Cross v Secretary, Department of Education - [2019] NSWWCCPD 20

DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:	Cross v Secretary, Department of Education [2019] NSWWCCPD 20
APPELLANT:	Joanne Cross
RESPONDENT:	Secretary, Department of Education
INSURER:	Allianz Australia Ltd as agent for the NSW Self Insurance Corporation
FILE NUMBER:	A1-2605/18
ARBITRATOR:	Mr B Batchelor
DATE OF ARBITRATOR’S DECISION:	9 November 2018
DATE OF APPEAL DECISION:	14 May 2019
SUBJECT MATTER OF DECISION:	Sections 48 and 48A of the Workplace Injury Management and Workers Compensation Act 1998
PRESIDENTIAL MEMBER:	Deputy President Michael Snell
HEARING:	On the papers
REPRESENTATION:	Appellant:	Carroll & O’Dea Lawyers
Respondent:	Hunt & Hunt
ORDERS MADE ON APPEAL:	1. The identity of the respondent is amended to “Secretary, Department of Education”. 2. The Arbitrator’s decision dated 9 November 2018, other than to the extent to which it is expressly confirmed by these reasons, is revoked. 3. In substitution, there is a finding that the respondent’s defence pursuant to sections 48 and 48A of the Workplace Injury Management and Workers Compensation Act 1998 fails, and that the appellant is entitled to weekly payments of compensation consistent with the work capacity decision dated 24 August 2015, for the remainder of the second entitlement period. 4. The matter is remitted to the same Arbitrator, to make orders for weekly payments consistent with these reasons, and any associated orders, such as necessary orders for the payment of expenses pursuant to s 60 of the Workers Compensation Act 1987, beyond those previously made.

INTRODUCTION AND BACKGROUND

Joanne Cross (the appellant) suffered injuries in the course of her employment as an administrative officer at Orange High School. For the purposes of these proceedings, the respondent is the “Secretary, Department of Education”[1] (the respondent). On 13 August 2014 the appellant tripped over the electrical cord of a bar heater located near her work space. She was off work for one to two weeks, and resumed on lighter duties. On 2 February 2015 (it is also described as occurring on 6 February 2015, nothing turns on the date), the appellant was injured at work when she pulled on a bed in the school’s first aid room, which she was tidying. Injury to the lumbar spine and the left shoulder are pleaded, although the lumbar spine complaints are not of any real moment to the issues in the matter. The appellant was off work for various times, for which compensation was paid voluntarily. She underwent surgery to the left shoulder at the hands of Dr Kwa, an orthopaedic surgeon, on 30 July 2015. She did not resume work thereafter.[2] On 16 August 2015 the appellant moved to live in Melbourne with her fiancé, who she married on 21 November 2015. She sold her home in Orange.[3] The appellant developed adhesive capsulitis of the shoulder.[4]
[1] Government Sector Employment Act2013, s 26(1) and Pt 1 of Sch 1, Kelly v Secretary, Department of Family and Community Services [2014] NSWCA 102, 13 DDCR 111, [11].
[2] Appellant’s statement dated 15 May 2018, Application to Resolve a Dispute (ARD), pp 213–4.
[3] Appellant’s statement dated 29 August 2018, [3], [15], Application to Admit Late Documents (AALD) 29.8.18, pp 1–2.
[4] Dr Kwa’s report 20 October 2015, Reply, pp 12–13.
The appellant stated that, from before she moved to Melbourne, it was “common knowledge” at Orange High School that she intended doing so.[5] On about 10 November 2015 a claims manager with Allianz (the relevant insurer at that time) contacted the appellant and informed her that she should commence suitable duties at Orange High School from 16 November 2015. The appellant said she could not, as she had no accommodation.[6] The respondent issued a document headed “Return to Work Plan Number 3” (RTW 3) dated 22 February 2016.[7] It provided that the appellant was to perform “suitable duties for 6 hours and 15 minutes per day, 5 days per week”, at Orange High School. The insurer wrote to the appellant on 3 March 2016 stating that she had “failed to comply with the obligations set out in [her] Injury Management Plan”. It stated that if she wished to continue to receive weekly benefits, she needed to supply the insurer with evidence that she had returned on suitable duties as per RTW 3. On 27 April 2016 the insurer gave the appellant notice that it had terminated her weekly payments. The stated reason was her failure to return to suitable duties in accordance with RTW 3.
[5] Appellant’s statement dated 29 August 2018, AALD 29.8.18, pp 1–4.
[6] AALD 21.9.18, pp 17–18.
[7] AALD 21.9.18, pp 95–99.
In Melbourne the appellant came under the care of another orthopaedic surgeon, Dr Nguyen, who recommended further surgery involving a “left shoulder arthroscopic capsular release”.[8] The insurer obtained a report from an orthopaedic surgeon, Dr Hitchen, dated 22 September 2016, following a file review (he did not examine the appellant).[9] The insurer declined liability for this surgery on 26 September 2016.[10]
[8] ARD, p 88.
[9] Reply, pp 1–3.
[10] Reply, pp 167–169.
In these proceedings, the appellant sought continuing weekly payments from 27 March 2016,[11] and medical expenses including the cost of the proposed surgery by Dr Nguyen.
[11] Transcript 2 November 2018, T 3.14–15.
The Commission referred the matter to an Approved Medical Specialist (AMS), Dr Machart, for a general medical dispute. The AMS examined the appellant on 7 August 2018, and the Medical Assessment Certificate (MAC) was dated 23 August 2018. The AMS described the condition of a frozen shoulder as “related to the 2 injuries outlined”, and said “arthroscopy and surgical release of adhesions is valid and appropriate treatment for frozen shoulder”. The Arbitrator made consent orders on 7 September 2018, following a telephone conference. He ordered the payment of the outstanding medical expenses of $3,188.21, and made a consent finding that the proposed surgery was reasonably necessary as a result of the pleaded injuries.
This left the issue of the weekly entitlement, which was listed for arbitration hearing on 2 November 2018. Mr Harrington appeared for the appellant, and Mr Saul for the respondent. There was no oral evidence. Counsel for both parties addressed, and the Arbitrator reserved his decision. A Certificate of Determination was issued by the Commission dated 9 November 2018, accompanied by ten pages of reasons.[12] There was an award in favour of the respondent. This appeal is brought against that decision.
[12] Cross v Department of Education and Training [2018] NSWWCC 275 (reasons).

THE ARBITRATOR’S DECISION

The Arbitrator noted that the principal injury was to the left shoulder, and the respondent defended the weekly claim on the basis of ss 48 and 48A of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act). He succinctly summarised the parties’ positions:
“6. The respondent opposes the [appellant’s] claim for weekly benefits, relying on sections 48 and 48A of the 1998 Act. It says that, at the time to which weekly benefits were paid, the [appellant] did not make reasonable efforts to return to work in suitable employment at her place of employment at Orange High School.
7. In answer to this, the [appellant] essentially contends that it was not reasonable for her to return to work in Orange, New South Wales, when the respondent was well aware that she had moved to live in Victoria, and had signalled her intention to do so before the date of the first accident on the 13 August 2014.”[13]
[13] Reasons, [6]–[7].
The Arbitrator noted there were additional issues. Did the appellant have a current work capacity during the period of the claim? Was the potential period of weekly entitlement doubled, because there were two injuries?[14]
[14] Reasons, [8].
The Arbitrator summarised the parties’ submissions.
The Arbitrator concluded the appellant had suffered a single injury (viewed as a single pathology). Her period of weekly entitlement was not doubled because there had been two incidents.[15]
[15] Reasons, [33]–[38].
The Arbitrator then turned to the defence pursuant to s 48A. He identified RTW 3 as containing the relevant injury management plan.[16] He referred to the various warnings sent to the appellant, and said there was no suggestion that the insurer had not complied with the procedural requirements for warning the appellant of the suspension and termination of her weekly payments.[17] He noted the appellant’s evidence that she had given notice to various claims officers of the respondent’s insurer (who she named) of her move to Melbourne, and each had told her that there would be no problem. The appellant said she understood that her payments, medical care and job seeking support (when she was fit for some work) would continue in Melbourne. She said she kept David Lloyd (the principal of Orange High School) updated regarding her recovery.[18] Ms Paag (a rehabilitation consultant appointed by the insurer) was aware the appellant was seeking to have Dr Patel (in Doncaster, Victoria) as her treating doctor, and that suitable employment was likely to be sought in Melbourne. Mr Lloyd was informed by the appellant that her original plan was, when she was fully fit and this situation was resolved, to obtain a position at a school in Victoria, although she would be prepared to return to Orange High School until she was successful in Victoria.[19]
[16] Reasons, [39]–[40].
[17] Reasons, [41]–[44].
[18] Reasons, [46]–[47].
[19] Reasons, [49].
The Arbitrator referred to an email from the appellant to Dimity Giacca at Allianz, dated 15 November 2015. It stated that Dr Patel (who was the nominated treating doctor from about 2 November 2015) would not endorse a return to work in Orange, but that from 17 November 2015, the appellant was available for light duties in Melbourne. She said she would not be at Orange High School for work that morning.[20]
[20] Reasons, [50].
The Arbitrator rejected the appellant’s argument that she was totally incapacitated. At the time the respondent was issuing notices to the appellant, from 3 March 2016, the appellant had been certified fit for modified duties. Dr Kossmann (on whom the appellant relied in making this argument) did not support it. What the doctor said was that the appellant had no capacity to return to her former employment.
The appellant had previously indicated to Mr Lloyd that when she was fit she would be prepared to travel to Orange to resume work, until she succeeded in getting a position in Victoria. She had indicated it may be difficult to find such work, given that she was not fully fit, to be attractive to a prospective employer. The Arbitrator considered the respondent was not acting unreasonably in offering suitable employment in Orange in the circumstances. The appellant indicated to the respondent on 13 November 2015 that she would not be commencing selected duties on that date. However, she could have complied with the request at some time prior to 24 March 2016 and the suspension would not have occurred.[21]
[21] Reasons, [51].
The Arbitrator noted that the definition of ‘suitable employment’ in s 32A of the Workers Compensation Act 1987 (the 1987 Act) specifically provides that its satisfaction is to be regardless of a worker’s pre-injury employment and place of residence. The Arbitrator accepted the respondent’s submission that the appellant’s move to Melbourne should be ignored, in considering her fitness for suitable employment. He said “the legislation is quite clear and specific, and not beneficial to the [appellant]”. He concluded:
“In my view, having regard to all of the evidence, the [appellant] has not in co-operation with the respondent or the insurer made it [sic] reasonable efforts to return to work in suitable employment at Orange High School. There is no evidence that she made such efforts at another place of employment. Further, I do not find that the [appellant] is to be treated as making a reasonable effort to return to work in suitable employment or pre-injury employment during any reasonable period for the reasons set out in section 48(2) of the 1998 Act.”[22]
[22] Reasons, [53]–[54].
The Arbitrator dealt with a submission that the legislation was beneficial. He referred to ADCO Constructions Pty Ltd v Goudappel.[23] He said:
“Similarly, sections 48-49 of the 1998 Act, which were also introduced into that Act by the 2012 amendment Act, are clearly not beneficial. There is no constructional choice that would enable section 48 to be interpreted so as to avoid its application to the applicant’s entitlement in this case.”
[23] [2014] HCA 18; 254 CLR 1 (Goudappel), [29]–[30].
The Arbitrator concluded that the respondent was “entitled to rely on section 48 of the 1998 Act in its defence of the [appellant’s] claim for weekly benefits”. There was an award in favour of the respondent on the weekly claim.

ON THE PAPERS

Section 354(6) of 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.”
Having regard to Practice Directions Nos 1 and 6; the documents that are before me, and the submissions by both parties that the appeal can proceed to be determined on the basis of these documents, I am satisfied that I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that this is the appropriate course in the circumstances.

THRESHOLD MATTERS

There is no dispute between the parties that the threshold requirements as to quantum and time pursuant to ss 352(3) and 352(4) of the 1998 Act have been met.

GROUNDS OF APPEAL

The appellant raises the following grounds:
(a) the Arbitrator erred in failing to apply correct statutory construction of ss 48 and 48A of the 1998 Act (Ground No 1);
(b)    the Arbitrator erred in his assessment as to whether the appellant had made ‘reasonable’ attempts to return to suitable duties (Ground No 2);
(c) the Arbitrator failed to consider the discretionary requirements of a decision of an insurer under s 48A (Ground No 3);
(d)    the Arbitrator failed to consider the consequences of the assurances given by five of the insurer’s claims officers of continuing entitlement to compensation upon the appellant’s move to Melbourne, prior to the suspension of weekly payments by the insurer (Ground No 4);
(e) the Arbitrator erred in the discretionary elements of his judgment (Ground No 5), and
(f)    the Arbitrator failed to give adequate reasons for his decision (Ground No 6).

LEGISLATION

Section 3 of the 1998 Act provides:
“System objectives
The purpose of this Act is to establish a workplace injury management and workers compensation system with the following objectives:
(a)     to assist in securing the health, safety and welfare of workers and in particular preventing work-related injury,
(b)     to provide:
•prompt treatment of injuries, and
•effective and proactive management of injuries, and
•necessary medical and vocational rehabilitation following injuries,
in order to assist injured workers and to promote their return to work as soon as possible,
(c)     to provide injured workers and their dependants with income support during incapacity, payment for permanent impairment or death, and payment for reasonable treatment and other related expenses,
(d)     to be fair, affordable, and financially viable,
(e)     to ensure contributions by employers are commensurate with the risks faced, taking into account strategies and performance in injury prevention, injury management, and return to work,
(f)     to deliver the above objectives efficiently and effectively.”
Section 41(1) of the 1998 Act sets out the object of Ch 3 of the 1998 Act, of which ss 48 and 48A are part:
“(1) The object of this Chapter is to establish a system that seeks to achieve optimum results in terms of the timely, safe and durable return to work for workers following workplace injuries.”
Section 48 of the 1998 Act provides:
“48 Return to work obligations of worker
(1) A worker who has current work capacity must, in co-operation with the employer or insurer, make reasonable efforts to return to work in suitable employment or pre-injury employment at the worker’s place of employment or at another place of employment.
(2) For the purposes of this section, a worker is to be treated as making a reasonable effort to return to work in suitable employment or pre-injury employment during any reasonable period in which:
(a)the worker is waiting for the commencement of a workplace rehabilitation service that is required to be provided under an injury management plan for the worker, or
(b)the worker is waiting for a response to a request for suitable employment or pre-injury employment made by the worker and received by the employer, or
(c)if the employer’s response is that suitable employment or pre-injury employment will be provided at some time, the worker is waiting for suitable employment or pre-injury employment to commence.”
Section 48A of the 1998 Act provides:
“48A Failure to comply with return to work obligations of worker
(1) If a worker does not comply with an obligation of the worker imposed under section 48, the insurer may in accordance with this section:
(a)suspend the payment of compensation in the form of weekly payments to the worker, or
(b)terminate the payment of compensation in the form of weekly payments to the worker, or
(c)cease and determine the entitlement of the worker to compensation in the form of weekly payments in respect of the injury under this Act.
(2)     If the insurer seeks to suspend payments of compensation under subsection (1)(a), the insurer must give written notice to the worker stating:
(a)the reason for the giving of the notice, and
(b)that unless the worker complies with the obligation under section 48 specified in the notice, weekly payments to the worker will be suspended from the date specified in the notice which must be a date at least 14 days after notice is given but no more than 60 days after notice is given, and
(c)the consequences of failing to comply as specified in the notice.
(3)     If the worker fails to comply with a written notice under subsection (2), the insurer may suspend the payment of weekly payments to the worker for a period of 28 days after the date specified in the notice referred to in subsection (2)(b).
(4)     If the worker complies with the obligation specified in the notice under subsection (2) during the period that weekly payments are suspended under subsection (3), the insurer must, subject to and in accordance with this Act, resume the payment of weekly payments with effect from the date on which the worker complied with the obligation.
(5)     If subsection (4) applies, the worker forfeits any compensation in the form of weekly payments that would otherwise have been made during the period of suspension until the worker complied with the obligation and that period is included in determining the first or second entitlement period under Division 2 of Part 3 of the 1987 Act.
(6)     If the worker does not comply with the obligation specified in the notice under subsection (2) for the entire period that weekly payments are suspended under subsection (3), the insurer may terminate the payment of compensation in the form of weekly payments to the worker in respect of the injury by written notice stating the reasons for giving the notice.
(7)     If the worker:
(a)does not comply with the obligation specified in the notice under subsection (2) for the entire period that weekly payments are suspended under subsection (3), and
(b)has within the last 12 months prior to the giving of the notice referred to in paragraph (a):
(i)been issued 2 notices under subsection (2) without a subsequent suspension of weekly payments, or
(ii)had compensation in the form of weekly payments suspended once under subsection (3),
the insurer may cease and determine the entitlement to compensation in the form of weekly payments in respect of the injury to the worker under this Act by written notice stating the reasons for giving the notice.”

The definition of ‘suitable employment’ in s 32A of the 1987 Act provides:
“suitable employment, in relation to a worker, means employment in work for which the worker is currently suited:
(a) having regard to:
(i)the nature of the worker’s incapacity and the details provided in medical information including, but not limited to, any certificate of capacity supplied by the worker (under section 44B), and
(ii)the worker’s age, education, skills and work experience, and
(iii)any plan or document prepared as part of the return to work planning process, including an injury management plan under Chapter 3 of the 1998 Act, and
(iv)any occupational rehabilitation services that are being, or have been, provided to or for the worker, and
(v)such other matters as the Workers Compensation Guidelines may specify, and
(b) regardless of:
(i)whether the work or the employment is available, and
(ii)whether the work or the employment is of a type or nature that is generally available in the employment market, and
(iii)the nature of the worker’s pre-injury employment, and
(iv)the worker’s place of residence.”

THE APPLICATIONS TO ADMIT FURTHER EVIDENCE

Ultimately, applications were made by both parties for the admission of further evidence pursuant to s 352(6) of the 1998 Act, which provides:
“Evidence that is fresh evidence or evidence in addition to or in substitution for the evidence received in relation to the decision appealed against may not be given on an appeal to the Commission except with the leave of the Commission. The Commission is not to grant leave unless satisfied that the evidence concerned was not available to the party, and could not reasonably have been obtained by the party, before the proceedings concerned or that failure to grant leave would cause substantial injustice in the case.”
The operation of the provision was explained in CHEP Australia Limited v Strickland:
“27. In the s 352(6) context, there are two threshold questions. They arise as alternatives and are set out in the second sentence of the provision. The first goes to the issue of availability in advance of the proceedings. The second entails an assessment of whether continued unavailability of the evidence ‘would cause substantial injustice in the case’. The discretion to admit becomes available to be exercised only if the Commission is satisfied as to one of the threshold matters.”
“31. The part of s 352(6) concerning ‘substantial injustice’ does not direct attention to possibilities or potential outcomes. The task is to decide whether absence of the evidence ‘would cause’ substantial injustice in the case. There must therefore be a decision as to the result that ‘would’ emerge if the evidence were taken into account and the result that ‘would’ emerge if it were not. If the result would be the same on each hypothesis, the ends of justice cannot be said to have been defeated by exclusion.”[24]
[24] [2013] NSWCA 351; 12 DDCR 501, [27], [31] (per Barrett JA, Macfarlan JA agreeing).
The appellant, in her further submissions lodged in response to a Direction (see [40] below) seeks to rely on further documentary evidence, which is attached to her further submissions. She submits these documents are from the insurer’s file, are relevant, and that there is no prejudice associated with their use. The first document is an application to the insurer to change her nominated treating doctor, dated 2 November 2015. The second is an Injury Management Plan dated 22 December 2015, signed by the appellant, her nominated treating doctor and a case manager.
The respondent was requested by the Commission, in an email dated 15 April 2019, to “advise within 48 hours (with short submissions if necessary) what attitude it takes to the appellant’s application to rely on additional evidence”. The respondent responded on 17 April 2019. It stated that the Injury Management Plan dated 22 December 2015, which the appellant sought to rely on as additional evidence, was amended by the appellant in her own hand, and returned to the insurer on 29 December 2015. The respondent stated that on 30 December 2015, the insurer issued and served an amended Injury Management Plan, “with the amendments of the appellant and additional relevant information”. The respondent stated it did not object to the appellant relying on the application to the insurer to change her nominated treating doctor, dated 2 November 2015. It did not object to the appellant relying on the Injury Management Plan dated 22 December 2015, providing the respondent could tender the plan dated 30 December 2015; it submitted “both documents go to the issue of the state of the injured worker’s knowledge”.
For reasons given below, I am of the view that the issue of whether the appellant made ‘reasonable efforts’ to return to work, within the meaning of ss 48 and 48A of the 1998 Act, was sufficiently raised before the Arbitrator. The Direction dated 25 March 2019 sought further submissions on specific subject matter, being certain authorities that were arguably relevant to that issue. The documents on which the appellant now seeks to rely are potentially relevant to the application of those authorities. Be that as it may, it is necessary that one of the threshold questions be satisfied, before the discretion is enlivened. Neither party has asserted, nor is there evidence, that any of these documents were not available to be used at the arbitration hearing. The first threshold question cannot be satisfied. Neither party has submitted that the result in the matter will be a different one, depending on whether one or more of these documents are admitted as further evidence. The application by the appellant to change her nominated treating doctor, dated 2 November 2016, is already in evidence.[25] The copies of the Injury Management Plan, the subject of the applications, were not the operative plans at the time of the alleged failure by the appellant, relied on in the insurer’s notice pursuant to s 48(2) (see [93] below). It is not apparent how the further evidence would change the result. In the circumstances, neither of the threshold questions is satisfied, and the discretion to admit the material is not enlivened. The applications by both parties are rejected.

GROUND NO 2 – REASONABLENESS

GROUND NO 4 – THE ASSURANCES OF CLAIMS OFFICERS

[25] AALD 21.9.18, p 9.

GROUND NO 6 – FAILURE TO GIVE ADEQUATE REASONS

It is convenient to deal initially with Ground No 2. There is some overlap between Ground No 2, and Grounds Nos 4 and 6. In dealing with Ground No 4 in this context, I do not deal with the ‘waiver’ argument raised in the appellant’s submissions. The parties’ submissions do not separately address Ground No 6. That ground is obliquely relevant, although not essential, to the way in which I deal with Ground No. 2. It is convenient to deal with these grounds together.

Appellant’s submissions

The application of s 48A of the 1998 Act depends on the appellant being in breach of her obligations under s 48. The appellant submits the evidence overwhelmingly favoured the conclusion that she made reasonable efforts to return to work, notwithstanding that she could not return to her place of employment at Orange. The medical evidence established that she was significantly incapacitated. Reference is made to the reports of Dr Kossmann, Dr Kwa and Dr Nguyen, and the certificates from the general practice attended by the appellant. Dr Nguyen, in August 2016, sought approval to carry out surgery involving arthroscopic capsular release of the left shoulder. The MAC of Dr Machart dated 23 August 2018 confirmed this surgery was valid and appropriate treatment. The insurer declined to pay for the treatment, until finally agreeing at a telephone conference on 5 September 2018.[26]
[26] Appellant’s submissions, [14]–[15].
The appellant was awaiting authorisation of the proposed surgery, by the insurer, from at least August 2016. If she had a capacity for employment, it would be for work “requiring the use of only one arm”, she would require breaks, analgesia, and would not be able to drive to work. From a practical point of view, she was totally incapacitated for work.
The appellant submits that she was not “recalcitrant in respect of her obligations to return to suitable employment”. The appellant said that she had been reassured by five claims officers of the insurer that there would be “no problems” transferring her case to Melbourne. She had sold her house in Orange and moved to Melbourne as she had formed a new relationship. The insurer agreed to a change of the appellant’s general practitioner, to one in Melbourne. The appellant had a reasonable perception that she would continue to receive compensation benefits when she moved. She was prepared to ‘job seek’ in Melbourne. The appellant submits the broad term ‘reasonable’ in s 48(1) of the 1998 Act is not limited by the provisions of s 48(2). The appellant submits she was co-operating with the insurer, making reasonable efforts to return to work in suitable employment. The Arbitrator, dealing with whether the appellant had made “reasonable efforts to return to work” considered only one factor, failure to comply with the injury management plan.[27]
[27] Appellant’s submissions, [16]–[23].
The Arbitrator said there was no evidence that the appellant had made reasonable efforts to return to suitable work at another place of employment. The appellant submits this was an “unfair summary of the evidence”. The appellant “clearly had very little residual earning capacity”. To obtain suitable employment she would have required assistance that could be provided by the insurer. The uncontradicted evidence was that at all times she “was attempting to cooperate with the insurer in job seeking in Melbourne”. In the reasons at [51] the Arbitrator said that the respondent did not act “unreasonably in offering the [appellant] suitable employment in Orange”. The appellant submits this misstates the test. The issue is not whether the respondent acted unreasonably, but whether the appellant made reasonable efforts to return to work in suitable employment.[28]
[28] Appellant’s submissions, [33]–[34].

Respondent’s submissions

The respondent submits the appellant’s ground of appeal and submissions, going to ‘reasonableness’, were matters not raised at first instance, and should not be permitted on appeal.[29]
[29] Respondent’s submissions, [3], [20].
The respondent submits that the statutory obligation on a worker, to make “reasonable efforts to return to work”, is “clearly defined in s 48(2)” of the 1998 Act. The Arbitrator correctly found that the appellant “did not satisfy any of the definitions of ‘reasonable efforts’ as set out in s 48(2)(a) to (c)”. The respondent also states that it relies on its submissions at first instance.
The appellant in reply submits that the issue was raised at first instance, and was raised by the Arbitrator.[30]
[30] Appellant’s submissions in reply, [2].

Submissions in response to a Direction

The Commission issued a Direction to the parties dated 25 March 2019, in the following terms:
“1. The attention of the parties is drawn to certain authorities which deal with provisions in workers compensation legislation relating to ‘unreasonable’ conduct or action by a worker. (See Fazlic v Milingimbi Community Inc [1982] HCA 3; 150 CLR 345 [Fazlic], Freightcorp v Duncan [2000] NSWCA 309 [Duncan], O’Carroll Constructions Pty Ltd v Burgess [2007] NSWWCCPD 224 [Burgess], McDonald v North Coast Area Health Service [2009] NSWWCCPD 50 [McDonald], Rail Corporation of New South Wales v B [2009] NSWWCCPD 81 [B].)
2. The parties are directed, by 4 pm on Friday 12 April 2019, to lodge and serve written submissions directed to the application of these authorities to the current matter.”
Both parties lodged further submissions in response to this Direction on 9 April 2019.

Appellant’s further submissions

The appellant submits it is not unusual, in workers compensation legislation, for the same words to be interpreted differently in different provisions. By way of example, reference is made to the definition of ‘injury’, which “can mean pathology or event (and sometimes both)”. Reference is made to Central West Group Apprentices Ltd v Barrett.[31] The appellant submits the implications of the term ‘suitable employment’ are “vastly different” for the purposes of Div 2 of the 1987 Act, as opposed to s 48 of the 1998 Act. The former involves identification of ‘suitable employment’ which is often theoretical, a worker does not have an obligation to perform it, and an employer does not have an obligation to provide it. It varies a worker’s entitlement to weekly payments.[32]
[31] [2008] NSWWCCPD 137.
[32] Appellant’s further submissions, [2]–[4].
The appellant submits that ‘suitable employment’ for the purposes of s 48 of the 1998 Act involves reference to the indicia in subcll (a)(i) to (iv) of the definition in s 32A. The matters set out in subcl (b) of the definition “clearly have no part to play in the assessment of whether or not the employer has provided suitable employment”. If it were otherwise, a state-wide employer (such as the current respondent) could offer employment “thousands of miles away” from an injured worker’s residence, and this would constitute ‘suitable employment’.[33] Contrary to the approach of the Arbitrator, the circumstances of the appellant’s “moves” should have been considered in determining ‘reasonableness’. Geographical relocation “for legitimate family reasons, and the behaviour of the respondent prior to that move, were matters that were of paramount importance and should have been taken into account”. It should have been found that the appellant “had made reasonable efforts to return to ‘suitable employment’.”[34]
[33] Appellant’s further submissions, [5]–[6].
[34] Appellant’s further submissions, [5]–[9].
The appellant submits the respondent carried the onus of proof, in invoking ss 48 and 48A, a disentitling provision, citing B.[35] The appellant submits the restrictions on the appellant’s working capacity were “so close to total incapacity” that the respondent failed to discharge its onus of establishing the duties were ‘suitable employment’.[36]
[35] B, [53].
[36] Appellant’s further submissions, [10]–[13].
The appellant submits that ss 40(1) and 40(2A) of the 1987 Act were repealed and replaced by ss 48, 48A and 49 of the 1998 Act. The repealed sections and the new provisions “attempt to achieve the same purpose”, “‘a stick’ to provide incentive for a recalcitrant injured worker” with residual earning capacity to perform ‘suitable employment’. Previously the penalty provision applied if the worker unreasonably rejected suitable employment. Under the new provisions the worker is required to make reasonable efforts to return to work in suitable employment. These are “different ends of the same animal”. The appellant submits the dicta in B and McDonald are applicable to the question of ‘reasonableness’ under s 48 of the 1998 Act.[37]
[37] Appellant’s further submissions, [14]–[16].
The appellant refers to Fazlic as authority for the proposition that the “test of reasonableness or unreasonableness is dependent upon the state of the worker’s knowledge at the relevant time”. The appellant submits that, in the current matter, the relevant time was when the appellant moved to Melbourne, thereby making it “geographically impossible” for her to undertake suitable employment in Orange. The appellant had been misled by a number of case managers, and considered that she was fulfilling her obligations in respect of rehabilitation, and would continue to receive weekly payments during incapacity.[38]
[38] Appellant’s further submissions, [17]–[18].
The appellant refers to McDonald, in which Keating P found that a failure by a worker to return to selected duties was not unreasonable, in circumstances where the worker could not work on certain days due to the need to care for his son. The President adopted[39] comments made by Gilchrist DP in Hines v WorkCover / HIH (Transfer Maintenance Pty Ltd) Corporation,[40] in which the Deputy President said:
“In determining the reasonableness of a rehabilitation and return to work plan or its provisions, consideration must be given to the personal circumstances of the worker. They are not paramount, but they must be taken into account.”[41]
[39] McDonald, [84].
[40] [2000] SAWCT 171 (Hines).
[41] Hines, [52].
The appellant submits she moved to Melbourne for the legitimate purpose of marrying her husband who lived there, she thought with the imprimatur of the insurer’s case managers. This was what prevented her taking up the offer of employment in Orange. This situation should have been paramount in determining ‘reasonableness’. Additionally, she was undergoing treatment for chronic pain, and the respondent had unreasonably refused to meet the cost of the operative intervention. The finding should have been that she had made reasonable attempts to return to suitable employment.[42]
[42] Appellant’s further submissions, [23].

Respondent’s further submissions

The respondent summarises the various authorities that were referred to in the Direction dated 25 March 2019. The respondent sets out various email communications involving the appellant, Ms Paag, Mr Lloyd and Ms Giacca (a case manager with the insurer), between 2 October 2015 and 15 November 2015. The respondent submits these emails are consistent with a state of knowledge on the appellant’s part that she “was required in co-operation with the respondent to make reasonable efforts to return to work in suitable employment at Orange High School”. The respondent refers to the headings to ss 48 and 48A of the 1998 Act (“Return to work obligations of worker” and “Failure to comply with return to work obligations of worker”). It submits Parliament imposed “clear and stringent obligations on a worker”, who has current capacity, to return to suitable employment with the employer. It submits this is consistent with the ordinary and plain meaning of the words.[43]
[43] Respondent’s further submissions, [29]–[31].
The respondent submits “reasonable efforts” are clearly defined in s 48(2)(a) to (c) of the 1998 Act, and the appellant does not fall within these provisions. It submits the authorities referred to in the Direction do not alter the situation, the Arbitrator’s findings were open and “no error of fact or law has been demonstrated”.[44]
[44] Respondent’s further submissions, [32]–[35].

Was ‘reasonableness’ raised at first instance?

It is necessary at the outset to deal with the respondent’s argument that ‘reasonableness’ was not raised at first instance. The appellant’s counsel, at the arbitration hearing, referred to matters that have also been the subject of submissions on appeal, going to the reasonableness of the appellant’s failure to take up the offer of employment at Orange High School. There was reference to her inability to drive, and the fact that she was, for an extended period, awaiting surgery on her frozen shoulder, liability for that procedure having been denied.[45] The appellant’s counsel quoted from s 48 of the 1998 Act, specifically the requirement to make reasonable efforts to return to suitable employment, including at another place of employment. He referred to the fact that the appellant did return to work, when she was living in Orange, after the first injury. He referred to what the appellant “was told from time to time by the claims people”. He described the offer of suitable duties in Orange as “disingenuous”.[46] The appellant’s counsel submitted that the respondent, if it were carrying out its obligations under s 49 of the 1998 Act, “would have assisted the [appellant] in obtaining employment in Melbourne, where she’s moved to”.[47] He said his client’s instructions were that “she had no accommodation once she’d sold her house, and was unable to return to Orange”.[48] These submissions, on their face, clearly related to the reasonableness of the appellant’s position regarding attempts to return to work.
[45] T 9.2–12.
[46] T 11.2–17.
[47] T 11.26–31.
[48] T 12.25–27.

The issue of the reasonableness of the appellant’s relevant actions, was sufficiently raised at first instance.

The operation of section 48(2) of the 1998 Act

The respondent submits that a worker’s “statutory obligation to ‘make reasonable efforts to return to work in suitable employment’ are clearly defined in s 48(2) and the [A]rbitrator was correct in finding that the appellant did not satisfy any of the definitions of ‘reasonable efforts’ as set out in s 48(2)(a) to (c).”[49] The appellant submits that s 48(2) does not limit what constitutes ‘reasonable efforts’ for the purposes of s 48(1). Rather, s 48(2) deems that reasonable efforts are being made while a worker is waiting for a rehabilitation plan.[50]
[49] Respondent’s submissions, [21], repeated in the respondent’s further submissions, [32].
[50] Appellant’s submissions, [21].
The appellant’s submission on this point is correct. Each of the subcll of s 48(2) applies while a worker is “waiting” for something to happen. A worker is treated as making a ‘reasonable effort’ when “waiting for the commencement of a workplace rehabilitation service” (subcl (a)), “waiting for a response to a request for suitable employment” (subcl (b)), or “waiting for suitable employment or pre-injury employment to commence” (subcl (c)). If compliance with subs (1) was restricted to matters described in subs (2), then a worker who was actually engaging in carrying out ‘suitable employment’, or undergoing rehabilitation pursuant to a plan, would not satisfy subs (1), as s/he would not be “waiting”. The words of s 48 do not restrict ‘reasonable effort’ to only the activities described in subs (2) of the section.
In a frequently quoted passage of Project Blue Sky Inc v Australian Broadcasting Authority, the plurality said:
“The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined ‘by reference to the language of the instrument viewed as a whole’. In Commissioner for Railways (NSW) v Agalianos, Dixon CJ pointed out that ‘the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed’. Thus, the process of construction must always begin by examining the context of the provision that is being construed.”[51] (footnotes omitted)
[51] [1998] HCA 28; 194 CLR 355; 153 ALR 490; 72 ALJR 841, [69].
The construction for which the respondent argues would be inconsistent with the ‘System objectives’ in s 3 of the 1998 Act, particularly subcl (c) which nominates an objective that “necessary medical and vocational rehabilitation” be provided “to assist injured workers and to promote their return to work as soon as possible”. Such a construction would also be inconsistent with the object of Ch 3 of the 1998 Act (see [23] above), which provides the Chapter is to “establish a system that seeks to achieve optimum results in terms of the timely, safe and durable return to work” of injured workers. A construction that promotes the purpose or object of the Acts is to be preferred to a construction that does not.[52]
[52] Section 33 of the Interpretation Act 1987, IW v City of Perth [1997] HCA 30; 191 CLR 1; 94 LGERA 224; 146 ALR 696; 71 ALJR 943, at 11–12.
The construction for which the respondent argues would be inconsistent with the overall scheme of Pt 2 of Ch 3 of the 1998 Act, of which s 48 forms part. There is nothing in the text of s 48 of the 1998 Act which requires that the question of whether a worker is making ‘reasonable efforts’ for the purposes of subs (1) be restricted to the circumstances described in subs (2), while a worker is waiting for other events contemplated in Pt 2 of Ch 3 to occur. The respondent’s submission that a worker’s statutory obligation to make ‘reasonable efforts’ is “clearly defined” by s 48(2) is rejected. Section 48(2) protects a worker in certain circumstances, by providing that s/he is treated as making a ‘reasonable effort’, whilst the worker is waiting for actions to be taken that involve steps by the employer or insurer.
Reading the Arbitrator’s reasons as a whole,[53] the Arbitrator did not restrict his enquiry to whether s 48(2) was satisfied, he dealt with s 48(2) in addition to other matters.[54]
[53] Beale v Government Insurance Office of NSW (1997) 48 NSWLR 430, 444.
[54] Reasons, [54].

Onus

The potential operation of s 48A of the 1998 Act is triggered by a failure by a worker to comply with an obligation imposed under s 48. The application of s 48(1) requires that a worker have ‘current work capacity’. The obligation is that the worker, “in co-operation with the employer or insurer, make reasonable efforts to return to work in suitable employment or pre-injury employment at the worker’s place of employment or at another place of employment”. Section 48A provides that if a worker does not comply with an obligation under s 48, the insurer may “suspend”, “terminate” or “cease and determine” weekly payments.
In Darling Island Stevedoring & Lighterage Co Ltd v Jacobsen[55] Dixon J (as his Honour then was) said:
“… if the true nature of the qualification is to introduce new matter, not as part of the primary grounds of liability, but as a special exception or condition defeating or answering liability otherwise existing, then the onus of proof lies with the party setting up default or wilful act by way of answer.”[56]
[55] [1945] HCA 22; 70 CLR 635 (Jacobsen).
[56] Jacobsen, 643.
Roche DP in B relied upon Jacobsen, in my view correctly, as authority that an employer carried the onus of proof, when it sought to rely on s 40(2A) of the 1987 Act in its then form, to reduce weekly compensation if a worker “unreasonably rejected suitable employment”.[57] The appellant relies on this decision,[58] and the respondent does not make a submission to the contrary. I accept that the respondent carries the onus of proof, in its reliance on ss 48 and 48A of the 1998 Act.
[57] B, [53].
[58] Appellant’s further submissions, [10], [13].

Application of the earlier authorities

The issue in Fazlic was whether the worker’s refusal to undergo recommended back surgery was “unreasonable”, such that he would be denied any further compensation.[59] The decisions in Duncan, McDonald and B involved the former s 40(2A) of the 1987 Act, in which a worker’s weekly entitlement was calculated on a less advantageous basis, if the worker had “unreasonably rejected suitable employment”. The decision in Burgess involved the former s 57(1) of the 1998 Act, and whether a worker had “unreasonably failed to comply with the requirement of Ch 3 of the 1998 Act” after being requested to do so by the insurer (leading to a suspension of his benefits).[60] Thus each of these decisions involved the concept of unreasonable action (or lack of action) by a worker.
[59] Fazlic, [6], [9].
[60] Burgess, [25].
Sections 48 and 48A in the current legislation provide for the suspension, etcetera of a worker’s weekly entitlement if s/he fails to act reasonably within the requirements of s 48. The appellant submits that whether a worker acts unreasonably, as opposed to failing to act reasonably, are “different ends of the same animal”. The appellant submits the earlier decisions apply to the issue of ‘reasonableness’ under s 48 of the 1998 Act.
The respondent does not submit that the change in structure of the relevant provisions, from whether a worker acted unreasonably, to whether s/he failed to act reasonably, has any effect on the applicability of the earlier decisions.
The respondent refers to the headings of ss 48 (“Return to work obligations of worker”) and 48A (“Failure to comply with return to work obligations of worker”). It submits that Parliament imposed “clear and stringent obligations on a worker, such as the appellant, who has ‘current capacity’ to return to work in suitable employment with the respondent”. It submits ss 48 and 48A are not ambiguous and the words should be given their “ordinary and plain meaning”.
The focus of the legislative provisions under the NSW legislation, dealt with in the earlier decisions, was whether a worker had acted unreasonably. The focus of s 48 is whether a worker has made reasonable efforts to return to work. In each case it is necessary to consider the reasonableness (or lack of it) of a worker’s actions. The earlier decisions are referred to below. As a general proposition, they require consideration of the state of knowledge and circumstances of the particular worker. This is logically appropriate, where the issue is whether an individual worker has acted reasonably or unreasonably. To take the factual situation in Fazlic, a worker does not act unreasonably by failing to have regard to medical opinion of which he is unaware. I accept the appellant’s submission that the principles in the earlier decisions remain relevant, in dealing with ss 48 and 48A.
The headings to ss 48 and 48A, to which the respondent refers, do not form part of the 1998 Act and do not assist: s 35(2) of the Interpretation Act 1987.[61]
[61] See also DC Pearce and RS Geddes, Statutory Interpretation in Australia (Butterworths, 8th ed, 2014), pp 202–3.

The earlier decisions referred to in the Direction

Fazlic was a matter under the Workmen’s Compensation Ordinance, Northern Territory. The worker, fearful of the outcome, declined to undergo surgery to his back which was recommended to him. There was evidence that the surgery would have been likely to be highly successful. The employer argued the worker should be denied further compensation of any kind under the relevant Ordinance, due to his unreasonable refusal to undergo the surgical treatment. The evidence was that the worker had a “strong and genuinely held fear of operation”, and that “[h]e knew almost nothing about the objective reasonableness of the operation”.[62] The High Court, upholding an appeal by the worker, said:
“Any assessment of the reasonableness or otherwise of a worker’s refusal of treatment must depend upon the worker’s state of knowledge at the relevant time. This accords both with good sense and with authority. A worker’s choice cannot be said to be unreasonable because he has failed to give effect to factors unknown to him. And in the case of complex medical or surgical procedures he will know little except what he is told. In the present case he was told very little indeed.”[63]
[62] Fazlic, [11].
[63] Fazlic, [12].
In Duncan, a worker suffered a cervical disc prolapse in an accident whilst driving a vehicle which rolled onto a railway line. After one month off work he resumed his duties as a station assistant, but with difficulty. The trial judge concluded that he was partially incapacitated. Subsequently, there was a “workplace reform procedure”, which ended the position the worker occupied. The worker was unsuccessful in obtaining employment for which he was physically suited in the reorganisation. After “failing to obtain his redesigned position, [the worker] accepted the offer of voluntary redundancy.”[64]
[64] Duncan, [10].
The employer’s case was that it did not enforce compulsory redundancies, and there were employees who “were not really gainfully employed … heading towards the ‘vegie patch’.” It argued the worker’s weekly entitlements should be reduced, on the basis that the worker “had suitable employment with Freightcorp and unreasonably discontinued that employment”.[65] There was no evidence the worker was offered duties in the ‘vegie patch’. The trial judge concluded that “when the avenues of redeployment and retraining had failed, [the worker] accepted voluntary redundancy”, a decision the trial judge described as “entirely reasonable”.[66] Dismissing an appeal by the employer, Davies AJA (Handley and Beazley JJA agreeing) referred to the decision in Fazlic, and said:
“Although Mr Duncan was aware that redundancy was not compulsory, he was informed that he would lose his position which was redesigned and that he had certain options, one of which was redundancy. In the light of the information given to him, his acceptance of the redundancy offered was reasonable, as the trial Judge found.”[67]
[65] Duncan, [11]–[14].
[66] Duncan, [16].
[67] Duncan, [19].
Burgess raised an issue under the former s 57(1) of the 1998 Act, regarding whether a worker unreasonably failed to comply with an Injury Management Plan prepared by the insurer. The worker said that the two job placements implemented under that plan aggravated his symptoms. He enrolled in a course in occupational therapy, and ceased participating in the Injury Management Plan. The insurer suspended his weekly payments. Roche DP described the question as whether the worker’s failure to comply with the Injury Management Plan was “unreasonable”.[68] He said the Arbitrator was required to “consider all relevant circumstances”[69] in considering this issue, which in addition to the objects set out in s 41(1), could include:
“… other matters, such as the worker’s attitude and approach to rehabilitation in general and whether he is serious about seeking a genuine and sustainable return to work, or, whether he is deliberately avoiding his obligations so as to prolong time on compensation, are also relevant. In looking at these matters it is necessary to consider a worker’s overall circumstances, his injury and incapacity, his education and qualifications, his likely career prospects in general and whether his past attempts at rehabilitation and or retraining have been genuine.”[70]
[68] Burgess, [27].
[69] Burgess, [46].
[70] Burgess, [42].
The employer’s appeal against an order reinstating the worker’s weekly payments was found to have no prospects of success.
McDonald involved an injured worker, a nurse, who returned to work on selected duties, and subsequently was faced with a situation where his domestic situation changed, and he needed to care for his young son for two days per week. He sought adjustment of his roster to accommodate this, and when this was not forthcoming, he resigned. He sought casual work from the employer which also was not forthcoming. An issue was whether the worker had “unreasonably rejected suitable employment” within the meaning of s 40(2A) and (2B) of the 1987 Act in its then form. Keating P said “an assessment of ‘reasonableness’ is a subjective assessment that will vary from case to case”.[71] His Honour referred to Fazlic and Duncan. His Honour referred to, and agreed with,[72] the following passage from Hines:
“In determining the reasonableness of a rehabilitation and return to work plan or its provisions, consideration must be given to the personal circumstances of the worker. They are not paramount, but they must be taken into account.”[73]
[71] McDonald, [77].
[72] McDonald, [81] and [84].
[73] Hines, per Gilchrist DP, [52].
His Honour concluded that “the worker’s resignation in the circumstance was not an unreasonable rejection of suitable employment”.[74]
[74] McDonald, [85].
The decision in B involved a worker who resumed suitable employment post-injury. Subsequently investigations indicated that while on suitable employment the worker had falsified timesheets and forged his supervisor’s signature on some time sheets. A disciplinary interview was arranged, but the worker resigned before it was held. The employer sought to defend the matter relying on s 40(2A) of the 1987 Act in its then form, arguing the worker had unreasonably rejected suitable employment.
Roche DP referred to Fazlic, Duncan, Hines and McDonald. The Deputy President noted the employer had written to the worker advising that it was considering termination of his employment on the basis of medical advice, and that he should consider looking for alternative employment. The Deputy President noted the worker had previously participated in a rehabilitation program, and that suitable duties he had previously carried out were no longer available. It was not unreasonable that the worker seek suitable employment, rather than await the outcome of the disciplinary process. He was not satisfied there had been an unreasonable rejection of suitable employment.[75]
[75] B, [67]–[69].

How the issue of ‘reasonableness’ was dealt with at first instance

The appellant’s submissions refer to multiple factors, which are said to be inconsistent with the proposition that the appellant failed to make reasonable efforts to return to suitable employment. These are summarised at [33] to [36], and [51] above. The appellant submits the Arbitrator “considered only one factor in respect of reasonableness, that is, the failure to comply with the injury management plan”.[76]
[76] Appellant’s submissions, [23].
The Arbitrator described the issue before him regarding reasonableness, being whether the appellant “had made in co-operation with the employer or the insurer, reasonable efforts to return to work in a suitable employment or pre-injury employment at her place of employment or at another place of employment”.[77] The Arbitrator referred to various communications with claims officers, five of whom the appellant named, who she said told her “there would be no problem in transferring my case to Melbourne”. The appellant “was advised and understood” that her medical care could continue in Melbourne and she would be supported in job seeking in that city when fit for work. She was advised by Ms Paag, the rehabilitation consultant, that her case would be transferred to “a caseworker for rehabilitation and job seeking based in Geelong”.[78]
[77] Reasons, [45].
[78] Reasons, [46].
The Arbitrator referred to various email communications. On 21 October 2015 Ms Paag informed Mr Lloyd that the appellant wished to have a Melbourne doctor (Dr Patel) as her nominated treating doctor, and that if the appellant was able to “locate suitable employment in Melbourne it appears likely that she will not return to work in Orange”. The Arbitrator referred to the appellant’s email to Mr Lloyd dated 8 November 2015 (see [11] above) in which she indicated that when fully fit she intended securing a position in Victoria, although was prepared to travel back to Orange if she could not find such a position in Victoria. She said she was now “in a very difficult position now as [she was] not fully fit to seek a full-time position as a person attractive to employ”.[79] The Arbitrator referred to emails from the appellant to Ms Giacca dated 13 and 15 November 2015. In the second of these she told Ms Giacca that “Dr Patel would not endorse a return to work in Orange”, and that from 17 November 2015 she was available for light duties in Melbourne”. This email included the passage:
“As such I am now informing you that I am not able to follow your demands to be at Orange High School for light duties this morning. This is not, as you maintain, non compliance but is not practical and inconsistent with all the advice I had been given previously.”[80]
[79] Reasons, [47]–[49].
[80] Reasons, [50].
The Arbitrator referred to the three notices issued by the respondent on 3 March 2016, 24 March 2016 and 27 April 2016. He concluded that the appellant was fit for modified duties. He noted the appellant had indicated to Mr Lloyd on 8 November 2015 that she was prepared to travel back to Orange if she did not obtain a position in Victoria. He noted the appellant indicated this would be difficult as she was not fully fit. He said that in the circumstances “the respondent was not acting unreasonably in offering the [appellant] suitable employment in Orange”.[81]
[81] Reasons, [51].
The Arbitrator referred to the definition of ‘suitable employment’ in s 32A of the 1987 Act (see [26] above). He particularly referred to subcll (a)(iii) and (b)(iv) of the definition, saying:
“It says that quite clearly there was an injury management plan in place and that the [appellant’s] moved [sic] to Melbourne should be ignored when considering her fitness for suitable employment. The legislation is quite clear and I accept this submission.”[82]
[82] Reasons, [53].

The Arbitrator made the following factual finding:
“In my view, having regard to all of the evidence, the applicant has not in co-operation with the respondent or the insurer made it [sic] reasonable efforts to return to work in suitable employment at Orange High School. There is no evidence that she made such efforts at another place of employment. Further, I do not find that the applicant is to be treated as making a reasonable effort to return to work in suitable employment or pre-injury employment during any reasonable period for the reasons set out in section 48(2) of the 1998 Act.”[83]
[83] Reasons, [54].
The Arbitrator also dealt with a submission that the legislation should be interpreted beneficially. He referred to Goudappel,[84] saying:
“Similarly, sections 48-49 of the 1998 Act, which were also introduced into that Act by the 2012 amendment Act, are clearly not beneficial. There is no constructional choice that would enable section 48 to be interpreted so as to avoid its application to the applicant’s entitlement in this case.”
[84] Goudappel, [29]–[30].
The Arbitrator entered an award for the respondent on the claim for weekly compensation.

Was there error in the approach taken?

The Arbitrator referred to the statutory test posed by ss 48 and 48A, and to the appellant’s evidence regarding communications to her, by claims officers of the respondent’s insurer, about transferring her case to Melbourne. He referred to matters put by the appellant, arguing against the proposition that she had failed to make reasonable efforts. He referred appropriately to the statutory test in ss 48 and 48A, in his ultimate finding of fact regarding whether s 48A applied in the circumstances. Notwithstanding this, the appellant’s submission is correct, that the Arbitrator determined the issue by reference to whether there was failure to comply with the injury management plan (see [77] above), rather than by reference to the broader issue of whether there was a failure by the appellant to make “reasonable efforts”.
After describing the evidence, the Arbitrator’s analysis of whether s 48A applied in the circumstances was essentially set out at [51] to [54] of his reasons. He found that the appellant was not totally incapacitated (that is, she had ‘current work capacity’). He referred to the appellant’s indication that, if fully fit, she would consider returning to Orange to obtain a position if she could not find one in Melbourne. He found in these circumstances, the respondent “was not acting unreasonably” in offering suitable employment in Orange. After referring to the definition of ‘suitable employment’ in s 32A, the Arbitrator found that the move “to Melbourne should be ignored when considering her fitness for suitable employment”. He said the legislation was “quite clear and specific”, and he then made the ultimate finding of fact at [54] of the reasons. The Arbitrator’s analysis did not extend beyond the identification of ‘suitable employment’, to whether the appellant had complied with her statutory obligation in s 48(1). That question was not answered simply by identifying ‘suitable employment’
Whether s 48A applied was a matter on which the respondent carried the onus. What s 48(1) required was that the appellant, “in co-operation with the employer or insurer, make reasonable efforts to return to work in suitable employment at the worker’s place of employment or at another place of employment”. The obligation was to “make reasonable efforts”, and the principles in Fazlic, and the associated authorities referred to above, are relevant to whether the appellant complied with her obligations pursuant to s 48. Also relevant are the objects of both the 1998 Act as a whole, and of Ch 3 of that Act (of which ss 48 and 48A form part). The provision of necessary vocational rehabilitation is one of the ‘System objectives’ set out in s 3 of the 1998 Act. The object of Ch 3 is described in s 41(1) of the 1998 Act as the establishment of “a system that seeks to achieve optimum results in terms of the timely, safe and durable return to work for workers following workplace injuries”. It is appropriate that consideration of whether a worker made “reasonable efforts” for the purposes of s 48 of the 1998 Act have regard to the objects of the legislation.
The Arbitrator was required to consider the reasonableness of the appellant’s actions, in dealing with whether the appellant failed to make reasonable efforts to return to work. This he did not do, save for finding that the move to Melbourne should be ignored, in considering the appellant’s fitness for ‘suitable employment’. This did not mean that the appellant’s personal circumstances, including those associated with the relocation and changed family circumstances, were not relevant to whether the appellant’s obligations pursuant to s 48 of the 1998 Act were complied with. There was error of the type referred to in Waterways Authority v Fitzgibbon,[85] in which Hayne J said:
“In the present case, however, reference to the ‘sufficiency’ of the primary judge’s reasons is not to be understood as seeking to invoke only those principles. Rather, because the primary judge was bound to state the reasons for arriving at the decision reached, the reasons actually stated are to be understood as recording the steps that were in fact taken in arriving at that result. Understanding the reasons given at first instance in that way, the error identified in this case is revealed as an error in the process of fact finding. In particular, it is revealed as a failure to examine all of the material relevant to the particular issue.”[86]
[85] [2005] HCA 57; 221 ALR 402; 79 ALJR 1816 (Waterways Authority).
[86] Waterways Authority, [130].
It follows from the above that the error identified in Ground No 2 is made out. Ground No 4 raised a failure by the Arbitrator to deal with the consequences of the assurances given by claims officers of the insurer, about the effect that the appellant’s move to Melbourne would have on her compensation rights. Those assurances were relevant to the state of knowledge of the appellant, which was directly relevant to whether the appellant’s efforts were reasonable, having regard to the decision in Fazlic. The failure of the Arbitrator to deal with such assurances, in this context, constituted error, and to that extent the error alleged in Ground No 4 is made out. The appellant also raised an argument based on waiver, in part based on the assurances of the claims managers.[87] The waiver argument is not dealt with, as it is unnecessary in the circumstances to do so. For reasons given above, the Arbitrator’s reasons did not adequately expose his reasoning on the issue of reasonableness. The error alleged in Ground No 4 is made out. It is not necessary to further deal with the balance of the grounds. It is appropriate that I re-determine, pursuant to s 352(7) of the 1998 Act, the issue of whether the respondent is entitled to rely on s 48A of the 1998 Act by way of defence to the appellant’s claim for weekly compensation.

RE-DETERMINATION

[87] Appellant’s submissions, [32].

The factual background

The structure of s 48A of the 1998 Act is that an insurer’s entitlement to take the first of the steps there described (that in s 48A(2)) arises if a worker does not comply with an obligation imposed under s 48. The machinery in s 48A cannot be set in train, unless there was first a failure by the worker to comply with an obligation under s 48(1). This focusses attention initially on whether there was such a failure, before a notice under s 48A(2) was issued.
The insurer issued a work capacity decision dated 24 August 2015,[88] in which it assessed the appellant’s pre-injury average weekly earnings at $749.08, and her current work capacity at “0 per week”. Her weekly entitlement was assessed at $603.70 per week, from 7 September 2015.
[88] Reply, pp 146–147.
The insurer issued a “Notice of Warning to Suspend Weekly Benefits” on 24 November 2015,[89] and again on 17 February 2016. [90] Each of these was a pro forma document, in unsatisfactory form. Those sections of the documents that required completion by a claims manager (much of the content) were uncompleted.
[89] Reply, pp 148–149.
[90] Reply, pp 150–152.
The insurer issued a third “Notice of Warning to Suspend Weekly Benefits” dated 3 March 2016.[91] This document was completed. It referred to RTW 3 dated 22 February 2016, advising “there are duties for you at Orange High School as an Administrative Officer”. It referred to an “Injury Management Plan dated 19/2/2016”, that advised the appellant to resume her position as an Office Administrator at Orange High School. The Details of Non-Compliance specified in the Notice were failure to meet the obligations in the Injury Management Plan, failure to make all reasonable efforts to return to work in suitable or pre-injury employment at the pre-injury or at another place of employment, and failure to return on suitable duties “as per the Return to Work Plan 3”.
[91] Reply, pp 153–154.
RTW 3[92] was dated 22 February 2016, and provided for the appellant to resume work on selected duties commencing from 22 February 2016. It provided for the appellant to work 6 hours and 15 minutes per day, 5 days per week. This would be roughly equivalent to the length of a full school day, and equals the appellant’s pre-injury hours of 31.25 hours per week.[93] The four stages of the plan spanned a period from 22 February 2016 to 16 December 2016. There were breaks between each of the four stages of the plan. Whilst it is not completely clear, these probably reflected when school holidays fell that year. All stages of the plan were to be performed at Orange High School. RTW 3 was signed by Ms Paag, the rehabilitation consultant. The copy in evidence is not countersigned by anyone else.
[92] AALD 21.9.18, pp 95–99.
[93] Allianz letter 19 February 2016, AALD 21.9.18, p 20.
The Injury Management Plan dated 19 February 2016[94] specifically provided for the appellant to “resume [her] position as an Office Administrator at [her] substantive place of employment with the Department of Education, Orange High School”. It advised the appellant “Should you not return to the suitable employment offered at your substantive school your entitlement to weekly payments will cease.” The copy of this Injury Management Plan in evidence was signed only on behalf of the insurer. Both RTW 3 and the Injury Management Plan dated 19 February 2016, relied on by the insurer in its third and ultimate notice pursuant to s 48(2) of the 1998 Act, specifically provided that the appellant was obliged to perform selected duties at Orange High School, if she was to comply with her return to work obligations. RTW 3 was to be implemented over (effectively) almost the whole calendar year of 2016.
[94] AALD 21.9.18, pp 112–115.
The insurer issued a Notice of suspension to weekly payments dated 24 March 2016.[95] It relied on the appellant’s failure to meet the requirements outlined in [93] to [94] above. The insurer issued a Notice of decision to terminate weekly payments dated 14 April 2016. It relied on the same alleged failures, which it stated had “still not been reached”. The insurer issued two further Notices of decision to terminate weekly payments dated 21 April 2016 and 27 April 2016, in the same terms as the first.
[95] Reply, pp 155–157.
Although the notices issued by the insurer under s 48A pursued a somewhat erratic course, the matter proceeded on the basis that there was no suggestion that the respondent had failed to comply with the procedural requirements in section 48A.[96]
[96] Reasons, [44].
There were significant previous dealings between the appellant, the respondent and the insurer, going to the appellant’s move to Melbourne, and where rehabilitation and job search activities should be performed.
The appellant stated that she had intended marrying Mr Potter (now her husband) and moving to Victoria, prior to her injury. She said this intention was common knowledge at her workplace. She said that following her injury she became concerned that her move to Victoria may affect her workers compensation rights, and advised five claims officers, who she identified, of her intended move. She said “they all assured me that there would be no problem transferring my case to Melbourne”.[97] She said:
“I was advised and understood that I could transfer my case to Melbourne and I would be supported in job seeking in Melbourne once fit for work.”[98]
[97] Appellant’s statement, 29 August 2018, [4]–[12], AALD 29.8.18, p 1.
[98] Appellant’s statement, 29 August 2018, [13], AALD 29.8.18, p 2.
The appellant said that she told each new caseworker of her intended move, and “was led to believe from my conversations with the various caseworkers that the move would be okay and not cause any complications to my case”. She said that when she moved to Victoria Ms Paag told her that her “case would be transferred to a caseworker for rehabilitation and job seeking based in Geelong”. The appellant said she sold her home (in Orange) on 12 June 2015, and moved to Melbourne on 16 August 2015. She and her husband married on 21 November 2015.[99] The appellant forwarded an email to Ms Giacca (a claims officer with the insurer) dated 6 October 2015. She stated this was because she was frustrated by requests from the insurer that she see the general practitioner in Orange.[100] The appellant indicated she would not be able to travel to Orange. She was in “significant pain”, and medication made her “very drowsy and therefore not safe to drive”. As she would be staying 20 kilometres from town, she would not be able to do a daily drive from that accommodation into Orange on a daily basis to work. She said:
“So just to be clear – I will not be returning to Orange this week but will see my GP here on Thursday and will await his opinion based on my scan as to my fitness to drive and therefore fitness to return to work.”[101]
[99] Appellant’s statement, 29 August 2018, [14]–[17] AALD 29.8.18, p 2.
[100] Appellant’s statement 29 August 2018, [21], AALD 29.8.18, p 2.
[101] AALD 29.8.18, p 12.
Ms Paag from Rehabilitation Services reported on 31 December 2015.[102] She noted that the appellant “remained residing in Melbourne”. She said that a suitable duties plan, providing for office duties at Orange High School, had been signed by “Dr Poh (previous nominated treating doctor)”, Mr Lloyd and Mr Proctor (a return to work coordinator). It said that Ms Giacca contacted the appellant on 10 November 2015, telling her she needed to be at Orange High School to complete suitable duties. The appellant said she had no accommodation. “Ms Giacca stated that [the appellant] would need to arrange for accommodation and return to work from 16.11.2015.” Ms Paag said the appellant “stated that she has moved to Melbourne permanently and therefore wants to job seek”. Ms Paag stated that a certificate was obtained from Dr Proimos that the appellant was fit for 30 hours’ work per week. The report said that Rehabilitation Services would liaise with Mr Proctor and Mr Lloyd to see if they could accommodate the appellant on suitable duties “for the next 12‑18 months”. An action item in the report provided that written confirmation be sought from Mr Lloyd and Mr Proctor “of their availability to provide [the appellant] with suitable duties for 12-18 months to allow time for the adhesive capsulitis to resolve”.
[102] AALD 29.8.18, pp 24–25.
On 15 November 2015 the appellant forwarded a lengthy email to Ms Giacca.[103] It referred to the diagnosis of frozen shoulder, the potential requirement to have further surgery, and the fact that medication made the appellant drowsy and prevented her from driving. It referred to the fact that the appellant was “… preparing for [her] wedding next Saturday in Canberra”. The email said in part:
“I am now informing you that I am not able to follow your demands to be at Orange High School for light duties this morning. This is not, as you maintain, non compliance but is not practical and inconsistent with all the advice I have been given previously.”
[103] AALD 29.8.18, pp 21–22.
In an application to the insurer to change her nominated treating doctor, dated 21 December 2015, she told the insurer that she “moved to Melbourne to marry my husband who lives and works here and has children here”.[104]
[104] AALD 29.8.18, p 23.
The essential issue revolves around the reasonableness of the appellant’s failure to take up suitable duties at Orange High School, when these were made available. Issues of reasonableness depend on the facts and circumstances of each individual case. The appellant’s evidence, which I accept, is plausible and largely uncontroverted. From before she sustained injury, it was her intention to move to Victoria to marry her now husband, and this was common knowledge at her workplace at Orange High School. She had conversations with various case managers from the insurer, in which she said that she proposed moving to Melbourne. She was assured there would be no problem, and that she would be supported in job seeking in Melbourne when she was fit for work. She understood this to be the case. Ms Paag at one point told her that her case would be transferred to a caseworker, for rehabilitation and job seeking, based in Geelong. The appellant’s husband, with whom she resided in Melbourne, worked there and had children there. It can reasonably be inferred that he could not have readily relocated to Orange. The appellant had sold her previous home in Orange, and did not have accommodation readily available in that city.
It is clear, from the medical evidence overall, that by the time a return to work was being considered the appellant had a significant disability affecting her left shoulder, and suffered from the condition of a frozen shoulder. Her ability to drive was affected by drowsiness associated with her medication. Against this background, Ms Giacca from the insurer contacted the appellant (who was residing in Melbourne with her then fiancé) on 10 November 2015, telling her that she needed to arrange for accommodation in Orange and return to work there from 16 November 2015. The appellant was to be getting married on 21 November 2015.
Quite clearly it would have been necessary for the appellant to relocate to Orange, if she were to take up the suitable duties. The arrangement envisaged by the rehabilitation provider was not a short term one. The rehabilitation report of Ms Paag dated 31 December described a need to confirm the availability of suitable duties for 12 to 18 months, “to allow time for the adhesive capsulitis to resolve”. RTW 3 provided for the performance of suitable duties for five days per week, subject to some breaks that probably reflected school holidays, from February 2016 to December 2016.

Did the appellant fail to comply with her obligation to make ‘reasonable efforts’?

Section 48(1) of the 1998 Act contemplates a return to work “at the worker’s place of employment or at another place of employment”. Ms Paag’s report dated 31 December 2015 specifically noted that the appellant said that she had moved to Melbourne permanently, and “therefore wants to job seek”, a possibility that does not appear to have been pursued by the insurer or the rehabilitation provider.
The appellant’s decision to sell her house in Orange and move to Melbourne, in circumstances where she was moving to be with the man who was to become her husband, and where she accepted assurances from multiple claims officers that such a move would not cause any complications to her workers compensation claim, could not be regarded as other than reasonable. It is appropriate to consider the reasonableness of her actions in the context of the information given to her by the claims officers, which she accepted.[105]
[105] Fazlic, [12], Duncan, [19].
When the appellant was approached by Ms Giacca in November 2015, to take up suitable duties at Orange High School, the appellant was then living permanently in Melbourne. Ms Giacca gave the appellant a matter of days to travel to Orange, arrange accommodation there, and commence work, this in circumstances where she had a frozen left shoulder, and could not drive because of drowsiness associated with the medication she was taking for her pain. Her failure to take up the suitable duties in those circumstances was reasonable.

In so far as RTW 3 and the Injury Management Plan dated 19 February 2016 are concerned, the appellant was by then living on a permanent basis with her husband in Melbourne. RTW 3 required that the appellant carry out duties for the same hours that she had worked pre-injury, over five days per week, at Orange High School, to the end of the school year in December 2016. It was not a temporary arrangement. It would have been necessary that the appellant leave her husband and what by then was her home in Melbourne, travel to Orange, and set up home on at least a semi-permanent basis in Orange. The appellant described her situation domestically:
“21.   I take pain medication regularly.
22.    I struggle to attend to my own personal care such as washing and blow drying my hair due to my shoulder injury. I rely heavily on my right hand to complete these tasks.
23.    Domestic activities are also challenging for me to complete due to the pain and discomfort I experience in my left shoulder.”[106]
[106] Appellant’s statement 15 May 2018, ARD, p 214.
The appellant, at this time, suffered from the symptoms of adhesive capsulitis which had developed following her first surgical procedure of 30 July 2015. Her symptoms as at October 2015 were described in Dr Kwa’s report dated 20 October 2015.[107]
[107] ARD, pp 36–37.
In determining whether the appellant’s failure to comply with RTW 3 and the Injury Management Plan dated 19 February 2016 was reasonable, it is appropriate to have regard to the objects of Ch 3 of the 1998 Act, set out in s 41(1) of the Act:
“The object of this Chapter is to establish a system that seeks to achieve optimum results in terms of the timely, safe and durable return to work for workers following workplace injuries.”
Compliance with RTW 3 and the relevant Injury Management Plan would, at the least, have been highly disruptive of the appellant’s domestic and personal arrangements. It would have involved taking a worker who had a serious shoulder condition, that caused her difficulty in self-care, performing domestic activities and driving, and have required that she move from Melbourne to Orange. This move would, of necessity, have involved her living in Orange for most of the year 2016, possibly for longer based on Ms Paag’s estimates. Whilst there was not specific evidence on the point, it is difficult to envisage that the appellant’s husband, who had both work commitments and children from an earlier relationship in Melbourne, could readily have followed her to Orange. The requirements in RTW 3 and the relevant Injury Management Plan were not consistent with a “timely, safe and durable return to work” (emphasis added).
The level of disruption involved, in implementation of RTW 3 and the Injury Management Plan, would have militated against a durable return to work. It is noteworthy that the appellant co-operated with a successful return to work following the earlier of her shoulder injuries, and it was not previously suggested that she was non-compliant in matters relating to rehabilitation. She was then directed to comply with a plan that would have involved her moving hundreds of kilometres away from her home (and husband) in Melbourne, to Orange, where she had no place to live, for a period of about one year (perhaps more). The insurer persisted in this approach, notwithstanding that the appellant raised the fact that she had moved to Melbourne on a permanent basis, and wished to job seek (see [101] above). This was an approach that Ms Paag had previously suggested was available, for “rehabilitation and job seeking, based in Geelong” (see [104] above). Section 48(1) of the 1998 Act specifically raises the possibility that reasonable efforts to return to employment may be “at another place of employment”.
In McDonald Keating P quoted with approval from a decision of Curtis J in Marmara v K Mart Australia Ltd,[108] where his Honour said a worker “is not a serf or a peon”.[109] The obligation of a worker pursuant to s 48(1) is to make reasonable efforts “in co-operation with the employer or insurer”. That reasonable efforts be made in co-operation between the worker, and the employer or insurer, is consistent with seeking to achieve a durable return to work, one of the objects of the Chapter. The history above is not indicative of the insurer seeking the appellant’s co-operation in implementing RTW 3 and the relevant Injury Management Plan. When, in November 2015, the appellant was approached at short notice to travel to Orange to commence suitable duties, and she said that she had no accommodation, Ms Giacca from the insurer told her she “would need to arrange for accommodation and return to work from 16.11.2015” (see [101] above).
[108] Curtis J, 13 November 2000 (unreported).
[109] McDonald, [82].
The Arbitrator made a finding that the respondent did not act unreasonably in offering the appellant suitable employment in Orange.[110] I accept the appellant’s submission that this misstated the question posed by ss 48 and 48A. The issue was not whether the respondent acted reasonably, but whether the appellant failed to make reasonable efforts to return to work in suitable employment (see [36] above). Having regard to the facts and circumstances of the current matter, the respondent could not establish, on the probabilities, that the appellant failed to comply with an obligation to make reasonable efforts to return to work, within the meaning of ss 48 and 48A of the 1998 Act. The consequence is that the respondent’s defence, to the appellant’s pleaded claim for weekly payments, fails.
[110] Reasons, [51].

CONCLUSION

The Arbitrator rejected the appellant’s argument that her periods of entitlement, for the purposes of the first and second entitlement periods pursuant to ss 36 and 37 of the 1987 Act, were doubled on the basis that her incapacity resulted from two injuries.[111] That finding is not challenged on this appeal, and stands. To the extent that the Arbitrator’s finding on this point was obiter, it was correct and I agree with it.
[111] Reasons, [33]–[38], [59].
The Arbitrator also rejected an argument by the appellant that her current weekly wage rate was other than the figure contained in the work capacity decision dated 24 August 2015 (see [91] above). That finding is not challenged on this appeal. Again, to the extent that the Arbitrator’s finding was obiter, it was correct and I agree with it.[112]
[112] Reasons, [59].
It was argued before the Arbitrator that the appellant was totally incapacitated, that is she had ‘no current work capacity’, during the period of the claim. The Arbitrator rejected this argument.[113] The finding was available on the evidence and stands.
[113] Reasons, [51].
The Arbitrator identified, as a matter in issue, whether ss 48 and 49 of the 1998 Act were ‘beneficial legislation’.[114] That matter does not require separate determination. The reasoning above does not rely on the proposition that those provisions of the 1998 Act be characterised as ‘beneficial’.
[114] Reasons, [8].
The period of entitlement pursuant to s 60 of the 1987 Act, availabIe to the appellant having regard to s 59A of that Act, may well be affected by the additional weekly entitlement payable to the appellant. I note that, on the evidence, the work capacity decision dated 24 August 2015 remains undisturbed. It will be necessary that an award for the appropriate remaining period of entitlement, pursuant to s 37 of the 1987 Act, be entered. It is appropriate that the matter be remitted to the same Arbitrator, for determination of the appellant’s weekly entitlement, and any other matters such as further orders relating to s 60 of the 1987 Act, consistent with these reasons.

DECISION

The Arbitrator’s decision dated 9 November 2018, other than to the extent to which it is expressly confirmed by these reasons, is revoked.
In substitution, there is a finding that the respondent’s defence pursuant to ss 48 and 48A of the 1998 Act fails, and that the appellant is entitled to weekly payments of compensation consistent with the work capacity decision dated 24 August 2015, for the remainder of the second entitlement period.

The matter is remitted to the same Arbitrator, to make orders for weekly payments consistent with these reasons, and any associated orders, such as necessary orders for the payment of expenses pursuant to s 60 of the 1987 Act, beyond those previously made.

Michael Snell

DEPUTY PRESIDENT

14 May 2019