Electrolux Home Products Pty Ltd v Milenkoski
[2006] NSWWCCPD 321
•27 November 2006
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION: Electrolux Home Products Pty Ltd v Milenkoski [2006] NSWWCCPD 321
APPELLANT: Electrolux Home Products Pty Ltd – as self insurer
FIRST RESPONDENT: Steve Milenkoski
SECOND RESPONDENT: Allianz Australia Workers Compensation (NSW) Limited
THIRD RESPONDENT: GIO General Limited
FILE NUMBER: WCC18669-05
DATE OF ARBITRATOR’S DECISION: 14 March 2006
DATE OF APPEAL DECISION: 27 November 2006
SUBJECT MATTER OF DECISION: Prior consent award – estoppel, admissions; adequacy of reasons.
PRESIDENTIAL MEMBER: Acting Deputy President Michael Snell
HEARING:On the papers
REPRESENTATION: Appellant: Lucas & Staggs
`First Respondent: Turner Freeman
Second Respondent: Hicksons
Third Respondent: Rankin Nathan Lawyers
ORDERS MADE ON APPEAL: Paragraph 6 of the decision of the Arbitrator dated 14 March 2006 is revoked. The balance of the decision is confirmed.
The Appellant is to pay the costs of the Respondents, of the appeal.
BACKGROUND TO THE APPEAL
On 10 April 2006 Electrolux Home Products Pty Ltd (‘Electrolux’), in its interest as a self insurer (‘the self insurer’) sought leave to bring an ‘Appeal Against Decision of Arbitrator’ in the Workers Compensation Commission (‘the Commission’) against a decision, dated 14 March 2006.
The Respondents to the appeal are Steve Milenkoski (‘the worker’), together with the two other relevant insurance interests of Electrolux, being Allianz Australia Workers Compensation (NSW) Ltd (‘Allianz’), and GIO General Ltd (‘GIO’).
The worker commenced working with Electrolux from 23 August 1996, and was terminated on 23 May 2003. The last day the worker actually carried out any duties was “approximately 19 March 2002” (according to his statement dated 19 December 2005).
The worker’s claim was pleaded, in his Application to Resolve a Dispute registered 2 November 2005 (‘ARD’), as one for weekly compensation from 1 January 2002 to date and continuing, medical expenses, and a lump sum in respect of 20% permanent loss of use of the sexual organs. The worker relied upon injuries alleged to have occurred on 15 April 1998, 15 April 2001, 10 August 2001 and 18 January 2002, together with the nature and conditions of his employment from 15 April 1998 to 31 March 2002. The injuries pleaded were to the back, legs, sexual organs and depression. The ‘disease’ provisions are also mentioned. The periods of risk of each of the three insurance interests nominated in the proceedings were, according to the statement made by the arbitrator at the commencement of the arbitration hearing, with which no one cavilled:
Allianz Relevant periods up to 30 June 1999
GIO 19 February 2001 to 31 December 2001
Self insurer 1 January 2002 to date
It will be seen there is a gap from 30 June 1999 to 19 February 2001. The arbitrator stated “Smorgons” had been an insurer for this period, and Smorgons had not been joined to the proceedings. A letter from Electrolux to the worker’s solicitors dated 18 March 2002 (attached to the ARD) indicates “Comsteel Self Insurance Department” was the relevant insurer over that period. None of the incidents relied upon occurred during that period, and the non-involvement of that insurer was not the subject of controversy during the running of the arbitration hearing.
There had been prior proceedings between the worker and Electrolux, in the Compensation Court of NSW, in matter number 14221 of 2002 (‘the Court proceedings’). The last pleading filed by the worker in those proceedings, on 14 November 2002, was headed “Further Further Amended Application for Determination”. That document claimed lump sum compensation pursuant to sections 66 and 67 of the Workers Compensation Act 1987 (‘the 1987 Act’), for permanent impairments and losses of the back and legs respectively. It did not include a claim for weekly compensation. It pleaded injuries on 15 April 1998, 18 January 2001, 15 April 2001, and the “nature and conditions of employment from 15 April 2001 to date and continuing”. The incident of 18 January 2002 was not relied upon. The insurers nominated in that document were Allianz and GIO, the self insurer was not nominated as a relevant insurer of Electrolux. Those proceedings were resolved by terms of settlement dated 1 July 2003. These provided for consent awards in the worker’s favour in respect of 20% permanent impairment of the back, 5% permanent loss of efficient use of both legs at or above the knee, and a sum for pain and suffering. The terms noted apportionment between Allianz and GIO was to be “50/50”.
The current matter was listed for arbitration hearing on 10 March 2006. All of the parties were legally represented. No oral evidence was called. The arbitrator dealt with the matter on the basis of the documentary material before her, after hearing submissions on behalf of the parties.
THE DECISION UNDER REVIEW
The ‘Certificate of Determination’, dated 14 March 2006 records the Arbitrator’s orders as follows:
“1.That the Respondent pay the Applicant the maximum statutory rate under section 40 from the 21 September 2003 to date and continuing.
2.That the Respondent be given credit for payments made.
3.That the Respondent pay the Applicant’s section 60 expenses upon production of accounts or receipts.
4.That the Respondent pay the Applicant’s costs as agreed or assessed.
5.That each of the insurers contributes equally towards and (sic) Applicant’s claim for weekly benefits and medical expenses in relation to the Applicant’s back.
6.The self insurer pays the Applicant’s medical expenses in relation to the Applicant’s sexual dysfunction.
7.That each of the insurers equally pay the Applicant’s costs as agreed or assessed.
8.The Respondent is not liable for payment of the Applicant’s claim under s66 of the Workers Compensation Act 1987.
9.That these proceedings be declared complex.”
The arbitrator, in her Reasons, noted the worker had been paid weekly compensation and medical expenses by a combination of Allianz and GIO up to September 2003, and the weekly claim in fact commenced from 21 September 2003. She described Allianz and GIO as having initially accepted liability for the worker’s injury of 16 January 2002 (pleaded as 18 January 2002), “considering this to be an exacerbation of the earlier injuries, rather than a separate frank injury”.
The main topic of contention between the parties during the running of the arbitration hearing was the question of which of the alleged injuries had ‘caused’ the worker’s alleged incapacity, and which of the insurance interests was liable as a consequence. In tandem with this argument, it was asserted by the self insurer that Allianz and GIO were estopped, as a consequence of having settled the Court proceedings, from denying they were liable for payment of compensation claimed in the current proceedings. The arbitrator’s reasoning process dealing with these issues is to be found at paragraphs [10] to [15] of her Reasons.
ISSUES IN DISPUTE
The self insurer raises the following matters in its appeal:
(i)The arbitrator erred in apportioning any liability to the self insurer. A number of points are made in support of this contention, effectively claiming the finding that injury during the self insurer’s period of risk was, in part, a cause of the worker’s incapacity was against the weight of the evidence. It is argued injury during that period, at most, gave rise to a temporary aggravation of the worker’s condition. The self insurer emphasises Allianz and GIO agreed to a consent award, paid by them equally, in the Court proceedings, largely for the same injuries pleaded in the current matter. Allianz and GIO also voluntarily paid weekly compensation and medical expenses up to September 2003.
(ii)The arbitrator failed to give adequate reasons for her finding the worker’s incapacity resulted, in part, from injury during the self insurer’s period of risk.
(iii)The arbitrator erred in ordering the worker’s medical expenses in respect of sexual dysfunction should be paid by the self insurer. It is said there was no claim for expenses pursuant to section 60 of the 1987 Act. In addition, it is argued the finding was against the weight of the evidence, as the sexual dysfunction would, as a matter of logic, have resulted from injuries prior to the self insurer’s period of risk, even if the self insurer was also partially responsible for such dysfunction.
(iv)The self insurer also states it relies, in this appeal, upon the written submissions it utilised in the arbitration hearing. Such submissions are annexed to the self insurer’s appeal documentation. I shall not seek to set out at length, or paraphrase, those submissions, which are eighteen pages in length. Amongst other things, they place great emphasis upon the fact Allianz and GIO each accepted voluntary liability at various times, and were parties to the consent award in the Court proceedings.
The worker, Allianz and GIO each oppose the appeal. It is submitted the injury in January 2002, during the self insurer’s period of risk, was not relied upon in the Court Proceedings, and that neither Allianz or GIO accepted it was liable for injury falling outside its period of risk. It is submitted there was ample evidence before the arbitrator to justify her finding of injury on or about 16 January 2002, resulting (in part) in the worker’s ongoing incapacity. It is submitted the arbitrator properly identified the issues before her, dealt with them adequately, and gave adequate reasons.
There is no challenge made to the award in the worker’s favour, nor to the quantum of that award. There is no challenge by the worker in respect of his lack of success on the further claim pursuant to section 66, for loss of use of the sexual organs. The sole issue between the parties on the appeal relates to the apportionment of part of the liability for the award, against the self insurer.
ON THE PAPERS REVIEW
14.Section 354(6) of the Workplace Injury Management and Workers Compensation Act, 1998 (‘the 1998 Act) provides:
“(6) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
It is submitted by the self insurer, the worker, and GIO, that the appeal can be dealt with ‘on the papers’, without an oral hearing. Allianz, at point 2.5 of its Notice of Opposition, under the heading “Supporting Documentation”, submits the appeal should not be dealt with solely on the basis of the written material. However at page 5 of its submissions it submits the “Appeal can be dealt with on the papers.” Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, and the submissions by the parties, I am satisfied that I have sufficient information to proceed ‘on the papers’, without holding any conference or formal hearing, and that this is the appropriate course in the circumstances.
LEAVE
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 of the arrears of weekly compensation awarded by the arbitrator would be in the vicinity of $50,000.00, and one third of this is payable by the self insurer, and at issue in this appeal. This is without having regard to the award for medical expenses, and the ongoing nature of the weekly award. Clearly the thresholds in section 352(2) of the 1998 Act are satisfied.
The appeal was lodged within 28 days of the Arbitrator’s decision in compliance with section 352(4) of the 1998 Act.
In all of the circumstances I grant leave to appeal.
FRESH EVIDENCE
‘Fresh evidence’ on appeal is governed by section 352(6) of the 1998 Act, which provides as follows:
“(6) 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.”
Practice Direction No.6 sets out the process for seeking leave of the Commission to give ‘new evidence’ on appeal. It provides as follows:
“New Evidence
Where a party seeks leave to give new evidence in relation to the decision appealed against, that party must serve a copy of the new evidence on the other parties to the dispute when serving the Application or Opposition.
In general, the Commission will allow new evidence to be introduced only where it can be demonstrated that the new evidence could not reasonably have been obtained by the party and tendered in proceedings before the Arbitrator and that failure to allow the new evidence would cause a substantial injustice in the circumstances of the individual case.”
Practice Direction No.6 also provides that if new evidence is sought to be relied upon, the Application or Opposition to the Appeal must contain:
“ -a schedule of the new evidence,
-a copy of the new evidence,
-a brief outline of the new evidence and the reasons why it was not given in the
proceedings before the Arbitrator, and
-submissions why the new evidence should be admitted.”
Allianz seeks to rely on fresh evidence, being the various Applications for Determination filed in the Court proceedings. The last of these, that filed 14 November 2002, headed “Further Further Amended Application for Determination”, was before the arbitrator, it having been part of the documentation attached to the worker’s ARD. The Terms of Settlement also were before the arbitrator. The additional Applications for Determination Allianz seeks to place in evidence were filed 28 March 2002, 2 August 2002, and 3 September 2002. It is submitted all of the Applications should be in evidence “for the sake of completeness”.
No injury in January 2002 (after the self insurer came on risk) was alleged in the Application for Determination filed 14 November 2002. The self insurer has submitted the injury pleaded in that document as having occurred on 18 January 2001, is probably pleaded in error, and should be a reference to 18 January 2002. This is said to justify a submission the injury in January 2002 was in the contemplation of the parties, when the Court proceedings were resolved (see page 5 of the self insurer’s submissions on the appeal). Allianz seeks, by reference to all of the Applications for Determination filed in the Court proceedings, to demonstrate that no injury in January 2002 was ever included. This would render it less likely the reference to “18 January 2001” was a typographical error, intended to be referring to “2002”.
It is submitted by Allianz the further Applications for Determination, the subject of the application to admit fresh evidence, “were not available at the time of the hearing of the matter in the Commission”. There is no submission, in compliance with Practice Direction No 6, dealing with the question of why the fresh evidence could not reasonably have been obtained and tendered in evidence before the arbitrator. Allianz was party to the Court proceedings, and on the face of it, would have been expected to be in possession of pleadings served in the Court proceedings, or to have ready access to them. In addition, I am not satisfied, based upon the submissions in support of the application to use this fresh evidence, that failure to allow it would cause a substantial injustice in the circumstances of the case.
Accordingly, the application to give fresh evidence is refused.
DISCUSSION AND FINDINGS
The arbitrator found the ‘disease’ provisions in sections 15 and 16 of the 1987 Act were not relevant in the circumstances. The self insurer (understandably, as it is the last insurer in time) says it “agrees with the arbitrator’s finding” in this regard. The other parties do not, on this appeal, assert the ‘disease’ provisions should have been applied. Thus that part of the worker’s allegations may be put to one side.
Although the worker relied upon the “nature and conditions” of his employment, in addition to the incidents pleaded, the arbitrator, in analysing the significance of the various injuries relied upon, placed emphasis upon the specific incidents, rather than the nature of the worker’s duties generally. The incident pleaded as occurring on 10 August 2001 was, in fact, a rib injury, which was of little or no relevance to the back condition which incapacitated the worker. Thus the relevant injuries became those of 15 April 1998, 15 April 2001, and 16 January 2002 (pleaded as 18 January 2002). At [9] of her Reasons the arbitrator said “I also note that after each of the incidences the Respondent paid the Applicant workers compensation whilst he was recovering. I am satisfied that there is overwhelming evidence that the Applicant is suffering incapacity as a result of one or more of his injuries.” At [13] she said:
“…I am satisfied that each of the incidences contributed towards the Applicant’s incapacity. Although the Applicant was able to return to work after both the 1998 and 2001 incidences, there is no doubt that each of these incidences have contributed towards the Applicant’s current condition. I do not consider it appropriate that I should take the 16 January 2002 incident in isolation and attribute the sole responsibility for incapacity to that incident. Although the Applicant was able to return to full time duties after 1998 and April 2001 I am satisfied that these injuries contributed to the Applicant’s back condition in 2002. I note the CT scan of April 2001 indicates disc damage. I also note that the Applicant was again complaining of back pain in December 2001, prior to the 16 January 2002 incident.”
The self insurer’s challenge to the arbitrator’s finding regarding the contribution of the three incidents, and in particular that of 16 January 2002, is two pronged. Firstly, it challenges the finding on a factual basis. Secondly it raises the consent award of 1 July 2003, and says the arbitrator’s finding was not reasonably open, either because of principles of estoppel, or because she failed to give appropriate weight to the admissions by Allianz and GIO, which were inherent in that consent award.
The Alleged Error in Fact Finding
The self insurer refers to various pieces of evidence, which it says militate against the incident of 16 January 2002 being of significance. The incident is not referred to in the worker’s chronology, and it is not mentioned by the worker in certain medical histories (reference is made to Drs Shapiro, Burke and Evans). It is also submitted the worker “was only off work for two weeks after the 16.01.02 incident, and then returned to the same light duties on which he had been placed following the earlier injuries”. Reference is made to the fact the worker’s statement says he was working on restricted duties at the time of the January 2002 incident.
As regards the chronology, it is true the injury of 16 January 2002 is not mentioned. However there is a specific history of it in the worker’s statement of 19 December 2005. And the chronologies (there are two of them) attached to the worker’s ARD, could not be regarded as comprehensive documents. The first of them (which deals with events up to 14 November 2001) also fails to make a reference to the back injury in April 2001, when GIO was on risk. The second chronology (which deals with events up to 7 May 2002) does not mention the worker’s cessation of work, from February 2002.
As regards the medical histories, there are multiple histories recorded by different medical practitioners at different times, which are not invariably consistent. Dr Shapiro was a general practitioner who saw the worker at a medical centre at the premises of Electrolux. He records first seeing the worker on 1 May 2004 (this is a typographical error, and clearly should be 1 May 2001). There are three consultations recorded in May 2001. This is during the month after the incident of April 2001, when GIO was on risk. By 29 May 2001 Dr Shapiro recorded a full range of pain free back movements, and certified the worker fit for full duties. The next consultation mentioned is on 15 January 2002, with a complaint of increasing low back pain over the preceding weeks. Dr Shapiro prescribed medication and physiotherapy, put the worker off work for approximately one week, and then marked him fit for restricted duties. When he saw the worker on 19 February 2002, Dr Shapiro was sufficiently concerned that he gave the worker a referral to a neurosurgeon. The matters recorded by Dr Shapiro in early 2002 are clearly consistent with a significant flare up of the worker’s symptoms at that time. Dr Shapiro does not refer to a specific history of an incident being proffered by the worker, around that time. It is valid to make a submission that the absence of such a history in the report is consistent with the worker not giving such a history. It is valid to submit this may be a basis for inferring the incident either did not occur, or was not prominent in the worker’s mind when he was consulting with Dr Shapiro. It is however only one piece of evidence, to be evaluated with the evidence overall.
Dr Evans saw the worker at the request of his own solicitors on 6 March 2002. He recorded a history of the incidents of April 1998 and April 2001. There is no history of the incident of 16 January 2002, although he does record the worker “was placed on short hours and light duties since January 2002”. Again, the history would justify a submission the incident of 16 January 2002 either did not occur, or at least was not prominent in the worker’s mind when he saw Dr Evans.
Dr Burke examined the worker on 19 December 2005. Although the report is addressed to “Recovre Medical Services”, the reference given is that of the solicitor with conduct of the matter on behalf of Allianz. The report records a history of the incident of 16 January 2002:
“On 16 January 2002, while he was still working light duties. He again hurt his lower back. He said that he had to lift some oven elements. Two elements were stuck together. He shook one in order to disengage the other. The shaking caused a recurrence of pain at about the L3 or L4 midline. There were no other symptoms. He ceased work immediately, reported the matter and went home early.
The following day he saw Dr Shapiro. He was put off work for two weeks.” (at P 3)
Thus Dr Burke (and the consultation is well after January 2002) does record a consistent history of the injury of January 2002, save for the date. Bearing in mind Dr Shapiro said he first saw the worker in 2002 on 15 January 2002, Dr Burke’s history would suggest the last incident occurred (if its occurrence is accepted) on 14 January 2002.
There are other histories consistent with the occurrence of the incident in January 2002. A neurosurgeon, Dr Van Gelder, saw the worker reasonably contemporaneously, on 23 March 2002 and 22 August 2002. He recorded:
“He described a fourth incident that occurred in January 2002. This was a pulling and lifting type accident when he developed the sudden onset of low back pain. He had a few weeks off work and then returned to work on light duties. His pain became progressively worse until his position was terminated.”
The worker was examined by Dr Davies, neurosurgeon (at the request of Hicksons) on 2 September 2002. He recorded a history of an injury in “early 2002” when lifting “tubs of silicone powder”, and trying to prevent one of them from overbalancing. This is said to have caused acute low back pain and right leg pain. On 11 September 2002 Dr Berry, general surgeon examined the worker at the request of his own solicitors. He recorded a final injury (which has no date assigned to it in the report) when the worker “had another lifting incident which aggravated both his chest and back”. The sequence of events described in Dr Berry’s history would be consistent with this incident being that of January 2002. Dr Bornstein, orthopaedic surgeon saw the worker at the request of Hicksons on 13 September 2002. He also recorded a history of an incident in January 2002 (the mechanics of which are not described) leading to back and right leg pain. There are further histories recorded by doctors who examined the worker for the purposes of the claim, which record histories of the 2002 incident (for example Drs Adler, Korbel and Lowy).
It follows from the above, that the histories are not invariably consistent. There is a longish history, dating back to 1998, with multiple incidents. The problem may well be exacerbated by matters of language. The worker is a native of Macedonia. He came to Australia initially from 1971 to 1981, returned to Macedonia, and came to Australia finally in 1996 (see the history recorded by Dr Burke in the report of 19 December 2005). He has not necessarily had the assistance of professional interpreters. His wife “occasionally assisted” on the examination with Dr Burke. Dr Berry records the worker’s son acted as interpreter, when he examined the worker. The worker’s son also assisted at the appointment with Dr Lowy. Dr Shapiro’s report does not suggest he had the assistance of an interpreter, even an amateur one. Dr Evans report does not refer to any person assisting with interpreting. The worker was not cross-examined, and the variation in histories was not put to him. Thus there is no explanation of the discrepancies in history.
The submission that the worker was on restricted duties at the time of the 16 January 2002 incident (if it occurred), had two weeks off, then returned to the same light duties, may be erroneous. The worker’s statement of 19 December 2005 says he was working on restricted duties at the time of the January 2002 incident. However this is inconsistent with some other contemporaneous material. Dr Drew examined the worker on 21 December 2001 at the request of his own solicitors. He recorded “He is working 40 hours over 5 days each week. He is meant to be on light duties but he is often doing heavier work and a variety of duties.” There is a report of Dr Desai dated 29 July 2004, attached to an Application to Admit Late Documents filed on behalf of GIO. That report describes the worker being put on a trial for work from 16 December 2001 to 8 January 2002, and on 8 January 2002 being given a certificate “to go back to pre-injury work”. There is also a report of Active O.H.S dated 22 January 2002 which recorded a return to full duties on 3 December 2001 (the date appears in the report as “02” but this is clearly a typographical error, having regard to the date of the report). Dr Davies recorded the worker “was performing normal duties prior to Christmas 2001”. Thus there is ample evidence the worker was performing either normal duties, or ‘light duties’ which in fact were not particularly light, prior to January 2002. The evidence from all sources, including Dr Shapiro, indicates the worker did not regain this level of functioning after January 2002.
Thus, when the points alluded to by the self insurer in its submissions are looked at in conjunction with other evidence, there is, in my view, ample evidence to support the conclusion of the arbitrator, that an injury occurred on or about 16 January 2002, which produced an ongoing worsening of the worker’s condition. Doctors expressed conclusions consistent with this (see Dr Davies, Dr Adler). Overall, the finding of fact reached by the arbitrator in this regard was open on the evidence. This is subject to questions of estoppel and admission, associated with the consent award in the Court Proceedings, which will be further discussed below.
Estoppel and Admissions Flowing from the Prior Consent Award
The self insurer submits the allegation of “nature and conditions” of employment in the Court proceedings was identical to that in the current proceedings. This is true, save for the fact the self insurer was not joined as an insurer in the Court proceedings. The pleadings in the Court proceedings, including the Further Further Amended Application for Determination, were filed by the worker, not Allianz or GIO. It would have amounted to a denial of procedural fairness in those proceedings, to make a finding of fact creating a liability on the part of the self insurer, it not having been joined. Thus, although the “nature and conditions” allegation was not limited to the period prior to 1 January 2002, a finding of injury subsequent to that date would not have been available, unless the self insurer was joined. The fact the worker’s pleadings were framed in this way, does not amount to an admission by Allianz or GIO, that incapacity subsequent to January 2002 resulted from injury prior to January 2002.
The self insurer also submits the reference to an injury on 18 January 2001 in the Court proceedings is an error, and should be read as referring to an injury on 18 January 2002, that is, the injury found to have occurred on or about 16 January 2002. There is simply no evidence to this effect. Furthermore, if the worker, in the Court proceedings, had wished to plead an injury on 18 January 2002, this would have involved the need to join the self insurer, it having been on risk as at that date.
Thus, while clearly the allegations of injury in the Court proceedings were similar to those in the current proceedings, they were not identical. Most significantly, the current proceedings involve an allegation of an incident in January 2002, which was not made in the Court proceedings, and could not have been, unless the self insurer had been joined to the Court proceedings.
The self insurer submits, validly, that payments of weekly compensation were made at different times by Allianz and GIO, and this potentially amounts to an admission by those insurance interests.
The self insurer, in its submissions on the appeal, states it relies on the submissions it made before the arbitrator. Those submissions refer in large part to admissions made by Allianz and GIO, in the payment of compensation. They refer to settlement of the Court proceedings. It is said “there has been no material change in the Applicant’s case against the Respondent since the settlement of the Court proceedings on 1 July 2003” (at [30]). It is said:
“40. On 1 July 2003 the respective liabilities of the Respondent’s insurers in relation to the pleaded injuries, which we submit encompassed all injuries particularised in the Application before the Commission, were agreed and the issues are not now open for further argument and determination.”
Later in those submissions reference is made to “estoppel and/or waiver”. The submissions do not identify the type of estoppel being raised. Clearly both issue estoppel and cause of action estoppel can arise in workers compensation matters: Bruce v Grocon Ltd (1995) 11 NSWCCR 247 (‘Bruce’), Lambidis v Commissioner of Police (1995) 12 NSWCCR 225. In the current matter, the award was one entered by consent, there had been no facts determined by the Compensation Court. The status of a consent award of the Compensation Court is considered by Neilson J in Anderson v Charles Sturt University (2002) 25 NSWCCR 407:
“28. Furthermore, I still have difficulty in seeing how when a party has reached a compromise settlement, an estoppel arises which prevents the Court from determining a case on its true merits and justice as the Court is required to determine. There are some dicta in that regard. I refer to the decision of Ferrari J in Ashendon v Stewarts and Lloyds (Australia) Pty Limited 1970 WCR 285, and particularly his Honour’s dictum at p 306 which I will not quote. However, the matter was taken on appeal. The issue in Ashendon v Stuarts and Lloyds was whether the parties could ask the Court to enter a consent award without the Court having to establish the facts and in effect approve the proposed settlement.
29. In the judgment of Jacobs JA in the Court of Appeal [1972] 2NSWLR 484 at 490 his Honour said this:
Judge Ferrari reached the conclusion, with which I respectfully agree, that the making of an agreement between the parties does not take away or diminish the jurisdiction of the Court.
30. Parties can ask the Court to enter up an award in accordance with their agreement. The Court, provided jurisdiction exists, can enter up that award. However, even though formed in the terms of a Court award, it is still in effect an agreement between the parties. It does not create any issue estoppel. Mere payment of compensation cannot amount to an estoppel but, at most, if anything, an admission. Such was the decision of Court of Appeal in APD Snack Foods Pty Limited v Vuic [1984] WCR62, a decision of Hutley AP, Glass and Mahoney JJA.
In Rail Services Australia v Dimovski & Anor [2004] NSWCA 267 (‘Dimovski’) Handley JA stated “A consent judgment can create res judicata estoppels” (at [9]). In dealing with the appropriate approach by a trial judge to such a consent award, in later litigation between the parties, His Honour said:
“14. The Judge’s remark that the consent award was “possibly” not an accurate assessment did not contravene res judicata principles. She had to determine the extent of the impairment at the date of trial. The consent award involved admissions by the parties and these, coupled with the presumption of continuance, were of some weight. However there was much other evidence, lay and expert, relating to the worker’s impairment at the later date and the weight to be given to the admissions and the presumption of continuance was a question of fact for the Judge.
15. Her task was to assess the extent of the worker’s current impairment following the later injuries without legal constraints flowing from the earlier award. Having made her assessment she was not obliged to find an explanation for the discrepancy. There were a number of possible explanations and her tentative speculation about one was simply irrelevant. Its disclosure did not reveal legal error.”
Applying the above principles to the current matter, the consent award of 1 July 2003 clearly constituted an admission by the parties to it, of certain matters. For example, it involved an admission by Allianz and GIO, that the worker had suffered compensable injury during their periods of risk, and certain permanent impairments and losses resulted. It could not amount to an admission by either of those insurers that there was no incapacity resulting from injury in 2002, after they ceased to be on risk. Such an admission would not be theirs to make. Nor was the question of any injury in 2002, and its consequences, a matter which arose on the pleadings. In so far as certain admissions can be gleaned from the consent award, they remain admissions, to be considered along with other evidence, consistent with Dimovski. In addition, the consent award involved a claim for lump sums in respect of permanent impairment and losses. The current matter involved a claim for weekly payments and associated medical expenses. It will often be the situation that the same finding on causation will be appropriate on claims for both lump sum compensation and weekly compensation. But this will not invariably follow. There may, for example, be a situation where a later injury, an aggravation, will constitute the cause (at least in part) of a period of incapacity, even if its consequences are not likely to be permanent, and an underlying permanent loss is properly attributable to an earlier event.
The consent award did not give rise to any form of issue estoppel. It could not. It was purely a consent award, no facts were determined by the Compensation Court.
The distinction between res judicata and issue estoppel is set out in the well known authority of Blair v Curran (1939) 62 CLR 464:
“The distinction between res judicata and issue estoppel is that in the first the very right or cause of action claimed or put in suit has in the former proceedings passed into judgment so that it has merged and has no longer an independent existence, while in the second, for the purpose of some other claim or cause of action, a state of fact or law is alleged or denied the existence of which is a matter necessarily decided by the prior judgment, decree or order.” (per Dixon J at 532).
In so far as any res judicata estoppels were created by the consent award (consistent with Dimovski), these would not relate to the worker’s rights to claim weekly compensation (which was not at issue in the Court proceedings), nor to any injury after 1 January 2002 (no such injury having been pleaded in the Court proceedings). It follows the Court proceedings, and the consent award, did not create either an issue estoppel, or a res judicata estoppel, inconsistent with the finding by the arbitrator of injury on or about 16 January 2002, which in part caused the worker’s incapacity for work.
As I indicated above, the self insurer’s submissions do not make clear the precise type of estoppel on which it seeks to place reliance. For the sake of completeness I should also refer to estoppel of the kind referred to in Port of Melbourne Authority v Anshun Pty Ltd (1981) 147 CLR 589 (‘Anshun’). There is a helpful analysis of the principles governing Anshun estoppel in workers compensation matters in Bruce, where Neilson J concludes:
“From these cases I distil the following principles:
(a) There is no "cause of action" for workers compensation. The Act creates a number of rights which a worker is entitled to pursue independently of other rights: Jorgensen's case, Thompson's case.
(b) Estoppel will arise if the relief claimed in second or subsequent proceedings was claimed in original proceedings: Jorgensen's case.
(c) Estoppel of the type referred to in the Port of Melbourne Authority v. Anshun Pty Ltd will apply if there were alternative bases to ground the relief claimed but one of those bases was not pursued: Ada's case. An analogous situation to Ada's case is one where a person claimed to be a "worker" and failed in that allegation. Subsequently he brought second proceedings seeking to allege that he was a "deemed worker" for the purposes of the Act. In such cases the claimant's remedy is pursuant to section 17(4) of the Compensation Court Act 1984.
(d) Where a claim could have been litigated in earlier proceedings but was not, there may be a cost penalty: Thompson's case, Jorgensen's case per Cox J at 164, Kerr's case at 295.” (at P 267)
The relief claimed by the worker in the current matter is different to that claimed by him in the earlier Court proceedings. As discussed at [48] above, different considerations on causation may well arise in proceedings for weekly compensation, as opposed to proceedings for lump sum compensation in respect of permanent losses and impairments. I would not regard Anshun type estoppel as having any application to the current circumstances.
A further matter is that, even if the consent award is properly regarded as involving an admission by Allianz and GIO that the worker’s condition from January 2002 was caused by the injuries in 1998 and 2001, this is not necessarily inconsistent with a finding incapacity subsequent to January 2002 was also caused by injury at that time. Incapacity can have multiple causes. Cluff v Dorahy Bros. (Wholesale) Pty Ltd [1979] 1 NSWLR 435 involved a worker who suffered injury with employer A, subsequently suffered aggravation with employer B, and then claimed against A, that his incapacity subsequent to the aggravation was caused in the relevant sense by the injury with A. In the Court of Appeal Reynolds JA said:
“It is well established, if a worker receives an injury in the course of his employment with A which renders him vulnerable to increased disability by the effects of further work; and then, in the employment of B, the work brings about those effects, that it is open to a tribunal of fact to hold that the ultimate incapacity has resulted from the first injury in the employment of A; and it is not to the point that, if the worker had in these circumstances proceeded against B, he might also have obtained an award in respect of the whole extent of his existing incapacity.
Thus, in the Court proceedings, it would have been possible for Allianz and GIO (the self insurer not having been joined) to be liable for an award, on the basis the permanent losses and impairments resulted from injury prior to 1 January 2002, even if it was also open on the facts to find such losses and impairments resulted in part from injury in January 2002. Even construing the admissions by Allianz and GIO in the manner advocated by the self insurer, such admissions are not inherently inconsistent with the finding made by the arbitrator, that the worker’s incapacity resulted in part from injury in January 2002.
The Causation Finding – Conclusion
In dealing with the appropriate approach to be taken in deciding questions of causation, Kirby P in Kooragang Cement Pty Ltd v Bates (1994) 35 NSWLR 452 said:
“The result of the cases is that each case where causation is in issue in a workers compensation claim, must be determined on its own facts. Whether death or incapacity results from a relevant work injury is a question of fact. The importation of notions of proximate cause by the use of the phrase “results from” is not now accepted. By the same token, the meer proof that certain events occurred which predisposed a worker to subsequent injury or death will not, of itself, be sufficient to establish that such death or incapacity “results from” a work injury. What is required is a commonsense evaluation of the causal chain. As the early cases demonstrate, the meer passage of time between a work incident and subsequent incapacity or death, is not determinative of the entitlement to compensation. In each case, the question of whether the death or incapacity “results from” the impugned work injury (or in the event of a disease, the relevant aggravation of the disease), is a question of fact to be determined on the basis of the evidence, including, where applicable, expert opinions.” (at 463G to 464B)
Fleming DP in Babylon Property and Cleaning Services Pty Ltd v Hormoz [2005] NSWWCCPD 21 (‘Babylon Cleaning’) described the function of a Presidential member on review:
“14. The consideration of the evidence and the weight to be attached to the evidence is entirely a matter for the Arbitrator. In the absence of demonstrable error by the Arbitrator in arriving at the decision it should not be disturbed. Presidential review (pursuant to section 352 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’)) is not a rehearing where a matter is heard de novo based on all of the evidence available at a later time (Coal & Allied Operations Pty Limited v Australian Industrial Relations Commission (2000) 203 CLR 194; Builders Licensing Board v Sperway Constructions (Syd.) Pty Ltd (1976) 135 CLR 616).
15. The errors alleged by the Employer are largely matters of discretionary judgement by the Arbitrator, on the basis of his view of the evidence before him. As with any exercise of discretion by an administrative decision maker, this discretion must be exercised lawfully and fairly, taking into account the scope of the discretion and the objects of purpose for which it is conferred. It is only where the Arbitrator can be said to have failed to exercise his discretion fairly and according to law that his decision should be overturned. This occurs where the Arbitrator has: acted upon a wrong legal principle; allowed irrelevant considerations to influence the decision; made a material mistake as to the facts or failed to take into account relevant and material considerations (House v The King (1936) 55 CLR 499 at 504-505; Norbis v Norbis (1986) 161 CLR 513 at 520, National Roads and Motorists’ Association Ltd [2003] FCAFC 206 at [21] to [21]).In the current matter there was, in my view, ample evidence to support the conclusion reached by the arbitrator, that the incapacity she found was ‘caused’ by injury during the period of risk of each of the three insurance interests which were joined, including the self insurer. The statement of the worker dated 19 December 2005 clearly described the injury in January 2002. It is not suggested the self insurer sought to challenge that statement by cross-examining the worker. Although not all of the doctors record a history of that injury, many do. Dr Korbel records he was told by the worker it was “the worst of his injuries” (report 10 January 2005 at P 2.5). There was ample medical evidence to support the conclusion that injury was, at least in part, a cause of the incapacity the arbitrator found (see for example Dr Adler’s report dated 4 May 2005). Some of the doctors went further. Dr Davies in his reports of 23 September 2002 related the whole of the worker’s impairments and losses to the injury in 2002, and said:
“The fourth injury sustained earlier this year was an important work-related injury which has led to a significant lumbosacral disc lesion and for the first time radicular leg pain which has been incapacitating.” (at P 3.7)
I do not detect any errors of the kind described in Babylon Cleaning, in how the arbitrator has analysed the evidence, and the conclusion she has reached. She has clearly approached her task aware of the consent award entered in the Court proceedings, and the self insurer’s arguments regarding its significance. These matters are mentioned at paragraphs [9], [12] and [14] of her Reasons. Although her analysis is not lengthy, the arbitrator’s Reasons at paragraph [13] make it clear she has reached her conclusion after a consideration of both the medical evidence, and the worker’s history. Subject to one matter with which I shall deal briefly below, I do not detect any error in the arbitrator’s consideration of the causation question.
The above is subject to the specific finding made by the arbitrator that the self insurer be solely responsible for payment of medical and related benefits pursuant to section 60 of the 1987 Act, in so far as they relate to treatment for the worker’s “sexual dysfunction”. The sexual dysfunction is discussed particularly in the report of Dr Lowy, a “sexual health physician”, dated 6 June 2003. It is clear, from that report, the worker’s sexual dysfunction is caused by “chronic back pain affecting libido and an ability to maintain erections” (at P 2.1). It is true Dr Lowy obtained a history from the worker of “erectile dysfunction since the January 2002 back injury” (P 1.8). Be that as it may, the sexual dysfunction, on the evidence, flows from back and leg pain, which itself results from the worker’s various back injuries. The arbitrator had already found the worker’s incapacitating back and leg pain resulted from three incidents in 1998, 2001 and 2002. In my view it is inappropriate to ascribe the sexual dysfunction to only the last of the injuries found, when the three injuries have been found to be causative of the back condition. Accordingly, paragraph 6 of the arbitrator’s Certificate of Determination should be rescinded, so that medical expenses relating to the worker’s sexual dysfunction are not treated any differently to other expenses properly payable under section 60.
Failure to Give Adequate Reasons
The self insurer, in its submissions on this point, has helpfully referred to the decision of Byron DP in Rick Damelian Pty Ltd v Romanas [2004] NSWWCCPD 93, where it is said:
“50. An Arbitrator is required by section 294(2) of the 1998 Act and Rule 73 to provide adequate reasons for decision in the determination of a dispute. (See also Absolon v NSW TAFE [1999] NSWCA 311 (Absolon) and YG v Minister for Community Services [2002] NSWCA 247) (YG). Failure to provide reasons is not only a breach of an Arbitrator’s statutory duty, it is an error of law (Sydney Water Corporation Ltd v Aqua Clear Technology, Supreme Court of NSW, per Rolfe J (P/L 55047/96) 17 December 1996; Dennis Willcox Pty Limited v Federal Commissioner of Taxation (1998) 79 ALR 267). If the failure is established, it may be a ground to revoke the decision. However, an Arbitrator is not required to give lengthy and detailed reasons, nor to recite and analyse in detail the content of the evidence and submissions. The standard by which adequacy of reasons must be determined is relative to the nature of the decision itself and the decision-maker (see discussion in Mayne Health Group t/as Nepean Private Hospital v Sandford [2002] NSW WCC PD 6 and Fraternity Bowling & Recreation Club Ltd v Sartor [2004] NSW WCC PD 47). However, for the ground of inadequate reasons to succeed, it must be demonstrated not only that the reasons are inadequate, but that the inadequacy sufficiently demonstrates that the Arbitrator has failed to exercise his or her statutory duty to fairly and lawfully determine the matter (see Absolon and YG).
The Reasons given by the arbitrator are, in my view, perfectly adequate having regard to the above principles. She has briefly recited the position taken by all of the parties when addressing her on the topic of causation (at [10] to [13]). She has dealt with the arguments advanced by the self insurer as regards the consequences of the consent award in the earlier Court proceedings (at [14]). At [13] she has identified aspects of the history which led her to the view that each of the incidents of 1998, 2001 and 2002 was in part causative of the worker’s incapacity. She describes her findings being made after “considering all the medical evidence” She does not recite the medical evidence, however, as was observed by Byron DP in the above passage, she was not required to do so. Even if the Reasons were regarded as inadequate (which in my view they were not), I can see no basis on which one could conclude any such inadequacy demonstrated the arbitrator had failed to exercise “her statutory duty to fairly and lawfully determine the matter.” Accordingly, in my view the ground of appeal which challenges the adequacy of the arbitrator’s Reasons must fail.
DECISION
Paragraph 6 of the decision of the arbitrator dated 14 March 2006 is revoked. The balance of the decision of the arbitrator is confirmed.
COSTS
The appeal by the self insurer has failed, save on one relatively minor point. The appropriate costs order is that the self insurer pay the costs of the Respondents, of this Appeal.
Michael Snell
Acting Deputy President
27 November 2006
I CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF MICHAEL SNELL, ACTING DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
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