Hand v Alcan Gove Pty Ltd
[2007] NTMC 41
•29 June 2007
CITATION: Hand v Alcan Gove Pty Ltd [2007] NTMC 041
PARTIES: JASON RICHARD HAND
v
ALCAN GOVE PTY LIMITED
TITLE OF COURT: Work Health Court
JURISDICTION: Work Health Court
FILE NO(s): 20614894
DELIVERED ON: 29 June 2007
DELIVERED AT: Darwin
HEARING DATE(s): 16 & 17 April 2007
JUDGMENT OF: Dr J Lowndes SM
CATCHWORDS:
PERMANENT IMPAIRMENT COMPENSATION – WHETHER SURGERY IS AN INJURY – CONSTRUCTION OF THE PERMANENT IMPAIRMENT PROVISIONS OF THE Work Health Act – WHOLE PERSON PERMANENT IMPAIRMENT – THE APPLICATION OF THE AMERICAN MEDICAL ASSOCIATION GUIDES TO THE EVALUATION OF PERMANENT IMPAIRMENT
Work Health Act sections 3, 70, 71 and 72
Pengilly v NTA [2006] NTSC 19 applied
NTA v Pengilly [2004] NTCA 4 applied
D & W Livestock Transport v Smith No 264/1992 distinguished
D & W Livestock Transport v Smith (1994) 4 NTLR 160 applied
Canute v Comcare (2006) 229 ALR 445 distinguished
REPRESENTATION:
Counsel:
Plaintiff: Mr McDonald QC
Defendant: Mr Grant QC
Solicitors:
Plaintiff: Ward Keller
Defendant: Morgan Buckley
Judgment category classification: A
Judgment ID number: [2007] NTMC 041
Number of paragraphs: 326
IN THE WORK HEALTH COURT
AT DARWIN IN THE NORTHERN
TERRITORY OF AUSTRALIA
No. 20614894
[2007] NTMC 041
BETWEEN:
JASON RICHARD HAND
Plaintiff
AND:
ALCAN GOVE PTY LIMITED
Defendant
REASONS FOR DECISION
(Delivered 29 June 2007)
Dr LOWNDES SM:
THE NATURE OF THE PROCEEDINGS AND ORDERS SOUGHT
1. The present proceedings give rise to some interesting and important issues of law. Basically, the worker seeks a number of rulings, referable to lump sum entitlements pursuant to section 71(1) of the Work Health Act:
(i) A ruling that any one, or some, or all of certain surgical procedures performed on the worker in January and September 1992, February 1993, July 1995, May 2000, May and August 2001 and February 2004 were injuries within the meaning of the definition in section 3 of the Work Health Act;
(ii) A ruling that lump sum payments made to the worker pursuant to s 71(1) of the Act in 1995 and 2002 on account of his percentage permanent impairment of the whole person arising from the injury should have been calculated at 208 x the appropriate weekly earnings rather than 104 x the appropriate average weekly earnings;
(iii) A ruling that the 20% permanent impairment of the whole person assessed in respect of the worker’s knee dysfunction set out in the report of Dr Colin G Mills dated 18 December 2005, relates to the worker’s replaced knee, which constitutes a different injury from the knee injury assessed and compensated for in 1995 and 2002, although one arising from the injury;
(iv) A ruling that each of the assessments made by Dr Mills in his report dated 18 December 2005 of 7% permanent impairment of the whole person for pain and 5% of the whole person for scarring and cosmetic defects in respect of the worker arising from the injury, are assessments in respect of permanent impairment aspects of the worker arising from the injury which had not previously been assessed or compensated for in 1995 and/ or 2002.
The worker also seeks concomitant orders, which are as follows:
(i) An order that the worker is entitled to further sums for his percentage permanent impairments of the whole person than he was paid in either or both of 1995 and 2002, in such amount as the Court determines; and
(ii) An order that the worker is entitled to further sum or sums for his current percentage permanent impairment of the whole person as assessed by Dr Mills in his report dated 18 December 2005, again in such amount as the Court determines.
2. The worker also seeks an order that the employer pay to the worker his costs of assessments conducted by Dr J Begg, Dr J Meegan and Dr G Mills in the total amount of $1,925, together with interest thereon pursuant to s 109(1) of the Act. Finally, the worker seeks an order for costs of and incidental to the proceedings.
CONSOLIDATED PLEADINGS
3. In order to assist the Court in making its determination, the Court was provided with a set of consolidated pleadings based on the Worker’s Amended Statement of Claim dated and filed 16 April 2007 and the Employer’s Amended Defence dated and filed 16 April 2007. The contents of that document are as follows:
The Statement of Claim
SC1. The Worker was born on 12 April 1968 and is currently aged 38 years.
D1. The Employer admits the allegations contained in paragraph 1.
SC2. The Employer was formerly known as Nabalco Pty Limited and changed its name to Alcan Gove Pty Limited on or about 3 June 2002.
D2. The Employer admits the allegations contained in paragraph 2.
SC3. At all material times the Employer was a body corporate capable of suing and being sued in its corporate name and style.
D3. The Employer admits the allegation contained in paragraph 3.
SC4. On or about 3 April 1990 the Worker commenced employment with the Employer as a utility serviceman within its Maintenance Department at Nhulunbuy in the Northern Territory of Australia.
D4. The Employer admits the allegation contained in paragraph 4.
SC5. On or about 8 August 1991 the Worker sustained an injury (“the injury”).
Particulars
Severely damaged left knee joint.
D5. The Employer admits the allegations contained in paragraph 5.
SC6. The Worker made a claim under the Work Health Act in respect of the injury and the claim was accepted by the Employer.
D6. The Employer admits the allegations contained in paragraph 6.
SC7. On 22 August 1991 as a consequence of the injury the Worker underwent a lateral meniscectomy to his left knee performed by orthopaedic surgeon Mr S Baddeley.
Particulars
Arthroscopy and removal of torn lateral meniscus.
D7. The Employer admits the allegations contained in paragraph 7.
SC8. On 15 October 1991, Section 11 of the Work Health Amendment Act (No. 2) 1991 came into force, amending Section 71 of the Work Health Act. This had the effect of lowering the threshold for a permanent impairment entitlement from 15% to 5%, and of doubling the multiplier of average weekly earnings from 104 x average weekly earnings to 208 x average weekly earnings.
D8. The Employer admits the allegations contained in paragraph 8.
SC9. On 8 April 1992, the Work Health Amendment Act (No. 2) 1991 Amendment Act 1992 was assented to and by Section 2 thereof it was deemed to have come into operation immediately before the commencement of the Work Health Amendment Act (No. 2) 1991, on 15 October 1991.
D9. The Employer admits the allegations contained in paragraph 9.
SC10. Section 3 of the Work Health Amendment Act (No. 2) 1991 Amendment Act 1992 repealed Section 14 of the Work Health Amendment Act (No. 2) 1991, and substituted a new Section 14 in that Act (“the New Section 14”).
D10. The Employer admits the allegations contained in paragraph 10.
SC11. The New Section 14 in sub Section (1) thereof provided that Section 11 of the Work Health Amendment Act (No. 2) 1991 applied only to and in relation to an injury suffered by a Worker after the commencement of the Work Health Amendment Act (No. 2) 1991, on 15 October 1991.
D11. The Employer admits the allegations contained in paragraph 11.
SC12. In January 1992 as a consequence of the injury, the Worker underwent a ligament reconstruction of the left knee with ligament staple fixation.
D12. The Employer admits the allegations contained in paragraph 12.
SC13. The surgery performed on the Worker’s left knee on January 1992 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D13. The Employer denies the allegations contained in paragraph 13.
SC14. On 2 September 1992 as a consequence of the injury, the Worker underwent further arthroscopy of the left knee with chrondroplasty and removal of staples from the previous reconstruction.
D14. The Employer admits the allegations contained in paragraph 14.
SC15. The surgery performed on the Worker’s left knee on 2 September 1992 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D15. The Employer denies the allegations contained in paragraph 15.
SC16. On 13 February 1993 as a consequence of the injury, the Worker underwent further arthroscopic surgery involving a revision of left and anterior cruciate reconstruction, in which the surgeon Dr R Atkinson used a segment of patellar tendon to reconstruct the anterior cruciate ligament.
D16. The Employer admits the allegations contained in paragraph 16.
SC17. The surgery performed on the Worker’s left knee on 13 February 1993 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D17. The Employer denies the allegations contained in paragraph 17.
SC18. On 24 March 1995 as a consequence of the injury, the Worker underwent steroid injections in the left knee to reduce pain and inflammation.
D18. The Employer denies the allegations contained in paragraph 18, and says that on 18 May 1995 the Worker’s left knee was infiltrated with depo-Steroid and anaesthetic.
SC19. On 11 July 1995 as a consequence of the injury, the Worker underwent further surgery, namely arthroscopy which noted a minor lesion of the femoral condyle and tibial plateau.
D19. The Employer admits the Worker underwent arthroscopy on 11 July 1995, says that the arthroscopy disclosed a minor tear of the anterior aspect of the left lateral meniscus and some changes to the femoral condyle and tibial plateau, and otherwise denies the allegations contained in paragraph 19.
SC20. The surgery performed on the Worker’s left knee on 11 July 1995 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D20. The Employer denies the allegations contained in paragraph 20.
SC21. In a medical report dated 12 September 1995, Adelaide orthopaedic surgeon, Dr Robert Atkinson advised the Work Health insurer TIO that as a consequence of the injury the Worker had a 15% permanent impairment of the whole person.
D21. The Employer admits the allegations contained in paragraph 21.
SC22. Shortly after September 1995, the Employer paid the Worker the sum of $9,901.32 purportedly being his percentage permanent impairment entitlement pursuant to Section 71 (1) of the Work Health Act.
D22. The Employer admits the allegations contained in paragraph 22.
SC23. The Employer calculated the sum of $9,901.32 by taking 15% of 104 x $634.70 being average weekly earnings in 1995.
D23. The Employer admits the allegations contained in paragraph 23.
SC24. The Worker’s correct entitlement in 1995 to payment for his percentage permanent impairment of the whole person arising from the injury in accordance with Section 71 (1) of the Work Health Act should have been calculated at 15% of 208 x $634.70, namely $19,802.64, and the Worker claims the shortfall, to be calculated on the basis of average weekly earnings in the year in which payment is made.
D24. The Employer denies the allegations contained in paragraph 24 and says that the permanent impairment payment was properly made in respect of the injury pleaded at paragraph 5.
SC25. On 10 April 1997 as a consequence of the injury the Worker underwent a further arthroscopy of the left knee to excise a fibrous band in the left patello-femoral joint and remove loose bodies in the joint, a partial meniscectomy in the joint and a chrondroplasty of the lateral compartment and patello-femoral joint articular surfaces.
D25. The Employer admits the allegations contained in paragraph 25 save that it says the procedure was performed on 17 April 1997.
SC26. The surgery performed on the Worker’s left knee on 10 April 1997 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D26. The Employer denies the allegations contained in paragraph 26.
SC27. On 10 May 2000 as a consequence of the injury, the Worker underwent further surgery namely open wedge osteotomy in an effort to restore knee function.
D27. The Employer admits the allegations contained in paragraph 27.
SC28. The surgery performed on the Worker’s left knee on 10 May 2000 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D28. The Employer denies the allegations contained in paragraph 28.
SC29. On 16 May 2001 as a consequence of the injury, the Worker underwent a further arthroscopic examination of the left knee.
D29. The Employer admits the allegations contained in paragraph 29.
SC30. Omitted.
D30. Omitted.
SC 31. The surgery performed on the Worker’s left knee on 10 May 2000 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D31. The Employer denies the allegations contained in paragraph 31.
SC32. In August 2001 as a consequence of the injury, the Worker underwent lower femoral osteotomy of the left knee involving extensive fixation by means of plates and screws.
D32. The Employer admits the allegations contained in paragraph 32.
SC33. The surgery performed on the Worker’s left knee in August 2001 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D33. The Employer denies the allegations contained in paragraph 33.
SC34. By report dated 18 July 2002 to the Territory Insurance Office, Adelaide orthopaedic surgeon, Dr David J Marshall assessed that the Worker was then suffering a 30% permanent impairment of the whole person as a consequence of the injury.
D34. The Employer admits the allegations contained in paragraph 34.
SC35. Shortly after July 2002, the Employer paid to the Worker the sum of $12,754.56 purportedly being his percentage permanent impairment entitlement pursuant to Section 71 (1) of the Work Health Act.
D35. The Employer admits the allegations contained in paragraph 35.
SC36. The Employer’s calculation of the sum of $12,754.56 was based on its reducing the 30% permanent impairment assessment to 15%, by virtue of the previous assessment of a 15% permanent impairment assessment provided by Dr Atkinson in 1995, and then allowing the Worker 15% of 104 x $817.60 being average weekly earnings in 2002.
D36. The Employer admits the allegations contained in paragraph 36.
SC37. The Employer’s calculation of the Worker’s entitlement to a lump sum by way of his percentage permanent impairment of the whole person in 2002 was incorrect. The correct calculation should have been 30% of (208 x $817.60) - $9,901.32 = $41,116.92. The Worker claims the shortfall to be calculated on the basis of average weekly earnings in the year in which payment is made.
D37. The Employer denies the allegations contained in paragraph 37.
SC38. In the alternative to the preceding paragraph, the correct calculation of the Worker’s entitlement in 2002 to a lump sum for a 30% permanent impairment of the whole person should have been 30% of (104 x $817.60) - $9,901.32 = $15,607.80. The Worker claims the shortfall to be calculated on the basis of average weekly earning in the year in which payment is made.
D38. The Employer admits the allegations contained in paragraph 38, and says that it paid the Worker the shortfall of $2,853.24 plus interest of $1,049.99, a total amount of $3,903.23, on 29 March 2006.
SC39. On 12 February 2004 as a consequence of the injury, the Worker underwent a total left knee replacement.
D39. The Employer admits the allegations contained in paragraph 39.
SC40. The surgery involving the total left knee replacement performed on 12 February 2004 was an “injury” as defined in Section 3 of the Work Health Act in that it was required because of, and it was itself, an “aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease”.
D40. The Employer denies the allegations contained in paragraph 40.
SC41. The Employer paid all the Worker’s expenses in respect of medical, hospital, radiological, anaesthetic, surgical, rehabilitation and pharmaceutical services which arose in respect of each of the surgical procedures pleaded herein, from and including 28 August 1991 to and including the total knee replacement on 12 February 2004, in accordance with the Employer’s obligations to the Worker under the Work Health Act.
D41. The Employer admits the allegations contained in paragraph 41.
SC42. Over the years following the occurrence of the injury on 8 August 1991 to and for some time after the total left knee replacement on 12 February 2004, the Worker suffered from symptoms of psychological injury as a consequence of chronic pain and incapacity for work arising from the injury.
D42. The employer does not admit the allegation contained in paragraph 42.
SC43. The Worker consulted Adelaide psychiatrist Dr Jules Begg in March 2005 for an assessment of any current percentage permanent impairment of the whole person arising out of the injury.
D43. The Employer admits the allegations contained in paragraph 43.
SC44. Dr Jules Begg provided a report dated 15 March 2005 addressed to Ward Keller setting out his assessment of the Worker’s percentage permanent impairment of the whole person as a result of psychological injury arising from the injury, and charged $715 inclusive of GST for that report.
D44. Save that it admits the Dr Begg charged $715 for the report, the employer denies the allegations contained in paragraph 44 and relies on the content of the report.
D45. Dr Begg concluded in his report dated 15 March 2005 that the Worker had previously suffered, but no longer suffered, significant symptoms of psychiatric injury as a consequence of the injury, and that he had a 0% permanent impairment of the whole person in respect of any psychological injury as a consequence of the injury.
D45. The Employer denies the allegations contained in paragraph 45 and relies on the content of the report.
SC46. After the injury on 8 August 1991 through to some time after the left knee replacement on 12 February 2004, the Worker routinely took strong analgesic medications to control pain and discomfort as a consequence of the injury.
Particulars of Medication
Anti-inflammatories and pain killers including opiates such as codeine.
D46. The Employer admits the allegations contained in paragraph 46.
SC47. As a consequence of the medication the Worker took to control his pain as a result of the injury, and in particular as a consequence of long term use of opiate based medication, the Worker suffered from severe digestive upsets, mainly in the form of chronic constipation with occasional severe diarrhoea.
D47. The Employer does not admit the allegations contained in paragraph 47.
SC48. In March 2005 the Worker consulted Adelaide physician Dr John Meegan for the purpose of obtaining an assessment of the Worker’s percentage permanent impairment of the whole person as a result of digestive problems as a consequence of the injury.
D48. The Employer admits the allegations contained in paragraph 48.
SC49. Dr John Meegan provided a report dated 17 March 2005 to Ward Keller in relation to his assessment of the Worker’s percentage permanent impairment of the whole person in respect of digestive problems as a result of the injury, and he charged $412.50 inclusive of GST for that report.
D49. The Employer admits the allegations contained in paragraph 49.
SC50. Dr John Meegan concluded in his report dated 17 March 2005 that although the Worker had previously suffered from digestive problems as a result of medication taken for pain arising from the injury, he no longer needed to take such medication and no longer suffered digestive problems to any significant extent and he had a 0% permanent impairment of the whole person as a result of digestive problems associated with the injury.
D50. The Employer denies the allegations contained in paragraph 50 and relies on the content of the report.
SC51. The Worker consulted Adelaide specialist occupational physician Dr Colin G Mills in November 2005 in order that Dr Mills might provide an assessment of the Worker’s permanent impairment of the whole person as a consequence of the injury and following the left knee replacement.
D51. The Employer admits the allegations contained in paragraph 51.
SC52. Dr Mills provided a report dated 18 December 2005 to Ward Keller providing assessments of the Worker’s percentage permanent impairment of the whole person in respect of pain, in respect of scar and cosmetic defects, and in respect of the knee dysfunction, and Dr Mills charged $797.50 inclusive of GST for the consultation and report.
D52. The Employer admits the allegations contained in paragraph 52.
SC53. Dr Mills in his report dated 18 December 2005 found that the Worker had suffered a 7% permanent impairment of the whole person as a consequence of the injury, because of pain.
D53. The Employer admits the allegations contained in paragraph 53.
SC54. Dr Mills in his report dated 18 December 2005 found that the Worker had suffered a 5% permanent impairment of the whole person as a result of the injury in respect of scarring and cosmetic defects.
D54. The Employer admits the allegations contained in paragraph 54.
SC55. Dr Mills in his report dated 18 December 2005 found that the Worker had suffered a 20% permanent impairment of the whole person on account of his persisting knee dysfunction.
D55. The Employer admits the allegations contained in paragraph 55.
SC56. Section 70 of the Work Health Act and Regulation 9 of the Work Health Regulations together prescribe the 4th edition of the American Medical Association Guides to the Evaluation of Permanent Impairment as being the prescribed guides for the purpose of performing an assessment of percentage permanent impairment of the whole person under the Work Health Act (“the prescribed Guides”).
D56. The Employer says that the Fourth Edition of the American Medical Association Guides to the Evaluation of Permanent Impairment has been the prescribed Guide since the promulgation of Regulations No 50 of 1993, and otherwise denies the allegations contained in paragraph 56.
SC57. At the rear of the prescribed Guides are Combined Values Charts for the purpose of determining the total percentage permanent impairment of the whole person in cases where more than one assessment of percentage permanent impairment is made in respect of different impairments arising out of an injury.
D57. The Employer admits the allegations in relation to the Fourth Edition, and otherwise does not admit the allegations contained in paragraph 57.
SC58. When the Combined Values Chart in the prescribed Guides is applied to Dr Mill’s assessment of 20% for the knee dysfunction and 7% for pain, a resultant is achieved of 26%.
D58. The Employer admits the allegations in relation to the Fourth Edition, and otherwise does not admit the allegations contained in paragraph 58.
SC59. When the Combined Values Chart in the prescribed Guides is applied to the resultant of 26% and to Dr Mill’s assessment of 5% in respect of scarring and cosmetic defects, a further resultant is achieved of 30%.
D59. The Employer admits the allegations in relation to the Fourth Edition, and otherwise does not admit the allegations contained in paragraph 59.
SC60. When the Combined Values Chart of the prescribed Guides is applied to Dr Mill’s assessment of 7% for pain and 5% for scarring and cosmetic defects, a resultant is achieved of 12%.
D60. The Employer admits the allegations in relation to the Fourth Edition, and otherwise does not admit the allegations contained in paragraph 60.
SC61. In respect of the assessment of the Worker’s percentage impairment of the whole person carried out in 2005 by Dr Mills, the Worker claims to be entitled to a further lump sum payment pursuant to Section 71 (1) of the Work Health Act being 30% of (208 x $1,039.00 being average weekly earnings in 2006) = $64,833.60, or 30% of (208 x average weekly earnings in the year in which payment is made).
D61. The Employer denies the Worker has an entitlement as alleged in paragraph 61 or at all.
SC62. In the alternative to the preceding paragraph, the Worker claims to be entitled to a further lump sum pursuant to section 71 (1) of the Work Health Act being 30% of (208 x $1,039.00) less the 2002 payment of $12,754.56 and less the 1995 payment of $9,901.32 = $42,177.72.
D62. The Employer denies the Worker has an entitlement as alleged in paragraph 62 or at all.
SC63. In the further alternative to the two preceding paragraphs, the Worker claims to be entitled to a further payment pursuant to Section 71 (1) of the Work Health Act in respect of the previously unassessed and previously uncompensated 7% for chronic pain and 5% for scarring, being 12% of (208 x $1,039.00) = $25,933.44, or 12% of (208 x average weekly earnings in the year in which payment is made).
D63. The Employer denies the Worker has an entitlement as alleged in paragraph 63 or at all.
SC64. The Worker has sought payment by the Employer of a further lump sum pursuant to Section 71 (1) of the Work Health Act in respect of the assessments of permanent impairment of the whole person in each of 1995, 2002 and 2005, and has also sought recovery of his costs in obtaining the three reports relevant to determining the assessments in 2005.
Particulars
23 February 2006 – letter from Ward Keller for the Worker to Hunt & Hunt for the Employer
D64. The Employer admits the allegations contained in paragraph 64.
SC65. The Employer declined to make any further payment to the Worker, other than an incorrectly calculated payment of $2,853.24 in respect of the incorrect calculation arising from the permanent impairment payment made in 2002, and has declined to pay the Worker his costs arising out of obtaining the up to date permanent impairment assessments in 2005.
Particulars
23 March 2006 – letter Hunt & Hunt for the Employer to Ward Keller for the Worker
D65. The Employer admits that it has declined to make any further payment to the worker in respect of permanent impairment, save and except the payment pleaded at paragraph 38 hereof and says that it has paid the Worker his costs arising out of obtaining the permanent impairment assessments in 2005.
Particulars
(a) 5 December 2006 – letter Hunt & Hunt for the Employer to Ward Keller for the Worker.
(b) 15 December 2006 – letter Hunt & Hunt for the Employer to Ward Keller for the Worker.
SC66. The Employer did not make any application pursuant to Section 72 (3) of the Work Health Act for any reassessment of the percentage impairments of the whole person determined by Dr Colin Mills, within 28 days or at all. Solicitors for the Worker and the Employer thereafter engaged in discussions in writing relevant to the legal issues arising from the circumstances as pleaded herein.
Particulars
(a) 28 March 2006 – letter Ward Keller for the Worker to Hunt & Hunt for the Employer.
(b) 6 April 2006 – letter Hunt & Hunt for the Employer to Ward Keller for the Worker.
(c) 12 April 2006 – letter Ward Keller for the Worker to Hunt & Hunt for the Employer.
(d) 19 April 2006 – letter Hunt & Hunt for the Employer to NT WorkSafe in relation to no formal mediation being undertaken.
D66. The Employer admits that it did not make any application pursuant to section 72 (3) of the Work Health Act and otherwise denies the allegations contained therein.
SC67. The Worker seeks the following remedies:
67.1 A ruling that any one, or some, or all of the surgical procedures undergone by the Worker in January 1992, September 1992, February 1993, July 1995, April 1997, May 2000, May 2001, August 2001 and February 2004, were injuries within the meaning of the definition in Section 3 of the Work Health Act.
67.2 A ruling that the calculations in each of 1995 and 2002 of the Worker’s entitlements to a lump sum pursuant to Section 71 (1) of the Work Health Act on account of his percentage permanent impairment of the whole person arising from the injury should have been calculated at 208 x the appropriate average weekly earnings rather than 104 x the appropriate average weekly earnings.
67.3 A ruling that the 20% permanent impairment of the whole person assessed in respect of the Worker’s knee dysfunction set out in the report of Dr Colin G Mills dated 18 December 2005, relates to the Worker’s replaced knee which is a different injury from the knee injury assessed and compensated for in 1995 and 2002, although one arising from the injury.
67.4 A ruling that each of the assessments made by Dr Colin G Mills in his report of 18 December 2005 of 7% permanent impairment of the whole person for pain and 5% of the whole person for scarring and cosmetic defects in respect of the Worker arising from the injury, are assessments in respect of permanent impairment aspects of the Worker arising from the injury which had not previously been assessed or compensated for in 1995 and/or 2002.
67.5 An Order that the Worker is entitled to further sums for his percentage permanent impairments of the whole person than he was paid in either or both of 1995 or 2002, in such amount as this Honourable Court determines.
67.6 An Order that the Worker is entitled to a further sum or sums for his current percentage permanent impairment of the whole person as assessed by Dr Colin G Mills in his report dated 18 December 2005, in such amount as this Honourable Court determines.
67.7 An Order that the Employer pay to the Worker his costs of the assessments carried out in 2005 by Dr Julian Begg, Dr John Meegan and Dr Colin G Mills in the total sum of $1925.00.
67.8 An Order that the Employer pay interest pursuant to Section 109(1) of the Work Health Act in respect of the sum of $1,925.00, calculated from and including 24 February 2006 to the date of payment of the sum of $1,925.00, at 10.5% per annum or such other rate as this Honourable Court might determine.
67.9 An Order that the Employer pay the Worker’s costs of and incidental to these proceedings and of and incidental to the dispute giving rise to these proceedings at 100% of the Supreme Court Scale to be taxed in default of agreement.
D67. The Employers denies that the worker is entitled to relief as claimed in paragraph 67 or at all.
CHRONOLOGY
4. The Court was also provided with a chronology of material events and relevant legislative changes to the Work Health Act to facilitate its adjudicative task. That chronology is reproduced below:
| 12 April | 1968 Worker born. Currently 38 years old. |
| 3 April 1990 | Worker commenced employment with Employer as a utility serviceman. |
| 8 August, 1991 | Worker sustained an injury namely, severely damaged left knee joint (“the injury”). Worker made a claim under the Work Health Act which was accepted by Employer. |
| 22 August 1991 | Worker underwent a lateral meniscectomy to his left knee as a result of the injury. The Worker underwent an arthroscopy and removal of a torn lateral meniscus. |
| 15 October, 1991 | Section 11 of the Work Health Amendment Act (No 2) 1991 came into force amending section 71 of the Work Health Act. |
| 8 April, 1992 | The Work Health Amendment Act (No 2) 1991 Amendment Act 1992 was assented to. By Section 2 thereof it was deemed to have come into operation immediately before the commencement of the Work Health Amendment Act (No 2) 1991, on 15 October, 1991. |
| January, 1992 | As a consequence of the injury the Worker underwent a ligament reconstruction of the left knee with ligament staple fixation. |
| 2 September, 1992 | As a consequence of the injury the Worker underwent further arthroscopy of the left knee with chondroplasty and removal of staples from the previous reconstruction |
| 13 February 1993 | As a consequence of the injury the Worker underwent further arthroscopic surgery involving a revision of left and anterior cruciate reconstruction in which surgeon Dr R Atkinsonson used a segment of patelloas tendon to reconstruct the anterior cruciate ligament. |
| 24 March 1995 | Worker undergoes steroid injection treatment to left knee which involved infiltration. |
| 11 July 1995 | The Worker underwent further surgery which noted a minor tear/lesion of the femoral and tibial plateau. |
| 12 September 1995 | Medical report of orthopaedic surgeon Dr Robert Aitkenson advising TIO that [as a consequence of the injury], the Worker had a 15% permanent impairment of the whole person. |
| Shortly after | |
| September 1995 | Employer paid the worker the sum of $9,901.32 purportedly being his percentage permanent impairment entitlement pursuant to Section 71 (1) of the Work Health Act. The Employer calculated the sum of $9,901.32 by taking 15% of 104 x $634.70 being average weekly earnings in 1995. |
| 10 April, 1997 | As a consequence of the injury the Worker underwent a further arthroscopy of the left knee to excise a fibrous band in the left patello-femoral joint and remove loose bodies in the joint, a partial meniscectomy in the joint and a chondroplasty of the lateral compartment and patello-femoral joint articular surfaces. |
| 10 May, 2000 | As a consequence of the injury, the Worker underwent further surgery namely open wedge osteotomy in an effort to restore knee function. |
| 16 May, 2001 | As a consequence of the injury, the Worker underwent a further arthroscopic examination of the left knee and underwent a repeat tibial osteotomy of the left knee. |
| August, 2001 | As a consequence of the injury, the Worker underwent lower femoral osteotomy of the left knee involving extensive fixation by means of plates and screws. |
| 18 July 2002 | Report to TIO of Dr David J Marshall assessed Worker as having a 30% permanent impairment of the whole person as a consequence of the injury. |
| Shortly after July | |
| 2002 | Employer paid to the Worker the sum of $12,754.56 purportedly being his percentage permanent impairment entitlement pursuant to Section 71 (1) of the Work Health Act. |
| 12 February, 2004 | As a consequence of the injury, the Worker underwent a total knee replacement. |
| March, 2005 | Worker consults Dr Jules Begg psychiatrist. |
| 15 March, 2005 | Report of Dr Jules Begg setting out his assessment of the Worker’s percentage impairment of the whole person as a result of psychological injury arising from injury. |
| March 2005 | Worker consults Adelaide physician Dr John Meegan. |
| 17 March 2005 | Report of Dr John Meegan in relation to his assessment of the Worker’s percentage permanent impairment of the whole person in respect of digestive problems. |
| November 2005 | Worker consults occupational physician Dr Colin G. Mills in order that he might provide an assessment of the Worker’s permanent impairment of the whole person as a consequence of the injury and following the left knee replacement. |
| 18 December 2005 | Dr Mills provides a report to Ward Keller providing assessments of the Worker’s percentage permanent impairment of the whole person in respect of pain, in respect of scar and cosmetic defects and in respect of knee dysfunction. Dr Mills found that the Worker suffered a 7% permanent impairment of the whole person as a consequence of the injury because of pain, 5 % permanent impairment of the whole person as a result of the injury in respect of scarring and cosmetic defects, 20% permanent impairment of the whole person on account of his persisting knee dysfunction. |
ADMITTED FACTS
5. There was no dispute as to the previous permanent impairment payments made to the worker:
• In his report dated 12 September 1995, Dr Atkinson, an orthopaedic surgeon, assessed the worker’s permanent impairment at 15% of the whole person. In or about September 1995 the worker received from the employer the sum of $9,901.32 on account of that assessment. That figure was arrived at by applying the then statutory formula: 15% x 104 x 634.70(average weekly earnings).
• In his report of 18 July 2002, Dr Marshall, an orthopaedic surgeon, calculated the worker’s permanent impairment at 30% of the whole person. In accordance with that assessment, in or about July 2002, the employer paid the worker a further permanent impairment payment of $12,754.56. Average weekly earnings in 2002 were $817.60. Accordingly, the formula applied was 15% (the additional impairment) x 104 x $817.60.
6. It is also agreed between the parties that in his report dated 18 December 2005, Dr Mills, occupational physician, assessed the worker’s permanent impairment at 7% of the whole person with respect to pain, 5% of the whole person in relation to scarring and cosmetic deficits and 20% of the whole person in respect of persisting knee dysfunction.
THE COURT BOOK
7. With the consent of both parties a “Court book” was tendered (Exhibit 1). The exhibit contained the following documents:
• Medical reports of Dr Robert Atkinson, Orthopaedic Surgeon, dated 8 June 1995 and 12 September 1995.
• Medical reports of Dr David Marshall, Orthopaedic Surgeon, dated 6 May 2002, 5 July 2002 and 18 July 2002.
• Medical report of Dr Jules Begg, Psychiatrist, dated 15 March 2005.
• Medical report of Dr John Meegan , Physician, dated 17 March 2005.
• Medical report of Dr Colin G Mills, Occupational Physician, dated 18 December 2005.
• American Medical Association (AMA) Guides to the Evaluation of Permanent Impairment (4th ed) – Combined Values Chart.
8. The Court Book also contained various pieces of legislation:
• Work Health Act (NT) Part V Division 3 Subdivision C – Compensation for Permanent Impairment (pre 15 October 1991 – before the commencement of the Work Health Amendment Act (No 2) 1991.
• Work Health Act (NT) Part V Division 3 Subdivision 3 Subdivision C – Compensation for Permanent Impairment (post 15 October 1991 – after the commencement of the Work Health Amendment Act (No 2) 1991.
• Work Health Amendment Act (No 2) 1991 (No 59 of 1991).
• Work Health Amendment Act (No 2) 1991 Amendment Act 1992 (No 8 of 1992).
THE RELEVANT LEGISLATION AND STATUTORY PROVISIONS
9. The relevant parts of the current scheme for compensation for permanent impairment are as follows:
Section 70: Definition
In this Subdivision ‘permanent impairment’ means an impairment or impairments assessed, in accordance with the prescribed guides, as being an impairment, or combination of impairments, of not less than 5% of the whole person.
Section 71: Compensation for Permanent Impairment
“(1) In addition to any other compensation payable under this Part, a worker who suffers permanent impairment assessed at a percentage of the whole person equal to not less than 15% shall, subject to subsection (2), be paid compensation equal to that assessed percentage of 208 times average weekly earnings at the time the payment is made.
(2)…
(3) In addition to any other compensation payable under this Part, where a worker suffers permanent impairment assessed at a percentage of the whole person equal to less than 15%, the worker shall be paid compensation equal to the percentage specified in column 2 of the Table to this section of the relevant assessed percentage of permanent impairment specified opposite in column 1 of 208 times average weekly earnings at the time the payment is made.
TABLE
Column 1 | Column 2 |
Degree of permanent Impairment | Percentage of compensation payable |
Not less than 5% but less than 10% | 2 |
10% | 3 |
11% | 4 |
12% | 6 |
13% | 8 |
14% | 12 |
(4)….
Section 72: Assessment of permanent impairment
…(5) The costs incurred in carrying out an assessment or reassessment under this section shall be paid by the employer.
10. In order to contextualise the worker’s application it is necessary to set out the legislative history of the permanent impairment provisions of the Work Health Act.
11. The permanent impairment provisions were substantially amended by the Work Health Amendment Act (No 2) 1991. The amendments took effect on 15 October 1991. As at the date of the worker’s injury – 8 August 1991- the permanent impairment provisions were as follows:
1. Section 70 of the Act defined “permanent impairment” as meaning “ an impairment or impairments assessed, in accordance with the prescribed guides, as being an impairment, or combination of impairments, of not less than 15% of the whole person”.
2. Section 71(1) provided that “in addition to any other compensation payable under this Part, a worker who suffers permanent impairment assessed at a percentage of the whole person equal to not less than 15% shall, subject to subsection (2), be paid compensation equal to that assessed percentage of 104 times average weekly earnings at the time the payment is made”.
3. Section 71(2) provided that “ a worker who suffers permanent impairment assessed at not less than 85% of the whole person shall be paid compensation of 104 times average weekly earnings at the time the payment is made”.
12. The other difference was that under the previous regime there was no table in relation to impairments between 5% and 14%.
13. As at the date of the worker’s injury, the prescribed guides was the second edition of the American Medical Association (AMA) Guides to the Evaluation of Permanent Impairment . With the passage of Regulations 22 of 1993, the third edition of the AMA Guides became the prescribed guides. Following the passage of Regulations 50 of 1993 the 4th edition became the prescribed guides, which has current application.
14. As succinctly put by Mr Grant QC, the employer’s counsel, “the transitional provisions contained in backnote 2 to the Act, as subsequently amended by the Work Health Amendment Act (No 2) 1991 Amendment Act 1992, provide relevantly that the amendments to the permanent impairment regime apply only to and in relation to an injury suffered by a worker after the commencement of the amending legislation (ie 15 October 1991)”.
15. Returning to the relevant provisions of the Act, s 3 defines “impairment” as meaning “a temporary or permanent bodily or mental abnormality or loss caused by an injury”.
16. The term “injury” is defined in s 3 to mean:
A physical or mental injury arising before or after the commencement of the relevant provision of this Act out of or in the course of his or her employment and includes –
(a) a disease; and
(b) the aggravation, acceleration, exacerbation, recurrence or deterioration of a pre-existing injury or disease,
but does not include an injury or disease suffered by a worker as a result of reasonable disciplinary action taken against the worker or failure by the worker to obtain a promotion, transfer or benefit in connection with the worker’s employment or as a result of reasonable administrative action taken in connection with the worker’s employment.
17. Section 53 of the Act provides relevantly that where a worker suffers an injury that results in or materially contributes to his or her impairment, there is payable by the employer to the worker such compensation as is prescribed. That compensation is prescribed by ss 70, 71 and 72 of the Act.
THE MEDICAL EVIDENCE
18. It is proposed to set out the salient aspects of each of the medical reports relied upon by the worker in these proceedings.
The medical reports of Dr Atkinson
19. In his report dated 8 June 1995 Dr Atkinson confirmed the prior diagnosis, namely that of “anterior cruciate reconstructed knee, articular surface degeneration particularly laterally with the possibility of a neuroma in the lateral scar”. The doctor proffered a satisfactory prognosis, although precluding heavy lifting, weight bearing work activities on rough and uneven ground. He attributed the worker’s symptoms to the work incident of August 1991. He recommended no further treatment. Although the doctor considered that the worker’s condition may improve regarding his recent pain, he believed his underlying symptoms would not improve. He expressed agreement with Dr Cornish’s assessment of the level of the worker’s permanent disability which was set at 20% for the left lower limb.
20. In his second report dated 12 September 1995, Dr Atkinson stated that he had reviewed the worker on 6 July 1995. He then noted that the worker continued to experience lateral pain and was tender on the lateral joint line of the left knee. The doctor noted some changes to the articular surface and agreed with Dr Cornish that a further arthroscopy was reasonable. The arthroscopy was performed on 11 July 1995, noting a minor tear of the anterior aspect of the left lateral meniscus, as well as some changes to the femoral condyle and tibial plateau. Post operatively, the worker was reviewed on 2 August 1995, showing good progress.
21. Dr Atkinson reviewed the worker on 30 August 1995. His left knee was found to be satisfactory. It showed stability and the recent arthroscopy revealed a stable reconstruction, with minor changes to the surface and a relatively minor meniscus tear. The doctor advised the worker that he would not be symptom free, bearing in mind the nature of the injury.
22. Dr Atkinson concluded his report with the following opinion:
As an overall assessment of permanent residual disability, I would consider this patient has a 35% loss of function of the left knee in total and I would translate that into 15% permanent impairment of the body as a whole, resulting from his work injury.
The medical reports of Dr Marshall
23. In his report dated 6 May 2002 Dr Marshall noted that the worker had undergone further surgery to his knee in August 2001. He remarked that the osteotomy carried out had been slow to unite, but was now progressing well. He noted that the worker continued to have symptoms referable to his arthritic knee, but at this stage no further treatment was envisaged, though ultimately the worker may require a total knee arthroplasty.
24. Dr Marshall stated that the current diagnosis is persisting symptoms as a result of the progressive nature of the worker’s osteoarthritis. The doctor noted that as a result of the recent surgery the alignment of the worker’s leg was satisfactory. However, he remarked that the surgery had not been satisfactory in that the worker experienced continuing symptoms. Recent x-rays revealed that the osteotomy was uniting well.
25. Dr Marshall expressed the opinion that the worker was permanently restricted in relation to his previous work and would never be able to be involved in heavy labouring work in the future.
26. In his second report dated 5 July 2002, Dr Marshall stated that he had reassessed the worker’s whole body disability according to the AMA Guidelines Fourth Edition, and had calculated the worker’s whole body impairment at 30%.
27. In his third report dated 18 July 2002, Dr Marshall referred the worker’s compensation insurer to various parts of the AMA Guidelines by way of explaining his calculation of 30% whole body impairment.
The medical report of Dr Begg
28. In his report of 15 March 2005 Dr Begg, after reviewing the worker’s history, reported that from the time of his injury until the knee replacement in 2004, the worker had suffered repeated episodes of a significant level of depression. Dr Begg’s opinion, as at the date of his report, was that the worker did not currently suffer from depression. He was of the view that the worker did not suffer from a psychiatric condition, and for the purpose of determining compensation his psychological state could be considered to be stable.
The medical report of Dr Meegan
29. In his report dated 17 March 2005, Dr Meegan reviewed the worker’s history. The doctor reported that the worker now only suffers mild and intermittent knee pain, having shown a marked improvement since the total knee replacement.
30. The results of his examination of the worker were as follows:
On examination there was normal gait. There is a large anterior and lateral scar at the knee about 30 cm in length for each scar. There is left quadriceps wasting. There is some swelling of the knee in relation to the knee replacement. There is bilateral knee valgus and a fixed deformity at the left knee of about 5 degrees and flexion was limited to about 90 degrees. He was not complaining of knee pain today without specific tenderness at the knee although the knee was warm to touch compared to the right knee.
31. Dr Meegan concluded that there was no whole person impairment in relation to liver function, stomach or digestion.
The medical report of Dr Mills
32. In his report dated 18 December 2005, Dr Mills reported on the worker’s symptom history, his surgical history and his present symptoms regarding his head, shoulders, elbows, wrists, mid back, low back, hips, right knee and left knee.
33. With respect to his left knee symptoms Dr Mills stated that the worker suffers “pain 50% of the time, 25% severe, pain from 2 to 3 out of 10 on a scale of 10 aggravated by steps, stairs, uneven surfaces, inclined pains and operating of clutches on some vehicles”.
34. Dr Mills reported that the worker was unable to “run, jump, hop, skip, ride a bicycle, kick or play football or play active sport with his children”.
35. The doctor stated that in the past the worker’s pain had required him to take methadone and morphine under the care of Dr Meegan. His only current medication was panadeine forte and beers at night.
36. Dr Mills reported that the worker was depressed and tearful. He also complained of diminished libido.
37. The doctor’s examination of the worker revealed the following:
Straight leg raising right 90 degrees, left 80 degrees. The right knee was normal, the left knee had 2 linear scars, one 36 cm long the other 30cm long. There was a 10 cm long scar over the left hip from a bone graft harvester.
A 2 cm oblique scar over the medial aspect of the right knee, medial aspect and several scars consistent with puncture wounds. The range of extension of the knee was from 95 degrees and he was unable to walk on tip toe.
38. Under the heading “Comment” Dr Mills made the following assessments in relation to the worker:
Mr Jason Hand had disabilities for:
pain; he used a narcotic analgesia and alcohol to control pain
scarring; extensive scars around right knee, small scars on the left hip
right knee dysfunction.
These estimated as:
Pain: Using the 4th Edition American Medical Association Guides to the Evaluation of Impairment Chapter 15, 7%.
Impairment for Physicians Chapter 13, 5%.
Right knee dysfunction: Using the 4th Edition American Medical Association Guide to Impairment for Physicians, Chapter 13, Table 64, 20%
39. Under the heading “Opinion” Dr Mills stated:
Mr Jason Hand had significant sequelae from an accident in Darwin in 1991. He has been left with:
leg pain, that affects his capacity for enjoying life and working and increases the risk of a recurrence of his depression
cosmetic scars on the right knee and left hip
right knee dysfunction.
He will require further surgery to the right knee, each expected to last up to a maximum of 15 years. They may well need to be replaced much earlier which means there will be at least several more surgical procedures to the right knee.
40. Under the heading “His Disability” Dr Mills made the following assessments:
7% whole body for pain
5% whole body for scar and the cosmetic effects
20% whole body for right knee dysfunction.
41. Dr Mills’ report concluded thus:
In forming my opinion I assumed the history given by Jason Hand accurate and acknowledge the opinions you provided.
I, Colin Mills, declare that I have made all the enquiries which I believe are desirable and appropriate and that no matters of significance other than those specified, which I regard as relevant have, to my knowledge, been withheld from the Court.
THE FOURTH EDITION OF THE AMERICAN MEDICAL ASSOCIATION GUIDES TO THE EVALUATION OF PERMANENT IMPAIRMENT
42. It is useful to set out those parts of the fourth edition of those Guides that are relevant to the assessments made by the medical practitioners in this case.
43. Chapter 2 of the Guides deals with “Records and Reports”. This Chapter “describes how the Guides can help provide consistent and reliable acquisition, analysis, communication and utilisation of medical information”. The Chapter states that “the major objective of the Guides is to define the assessment and reporting of medical impairments so that physicians can collect, describe and analyse information about impairments in accordance with a single set of standards”.
44. According to the Chapter (2.1), “the first step in assessing an individual’s impairment is gathering thorough and complete historical information on the medical condition(s) and then carrying out a medical evaluation supported by appropriate tests and diagnostic procedures”. The Chapter states that “a proper medical evaluation accurately documents the individual’s clinical status”.
45. The second step is an analysis of the history and the clinical and laboratory findings “to determine the nature and extent of the impairment or dysfunction of the affected body part or system”.
46. The third step is “comparing the results of the analysis with the criteria specified in the Guides for the particular body part, system or function”.
47. The Chapter (2.2) establishes a set of rules for evaluating permanent impairment:
In general, the physician should estimate the extent of the patient’s primary impairment or impairing condition, that is, the condition that seems to be of most concern to the patient. The estimate should be based on current findings and evidence. It may be necessary to refer to the criteria and estimates in several chapters if the impairing condition involves several organ systems. In that case, each organ system impairment should be expressed as a whole-person impairment; then the whole-person impairments should be combined by means of the Combined Values Chart (p 322). The general philosophy of the Combined Values Chart is explained in Section 3.1, Chapter 3(p 15).
If the physician believes that the patient has two significant, unrelated conditions and that the extent of each should be estimated, this may be done. The whole – person impairment estimates for the two separate conditions then would be combined into an overall impairment estimate using the Combined Values Chart.
48. The Chapter proceeds to say that “a 95% to 100% whole person impairment is considered to represent almost total impairment, a state that is approaching death”.
49. Under the sub heading “Pain” the Guide states:
In general, the impairment percents shown in the chapters that consider the various organ systems make allowance for pain that may accompany the impairing condition. Chronic pain, also called the chronic pain syndrome, is evaluated as described in the chapter on pain (p 303).
50. According to Chapter 2 (2.3) the Guides “attempt to take into account all relevant considerations in estimating or rating the severity and extent of permanent impairment and the effects of the impairment in terms of the individual’s everyday activities”. It is stated that “an impairment should not be considered ‘permanent’ until the clinical findings, determined during a period of months, indicate that the medical condition is static and well stabilised”.
51. Chapter 2 (2.4) also deals with the preparation of reports:
A clear, accurate and complete report is essential to support a rating of impairment.
52. The following information is expected to be included in the report – medical evaluation, analysis of the findings and comparison of the results of analysis with the impairment criteria.
53. The medical evaluation should include “a narrative history of the medical condition(s) with specific reference to onset and course of the condition, symptoms, findings on previous examination(s), treatments, and responses to treatment, including adverse effects”.
54. The evaluation should also include the results of the most recent clinical evaluation.
55. The report should contain an assessment of the patient’s current clinical status together with “a statement of plans for future treatment, rehabilitation and re-evaluation.
56. The report should contain diagnoses and clinical impressions.
57. Finally the report should estimate the expected date of full or partial recovery.
58. In relation to the analysis of findings, the report should provide “an explanation of the impact of the medical condition(s) on life activities”. The types of affected activities should be listed.
59. The “medical basis for concluding that the condition and the patient’s symptoms have or have not become stable” should be explained.
60. The chapter goes on to say that “an explanation should be given of the medical basis for concluding that the individual is or is not likely to suffer sudden, subtle or other incapacitation as a result of a change in the condition”.
61. The report should also provide “an explanation of the medical basis for concluding that the individual is or is not likely to suffer injury or harm or further impairment by engaging in activities of daily living or other activities necessary to meet personal, social and occupational demands”.
62. Finally, the analysis of findings should include the following:
Any conclusion that restrictions or accommodations are or are not warranted with respect to daily activities or activities that are required to meet personal, social and occupational demands should be explained. If restrictions because of risks to the patient or others, or accommodations, are necessary, an explanation of their expected outcome and value should be provided.
63. In relation to the comparative exercise Chapter 2 prescribes the following approach:
1. A description should be given of specific clinical findings related to each impairment, with reference to how the findings relate to and compare with the criteria described in the applicable Guides chapter; reference should be made to the absence of, or the examiner’s inability to obtain, pertinent data.
2. An explanation of each impairment value with reference to the applicable criteria of the Guides should be included.
3. A summary list of impairment estimates in percents should be included.
64. The next relevant part of the Guides is Chapter 13, which deals with the subject of “Skin”.
65. The preface to Chapter 13 reads:
This chapter provides criteria for evaluating the effects of permanent impairments of the skin and its appendages. These are considered especially in terms of the effects they may have on an individual’s ability to carry out daily activities, including those related to employment.
66. The Chapter (13.1) defines “permanent impairment of the skin” as “any anatomic or functional abnormality or loss that persists after medical treatment and rehabilitation and after a length of time sufficient to permit regeneration and other physiological adjustments”. The Chapter goes on to say that “a permanent impairment is unlikely to change in the near future”.
67. The Chapter (13.2) proceeds to deal with the methods of evaluating impairment:
In evaluation of a permanent impairment related to a skin disorder, the actual functional loss should be the prime consideration, although the extent of the cosmetic involvement also may be important. Impairments of other body systems, for instance, behavioural problems restriction of motion or ankylosis of joints and respiratory, cardiovascular, endocrine or gastrointestinal tract disorders, may be associated with skin impairments. When there is a permanent impairment of more than one body system, the extent of the whole -person impairment related to each system should be evaluated, and the estimated impairment percentages should be combined using the Combined Values Chart to determine the person’s total impairment…
In determining the appropriate impairment class (Table 2, p 280) for an affected individual, the physician should primarily consider the impact of the skin condition on the individual’s daily activities.
68. Chapter 13 (13.5) specifically deals with scars.
69. Chapter 15 deals with the assessment of pain and makes the following basic assumptions:
The Guides is intended to provide a standard method of analysis for evaluation of impairing conditions. Fundamental to the Guides is that it applies only to permanent impairments, which are defined as those that are stable and unlikely to change in future months because of medical or surgical therapy…
In general, the impairment percents given in the tables and figures applicable to permanent impairments of the various organ systems include allowances for pain that may occur with those impairments.In considering pain, it is prudent to list the following assumptions:
1. Pain evaluation does not lend itself to strict laboratory standards of sensitivity, specificity and other scientific criteria.
2. Chronic pain is not measurable or detectable on the basis of the classic, tissue-oriented disease model.
3. Pain evaluation requires acknowledging and understanding a multifaceted, biopsychosocial model that transcends the usual, more limited disease model.
4. Pain impairment estimates are based on the physician’s training, experience, skill and thoroughness. As with most medical care, the physician’s judgment about pain represents a blend of the art and science of medicine, and the judgment must be characterised not so much by scientific accuracy as by procedural regularity.
70. The Chapter goes on to deal with the task of assessing impairment due to pain:
The important task of evaluating impairment due to pain is difficult but not impossible. Physicians initially may feel uncomfortable evaluating pain, but they regularly employ similar methods and approaches in arriving at diagnostic and therapeutic judgments. Physicians generally are comfortable making decisions on the basis of probabilities backed up by experience and stated in terms of reasonable medical certainty. Pain should be evaluated by physicians who are conversant with the disorder.
71. Chapter 15(15.2) defines “pain”. After dealing with various definitions of “pain” the Guide states:
Embodied in the definitions above are the following concepts. Pain is subjective and cannot be measured objectively. Pain evokes negative psychologic reactions such as fear, anxiety and depression. Pain is perceived consciously and is evaluated in light of past experience. People usually regard pain as an indicator of physical harm, despite the fact that pain can exist without tissue damage, and tissue damage can exist without pain.
72. The Chapter (15.3) then deals with “Pain, Impairment and Disability”:
The Guides defines impairment as the loss, loss of use or derangement of any body part, system or function. Thus, impairment is defined on an anatomic, physiologic or psychological basis. This definition operates at the organ level and presumes a disease model that involves endogenous systems and generally is independent of the external milieu. In this narrow context, it would be difficult to consider pain an impairment.
But the Guides interprets the definition of impairment to involve also interfering with the individual’s performance of daily activities. In this broader context, impairment is at the level of the individual, is based on the illness model and is viewed as being dependent on personal needs and the demands of the external milieu. In this context, pain may be viewed as an impairment that should be assessed according to the individual’s residual functional capacity. Chronic pain and pain-related behaviours are not, per se, impairments, but they should trigger assessments with regard to ability to function and carry out daily activities.
73. “Functional capacity evaluation” involves “examining an individual as the individual performs activities in a structured setting”. The Guides go on to say:
It does not necessarily reflect what the individual should be able to do, but rather what the individual can do or is willing to do at a given time. Functional capacity depends especially on motivation, cognitive awareness, behavioural factors, and sincerity of effort, and these characteristics have a major impact on the functional capacity assessment (FCA).
The functional capacity assessment, which is performed by or under the supervision of the physician, varies according to the physician’s training, experience, skill, competence and understanding of the assessment processes. A great need exists for a valid, accurate, reliable and relevant instrument for performing the FCA, one that is based on the full range of abilities and activities of normal persons.
74. Chapter 15 (15.6) deals with the clinical assessment of “pain”. This part of the Guides begins with the following statement:
Assessing the magnitude of the patient’s pain and pain-related impairment requires a multidisciplinary approach based on the bio- psychosocial model. In general, the assessment calls for the traditional approach of the physician. However, assessing chronic pain is a complex and lengthy process that usually requires hours if not days to complete. In difficult cases, it may be appropriate to enlist the aid of physicians specialising in pain medicine.
75. The Chapter then prescribes the steps that should be taken to guide the examination of a patient with a complex pain problem:
1. Review all available medical records and diagnostic studies. Communication with previous health providers may be needed.
2. Obtain a complete medical history from the patient, speaking with persons in close contact with the patient as needed. Include a family, work and social activities history. List affected daily activities (see p 313).
3. Document all current complaints and pain history. The pain history should include a description of onset, location, quality, progression, character, intensity, variability, frequency, duration, migration pattern, precipitating and aggravating factors, epi-phenomena, treatment, medications and other interventions used and results.
4. Perform a complete physical and neurologic examination.
5. Arrange appropriate ancillary studies, for instance, roentgenographic, magnetic resonance imaging and electromyographic studies.
6. Psychological testing is an integral part of evaluating pain.
7. Formulate a diagnostic impression based on the accumulated information. This assessment should refer to the cause and classification of the pain, description of the bio –psychosocial impact and prognosis.
8. Estimate the extent of the pain and impairment using the procedures described in section 15.9 (p 311) and other parts of the Guides as appropriate.
76. Chapter 15 goes on to address the 8 diagnostic characteristics of chronic pain – duration, dramatisation, diagnostic dilemma, drugs, dependence, depression, disuse and dysfunction. According to the Guides, the presence of two or more of those characteristics is considered to establish a presumptive diagnosis of chronic pain syndrome.
THE WORKER’S SUBMISSIONS
The written submissions
77. Mr McDonald QC submitted that the lump sum payment made to the worker in September 1995, which had been calculated at 15% of 104 x $634.70, should have been 208 x average weekly payments at the time payment was made, having regard to the amendments effected by the Work Health Amendment Act (No 2) of 1991, effective as from 15 October 1991. The amending legislation had the effect of doubling the multiplier of average weekly earnings from 104 x average weekly earnings to 208 times average weekly earnings.
78. Mr McDonald submitted that if the Court ultimately accepted that primary submission, “then the calculation to correct the shortfall will be 15% of 208 x $1,033.80 (being average weekly earnings in 2007 when the payment will be made) less the $9,901.32 originally made”.
79. Counsel relied upon the judgment of Mildren J in Pengilly v Northern Territory of Australia [2003] NTSC 19 at paragraph 13 as well as the judgment of the Court of Appeal in Northern Territory of Australia v Pengilly [2004] NTCA 4 at paragraphs 10 and 11 as authority for the Court calculating the shortfall in respect of the September 1995 permanent impairment assessment.
80. The facts in that case were that the appellant worker sustained an injury to her right arm in the course of her employment. Following surgery in relation to the injury, she contracted dermatitis. Liability for compensation under the Act for the injury and the dermatitis was accepted by the employer.
81. The appellant sought compensation for permanent impairment. The parties agreed that the appellant would be entitled to a payment pursuant to s 71 of the Act. The agreed amount was $60, 685.04, which represented 43% of the assessed percentage of 208 times average weekly earnings calculated at the time of payment. The figure of 43% was arrived at as follows. The appellant’s impairment of the whole person resulting from the dermatitis was agreed to be 24%, while her impairment of the whole person resulting from her carpal tunnel syndrome was agreed to be 25%. This combination of impairments translated into a permanent impairment equal to 43% of the whole person.
82. Following payment of the lump sum for permanent impairment, the appellant sought to reopen the claim. The request was denied and the issues between the parties were determined by the Work Health Court. The Court rejected the appellant’s claim on the merits. An appeal to the Supreme Court was dismissed. However, the Work Health Court held the making of an agreement in respect of permanent impairment did not prevent further application being made for payments if the permanent impairment, as assessed under the prescribed guides, is significantly increased or a new impairment arises.
83. Subsequently, the appellant’s dermatitis deteriorated whilst her carpal tunnel syndrome resolved. With respect to her dermatological condition, a medical panel certified that the appellant had a 60% permanent impairment of the whole person. A dispute then arose as to how the appellant’s entitlement was to be calculated.
84. When the matter came before the Work Health Court the presiding magistrate held that the appellant was entitled to 60%- 43% = 17% of the relevant average weekly earnings at the time of payment. The appellant appealed the Court’s decision. There being no issue about whether or not a second claim could be made, the sole issue related to the calculation of the claim.
85. The appellant’s primary submission was that she was entitled to be paid 60% of the relevant average weekly earnings – that is the sum of $102,036. The alternative submission was that she was entitled to $41,351.44, calculated by applying the following formula: $102, 036.00 ( ie $170,060 x 60%) - $60,684.56.
86. The respondent submitted that the calculation performed by the Court was correct – 17% of $170,060( ie 208 x` current average weekly earnings), which equalled $28,910.
87. Mildren J, who heard the appeal, stated;
I think it is clear that the appellant cannot recover $102,036.00 without in some way accounting for the fact that she has already been compensated. Any payment made in the past by the respondent to the appellant must amount to a pro tanto discharge of the respondent’s liability, unless there is a presumption of advancement operating to negate that conclusion, or there is evidence of a gift or other consideration given. Otherwise, the respondent would be entitled to recover from the appellant the amount already paid, on the basis of a total failure of consideration. There is no presumption of advancement and no evidence of a gift or other consideration given. The amount was paid in respect of her entitlement under s 71 of the Act and, therefore, must be brought into account. I therefore reject the first of the appellant’s submissions.
88. His Honour then went on to consider the two alternative arguments advanced by the appellant: the first being that only the assessed loss for the dermatological condition should be considered and the second being that she is entitled to $41,351.44.
89. In approaching the matter from first principles, Mildren J considered that the appellant’s argument that, whilst the worker’s increased loss for the dermatitis must be compensated for, the recovery of the carpal tunnel syndrome cannot be brought into account, overlooked the plain language of s 71(1) of the Act:
Whatever may have been the components of her loss in1997, the percentage permanent impairment of the whole person was 43% - it is now 60%; the plain language of s 71(1) entitles her to $170,000 x 60%, less whatever sums she must bring into account by way of prepayment.
90. His Honour went on to say:
At common law, the quantum of loss is calculated by a reference to the value of the loss at the time of the loss, and courts now have a statutory power to award interest to the time of payment to compensate the plaintiff for loss of the use of the money. ..Because s71 requires the assessment to be made by reference to the time of payment, the respondent submits that any loss caused by delay in finalising the payment, or the loss of use of the money, is compensated for. This is one explanation for the requirement in s 71 that the loss is to be calculated at the time of payment. If this is a correct explanation, as the respondent contends, an intention on the part of the legislature not to compensate the appellant twice for her loss should be inferred, and, in order to achieve that intention, s71 should be read so as to entitle her to now receive the difference between the percentage losses.
However, it is not always the case that a loss has stabilised to such a degree that a percentage of permanent loss of the whole person can be calculated immediately. The loss may be very severe initially, but recover gradually until it becomes sufficiently stable for an assessment to be made. Or, the impairment may worsen, as happened in the case of the appellant’s dermatitis. The concept of “permanent impairment” under the prescribed guides is one “considered unlikely to change substantially by more than 3% in the next year with or without medical treatment. But the words “unlikely to change”, whatever be their precise meaning, recognise that change is still a possibility – as happened in this case. In the case of a condition which has stabilised immediately, any delay in payment may be seen as compensation for the loss of the use of the money, but the same does not apply to conditions which have gradually got worse or gradually got better.
In the case of a gradually worsening condition, if there is only one payment and the payment is calculated at the date of payment, there is a over-compensation inherent in the calculation if the explanation is that the date of payment was chosen to compensate for loss of the use of the money. The opposite consideration is open when the condition gradually gets better.
Furthermore, where there is unreasonable delay in the acceptance of a claim or, or the payment of, compensation, the Court may award interest under s 109 of the Act. In the case of a claim or payment under s 71, the Court would have power to award interest calculated from the date that the claim ought to have been accepted, or the payment made. In addition, a worker who has an entitlement to compensation under s 71 which has not been paid, may, under s 97(2A), apply to the Registrar for a certificate of the amount payable under s71. If that certificate is filed in the Local Court, the Clerk of the Local Court shall enter judgment for the amount of compensation owing. Local Court judgments also bear interest until payment is made. These provisions tend to suggest that “the date of payment” in s 71 does not literally mean the actual date of payment, but the day payment is agreed to be made, or ought to have been made. The fact that interest can be awarded on top of the payment due under s 71 is a strong indicator that the date of payment method of calculation was not intended to compensate for the loss of the use of the money.
These factors tend to suggest that the date of payment method of calculation was chosen for the practical reason that, until there is sufficient stabilisation in the injury, the amount of compensation cannot be accurately calculated. There is, therefore, no sufficient reason to depart from the ordinary language of s71(1) and arrive at the amount of the present loss by reference to the difference between the loss of impairments at the relevant times, as the respondent’s contention would require. In addition, this being remedial legislation, a construction giving the worker the most complete remedy consistent with the language employed, and to which the words are fairly open, must be given to s 71: see Woodruffe v The Northern Territory of Australia (2000) 10 NTLR 52 at [ 28].
91. The employer appealed the decision of Mildren J. In dismissing the appeal, the Full Court (constituted by Martin(BR) CJ, Angel and Bailey JJ) found and held as follows:
As the Act does not specifically address the present situation where a second claim is made following a previous payout in respect of earlier permanent impairment arising from the same injury, the answer as to how the previous payment is to be taken into account must be found as a matter of statutory construction and general principle. It is not simply a question of “construing the Act beneficially towards the worker” nor of “general equitable principles of fairness’…
In our opinion, it is a mistake to approach the issue from the point of view that the appellant has discharged 43% of its current liability. Pursuant to s 71 the employee is entitled to compensation for a 60% permanent impairment assessed in today’s terms (“at the time the payment is made”). By way of contrast, the employer discharged a liability in respect of 43% permanent impairment that existed in 1997. The employee’s present claim is a new claim for 60% permanent impairment that exists today. It is not a claim under s 71 for an additional percentage for the increased incapacity over and above the 43% incapacity that existed in 1997. The concession that the respondent in 2001 can sue for compensation on the basis of 60% permanent impairment carried with it the concession that the appellant did not finally discharge its liability in respect of 43% of the respondent’s current permanent impairment by its payment in 1997. Counsel for the appellant expressly disavowed any res judicata with respect to the 43% impairment.
Viewed in this way, the employee is entitled to compensation based upon the 60% permanent impairment and, because the impairment arises out of the same injury which resulted in a 43% in 1997 and for which the employer compensated the employee, the employer is entitled to set off the amount paid in 1997 in pro tanto discharge of its later liability.
92. Mr McDonald submitted that the July 2002 lump sum payment, which had also been calculated at 104 x the then average weekly earnings, was in error for the following reasons:
The assessment on this occasion was a 30% permanent impairment. The employer deducted the 15% from the 1995 assessment and calculated the worker’s 2002 entitlement to be the remaining 15 % of the relevant calculation. However, this was the wrong approach. The correct approach was determined by the Court of Appeal Northern Territory of Australia v Pengilly (supra) which is to take the entire 30% of the relevant multiplier (either 104 or 208 x) of average weekly earnings in the year in which payment is made then deduct any previous permanent impairment made in respect of the same injury.
The employer has conceded that it did make an error of this type (see paragraph 38 of the Amended Defence) and purported to correct the underpayment by making a further payment on 29 March 2006, after the commencement of these proceedings. However, the employer once again miscalculated this shortfall. It paid the worker the amount of the shortfall in 2002, plus an amount by way of interest. The correct approach in 2006 should have been to take 30% of the relevant multiplier x average weekly earnings in 2006 and then deduct the payment made in 2002 for the 2002 assessment of permanent impairment. Because this was not done we now need to calculate the worker’s correct entitlement in 2007 rather than 2006 because of the wording of subsection 71(2) of the Act as interpreted by both Mildren J and the Court of Appeal in Pengilley.
262. Notwithstanding that the worker did not receive the entirety of his due entitlement in 2002, he has been paid, ex post facto, in conformity with the method of calculation prescribed by the Court of Appeal in Pengilly.
263. The worker has not been financially disadvantaged by the delayed payment of a sum of money that equates to approximately 18% of the amount that he should have been paid in 2002 according to the Pengilly formula. By reason of the additional payment of $2853.24 together with interest thereon, the worker was put in the same position as if he had received the sum of S15,607.30 in July 2002, being the date of payment for the purposes of s 71 of the Act.
264. In my opinion, the Court would be acting contrary to principle and notions of fairness and equity, if it were to accept the worker’s argument and recalculate the worker’s entitlement according to current average weekly earnings, or, in the alternative, according to 2006 average weekly earnings. If the Court were to recalculate the entitlement in either manner, that would result in the worker receiving a significant windfall and the employer suffering a significant detriment or penalty. I do not believe that the legislature intended s 71 to operate in such a fashion.
265. I have assumed that the calculation of interest is correct. If the amount of interest requires amendment, then I give the parties liberty to apply.
• The worker’s third claim: the cost of the further permanent assessments
266. This claim has resolved, as the employer paid these costs on 15 December 2006. If there is any outstanding claim for interest, I also give the parties liberty to apply in relation to that issue.
• The worker’s fourth claim: a further permanent impairment payment
267. In my opinion, the worker has no entitlement under this claim for the reasons that follow.
268. The worker’s claim in the sum of $64,833.60 in relation to the assessed 30% permanent impairment is predicated on the total knee replacement and its consequences not only constituting an “injury”, occurring after 15 October 1991, but also being a separate and different injury to the original injury. For the reasons given earlier, the surgery performed on the worker does not fall within the definition of “injury” under the Work Health Act. The total knee replacement and its consequences is to be attributed to the original injury. For those reasons this primary claim must fail.
269. The worker’s alternative claim in the same amount less the permanent impairment payments made in 1995 and 2002 must fail for similar reasons.
270. The worker’s claim in the amount of $25, 933.44, being the previously unassessed and uncompensated assessment for chronic pain (7%) and scarring (5%) must also fail because, as in the case of the primary claim, the claimed permanent impairments were not caused by an “injury” within the meaning of the Act, and most definitely not caused by a separate and different injury occurring after 15 October 1991.
271. For those reasons I decline to make the rulings sought by the worker in paragraphs 67.3 and 67.4 of the Statement of Claim.
• Further remedies
272. To the extent that the above determinations do not fully answer the five scenarios presented by the worker in support of his claim for further payments pursuant to s 71(1) of the Work Health Act, I find that the worker is not entitled to any further payment pursuant to the Act on the basis of any of those postulated scenarios or indeed any other scenario.
273. For the sake of completeness, I refuse to make the orders sought in paragraphs 67.5 and 67.6 of the Statement of Claim.
SECONDARY ISSUES
274. A number of issues were raised and ventilated in these proceedings, which although not crucial to the determination of the worker’s application, warrant attention.
• The scheme of compensation for permanent impairment under the Work Health Act
275. The worker’s argument was that the permanent impairment provisions of the Work Health Act were analogous to the permanent impairment regime of the Safety, Rehabilitation and Compensation Act 1988 (Cth), which was judicially considered in Canute v Comcare (2006) 229 ALR 445. It was argued that like the Commonwealth statute the permanent impairment provisions of the Northern Territory Act only adopted a “whole person impairment” approach with respect to permanent impairments resulting from each injury that a worker may suffer.
276. The employer mounted an argument that the relevant provisions of the Work Health Act did not embrace such an approach. Rather, the scheme of the Act is to compensate workers for permanent impairment resulting from an injury or any number of injuries on a “whole person impairment” basis. In other words, where a worker suffers a number of injuries it is not the scheme of the Act to separately compensate the worker for permanent impairment arising from each injury on a “whole person impairment” basis – the scheme is to compensate the worker on a “whole person impairment” basis referable to the injuries as a whole.
277. In order to determine whether the permanent impairment provisions of the Work Health Act mirror the permanent impairment regime of the Safety, Rehabilitation and Compensation Act it is necessary to examine both pieces of legislation very closely.
278. Although there are some similarities between the two pieces of legislation there are core differences between them which favour the employer’s construction of the relevant provisions of the Work Health Act.
279. Section 14(1) of the Commonwealth Act provides as follows:
Subject to this Part, Comcare is liable to pay compensation in accordance with this Act in respect of an injury suffered by an employee if the injury results in death, incapacity for work, or impairment.
280. Section 24(1) of the Act provides that where an injury to an employee results in a permanent impairment, Comcare is liable to pay compensation in respect of the injury. As noted by the High Court in Canute v Comcare (supra), that provision makes the occurrence of “an injury” central to “the scheme upon which Comcare’s liability to compensate depends”. As also noted by the High Court, s 24(1) “does not oblige Comcare to pay compensation in respect of an employee’s impairment; it is liable to pay compensation in respect of ‘the injury”.
281. Section 24(5) of the Act provides that Comcare shall determine the degree of permanent impairment of the employee resulting from an injury under the provisions of the approved Guide. Again as noted by the High Court, s 24(5) is a central provision requiring Comcare to determine the degree of an employee’s permanent impairment. Pursuant to subsection (6), the degree of permanent impairment is to be expressed as a percentage. The content of the phrase “the degree of permanent impairment” is not specifically stated in the Act, but is left to the approved Guide.
282. As observed by the High Court, the definition of “impairment” in s 4(1) of the Act is not expressed in terms of assessing impairment on a “whole person” basis. The definition is as follows:
“Impairment” means the loss, the loss of the use, or the damage or malfunction, of any part of the body or of any bodily system or function or part of such system or function.
283. “Permanent” is defined as meaning “likely to continue indefinitely”.
284. The High Court went on to observe:
The definition of “impairment” (and, by extension, the concept of “permanent impairment”) is expressed in terms of effects on bodily parts, systems and functions. This disaggregated sense of the word is reinforced by the use of the indefinite expression “a permanent impairment” in s 24(1). Textually, the Act assumes that “an injury” may result in more than one “impairment”.
285. The High Court explained the interaction between an employee’s degree of permanent impairment and the Guide as follows:
Content is given to the expression “degree of permanent impairment of the employee” by reference to the “Guide to the Assessment of the Degree of Permanent Impairment” (the Guide), to which s 24(5) refers. The guide is subordinate legislation which is to be prepared by Comcare and approved by the Minister pursuant to s 28 of the Act.
286. As noted by the High Court, Part A of the guide is concerned with permanent impairment, while Part B is concerned with non-economic loss. Part A gives effect to the definition of “impairment” in s 4(1) of the Act by “a structure which compiles descriptions of impairments into groups according to body system and by expressing each impairment as a percentage value of the functional capacity of a normal healthy person”. The High Court then pointed out that the Guide contains a “Combined Values Chart”, which enables “each impairment expressed as a percentage to be combined to give the total effect of all impairments…as a percentage value of the employee’s whole bodily system or function”. Although the Guide claims to import the “whole person impairment” from the American Medical Association Guides, the High Court stressed the following:
…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”. The terms of s 24(4) are quite clear: Comcare is to assess the degree of permanent impairment of the employee “resulting from an injury”. Similarly, in s 24(7), the threshold permanent impairment of the employee of 10% affects the amount of compensation payable “under this section”; that is, “in respect of the injury”; s 24(1).
The scheme of the Act proceeds in this way from the occurrence of “an injury”, in the defined sense, As previously remarked, the Act assumes that more than one “injury” may occur. Therefore it is not correct to say that s 24(5) imports a “whole person” approach to the determination of the degree of permanent impairment. That ignores the centrality of “an injury” to the scheme upon which Comcare’s liability to compensate depends.
287. It is also important to note that the Commonwealth Act makes specific provision for subsequent increase in the degree of impairment: see s 25(4) and
(5). Section 25(4) assumed prominence in Canute v Comcare (supra). The High Court’s construction of the permanent impairment provisions of the Safety Rehabilitation and Compensation Act was discussed earlier.
288. Section 24(5) combined with s 25(4) enables workers to either make a claim for further permanent impairment compensation where there is an increase in the level of impairment resulting from an injury previously compensated for or to make a fresh claim for permanent impairment arising out of an injury that is different to an injury resulting in permanent impairment which has been previously compensated for.
289. Turning to the Work Health Act (NT), s 53 (1), as at the date these proceedings were commenced, provided as follows:
Subject to this Part, where a worker suffers an injury within or outside the Territory and that injury results in or materially contributes to his or her –
(a) death;
(b) impairment or
(c) incapacity,
there is payable by his or her employer to the worker or the worker’s dependants, in accordance with this Part, such compensation as is prescribed.
290. The first observation I make is that s 53(1), although similar to s 24(1) of the Safety, Rehabilitation and Compensation Act 1988 (Cth), is subtly different from its Commonwealth counterpart. The Commonwealth provision makes it quite clear that compensation is payable in respect of an injury, provided that the injury has resulted in death, incapacity for work or impairment. The Northern Territory provision makes compensation payable in respect of an injury that results in or materially contributes to a worker’s death, impairment or incapacity. To my mind, s 53(1) of the Work Health Act does not emphasise the centrality of an injury to the scheme for compensating permanent impairment in the same way as s 14(1) of the Commonwealth Act does with respect to its scheme for compensation of permanent impairment. The Northern Territory provision does not place the same emphasis on the primacy of an injury as a basis for the payment of compensation in the way that Commonwealth provision does. Unlike s 14(1) of the Safety Rehabilitation and Compensation Act, s 53(1) of the Work Health Act makes the payment of compensation under the Act dependent upon the confluence of an injury and death, impairment or incapacity. In coming to that view, I have been influenced by the conjunctive language and structure of s 53(1) of the Work Health Act compared with the disjunctive language and structure of s 14(1) of the Safety, Rehabilitation and Compensation Act.
291. This construction of s 53(1) is consistent with the Act adopting a “whole person” approach to compensation for permanent impairment in the way argued by the employer.
292. The next critical distinction between the two statutes is that unlike the definition of impairment in s 4(1) of the Commonwealth Act, the definition of “permanent impairment” in s 70 of the Work Health Act embraces a “whole person” approach.
293. Similarly, unlike s 24 of the Commonwealth Act, s 71(1), (2) and (3) of the Work Health Act – the mechanical provisions in relation to compensation for permanent impairment – expressly adopt a “whole person” approach.
294. There is nothing in subdivision C of Part V of the Work Health Act (ss 70, 71 and 72) which requires, or even suggests, that the assessment of permanent impairment be undertaken by assessing the degree of permanent impairment of a worker resulting from an injury - the process required pursuant to s 24(5) of the Safety, Rehabilitation and Compensation Act; nor is there anything requiring or suggesting that compensation be calculated and paid according to that method of assessment.
295. Unlike the Commonwealth Act, the Work Health Act does not provide a specific statutory mechanism enabling a worker to make a further claim for permanent impairment compensation in the event of an increase in the level of an impairment which has been previously compensated. There is no equivalent to s 25(4) of the Safety Rehabilitation and Compensation Act. Nor is there an equivalent provision to s 24(5) of that Act, which empowers a worker to make a number of claims for permanent impairment arising out of different injuries. The absence of similar provisions in the Work Health Act is significant, because it was the existence of those provisions in the Commonwealth Act that appears to have led the High Court to conclude that the whole person approach only applied to individual injuries, and not to a series of different injuries.
296. It is accepted that the present state of the law in the Northern Territory seems to permit a worker to return to the Work Health Court for a further payment of compensation pursuant to s 71(1) of the Act, where there has been an increase in the level of impairment resulting from an injury in respect of which permanent impairment compensation has previously been paid. The existing law also appears to permit a worker to make a fresh claim in relation to permanent impairment arising from an injury which is different to a previous injury causing permanent impairment, and which has been the subject of a previous compensation payment. However, the existing authorities are silent as to how the Court should deal with a claim in the latter category. Should the Court adopt the approach that the High Court took in relation to the appellant’s claim for a psychiatric condition under the provisions of the Commonwealth legislation in Canute v Comcare (supra)?
297. It is clear from Pengilly that in a case where a worker makes a claim for a further permanent impairment compensation payment pursuant to s 71(1) of
the Work Health Act, consequent upon an increase in the level of impairment arising out of an injury, that the whole person impairment philosophy is implicitly applied in calculating the worker’s entitlement. There is no warrant – either statutory or otherwise – for adopting a different approach when dealing with a “new” or “fresh” claim in relation to a different injury following the payment of compensation with respect to permanent impairment arising out of an earlier injury.
298. I agree with and adopt the employer’s submissions in relation to its construction of the scheme of the Act.
299. Read as a whole the permanent impairment provisions of the Work Health Act do not adopt a “whole person impairment” approach only with respect to permanent impairments resulting from each injury, where a worker suffers from multiple injuries – they do not permit a separate assessment in respect of each injury, as argued by the worker in this case. The Work Health Act prescribes a general whole person impairment approach, which requires an assessment of the whole person in terms of permanent impairment, regardless of how many injuries a worker may suffer.
300. This approach has certain ramifications in relation to the worker’s claim for permanent impairment compensation. Even if the Court had accepted that the total knee replacement undertaken by the worker in 2004 constituted a fresh “injury” for the purposes of the Act, then he would not have been entitled to any further payment of permanent impairment compensation because, according to the evidence, his level of permanent impairment appears to have remained at the same level that it was in 2002 at the time of the previous payment, namely 30%. The scheme of the Act would not sanction a further payment assessed at 30% whole person impairment over and above the previous payment based on the 30% assessment made in 2002. In other words, the permanent impairment provisions of the Act would not entitle the worker to a total payment calculated on the basis of a 60% whole person permanent impairment.
• The hiving off of permanent impairment assessments
301. In his Statement of Claim, the worker sought a ruling that each of the assessments made by Dr Mills in his report dated 18 December 2005 of 7% permanent impairment of the whole person for pain and 5% of the whole person for scarring and cosmetic defects in respect of the worker arising from the injury, are assessments in respect of permanent impairment aspects of the worker from the injury which had not previously been assessed or compensated for in 1995 and /or 2002.
302. Given that the Work Health Act adopts a whole person permanent impairment approach to the calculation of permanent impairment compensation claims and incorporates the American Association Guides to the Evaluation of Permanent Impairment, the Court is unable to make the ruling sought by the worker. I agree with and adopt the submissions made by Mr Grant, which are to the effect that it is not possible to “hive off” the assessments made in respect of pain and scarring.
303. Although the Guides permit a separate allowance for chronic pain, or chronic pain syndrome, the evidence in the present case was insufficient to support the payment of such an allowance as representing a separate permanent impairment assessment. The insufficiency of the evidence is dealt with in the next section of these reasons for decision.
304. Neither the Act nor the Guides allow scarring to be hived off as a separate permanent impairment assessment and to be made the subject of a separate permanent impairment compensation payment pursuant to s 71(1) of the Act, or as part of a global payment, pursuant to that section, for pain and scarring.
305. The other difficulty with this aspect of the matter is that the worker’s claim is predicated on the 7% permanent impairment for pain and the 5% permanent impairment for scarring and cosmetic defects not having been previously assessed and compensated for in 1995 and/or 2002. As submitted on behalf of the employer, “the worker has previously been compensated expressly for scarring and impliedly for pain, and there is no evidence to support a claim for some deterioration in his condition in relation to chronic pain and scarring since the assessment in 2002”. Simply put, the worker has failed to discharge the relevant burden of proof.
306. Therefore, even if the total knee replacement and its consequences – in terms of pain and scarring – could properly be considered to be “an injury” within the meaning of the Act, the worker would not be entitled to a further sum or sums for his current percentage permanent impairment of the whole person as assessed by Dr Mills in his report dated 18 December 2005, particularly in relation to pain and scarring.
• The evidentiary difficulties in relation to the worker’s claims
307. In relation to the medical evidence presented in this case, the solicitors for the employer, by way of email dated 4 April 2007 (Exhibit 2), gave notice to the worker’s solicitors in the following terms:
We confirm that we do not require your medical experts for cross-examination, subject to the following qualifications:
1. in not requiring the medical experts for cross-examination, we do not concede that any particular opinion expressed in those reports is properly accepted by the Court for the purposes of the proceeding; and
2. we reserve the right to make submissions to the effect that the reports do not disclose an entitlement to any further payment for permanent impairment having regard to their content, the relevant legislative provisions and the prescribed guides.
308. The terms of that prior notice were echoed in Mr Grant’s submissions.
309. As referred to earlier, Mr Grant sought to impugn the accuracy and reliability of Dr Mills’ report by highlighting its evidentiary deficiencies, arising primarily out of its failure to apply and follow the prescribed Guides.
310. As pointed out by Mr Grant, “it is permissible for the Court to analyse assessment reports for the purpose of determining whether they have been
compiled in accordance with the prescribed Guides, and whether they support the claim for a further payment for permanent impairment: see Pengilly v Northern Territory of Australia [1999] NTSC 131”.
311. Apart from the issue of the application of the Guides, expert witnesses are expected to refer to and state the assumptions of fact and evidence upon which they have based their opinions and from which they seek to draw particular inferences, so as to enable a court to evaluate the accuracy or reliability of the expert testimony. As stated by Ligertwood 4th Edition of Australian Evidence [7.68], p 505:
The facts which form the basis of expert opinion must be capable of proof by admissible evidence. If no evidence is tendered, the whole foundation of the expert testimony may disappear, so rendering that testimony irrelevant: see R v Haidley and Alford [1984] VR 229 at 250-251; Paric v John Holland Constructions Pty Ltd (1985) 62 ALR 85.
312. The following commentary appears in Cross on Evidence 6th Australian edition, [29065], p 821:
The facts upon which an expert’s opinion is based must be available for scrutiny by the tribunal. A court can hardly be expected to act upon an opinion the basis for which is not explained by the witness expressing it. This means that the factual basis of the opinion must be identified and proved.
313. The effect of Regulation 9(1) of the Work Health Regulations, read together with s 187(2) of the Work Health Act, is to incorporate into the regulations the whole of the text of the 4th edition of the American Medical Association Guides to the Evaluation of Permanent Impairment.
314. Those Guides not only prescribe the processes of assessment, but, properly applied, provide the primary or intermediate facts upon which a medical assessment of permanent impairment is based. They also demonstrate the chain of reasoning which produced the conclusion arrived at by the medical practitioner. The Guides also provide a standard by which the reliability of an expert’s opinion can be evaluated by the Court.
315. The fact that, pursuant to Rule 18.06(2) of the Work Health Court Rules, the medical report of Dr Mills was admissible as evidence of the doctor’s opinion, the fact that no other medical evidence was presented with a view to contradicting Dr Mills’ opinion, combined with the fact that the employer did not require the doctor to attend for cross-examination, does not mean that the Court is bound to accept the doctor’s opinion. There must be a proper basis for the opinion before the Court can act upon that opinion as a reliable assessment of permanent impairment.
316. A fundamental difficulty with the report of Dr Mills is that it does not establish a causal nexus between the postulated injury – ie the total knee replacement – and the assessed level of permanent impairment. As submitted by Mr Grant, the impairment in question must be caused by an injury arising out of or in the course of employment; and compensation for permanent impairment is payable only if the injury results in or materially contributes to the impairment.
317. No where in his report does Dr Mills express an opinion as to there being a causal relationship between the total knee replacement and the 30% permanent impairment assessment (either as a whole or broken down into its components) that he made in relation to the worker. In my opinion, one cannot draw an intuitive inference or presumptive (prima facie) inference from the fact that the total knee replacement caused and resulted in or materially contributed to the worker’s impairment as assessed. The sequence of events “would not inspire in the mind of any common sense person” – to use the words of Rich J in Adelaide Stevedoring Co Ltd v Forst (1940) 64 CLR 538 at 563-4) – that the surgery caused and resulted in or materially contributed to the assessed impairment.
318. If any intuitive inference is to be drawn from the subsequent surgeries performed on the worker it is that the surgery produced positive results. Indeed, the tenor of the various reports is along those lines.
319. For the sake of completeness, I agree with Mr Grant’s general submission that there is no evidence that the impairment claimed was caused by the subsequent surgeries (including the total knee replacement) performed on the worker.
320. On top of the fundamental difficulty with Dr Mills’ report, there is, in my opinion, insufficient material in Dr Mills’ report to show that the process of assessment adopted by him was in accordance with the Guides. In a number of respects the Guides were not followed by Dr Mills. They are generally as outlined by Mr Grant. A bare statement that Dr Mills used the Guides in calculating the percentage of permanent impairment, or that one could infer from the doctor’s experience that he applied the guidelines in arriving at his final assessment, is not sufficient to establish that the doctor, in fact, followed the various prescribed antecedent processes before arriving at his final conclusion in relation to the worker’s whole person permanent impairment. By way of example, in Pengilly the medical practitioner’s compliance with the Guides was questioned and found to be wanting.
321. The real point is that Dr Mills’ report does not overtly demonstrate compliance with the Guides as set out earlier in these reasons for decision. As a result the doctor’s chain of reasoning is also not overtly demonstrated. In turn, this means that the primary or intermediate facts upon which the doctor’s final assessment was made are not disclosed in the report. The basis for the doctor’s opinion has not been established to the satisfaction of the Court. Accordingly, Dr Mills’ opinion has little probative value. The doctor’s assessment cannot be accepted as being reliable.
322. There is the added problem that the Court cannot be satisfied, on the evidence, that the total knee replacement gave rise to an impairment greater than the threshold requirement of 5% of the whole person. This problem also presents in relation to the earlier surgical procedures.
323. Therefore, even if the Court had been persuaded that each of the surgical procedures (including the 2002 total knee replacement) constituted a fresh injury within the meaning of the Act, and that those injuries caused and resulted in or materially contributed to a permanent impairment, the Court would not have been able to be reasonably satisfied as to the reliability of the permanent impairment assessment made by Dr Mills and that the level of impairment exceeded the 5% threshold.
DECISION
324. The worker’s claim is dismissed.
325. The parties have liberty to apply in relation to any issue concerning the calculation of interest with respect to the worker’s second claim and third claim.
326. I will hear the parties in relation to the question of costs.
Dated this 29th day of June 2007.
_________________________
Dr John Lowndes
STIPENDIARY MAGISTRATE
ATTACHMENT A
WORKER’S SCENARIO 1
If the Worker’s permanent impairment entitlements are to be calculated at 104 x average weekly earnings rather than 208 x average weekly earnings, with the previous lump sums paid in 1995 and 2002 being set off.
(a) 1995 15% Assessment
Received $9,901.32 – nothing more claimed.
(b) 2002 30% Assessment
Received $12,754.56 but should have received $15,607.30 being 30% of [104 x $817.60 (average weekly earnings in 2002)] less $9,901.32. Shortfall therefore was $2,853.24.
The Employer purported to correct this shortfall on 29 March, 2006 by paying $2,853.24 plus $1,049.99 interest, a total of $3,903.23.
This is the wrong approach and resulted in an underpayment in 2006. The correct approach in 2006 should have been 30% of [104 x $1,039.00 (average weekly earnings in 2006)] less $9,901.32 less $12,754.56 = $32,416.80 - $22,655.83 = $9,760.92.
As we are correcting this insufficient payment in 2007, the correct figure is 30% of [104 x $1,033.80 (average weekly earnings in 2007)] less $9,901.32 less $12,754.56 less $3,903.23 = $32,254.56 - $26,559.11 = $5,695.45.
(c) 2005 Assessment – Dr Mills’ 30%
30% of [104 x $1,033.80 (average weekly earnings in 2007)] less $9,901.32 less $12,754.56 less $3,903.23 less the amount claimed of $5,695.45 = $NIL.
TOTAL CLAIMED UNDER THIS SCENARIO - $5,695.45
WORKER’S SCENARIO 2
If the Worker’s permanent impairment entitlements are to be calculated at 104 x average weekly earnings rather than 208 x average weekly earnings, with the previous lump sums paid in 1995 and 2002 NOT being set off.
(a) 1995 15% Assessment
Nil claim
(b) 2002 30% Assessment
Should have received 30% of [104 x $817.60 (AWE in 2002)] = $25,509.12. In fact, received $12,754.56 in 2002 and a further $3,903.23 in 2006.
As payment of the shortfall is to be received in 2007, the calculation is 30% of [104 x $1,033.80 (average weekly earnings in 2007)] less $12,754.56 less $3,903.23 = $32,254.56 - $16,657.79 = $15,596.77.
(c) 2005 Assessment – Dr Mills’ 30%
30% of [104 x $1,033.80 (average weekly earnings in 2007)] = $32,254.56.
TOTAL CLAIMED UNDER THIS SCENARIO - $47,851.33
WORKER’S SCENARIO 3
If the Worker’s permanent impairment entitlements are to be calculated at 208 x average weekly earnings rather than 104 x average weekly earnings, with the previous lump sums paid in 1995 and 2002 being set off.
(a) 1995 15% Assessment
Was paid $9,901.32.
Should have been paid double this at 208 x average weekly earnings.
As payment is to be received in 2007, the calculation is 15% of [208 x $1,033.80 (average weekly earnings in 2007)] less $9,901.32 = $32,254.56 - $9,901.32 = $22,353.24.
(b) 2002 30% Assessment
Was paid $12,754.56 in 2002 and a further $3,903.23 in 2006.
Should have been paid much more on the basis of 208 x average weekly earnings.
As payment is to be received in 2007, the calculation is 30% of [208 x $1,033.80 (average weekly earnings in 2007)] less $9,901.32 less $12,754.56 less $3,903.23 less $22,353.24 = $64,509.12 - $48,912.35 = $15,596.77.
(c) 2005 Assessment – Dr Mills’ 30%
As per Scenario 1 - $NIL.
TOTAL CLAIMED UNDER THIS SCENARIO - $37,950.01
WORKER’S SCENARIO 4
If the Worker’s permanent impairment entitlements are to be calculated at 208 x average weekly earnings rather than 104 x average weekly earnings, with the previous lump sums paid in 1995 and 2002 NOT being set off.
(a) 1995 15% Assessment
As per scenario 3 - $22,353.24.
(b) 2002 30% Assessment
Was underpaid on basis of 104 times rather than 208 times.
As payment of the shortfall is to be received in 2007, the calculation is 30% of [208 x $1,033.80 (average weekly earnings in 2007)] less payments received of $12,754.56 and $3,903.23 = $64,509.12 - $16,657.79 = $47,851.33.
(c) 2005 Assessment – Dr Mills’ 30%
As payment is to be received in 2007, calculation is 30% of [208 x $1,033.80 (average weekly earnings in 2007)] = $64,509.12.
TOTAL CLAIMED UNDER THIS SCENARIO - $134,713.69
WORKER’S SCENARIO 5
If the Worker’s permanent impairment entitlements assessed in 1995 and 2002 are to be calculated at 104 x average weekly earnings rather than 208 x average weekly earnings, with the lump sum paid in 1995 being set off from the lump sum payable in 2002 BUT if the Worker’s permanent impairment entitlement following the total left knee replacement in 2004 is to be calculated at 208 x average weekly earnings rather than 104 x average weekly earnings, with the lump sums paid for the two earlier assessments NOT being set off -
(a) 1995 15% Assessment
Received $9,901.32 – nothing more claimed.
(b) 2002 30% Assessment
Received $12,754.56 but should have received $15,607.30 being 30% of [104 x $817.60 (average weekly earnings in 2002)] less $9,901.32. Shortfall therefore was $2,853.24.
The Employer purported to correct this shortfall on 29 March, 2006 by paying $2,853.24 plus $1,049.99 interest, a total of $3,903.23.
This is the wrong approach and resulted in an underpayment in 2006. The correct approach in 2006 should have been 30% of [104 x $1,039.00 (average weekly earnings in 2006)] less $9,901.32 less $12,754.56 = $32,416.80 - $22,655.83 = $9,760.92.
As we are correcting this insufficient payment in 2007, the correct figure is 30% of [104 x $1,033.80 (average weekly earnings in 2007)] less $9,901.32 less $12,754.56 less $3,903.23 = $32,254.56 - $26,559.11 = $5,695.45.
(c) 2005 Assessment – Dr Mills’ 30%
As payment is to be received in 2007, calculation is 30% of [208 x $1,033.80 (average weekly earnings in 2007)] = $64,509.12.
TOTAL CLAIMED UNDER THIS SCENARIO $70, 204.57.
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