Fellowes v Military Rehabilitation & Compensation Commission

[2009] HCATrans 149

[2009] HCATrans 149

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B8 of 2009

B e t w e e n -

ROBYN CHRISTINE FELLOWES

Appellant

and

MILITARY REHABILITATION AND COMPENSATION COMMISSION

Respondent

HAYNE J
HEYDON J
CRENNAN J
KIEFEL J
BELL J

TRANSCRIPT OF PROCEEDINGS

AT BRISBANE ON TUESDAY, 23 JUNE 2009, AT 10.13 AM

(Continued from 22/6/09)

Copyright in the High Court of Australia

HAYNE J:   Yes, Mr Howe.

MR HOWE:   Your Honours, at the close of yesterday we had identified what we said were the distinctive features of the methodology deployed by table 9.5, and we indicated that their Honours comprising the Full Court of the Federal Court in Van Grinsven placed significance upon that distinctive methodology, and they did so at paragraphs 14, 15 and 16 of the judgment.  There is no need for your Honours to go to it.  We extract those relevant paragraphs at paragraph 10 of our written submissions.

We did want to make the point in answer to a matter that fell from Justice Hayne yesterday, that as we understand it no part of their Honours’ approach in Van Grinsven depended upon giving the expression “impairment” other than its defined meaning.  Certainly, for the sake of abundant clarity, no part of a case that we advance in these proceedings involves giving the expression “impairment” other than its defined meaning.

Now, the appellant for her part concentrates on a particular aspect of the definition, and we are content for the matter to proceed on that basis, but we would say that ultimately an employee is entitled to rely upon one aspect of the definition, or two or three aspects, or indeed the whole definition.  In these proceedings the appellant says, well, the relevant impairment caused by my injury was the loss, or the partial loss, of the use of my knee.

We say that accepting that comes within the definition of “impairment”.  One then has to assess the degree of that, and we submit that in doing that the methodology deployed by the guide is to do so by reference to the impact of the impairment on the employee as a whole person, particularly by reference to his or her ability to undertake and perform and discharge the activities of daily living.

Your Honours, I closed yesterday by conceding that no part of the Act expressly refers to the concept of “whole person” impairment but I did take your Honours to relevant sections of sections 24, 25 and 28 which do refer to an assessment or determination of the degree of impairment of an employee, and we relied on that, as it were, to indicate that the Act is concerned with assessment of degree of impairment by reference to the impact of the impairment as defined on an employee as a whole person, and we say support for that is to be gained by not only the second reading speech but also by consideration of the fact that the Act and the guide do operate as integral parts of an entire legislative scheme.

It is apparent, in our submission, that it was intended that the concept of assessment of the degree of impairment by reference to an employee as a whole person was intended to be a feature.  The relevant part of the second reading speech – and again your Honours need not go to it but I can give you the relevant passage – it appears ‑ ‑ ‑

HAYNE J:   Do we have it in your bundles?

MR HOWE:   Yes, it is with the materials filed by the appellant.

HAYNE J:   Yes.

MR HOWE:   The relevant passage appears at page 2193 in the right‑hand column at about point 6 on the page.  You have the Minister in the second reading – I am sorry, it is in a different form.

HAYNE J:   Well, we are blessed with the so‑called printer friendly version.

MR HOWE:   Yes.  Your Honours, I am working off the actual appearance of the second reading speech in Hansard and I undertake to file a copy of that.

HAYNE J:   Yes, well, perhaps if you could make that available to us and if you could tell us what the references are?

MR HOWE:   Yes, your Honour, it appears at page 2193 right‑hand column at about point 6.  It is a very short passage, your Honours, and the Minister simply said:

Under the existing Act, lump sum payments are made on the basis of a table of maims.

KIEFEL J:   On our page that is at about point 8 on page 2.

MR HOWE:   Thank you, your Honour.  The existing Act was the 1971 Act, and some of your Honours at least may recall that under that Act you did have a very limited schedule or table appended to the Act which was known colloquially as the table of maims, but it did not deal with a whole range of significant injuries such as back injuries and psychological injuries and the like.  The Minister made reference to that and to the level of impairment:

being determined having regard to the loss, or loss of the efficient use, of various parts of the body.  That approach –

by reference to a limited table of maims –

has been abandoned and the level of payments in the future will be determined using a ‘whole person’ approach, similar to that used under the Veterans’ Entitlement Act 1986.

More importantly, we would want it understood that contrary perhaps to some indications that fell from my learned friend yesterday, no part of this Court’s reasoning in Canute gainsaid the proposition that the legislative scheme does intend to incorporate assessment of degree of impairment by reference to a consideration of the impact on an employee as a whole person.

In particular, this Court in Canute at paragraphs 6 and 12 – there is no need for your Honours to go to them – but the Court accepted that the content of the phrase “degree of permanent impairment of the employee” in section 24(5) is left by the Act to the guide.  Then even more significantly at paragraph 37 of the judgment of the High Court in Canute the Court expressly accepted that the Act itself does adopt the whole person approach to the assessment of the degree of impairment of an employee resulting from an injury.

HAYNE J:   Can I understand better than I presently do how that operates in connection with 24(1) and 24(5)?  Do I understand the starting point of this branch of the argument to be in 24(5) that what is required is determination of the degree of permanent impairment of the whole person?

MR HOWE:   Yes, your Honour.

HAYNE J:   That is the starting point?

MR HOWE:   Yes, your Honour.

HAYNE J:   How does the reading of “impairment” in 24(5) understood in that way sit with the reading of “impairment” in 24(1) in a case where there has been an injury to an employee resulting in damage to a part of the body, the left knee, which is permanent, and then subsequently damage to another different part of the body, in this case the right knee, which again is permanent?  Is there not some shift in the understanding, or at least the application, of the elements of the definition of “impairment” that are taken up in (5) from those that are taken up in (1)?

MR HOWE:   We would say, no, your Honour, because one applies section 24(1) and accepts, as we do in this case, that the appellant did suffer an injury as defined, it did result in a permanent impairment, taking the definitions of “impairment” and “permanent” set out in section 4 of the Act, and that gives rise to, as it were, a notional or contingent liability on the part of the respondent to pay compensation.

However, the compensable degree of that permanent impairment as defined in terms of its impact upon the employee as a whole is to be determined, albeit through the prism of each separate injury, in accordance with section 24(5) which directs attention to the criteria and methodology contained in the guide in fulfilment of the obligation imposed by section 28(1).  So, in our submission, it is not necessary to recognise that there is some shift in the Act’s treatment of impairment as between section 24(1) and section 24(5).

KIEFEL J:   Do you not have to read subsection (5) – do you have to read the words “the degree of permanent impairment of the employee” as a composite notion, and your argument is not that different from what is referred to in subsection (1), at least by way of extension, because you have the permanent impairment constituted by the injury to part of the body now seen as something which has an impact or effect upon your argument?  So it is more than just the impairment about which subsection (5) speaks.

MR HOWE:   Yes.

KIEFEL J:   It is about the extension of the impairment into the person’s daily activities on your argument.  So you are adding to the definition, to answer his Honour’s question.

MR HOWE:   Yes, as part of assessing, or for the sole purpose of assessing in accordance with the Act, the compensable degree of that impairment as defined; it is solely for that purpose.  One could take as an example, for instance, an injury to a part of the eye, whether it be the retina or the optic nerve, and there is no doubt that that injury can result in an impairment as defined, such as a thinning of the retina or some sort of depletion in the signalling of the optic nerve, but that impairment as defined when one comes to assess its compensable degree may not in fact result in any compensable degree of permanent impairment of the employee because it may not interfere with any fundamental activity of daily living.

Of course, in the case of damage to parts of the eye one is concerned ultimately with sight as being the primary biological function of the eye, and so the table dealing with visual acuity does not direct attention to the particular injury to the particular part of the eye, whether it be the tear duct or the optic nerve or the retina.  Rather, it says, well, if there is an injury which does result in impairment as defined then one assesses the degree by reference to the primary activity of sight.

KIEFEL J:   Are you not then saying that you take impairment as defined as the starting point for the purpose of subsection (1)?

MR HOWE:   Yes.

KIEFEL J:   Then you are regarding it as somewhat overwhelmed by the other criteria in subsection (5).  Its meaning as defined, to answer Justice Hayne’s question, is overtaken by the other purposes of subsection (5).

MR HOWE:   If it is then it is solely for a purpose countenanced by the Act.

HAYNE J:   Well, Mr Howe, now is the time to choose.  What is your submission?

MR HOWE:   Our submission is that there is no confounding or beguilement of the concept of impairment when one moves from subsection (1) to subsection (5), and we say that section 28 in particular does contemplate that one has an impairment, it does affect an employee, but in terms of assessing the degree of that one applies the criteria and methodology.  One does not depart from the definition of “impairment” in any way in doing that, one simply deploys criteria and methodology for the purposes of assessing the compensable degree of that impairment.

One does so, firstly, by incorporation or by reference to the employee as an entire person, and secondly, by reference to the primary biological activities of daily living.  Those are the methodologies deployed by the guide.  We do not understand, for instance, any part of the reasoning in Van Grinsven to confound or beguile or ‑ ‑ ‑

HAYNE J:   Well, we are not bound by Van Grinsven, Mr Howe.

MR HOWE:   Indeed so.

HAYNE J:   It is a question of what the Act means.

MR HOWE:   Yes.  Your Honour, what we therefore say is that my learned friend yesterday did put it too highly when he submitted to the Court that the High Court itself in Canute had altogether dismissed the concept of impairment of the whole person as a controlling concept.  Now, we absolutely accept that the concept of impairment of the employee as a whole person cannot control or confound the operation of the Act, and in Canute this Court said it cannot undermine the definition of “injury”.  What the Act requires to be dealt with as an injury must be dealt with as an injury, and one cannot go to the guide and treat it as though it is not an injury but an impairment; we accept that.

In terms of assessing the degree of impairment, our submission is diametrically opposed to that of my learned friend, and we would say that the guide is intended to be controlling in terms of the assessment or determination of the degree of the impairment.  In that regard, of course, your Honours have been taken to the language on page 5 of the guide, namely:

Where two or more injuries give rise to the same impairment a single rating only should be given.

Our submission is that that is part of the methodology of the guide and it applies in a manner which, with respect to the assessments of some degrees of some permanent impairments, will have a limiting effect; there is absolutely no doubt about that.

We submit that the statement does not distinguish between concurrent injuries on the one hand and sequential injuries on the other hand.  It does not distinguish between injuries which are located on the same general part of the body or a wholly separate or distinct part of the body.  In our submission, the plain meaning of those words, particularly when placed in the context of the methodology deployed in the guide as a whole, and in particular in table 9.5, plainly supports the result for which we contend.

In our submission, the appellant has not offered any interpretation of those words which allows that methodology on page 5 to be applied, save and perhaps the rather guarded concession that it might in fact apply in relation to sequential injuries to the same part of the same body limb.  In our respectful submission, there is simply no principled basis for distinguishing between the facts of the appellant’s case and an employee who, for instance, suffers an injury to the medial ligament of their left knee and then several years later suffers a separate injury, this time to the cruciate ligament of their left knee.  In our submission, one would apply the methodology in table 9.5 exactly the same way.

Can we say that in this particular case the appellant was in a somewhat unfortunate position because she had available to her, of course, another possible method of assessment of the degree of the impairment under table 9.2, but the methodology there is to assess the degree by reference to the loss of range of movement of the knee, and it was an agreed fact before the Tribunal that this particular appellant was so affected by a knee injury that she did not qualify under table 9.2, and had she done so, we absolutely accept that that would not be the same impairment and she would have been entitled to a separate award of compensation based on whatever percentage rating she satisfied.  If it was 10 per cent then the appellant would get an additional 10 per cent compensation.

Within the rubric of the guide, within the construct of the guide, we say that the impairment that the appellant ultimately contended for in table 9.5 was in fact the same impairment.  In relation to the somewhat limited or guarded concession that the appellant makes that the statement on page 5 might have limited application in the circumstances identified, we rely upon some statements made by Justice Burchett in Brennan v Comcare.  There is no need for your Honours to go to it, I will give your Honours the reference, but that case is in our list.

The relevant passage appears at page 556G to 557C, and in that particular passage his Honour just noted that one would prefer an interpretation of the Act that did not, as it were, draw arbitrary distinctions between whether one or more injuries were concurrent or sequential or affected this part of the body or a wholly separate and distinct part of the body.

Your Honours, the concept of two or more injuries resulting independently in the same impairment is not something which only arises under table 9.5 of the guide.  We say it is also apt under some other tables of the guide, and I will give your Honours references to those without going through them in any detail.  For instance, table 1.2, which appears on page 10 of the guide, that deals with injuries or diseases afflicting the cardio‑vascular system, and in particular with peripheral vascular disease.

If your Honours take, for example, the ratings of 20, 30, 40 per cent impairment and then the descriptions of the level of impairment which are the criteria, one can see that there might be, for instance, concurrent injuries or disease states which might give rise independently to the same described level of impairment.  Those injuries or diseased states might be concurrent or sequential, and we say that claudication, which as I understand it is limping, it is clear that table 1.2 assesses the degree of impairment arising from those sorts of impairments to the peripheral vascular disease by reference to walking, something that requires the use of both limbs.

Likewise, your Honours, table 5.1, which deals with psychological or psychiatric conditions.  One can well imagine, for instance, that an employee has a significant physical injury which leads to one psychiatric disease state, such as an anxiety condition, and then as a result of rumination or other factors the employee might years later develop a major depressive order or a post‑traumatic stress type disorder.  So one might have separate injuries which occur sequentially, and those separate injuries might be the subject of medical evidence to the effect that they were each separately and independently causative of the same degree of disability described, for instance, against rating 10 per cent.

In our submission, the employee would not in those circumstances be entitled to separate awards of compensation because under table 5.1 they would be the same impairments.  Of course, if the effect of the subsequent injuries was to increase the level of disability or impairment to the next described rating level then the employee definitely would be entitled to compensation.  Your Honours, the same arises under tables 12.2 and 12.4 but we will not labour the point by detaining your Honours in relation to those.

May it please, our approach, we submit, does not ignore at all the primacy of injury, and nor did the approach taken by the Full Court below in the plurality judgment.  We absolutely accept the need for an assessment of the degree of permanent impairment by reference to each and every injury, but on the basis of the criteria and methodology deployed in the guide being applied.

We also submit that our approach does not do any violence at all to the meaning of “resulting in” in quoting section 24(1), and indeed our approach has the advantage of being entirely consonant with the meaning of “resulting in” as noted by the plurality below and the reference by them to the case of Performance Cars Ltd which has been picked up and applied as we set out in our written submissions.  We therefore submit that when the methodology on page 5 of the guide is applied it leads in the case of this particular appellant very naturally to the consequence contemplated by section 28(5).

Could I conclude by just responding to a couple of submissions that fell from my learned friend yesterday?  It was put by my learned friend that tables 9.5 and 9.4 are similar.  In our submission, that is not right.  We do accept that each of them describe an activity of daily living.  Table 9.5 seizes upon the performance of self‑care as the relevant activity of daily living, and it does so in a way which on any fair view contemplates that either of the upper two limbs can be independently used for that particular activity.  Table 9.5 selects a different activity of daily living, namely, walking, and in our submission, it is quite clear that table 9.5 contemplates that that activity requires ordinarily, as held by the plurality below, the use of both legs.

The remaining matter, I do not want to spend any time on this at all, but it did fall from my learned friend, Mr Hanks, yesterday that the methodology deployed by the guide is that if one has multiple injuries leading to multiple impairments then one combines those impairments.  With respect, that is not our understanding and it is not this case.  Can we just say that our understanding is that if a single injury gives rise to multiple impairments then one uses the combined values table, but where you have two separate injuries, each of which give rise to two separate impairments,

then one simply gives the rating that is relevant to each of those impairments and does not seek to combine them.

With respect, there is a worthwhile treatment of that particular methodology in the judgment of Justice Hill in the case of Canute, which is on our list of authorities, (2005) 87 ALD 11. There is also a worthwhile treatment in the judgment of Justice Spender in Roser’s Case which is referred to by Justice Hill in Canute.  But in any event, that is not this case and so I do not want to detain your Honours any further on that aspect of the matter.

Finally, my learned friend relied upon the statement of Justice Enfield in Campbell’s Case at paragraph 4 to the effect that the guide was not intended to be limiting.  We simply say that that is not right, the specification of the criteria and the methodology was definitely intended to be limiting, particularly because this was a replacement of the common law right to claim damages with a statutory scheme that was designed to save money, but more particularly, it was designed to be applied according to its terms in ways that did not necessarily reflect full and complete restitution and it does not strive to be a perfect system of compensation.  May it please, those are the submissions for the respondent.

HAYNE J:   Thank you, Mr Howe.  Yes, Mr Hanks.

MR HANKS:   Thank you, your Honour.  Our learned friend, Mr Howe, referred yesterday to section 24(1) playing the role of a gatekeeper, your Honours will recall, creating a contingent liability, and we would refer the Court if we might to the analysis of the relationship between the subsections in section 24 to be found in Canute in paragraph 6.  In our submission, it is an entirely accurate analysis, of course.

Our learned friend then put to your Honours that – and came back to it this morning – that section 24(5) introduces some additional element when it refers to permanent impairment of the employee.  It is our submission that there is no additional element.  The reference in subsection (5) is if we complete the phrase, reference to “permanent impairment of the employee resulting from an injury” and that ties in directly, we say, with subsection (1).  Each of the subsections has the same elements, perhaps arranged in a different sequence; an injury, an injury to an employee resulting in impairment, obviously impairment of the employee.

There is no magic about the language in subsection (5).  It is not intended to, we would say, create some broadening of the focus when one comes to making the assessment.  In our submission, what it requires, that is, subsection (5), is that Comcare determine the degree of permanent impairment in the sense of – that is, permanent impairment of the employee – in the sense of the degree of loss of use, damage or malfunction, et cetera, for part of that employee’s body, or a part of that employee’s bodily function, and that is all it means.

Our friend said yesterday that he could not point to the concept of whole person impairment being incorporated in the Act, but said that section 24(5) and some other subsections such as 25(4) direct attention to permanent impairment of the employee, as our friend put it yesterday, though perhaps he may not have persisted with this thought, rather than permanent impairment as defined.

Now, we draw your Honours’ attention again to the reasons of this Court in Canute because we would say this very argument was put on behalf of Comcare in Canute, and it is noted in paragraph 11 of the reasons for judgment in Canute.  The first four lines:

Section 24(5) of the Act is expressed in terms of “the degree of permanent impairment of the employee”.  This expression is said by Comcare to reflect an approach of assessing impairment on a “whole person” basis.

Now, I do not think I am doing an injustice to our friend’s submissions to characterise them as essentially that submission.  That submission is then dealt by this Court.  Throughout paragraph 11 your Honours will see that it is not treated with great favour, and the Court returns to it – if I might put it this way – at the end of paragraph 13 and into paragraph 14.  At the end of paragraph 13 the Court acknowledges that:

The Guide claims –

through table 14.1 –

to import the notion of “whole person impairment” from the American Medical Association’s Guides.

However, it is important to remember that recourse to the criteria and methodologies set out in the Guide is only necessary once the key statutory criterion of the occurrence of “an injury” (which resulted in at least one permanent impairment) has been fulfilled.  The Guide is to be approached through the prism of each “injury”.

Going into paragraph 15 the Court said at the second‑last sentence:

it is not correct to say that s 24(5) imports a “whole person” approach to the determination of the degree of permanent impairment.

Our friend also referred this morning to paragraph 37 of Canute in which our friend submitted that the Court had endorsed the proposition that the Act recognises this concept.  If your Honours read paragraph 37 through to the end, the endorsement is heavily qualified, in particular the last three sentences of that paragraph.  I will leave to that to your Honours if I might. 

Now, your Honours were taken to section 28(1)(c), and our friend put the submission that that paragraph authorises the making of a guide prescribing:

methods by which the degree of permanent impairment . . . shall be expressed as a percentage. 

That is obvious because that is what the language says, but we need to focus perhaps a little more carefully on that language.  It authorises the guide to prescribe methods by which the degree of permanent impairment – that is the degree that has been determined under the criteria prescribed under paragraph (a) – shall be expressed as a percentage.  The paragraph proceeds on the basis that the degree of permanent impairment has been determined, and then it authorises the guide to prescribe a method for expressing that degree as a percentage.  In our submission it is paragraph (c) that supports table 14.1, to which the Court has been taken at least once, but it does not authorise, we say, a method by which one impairment is to be treated as the same impairment as another.

That is not a method for expressing the degree of impairment that has been determined under the guide as a percentage.  Nor does it authorise a method by which the degree of permanent impairment resulting from an injury is to be ignored.  In our submission, that is the effect which the Full Court attributed to the statement on page 5 of the guide.  It is not authorised by paragraph (c); is it not a methodology of that kind.  The language on page 5 does not contain – contrary to the submission that our friends have made – a methodological stipulation for expressing the degree of permanent impairment as a percentage.

KIEFEL J:   Mr Hanks, could you remind me, the references in the statement of agreed facts, paragraphs 6 and 11 to the 10 per cent level of impairment under table 9.5, do you say that they are expressed as impairment of the whole person, or are they 10 per cent of something else; impairment expressed in some other way?

MR HANKS:   We need to start with section 24(5), your Honour, if might.  They are the degree of permanent impairment of the employee resulting from that injury, and they are articulated under the provisions of the approved guide, and they are ‑ ‑ ‑

KIEFEL J:   But is the impairment there referred to in the statement of agreed facts, impairment as defined or impairment of the whole person?

MR HANKS:   Impairment as defined, your Honour, we believe.  That is the concept which, as we understand it, the Act employs.

KIEFEL J:   Do I take it then that the parties were not at even on a statement of agreed facts?

MR HANKS:   Why would that be, your Honour?

KIEFEL J:   Because of the submissions we have heard this morning, Mr Hanks.

MR HANKS:   I think, with respect, your Honour, it may be that the party is not ad idem at the moment.  It should not be assumed that these facts were not agreed.  The facts stand for what they state.  Our friends seek to introduce this concept of “whole person” impairment.  We say that is quite inconsistent with the process of assessment which is required by the Act.

I have taken you to the provisions.  I have taken you to the observations of this Court in Canute.  In our submission, those observations tell us that the concept of “whole person” impairment cannot stand in the way of the liability that is created to pay compensation in respect of an injury resulting in permanent impairment.  Hindsight, perhaps, your Honour, might breed regret.

KIEFEL J:   It is not the first time there has been a difficulty with the statement of agreed facts.

MR HANKS:   One also has, of course, the findings of fact made by the Tribunal, and they are simply articulated in terms of 10 per cent as assessed under table 9.5, and in our submission, table 9.5 provides for the assessment, perhaps, loss of use, or perhaps diminished function, diminution in function, but it is loss of use or diminution in function of a particular limb.

KIEFEL J:   Yes, but it says, “(Percentage Whole Person Impairment)” at the heading of table 9.5.

MR HANKS:   I think your Honour will find that that is not peculiar to table 9.5.  I think that proposition appears in each table.  I have been seeking to deal with a particular point that our friends have made about paragraph (c) of section 28(1), about it containing a methodological stipulation.  Your Honours understand that we do not accept – we dispute indeed – that the statement on page 5 of the guide is such a methodological stipulation.

Our friends also made the submission yesterday that that statement on page 5 of the guide can be seen as producing the net effect contemplated by section 28(5).  That subsection authorises the methods set out in the guide to provide for the expression of a degree of permanent impairment determined under the criteria as 0 per cent.

That is not what the statement on page 5 does.  The statement on page 5 assumes that you have the same impairment resulting from two or more injuries, and it directs that there be only one assessment of impairment in that situation.  It does not direct that the impairment resulting from one injury is to be expressed as 0 per cent completely unrelated to section 28(5).

Our friends drew a distinction between table 9.5, on the one hand, and tables 9.2 and 9.4, and drew your Honours’ attention, our friends did, to the feature of 9.2 and 9.4 which directs in turn attention to particular parts of the upper limb or particular parts of the lower limb, whereas 9.5 does not.  It treats – I think our friends put it – each lower limb as a functional unit, in contrast to the other two tables.

That distinction is one that we do not dispute, we embrace it, but it does not affect our argument.  Assume that table 9.5 identifies each limb as a functional unit, as performing a particular function.  It does not deny that there are two such units in the normal, healthy person, and each of them may be permanently impaired.  Its function may be diminished, affected as a result of an injury as is the present case.  Your Honours, those are our submissions in reply.

HAYNE J:   Yes, thank you, Mr Hanks.  The Court will consider its decision in this matter.  The Court will adjourn briefly to reconstitute.

AT 10.55 AM THE MATTER WAS ADJOURNED