Herborn v Spotless Services Australia Limited
[2020] NSWWCCPD 24
•24 April 2020
| DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR | |
| CITATION: | Herborn v Spotless Services Australia Limited [2020] NSWWCCPD 24 |
| APPELLANT: | Stephen John Herborn |
| FIRST RESPONDENT: | Spotless Services Australia Limited |
| SECOND RESPONDENT: | Precise Air Group Pty Ltd |
| INSURER: | AAI Limited trading as GIO |
| FILE NUMBER: | A1-2576/19 |
| ARBITRATOR: | Mr J Wynyard |
| DATE OF ARBITRATOR’S DECISION: | 25 October 2019 |
| DATE OF APPEAL DECISION: | 24 April 2020 |
| SUBJECT MATTER OF DECISION: | Section 59A(6)(a) of the Workers Compensation Act 1987 – whether a bone graft, pedicle screws and interbody cage to be implanted in surgery involving a lumbar decompression and spinal fusion constitutes an “artificial aid” – Thomas v Ferguson Transformers Pty Ltd [1979] 1 NSWLR 216, Pacific National Pty Ltd v Baldacchino [2018] NSWCA 281 considered and applied |
| PRESIDENTIAL MEMBER: | Deputy President Elizabeth Wood |
| HEARING: | On the papers |
| REPRESENTATION: | Appellant: Mr P Stockley, counsel Masselos & Co Lawyers |
| First and Second Respondents: Mr T Ainsworth, solicitor HWL Ebsworth | |
| ORDERS MADE ON APPEAL: | 1. The Arbitrator’s Certificate of Determination dated 25 October 2019 is revoked and the following findings and orders are made in its place: (a) The provision of a bone graft with pedicle screws and interbody cages to be implanted in a spinal nerve root decompression and fusion is an “artificial aid” for the purposes of s 59A(6)(a) of the Workers Compensation Act 1987. (b) The respondents are to pay the costs of and incidental to the lumbar decompression and spinal fusion as proposed by Associate Professor Mark Davies pursuant to s 60 of the Workers Compensation Act 1987. |
INTRODUCTION
This appeal concerns a claim by Mr Stephen Herborn (the appellant) for treatment expenses pursuant to s 60 of the Workers Compensation Act 1987 (the 1987 Act) in respect of proposed surgery. The surgery, which was proposed by the appellant’s treating surgeon Associate Professor Mark Davies, neurosurgeon, was described by A/Prof Davies as a “re-do” lumbar laminectomy, pedicle screw internal fixation and fusion.
The appellant sought approval for the surgery from both Spotless Services Australia Limited (the first respondent) and Precise Air Group Pty Ltd (the second respondent). Initially, the claim was denied on the basis that the surgery was not reasonably necessary as required by s 60 of the 1987 Act. Ultimately, when the matter came to arbitration, the issue between the parties was limited to whether the proposed surgery was for the provision of “artificial aids” in accordance with s 59A(6)(a) of the 1987 Act. Section 59A precludes payment of treatment expenses incurred beyond two years after weekly payments have ceased but subs 59A(6)(a) provides, among other things, that if the treatment is for the provision of artificial aids, the preclusion in s 59A does not apply.
BACKGROUND
The appellant initially suffered an injury to his lumbar spine in 1990 when he was self-employed. He came under the care of Dr John Sheehy, neurosurgeon, who performed a lumbar laminectomy in 1991. The surgery was largely successful, in that the appellant’s sciatic pain resolved, but the appellant reported occasional lower back pain thereafter.
The appellant experienced a flare up of back pain in 1998 and was referred to A/Prof Davies, who recommended conservative treatment, following which the pain settled.
The appellant commenced work with the second respondent in 2009 as a handyman. Over the course of a period of work in that employment in October 2010, the appellant suffered a further back injury. The appellant was re-referred to A/Prof Davies, who again prescribed conservative treatment. The appellant ceased work with the second respondent shortly afterwards because of a downturn in available work.
The appellant commenced work with the first respondent in about mid-2011. On 11 November 2011, the appellant suffered a further lumbar injury and was certified unfit for work. The appellant experienced severe pain in the back which extended into the left thigh, calf and down to the foot.
The appellant received weekly payments of compensation from 19 December 2011 on a voluntary basis in accordance with consent orders filed in the Commission on 12 December 2012. The evidence about when those payments ceased is unclear, but it is sufficient to say that payments continued until either 16 September 2014[1] or 10 April 2015[2], when liability ceased in accordance with s 39 of the 1987 Act. Section 39 provides for the cessation of weekly payments after 260 weeks during which weekly payments are paid or payable, except if the worker has a whole person impairment of greater than 20% pursuant to s 66 of the 1987 Act.
[1] Transcript of Arbitrator’s reasons for determination, 23 October 2019 (T), T5.32.
[2] Notice issued pursuant to s 78 of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act), Application to Resolve a Dispute (ARD), pp 47–50.
In March 2012 the appellant consulted with A/Prof Davies, who recommended further surgery and on 19 April 2012, A/Prof Davies performed a lumbar discectomy. The appellant’s symptoms continued and deteriorated despite further conservative treatment.
The appellant consulted A/Prof Davies again on 2 February 2015, when A/Prof Davies recommended the surgery the subject of these proceedings. The respondents denied liability for the surgery. The appellant reported continuing significant pain and disability and expressed the desire to undergo the proposed procedure at the hands of A/Prof Davies.
The appellant has not pursued his entitlement to lump sum compensation pursuant to s 66 of the 1987 Act because his back condition has not stabilised and the proposed surgery may change the extent of his whole person impairment.
ON THE PAPERS
Section 354(6) of the Workplace Injury Management and Workers Compensation Act 1998 (the 1998 Act) provides:
“(6) If the Commission is satisfied that sufficient information has been supplied to it in connection with proceedings, the Commission may exercise functions under this Act without holding any conference or formal hearing.”
Both parties agree that the appeal can be determined ‘on the papers.’
I have had regard to Practice Directions Nos 1 and 6, the documents that are before me, and the submissions by the parties that the appeal can proceed to be determined on the basis of those documents. I am satisfied that I have sufficient information to proceed ‘on the papers’ without holding any conference or formal hearing and that this is the appropriate course in the circumstances.
THRESHOLD MATTERS
There is no dispute between the parties that the threshold requirements as to quantum and time pursuant to ss 352(3) and 352(4) of the 1998 Act have been met.
Neither party seeks to have further evidence admitted in the appeal in accordance with s 352(6) of the 1998 Act.
THE EVIDENCE
Given the narrow scope of this appeal, it is not necessary to review the entirety of the evidence in this matter. The following summary of the evidence is relevant to a consideration of whether the surgery proposed can be considered to be the provision of “artificial aids” for the purpose of s 59A(6)(a) of the 1987 Act.
Associate Professor Mark Davies, neurosurgeon
A/Prof Davies provided a number of medical reports.
On 11 November 2010 and 24 December 2010, A/Prof Davies reported to the appellant’s general practitioner, Dr JiIlian Nichols.[3] A/Prof Davies reported that the appellant had first consulted him in 1998 with a seven year history of back pain and had undergone back surgery at the hands of Dr John Sheehy, neurosurgeon. A/Prof Davies advised that the appellant’s pain had settled with conservative treatment, although he experienced relapses in pain over the years and then suffered the second back injury in October 2010. Further back surgery was discussed. A/Prof Davies noted that by 24 December 2010, the appellant’s back pain had improved, so that he did not want to undergo further surgery.
[3] ARD, pp 69–70.
A/Prof Davies provided a report dated 8 June 2012 directed to the appellant’s legal representatives.[4] A/Prof Davies confirmed the appellant’s prior history of back difficulties and noted the appellant’s further work related injury in November 2011, which caused severely worse symptoms, culminating in the appellant having to cease work a month or two later.
[4] ARD, pp 71–74.
A/Prof Davies described the appellant’s symptoms as back and left leg pain extending into the thigh, buttock and calf, with new numbness affecting the left foot. A/Prof Davies reported that the appellant had difficulties swimming and paddling in water. A/Prof Davies discussed the most recent MRI scan and the benefit and risks of a lumbar discectomy. A/Prof Davies reported that the appellant underwent a partial L4 laminectomy and rhizolysis of the L5 nerve root.
A/Prof Davies informed the appellant’s legal representatives that the appellant would continue to suffer fluctuating levels of back pain in the future and that if the appellant developed severe prolonged pain in the future, a “re-do” lumbar discectomy, pedicle screw internal fixation and fusion may be required.
A/Prof Davies provided a further report dated 16 April 2014 in support of a claim for total and permanent impairment benefits.[5] A/Prof Davies advised that he had reviewed the appellant again in August 2013 because of continuing back pain and difficulties. A/Prof Davies said that he had discussed surgery in the form of a lumbar discectomy pedicle screw internal fixation and fusion, but that the appellant had decided at that stage that the risks were too great.
[5] ARD, pp 76–77.
On 2 February 2015, A/Prof Davies again reported to Dr Nichols, advising that the appellant’s condition had further deteriorated, and he was complaining of “horrific” pain over the preceding twelve months.[6] A/Prof Davies recorded that the appellant had difficulty standing upright, that any exercise aggravated the pain, and that he spent most of the day lying down. A/Prof Davies described the appellant’s condition as disabling and noted that conservative treatment had failed to alleviate those symptoms. A/Prof Davies advised that he had again discussed the proposed fusion surgery and noted that the appellant now wished to proceed.
[6] ARD, p 78.
A/Prof Davies further corresponded with the appellant’s legal representatives on 19 February 2017[7] and with Dr Nichols on 8 July 2019,[8] discussing the benefits of the proposed surgery, which he advised would give the appellant a 70% chance of alleviating his left leg radiculopathy and improve his lifestyle.
[7] ARD, p 79.
[8] Appellant’s Application to Admit Late Documents (AALD) dated 16 August 2019.
A/Prof Davies described the procedure that would be involved in the proposed surgery in a report dated 23 May 2019.[9] He advised that the procedure would take several hours and had the primary purpose of ensuring adequate decompression of the L4 and L5 nerve roots at that level. The procedure would require removal of sufficient bone from the spine, which would render the spine unstable. The instability would be addressed by permanently stabilising the spine by way of a fusion of the L4 and L5 vertebrae. This would involve harvesting a bone graft from the pelvis which would then be placed between the two vertebrae. A/Prof Davies said that it was necessary to keep the bones motionless in order for them to knit together, which was achieved by inserting “hardware” consisting of pedicle screws, connected by rods called interbody cages. A/Prof Davies said that the fusion of the bone takes six months or more and the fixation of the hardware was an inherent part of the spinal fusion. A/Prof Davies confirmed that a solid fusion was necessary in order to eliminate the appellant’s pain and disability.
[9] ARD, pp 80–81.
Dr James K Evans, orthopaedic surgeon
Dr Evans was qualified by the respondents to provide an opinion and report. In his report dated 27 January 2015,[10] Dr Evans expressed the view that:
“I do believe that there are still physical disabilities which probably could only be solved by more extensive surgery. This might take the form of decompression involving the bony tissue rather than the disc and failing that a spinal fusion at L4/5.”[11]
[10] Annexures “A” and “B”, Respondents’ Replies to the Application to Resolve a Dispute (replies), pp 7–12.
[11] Dr Evans’ report p 4, replies, p 10.
Dr Evans thought that the appellant’ longstanding, non-work related psychological condition would be an adverse factor and was of the view that the appellant’s condition was not work related.
Dr Paul Miniter, orthopaedic surgeon
Dr Miniter was also qualified by the respondents to provide a medico-legal opinion. In his report dated 13 January 2012,[12] Dr Miniter took a rather sceptical view of the appellant’s motivation and the connection between the appellant’s condition and the appellant’s employment. Nonetheless, Dr Miniter considered that, ultimately, the appellant would require a localised fusion and decompression.
[12] Replies, pp 1–6.
Dr Peter Endrey-Walder, general and trauma surgeon
Dr Endrey-Walder was qualified by the appellant’s legal representatives to provide an opinion in respect of the proposed surgery. Dr Endrey-Walder had previously examined the appellant in 2012. In his report dated 23 June 2015,[13] Dr Endrey-Walder recorded a detailed history of the appellant’s injuries, treatment and persisting, worsening symptoms. He noted that the appellant remained affected by significant chronic lower back pain with associated left leg sciatica, walked permanently with a limp and had difficulty sitting. Dr Endrey-Walder referred to his earlier report in which he had expressed the view that given the appellant’s radiological images, A/Prof Davies may well recommend a spinal fusion which Dr Endrey-Walder considered to be eminently reasonable. Dr Endrey-Walder also noted the opinion of Dr Evans that the symptoms could only be relieved by surgery which may include a fusion. Dr Endrey-Walder confirmed his view that that the appellant was in need of the surgery proposed by A/Prof Davies.
[13] ARD, pp 62–67.
THE ARBITRATOR’S REASONS
The Arbitrator delivered his reasons for determination orally on 23 October 2019.
The Arbitrator summarised the history of the appellant’s employment, the injuries to the appellant’s back, the radiological investigations, both the previous back surgeries and the surgery proposed by A/Prof Davies. The Arbitrator referred to the evidence of Dr Endrey-Walder, as well as the opinion of Dr Evans. The Arbitrator noted that there was no dispute among the medical experts that the proposed surgery was reasonably necessary and observed that such unanimity was rare.
The Arbitrator noted, however, that the issue for determination was whether the proposed surgery amounted to the provision of artificial aids, so that the compensation for the treatment expenses of the appellant’s surgery was not precluded by s 59A of the 1987 Act. The Arbitrator recorded the contents of subs 59A(6)(a) and observed that it was common ground between the parties that this was the only basis upon which the appellant could be entitled to have the costs of the surgery met by the respondents.
The Arbitrator turned to the evidence provided by A/Prof Davies as to the procedure to be undertaken. The Arbitrator referred to A/Prof Davies’ letter dated 23 May 2015 in which A/Prof Davies had pointed out that he had not seen the appellant since 11 October 2016, but that on the assumption that the appellant’s condition had not changed, the recommended procedure would involve a repeat laminectomy, an L4/5 pedicle screw internal fixation and fusion. The Arbitrator extensively quoted from the report of A/Prof Davies.
The Arbitrator reviewed the submissions of both parties. He included reference to the Court of Appeal decision in Pacific National Pty Ltd v Baldacchino,[14] and the discussion in that case by Macfarlan JA of what constituted “artificial aids,” in which his Honour referred to the Court of Appeal’s earlier decision in Thomas v Ferguson Transformers Pty Ltd.[15] The Arbitrator quoted from relevant parts of both the judgments. The Arbitrator observed that Baldacchino concerned surgery involving a total knee replacement and Thomas concerned the provision of modifications to a motor vehicle.
[14] [2018] NSWCA 281 (Baldacchino).
[15] [1979] 1 NSWLR 216 (Thomas).
The Arbitrator also referred to his own decision in Xayamongkhoun v Fairfield City Council,[16] in which he found that a spinal stimulator satisfied the criteria defined in those cases and was considered to be an artificial aid. The parties had been given the opportunity to address on that decision.
[16] [2019] NSWWCC 227.
The Arbitrator summarised the submissions made by the parties. He noted the appellant submitted that:
(a) the pedicle screws and cage which were to be inserted to keep the bone graft in place were no different to an artificial tooth insert, provision of which was also included in subs 59A(6)(a) as exempt from the operation of s 59A;
(b) the only purpose of the pedicle screws and cage was to facilitate the graft and were only used surgically for the benefit of the person requiring the surgery;
(c) this type of operation was specifically tailored to the needs of a particular person, and
(d) if a spinal stimulator could be considered an artificial aid, then so should the insertion of a bone graft.
The Arbitrator considered those submissions “well made”, but that they did not overcome the respondents’ submissions, in which the respondents cited a passage from Baldacchino, in which Macfarlan JA cautioned:
“I should not be taken to be adopting a general rule that the cost of surgery is always a cost of ‘[t]he provision of ... artificial aids’, as there may be cases where the insertion of material into a person’s body is only an incidental part of major surgery. Each case must be decided on its own facts.”[17]
[17] Baldacchino, [42].
The Arbitrator explained that the distinction between this case and the case of a total knee replacement or spinal stimulator was that the insertion of those aids shared the common purpose of ameliorating the injured worker’s suffering. That is, an injured knee would be able to operate more efficiently, which ameliorated the worker’s condition. Similarly, the electrical impulses from a spinal cord stimulator were designed to ameliorate the worker’s spinal condition. The Arbitrator’s comment that followed was not transcribed.[18] The appellant submits that the Arbitrator presumably said that the purpose of inserting the pedicle screws and interbody cages was not to ameliorate the appellant’s back pain,[19] but rather they were an incidental part of the major surgery and were used to secure the bone in place. The respondents accept that inference as to what the Arbitrator said.[20]
[18] T13.10–35.
[19] Appellant’s appeal submissions, [16].
[20] Respondents’ appeal submissions, [16].
The Arbitrator noted the concession by the respondents that there was no evidence that the hardware would be subsequently removed. The Arbitrator considered that on the basis of his experience as an Arbitrator in relation to similar cases, it was open to him to infer that after the bone graft solidified and mended, the hardware would be removed.
The Arbitrator concluded that the aids in this case were designed to assist the surgeon to complete the surgery. The Arbitrator said that he did not accept that the legislation goes so far as to say that once the hardware is inserted and has served its purpose, then the surgery will have ameliorated the worker’s condition and not the hardware, which played only a part in that process.
The Arbitrator formed the view that, despite the surgery being necessary, s 59A of the 1987 Act prevented him from making an order that the respondents pay for that surgery.
The Certificate of Determination issued on 25 October 2019 records:
“The determination of the Commission in this matter is as follows:
1. There will be an award for the respondents.”
GROUNDS OF APPEAL
The appellant brings four grounds of appeal, alleging the Arbitrator:
(a) erred in law by misapplying the comments made by Macfarlan JA in Baldacchino, when the Arbitrator found that the insertion of the pedicle screws and cage was merely an incidental part of the major surgery (Ground One);
(b) erred in law by failing to consider the appellant’s submission that a bone graft supported by hardware itself constituted an “artificial aid” (Ground Two);
(c) erred in fact by finding that the hardware to be inserted in the spinal fusion could be removed, when there was no evidence to support that fact (Ground Three), and
(d) erred in law by considering:
(i)whether or not the hardware inserted in the spinal fusion would eventually be removed, and/or
(ii)whether the hardware would eventually be removed was relevant to the determination (Ground Four).
LEGISLATION
Section 59A of the 1987 Act provides:
“59A Limit on payment of compensation
(1) Compensation is not payable to an injured worker under this Division in respect of any treatment, service or assistance given or provided after the expiry of the compensation period in respect of the injured worker.
(2) The compensation period in respect of an injured worker is—
(a) if the injury has resulted in a degree of permanent impairment assessed as provided by section 65 to be 10% or less, or the degree of permanent impairment has not been assessed as provided by that section, the period of 2 years commencing on—
(i) the day on which the claim for compensation in respect of the injury was first made (if weekly payments of compensation are not or have not been paid or payable to the worker), or
(ii) the day on which weekly payments of compensation cease to be payable to the worker (if weekly payments of compensation are or have been paid or payable to the worker), or
(b) if the injury has resulted in a degree of permanent impairment assessed as provided by section 65 to be more than 10% but not more than 20%, the period of 5 years commencing on—
(i) the day on which the claim for compensation in respect of the injury was first made (if weekly payments of compensation are not or have not been paid or payable to the worker), or
(ii) the day on which weekly payments of compensation cease to be payable to the worker (if weekly payments of compensation are or have been paid or payable to the worker).
(3) If weekly payments of compensation become payable to a worker after compensation under this Division ceases to be payable to the worker, compensation under this Division is once again payable to the worker but only in respect of any treatment, service or assistance given or provided during a period in respect of which weekly payments are payable to the worker.
(4) For the avoidance of doubt, weekly payments of compensation are payable to a worker for the purposes of this section only while the worker satisfies the requirement of incapacity for work and all other requirements of Division 2 that the worker must satisfy in order to be entitled to weekly payments of compensation.
(5) This section does not apply to a worker with high needs (as defined in Division 2).
(6) This section does not apply to compensation in respect of any of the following kinds of medical or related treatment—
(a) the provision of crutches, artificial members, eyes or teeth and other artificial aids or spectacles (including hearing aids and hearing aid batteries),
(b) the modification of a worker’s home or vehicle,
(c) secondary surgery.
(7) Surgery is secondary surgery if—
(a) the surgery is directly consequential on earlier surgery and affects a part of the body affected by the earlier surgery, and
(b) the surgery is approved by the insurer within 2 years after the earlier surgery was approved (or is approved later than that pursuant to the determination of a dispute that arose within that 2 years).
(8) This section does not affect the requirements of section 60 (including, for example, the requirement for the prior approval of the insurer for secondary surgery).”
SUBMISSIONS
The respondents made preliminary submissions that even if the decision was affected by the errors alleged by the appellant, its overall submission is that those errors would not disturb the outcome. The respondents say that the relevant hardware, and if relevant the bone graft, is to enable the effects of the surgery (that is the decompression and laminectomy destabilising the spine) to be overcome. Further, the respondents contend that the appellant’s appeal has not addressed the requirement that the relevant hardware to be installed was not “specifically constructed” for the purpose. The respondents contend that the pedicle screws and interbody cages were standard items, having an item code, a rebate code and a unit price, in accordance with the accounts and receipts attached to the ARD.
The appellant responds to those submissions by asserting that the respondents’ submissions do not support, or (except for those responding to Ground Three) otherwise contain no rebuttal of the identified errors.
In response to the respondents’ assertion that the parts were required to be “specifically constructed”, the appellant says it is not obliged to respond to the proposition, despite it having been raised by the respondents at first instance. He contends that this is because the Arbitrator made no adverse finding in relation to the proposition and does not appear to have accepted the respondents’ proposition. The appellant says that, in any event, there can be no doubt that they are specifically constructed to enable the effects of the disability to be overcome. The appellant maintains that the construction is no less specific than hearing aids, crutches or hand controls for a motor vehicle, as in Thomas.
Ground One: the Arbitrator erred in law by misapplying the comments made by Macfarlan JA in Baldacchino, when the Arbitrator found that the insertion of the pedicle screws and cage was merely an incidental part of the major surgery
The appellant’s submissions
The appellant submits that in making this finding, the Arbitrator either overstated the comments made by Macfarlan JA at [42] or misapplied them. The appellant contends that the comments were not a “hard and fast” binding pronouncement as to the limits of s 59A(6)(a) of the 1987 Act but were a cautionary observation in rejecting the appellant’s “floodgate” argument in that case. The appellant points out that Macfarlan JA also observed that each case had to be determined on its own facts.
The appellant submits that the amelioration of the appellant’s pain was to be achieved by the decompression and stabilisation of the appellant’s spine. The appellant says that the stabilisation was to be achieved by inserting the pedicle screws, interbody cages and a bone graft, which worked together to facilitate the fusion resulting in relief of the appellant’s disability. The appellant asserts that the stabilisation was integral to the procedure, was achieved solely by the introduction of the hardware and was not merely incidental to the procedure.
The respondents’ submissions
The respondents accept that the cautionary comments made by Macfarlan JA in Baldacchino at [42] do not form part of the ratio decidendi of the decision, but are, however, intended to illustrate the underlying principle. The respondents submit that this caution validly informed the Arbitrator in the decision-making process. The respondents say that the decision-making process required a purposive approach to the proposed surgery.
The respondents dispute that the amelioration of the appellant’s pain is to be achieved by the stabilisation of the spine. The respondents contend that it is the decompression of the spine that gives rise to the need to stabilise the spine as it involves the removal of the supporting bone structures of the spine. The respondents assert that this was stated by the Arbitrator.
The respondents say that it was not in dispute that the hardware would need to be inserted to stabilise the spine, but submit that the relevant need is only incidental to the amelioration of the appellant’s pain, which is consistent with the cautionary comment by Macfarlan JA in Baldacchino.
The respondents assert that this case is analogous to a case where sutures are required to close a wound after surgery. The respondents assert that although sutures are central to the surgery (because the surgery would not be complete without them) they are simply incidental to the purpose of the operation.
The appellant’s submissions in reply
The appellant refers to the concession by the respondents that Macfarlan JA’s comments at [42] of the judgment do not form part of the ratio decidendi of Baldacchino. The appellant asserts that the respondents’ submissions do not support the Arbitrator’s approach but instead raise a new argument on appeal as to the extent to which the proposed surgery was intended to ameliorate the appellant’s pain. The appellant contends that the respondents’ argument is not responsive to Ground One of the appeal and that its submissions should properly be directed at a re-determination of the matter.
The appellant says that although he referred in his submissions to the amelioration of pain, the correct formulation as put forward by Macfarlan JA was an amelioration of the disability (which could include pain). In any event, the appellant says, the respondents’ submission is not supported by any evidence. The appellant refers to A/Prof Davies’ unequivocal statement that “A solid fusion is necessary in [the appellant’s] case at the L4/L5 level to eliminate his pain and disability.”[21]
[21] A/Prof Davies’ report dated 23 May 2019, p 2, ARD, p 81.
The appellant maintains that the respondents’ attempt to draw a distinction between the effects of a nerve root decompression and the fusion of the spine is not supported by the evidence. The appellant asserts that while the decompression may resolve the radiculopathy in the appellant’s leg, there is no support in the evidence that the nerve root decompression would ameliorate the appellant’s back pain and disability. The appellant says that there is also no support for the notion that stabilisation of the appellant’s spine was merely incidental to amelioration of the disability and, in fact, the evidence is to the contrary. The appellant maintains that the insertion of the hardware to fuse the spine is itself the thing that will ameliorate the disability.
The appellant contends that the respondents’ analogy with sutures that close a wound is a perfect illustration of the error in the respondents’ argument. The appellant says that sutures can truly be described as an incidental part of major surgery in the sense referred to by Macfarlan JA. The appellant submits that surgically affixed hardware that stabilises the spine clearly falls within a different category and constitutes a major part of the surgical procedure which directly facilitates the amelioration of the disability.
Ground Two: the Arbitrator erred in law by failing to consider the appellant’s submission that a bone graft supported by hardware itself constituted an “artificial aid”
The appellant’s submissions
The appellant complains that he expressly made this submission in his written submissions to the Arbitrator. That is, the grafted bone from the pelvis which is inserted into the spine is itself an artificial aid, as are the pedicle screws and interbody cages. The appellant submits that the bone graft combined with and supported by the hardware is also an artificial aid. The appellant says that the Arbitrator appeared to acknowledge that submission but then confined his deliberations to how the pedicle screws and interbody cages should be characterised. The appellant asserts that the Arbitrator’s failure to address this submission constitutes an error of law. The appellant says that the submission is an important one because it is consistent with the observation in Baldacchino that “artificial aids must … work to ameliorate the effect of the person’s disability and may comprise a single object or a composite of objects operating together.”[22]
[22] Baldacchino, [29].
The appellant submits that, as he submitted to the Arbitrator, the fusion would modify the appellant’s spine by removing the bone, replacing it with roughened grafted bone held in place by the hardware which would stabilise the spine and facilitate fusion of two previously independent vertebrae. The appellant says that the artificial construct changes the nature of the spine and stabilises it. That is, as it was in Thomas, it is something “specially constructed to enable the effects of the disability (the result of injury) to be overcome.”[23] The appellant submits that, as with the modification to the appellant’s vehicle in Thomas, the appellant’s spine was to be modified by the insertion of an artificial construct – the bone graft supported by the hardware that creates the fusion of the vertebrae. The appellant refers to Baldacchino, in which Macfarlan JA held that “Plainly these [introduced] materials are designed to facilitate the movement and use of the knee after the operation, therefore easing the patient’s disability.”[24]
[23] Thomas, per Hutley JA, 220–221.
[24] Baldacchino, [29].
The appellant contends that, in the event that Ground Four of the appeal is not made out and there was a requirement that the artificial aid be permanent, the Presidential member would in any event accept that the artificial aid in this case was permanent because the long term viability and reliability of the fusion is dependent upon the bone graft, which is itself an artificial aid and part of the composite of objects acting together.
The respondents’ submissions
The respondents contend that a bone graft cannot in any sense be considered an artificial aid because it is from a part of the appellant’s body. The respondents say there could be no “provision” of a bone graft for the purpose of subs 59A(6)(a) of the 1987 Act because it is harvested from the donor site and re-implanted in the spine. The respondents say that in any event, if the Arbitrator had determined that the bone graft was part of the artificial aid, it would not have changed the result because the basis of the Arbitrator’s finding was that the aid was not permanent.
The appellant submits that there is no similarity between a knee transplant which facilitates movement and the insertion of the hardware into the appellant’s spine, which prevents movement.
The appellant’s submissions in reply
The appellant asserts that the respondents have not attempted to justify the Arbitrator’s failure to address this submission and so have presumably accepted that error has been established. The appellant says that for the purposes of any re-determination, the respondents’ proposition is that the bone graft could not be an artificial aid because it was grafted from the appellant himself, which seeks to narrow the concept of an artificial aid in an impermissible way. The appellant refers again to Thomas and Hutley JA’s observation that the question to be considered is ‘whether it has been specially constructed to enable the effects of the injury to be overcome”. The appellant also refers to Baldacchino and says that the parties in that case accepted that “the nature of the material to be used in the operation is of no present consequence.”[25]
[25] Baldacchino, [22].
The appellant poses the question that, adopting the respondents’ argument for the moment, would the fusion fit the definition if the bone graft was donated by another human or some other animal or made from synthetic material? The appellant maintains that the transplanted bone itself meets the definition of an artificial aid, but in any event the artificial construct is not simply the bone, but the composite of each of the objects.
Ground Three: the Arbitrator erred in fact by finding that the hardware to be inserted in the spinal fusion could be removed, when there was no evidence to support that fact
The appellant’s submissions
The appellant submits that there was no evidence to support the Arbitrator’s conclusion and the inference he drew that the pedicle screws and cage would be removed. The appellant says that the finding of fact was not available to the Arbitrator.
The respondents’ submissions
The respondents submit that the inference drawn by the Arbitrator was open to him. The respondents say the Commission is a specialist tribunal and is entitled to “rely on its expertise in understanding the evidence before it and in drawing appropriate inferences from the evidence,” relying on Workers Compensation Nominal Insurer v Howard[26]
[26] [2011] NSWWCCPD 37, [89].
The respondents contend that even if this ground was made out, it would not result in a different outcome, because the permanency of the hardware does not affect the finding that the hardware is “designed to assist the surgeon to complete the surgery”, as reasoned by the Arbitrator.[27]
[27] T 14.12–14.
The appellant’s submissions in reply
The appellant says that while the authority relied upon by the respondents permits the specialist tribunal to draw inferences, that permission is limited to the drawing of appropriate inferences from the evidence. The appellant says that even if the Arbitrator had some specialist insight (which he disputes), the Arbitrator should have exposed his reasoning, which he did not do. Further, there was no suggestion (and nor could there be) that the bone graft was anything but permanent.
Ground Four: the Arbitrator erred in law by considering:
(a) whether or not the hardware inserted in the spinal fusion would eventually be removed, and/or
(b) whether the hardware would eventually be removed was relevant to the determination.
The appellant’s submissions
The appellant submits that the Court of Appeal made no suggestion at all in Baldacchino that the permanence or otherwise of the proposed aid was relevant to the consideration of whether or not it met the statutory criterion of being an “artificial aid”. The appellant says that such a consideration was irrelevant and led the Arbitrator into error.
The appellant refers to Hutley JA’s observations (with Hope JA agreeing) in Thomas that:
“An artificial aid, in my opinion, is anything which has been specially constructed to enable the effects of the disability (the result of injury) to be overcome. The other articles in the subclause, crutches, artificial members, eyes or teeth, are illustrations of this.”[28]
[28] Thomas, 220–221.
The appellant contends that this passage confirms the logical and acceptable proposition that a crutch is an artificial aid and that a crutch is a temporary means to support and stabilise bones thus enabling the mending process. The appellant asserts that there is no difference between a crutch and the proposed provision of pedicle screws and interbody cages. The appellant maintains that in both cases, the artificial aid supports and stabilises an area of bone in order to facilitate fusion.
The respondents’ submissions
The respondents concede that the caselaw does not require that an artificial aid should be permanent. The respondents indicate that there is a real difference between a crutch and the provision of pedicle screws and interbody cages. That is, a crutch is used to facilitate movement, thus ameliorating the disability, whereas pedicle screws and interbody cages are designed to inhibit movement. That is, they are not for the purpose of ameliorating disability but to ameliorate the consequence of a spinal decompression or laminectomy.
The appellant’s submissions in reply
The appellant criticises the respondents’ submission about the ameliorating effects of crutches, which the appellant says demonstrates the frailty of the respondents’ argument. The appellant submits that a crutch can be used in various situations at various times, to assist with recovery, relieve symptoms or facilitate or improve movement (such as with a broken leg). The appellant contends that any of these uses satisfies the requirements of s 59A(6)(a) of the 1987 Act.
The appellant submits that there is no basis for the proposition that the aid must facilitate mobility, when all that is required is that it ameliorate disability. The appellant explains that the movement of an unstable spine gives rise to an instability, so that the insertion of an object to stabilise the spine meets the definition of an artificial aid.
The appellant refers to the respondents’ example as “specious.” The appellant says that if a person with a broken leg uses crutches, the crutches do not facilitate movement of the broken leg. The crutches facilitate the movement of a person, just as a spinal fusion enables movement without the disabling symptoms caused by an unstable spine.
The relief sought
The appellant seeks to have:
(a) the appeal allowed;
(b) the Certificate of Determination dated 25 October 2019 revoked, and
(c) in lieu thereof an order that the respondents pay the cost of the proposed treatment in the form of a “re-do” lumbar laminectomy, clinical screw, internal fixation and fusion and harvest bone graft pursuant to s 60 of the 1987 Act.
The respondents seek orders that the appeal be dismissed, and the Certificate of Determination dated 25 October 2019 be confirmed.
DISCUSSION
Ground One
The appellant’s first ground of appeal asserts that the Arbitrator erred in determining that the insertion of the pedicle screws and cage was “incidental” to the surgery. The appellant asserts that such error arose as a result of misapplying the observations made by Macfarlan JA in Baldacchino. In part, those observations included reference to Thomas, which had been the subject of submissions in the original proceedings before the Arbitrator and on appeal to the Presidential member of the Commission.
It is relevant to this appeal to consider the rationale in Thomas referred to by Macfarlan JA in Baldacchino.
Thomas concerned an application by a worker for the cost of modifications to a motor vehicle that were required to give the injured worker the ability to drive the vehicle. The worker relied on s 10(2)(b) of the Workers’ Compensation Act 1926 (the 1926 Act), which, as it was in force at the time provided that “medical treatment” included:
“the provision of skiagrams [that is, x-rays], crutches, and artificial members, eyes or teeth and other artificial aids and spectacle glasses”.
The worker argued that modifications to the motor vehicle constituted the provision of “artificial aids” within that section. The Court of Appeal held that such costs (described by Mahony JA as the installation of hand controls) were “artificial aids” within the meaning of the section. Mahony JA (with whom Hope JA agreed) made the following observations:
“An artificial aid, in my opinion, is anything which has been specially constructed to enable the effects of the disability (the result of injury) to be overcome. The other articles in the subclause, crutches, artificial members, eyes or teeth, are illustrations of this. Because of [the applicant’s] injury, she has lost all capacity for natural progression. The modifications to the car have given her some capacity to transport herself. It was suggested that, on this basis, the car was an artificial aid, and every person whose capacity to walk was diminished could have a car supplied at the expense of the insurer. It is not necessary to decide whether this conclusion follows. The essential quality of an artificial aid is that it is an aid specially tailored to the needs of a person, which flowed from the injury. The artificial aid is specific to an injured person. These modifications have this quality. As an artificial aid is useless unless the person for whom it is provided can use it, the provision of an artificial aid includes the provision of instruction in its use.”[29]
[29] Thomas, 221–222.
Macfarlan JA in Baldacchino (with Payne JA and Simpson AJA agreeing) accepted that Thomas was relevant authority as to what constitutes an artificial aid. His Honour said:
“The only arguably material change in the form of the legislation has been the insertion in it of express reference to ‘the modification of a worker’s home or vehicle’ as constituting medical treatment (s 59A(6)(b)). By this change, the legislature confirmed that the finding in Thomas reflected its intent that the injured worker’s right to compensation in respect of the cost of such modification should not be subject to a time limit.
The effect of the insertion is thus to endorse, rather than contradict, the outcome in Thomas.”[30]
[30] Baldacchino, [34]–[35].
Macfarlan JA made the following further observations in Baldacchino that are relevant to this appeal:
“[30] The appellant’s submission that the article or object must be ‘complete in itself’ cannot be accepted. No such requirement is evident in the statutory words or supported by any authority to which the Court was referred. As the respondent pointed out, many ‘artificial aids’ involve a process of connection of articles to the body in a manner comparable to that involved in knee replacements …
[38] The appellant attempts … to argue that the proposed knee replacement is different in character from the specific ‘artificial aids’ expressly identified in s 59A(6)(a). Whilst it is a different means of alleviating a disability, there is no feature of the knee replacement which distinguishes it in principle, or character, from the other aids referred to. For example, as mentioned above and as conceded by the appellant, the internal character of the replacement knee does not take it outside the legislative provision, nor does the fact that it comprises a number of material elements which, when affixed or installed, are designed to operate together to alleviate the disability.
…
[42] As indicated in [29] above, the ‘provision of’ the artificial aid in the form of a replacement knee requires surgery. That surgery is therefore within s 59A(6)(a). I should not be taken to be adopting a general rule that the cost of surgery is always a cost of ‘[t]he provision of ... artificial aids’, as there may be cases where the insertion of material into a person’s body is only an incidental part of major surgery. Each case must be decided on its own facts.”[31]
[31] Baldacchino, [30], [38] and [42].
The following summary of principles can be taken from the above passages:
An “artificial aid”:
(a) is something that is constructed to enable the effects of the disability to be overcome (Thomas);
(b) is specifically tailored to the needs of the person (Thomas);
(c) may involve a process of connection of articles to the body (such as a knee replacement) (Baldacchino);
(d) can comprise a number of material elements which, when affixed or installed, are designed to operate together to alleviate the disability (Baldacchino), and
(e) must be more than only an incidental part of major surgery (Baldacchino).
In the present case, the Arbitrator considered that the appellant’s arguments were “well made” but that they could not overcome Macfarlan JA’s caution that each case must be determined on its own facts and that there was no general rule that the cost of surgery would always constitute the provision of artificial aids. The Arbitrator considered that there was a distinction between a total knee replacement or spinal stimulator and the proposed laminectomy and spinal fusion. He explained that distinction as being one in which the knee replacement and spinal stimulator were designed to ameliorate the injured worker’s condition, but the proposed surgery was not. It appears the Arbitrator inferred from Macfarlan JA’s reasoning that what is required is that the aid is designed to improve function. There was no such limitation evident from the terminology used by Macfarlan JA and it was not open to the Arbitrator to arrive at such a conclusion. It follows that the Arbitrator erred in drawing such a distinction.
The appellant complains that the misapplication of the principles enunciated in Baldacchino led to the Arbitrator’s error in concluding that the insertion of the pedicle screws and cage was an “incidental” part of the surgery. The appellant submits that the bone graft, and the insertion of the pedicle screws and cage were an integral part of the procedure to stabilise the spine. The respondents dispute that the appellant’s pain would be alleviated by the stabilisation of the spine and say that the only need for the stabilisation arises because of the de-stabilisation resulting from the decompression procedure. I do not accept that the benefit from the procedure can be so segmented as to exclude the insertions of the pedicle screws and cage from being an integral part of the procedure. The aim of the surgery was to alleviate the appellant’s pain and disability and a necessary part of that was the consequent need to ensure stabilisation of the spine.
The Arbitrator concluded that the purpose of the insertion of the hardware was simply to assist the surgeon to complete the procedure and was thus incidental to the surgery. The Arbitrator’s conclusion, which was based on a misapplication of the principles in Baldacchino, cannot be accepted, given the explained integration of the bone graft, the pedicle screws and cage with the appellant’s spine which were together designed to achieve the eventual outcome.
It follows that the Arbitrator erred. For these reasons, Ground One of the appeal succeeds.
Ground Two
The appellant’s second ground of appeal alleges error on the part of the Arbitrator by failing to consider the appellant’s submission that the bone graft supported by the pedicle screws and cage was itself an “artificial aid.” The appellant submits that the submission is an important submission because it addresses the observation by Macfarlan JA in Baldacchino that the aid must work to ameliorate the disability and may consist of a single object or a composite of objects working together. The respondents’ submissions are silent as to whether the Arbitrator dealt with the appellant’s submission on this point.
A failure to consider a submission that is material to a point in issue is an error of law. As McCallum JA (with Macfarlan JA and Meagher JA agreeing) observed in Wang v State of New South Wales[32] (citations omitted):
“The submission invoked the decision of the High Court in Dranichnikov v Minister for Immigration & Multicultural Affairs in which it was stated that a failure to respond to a substantial, clearly articulated argument relying on established facts was a constructive failure to exercise jurisdiction. The decision is not authority for the proposition that any failure to refer to any argument put to a trial judge amounts to error. It is necessary to engage with the nature and materiality of the argument in the context of the issues in the proceedings.”
[32] [2019] NSWCA 263, [63].
In the present matter, the appellant sought a determination from the Arbitrator as to whether the bone graft and/or pedicle screws constituted “artificial aids.” The Arbitrator gave no consideration as to whether or not the bone graft itself could be considered an artificial aid or whether the bone graft, in concert with the pedicle screws and cage, were designed together to alleviate the appellant’s disability. In the context of the issues in these proceedings, the submission made by the appellant at arbitration was material to the matters requiring determination. It follows therefore that the Arbitrator was in error by not addressing the submission made by the appellant that the bone graft supported by the pedicle screws and cage was itself an “artificial aid.”
It follows that Ground Two of the appeal is made out.
Grounds Three and Four
Grounds Three and Four of this appeal concern the Arbitrator’s conclusion that the pedicle screws and cage would be removed was a relevant consideration. Ground Three asserts that there was no evidentiary basis upon which the Arbitrator could conclude that the hardware would be removed and that it was not open to the Arbitrator to draw on his experience as a member of a specialist tribunal to arrive at that conclusion. The appellant asserts in Ground Four that it was, in any event, an irrelevant consideration. It is convenient to first address the Ground Four.
The appellant submits that there was no suggestion in Baldacchino that the permanency or otherwise of the proposed aid was a relevant consideration. The appellant points to Hutley JA’s observations in Thomas quoted at [81] above, where his Honour referred to the examples listed in s 10(2)(b) of the 1926 Act. The appellant says that the examples include crutches, which are temporary in nature. The respondents concede that the relevant authorities do not require the artificial aid to be permanent but assert that there is a real difference between a crutch and the provision of pedicle screws and cages.
The respondents’ concession that there is no such requirement is sufficient to establish that the Arbitrator erred by considering the permanency or otherwise as being a matter for consideration. In any event, as the appellant submits, not only do the authorities not suggest such a criterion and the examples listed would suggest otherwise, but also s 59A(6)(a) of the 1987 Act itself does not qualify the term “artificial aid” by using the word “permanent.”
It follows that Ground Four of the appeal establishes further error on the part of the Arbitrator.
Having established error as alleged in Grounds One, Two and Four, it is not necessary to consider Ground Three of this appeal.
On the basis of all of the above established errors, the Certificate of Determination issued by the Arbitrator dated 25 October 2019 is revoked.
Where the decision of the Arbitrator is revoked, s 352(7) of the 1998 Act permits the Presidential member to make a new decision in its place. All parties have made submissions on the appeal that advance their arguments for and against the determination of the issue. The parties’ submissions at arbitration were recorded and I have the transcript available to me. I have considered those submissions and the Arbitrator’s summary recorded at [37]–[38] above. Given the narrow ambit of the issue to be determined, it is appropriate for me to re-determine the matter.
RE-DETERMINATION
The appellant’s submissions
The appellant referred to A/Prof Davies’ explanation of the proposed procedure set out in his report dated 23 May 2019, which, the appellant submitted, left no real doubt about what was involved in the procedure and its intended effect. The appellant cited Baldacchino as authority for the proposition that artificial aids must work to ameliorate the effect of the person’s disability. The appellant submitted there could be no doubt that the use of the pedicle screws and interbody cages was intended to ameliorate the effect of the appellant’s disability.
The appellant further submitted that Baldacchino confirmed that an artificial aid could comprise a composite of objects operating together. The appellant said that in his case, the materials are designed to stabilise the spine, which cannot occur without surgery and is an integral part of that surgery, so that the cost of the surgery would fall within s 59A(6)(a) of the 1987 Act.
The respondents’ submissions
The respondents submitted that each case must be determined on its own facts. The respondents quoted extensively from Thomas and directed the Arbitrator’s attention to Hutley JA’s observation that the proposed aid must be something that is specifically constructed, and its construction is peculiar to the person. The respondents referred to the quotation provided by A/Prof Davies that listed item numbers which were generic and not exclusive to the particular spinal surgery being considered.
The respondents submitted that the subject of Baldacchino was a knee replacement, which was permanent in nature and designed to facilitate movement. The respondents referred to Macfarlan JA’s comments in Baldacchino that there may be cases where the insertion of material into the body is merely an incidental part of major surgery. The respondent said that this case was such a case, where the parts to be inserted were only incidental to the surgery.
The respondents referred to A/Prof Davies’ description of the procedure and said that the primary purpose of the procedure was to ensure adequate decompression of the L4 and L5 nerve roots and the necessary second part was the stabilisation of the spine which had been rendered unstable by the decompression procedure. The respondents submitted that the insertion of the hardware was simply incidental to the second part of the procedure and not an artificial aid, consistent with Macfarlan JA’s comments.
Consideration
Following the principles enunciated in Thomas and Baldacchino, and taking into consideration the submissions made by the parties, the first matter for consideration is whether the proposed aid is intended to enable the effects of the disability to be overcome (Thomas).
A/Prof Davies detailed some of the effects of the injury in his report dated 2 February 2015. That is, the appellant was having difficulties standing upright, exercising, and was spending most of the time lying down. The procedure proposed by A/Prof Davies was to address those difficulties. A/Prof Davies also advised that the procedure was intended to alleviate the appellant’s pain and disability.
The purpose of the insertion of the pedicle screws and interbody cage was clearly intended to alleviate the appellant’s disability, where the outcome was to maintain stability of the spine and thus reduce the appellant’s disability.
The surgery must be considered in its entirety, without any artificial distinction between the decompression procedure and the spinal fusion. The surgery as a whole was intended to at least provide a degree of relief of the appellant’s symptoms. Any benefit from the surgery was expected to result in an amelioration of the appellant’s disability.
I accept the appellant’s submission that the bone graft, pedicle screws and interbody cages together form an aid that, when fixed to the appellant’s spine, operate together to achieve the purpose of alleviating the appellant’s disability. The unchallenged evidence from A/Prof Davies is that the insertion of this combined fixture is a necessary element of the surgery and is thus not merely incidental to this major surgery. Such a conclusion is consistent with Macfarlan JA’s observation in Baldacchino that an artificial aid can comprise a number of materials.
A/Prof Davies explained the manner in which the bone would be taken from the pelvis, roughened and inserted between the vertebrae. The bone needed to be kept in place by the pedicle screws and cages. While the hardware may well be generically manufactured for use in spinal fusion surgery, the surgical skill in assembling the combination of materials and the affixing of those materials must require some specific adaptation. The process described by A/Prof Davies does not reflect anything less specific to the needs of the patient than the manufacture of hearing aids, provision of crutches, or indeed a knee replacement.
I am satisfied therefore that the bone graft, pedicle screws and interbody cages together constitute an artificial aid for the purpose of s 59A(6)(a) of the 1987 Act and that the appellant is entitled to have the cost of and incidental to the surgery met by the respondents.
DECISION
The Arbitrator’s Certificate of Determination dated 25 October 2019 is revoked and the following findings and orders are made in its place:
(a) The provision of a bone graft with pedicle screws and interbody cages to be implanted in a spinal nerve root decompression and fusion is an “artificial aid” for the purposes of s 59A(6)(a) of the Workers Compensation Act 1987.
(b) The respondents are to pay the costs of and incidental to the lumbar decompression and spinal fusion as proposed by Associate Professor Mark Davies pursuant to s 60 of the Workers Compensation Act 1987.
Elizabeth Wood
DEPUTY PRESIDENT
24 April 2020
Key Legal Topics
Areas of Law
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Workers Compensation Law
Legal Concepts
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Artificial Aid
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Compensation Orders
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Statutory Interpretation
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