Harbach v Noni B Holdings Pty Ltd

DETERMINATION OF APPEAL PANEL
CITATION:	Harbach v Noni B Holdings Pty Ltd [2024] NSWPICMP 803
APPELLANT:	Renee Harbach
RESPONDENT:	Noni B Holdings Pty Limited
APPEAL PANEL
MEMBER:	Carolyn Rimmer
MEDICAL ASSESSOR:	Tommasino Mastroianni
MEDICAL ASSESSOR:	John Brian Stephenson
DATE OF DECISION:	27 November 2024
CATCHWORDS:	WORKERS COMPENSATION - Workplace Injury Management and Workers Compensation Act 1998; Medical Assessor (MA) made a deduction of one half for pre-existing conditions in the right hip and right knee; MA failed to provide adequate reasons for the deduction in circumstances where the worker was asymptomatic before the work injury; Held – Medical Assessment Certificate revoked.

BACKGROUND TO THE APPLICATION TO APPEAL

On 24 September 2024 Renee Harbach (the appellant) lodged an Application to Appeal Against the Decision of a Medical Assessor. The medical dispute was assessed by Dr Robert Kuru (Medical Assessor), who issued Medical Assessment Certificate (MAC) on 4 September 2024.
The appellant relies on the following grounds of appeal under s 327(3) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act):
· the MAC contains a demonstrable error.
The delegate is satisfied that, on the face of the application, at least one ground of appeal has been made out in the MAC of the Medical Assessor. The Appeal Panel has conducted a review of the original medical assessment but limited to the ground(s) of appeal on which the appeal is made.
Rule 128 of the Personal Injury Commission Rules 2021 (the PIC Rules) and Procedural Direction PIC7 - Appeals, reviews, reconsiderations and correction of obvious errors in medical disputes set out the practice and procedure in relation to the medical appeal process under s 328 of the 1998 Act. An Appeal Panel determines its own procedures in accordance with r 128(1) of the PIC Rules.
The assessment of permanent impairment is conducted in accordance with the SIRA NSW Workers Compensation Guidelines for the Evaluation of Permanent Impairment, 4^th ed 1 March 2021 (the Guidelines) and the American Medical Association Guides to the Evaluation of Permanent Impairment, 5^th ed (AMA 5).

RELEVANT FACTUAL BACKGROUND

The appellant suffered an injury to her right hip and right knee back when she tripped on a piece of cabling and her right knee hit a cabinet.
The Appellant lodged an Application for Assessment by a Medical Assessor in the Personal Injury Commission (Commission) on 17 June 2024 for assessment as to whether the degree of permanent impairment is more that 20% (s 39, Workers Compensation Act 1987 (1987 Act)) and assessment as to whether the degree of permanent impairment is more that 30% (s 32A 1987 Act.)
On 17 July 2024 Member Seaton issued a Certificate of Determination - Consent Orders as follows;
“1. I remit this matter to the President for referral to a Medical Assessor pursuant to s 321 of the Workplace Injury Management and Workers Compensation Act 1998 for assessment as follows;
a. date of injury: 22 February 2019;
b. body systems/parts: right lower extremity (right hip and right knee); and
c. method of assessment: whole person impairment.
2. The documents to be reviewed by the Medical Assessor are:
a. the application for assessment by a Medical Assessor and attached documents; and
b. the respondent’s response and attached documents.”
The Medical Assessor examined the appellant on 29 August 2024 and assessed 20% whole person impairment (WPI) of the right lower extremity (knee) and then deducted one third for a pre-existing condition which resulted in an assessment of 13% WPI for the right lower extremity (knee). The Medical Assessor assessed 15% WPI of the right lower extremity (hip) and deducted one-half for pre-existing condition which resulted in an assessment of 8% WPI for the right lower extremity (hip). The total WPI, as a result of the injury on 22 February 2019, was 20%.

PRELIMINARY REVIEW

The Appeal Panel conducted a preliminary review of the original medical assessment in the absence of the parties and in accordance with the Procedural Direction PIC7.
The appellant submitted that re-examination is not required but she is prepared for re-examined by a Medical Assessor who is a member of the Appeal Panel if the Appeal Panel deems it necessary.
As a result of that preliminary review, the Appeal Panel determined that it was unnecessary for the appellant to undergo a further medical examination because there was sufficient information upon which to make a determination.

EVIDENCE

Documentary evidence

The Appeal Panel has before it all the documents that were sent to the Medical Assessor for the original medical assessment and has taken them into account in making this determination.

Medical Assessment Certificate

The parts of the medical certificate given by the Medical Assessor that are relevant to the appeal are set out, where relevant, in the body of this decision.

SUBMISSIONS

Both parties made written submissions. They are not repeated in full but have been considered by the Appeal Panel.
The appellant’s submissions include the following:
(a)    the MAC contains the following demonstrable error, in that the Medical Assessor made a deduction for a pre-existing condition pursuant to s 323 of the 1998 Act and did not provide any, or any sufficient reasoning for making that deduction.
(b)    The Medical Assessor incorrectly found that the appellant’s pre-existing injury, condition or abnormality amounted to a one third deduction in the right knee and one-half deduction in the right hip.
(c)    The process for determining impairment and any appropriate s 323 deduction was set out by Garling J in Pereira v Siemens Ltd [2015] NSWSC 1133. Cole v Wenaline Pty Ltd [2010] NSWSC 78 (Cole) provides authority for the notion that there should be no deduction pursuant to s 323 where there are no symptoms from a pre-existing condition before the work injury. It is however conceded that if a pre-existing condition is a contributing factor to the impairment suffered by the worker, a deduction may be made (see Vitaz v Wesfarmers (NSW) Pty Limited [2011] NSWCA 254).
(d)    In Ryder v Sundance Bakehouse [2015] NSWSC 526, Campbell J said:
“Section 323 as I have already said, requires there to be a deduction for any proportion of the impairment that is due to any pre-existing condition. This is an essential element of the section; indeed it is the pith of it. It is not enough to simply identify that there is a pre-existing condition and that there has been a subsequent impairment and therefore make a deduction under this section because of the existence of the pre-existing condition. Such reasoning fails to consider a necessary condition of the operation of the section; that a proportion of the permanent impairment is due to the pre-existing condition.”
(e)    Cole was discussed in Fire & Rescue NSW v Clinen [2013] NSWSC 629 where Campbell J said:
“As Schmidt J, pointed out in Cole and Elicheikh, it is necessary to find a preexisting abnormality or condition, here the latter, actually contributing to the impairment before s 323 of the WIM is engaged. This conclusion has to be supported by evidence to that effect. Assumption will not suffice.”
(f)    In State of New South Wales (Central Coast Local Health District) v Page [2023] NSWSC 935 Lonergan J referred to the decision of the second appeal panel and said at [29]:
“On 1 December 2022 the Second Appeal Panel confirmed the assessment of 21% WPI made by Dr Burns (Second Decision). The Panel took a different approach to Dr Burns on the issue of deduction under s 323 of the WIM Act, as is their right, and concluded that Dr Burns ought to have considered whether arthritis existed prior to the deemed date but continued to carry out their own assessment of impairment and analysis. They concluded, relevantly:
‘40. Having regard to the advanced nature of the arthritis demonstrated on scans in November 2018 and January 2019, the Panel is comfortably satisfied that there was arthritis in both thumbs prior to injury on 8 October 2018. It remains for the Panel to consider what, if any, deduction ought be made to take account of that pre-existing condition.
41. A deduction is only available in respect of such a condition if it currently contributes to the assessed impairment. To make that finding, the assessed impairment must be greater by reason of the pre-existing condition than it would otherwise have been. As Campbell J put in Ryder v Sundance Bakehouse [2015] NSWSC 526 at [45], ‘the Panel must be satisfied that but for the pre-existing abnormality, the degree of impairment resulting from the work injury would not have been as great’.
42. In this case, arthritic conditions of both thumbs were treated by trapeziectomy and suspension plasty at the hands of Dr Marchalleck on 28 August 2018 (left) and 25 July 2020 (right). …
43. With removal of the arthritic tissue, arthritis ceased to exist in the thumbs. Dr Burns’ examination disclosed no evidence of persisting arthritis. There is no basis for any finding that it exists, or that it continues to contribute to impairment…
45. In our view, it is not possible to find that the impairment is greater by reason of the pre-existing arthritis than it otherwise would have been, because there is no evidence that the surgery would have been necessary by the time of the assessment, but for the aggravation and exacerbation of arthritis on 8 October 2018, which rendered the underlying condition symptomatic. To put it in the terms used in Ryder, the Panel is not satisfied that, ‘but for the pre-existing abnormality, the degree of impairment resulting from the work injury would not have been as great’. As the test in Ryder is not satisfied, no deduction is available, and a further examination is unnecessary.’”
(g)    The appellant as noted by both Drs Bosanquet and Hopcroft, underwent both a right total knee replacement and a right total hip replacement, both procedures in which the effect is that all arthritic tissue is removed.
(h)    The Medical Assessor states in respect of a s 323 deduction:
“The injuries to both the knee and hip represent aggravation of a preexisting degenerative pathology. Without this pathology, Ms Harbach would not have undergone either her knee replacement or hip replacement.”
(i)    Other than identifying the pathology which was relied upon in the report of Dr Bosanquet, there is no evidence that the Medical Assessor took a history, or considered whether the appellant had any pre-existing symptoms or restrictions from the alleged pre-existing pathology at the time of the subject injury.
(j)    The Medical Assessor simply identified the alleged pre-existing pathology and applied a substantial deduction.
(k)    The Medical Assessor failed to provide any, or any sufficient reasons to support a deduction pursuant to s 323, or if such a deduction was warranted, to support a deduction departing from an application of s 323(2).
(l)    A new MAC should be issued and a revised s 323 deduction, if any, should be made. In the alternative, that the Appeal Panel should undertake a reassessment of the appellant’s degree of WPI.
The respondent’s submissions include the following:
(a)    the respondent submits the Medical Assessor has explained the reasons for making a deduction, having reviewed and considered the material provided.
(b)    Dr Alan Hopcroft, states the following: “…I believe only 10% of her impairment should be subtracted from 15%, leaving her with a WPI from her hip of 13.5%, which rounds to a 14% WPI…” “…with radiological changes of pre-existent arthritis in her knee, I believe one-tenth of that impairment should be subtracted, leaving her with a 27% WPI…”
(c)    Dr Bosanquet records: “…due to the obvious pre-existing degenerative changes, I have deducted two thirds, leaving a 5% WPI…” And at page 10: “…due to the severe degenerative changes pre-existing, I have deducted 50% leaving 10% WPI…”
(d)    At page 3 of the MAC, the Medical Assessor notes he was able to review imaging on the PRP PACS site and identified an MRI of the right knee dated 21 March 2019. This investigation revealed, patellofemoral osteoarthritis, and degenerative signal in the knee in the lateral menisci. An X-ray of the pelvis and right hip from 15 June 2021, revealed end stage osteoarthritis.
(e)    Based on the appellant’s radiological scans, the documents enclosed to the Medical Assessor, and the history provided to him, the Medical Assessor diagnosed the appellant with an aggravation of pre-existing patellofemoral arthritis.
(f)    Ultimately, the Medical Assessor in this matter has not failed to take a history or consider whether the appellant has pre-existing conditions, as he has correctly reviewed the evidence before him, and made a judgement based on the appellant’s condition at the time of the assessment.
(g)    The appellant’s submissions merely cavil with the findings of the Medical Assessor, rather than address any demonstrable error on an objective and factual basis in the MAC (Pitsonis v Registrar of WCC & Anor (2008) NSWCA 88).
(h)    The appellant submits she reported no symptoms of any pain in her right hip prior to the date of injury. In Mark v Secretary, Department of Communities and Justice [2021] NSWSC 306 [22], it was noted just because a previous injury is asymptomatic at the time when a later impairment is being assessed, does not mean that the effects of the previous injury can be ignored.
(i)    The Appeal Panel cannot be satisfied the submissions on appeal support the MAC contains a demonstrable error.
(j)    In the decision of The UGL Rail Services Pty Ltd (formerly United Group Rail Services Pty Ltd) v Attard [2016] NSWSC 911 Davies J at [41] said:
“In my opinion, an error suggesting that symptoms should be characterised in a particular way, whether being regarded as falling within a particular specified Class or assessed at some particular percentage or range of percentages, does not without more amount to a demonstrable error. What is involved in those type of assessments amounts to clinical judgment that ought not to be cavilled with.”
(k)    The MAC does not contain a demonstrable error. The MAC should be confirmed.

FINDINGS AND REASONS

The procedures on appeal are contained in s 328 of the 1998 Act. The appeal is to be by way of review of the original medical assessment but the review is limited to the grounds of appeal on which the appeal is made.
In Campbelltown City Council v Vegan [2006] NSWCA 284 the Court of Appeal held that the Appeal Panel is obliged to give reasons. Where there are disputes of fact it may be necessary to refer to evidence or other material on which findings are based, but the extent to which this is necessary will vary from case to case. Where more than one conclusion is open, it will be necessary to explain why one conclusion is preferred. On the other hand, the reasons need not be extensive or provide a detailed explanation of the criteria applied by the medical professionals in reaching a professional judgement.

Ground 1 – s 323 deduction

The appellant submits that the Medical Assessor failed to provide any or any sufficient reasons for his decision to deduct one third for a pre-existing condition in the right knee and one-half for a pre-existing condition in the right hip.
The Court of Appeal in Vegan dealt with an Assessor’s obligation to provide reasons and stated at [121]:
“Where it is necessary for the panel to make findings of primary fact, in order to reach a particular conclusion as to the existence, nature and extent of any physical impairment, it may be expected the findings of material facts will be set out in its reasons. Where facts are in dispute, it may be necessary to refer to evidence or other material on which findings are based, but the extent to which this is necessary will vary from case to case. More importantly, where more than one conclusion is open, it will be necessary for the Panel to give some explanation of its preference for one conclusion over another. That aspect may have particular significance in circumstances where the medical members of a Panel have made their own assessment of the applicant's condition and have come to a different conclusion from that reached by other medical practitioners, as set out in reports provided to the Panel.”
The Appeal Panel reviewed the MAC.
The Medical Assessor under “history relating to the injury” wrote:
“On the date of injury, Ms Harbach was at work. There was a piece of electrical conduit on the floor, which she stepped on and her foot slipped. She stumbled with her knee impacting into the counter. Her knee swelled immediately. She went to her general practitioner, who organised x-rays and an MRI. She was referred to Orthopaedic Surgeon, Dr Hunter who initially recommended physiotherapy and a steroid injection. She went on to have an arthroscopy on her knee which was of no benefit. In May 2020 she underwent a right total knee replacement.
Clinical correspondence from Dr Hunter subsequently notes slow progress rehabilitating from the knee. Manipulation under anaesthetic was undertaken on 24 August 2020.
A clinical letter dated 15 June 2021 for the first time notes problems with the hip joint. Dr Hunter at that time notes ‘She has almost no ROM of her hip, which is certainly putting significant stress through the knee’. He concludes that ‘This is the reason why she has not been able to get off the stick and why the other reason she has ongoing knee pain’. He then recommends proceeding with total hip arthroplasty. This was undertaken on 6 March 2023”.
Under “Details of any previous or subsequent accidents, injuries or condition” the Medical Assessor wrote:
“Ms Harbach denies any previous injuries to her knee or hip.”

Under “Summary” the Medical Assessor wrote:
“Ms Harbach tripped at work and struck her right knee on a counter. This presumably aggravated pre-existing patellofemoral arthritis. She underwent arthroscopy and total knee replacement without benefit. She was subsequently found to have osteoarthritis of her hip and underwent a hip replacement.”.
Under “Evaluation of Permanent Impairment” the Medical Assessor answered the following questions:
“e. Is any proportion of loss of efficient use or impairment or whole person impairment, due to a previous injury, pre-existing condition or abnormality?
Yes.
f. If so, please indicate which body part/system is affected by the previous injury, pre-existing condition or abnormality.
Right lower extremity (hip and knee)”.
Under “Deduction (if any) for the proportion of the impairment that is due to previous injury or pre-existing condition or abnormality” the Medical Assessor wrote:
“a)     In my opinion the worker suffers from the following relevant previous injuries, preexisting conditions or abnormalities:
(i) Patellofemoral arthritis right knee.
(ii) Osteoarthritis right hip.
b)      The previous injury, pre-existing condition or abnormality directly contributes to the following matters that were taken into account when assessing the whole person impairment that results from the injury, being the matters taken into account in 10a, and in the following ways:
(i) The injuries to both the knee and hip represent aggravation of a pre-existing degenerative pathology. Without this pathology, Ms Harbach would not have undergone either her knee replacement or hip replacement.
c)      Knee: Whilst the extent of the deduction is difficult or costly to determine the available evidence is that the deductible proportion is large and a deduction of one tenth is at odds with the available evidence. In my opinion the deductible proportion is one-third for the following reasons:
(i) The knee demonstrated pre-existing degenerative change in the patellofemoral joint without evidence of acute injury. In the absence of pre-existing degenerative disease, no surgical trearment (sic) on the knee would have been required and no impairment would have been assessed.
c) (sic)     Hip: Whilst the extent of the deduction is difficult or costly to determine the available evidence is that the deductible proportion is large and a deduction of one tenth is at odds with the available evidence. In my opinion the deductible proportion is one-half for the following reasons:
(i) Without evidence of pre-existing degenerative change in the hip, there would have been no injury to the hip, no requirement for a hip replacement and no assessable impairment.”

The Medical Assessor assessed 20% WPI of the right lower extremity (knee) and deducted one-third pursuant to s 323 which resulted in an assessment of 13% WPI for the right lower extremity (knee). The Medical Assessor assessed 15% WPI of the right lower extremity (hip) and deducted one-half pursuant to s 323 which resulted in an assessment of 8% WPI for the right lower extremity (knee). The combined total WPI was 20%.
The Appeal Panel reviewed the medical evidence relied on by the parties
Dr Hopcroft, consultant orthopaedic surgeon, in a report dated 16 April 2024, noted that the appellant had both an injury to her right knee and to her right hip in the fall on 22 February 2019. Dr Hopcroft assessed 15% WPI of the right hip. He noted that the appellant had “no symptoms of [sic] problems” with her right hip prior to the fall and had no treatment or plans for hip surgery prior to the work-related incident. He noted that the X-ray taken after the fall “suggests that she may well have suffered a minimally impacted subcapital fracture at the head of the femur”. He noted that the appellant was advised post-surgery by her treating surgeon, Dr Michael Hunter, that he thought that she did, in fact, fracture her hip in the work-related incident. Dr Hopcroft therefore believed that only 10% should be deducted from his assessment of 15% WPI, which resulted in an assessment of 13.5% rounded up to 14% WPI for the right hip.
In relation to the right knee, Dr Hopcroft considered that the appellant had a poor result from the knee replacement procedure and assessed 30% WPI. He wrote: “With radiological changes of pre-existent arthritis in her knee I believe one-tenth of that impairment should be subtracted, leaving her with a whole person impairment of 27%.” Dr Hopcraft calculated an overall WPI of 37%.
In a report dated 20 July 2023, Dr John Bosanquet, orthopaedic surgeon, noted that the appellant twisted her knee and hip in the fall on 22 February 2019. He noted that Dr Hunter performed an arthroscopy on 3 June 2019 which showed widespread osteoarthritis, particularly in the patellofemoral joint and medial compartments. He noted that as symptoms did not improve, Dr Hunter performed a total knee replacement on 4 May 2020. Dr Bosanquet reported that at this point it was recognised that the appellant had a loss of movement in her right hip and X-rays revealed “severe osteoarthritis”. On examination, Dr Bosanquet noted that the appellant had a full range of movement in the left hip and left knee.
Dr Bosanquet assessed 15% WPI of the right hip and deducted two thirds for obvious pre-existing degenerative change, which resulted in an assessment of 5% WPI for the right hip. Dr Bosanquet assessed 20% WPI of the right knee, being a fair result, and deducted one-half due to severe pre-existing degenerative changes, which resulted in an assessment of 10% WPI for the right knee. The combined assessment was 15% WPI.
Dr Michael Hunter, treating orthopaedic surgeon, in a report dated 26 March 2019, noted that after injury on 20 February 2019, the knee “swelled up” and she attended her general practitioner (GP). He noted that radiography performed appeared normal but with ongoing pain, an MRI was performed. Dr Hunter wrote:
“She has had no previous pain with that knee, no previous symptoms and full function. She has been able to play sport, particularly basketball, both playing and refereeing until recently….
Examination reveals significant patella-femoral irritability, tenderness and crepitus both sides. There is medial jointline tenderness with a vaguely positive McMurray’s test…the hip moves well. The knee is grossly inflamed and swollen.”
Dr Hunter reported that the MRI revealed chronic patella-femoral degeneration with possible acute chondral flap. There was also an appearance of an acute chondral loss on the medial femoral condyle and the meniscus was frayed but generally intact.
Dr Hunter concluded that the appellant had asymptomatic patellofemoral problems but with an acute injury suggestive of either of chondral flap medial femoral condyle or a chondral flap retropatellar surface. He considered that she was now significantly symptomatic.
In a report dated 15 June 2021, Dr Hunter noted that the knee was irritable. He noted on examination that the pain in her knee was arising from her hip. He wrote:
“She has almost no ROM of her hip which certainly is putting significant stress through the knee, particularly with certain exercises. I obtained a radiograph today which reveals significant destruction and collapse of the right hip compared to the left.
….
“Although we had no radiographs of the hip initially, the initial examination back in March 2019 revealed good ROM of the hip. In the last two years her right hip has deteriorated. The assumption is that she injured her hip at the time of her fall and two years of limping because of her knee has caused this to deteriorate significantly. “
In a report dated 9 July 2021, Dr Hunter noted that the hip had completely collapsed with significant bone-on-bone, fragments within the hip with minimal movement. He wrote:
“Renee’s hip was documented and radiographed 2 years ago at the time of the injury and was normal so this has occurred subsequent to her injury and subsequent to her treatment.
…
The surgery would have been unlikely to be required anyway as her other hip does not show any arthritis present and she is young to experience hip arthritis symptoms without associated trauma. Renee does have stiffness in her right knee, It is possible that this has been gradually worsening due to her hip function and by fixing her hip the range of movement should increase”.
The appellant referred to the decision of Page and submitted that as she underwent both a right total knee replacement and a right total hip replacement, the effect of both procedures was the removal of all arthritic tissue is removed.
The Appeal Panel noted that Page can be distinguished from this matter as the second Appeal Panel in Page found that without the aggravation/exacerbation the pre-existing condition would not of itself required surgery. In this matter, the Appeal Panel is satisfied that the pre-existing condition in the right knee would have required surgery at some stage because of the extensive pre-existing degenerative change. In relation to the right hip, the Appeal Panel decided, on balance, that the degree of degenerative change in the hip was such that the appellant would have required surgery at a later stage. The Appeal Panel notes that the fact that the appellant’s normal range of movement in the right hip following the injury on 20 February 2019 did not preclude her having a pre-existing osteoarthritic condition in the right hip. It is highly unlikely that the appellant would have developed such extensive osteoarthritis in the right hip in a period of just over two years following her injury in February 2019 unless there had been a pre-existing osteoarthritic condition in the right hip.
The Medical Assessor states in respect of a s 323 deduction:
“The injuries to both the knee and hip represent aggravation of a preexisting degenerative pathology. Without this pathology, Ms Harbach would not have undergone either her knee replacement or hip replacement.”
Other than identifying the pathology, which was relied upon in the report of Dr Bosanquet, the Medical Assessor took no real history of any pre-existing symptoms or restrictions in the right knee and hip prior to the subject injury or considered whether the appellant had any pre-existing symptoms or restrictions from the pre-existing pathology at the time of the subject injury. In those circumstances, the Appeal Panel accept that the Medical Assessor failed to provide adequate reasons for the deduction made where the appellant was asymptomatic prior to the work injury and engaged in vigorous sporting activities. The Medical Assessor simply identified pre-existing pathology and applied a substantial deduction and failed to provide sufficient reasoning for that deduction. The failure to provide adequate reasons is a demonstrable error.
The Appeal Panel is satisfied that the appellant had a pre-existing degenerative condition in the right knee and right hip.
Section 323 of the 1998 Act provides:
“(1)    In assessing the degree of permanent impairment resulting from an injury, there is to be a deduction for any proportion of the impairment that is due to any previous injury (whether or not it is an injury for which compensation has been paid or is payable under Division 4 of Part 3 of the 1987 Act) or that is due to any pre-existing condition or abnormality.
(2)     If the extent of a deduction under this section (or a part of it) will be difficult or costly to determine (because, for example, of the absence of medical evidence), it is to be assumed (for the purpose of avoiding disputation) that the deduction (or the relevant part of it) is 10% of the impairment, unless this assumption is at odds with the available evidence.
Note. So if the degree of permanent impairment is assessed as 30% and subsection (2) operates to require a 10% reduction in that impairment to be assumed, the degree of permanent impairment is reduced from 30% to 27% (a reduction of 10%).
(3)     The reference in subsection (2) to medical evidence is a reference to medical evidence accepted or preferred by the medical assessor in connection with the medical assessment of the matter.
(4)     The WorkCover Guidelines may make provision for or with respect to the determination of the deduction required by this section”.
The approach to be taken in assessing the s 323 deduction was considered by the Supreme Court in Cole v Wenaline Pty Limited [2010] NSWSC 78 (Cole). Schmidt J said:
“29    ...The section is directed to a situation where there is a pre-existing injury, pre-existing condition or abnormality. For a deduction to be made from what has been assessed to have been the level of impairment which resulted from the later injury in question, a conclusion is required, on the evidence, that the pre-existing injury, pre-existing condition or abnormality caused or contributed to that impairment.
30     Section 323 does not permit that assessment to be made on the basis of an assumption or hypothesis, that once a particular injury has occurred, it will always, ‘irrespective of outcome’, contribute to the impairment flowing from any subsequent injury. The assessment must have regard to the evidence as to the actual consequences of the earlier injury, pre-existing condition or abnormality. The extent that the later impairment was due to the earlier injury, pre-existing condition or abnormality must be determined. The only exception is that provided for in s 323(2), where the required deduction ‘will be difficult or costly to determine (because, for example, of the absence of medical evidence)’. In that case, an assumption is provided for, namely that the deduction ‘is 10% of the impairment'. Even then, that assumption is displaced, if it is at odds with the available evidence.
31     ...That is a matter of fact to be assessed on the evidence led in each case”.
At [38] of Cole, Schmidt said:
“38. What s 323 required, however, was that the evidence be considered, so that it could be determined, firstly, what the level of impairment after the second injury was. Secondly, whether a proportion of that impairment was due to the first injury. Thirdly, what that proportion was. Undoubtedly in undertaking this exercise, the medical members of an Appeal Panel must utilise their medical judgement, knowledge and experience. Nevertheless, all stages of the statutory exercise must be undertaken in the light of the evidence and without the making of assumptions not provided for by the section.”
In Elcheikh v Diamond Formwork (NSW) Pty Ltd [2013] NSWSC 365Schmidt J referred to her decision in Cole, stating:
“88. Section 323 requires that once the level of impairment which results from a work injury has been established, that a medical specialist must make 'a deduction for any proportion of the impairment that is due to any previous injury'. As discussed in Cole v Wenaline Pty Limited at [29] that requires a conclusion: ‘on the evidence, that the pre-existing injury, pre-existing condition or abnormality caused or contributed to that impairment'.”
In Ryder v Sundance Bakehouse [2015] NSWSC 526Campbell J considered the legislative and authoritative history of s 323. He said at [42]:
“In the present context the critical question is the causation question which, expressed by adapting the terms of the statute is whether a portion of the 15 per cent whole person impairment Ms Ryder suffered as a result of her work injury was due to a pre-existing condition or abnormality i.e. degenerative disc disease. The argument advanced on behalf of Ms Ryder is effectively that the proportion must be capable of assessment in accordance with the WorkCover Guides for s 323(1) to be satisfied. With respect this overlooks the requirement that the section must be read as a whole and in its legislative context. ...
43. I acknowledge that the express words of s 323(1) require that some definite part, even if it is difficult or costly to assess in precise terms, of the impairment has been caused by, in this case, a pre-existing condition. But the interpretation adopted by the Court of Appeal is that the section is engaged if the pre-existing condition, or previous injury where applicable, is a concurrent necessary condition, with the work injury, of the degree of permanent impairment.”
The process for determining impairment and any appropriate s 323 deduction was set out by Garling J in Pereira v Siemens Ltd [2015] NSWSC 1133 at [83]-[90] in a three-stage process being:
“The first step requires a finding of fact that the worker has suffered an injury at work which has resulted in a degree of permanent impairment which has been assessed pursuant to s 322 of the 1998 Act: see Elcheikh at [125].
The second step which needs to be addressed is, assuming such an injury has been sustained and impairment has resulted, what is the extent of that impairment expressed as a percentage of the whole person: see Cole v Wenaline Pty Ltd [2010] NSWSC 78 at [38]; Elcheikh at [126].
The third matter to be addressed is whether the worker had any previous injury, or any pre-existing condition or abnormality. The previous injury does not have to be one in respect of which compensation is payable under the 1998 Act. If the phrase ‘pre-existing condition or abnormality’ is to be relied upon, then such condition or abnormality must be a diagnosable or established clinical entity: Fire & Rescue NSW v Clinen [2013] NSWSC 629.
A finding of the existence of a previous injury can be made without the presence of symptoms, but there must be evidence which demonstrates the existence of that pre-existing condition: Mathew Hall at [31]-[32].
The pre-existing injury or condition must, on the available evidence, have caused or contributed to the assessed whole person impairment: see Matthew Hall at [32]; Cole at [29]-[31]; Elcheikh at [88] and Ryder at [42].
It cannot be assumed that the mere existence of a pre-existing injury means that it has contributed to the current whole person impairment: Clinen at [32]; Cole at [30]; Elcheikh at [91]. What must occur is that there must be an enquiry into whether there are other causes of the whole person impairment which reflect a difference in the degree of impairment: Ryder at [45].”
The Appeal Panel accepts that s 323 of the 1998 Act requires that a deduction be made “for any proportion of the impairment that is due to any previous injury or that is due to any pre- existing condition or abnormality.”
The Appeal Panel is satisfied that a proportion of the assessment of impairment in the right knee and in the right hip is due to the pre-existing conditions. The question to be addressed is what proportion of the impairment assessed by the Medical Assessor is due to those pre-existing conditions.
The Appeal Panel accepts that the appellant was asymptomatic in the right knee and right hip prior to the work injury. The Appeal Panel noted that Dr Hunter on 26 March 2019 reported that the appellant had no previous pain with the right knee, no previous symptoms and full function. Dr Hunter noted that the appellant had been able to play sport, particularly basketball, both playing and refereeing. Dr Hunter also noted that the appellant had a good range of movement in the right hip.
In relation to the right knee, the Appeal Panel considers that a deduction of one quarter for the pre-existing degenerative condition should be applied given the extent of the pre-existing osteoarthritis in the right knee. A deduction of one-tenth would be at odds with the evidence particularly in view of the extent of the advanced osteoarthritis in the right knee demonstrated in the MRI scan dated 21 March 2019.
In relation to the right hip, the Appeal Panel considers that a deduction of one quarter for the pre-existing degenerative condition should be applied given the extent of the pre-existing osteoarthritis in the right hip. A deduction of one tenth would be at odds with the evidence and the end stage osteoarthritis in the right hip demonstrated in the X-ray dated 15 June 2021.
The Medical Assessor assessed 20% WPI of the right knee. Applying a deduction of one-quarter or 5% WPI for the pre-existing condition results in an assessment of 15% WPI for the right knee. The Medical Assessor assessed 15% WPI for the right hip. Applying a deduction of one quarter for the pre-existing condition, that is, 3.75%, results in 11.25%, which is rounded down to 11% WPI. The Appeal Panel, therefore, assesses the combined total WPI as 24% WPI.
For these reasons, the Appeal Panel has determined that the MAC issued on 4 September 2024 should be revoked, and a new MAC should be issued. The new certificate is attached to this statement of reasons.

WORKERS COMPENSATION DIVISION

APPEAL PANEL

MEDICAL ASSESSMENT CERTIFICATE

Injuries received after 1 January 2002

Matter number:	W22673/24
Applicant:	Renee Harbach
Respondent:	Noni B Holdings Pty Limited

This Certificate is issued pursuant to s 328(5) of the Workplace Injury Management and Workers Compensation Act1998.

The Appeal Panel revokes the Medical Assessment Certificate of Medical Assessor Rob Kuru and issues this new Medical Assessment Certificate as to the matters set out in the table below:

Table - whole person impairment (WPI)

Body Part or system	Date of Injury	Chapter, page and paragraph number in NSW workers compensation guidelines	Chapter, page, paragraph, figure and table numbers in AMA 5 Guides	% WPI	Proportion of permanent impairment due to pre-existing injury, abnormality or condition	Sub-total/s % WPI (after any deductions in column 6)
1.Right lower extremity (knee)	22/2/19	P21 T17.35	P548 17.34 P546 17.33	20	1/4	15
2.Right lower extremity (hip)	22/2/19	P21 T 17.35	P548 17.34 P 546 17.33	15	1/4	11 (11.25 rounded down to 11)
Total % WPI (the Combined Table values of all sub-totals)					24%

[2024] NSWPICMP 803

27 November 2024