Cullen v Plumbrite Plumbing Pty Limited T/as Clyde View Caravan Park
[2007] NSWWCCPD 173
•9 August 2007
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:Cullen v Plumbrite Plumbing Pty Limited t/as Clyde View Caravan Park [2007] NSWWCCPD 173
APPELLANT: John William Cullen
RESPONDENT: Plumbrite Plumbing Pty Limited t/as Clyde View Caravan Park
INSURER:GIO Workers Compensation (NSW) Ltd
FILE NUMBER: WCC11389-06
DATE OF ARBITRATOR’S DECISION: 20 February 2006
DATE OF APPEAL HEARING: 25 July 2007
DATE OF APPEAL DECISION: 9 August 2007
SUBJECT MATTER OF DECISION: Apprehended bias; section 40 Workers Compensation Act 1987
PRESIDENTIAL MEMBER: Deputy President Bill Roche
HEARING:Oral
REPRESENTATION: Appellant: Mr Hanlon, instructed by Russell McLelland Brown Lawyers
Respondent: Mr Newton, instructed by Moray & Agnew
ORDERS MADE ON APPEAL: The Arbitrator’s determination dated 1 March 2007 is revoked and the following orders made:
“1.The matter is remitted to a different Arbitrator for the Appellant Worker’s claim to be re-determined in accordance with the reasons in this decision.
2.Costs of the first arbitration are to follow the event of the second arbitration.”
The Respondent Employer is to pay the Appellant Worker’s costs of the appeal.
BACKGROUND TO THE APPEAL
John William Cullen (‘the Appellant Worker/Mr Cullen’) started work for Plumbrite Plumbing Pty Limited t/as Clyde View Caravan Park (wrongly sued as Clyde View Caravan Park) (‘the Respondent Employer/Caravan Park’) as a handyman/cleaner on 19 June 2003. His hours were 8.30am to 4.30pm Monday to Friday. His duties were varied and included cleaning the barbeque area, emptying rubbish bins, cleaning the pit in the stormwater drain, maintaining the lawns and gardens, checking gas bottles and delivering them to sites, and painting cabins as necessary.
On 25 August 2003 he experienced sharp pain in his lower back when he attempted to lift a bag of rubbish in the course of his employment. He sought medical attention and, though he was certified by a general practitioner, Dr Brandson, to be unfit for one day, he returned to work the next day and continued working until September 2003. On 9 September 2003 he was mowing the lawn at the Caravan Park when he claims that his back pain increased. Mr Cullen continued his lawn mowing duties on 10 September 2003 and ceased work at about 4pm. The exact sequences of events on 10 September 2003 are the subject of conflicting evidence. Mrs Hawke, the Caravan Park’s caretaker, asserts in her statement of 16 October 2003 that Mr Cullen worked without restriction or complaint on that day and Mr Cullen asserts to the contrary. It is not disputed that at about 4pm on that day Mr Cullen was given a letter terminating his employment with the Caravan Park effective on 17 September 2003.
On 11 September 2003 Mr Cullen attended on a Dr Muskett at Moruya and was given a certificate of unfitness for work for seven days. Mr Cullen first saw his family doctor, Dr Murray, on 16 September 2003 and was, for the first time given a WorkCover medical certificate certifying him to be fit for suitable duties from 26 August to 24 September 2003 because of “low back pain/strain”.
Mr Cullen’s claim for compensation was initially declined by GIO Workers Compensation (NSW) Ltd (‘GIO’) by letter dated 23 January 2004 on the ground that Mr Cullen’s employment was not a substantial contributing factor to his injury. On 17 August 2005 Mr Cullen’s solicitor wrote to the GIO and requested that it review its decision on liability and, in addition, claimed lump sum compensation in respect of a 12% whole person impairment. The GIO reviewed the claim and by letter dated 21 October 2005 advised that it was prepared to accept liability for outstanding weekly compensation and made an offer to settle the claim for lump sum compensation in the sum of $7,500.00 representing 6% whole person impairment. Further correspondence passed between the parties but they were unable to settle the claim for lump sum compensation.
By letter dated 24 March 2006 the GIO declined “ongoing liability for weekly payments and medical expenses” on the basis of certain medical reports. In addition, it declined “further liability on the basis of s4 and 9A of the Workers Compensation Act 1987 on the basis that your alleged injury did not arise during the course of your employment and that your employment was not a substantial contributing factor to [your] back condition”. Weekly compensation ceased on 3 May 2006.
Mr Cullen’s Application to Resolve a Dispute (‘the Application’) was registered in the Workers Compensation Commission (‘the Commission’) on 26 July 2006 seeking weekly compensation from 4 May 2006 to date and continuing together with lump sum compensation in respect of a 12% whole person impairment.
The Caravan Park filed a Reply on 17 August 2006 putting all matters in issue though at the arbitration it was conceded that injury was not in issue.
On 5 October 2006 the matter was referred by a Commission Arbitrator to an Approved Medical Specialist (‘AMS’) for assessment of Mr Cullen’s whole person impairment. A Medical Assessment Certificate (‘MAC’) was issued on 3 January 2007 in which Mr Cullen was assessed to have 5% whole person impairment, after allowing a 10% deduction for pre-existing injury or abnormality.
At a teleconference on 30 January 2007 the matter was listed for conciliation and arbitration on 20 February 2007. The matter could not be resolved and proceeded to arbitration with Mr Cullen being cross-examined and the parties making lengthy submissions. In the course of the hearing, counsel for Mr Cullen made an application that the Arbitrator disqualify himself on the ground of apprehended bias. That application was unsuccessful and the matter concluded with the Arbitrator delivering an ex tempore decision in which he made an award in favour of the Caravan Park on the basis that Mr Cullen could earn more as a courier or handyman than he earned with the Caravan Park.
By an ‘Appeal Against Decision of Arbitrator’ filed in the Commission on 20 March 2007 the Appellant Worker seeks leave to appeal the Arbitrator’s refusal to disqualify himself and his findings on incapacity.
LEAVE TO APPEAL
Time
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’).
Monetary Threshold
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 quantum in issue on the appeal is in excess of $5,000.00 and therefore the threshold in section 352(2)(a) of the 1998 Act is satisfied. No award of compensation has been made in this case but the Arbitrator’s finding would result in the Appellant Worker receiving no compensation and therefore the second limb of section 352(2) does not apply (see Mawson v Fletchers International Exports Pty Ltd [2002] NSWWCCPD 5).
I grant leave to appeal.
THE DECISION UNDER REVIEW
The ‘Certificate of Determination’, dated 1 March 2007, records the Arbitrator’s orders as follows:
“1.There will be an award for the Respondent.
2.No order as to costs.”
ISSUES IN DISPUTE
The issues in dispute in the appeal are whether the Arbitrator erred in:
(a)failing to apply the rules of natural justice and procedural fairness (‘apprehended bias’);
(b)failing to disqualify himself on the ground of apprehended bias (‘apprehended bias’), and
(c)his findings as to Mr Cullen’s work capacity and ability to earn as his findings were not supported by the evidence (‘capacity to earn’).
REVIEW
The nature of a review and the role and function of a Presidential member on appeal has been considered in many cases in the Commission. In The King Island Company Limited v Deery [2005] NSWWCCPD 1 it was held at [19]:
“19. A Presidential Member on appeal has a specific and limited role in the review of a decision of an Arbitrator. The review is not a rehearing. The Presidential member is not dealing with the matter de novo and is not arriving at a fresh decision based on all of the evidence available at a later time (Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194; Builders Licensing Board v Sperway Constructions (Sydney) Pty Ltd (1976) 135 CLR 616). 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). Alternatively, the Presidential Member may remit the matter back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions made.”
The nature of a review was considered by the Court of Appeal in Aluminium Louvres & Ceilings Pty Limited v Zheng [2006] NSWCA 34 where Bryson JA said at [38]:
“A review is a different process to an appeal and the matters which may be considered and the manner in which they may be considered are somewhat wider. See Boston Clothing Co Pty Ltd v. Margaronis (1992) 27 NSWLR 580 at 584 (Kirby P). An attack, on review or otherwise, on an Arbitrator's discretionary decision in controlling procedure may be based on the test stated in House v. R (1936) 55 CLR 499 at 504 - 505; but that is not the only basis on which the Presidential member may act. The powers of a Presidential member on review are somewhat wider and extend to power to reopen consideration of a matter of which an Arbitrator has disposed; the manner in which the powers of the Presidential member are to be exercised is itself the subject of discretion of the Presidential member.”
This passage was recently quoted with approval by McColl JA in South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16 at [134] (‘Edmonds’). To describe the relative weight and relevance of the expert evidence as “a discretionary decision which could only be disturbed on House v The King principles” was described by McColl JA as “an over-generalisation” (at [133]).
Before an Arbitrator’s decision will be revoked on review it must by demonstrated that it contains or has resulted from an error of fact, law or discretion. The error must be such that, but for it, a different decision should have been made (see Snow Confectionary Pty Ltd v Askin [2004] NSWWCCPD 56; Section 294 of the 1998 Act; YG & GG v Minister for Community Services [2002] NSWCA 247; Absolon v NSW TAFE [1999] NSWCA 311).
I intend to apply the above principles in the matter before me.
APPREHENDED BIAS
Background
During the hearing Mr Thorne, the Respondent Employer’s solicitor, sought and was given leave to cross-examine Mr Cullen “on the history and basically the credit of the applicant” and also on the issue of whether Mr Cullen had been looking for work (T18.22). After having unsuccessfully tried to read to Mr Cullen a part of Mrs Hawke’s statement of 16 October 2003 (T20.5), Mr Thorne put to Mr Cullen that he made no complaint of injury on his last day at work, 10 September 2003. Mr Cullen denied that suggestion and said he complained to Mrs Hawke at lunchtime on that day that he could not do any more lawn mowing because his back was aching (T21.5). Mr Cullen was then cross-examined at T22 about the history he gave to Dr McGroder, occupational health physician qualified by the Respondent Employer, and about potential alternative employment (T23). It was suggested that Mr Cullen was exaggerating his symptoms (T22.53).
At the conclusion of Mr Thorne’s cross-examination the Arbitrator asked several questions (T23.55 to T26.9) about the circumstances in which Mr Cullen reported his injury to Mrs Hawke and the circumstances in which he ceased work.
Mr Thorne then commenced his submissions and at T28.25 said:
“According to the statement of Dorothy Hawke, he made no complaint of injury - sorry, that he was suffering any pain on that day. He was given the - he was handed the termination letter, which was effective from 17 September--”
The Arbitrator interrupted Mr Thorne and said, “Mr Thorne your [sic] not suggesting, are you, that there was no injury on that day?” There was then a brief discussion about the correct date of injury and the following exchange occurred at T29.2:
“ARBITRATOR: Yeah. So, that’s why I asked you I hope you’re not suggesting by your submission that there was no injury. Notwithstanding the strength of the evidence on your side, that was not made an issue before it went to an AMS --
MR THORNE: No.
ARBITRATOR: -- and you cannot, therefore, raise it now, although, as I say, there is a lot of evidence that supports it, but it’s not something that I can concern myself with.
MR THORNE: The relevance - I appreciate that. What my point is – it’s all - my issue there - my point is credit. My –
ARBITRATOR: Yes, but, I mean, how far can your credit argument go? You cannot say that he is not to be believed and he’s never had an injury, notwithstanding the suspicious circumstances under which he came to complain about the injury later, because you’ve already accepted he did have an injury. You didn’t bring it up at the time of the referral to the AMS, and under Wikaira and other decisions recently coming down from the Supreme Court, you cannot now say that there was no injury. As I understood your submission at the start of the day, you don’t say that.
MR THORNE: I don’t say that. What I --
ARBITRATOR: Is your credit submission simply that the applicant is not to be believed when he says he can’t do all these jobs that have been put before him?
MR THORNE: That is one --
ARBITRATOR: I can understand that.
MR THORNE: I’m not saying he didn’t have an aggravation or an injury on 10 September. What my point is is that it goes to credit. What my point is – I’m suggesting – I’m submitting that he did not report - sorry, I’ll certainly – I’ll go back to sort of that injury. Okay. My point is the applicant denies having conversations with - sorry, he states he has a conversation with Dorothy Hawke on 10 September in relation to a matter. Dorothy Hawke says to the contrary. That’s all I’ll say there.
ARBITRATOR: Well, if I can ask you this: is it your submission that the - your attack on the applicant’s credit can only result in a finding by the Commission that he does tend to exaggerate, that he might be a little bit obsessed with his injury and that, in fact, he is capable of doing the work that’s suggested by your experts that he can do despite his protestations that he can’t? I don’t see how you can take it any further than that.
MR THORNE: No, I won’t take it any further.
ARBITRATOR: Is there anything else you want to say?
MR THORNE: In relation to that or --
ARBITRATOR: Anything.”
Mr Thorne then made submissions about Mr Cullen’s capacity to earn in alternative employment. At T31.14 there was a short adjournment. It is alleged that when the recording equipment was turned off the Arbitrator made certain comments to the parties and their legal advisers. Those comments resulted in Mr Cullen’s counsel, Mr Hanlon, making an application upon the resumption of the hearing that the Arbitrator disqualify himself on the ground of apprehended bias (T31.23). It is agreed that the transcript is in error at T31.23 where it refers to “applicant bias”.
In the absence of a transcript of what the Arbitrator said in the adjourned period, I issued the following direction to the parties on 21 June 2007:
“In light of the Appellant Worker’s submission that the Arbitrator should have disqualified himself on the ground of apprehended bias and the fact that it is alleged that the transcript of the proceedings before the Arbitrator on 20 February 2007 is incomplete, the following direction is made:
1.The parties are directed to file and serve on or before 4.30pm on Friday 20 July 2007 an affidavit or affidavits setting out the statements allegedly made by the Arbitrator that have not been recorded in the transcript and when in the course of the proceedings those words were spoken and what, if any, response was made by the parties’ legal representatives at the time.
2.If it is alleged that the transcript has not recorded all of the parties’ submissions (see transcript page 50 line seven), the parties are directed to file and serve on or before 4.30pm on Friday 20 July 2007 a summary of the submissions that were made but not transcribed.”
In response to the above direction an affidavit from Mr Cullen’s solicitor, Kelly Maidla, sworn 19 July 2007, was filed on 20 July 2007. Ms Maidla’s affidavit sets out at paragraphs 8 to 11 her recollection of the exchange that took place between the Arbitrator, Mr Thorne and Mr Hanlon during the short pause noted on the transcript at T31.14. Subject to deleting the Arbitrator’s name, her affidavit reads:
“8.Then I recall there was a conversation during which words to the effect of the following were said:
‘[Arbitrator]: Is injury in dispute?
Thorne:No
[Arbitrator]: If injury was in dispute, I would have found against the Applicant.’
9.[The Arbitrator] then looked at some documents in front of him which apparently noted the agreed dates of injury.
10.I recall that there was then a further conversation in which words to the effect of the following were said:
‘[Arbitrator]: The law stops me – if you’ve agreed with that Mr Thorne there is nothing I can do.’
[The Arbitrator] then spoke to Mr Hanlon and said:
‘If there is some money on the table you should seriously consider it’.
Hanlon:‘There is no reasonable offer on the table. We haven’t had a chance to address – there is another side to this case and we need to address on the circumstances of the injury.’
11.I recall that at some point during these conversations [the Arbitrator] said words to the effect of ‘We’ll go into conciliation’.
12.The matter was then adjourned for a short time. During the adjournment, Mr Hanlon took instructions from the Applicant.”
The Respondent Employer sought to file two affidavits, one from Mr Thorne sworn on 20 July 2007 and one from Mr Carver, a director of the Respondent Employer, sworn on 17 July 2007. Mr Hanlon objected to Mr Carver’s affidavit on the ground that it did not attempt to set out the conversation that took place during the adjourned period but merely gave his opinion of the general effect of that conversation. At the oral hearing on appeal, I upheld Mr Hanlon’s objection and rejected Mr Carver’s affidavit (which has been placed with the appeal papers) as I found it to be of no probative value in determining the issues on appeal. Mr Thorne’s affidavit was admitted into evidence by consent.
Mr Thorne’s affidavit states at paragraph five:
“5.Towards the end of my submissions, the Arbitrator informed the parties that there was going to be a short break and then said, to my best recollection, words to the following effect:
‘I will now go back into the conciliation phase. At this stage, I have not determined this matter however, having heard the oral evidence of the applicant and having read the medical reports, I suggest the applicant may wish to consider any offers of settlement made by the respondent.’
6.The Arbitrator left the room and I shortly followed with Mr and Mrs Caver, leaving the applicant with his legal advisers. There was a break of appropriately ten minutes and the matter resumed in accordance with the transcript.”
Discussion and Findings
There can be no doubt that a Commission Arbitrator must act in accordance with the obligations of procedural fairness and natural justice and must observe the recognised standards of judicial fairness (Edmonds at [91]). The rule in relation to apprehended bias forms one part of the rules of natural justice. In Minister for Immigration and Multicultural Affairs v Jia Legeng (2001) 205 CLR 507 (‘Jia Legeng’) at [136] Kirby J noted that the rule:
“…adapts to the nature and significance of the decision concerned, the character of the office of the decision-maker and the requirements, express or implied, of any legislation applicable to the case.”
The question of what constitutes apprehended bias was considered by the High Court in Johnson v Johnson (2000) 201 CLR 488 (‘Johnson’) where it was held in a joint judgment by Gleeson CJ, McHugh, Gummow and Hayne JJ at [11] and [12]:
“It has been established by a series of decisions of this Court that the test to be applied in Australia in determining whether a judge is disqualified by reason of the appearance of bias (which, in the present case, was said to take the form of prejudgment) is whether a fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial and unprejudiced mind to the resolution of the question the judge is required to decide.
That test has been adopted, in preference to a differently expressed test that has been applied in England [cf Locabail (UK) Ltd v Bayfield Properties Ltd [2000] QB 451], for the reason that it gives due recognition to the fundamental principle that justice must both be done, and be seen to be done [cf R v Sussex Justices; Ex parte McCarthy [1924] 1 KB 256 at 259 per Lord Hewart CJ]. It is based upon the need for public confidence in the administration of justice. ‘If fair-minded people reasonably apprehend or suspect that the tribunal has prejudged the case, they cannot have confidence in the decision’ [R v Watson; Ex parte Armstrong (1976) 136 CLR 248 at 263]. The hypothetical reasonable observer of the judge’s conduct is postulated in order to emphasise that the test is objective, is founded in the need for public confidence in the judiciary, and is not based purely upon the assessment by some judges of the capacity or performance of their colleagues. At the same time, two things need to be remembered: the observer is taken to be reasonable; and the person being observed is ‘a professional judge whose training, tradition and oath or affirmation require [the judge] to discard the irrelevant, the immaterial and the prejudicial’ [Vakauta v Kelly (1988) 13 NSWLR 502 at 527 per McHugh JA, adopted in (1989) 167 CLR 568 at 584-585 per Toohey J].” (emphasis added)
In Re JRL; Ex parte CJL (1986) 161 CLR 342, a case concerning apprehended bias, Mason J (as his Honour then was) said at 352:
“It needs to be said loudly and clearly that the ground of disqualification is a reasonable apprehension that the judicial officer will not decide the case impartially or without prejudice, rather than that he will decide the case adversely to one party. There may be many situations in which previous decisions of a judicial officer on issues of fact and law may generate an expectation that he is likely to decide issues in a particular case adversely to one of the parties. But this does not mean either that he will approach the issues in that case otherwise than with an impartial and unprejudiced mind in the sense in which that expression is used in the authorities or that his previous decisions provide an acceptable basis for inferring that there is a reasonable apprehension that he will approach the issues in this way. In cases of this kind, disqualification is only made out by showing that there is a reasonable apprehension of bias by reason of prejudgment and this must be ‘firmly established’ (Reg. v. Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546, at pp 553-554; Watson, at p 262; Re Lusink; Ex parte Shaw (1980) 55 ALJR 12, at p 14; 32 ALR 47, at pp 50-51). Although it is important that justice must be seen to be done, it is equally important that judicial officers discharge their duty to sit and do not, by acceding too readily to suggestions of appearance of bias, encourage parties to believe that by seeking the disqualification of a judge, they will have their case tried by someone thought to be more likely to decide the case in their favour.” (emphasis added)
It is not sufficient if a reasonable bystander “has a vague sense of unease or disquiet” (Jones v Australian Competition & Consumer Commission (2002) 76 ALD 424 (‘Jones’)).
The above principles were considered by the NSW Court of Appeal in Kwan v Kang & 2 Ors [2003] NSWCA 336 (‘Kwan’), a case concerning apprehended bias on the ground of pre-judgment, where in a unanimous decision the Court said at [83]:
“There must be a reasonable apprehension on the part of the fictitious observer that the decision-maker’s mind is so prejudiced in favour of a conclusion already formed that he or she might not alter that conclusion, irrespective of the evidence or arguments presented to him or her (see the approach expressed in Laws v Australian Broadcasting Tribunal at 100, varied in the light of Johnson v Johnson).”
In Jia Legeng Gleeson CJ and Gummow J said at [71] and [72]:
“…Decision-makers, including judicial decision-makers, sometimes approach their task with a tendency of mind, or predisposition, sometimes one that has been publicly expressed, without being accused or suspected of bias. The question is not whether a decision-maker’s mind is blank; it is whether it is open to persuasion. The fact that, in the case of judges, it may be easier to persuade one judge of a proposition than it is to persuade another does not mean that either of them is affected by bias.
...The state of mind described as bias in the form of prejudgment is one so committed to a conclusion already formed as to be incapable of alteration, whatever evidence or arguments may be presented. Natural justice does not require the absence of any predisposition or inclination for or against an argument or conclusion.” (footnotes omitted)
Mr Hanlon submits that the principles discussed in the above passages from Jia Legeng apply only to matters where actual bias is alleged. It is true that the first passage was in the context of the test adopted by the Federal Court for actual bias. The second passage, however, makes an express reference to Johnson, a case concerned only with apprehended bias, and is expressed in language very similar to that used by the Court of Appeal in Kwan quoted at [35] above. In addition, in Jia Legeng Hayne J said at [185] and [186]:
“Saying that a decision-maker has prejudged or will prejudge an issue, or even saying that there is a real likelihood that a reasonable observer might reach that conclusion, is to make a statement which has several distinct elements at its roots. First, there is the contention that the decision-maker has an opinion on a relevant aspect of the matter in issue in the particular case. Secondly, there is the contention that the decision-maker will apply that opinion to that matter in issue. Thirdly, there is the contention that the decision-maker will do so without giving the matter fresh consideration in the light of whatever may be the facts and arguments relevant to the particular case. Most importantly, there is the assumption that the question which is said to have been prejudged is one which should be considered afresh in relation to the particular case.
Often enough, allegations of actual bias through prejudgment have been held to fail at the third of the steps I have identified. In 1894, it was said that [136]:
‘preconceived opinions - though it is unfortunate that a judge should have any - do not constitute such a bias, nor even the expression of such opinions, for it does not follow that the evidence will be disregarded’. (emphasis added)
Allegations of apprehended bias through prejudgment are often dealt with similarly[137].” (emphasis added)
The case cited by Hayne J in respect of allegations of apprehended bias through prejudgment often being dealt with “similarly” is Johnson at [13] where the majority of the High Court said:
“Whilst the fictional observer, by reference to whom the test is formulated, is not to be assumed to have a detailed knowledge of the law, or of the character or ability of a particular judge [9], the reasonableness of any suggested apprehension of bias is to be considered in the context of ordinary judicial practice. The rules and conventions governing such practice are not frozen in time. They develop to take account of the exigencies of modern litigation. At the trial level, modern judges, responding to a need for more active case management, intervene in the conduct of cases to an extent that may surprise a person who came to court expecting a judge to remain, until the moment of pronouncement of judgment, as inscrutable as the Sphinx. In Vakauta v Kelly[10] Brennan, Deane and Gaudron JJ, referring both to trial and appellate proceedings, spoke of ‘the dialogue between Bench and Bar which is so helpful in the identification of real issues and real problems in a particular case.’[11] Judges, at trial or appellate level, who, in exchanges with counsel, express tentative views which reflect a certain tendency of mind, are not on that account alone to be taken to indicate prejudgment. Judges are not expected to wait until the end of a case before they start thinking about the issues, or to sit mute while evidence is advanced and arguments are presented. On the contrary, they will often form tentative opinions on matters in issue, and counsel are usually assisted by hearing those opinions, and being given an opportunity to deal with them.” (emphasis added)
In referring to the comments made by the trial judge in Johnson, the majority said at [18]:
“When what Anderson J said is considered in its context, and in the light of his subsequent explanation, the argument for the appellant must fail. The judge was not to be understood as intending to express a concluded view on the credibility of either party. In particular, he was not to be understood as intending to express such a view about the credibility of the appellant, who had not yet been called to give evidence. His expectation as to the importance of independent evidence, and documentary material, was understandable [14]. An apprehension that he had formed a concluded view on the credibility of witnesses, and would not bring an open mind to bear when he decided the case, would have been unwarranted and unreasonable.” (emphasis added)
In Johnson the trial judge said, before he had heard any evidence from the appellant, that he would be relying on witnesses other than the parties and independent documents in determining where the truth lay.
In Antoun v R [2006] HCA 2 (‘Antoun’) the trial judge expressed his conclusion as to the outcome of a ‘no case’ submission before hearing any argument on either the facts or the law. The High Court held that the judge should have disqualified himself on the ground of apprehended bias. Kirby J held at [29] and [30]:
“A line is drawn between forthright and robust indications of a trial judge’s tentative views on a point of importance in a trial and an impermissible indication of prejudgment that has the effect of disqualifying the judge from further conduct of the proceedings. Sometimes, that line will be hard to discern. But, in this case, I agree with the other members of this Court that the trial judge crossed it.
The most powerful evidence that he did so appears from the record. He expressed his conclusion as to the outcome of a submission before hearing any argument from the appellants, whether on the facts or the law. Every judge of experience knows that pertinent facts can be forgotten or mistaken. As well, the law can be misunderstood or an aspect of it overlooked. Some opportunity should therefore have been given to counsel to develop their submissions, if necessary in writing, prepared overnight. The repeated insistence that any submissions would not bear fruit and the later unrequested, unargued revocation (or non-continuance) of bail reinforced the conclusion initially given. The line was crossed. The trial judge thereby disqualified himself.” (emphasis added)
In the same case Hayne J held at [56]:
“For the moment, what is determinatively significant is that the trial judge said that a submission of no case to answer would be rejected without knowing what form that submission would take and without knowing in even the broadest outline what was said to be its basis. And having said that the submission would be rejected, the trial judge, after the case had been adjourned overnight, went out of his way when the case resumed to emphasise to counsel that he had meant what he had said. It was inevitable that a fair-minded lay observer might reasonably apprehend in this case that the judge might not bring an impartial mind to the resolution of the question that the judge was required to decide on the no case submission. And without knowing whether the no case submission would take the form of pointing to some alleged deficiency in the prosecution proofs or instead be directed to the weight of the evidence advanced by the prosecution, it was inevitable that the fair-minded lay observer might reasonably apprehend that the judge might not bring an impartial mind to the resolution of the final questions that the judge was called on to decide in the trial.”
The principles governing apprehended bias were discussed again by the High Court in Ebner v Official Trustee in Bankruptcy (2000) 205 CLR 337 where Gleeson CJ, McHugh, Gummow and Hayne JJ said at [7]:
“The apprehension of bias principle may be thought to find its justification in the importance of the basic principle, that the tribunal be independent and impartial. So important is the principle that even the appearance of departure from it is prohibited lest the integrity of the judicial system be undermined. There are, however, some other aspects of the apprehension of bias principle which should be recognised. Deciding whether a judicial officer (or juror) might not bring an impartial mind to the resolution of a question that has not been determined requires no prediction about how the judge or juror will in fact approach the matter. The question is one of possibility (real and not remote), not probability. Similarly, if the matter has already been decided, the test is one which requires no conclusion about what factors actually influenced the outcome. No attempt need be made to inquire into the actual thought processes of the judge or juror.” (emphasis added)
The Court of Appeal has recently considered the question of actual bias in Edmonds. In that matter it was argued that the Arbitrator showed actual bias in the form of prejudgment when he encouraged the worker to amend her claim to allege the relevant disease provisions and he said, immediately before delivering his decision, “I think I’ve indicated from the outset that I’ve got a certain view” (Edmonds at [103]). McColl JA noted at [103] “the critical question is whether he [the Arbitrator] had so prejudiced the matter as to be incapable of altering his view, whatever evidence or arguments may be presented”.
In the course of deciding that question her Honour made a number of important observations (with Giles and Tobias JJA agreeing) about the principles relating to bias (both apprehended and actual) and how those principles apply to proceedings in the Commission. Those observations have particular relevance in the present matter and may be summarised as follows:
a)the conduct of the decision maker must be considered in the context of the nature of the decision making process in which he or she is engaged (Edmonds at [103] citing Jia Legeng at [78]);
b)a judicial officer has never been required to approach a case with a blank mind. An Arbitrator is required to consider the “substantial merits of the case” (section 354(3) of the 1998 Act and Edmonds at [104]);
c)an Arbitrator’s first task at the initial teleconference is to use his best endeavours to bring the parties to a settlement acceptable to them before determining any dispute (section 355 of the 1998 Act and Edmonds at [104]);
d)an Arbitrator has an “overall and continuing duty” (Aluminium Louvres & Ceiling Pty Limited v Xue Qin Zheng [2006] NSWCA 34 at [25]) to use his or her best endeavours to bring the parties to a settlement by identifying issues and practical solutions to those issues (Edmonds at [104]);
e)“the nature of the jurisdiction the Arbitrator was exercising made it obligatory that he form a view about the issues” (Edmonds at [105]);
f)in assessing whether a decision-maker has been guilty of actual or apprehended bias, it is necessary to consider the extent to which that person is constrained from taking into account an opinion formed in the course of undertaking his or her task (Edmonds at [106] referring to Hayne J in Jia Legeng at [187]);
g)while a Commission Arbitrator is obliged to act impartially, he or she is entitled, in discharging the decision making function to take into account views he or she has formed in the course of discharging the primary role of achieving a settlement acceptable to both parties (section 355(1) of the 1998 Act) (Edmonds at [106]), and
h)the requirements of natural justice are not infringed by a mere lack of nicety (Edmonds at [110] citing R v Commonwealth Conciliation & Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 at 553).
In concluding that the bias ground of appeal should be rejected, McColl JA noted:
a)the Arbitrator heard submissions from the appellant, gave detailed reasons analysing the medical evidence and considered both parties’ cases [107];
b)the transcript did not indicate that the parties were not afforded the opportunity to present their cases [110], and
c)the fact that the Arbitrator did not seek submissions from the worker was of no moment [110].
Applying the above principles to the present matter the first observation to be made is that there is no agreement about what the Arbitrator said in the short adjournment under consideration. Mr Hanlon first raised the allegation of apprehended bias at T31.23. When pressed as to the basis for the application Mr Hanlon said at T31.58:
“MR HANLON: Well, the application is made on the basis that before you’ve had an opportunity to properly look at the material and before I’ve had a chance to address you on the material, you made certain observations regarding the way in which you would determine issues in the applicant’s case.”
The Arbitrator replied that he had made observations that the Respondent Employer could not “challenge the provision [sic] of injury notwithstanding that, in my view, there’s a very strong case for that challenge” (T32.8). The following exchange then took place:
“MR HANLON: And your observation is gratuitous.
ARBITRATOR: My observation was intended to assist all the parties as to the way I’m thinking, having read the papers, heard the evidence and now halfway through the --
MR HANLON: The observation is gratuitous.
ARBITRATOR: -- the respondent’s submissions. The only thing I’ve yet to hear, and I can still be persuaded, are your submissions, Mr Hanlon. Gratuitous in so far as they relate to something that I cannot do maybe, but still it may raise in your mind the question that I’m not entirely satisfied as to the protestations of your client as to what he can and can’t do. To that extent, the credit issue is very much alive.
MR HANLON: Well, it goes further than that. Your comment goes further than that. It strikes at the very veracity of the claim itself and also --
ARBITRATOR: True.
MR HANLON: -- the veracity of this witness.
ARBITRATOR: I agree.
MR HANLON: And it was a gratuitous comment.
ARBITRATOR: Well, I don’t think it’s gratuitous. I think it’s very relevant to the issues that I have to decide now.
MR HANLON: In any event, the test is: would a reasonable person apprehend that you were biased in making that comment? My submission is that a reasonable person would, and on that basis I would ask you to disqualify yourself from the hearing of this matter.
ARBITRATOR: Anything else?MR HANLON: No.” (emphasis added)
The Arbitrator then gave reasons at T33.6 for rejecting the application that he disqualify himself:
“ARBITRATOR: Mr Hanlon asked me to disqualify myself because I have made it clear at this stage of the proceedings the way in which I apprehend the case. I decline to disqualify myself on the basis of the comments I have made, which follow an analysis of the evidence as it has been identified in the process, which is on the tape. Hence, on my observations of the applicant when giving evidence and my assessment of, as I say, the material before me, which I have already looked at, in particular the question of the diagnosis and the incapacity that flows from that.
The comments I have made I’ve made late in the case that are done for the assistance of the parties would indicate the direction, if you like, the case has taken and to give an opportunity to the parties to see if there is any opportunity for conciliation at this late stage. An objective bystander, I think, would be of the view that I have formed a view at this stage of the proceedings as to which side of the record I prefer. [Inaudible] Mr Hanlon, the only matter that has to complete the case are his submissions, and I indicated my position to him so that he may either see if he can resolve the matter at this stage or, if not, he certainly knows the area which he has to address and the areas which concern me about his client’s case.
At this stage of the proceedings, such expressions that I’ve made I do not regard as being biased - that is to say, putting forward a preference for one side or the other with no justification whatsoever - and it is difficult, even if I had made such comments at the start of the case before anyone had said a word, to establish real or apprehended bias bearing in mind the process by which the Commission conducts its business, and that is the famous ‘front-end-loaded’ procedure whereby the Arbitrators obtain the case on both sides of the record in document form before the case starts, and then the Arbitrators are required to read it and, indeed, encouraged to form a view as to the matters, the issues arising in the case and, indeed, in many cases are encouraged to not hear from the parties but simply deal with the matter on the papers. That puts an application such as comes from Mr Hanlon in - gives it some difficulties. My having expressed my views at the end of the case, having heard the witness and having gone through the papers yet again, I decline to disqualify myself. Yes, Mr Thorne.”
The Arbitrator clearly agreed that his comments indicated that he had ‘formed a view’ as to which side of the record he preferred. That concession seems to me to indicate that the disputed comments were more likely to accord with Ms Maidla’s recollection rather than Mr Thorne’s. Mr Thorne’s version does not exclude the possibility that the Arbitrator spoke the words attributed to him by Ms Maidla. In addition, the Respondent Employer made no challenge to the assertions in the Appellant Worker’s submissions filed on 20 March 2007, which detailed the nature of the comments allegedly made by the Arbitrator. Having regard to the whole of the material before me I find that, on the balance of probabilities, the Arbitrator did say words to the effect of those set out in Ms Maidla’s affidavit. The question is: what flows from that fact?
I have to determine if “a fair-minded lay observer might reasonably apprehend that the judge [arbitrator] might not bring an impartial and unprejudiced mind to the resolution of the question the judge is required to decide” (Johnson at [11]). To determine if an arbitrator’s mind is impartial it is necessary to bear in mind that arbitrators are entitled to form tentative views on “matters in issue” (emphasis added) (Johnson at [13] and Edmonds at [105]) and that the Commission’s arbitrators have a continuing obligation to use their best endeavours to bring the parties to a settlement (section 355 of the 1998 Act). The question is, will the arbitrator “bring an open mind to bear” (Johnson at [18]) when he or she comes to deciding the issues in dispute. In determining that question it is appropriate to take into account the arbitrator’s subsequent conduct and statements (Johnson at [14]).
Mr Hanlon relies heavily on the Arbitrator’s comment at T32.27 where he said “Gratuitous in so far as they relate to something that I cannot do maybe” (emphasis added) and submits that the Arbitrator’s comment indicates that he was conceding that he could not find against Mr Cullen on injury but he may still be able to make another finding (of no incapacity) which would have the same effect, namely, Mr Cullen would receive no compensation. I do not accept this submission. The use of the word ‘maybe’ was ambiguous. It may merely have been an expression of doubt about whether the injury issue had been conclusively determined. It may have been a statement by the Arbitrator that whilst injury was not in issue, other issues, such as Mr Cullen’s credit, were in issue and those issues were troubling him and he was bringing those matters to the parties’ attention. I am not satisfied that a reasonable lay observer would give the word the meaning suggested by Mr Hanlon.
The Arbitrator’s comments, by his own admission, indicated a clear preference for one side of the record (T33.25). His statement that he indicated his position “so that he [Mr Hanlon] may either see if he can resolve the matter at this stage or, if not, he certainly knows the area which he has to address and the areas which concern me about his client’s case” (T33.27), does not follow from the words used by him during the adjournment. Mr Hanlon argues that those words (as set out in Ms Maidla’s affidavit at [28] above) went to a matter (injury) that the Respondent Employer conceded was not in issue. Therefore, it is argued, the comments were gratuitous (“being without reason, cause, or justification”: see The Macquarie Dictionary, second edition, page 766) and this fact strengthens the apprehension of bias. I agree with this submission. I have some trouble seeing how comments about a matter not in issue could assist the parties in resolving their differences or in directing Mr Hanlon to the areas he had to address. He did not have to address on injury. The words attributed to the Arbitrator went well beyond ‘identifying the issues and practical solutions to them’ (see Guidelines for the Practice of the Conciliation/Arbitration Process, November 2006 at page seven). They indicated that had a decisive matter on liability (injury) been in dispute, the Arbitrator would have found against Mr Cullen on that issue. The result of such a finding (had it been open to the Arbitrator) would have been an award for the Respondent Employer.
The Arbitrator’s subsequent conduct indicates that he heard submissions from the parties and gave detailed reasons for his ultimate findings. In many cases that may be sufficient to dispel any concerns of apprehended bias, as it will often indicate that the Arbitrator is open to be persuaded. In the circumstances of the present case, however, I do not believe that those factors were sufficient to remove the impression of apprehended bias created by the Arbitrator’s comments. The Arbitrator agreed with Mr Hanlon that his comments struck “at the very veracity of the claim itself” (emphasis added) (T32.35-38). Thus the comments did not merely go to credit but went to the question of whether Mr Cullen had sustained an injury and, therefore, whether he had an entitlement to any compensation. The Arbitrator expressed a concluded view on a decisive matter that was not in issue. In a case where injury was not in dispute, I cannot imagine a lay observer taking any view other than that the Arbitrator had already formed an adverse view about Mr Cullen’s entitlement to compensation.
The Arbitrator’s statement that he was indicating to Mr Hanlon the areas on “which he has to address and the areas which concern me about his client’s case” (T33.29) did nothing to diminish the adverse impression created by the comments made during the adjournment but, in my view, only served to confirm the apprehension that the Arbitrator had prejudged Mr Cullen’s entitlement to compensation and would therefore not bring an impartial mind to bear on the issue of incapacity. If the Arbitrator was concerned about Mr Cullen’s credit, and he felt that the question of settlement needed to be further explored, it would have been appropriate for him to suggest to the parties that they may wish to resume negotiations. He went much further than that. He expressed an extremely damaging and prejudicial view about the very basis of Mr Cullen’s entitlement to compensation and his subsequent comments did nothing to withdraw or qualify his earlier statements. Therefore, I believe that a fair-minded lay observer would reasonably have apprehended that the Arbitrator might not bring an impartial mind to the resolution of the dispute before him. This conclusion is reinforced when one considers the Arbitrator’s subsequent comments discussed at [54] above.
In reaching the above conclusion I have given careful consideration to the Respondent Employer’s submissions. For the reasons outlined above, I do not accept its argument that the interests of justice were served by the Arbitrator’s comments or conduct. The actions taken by the Arbitrator went well beyond affording Mr Cullen the opportunity “to consider that it was not perhaps in his best interests to allow the matter to proceed to a formal determination” (Respondent Employer’s submissions paragraph 15).
The end result is that the Arbitrator should have disqualified himself on the ground of apprehended bias. This conclusion requires that the Arbitrator’s determination be revoked and that the matter be remitted to a different Arbitrator for re-determination. If I am wrong on the issue of apprehended bias, it is appropriate that I also consider the issue of incapacity.
INCAPACITY
The Arbitrator found that from 4 May 2006 Mr Cullen was fit to perform sales work (in hardware supplies), handyman work with certain restrictions and the work of a courier (T59.54). He relied on the report of Mr Brown, consultant in ergonomics and occupational psychologist, to find Mr Cullen was capable of earning $735.00 per week as a handyman and $593.00 per week as a courier. As Mr Cullen’s pre-injury earnings were only $480.00 the Arbitrator found that he sustained no economic loss and made an award for the Respondent Employer.
The Appellant Worker submits:
a)Mr Brown’s evidence was that the 5kg lifting restriction recommended by Mr Cullen’s doctors was “somewhat restrictive” but any “light job which involved the need for some manual skill but without excessive training would be appropriate for him” (report Mr Brown 3 October 2006, page eight);
b)Mr Brown did not take into account other restrictions accepted by Dr McGroder which further reduced the range of handyman activities available to Mr Cullen;
c)Mr Brown surmised that Mr Cullen could run a caravan park with his wife doing the office work. The medical evidence was that Mr Cullen was not fit for that work;
d)Mr Cullen’s pre-injury earnings were only $480.00 per week as a handyman. In these circumstances it is impossible to understand how he would now be capable of earning $735.00 per week;
e)Mr Brown did not take properly into account the restrictions imposed on Mr Cullen’s work capacity by Dr McGroder;
f)The Arbitrator did not give proper consideration to ‘suitable duties’ in section 43A of the 1987 Act and had he done so he would not have accepted that Mr Cullen could earn $735.00 per week;
g)Mr Brown had no expertise on which to base his opinion that the 5kg lifting limit would be manageable as a courier;
h)there was no evidence that the courier work available in the Batemans Bay area could be limited to weights of 5kg or less;
i)there was no evidence that reasonable loading and unloading arrangements were in place for couriers in the Batemans Bay area;
j)a courier would have to lift a trolley into and out of a vehicle and there was no evidence as to the weight of such trolleys;
k)the fact that reasonable loading and unloading arrangements would require a trolley suggests that, in fact, weights over 5kg would have to be loaded and unloaded from time to time;
l)the use of a trolley would not by itself alleviate lifting;
m)there was no evidence that courier work for Mr Cullen could be restricted to driving for no more than 40kms;
n)it was pure speculation that Mr Cullen could earn $593.00 per week as a courier;
o)the Arbitrator made no finding as to what Mr Cullen could earn in sales, and
p)the restrictions identified by Dr McGroder would impinge significantly upon Mr Cullen’s ability to perform ‘suitable’ duties having regard to the terms of section 43A of the 1987 Act in the unlikely event that such work was available to him.
The Respondent Employer submits:
a)to succeed the Appellant Worker has to establish that it is “manifestly obvious” that the Arbitrator’s discretion miscarried (see Department of Education and Training v Mekhail [2006] NSWWCCPD 1 and Knight v Eyles Nominees Pty Ltd [2004] NSWWCCPD 73;
b)the Arbitrator’s reasons demonstrate that his determination and any discretion he exercised were entirely consistent with and available on the evidence;
c)the Arbitrator rejected the evidence of Dr Murray;
d)the Arbitrator was correct in finding that Mr Cullen was capable of working as a handyman or courier and earning $735.00 and $593.00 per week respectively;
e)the Arbitrator accepted Dr McGroder’s assessment that Mr Cullen could manage three different types of jobs: sales, hanyman with restrictions and courier work (T59.39) and it was open to him to do so, and
f)the appeal should be dismissed.
The Appellant Worker does not challenge the Arbitrator’s acceptance of Dr McGroder’s assessment and it is on the basis of that assessment that I approach whether the Arbitrator was in error in his findings under section 40 of the Workers Compensation Act 1987 (‘the 1987 Act’). Dr McGroder noted the following in his report of 5 October 2006:
a)Mr Cullen left school at the end of year nine and completed 12 months of boilermaker’s apprenticeship but the employer’s business failed and the apprenticeship was not completed;
b)Mr Cullen has always worked as a handyman or in kitchens, welding factories, furniture factories or bars. He has an interest in assembling model cars and motorbikes;
c)the CT of 1 October 2003 suggested a L5/S1 spondylolisthesis with pars defects;
d)Mr Cullen said he always had some degree of low back pain which increased or decreased depending upon aggravating factors such as standing or sitting for too long and straining the back. If he sat for long periods he got pins and needles down the back of his left thigh to just past the knees;
e)exercise with an exercise physiologist for three months in 2006 did not help his pain;
f)his medication included mobic, panadeine forte and avanza;
g)Mr Cullen has non specific low back pain and as there was a good deal of subjectivity in his symptoms it was difficult to quantify his back pain;
h)Mr Cullen was unfit for his pre-injury work as a “yardsman” [sic] because of the unpredictable nature of the physical aspects of that work but he was fit for lighter work on a full-time basis with a lifting limit of 5kg and “he should avoid the maintenance of fixed or awkward positions of the back” (report Dr McGroder 5 October 2006, paragraph 17.1);
i)no injury management plan has been approved;
j)Mr Cullen’s latest medical certificate from Dr Murray suggested a 5 kg lifting limit with a 20 minute limit on walking, sitting and standing;
k)Mr Cullen was fit to perform the following suitable duties: sales, handyman within the restrictions outlines above and courier, which Dr McGroder described as “potential job options”, and
l)“sales” was an area of work Mr Cullen could perform, with training.
Based on Dr McGroder’s assessment and findings, Mr Brown conducted an assessment of what ‘suitable work’ Mr Cullen could perform within the meaning of section 40 of the 1987 Act. Mr Brown noted the following in his report of 3 October 2006:
a)when in his 20’s Mr Cullen completed a hospitality course, bar service course, traffic control course, welding course and telephone answering course;
b)Mr Cullen has always been in work until his injury and the last three years out of work have been very difficult for him;
c)he tried to lift more than 5 kg on one occasion, but his back ‘went’ and he was laid up for two weeks;
d)Mr Cullen appeared depressed but was psychologically able to work;
e)he did not want to work in pubs;
f)he wanted to be trained as a car salesman or in furniture sales, television and entertainment sales or “anything where he does not have to dig holes”;
g)he is good at all handyman jobs other than electrical work and would like to do an electrical course so as to complete his skills;
h)he would need some training to work in sales but it could probably be on-the-job training. Hardware sales would be the logical starting point;
i)a comparable wage earner to Mr Cullen employed as a handyperson could expect to earn $732.00 per week in the Batemans Bay region;
j)he does not have sales experience however has extensive experience working as a handyman and performing other semiskilled work. As to his physical tolerances, “it would seem that he does best if the job involves 15 to 20 minutes of standing, with the ability to sit for a shorter period after that, followed by standing once again.” (report Mr Brown 3 October 2006, paragraph 10.1);
k)handyman work is work that Mr Cullen has performed most of his working life but the 5kg weight limit is somewhat restrictive, but a range of handyman jobs could be performed, and
l)the 5kg weight limit would be manageable as a courier as there is a range of courier and delivery work in which items to be handled are no heavier than that weight or in which trolleys can be used.
Section 43A of the 1987 Act provides:
“43A Suitable employment
(1) For the purposes of sections 38, 38A and 40:
‘suitable employment’, in relation to a worker, means employment in work for which the worker is suited, having regard to the following:(a) the nature of the worker’s incapacity and pre-injury employment,
(b) the worker’s age, education, skills and work experience,
(c) the worker’s place of residence,
(d) the details given in the medical certificate supplied by the worker,
(e) the provisions of any injury management plan for the worker,
(f) any suitable employment for which the worker has received rehabilitation training,
(g) the length of time the worker has been seeking suitable employment,
(h) any other relevant circumstances.”
The Arbitrator did not refer to section 43A in his reasons but Mr Brown, on whose report he relied, claimed to have considered “jobs considered to be suitable duties for the worker to perform as defined by section 43A” (report Mr Brown, paragraph 10). However, Mr Brown did not refer to the lack of an injury management plan nor the lack of rehabilitation training, two important factors in any assessment of a worker’s ability to find and retain suitable employment. He did refer to the fact that Mr Cullen has been out of work for three years but did not consider the impact that may have on his ability to obtain employment.
In my view Mr Brown’s report and approach, and, therefore, the Arbitrator’s, was flawed in that his assessment of Mr Cullen’s ability to earn in his injured state was on the basis of earnings for uninjured workers in jobs where Mr Cullen would clearly have restrictions and a disadvantage on the open labour market. In respect of handyman work, Mr Brown provided evidence of earnings for able-bodied workers. Whilst the Arbitrator may have been able to use that as a guide as to determine Mr Cullen’s ability to earn in his injured state, the Arbitrator did not do an analysis, as required by the legislation, to determine what those earnings might have been for a person with Mr Cullen’s injury and restrictions, with no injury management plan, who left school at the end of year nine and who has been out of the workforce for three years. It was totally unrealistic to find that Mr Cullen would be able to earn $732.00 per week as a handyman restricted to lifting no greater than 5kg when he was only able to earn $480.00 per week in the same field when he was uninjured. Mr Brown properly noted that the 5kg-lifting limit (agreed to by Dr McGroder) was “somewhat restrictive” but the Arbitrator took no account of that restriction in his assessment of Mr Cullen’s ability to earn. Both the Arbitrator and Mr Brown failed to acknowledge or give any proper weight to the other restrictions noted by Dr McGroder (avoiding the maintenance of fixed or awkward positions) or that the doctor felt that Mr Cullen was unfit for work as a ‘yardsman’ (handyman).
Similarly, in respect of courier work Mr Brown’s evidence of the earnings of couriers was evidence of the earnings of able-bodied workers and did not take into account Mr Cullen’s restrictions and the impact those restrictions would have on his ability to find and retain employment. Mr Brown’s assertion that the 5kg-lifting limit would be manageable as there was a range of courier work where the items to be handled were no more than that weight or in which manual handling aids could be used was a generalised claim that did not focus on the Batemans Bay area. I agree with the Appellant Worker’s submission that the fact that reasonable loading and unloading arrangements would require a trolley suggests that weights over 5kg would have to be carried and unloaded. The Arbitrator did not properly consider whether Mr Cullen’s restrictions could in fact be accommodated in a courier job without a loss of income.
Mr Brown’s surmise that Mr Cullen could run a caravan park with his wife ignored the fact that Mr Cullen was unfit for work as a handyman.
The jobs Mr Brown found to be available were for able-bodied workers without restrictions. Whether Mr Cullen’s restrictions could in fact be accommodated while working as a courier was not properly considered or assessed by the Arbitrator.
In the text Workers Compensation in New South Wales, second edition, by C P Mills (‘Mills’), the following passage provides what I believe to be a fair summary of the law on incapacity and identifies the proper question to be asked. At page 285 the author said:
“The question is whether the injury has left the worker in such a position that in the open labour market his earning capacity is less than it was before the injury (Williams v Metropolitan Coal Co Ltd (1948) 76 CLR 431 per Starke J), and it is not limited to the effect on his capacity for his former work (per Dixon J). In Ball v Hunt [1912] AC 496, Lord Loreburn had said that there is incapacity when a man has a physical defect which makes his labour unsaleable in any market reasonably accessible to him, and there is partial incapacity when such a defect makes his labour saleable for less than it would otherwise fetch: see Commissioner for Railways v Agalianos (1955) 92 CLR 390 per Dixon CJ.” (emphasis added)
In Alexander v Ashfield Municipal Council, CA 78/81, 27 October 1982, Hutley JA observed:
“Capacity is diminished, even though in selected instances the worker can earn as much as he did before, if there are fields from which he is excluded, by reason of the injury, in which he laboured at the time of injury.”
In Mangion v Visy Board Pty Ltd (1992) 8 NSWCCR 175 (‘Mangion’) a Commissioner of the former Compensation Court of NSW (‘the Court’) found an injured worker to be partially incapacitated but did not award any weekly compensation on the ground that the worker was able to earn more as a security guard (suitable light duties) than he had in his pre-injury job. On appeal to a judge of the Court it was held by Judge Burke that the Commissioner had fallen into error in his approach to calculating compensation under section 40 of the 1987 Act. His Honour said at 180:
“When assessing a capacity to earn under section 40(2), it is not sufficient to merely identify a particular potential avenue of employment and attribute the income from such a job as a man’s capacity to earn. Allowance must be made for the availability of work - availability, not so much in the sense of a presently depressed labour market but in the sense of the general availability in any labour market. A rarely available niche in the labour market which carries, perhaps, substantial remuneration, does not serve as a sole criterion of capacity to earn.”
His Honour added:
“When one assesses an ability to earn under section 40(2), one is really arriving at a weighted average. Wage rates for jobs within capacity that are rarely available, though perhaps highly paid, rate poorly in such an assessment. Conversely, the income derivable from more readily available work rates highly.”
The Court of Appeal in Cowra Shire Council v Quinn (1996) 13 NSWCCR 175 expressly approved the approach by Burke J in Mangion.
Whilst Mr Brown’s report provided some evidence on the availability of work as a courier (ASCO code: 8114-11), there was no probative evidence as to the availability of courier work that would have been suitable for a worker in Mr Cullen’s circumstances. The Arbitrator did not consider Mr Cullen’s ability to obtain and retain such work.
In reaching the above decision I have carefully considered the Respondent Employer’s submission that “interference with an Arbitrator’s discretionary judgement as to the weight of evidence should only be done where it is manifestly obvious that the discretion has so miscarried that it has not been exercised fairly and lawfully” (Knight v Eyles Nominees Pty Ltd [2004] NSWWCCPD 73 at [40]). In my view the Arbitrator’s errors do not merely go to matters of discretion (which are not immune from challenge) but amount to a failure to fairly and lawfully consider and apply the relevant provisions of section 43A. In addition, the Arbitrator failed to consider the disadvantage Mr Cullen faces on the open labour market and the impact that disadvantage will have on his ability to sell his labour.
The above errors require that the Arbitrator’s determination be revoked. In view of the history of this matter and the issues raised at the arbitration, it is appropriate that the matter be remitted to a different Arbitrator for re-determination.
DECISION
The Arbitrator’s determination dated 1 March 2007 is revoked and the following orders made:
“1.The matter is remitted to a different Arbitrator for the Appellant Worker’s claim to be re-determined in accordance with the reasons in this decision.
2.Costs of the first arbitration are to follow the event of the second arbitration.”
COSTS
The Respondent Employer is to pay the Appellant Worker’s costs of the appeal.
Bill Roche
Deputy President
9 August 2007
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF BILL ROCHE, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
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