Khouri v Pacific National (NSW) Pty Ltd
[2008] NSWWCCPD 23
•22 February 2008
WORKERS COMPENSATION COMMISSION
DETERMINATION OF APPEAL AGAINST A DECISION OF THE COMMISSION CONSTITUTED BY AN ARBITRATOR
CITATION:Khouri v Pacific National (NSW) Pty Ltd [2008] NSWWCCPD 23
APPELLANT: Tony Khouri
RESPONDENT: Pacific National (NSW) Pty Ltd
INSURER:Pacific National (NSW) Pty Ltd
FILE NUMBER: WCC4595-07
DATE OF ARBITRATOR’S DECISION: 12 October 2007
DATE OF APPEAL DECISION: 22 February 2008
SUBJECT MATTER OF DECISION: Section 40(2)(b) of the Workers Compensation Act 1987; application of the principles in Mitchell v Central West Area Health Service (1997) 14 NSWCA 526; circumstances in which it is appropriate to exercise the discretion under section 40(1) of the Workers Compensation Act 1987
PRESIDENTIAL MEMBER: Deputy President Bill Roche
HEARING:On the papers
REPRESENTATION: Appellant: Koutzoumis Lawyers
Respondent: Bartier Perry
ORDERS MADE ON APPEAL: Time to appeal is extended until 13 November 2007.
Paragraph three of the Arbitrator’s determination of 12 October 2007 is revoked and the following order made:
“The matter is remitted to a different Arbitrator to re-determine the Applicant Worker’s entitlement to weekly compensation from 7 November 2006 under section 40 of the Workers Compensation Act 1987 in accordance with the principles and authorities in this decision.”
Paragraphs one, two, four and five of the Arbitrator’s determination of 12 October 2007 are confirmed.
The Respondent Employer is to pay the Appellant Worker’s costs of the appeal.
BACKGROUND TO THE APPEAL
Tony Khouri (‘the Appellant Worker/Mr Khouri’) was born in Lebanon and came to Australia in 1970. He is currently 56 years of age. He initially worked in the clothing industry and started work with the State Rail Authority in 1978 as a junior station assistant. Over the years the identity of the State Rail Authority has changed and at the date of Mr Khouri’s injury it was known as Pacific National (NSW) Pty Ltd (‘the Respondent Employer/Pacific’).
On 1 April 2003 Mr Khouri injured his right wrist while connecting two air hoses in the course of his employment. He finished his shift and reported his injury. He attended his local doctor who arranged for x-rays and provided him with a splint. After about four weeks off work he returned on light duties in the office for six months and was then given a driving job until his employment was terminated in October 2004.
Pacific accepted Mr Khouri’s claim and made voluntary compensation payments until 24 September 2005 when liability for weekly compensation ceased by notice issued under section 54 of the Workers Compensation Act 1987 (‘the 1987 Act’). Mr Khouri’s Application to Resolve a Dispute (‘the Application’) was registered in the Commission on 25 June 2007. In it he sought weekly compensation from 24 September 2005, medical expenses and lump sum compensation in respect of an 8% whole person impairment as a result of injury to his right upper extremity.
The Application initially joined the State Rail Authority as the First Respondent and alleged injury to the right hand/wrist, depression and anxiety as a result of the injury on 1 April 2003 and as a result of the nature and conditions of employment from 1996 until 2004. However, after an arbitration hearing on 24 August 2007 the Commission made the following orders by consent (see Certificate of Determination – Consent Orders on 5 September 2007):
“1.That the Applicant’s claim for injury resulting from the nature and conditions of his employment be discontinued. The requirement to lodge a Notice of Discontinuance is dispensed with.
2.That the Applicant’s claim for medical expenses under section 60 of the Workers Compensation Act 1987 be discontinued. The requirement to lodge a Notice of Discontinuance is dispensed with.
3.The matter is remitted to the Registrar for referral to an AMS for assessment of his Whole Person Impairment in relation to the injury to his right upper extremity on 1 April 2003.
4.The determination in [sic] the Applicant’s claim under section 40 of the Workers Compensation Act 1987 against the 2nd Respondent [Pacific] was [sic] reserved to be handed down at a later date.”
As a result of the above orders, the claim against the State Rail Authority was dismissed.
At a second arbitration on 27 September 2007, counsel represented the parties and Mr Khouri gave oral evidence and was cross-examined about his claim for weekly compensation. In a reserved decision dated 12 October 2007 the Arbitrator made the following determination:
“1.That the Respondent pay the Applicant weekly compensation at the rate of $874.76 from 25 October 2005 to 11 May 2006 under section 36 of the Workers Compensation Act 1987.
2.That the Respondent pay the Applicant weekly compensation at the maximum statutory rate from 12 April 2006 to 6 November 2006 under section 37 of the Workers Compensation Act 1987.
3.Award for the 2nd Respondent thereafter under section 40 of the Workers Compensation Act 1987.
4.That the Applicant discontinue the section 60 claim and the Notice of Discontinuance is dispensed with.
5.That the Respondent pay the Applicant’s costs as agreed or assessed.”
Mr Khouri seeks leave to appeal the Arbitrator’s decision to make an award in favour of the Respondent Employer in respect of weekly compensation from 7 November 2006 to date.
LEAVE TO APPEAL
Monetary Threshold
Before proceeding to deal with an appeal the Commission must determine whether the application meets the requirements of section 352 of the Workplace Injury Management and Workers Compensation Act 1998 (‘the 1998 Act’).
There is no dispute that the thresholds in section 352(2)(a) and (b) of the 1998 Act are satisfied.
Time
The appeal was initially filed within time on 7 November 2007 but was rejected by the Commission by letter dated 9 November 2007 (said to have been received by Mr Khouri’s solicitors on 12 November 2007) because it did not attach submissions on certain threshold issues. The appeal was filed again on 13 November 2007, outside the 28 days period in section 352(4) of the 1998 Act.
An extension of time in which to appeal is governed by Part 16 Rule 16.2(11) of the Workers Compensation Commission Rules 2006 (‘the 2006 Rules’). It provides:
“(11) The Commission constituted by a Presidential member may, if a party satisfies the Presidential member, in exceptional circumstances, that to lose the right to seek leave to appeal would work demonstrable and substantial injustice, by order extend the time for making an appeal.”
The question of extending time to appeal was considered by Justice McHugh in Gallo v Dawson (1990) 93 ALR 479 (‘Gallo’) where his Honour said at 480:
“The discretion to extend time is given for the sole purpose of enabling the court or justice to do justice between the parties: see Hughes v National Trustees Executors & Agency Co of Australasia Ltd [1978] VR 257 at 262. This means that the discretion can only be exercised in favour of an applicant upon proof that strict compliance with the rules will work an injustice upon the applicant. In order to determine whether the rules will work an injustice, it is necessary to have regard to the history of the proceedings, the conduct of the parties, the nature of the litigation, and the consequences for the parties of the grant or refusal of the application for extension of time: see Avery v No 2 Public Service Appeal Board [1973] 2 NZLR 86 at 92; Jess v Scott (1986) 12 FCR 187 at 194-5; 70 ALR 185. When the application is for an extension of time in which to file an appeal, it is always necessary to consider the prospects of the applicant succeeding in the appeal: see Burns v Grigg [1967] VR 871 at 872; Hughes at 263-4, Mitchelson v Mitchelson (1979) 24 ALR 522 at 524. It is also necessary to bear in mind in such an application that, upon the expiry of the time for appealing, the respondent has ‘a vested right to retain the judgment’ unless the application is granted: Vilenius v Heinegar (1962) 36 ALJR 200 at 201.”
The Appellant Worker submits that time under the 1998 Act stopped running between 7 November 2007 and 12 November 2007 “such that the re-lodged Form 9, being lodged on 13 November 2007, is now lodged within 24 days of receipt” of the Certificate of Determination (Appellant Worker’s submissions 2.1, paragraph six). This submission is unsupported by any authority or argument and is plainly wrong. Other than this misconceived submission, the Appellant Worker has made no submissions addressing the terms of Rule 16.2. As a result I issued the following Direction on 23 January 2008:
“The Appeal Against Decision of Arbitrator in this matter was filed on 13 November 2007 and is therefore out of time under section 352(4) of the Workplace Injury Management and Workers Compensation Act 1998. The parties are directed to Part 16 Rule 16.2(11) of the Workers Compensation Commission Rules 2006.
The following direction is made in this matter:
1.The Appellant Worker is to file and serve on or before 4.30pm on Wednesday 6 February 2008 submissions in support of his application to extend time to appeal.
2.The Respondent Employer is to file and serve on or before 4.30pm on Wednesday 20 February 2008 submissions in response.”
In response to the above direction the Appellant Worker filed further submissions on 5 February 2008 in which the following points are made:
(a)the appeal was initially filed in time on 7 November 2007 and served on the Respondent Employer on 9 November 2007;
(b)the letter rejecting the appeal is dated 9 November 2007 but was not received by his solicitor until 12 November 2007, outside the 28 day period in section 352(4);
(c)the appeal was promptly re-lodged on 13 November 2007;
(d)he will suffer demonstrable and substantial injustice if time to appeal is not extended;
(e)the Respondent Employer has demonstrated no prejudice if time to appeal is extended, and
(f)the appeal has good prospects of success.
The Respondent Employer submits that time to appeal should not be extended because:
(a)the need for an extension of time is due to the Appellant Worker’s own failure to comply with the legislative requirements, as set out in Practice Direction Number 6;
(b)the Appellant Worker has not provided an adequate explanation as to why the original document failed to contain submissions on the threshold issues relating to the granting of leave;
(c)no exceptional circumstances exist to justify such extension, and
(d)the evidence supports the appeal being dismissed.
Having regard to the above submissions, the history of the matter, and decision of Justice McHugh in Gallo, I am satisfied, in exceptional circumstances, that for Mr Khouri to lose the right to seek leave to appeal would result in a demonstrable and substantial injustice and that time to appeal should be extended. My reasons are as follows:
(a)the history of the proceedings indicates that the appeal was originally filed in time and was initially served on the Respondent Employer on 9 November 2007;
(b)the letter rejecting the appeal was not received by the Appellant Worker’s solicitor until after time to appeal had expired;
(c)there is no evidence to suggest that Mr Khouri’s conduct resulted in the matter being out of time;
(d)the Appellant Worker’s solicitor acted promptly to re-lodge the appeal on 13 November 2007;
(e)the appeal raises issues that are strongly arguable about the fundamental steps to be taken in the calculation of compensation under section 40 of the 1987 Act;
(f)the consequences of losing the right to appeal will be severe for Mr Khouri;
(g)the Respondent Employer has pointed to no prejudice it will suffer if time to appeal is extended, and
(h)the strict application of the 28 day time limit will work a demonstrable injustice to Mr Khouri.
I extend time to appeal until 13 November 2007 and grant leave to appeal.
PRELIMINARY MATTERS
Section 354(6) of 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.”
The Appellant Worker submits that the matter should be listed for hearing “as a proper decision requires the application of the Tribunal’s discretion after hearing submissions”. The Respondent Employer submits that the matter would benefit from a formal hearing but concedes that given the availability of Mr Khouri’s evidence on transcript it could be determined on the papers.
The parties have had ample opportunity to make written submissions in this matter and have done so. In addition, the Respondent Employer also provided the Arbitrator with written submissions and those submissions are before me. In these circumstances I did not believe an oral hearing is required.
Having regard to Practice Directions Numbers 1 and 6, the documents that are before me, 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.
ISSUES IN DISPUTE
The issue in dispute in the appeal is whether the Arbitrator erred in her application of the principles in Mitchell v Central West Area Health Service (1997) 14 NSWCA 526 (‘Mitchell’).
The Arbitrator applied the five steps set out in Mitchell as follows:
(a)Step 1: Probable earnings but for injury were agreed at $1,268.17 per week;
(b)Step 2: She determined “the average weekly amount that the Applicant did earn from 6 November 2006 to the present is $250 per week” (Statement of Reasons for Decision (‘Reasons’), paragraph 28);
(c)Step 3: Deducting $250.00 from $1,268.17 gave a difference of $1,018.17 per week, an amount greater than the statutory maximum for a worker with no dependants;
(d)Step 4: Taking into account the evidence of Mr Khouri’s capacity during the period 6 November 2006 to date and the evidence of what he would have been able to earn in suitable employment if he had sought suitable employment, the Arbitrator exercised her discretion under section 40(1) of the 1987 Act to “reduce the amount the Applicant is entitled to receive under Step 3 by $550 per week” (Reasons, paragraph 44), and
(e)Step 5: Under section 40(1) Mr Khouri’s entitlement to the maximum statutory rate does not bear “such relation to the amount of that reduction as appears proper in the circumstances” (section 40(1)), “thus the Applicant’s entitlement is to be reduced by an amount of $550 per week” (Reasons, paragraph 45(iv)).
It appears that the Arbitrator deducted the sum of $550.00 from the maximum statutory rate of weekly compensation for a single worker (as at 6 November 2006, $354.40 per week), which left a negative figure and concluded that Mr Khouri was therefore not entitled to weekly compensation under section 40 from 6 November 2006 to date and continuing.
REVIEW
The nature of a review and the role and function of a Presidential member on appeal has been considered in many cases in the Commission. In The King Island Company Ltd v Deery [2005] NSWWCCPD 1 it was held at [19]:
“19. A Presidential Member on appeal has a specific and limited role in the review of a decision of an Arbitrator. The review is not a rehearing. The Presidential member is not dealing with the matter de novo and is not arriving at a fresh decision based on all of the evidence available at a later time (Coal & Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194; Builders Licensing Board v Sperway Constructions (Sydney) Pty Ltd (1976) 135 CLR 616). The powers of the Presidential Member to revoke the decision pursuant to section 352(7) of the 1998 Act and to substitute a new decision in its place, are exercisable only where it is demonstrated that the decision of the Arbitrator is affected by some legal, factual or discretionary error (Allesch v Maunz (2000) 203 CLR 172). Alternatively, the Presidential Member may remit the matter back to the Arbitrator concerned, or to another Arbitrator, for determination in accordance with any decision or directions made.”
The nature of a review was considered by the Court of Appeal in Aluminium Louvres & Ceilings Pty Limited v Zheng [2006] NSWCA 34 where Bryson JA said at [38]:
“A review is a different process to an appeal and the matters which may be considered and the manner in which they may be considered are somewhat wider. See Boston Clothing Co Pty Ltd v. Margaronis (1992) 27 NSWLR 580 at 584 (Kirby P). An attack, on review or otherwise, on an Arbitrator's discretionary decision in controlling procedure may be based on the test stated in House v. R (1936) 55 CLR 499 at 504 - 505; but that is not the only basis on which the Presidential member may act. The powers of a Presidential member on review are somewhat wider and extend to power to reopen consideration of a matter of which an Arbitrator has disposed; the manner in which the powers of the Presidential member are to be exercised is itself the subject of discretion of the Presidential member.”
This passage was recently quoted with approval by McColl JA in South Western Sydney Area Health Service v Edmonds [2007] NSWCA 16 at [134] (‘Edmonds’). To describe the relative weight and relevance of the expert evidence as “a discretionary decision which could only be disturbed on House v The King principles” was described by McColl JA as “an over-generalisation” (at [133]).
The nature of a review was further considered by the Court of Appeal in State Transit Authority of New South Wales v Fritzi Chemler [2007] NSWCA 249 where Spigelman CJ said at [28] and [30]:
“28. The concept of a review on the merits is wider than the concept of an appeal in a judicial context. There is a well established line of authority on the use of the terminology of ‘review’ instead of ‘appeal’ with respect to the workers compensation system in this State which establishes the breadth of a review on the merits.
30. A Presidential member exercising a power to review a decision must decide whether the original decision is wrong or, as it is often put in the context of administrative appeals on merits, must decide what is the true and correct view. If s/he does so decide then s/he should substitute his or her own views, unless it is an appropriate case to remit. The power to remit is not constrained in the manner for which the Appellant contends.”
Before an Arbitrator’s decision will be revoked on review it must be demonstrated that it contains or has resulted from an error of fact, law or discretion. The error must be such that, but for it, a different decision should have been made (see Snow Confectionary Pty Ltd v Askin [2004] NSWWCCPD 56; Section 294 of the 1998 Act; YG & GG v Minister for Community Services [2002] NSWCA 247, and Absolon v NSW TAFE [1999] NSWCA 311).
I intend to apply the above principles in the matter before me.
SUBMISSIONS
The Appellant Worker makes no challenge to the Arbitrator’s findings in steps 1, 2 and 3 of Mitchell, but submits that the Arbitrator should have reduced the sum of $1,018.17 per week by $550.00 per week. The resulting difference ($468.17) is above the maximum statutory compensation for a worker with no dependants and Mr Khouri is entitled to an award at the maximum rate for a single worker from 6 November 2006 to date and continuing.
The Respondent Employer argues that the Arbitrator’s determination should stand and the appeal dismissed. It submits that Arbitrator accepted that Mr Khouri “would be earning more than the basic $600 per week the Applicant submitted” (Reasons, paragraph 43) and that Mr Khouri was an unreliable witness who prevaricated and endeavoured to avoid answering questions. Therefore, the Arbitrator was unable to rely upon the sum of $250.00 per week as representing Mr Khouri’s true ability to earn. The Arbitrator had no option and correctly exercised her discretion.
In the alternative, the Respondent Employer submits that the Arbitrator found Mr Khouri’s ability to earn was equal to or greater than $1,268.17 and he has no entitlement to compensation from 6 November 2006 to date.
DISCUSSION AND FINDINGS
The Arbitrator incorrectly applied the principles in Mitchell.
The Court of Appeal said in Mitchell (at 529-530):
“An award of weekly payment of compensation is not to exceed the ‘reduction in the worker’s weekly earnings’ (s 40). Section 40, like its predecessor s 11 of the Workers’ Compensation Act 1926, requires the judge making an award to follow a number of steps, although the precise number is a matter of some debate: cf JC Ludowici & Son Ltd v Cutri (1992) 26 NSWLR 580 at 582. The judicial process is discussed in Australian Wheat Board v Pantaleo [1984] 3 NSWLR 530. For present purposes, it is sufficient to observe that the Court is required:
1. To determine the weekly amount the worker would probably have been earning if uninjured (s40(2)(a)) …
2. To determine ‘the average weekly amount that the worker is earning or would be able to earn in some suitable employment from time to time after the injury’ (s40(2)(b)). Section 40(3) provides that the determination of this amount is subject to the following:
‘(a) the determination is to be based on the worker’s ability to earn in the general labour market reasonably accessible to the worker;
(b) the determination is to be made having regard to suitable employment for the worker within the meaning of section 43A.’ …
3. To subtract the figure derived from (2) from the figure derived from (1) (s40(2)).
4. To decide whether and to what extent the reduction calculated as above bears ‘such relation to the amount of that reduction as may appear proper in the circumstances of the case’ (s40(1)).” (emphasis added)
The Arbitrator was in error in her application of Mitchell. The Court’s reference to “the reduction calculated as above” is a reference to the difference between probable earnings (Step 1) and actual earnings or ability to earn (Step 2). In this case that difference was calculated to be $1,018.17 per week. If, in the exercise of the section 40(1) discretion, a case calls for a reduction in the amount arrived at in Step 3, the discretion is applied to the difference between steps 1 and 2 ($1,018.17), not to the statutory rate of compensation.
The above error does not mean that Mr Khouri automatically receives the difference between $1,018.17 and $550.00, as he has submitted. The Arbitrator also erred in her application of the discretion under section 40(1). The section 40 discretion has been the subject of consideration in numerous cases. It is important to note that it is not appropriate to reduce the mathematical difference between probable earnings and ability to earn solely because the worker is not looking for work (Mitchell at 534). It has been held that it is appropriate to use the discretion to reduce the arithmetical difference between Steps 1 and 2 of Mitchell in the following situations:
(a)where the worker has retired or suffered some supervening illness or injury (Australian Wire Industries v Nicholson (1985) 1 NSWCCR 50 at 55, and Australia Iron & Steel Pty Ltd v Elliott (1966) 67 SR (NSW) 87);
(b)where the worker had been retired for two years before the injury which occurred during a short period of work, which was a one-off job (Pratt v Claydon (1996) 14 NSWCCR 86);
(c)where the worker was imprisoned during a period of partial incapacity (Stranlund v Mid Coast Meat Co Pty Ltd (1999) 19 NSWCCR 91);
(d)since the injury the worker has been dismissed because of a criminal conviction (Morgan v Commissioner for Railways [1972] WCR 33);
(e)before the injury the worker chose to work for only limited periods each year (May v Eisenhower [1967] WCR 137), and
(f)where the worker was pregnant (Wrigley Co Pty Ltd v Holland (2002) NSWCCR 463).
The only matter that might be relevant to the exercise of the discretion in the present matter is the fact that Mr Khouri gave evidence that he has shoulder pain that prevents him from starting work with a company called Easy Go Green (T12). Whether that is relevant to the final determination of the matter depends on the ultimate finding as to Mr Khouri’s ability to earn.
The Respondent Employer’s submission that the Arbitrator found that Mr Khouri would be earning more than $600.00 per week is correct (Reasons, paragraph 43). However, that finding was made while the Arbitrator was purporting to deal with the exercise of the discretion, not while making a determination of Mr Khouri’s ability to earn. Further, the Arbitrator never made a formal finding of Mr Khouri’s ability to earn and was in error for failing to do so.
I also agree with the Respondent Employer’s submission that the Arbitrator (quite properly) felt unable to rely on the figure of $250.00 per week as representing Mr Khouri’s true ability to earn in the labour market reasonably accessible to him. However, the correct application of Mitchell required an assessment of Mr Khouri’s ability to earn in Step 2.
Further, the finding that Mr Khouri’s actual earnings were $250.00 per week for the period from 6 November 2006 to 12 October 2007 was not reasonably open on the evidence. That finding was based on Mr Khouri’s unsatisfactory evidence that he earned about $12,000.00 over 10 or 11 months whilst doing some supervisory work (T5.42) for his cousin, George Khouri. That work appears to have involved Mr Khouri in organising the renovation of a house owned by George. At T5.54 Mr Khouri said, “I sort of organise the work, I buy the material for him, and I employ some guys and myself”. Mr Khouri also did some of the work (painting) himself (T6.3 and T9.20). On the question of how much he was paid, Mr Khouri said at T6.11:
“A. I take my time. Like, I don’t work on, sort of on an hour ‑ a daily rate. I ‑ he says, ‘Take your time.’ He knows of my condition, and I ‑ so maybe he pays me some money into my account, and I buy the material and pay the guys. If you want figures, I can get you figures.
Q. Well, how much?
A. Probably, like, roughly I earn maybe about 12,000 for myself.Q. Over what period?
A. Within – it’s different to this time now since ‑ I make money about 10 or 11 months ago, up till then.
Mr Khouri was not sure when he started the work (T6.34).
In cross-examination Mr Khouri revealed that he has an ABN number (T10.13), which relates to the business “The Odd Couple” (T10.15) but he did not know if he was the registered proprietor of that business. Notwithstanding that the payments for the work done by Mr Khouri for George went into Mr Khouri’s bank account (T10.50), no bank records were tendered. Mr Khouri stated that he gave “rough figures” (T11.4) “because there are expenses, material to be bought” (T11.8).
In the absence of proper records, this evidence did not justify a finding that Mr Khouri’s actual earnings from 6 November 2006 to 12 October 2007 were $250.00 per week. In any event, it seems that Mr Khouri may have been involved in a business with his cousin George and that he was not employed on a wage but was paid a lump sum from which he paid for materials and paid workers who he (Mr Khouri) employed (T5.54). At best the evidence supported a finding that Mr Khouri was capable of performing supervisory duties, painting, and cleaning work, though exactly how much and over what period was never clarified. In determining his actual earnings in this period the appropriate test for a worker conducting a business is to consider the value of his labour to the business (Cage Developments Pty Ltd t/as Monaro Mix Specified Concrete v Schubert [1981] 2 NSWLR 227).
The evidence of Mr Khouri’s activities between 6 November 2006 and 12 October 2007 is obviously most relevant in determining his ability to earn (Step 2 of Mitchell).
Therefore, the Arbitrator was in error in finding that Mr Khouri’s actual earnings for the period from 6 November 2006 until 12 October 2007 were $250.00 per week.
As can be seen from this analysis, the Arbitrator’s approach to the section 40 assessment was flawed and the matter must be re-determined in accordance with the principles in Mitchell and the other authorities noted above. In view of the significant credit issues involved in this case and the inadequate submissions on appeal, it is not appropriate for me to re-determine the matter. In addition, Mr Khouri claims in his Application to have two dependant children but on appeal he sought an award for a single worker with no dependants. This issue needs to be clarified.
OTHER MATTERS
The errors in this matter may have resulted from the Arbitrator’s application of the incorrect approach taken in Snow Confectionary Pty Ltd v Askin [2004] NSWWCCPD 56 (Askin).
In Askin, probable earnings but for injury were $460.13 per week. The Arbitrator found the worker had an ability to earn of $549.23 in certain specified jobs. However, because she was unable to obtain such work her capacity to earn in suitable employment was found to be nil. Therefore, the Arbitrator found the worker had an entitlement to an award of $460.13 per week. On appeal, the Presidential member held that the Arbitrator erred in failing to exercise her discretion under section 40(1) (step 4 in Mitchell). In purported exercise of the discretion, the Presidential member determined that the worker did in fact have a residual earning capacity of $150.00, which reduced the worker’s entitlement to $310.13 per week.
The end result may well have been appropriate in the circumstances of that case, but the method adopted was inconsistent with accepted authority on section 40. If the worker had a residual earning capacity of $150.00 that finding should have been made at Step 2 of the process after due regard to the worker’s injury, incapacity, the available labour market and the other matters listed in section 43A of the 1987 Act. Then the discretion can be considered to determine if the difference between step 1 ($460.13) and step 2 ($150.00) was “proper in the circumstances of the case” (section 40(1)).
DECISION
Time to appeal is extended until 13 November 2007.
Paragraph three of the Arbitrator’s determination of 12 October 2007 is revoked and the following order made:
“The matter is remitted to a different Arbitrator to re-determine the Applicant Worker’s entitlement to weekly compensation from 7 November 2006 under section 40 of the Workers Compensation Act 1987 in accordance with the principles and authorities in this decision.”
Paragraphs one, two, four and five of the Arbitrator’s determination of 12 October 2007 are confirmed.
COSTS
The Respondent Employer is to pay the Appellant Worker’s costs of the appeal.
Bill Roche
Deputy President
22 February 2008
I, NING DONG, CERTIFY THAT THIS IS A TRUE AND ACCURATE RECORD OF THE REASONS FOR DECISION OF BILL ROCHE, DEPUTY PRESIDENT OF THE WORKERS COMPENSATION COMMISSION.
ASSOCIATE
2
8
0