by Ms Griffey or her family, that treatment of her initial injuries would lead to such devastating results. It is recognised at law that it is reasonable to expect that things can and do go wrong in the course of medical treatment, for a variety of reasons, but having regard to the circumstances, the events, and the outcome in this matter, it must be regarded as an extreme case and the outcome well beyond any reasonable expectations or what might be foreseeable.

The question as to whether the incapacity suffered by Ms Griffey results from the impugned work injury in this matter is determined on the basis of the facts and evidence, including the medical opinion, in this matter (Kooragang; Vairy). This question is determined within the legal framework in which it arises (Chappell), that is, the statutory framework of the workers compensation jurisdiction. The novus actus in this matter effectively “replaced” the incapacity that resulted from the injury sustained in the motor vehicle accident, as it was a different and intervening cause (and injury) that ultimately produced a different incapacity (see The Oropesa; Bennett; Mahony, Kooragang; Bailey). It amounts to a new cause which has disturbed the sequence of events, and which can “be described as either unreasonable or extraneous or extrinsic” (Bennett). I find accordingly.

Acceptance of Liability by the Council

It is submitted by the Estate that Council in fact accepted liability and paid compensation to Ms Griffey. Similar submissions were made to the Arbitrator. The Arbitrator said at [46] of her Reasons:

“I note the submission by Ms Griffey’s representatives that the Council has accepted liability and paid compensation until September 2006, even after it considered that the chain of causation had been broken. It was suggested that this should be considered as an acceptance of total liability. It is clear from the correspondence that has been put before me that the Council intended to dispute liability and that it continued to make payments of compensation for compassionate reasons. I give little force to this submission.”

Having read the relevant documents on the Commission file, I agree with the Arbitrator.

Alleged negligence of the Hospital in its treatment of Ms Griffey

The factual situation with regard to this issue has been traversed already. There is no requirement to repeat what has been said to this point. I have found in favour of the Council in relation to the issue of causation and its submission that a novus actus interveniens was a cause of a different injury and incapacity from those sustained in the motor vehicle accident. As I have found against the Arbitrator’s decision that there was no break in the causal link, there is no necessity to deal with the proposition that she erred in not making an actual finding of negligence, allegedly consistent with associated statements made in her Reasons, in arriving at her decision on the issue of causation. I see no need to add anything further to what has already been said elsewhere in these Reasons, having regard to the statutory powers, functions and requirements of the Commission in the determination of liability or otherwise, for payment of workers compensation.

The existence or otherwise of a legal claim by the Hospital against the Council

Section 61(8) of the 1987 Act provides:

“Any amount for which an employer is liable under this Division in respect of medical or related treatment may be recovered from the employer by the person to gave the treatment.”

Section 62 (7) of the 1987 Act provides:

“A hospital, or a duly authorised officer of a hospital, may recover from the employer any amount for which the employer is liable under this Division in respect of hospital treatment given by that hospital.”

If the service provider of medical or related treatment to a worker is to have standing to recover the costs of the treatment under section 60 of the 1987 Act, the provider must establish that the recovery of such cost by service providers is a matter arising under the Act within the meaning of section 105 of the 1998 Act (Lloyd v Northern Rivers Charity Racing Assocation (1999) 18 NSWCCR 402 (‘Lloyd’)). See also Australian Brain Foundation Ltd v Hyteco (NSW) Pty Ltd NSWCA, BC200006583, 3 October 2000, 27 October 2000).

The Council and the Hospital have made submissions on this issue. The Estate has made no submissions on the matter. The Hospital agrees with the Council that there is “an element of discretion” in the sections. It submits in its initial submissions on appeal:

“74.Nevertheless, there are no good grounds as to why the Commission would have or should have exercised its discretion to decline recovery by the Hospital in circumstances where Ms Griffey is at present totally dependent and will require long-term personal care. That care to date has been provided by the Hospital. The Hospital’s ongoing care is not the subject of criticism.

75.Therefore, even in the circumstances where the words ‘may recover’ amount to a discretion which resides within the Commission to decline to grant recovery directly to the Hospital for Hospital treatment provided there is no good reason with the Arbitrator’s decision or otherwise as to why that discretion should not be exercised in the Hospital’s favour in the circumstances.”

Clearly, the circumstances outlined by the Hospital have radically changed by reason of Ms Griffey’s death. In any event, having regard to the findings and decision in these Reasons as to causation, this issue is far less significant than otherwise would have been the case.

For the provider to succeed it must establish the employer’s liability so that the cost of the services can be recovered from the employer, even if the liability has not been determined by way of judgment or admission (‘Lloyd’). Liability of the Council as asserted by the Hospital has been largely severed, along with the chain of causation. However, the Estate still has a residual claim against the Council for the injury sustained in the motor vehicle accident. This includes a claim for payment of expenses under section 60 of the 1987 Act, whatever that amount may be, arising from the injury occasioned in the motor vehicle accident, but not in relation to the further injury in the Hospital. Having regard to what has been put in the proceedings before the Arbitrator and before me, it is likely that Ms Griffey’s claim against the Council may settle, now that the issue of causation has been determined, and in light of Council’s admission of liability.

Council speculates that had action been taken by the Hospital against the Estate for recovery of its costs, such action would fail (see [225] of the Council’s initial submissions on appeal). It states further at [227]:

“The reason that the Hospital would not be able to succeed in any claim for the costs in question against Ms Griffey is that she would have a responsive claim in relation to the very same treatment which would operate to defeat and extinguish the claim by the Hospital by way of the doctrine of equitable set-off. A set-off is said to exist ‘when a defendant, in answer to a plaintiff’s claim, is able to plead successfully that a countervailing claim which he has against the plaintiff absolves him, wholly or partially, from liability to the plaintiff’: Meagher Gummow & Lehane’s Equity: Doctrines & Remedies (4^th Ed, 2002 at [37-005].”

The Council goes on to illustrate the point and further submits at [233]:

“The principles of equitable set-off would apply in relation to any claim made by the Hospital against Ms Griffey. The need (if such there was) for the great bulk of the hospitalisation has only arisen because of the negligence of the Hospital. But for that negligence Ms Griffey would have made a full recovery within a reasonably short period of time. The negligence by the Hospital arose in the course of providing the hospital services to Ms Griffey pursuant to the contract between them. There is thus a direct relationship between any liability of Ms Griffey to the Hospital on the one hand, which would arise from the contract between them, and any liability of the Hospital to Ms Griffey, which arose out of its negligent performance of the contract. This is certainly an instance where the party entitled to the equitable set-off would be able to show ‘some equitable ground for being protected against his adversary’s demand’.”

At [236] Council submits:

“This argument does no harm to the interests of Ms Griffey. On the contrary, it recognises that Ms Griffey has a proper claim against the Hospital for its admitted negligence. And, reflecting that fact, the argument simply recognises that the Hospital would not be able to claim the costs of the treatment directly from her. That being so, nor can the Hospital claim those costs from the City.”

The parties have informed the Commission that there is an action pending in the Supreme Court, instituted by Ms Griffey against the Hospital. That matter has not yet been determined. The Commission has also been informed that other proceedings are pending in the Supreme Court, arising out of the circumstances of this matter. None of these proceedings relates to claims for payments pursuant to the workers compensation legislation.

While the issue between the Hospital and the Council is much less significant, because of the findings and decision as to causation, and in light of Council’s admission of liability for injury sustained in the motor vehicle accident alone, no equitable set-off, if indeed it is available in this jurisdiction, is available in this matter because the legal rights and liabilities between the Estate and the Hospital have not yet been determined (and no award of damages has been made). In particular, while there is evidence of “damage”, the issues of the Hospital’s legal liability for negligence and for any “damages” that may be awarded as compensation remain unresolved at this point in time (see Dillingham Constructions Pty Ltd v Steel Mains Pty Ltd (1975) 132 CLR 323). It is reasonable to anticipate that the question of the Estate’s liability to pay the Hospital expenses, other than those payable pursuant to the workers compensation legislation, will be caught up and determined in the proceedings in the Supreme Court.

This issue requires no further consideration, given the finding that there was a break in the chain of causation, and a new cause of a different and non-work related injury and impairment emerged from what occurred in the Hospital. The Hospital’s claim against the Council for recovery of the costs of its services to Ms Griffey largely fails, except for the services that relate to the initial treatment and care provided to her in relation to the motor vehicle accident alone. As outlined above, the circumstances in which the Hospital brought its claim directly against the Council have largely disappeared. This is reflected in the formal orders made following the determination of these appeals.

The Council has accepted liability under the workers compensation legislation, for the injury sustained in the motor vehicle accident only, and it is now open to it to proceed on that basis in meeting its obligations to the Estate, under the Workers Compensation legislation.

The alleged failure of the Arbitrator to exercise her discretion to decline the Hospital’s claim

This issue now requires no consideration and determination.

The alleged failure of the Arbitrator to make the correct and preferable decision

Given that the Council has substantially succeeded in its appeal following a review of the Arbitrator’s decision and the evidence and the submissions made, and in light of findings made elsewhere in these Reasons, there is no necessity to consider this issue further.

The correctness or otherwise of the Arbitrator’s findings and awards pursuant to sections 66 and 67 of the 1987 Act

The second appeal brought by the Council is specifically made against the decision of the Arbitrator dated 12 March 2008 awarding payment to Ms Griffey pursuant to sections 66 and 67 of the 1987 Act.

Having regard to the findings in this matter as to causation, the break in the chain of causation by reason of a novus actus interveniens, and no evidence to suggest that the permanent impairment or pain and suffering sustained by Ms Griffey arose out of the injury suffered in the motor vehicle accident, the appeal must succeed.

CONCLUSION

Both appeals are successful.

In my view, the order pursuant to section 60 of the 1987 Act should be made in favour of the Estate, but only insofar as it applies to treatment made necessary by the injury sustained in the motor vehicle accident, alone. The precise details will need to be settled between the parties. Given the significant change in circumstances by reason of Ms Griffey’s death and the findings as to causation in these appeals, I do not consider that it is necessarily appropriate that a specific order/award should be made in favour of the Hospital pursuant to sections 61(8) and 62(7) of the 1987 Act.

The award of weekly benefits payable from 15 September 2006, made on 24 December 2007, no longer applies, having regard to the finding as to causation in this matter. I note that the Council paid weekly benefits to Ms Griffey for compassionate reasons up to that date.

The Arbitrator’s certification and order dated 12 March 2008, as to the complexity in both appeals, for the purposes of Item 4 Table 4 Schedule 6 of the Workers Compensation Regulation 2003, is to stand.

DECISION

The appeal in this matter, Council of the City of Sydney v Estate of Belinda Jane Griffey and Anor (No 1) [2008] NSWWCCPD 114 is successful. The decision of the Arbitrator dated 24 December 2007 is revoked and the following decision is made in its place:

The Council is to pay to the Estate, Ms Griffey’s reasonably necessary expenses pursuant to section 60 of the Workers Compensation Act 1987, in relation to the work-related injury sustained in the motor vehicle accident only, upon production of accounts and/or receipts.

The Appeal in Council of the City of Sydney v Estate of Belinda Jane Griffey and Anor (No 2) [2008] NSWWCCPD 115 is successful. Paragraphs (i) and (ii) of the Arbitrator’s decision dated 12 March 2008 are revoked, however paragraph (iii) is confirmed.

COSTS

The Hospital, being the Second Respondent, is to pay the Council’s costs of this appeal.

No further order is made as to costs.

Gary Byron
Deputy President
15 October 2008

I, MARIE JOHNS CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF DEPUTY PRESIDENT GARY BYRON, OF THE WORKERS COMPENSATION COMMISSION.

ASSOCIATE